with us. >> great to see you. >> that does it for us today, andrew, i'll see you back here tomorrow >> see you tomorrow. >> right now, it's time for "squawk on the street. good thursday morning, and welcome to "squawk on the street." i'm scott wapner with jim cramer at the new york stock exchange, david and carl have the morning off. and looking at the stocks, continuing the post-fed slide. not so bad the dow opened about 90, there is the s&p, nasdaq, following suit as well our road map starts with what else, the fed. about to shift gears inching closer to tapering, and investors are preparing for volatility ahead. plus, mr. chairman, microsoft backing ceo satya nadella in two decades and the tech giant, serving as board

chair. >> and lockheed martin ceo joins thus hour after one year at the helm an exclusive look at covid impact and the growth outlook ahead. well, well, well mr. cramer >> yeah. >> so the fed kind of surprised us you, earlier this morning, just a few moments ago, said you think that fed chairman jay powell is great, that he did a great job. >> yeah. >> you said you were on an island you felt like you were on an island. >>dy. >> i can tell you, you are not. >> i was in a single person, joining me in the idea that powell knew what he was doing. >> i spoke with jake tepper. >> smart guy. >> moments before we went on the air. he thinks the fed did a good job. that's what he told me that they showed they're not asleep at the wheel. and by the way, he said i think, this is a direct uote, i think the stock market is still fine for now. >> can i just explain to you who dave tepper is who taught me how to trade junk bonds, dave tepper is the only

one of the people who comes on air, actual ry running money, billions of dollars, and admits if he's wrong, but has been so far more right than wrong. he even predicted the pandemic down to the day. this guy is game. >> he thinks what he did was smart. that it's still a highly accommodative fed. >> then there you go. >> we're talking -- >> the banks, usually he has ideas. or the s&p >> we didn't go there. >> why not >> you want to talk s&p? he said i think the stock market is still fine, that sort of tells you what he thinks about the s&p i suppose for the time being. 2023 is when they will hike rates. what year is it now? 2021, right? so 2023 still a ways off still a very accommodative fed. >> he is saying what people should be saying accommodative fed. if things get really hot, we'll do something pragmatic guy. he's done a good job

one of the things that dave tep has liked about the fed chief is that he thinks he's smart and good and deserves the benefit of the doubt and tepper is no nonsense, he doesn't come on here with an ideological approach he is not about preserving his wealth he is about making money and i like that. he's the most, he is the most approachable billionaire in america today. >> he didn't think they would taper. >> no. >> they didn't he thinks they probably will later in the year and you know what, he also thinks if they do that, that it's good, it means the economy is in a really good spot that they've actually be able to - >> let's buy we should be buying. that's what is going to happen that will turn the futures around. >> i asked him the question once after he gave me the wrap. i said what do you think about playing christian mccaffrey this weekend, and i don't know what you are talking about, and he owns the panthers but when it comes to money, there was no better, when i was sick, when i

had the back problem, calling me, he was so giddy, let me tell you how i feel about the market. and this guy is different from all of the people who came on air in the last 24 hours who were talking about spots and dots which is of course, harvard, it is really where he basically said one thing when he says these things, ignore everyone else, because they're just speaking ideological, and go with tepper. >> you said yesterday at the top of "mad money," which i listened to, powell was being prudent, a word you used, investors should stay the course, buy stocks that would do well in a low rate environment. >> yes. >> and inflation hawks have no credibility. >> that's exactly it >> how did you get that? >> i tried to get tepper >> it just worked out. >> i tried to get tepor. >> sometimes you get him some sometimes you don't. >> he thinks i'm a loers he is not going to call some guy who is a loser that puts

everybody else on notice that the guy who is a trigger puller, who has billions of dollars, who would be quick to say powell is doing a bad job is giving him the green light and giving people at home the green light and that is the best yet that i've heard since 2:30, whenever they were heckling, mr. chairman, let me ask the same question for the 40th time if you don't mind >> let's not also act though that the fed didn't do anything, right? they did something that was a bit of a surprise to the market. >> which shouldn't have been a surprise i got the albertson's ceo, inflation, stimulus, too much stimulus for some, but powell acknowledged that. he's going to wait and see let's look at coming into the conference, in an 18-wheeler and says if we could get more drivers for the price, that inflation will go lower, no, he is a practical man and so is tepper and that tells me that people should be buying not selling. >> let's listen to the

albertson's ceo with you on this very topic >> we haven't seen the consumer yet affected by that level of inflation. i don't know where it's going to go over the next few months, jim, it could go a little bit higher, but again, we have a strong consumer. now, when it comes to us, you know, to the extent, if we ever get to a place where we are not able to pass through that inflation, we have an agenda to support it, to support anything we need to do on the pricing >> i mean you're going to hear more and more and more ceos tell you this. >> strong consumers. still buying flowers, nondiscretionary buying prime >> beef? >> yes >> what's the difference >> and what he's saying is, listen, we're pretty good, there's some inflation, it's not run-away inflation it's another tepper comment. he runs huge numbers of supermarkets he's not an ideologue

billionaire who comes on and is afraid that his money may be worth less because of the fed. he's a guy who runs a big chain and says we have some inflation, not run-away how many times have you heard the word run-away inflation. you know what they say run-away for? secretariat. >> let me ask you this what happens, because the fed is guessing like everybody else. >> humility. i'm doing my best. let's have some humility i'm humble. >> he said it could run hotter and be more persistent than we think. what happens if inflation starts to run too hot, at the same time that the job market isn't fully healed that's a bad case scenario for the market, right? you don't want to have powell's hands forced by inflation when he's so fixated and focused on the employment market, and there's a poignant moment, yesterday, too, when he was speaking and talking about unemployment, and the 7.5 million people, or 8 million people who are still out of work, and he said, we're not going to forget about you. it's everything you've said about the way he thinks about

jobs. >> african-americans and hispanics already discriminated against in this country, are not doing as well as they did in 2019, he wants that to change. now, i think that that's right, i think that that is a bold statement, for a fed, i said last night, he's not a tin man, he actually has a heart, but his critics do not have a brain. because that's true. >> tepper also thinks we're going to be in this range, like we're not going to break out of the range that we've been in in the 10-year for a while. >> i mean why can't we - >> that's the biggest fear. >> so tepper has been the most right person i have spoken to in my career. even when he embarrassed me and mocked me at goldman in a moment that i'll tell you off camera. but he's been the most right i've seen in my career and he comes out and says these things, i'm going to go with him, rather than the ideologues who run no money, or run billions and are afraid of hyper inflation this

guy is on the firing line. it is a great -- powell said he could be wrong, that's okay, too he's human, about the right now he has been batting four for four every game and i'm not just saying singles it's not just singles. you know who the other guys are? the foul line. >> ben simmens from the foul line. >> philadelphia 76ers, 4 for 14, but very glamorous. >> the worst part of the epic collapse is, dr. j was sitting in the front row to witness it all. my voice is not cooperating this morning. i apologize. dr. j and iverson. >> ai. >> yes. >> in the house. >> was that practice >> do we have that chart, guys there was a probability at one point, the win probability for the sixers with two minutes left in the third quarter, when they were up by 26 was 99.7%. >> okay.

well, that's all of the people, the ideologues who think that powell is wrong. that's the chart of them. >> i thought that was the amc chart. >> that's meme those guys were so good. do you see all of that >> that was the meme team last night. >> that was a meme team. >> you see the executives from corsair who dumped into the memes? how about the people who sold wendy's into the memes they just blasted the memes. the memes should stay in their lane and the lane is - >> look at these guys. >> they're unhappy. >> they should put those things over their eye, not their mouths >> gamestop is the one that they're right on, okay because ryan cohen has laid out absolutely nothing which is very smart and they're right on amc, because there is no reason why they're right, so let's go right back i reiterate -- >> i was distracted you with the water drink. i apologize. >> i remember stalin, not that tepper should be confused with stalin, the pope would say,

talking about communism, and how it's going to fall and stalin asked how many divisions does the pope have? how many divisions do these ideologues have? how much money do they really run? >> nothing. >> tepper has divisions. and dave, i didn't mean to -- well, stalin >> you said going into yesterday, if the fed kind of did nothing, that you wanted to stay with the energies, the heavy machineries, the chemicals. they did more than nothing >> come on, so listen -- >> they did more than nothing. >> if he did absolutely nothing, we have no credibility whatsoever and the market would go down but he said was listen, listen to that press conference, and he said we did not talk about raising rates. we talked about the economy. and that's weigh mean. the economy may need to have rates move, but i don't want to bore people, i'm not oblivious, i will do what i have to do but

right now i still want to get to more employment. that's smart in what world is that wrong? that you shouldn't be focused on employment >> it may be smart but it can have different ramification force the kind of stocks you want to buy. today, do you want to buy the stocks i am not saying you. but rates remain low - >> a lot of people think he is a little more hawkish. buy wells fargo. >> rates are up 10 basis points. they were 5 basis points going down >> but i mostly think that you can kind of buy, this is the weakest part of the year the next five days are not a time that you want to buy. day six, i'm blessing. >> is it a coincidence that the banks today are in the green they have been in the red almost every day. >> and at least know the fed could raise and people want it buy the banks. >> seasonally weak time, okay? and hey look, tepor to wapner.

