vladimir putin speaking in the televised address saying the goal is to demidemilitarize and denazify stock futures selling off. oil prices near $100 a barrel. it is thursday, february 24th. remember that date 2022 "squawk box" begins right now. good morning welcome to "squawk box" here on cnbc we are live from the market site in times square. i'm rebecca quick along with joe kernen and andrew ross sorkin. we will get a live update from

moscow in a moment markets are responding dow futures indicated down by 720. nasdaq off 356 before you saw the losses, you were talking about deep declines nasdaq yesterday closed down 19.5% from the all-time high the losses today will put the nasdaq in bear market territory if we close at levels like this. s&p closed yesterday down 12% from the january 3rd record close. you see the s&p is cindicated down 2%. it is in correction territory before the additional losses of another 2.1% this morning. in europe, you can see the losses have been steeper across the board, you are talking about declines of 3% or greater. 3% for fotse in london. dax down 3.4%. the cac is down 4%

in spain, stocks off 3.8%. you are talking about the potential for the largest war in europe since world war ii. oil prices are spiking thoughts of any sort of additional condemnation or sanctions that would be put on russian oil. wti this morning is at $99.77. it was trading above $100 a moment ago brent is up by 8%. natural gas price is up 6% right now. if you look at treasury yields, at this point it is in the red as you anticipate. people are flocking to the safety trade ten-year is 1.85%. the two-year at 1.48%. if you are waking up vladimir putin announcing late

last night military operations inside ukraine appearing to stretch across the country with explosions and air raid sirens in major cities, including kyiv the ukraine president declaring martial law. president biden calling the attacks unprovoked and unjustified. saying he expects loss of life g7 counterparts will meet before president biden addresses the american people. the united nations security council holding an emergency meeting on the attacks calling for putin to pull back the troops russia says it is targeting military installations in the effort to what they are calling to demilatarize ukraine. i want to get to matthew bodner live in moscow this morning. good morning

what do you have as the latest >> reporter: good morning, guys. we heard from the kremlin spokesperson who says the russian operation is aimed at eliminating ukrainian military potential. in other words, this is intended to destroy ukrainian military. we are seeing an extremely large-scale operation and control of the narrative is a big part of this for russia. we are having a hard time understanding what is going on on the ground in ukraine. we are hearing some things from the ukrainian defense minister stating they are putting up a good fight that's not what we hear from the russian ministry ukrainians are abandoning and laying down arms any ukrainian soldier who lays down their arms will go on by. they are telling the public on russian television this is not a war. this is a special military

operation. again, aimed at eliminating the ang ukrainian military they are not firing on cities. they are not harming civilians they continue to deny they have taken any casualties the ukrainian claimed they taken down a few russian aircraft and soldiers all of that denied we are not getting a good picture from the russians. we don't know what is going on in ukraine here in moscow, the mood, i have to say, is interesting i was here in 2014 when they annexed crimea it was astonishing how popular that move was broadly speaking we are not seeing too much evidence of that now my very unscientific survey of the situation of my social network and extended networks. celebrities and artists and other public figures, this is not a popular action

i would describe the main mood in moscow as one of shock. i think only recently did russians start realizing that president putin was seriously threatening military action a few days ago this is all happened quickly in the minds of a lot of russians >> matthew, what is happening? it appears that putin has been lying to some degree throughout the past several weeks on all fronts at one point, he said he didn't want to move forward had a lot of people believing nothing would happen there are people in shock. some people believe this is a shock and awe campaign of that size and scale that we are seeing with much larger implications >> reporter: yes it is obvious this falls in line with the worst case predictions

of what we were fearing from the russian government they were sticking to the narrative. this is about donbas there are strikes happening across the country the objective seems to be some regime change described. you see a narrative of liberation is what we are hearing from the russians and we're hearing reports from across ukraine of attacks on various military installations they appear, like i said, they appear to look at a broader operation than peacekeeping operation in donbas. we are not anywhere near the end of this with some of the worst case fears could come true >> that's what i was going to ask. to the extent that is true, what does this look like? what are the expectations of

