becky and andrew are off today starting with the markets. failed to close at a report sliding by about half a percent. dow closed higher by 95 points the dow just us indices this hour showing some moderate gains. mixed trade in europe and asia overnight. s&p 500 would open by eight points the dow by 39 and nasdaq by 5 a

1.494 is where that stands the two-year just below 30%. the 30 year at 1.92% >> referred to as something else it is an isn't week. it isn'tchristmas or new years and people isn't in for the most part as far as traders and people in general. talking covid cases. >> but you and i is in >> we is it is good to see you. you did it i know it is not for me why you are here but maybe a little bit you decided to repeat yesterday's great performance, i thought. i want to talk now about covid >> it was fun. >> it is fun >> covid, i've seen people commenting on twitter that

through this entire pandemic, i knew i heard of people getting covid but now everybody i know has covid. or it just seems really different at this point, does it not? there are a lot of people that have it. >> i hope most of them are doing pretty well, right >> yeah. it is everywhere we talked yesterday about just how purrervasive it is in washington, d.c. even when i saw you 24 hours ago, we had plans to get together new year's eve. juan of those families have bitten the dust. thankfully is asymptomatic they've tested it is affecting more and more

people >> we are at numbers that bogle the mind at this point fingers cross that we don't see

the deaths. >> we probably thought the worst was over the hot spots, washington, d.c., new york city, these areas have large vaccination levels people were out living their lives again. now we know just how virulent this is. many of these cities and states have been caught flat footed without the tests on hands even in maryland, sieker security took down the reporting for two weeks so residents didn't know how many people had covid or were dying. when that system came back online, the numbers were after

the huge in a relatively small area it is truly everywhere i cannot stress it enough. >> all along we have scott gottlieb on. he's always said the actual case count, one number. you get two, three, four times higher than that in reality. >> and test positivity rates, 15% in new orleans it was in the low single digits. now near 16% of positivity rates. for those able to get tests. it is extremely high and those that are not able or do not know that they should get tested. >> this doesn't pop my optimistic view point bubble yet. it is a lot of people but now we know from the south african

study that onlymicron does giveu immunity to other strains. it is hitting those that are vaccinated people argue about what vaccination means. like it is all or nothing. if you are vaccinated against death or serious hospital izatio or icu, that's enough for me whether because a lot of people who are getting it already have immune protection. maybe this is seeing what endemic looks like >> as we learn what endemic means. we also have to revisit what vaccinated means a study shows that the two-shot

dose against omicron, it is somewhere around 20% the third shot takes it up to around 50% >> to prevent something awful. i guess we got spoiled with different types of vaccines that are good for life. you can count on not even being able to contract the disease that's not the case here but i still don't think we need a new name for what these are. it stimulates an immune response that at least gets you some what ready for the virus. hopefully the worst case scenario is taken off the table. >> and as we learn more, polio, you get several doses during

your childhood and then never aga again as an adult because that has been enough for the rest of your life. but that took more than a decade to get into regular circulation and find the dosing and schedule right for that two decades. we'll get there. you have adults that will get this and you have new strains that will react in real time >> i don't misusing an attenuated virus to stimulate the immune system. there was sb 40, the virus was in a lot of the polio vaccine.

it does set you up for mutations you'll have to then have in addition you are not using the whole virus. maybe something we can find in every coronavirus but it is in every cold and common flu. quick in terms of advances i'm feeling optimistic maybe because i'm off for a week >> are you still going to time square, joe? >> i just like wearing a diaper. no i wouldn't go because you can't find a place to use the bathroom, which is something i frequency need to tap that resource no i'm not. i offered to open the nasdaq

i offered but i was shut down immediately. >> why would you do that to watch a 10 second ball drop. who does that? >> people who have it on their bucket list. that's all i can surmiez >> for me, it is on that other list >> now that we've already talked about adult diapers at 6:10 in the morning. we are learning more about the omicron variant. a cdc investigation about a cluster in nebraska suggests the version has a shorter incubation period for those vaccinated or previously infected. a 48-year-old man contracted on a trip to nigeria and infected

five other family members upon his return a day faster than delta and two days faster than the original strain those who had previously been infected experienced milder symptoms and none required hospitalization. while this is good news, it raises the question of how effective the tests we have now. recently an fda study showed rapid antigen ss are less effective. if you have the onset of symptoms early on or if the exposure takes hold,s does that call into question the efficacy of some of those tests >> we know how they work they are as good as the mechanism they use

if it is a really low level, it is not going to be detected. and warp speed on the therapeutics side. if you could take a pill the minute you felt bad. that is something we need to continue to pursue quickly, i think. >> yes also, the flight attendant union continued to push back at issue, the new cdc guidance only need to isolate if they are asymptomatic those changes may give businesses cover saying the cdc gave medical explanation about why they've decided to reduce quarantine

requirements from 10 to 5 days but the fact that it aligns with the number of days of corporate america is less reassuring saying it would potentially require flight attendants come back to work before they are fully healed or associate with colleagues before they are no longer infectious. dr. fauci was asked to depend. he said, we can't let the perfect be the enemy of the good dammed if you do, dammed if you don't. you are going to have shafing shortages, restaurants closed to people who are healthy and engaged. or you'll have this essentially highly risk averse environment where you are keeping people home for long periods of time. what is the right answer.

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welcome back investors continue to weigh the threat of covid as stocks move higher this last week of the year investors are more worried about inflation and the fed raising rates at the wrong time than covid. joining us now, cnbc contributor. good morning to you. you look at the headlines, it feels like there should be head winds but besides a few downed days, the market has kept turning upward is that surprising to you? >> it is a bit surprising. all of the data you've pointed out that we've received in the last couple of weeks since this rally took off since thanksgiving has painted a

picture in the back drop whether job inflation rates. whether talking about the companies and their concerns the rate of interest rates all of this should need a back drop of the head wind. the lack of data. >> so between now and sometime the end of the first quarter and

early spring, is there a good time between now and then to sell in your view? >> i'm concerned about the back end of january we'll start earnings season with the banks. they've had a very muted effect there. we'll go into the subsequent weeks. some of those companies are more impacted talks of more closures and how mandates and closures are affecting those. those are combined the daily numbers we are seeing right now. that might give the market pause for thought about some of the valuations and sectors right now, the market has looked at these numbers

it's harder to do after we've talked to these companies and after it is apparent that the visibility of the variant is causing extreme duress in our health care system >> you look at what has done well so far in december, consumer staples is up over 9% on pace for the best month in 20 years. clearly inflation is driving prices up at stores and consumers given inflation is sticking around until the end of the year >> i think i would you can't find value, a good substitute for me is safety. you look at the safe guard and the health careselect slider, the utility selector slider. these are up 4.1% since

november the s&p is up 6% that application is already giving the spread is a good indicator it is more about being defensive. when i think about safety, i think about companies that have shown us they can sustain growth whether at home, in home, prepandemic, middle pandemic, they've shown us the ability to maintain margins despite the measures we saw market expansion all of last year. they've shown us the ability that they can do that through pricing power or because they are feeling the effects a little less than the average peer and lastly, we want to be in companies that are less

effective in rising rates and what we know will by next year >> thank you, greg coming up, elon musk, share sales continue as he prepares to pay a giant tax bill i say thank you for that right now, we look at the biggest winners and losers in the s&p.

tesla's ceo elon musk has sold another 934,000 shares worth about a billion. broker goes kaching. he's been on a selling spree partly to pay has tax bill strike price of $6.24. granted to him remember that 2012 compensation package that is so out of the money looked like a good deal for everyone i think it was a good deal now estimates his network, musk at about $279 billion. it is all i can take to go full fan boy.

he's 50 years old. he sold his first video game he designed writing code when he was 12 years old 50 now and so fearless and so unwoke i'm a fan boy. i'm sorry. i am i admit it >> is that wrong you've said it >> if loving him is wrong -- >> you don't want to be right? >> yes i've tried not to and given myself to it now >> you have the benefit of being able to come tamentate on his ms investors have gotten their return but it has not gone without heart burn you have his trigger finger talking about potential things

>> owehe's on saturday night li. that's why i lalso love him. he's conceded. sort of asberger i love him >> you see a little bit of yourself in him. >> in elon musk? >> or you would like to? >> i see zero of myself in him i've had even more time to do something and here i sit >> there is still time >> coming up, a tough december for bitcoin. now 55% of respondents say bitcoin will end next year below