>> what about tech >> tech, rates up. >> this is not a good time i'm going to reiterate, the great larry williams, the greatest technician of our tiv, 22 times out of 22 times, the next five days are weak. so why should i think this is an outsider 22 out of 22 starting tomorrow. 22 out of 22 so i will say no for the 23rd time it is going to be trong i'm not going to balk. but i think when we get into july, you will look at the stocks and say why didn't i buy? what happened. >> does any part of you after what powell said yesterday think -- we're going to have more inflation, it might be more persistent than the fed thinks, they're going to raise rates probably twice at minimum in 2023, so maybe this is as good as it gets >> what's not to like? beginning in july, you can start buying again look, i'm bullish. i think the next few days are bad.

but i think powell acquitted himself very well, and the critics have no game okay they have this come along with the same rap, they are just oblivious to everything, they get away with it because they sound really smart, i've been around these guys all my life, they sound really smart. you know who doesn't sound really smart you know who is the one guy who doesn't sound smart and calls it like it is and has been right? tepper tepper is not, he's a student of making money the other guys are just students and professors he's not a professor >> do you have a different feeling on multinationals if th dollar gets into a trend where it starts to strengthen. >> i like your bluff. >> there was that, do you remember that, what was it like last week, this week, i didn't remember, the single billion dollar bet. >> i was telling you >> black rock. >> there's a great $4 spac people should be buying -- a

good manager, outstarting all of the other banks in europe which took a lot of risk and anna is not in a club, and probably doesn't take women anyway. >> i have a lot of interesting calls to talk about too. >> that is big news. tepper won -- tepper one everybody else zero. >> we will take a quick break. >> everyone else is ben simmens. >> mark cuban says he took a quote hit. >> he said he took a hit i thought that was great he admitted he got it wrong. and he is another guy with game. >> we'll do more after the brael break. >> plus it was a year ago that jim taiclet became ceo of lockheed martin. he joins us to discuss growth amheid t recovery. more "squawk on the street" from the new york stock exchange after this everything goes right. or the one where nothing does.

with comcast business you get the network that can deliver gig speeds to the most businesses and advanced cybersecurity to protect every device on it— all backed by a dedicated team, 24/7. every day in business is a big day. we'll keep you ready for what's next. comcast business powering possibilities. what happens when we welcome change? we can make emergency medicine possible at 40,000 feet. instead of burning our past for power, we can harness the energy of the tiny electron. we can create new ways to connect. rethinking how we communicate to be more inclusive than ever. with app, cloud and anywhere workspace solutions, vmware helps companies navigate change. faster. vmware. welcome change.

mark cuban saying he took a quote hit from a cryptocurrency token crash, tight tan plunged $60 to a fraction above zero this morning last night, cuban tweeting i got hit like everyone else, the crazy part is i got out, thought they were increasing their tvl enough, and then bam same day that coinbase was reiterated sell at ray jay thought thought i would mention that because we're talking about

crypto, and even the best and the brightest are not immune to these swings >> panic sale. i was, when i read it, i mean i own, i had as was suggested 5% of my assets in ethereum and bitcoin, and i read this, and i say okay, that was the long one. the guy raised points about tether the other daysaying the balance sheet is bad, and that's an interaction method for coins and the new york state attorney general won't let them be in new york and no one cared at all it was like, that piece was like a three-fold, i did two pieces on it because i had tim on, the commodity futures trading and he was worried about tether, and i think people yawned and would rather play tether ball than worry about tether. >> the moral of the story may be, jim, that it doesn't necessarily matter who the big name is, who happens to be a supporter of x, y, z,

cryptocurrency. >> yes. >> it is so volatile that a lot of these moves are driven by the musks, the dorseys. >> perhaps -- >> the cubans of the world and they can still lose. you can still have extreme volatility. >> just because you're a billionaire, this is a good lesson for cnbc, just because you're a billionaire doesn't mean you're always right billionaires get it wrong, too, okay and i do want to point out that it's again ideological, that people think you can't lose money and you say if you sell, you're breaking the ranks. you're breaking the ranks of it. this is not brave heart. this is money. >> do you have a look at coinbase sell, underperform >> i'm with moffett nathanson, i've been disappointed. >> it's like four something. 400-something at ipo i have been disappointed with them i mean like wow. not good

>> there's always cathie wood out there to buy some more. >> like roblox. >> she will buy more it will be down again today and she will buy roblox, she is the greatest average down ner history. no one averages down like cathie wood. >> we got to run up next, it's a cramer's mad dash, as we countdown to the opening bell, and in the next hour, do not miss the global summit ceo with the mcdonald's ceo. more "squawk on the street" when we come back oh, i've traveled all over the country. talking about saving with geico.

but that's the important bit, innit? showing up, saying “hello! fancy a nice chat?” then we talk like two old friends about sticky buns and all the savings you could get by bundling your home and car insurance. but here's the real secret. eye contact. you feel that? we just had a moment. [chuckles] who would've thought it? geico. save even more when you bundle home and car insurance. ♪ when i was young ♪ no-no-no-no-no please please no. ♪ i never needed anyone. ♪ front desk. yes, hello... i'm so... please hold. ♪ those days are done. ♪ i got you. ♪ all by yourself. ♪ go with us and find millions of flexible options. all in our app. expedia. it matters who you travel with. expedia. ah, she thought that squirrel on your brand-new flat screen tv

was an actual squirrel... leave it. purchase protection for what you didn't see coming. one of the many things you can expect when you're with amex. wondering what actually goes into your multivitamin? at new chapter, its' innovation, organic ingredients, and fermentation. fermentation? yes. formulated to help you body really truly absorb the natural goodness. new chapter. wellness, well done. time for cramer's "mad dash" as we count down to the opening bell, doing some food shopping >> you remember a guy named rodney who always got no respect? >> rodney dangerfield? >> no, rodney mcmullen

the ceo of kroger. he delivers a very good quarter. he has $1.19 versus 94. a billion dollar buyback 10 and 11%, same store sales in any other language and the comparable store sales, down 4 people looking down 6.6. digital sales. and it's not enough. no no they have to sell it so i hope he comes on, two cincinnati people, right, sara eisen -- >> today. >> closing bell. >> yes. >> and look, the stock has been right. now, people, in respect here, except for warren buffett, they didn't respect him here, and look at him here, the trajectory here, i say give the man some respect. and when he comes on, he is going to tell a great tale so those who are dumping or shorting kroger, be careful. rodney mcmullen has become a very good spokesperson for the entire industry as has al bertson's. >> i was thinking about albertson's.

asked about inflation and margins and that kind of stuff. >> this is the right moment for the supermarkets, the right amount of inflation and make a lot of money so the guys dumping kroger, they will regret it when you hear rodney when he comes op and you give that man respect. okay he's earned it >> all right we'll see the interview later today. the opening bell is just minutes away

this is the sound of change. it's the sound of low cash mode from pnc bank giving you the options and extra time needed to help you avoid an overdraft fee. low cash mode on virtual wallet from pnc bank.

one way we're making a difference.

we believe that the market, the world is in a very expansionary period. i predict there is ten good years in front of us because the world is becoming more digital and everything digital needs semiconductor and covid created this terrible situation that demand spurted, and supply chains were disrupted. so we have years just to catch up to what we see on the books today and we're hearing our

customer, the backlog, remaining extremely strong, so we have to go catch up to the day, but the world is getting more digital, and every aspect >> that was intel ceo pat gelsinger talking chips and supply chains with the qualcomm ceo and john ford yesterday as the evolve global summit working through this issue, chips have actually been doing kind of well lately. >> right well, i would like to hear more about what lisa su has to say, which is amd, competitor to intel. >> top of the heap >> in your mind, right >> well, nvidia. >> and they have less work to do than intel in terms of meeting customer demand and then nvidia is extraordinary. you have to go back to the general meeting last week, if you want the primer of what the world looks like [ applause ]

