because it was biden? i can't remember. i'll have to go back and look. >> powell is going to speak on friday. >> powell will speak on friday, and that will be right after harris will speak on thursday night. so, you have a lot to talk about. >> for an august, right? >> enjoy in august weekend. melissa, thank you. mr. professor, thank you. join us next week. have a great weekend. "squawk on the street" begins right now. ♪ good friday morning, welcome to "squawk on the street," i'm carl quintanilla with mike santoli here at the new york stock exchange. cramer and faber have the morning off. premarket, just south of flat. s&p now up 8% from last monday's low, just 2% from some all-time highs. our road map begins with that winning week for wall street. does the rally have more legs? plus, the weakest housing starts data since may of 2020 as redfin says the share of million dollar homes just hits an all-time

high. and the vice president set to deliver a major economic policy speech today featuring new tax cuts, housing incentives and price caps. let begin with the broader market in the midst of a six-day win streak, i think it's the best six days going back to '22. >> it's been a good streak, it makes sense to digest some of that, really if you go back to monday, s&p up in eight trading days and it's gained about two-thirds of what was lost. i think it tells you a couple things. one, the extremity of the stress in the very short-term, i think, cleared out so much in the way of accumulated exposure to stocks and positioning and risk assets and all the rest of it. you see it in all the hedge fund data, a lot of the sentiment stuff. that creates a little bit of a technical tailwind for that to normalize once something doesn't break as a result of that. then, the data have come in, as we have been talking about for a couple days, that allows investors to kind of rebuild

some confidence in the soft landing scenario, so relief across all those fronts. i think the strength of the comeback says a lot about the build-up of anxiety ahead of it, through the numbers about july softness and consumer and all of that. you know, what does it take to get you back to the highs in a hurry? probably quite a bit. doesn't take a lot in distance but i think you have to have a lot of certainty, so arguably, we're going to have to be surfing from data point to data point, testing against the soft landing scenario. very bullish if, in fact, the fed can signal it's going to start to ease and normalize policy and become less restrictive in a very deliberate, slow, orderly way, because that's always to me been the bull case, not that they start to cut and slash rates, because that seems like a little more of a desperation move. all of that fits together pretty well. earnings did their part. i would argue. 10% annualized, and citi saying that the non-mag seven stocks,

up 4% or 5% or something like that in the second quarter. not wonderful, but it's doing some of the lifting. >> first contribution from the 493 in six quarters. now we're starting to get some curtain-raisers on jackson hole. saying powell is likely to indicate that cuts are imminent. >> yes. >> and set the table for september. jpm desk today talks about whether or not cuts do anything to interrupt the growth bullish scenario. in other words, do they know something we don't know? they don't think so. >> i don't think we're close to that. if september happens with a cut, it will have been, what, 14 months since they hiked last. that's an extremely long time to be on pause. they've set the stage for this. they've talked about how restrictive policy is at this level. inflation, by cpi, and pce, going below 3%. it's a massive gap there, massive gap between fed funds

and interior yield. everything builds toward, they should be cutting now, not because the economy weakened appreciably beyond what they were expecting. i think that message should be taken okay. i guess the question is, does it have an actual effect aside from a psychological effect? it's much more about the gesture of, we're no longer trying to hold the economy back, there's room to cut without it meaning there's something negative for the economy, at least in the short-term. that's the win if it goes that way, but there are numbers between now and then, and goolsbee coming out and sort of changing his -- not changing his tune but maybe becoming more vociferous about, we got to be careful about downside risk. once we got past cpi and it didn't interrupt the narration about disinflation, it seems like the runway is clear. >> the word "robust" being used about retail sales. goolsbee did tell npr that when you start to see rises in the unemployment rate, it often

worsens quickly. take a listen. >> there are some various leading indicators of recession, and some of those are giving warning lights, but there's cross currents, credit card delinquencies rising is a warning. small business defaults, rising. that's also a warning. and rising unemployment rate is a warning. on the other side, you got gdp growth, still been pretty strong, and there are pockets of strength throughout the economy, so that's the job. the watched pot may never boil, but the fed's job is going to sit and watch the pot and figure out if it's boiling or freezing or what's happening. >> meantime, we've got tony p. at goldman-sachs note today saying we are in a period where we'll be watching every data point. there's no one path or the other you're looking to ratify. >> keep trying to reiterate that. soft landing doesn't mean everything's comfortable all the time. it means things look like maybe it's late cycle and maybe we're

tipping it to something more worrisome, and then you get rescued by a data point, and it just sort of moderation is moderation, and you know, if there is some kind of a landing, it's not just the fed landing, it's tightening policy. it's also the economy kind of normalizing back toward trend, so i do think that's kind of where we are. goolsbee giving voice to this idea that you don't want to be late in moving in this direction, you know, if you kind of go back and say, what was the big mistake in 2021, everyone will say, the fed didn't see inflation coming or at least downplayed its initial surge. so, is the lesson from that that you always want to be mindful of where the turn is ahead of you? or is it, inflation is this uniquely noxious beast that you can never be comfortable about? i think it's probably the former. you want to look for the next turn in the narrative. the market's been very impatient to set the inflation side aside. >> almost exactly what bostic told "the ft" yesterday, "you

really cannot afford to be late." here is fund strat global advisor's head of research, tom lee, joins us on a summer friday. thanks for coming in. last week, was it difficult to keep your bearings in the midst of that crazy price action? >> without question. the market had been whipsawed by data point to data point as you were recapping. the jobs report raised recession fears, big risk off. then we get inflation this week, which was pretty tame, and i think markets suddenly went back to thinking about liquidity coming into markets. i think thatthe data dependence of the markets and the fed is very tough for investors, and i think if you look ahead, i would say we always know the summer is tough. summer probably runs through october, but i don't think that anything's changed into year-end, which should look pretty good. >> is that -- are you lower conviction now than you were two

weeks ago? >> no. no change in our conviction. but it is just recognizing august, historically, is a tough month for markets. one thing that maybe investors can get encouraged by is since 1928, the most common month for the summer low is august. and the most common week is the first week of august. so, i think maybe the worst is behind us, but it doesn't mean we're straight up from here. >> right, and i guess the question is, i keep going back to, you know, that moment in mid-july when we were at the highs, you were just shy of 5,700 on the s&p 500, and everything was a go. it was, you know, the a.i. earnings path was kind of unquestioned, in addition to general soft landing expectations. you kind of didn't have a lot of painful tradeoffs to worry about in terms of policy or growth. can we get back to something like that? i guess the idea, as you say, may be summer lasts through october. do you expect that we're going to have to continue to reset around these levels?