$50,000. more as we head to break we'll look at yesterday's winners and losers hey businesses! you all deserve something epic! so we're giving every business, our best deals on every iphone - including the iphone 13 pro with 5g. that's the one with the amazing camera? yep! every business deserves it... like ones that re-opened! hi, we have an appointment. and every new business that just opened! like aromatherapy rugs! i'll take one in blue please! it's not complicated. at&t is giving new and existing customers our best deals on every iphone, including up to $1000 off the epic iphone 13 pro.

good morning and welcome back checking the futures as you can see. about 13, 14 points on the dow the only average it was up yesterday. the nasdaq, can you see bouncing back it finally sold off in yesterday's close as did the s&p which is up about five today bitcoin is just below the $50,000 level heading into the new year after hitting $70,000 last month frank holland with more on its recent fall and the outlook on 2022 >> good morning to you

bitcoin is having a december to for get. along with other crypto, omicron has shifted away from riskier assets when the omicron news broke, that was the shift even as the volatility settled down, investors have not returned to crypto crypto and blockchain have been impacted between the assets and the stocks themselves. coin base and more seeing double digit drops this month saying as investors understand the nuances, bitcoin will instead be traded on fundamentals >> it is hard for most investors to wrap their head around mining it is a small part of the market so you don't have a lot of institutional investors.

it is hard for them to look at it like a basket >> the esg concern needed. funds increased 40%. green bond went up 40% december declines are also just profit taking at the current tax rate and investors are ee assessing when they have more clarity on rates eej eem yum and ripple also. 1.5 trillion has been paid directly in stimulus or unemployment here in the u.s how much of that has been a factor in crypto's rise. back to you. >> thank it is interesting to see the depth of the rally we saw. worst since we saw in may largely due to large institutional investors which made large bets.

do you have any idea what type of investors are exiting now are they retail investors? do we have any idea >> it is a cross the board people want to take their profit huge gains you kind of want to lock them in there has been another factor, the metaverse. he's been bullish. where the value of the cryptocurrency continues as people continue to play the game a lot turning their eyes to the metaverse and coin tied to that. >> thank good to see you. >> a quick programming note. tonight, a cnbc special, crypto night in america at 6:00 p.m. eastern time coming up, covid outbreaks

rampant. nfl with more positive cases this month than all of last season hope you weren't looking forward to the ucla bowl game. that's done, canceled. dr. patel joins us to talk record breaking days in the oous for covid spread you can watch any time online with the cnbc app.

major sports league deal with a rise of covid cases nfl revealing almost 100 players tested positive. joining us now, cnbc.com sports business reporter and from the washington sports business program. jabari, i was going to ask you which league is handling it best i guess it depends on your perspective of how it should be handled. i'll tell you what i mean. when the nfl said, if you are triple vaxed and asymptomatic, you don't need to be tested.

initially, i thought it was like, what you don't know won't hurt you you've got fans. if you are asymptomatic and triple vaxed, even the science would say, less contagious if your teammates are triple vaxed. is that okay is that a good policy to have? >> listen, you can argue which policy is good or bad or if the nba is doing better than the nfl, if the nfl has any clue what they are doing at all the bottom line is, all of these leagues have done the best they can. i give kudos to the nfl. they got their negative headlines early on guys mocking the nfl with their misleading of their vaccine statuses for the most part, the goal is to not cancel games.

to postpone as few as possible i think the nfl has done a good job of that. you are not going to agree 100% on protocol but the nfl is the biggest entertainment in american television. we need football for the most part, they've given us football. which is the goal, nba, nhl is still the goal they still have to fit scheduling in. entertainment concerts and things like that at the same time, they are changing the policies to change things sooner. cutting back on projects in the last week and a half allowing them to finish on time. >> back and forth, we all want

to have our opinion on which one is better. i think the nfl has done a good job at this point. >> i immediate liam aware someone could say, oh, it is all about the money. you've got to have these games >> jabari points out it is good to have the nfl. if you can do it safely, is there a middle ground where you don't have to feel guilty to say, yeah, i want these guys to be able to play and watch these guys on tv and do all these things if we do it safely. am i wrong >> you look at the nfl and nba, they are at least in part following the cdc guidelines they came out with rules about people being isolated that test positive and have no symptoms.

this is a business here. there are partners i do have concerns one in is the nhl. they have an issue that are dealing with two different countries with totally different guidelines the canadians are not getting loser. they are getting tighter this makes it difficult for a league that has to play in two different countries. the other in beijing and olympics we just saw michaela schiffron has tested positive. this could be devastating for rating for the olympics and advertisers. >> we are in the middle of a pandemic that was supposed to be over like six times already.

>> all can you do is create guidelines try to keep players safe and realize, the medical advice given, you still have a league to run briefly, i've been to a lot of different sporting events in the last month alone in chicago and st. louis, every sport and city is about treating fans slightly differently. in other cases you have to wear masks and interesting as we go across america through the pandemic >> you have a good point about jurisdictions changing their guidelines i'm curious how that will be at the top of the new year. other cities will come online

requiring vaccination cards to even enter how does this affect leagues like nfl and nba will we have a situation like brooklyn where irving is still only allowed to play from away games. how will that affect us in 2022? >> you go back to wherewith he were in the meat of the paean with different jurisdictions, different counties have mask mandates that will dictate in part what different teams and arenas are doing. you are more likely to see people masking up at nba arenas than in nfl games. i've experienced this in the last two weeks in different markets. >> certainly, those cdc

guidelines will empower leagues to 3u8 back restrictions i'll pose this question to you, the nba has a lot of data. they've been running these bubbles and testing and doctors have been advising the nba that the cdc has to take into account the serial testing lessons in groups saying it is very clear that individuals even 10 days out from omicron with a booster may still be contagious. they say the cdc is moving too quickly. you can say the nba is the strictest of the bunch what do you make that tweet? >> it is about getting on the same page. the cdc guidelines and local guidelines in the nba's case, i feel like the nfl is more strict

in the nba, they are dealing with player unions they have to negotiate everybody has to be on the same page they had their outbreak. they have more time to play around they are more used to these things they came into the back half of the year i think they are still going to expect outbreaks what is better is that you have better testing and more understanding of what this virus is and how to deal with the protocol it is about getting through the cycle of headlines with all these outbreaks. if you can do that during the season and not miss games or revenue, everybody is ahead of the game if they can complete their season, that's what the goal is. >> very good, jabari thank you. and pat, your resources we

haven't used in a while. it is good to have you on as well going to ask you about st. louis but, you are still a washington u. >> absolutely. down here in charlotte this week interesting to see the differences across markets eachs a different venue. we look forward to getting a kick-start this semester. >> you know, there is an article about shaved heads shavld heads are really in my producer who has a shaved head told me you guys are styling seriously. >> you are welcome to join the group any day. >> i can do it insinstantly. i don't want to shock people. >> c'mon >> we got to go. why do we have to go but we do, bye >> joe, you steal my hair jokes. oh well, coming up, bold predictions for 2022 on the fate of movie theaters. that's coming up next.

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it's been a year of upheaval in the media world our next get is expecting more of the same the top predictions for 2022 is mat belloni, founding partner i'll jump right in you are expecting baltd news for movie theaters i am wondering if you see any past pivot >> they are in the business of showing movies in theaters right now, the movie is not spiderman or one of these big all audience pitbull movies. it's very difficult to get audiences to come out to the theaters i think what we will see in 2022 is a shrinkage in the movie theater industry it's not that lucrative for

studios to release adult oriented movie theaters and the impact will be on the theaters the studios will put them on their streaming service, cutting those theaters out of the equation >> at what point do you think the demand will come back? we showed a chart that 88% of movie theaters have old. of course, it's the people willing to come in and experience it. bob eiger told cnbc he doesn't need to see it disappearing, do you ever see it coming back? >> i do see it coming back it's not going to be the pre-pandemic level study after study has shown there is a percentage of people at least for the foreseeable future who are simply uncomfortable going to movie theaters even that they can 20% dropoff, that is going to have an effect on these theaters, because they