>> jim farley, ford, if they have enough chips, they would have done a number that i think would have shocked the lights out but the reason you don't have, the shortage is manufacturing shortage, first of all the chinese are hoarding, and the real issue is everyone wants to be in high performance comfo computing. >> the opening bell, as you hear them, at the big board digital learning company celebrating the recent business at the nasdaq and genetics company 23 and me is celebrating the listing via spac and the co-founder which join tech check this morning at 11:00 eastern. >> quite enjoyable really understands exactly how -- the product, i'm always amazed that, the company did have some problems before, but i think it's a company that really excites people, and i think that it's one of the few spacs that i think has brand name recognition. >> and let's start the market

and see how they start, after the digestion period, of post-fed activity, what happens, right? we sold off yesterday. >> seasonally weak period. >> seasonally weak. >> the tepper comments him telling us he thinks the stock market is here. >> buy on weakness but remember, the seasonally weak period extends until the middle to the end of next week so i mean don't try to fight it. feel it. >> i like that >> put that on a t-shirt. >> yes. >> jp morgan is up we said a lot of the banks were up a little bit of a reversal. >> and i like the the lenoir quarter and the executive chairman has done a terrific job and i think there are some stocks that could go up but if we were really in a moment where this is bad, and the fed is as silly as everybody has said who has come on air, then we should be down, i don't know, 2, 3% really if you listen to those people

who basically think that jay completely misjudged now, there is a lot of stimulus. and that's one of the things that albertson's says, that's not jay's fault ta there is so much stimulus, you never hear people come on, here is something, you never hear people come on and say you know what, i share jay powell's worry about african-americans and hispanics not having enough jobs there's 10% employment and 5%. why don't you hear that? i mean that is part and parcel with what's wrong with our country. so why is that not brought up, except for by jay powell jay powell brought it up twice yesterday. and just people saying entirely, what can we do no, he actually cares. that's why it makes him a great fed chair. he cares about the disenfranchised. the other guys just care about the billionaires. >> which is why he is going to keep the floor to the, the pedal

to the floor as close to the floor as he can, without going the other way. >> and helping people get jobs, i don't understand why that isn't the mantra and the ethos of this country. this guy is doing what we all feel should happen which is that we should have afters and hispanics do better in this country. but no, he gets criticized for doing that, for wanting that let's not be so two-faced. let's be one-faced we want. that and so does jay. >> and what stood out to me, speaking broadly about the people who are out of work and the many millions who, are that we're not going to forget about you. >> who is overrepresented in the out of work? and he doesn't like that because he has a heart and he's a thinking person so i'm not going with these guys who say well, he screwed up. i'm going with people who is saying he is trying it do what is right for the country. >> let's note that the s&p is trying to turn positive, fractionally so. the dow is trying to turn positive

fractionally so. >> if you were so bad, do you think they would be trying to turn positive? no because tepper is going to be right. it can't be an explosion to the upside too many questions i mean versus ford, should be up more than it is. 23 cents i just think that bide your time, don't be getting aggressive here. but understand that we're not in a bad time but we are not in a bad time in terms of the fed, but seasonally yesterday. >> go back to what you said last night, stay the course >> 22 out of 22 times the market is weak during these days and i don't think you will get an exception here >> look at freeport. >> freeport, nucor, mosaic, those are the stocks that have really take continue on the chin lately in the materials space. >> the chinese has decided that copper has gotten too high i think the steels we're looking for in infrastructure, bounce, and they seem not to be able to get that through and we should talk to joe manchin, in control of the country right now. >> did you see that call on

disney today by jpmorgan reiterated outperform? the stock is moving a little bit this morning and it is given 175, not so bad for shares of dis, and over the past few months, it hasn't done all that great, right, a lot was already in, remember when it was sub-100, here it is 175. >> down 3% for the year. i was going to talk about it, i have a speech today at 11:30, with members, recommending to sell it but we got our hands tied that's okay. we can play by the rules and the reason i say that is because i think i've been unimpressed. i thought the last call wasn't that great i thought when people started seeing the reservations, that the stock would go up, but it hasn't reacted well. >> you would recommend to sell the stock? >> i would say take profits of disney >> really? >> i have, i don't know, 100 and some - >> is it a disney-specific thing or a little feel about travel-related stuff

>> how he's running the country. >> really? >> yes >> wow, i mean just disney plus just, i mean it got off to such a rocket start >> i didn't think that, i thought that conference call was basically in coherent. it was an incoherent conference call >> i'm shocked to hear you say that >> well, it was just, i don't know, i think it was, i refrain from calling it amateur. >> well, he did guide the stock from 125 to 175. >> well, i just think that there's a man there, bob eiger, and you take advantage and you say listen, i want to do this right and like my friend dave, my neighbor, and say to darius, it's your airplane, i would have gone over and said bob, look, i want to be sure i'm getting this right, i want this call to be very right, i think that when you look at kj, kevin johnson -- >> starbucks. >> yes i think that he wanted to get

his conference calls right, because howard schultz always had to do a conference call, but i thought this conference call was, it was unimpressive it is not as bad as at&t. >> doesn't he deserve, to get his legs under him - >> going to bob, and say hey, bob, i want to say he is as good >> what is he going to do, have bob record the call and be like a ventriloquist. >> i like teach evers, dave tepper a mentor and teacher of mine, i'm not going to disagree, and i think you had an opportunity to go in to bob and say here's my concerns, i would like to phrase it that way, this stock is down 3% for the year even though the world is opening. what does that tell you? shouldn't that stuff be up nicely >> well, tit was over 200 bucks. he listened, i don't think it is too strong to say that he had a constructive dialogue with dan leb of third point who was in

the stock and said look, we want you to dramatically up the spend for digital, we think it may be prudent to cut the dividend, get rid of the dividend, to do that, we cut the dividend, he increased the spend in digital, the stock went from 125 to 200. >> 203. >> it's not like he doesn't know what he's doing. >> no but i do think the way the story was communicated, it has now become disney plus, you know, espn, where i have to watch every single day he didn't talk about the franchise. he didn't explain how great it was. he emphasized something, again, disney plus is now espn, so it doesn't have any ads, the stock goes to 150. you shouldn't have put that narrative in there it is not a good narrative if i spoke with him and having lunch, i would explain how to do that conference call with more conference calls than anyone in america, that's actually true by the way. >> i know. >> netflix, overweight. >> and then he said that - >> they didn't have enough

programming, and they will get enough programming >> the read is good. but i thought that bob made it so that now we got a whole new albatross in this time, and that is disney plus and that sells the franchise short. >> you know what's positive across the board right now stocks dow, s&p, nasdaq all turned positive >> didn't the fed chief do a bad job and he's an idiot and doesn't know what he is doing? oh, maybe. >> we're going to talk to somebody coming up, who thinks he knows what he is doing, when we come back, an exclusive with the lockheed martin ceo, jim taiclet one year after he took the top job at the company time for the bond report take a look at treasuries. ripped higher after the fed decision yesterday, they've come off that level a little bit. there's the 10-year, it's at 155.5, as we speak two-year, all the yields, are down, the five-year though is up, we're back after this.

what happens when we welcome change? we can transform our workforce overnight

out of convenience, or necessity. we can explore uncharted waters, and not only make new discoveries, but get there faster, with better outcomes. with app, cloud and anywhere workspace solutions, vmware helps companies navigate change-- meeting them where they are, and getting them where they want to be. faster. vmware. welcome change. stay restless, with the icon that does the same. the rx crafted by lexus. get 1.9% apr financing on the 2021 rx 350. experience amazing at your lexus dealer.

