"squawk box" begins right now. good morning welcome to "squawk box" here on cnbc when i say welcome, welcome, brian sullivan good to see you. >> thank you very much good to be here. >> good to see you joe and andrew are off today what we saw yesterday was really something to behold. check out the equity futures they are not bouncing back no relief with the dow futures indicated down by 108 points s&p is off by 18 and nasdaq off by 81. that comes after the selloff on wall street. dow down 526 points. that's 1.5%. s&p down by 1.8%

the nasdaq was the biggest loser. down 2.1%. this was all happening as people saw the cpi number and heard the fed president bullard saying he is expecting rate hikes to be sharper than people anticipating he was talking about 50 basis points in march and 100 by july. that caused pressure in the markets. maybe the most pressure coming when with we look at the treasury market. ten-year yield is above 2% the two-year jumped more it is now sitting at 1.596%. brian, it is the spread between the two-year and the ten-year that really got a lot of an atte attention. you will look at the squawk stack. it got down to 44 basis points yesterday. before the cpi number, it was above 50 this was significant movement.

two-year and ten-year spread sitting at 40 basis points that is incredible to see that movement and see it happen that quickly. the volatility index was up yesterday. you are talking about 24 it is up another 3.5% this morning. it gained four points yesterday. russell 2000 small stocks down 1.5% yesterday. if you are looking at it for the week to date up 2.4% 16.5% off the all-time high. the concern with inflation like this is smaller companies can't pass on the costs quickly as bigger companies russell 2000 has been under pressure real estate was the worst yesterday. brian, you know what is happening there. higher mortgage rates with the ten-year higher as well. that was down 2.86%. the banking sector which you expect to get help from the higher interest rates was weaker yesterday as well. >> that will be the big economic story going forward. i'm sure diana olick has a lot

on it. the rising rates impact housing. prices have gone up. most people don't buy a home on the price of the house they buy a home on how much they can afford every month prices have gone up and rates stayed low the monthly payment has been mana manageable prices are up. we know monthly payments will go up because rates will go up. becky, that is the question. how much of this quick and sharp and steep rise in rates will impact housing or is there enough demand that people will kind of suck it up for lack of a better term and pay the higher costs. >> it hits the people newly coming into the market people who don't own a home at this point you see what happens with some of those things. the people we've brought this up with is historically, you are sk still talking about incredibly low interest rates this is not 18% like my parents in the '80s.

what you are watching is what you mentioned. housing prices have gone up significantly. the question is where is the give especially if you are a new home builder, costs are going up for construction watching the home builders yesterday. you are right. the monthly payment matters to the consumer >> lumber futures spiked super high and down and back up. labor costs and steel kofcosts copper costs you need lumber and steel and copper to build a home. >> people are cutting corners. i have a friend doing remodelling and getting rid of the metal. finding ways to get around this. >> what are they leaving out don't worry about the roof, honey. >> i don't know. he was talking about it the other day. they were talking to the architect. they were able to get rid of the metal points they were putting in i wondered if they were getting

shoddier construction because people are cutting corners if you are a homeowner, you are looking for reason ablable ways. if you are a contractor, you are not looking at long-term focused. >> there are six words you don't want a home builder to say to you. we don't need that steel beam. >> i don't think they are cutting beams. there are places where they cut corners. the homeowner was looking at ways to get rid of things. i was thinking about that yesterday. if you are a contractor and trying to get the job done and not working directly with the homeowner. >> one way to cut corners. build a circular house >> or a dome >> becky, that was a terrible joke >> dad >> i am a dad. >> dad joke. >> thank you we are jumping around quickly. brian, on february 16th, charlie

munger is set to hold the shareholder meeting. he is answering questions virtually at 1:00 p.m. eastern time if you like to submit your question, submit email to dailyjournalquestions@cnbc.com i'll ask charlie as many as possible that is next wednesday >> when will you be back we need rebecca quick in omaha >> may >> when is becky coming back in omaha? >> may annual meeting is expected to be on that's the plan. berkshire has said they are planning an in-person meeting. that means 40,000 people or so coming to omaha. that's the plan at this point if trends continue like they look right now. that's where we'll be. >> good. can't wait >> april 30th this year. usually the first weekend in may. they never conflict with mother's day this year will be april 30th. >> april 30th. may 1st. rainy and muddy.

new reporting by cnbc raising questions about whether markets may have gone too far in interpreting comments yesterday from the fed president jim bullard. steve liesman has that story steve? >> reporter: brian, reporting by cnbc finds several fed officials both privately and publicly pushing back against calls by st. louis fed president bullard for the super size rate hikes which rocked bonds and stock markets. the comments of the fed officials suggests that the markets may have wrongly interpreted the remarks held by other fed officials. officials are not supporting or skeptical of the 50 basis point rate hike in marchwhich the market priced in following the bullard comments a chance the committee may do that, but the indication is

bullard may be an outliar on the committee. these officials appear to favor 25 basis point hikes with the position to acceleratethat pac later in the year if inflation is not responding to the fed actions. it landed the fed president raphael bostic who said my views have not changed with the 25 basis point hike that is the statement he gave wednesday before the inflation report and in the speech last night, i would have to be convinced of the need for a 50 basis point hike saying that may be a time for that, but not right now. cnbc reporting found most fed officials were looking for a bad inflation report going into the number and the january report was not worse than expected. not a single official expected improvement in the report.

that is not expected until mid-year officials were pricing in substantial rate hikes and did not see a need to move forward any additional tightening. mary daly said after the report, it's not my preference for the 50 basis point hike. it seems at the moment the marketplac placed a lot of weign the report some officials look for a more measured response. brian. >> a lot to unpack, steve. if many on the fed believe that inflation is transitory or will slow down and inflation will tamp down the second half of the year if they believe that is going to happen, how many rate hikes are appropriate? if you believe inflation will naturally work its way through,

why, then, like goldman sachs now calling for and bank of america calling for, why would you need seven rate hikes? >> reporter: a couple reasons, brian. the first thing is think about a world or the economy without 7% infl inflation. let's say inflation was 2% and unemployment was 4%. the economy had pretty much clawed back all it lost during the pandemic wouldn't you set rates higher in any event? run off your balance sheet the idea and i have been on the story since the december meetin and since january. we are not in a moment of decisive guidance. the fed will be dependent. the fed said it will be low for a long time because the economy is running below potential now the economy is at potential

and inflation is high. what will happen is a measured pace of increases by the fed balance sheet reduction. the fed will hold back any possibility of accelerating until it takes a look around and says we have 100 base tightening in the market. we will do balance sheet reduction. let's hold that back for another year brian, you are into automobiles, is my understanding. you understand if you want to go higher, you want to go up a steeper hill, you want to hold back a little bit. that is where the fed is right now. >> steve, when you do reporting on this and you speak, i listen. it sounds like there is a conspiracy theory that every time we hear from a fed official, it is a trial balloon and it is orchestrated this sounds like that is not the case in that situation bullard say voting member on the fmoc what he says holds a lot of weight when i hear what you are seeing

in terms of the leadership potential pushing back, it seems like a bigger stretch. it seems they did not like the reaction in the market yesterday. >> reporter: you know. it is interesting, jim bullard made no pretense except for himself. he gave a report to bloomberg. that is the view the market is teetering on the edge are they saying 50 or not 50 bullard came along and gave thm a shove. i'm sure that did not reflect the view of the fed officials who i have been touch with the issue is system. nobody was looking for better inflation numbers yesterday. the idea it came in at 7.5% instead of 7.3% was not a reason to change policy i think the story here, becky, is june comes around and july

comes around and you are 7.5% and out sized inflation numbers. that's the reason to change policies the fed wants to present a measured front to the market we're not panicking here this is the number we expected we are not going to change course on one number >> bostic was on with you on this program earlier this week with he floated the idea of 50 basis points i tied those two pieces together 50 basis points a more realistic assumption and view than i had this week. >> what i heard bostic saying is 50 is a possibility. 50 is not the primary move that's why we went back to president bostic yesterday after the inflation number and had one question for him is what you told us on wednesday still stand? he said my view has not changed. i think that's the key he is calling for three or four

rate hikes this year that's what he would like to see. 50 is still a possibility. it is not the primary responsibility that is the key, becky, i keep giving you the figure and i'll look it up again it's the figure i have calculated on my interactive sp spreadsheet here of how much tightening is in the market before the federal reserve has changed a single rate. right now, it is 110 basis points of change in the two-year note since powell pivoted on 11/29. my understanding and we asked fed officials. this the fed is fairly pleased maybe not that much. by the way, becky, did you see the 25 basis move in the two-year >> yeah. >> you haven't seen a move since the departths of the financial crisis that is an out-liar. what is the need for that? we had good response in the market there wasn't a need in the

market to additional tightening beyond what the fed already had. >> interesting 1% may be baked into the market. steve, it is a theme we will have for the next two hours and 50 minutes steve liesman, thank you a programming note jim bullard will be on this show on monday at 8:30 a.m. eastern becky, i may or may not be watching. >> goodie-goodie. >> i will be in phoenix. a conference why not go to phoenix? >> i see up next, morning movers. we will dig into the moves with the firm holdings and zillow affirm is down 9%. zillow up more than 13%. here is a look at didi global. falling after the tencent said

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shares of the buy now pay later company affirm holdings dropped 21% during yesterday's session. it is down sharmply again this morning 9% this came after the company put out a tweet with the company's performance. the company reported a loss of 57 zecents a share. that sparked questions about the impact of the partner amazon brian, the lesson there is if you are on the other side of amazon as a partner, it is the same on the other side of supplier to somebody like walmart. they are the biggest company they have a lot of say the deal may not be as good as

you might anticipate for the other side. >> the lesson is watch your tweets make sure you don't jump the gun. >> oops. oops human error. we've all done it. zillow shares jumped as much as 20% in extended trading before moderating. the stock this morning up close to 14% this is the dig ital real estate company is getting out of the home flipping business that led to fourth quarter revenue that beat expectations by a wide margin the question always with this one is they have so many people who look at it on a daily basis. 25% of everybody who is out there looking for a new home, how can they capitalize on that? how can they monetize it >> that is giving me the question and so much with the home buying plan that went awry.

