a reminder, cnbc's annual alpha conference on september 29th we will feature the biggest names in investing, politics, and corporate america. you can register today at deliveringalpha.com. the dow's up, guys, right now, andrew big show. really big shoe. >> that's the old sullivan show. great job, becky, great to see you. we'll see everyone tomorrow. "squawk on the street" is up good wednesday morning, welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber at the new york stock exchange. in a few moments, s.e.c. chair gary gensler is with us to discuss everything from crypto regulation to china to spacs to gamification and payment for order flow lots to get to with the chair. in the meantime, futures steady. china weakness is again on the radar. nice upside surprise from empire today at nearly twice the estimate, david. >> carl, yeah, we do have a

special show for our viewers today as we will devote our first half hour with s.e.c. chair gary gensler this follows his testimony before the senate banking committee yesterday. we have so many important issues to cover with the s.e.c. chair we're going to hope to move through sort of some of the following regulatory topics, crypto, robinhood, specifically, payment for order flow, the spac market china, of course concerns there as well or here over the vie structure that's used by so many u.s. listed chinese companies. want to get to the fallout from the meltdown of archegos, also esg. you can tell lots to do. with that let's bring in the s.e.c. chair, gary gensler chair gensler, appreciate your taking time with us, and your willingness hopefully to move through so many of those important topics with that, let me start with last week and crypto and this week of course you talked about it yesterday in your testimony in terms of answering questions as to whether some of these tokens should be regulated as securities last week brian armstrong, the

ceo of coinbase had some pretty pointed things to say in a tweet. i'll read the middle one here. he said they, and the they is you as in the s.e.c., refused to tell us why they think it's a security and instead subpoena a bunch of records from us we comply, and then tell us they'll be suing us if we proceed to launch with zero explanation as to why. love to get your response to that >> thank you for having me on your show. it's always good to be back. look, we have a set of investor protection laws in this country, a basic bargain that was laid out in the 1930swhere congress wanted to protect the public against fraud and other bad actors investors get to decide what to invest in as long as companies make full and fair disclosure. now, in those laws there's a very broad definition of what is a security in fact, it has like 35 different sub parts to it.

and the reason congress did that is they really wanted to protect investors against that fraud that can come up in the capital mar markets. and so cryptocurrencies has come along. i think the laws are clear, the case law, the supreme court's weighed in on this multiple times and that many of these tokens do come under securities law to the extent that a platform, alending platform or a trading platform, whether it's centralized or so-called decentralized, and i say so-called, has securities on it our investor protection regime is there to protect the public i think the public benefits from that, and that's what we're trying to do. >> are you actually, though, communicating with coinbase? again, back to this -- it's not often you see a ceo kind of criticize the s.e.c. in the way that mr. armstrong chose to. he said, you know, the s.e.c. responded by telling us the lend feature that they have is a

security okay seems strange how can lending be a security. we asked him to help us understand and share the view. we make an effort to work with them, and he indicates you have no interest in working with them is that true or is he lying? >> let me take it more to the generic if you'd understand why i'm not going to get into any one company or one token, but our s.e.c. staff talked to a lot of participants in this market, as we do in other markets as well and if they come in, ask a question, and i suggest they come in and something is a security, then work with us to get registered now, as it relates to lending products, lending products for a long time have been part of the securities law in fact, the first word -- and there's 30 or 35 things congress listed in 1930, was note a note, comma stock, comma bond, and it goes on and on. in 1990, the supreme court addressed themselves to what is

a note that comes under the securities law so i think that the law is clear. we do work with and talk to many companies and projects in this space. >> it's terrific to have you on the show jim cramer here. there's a thing that i know cftc you've had that job told me on "mad money." he thinks that tether, represents actually one of the great threats to the financial markets talking about how we've seen this movie before, sub prime derivatives, do you know anything about what's really in a $60 billion i don't know, security, asset, whatever, tether, doesn't that represent systemic risk to the american financial system >> i thought that your interview with tim was quite good and if i

can quote him, tim said that stablecoins are a bit like the chip at the casino where someone's going from gaming table to gaming table, and you see the $125 billion of st stablecoins that are in existence today are intertwined in the crypto lending and crypto training space 70, 80% of all the trading, whether it's bitcoin versus this or that is versus one of these stablecoins. as tim said, the chip at the gaming table that people are trading in and out of. and as chair powell even raised in recent testimony, they do have some attributes that look like money market funds, and i think that's what tim was talking about as well. >> well, mr. chairman, one of the things that confused me is the cfo of coinbase suggested that perhaps you don't have much knowledge about this area and you need to be educated. when i look at your background, i think that perhaps you have a

formative education in crypto, would you agree? >> well, i'm learning every day. i learned from the wonderful students and faculty at m.i.t. i was honored to be a professor there teaching in blockchain and crypto finance and the like, but i look forward to further engagement with the companies in this space and the market participants, and it's really about how we bring base investor protection to protect people against fraud and manipulation and this is an area that's been rife with fraud and abuse. >> chairman gensler, i think we're going to end many of these topics with this question for me which is, okay, when is the s.e.c. actually going to do something? so i'll start with crypto. when are you going to put into effect some of the things you've been indicating here that you're at least thinking about doing in terms of the regulations for this market? >> well, we're doing it right now. even chair clayton was doing it before me and the s.e.c.'s remarkable career staff.

we work with our federal regulators, and we both have authorities in the martskets and over the markets and to help protect the investors. we brought about six dozen enforcement cases to help protect investors in this space. we encourage the platforms to come in, properly register, work with us if we need to sort of sort through whether it's some of our laws written in bricks and mortar time, transfer agents i know your listeners aren't thinking about that, custody, maybe we have to adjust some things, but to work with us and to come inside to help this market, if this market's going to have any potential, it's not going to long survive outside of an investor protection framework. >> all right want to move on to another topic that we'd indicated, of course, which is payment for order flow involves robinhood certainly, given how important it is to

their business yesterday in your testimony you talked as well about orders competing with other orders. that was about competition, and perhaps citadel's place there since it's a very important part of this. one party buying literally half the retail flow in america these market orders you said, could actually diminish competition in the marketplace chair gensler, i'd love you to listen to a response as well from the virtu financial ceo specifically about you and what he had to say about you conflating some issues when it comes to order flow. >> he's conflating the issue of payment for order flow and the inherent conflict which has been addressed and dealt with by the last 30 years from the s.e.c two separate issues and the data around price improvement is so overwhelmingly compelling, $11 billion of price improvement in 2020. $11 billion and zero commission trading in this country. game, set, match.

>> your response >> well, let me just address, i don't think that the disclosures that are put out really addres the question about whether people are getting best execution. so best execution means best execution, and so we have something in america where nearly half of the trading is going to dark polls and to the whol wholesalers, one of whom you were just interviewing, wholesalers that dominate and concentrate the market and even that which is on the so-called lit markets, the new york stock exchange and nasdaq, many of the trades there are not being fully displayed. so this concept of price improvement is against a measuring stick which is a measuring stick that's not fully reflective of the market, and our consolidated take, our national best offer so to speak does not reflect the half in the dark markets

it doesn't even reflect a lot that's on the exchanges. so if you or i make a trade, a market order retail trade, where does it go 90 plus percent chance it dwgoes to a handful of wholesalers, one of who you were interviewing i would say that's a conflict. the thing that we're trying to do is update our markets for the 2020s. they were last seriously updated in 2005. a lot's changed in those 16 years. >> you know, mr. chairman, i want to follow up on that. this notion of payment for order flow and i understand what the virtu fellow said, isn't it true if brokers are optimizing their digital engagement practices for their own revenue, that may not be exactly on the same page of giving investors the best returns, so therefore investors should know ahead of time that they may not be getting their best returns by so-called paying no commissions >> jim, i thank you for that you're absolutely right.

