it's thursday, october 28th, 2021, and "squawk box" begins right now. good morning, welcome to "squawk box" here on cnbc. i'm becky quick along with joe kernen and andrew ross sorkin. and let's check things out this morning with the markets looks like green arrows across the board, dow up by 45, nasdaq up by 61. the dow was down yesterday by .75, a decline of 266 points s&p down .5% and the nasdaq was up by up by less than 1 point. the s&p was down yesterday but that was from a record high. so looking at new numbers this morning with the s&p indicated up by 9. looks like right now the ten year note is yielding 1.552%, so

that's below the range we've gotten used to the last couple of weeks 1.6 and above. late last night, the house confirming that president biden is attending a house caucus meeting at 9:00 a.m. eastern time although that meeting isn't on his official schedule, his attendance in person is seen as a sign that party leaders are close to finalizing a deal on the spending bill. the president could use the meeting to appeal to house progressives to vote for the stalled infrastructure bill which has passed the senate. yesterday president biden met with budget chairman bernie sanders and key democrats on capitol hill later this afternoon, president biden will be traveling to rome for the g20 summit the president and first lady will meet with pope frances before the summit. other leaders won't be ait saiding -- attending in person,

including president vladimir putin and president xi and now a new move towards the idea of super brackets >> we're not going to necessarily tax gains that you haven't realized. >> but we're going to create some new brackets at 10 million and another at 25 million. might put a tax or surcharge at 10 million of 3, and then 25 on top. beck >> i think it might be a 3% tax on billionaires that they're considering too. 3% additional surtax we'll see what happens. >> my understanding is it's 5% over 10 million and then an additional 3% over 25 million. >> but at least that's a discussion on rates, and not unrealized gains which seems crazy.

>> did you read the journals really calling it a comedy to be just throwing these things out without ever explaining whether there might be any economic consequences or people moving or -- just a -- let's do this no, you don't have enough votes for that how about a carbon tax yeah no, we can't do that do the unrealized gains. no now manchin won't do that. let's do this. did you hear -- i think it was andrew, senate budget committee chairman, bernie sanders what world are we living in? >> he wanted a $6 trillion plan. >> and we have to get this done quick because joe has to have something to say in scotland. >> to me this doesn't signal this is close. >> don't know what's in it, just do it. >> to me it doesn't signal it's close on anything. he wanted a framework before leaving for scotland to say we have a framework for paying the

for this but the idea he has to go talk to the progressive caucus in the house and say please vote for this bipartisan infrastructure deal that both sides were able to come together on. it shows you they don't have any control over the caucus. >> andrew, here's what i want to do. >> okay. >> 15%, $2 billion and above, wealth tax. >> wealth tax? >> you don't do it a billion and above. 15% he's not a billionaire anymore. only worth 850 do it on two, they lose 300 million, they're still at 1.7, tighten their belt a little, maybe cut a few feet off the -- >> is that annual or one time? >> i'm ready to do it annual just to watch the rich guys. your buddy warren i want to see when he hears about that >> i'm going to think about that >> elon musk is not mad -- is not happy. have you seen what he's been

tweeting >> yes why wouldn't he? this is like keystone cops here's one last thing, andrew, let me say one more thing. the idea there's these two people that won't go along with -- there's 52 that won't go along with it and that 48, where's the 48 that are also saying there might be a problem? why only joe manchin and kyrsten sinema, where's mark warner, senator coons, where are the normal senators that don't have a problem with the process >> joe >> yes >> we'll agree to disagree on the following. the whole situation is a clown car happening. >> it is i love that you say that. >> agree to agree. >> we need revenue let's do it, 15% >> the problem is you can't have, quote, bipartisan support to go spend money you don't have and the problem, in truth, is that we have both republicans and now certain democrats who are very happy to spend money but not pay for it and so everybody sits around --

>> they'd rather do deficit. >> we want this, this, this, but every time we look at any option, that doesn't work, that doesn't work, we can't do that it's the opposite of what you just said. >> right. >> so i'm not sure where we're going to land. >> i told you, i'm ready i'm ready. what do i care for people that have over $2 billion >> i'm surprised that you're in favor of a wealth tax. >> i'm really not. i just don't want to turn into an entitlement state cradle to grave. >> i don't mind a surtax, higher rates for higher up. none of that bothers me, that's a legitimate conversation. >> start spending less don't spend more and pretend you're paying for it by picking a sector of the economy. >> let's go after drug prices. >> what i don't understand, though, joe, you're prepared for all these different things why not do the basics, deal with the

estate tax, clean up the interest piece -- >> those are all reasonable. >> doing some of the real estate loopholes. >> fund the irs to catch cheaters. >> you saud it yesterday, andrew when you were being cynical, remember you said i'm being cynical. >> which part? >> democrats get a lot of money from the hedge fund community. that's what you said. >> i agree. >> so they're not going to do carrying interest. >> it's completely disingenuous. the democrats that continue to have interest in the tax program, you should be a guest, anybody should be aghast but by the way, if the parties were flipped, you know, i didn't see certain people being as aghast the other time around so -- >> pretty amazing. >> i don't know what to do. >> there are people that the first bill that -- there are some people in the democratic party in the house that wanted

to start a 10 trillion and then they were giving concessions to go to 6,000,000,000,005 trillion there are really people that want to do that and think that there will be no negative consequences. >> bernie sanders wanted to start at 6. >> right the chairman of the senate budget committee >> can i -- i'm not going to defend bernie sanders but i will say this it's not the way i negotiate but there are people who do this, by the way i think our former president used to talk about this. >> say a lot >> the anchoring technique if you say something completely wild -- >> a clumsy negotiation. >> that's not negotiation. that's playing a silly game. >> i know. but it just -- you know, the hart of haggling taken to the nth degree and looks silly. >> 1.2 on the regular infrastructure and then now 1.75, that starts adding up at some point 3 trillion, doesn't it it's a real number >> i think your first point was

the right one. this is all happening slap dash in the last minute so these are complicated sorts of policies and procedures and trying to figure out how to make them work, how to make them loophole proof so you can't work your way around it. >> they came up with what to spend it on first. >> that's the -- >> here's where we want to spend it we'll figure out afterwards how to fund it >> i think it's ridiculous what a crazy caucus it is, how hard it is to heard cats at this point. >> democrat cats, republicans are zero. >> you have the one vote majority with the vice president voting in the senate so you don't have anybody you can lose and that makes everybody really powerful i think joe biden said it himself, everybody is the president when you go to the senate and you have such a tight mandate in terms of the votes you have there. >> maybe it's not a good idea to

do so much when you don't have the political capital or people in place to vote for it. i need one of these now after this discussion, you can never joke about antidepress s ants because they're for people with chemical imbalances that's very concerning. anyway, reducing the need for hospitalizations amid high risk results with covid-19, go figure researchers tested the pill because it was known to reduce infla inflammation, the drug is commonly used to treat depression and ocd, it was approved by the fda in 1994. and costs just $4 for a course of treatment and that compares to $2,000 for a course of antibody iv treatments 700 for merck's experimental antiviral drug the study involved 1,500

brazilians with recent covid infections 11% needed hospitalization versus 16% on the placebo. the cheap ygeneric may be complem complementary to merck's pill. >> it may stop the storm from kicking off to begin with. good to hear when we come back we'll get you ready for the big tech earnings due after the closing bell today, when apple and amazon both report we have that conversation next later merck's ceo robert davis will join us after the company reports in a first on cnbc interview we'll be right back. ♪ ♪

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catalysts on today's squab planner at 7:45 we'll get the latest decision on monetary policy the european central bank is not expected to change policy before december, that's when new economic forecasts become available. it's also a big day for economic data here in the united states we'll be getting the first read on gdp in the third quarter as well as weekly jobless claims and on the earnings front we'll hear from caterpillar, merck and our parent company comcast in the next 45 minutes or so. and apple is set to report at the closing bell they'll look at commentary for iphone for the critical quarter. josh lipton joins us now with

more >> becky, all eyes on the iphone that is still, of course, apple's bread and butter i was talking to gene munster at luke ventures. his iphone revenue bogey 42 billion that's ahead of the street some questions investors are focussing on, who's buying the new iphone 13 models is it existing apple fans or android switchers making the leap? when they do buy are fans skewing towards the higher end of that iphone portfolio another question, the ongoing chip shortage how did that impact supply this quarter also how do apple executives think it could impact iphone supply ahead in the december quarter. analysts don't think they'll get formal guidance on the call but they're looking for the commentary that tim cook and luca have been providing to the street >> what are you hearing, there's

been so much sort of noise out there about the supply chain issues, whether it's going to be impact apple, keep up with demand, what are you hearing from all the people you talk to? >> listen, the company's already warned a couple times they are impacted by the chip shortage. warned again on the last earning call that is a challenge, it could impact franchises like the iphone, ipad so we'll look at how it's impacting the next quarter and how they're navigating i. >> do you have somebody keeping you company there? >> i do. my 2-year-old just got up. >> sorry, way early there. >> she has very strong feelings about the chip shortage. >> tell her good morning from us at least you have somebody to have your morning coffee with. see you later, josh. apple one of the big names we're spotlighting today amazon and starbucks are also on tap to report quarterly results after the bell today

let's bring in kerry firestone, a cnbc contributor and kerry, let's talk about apple first up this stock trades at a premium to the market in terms of its market valuation is it worth it >> yes i think it is worth it apple, of course, is the biggest company in the world it's amazing that in a quarter they can produce $85 billion of product. the biggest manufacturing, biggest service company in a way in the world and what the market has done this year, it's really penalized apple because it's at the forefront of the supply chain issues it's underperformed the market by about 50% so what they have to do is beat the number, $1.23 consensus, show they're selling a lot of the iphone 13, that they've been able to maintain higher asps, supply chain problems are manageable i think with their power they

probably can manage better than some of the other competitors. and if the market is comfortable with what they say and what they talk about for the next quarter or two, i think that the stock can go higher because, as i said, it's been one of the weaker faangs nothing like what microsoft and google have done so far this year. >> apple has been a big part of the story for so many other tech companies that reported this year, the changes in their privacy hurting companies like a facebook, like a google, like a snap is it helping apple? >> it's probably helping apple's advertising business but i don't think they're going to talk about that there thereby questions, i don't think they want to attract scrutiny this is something that will play out over years it's not as if apple really talks about how advertising is a big driving force. although in the service side of the business it is but they're not trying to make enemies on this call they're going to try to establish their credibility as

