plus crypto prices plunging as everybody is writing articles on gold and its comeback bitcoin tumbling below $60,000 it's november 16, 2021 and "squawk box" begins right now. good morning, everybody. welcome to "squawk box" here on cnbc i'm becky quick along with joe kernen andrew is off today. yesterday was a pretty nonexistent day for equities, at least if you were looking at the end of the session basically marching in place in the session, the dow down by 12 points nasdaq off by 7 points but the s&p was down by 0.05 points so basically standing in place for the day. this morning, it's more of the same nasdaq off by about 17 but the

s&p is only down by about 3, dow is up about half a point at this moment and we are awaiting all those earnings numbers that could move the needle one direction or another, as we get a look at the health of the con summer and the companies reporting today, walmart and home depot whether they were able to maintain the margins could they pass prices onto consumers, find other ways to do it, we'll find out. treasury yields, the ten year yielding 1.599% almost to 1.6% we'll see if it pushes beyond that or higher the price of cryptocurrency is plunging, no catalyst on this, maybe we can say the same thing days it's up bitcoin tumbling back near 60,000 right now you see it down at around those levels you have ether down as well. and some other major coins falling sharply. you can take a look across the board. bitcoin off by 5.5%, ether down

by 6.5%. litecoin off 10.5%, biggest decliner on that board we'll continue to keep an eye on this. >> i used to know all gold coins. i don't know anymore maple leafs i would say those coins are not falling today. the 52-week high and low on gold --i don't remember it was as low as 1672 and it's been to 1962, gold but -- >> it's still like break even for the year >> the last month it's up. and it's up about from about 1750 and it reminds me of the size of the move, it reminds me, okay, the ten year is back to 1.6 because of the inflation numbers last week. and we got an anticipatory move in gold. you are seeing some effect there. you can hear people thinking

transitory, janet yellen says it's transitory. is it? these small moves it's like people are maybe setting themselves up for what might be more than just a transitory move in inflation. >> larry summers had some really strong comments about this too yesterday he said, look, inflation is here, the fed needs to act immediately and stop the purchases. and if they don't, inflation very likely is going to set it up so that donald trump comes right back in. >> we'll see about powell too. yesterday there was some word that maybe some senators would be alerted pretty soon about what the decision was going to be that's going to be near term you know, he -- he gets pummelled by a lot of people that -- and he seems -- i don't know we'll see. a woman as fed chair >> brainard you mean

>> yeah. >> and not a republican. elizabeth warren, bernie sanders, i was reading a piece in the journal today about -- i love it -- the nominee for controller of the currency which we've talked about a lot but the individual went to moscow state university with leishman, i think they were -- steve did not go there. >> no. >> but she did go there. and i don't know if you saw the journal today. it's kind of interesting she -- in this case it had to do with restructuring companies that are in the wrong business and that the government really needs to be involved with what type of companies -- the journal points out, at least she's honest about what she would propose. but i don't know what do you think? what do you give it -- i would think powell was a shoo-in, 95%. i don't think it's 95%. >> it's not. >> it's about 60 >> yesterday you saw a move yesterday on -- >> predicted. >> on the things that were

predicted it it was up 8 cents for layelle brainard. >> i didn't look at that. >> yea we'll see, we've talked about this all along, how much of this is biden going to feel like he has to appease progressives on this how much is he going to feel like i haven't given you on other things, this is part of the horse trading that takes place in politics. politics takes a role. >> jay powell saying how much more could i have done for you >> yes and the treasury secretary janet yellen said he did a great job but over the weekend changed her tune. >> over the weekend -- he's done everything the biden administration wanted to do. but after all he's done, if they don't -- that's ingratitude. he's ruined his reputation, among right -- among conservatives. >> he did what needed to be done

during the pandemic, yes i think given his druthers maybe if he wasn't up for this position he would have moved more quickly. >> yes compromised his own -- >> i think that's what's playing on people -- >> compromised his own -- >> >> i'm all in favor of what he's done to this point to try to get another term. i listened to his press conferences and i feel pretty confident in what he's saying with these things. when he goes through, he understands the markets, how these things work out -- >> the republican, he's not welcome. >> but what steve has pointed out is that layelle brainard has voted with him on every move. earnings out from home depot. interested to see. up 5.5%. reported profit of 392 a share the estimate was 340 revenue 36.8 billion

estimate was 35 billion. comp store sales were also better than expected so not bad joining us with immediate reaction brian nagle, analyst at op jeimer. that's what everyone was talking about. the slowest growth was possibility. the slowest growth we've seen since, i don't know, it was a pandemic play but managed to do okay, at least better than the lowered expectations for same stores sales growth. >> i think the -- good morning, joe. this is another very, very strong report from home depot. when you consider the numbers they're putting up on top of difficult comparisons. like you said, the key figures here, comp store sales 6.1%, domestic comps 5.5 those were above expectations. but those come on top of really difficult comparisons. so what we're seeing here, in the press release from home depot is rather short this morning but what we're seeing

is, even as the pandemic in the united states is fading, thankfully, home depot has continued to perform very, very well on the heels of underlying strong demand for home improvement. this is a positive investor expectations i've been talking to our clients a lot into this report, investor expectations were high in this report i won't see much in a pop in shares today but this is a solid report from home depot. >> classic it's a big stay at home, people are going to improve their homes during the pandemic. now, rising home prices are giving people the confidence to reinvest in their homes. but it was put off some of that home improvement they were put on hold during the health crisis. this is a reopening and closing side but 6.1 is way above what's wrong with analysts they were at 1.4% why were they so negative on the

estimates for comp store sales considering it was up 6.1% >> i was right there i've been assuming, and assuming incorrectly, that comp store sales of home depot would weaken through now and then further so on the heels of these more difficult comparisons. the company is proving us wrong. putting out great comps on difficult comparisons. now i remain concerned if you look at the comparisons over the next few quarters they get more challenging, particularly into early "22, i think that could be a headwind for home depot here. particularly as we get further away from the pandemic so i think right now there is some pent up demand they're taking advantage of. people could not get jobs done in their homes because the workers were not there you couldn't get workers into your homes but nonetheless, this is a strong report from home depot. >> the earnings per share beat is a good indicator too.

it tells you they're not getting killed on the margins yet. but i have a question of how much of the same store sales is from inflation they said customer trangs transactions are down. i guess the question is are customers paying for more expensive things, trading up and buying pricier brands or paying up because inflation is there? the expectation sales from the national retail federation is 8% or something but we talked to the head of that and he said it's from inflation. >> that's a great point. those numbers you laid out, what that tells me is, it's really a combination of factors, one to a certain extent people may be buying more expensive products, undertaking bigger projects. but there is also consumers or services saying eating these

higher prices that's helping sales growth the benefit of home depot and lowe's as well is that these companies can effectively pass along higher costs to their consumers. they understand pricing dynamics well, project die nynamics well as you have the inflationary pressures making its way through the system suppliers are hit harder than retailers because retailers are good at managing this ininflation is benefitting home depot at this moment >> will it continue? >> go ahead. is there any reason, brian, to think that lowe's would have a different experience over the last months so now you would change the estimates on comp sales? or is there still enough of a difference in their, i don't know, product mix or who their customer is?

>> look at home depot's better than expected report today and that's a positive lowe's, will report tomorrow morning, lowe's has been performing through the pandemic over the past several quarters well. as i said on your show a lot, i attribute that to the new leadership i think marvin is doing a phenomenal job with that company and positioning lowe's to being a better competition to home depot. like i said a few seconds ago, worried about what may come over the next few quarters but the better way to play home improvement right now is lowe's. >> not seeing a lot of movement in the stock the high, it's almost at a high isn't it >> it is >> 375 is the 52-week high do you think we're -- next quarter we see some type of slow down in same store sales growth or is it being pushed back

or is this it, stock at an all-time high so this is what we should expect? there's not a down now should it be down? >> well, this is the $64,000 question that's it. home improvement, when i -- my view has been that as the economy, post pandemic, opens up, as consumers get back to pre-pandemic activities, you know, such as traveling, entertainment, eating out, that spending would shift out of some of these categories through the pandemic like home improvement we have not seen that happen yet. but as you look at the data, you see the retail sales report here shortly, the data would suggest to me that more and more consumers are getting back to pre-pandemic activity so i think that would have some impact on home improvement spending. it's not showing up in home depot's results. >> so that means you're rolling

out the sports coats how many do you have do you have any suits? >> i keep mostly sports coats. >> i know you do we go way back do you have 10 do you have 15 do you have 20 >> i'd have to look. it's probably about 10 i keep my suits around for weddings and other major events but sports coats for you guys. >> this is not a major event coming on with us. >> that would be the pool for you -- pond, sorry. >> i have a pond and pool. you're returning to pre-pandemic activity a nice one today. >> brian is honest >> he is honest. for important events i would wear a suit. programming note, tomorrow we'll hear from lowe's might have nagel back on better have a different sports coat a first on cnbc interview with marvin elson and hear from target and an interview with ceo brian cornell.

he wears a suit. >> we rate with him. still to come this morning, washington watch we have an update on president biden's meeting with president xi live from beijing and later walmart set to report we'll get you the numbers and reaction on wall street, ahead of that report, stock up by a penny, waiting with baited breath, investors are. "squawk box" is right back

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shares of lucid group are higher, the electric vehicle start up announced a notable increase in vehicle reservations and con firmed its production target for next year the company that went public last july off $1.5 million for the year the ceo said lucid remains

confident in the ability to produce 20,000 cars next year, 2022 saying the automaker was taking steps to mitigate the supply chain hurdles coming. tyson foods reported a jump in sales after prices in the quarter. the expenses climbed by 30% and paying more for labor and feed grain. company hiked prices in response in the most recent quarter the average brief price road near lay third to last year chicken prices up 19% and pork up by 38%. that's even steeper than we've seen in the consumer price inflation data looking at chicken prices, eggs, things along those lines. this is interesting where home depot kicks in, walmart and target and lowe's tomorrow where do the prices get passed on, where do they not?

what brian was saying about the big box able to push back on suppliers and leave inflation there. maybe they have better ways of managing these things. that's what it comes down to, which stocks to buy, which are able to find the pricing power, push it on or push it back to the supplier. >> nothing about turkey in all those statistics >> nothing that i saw. want me to look it up for you? i'll go look it up for you let me see what i find >> i was pitched an interview on the -- >> the worst foods >> no. >> for your teeth? >> yeah. did you read that? >> i just saw the same thing i read it. cranberry sauce is the worst mashed potatoes bad. >> turkey is good. >> we have the same interests, i read the same thing in the commercial break. >> i can count on you. >> i was going to write back and say this is so not important but i know all the facts now, and so do you >> i thought about you know what, just because it's a funny

thing to think about, maybe we'll have this guy on to talk about the best thanksgiving day foods for your teeth teeth are important. >> don't tell the best food. don't give that away i just gave away the worst. >> teeth are important. >> they are. >> i think it's something that has potential for a possible segment. i do. >> i think we're both suckers. this is the click bait we clicked on. >> i'm sure "today" show has them booked. coming up the morning show, see reese and jennifer talking about -- >> which one are you elon musk unloading another $930 million in tesla stock. we'll take a closer look at his strategy next. you're watching nasdaq live from the market site in times square. i love mashed potatoes kind of a bummer so, you want evs, you have come to the right place. is that tom brady? yeah. he comes in to recharge, get software updates. you know.