so today's data analytics aren't what you and i learned in college. they're very sophisticated and they can optimize for the trading platformor the robo adviser to maximize their revenues and their data collection that may well be in conflict with your investor returns, when they're trying to use a behavioral prompt to get you to trade more or to move into one of their investment products secondly, you mentioned zero commission zero commission does not mean it's free to the retail public you may not be getting best execution, and so that's what our economists, that's what we're looking at very closely to see can we do better, and i think that we can do better than the regime that was laid out 16 years ago. >> you know, when we talk about regulation exposure to a number of new platforms in technology, not just in financial services. one thing we keep coming back to

is the popularity of the platforms creating friction for regulators is it any more difficult to regulate something that's popular? maybe because the client base does believe it is zero commission >> well, you raise a good point. technology's come along and changed the nature of finance. the internet came along, and that changed the nature of finance as well. so these are the challenges we have it natimakes it at an exciting . at the core, what we're trying to do is get competition in the market i mean, it's a basic thing in america. i'm deeply a markets person and believe in transparent trading and competition order by order competing. and right now we have large wholesalers buying a bunch of that order flow and so that the retail public, most of your trades are going to a small handful of host wholesalers, and

they've publicly a nounsed there's a high concentration among two or three of them >> mr. chair, on the subject of gamification, we were just looking at shares of amc, obviously we're talking about robinhood. i mean bs they're on college campuses encouraging students to open accounts, i think giving them maybe it's 15 bucks to do so i know from personal experience there's a lot of college students who are trading bitcoin on their phone, trading any number of these so-called meme stocks it's unclear they really understand about the market and the underlying fundamentals. is that a concern to you >> i think it's a positive that more americans are investing in the markets, but investing for the long run is different than trading daily or trading hour to hour on an app, and i would just say and you can go to investor.gov and see better details on this at the s.e.c.,

but that day trading often lowers your returns. but it's positive that more people are investing it's better to invest for the long run than try to day trade or even hourly trade. >> i've got to follow up on this i believe that some of these apps, let's just say robinhood, i think they maximize trading and volume, and that does not necessarily align with the customers' incentives. how do we teach the customer that >> well, i think that with certainly need to do collectively, the media, the s.e.c. and others, all we can do to help educate the public ultimately, the public has to decide what they invest in that's their basic bargain, but also we have the s.e.c. here to try to protect the public and what we're trying to do in terms of what you just said is if the application, the platform is maximizing and running an

algorithm in the background to maximize their revenues, whether it's a robo adviser or a trading app, that presents a potential conflict right there, and that's manager that congress long ago said to the s.e.c. to address those conflicts, and disclosure alone may not do it. it may not be good enough to say, hey, wec have a conflict, don't worry, we like you too it's really we have to address those conflicts and try to help the investing public out >> all right, i'm going to be sure about this. we know that justice bran dice said disclosure is the best disinfectant you are saying disclosure may not be enough when it comes to the so-called gamification that some of these organizations have i think in many ways robinhood is no different than draft kings if you've got $100. >> we've said this for decades, my predecessors republican and democrat alike we use the tools in the tool kit

that congress gave us. congress can change those tools, but those tools include disclosure, really poimportant, but we also are cops on the beat protecting the public when people are defrauded, and we do address some conflicts more specifically around our rule set, so we have a mix of tools disclosure as justice bran dice said is an important piece of it but not the only tool. >> i want to move on to spacs. yesterday chair gensler, you did say you're looking at greater disclosures and looking at their inherent conflicts i can tell you having followed this market quite closely. there certainly is a misalignment of incentives between sponsor and holder of spac shares. i can also tell you when it comes to at least disclosure recently i've been focused on reporting on redemption rates. we don't know sometimes what percentage of spac shares are being redeemed it's not something that is typically or always reported in a uniform fashion. let me just start there. is that a concern to you

because it would certainly seem to be material information investors should know. >> i think that there's a number of areas including, as you say, the redemptions. what a special purpose acquisition company is is basically a blank check company raising sometimes hundreds of millions or even billions of dollars and saying we will go find something in the next to years. bear with us we'll find something when we find something, there's a redemption and many of the institutional investors and hedge funds that are in there redeem out and the retail public might be left with a small portion of the company. >> yes, you might be left with a very small shareholder base. >> all of these -- >> thaet's right. all the fees them fall on them there's investment banking and lawyer fees and the like all along the way off the remaining

retail investment. >> yes, but also a lot less cash is left as you know. they put projections out initially when they announce the deal for a certain amount of cash that's going to come from the trust and typically from a pipe, and then we're left with cash numbers that are far, far below what they had anticipated. is that a concern for you at all? >> yes, and you mentioned a private investment in public equity or so-called pipe investors who come in later, and they too sometimes get to buy the at a discount. so the discounts they get, the bankers, the lawyers, the accountants is significant cost and the retail public that's still in is bearing the bulk of those costs. >> to follow up on that, in the case momentous and stable road that you brought, there is just out and out fraud, and i think it's getting people at safe harbor thinking listen, if we don't have out and out fraud we can make any projections we want

out to 2027. this has directly fooled many, many investors how to we keep the investors being fooled by phony projections? >> i've asked staff to make recommendations. we have a five-member commission, we'll put it out to the public, get notice, comment, and we'll see if we can finalize something on the issues you've raised better disclosure about all the fees better disclosure, as you said, with regard to these redemptions, and then you've just, jim, raised about forecasts and projections. and while we in the security space address it elsewhere, i think we need to through our rule writing also take that up here as a commission >> now, spac issuance has dropped off significantly. people seem to be getting the message. are you encouraged by that are you happy perhaps there are fewer spacs being not just taken public but doing deals, even though plenty are out there looking for deals? >> i think we industrstill haver

work cut out for us to put out through notice and comment better disclosure regimes, better regimes writ large with regard to acquisition companies. there's five to ten new of them a month. there's 400 that are still looking and shopping for acquisition targets. but whether there's one or there's 400, i think we can do a better job in terms of the disclosure and the protections for the retail investor. >> all right want to move on to china, we're getting limited time left here >> we're going to extend the time. >> we are? >> yeah, right now. >> has he agreed to that i don't think he knows -- >> chairman gensler wants to answer these questions >> jim, i am going to be running into something for -- in a handful of minutes, but why don't we talk about -- >> i'll give them a call, sir. this is just too good. >> all right, well you know, the vie structure, you've written about it a number of times, in fact, in an op-ed earlier this week in the

journal. how much of a concern is it to you, how much of what the s.e.c. is doing should be viewed in light of what the chinese regulators are doing as well >> so with regard to china related companies, and i say china-related because they're not all based there. many, many of these companies are based in the cayman islands. we have a number of issues number one was a basic bargain that we entered into in a bypass way about 20 years ago, paul sarbanks, mike oxly and george w. bush worked together to say if you're a public company in the u.s. your auditor has to be subject to auditing, basically audit the auditor, inspect the auditor. this is about trust in our capital markets. 50-plus jurisdictions have said, yep, you can do that, france, germany, switzerland, so forth two have not, china and hong kong so china weighed in again late last year and said, guess what, we'll give it three years but if

they can't do it these 200 plus companies that are china-related will have to step out of our listed markets and be suspended in trading two is because china has said for many years, decades, that foreign ownership is prohibited and technology, internet, and other spaces, the lawyers and accountants came up with a structure called variable interest entities where you actually do not invest in the china company. you invest in the caymans and that cayman company has a serseries of contracts that may or may not be enforceable under chinese law. there might not be any cash that's flowing from the chinese operating companies to the cayman companies and the ownership is still amongst friends, families and others in china. so we've said let's take a pause and get better disclosure, back to justice brandise, better disclose about that variable

