roger ferguson, he's here stamtding by to break down the disconnect between the markets and the fed. >>> also warren buffett's berkshire hathaway making it official, taking full control of the travel operators you're watching "worldwide exchange" right here on cnbc. >>> welcome back to "worldwide exchange." i'm frank holland. as always we take a look at stock futures. more on that in just a moment. first you can see futures in the red. it looks like the dow would open up 150 points lower. take a look at the yield on the 10-year right now,up ping yesterday to its highest level since mid-december, pushing stocks lower, the move coming as another top fed official pushing back on expectations there may be as many as six rate cut this year chris waller says he's confident inflation is on the path of a 2% ta target, but he says there's no need to cut policy waller, the first of roughly half a dozen fed members speaking this week let's talk much more about this with roger ferguson, former fed vice chairman, and contributor of cnbc as well. good morning >> good morning. nice to be with you.

we have roger ferguson with us who was the former vice chairman with the fed.to see you. >> nice to see you, andrew. >> you got a new view with the numbers we have seen so far. is this pushing things out? how will jay powell lower interest rates in your world? >> in my world, it is the second half of the year. for me, that is not a new view. we have seen the economy which is still strong. the last gdp print surprised a bit. the good news is the pce print suggesting the disinflation process is under way. there are concerns that a few people might have with the turmoil in the middle east might lead to pick up slightly in goods inflation. the service sector is still a little hot. the second half is my bet at this stage. i think the market is starting to come in that direction. >> is that a three cut situation or two cut situation or a one cut situation? what are you thinking? >> i'm thinking it may be three. the issue is inflation looks like it is moving in the right direction. they have no need to stay in restrictive territory with the real rate minus inflation.

former fed vice chair roger ferguson will join us. >>> reminder as we head to a brate, get the best offollow us on your favorite podcast app and live anytime. we'll be right back. power e*trade's award-winning trading app makes trading easier. with its customizable options chain, easy-to-use tools and paper trading to help sharpen your skills, you can stay on top of the market from wherever you are. e*trade from morgan stanley power e*trade's easy-to-use tools make complex trading less complicated. custom scans help you find new trading opportunities, while an earnings tool helps you plan your trades and stay on top of the market. e*trade from morgan stanley ameritrade is now part of schwab. 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 crafted just for traders. all so you can trade brilliantly. >>> welcome back to "squawk box." the economy h

. >> michelle, we spoke with roger ferguson, the former vice chair. >> roger. >> yes, i would call him roger. we spoke with him after the jobs report that came out. he said that if the fed were to start cutting rates in the first half of the year, it would require the economy took a significant downturn. it was under serious pressure. is that what you think happens to get the rate cuts in may? >> i should have said not only do we see the dramatic decline in inflation, but we are forecasting a recession. we feel like we will see negative gdp. we think the consumer will continue to come under pressure. it is the combination of inflation being back at or below target and the economy in a mild recession that leads to aggressive rate cuts. >> joanne, the markets traded significantly on the fed cutting sooner. if they do it because recession is taking place, does that still make sense? >> our argument is different. we don't think it is projected for the fed to cut rates any time soon. we think the market is too optimistic. the consumer incomes are rising and spending has been going out of pl

. >> scott, that is not what we've heard from people like roger ferguson, who says, that's not goingtually seeing a weaker economy. >> well, look, if you dig into those numbers last week, there are a lot of reasons to think that the labor market is pretty soft. i mean, 60% of job growth in 2023 was in government and health care. these are acycsacyclical indust. the household survey last month was terrible. that's really volatile. but big declines in employment and labor force preciparticipat. so you take that, those numbers, along with what managers and ceos are saying, you know, the ism services report was also suddenly dour in december. it so does look like there are reasons to think that the mark is a lot cooler than what those top-line figures might say. >> lindsey, why are you so convinced that rates need to come down right now? >> the last mile on inflation is really housing. close to three quarters of the inflation that we're seeing right now is coming out of housing and the last thing you want when you're trying to bring housing down which is ultimately a supply issue is a hi