"squawk box" begins right now. good morning welcome to "squawk box" here on cnbc i'm becky quick and we have joined by stephanie link i'm thrilled to be here. good to see you. let's see what is happening with the equity futures on friday, you saw the dow and s&p 500 close at new highs nasdaq within 1% of the all-time high if you check it out, there is a big back dow futures off by 82 points nasdaq down by 27. s&p indicated down by close to 10 points. we have some breaking news on

the fed this morning steve liesman has the news about what the fed might be doing with the asset purchases. steve? >> reporter: good morning, becky. shifting policy views as a result of the unexpected economic data. opened the door for federal reserve to potentially announce in september to taper asset purchases. tapering a month or so after interviews show growing support for faster taper timeline than markets expected than a month ago. the changing views follow the strong jobs data and higher inflation. the potential taper time there isline it looks like this centered around november or december taper beginning in october or november depending on how much advanced notice. last month, consensus was

december or january. a taper lasting eight to ten months clearing the way for potential rate hikes no decision has been made pending the meeting and vote the committee could delay the announcement until november especially with data numbers are weak or new lockdowns. fed chair jay powell did not f foresee a large impact from delta variant. at the same time, powell said he thought the spike would prove transitory and the fed was away from the substantial progress needed to taper. hold on, those comments came before the july jobs report beat expectations and producer prices double the street consensus. focus is the jackson hole speech where he could set the table for the announcement becky. >> the huge question, steve.

i think as recently as last week, people were not thinking he would speak about this at jackson hole if this is already out and the signal a week and a half or so before jackson hole, it would be hard to avoid this conversation. we should remind people you are talking about $80 billion in treasury the fed is purchasing every month and mortgage backed securities it is the mortgage backed securities where they would pull back sooner. the purchases are starting demand no demand needed with the housing market >> i think that's right. more support on the fed for bringing down the mortgage backed quicker than treasury i don't have information on how that is going to pan out we are, by the way, going to talk to eric rosengren at 4:30 we can ask him that question now you you are right in the sense that if the cat is out of

the bag and the fed will announce the taper in september, the question is how do they do it and when do they start it and the timetable? eight-month taper is more aggr aggressive a 12-month taper is less aggressive. >> let's talk about the fed and where it has been at this point. the reason they are reluctant to start pulling back about tapering maybe that ties back to 2013 the taper-tantrum. bernancke said maybe it is time to pull back some of this. the market started to pitch a fit. it feels like a different scenario this time around. >> i think that is right i think the fed knows that, becky. if you look at the idea that we have been talking about taper for three months now and that is something the fed is talking about it the fed acknowledged talking about it in june and july.

the talk of the taper is out there. you cannot avoid that. the market has reacted with some equinimity becky, the fed wants one thing it wants the market to divorce the idea of tapering and rate hikes. that is how the market is re rea reacting since the taper talk is out, the market is up there bonds are volatile yields are low i think part of the reason why we're getting more signals the september announcement is possible is the fed feels like it is overcome the issue number one with the taper that looks to be off the table at least for now. >> let's ask stephanie link. you are playing the market he have day is this different from 2013? >> i think it is i think the economy is really rebo rebounded nicely

why are they talking about tapering that's because the economy is more than on the mend. we got the cpi and ppi last week they were hot. beyond that, the non-farm payroll was great. wages up 4%. savings rate 12% i know confidence numbers were weak the confidence numbers were better than the university of michigan the one thing i look at which is an indicator is new orders in ism. they are north of 60 for 13 consecutive months i think we can taper i think we raise rates. this is a big surprise steve, they changed their view of inflation being transitory? i said it is not all transitory.

part of it is. steve, have they changed their mind on the inflation narrative? >> the best way to talk about the fed talki about transitory s this they thought it would be transitory and then transitory now they think it is transitory. which means i think they believe that the inflation problem is probably going to linger into next year. if you listen to the rhetoric. we would be clear by the fall. oh, we are clear by next year. now we are hearing is some folks think, you know, some time into next year. i think that lit a fire, stephanie. the producer price index came in strong that spoke to price pressure down the road. the two strong jobs report we are on the way. if we get another one in august, another strong jobs report will clear the landing field for the fed to take off. >> stephanie, you are surprised

by the timing on this. you won't guess that based on the action we are watching in the futures. we should look at treasuries dow hasn't budged. >> it is benign. rates are 127 and 136 last week. let's see. this isn't in the marketplace. steve just cut this story out there. i think i was not expecting them to change their tune powell was really steadfast in saying inflation is transitory we're going it take our time kind of thing. for them to comment next week is going to be interesting. maybe that's when the markets starts to react. >> kelly >> stephanie >> yeah. >> go ahead, steve >> i'm sorry i would make one more quick comment. the progression of this has been, you know, an evenly rising slope. they started telling us in may. in june, they started talking about it in july, the intensity of the

talks increased. last week was a very big week. we had a bunch of folks come out who are not your typical hawks caplan can go either way b b b bullard. important people came out telling us >> charlie evans said stuff that surprised me, too. he said he thinks we will see substantial further progress last year. charlie evans is the furthest thing from a hawk. >> what has happened, becky, the yardsticks come in like this we're at the earliest possible beginning. for you folks on the radio, i'm moving my hands closer together. the narrow is where we are right now. >> watching through you this steve, if you had to bet on it at this point, i know as

recently as a week ago, you didn't think they would do this at jackson hole. this changes everything? >> let's be clear about the process. that is important for setting market expectations. the fed cannot do anything at jackson hole they could have an emergency meeting. >> it is hard to not talk about it >> they will talk about it right. actual taper requires a meeting and they have to make a vote you notice that tapering is part of the statement right. it means it is part of the actual responsibility of the committee. that meeting is in mid-september. that is now where expectations point to when the taper will be announced. perhaps beginning in october perhaps november >> would the next jobs data that the jobs numbers for august we get at the beginning of september change things?

if it continues the trend, that is one thing have we seen enough at this point that it would really take a big decline on a lot of places before that would change the sentiment? >> i think you have to be dealing with a weak report there is an expectation of a strong jobs report especially with what happens to september. the schools hopefully reopen and unemployment benefits for everybody, extended benefits run out. that is cements a belief we will have very large jobs reports job gains in the next couple months. >> and powell narrowing the window by saying the economic impact from the delta variant will be all that big that would be the one wild card? >> that was the initial comment he made, becky good point he said we're learning to live with this. what i'm hearing from various fed officials publicly, they are

not seeing the big lockdowns the other issue, becky, over the past 16 months, if you look at the economy, we found a way to keep demand up stephanie made a lot of money with that idea that consumer demand has remained robust during the pandemic. it is supply that's the problem. robert caplan from the dallas fed. qe or asset purchase do not help with the supply of the economy we need to get the engines in the factories running in the economy and qe doesn't do that asset purchases don't do that. they can keep up ydemand we don't have a demand problem pandemic or not. >> fed doesn't have tools when it comes with help to supply. >> right maybe they can call up a freighter and say get going.

maybe make a phone call. >> steve, thank you for the breaking news. we will talk about it throughout the morning. when we come back, we will take another look at the futures. they are pointing to a weaker open dow futures indicated off 108 points s&p indicated down by 12 dow and s&p closed at record highs on friday. nasdaq closed at less than 1% from its all-time high indicated down by 35 points. when we come back, we will get you ready for a busy week of retail numbers. time for whale watching this morning. new filings from the biggest investors. we'll show you the latest portfolio moves right after this quick break. ♪ ♪ it's a wishlist on wheels. a choice that requires no explanation. it's where safe and daring seamlessly intersect. it's understated, yet over-delivers.

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welcome back timefor the squawk planner it is retail week. we get july retail sales tomorrow we get housing starts on wednesday. jobless claims on thursday on the earnings front, home depot annnd walmart report tomorrow on friday, deere and foot locker looking to wrap up a much stronger than expected earnings season becky. >> i can't wait. on the agenda, the 13 f filings due today.

reveal big position moves from the investors. joining us now for a little whale watching is leslie picker. >> reporter: good morning, becky. this is the deadline to report for the second quarter we have seen a slew of filing out friday biontech and moderna the holdings that were disclosed were as of june 30th if they remained unchanged, that is a big if, coatue would remain on moderna alone thanks to the run-up in the stock. the post filed on friday boosting stakes in facebook and micron to $500 million in each of the names starboard, soros disclosing on

friday away from major moves broadly speaking, it is clear many of the hedge funds are taking money off the spac table. it was during q2 that the s.e.c. caused the draw down of spacs. we will see more filing today and tonight and one from berkshire. these positions are as of the end of june. they may have changed in the last six weeks >> a lot of things changing in the last six weeks it doesn't sound like there is a lot of pull back people looking to put additional funds which is the mood of the markets sd s markets. >> reporter: that was the theme of berkshire they sold about $5 billion of equity $4 billion sold in the first

quarter of the year. we're looking at where the equity was sold with net sales for them that was a theme during the first quarter. i expect that to continue. s >> leslie, thank you we will check back in with you with more filings. we have our guest host this morning stephanie link as well as alicia. alicia, i don't know if you heard our last block where steve was talking about the fed timing that is breaking news this morning. i feel we all have been waiting to see when the fed would pull back the asset purchases >> good morning. i did hear it. it doesn't actually change what we have been thinking because we have thought that a series of

stronger jobs reports as we get closer to the unemployment insurance would lead to the fed tapers by december of this year. in the end, what hurts markets is the information you were not expecting. as you point out, this is waiting. markets are waiting for a signal whether a month early or later than expected. i don't expect that to change market pricing here. i think there will be some slowdown just on the strangeness of how delta acts and some precaution there ultimately, we see the taper starting by december of it this year. >> markets taper tantrum back in 2013 was different circumstances than right now unemployment is 5.4% inflation is hotter. the biggest reason for the longest time that people have said you have to invest in the

stock market is there is no alternative. this is the only place you can put your money or get a return what would tip that? tapering is pulling back some of the stimulus out there do you wait until the fed raises rates or does that change the picture? >> i don't think it changes the picture. ulti ultimately, yields are what is driving this there is no alternative story. the bond is yielding to the negative debt. there are forced buyers of the debt forced buyers of the debt have a natural lid of how high yields can go as a result, the best bet is still in the equity market even with the taper and even if we decouple rate hikes from the taper, we have a long way to go here and drawing up liquidity in the markets.

