good morning breaking news overnight. u.s. health officials raising concerns of astrazeneca's vaccine data less than 24 hours after first published. stock futures pointing to a lower open after the session for the major averages a couple of ideas of what is moving. and why president biden's proposed wealth tax could be a double tax hit for taxpayers and the wealthy, it says here, are a little salty about it. i don't know whether all of them are or some or a few it is tuesday, march 23rd. "squawk box" begins right now.

♪ ♪ good morning welcome to salty bucks i'm becky quick along with joe kernen good morning get your microphone ready. checking out the futures this morning. here we go >> it moves around >> it does it does. slippery especially with the silk tie check it out dow futures are under pressure down by 150 points this comes after the update for the markets yesterday. the dow up by 103 points yesterday. a modest gain with the s&p and nasdaq that was in large part because of what we are seeing in treasury yields. s&p off by 19.

treasury yields fell this morning, the yield is down 1.642% really below the call a few weeks ago, joe >> right where it was. actually that day when it was 1.6. it actually went down after the call a couple of basis points are you -- i have some ideas for the "squawk stack. >> i hear. what are you thinking? >> santolli is here. i almost tapped in to you for your expertise the journal talking about investment grade corporate debt is performing miserably.

i added crude. the reason i added crude is because it is now 4% and european stocks are down germany extended the covid restrictions until april that has a lot to do with the sentiment about what is going on with covid the strains. becky, you asked astrazeneca yesterday -- when meg was on when were these things done? did they test the new variants now the story out today is we are not sure when it was done and if the efficacy data was done and that was the question that the u.s. asked. now i'll do something promotional. this is the "squawk stack" and it's tough if you don't like it, you can lump it. i'm alternate wti crude with penn national. we have the ceo coming on. we can use it for whatever we

want we have jay snowden after the miserable march madness season there is nothing going on today. preseason major league baseball. nothing. penn national will not do any revenue today. i'll talk to him i have one other point yellen and powell are talking today. do you ever remember where a former fed head then joined an administration and could just be like a -- >> no. >> be an administration official and do whatever they want? when we read, yellen says this, i still hear her saying it with the gravitas of the importance of a fed chair this is like jack lui says

something. it is a mouthpiece for the economic whatever the administration has on its plate. it's on the docket it is like saying ben bernancke saying we need to do these things can you imagine alan greenspan being the treasury secretary and pushing political agendas? >> i guarantee greenspan spoke in congress. he spoke after he was chair, i imagine. >> not at behest of the administration. >> very much a voice in favor of certain policies not necessarily as a spokesperson for the administration >> because he believes in them >> by the way, we have a more fiscal driven situation right now versus monetary driven maybe they can move markets

sdpmarkets. >> when she says we have to raise rates. she is no longer speaking as a member of the fed reserve. >> it is not like she is the ceo of penn national >> that is coming up at 7:45 did i mention that >> if you are tempted to bet on spring baseball, you have a problem. >> i said look at this all of the games are at 1:00 i tried to find standings. >> they don't barely keep score. >> i'm not going to do that. the lakers might be something to look at tonight. lebron's hurt. i looked at that i'm thinking nba becky, how much do you know about the march madness for the ladies do you think that's anything >> i have not followed closely >> santolli? >> not really. >> i didn't follow the men's

att tournament either. >> i'll find something maybe it's good. i'll take a break. here is the news you were talking about, becky >> the only reason i don't worry about you, joe, i know you bet $3 and $5 at a time. if were you betting more, i would have serious concerns. >> portnoy had $50,000 on a basketball game. my hands started sweating. he won that one. he took smu. he had 7 points. i think he may not have been doing as well. we will ask jay snowden about that today he may know how he has been doing. there is the penn gaming plug again. >> yeah. >> they never do that on "c "closing bell. let's get to the breaking news overnight joe mentioned this this is important. federal officials said results from the astrazeneca vaccine trial may have relied on out

dated information and may provide an incomplete view of the efficacy data. that comes after astrazeneca said its vaccine was 79% effective against covid. the head of allergy and infei infectious diseases released a statement. that had been overseeing the u.s. vaccine trial the officials are urging astrazeneca to work with the monitoring board to review the efficacy data and make sure that up to date numbers are made public as quickly as possible. yesterday, we spoke with former fda commissioner dr. scott gottlieb after we interviewed the ceo. he weighed in on the efficacy data and the press release. >> i think we need to see the full data set. i had difficulty in interpreting the press release they put out in the past. i like to see the bottom line

data it is an encouraging top line result of 79% as another entrant if not in the united states, but around the world as well >> you know, that was impressionable from dr. gottlieb that he wants to see more data it is worth pointing out because the company has run into problems in the past with data back in november, they had the issue ywith the efficacy came because they were incorrectly dosing patients. some patients got a partial dose and they he ddidn't catch it at first. they realized it later and slipped out that information later. we had an astrazeneca official who came on that day and it was later in the day when one of the scientists was talking and saying it was serendipity that the dosage worked.

how did we not know that earlier? why are they just saying it? you think they would have learned from the problems with the data in the past if there are questions raised again, you have to be kidding me what is the next issue the other problem with the older data last year in november was that the efficacy numbers, the promising results did not reflect older people in the tr trials older people are the most impacted by covid. here we find out more about what is going on. this is a company that has run into problems in the recent past with the data put up about the covid trials >> reputational issues with astrazeneca that predate this latest stuff raising a few eyebrows the overall covid data is crappy new jersey is leading the nation again, we just had murphy on governor murphy and how things were going better.

now it is 1.09 or something on the transmission rate which means it is growing. some of the data is stubbornly high with hospitalizations and new cases and also deaths rising again. above last week from the week before they point out we're in the foot race now trying to get people vaccinated in new jersey a lot of places to go. it is confusing of who is allowed to get it. i've gotten it i'm trying to get other people to get it. kids, you don't worry about is the -- about 19 or 20-year-olds. >> not at this moment. you will find them vaccinated within the next month or so. that's why you call it a foot race we are watching cases tick up slightly because people have let

down their guard some. you wonder if what is happening in europe or brazil where things are a real mess right now. you hate to see that deaths in brazil are very concerning >> people at the pharmacy toward the end of the day you have vaccines. you hear about the lucky situations that makes me think is that what we need to do >> we need to start doing that >> you look like a drug addict or something i have actually considered, you know, whether that is the way to do it. you worry about making it this far. it would be horrible for someone you care about to get it now >> yeah. >> scary always scary a year of being scared is not good for anyone's mental health or anything else we'll look back on this 30 years

from now -- i hope so. 30 years from today and think about the year of 2020-2021. mike, you are going to take us out? >> what a difference a year makes. today is the anniversary of that market bottom march 2020 more stats after the break later on the interview with robert kaplan "squawk box" will be right back. >> announcer: this cnbc program is sponsored by truist securities hey, guys! they have customized solutions to help our family's special needs... giving us confidence in our future... ...and in kevin's. voya. well planned. well invested. well protected. in peytonville, there's lots of ways to save on auto insurance. really? yeah. very proud of that. with smartride® from nationwide, they can get discounts for safe driving. does she get one? mrs. carmichael?

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today marks the one year and versus ri of the market bottom the broader markets were in free fall the s&p lost nearly 34% from the february 2020 peak set the record for the fastest 20% bear market ever lasted 16 days or took 16 days to get there from the low last march, markets soared dow and s&p moved up more than 70%. the nasdaq is up more than 90% the next guest says this is the best frs irst year of the bull market, but we could be headed for the larger correction in the second year of the bull.

we have ryan with us this morning. good morning >> good morning, mike. thank you. >> we're calling it a flash bear market it lasted several weeks ending a year ago now first year of a bull market. what are we led to expect based on history not only is this the best first year of a bull market by a significant margin better than the 2009 run. >> mike, what a nice year. a lot better than a year ago we're up 76% on the s&p in the first year that does top the best first year ever from 2009 up just under 70% or so lpl research took a look at 30% bear markets since world war ii. we're talking the big ones like we had amazing thing, mike, year two, starts today, was higher every single time. up almost 17% on average

the thing we are telling our lpl advisers is this is still a young bull market. this is still a young economic cycle of growth. it is rocky and choppy it is not easy the average pull back is 11% we would not be surprised if this is an above average bounce or above average correction. one year from now history tells us as mark twain said history repeats and rhymes >> an upward trend maybe with more choppiness more down sides along the way. ryan, if it anticipates what people are saying is push back this was anything but a typical experience in terms of the b brevity of the pull back and roared higher in the v

the magnitude of the fiscal and mo monetary response. we have late scycle valuation. how do you contend with those questions? >> this is a 34% correction. we have a 34% correction in '87. that took two years to make up we made up this one in five months all of that stuff is out there at the end of the day, i like to look at two things to see how markets do the credit markets are doing and the advance decline lines are doing. keep it simple credit markets are not worried quite calm some of the devastated industries are calm. look at market breadth mike, we get all those concerns. the fundamentals are there and the breadth is strong. if you bet against it, you will miss out on good gains. >> what about this kind of coric choreography with bond yields

and determine growth stocks? we have the huge comeback for cyclical stocks. we have come into a pause period here how would you navigate that? >> we think it makes sense 10-year up 170 the economy is coming back we don't think this is abnormal for the 10-year to be here we think it got ahead of itself. at lpl, we said we like growth over value and now we're more 50/50. the reopening names. we have not thrown away technology and communication that is where the growth and earnings are coming from we have evened up the portfolios >> all right more balance into year two ryan, i appreciate it. thanks a lot. >> thank you thanks, mike when we come back, another big price tag for an nft

the big pay day for jack dorsey's first tweet that's coming up next. >> announcer: this cnbc program is sponsored by baird. visit bairddifference.com. ♪ ♪ we know it's going to take many forms of energy to meet the world's needs while creating a cleaner future for all. at chevron, we're lowering the carbon emissions intensity of our operations, investing in lower-carbon technologies,