entity -- variable interest entity structure, a cayman islands company needs to disclosure more about what's going on. >> thank heavens, we need that i speak to a lot of people about what happened in game stop, and sir, i get the sense that we both want the millions of people who have come in to be as educated and be as good as possible, but there's an angle, and the angle is if three hedge fund members work in concert to smash a short hedge fund, the 5 million reddit people would say that's legal and it props shouldn't be if 5 million people decide to smash a hedge fund that's short, is that okay what is within the bounds of what you can do to smash a short sell >> again, as i said earlier, i'm not going to speak to one specific company or issuer and so forth, but i think that people come on to your show and they advocate either to buy or

sell a security before we had television, people did it on radio. now we have various social media platforms. that's sort of -- that's not only free speech, but it's part of what makes our capital markets robust that people can disagree and disagree using the medium of the day. but i also think that we do police the markets for fraud, manipulation, for pump and dump schemes and the like, and that's the important role of the s.e.c. >> i want to try and get through all the topics we've outlined. let me end here with archegos. it's a long time ago that we learned of this family office few of us had heard of that owned perhaps as much as 25, 30% of viacom shares and discovery shares through total returns why haven't you done something to make that less opaque >> so total return swaps are something that is a broader

group called securities based swa swaps, that also includes credit swaps. credit swaps are part of the '08 crisis and then total return swaps were at the heart of not only these events but long-term capital management 24 years ago. we have done things at the s.e.c., and we're going to do more we have going live this november a twwhole regime that oversees e securities based swaps and makes more transparent not only to the regulators but starting next february to the public the transactions in the security swaps. in addition, i've asked staff for recommendations on how we can put out with the thought of archegos in mind, how we can put out aggregate information about the aggregate positions in

securities i think they're doing a lot, it's going alive in november and next february. we're going to be doing more with regard to agate disclosures. >> giving everything we've covered here, it's clear the s.e.c. has plenty of its plate do you have the resources to actually be effective as a regulator given all the challenges you're facing >> oh, we are short staffed. it might sound odd to say that at an agency with 4,300 remarkable dedicated staff working remotely during this pandemic that's 4 to 5% less than five years ago. we have an ipo boom, spac boom, cryptocurrencies to deal with, we had the issues we talked about earlier about china issues and the like, and our capital markets are 100 plus trillion dollars, about half of that is the stock market a little over half is the bond mrkt so i'd like to at least get back to where we were in 2016, and i think we should probably be 5 or

10% larger than that. >> chair gensler, we have an opening bell, we certainly appreciate your spending so much time with us this morning. >> you all stay well, your families and you stay safe in these challenging times. >> we will >> gary gensler, chairman of the s.e.c. as we get ready for an opening bell two minutes for now, plenty of news we can talk about. >> i have to tell you if i am in the shoes of the people from coinbase or people who are in crypto, i think that you have cause for concern that perhaps things aren't as clear or disclosed and that maybe the risks are not disclosed and that was terrific that he brought that up. >> yeah. i mean bs, i do feel like a lot it was history lesson. >> but he was schooling coinbase. >> but the question still becomes when when are we going to actually see? it takes a while the rule making process. >> a lot of it takes us right back to the testify idefinition

securities which entails listening to a history lesson of sort. >> i didn't get any comfort the $60 tether and what's in it. i think there's a lot of belief in safety all over the place that there may not be. i also liebdked that he really d it clear that perhaps some of these trading apps encourage too much trading and not much investing. that is not something that is usually the purview of s.e.c., but this is a brand new world. >> overall, david, i would imagine you get the sense that he is aware in all buckets that the s.e.c. has to be active in right now. >> it does we went through just five. we didn't even get to esg and disclosure there so much of it does come back to disclosure, whether it's spacs, whether it's china, v.i.e. structure, whether it's esg and how you measure it carl. certainly i think we can be confident. >> as david said, what are you

going to do about it that's going to be the question for him in this interview and many to come let's get the opening bell here, cnbc realtime exchange big board, running shoe maker ahn celebrating its ipo at the nasdaq, and definitive health care >> he made the point that sunlight is the best disin disinfectant, disclosure is good didn't you get the sense in some of the things that are happening he doesn't think disclosure is enough rule making may directly impact that millions of people have joined trading and may be confused at commission trading that no commission trading is necessarily free. >> yeah, how do you view the comments there specific to payment for order flow and the future importance obviously it is for robinhood's business how should the shareholder there

view that? >> i think there's a false dichotomy that was pointed out i think that the commissioner does not believe that there is -- that you either pay a lot precommission or you get payment for order flow he has been saying that, you know what? it does have to be like that, even though senator toomey said that's what gensler's doing. i like the fact that i'm looking for these brokers that don't charge commission and don't review off of payment order flow, people will very much dislike the term ripping off i do think that chairman gensler thinks it's a false dichotomy. >> do you think brian armstrong will think twice about threading again on twitter >> i think brian armstrong is cfo, hold mr. gensler in c contempt, and that's a very ill-advised strategy the last i looked mr. armstrong runs a private company and the purview of that company is chairman gensler so when you take gensler on, that's kind of like taking on the person who says let me tell

you what you can do and not what you school me on i think that maybe mr. armstrong's going to be a little more circumspect going forward after that interview. >> we'll find out. plenty of other things for us to keep an eye on this morning. i got to start off with our parent company stock which just cratered yesterday comcast shares down 7.3%, this after michael kakavanaugh. we did do it yesterday obviously and told you about t made some comments that indicated a slowing of growth in broadband not much of a rebound. four years ago, same conference, different gentleman. same thing, basically warned about slowing cable subs, stock went down 7% in one day. history repeated, many of those investors were aware of those 217 c 2017 comments and immediately saw that they sold. >> we work for the company, i thought the disclosure was appropriate, but i do think that

the month of august is not necessarily you want to base a gigantic company's future on i think you'd agree with me that august was a very in flux month in this whole country. >> yes, and covid has created sort of disruptions in typical patterns of going back to school, of new household formation and things of that nature. >> and then of course theme parks, this morning hollywood reporter is confirming that j peck will be with the president today as the president meets with a number of ceos to bolster support for vaccine mandates >> i think it's important, mr. cha peck has been one of those people who say the people who work at disney world, we must ensure they do not hurt the guests if you do not get vaccinated, perhaps you should move on after 60 days. i think he's been the role model, at least when it comes to president biden. remember, he's doing that in florida where the governor seems to think that everybody's who's sick has the right to make us sick i'm against that. >> we're going to lean on energy for the open here. we got brent above 75, first

time since the beginning of august energy is definitely the most powerful sector to the upside today, and a lot of discussion about the pattern this week, better volume on down days banks facing lower yields. not great commentary on loan growth so far this week. >> there's real issues that make it so you do want to fade any upward movement, they're flirting upward and then by 9:45 they give it up. the part of the oil complex that most worries me is the widow maker. that's called natural gas. i had had shreev suki, we are in a bizarre situation in this country. natural gas is 5 you know natural gas is 16 in europe unsustainable. we can send all of it over there and still get the europeans a bargain. >> we send about 20% of our

production we export at this point. >> are you worried about a certain point that could be too much >> there also is a growing concern about power production in europe and something we need to keep an eye on in terms of a macro perspective in terms of their economies. they rely on wind to some extent wind is not blowing the way it was. i know that sounds strange, but it's true. you need backup supplies the power, they may not have service they want. as you point out, or redundancy is lacking here, you know, where you've got the natural gas, you don't have the pipeline capacity, jim, to potentially provide it that is from the northeast nobody's building a new pipeline. >> well, they've tried, and it's being blocked. there's a pipeline that is going right through a piece of property i own, and if you go there, you can see it ain't happening, and this administration has made it so pipelines that are in existence are worth a great deal more. i was speaking to chevron which