we are sloshing around for a long time and tapering back is not changing the story demand is enormous yields are low everywhere. you get return in the equity markets. >> alicia, can i ask you switching to earnings. earnings were good in the second quarter. i know 80% is not sustainable. 85% of the companies beat in the s&p. guidance was good. one of the things notable was the free cash flow generation. it was extraordinary what will companies do will we get a cap x cycle or are the companiies goiging to incre dividends or buy backs >> that's a good question. what are companies going to do with the cash? we think there is a cap x cycle coming here. the inventory discussion from

the earlier show really drives home the point that shelves are bare and inventory has to be restocked. with the cash, the cap x cycle in tech and goods as well. the bipartisan infrastructure bill is not so important for the macro story, but it will be important for certain industrial and material sectors you will see a boom there. it is interesting here outliar events make it very hard for wall street to model not only did we have a hard time modelling with the economy, but it turns out it is hard to model the earnings recovery when revenue is growing high and you made real streamlines of large corporations part of surviving the pandemic we saw the immediate drop to earnings that is moving forward i think you get cap x and investment and you get inventory build. >> alicia, thank you for joining us good to see you.

>> thank you >> take care still coming up, the fall of afghanistan. what the taliban takeover means for the u.s. standing and president biden's agenda. the senate majority leader is calling for a crackdown on fake covid i.d. cards. that's next here on "squawk box. ♪♪ ♪♪ jerry is here! j! mate, how are ya!? it's so good to see you. good to see all of you, yeah! why is jerry so... popular? it's been like this ever since we started using workday. what do you mean? it makes it easier to develop great relationships

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you look really lovely. frank? frank...i trusted you! but if cloning isn't right for you, just get posh. virtual receptionists who can answer and transfer your calls, because you can't be in two places at once. senate majority leader chuck schumer calling for a crackdown on fake covid vaccination cards. federal officials including the fbi needs to stop the fake flow of cards coming from overseas. >> there are now people manufacturing and selling fake covid cards although it's a

crime. this is incredible some people rather than get the vaccine, which is free, ar paying money for a fake card and risking prosecution because it is against the law who could be that dumb who could be that dumb >> schumer's demands follow the report by the ap explaining how people are cheating the system and causing concern at universities that require proof that students receive the vaccine to attend classes this fall i don't know i have an idea, guys, come up with a better system than cardboard piece of paper >> i don't know about you, but mine, when i got it, i thought i better not lose this i'm taking pictures of it. >> i sealed it up. why don't we have a national system that keeps track or a statewide system >> we have asked the questions since the pandemic broke the failure. the point that schumer was

making when he says why are people paying money to get a fake card. it is not the cost of the vaccine that is holding people back i just think you have to speak to where people are on the issue. it is not a cost thing. >> i know. it is not a cost thing it is people who are opposed to being told what to do with these things how about a better system instead of telling the fbi to stop people from making printouts and copies >> exactly i think apple with the latest. they are trying to advocate to have the driver's license in the wallet. >> we have technology abilities to do this the fact it is not getting done speaks to the lack of execution. >> or people's holdups about it. make it easy to get it, but is that a liberty issue we won't solve this right ow we will talk to gotlieb about it

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good morning welcome back to "squawk box" on monday morning we are looking at a pull back. dow indicated down 128 s&p futures are off 14 nasdaq indicated off by 47 this comes as we hear new news about the federal reserve potentially moving up the timeline of start tapering the purchases they have been making of treasuries and mortgage backed securities. the market is not reacting just yet. k ke kelly. the news or the news in afghanistan. it is looking bleaker by the hour over the weekend, the pentagon sent 6,000 troops to kabul to

secure the airport lawmakers pressed the administration on the failures of intelligence and fallout of the u.s. position in the world the collapse of afghanistan could take a toll on the biden administration agenda. here is a note overnight from bill blaine in the uk. he said the credibility went down over a shockingly fast timeframe. that has consequences for the future path of the dollar and monetary and economic dominance. dec diminishing the trump years to join against china j joining us is mick mulvaney. he is the founder of exogus capital. donna edwards is here with us as well great to have you here this morning. mick, i'll start with you, if i may. not to make you speak for the

trump administration, but a notable silence from top officials whether in the biden or obama or trump administration on the shocking shift events in afghanistan and the diminished stance the u.s. has in the world. chinese on social media saying the u.s. took 20 years in afghanistan. they were run out in 72 hours. what is your response? >> the chinese are asking the right questions. you mentioned it in the run-up to the segment where is the intelligence failure? we were told for years it was fine afghanis were told they were taking care of things and we would soon leave we got bad information from the pentagon it doesn't surprise me that was one of the subjects of the phone call yesterday you could make it a partisan thing if you want and some falls

to the biden administration on the execution of the plan. when the dust settles, one question is why was congress misled by the pentagon we spent 20 years and $80 billion training the afghanis. ten times that elsewhere in afghanistan and it fell apart in 72 hours >> to be clear, you are pointing the finger at the military and saying it is their fault saying this was an immense intelligence failure. >> i'm telling you what we were told what we were told. afghanis were close to being able to take care of themselves. that was not accaccurate it bears question why the information wasso wrong and wh people are so surprised that the country fell in 72 hours after 20 years >> one more question, donna, i'll bring you in

there was an understanding or you were told the afghans were ready to take care of themselves, i can't imagine people took that at face value you. there must have been a healthy dose of skepticism if that could ever be true, right? >> there is. i was one of the skeptics. i was they are not ready yet, but they are getting there it was never we have to stay forever which is what you see now. it would have been the honest answer what's the plan for the u.s. presence in afghanistan if they give an honest answer is we need to stay forever because the afghanis never take care of sthe themselves that's not what we heard from the pentagon >> donna, as disappointing as events are and as bad as the biden administration looks, there are people who watch and say why we should not be there stay there for another 20 years

or open-ended commitment was there a better way to extricate ourselves from the involvement? was it really that important to leave so quickly >> i'm not really sure there was a better way because frankly i will disagree a little bit with mick on this i think years ago, probably a decade ago, we knew that the afghan military and various fights where the united states was assisting would kind of give up at that time, the decision was made to put more money into training and technical assistance and advice. billions more. here we are another decade later and clearly the afghan military simply has not had the will to fight for its own country. i'm not sure whether this outcome would have taken place

if we had done a drawdown over several months or waited another year or another five years this, i think, was inevitable. i think one of the big miscalculations on afghanistan is we and our allies really tried to put in place a central government for a country that for generations and generations and thousands of years that existed in a tribal framework. it was like fitting a square peg into a round hole. it never really took hold. i think that it's tragic i feel for the women and girls who made advancements over the last 20 years that they now fall under taliban rule and it will be a disaster for them i agree with the biden administration that we cannot continue to be engaged in a

never-ending civil war in afghanistan. if the afghan people can't stand up and take care of themselves, the united states can't do it for them. >> final thought on this, mick, can you talk about what the strategic importance of afghanistan is we speak about it as if it exists in terms of russia and china. to all of the points that dodon was just making. >> i agree with much of what donna said it would have happened ten years ago or a year from now it looks like it was never going to end any way other than this do we have interests there certainly because of the lo location pakistan and whchina and russia

whether that justified staying there forever. maybe a small percentage of my party would make the casesayin it is in the national interest to stay forever. i don't think that is correct. i don't think that reflects the majority of my party there are interests there. no question. whether it justifies a permanent american presence, i don't think so we saw that over the weekend >> donna, are we fraying to the extreme? there is a difference to stay forever or make the matter worse in the way we exit >> we spent 20 years there i think president biden's policy as messy as it is is a reflection of where the american people are even a slow exit, essentially the afghan people have to stand up president ghani and others

protect and defend their own nation to the extent they are not able to do that, i don't know the united states can necessarily fill that gap. i think there are other ways we can look out for our geopolitical interests without the strong pilomilitary presenc. >> donna and mick, thank you when we come back, a travel deal in the works. we have the details next later, congress member josh gottheimer joins us to talk about the latest in washington to get the infrastructure bill passed remindreminder u n watch or listen to us anytime on the cnbc app. who can come to a stop with barely a bobble. lucia. who announces her intentions even if no one's there. and sgt moore. who leaves room for her room.