where this could go? we are hearing about cyber attacks as well. we are hearing about air profes united states expecting this not to go on for the next 24 hours, but days and weeks if not longer >> that's very true. russia clearly is hoping, perhaps, expected the ukrainian government would fall after the military is removed. what we are going to see is a constant raising of pressure until they achieve their political goals which appear to be regime changes. they have said openly that on the other end of this, the russian army will leave and ukraine will choose new leadership it is unbelievable to think it is that black and white and honest about it. they are using words like

denazification we are right now in air strieke. they can ramp it up to more air strikes and ground operations. we just don't know what is happening in the field right now. i think this logic of phased escalation from russia is what we are seeing so far and is likely what we will see in the future i say that because of the importance, clear importance placed by the russian government on control, domestically of the narrative. it is important this looks like some -- doesn't look like a war. no occupation. no bodies on the russian side at the very least and ukrainian side as well their preference is take out the ukrainian military and this ends it all really depends on how ukrainian military and ukrainians respond to the pressure they are now being faced with >> we will see

matthew bodner in moscow, i appreciate it. becky. >> joining us to discuss this is jack jacobs. the medal of honor winner and nbc news military analyst. colonel, the russians saying this is not a war. just invasion? what does it mean? >> it is a war no doubt about it. the question is how is it going to end we've been speaking a long time about putin's slow-walking this to see what kind of response he will get from ukraine and what response he will get from the west so far, everything we've done is something he's planned for and he can undertake the idea that he will eventually takeover all of ukraine, one way or another, is troubling to our allies as is any response that we may

have, including taking russia off the swiss system we have been told by germany, italy and other allies that they don't want to see us do that because it has a deleterios effect on the economies. we don't have a plan b we will not send troops in there. we will not fight anybody in ukraine. the only way we can respond is through economic means and putin will not stop until he gets what he wants this will also cause -- the irony is we can't effect what is happening in ukraine the only thing we can do is dire economic means both those and not doing anything troubles our allies our allies in northern europe

and baltic states and eastern europe if putin is successful in restructuring ukraine to suit russia's own needs, the same thing is possible among nato allies and worst of all possible worlds is if he is able to through this coercion to extract concessions from our allies. becky. >> why are our allies reluctant to remove from the system? why are they worried about the short-term economic pain in this instance >> they are only world ried abot the short-term economic system they figure the backlash from faltering economy is something that eventually will be able to be redressed without thinking about what the longer term

disd dysfu dysfunction. all politicians think this way some business people think this way. when you plan for tomorrow and not planning for the day after tomorrow, the consequences for the day after tomorrow can be very bad indeed. they are concerned about the constituencies thus the g7 meeting. we are having a hard time convincing the allies they need to get tough with russia, becky. >> we have been watching the losses which picked up in markets in germany and france and italy. all down north of 5% at this point. maybe this is becoming more clear to them. i hear your point about what you are saying with the idea that they are looking a day ahead, but not the day after tomorrow that's how they got into the situation where they are reliant on russian gas to begin with what is the alternative?

why isn't there a cyber defense or something we set up like the russians have done against the ukrainians >> we are good at offensive cyber. we are terrible at defense and so are our allies. we have no coordinated way to defend the outside government or government or any cooperation between the government and outside are not very good at dee and nor are our allies that is what the allies are concerned about and so are we if we use cyber means, we are concerned that russia, who is also very, very good at cyber attacks, will lower the boom on us, too. this is a concerning time and the usual means of protecting ourselves, usual means of seeking redress for these kinds of things, they don't play anymore.

the world is different now and we find ourselves in the situation where we don't have a way to influence others to do what we want them to do to do the right thing and back off putin knows what he is doing and where he is headed, becky. >> colonel, a lot of times the other side of the world is i inscrutable for us i'm just trying to get my head around what it means when the stock market drops 50% from a day. if they truly had an economy, can you imagine the wealth effect and we worry about a 10% drop or 20% drop and what it does to the wealth effect and the feedback on the underlying economy. that's not a concern for putin there is no democratization of

the stock market or calculus if you can pull this off or not?un. >> there is no democratization of wealth in russia or any other country that is autocratic putin has the people at large, i'll talk about in a second, and the other is cronies at the top of the food chain and oligarchs and they are protected a lot of wealth is stockpiled in russia, but off relatively small number of people for the large majority of people, there is no kind of wealth distribution or asset distribution we have in the west i don't want to sound