huge supply chain owners and controllers and able to push product out, again, at that 90 range -- $90 billion a quarter when you think about the cash flow in this year, they will have paid 14 billion of dividends, bought about $95 billion of stock and they're still going to have 100 billion of cash flow that's over $200 billion the entire u.s. airline industry doesn't have sales in the year of $200 billion. >> let's check on the supply chain issue and turn to amazon there are a lot of people wondering if they've been hit the same way but they control so much of the supply chain, have so much bulk i'm a frequent user and i haven't noticed shortages of anything i'm trying to buy on amazon or frankly much trouble getting any of it. >> i think there have been some shortages of product that people have found in different locations and they'll address that they'll have to talk about wages

and whether they're able to hire enough people in their distr distribution centers amazon has underperformed the market so any comfort that investors will feel with the kind of number they put up, this is against a tough comp during the lockdown, everybody was buying amazon constantly. so anything that's above, i would say the high teens in sales growth will be considered up plus and that could move the stock higher. >> you have to consider aws. let's talk about starbucks because there are going to be a lot of people wondering what that company can put up, given the higher costs that we've seen for just about everybody that they've had to deal with and workers not necessarily back in full force. i think i heard like 40% of white collar workers are back. how does that impact starbucks >> that's what we're going to be looking at starbucks has high wages relative to service industries in the fast food or restaurant business that's not as much of a problem it's whether they're getting

their workers in and people are coming to work you talked about urban locations. showing strong in store sales growth but they need that because there was none in cities for a year plus. that's going to be important i think they'll talk about even coffee and the pricing there and distribution ability so i think this is a critical quarter to listen to what they're saying about what growth they expect over the next six months as people start to come back to work and whether that's behind or ahead of schedule. >> which of the stocks would you buy ahead of earnings today? >> i think that if i were to put money on it, i would say amazon would be number one and then apple and then starbucks. >> karen, thank you, great to see you. >> great to see you, becky coming up on the other side of the break, the s.e.c. reportedly drawing the line on crypto etfs when it comes to

leverage as we head to the break, shares of e bay under pressure in the premarket. what's happening earnings beat estimates by a penny and revenue also beat but fourth quarter guidance came in weaker than expected, the stock down close to 6% now. we're right back after this. i promise - as an independent advisor - to put the financial well-being of you and your family first.

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said the s.e.c. indicated it wants to limit new bitcoin related products to unleveraged exposure the proposal, by valkary investments seeks to amplify returns of a portfolio of bitcoin futures contracts and options of using 1.25 times leverage the firm must now decide if if it's going to withdraw the application or force the regulator to make a ruling and bitcoin is giving back quite a bit of what it gave back yesterday this point above 61,000 andrew, you're going to talk to your black swan buddy -- >> yep we're going to talk to naseem who has strong views on this once you get into the leverage game -- >> right he really, he -- he -- does he manage money do you think he's that much

smarter than paul tutor jones and mark andresan? i'd be hesitant as an academic to be so dogmatic. >> the amazing thing to markets is there's two sides to it. >> he must be so smart up next, earnings on deck for caterpillar and merck. those are just moments away. we're coming right back. hey businesses! you all deserve something epic! so we're giving every business, our best deals on every iphone - including the iphone 13 pro with 5g. that's the one with the amazing camera? yep! every business deserves it... like one's that re-opened! hi, we have an appointment. and every new business that just opened! like aromatherapy rugs! i'll take one in blue please! it's not complicated. at&t is giving new and existing customers our best deals on every iphone, including up to $800 off the epic

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merck reporting quarterly results. let's get to meg tirrell with the details. thank you for doing this for us. >> any time, joe merck reported a beat on the on top and and bottom lines for the third quarter, adjusted eps $1.25, 20 cents ahead of analysts estimate ts revenue was $13.15 billion, topping $12.33 billion estimate. also raising the 2021 forecast, eps going 565 to 570 per share revenue protected at 47.4 to $47.9 billion. of course key trueda, the major cancer drug a driver, coming in

22% up topping analysts looking for $22.3 billion. guard sill also topping estimates at $2 billion. the company saying its full year guidance does not include any impact from the covid-19 drug. they're expecting an fda advisory committee panel on on november 30th. they're reiterating 10 million courses they plan to produce in 2021, now saying they expect to produce more than 20 million next year. we have the ceo rob davis joining us at the top of the 7:00 a.m. hour a lot to talk about there guys, big quarter for merck. back to you. >> i had a lot of thoughts with the story we did with the generic antidepress ant $4 a pill that may be a threat but it may be a cocktail, so i'm not sure it subplants the other ones but

maybe work in addition to. when you get a $4 pill effective, 16% hospitalized on the placebo, 11% on the -- it was a small trial. are those numbers as good as the regeneron or the merck offerings, do you think? >> yeah, so the trial is about 1,500 people split between the placebo and the treatment arms i think people are pretty impressed by the result. we had seen hints that it showed promise. they needed a large randomized study to back that up. there seemed to be questions about what the right dose is so i'll be curious to see how this is treated in terms of treatment guidelines if they're ready to recommend it for folks or if they feel it needs fine tuning there are other studies go on with this drug in the testing. but i'd be curious to know if

any of these other companies look at testing them in combination. >> i remember one pill that -- i want one pill that has everything but i'm so vaccinated at this point no way i'm getting it. when can i get my fourth why do three why do three if i can do four? i felt a little strange yesterday, i will say that it is one to three days. >> just yesterday? >> yeah. i had it on the day before and i felt fine that day, but yesterday i don't know, i just felt -- i don't know i felt a little cobwebby, a little chilly. >> after my second shot i felt like i had the flu for 24 hours, chills, the whole thing. but then i was fine. >> right you know what, if you don't feel anything it's like your immune system -- >> you wonder what's going on. >> i'm glad i felt something. >> it still works even if you don't feel anything. >> really? okay >> yes. >> but you figure if you're ramping up, working your white

blood cells are running around, let's go, let's go you figure that you should feel -- maybe feel a little something. meg, thank you we'll see you back at 7:10 for that exclusive interview with merck's ceo, robert davis. we have earnings from caterpillar. the company earning $2.66 a share, compared to the estimate of $2.20 a big beat there revenue came in at $12.4 billion, the street was looking for $12.7 billion, maybe they give a bad because of the bottom line numbers. the 266 reflected strong operational performance and lower than expected tax rate also said that operating profit ma margin came in at 13.4% and higher sales across three segments and all regions that stock right now up by about 2% when we come back we'll continue to dig through the

earnings and don't miss our interview with the ceo of mattel that's coming up we'll talk toys and the supply chain ahead of that all important holiday season for the toy market find out if your toys will make it with santa's sleigh you can watch or listen to us live any time on the cnbc app.

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michael myers has haunted this town for forty years. if you track michael's victims, it's a straight line home. he's coming for me. we're coming for him. dan loebs is taking a large stake in royal dutch shell, encouraging them to split into two companies. "the wall street journal" reports the third point stake is worth well over $500 million, making the hedge fund one of the largest investors but i think it's a $180 billion company. the activist wants the company to split off legacy businesses, including refining from the renewable energy business which requires substantial investments. it would clarify the company's strategy and appeal to investors

making competing demands of the energy giant shell said it welcomes dialogue with all shareholders, including third point. joining us now to talk more jonathan bailey and francisco blanch francisco, start with you. a couple of articles that caught my attention today one was about china -- in the journal, china's need for coal clashes with global climate goals and point out china is going to talk nice about emissions but they're not going to do anything at all with coal until 2030 because they can't. their economy is growing so quickly right now that the economic realities make it impossible for them to cut any emissions for the next nine years. and then the other thing i read, and it's just talking about the third point deal, the activist wants this company to reduce fossil fuel investments, to

reduce fossil fuel investments aren't we just going to run headlong into some type of problem here at some point during a cold winter or gas lines, something if we don't continue to supply economies that need hydro carbon. >> joe, i think we already have. not in the u.s., of course, but certainly in europe and in asia. particularly in europe the big discussion is about what factories are going to shutdown and for how long because there's not enough gas in the winter to get through the next three, four months if we have a cold winter as you pointed out we've seen european gas prices going to $240 a barrel, 40 bucks mmetu compared to the $6 you see in the u.s. right now. so the problems are here, may not be felt in the u.s. because of the large presence of the shale industry on oil and gas. but certainly it's happening

everywhere already so we have the problem >> jonathan you heads up the investing at new burger. people want this, are you agnostic to what may be happening. we might as well, newberger give them what they want. are you part of paving a path of to hell with good intentions do you care >> we're sympathetic to the companies that might have challenges in the ability to access gas and oil, that's a problem. but we've seen a 5% increase in demand above precovid levels because of the economic growth, that's a good thing. and we haven't been able to get the transition back to the economic growth aligned with some of the supply pieces, right. so part of the problem that francisco talks about with gas supply in europe is down to russia deciding to use leverage

here around nordstream ii for the west to be able to access gas supplies so there are things nothing to do with esg. in fact, an example of poor governance that we think is a challenge. and this is part of the transition we're seeing. if we had better battery storage solutions, stronger ultrahigh voltage lines in place to help us to be able to deal with the storage problem of the climate transition and we will have that in the decade to come. the issues would not be ma manifesting itself in the consumer experience. >> what are you talking about in terms of jonathan, of a realistic sort of draw down of dependency on hydrocarbons do you think it's 2030