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tesla's market capitalization remains above the 1 treasury d$1 trillion mark buk is off the highs elon musk continues sell, he unloaded another 930 million shares yesterday after dumping 6.9 million in stock last week robert frank joins us with elon musk's sales of the stock. a million year, a billion there, it adds up. >> it's going to start adding up elon musk exercising another $2.1 billion in options yesterday, selling off just under a billion dollars to pay the taxes. that brings the exercises to 4.6 billion and sales for taxes to just over $2 billion. he has another $20 billion or so offing options that he still has to exercise along with another $10 billion or so of tax sales as part of that compensation package that expires in august but here's what's important,

musk has been making two kinds of sales one for taxes and one for straight cash. most of his sales last week were not for tax reasons or related to any options exercises, according to the s.e.c. filings he sold $5.7 billion of his non-option related shares. if you looked at the footnotes they were not explicitly for tax reasons. unlike the option sales he does pay capital gains on those regular shares, musk saying on twitter it's quote closer to tax max mization thanmin mization. by selling now he does avoid that potential 8% surcharge that congress is considering on income over $25 million that would presumably start next year so, becky, the bottom line, he is selling for tax reasons but he is also selling to take money straight off the table and to possibly avoid higher tax rates next year. >> robert, any of this you think

is maybe broadening his portfolio? making sure he has other options out there? the tax implications are pretty clear. >> yeah, the tax part is clear and what was strange to people is why he didn't come out and say, look, i have to sell for tax reasons. and the reason now we're seeing is that it's not just for tax reasons. he is selling to take money straight off the table he's got a low capital gains tax rate on that, because he lives in texas now and he doesn't have to pay state income taxes on the regular share sales. he's been borrowing against $900 million in shares maybe he's tired of living under the weight of that debt and he's been cash poor and stock rich for so long, it's reasonable to take what's now $6 billion just to have in cash. but he's never come out and explained why, aside from that twitter poll, he's doing that.

in any other company the major shareholder and founder selling $6 billion in stock without an explanation would tank the stock. the stock's been under pressure, but remember this is tesla it's different. >> i've seen a few people make the point that he's certainly not selling at a bargain basement price, robert we've seen three, four years ago if you said it was going to be well over $1,000, a trillion dollar market cap. and he's -- the prospects for tesla are the sky is the limit, everybody knows that but then again, no one ever went broke taking a profit with something that is valued fairly richly right now based on the prospects it has for the future. so just in terms of tax planning or whatever kind of planning you're talking about, it makes sense for elon to be selling stuff. i wanted to ask you a different question and that is, you're seeing these

estimates -- i don't know who comes up with your stories you do, right, robert? you say i want to do this, that, and they're always great but the cbo thing is going to be disappointing. it's not going to be anywhere near -- the 4 trillion is not going to be paid for because a big part of it which is irs enforcement, the cbo is going to come back and say there's no way you're going to get that much. i don't know if there's that much that is avoided or i don't know how -- how they're doing the math but they're saying those estimates, and the administration is telling people don't pay attention to the cbo, they're too conservative. >> yeah, the irs estimates for the tax gap are already all over the map. you have irs chief charles redding saying before congress it could be a trillion dollars a year largely because of crypto you have the irs saying the most recent estimate is $300 billion, and then you have a later irs

estimate, one through treasury saying it could be around $600 billion, so to rely on steady revenue from a tax gap that no one knows how big it is is risky you're right that will be one of the most interesting parts of the cbo score, how do you score a number that even from the irs is all over the map. >> exactly i figure we might hear from you on friday -- or. >> you will. >> we're expecting that, aren't we, the cbo -- is that due friday we'll see how they score this. and then we know what they're going to say they're going to say don't pay attention to the cbo thanks, robert i'll take it coming up, whale watching. resemble that remark we'll run you through the new investments revealed in regulatory filing from the biggest investors. as we head to break, a look at

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time now for some whale watching we'll take a closer look at the quarterly 13f filings by the biggest and most well known investors. starting with warren buffett and berkshire hathaway, shedding merck. disclosing new in royalty. >> and appaloosa sold its stake in netflix last quarter and cutting stakes in amazon by 44%. and micron by more than half at the same time making a big bet on retail. increasing the stake in macy's by more than 90% to 7 million shares and finally michael bury of the big short fame, exited bearish

bets on tesla, alphabet and k cathy woods innovation fund last quarter. bury did tell cnbc he was no longer betting against tesla and his position at that point was just a trade as for his new investments, he added a long position in lockheed martin in the third quarter. >> maybe an easier market to be long than short, right in the meantime cnbc has learned a defense department cloud contract was a hot topic of conversation at a google all hands meeting last thursday. the ceo read an employee's question outloud about the government's capability program. google did not bid on the predecessor contract because it didn't align with principals, no work on technologies that could

cause harm they asked what changed. in response they said there's many areas of the contract that could be brought to bear with no issues with google's principles. it is a sensitive balance for the company, which is trying to bolster its cloud division with high profile deals while placating an increasingly vocal employee base. >> so nice. >> do no harm, right >> hopefully they took that same focus on all their investments in china coming up, the big takeaways from last night's meeting between president biden and china's president xi we'll take you live to beijing next and in the next hour, don't miss our interview with the carlyle groups david rubenstein. and a reminder you can watch or listen to us live if you so choose any time on the cnbc app.

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welcome back, president biden and china's president xi met virtually last night it's the closest communication between the two leaders since president biden took office back in january eunice yoon joins us from beijing. what's the takeaway of this important summit

>> reporter: well, becky both sides have been painting the conversation in very positive terms. a senior administration official said the meeting was respectful, straight forward and open and the chinese side also used similar positive language such as constructive and substantive. this conversation was three and a half hours long, so a lot longer than expected which people are saying really was a positive thing they covered a lot of ground everything from climate change, north korea to human rights. the biggest issue, as expected, was taiwan president biden had reaffirmed the u.s.'s long-standing policy towards taiwan it's called the one-china policy that taiwan is part of china the u.s. official said that biden expressed concern about beijing's recent behavior towards taiwan, for example sending up squadrons of jets near the island, which has been

raising tensions but the chinese have been more focused on how president xi warned that -- warned biden that china could be pushed to take drastic action if its red line was crossed and that it's been playing up that biden said that the u.s. does not support taiwan independence now on business issues, president biden reiterated his administration expects china to meet its commitment of the phase one trade deal china made no mention of the deal instead the chinese have been much more focused on how president xi has been critical of american sanctioning of chinese companies and also of the spillover effect of u.s. macro economic policy. there was one positive development on the business side and that is china said it was going to make things a lot easier for american business people to travel in and out of china during the pandemic. they plan to upgrade, they say, a fast track lane to make that happen so a little bit of bright news,

though, no major break through. >> thank you very much. let's bring in kellyanne shaw, she served in the trump administration as deputy director at the national economic council she was part of the team that negotiated the phase 1 agreement that eunice just mentioned she's now a partner at hogan levels thanks for being here today. let's talk about this, kellyanne, the idea that the two met was important. do you see this as either de-escalating tensions or setting up the potential for progress down the road >> i think that both sides are breathing a sigh of relief this morning. there was a lot that could potentially go wrong in the u.s./china relationship. so the fact they had a meeting and not just any meeting, a three and a half hour meeting which i have to say is very extraordinary, most of the meetings last 30 minutes or an hour, is a good sign not just the economic issues

that have dominated headlines and the larger u.s./china tensions for so long, but the human rights, taiwan, military exercises are really what's at play right now so the fact the read out on both sides was heavily focused shows what was discussed in the meetings i think overall it was positive. the fact they're opening channel of communications is imperative. there's a lot of tinder in the relationship so it's critical there's an open channel of communication. >> the taiwan red line that president xi has drown and called the ultimate red line for china at least, it did seem like the united states kind of tried to say, this is business as usual, we are not arguing with the china one policy we are not pushing taiwan for independence does that then open the door for the potential for more on the trade talks or other issues? china didn't mention that at all. >> yeah. trade has just taken a backseat to so many of the other issues

that are happening i think a reiteration of the one china policy was important for the u.s. side because there had been confusion based on remarks made by president biden and other senior officials as to what the u.s. position really was. and when we talk about red lines and areas of the extreme political sensitivity, this rises to the top of the list on china's side i don't think either side is going to be in a position to negotiate much by way of trade talks. i expect the relationship will remain relatively static where it's at right now, meaning phase one will likely stay in place. ambassador tai is negotiating with her counterparts. and from the u.s. perspective, president biden is focussing on america and looking at a way to compete strategically against china and china for the large part is doing the same. >> we've seen scrutiny on human

rights issues, everything happening with taiwan coming from both the right and left in the united states politically. antony blinken tried to talk things down ahead of it saying it's a complicated relationship and the most important we have, how long can they keep it at bay? >> it's the billion dollar question, frankly. as i said, there's a lot that can go wrong in this relationship the white house was very active in trying to down play any type of deliverables or outcomes for this talk. i think the communication was so long overdue the biden administration didn't say anything about the u.s./china relationship for nearly nine months so there's some catch up that's happening right now if you listen carefully to some of the readouts and talks the senior administration officials have been giving they've been talking about the need to make sure there's no miscommunication or

or miscalculations, those are ominous terms. hopefully this is an open channel of communication there was some progress and a glimmer of hope in terms of the climate agreement reached with china and the united states at cop26. but this is going to go on for quite a while. and i think the tensions will persist for the next several years. >> your take on the best and worst case scenarios here? >> absolutely. i think this is a very difficult relationship to manage for both sides and we'll see this delicate balance play out over the next few years. >> thank you very much. >> thank you so much coming up, the ceo of zada joins us on how companies are investing in artificial intelligence to overcome supply chain challenges and check out a couple of downgrades from the analyst community this morning, atlantic equities taking robinhood to neutral. and morgan stanley moving to osual on quantumscape. the stocks both movie moving lor

right now. we'll be right back. ♪

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companies are looking for solutions to the supply chain slow down and one possible solution ai, ai technology to target customers for efficiently. joiningzeta global ceo, they start their annual zeta conference today featuring discussions on ai and the future of marketing, 51 being last year, david in 2020 641 billion by 2028. that's 50 to 640 that's compound growth of 36.1%. that's faster than the deficit that we're running in washington about the same, actually this is something we need to invest in, it seems like as for what it can do and for how much money you can make in this business. >> well it's, first of all, very little is running faster tan deficit, joe