welcome back morgan brennan joins us now with a very special guest. >> that's right, thank you this month marks one year since our next guest took over as cross of the largest defense contractor lockheed martin with more on not only the year that was but his vision for the future of geopolitics and shaping national security priorities, joining us now jim taiclet, lockheed martin chairman, president and ceo. jim, great to have you on the show. >> good morning, morgan, jim, scott, great to be with all of you. >> we have so much to get to, including the fact that you are celebrating one year at lockheed, butfirst i just want to start with the news of the week, your reaction to what we saw on the world stage, whether it is that president biden, president putin senate, a g-7 meeting that signaled at least the beginning of a more hawkish stance perhaps toward china. how would you assess not only

the threat landscape, but also the policy that's taking shape where national security is concerned under the biden administration >> well, morgan, it felt like great power competition was back on display very vividly this week, both with the g-7 and the nato summit. the g-7 a little more focused on the china threat, if you will, and the may tomato summit -- nato summit directed toward russia our allies are coming back together, which is fantastic are fantastic and we have an integrated defense strategy and the u.s. government will set the foreign and defense policy and lockheed martin is in a position to support them better than ever. >> and the international sales are a significant part of lockheed martin's revenue. one part, if greater spending, we've seen greater spending by nato allies and that is certainly one piece of the puzzle there, i wonder if you think that continues >> i do think it's going to continue both domestically and

among our allies, again, we're all realizing that this emerging threat is getting worse instead of in a better situation and we're bringing our allies together with us in a way that's going to comprehensively address this threat and our business, at lockheed martin in my view is really the determines and the deterrent. we may be the world's largest defense company, and our real mission is to drive deterrence to a higher level and prevent war and conflict, and work with our government and our allies to do that. >> i mean with lockheed in the midst of this pandemic, it really hit the ground running, not only in terms of the covid response and what's that meant to not only the company but the broader industry and rolled out this 21st century war fighter vision, with this planned, strategic investment, focused on next gen capabilities, technologies, including 5 g, how quickly can you roll that out and what does that look like, given the priorities that we see materializing right now? >> well, i'm really proud of the

company. i want to touch on morgan, your first point, through the whole covid pandemic, about 115,000 people with lockheed martin, about half of them never left the workplace. they were going to our factories, to our customer bases, and to our classified spaces all through the pandemic, so they kept delivering for customers and for our military and department of defense customer, all the way through. the other half pivoted very quickly with the help of our really terrific i.t. organization to be able to work from home. we never missed a beat we delivered for investors and for the customers. so i want to really take a moment to recognize all of our employees for doing that, through a really tough year. but we're also, as you said, pivoted the whole company and we're reoriented, i feel confident we're reoriented to the 21st century vision. and jim, you saw this back in my last company, where we were working with a telecom and

technology leaders in the united states, and elsewhere, to drive 5g digital infrastructure, at an accelerated pace, and we're going to use the same tools, i'm touching base already with the same partners, many of whom you know very well, and some of them will be on the show, i think later today, where they are all in on this, they want to help us accelerate 21st century technologies, like ai, edge computing, the distributed cloud, et cetera 5g, of course, and into the defense enterprise, and lockheed martin tends to be the leader in helping our commercial tech and telecom industry work with us to do that. so it's pretty exciting. >> well, that makes me feel very good, jim, because you've been a remarkable ceo at american power, i've watched you work here, amc up by the way huge under your tutelage, but there's something that disturbs me, jim, and people don't know this about you, 5,000 hours you flew in the

c-114 b starlet which is really amazing, it is fantastic work, you were in the air force, you were amazing in the air force, but that plane was in the air for 40 years, and i've got to tell you, jim, when i listen to what you're talking about, 5g, you know that anything that's 40 years old is put band-aids on it unacceptable how can we be sure that you're able to get that great technology into other planes that are already seeing, the f-35, you can be the change agent, jim, you can tell them, listen, we need nvidia in these planes, we need to have the finest things that amd has, we need to be able to get with qualcomm can you do it? can you shake them up? because we cannot have 40-year-old planes with great people like you flying them. >> look, jim, what we're going to have to do is both. we're going to have to introduce these technologies in our newer platforms, for example, the f-35 has what you need to have an edge compute node in a network system it has the largest data storage

of any jet aircraft, it has the highest computer processing power of any jet fighter aircraft, and we're adding to its connectivity, it's got connectivity between f-35s, which is a really high through put data rate but we're actually driving that across other platforms, as we call them and i'll give you a great example of having to backward integrate the newest technology into those older aircraft, jim we used the u-2, which is even older than a c-141. >> come on the u-2. >> and i'm not kidding we turned a u-2 into an edge compute node a cell tower in the sky. and we connected f-22s and f-35s, in an actual exercise with our customers in the field and showed them how you can start to build this network-centric connectivity across both new and legacy platforms. so f-22, f-35, latest fifth generation aircraft, through a

u-2, believe it or not forward integrate, backward integrate. >> you were the person to do it because you always had a great way of dealing with people, even people that you didn't necessarily get along with that you ended up winning over, and one last question and we will go back to morgan china. have the right kind of weapons, if china continues to make noise, even want to challenge us in taiwan, are we set up to be able to stop them and make them feel like this is a dangerous move that they might be trying to do? >> yeah, you're hitting on a really important point, jim. we have platforms as we call them in our industries, ships, aircraft, submarines, et cetera, and pound for pound, unit for unit, our platforms, i would say are more effective and competitive than those of china today. but no one is standing still so we're going to have a more

competitive unit to unit comparison with planes from china versus planes from the u.s., for example, as we go forward, and they will probably be building more of all of that than we will given our budget constraints as a society what we need to do now is bring the network effect of adding to those really powerful platforms and uncertainty later where the connectivity, we have a 5g.mil architecture that we're building that makes our capabilities unpredictable. they won't be able to model and war game against us as well as they can today, jim, and that's one way to keep up and stay ahead of this emerging threat, this growing threat that you just pointed out. >> a key piece of this discussion is space. we saw china launch astronauts to its new space station last night. i was speaking to the former n nasa administrators, he said, yes, we're in a space race with china, the u.s. is ahead, but we

need to make sure we stay that way. obviously you have military space, commercial space programs in your portfolio, how do you see it >> our space business is one of our greatest assets, morgan, at lockheed martin, it's going to actually be the overall tie together of the 5g.mil architecture is a lot of space based, we have low earth orbit, and partnering with commercial companies to accelerate our ability to launch more satellites more quickly into the low earth sphere, for example, so the space business for us is really important but on a broader scale, and going back to jim's point, china looks at civil space competition as a part of its national security effort to advance itself versus the west there's geopolitical and scientific and ultimately military advantages for them to drive civil space exploration,

and demonstrate that they can move faster and even, you know, more aggressively, let's say than we can as a society in civil space. so there's a national security aspect of that competition which jim bridenstein is correct is very real. it goes even beyond nasa versus civil chinese space. it actually encompasses a broader effort on their part. >> you mentioned the commercial partnerships, you have also been inquisitive. certainly the industry and investors are closely watching the regulatory review prose for your $4 billion plus acquisition of aerobus, especially since w have a new fcc chair. >> we're fairly down the road with the new chair and will be brief on all the regulatory requests of feedback we

provided our integration plan is progressing as it is allowed to progress in this kind of situation. we'll be ready to integrate if we get approval by the end of the year, we hope, but what's important about the aerojet rocketdine acquisition, it's an excellent company but it's going to be better with the amount of independent research and development resources we can put into it from lockheed martin, integrate their engineering corporation into and with ours and make them a better supplier for our competitors in the industry as we go. this is a great asset. we can make it better as the owner and, that's what this is really meant to do there's two other little pieces that are very important, one is we're going to reduce and committed to reduce the cost to the government of the products that aerojet rocketdine provides to the government on a significant scale, frankly, and the last thing i'll say is one of the advanced technologies that kind f jim was pointing to

is hyper sonics, these are -- >> jim, i'm sorry, i have to cut it off -- i have to cut it off because unfortunately we're at the top of the show, so hypersonic, something i hope you'll speak to us more about. jim tacilet, lockheed martin, thank you for being with us one year into uryo tenure. >> he's the best. >> happy to be here! "squawk on the street" will be right back >> asia, i use it alle

place. meme ster, whatever you call yourself, wall street, stoop bet, we've got clean energy fuels, and that is one that they like that i like, and i feel really badly that i like it given the fact that they do no work, and i do homework. i'm not trying to be antagonistic, i'm trying to be vicious. >> you do do a lot of homework. >> thank you very much >> i'll see you back tomorrow morning, and we'll see you later on "mad. when we come back, our launch on the markets and the fed. ♪♪