2040 2050 you know, it's going to be tough to have fed ex flying planes with, i don't know the world's economy runs on these things and we're used to it and take it for granted when do you see us being able to transition away from it, completely >> the 2050 goals you have the upses and so on in the world committed by 2050. we and they know the technology isn't there to decarbonize the air transportation but that's about 3% of global emissions. there's a huge amount that can be done right now around power generation that can be done around ground transportation and we're seeing that transition happen look at what ford, you have great numbers yesterday announced around their commitments to capital expenditure in their shift towardselectric vehicles that's why around 2030 we expect

most of the automanufacturers to be focused on electric vehicle production this is going to happen faster than you might think -- >> you have to power the grid, jonathan. >> i think that's right. in emerging markets, you know, like china, that transition from production perspective is going to be slower but the key thing is to stop building new coal fire generated capacity today and to look at the new renewables that have proven their merits. >> francisco, how would you power the grid what is our best chance for powering the grid with something other than hydrocarbon >> i think renewables are in most cases going to be the answer the challenge, as jonathan said, is that we don't really have enough storage -- battery storage technology to make the transition happen. remember, renewables start

intermittent jonathan mentioned something i disagree with, i don't think the european energy crisis is related to russia all that much. we've seen a domestic decline in europe around 20% because of the decline in investment. we've seen a 17% drop in liquid natural gas imports because china is booming and so, at the end of the day if we print a lot of money and give it to the people, people buy tvs and cars and things we have to make those things and that takes a lot of power it's difficult to make the energy transition if we want to go from a 40-inch screen tv to a 60-inch screen tv and all that stuff. i think at the end of the day, the energy transition requires conservation, and i think, you know, when -- your question on the power front, i think you really need to develop technology that you don't have today. there's things you can do, you

can go from coal to gas -- >> gas is a hydrocarbon. >> for sure but lower emitting hydrocarbon. so you cut emissions by two-thirds so you have that. >> if we're going to try to be be good actors in this country, do we have a chance of being held hostage to countries around the world producing stuff because we stop it here because we're trying to have these noble aspirations to get to not developing hydro carbons we were energy independent now we're headed back to where opec can hold ushostage, china and india have plenty of power, we may not based on us unilaterally trying to get to net zero too quick. >> look, i think there's an opportunity to use the border and you're seeing this being proposed for imbedded carbon on goods to make sure the u.s.

consumer is protected from essentially high carbon mechanisms in other markets and that would protect u.s. producers. >> sounds like gobblety gook using my boeing 747 to fly down to l.a i don't know anyway, gentlemen, thank you jonathan -- he doesn't have a 747. that's an exaggeration but i bet he has a nice 650 or 750, global express. gentlemen, thanks. we'll talk to you later. join us today for cnbc's esg impact summit. register now at cnbcevents.com up next the future of sleep, it's in a ring you guys know i wear it. so we're going to talk about it because there's a new one coming out. it's oura's third generation sleep tracking wearable.

the ceo is going to talk to us after the break to talk about how we can get some more z's as we head to a break check out shares of twilio plunging after they bet estimated of a 14 cent loss but a loss that's worse than expected. also announcing the deeparture o their chief operating officer. we're back after this. strengthening client confidence in you. before investing consider the fund's investment objectives, risks, charges and expenses. go to flexshares.com for a prospectus containing this information. read it carefully.

wearable tech company aura out with a new gem 3 ring, latest available for order shipping in november able to accurately read heart

rate and temperature and say they can predict when you are about to get sick. here now is ceo of the company great to sear you. if i get stopped on the street to talk about anything more than anything else it's actually the ring that i wear, your ring, and wear it enough that people ask about it it's changed the way i sleep i'm not an endorser i just say it so it's nice to see you on the show i want to talk about sleep and what's going on here people like jeff bezos these days, who says he gets eight hours of sleep and then people like elon musk who says he gets about five or six. my rating, 79. 5 hours 57 minutes of sleep last night. >> okay. >> but my question to you is, this new ring that you've got is tracking so many more things, and. >> yes.

>> the long-term question using here to kind of wearables how much do you think it will change behavior, but also whether you think there's opportunities for business leaders, a lot of investors are looking at how people are behaving throughout the ay, whether we're all goin to be tracked and whether that's okay. >> i think ultimately people want to do better than what they do sleep better, better on the show, even though it's 4:00 a.m. in california. i think for us as a company we've gotten into giving people actionable information that helps them change behavior sleep patterns, more on activity you mentioned illness. new features of women's health, the last people to do that on the corporate side, i think frankly we've seen that sort of change i think mentality is, like, we need to empower our employees more right? give them more benefits.

need to have them be at their top potential. right? and i think we've seen frameworks, actually done some with the nba and the nbpa helping to share in a protective way. anonymous. grag g al gra get and without seeing the actual person's data those frameworks will be helpful in the future. everyone wants to be healthier feel better, perform better. >> how much of this turns into a competition over time among people and obviously you have people like jack dorsey and others wearing the rings around now seeing competitions happening online between kim kardashian and gwyneth paltrow, sharing their information. who's got the most sleep, deepest sleep, lowest heart rate >> look i think people are competitive. right? competitive about stocks and portfolio or their fantasy football teams right? you get competition no matter

what we do write our messages really focused, and all of our daut taye, wait we calculate the scores is to the individual. it's back to your baseline and how you're doing we actually adapt to you i think we've written all of those messages for people not to be so competitive, but really take a look at themselves. so i think we've taken that balance much as we can frankly i think people are competitive about their health i'd rather they be competitive about their health than something else that might be bad for them. >> you used to work in the hedge fund industry. i know anallocator, i want to ask portfolio managers to wear rings so i can track them to figure out whether performance is related do you think performance is really related >> absolutely. look at research there's even studies going back to -- >> no, no. stop picking performance >> 100%.

>> actually perform better in the market >> yeah. you make better decisions. i think when you're well rested, your reaction time, your level of clarity of thinking right? you're not under stress so able to process information and frankly rest you're better to think through a little clearer yeah we've seen from the biggest hedge fund owners, actually recommending products for their teams just for that reason. >> got to go in 20 seconds, because it looks the same as the last one what does it do that's different? >> yeah. look, we have heart rate during the day. heart rate after your activity, new for us added a sensor and proud added seven temperature sensors. had three before that allows us now to get into women's health so predicting when your period starts for women automatically and actually doing a lot more in that category, and investing as well a lot around the corner. >> i will say, shows me a lot more information than i even

knew before. so good to see you i'll give awe call if more people stop me on the street but it's nice to see you. we're going to be right back with the ceo of merck. >> announcer: "squawk" ceo call is sponsored by -- i think you're going to like it here. umm, why is everyone... throwing things at me? look, as cfo it's my job to be ready for whatever's next. that's why i have my finance team, randomly hurl things at me. it's also why we use workday. it gives us insights, so we quickly pivot our strategy, people, planning, you name it. sorry, sir.

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amazon, could provide fresh fuel for the rally. we'll get you up to speed on what you need to watch. democrats hunkering down try to get over the final hurdle on president biden's economic agenda as he heads to the hill to try to lock in key support. we'll hear from the problem solvers caucus co-chair on today's meeting. and apple's advertising power play hitting names like snap and twitter jon fortt breaks it down the new privacy rules are having on social media companies as the second hour of "squawk box" begins right now. good morning, and welcome back to "squawk box" right here live from the nasdaq market site in times square. i'm andrew ross sorkin along with becky quick and joe kernen. look at u.s. equity futures quick, a couple earns reports

including our parent companying comes out as we speak dow down, nasdaq up and s&p up joe you have the numbers. >> i do. comcast reporting its results this morning, and i can just tell you that right off the top, the company is kind of saying things are pretty good strong quarter across the entire company, beating metrics, analysts metrics almost across the board. when you look at comcast, obviously it is a, there's so many different facets of the business, and ebitda, or adjusted ebitda is usually a pretty good metric to use. that was up 18%, and adjusted earnings per share growth was up 34%, and as a result, the number that we compared to analysts estimates was quite a bit higher than expectations. i saw it a little earlier. you guys are looking at this as

well what was it? 80 -- 80 cents versus -- >> 87 cents versus 75 the estimate. >> and then, you know, the pandemic and the emergence from the pandemic, comcast is an interesting one to look at because of that, because of the theme parks. had almost record operations, even though people aren't coming from europe yet, really, and that was mostly orlando. studio saw revenue increase of almost 27% to 2.4 billion dollars. that was by "fast & furious 9" and "boss baby" family business. >> that i know our household. "boss baby" is big in our house. >> the company, when people look for a fly in the ointment they always look at video losses, which -- and the company always

points out we've said again and again, we do not chase, or comcast is not chasing discounted video customers, and they continue to have net additions in broadband plus 300,000. >> yep. >> 1.1 million broadband subs, and i don't know is that still a concern, if you're losing -- you are losing cable tv video customers. >> uh-huh. >> not a half million but close to that every -- if that would be almost 2 million a quarter. you can see the cord cutting is something to be concerned with. >> sure. >> but the company would say, you know, you do streaming you know added some of the assets on skies, which the company says continues to perform well. maintains momentum in the uk, healthy ebitda, revenue, low turn and everything else the cable, nbc universal, the cable operations, continue to do well you know -- >> that's the -- theme parks.

>> a record. did you see "squawk box" mentioned in the actual release? >> i did not a pretty big company can't say that's a huge surprise. >> i'm surprised it's not its own line item. probably should be. >> are you sure -- >> so nbc universal revenue up 57.9%. just nbc universal revenue that's $10 billion olympics, things like that, obviously. >> broadband customers additions you mentioned is a key point, because that's what hit the stock a month or so ago, when there were questions from the cfo about, he made comments as a conference just saying maybe you're not going to continue to see the same sort of growth in the past, because during the pandemic people were signing up for broadband hand over fist, but total broadband customers, you mentioned up 300,000, for the full year 1.1 million year to date. just year to date to this point. >> a $ 61 or $62 stock.

there are positive things in this release that -- i don't know to an objective observer, like me, do not seem to warrant a $53 price on the stock, but -- >> up 1% based on what we've seen today. >> but that's just -- go ahead, andrew. >> no. i was just going to say. interesting about the studio revenue, up 26%, 27%. >> see told you now it's up $1.11. any objective person -- >> you know, there were higher expenses right now, and i know people are going to look at that in terms of operating expenses on the studio side but the drtruth is you have to sort of look through those numbers i think. a period of time they weren't spending money to make films and tv showsthat money is being spent now and i think you're going to see that -- you will see 9 results of that i imagine over the next six months and into the next quarter and the quarter after. i'm sure people will look at

that and raise a question, but i don't think it's -- yep. there you go. >> we're still talking money. >> i should shut up. or maybe keep talking. >> no. keep talking with me checking observer. still saving some money. you getting any good at doing your own makeup yet, sorkin? >> you tell me you tell me. how does it look >> it looks good. >> guys, just say real quickly. >> go ahead, becky. >> just on peacock, digging through from a immediatey pe spentive, advertising up 77% reflecting tokyo olympics, higher pricing and additional peacock sales partially offset by other sporting events timing and decline in ratings more on peacock again. increases at peacock again partially offset by decline in subscribers at our network people digging through to look on some of these peacock results as well, given the importance of streaming right now. >> we're going to go to dom.

i know, beck, in a second, but andrew what do you average per night in terms of -- i mean, is six what you're averaging? i think that's problematic for me and for the show and for everything -- because -- are you averaging only six, honestly >> well, no. i'm doing -- these days -- you know, i have three children. so you've got to give me a little bit of slack there. >> you need to think about yourself >> makeups time on the weekends i can get close to seven, it looks like you can see. it's a lot of ups and downs. >> because i've started getting up earlier 3:30, and so that makes -- i'd have to go to bed at 7:30 to get 8 so i never get 8 anymore seven i'm okay elong, five or six >> elon five other six bezos says eight up know who's winning in the money category. >> he may par for some sleep anyway -- okay.

