i it's monday, october 18th, 2021, and "squawk box" begins right now. good morning, everybody. welcome to "squawk box" here on cnbc i'm becky quick along with joe kernen and andrew ross sorkin. we're all in pink today, blushing a little bit because we are here to make sure we are celebrating breast cancer awareness month want to make sure people think about that, that's why we're all in pink today. in red you see the u.s. equity futures this morning with dows indicated down about 100 points below s&p 500 down about 16. if you look at the treasury market last week we saw yields dip a little bit from the week before, this morning picking up, 1.612% is where the ten year is sitting. and then it's energy prices that everybody is watching right now.

last week you saw oil up for the eighth week in a row, up by 3.7% for wti. it's not stopping there. up another 1.25% this morning. $83.29 is where you're siting at wti. brent up by about 3% last week, it continuesto climb too and natural gas which had been the story we were watching natural gas was down last week by more than 2.5% and down another 3.25% this morning let's talk about the squawk planner this week. a couple big things happening. two -- you should say, week two of earning season, eight dow components 72 s&p 500 companies set to report. tomorrow we hear from netflix. also hear from united airlines, proctor and gamble, travelers and johnson & johnson. wednesday ibm and volodymyr zelensky

and thursday intel and at&t. and friday honeywell express we work expected to complete its merger and make its public debut later this week as well. a lot on the docket, joe. >> disappointing data out of china overnight. third quarter gdp growth just 4.9% the expectations weren't much higher, 5.2% still, though, it's -- it was a miss that analysts had been looking for. industrial activity weighed on the growth numbers, many factories had to stop production in late september as the surge in the price of coal and electricity prices prompted authorities to cut off power later this hour we'll take you live to beijing for reaction to the numbers. it was up a little bit from the second quarter but versus last

year's growth rate 7.9%, those are numbers you don't usually see in relation to china >> yeah. >> and then, it's weird the way this happened, happened very quickly. the first bitcoin futures etf in the u.s. happened slowly? there's an expression like that. took forever but then it happened immediately the u.s. is set to begin trading this week, etf futures you can see what it's done to the price of bitcoin it was higher a couple of times over 62,000 not back to the all-time high but close according to an amended filing from pro shares which came on friday we know about this. the s.e.c. has not formally approved the investment product and may never make a formal declaration of approval for it but the announcement from pro shares indicates that the agency is unlikely to block the listing. it's unclear at this point exactly when the etf ticker

symbol, bito will start trading. >> are you in the cramer camp or -- >> what's his camp now >> he's in the short-term pessimistic camp. >> has been a while. >> this has been a big ride, now there's been a bigger ride in the past week in anticipation of this and there will be a falloff after it and then there's the other view, which is the anthony popliano view which is this is the great signifier of the next big move. >> i've been watching the world series and there is a crypto partner for major league baseball. >> doesn't surprise me. >> gray scale now is the sponsor of -- took over the sponsorship of that stadium. >> yeah. behind -- it says ftx. >> we were talking last week -- >> crypto are you in >> we were asking last week because pepsi is coming up with

the super bowl sponsorship, reaching the end of the sponsorship and andrew you asked is it someone with crypto -- >> have you not seen the great tom brady ads. >> is that ftx >> it is they have a new one about the trade, everyone thinks he's going to be traded, there's a thing that gisele wants to move to l.a. and it's about the trading of not him. >> can it still go to zero jamie dimon? >> we don't think that jamie dimon said it's going to zero -- >> no inherent value. >> he said worthless. >> but you could say that about so many other things >> you can say that about everything, really. >> well, there's some things that you can actually use for something else, whether that be grains, commodities, some of those things, too. >> if you don't eat and don't

drive and don't need heat, i guess. but certainly, i think like many things are not inherently worth something. certainly the art world. >> that's right. diamonds. >> i might argue about a non-gold backed currency i mean, it's the full faith. i get all that but there's countries that have currencies that i think have no inherent value gold is used for jewelry but the case can be made that gold initially did not become worth a lot because it was used for jewelry. it became worth a lot because it represented the old ledger idea -- >> a limited amount of it, right. >> it was what you used for a ledger entry because there was a limited amount and because it doesn't, over time it stays the same and everything else people now make that case for bitcoin. i don't know back to my original question -- >> but i would also --

>> this is big -- >> where jamie may be right. this is the interesting point that gary gensler made on this, by punting on the futures one thing. leaves open the opportunity to fully regulate the actual thing, which is bitcoin so this is not just to say that -- >> regulation is okay. it's just we're not going to pull a china. >> depends on what you think the regulation is and what it looks like. >> it's kind of the wild west. you saw the reports about people hit up their coin base account and it says zero and before that it said 1.1 million. that can't happen often. >> and you're locked out you no longer have access to this account >> if the government were to say to coin base or any exchange or any -- anything where you would transfer or hold this stuff, that you have to have insurance against it, the cost of that would go probably pretty, pretty

high especially because the technology doesn't really exist for you to protect it in that way. >> i chickened out when bitcoin was, you know, 6, 7, $8,000, i thought that was cool you know how much etherium i bought, i bought two so it's -- i wish i bought like 200 or something if i could afford that but now i'm chicken. would you buy bitcoin at -- i'm chicken now. >> because you know you're speculating. you don't know what's going to happen. >> if i bought it at 8,000 i bought it as low as 4,000, other people bought it at 400, so at 61,000 i can't do it. >> the best chance is it gets to 100,000 more than doubles there you go >> but it was 40,000 three weeks ago. >> but kathy woods said it can

get to 500,000. >> you're making my point it was speculation. it's 40,000 two weeks ago and now it's 60,000. >> so is buying ibm, buying stocks, commodities, options >> there's some underlying business there >> options derivatives. >> no, you hope there's an underlying business with ibm. >> i like bitcoin better than ibm. >> you hope there's an underlying business behind most of the stock market. >> they stack and they stack, they don't care where it is. whenever there's money they buy more and obviously since we're back to 61,000 they look pretty smart at this point. and as they would say, have fun being poor, enjoy being poor. >> been on twitter lately. let's tell you about what's planned at walmart they announced their plans for black friday sales

they're stretching out the deals throu through the month of november. members of the subscription service will get first crack, they can shop online sales earlier than others. the service costs $99 a year in the next hour we'll talk about holiday supply chain problems with the president of american plastic toys. a company that produces all of their toys right here in america. up next, apple is set to hold a product launch event later today, what to expect. the stock underperforming the s&p year to date s&p up 19%, apple is up by 8.6%. we'll be right back. ok, let's talk about those changes to your financial plan. bill, mary? hey... it's our former broker carl.

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later today apple is going to be hosting another virtual product launch a lot of people are expecting the event to include new macbook pros and air pod threes. joining us now is dan, what do you think, is this something expecting a big deal and does it matter to the stock? >> i am expecting new silicon on

the mac and i think it will attest to the company's ability to continue invoe enovating aro the software and the hardware and service and the growth drivers at the company, the ipad, the iphone remains critical, the watch. so a lot of product here, the key to creating value for their users really is this integration. if they can continue to do that over time, we think they'll create additional shareholder value. >> integration meaning building more and more into the ecosystem, making more and more a sticky situation >> part of it is this user experience it's not just the hardware on the mack it's the software, the silicon, the services if you look at apple watch it's the fitness plus service that integrates it. it's a fun, easy and secure

experience you then layer on top of that, this broader ecosystem, this platform that really is the magic, if you will of apple. and that is really what is a powerful set of growth drivers overall. >> dan, why has the stock under performed the s&p 500 this year? >> becky, people are worried about slowing growth given just how strong the past 18 months have been for apple. i think secondarily people are worried about the near term supply chain dynamics. that's really a headwind that apple and all other companies are facing what's going to matter if we look into next year and more into 2023 we will see these continues -- or the continued execution on the product growth drivers. if they can do that, i think will be a nice stock over the next 12 to 24 months. >> let's deal with the supply chain first. do you think it's going to be a problem for the company? there have been reports that surfaced that they won't be able

to make as many products needed or demanded. is that going to be the case and if so will that demand be stuff that goes away or sales that get pushed into early next year? >> becky, i think they're already seeing issues from the supply chain, it's been impacting them all year, i think it's impacting them in the current quarter in terms of the recent iphone launch, i think it's a factor of the mac that they're going to announce today. part of them are going to get lost i think what will matter is if apple can retain those customers, can show continued innovation, that will ensure and we're seeing that in the numbers that the overall install base continues to grow. if that's the case, then the users will be loyal and you get new people who join the broader apple ecosystem. >> one thing i haven't heard brought up recently is just the questions about demand from consumers in china do chinese consumers still want apple products

is there any concern about the tensions built up between the united states and china and that kind of playing out on sales of apple products >> what we've seen, becky, is that the demand in china overall has been strong. i think apple, as many know, is an important contributor to the broader chinese economy, you have millions of developers around the world, including in china. the devices themselves, the iphone, the mac, there's been good growth in china and i think that continues even in the face of some of the trade and political tension. i think what will matter most to china is that in china is that apple continues to build great products that's what the chinese consumers rightfully demand. that's what consumers all around the world want to see. that in my view is going to matter more than the trade or political friction that has been ongoing, of course >> dan, have you remade your models at all when it comes to the services side of the

business in the wake of the epic apple decision and the appeal that's now taking place in terms of this 30% fee and what may happen if they have to have a button or a link to allow people to pay on other services >> andrew, i've been continuing to add to the model within the services segment because it keeps on growing specifically with regard to epic and the lawsuit there. i think what's going to happen is that apple will give more payment options and that some of the bigger companies out there, perhaps like an epic will take advantage of it. i think what we've seen with the app store is that what's important is most of the apps are free and the user has a great experience and so, over time you saw for example apple lower subscription pricing to 15% so you could see additional changes. i don't think it meaningfully changes the trajectory of the overall kcompany.