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leisure group for $2.7 billion they manage secrets and breathless resort spa chains sells vacation packages under apple brands it is owned by kkr it bought it from bain in 2017 becky. spacex taking another step toward space travel. elon musk tweeted the first stack of the rocket should be ready for flight in a few weeks pending regulatory approval. in may, spacex landed the prototype that could eventually carry astronauts and payloads to the moon and mars and even beyond. when we come back, businesses pushing back their dates for the return to offices. we'll talk about what it means for employees and how to at nt.es the chang th'sex nts] ♪ ♪ [grunts]

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the idea people have to be in the hospital has been debuchked in the last 18 months with the remote work world where people are asking for agency, they want flexibility. they want to manage where they work from home sometimes, oot the office sometimes, but not in

this fully controlled autocratic environment. >> i get that and definitely an employee's market. it's hard to get people to come in and do some of these things the one thing i say is that might change in the not too distant future if it does, will there be a turning tide at that point employers also have the issue with trying to manage people who have been allowed to work from home in the last 18 to 20 months versus those who have had to come in all the time it does put an additional burden on the people who are coming in and don't have any flexibility. >> you know, the nature of work has changed. what covid has done is it's accelerated the virtualization of work. so this idea that remote work is only here temporarily or an aberration is just not accurate. it's been accelerated.

work and -- digitally enabled work is what's upon us so we're not attached to space as we need -- as we have previously nor time. so this enduring change is what employers need to understand and lean into. it's not a matter of this is a temporary state, this is a matter people have experienced, seen, felt things that they've never done before and productivity has gone up in most places >> i wouldn't argue. i think you're right i think there were plenty of people who worked remotely and showed you don't need to commute into a city spending two hours of your day in travel and transit every day. it's just not everybody's work can be remote. it points to the bigger divide between the haves and have nots in some situations >> in some sense, yes, and remote work is not a panacea,

which is why most organizations even those you cite are moving to a hybrid format that combines some remote, some in person so that people get the best of both worlds and that's kind of the point where we're in right now in this evolution of work. >> we've seen google and some others talk about how if you're going to move to a cheaper location and stay there and be remote all the time, maybe they're going to pay you less than when you were in the bay area and not coming in does that make sense or giving an additional component. this is how global organizations have been the capitalist when they think about salaries. to pay people cost of living that's aligned with where they are makes complete sense but

organizations like google have to also think about the cost of working. people are giving up real estate in their homes, broadband. there's a lot of costs that individual employees are taking on in order to work so this is kind of a rebalancing act. as far as paying people to commute to come into the office, that's already embedded in the cost of living structure what's missing today is the cost of working from your home and we need to rebalance that. >> are there some industries that are doing better with this than others, some regions doing better than others >> i think some industries like the tech sector are doing better than others because they have much more experience that's the only reason, right? they have been experimenting with remote work for a very, very long time cisco started in 1993, so this idea of remote work is not only not new, there's a lot of wisdom and insight that we have from decades of experience.

it's just that the scale and magnitude has grown. h hubspot is doing this phenomenally well. they were right up front early january with their hybrid policies where they've thought through not only how do you think about remote workers but those who want to be digital nomads, want to work in different places and how a company can be flexible as well. >> because it's a marketplace as well with all of these employers competing. tseval, thank you for your time. we appreciate it. coming up, the taliban rapidly gains ground in afghanistan. we'll get a live report from overseas and new york city's vaccine mandate for indoor mandates and dr. scott ttibgole with that and more and you're watching "squawk box" on cnbc

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markets kicking off the new trading week near record highs. the biden administration defending its decision surrounding afghanistan as the taliban continues to rapidly gain ground there. we'll get a live report from overseas. plus, the push to get more americans vaccinated as the school year kicks off. we'll speak to former indiana

governor, mitch daniels. the second hour of "squawk box" begins right now good morning welcome back to "squawk box" here on cnbc i'm becky quick along with kelly evans. joe and andrew are off today joining us is stephanie link she's a cnbc contributor and it's great to have you both here thank you. >> thank you. >> let's check out the u.s. equity futures because on friday we did look at the s&p and dow closing at new records this morning there's a little bit of a pull back it looks like the dow futures are off by 83. we've been down triple digits which isn't bad when you consider we've closed at a record high. a lot of news hitting with afghanistan and with covid

new news with what the fed may be doing too nasdaq indicated off by 35 this morning. the s&p down close by 10 let's get you caught up on headlines. t-mobile is investigating claims that a hacker is trying to sell the personal data of more than 100 million customers. they say that a hacker on an online forum claimed to be selling names, social security numbers, phone numbers, driver's license numbers as well. if confirmed that breach could affect every t-mobile customer in the united states hyatt hotels plans to buy apple leisure group from kkr and ksl capital partners for $2.7 billion. apple leisure operates various resorts and spa chains and is under the cheapcaribbean.com and apple brands that would give hyatt the

biggest carriers to tropical places. gas prices went up three cents. average price for regular gas is around $3.25 a gallon. that's $1. it could be coming for those climbing gas prices to this point. >> all right senior economics reporter steve liesman joins us now with some new reporting on the fed's time line for tapering its asset purchases. steve. >> reporter: good morning, kelly. shifting policy views as a result of some unexpected economic data has opened the door for the federal reserve to announce in september a decision to taper its asset purchases and begin tapering a month or so thereafter interviews with officials along with public comments show growing support for a faster taper time line than markets had expected just a month ago. those changing views follow the strong jobs data of the past two months along with higher

inflation readings a new potential taper time line would look like this potentially. a taper announcement, last month market consensus had been around november or december the taper beginning in october or november depending on how much advanced notice the fed wants to give markets. that, again, is a couple months earlier than markets had expected then a tapering that lasts eight to ten months depending on how aggressive the fed wants to be and perhaps clearing the runway for eventual interest rate hikes. the committee could delay the announcement until november especially if august jobs numbers ends up being weak the delta variant could have lockdowns and inflation readings could be down. jay powell did not foresee a large economic impact from delta and that the fed should, quote, take seriously the risk, end quote, of higher inflation powell thought the inflation spike would provide true

transitory and the fed was, quote, some ways away from the substantial progress needed to taper. those comments came before the july jobs report, beat expectations and producer prices came in at double. the focus turns to powell's jackson hole speech where he could set the table for the september announcement >> steve, do you think it's fair to describe the reporting that you're talking about here. we're seeing stories in the wall street journal and elsewhere a lot of commentators will say, yes, we've felt the need for an earlier taper but it's a much bigger deal if powell himself or the fed consensus is there maybe that all changed after the latest jobs report, but this is a pretty significant development. are you surprised there's not a bigger reaction to markets >> i am surprised to some extent you're right though, we started off the week thinking that our report that ran bert cap lain,

together we interviewed him, kelly. i thought maybe robert was a little out there additional reporting showed that robert was perhaps -- you know, the dissenters can lead you astray or they can lead the way. i think in this case cap lain led the way. waller it depends who's saying what when you see guys like rose ngre was out there. he was such a dove that he started talking about the fed before anybody else buying corporate assets, right? >> wow. >> bullard was the guy who wouldn't forecast future rates so none of these guys are died in the wool hawks which you would take with a grain of salt. this is happening. i think the market is well prepared for it. i think what you're asking here is this. you're answering your own question which is did powell give the markets enough advanced notice well, this reporting combined with the market reaction i think suggests that he did

i went back -- guys in the back, if you could put up a two-year going back to june, my first story sort of saying the fed was on board with this idea of discussing taper came in early june since then the 2-year has added 6 basis points or 7 basis points it's really nothing. the market has been relatively -- has been expecting this look at that there's not that much there if you go from june it's 6 or 7 basis points total so the market has been expecting this and i think maybe the question in the market was, hey, why aren't you doing this sooner >> the larger question is how should we expect bond markets to react? is this like the taper tantrum where yields doubled in the span of a couple of months or the reverse of the taper, the risk on/risk off which is oh, my gosh as soon as they start to talk about the taper, stocks sell off, bond yields decline

an early read it would suggest a little bit softer on the yield front. >> you know, kelly, if i could, my producer, jackson burke, who has to read everything and watch everything along with me, he described a comment that powell made as the gun slinger comment where it was a kind of wanted -- when it comes to inflation, we will take it in dead or alive. you remember when powell said -- he goes we're not going to have a high inflation problem, and the reason is because inflation is either going to go away or we're going to do something about it i think what you might be seeing are two things there's a lot of artificial trade. that's one aspect of it. still the market has the ability to express its views on inflation. i think that's a market confidence that one way or the other, either through higher rates or through inflation coming down and other fed action the fed is going to take care of

the inflation. >> right one reason you stuck me in here, this has so many implications for which kind of trades are going to work. which way bond yields, financials this morning, huge questions. >> i think over time -- look, there have been several fed members that have been talking about tape perfecting for a while but i always thought it was powell's decision a the the end of the day he was really pretty focused on saying we're going stay the course so for him to turn, he clearly is spooked with cpi, ppi, even the prices paid indices that we've seen in some of the manufacturing series huge, huge numbers so i think even if the fed decides that they're going to talk about tape perfecting and then they taper and raise rates, i still think there's a little behind the curve and maybe that's what he's thinking too. who knows. >> that's the way the markets are thinking we're going to wake up and get powell changing his mind, okay, go ahead, and the dow is down 80 points

afghanistan -- >> i think the market is soft because of afghanistan quite frankly. it's a summer monday type of thing, right i can't wait until we stop talking about tapering we can taper we don't need emergency policy like has been put in place we can ease into it. let's see in terms of what does happen to rates, i think rates go higher with less fed intervention and it will be interesting to understand value versus growth, what happens to technology, that kind of thing. >> stef? >> steve >> i was going to say, stef, i think it matters to the market, i'm fascinated by your opinion remember we're talking about a taper, right taper means over a period of time the fed is going to reduce the amount of additions to its balance sheet. what does that mean? it means that in a month they did 120, the next month they will add to the balance sheet by 110 or $105 billion and the next month after that it will go down

to 95 or 90 billion adding to the balance sheet. what does that tell you? so we can game it out. that if they announce in september they start tapering in october, november, it means for another eight months the fed is still going to be adding a combination to the system. >> but the market is a forward looking indicator by 6, 8, 12 months, right? >> no, i get that. >> so we're seeing what's on the other side what's on the other side that's higher interest rates in my opinion unless they put the kibosh on the economy. i think there's an enormous amount of liquidity. we're about to get more infrastructure on the fiscal side i think there's plenty of ammunition in the system for the economy to keep chugging along and if the fed decides to taper and then they raise rates, i think we can handle it but the point is i think we're going to stay above trend in growth and that's why i think