>> got to move on, got to move on. >> we do over to dom chu and find out what else is going on this morning. what do you have >> earnings alerts bottom of your screen. three of the ones we're watching closely this morning first one from last night. ebay the reason why is because shares down 5.5% right now. ebay came out with results that beat expectations profits and revenues current quarter revenue forecast fell shy of some analysts estimates, and it's important because current quarter represents all-important holiday shopping season. if they're forecasting sales not within those expectations what does it say about the shopping trends we'll see consumer behavior going into the holidays that sort of thing. ebay share as key focus for a lot of investors bellwether sdindustrial-wise. cater

caterpillar. mixed picture. profits better than expected revenue, saw a lot of results positive across major operating units. more machinery demand and, of course, because minerals and teerms and commodity prices are so much higher encouraging people to go out and mine more caterpillar helped log an that and still down roughly 20% from highs seen recently over the course of last year. then, two stocks everyone's watching today into the morning. i should mention apple and amazon both up a half to three quarters percent now in the pre-market trade both of these companies out with earnings result after closing bell today and both underperformed apple up 13% amazon only up about 5% on a year-to-date basis they track closely still, apple and amazon, becky, certainly key focal points for traders to watch in trading today. see it that legs into something that maybe can imply something for the opening bell tomorrow for these two stocks back to you guys. >> thanks dom. merck reporting results moments ago too. meg tirrell joins us right now

with a special guest hi, meg. >> reporter: hey, becky. special guest, robert davis, ceo of merck thanks for being with us, rob. big quarter for merck. start with what drove the quarter. you guys seemed looking at recovery from a lot of the covid impacts. seeing it in massive keytruda number, gardasil numbers, your mmr, chicken pox vaccine doing well because of return of wellness visits. what are you seeing in terms of covid impact and what you're modeling going forward >> first of all, meg, thank you for having me on again i really appreciate the time this morning as you said, we did have an incredibly strong quarter and it's coming across all pillars of our business. you mentioned some of those within our oncology business led by keytruda, grew 22% in the quarter. vaccines led by gardasil grew 68% in the quarter and then obviously animal health business, strong growth at 16% we are seeing impact of the

pandemic largely receding, and really have strong underlying demand and good momentum in the business right now that i feel really good about. >> so you didn't include mulnupur but striking deal with governments. how do you look at the impact of that drug and dynamics of covid right now. numbers are high but coming down ho are you looking at that for the rest of the year and into early next year? >> yeah. you know, obviously, as you mentioned, while it does seem some numbers around covid-19 are improving, it still is having a grievous impact globally we really do believe that this new anti-viral drug will make a meaningful difference and as we look at the opportunity for it, truly it is about a drug you can take, a pill, anti-viral pill, you can take at home still has, i think, a meaningful

tu opportunity as another tool to make a difference. right now working with currently the fda to get approval as quickly as possible. an advisory committee coming up end of november and hopefully be in position before end of year to ship product both in the united states and around the world, and as you know, i'm proud of the access strategy we put in place around this drug to make sure we can accelerate delivery of this drug to everyone in the world that needs it as we look at it, i think this is a real opportunity first for the patients that need it, but it will be an important opportunity for merck as well, and right now we're on pace to have 10 million doses, or 10 million courses ready before end of this year and more than double that next year. so as we think about the opportunity this could be, obviously, we need to get approved, see the label and you mentioned we're working with governments and well positioned to get this thing moving very quickly once approved. >> hmm that global agreement that you

struck to be able to provide this then access to making this to low and middle income countries getting a lot of accolades from people who usually don't praise pharmaceutical deals nap is really notable back to something you mentioned about the label with the fda potential for the drug early days obviously haven't seen how they're thinking about it, but some suggested could be strict marketing requirements and sort of restrictions around the use of the drug, because of its potential muto genic effect. you are giving a short course of treatment and examined it closely. what's your expectation for the breadth of the potential label here >> sure. you know, obviously, it will be up to the fda to ultimately determine what the label for mono purafil will be when we studied in in adults mild to moderate tested positive for covid-19 who had risks that would show progression likely to hospital or death that was the

patient population we studied this in and that will soon be what the fda will think about as they look at the label, as you mentioned about the muto genicity it's important to understand we did a lot of study of this both in vitro and invevo and used really what are established tests to determine whether or not this drug is safe and whether or not we see any indication that it is muto genic. i can tell you through the data seen and studies done, we think it's a safe drug we don't see the muto genic risk and obviously will continue to study it but we feel very confident when we are able to fully display and discuss our data others will come to the same agreement, which is the benefit is real, meaningful and we believe it's safe. >> thinking about other parts of the business keytruda still just a massive driver of your results 4.5 billion dollars in the quarter. of course, analysts have been focusing on how dependent merck

is on this major drug. and seem to expect you could be in the market for more m & a how are you looking at potential further deals in biotech and what's available out there now and the valuations >> yeah. well, you know, as we look at the situation right now, i feel very good about what we see in our internal pipeline and you saw in this quarter eastern multiple additional indications for keytruda in combination with other therapies, several meaningful advancements and also important results. we gave out our hiv drug and we have a growing internal pipeline we're excited about. recently i had the good fortune to discuss with you not very long ago the opportunity to augment that pipeline through the acquisition of skellerron, a growing area of science and

really exciting pipeline in the cardiovascular disease area as well we're going to continue to build and broaden, and as you mention, also continue to look for business development you know, the deal we did with excelerron was an important step, not the only step and we are out looking, and science will drive us where to go, but i'm confident there are meaningful opportunities to augment our own capabilities, our own scientific opportunities and move forward in so you will see us continue to look actively for deals externally as well as moving our own pipeline forward. >> robert, looking at the stock. surprised. i think it's an all-time high, and still a pretty good yielder. 3% or so for a long time i think people thought of merck as kind of a, a bond with some up side, but maybe it's changing at this point. one thing that concerns me is the target that's still on the

back of big pharma i don't really -- know what to ascribe it to -- but when, you know, looking for money, it's like, oh let's look at pharma and drug prices things like that is that going to be -- a significant head wind forever, or do you think that it goes back to a more normal place? i'm talking about the view of big pharma especially after basically saving the world with the vaccines >> yeah. well, sure, first of all to your first point. you know, we do have growing momentum in the business i don't think we're done i think actually we have a lot of opportunity we're excited about our pipeline, excited about our ability to grow over the next several years. we frankly continue to believe our growth through 2024 is underappreciated i think there's more opportunity for this stock, but if you talk about the industry more broadly, obviously, the pressure and discussion out there around the

affordability of medicine is important, it's real as an industry we support that we need to do something about that, but it's really about addressing the issue, which is lowering the out of pocket costs for the patients, and doing it in a way that allows us to have a sustainable industry, one that brings access and affordability, but preserves and protects innovation as you mentioned, this is an at-risk business, a high-risk business but we've seen through covid-19 with the anti-virals, with the vaccines, we need this industry, and i believe over time you'll see it balance itself out as i believe we'll eventually reach compromise with the government. >> rob davis, thank you so much for being with us this morning look forward to talking with you again soon. >> great thank you very much for having me. meg, thank you for bringing us that interview. when we come back other side of this break, what apple's new privacy push means for digital ads and social media companies

that's the topic of this week the "on the other hand" with jon fortt. a quick check on markets right now. we are in the green across the board. dow about 104 points s&p 500 up about 16. nasdaq looking to open about 92 points higher. "squawk" returns after this. >> announcer: this cnbc program is spoensored by -- tv: mount everest, the tallest mountain on the face of the earth. keep dreaming. [coins clinking in jar] ♪ you can get it if you really want it, by jimmy cliff ♪ ♪

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>> announcer: now the answer to today's aflac trivia question. who is the largest lithium battery supplier in the world? the answer -- contemporary amperex technology also known at catl is one of tesla's main battery suppliers. well, now we've gotten earnings from snap, facebook and others and it's clear that apple's new restrictions on data collection are having a sweeping effect on the digital advertising market do the numbers prove apple has too much power in digital ads? does this sound like a jon fortt

intro? if it does, it's because it is, and otoh, on the other hand. right, jon >> snapchat down 20% after earnings afterthe ceo told us earlier in the year he didn't expect much impact facebook hit, too. anti-targeting moves continuing to cause headwinds apple says it's not a monopoly and minor unit share in smartphones but this is a glimpse of the company's actual po power. it's a problem its own advertising business is benefiting from changes. right. according to data from payments company branch, apple's ad share could be up 3x over the last six months because ad makers are relying on apple search ads to drive installs i guess we can debate whether tracking online had gone too far, but apple changing rules and immediately collecting a windfall is a hard-core move probably too much power for one company to wield, joe.