has a really great perspective as david said we can't get it to where it has to go but we will get it there eventually. >> propane prices also are through the roof so to speak. >> that's a regular cost for individuals. >> i know, if you heat your house with propane, get ready. >> get ready i got the bill. >> fill up the tank. >> i think it was b of a, if winter's super cold, could you be looking at $100 on crude. >> if it's super cold, i think it's a possibility, but a lot of it has to do with the fragility of the infrastructure. we decided a long time ago that all of our infrastructure for pla plastics, exports should be in louisiana and texas. you know what? those are areas that are not as stable we are still dealing with ida wiping out so much of our production >> yeah. >> it's incredible. >> not all of it back. >> meanwhile, it comes to the permian and oil, we're not

producing a lot more at this point. right? >> there's tremendous discipline. >> there is and return of capital in the form of dividends that are paying themselves so who do you want to own there then >> you want to own chevron because i think that chevron -- did you know the same day that engine one won, chevron defeated some of its own in a very important particular item about spending more money basically on conservation >> right, well, they increased significantly their expenditure. >> 3 billion to 10 billion >> would that mean that 7 billion that might have gone to create -- to giving us a reliable source of energy, i don't know i think that they -- the balance here with a lot of these companies, carl, can they do esg. can they do what's right for the economy and what's right for the environment and still pay the dividends? jpmorgan said oil's got to stay higher for chevron to be able to do it. >> i do know a number of people

looking, some of the smaller producers that aren't hedged that's an important component of it as well if you're hedged, you're not going to benefit nearly as much from it. you want to look for those companies that don't have significant hedges on. >> or hedges coming off. >> devin is the company that i think has the best growth and best capital discipline. that's rick monkrief who's regarded as the two people who have the best handle on how to make the most money for shareholders, which was not in the cards for many years. >> we are getting some support for microsoft, 11% div hike, the general trend on buybacks, jim, is that they are coming back fairly significantly. >> it's interesting that i had akesha aurora from palo alto. he's more focused on buybacks than acquisitions. i was hacked pretty badly, and i believe i was hacked because i brought in a tv, a smart tv. there was nothing else that changed in my life, and boom, they have a device called the

okio, which now is good for home office i'm going to get as soon as i can it detects whether you've been hacked at home it's been a very bad hack for me i can't find where i breached other than the smart tv. i used a password that was equivalent of jim cramer i'm not that stupid. >> i hear you. the two dogs spelled backwards plus a previous dog that i once had. >> we do the whole dog various -- yeah. it's not great. >> you need factor awe thet occasion you need all that stuff. you got to be careful. i did want to put a button on our coverage of the rails at least now last night i did tweet that canadian national was standing down, wouldn't try to improve its offer to buy kansas city southern paving the way for them to into into a new agreement to

be acquired by canadian pacific. they originally had a deal to be acquired by canadian pacific until canadian national came in with a higher bid that they accepted, but went awry where the s.e.b. said you can't use the voting trust they've entered into that agreement with kansas city southern enterprise value about 31 billion, and for now canadian national goes away with $700 million net they paid 700 million originally, they get 1.4 billion back, and that's where things stand, guys. did want to end that one. >> also wanted to end this win situation in the casinos if you value win right here i've got some numbers >> right now at 87 it values vegas and boston at 13 times at 11 times ebitda i'm using a 20% decline in revenues don't forget they have 58% stake

in wynn interactive. finally macao valuation selling at six times ebitda, roughly half of what we value vegas. so carl, i think that what you are factoring in 82, 83, is that there's got to be maybe a 35% decline by the chinese i don't think the chinese are going to do that, but that's a serious worst case. >> that's the worst two days for wynn shares since the pandemic began. march of 2020, people asking why. the chinese establishing a 45-day review in which they could potentially install government officials to supervise day-to-day operations trying to get casino operators to emphasize non-gaming type activities. >> non-gaming is what you give away in order to get the gamers. >> i can remember people being concerned about these licenses coming up for renewal in 2022, years ago when the trump administration was obviously having quite a few tensions with china. it's not as though this was unfamiliar territory to a lot of

investors here >> my trust felt that 100, it started to factor in this because i was using a 20 p% haircut. these stocks are reflecting the idea that president xi doesn't want anyone to lose a loftt of money at the casino. i don't think at a certain point he wants to wipe them out. this, you've got a slowing economy, carl, that is mandated by president xi, and i don't know, president xi does not seem like he liked the movie "casino," david, right alan king. >> alan king. >> and rickols, don't forget rickols. >> maybe put it on show time or something, maybe a remake. he doesn't understand that the casino gaming commission is just

as honest as the paul bureau >> we did speak with gary gensler for the first half of our hour here. quite a lot of things to cover, including of course we started with crypto. those pointed comments from the ceo of coinbase last week, and of course mr. gensler had a nu number of thoughts on the subject particularly in terms of whether or not any of these tokens and the lending aspect of the business as well sort of represents security. take a listen. >> i think the laws are cleear, the case law, the supreme court's weighed in on this multiple times, and at many of these tokens do come under the securities law and to the extent that a platform, a lending platform or a trading platform, whether it's centralized or so-called decentralized and i say so-called, has securities on it our investor protection regime is there to protect the public

i think the public benefits from that, and that's what we're trying to do >> any takeaway from that in terms of what it means for whether you want to own coinbase and/or other related issues? >> i think that what -- i own ethereum by the way, senator toomey has a position in some of this crypto, and i felt that it is vital that we find out what is in tether. what is in the stable coin i think the first thing he said to me is tim massett, a friend of mine from law school, is really worried about what is in tether, $60 billion. i think mr. gensler is too he did not tell us what's in it because i don't think he knows, and he should know. >> that's the problem. >> but they won't tell him. >> jim, we haven't yet reflected on apple, and the product unveil yesterday leading with apple tv, the ipad, the ipad mini, the iphone 3 some of these a15 bionic chips, but the stock did end down about

a percent yesterday. >> it rallied a little bit he's from sanford bernstein, he did what i think as a lot of people are saying it's a yawner basically. you won't like that word but that's what when i was listening to him, oh, he thinks it's a yawner i don't, i think it's a way to open accounts if you're at t-mobile or verizon, that's what matters. those of us who are thinking about getting a phone, we should be trying to switch to t-mobile or somebody. >> or at&t apparently is offering -- >> how much do they want to lose, at&t, continuing their philosophy losing -- it seems to be -- >> you just can't find your way to anything nice to say about at&t, can you? >> i think that they're nice people. >> you do? >> yeah, very nice people. >> i don't know. i got to get -- my daughter's got to get a new phone i'm not going to screw it up like i did with my son and just pay full price at the apple store. >> i'm saying -- >> looking at all of it.