depend on that robust diplomacy and fears have been struggling in attendance, even pre-pandemic, putting this on top of it, you will see the theater chains really struggle other than amc which has become a mean stock that went through the roof, these theater chains are really struggling. >> and have been able sell stock against that enthusiasm and momentum, too. beyond that, it's hard to see. matt, also, the streaming industry is continuing to throw massive amounts of money at their pollen count as they battle for limited hours in the they for consumers they estimate $115ple spent by streaming companies, who is doing it best right now? >> everyone is chasing netflix they were the first mover in this world they've got a ten-year head start on some of these companies so in that world, especially in

global content, which is really the battlefield right now, the u.s. is pretty penetrated, saturated. they're chasing the global audience, netflix is the leader. i think the better companies to watch is what happens with warner brothers discovery, when that merger is approved. ideally in the second quarter, discovery and warner brother together for hbo max products, that can have reality tv plus scripted, plus movies. that's going to be a pretty compelling product i think you will see a lot of movement there this next year. another is apple apple has been sort of the quiet player in the streaming space. they are really spending >> yeah. we will see what the new year brings, thank you for your time this morning. >> thank you. >> apple reportedly offering stock bonuses, between $50,000 and $180,000 to retain top everything nears

details in the next hour >

. good wednesday morning santa claus rally losing some teams. the s&p 500 snaps a four-day

winning streak meanwhile, elon musk unloading another billion dollars in tesla sharesments now what the others need to do to catch tesla in 2022 remember when jeff bezos went in space. yeah, that was this year after 2021, we will look at what the industry has in store. the second hour of "squawk box" begins right now [ music playing tial good morning, welcome back to "squawk box" here on cnbc i'm joe kernon along with kayla tausche. andrew and becky is off. it isn't christmas it isn't new years u.s. equity futures isn't down today, they aren't they're up five and change you

can see on the s&p dow jones up about 20. the nasdaq up 41 ten year close to 1.5. kayla, if we were going to do predictions for next year, i guess that would be in every single list of things to try to figure out i don't know what i'd say either given up >> i think a lot of investors would probably not want to hazard to make a guess on that one after what we've seen in the last five years for how unpredictable in that sense. we'll see. we'll see the market get down a little bit here's what else is making headlines at this hour tesla ceo elon musk sold another billion dollars worth of company holdings published yesterday musk exercising options to buy 1.6 million tesla shares at a

strike price of just over $6 per share. continuing the month selling spree, which started shortly after he polled twitter users whether he should sell 10% in tesla, even though according to filings, it appeared he had made the decision and laid the ground before he polled his twitter followers. president biden is considering former federal reserve governor treasury secretary and cnbc contributor sarah bloom raskin, according to the wall street journalal and my sources he asked raskin to be the government's most influential oversee'er of the banking system her name has been in the mix for many of these roles. but i am told by my sources because she has been on the board of governors before, she would not rejoin the fed unless it were in a more senior role,

especially after spending much time this past year grieving the death of her son tommy who passed away one year ago this week and separately rivian delaying production of its 400 mile max pack battery option until 2023 in favor of the large battery pack rivian shares down 14% this month and also in the red this morning. j joe. >> the cnbc, according to our data, 80% of investors say their top asset class for 2022 is stocks in second choice our first guest at this hour sees big opportunities in digital coins. joining us the ceo of blue print capital advisers you are not negative on stock. but you are kind of pointing to the liquidity and to the i gis

fomo, fear of missing out as one of the primary reasons for it, not necessarily the fundamentals are or more valuations are all that reasonable. >> joe, yes, i am very characteristic on crypto crypto. at this stage we have to take it back to when it all started. bitcoin has been at play 12 years. at this stage have you over 200 exchanges that you can trade crypto on and about 14% of american adults actually own crypto i think when we think back over the course of our lives, we started buying things in cash and then someone came up with the idea of using a check and someone came up with the idea of using plastic and epayments and i think that the use of crypto, the whole time is kind of where

which will go from here. i think that bodes well overall in terms of its adoption rate over the next five-to-ten years. at this stage, there are major companies accepting crypto as a form of payment. starbucks, at&t, paypal, overstock.com. so i think it would be a mistake to ignore this asset class which for a lot of us has look flexed for the last five or six years if we see a stall in the u.s. equity market and a rise in crypto, i think the herd mentality can take over here, you can see it throwing out stocks into crypto currencies, fit outperforms, it would legitimize it from an asset class diversification standpoint >> heretofore, that hasn't

happened in terms of the non-roarlation if stocks go down, crypto gets crushed, sometimes doubling and tripling the sell-off in the averages >> you see volatile in crypto. i don't think that necessarily holds into the for seeable future it's easy to look back on stocks and say when they go down, everything tends to go down with them that is certainly true but we also haven't had one double digit down market news equity market over the course of the last ten years you really have to think back to 28 for the last double dim it correction in the u.s. equity market so my prediction for the future and given crypto has sold off quite a bit in the last quarter, is it does have a strong possibility of outperforming equities in 2022 >> initially, it was about

stocks give me your opinion on that, because you like some interesting areas of the market. casinos, restaurants and airlines >> i would be short those industries >> he set rates has more opportunities. this is great. he says he'd be buying casinos, restaurants and airlines at the moment you'd be shorting those at the moment >> i would actually be shorting those at the moment. we've seen this playbook before. we bought the omicron variant producing record-breaking numbers in terms of the new cases of coronavirus and so i think we go back into another restr restrictive period and that will result in really strong head winds for casinos. for airlines, last week during the christmas holiday season, we saw out of the new york area

upwards of 3,000 flights cancelled. i think with the omicron virus, you can starting to see serious labor shortages on top of supply chain issues so i think the market is become very complacent. but again, we've seen this playbook before. we know what happens when we have a spike in coronavirus cases and we have to prepare for that that means that you go short those three sectors and you go long the sectors are prudent to be more durable during that time period. that would lead you back to big technology and some of the retailers that have gotten the ecommerce thing right. >> okay. so, one of your concerns, now i'm worried. i don't know what here is real and what is not. you are worried about complacency then >> i am very worried about complacency. the s&p 500 is up close to 30% this year we have a rally going on year in, year end

as we see signs of inflation as we are looking at 2022 being a mid-term election year which i think you will see polarization between republicans at an all time high. they try to point the finger and increase the odds and on top of that, you have a rising coronavirus cases. those factors don't lend to equity or having a risk-on appetite i think those argue for thoughts, what you have is people looking at s&p 500 returns, portfolio managers doing window dressings >> will you venture a guess for the ten year i don't want to do it next year. but in terms of the yield, what

do you think the high end would be what would shock you >> i think we're probably going to be off about 50 or so basis points on the ten-year yields. so i would put it somewhere between 2 and 210. >> 2 and 210 >> the stock is at two-and-a-half. >> you think that some of the would some of that money, would money come out of mixed income or go in at that point >> i think money is already going into fixed income. corporates, agencies, investment grade, you are looking at negative returns 2021. so i think that money has already flowed out and will continue to flow out, yes, liquidity, wealth flow out of fixed income into equities but i don't think it pushes the market significantly higher from

here we're already hearing major banks are starting to shave their numbers for 2022 we don't yet know what the full outcome thereby from the omicron variant. so i do think there will be some head winds on the first half of 2022 i think the second half of 2022 will make more sense to us >> thank you appreciate the blue print. we'll see you. jake was just talking about crypto it's a great opportunity to remind you and catch the cnbc special 6:00 p.m. eastern. crypto night in america. kayla. coming up, the final frontier in the next year after a banner year for the space industry, what can the public and investors look forward to in 2022 "squawk box" will be right back.

