shortage and supply chain chaos. it's january 3, 2022, and this is "squawk box." begins right now good morning, everybody. and welcome to 2022. this is "squawk box" right here on cnbc. i'm becky quick along with andrew ross sorkin and mike santoli, joe is off today. good morning, gentlemen. great to see you both. >> happy, happy new year for the first real time we can say that in the new year. >> right for the first trading day of the new year at least we start with a recap of the markets from 2021 after the major indices turned in the third positive year in a row these were not minor advances the dow was up by 18.7%.

the s&p 500 was up by almost 27% and the nasdaq was up by 21.4% you had the russell 2000 that underperformed the broader markets but still finished higher by 13.7%. and the dow transports were the outperformer up by 31.75%. the best year for the dow transports since 2013. you should check out crude oil prices up last year by 55% and up this morning 1% we should point out that opec is meeting today and tomorrow tomorrow is the big day when they'll be deciding what they'll do in terms of supply. we'll have more on that later this morning while there were green arrows just about everywhere across the board you saw gold decline last year, the worst year since 2015. down again to $1,827 an ounce. here's how we're setting up for the first trading day of the

year you have u.s. equity futures in the green, sharply again dow indicated up 212 points, s&p up by 31 and the nasdaq is the big performer here, it's indicated up by 121 points treasury yields we finally got last week to the point we were back above 1.5% for the ten year, the goal we've been playing with all year waiting to see what happened we got above 1.5% right now the ten year yielding 1.536% >> tesla announcing yesterday it delivered 308,000 electric vehicles in the fourth quarter beating estimates and its own records as well. that brings deliveries to 986,000 thousand for the year. we'll talk about what those numbers mean for tesla at 6:30, although the shares are starting the session higher >> the numbers are amazing

it's nice to see them releasing them right at the beginning of the new year, i think to make a point. we'll talk about that in a second the surge in covid cases it continues with cases up more than 200% in the last two weeks alone. meg tirrell joins us i was out of the country last week, flew into newark, and i thought i am flying into the center of the storm all over again. >> reporter: yeah. you talked about the numbers being amazing. these are just incredible, andrew when you look at the case numbers we've surpassed 400,000 on the daily average in the u.s. now, and we have that omicron signature spike straight up. but while cases are just unbelievable, and that's likely a drastic undercount because there's not enough testing, a, and people are getting rapid tests, b, and it's difficult to report those to state health departments. but the hospitalizations and

deaths are not the same. there's about 12,000 people going into the hospital every day right now in the u.s about 100,000 currently hospitalized total that is going up, you can see that, but it's not going up at the rate that cases are. deaths have remained about 1,200 per day. so really steady right now there is, of course, a warning, though, that with this many cases, hospitals still could become overwhelmed experts have been looking to south africa and the uk in particular as signs of what might be to come in the united states we have seen south africa's cases go up there at a peak higher than they saw for their delta wave but come down rapidly over a course of four to six weeks. and deaths there have not followed anywhere close to the level we saw with the delta peak in south africa. there are reasons for optimism but folks like dr. fauci still warning the health care system could come under a tremendous strain and already is. we look at cases, not just because of cases themselves but

because this affects the economy. a lot of folks are out you were talking about the flights cancelled. dr. fauci was talking yesterday on the sunday shows about that new guidance from the cdc. five-day isolation time, got a lot of push back because there was no testing at the end of it. here's what he told them >> you're right there has been some concern about why we don't ask people at the five-day period to get tested that is something that is now under consideration, the cdc is very well aware that there has been some pushback about that. looking at it again, there may be an option in that that testing could be a part of that. i think we're going to be hearing more about that in the next day or so from the cdc. >> reporter: he said the same thing on cnn so we could be hearing about a change potentially to this five-day guidance, which would affect a lot of folks guys. so we'll be listening closely to hear about that. back to you.

>> in terms of what you're hearing behind the scenes and what the cdc may or may not do and their own credibility on this if they turn around and say they made a mistake, give them credit for acknowledging the mistake, but at the same time the question is how they would have made the mistake in the first place and how much of it was pushed, frankly, by industry >> well, that's an interesting question, andrew, i don't have any reporting on how much was pushed by industry typically we've seen a lot of criticism of the cdc for what appears to be changing course. but in the past there has always been science behind that with the mask dguidance, for example, they did it with alpha as the variant and with delta it changed. this is a situation they put out guidance, tremendous public health push back and now they're changing course, it's not clear the science changed so it's not

clear why the guidance came out. >> that's the question they've been cautious throughout, some people argue too cautious in some cases here was a situation they went in the opposite direction where the scientific community was not on their side from the get o trying to figure out how that happened obviously the airlines were public in terms of their perspective, saying five days is what they were asking for and you had delta testing out and the like, and people in the health care community saying there's not going to be enough employees, but how much do we think was based in science, do we have any reporting behind the scenes about how they came to the decision the first time around >> well, from what they've said, there was science behind it, that the vast majority of transmission does happen within the first five days of symptoms, or, of course, infection but we've seen so much information about people showing they have rapid positive tests beyond five days so there's concern about this. i think the cdc is trying to

balance keeping the economy running and keeping health care workers in their jobs, et cetera, with the science but there was so much pushback. >> do you believe the testing issue, the resource issue, one thing was the cdc pushed back on the idea there's not enough rapid tests out there. one of the main problems is if you're at day five and don't have access to a quick rapid test, that makes testing out that much harder and how much of the decision might have been driven by that, if they change the -- their position, how people are actually going to get access to the rapid tests because i sit on walmart.com and get a test and they don't exist. >> i think the price might have gone up. that's a key problem and probably something the cdc took into consideration. there aren't easy answers here but it's just so interesting to see after only a few days of this guidance being out that it's potentially being changed didn't sound like it was

necessarily set in stone it was going to require testing seemed like there was going to be an acknowledgement that testing could be a part of this. we have to see where it ends up. >> meg, this has all played out so quickly and added so much confusion to what's happening. the cdc does realize that businesses, schools, all kinds of other places, build their decisions around what the cdc says it's a big -- you know, the cdc is the cya, if you're not doing what they're saying, you're taking a risk. >> reporter: absolutely. and i think there's a lot of confusion among schools and school nurses and administrators, and folks, you know, sending their kids back right now trying to figure out is it ten days, five days? are we testing so there's a lot of confusion and schools and industries are all looking to the cdc for the guidance there was such public health pushback to this it sounds like there might be a change but a

change after everyone is gearing back up to go to society after the holidays so sounds like we'll hear about it soon. >> thank you for helping us try to make sense of stuff that doesn't seem to always make sense. appreciate it. becky. let's get an update on the travel nightmare in the united states the airlines have cancelled more than 15,000 flights since christmas eve, including an additional 5,300 this past weekend. the carriers blamed a rise in covid infection among the crews and storms that forced cancellations at chicago's two main airports on saturday. already this morning 1,700 flights in the united states have been cancelled according to flight ware. i it's only 6:10 in the morning. watching this, there's nowhere i want to go badly enough for the potential being caught in these

snarls, caught at the airport forever, watching the lines they're dealing with this is a horrible situation i have plans for spring break, plan on going, but i was timing it out to see how long it would take me to drive, the answer is 19.5 hours, but i still might drive rather than risk not being able to get there. >> i think we're all hoping the thing moves quickly enough and peaks in a dramatic way that by spring this will all be in the rear view, let's hope. furthers pointing to a positive open to kick off the new year and later the ceo of ww, formerly known as weight watchers will join us as the company plans for a wellness push to start the new year that stock was down 24% in 2021. "squawk box" will be right back.

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on this week's agenda it's jobs week. tomorrow we get the latest jolt report which shows the gap between job openers and seekers, the last 3.6 million more job openings than people looking for work we get adp payroll on wednesday, jobless claims on thursday, and the employment report on friday. the survey was conducted in p mid december before the rapid rise in covid cases tied to the omicron variant. it's expected to show a ramp up in hiring.

on this week's earnings calendar we hear from bed, bath and beyond, walgreens, constellation greens let's check the markets with kerry firestone, cnbc contributor and gungant bannaji. good morning and happy new year to you both. kerry, let's set up the year here, 2021 economic growth, earnings higher than expected. stock prices probably went up more than people were thinking seems like we're expecting kind of moderation from all those things across the board. from your perspective as you reassess your portfolio what does that mean for where you'd like to be investing >> hi. happy new year to you, too 27% gain in 2021 i mean, that's pretty amazing considering the fears that investors seemed to be dealing

with with covid, interest rates and inflation. obviously they looked beyond that and as we know, the addage, the market trend is your friend is applicable and usually is true trend means going higher, it's like the weather, what happened yesterday is more likely to happen today than anything else. but it's also very unlikely that you have five participants in the s&p, apple, microsoft, google, tesla and nvidia, that contributed to 30% of the gain in the s&p, that's amazing compared to the broader index. that's what we think is unlikely to reoccur this year 27%, of course, that's highly unlikely but that domination by the big names that were really agnostic to whether there was covid or not is something that is very unusual. we think the broader market will have more appeal we believe there's these rolling corrections that happened all

year, you realize there are 250 million names in market cap down from their 2021 peek if you look at biontech, small caps, the spacs a lot of the high multiple on sales type of numbers that are in the arc portfolio, whether it's crowdstrike or peloton and zoom, you can go on and on with those names that are down 25 to 70%. so there are opportunities among that record and it doesn't mean you go with the same names that are outperformed this year past year. last year. >> sure. that's right we all have to get used to that. just to that point, if you look at just the one year chart of the s&p 500, it looks like this smooth ride, but really there were these boom/bust cycles under the surface when it comes to the speculative growth stocks that surged and crashed as well

as the retail trader activity. i know you track this in terms of how much there was in the way of aggressive options trading. and it did seem to moderate throughout the course of the year, i wonder what you think, whether that's going to be a source of energy again this year or did we see the peak >> mike, that's a really good point. i think that was a key shift in markets in 2021. right. retail dominance they kind of cemented their dominance in markets and money managers i was speaking to said they're tracking those flows more than ever before. options trading at times caused fireworks across the markets we saw the huge one day move in single stocks and the crazy thing it wasn't just meme stocks it was nvidia and tesla, tesla in december jumped $200 million in market values in days if it's premarket activity today up 7% is any indication we might see more of that this year, that's the key thing to watch.