>> yeah, i think we're -- it's -- if my best guess would be it's still going to be a struggle, but we're climbing ththe escalator again. i think jackson hole is going to set a positive tone on balance just because the balance is growing, fomc members want to be forward-looking. data dependence is dangerous at turning points, and then we get the jobs report for august, which i think should reverse some of the things that could be temporary. i mean, that's a guess, and if it is, then recession risk is sort of reduced, but now we have real rates are too high, and that means investors will be comfortable with cutting. >> i'm thinking back to some of the notes you wrote after the last jobs number, and you looked at hurricane beryl and the number of companies in texas that had no power for two weeks, and you do think august will be reassuring on the nfp print. >> yes, i mean, in some ways, the weekly claims is telling the story. we had a surge in claims on multi, multi-month high that

have come down since then, so even if someone says there was no effect from the hurricane, how do you explain claims really improving so much, especially in places like texas? and you know, yeah, i mean, a million homes without power for two weeks, how could that not affect the local economy and the jobs market? >> this rebound we've gotten from the lows of early last week, initially, certainly, until yesterday, it was back to the first half winners. it was a lot of the mega cap growth stocks and you know, the equal weight s&p really didn't have that much of a pullback, and it's closer to its highs. but small caps definitely got a flush, and yesterday, they rallied big on that retail sales number, but it seems like that's still been a complicated attempt at a rotation. >> that's right. they always say bottoms are tough, and bottoms are a process, and small caps are really in the process of a multi -- what we think is a multi, you know, multi-year bottom, and so conviction is not going to be as strong as things that have been working. i think most people's tool kit

is to buy the nasdaq or the a.i. names when they want to get back in the markets, but cutting rates at a time when small caps trade at ten times forward pe, better earnings growth, and then really a visible path to easing, i would say it still makes sense that the risk-reward is in small caps. >> and then we had a miss on housing starts this morning. so, it's funny. the parts of the economy you thought you could rely on for a while maybe are giving way, as other ones maybe start to bottom. but what's your thought there in terms of the flow-through to the rest of the economy? >> i think housing, auto sales, and durable goods are essentially in recession. it makes sense because cost of money is so high. it's super expensive and hard to afford a home or to buy a car with these rates. these are also directly benefitting from fed cuts, because adjustable rate mortgages adjust. business loans adjust. auto loans, credit card, they're sensitive to short-term rates.

>> builders loans too. >> that's right. cost of money for builders. i think these really benefit from an easing cycle, but a market that believes there's an easing cycle under way. >> what's your -- how many cuts do you think we get this year? >> i'm looking at consensus, which is somewhere between four and five. >> before the end of the year? >> yes. >> about 100 basis points? >> yes. i think that's right. but it depends on where inflation prints the next couple months, but you know, our base case is that we're on a glide path towards 2% that's better than consensus, so i think four to five still makes sense. >> part of your thesis has been that elements in cpi have been falling, in your words, like a rock. i saw that phrase repeated in another desk note yesterday, but are you as assured of that when you look at things like car insurance or the coincident cost of owning a vehicle? >> i think one of the things that surprises us still is two things are keeping inflation high on a weighted basis,

shelter and auto insurance. auto insurance, adequacy is there now. if you look at the results from these auto insurers, they don't need to raise rates, so i think that's cooling and that will come in the second half. and for housing, rent is stabilizing, and i think housing is going to cool. it just needs to get to 3 to 4% and then markets will be comfortable that we're back at 2%. but median inflation rate is still 1%. >> i think as greg said this week, rents are inertial. takes new time for those rents to cycle in. >> great seeing you. >> tom lee. when we come back this morning, today is the day. the vice president is set to outline her economic plans for tackling the high cost of living. we're going to look at how they stack up against those of former president trump. take a look at the premarket here as we try to get some of the premarket out of the red, although they're off the session lows, still, decisively below the flat line. stay with us. i can't believe you corporate types are still at it.

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the vice president is set to outline parts of her economic agenda this afternoon at a rally in north carolina. the focus will be on lowering the cost of living. meagan casella joins us this morning. >> hey, carl, good morning. harris is unveiling what looks like a four-part economic plan today focused on taxes, health care, housing and food. on taxes, she wants to restore and expand the child tax credit to provide up to $6,000 for families with kids under 1. she'd also expand the earned income tax credit and reduce taxes on health insurance premiums. also in health care, she wants to cap the cost of insulin at $35 and limit spending on prescription drugs to $2,000 for everyone, not just seniors. she's also vowing to increase competition in the pharmaceutical industry and to cancel medical debt for millions of people. then on housing, she would use tax credits to incentivize

construction of three million homes and provide up to $25,000 in down payment assistance for first-time buyers. she wants to ban corporate price gouging in the grocery industry. this is a left-leaning populist agenda, expands on some of president biden's ideas to spin them even a little more progressive and pulls directly from her 2020 platform, including that $6,000 child tax credit, so for all the talk of her moving to the center, and she's doing that on some issues but definitely not doing it on economic issues right now. all of that comes in contrast to trump's proposals to lower costs. those include cutting energy costs in half by drilling for more oil, extending tax cuts and slashing regulation. and neither of these plans is what most economists would ideally like to see. it's mostly aspirational campaign politics and would have a hard time getting through congress but there is a common thread in that both parties are offering voters someone to blame for high prices. that polls well. for harris, that's corporations, and for trump, it's the government. >> meantime, last night, megan, we did get this report out of

goldman taking a crack at some of the universal tariffs that the former president has been floating. their argument is that it's not their base case in large part because they think unlike china tariffs, the universal ones have less support because, in their words, it would have meaningful negative effects on the economy. >> absolutely. i think that's been really clear since president trump's first term. there's been so much economic analysis on this that the costs are transferred directly to consumers and they drive up prices. the politics of trade have really evolved in the past few years that both parties endorse targeted tariffs, and we've seen president biden impose some of those, but there's not a lot of support for universal tariffs. president trump may look for ways to do that in a second term through various statutes, especially depending on who he puts on u.s. trade representative but there's not a lot of support for that on capitol hill. >> you mentioned a lot of this is political gestures and messaging but also wonder to what degree vice president

harris has the ability to say, you know, based on some of the fiscal measures, we've actually ramped up factory construction, for example, in this country, and so a lot of the things that the trump administration had talked about doing have been done. you know, donald trump talks about raising oil production. we're at record oil production. it's almost like as a defensive way of approaching what the alternative message might be. >> definitely. i think that's what she wants to lean on, and i think we'll hear some of that this afternoon by saying, yes, some of these are progressive ideas, but we're also doing the pro-growth agenda and look how strong the economy is in this first term. she doesn't really want to distance herself from president biden's policies because on the whole, the economic fundamentals are really quite strong. what she does want to do is say to americans, i sympathize with you about high prices, and that's where we're seeing these ideas come from, but she can lean on what's happened over the past four years, say that oil production is up, say that growth is high, say that we're maybe not likely but we're looking at the moment like we might be headed for a soft

landing, and because of that, we can move towards some of these more progressive ideals. >> we will see how granular they get this afternoon, megan. appreciate that curtain-raiser. megan cassella joining us with harris's speechty. more movers to get to, including chip names going in opposite directions. look at the premarket here as we wrap up this interesting week of trading in a minute.

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got a couple of different stories in the chips space. one is texan now getting about $1.6 billion in funding from the chips act. the other is amat, down about 3.5% premarket. revenue in line, guide q4 in line, although some discussion about the china mix and sequential declines in china-related revenue. we'll talk more about it after the bell which is coming up in five and a half minutes. quick programming note. be sure to watch a special edition of "taking stock" with santoli tonight, 6:00 p.m. eastern time.