rates could actually go higher. >> here's the weird thing. i think it's odd to characterize the markets this morning as weak because remember on friday, both the dow and the s&p 500 closed at a record high the nasdaq closed less than 1% from a new high and you're talking about a lot of news that's sitting out there, between afghanistan, between the fed tape perfecting, between what's happening with the delta variant and questions of whether that's going to pick up and eventually have some crimp on the economy. stephanie, my question is what makes the market come down if it's none of these factors, what makes it pull back from these incredibly high levels or all-time levels or is it those factors and the market a looks at it differently or tomorrow it matters or three months from now? >> as long as there's liquidity in the system, as much as we have, the dips can get bought. we can see a pull back i do think that gets bought at the end of the day so much liquidity, still

accommodative fed. even if they do raise rates, what are we talking about? let's put it into perspective. when i look at the economy, i see a little bit of inflation and i see interest rates that are actually we can handle it. that is kind of goldilocks in my opinion and that's good for equities. >> steve, for the -- >> becky, can i pick up on what stephanie was saying >> go ahead. >> quickly again, i want to talk about potential timing stephanie was on this idea then game ahead the idea of 10 months from now the fed ends taper and then it starts to employ a different criteria to figure out whether or not to raise interest rates right now the market is priced in for a rate hike, i don't know, end of next year the first quarter point rate hike the end of next year. >> right, a year and a half from now. >> that compares with the 2013, 2014 period where if you look at the 2-year note, it was always

in the 40, 50, 60 basis points it means under bernanke and yellen the market was always pricing in that extra quarter point rate hike a year or so down the road. powell has the 2-year down at 20 basis points which means we're not even suffering from the same anticipation. >> maybe that's the question, stef you don't think this is transitory is there a point where they say we need to move this up and maybe that's something the market can pay attention to. >> that's what i was going to say, becky if the cpi and ppi continue to be this hot, if wages continue to be this hot, 4% analnualizedi a big number we just saw he changed his mind in terms of jackson hole, right? we'll have to wait and see about

inflation. shelter costs are a problem. >> maybe this is the least action that the market might have anticipated or expected from the fed given the incredibly strong numbers from the jobs report, inflation numbers, maybe this is the least that they could possibly do given all that strong data anyway, steve, thank you we'll check in with you a little later this morning stephanie is our guest host and she's with us for the rest of the show. when we come back, the president of afghanistan fleeing the country as taliban forces take kabul we'll get the latest from the region after the break. before we head to the break, the markets say the dow is down, only off by 88 points. s&p down by just over 10 the nasdaq off by 40 "squawk box" will be rig bk.htac which saved investors over $1.5 billion last year. that's decision tech.

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becky, make no mistake, we are witnessing an historic moment in afghanistan. what's interesting is the situation at kabul airport right now where we're seeing reports

of mass gatherings on the ground afghan citizens ultimately attempting to flee the country what we've seen is vision on social media showing scenes of total desperation. this is people clamoring around a moving u.s. air force jet. some holding on in desperation and others running alongside we've seen vision of people climbing on air bridges and equipment in an attempt to board flights. earlier today nbc news reported that shots were being fired so clearly. a worsening security situation on the ground in the capitol kabul which is effectively under taliban control. stunning images emerging just i the past 24 hours from the presidential palace with armed taliban fighters able to make their way inside the palace as the taliban effectively took control of kabul that of course came after cnbc in the middle east was able to confirm the afghan president had effectively left the building. as that took place we know the

u.s. has also been working to protect and evacuate staff members in the u.s. embassy in kabul. it's been mostly cleared out president biden has also moved to deploy more troops to protect american assets and personnel there, about 6,000 new troops in fact of course, all of this coming as new questions circle about america's involvement in this 20-year long engagement in afghanistan. some describing this as aivi et namm moment for president biden and at the same time an embarrassing end to america's longest war. some key questions to ask here, how did the western intelligence community under estimate the taliban's ability to regain afghanistan. how are world powers going to respond with an emergency session of the u.n. security council getting underway in three hours time no doubt we'll hear from world leaders out of that meeting. back over to you, kelly. >> dan, thank you very much. joining us to discuss the

developing situation is evelyn farkas it's great to have you here. we spoke with mick mulvaney talking about what he thought was a failure of intelligence during the trump administration. coming from the military that they basically missed this they he have debtly told u.s. officials that the afghans were close to being able to take care of themselves. what would you add from your experience in the obama administration was your own assessment of the fragility of the situation and the options on the table forex iting it >> kelly, from what i'm hearing and what i know having worked in afghan nisistan and then in the obama administration helping with the u.s. european command and beyond that, what i -- what we've known all along is that

this wasn't going to be a victory. you know, that ultimately the taliban had a lot of leverage, political and military leverage, so it was always going to come down be to some kind of deal with the taliban so the intelligence community wasn't completely off because they had been warning that there might be a collapse and apparently according to media reports, you know, they said that the taliban now more recently they were saying would take over the government the issue was the speed and i think the reason they couldn't quite, you know, predict that was because political developments were changing on the ground and in washington, right? i mean, basically president trump when he left government had this crazy deal where it was unilateral between u.s. government and the taliban no real role for the afghan government, the legitimate, internationally recognized government and the withdrawal date was the 1st the biden administration came in and said, okay, we need more time

let's push it out to august 31st they started rapidly decreasing wut having a plan in terms of the collapse of the government, the political military will of the fighting forces and that's i think what we missed we missed the fact that we needed more time and a sense that we were going to be there for them in some fashion because ultimately they lost confidence. >> yeah. obviously the biden administration wants to say it's the trump administration's fault and so on and so forth their own words, it's coming back to haunt them with the vietnam references what happens now we are already seeing political moves out of china saying i don't want to put it too strongly, but they are kind of open to the taliban, you know, looking for new direction for afghanistan. my point being as we look at

the map here, there are many analysts who say china's ultimate goal here is oil pipe lines. they could run an oil pipeline through afghanistan, all of a sudden be in the gulf or be in some of the key oil producing middle countries and strategically it gives them more heft in the world in which they've been seeking how does this all end? >> well, i mean, china may like oil pipeline but it's an incredibly unstable territory to run any kind of construction and pipeline route now they are worried about insurgent activity coming back into china from the uighurs who use force, who use terrorist tactics to get back at the chinese government and to try to achieve some autonomy for the uighurs inside of china the chinese government is worried about terrorism. all of the countries should be

worried about terrorism. pakistan first and foremost. we should be worried there was always a worry that they would use afghanistan as a staging grouped. pakistan is a very unstable neighbor the border between pakistan and afghanistan is for terrorists open season. unfortunately pakistan is a nuclear power, 160 nuclear warheads there as well as nuclear material we, the united states, never like to see a situation where that might be at risk. >> the scenario you're painting is one where the u.s. presence in afghanistan is a balancing factor becomes very important and obviously the administration's just voted with its feet and said despite all the concerns you're describing, they're gone >> right i think the problem is, you know, look, again, if the taliban were going to prevail,

we were going to have to leave the question was how much stability could be negotiated at the end of the day in afghanistan? how much room for human rights observance on the part of the taliban might have been negotiated we might have gotten more time to see what the taliban would give the women i'm not going to be polyannish it wouldn't have been a good story. the women probably would have had to leave afghanistan but we could have given them a little more time and space to leave safely. >> yeah. yeah absolutely evelyn, we really appreciate you joining us to talk about it this morning. thank you. evelyn farkas. when we come back, the delta variant and getting back to school purdue university president and former governor of indiana mitch daniels will join us to talk about what they are doing. "squawk box" will be right back.

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welcome back to "squawk box. i'm dominic chu. there's been an interesting development over the course of the last few months, perhaps even year to date period where many of the stocks that aren't the largest in the s&p 500 have assumed some kind of a

leadership role since the pandemic lows even many of those value oriented stocks and sectors have come to the front of the fold. if you look at one etf that tracks the equal weighted s&p 500 no one large tech company dominates versus the overall cap weighted s&p 500 the gap was fairly narrow to start the year and it got larger during the course of the summer months it's closed up a little bit right now. the interesting thing will be whether or not those types of smaller value oriented companies will continue to really show some leadership in this market that's one trend trader we're watching right now on the cryptocurrency side of things the bitcoin surge has been massive over the course of the last couple of months here since the interday lows that we saw somewhat here around the mid june area, we've run up roughly 63% in bitcoin prices depending on what measure you want to look at still, with a 47 handle, 47,500, watch names like coinbase and

micro strategy in the premarket strategy they could get a bid on the bitcoin prices downgrade from shares of chi chipotle chipotle shares on a year-to-date basis up 36%. analysts at raymond james have downgraded this from a buy rating strong buy to outperform they raised the target price from $2.25 they still like the company. becky, still, i don't know if you have or not, but many people have changed the way that they order and do takeout for delivery, food, everything else. chipotle has been a huge beneficiary of some of those trends. >> i've changed a few ways that i do things. dom, i want to throw one more trend at you i know you can roll with one more thing dow had the best week since may. now they're 7% from the all-time high they've been in correction

territory before do you think that's telling us anything or is that a reflection of energy being so weak? >> it could be that, too some get a tailwind from some of the energy costs one they're watching is the severe under performance of the dow transportation companies with regard to the overall market trend a lot of the technicians and traders aren't as worried about that transportation theme as much as they have been in the past they are looking at things like airline specifically for that. that may be some of the covid delta variant playing out. the down trend, still solidly in this little down trend that we've seen in the course of the last four to five months f. it does continue and if small cap stocks continue to fade, maybe that's cause for worry right now it doesn't seem like the transportation stocks are worrying that many traders for the time being. >> dom, you are the best. >> i'm here to help you. >> every morning and you would know the answer. >> i'm here to help. >> thank you, dom.