what does that single stock volatility look like underneath the broader indexes? >> 7% in a, you know, trillion dollar plus company is real money for a pre-market move on the first trading day of the year kari, if you don't think you're going to see perhaps the same type of dominance from the consensus winners we saw last year, what themes do you think are maybe underappreciated at this point going into -- you know, as we get going in 2022? >> i think that there are groups that have suffered the payment processers, for example, visa is a name that had a terrible year, paypal did also but i can see them coming back look at a name like autodesk steady growth technology not at the top of the list of many buyers of hot stocks that's attractive. amazon had a tough year last year after a strong 2020 we would buy that name here. unh, they're health care

names -- health care was really abysmal last year, unh was decent, some industrials like forive i think financials, black stone and swab are two names like we like you can find names that are not ridiculous multiples and perhaps benefit from higher interest rates. >> you mentioned that money managers feel compelled, they have to track what's going on in terms of retail activity, even in m some of the larger stocks would it be your sense that professionals are using that as a leading indicator, as a risk management tool, as something to bet against? i'm sure the answer is all the above. but i just wonder how that orientation might have evolved recently. >> i think it is partly all the above. and partly what i've been hearing is that, hey, we're paying attention to this more than ever but also still trying

to make sense of it all. we saw so many themes in many 2021 kind of explode and they were new to these professional money managers, tracking on social media, tracking retail fund flows, it's still pretty new to them. it was new to all of us, it was new to many of the retail investors. so everyone is trying to figure out how to go about that. >> we're all trying to figure it out for sure thanks very much for starting off the year for us. >> thank you >> thanks, mike. >> and as we start off the year, coming up when we return, the money moves you should consider in this new year we'll talk about it next and later, mohamed el-erian is going to give us his take in 2022 get your note pad out. "squawk box" returns right after this

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welcome back to "squawk box" this morning new york -- new year opportunities for so many americans, in their careers and financial lives. gregory shuffle expected to continue as employees leave their jobs and take new ones at a rapid clip sharon epperson joins us now on what workers are seeing and how they can grow their saving in the new year sharon, good morning >> reporter: good morning, andrew happy 2022 making a new year's resolution to save more is often a top financial goal yet many americans admit they're not sure they can stick to it. some financial advisers say don't overcomplicate your plan. >> try to simplify your investments and financial life that's especially important with so many people now changing jobs during the pandemic.

it's a good opportunity to reset and simplify some things >> reporter: so reset your retirement savings goal with this in mind keep in mind that in 2022, employees can contribute $1,000 more than last year to a 401(k), or work place retirement savings plan up to $20,500. the if you're 50 or older you can add a catch-up contribution up to $6,500 the dilemma is to put it in a pretax or after tax 401(k) >> they may recommend you put all in a roth, particularly if you are in a lower income tax bracket and the tax savings is not really important to you right now. if you're in a higher income bracket, perhaps having some pretax savings could be beneficial >> reporter: either way review

your automatic contributions, increase your overall rate by say 1 or 2%. try to at least get your company's matching contribution, even if you can't fully fund the account. rebalance the investments so your portfolio is not taking on more or less risk than you're willing or need to take. some advisers recommend a retirement saving in a retirement date fund that shifts from stocks to bonds as you get closer to the date you need the money. we have more information on the financial moves you need to make right now on cnbc.com/investinyou >> question, what should do you with your old 401(k) when you start a new job? >> now, thankfully a lot of people are starting the new year with a new job what you need to keep in mind is you can keep that 401k money with your former employer, but you may want to move it, consider moving it to a new

401(k) with a new employer or ira depending on the options you don't want to cash it out because you likely face a significant tax and pay a penalty depending on your age. >> what about saving in an ira, are there changes for 2022 you need to know about >> yeah, a lot of folks want to save on their own in an ira, that's a smart move to make. the amount of money you can contribute is the same in 2022 as it was in 2021. $6,000 or 7,000 if you're 50 or older. but if you didn't make an ira contribution in 2021 or you didn't max out, you still have until the tax filing deadline in april of this year to do that. and have it count for last year. and then you can also make a contribution for 2022. so if you're 50 or older, you could potentially put up to $14,000 into an ira this year, giving a major boost to your top financial resolution, which is saving more in the new year.

andrew >> absolutely. one last one there's a timing issue i know some people who like to time it and -- in terms of the ira, they try to make the investment at the beginning of the year, some people who try to consistently put in a little bit throughout the year and some people who try to do it after the year is over, almost not looking back but once they know where things stand what they're doing. what's your take >> reporter: well, you know a lot of advisers say dollar cost averaging, doing a little over time is a great discipline to have but it comes up to everyone's financial situation and when they have the money to put in. if you can do it consistently you have the discipline and can increase that amount too if possible, that's a great rule of thumb. then again, the money comes in when it comes in so if you have it and can put it in now at the start of the year and have that money continue to grow, that's a great idea as well >> sharon, i want to go back to

the roth ira, because i was looking at an old 401(k) that i had from a different employer and thinking of putting it into a roth ira there's a lot to keep in mind. these roth iras are now targets, you should warned with congress. they're eyeing these things so there could be tax changes that make it more likely you get double taxed on these things down the road. you should remember that with a 401(k) you don't have to start taking money out until 70.5 and think will you be at a higher tax bracket then than now, if you think you'll be lower, it doesn't make sense to drop it into a roth ira. if you move, livering in a chear place, you would be in a lower tax bracket too. there's a lot to consider. roth ira has a great reputation but it's not necessarily right

for everybody. >> reporter: it may not be right for everybody, becky but here's the thing i love about roth accounts. talking about a roth 401(k) or ira, when people look at their nest egg and retirement savings, they see a number and think that's the number they have to retire on. for most people the majority of money is in a traditional account that's going to be taxed at their ordinary income rate. regardless of what the rate is when you retire, with a roth account you're not paying any taxes, the number you see for your nest egg is your nest egg and the government doesn't get any part of that that's what i love about the roth account it's a great idea to have a mix of traditional and roth money for your retirement savings and investments, but it is something to keep in mind that the tax hit is something you want to consider >> just so it is also in the cross hairs from congress that could change the rules on it, as they have done in the past that's the only thing that makes you nervous about it, if you pay

your taxes now and think you're getting everything out of the way, there could be changes down the road the government has never stopped from double taxation in the past, that's the only thing i say look out on that front great to see you, happy new year, sharon. >> great to see you, too happy new year. >> we look forward to having you back here soon talk to you later. >> take care. >> you too when we come back, tesla shares surging after the company surprised analysts with a big beat on deliveries phil lebeau is going to join us and talk more about what to think of the deliveries and where you see the stock now it's up about 7.6%. t-mobile is bringing it all together for the holidays. upgrade to the iphone 13 pro on us. plus get a free year of apple tv plus. only at t-mobile.

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good morning, everybody. welcome back to "squawk box" here on cnbc and on this first trading day of the new year, you'll look at some green arrows when you check futures this morning dow futures indicated up almost 200 points right now with s&p indicated up by about 32 nasdaq is indicated up by 133. so the nasdaq looks like the relative outperformer in terms of a percentage basis. andrew >> we are also watching shares of tesla this morning.

the company reporting a record number of deliveries in the fourth quarter and beat estimates for the full year. phil lebeau joins us on this first work day of 2022 phil >> reporter: andrew, reading through some of the analysts notes coming in early this morning, look for almost all the analysts to raise their estimates for the fourth quarter and for 2022 when you look at the numbers for what tesla reported in the fourth quarter, far beyond what people are expecting, 308,600 vehicles the estimate for was 267 the most optimistic analysts expectation i saw was 295. so they surpassed all of that for the year well above expectations, delivering 936,132 vehicles. by the way, almost all of those vehicles were model 3s and model ys, as you look at the annual deliveries, the chart says it all, they are knocking on the door of surpassing 1 million in annual deliveries up 87% year

over year compared to 2020 they are targeting 50% annual delivery growth. by the way, the analysts consensus right now is for 2022 deliveries to be 1.3 million, expect that to go up today or the next couple of days. they have the texas factory, that's expected to come on line any day now and potentially start deliveries in the first quarter. also expecting the same thing with berlin, though it's a little bit behind texas but deliveries are expected to start in the first quarter or early second quarter and for tesla investors, they're looking at the stock saying what can we expect from elon musk during the fourth quarter earnings call, later this month, maybe early february, we haven't gotten the exact date yet. what we should be hearing from him, what he has intimated, we will hear about future products. does this mean new vehicles they plan to roll out over the, let's say, three to four years

do we get better clarity regarding the cyber truck which goes into production in texas late this year with deliveries starting early next year lots of questions to be focused on when they have the conference call later this month. but we will see the analysts' expectations for the fourth quarter numbers as well as for 2022 to go up. >> the chart is something to behold, not the stock chart but the delivery chart. >> right the delivery one >> when you think about 2022, and this has been the -- i guess the bear argument for the last several years is there's going to be competition, there's going to be competition. >> reporter: yes. >> volkswagen showing up with evs, gm is doing it, everybody is doing it. but they haven't been doing it and haven't been able to deliver. the question is, what's in 2022? >> reporter: i think that tesla still has the strong advantage they have the first mover advantage. they are the brand when it comes to electric vehicles i know already people are saying what about volkswagen in europe?