this is the ultimate housing stock play we talked about rates and housing and where this goes. zillow may be the perverbial canary in the coal mine. >> it is flapping right away if it is the canary >> the canary has flown a bit. 13% gain now a rough flight for said canary let's talk about the markets and your money futures are down dow futures off 136 points nasdaq is the one to watch futures off. down as much on a number basis as the dow we don't see that a lot. big tech higher valuations. more impacted by higher rates. yesterday, stocks took a gut punch. bond yields rising fast after the red hot inflation report

st. louis fed president jim bullard is in favor of the aggressive rate hike path. let's get perspective on bonds and rates and stocks we are joined by kumar let's talk about what steve just hit on in your mind, how much of future rate hikes are built into the markets? both stocks and bonds? >> brian, great to be back with you. i will begin by saying there is no say how much interest rates will increase. i would say it could be four or six or eight times from where we are. the reason is the fed has been

so far behind the curve in missing the inflation that they have to make up for it so my expectation is whether they raise 25 basis points or 50 basis points on march 16th, it is not going to be sufficient. i would ask the question with inflation being red hot, what pre-vvented the fed from havinga emergency meeting yesterday and stopping bond purchases right away bonds are still being bought this month the supply is increased. they are buying back securities. pushing up home prices as president biden is worried about home prices being out of reach this is a federal reserve which is not in touch with reality brian, it is hard to say the most important point is the bottom line. a few minutes ago you had the screen showing two-year to

ten-year yield curve that amounted to 40 basis points last night last friday, it was 60 basis points we are heading toward inversion in a hurry i think i'm on recession watch which i have been for the last six months now it is more urgent. >> ryan, i'll get to you in a second i have to follow-up on that. some of the smartest people, like you and others, will liken what is going on now and i won't quote this the fed is like the arsonist trying to put out the house they lit on fire. money supply up 40%. qe is still going on rates got cut to a level that we now know they did not need to be cut. does the fed have the ability to put out this fire? you can make the argument that inflation is caused by two things the world reopening at the same

time we know that also, our fed, and to be fair, other central banks raising balance sheets cutting rates because and i guess i'll give them a break they fundamentally under estimated what would happen during the pandemic and not realizing consumer demand would go up, not down. >> very true i love your analogy. let me begin by saying that not only do i like it, the fed is trying to put out the fire with gasoline that is essentially what is happening. the fire will burn even brighter and bigger what is going to happen? the second part of your question is can the fed control it? no they cannot control it without pushing the economy to a recession. they raise rates three or four times, forget six or seven times, brian the economy will go into recession as president biden and

democrats are going into the mid-term elections. >> ryan, there is nobody out there with more historical content. i lift your stuff all the time for the rbi. thank you for that this market is facing a multiheaded monster. you have housing and geopolitics, russia, china, et cetera do we find some comfort in the fact that the dow is only down 3%this year. stocks have held up relateively well what do you see happening going forward? >> good morning, brian i liked your dad joke earlier. that was pretty good stocks are up this week. you know, since the low a couple of mondays ago, yes, we are consolidating. i know everyone is worried about the reaction two-year yield big deal s&p up to the 50 day moving average and sold off small caps sold off. it makes sense

look at the economist cover. it came out this week. it is talking about what to do after the market crash cinema is lopsided and worried we mentioned concerns. you know what? the consumer is strong they upped prices 4% people are still buying. consumers are strong and earnings are over 30% year over year those are positives, brian we are more optimistic we are still a market and the economy is still strong and we will avoid a recession this year because the consumer is so strong >> brian, if i can jump in. >> go ahead. >> if i may jump in. talk about the stocks strong and positive message i wrote a report in october of 2007 saying we would be on the verge of recession i was called a fear monger

what happened was within two months, the recession had begun. my problem was that 2008 was not -- i didn't guess it would be as bad as it turned out to be stocks are a bad predictor of the economy. the bond market is a better predictor. look at the two-to-ten not the s&p. >> this is the constant push-pull with the bond folks and stock folks. it will play out thank you both have a great day and great weekend. >> thank you, brian. >> thank you when we come back, uber's ceo will weigh in on the crowded delivery space and its deals with drizzly and go puff that's next. >> announcer: what's working is sponsored by comcast business. bounce forward at comcastbusiness.com.

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at uber investor day in new york city, the ride share expecting to be cash flow pos positive by this year. andrew spoke with dara khosrowshahi and spoke about the food delivery in ten minutes or less >> we want to take a partner led approach as it relates to quick grocery. you have to size a company we are really good at it and what somebody else is better than we are. i'm not great at opening

warehouses or negotiating leases other people are are better at it than i am i want to bring the awesome experience to the consumers. i, for example, two nights ago, not good for my waistline. i ordered from go puff i got really, really tasty ice cream in 20 minutes. it happened through the uber eats platform. >> how much are you depending on that for the future? you start to think about the 2024 numbers for example and i asked because there were reports that go puff employees are spending money on instacart to fulfill some of the orders to actually get stuff on their own shelves. going from one to theother. >> i'll talk to them for them to use uber eats to order groceries. i'm not dependent on that

business being significant for 2024 targets i would consider that upside the base business, the mobility and innovation with the delivery business with eats and main line grocery and advertising and euphrates and digitizing logistics. that gets us to the 2024 targets. we have a lot of upsides we hope to get to an upside situation. >> the ftc looking at the partnership with go puff the deal also with drizzly speak about the marketplace and competitive marketplace. >> with grocery, we're babes in the woods. we're so early in the marketplace. majority of alcohol is offline with corner stores, et cetera. we respect ftc taking a look we are confident if anything, we'll increase competition in the sector we'll a big player

we havare ambitious. we want to bring incredible experiences to our customers we think we can make the marketplace more efficient and competitive. >> we will have more of andrew's interview with the ceo dara khosrowshahi coming up you can watch the full interview on cnbc pro. coming up, the public outcry over lawmakers stock trades. now spilling over into other branches of government we will take you live to washington for the latest futures. down 10% could be another wild friday the sun's coming up. we're back after this. >> announcer: executive edge is sponsored by at&t business keeping your business connected. , our best deals on every iphone - including the iphone 13 pro with 5g. that's the one with the amazing camera? yep! every business deserves it... like one's that re-opened!

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choose direct. welcome back what started as a stock sttradi ban for lawmakers is spreading to other branches of government. we have mylan mui with the latest >> reporter: becky, a new proposal out from democratic representative from porter and gillibrand would ban from the president and vice president and federal reserve officials.

gillibrand is one of the authors of the stock act she told me the scandals during the pandemic made her realize there needs to be a broader approach >> the truth is the american people don't have faith in government right now we want to show that across branches that we are creating transparency and accountability. >> reporter: new rules for judges are priority for house speaker nancy pelosi according to the watch dog group, three supreme court justices own individual stocks and had to recuse from cases because of it. according to the latest data, john robert owned charter communications and stephen breyer with lowe's and samuel alito with the biggest portfolio. 28 companies unclear if these stocks are held by the justices themselves or spouses or dependents. the youjudiciary is trying to

update, but congress is not moving fast enough back to you. >> that is rich. congress doesn't feel they are moving fast enough ylan, there is a lot to get cleaned up do you think this is a situation where something actually gets done or is this talk or fury ahead of things and it all gets watered down and nothing happens? >> reporter: it is really hard to say at this point, becky. this is something that has been bubbling up from the members as we saw with the pressure caused pelosi to soften her position and willing to look at this there is pressure. you pointed out before we are in a campaign year. this is a political issue to show you are trying to clean up washington it is something that has momentum and legs. we will see what the final proposals look like. there are ideas. >> ylan, thank you you will continue to follow this thank you. see you soon when we come back, jeremy

siegel will join us to talk about the inflation and the fed. and more mask mandate roll backs. we will talk to dr. scott gottlieb s&p is off 21 and the nasdaq off 94 "squawk box" will be right back. i need indeed. indeed you do. when you sponsor a job, you immediately get your shortlist of quality candidates, whose resumes on indeed match your job criteria. visit indeed.com/hire and get started today. -capsule! -capsule! -capsule! capsule saves me money on prescriptions. capsule took care of my insurance. capsule delivered my meds to my doorstep. capsule is super safe and secure. get your prescriptions hand delivered for free at capsule.com

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the latest read of inflation spooked investors pushing stocks

in the red zone. now investors are wondering what's next. joining us to talk about it is jeremy siegel. jeremy, you have been saying you thought we would be in for rockier times. did anything you see surprise you? >> good morning, becky nothing at all i expected a worse than expected report and i think that the next month is not going to be good. remember, we have one more price report before the march meeting on march 10th. that is the february consumer price index. that will be important we are all speculating now about whether there will be a 50 or a 25 i think march 10th will tell us and if that number is also above expectations, i think that they got to go 50 basis points in march. as you know, i have been saying for over a year, they are way behind the curve

a few minutes ago, you had kumer on he had been saying that. i have been saying that a long time it makes no sense to think about things below 1% with inflation between 7 and 8. i think that there's going to be more hawkish surprises on the other hand, you know, inflationary environment, you want to be in real assets like stocks the earnings are coming in firms are not having any trouble passing on those higher prices this is very different than the ' '70s with inflation and opec and oil and they could not pass on firms can pass it on as a result, i don't expect a bear market. i did say i thought that nasdaq would probably get in the bear market territory i don't think s&p will i think the rate hikes are going

to be more aggressive. they are behind the curve. very behind the curve. >> professor, explain this to me we got the hotter than expected inflation number markets dropped and then stocks picked up until jim bullard saying he thinks it will be 50 basis points and he wants to see 100 basis points by july that is what set the markets in a tail spin. i don't know if you heard steve liesman and he doesn't think the fed leadership is on board with this speaking that bullard is speak for himself. did they panic because of what they saw with the market reaction there >> well, i think i know james bullard a lot. i interviewed him on a radio show i think he is a great out of the box thinker. he is often a forward thinker. remember, becky, last september,

more than half of the fmoc members thought there would not be one hike. and inflation got worse and it is two or three or four. bostic and others who say i'm not sure all we need is one more bad report look at where gasoline today is compared to the middle of january when it was much lower we've had price increases in the last month that will show up on march 10th they will not get a good report. that will sway these other members. a very data dependent. if the data continues to come in hot, and i think it will, look at shelter and housing prices which are beginning to filter in we talked about the fact that the way they collect the data and they're not getting it in fast enough. it is beginning to come in now

frankly, we had 10% inflation last year. if you moved up the prices the way we should. the way we collect stats is slower and it is coming in and we will get, i think, another very bad report on march 10th to persuade the other members. >> professor it is brian. we need to remember that i urge any member of the fed or congress to go to the grocery store. i doubt they have been to the store. i like to do prices with them. ask what the price of a gallon of milk is i doubt anybody would know that said, i think the biggest risk to the market is if you are under 40 or 45 years old and a lot of people run serious money in their 40s they have never run. we have seen it for decades. is the biggest risk the inexperience of the quote p professionals in the environment

they never lived there we have never been in this inflationary environment >> well, you are absolutely true you know, it is surprising to me that the fed has been so slow -- >> why professor, they cost -- >> i have to say i think it is a major policy mistake and history will say that they absolutely should move. they are way behind the curve. that is more serious than the investment professionals who are scared of the rate hikes that are going to come up again, you have the struggle firms are able to pass on those prices and still 1% and 2% is still very low from the historical standpoint. are you going to say, oh, my god, i'm getting out of stocks because i can get 2% on treasury bills? i still think the argument is

stocks again, the thought process and the bull market was dependent on zero rates and an accommodation. as that is taken away, they have to reassess how they have to capitalize stock into the future >> well said let's not forget the s&p not fo0 is still up 40% from two years ago, so since before most of us had ever heard of covid the stock market has soared. so let's just put everything in context. jeremy siegel, a pleasure. thank you very much. coming up, super bowl sunday right here on nbc, by the way, mbised to be the biggest legal galing football event ever but what stocks might benefit? how much money are we talking about?

