continuing to climb and the 10-year in germany just went positive for the first time in nearly three years hard to imagine. we'll hear from bank of america and morgan stanley in the next hour or so and fintech startup sofi cleared the final hurdle for starting a bank january 19, 2022 "squawk box" begins right now

washington will get its turn to react as well. you had some good timing as well hearing what regulators would react as well. we have a special interview coming up with lina khan her first sit-down interview as the head of the ftc. her perrovocative views of amazn and other things are egg sister to see it we'll bring you highlights here later on squawk. i'll do that with our good friend cara fisher who will be sitting in as well a lot coming in over twitter some of our squawk viewers have questions, send them along,

please >> a small piece which is the gaming business. you could look at sony and tiktok as -- tencent as being

bigger if something like the biden administration will take an approach like this today, it will be interesting. investors in activism some what concerned. >> i'll call an audible. we should talk about sony. again, people are concerned about whether this gets through. something making oversea's concerned about as well. lower in japan almost 13% down by new concerns of competition that would be posed by momicrosoft and act vision combined $95 a share, it is an $80 billion deal advisors recommend shorting sony

shares saying sony will have monumental challenges to stand on its own in what is called a war of attrition. it will only get tougher we'll talk more about the microsoft-act vision deal and the metawers another big story taking place in a fight at&t and verizon delaying the 5g service after airlines warn it would lead to flight cancellations. scheduled to begin the rollout today. it would temporarily delay while it works with regulators on a sugs the frequency used thanks to

altimeters use joining us in an exclusive interview to break it all down surprising we are even at this point given the time they've known and frankly how many other countries have 5g service in the works and it seems to have not created such aproblem.

>>. >> made some incredibly good points wondering technically, what's the problem. this is already being used in europe he made the point that in europe, they are using a weaker signal the technical issue when you build one of these ag towers, the concern is that the signals from the tower would interfere this is a serious issue they've known about and had concerns about for a long time.

faa saying this the ftc kind of blue it off. here we are after carriers spent like $80 billion on this why is this so huge? i can't believe we got to this point. i tend to give the benefit of the doubt to the faa if there is any question about how high you are in a plane -- >> call drop or plane drops? weighing that out. >> like those movies you want to get those downloaded quickly. >> to say this was going to go

>> that's a first. this is some good news, i think. pfizer says the new anti-viral was effective against omicron saying the drug will be useful combatting good against this one, what about the next one and the one after that a different part of the virus it is targeting expected anti-viral pills from pfizer and merck may work even though vaccine efficacy has declined because they target the virus's ability to recreate.

almost like a therapeutic. it gives you the ability to fight if you get it. >> a little like the flu shot as well >> and this is like tamiflu. i pop that the first sign of a sniffle. you don't get the flu if you take tamiflu it is an approved drug i take it. i like it. >> the second you get a sniffle. >> it is expensive >> don't you have weird dreams when you take it >> weirder weirder. >> never mind. >> i had one last night.

can i go into it no bi biden administration rolled out the free covid tests a day earlier. saying the website was in testing phase. orders placed are valid. every household is limited to four tests users facing difficulties placing with apartment addresses. if you have troubles ordering call 800-usps and put it on speaker phone. >> i did hear from people who had success. >> i'm not going to order it because i already have tests i got. i can afford the tests

there won't be enough to go around with 500 billion. i think brian said he would get his, shipping expected end of this month good start >> we have some earnings out it dow component united health group. 17 cents above the expected estimate revenue also beat expectations and united health with a boost to strengthen. you can see that stock right now up by $1.15 which is a gain. we have a lot coming up over the next three hours a busy morning for earnings herement with the squawk planner we'll tell you what is up. and we'll talk about the demand for covid testing and with labcorp. the conversation you don't want

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welcome back to "squawk box. we'll hear from bank of america and morgan stanley

united airlines after the close and we'll hear from proctor and gamble ceo and on the data front, we'll get december housing starts at 8:30 a.m. eastern a quick check on the market's biggest movers good morning to you. everybody trying to make sense of the market. i would love to hear your views since we are talking about it all day yesterday. how would you play the microsoft act vision deal. would you? >> i think it is a great deal for microsoft. these are the areas they see

secular growth remember, they bought mine craft. this was the largest deal in the space. they are taking advantage of the price decline. we know microsoft has tons of cash they are acting and expanding now. i think people were expecting microsoft to get into security and make a security deal for now, people were taken a little off guard. >> you want to own act vision at 82.50 where we are right now if this deem closes, there is a combination of do you want to sit in this stock for cash at that period and what is the regulatory bet >> i don't think you do. it is a long time to wait. unless you are in arbit are

everyone age i like to focus on fundamental i don't know microsoft but i like what they are doing if this stock comes down, that's the way i think you want to play it you've got many ways to win with that company it is a valuation that holds me back i'd rather play the microsoft side on a pull back. >> i'm looking at moderna. that had a big move down about 8.5% would you look at that >> i think right now, we have to sit back and look a little more on the inflation data. i thinks that what is going on in the market. we got so much of it we know wages are going up, rents are going up and food, everyone has to act. are they behind the curve or

not. they have to act they have to act more quickly. this is a reason why rates are going up i'm watching inflation rates going up 1.88 this morning you know the market doesn't like surprises. it has happened so quickly those are the things i'm watching i love united health care. i'm overweight the banks it was a total overreaction. we don't own it. i'm more inclined. >> let me ask you this, i don't

know if you saw on the broadcast maybe arguing it doesn't if the fed overdoes it and slows down growth, for sure. i'm in the camp of after omicron, we get past it, hopefully, that you will see another spike in terms of growth and you will see above average growth for the economy in 2022 we have to see about the second half you'll see a flatter curve i'm not in the camp at the moment my largest position in my portfolio is wells fargo the reason is because it is a restructuring story. they have a new ceo and tons of costs they can cut

they were by far the best bank so far in terms of reporting earnings everyone else has been raising expenses and that is key operating leverage if you find some stories that are these special situation names within financials, those are the ones we want to play wells is still 1.3 times book. and news at american express and loan growth growing in december. love that name as well you can pick your spot and it doesn't have to be so yield curve responsive >> thank you appreciate it. >> thank you becky. >> thank you, when we come back, sofi clearing the last hurdle for becoming a bank. we'll show you how the stock is reacting we head to that break, check out

the yield on the german 10-year bund it is actually trading in positive territory this is the first time that has happened in nearly three years because of surging inflation it finally looks like it will payoff if you loaned somebody money, you may get it back with a little bit of interest too "squawk box" is ahead. ♪♪ ♪♪ ♪♪ i'll shoot you an estimate as soon as i get back to the office. hey, i can help you do that right now.

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time now for the executive edge

employers are beefing up 401 k accounts in an effort to attract and retain workers 16% of large companies are increasing contributions with another 8% saying they are considering a move like this a 1 to 2% bump in company's match or a one-time contribution on top of the match. others allowing new highers to participate in the plan immediately instead of a waiting period watching shares of sofi soaring. receiving approval from the office of the comptroller to become a bank holding company. planning to close the deal to acquire golden pacific bank corp in february which would then operate as sofi bank they went public last year by spac lead by investor chamath,

who we have been talking about >> we have tiktok holder of bytedance has disbanded investment plans to disperse employees to other parts of the businesses. considered the world's largest startup. coming up, we'll look closer at insider sales at peloton that were very well timed ahead of a big drop of the stock. robert frank has that story. a look at yesterday's s&p 500 winners and losers

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good morning welcome back to "squawk box. if we take a look at the markets, green arrows on the board. the dow was off by 1.5% yesterday. the nasdaq really took it on the chin we continue to see rising treasury yields. that is the picture that continues this morning nasdaq by 28, s&p up by six. the 10-year yielding 1.883%. yesterday, the 10-year yield this morning yielding 1.05%. putting pressure on mortgage

rates as well. looking at buying a house, it is going to cost you more money it is up 83 basis points those rates are not high historically will cost more than it would have a year ago. goldman sach up 7% bouncing back. up by about half a percentage point. wti, crude oil, closed at seven-year high. higher than that at this point up 86.49 we must have flipped the crude oil chart.

