chamath palihapitiya had calls yesterday, and elon musk tweeted about the stock after the close. what world are we in. and ros brewer is leaving starbucks to run walgreens she'll be the only black woman running a fortune 500 company. it's wednesday, january 27, 2021, and "squawk box" begins right now. good morning, everybody. welcome to "squawk box" here on cnbc i'm becky quick along with joe kernen and andrew ross sorkin. and if you take a look at the u.s. equity futures this morning, we see a little bit of a mixed picture. the nasdaq is indicated higher this morning it's up by about 40 points part of that because of the some of the strength we heard with some of the technology earnings reports that came out last night. microsoft much better than anticipated, amd strong report

there, too, and you can see the nasdaq right now indicated up by about 40 points. dow futures are indicated down by about 140 the s&p looks like it would open down about 13 points this comes after a slightly lower day for the markets yesterday. also worth taking a look at treasury markets this morning, too, if you want to take a look and see what the yield is on the ten-year right now you'll see that at least right now, you're looking at a yield of 1.041%. andrew >> thanks, becky we have some breaking news right now on what has turned into the soap opera, and saga of the markets right now, and that is the story of gamestop. the news to bring you right now is that melvin capitol management, this is the hedge fund that had shorted this company that had effectively been attacked by an army of investors trying to push up and press up the stock of gamestop along the way.

melvin capital is out of the stock. they got out of the stock, from what i understand, yesterday afternoon. i just got off the trelephone with gabriel, who runs the firm. they took a huge loss. i do not have the number of what the loss looked like as was reported yesterday, both s citadel and .72 have infused something on the order of $3 billion into melvin capital to shore up its finances, and gabe telling me just moments ago that the speculation that the firm would file for bankruptcy is false there's some reporting taking place on reddit where so much of this discussion began, and really created the momentum for as i said, an army of investors using options to try to press up that price to some degree, they might be able to argue now that they

succeeded if this was really about vanquishing, if you will, wall street, or vanquishing hedge fund manager in this case, they did take a loss they may not have put them out of business, but boy did they come close we have been following this story, which has been such a wild one gamestop shares right now, i mean, i don't even know what to say, it's up 131%, $342 on any kind of fundamental basis if the stock were worth more than 20 or $30, i think it would be, you know, something to behold. real questions of course about stock manipulation, about the power of what's taking place on places like reddit, really what's motivating this type of trading behavior at you all. it clearly has nothing to do with the fundamentals of game stop, and much more to do with sort of pop psychology of who's going to be left holding the bag. the thing that concerns me most

at this point is whether some of these investors will start to get out today. they'll look at this and say, we won the game, if that's winning. unclear, you know, where the finish line is in that regard, but as much pain as they may have created for melvin capital, for example, my great anxiety at this point is the number of retail investors that have been jumping into this in literally in the last 24 hours who very well may get hurt far more and lose far more than some of the hedge funds that were involved in this. let's just show you where we are right now. joe mentioned at the top of the program, elon musk tweeting yesterday, which also powered the stock even higher. i mean, this is just -- there's nothing normal about what you're seeing when it comes to the stock right now. stock up 51% on friday, 18% on monday, 92% yesterday. as i said, soaring in the

premarket. let's just give you a little bit of a run down to explain what happened shares popping early in the session. this was yesterday when chamath palihapitiya, also somebody who's taken to twitter and whatnot, really trying to push up this stock, and again, it really raises some important questions about what these people are doing, why they're doing it, you know i don't like to think of the market as a game, but that's really what this has become, this stock in particular, a game he tweeted that he bought february $115 calls on gamestop. the night before he tweeted tell me what to buy tomorrow, and if you convince me i'll throw a few hundred ks at it to start. shortly after noon, you had cameron winklevoss tweeting thinking about going long gamestop, and then after the close, elon musk jumping into the action tweeting game stonk, which is a reference to the popular meme and linking to the wall street bets reddit page that's been hiyping all of this

throughout that musk tweet helping drive this premarket move right now. we're going to talk to robert frank who has been reporting on the biggest winners and really frankly we'll see the losers of this gamestop trade. a lot to be concerned about when you think about what's happening here where are the regulators, and is this just the beginning? >> a we'll see situation we all do have a lot to say on this, but you obviously have a lot to say on this it's interesting but obviously they're playing with the calls, and you're seeing calls that are $100 out of the money, and have no value that are going for $19 you've got, you know, market caps going from 2 billion to 25 billion. obviously everything you're saying we understand this is a game, obviously, and these guys, when i put $5 on ncaa game that i don't care that much about, that's the same as chamath putting a couple hundred grand on some calls or elon or any of the guys you're talking

about. i think it's irresponsible, they're laughing about it, laughing all the way to the bank there are market makers, how would you like to be short some of these calls can you imagine being short some of these calls, especially if you're not covered you could lose ten times your money, unlike a regular investment where you only lose 100% i mean, this makes bitcoin look like tea bills, if you think there's speculation in crypto, and now they're looking for the next mark, right they'll find another gamestop, once they're done with gamestop. in the meantime, there's going to be blood all over. >> i understand why elon musk is doing it he hates the shorts. you know, he thinks the shorts are out to destroy this company. he's playing the game too. i don't understand why chamath is doing this. i don't understand why the winklevoss guy is doing this i mean, it's nothing to laugh about, like you said. >> they got too much money >> and if you think people look

unkindly at the wealthy at this point, like wait until you see what happens with the retail investor who gets suck into this and caught in the trap with people who can't afford to lose the money like these guys are doing. >> i'll tell you the thing, there really is a merry band of retail investors out there, both on reddit, but increasingly, and this is what's, i think, even more concerning, i spent a lot of time last night reporting this out, but also spending time in some of these rooms there are places people are going now into encrypted rooms, on to telegram, on to signal, where they effectively are planning their next raid, where they're trying to look to say, okay, where can we, you know, who can we take down next. in this case, it was melvin capital that they were seeking to take down that's why i think the news today that they're out may be potentially a turning point. i don't know i don't know what turns this stock back into some kind of

normal situation but i do wonder what you do about it, and i do wonder when gary gensler, who's been nominated to be in the seat at s.e.c. sits down in that seat for the first time and gets confirmed, what he does about this and what you can do about it given really just how fast technology is working and the ab ability of so many people to get together, and let's call it what is, manipulation, that's what's happening here this is a grand manipulation that we don't normally see in part because people didn't ever get together like this, and for reasons that are different than typical. so i remain baffled. >> if they were doing this and conspireing to do it, you would say this is a cartel they're doing it in open on twitter. another great use of twitter, let's say. >> that's what it is, to some degree you're watching it play out in realtime originally it was clearly a cartel, and the question is

whether we're going to see more and more of this and what, you know, how the government reacts, how investors react, how short sellers, how hedge funds and others react you know, a lot of the short positions, you can look through which companies have a lot of short positions. you can try to figure out who's on the other side, and if somebody decides they're going for it, maybe they are we have seen short squeezes before not like this. >> it might have started with a scintilla of rationality in that game stop, the demise was greatly exaggerated and microsoft games. look at the gaming revenue with people staying at home so, you know, you add that no one's ever going to play a game. we have talked about gamestop being a short, two, three, four, five years ago gaming is back is gamestop the way to play with online gaming, subscriptions and everything else. i don't know but initially, you know, it sort of had that, well, gaming is big during a pandemic, so it starts out with that. now it's just, this is purely,

and it's dangerous i think you're right, andrew it's dangerous, and it doesn't, you know, it doesn't make most people, if they're not stock market aficionados, it doesn't inspire a lot of confidence in what goes on on wall street. we're going to have adena friedman, ceo of the nasdaq, and i don't know what it says about overall fed, you know, priming the pumps. there's a lot of money sloshing around, and these billionaires that are just playing around, laughing while they're doing it, they're closing in on tri trillionaies during a pandemic while everyone else is in food lines. what's equity justice, versus -- what was that yesterday? give me a little primer on that, will you what's the difference between equality, justice, and equity justice? that was biden's thing yesterday, talked on and on. >> oh, oh.

>> with gme yesterday. >> you know, i'm in my own head with this gamestop story. >> you're worried about it i see the concern. you know how you get, you do get anxious. gamestop has got you very anxious this morning, and i don't want you to take it personally >> we're going to show you clips of this in a little bit, but i also had an opportunity to spend yesterday afternoon interviewing the ceo of robinhood who we're looking forward to that, who really has been the founder of the movement of retail investment, not necessarily the founder of this movement in particular in terms of going after these companies, but he has some really interesting things to say about retail investors and whether they should be regulated more or not, or whether we should be worried or not, and he surprised me with his answers. >> did you do any davos stuff yesterday? were you moderating anything while you're doing this too? >> i'm moderating tomorrow as it happens. but i was also doing some other -- i watched a little bit,

and then the larry fink letter there was a lot going on yesterday, so i apologize for missing the -- i had cnbc on all day long, but i didn't -- i wasn't focused on the biden comment. >> oh, yeah, i watched quite a bit of it, actually, and you know, the covid stuff, when i got back i was like driving in a raging monsoon, but at least it wasn't a blizzard it wasn't as bad as it could have been. at least down south it wasn't. >> oh, man craziness. when we come back. yeah it snowed here when we come back, we're going to dig through today's big movers, including earnings from microsoft, starbucks also a new ceo for walgreens as we head to break let's take a look at sq"squawk" planner we're going to be hearing from at&t, boeing, before the opening bell we'll hear from facebook, tesla, and apple.

on the economic agenda we're going to be getting durable goods. those numbers hit at 8:30 a.m. eastern time the fed also finishes a two-day policy meeting and chair jay powell will hold a news conference at 2:00 p.m. eastern time lots to come "squawk box" will be right back. today's big number, $4.1 trillion. that's the total collective wealth of american billionaires according to a report by the institute for policy studies, and americans for tax fairness that's a 37% increase in net worth since the pandemic began in march “could have been me” by the struts hey, mercedes? how can i help you?