mitch daniels on keeping students safe amid all of these covid concerns as schools reopen for the fall semester. plus, congressman josh gottheimer on the latest efforts to get the infrastructure bill passed talk to him about that, s.a.l.t., afghanistan, a lot of things on the move and we will hit all of those issues. stay tuned you're watching "squawk box" and this is cnbc ♪ ♪ ♪ more diverse thinking leads to more unexpected, more thoughtful solutions. ♪ ♪

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gentleman as the fall semester kicks off, we have mitch daniels here to talk about the delta variant and covid. this year purdue university is expected to have the largest ever incoming class with more than 10,000 freshmen bringing their total number of students this year to a record 47,000 mitch, it's great to see you today. thanks for being here. >> hi, becky. >> what's happening? where do things stand right now? you're not requiring vaccinations but what have you seen in terms of the number of students who are getting vaccinated before they come? >> seen tremendous cooperation

we as of this morning with a week to go, 84% of those students who are living on campus have shown proof of vaccination and about 85% of our faculty so we're in a good place and gaining on it but we're leaving nothing to chance. all those who have chosen or will choose not to be vaccinated have chosen instead to be tested on a weekly basis. they'll have to show proof of a negative test right before they get here so we hope to get off to a smooth start, but until we know that, we'll take no -- we'll leave no precaution untaken. >> you didn't take the same step that your rival indiana university did they're requiring vaccinations for all students the supreme court chose not to go ahead and hear that, to listen to it what do you think of their approach versus yours? >> there's really little or no

difference their mandate is not very mandatory. it's an honor system we are requiring proof of vaccination. not just an a tttestation we are creating the safest environment while leaving room for personal responsibility. again, people can choose to be tested weekly if they for some reason don't want the vaccine at this point, but what we're focused on as always here at purdue is the results and right now 84% and climbing they look encouraging. >> you know, i think we all were kind of hoping that this year would be very different than last and with the vaccination out there, it might be but i have to admit watching covid cases climb just as we're getting ready for kids to go back to school has caused me

some anxiety how about you? >> of course one thing however, becky, we watched very carefully last year for some reason other people seem not to pay as much attention is severity. that's what i'm really most concerned about. and we had a 6 point scale that our medical people put together. one, asymptomatic. 6, candidate for hospitalization. only 1%, less than 1% of the 60 some hundred cases we had all year last year ever got past level 4. that's what we'll be watching carefully. we'll do all we can to control the spread the thing that would concern us the most deeply is if any member of our community was getting seriously ill. on the new variant, we so far have not seen that that's a substantially greater risk but we won't know until we know. >> last year the cases you did have, i don't think any of them came from the classroom. where was the spread what was taking place?

i know you were working closely with the community, too, outside of just the student population but working with the surrounding town and trying to make sure there were safe areas there. sfwhapd what did lead to the cases? >> the safest place to be in our entire county was in a purdue classroom. that took a lot of work and incredible leadership and commitment by our students no, over half our cases came in the sort of congregant living. this is could-op houses, sororities and fraternities. nothing to do, no one was misbehaving. we weren't throwing parties in violation of our requests. simply the architecture of those places, common bathrooms, so forth, made it hard to control of the cases we did have, high concentration came from there. we've worked very, very hard on that trying to get ready for this year and have a very high vaccination rate in those

facilities >> what will this year look like versus last year because students last year, i know some freshmen from last year who just didn't really have the same experience is this year going to be like a traditional experience there will be mask wearing required inside but will there be gatherings like there were last year? >> it will be as close to normal experience as we can make possible we were the most open school our size in the country last year but, still, 30 to 40% of our classes were remote or hybrid. this year we think we'll have 80 plus percent of our classes in person indoor masking until we know -- until we decide that maybe that's not necessary so it won't be 100% pre 2020 we know and we believe and have data that says in-person experience is still a very important part of a full post

secondary education. we're a heavily science and stem-based school. we need students in laboratories we'll have to take precautions if we're going to make certain the quality of that education is as high as it's been at purdue. >> when you say you're not in favor of mandates, you do believe in personal responsibility i know that's not lip service. i know you take that very seriously and you move to ensure that students are doing that you're a former governor. what do you think? what would you be doing differently or the same as some of the governors you see out there? >> i'm very reluctant to second guess. one thing, becky, we have learned is that this virus manifests itself in different ways, in different places, different times and i do think it's important that we maintain flexibility for states and localities to deal with the facts right in front of them

but, you know, clearly leadership for vaccination, trying to reassure people who have doubts that this is far and away the very best choice for them in almost every circumstance and then as we i think had -- have here at purdue suggested, certainly in this very unusual environment, people are compressed together in large numbers hundreds of times a day, say, listen, your personal health is your own responsibility here's the information we think is relevant. you share a responsibility to keep it going, keep it open for the benefit of everybody our students, faculty, staff have embraced that here and i hope that in communities nationwide a similar appeal might help. >> i guess i get to the point where i know you don't want to second guess people, but i do think you take this very seriously again even though you don't necessarily believe in requiring vaccinations for

everyone if a business or industry, say the cruise industry, wanted to ask all of their passengers ahead of time being vaccinated >> no, i wouldn't have a problem with that. as i just mentioned, circumstances are different. a cruise ship is a very different place than, you know, just an average neighborhood as i just said, a university of our size is a very different place and i think that one has to take the -- apply the policies that seem best most likely to be for the good of all and meanwhile appeal as effectively as one can to every member of that community to pitch in it doesn't work without that kind of cooperation. >> one of the things that you did was try and get students excited about it by offering free tuition to ten students, free tuition to ten students who agree to get vaccinated. how do you think that drummed up

excitement >> it helped we'll never know exactly what the incremental benefit was. on the day we announced it, something like 60% of our students we thought were vaccinated, we're now in the 80s. we know there was an immediate surge of people registering their status right after that incentive became known no, we had some fun with it. you know, our mascot and our signature train. >> boiler maker. >> showed up at the house of winners. you know, it -- our appeal still is, listen, we expect you to leave purdue a responsible adult and making decisions for yourself and accepting the consequences here this year this will mean that if you choose a path other than vaccination and, you know, you get sick, you'll need to deal with your own quarantine most likely and, you know, we

will be here to help, but it will have been your choice and you'll be responsible for what happens. >> mitch, it's great to see you. we appreciate your time and want to wish you the best of luck as the school year kicks off there. again, mitch daniels who's the president of purdue university >> so interesting. coming up, stocks are ready to kick off a new week of trading with the dow and s&p hovering just off of record highs. check out bitcoin this morning it's adding 2.5% 47,500 as we continue to see fresh records in terms of market caps set for the bitcoin and market space $2 trillion and counting we'rba ia mee ckn mont throwing things at me? look, as cfo it's my job to be ready for whatever's next. that's why i have my finance team, randomly hurl things at me. it's also why we use workday. it gives us insights, so we quickly pivot our strategy, people, planning, you name it. sorry, sir. i will aim straight at your next step.

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news just out on tesla the u.s. national highway traffic safety administration has opened a probe of tesla's auto pilot function. they say the investigation will assess technologies and methods that are used to monitor, assist and enforce the driver's engagement tesla's is a little different than what you see from gm and some of the others where they have to make sure their hands are always on the wheel. that stock off by 1.9%

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welcome back, everybody. steve liesman has been reporting, shifting policy views as a result of the unexpectedly strong economic data has opened the door for the fed to decide to taper assets and purchases that would follow a month or so after. let's talk a little bit more about the implications from markets. victor jones is here from tasty trade.

it's good to have you. we were all remarking this morning about how you get a major headline like this, especially in a time of geopolitical uncertainty why are people telling us no, no, no, powell is different. he's not on board with this more hawkish taper yet. evidently he is. >> markets are waking up a bit it's telling you to expect even on a large move 1% on a daily basis. last week we moved 44 points throughout the week. that's less than 1% an entire week you do have this week is option expiration you might see more volatility here realized volatility is near 10%. you have the vix telling you to expect 17% it's through the floor 10% i think there's a couple of ways to think about that.

portfolio insurance is really, really cheap two, if you want to continue to realize in the money call premium is relatively cheap. you can sell out of the money premium against it that's a lot of what we've been talking about over the week. >> i want to ask you a strategy question though you can take it sort of how you would see markets reacting to it talk to me about infrastructure for a moment we have people saying the debacle in afghanistan could diminish the other agenda items, the most obvious being infrastructure we'll speak to the congressman in a moment about the effort he's leading as well my question for you is how important to you is fiscal policy started by talking about monetary policy. what about fiscal policy when it comes to the expectations and general sort of calm environment you're describing the markets in. >> we're going to trade the volatility we see. how important is it? it's important for the fact that, look, the markets have priced this in for a long time

but we haven't gotten a deal done we're getting to the 20 to 15 yard line. i'm not quite certain that pushing this out additional negotiation is necessarily going to add additional volatility into the market. there's a bunch of known/unknowns, whether that's the taper time line, infrastructure package, geopolitical, the market is taking it in relative stride here even equity risk they're signaling a slowdown in growth but there's almost this -- there is no alternative place. where do you want to be here do you want to be in cash? do you want to be in bonds do you want to be in china or some emerging markets given what's happening on the dollar for most, the answer is no you see reluctant participation from u.s. equity participants. i don't see anything that's happening as a reason to shake people out of that position. >> victor, it's stephanie link you mentioned cash

there's 4.8 trillion in money markets right now, money market funds. i'm wondering, do you think that's bullish do you think there's pent up demand coming into the markets or is that on the sidelines where everyone is uncertain about delta, peak growth and all of the other issues? >> i think it's definitely possible here. i think where we are with, you know, many analysts raising their expectations here, 46, 4700 in the s&p 500, you are slowly grinding higher you haven't seen the participation in the russell in the s&p and nasdaq, it's definitely a possibility for them to come off the sidelines and start to participate we haven't seen it to the extent most people would have thought i think a lot of people are out here calling for 10 to 15% corrections. the problem is when you have a lot of people expecting 10 to 15%, you have people buying at down sides you don't get the corrections as expected

if you get any weakness here, i think you'll definitely see cash being put to work. >> victor, final question. you know, do you have any thoughts about the bond market here and the inner play between yields and equities? especially as you focus more on the taper coming up? >> yeah, sure. the relationship with nasdaq has been largely intact here in other words, when interest rates are moving higher, you see a little bit of pressure moving on the nasdaq. the russell has a two engine plane. one of those engines isstartin to die down. the russell is holding 2200 here it was sort of elevated by crude oil as well as interest rates moving higher. even though interest rates are moving higher you're seeing crude oil a little bit dead here at 68, 66 range. i think that's starting to weigh on the russell even though you're seeing interest rates move higher, you haven't seen the participation in the russell that you might

have seen a month or two as we were oscillating from 150 to 175 in the 10-year. >> thank you for having me >> stephanie is sticking around. when we come back, new jersey congressman josh gottheimer will join us to talk about the latest efforts in washington to try to get the infrastructure bill passed this is a doozy. it puts the house speaker, nancy pelosi, in a bit of a box. plus, we're also going to iatod arkets with mohameel ern get you ready for the week ahead stay tuned, you're watching "squawk box" and this is cnbc.