condescending or patronizing the russian people over a long period, through world war ii and the civil war period and before then have endured to hardship. i know this -- they're used to not having an equitable wealth distribution that has been concentrated at the top of the food chain. it is tough for us to envision a country like that. that's the way it is in russia. >> what about china and what they would take away in watching this play out? >> that's a problem. the world is watching, as they said many years ago. china is keeping an eye on it. china has its own problems and

it is starting to turn inward which is a sign they are becoming internally weak and trying to shore up the ability to control their own population. unlike previous years, china has the capability to control its own population, but capability of projecting its power. both our allies and friends and enemies like vietnam have been asking us to resolve in defending the western pacific against chinese expansion and incursion. we have tried to do so, but china is keeping a very close eye on what is taking place in eastern europe if we demonstrate, by we, not just the united states, but the west at large, demonstrate that we are incapable of influencing action as close as western europe is, as eastern europe is to us, they will be convinced we

are not capable of exerting our infl influence. yes, the world is watching >> colonel, to the extent that the u.s. and allies do something, what is the potential for retaliation and in particular cyber attacks on the united states and what you think that means theimplications of that? >> i think we can see cyber attacks in any case. first, against western europe. there have been some already they have been testing them out in ukraine and other places. we are going to see probably widespread attacks at least at the beginning to test to see what we're going to do about it and what we can do about it. one of the arguments against yanking russia off the system early on is we have no plan b and if things like cyber attacks

occur -- widespread cyber attacks occur -- we will have no recourse then but to have counter attacks and then we're in different terrain none of us has any experience in the kind of warfare in which it is all cyber or mostly cyber if we use -- not my argument -- but those of our allies which have their axes to grind, particularly in the u.s. senate, said if we take them off the system now, we have nothing else and cyber war is the next thing to happen and we don't have a plan for that. >> was putin correct in the calculation that this is pain we can take and we eventually run out of options and he wins >> it appears he has more patience than we do. he has more patience than ukraine does he has a lot more patience than the eu does.

he's calculated exactly correctly so far we will only do what we can do to protect ourselves, but not enough to get him to do what we he want him to do. so far, he has been absolutely correct. >> colonel jacobs, thank you for your assessment this morning >> my pleasure coming up, u.s. equity futures plunging on the russia invasion news. we will show you which stocks are hit the hardest. that's next. as we head to break. check out gold prices jumping at the highest level since november of 2020. we have not mentioned bitcoin. down $35,000 as people go to gold, but not crypto you are watching "squawk box" on cnbc live from the nasdaq market site in times square. >> announcer: this cnbc program is sponsored by baird.

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welcome back u.s. stock futures plunging overnight. stock marjkets plunging around the world. russia invading ukraine. is certainly fits now, dominic chu, for what is happening tell us what is moving >> as we take a look at the

market reeverberation to your point for the s&p futures. a decline throughout the course of the session the lowest point we saw was 2:00 a.m. eastern time for s&p 500 futures. down 2.5%. we are hovering near the lows of the session. the s&p 500 futures has been a move lower on the trend basis over the course of the last 24-to-48 hours the levels are lowest levels we have seen going back to march of last year to give you an idea of context. from the macro side of things, some of the individual names catching a bid this morning are tied to oil and gas. majors in the u.s. chevron up 4% in trading so far today. exxon is up 3.5% some of the energy etfs.

spdr trading to the upside ice brent crude is up $104 a barrel first time since 2014 brent has been above $100. at one point in the last hour, they were above $100 a barrel. that is playing out in energy. the treasury yield has moved lower across the board benchmark ten-year is 1.86%. down 12 basis points you see moving below the 2% level we have been eyeing. by the way, that translates into a .10 increase for the treasury yield note flight to safety in bonds is there as well. maybe the flight to safety used to include cryptocurrency. joe, you made this statement earlier.

bitcoin and ethereum and alt-coins are reacting negatively to the down side. off 7% for bitcoin $35,000 per coin there trying to test the levels we have seen over the course of the past couple months here with regard to the lows the level everyone is watching is the lows we have seen over the course of the past two months joe, we will continue to watch bitcoin prices diff diverging when gold is going higher. >> that is the overall move, dom, is the knee jerk reaction to buy dips during geopolitical tension and in the past, it has been a pretty good idea to do that that is scary moments. first iraq war afghanistan. second iraq war. i remember bill clinton and kosovo with a couple of instances. it made sense to buy it. does this seem like it could be

qualitatively different? the biggest military action since world war ii i don't know it's that simple this time. i don't know what it means for inflation. i don't know what it means for the bond market. >> speaking of inflation on the commodities. pisani was saying the bulls out there saying maybe the fed won't raise rates as quickly they won't do that with the moves happening. >> right. >> you start wondering if there is a point with invert yield curve with the flight to safety. >> i hope it is like the past, dom. second biggest country in europe if he is going full boar and rebuilding the soviet empire, i don't know if this is a blip >> not just that, to your point and becky's point now.