>> that's right. >> exactly i agree. the reason ai is getting the type of attention and investment it is is because of the return on investment you get. there is very little that you can invest in that can give you better return, whether it's marketing, supply chain management or other major issues that companies are dealing with, what we're seeing now is the single-best way for companies to work through the supply chain issues are by using artificial intelligence to better manage their marketing. how do you understand what products you actually have in stock when you're going to have them in stock and how to market those products versus i think we've all been online, we've bought something and by the time you go through the 15-minute process to purchase it, it ends as a title stock or tells you even worse you buy it and it tells you, you will get it after christmas. so the ability to understand

that type of stuff and literally push to people products that you have that are comparable to what they might want, but the ability to guarantee them, they're going to get those products in time for christmas will be a big game changer for companies. >> we know the data is there we know everybody knows what we want let me see, let's say i need a toilet bowl brush. >> okay. >> socy look for that and next thing you know, every toilet brush maker in the country is hitting my -- it's like, whoa, how'd that happen? so why not if are you looking for it but you can't get that one why shouldn't ai allow whomever, amazon or ever get one as good >> it absolutely k. it's the question of the implementation right. right now, most companies as they've grown have looked at their company in silos you have one silos, which is

manufacturing, another supply chain, another inventory management i think as we've all found out over the last year-and-a-half, you know, most companies just in time inventory management is not going to work in the current environment. then you run into container issues and all those problems. on the other side of the house, you met the chief marketing officer who is simply pushing whatever they think is hottest until we fully integrate those two things which is what we're doing right now at zeta. we're importing inventory management into the marketing and the ability to tell people, you know, you might have thought you wanted that toilet brush here are three toilet brushes just as good and, quite frankly, we can get these to you really quickly. >> you know what, i want to, i can't invest if i could, i want to invest in sensors. we watch with fed-ex now, you can order something and know

exactly where it is. why don't we do that with everything to be cheap you'd know exactly where any of the bottlenecks are in the supply chain from manufacture all the way to inding up on your doorstep and you can go back and adjust wherever the problems are. that's the future. >> 100%, joe we couldn't agree more we believe that the evolution of all of this is sort of converging with multiple technologies that people see as disparate today. so, sensors, where companies can track their product off the factory floor onto the pellet into the container coming over to the united states all the way through their supply chain to the customer's house, you will have other sensors in your home that will them the company with your permission, of course, you are running low on stuff and make recommendations on what you need and simultaneously, this is going to link into the low orbit

satellite systems that guys like elon musk and joe bezos are putting up right now and those satellite systems are going to have the ability to read those sensors everywhere so, it's really going to change the game once that plugs into marking, think about the possibilities? right. you will be able to understand what people want, sort of about when or just before they want it and you will be able to know how quickly that product will lower the load so you may be able to know a day or two out of port knowing lit hit the port you will be able to get it to the person within 48 hours of the order. >> wow, we ought to get something out of ai before skynet, before we're absolute slaves to the machines and hiding and you know those hunter killers flying around, all that

stuff. in the meantime, we should get something out of it. >> we might as well get some marketing out of it. >> we might as well get something out of it before they take over? exactly. i wanted to originally call our ai platform skynet >> no no >> that wouldn't translate well our -- >> it was terrible did you see it >> we called it, i was sort of joking it was at a late-night brain storm meeting, we should call it skynet >> we got to go. we have pfizer news, we digress. thanks, david. >> we do have news out from pfizer, the drug maker is licensing its experimental covid-19 anti-viral 'ill to a u.n.-backed organization it will make it available in low and middle-income countries. the group previously struck a deal for a similar treatment made by merck. this has been a huge issue with

the vaccines as well the big drug companies said the vaccines are much more economiced to make they are going ahead and licensing it. when we come back, we will bring you those numbers and instant analysis later, the carlisle group david reubenstein on the markets, who should lead the fed and much me?or you are watching "squawk box" and this is cnbc office. hey, i can help you do that right now. high thryv! thryv? yep. i'm the all-in-one management software built for small business. high thryv! help me with scheduling? sure thing. up top. high thryv! payments? high thryv! promotions? high thryv! email marketing? almost there, hold on. wait for it. high thryv! manage my customer list? can do. will do. high thryv! post on social media? hash-tag high thryv my friend! get a free demo at thryv.com. so, you want evs, you have come to the right place. is that tom brady? yeah. he comes in to recharge, get software updates. you know.

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walmart ready to report. the nation's largest retailer kicks off ahead of the holiday shopping season. we'll get the numbers and the market reaction. president biden is signing the infrastructure deal into law. he will join us to talk about the plan and what it means for his company. a big meeting with president xi last night. we will talk inflation and much more with carla rubenstein the second hour of "squawk box" begins right now ♪ . >> good morning, welcome back to "squawk box" here on cnbc live

from the nasdaq market site if time's square, i'm joe kernon along with becky quick u.s. futures are indicated up now. we were kind of flat, kind of flat yesterday, but now, the default trade once again is to be in this market up 65 points on the dow the nasdaq indicated up 17 or so s&p up five. home depot suddenly takes a jump >> that's what i was going to look at. >> a little bit. 372.5 to 373 so that's obviously helping that one, probably helping s&p, too, more so with the dow >> let's go over to dom clu with a look at some of the other morning movers good morning. >> good morning, we're going to kick things off with what joe was just talking about with regard to home depot because america's biggest home retailer comes out with earnings and revenues that came out both better-than-expected and same-store sales, sales growth

at stores that have already been established for more than a year or so those sales growth numbers come in better-than-expected as well there is a continued home improvement boom home depot shares up three-quarters of 1% that's taking on roughly 20-some points to the dow implied at the opening bell so home depot certainly ones to watch there. we're all waiting for the walmart effect to come out as well, something to watch there also watching what's happening in certain parts of the electric vehicle battery alternative energy charging-type ecosystem quantity item scape shares are down 6% right now in the early trade due, in part to analyst morgan stanley who now cut that stock to an equal rate or neutral rating they cut the target price for 70 bucks. so keep an eye on those ev stocks here. we got breaking news, walmart coming back right now. back over to you. >> we do, indeed, thanks, dom.

walmart is out with quarterly results. courtney >> hey there, joe, yes, walmart turning in a strong quarter beating on earnings here with a president of $1.45 adjusted per share. that compares to consensus of $1.40. revenue 140.53 billion that's better than the street was expected at 135.6 billion. the retailer raising the guidance for that full year. one important quarter left to go, it does imploo i that q4 is in lean with can lift's current estimates. walmar9.2% they were expected 6.9%. instore track up 5.7%. while some of the sales growth eased from inflation it's not all of it food inflation was low single digits but grocery comparable sales grew 10% that that gives you a little bit of an idea. walmart's net ecommerce growth

just 8%. last quarter it was a 6% growth year over year over two years, the growth is 87%. it has added 21 million items to the marketplace just this quarter. walmart's u.s. operating income grew 6% him inventory is up 11.5%. they've hired associates across stores and the supply chain here to serve the consumer during this heavy hectic holiday season i spoke with cfo brett biggs who said it's similar to private years how we will serve when it comes to that inventory with so much discussion about the supply chain and when it comes to rising prices, he says, we've always been a bit of an inflation fighter for customers. our scale and products breath that allows us to do things in a way that is beneficial to shoppers and shareholders, both. he says there hasn't been noticeable tradedowns, but it's possible the retailer is picking

up traffic from shoppers that are more price and time sensitive. biggs does acknowledge walmart seen early holiday shopping activity and the fourth quarter is off to a good start he said, quote, there is no material pull forward, though, though we have sold enough candy canes to reach to the north people the amount sold at the end of the season is to stretch across the world. i guess there is a candy cane stockup, joe >> hard candy, not good for teeth. i found that out one thanksgiving no hard candy, courtney is bringing it up >> they mentioned candy canes. >> all these companies, i thought of that immediately, yeah, you got 6% inflation, you will obviously have a little boost, probably, for some sales. if i would trust anyone to manage inflation to stay low, low prices, always, whatever they say at walmart.

>> every day low prices. >> if i would trust anyone to do it and be able to do it and they have the size and scale to do it i was worried about paying too much, that would make walmart more dear to me in terms of where i'd go and they're experts at this. >> yeah. and that's why we ask the cfo that question sort of exactly. how much of this increase and sales is from inflation, how much is from demand. can you these it out we know how much grocery they sell we know food inflation is a big deal for example, food inflation across the board on average was up low single digits our grocery comps grew 10% so they still were able obviously pull forward some demand on top of that inflation as well. but we no ethat fresh food prices aren't particularly high. >> and brett briggs, becky, do you think he will ever work with barley biffel? >> not back on the bbbbb

>> becky singing paula abdul again today. >> thanks, courtney. don't miss walmart ceo documdo documcdoug /* -- doug mcmillon. we speak about the bill for nucor after the break. as we head to break, let's get a check on the markets "squawk box" is coming right back so, you want evs, you have come to the right place. is that tom brady? yeah. he comes in to recharge, get software updates. you know. let's go!

a done deal, president biden signed the $1.2 trillion infrastructure package into law. the new law will deliver $550 of new federal investments. one of the companies set to benefit is steel giant nucor, the american iran and ore institute results in 4-to-6 million tons of additional steel demand joining us nucor president, who signed the infrastructure bill into law yesterday at the white house a. big crowd there the biggest in the biden administration since the beginning, think, six/700 people, 800 people >> it was a big crowd.

great to see it after man it seems leak my entire career we have been waiting for meaningful infrastructure bill to pas in this nation. so it was a great day for the economy, for the infrastructure and crumbling infrastructure in our nation, joe, so it was a great day to watch that get signed into law. >> you can actually just look at what needs to be done and get a pretty good estimate of the increase in demand we will need for sale how much will nucor supply there is american favorite way we should do it? we want to buy american, that's included as you might imagine in this bill. will nucor get the lion share of that increase? we know there is global competition. you are competitive i think in the bill it would be, nucor would be favored >> yes, certainly, joe, nucor is the widest and most diverse

steel products company in north america. so our possibility to serve and meet the needs of our commerce and this growing infrastructure will come to fruition in the next 12-to-18 months to begin. er with incredibly well poised we have the cleanest steels available anywhere in the world. we launched iconic delivered net zero steels to our customers, the first of which is general motors again, we're excited and stand at the ready to rebuild this nation in every capacity, whether it's roads, bridges, hospitals, infrastructure, waterways, nucor is again diverse product offering will be in every facet of that >> those arc furnaces, they're not so new and modern. they are i remember when they were a state of the art, they're still great and it's almost all scrap or at least three-quarters of it is scrap from recycled material.