. 2021 was a big year for space flight and space tourism remember back in july when they reached space on their new shepherd rocket? richard branson made it to space a little more than a week before that spacex launch has now seemed almost routine. just this past weekend, nasa

linked it to the hubble telescope derrick pitts at philadelphia's franklin institute an absolutely stunning facility if i do say so, myself great to have you. good morning >> good morning, thanks for having me. >> first, tell us your predictions for next year, what you are watching for in the industry and how 2022 could possibly top what we saw this past year? >> 2022 looks luke it can be a very exciting year in terms of space exploration. there are a number of things planned to happen. first of all, nas sa has planned several test flights of new crew capsules they plan to test the test, first of all, their heavy lynch launch vehicle is a part of the art mus one mission that will return astronauts to the moon.

so they will do an uncrewed flight of their o'ryan around the moon in march or april that sound exciting. this will test the capsule and launch vehicle as well this is the first rocket nasa has newly built since the space shuttle program actually sol this is going to be an exciting launch. so there is one thing that will happen they will test each new crew capsule. the 100 star liner they will do first an uncrew test and a crew test later next year virgin clack tick has to begin getting things ready for flights for regular ticket holders at some point next year of course, if we look at the commercial side of things. we know that blue origin has to begin fulfillment of contracts for launch services sometime next year. they have been doing the tourist thing last year, which was exciting enough. they need to start making money. so they have to start fulfilling

some of those contracts. they will also implement a new heavy launch vehicle new glenn the number of things have happened from there keep going on and on. oh, spacex, by the way, will do its first orbital test of its jie gaventic starship. this is the rocket craft that will take far more payload than any of the rockets have done, so in the past, this will open the gates for nasa to get the art mus program on the moon started, because this will be the landing system that will be used to take astronauts and pay load down t the surface. >> right >> well, it's not just any pay load that spacex will bring up to space it is expected to bring up to 30,000 internet leaning satellites into low earth orbit. but it's had a couple close calls that the chinese referred spacex in a complaint after a close call with chinese

astronauts in one of their space stations had to essentially dive out of the way by a couple hundred meters to miss an incoming satellite i wonder what you make of the traffic jam up in space and whether you could see u.n. governing bodies in the next year >> the space junk problem has been increasing ever since we had access in the late 1950 early 1960s. but the proliferation of satellites like those being used in the program by spacex to provide low cost/high quality internet access around the world, really is going to challenge our ability to figure out what we need to keep in space, what we need to deorbit from space so we don't run into an issue where satellites are crashing into each other that will create an enormous problem if that begins to happen so far, spacex has been working with our space command network to make sure that none of these

collisions actually happen, but there have been these close calls. will there be a regulation next year well, spacex is working with every agency and every sort of inner connection point to try to figure out how they can manage to keep things straight. and so far, so far, fingers crossed, that's no way to do science, but so far, nothing bad has happened however, there is still a possibly that there could be a collision that would create even more pieces of junk that would ten simply become flying bullets that could impact other spacecraft you really don't want that scenario to develop. >> yeah. that's very true and spacex is registered with the sec for up to 30,000 satellites to be launched into orbit. derek, you mentioned at the beginning of this segment. we did space tourism this year at some point there will be ticketed passengers as soon as next year. what's the reality for virgin flak tick or another carrier to

bring the average consumer up to space in 2022? >> we first have to get rid of the average consumer him tickets for the virgin clack tick missions or flights are already a quarter of a million dollars so this automatically limits the people that can do this. will they get so much more reasonable that a regular person can do this? that will take at least a decade for that to happen they do have to get started getting rid of the back load of those people who have purchased tickets already. it's above 400 it's probably 500 that have purchased tickets and are waiting for their turn to go the idea we will see regular trips of average people to space there is still a ways to go before all of the safety margins are satisfactorily met that it

seems a regular and easy thing for people to do with a margin of safety completely acceptable. at the same time, that has to come down if it's not below say $25,000. how many can do this then it remains a carnival ride for people that have the money to do it >> yes programs it will take a while still for the average consume tore get over that trepidation i don't feel great about carnival ride. i would hope that this is more than morning nalley safer than that of course, we got some time as you put it derek we appreciate your time this morning. thanks for joining us. >> thanks for having me. coming up, tesla versus the rest next year and beyond, could anyone catch the ev giant? we will debate it from a production and investment standpoint when we return.

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hard to remember no one thought it was going to go up that year at all welcome back to "squawk box" on cnbc a big geopolitical story for investors to moven tore recall in the new year. you know what it was before we get to the story you know what it was founding of "squawk box" >> 1995? >> 1995 a. good year to do it. more s&p records the u.s. and russia say top officials. >> as a trick question >> will hold security talks on january 10th him topics will include military activity and rising tensions in i craven. they la, you have been looking into this from you nikkei insights >> yeah, it's the biggest foreign policy challenge, joe,

for the white house. it is also the biggest potential for investors to see a black swann event at some point next year the administration has been doing deterrence in diplomacy. at least on diplomacy, there appears to be some engagements that will happen you mentioned january 10th discussions between u.s. and russia directly. yesterday, president biden was asked whether that would be at the leader level between him and mr. putin. he said, we will see two days later, russia is expected to hold talks with nato he has been seeking reassurances that nato will not expand. they have been unwilling and unable to guarantee that the following day, the permanent counsel organization for security and cooperation in europe, which has on the ground monitors in ukraine, they are going to be talking as well. so really all of this concerns the buildup of russian troops brinksmanship the possibly of an invasion, which the administration still does not

know whether putin will proceed with i asked national security adviser jake sullivan the week before christmas, whether they have a clearer assessment. he says no i asked the former nato supreme allied commander admiral james stavridis and here's how he and he capped that to me. >> the biden administration will be deeply concerned about vladimir putin there will continue to be a difficult inlocutor. the invasion of ukraine is one in five, which is unacceptedly high >> one in five so that is not a majority percentage but as he calls it unacceptably high. when could it happen some experts suggest that perhaps as we get into winter, russian troops in very cold weather, they could be ready

then stavridis thinks differently he thinks it can happen a little later. here's what he said. >> he has 100,000 troops currently parked on the ukrainian border he will take a breather and not make a move until after the olympics in february. >> so he believes that doing such an invasion before the olympics would be a distraction to the rest of the world he would want to do so at a time when there would be more attention on that situation before the olympics are, of course, on the world stage, joe, that is going to be the story overseas, that the market and establishment in washington will be watching as they try to deter putin in the ukraine >> can there be two elliss we have china and russia i think they can in terms of global instability

and what's possible in terms of really those are black swans both of them, either one, i think, either taiwan or ukraine. >> yes all jokes aside. we entered 2021 thinking that china is going to be the biggest challenge for the white house and while it is a strategic challenge to borrow the words of stavridis, the tactical challenge now is russia. so we'll see where they go from there and how they can contain some of this risk that has really become apparent >> when you complain of getting up at 3:00 a.m this is not that ba it's a good give you can see why those guys >> this is not a hardship

assignment far from it. still to come, restaurant, stocks, who is in the best position as we head to break, maybe grab some breakfast, oatmeal and coffee on pace for the hottest year since 1995, pun intended coffee is on pace for its best year in more than a decade stay tuned you are watching "squawk box."

>> welcome back to "squawk box," apple giving big bonuses to top talent bloomberg reports the tech giant handed out awards between 50,000 and $180 thousand in restrictive stock to certain engineers as it looks to keep meta and other companies from poaching talent apple once again is near the key level of $182.86 and at that point it would reach $3 trillion in market value. we spoke with investors about apple. for the latest edition, more than 40% said they expected to be a leader in next year's

market, just under 60% that it's reasonable the stock could slow down when we come back, if 2021 was the year for ev stocks, 2022 is the year for actual deliveries so says one of our next guests what should investors watch with tesla in this growing field of wl lkits? weilta about it when "squawk box" returns >

. we are seeing a huge shift

towards electric vehicles up until now, tesla founder elon musk has indoored being first mover advantage, but with production issues, likely coming to market in 2022, we want to know if tesla and founder and managing partner you are on me you are not on the same place on this we need to see. what does gordon, what is he smoking to get to his position

on this. you think tesla is the market leader and will continue to lead there is a portability question. evs are gaining on the pricing side you have a $50,000 vehicle versus competitors largely above and i would agree with the setup 2022 is the year of liveries the third piece is they can deliver over a million or 3 million vehicles up from 900,000 in 2021. to put some perspective around that 1.3 million i think rivian will deliver best case around 70,000 lucid best case 17,000 and we're

talking about tesla between those three delivering 94% of the vehicles i want to finish this one thought before i turn it over to gordon that is by definition there is a definition of losing of market share there wmpb you are giving up 6% of that if you look at the arc of where it's going, tesla will be in a good spot in 2022 >> okay. gordon >> all right listen i think that tesla's valuation absurd representing an evaluation it needs to go from roughly 20 million cars, that's what regina is saying. tesla needs to ramp and build and basically come out with a

new factory for cars sold out. clearly they're not doing this it will take 20 years. they are not building a new factory every six months you got to discount that back. people with tesla stocks expect to own 20% a year. they assume factories. 500,000 per factory completely sold out you discount that back and talk about a $30 stock. keep in mind in china the market share falls to 11% they're not leading. they're outsold and gms. they are sold two times and the market shares fall between 33% to 15% in china, dw is expected to sell two-thirds, 75% this quarter they will surpass them next

year tesla significantly loses. the idea that the valuation makes sense, every quarter is sold out they will not do this they're more than a car company. 95% comes from selling cars so for them to try to justify where tesla is off he needs to explain how they will sale sold out factory every quarter, i don't think he can >> a lot there, gene maybe i can start with the market share piece there are areas they are losing share fractionally, it is gaining. the analogy i would give to think of what's happened with apple.