>> we talked about this a lot, jon. it was snap, but it didn't happen with some of the other -- google, twitter. not nearly as much effect. why not? >> well -- >> joe, on the other hand, google is pretty big in digital advertising. isn't it apple crushing the whole market you'd expect going toll feel it. let's see. alphabet earnings tuesday stocks up 5% yesterday. twitter's results didn't suffer from the apple situation because it's doing 85% brand advertising, not direct response adobe another big name in ditch it advertising apple strong arming you expect adobe to complain. their ceo said tuesday privacy is important and apple changes are focusing their partners having a direct relationship with the customer. which is healthy deal were they question whether apple is making money off its data restrictions. not really turns out if apps can't snoop on your iphone activity to influence your behavior they have to buy search ads instead good it's a good sign

these results aren't showing apple has too much power it's showing companies like snap and facebook that built businesses based on tracking or direct response can rewire the process to be less intrusive and brands can build direct relationships with us without spying on us if they put in the work, jon. >> so what happens next? with this, all the chaos, upheaval in the digital advertising business >> joe, interesting opportunity for some companies like adobe, like shopify, like so many of these companies that are trying to arm direct to consumer companies and others to have a more one-on-one relationship with the customer to do that also perhaps a return to, i don't know, target things to people based on their search activity or based on the content they're looking at, not based on following them around without them knowing to figure out who they are. >> can you take requests can you do these things that twitter puts on my feed that i didn't ask for, or are a good or bad thing?

can you do that? let me ask you would you like to know out of a set of 19 twins where one of these twins became famous but the other didn't would you like to know any of those, or about those people should i scroll through that does that -- why is that here? >> i don't know. i do take requests from you, joe. so, yes. we will -- >> becky, did you see that one today? >> i saw it a while ago. >> and you scrolled through? >> i -- what can i say clickbait. >> oh, my god! i got mad and i say i'm not interested and they don't care >> no, they don't. >> becky clicked on it you know then -- >> becky clicked on it. >> i'm part of your problem. by me clicking on it, it encouraging them. >> so funny. >> only encourages them. >> i do feel bad for -- do you want paid? chasing this is like chasing your tail. not worth it maybe the other twin is the one actually doing better, jon right? >> look where it got you, though, joe. you're on "squawk box." >> here we are talking about it.

got to go. thanks, jon. >> okay. thanks to both sides of the hand. when we come back, talking to us about taxes and president biden's spending bill. maybe a little bit about president biden going to meet with them this morning before he heads off to europe. plus, crypto taking a slight hit this week. interest in new bioiettcn f slows. talk to the kceo of crypto.com for his take on all of those moves. stay tuned you're watching "squawk box" on cnbc.

welcome back to "squawk box" this morning president biden's plan to visit capitol hill this morning to build support for his economic agenda before leaving for the g20. we have more good morning. >> reporter: good morning, andrew nbc news has confirmed president biden will announce a new framework for the social spending package as democrats search for direction over what should be in it and how to pay for it several key issues were skill in flux as of last night including paid family and medical leave. it had already been slashed from 12 weeks to 4 weeks and eve than in jeopardy amid opposition from senator joe manchin. tax provisions proving problematic too. manchin and many democrats in the house skeptical of the new billionaire's income tax one lawmaker is fine with taxing the rich but doesn't want to soak them. instead the house is pushing a 3% surtax on million nears, income above $10 million and

expected to raise about $130 billion over the course of a decade then the new irs reporting requirements for personal bank accounts 21 moderates in the house announced last night they oppose thid idea and want a more target aid proech this has been a priority for the treasury department, and senators mark warner, tom copper and angus king adamant it should stay in the final package, and i was told democrats were trying to rework the language to focus on those making more than $400,000 a year. so if the party can rally around the president's new plan, that could pave the way for a vote on the infrastructure bill. remember that one? potentially as soon as today, but, guys, of course, there is still a lot to be decided. back over to you. >> thank you. for more on the latest on the president's spending bill we bring in the congressman and we've talked for him for months about this and other things. congressman, welcome good to see you today.

>> hi, becky how are you? g. we keep setting this up and hearing this is going to be a framework that the president thinks democrats is rally around it has to happen today before he leaves for scotland for this trip but the more i hear about the details, the less likely i think that anybody even knows exactly what this framework is let alone can agree to it. what do you know >> well, there, because things are still being hammered out last night, still a few things have to get across the finish line we have a framework and i think the president will be up here, as you know, in the next hour and a half to lay it out and move forward hoping on the bipartisan infrastructure bill we've talked about a long time. came out of the senate in august 59 votes everything from water infrastructure, roads, bridges, tunnels including the gateway tunnel between new jersey and new york, and broadband, historic once in a century package and everyone is eager to get that across the finish line

as we've been trying now for months to do, and that will come along with this other social infrastructure package as well. >> i don't think everyone is eager to get the bipartisan infrastructure bill passed that's the problem a group of progressives in the house said, forget it. not voting on any of this until you agree on the second package. the complication continuing to say that today is the president going to thing that their minds with this visit? >> i'm hoping that's why the president is coming here nothing like the power of the president coming here and the speaker and others rallying support, but we've got to whip the votes, get it across the finish line. becky, back home it's, all people talk to me about getting this infrastructure package, roads, bridges, rails done, and of course making sure the other package is reasonable and targeted, gets across the finish line as well that's including state and level tax reduction and s.a.l.t., talking about that also for months and great for country and the big reminder as we face huge

deadlines including october 31st, the surface transportation, all of the investment in roads and bridges around the country, that expires. that's another big deadline we're facing if we don't get this package passed. there's a lot going on now, and a reason the president's is coming to the hill. >> congressman -- >> hi, joe. >> -- like you, again, hope springs eternal. you know that i've always liked you, and i hope for great things from you, and there's been many times where you, you know what new jersey residents pay, if you are one of those horrible people that make over $400,000 a year you know how it is the margin's rate and nothing you can do about it up over 55%, something like that, and you said that's enough probably shouldn't be anymore taxes. it's like -- talking about it earlier. democrats decided we're going to spend all of this money, and figure out how to pay for it with taxes then gone on this weird, let's

do this now, we can't get that let's do -- okay, no, we can't do that's let's do a carbon tax. no, he won't go for that let's dothis tax no do -- seems so half-assed the way it's going on and you've got, you've got liberal progressives that will say anything as a moderate, why don't you point out the enanety of this process process we're watching you're able to do that as a normal thinking individual haven't you looked askance at that. >> that's the nicest thing you've ever said about me, normal thinking individual >> aren't you horrified watching this andrew called it a clown car this is -- this is andrew! from "new york times" calling it a clown car. >> as you know, the process of getting here, making legislation like this is complicate d and it should be. what matter in the end what the legislation looks like we've worked for months, as you

know, to get the social infrastructure package, targeted common sense proposal, and i think as you know on the revenue side, it's changed quite a bit, because there's been pushback and listen, i've had concerned along the way where we are and as we keep focusing in i pushed hard to reinstate s.a.l.t. because we need tax relief for people in my district right? still got to make sure actually taxes go down, not up. but we also need those roads and bridges built because thing, crumbling. third worst roads in the country in jerds pip got to fix them if you have a competitive economy and want bipartisanship, that's very important we actually come together as country and show we can govern but it's complicated. >> now back to complaining the infrastructure bill with that, you know, with the metaphysical infrastructure. >> two different bills the whole point. >> congressman, there's no question we have to find a way

to pay for all of this the problem seems to be that within the democratic party there is no agreement on how to do that. so i want to go down two avenues with you one is, what's on the table now? hearing reports that there is the potential of these super brackets so the unrealized tax issue for billionaires may seem off the table. i wanted to find out if you think that's true. and, two, whether these super brackets at $10 million, 5% surcharge or additional tax and additional 3% tax over $25 million, whether you think that is on the table? let's dou that first? >> first an unsatisfactory answer because the president will outline this in an hour and a half a lot of things moving around including up to last night i was in a bunch of meetings yesterday and things were not final last night when i went to bed and the president's going to, leave it up to the president

to lay out what was reported and i'm hearing as the billionaires proposal is not on the table anymore. there's other proposals that are. but i think it's specifics of that, we'll wait to get them outlined, but it will be paid for. i mean, that was very important for all of us who are believers in fisk's responsibility, that it's paid for. all of these proep sproposals. in that other package, social infrastructure called build back better has in there resources not just for s.a.l.t. but for child care, for pre-k and of course to fight climate change things i believe are really important and have to get done as well. the question is, what do they look like in the end that's what the president's going to lay out today i would urge, and been urging my colleagues all along, we can't wait anymore on getting shovels in the ground and 2 million people a year to work on the physical infrastructure package the president way to jersey earlier this week to fight for, and i think holding that up anymore, i've said this here, make nos sense to me and we

should consider these packages separately, on their merits and the president's going to come and argue, of course, importance of doing both. >> we're out of time, quickly. rapid fire ideas are you okay with them you mentioned billionaire tax taken off by house and means committee. 3% to 5% surtax on anyone who makes over $10 million you okay with that >> again, i want to see specifics and totality of impact on my district becky, make sure i look at everything proposed what's the impact on my district in totality what i'm focused on. hard to do the one-off piece i got to see the whole package. >> i won't run through the rest of the list. that shows, though, this is not a deal we can say by end of the day everybody's going to agree with it's complicated got to see the whole picture, which it, and it's not easy. >> complicated but should are debated. the whole point. right? we shouldn't rush these things

>> congressman, thank you. >> thanks so much. when we come back, petpetpe pedal to the metal for ford. "squawk box" will be back after a quick break. uhhh... could we adjust our plan... ...yeah, like if we buy a new house? mmmm... and our son just started working. oh! do you offer a complimentary retirement plan for him? as in free? just like schwab. schwab! look forward to planning with schwab.

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welcome back to "squawk box. i'm phil lebeau with an update on the ford motor company. shares up 9% pre-market after the company reported much stronger than expected earnings for the third quarter. the company earning 51 cents a share, well above street estimate of 27 cents a share revenue a smidge under expectations but ebitda margin coming in at 8.4 percent guidance has investors excited stronger q4 sales, raising profit target for 2021 going from $9 billion to $10 billion up to $10.5 billion to $1.5 billion in terms of outlook for 2022, the ceo is not giving numbers at this point, that happens in february, he sees the chip supply improving, wholesale deliveries up 10% next year. strong ev demand and a growing order bank talking on a conference call

last night what he sees as the new ford. >> i think the culture is starting to change to be quicker, more accountability, less bureaucracy, and that mission permeates through the company. to me, the proof is in the pudding. like our third quarter. and -- whether we really change as a company will be proven out in our numbers over time like they have the last year. >> in the last year they've had a lot of milestones. by the way, they're not done they have a long ways to go. capital expenditures $40 billion to $45 billion through 2035. battery electric vehicle investment point out, becky, last time we saw ford shares up around the $17 range, early days of mark fields, final days of alan

mulaly. >> we spoke with mike jackson from autonation about a week ago. demand, he doesn't see that picture changing for a long time to come. selling cars and trucks that haven't even been made yet same with ford >> with ford and all the automakers they see strong demand lasting well into 2022 if not into 2023. >> thanks, phil. >> you bet. this morning, crypto.com rolling out a new ad campaign to introduce its platform to consumers around the globe we're going to hear from the co-founder and talk about the rece pcentri moves the bitcoin etf and so much more when "squawk" comes back in just a moment ♪ ♪