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welcome back to "squawk" this morning shares of microsoft are well off the session highs of 2 1/2%. the company reported earnings at 2.03% per share. it beat expectations by $0.39. revenue of $43 billion, beating expectations by $3 billion current quarter guidance came in above wall street estimates. microsoft's azure cloud revenue grew by 50% and out performed in advertising. competitors, alphabet and facebook rising on the news after microsoft's finance chief said the ad business would

continue to improve in the current quarter. so we'll keep our eyes on that becky. andrew, thanks starbucks shares falling let's take a look and see. earnings did beat what the street was expecting but the company's sales recovery in the united states faltered as covid-19 cases increased during the quarter. u.s. same-store sales actually fell by 5% and the company also announced a key personnel move they have been talking a little bit about this and we'll talk more about that coming up in a short time, too in the meantime, though, take a look at shares of walgreens, the company has hired starbucks chief operating officer, roslyn brewer to be its next ceo. when she takes over, she will be the only black woman leading a fortune 500 company. she's been a board member and coo at starbucks since 2017, and she's also on the board of amazon she previously served as ceo of sam's club, which is owned by walmart. she knows her way around, in terms of the retail outlook, and

really understanding consumers, too. joe. thanks, becky. joining us to talk about some of what's happening, managing partner at douglas c lane, and a cnbc contributor there's a couple of stories today. i mean, i would like to just talk about microsoft, and what's happening, and how well the company is doing in the environment it's operating in, but it's just hard to focus when you have something so outrageous, or just so compelling i don't know if it's outrageous. i don't know how to describe gamestop when we talk about it as being manipulated or being gamed, we immediately hear pushback that short sellers need to be taken to task, and this is the way to do it. overall, what are your opinions on what we're seeing with the whole saga of what's happening in some of these names, especially gamestop? >> joe, it's scare as an

investor, and we don't short if we don't want to be in a position, we don't buy it. we go where we think there's opportunity. this is an incredible story, when you look at the amount of information out there, whether it's on reddit or other boards, and you know, you have individual investor, and as you called it, using calls that are very cheap at this point, given where interest rates are, given where anyone can go on robinhood or, you know, go anywhere and buy these things, so you're watching this incredible story play out, where you've got a whole bunch of individual investors, again, some institutional investors. i don't think anyone wins in this this is not good for our system. regulators do have to come in. i'm not sure how that really works. when you look at it as an investment, it gives me pause that we're at some part of the market that could be a catalyst to pull back maybe this is it, but so much capital going after something that doesn't really fundamentally make sense, it's

become a game. it's like las vegas, and you know, those who are playing it, somebody's going to get hurt, and we're going to walk away with the story as you guys have been reporting, and we don't know how it's going to unfold, but it's going to get ugly out there, and as an investor, i would not play in this it will be interesting to learn what's going on. >> the calls compared to the stock price are cheap, but not compared to, you know, inherent value. you've got a stock that's 100 points out of the money, and a strike price 100 points away, you would think as a seller of the calls at $19 that you could make, and suddenly, it blows through that, blows through 100 point, and suddenly you're, you know, you sold some calls. you sold for 19, trading at 60 it's frightening and there's going to be losses, and there's going to be liquidation. >> and it feeds on itself, right? >> i guess >> to your point, if you're watching just the people buying calls, there's somebody on the other side of it >> intermediates.

>> and people shorting it, and they're borrowing these shares, and then all of a sudden you have liquid shares, and you have margin calls, so there will be some effect here, and you know, as you're watching some of the funds come out, it will be interesting for the market because i think this is something that i don't think regulators expected and i don't think, you know, companies expected, so we got to watch this carefully, and like you said, you know, they're going to do it to other companies as well which side do you want to be on? >> andrew, you want in it really is, to musk or chamath, it's like my $5 bet on, you know $100,000 to chamath. >> the thing i was just going to mention -- i don't know if they should be laughing about it either, but it's fascinating that it's playing out as this show is going on, i'm getting notes on twitter and other things from clearly younger i imagine retail investors who are very upset who effectively are

saying you think that this is stock market manipulation, what do you think wall street has been doing all of these years with ipos, dropping them on us and whatnot. i mean, it's an interesting just thought process, and i'll be honest, i'm humbled to be learning about the way people are thinking about it, and i don't disagree that there's all sorts of levels of manipulation, if you will, on the street, and it's something that i think we try to democratize the process to some degree this is at a different level sarat, question i was going to ask is does this change the dynamic, do you think, for institutional investors when they think about making a bet, either frankly long or short or public these bets, depending on how you think or whether you think something like this could happen again >> yeah, i mean, andrew, the unintended consequences of something like this, are pretty huge we want more transparency in the capitol markets.

we absolutely do, and institutions short stocks for various reasons. some of it's just hedging, they might have big exposure in another area they might just have too much of a position in a stock that can't unwind these knock off effects are going to be very interesting i do think we still need full transparency, it's going to be a question of people being much more cautious, really showing their hand for whatever reasons and if it's for speculation or for real investing, so i think this is a story that as it unfolds is going to have a lot of consequences for investing, trading and transparency, and this is where the when the s.e.c. looks at it, kwwe're goi to have to find out what is the right away, and learn from this. a lot of this is new, 10, 15 years ago, you had to wait a couple of weeks to see who was shorting what. today you could find out who's owning what, given these positions. >> the report that we reported

just in the last 15 minutes was posted and is now being taken down you can see it all over. they're taking it off of the site in part because i imagine they're continuing to tryto press the stock. there are others that don't believe the report or believe that the media is somehow doing the bidding of the hedge fund industry just as a point of fact. i spoke to gabe plotkin myself on the phone he said on the record the company had gotten out of the stock. by the way, whether that's true or not, it would be impossible for me at this moment to verify. he did say this on the record, and that's the news that we brought you, but it's just, it's unbelievable just to see how these types of things are now playing themselves out online. >> all right >> these are incredible movements. >> they are. and, i mean, regulation, you know, you wonder why things get regulated when stuff like this

happens. you would like it just -- you would like to have a soft touch on regulation. >> and it's funny, andrew. people are mad that we're pointing this out. it's like their game might get -- this craziness, but really unbelievable okay all right, go ahead, go nuts sarat, microsoft, which actually had a pretty good quarter. we'll do it next time, and the dow is down in spite of microsoft. so i don't know what all of this means for what's happening sarat, we'll see you soon, thanks >> we've got a lot more to talk about. the biggest winners and losers in this wild surge in game stop. robert frank will be back with us right after the break with that story by the way, check out shares of amc. that's another one of the big short squeeze plays that's been taking place you're looking at that stock up.

93%. $9.57, and then later, we'll show you that interview with the coo of robinhood, i mentioned earlier, and what he said about the influx of retail investors into the market. here's a sneak peek as we head to break. >> in idea that all retail investors are unsophisticated, they shouldn't be managing their money, and leave that to the tiperts or institutions is a noon that we just have to move past it's hard to hope, hard to cope with crisis. so we get to work. we mend, fighting for every person in every neighborhood; we, the coming of the common good. so dare to care, to be hope-sided. we're never divided, when we live to give, we always live united.

welcome back to "squawk," it is the stock everyone is talking about. gamestop, and earlier this hour, i reported that melvin capital now telling us that it has closed out its position. it is the latest chapter in what has been a wild ride for this stock. robert frank joins us with another personality that's been

involved in this investor ryan cohen buying shares of gamestop last august it was a risky bet, but given the meteoric rise, the bet paid offhandsomely. robert. >> great reporting by you on gamestop we're going to use the market close to measure this, because who knows where it's going to open gamestop creating $2 billion in wealth for its biggest shareholders just over the past couple of weeks. as you mentioned, the big winner here, ryan cohen, the cofounder of chewy bought around10% of the company last august. he added more to that position last month bringing his total stake to 13% his investment of $76 million now worth 1.3 billion. now, he's also, if you just measure that by day, he's made more than $90 million a day or about $3 million an hour, for the past two weeks now, his other stock investments also doing well.

he put a lot of cash from selling chewy into apple stock that has more than tripled now, the other big winner here, many people haven't seen this or read about it, is donald foss. he is the 76-year-old founder and former ceo of credit acceptance corp. they are the sub prime auto lender foss bought around 5% of the company last february for around 12 million that $12 million stake now worth about a half a billion dollars this is interesting. the hedge fund manager michael bury, that contrarian investor, made famous by the be big short. he owns about $250 million in shares right now he would have made even more but burry actually sold off about 38% of his stake last year, so i'm sure he's sorry he did that now. game stop ceo george sherman, his stake is now worth about 350 million. now, this is the big question, one that becky and joe were also mentioning earlier, so far none

of these guys have sold or at least we haven't seen filings yet. but if you get any of these shareholders whether it's fo is, -- foss, cohen, sherman, selling a lot of stock while the retail investor will get hurt, that's going to cause a whole other debate, guys >> robert, you think the company should try to raise some money right now? that's what i have been doing. i almost think it's negligence not to but then people are going to say they're taking advantage of this crazy moment. >> i don't think anyone would criticize the company for trying to raise money the question is can they do it quick enough with the stock where it is. could you do a secondary close to the valuation, what is the right valuation, could you borrow money would a bank or even an acquisition target, what would they take as currency? what is the value of this company? >> so yes, you would think with these elevated levels, there could be positive business impact

i don't know how anyone, whether it's a lender, a target or a partner, could value the stock as a currency. so i think we'll see where it settles down maybe they could do something to help the wall business, but at this point, it's just hard to value. >> there would be no reason to want to increase the flow if you were the company that defeats the purpose of the short squeeze. things will end lickety-split if they do that >> right >> i don't know if the company is enjoying what's happening either i don't know i'm enjoying what's going on on twitter, sorkin and becky. wow, man i don't know thank you, robert frank. keep it coming it's interesting they're mad because they say we're finally making some money from investing and you guys are mad investing. this is investing. okay coming up dr. scott gottlieb

joins us next to talk about the biden administration's plan to boost the vaccine supply we'll be right back. doing some investing competition beat us, again. how? they have a better finance system than we do. i feel like they might have a better finance system than we do. workday. how do they make better decisions faster?

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welcome back, everybody. the biden administration is planning to increase the covid vaccine supply the united states is going to be buying 200 million more doses from moderna and pfizer, and states will get additional doses

every week there's also positive news about in-person schooling. a cdc paper reports that schools that follow proper precautions have seen very few cases of covid spread among students. joining us to talk about this and more is former fda commissioner dr. scott gottlieb. he serves on the boards of illumina and pfizer, and serves as a cnbc contributor. the news about additional vaccines coming, it's good news, but really not going to get here, most of it, until later this summer? >> that's right. i think if there's going to be a change in terms of the supply over the next two months, it's going to come from johnson & johnson. if johnson & johnson was to get authorized in february, they would have doses available in the lows tens of millions and in march, more tens of millions of doses. that's the near term hope that we could have a big inflection in supply in the first quarter pfizer has committed to 120 million, there's still a lot of supply between now and the end

of march eng t i think there's a possibility if all goes right, we could vaccinate 7,500 people between now and the end of march. >> now and the end of march. that's hopeful, if we can get 75 million people wbetween now and the end of march, i would take that as a good start good news from the schools the cdc says there's been very little spread when schools are taking these precautions there has been very little spread among the students. does that mean we can get schools open more quickly, the ones that haven't opened yet >> i think we can. my district is opening back to file school. they take precautions in the classroom. i think if schools continue to take precautions in the classroom, i think they could be done safely. we have seen that in various states where they have been able to reopen schools safely cases are coming down right now. you look across the country. 45 states have an rt that's below 1. they have shrinking epidemics. hospitalizations are coming