i do think that tesla has opportunities to be viewed as a tech company the analogy i would put would be an iphone call it 90% of the smartphone, today it's 18% of the market however, that's a great business for am and i think similar trajectory will place forward. the market as you mentioned at the top, we're talking going from 3% to 100% i don't know if there is a way i was hopeful, we would be on the same page on this next topic here when talk about tesla's valuation. we think of rivian and lucid valuation. i don't know how he thinks about those. tesla is a 100 stock i think lucid will have difficulty in

manufacturing and will see stumbling here do you ever wake up and say it's at a thousand. i need to re-visit some of the way i think about things >> i don't hate tesla, i think the stock is grossly overvalued. >> >> tesla, stack down to 150. i think it went up to 400 and fell back down every single asset blew up listen, tesla, gene and others said previously they leave it to technology we know that gm and waymo have taxes on the road right now.

you can see technology driving into the delay of other cars you'd have to be blinder than stevie wonder not to see that's the last from that perspective that's in our view a legal risk. so listen i know that stock prices, tesla's chinese factories. we need to see the financials. i believe the costs are loaded i believe making it significant for the company they are between 35 and 45,000 this quarter, to justify where the valuation is, they need to grow 3500,000 per quarter. which means they need to ramp every single quarter i'd like regina's plan, reality will set in with all this free money in the market.

>> i don't know, now, 2018 it wasn't at 300 unless you are using three split numbers. it looks it was way below that let's say five years from now, tesla is a viable company still doing well, let's say it's near gene's target at 2500. at that point would you say my analysis didn't take into account everything else that it should have taken into account for the stock price? i was right about fundamentals, about this whether it's the fed or whether it's you know a greater fool theory took over whatever it is, would you say, wow, that was the lowest stock in years i could have been short? >> here's what i'll say, listen, valuations matter. we are seeing that at a number of these mean stocks for tesla to be at $1,000. they need to sell 20 million cars a year. even at that right right still it's overvalued by

1 100% i'd like to know. >> how are they going to do it, gene >> i'm on a totally different spread sheet here of perhaps gordon has those numbers it can go from 900,000 vehicles in 2021 to 1.3 million just under 50% growth i think that will continue to move the market cap higher that's less than that that gordon has laid out. so my response to gordon's question about how do they get there? i don't think they need tab at 20 million cars in ten years i think they can get there over time i don't think they need to have that kind of i forget what the number was per quarter i'm on a much different page.

>> you bring it. you got the numbers and facts behind everything. we'll see gene thanks. there is an sold simpson's episode. who people are on cnn. like anne coulter and a leftist, that was great and they give each other a high five and head off to lunch together it's what i was thinking you guys could do, maybe maybe you are not close enough who is buying? gene might have more money >> i will be in new york next week. >> you are probably not going, all the flights are canceled anyways. thank you. happy new area >> thank you. a casualty of remote work, the post-segment lunch speaking of lunch, who is hungry we go from driving to drive through. top restaurant stocks that need to be on your radar r fothe next

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covid is once again disrupting restaurant chains so what are investors to do in 2022 kate rogers takes a look. >> reporter: after learning how to operate in an ongoing pandemic, the restaurant industry continues to face many challenges as the omicron variant continues its spread analysts are looking at names that operate well in fully opened and restricted 55s and

pricing power and flexibility as inflation continues to wee on the sector the top pick for 2022 is starbucks. >> our belief is investors should own names that cater to a higher demographic in 2022 we believe that in the restaurant space, value is going to become more a focus over the coming months and quarters. >> and for andrew charles, chipotle takes the hot spot. that i have room for runoff pricing. >> it a name where it's justify and the sales strategy the company is pursuing focuses on symbiotic sales drivers around social responsible, digital loyalty and innovation >> another buying opportunity includes wingstop and two publicly companies sweetgreen

and dutch bros both have strong digital platforms. that will be important commerce want to interact for the foreseeable future back over to you. >> thanks to kate rogers for that look. joining us to talk about opportunities, you just heard from him the manager director so peter you gave us a little preview there of just like starbucks. i'd like you to elaborate on that it would use pricing power how much-at-what costs >> thanks for having me on i like starbucks for several reasons, number one they have reset after last quarter two,

stock has under performed for the majority of this year. then three, i would tell you that they cater to a consumer, inflation will be with us for several years they have the ability to raise prices. the issue for starbucks hasn't been lack of sales it's been margins and last quarter's margins. they made a significant investment which drove the margins several hundred basis points they only need a 4 to 5% increase in north america to fully offset that margin pressure if you consider what other operators are taking in terms of pricing, mcdonald's is running more than 6% on pricing. we are seeing that from several other operators. chipotle is in the high single digitles there is no reason to think starbucks can't raise prices without significant pushback on

the traffic side f. they do that, i think you can see the earnings estimates rise again and we can achieve the prepandemic margins we saw several years ago. >> peter, you also like chef warehouse ticker chef. the company caters to high end restaurants and also consumers selling them everything from seafood to confectionery products to other types of food and i am wondering why you like that company and why you think it will benefit from the period we're in >> our thesis for 2022, is i think you want a consumer that can absorb these price increases. that's what chef's warehouse does they indicator to four and five-star restaurants that are raising their prices substantially. they're not seeing pushback in terms of that level of price

increase in our view for chef's warehouse, where the downfall has been on case counts in their hospitality division as mobility increases, travel increases across the country, people get back to some sort of work conferences are coming back online i realize we have this new variant that may be putting a little of a dent in plans right now. but i think as we get back to more normalized situations, with their pricing power, i think you will see chef's warehouse win in this environment they're making significant moves in terms of acquisition, which will boost the top line and flow through to the bottom line as well. >> already up 30%. looking at that chart right now. finally, peter, we have been talking about these stocks you will benefit from affluent and high end consumers and papa john's pizza, which i wouldn't think would fit that mold.

the company is rolling out a new york-style pizza if it wasn't broken, why fix it? this is sort of like michael scott declaring sbarro was the you a then in theic new york slice. do you think consumers will believe that this is what tastes like new york city >> i think for papa johns, they have low hanging fruit they worked several years on an irrigation pipeline. they have one or two products. their average sales volumes are the highest they have ever b been that is resulting in an acceleration in development not only internationally but in the u.s. as well all that is coming together in addition this is an under

lever and company, which has operating margins and there is multiple years for papa john a lot of low hang fruit yet to come >> happy holidays, happy new year >> happy new year. >> coming up, the very latest on the surge in omicron cases dr. kavita patel will join us from the brookings organization.

. good morning, investors turning off the surging covid case count on cnbc, there are more worries about inflation than the fed your playbook for 2022 straight ahead. and will 2022 be the year of the metaverse? if so, you might want to put some money to work there we'll bring you investment options to consider. plus a warning to anyone that ever used esg scores to make investment decisions are you sure you know what they're actually measuring we'll clear up a common myth perception as the final hour of "squawk box" begins right now. >> good wednesday morning. welcome to "squawk box."

becky and andrew are off today u.s. equity futures have been mildly in the green. it would open to the downside. nasdaq up by 23 points this reflects a little of what we saw yesterday in mixed trade, the s&p snapping four-day winning strikes. the dow was up for a fifth day it will use a santa rally as it has in the last six years. that is the psychological level we have been watching some time. it appears today is not the day it will budge. >> soon. according to most recent cnbc quarterly stock report, the biggest two worries for investors in the coming year are

inflation and the fed raising rates at the wrong time. steve leishman joins us for the play book. those are mutual concerns. >> do they mean wrong times, joe? >> too late. maybe too late maybe that's what this is. >> maybe some are too late look, joe, here are three things to watch you nailed two of them the virus inflation and the other one not on that radar is personnel. fed chair j. powell is expected to get some support. some senators could oppose president biden has three other spots potentially. two jobs keeping you permanently filled so that's five officials, how hawkish or dovish?