>> that's exactly right. we have been recycling for five-and-a-half decades, our entire history that will continue we will continue to lead we announced a 35% reduction in our greenhouse gas intensity emissions by 2030. so we believe we're one of the cleanest steel makers in the world, the united states steel industry is certainly the cleanest industry in the world again i think there is strong biamerican provisions in this as you mentioned as well as strong melted in core we got to make sure we remain a nation that makes and builds there. >> yeah. share prices obviously recovered with their reopening of the economy. it's nice, a beautiful charter i remember last time we were going shovel-ready projects, i don't know what happened the permitting, they weren't -- there is no such thing, really

are there -- is it going to be easier this time around to get permits? easier -- are these ready to go? can it happen almost immediately? what itself the triime frame, d you think? >> i think by the time we see a real impact it will be a year to 18 months to really take off what we do see that's happened now is with what's been reauthorized, which is, you know, about half of the 1.2 trillion in the new spending that's just been approved. that money's there it's available it's available for the things like broadbands, waterwayings, roads, bridges so that will move very quickly again i think our nation is finally poised after way too long and, joe, you well know the american society of civil engineers has rated us at or near failing for a long time, the 550,000 bridges in this country, about 10% of those are

deemed structurally deficiency it is long overdue again those roads and bridges will be fixed. that will move into the states as we progress so we're confident this is going to happen. again now that it's law, it will move >> well, every poll is 50-50 on anything, i think. except for rebuilding roads and bridges. that's like, i'm sure you can still find idiots. you don't want to do that, probably 70-30 it's so much better than any other poll it's the one thing we all agree on you this i that you're happy with the competition of the 1.2 trillion in what is actually infrastructure do we have to take what we can get, obviously, it's not all infrastructure, but is it half, do you think or even less >> no, i certainly think it's it's a substantial amount, so, you know, i'd say at least half

will be hard infrastructure that's going to, you know, transform into those hard projects and again really have a big impact in this nation. >> what's the global landscape look like right now? who is dumping who is unfair? who is affected by tariffs just putting this aside, the new infrastructure bill, what have you been dealing with recently, china, korea, elsewhere? >> sure at the end of the day we will face a global steel over capacity issue certainly well beyond my lifetime china alone produces over 1 billion metric tons of steel if you think about that compared to the united states, we consume and use about 100 million, 110 million tons a year. so they're ten times the volume. a lot of that steel finds its ways into various countries over the years. but one of the best things this

country has in remedies that we have that takes too long to implement. but once it's implemented is a positive going through the itc and getting anti-dunk margins or counterveiling duties associated, particularly with china. so you think back five years ago, there were only about 56 cases that the united states had won for countries that illegally dumped and subsidized their steels coming into the united states today that's over 110. so those are in place five years. they come up four sunset review, the process is muchesiev to hold and maintain as we think about the landscape. one of the most important thing is the american people have recognized our over diplomacy on foreign nations for pharma, ppe, medical equipment, semi conductors is way too much we've got to again be a nation that makes and builds things again, that manufacturing sector is vitally important to our

nat nation >> so the itc is doing a 2k3w50dz job at this point or do you still need a remedy? >> they are. again, what we've watched of recent with secretary romumdo and katherine thai very bright, know the industries well and have represented the steel industry very strong and so, yeah, we have a lot of confident. we're going to be tireless advocates no matter who is in office to ensure that nucor will compete against anyone in the world, freely, we're not free traders, we're fair traders. >> how much does china, what did you say how much they produce a year >> over a billion metric tons a year. >> how much of that is just dirty as can be? do they have -- deal with emissions at all >> oh, yeah. they're anywhere four-to--- >> prime >> four-to-six times dirtier than a company like nucor.

>> four-to-six times that's nice. >> they're not the same. >> so that doesn't mean i guess you shouldn't try. what itself the point? what is your total a year? you don't do compared to china, are you a fraction of that, you will be down 30% so what's the point? >> well, that's it you know the greenhouse gas is a much bigger issue than the united states. it's a global issue and all steels are not made the same and so as we think about building back better, as we think about the renewable space and clean energy, it needs to be built with the cleanest steels available in the world that's right here in the united states and nucor is the forefront of that leader >> just looking up you still talk to dimikko -- demicko >> we exchange e-mails all the times. >> you do? you share his politics >> i wouldn't say i share all of

his politics, fundamentally as we think about again fair trade, as we think about you know building this nation and the manufacturing sector and most importantly, joe, taking care of the 28,000 men and women of the nucor family is something i hold very dear and he did as well. >> i hear you. i don't know if i share all of his politics, either i would characterize it that way. you know, maybe 90%, no, no, no, i can't believe he's at brown university and penn. he's the most anti--- he's the last person i would think that would walk around those halls. he must have been shaking the entire time. it's beyond. thank you leon topalia great to have you on. >> thank you so much, joe, i appreciate you having me when we come back,

co-founder david rubenstein on taxes, the build back better plan and u.s.-china relations and inflames turning to crypto this morning bitcoin falling below 50,000 for the first time in november all the way back to november 1st. this happened earlier this morning. two weeks ago. right now it looks like bitcoin ck down 5% ba above 60. "squawk box" will be right back.

welcome back to "squawk box" this morning rivian ipo'd higher after last wednesday. check it out up another 7%. shares are up 40% since that strong market debut we saw last week in addition to supply amazon with 100,000 electric trucks, the company is looking into expanding its manufacturing foot print almost $160 a share. still to come, we will talk inflation and taxes and more plus, we're expecting key economic data. we are looking at sales numbers coming up in the next hour futures showing some green

arrows, dow futures up 70 points the nasdaq up by close to 8. a programing note for you tomorrow don't miss our exclusive interview with target ceo brian cornell. stay tuned you are wahi "ua btcngsqwkox" and this is cnbc and this is cnbc

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. president biden and president xi holding a one-on-one summit in the face of rising tensions over trade, covid, taiwan and human rights kailo tausha holds us with the details of the meeting >> the two leaders held a two-part meeting with a brief intermission that lasted three-and-a-half hours and served to diffuse tension between the world's two largest economies. the beginning opened to the media showed president xi on a televised monitor. president biden spoke first for the need for honesty and candor and president xi calling for increased cooperation. >> i think it's important we communicate honestly and directly to one another about our priorities and our intentions >> the white house said the conversation covered human rights abuses and mentioned

xinjiang and tibet and hong kong, and tensions in taiwan have been rising a. senior official said the president was clear to remain the status quo in the taiwan strait and acknowledged taiwan is a part of china. biden underscored the importance for china to fulfill trade one phase goals, the official saying beijing has a different view on many of the issues and had asked to remove some tariffs he referred to bind as his old friend declined to raise the issue of the forecoming winter olympics after that canvassed or policy experts whether president biden would likely accept such an invitation they were told no to be sure the two did commit to and in-person future meeting at some to be determined state and time. it's unclear, still, when that would take place a senior administration official said the white house was not expecting a break through in last night's meeting and that there are none to report, joe.

>> a myriad of issues, kayla we're in a different place than a couple years ago with all the trade issues, trade-focused issues those are still on the background, though, aren't they? we just had nucor on, we're talking about steel dumping again, those are all around. it seems like we got a whole raft of new concerns, some of them even scarier than trade, taiwan, for example. >> yeah, it almost seems like, joe, the outside is focused on trade during a prior administration dwarfed some of the other geopolitical and military issues that are cropping up now or perhaps just the fact that there is sort of the status quo on trade, therefore, all these issues are trying to sort of bleed together i will say the administration has been clear that it is seeking a sort of reset in china policy it won't use that word it's saying that unlike the previous administration, it is not trying to change china's

behavior bilaterally that's sort of an important point. that was one received, the senior administration officials says was received well by china in last night's call, instead, they're trying to approach china from the world stage with partners and allies overseas to understand that china is going to behave the way it will, it needs to abide by rules for all countries and commission on the world stage, so that is the new dynamic between these conversations and these reasons. we'll see how that evolves differently than we saw previously >> kayla, is anyone talking about we have a lot of things to think about, about russia? omany things happened just in the last couple of days, they're testing new weapons with debris out in space and the iss astronauts need to take shelter. then you've got a troop buildup on you train are you busy, are you hearing about all these things

should i be scared how are you sleeping >> not that much that's probably because i have a six-and-a-half-month-old. >> that might be why >> these are questions the state department get on a regular bafts. there is a report that russia missiles and debris reportedly flying around in space at risk to human life for the foreseeable future these are, of course, things that will be top of mind for the administration going forward, how they respond is another issue. i will say one issue, though, joe, is we are talking about these global issues is iran did come up and the two countries trade notes on how to approach the nuclear talks which are going to be apparently reviewing in the next few weeks. >> they told me i talk too long, i never heard that before. thank you, fwad to see you >> i never heard that before >> you heard it before, too. okay >> all right

up next, carlisle group david rubenstein will talk inflation and much more. oil rebounding slightly to start the week the rally may ease as global production rises. that itself hope at least. wti 81.46 a barrel brent at 82.83 we will talk to goldman's jeff curry about what we can expect as we head into the winter months, "squawk box" will be right back so, you want evs, you have come to the right place. is that tom brady? yeah. he comes in to recharge, get software updates. you know.