>> verizon, though -- the nfl does that matter to you? i have -- this is like a 1g. this is the 10, it's like a 1g i was trying to vup date my fantasy portfolio, at 7:00 i found out that i had dropped -- i got kirk >> no cinematic mode on your phone. >> cinematic mode. i have mr. circle. what are you watching there, jim? the circle she's looking at instagram she's checking on everybody's dog. me, i got the circle. >> speaking of instagram, the journal has been doing some pretty serious reporting on facebook, i assume you guys have both seen it. >> we're going to talk to the reporter on tech check today about a remarkable look at some of the internal documents and what they know ostensibly about what at least instagram does to say the feelings of teenage girls, anxiety, depression. >> my daughter was a helpful -- yeah, she was a counselor for a suicide program for young women,

or troubled women. and the first thing they do is try to take the phone away because of facebook, instagram, and what happens the kids find a way to break in because they can't stay away. and we know that the bully never ends. >> any parent of a teenage girl knows there are potential deleterious effects from instagram usage and facebook seems to know it too >> yes >> the question is, jim, does facebook -- and this was brought up in the journal article a number of times. does it become like tobacco? >> oh, man, you sound like -- they raised that question. >> marc benioff. >> one of the first to say that tobacco analog. >> my problem with that is that the tobacco companies maybe you're saying the memos indicate they know too. remember the tobacco executive came to the hill i know nothing that was sergeant schultz. >> we know different and then

the huge, you know, the huge state funds that have been appropriated to deal with -- maybe deal with mental health, which is a huge issue in this country right now. >> i think that -- >> it always is, but even bigger as a result of the pandemic and some of the other things. >> i think facebook helps small businesses. >> okay. >> wow >> did we go 47 minutes with no commercials? >> that's what comcast is about. >> comcast is going to go down on that. things are tough enough. >> we doe have swings here in the equity markets dow is now up 92 facebook gearing up for an all civilian space flight. our morgan brennan is at the kennedy space center. >> this an historic site for an historic launch. that's 39a where apollo and space shuttle air astronauts began their journeys to space decades ago. if all goes according to plan, tonight four private citizens in the first ever fully commercial

all civilian mission to orbit will join that list. i sat down with the crew ahead of this major milestone. we've got that discussion, plus all the details as we count down to liftoff ats coming up at the topof the hour stay tuned to "squawk on the street." ah, same deal! yeah, it's kind of our thing. huh, that's a great deal... what if i'm new to at&t? cam, can you...? hey...but what about for existing customers? same deal. it's the same deal. is he ok? it's not complicated. with at&t, everyone gets our best deals on every smartphone.

today, things can be pretty unexpected. but your customers, they still expect things to be simple. and they want it all personalized. with ibm, you can do both. businesses like insurers can automate it processes across clouds. so agents can spend more time on customer needs. and whatever comes your way, you've got it covered. saving time and improving customer service, that's why so many businesses work, with ibm. your shipping manager left to “find themself.” leaving you lost.

you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire what the world needs now... is people. people who see healthcare a little bit differently. where technology helps doctors provide more precise care... leading to faster, better outcomes and puts improved health in all of our hands. because seeing a healthier world isn't far in the future. we're building it... now. ge building a world that works.

time for the bond row port see how treasuries are fairing following the release of the industrial production datau thi hour empire was pretty good yields getting closer to 130 in the u.k., inflation rising at its fastest pace innall ploes a decade consumer prices up year on year. dow's up 1:15.

i wonder how the firm's doing without its fearless leader. you sure you want to leave that all behind? yeah. stay restless with the rx. crafted by lexus.

experience amazing at your lexus dealer. if you're 55 and up, t- mobile has plans built just for you. crafted by lexus. whether you need a single line or lines for family members, you'll get great value on america's most reliable 5g network. like 2 lines of unlimited for just $27.50 a line. only at t-mobile.

baaam. internet that doesn't miss a beat. that's cute, but my internet streams to my ride. adorable, but does yours block malware? nope. -it crushes it. pshh, mine's so fast, no one can catch me. big whoop! mine gives me a 4k streaming box. -for free! that's because you all have the same internet. xfinity xfi. so powerful, it keeps one-upping itself. can your internet do that? time for jim and stop trading. >> jim farley tells me of ford that they are now doing a real test with walmart a terrific partner. they're going to test self-driving systems in the real world. so, it's finally occurring

i think it's a very big deal i know this argo project is no longer a business. so, self-driving cars, they're here, they're here >> they are? >> yeah, they're here. >> because we thought they would be here and we thought maybe last year they'd really be here and they're not. >> walmart is a real company i go there and haven't done specials on it i think it'sger to have this kind of -- >> more regulators on this story. >> we need disclosure there. >> on autonomous cars? >> if anyone's driving it. dprrs >> the trucking routes -- >> they're doing a bunch of cities 367 >> drop something off and load on another truck >> yeah, you got that right. yeah argo >> chevron tonight >> chevron yeah mike wirth

we're going to talk about the trade off between becoming esg, getting cleaner. that's okay. chuck says analyst day and weber, i mean, are you grilling? are people switching to grills that are plug in because they're worried about propain, not just the cost but if you run out, it gets worse >> nice upsitde guidance on revenue. when we come back, morgan brennan at the kennedy space center where spacex is looking to make history. >> in a matter of hours, four civilians will ascend the tower and climb inside spacex's dragon capsule, which could usher in a new era of space flight.

♪♪ in boxing or any other business, one day, you're gonna take a hit you didn't see coming. do you stay down? or do you get up? [announcer] and this fight is a long way from over, leonard is coming back. ♪♪ ♪♪ [uplifting music playing] ♪ i had a dream that someday ♪

♪ i would just fly, fly away ♪

i wonder how the firm's doing without its fearless leader. you sure you want to leave that all behind? yeah. stay restless with the rx. crafted by lexus. experience amazing at your lexus dealer. ♪ good wednesday morning welcome to another hour of "squawk on the street. our morgan brennan's at the kennedy space center in florida

where tonight spacex will launch the first all civilian crew into orbit. in the meantime, markets trying to rebound from a two-month low on the dow, 1-month low on the s&p. trying to avoid two days down, which we haven't done since 2019 >> here are three of the big movers we're keeping an eye on we'll start with microsoft company also announces a $60 billion stock buyback program. seems like a lot but it is $2.74 trillion market cap. regeneron shares are up. that will bring the total number of doses purchased by the government to 3 million. >> and we will end with what is a newly public company weber.

sales rising 19% from the year earlier. >> meantime, bitcoin rising to the highest level in over a week as he said on our air a few moments ago. quote, this is an area rife with fraud and abuse. our next guest runs the trading platform, launching an ad featuring tom brady and gisele >> this last one might be tough. >> no, he loves you. >> this guy. >> eve fj you wanted to come back, we wouldn't take you >> yes, you would. >> yes, we would >> i'm getting into crypto you in >> sam, welcome. great to have you. appreciate the time. >> of course thanks for having me >> could you explain what it's like whether you're obviously growing quickly, the marketing effort is extraordinarily strong

at a time when regulators, at least in the eyes of some, are getting more aggressive? >> absolutely. you know, we don't want to see regulation as a thing that staples our business for the industry we think it's incredibly important and that's important constructively but there are ways to do that while still greeing your business. we think that's the most important position to be in. >> what do you make of it when some of the colleagues across the sector call the behavior of the sec sketchy? is that a view that's widely shared in the industry >> there's a wide variety of use. there are a number of people who feel that way. i'm sure there are a number of people at the sec who feel that way about the industry and i think this is just a case where it got off on the wrong foot

and between the agency and chair ginsler. and i think this is -- this doesn't need to be a war between industry and regulators. because i think in the end most people want the same thing, which is to have access provided in a safe, regulated way to americans for a new, growing, really exciting sector and i think that, unfortunately, see situation wheres the sec feels like there have been extremely noncompliance companies that have been hard to work with and they feel they haven't got the guidance they want from the sec. when there's that type of divergent to begin with, sometimes that just grows. >> yeah, i love you to respond actually listened to chair

ginsler, who joined us in the first half hour of our 9:00 hour speaking skpifically on this point you're making. take a listen and love to have you respond. >> words of further engagement with the companies in this space and it's really about how we bring baseic investor protection to protect people against fraud manipulation and this has been ripe with fraud and abuse. >> rife with fraud and abuse part, sam, is what's stood out what do you think? >> i think rewind three years and i think i'd agree with the statement. three years ago, it was an incredibly exciting growing space and extremely messy. and frankly, there were fraud a fair number of them in the crypto industry. and there's a lot of market activity that would not have been allowed on a regulated platform i think things have been cleaned