ukraine is the biggest producer and exporter of corn and wheat in all of europe it is also a huge land mass as you have pointed out already, we show oil prices all the time we show the macro markets there. we have not shown wheat. wheat prices up 5.5% oat prices up. palladium and platinum are surging. we talk about the surge with inflation. policymakers will have with the fed is if you have the risin prices, you have to do something with rates, maybe. is now the time to do it it is not simple as buying the dip. joe, geopolitical risks over the longer term smooth out the issue is what timeframe do you have if you needed money tomorrow >> i will say i have been buying

stocks this week and continue today. if you are worried about inflation, you don't want to keep your money in cash. >> i'll have kyle bass on longer if you want to open up a new thing. russia had to have something on the border with china and now they are bffs. now they heare trying to hurt america. when would you take taiwan >> joe, to your point, if in a hypothetical scenario, in a hypothetical scenario, where this doesn't go from russia-ukraine, but does in some way change the narrative more hawkishly between china and taiwan, you could see a bigger market selloff there if that were to happen. it is nothing in relation to the size of ukraine or troops on the border, but it changes the dynamic in many ways for the

asian economy and specifically the tech-heavy trade that drives much of the markets overall. in asia, this is not in any way, shape or form that taiwan is in play you talked to colonel jacobs, if there is a changing atmosphere with russia getting closer together and expand then it becomes a broader market >> china has a wealth i think they would care if their stock market went down 50% in a week they need a global economy maybe they can put a governor on putin. i don't know that's sick we have to beg the chinese to help us out now, dom. thanks andrew let's talk tech stocks they are hardest hit as dom was saying we get reaction from dan ives from wedbush

has the baby been thrown out with the bath water? by the way, you look like palo alto that stock is down this morning. does that make sense >> first off, in geopolitical events like this, shock events we have seen over the last 20 years, this is more the opportunity to own tech if you are able to navigate the risk. i believe it is the most oversold tech stocks since 2015. to your point, when you look at areas like cybersecurity, you are seeing the tale. we are talking among enterprise and the beltway looking to de-scale or palo alto or others. i don't believe this is the time where this is the start of the broader trend that will fundamentally changemen

you will see the risk off. you look at the winners like microsoft and oracle or apple. that's how you navigate it. >> fair or not fair to start to raise issues about taiwan, for example? that is on a road map of something we have been talking about for some time. i think the expectation was a longer rope there, maybe that would be 2025 or 2026 event, if that, at all does this change that? is this a dress rehearsal? >> look, obviously some will think that we think when you look at the events on the percentage basis, i do believe you will see a knee-jerk reaction withinvestord

be an option you look at what it has as an impact with russia and you are starting to see a market that is baking in a worst-case scenario. you buy selectively the winners during these time periods. specifically software and semis and large caps rather than the time to get out of tech. >> for you, is this grab everything buy the index? buy the nasdaq what would you be doing? >> i told you last night at 11:30, i'm talking to investors across asia. this is the table pounding on apple. you own names like microsoft and oracle you own cybersecurity in palo alto and zscale or crowdstrike this is one where we look back and this is historic and founding time, but this is the

opportunity rather than the time to panic >> dan, do you have a take on crypto we were talking to mike yesterday. he said bitcoin and he is right, said it is trading look a nasdaq stock. not trading like gold or anything at all. it is directly correlated. >> that is the scary thing you go through periods like this and look at it as a hedge. the fact that it is almost with nasdaq you see the rotation of bitcoin as risk asset, but they don't have compared to tech task flow storage or valuations that you can depend on. that's the reason you want to own apple and microsoft and others there will be a scary period for bitcoin. >> dan ives. thank you. >> thank you becky. >> when we come back, we will get the latest on russia's

invasion of ukraine. we will tell you what we know so far and get a live report from hadley as we go to break, wti was trading above $100 and now at $99.37 all this happening with the tight oil market and concern of what comes next with any potential sanctions on russian oil. chevron is up 4% conoco is up 3%. occidental is up 4.5%. bp is the lone down at 4.2%. "squawk box" be right back >> announcer: executive edge is sponsored by at&t business keeping your business connected.