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welcome back and good morning. check this out more than 31 million americans plan to bet roughly $7.5 billion on sunday's super bowl broadcast. by the way, right here on nbc. a 70% jump from last year. that's according to the gaming association. it will be the biggest legal gambling event in sports history. let's talk about it now with founding and managing partner, dave, welcome. you can't go one commercial break without seeing a tv ad for one of these companies they're throwing money at you for promotions and begging you to bet through their platform. is there anybody actually making money no matter how much is gambled? >> it depends on the state and eventually they will on a nationwide basis, but several

other companies like fandool and draft kings are saying we're profitable in new jersey where we've been operating for three, four years where we've scaled our business and other states like new york that just went live last month, certainly they're not profitable there yet. >> do we think these companies will ever be profitable? i mean, they're just taking that sort of that spread between -- they don't care if you win or lose, they just want that small take can that make it that way in. >> yeah, they can. i think of it almost like a marketplace model, uber and lyft i do think the leaders in this market mandool, draft kings, bet mgm, caesars today will all reach net profitability. and they're making a lot of money in the online casino business some of them have horse racing or poker businesses.

they have their physical casino footprint which they can sell and drive customers into, so a lot of them look at this holistically beyond sports betting. sports betting is the lower margin business but they have a lot of ways to make money. >> i know uber is talking about making money down the road but they've lost tens of billions of dollars down the road to hopefully get there. can all these players make it? >> i think right now all the players on the screen can make it, some of the second tier companies maybe cannot make the profitability because only so many scale players will win. we see it in the u.k. and other mature markets i really like the number one company really globally in this space and owner of fandool, which is the number one operator in the united states by a fairly wide margin.

so i think investors are missing on that one significantly larger than draft kings but since it's part of a u.k. public company as opposed to a pure play u.s. public company i think some of the parts are getting undervalued there. >> maybe not getting the love it needs to because of where it is based. of course they bet on the other football, mostly soccer. dave, we appreciate the views. if you're betting, good luck bengals plus 4 1/2 and a reminder you can always watch sunday's super bowl here on nbc the coverage will start at noon eastern time the los angeles rams will take on the bengals and a bengals home game in los angeles and we've got a few people on this show i'm told who might be there. monday we'll have a special line-up of guests from sofi stadium in los angeles. they'll be joining cnbc for exclusive interviews live omfr

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futures are pointing to a lower open after yesterday's sharp sell-off that was prompted by higher than expected inflation data we'll get you caught up on what's moving the markets ahead of the opening bell. st. louis fed president james bullered calling for a 100 basis point increases by july 1st. but some in the fed are pushing back against that idea

it's pretty important. steve liesman joins us with this breaking news. and in it for the long haul. trucker protests ramping up and blocking trade with the u.s. now there are calls to end this disruption while there are also reports of a possible protest at this weekend's super bowl. we'll break down what it could mean for the economy as the second hour of "squawk box" begins right now all right, good morning and welcome back to "squawk box," everybody, right here on cnbc. and tgif joe and andrew, they're off, likely on a plane, maybe together we'll see. u.s. equity futures at this hour, they are down, so we could see some selling like we saw yesterday. will that fall through today well, here's the good news and here's the bad news.

the bad news is right on the screen, futures off 132, nasdaq futures off 87 the nasdaq futures were down triple digits just about 30 minutes ago, so the market not weakening. it's still weak but not down as much as it was hey, it's friday trying to find some kind of silver lining here's what's making headlines at the 7:00 a.m. hour. the economic impact of the trucker protest at the u.s.-canada border is ramping up both ford and general motors have had to cut back production because of part shortages resulting from the blockade of the ambassador bridge which connects to detroit and windsor, ontario, canada. truckers are protesting covid-19 vaccine mandates and much more on the story coming up a bit later in the hour. that protest is causing supply chain issues. another area of congestion is easing a bit at last count the back up of ships in the port totaled 78,

not ideal. however, port officials say they're not ready to declare a decline a permanent trend, and a lot of those ships are just shoving off the coast of mexico, just kind of hiding. and this weekend's super bowl games expected to be the biggest legal gambling event in super bowl history the american gambling association expects 31.4 million of you to place a wager on the game that would be a 78% jump from a year ago fueled of course by the spreading legalization of sports betting in the u.s i've been public on twitter my bets i am 15-2 i don't know whether to retire or not, but i'm maybe one last one bengals -- don't bet against burrow >> i would take the bengals, too, but quit while you're ahead. everyone always says one last bet and then i'll quit >> it's house money at this

point. >> the ambassador bridge, the bridge between detroit and windsor that carries as much trade as all trade between the united states and united kingdom. >> 25% of u.s.-canada trade goes over that bridge, which, by the way is privately owned the guy who owned it is a billionaire really just from the bridge and he said to the canadian government of course he's got an interest just in the mandates covid cases are way down why not just end the mandates and get the truckers rolling and over the bridge? >> the private control of that has been such a big issue because they're able to ratchet up whatever they want for the tolls that there were already efforts to build another bridge to ease the congestion of that one bridge and just the control they have of that entire market. anyway, we will talk about it later this morning in the meantime we want to get to dom chu he's looking at this morning's market movers, and what do you see today. >> first of all, let's check what's happening with some of the earnings related stories we've got affirm right now and

showing some signs of weakness it was down big yesterday, down 11% in trading today the buy now, pay later company it was interesting there was confusion. it reports a wider than expected loss we don't know if it was comparable to analyst estimates, but the revenues in its current quarter forecast were better than expected, but it was the timing of it that threw a lot of people off it came out not at the after the bell closing bell customary time companies report earnings. it was accidently tweeted out at least part of the link to it at about 1:30 in the afternoon yesterday in the middle of midday trading that sent shares initially higher then lower and then we're seeing a lower again move in firm holdings. buy now pay later has been a very, very big roller coaster ride for a lot of investors after big runs higher last fall. and analysts are already starting to weigh in this morning whether slowing growth could be in the future for some of these buy now pay later and affirm could be one of those

then we've got zillow actually coming out with better than expected revenues. it says it's winding down its house flipping business quicker than anticipated and gave a current quarter forecast better than its forecast as well. zillow shares up about 15% in premarket trading as well. and then we're going to end on an interesting, confusing story as well. didi global, the chinese ride hailing company is down about 4.5% right now on trade. it was up nearly 9% on trade yesterday, and this is all because of maybe a miscommunication one of the biggest holders in didi is chinese internet 10 cent global it put a filing yesterday indicating it had increase its stake in didi, only to put out a clarification that it rather got

more shares it had already subscribed to. all of that confusion leading to a run up in shares yesterday and a bit of a sell-off in those shares this morning. so didi global, zillow, and affirm i'll send things back over to you. >> a lot of confusion out there between didi and 10 cent and affirm everything's gone insane thank you very much. let's talk more about the markets, the federal reserve and everything in between because there are some questions about whether or not many in the market are interpreting incorrectly or isinterpreting or just getting it wrong on comments fed president bullard and just how hawkish he and the fed may be we hang on every word of these fed governors, bullard in particular and a few others. i mean, is the market getting it wrong? >> brian, reporting by cnbc finding several reserve officials both privately and publicly pushing back against

calls by st. louis fed president bullard yesterday for its super sizederate hikes and the fed may embark on a more measured rate hike reporting by cnbc finding these officials either not supporting outright or very skeptical why there is a chance the committee may do that the initial indication is that bullard may for the moment be an outlier on the rate setting open market committee a with a decision to accelerate the price only later in the year the atlanta fed president we reached him yesterday after the inflation report he says my views have not changed for three or four rate hikes this year.