yes, they're making enroads in europe, but keep in mind the berlin factory hasn't started there yet. very strong in china so tesla is in a good position and yes, competition is coming generally speaking with the exception of people who say i can't wait to see the f-150 lightning, which is an electric pickup truck generally speaking when you talk to people and they say i'm interested in an electric vehicle, they're interested in a tesla. doesn't mean that tesla is the only game in town but for right now the advantage is similar to what you saw with prius when the hybrids came out in the late '90s you never heard anybody say i'm thinking of getting a hybrid vehicle from a different automakers, it's the prius it's the similar situation with tesla when it comes to electric

vehicles. >> phil lebeau great to see you. happy new year. >> happy new year. becks? >> thanks, andrew. when we come back, the ceo of ww, the company formerly known as weight watchers will join us to talk about the wellness push for the new year and the impact in the rise of covid cases and later dr. scott gottlieb tells us when he expects cases to peak this winter. a reminder, you can watch or listen to us live any time on e bcppthcn a 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

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welcome back, everybody. the start of the year is typically make or break time for health and finance companies but will the surge in covid cases derail that or help it out

for that, let's bring in cindy grossman, the ceo of ww. it's always great to see you i did read something the other day that fewer people are making new year's resolutions this year is that true >> i think it's less first of all, happy new year, it's great to be here. great to be ringing the bell to kick off wellness week i think it's less about resolutions and more reality we recently conducted a survey along with cantar to get a sense of where people are, especially given the rise of cases that we're seeing and people are really prioritizing their health. so it's less about a momentary resolution and more about how do i get healthy and weight loss and other elements of health is porntd to that it's not what my body looks

like, it's how i feel and how i can make sure i'm living my healthiest life. our new innovation that we just launched, personal point, is actually so well timed because it is ultimately livable, gives people tools, gives them a program, our newest innovation and probably most revolutionary innovation in the company's history. and it's really a trifecta of capabilities for people around personalization, around motivation and around algorithms that are going to give them the tools to be able to achieve what they want their health goals to be >> i can certainly relate to that i don't have any new year's resolutions this year but it doesn't mean i'm not watching my steps every day and think about what i'm doing for a more healthy way of living just in general. but trying to convince people of this and convincing them to buy the programs is pretty tough

your stock was down about 34% last year, over 30% decline. and part of that is because there are just questions about whether people are going to stick with this, whether they are going to be brought in, whether the digital way of doing it is going to be as period of timable is going to be as profitable to the old way. what do you say to people who sold stock last year >> no doubt there were challenges over last year. if you think about it, the team did an incredible job of pivoting our business once covid happened to now 90% of our business is digital, and we've been able to grow our digital business, our engagement and retention is at an all-time high and with the launch of this innovation we're seeing incredible excitement amongst our members and overall. and this message that we're trying to give to people of

living the life you love and certainly losing the weight you want, but this idea of overall wellness is really resonating. and, you know, a lot that we've done to resize our physical studio business, our move to virtual, our ability to engage with particularly this new innovation, what we've also been able to do is increase our retention. we have gross margins now over 60% and that's been consistent so we're positioned for growth in 2022 and beyond and a lot of the work that we've done over the past year has really set ourselves up to be able to do that. >> a lot of those programs are less expensive than the old programs where you used to have counselors and see people in person you mentioned the 60% gross margins, north of 60% gross

margins, which is great. but is revenue going to be able to recover and get back to higher levels or does it matter talking about gross margins that are better than before >> everything matters. and our goal is to go into 2022 with positive growth across all elements of the business but to your point, there's been a big shift, and that shift obviously is positive to margin. but we will continue to look for recruitment, we launched a new membership vertical last year, which is still in growth phase, d-360. where we've been able to integrate this combination of content, community, and coaching and that will continue to be a big part of our future we will never give up the community aspect of who we are, and what we do it's integral to everything that

this brand has stood for for almost 60 years. and in today's environment, you can see it across every business vertical, community is more important than ever. and it's a core component of who we are and what we do, whether it's in our digital business, our virtual studios or where we're operating our physical studios. >> mindy, the brand has been around for 60 years but honestly it's hard for me to think of ww without thinking of you. you've been such a big part of the changes at the company this is your last quarter with the company. why are you leaving, and what comes next for you >> well, thank you, becky. look, i will always be a part of this company as a member, as an advocate, as an ambassador it's not just been a role. but when i joined the company four years ago, it was really about transforming weight

watchers, this brand who's had an impact on people's lives for so many years, but modernizing it and giving it a new relevance in a modern world. and what we've done over that time is we are now ww. we are we are a transformative technology company, we're still human-centric, where the leading digital weight and wellness subscription platform and that inherently is all of the work that we've done around the re-branding to democratize wellness, and i'm really proud of what we've been able to accomplish in growing our member base, in being able to pivot through this entire covid environment, and position ourselves for 2022 and beyond, and i'm working closely with the

board to ensure a very smooth succession, and have a successful winter season and be able to come back and talk about the future in the new year >> well, we look forward to that conversation, mindy and again, thank you for your time. happy new year and we will see you soon >> happy new year and let's all stay well and healthy. >> i'm all in favor of that. here here. we're going to be getting another read on the fitness industry coming up in the 8:00 hour, when we'll be speaking with the ceo of planet fitness coming up, stocks may be impacted by fed rate hikes in 2022 up next, one importanthi tng that could offset the fed's actions. "squawk box" will be right back. for nutrition, sleep, immune systems and energy, cvs can help them happen a little less.

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with the fed likely to raise rates this year there's some concern how stocks will fare steve liesman joins with us a

look at something that could significantly offset the fed's actions. steve? >> mike, good morning and happy new year federal reserve hikes, inflation weighing on the impact for equities stocks essentially have a built in hedge as inflation rises so, too, do corporate revenues pumping companies full of cash wharton professor jeremy spiegel was on "squawk box" friday and i talked to him afterwards, he offered up this chart showing the dividends from s&p companies outplaced inflation over the long run as inflation rises, dividends go up, so do share buy-backs. he told me the long-term history earnings exhibited go up at the high level, not year over year but over the long run. the total return index shows companies are keeping pace with inflation and then some throughout the pandemic and this happened even though buy-backs and dividends have not kept pace with the increase in free cash flow so according to jonathan

g golah of credit suisse he thinks there's substantial scope of cash to increase to shareholders but more true for old line manufacturing companies rather than interestingly for technology firms, and corporate cash levels are quite bloated and if they can't use the money they generally give it back. higher dividends and risk factors won't offset everything. valuations could take a hit if the fed is forced to doing something more to contain inflation. the cash flow to corporations has been keeping pace with inflation and so too should the return of the cash to investors in 2022. >> inflation helps companies in general getting back to shareholders i wonder if the absolute level of inflation is a relevant

factor, just running around 7%, it's not always, if that were sustained it might be a different story. >> so siegel says in all inflationary environments over time it does even out. ba rah knapp is more concerned, what he says is we need inflation to come down to the 4%, 5% range both of the guys say manufacturing because they have more fixed costs than the tech companies and when the fixed costs stay the same, don't go up as much the revenues go up more and more cash to sharehoeflders. >> steve, thanks very much coming up, we have two big hours ahead. mohammad el erian has a lo aokt the biggest market risks for the next 12 months "squawk" returns in just a moment

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playbook with mohammed el erian. the number of people growing with the omicron variant growing in the united states and throughout the world the latest numbers and another change in guidance from the cdc. we've got the latest straight ahead. and what a year for elon musk, from tweets to tesla, we break down what's next for the world's richest man. second hour of "squawk box" begins right now >> good morning and welcome back to "squawk box" right here on cnbc i'm andrew ross sorkin with becky ross quick and mike santoli. u.s. equity futures at this hour, show you where things stand right now. we are looking at a morning that's going to look in the green, we'll open up about 207 points higher. nasdaq up about 128 points higher and the s&p higher 32

points higher. headlines at this hour, tesla delivers 308,600 vehicles during the fourth quarter, it's a record, well above consensus by 263,000 and coming despite the global chip shortages that crimped so much of the auto industry's production. thousands of flights canceled over the weekend as airlines battling shortages of staff and bad weather, about 2,600 u.s. flights were canceled yesterday following about 2,700 cancellations on saturday. airlines started preemptively cutting back on their schedules as well as offering financial incentives for flight crews to put in extra hours and days. "spider-man: no way home" taking in $52.7 million in domestic ticket sales comes in number one for the third straight weekend dom chu has this morning's pre-market movers. good morning >> good morning and happy new year

'tis the season for analyst teams all across wall street to give their takes on some of their top picks going into this upcoming trading year so a lot of analysts says this is our best idea. we'll highlight a few this morning. semiconductors a big market discussion leading indicator possibly and certain aspects of the market for technology semiconductors the team at goldman sachs has come up with top picks, among them are these five names, advanced microdevices, marvell technology and micron, some names could benefit from data center, artificial intelligence, machine learning, that sort of situation. those three stocks up roughly 1% in the premarket trade and qorvo well positioned in stock going forward and on semiconductor when it comes to autonomous driving and automotive in general. those chip stocks we want to focus on from goldman sachs.