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the taliban take control of the country and the u.s. scrambles to get americans out a live report with the latest is just moments away. back at home, the growing uncertainty of whether democrats can get a trillion dollar infrastructure deal over the finish line thanks to an even larger budget blueprint. we'll speak with the problem

solvers caucus chair the final hour of "squawk box" begins right now good morning welcome back to "squawk box" here on cnbc i'm becky quick along with kelly evans and hightower chief investment strategist and cnbc contributor stephanie link joe and andrew are off today i'm very glad to have the ladies with me. ladies, thank you. >> thank you >> let's check out what's been happening on the market this monday morning red arrows the dow is indicated down triple digits decline of 110 points. that's coming off of a record close on friday. same story with the s&p 500. it also closed at a record on friday indicated down by 14 points this morning. then you have the nasdaq which was only off 1% from the all-time high. it's indicated down by 54.

there's been a lot of news over the weekend. you saw what's happening with afghanistan. also watching the covid count and seeing what happens with the fed. federal reserve, going to talk about this, all of that news going to bring the futures down 130 points to the dow. the treasury market, you'll see that there hasn't been a huge shift in the treasuries either 10-year note, 1.27%. the 2-year sitting at 0.25%. >> here are some of the stories investors will be talking about today. first off, bitcoin and some of the other coins trading higher bitcoin broke to 48,000 over the weekend. according to coin market cap that helped push the value of the entire crypto universe back above $2 trillion. wireless carrier t-mobile says it's investigating claims in the online forum of a data breach involving information of more than 100 million users

this doesn't mention t-mobile by name but vice media said the data came from their servers. shares of smart speaker maker sonos are surging after an itc judge ruled that google infringed on some of sonos's audio technology package this could lead to an import ban. sonos shares are just off a 10% gain. let's get to the developing story in afghanistan as the taliban seizes control of the country and the united states scrambles to evacuate personnel. we have more from tehran. >> reporter: hey, becky. there are scenes of panic and pandemonium at kabul airport as desperate people pour on to the rub way trying to flee the country in what can only be described as a chaotic exodus. people are literally clinging on to u.s. military aircraft as they try to take off the u.s. is in charge of the

airport there but their focus is on the evacuation of american personnel. as far as commercial flights go, it's a disorderly mess with little security and the commercial flights are currently not running. we know that as of last night the u.s. military had flown around 500 embassy personnel out of the country on military aircraft they're working up to a capacity of several thousand a day. they won't have that capability for a few days to come as for the afghans that have worked in various roles for the u.s., it's going to be a much tougher journey to get out of the country. as i mentioned, commercial flights are problematic. thousands are stranded at the airport and whatever else they could gather getting to the airport means having to run a very dangerous gauntlet that could cost them their lives. they're also reported, nbc news

can't confirm, that five people have been killed at the airport. it's unclear under what circumstances. could have been gunfire, could have been a stampede but it's so chaotic there the details are only dripping out as the day unfolds. >> ali, we have watched that video of the afghan citizens kind of surrounding the military transport plane and trying to grasp onto the sides of it we've watched that again and again this morning i just wonder, what happened do you know what the end result was? the plane can't take off like this did they pull it aside >> no. one of the planes actually took off and there was also some very disturbing video that's emerged of people falling out of the wheel hub of the airplane after it had taken off most of the planes were grounded because they simply couldn't take off because there was a stampede of people on the runway, literally as the video showed clinging onto the plane so a lot of them had to be

grounded and then the u.s. army then had to form a perimeter around the runway to stop people coming -- pouring onto the runway and they had to fire warning shots in the air to disperse people. it's a real mess there and you can see that the afghan people who are obviously not supporters of the taliban are desperate to find a way out of that country, even resorting to clinging on the wheels of airplanes. >> you mentioned how dangerous it is even to try and make the run to get out i guess that -- if you look like you are trying to get away, obviously you're not a supporter and that puts you at incredible risk >> exactly one of the problems there, becky, is the u.s. had said to afghans that have been helping u.s. personnel and have granted the visas, they say come to kabul airport, we'll evacuate you. the problem with that is a lot

of these people are in far flung areas and they couldn't get from a corner of the country to kabul and they simply couldn't go by roads with their families because it was too dangerous if the taliban caught them, at best they would be detained and at worst they would be killed. it was a dangerous gauntlet that they have to run through the country which many of them were unable to do and r now in hiding totally unaware of what the future holds for them as the taliban has now totally overrun the country. >> and at this point i would guess that it's too late to do anything else because of that situation, the taliban taking over >> reporter: it is it's becoming -- the window is closing incredibly quickly there are some embassy staff, the british ambassador is trying to issue visas to some of the afghans that helped the british embassy there. he said it himself in very frank

words. he goes -- he said that they are not going to be able to evacuate many of the people that worked for them and then they're going have to try and do it through a third country at a later point which is going to be almost impossible for afghans that are in afghanistan the taliban are not going to allow them to move. >> heartbreaking to watch. ali, thank you ali arruzzi is with nbc in tehran. let'sget to the latest in the evident to try to pass the infrastructure bill in washington new jersey congressman josh gottheimer is leading 9 house democrats calling on their obsown speaker to let them vote on one package before they deal with the other. in a letter this week, with the livelihoods of hard working american families at stake, we simply can't afford months of unnecessary delays and risks

squandering this once in a century bipartisan infrastructure package it's time to get shovels in the ground and people to work. congressman gottheimer joins us this morning he's the co-chair of the problem solvers caucus josh, you guys are living up to your name at this point trying to solve a pretty big problem. this had to be a move that leadership was not anticipating. what have you heard back >> well, thanks for having me. as you pointed out, this is critically important that we get this done and that we don't wait months and risk squandering this opportunity. you're talking about 2 million jobs a year. fixing roads, bridges, rail, a gateway tunnel between new york and new jersey built not to mention all of the policies with the climate, electric vehicles and broadband. what we fear is if we wait months this will never get done. the president said when the president passed this incredible bipartisan piece of legislation, he said, the president, let's get it to my desk as soon as

possible we believe the path forward here is let's vote on this. let's vote on it this month and we can move on with considering other information including the budget reconciliation and we believe that's the best path forward for the country built on momentum you have great support from labor and the chamber of commerce let's seize on this opportunity now. >> let's back this up for anybody who wasn't watching the politics closely as this played out. the senate went ahead and passed the bipartisan deal. the president said he would sign it nancy pelosi, because of pressure from the far left wing of her caucus, said she wouldn't go ahead and move that forward unless and until the other part of the infrastructure deal was passed again, $3.5 trillion the human side of the infrastructure it was the left wing saying we're not going to allow this to happen unless we get everything we want. >> exactly. >> you have the moderates

saying, okay, hold on, we want this to get passed this way. that puts nancy pelosi in a very difficult spot she only holds the majority by three votes, by three seats. if she has both ends of the party squeezing her, what happens? >> i think the smarter solution here is to do exactly what they did in the senate. you said that very well, becky not wait for the next piece of legislation. what they said was let's vote now on the infrastructure package, which they did. 19 republican senators and bernie sanders voted for this historic bhuns in a century bipartisan structure of legislation. then they moved to consider and voted on the budget which works on the reconciliation. the size and scope, we'll still debate that. they presented it as 3.5 trillion there are lots of things there, the revenue side of that the target spending, make sure that's the right levels and

programs, that's the next debate we can have. they did it in that order for a great reason we have a great win sitting here for the countries, get the shovels in the ground, not wait. not risk waiting months. this could take months to consider the next reconciliation package. they said, let's get this done now. all we're saying to the speaker is let's follow that same course i'm not sure why my colleagues are standing in the way of that and want to obstruct the president's agenda this is what the president said, get it to my desk as soon as possible there's a lot of support from what i'm hearing back home let's get that done and move onto the next piece of legislation to consider and we can have that debate. >> what reaction did you get from the speaker's office? i guess from the one side this could look like you're putting her in a very difficult position from another, you could be helping her out if she wants to pass this legislation too and says to the left wing of her caucus, hey, we have to do this,

there's no other way around it >> i think this is about helping the country out and helping the party out. we're all going to look good -- >> what did they say what was the reaction you got from the speaker's office? >> i think she's looking for a solution we've been talking about it. frankly, based on all of my conversations, i'm not getting into all of the details with leadership and others, but the outcome is we'll find a solution we'll talk this through and work it out we're going to get it done for the country and the president. i'm optimistic we'll figure this out. i think it's very important that we don't back off of this pathowhich is voting first on infrastructure and then considering the budget resolution and there's enough of us who really feel strongly about that that we're going to hold to our guns here and we'll figure out a solution. >> let me press a little bit further. this is not you saying that if we get the infrastructure deal i