while you could see lower growth in the app store, the bigger story is they continue to attract developers and since 2008 the company has paid out over $230 billion to developers. so that ability to create value for others is i think what's essential to the apple story, even in the face of the dynamics with epic. >> good to see you, thanks for joining us. >> thank you, becky. china posting disappointing growth numbers for the third quarter. we'll get a reaction live from beijing next as we head to break, the biggest pre-market winners and losers for the s&p 500

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. welcome back to "squawk box" this morning china's gdp coming in weaker than expected overnight. want to get to eunice joon live in beijing what do you make of the numbers and what are people saying on the ground >> reporter: in terms of the gdp figures. the gdp for q3 missed expectations as you said also this is the slowest pace that the economy has been growing in a year. the stas you cans bureau said they continue to see a lot of unevenness and instability in the economy for the year on year figure missed but the quarter on quarter number was also something that a lot of people were talking about here because it grew at near zero, a lot of it is because of multiple factors we've been reporting on on for some time, power issues,

the regulatory crackdowns not only in technology but also in the real estate sector all of that contributing to the slow down ing describes these as pain points that they expect to continue to see into the year 2022 also, much of the pain for the factories was in september so the industrial output number missed as well at 3.1% this was the weakest output that we've seen since the start of the pandemic in march of 2020. there were two bright spots that helped to offset some of the deeper concerns that people are seeing in the property sector. exports stayed strong and then consumption also picked up in terms of the property sector, the new construction starts dropped in september for a sixth straight month, the longest series of declines since 2015. evergrande also faces potential default this weekend so a lot of discussion and concerns about that as you all know the central bank repeated over

the weekend that it believed that a lot of these risks in the property sector, especially around evergrande were contained but property stocks did sell off. so obviously showing a lot of investors are very concerned in terms of the policy that people are expecting out of the authorities here, most are now expecting that we're going to see more targeted easing and that growth is going to shift back into focus for the policy makers in beijing. >> eunice joon we'll see do we believe, i would ask you this, joe kernen, and becky quick, do you think this is one of these like cold they get a cold, we get a cold situation? is it like that? >> if i were -- you know, isaw a lot of conjecture over the weekend about, you know, what are we doing for the supply chain issues when we used to have austin goldsby on and we talked about

why we were not growing faster in the united states, he'd point to globally. seeing that china is slowing as well if i was joe biden i'd say this is a global issue i don't know if it's a cold and then we catch it -- >> if you're powell what do you do >> it's not just global. there's so much demand and that's the problem there's demand for so much and we can't supply it quickly enough. >> it's a global bottleneck. but energy is -- but that's a global phenomenon for the transition to renewables that's what happened in europe and everything else. we're seeing similar input of what's happening is a global phenomenon >> putin was speaking last week and he was saying part of this is because we didn't have supplies built up. you didn't have the natural gas stock pile. >> he loves it. >> he loves it like opec loves it i don't think we can pump more than 400,000 barrels a day

saudi arabia could we'll talk about to john more about that. >> but the chip -- >> chip problem is real but energy problem -- >> the labor shortage is real. part of the problem you have here is the labor shortage >> jones got there -- >> we'll talk to an american toy company and that's the issue they're not um porting, they're making all of their product here but when it comes to the supply chain, it's the labor shortage crunching them. >> coming up we'll look into the rise of retail traders during the pandemic robert frank joins us next with numbers behind that trend. and later we'll talk crypto with michael sonnenshein. "squawk box" coming right back hey lily, i need a new wireless plan for my business, but all my employees need something different. oh, we can help with that.

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good morning, everybody. welcome back on this monday morning we are looking at some red arrows this morning when it m comes to the futures market dow futures indicated down about

92 points this comes after a great week for the markets last week last week was the dow's best week since back in june and the s&p since july this morning the s&p indicated down about 16 points >> let's talk about retail traders during the pandemic. robert frank has been tracking stock market wealth and he joins us now robert >> reporter: good morning, joe millions of new investors opened trading accounts during the pandemic robinhood alone added over 10 million accounts now at 22 million. but stock market wealth has become more concentrated according to the latest fed data the top 1% now owns 54% of all stocks the top 10%, owns 90%. both are at all-time records there are three main reasons for these higher concentrations. first of all, the new retail investors are large in number

but small in account size. the average robinhood account now at about $4,000, smaller although younger than those at say vanguard or schwab they are more likely to trade rather than buy or hold, especially volatile stocks so returns have been a little bit lower, the top 1% had stock gains of over 43% over the past year that compares with about 33% return for the bottom 90% of investors. these guys are doing well, we're happy they're in the market we l -- we'd like to see the wealth more broadly distributed. >> right but another example of rising asset values. i guess we already know that they benefit people who have assets so is that good or bad it's good. >> reporter: the stock market -- yeah, the stock market is the

greatest wealth creation machine in the world it's great it's now more broadly owned. we want the spoils of that market to be widely distributed. that's why we want these investors to be in the market. we want them to stay in, and we want them to invest rather than trade over the long term. >> housing you want people to own houses but then you see what happens when you try to make it too easy to own houses we've dealt with that. but it's the upper -- you know, who owns houses, i don't know what percentage, when housing goes up, that seems to benefit the wealthy. anything that goes up is what you want, because it's also a reflection of the underlying economy, usually there's a reason why things like the stock marketgo up. so we're in a weird place, robert we don't want to -- >> you're right about -- >> we don't want to meet at a lower level. we want to raise people up. >> reporter: it's interesting to mention, you mention income

inequality it's actually right now declining rapidly. the bottom of americans are growing incomes at 70% faster than those at the top. so we have a dichotomy of shrinking income inequality and rising wealth inequality likely due to the stock market and other assets. >> that's where you think about wealth tax -- in the 3.5 trillion they didn't address that they're getting people that are well, the wealthy, but not the super wealthy. so once again we're stuck -- there's a certain number of -- it's a small number, but they're not going to be touched in a wealth tax is probably not the way to do it you have to do something with a step up. what's your answer you must know? >> reporter: no, i think if you want to address wealth inequality, and the people who are rising -- making money off assets, borrowing against

stocks, not paying income taxes. i think step up in bases as you and andrew and i and becky have been talking about is the most obvious and least damaging solution to that. the house took it out. we'll see if the senate comes back and pushes for that right now it's not in the discussions. >> thanks, robert. robert frank coming up when we return, crude prices higher again this morning. well above $83 for wti energy watcher john kildof is going to join us next and then tom fanning is going to tell us why we could see sticker shock on gas and electric bills this winter you can watch, do it anyimon te the cnbc app we're back after this.