the team at guggenheim called nike, they keep a buy rating on nike but say it's their cop pick, up about 1% in the premarket trade. they think nigh ecase brand positioning, top of market can help them navigate markets in the new year nike shares up about 1%, a dow component as well. keep an eye on those and one other place to watch from my standpoint, mike, because i like to do this every once in a while to throw some of my editorial in there, you know i'm a golfer, i like it but callaway golf is one of compass points top picks for 2022, the secular growth for golf could be intact they elect the top golf entertainment acquisition they believe will do well and callaway's abilities to navigate supply chain issues at pair position and seasonal weakness in the third and fourth quarter of last year that could set up good returns for this year callaway golf shares down 1% in

the premarket trade but top pick over a compass point might but just a sampling. you and i both know analysts coming out left, right and center talking about the analysts saying what their best idea is. >> the calendar rolling over is a good excuse to get in front of clients and analysts know that when it comes to callaway, dom, it's interesting, if you looked at two-year chart it was down at 7 at the depths in 2020, up to 37 it was a stealth pandemic player, right? you did have that effect of people playing more rounds and it's come off since may down to the mid-20s. >> no doubt. the game of golf overall, if you want to look at it this way. it's hard to say there was a silver lining for the pandemic overall but many aspects of certain businesses did benefit golf has seen a very strong momentum trade go through because many more have taken up the game during the pandemic, outside, socially distanced by nature a lot of that is reflected in the stock. what's curious about now is whether or not investor also

look towards how tough the comparisons will be, right, mike 2020 and 2021 were just so good for the game of golf 2022 is going to have to do a lot to replicate that growth and that kind of performance, so whether or not companies like callaway golf or titlist parent company, acushnet or talormade golf, private equity owned, whether the companies see the sales gains continue remains to be seen. >> for sure. i remember writing about it in the late '90s and that golf boom, so here we are a generation later so maybe it's kind of, been long enough that it can -- >> hopefully secular this time, mike, stays that way >> dom, thanks very much >> thanks. >> talk to you again soon. for the latest on the covid front, we're going to get over to meg tirrell the numbers keep climbing and show no real signs of backing off yet, right >> yes, becky, modeling suggests perhaps here in the epicenter of new york city, we could be getting close to a peak, so right now nationally, we're

recording more than 400,000 cases per day on average, likely to be a dramatic undercount given how difficult it is to get testing in some areas and the fact that so many people are taking rapid tests which don't get reported to health agencies. hospitalizations and deaths, though, are not following that same dramatic upward rend. hospitalizations more than 70,000 now so they are increasing and there are warnings from health experts we will see pressure and already are on hospitals, just the sheer number of people we're seeing get sick deaths have not increased. we're seeing about 1200 per day so that's a high level but it is not spiking at the moment. right now in terms of how much of this is omicron versus leftover delta, we don't have a great picture of because the cdc revised its estimates of the l prevalence of omicron leading up to christmas they estimated 59% of all variants that week we expect an update as soon as later today. we'll see where we're shaking out in terms of omicron versus

delta. but trying to model out what's going to happen with this omicron wave here in the u.s., there's been a lot of comparisons between new york, london and haoteng provence in south africa, which was their epicenter in south africa. the waves of omicron since the beginning over the days since it began, so you can see that the green line is in south africa. it peaked and came down. we've had higher numbers per capita in london and new york city new york has surpassed london but there's an expectation it could potentially peak as soon as this week, and then around the country perhaps peaking later this month and really coming to a close hopefully in february if the trends hold. now, one of the good signs in the trends comes from south af africa, where we saw that peak in cases go so high, higher than the delta wave, but the deaths have not followed. so a lot of data emerging about

the omicron variant being less severe, in epidemiological data and data biological reasons why the variant might be less severe still seeing pressure on the health care system and all the cases putting pressure on the economy as well. guys >> meg, the spikes that you were showing in london versus new york city, our spike looked different, very dramatic and much more mountainous rather than a hill like the one in london what explains that i thought we were similar to london in terms of demographics who had covid and who has been vaccinated why does ours look different more testing or is there something else >> well, there has been a question about whether there's enough testing in london you are seeing that peak and plateau there and hope they're going to start coming down of course, that funny "v" you see at the end of our peak in new york city is a figment of

testing, and so we just have more cases here per capita we've had more infection in this wave, according to these data, but there's a hope that even though ours does look more mountainous as you said, becky, that we will start to level off. it's interesting to see it laid out like that. the south africa line looks so flat if you look at it over the course of a calendar year, it's a huge spike in coming back down so it puts into perspective the magnitude of what we're seeing in new york right now. >> meg, some employers looking at the numbers trying to figure out what to do, whether to bring employees into the office and if they're not doing it now, when goldman sachs over the weekend telling its employees to actually work from home for the next two weeks when you look at these numbers, what are the experts actually saying the numbers really are? for example, in manhattan right now, if you look at the new york numbers, it's around 19% in terms of those testing positive you're saying that's an undercount, overcount?

what is the best way to even begin to measure this? >> yes, well it's likely an undercount just given what we know first about positivity, the accepting threshold is typically 5% positivity for an area to be considered doing enough testing to have a good sense of what's going on so at 20% that's lower for new york city but still means we're not doing enough testing it's almost impossible to report rapid test results to state and public health agencies so that is not getting collected, and we know there's maybe double the number of rapid tests happening than pcr tests so there's a lot of infection out there that is not getting recorded here and so we could be seeing more than 1 million cases every day in the united states right now. we don't have a great handle on it the holidays make that a lot harder from the modeling out of columbia, out of the ihme, out of texas, all of these models suggest that the u.s. is likely to peak in january and come down

through february it will be different regionally. dr. gottlieb has talked about this but hopefully it's really bald right now but it will pass quickly. >> meg tirrell thank you for breaking it down for us, appreciate it. when we come back, greycroft alan patricof joins us, why removing some key parts of the build back better plan could hinder startups. rkonheget a check t maets. "squawk box" returning after this

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>> welcome back to "squawk box." congress back in session this week with democrats hoping to make more progress on passing that build back better bill. lawmakers proposing changes to the qualified small business stock tax which provided tax breaks to founders and early investors and new ventures ourp next guest believes if the provision loses key features it will keep startups on the sideline and democratic donor alan patricov, copounder of greycroft. i'm curious about your view of the tax break. i appreciate its importance to some, including yourself, yet there was a big piece in the "new york times" which i know you read in the past week that

effectively showed how early founders and others not only use the tax break for themselves but stack it on top of each other to dole out to family members and friends and others and to some degree you can look at it and say that doesn't make sense. >> andrew, first of all, welcome to 2022. >> happy new year. >> that article was so extreme and was so isolated. i mean, i have a feeling that most of the conversations took place on the west coast, because over the weekend, i did my own mini survey with about 20 or 30 of our portfolio companies, i talked to several of my venture funds and none of them have engaged in this practice all of us, and i'm sure including yourself and anyone else who is making investments wants to make them efficiently in terms of their family and trying to do estate planning early on, you don't want to to

60 or 70 to estate planning. it's a great feature in the tax code which is legitimate talked about in that article using multiple people and spreading it so widely this technique of stacking. it's the first time i heard that word used and all the 20 i spoke to, none of them heard the word used before so i think these are some isolated cases and they mentioned companies aextreme appreciation we made over 200 investments in the last 12 or 13 years and had ten companies, excuse me, 18 companies that have benefited from qsps so it's a fraction of our companies and that use and that dollars aukd about were so different than reported. >> the question i ask you is how

important is this tax break to the investment pieces behind the investments? would the companies not be getting money otherwise? >> it's hard to say they wouldn't be getting money but it stimulated a lot of interest the first five years there was no benefit offset by the amc and up to only 50% and no one had any interest in it it was changed under obama and supported by president trump and it has taken off in terms of people stimulating startup activity look at the startups that increased the last five, six, seven years. a lot of it has to do with the qsps feature which encouraged people to put money into startups which have a high loss factor this article didn't pay attention to the fact that most companies don't get the benefits, they don't get to the point of appreciating in the

extreme that they mentioned in that article the proportion of companies that reached this benefit to take advantage of qsps is limited >> alan, i think there's, the question that's out there right now is, the world is awash in liquidity. this was a tax break for the wealthy to get wealthier i accept that some of the time people will lose money along the way. there's no question about that the question is whether these tax breaks should exist at all >> the tax break is a benefit to every single founder who takes advantage of qualifying their company. you have to hold your stock for five years certain categories that are eligible it is not just given out to anybody and it has to be original issued stock. it is not as widely deployed as

you might think, but for those young founders, more than venture capital or investors, this benefits someone who invests $1,000 or $10,000 if it's -- qsps stock, everybody who invests in those types of companies which have to be early stage companies that have raised less than $50 million before that benefit if they hold it more than five years most of our companies get sold in under five years and the ones, some of them take 10 or 12 years. i'll give you an interesting example. we sold a company on september 14th, a day after president biden proposed the new changes we had that company 11 years and a qsps qualifier, because of the change, proposed changes, that will not be qsps eligible. it's a very unfair element of going retroactively to wipe out all the people who had sat there

for years expecting they had that benefit when they made that investment >> alan, you've been an outspoken democrat for quite some time. where do you stand ultimately now on carried interest? >> andrew, i've always believed that carried interest is ordinary income. it does not make me popular and interestingly, carried interest hasn't been touched again, there's been talk about it but the focus has instead been on this element which supports investments in young startup companies. carried interest is an issue debated for so long and i don't know how it's going to be resolved there are many people who support it, treated as capital gains. i believe it's part of the ordinary income of people like myself who are engaged it shows i have a balanced view.