down the picture is improving quite quick quickly. the risks are the variants the case that the south african variant are in low levels, and don't increase their prevalence between now and the summer and getting more people vaccinated probably in florida and san diego, and a sufficient amount that it's going to become epidemic in two parts of the country. could have been around 2%. could be upwards to 4% in the markets. that's the risk. it's not going to create a national epidemic but regionalized outbreaks that could be hard to quell between now and the summer time. >> how would you even know that these new variants are breaking out in your community. by the time you figure it out, is it too late >> i think we're going to know in the next week what the prevalence is of b 117 in florida and san diego. i think we're going to know very soon we're doing enough sequencing right now that we can get an adequate measure of what the percent prevalence is, and so

we're taking a good sample it's harder to detect. with b 117, what we do is look for s gene drop out on pcr testing and when we pull those samples and sequencing them, and i illumina is doing some of this work, when we do the samples and sequence them, a third is this b 117. that's a telltale sign that gives you an indication what samples to pull with sequence. with p 1 there's nothing reliable that's ubiquitous, that we can look at to see what samples might be the new strains. it's a little bit of a needle in a hay stack searching for that we could be missing that it's probably not the case that it's 5% in the community because we are sampling a lot now. i think that we would detect we could be missing low level prevalence of those strains. >> those strains are both more

highly con teenatagious, i wonds there anything we need to be doing differently because of these strains, especially if you're in a community where it's been detected? >> we don't know why they're more contagious. the simple things still work, social distancing, mask wearing. it could be the case that they're more easily aerosolized or people are more transmissible because they have more viral load, in their upper airways masks become probably more important, and wearing a higher quality mask becomes more important. i think the instead of trying to get an n95 mask or wearing two masks a procedure mask under your cloth mask, newscast going to make more sense in the environments where the strains are gaining prevalence is looks like florida and san diego are the two markets we have detected a sufficient level of the new strains, that they could become epidemic in the two regions. it's a race against time, can we get enough people vaccinated with b 117, prior infection does appear to provide immunity

against the strain florida has had a lot of coronavirus. it's probably not going to spread there as aggressively the strain in brazil, it looks like prior infection doesn't really provide sufficient immunity we are seeing people getting reinfected in brazil with that strain >> let's go back to the sp vaccinations, it's great news, we could have 75 million people vaccinated by the end of march if you're looking for any sort of an appointment to get a vaccine, even for people who are 65 and older, it's really difficult. and almost impossible in some situations when do you think we get to the point where if you qualify for the vaccine, okay, you're going to be able to get an appointment, at least get something on the books >> i think the end of march. i mean, if we're successful at hitting that goal, and that's my number that i have sort of backed into looking at the available supply and pace of vaccination. i think it's possible. ifyou're getting to 75 million people vaccinated by the end of march, you have vaccinated all the people over the age of 65

who want a vaccine let's say 40, 45 million of them wanted to get vaccinated, you're vaccinating 25, 30 million people you're working through the intense demand, and you're at a point where you start to have to open up to general availability. that doesn't mean everyone is going to get vaccinated on april 1st or 2nd it does mean they are going ton line and getting an appointment over the next four to six weeks to get vaccinated. we're going to be at a point where supplies surge hopefully j&j is in the market, st starting to put more vaccine in the market 75 million people of the intense demand has been vaccinated if you want to vaccinate more people beyond that, you're going to have to give it away to healthy 30, 40 and 50-year-olds, i think it could become generally available sooner than we think, maybe by april, when and j comes into the market. >> we're seeing the defense production act get picked up by the administration in certain cases for things like creation of n95 masks and other areas

if you're looking around at the supply chain, where do you think the biggest problems still exist, whether it be for ppe or whether it be for the things needed for vaccines or even the needles to get the vaccines into people's arms? >> yeah, there's some components that are starting materials for the vaccines, both machines as well as inputs that we could still be investing more in frankly, we could have invested more in them 12 months ago, we would be in a different situation now. it's never too late. i would be looking at the starting inputs to the biologics manufacturing. the vaccines and monoclonal antibodies if you start investing in a facility right now, it's possible that you can convert an existing facility at about six months and maybe build a new facility in 12 months. we're going to need that domestic manufacturing capacity. this isn't going away, if new variants emerge, we're going to need that as a backstop. if we have to give new boosters and monoclonal antibodies, as a backstop against the variant

i would be making investments, 12 months, 16 months, what could we have online the biden administration didn't sign that contract on the additional doses of vaccines, as an insurance policy. j and j comes into the market. we're going to have ample vacc vaccine. hopefully we'll be in a position to give it away to other countries. those are the investments you need to make you don't know what's going to happen we should be doing that right now. looking for those opportunities. >> i hope somebody in washington is listening scott, thanks for your time. it's good to see you. >> thanks a lot. at&t just reporting the company beat consensus by $0.02. adjusted quarterly earnings of $0.75. revenue was above wall street forecast unlike rival verizon, at&t added a larger than expected number of paying phone subscribers, 800,000 compared to a forecast of just over 475,000 postpaid phone editions got a

boost from 5g. still got to look at the dividend here in terms of what the yield is, almost 7%. in fact, stocks down today, as you can see, it probably is yielding 7 based on a $28 handle and the company goes on to say that the 2021 total dividend payout ratio will be in the high 50% range. and then, you know, you also look at hbo max, and activations doubl doubled since the end of third quarter. a multifaceted company with a lot of moving parts to decide whether the numbers are good or not. at this point, down 2 1/2% andrew. >> here we are talking about numbers and fundamentals, where are the game stop investors to push up the stock of at&t. >> easy. it's andrew r. sorkin. dude, just leave me out of this.

i like gaming. talk to him. talk to him. i turned off twitter >> okay. a lot more to come we're going to talk about retail investing. it's the hot topic of the past couple of weeks, and we've got some of the best guests to talk us through it. robinhood ceo is going to join us and we have nasdaq ceo adena friedman who's going to be our very special guest tath of them on the state of reil investors and what this saga means when "squawk" returns.

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we've been following gamestop all morning, as you know, the stock pairings and the gains after reporting that

melvin capital now telling us it's closed out its short position this just the latest example of retail participation in the markets reaching new height and euphoria in some cases, the ceo for robinhood, vlad tenev. safering becoming an investor is the new home dream like home owening. he writes for people in my native bulgaria, two options, keeping business in the state bank and stashing it under the mattress and the conversation i had with him yesterday, i started out by asking him how his upbringing affected him and his decision to create this company. >> after the fall of the berlin wall and communism, there was a period of economic stability leading up to hyperinflation in the mid-'90s so, you know, i saw my relatives' pensions get

decimated. and, you know, part of what is so powerful about the financial system is had people been given the ability to invest -- invest in a wide variety of assets, then there are options that are reasonable and so, i really -- i think i really came to value how powerful the american financial system is and has been, as a wealth creation tool and that really motivated our mission, which to give everyone access to the financial system and make it available to as many people as possible >> and we've talked a lot about your efforts to democratize investing for an entire generation, really, for the first time but i want to ask you in particular about this quote in the op-ed. you say, those who question the capability of retail investors

do not have the interests of everyday americans at heart. you write, it's wrong, it's wrong to aview the arrival of increasing numbers of retail investors in the market with dismay there say considerable amount of dismay at this moment, within the marketplace, if you will in part about this younger generation of investors and whether they have the wherewithal and the knowledge to properly be investing. what do you say to that? >> well, i would say two things, first of all, of course, we believe in education and that people should be informed. and in fact, we've made lots of progress and very significant updates just last week we announced a revamped robinhood learning portal which aims to take people from being first-time investors and teaching them basic concepts, all the way through to more advanced concepts around investing. so, obviously, i think education

is going to be something is that we're going to continue to invest in. and tools to make sure we really enable first-time investors to become long-term investors but the other thing i would mention is that i have an opportunity to talk to robinhood customers. and one of the things i enjoy doing is sitting in on customer research, which is a big part of our product development. and there's a lot of times where we hear this feedback that robinhood is one of the first products and companies that treats people like they're adults and meets them where they are. so many times, you hear, and we've heard our customers saying that, you know, other financial institutions or advisers are trying to sell me products trying to tell me that i shouldn't be investing my own money. and that i should leave that to the experts. and robinhood is the first company that's actually treating me like an adult and giving me and meeting me

where i'm at in my investing journey. and giving me the tools to empower myself and to manage my finances so, we hear that a lot and i think that resonates with us and the mission very strongly of course, we need education, but i think this idea that all retail investors are insophisticated. they shouldn't be managing their money and they should leave that to the experts or institutions is a notion that we just have to move past. >> we're going to have a lot more of that interview in just a little bit including his comments about gamestop. you can read robinhood's ceo's full op-ed there in the next interview as i mentioned in the next hour. much more on the gamestop news that we broke earlier today. melvin capital telling cnbc that it has closed out its position that stock was above $330 before we broke that news

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♪ good morning, welcome back to "squawk box" right here on cnbc i'm and drew ross sorkin along with becky quick and joe kernen taking a look at u.s. equity futures at this hour we are in the red. the dow stands up 220 points s&p 500 off about 30 points, the nasdaq off 13 points we've got breaking news from regeneron to bring you now i'm going to meg tirrell who has that news. meg. >> hey, andy, we have regeneron with how well the antibody cocktail works against the new

variants, b 150 and b 171. this is on a preprint server not peer reviewed from columbia dr. david ho and what they found is that the cocktail retains its potency against the variants but for the uk, both antibodies appear to work with the same potency one of the antibody drugs included in that two-drug cocktail does have the potency retained it appears still to work guys, this was regeneron's plan the entire time with the cocktail they do say, though, they have hundreds of additional potent neutralizing antibodies in their labs that they could form new ones with, if needed this works with the vaccines and gives a look how well it works against the variants against the uk one, it looked like a two-fold decline in k

neutral ability. and 8- for moderna, 6.5 fold for pfizer not clear what the efficacy will be and they're working on booster shots and the new vaccine targeted towards that b.1.variant. and david ho saying if more mutations accumulate then they may be condemned to chasing after the sars 2 and saying such considerations require that we stop virus transmission as quickly as feasible by redoubling on measures this is a respective lab, but concerning, but not knowing exactly what the impacts are going to be on the variant of the vaccines back to you. >> meg tirrell, as always, thank you for bringing us that news.

becky. >> thanks, andrew. we have a couple of earnings out yesterday after the bell we should tell you about, microsoft earning $2.03 a share. that beat the consensus by a long shot. the revenue came in better than expected it was microsoft's cloud commuting that came in 50% from a year earlier check that out, that stock up better than 2.4% a big mover there, microsoft and micro advisers beating with the chip machipmaker's revenue g in above conthen suss. amd on gaming consols and personal computers and data centers. that stock down by 1.25%

andrew >> thanks, becky breaking news this morning on the gamestop story we've been reporting all morning, having talked to gabe plotkin who runs melvin capital gabe plotkin saying that melvin capital has been out, closed out its position in the stock. of course, that company was firm, i should say, was short. looks like it's lost a ton of money, was short that company, up through before the end of the close yesterday. but gabe saying that they got out yesterday afternoon. of course, the question is what happens now. gamestop shares. melvin capital had to take in an additional close to $3 billion in new capital citadel coming to the rescue along with point72 in their case but as we've been talking about all morning, this is a remarkable saga with gamestop. so many of these investors no longer really investing on the fundamentals are what's

happening at gamestop. but more, just continuing, trying to push up the stock. and we've seen so many folks like elon musk take to twitter about it and fanning the flames, there's a lauot of flame fanning taking place right now. big questions about regulators, where they are, what they should be doing a lot of criticism online. critique online. they say if this is manipulation what do you think wall street is doing to us, retail investors? there's a pop psychology dynamic at play. i think we're all learning, trying to understand what it means. but also what it means in the future for the ability of retail investors to get together on places like reddit and other places to form an army of sorts and try to push up the stocks in certain cases like this. so, i'm at a loss for words, joe. i really am. >> andrew, i think it's -- you

know, i don't know what finally causes people to pull in their speculative juices but, you know, dow's not acting that great it's not a lot, down a couple hundred points but i don't know what to the attribute it to other than -- seriously, when you see something like that, that is really -- i said earlier, bitcoin looks like a t-bill -- or crypto looks like a t-bill in the gaming with the call options and the shorts and everything else so, actually, if there is a risk off there is bitcoin down $1300, we're not far the breaking under $30,000. sooner or later some of this froth seems like maybe it starts to come out of the market. this may not be it may never ring a bell, but that got crazy overnight. bitcoin going to -- what's the highest -- what's that, becky?