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good morning welcome back to "squawk box. we are live from times square. breaking news overnight.

russian president vladimir putin announcing the start of the military operation against ukraine. russia's military has taken air defenses off line. a lot of information to sort out. stock futures have been plummeting the dow futures are indicated off by 830 points. s&p down 104 nasdaq off 111 the nasdaq was almost in bear market territory yesterday the close yesterday put the nasdaq down 19.5%. this morning, down another 3%. dow yesterday was down 10% in correction territory. s&p is now indicated down another 2.5% as well the markets here are faring better than what is happening overseas in europe

you are seeing more extreme weakness germany down 5.1% for the dax. france down 5% as well italy down 4.97% ftse in london is down 3%. if you look at the price of crude, it has been sky rocketing. the expectation there could be additional sanctions against russian oil in the market that is tight wti up 7.8% to $99.31. we traded above $100 a barrel this morning brent crude up 8.1%. andrew let's get over to cnbc's hadley gamble. she spoke with the ukrainian foreign minister this morning. hadley, good morning >> reporter: good morning, andrew what i heard from the foreign minister in the conversation from the tarmac as he was set to fly back to ukraine from washington he said this is an attack on the world order. he called on the western nations to fiercely, his word, to

fiercely ice isolate russia. this is the man who called for the world, the west, the united states and nato and eu to impose sanctions before putin could get the troops on ground what we saw earlier in the week, as you know, sanctions, but not quite what the ukrainians were hoping for ukrainian foreign minister saying what we want now are receive heavy sanctions by the west. he also told me that when it comes to ukraine, what they need right now are more heavy weapons. they also need continued financial an assistance. they need more commitments from the west and united states in terms of basically keeping the lights on at this point. this all comes a few dpaew days the conversation with the opec plus ministers that was in cairo. i spoke to the uae oil minister

and sasked if they had a plan we have no way to make up for the shortfall of russian oil if that occurs. all of that has got to be weighing on oil prices lots of questions of what they are hearing from the counterparts in russia arn nd w this means going forward eventually, the foreign minister was originally supposed to be in washington for meetings and go to new york to plead the case before the security council. he had to changes plans. he is on the way to istanbul he cannot get a flight to kyiv he has to go to another country and get across the border by car. high drama for this foreign minister as he heads home. >> hadley, you had been talking to officials for weeks as we have telegraphed this.

do you get a sense of meaningful retaliation of nato and united states and allies? are you hearing anything to believe that does he really expected that or does he have to say this publicly hoping and doing that really for the folks at home >> reporter: it is fascinating if you look at history look at what vladimir putin has been doing for 20 years. first georgia and crimea and now ukraine. the question, of course, going forward is will him calling the bluff of the u.s. and other leaders lead to concrete sanctions? i spoke to ursula von der leyen and she said all options are on the table. energy sanctions should not be part of the package according to others, but she says it should that is playing out in the german market. when i spoke with olof scholz over the weekend on saturday

he reiterated the same thing he kept saying diplomacy, diplomacy, diplomacy it was the frantic diplomacy when the under secretary of state meet with the foreign minister she said at that time the only thing that would mean something is if all of the troops on the border would return to are barracks that did not happen. we can say this was the ultimate failure of diplomacy, guys. >> hadley gamble, thank you. i appreciate it. joe. shares of ab-inbev are lower this morning despite posting results for the quarter and year which were better than expected. guidance for commodities like soybeans and wheat are soaring in the attack on ukraine joining us now is ab inbev ceo

we'll start out, your russia business, obviously, you are global you sell one out of every four beers consumed on the planet which is amazing your business in russia is joint with a turkish company that is not material at this point, but the rest of the world we want to talk about, i guess >> sure. thank you for having me here of course, this is, in a way, important. our priorities are with partners and safety of our people when you think about the business oversauall, we announc the fourth results double digit growth top line and bottom line. very strong cash strong momentum that we have