>> alan, i want to talk to you about two other things quickly if i can fascinating article in the "wall street journal" talks about how much liquidity is out there and because of that early stage investing is getting earlier and earlier, the amount of money flowing to young companies is this a good thing or not? >> i personally think this is a time to be extraordinarily disciplined. there's a lot of money out there that people are wantonly investing it without perhaps doing the same due diligence we are very focused for example at greycroft to be very disciplined about every element before we make a decision. before we make a follow-on decision but i read the same article you did this morning, i think there's a lot of indiscriminate investing for people who have not had

experience, not lived through the issues you and i have lived through, which is 2008, 2000, 2001 this isn't going down for surprises. >> alan, you've been outspoken about regulation for big tech. i don't know if we'll put twitter in the big tech category but boy, some news over the weekend that they are suspended now permanently, congresswoman marjorie taylor greene's account. is that the right decision >> well, we get to the 232 we're going to have to face that up in terms of what obligations all people in the media have compared to what people who are running, you know, the "new york times" and nbc and cbs, they have certain restrictions, and there are a lot of other media outlets operating without those, although i must say you can see

since this has become so hotly debated, most of the companies like google and facebook are certainly becoming much more active in terms of how they're trying to filter out news and filter out -- >> you think it's the right call >> yes, i think they didn't eliminate our congressional twitter feed they only eliminated her personal and on a personal basis, i think it's inappropriate in a time we're so worried about covid to come out with these specious comments of the impact of vaccination. we should all be vaccinated. i came back from frlorida you think it's a different country. in new york no one walks in any store without a mask, doesn't walk into a restaurant in florida it's hard to find a mask they have different attitudes

regionally, depends on where you are. i feel actually safer in new york even though the incidence is higher. everyone's trying very hard to be careful in new york >> alan patricof, happy new year look forward to seeing a lot more of you in 2022. when we come back, the top inside sellers for 2021 and surprise names you might not be accepting. robert frank will join us with the list of who's who. and later, tesla is setting a new delivery record in the fourth quarter it's the proverbial icing on the cake for elon musk and what was a wild year for this billionaire. we'll talk to a musk watcher, walter isaacson, about the year in review and what to expect in 2022 "squawk box" will be right back. care. it has the power to change the way we see things. ♪♪ it inspires us to go further. ♪♪ it has our back.

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welcome back to "squawk box" this morning the final year-end total for stock sales by insiders and ceos is out who has it, robert frank joins us now more. happy new year, robert >> happy new year, andrew.

good morning it was a record year for stock sales by corporate insiders, ceos, executives and board members sold over $170 billion of corporate stock last year, according to data from smart insider. sales up 80% over 2020 and more than 2 1/2 times their pre-pandemic levels. so let's look at the top five. elon musk was as we know the largest seller with over $16 billion. jeff bezos in sect place at $10 billion. the walton family selling nearly $8 billion of stock. mark zuckerberg cashing more than $4.5 billion shares of meta, eight times his 2020 sales and we have todd crockett, director of zoom, he unloaded $3.2 billion in stock, a lot related to options and other notable sellers larry ellison with $728 million, mark benioff of salesforce selling over a half billion, a lot of that

options related and satya nadella selling $374 million of microsoft shares that is more than half of his total stake. the big question is whether all of this insider selling signals a market top daniel taylor of the wharton school who studies insider selling says "decades of research shows that corporate insiders are contrarians, buying near bottom and selling near p peaks. taxes with investors trying to get ahead of any potentially higher tax rates this year andrew >> what was the biggest surprise for you? is there a name on that list for you? >> it wasn't really the names and again, a lot of these are sort of idiosyncratic, some options related. the walmart family has to keep their share of the total company below a certain number but it's just the sheer number. again, we're talking not just nearly double last year but eight times the normal

pre-pandemic levels of selling, and so when you look back at history, and you see these corporate insiders tend to be good, well-timed sellers, selling near peaks, it just makes you sit up and take notice >> robert frank, happy new year and looking forward to seeing a lot more of you this year, hopefully in person, too >> thanks. yes. >> becky >> thanks, andrew. when we come back, what investors need to know on the first full day of trading in 2022 mohammad el erian will join us we've watched futures come off their highest levels but the dow futures up by 182 points above fair value the s&p up by 29 points. by the way, both of those indices are within 1% of all-time highs the nasdaq indicated up by about 123 points, only about 4% off its all-time high. "squawk box" will be right back.

stock futures solidly ahead of the green inflation and the fed the key themes to watch in 2022 and december jobs data the at end of

this week. joining us mohamed el erian, fund managing adviser and president of queens college cambridge. good morning, mohammed >> happy new year, mike. >> this some kind of transitions year, policy offsets to some strong economic growth most likely and inflation fighting campaign by central banks is likely und way what do you think are the key distinctions this time relative to when the fed tapered and a slower growth economy do we have enough of a growth cushion or several factors you think make it treacherous now? >> two distinct elements on the growth side i'm optimistic the u.s. in particular has momentum and we will see solid growth this year

it's the inflation side that's new in a big way these are critical because they change behavior, change price setting behavior and wage marketing behavior and another question, mike, very few people are talking about. when inflation eventually comes down, why would it come down and that's going to have a huge impact on the markets. >> what might be the implications >> there's the ordinary coming down of inflation, the fed gets it just right and demandeases little bit, and the supply side response, that is the sort of goldielocks adjustment, the one that we are hoping for another one which is the policy mistake, because the fed has been so late in adjusting,

because the fed grossly mischaracterized inflation as transitory, it has started late, and there's always a risk it was going to have to slam on the breaks this is a 50/50 issue. this is not clearly in favor of the first orderly one so we have to keep a really close eye on why inflation eventually comes down in the second half of the year >> and the rate cuts before the economy or markets is ready for them, it sort of assumes there is a pain threshold for the fed, there's not a new framework that lets them be more tolerant of high levels of inflation than in the past is that something you think is open for questions >> they look at a cpi at 6.8%, the people saying the core pc will go up and look at the possibility of a handle and this

has become a political issue as well as an economic, social and financial issue, the pain is already there so they are having to play massive catch-up and the question is at what point do they lose their nerve? i don't know what the answer is. i think the marketplace assumes they'll get it just right and the fed has been incredibly supportive of market the continuing of the marketplace is to assume the fed will get it right but economists will tell you that it's not a dominant probability this is tough. the fed has exchanged 70 record highs and the third year of double-digit return for the marketplace for a much more difficult 2022 policy outlook. >> does the way the bond market has absorbed this likelihood of not just higher inflation for longer so far anyway, but also perhaps three fed rate hikes or more in certain scenarios this

year, does it tell you anything about the market's ability to be resilient in the face of this? we have a flattening yield curve to some degree but we obviously have not seen the kind of inflation panic running through the bond market. >> we haven't and that's because the fed continues to buy and we're not going to really see the genuine response of the bond market until the fed stops its purchases. that will happen in the first quarter of the year. you've already had the sense in the bond market of let's keach an eye out for the policy mistakes you refer to it as the flattening of the curve. we priced in quite a path for interest rate hikes. further out of the curve we also priced in concern about demand so the bond market senses it but it's not fully pricing in it yet because the purchases are so dominant >> what are the implications for the rest of the world here

if you look at how markets behaved, asia and emerging markets had a weak 2021, a lot of noise about covid restrictions and things like that and supply chain issues europe's done okay but what would it mean if the fed is going to be kind of leading the way in tightening policy or having less easy policy. >> that's critical, mike if you look purely at valuation as some people are doing, you are very tempted to rotate out of the u.s. and europe into emerging markets in china. that's what you do if you are valuation focused. however if the fed is in play and if the fed can end up with a policy error, you really don't want to do that because we know that when the u.s. sneezes, the immersion world catches cold add on top of that what you mentioned, the zero covid policy which is going to be very difficult to maintain in china,

i myself would not fade the u.s. in europe in favor of emerging markets in chai that because i am worried about the policy error and also worried about what zero covid policy means for economic activity in china and some other people are advocating it last year and advocated it the year before and didn't work out in either year >> let's talk for a quick sec about crypto, because we've been debating this now for years. i'm curious if 2022 if what you're saying is right, does that mean people go out on the risk curve and that something like bitcoin is a great investment or do you think that they actually do the exact opposite, right now at about 48,000, a little under 48,000, $47,000 for one coin >> andrew, it depends on what you think of regulation. i'm hoping that this will be the

year in which the crypto industry and the authorities in the u.s. in particular speak to each other and use a common language, and this is really critical, because china is taking massive steps forward in this space, doing it differently than what the u.s. would do, but they are starting to have an impact on global standards and how people think about this so the big hope is this year, two parts that have not been talking to each other, they haven't even been talking the same language, would listen to each other and try and meet in the middle in order for us to have a common view on what the future of crypto is. if that happens, then the future of crypto is going to be much wider than what it is now because right now, you have this big regulatory overhang, big cloud over your head >> see if crypto can bring us back toward multilateralism.

great to cheng in with you, mohammed thank you very much. >> thank you both and happy new year >> happy new year. when we come back, the yooer in review for elon musk from tweets to record sales at tesla to the success of spacex, look how happy he is dancing. we'll break it down with walter isaacson, writing a biography of elon musk and later hit the gym with the ceo of planet fitness we'll talk about the fitness business and the impact of the omicron variant. i figure going sugarless for the month. i don't know if i can pull it off becausyoe u know i love carbs. "squawk" returning after this.