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[ eerie music playing ] michael myers survived that fire. after what he's done to my family... i will kill him. tonight we hunt him down. [ screaming ] evil dies tonight. you want your mask? come and get it! welcome back to squawk crude prices on the rise against. wti on track for the longest win streak since an 11 week streak in 2015. i want to bring in john kildof good morning to you. it looks like a straight line at this point you can look at the front page of "the washington journal" this morning look everywhere and there are serious questions about what the price of gasoline is going to cost over the next couple of months if not longer, what the bottle nnecks and are n

a larger question about the transition to renewables and what it's going to mean to the cost of energy, at least in the short term >> yeah, i mean, there's definitely anxiety abounding right now about sufficiency of supply the future, as you just mentioned, the investment pace that's going on or not going on. i've been talking about a chill that has descended on the exploration and production companies that are u.s. based or publicly listed around the world that can get pressure from environmental interest that want to see things changed. it's going to be, obviously, a bumpy road and i hope we're not going to inherit the earth but lose our soul at the same time. >> let's break the issues in two ways, one is the investment case, call it short term and long term, and then there's the policy case about what needs to

happen one way or the other. let's first start with the investment piece of it, though short term, your sense, let's call it a month out or get to christmas, where is wti going to sit? >> it would definitely go higher, andrew let's get that off the board there's talk about people buying 100 call options on wti. that's a reasonable bet when you're at 83, particularly as we're headed into the peak demand season and the supply is not in particular. the saudis are holding back and sticking it to everyone. you're hearing about people buying $200 calls come due at the end of 2022. that's an event risk type of scenario, that's a lottery ticket i wouldn't put much faith or have any kind of concern nathose are being looked at. those are sophisticated sort of hedging devices that are just there for folks covering all

their bases. not at all a probability we'll ever get there but again right now there is a structural supply deficit. opec, saudis are not meeting it, our shale guys are doing the best they can but they're behind the eight ball -- >> is there anything in terms of that short term case you're making that could upset that argument >> not right now for instance, you had eunice joon on a couple moments ago talking about the disappointing chinese gdp number in more mall times that would have knocked the price of crude oil down a dollar, buck and a half at least. right now, no. we're in a bull market where good news gets embraced and bad news gets ignored. >> let's talk about the policy issue. it's something i think has been an undercurrent to a lot of the coverage recently which is as we move towards renewables we're creating a bit of a supply problem and the transition could

get painful, pivot to renewable strains energy market that's on the front page of the journal this morning if we made you king for the day, what would you do? is this the case you need to spend more money and ramp up renewables a lot quicker can you physically or is this a case of trying to bring some of the more traditional fossil fuel efforts either back online or to slow down the transition down on the other end? >> i think, unfortunately in the short term, for these goals we need to allow the traditional energy sources to continue to flourish in the short term there's no way around it we're going to wreck our economy. we'll wreck the global company some say we'll wreck the economy if we keep going the way we're going. i'm not suggesting that. but we have to pay for the future in a big way and invest a

lot more and maybe a carbon tax is an idea there's a lot of carbon sequestration efforts under way. there's a lot we can do with diesel fuels in terms of making it out of renewables that you can't do with gasoline. >> all the things you're talkin about are things that are going to take a long time. but if we're going to have a problem that has a massive impact to the economy, what can be done in the medium term what can we do that's right in front of us right now? >> take the pressure off the companies like exxon mobile and chevron. let them do what they do best, which is produce the needed fuels that are necessary for a smooth functioning global economy. right now they're chilled. the ceo of chevron, i don't know if he was joking or not but he said he was returning capital to shareholders to let them plant trees. i don't know if that's what we need we're putting a boot on their

throats. this company is built on a couple of tenants, cheap food and fuel right now what we're doing to the big oil companies is harming them, harming the supply and driving the surprprice up. >> gas is in the $3.50 range nationwide look at that compared to a year ago, obviously high. but adjusted for inflation over 10 years and if you had called me ten years ago i would have told you this was a great outcome. >> i'll tell you, if you look back at the economic shocks we've had over the years, spike in oil prices has been a part of it go back to the great recession when we hit $147 a barrel for crude oil. there's always other elements to it but oil never misses a chance to be part of the problem. that's what we're faye facing right now. a big part of our economy, 80% of our economy is consumer spending if the bulk of that

goes to your gas tank rather than the store, vacation, we have a problem also it's a sentiment killer to the extent the consumer gets down about paying $100 plus to fill up the suv, it's a big problem. >> it's probably the rate of change that matters to consumers. if you pay a lot more over a short period of time but opec looks at this and they have to love what they are seeing right now. any shot that they'll give us relief >> no. they're loving it. i think they believe they're getting their just desserts here the saudis could easily put another million barrels of crude oil on the market tomorrow figuratively speaking and that would kill the rally and they're just not doing it. they want the higher prices. they believe this global economy can live with 85, even $100 a barrel crude oil they wanted to put the shale operators out of business right before the pandemic hit, they

went for the jugular by flooding the market back then with crude oil, i point out, and now they won't do it. theones that want to do it, like iraq, nigeria are struggling they're facing some of the supply issues or infrastructure issues that are beleaguering the global economy right now >> okay. john kildof laying it off down and breaking it all down thank you so much. next hour we continue this conversation because we have tom fanning on the broadcast from southern company. he said jugular didn't he? >> he did. >> i heard this on another network. if you're attacked -- >> attacked? >> -- by a group of clowns, what do you do? >> go for the juggler. >> i did hear it on another network but it's -- >> i already said jugular. but it's awful good. you got to admit if the clowns come after you and

you want to survive go for the juggler. >> i got one for you, by the way, that i just learned where does george washington keep his armies? in his sleevies. >> that's good >> it's in the same category. >> those are the best. those are the best coming up, small caps have outperformed the s&p 500 over the last year and our next guest expects the trends to continue she has names to watch for your portfolio. "squawk box" is coming right back offers investors a broader view. ♪♪ we see companies protecting the bottom line by putting people first. we see a bright future, still hungry for the ingenuity of those ready for the next challenge.

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securities jill, one of the things i noticed that really informed your thinking on a lot of these things is that we've moved midcycle to late cycle that's the stock market itself, that's the economy, that's both? explain that and what are the implications of the late cycle behavior >> sure. thank you for having me. one of the macro indicators so trying to figure out where we are in a cycle based on the

early, mid, late down turn we've been on the midcycle environment the majority of this year midcycle is a phase to the last between months and back to what works is quality lower risk tends to work. you do tend to see value work in small caps consistently we found rising versus falling covid cases have been a style of those cases instead of the macro and regime in the case delta variant and

things are getting better on the var yont front where we could see small stock caps and value in the later months. >> has that been the economy finally starting to get overheated interest rates are so low, i would think previous late cycle behavior would happen with rates at such levels i don't know that uds see the typical cycle behavior because rates are so low to start with >> right, we've been in an unprecedented market environment in terms of liquidity. they've been a bigger driver of the market than you've seen for most of the last decade. we are not expecting eminent tightening

we do expect the fed to announce a taper and eventually the fed will title rates are at relatively low levels but rising. in the environment that we are in the back drop of the rate cycle. investments that still offer a healthy dividend and one that will grow that dividend as rates rise and sectors are more insulated so energies and financials are well positioned small caps over large caps and more of the domestically oriented areas will tend to look more a prak tiff in our view when we think about the long-term investments and given where valuations are today with equities and they don't tell you much about what will happen in the

short term versus the long term. valuations today where long caps are relatively cheaper would suggest you start to see healthy annualized returns versus for large caps given extended valuations are, we could see more flash returns over the long term >> health care ranks last. thank you, jill. b of a securities. we'll check back and see if we are in the late, late cycle eventually some day. when we come back, as the supply chain crunch peaked or could the holiday season still be in trouble. the president of american plastic toys will join us with his struggle just ahead. and southern company ceo tom

fanning will tell us about the energy crisis grippingthe globe. you are watching "squawk box" and this is cnbc i've spent centuries evolving with the world. that's the nature of being the economy. observing investors choose assets to balance risk and reward. with one element securing portfolios, time after time. gold. agile and liquid. a proven protector. an ever-evolving enabler of bold decisions. an asset more relevant than ever before. gold. your strategic advantage.