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all. whatever the stage, businesses that grow grow with shopify. >> announcer: the opening bell is brought to you by nuveen, a leader in income, alternatives, and responsible investing. all right, it's another day in which we're watching some data out of china. for example, foreign direct investment down almost 30% year on year, kind of brings us to

estee lauder which gets downgraded today over at b of a, in large part because they think their chinese thesis was wrong. >> exactly, that the comeback of that business is not taking hold. you keep expecting the turn. hasn't happened. and of course, estee lauder, in this huge drop over the past, i don't know, year and a half or so, has been a real recognition moment for just exactly how dependent el was on those businesses and if it is kind of a similar equation as investors look at this stock to what we're seeing with nike and starbucks, which is, always had a premium multiple, always these great, durable brands, and they've fallen on some kind of hard time, a lot of chinese dependency in there. that was part of the growth story that has faltered in all of those cases. we saw what happened with starbucks. brian niccol goes there, the stock pops. nike, similar thing. i don't think the fix is going to be the same, but it is interesting. relative to the market, estee lauder, nike, starbucks, have

basically fall ton lifetime low valuations. now, doesn't mean they're cheap. means they're low relative to the market compared to their history. you could even put a disney in there before this latest pop, so it's kind of interesting as the market looks for, i think, more idiosyncratic situations as opposed to just either we buy the a.i. profit stream or, you know, we're betting on a macro move. >> that was a theme that came out of the 13 fs, right? you get berkshire, ulta out of nowhere. and then some argued that on the activist front, where they're getting more aggressive in names that are non-tech, right? southwest. >> i feel like, look, the market has had a very good multi-year run. are we late cycle? in a lot of ways, it looks like maybe, and if you're an investor, if you're an activist and your ceo or stock hasn't really participated or done anything, it's kind of a, you know, now or never, or you have to, you know -- the low-hanging fruit has been picked. you have to shake the tree. that's the way i think of how

activists think about it. >> we'll see. a lot of those discussions and strategies remain unresolved. southwest has a big one. this fall going to be interesting to see how some of the remodeled boarding seats, boarding processes changes the equation. let's get the opening bell here. at the big board, it's digital banking company q2. and at the nasdaq, it is smoky bear and the new york state department of environmental con very ve conservation. we are getting some haze in new york because of the smoke from canada. >> i do have friends in, of course, california, talking about the constant alerts that they're getting as well. so, see if that has any, you know, knock-on economic effects there. as far as levels go, 5,530 here. is the 50-day interesting to you? >> it's interesting that we shot right above it in a relatively quick way. doesn't mean it's game over. actually, the pullback we had

back in april, you also did get 5 or 6% down, climbed right back above the 50-day and then had to fight out that battle for a little while. it's interesting. i think the nasdaq 100 is just at the 50-day. it hasn't really cleared it, so it's one of those benchmarks to say, okay, are we going past an obvious level where you -- where people might sell or take profits or consider resistance and not paying attention to it? that's probably net bullish if that's the case. you have some room to work here, though. the low intraday was just about 5,100 on monday, first monday in the month, and you know, obviously, you have a little bit of room here to just chop around. >> interesting tidbit out of the goldman desk today. it feels like this fast snapback, they argue, does make any gross up post labor day a little bit more of a climb. look at what nvidia's done in the last couple weeks and they've got earnings coming up on the 28th. >> it seems like it's been a

very compressed process where you had this complete flight from risk liquidation moment right back at the -- around the yen carry trade, but it also was every strategy based on continued calm and very low correlations among different assets and all these build-up of sort of like things are fine-type strategies. they all got cleared out, and then now, the market didn't really do a lot of work retesting the lows, and you have to chase nvidia, maybe, or don't fight it into the earnings. i do agree with that. >> at the time, that's something you were looking for, maybe, to see a little bit more of, yeah? more of an overshoot to the downside. >> i'm always looking for the fatter pitch or looking for that thing that says, you know, you kind of wring the hope out of the short-term tactical community, but you know, a lot of work was done. the national association of active investment managers, these are market timers, short-term trend followers, things like that. they really cut back from very

elevated exposures down to pretty low neutral in a week. you know? it just seems like it happened in a hurry. what i do find interesting, a lot of folks are pointing this out, like jeff degraaf at renaissance, is that bond yields haven't had as much of a move. >> yeah. >> they didn't bounce that much. now, it could just be, look, if the fed's going to be cutting, the direction of surprise maybe is going to be weakness in the economy and not strength. it's just sort of not confirming in a vociferous way this move we've seen celebrating the resilience of the economy from retail sales. >> right. the other -- you mentioned the carry trade. there are a couple pieces on the tape today looking at a bit of a comeback for that trade, given what's happened to the yen since august 5th. >> if you're looking at the market clues and saying, it looks like people are willing to reload, sure, i guess that's the case. i tend to think it's usually not sort of the same snake that bites you twice in a way. you get really fixated on that dynamic and certainly it hasn't gone back to where we thought it was. i was looking at the -- i mean,

this is real wonky, but the implied correlation index for the cboe basically says, how much are stocks moving together as one or doing their own thing? there were record lows in terms of correlation right before the shock shot higher and we've receded back to normal levels, not extreme lows. i think we can sit here for a while and be fine as we await the next sort of macro turn. >> you mentioned we were mentioning the china weakness and how it's impacted some bellwether retail names. it's also getting -- we menti mentioned amat and their china mix. the wells desk today says it implies the decline of china revenue and the other is on oil as we got below $76 today. a lot of that's on as china continues to export deflation pressuring steel, pressuring iron ore. >> exactly. >> and you know, it's basically gold and every other commodity

is going totally different directions. gold driven by, obviously, its own dynamics. amat is one of the biggest losers near the open for the exchange. so, it's, in a way, a similar story, you know, in the sense that, you know, china, as the swing factor, in terms of, you know, marginal demand, raw goods and all the rest of it, i guess we're probably past the point of wishing for that disinflationary wave to help us out, you know? it seems like that the inflationary dynamics are more tame than they were for a while, but you know, i think we've kind of done okay without it. that's the other piece of it. i mean, company by company, you're struggling, but in aggregate, it feels like we've stopped relying on that. >> right. speaking of china, one company with a lot of exposure is tesla, and today, bernstein, tony sacanagi says the loss has been

most acute in north america. tony would argue and i'm sure will again in person that the valuation is getting further removed from the fundamentals. >> if you're just doing the what's in front of us, you know, units times price and profitability, you can't really get to where the stock trades, and you never have been able to, at least not in the last few years. the plan, so to speak, was always that they were going to cede market share over time because they more or less had a quasi-monopoly on battery electric vehicles and everybody else was going get involved. just the fact that they're no longer as dominant, i don't know if that's news but it's stark when you look at the implication for the numbers and the reminder that there hasn't been a real refresh of the model slate very much, one that's taken hold. the pricing doesn't look as great relative to some others. it was $177, the price, around there, in mid-june when shareholders backed the musk compensation package and the

collective conclusion there was he's not leaving, and we're fine. and so, you still have to have some kind of assumptions in there, trading above 200 bucks, for non-car businesses. of course, self-driving and, you know, what, last week was supposed to be the event. >> yeah. >> didn't happen. he forestalled it. you're always in that zone with tesla of how much value do you put on the what if parts of this business down the road? >> right. a little media here. there is a double upgrade of fox over at wells. they argue it deserves a premium to wbd. they're above consensus on 25 and 26 ebitda, and then you got paramount and this go shop, which expires in just a couple days, and these reports too. >> yeah, i mean, it's sort of fascinating. names from the past who tried to make a play before. it is, you know, worth, i guess, repeating that, of course, the deal that's now been agreed upon

is not a sale of the whole company. there is -- in theory, if somebody came out and said, we have a premium for all shareholders and it's a clean deal and it could be financed, i guess you have to listen. don't think the market's putting a tremendous probability on top of that. i think the other argument you have to make is, if their balance sheet's in a little bit better shape after the capital infusions of the -- of this deal that's on the table, skydance deal, are we bottoming out in terms of just the general cash flow dynamics for the legacy businesses, and then you just sort of go from there. whereas fox, i mean, more targeted, a narrower company, not as burdened by a lot of the, you know, the sort of cord-cutting specific risks, even though they're big in cable, and it seems as if it's a cleaner story in general. >> you know what's interestingly weak today are some of the travel names. airbnb, one of the worst performers.