>> look, i think the concerning thing is you want new retail investors to come in you want people to understand that investing is how you really make the most of your money. it beats over the long term just about anything else you can do but when you have new retail investors who are in, only seen stocks go up and not seen them come down in pretty spectacular falls, that's the concerning thing. this is not a long gain. it's not something you can game out the timing on a day-by-day basis. and that's the concern >> a lot of schadenfreude with some of the shorts i'm trying to find a new way to switch instead of saying anyway -- they told me -- hey, did you hear this -- the jay leno thing -- hey, reportedly, after the result -- >> in other news -- >> in other news -- that's not a

good jay leno. there's other things happening, phil lebeau is watching phil lebeau, and tesla which reports tonight. we're beginning with josh lipton who has a preview of tonight's big report from apple. apple, i understand, microsoft, i understand the fundamentals, some of this other stuff i'm not sure i understand, josh we're looking forward to apple >> let's head into this, we know this, apple enjoying a very nice run. it has outperformed all four of the big tech peers over the last four years it's down a whopping ping 170% the recent lows last year. bulls see more coming with the reception of the 5g enabled 12 phone. with checks for higher margin

pro and pro-max projects and with the lockdowns people continue to work from home and learns from home for the ipad and mac businesses. the preliminary pc shipment data showed apple shipping 6.3 million macs in a quarter. after services, morgan stanley seeing a second consecutive quarter of growth spurred by continuing seing strength in th store. on the other hand, some skeptics asking about what about after this quarter they know there are potential challenges, for example, tougher mac and ipad compares on the way. let's get to phil lebeau watching tesla and boeing. >> hey, josh as you take a look at shares for boeing kind of interesting there's been a bit of a split with shares what boeing have done in the last month, compared to the s&p 500 really haven'tgone anywhere.

in fact, pulled back a little bit. q4 numbers, loss expected, a loss of some $1.80 a share we'll find out the exact numbers in 20 minutes. a couple of things we're focusing on with boeing. one, how many progress are they making in repairing the balance sheet? also, the 737 max, what's the outlook there? by the way, the max was approved by the european aviation regulator this morning it's good to go in europe. that's a huge win for the max program. and the question is business in china. they haven't had an order from china for commercial aircraft since 2018 as for tesla, they report after the bell and the focus here is going to be what is going to be happening with the gross margins at tesla. as you take a look at shares of tesla. unlike boeing, tesla continues to be off to the races 52-week high, all-time high of $880 that was yesterday and, guys, it all comes down to the delivery guidance for tesla. they give this -- after they

report their q4 numbers, remember, they essentially hit their guidance last year of delivering 500,000 vehicles. the estimate on the street is for their guidance to come in at 796,000 vehicles delivered this year don't forget, guys, coming up "squawk on the street," 9:00 a.m., you do not want to miss this exclusive interview, dave calhoun, ceo of boeing, talking about the outcome in 20 minutes and outcome for boeing guys, back to you. >> thank you when we come back, we will return with nasdaq ceo adena friedman she's going to talk to us about the remarkable short squeeze action in the market the surge in spacs and quarterly results for the nasdaq before we head to the break, let's get a check on markets you're going to see red arrows the nasdaq has come down nasdaq off by 16 points.

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rise this year, we've seen an interest until trading apps like robinhood and the efforts on the market here to discuss more adena friedman, nasdaq president and ceo. nasdaq numbers have been good this year, adena, whether staying home or being a beneficiary of rising interest in retail. nongap 1-60. revenue beat estimates $788 million by $36 million we're going to go over some of this stuff because you'll see where i'm going with this. nasdaq, if someone wants to speculate, or dare i say, what's next, investing or speculating, there's something el after speculating, i'm not sure what it is. gambling but you will accommodate people. and you will accommodate speculation. i'm pointing to an option increase, 71% increase in option activity in the fourth quarter >> well, first of all, thanks,

joe, great to be here. yes, we are pleased throughout the year actually we performed well we had a 15% revenue growth for the entire year with $2.9 billion in revenue in th forth quarter, we did revenue by 52%. when we look at the sources of growth from nasdaq, it actually comes from all parts of our business we had certainly the growth, trading activity that you just mentioned, as well as a very large growth in issuers becoming public 316 companies tap the public markets last year a ten-year high for us. then we also had growth in our indexes. the nasdaq indexes, 81 grew 51% for the year that really is a reflection of the fact that our indexes tend to focus on the next generation of the economy and where the economy's going. i think, lastly, our technology business is, the revenue we got from the software and services

businesses grew 11% for the year so all of the portions of our business that really serve the capital markets and our client has a very strong year in 2020 you mentioned the trading activity and we did have a record year in trading. certainly an option slash, joe >> and i like what you're doing, you have expanded and diversified. big number increases in solution segments, investment intelligence, platforms, 27% increase, 12% increase but you are benefitting from the interest, the retail interest, in investing and where i'm going with this is gamestop, some of the other things that we're seeing and different areas of market, whether it's ipo speculation, as well as some of these new issues that have doubled or tripled right after coming public. you were there to benefit from that but is it healthy, adena, what's your feeling on what we're seeing right now

>> well, we're definitely seeing a significant increase in retail markets throughout the year both in equities and options. i think when we look at the role of the exchanges, our role is to match the buyers and sellers and provide an accurate supply in demand in a stock or option in the any given period when we look at our larger role as a self-regulatory organization, we focus on making sure the activity in the market is legitimate activity and if there is any sort of manipulation going on that we root it out and we eliminate it from the market. so that is also part of our role i mean, when it comes to some of the latest activities that we've seen, i'm not going to comment on any particular listings, particularly those that are not listed on the exchange i think in general, when we evaluate how we would manage through a situation where you see a significant runup in a stock, that's not based on news. it's not based on fundamentals what we do, we do have technology that evaluates social media chatter.

and if we see a significant rise in the chatter on social media channels and then we also match that up against unusual trading activity, we will potentially halt that stock to allow ourselves to investigation the situation. fob able to engage with the company and to give investors a chance to recalibrate their positions. and then if we do think or contemplate that there may be some manipulation, weicinra. >> you mentioned social media, you've got gamestop, it may not be listed, but you have someone on reddit on this popular site, saying i'm not selling until it gets at least to 1,000, 1,000 plus so, we know what the underlying business of gamestop is. how would you describe that? what would you suggest would be an action that someone, a

regulator, that might think that this has gotten out of hand? what would you do. >> what would you suggest happens here >> well, i think first i would give advice to investors if you think it's too good to be true, it likely is so, i think that also focusing on fundamentals and at least understanding the underpinnings of a company's performance making an investment decision, these are elements that an investor should be have considering making their decisions in the markets but at the same time, you are correct that rectors have to consider the latest technology that's being used to spread information about companies. there is something called a pump and dump scheme that has been say level -- say type of manipulation that's occurred in the markets for a long time. but the fact is that's a key element of manipulation that we try to root out. and then we do collaborate with f

finra and the ftc to the dump themes or whether regulators have to catch up with the technology that's now available so those are the types of things that i think we'll all be evaluating as we go forward. but recognizing that it is important for investors to educate themselves and make sure they understand the nature of the markets and focus in on the stocks that they're choosing to invest in. >> given the action that we're seeing, what we just described, given what we've seen with the environment for ipos, you can go into what's the next quarter look like for ipos, but is the amount of ebowlence being that jp. >> we have to look at activity in the stock market in particular there are a few things underpinning it. first, of course, the monetary policy that's making money very expensive for companies to raise

capital. but also making other investment choices, really, the returns on those other investment choices not nearly as attractive therefore, there is a lot of money coming into the system and the fiscal stimulus is putting more money out in the system that's making it so people have dollars to put into the market then the third thing, in fact, there are a lot of companies that have done well despite the very challenging situation that we're in and those companies have gotten a disproportionate amount of the capital and investment dollars that also means most of those companies, many of them are leaning into the future of the economy. so investors look out into the future and say what are the potential of opportunities that these companies have and they tend to be quite vast so, i think all of those things are driving to valuations that reflect the future of the business and are certainly making it also reflective of the fact there are not a lot of other investment opportunities out there that can give you these potential

returns. so, i think that's a lot of what's underpinning the stock market today >> hey, adena, comment ton this. this gamestop situation to some degree reflects an idea that the public doesn't trust the marketplace. and doesn't trust, frankly, the professional investor marketplace. i'm going to read you something. i've been commenting on gamestop all morning. there's a tweet going around by somebody who wrote, i don't like the language you're using to describe what's happening here if underwriters of an ipo pump up the i will po price so high once it opens retail investors can grab it just as it drops as a stone, that's okay but if millions of retail investors do it, it's wood bad in many respects there's a lot of commentary that retail investors are doing what they think that hedge fund and professional investors have been doing to them for years. what do you think, as somebody

who runs a marketplace, should think about that in the larcher context? >> well, certainly, i think as we look at our responsibility as a stock exchange, as the regulators ask their responsibility in providing investment protection, i think the most important thing we try to provide is a fair and balanced market. and in terms of -- and that portends to the activities of both professionals and retail investors. i think we have to look at responsibilities that everyone has to make sure that we are providing proper transparency. that both retail and professional investors get access to information as fast as possible and that the mechanics of the markets allow for an equal participation in the market. i would say in many, many of those elements we actually are at a great place retail as instantaneous access to the markets they have instantaneous action to information and we have done a lot with the industry to educate retail investors to make sure they understand the benefits and risks of the markets they now have a level playing

field where they can participate. i think that we hold professional investors and professional retailers accountable for their actions as much as anyone could be accountable. that is our job and i think we do it quite well >> you know, we've mentioned social media i couldn't help but -- it's not obviously similar to some of this controversy surrounding facebook and twitter and everything else. but once again, what's one of the things we're talking about -- maybe misinformation, and pump and dumps and it's occurring on social media again. i'm wondering whether it's part of the same problem, the type of regulation that we finally need to consider. and like i said, we should always have a light touch with regulation but you're seeing the way things can get started, again, this is different, maybe it's reddit, maybe it's not facebook. but we're seeing the same situation, at this point, it's

not about an election. it's not about an insurrection, but there are interesting things happening that people to be spawned to some extent or at least blown out of proportion by social media again, adena. >> well, i do think, though, as we look at the new technologies that are there available to everyone, including investors, i think it's also important for regulators to understand that manipulation is manipulation, whether it's happening through a new technology medium. or it's happening through traditional mail so, i mean, it's just a matter of making sure that we understand what the behavior is, what's underpinning the behavior and working appropriately with the very layers to manage the situation. regardless of the technology that they're using >> adena friedman, thank you and sorry, normally, we just talk about your results and, obviously, you're probably proud. and we could have talked about that for seven or eight minutes but this is interesting, what's happening. i think it has broader implications for what's going to happen in the markets.