that was the same view he gave on cnbc wednesday before the inflation report the president he gave a speech last night saying, quote, i'd have to be convinced of the need for 50 saying there may be a time for that but it did, according to his comments, appear to be now most fed officials were already looking for a bad inflation number, and the january report was not substantially worse than had been expected. the san francisco president she setout the inflation report of 50 basis points and, quote, not my preference. still five weeks before the meeting and the situation could of course change but key officials even after the inflation report continue to hold to the outlook of measured tightening, not supervised brian? >> what's next, then we've got jim bullard on squau"squaw box" at 8:30 tomorrow morning. i'm going to ask you a question

you probably won't answer because you're close to the fed governors. is it bostic, is it bullard? obviously powell but outside of that who should we be paying the most attention to besides liesman? >> that's actually a good question because over the years i've been covering this it's pretty easy to say when there's some disagreement, some confusion on the committee you listen to the chairman after that you listen to the vice chair over the years i've heard if the chair isn't talking and there's something to be said the vice chair may come out and give a speech that kind of curtain raises the comments of the chairman listen very carefully to that. the other way to do this, brian, is to separate folks out into where they kind of generally stand and pick a couple in the middle who are -- the ones who

are the fulcrum of the compromise that will be put together in this case mary daily she was very, very dovish and she's come a long way i'd wait for the chairman. maybe he'll clear things up in the next week or so. but i think jeremy siegel, the professor, had an important comment which there is another cpi report to come i think the importance of my reporting here is nobody was looking for anything better in yesterday's report the consensus was, what is it, 7.3 or 7.2 it came out 7.5. it was not dramatically different. the key here there wasn't a need to dramaticallychange the outlook for policy bullard by the way never made any pretenses and never would because he's been doing this a long time that he's speaking for

anybody else but himself in fact, he was doing what any fed president does when they speak, which is speak for themselves >> steve, we're going to have bullard on "squawk box" monday morning. really excited about that interview. i guess part of the question might be what were his thoughts before the 7.5% overhead yesterday? was he thinking this all along because bullard tends to be one of the more hawkish people on the fed. all the regional presidents hear back from companies and from farmers and businesses in their district i just wonder what he's hearing from all of those people, and if that's the reason he's saying he wants to see these faster rate hikes. >> jim has had sort of flexible views. he began with part of the pandemic being very dovish, really onboard and he had been against the 50 basis point hike earlier, but overall he's been among the more hawkish members of the committee. and he and i guess the best way to put it his former protégé which is now technically higher

than he is which is chris waller, have been more hawkish in talking about balance sheet reduction. governor waller was one of the first ones to be speaking about the balance sheet. both bullard and waller and some others have been on the more hawkish side of course, powell has done what he's done all along which is split the difference between the two. and also what's interesting here -- >> i was going to say you brought up the midwestern ones who are all more hawkish bullard is a voting number maybe their voices are a little louder >> they may be a little louder but everybody on the committee has a say, andin general what the chair wants to do is to fashion a compromise so that even if you're not voting the fed chair doesn't want people on

the committee going out and saying different things just from the committee everybody has an opportunity to speak there, and they will and they'll speak publicly, and we'll have them on cnbc over time but i think the thing to do is put each person in context, and i think that gets to brian's question and yours as well, becky. >> steve, appreciate it, our friend thank you very much. and just to reiterate 8:30 monday morning that will be a big one. there you go coming up, amazon changing its covid protocols. the masks are coming off we're going to speak to dr. gottlieb about that and his take on health care post-covid. is the pandemic causing financial stress in your relationship we're going to have a report on the rise of what some are calling financial infidelity and get a check on your markets and looks like it could be not a great day on wall street, but nasdaq futures were down

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let's take a look at the futures this morning after a rough day yesterday with the dow down more than 525 points you are looking at the dow futures down once again this morning. not by as much as we were about an hour ago. right now down by 70 we were down triple digits just a little while ago s&p futures are down, too. this has been the key because this was the big mover yesterday. the two-year moving the most it's moved since all the way back to 2009 during the height of the financial crisis. right now the two-year is yielding 1.75% the ten year still hanging above at 2.00%

amazon is changing its covid mask policy saying it will allow fully vaccinated employees to go maskless inside of warehouses effective today. while that may be good news for the amazon workers, this likely won't be amazon is also taking away covid-related pay leave for unvaccinated employees in the meantime, what a change this week has been new jersey, california, connecticut and more changing their policies at the same time this week. and add to that the fact nevada and governors doing the same thing at the same time is raising some eyebrows. dr. gottlieb, a lot of questions. listen, it's good for the kids assuming the school boards go along with this. it's good these policies are changing i guess to many parents, but should it raise some eyebrows given that everybody suddenly did it in a 72-hour window >> well, look, the states that

are doing it are states where prevalence is declining? if you look at new york state and tri-state region, look at boston and midatlantic, florida, cases are almost back down to where they were before even the delta wave in the fall if you look at the leading indicators in boston and new york city is a pretty good predictor of the trends in the cities it's way down the pace. but they can start to lean forward now more safely. >> they've published this data online every week as well. but cases are still above where they were when the kids went to school in the fall that is what i think raises eyebrows my son went to school in early september. cases were way lower than they are now, and so now they can say cases came down, but you can look and say on an absolute basis they're still higher in

many states than they were when the kids went back to school this the governor is saying that the pandemic has run its ultimate course. >> it's probably nothing going to change the trajectory they're measuring, if people unmask a little early and start to take more risk and socialize more, perhaps cases won't continue to decline as rapidly as they've been declining but they're going to continue to come down. when you look at the tri-state region, for example, cases are pretty low right now it's pretty much back to the baseline of before the omicron surge. there are parts of the country where it's way down. hospitalizations are still up. they're a lagging indicator. it takes a while for people to be discharged from the hospital. it's not data out of south africa as well where they have b2 it's not 100% of all the cases

while that new variant spread it didn't change the overall trajectory, and that seems to be the experience here, too b2 is gaining very slowly in prevalence but not changing the overall trajectory which is a rapidly downward trajectory. i don't think governors lean forward anticipating conditions are going to improve recognizing people are afraid, people have been doing this for a long time and we have narrow window of opportunity. they want to seize that opportunity. >> let's talk about something. i want to look, forward, doctor. i've been wanting to ask you this for a while because covid has been horrible and awful and probably going to have a million people their lives lost, taken early. it's been an absolute disaster for so many families and i want to ask you this, with higher prevalence of cancer, okay my local oncologist because someone close to me fought

breast cancer last year says her practice has seen a doubling in active breast cancer cases what kind of post-covid health care response do we need because you could make the case that we will lose millions of early lives over the next ten years. what do we need to do post-covid >> look, we need to anticipate the fact there's going to be a lot of morbidity on the back end of this. people who gained weight, too much drinking during covid, mental health issues and people who didn't follow up with routine screenings so they didn't catch cancers and other medical conditions early enough where you were able to intervene more easily and implement therapy. there's going to be a lot of morbidity on the back end of this we need to start anticipating that doctors need to be more aggressive bringing people in for screening. there's going to be a lot of health care costs on the back

end of this. you'll see ratios start to get compressed for manage care companies as people start to seek more health care. >> why isn't there a national conversation about this? why aren't we talking to your point as bad as covid is and it's been horrible, and nobody's down-playing that. but to your point and many other experts, we're looking at all these other things we can see this coming we know what's happened. we know about the missed screenings we know about the diabetes prevalence we know about the emotional and psychological toll so many have suffered when do we begin i want to try to be positive when do we begin on a national level having these hard grownup conversations about how to help people and deal with the other things that have been sort of ignored almost fentanyl abuse, alcohol, all this stuff whether do we deal with this how? >> we should deal with it right

away i think there's been a reluctance to look into the future and there's been a reluctance to talk about post-covid state including by health officials who fear if we talk about what the post-covid state is going to look like and take away the incentives of people we need to start having this conversation now because there's going to be things that policy works if they work quickly can do can get resources especially to hard to reach communities and this risk we've accrued, health care risk we've accrued. >> scott, on that same point we had filed with our insurance company, put in some bills that we hope to be reimbursed for several months ago it's taken a while not a big deal for me. when i asked around about it i heard a lot of insurance companies are at least four to six months behind on catching up a lot of these things. for somebody who doesn't have a lot of money that could be a huge issue if you're in the middle of some treatment or

therapy or something for those people not to get reimbursed how frequently is this happening? >> yeah, i haven't heard that. and i don't think the health insurers had an unusual burst in claims because of covid. they also start reduction utilization, so as you know if you look back over the last years many insurers did reasonably well through covid buzz the increased costs by the pandemic was offset by decreased utilization of other services and other health care needs. >> it's a pleasure to have you on we've got a long way to go in the next few years and a lot of things we're going to have to work on. doctor, thank you. when we come back we're going to talk inflation, the impact on fin tech and much more with chris flowers we'll also find out if there are r there's opportunities in the fin tech and banking space here's today's aflac trivia

question we'll have the awewhnsr en "squawk box" comes right back. this idea of making a movie about caring, it resonated with me. and not only caring, but how does that apply to someone from our community? it's about taking care of each other. she is an example of strength. ♪ ♪

welcome back to "squawk box," everybody. the answer to today's aflac trivia question. who are the only two players in nfl history to win the mvp title in the super bowl in back-to-back years here's the answer. bart starr and terry bradshaw. a new survey finds nearly 60% of adults say the pandemic has increased financial stress in their relationship. for some that stress may lead to things like hiding a bill, hiding a purchase, maybe a bank account, a new credit card statement from their partner, hiding empty wine bottles under the kitchen sink wait, did i say that cnbc finance correspondent sh sharon epperson these money secrets can be a sign of financial infidelity >> reporter: melissa houston started with small indulgss.

>> like my banks and clothing and shoes and stuff for the house. >> reporter: then move onto major purchases. >> i need to renovate the house. we need to put a swimming pool in >> reporter: as her spending the creased, her family's finances spiralled into massive debt. >> i went off the rails and i accumulated over $100,000 worth of debt through credit >> reporter: and she hid it from her husband. you racked up about $100,000 worth of credit card debt, but your husband didn't know about most of it how were you able to keep that a secret >> so because i'm the finance person in the family he trusted with me with the day to day financial management of the household. >> reporter: a former accountant turned entrepreneur, she eventually confessed now the couple is working through this crisis together >> it took him a long time to trust me again >> reporter: 43% of adults admit to committing financial infidelity against their partner. >> hiding financial inflammation, financial transactions from your partner in a situation where they want

to know and that keeping information from them is harming them >> reporter: jill, author of intimate lies and the law says discovering deception is often difficult. >> we trust, we want to trust and it's very hard to overcome that >> reporter: yet 39% of adults avoid talking about money with their partner. kelsey decarlo hesitated discussing money with her boyfriend at first >> there was months of discomfort, me skirting the issue, me no longer sharing anything about money with him. >> reporter: when they decided to move in together conversations about her student loan debt and his desire to buy property were more honest. >> finally reaching the point of comfort and trust to say i know this is something you want to do, but i'm not ready. where do we go from here >> reporter: she revealed she didn't want to co-own property yet. he bought the place on his own >> it does take effort it's not always an organic conversation >> reporter: one way to build

trust some experts say is to have regular money dates with your spouse or partner, set aside time to talk about your finances and your financial goals and do regular checkups. review bank statements and credit card bills for accounts you hold jointly as well as joint task returns you want to make sure that you're both on the same page brian? >> yeah, sharing is the big story here can you give us a bit of psychological advises before we let you go you're the expert in this. if we are hiding something -- i'm asking for a friend -- how do we gently reveal, honey, i may have taken out an extra credit card you don't know about and bought a motorcycle because it sounded fun at the time >> you need to have a conversation i think that's the main thing that you need to talk about what you're spending and also what your goals are one of the things, though, i really like, brian, and i believe it is yours, mine and ours account because then you don't have to share everything, but you share the major expenses that you've

decided each one is going to pay for. you discuss that or you discuss what's in the "ours" account but what's yours is yours, and that way you can have that disposable income. >> as always, appreciate it. thank you. have a great friday. all right, to read more on this go to cnbc.com/invest. inyou. as a user of acorns and not saying this because we have a stake in it, it's a fantastic service. you open it up and you have a lot more money you aren't even paying attention to those round ups on purchases. much more to come. plus trucker protests continuing in canada, shutting down roads, disrupting commerce. we're going to speak with "the new york times" tom friedman about the political divide this is "squawk box" and you're