expedia. we've heard -- i mean, it's been discussed for a while now, "the journal" piece about travel trends, budgets softening, obviously, the companies themselves have issued some cautionary words in the last couple weeks. it's hard to separate that from what -- it's back to school. people are, i mean, summer travel season is ending. >> sure. >> so, is it about seasonality? >> it does seem as if there was too much of a pile-up of disney, airbnb, the hotel chains, everybody essentially saying there's more slack in demand. actually, just this morning, rbc, laurie, has a proprietary gas station visits, like, gas station traffic, and if you look at just -- it accounts for seasonality, and we're running below the last three years this time of year. slightly. and now, even though gas prices are lower than, let's say, last year, and the argument there is just less domestic road tripping. it could be a little bit of, you know, weakening demand because of higher mileage cars and electric and all that, but i don't think that would change that much, so the point is

there's just been a little bit of a cooling off. it's not, you know, it's not stark. it's not like, you know, anything close to 2020 or recessionary. >> of course. >> it's much more just, you know, we went there, we did it, and we don't need to do it again. >> we'll see. we know airfares have been one of the components that have been friendly to a disinflationary thesis. >> for sure. >> we'll see. you know, it's probably worth revisiting walmart to some degree. td cowen, great note on how the -- they beat on gross margins so handily. it's about a net -- it's a drop in their net costs per delivery by some 40%. >> right. and it's really become kind of an execution story, and an incremental -- an enlarging of their market in e-commerce, and then making that more efficient, getting to scale. so, it sort of complicates walmart as a macro tell a little bit. it used to be, like, uh-oh, the trade down or it's value-led and some of that is certainly going

on, but because they have their own things going on, and they're kind of enlarging their pie, and advertising and all the rest of it, it's, to me, a little bitless less of, oh, you have to worry when walmart outperforms this much. costco owned anything mainline retail. >> but because of their internal bellwether or internal flywheels, advertising, all these new silos that even with their size it's hard to move the needle, you think as a pure consumer bellwether, it gets muddied? >> i think it gets muddied in the sense of, on a relative basis, if walmart is outperforming by that much, compared to the, you know, the targets and everybody else, it isn't just about, oh no, that's a prerecession signal. that used to be the textbook play. you'd say, uh-oh, it's a walmart economy or a dollar store economy. we have to worry about the rest of it. >> we'll see. we're going to get target in the coming days, a lot less reliance on grocery. speaking of names that are getting a second look today,

cisco, hsbc goes to buy. they argue that the guidance is actually stronger than it looks, beca because, in their words, it was politically tactful to issue guidance on a day when you're cutting another swath of employees. >> it is plausible. i think the general message is, this is not a stock where the valuation requires you to have heroic assumptions about growth rates. i guess you also have to point out, cisco has had times where they've missed their own guidance. it's not like they're just completely sandbagging here. this is one of those 8% free cash flow yield, i mean, it's valued, like, kind of runoff legacy-type, web 1.0 business like ebay or something right now, so if you think the guide is achievable, their faster-growing segments can start to make much more of a difference and be a bigger part of the whole, you know, a.i.-levered type stuff, then it's easier to make the bull case at these valuations. >> we'll keep our eye on that. for the most part, most sectors

are mildly in the red. energy by the most. let's get to bob pisani this morning. >> good morning, carl. sort of a mixed open right now. tech is lagging again, but that's been the case for the third quarter. interestingly, real estate and financials, particularly banks, are leading, and that's a very interesting phenomenon here. we are halfway through the third quarter right now, and i just wanted to give you a quick review of what's going on. i think it's very interesting that the leadership so far still remains the small caps despite that terrible week we had in small caps last week, the russell 2000 up 4.3%, the s&p 500 equal weight up 3.7%, and they're outperforming the s&p 500. this is the first six weeks here, halfway through the third quarter. s&p is up 1.5%. nasdaq is down 1% here. so, if you look at the leadership groups here, they're interest rate sensitive sectors so far. real estate is leading. utilities are leading.

that makes some sense because we've seen interest rates trending down, and that's a good sign. financials are also leading, and i mentioned banks as a leadership group here. it's good to see themrallying because in a sense, they're interest rate sensitive but they're also economically sensitive. so, it's good that the financials are in the leadership category as well, and then we have some defensive sectors, consumer staples and health care perhaps not terribly surprising. the laggards are growth and cyclical, so tech's been a real laggard. it's very interesting. tech was the big story in the first half of the year, but not so much in the second half of the year. energy is also a little bit down. oil is lower this quarter. perhaps that's understanding, and consumer discretionary and communication services are the big laggards, down almost 4% on communication services. that's because alphabet is disney have been big laggards. they're so big, they've been dragging down that particular sector. both of those stocks are down about 10% in the third quarter. so, if you look at mega cap tech, with the exception of apple, all mega cap tech stocks

are essentially down a little bit here. nvidia, microsoft, amazon, alphabet, as i mentioned, down about 11%. meta is down about 6%. so, big cap tech has not been the story, the major story, in the third quarter so far, and it's really remarkable. we're really dealing with two different months. july was fantastic, and august has been horribly choppy right now. as far as the earnings, which is what i follow very carefully, they're holding up very well. the third quarter expectations were up almost 6%. that's a little bit lower than it was a month, month and a half ago, but that's very typical as you finish the first month of the new quarter. they lower the numbers a little bit. the third quarter of last year was very, very strong, so the comparisons are difficult. so, we're up about 6% in the third quarter, and the rest of the year, this is what i was -- i'm saying. they've not dropped the numbers, up 12, 13, 14% when you get into the fourth quarter, first quarter of next year, second quarter of next year, up 14%, those numbers have been very, very stable over the last

several months. so, i guess, guiys, for me as te stocks guy, looking at the earning, is there a fundamental reason for the downturn that we saw last week? i don't particularly see it. i see inflation trending lower. i see cuts expected in interest rates. i see slowing growth but no recession out there. and i see earnings holding up. guys, there's a reason why the market's holding up very well, and most of the indicators still point to the economy holding up reasonably well. back to you. >> all right, bob, thanks for that. bob pisani this morning. as we go to break, let's check bonds as well. we mentioned goolsbee's comments. we got housing starts under our belt. really on a friday, it's about umich and we'll get that in about 15 minutes at the top of the hour. for the time being, ten-year just south 3.9%. don't go anywhere.