will then sign off on the $3.5 trillion package this is you saying i will then consider it and maybe make some compromises and look for something at that point, correct? >> right that's a great point you're raising. the reconciliation process has two steps. first you vote for something called the budget resolution, think of it as the frame of the house. you sort of say this is going to be the approximate size and scope. in this case it's up to $3.5 trillion it sends orders to all of the committees to get to work. the committees are working on the programs, policies, potential revenue raisers that come with it then you spend time building the house and then you vote on the house which is called the reconciliation vote. this is all a debate about should we move forward with the budget reconciliation to get that going it's a procedural vote before we start that formally,

let's vote on infrastructure because the concern is when the reconciliation vote happens and some of my colleagues, some to the far left want to wait for that final vote which can take months until that's passed if they don't like everything, we're never going to vote for infrastructure that's the concern you have the afl-cio, chamber of commerce, business roundtable and all of the people at home saying, let's get going. we have in jersey 1/3 of the worst roads. the gateway tunnel is 113 years old. why would you actually not get those projects moving as quickly as possible and we could vote on that this week so all we've said is let's vote on that as soon as possible and then we can start that next process and have that debate and

decide what that should look like it's way too early to make commitments about that, becky. there's things like s.a.l.t. that are critically important that i want to see in there. you have to see the whole package. until you do it's hard to debate that. >> don't let the perfect be the enemy of the good? >> right with this once in a generation vote on infrastructure that democrats and republicans came around, that's pretty good as you would say, you question whether we could get that done, becky. everyone came together and did it >> josh, i will give you credit. you havebeen optimistic all th way along on this. i have been more pessimistic thinking something would trip it up now with what you're doing, if you're really flexing your muscle with it, i get it if this is the way you're going to say this is done, where would you say the stance the transportation stocks or anything related to infrastructure really popped

again last week even after all of the gains that we're thinking when you say you're optimistic you think there's a 90% chance this gets done at this point >> it gets voted on and signed into law >> i'm going higher than 90 on the infrastructure, on bipartisan, bicameral. i don't want to do anything to risk it not getting done and, you know, months of delay can do that, that's why we want to get it done now. i give a lot of people a lot of credit in the senate and the problem solvers caucus, everyone working together it is what the country wants and needs. the feedback has been so positive there's no reason we should hold this up. whether it's broadband, climate, water, this includes what we need as a country. i think we should get it done. becky, i'm going to be very optimistic and positive. this is last bumps in the road until we get it done. >> well put, congressman gottheimer

if new jersey is only the third worst roads, who has the worst >> i just focused on jersey. >> ah. okay great to see you, josh thank you for your time. >> want to fix your roads. >> there are lots of potholes out there that need to be fixed. try new york, too, right, kelly? >>. >> i think he's inventing the other two states new jersey is pretty bad. we'll bring you up to speed on a new federal investigation just announced into tesla's auto pilot feature and the spread of the delta variant. we'll be joined by dr. scott gottleib who's calling out the number of kids thahat ve caught covid. stay tuned, you're watching "squawk" on cnbc

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welcome back nhtsa is launching an investigation into tesla's auto pilot program. phil lebeau joins us with the details. how big of a deal is this, phil? >> reporter: it's a big deal this is a formal investigation that nhtsa has opened looking at tesla's auto pilot situation

it has identified 11 crashes involving tesla models where the auto pilot system failed to identify emergency vehicles or emergency signage on highways. those 11 crashes, according to nhtsa, were linked with 17 injuries or one death. this includes models s, x, y, 3 from 2020 through 2021 the formal investigation could take months, likely will take months at the end of that investigation what typically happens is nhtsa sits down with an automaker and they say, look, this is what we've found. one of two ways. if nhtsa believes there is a defect or something wrong with a particular card or system in a vehicle, they will say to the automaker, let's see how you can correct this issue a recall here. if the automaker says, you're wrong. we disagree, then nhtsa will have to go to court to say to a judge, we believe this automaker

should be compelled to recall these vehicles or this particular part or this particular piece of technology but we're a long ways from that. the significance is nhtsa has essentially been asleep at the wheel over the last five years when it comes to regulating vehicle safety there have been people within the u.s. government that say, look, these guys need to be much more diligent looking into situation, not just tesla but all automakers now that you have nhtsa now opening a formal investigation into the auto pilot system, this will give us a sense of what errors will be in there or if there's not a problem with the auto pilot system. there have been 31 investigations that nhtsa has responded to or incidents that

nhtsa has responded to now they'll open the formal investigation. by the way, we have not heard from tesla not a surprise they disbanded their media relations department you can bet we'll likely hear there elon musk, likely on his favorite venue, twitter. that's what we're waiting to see, guys. >> hey, phil, is there any reason to think that other automakers should be concerned about this, too? or is there such a significant difference in what gm and others actually require in terms of checking to make sure you are paying attention >> they're different systems, becky. the auto industry will say you have the investigators that will formally come out and say, here's what works, here's what doesn't work here is a problem with the tesla auto pilot and they could come back and say, a, b, c are situations or pieces of the technology that need to be

refined, worked on, et cetera. that's the significance here all automakers will be watching this closely. >> tesla shares down 1.25%. coming up, the supply chain kink that will be pushing up the school supply issues mohamed elhe errian will join us stay tuned you're watching "squawk box" on cnbc

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welcome back you can expect to pay more for your kids' school supplies this year the reason is largely courtesy of the massive containerships or trucks barrelling down the hig highway. frank holland joins us. >> reporter: good morning, kelly. back to school clothes will cost 77% more year over year and that is largely due to the increased cost of shipping your new outfit to the store or to your house. most of those clothes come from asia in containers the cost of shipping those containers to the u.s. west coast hit a record up more than 220% year over year trucking, that's how 80% of everything you buy gets to the store. those rates are at records 53% higher the ceo of knight swift, the

nation's largest trucker expects them to go higher. notebooks are 75% higher book bags 22% higher sneakers, 17% higher tv for a dorm room, 10% higher discounts are on the decline average discount in retail bass 13% last month the latest reading of inventory to sales ratio near a 10-year low. stores are stocking 18% less of what you want to buy than they were just a year ago some of that is due to shipping costs. also some is due to storage costs. it's historically low 14% vacancy rate and rents have increased 10% year over year emerging problem cvre forecasts they will continue to rise throughout the end of the year. overall it means you will pay 40% more for back to school shopping than you did in 2020.

becky, back over to you. >> frank, thank you. i hate to see it but, yeah, doesn't surprise me i have to say after watching all of this. when we come back, former fda commissioner dr. scott gottleib will join us to analyze the delta variant. we are seeing kids and 30 somethings infected even as they have booster shots for vulnerable americans we'll go through all of it when "squawk box" comes right back. g. yeah...uh... doug? sorry about that. umm... what...its...um... you alright? [sigh] [ding] never settle with power e*trade. it has powerful, easy-to-use tools to help you find opportunities, 24/7 support when you need answers plus some of the lowest options and futures contract prices around. don't get mad. get e*trade and start trading today.

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welcome back to "squawk box. hospitalizations of children hit a high more than 1900 kids. scott gottleib is saying health officials, they aren't even collecting nearly enough data on cases of young age groups. he's with us he's cnbc contributor. his new book "uncontrolled spread, why covid-19 crushed us and how we can defeat the next pandemic" is coming out in september. thanks for your time let's start with the issue of kids in particular 1900 isn't a huge number it's still awful you're saying it could be way underreported? >> well, the amount of infection

could be way underreported 1900 is eye lot of hospitalizations 27,000 pediatric hospital beds in the united states. >> we need to keep up the vaccinations. >> kids have been vaccinated a lot of kids 12 and above.

>> i think they need to talk to that there is some discretion you can take. the population ages 8 to 11. we're still thinking more from

the hospital school aged children only 8 to 11 >> hey, scott. what are you talking about. higher levels in the hospital. >> fda >> in the population.

>> they have to make the vaccine. >> there's a lot of flexibility. >> there is a situation and are you surprised on that.

the u.k., even israel, you've seen a decoupling between deaths and hospitalizations i think the decoupling in the u.s. is wired in what we're perceiving we're dramatically under diagnosing the amount of infection. many more people are being infected than are being diagnosed. if you figured that 1 in 10, 1 in 20 people are being infected with the delta variant, decoupling between deaths and hospitalizations is wider. i think the under count is greater. this is a critical question. you see a lot of kids getting hospitalized with the delta variant. is that what's driving the variants that's a critical question there's an assumption we're diagnosing one in four kids. i think it's much lower than that i think there's probably much more infection that we're picking up because it's mild or

asymptomatic. >> you talked about heard immunity being reached can we still get there does delta allow that? or is delta going to be a second wave that even if you've gotten the previous covid variant, that you could pick this one up instead and that kind of shuts off the idea of heard immunity? >> i don't think we'll ever reach true herd immunity i don't think the coronavirus allows for true herd immunity. i think what we're going to do is get population wide saturation after we get to the delta wave, there will be vaccination or immunity through prior infection. you'll see chains of transmission break off and the virus won't transfer the same rate the only thing that could change that equation if you see a variant come along that escapes

immunity the good news is we haven't seen newer variants emerge. the reality is the variants we're grappling or the ones we're tracking all emerged later than six months ago. it could be that the virus mutated very quickly over a short period of time it's reached a new quickness level. that was the presumption of a lot of people who study this, that this virus would start slowing down the rate of mutation hopefully we're not going to contend with an endless stream which is unlikely to be more contagious than the delta variant or start to evade immunity. >> i have one final question, dr. gottleib, related more to the booster shot at this point it sounds like they're recommending them for immunocompromised people but why not for everybody? >> we certainly should be considering booster shots for the elderly people people who live in congregant

facilities, also health care providers first to be vaccinated back in december and january, what we've seen is declining immunity over time more pronounced in an older population some of the most vulnerable people, elderly people were vaccinated first back in december, particularly the nursing home patients. vaccination in a nursing home takes time you can't go in there and you have to get consent s in place a lot of them don't have capacity to consent. so once the administration makes the decision to start vaccinating in nursing homes, it could take weeks and maybe even months to start going into the facilities we should be doing that, in my opinion, right now >> all right so much ground to cover as always dr. gottleib thanks for your time this morning. we do appreciate it. >> thanks a lot. when we come back, the growing support inside the fed for an earlier taper of hundreds of billions of dollars at central bank bond purchases.