up to some extenlt over the last few years. i'd like to think we played a role in that i'd like to think others played a role in that in terms of setting a different standard for the industry 367 i think there are reasonable steps to have some bounldries on -- i think one example is market manipulation. one thing i'd expect them to look at right now and i'd be shocked to see movement on is around coming up with a guidelines for crypto exchanges. right now, as they live in the money service business regime. which is an appropriate regime for part of the activity but i would expect to see antimarket manipulation, antiwash trading come out. and obviously, we've seen the sec take action against scams in the industry and we would welcome them. spell out internal fraud protection

we're welcome to share those and have dialogue. we've been reaching out to government agencies. on the flip side, i think it's important and especially in the context of those happenings and presuming those will happen and the industry will be cooperative, that, along with that, there is over time, further guidance on some issues which there are really legitimate points raised on both sides. i think, especially when you look at what tokens might be security, it's a really hot topic in krimto. has been for years i think they acted in a noncompliant way but i think there's clarity that could be given on the margins there. >> the one other interview we did on the early morning show was bridgewater, talking about bitcoin specifically "i think at the end of the day, if it's really successful,

they'll kill it, because they have ways of killing it. doesn't mean it doesn't have a place or values. it's one of those things, at the owned end of the day, that doesn't have intrinzic value." >> i think people said similar things about the internet. there were a lot of a frauds and companies thin and folded. what came out of that was an enormous industry that revolutionized the world i'm not saying it will happen with crypto but it's a possibility and i think america has a long history of not trying to kill innovation the goal here is regulate it, not regulate it away even chairman gensler has said he's trying to be antifraud, not

crypto i would be surprised if it happens, especially in the states where i think freedom and comptrition incredibly important corner stones of not just industry but regulation as well. congratulations. please come back >> any time. well, today marks a major moment in history of space flight the first commercial all civilian crew set to launch later today from the kennedy space center in florida. and that's where we find our own morgan brennan >> reporter: tonight, if there goes according to plan, ninety-four private citizens will head to that launch in teslas and on top of a falcon 9 rocket that's flown to space two times.

it will launch them to anality tutd that humans haven't gone to in more than a decade. it is the first ever, all civilian, fully commercial mission to earth orbit it is an ambitious space flight. it came together four months ago when jared isaacman teamed up with elon musk and spacex for a mission to raise $200 million for saint jude's children's research hospital. three more crew mates were chosen and the results, scientists and educator, and child hood bone cancer survivor and st. jude physician assistant, hayley, arceneaux, who will also be the youngest person in space

ahead of this historic spacex space flight, i sit dune wdown with the crew who are tell me that they're, quote, excited about human space flight and how it speaks to the beginning of the process of the normalization of space travel. >> it takes a lot of private funding to bring down cost everybody knows space is expensive. but so were computer ss in the '60s and scell phones in the 80s also we've been very responsible from the start, knowing that this is a first. and we are focusing an awful lot on the good we can do at erlgt as well as what we can accomplish in space. and we're giving back all our time in orbet for the causes that matter most to us >> it is raising awareness and $200 million for st. jude's research hospital.

i know half is being donated by you personally 30 million has been raised so far. how do the pay load said and missions help to raise those funds? >> we're bringing several items we're going to auction later and one we're excited about is a king of liones song. we're go tag play that in space and we're bringing watches, really cool specially-designed watches. we had some st. jude patients design art incorporate ud into jackets. we're bringing up hops that are going to be flown to space and later make space beer. >> you guys will be inside a dr dragon capsule, which is essentially the size of a large suv. you're going to have a busy schedule as well

in terms of health and medical and science experiments and research, what will that entail in orbit and how could that have real-world applications back on earth later? >> i think once up in orbit, we'll find tzero g environment will give us more room prrls but all the medical experiments, we're doing lots of swabs on different parts of the body to see how they're effected by zero g environment and we're going to be testing our glucose levels to see how your body metabolizes differently in zero g, if it does we don't want to just do research and scans of dna and blood sugar levels we want to know what it's like

and what it will take to send more people in space can you send diabetic people and do it safely and maybe apply answers back on earth. >> working with spacex, what has that process been like >> oh, my goodness i'm going to hog warts it is the magical place where the advancement of human space flight is happening. so, the first day i walked through the doors, i was in awe. and it's been a fantastic place. >> i'm going to ask you a similar question, jared. i know we talked about it in the past but not only the process of working with spacex and maybe inspiration you've been able to draw from the company as well as the ceo and founder of your own fast-growing high-tech company, what that process has looked like and what you've gleamed

from it? >> you look at any major technological break through and someone comes out with a smart phone and somebody else did. they started landing rockets on ship said six years ago. they've done it 90 times no one's done it once. >> how is elawn on musk been ine snd. >> inspiration is just a portion of that. but we've connected early on, as far as the original mission planning and there's a handful of check points along the way to see how it's going a lot of check points are things to come and the world's problems he's trying to solve >> given the fact that space flight, i don't want to say common place, but that there are more opportunities out there

whether it's richard branson's virgin galactic. is this the apex and one and done >> i'm ready to go to the moon so, who has the moon up and on to mars. >> i guess final question for you, jared as somebody who is a entrepreneur and innovator, how are you thinking about it now that you've had so much more exposure and in depth interaction with the sector? >> this is very exciting i mean, how can you not be drawn towards aerospace? but i think that really the best way that i contribute is really just being the small part of spacex's bigger plan because if anyone's going to achieve this goal so multiplanetary life, it's going to be them

>> reporter: so, that is just one part of a much longer interview from my time sitting down with the crew of inspiration. you can check out the full discussion on cnbc.com i would just note this came together so quickly. this crew was basically selected and formed six months ago. it has been an absolutely hur oceans training. thousands of pages of academic research and study that has gone into the process as well >> what is required of them? isaacman, i know he's a trained aviator, listed as the commander, i guess but what is actually going to required of the crew when it comes to operating the

spacecraft >> hopefully, nothing. or very little because it is designed to be fully autonomous as part of the training process over the last six months, they have trouble shooted and trained basically every aspect of this capsule. they've spoken to former astronauts from nasa commercial crew missions. and one that went into low-earth orbit with dragon. they trained to man this spacecraft if need be. they're in contact with mission control and there's been an incredible preparation i think sitting down and speaking to these four future astronauts, if all goes according to plan is how calm they are i think i'm a little nervous for them but it's a major milestone because, in many ways, this is a crew that, based on historical government methodologies would

not have been selected to go to space and speaks to this democratization as we see space flight become reality? >> and judge how it's seen as a templet for future civilian space flight, morgan it's going to get really interesting from here and w weather looks pretty good tonight. as we go to break, here's the road map for the next hour including casino stocks. plus we're going to speak with goldman's apple analyst and peps co rolling out a new push for sustainability. what the ceo said in an exclusive interview. dow currently up 61.