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market has seen sales fall double digits from their peak frame in 2021 and 2022 with a number luxury auto brands looking to reverse the trend by going hybrid. robert franks in california with the details. >> this is the biggest classic car event of the year in the world and right now in the classic car world, the hottest segment are 80s and 90s supercars like these lamborghinis. when it comes to the new supercars, it is all about hybrids. lamborghini, in a couple of hours expected to launch its latest hybrid, so all of its lineup will now be hybrid. bugatti recently launching a car that has 16 cylinder combustion engine with four electric motors, 1800 hp, 0 to 60 in under two seconds. $4.5 million, already sold out.

why are hybrids so popular with the wealthy? they get the benefits of the emotional engine combined with performance and virtue of the electric motors. >> with all the hybrid and the supercar world we cannot achieve full performance so with a pure combustion engine car, you can have an emotional compensate but you miss the performance. it is an arms race and you need to have at least a hybrid car to keep up right now. >> so much talk about what is happening with the high end consumer. speaking with the ceos about if they have seen any lowdown in orders, traffic at the dealership even in preowned and right now whether you look at the used market or the new, they have seen absolutely no slowdown with orders stretching out two or three years.

despite price tags starting now at 400,000 or $500,000. >> what do you think it says about the. plate electric vehicle ability to pull in drivers with some kind of emotional pulling? >> that is the challenge, ferrari will launch its first all electric ferrari next year and they promise it will have the emotional connection of a ferrari which of course they are famous for the rower, the sound of the ferrari engine. they say that the engine will have a sound, but that is the reason why these supercar makers have been signing a breath of relief because they have the benefit of lower carbon emissions and better performance. so they are electrifying, but giving customers what they want. the question will be, does anyone want an all electric supercar? the owner of bugatti, they make one electric supercar, 2100 hp. so you may have buyers who love

the performance of the evs, they buy it for that reason, but they will never have that emotional feel of engines like. >> robert, you know, obviously it is not a cost thing for people buying these cars, for the mileage for the. combustion engine like 10 miles per gallon, but i wonder for the companies, they have to probably be thoughtful about production levels on all of these different types of models because they make so few cars in the first place, what is the bet on enlarging the market away from gasoline engines? >> that's why they are trying to stay flexible with production. trying to say if we continue to produce combustion engines we want to make sure we can do that. we will produce hybrid engines and have flexibility later to produce some electric vehicles, but they ant to do all three because no one knows what that demand will be like.

so, for now, they will provide and make all three, but the production for these companies is still fairly limited. so they can have the flexibility. >> pretty interesting watching that high end of the market. once again that is robert frank. now watching the markets, s&p is down by five, holding gains for august by 15 points. stay with us. your record label is taking off. but so is your sound engineer. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire

good friday morning, welcome to another hour of "squawk on the street". i am carl quintanilla and the market looking close to the flatlined the dow up 15, s&p down three as we continue to process data points. the better jobless claims, the strong retail sales and we are 30 minutes into the trading session, the three movers we are watching now.

applied materials shares moving lower despite posting better than expected third-quarter earnings with shares off by almost 4%, the company forecasting cue 4 revenue above wall street estimates with a surge in demand because of ai. shares of h&r block spiking, the tech service beating on earnings and revenue is 70% dividend hike at 1.5 alien dollar buyback, shares are up 17.3%. shares are climbing after a legal victory in it suit over claims that exposure to its popular roundup weed killer led to cancer, shares are moving higher by more than 11% for bayer. >> consumer sentiment out and here are the numbers. >> some surprises here. looking at the headline, expecting a whisker below 67. we end up with 67.8 which is the best since just june.

know what's very important is last month at 66.4 that was the weakest level going back to november june. know what's very important is last month at 66.4 that was the weakest level going back to november 2023. looking at the current conditions, that 60.9 is three points below what we were looking for and that's the weakest since 22 matching the rearview mirror of 62.7, that was the weakest since december 2022. now moving toward the expectations, what may lie ahead. 72.1, a better number expected at 68.5, the best number since april and finally, the inflation numbers and this is always important. one year inflation expected 2.8, it was 2.9 explaining why rates have moved up a little bit. that equals the rearview mirror, but 2.9 is good news even though we did not make any progress, that level last month and this month is the lowest one year inflation on the survey going back to 2020.

funnily looking at 5 to 10 year inflation, a similar scenario looking for 2.9, comes in at 3%, matching 3% from last month and 3% now one, two, three, four months in a row. if you go prior, the low for the year was 2.8 in march. these are preliminary, so in a couple of weeks they may change. back to you. >> as we said stocks are a bit mixed in the early action. s&p and nasdaq on pace to break their losing streaks. now, we are looking at some of the movers today. >> the market action now was positive earlier on, now it could be on pace for the best week so far this year in the stock market overall. from a market cap perspective, the small-cap etf and the mid- cap as well. you can kind of see relatively good across the board, but the large-cap outpacing what is happening with the mid-cap and

a little better than the small- cap. very good on a weekly basis, with regards to the ectors in focus for the larger s&p 500, as of now, every sector all 11 are higher for the week and notably the technology sector, the consumer discretionary sector and the financial sector are the three best performers so far this week. for those people who look at the economic cycle trade perhaps that does vote well for where the momentum is. tech, discretionary financials doing very well. stock wise, computer chips are very much at the forefront on a one-week transaction basis on the s&p 500. supermicro, nvidia and micron, three of the top five performing in the s&p 500. we will see if that momentum continues. a couple of news driven stocks have been among the best performers. shares of starbucks with the ceo change and nike shares,

these have been languishing, but nike after disclosure of a big steak from bill ackman come of that is driving the stock up 11%. starbucks and nike, the standouts. back over to you. we are getting economic warnings from the chicago fed president, now what did you hear, steve? >> in comments that sound like a fed president want to cut interest rates pretty soon the chicago fed president morning that the fed has to be careful not to stay too tight for too long. talking to npr he said you don't want to be tighter longer than you have to and the reason my is if you are afraid the economy is overheating this is not what overheating looks like to me. we have had mixed signals with the economy. member the jobs and unemployment numbers were up, housing this morning coming out week, jobless claims have been

moderate, not sending much of a warning signal and retail sales were strong. all of that combining our rapid update before housing came out, but before it was compiled, 2.4%, for the third quarter. the probability of a rate cut in september reflecting uncertainty about the economy. 73% for the rate cut in september at 27% for the 50 because of strength and retail reporting. with market awaiting guidance from the fed at the annual summit, we got some advice on how to think about the coming data. >> i do think that there is special importance in what we hear about the labor market. if the next print early september looks like the average for the last several, i would be inclined to think that they go 25 and signal more. if it is a disastrous report with negative payroll, then we go 50. i think it is data dependent

for the first move. >> this is what the probability looks like in the futures market. 73 in september, 59 for another 25 in november and pretty much 60%, a good number with confidence and another 50 in december for a total of 100 by the end of the year. this is what's coming up to determine this. you have the jackson hole speechwriter, the pce one week later, a week from that the jobs report and then september 11 is the cpi and so a lot of data to come that may answer the question of how weak or strong the economy is along with a lot of the fed speak from jackson hole. >> high profile earnings like nvidia mixed in. stick around we will talk about next steps for the fed. let's bring in global investment ceo, bob good to see you. i know you argue there's little

evidence the economy is weakening, but there is pressure on the central bank to ease. it's fine how both can be true. >> i think there is evidence the economy is weakening with the employment reports weakening, inventories are building, delinquencies are moving up. credit card use moving up. they are all signs we are starting to live on borrowed time. i think the fed will get started as we all suggested probably 25 in september with a hint that more are coming. >> steve, do you think that gets telegraphed pretty plainly next week? >> yeah, i think on a topline basis that is right. i am really interested in this idea of risk management which is one way the fed can run monetary policy. we don't know if the economy is weak now or weakening. it is okay at 2.4%, for the third quarter with 1% retail sales, but we may want to put

ourselves in a position to address that weakness if it should come up. the thing that's going to be on my mind next week is how far do you think you are from neutral? how much can you give and still be restrictive putting downward pressure on inflation that still remains and yet be in a position to easily provide stimulus for the economy if it turns out to be needed? >> we also had a growth scare combined with some of the relativity catalysts in terms of positioning and all the rest, but still up pretty appreciably, the headline index for the year. where do you think we sit in terms of expected returns and in terms of whether earnings come through to justify where we got to near the all-time high? >> you know, i agree with steve that the fed wants to signal that more is to come. we think about the absolute number, they are over 5%, there