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wall street ready to kick off a week of big earnings commentary around supply chain speaking of supply chain bottlenecks. a look at what may or may not be under the tree this christmas. speaking to the president of american plastic toys. bitcoin's boom showing no sign of slowing down as wall street prepares to welcome the first crypto etf what investors need to watch starting right now good morning and welcome to "squawk box. yes, we are wearing pink this

morning. all pretty in pink but we are doing it in observance of breast care awareness month >> i was worried about you you don't like to wear colorful ties >> i had it. i think i wore this particular tie at a wedding i was one of the -- >> groomsmen >> i think we were all given these ties to wear and a khaki suit too >> there is a reason you would never

that tie from the white house with the twitter birds >> i have some with oil rigs i wear them still once in a while. and i understand look at mr. wonderful all black ties >> wearing it for breast cancer awareness. >> i'll steel becky's line from last hour. dow jones a shade of pink.

all red. dow off about 100 points, s&p off about 15 points. bitcoin trading six month highs. the first bitcoin etf's could start trading tomorrow bitcoin has been surging in recent days and will in fact make its debut tomorrow. won approval to own a 51% stake in that china business in 2004 did not disclose how much it is paying to acquire full ownership. check this out did you go to the movies this week "halloween kills." >> i saw the first half hour i loved the first half hour. >> number one at the weekend box

office taking in $50.3 million very strong debut. notable because the film was released simultaneously and on nbc universal's peacock streaming service. nbc is of course the parent company of cnbc. >> why did you watch the first half hour? >> i can't watch it when people are around it is a beautiful day and you are watching "halloween kills. >> not going to give anything away if you watched the last one where you are pretty sure that

he was killed in the fire and jamie lee curtis is waiving her arms saying no, no don't put that fire out and then the firemen go in. >> don't you want to watch the movie just for the music >> i'm a scaredy cat i would actually watch it in the middle of the day. >> been 25 years since "scream" came out after the much stronger than expected retail sales number, it appears the consumer has rescued the gdp number steve joins us now with the latest read for the fourth

quarter and beyond >> forecasters were encouraged by the friday retail sales report and see better growth ahead. seeing the average third quarter to 2.9%. would have been worse without that september retail beat that huge optimism where we open and all of that was down seeing the resumption of the economic rebound in the second half of next year. 4.9 and 3.8. saying the consumer is in good shape. household wealth and consumers picking up significant accumulated excess savings for the year

an above trend because consumer balance sheets are in good shape not seen as the biggest problem for now an at least at current levels >> the bigger issues will be keeping the economy open and being able to make enough products and services available. stanley says his forecast is based on there not being another covid surge that shuts the economy down this just in, the market moves forward. here are the latest probabilities, a greater than 50% probability. moving from september to now talking about the summer hike to around 44 basis points the highest since march 2020 when the fed was cutting rates and now they are back up44

a complicated world. you've got a supplied bottleneck that could hurt growth so they might want to stay easy but that fuels the fire for the demand of the bottleneck and inflationary fears come they are dammed if they do and dammed if they don't i don't know why jay powell even wants that job >> i think he does even more complicated

the idea would be not to keep the policy easy but maybe to move back on the stimulus they wouldn't be able to overlook or power through or purchase the latest stimulation numbers they were saying we are not worried about the inflation because of the savings rate and job market right now >> that sort of ignores what was happening with retirees all along saving money and making sure you are putting enough money away when you start seeing cola increase, that tells you what you thought you had put away isn't going to be enough >> i thinks that right

there is definitely a buy as in fed policy i'm gonna get a lieutenant of bad mail on this the treasury market is not an entitlement program. i don't know that as a matter of policy, what we want to be doing is increasing and keeping rates high because of the effect on seniors and savers >> i don't think we are keeping them high. i think we are keeping them artificially low to increase the growth and help the larger number of people in the economy. >> if somebody doing all the right things isn't concerned i understand your broader point.

i wonder if there is a point where you say, my gosh, we do have to worry about that group >> steve, we have to go. i leave my sirius fm have you been on the fish channel? it is like a grateful dead concert. >> i've been listening more and more to the fish channel >> i don't like their lyrics or songs as much but by the way -- >> i can see you going to their concert and doing acid like you used to and just sitting there for hours and hours. am i giving away too much? >> how am i supposed to respond to that. you want to go to phil tonight

>> he's channel his own experiences. >> phil is he there? >> at the capital theater to night. >> unbroken chain. will you be yelling that >> with the lighter. >> exactly you use your phone these days. >> when we come back, will the supply chain and labor issues ruin the holiday season? hearing from the american plastic toy maker and some of their big customers, five below, walmart and more "squawk box" will be right back. that's why cisco is committed to achieving net zero emissions by 2040. and we believe our smart buildings solutions can help.

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welcome back, toy manufacturers are racing to get their products on toy shelves. with global problems along with issues finding workers, a lot are focusing on less labor needed toys. joining us, the president and ceo of american plastic toys manufacturing toys here in america for about 60 years or

so >> thank you for having me >> sure. let's talk about what you face you manufacture your toys here in america but you've been running into issues too. where do things stand in terms of how difficult it is and where you are facing bottlenecks >> we have trouble getting product to market. we have some loads on the truck more than a week raw material costs have been extraordinarily high this year on top of that, we go back to the supply chain where we've increased two fold and three

fold one of those key positions we have is hiring getting back after multiple pay increases after hiring people to actually put the toys here domestically >> you've got five facilities here in michigan how much do you pay workers and how much has that gone up? >> close to 15% -- >> 15 or 5-0 >> 5-0 percent retention bonuses, sign on bonuses. some equate $2 an hour just for coming in to work all five days a week layered on top of a good strong

base hourly rate becoming difficult to hire and maintain our team has done a phenomenal job of scheduling interviews sometimes they'll schedule 10 interviews and two people will show up. apart from the supply issue, that is the most challenging issue we have. >> why do you think that is? >> i think the supplemental payments from the federal government really hampered that early in the process now, i'm not sure -- i'm afraid in some cases, the american worker may be hesitant to get back to work we have a great staff and wonderful employees who have stayed with us from time to time it is a puzzle quite frankly,

i've talked to other presidents and other managers and other industries and it is a puzzle. we are not quite sure what's holding that back right now. >> your costs have gone up how much what would you say overall >> plastics at one point, it is starting to retreat. plastics wither double than 12 months ago >> is that because of the weather in houston and texas over the winter? >> yes part of it but the chemical companies were pretty crass saying they are just expanding margin had i used that excuse going into walmart or walgreens, they probably would have held the door open for me and packaging has increased from high single digit to low double

digit percentage >> you are talking about toys that don't come with a high price tag. are you able to raise your prices to get that back or are you losing profit on this? >> it has been a strain on profit we are negotiating programs right now for christmas of 2022. that's a little bit of a puzzle when you have to go back to retailers and offer them an item that retailed for $20, $25 and offer it at maybe even $40 >> one thing we have seen go up. toy spending was up 17%. i read it was up 40% as people made sure they had things to do when their kids were at home >> that's right. one of the most frustrating

aspects of this. it has been a phenomenal opportunity. people have come to us and we've had to turn away orders because we didn't have enough people or couldn't hire enough people. i couldn't accept additional orders when i had to work and do everything i could to satisfy the orders we had already booked ahead of time for customers months to six months ago in some cases. i can see all of the things you've been talking about up to this point are coming through because our spring or easter time business for 2022 is very strong retailers continue to be concerned about the logistics and supply chain snag we have on the west coast and other ports of the united states >> the fed is constantly trying

to figure out if this is transitory if you are making your deals for winter of 2022, what do you think? do you anticipate the prices will still be high at that point? >> yes, i do i think some of the raw materials and packages may be plateauing that market may be adjusting and setting down a little bit. when we talk about transitory, whether it will be transitory it will not be a way to put it. saying, okay, we are going to stop paying you. take a dollar out of your wage i thinks that going to be a driver for making inflation less transitory going into 2022

>> thank you for your time and insights we hope to speak with you again. we know this is a busy season. we are watching closely. >> thank you for having us good luck. >> you too okay when we come back. oil prices hitting their highest levels as demand continues to improve. a lot of problems on the way speaking about energy prices, the economy and so much more when "squawk box" returns right after this my son romeo has sought counsel with some strategic advisors. they suggest that we marry our fortunes with...the capulets. blasphemy! fear not. these advisors managed one of the largest mergers in history, creating billions in value. billions? plus, they have experts in global trade. this merger shall be a boon for our spice business. and set a course for growth. here, here! friars, send word at once. yes, m'lord.