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tesla posting a record number of deliveries in the fourth quarter, the company said yesterday that this was the case, and by the way, that caps a pretty impressive 2021 for elon musk. other feats include becoming the world's richest person and person of the year honors both from the financial times and from "time" magazine joining us is someone who used to help pick the person of the year, former "time" editor, walter isaacson, history professor at tulane university he's also adviser partner at perella weinberg partners and cnbc contributor and close musk watcher, he's writing a biography about him, too walter, 2021 was quite a year. what do you expect in 2022 >> one of the things i expect is we'll see even more movement with solar roofs, battery packs, also with starlink satellites.

this is something where elon musk has his hand in so many different fields i know after the recent storms we had in new orleans, we figured hey, we got to decentralize our electricity grid people want solar roofs and battery packs, they want starlink satellite dishes so they can they can get off the cable monopoly so i think these things will go along, and of course he's leading our transition into the world of electric vehicles >> walter, you used to be one of the people who picked the "time" person of the year can you certainly make the case for elon musk. he is kind of the person who has help supplant boeing into the race for the future when you look at spacex, becoming the world's richest person last year, the things he's done for tesla, there's a big argument for it would you have picked him as

person of the year >> of course he has two great pligz one is to create sustainable energy both through last quarter cars, solar roofs and batteries, and making the humans a multiplanetary species it's been more than ten years since the shultz shut down and we weren't able to send americans into space he was able to do that over the past year, so i think this notion of returning to space and moves into a suspectable energy future are the two large things happening now, both being driven by elon musk >> so 2022 could be a better year for him, you think? >> i'm thinking it will be much better he delivered as much as a million vehicles for the year, and he certainly has been able to get his falcon 9 rockets to just regularly deploy

satellites, and then to return to earth and land so they're reusable what will make 2022 a hike year for him when he gets the star ship he's building in texas. it will be part of our get to the moon and getting to mars, and as soon as the faa, which has been holding up approval of the launch, you'll see in february or march the launch of this amazing rocketship. >> walter, i have to admit, i like musk. i am blown away by the things he's accomplished, but he is a bit of an acquired taste he says things you can't believe. he tweets things and attacks people -- oftentimes people have attacked him first, but the things he says and jokes about,

wow, i can't believe all these things are coming from warm-up and the same person. how do you reconcile who he is do you love him because of it or in spite of it >> i take a person as a whole, a person in full i have written by steve jobs, elon musk, many other people, as elon musk says, i'm leading the transition into electric vehicles, and sending humans into space, you expect me to be a chill, nice dude as well obviously he as an interesting guy. that make him an interesting subject. if he weren't obsessively driven, staying up night after night, including christmas eve or whatever, worry about the details of the raptor engine he wants to put on starship or the details of the fullself drive system, if he weren't that

obsessed, he wouldn't be having all this impact, so, yeah, he's not a chill dude. >> this guy tweets about his poops and boobs. i don't know how to reconcile it. >> yeah, he has a sort of quirky sometimes sophomoric sense of humor, but it's going to have somebody with a sense of humor you know, you always think -- you look at ted turner, you look at steve jobs, you look at people who made a dent in the universe, they on which have a strong personality >> colorful characters, for sure in terms of looking at any obstacles he might face this year, one of the things we were watching closely in the build back better plan that looks like it's on ice at this moment, but there were lots of incentives

for other electric companies this was kind of like the big three that were going to be prioritized over other countries. >> i think it's a gps idea to get i see transitioned to the electric vehicle future. i think five yearsfrom now, it would be odd for people to say i'm going to buy a gasoline-powered car but, yeah, the biden administration would like to put in incentives for union-built cars, but also cars built in the united states. tesla cars are the ones that are most built in the united states. gm is not making electric vehicles, despite what biden said about gm leading the way. that was ridiculous.

ford makes a lot of them in mexico the teslas are the ones most built in the united states >> walter, how do you assess the risk for tesla also from a consumer perspective lots of questions about the -- and pressure and news headlines about what's happening there tesla tries to do as much as

possible in-house. it goat over the microchip way that way yes, it's going to have to do a d delicate dance even those will be areas the contention with the chinese. i think in some ways he's less exposed. he's about to open a huge fact or, even bigger factory right next to austin, texas, so i think he will be very well protected. >> hey, walter, thanks for your time today always great to do you when is the biography going to come out >> i don't know. a year or two or so. i don't know there's so much information, it's so fascinating, i feel like i'm drinking from a fire hose. this is the most interesting topics of our time with one of

the most interesting dudes of our time. >> it's hard to imagine a cutoff date as soon as you cut things off, there's something new the next day. >> there's something to be said for new editions. >> there you go. i know entirely why he chose you for this. >> hey, thank you, becky happy new year to you all. >> happy new year to you, too. >> even joe. [ laughter ] >> thanks, walter, take care coming up, the ceo of planet fitness talks about getting back to the gym plus dr. scott gottlieb gives us his take on the latest peadlines and when we can expect a ak in cases this wind. student. "squawk box" will be right back.

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♪ with a bit more thought we can all do our part to keep plastic out of the ocean. good morning here comes the first trading day of 2022. investors looking to kick off a new use year on a high note with futures solidly in the green 2022 already a good year for elon musk. tesla reporting delivery numbers. and the omicron variant disrupting travel, business and

return-to-work plans dr. gottlieb will join us ahead. the final hour of "squawk box" begins right now ♪ good morning, everybody. welcome back to "squawk box" here on cnbc joe is off today, but on the first trading day of the new year, you'll see the u.s. equity futures are getting off on the right foot green arrows across the board. dow futures up, we were up even moreearpier today, but we'll take what we can get at this point. then you have the nasdaq up by 120 points indicated you'll see the ten-year yield above 1.5% andrew

>> thanks, becky let's talk some headlines this morning. investors will be talking about some of these issues the big one, tesla shares jumping in the premarket yesterday, the company reporting a record quarterly deliver yes, sir number nearly 309,000 vehicles full-year deliveries clocking in at more than 936,000 cars an 87% jump from last year, ceo elon musk paying tribute to his workers on twitter, saying great work by the tesla team worldwide. we'll get a further breakdown? just a little bit later this our. meantime, shares of evergrande have been suspended in hong kong t. pending a release of inside information 689 every grande is struggling to pay hundreds of billions in debt a city government on a chinese

resort item told evergrande it must tear down nearly -- due to illegal construction then there's this story. verizon and at&t rejecting a government request to broadly delay the roll-out of new 5g wireless services. that scheduled for wednesday, but the transportation department had asked the companies to way for about two weeks, in part because of the interference near airports verizon and at&t say they wouldn't set up the service near airports in six months, but rejected a wider service halt. we'll see how that debate plays out. >> this is something that surprised me i can't believe this is something that's just percolating its way up to the surface. i've only heard about it the last week other so has this debate been going a if that's the case, why was the spectrum sold in the first place?

there's years and bills onof spending into this. >> the airlines have been pushing back for quite some time the faa and others -- this has been brewing, i think, quietly for many, many months, if not longer than that it's only made the headlines perhaps in the last several weeks or last month. by, you know, it's interesting to see -- >> nobody figured this out before they decided to use the spectrum nobody figured out this problem before the government decided to use the spectrum, sell it, auction it off and companies piled billions of -- tell me how many years we've known that 5g was coming? the government is arguing gets

itself how come this wasn't resolved before just the cans of worms this opens at this point, i don't know how they resolve this i don't know how you take on the government, but this is almost the government fighting against the government anyway, it's a conversation we will continue to have, i'm sure. in the meantime we're about 9 on minutes away from the first opening bell of 2022 we come off a banner year of stocks, and the question is, can we repeat a year like this or is that not a great sign for this one >> a great year, 25%-plus, 27% for the s&p 500. yes, they're usually followed by an up over, but tip dale not as strong i think the significant thing is we're coming off three

1578-plus. here's where we sit. the premarket indication is we'll get up toward the all-time highs, those just under 4800 on a closing basis here we just kind of hovered after monday trend obviously relatively strong, no matter what, nasdaq looking at action being very strong, tesla helping that out it's been a divergent story, though, depending on where in the world you look the s&p 500 compared to the european markets as well as emerging markets europe actually held up okay better nom nat growth in europe, actually did a bit better than the dow industrials. the emerging market etf struggled, and looks very much like the stock more broadly. the europe question, is it just -- as we get into a new year, one of things that hovan

takes hold is looking for last year's laggards, looking for discarded merchandise, and in this case it would be several of these growth proxies, cloud computing, perhaps a bit surprising that struggled last year also fintech, we talked about that, especially the newer payments, platforms, things likes that, and the renaissance ipo, we talked about all that. all up them peaked earlier in the years, and you see a similar cad cadence, sort of the edge of risk taking and belief in future growth that's what you see plotted out here >> so for the santa claus last week rally, whatever it was, all the major averages were up, then the first trading day of the new years -- >> so here's how this shakes out. the santa claus rally seen as a bit of a bellwether how at least january might go

last monday's 1.8% gain, whatever it was, gave you a cushion. last week was solidly higher if today and tomorrow leave the market up over the last trading seven days, then you have kind of a green light for that rally indicator. >> okay. so here we go. out of to a good start this morning with the futures thanks, mike see you in just a minute >> yeah. meantime, the trend continues. thousands of more u.s. flights canceled over the weekend. about 150 more have canceled since "squawk box" began. >> the cancellations will likely continue to rise, already over 1800 flights that have been canceled look at the cancellations over the last three days. we won't even show you the last ten days

2700, 2700, and 1400, that's according to flightaware you have a combination of covid-19 hitting the ability of the airlines to staff the flights that are scheduled you also have storms in different parts of the country here in chicago we had a storm over the weekend, it impacted flight at midway and o'hare. airlines have to do things like united where it's offering trip pay to its pilots to pick up extra flight and jetblue, the ceo has been forthright saying, look it, covid-19 has impacted our ability to staff they have cut back their schedule by more than 1200 flights through january 13th the bottom line is this, guys. i think what we'll see is a rough january and q1, remember that's the trough for the

airlines they don't see much leisure business, but typical corporate business, but that's been shot with the surge, so i think what we're going to see -- well, there's some demand for leisure travel, it's going to come back considerably don't be surprised if you see the analysts lower their expectations for the first quarter. that could happened here in the next couple weeks when it comes to having enough employees ready, willing and able to work, the variant is putting people in a difficult position, but the question, all that we have talked about, bailouts and more over the past 24 points is whether these airlines were positioned, whether they did what they said they were going to do when they took that bailout money, not to keep people employed, but to be in a

position to have their airlines up and running, to have the economy humming. clearly we're in a position, take the weather piece out of it, we're not there. >> okay. andrew, you're right that we're not there. you have a couple things going on first of all, when the payroll support program was put in place, that money went straight to the employees it did not go to the airlines. that was a garpt tee that the employees stay on the payroll. that was through the end of 2020 essentially. congress said after that we're not going to do it anymore and you had airlines cutting their stenography dramatically in order to prevent a complete collapse as a result you have a then as you started ramping up, they were not prepared for this

surge. there's noexcuse for that. but at the same time, the money sent from congress to the payroll support program, that ended at the end of 2020 so in 2021, they had to cut their staffs yes, now they are adding back staff, but it's -- you just can't snap your fingers and have the staffing you need. you just can't do that there's no way, especially with pilots who have to go through certification. you have to make sure you have to have a certain time of pilot for a certain aircraft we're seeing it come to roost. >> i have huge admiration for those pilots and those working through it i was on a flight last night you can see how hard a job it is and what they're doing to keep everything afloat.