powell's leadership should provide some consistency virus and inflation will determine how far the fed goes there are likely more price hikes to come in the system, including from wage gains and housing. that would be true if the bottlenecks clear in the beginning of the year. the virus can prompt them to ship goods it can hurt growth for things already in short supply. it's worse than inflation. but in the consumer activity, it could prompt to raise it more slowly >> we'll see, i guess.

ri right? >> kayla, what do you think? >> i don't know, certainly it's not my area of expertise i want to talk to steve about personnel. it's something he and i cover closely. for that bank regulatory position we talked about sarah bloom raskin, a few weeks ago. they have been prompted them to that hole. there is a lot of questions about confirmability just this week, senator warren put out a tweet lambasting institutions for their carbon foot print that was seen as maybe the discussions around sarah bloom raskin for that role had taken more shape i am wondering what you think about her for a role given she

is a known entity and that's something. >> i think she has expertise in monetary policy and the treasury and finance as well. it's a political question. what i would like to do is put me on the other side and you on that side. i want to question you i want to turn the tables here now. i don't think, i want to question you on the brainard you have to be on the other side here we go on the brainard nomination is there actual what's the word, organized opposition i think i have to turn that way. organized opposition to brainard in a sense that she may not have votes in the senate or do you think that will get through? >> i do not think there will be

unified opposition to democrats and we seen vice president kamala harris step in and do a record number of tie breaking votes for nominees so far because of the late harry reid of course, you only need a simple majority. i think there would be support for her. she is quietly been building reasons of the years so whether those republicans feel strongly enough to come out and publicly support her in this environment. probably not that being said, it's not believed there will be organized opposition although, anything can happen. >> i want to say one thing i this i the key is policy and the key part about policy is inflation. it's hard for me to imagine too dovish a fed board at this point

no not view those three hikes and to respond inflation i think the question is as to how dove ib or hawkish this fed board would be, this new committee would be is more a question for 2023. i think they will start to hike rates, end qe. i don't think they will mess around with inflation at five or 6% and foughnot raise rates or e policy >> do they keep up with the hiking in the face of a gross pullback if that happens towards the end of next year >> i think a gross pullback is built in it depends, you have this tension now between the virus could potentially reduce growth but also worsen the supply chain problems i think we have to see those supply chain problems work out we have to see, by the way, if this virus spreads through the economy quickly, people go back to services. one thing i seen in the forecast

is people were banking on a declining inflation and increase in services inflation. ihs, those folks, they put that off. they don't think they have it until the second or third quarter. what happens all the concerts, flights canceled people under up buying goods instead of services. >> yeah. we will see, steve, appreciate it see you soon, steve leishman coming up on "squawk box," new york city school system overhauling its covid policy it will now ramp up testing to avoid school closures. we'll talk about the text to stay strategy. a surge in case numbers next with democrat. kavita patel as we head to break, the moves and shares in victoria's secret. the retailer announced a $250 million accelerated buyback program. "squawk box" will be right back.

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comcast business. powering possibilities. the u.s. is breaking daily records for covid cases yet again topping 267,000. this coming as the cdc significantly lowers the estimate for omicron prevalence across the country saying it accounts for 59% of

cases, that's a significant big decrease from its previous estimate joining us is dr. kavita patel, former white house health policy director and also an msnbc and cnbc medical contributor we are grateful to have you here with us today. thank you. first of all, let's talk about the convergence of delta and omicron. they are two strains of this virus that have different attributes but if you are someone who is hoping to get together with family or friends for the new year, this upcoming weekend, how do you manage going into this weekend? >> yeah. this is probably one of the most i think essential questions given what the cdc kind of revised based on its forecast team i don't think the implications are different for this upcoming holiday celebration, meaning, we are seeing shorter incubation periods. but we're seeing a mix on delta

and omicron, people seven days after a contact? you have to make sure going into this you try to restrict movements and limit contacts before you go into a holiday celebration. of course, making sure everyone is eligible and boosted. it's not too late to see the effect of rathering tomorrow testing. if you can, try toize late people who have symptoms from not even bothering to attend if you even feel a flicker of a cold, a nosey nasal drip you know is allergies, stay away, stay behind. that is probably the best advice going into the weekend >> that is really goods advice democrat pat em, but for the last week, it seems like my social media feed going into christmas was filled to the brim with people

posting their buybacks and rapid test results essentially, look, before you judge my pictures of me with 150 people, look at this, i got a negative test. but we're now for people who do have tests that they can still use at home, we are now getting some information from the fda that maybe some of those rapid antigen tests, people that want to do that before getting together, what's the caveat you would offer them now in. >> yeah, that fda advisory will likely get built upon. we are doing the testing in the real world with real patients and live virus samples i think are you right to point out, there is limited sensitivity. i saw this we are seeing this play out in the real world, though, limited sensitivity is translating to people who say i'm negative three days in a row that pcr on day two was positive by the time i get it back. if you have the rapid tests, use them, don't let them substitute for common sense what i mean by common sense is

that if you got a large gathering, that's just a risk. it's highly likely with 280,000. athan that's an undercount we probably have a million cases or more because we can't diagnose them. at-home tests are not reported in those numbers most likely with that many cases, a large gathering, you will absolutely encounter somebody with covid. you have to think about that as every large gathering? what do i mean by large? over 15 to 20 people somebody there will have an infection and you should have in your pocket that n-95 or km-95 or kf-94 and use that wisely when you are in a larger group i know that's hard but that's where we're at. that itself what you want to do if you want to prevent getting inf infected >> after the parties and fanfare this weekend, next week, children will be returning to school most of these schools have test strategies i have a 3-year-old. she goes to preschool.

even she will have to do a rapid antigen monday morning before going to her little class. now given what we know about these antigen tests, whatt the level of safety and efficacy for having kids return to school on monday or do you think that if a family has been out of town, has traveled toa high risk area or has a child with a run my nose that perhaps that child should just stay back >> i do. i'm in the same position my family with two young children took a vacation we actually came back early to have what i call a washout period that was something we chose to do just for this very scenario so that i could have time and before my children go back to school try i to get them a test. that's not easy to do. even i am having challenges. and i do tests the every day i think you are right, if you got somebody traveling back. anybody with symptoms, even if the rapid antigen test is negative withan abundance of caution, keep those children at home. how long do you need to keep

them at home it's until you get that i would feel much better having my children or your child that pcr test that's negative that can be your range but it might take time and those results might take a couple days to come back that will give you the certainty getting your children in that school setting is it safest baseline possible. then the test to stay. once you kind of reset after travel and after a negative test with a pcr >> yeah. it's not what a lot of parents want to hear, myself included. >> no. >> finally, you mentioned a booster. corporate america has been one of the first movers on the vaccine front in requiring not only employees by visitors to their facilities to be getting vaccinated now boosted. gold medalman sax is requiring third shot for it premises the biden administration will have this vaccine mandate heard by the supreme court january 7th. reportedly, one of the reasons why it does not want to make vaccination a three-shot

definition is because of the legal language if there. but do you think that we should see a change after the outcome of that case >> i do. and i think even to your point before that, i have been encouraging employers small medium and large to go ahead and kind of update their own private sector definitions to include, just so you know, my own healthcare institution, the clinics i work for, that i have done the exact same thing. they have given us ime they've also said, look, we consider a part of the vaccine mandate to include a booster let's be clear, now we are seeing the uk, israel, it's not a booster. we need the third shot we're calling a boost tore complete the series this is likely going to become a more regular occurrence that we should have included in the definition of fully vaccinated we can give people time to do it it doesn't have to take effect immediately. we need to update that and i encourage people to do it be

every the 7th hearing and hopefully the administration will follow after that >> dr. patel, important advice as we go into the final stretch of the holiday season. we appreciate it coming up, if you've ever used esg scores to make an investment decision, i don't know what to say no, but make sure you know what they measure it might not be what you think we'll explain next as we head to break, check out the price of crude this year up more than 55% "squawk box" will be right back. >> when you really need to sleep you reach for the really good stuff. new zzzquil ultra helps you sleep better and longer when you need it most.> it's non habit forming and powered by the makers of nyquil. new zzzquil ultra. when you really really need to sleep.