yesterday, oil was at 86.51. now 11%. was one of the underperformers yesterday. the worst day since all the way back to march of 2021. one of the big losers down up by about 1% that crazy pandemic. remember the negative oil. a crazy technical thing. >> negative oil. >> and $167 peloton. peloton shares have plunged to now about $30. the market cap is $9 million

amazing how things seem to make sense in a given period. some executives seemed like they knew this or they had some well-timed scheduled sales because they avoided the big drop robert frank joins us now with more welltimed. selling between the end of 2020 and the fall of 2021 most for about $110 a share or higher

they mention trade around $30 a share. peloton did not respond to request for comment. according to sec filings, he started a preselling program for financial purposes that planned for selling millions by october 2022 so far, he's sold over 11 million shares with the last sale last august other executives cashing in those highs. chief culture sold $90 million and product chief sold over $60 million. total insider sales $496 million. that is a lot of a company this

size andrew, you've got the peloton >> i've got the peloton tread and i love it. >> has anybody ever said, can you sell on a certain date but you can't cancel your sale >> one thing people do is, you can't cancel your sale. >> you are right that's a great point looking at how much flexibility should be planned. looking at not only some people pausing their sales but also escalating them so it seems like

they cannot only decide to end it early here or change how much they sale with advanced notice. >> it looks like something they will look into it. >> i did get an unbelievable workout when i was carrying the bike with a friend up the stairs heavy. >> joe, did you get rid of it? >> oh, yes i sold it for cash >> during the pandemic >> we sold ours during the pandemic as well probably a year ago. >> robert, you used to bench it, right? >> or bicep curls. >> you look like you could >> i don't think i can even ride a bike

bench pressing the peloton all right superman, clark kent thank you. >> our own clark kent. when we come back, sony shares tumbled following that deal between microsoft and activism we'll look at the metaverse play and what this means for others in the industry. for sony, not good stock down 13% don't miss our exclusive interview with verizon ceo talking about e th5g roll out. what the solution is what is next watch cnbc any time on the cnbc app. ose resumes on indeed match your job criteria. visit indeed.com/hire and get started today.

microsoft, $80 billion deal may have begun a metaverse arms race joining us on air just after the announcement >> going back to the launch of the x box. we've had many conversations over the year.

we've seen it start to become apparent resources and talent we needed on the journey. we realize now is the perfect time for a conversation. >> joining us now on the race. at the future firm tech intelligence group we'll start with you, what does this mean for the overall industry >> i think we'll have to brace for this more of the m&a maybe some companies in the wait and see mode, this sets the alarm that they can no longer wait for some other players, it might strengthen possibility for ipos in the future. i'm looking at epic games or

niantic, they will potentially want to go to an ipo >> sony shares down 12.5% on concerns it is difficult to compete with this new combination, is that the right reaction to sony shares? >> i think sony has an opportunity as well to level up to make new announcements and partnerships we'll have to see how it goes. i will say, now that i look at what's happening with microsoft and activision i think good game pass will this become the new amazon prime? >> brian, what does this mean now that microsoft has take b the first step what do you expect to see happen

next >> anyone in big tech will receive share holder scrutiny along the lines of what are you doing to take advantage of this opportunity to usher in the next again operation. >> you think this is the right move paying top dollar and that this is necessary right now? >> i think so. especially for those sitting on enough cash. i also think it is important to remember how narrative driven equity are taken in a role a few months ago, they raised $200 million from epic games that gets washed away when we you news break e

>> we have some breaking news from bank of america we have those numbers. >> we have in line revenue $22.2 billion. the forecast was a slight beat on 82 cents a share. it has been a tough environment for the banks trading off the back of that breaking through some of these net interest income, key for bank of america, interest rate sensitive. $11.5 billion ahead of forecast for $11.35 billion net interest margin, 1.67% so one basis point decrease from last quarter which is a bit of si your prize. it is a beat on the interest line loans look strong here their loan growth up 8% when you

strip out ppp. it will be interesting to hear if they feel like that can continue in the year ahead key for the banks has been expensive at $14.7 billion broadly where people are expecting it up a couple percent from last quarter. dpieded to that early december with the financials conference a line here that suggests they are saying 2022 expenses should be flat on 2021. that should be seen as a relative victory some has been really hurt. jp morgan numbers and goldman's numbers yesterday. expenses year over year should be seen as a win trading, a little lore on a fixed income that is quite good investment banking also strong

up 26% year over year. they've got a fractional benefit in the provision for losses whether there is a fraction expense here or the small item the headline here is that loans look strong here expenses are flat year over year that will be taken well by the market and stocks recover a little bit >> yae, i think that is probably the key issue. really talking about inflation out there. that has people wondering where inflation is down the road >> different type of expenses for bank of america. for goldman, it was pay and a long-running cost cutting move put on hiatus and keeping costs

under control in the second half of the tenure. seeing some wildcard surprise like we did. like they say, it will be flat in the year ahead. the positive loan growth was good net income was flat or down despite rates rising q 3 to q 4. guidance on the area will be important. >> thank you we look forward to hearing the conference call. in the meantime, let's get back for a quick final thought on the metaverse deal you and brian both are of the opinion that these deals will happen we haven't talked about washington and what they may or may not do to allow this if you looked at activision

shares, the question is whether this will get passed >> yes this remains to be seen. increasing the gaming space and virtual reality with facebook, formerly facebook meta a lot will happen on capitol hill when it comes to metaverse and gaming for them to understand that this is in some ways the parent to the future of the internet >> what is the most important aspect of this >> i think they are building their metaverse back they are looking at es poos they have to usher in this new technology and what promises to

be the next iteration and they are determining what they need whether that be hardware or networking, and hardware providers. >> thank you both. i get the feeling we'll need to talk about this more this will take a while coming up, leeds maniac assemble steve will join us with a look at a new conundrum of the federal reserve. "squawk box" will be right back. with verizon 5g ultra wideband now in many more cities so you can do more. mindy! with 5g ultra wideband. downloading a movie up to 10 times faster than before. oh, is that the one where the mom becomes a... (mindy) yep! (vo) i knew it! good morning. hmm...office or offsite? to the coffee shop. public wi-fi? no thanks. 5g ultra wideband is faster and safer. yup! and claire in hd clarity. low lag on the go.

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well, it's a ten-year note now approaching 1.9% first, well, that's neither here nor there. the fed-ex pictured to hike four times next year. economists are turning their attention to how different sectors of the economy will be affected and to a potential conundrum for the federal reserve. senior economics reporter are steve leashman joins us now with

more i guess two is going to happen it hasn't happened yet, though we have been waiting so long, i'm not sure >> as you spoke, it went up to 1.9, it com back down. 2% is not far. here's the bad news, interest rates are up and headed higher economists think this may not do that much damage, as a whole, some sectors will feel it worse than others. equities will suffer valuation and housing already hurt by higher mortgage rates as the fed likes balance rate reduction, while the market may take a hit, many companies won't feel too much pain, they have cpap explains, you shouldn't be too coupled, autos, they're likely

to rebound no matter what happens despite higher financing costs because production are so far below normal they suffer multiple supply chain problems all of this raises a conundrum for the fed. how is it where big parts are marching to the tune of the pandemic i talk to michael feroli from j.p. morgan, he says it doesn't seem like it's that much problem for the economy. barclays is hoping it may be the primary because most of the economy is a pandemic story. the fortunate result, according to david zerbos is of fed says it's biggest way with housing that can affect the economy. at the moment, the guys i talked to yesterday, they were raising

their forecast for the fed that's what i reported on monday or tuesday, but they really weren't lowering the forecast for the economy that much. >> the boone, did you have a party or confetti or anything? it's positive. >> yes >> we're positive now. i was looking, joe, at the spread this morning. it's still 186 over the u.s., so that has actually been rising. it hasn't been unchanged since the first quarter of '21, so it's still a relatively stable differentiation there. that's ultimately on the u.s. >> they immediately attributed it to rising inflation in germany. so that's strue u screwing up over there apparently. i don't think it's biden's fault over there, maybe it is, i don't know >> no, inflation is a global issue. what is really interesting, when

you take apart what's happening inside the interest rate complex, you've had a decline in tips for implied inflation inside tip spreads but you had yields go up, it tells you it's not inflation that's pushing this up right now, it may be what the feds don't do where a balance sheet and it's a growth story. it was this hour we were talking about the idea, hey, we get through this omicron outbreak. >> andrew, i thought you were -- >> i was going to jump n. we're out of time. steve, thank you i wanted to ask you about the fed abiding by the market plan we got a big two hours ahead, coming up, procter & gamble ceo will dig through the company's earnings straight ahead.

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mueller. pressure on ukraine is putting pressure on oil prices crude hitting a seven-year high. and the surge in omicron straining the testing systems in place across this country. long line, long waits and short supply the ceo of labcorps will join us to talk about all of this as the second hour of "squawk box" begins right now good morning, welcome to "squawk box" on cnbc i'm andrew ross sorkin along with becky quick and joe kernon. i'm in washington, d.c. this morning ahead of an interview with lina khan, her first sit-down interview i will be joined by kara schwerber from the "new york times. we have an in-depth conversation

on big tech, big business and the sec's approach to the current wave of mergers and acquisitions you can join us a little later today on this edition of capital exchange it will be live on your second screen cnbc 10:00 eastern time we will bring you the headlines right here on cnbc meantime, u.s. equity futures two-and-a-half hours before the market is set to open after what was a rough day. the dow looks like it will open 100 points higher, s&p looking open 16 points higher. >> that's because proctor&gamble is a dow component it came in with earnings that were better than expected, $1.66. penny above, sales came in at $21 billion versus the 21.34 billion. some comments from john mole early, the ceo we will be

speaking with. he says they delivered very strong top line growth and made sequential progress in the face of suspect cost head winds he is saying the results keep them on track and raise estimates for sales growth, cash productivity and some of the important numbers when you dig through and look at it, excluding for current exchanges, acquisition, divestiture, organic sales up 6% because of an increase in shipping volume, there has been so much demand from consumers the other part of it, three percentage came from increased pricing for input costs. so this is a sign of a very healthy consumer and a company able to raise price and have those prices stick the question is, will it continue >> the organic sales growth is what we look for the previous guidance is 2-to-4%. that has been raised for the year from 4 to 5 so it was 2-to-4 previous. that is much better.