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with inflation at its highest level in years, pressure is building on the fed to respond and there are some calls out there to pittsburgh up the pace of the taper. for more on this, let's welcome david reubenstein, he's the carlisle co-chairman david, it's always good to see you. i have been particularly eager to ask you about inflation this time around. people have been comparing this to if 1970s you would know of this you worked in the carter administration and have been in washington ever since. could it be reminisce september of the '70s? >> well we had the inflation of the 1970s at double digit levels and started in the ford administration and continued through the carter administration at a level that went on for years. we don't really have that now in

my view. we have something that's caused inflation to rise above the normal 2-to-3% we have been having, that has been the supply chain problems because during covid, many manufacturers reduced tear production expectations and, therefore, now as demand has continued and increased, people have not been able to supply the demand therefore, there have been supply chain problems. i think they're more temporary as the fed thinks as well as well as the treasury i think we will have a trth of 2% or 2.5% for a while i don't see double digit 6% sustained either i don't think the markets do either the markets are fought reacting as if they expect 6% inflation for some time. >> larry summers thinks the fed is way behind where they should be with this and wants them to move immediately on it he also said yesterday that if you see inflation like this continue, it's going to get donald trump re-elected?

>> larry somers is a very smart person let me give you my own view. i think inflation is not likely to be as enduring as int carter years. i think it is more temporary remember when you went to college or i went to college, the standard textbook is the inflation was annualized and 3 or 4% normal we have been using 2% inflation in the last year or so more. so we've gotten used to 2%, 3% or 4% seems high it's not all that high to standard over 50 years or so i think we would be selling around 2 or 3%. i don't think it's an undo problem. it's obviously higher than some people would like. i would prefer to have lower inflation as well. >> you make the point the market isn't phased by an of this we got numbers today from walmart and home depot they seem to be managing pretty well with the higher costs it doesn't necessarily look like they're pushing too much onto the consumers. they're probably pushing back more on suppliers on some of

these things how do you kind of look around the investing world and figure out who gets hurt and what gets passed on to consumers which stocks do you like as a result >> you don't assume they will be enduring we take it into account when you make investment decision and dealing with consumer-related products, it's harder to pass along those increases you might want to have for a long period of time. right now i would say the market is focused probably more on who will be the next chairman of the fed and where that's going to come out when that comes out, i think the markets will settle down a bit i don't think the markets are unduly concerned, if gold prices were higher than they are now, the market would be reflected that there is more great credit concern. prices are fought at an all-time high, they're not as last year. >> whoat about crypto?

they have skyrocketed and some think it's a new proxy instead of gold. >> it's a proxy for some people or change their investment a bit. crypto is an attractive investment for some people i don't think it's going to stabilize the economy. i think we can use more regulation of what goes on in crypto crypt as to, though, is here to stay i don't think people will use it only as a proxy for inflation. think they see it as a way to make an investment decision and put their money in something slightly different than the traditional kind of investments. >> you make the point the market is more focused on who the next fed chairman will be i think that's probably right. jay powell has been seen as a shoe-in how he handled the pandemic if you look at predict it this morning. it has him with 67 cents to j. powell and 47 vents to brainard. you are an expert at righting these signals, what do you think the inflation is doing right now? who do you think it ultimately will be? >> remember, it's one thing to

fix somebody it's another person's thing to get somebody confirmed it's very difficult to think that anybody other than j. powell can be readily confirmed in my view j. powell is well read on capitol hill he spent more time in recent memory he is well liked there the democrats only have 51 vote in the senate. i think it's maybe difficult to get many, if any, republican votes for the president's choice other than j. powell and, therefore, i think she may well will selected but i think j. powell will offer the market, certainly will be confirmed and we won't have a long, drawn-out fight. >> i don't know if you still read the "wall street journal" >> i do. >> you do, know your enemy a little bit but milton freedman laughs last. it goes into not just supply chain but m2 growth and the

journal points out, inflation is nowhere near the levels of the jimmy carter years, but then bill mcgurn does go over a lot of parallels looking eerily similar. it's probably somewhere between the fears of people that we're going to re-visit those years and people say it's transitory and out of this administration's control. can you attach any merit to that you remember joe biden said at one point milton freedman isn't running the show anymore it was a weird thing to say about some guy that has been dead for 15 years. but that was president biden's shorthand for, you know, his preference for big government and sort of come what may in terms of inflation >> the 1970s were a completely different period of time the u.s. was more insulated as an economy 25% of the work force was unionized. today it's half that we are not as dependent on opec

prices now >> we're a lot more dependent than we were last year or a year before on opec >> not as dependent as we were in the 1970s when we really didn't produce very much like today. >> how about m2 growth, though how about m2 growth and looking at what a pure monitorist would say it's there, the potential. >> inflation is higher than the fed would like, higher than you and i would like it. i don't think we're going to the 1970s again, in part, because the united states' economy is much more diversified than then when i was dependent on foreign oil as we were then. also, we are not as heavily euneun unionized then unionization isn't a bad thing i think it has an impact on inflation. remember, we had 2% inflation for a long period of time, we're slightly above that now. i don't expect we will have a sustained inflation of 6% or so.

i think it's a temporary problem. it's not something to sneeze at. i think we should pay attention it to. i don't think it's 1970s all over again i don't see that at all. >> when you say temporary, what are you talking about? i mean - >> i would say i would expect it will be going down from where it is in the latest numbers over the next several months or so. i would expect six months from now or nine months from now, we'll have inflation at a level much closer than the fed would like it to be. >> are the critics who say the fed is behind them where they should be with a taper correct when you look at the purchases that are continuing, it's not even like we are standing pat. we are continuing to buy even as these numbers go up. what would be the problem in suspending the purchases immediately? >> well, the fed is i think trying to make certain that covid is under control therefore, the effects of covid are not with us anymore. right now, covid has not been completely eradicated. we still have a large percentage

of the population that hasn't been vaccinated. therefore, the economy is not operating as fully aswe would like it to be. the fed has said it's going to be reducing, if not eliminating its bond purchaseles i expect they will be doing that relatively soon. but i don't think it's likely to increase interest rates any time soon. >> but again, the tapering let's say that you and others who think that this is going to be transitory and temporary are wrong, what would be the problem in halting purchases sooner rather than later just to make sure that are you not further and further behind the 8-ball. >> the fed hasn't announced how it will do the tapering and doesn't intend to announce what they're doing. i suspect there will be they wereing in the near future the fed is going to figure out what will happen on capitol hill because if the legislation passes, the so-called soft infrastructure legislation passes, that would be some impact on the economy in terms of stimulating it, or not

stimulating it and knowing what's going on without inflation. >> it would probably have an inflationary impact. you are injecting more money directly into the economy. that could be pretty inflationary, itself >> if it's not paid for. yes. the question is how much of it will be paid for we don't know yet, because we haven't seen the details of what tax increases will occur and how it will be paid for. that's something that the fed and everybody wants to see >> do you think there will be a dynamic scoring on this? there will be tricks as joe manchin has said >> i think the dynamicss is progress they inquired and joe manchin said he doesn't want dynamic scoring. it's hard to know exactly what the impact will be in terms of revenues remember, what you are doing is you are predicting revenues coming in over a ten-year period of time. it's very difficult to do that no corporation runs itself by predicting what it will be doing in ten years down the road the federal government for reasons i explained has ten-year

budgeting in effect. it makes it easier to affect hud taxes and increase spending in many ways. you say in the out years, will you catch up with it it doesn't happen. >> you have these programs after two or three or four years instead of after ten years that i think is what he is specifically talking about. >> what happens often is that the country will say or the congress will say, let's have a program for one or two years therefore, over a ten-year budget it doesn't seem it's costing too much, you know after two years to end that program. most likely it will continue sometimes there are games played how long these programs will last for example, in the bill that's now in front of congress, some of the spending programs are designed to last one or two years. it's difficult to cut them most likely they will stay in effect we'll have to pay for them later. >> so manchin is right in his concern and criticism that this is games played with the numbers, are you talking

revenues over ten years and a program over unu one year you know or expect to continue >> that's true of democrats and republicans, everyone plays these games. i think we'd be better not to have ten-year budgeting. right now we play these games on ten-year budgeting, predicting what ten years is happening down the road is impossible so i would think we would be better off to have two or three-area budgeting, which is more realistic >> it's paid for david, the money comes out of the private sector one way or another. that's the other thing in this milton freedman piece. he said there is no free lunches. you say it's okay because it's paid for if it's not paid with any carried interest, would that be okay with you? >> well, whatever congress wants to do, i will live with. if congress wants to change the law, i don't make laws >> you say it's paid for, so we don't need to worry about the effect on corporate taxation or the effect on the private sector that this huge expansion of

government and everything else, that doesn't concern you at all? you are on board with this >> well, i'm obviously concerned act undo expansion of government when it's not necessary. i am sure you are as well. i do think that we ought to figure out exactly what itself in this bill before we know whether it's good or bad i think who ill the bill has some positive features, we will make sure it's quote paid for by making certain that we either getting tax revenues or dock other things to bring the spending into balance a bit. i think right now, though, we should recognize that this the a ten-area bill. over the next ten years, your going to spend roughly 65 trillion in the federal budget 65 trademark so this is about 1.4 trillion to $1.7 trademark so it's about 1-to-2% over what the federal budget will be over the next ten years it's not that dramatic >> it will put our marginal rate the highest combined federal and state. it will be the high et in the

world by 2026. higher than, second is denmark, then japan, france, austria, greece, canada, portugal, belgium, sweden, israel, so absolute top statutory rate for taxes. is that a good idea for the united states? >> well, when you are looking at the statutory rate, you are not taking into account exemptions and deductions available >> there aren't many of those left it includes all that david, it will be the highest in the world. do you think that's a good idea to expand government will it be worth it? >> nobody wants to have the highest tax rate in the world. i suspect we are not going to win that record. there are many countries in the world that will have a higher tax rate than us, the statutory rate as stated is not actually the rate people pay as you know. >> hey, david, thanks for your time today it's good talking to you we'll see you back here again soon. >> okay. thank you. coming up, we will talk oil

prices and the latest outlook for that, with goldman sachs research jeff curry, check out shares of dow component walmart after reporting earlier in the area tomorrow two big names will join us in retail target ceo brian cornell will be here in the 6:00 hour. then lowe's ceo marvin eisllon will be our guest. those interviews and much more on "squawk box." we're coming right back. we're coming right back. >>ou an estimate as soon as i get back to the office. hey, i can help you do that right now. high thryv! thryv? yep. i'm the all-in-one management software built for small business. high thryv! help me with >scheduling? sure thing. up top. high thryv! payments? high thryv! promotions? high thryv! email marketing? almost there, hold on. wait for it. high thryv!