falling for the second straight day in a row. eunice >> they're changing the rules of the game the 20-year-old casino licenses by the likes of wynn and sands

they're going to kick start a process. and how totighten supervision. more specifically under review there are requirements that they obtain government approve before transferring and distributing profits to shareholders. and increase the voting shares of mucow permanent residents no, they want to promote non-gaming elements and social responsibility to diversify the sectors offerings away from gambling j.p. morgan down graded macao gaming

short term though, the city might not get the autumn bump out of tourists that it was hoping for the authorities here in beijing, issued an advisory to encourage people to not travel outside of china over the autumn, midautumn holiday or national holiday. a lot of that was an upsurge of coronavirus and they all come from overseas. >> fascinating story today and it's having a real impact on those shares appreciate it. it's time for our etf spotlight. ticker iyt, up double digits for the year and keep an eye on fedex they've been out performed ahead of the earnings report this week and says the peek shipping season could see record demand

and stock break even by the way t is 100 days until christmas. we'll take a quick break dow's up 50. ♪ ♪ ♪ ♪ ♪ ♪ ♪ ♪ that building you're trying to buy, - you should ten-x it. - ten-x it? ten-x is the world's largest online commercial real estate exchange. you see it. you want it. you ten-x it. it's that fast. if i could, i'd ten-x everything. like... uh... these salads. or these sandwiches...

ten-x does the same thing, but with buildings. sweet. oh no, he wasn't... oh, actually... that looks pretty good. see it. want it. ten-x it. yum! (vo) unconventional thinking means we see things differently, so you can focus on what matters most. that's how we've become the leader in 5g. #1 in customer satisfaction. and a partner who includes 5g in every plan, so you get it all. i think you're going to like it here. umm, why is everyone... 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. see that you do. would you like some coffee? workday. the finance, hr, and planning system for a changing world. ♪ what the world needs now... is people.

people who see flight a little bit differently. so it takes less fuel to bring people together... and make faraway places feel a little closer... with engines that power planes more efficiently. because seeing a better-connected world isn't far in the future. we're building it... now. ge building a world that works.

california kicked off the california streaming event, including the iphone 14, a new ipad and ipad line they'll begin shipping next week with the watch set to release later this fall. joining me is the apple analyst. good to have you so, give me that reaction. what did you think >> it's about what we expected incremental updates with the iphone the larger screen is nice. you know, they redesigned the phone last year and new information out of it is what the carrier subsidyress going to look like in the u.s

they look agreszgressive, better than last year and we know that helped draw sales. >> and that subsidy you referenced, including an adapitation of 5g but something that perhaps fuels more sales than some may anticipate >> we've never been -- and they seem inclined to increase 5g pen fragsz and utilize new spectrum they have. things don't change all that much from a sales forecast point of view, we're not changing anything we still think that it's going to be challenging for apple to make street forecast for the december quarter however, given delta reopening

supply chain shortages, all the complexity of the back end of this year, i'm reluctant to get too aggressive and we're looking for the data, following the data as it comes. >> for a hardware day, it was hard not to notice them leave with apple tv. there's been reports they're looking to boost content aggressively we think we know turn on apple tv is well above the industry average. how did it relate to yesterday >> it got high ambitions we know that they're spending a lot of money on content the costs there we think it's ramping up to pretty high levels if you could see those margins underlying the services margin, you'd see drag there

but again, they've got great shows and so on. they've made good progress from a show's point of view but they're still pretty high, relative to the revenue and the turn seems pretty high >> to end on a broader question here when it comes to 5g, the user experience, things don't change that much. when does that change? when does the user experience change, if it does and when are we going to see a proliferation of apps in the same way we did when we made the move from 4 g? >> you have to understand the 3g to 4g move, which i lived through. we had a latency reduction it took a long time for data connection to spin up. you had a lot of latency there you didn't have as much capacity either more apps became possible with

4g 5g you don't have that big of a change in the latency. and capacity goes up but you already have more than you need. the thing that will change 5g, i think, is if we see things like verizon's fixed wireless access rolling out. you're paying for mobile broad band and you can add a little to that and get your home broad band i was at giants stadium the other night and they have millimeter wave, ultrabroadband in that stadium. i have three gig bits. that's better than i get at home they're capable of a home broad band experience. that would be more what does broad band cost me than a device point of view. >> that would have broader ramifications for companies like

our parent company as well appreciate it. >> good talking to you >> let's get a news update hi, rahel. >> good morning and here's your cnbc update at this hour authorities say michael langman failed to properly investigate nasser, the gymnastics doctor. the gold medalist and other gymnasts prepare to testify before the senate judiciary committee. they're looking into the nassar investigation. and under a mandate, all health care and home care workers, home aids and urgent care technicians need to have at least their first covid shot by september 15th or face fines or potential sanctions. and both south korea and north korea test fired ballistic missiles today it's the latest in the interkorean missile race

south korea tested a ballistic missile launched from a submarine. it's the first country without nuclear weapons to devopuc syemel sh [slow electronic notes fade in] [fast upbeat music begins] [music stops] and release. [deep exhale] [fast upbeat music resumes] [music stops] i wonder how the firm's doing without its fearless leader. you sure you want to leave that all behind? yeah. stay restless with the rx. crafted by lexus. experience amazing at your lexus dealer. (vo) unconventional thinking means we see things differently, so you can focus on what matters most. that's how we've become the leader in 5g.

#1 in customer satisfaction. and a partner who includes 5g in every plan, so you get it all. another day, another chance. make the most of it with the network that can deliver gig speeds to the most businesses. and get the advanced cybersecurity solutions you need with comcast business securityedge. ask how to get comcast business securityedge to help protect all your connected devices. and get started with a great offer on fast and reliable internet and voice for just $64.99 a month.

plus, ask how to get a prepaid card up to $500. call or go online today to learn more. comcast business. powering possibilities. welcome back to "squawk on the street." the private citizen flight is set for tonight. including billionaire and ceo and inspiration for ben factor and mission commander. the mission is to raise awareness and $200 million for st. jude's children's research hospital and it will mark a major milestone for commercial space flight and spacex and tourism market more broadly. managing partner at space capital. chad, great to see you your firm is an early investor in spacex. this is a company nat, while privately held, is involved in

quite a number of initiatives and businesses so, in terms of this first all civilian mission to orbit, how significant is it for spacex >> it's significant for the company and the industry at large. this is the first time in history we're going to have four civilians on a mission by themselves nasa is not involved they're spectators like the restf us these are not professional astronauts this is a charter flight and four people who have really just met themselves a few months ago. it's interesting to see how this all civilian missions plays out. the first time it's ever happened and in terms of growth, when this mission launches, there's going to be three dragons in space and two different crews they've taken to orbit so, this is a big milestone that show cases the capability of spacex

>> yeah, it's pretty incredible when you put it in those terms and certainly spacex said it has a growing launch manifest for some of the private crude trips. space being one of the next companies with missions set for next year. that being said i guess how does it fit into -- and i realize the cost for the actual mission itself has not been disclosed. but how does this help the broader, longer term ambitions? in 2015, they landed a rocket booster and ushered in an era of reusability, which is the holy grail of bringing the cost of

space flight down and was the catalyst for a lot of venture capital activity in 2020, they became the first company to take humans to space and now they have this all civilian mission all these successes have driven progress and confidence in the company, which is allowing them to raise the capitol they need for their ambitious assprations. but also for the economy at large. we've now seen $200 billion invested in to 1500 space companies over the last ten years. up from basically zero before that >> the numbers are growing and certainly a number of companies that have gone public in recent weeks and months i want to bring analyst into this investigation as well sam, you are the person or i guess i should say the

arc-ex-space exploration and innovation etf that they launched earlier this year is really your brain child. i realize spacex is privately held but certainly lawn musk and the sister company, tesla, have been a big topic for arc overall. how are you looking at this mission and using it to analyze and assess the space sector. >> i think spacex does a tremendous job of taking the extraordinary, which is i think what we're about to see later today and making it organized. we saw that with re-useable rockets. five years ago, anyone in the industry said this is uneconomic and they lower the cost to orbit from the 10 to $14,000 to below 2,000. and that's going to continue to