>> sure. >> having said that, clearly a bailout for that specific industry was they week in a different position they are today. >> you're right about that. >> you're right about that but, remember -- yeah, okay. >> we've got to run. mike thanks, coming up, former fda commissioner dr. scott gottlieb is with us. we'll talk about the explosion of new cases, cdc guidance and more but next we ask the ceo of planet fitness how the outlook has changed. student. you're watching "squawk box" on cnbc you're a one-man stitchwork master. but your staffing plan needs to go up a size.

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beginning of this year, feltness comes in the mid-to-of a coronavirus verge. diana olick joins us with the stock angle on the fitness trend. >> ohm chronic may be causing a pullback, but programs not a return to the gym.

that's why some analysts are bullish on the brick-and-mortar sector peloton was downgraded with analysts citing declining view another not doing so well, beach body it was recently downgraded by several analysts demand for home fitness equipment has slowed, but sales were still up 20% overother overthrough last august. and that all, according to npd group. consumers started heading back to the gyms last year, that's why those holdings were in the green in december. gym visits in october were only down 8% from october 2019.

that's pre-pandemic, according to jeffrey, the analyst there told me last week he does not expect omicron to hamper his prediction of record new memberships. he points to unusual growth in the second and third quarters of last user. so seeing the surge early on bodes well for this year. >> gym visits down only 8% since the prepandemic. thank you very much, diana joining us to talk about the fitness business in the midst of this spice is chris rondu. good morning to you. i may try to go sugar-free this month. i know people consider thing out the drinking, we'll see what really happens, but what i ask is whether you think people will show up? gyms despite the spike in the

country. >> we saw some great momentum last year, which we saw second and third quarter growth that we had never seen before. once the vaccine is out there he at the end of the first quarter, he we saw that trajectory take off. the other thing, too, people working out are working out more, rejoins, and first-time members. the rejoins are the highest we have ever seen they're choosing brick-and-mortar at a faster rate than we have seen >> goldman sachs and other companies are telling their employees, please don't come to the office this thing gets transmitted in the air. so unless you're going to run on a treadmill with a mask on, it doesn't seem to be such a great idea to be indoors right now

with other people. >> that's a great question we saw member traffic, summer of 2020, when we saw the spike in the covid back then before there was even vaccine, we did see a pullback on joins and workouts and cancellations spiking. now we're not seeing that p pullback i think they're feeling more comfortable with protocols put in place, and realizing that fitness is truly essential it's one of the ways to fight the virus, if you get it, build your immune system, and now mental health, where we see it, which is really horrific, it helps with anxiety, helps you sleep better you feel better after your very first workout. i'm excited to announce today, we're the first fitness brand to achieve the well health rating

the institute that focuses on restaurants, and hotels, we went through a third-party inspection we have achieved our seal. we have the right chemicals to use, and taking care of our employees equally as important i hope there's a great stamp of approval here for people to see. >> are you doing things regionally in different ways delta was one thing. if you were vaccinated against delta, your chances of getting delta were relatively low. this variant is a completely different animals indoors, so, you know, i understand you're saying there's more people inside, the question is, is that a good idea? i'm a big believers in working out, a big believer in gyms when you can do it safely, but it's hard to understand exactly what you're doing inside these gyms that can make them safe enough,

given this variant. >> yeah, that's a good question. one thing to keep in mind, too, these gyms are very large, 22,000 square feet, and open ceilings also selfless check-ins. social distancing within our facilities regionally certain states have protocols. 400 states out of 2200 have some sort of mask mandate or vaccination requirement as well. we follow the local guidelines, and the traffic, the people are happy with that. >> what are you doing in terms of studio classes? >> we don't have them in our clubs. well circuit trainings -- but we don't do the small studios, closed spaces in our facilities. >> what's your take, longer term, on the likes of peloton and the whole sort of move during this peeped to working out from home?

>> people have now realized -- everyone knows they should work out. ti unfortunately it opportunity the delta to realize we all should have been listening. 20% of the u.s. population even have a gym membership, that's half the issue there we see hospitalizations, those are the people most ending up in the hospital the difference is we're seeing that once gyms are open, under the circumstances and others, people drop that home fitness and went back to the gym everyone will benefit, and i think at the go for many years, but bricks-and-mortars are where they're going back to. >> i got to ask. you look jacked, you look ripped is there a resolution that you

make for those of us who aren't, we tell ourselves we're going to do certain things >> worked out at my local planet fitness this morning i have a great gym in my business, but i choose brick-and-mortar at 5:00 in the morning my gym in the basement is not exciting maybe i'll try the sugar thing this month as well. >> we'll see looking forward to following everything that happens this year. >> thank you very much. >> i will not be joining you for the no-sugar month sorry, i like it too many. next we'll vet dr. got gottlieb's thoughts, straight ahead. plus, how did tesla blow away the street's expectations for fourth quarter deliveries? and what's in store for 2022 that sckho is up 6.8% this

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futures looking higher on this first day of the trading session. news just out, the ceo of

jeffries & company, encouraging employees to work remotely we're going to talk more about that after the break, because we'll be joined by form ever fda commissioner dr. scott gottlieb. he's got aot t lo tell under the circumstances. student. you're watching "squawk box" right here on cnbc

well, the u.s. begins the

new year in the grips of the omicron covid variant, the strain helping to push case to say levels that were once unthinkable. joining us right now is dr. scott gottlieb, the former fda commissioner and cnbc contributor who serves on both the boards of pfizer and illumina we hear about hospitalizations being up, and that's the concern. if the hospital gets overrun, we have 'problem, are people hospitalized because of the covid, or are they up because people are hospitalized for other things and happened to test positive with covid, because it's so rampant in the general population right now what's the ants? answer >> we don't have good data of people being hospital i'ded, and

they have covid, but don't know it, or they get covid in the hospital about 20% of the hospitalizations were incidental before, meaning that 20% recorded as covid hospitalization were hospitalizations for another cause, but the patient was found to have covid and admitted as a covid admission. i suspect it's higher, but not appreciably higher, maybe 30% are people admitted for other reasons, but found to have covid on admission, but i wouldn't expect it higher than that. >> is not that covid is overrun? maybe that's the critical question. >> yeah, look, we're seeing a clear decouples between hospitalizations and cases it's well established this is less virulent, with the

exception of perhaps toddlers who are more susceptible to higher airway. you also have to worry about regions of countries with pretty big delta waves heading into this, late to the delta surge, and also big outbreaks of flu. that would describe the northeast, new york city, the mid-atlantic region as well. before omicron struck, we had 60,000 people hospitalized, and now omicron on top of that it hasn't completely crowded out about delta. about 30% in baltimore, delta is still is there they're running about 40% of the hospitalization that they say about 15% of the icu admission,

so substantial lower than what they were during that extreme peak so being at 45% of those hospitalizations, it's still a lot. remember it's a healthcare system pressed also by the fact you have staffing shortages. you can't move people around like you were able to do it during the first wave, and also flu admiladmissions on top of t. >> and today is back to school, and a lot of anxious parents our school is not offering a virtual option they made us feel better by saying, don't worry, any day it's above 32 degrees, we're going to let the kids eat outside, and one of my kids' schools said we would appreciate if students would wear masks at all times between bites. which i think is the dumbest

thing i've ever heard. maybe we should ask them to stop breathing in the buildings what do you tell parents >> we've said this before, so i appreciate there's diminished credibility, but this is not going to last very long. we'll be in the throes of this for a maybe a month. in the northeast i think eel sue infections peak out within the next two weeks, hopefully. london has already peaked and probably on the way down this is a fast-moving wave of infection. on the back end, hopefully we're done with covid for a while. we'll have enough immunity for a while. i think in terms of this, the prerogative needs to be to open the schools. if you can keep the kids in strict social pods, you can control the risk there will be outbreaks in that setting. that's really the gold you won't be able to avoid introductions. there will be infections introduced intoed schoolhouse

setting in such a dense wave that we're having, but you have to avoid outbreaks in the school i think can you do that? strict social pods the other would be routine testing, even now -- it's frustrating, schools still don't have access to routine testing >> okay. so let's assume your school doesn't do any testing, doesn't require any testing, doesn't have it available, and isn't really isolating in pods, you know, you still have class rooms and they're three feet apart instead of six feet award what do you do for the next month just wish for the best >> i think a lot of parents are in the rat position. you can test at home children are at risk, except for toddlers, who face a higher

risk, but we're talking about two or three weeks here in the northeast that this is really going to be epidemic schools are opening in the throes of this epidemic wave here in the northeast. i think you can keep kids in a a social pod for a short period of time it's possible. this epidemic will probably pass through the country over the course of the next month, by some point in february, most parts in the country will you through it the mid atlantaics region, the northeast are having dense waves, florida is, parts of the pacific northwest, others parts will lag omicron in other than the countries swept think in less than two months. two questions, one very practical, the other a larger policy question. the practical question, we just had the ceo of planet fitness on he encouraging people to come to