the last time john was on, we actually the asked him, he had like 6% last quarter, too, we asked him, why are you at two-to-four? they were somewhat conservative. this is so much better the stock immediately i saw it as high as 160 they wanted to trade there. that's always what we're talking about. i guess a weaker dollar would be helpful if that happens as well, but. >> if you look at the volumes, joe, in terms of the shipping jums u volumes they had, 4% increase for healthcare, 7% increase for fab brric. 4% if grooming, things like shaving and things family care, they were able to increase prices i can 3% on that stock. so we talk about the high commodity prices it also signals inflation. >> the last time we had him on,

he went to 2.4 million in terms of commodity price increase headwinds from 1 point 9 and there is a possibility they go above the 2 .4 how many analysts some on and say i want companies with pricing power? at this point proctor&gamble has pricing power. it doesn't seem to be costing people a half of a sales gain if increase in prices that's more than offsetting the input costs. >> we were looking at a pretty hum drum day in terms of the futures before this news hit you were looking at the dow futures, they were up 25 points, maybe a little more than that. this is really a kind of turning a new page an another story to kind of dig into and check things out that's what's so interesting about earning, every day, it's a few story. >> every part of the story proctor&gamble at any part of the world where people aren't

buying something from proctor&gamble >> every day, last week it was the financials, bank of america today. it's every day you will get a glimpse into a different part of the economy as we hear more from these companies. because we're at an inflexion point, this is a very important time to hear what they say. >> and we will. >> we will be speaking to proctor veo jon moeller. he will be joining us. other headlines, at&t and verizon have partially agreed to roll out a part of the services, they won't turn on signals located near some airports it fears they may interfere with avionics the 5g service they're not sure what it will do to safety. we have verizon ceo hans vestberg you den want to miss what he has to same. we will be getting earnings from

morgan stanley investors will be watching this closely after rival goldman sa sachs. the company spent significantly more to attract and retain workers. we will watch to see how that impacts morgan stanley meantime, youtube shutting down the youtube originals, that debuted if 2016, there is a potential netflix competitor other than its very first show the karate kid spin-off cobra kai. ironically it care i airs, where else on let in flicks. >> it does. let's go to dom chu for this morning's premark vet view. >> the big banks out so far is bank of america. those shares are on a rise on a mixed report the earnings come in better estimates better than the highest end estimates that wall

street was looking for revenues were you can call them inline or slightly below expectations bank of america helped along by some of the growth investment banking business they had a good year for that. also they have low loss reserves, less people paying off the debts. bank of america shares up 2% right now over the last year up 44%. so certainly one to watch there. another st. a dow component, a big one, it is the biggest dow component by waiting by overall influence. that's united health group up $4 per share, nearly 1% gains there. the reason i say that, that translates roughly into 25 to 28 points on the dow. it comes with both top and bottom line helped along in part because of the optum business that mansion pharmacy businesses and medical practices, doctors, united held up 1% of that news. analyst move a red hot sector taking a bit of a

breather on fears of rising interest rates part of the thesis analysts at key bank have downloaded home builders, you see, lennar, kb home, toll brothers, they're accelerated. dr horton was a buy rating, now more neutral a. lack of near-term catalyst playing to why analysts are downgrading home-related stocks. watch those. becky. >> all right dom, thank you very much when we come back, shares of procter & gamble right now are higher after the company came out with better than anticipated results. the stock right now up by 1% we will give you chance that to talk to the ceo jon moeller to talk about the results, the supply hain, inflation and maybe most importantly the pricing power that company is seeing right now before we head to break, let's get a check on the markets the dow component, it's indicated up by 87 points.

s&p futures up 15, the nasdaq up by 55. "squawk box" will be right back. to your financial plan. bill, mary? hey... it's our former broker carl. carl, say hi to nina, our schwab financial consultant. hm... i know how difficult these calls can be. not with schwab. nina made it easier to set up our financial plan. we can check in on it anytime. it changes when our goals change. planning can't be that easy. actually, it can be, carl. look forward to planning with schwab. schwab! ♪♪ at fidelity, your dedicated advisor will work with you on a comprehensive wealth plan across your full financial picture. a plan with tax-smart investing strategies designed to help you keep more of what you earn. this is the planning effect. your shipping manager left to “find themself.” leaving you lost. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description.

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get a great deal for your business with the ready. set. save. sale today. comcast business. powering possibilities. zblmpls. proctor&gamble out with second quarter results, quarterly profits, revenue 29.95 become compared to a estimate of 23.4 joining us to break down the numbers jon moeller president

and ceo of proctor&gamble. there is a lot of organic sales forecast and probably explain the action in the stock. jon, just right out of the -- i love this. i saw someone's take on it p&g beat sales forecast and raises its outlook on resurgent demand for cleaning products i didn't even think about that but i wish life was so simple. you must have done well with cleaning products s. that why you are raising your outlook on the year for resurgent omicron-related cleaning >> first demand is strong. but that's across our breath of product categories you know, we have then out of ten categories that are growing in mark share in the last three, six and 12 months. and that's translating to pretty strong bottom line we grew our remains a year ago, despite significant increases in

commodities and transportation and as you indicated, those results allows to recon firm our guidance for fiscal year, which ends in june fiscal year, bottom line, increase our estimates, the top line, cash productivity, cash return to share owners i really want to call out our broad organization certainly, the supply organization has done tremendous work to keep us in supply under very difficult conditions. but also our innovation organization who's providing the kind of product performance that allows us to take marginal pricing to help offset commodity costs. >> the organic sales growth last quarter was good we talked about it it was the first quarter, so i don't know whether for the full year you didn't know if it was a repeatable or whether you have more clarity now but that's, you know, the amount of stuff that your company sells around the world, if you go

organic sales growth from two-to-four percent where you were previously four-to-five that's significant so what changed there in terms of being able to say that now? >> one more quarter of business and very strong results. >> so that's all you can do that and a lot of that is that consumers are willing to pay up for what proctor&gamble is offering, half the sales increase was in raising prices >> well, important lip, half of the top line increase was in unit volume, which speaks to innate demand. >> okay. >> but, you know, on the price end topic our business model has a formal component of pricing. pricing has been a positive contributor to our top line for 17 out of the last 18 years, 42 out of the last 45 quarters. when you have a business model

that's founded on innovation that provides higher levels of delight, solves problems better upon the consumers, you are able to charge a little bit more. then while it's very early for these commodity-based price increases, to date, we see very positive signs, probably 20-to-30% less price elast icty we were expecting. you look at private label shares, being the lowest price offering in the market they're down in both north america and europe so i think there is a real push to quality products i know and trust that can do the job i need done for me and my family. >> jon, let's talk about headwinds and you got, you roll it all into one number but let's break it down a little bit. so i mean freight costs, oil is,

4x is not a tailwind 4x is a headwind then the input costs and commodity prices you said 2.4 billion last time you were on. that made some news because i think you had 1.9. is it above 2.4 now for your forecast as inflation has continued? >> so i'm going to give you a absolutely defendant number. but the combination of commodity costs and transportation costs have now up to a $2.6 billion headwind that's up incrementally versus the last time we talk and as you indicated 4x has turned from basically a neutral position to a headwind as we worked our way through the quarter. the organization is doing a tremendous job on productivity across the income statement up and down the balance sheet, which has enabled us to offset a

significant portion of these costs, pricing will provide some offset and then just very strong innovation that continues to grow markets globally the mark has grown 5% in the last six months and that doesn't just happen it's not just an accident. it's a lot of hard work on the part of a lot of smart people to provide better solutions to consumers around the world >> hey, jon, we've heard from people at jamie dimon about the strength of the consumer right now, how they have more money in their bank accounts, how they're willing to spend more. how they have been pretty flush. what do you see? i mean, pricing power certainly suggests it's a strong consume early. we did have things like the child tax credit end in september. have you continued through january to see that same strength of the consumer >> demand has continued to be

strong jamie has a little better insight into the totality of that, but what we see at the store is very encouraging. and that's not just in the u.s., that's in europe we have very strong quarter in latin america, 15% so there is -- it's not that surprising because the products that we offer are relevant as people spend more time at home, more meals at home, more dishes washed, and as they work to protect their family and against the health threat that we have all been managing against the last two years >> jon, i mean, it's difficult i think for all companies now to try to manage around the world i mean, the parent company cnbc is going to broadcast the olympics there is a lot swirling around if terms of how corporations need to approach china at this

point. are you a major sponsor of the olympics in the boardroom, what are the discussions look like? i mane, are people, chinese people buy a lot of your products, obviously? i don't know whether you need to take action against an entire country based on the political infrastructure there do you have these discussions? how do you approach it >> as you indicated, china is an important market for us. it's our second largest market in both sales and profit top line grew averagely 10% the last four years. the quarter we just completed, there was some economic slowdown which you saw in the figures released yesterday still on a two-year stack basis 12% growth and that business is profitable but, you know, as relates to the olympics, we view this ver we have for years supported athletes and their families. we support international