♪♪ ♪♪

welcome back to "squawk on the street," rick santelli here with live breaking news, leading economic indicators for the month of may expected up 1.3%, arrives exactly at 1.3%, following a revision that's 1.3%, and if you reverse those digits, the 3.1%, that is the all time high going back to

february of '59. that was last may, so you can see we have come off of it these are still good numbers, and they do represent an ongoing spat of positive numbers 1.3, 1.3, and 1.3. t three of them in a row morgan, back to you. >> rick santelli, thank you. good thursday morning, welcome to another hour of mosquito. i'm morgan brennan along with scott wapner, carl and david have the day off the dow is do 3/10 of a percent. the s&p along the flat line. we're 30 minutes into the trading session. here are the three big movers. german drug maker curevac tanking after its experimental vaccine is 45% effective in a clinical trial those shares are down 48, almost 49% right now. ford meantime continuing its

ride higher but losing steam saying it's expecting second quarter earnings, amid strong demand for vehicles. those shares up 1% and lastly, the honest company in the red after reporting a wider than expected loss this was its first quarter as a public company shares down almost 9%. the fed moving up its time line on rate hikes, raising its inflation forecast as well ylan mui following it all with more >> you're right, the forecasts are moving higher, which means the dots are moving closer, 7 fed officials now see a rate hike happening by the end of next year, five are projecting one hike, compared to three officials in the last round of projections, and two believe twice. before it was one load hike, and the majority expect the central bank will have raised rates multiple times by the end of 2023 jay powell tried to deflect, and said left off won't happen until

went into the future. >> rate increases are not the focus of the committee, the focus of the committee is the current state of the economy in terms of our tools, it's about asset purchases. that's what we're thinking about. >> powell said the committee began the discussion on tapering and if the economy continues to pak progress, a time line would be announced at a future meeting. he promised the process would be orderly, methodical and transparent. on inflation, powell acknowledged that there's a risk that prices will remain high he said the pandemic has made everyone more humble about forecasting but said the fed would not hesitate to use tools for a persistent increase in the data >> thank you very much we have breaking news, diana olick has it from the supreme court. >> yes, and this is on the latest challenge to the affordable care act, also known as obama care and it will stand. the court held in a 7-2 decision that the plaintiffs do not have standing that is a legal right to sue to

challenge the individual mandate because they have not shown a past or future injury fairly traceable to the definite's conduct. what was being argued here is what part of the law is constitution, then the whole law is valid a group of 18 red states led by texas argued that it's unconstitutional and can't be separated from the entire act, so the entire act goes down. that, of course, was struck down by the court nearly a decade ago. the supreme court upheld the individual mandate by calling the penalty for not buying into it a tax but republicans during the trump administration dropped the tax to zero, and then argued that since it was zero, it's not actually a tax now, lower courts ruled in their favor but the question remained what happened to the rest of the affordable care act, now we know, and as we note, 20 million americans currently depend on obama care for their health insurance, and again, it does stand, back to you guys. >> appreciate that very much billionaire investor, david tepper speaking with me earlier

this morning, he says quote the stock market is still fine right now after jeh powell and the fed's announcement, let's bring in ubs director of floor operations, art cash, and arthur, it's good to see you as always >> my pleasure, thank you. >> you think the stock market's fine for now, too? well, i think there's some seasonality to worry about i think the fed got past the hurdle they needed to get past i thought that powell was going through all kinds of contortions to try and make it sound as.govish as dovish as possible they had to recognize price increases. highly unusual to see the chairman of the fed up there trying to explain what made cpi as tough as it was, talking

about used cars, talking about airline tickets. that's highly unusual. he even went so far as to question that we shouldn't get too far ahead of ourselves we still have covid, and he started to cite the mutations. there was a highly unusual performance, and i think he was desperately trying not to let the dot plots overspeak the case so i think he did a very good job. >> i mean, he even said as much, don't read too much into the dot plots, it's not like that's in stone in terms of what the move on interest rates is really going to be, right that's part of what his job was post decision. >> oh, absolutely. as i say, he was going out of his way to say, look, we're still pretty much dovish, we're not thinking about rates, we're only thinking about the qe supplementals, but interestingly enough, our mutual friend peter

buklar noted that among the questions nobody asked the question that your own sara eisen did a couple of days ago with bullard when she said why are you still buying mortgage backed securities when real estate is at all time highs. you can't get houses there's no need to help out on the mortgage basis, and nobody asked that, and i think that's something that does need answering. >> yeah, i mean, it's such a key point given everything we're seeing play out in housing also noted in his note this morning, in terms of the market's adjustment to the growing reality, do you see it the same way >> i do. and i think there's a couple of things going on here that we who come on to your media haven't really noted i think some of this reversal in commodity prices, lumber and the

like, people are not crediting the tightening in china. i mean, it's counter intuitive because they look like they're having a resurgence of covid over there, so you wouldn't think they would be tightening i think you're beginning to see the effect of the current chinese tightening as much as the transitory aspects, so yeah, we're going to keep watching prices we're going to keep seeing what the fed will do. i think they will be very careful about not hyping too much you saw they adjusted some very minor rates to keep money markets in shape, so they're tinkering. they're tinkering. >> you know what i wasthinking about too, art, is that you could very well have the most divergent atmosphere and environment for rates globally than you've had in a very long time if the u.s., if rates here start to rise and the fed actually

hikes on that time frame that it lays out because our recovery has gone so well, while at the same time, the rest of the world, parts of europe are behind us, you're no longer going to have this close in spread of where rates are between the united states and say, europe. it's going to diverge to levels we haven't seen in perhaps more than a decade? >> well, that will be interesting to see because don't forget rates affect currency changes and that affects trade so you're going to get these people being, i think, quite defensive about it i think you're right the other thing, and i have said this on this very program time and time again, the viewers should watch the velocity of money. it's followed by the st. louis fed. you only get real inflation when we lend it or spend it right now, we have tremendous

excess reserves, the analogy i use, it's as if the fed took a helicopter over your house, and dropped a million dollars on your lawn. that might be thought to be inflationary but only if you spend it or lend it to somebody else if you're nervous enough to put it in the garage, there's no inflationary impact there, and that's what we have been seeing, you know, since the problems began back with the real estate and banking crisis people have been timid about spending we're building up savings and we're not spending at the rate we might watch the velocity of money. >> i'm so glad you brought that up, alternative. i mean, we're showing a chart of the dollar index right now which is higher today but over the course of the past year, it is down somewhat. the fact that we have seen a spike in the last 24 hours, what would you take to be the velocity of the dollar index or

the trajectory, maybe i should say of the dollar index from here as we have conversation around commodities, too? >> yeah, no, i think you want to watch. we can't overestimate an area that you're a big fan of, which is shipping and trade. you know, home depot has gone out and hired a container ship just for itself because it's having problems getting supplies in we think we may see the same thing from people like walmart and target and even though terry lundgren says by this time of year the christmas supplies should be all in i don't think they're all there. so we're getting this inflationary pressure because of scarcities in the supply chain and that's got to be addressed, so i'm going to be particularly attentive, morgan, to what we begin to see, what divergences

there are between interest rates here, and the currencies, particularly with europe and maybe even with china. i watched this tightening in china very very carefully. >> sounds like you will, art, always good to talk to you, art cashin, ubs this morning >> my pleasure >> as we head to break, here is a look at the road map the next hour, new comments from mcdonald's ceo about the pandemic, labor shortages and more. and later this hour, morgan's sit down with the harley-davidson ceo as the company faces pressure from inflation, labor and tariffs the silence just says everything it's time for me to look up. >> finally, new funding valuing the defense tech start up androl at more than 4 1/2 billion dollars. we're having a national security focus this morning we're going to talk with the cofounder, we have a jam packed hour of "squawk on the street" still ahead. stay with us

to prepare our people for anything. you're late well, cdw amplified services experts will consult with you to design, orchestrate and manage your most complex technologies to help you quickly overcome any obstacle ... without all of this. oh, that is better. who's that? oh, if you want coffee, you gotta get past tantrum. you're in for a brewed awakening. for technology that moves you forward, trust cdw amplified services wondering what actually goes into your multivitamin? at new chapter, its' innovation, organic ingredients, and fermentation. fermentation? yes. formulated to help you body really truly absorb the natural goodness. new chapter. wellness, well done. keeping your oysters business growing has you swamped. you need to hire. i need indeed indeed you do. the moment you sponsor a job on indeed you get a shortlist of quality candidates from a resume data base claim your seventy-five-dollar credit when you post your first job at indeed.com/promo

another day, another chance. it could be the day you break the sales record, or the day there's appointments nonstop.