incoming as we approach 2022 >> michel, there have been narratives that beer was going to decline in popularity you, yourself, at ab inbev, have not seen that. beer is very popular also recent acquisitions that created the giant company that took on a lot of debt. can you speak to you having enough money to grow more quickly and innovate and market all of your beer offerings and still reduce debt over time? >> joe, this is a great question so beer is a big category. very profitable. globally gaining share so it is improving position of strength in the market overall. a lot by emerging markets, but in developing markets, we see

the category which is healthy. our position is moving from leaders in the category to leading category growth. we have been investing a lot in initiatives to improve our products and our portfolio and to expand that category. during that fourth quarter this year, the results we announced, we achieved all-time high volumes for the company which is one more proof that beer is big and growing and gaining global globally our portfolio continues to grow as consumers evolve and we are adapting innovation is 10% of our roevene last year. we are leading in innovation across most of our markets >> michel, we don't have a lot of time.

a couple of your peers warned about price hikes and how it could hurt beer consumption. you did not mention global inflation or increased input costs. they could get worse with the latest news that we're having hg out of the ukraine in terms of inflation. could you comment on that and prospects for margins and price hikes? >> we've been operating in a very challenging environment and when you put this all together in the last two years i'm very pleased with results. as a company we've been agile and flexible in adapting to conditions and we put all this together we delivered double digit top line and bottom line last year our top line was 15% ahead of

our bottom line, as it is our outlook for this year. but we've been managing these dynamics very well and i'm very proud of our team, and all the investments we've made over the last few years, improving data, becoming more tech force cpg, so we can put more brands to work with the right data, right technology to be more efficient. >> i'm sorry we -- so much happening. we want to -- i hope we can have you on again soon, and this is the beginning of a long relationship and in better times. next time we can just focus on beer, which i'd like to do but we've got other things happening. we appreciate your time this morning. good luck. thank you. >> thank you, joe. have a good day. coming up, futures deep in the red this morning we're going to talk about what to do with your money this morning. here's a look at the biggest

premarket s&p gainers this morning, and let's also show you the losers you're looking at marathon oil up over 6% live nation up over 5% and diamondback energy, mostly energy companies but then you look at the laggard side and look at ebay. back after this.

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we're trying to make sense of what is happening in ukraine. right now futures down sharply on this news of russia's attack on ukraine comes as the markets had their fifth straight day of losses yesterday. our next guest says he doesn't think this correction has run its course, but he also doesn't expect a new bear market thanks, sam. we're all trying to make sense of what is the move, if you will, and how you see it >> good morning, andrew. well, certainly there's so much uncertainty out there investors are saying let me sell first and ask questions later. but when you look at the magnitude of the decline, the number of days it's taken to eclipse that minus 10% threshold, with all the

uncertainty that's surrounding us, in many ways i'm sort of surprised with the orderly withdrawal if you will from the equity markets so my implication is that we probably will see a deeper correction before all is said and done but i'm not really looking forward to bear market if one does occur it's likely it be shallow >> we've seen big stocks, big tech stocks have come off. at the same time we're seeing like cyber security companies like palo alto networks, that is also off so the question is are there companies selling off that shouldn't be and are there opportunities you're looking at today? >> well, i think many of these companies deservedly have been sold off because they were trading at such extensive multiples, and what we have found traditionally is that there's a negative 0.5

correlation between the yields and p/e ratios it's not surprising to see pe contraction but like a one-two punch i think what we're seeing is a continued p/e contraction but i think now investors should be looking at areas that have been beaten up the most such as semiconductors, such as software and looking to start to nibble in there and if you wanted to take sort of a defensive approach, looking at staples and technology is typically a fairly good approach over the long haul, getting about 96% of the return of tech but less than 40% of the volatility >> how does today's news change or not change the dynamic you think inside jay powell's brain

and the federal reserve and what they may or may not do next? >> i think it's one of moderation that rather than starting off with a 50 basis point hike going back to 1990 we've had five interest rate cycles meaning rate hike cycles, and in each one of those the fed started with a 25 basis point increase, and it usually didn't go to a 50 or 75 basis point hike until the third or fourth rate hike in that series so i think that they're going to take more of a moderated approach, hike three times between now and the end of june, do so by 25 basis points each, and then two more for good measure by the end of the year but i think they will hike they will keep their pulse on the economy, on the market, et cetera, and do so in a measured pace >> is it worth trying to price the risk of a much larger situation here, rather than just