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four, five, turn, kick. wewe got chased byre fthese wild coyotes!e. they were following her because she had beef jerky in her pocket. (laughing) (trumpet playing)

someone behind me, come on. pick that up, pick that up, right there, right there. as long as you keep making the internet an amazing place to be, we'll keep bringing you a faster, more secure, and more amazing internet. xfinity. the future of awesome. the first tweet that jack dorsey posted has sold as a non-fungible token or nft, for $2.5 million the ceo of the block chain company of oracle. he now owns the digital

certificate of the tweet he tweeted yesterday this is not just a tweet i think years later will realize the true value of this tweet like the mona lisa painting. it was my hope that some day we look back and say, ugh do you remember? we used to tweet and waste our time doing that? maybe not. i'm glad i didn't buy my first myspace posting that i did on myspace. i never did myspace or facebook. really 100 years from now, people are going to go there's the mona lisa and then there's jack dorsey's tweet >> i'll take the mona lisa >> the recording of edison >> that's a telephone. >> yeah.

so >> this is woke twitter mobs telling mainstream media how to think. this is not good this is misery >> this is the way of the world. >> misery and hate and anonymous snarkiness >> the story is people with the huge store of bitcoin or cryptocurrency and converting it into something else. >> so they are not exposed bitcoin is down today. >> it is like going to the arcade and cashing it in fora toy. >> i can't help that nft is tied to cryptocurrency. if you really are looking to dive diversify, buy real art. >> i think you have to look at it as an arm of collecting and consuming. this is an asset allocation into a tweet. >> you laughed at me when it was

at $5,000. you got famous from your laughing. >> i laughed >> at my $55,000 -- that's on twitter. the snarkiness that comes from laughing that day. what about hockey? i'm hearing devils/flyers might deserve my attention tonight. >> you are a desperate man >> the two teams trying to win as opposed to practice baseball. >> practice. right. that's sad this other guy -- >> i'll just flip a coin you can bet on where it will be heads or tails >> becky, do i like to talk about food sports, food and my dogs this guy says. sports, food and my dogs i like to talk about other things. >> nailed it >> talk about other things that's not all i resemble that.

david watching yesterday talking about this thing >> he probably has been. he has been listening to employees. we have a response from the goldman sachs ceo. addressed junior bankers workloads. he talk about the pressure to be 24/7 the comments were in response where younger employees noted burnout was happening from the 100 hour workweeks and demanding bosses especially with the boom in deals with the surge of spacs. goldman would strengthen enforcement of the saturday rule that junior executives are not required to be in the office from friday night until sunday morning. he also said in the months ahead, there are times when we're going to feel more stretched than others. remember, if we all go an extra mile for our client, even when we reach our limit, it can make a difference in our performance.

trying to soothe some of the concerns, but pointing out there could be some times in the future, near future, when you are stretched thin once again. >> yes yes. you know, i don't know why i engage if i really don't like twitter. >> i can't believe the number of ones you respond to. i woke up at 4:00 a.m. yesterday morning and looked at twitter and you are responding already are you kidding? let it go. >> i don't let anything slide. most people say why let it bother you i don't care if they have zero followers. you can't say that i'll say something back to you coming up, we'll tell you why president biden's proposed wealth tax may mean a double hit for some of the nation's wealthiest people. and a look at yesterday's s&p 500 winners and losers ♪ ♪

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♪ ♪ cause i'm the tax man ♪ ♪ yeah, i'm the tax man ♪ good morning welcome back u.s. equity futures are under a little bit of pressure after the update from the north markets yesterday. the dow futures are off 150 points the biggest decliner the nasdaq is down 38 points nasdaq was the best performer yesterday. 1.25% after rates were held in line joe. >> watch how this works. if rates come down too much, people will say, oh, my gosh the economy -- >> what's happening? >> the market. it will be within three basis points of the sweet spot

>> we are the opposite of goldilocks >> just right. 1.66 to 1.69 the wealthy could be hit twice by the tax man robert frank joins us now with more we didn't play the beatles "tax man. we played a different one, robert limited number of songs for taxes. we'll find them. >> over the next few months, we have to find more. it will be a big topic of conversation president biden saying the wealthy would pay the same rates under his tax proposal as they did under president bush with the top rate of 39.6%. for much of the bush term it was 35%. the difference between then and now is salt. the salt cap created an effective tax hire for many high earners in high tax states

raising the rate to 39.6% would amount it a second tax hike for those folks. in 2008, the combined state and local and federal effective tax rate for new york city residents was about 43%. under biden's plan, the combined rate is over 52% partly because of salt and state and local taxes have increased during the time period. add it together, biden's tax would mark a 9% tax hike over the bush years compared to now it is possible that biden and congress could repeal salt repealing salt would cost the government $100 billion a year in lost revenue. that is three times the size of revenue increase of the 39.6% rate hike. joe, as you mentioned, 80% of the benefits of the salt repeal would go to the top 5% this is going to be a tough

push/pull for the democrats going forward. >> when you said $100 billion, i initially said we just spent $1.9 trillion and the new infrastructure deal that we're putting together is $3 trillion. honestly, i said, $100 billion don't talk to me about $100 billion, robert, right you are worried about that repeal that salt it hit us in new jersey. becky is going yeah. repeal becky? >> good luck with that i'm in favor of it good luck. >> it's not going to happen. now for a closer look at the tax plan and the impact on the individuals andoriginations. he sits on the oversight and reform and armed services committees congress member james comer.

the first district of kentucky he is a member of the ed equeducation and labor committee. we had a conversation with a member of the president biden's cea team she talked about fairness. we tried to drill down on what fairness actually means. it means different things to different people we really need to get a firm gr grasp. my point was that if high earners are paying greater than 50% which you heard from the report if you are at 55% or something like that, do you feel okay going to those people saying we think you should pay 60% or 65% or 70% because you have so much? is that fair >> joe, i don't think that will happen we are talking about repealing salt, as you know. i don't think the salt deduction repeal was fair.

it taxed states that wanted to invest in public education if we repeal salt and allow for the deduction and increase the tax to 39%, you will not have the rates you are talking about. s>> you listen to my $100 billin analysis and were nodding? you think that's possible that salt will go >> i do. it has a huge support in our caucus you have senator schumer pushing for it i will say this. i have no problems with wealth generation i think it is great that we have entrepreneurs. i heard your earliier segment. i'm not sure twitter is mona lisa everyone should have a health care and education let's all invest so every one has a shot at the american

dream. >> maybe it is more like a picasso. reclining lady you have no idea okay congress member comer, is it fair there are people proposing 50% or 60% or 70% at a certain level or a wealth tax. a lot of people who accrued wealth, maybe they were lucky. many paid ordinary income on the earnings through their entire life and accrued this and now it is capital gains is that okay is that fair because they have so much to just take it? >> no, i don't think that's fair i think that is bad policy the democrats in washington had just really drifted so far to the left that they're not recogniza recognizable you used to hear liberals say we want to raise taxes to be able to have more money to spend on

more government programs now we have seen in washington the last few years you can spend and you don't have to come close to balancing the budget the objective is more for trying to redistribute wealth than generate more money for more government spending. i don't think it is fair when you talk about the salt deductions a lot of the people in the biden administration forget about property taxes and the people that live in the high property tax states they were the losers in the trump tax cuts i think this is something they need to think long and hard about. we're just now getting the economy back on stable footing and a big tax increase is not the way to go. >> congress member, the other thing that i think a lot of people out there when we were having that discussion yesterday, we all would like to make a difference in terms of increasing opportunity across

the board for americans to try to solve some of our inequity and problems a lot of people philosophically don't think the government is very good at doing that. if we did double the amount of revenue the government was taking in, do you have a high degree of confidence that it's going to make a difference for the people that need it to make a difference for >> i do think we have to prove that it is true a lot of the job training programs in the federal government have not worked we have to be more creative with the private sector and show success. we have to have industrialition of the country to answer your question, does government have to show its competent to earn people's trust? absolutely we have to do that as opposed to

throwing up our hands and saying government isn't going to work let's have china make the investments. >> right there's always the notion that a lot of people that would be hit on the high end would rather do it through philanthropy. and in their view, their dollars are better spent with philanthropy history doesn't bode well for the argument that the government will do better than philanthropy >> joe, is that really fair? do you think jack dorsey or the person who spent $2.5 million on his tweet should decide where that money is invested will they spend it to ind

industrialize the midwest? it should be the american people and not just the silicon valley. a lot of the philanthropy is outside of the united states. >> i see a lot of philanthropists doing what you said obviously it is not monolithic congress members, we have sound that may kickoff more of a discussion let's look at it. >> we need a tax system that values work over wealth that makes sure that everybody pays their fair share and where we're incentivizing for the economy in the short-term and long-term and not just the quick hits. >> congress member comer, i cannot disagree with anything that was said there. it is nebulous everybody pay their fair share and we should value work