interaction, which generates learning, awareness and ultimately acceptance of each other and we think those are fundamental benefits that are worth supporting >> how many employees does p&afte p&afternoon g -- p&g have? >> what do they tell you about whether it can continue, transitory, based on semi chain, whether it's the federal reserve which is behind the curve and printed too much money, not just the fed but around the world it seems leak it would be very important for you to have a pretty good feel on what you expect what are your best mind? and i do realize you are an economist, i don't expect much

here, what do your best minds say about what's likely to happen >> some of it is transitory. some of it is not. there is an answer for you i'll just give you an example. if you look at transportation, what fundamentally is driving the inflation in the transportation market? well, you have to go all the way back to pre-covid when the u.s. regulations changed in terms of the number of hours that the driver could drive so that fundamentally impacted supply covid has impacted supply. these people are just like you and i. they have families, their children are sometimes out of school they have family members they need to tend to from a healthcare standpoint. they have their own healthcare needs. all of that affects supply if you look forward just from

the supply side, i'll come to demand in a minute but from the supply side, significant investments in infrastructure, which are a very good thing will impact the same labor pool if you look at the demand side, which isn't being talked about a lot, you have the fundamental sector of the economy we have been talking about this morning. you also have a fundamental change in veteran are purchasing products leak ours the significant increase in online purchasing with delivery to my home changes the math significantly. all that product used to travel in someone's car that now needs a truck. so the demand side of the equation both base on the economy and change in shopping patterns, coupled with supply situations, you look at that and say, is there a reason that that's transitory? i don't think so i could be wrong i'm not an economist it's just an example of some of the increases likely here to

stay some of them commodity cost increases in industries where it just takes some time to bring on capacity but that capacity is being built. those are more transitory. but if you had to describe a world of some enflakes or a world of no inflation, as we look at you know reasonable period of time i believe there will be some inflation. >> can you maintain margins, jon, and the reason i am leading up to another question and we are seeing unilever has some overlapping products that you have and they see the need to maybe change their business and they're look at glaxo smith kline's consumer unit. would that make sense for procter & gamble and can you maintain margins >> on the marvin qgin question o recover the cost, not necessarily the commodity

increases. we're doing that with cost savings with positive mix and with some priceing, as we've talked about earlier then over time, our productivity efforts will allow us to rebuild not just recovery of commodity costs but the margin but that will take some time >> and - >> on the other question, on the other question, i'd make a couple points. the first and fundamentally the most important, we are very happy with our current portfolio. we made a big effort several years ago to focus our portfolio in daily use categories where performance drives brand choice. and at times like this, that's incredibly important and you've seen the breath of growth across the portfolio which is driven by a tightly

integrated strategy. so we have, in order to create value going forward, we have no need for a large acquisition the second point i'd make is we're committed to deliver our financial objectives, top, bottom line cash flow or organ organically. third point but least important is, you know this is a matter of policy, we don't comment on acquisition or divestitures. >> can you comment on whether you were alive the last time the bengals won a playoff game >> you know, joe, i just moved to cincinnati. the reds won the series. the benefitgals went to the supr bowl i thought i made the smartest decision on earth. i was in a sports mech cali mecca you know what happened after that. >> i realize it was on my

birthday. >> great to see for our city >> joe borough, in spite of mike brown, even mike brown can't ruin, i don't even want to say it, but joe borough and jim maur, that may break the curse >> you know, someone asked you yesterday whether you were going to get back on the train, you said no i just want to let you know, i got a seat right here, joe. you can get on any time. >> all right i may. i may. i guess we got to go thanks, john, we appreciate it >> when we come back with that quarterly build from morgan stanley. stick around time now for today's aflac trivia question -- before yesterday's acquisition announcement of activision blizzard, what was microsoft's alrgest de the answer when cnbc "squawk

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now the answer to today's aflac trivia question. before yesterday's acquisition

announceth of activision blizzard, what was the largest deal linkedin microsoft paid $26 billion for the professional networking site morgan stanley out with its results because we have the slow burnings today wilfred is back. he has more on that. >> reporter: yes, revenue basically inline, fractionally behind 14.5 billion, eps ahead $2.01. i want to j ump to the compensation and non-compensation expect. both below expectation compensation expense 5.5 billion. the forecast was for 6 billion and fawn compensation expense 4.1 become that's pretty much in line with forecast perhaps fractionally impacts ahead. overall expenses behind expectations number, on the revenue line, some interesting thing going

into institutional security business slightly different from the rivals equity trading is strong 2.9 billion. the forecast was for 2.4, up 13% year over year other capital markets equity trading the hardest area to perform. the fixed income trading like the others is down year over year theirs is down 13% investment banking was strong again up year over year only up 6% at 2.4 billion. their wealth management business is of course the goliath part of their business 6.3 billion that was where it was forecast to be. perhaps a fractionally disappointing on the margins 24.4%. the investment management a nice little beat 4.18 billion surprising to see it moving high it decline over 4% yesterday alongside goldman sachs because of that issue on high compensation expense bouncing

back 2% as their compensation expense comes in 5.5 billion, the forecast for 6 billion interest and we should take a look at bang of mortgage, too. obviously, those are the results you brought us a little bit ago. if we coullook up bank of america shares bac, guys, morgan stanley is now up by 3%. as will mentioned, bank of america up 3% too, all that weakness from goldman sachs, i don't know where goldman is trading, it was down 7% yesterday. but it was kind of weird, expectations were very high coming that this with the financials setting a if you record just about every day, including on friday, too >> well, both the two companies reported today if there is one factor that they both have that some of the others didn't have is that expense control. we need the hear more, morgan stanley will drop their debt for the forecast of the year at 8:15 the media call for bank of america just ban the i want to get on that next the analyst part of that doesn't start until 11:00. but both of those declined

sharply both yesterday and since their reporting last week back-to-back there >> will thanks so much we'll check in with you later in the meantime, the biden administration wanting to order at-home lab tests. we'll talk to the ceo of l labcore. we will speak to hans vestberg to talk about the delay of the 5g rollout what happens next, "squawk box" will be right back will be right back >> okay... yeah... oh. don't worry i got it! become an agent of innovation with invesco qqq

coming up, worrisome geopolitical troubles with russia and ukraine sending oil prices to a seven-year high. we will talk prices next and in the next hour, congressman kevin brady will discuss taxes, the economy and the president's first few years in office, already, time flies when you are having fun. qubo wl rht back. ly, i need a w wireless plan for my business, but all my employees need something different. oh, we can help with that. okay, imagine this. your mover, rob, he's on the scene and needs a plan with a mobile hotspot. we cut to downtown, your sales rep

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, welcome back to "squawk box," futures have moderated again we were up triple digits briefly, up 50, 45 points on the dow, nasdaq getting back a little yesterday's losses, up about 33 s&p up 10. a quick as toing to watch, exxon mobile rbc updating the stock to sector

perform to under perform with a price target of $90 per share. analysts saying overall tailwinds for the sector is one reason and a prolonged strong commodity cycle both make the stock attractive at current levels becky. >> oil prices hitting a seven-year high on tuesday, trading in the mid-$80 rage, ac range. joining us is jeff curry head of commoditytive research at goldman sachs. rich everythingle was on earlier talking the heightened tensions between russia, the united states, ukraine. everything that's happened with nato this is a serious point of inflexion. this is something that really matters right now. maybe we don't talk about it enough it certainly looks like it's getting picked up on when it comes to the global markets,

especially in the price of oil >> oh, we look at the movement the last couple of days. i want to emphasize it's driven by fundamentals, not the geopolitical risks now the market is much more vulnerable today to these geopolitical risks than ever before in this cycle because inventories are so low so the very tight fundamentals makes the market very exposed to these events at this point these geopolitical events hasn't led to disruption of supplies of oil around the world. i think it's important to emphasize a lot of the risks that created that big pullback, black friday back in november of last year have all turned out not to have impact on demand, whether it was onmicron, spr, demand remains strong, the iea flip-flopped on their weak demand forecast and put out a much more bullish outlook on

demand right now which once scores how tight this market s. i want to point out this market is fundamentally tight demand is above supply still we don't have adequate supplies to cover this demand growth. our target the second half of this year is over 100 at 105 >> in terms of fixing the supply fixture, could opec and russia exit this somewhat if they wanted to? or do they like prices where they are if. >> you look at the world right now, there are only two producers who can produce more today than they could in january of 2 2020 before covid struck russia struggles to hit the opec struggle to growth supplies. the u.s. is nearly 1.8 million barrels below the january 2020 levels so what it indicates is that opec, russia outside of a select