>> yeah. and i would say we're extremely proud of the team and the work that we've done to provide our services to our clients. and thank you very much for having me on today, joe. thank you. >> you're very well. andrew >> great to see adena and great conversation >> meantime, we return, dow component boeing ready to report the numbers in the market, reaction, straight ahead, we bring it to you when we return after this time now for today's aflac trivia question. when did apple hit a market cap of $2 trillion the answ, enbssqwkerwh c "ua box" continues coach saban... i crutched out to the mailbox and there it was - a medical bill for twelve-hundred dollars. i had no idea i'd have to pay that. that's right. it's hard to know exactly what your health insurance is going to cover, so you gotta protect your blind side. aflac! aflac pays you money directly to help with expenses health insurance doesn't cover. really?

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♪ now, the answer to today's aflac trivia question. when did apple hit a market. cap of $2 trillion the answer -- august 19th, 2020. it's currently the most valuable company in the world, passing saudi aramco on july 31st, 2020. we've got some breaking news to bring you right now, boeing earnings just crossing the wires. we want to get straight to phil

lebeau who's got the numbers and market reaction. >> andrew, the immediate reaction may about a knee-jerk reaction lower as people say wait a second, they had a lost of $15.20 a share for the fourth quarter. the estimate was $1.80 a share we'll explain some reasons why people have to say, hold on say a second to get a better understanding. the estimate was over $15 billion. one huge reason why the number -- the loss is so much great than the estimate. $8.3 billion in charges that the company will be taking in the fourth quarter the largest of those charges, $6.5 billion, that's for the 777x the next wide body plane that's scheduled to go into deliveries and go into services. it was expected to be in 2022. because the market worldwide for wide bodies has softened, they're pushing that out to

2023 as a result, they're going to be taking a charge of $6.5 billion. we're not going to go down all the other charges, four other ones the total coming up to $8.3 billion. a couple of the key financial metrics we want to give you, operating cash flow, negative $3 billion. a little better than what analysts were expects. free cash flow, negative $4.3 billion. that is slightly better than negative $5.1 billion in the thirds quarter, the cash balance stands at 25.6 billion the debt balance, 63.6 billion both of those roughly in line where the company was at the end of the third quarter again, the big news being that boeing is pushing out the first delivery, the entry into service for the 777x that was scheduled to be for 2022 now happening in 2023. again, this is because the wide body market which is what you fly internationally, 99% of the time, that market has just

cratered and the demand is simply not there. guys we're talking with dave calhoun, ceo of boeing you do not want to miss this interview. it's a cnbc exclusive coming up today on "squawk on the street" at 9:00 a.m. we'll talk about the q4 numbers as well as the charges, and outlook for the 737 max which, by the way, andrew, was approved by european authorities to return to service in europe. a huge deal for that plane >> phil lebeau, as always, breaking down the numbers for us we appreciate it very much we'll see you and looking forward to watching that interview in just a little bit when we retu, 'rrnwee going to talk big tech and preview apple's results, after this.

♪ well, you just heard from boeing's results we go from up in the sky to up in the cloud. microsoft delivering blowout numbers last night saying its cloud segment azure awe revenue growth of 50%. meantime the only other company with market cap is apple, reporting first quarter results. joining us now is gene munster from luke ventures where he's the founder and managing partner. and keith weis, an analyst at morgan stanley gentlemen, welcome to both of

you. let's start with microsoft numbers last night keith, let's start with you. you raised your price target up from $260. you already had it as a top pick what do you think is happening here why did you raise your price target >> thank you for having me the bottom line, the investments microsoft making in their business around cloud, around collaboration, security and data, they're really now starting to pay off. that plus a better spending environment. enterprises are getting back to business s&ps are recovering. leading to top revenue growth to talk about the acceleration in azure. and the company continues to operate well so operating markets are heading in the right direction. the bottom line line, the earnings, number, eps rose by 10%. that brought up the forecast and we've seen plenty of basis for the stock. >> how far is that from here, i mean, just in terms of your time line for that? because that is a big jump to go from the 232 it's trading at to

285? >> sure, it's a 20% upsides, a one-year appprice target microsoft has for server and tools, office 365 for the next two quarters and we see further room for acceleration and those business lines plus, further room for market expansion as we get past the tough spots like console cycle. great for revenue growth but while you're going through it depresses margins. so we see even more quarters coming from microsoft and their fiscal q3 and q2 that's the march and june quarters as we see the better quarters the stock will continue to drive higher we think the multiple has room for expansion back to levels we saw last year. right now, training 26 times earnings, we could go up to 31, 32 time earnings as people continue to see the good quarters coming out of microsoft. >> gene, let's talk about apple

and what you're anticipating tonight. there are high expectations for tonight. you think apple is going to beat the high expectations. why do you think that? >> correct, becky i think there's 3% upside to the numbers. i think that's partially driven by the mac that is on fire right now. 40% plus growth on are the streets and a low 30%. that's because of this accelerating digital transformation there's one thing i really want to impress on apple, holders or potential holders is the theme of accelerating digital transformation, that means work an learn from anywhere but also the use of tech is through the lens of apple and apple is benefitting from that through a hardware refresh and this powers the upside i think the irony of all of this, apple has long been discounted, multiple based on hardware business. we're seeing importance of that. we're going to see it in some of the numbers tonight. i do want to give people a heads-up too there is some noise in the

numbers with some of the shifting of the iphone timing from q3 to q4.but when you put all of this together, i feel very confident we think this is a $200 stock in the next couple of years and continue to be optimistic about their poll position. >> hey, gene, just in terms of this refresh going on, everybody getting a new phone, getting a new laptop because they need to right now, they're home for the pandemic how much of that pulled forward from sales down road or how much do people to continue to do this this i wonder if there's a limit you hit where everybody's got a new phone or laptop? >> well, i think there is some form of a limit. i think we're still probably four to eight quarters away from eing at least on the mac and ipad business. and people don't just go -- an average mac is $1100 an average ipad is $550. they just don't go out and run and spend that it takes time for them to get to

that decision. i think they're hitting these pain points progressively. i want to put it numerically, the street is looking for 15% revenue growth this year they're looking -- or 2022 this is really where i think the center of apple stock is going to be, expectations about next year, i think that number is going to be closer to $10. i don't think that poll forward is expansive enough to have a negative impact. in other words, i think the substantial acceleration will continue to have a benefit next year >> guys, you both put so much time and effort trying to look at the fundamentals of the company, trying to figure out exactly where the price is going to go based on the fundamentals of the company you look at the price earnings ratio, whether you'll be able to get anything like this i just wonder when you look at things like gamestop and those things that clearly aren't trading on fundamentals anymore.

what do you think of it, gene? >> yeah, the conversation is partially about stock. partially about fair value i think there's -- about how professional investors and more day traders kind of co-exist i think there's so many layers to it. that's the first thing that comes to my mind this is not clear. this is different than anything i've vectored into even my experience in covering tesla seems to pale in what is going on with gamestop and so, the simple answer is, fundamental question, fundamental truth is what the value of gamestop? that's the piece i don't have a good answer for you today. we're going to get an answer on that and that is where our anchor is, i think investors, let's get out of this emotion and just figure out where fair value is >> good luck with that gentlemen, thank you both for being here today we appreciate your time. >> thanks for having us. >> thank you coming up the gamestop short squeeze and the retail

investors, ceo and co-founder robinhood. more of andrew's interview hey, guys, andrew, the common theme i'm seeing is that hedge funds have been taking it to the small guy for years and years and years. >> yep >> and it doesn't matter how we do it, gamestop is just the vehicle to get some of ours. >> right >> from these guys >> this is payback >> payback and isn't robinhood the perfect name for the taking from the rich and giving to the -- >> yeah. >> but there are people writing in saying literally thousands of people's lives have been changed by what's happened with gme. i think that's extracting ill-gotten games from the fat cats but the point is well taken. >> right >> this is a bad commentary on what people think. and we've seen recent polls. >> well, that was what we were talking to adena about, sort of the larger issue, there's a part of the public that doesn't think

this system is fair and take advantage of it now. there are people who made an enormous amount of money over the past couple of days. >> right >> and some are essentially saying -- >> but they think it's coming from some of the hedge fund guys and the billionaires >> right >> have you gotten any okay, boomer tweets or is that just me >> yes, i'm getting the okay, boomer i you're a boomer >> just want to say -- >> we've gotta go. >> okay, boomer. competition beat us, again. how? they have a better finance system than we do. i feel like they might have a better finance system than we do.