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, oil prices moving higher, back above 81.40 they must have rebounded yesterday as well, tightness in the market may be about to ease according to inner agency report out overnight. it expect it to arrive by 1.5 million barrels a day. joining us is jeff curry, head of global commodity research at goldman sachs. good to see you. how long have you been with goldman? >> 25 years. doing the exact same thing do you remember the super spike forecast of 300 from how long ago? ten years ago? >> '07/308 we didn't forecast oil, it was

150. >> there were worries of a super intiek, though, is it about time to start thinking about that again or is this sort of another head fake that will probably end before the pendulum gets there >> this is absolutely not a head fake this is very different than what we saw if 2008 now 2008 was a financial crisis driven by the too much liquidity. that squashed in the commodity markets and drove prices higher overall, particularly the china-focused commodities. this is a molecule crisis. we're out of many different commodities, gas the stream is critical the regeneral of the old economy. you know, put bluntly, returns in the old economy were terrible exam was redirected to the new economy, choking off the supply base and we're left with the problems we're seeing today.

you multiply really strong demand on top of that, draw in our inventories, you are out of many different commodities, gas, coal, oil, we still have something in inventory, if we keep that the deficit right now, by early next year, we will be exhausting inventories there as well. >> what can we do now? and what chance we do it domestically >> let's talk about the two options that the administration has put forth? by the way, neither will do something to solve this problem. opec doesn't have enough to solve this problem, particularly if we don't see iran the first one strategic petroleum reserves of the spr. the second is the crude oil export ban so let's start with the spr. right now, they can do about 60 million barrels, more likely probably to do something around third, made a big commitment to do this. as you pointed out, the iea

thinks you will be in a surplus early next year, the doe believes prices are declineing, they will do a swat format and buy them back next year. the other thing on the table, by the way, that's worth 2 to $3 on the price. the other on the table is the crude oil export ban this is bad policy why? because you ban the exports, you will take a lot of oil off the international markets. remember, gasoline price is off international prices, this would create a spike in brent prices, wti would get crushed. brent would be over 100. and gasoline prices are correct. so you know if you instill the crude oil export ban, it will crush it domestically, gasoline prices will soar there is 11 senators who signed onto the crude export ban. it's not a good solution here. we think the likely one to do is

spr. 30 million barrels that's a drop in the bucket. that doesn't solve anything. so i am thinking, keep your eyes out on those two options >> luckily we factor off food and energy will it be harder for inflation to be transitory >> the way we like the think about that is where the system is incredibly stretched like it is today, where inventories are quite low, the system is incredibly vulnerable to any type of supply-demand disruption it creates spikes in prices. you go back two or three years ago, you needed a helioglyph prices did nothing in the audi oil field. you do that today, prices will explode. the wind quits in germany and the gas prices pop it's the per accept icy through these transient events >> i get it was your equity team

looking for 200. maybe not the commodity. >> no, they were not i have been through the oil forecast for nearly two years. >> it's murky. i am looking at a piece that went from $200 to $45 in 2009. >> he is valuing oil companies on how to expand prices for that time period. >> it wasn't you, thank you, appreciate it. >> great when we come back, our october retail sales data, mr. us the chairman of the house democratic caucus, congressman hakeem jefferies will be joining us stay tuned you are watching "squawk box" here on cnbc i'm so glad we did this. i'm so glad we did this. i'm so glad we did this. i'm so glad we did this.

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i heard that, what song is that retail this morning. quarterly results rolling in from walmart and home depot. we are expecting government retail sales data in 20 minutes. president biden and president xi meets face-to-face or rather face-to-face through a tv screen we'll bring you the highlights of the diplomacy and infrastructure is a done deal in washington president biden putting his signature on the more than

trillion dhar package. we will speak with the democratic caucus. the final hour of "squawk box" begins right now [ music playing good morning welcome back to "squawk box" here on cnbc la, la, la, la, la, i'm becky quick. >> what was that >> came was telling me about his dream. trust me, it's a doozee. i'm becky quick along with joe kernon andrew is off today. green arrows across the board. we started off relatively flat like yesterday in the markets. the dow futures are up 81 points that comes from hearing from walmart and home depot, both coming in with better-than-expected numbers the nasdaq indicated up by 8.5

if you flip it over to the treasury mark, you wwi market, went above that, we'll see if it sticks this time we have been keeping an eye on crypto currencies this morning they have come under pressure. you will see bitcoin is now just about 60,000, it fell below since february 1st earlier in the session. ether down 7%. litecoin off 7% almost 10% president biden is meeting virtually with chinese president xi jinping last night. it was their first face-to-face meeting since biden became president. that conversation actually lasted more than three hours, which a lot of people said is this is a big deal most of these things last a half hour or so it ranged on the pandemic to global energy markets.

biden stressed the need for open, honest communication. >> it seems to me, we need to establish some common sense guardrails, to be clear and honest where we disagree and work together our interests intersect, especially on vital global issues like climate change >> that was also a focus of the calm according to white house, biden says the united states will stand by the policy thatallows informal relations, but also defense ties with taiwan meantime, economy warned that china may have to take action on taiwan if certain red lines were crossed. president biden reportedly closing in on his choice for federal reserve chair. according to bloomberg, senate banking chairman sharod brown says he was told to expect an announcement imminently. current chair j. bowl have been seen as a front runner pfizer will announce drug manufacturers to experiment a covid-19 pill to poor countries

around the world the licensing agreement with medicine's patent pool will bring the drug to 95 low and middle-income countries. joe. a little under 90 minutes now until the opening bell on wall street. dom chu joins us now two a look at the morning's top three mark movers hey, dom >> earnings front and center this is a time in the quarter where that retailer story really drives a lot of the market action as becky pointed out, the two dow components between walmart and home depot were the talk of the trading desks this morning so both of these stocks, by the way, home depot and walmart are showing signs of life. let's start with a big call from goldman sachs. david costin and his team at gold man are out with their 202 forecast they're predicting a 5100 level at the end of the 2022 that implies at the closing bell yesterday a roughly 9% gain in the overall s&p 500.

coming parts of the note they do expect margin expansion in the face of rising cost pressures implying there is some pricing pressure in the s&p 500 companies for their customers. they also think that some of the value cyclical virus and inflation cyclical-type plays will outperform. they will stay away from some of the companies with higher labor costs as a part of their cost structure. you can read more on cnbc.com. 2022 says goldman sachs. david costin and that team over there. now to talk about that walmart/home depot story right now you see walmart half a percent. home depot about two-thirds of 1% both come out with better expected profit sales and better sales growth at established store locations, key for many of them walmart raises its four-year forecast and home depot again some of that homive provement trend continues for them

as we do in the third hour of "squawk", a search on the website from the previous full trading day. the ten-year note yield before we mentioned is number two on the list some of the individual tickers, tesla still front and center after elon musk sells more stock. rivian automotive with an 8% gain is roughly bigger than starbucks. to give you perspective. it's not a car company it's a very large established iconic company rivian is bicker than they are lucid and dollar trae top once and the rest on my twitter feed at the domino. i'll send things back over to you. >> i think they've delivered, there are over 100 cars now, aren't there >> yeah, 100 full vehicles >> yeah. with those, they have i think it's the front of them i've said that a bunch of times, they're smiling, the rivian trucks they make you feel good when they fly by. >> is that what you want in a

truck, though? for me the front grill should be aggr aggressive like a pitbull or a conic course co not like thomas the tank engine. you are right, thanks, dom on that theme of retail earnings, a few interviews, walmart ceo doug mcmillon will appear on the "squawk" next hour tomorrow target's brian cornell and lowe's ceo marvin ellison. don't miss either of those i'm asking, not dictating. when we come back, we will speak with the chairman of the house democratic caucus hakeem jefferies about the bipartisan bill president biden signed and we'll ask him where the rest of the president's spending ambition as we head to a break. a few more headlines, shares of ev maker lucid are jumping in the free market.

the company confirmed its 2022 production targets and recorded 20,000 reservations for the air sedan. in hollywood, film industry workers voted yes on contracts that will keep them working on productions and avoid a strike and shares of drug rilety pharma jumping on news that berkshire hathaway took a new $475 million stake in the company. that was revealed in the filings. stay tuned you are watching "squawk box" on cnbc hey lily, i need a new wireless plan for my business,

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through projectup, comcast is committing $1 billion so millions more students, past... and present, can continue to get the tools they need to build a future of unlimited possibilities. president biden signing the bipartisan infrastructure into law. the focus in washington now shifting to the democrat's shifting bill, which aims to fund child care, housing and climate change initiatives nancy pelosi expects a vote later this week. joining us now on what we can expect is new york congressman hakeem jefferies he's the chairman of the democratic house caucus. hakeem, you had your hands filled wrangling everybody for the vote on this it's didn't difficult progress why do you think we can expect a vote later this week >> well, first of all, good morning, great to be with you. yesterday was a great day for

the american people, for the economy and for america's future the bipartisan infrastructure agreement is going to create millions of good paying jobs and will fix our crumbling business and airports and mass transportation system in a way that will allow america to win the 21st century that's going to be critical. moving fore, i was very pleased by president biden's announcement, rich landrieu will oversee the infrastructure agreement that should be tremendous for every day americans. in terms of the build back betting act, that is also essential for us to get over the finish line because it will help create additional good-paying jobs it's going to cut taxez for working families and perhaps, most importantly, it will lower costs for every day americans, lower the cost of housing, lower the cost of life-saving prescription drugs and lower the cost of child care, all things that are incredibly significant in a

day-to-day livelihood of the american people. >> >> >> huph had holdouts in our own caucus, what do you expect we will see from that scoring and do you think have you the votes to actually proceed with this later this week >> well from a time frame perspective, let's see when the cbo score comes in and then we can proceed from there in terms of whether the votes will ultimately be in place, i'm absolutely 100% confident that that will be the case. because everyone would be the house democratic caucus understands that it is essential to bring this part of president biden's build back better agenda to life. the president promised that we were not going back to pre-pandemic normal. we know prior to the pandemic, half the american people reported that they couldn't afford a sudden unexpected $400 expense. this is america, the wealthiest country of the history of the

world. that's unacceptable. the great american middle class dream, which is if you work hard and play by the rules, you should be able provide a comfortable living for yourself and for your family and retire with grace and dignity that is under assault. and the build back better agenda is going to help revive that great american middle class dream. which at the end of the day you know is good for everyone, good for democracy, certainly is good for the economy. >> we had scott joshhaimer on yesterday. he did sound like he was willing and open to consider it, assuming the cbo score shows it's paid for. you have a lot of tougher critics when you get over to the senate especially joe manchin who has said he doesn't want to put this on a forecast track. he thinks he should hold off, especially with inflation. are you convinced even if it passes the house, that you will have the votes in the senate >> that's a great question i have been here for a little over nine years. i have learned to predict what may or may not happen on the