few producers do not have the capacity to be able to meet these higher demand levels, which is why inventories are likely to drop the very first quarter and create a lot of upside price risk. our forecasts are now well above 100 at 105 which underscores the risks here >> 105 for this quarter or this year >> for necks for this year, 105 next year. we expect it to reach 100 july/august time period. i want to emphasize the risks are screwed to the upside. given the fact you don't have a lot of investors in this market. which means you can get financial flows on top of relatively tight fundamentals. that's an important point is that investors for the most part have shunned this space. look at the market cap, it's running somewhere around 5%. the energy sector. but overall, you know, excuse me, the earnings are running

around 5%. the market cap is somewhere around 3, which tells you, you know, investor's interest in this space is very weak. >> right we have the ceo of exxonmobile on yesterday talking about their plans for being net zero by 2050 that's not to say they're not gentleman to stop producing oil and gas, probably more of their capex dollars will go toward some of the free initiatives rather than new places. >> the other thing not only you see capital redirected into green kind of capex projects, but also what's happening is that esg raises the cost to capital or that hurdle rated in which you get investment part of the reason we haven't seen a surge in capex drilling and investment with these price levels on oil is that that hurdle rated is much higher. we're going to find out just how high that hurdle rate is over the course of this year. but what we do know, it's higher

than current levels. >> that's what we talked about the last time you were on, the idea when all of a sudden profits overtake principles at some point and it becomes a more attractive level if it's not $86 a beryl. is it 90 sit 100? what do you ung? >> our base case which was why we updated our forecast earlier this week and we expected to have to get over 100 towards the second half of this year is we think it's somewhere in that at 95 to 105 range, but that's speculation still. we don't know. you don't actually know until you observe it there could be a lot more stick jixness to this whether in bank financing throughout the entire financial system we will find out what price it requires to get half of the flow like i say, it's not about the supply and demand of the barrels of oil, it's about the supply and demand the capital used to produce those barrels of oil, that's where the bottlenecks are. >> jeff good to see you as always thank you. >> excellent

thank you for having me. coming up the ceo of labcorp, a big surge in testing for the omicron variant. he will join us after a break. later verizon ceo hans vestberg, the face-off with the airlines and much more. "sawbo icongigquk x"s mi rht back d label is taking off. but so is your sound engineer. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire

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deviseing a new system to order on websites you can get four tests per household. it's conducting that through the u.s. postal service. joining us to discuss more is lab core ceo adam schecter good to see you. i'm curious how you think this is going to change the dynamic and if it will at all? >> good morning, andrew, it's a pleasure to be here again. the first thing i will say is we certainly see a surge in demand for testing, starting about the middle of december the pcr tests we have been able to keep up the average results is under two days think we need more and these are at-home rapid tests will add significantly to what we need in the marketplace f. people want to go visit friends or family or want to see parents that may or may not mr. in a nursing home, it will be great to have more tests available in the mark place. >> one of the complications with

at-home rapid tests as we all very know is it's harder to track in terms of understanding what kind of spread there is inside the community because people don't report. is that something we should be concerned about in. >> i think we're able to track a lot of the tests right now, the majority of the tests with edo in labcorp are for people that have symptoms or have been exposed to covid you photo your doctor, urgent care, many pharmacies, those we track very closely i do agree we have to be careful with so many of the rapid tests to track the disease we have to encourage people to report if they're positive. >> in terms of public policy and in investing in testing one of the things that happened a year ago was there a sort of a huge ramp up and once the vaccine emerged and things were quite escent you had abbott and other throwing the tests away.

we didn't have enough of them. once we fet through this omicron period, do have you any concern people are not -- i don't want zo to say people, does the deposit need to do something >> first thing i will say is labcorp back in the summer of last year we were only doing 30,000 tests per day right now we're doing 125,000 to 175,000. we made the decision at that time to keep our capacity where it was to keep all our lants open and running because we didn't know what was going to happen in the fall or winter i'm glad we did. that's why we were able to keep our turn-around times below two days on average right now. what i say moving forward is we have to continue to have capacity available i think there may be good public partnerships, where we are encouraged to ensure capacity is still there if we feed it. i think we have learned a lot as we see the virus continue to evolve and what happens with these variants so i think all of the testing companies have to continue to

have capacity available because we don't know what will happen this time next year. >> hey, adam, quick question for you, tom bevin this morning the founder of real clear politics tweeted out something about one of his kids saying the tests they were all supposed to get this week, they're not going to get because the government reallocated all the supplies from the testing companies to meet this new initiative of free at-home tests. i hadn't thought about it, maybe they don't materialize, you have to take and rejuggle where they're going and redistribute them from other locations. is that the case or are th demand the federal government is now planning to send out >> so i do think they are ramping up as fast as they possibly can labcorp doesn't do the at-home tests. we have and at-home collection kit. i know the manufacturers that

have those tests, they're doing everything they can. they're running the manufacturing plants seven days a week, 24 hours a day i think we will see more and more supply available as the next weeks come on >> the new pfizer therapeutic, which hopefully will be at scale soon and available, effectively rears people to take it very early on in you know after getting symptoms or becoming positive having said that you need to be able to be tested to get the answer early to make these drugs work so when you start to think about where we are, for example, next fall, what do you think we need to do as a country in terms of making testing available a price point to make this work, how quickly it comes back? and all of that? and are we prepared? >> the first thing i say, andrew, when i was on this show two years ago, you asked me whether or not i thought there would be a vaccine in 12-to-18 months i said i thought it was highly

unlikely it's important to realize how far we've come the fact that we have multiple vaccines and multiple treatments that could be available is truly remarkable now we have to make sure we put these to really food use in terms of testing, if we can turn around the tests one-to-two days on average, i think that's fast enough to allow the new anti-virals in the marketplace to be used as appropriate. we have to continue to make sure even in the summer we see a number of tests that we continue to make sure we are prepared for whatever happens in the winter of next year >> what about the price point? because a pcr test today as you know is a very expensive endeavor for most persons and even a rapid tested, if they're being used regularly look, this morning i had to do a rapid test i'm in walk, i can't be masked given what i am doing. i think a lot of workplaces are starting to think about how to

use rapid tests potentially on a daily basis f. you do that, the price point literally has to be 1, 2, $3 it can't be 20, 50, 80 or a pcr tests in some cases costing over $300. >>ive will start with labcorp. since the beginning of the pandemic, we haven't charged anybody any up front or out of pocket costs for people that met the cpr guidelines, they had symptoms, were exposed to people there was no cost to them at all. we charged the insurance companies for them we will continue to do that as we have done in the past i think as more competition is in the marketplace through rapid tests, as there is more and more volume available, but what we've seen in other countries is the pre-mark allows the price to continue to do down over time. >> adam, i want to thank you we wish you a lot of luck. do you important work for this country right now. so thank you. >> thank you thanks to all my colleagues at labcorp. it's a pleasure being here.

>> joe coming up, the latest out of washington with congressman kevin brady. plus our exclusive interview with verizon ceo hans vestberg to talk the delayed 5g rollout stay tuned "squawk box" will be right back.

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good morning, bond yields creeping higher, but this time futures are holding up we are looking at a calmer open after the dow's worst day in close to two months. meanwhile, more big-time earnings rolling in. we will bring the biggest numbers from bank of america and morgan stanley today why were giants supposed to make the flip on 5g around the country some towers won't be lighting up because of safety concerns from the faa. coming up, we will hear exclusively from verizon's ceo hans vestberg on a slightly nationwide challenge the final hour of "squawk box" begins right now >> good morning, welcome back to "squawk box" here on cnbc live

from the nasdaq market site in time's square. i'm joe kernon along with becky quick and andrew ross sorkin andrew is in washington with a capital extension interview with fcc chair lina khan. at this point they're up almost triple digits. they did at one point cross over we are up over 100 points at one time, even though bond yields continue to trend higher we did see a 1.9 on the ten year even over in germany, we actually had a positive yield on a ten-year boone the first in almost three years. the first time you could actually get some interests on a bond, actually coming back to you instead of the other way around, which is unbelievable. but, who knows maybe we had the 2%.

we're pretending we will have the 2% i did hear, you know, this guy, tougher waiting to hear from him. what can he say now? i did hear from him last night, guys he said, what did he say i think he just wants me to stroke him or something. he said, did i mention that we are over 1.7%? and then he sent a year something from last march when he said it's going to be stable. it was at 1.7, remember? >> yes. >> he said it will be stable a period of months and the result. he was bullish so now he said, did i mention so, i said -- >> that's fought from here. >> i said, do you have something to say because i'm here but he apparently does not have something to say >> he bubbles and then stops >> are you ready to yell fire in a crowded movie theater? is that what you are ready to do now we're at 1.9 i don't know what he is thinking if he does, i will tell you.