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still to come, southern company ceo joins us to talk what to expect this winter and bitcoin surging past 60,000 in anticipation of the approval of futures etf. stay tuned, you are watching "squawk box" on cnbc

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oil and gas prices continue to rise. join us to talk about what we can expect this winter tom fanning from energy giant company. you've seen not only in europe

but china and other places around the world how tight they are. could that ever happen here. could people in the united states see a tripling of energy prices in midwinter or that could never happen here? >> joe, you could never say never, i guess >> it is way more unlikely what we are seeing in america is this notion of energy and transition as big and complex as that issue is, we have these factors at play, a lot more renewables, a whole lot less coal and natural gas under pressure there's an interesting number, 50%. investment is down 50% for things like e and v and pipes. exports are up 50%

as a result, surprisingly at least in the spot, prices are up about 50%. we think that is temporary but the markets will adjust, the facts are heading into the winter, storage is down about 5.5% the rate of injection to replace the below normal storage is down 8% a lot of that on weather but man oh, man it is a very interesting time market structure is a big deal the notions of making and more energy in the southeast is about alabama power and/ orgen power

and more on. i can only point to texas storm and you can only get into problems in the tales of weather and supply disturbance >> how much of southern company is coal? and how much of the u.s. is coal are you in single digits in most of the united states >> not yet in single digits but headed thatway before i became chairman of southern, we were down 70% the unintended consequence is

that coal becomes more economic. in recent weeks, coal production has bumped up 20%. how long that will persist gas prices are $5.35 down to about four in the month ahead. >> you saw the gasoline lines in the uk do you foresee any of that in this country again that's possible, i guess, if we keep the pressure on the majors to not use capital isn't all of this possible. >> if you just let these energy markets play, you could have all kinds of volatility. it is bad for the economy. let me give you the reality.

in the southeast, we are moving to a structure where you tell me what year, 2025, 2050 where we'll have 50% of energy coming from renewables in the southeast. we import our wind from kansas and oklahoma it will almost all be solar. during a winter day, the peak consumption period will be in the morning. when people get up and go to work 7:00 a.m. that's where you'll have a peak demand curve how are solar doing at 7:00 a.m. in the morning, not running. what we have to do is back that up with storage or natural gas natural gas could be very peaky during those times i don't need to hand bouquets

out to regulators, this has allowed us to have higher reserve markets better than normal when we need it in peak period like in winter. they've done well. those factors really don't work well in the so-called organized markets. one last point is reliability versus resilience. this nation has built its energy complex on the idea of reliability. that is how your system operates in normal times. the idea of resilience is where we are moving. that is the tales of weather or supply will going to get more volatile resilience picks up the idea of how your system operates during abnormal times we have to plan more and more for that in energy of america. >> you mention the energy

structure in the southeast has allowed you to do that i read the story that said, look, the new rules there said you can't have gas powered or diesel powered generators at that point how would you compare the regulatory pressure to some place like california? >> i get the good will behind some of those. here again, this business is a long-term investment and long-term result business. we have to understand what the pace will be so that we can adjust in a rational way the math of supply and demand. we can't do that without rushing into certain policy decisions. we do need to be thoughtful about thousand these policies

work that's why i think integrated market structures work so much better than the so-called organized markets do >> clean coal, natural gas, how clean can you make coal? >> you are in the world of carbon capture and storage to do something with carbon. here is where i think we go. colby a whole variety of regulations is going to go away in america you tell me when 35 or 2050, i don't know >> i'm not worried about america. i'm worried about india and china. great. here we are and here is the globe. >> send it ironic that a lot of solar production comes from china and that is largely based

with coal fire and energy. >> is it your forecast that in 2035 in the southeast, you'll still find the best college football players >> no question about that. we just need to get them to georgia tech georgia tech that's not the georgia people are talking about. one last question since you are in atlanta weren't the braves up on the dodgers 3-1 last year? >> joe, this is a different year those that live by predicting the future by looking at the past are in for failure. >> just watching closely big win last night 2-0. >> we are on our way, man. >> yeah? >> you bet >> it is fun to watch. >> tom fanning, thanks >> you look like you were really

listening about my 2035 question something about the water down there. not alabama or clemson then it is georgia but what about cincinnati >> cincinnati, third in the nation or second >> second. i wonder how much longer that coach is going to be there not much longer, i bet coming up, the first bitcoin etf expected to begin trading this week. we'll speak to gray scale ceo about what investors can expect and we are on apple watch. holding a product launch that will likely include new versions of the mac sh we are right back after this

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welcome back shares of zillow under pressure after a report the company has temporarily stopped their home buying service because of

overwhelming demand. sort of their version of flip this house questions about how easy it was to sell those houses again later. that stock down by about 6.5%. coming up, bitcoin's boom as well street prepares to welcome the first crypto etf "squawk box" will be right back.

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now the first bitcoin futures etf. joining us now to discuss more gray scale's ceo this does seem like potentially an inflationpoint. more on what could happen in anticipation of this and then the view are that this is just

the beginning. i know it is your business but where do you stand in the short term >> i'll give you the sun and shine or gray scale view this stands to be an important week investors have been waiting for the etf to debut this has protelled us back as open esed to the price of bitcoin. there is a distinction in this way. what do you think it means for the possibility that sec or government will continue to think about or will regulate to call it that >> i've been on the show talking about this before. clearing the way for the bitcoin

etf. we believe because the futures and spot prices are related. pricing has always been one of those hang ups working for years, we stand ready to file and bring another option >> do you think there is any chance they stop it between today and tomorrow. >> really a process that of course anything can happen here trading on the market as soon as

tomorrow buying the underlying asset coming in to regulate that i know what you are hearing and so many people working behind the scenes to various agencies about this i t i think there is a lot of excitement about bitcoin allowing any of these there is going to be things like roll cost and if there is a commodity that can be stored easily like gold can, they can access through that product there may be oil that is perhaps harder to store so it is too early to say as we access those

from futures one of those places to go was your fund, now how about something else >> today, this is the gbtc today this is the largest fund so i think the successes of this probably over the last year is evidenced that a -- want to access this, and ultimately having both those options in the market i think is a good thing for the ecosystem overall. >> you know i have always complained that the fees on your product is too high. does that put any pressure on that. >> we come into a market with the etf, we stands ready to reduce fees certainly there will be fee pressure, but it's too early to see what the landscape is going to look like. >> in terms of just price

action, if you can't, opine on where we are, as i said at the top, there's sort of differing views, one because there's been an anticipation this moment will happen others will say, no, no, no, no, this is something very different. >> it's not so much about price, andrew, it's more about did you gettal assets. investors are really looking beyond just bicoin and e ethere. so you have products for z-cash, horizon and stellar, so as people think about exposure, it's all about diversification, and now they'll have additional tools. >> when you look at the other companies that are putting

together etfs and other things that look a bit like this futures exchange, would you ever do something like this straight up >> the grayscale team would never rule anything out. we're always toeing a healthy line about what investors wants and need while listening to demand and where and how they want to get exposure never would rule it out. >> do you have a price target on bitcoin? >> come on, andrew, you know i don't put price targets. if i look at who is investing, the excitement around the industry, it's very opportunistic outlook. >> i know that, but can good you give us a sense of where you they we are genuinely in the cycle. there have been great summers or

s solstices, and then there have been long winters. >> i think the familiar yates and protects of an etf definitely stands to draw in more capital and more investors into the ecosystem gbtz, there's a lot of ways for investors to access this asset class, but as you have more entering into the market, that could be bullish >> do you think there's any chance we could see an ethereum etf futures product? >> i think the regulatory community has become increasingly comfortable -- >> if you were to sort of handicap how the s.e.c. o others might think about ethereum futures product versus a bitcoin

futures product, how would you talk about or frame that conversation >> well, regulators have been very proactive working with industry participants like us. i think they have taken their time and been methodical about introducing what will be the first bitcoin futures product, so i think it stands to reason they will also be proactive and thoughtful about bringing other products into the market as well >> do you think this makes it harder for the chinese crackdown though continue? >> what we have seen out of china is another round of prohibitive class against the asset class. time and against the resiliency has moved to other parts of the world, and i think we're seeing another cycle of that, as we view as a good things. this smooths some of it out and not have it so concentrated. >> michael, great to see you we'll see what happens in the

next 24 hours. >> thanks, andrew. and a couple stocks to watch. disney now after barclays downgraded it, citing concerns about a significant slowdown in growth no its streaming service. supermarket operator albertson's offered an adjusted, beating estimates of 45 cents a share. it also increased the dividend by 20 purposes and netflix estimating the value of its series "squid games" at nearly $900 million. it cost just $21.4 million to produce. >> that's a big deal, big sleeper. >> i don't know. >> i didn't watch it. >> i watched one episode. >> was it too gory for you >> nothing is too gore i don't

i don't know i have to watch the next one it's kind of crazy my daughter says it's like the greatest thing ever. my son, though, he's not -- i got a split decision i'm going to have to decide myself. >> no, i don't want to watch it, honestly. >> you don't want to watch it? >> no. it's gross. >> a lot of blood. >> there's a lot of stuff i'd like to see, that's not at the top of my list. we'll get you up to speed for the trading week ahead the futures are a little under pressure the dow had its best week since june, but this morning the dow is indicated down by 102 points. plus we're also going to talk to new hampshire governor chris sununu, on his stance on

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to a lower open when the bell rings in just 90 minutes meantime, bitcoin trading near record levels, the world's biggest cryptocurrencyie has doubled since the lowing in the summer, and we're standing bit for the expected first trading of a bitcoin etf the final hour of "squawk box" begins right now. good morning welcome back to "squawk box" here on cnbc, live from the nasdaq marketsite? times square. >> there's a lot of action out

there. >> what is happening >> i don't know -- >> i think there was a stage there. >> it's a she-shed >> a bunch of stuff scored in there. look how they're sticking it right behind -- >> can't seen see it from that site. >> i see, i see. is that today? >> that is today that is today. >> you know what it's really different than a year ago it's wild out there. >> a lot of people there's a lot going on >> it's a cross-roads of the world here with you, as equity futures are down triple digits, a good day on friday, as you recall treasury yields, with a quick look oil is definitely a story we're watching as well bitcoin, we're expecting an etf

to begin trading, possibly even a day, right at 61,000 or so for the crypto, the leading crypto 61,000 you've got to -- if you're going to buy one bit counscoinbitcoino save up. >> yeah, but they're buying it in fractions, that's what the kids are doing i'm a dope, no question. >> i know. i talked to both of you, begged. >> i remember sitting with brian armstrong, probably 2012, the winkelvoss, and it was only ten pages of the bitcoin standard, and i thought wow, this is real.