are not many nominal data points at 5% so, they are restrictive in what they are trying to do. in terms of the market. it is digesting an incredible amount. in the beginning of the last error you covered how the trade is behind us, a lot of evidence with quantitative and systematic managers applying corporate buybacks picking up. earnings were good in the second quarter, but on the other hand the third quarter estimates at the margin have been cut. a lot of cross currency. paying 23 times earnings for the s&p 500, things better be really good at 23 times. >> steve, the idea that you want to get down to a level of rates for you are not that far from being accommodative, i mean , it seems to me you have a lot of premises and assumptions about where's the neutral rate and whether the economy

responds to the direction of travel with how rates are going and how fast they are falling in the absolute level. do you think we will get that granular from powell or anybody else next week at jackson hole? >> you are making me quote yogi berra, making predictions is really hard especially about the future. the fact is, the fed has to have a forecast about where the neutral is and where the economy is going and how best to position yourself from a risk-management point for the predict futures. hey, it's probably going to get it wrong by some amount. it is already too high in the aggregate or median forecast for inflation this year it is too high, inflation is coming in lower. so i think it has to do with saying okay what i like to say is pick a neutral rate and go with it. let's say it is around three and what bob said is really interesting to think about. nothing in the data suggests neutral is five, so you have

some to play with. you can take off 100 and you would be a lot closer to any perception of neutral then you would be if you stayed at 540. so that is an idea. i think it's why the market is minus 100 for the end of the year and looking further down the curve, minus 200 for next year so where does that get you? 340 in a years time, still above the neutral rate according to that theoretical construction. still restricting the conomy one year from now. >> we will talk a lot for next week and next friday with your help, steve. as we look forward to jackson hole, bob, as always, appreciate your guidance. quick programming note, don't miss coverage of the jackson hole economic symposium next thursday and of course on friday we will hear from the fed chair live as he begins his remarks on "squawk on the

street". as we go to the break, for the rest of the hour, the vice president outlines her economic plans later today, including big proposals for the housing sector, plus drug companies making a deal on medicare prescription pricing and down paying its overall impact. betting big on the experience economy, we are live in california looking at one company capitalizing on the ongoing demand for concerts and live shows. we have a big show ahead ourselves, "squawk on the street" is back right after this, don't go away. ng new treatment advances can make a new tomorrow possible. better questions. better outcomes.

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housing coming in at 1.24 million in july, the lowest level since may 2020. building permits also at the lowest level since june 2020. our next guest says fewer than 1/5 of consumers believe now is a good time to buy. fannie mae chief economist doug duncan joins us. seems to be fairly ersistent, when do you think that might turn around? >> that will depend on house prices and interest rates. we expect the fed will cut a couple times, the margins ringing down mortgage rates a bit although the 10 year versus 30 year fixed rate is not in lockstep, but we do expect there will be some additional decline if the fed does as expected. that will improve things a bit, but from a store perspective, we are at one of the most

unaffordable time periods that there has been, certainly in the post 2000 time period. so we have a ways to go. the other issue that is out there is, in our portfolio, 88% of people with a loan are under 6% and 81% are under 5%. there is a significant share of those folks that are unlikely to let the mortgages go anytime soon. >> the interesting thing, i was having lunch yesterday with a mortgage broker from new england who says she has been inundated with client requests for her services on mortgages. where is that activity coming from? >> it is refinancing people who took a mortgage after say 1 july in 2022 when the fed started getting tight and mortgage rates went up rapidly. so anybody that has taken on a

mortgage since that time period may well be in a position to refinance. we actually track that. we have a rally, the refinance application level index that is a measure of the flow of application activity and in the last two months as the rates have come back down or the last two weeks, i'm sorry. there has been a big jump in the applications for refinancing. >> so according to the notes that i got from you guys, here you have got the conforming loan balances falling slightly 6.54%, down like 1/100 percent, basically flat. are the tiny moves enough after seeing interest rates high for this period of time is that enough to get people have been chomping at the bit to say fine, i will do it now? do you see that? >> going back 30 days ago or so you would've seen rates closer

to 7%. so dropping 50 basis points is a pretty big drop and will bring a bunch of people into the market. if the fed does as we expect and rates come down further , we expect refinancing activity to continue. bearing in mind that 2021, and the first half of 2022 we were at very high levels of refinancing themselves and those folks will not be back in the market. >> you mentioned mortgage rates do not move in lockstep with say the 10 year treasury yield, but it seems the gap is higher than historically, it has been. there are a lot of factors, but some of it is about assumptions about prepayment and refinancing or maybe bank willingness to get into the market. what is driving it and what can we expect? >> the thing you mention are part of it and part of it is the fed portfolio. the biggest holder of maturity

-- mortgage-backed securities in the world. as the fed is letting that runoff, one of the questions is who replaces the fed in holding the new issued mortgage-backed securities? so there is uncertainty about who will step in, and at what rate. as you mention at the same time, rates are coming down changing probabilities of people refinancing existing mortgages which is a risk so that means it will stay wider to account for that additional risk. >> finally, have you been able to look at the reports about the vice presidential plan that we may hear about today offering down payment support to first-time homebuyers. if it were to become a reality how much is policy loaded to make a difference? >> we don't really comment on specific platforms, but think

about the fundamentals of supply and demand. the issue in the market today is a lack of supply relative to the demand. the reason why even though the level of activity has fallen off, house prices are going up. because there is still a great strength in the demand side and the supply side of the equation has not caught up to that. i would caution one note about that interpretation of the data that came out this morning on construction. that downturn was heavily concentrated in the south and texas is in the south and is the biggest market of home construction and the urricane went through there and shut down starting part of that. >> that is a great clarification. thank you for pointing that out. doug duncan, great to talk to you today. >> still to come watching the pharma sector as the white house

makes deals on medicare prescription drug pricing. drugmakers downplaying some of the overall and we will talk about why. plus, check out some of the biggest gainers on the dow for the we. ek we will be back in two.

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the biden administration reaching deals with big pharma to knock down the cost of some medicare drugs, but the company is downplaying the long-term impact for now. joining us now to expand, good morning angela. >> the administration is touting huge discounts, but most of these drugs are already coming with big discounts and only two of the 10 prices represent significant cuts from the current net prices, this is according to ss are help provider of net price data for prescription brands. these first 10 drugs are older names that are less important to these companies. some of them will face generic competition by the time the prices take effect in 2026. it is important to know this is

only the beginning with more drugs getting added to the list every year and by the time we get to 2030 there will be 60 drugs that medicare can negotiate prices of and as the list grows you're going to see newer medicines that are still really important to these companies. one watch is ozone pick, a lot expect that drug to be on the list in the next round and then 2028 drugs given in doctor's offices will be included which means cancer drugs could make the list. this is important because these medicines do not come with big discounts like the initial drugs so those percentages that the administration is touting will be closer to reality and one analyst tells me they have further to fall. >> angelica, what is the basis on which the government is determining which drugs they will go after in terms of negotiations, the number of people using them, how heavily they are prescribed, or is it something about the initial list price that makes the

government go and seek better ones? >> right now with the first 10 drugs, it is the drugs with the highest gross cost to medicare so that is why some say you are seeing a little bit of an imbalance because although the list prices are quite high, the actual net prices are not as high. when you see part b coming into effect in 2028, there will be a difference because that price is different. it's the average selling price so that's closer to what you see the drug costing. right now there is an imbalance on the drugs costing the most versus what we will see later on. >> have we heard the industry pushing back on this whole episode in that it would endanger i don't know, r&d budgets, things we have heard historically? >> you are hearing a lot of that. yesterday i was in touch with these companies and across the board they say this will have a chilling effect. on research and development.

they say it will have devastating consequences for patients and the real risk of course is, in the future, what this does to investment. they said will this incentivize them to make these big investments because they are going to have less time to make return on the investments and especially when it comes to pills because there something in the actual regulation here that allows pills to be negotiating before more complex biologics, so they say this will be harder. >> and of course the demand for patients are for pill forms of the medications, rather than shots. as most people would prefer. angelica, thank you. still to come, democrats looking to embrace cryptocurrency's as million- dollar donations are rolling in. we have details afr a tequick break. you need to hire. i need indeed.