with comcast business, you get the network that can deliver gig speeds to the most businesses, and you can get the advanced cybersecurity solutions you need with comcast business securityedge. every day in business is a big day. we'll keep you ready for what's next. get started with a great offer, and ask how you can add comcast business securityedge. plus, for a limited time,ask how to get a $500 prepaid card when you upgrade. call today. welcome back to "squawk on the street," we're continuing our coverage of cnbc's global summit. >> that was very evolutionary, wasn't it? >> that open >> it was nice they did a nice job. >> our very own carl quintanilla spoke with mcdonald's ceo chris

co >> the pandemic did offer us a number of opportunities, one was to simplify our menus. we had to do simplicity in our menus because we didn't have as many people able to work in the kitchen. i think there was an opportunity where we saw the power of our core menu. one of the interesting things that happened is in the pandemic, people started going and wanting their familiar favorites. they were less interested in experimenting and much more interested in our core, and so getting regrounded in that from a business standpoint, and then we're so fortunate in our business to have drive through in 95% of our restaurants, and to see how that became such a go-to service channel for customers as they were dealing with the pandemic, i think those two things together, it is all of a sudden this mindset switch from being, you know, one of defensive, to really being much more aggressive. >> i think that's fascinating because it was your competitive

advantage, more drive throughs than anybody else, better engineering. i'm sure that you would argue that anybody else and you streamlined to your core, and focused in on delivery and digital. dine in is not one of the d's you talk about much, and i would never expect you to say that dine in is dead, but long-term, is that a fabe >> i think dine-in is always going to be here eating is such a social experience, and dine-in is a part of that social experience i think dine-in is here to stay. it varies also around the world. >> wages, of course, it's been a remarkable year on that front. there was the argument made the other day, and i know you have recently made some announcements about raising wages on average of 10% for ten of thousands of employees. some argue that because $15 is sort of now a benchmark of sorts, not just mcdonald's but amazon and costco and starbucks that the so called fight for 15

has been essentially won do you think that's true >> i think what's happening is that you're seeing that a great economy is very helpful to growing employee wages and i think many of the changes that are happening from a wage standpoint are happening because of companies like mcdonald's needing to compete for the best talent so i think, you know, what you're seeing here is the benefit of that, you know, our move that you referenced around paying $15 an hour by 2024, which is the time line that we laid out is because of our need to stay competitive, and when you have walmart and amazon, target that you referenced, all moving to $15, certainly that's a talent pool that we're competing with so we respond to where the market is moving, and i think there's also been, you know, a topic about whether there needs to be, you know, a change in the federal minimum wage we have always said that, you

know, we're happy to have that conversation ultimately that's a policy question for lawmakers to make, but i think there's no doubt t that 7.25 in this day and age is not what you should be paying or need to be paying to be competitive in the marketplace whether that's mandate through legislation or free market capitalism wages are going up because the economy is strong. >> yeah, you know, speaking of issues that are either led through policy or activist pressure i'm thinking of all the things that ceos are being asked to weigh in on in this modern era, whether it's voting rights or wages or benchmarks on diversity and inclusion, does that ever make you uncomfortable do you think you're being asked to address things you really weren't hired to address you were hired to run a business >> i think, you know, part of it is to recognize that the role of

corporations in society, i think, has evolved over the last call it 20, 30 years, and it's evolved for a number of reasons. i think one is that, you know, other institutions like the federal government are less respected and less viewed as being problem solvers, and so one of the consequences of that is that corporations are being asked to stand in wherein the past other institutions played a bigger role in this. i think second is you're seeing whether it's from employees or customers that, you know, they are making decisions about where to work, who to be patronizing, based on does that corporation reflect the values that are important to me, and so i think both of those in combination have required corporations to become a little bit more clear about what they stand for. i think if you're a consumer company, even more so. if you are a global consumer company, even more so.

>> that's our own carl quintanilla, and the mcdonald's ceo. everyone is wondering how many of the pandemic trends are going to remain, and that's what the question is, is dine-in dead, a drive through forward business moving forward, he's like no, no, dine-in is here to stay. so we'll have to see where all of this goes it's a legit question to wonder because so many things changed. >> yeah, and many different types of fast food companies saw this surge in sales because of the fact that they had the drive-in capabilities that maybe the sit down restaurants didn't have also got his comments on minimum wage were very interested too. the thing to keep in mind with corporations is there's the company itself and the company owned stores but there's also this compilation of franchisees that are essentially small business owners, which i've had a front row seat for, being the franchisee of a burger king's daughter

something near and dear to my heart. >> and people wanted the comfort zone, opting for the big mac over the new innovative item we'll see where that goes as well. >> don't miss morgan's interview right now. >> harley-davidson's chairman and ceo, i spoke with him yesterday, tariffs, labor shortages, a foot at the iconic motorcycle maker, we're going to be breaking that down. "squawk on the street" will be right back

what happens when we welcome change? we can make emergency medicine possible at 40,000 feet. instead of burning our past for power, we can harness the energy of the tiny electron. we can create new ways to connect. rethinking how we communicate to be more inclusive than ever. with app, cloud and anywhere workspace solutions, vmware helps companies navigate change.

faster. vmware. welcome change. that building you're trying to buy, - you should ten-x it. - ten-x it? ten-x is the world's largest online commercial real estate exchange. you see it. you want it. you ten-x it. it's that fast. if i could, i'd ten-x everything. like... uh... these salads. or these sandwiches... ten-x does the same thing, but with buildings. sweet. oh no, he wasn't... oh, actually... that looks pretty good. see it. want it. ten-x it. yum! wondering what actually goes into your multivitamin? at new chapter, its' innovation, organic ingredients, and fermentation. fermentation? yes. formulated to help you body really

truly absorb the natural goodness. new chapter. wellness, well done. we face the world head on. never hide. let's get to work. yeah! ♪ ♪ whoa. that's what i'm talking about. welcome back, it is now time for our etf spotlight, taking a look at the material select spider fund ticker xlb, down about 2% right now down over the past month as the sector continues to sell off amidst a shifting fed, higher dollar, some of the changes being put in place in china which is a key market for materials and of course ongoing infrastructure talks here in the u.s. core holdings, martin marietta, are down this week, alongside

other construction materials names. almost all infrastructure stocks, including u.s. steel, cleveland cliffs, new core, are in the red as well we're going to continue to watch that story, and of course these have been some of the biggest runners, biggest movers in the so called re-inflation trade until now. >> mosaic, down 5%, one of the stocks caught up too this is my readings right? >> it's my read. >> you got it. checking in on fisker, getting a boost after the long-term contract with magna international. and the ceo and chairman of harley-davidson, and more market movers stay with us, the dow is down about 150. ♪ ♪ (upbeat music) ♪ ♪ ♪ ♪

♪ ♪ ♪ ♪ this is dr. arnold t. petsworth, he's the owner of petsworth vetworld. business was steady, but then an influx of new four-legged friends changed everything. dr. petsworth welcomed these new patients. the only problem? more appointments meant he needed more space. that's when dr. petsworth turned to his american express business card, which offers spending potential that's built for his changing business needs. he used his card to furnish a new exam room and everyone was happy. get the card built for business. by american express.

welcome back, i'm rahel solomon, and here is your cnbc

news upkdate at this hour. china is launching the first astronauts to the international space station, the first time they have sent a manned mission to space since 2016. they blasted off from the gobi desert. hong kong arrested five editors and executives of a pro democracy newspaper. 500 hong kong police officers sifted through the computers and notebooks from reporters of the apple daily. it's the first time hong kong's national security law has been used against the press. japan will ease the state of emergency in nine areas, including tokyo ahead of the summer olympics. the company is keeping some measures like limiting spectators at big events suga calling on the public to watch the olympics on tv to avoid the spread of covid-19. >> and disneyland paris reopening today. it was closed for nearly eight months due to the pandemic masks are no longer required in france, did disneyland paris res them for above the age of 6.