>> cramer bought a farm. >> he bought -- >> hi bought a farm, not the farm he did it, because i said i'm going to take my winnings and put it into some real, though he still owns ethereum, too shares of disney down in the premarket, barclays downgrading the stock. moffett nathan son being too optimistic we're going to be speaking with the analyst behind that call in just a few minutes and then there's zale on ahead of the opening bell. the decline follows a bloomberg report that the company has temporarily stopped the home buying service because of overwhelming demand. maybe in the broader market for homes, but we'll see, but that stock down by about 6.8%

goldman sachs getting approval from chinese regulators toin a business it's co-owned since 2004 meantime, after more than a month of market turmoil, major averages showing clear signs of life last week, posting their best weekly gains, and now, yep, we are headed for historically what's been some of the market's best months. still, there's a bear case to be made mike santoli is here to tell us about what it is. >> actually last week put the bears back on the defensive. the market made a case it had done a good job of discounting, and perhaps what the fed is going to do. technically if you look at the s&p 500, it did win over a lot

of skeptics. we also got investor sentiment pretty negative, so people are wonder if we see something like in late october of last year, where there was a durable bottom made after that month after a correct in september, and as you see, it created a scoop there, you know, put some distance between us and the lows. now, take a look at some of the biggest stocks in the market on the nasdaq it's a mixed bag in terms of whether we see progress being ahead of us for the s&p itself look at the advantage that facebook has given up in the last few months. it looks like it might firm up today. apple, amazon, the market has done what it's done this year. these three stocks, by the way, are about one eighth of the index, 2u8ly a drag, make that's a positive for the rest of 9

market the inflation story is not going to go away take a look at how inflation-protected has performed of a similar maturity, so on top here you see basically people are bidding no the forward inflation protection, this spread does tell you something about how concerned people are about it, whether it's in fact all discounted. i think the bear case largely rests on more of the same, a disorderly rise in bond yields, as people get worried, and then, you know, we have that slowdown news out of the china. that also is kind of coexisting with this inflation surge globally people are a little uncomfortable with that combination. i think the market gets the benefit of the doubt after last week, but you can never be sure we're free of the risk. >> what do you take away from earnings season so far >> yeah, it looks like estimates

once again are significantly too low. we didn't know that coming in. forecasts got shaved going in, right now there's still a big margin to beat i think the key thing, though, is what companies -- this will be nonbanks, talk about in terms of profit margin pressures right now the 2022 projects say we'll be at report margins, that could be at risk if we think the cross-pressures are going to persist or they've got to hire a ton of people at a higher wage. >> mine santoli, thank you i think your tie matches -- it's a shade of pink, because we are -- >> as close as i could get >> we are in breast cancer awareness month, but in the pink, as we put it. >> i was hoping it was, you know, close enough on the spectrum >> it's like fuchsia

>> we're going to give it to you. >> not too far off my sweater. anyway, to join us more about the earnings season ahead and whether the fourth quarter will be kind to investors is kate moore, ahead of thee mattic strategy for blackwok's global strategies team. i think what we have seen in earnings so far has been a bit of a surprise. so many people are wondering if things would fall apart. last week was a very strong week for the markets. it was because of what we saw in earnings. >> just listening to what mike said in terms of focusing how companies are talking about the margin pressures into 2022, that is the number one thing we are focusing on as we go through this reporting season, how do we talk about labor shortages, talk about supply chain disruptions, but despite all of that, that angst we've had in regards to those three pressures, i think you're right we've had a much better than expected beat rate for the third

quarter reporting. i would caulk, though, we are very early in the stages, and we have a lot more companies across a wider range of industries to report that said, i don't want to ever bet against corporates we may not get new margin highs, but we have seen companies do a fantastic job of managing their cost, streamlining where necessary, and really managing to the bottom line i don't think this we're will be different. >> kate, how much of that is because consumers have cash and they're willing to spend it? mean that companies have pricing power, too >> yeah, companies who have pricing power, obviously the most interesting for us at this point. we really do have conviction in the consumer as well as the potential for corporate spend. there's been a bit of a narrative, say, over the last month or two, that growth is peaking, rolling over, we need

to be concerned. we have been more constructive on that, yes, maybe the sect derivative is coming down a bit, but we are still looking for a good expanse throughout next years, consumers have incredibly healthy personal balance sheets, as are businesses, so i think you're right, becky, these things are contributing to a strong revenue growth profile. >> we spoke with a private companies earlier, an american toy company that makes all of their toys here in the united states, but they are dealing with lots of issues. they don't have to deal with ports or trying to get things from overseas, but they're dealing with higher plastic also costs, much higher labor costs up by nearly 50%, and they're being asked to make their plans for next winter. t he thinks those higher costs will remain more than a year from now does that concern you? or was that something you already were anticipating?

>> you know, five, six months ago, i would have been in the camp that the inflation was transitory, and related to the restart of the economy following the pandemic, but now it feels like there's broader, more durable price pressures percolating across a variety of industries so i think it's fair to think that inflation will stick around for a bit longer prices are unlikely to come down dramatically the thing i'm watching the most is around wages. it can be more challenging for companies for navigate one of things i'm listening for as wee reporting, is how companies plan to deal with the labor shortages. are we making invests to offset that, or what they have to do to retain their employees that will tell me a lot about

where margins go from here. >> if the answeris they're spending more, offering more benefits to keep their employees, what does that tell you? >> they'll have to cut costs in other places if we want to continue to deliver on earnings. we need to have, then, show companies to be quite nimble over coming quarters this is the important thing, you listen to the comments you just made, and thinking about, you know, as we go through reporting here, companies may not have full visibility into their future prices, or into some of the other pressures like taxes, for example, that may come out in to 22, i don't expect huge changes in their guidance, even as they beat expectations. i think they're going to wait. that may mean that earnings revisions don't move as aggressively as they had in the last quarters, we're in a bit of a holding pattern.

i expect more volatility in the fourth quarter. >> more volatility caused by what >> from prices mork volatility perhaps playing out in the equity markets as rates and equities readjust. so more volatility, mean you wouldn't invest more you wouldn't necessarily sell anything, but you wouldn't put more at work >> we're overyeah on equities, but we're trying to be more opportunistic where we add when we gull pullbacks, for buying into high-quality companies with pricing power, but, you know, in the big rip upwards, we're not aggressively adding to risks. and we'll have better opportunities to take a bite at the apple. >> you like technology there have been some people concerned about technology if you see interest rates starts to go up, it's less of a great

environment, but you like is very selectively >> i'm still bullish on software companies in general, they fall into the category where you see more of them trading at premium multiples relative to the rest of the market, therefore would be subject to multiple contractions that said, most of these companies don't face the same types of supply chain issues or pricing pressures we are seeing other industries, and demand for their products is incredibly high i feel like a lot of the software companies will more than offset it with higher earnings that's a place i like. we've talked about security software, cybersoftware in the past that's a particular area of interest, but i'm seeing cloud-based providers across a variety of different services, despite their high multiples. >> kate, thank you great to see you this morning. thanks so much, about ecy.

>> kate moore. coming up, a debate over vaccine mandates at the state level. we'll speak with the new hampshire governor chris sununu, and what to expect at the apple event today. the only hint we've gotten -- the rdwo unleashed stay tuned you're watching "squawk box" on cnbc ow your business. you can't be in two places at once, let posh answer. posh virtual receptionists. at vanguard, you're more than just an investor, you're an owner with access to financial advice, tools and a personalized plan that helps you build a future for those you love. vanguard. become an owner. paola needs a parachute. so, salesforce customer 360 unites your marketing,

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coming up, a question that's revealing some division among republican governors -- should businesses be able to mandate covid vaccinations for their employees? we'll speak with new hampshire gop governor sununu. this weeks marks the techbt anniversary of "halftime report" on cnbc, scott wapner has a lineup to talk about the markets and their investing ideas. carl icahn kicks things off today. it starts at noon eastern time day. stay tuned, you're watching "squawk box" and this is cnbc.