it's more of a hey, did you notice, you know, it's been since prul that april when i sat >> so he was bragging. >> he certainly was. >> in different ways >> he was wrong about the carolina panthers and the steelers >> for our audience, his calls on the bond mark and the stockmarket is a little more. >> i'm trying to nudge him i don't know what to expect. i don't know how he feels. i would like to know, because we're at, are we at a turning point? we might be or at least an important point in terms of with rates rising and everything else >> but we're at a little bit of a turning point. i guess. >> i can't get it to ring because mine does not have a mute switch on it. as you see in the commercial for geico. have you seen that, mine doesn't and everybody has one. you know i do have one. i haven't seen it. huh? >> i haven't seen it

you watch more tv than all of us combined >> we're in the tv business. you haven't seen, you turn it into your parents? you haven't seen any of those commercials? >> i have seen turning it into the parents. i haven't seen the mute button >> they say we will do a tdf, everybody goes, no, no open up a pdf. >> we're there we are we should tell you two more of america's big banks reported earnings this morning. wilfred frost is here. he has a wrap-up of the big numbers. >> becky, so now of the big six are in and somewhat surprisingly, the big differentiating factor for banks this quarter has been costs within the retail banks, banks of america, wells fargo did well, j.p. morgan did not. in the investment banks, jp morgan missed on costs they could bring it back under control if the year ahead isn't so strong. morgan stan by beat on

expectations on compensation costs. we haven't gotten their year ahead on that. the other big take away is net income is improveing not quite as fast as people have hoped, more of a show-me story in investor's eyes, the share prices in the first couple weeks of january have perhaps run up a bit too aggressively on that point. loan growth is interesting bank of america suggested they're doing well on that point. we look forward to speaking to brian moynihan on that topic and closing bell today within capital market, investment banking still remarkably strong with comments from various earnings school, though the backlog is not too bad either wradz, trading revenues are coming off the recent highs, though, morgan stanley did well on equity trading specifically all of the banks up today after all declining sharply yesterday, bank of america, morgan stanley up the most because of some of those positive factors if their numbers this morning, guys >> will thank you.

just under 90 minutes to go on the opening bell on wall street. dom chu is here. he's got to look at the other big movers we seen in the pre-marks, what's up >> some of the non-bank once and specifically dow components, you see that 95-point rise in the dow on the bottom of the screen with a ticker. let's talk about p&g's contribution $2 on the upside, 14 points for the 95 point upside in the dow. proctor&gamble pampers, bounty, paper towels just about everything else out there up 1 and a third percent. they raised their forecast for a key measure organic sales growth that's helping to push those higher procter & gamble up 90%. that's a laggard, by the way, still, helping the dow case out today. another one more than important, arguably, ba u.s. it is the most heavily-weighted number of the dow jones industrial average is unitedhealth group up roughly

9% it's up one-third of 1%. just about call it eight, nine points it comes out you fiunited healt thanks in part to optum, which does medical practice management, that sort of thing united help up 41% over the last year that will be a contribution a. check on the most popular ticker from yesterday's full session. maybe no surprise that banks are a big part of that list. goldman sachs was one of the last s. activision, sofi after it gets approval to sxchange in a bank holding position. what's interesting, andrew, is what i will tell you, one thing i didn't see coming. the number 11-most searched ticker is the nasdaq 100 futures. so a lot of people scrutinizing that nasdaq trade right now on the future side of things and one thing i don't see very

often, number 36 on the list, the two-year treasury note yield cracked the top 50 the first time in recent memory i've seen that, andrew >> very smart viewers i think on that website absolutely dom, thank you for that. we got a lot coming up we've heard about the concerns about the new 5g wireless, one of the key players from verizon ceo hans vestberg. next, looking ahead to year two. we got a live report and texas congressman kevin brady will join us. stay tuned you are watching "squawk box" on cnbc

president biden is about to begin his second year in office. as he does, he is battling tough head winds kayla tausche joins us with more on that. >> reporter: good morning, retail sales soaring after stimulus, consumer confidence spiking. while those areas have since labelled off, jobless rate cut nearly in half to 3.9, a stat cited daily by the white house the cnbc polls were optimistic,

casting a shadow on all of that strength is inflation. climbing throughout the year, dragging president biden's approval down with it as the supply chain broke down and they passed higher labor costs on to consumers. why did they fail to tamper it down earlyen administration officials said they were too focused on vaccinations and averts worst case economic scenarios and a difference to the federal reserve but messaging on inflation. the vote, say president biden isn't doing enough to fix it a. poll from this weekend, 63% of voters said their view of the president would improve if he did fix inflation. just 24% say their view would improve if he passed his landmark social spending bill. as the reset is under way, the white house still trusted inflation will level off by the end of this year

mid- voters may have their say before then. becky. >> you mentioned administration officials pointed out their difference for the federal reserve but every administration had issues with the federal reserve and tries to raise rates a. lot of presidents have blamed the federal reserve when those problems come along. will that difference continue as the federal reserve looks to step up rates and fight the battle against inflation >> reporter: yeah, beckley, i think it will until the federal reserve gets staffed up with nominees tlt white house doesn't want to draw too much attention. they want to install them quietly and get down to business and follow through on their own priorities and agenda, getting the economy in order there has never been a former chair, the leading economic arm of the executive branch until there has been some discussion

of whether that has created a new and interesting dynamic where it's levied the administration to be more differential to the fed. that's an issue we will explore a little further. >> kayla, thank you. for more now on the economy and what he thinks the government can do to support it in the years ahead, we want to bring in texas congressman kevin brady, on the house, ways and means committee good morning to you, congressman you heard the report from kayla tausche. we are now a year in so we can look at the economy and i know you have some very critical views about it. but i wanted to ask you about this quote this is in the hill. this is not from you, but from somebody else this morning this is matt bennett, the co-founder of what is described as a centrist think tank third way. he said, quote, if trump had this economy, he'd be calling it the greatest ever. yes, there is high inflation low unemployment and a booming stockmarket. i think they, meaning the administration need to be more aggressive of addressing things

people care about and know what the biden administration has achieved do you think that's right? >> not necessarily first, andrew, good to see you, happy new year thanks for having me back. >> happy new year to you. >> look, the problem is in the biden messaging. the problem is biden's policy, themselves look, i believe he fumbled this economic recovery. he inherited a better than expected recovery from 20. there were trillions of dollars of stimulus, a life saving vaccine and much of the regions finally reopening as a country, it should have been a very strong year. he's missed all three quarters of the economic projection he's a million jobs short of his promises from the covid stimulus you know the wage increases or the inflation increases were so much last year, he gained back two years of real wage growth for most americans and his policies actually made the labor shortage or crisis worse so, look, i feel like, you know,

using a baseball analogy, president biden began his presidency standing on third base and he proudly stole 2nd. and i this i the biggest change you could make starting with the right now here on his one-year anniversary is the course correct? stop pursuing the policies like major tax hikes on job trait e traders and investors in america that have created a great deal of uncertainty certainly and have an impact on the pressing inflation. >> the real question, though, i would argue to you is, look, we can debated what's happened in terms of build back better and all these other plans, isn't so much of what's facing americans today is a product of inflation and, frankly, a product of the federal reserve? and so the question is, is there too much definition to the federal reserve? maybe the idea is janet yellen is deferring too much to j. powell j. powell was an appointee

originally under president trump. do you think he is doing a good job? these are some of the real questions here >> i don't think you can use the excuse or the fed as an excuse yes, they partnered with the biden administration on more stimulus spending. they did really deny the impact or how serious inflation in the labor crisis was as you recall despite so many small businesses telling them, there is a huge problem here, so, yeah, the fed is a bad actor in this. but look joe biden came out of the gate, took his eye off covid testing in therapies and treatments immediately, proposed major tax increases. and his policies, if you recall, andrew,made the labor crisis work because two of his major policy discouraged americans from recorrect hecking to work t the work force as we need them i don't think they can pass this off to the if ed. >> from a policy perspective

today, practically speaking, take the fed out of it, what do you think has happened in washington where there will be bipartisan support that would arrest inflation to the extent you believe that's possible? >> yes so a couple things one you know stop doing things to make it work. so you know, you la i the build back better aside because it had several policies that would make the labor crisis even worse going forward. that would be a good step i think. secondly, drop the tax hikes, the uncertainty really the sort of the chilling everything on u.s. investors i think it would be very help. work with republicans on reconnecting workers to jobs the matter is we are desperate, small businesses are desperate, main street business is desperate for workers. we proposed innovative ideas, return to work, focus on the main street job shortages. i think that would be hugely help i also think from an economic

standpoint, the president is standing on the sidelines while the rest of the world, china, europe, japan, others, are aggressively cutting trade agreements that differently up the world commerce while america is standing on the side line there is an area bipartisan or building off the work we did off the usmca together i think there are some things we can do together. i will work with the president on some of those issues. >> congressman, we got oil at multi-year highs we got people tweeting that this is really good and it's what the biden administration wants to try to transition away from hydro carbons. that definitely was in the control of the biden administration what happened in to some extent in the energy patch. don't you think? and -- >> yeah. >> do you ascribe any validity to that theory they don't mind i can't imagine any administration wants oil prices to go up >> i don't know how that works

i can't imagine that being the case except for this, the tenets of the old new green deal climate change are wrong on their parts two. parts, one drive up energy prices on everyone as high as possible to discourage them from using it to get rid of all the oil and gas jobs i think that is the path to the biden administration took and is taking i think that's the wrong approach we ought to focus on the innovation that would allow to us create affordable energy and make it more cleaner i think that's a real solution yeah, i think there is no question they drove up prices by constraining production here in the u.s. >>ing o. congressman brady, i want to thank you. appreciate it. good to see you. and we will have you back soon to talk about this meantime, when we come back, we will be live with verizon ceo hans vestberg an interview you don't want to miss on a day when wireless service gets switched on but there is a big catch involving u.s. air carriers and

we got that interview you got to see. tomorrow, we will be joined by the ceos of both american and united airlines. stay tuned you are watching "squawk box" on cnbc