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welcome back to "squawk box," everybody. we have a lot of earnings have been out today we have shares of at&t adjusted quarterly earnings of 75 cents a share revenue beat and off by 2.5% just a few minutes ago we heard from boeing, reporting, reporting a variety of onetime charges including the 737 max and delay in the 777x program. that stock is down by 2% this morning, too venight after the bell, instors are hearing from facebook, tesla and apple. lots more to come this morning

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welcome back to "squawk box" this morning retail investor participation in the markets reaching new heights and euphoria in some cases. ceo of robinhood vlad tenev is writing an op-ed, i asked vlad about gamestop, of course, we've all been talking about, a stock on a rocket ship as part of this short squeeze.

whether those that are investing in this fully understand what they're investing in >> without commenting on individual stocks and whether people should or should not be investing in them, what i'll say is that, you know, like many others in the industry, we have processes that respond to increases in volatility in certain names, by doing things like raising the margin requirements so, you know, we've done that in lots of cases. and, you know, we were -- we always remain focused on making sure the system is reliable, that we're investing in stability, making sure we're up for customers when they need us the most and that we're investing in customer support so, those remain our two priorities and other than that, you know, as you've seen with this market, there's things happening, different things happening,

every week and i think we have to avoid, you know, running our business as if we're responding to, you know, what's in the news on a weekly basis and focus on the inputs of making sure that we're a reliable service, that we're investing in stability and that we're investing in support. and educating our customers and providing them the tools that they need to make informed trading decisions. >> just so the public understanding, in the case of something like a gamestop, are you raising marginal climates. do you look at a situation specifically like that and say, you know what, this is complicated? and not only is it complicated, we're not sure our own customers fully understand the risk involved here? >> like any investor, we monitor volatility and we take the steps necessary like raising the margin requirements.

i do think it's wrong to assume, though, that most of our activity is characterized by trading of volume time stocks. as i said before, most of our customers are, you know, what's called buy and hold. they deposit it and buy over the long term. you have seen overall growth in the sector which means all types of customers from the more active investors as well as the most passive have been growing through 2020 and, you know, obviously, the pass iive ones don't get as much attention out in the public. but i do think if you look at the products we're rolling out fractional shares drip recurring through 2020, these are all intended to help first-time investors. and also help them on their journey of becoming long-term investors. >> and as our viewers know so very well, we've been talking on this program so much about the spac frenzy. i decided to ask vlad about

spacs in particular and whether people understand the various incentives and i would argue misalignments that exist in that type of structure. >> retail investors as a category is a very broad category it obviously encompasses a wide range of different people, various sort of strategies and sophistications. and without a doubt, we're seeing investing become more relevant for everyday people and we're seeing retail investors become a larger and more significant force in the markets. so that's -- and we think categorically, that's a good thing. the u.s. stock market has been one of the biggest engines of wealth creation in history we're facing real problems in society with wealth inequality a big part of that has been the wealthy institutions that had access to the stock market and others have not. so, i think most people would

agree that having people investing earlier. and investing frequently and making it habitual is a positive thing. and that's something that we like >> i'll tell you -- vlad, i'll tell you the thing that concerns me, the thing that concerns me is there will be a day when the market will go down. and then there will be finger pointing and the question is, are the investors going to stand up and say, we were so smart, we know everything and we just made a terrible mistake that's not usually what happens. in truth what happens they say, either the big bad wall street -- or the big bad somebody did something to me this was a predatory act and when you look at spacs, for example of so many of the companies going public, there's a reason they're selling into this market and not remaining private. you either have to believe that some of the smartest private investors in the world have been terribly undervaluing their own

companies or the retail investors are smarter than them. who do you think is smarter? >> throughout history, there's been always, regardless of the market conditions, people saying that markets are overvalued. people are saying that markets are undervalued. and that is sort of the ebb and flow of things and things also that changed very rapidly throughout 2020 i mean, who would have thought, in march of 2020 that we would see v-shaped recoveries like ended up happening some people certainly were hypothesizing that at the time but there are others who were saying that's ridiculous and that's wishful thinking. and i think that continues to this day there's people with lots of opinions out there and that's why we have to focus on the influx of the business that we can control. including the reliability of the service. the customer support and making sure that we're improving that

and staying close to our customers and making sure that we help them on their journey and offer them more and more products that help them on their journey, ranging from, you know, our spending and savings products all the way through the variety of investing products that we have >> and you can read vlad's full op-ed on cnbc.com right now. and it is fascinating. we're going to show you more of that interview in the next hour. including how the robinhood ceo thinks about the volume of participation in the markets in a post-vaccine world. given that there's a view that a lot of retailers have jumped in because they've got some money to spend and they're stuck at home. what happens, hopefully, when the world goes back to normal. joe. >> you watching amc entertainment at all today, andrew >> it's -- it's in the same category i mean it's -- it's unbelievable what's happening here. >> yolo, baby, yolo.

that's what they say >> right >> you only live once. we'll be right bk.ac

good morning, futures pointing to a pretty big loss as we make our way towards the open on wall street a down day today, we're getting the dow the worst streak in nearly a year. and we enter the heart of earnings season with numbers just out the likes of boeing and at&t we're also talk with blackstone, its results coming out we'll talk to the company's president john gray. and wall street versus wall streetbets we'll take you inside the online community that has to be mentioned when you're talking about the massive volatility and shares of gamestop and swinging wildly again in the premarket. and we have some breaking news on that front as well. the final hour of "squawk box" begins right now ♪

good morning, and welcome back to "squawk box" here on cnbc i'm joe kernen along with becky quick and andrew ross sorkin and the equity futures, they're down they're down 350 points. microsoft, some of the more results are not different than what we've been seeing that got us through a series of new highs. when air comes out of some speculative areas, i guess you question everything, when and how much is fed-related when there's this much. and i think today the poster child for that would be gamestop but you could relate to blackberry on amc. there's a whole list there's a whole list i guess you just wonder how much speculation or how much froth is really around when you're in an environment like this. and i think that sort of makes the overall markets feel a little bit -- get a little bit of indigestion, maybe.

nothing significant at this point. i don't know if it helps to be in a tax-raising, regulation-raising, keystone pipeline cancelling environment either we'll see. treasury yields at this point are indicated that about 1.01, g get ready for the 0.9 handle again. maybe some of the biggest companies on wall street, meanwhile have been reporting and continue to report including apple which we'll get later. but as i said some of the biggest companies on wall street reporting. i'll say it again in the last couple hours, boeing posting a loss $15.20 a share. that included $8.3 billion in charges related to the 737max and the delay in the 777x program. revenue meanwhile did top this at&t beating the streak on top

and bottom lines also added a greater number of post paid phone at&t announcing a $15 billion business due to cord-cutting taking a hit. i don't think there's a cord it's there, boomer andrew, talking to you if directv has problems -- can you call it cord-cutting that's like mixing a metaphor. isn't it, boomer i like calling you boomer. >> i should be -- in twitter, they're calling me boomer all over now >> that's the nicest thing they're calling you, boomer. >> that's true that's true. >> some of this is not -- i'm going to flag some of is this. >> that's true apparently, by saying that you should be cautious as an investor out there, we are supporting the man we are supporting the wall street man >> i know. >> and we're not supporting the retail man i think the reason why we're

trying to be cautious here there are going to be retail investors unfortunately that almost invariably going to get hurt and invariably, people are going to point fingers and i think it's a responsibility to at least say there are meaningful risks at play here >> it's a really interesting dynamic with the options involved and the big short positions. and the way it's happening and the hedge funds that are involved all of these things. just we're making a point that gamestop itself, you can't talk about the valuations that we've seen, fundamentally, with some of these stocks. they're being used as a vehicle to do certain things that's all we're pointing out. i mean -- i don't think any of these people that are doing this really believe that the fortunes of gamestop has changed that much or any of these -- these that are being moved around like this >> right >> the fortunes of the company hasn't changed that much maybe the shorting did

maybe the hedge fund community, as you double-short something. who knows. yeah, becky. >> i mean, how much did the shorts drive it down beforehand. >> right >> how much does this change that play. you know, it's hard to see where the forces are before and after. >> right but now, it's -- you know, the nasdaq is bad. the ipos are bad you're bad, everything's bad and now we're -- you know, it reminds me -- i mean, there's no guillotines around, are there? like the french revolution some people are making comments akin to that you know, we're mad as hell, we're not going to take it anymore. you're seeing that, right? sorkin, i know you are >> this, to me, reflects -- this is almost the investing version of occupy wall street. but the distinction here, people actually have money on the line which is very different than a protest. but this is a protest vote with money. but ultimately, what i worry about is the protesters may be the ones that lose because you can't play this game

without money. and that's the hardest part about it you can't play the protests. let's get everybody up to speed about what is actually happening, though, this morning because there have been two big developments in this gamestop saga and extreme volatility that we've been seeing in the stock it's trading up of cours 229. and now from citron, posting a video to youtube earlier this morning. here it is >> i'm just fine citron capital is just fine. covered the majority of the short in the 90s at a loss. a small manageable position and i'll let it go for those who have a short memory, you may remember till rate a few years ago it was a killer. i saw where it went, all the way to the mid-200s. settled back down. went all the way to $6

i expect the same thing from game gamestop, but i have respect for the market >> in addition to that news, we learned earlier this morning that hedge fund melvin capital says that it has closed out its short position in gamestop i spoke to gabe plotkin who runs that firm. took a big loss, it's up clear precisely how big. manage plotkin revealing he closed that position in a call earlier this morning saying he did that before th close yesterday. he also said that speculation that the firm would file for bankruptcy is false. that rumor going around reddit and on twitter and you can see shares of gamestop have come well off their highs from earlier today the stock ended yesterday at 92%. at around $150 a share then it soared this morning in the premarket to $360 before topping. yesterday, gamestop trading was accompanied by tweets from very well-known names on wall street.

who were fanning the flames in truth. chamath palihapitiya reporting that he had purchased calls. and then getting out on twitter saying he was going long wit the stock. after the markets closed, elon musk tweeted simply "gamestonk." in reference to the stock. and the stock took off from there. i think with the responsibility that some of these players have in this as well. we've got a programming note you don't want to miss this, because palihapitiya is going to be live today, scott wapner has so many questions for him about some of the things he's been saying publicly behind this. and chamath palihapitiya, guys, effectively yesterday saying he was running for governor of

california between his spacs, his gamestop buying and potential run for governor, he's in the middle of a lot of things. >> wow not to mention leading the recall for gavin newsom who is the governor of california now a few things to talk about with scott later this morning in the meantime, let's talk about earnings, the broader market and the rate decision from the federal reserve joining us, rick reiter, ahead of the global allocation team at blackrock. rick, with what's happening in the market i want to talk about the fed and other things but i know you think the fed isn't going to do much today let's talk about the market right now. seeing the weird positions out there, gamestop and others how prevalent do you think this is in terms of the impact in the broader market is it just noise around the edges, obviously a big deal for anybody who is an investor in those stocks, but could this have an impact on the broader

market as well >> becky, it's a great question. when whenever you see this volatility, this aberrational movement, is it does have an impact it affects confidence in stability of the markets by the way you get rebalancing that takes place that people are on the wrong side or the right side of a dynamic like this so, you create these weird dynamics, one thing i can tell you from putting money to work in the markets from my perspective, you just got to keep an eye on it, put it aside. do your research around what are the names you want to know and what are the durables in the marketplace. no doubt, this has an impact like a lot of things it captures the imagination of people. it's a story quite frankly, when you get -- i'm never a big fan when you get this sort of aberrational movement because i think it just takes away from good, quality investing. >> i guess that's the bigger question, though, we talk to people all day long who do

fundamental research on companies that really figure it out down to the dollar on where they think the stock is headed based on the fundamentals underneath it. how much of the speculative fervor is based on analysis? is it better to do a researched analysis on all of these companies right now? >> it is, becky, but with equities, in the other role as fixed income, with equities, you're right, when you think about equities, you can have a very wide fan of dispersion of what it can be when you get this volatility, then it expands it further so where does that happen? when you think about your portfolio and technology is the place where you get that much big fan but bigger upside. we looked at the earnings last night like microsoft and what we're hearing this week putting where are those businesses going and what will people put to the valuations certainly becomes harder but, listen, thing when you