we should all try to do good when you drill down, that's where you get some of the details and get troublesome. what you think fair is. >> exactly everyone would agree with what she said i think the government should look at the tax credits and make sure that people are paying what they are supposedto pay before we tinker with the tax rates again. it is impossible to plan if you are in business or high income earner who reinvests their money back into the economy which is what we're supposed to do and the capitalist society with respect to the biden plan, just increasing tax rates with no clear economic plan or vision, i think is more just to please the liberal base. again, i think the goal is more for redistribution of wealth than to create some sound fiscal policy or try to balance the

budget or anything like that >> you know, congress member comer, we had a discussion yesterday about evasion versus avoidance. there is a lot of avoidance that is, i think, legal under current tax law that still does violate the spirit of the law the way it was intended it allows a lot of wealthy people to get around paying what policymakers which they would pay. i don't know if they would go to jail i don't know if they would have a problem under audit. this is what we meant to do. this is the way people are getting around it. let's tighten things up and make sure that we get what we're looking for. >> absolutely. i think that's the best plan moving forward you know, there are few audits anymore. that is an area. if i were a democrat wanting to try to make sure that the rich guy pays more taxes, i would

focus on the irs and auditing more look at depreciation i served on the bank board over a decade i will tell you the guys in rereal estate take advantage of the depreciation and a lot of people that make a lot of money that own a lot of real estate, the real estate appreciates in value. they take the depreciation and don't pay taxes. those are areas where the biden administration should examine and not just increase the tax rates significantly. >> we have to go congress members, thank you. i just dug up my first tweet i wonder are you interested at all? >> about $100. >> $100? sold sold >> there you go. >> sold. thank you. all right. i'll send the you the certificate. >> i got a deal on that.

>> that's a steal. thank you. 20 bets for you? coming up, stocks to watch we talk transports straight ahead. later, don't miss the interview with robert kaplan on the road to recovery and inflation and much more. this is how you become the best! [music: “you're the best” by joe esposito] [music: “you're the best” by joe esposito] [triumphantly yells] [ding] don't get mad.

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still to come this morning, the transport stocks are flying higher as the country continues to reopen. we'll be bringing some names for your portfolio right after this. as we head to a break, look at crude oil down 4%. real concerns about whether the reopening is going to continue at this pace wti is 59.20 "squawk box" will be right back.

zwroo welcome back, everybody. the transports are tipping to make a run they're up 107% from the market bottom one year ago. joining us to talk about what's working and what she expects to

keep working is katheryn thompson katheryn, we know this reopening trade is here. we've seen it take off but you're looking for things you think are bargains within all of this. why don't we start talking about one of those stocks off the top. one of those is allison transmission tell me why you like that. >> one of the things you want to look at, themes and how they capitalize on the themes in transportation one of the themes in transports right now is just a shortage of drivers and qualified drivers, particularly ones that can drive a man all transmission a big focus for allison is on automatic transmissions. this solves a little bit of the problem that provides vehicles more people can drive as we try to meet that qualified driver standard the other basic thing, if we're doing a lot of short haul and

demand for household goods because this is not a recovery it's these type of vehicles and auto parts that will feed that demand >> that's great. in terms of cash flow, what do you see here >> with really strong market share often you get very good, very strong ebitda of growth in these names. in particular for this what you want to see is good, strong recurring revenue which leads to the strong cash flows. this is particularly one of those names that fits that but there's other really good names, too, that we could ship to if you're good. willscott mobile mini is where you have strong, recurrent revenues these are companies with portable storage units you may say, how is this related to ransportation you have big population

movement, big construction, you transport goods at construction sites, you need these units and with leases of 2 1/2 years plus, very strong pricing with significant market share and highly fragmented industry, willscott is another great name to capitalize on this transport. >> we are out of time, katheryn. i apologize for that i know your third pick was atlas corporation given conta containerships it's good to see you this morning. thanks for your time >> thank you coming up, is your brackets busted jay snowden is going to join us to talk about how the opening weekend of march madness went

with the gambling stocks gaming companies we'll be back.

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futures lower as markets mark the one year anniversary since the pandemic bottom. what you need to watch in today's trading session is straight ahead. returning to the office. a new study from kpmg captures how ceo's of the nation's largest companies are looking at the opportunities and struggles driving their businesses. and penn national is dealing with barstool sports we're speaking to the ceo jay snowden about the rise of online sports betting and much more the second hour of "squawk box" begins right now ♪ ♪ good morning and welcome back

u.s. equity few tours are down about 116 points on the dow. you see the s&p also in the red and the nasdaq trading lower as well we had bond yields moderated once again i think we were at one point on the 10 year below 165. that's not helping necessarily because we have a pretty big selloff going on in oil. we should put oil back there see bitcoin is down just about 58,000 a couple of days ago. now 54,000 really volatile. there's crude, down 4% germany extending the lockup all the way until mid april and concerns about variants. concerns about resurgent violence the upward momentum in rates troublesome for the markets.

that has moderated but it's not helping today because now we're worried about the flip side, and that is that lockdowns could continue, reopenings could slow down seeing even on the east coast here the mayor is arguing with the governor about no more reopening. if you were thinking about going further, i think they went from 30 to 50% occupancy. >> occupancy. >> yeah. you know, it is odd that now we were worried about such a rip roaring economy, now we're back to worrying about maybe not opening up as quickly as we had hoped. nkts obviously just a pause at least in the reflation opening trade. we'll see if it's anything more than that. everybody got positioned for the economic acceleration. that's why i think the market had a chance to give back in the friction in the reopening story

and plateauing of caseloads. >> it's some anniversary today of the low. >> it's the anniversary, exactly. >> was that ackman day >> no, that was a few days earlier. >> he said, we're going to hell as we were buying. >> he said on the interviews all his stocks would be up ultimately it was a few days earlier. it was several days of really unhinged liquidation in the markets that cull my mated in that march 23rd low. the market ended up 3, 4, 5% low. it was a big interday rally. gave a little bit of hope. we didn't even get anything close to a reset to that low either a lot of folks usually look for something like that. >> mike, we look at this chart up 76%, but how big was the drop because it was a pretty steep drop >> 34% was the drop. you it took a few months to get

back to the pre-covid highs but we've obviously gone well above those now. it's the best year that we've seen since the 1930s best 12-month period i would say. meantime, here is what is making headlines at this hour a day after upbeat study results, astrazeneca is talking about the study. they were told astrazeneca may have outdated information. meantime, travel industry groups are urging the white house to drop a plan to open international borders. they want the plans finalized by may 1st so international travel can resume travel within the u.s. has picked up considerably in the last week or two a new study on the code of

tiktok does not pose a security threat government officials in multiple countries have suggested that tiktok could be used for spying purposes by china. thanks, mike in the meantime, fed chairman jay powell and treasury secretary janet yellen will be testifying before the house financial services committee steve liesman joins us with some of the expectations of what we might be hearing hey, steve >> hey, becky. jay powell, the current fed chair and janet yellen, the former fed chair, will appear together for the first time and will strike similar tones. powell will tell congress that the recovery is far from complete and the fed will provide support for, quote, as long as it takes he's going to offer hopeful notes. he's going to hope for a return for more normal. unemployment has turned up recently and i quote here from the fed chair, the recovery has

progressed more quickly than generally expected this is due in significant part to unprecedented fiscal and monetary policy actions. no hint he's ready to dial back on zero interest rates or reduce the fed's assets the words inflation, debt and security all three could be the focus of questioning. yellen will note the improvement but the long road back she says we are meeting at a hopeful moment for the economy but still a daunting one while we're seeing signs of economy, we should be clear eyed about the hole we're digging out of yellen goes on to say she believes the u.s. may see a return to full employment next year and praises fiscal policy as well. this is a moment when both the treasury and the fed have similar interests in boosting an

ailing economy next year the objectives of these former colleagues may not align so closely, becky. >> steve, i think you nailed it. the three words don't appear in jay powell's opening comments. inflation, debt, deficit those will certainly be issues congress points to >> i think so, becky i'm not quite sure how strong the i want to say opposition but the other side of the policy debate is right now. powell has so far -- i mean, he gave a republican congress and president kind of what they wanted and pretty much with the democrats. not really much of a hankering right now on congress to take away the punch bowl. i think there's some concern right now the idea of 9 million people still being down in terms of unemployment, people dropping out of the work force, i think the idea of continued stimulus still has the majority support

in congress. >> yes he gave the republicans what they wanted, which was low rates when they were in charge continuing to do it today and you can obviously point to that unemployment rate as a big reason for why he wouldn't take it away just yet but there are going to be questions that start to be raised at least in some circles, especially as spending packages keep coming looking at another $3 trillion for infrastructure >> i think that sounds like an awful lot of money and i was -- you know, i guess my own personal opinion was you could kind of sort of maybe make some sense of the first one nine but to come down and do another three trillion is to embrace an idea there is no limit on what the government can spend call me skeptical. >> steve, thank you. it's good to see you by the way, coming up at the top of the hour dow's fed chairman

robert kaplan is coming up. >> they need to be careful with those words. in the past what was the one -- there was one word that could change and the market was like -- whew was it temporary or -- your mike's not on, mike. i don't know, what was it? >> patience or trans itorytrans. >> if you don't say transitory if you mention debt, deficit, inflation, the whole thing could blow up. >> true. coming up, microsoft giving roughly 57,000 employees in the redmond and seattle areas the option to return to the office the latest attempt to get employees back to the office results muof a survey when you return to the office the markets, red across e th board. got a long session ahead of us

"squawk box" will be right back.