. welcome back to "squawk box. futures up over 100 again, triple digit gains we are seeing, they're some of the

biggest pre-market winners we are seeing in the dow, which is responsible for moving it up p&g up almost 2% microsoft. caterpillar, goldman sax rebounding a little bit there morning. here are some of the stories investors might be talking about today. japan listed shares of sony close to 13% following yesterday's news that microsoft is going to buy activision the game publisher activision blizzard for about $80 billion, the biggest players of consol gaming activision ceo bobby to tick could get a pay day of $390 million. most comes from the 4 million activision shares he owns. the gains that we are seeing in those shares in other news, ford says it will get more than an $8 billion bump

thanks to investment in ev maker rivian which soared in its debut. the stocks at this point down about 60% from the post-ipo highs. coming up, breaking housing data, plus an interview with verizon ceo hans vestberg. stay tuned you are watching "squawk box" on cnbc cnbc >>matching your job description. visit indeed.com/hire ♪ ♪ wow, we're crunching tons of polygons here! what's going on? where's regina? hi, i'm ladonna. i invest in invesco qqq, a fund that gives me access to the nasdaq-100 innovations, like real time cgi. okay... yeah... oh. don't worry i got it! become an agent of innovation with invesco qqq

. welcome back, everybody. let's take a look at the futures. again dow futures indicated up by 134 points. s&p up by 25 the fax indicated up by 121. this is after a big down day yesterday. the fax was down 386 points yesterday as yields continued to rise yesterday the ten year was at its highest level of january, 2020, 1.87%. you will see the ten year at 1.861% oil prices yesterday seven-year high 87.51. this morning on a new contract that we're watching, you see up to 86.01 up from where the contract was yesterday. brent crude up as well 88.04

if you have been watching cryp prices bitcoin up 1.5% at 42, are 464. we are a few second say way if new housing starts we have been awaiting rick santelli has been standing by in chicago at the cme these will be interesting numbers, as the ten year has climbed. the 30-ier picking up yesterday as well. >> yes, it's going to have to compete against several other very large scale variables to really leverage which is going to be most important we know there is an inventory issue with regard to housing we know there is a pricing issue. prices are awful lofty we know that home equivalent rent has been zooming, even though it's a smaller dynamic in many way as housing prices, yes, the correlation between interest rates and mortgages, seven years the life of a mortgage, if you

look where seven-year rates are right now, they're right around 180 up dramatically just like all other interest rates many just kind of lazily look at the ten year as the major benchmark on the real estate market i think that ultimately with regard to housing, history is still being read relatively kind when you look back to the early '80s we're comping inflation mortgage rates were back in the 'teens, here we go, december release of housing starts. the final housing number of the year 1 million 702,000 1.702 million seasonallied a judd annualized units. this is surprising considering last month we have a month-over-month change of close to 12% this is a strong number. if we look at permits 1.873 pm so 1 million 873,000 permits seasonallied a judd and annualized another burn-busting number.

these are very, very strong. then we can, of course, argue with respect to how things break down on the permit side between multi-dwelling and single family homes. i understand that those dynamic es have been affected pre, during and post-covid, ultimately housing is hot. i saw the headline earlier, the biden administration looks for inflation to level off trust me, leveling off is not going to take the pressure off the biden administration because leveling off means that prices may stop going up at their record pace, but they will hover at levels we haven't seen in decades. and that's the biggest issue i think with many out there, interest rates right now, we're at 186 and 10 which is a long ways down from the 190 high and we only have, only have 9 trillion negative securities around the globe that is down about half of what it was at the worst levels much of this, of course, because of the focus on ten-year

sovereigns across the globe, moving in positive territory the catalyst, the focal point, of course, being boone yields the first time in 32 months eechd .02% wow! to think that for that long banks and people had to suffer by giving tear money to a bank and being penalized to do so, really i think makes one scratch their heads and question how monetary policy in europe can possibly turn out in a good way. andrew, back to you. you are in the capital of where all this is being decided. >> i am in the capital where all this is being decide the question, i know where they will kill me did you hear the kevin brady interview? i'm curious what you would do about inflation given what we are seeing here. policy, not what the fed can do? >> well, there is very little that can be done as a matter of fact, i think the problem is, is that politics have seeped into this in such a large way, with enow have, of

course, this transmission line between the biden administration, of course, and the fed and all this about raising rates, be aggressive, control inflation. listen, i get it the fed stood too long the current administration spent too large at times and this money hasn't really been directed at covid. it was a wish list based on history. but my point andrew here is much of that money hasn't been spent. i think the key issue here is that the federal reserve by raising interest rates is not going to address many areas of inflation that have moved out of control. think energy here. raising interest rates isn't going to do anything about energy prices. you're sitting in the city in the district of colombia that can affect those prices by, of course, acting much more rational about the state of fuel outside of the fossil fuel renewables when are they going to be ready for prime time think about this

do we have to subs size amazon do we have to subsidize google where do we have to subsidize renewable energy because it's not ready for prime time >> a longer discussion always an insightful one rick, thank you. we will talk about all those issues here in wuk coming up, will 5g wireless be disruptive to airlines in the nation that is the question we will talk to someone at the center of this controversy rorz ceo hans vestberg. that is coming up next "squawk" we'll be right back yea! why is jerry so... popular? it's been like this ever since we started using workday. what do you mean? it makes it easier to develop great relationships with our suppliers. now everyone, everywhere loves jerry. they sure do. they do. they really do. mmhmm. workday. finance, hr, planning and spend management for a changing world.

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verizon and at&t saying they'll delay deployment of 5g at towers near some airports in the united states after the faa warned of potential equipment interference, said airlines said they would have to cancel some flights because of it, despite the last-minute 5g delay, some inbound flights overseas are already being scrubbed julia boorstin joins us as a special guest. good morning >> good morning, joe yes, i am joined by verizon ceo hans vestberg. hans, thanks for joining us in an exclusive interview as you roll out 5g to most of the country. let's start off with this concession the faa to delay 5g around airports. i know you have delayed multiple times. sawty technology is safe and other countries are already

using similar technology but the airline pilots association wants more assurances and as joe just mentioned, some airlines are already canceling flights and blaming this deployment of 5g. how long are you going to wait before you roll out nationwide >> first of all, we need the celebrate what we are really doing today. i think it's a great day for the u.s. economy a great day for all of verizon commerce, a great day for verizon, because we are turning unour c-band today more than 90 people in the united states will have coverage in more than 1,760 so that's really what i am excited about. but you are also right, you are talking in some places, in a small portion of network we are not turning on close to airports that has been our discussion with the airlines this week to see we're having safe flights. so they have time to go through the technology and the frequencies and all of that. and they're doing.

i am confident it's going to go fast they are very focused. we have seen a good collaboration the last couple weeks to do this in a way. it's a small portion of the fourth quarter the big thing is we launched the network. it's a great network fantastic over 1 big gakally on the mobile phone now going around the country. this is just the beginning we are excited for that hopefully, our customers are a grateful economy broadband and wireless is such an important infrastructure for this country >> and certainly 5g is something i know have you invested a lot in it's something we have been talking about for a while. but the fact, you have to hold back in this 10% of the market that is near those airports. have off set a deadline with the faa or with airlines when you said, guys, we're going to launch in a month. we're turning it on fully in an moth do you have a sense when this will be fully resolved >> at the first we have done

this voluntary because we believe it's important that all this airline industry and faa really understand and doing the right things because we all are flying. i am flying. my family is flying. so we want the to be in the right way. i have assurance on the highest we feel, this is the main priority for them to sort out. i am dedicated my technology to do it. it's a small portion on the network. the more important is the rest of the network is turned on. wherever are you in those 1,700 cities today, you are getting the 5g broadband from verizon, which is a game changer. >> yeah. it sounds like you don't have a clear sense when that final 10% will turn on i am wondering, more broadly, this is something verizon has invested so much in. you have been working towards this launch. i know you had to delay it as a part of the conversations with the faa. are you concerned the delays and headlines could hamper consumer

interest if upgrading to 5g? >> no, i think the consumers, hopefully, understand we areic thating this materially. that's why we have delayed the launch and knocked power out, some of the main stations at the airports today so i think that consumers should understand we are taking that equally serious and as i said, we're all applying we want to see they feel really safe about this. remember, this frequencies are using more than 40 countries where aircraft are landing every day today. so it's a matter of time to work this through >> hans, it's becky. we heard earlier today from a former airline ceo saying a part of the relationship, i was confused, this has been rolled out in other countries, there hasn't been a problem. he was saying it's stronger bandwidth. a couple of questions. is is this a question of time or is this a question of

technology is it going to be a matter of time and sure everything is okay because there is not these technological problems second of all, do you want your money book from the se what did you spends like 40 billion on this spectrum >> first of all, it's time technology, it's the same frequency all around the planet. the experts need to be discuss this rather than people like me doing the check between the frequencies. remember before spectrum was auction, it was enormous work to review and do analysis of this spectrumful it's not like this hasn't been done before so that's one when it comes to getting.book from the government, that's nothing we are immediately discussing at the moment we are in collaboration with our part first, including the white house, so that this is cleared out. i have high hopes this will not be on isan issue for a long tim