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this is bob minetti and his wife wendy. in 2016, he was diagnosed with pancreatic cancer. bob participated in a clinical trial that included cutting-edge radiation therapy and surgery. he's been in remission since completion. i am so glad i learned what was possible for me stand up to cancer and lustgarten foundation are working together to make every person diagnosed with pancreatic cancer a long-term survivor. visit pancreatic cancer collective.org. it's widely known that higher interest rates could be good for the banks, but how high is too high and what happens to the fin tech space with finance? let's bring in legendary

investor chris flowers he's the ceo of jc flowers and company. crist, first of all let's talk about what happened to the two-year yesterday because it moved 20 basis points higher we haven't seen moves like that since back with the financial crisis, 2009 you were involved with what was happening there and keeping track. what does this mean now? >> it's not just what it means now but what it's going to mean. i don't know any better than anyone else if interest rates are going to continue to rise sharply. but if they do it's going to have implications. >> what type of implications >> well, i think up to a point it's going to help our segment, financial institutions it's going to have banks they're going to have better interest rates and so forth. it's going to hurt equity values if there's really a lot of inflation persistent, i remember that from the 1980s, ultimately that's bad so if we've really got a lot of inflation in the system that's going to be bad for all

businesses >> what's your guess on this because this is back and forth the fed seems to be pushing back from what jim bullard said yesterday rate hikes are going to come very quickly that's more than people had been anticipating, but then again so are the inflation numbers. >> yeah, i don't have a better guess than anybody else does we try to organize our business so we don't have to worry about it that much >> all right, let's talk about what you are predicting. you've been predicting for a while that the fin tech names would have a much tougher time with this. why, and how is that kind of playing out now? this is very different story than the big banks or other banks. >> yes i was last on "squawk box" and at that time we really saw a very notable fin tech bubble what you have today is something that's get -- there's still a

lot of companies that don't make sense, will never make sense and therefore live in an eternal bubble, and you have some that are great franchises and getting a more reasonable price. >> if you think that some of these are still companies never going to be work, you want to be specific and name names on them. >> i think it's maybe not individual names, but i think for example there's insurance has been a really tough sort of a graveyard for fin tech for a long time. i think the payment space has much more promise and much more opportunity. >> hey, chris, brian sullivan. i'm going to insult all of our private equity viewers and listeners right now, and i apologize for that it's been so easy to make money in private equity the last few years. you borrow money at nothing, buy a company, take out the cash flow, you issue debt, you rinse, wash, repeat, do it again.

is this rate hike enough to kill some of the weaker private equity players out there >> not all by itself, no this alone is not enough and this -- i was asked a big question and i don't have a big answer that's what matters. you know, this one by itself won't make that much difference. if we have big hikes over a long period of time, big increases in interest rates and you would expect with that, you know, i get to the equity markets and it is going to separate to a significant degree >> how much do you expect the cost of capital to go up say in the next 12 to 24 months not right now, chris, but that's what you planned for how much will capital cost two years from now >> i don't have a useful prediction on that and of course it spreads out in a lot of different ways. you have how much the treasuries cost and how much the high end debt cost and a very important

factor is how much equities trade. i guess that is how much capital costs. a big correction is what's going to make a big difference to private equity >> chris, just taking a look i mean trying to figure out your positions on some of these things, again, you were right. you called for this very early on with fin tech, this was going to be happening last may we have seen a lot of that pain pay off. was this a sector that wasn't necessarily short at this point? >> i think there's still air in that bubble. we'll have some rate hike increases, we will have some higher interest rates, but it will be of a size where businesses will be okay, equity markets okay, and fin tech i think some air will come out of the bubble, yes. especially the fin techs that lose money and rely on equity to

try to build up their story. those are the ones most vulnerable those are the weakest ones that sounds like your overall thesis is that the equity market is still a good place to be. >> yeah, i think an okay place to be. >> chris flowers, thank you for your time. good to see you. >> thank you all right, coming up here on squawk, uber shares were halted, the company issuing near term and booking forecast andrew caught up with the ceo and talked about the business. highlights are straight ahead in that conversation. the economic impact of the trucker protest of the american-canada border is ramping up talk to tom friedman about that and much more. futures are down but only 32 they're coming back. and "squawk box" will be right back after this.

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of those ready for the next challenge. today, we are translating decades of experience into strategies for the road ahead. we are morgan stanley. on february 16th next week chairman munger is going to be holding court at the shareholder meeting. he'll be answering questions virtually starting at 1:00 p.m. eastern time if you'd like your question asked you can submit yours today. i'll go through all those questions and ask charlie as

many as possible this is next wednesday, but get your questions in today. "squawk x"ilbebo wl right back with tom friedman.

now to the latest on that ongoing trucker protest in canada's capital of ottawa and border crossing on the american border the biden administration is urming prime minister justin trudeau to use federal powers to end the blockade, whatever that might mean the chamber of commerce calling

for a resolution on the matter saying the disruptions are adding to significant supply chain strains on manufacturers on businesses in the u.s protests forcing auto makers like ford to get parts over the border including flying parts in christina, what's going on this morning? >> reporter: well, brian, it's a crucial chain link block by protesters for the fifth day you have this one from detroit blocking all incoming and out going traffic trying to leave the country, and you have trucks that make thousands of trips on the ambassador bridge each day transporting over $300 million worth of goods and it's not just this bridge. there's actually three bridges closed on the u.s.-canada border right now. indiana, north dakota, and of course michigan. so the impact is certainly being felt listen in. >> my truck is not as full today. and actually for the last three

days as it is before this all took place and i was full coming back every day >> the blockade shows the auto industry's reliance on these bridges for the supply chains. listen in. >> time is ticking every hour that goes by is costing us over 13.5 million in trade and irreparable damage to a reputation as a reliable trading partner. trade has played a wider role in building this region and the country's economy, and it has taken decades and decades of hard work. >> and losses are certainly being felt you have auto manufacturers being scaled back. gm has scaled back three ships just in lancing, michigan, alone. and they've even had to charter a cargo plane to get the missing parts that are stuck at the border on the other side of this bridge then you have honda, for example, they have two plants one specifically in oakville, ontario. they make the civic as well as

the crv, suv and they've had issues you've had ford that's had to scale back you're feeling it all the way in kentucky the toyota motor manufacturing has said they've had issues getting parts affecting certain model like the rav 4, the camry, the lexus. the list continues they're estimating $51 million in lost wages just this week alone. this bridge is huge. it accounts for 25% of all trade between canada and the united states and when you have so many auto manufacturers that are involved with just in time supplies when a good doesn't arrive just in time as we're seeing this week you have issues. officials on the canadian side have filed an injunction, but, unfortunately, a judge has delayed that hearing until at least noon today so the protests continue becky, brian >> christina, thank you very much christina who's there on site.

you know, this protest blockade at the border highlights the political divisions that two years of pandemic life have intensified. tom friedman joins us right now now. and tom, let's talk about this because there's a right to protest. and people absolutely should have that and i'm reading that in the newspapers this morning, talking about how ontario, the government is planning to take additional steps at this time. they're going to consider fines and even potentially consider taking away some of these trucks this gets to the heart of a pretty big problem at this point. >> right now we have a pandemic of the foolish and selfish what are the governments asking of these drivers get quarantined, get vaccinated, fully vaccinated or be quarantined. do it for yourself, do it for your neighbors and most of all do it for the doctors and nurses who have been completely exhausted after two years of this so you won't be putting additional pressure on them. and so i find all of this all

being done in the name of freedom -- freedom from who? from mother nature it's just -- it's just nonsense, and we're so late into this. it's so hurtful to the nurses, the doctors and ultimately to the economies. >> but, tom, they do have the right to protest >> they have a right to protest, but they should have a logic to their protest. i have a right to tell them their protest is stupid and selfish. >> but they represent a significant portion of the population in canada and the united states. this is not a small part of the population and they're angry over what's been happening over the last couple of years >> sure, i'm angry call mother nature, get her on the phone and say stop spreading this pandemic. we know the facts, becky, from the cdc. if you're 18 or older and not

vaccinated you're 60 times more likely to end up in a hospital and if you're not vaccinated and you're an adult you're 20 times more likely to die so those are the facts i don't care if you want to die for yourself, but maybe think about the doctors and nurses that we have basically crushed in the last two years because people won't get vaccinated. and what happens they end up in the hospital? and what do they then say to those doctors and nurses on their deathbed according to the american medical association, i wish idea gotten vaccinated immediatech. >> how did we get to that point? why is there no room kind of an intellectual conversation about what's happening especially when you look at the numbers of who's dying right now, who's winding up in the hospital >> that's a really important question, becky, and it'd be worth a whole two hours of "squawk box. the lancet recently came out

with a fascinating study which country in the world did best during the pandemic was it vietnam 100 million people, not particularly strong system, but what the study found was that it had a really high level of trust, trust in each other and trust in the government. you know, one of my teachers and friends likes to say trust is the only legal performance enhancing drug trust is the only legal performance enhancing drug if and if there's one thing that's happened to america over the last 20 years is a general erosion in trust, people in the government and people in each other. some of it's because government has gotten a lot of things wrong and experts have gotten a lot of things wrong and they deserve to be challenged. a lot of it i think is social networks we're now in the middle of an infodemic not just a pandemic driven by twitter and facebook and all these other social networks whose business model is to rage and divide people. and it has real health

consequences it has real societal consequences >> i completely agree on that. not letting people decide for themselves on social media i do agree on those points you know, vietnam obviously warned countries, maybe have an advantage. we know vitamin d according to the cdc, you know, has an advantage. the u.s.' numbers are not any worse than belgium or th netherlands or spain this is truly a global pandemic, but going back to your previous point about canada, and we can agree to disagree on this. it's two years in. don't these people have some human right to say enough is enough i mean they're clearly not going to get vaccinated, and by the way -- and we don't know if they're all non-vaccinated by the way, tom the vaccination rates are about the same here as they are in many other western european countries. they're just going to be a quarter of populations that