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get started today. goldman sachs ceo david solomon addressed the employees problems younger employees were

complaining about the long hours. he would strengthen the enforcement of saturday rule they are not expected to be in the office from friday night to sunday morning in the months ahead there are times when we're going to feel more stretched than others, just remember if we go the extra mile for our client, it will make a difference in our performance. >> mike, thank you what will work look like post pandemic kpmg conducted a survey. they were asked about a number of different topics including thoughts on getting back to work post covid joining us is paul knot. he is the u.s. chair and ceo at kpmg paul, this is interesting. i heard surveys from employees these are from 140 ceos of large companies.

i think what amazed me most is only half of them think they will be back to work in some form of normal wri by the end of the year >> there is a lot of optimism did the vaccines and there is some hope we can get back to work i think the question is what does the normal look like going forward? it is going to involve a lot more flexibility when it comes to our employees returning to the office >> what are you watching right now? i said knopp i snow it's knopp. what are you trying to figure out? what are you telling people? what are you telling them when you reach out to say, what do you want >> it continues to be the says

of the safety of our employees is paramount so we have told our employees no one is required to return to work before july 1st and we're doing some staged pilot reopenings of some offices, small offices, checking protocols around health and safety and to assess how we can reopen it. we're looking at it and working effectively in the remote environments some employees do want to return to offices and be together we're looking at how we can make that happen. >> paul, almost 20% of the ceos surveyed said they think business has changed forever did they give you specific on how they think it's changed? >> i think the crisis, the pandemic, social justice crisis has really accelerated how ceos think about purpose, values,

culture, becky they're making meaningful investments in their esg strategies they're thinking about how they seamlessly interact with customers in the future. there's been an acceleration of thought and purpose and digital experiences. i believe ceos reflect on that it's a fork in the road moment for ceos, the pandemic and social justice crisis where we're all hitting the accelerate button to drive customer loyalty and growth, to attract and retain talent and to meet investor expectations. >> one of the big questions a lot of people i've spoken with is just around the logistics of trying to get people back into the office place and making people feel safe about that. you don't have a choice often. if you're expected in the office, you have to be there there are a lot of things you can't do which is force

employees to get a covid vaccine especially when it's approved under emergency use authorization. there are even questions whether you can ask employees if they've gotten a vaccine what did you hear? a large number of ceos are going to ask employees to let them know. >> 90% of ceos are going to ask employees to let them know we'll have to follow the guidelines and regulations part of making that request, we do want the workplace to be safe to the extent employees share that, we can measure how we'll make the workplace safe in the future and promote the well-being of employees. that's something that takes

sh shape. >> we've heard from a few ceos, it seems to be around 80% of employees say they would get vaccinated, 20% at a lot of workplaces say they would not. does that hold true from what you've heard from other ceos >> i don't know we know metrics around how many employees will not be vaccinated. the stance we take at kpmg, we are going to encourage our employees to be vaccinated and continue to respect their decisions. we certainly will encourage them strongly to be vaccinated. we think it's aligned to be together or better in the workplace. >> in terms of the economic and business outlook you're hearing from the ceos, it's been a long time since any of them felt like they had any visibility. what are they telling you now? >> becky, the ceos reported in

very strong numbers they're very comfortable about the growth prospects for their own companies as well as the u.s. economy. somewhat less confident about the global economy ceos are operating resilient models and are confident that the stimulus will seemingly help that environment they are expressing strong confidence in growth over the next three years >> the things that the ceos are concerned about, that's a constant topic where you ask them what they're worried about. what tops the list right now >> becky, certainly one of the themes that always rises to the top is sustaining workplace culture when you're working virtually. the other one that's really prominent is more diversity, equity and inclusion in the workplace. kpmg issued its own dei

transparency report. we're being transparent about the progress we make and need to make that is something that's going to drive accountability and progress on. those two topics come up very often. >> what about risk from regulators or from higher taxes? that's a topic we talk about frequently >> yes the two risks that rose to the top in this survey were regulatory risks and tax risks with potential additional new regulations. we know there have been certainly new proposals on tax laws those are two risks that rose to the top in this survey. >> want to thank you for your time it's good to see you. >> thank you, becky. >> paul knopp from kpmg. we want to tell you about an event coming up next week from

innovation acceleration, the reallocation of women and capital. the global pandemic has fundamentally disrupted work what's next in the company's information. you have to go to the cnbc app work summit on march 30th. hear from the most influential voices featuring actor and author matthew mcconaughey many more voices as well if you'd like to go, register at cnbc events.com/work >> all right coming up, global production of japanese automakers feeling the pinch from a worldwide chip shortage phil lebeau after the break. we head to the break, check out the shares of viacomcbs down 5% after they say they are going to raise 5 million in the stock

offering viacom cbs up $3 billion they're streaming services like the company's recently rebranded paramount plus new content to keep it up. "squawk box" will be right back.

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japanese automakers may now be facing a chip shortage. phil lebeau joins us now on this global problem >> reporter: mike, it really got bad over the weekend with a fire at a plant that supplies a good portion of the chips for the automakers in japan. up until this point, japanese auto production for the most part they have been spared the facts other automakers have had. that's changing following a fire at the rerenesas plant. that will take out production for a month. they have enough supply to meet shipments for the next month then it starts to get dicey.

66% of the chips made at that plant are for the automotive industry primarily for cars and trucks built in japan here in north america, toyota and honda are curbing their production they're going to target lower volume models and target the higher priced models nonetheless, the japanese auto stocks, they're all facing a tighter supply of vehicles this is not a good time for that to happen in the spring auto sales and then the summer. they are not seeing an acute shortage but it will be a tight supply ford is curbing production this week and it doesn't have the amount of chips that it was expecting to have. bottom line, expect this to

continue for the next several weeks or the next couple of months. >> phil, you say at this point there's enough supply on dealer lots how long can the industry go before we get pinched? what does it mean for the next model year and pricing what are the implications down the road >> i don't know if we'll get pinched and say we want a particular model and they'll say, we can't get it for you for the next several weeks there is a tighter supply. we are already at record transaction prices i think the average transaction price for a new vehicle, close to $40,000 the most popular vehicle is a full sized pickup truck. the average number is already at a record high of more than $51 tho $,000. thank you very much. >> you bet becky.

much more to come on "squawk box" this morning. we're going to be talking to penn national gaming jay snowden. tech investor dan niles with some thoughts about all of the money sloshing around out there. you'll want to hear this "squawk box" will be right back. hey, dad! hey, son! no dad, it's a video call. you got to move the phone in front of you like..like it's a mirror, dad. you know? alright, okay. how's that? is that how you hold a mirror? [ding]

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welcome back to "squawk box. i'm dominic chu with your minute market what's happening with growth stocks versus value stocks value stocks have been outperforming for the better part of six days one etf that tracks growth stocks versus value stocks, huge outperformance in value. it's starting to narrow just a little bit here in the last couple of days we'll see whether or not that continues on the current trend one of the big ones on the sector trend, wti crude prices, 59.28. the last trade off 3.5%. there are concerns european lockdowns are waiting for the covid pandemic are starting to

weigh a little bit more on demand germany will extend. crude prices are starting to weigh. the highs we've gotten keep an eye on that. that's translating into under performance and key parts of the market if you look at the oil and gas trade, look at exxon mobil and diamondback energy both have been under performing and then financials as well. pnc financial and silicon valley watch energy and financials. i'll send things back over to you. >> talk to you soon. >> coming up, the tuesday trade the year since the bottom during the pandemic we'll find out where you should be putting money to work then penn national gaming is adding to the s&p 500 yesterday. speak to ceo jay snowden about the coanmpy's success and areas of opportunity "squawk box" will be right back.

diane retired and opened that pottery studio. how did you come up with all these backstories? i got help from a pro. my financial professional explained to me all the ways nationwide can help protect

financial futures in peytonville. nationwide can help the greens get lifetime income because their son kyle is moving back home and could help set up a financial plan for mrs. garcia. and he explained how nationwide can help mr. paisley retire early and spend more time with his pal, peyton. and their new band. exactly! yeah. don't forget the band. i haven't. markets hit their pandemic low exactly one year ago ending the fastest bear market in history. the major indices have rebounded tremendously since then. the russell 2000 is up 125% and the nasdaq nearly doubling in

the last year. futures backing off a little bit. s&p up about .7 of a percent now down a little over a quarter of a percent joining us is james mcdonald great to see you thanks for being with us this morning. >> thank you. >> so the market obviously after this huge run, we've been a little bit range bound and caught in this rotational action, growth one day, value the next churning. what's your read on this do you see the possibility we have a little pay back >> it's incredible the boom market that started in march of 2009 got a little bit of a hiccup. the roar coming back is like nothing that's ever been seen before the energy behind the buying bull market is finding a place to go. we saw the nasdaq go up.

during that same period the russell 2000 took another two legs up. we're off 52 week highs on the dow. s&p 500, russell it meant the money went somewhere else we can call it a rotation or follow through of the bullish energy since the pandemic relief came we saw that the 90 days after the election the greatest rally in history i think the energy behind the bull market is continuing. it's finding a place to go we have to understand that the bullish sentiment will continue until something stops. that money is finding another place to go. >> does that mean that you feel the risk/reward in the market still is favorable in other words, don't over think it, this is a bull market until proven otherwise