>> hans, how would you personally. >> hey. >> it's andrew, how would you feel flying an airplane fear one of these towers right now? >> very good >> so what do you tell your friend in the airline business >> no, we, like i said, we have our collaboration. we are a different type of speeds on how we are reviewing technology they are a big industry. there are many people that needs to do it we need to take the time so they feel good about the technology all of that that's happening and the faa is involved in all of my technicians are involved in, because that's where the discussion is happening. so that's what's happening and the collaboration is good. >> can you go 30,000 feet for us, not to use an airline phrase and explain how you got here, given what seems, you think everybody would have known for as long as we have and here we are in this sort of very unusual spot >> it's a great question i don't think you should ask me.

i think you should ask them how we got there so i don't know. for us, i think we have done everything right we bought the spectrum that's been an extensive research on the spectrum portion also >> you must have a view of what's happened inside the faa, inside these airlines. you were in, by the way, the cell phone business was in a big battle for years with the airlines and faa over whether you could use your phone while the plane was taxiing if you remember >> yeah. i remember that. no, it's not for me to have any opinions about things that i don't 16% and know what's happening. i leave that to if othe ones on that question. it's a good question. >> i think andrew is getting at. you bought it from pun part of the go you spent a lot of money in huge technology it's been clear you have been getting 35 g5g ready and another

part of the government is telling, you you can't launch. you must be frustrated one is buy this technology, do things with it the other is saying, wait, you can't launch it, it's fought safe >> no, our job is, of course, to see that the flight safety is there. also the answer are getting 5g off the broadbands that is what we are doing here it is more a portion of the radio network that we have been and are powering up. because we are going through absolutely the right thing to know and we are working with everybody in order to see that all the customers we have all the people that are flying, feel good about 5g. so i think that's what i am focused on you know as the leader of this company, we are really proud of the day today. our strategic changes last year was fantastic. we bought the spectrum

we are launching the spectrum, basically a quarter ahead. we added 20 million subscribers. i think for us this is great we are redefining what verizon is i am proud my team is proud that's what we are focused on. that's a portion of the network not powering up for good reason. that collaboration will continue i'm not frustrated is. i am happy i am excited i think we are in a great moment in the industry and super well position in the market >> you sound very patient, hans, as this issue has taken a while. >> i'm a super patient guy i'm a super patient guy. >> you started off the conversation saying today was an important day for the economy and 5g is important for the economy. i know that's been a part of your message to the government that we need the figure out how to deploy 5g because this is an economic imperative why is 5g so essential and how

do you see it being so transformative >> no, first of all, we have a lot of things we saw yesterday, for example, with metaversion, all of that you cannot do metaverse without verizon today. all after that, that's one thing. not only that today i am powering up or covering 9 million households where residential broadboond as well, so suddenly i can do broadband, metaverse, consumer business enterprise and mobile edge compute. so all of that is happening. all is driving where the economy is going more daylight, more online in order for everybody to have the equal chance wherever they are and whoever they are live. that's so important and that's what we are doing. >> well, certainly, you can have something churning and takeing

alert in the metaverse thank you, on the big day you roll out 90% of your 5g network. >> thank you very much. >> enjoy it. thank you. let's go down to the new york stock exchange, check in with jim cramer. hey, jim, let's talk about what happened yesterday in the markets with technology shares under such pressure, after you saw yields rise. you were looking at the nasdaq i think it closed below its 200-moving day average of april 2020 how big of a technical issue is that what do you think is happening next >> look, i think it's an opportunity. i think there are two nasdaqs, one created in 2018 and the ones that are standard and good i think they will have great quarters but they're not differentiating right now. i look at any company that became public since 2018, we almost want to sell all of them to pre-revenue, the whole area is adverse since 2000 a. lot of the companies came down

yesterday becky were really good companies. i think you have to start buying them we talked about airbnb it's a profitable company. >> yeah. >> it shouldn't be bunched in with a lot of other clown companies, certainly spacs, which were hilarious >> what about companies like semi conductors? applied materials down almost 9% semi conductors took it hard communication companies took it hard a. lot are good companies >> asml reported last night, the chinese were aloud to have any, if we were blocking the chinese, they were completely sold through. some said they missed their numbers. how do you miss your numbers you are a soldout company. i think that lam research has far more business than it can hand him the issue if are you the secretary of commerce is how do you get lam research to work 25 hours a day? so these companies, suddenly there are no chip shortage these are made-up things

the stories how everybody is fighting over bankers, that's completely untrue story. you know if are you goldman sachs, you are turning down people that want to work there left and right so there is a lot of untrue narratives going on solely because of the ten year and the reason why we're making why we'- i did a lot of work on goldman yesterday. i used to help figure out compensation goldman is pretty much in charge of compensation. the idea they're somehow paying people more, i think makes sense. bank of america will maybe -- you can't have it both wears the bears are saying if they raise it four times it's bad for bank of america, if they don't, it's bad for bank of america so i kind of rebel against half the narratives i'm hearing i don't rebel against the ideas that the russians will --

ukraine, but against the money that bank of america made today? it's extraordinary so we can sell all of these and say it's the ten year, ten year, ten year, but moor, they're on the ground doing so well, why do i -- >> i love that narrative, jim, pointing out you can't have it both ways. i can't. >> if the economy is good, people are paying off loans, stores "american idol" in their savings accounts, yeah >> look, one thing if you get 100 basis points more for your checking account, but they're guaranteed 1% more, and that's $6 billion that's $6 billion that just happens when they turn the lights on. yeah, it's easy to be negative because you're scared, because there are troops on the ukraine

border and oil might go to 100, but we have to start thinking about individual companies warren buffer phet is probably sitting there laughing. >> and because they're not going to -- tism jim, this is a theme we will definitely tune in to hear more about in a few minutes. >> it's our morning meeting we do now for the investment club, we talk about the absurdity, but you start seeing stocks down, you make up reasons. that's what people do. i'm not going to make up reasons. we'll see you in a few minutes. "squawk box" will be right back

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a. welcome back to "squawk box. i'm live in washington for a special event at 10:00 a.m. eastern time fed chair, lina khan first on cond television since taking the job? she'll get joining cara swisher and me, and you can warble the

special edition on your second screen at cnbc.com/cantexchange at 10:00 a.m. eastern time we'll bring you all the headlines, and of course tomorrow on squawk joy? >> this you want me to watch >> absolutely. >> i'm watching too much tv. should i make an exception >> get your ipad out you can have a couple things going on in this new world just keep the volume on us >> all right will do. back to the markets now, jason trender, ceo of strategis, a behr company well, the fed says it's not transitory they told us they're on the case they're going to raise rates a few times, do qt, are you feeling good are you feeling relaxed? they're on the case. >> joe, i have to say, not

really the fact of the mac is the fed is still easing. the fed is still purchasing about $40 billion a month tro treasury securities. after inflation, depending on what you're using is minus seven. if you use the core pce, which the fed uses, it's minus 4 1/2 i've been doing a lot of read being the great inflation, and one of the things i've learned, if history has taught us anything, it's like a home project. it takes longer and costs more than you think to get ahold of these things i never felt it was transitory from the beginning

h.w. thinking he lost the election because of it got politicized. it's easy to do that it's getting very politicized at this point >> well, joe, that's very true president nixon, took obviously with miller the head of th federal reserve. it should be independent, but you know, it's in the ecosphere of washington. it's hard for it not to be politicized. i think it will be particularly hard, given the new candidates for the fed and what they want to do when they're on the fed, which is to address things like social justice, climate change, which are noble goals, but i feel strongly are well outside

confidence or the ability of the fed to influence >> we've got 40 seconds, jason >> okay. >> so they're going to be feckless and not handle it is that bad for the market 40 seconds. >> it's good for certain sectors. it's not good for all of the market tech, as a whole, as jim were saying before, there are parts that are trading expensive, but other parts, like energy, financials, that will benefit from the februacklessness i hope i'm wrong, but i'm going to reserve judgment. >> you don't expect supply chain disruptions when they go away. you think we're behind the eight ball and in a tough spot >> they'll ease a bit, but there are things like rents, wages and our environmental policies,

which are going to keep inflation higher, longer than i think we want. >> all right that's a nice soft shot you got there, trender, your hair looks fluffy and nice. thanks for being on with us today. >> my pleasure. tune into andrew at 10:00 a.m. >> streaming is the future >> i know how to do that, netflix, right make sure you join us -- >> peacock. -- tomorrow. next is "squawk on the street. good wednesday morning, welcome to "squawk on the street." i'm carl quintanilla, with jim cramer and david faber looking a bit better than tuesday. that