. >> if you ever used esg scores for decisions, you are very sirsir c chuousffff virtuous. >> carbon emission or more treatments, esg ratings measured the risk the world poses on the company and the bottom line. rating providers sift through hundreds of variables. for example, how a company sources water ordeals with corruption they crunch the numbers and come up with a single esg rating. so i asked the head of s&g global why scores aren't consistent >> the metrix and the indicators that companies have to report

are changing standards take a while to emerge. there needs to be some kind of agreement around what the right metric is. >> so that means metrics continue to vary they rate tesla 37 out of 100. you see on the right-hand side where it gets an average rating from msci and 60 on the reciditive on factset an average score. the scores vary so much. do they give us investors a sense of what they're dock for the environment, social justice and corporate governing? >> i would say that everyone wants to contribute out there. i would be skeptical if esg investor as a category is going to move the needle >> the disconnect between accelerating esg activity and confidence in the results could serve as a wake-up calm for

companies and investors alike. joe. >> oh, boy >> why, oh boy >> now i don't know what to do, i had it all planned out and -- >> and what was your plan? no lol low esg scores? >> to effect these things through my investing i don't want to invest to make money. i invest to feel good and to feel i don't know just a different guilt that i have. >> i see where you are going with this. they are trying to stream line it they are a science-based targets, creating desks, a climate task force have you these task force working towards creating these one global definitions, but unfortunately, we're still not there yet. and these guys that have been rating these have been doing it ten years, the big question is, why is this taking so long >> do you see hypocrisy in this stuff? >> i am a journalist

i am in the middle i see where you stand. at the same time they believe it's going to get better in the next year or two however, we are not there yet. the correlation between these rating agencies is actually 30.61 if i remember correctly. >> let's say we found out, christina, that foreign investors that all the esg calculations, that it actually underperforms normal the esg, something like that. if you want to be an investor, should you accept the lower return to feel virtuous or what do people invest for, for family, future, retirement, for what they're trying to do or invest to tell their friends they're esg investors? >> it's their own personal values it's up to them. you have a great seeing e segue, i will be answering that next week the performance and how well they do is it because they

are esg fund and rate high hor they're a little more transparent and they have the money to get these esg ratings in the first place i'll have that for you i promise. >> i know bill gates, he still flies a lot on that big, big jet of his but he buys carbon offsets so the carbon doesn't really count that he puts in. and what's $7 million to bill gates? >> pocket change church change. >> he gets to live in a 5,000 square foot house that has the carbon foot print of denmark he buys offsets. you don't see any hypocrisy. thank you, kayla may i digress, kayla >> take a look at the forest, see how nice it is, a good looking forest, joe. coming up, will 2022 be a good year for landmark legislation? we will dig into the potential

changes straight ahead arms programing note, tonight don't miss our cnbc special crypto night in america 00 p6:.m. eastern time for now "squawk box" will be right back your record label is taking off. but so is your sound engineer. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire matching your job description. today, business is a balancing act. you want your data to be protected and secured. and your customers want seamless and easy. with ibm, you can do both. your company can monitor threats across your clouds, address all those regulations, and still create all new experiences.

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welcome back to "squawk box" on this wednesday morning. former senate majority leader harry reid has died. he was nevada's longest-serving member of congress he died peacefully surrounded by friends following a four-year battle with pancreatic cancer. jimmy kayne died at 87 cayne was a renowned bridge player he was the first wall street executive to be worth $1 billion. the football world is remembering john mad en, the coach/broadcaster died yesterday at the age of 85 he won a super bowl in 1977 as coach of the oakland raiders

then turned to broadcasting for three decade and gained a new generation of fans with his madden nfl video game which he helped develop tributes, joe, have been pouring in overnight after that trinfect of passings. note harry reid has been remembered as a shrewd widely tactician, not charismatic he helped shepherd $787 billion in stimulus after the financial crisis, worked with george w. bush for the emergency bank bailout. during the crisis, but also perhaps most consequence usually he spear heeded the rule change for that simple majority now needed to approve government nominees. >> yeah, there was, you know, a along with some of the other things about madden as well.

and i always hear these things first from my son. i always know it's coming. my daughter, betty white september something out, oh my god, my heart stopped, it was just about her 12000th birthday. when i see clint's name or senatener, every year when you see the list, it drives home the point we're all just visiting. >> yes >> all right coming up. >> betty white said the key to turning 100 was to not eat anything green that's why she was trending. >> just smoke things that are green. >> i'll try it >> thank you lawmakers looking to crack down on big tech it might be one of the few issues that can bring republicanandecrs s d moat together we will talk about the potential for a crackdown next for a crackdown next

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. welcome back to "squawk box. the futures right now have turned negative and barely seeing bitcoin a flash on a little bug below 47,000 now, so there it is 46, 7.

see what the new year brings meanwhile, 2021 saw congress that ill to make substantial changes to regulate big tech what about 2022? will that be the year that these companies face some regulation joining us now kevin o'leary, adventure capitalist, cnbc contributor a. lot of times doesn't wear pants during these sits and jonathan glean blat, anti-defamation leak i don't know whether you can unsee that image or not. author of the upcoming books it could happen here. maybe that's where regulations should start, where pants wearing is mandatory will this be the year, jonathan, for not that regulation but on a more serious note for big tech >> yeah. kevin's wardrobe aside, i think the reality is, is that we do have as you said it before the

break, republicans and democrats, conservatives and liberals are looking at some of the access of social media, thinking about how do they protect consumers? i do think there will is a high likely we will see some regulation ahead president trump and president biden agree congress has too much power i think americans want to see the companies employ simple principles, like decency, accountability, transparency the reality is i came from silicon valley i worked in business many, many years. i believe in self regulation joe, as we talked about on your show before, it simply isn't working here the companies continue to enflame, excuse me inflame content. they're immune from liability because of a loophole in the law. they cut off researchers who try to look basically at what's

happening underneath the hood to understand how their algorithms work frankly, they don't exercise the same responsibility that other companies across the economy do. so i do think it's time. there are legislation we can talk about if you like i think it's on the deck that may solve this once and for all. >> i talk about a lot of things. wild, wild west, when there wasn't a sheriff around, man, there is stuff that happens. i'm thinking about what's going on in some of the cities now if you don't enforce broken windows human nature cakes us to some bad places why is tech anything are there decent guard rails it's called the market i

understand that these hearings are great political theater. they have gone on a very long time yet there is no policy consumers don't care it's a great topic to talk about a. majority of consumers use social media responsibly for those that believe it is harming children maybe parenting would be a good idea in this country, the big parent doesn't decide how many hours of social media we get. we do. we, the people, do when platforms don't work, they get eliminated by the market the best regulator in the world is the market. there are so many technology platforms that have disappeared because they haven't really stood up against the market and time and so there wasn't any tiktok, just a few years ago now it's a huge behemoth it's changed the behavior of instagram, because they want to compete. consumers like tiktok. the algorithms there work the

majority of the time you can't police it all n. our society, we have freedom of teach and a hundred a tick fringe the cost of freedom is the hundred a tick fringe. it has been around forever and always will be we will have more political theater, these politician, they have to raise money. the best sound byte you can get is bashing a social media company on behalf of children. does anything happen >> no. it won't happen next year or the year of that because we as a society and as a country as an economy want to be the leaders in technology world wide that means freedom freedom to development freedom to seven freedom to provide products. that's how -- if you don't like it here, i don't see many american families flying to beijing so that the big leader there can tell you how many hours you can watch and what social media you can actually participate in we like freedom in this country.

we always have and we always will >> jonathan, are you sure you know when the slippery slope when you've gone too far how do we know we always overshoot. i see what kevin is saying i see it already with big tech in certain respects where it infuriates me the decisions some of these people are making for what i get to see already. if they took your advice, you know, like kevin says, can i take it. i don't like what people say on twitter about me but i can take it. >> well, i would frame it probably a little differently. i really respect you kevin as an investor and shark tank judge but not as an economic historian. i think joe said when he talked about guardrails, think of the automotive companies, kevin. more many years, people used their cars from they were enforced by the government to install seatbelts. people used their cars to

install guard rails for the cars that can go off the slope. the reality is the social media companies have a monopolistic difference, because everyone needs to use their products, a duopoly of facebook and google the market isn't enough. we can draw another analogy, tobacco, you can big a pig parent but they suppressed the research about the impact of their products were having on public health and marked toward children which is why they were forced by the government to agree to a settlement to stop advertising towards children who shouldn't be using addictive products i think you would agree with that, again, unless you think they should be marked and sold to 8-year-olds by the same token, i don't think it's too much to ask that facebook and the other big tech companies simply exercise a degree of responsible. if they won't do it, if they are unable to police themselves, it forces the government to step in and so again, whether it was

seatbelts on cars or restricting at cigarette advertising to children, i think there is lots of precedent for the government showing sometimes, sometimes, maybe the market isn't enough. and that's why, by the way, kevin, we've done the polling at adl, nearly 80% of consumers want the government to get in and engaged in regular social media. whether it's because they are suppression conservative spaech to some belief whether they are promoting anti-semitic conspiracy theories or amplifying the worse kind of content. big tobacco, why can't they do it for tech giants why not? >> don't forget purdue pharma. if you didn't regulate tech, wait a minute, fda actually, the wheels that's the only problem there. you can't always count on regulators no do ato do a good b