build a balanced portfolio, when you think about, gosh, i've got technology i've got my core financials positions, i've got cyclicals. you can put a general level where prices will be when volatility picks up that fan just expands >> yeah. we should give you a shoutout, too. the global allocation fund you that oversee did incredibly well for 2020 >> thank you >> it was up 778 bases points, better than the benchmark. huge for outperformance there. >> thank you >> makes you wonder where things are heading based on that performance. you've been really positive on the markets. do you see that continuing, even with the speculative stuff in the background my guess is you're positive on where you see things heading? >> i am, becky it's like a math equation, when you figure out where do you

invest and you try to figure out what is your constant and variable within the portfolio. i think the constant is the economy's going to grow faster than people think. the amount of stimulus, the amount of monetary policy that is going to support that stimulus which we're going to hear today is extraordinary. the growth is good so the companies that pivot off of that we saw microsoft last night. be interesting to see the tech earnings that come off the backside of it what we try to do -- by the way, the position is different than last year. last year, we used a lot of interest rate in the portfolios as the fed was dropping interest rates. today, it's more cash. and quite frankly, we've shifted around some of our technology holdings where the big tech we've reduced a bit. we still like a lot. more semis and parts of software, by the way, not parts of software, where we've gotten overzealous we've shifted financials than we

had last year. a different framework for how you think about your portfolio in '21 >> why more cash jury holding that as a hedge against what >> yeah. so, you know, every time -- we try and build balance in our portfolios and think what did treasuries do for you? what it high quality fixed income assets do for you in the portfolio? they provided balance and price return when times needed when interest rates go to zero, we're interesting in great companies, some of the issuance, we've had 100 billion of supply this year, a third of it has come inside of 1%. the upside return, the convex of holding the offsets are not great. given what the fed has brought, they're not interesting so we've made the decision let's just hold more cash the cost of holding cash is not that expensive and then take the risk where we want to take the rick.

s risk so it's a different framework. having that cash allows to you take advantage of significant opportunities that happen in the market day in and day out. when it comes to the market. cash is your friend in an environment like this. >> it certainly makes you more flexible are you waiting for pullbacks in the markets to do things are you waiting for specifically in sectors waiting for new issuance coming on >> so, we're in a robust new issue of time. every day there's things to look at we're obviously doing some of that the other is, i'm not sure, you get things today where the volatility is extreme. i wouldn't write it off either, given as you were describing earlier, there's been some froth in the markets that tends to get pullback before the markets cleanse themselves and rally again. we're holding in case you get some of that but in the market today, given to what's happened to fixed income assets given to what's

happened to equities the opportunity set is just not it was six months ago, a year ago, three months ago for sure. so withholding cash and waiting thing for things to develop is negl negligible >> that assumes, i guess you think inflation is not taking off and the market's not going to continue to skyrocket, that you'll have an opportunity -- that's the opportunity cost of holding cash >> so, yeah. totally. and by the way, you can create data in the portfolio, what's happened as volatilities come down it's allowed you to take upside in options. you are not necessarily from a beta have to sit on the sideline but being able to use that upside convexity and using the cash that aren't doing a lot for you. does create that i don't think we'll miss the upside but we're better protected in case you have more volatility and more arsenal to work with to take advantage of what comes

down the pike. by the way, i think inflation is moving moderately higher i think we're going to hear this from the fed today i'm not concerned it's going to move dramatically higher, a near term because of the capacity taken out of things because of energy i'm not that concerned with the fed getting away from us a bit higher but not worried that my cash is much less valuable >> rick, thank you good to see you. >> thanks, becky, appreciate it. >> joe >> thanks, bec >> coming up with a special interview with blackstone's jon gray first, let's get you caught up on headlines microsoft beating estimates in the latest quarterly report. revenue from the azure cloud computing unit was 50% from a year ago big jump in gaming i guess people are buying a lot of their surface products as well as they stay at home. starbucks posting revenue,

global consort sales well more than expected. starbucks coo roz brewer is leave the company to become the ceo of walgreens in march. we'll talk much more about that story later this hour. stay tuned you're watching "squawk box" on cnbc every single plan. and save 20% on your bill every month versus the other guys. that's right. the iphone 12 on us. only at t-mobile.

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welcome back to "squawk box," everybody. futures are under president bush this morning if you haven't seen this yet, it's a picture that's gotten worse. dow futures down 270 points. we've been down as much as 300 points the nasdaq was in positive territory at the start of the show nasdaq indicated down 32 points and futures down 37. andrew blackstone one of the biggest names reporting quarterly results this morning the investment firm posting distributable earnings per share above expects with a jump in the portfolio. 32 billions of inflows just in this past quarter. joining us right now to talk exclusively about the company's

numbers, current and future investments and what we're all seeing in this market right now is jon gray, president and chief operating officer of the blackstone group good morning to you, jon i do want to talk to you about the markets at the moment. as you know we've been fascinated by the phenomenon of gamestop and spacs with the markets and valuations and the like let's talk about this past quarter at your firm and what tell says about where we are in this economy right now. >> good morning, andrew. it is great to be here again yes, it's a challenging economic climate. but we had the best quarter in our firm's 35-year history as you noted, we had report distributable earnings record fee-related earnings, up 36%. we had record appreciation across our portfolio which is what really matters for our clients. we had 30-plus billion dollars

of inflows nearly $100 billion for the year it was a great quarter on every metric for us. why it happened, one, was obviously the strength of markets in the fourth quarter. secondly, i would say it's where we've positioned our portfolio the last few years big exposure in things like life sciences, digital payments, enterprise software and then finally for us what i'd say is we're seeing incredible growth in what we call perpetual capital. things like core plus real estate direct lending infrastructure, insurance. this provides a tremendous base for us in growth in the future so, a really good quarter. and what turned out to be a better year at the end than anyone expected. >> jon, you and your firm and your peers are considered the smart phone in this market so, one of the questions i would ask you is, right now, do you consider yourself a net buyer or

a net seller, given the prices we're seeing in the public markets and how you're thinking about these private investments? >> well, it's interesting. the fourth quarter says a lot. we were most active in both selling and buying in our firm's history. and i think it speaks to the breadth of our platform. so there are parts of the market that don't look great. i think long duration fixed income is not a great investment these days obviously, there are parts of the public market, places like renewables, some of the tech companies that are trading on sales, as opposed to earnings. so there is some excess in the market, obviously. but then there are other places where we like opportunities. we like private credit we like some of the covid-impacted businesses where we think there will be a big recovery things like travel entertainment. transportation infrastructure. and then there's some of the big trends that are happening as we

move online. shopping's moving online gambling it moving online. dating is moving online. payments, software there are businesses that are not just the applications themselves but logistical supply support to that, compliance support we're looking at that whole ecosystem. and then i would say geographically, i think asia is pretty interesting they're coming out of the pandemic in a stronger place than the u.s. and europe and we're spending a lot of time there in both real estate and private equities so, there's always opportunities somewhere, but, yes, there are some places where prices have moved up quite a bit >> jon, we've talked about spacs before but the phenomenon just continues. as an exiting strategies oftentimes for venture capital and private equity firms what should the public retail investor think when they see you pursue a spac versus, for example, an ipo or a salesman of

a private equity firm? >> well, i would talk about the spac sort of phenomenon sort of generally. and i would say i know there are concerns because of the number of spacs coming out. some concerns about alignment with sponsors. their economics. you know, how they get paid and the amount and so forth. but what we see the spac development generally as a positive for markets and the reason why, is if you look over the last 25 years, you've seen about 50% reduction in the number of public companies out there. going public takes time. there's expense. you would oftentimes get price below comparable companies and that's led to fewer companies going public this year, or 2020, we saw the highest number of ipos in 20-plus years. i think that's a poo and so, why do we exit some of our businesses because it's the best way to exit we can get to the market

it's right for certain companies, for other companies, it's not and as you've seen, a number of these spacs had performed well because they bought good businesses we feel really good about companies we're contributing to spacs today. >> do you think there's a mania at all in the market, a bubble forming? i mean, we've been talking all morning. i'd love your thoughts on it i know you're not involved in it but i'm sure you're watching it with the same fascination as the rest of us, this gamestop situation. >> yeah, there are definitely operations in the market where we're seeing speculative fervor where it's more gambling in some respects than maybe investing. obviously, it gets a lot of attention. we tend to be longer term investors so it's not our focus. i think it's worth watching here ultimately companies in the fullness of time tend to trade around their underlying value. so there will be people who make

a lot of money in the short term some of these situations may not turn out well. ultimately, i think investors should look at the fundamental long-term prospects of a business that's what's really served us well and in this environment where there's so much economic transformation, you really want to focus on that >> jon, before i let you go, got to ask you about some of these reports about pension funds, making some calls to your office in regards to steve schwartzman's very public support over these several years of president trump and in the wake of the attacks, apparently, at least the report suggests, calls from pension funds concerned about some of the comments he might have made. what's the state of playing? what are people inside the firm saying? >> well, the important thing what are the facts here. and the facts are very good. and that's why our people internally and our pension fund clients feel good about blackstone when you look at the situation, we do not have a corporate pac

we do not make a corporate donations. so, we didn't have to stop doing that all the donations that were made to presidential campaigns are made individually. in our case, 130 people made donations to the presidential campaign 97% of the employees who did so backed president biden i myself held a couple of fund-raisers as it related to steve steve loves this country he did work with the president on economic and trade issues but when the election was over in november, he said it's over there should be a peaceful transition he said i look forward to working with president-elect biden. and then after the events of january 6th, he was very clear in condemning what happened. so, good facts tend to correlate with good outcomes that's been the case here. >> jon, we appreciate you joining us as always we look forward to the conversation in the future thanks >> thank you, andrew

all right. steve liesman has had plenty of time for this breaking economic data so, no excuses, leisman, what do you got? >> thanks, joe rick, i am not but orders for durable goods up 0.2% that's a miss on the 0.8 that was expected the november numbers were revised up to 1.2% so something of an offset there looking at ex-transportation new orders up, 0.7 that's strong. defense up 0.5%. looking here, big numbers, computers falling off, minus 3.4% it's been a strong area. communication is up 0.3. i want to get down to the nondefense aircraft, nondefense capital goods ex-aircraft. 0.6. that's a proxy for business investment i've got a list of things have

done very well pharmaceuticals, medicine. paper products, you can see in the order the increase in boxing and packaging materials. paints and woods for the home. household appliances that's done very well. aircraft has not done well i just want to take a quick look at that. yeah, this boeing order pulls down the whole -- the top line number nondefense aircraft down 52% with the on and off boeing, had a good month in december for manufacturing aircraft or orders for aircraft but it also had a lot of cancellations so that's been a very volatile part of this particular report. so, a look at ex-transportation here it's up closer to what economists expected, 0.7%. and i guess one thing we ask ourselves, i ask myself, anyway, when i look at what's held up these numbers here, and that's a lot of the computer equipment. a lot of the communications

equipment to the extent to which businesses have spent money and created inventory and productive capacity for people working at home >> joe, how quickly does that go away >> i don't know, steve, when you ask yourself things do you answer yourself? just having a full conversation? do people see you doing that typically? that's not a good sign >> asked and answered. all done >> steve, aside from the paper products that's mostly jay powell and all of the printing, isn't it how much paper are they using? isn't that part of it? >> joe, come to the 21st century. there's no paper they just hit buttons. it's all electrical. >> you're right. under 1% again, if you can explain that, let me know on the ten-year because we're supposed to be on our way we'll see. coming up, wall street versus wallstreetbets. the former is the establishment. the latter is an online forum

for the establishment that may be the enemy and lately, a horde of wall treat bets traders have been putting the hurt on professional money via game stocks like gamestop to take yoinde tu sihe campaign. stay tuned, you're watching "squawk box" on cnbc