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we just heard that general colin powell has died at the age of 84. eamon javers joins us with a look at his life and legacy.

having some audio difficulties i would have opened -- >> -- vaccinated --okay. >> can we start over can you start over, eamon? >> sure, joe colin powell's family putting out a statement this morning saying he has died of covid complications. they say he was fully vaccinated, colin powell, of course, the former secretary of state, first african-american secretary of state under george w. bush, and served as the national security council director enormously influential in republican circle, but policy-wise, drifting away from the republican party toward the end of his life. powell, a military man through and through. he'll be known for his legacy in the united states military, and for his achievements there dating back as far as the first gulf war he'll also be known for husband

advocacy for ultimately the invasion of iraq as well, joe. colin powell dead at 84 this morning from covid complications. >> for more on the life and legacy of colin powell, new mexico governor sununu you were booked to talk about vaccine mandates in your state, but i'm sure you knew the general, general powell well i know your father must have known him very well. >> well, without a doubt they had a close working relationship in the first bush white house. it's a loss of an incredible american, an individual that gave himself to this country, gave himself of service, served in multiple administrations, had a chance to retiring and go into the private sector, be he understood his role in terms of what he could cover. it's a legacy of service that's unmatched when you look at what he's done over a span, not just overseas and not just as a

general, but as the secretary of state. he always brought a calm presence every time he walked into the room, even in very tough situations i think, if anything, that's what this country needs. that the the legacy this country needs to remember. even in tough situations, you have to come in with a calm presence, make firm decisions. it's a loss for this country without a doubt, and something i don't think we'll be shaking off for a while. >> but served on a lot of corporate boards, too. i think of those traits you just described translated into the boardroom. he was across an array of businesses in corporate america. >> who wouldn't want his help? who wouldn't want general powell's background to pry some of that leadership whether it's a small business, and he was alwaysling to do it to lend of helping hand. he believed strongly in the values of this country he put his life on the line for this country in many situations,

and he continually gave of that service. that's just one thing we're seeing in 2021, with all think vitriol and anger, let's remember that calm presence, and that legacy that general powell leaves behind. >> as we mentioned, he was, quote, fully vaccinated, and we don't know at this point whether that would -- >> -- you point out since he was 84. >> likely he got vaccinated early on, absolutely i would haveimagined given bot his ages, his stature and everything else. >> look -- >> go ahead, governor. >> look, we all know the vaccine is incredibly effective, one of those effective vaccines out there, but every once in a while you have unfortunate breakthrough cases that's why they're looking at boosters, making sure folks have that availability to -- he was older, in his 80s, that brings

other medical fragility to bear. that's why you want to say folks to make sure they have first at the trough, if you will, but its unfortunate, every once in a while, you hear of breakthrough cases, they're rare, and unfortunately it hit one of our brave americans that served this country so well. >> it's not a therapeutic. it's something that stimulate your immune system to tackle and handle covid, but it's only as good as your immune system so a breakthrough is what it's called, but it's not like the vaccine wasn't infective. >> gosh, no. >> governor, we want to talk more about obviously the general, but in your state, you have -- i'm trying to figure it out. you go against some of the other republican governors you're not against necessarily businesses mandating the vaccine, but you're not sure the

president should be able to mandate businesses to mandate? it's a nuanced stand can you explain it >> yeah. look, it's not nuanced at all. as an executive, whether you're a governor or the president, you cannot swipe with a pen forced mandates onto private businesses the biden administration is trying to enforce these through on or abouta new hampshire will join the lawsuit against that, but one of the foremost responsibilities as an executive is know the limitations of that power. so what i have a lot of problems with is othergovernors, republicans or whoever is trying to do it, to put in mandates on the other side, to say a business can't mandate a vaccine. that'sen the the infringement on the liberties of businesses. the core conservative values are the individual liberties governments should not be telling businesses to -- i'm as pro-vaccine as they come it has to be a choice. if a business wants to say you

have to get vaccinated to work in my business, that's their choice it always has been those rules have not changed, should not change. you can't have it both ways. i don't think the biden administration should be forcen mandated vaccines. i don't think governors or other entities should be forcing businesses not to allow -- i ran a business i can't imagine if a government came in and said you have to keep these people hired, or you have to get rid of these people. that's not their business. you have to be consistent. this is what makes america great. you can't play both sides of the coin just because the ends justify your means >> governor, when you think about that, and you think about your state, for example, there are obviously additional costs, significant costs to the state for people who suffer from covid-19 taxpayers ultimately suffer at the same time, because they're going to pay, in part, for those

costs. how do you think about that element of it? >> well, you have to manage the costs, to be sure, whether it's some of the assistance that the federal government is offering to bring, and it's brought a lot of assistance. we're grateful for that. new hampshire has very successful -- we have one of the lowest hospitalization and lowest death rate in the country, strongest economy we found that balance, but it's part of that live free or die spirit we have here in new hampshire. you can't say live free or die, if there are costs to it, there are costs to it. >> but i think that's -- >> you don't sacrifice individual liberties for the dollar. >> that's part of the question when the pandemic began, we decided we were willing as a country on a federal level to throw lots of money at this across the country, at businesses, at industry, trying to get that to as many people as humanly possible, irrespective of their own, quote/unquote,

personal responsibility, and now here we are at a moment where we're saying, actually well, you know, we're going to pay for the impacts of the pandemic and covid, but we're not going to necessarily ask you to protect yourself or not. we're going to ask you to, but if you don't, it's still on us you know, there is a conservative view that actually it shouldn't be. >> well, look, you're comparing 2020, to 2021. in 2020 we had states of emergency in every state across the country. we didn't have the tools in the toolbox. people didn't have the option to protect themselves, right? we kind of wrapped around some different mandates and things like that temporarily. we got the vaccine once the vaccine was available to everyone, the states of emergency comes off. it's individual choice individuals have the tools to protect themselves. >> do you thinki financial incentives or frankly

disincentives -- >> no, you're trying to link dollars and monetary value to health decisions on an individual those two things should never cross. if you have chosen not to get the vaccine at this point, the information is out there, hopefully you've talked to your doctor and you made that decision i may not agree with if as govern op, but it's your decision to make. >> but you're not for universal health care. >> no, i'm not effectively you are saying you are for universal health care, do you see the issue >> no, i don't, not at all you're not making sense. >> if you're arguing the taxpayers should pay for everybody who suffers from covid-19, but you're not requiring them to do everything in their power to protect themselves, and therefore the taxpayer in this rather. >> i'm not saying the government has to pay for everything. the government has provided.

private insurance is pay fog a lot of testing and resore. long term it will become the covid vaccine will become more like the flew vaccine, where your insurance picks it up that's happening right now this isn't a government pays for everything solution. i'm not promoting that at all. whether you're republican or democrat, you can't say we're against mandates here, but we're for mandates there a conservative value says the individuals liberties of those businesses have to be adhered to just because i want everyone vaccinated doesn't mean with the sweep of a pen i should be able to force it. we're going to fight what the biden administration is trying to do, you have to -- >> if a company decides to main dates it and if you don't get one, you get fired, did you say that that's a company's choice >> yes. >> it is. >> that is the company's choice,

whether you're fred's flower shop or you're a major hospital association. i don't like it, i don't want to see anyone fired, but a business absolutely has the right why would we change the rules now, just because we're dealing with covid doesn't mean you change the rules of individual liberty, right you have to protect that again, it's the private business if that individual gets fired or has to go to another job, that is that's business's choice. let's respect that as republicans, as folks who believe in individual liberty as individuals frankly need to be consistent that's my biggest frustration. on the republican side there's a lack of consistency. i have some individuals panicking out of the box saying you can't do this or that. there's got to be limitations to government, guys that's the most important thing. >> governor, thank you we appreciate talking with us initially about general powell as well.