decline with starship program and this is opening up the space economy. what we're looking to is not just look at outer space but you mention tesla. they're enabling other technologies in the space. we have air taxi companies coming public. you have blade as a platform and they're all taking advantage of these cost declined that are occurring and making the primetime for space now. >> yeah, it's interesting to think about it in those terms. that thatbying being said, etf doesn't hold much in terms of new space names. how are you assessing some of the companies that are now potentially looking to go more neck in neck with a company like spacex >> yeah, so everything we do at arc invest is based on long-term research and understanding

fundamentals and i think it's important to distinguish that space is an exciting era to invest in and what typically happens during those times in the early 1900s, when the car was becoming the new mode of transportation we saw hundreds to thousands of companies emerge and that gets widdled down what we're seeing with space and was just mentioned we have a huge amount of capitol going into this space and there are a lot of companies emerging. just because you're in an exciting theme, doesn't mean you're a long-term winner. what we try and do is use our research and that's the whole team because there's so much convergence, batteries and really brain storming together to make sure we're picking the long-term winners in this environment so, that's what we're going to continue to do >> great and as the saying goes, space is hard

thanks for joining us to talk about investing in the sector as it continues to grow and evolleyball. chad and sam >> as we head to break, take a look at crude oil. a much bigger than expected drop in inventories this after hurricane idait h the gulf, and put cupashty on hold stay with us e system than we do. i feel like they might have a better finance system than we do. workday. how do they make better decisions faster? workday. it's got to be something workday. i think i got something. work... hey, rob, you're on mute. hello! hey, rob, there he is. workday. the finance, hr and planning system for a changing world. what happens when we welcome change? we can make emergency medicine possible at 40,000 feet. instead of burning our past for power,

we can harness the energy of the tiny electron. we can create new ways to connect. rethinking how we communicate to be more inclusive than ever. with app, cloud and anywhere workspace solutions, vmware helps companies navigate change. faster. vmware. welcome change.

ok, let's talk about those changes to your financial plan. bill, mary? hey... it's our former broker carl. carl, say hi to nina, our schwab financial consultant. hm... i know how difficult these calls can be. not with schwab. nina made it easier to set up our financial plan. we can check in on it anytime. it changes when our goals change. planning can't be that easy. actually, it can be, carl. look forward to planning with schwab.

schwab! ♪♪ wondering what actually goes into your multivitamin? at new chapter, schwab! its' innovation, organic ingredients, and fermentation. fermentation? yes. formulated to help you body really truly absorb the natural goodness. new chapter. wellness, well done.

that was sec chair, gary gensler. he was there earlier in the show we were there talking about spacs. and shareholders choose to get their 10 bucks, leaving companies with far less cash than they anticipated. sometimes vilolating the minimu cash requirement although, many get a waver and they say we'll be fine with millions less than we anticipated. he did know the numbers off the top of his head. >> intering to see him separating the framework from issuance volume.

one is not very many and to hear him say he'll keep his eye on the ball, even with a number that low is amazing. >> it is a lot less and obviously you can see our post spac indexes these are not trading well and haven't been for some time and that tends to have a effect on the willingness of others to actually try and do. >> not to say it couldn't come back and one piece of the half hour long conversation we had with gensler this morning that was good television sending shares of grubhub parent just eat takeaway lower. down 20% for the year. we're up 41 for the moment stay with us

(vo) this is a place for ambition. a forge of progress. a unicorn in training. a corner to build a legacy. a vision for tomorrow. a fresh start. a blank canvas. a second act. a renewed company culture. a temple for ideas. and a place to make your mark. loopnet. the most popular place to find a space. new projects means new project managers. you need to hire. i need indeed. indeed you do. when you sponsor a job, you immediately get your shortlist of quality candidates, whose resumes on indeed match your job criteria.

visit indeed.com/hire and get started today.

as we go to break, watching facebook today lowest level in about two weeks. 2% on pace to snap a six-month win streak by the way, the longest on record the move, of course, comes as the social media giant faces more scrutiny for downplaying instagram's negative health

affect on users. especially teen girls icwhh we'll talk about more in the next hour. dow's up 46. stay with us.

♪♪ ♪♪ ♪♪

you have the best pizza in town and the worst wait times. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire pepsi announcing what it is calling a strategic transformation this morning.

ize's spoke with the ceo and joins us to explain what exactly that means, sara eisen >> reporter: good morning, david. called pep positive. the company says it's not just another esg announcement it's what they call an end-to-end strategic transformation, basically changing how pepsi markets products to consumer, how it innovates, builds up the supply chain. it takes sustainability from a policy and puts it into all the company decisions. the ceo says consumers want it now and wants investors to understand pepsi sees it as a competitive advantage hoping to outperform others who want to know where the potatoes in their lay's potato chips were grown, for example. net zero by 2040 net water positive by 2030 la guarda told me executives will be held accountable for

this. >> make sure where consumers, investors know exactly where we are in the journey we want to be completely transparent. we want people to be part of our journey, part of how we run the company. rear not waiting until 2040. we're going to make strong steps along the way, and a lot of these goals are actually of 2030 much closer in time. >> reporter: part of my question, all of these consumer companies announcing ambitious targets for 2030 and '40 is that soon enough? pepsi, the positive, runs counter to the health questions surrounding big hits doritos, chee-tos, gate oh-aid, artificial ingredients, high sulphur not necessarily good for you. a chal lenge we talked about. they're hoping to improve, he says, science-based targets to lower bad ingredients and working with chickpeas expanding

in nuts and seeds. about some of the changes coming much more from our collusive interview including the hot topic of inflation supply chain disruptions, consumer habits postcovid, david and how he's thinking about bringing people back to work runs an organization that employs more than 300,000 people. >> a key question for so many leaders. does it put pressure on competitors? main kun i'm thinking of, to do things similarly or is coke already sort of there? >> reporter: nobody is there to this extent, as far as putting sustainability at the heart of the -- the way they speak to consumers. i think it does put pressure he told me he sees those brands that are speaking out on these issues in direct marketing and advertising outperform some of the other brands pepsi already actually been outperforming in covid and coming out of covid. main competitors like coca-cola

andmondalay and chee-tos, do you want to know where it's sourced questions they're asking and give them competitive advantage, they thinks. all companies moving in this direction, no doubt. still, esg is a policy not necessarily a central platform as pepsi is announcing today definitely puts them ahead of the game. >> future is in chickpeas. look forward to that interview later, sara. thank you. sara eisen. back to morgan at the kennedy space center ahead of tonight's big launch morgan >> reporter: right if all goes according to plan, david, the all-civilian "since operation 4" mission lifts off from here tonight. "inspiration 4" opens up 8:02 p.m. eastern right now it's 80% favorability

in terms of weather, and for now systems go for tonight we'll be here all day covering that of course, for spacex, one of the most highly valued privately held companies in the world a major milestone but still just one piece of a much bigger, broader, ambitious strategy. one that also includes the star link broadband mega constellation. a well a launch for that actually just last night in the midst ofall of this. return to the moon, working with nasa on that and longer-term colonization of mars but spacex isn't the only company to watch in all this shift forward is as well so inspiration for benefactor and commander jared isaacman, company went public last summer. currently trades at about $77 under a little pressure today. perhaps in part because its chief executive is getting ready to go to space isaacman told me no sleep

juggling both essentially jobs, and never part of the plan, shift forward has seen more awareness and sufcustomers thro this process watching it all. >> great watching you, morgan morgan brennan, of course, another important launch. that does it for us here on "squawk on the street. "techcheck" starts now. ♪ good wednesday morning welcome to "techcheck. i'm carl quintanilla with jon fortt and julia boorstin today california day dreaming. wa exactly did we learn from apple's highly anticipated product event? and microsoft announces that massive dividend hike. how that compares to its other big tech cares and how to play it later on, a major milestone for elon musk in