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still to come this morning, we have more from andrew's interview with the ceo of robinhood as attention falls on retail investors active in stocks like gamestop plus, what starbucks loses walgreens gains as a key executive makes a career move. stay tuned you're watching "squawk box" on cnbc ♪ ♪ ♪ ♪

♪ welcome back, everybody. walgreens tapping starbucks' chief operating officer roz brewer as the next ceo that would make her the only black woman to lead a fortune 500 company. shares of the walgreens up .75%. kate rogers joins us >> that's right, roz brewer will be leaving starbucks at the end of february to become ceo of walgreens. she'd been at starbucks since 2017 as coo working on the company's transformation in format including drive-through and pickup and mobile order. and steam lining the customer experience prior to that she was ceo of

sam's club brewer will join a short list of ceoess of fortune 500 companies as you mentioned notably will be the only black female of a fortune 500 company. more women have come into the ceo position in 2020 than any other year i recently spoke with brewer whether or not starbucks would be mandating masks for workers just two weeks ago >> we're going to be doing everything we can to impact and improve thedistribution and execution of the vaccination process. and that's most important, to get the entire community vaccinated and to make sure that everyone understands the importance of that >> no decision yet on those mandates but vaccine obviously top of mind both in her work at starbucks and as an amazon board member companies who are working with washington state rollout efforts, even as she leads both of those positions, she's stepping into a roll where

vaccines and equity will be a key part of the job. becky, to you. >> kate, who takes her place at starbucks now? is there a plan that we know about? >> so, the company said yesterday it was kind of dividing up her roles among other staff members. it's important to note that roz was a big part of the diversity and inclusion efforts at starbucks, that's something that we also got to speak to her about two weeks ago. the $100 million fund to invest in small businesses. underserved communities we know it's important for starbucks, they're a leader in that space it's going to be interesting what importance they brings into that role at walgreens as well >> thanks, kate, good to see you. >> you, too. two dominant market themes this week have been earnings and the push/pull between short-sellers and retail inv investors. we've especially seen what in the shares of gamestop up 77 points but up from -- you

know, you don't have to go back very far to see single digits. amc is also making a big move this morning and then amcx which is amc networks i think it sounds like amc there's other news out as well but that's making a big move as well i think -- i don't know, because it's got those three letters in the name, maybe. joining us is greg branch managing partner and veritas mutual and greg, i don't know if you're watching the show or the saga that is gme and others. off the top of your head, what are your comments about this and does it portend anything for the overall market >> right, so, i think we have to separate two things. one of the things that we had a healthy debate about back in july is whether or not the

announcement on vaccines would provide a catalyst for the market and we saw it did where money rushed to things that we presumed would open up and have better fortunes once we were out and about again and largely, i think amc falls into that category, along with the airlines, along with other things gamestop is another story altogether there's no real way to look at that and explain it from a fundamental perspective. it's more in a camp of is it being manipulated, for lack of a better word, by a concerted and intentional short squeeze. but, you know, there's no way to approach that or explain that. in the fundamental terms that we're used to analyzing things >> i mean, you can defend short-sellers that they're looking at valuation, maybe they think something is going to zero so they're allowed to, in the words of a lot of people that

are defending the retail people, they're saying that the hedge funds started the manipulation by shorting more than the outstanding flow or deliberately trying to knock the stock down so isn't that manipulation too >> yeah, it could be and i tend not to think of things in terms of words like fair or unfair in our business, i think it's important that we recognize the rules of the game. and over in the last six, seven months, the rules of the game have changed dramatically. there's a basket of stocks we could name that defy any type of fundamental analysis so, i'm not for either side crying foul or fair or what have you, you know, as a professional inve investor, if you think that things are not constrained to the normal rules or the normal analysis that we've traditionally used, then it's incumbent upon you for both yourself and your clients to just steer clear of it >> ryan, comments on gamestop or

whatever you want to -- wherever you want to go, amc? >> sure, joe right, first off, joe, i haven't seen you a while congrats on st. x winning the football championship. >> the bombers >> that's right. let's get to it. we took a look the ten most shorted stocks as of yesterday in the russell 3,000 they were up significantly. most of them up 50% to well over 100% this isn't just a gamestop story. people trying to blow up the shorts the big question, is this 99, is this frothy? e we don't look at that. we look at the caller ratio being low. the center pole is frothy, maybe it's a sign. take a look at this, joe, we're option february, february, the worst month of the year, after

the inauguration, after a new president from the inauguration until about the middle of march stocks do pretty weak seasonally it makes sense after the a 200% rally in the s&p 500 more in stocks and nasdaq, maybe it's time for a break and people are optimistic but we would absolutely by that dip and still think it's a bull market >> the dip would total, what do you think, ryan, in the s&p? >> you know, this has hamatched the bull market. 10% correction in 2010, sometimes a 10% correction makes sense if we follow that pattern. we think we could. >> greg, the people right now are looking at short interest everywhere and trying to find an exit you know that's happening right now. >> yeah, 100%. >> i'm sure. greg branch, thank you, ryan dietrich, thanks xavier university, but i think it works for st. x, too.

and andrew joe, when we come back, we'll show you more from the ceo of robinhood talking about the current mind-set of traders who veeeketo the stocks we're seeing don't go anywhere. we've got more "squawk" right after this break ♪ when disaster strikes to one, we all get together and support each other. that's the nature of humanity. ♪ it has encouraged other people to take the time for each other. ♪ ♪

welcome back to "squawk box" this morning retail investor participation in the markets reaching new heights and euphoria, in some cases, here's a look at google searches for shorting stock, just in the last week, if you need some more

proof, just take a look at shares of gamestop, this morning, robinhood ceo is out with an op-ed. becoming an investor is the new american dream, just like home ownership was before in an interview, i asked him about this younger generation of investors, and whether he thinks they have the wherewithal and knowledge to properly be able to invest in this market. >> first of all, of course, we believe in education and that people should be informed, and in fact, we've made lots of progress and very significant updates, just last week, we announced a revamped robinhood learning portal which takes people from first-time investors and basic concepts to more advanced concepts around investing so obviously, i think education is going to be something that we're going to continue to invest in.

and tools to make sure we really enable first-time investors to become long-term investors, but the other thing i would mention is that i had an opportunity to talk to robinhood customers, and one of the things i enjoy doing is sitting in on customer research, which is a big part of our product development, and there's a lot of times where we hear this feedback that robinhood is one of the first products and companies that treats people like they're adults and meets them where they are. so many times, you hear, and we've heard our customers saying, that you know, other financial institutions or advisers are triing to sell me products, trying to tell me that i shouldn't be investing my own money, and that i should leave that to the experts. and robinhood is the first company that's actually treated me like an adult, and giving me, and meet meag where i'm at in my investing journey and giving me

the tools to empower myself to manage my finances, so we hear that a lot and i think that resonates with us, and the mission, very strongly of course, we need education but i think this idea that all retail investors are unsophisticated, they shouldn't be managing their money, and they should leave that to the experts or institutions is a notion that we just have to move past >> also, talked to him about how he thinks about a post-vaccine world. we'll go back to more of our daily live, and whether there will be less market participation. >> it's hard to say, hopefully we get there and we get past this crisis which has been affecting so many people and i think that, i think what is likely to happen is some of the areas where you have seen sort of a decrease in spending

probably, you know, as we reopen and people go out into the world, they'll be interested in spending again, they'll be able to spend again, so the ramifications of that typically have been positive for economies in the past, but we don't know how it's going to happen in this case, and we just have to, we have to be ready to serve customers across a variety of their needs. >> and back to you, a quick comment about treating the audience like adult, i like that sentiment but i just want to make one point, and you're seeing it today, which we've been talking about the amc theaters and that stock being up, given this sort of gamestop trade happening, but guess what else is happening? go look at the stock of amc networks, television networks. >> i know. that chart. >> i know we brought that up. >> just because amc is in the

name. >> i know. >> but that's the point of this whole thing. so you want to treat people like adults but i don't know what to do about this. i don't know what to do about it. >> a 20-year-old - >> we'll talk more about this. the train's momentum >> a negative balance. >> right >> and we'll talk about some of the hedge funds that are making, that are going to be paying out during all this, what's working, what's not, we will tell you of the story ofha wt wall street versus wall street bets, when "squawk" returns

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reach out to traders who aren't just taking on hedge funds, they're trying to take them down. social media is driving this new phenomenon and it is changing the investing game, we're talking about it all morning, leslie, joining us now good morning >> hey, joe, good morning to you. and that's right, most people had never heard of the hedge fund called melvin capital, just last week, and it's currently trending on twitter, the firm surfaced on the reddit forum known as wall street bets months ago when it's revealed in a quarterly s.e.c. filings a number of puts and gains like gamestop and be, bath and beyond and these have surged, melvin suffering losses of 30% in the year up to last friday a source told me. it is my understanding that the p&l looked very grim before citadel and point 72 gave a cash

infusion on monday melvin said this morning, that it has, quote, repositioned its portfolio, over the past few days, and closed down its position in gamestop, short seller andrew left, also putting out a video on twitter, saying he covered much of his gamestop short at a loss. the day traders on these forums are really reveling in the power of their collecting shauden freud, they have a group of investors pushing gamestop higher including poptilla and elon musk and the winklevos twins and they may mind their next hedge fund target with fourth quarter due out in two 1/2 weeks time which could reveal how other firms are positioned it is worth noting that short positions are not disclosed but options are. guys >> winklevye >> yes >> fund. >> thank you, leslie more on this story throughout

the day, including a live interview with chamath at 12:30 eastern time that is must-see viewing you would think, especially today. futures right now, as you can see down, about 300 points who knows, nothing surprises me anymore. we'll see you tomorrow both of you. andrew, becky, make sure you join us. "squawk on the street" is next good wednesday morning welcome to "squawk on the street." i'm carl quintanilla with david faber, jim cramer has the morning off, dow futures do imply a fifth day down, the longest losing streak in almost a year when we watch gamestop and company, a fed decision this afternoon and q4 earnings from corporate giants and this hour alone, boeing, amd and starbucks ceos will join us and another morning where we will have to start with gme. >> you heardes