>> of course coming up, when we return one of the jpmorgan's top equity experts will join us. and will apple's unleashed event -- we have a preview stay tuned ♪

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and any kidney or liver problems. help protect yourself from another dvt or pe. ask your doctor about xarelto®. to learn more about cost, visit xarelto.com or call 1-888-xarelto apple is holding an event later today, and it's widely expected to be focused on mac books. josh >> apple isn't say exactly what to expect simply coming with the tagline unleashed, that new mac books are on the way specifically it suggests that the company will introduce high-end mac pros running on its own chips rather than supintel processors the mac we know has been a

sta standout, and they learn to work from home, and apple would obviously like to keep that going, with about 9% share reports also indicate that apple has been hard at work on the next generation of the air pods 2, so we're waiting to see if they make an official debut. it's estimated that apple pods accounts for about 5% of sales joe, back to you >> i almost said match books. >> we just not mac books in the family, and now i feel like i'm behind are you really >> this is my constant problem i get the phone, there's a new phone. i get the consumer, there's a

new computer. >> the watch -- i'm glad i didn't get a watch. >> why i've got the watch. >> but you never wear it. >> that's true i've stopped wearing watches. >> in general? >> just as a thing. >> why >> i don't know. i haven't been wearing the watch. i wear a polar thing when i exercise. >> a heart rate thing. >> and you have my oura ring. >> i used to wear one of those things. >> absolutely. that's what i always do. >> unfortunately i was able to hide that thing. it's sad never mind. >> is josh still with us >> josh, are you there >> yes. >> a question on behalf of my children they had to me the other day, what is the next great innovation -- they're apple

crazy people, but they wantto know, what is the next thing they can actually do we've talked about the car and all of that, but i don't think -- you can innovate, but you can only make the phone so small, the computer so fast. is there some great thing -- i read alps speculation sites, is there something on the horizon >> this isn't for your kids, maybe they're investors, but i think investors are collude in, because they want if the mac can do -- the street doesn't think the mac business will do all that much next year, there's some bulls who bet with the new processors, the mac can surprise the up side. for your kids, we're a bit handcuffed apple does not tip its hand to the product pipeline i was talking to gene muenster he is placing his bets that at

the company's next big software show, which you would expect june, you may get an unveiling of a mixed-reality headset tim cook does believe that's the next great platform. >> the sorkin boys will be waiting. take a look at what's happening form the stock lower after multiple analyst notes and how a spin jooff of espn would impact the stock joining us is michael nathanson. good morning to you. >> good morning. now the questions are coming the questions are coming the company pivoted, saying

we're going all in on streaming, now the markets, not so sure >> i think the market got ahead of itself, and the early guidance did is any gave was during a pandemic. they did an amazing job of pulling demand in. now the question is, are the forecasts too high >> the last couple quarters, it's been slowing. we think growth is going to slow and where the growth is coming from >> so you take that piece and you put them together. when do we get back to -- right now we're about 2019 levels? >> no, we're below 2019. >> still below. >> we think next year -- so the fiscal year started for october

31st for disney. the parks story is phenomenal. that's not the issue here. that's not what drives the stock now, andrew. it's all about the disney plus story, which really drove disney last year, but people, you know, kind of are now questioning the forecast, but the parks story cannot be. >> le me throw in another part of the story it seems like it's been debunked, but our analysis says disney is not a xhaep stock and the market is very much aware of espn and the challenges we did the math hand spinning out espn plus doesn't create a lot of value -- sorry, espn. getting espn off your books may

make it easier for management to focus on more important businesses, but espn is a big contributor to disney's earnings, and given where disney has traded, it's not an agreasive move i our math said, it really is not an important lever that disney can put to get the stock goods. >> michael, it's joe i'm not a twitter fan, but every once in a while -- can you help me figure out -- this is a good point. can you get to $900 million on what "squid games" is worth? is that real how do you get to $900 million and someone written in, bitcoin is worth more? "squid games" is worth $900

million? >> we're going to find out tomorrow night. >> no, we're talking about 1,000 billion, aren't we -- we're missing a decimal point there. okay that's not a good question, in fact, but back to what i said, how $900 million >> we're going to find out tomorrow night, right? we're going to ask questions and say how much of that growth that netflix will get tomorrow night is sustainable how many subs did they add and then we'll look at the rpu in asia pacific and come up with some math. it's really hard netflix does not provide a lot of details, granularity on shows. we'll answer your question tomorrow night, how about that >> from what i have ahead.

>> hey, michael, just on this netflix doesn't provide a lot, i would say i'm surprised how much information has leaked around "squid games." they don't have to give up any of this information. they're doing this for investors. if you stone hearing about these tidbits, do you think the next release was a bad one? >> that's a great question >> you're totally on top of that we've been looking for data every quarter. i would great with you we would want to hear anytime we think a show is going to be big.

>> they did it consistently, right? to suggest that whatever they drop wasn't successful -- >> okay. michael nathanson with a breakdown of disney, thank you for your perspective on all of it. when we come back, ragi, an's chief u.s. equity sttestit's approaching fast stay tuned ♪ ♪ ♪ . digital transformation has failed to take off. because it hasn't removed

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matching your job description. visit indeed.com/hire this is lisa. matching she's a poshcription. virtual receptionist. when you're busy, she'll answer your calls and assist your clients. you can't be in two places at once, let posh answer. posh virtual receptionists. jim, here we go. new week, last week was a good one for the markets.

do you think we'll have more good news? >> i think it would be i think this is a fulcrum week historically next week is the week that the market starts to go up to year end. look, i think things are okay for all the banks doing well they tend to be a good arbiter of what is happening we have a lot of positive news about thesemis today, a lot of positive news about call them the facebook and company we had an interesting pride company on earlier

just that they are paying about 50% more, and they can't get enough people to full everything they're not stuck at the ports, but they are paying more for what they're playing with plastics, and he didn't think enough those pressuring will have come down. >> no, he said plastics -- he thinking, in terms of labor, he won't be able to take a dollar out. >> labor is tough. >> i to spoke rich allison from domino's last week, and he said the labor pool is not expanding. if we do any sort of stimulus from washington, who knows where we'll get people i think it's a strange moment where there are a lot of people who left the workforce because

of covid, and a lot of teem saying we're fine i think covid is in the mix. thank you, jim folks, we want to remind you that there's the new cnbc investing club. our next guest says people have been to negative here dubravko is here with us

some people are worried, where do you stand >> yes, the market has had a lot to digest. >> but we still think the broad are backdrop remains pretty well supported. the threshold has lowered a decent amount. when you look at a lot of stocks that are facing, and issues, they have come off a lot, so obviously a lot of focus will be on what they are saying about demand a lot of focus on when are they seeing -- do they expect to see some easing of misthey supply chain-related issues, but i think generally risk/reward-wise, we're in a decent spot. >> how much do you focus, though, on rates

as we've seen, there's been a creep up that may be a signal here, yes, rates, i think broadly, not so much a worry, certainly not at the current left when you by theme yeah, i think you have a lot of long duration type of stocks that are sensitive to what rates are doing. so, you know, high multiple growth stocks are sensitive. if things continued to move higher, you are likely to continue to be a rotation. so that's where i think the worry is, more from a rotation point. not a worry, but you can see sensitivities, so broader-speaking markets i think should be able to adjust >> how much is it thatted

companies will not hit the earnings expectations? or is it going to be the color around how companies see the fu future. >> i think it's more of the ladder i think the focus will be what are companies saying for the quarters to come, 2022, how temporary are these impacts? >> and your sense is it's temporary. you think supply chain-wise, some of the issues we are having, it's all transitory? >> i think we still live in a world of capitalism. >> commodity balances, i'm not so sure it's going to be resolved quickly not all fronds

i think as far as corporate world is concerned, demand i think remains good we're just seeing a delay. i think pricing power remains good i think the supply chain issues ease, but on the commodities size, that's something we need to continue to monitor >> so, final question, if you had to position yourself this morning, you would be doing what >> we continue to like the reopening theme. i think covid is still something that people are thinking about if the global covid rate begins to ease, travel, i think is a big theme, 2022. tied with that, banks some central bank normalization is good, and then energy. energy benefits from reopening, a lot of idiosyncratic tailwinds. so those are the areas we continue to really like and we

think risk/reward is the best. >> dubravko, thank you for your perspective. the futures, we are in the red. nasdaq off about 75 points some concerns, of course, about disney, that's weigh as bit on things let's show you the ten-year, 6.20 right about now bitcoin around 60,000. we'll see about that futures etf tomorrow, and of course, sad news about colin powell's passing this morning from covid complications. >> that's it for us. joins utomorrow "squawk on the street" is coming up after a quick break this broker is your man. let's open your binders to page 188... uh carl, are there different planning options in here? options? plans we can build on our own, or with help from a financial consultant? like schwab does. uhhh... could we adjust our plan...

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good monday morning. welcome to "squawk on the street." david faber is in l.a. with the mi milkin institute. our road map begins with wti, highest level in seven years. barclays cutting dis