the louvre opened a month ago, so france very much open for tourists this summer back to you. >> rahel solomon, thank you, welcome to "squawk on the street," i'm morgan brennan along with scott wapner, because carl and david do have the morning off. we're live from post nine at the new york stock exchange, about an hour into the trading session. let's get a quick which she can on the biggest traders in the s&p which is flat right now. so far, it is tech leading the gains in terms of sector, invade ya, xilinx, some of the top gamers, and in terms of the laggards right now, we mentioned it earlier, but materials are back under pressure, so are energy and financial names you can see right there, mosaic, free port-mcmoran, newmont corporation and nucor and ct industries, a deflation of the reflation trade at least for

now. >> i got that. stocks are mixed as you know, the s&p narrowly holding on to the green. there it is. nasdaq accelerating a little bit, almost up triple digits, about 2/3 of a percent, and there is the dow down about 150. mark santoli is with us now. she called what happened yesterday, a taper tease, and a dot surprise you heard what teper told me, the stock market being fine for now. do you think that will be the prevailing opinion >> i think in general the rethink is going to be not all that big of a change in the big picture. it's a very orderly process. i do think where we came from matters, and by that i mean you're going to have to ask yourself have we seen the easiest financial conditions we're going to see for a while have we seen the most negative real yields, inflation adjusted yields we're going to see in a while. i don't think you have the

answer to those questions. this brings it into view when you have to think about what that means for valuations. it is an interesting dynamic, when the fedex presses alarm on the inflation side, more than what was expected yesterday, and then all of a sudden it looks like we have this unwind of that reflation trade, morgan, as you were saying, so it seems like the markets and the fed do this thing. it's just kind of this three legged race they're walking. >> easiest conditions. >> yeah. >> okay. fine but they're still easy >> exactly and that was tepper's point, you still have a very accommodative fed. >> no doubt about it junk bond yields are 4%. they're not throwing a tantrummtantrum. it is around the edges, massive upward revisions to earnings corporate balance sheets are in amazing shape. it's hard to build-a-bearish case deceleration from peak reopening

we're going to get. >> you watched closely as well, the vix is at 17 right now. >> not expressing stress or alarm, it's a benign level at this point one of the reasons it also is contained is all of the push/pull underneath the surface of the indexes you have so many stocks going up, versus so many stocks going down, the index itself has been tracked here, that's something that's been the case for a couple of months now, and it doesn't last forever, usually you have some of the volatility unleashed a little bit, and sometimes it gets interesting when that happens, but right now you're right it's not necessarily something you would look at it and say okay, what the fed did yesterday changes the game. >> nor does the yield on the ten-year which i'm looking at right now, now with the lows of the morning, 153 all right, so we bumped higher, right after the decision yesterday, but now we have settled. >> that is true. on the ten-year specifically now, the shorter maturities, the

ones that are more sensitive to what the fed is going to do with overnight rights, you had a flattening of the curves not to get in the woods but that's where the action was in terms of repricing the path for future rate hikes. again, not necessarily an outright negative thing long-term, given the economic context you would need to get the rate hikes it's an adjustment to where people were. market had to shuffle its feet and figure out where the right spot to stand. >> good to see you, we'll see you throughout the day that's mike santoli. >> there it is again. >> you like that >> i do. it's cnbc's evolve global summit i spoke with harley-davidson's president and ceo, jochen zeitz who took the helm as the pandemic was gripping the world to discuss his five-year turn around strategy to restoke sales, boost profitability, expand ridership at the iconic motorcycle brand take a listen. >> this was a big challenge, and it just was excite exciting,

actually, to get into it dramatic as it was, i looked at this as a great opportunity to lead one of the most iconic brands in the world. otherwise i wouldn't have done it harley-davidson is one of the few brands if you get opportunity, you certainly don't say no. >> first, how are you measuring success? >> qualitative and quantitative metrics that are important to us in the past we were market share driven we didn't look at profitability, we looked at market share primarily, and that essentially led to a lot of promotion of our bikes. so we discounted our bikes for several years just to keep the market share up and that was unsustainable, and we changed that and put desirability as the overarching goal. >> you are standing up an ev line, a stand alone brand for ele electric motorcycles walk us through that process, and who you expect to attract with that line of bikes.

>> electrification is a given. the future will be electrified, also in motorcycling it might take longer in certain segments such as the traditional harley-davidson segments, certainly because technology is not there in terms of range and longevity, in our touring customers wants, and the live wire product that we launched a couple of years ago, another harley-davidson brand, model name live war was focused and geared to what's the urban consumer, so i felt there was a huge opportunity as we are bridging into electric long-term, to use the live wire, which is the best product out there, best electric product, but focusing more on an urban customer to actually segment that out and stand it up as its own brand. >> these are the conversations we're having with a lot of companies right now, the fact that you're seeing rising material costs, supply chain and transportation bottlenecks, some companies have issuing finding enough workers what are you experiencing at

harley right now. >> certainly, when you think work is in our factories and distributions centers, that is challenging. getting people to work in our factories right now, in york and pennsylvania, and in milwaukee as well. so that has been a challenge but, you know, people love to work for harley davidson, i think we pay very well too but in the pandemic, people can choose now because everyone is scrambling to hire workers and that has been a challenge for sure other than that, you know, i think we can tap into a big labor pool around the world, and we haven't had challenges, you know, hiring key positions at all, quite the opposite. i think people see this as a huge opportunity, and you know, being flexible in terms of working in the office or not working in office or living somewhere else, you know, allows you much measure flexibility from a hiring perspective. >> just looking around the globe right now, how would you assess

the trade situation from your vantage point and what would you expect that to continue to evolve into? >> well, first of all, it's good that the trade tariffs didn't escalate further and the trade war between europe and the u.s. didn't escalate further. that decision was made some time ago, actually, a little over a month ago, and now with the president going to europe and meeting european governments and the eu as well, i think there is definitely a sense that there's no point in fighting over tariffs, and i believe that a solution will be found might take a little bit of time. that's the signalis we're gettin out of brussels, still work to be done. we're certainly hopeful that something positive will come out of it. there is just no reason why these should be in place, and certainly no reason why you would single out harley-davidson

as one motorcycle manufacturing that cannot import into you other than paying 35% tariffs. makes no sense because european manufacturers don't pay essentially no tariffs importing into the u.s. so that's just not right. it's not fair. and that needs to be solved quickly. >> it was a wide ranging interview, scott zeitz just by way of background was the man who was starting back in the '90s, turned around puma, brought it back from the brink of bankruptcy, built it into this sports apparel and goods empire as well, so he is not shy when it comes to a good old fashioned turn around or reinvention of a company that being said, you know, he's doing some things that some of his predecessors did not do before, especially when you think about competition, and one of them is embracing the used bike market, which analysts will tell you is arguably the biggest competition to harley-davidson retail sales is that used bike

market, and he says, i don't think why that's been the case, we need to embrace this. these are harley riders, this boosts the brand that was one piece of it also the fact that they launched a new bike, called the pan american, an adventure touring bike, and strong reception so far. >> i was interested in what he had to say about the evs it's a tricky thing for a motorcycle company like harley where you literally can hear a noise, you know, hundreds of yards away, and in your head, you're like, that's a harley, it sounds like a harley, and the live wire makes a little bit of sound, not the same traditional sound so it's different to think about an ev motorcycle, especially a harley, versus an actual traditional car, truck, vehicle. >> very true, and i have personally overthe years come in contact with live wire, it's more of a purr than a roar i would say. that goes back to why i asked the question who specifically they're looking to cater to when

it comes to this ev bike line, and i think it's a key reason it's being stood up as its own brand as they not only continue to cater to and be loyal to that core customer base but also expand the ridership demographics along those lines, folks will say, heavy weight motorcycles, this is an industry in secular decline. he balked at that. it will be interesting to see how the turn around strategy progresses and takes root. the last couple of quarters of earnings have been stronger than analysts predicted. >> he said a soundless ev motorcycle is just not on the table for us it's impossible. you can't do it if you're making hogs, no way good stuff. >> thanks. >> after the break, esg, it's a booming investing just a buzz word, we're going to discuss that next. plus, microsoft naming ceo, satya nadella as new chairman,

the first time someone has held both positions since bill gate quk t seet" is back in three ♪all by yourself.♪ you look a little lost. i can't find my hotel. oh. oh!