think about this in the context of the russia-ukraine invasion but to think about the implications of what youthink happens in china we're talking about semiconductors we talked about taiwan earlier you talked about how you thought there's an opportunity in semiconductors if you think, however, there's actually a much larger scale of war, if you will, at play, would you still have that view >> well, you can obviously throw in an awful lot of variables that can sort of imp ply the world is coming to an end. but in many cases you have to think about blood in the streets and when it tends to be the most opportune for investors to dive back into the marketplace. i think what's likely to happen is that we are going to see a testing of the deeper correction area a lot of technicians are talking about a head and shoulders pattern, talking about retracements and what not that

could bring the s&p down to around a 3800 level, which would be another 8 percentage points from where we are right now, but i think investors have to realize maybe that won't happen. what you do is you take yourself sort of a measured approach through dollar cost averaging by nibbling at these opportunities as they make themselves available. >> sam, appreciate your perspective this morning hope to talk to you very soon. thanks >> good to talk to you, andrew it is 7:00 on the east coast, and you're watching "squawk box" on cnbc live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. our top story this morning, russia launching an attack on ukraine overnight. with explosions and air-raid sirens heard in major cities including the capital of kyiv. russia claims it's only targeting military institutions in an effort to what they call

demilitarize ukrainian and says it has not attacked cities or civilian populations putin also saying he wants to de-naziify ukraine of course it's probably worth pointing out that ukraine's president zelenskyy is an elected official who also happens to be jewish president biden calling the attacks unprovoked and unjustified. let's go live to kayla taushe in washington for more. >> reporter: president biden will address the nation. he spoke with president zelenskyy overnight last night this morning g7 leaders are going to be holding an emergency virtual meeting discussing costs after events overnight nato allies will convene in short order as well. one european official telling me we need to go all in on sanctions. a u.s. official echoing that saying full-scale action is needed up until this point officials

have warned it could worsen inflation, and blocks on swift payments could upend too much commerce, but of course the events of last night have changed all of that. blasts ringing out across the country as troops move into ukraine from three sides air strikes killing several dozen ukrainian soldiers according to nbc news. and president zelenskyy on twitter urging plain clothed citizens of the country saying the country will provide weapons and saying be ready to support ukraine in the squares of our cities in the capital of kyiv, traffic at a standstill as residents are fleeing, one telling me he's stunned the worst-case scenario has arrived, and russia experts, guys, are saying it is unclear to see what the short-term end game is here now that a full-scale invasion has been launched becky? >> kayla, we spoke earlier this morning with colonel jacobs, squhee pointed out a lot of this has to do with the ability to

withstand pain in the short-term we're talking very short-term if you look at oil prices today above $100, that's going to lead to higher prices at the pump obviously europe is in a much tougher position because of their reliance on russian natural gas as well. what do you hear just in terms of the resolve, the willingness to withstand some of the immediate pain >> well, it does seem there is quite a bit of willingness to withstand that pain. a former russian official was speaking to nbc news' keir simmons a few days ago saying that the actions as announced so far are simply not enough to deter putin. that's one of the reasons why president zelenskyy over the weekend was urging the west to implement the full range of sanctions now, not to wait for an invasion, but that was not the u.s.' and the west's strategy all along they believed just holding out those sanctions was enough to deter an invasion. they pointed to what happened in 2014 noting that the drop in the ruble, the higher borrowing

cost, the inflation at that time was enough to keep putin from taking over kyiv that time, so they believed even more stringent measures would go far enough this time of course we've seen that has not been the case, and we'll see what the western allies announce later today. >> i guess the pressure points in russia maybe they are willing to go with that. i guess the question becomes will the nato and its allies remain together, will they be willing to take this shorter term pain as well? if you're germany, if you're united statesed, if you're kind of looking at your population dealing with higher costs, are you willing to deal with those higher costs in the short-term in order to stand up and present a united front >> yeah, and so far, becky, the answer has been no we heard a senior administration official tell reporters that spill over effects specifically with regard to cutting russia off from the swift payment system was too high a bar to get a lot of those allies to clear certainly we've also heard the