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welcome back to "squawk. the european central bank just out with its latest policy statement. the bank left unchanged also with assets purchases to continue until march 2022. christine lagarde will hold her usual post meeting news conference shortly of course, we'll be monitoring that meantime, crypto markets have been taking a slight hit after influence on new bitcoin etf has slowed down. launching globally joining us is kris marszalek, he's the

co-founder of crypto.com kris, good morning to you. nice to see you. we're trying to figure out where we are in this moment. we saw bitcoin go ahead of this run on futures of etf. now there's a question of new leveraged etf that they kept pushing backon robinhood news on the crypto platform and not producing the revenue that some people expected. is this a low in the moment? where are we >> first of all, thanks for having me, happy to be here. i couldn't disagree more strongly we just showed record numbers in the majority of etfs, the market remains really strong. on both sides and increased. we expect it with the business performance in q3, but we did not see that strong of a dropoff as you can see from robinhood,

so it's not proved that it pays with the crypto offering for the community. >> so, you think actually the robinhood issue is its own issue? >> well, i think that's -- they have a pretty limited offering with crypto, much to the level of interest with crypto. crip those entire ecosystem built out, we support blockchain and companies who specialize just can't keep up with the pace in the currency space. so, i recommend everyone to look for outcomes that are dedicated to crypto. >> right how do you think investors should think of these new etf products either investing in them directly or what you think the impact is ultimately going to be on the price of bitcoin or cryptoin this case, for example? >> well, it's a fantastic market

with the etf, not ideal product as far as the markets. so again, you're seeing these groups along a journey of broad options. they've got mass ive coming out every week but they are buying digital assets and treating the asset class as something that they want to get involved in. so i'm super bullish in the disruption and the leadup potential here >> the etb, which we just mentioned, it's related in some ways to bitcoin. in terms of just essential banks printing money in terms whereof you think bitcoin is headed as an actual leader investment or currency, you know, some people think we're $100,000 at the end of the year which would give us two months others think we're at $500,000

if you're cathy woods, but others thing we're half of it. >> i want to stay away from giving price predictions, but i think it's undeniable that bitcoin positioning as alternatives very, very strong and why we expect it there will be volatility, of course, it may go up, may go down, but we would be hard-pressed to find a better asset of the portfolio, regardless of whether income investment >> we talked about the ftc with the etf product that has leverage involved in do you think leverage is the issue in terms of whether this gets regulated and whether the ftc ultimately ale allows genuine etfs rather than future etfs >> it's less about leverage than

the inefficient way to build it. we all want to be a fully regulated industry and my point is accumulate while it's still reasonably priced. >> kris, nice to see yous, thank you. >> thank you >> beck. still to come senator pat toomey on the president's latest plan to get the spending plan passed he will join us after the break. later, don't miss our interview with the ceo of mattel, we're going to talk toys and supply chain stay tuned this is "squawk box" and cnbc.

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we'll be getting our first look at third quarter gdp. and breaking news from washington nbc news announced that president biden will announce a new social spending frame work this morning as he heads to meet world leaders overseas we'll bring you the latest details. and we're less than two months to christmas.

are the toymakers ready or getting the global supply chain. we'll consider ask the ceo of mattel as the final hour of "squawk box" begins right now. good morning, and welcome back to "squawk box" here at cnbc, live from the market site in times square, i'm here with becky quick and andrew ross sorkin the nasdaq managed to eke out a gains, all be earnings this week we haven't really talked about the fed a single time. >> it's been refreshing. >> which is nice just talking about actual results. and as a result, the ten-year has been pretty well behaved as things have been progressing. got up over 16 for a while, we

were 1666, the triple 6 number at one point recently but we're back to 1.55 on the ten-year just about nine minutes to go until the opening bell on wall street. dom chu is here. a lot of earnings. >> absolutely, an earnings barrage. that dominates right now, becky. let's start with the dow component merck, the drugmaker and dow component comes out with better than expected products and revenues, thank in part to its vaccine and cancer fruge industry groups there. merck shares up 2% but you can see they've been and underperformer on a year-to-year basis. and also parent companies cnbc and nbcuniversal comcast is moving up to the upside in a decent fashion up about 3% right now. still off 15% off the record

high leveling earlier this year. $61.80 is the record high for comcast shares still 15% down $54 a share. on the third hour of "squawk," we do a check of the most popular ticker searches on the website. cnbc.com over the last trading day, maybe no surprise here, ford tops the list on resumption of dividend payment, those shares up 8%. tesla up perennial, up 3.3%. digital world acquisition, maintains its position, up 10% right now. a very volatile stock up and down side, this is the stack and the energy, afternoon surging on earnings, robinhood markets up 0.2%. and highlights in the top 50 there as well, joe

>> all right thanks let's go to washington where nbc news confirms that president biden is going to roll out the details of a new social framework this morning and a report says it's expected to win the support of congressional democrats. that caucus is searching for a way to extend the president's plan joining us now senator pat toomey, the leader on the banking committee. senator, we know you want to talk about payment for order flow, we'll get to that in just a minute but first, front and center and what's going on with the bill the journal has an interesting piece in there, it's the journal, fly by night, taxation. >> right >> we all know that democrats like to tax but this time it's surreal. they started with increasing rates in the corporations in of affluent wait, that doesn't have the votes. how about a carbon tax no, no, that won't fly either. let's go after jeff bezos, everybody hates billionaires

that might be unconstitutional they go from one thing to the next >> that is true. >> without even thinking about policy implications or economic implications, and they've got to do it quick so president biden has something to take to the climate summit this is no way to decide on major policy initiatives >> no, frank list, itly, it shoe embarrassing to them looking for ways to grab money without any thought given to consequences of this, by the way, and to fund the welfare state into the medical class, people who generally don't need this huge expansion of government, it won't serve us well but republicans are left out of this conversation >> right >> this is a democrats only exercise we'll see whether the president actually has a deal. >> senator, we hear that those two horrible moderates, that they're holding up the entire senate but they forget that there's 50

republicans plus the two moderates. what i don't understand -- are there any other moderate voices in the democratic party at this point? instead of the vilified individuals. i thought about mark warner. >> yeah. >> is is he? then i tried to figure out other ones, durbin, ah senator coons, no. are there any others? where are they, they know better than this, don't they? >> joe, i have had the same thought many, many times i mean if it were ten years ago, none of these ideas would be getting any traction or at least very few of them would be getting traction with moderate democrats but now we hear this silence, but for two, who have registered, you know, their concerns and their complaints. i don't know, maybe the democratic party has just entirely made a huge move to the left >> senator, senate budget committee chair bernie sanders and i'm saying that without a hint of irony.

but when you say that in a sentence, then it sort of explains everything. hey, senator, let's talk about your payment it sounds like you like the wild, wild west. you got the gamestopper, the apes, the amc guys >> yeah. >> and the gamification. you said let it fly, baby. >> yeah. >> we want free commissions because it's dmauk tizing everything is that what you're saying with this >> first of all, what i'm saying i remember when i first got out of college, when i first worked in finance and when i finally had enough money to buy a few shares of stocks, i was appalled how much i had to pay in commissions. a very modest purchase, would easily cost me $100 or more. today, an american of modest means can buy stocks and pay no commission we've dmauk tized our markets enormously we've had a massive increase in the percentage of americans that

are investors, that is good for them and payment forward flow is one factor technology is a big part of it as well. but this is a mechanism that has helped consumers have no cost trading and it has helped innovators so, new platforms have been able to come in existence small companies have been able to develop some market share so, i'm asking the question of the s.e.c., what's wrong with this model tell me what's wrong tell me about a better model and i'm all ears and i hear crickets so i don't think we need to fix something that isn't broken. super execution, right, at better than change posted prices and not having to pay a commission for that -- i've yet to hear what's wrong with that >> hey, senator, i just wanted to pivot back to the conversation you were having with joe i appreciate the pity party you're having about the democratic party and what they're doing and this and that.

and i called what's happening here a clown show or a clown car. at the same time, we have to have a real conversation about spending if there's a bipartisan agreement to spend money, we have to come up with a bipartisan agreement to find revenue to pay for said spending and it feels like the republican party as well seems to go, ah, i'm happy to spend all of this money, but when i actually need to pay for it i can't find it. i can't do interest over here, capital gains here, estate taxes. none of it works, because when you actually get into the details, it's too much of a problem. what do we do? what do we do? >> well, i would say two things. i would reject the premise that we want to spend just like the democrats. as you've noticed there are no republicans who have embraced this mastiff multitrillion spending blowout that our democrats are insisting on doing on a strictly party line basis

so there is a big difference there. the second thing i would point out -- >> even as you put that aside there's been enormous amount of spending with covid and everything else. and something you thought was too much, some of that spending you thought was too much by your own party. >> yeah, i voted against it. i voted against the infrastructure bill although i can make a case for increasing infrastructure spending but i think they went way too far, spending in categories that we don't need and shouldn't do but i would also point out that, look, i think the 2018 tax reform was extremely constructive, accelerated growth we had record low unemployment, narrow egg of the income gap before covid hit, we were hitting on the eight cylinders, the economy was the best of my lifetime strong economic growth generates the revenue you that need to engage in. not this wild excessive spending that democrats are engaging in

we've got record revenue coming in, despite lower marginal rates. we've seen this before, the added growth more than offsets the lost revenue it's not a revenue problem it's a spending problem. that's what we need to focus on. >> all right, senator, do you -- something's going to happen, right? sometimes, both parties do it, the party wants to stay in power so we got to have some things in the win column and sometimes, they don't even know what's in the bill, but just to get a win. they're going to do 1.75, plus 2 -- they're going to do $2 trillion in our sleep? >> yeah, i don't know where it's going to end i think there's some chance it never gets done. most likely, the democrats do something. here, i think they've backed themselves into a really bad spot because there will be a huge disappointment in their base if they get nothing done. that's a political problem but when they actually get this done, when you look at some of

the things in the bill that the majority of americans are not going to support it. they've backed themselves into this position. they own it, i don't know how they resolve it. >> i can't believe there's no common border between virginia and pennsylvania i don't know whether you knew that i mean, what's going on -- i mean, if mcauliffe goes down in flames that looks to me like a dead even race right now i think that is an absolute. >> that's going to make it harder before they don't do something before that. >> that's the main thing >> go ahead. >> that's amazing for a state that joe biden carried by ten points >> okay, senator, see you later. thank you. >> thanks. >> i looked that up, just to be sure pretty close, though delaware - when we come back, we're going to talk about at the bottom of the hour, the first look at third quarter gdp.