gyms he thinking that's the beway to go healthy would you go indoor gym in an environment where covid, period, right now is ramping up? >> look, i think a lot of people have been taking precautions for two years and frustrated, tired, so you're seeing people throw in the towel. i don't think it's time to let up on your vigilance we really hopefully have just a month of this very dense epidemic wave. this infebles is everywhere, widespread we're makingp picking up a fraction of the cases that are occurring. this is an epidemic being driven by people who have mild infection or asymptomatic infection, don't suspect they're infected i wouldn't be going out. i would be careful the next two, three weeks. and we're going to be on the back end of this, starting to get on the back end of this in a

couple weeks >> so then the big policy question is, should we be investing more in testing long term if this is going to plow through the country as quickly as you say it may, depending on what you think is going object other side of this, you can't end up with billions of tests, if we ever manufactured that many that are not being used, or do you say it's worst that investment in is there an investment to be made in masking? is there investment it is worth being made in things like ventilation inside buildings and the like long term, or do you saying to yourself we're getting through this and on the other side we're not going to need those things >> i think we need to do that. we need to stockpile these things we should have done it before. one of the reasons we didn't stockpile the rapid antigen test says because they have expiration dates

they can have a long shelf life. i think they were pro -- they didn't invest time in the stability studies. just as i have looking at this before the show -- i didn't set this up,s dat date on this test expiring november of this year the date on this test, it expires may of this year, and this is the popular binax -- i just bought these, this expires october this year. some only last six months when you first buy them that prevents consumers, prevents governments, hospitals from stockpiling the tests the first thing we need to do is determine that they can stay on the shelf for a while. one i bought has a two-year shelf life, so we should be investing in the shelf life, and

trying to stockstockpile for what is an inevitable surge of them virus next fall we should expect it. barring some new variant we'll have a lot of immunity in the population, but coming next fall we'll have to revaccinate and look towards masks for people who are vulnerable, certainly not the wave we're seeing right now, but it's becoming more flu-like even this omicron environment in many respects is flu-like, but when you infect this many people, still a lot of people will end of dying from this and being hospitalized >> look, if this is the case, if this is becoming much more flu-like, when does it become endemic instead of pandemic. we don't shut things down for the flu. >> yeah, i mean technically the flu is a pandemic every year, but we have tools to deal with

it i think next fall. this is the transition year, where we're going from a pandemic phase to an endemic phase. omicron was an unexpected divergent form of evolution on the virus, but on the back end, people who have had this twice, will be vaccinated i think on the back end there will be enough of a wall of immunity it won't spread the same wang again. we'll very widely available oral drugs that can be taken. those will be in bundle supply as we head into the summer they'll be stockpiled. so i think we'll have much more immunity in the population and this is the year at the settle into a seasonal pattern hopefully on the back end of this, this starts to settle into a more seasonal pattern and becomes a winter pathogen like most are >> thank you very much good to see you this morning. >> thanks a lot. jim cramer's very first take

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my joints for the long term. osteo bi-flex, plus vitamin d for immune support. shares of tesla jumping this morning after the ev leader crushed fourth quarter delivery estimates. phil lebeau joins us with more on those numbers. >> not surprising these shares of tess las trading about 7% higher premarket, as people were blown away by these numbers.

let's be honest about this i looked at the estimates going into the fourth quarter, and most optimistic was for 295,000 vehicles to be delivered they delivered 308,600 in the fourth quarter, way above the expectations 2021 easily blew past the expectations 90% of the vehicles delivered in the fourth quarter, the model 3 and the model y. as you look at tesla's annual deliver yes, sir, remember, their target was to increase by at least 50% per year. they have easily done that they're up 87% year over year, compared to 2020 most believe now the estimate of delivering 1.34 million in 2022, that's likely going to have to move higher. when you look at what the analysts are saying, they're all talking about the deliver yes, sir and how impressed they were with the fourth quarter and what

they're expecting. baird said deliver yes, sir impress again, remember, when people said, operationally that's going to be the big challenge for tesla. bernstein out with a note saying impressive, particularly amid supply chain issues, but $1 million valuation per car, they still have problems with the valuation, and wedbush saying a trophy case quarter with momentum building. remember deutsche bank, jpmorgan, rbc, they're all out raising estimates for the first quarter. i wouldn't be surprised if we see more estimates raised a bit later on mike, the bottom line is this, tesla easily blew away expectations now people are looking at 2022, how much higher do we have to bring our estimates for 2022 deliveries?

>> stock making you have some ground it's 15% off its all-time high phil, thank you very much. andrew thanks, mike, we want to get down to the new york stock exchange, where we welcome jim cramer happy new year, my friend. would love to get your thoughts, on tesla, and whether you think this changes the dynamic from being an investor in the company. >> i think phil is right when you get this leverage, where they end up making more money, with the semiconductor shortage, the gross margins going up, with what toni sacconaghi said, this could be another year of living magically. you do not value tesla by the car, but by market share i think phil has made a very impressive kay so say there is really no other company that's in its class

it's obvious that an ev is worth a great deal more than a combustion engine. they've got to get rid of it they have to get rid of the business that tesla doesn't even have i think getting rid of it, getting rid of the union workers involved is going to be very, very difficult i think that the valuation is not wrong. >> jim, you made a provocative comment on twitter about three hours ago, right when the show was beginning, somebody you said i hope powell doesn't move too fast you linked to some of the news on how quickly we're seeing the variant play out >> i understand what during the time gottlieb said, he's the best, but when it comes to actual stocks, there would be gigantic supply chain issues i think it gets under control in 2022, but not fast enough.

so the fed is just going to say, listen, we've got to start, without thinking about how omicron has basically made a lot of businesses going to be like the airlines, just decimated you have a false tell about inflation. i'm not say it's going back to transitory, i'm say powell should be careful. i don't think we realize how much has been shut down by omicron, not in the way we think about government shutting down, but the way they can't fill shifts anywhere. >> we've been talking about airlines this morning. i just got off a plane last night, are you of the view -- airlines have come off, by the way, with this so the question is, are they at the bottom, or is there a lot more to go >> i did like the call and how delta has good international, but nobody is flying internationally yet. i know they're going to raise rates after this is over

that's what you're banking on. i am bullish for 2022, i think there's a lot of valuations in the companies that mike santoli is talking about look, andrew, we're here in new york, honestly, can you name is a family where someone doesn't have omicron >> everybody i know. we're just trying to make it through. i've already told my kids we probably won't, but we'll see s everybody's dealing with it, everybody's dealing with the kids going to school, everybody is dealing with testing, it's everywhere it's everywhere, the only hopeful news of this, at least i'm hoping, it will be mild. i'm glad to see, by the way, you back in action and looking great. >> thank you i never knew that i had it until i tested with the abbott binax,

but my wife just came back from miami. sheesh, i have to work on this thing. jim cramer, we'll see you in a couple minutes we want to remind you about the cnbc investments club. you can sign up to get it or just point your phone at the gr screen i get it regularly "squawk box" will return right after this i know that's right! prime never believed in double coverage, but health insurance and aflac...is money. ♪ must be the money ♪ and i know how coach prime feels about money. -aflaaaac. -♪ aaahhhh ♪ now that is what this jacket needs. ♪ must be the money ♪ get help with the expenses health insurance doesn't cover. at aaflac.com get help with the expenses health insurance doesn't cover. today, you have to deal with a lot of moving parts. you want everything to be on autopilot. and to be prepared if anything changes. with ibm, you can do both.

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a bit more than a half hour before the first wall street opening of the year. brian, good to speak with you. set the scene for us we have not just a big up year in stocks. last year three years up in a row, seven straight positive quarters what does that all tell you, based on history >> mike, first off, thanks for having me. if my cincinnati bengals can make the playoffs, anything is possible [ laughter ] up 25% of the year, the last seven times the s&p 500 was higher the next year five of those times up at least double digits. what we're telling our advisers, yes, we had a great year it's not going to be as easy as it was, but we're pretty optimistics. another one, up seven quarters in a row that's a lot, but you look bulk in history, you actually have

stronger performance back from world war ii, the s&p 500 has never been lower so we just laid out some pretty positive things t. momentum is a powerful thing a better we'ller than we expect, all these things have led to a strong market, and we think it probably continues. >> trends do persist authorities seven quarter win streaks, how many of them before about a half dozen >> that's correct. i believe this was the seventh one. again, they can keep going >> we obviously, everybody now collectively expecting fed rate hikes this year, so we're transitioning into monetary policy bonds are selling off pretty aggressively the first rate high in a cycle typically doesn't totally change

the game what is the dynamic there? >> that's right. we looked back at the last nine times. the s&p is up 15% going into the first rate hike, but when you look back at history gin, after the first rate hike, stocks actually do better six months later. that third or fourth rate hike, maybe that's when you the applecart can be upset i like what jim talked about before i came on we're a little skeptical we'll see a rate hike the first half of this year with the omicron concerns still there, but there's a rate hike coming, and the market typically takes it? stride >> does that make sense? is there a rhine to thinks

otherwise? >> i would agree 5.2% corrections most we saw, you look back at history, that's extremely rare the following -- let's not forget this, this is a midterm year the most volatility of the four-week cycle. well over 100% rally, maybe we could have something like that in the midterm year, but the economy is still strong. we still think stocks will be higher it won't be as easy in 2022. >> in a mitt termed year, where you normally have a sell-off before the reaction? >> usually you do, but remember 2018 we had a correction, remember that one, but norm ate it's before the midterm election and a year after midterm election, the returns are really strong we think upward bias is alive

and well. >> brian, thank you a lot. thanks, mike a quick final check on the markets. the futures are still indicated up this morning. nasdaq has pared its gain. oil turned negative, so keep an eye on that, too we do have an opec meeting today and tomorrow mike, we'll see you back here tomorrow morning, and going to hand it over to the gang on "squawk on the street. jim, i feel your pain here with the makeup see you later. >> good monday morning, welcome to "squawk on the street." david faber, welcome to 2022, starting the way last year ended, with decent premarket gains. jobs friday, of course, the bond market is closed, along with china, japan, uk and canada.