>> it's hard i've been a bear for a long time bears are getting slaughtered. the trend is powerful. when we've used history as a guide we failed because this is an unprecedented situation where the federal government and monetary policy is on favor with the stock market we've seen unprecedented stimulus, support and liquidity. that's changed all of the rules. it is a market where you have to be cautious. there's been some volatility in areas that were safest, apple, am amazon we've seen pressure coming there. we do want to be cautious to the down side. we like volatility but monday theless, you do have to understand this energy in the bull market. we saw a divergence for the first time in 20 years we saw a 10% correction in the nasdaq but not in the dow, s&p

and russell. that means money is looking for a place to go. >> seems so. respect the market but with some hedges james, thanks a lot. >> thank you >> thanks, mike. one day after upbeat study results, u.s. health officials are expressing concerns about that study and data as it was released meg tirrell joins us on the squawk news line with more on the breaking news. alerts from anthony fauci saying they are not going to rely just on the company for the data, meg. >> reporter: becky, this is an unusual statement that came out overnight. they said that the data safety monitoring board, the independent oversight board that watches these clinical trials and assesses data for the company notified them late monday night, told them, barda,

u.s. government and astrazeneca it was concerned about information released by the clinical trial the board expressed concern that astrazeneca may have included outdated information from that trial which may have provided an incomplete view of the efficacy data the niad is saying they are encouraging the company to work with the board to ensure the most accurate and up to date data be made public as quickly as possible. they are not saying anything about the safety and they are not making clear what exactly was out of date in the press release from astrazeneca yesterday and those comments from dr. fauci are the process that we always see with the fda and why a lot of people have been encouraged by the u.s. system for reviewing these vaccines the fda gets all of the data

that the data safety monitoring board gets that's why it takes three weeks to review the applications, does the analyses and puts it down for the public to see. there's a head scratcher knowing that all of this information would be public when they go through the fda process. right now it's not clear what the outdated information was the reassuring part is it's not about the safety we don't know what about the efficacy was outdated. this is an unusual statement that they just had their product in the u.s. >> the stock is down 2.5%. fauci making comments a few moments ago. i'm not sure if you've seen it he said the astrazeneca data likely was good but the press release was not quite accurate that's a big deal considering

the trouble this company got back in november with the other data, the press release they put out, the earlier efficacy. >> yeah, it's been an unfortunate situation with the miscommunications. it's gone through all of the issues in europe where there are safety concerns, where it was paused for a bit, over concerns about blood clots and the european regulator cleared it for use. the communication is so tenuous and important because we're in a pandemic situation and these are our way out of it. people need to feel comfortable. it was not a good situation for the company to be in the fact dr. fauci is saying the data are good but the press release is not quite accurate, we're wondering what is that i was on a media call with

astrazeneca where they indicated they have had more severe events in the trial than they included in the interim update. the implication was it made the findings stronger of the 100% efficacy we don't know what the outdated information was. >> if it was safety after the blood clot, actually suspending some of the vaccines, that would be a much bigger deal as you pointed out, meg with the efficacy we were below 80 even the j&j with the second shot was up in the 90s, wasn't it this is two shots below 80 i don't know what they're saying whether the actual efficacy data would mean 79 was too optimistic fauci said it was still good that would be an issue, too, if it gets too much lower than

where it is compared on a relative basis. >> my understanding of reading this, i've never seen a statement like this before from the national institute of allergy or infectious diseases or any real body, we're in a pandemic situation and everyone is paying attention to these trials and the communications around them. i've never seen a body feel they needed to make a statement like this about statements that a company was making so it must have been serious enough for them to feel they needed to put this out publicly instead of communicating directly with the company. i've reached out to astrazeneca of course and waiting to hear back from them about what kind of statement they have about this i hope that because the niaid is publicly urging them to work with their oversight board on the trial that we'll hear more

from them soon on what this is >> meg, yesterday we had dr. scott gottleib on, the former head of the fda, to react to the news about the astrazeneca data. he pointed out he'd like to see the actual data himself because of the past discrepancies with the company but i think this is a really unfortunate situation given the concerns people have about the vaccines if the company has not been completely clear. obviously we want to hear more about what happened. dr. gottleib pointed out yesterday that this is more of a commercialization issue potentially than just a public health issue when you have vaccines here in the united states that are so effective, it means people at some point, probably by may, he thinks, will be able to shop around for have i vaccine they get. the rest of the world is relying on vaccines coming out he thinks at least when it comes

to the united states you could be looking at commercialization question where people say which one do i want to get at that point? >> reporter: yeah, the timing for astrazeneca is they likely wouldn't be getting on the market until early may by that point we'll be entering where we have enough vaccines for all-american adults by the end of may it would be a difficult time for any vaccine to gain a foothold globally it is still very much a public health situation. this is the vaccine that is supposed to, you know, really protect the world. they're planning to make 3 billion doses. they're doing this at a nonprofit. it's storable in the refr refri refrigerator this is very important to oxford that this be a globally accessible vaccine it is being rolled out in many lower and middle income countries. concerns about the disclosures, it just adds to sort of the

fuzzy picture around the vaccine. it's unfortunate it seems like a communication pro problem. it doesn't seem like a major problem with the vaccine. >> meg, if you call up and get an appointment, what am i getting? they go, well, we've got the astrazeneca, i guarantee you, some people would be like you don't have the j&j, pfizer, moderna? if you called up now, i got an appointment. which one have you got the astrazeneca. i'd be disappointed. i'd rather have a 95 than a 70. >> there's a statement coming out from astrazeneca i haven't even read through this let me read it as i'm reading it this is their update following statements by the niaid on the astrazeneca phase 3 trial data they say they reviewed the preliminary assessment of

primary analysis and results and they were consistent with the interim analysis they are completing the validation of statistical analysis they're completing validation of this they will engage with the independent data safety monitoring board to share with the most up to date efficacy data basically they intend to issue results of the primary analysis within 48 hours. the numbers published yesterday were based on prespecified with a data cutoff of february 17th maybe that's what's at issue that sounds like the same thing that happened last time around they say the interim date for cut offwas february 17th that's where questions come from. >> i would like to ask a

clinical trial expert about this that seems like a long time ago. they would have presented data accurate more than a month ago yeah, the results were accurate as of february 17th. they're completing for what came after that so they say now they plan to issue the results within two days we'll see what the are you dated results show and why the data safety monitoring board felt strongly enough about this that they and niaid felt they had to make a public statement. it's a very strong thing to do considering the nervousness around this vaccine and the importance of communications around them. so i'm very interested to see

what this updated analysis shows. >> meg, thank you. i'm sure we'll hear back from you a little later this morning, if not on "squawk box" but later in the morning we'll continue to watch the stock as well. astrazeneca shares down 2.4%. coming up, penn gaming and their deal with bar stool sports proving to be a good bet yesterday was the first day of trading since being deadd to the s&p. we'll speak to jay snowden after the break. "squawk box" coming back

so jeff, you need all those screens streaming over your xfinity xfi... for your meeting?

uhh yes. and your lucky jersey? oh, yeah. lauren, a cooler? it's hot. it's march. and jay, what's with all your screens? just checking in with my team... of colleagues. so you're all streaming on every device in the house, what?!! that was a foul. it's march... ...and you're definitely not watching basketball. no, no. i'm definitely not watching basketball. right... ( horn blaring )

27 million americans expected to bet on ncaa games. one company reaping the benefits is penn national jay snowden joins us now with an update on the events of the past week i hope your fortunes at penn don't correlate with my fortunes in the tournament. i would say most people's, probably, jay? are people still having fun losing their collective butts? >> i think there's a difference between the office bracket where we have been destroyed versus betting on the games itself. you have people on both sides of the wagers, people betting underdogs. it's been craziness and madness this year, as you know, joe.

upsets everywhere. kansas blown out by usc. every time you turn around there's another upset. >> incredible. i've learned a few things. i've learned the pac-12 can hang with the big ten i got big tenned out i was in love with all these big ten. it's like michigan is that the only one that's left, i think? and also the big east obviously. but that's neither here nor there. so that doesn't matter for penn. what type of year over year are you seeing comps based on this -- well, year over year is not going to work because there was no march madness. >> that's right. i can give you comps against super bowl which i think is relevant, joe, and speaks to how much excitement and energy around march madness we almost surpassed the handle, all of the wagers placed on the super bowl in pennsylvania and michigan which are two states we

were live in on the first day of march madness. by the second day of march madness we blew past, almost double what we saw for super bowl within the first two days of march madness people are having fun betting both sides, overs and unders our partners at barstool if you lose it by 1 point you still win the bet. people were having a lot of fun. we have a really unique strategy here with our partners at bar stool and they know how to engage their audiencein a grea way. >> a great partnership, as you say. obviously he's such an asset, portnoy. be honest with me, jay do you ever look at any of his tweets or the videos he shares and just go, you know, we're an s&p 500 company, dave. do you ever just worry this guy's just going to blow up?