>> i like the example jonathan brought forward. the reason the market moved with seatbelts is people watched themself dieing in cars that didn't have them the same with gashed rails at the end of the day if you smoke, let's take the smoke example, you are an idiot. everybody knows the health reasons you shouldn't smoke for. yet, we don't ban smoking altogether why? don't let me be a skeptic on this billions of dollars of texass. people want to smoke, hurt themselves doing so it it's their freedom to do so and they do it. now, if we really thought that we should ban tokbacco. we should do that. everything has a cost. the market isn't perfect but it's better than anything else and the market regulates most things very, very well the one thing you got to be careful of as we go into these hearings again, when you try to regulate advanced technology, it's virtually impossible. because it moves so quickly.

the competitive edge america has is the innovation here is unprecedented and, yes, it has a cost sometimes you don't like the outcomes but overall, is there a better economy anywhere on earth? no, there isn't. i don't think we should try to change it. the last thought is, hi, i'm from the government and i'm here to help you. that is not an american phrase it's a bad idea. >> whether it's good policy or not to regulate these companies, i think we can all agree in an election year as next year is, it's probably unlikely that any sort of bipartisan agreement could be reached but that's not going to stop europe from going forward with what it has on the table, the european union has been adamant by the second half of next year, the digital market and digital service act will likely take effect that would keep companies like facebook to selling data to other companies, other subsidiaries, it would keep apple and amazon from search results. when you think of regulation

from an investing perspective, this is not some far off possibility. in europe, it could have an impact on the company's bottom line starting in the third quarter of next year so how do you invest in that >> you have to realize and again keeping a good skeptical eye opened, there is no base in europe there is a huge tax base they don't get to apply what they do is they constantly litigate companies like the american tech companies for their piece of the pie they simply litigate them into court. these things get challenged for decades. they eventually set him on what would have been taxes had they had their own technology sect orm. they don't so they litigate everybody else's there is not a lot of litigation in europe. it reflects in a slower gdp growth it's more of a socialist society and has some benefits, on that basis to support 'social net when it comes to technology and investing in gdp growth. >> investing in large u.s.

technologies in a time when there could be a real issue for its european revenue and profit segments, i'm talking about the u.s. companies facing that challenge next year. >> yes, of course. they'll all face that challenge. >> going forward >> i get it. the likelihood of it passed the way it is proposed now is not going to be the case the european consumer likes their social media so i think some kind of excise in the middle. but at the end of the day, innovation is what drives commission, grows gdp, creates jobs, all this talk of regulation, while it's great political theater, like i said, is always going to continue to happen politicians have to get sound bytes. they have to spend 38% of their time raising money that's our system. i get it they're outrageous once. that's how it works. >> kevin, i don't know what to say. i don't think alcohol should be marked toward children i don't think cigarettes should be marketed towards children i don't think instagram should

be marketed towards children that's bake. as a parent who watches what his kids do i say that in all honesty. the reality is we've seen this in other industries. it's not going to restrict the market to make sure extremists can't organize insurrections on these platforms, because they're immune from any liability. it's not going to hurt innovation to make sure companies share their research so we know the public health impact of their products it's not going to hurt innovation in anyway or the american gdp if we make sure these companies exercise the same accountability that all other companies do i don't understand the logic here it's not like technology is somehow immune from bake principles like decency and tolerance and i'm telling you this as the guy who runs the largest anti-hate group in the world. we have seen the impact of facebook specifically in pro moeth anti-semitism and racism

because they don't have the same guidelines that cnbc or any other media company does so all we would talk about here, kevin, is the kind of parody because without that kind of parody, this common sense principles just don't apply. so that's all we're talking about here i'm surprised that you as a part would somehow be opposed to this. >> jonathan, you are living proof that our system work you have your right. you use the media to spread your pin. it's your freedom to do that i have the same. if i slander you on shall show >> we have a system. slander me and -- >> but can't do that on facebook, kevin because of section 230. if i incited violence against you on this program, you can sue me, but you can't do that on facebook, kevin. they're immune. >> if people didn't like what facebook does, and i know you've

been a vocal critic of facebook, facebook would go away as a product. the fact is that facebook has not diminished at all. the reason is consumers like it. small businesses use it. we talked about "shark tank. it used facebook a lot all my companies use it to -- this would not spend a time there if it didn't work. it represents 58% of every dollar we spent is spend on facebook it's a good product. it serves a good need. they go back to their constituents and say, no, let's not shut down facebook we use it to run our businesses, support or family, field our children if it didn't work, it would be replaced. >> again, it's addictive, kevin. it's an addictive product. it does work watch "the social dilemma.

read any of the research it's all out there. >> i know. after all that information is put forward to consumers, they don't stop using facebook, which is wouldn't stock of facebook, which is mentioned every day by investors' decisions, continue to perform i'm going to go back to the past and determine what happens in the future what's going to happen after all of these hearings? nothing, because the consumer doesn't care sorry, that's just the market. >> i don't agree with you, but we'll see. we'll see. we'll have to leave it there. the question remains, after all that -- that was a good discussion, but i'm still wondering, are you going to tweet this out, oleary what are we going to see >> i think you'll see some spectacular japanese fishing pants. that's what i think you'll see a whole new set for this series. >> okay, that's better that's good. that's better than what i was worried about.

thank you, guys. happy new year. whew, that is a relief will 2022 be the year of the met 'verse w so, you may want to put money toork in that sector we'll talk about investment opportunities, coming up next. (soft music)

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roughly half of respondents said there are real opportunities in investing in the metaverse right now. here to talk about it is serat sethi, and rohet conkarney approach this a couple ways, serat. there will be suppliers to what we call the metaverse. they supply other big ideas, too, whether it's a.i., virtual reality, whatever you want to look at, the cloud do you look at it that way or fully embrace metaverse-specific companies? >> i think you do it as to who is going to be important to the infrastructure of the metaverse.

you start with that. a company that comes to mind is nvidia they're going to be around for a long time. when you're picking nvidia, you're not picking who the winners will be. secondly, who actually hat a lead on this the obvious ones that come to mind of rho box. they already have a lead and there's facebook that's spending billions to create their own metaverse. they have oculus with it maybe some other players win, appeared that kind of is playing an option value. if you put some of them together, you create a portfolio, it's evolving, and as more and more players get into it, this wall garden needs to be open up, and as we get more into

it, the winner will come out >> i'm still not on facebook i don't like social media. i'm not willing to jump all over this i'm feeling very ludite-ish about it do i try to approach it like sarat said, let's do the infrastructure, in case it's not quite as big as people thing i don't want to play golf on a screen i look going outside, like being in -- not having an avatar i like being me again, all good points i totally groo you don't need to embrace metaverse as in facebook straight up, just for the sake

of how metaverse would einvestment over time. i gaming feels like the most natural one, but as the metaverse, and as the adoption of virtual reality, augmented reality across the entire ecosystem of kept creators, and monetization partners, across all these three ecosim constituency it is start to develop up, there will be appears in gaming, fitness, maybe commerce, and finally collaboration, and things like that all these things are probably long-term bets, but you could probably see early winners emerge the most i would call out is snap i think snap is a leader in augmented reality. i feel that's the one we should follow more closely.

>> very good. >> on the coattails of metaverse. thank you both we're out of time, but not a whole lot going on i will never guy a piece of gucci clothing for mire avatar, and i'm not buying oceanfront property on the computer. >> are you even do doing that for your real self >> yes, i have gucci loafers on. >> okay. see you soon. happy new year "squawk on the street" is next good wednesday morning, welcome to "squawk on the street." i'm here with scott wapner and leslie picker. the dow -- another gain today would be the first six-day win since march,