plus, straight ahead we've got an interview with the ceo of mattel we'll talk about supply chain concerns this season around whether or not you'll actually be able to get the toys your kids want. a little later we're talking market growth and crypto with the author of "the black swan. as we head to break, let's take a look at shares of merck. dom mentioned shares were up merck's ceo robert davis joined us in the last hour. he talked about the covid-19 infections in adults he said even those case numbers are coming down he believes the drug can make a big difference in fighting the pandemic. >> so, i think this is areal opportunity first, for the patients that need it. but it will be an important opportunity for merck as well. ghnow, we're on pace to have 10 million dose, or 10 million courses ready before the end of this year. and more than double that next

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welcome back, everybody. the holiday shopping season is almost upon us it is probably going be the biggest test yet of america's strained supply chain with container goods backed up at ports several months ago still, toymakers eye like mattel says it should be able to meet the demands like barbies and hot

wheels cars. revenues that beat the street's expectations and raised its guidance are for the third time this year. for more on the holiday shopping season, we're joined by ynon kreiz. it's good to see you what have you guys done to prepare? >> well, becky, you have watched the recent journey and you're seeing now the strategy that's formulated into a driven high performance company. we have strong momentum in our business and almost doubled the growth rate of the industry this past quarter and as you said, we just raised our guidance for the third time this year. and we're on track to achieve our highest four-year growth rate in decades. you know, after growing and gaining market shares for five quarters in a row, we expect to continue driving growth in the fourth quarter increase market share and have a strong holiday season. >> you know, the stock market has rewards you, ynon, if you're

looking for the last year of stock up 46%, 26% year to date at this point. i think a lot of people have been waiting to see what was going to happen for the fourth quarter. you told the street very recently you think you can handle the demand. but why is that? what have you guys done to make sure you'll have toys that everybody wants for the holidays? >> well, our supply chain have been able to successfully navigate through disruption. it's not that we were not impacted but we did a really good job of finding ways to mitigate through some of the disruption withanticipated short supply and longer lead times. and the fact of influx planning was very specific until mitigating action. we expedited procurement of raw materials. we accelerated production of finished goods we booked and contracted the ocean freight capacity and generation event we secured access to additional ports and shipping lanes and, you know, this is really

where our scale, expertise and flex ability supply chain model come into play and showing to be a real advantage for mattel >> yeah, it's a huge win to be able to get toys to the shelves. but it doesn't come cheaply, all of those additional measures that you had to take in expediting things. plastics price, resins prices have gone up significantly, as wells other inputs, what does that mean in the way things are costing at this point and how much do you pass on to the consumer >> cost remains difficult going forward. we raised prices in the third quarter. and expect that with price action and cost savings are now shy, over time, we will be able to mitigation inflation impact >> meaning that the consumer is willing to do that at this point, they want toys and they prioritize spending on toys at this point >> yeah, we're seeing continuing

consumer demand for our product, we're weathering the fourth quarter with great momentum and off to a great start in terms of preparation for the holiday season our plans are strong retail programs are in place promotional plans are looking great. and we have an exciting range of new products that we believe consumers would love and enjoy >> you know, you talked a little bit about the transformation that was taking place at the company before we saw the pandemic and that's something that the street has been watching very closely. this idea that you're kind of tying things up with hollywood in some way with films and movies and making sure there's cross-promotion taking place and the toys that you're building play naturally into that then you have the pandemic where adults were way more willing to spend money on toys because they weren't spending money in other places their kids were stuck at home. they wanted to make sure they were entertained how do you take apart the two story lines to make sure the change that you're making with

the company is paying off above and beyond what we're seeingon the pandemic >> well, on the toy side and on the core business, we made tremendous progress. our ebitda, just before we started the transformation in 2017 was $126 million. and we just put a guidance out at $925 million of adjusted ebitda this year so in four years we length from 126 guided to be more than 900 million. that's significant progress. we made also significant progress on improving our balance sheet. leverage ratio is below 3. and we're making very consistent progress towards becoming invest-grade credit -- you know, reaching investment-grade credit metrics. so, we are on the toy side, on the core toy side, we are now performing really strongly on the second part of our strategy, to capture the full value of our intellectual

properties, we also made a lot of progress with the business in place. we have 30 movies in development right now. we just released eight television shows this year alone and more than 30 in development. in terms of opportunity to capture full opportunity from our catalog which is one of the strongest portfolio of children and family franchises in the world there's a lot of opportunity for to us grow our business in addition to everything that we do on the toy side of the company. so -- go ahead >> well, i mean, is that the future before this, for people who don't know, you ran a maker studios that was acquired by disney studios how important is that link between intellectual property making sure it's used as a marketing tool to get kids back interested in toys? how does that work >> it's really about finding ways to connect and engage with consumers. we do it at mattel really well

with a clear brand purpose and a mission that the company put out to create innovative products and experiences that inspire and retain and develop childrento play in addition to being culturally relevant, all of our toys have a strong connection to the audience, timely and timeless, at the same time we're very focused on design and proud of our innovation. and as a company, do a really good job in executing our plans. between supply chain, commercial capabilities and world class design and innovation. we're putting our product that brings together quality, safety and value for consumers. and seeing that in the numbers, in terms of growth, momentum and increased market share >> so barbie, specifically, i mean, barbie was a toy that i think lost some of its luster for a while. it's come back it's now the number one global toy brand. how much of that is because of the changes and diversity?

and the different dolls that you're kind of making that look very different than just the barbies the past >> yeah, barbie is just an incredible success story and a really good example of mattel. barbie is the most diverse doll in the market and continues to evolve, be more relevant, and really a modern reflection of the world for today's kids and families barbie is dedicated to helping created a better world for kids everywhere but focusing on diversity, equality and inclusion and also a lot of work with sustainability so what you're seeing is really strong connection with consumers, demand for the barbie product in all of its segments remains strong as we head into the fourth quarter and expect to see barbie growing also this holiday season >> yn,no thanks so much. good to see you. >> thank you so much coming up, breaking third quarter gdp data "squawk box" coming right back

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♪ welcome back 0 to "squawk box," rick santelli here with live breaking news top-tier economic releases we're looking for not only claims but look at first quarter gdp. initial jobless claims, another post-covid low, 280,000. and a week in arrears also a post-covid low, 2,243,000, in

terms of gdp, 2.6% is what people were looking for. not that many months ago we were looking for a number closer to 7% this is a disappointment, up 2%. only up 2% and of course, this is the advanced look. there will be two more looks to pencil the puzzle in with a more permanent mark. with consumption, it's robust. c conass consumption, following a 12% increase the next two, maybe the most important in my opinion, the price index goes back to 1947.last look at 6.1%, well, it was the highest in 40 years. it moderates, the 5.6%, still hotter than expects, finally, we

look at the core personal consumption expenditure, quarter over quarter, a fed favorite on inflation. it was 6.1%. last look, 4.5%, this time, 6.1 happened to be a 38-year high. so the moderation was exactly as expected as we look at all of this, brazil raised its rates 150 basis points, ecb, no, don't need to. bank of japan, we're good, thank you. we don't need to do anything german inflation 4.6%, year over year running hot, hot, hot and finally, every yield curve of all of the developed economies is flattening. meaning short rates are outperforming long rates they call it a bull flattening because in many instances rates are actually going down so price goes up. why do i point this out? because it's not a great dynamic. basically central banks dragging their feet in done where is they don't have in my opinion

inflation issues although they may have supplies. versus countries like brazil who understand inflation and trying to deal with it in a timely fashion. and, skrors, not to mention, every three minutes they come up with another plan in washington to try to tax us no forethought, no planning, just throw things up against the wall great op-ed on that in "the wall street journal," joe, you're on fire today >> you get enough 2% gdps with hot inflation numbers you once again start saying this isn't what financial analysts really love any hint of stagflation. but andrew has been right about -- well, a lot of things but let me ask you this, rick, i doan want you to channel the key party rick santelli as much as the pragmatic rick santelli on this let's say we do admit we want some of the regular infrastructure

i know we probably don't want some of it, but let's say we don't want to do deficit spending to fix our roads and bridges. what would you do, what is the most palatable ways to raise taxes? how would you do it? all of these things they keep jumping from one to another, it's ridiculous, like you say. but is thering in less damaging? >> i think a vax tax people are saying i don't believe people is saying this. i think we need to lower the amount of other taxes and tax things people buy. you want to buy a yacht and you're a billionaire, put an extra tax on it. that's what people are buying a consumption tax. i think that would be much more honest >> if they borough against their stocks and don't pay anything out but if you're buying a 500-foot yacht, big tax. >> yeah. i'm not against it

>> on luxury items >> you got to figure out a way to do it so it's not progressive. >> you got to make sure it's progressive, not regressive. especially if -- >> well, not being progressive >> but with inflation already there are people at the bottom >> i don't understand, you're all east coasters, what is the deal with salt i don't get it, i hear everybody screaming that the wealthy and affluent don't get taxed enough? what is s.a.l.t., we're not talking about people that are taxing on houses 100 grand we're talking about the big ones >> we're not seeing 100 grand houses out here, rick. >> explain that to me, i think it's a good idea let me go back to that tax you're one of the first people i ever remember talking about inflation and mocking the idea we would look at core numbers but don't include energy and food prices but that's insane, people get hit really hard with

inflation when it goes up. i can understand a vat tax on items that seem like luxury goods or wealth that people do pay for, but just to be cautious to make sure it's not something that's going to add on top of the inflation, that people are going to be with items they need at this point. >> if we want less inflation, first thing we need to look towards china and germany, with climate change, yet, they're burning a ton of coal, okay, because we're so short-sighted, we have this high morale ground that we don't want to pollute. i get it but if we're not ready for prime time and all of the alternatives, all that's going to do is make middle class, lower middle class and poor people around the globe suffer dramatically, trying to go from point "a" to point "b" to earn a living to try to put gas in their car. hey, we have rolling blackouts, rolling brownouts. this is america. our shelves are empty.