he's insane at times, right? >> yeah. >> anything goes you don't ever say, dave, you know, remember we have a reputation here? >> listen, we went into this partnership eyes wide open i've been around the barstool brand for years. you have to get to know dave i know dave. dave is so thoughtful, so smart and he knows what he's doing do i agree with every tweet he's ever sent? no i don't think he agrees with every tweet he's ever sent looking in the past. he's a great partner they have delivered on everything that we expected of them i think we've delivered on everything they've expected of us and the partnership couldn't be in a better place dave's my guy. >> and will continue to do so. i sort of -- there's a time i'm a little bit envious i think he might be too big to have to worry about the things that all of us sort of little

people worry about in terms of -- he's just beyond that. probably has too much money to ever worry about anything again either what's the next big state for you? online -- i would like to be able -- now i'm hearing -- i go to vacation in georgia a lot i'm hearing georgia which would make it more fun for me down there if i could be interested in sports while i'm down there, huh? >> yeah. we're now live in three states, pennsylvania, michigan, we just launched in illinois before march madness. it's been bonkers. that's where big cat is from from barstool. to your point, there's a lot of states in the cue. we're going to be live in indiana hopefully by the end of april. live in new jersey which will make it easier for you to bet with us. probably by the end of may another slew of three or four states by the start of football season those are the states that have already legalized past

legislation. there's a number of states like georgia, ohio, massachusetts, maine that are currently contemplating -- kansas that are currently contemplating legalizing sports betting. there's a lot of momentum in the space right now. >> how many cylinders? what is penn is it a v-8? is it a v-12 how many are going and a couple of them are -- i mean, obviously casinos are still a little bit tough but improving? >> yeah. improving a lot. i think what we're seeing in the business is revenues and volumes that i haven't seen in years the month of march has been incredible so as vaccines are being distributed, remember, when we first reopened our properties at late spring, early summer and last year 2020 after the closures we saw a really high spend per visit when people came, but their visitation was way down year over year because those that were 60 plus years old weren't coming back. what we're seeing now is the

spend per visit is still much higher precovid but visitation levels look a lot like 2019. you have those two things working together like i said, we have one of the biggest weekends this plast r last weekend that we've seen in years. >> jay, thank you for your time. we're going to kick off that hour right now we have to say good-bye. we'll see you again soon good luck. i don't know, i think sister jean's got the right idea. sister jean. she's got a direct line. she's got a direct line. >> she does. it's working, joe. sorry about your alma mater. rutgers, they had that game won and they played not to lose. sorry, becky >> that's all right. they played well and we are proud. good to see you. thank you very much. in fact, it is 8 a.m. on the east coast and we are getting some news about astrazeneca's covid-19 vaccine if you want to check out the shares of astrazeneca, they've been lower this morning after an

independent monitoring board told u.s. officials the drug maker may have given incomplete efficacy data. moments ago astrazeneca came out with its own statement saying it will engage with the data safety monitoring board to share analysis of the vaccine study. it will have the results and be analyzed within the next 48 hours. we heard from dr. anthony fauci who told abc news the fda will independently review data and not rely on the company. he said the data really are quite good but he blames some inaccuracies in astrazeneca's press release when the company reported that its vaccine was 79% effective in that u.s. trial. some more that we can glean from this in just reading through the release is they say data -- the numbers published yesterday were based on prespecified interim analysis with the data cutoff of february 17th. maybe it's the data from february 17th to now that they are raising some questions

about. again, that stock is off by 2 1/4% it raises questions not only when astrazeneca will be cleared for use in the united states but also questions about whether people would feel comfortable with that given some of the questions we've already had around vaccines in general and with the astrazeneca vaccine in particular some of the questions in europe after that drug was pulled or after the vaccine was pulled in several countries because of concerns about blood clots data from the u.s. trial showed no more additional concerns about blood clots and said blood clots were not out of the ordinary and what you would have anticipated to see we'll hear more from the regulator and the company as we continue to watch the stock. investors will be paying very close attention to washington today as well fed chair jay pole and treasury secretary janet yellen kicking off two days of testimony from congress focused on the economic recovery from covid-19 that's what we're going to talk about right now.

steve liesman joins us with a special guest. steve? >> good morning. joining us from dallas, the dallas fed president robert kaplan president kaplan, thanks for joining us this morning. >> good to see you, steve. >> i want to start off right where the -- at the heart of the market's concerns here i want to know if you share the inflation concerns that have been expressed by some in the market we notice that chair powell doesn't mention the word inflation in his testimony today. does that mean it's not a concern? >> i think we're wise to pay attention to those concerns and be vigilant about them having said that, my own base case is that we'll see a surge in prices this year. a lot of that will be due to supply outages related to covid, supply/demand issues, other issues metals, semiconductors, wood products and so on but i do believe that a lot of

those supply demand issues will get worked out over the next year and that's what i'm hearing from companies in those industries and i still believe technology, technology enabled disruption is a powerful force so that inflation in 2022 will settle down a bit and we'll still be running at or a little bit above 2% now having said that, theis a forecast it's a base case and i think we're wise at the fed and i intend to be very vigilant about it and be watching this very, very carefully >> how high might it go? inflation, that is >> well, for this year, i'm thinking that year over year inflation this year will be 2 1/4 to 2 1/2%. that's comparing this year to last year and last year the base of sets were such we had very low inflation. i'm not looking for higher than

2 1/4, 2 1/2 if i saw something more than that, my first question would be what's the cause of it is it something that's transitory, short term or something more persistent? but right now i'm still of the view that as we get beyond this year inflation, just to remind your viewers, is not a one-time price surge. it's year after year price increases and i'm -- i think the jury's very much out as to whether we're going to see that. it's not my base case. >> turn to policy, which remains unchanged. i've been sort of perplexed as to how the economic facts have changed but the policy has not there was an unexpected win by the democrats in november, i guess it was actually early january when the democrats took the senate now there's a $1.9 trillion stimulus bill that was not frankly expected by a lot on

wall street or even others who follow the economy and yet fed policy is unchanged despite this massive fiscal package. how do you justify keeping in place the massive $120 billion of stimulus, zero interest rates when you have this massive fiscal package >> so the forecast, as you mentioned, has improved. my forecast has improved meaningfully i'm expecting 6.5% growth. i'm expecting the unemployment rate to approach 4% by the end of this year having said that, we're still in the middle of the pandemic and i want to see more than a forecast i want to see actual evidence that that forecast is going to unfold as we do and as we make substantial further progress in meeting our dual mandate goals, i for one am going to be an advocate for beginning the process of removing extraordinary monetary measures

and doing it sooner rather than later but i need to see outcomes, not just a strong forecast >> thanks, steve i'm going to ask one of your questions because you said it earlier, even you are -- the 3 trillion for real -- it starts adding up after a while. steve made the point that the fed and fiscal authorities are really in sync and they have each other's back and they're moving -- and it's weird because you've got former fed chair yellen is now, you know, sort of promoting some of the fiscal policies we haven't seen that before. so we did 1.9 trillion if we do 3 trillion additional, are you just fine with that at this point is it like go for it we have 9 million people that don't have jobs, let's do what you've got to do, guys, and we've got your back? is that where you are?

>> well, there's a few phases of this while we're in the midst of the pandemic we're not out of it yet. having said that, we do move out of this pandemic and move beyond it, i think monetary policy needs to adapt to the aggressive fiscal policy and our forecasts reflect that aggressive fiscal policy, at least the 1.9 trillion and mine certainly does. and while there's a median dot which steve was referring to the in the s&p, some of us, i'm not at the median, i have a forecast for moving accommodation that's more aggressive than the median and i think monetary policy should react to that and i -- so that's what i'd say about that >> steve, do you want to drill down more on this? >> yeah. i mean, i think you and i would both have the same follow-up

here president kaplan, i know this sounds weird, but where's your dot? are you a 2022 guy in terms of raising rates? >> there were some dots starting increases in 2022 and, you know, i'm -- i'm at one of those dots, yes. >> fascinating and let me ask you about removing accommodation i'm sorry if you wanted to follow up. >> no. i feel like i stole your stuff already. but when i get you to say 3 trillion -- 3 trillion, it's -- 3 trillion that sounds -- after 1.9, we're like desensitized, president kaplan i think you need to talk to your colleagues and you've still got a relationship with chair yellen, secretary yellen >> so we'll have to work our way through '21, '22 and '23 i think that it's worth remembering we're still in the

midst of the pandemic right now and we've still got to move beyond the pandemic and not take that for granted but, again, i would say as we do and as we meet the first test of substantial further progress towards our dual mandate goals, i'll be an advocate of removing some of this extraordinary accommodation, starting with bond purchases, we're just not there yet. it's an outcome-based test our tests for raising the fed funds rate years in the future is an outcomes based test. i'm going to be on my front hood watching how the economy unfolds and be prepared to act as the economy beats those benchmarks. >> might that be this year, president cap kaplan. >> i'm going to stay away, steve, as you know, from calendar estimates our benchmarks are not calendar

based, they're outcome based i'm not going to prejudge when we're going to make substantial further progress, but as i see that test being met in my own mind, i'll be arguing for taking action i don't want to predict exactly when in the calendar that will be because truth is, i don't know >> let me turn to another aspect of fed policy which is whether the fed ought to come in and play a role in suppressing the yields on the long end of the -- in the bond market are you an advocate of that? is that something the fed should do did the fed somehow give the markets the idea that that's what it would do at a certain level? is that a mistake the fed can do in communication >> it would not be something i would support unless there's some extraordinary circumstances. i would not be an advocate of using monetary policies to do