don't want to do it. i don't think this is a u.s. issue. >> i was not claiming it was a u.s. issue they absolutely have their rights, absolutely i don't dispute that for a second they also have responsibilities. also we're in an epidemic in america and obviously canada as well where everyone has rights and nobody has responsibilities. they have that right, but what is their responsibility? to their family, their neighbors and to the health workers. >> you tell me i mean, we can argue about what their responsibility is, but -- >> i'm telling you what their responsibility is. >> i'm tell you this, tom, i'm fully vaccinated, boosted. my family is fully vaccinated and boosted. everybody in my family got covid over new year's. some in my family have had covid more than once >> did any of them die >> no. >> did any of them end up in the hospital >> no, right now 52% of

massachusetts in the hospital with covid are fully vaccinated. that's publicly available data it's a great therapeutic, by the way. and i'm glad i got vaccinate because my symptoms were low what i'm saying is these are people who are seeing this spread ofome and saying, well, all these vaccinated people got it well, you're right, it reduces severity that's the key where is that government line drawn, though, tom, when the government says you have to do something and human choice. >> they all have their right to do this. i'm saying when you don't do it you massively increase the prospect you're going to end up in a hospital. you massively increase the prospect if you're in the wrong category that you're going to die. and in doing both, you know, the latest study shows about two thirds of nurses today are thinking of getting out of the profession that's because they have to watch over all this. >> maybe some of the best incentives -- i'm just trying to

think of ways to do this the right way. some of the best incentives are the financial incentives that have been offered. remember when delta said anybody who didn't get vaccinated on its staff would have to go ahead and pay for couple $100 extra a month for higher health care bills because the only people at that point that dealt were in the hospital were unvaccinated and it was costing quite a bit and amazon saying if you're fully vaccinate you can take your mask off, you don't have wear it in the warehouses anymore. but by the way if you get covid and your unvaccinated you will no longer get paid leave for something they think you should have control over. >> that's a good point you probably won't remember this, but the first time i was on "squawk box" after the pandemic began in march 2020 it was after a column i wrote to brian's point, that we have to approach this pandemic with a

framework and maximize two things if we focus entirely on saving every life from this pandemic we are going to crush peoples hopes, dreams, finances, savings in ways that will have long-term consequences so from the very beginning that's where i was i was not like just saying shut everything down. and that's been my position all along. by the way, when i articulated that back in march 2020 i was not a popular guy. that was not a popular view. it was basically myself and "the wall street journal" arguing that at the same time now we're two years later. we know what works for individuals, for families, doctors and nurses, what works for the economy. and that is get vaccinated that's the best way you save lives and livelihoods at the same time. >> tom, where do we go from here then because we're going to look back and realize that some of the

things we did keeping kids inside, we didn't know to be fair we didn't know. it looks stupid now. like, close the parks. the parks should have been open because we know outside good, inside bad so i'm not going to relitigate the past, but how do we go forward from this? and some of them have to say this we got it wrong just say it, we got it wrong the science hasn't changed we've changed. >> you know, it's really hard. it gets back to the point we were discuss about vietnam, a communist country. but we just so lost trust in each other, in communities, in our leadership again, some of that's because of government decisions a lot of it i continue to believe is the infodemic that so many people get their news now from either unauthoritative sources or from social networks like facebook whose business

model is to divide and enrage us and we'll get over this omicron. will we get over facebook? i'm not sure >> thank you for your time it's good to see you this morning. tom, by the way, is the author of the best-seller "thank you for being late, an optimist god to thriving in the age of accelerations. >> yeah, hopefully there's some optimism there about coming out of this hopefully and then not just revisiting everything we may or may not have gotten wrong. all right, a little under 90 minutes until this friday's opening bell on wall street. dominic chu, with a lot of some of this week's big winners >> i'm going to get to that in just one second. i want to get to one earnings headline, though, coming out in just the last hour or so and that is shares of under armor, despite the athletic apparel maker coming out with better

than expected profits and revenues it's shifting it's kind of fiscal year to a different point in the year, and they're basically saying they're indicating that supply chain issues continue to be a headwind for the company in the current quarter as well, so some of that taking the shine off the better than expected results on its quarterly basis. here's under armor shares down 1.5% as for the winners it has been very much the conversation you've been having with tom friedman, this idea we were trying to recover from the pandemic over the course of the past week would you believe expedia, united airlines and the inves co dynamic leisure and etf, ticker pej are up 11% and 16% respectively there's this notion right now given the tech volatility we're seeing a lot of that still and then as we do often in this hour of squawk, a check on our most popular ticker from yesterday's full session i'm putting this up here because

the ten-note treasuryyield for very apparent reasons comes to number one on the list yet again. and then walt disney affirms holding and twitter all in the top ten. the rest of the top ten on my twitter feed at the domino >> it's that 0.0007 of that matters on that yield. big market declines. right now futures are in the red, but nasdaq futures down about one tenth of 1%. plus elon musk giving his first update on spacex's achianhis big plan to colonize mars because why not? we're going to bring you all the details. stay tuned we'll be right back. means a more resilient grid...

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welcome back to "squawk box" right here on cnbc the big story as we prepare to wrap up this week is the surge in u.s. inflation and what it means for the markets, businesses and consumers president biden says that he will work to alleviate the strain on american's

pocketbooks. >> reporter: the white house has shifted its message on inflation in recent months acknowledging it may not go away until the end of this year and saying there's more the administration can do here's president biden in virginia yesterday >> i'm going to work like the devil to bring gas prices down, which i'm going to work to make sure that we keep strengthening the supply chain to bring across and everything else. >> reporter: the reality is the white house has exhausted the few tools it has available oil prices bounced back after an emergency reserve release. meat prices spiking again despite threats of corporate investigations and supply chain fixes, they won't be silver bullets. and now a new tactic pointing straight to the federal reserve. the white house says the strong recovery and increases means it's time for the fed to recalibrate that support a senior official pointing to the move in a ten-year yield as

evidence the fed should act. but jerome powell, now the acting chair of the fed is the opposite of a lame duck, accelerating a major policy change without congress' clear blessing raj cohen, the preeminent services attorney says the inflation underscores the need to confirm powell quickly telling me, quote, the chair is the leader in an effort to moderate inflation and there should fought be any question to the credibility and sustainability of the actions he takes. now, administration officials past and present tell me the one tool the white house didn't use was sorting out fed personnel sooner so thisdidn't become an issue. brian? >> thank you very much all right, so let's talk more now about this issue high prices in america for everything, what the white house should be trying to do about them and whether there's a chance government action could simply make things worse joining us now is tom perez.

i'm going to begin with you as well is there anything anybody to be fair to any political party, is there anything anybody can do to tone down inflation right now? i just don't see it. >> well, i think it's important to understand the context of where we're at right now we're on pace to have the job recovery occur five times faster than occurred in the great recession. that's remarkable. when i was labor secretary we were dealing with long-term unemployment issues because we didn't have enough stimulus. and so has there been a tradeoff in this moment, yes. if we had gone a little bit less on the american rescue plan and other stimulus bills, we might have less inflation but we would have millions of less jobs

so i think that's important context to understand as we move forward here you know, the economists i talk to feel like by the end of this year we will get a better handle on inflation, but what can we do now? i know here in states our governor for instance has the ability to extend hazard pay to certain employees. and he has -- he actually eliminated that hazard pay at the end of last year the hazard hasn't abated we still have so many issues here, and so that hazard pay could be useful helping people out. and i think we should really think, again, understand that we have been able to create so many jobs so much faster. 7 million jobs created last year, and is inflation an issue? obviously it is here but what we have to make sure we are doing is understanding that we have 4% unemployment. we have -- we have --

>> well, we're coming off an artificial low the idea we've got this huge job boom, tom, is because we've lost all the jobs in travel and leisure. it's coming off an artificial low. it wasn't a real problem >> no. i think it's important to look at context you know, look at the pace of the recovery during the great recession and look at the pace of recovery now. our pace of recovery right now is literally five times faster than the great recession because we made these investments. we need to make sure we're -- you know, these supply chain issues are very real, and the president is working his tail off to address them. what we have to do more of is make sure we're building things here semiconductor chips, building them here in america those things like that no, we can't do that overnight but those are things i think we all agree we have to do. >> especially we see supply chain issues in china, border issues in canada we're starting to wish we made more stuff here. but that's a long-term issue

i'll take the other side republicans are going to blame the democrats because we're a society of just blame. we have to blame everybody for everything all the time, but i'll give the democrats a break. i don't know who could do anything about what we are seeing right now across most of this for example, coffee it's because of drought in brazil coffee prices are up. we're seeing meat issues because guess what, not a lot of truckers to take it so they're passing those prices on. is there anything we can do in the short-term that is going to help the inflationary environment? >> well, yes i think first of all we need to see this is monetary problem president biden needs to call acting chair powell into the oval office and tell him i have your back, do whatever it takes to get inflation out and then we need to focus on what we can do to get prices down and to get workers back in.

we can get rid of regulation that interferes with goods and workers. we can get rid of the trump era taxes tariffs. there are tariffs on steal, tariffs on lumber. we can improve pipelines, exploration, fracking, all those signals will get the price of energy down. we can bring back the keystone xl pipeline. when it comes to workers we can speed visa approvals for guest workers, for people who want to come from abroad, for immigrants who want to be green card holders. we can have more legal immigration. we can roll back mask and vaccine requirements so that more people come into the work force, and we can say no more build back better. it pays people not to work by raising their taxes, and it pays people not to work at the low end by phasing out entitlements that end with -- >> fair enough, diana, but

there's also and there is some truth to this, the administration is not calling inflation inflation. they're calling it corporate greed. and they're saying companies are raising friess into the pandemic and that's the real reason and by the way, there are price increases. ceos on cnbc will talk about how they're able to match inflationary input costs by raising prices more. does the corporate sector have an obligation on inflation and to the consumer? or should they just do what's best for themselves? >> look, first of all they say inflation is transitory then they blame it on corporate greed. everybody knows inflation at this stage is a monetary phenomenon milton friedman said it, everyone has said it we know that the fed has a balance sheet of over $8 tr trillion that is just pumping out funds and this needs to end. and chairman powell need to know president biden has his back just as president reagan had his back when he got rid of inflation in the 1980s