capitalism is good for one thing. keeping the shelves full >> back here to -- >> conflict -- call it a consumption tax. i like consumption tax better. anything that anybody buys that costs more than x amount of dollars -- >> that makes me think you're not concerned about inflation to middle class people. i get a v.a.t., a valid added tax. >> it's mostly because of energy and poor policies in washington along with capital of many economically developed countries. >> rick -- >> well, go ahead. andrew yes. >> no, no, i was going to say that's a nice segue, rick, to our conversation about oil and energy right now so, thank you for that because the energy piece is a huge part of this, and top oil executives are expected to face very tough questions today from

congress about climate change. and brian sullivan joins to us talk about that right now. brian. >> yeah, good morning, andrew, i'm not sure i can follow that rick talks about a consumption tax, guess what with gasoline prices and natural gas where it is a lot of us are going to paying, quote, higher taxes with gasoline and heating costs that aside you've got four ceos and trade groups u.s. chamber of commerce visiting virtually capitol hill today where they will be grilled primarily by democratic congressman ro khanna and it's now pushed back at 10:30, essentially to accommodate the president announcing his big spending bill there are going to be tough questions, andrew about the oil companies' roles in not only climate change but also producing misinformation about climate change all sparking from that leaked undercover video from greenpeace back in group, with lobbyists

admitting, yeah we use shadow groups, shadow interests to divert misinformation, whatever and man-made role, fossil industry role, in climate change expect a lot of difficult questions. expect a very long hearing expected to go six-plus hours as well guys, we're going to hear two things from the oil companies, chevron and exxon, carbon capture and net zero how they're working to change by capturing emissions. i think bp and shell represented by their u.s. ceos not the total company ceos are going to say we agree. bp is going to say we were the first to identify man's role in this back in 1987. and they are selling off assets, shell as well in the united states so i think the four oil ceos are going to go in different directions based on whether they're european or u.s. trade groups will take it on the head virtually as well you might expect a fiery

hearing, andrew, that's compared a little bit to the 1994 tobacco ceo hearings >> what i was going to ask you, brian, how much of this is going to turn into a hearing, ala, the tobacco hearings what did you know, and when did you know it or as you said there was a disinformation campaign going jon and how much of that is going to be like the conversation we've been having on the air and the last several weeks as steve schwartzman raised yesterday which is as there is less investment in fossil fuels that we are starting to struggle and starting to see the price of energy, at least short-term, go up, and what do we do about that >> i'll start with the second one first because i'm going the uk the week of november 8th and we're going to talk just about that as well because we are seeing the possibility of energy shortages but people that say, listen, we're going to have to have some pain in the transition it will not be smooth. >> right >> of course, that's tease say when you don't have heat in the

winter or you have to pay, what, $10 equivalent to gasoline or your heating bill triples. >> how much is that a conversation in congress as a preview for today do you think is about the second issue i just mentioned which you're starting to hit people in the pocketbook when they go to the gas station? and how much do you think is going to be on the information/disinformation piece of this? >> i talked to a congressional staffer last night here's the reality, andrew, you know this, we're seeing higher gasoline costs and heating costs. i think the industry wants to put this in front of america and say here are the representatives of the fossil fuel industry that are not investing their billions or trillions of qana is going to note trillions. i think there are two aspects your point is well taken, number

one, clooipg, their role, misinformation, disinformation also, let's parade these people out in front of the country, prior to winter, starting to get cold, your heating bills are going to go up you need people to say this is the reason these are the faces behind your higher gasoline prices because as you know, the political battlefield has been littered with remains of politicians who had to go up against higher heating costs you heard rick talking about inflation, guesswhat, we buy milk, we buy gasoline and we heat and cool our homes. pretty much that's all we've got in common from a spending perspective. high gas prices have crushed many a political ambition. >> brian sullivan, we'll be watching all day look forward to seeing what kind of drama comes up. thanks, becky. >> well, drama is what we have, stick around, you'll see what i mean in just a moment. up next, the author of "the black swan" to talk markets and

deficits as president biden is set to address the nation on his spending plan. don't go anywhere, i mean this, you're going to want to stick around to see the next shot. "squawk box" will be right back. what if you could have the perspective to see more? at morgan stanley, a global collective of thought leaders 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. today, we are translating decades of experience into strategies for the road ahead. we are morgan stanley.

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welcome back to "squawk box. this morning, presidentbiden set to announce the framework for his massive new spending bill today, raising the prospect of trillions of dollars of deficit spending joining us to talk about the potential for the black swan event.

adviser r nassim taleb also the author of "the black swan." becky said that we have to come back tos l s see this shot >> this is a look from a friend of mine, i think it's billions, competing with you guys. >> are you going to keep it on for the whole interview? >> no, no, it's pre-halloween. we got to talk about business now. >> it's great. happy halloween. but let's just talk about business let's particularly talk about the biden spending plan. i'd ask as somebody who thinks about the markets, at what point do you think is the spiraling deficits actually come back to haunt the markets? does that ever happen? we've been talking about that

forever. >> okay. we have -- i think bigger problems than the deficits we have a lower interest rate environment that caused all of these asset price inflations people talk about inflation, in fact, we have a shortage, of course, you keep talking about a supply chain and there is a shortage i've rarely seen shortages not followed by gluts. but you can see gluts followed by shortages so, the asset problem is big we have a no interest rate environment that has been swelling things. this is where you can see cryptocurrencies, you know, valuations between 2 trillion and 3 trillion, as we're speaking now and will change in ten minutes. that's what we talk about. rather, it's more important, the deficit, what will happen when they raise rates because unfortunately, this will happen. and what will happen to assets

>> and what do you think the answer is? >> well, the answer is, we've seen it since, you know, i mean, i've been in the market for a long time. as you can see from my gray hair, but following the closest scenario is the nasdaq bubble collapse and that was much more reason environment than one in which we live today we have 2 to 3 trillion as i said in crypto assets. when, of course, we had other similar environment like the 2008 crisis. and we had the intermediate such events, and the crisis of 1987, 1994, so, we can see every time they raise rates, something happens. >> nassim, if you're right, though, and we're seeing towering inflation and massive

spending, and allof this is going to happen, why have you been, dare i say, so bearish around the arguments around crypto, and in particular, bitcoin, which bitcoin proponents would say is the ultimate hedge and you all are in the hedge business? >> let me tell you, i'm in the hedge business and the hedge business particularly, the only thing i will tell you, crypto doesn't hedge anything, not inflation, not stock market nothing. it's like -- to me, it's like a grandiose scam i saw in the beginning that it was decentralized, in fact, it's not even decentralized and it's trying to replace 4,000 years of legal thinking in commercial transaction with automated entry that are not yet reversible crypto it makes -- nasdaq, as i said 2000, look very rational. >> so, you took to twitter and

you said, though, let me repeat it those unable to get it, i am not bearish on bitcoin what do you mean by that >> no, not yet you need interest rates to go up, then, of course, i would worry about all assets, not just bitcoin. and this is where you really need -- remember, our business, mark and myself, it was a preamble for what became universa and we realized then that tailorist hedges are very, very difficult to do, and they're necessary. and don't stay in the market that you hope you're going to be diversifying yourself of other assets, crypto or something else >> nassim, what is the right answer now then? for those listening to you, saying, what do i do about this?

>> well, the right answer is the first thing either cash f it happens eventually in the long run, but initially, initially cash rises in value when assets collapse after the rise of interest rates to fight inflation. this happened, cash can king, and then later on you buy the assets and it rises. so, for an investor, you can do -- cash is important, but if you still think there could be up side to stocks, then you must do proper hedging, and hedging is hard. >> you still think there's up sides to stocks. >> yes it depends on interest rates the problem is like there's no

valuation. it's liquidity when you give people free money, they start inventing uses for it, you see? when money ceases to be free, then we have a different environment. i appreciate that, but then you, as somebody in the investment business seems to make a bet, dare i say, about what jay powell and what he will do. >> i'm in the business of not making bets, finding and building robust portfolios i'm not in the business of making bets, and the portfolio resists all kinds of environment, in much a bull market continues, and of course an around where a bull market ceases tip keep a bull market ceases to lose its steam -- >> nassim, let's say you're big-time long equities, which i think a lot of our viewers are.

>> yes. >> you wanted to inexpensively try to hedge that risk. >> if done right, not only are expensive, but profitable in and of themselves. i think the return -- you can check the -- it's a positive return hedge that puts it on top of hedge fund returns. >> it's a longer conversation. it's always great to see you. >> thank you. >> thank you for gracing us can a bit hall on wean fun we look forward to seeing you soon. >> thanks very much. have a great day jim cramer joins us flow i don't think i can help myself, jim. i made the point earlier about comcast, and becky brought up

the idea that the cfo aluluded o it before, appeared it dropped from 61, 62 down all the way to 52 down a significant amount. did this earnings report dispel -- were the fears overblown? >> i think it's going to do two things one, for those that are rational, it tells you the fears are overblown. two, for those believe there is too much of an overslow youing, they will not be appeased. it is obviously i wok for comcast. it's painful that some companies are doing better than others and some companies are taking share, some are losing share, but there's a moment when everybody

thinking everything is bat you know what, i'm really warming up to comcast. >> you highlighted something. >> the 2% gdp, there are doing do way better and there are companies that aren't doing better. >> i wish i could find companies that aren't doing better than 2% gdp. i wish some of these enough were done by service now or salesforce or adobe. i know people trade on this stuff, but it's like the labor department, by hand tabulation, again, it should be done by computer if we're digitized, i think you would sigh the economy is doing much better. >> it doesn't feel like 2%,

unless you're talking about delta-plus, or whatever the next -- that's the only reason i could see -- there's things going on everywhere. they say airline tickets are so cheap. they're not cheap. >> i think we're going to find out in a couple years, as departments go to service now or salesforce or adobe, that these numbers are not tabulated correctly. i don't have any companies growing at that pace you can't argue the autos, because they can't get the dhips, that's reflected in there. autos will be down 30% year over year that must be it, joe i enjoyed that thing with

andrew i found it quit cal, because andrew was asking all the right questions. >> i might give i my moan before that guy. >> also, the thing with the jewelry and stuff. you excel a my onquestion. we have to go to get to you. ta quk x", jim. "sawbo will be right back. here's jim's investing club. here's jim's investing club. cluck on it, use your phone. ♪ ♪ ♪

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good thursday morning. welcome to "squawk on the street." i'm carl quintanilla, with jim cramer, david faber. more companies raising guidance. q3 gdp, consumer is light, but a new jobless lows the president said to make the sale to house democrats this hour and set to announce the framework of a spending bill later on this morning. >> plus look