other side of the capitol in the senate all we can control is what moves out of the house of representatives. we'll have great leadership from speaker pelosi in that regard. the president promised two thing. one that no one who is making $400,000 or less will pay a dime more in taxes. we're going to keep that promise. he also indicated that the bill is going to be fully paid for over the ten-year period of time contemplated through this reconciliation process we're going to make sure we keep that promise as well when we do both of those things, i'm confident that we'll have the 218 votes necessary to pass the build back better act in the house. >> inflation has been a big problem. that's one of the things senator machi m manchin cited for november are you talking about a lot of money that the people that you were just talking about, low and

middle-income people are having to pay out at the grocery store, the gas pump and different places there is a concern if you inject more money into the economy, fiscal money with this new plan, that it could exacerbate inflation. what do you say to that concern? >> well, we have monetary policy, of course. and we have fiscal policy. in the context of monetary policy, there are some things that perhaps the federal reserve will need to take a look at in terms of making sure that the economy doesn't overeat and we find ourselves in a situation where we experienced unexpectedly pro london inflationary pressures that hits the people that i represent back home in brooklyn and queens and every day americans all across this great country while at the same, we do have the responsibility to make sure that we're executing bonn fiscal policy that will lower costs for every day americans and that is what the build back better act is going to do, lower the course

of child care by some estimates, the american people pay on average about $8500 a year that is an extraordinary amount, more than any other developed country in the nation. we will drop that down to zero for middle class families, low-income families. we will invest $150 billion in the creation and preservation of affordable housing that is going to create access to housing that will ease the month-to-month pressures that the american people are experiencing in terms of increasing rents we also, of course, are going to drive down the high cost of life saving prips drugs, pretty much agreement on that, right now seniors pay on average $6,000 per year we will make sure it's no more than $2,000 per year that's a significant gain and we will bring our country in line with other development countries. we pay for more for drug prescriptions in america than any other place, certainly our

competitors. that's unacceptable the build back better will deal with that. it will drop costs off for every day americans in a way that will improve their quality of life. >> thank you for being with us it's good do see you >> thank you >> comeble up at the bottom of the hour, inside the global quantity item computing race if you haven't heard of this technology, listen up, once it's live it will probably define sectors from business to defense for decades cocome don't go anywhere. "squawk box" will be right back.

countries and companies around the world are in a flat-out sprint to develop the first robust quantum computers, machines, that could make today's classical computers largely obsolete eamon javers joins us with more on his efforts to develop the next generation quantum computer somebody else doing that >> not me, joe, not me yeah, there are some other people who are working on that we went to the owners of ion q it's right across the street of the university of maryland just outside washington, d.c. here. over on the campus, hundreds of quantum scientists are pushing

the limit of this new technology, which experts say will leapfrog today's computers in raw technical power the u.s. intelligence warns quantum is one of the five technologies crucial to the 21st century and china and others are trying to aggressively steal these new discoveries. >> this the a giant grid people are working hard. >> the first anchor element was instilled in the hotel >> the technical and security challenge these guys have at the same the universitypresident said he's tried to strike a balance between security and open research here. >> the security agencies, like the fbi and others alluded to us to issues where there has been espionage. we do have to be careful about that i think that's a reasonable expectation of the university. >> now, at ion q the quantum

computer is already being use from customers to google to goldman sachs and they're seeing intense interests from outside the united states. >> if we look at our website, about half the traffic is from china. >> half? >> half. >> from china? >> yep people are visibly posing and trying to do various things trying to get through it >> so, guys, the kwauntd up computers at irqs are real they're in their infancy one will be finding scientists to write the programs to run on these tremendously powerful machines, when they do, chapman believes the hardware and software side will be bigger eastern than he somewhat dismissively calls today's classical computer industry. there is a lot here in terms of the impact on the hoard ware and software industry and drug discovery and science research and development. guys, back over to you

>> quantum community is probably hand-in-hand you need it to take ai to the next level, i would think? then we're looking at the singularity i think, eamon, that's when machine learning is a billion times more than all combined, human learning that's where they say we have no idea what's possible we seen computer aided design and manufacturing and engineering. there will come a time when the sum total of everything we learned from machines ellipses everything that we've ever learned in human existence, eamon. i'm excited about that we may be able to actually live in some meta type thing forever, which will be nice i don't like it one bit. >> these conversations get very heavy very quickly you know, peter chap mom of ion q told me one of the things he

thinks will happen to your point, joe, is these computers will be smarter and faster than human beings, they will think better than we do, once they get this technology perfected. that could mean the end of things in our society. computers are bet beer at doing it, what will it do? >> the end of us maybe. we do need to make sure. >> see you on the beach. >> there have been warnings from really smart people. we need to make sure they don't need to eat or the gross things we do why would they even need us? pro toplasm. thanks >> all right >> reset change the oil anyway, when we come back. breaking retail sales, stay tuned. we'll be right back. i'm just wasting time. that's why td ameritrade designed a first-of-its-kind, personalized education center. oh. their award-winning content is tailored to fit your investing goals and interests. and it learns with you, so as you become smarter, so do its recommendations. so it's like my streaming service. well except now you're binge learning.

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welcome back to "squawk box. rich santelli here with breaking news well, our october read on import/export prices and retail sales. let's start with import, shall we up 1.2%. a little higher than expected. if we strip off petroleum, off 1% area over year, prices up 10.7%. 10.7%. that is the highest going back to june and if we look at export

prices month over month up 1.5 that's well hotter than the 1% we were expecting. buckle up, year over year export prices, drum roll up 18%, that is the hottest ever going back to 1984. retail sales for october up 1.7, .3 better than expected full% higher than what is unrevised to .7 in the rear view mirror ex-autos and gas stations, remember the price of gas, this isn't adjusted for inflation that is up 1.4%, double expectations the control number, which is plugged into higher numbers up the economic food chain, that is up 1.6, 1.6. that is really a very, very solid number so, as i look across all these data points, what jumps out at me is year over year export price index and do remember as i pointed out, i want to

underscore, joe, is that has to retail sales numbers are not adjusted for inflation it makes the numbers hotter and with regard to import/export, i will throw this out there. imports as we learn ft. lauderdale the last trade deficit number, we're roughly around 290 billion at the end of the 2019, they're 150 billion. so we've seen a marked up increase in imports. that activity, of course, is due to some of the logistic problems and some of the supply shortages and interest rates, well, we're over 1.6%, 10s almost at 162 we're toying with 2% in 30-year bonds, the yield curve is starting to steepen a business the dollar index is on a roll, highest close yesterday since july of 2020 it's looking a little bit higher to date as well. back to you, joe >> all right rick thank you. steve leishman joins us now with more.

hey, steve >> yeah, this is a good report with all of the caveats that rick just laid out we don't know how much of this is inflation we can maybe guess so you may want to take that out. you may not. but these are good beats these are good numbers, a good way to start the quarter that's also important. the other thing i like about these numbers, joe, it's pretty widespread in terms of the growth seeing autos up for a second month in a row there were like five monthly declines it looks like perhaps maybe the auto situation is stabilizeing i don't think it's that easy to buy a car these days i happen to be trying to get one it's not that easy it looks like they make a little progress in stabilizing the situation. gasoline up 3.9% people maybe buying more gasoline, more important, they're paying a higher price. clothing was down, that's one aspect restaurants were flat

lined. i think it will pick up. the other thing i liked. department sales up 2.2% non-store retailers up 4% a. story here i think is twofold. you got the inflation number coming in, a little earlier christmas shopping people concerned about not getting the stuff they want for the holidays, may be out there earlier doing shopping you could be pulling forward some of that christmas or holiday shopping it's hard to know. maybe you seen that department store number up 2.2% maybe you see it in the non-store retail numbers those are things we will be looking at everything is different. another trend we are looking for quickly is a shift retail sales is really the goods part of the economy. we're looking at whether or not people move from goods over the to services. we should see the service sector pick up over the next couple of months >> we had that conversation. we're still on it the powell versus -- you don't want to talk about it, steve. i want the predictive betting

sites are moving around. will you tell us if you hear anything, won't you? >> i mean, joe, my take on this is it's a lot more of an even call than it was before. i thought it was a slam dunk call >> shocking. you admit that's shocking, don't you? >> yeah. well, i mean, it's i mean the president is going to be you know probably want his own person in there. i think there is a good chance, as i said, i think powell is one of the more progressive people >> are you sure he's the one making this decision, steve? he says, they're telling me not to do this, don't take questions. i can't do this. that's the word, maybe there are some other influencers around? >> joe, as i've discussed. i know nothing about the political process going on i know that they're out there. >> what's that don't admit that >> why >> you know nothing about the political -- i know nothing

about the political process going on in washington >> it's a part of the way you stay focused on the economy and objecting about it, joe, staying away from what the heck is going on in that crazy town. >> it informs. you should be more opened to it, it informs a lot of different things we will move on. maybe lindsay has an idea. joining us with more on the economy, the chief economist at stifel what do you think? powell gets renominated? don't you? >> i think it's hard to make the case that he shouldn't be renominated. he led us through the worst of the helm and led us for the certainty in the market. it would be difficult for biden to make the case he wants to change out the leadership, there are still a number of risks to the outlook at this point. >> the numbers that we're seeing here, lindsay and how it all

factors into just inflation worries, gold is moving a little, but not a lot. not as new highs where are you on the t-word? it's funny how we focus on individual word. that's the toward of the i guess we'll see, it was already a word, so champion oed. it certainly is used a lot >> well, we look at this morning's numbers. certainly, the consumer appears to be out in the marketplace spending more. this is the third consecutive month 06 positive spending activity as steve mentioned, this is not just consumers buying more, they're paying more for these goods, it's reflecting consumers trepidation about supply chains, restraints, being at the mindset, we better buy now, next month, prices will be higher if we can get goods at all. not to the say the consumer will fall off a cliff by the end of the year, but there are a number of factors pulling end of the year spending nearer in october and november >> well, this comment on all the