>> tom, your take? >> well, i mean president biden has renominated chairman powell. okay, so we will get through that you know, the other thing i'd point out is the inflation here is not coming from the labor market there's next to zero correlation between wage growth and price growth workers have leverage now. that's good news they have more leverage than they've had ever before. we have a lot of quits but we have far more job openings and far more people taking new jobs and using that leverage they have used cars are by definition cars made years ago the inflation in used cars isn't because of price growth. one thing i take optimism from is that workers do have more leverage now than ever before. the point you made about some of these issues, i read a long piece about oranges and why has

orange juice gone up well, there's been so many issues involving weather and other things so not much we can do there, but i think there's a lot we can do to make sure we're building more things here, we're addressing those supply chain issues by making us competitive here at home there are a number of bills in congress that congress in a bipartisan fashion needs to act on so that we can be more competitive. i firmly believe, though, that we wouldn't be where we are on our job growth, on our unemployment rate but for the remarkably important work of the cares act is and the american rescue plan. five times greater pay -- >> the fact importing liquefied natural gas to boston harbor to make power because they don't have natural gas because they're 100 miles away from the biggest natural gas field in the united states does seem a little odd. thank you both have a great weekend we're going to hear much more

about inflation and talk rate hikes on monday when the head president james bullard will join "squawk box" for an exclusive interview. when we come back russia kicking off military drills in eastern europe what does this mean for the tensions over ukraine we're going to speak with h.r. mcmaster and get his thoughts on this next, though, we have more of andrew's interview with the uber ceo talking about the key issues this week, inflation and pricing power and what that means for uber stay tuned you're watching "squawk box," and this is cnbc

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if you didn't know it already yesterday confirmed it consumer prices are soaring with inflation up 7.5% year over year when it comes to corporate america most companies are grappling with how much of their increases to pass onto consumers. yesterday andrew spoke with the uber ceo following the company's investor day in new york city, and the two got deep into uber's pricing power. >> the unfortunate part of the cpi data is cars are costing more, fuel is costing more and as a result when you look at our pricing, while our pricing has gone up on average on a year on year basis growth bookings grew faster than trips earnings for our earners are actually increasing faster than gross books. so the two are related, and as

we scale the marketplace we're trying to get more of the earnings of the marketplace to our earnings there's a lot of pricing power out there, and i think there will continue to be significant pricing power going forward. >> when you think about that pricing power and where we are in this inflation story, how does that fit into your ultimate ability to capture yut i think is a 7% margin basis for the profitability target so the assumption as it relates to that incremental margin, which is, you know, for every $100 of gross bookings we grow we get $7 the bottom line as it relates to ebada we're not making any assumptions as far as pricing there goes we're assuming we're essentially priced neutral, which if there's inflation we price that down to our earners. the ultimate earning power of the company is more than that. we do have a significant amount of pricing power but the targets

we have in 2024 are early in our ultimate profitability we want to be growing even in 2024 we talked about growing top line 22% to 25% we want to be a 20% compounder for the next 12 to 15 years along with increasingly consistent margins so 2024 is not the end of the road it's just the beginning for us >> and what do you think about the path what might be described to true profitability, which is unadjusted >> yes, well we hit -- we started free cash flow profitability this year, right and i think true profitability, gap profitability is probably the year after you know, we were gap profitable this quarter if you want to be technical about it but ultimately we want to be free cash flow profitable and get profitable for the foreseeable future and i think with the road map we've laid out for targets in 2024 it's an absolute it's going to happen.

>> you can see that uber shares have turned around they're up by over 0.6% this morning. if you want to see all the interviews with the ceo you can do that by heading over to cnbc pro. coming up we're going to ask former national security advisor h.r. mcmaster if he thinks russia is waiting until the end of the olympics to make a move on ukraine or could this be a military exercise? let's get his take stock futures now turning green for the dow. you're welcome, america. we're back after this. c'mon caleb, you got this! and if you don't, there are other options! umpire: ball! good eye! good eye! eyes are good for lots of things. like reading!

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american citizens should leave -- should leave now. we're dealing with one of the largest armies in the world. it's a very different situation and things can go crazy quickly. >> that was president biden giving americans in ukraine a stark warning. it comes as russia begins military exercises with belarus, and world leaders and global markets wonder if an invasiono ukraine is next. joining us now is general h.r. mcmaster, a retired u.s. army lieutenant general who's now a senior fellow with stanford university's hoover institution, also a lecturer at stanford school of business and general, watching what he's doing right now do you think putin will actually invade, sore is this just a means for a

better negotiation >> well, becky, you know, he's already invaded. and we have to remember since 2014 7,000 ukrainians have died in this war as russia illegally occupied crimea and most of two provinces in the eastern part of ukraine. so this is really a continuation of the invasion and a use of what putin's strategy, his play book of disruption, disinformation, denial and dependence, right? disrupt with the threat of this invasion, the amassing of these troops and use disinformation. you hear him saying, oh, what do you mean we're being aggressive? this is really europe and the united states being aggressive against us and then of course just the sustained campaign of political subversion, and then of course the dependence on russian gas which is meant to reduce our will but i'll tell you, becky, we don't know if there's going to be a renewed massive invasion, and this is what putin wants i think is to accomplish his

objectives of restoring russia to national greatness, extending russia's influence once again across the former territory of the soviet union, and he'll do really anything he can get away with and push as hard as he can on as many fronts as he can to do that. and of course there's a great threat to ukraine now, but he's already occupied belarus with the forces he has there now. and he's caused a lot of trouble to balkans right now so i think he's becoming very aggressive in large measure, becky, i think on a sense of our lack of resolve. i heard you just play the president's comments i don't think that inspired a lot of confidence in ukraine or in europe, but the administration is taking some important actions i think to deter putin from renewing the offensive against ukraine. >> you point out the dependence issue, and that may be the biggest issue. our allies in europe especially germany are really dependent on

this russian gas, and we're not sure how much they'll go along with this if we decide to say forget it, step back that's part of the problem of all of this. how do you deal with that when any solution to german and european dependence on russian gas is something going to take years to fix >> well, let's not be our own worst enemy. let's not give really russia coercive power over our economies. i heard your earlier discussion about why the heck do we import gas from russia into massachusetts? it doesn't make any sense. and we have this propensity now to cancel pipelines here, cancel the canadian pipeline and green light a russian one. so i think it's really important that energy policy has to really take into consideration energy security as it relates obviously to carbon emissions and climate change it's very important that the eu now is considering natural gas as a temporary green source of gas, as a bridge away from coal and a bridge toward renewables

and it's important we reinvigorate nuclear power i think what france is doing is instructive. look at how self-destructive germany's energy policy is compare that to france what's sad about this, becky, are the solutions are here i think to make it false dilemma between taking on the threat of climate change and maintaining energy security, and we just don't access those solutions we -- i think we're driven to large measure in this area by ideology instead of what makes sense from a business and economic perspective >> general mcmaster, it's brian first off for putin it's weird he invaded during the 2008 olympics and went to the sochi and i don't know what his fascination is with the olimics and his timing imably he likes the world stage. who knows. you look at what's happening in the u.k., and they said they're

facing an energy disaster and that's what's happening. millions of people in england they have to choose between heating their homes or feeding their families because they may not be able to afford the heat because they've screwed up their energy policy, and now thir trying to furiously off start six offshore oil platforms after committing to climate goals in scotland you almost can't write a script like this. but how do we come together? the left and right are so far apart on this. is there some middle common ground where we can say we don't want to destroy the planet, but we don't want to import oil into boston harbor to make power. is there a middle ground >> there obviously is, brian how about real solutions instead of nonsolutions and recognize what we have to do as a manner of urgency is get off of coal. and the way we did that in the united states is the availability of cheap, natural gas. there are natural gas deals in europe, and you know what?

they're aren't developed why aren't they developed? a lot of it is the green lobby and hey, guess who funds part of that green lobby and leftist movements in europe? the russians because russians are actually deliberately trying to perpetuate dependence on really dirty russian gas a few weeks ago senator kramer and i coauthored an op-ed really suggesting there be some ort of attacks on dirty natural gas as a way to incentivize alternative sources. and of course as you know the u.s. can be a big source of natural gas exports as well. so i think it's really important for us to look at the resiliency of energy supply chains and then also look holistically at the interconnected problems of energy security and carbon emissions. we look at them separately, and it's worth pointing out if anybody gets an electric car in china, for example, and those electric cars are charged with

electricity generated at coal fire plants it gets a lot worse for the planet, not better >> that's exactly what defense secretary austin has been putting forward to he has been thinking about this. what are the odds looking at green energy and also looking at national security, that that is something that can be kind of both sides look at holistically? >> becky, it has to be another danger as we bridge to renewables, where are the renewables being manufactured right now? in china state support, chinese efforts to get an exclusive control on critical supply chains or battery manufacturing. so it's very, very important we counter china's status economic model that's been weaponized against us it's extremely important to combine energy policy, economic policy and national security policy now more than ever.

we shouldn't trade, you know, a new dependence on china that is reminiscent of the old dependence we had on the middle east for oil supplies. and i think that's -- we're in the danger of racing toward with energy and economic policies they just don't make sense they're not fully thought out. >> general mcmaster, thank you for your time. these are issues that obviously we're all watching very closely, and we'll see what happens the next few weeks, but thanks for joining us today >> thank you, becky. all right, coming up destination mars in case you forgot elon musk is trying to get us there but why? we're about to get the first update in two years on the huge ship somebody call matt damon because we've got morgan brennen coming up after this. stick around

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next week charlie munger is set to hold court at the daily shareholder meeting. as always he'll be answering shareholder questions. this time it'll be virtually and starting at 1:00 p.m. eastern time on wednesday. you can submit your questions today by sending an e-mail to daily journal questions at cnbc.com i'll go through all those questions and we'll ask as many of charlie as possible on wednesday. send your questions in today >> looks very cool look forward to that, becky. well, from munger to mars.