♪♪ this is not normal. no. ♪♪ so? ♪♪ right? go with us and find millions of flexible options, all in our app. expedia. it matters who you travel with.

the ipo and direct listing market reaching records this year, and it's only june tcwnhatoers break do wt wah on tradingnation.cnbc.com. more "squawk on the street" coming up. risk, and all the ways schwab can help me invest. this is andy reminding me how i can keep my investing costs low and that there's no fee to work with him. here's me learning about schwab's satisfaction guarantee. accountability, i like it. so, yeah. andy and i made a good plan. find your own andy at schwab. a modern approach to wealth management. wondering what actually goes into your multivitamin? at new chapter, find your own andy at schwab. its' innovation, organic ingredients, and fermentation. fermentation? yes. formulated to help you body really truly absorb the natural goodness.

new chapter. wellness, well done. stay restless, with the icon that does the same. the rx crafted by lexus. lease the 2021 rx 350 for $449 a month for 36 months. experience amazing at your lexus dealer. esg investing has taken the investing world by storm but there are a lot of questions about the rules of the road. digging through the data and is with us live this morning. good morning >> esg, there's still no standard definition, and various rating firms manage to assign a score to companies on their esg performance, money pours into stocks that get good raites, the ratings use are almost comically variant. the ratings between six well known rating stars, like morning star, and governance that's

circled right now, there's barrel an agreement on what it means. in other words, one firm's ratings opinion, i should say, is no guidance at all in guessing at all what another's will be. let's take facebook, for example, and their environment al score which can vary among ratings providers, high at 0.77 with one, and low being 0.23, different methodologies were used to create the final score in the same year for facebook. "wall street journal" research shows esg stock performance really depending on who rates them for example, those stocks defined by refinitiv think the worst of the bunch on esg metrics have rallied over 20% since the start of 2021, while the stop rated esg companies according to sustainalytics gained 26% over the same period. if you were following the esg data and avoided companies with the worst scores, you could have potentially missed out on

massive financial gains. all of the research shows two things, ratings can lead to inconsistent stock performance and passive investing may not be the best way to encourage good behavior just yet, but a crack down could be coming as both the s.e.c. and the u.k. government said they're both looking into better defining green investing and creating industry standards. let's see how long it takes. morgan >> and we know you'll be all over it. kristina, thanks for joining us. drones, artificial intelligence, and more, we're going to chat the latest with the defense tech srtta up anduril with the fix figure funding round. that is right after this break really dy truly absorb the natural goodness. new chapter. wellness, well done.

i'm dad's greatest sandcastle - and greatest memory! but even i'm not as memorable as eating turkey hill chocolate peanut butter cup ice cream with real cocoa. well, that's the way the sandcastle crumbles. you can't beat turkey hill memories. at cdw, we get your it staff has be ready to take on new challenges. that's why we built an office obstacle course ... to prepare our people for anything. you're late well, cdw amplified services experts will consult with you to design, orchestrate and manage your most complex technologies to help you quickly overcome any obstacle ... without all of this. oh, that is better. who's that? oh, if you want coffee, you gotta get past tantrum. you're in for a brewed awakening. for technology that moves you forward, trust cdw amplified services

it's moving day. and while her friends are doing the heavy lifting, jess is busy moving her xfinity internet and tv services. it only takes about a minute.

wait, a minute? but what have you been doing for the last two hours? ...delegating? oh, good one. move your xfinity services without breaking a sweat. xfinity makes moving easy. go online to transfer your services in about a minute. get started today. threadup today after keybank reiterated overweight rating on the stock and raised price target $10 to $32 a share. look that gain more than 13 pe%. on a tear since publicar mch "squawk on the street" is back in just a moment.

this is dr. arnold t. petsworth, he's the owner of petsworth vetworld. business was steady, but then an influx of new four-legged friends changed everything. dr. petsworth welcomed these new patients. the only problem? more appointments meant he needed more space. that's when dr. petsworth turned to his american express business card, which offers spending potential that's built for his changing business needs. he used his card to furnish a new exam room and everyone was happy. get the card built for business. by american express. wondering what actually goes into your multivitamin? at new chapter, its' innovation, organic ingredients, and fermentation. fermentation? yes. formulated to help you body really truly absorb the natural goodness. new chapter. wellness, well done. (♪ ♪) whether it's a technology first, (♪ ♪) a fashion first, (♪ ♪) a science first,

(♪ ♪) or a first for us all (♪ ♪) whatever you hope to achieve for your business, cloud first helps you get to value...first (♪ ♪) let there be change accenture what happens when we welcome change? we can transform our workforce overnight out of convenience, or necessity. we can explore uncharted waters, and not only make new discoveries, but get there faster, with better outcomes. with app, cloud and anywhere workspace solutions, vmware helps companies navigate change-- meeting them where they are, and getting them where they want to be. faster. vmware. welcome change. do you struggle with occasional nerve aches in your hands or feet? try nervivenerve relief from the world's #1 selling nerve care company. nervive contains alpha lipoic acid to relieve occasional nerve aches, weakness and discomfort. try nervivenerve relief.

welcome back to "squawk on the street." defense start-up anduril industries announcing a defunding round valuing the company over 4.5 billion dollars or more than double the company's previous valuation in july 2020. joining us to discuss, co-founder and executive chairman congratulations on the funding round and thanks for being back

on the show. >> yeah. thanks to for having me. good to see you. >> what will this money enable anduril to do? >> our vision become the next major defense prime and we're working towards transforming capabilities for the war fighter, and this will enable us to both continue to grow the team and could continue to increase what we're building and potential companies to join forces with or private programs that maybe we wouldn't have resources to work on before we're excited to explore now. >> yeah. i want to get into that joint forces piece of the puzzle, but first i just want to take a look at some of the key projects and programs that you have under onbelts. a bin years ago for anduril,

crisis at the border and money dedicated to border wall clawed back and reallocated by this administration but still a push for a smart border, virtual wall, if will you. how does that position anduril for future business? >> the biden administration has been incredibly clear since even before the election, approach to border security. tech enabled leverage modern technology to provide security in a way that doesn't involve just building a big 30-plus-foot wall. we have been in great position awesome relationship with cbp and excited about the work we're doing there with leveraging computer vision to provide them with capabilities they need to advance forward with the security mission. >> in terms of that mission, how accurate is your system? and i ask that, because we've seen other technologies over the decades where the border is concerned. what makes yours different, and

why is this the moment now >> no. that's a great question, actually there have been a number of efforts that have taken place over the last 20 years to build border security technology surveillance towers, things like that oftentimes the problem hasn't necessarily been that the programs have failed just because they've been mismanaged. it's actually because the technology wasn't quite ready yet. improved batteries and improved commute and better sensor. in addition, the software that runs all of it as a company, we're incredibly focused bringing together the skill sets that haven't been brought together before. talked before, morgan, most working on the computer vision problems are optimizing apps on google and facebook. our goal, create a company, aspirational, come to and work on critical problems with international and international significance doing that in a way that

leverages the importance of these missions to deliver that capability is an incredible telling sell from a recruiting perspective as well. >> yeah. seen explosion of defense start-ups. albeit many, anduril the exception, still very small. talking about the next gen capabilities and technologies, lockheed martin as well. how would you assess the current defense sector right now the competitive environment? and when you talk about the possibility to maybe collaborate or work with other companies, would you work with some of those existing primes like a loc lockheed >> yeah. two parts to that answer the first is, we feel a tremendous amount of pride and pressure, anduril, with kind of leading the way for new defense technology companies that are getting venture funding and starting to work with innovative groups within the department of defense. we're starting to see a lot more private investment flowing into these companies. we're super excited to work with them on the defense prime side of things, it's kind of maybe a slightly different story

my thesis, roughly that the people that love the defense primes most of the chinese communist party. they know we're slow not impressed with our capabilities know we have a difficult time delivering, and we're trying to build a company that operates on internet time, not jurassic time and you know, there's a lot of talk now about big tech antitrusts, but i think it would be really interesting to take a look at the defense industry and ask some of those same questions. >> wow that's, i think, the sector equivalent of smack talk there quickly, the fact your partners, a blisteringly strong year in terms of all companies the vc firm invested in, going public and in many ways very successfully how would you, i guess, assess the pipeline and the current investing landscape overall? >> oh, wow we had an incredible year at founders fund. a bunch of companies that have had their initial public

offering that's been an exciting thing to watch. as far as the vc landscape in general, shouldn't be a surprise to anyone the market is incredibly frothy making it a different environment than just a couple years ago i think in any economic cycle, really interesting companies great companies that would want to be in front of and want to be partnered with, but it's definitely a more competitive, a frothier and a higher priced environment than in a really long time. >> trea stephens thanks for joining us today. >> thanks, morgan. take care. that does it for "squawk on the street." scott, great to have you here again today. "techcheck" starts now.