more to distort the pricing of the treasury curve i would not do that. there might be circumstances that i would be open minded to, but my baseline view is i would not do that. i would just also emphasize, i've been one that's been saying for most of this year i would expect the 10-year to back up further from here, and that means 1 3/4, 2%. in february of 2020 the 10-year treasury was 1 3/4 to 2% i don't see why as we recover that the 10-year rate won't back up further i think that will be a healthy signal, not an alarming signal, but a healthy signal and not one that i would be an advocate of getting in the way of. >> president kaplan, there's been a lot of speculation about politics and how that plays with

the fed. i know the fed is seen as an independent body and i'm sure that's how you all see yourselves i read story after story and hear comment after comment about how jay powell is going to have to be very careful to make sure he doesn't do anything to upset the biden administration before his term expires if he wants to see a second term. it implies he'll have to get along with janet yellen and make sure he keeps rates low. is that a conversation that ever takes place either in the room or the back halls between any of the fed members? >> no, and so i work very closely and talk regularly with jay powell and i talk regularly with my colleagues i have not seen any evidence whatsoever of any political considerations or political influence influencing the chair or the members of the fmoc around the table our whole focus has been achieving our dual mandate and

during this crisis trying to make sure the economy weathers this crisis, but i don't see any evidence of that, and i think your people watching this should have confidence that we're making decisions devoid of political influence or political considerations i don't see any evidence of it in my daily dealings >> president cap lain, i have two last questions but i think i'm only going to get in one so maybe late jeer we can talk about whether you recovered from the hazing process you got at goldman when you first started there. but let me ask you the final question here, which is that being in front -- in texas there, the fed has been sort of outspoken in arguing for the kind of restrictions and mask mandates and things like that that would get the -- would suppress the virus how do you feel about what's happened in texas and the complete opening of the state by the governor >> so i'll stay away from the

political aspects of state decisions but i will tell you the businesses in this state by and large have kept their mask restrictions why have they done that? because they want to do more business to the extent their customers, particularly in restaurants and other person-to-person contact industries, to the extent they keep their mask restrictions, people are more willing to frequent their businesses. that's true of person-to-person contact industries broadly, true of airlines. i hear that regularly and across the board from businesses. so while the state has made certain decisions, i've seen by and large businesses have kept their mask restrictions because they think it's good for business and they want to do more business and they want more mobility engagement and people coming to their establishment. >> president cap lain, thank you so much for joining us today and i hope we'll see you here again

soon. >> see you soon steve, thank you. >> mike, back to you we a pppear to have uncovered o of the hawks here. >> yes, we have. we've identified a dot. coming up meanwhile, thank you, steve, we will speak to the co-founder of drug maker regeneron. he'll give us positive data on the antibodyocai cktl. stay tuned you're watching "squawk box" on cnbc

major activists have joined the party. they've found other ways to profit from the boom. we'll lay out all of the avenues for u enyowh "squawk box" returns

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welcome back, everybody. the recent surge in spacs has created a preceding ground for shareholder activists. leslie picker's been looking at this hi, leslie. >> reporter: hey, becky. hedge fund activists are no stranger to the spac market. they've raised spacs of their own and with the help with spac merger financing, the next

opportunity experts say are to capitalize on the spac boom. here's the playbook. when a spac takes a company public it will include financial projections. traditional ipos rarely do this because they have greater liability risks if those projections go awry. in other words, they lack safe harbor spacs because they involve a merger and not an ipo, financial projections can be a key attribute because they have greater protection in this latest round of spacs, they're nascent businesses any missteps, you can bet activists will pounce and look to shuffle management and the board. we spoke with ethan clingsburg he is at the law firm fresh fields he's already advising clients if and when they sell to a spac, to restructure their companies in a

way that would defend them against potential activist attention including creating a second asset of stock and boards to stagger when directors are up for election becky. >> leslie, i'm trying to figure out the timing on this on how quickly some of these would be fair game i guess once the spac does the merger and it's been trading on the public markets, it would have to be after you see a drop down in the price before the activists come in. they're not going to buy a stake until it's trading they're going to wait until it falls and jump in? >> reporter: that's right. the bulk of this activist activity could still be years away because most of the capital that's been raised through spacs has yet to actually find a merger partner that's step one. then they have to start trading, have quarterly earnings and miss projections that they laid out we're talking about something down the road in the future but

it is notable that already it's something that these companies and their advisers are starting to think about just given the potential vul nerabilities of laying those projections out there and failing to meet them down the road. >> we're going to be talking about this, i get a feeling, leslie stay with us we are going to be talking about it right now let's talk more about who's profiting from the spac trend and whether or not we've already seen peak specific joining us is dan primeman he's with axios. you already have the consumer federation of america wants the house financial services committee to eliminate the safe harbor protection for these spacs. at least someone would be liable for just out and out bs that might help make these things popular, viable. >> yeah. if they get rid of the safe

harbor that puts spacs on the same level as ipos are i don't know that you'd have people making fake projections, they just wouldn't be able to make the projections anymore if you look at a lot of the companies being bought by spacs, ev companies, air taxi companies that haven't commercialized yet, it would make them harder to get that >> how much wiggle room is there? isn't that a reflection of just the froth we might be witnessing here that will sooner or later burn investors >> the froth is in capitals being raised less than deals getting done there's $175 billion of spacs and that's preleverage that's in terms of spac capital. 10 more spacs priced last night.

there is a question that there's a saturation point in the number of spacs out there in terms of the ones done, a bunch of them pre-merger aren't trading all that well. they've broken their $10 price there's a lot of specious ones there. for the specious ones, they're being backed by fidelity, t. row, the so-called smart money >> do you think we're going to see more dual class structure? i mean, that's an answer to some extent, isn't it >> it's an answer to ward off the activists that leslie was talking about. i would say though, maybe i'm just being kind of naive about this i would think if i'm a perspective investor looking at one of these nascent companies, precommercialization, not a biotech, tech company, precommercialization, already questionable you're doing it via spac now putting in a dual class structure, that might give me a little bit more pause.

>> leslie, it's interesting the idea activists might start targeting an area where you have over inflated projections. usually they see some kind of hidden value, some business that can be operated better or done by way of a transaction to surface that value i wonder if it's not more conducive to short sellers saying these are unresidential realistic, we're going to bet against it as opposed to trying to figure out what some of these deals in a regular, better managed way might be worth >> right that's a derivation of some of the activist activity we could see down the road. we've already seen the short seller activity which is a different way of going about this type of criticism that's hit the spac market pretty much in droves so far we've seen several high profile spacs be targeted from this from clover health, multi-plan have been targeted by short sellers who say there's been a tremendous runup

we don't buy what these former spacs, now despacs are selling and we're short and we're going to tell you why we're short. that's driven the stock prices down it's kind of the early stage of what some people are saying are cracks that are starting to form, some criticism starting to form for the mergers that have taken place. >> hard to put you in a position to be calling it a top, but no one rings a bell obviously what would be a sign that this is just out of control at this point? just in terms of the spac universe how could you tell >> joe, as you agree, i'm not going to call a top. three months ago i would have said, yup, we're at the top. i'm not going to call it now if we see a bunch of spacs that raise ipos, a significant number of them that start trading under their offering price if you're a spac sponsor or potential one and you start

seeing a ton of these, maybe you don't do it. remember, most of these spac sponsors aren't in the so-called spac business. they've gotten day jobs. they're only going to do this if they view it as a lucrative thing to do. >> spac sponsor. we can't do it with that because -- >> no, you can't. >> spac sponsor is still a sponsor. >> it is the spacopolous. >> i'm going to try to make one with your name in axios. dan, got one >> spacxios. we'll have it out in a couple of days. >> that is good. dan, thanks. leslie, thank you. are you still there? anyway, if you're not -- >> i'm still here. >> see you, leslie. coming up, dan niles talks tech and the biggest nagging question for the stocks in that

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>> meg, first of all, it's great to be on with good news that could be big news. first of all, i think we have to point out that we're all hoping widespread vaccination will increase when we get this pandemic under control, but we can't forget about the people getting infected every day and at risk for progressing to severe disease, hospitalization and death. still 1 to 2 million people a month with tens of thousands a month dieing the vaccine is too late for these people with concerns about emerging variants which can undermine

vaccine efficacy and seeing secondary vaccines, we need a treatment for the people who are already getting infected for whom the vaccine is too late and that's what our study addressed. that's why i think our news is so important the largest phase three study of the time that tested the regeneron antibody cocktail. it reduces the risk of hospitalization and death by over 70% moreover, for the broader population, shorten the duration of symptoms for these patients and all at a lower dose. very important, just last week the fact sheet on all of the authorized antibody treatments says our is the only one retaining the variants altogether this is big news. for the people who are getting sick now, who have a high risk of progressing to hospitalization and death,

there's now a very effective treatment and just as importantly, by showing their own low dose works, we now have the supply chain to treat almost all of the high-risk patients who need it every month. this is really big news. this can make a big difference for all of the people who are still getting infected and still at a risk for hospitalization and death. >> but it will only make a difference if those patients can get the drug and get it quickly enough after diagnosis how has the situation changed in the last few months? we heard from the cdc director dr. rochelle walensky, in her experience at the mass. general it was too hard to get the antibody drugs at many people. they're good drugs but not a panacea. can that be improved >> i think the data announced is that they should be viewed as a panacea. we need to get great data that

would provide enormous mouse confidence the other thing undermining the confidence was concerns many of them were losing efficacy against the emerging variants. so i think getting compelling data to change the degree of confidence to point out that this is what we must be doing. this is what the standard of care should be and making it an imperative it really is a moral imperative. we now have the drug supply. a few months ago we did not have the drug supply. all of these things were undermining people's confidence and is this a useful approach. we now have the drug supply. we now have the data i think the data compellingly says every high risk affected patient should be getting the drug it's up to the mass. general frankly, up to all the doctors and the states and the government we have the drug, we have the data, we can be saving tens of thousands of people from hospitalization and death every month. as a society, we have to figure out how to make it work. >> from what you see out there in the world, are patients

getting access has it improved or is it still too difficult and systems need to be improved >> i don't think it's the difficult nature of it i think it's the moral imperative i think for the reasons that i said, the confidence wasn't there in the data, the confidence wasn't there in the drugs in terms of the variants people didn't feel, like we said, it's not a panacea it should be viewed as a panacea. it can reduce the risk of hospitalization and death in 75% in the highest risk patients this is something we have to change people's views. it starts with the people that you were just referring to people at the mass. general. people at hospitals country wide they have to realize if they have patients getting sick, they have to figure out it's not too hard to get people this drug.