things that we talk about, and i'm talking about money supply growth or staying at the party too long, staying with these emergency accommodations too long, maybe because of delta, it's good? maybe there was a good reason for it but in your view, have we stayed too long and is the fed behind the curve right now? and even if it's not the -- everybody says it will fought be the 70s, well, it may not you know be -- history may not repeat itself but maybe rhyme at a lower level that is still really unpleasant for people paying in a cold winter or suddenly you see these, they call it a tax. it's as bad as a tax on a lot of people >> it's absolutely a tax i think the fed lost control of inflation at this point. they continue to tell us it's transitory as the economy retaliates, we will see it come down to a

palate obviously 2% level. we have to remember wage pressures are on the rise and wage pressures tends to be more sticky than price increases due to supply chain constraints. yes, prices rose because we are having these supply chain difficulties they will likely come down to the medium turn as balance restored wage pressures have largely been the result of artificial policy measures, distorting the structural balance of the labor mark the effects have proven larger than expected and will likely be more persistent. so this will create a different scenario for the fed as the economy retaliates to a much lower level. inflation elevates not through the end of the year but into 2022 as well >> well, that would seem to imply higher yield, higher rates across the board >> well, i think it implies higher rates at the shorter end of the curve because as the market begins to grapple with the fact that the fed will be forced to raise rates, we will see the shortened

of the curve follow along with the fed the longer end of the curve could be restrained by very tepid growth outlook. if we're talking about returning to pre-pandemic levels of 2% or arguably struggling to be above the longer-term expected ra it for the economy at 1.8%. that will put some downward pressure on the curve or little the upside pressure on the longer end of thecurve >> curdo you have any feeling? we got a forecast for the bond market does any of this indicate anything to you about the stockmarket, lindsay >> well, equities will continue to feel comfortable with the fact that the fed, yes, is beginning to remove policy accommodation, but even if we're talking about one or two rate hikes, we're still looking at very easy money policy even as the fed begins to taper, we're talking about a tapering process ending in june so said another way, the fed the still actively engaged in asset

purchases for at least another six months we're really seeing the best of both worlds, both for fixed income and equities at this point for monetary policy at least. >> okay. i won't ask you about fiscal policy we know what we are trying to do, it's tough to handicap and figure out, think about big joe. we're talking about biden, anyway, thank you, lindsay >> thank you >> talk to her about joe bezos, becky. >> yes, joe manchin, i know who you are talking about. i heard earlier, it was pointed out a long time ago. >> we don't need to correct people on air, do we >> at least when they're not here to give themselves a chance to demonstrate themselves. right. >> i'm not damming by, whatever it's called, we're not mentioning anyone. >> trust me, i had my own issues this morning, when we come back, we will get jim cramer's first take on another big morning for corporate earnings,.

then noah blackstein, he's uppet. don't miss tomorrow mario gabelli, investor, he llwi join us live. you are watching "squawk box," this is cnbc so, you want evs, you have come to the right place. is that tom brady?

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leave philadelphia for a big win. you go to san francisco, big win that no one, including me, was expecting, jim >> rams are pretenders they're pretenders, fugazys. we didn't know they were fugazies >> it temperatures to be home, doesn't it >> we need a few guys to fall out of the woods i think rams should go to the superbowl, i was greater baily mistaken. >> now it's the patriots again, who can handle it? you got walmart? >> people didn't like the gross margins of walmart that's ridiculous. you got to take it with some of the home wal-mart was amazing, home deproceed blown out, what do people want? walmart is barely up i know home depot had had a run. these are great. wee look at warm part being done can i say that is a joke that the gross margin shouldn't

control everything they're taking share, that's what i care about. >> we alluded to that, saying, if anybody is going to, you know, if you are worried about inflation and trying to make a paycheck last, the answer is walmart. maybe margins won't be as quick to raise prices because that's what they say. low prices always. >> they're an inflation fighter. i'm listening to you guys all morning. you know there are certain companies literally bailing out j. powell. walmart is keeping prices down aggressively therefore, their gross margins are down a bit they're taking shares from everybody. isn't is that what you want? this is the mo moment to take share. >> how about companies, during the pandemic, everybody is doing home improvement when the pandemic ends, everybody is doing home improvement they put off during the pandemic i've heard both sides. so is it the heads, home depot wins, tails, home depot -- is that a win, too?

>> if you try i to get anything done, the contractors is jammed. i think this is a halcyon moment there is still a lot of money around, yet people hate walmart. what do they want? they want dollar tree because there is an inactivist c'mon, walmart has a very good omni channel i think people expected more of every single line item that's just not the way it is. >> hey, jim, i was looking for the operating margins closely, trying to figure out what has been happening there has been this pressure from the biden administration and said, look, you better keep prices down for consumers, maybe a part of the payback. these are stores that got to stay opened through lockdowns and won a on the of market share. i don't know if they're jamming it back to suppliers how do they control it >> i this i they can jam them. they've got scale. i think in the case of walmart, brick and mortar is a decent

strategy they have both walmart and the only worry i have about walmart on walmart.com they'll send you anything, a bottle of soda for the cost of a bottle of soda they may not be making so much money per shipment but the idea that walmart should be down today after it's been down is more of a testament the market is way too much for companies than it is that walmart had a shortfall. >> what else are you going to do when are you out there i hear there are some tech companies out there? >> i will see intel, which is lightning, a lot is because they put back their growth period until out a couple years they had to admit, maybe we western dealt a good hand. he had a hand nine high, but he was claiming he had two jacks. he doesn't have two jacks. it may be a suicide kick than square they have the cards and that's just incredible. they also got a bitcoin operation.

the star of the day is lucid they're no rivian, lucid sold out, they need for capacity. look at peter rawlyinson. walmart is down. the market seems to be rewarding hope not empirical strength. >> it happened with tesla, the hope, you know, it grew into that but rivian, i mean, it's 150 cars, jim, it's worth more than starbucks. >> ford motor is the winner. they're getting 15 b. rivian and ford are rivals. they're not partners so ford can get 15 billion a. battery costs between 1 and 2 billion. ford needs many battery plants to electrify its huge feet if they did that, the stock would be 50 not 19

>> we had nucor. >> i loved leon. leon, you know what was so funny the debate about dan demico's policy, i was down by the browns, too, you think left-wing guy who is in charge of nucor that was not true. >> we got to wrap. always fun we look forward to the show in just a couple of minutes big line up on "mad money" tonight. we want to remind you about the new cnbc investing club. you can sign up and find out more at cnbc.com/investingclub or you can scan the qr code. you're wchating "squawk box" on cnbc

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last month and we learned that both walmart and home depot beat the street's expectations for the quarter. futures are mixed.

let's talk a little bit more about the markets right now. our next guest sees positive signs into year end and for 2022 joining us right now is noah blackstein, senior portfolio manager at dynamic funds the market keeps powering higher you think that's going to continue why? >> well, i think that there's a number of things going on, obviously, financial conditions remain fairly easy i think that earnings have remained strong despite higher input costs. this is the first recession that we've ever been through where you see strengthening of the consumer balance sheet is as opposed to weakening of the consumer balance sheet i think we're in a fairly positive environment that looks to continue into early 2022. not to say that there aren't risks, obviously, there are risks. but i think that from our perspective, for now, anyway,

the positives outweigh some of those risks that are a little further in. >> goldman sachs is out raising the price target for the s&p 500, up about 9% for the end of next year. i think he has it at 5,100 by the end of next year he said that he expects the margins, profit margins to increase another 40 basis points by the end of next year and that's kind of phenomenal when you consider these higher costs. do you agree with that why do you think that's able to happen >> i think when you look out at 2022 and where the s&p 500 is trading, you probably have somewhere around 210, $220 of earnings for the markets next year i think that the important part when you're forecasting that type of return, it's for the earnings to come through and i think we've reached a

point where we're -- i'm embarking on a tightening cycle for sure we have the withdraw of stimulus which is a fiscal drag i think the market can do that for investors it's important to focus on companies that can deliver on the earnings. we're not starting from a point of extremely low evaluations here do you think the market could be up 10% next year yes. it's going to be a lot more tricky than it was this year, for sure, given a few of the headwinds. but the focus needs to be delivering on earnings and exceed those earnings for the companies that you're involved with next year can it be done yes. the driver of that is going to be the underlying earnings input costs are high, labor costs are going to remain high i view that as a positive. if you believe in free markets, a good market for labor is positive overall that will get companies to automate more, perhaps, and pay up for labor but i think a lot of the input

price costs which are supply-chain driven will ease as we start to move through 2022. my only concern is there's a fed reaction to a temporary inflation that the bond market isn't pricing in and we get a bigger decline than we expect for next year. >> you think the fed is going to react and that's a bad thing we've had so many people who have been pushing for the fed to move sooner rather than later and to move pretty aggressively. you think that's the one thing that can put a dent in the market >> despite my youthful appearance, i've been doing this for a long time. other than the pandemic, i have yet to see a major market decline that hasn't been caused by a policy error. and i think where we sit today given the amount of quantitative easing that's gone on, the fiscal stimulus that's going on,

markets that are having covid issues, that there's so much fog, fog of war, inflation war, interest rate war, if you want, that the likelihood of an error is even more elevated than usual. so i do worry that, you know, historically everything i've seen has been excessive tightening, you do worry on the reaction even though i think that, yes, much of these costs are temporary and i do believe in yellen's point of view that it's transitory, it doesn't matter what i think sitting here, it matters what the reaction is and that reaction is what will determine the market and that's where i think the biggest risk was. >> noah, i never -- >> joe >> how are you doing, buddy? i kid around i'm sorry, i do. >> you

no >> i kid, ikid >> you saw the numbers, the u.s. is going to have the highest global rate, higher than canada, so my question to you is, are you ready for the influx and do you have totally open border policies like we do on your southern border as well? i just do that just to get people how do you like that that's a pretty good question, isn't it >> you ask my favorite questions which are both rhetorical and cynical. >> and they've -- neither one of them really require an answer, you're right. >> no, they don't. >> people have been -- i have asked for a commentary flash when i talk. >> at this point it's implied. >> you're behind the curve d beep, beep, beep >> noah, it's great to see you today. >> thanks, guys, take care.

>> you don't want to miss a big lineup on the show tomorrow, including an interview with brian carnell and marvin ellison. mario gabelli will join us it's worth showing up tomorrow. >> i have to, but i think it's worth it as well. >> we will see everybody tomorrow right now it's time for "squawk on the street. good tuesday morning, welcome to "squawk on the street." cramer is at one market in san francisco. future is kind of steady here as we get a good start to retail earning season home depot blows it out. >> we're keeping a close eye on those ev shares of rivian an