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welcome back. now with your cnbc update, gaza cease-fire talks resume today with negotiators trying to find an agreement that could end the war between israel and hamas and avoid a regional conflict. the middle east is bracing for an iranian attack on israel. anger boils over in india as doctors march for justice and the brutaland murder of a doctor who was taking a nap during a 36 hour shift. a suspect has been arrested, meanwhile the indian medical association is calling for a nationwide shutdown of most hospital departments in the country starting saturday exempting essential services. hurricane ernesto is now just a couple hundred miles away from bermuda according to the national hurricane center. the now category two storm is expected to bring life-

threatening flood and storm surge to the island with forecasters believing that ernesto will arrive in the next 24 hours. back to you. one hour into trading, the dow done 100, stocks are trying to close out with a recovery rally. almost 5% gain as investors look ahead to vp harris and her economic policy. joining us to discuss all of that, senior chairman roger altman. great to see you. we have been asking a lot of guest about last week's growth scare and i wonder if this one seemed more interesting, more dramatic in any way? >> no. the soft landing scenario is just fully intact. look at the retail sales figure we just saw. real consumer spending running about 3% year over year which is impressive. walmart, 4.2%, same-store sales

growth, that is remarkable. unemployment claims moving down, manufacturing is slightly up and of course, we are looking at the fed finally making a turn, making the case for three cuts between now and the end of the year is a strong case. 25 basis points each time, we will see. that will be data dependent. of course the markets themselves have recovered entirely as you guys have been saying. the losses from a week ago, the fix is back to 15. 10 year treasury is about 390, not sure how you could have a more benign macroeconomic scenario if your goal is a soft landing. what are the flaws? it's hard to find any. >> some may point to just crossing now the atlanta fed down to 2.0, they were at 2.9. some rule gets discussion.

comments about when the labor market worsens, often it gets worse very quickly. things like that so when you start to worry? >> welcome i would worry if the labor market cracked. i don't think that's going to happen, but you can never be certain. by cracks, i mean negative monthly job growth for example. but i do not see any sign of recession. when you see the atlanta fed growth tracker is 2%, because we all want cooling, we see that cooling. you want cooling, but obviously not a precipitous drop. and we are seeing that in growth, we are seeing that in labor markets, down to give or take, 150,000 new jobs per month at the current rate. that's the cooling you want, so course there is no guarantee against a sudden crack, but i

do not see it. >> we are expecting vice president kamala harris to outline some of her economic policies and priorities today. we are looking at how she plans to tackle inflation. she says you must offer tax credits for builders and first- time homebuyers, offer down payment assistance up to 25,000, pledging a ban on corporate price gouging. boosting competition in processing and then re-imposing a child tax credit, expanding earned income tax credit, reducing taxes on health insurance and limiting drug prescription spending. do those plans seem like they will encourage growth in the economy? >> first of all, i think most of these initiatives that are being laid out today would have been part of a biden/harris second term had president biden

remained in the race and successfully won. so i do not think much of this is a big surprise. certainly, the housing initiatives are consistent with what president biden has been talking about with the innovation fund. incentives for the first time home buyers in particular. same with child care tax credit. after all, during the andemic we had the expanded childcare tax credit lowering child poverty by 15%. why that was not extended is a mystery to me. it should have been. this is a deeper set, but they make sense. in terms of proposed federal ban on food price gouging or grocery level price gouging. to me, that is the equivalent of job boating because it's not likely the democrats will have both houses of congress at the

beginning of next year. therefore, this is not likely to pass. i think the harris team knows that and it is the equivalent of trying to get meat producers and others to think twice about raising prices. after all, grocery margins rose during the pandemic and they have remained above long-term historical levels. so there is a bit of a paradox there. i think this is trying to address that. >> caring.com did a survey of senior, older americans who are working. one in three say they are working because of inflation. because they had to pay higher costs. let me get to the trump inflation plan cut energy and electricity by half, drill for more oil, extended 2017 gop tax cuts and undo every regulation president biden has passed. in what way do you think that could spark growth in the economy? >> i don't think it would.

what you did not say is the trump tariff proposal where he is proposing a 10% tariff on all imports. if we know the very high tariffs on imports from china, you know the peterson institute for international economics which is a nonpartisan organization has estimated this would cost the average american family, $1700 per year. the equivalent of raising taxes by that amount on middle-class americans. i don't know how that makes sense or how that is pro-growth because it isn't. and fully extending the 2017 tax cut which fundamentally targeted high income individuals and corporations, i don't think it's pro growth either. so if you ask me if the trump addenda is pro-growth i don't think it is. i think it is a pro inflation agenda and i don't think it is in the same realm as the

biden/harris agenda. >> i think the tax policy center has it at $1800 a year. we will see what the afternoon brings. always appreciate the time, thank you. >> my pleasure, all the best. legislation on cryptocurrency turning into a key issue for the election. emily wilkins down in d.c. with more. >> crypto has become a major player in campaigns and it's not just donald trump, democratic leaders are embracing crypto now they are hearing the promise to move legislation before the end of the year. this is backed by coin base, they announced they will spend 6 million on advertisement buying for democrats in key states, those from arizona and michigan, each get 3 million. other democrats praised innovation behind crypto and vowed to pass a like a tory framework providing the

industry with more stability and room to grow. senate majority leader chuck schumer on the crypto for harris call from earlier this week says it was his goal to pass the crypto bill by the end of the year and he mentioned a bill from a senator establishing clear rules of the road for trading crypto tokens. exchanges, brokers and dealers would have to register and the ftc would have the power to protect consumers under the bill. democrats may be warming up to the crypto group, but the strategy is to keep it bipartisan. we have seen fair shake donate to democrats, but they plan to spend 25 million on ads in house races. nine democrats, nine republicans all incumbents all-pro crypto and they will put 12 million into those ads backing a republican challenging the ohio democrat brown who has been skeptical of crypto during his time in congress. lawmakers are urging the harris campaign to embrace crypto and we will see if kamala harris

says anything at the dnc next week. still to come, from wall street to main street, a new survey shows small businesses are ready to lead a new wave of economic growth. we will discuss what the ceo of chase business banking has to y,sa we are back in three. you can sell your policy - even a term policy - for an immediate cash payment. call coventry direct to learn more. we thought we had planned carefully for our retirement. but we quickly realized we needed a way to supplement our income. our friend sold their policy to help pay their medical bills, and that got me thinking. maybe selling our policy could help with our retirement. i'm skeptical, so i did some research and called coventry direct. they explained life insurance is a valuable asset that can be sold. we learned we could sell all of our policy, or keep part of it with no future payments. who knew? we sold our policy. now we can relax and enjoy our retirement as we had