>> mandate the federal populations. there are high infection rates and there is now a drug that's shown to have an impact over there. so it's a moral imperative it's up to the data. they have to change their practices. if they don't they are doing a disservice. >> it's fascinating the fda looks at the monoclonal antibodies there is one here in new york, b. 1526. no change for your anti body cocktail for any of these.

the one in most concern. which of the variants are you most concerned about overall in terms of how they would do it. starting to take over now in new york we're going to need a treatment that's effective we have that in the most concerning variants. it will still be effective against the mutations that we

projected that are in these variants >> we hope you'll come back and update us on whether you see progress >> thanks again. >> thanks, meg >> joe, back to you. >> thank you, meg. the squawk change. >> so, jim. >> reports after the closure

their own rules. obviously they've gotten their own sec. i am shocked that someone resigns today in the morning and they report tonight but the people who like gamestop will probably love it even more because it's so unorthodox the omni channel, which is what they're going to need, right maybe he wasn't what ryan cohen thinks didn't measure up. >> i think that ryan cohen's going to hold to a standard. there is the ceo, right, sherman? >> yeah. >> he's got to be playing some role, don't you think, the ceo >> yeah. i just don't know, can customer loyalty and all these sort of, you know, on the margin, can

these things turn it into a $500 stock or a $30 billion company that's the whole question. >> i've offered ryan cohen they raise money they don't even need to raise money. if they go and become the bitcoin -- the -- listen, the crypto place where we know we can buy aethereum chips, which is the aethereum cards which nvidia has, we can play video games against each other they take over the end of the mall that is empty and they do egaming and it's the winners get crypto, then ryan should hire me as the chief -- new opening, chief customer officer and maybe you can do some activism for some spacs you're not part of. >> that's right. absolutely i'm after cciv 5 for mental

health. >> spactivism. >> no, we don't want you to. >> no, i don't >> never mind. anyway, thanks, jim. >> they should work as hard as they do at goldman, then they can get to $400 billion of valuation. >> we will see you in a couple of minutes coming up, noted investor dan knopp going to join us can we officially say it's over its ofcifial hiccup? don't go anywhere, "squawk box" will be right back

we see breakthrough medicines getting to patients in record time. at emerson, our automation software is empowering pharmaceutical companies to accelerate their production of critical vaccinations for the world. emerson. consider it solved.

. the coronavirus induced market bottom took place one year ago today since then the nasdaq has doubled. we've seen investors pour into high flying bond names but a recent out ol soft biggest players when it comes to technology dan niles, founder and portfolio manager of the is a tory fund. looking at this, do you think this hot hand for technology can continue or do you think that is about it zpli think off the start with

valuations number 1. you have had a lot of stimulus, obviously both government and fed coming into the market and that's driven the market cap to gdp of the entire stock market to about 1.8 times with that perspective. during the tech bubble peak, that ratio was at 1.4 times. and the average the last 50 years is actually 0.8. so valuations are high across the entire market and in tech in particular they are extremely high i think as you look at last year the pandemic helped a lot of tech stocks because people were stuck at home. buying things online streaming videos online. doing zoom calls etc. and interest rates were low. bottomed at 0.5% this years both of those are working against tech as we go start to go and go places.

>> you do have one top tech pick, oracle why do you like that name given what you just laid out. >> with oracle it is wlm the exact opposite of the tech names people like. they haven't grown revenue in three years. the multiple is very low about 14 times or. so they have a dividend yield above the market but the thing that is interesting about ork sl you potentially have revenue growth this year for the first time in three years. because the cloud business with the autonomous database business is about a billion and a half in revenues and growing every year. and that is going to be really

good for the multiple of that company. so think microsoft back when satya nadal took over a while ago. so that is kind of where you are with that. and we like google on facebook as reopening plays those are the other two in that space. >> when you say wed like it because it's got something that nobody else has. >> revenue that hasn't gone anywhere hasn't advanced in three years but you must have lot of faith this is going year that happens right? >> exactly and i think that is the key. it's really been a three-horse race in the space. amazon, number 1 and then google and microsoft. and microsoft, nobody considered them a contender and then they got there. went from being thought of as a legacy pc-related vendor many years ago and they made that transition to the cloud. for us those are the types of names and technology that we're interested in. we own some of the other legacy names as well.

we own cisco we think they are going to benefit as gdp growth picks up we all go pack to the office and then you have to start spending again on premise we own erickson as well. because we just went through a $90 billion spectrum auction almost double the expense people thought going in and now we have to start building out that spectrum so these aren't sexy names that have, you know, artificial intelligence or solar or, you know, biotech ore space rockets in the name. these are more legacy-type vendors but that should benefit if you really do believe the economies are going to open up and we get gdp growth at 7% or so this year which will be the fastest since 1984 oar with the facebook where you have got facebook shops, where you have 250 million users and advertising picks up as the economy picks up for google, 10-15% of their revenue is from travel, vacation, leisure, airlines that should pick up.

those are the types of things that we're interested in not stuff that's got earnings 20 years in the future that you have to count on bringing that back today at very low discount rate and with interest rates going occupy that's a problem that is kind of where we're focused. that is where we're having the best start to our history in 17 years and we've got some of these stats written up in terms of why we like what we like on danniles.com for people who want more detail. >> just wondering about the argument you might get an a oracle or a cisco. if the stock is still looking so cheap, 14, 15 times forward earnings in a markets that's repriced everything higher is that not a warning sign >> did they benefit last year from what happened did they benefit from streaming, etc. cisco is more on premise nobody is going into the office. we're all stuck at home. that is going to benefit

companies like zoom who were all going on video or companies like apple where you are having to buy an iphone or a mac, which i think i bought a mac and ipad etc. for my kids back from college and they are taking online. so off the think about which companies benefitted and then which ones actually got hurt and and if you really believe that we're all going to get vaccinated effort etc. and economies are going to open up that is where you want to be focused more this year last year you saw the benefits to a certain group this year you should see the benefits from the tech and things opening up and that is how i think about this position. last year my top 5 were all in tech this year only one is in tech and that is oracle the other four which are outside of tech. they are in banking. they are in energy, etc. and you guys had me on december 29th talking about my top picks of why i like the reopening stuff and the inflation plays.

and that is the way i'm still thinking about it. at the end of the day the vaccine still continues and i think we're going to get -- >> dan, i think we're almost out of time but i do want to ask you. your point about valuations is a very good one. these are very rich prices however you have also been looking at the money supply. and that's kind of phenomenal when you realize how much money is out there sloshing around how do you fight that? what is it, 26% increase >> yes, exactly, baek becky. that is the thing people have to remember i kind of believe we're going to get to a new awe thyme high. 30% gdp as stimulus. between 1.9 trillion, the fed buying bonds and money supply already up 26% year over year. the fed balance sheet is up 65%

year over year and those interest two things you are balancing, which is all of this money making things looks great. driving markets up they were up last year in the middle of the pandemic at the same time you have inflation building in the background i think the fed will taper before year end. i think that's going to cause problems and i think we saw the beginning with of that with the fed not extending the slr last friday we'll see how they balance out domonic choo jou joins us.i.

-- as part of that joint venture with warner. those shares recovering. now roughly flat in the pre market viacom and cvs down. the mead conglomerate between cbs and showtime and nickelodeon among others announced going to raise 3 billion in new capital two billion in a secondary stock offering a billion in convertible stock viacom cbs is going the use the money for general purposes like streaming and then we're going end here on streaming. netflix higher roughly a percent. analyst upgrade at research. they put a price tag of $650 they like the trends deadly weaponing there.veloping there. >> the check on the markets for tuesday. down about a hundred points on

the dow. the nasdaq has turned ordaroundd it's positive. that's difference than what we saw in the entire session. maybe that dan niles has some sway maybe although he wasn't that bullish necessarily on the nasdaq. we're going to do it again tomorrow. >> -- four tech names he owns. >> you going do it again tomorrow >> yeah they're going to let me come back. >> join u "squawk on the street" is next. good tuesday morning and welcome to "squawk on the street." i'm david faber along with jim "cramer. carl has the morning off one more time. the nasdaq looks to be right now the lone of the three that will be up at the open. let's get to our road map this morning. it does begin with the markets it is one year since the market bottomed futures as you saw are moving