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in september perhaps the decision to taper its asset purchases and begin tapering a month or so after. interviews with officials along with the public comments show growing support for the faster taper time line than markets had expected the changing views follow strong jobs data along with higher inflation readings here's the new potential taper time line being talked about taper announcement in september last month markets were looking at november or december for that announcement the taper beginning in october or november depends on how much advance notice the fed wants to give markets were talking about tease or january 2023. the tapering will last eight to tep months depending on how aggressive the fed wants to be in releasing the $120 billion the announcement could wait until november especially in

august jobs data ends up being weaker than expected maybe the delta variant sparks a round of losses. fed chair jay powell, he said he didn't foresee an economic downturn and the fed should take seriously higher inflation powell has yet to speak since the reports came out producer prices coming in at double the street consensus. focus now, powell's jackson hole speech we have eric rosengren, the boston fed president coming up at 4:30 p.m. we'll talk to him about all of these issues in the first on cnbc interview. >> a lot to look forward to. steve, thanks. let's bring in allianz and grammarcy adviser, mohamed el erian. if steve wants to stick around, we'll let him jump in.

mohamed, let's dig through this. i think it's a little surprising there's no market reaction today, but barry knapp sent a note out saying he wouldn't be surprised to see at some point a 10% reduction because of this, just because of the tightening nature of this, any tightening from the fed you do see some sort of reaction, at least generally with time. has this been so well telegraphed that there is none of that or is the market waiting until the fed says this instead of just coming at it this way? >> two issues, becky thank you for having me. one, why haven't we seen most of the reaction chair powell hasn't spoken the migration towards what i think is sensible, you've heard me say they've started tapering already, but this migration to let's get going is from below. it doesn't involve yet fed chair powell, new york fed president john williams nor rich clariter, the vice chair as long as the big three aren't

saying it, the market is not going to be listening to anything else. as to what the market does, i don't think you get a major collapse i think this is being socialized you will get some pull back, and you should, because we are at bubblish level in some places because of the massive liquidity. i don't think this is a collapse situation. this is a let's get more sober situation. >> the point was made earlier, too, mohamed, i think steve was the one who made this point, that, look, this is still an awful lot of accommodation and it's still going to be taking place for a very long time even if they do start to gently taper, maybe come october or november, ten months from now they'll still be basically buying some of these assets in an economy that's been improving greatly. i think if you look at the unemployment dropping to 5.4%, you look at the inflation that we've seen lately, maybe there are some who think, probably you too, that they should be doing much more than this and even

faster than they are telegraphing at this point >> yeah, that's what i think i've been there. i've kept on saying inflation is not transitory unless you define transitory as two to three years which makes it a meaningless concept. yeah, they should have started they had a window. they still have a window they should get moving so i am all there in terms of what they should be doing. as to the impact, look, the biggest risk to this economy or this market are either the big policy mistake, and that comes from not doing anything and then having to slam the brakes on later on or alternatively, market accident because you continue to fuel this liquidity and people are in the looking at fundamentals if you look at the big risk of the economy, it is that they do not taper because then you increase tremendously the not just probability but the high likelihood of this policy mistake. so they should get going and

they should have gotten going earlier. >> mohamed, how do you think corporations are going to respond? so year to date we've seen global m&a at $3.6 trillion. that's more than all of last year's 3.59 trillion do you think they pull back as the taper gets more serious or do you think they ca or do you think they can hang in there and they're going to continue to find shareholder value? >> and that's a really good point. you also could have pointed to bond issuance, we've had record bond issuance, including in high yields, so corporations have taken advantage of this massive liquidity. what we are likely to see is, again, more sober activities people are worried as to what's going on with some of these m&a's. they're worried about spacs what you may see is somewhat more sober activity. it's not a halt. it just makes it less bubblish. >> steve, what do you think? is this a situation where we can

kind of officially say that this is the fed's thinking at this point, or do we have to actually hear it from chairman powell at this point >> we have a pretty good feel for what fed thinking is right now. i think the issue may be more that mohammad had one aspect which i think makes sense to me, the idea that this is what the market thinks is needed. when you think about what the concerns are for the market, is it growth? is it high unemployment, or is it unfinflation and pricing? i think that's where the concern is, that last item there, it's inflation. in a perfect world, which we know this is not, a change in fed policy should be anticipated by the market. and i think that's exactly what's going on here i think powell's probably done a pretty good job here in terms of getting the market ready remember, he told us what he was going to do. he said he was going to do it, and then he kind of did it, and so this is where we are.

the markets had a lot of time to adjust to this if you haven't sold because you're concerned about tapering, then you've been a little like rip vanwinkle and asleep for a very long time >> i just want to ask you a quick follow-up about the taper and the role of powell and all the rest of it as much as we focus on the sort of guess game of which fed officials think what exactly, i'm just curious if you see this as sort of a bigger strategic shift. they're clearly laying the groundwork for it. we've got jackson hole coming up we sort of take it afrom there do we just wait until it's actually implemented for the bigger market action >> i think you wait until chair powell says it the market is still conditioned by the notion that the fed when push comes to shove, the fed will not taper

the fed will find an excuse to continue with the liquidity. why? because it has been so influenced by what happened in 2013 with the taper tantrum, what happened in the fourth quarter of 2018 when the fed was forced into a very embarrassing u-turn so the marketplace is not going to believe that a taper will take place until chair powell says it. does it come at jackson hole i don't think so it should. i think it's really important for the chair to regain control of the narrative otherwise he's going to have a very split fomc, and he does not want that. but i'm not so sure it comes at jackson hole i think it comes most likely in september as steve said. mohamed, steve, i want to thank you guys both for your time on this today i want to jump over to jim cramer down at the new york stock exchange, get his thoughts on the same issue. jim, what do you think the market has kind of shrugged off any of this. maybe it's just because it's not a huge move and maybe the least

that you would anticipate from the fed at this point. >> i think that the markets really deeply focused on both delta and what it's doing to slow the world down. and also trying to extrapolate what happened in afghanistan to taiwan and whether taiwan will look at their relationship with the united states and say, you know what, the united states doesn't offend its friends and then companies that need chips in china will get preference. remember, a lot of china's slowdown is the same thing we have, which is you can't get the chips. so why would the taiwanese -- why would taiwan semi necessarily go to us rather than china if they felt that the united states wasn't good for it >> that's a really interesting playout that we haven't talked about today, the implications on foreign policy and what that will mean back for business as well jay powell has said that he doesn't think delta will have a huge economic influence. what you just mentioned could be pretty key if we can't get the chips.

>> yeah, i mean, i just think that we're being oblivious when people say we don't defend our allies, i think that means if you're taiwan, i think you're wondering, i've got orders from the united states and orders from china i don't know if people are going to question the -- what the united states' commitment, let's sell those chips to china second, why won't the chinese do what's necessary eventually to take over taiwan i mean, that's what i felt when i saw those pictures we see pictures of guys hanging onto planes. that's even worse than picture of guys hanging onto helicopters in saigon. i don't know i think we have to be focused on taiwan it's too big now. >> i will say, though, with all of the headlines, we're talking about a pullback that's not a very big pullback, even with all of these things adding up. the dow and the s&p closed at new highs on friday. it's almost like there's nothing that shocks this market enough to say that we're not going to put money in >> you know, stephanie is so

good, she said look, there's 4 trillion on the sidelines just waiting for that 5% decline. just waiting for it. where is it? i think that that's the trampoline i know that there could be a taper tantrum. that money doesn't care about that that money's looking to get in the market on any break, and i think that that's what makes it so difficult to buy stocks here thinking that, well, maybe i should wait for the break, but then you never got in. maybe you don't get in. >> jim, thank you. we will see you in just a few minutes. >> up next, though, what you need to watch as we approach the opening bell on wall street. "squawk box" will be right back.

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let's take one more look at the markets this morning, dow futures down by 127. the nasdaq off by 57 the s&p down by 15, and stephanie link, that was quite a shoutout from jim cramer just the idea that there's so much money sitting on the sidelines. everybody's waiting for that pullback, and that's why it makes it waiting. >> i was trying to get a question in, i wanted to ask him about the rotation that's what pms have been focused on all year long, value to growth, growth to value, we shall see. i think higherrates are the positive for the value side. that's where i'd lean. >> we've also been watching

treasuries, the ten-year was sitting at 1.27% last time we checked at it. i think that's where it is right now too. stephanie, kelly, i want to thank you guys both for being here today this is like charlie's angels. >> thanks for having us. >> thank you so much that does it for us today, make sure you join us tomorrow, right now it's time for "squawk on the street." ♪ >> i guess that makes us bozly good monday morning, welcome to "squawk on the street. i'm carl quintanilla with jim cramer at the new york stock exchange, david faber has the morning off. futures are under the gun to start the week after the tramgic developments out of afghanistan. our road map is going to begin with the taper time line shifting policy views have potentially opened the door for the fed to announce it will begin tapering as early as september. the u.s. opens a