elon musk spends so much time launching rockets to the international space station it's kind of easy to forget he also wants to go to mars, and we just got an update on that audacious plan morgan brennen joining us now with more. are we really going to mars? i mean not you and i but somebody >> it's something, brian, the question is when so elon musk giving his first update on the spaceship in over two years unveiling the giant rocket system that's twice as powerful and this is a system that is fully and rapidly reusable at least that's the goal that's the whole holy grail on spaceflight. it's considered by some to not even be possible at least before spacex >> our goal is to be making at least a one-stack per month, and then ultimately, potentially a ship every three days. there'll be more ships than there are boosters because the

booster actually is the most gigantic will come back in about six minutes. excitement guaranteed. >> so this would allow starship to be launched three times a day. that's a cadence musk argues is critical to sustaining a human colony on mars keep in mind spacex is planning a record breaking 50 launches or about one per week this year with its existing rocket so to put it mildly this goal is very ambitious the more launches, the lower the cost >> fast forward like two or three years from now i think it's highly likely to be everything included less than $10 million a flight and not to a low orbit. >> and starship already has business it'll be used to launch spacex's own star link satellites, to fly a japanese billionaire and nasa is paying billions to

use it to land on the moon in the next several years first, though, this giant rocket system actually needs to reach orbit, and that hinges on the faa. musk said last night he expects regulatory approval hopefully next month from the faa, but this is a big question mark, brian, and one that if for some reason the faa decides to do a deeper dive in regulatory review could push back this time line by half a year or greater. >> it's good to talk about poosers in a different way by the way, i'm just going to get that out there >> oh, my gosh, right? >> so we know elon musk hat has a little feud with the president. you know, they sniped or he sniped at the president. the president finally talked about tesla. is there a lot of politics around musk, you know, visa vi the faa? does he feel maybe like he's getting a short shrift because he's elon musk, or has he got to wait in line despite the

billionaire status >> elon musk is a man who some experts might call color-blind in the sense he doesn't see red tape, doesn't like red tape. he doesn't have a lot of patience for the regulations that being said he did stress last night this is hinging on the faa. that update was given from south florida from what's called star base by spacex down in texas there are some residents still that live in the area. that's part of the reason why you're seeing these environmental reviews from the faa. and this is a system that just the booster piece of this rocket system, which is called the super heavy, when that actually makes its way to orbit, it will be the biggest and most powerful man made object to ever fly in space. so regulators are kind of taking their time with this process that being said he's already said it last night, if this doesn't work out in texas in the near term, that he's going to move this operation to florida to kennedy space center in cape

canaveral where there are no regulatory clearances and they can get starship up and running. >> morgan, we're watching the vid, you know, not video i should say, the simulation, the animation, whatever you want to call it. i know you've been down -- i think you've seen this stuff or at least you know a lot more about it give us an idea how big this rocket -- >> huge. >> i mean how big? he keeps saying it's the biggest thing to ever go into space. how big is this thing? >> okay, he was standing in front of one of these actual starship rockets last night. this thing stands at more than 390 feet tall. when you see images of the rocket stacked up on the booster, i mean people are like the rocket's here, people are like here. it's ginormous and it's so powerful you know, and you're talking about tons -- looking to get a million tons to mars using these rockets and reflying rapidly

multiple times during the day. that's the cadence he's looking to get to because that's what he believes it's going to get to get to a self-sustaining city on mars >> and the fuel and how much it needs, that's going to be interesting, too morgan brennen, always interesting. morgan, thank you. when we come back noah blackstein will help us wrap up the market and wall street we'll talk about more on all this what invest rrz to do in this situation stay tuned you're watching "squawk box" and this is cnbc and they want it all personalized. with ibm, you can do both. businesses like insurers can automate it processes across clouds. so agents can spend more time on customer needs. and whatever comes your way, you've got it covered.

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all right, welcome back. a good friday morning. let's get back now to why you're here, and that is the markets and your money dow futures, they are now moving higher they were down triple digits earlier. the nasdaq was down triple digits earlier yeah, basically flat butthey are in the green, so a bit of a turn around, and it might be because of some reporting by one mr. steven liesman about fed officials pushing back, maybe saying investors should expect more measured hikes than jim bullard may have suggested yesterday. steve is back with us. and steve, i'm not going to give you all the credit for turning futures around i'll tell you when you came on and talked about maybe it was an over hawkish view, the market turned i don't know if it was

correlation, i don't know. but i think it had something to do with it >> i'm going to report what i need to report and markets are going to do as you know what markets are going to do. our report finds several officials both publicly and privately are pushing back for supervised rate hike they're instead suggesting the fed might embark on a more measured rate hike path. fed leadership reporting by cnbc finds these officials either not supporting outright or very skeptical of that 50 basis point hike in march, which the market priced in after bullard's comments yesterday which follow the hotter than expected inflation report while there's a chance the committee could do that, these officials favored 25 hikes with the decision to accelerate the pace only coming later in the year if the fed doesn't respond to the actions atlanta fed president we reached

him yesterday after the inflation report he said, quote, my views have not changed and that's with three or four rate hikes this year likely beginning with 25. and that was the same view he gave on cnbc wednesday before theflation report. quote, i'd have to be convinced of the need for a 50 basis point hike cnbc reporting found most fed officials, they were already looking for a bad inflation number, and the january report was not that much than they'd expected they don't look for improvement until midyear or beyond. and the san francisco fed president mary daily, she also chimed in after the report saying 50 basis points growth, not my preference. so still five weeks before the meeting and the situation could change, obviously another inflation report to come but key officials even after the inflation report continued to hold for measured tight pg, not one that's kind of panicky

>> all right, steven, we appreciate it. thank you very much. let us talk more about this with our next report the fed is pushing back on maybe the super hawkish, eagle like message we heard yesterday. manager joining us this is where we are at the markets. we're hanging on every word by the fed. i think that alone kind of says something about where we are, that the hope-ium of the fed keeps stocks down. what are your thoughts >> i think that powell has been relatively pragmatic over the last little while. i think it's been right. i think the market has gotten extremely hawkish on the federal reserve. we knew what the inflation numbers were going to be this wasn't a surprise that they were going to be high and strong and you had tremendous consumer

demand for goods driven by three rounds of stimulus checks, debt for bearings, increased credits from the government. for two years you've been heavily stimulating the consumer you've run into supply chain issues so the persistence of inflation or how high it is is unknown federal reserve policy hasn't led to this inflation. central banks around the world have been pursuing the same monetary policy since the global financial crisis that's the low growth and low interest rates this has more to do with what fiscal policy was. as the things run off and as demand begins to taper, what's the sustainability of 45% year over year, price increases on used cars. i think that what they're saying today is important for prag pragmatism i think financial conditions remain accommodative so far. the yield curve is flattening and spreads are widening especially after the comments.

the federal reserve is -- they do need to be careful. their words can translate into major market impacts but i think the pragmatism of the chair is appreciated we'll have to see how the year goes but two-year interest rates are back to where they were in the summer of '19. ten-year yields are where they were in the summer of '19. and growth stocks are back at multiples of 2017 and 2018 a lot of the multiples have now -- >> and i know we're fixated on the fed and interest rates they affect so many things, but from a market, from a stock perspective, what's more important? rate hikes or the unwinding of the balance sheet? >> well, we haven't really unwound the balance sheet to any large extent so we don't know what the

overall impact of that will be we don't know what the term premium will beonce they start selling off bonds in large quantities or letting them expire so you're asking for a question where there's just not enough data i think that's why they're leaning to more rate hikes than they are to qt right now, because first, doing both at the same time, you won't be able to try and isolate the impact of one over the other and we really don't know what the overall impact of quantitative tightening will be. doing it at the same time seems reckless to me and doesn't seem to be their preferred method it seems to be rate hike first caused the end in qe, and then qf not until discussion until much later in the year so we don't know but we're seeing spreads widening more recently money leading high yield, for sure having said that, financial conditions aren't tight as of yet. and the economy and the consumer

balance sheet and quarter balance sheets remain strong so this is a very difficult needle to sled right here. >> sure. bottom line, though, before we let you go, can stocks still go up in the face of all this >> only mine only the stocks i own. if the fed -- if the fed goes too far -- >> i appreciate it what are those stocks? >> it's obviously i think the key risk for individuals to look at is to know if the fed has to go to far is to look at the slope and the shape of the yield curve. when it inverts, it's been a predictor of recessions than any economist you've ever had on or has ever written on the subject. so the slope of the shape of the yield curve is the most important indicator. if that's a sign, that's a difficult sign for stocks. i don't see that right now, but i'm going to be watching for it.

>> the inverted curve, you've got to watch it. some say it's predicted eight of the last nine recessions when we come back, we're going to tell you what to watch ahead of the opening bell on wall street. by the way, the futures have pushed positive today. we started out with the dow down by just over 100 points three hours ago. now it's looking up by about 61 points. "squawk box" will be right back. what the world needs now... is people.

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31.4 million americans are planning to bet legally on this weekend's super bowl game with the gaming association expecting $7.6 billion in wagers that's up about 78% from a year ago. it's fuelled by the growing localization of sports betting you can watch sunday's super bowl on nbc. coverage starts at noon eastern time as the rams take on the bengals in los angeles and coming up on monday, by the way, a special lineup of guests from the sofi stadium in l.a. ftx u.s. president brett harrison and sofi ceo will be joining us for exclusive interviews live from los angeles. also monday, we'll speak with the st. louis fed president. we'll get insight on what he's anticipating brian, what are you thinking here i'm dying to hear what he has to say. >> i was thinking about the super bowl >> also looking forward to the super bowl >> first off, it's going -- it's

a homegame this is going to be a home game for the bengals. there's going to be more black and orange in that stands. i'm not kidding. i grew up in l.a >> go underdogs. >> it's not a football town. the bengals, i love the 4.5. joe -- >> joe is there. >> will he be just partying all week in l.a. >> he was careful not to say that he was rooting for them, because there is this curse that every time he picks a team, they lose so i was happy for the bengals that he didn't say too much about it but yeah. >> it's been a tough 60 years for cincinnati sports, since the mid 70s, big red machine that's kind of it. b b burrows is a stud, though. >> he is i heard you took the bengals even without the points. >> 4.5 i'm 15-2 my last 17. i'm not saying bet i'm not a gambling analyst, but everybody else can throw out

numbers. why can't sni. >> we're just doing the pool at our house. >> thanks for having me, by the way. >> great to see you. thanks for being with me have a great weekend we're looking at the markets turning into the green dow futures up by about 43 points. they were down by over 100 when we started the show a few hours ago. s&p futures up 6 the nasdaq up by 25. by, everybody. right now it's time for "squawk on the street. good friday morning. welcome to "squawk on the street." i'm carl quintanilla outside sofi stadium premarket trying to go green here as markets reel not just from cpi but that increasing volatility and fed speak as goldman sees seven hikes f