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it has been a banner week for the stock market as it tries to continue to bounce back from that big selloff a couple weeks ago. how are some traders narrowing the search and screaming for the leaders of any potential move higher from here? tune into our market navigator segment later today power lunch 2:00 p.m. eastern time.

welcome back to "squawk on the street", consumer spending is holding up, but there are concerns under the surface according to a midyear survey of small business leaders,

inflation remains a top challenge, 20% citing uncertain economic conditions and 17% say rising taxes are an issue. just under half are concerned about ai and its impact on business. chase business banking ceo joining us to talk more about it. always something to worry about if you own a company so what in particular do you think ai represents as a challenge to a lot of these ceos? >> for most small businesses they don't know what to do with it yet. you hear a lot about big business and limiting large language models and other ai, we are certainly doing it. i was surprised half of small businesses plan to use ai over the next year. so they are embracing it but they also don't have tools at their disposal that bigger businesses have. >> they could get disrupted on some level? >> they think they could get disrupted or use the tools wrong. it's a little bit of a balance, but overall they are pretty

optimistic. >> what do you think the easiest on-ramp is for a small business owner to integrate? is it about coming up with some ad or design that would be involved in marketing or is it more operations? >> it is industry specific. professional services will use it to take efficiencies something about knowledge workers becoming more efficient. worker output goes up and that's huge. in a space where wages rise that is leverage for a small business and on the other side if you are in manufacturing or operationally intense you will apply it there. >> have wages and quality of labor gone way down as a top worry? >> they are still pretty high, but now stabilizing. when it came to talk to you in thanksgiving they were worried about wages going up, it has eased off. overall, if you look at the results of the survey which lineup with our friends we see more optimism than we have any

while. 75% expect good things this year. 67% say good things for the local economy which is the leading indicator and even over half say good things about the national economy. we actually asked customers how are you feeling overall about your business for the last five years and 60% feel better today than they have at anytime in the last few years so that goes back to pre-covid. we tell it like it is. >> what about benefits? how much is that a factor in the way small businesses think about factoring in for the future? >> benefits are a factor, healthcare goes up, but if you look, they spike for while, 17% of which cost up to 20 for the pandemic now back down to 17. so, we see it as an issue, but not anymore then wages. what surprised me is energy. we hear a lot about energy cost.

prices at the pump are down but utility costs go up and small businesses in general pay more than consumers so it might be cheaper to fill up at the pump but it's more expensive to keep the beer cold inside. >> thank you for breaking it down. still to come, nike with a record double upgrade. one for moving from selling to buying, taking the target to 93. meantime let's get to los angeles with a look at what's ahead in the show. >> what you can see here is manchester united soccer stadium getting ready for a big match, but i'm not in england i am in los angeles and this is a giant led dome streaming and it will be streaming games happening thousands of miles away. i will tell you how the billion- dollar startup is trying to create a new kind of live event. coming up after the break.

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gina costa... looking simply stunning... what's this? she's opening her fidelity app.... to buy that stock... with no fees or commissions... because what does gina got? gina's got the look. that never gets old. talk about easier investing. welcome back to "squawk on the street." with concert spending holding up and record sports rating on television, one startup is betting big on live experiences and sports. julia boorstin is live on the scene with the latest there in los angeles. hi, julia. >> contessa, right now i'm in a dome that a startup called casm

designed. this wall-to-wall curved l.e.d. display behind me wrapped around the 750 people who could fit into this space. cosm is partnered with the nba, ufc, circumstance circumstance along with premier league soccer matches. that's what they're getting ready for right now. now, ticket prices range from $22 to as much as $200. but they average at $33, which cosm ceo tells me is a sweet spot. >> and as you look at some of the potential headwinds in consumer spending as a whole, we think we can provide an option now, which might be more approachable on a regular basis. we want you to come back time and time again. we're not priced to be a once in a lifetime or once in a year type experience. my hope is that you can come back every week. if you like college football,

come back every saturday to watch all the games. if you like nba asketball, come back every week. that's really how we've priced it. >> in july the company raised $250 million at a valuation over $1 billion there backers like avenue sports fund, cleveland cavaliers' owner dan gilbert. cosm opened this location in july is launching in dallas later this month and in atlanta in 2026, aiming for as many as 40 of these venues by the end of this decade. now, cosm isn't the only one betting on live sports. theater chain amc has been showing live sports and concerts and imax screened paris olympics coverage. guys, right now they're prepping for their inaugural premier league match. that's today at noon pacific, 3:00 p.m. eastern. they sell food and alcohol and as you can see, it's really designed for people to stand up and move around, not to stay seated in their seats. >> it's so interesting, julia,

because another dome that's getting a lot of attention is sphere in las vegas. got an upgrade from jpm, one last week from seaport. what we've seen is so much enthusiasm and excitement building. those tickets are not ever $30, i don't think. but the -- >> yeah, so that's -- >> the immersive experience of it is what is so exciting. you can see that translating. it's interesting to think about whether this -- are they going to get competition from movie theaters who decide reinventing the screen is the way to go if you want to put butts in seats at theaters? >> the main difference between this and the sphere is, yes, it's smaller. the l.e.d. doesn't go all the way around. it's a half sphere. this is for live events. yes, they can show films here but this is more designed for these type of live events. this is not the kind of thing

where the sphere where you need as much room for it. it's a much smaller venue. 1,700 people can fit into this space. many more thousands can fit into the sphere. but i think it's all part of this big drive for more immersive, live experiences. people want to leave the house and they're willing to pay up for it. >> julia, it kind of reminds me of some of the early promises of virtual reality in sports where you would put on goggles and be courtside at the garden. i wonder how you think it collides with or competes with that. >> well, those virtual reality experiences were about watching from home. you could put on your headset and feel like you're courtside at a game. this is about feeling like you're courtside with your friends with the ability to stand up, get a drink, move around, and actually have that experience of physically feeling like you're sharing the experience. with someone, carl. i think they're all sort of leaning into this interest in live sports and the fact those sports rights are only becoming more valuable but just a different way to consume that content. >> awfully interesting, julia.

it is collision between the technology, and as you point out, the interest in live sports. that's julia boorstin in l.a. mike i know you have a big show later tonight, yes? >> 6:00 p.m. we'll do "taking stock," making sense of a week where there was a lot to work with. really trying to assess this rebound, where the risk appetite is going to return. look ahead to jackson hole. you know, obviously kind of what act are we in in the horror movie? midway through or through it? are we done? >> we'll see you tonight at 6:00 with santoli. "money movers" begins after this. (♪♪) car, this isn't the way home. that's right james, it isn't. car, where are we going? we're here. (♪♪) surprise!!! the future isn't scary. not investing in it is. car, were you in on this? nothing gets by you james. nasdaq-100 innovators. one etf.

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for a full line of premium american made products order at wt.com nothing protects like weathertech. good friday morning. welcome to "money movers." i'm carl quintanilla with contessa brewer at post 9 of the new york stock exchange. after a week of inflation data, where is the market headed from here? volatility has been the theme. the nasdaq already seeing a 10% drop and an 11% gain. we're just halfway through august. elsewhere, the s&p trying to make it seven up days in a row. >> then major changes coming for home buyersand sellers tomorrow. we have details this hou