white house say there are 30 nato allies, so you could see 30 bespoke packages of countries deciding exactly what pain their citizens can withstand but we will see what they end upcoming out with and what the fabric of this package ends up looking like overall >> kayla, thank you. for more of the market reaction to all this right now we bring in mohamed el-erian. you're talking u.s. markets off by 780 points for the dow, talking about steeper declines in terms of percentage losses when you look at the european markets today. is this a justified response or is this a situation where things look pretty grim right now but things could turn around quickly? >> good morning, becky it is an understandable response i mean, think of threeimportan things first the invasion has unleashed

a whole host of geopolitical forces that operate at multiple levels just a few minutes ago joe was talking about what does that imply for china and taiwan so we've unleashed a host of geopolitical questions second, most people thought this was a tail risk. even yesterday people were dismissing this as unlikely. and third, policy flexibility especially among central bank is very low so when you put these three things together there's a wide range of potential outcomes. this has to be priced into markets, so i think the reaction is totally understandable, and it's going to continue to be an incredibly volatile time for financial assets as they try to figure out what's ahead. >> mohamed, one of the things we looked at earlier were rising grain prices if you look across the commodities not just grain prices but also at some of the

metals you are seeing sharply higher commodity prices today as well and that additional inflation pressure probably puts additional pressure on the central banks as well, even if the central banks would like to slow things down, slow their hiking of interest rates because of this potential war, they're going to have a tougher time doing that because they're going to have more coming from the inflationary pressures to kind of force their hand. what does that mean? >> well, it means that policy flexibility is limited you know, there's an old saying -- well, central banks had the potential of regaining some policy flexibility a few months ago they didn't. so they look at this it's not just inflationary, becky. it's stagflationary, and that's the worst news for policy makers, because what this will do is it will lower global growth, and it will increase cost for inflation

people underestimate how important russia and ukraine are through the supply of commodities. as dom said it is way beyond energy it's wheat it's nickel. it's a lot of commodities. so this is a major stagflationary blow to the global economy at a time when the central banks and the fed in particular don't have the ability to react quickly >> what would you anticipate the next move being from the fed in that case? >> so this takes 50 basis points completely off the table it takes the eight, nine hikes that a lot of people were talking about for this year off the table and thankfully so because you heard me say on your show that i didn't think the u.s. economy could accommodate and live with such slamming of the brakes of monetary policy. it meenlz the fans the fed is g

have to have to be even more careful and tolerate inflation nobody wanted to be here, but we were already far away in the world of best in terms of monetary policy and now we're going to get further away. we're going to have a very sort of unsatisfactory situation when it comes to inflation and when it comes to growth, unfortunately. >> mohamed, i've had very smart investors explain to me when you're dealing with inflation as high as we have already, 7% plus, that you're already at the point the only way to resolve this inflation picture is to put the economy into a recession do you disagree with that? >> so historically that's been the case historically when inflation gets this high and the federal reserve has lost its inflation credibility and has lost the policy narrative, they are forced to slam on the brakes so historically that's been absolutely correct the question right now is would they do that in the midst of a

geopolitical shock i put out an article in the financial times earlier this week and i said you look at the probability it's pretty even between whether they slam on the brakes or alternatively they tolerate higher inflation and just push the problem down the road you know, we've talked about this over and over again this is the situation everybody was afraid of. by being late you have fewer policy options >> you referenced china, and we do talk about china a lot even though it's a russian invasion but because it seems like we have challenges -- the united states has unique challenges with both but also together it seems like we now have challenges so i'm trying to figure out, mohamed, how much of the stagflation you're talking about going to effect us and the global economy, how aware is china of how it could impact their own economy, the move with

russia, and we always heard they were an export economy they're trying to switch to a consumer economy can they be all domestic they can't they need to play on the world stage, and this seems like it's not great for them and with that in mind i'm wondering whether that would cause them maybe not to add to the problems with the move on taiwan, but maybe it actually causes them to not add to the global instability at this time. or do they say, hey, we might as well do it now >> so we certainly hope that they realize they're going to get hurt from this, and they shouldn't add to the global instability at this stage. they are a commodity importing nation, sole they're going to get hit hard this will lower their growth i think that's undeniable. what we have trouble with in the west and that's the mistake we made in sort of down-playing the possibility russia would invade

ukraine. what we have trouble with is the longer term horizon that china and russia take. so they think in longer terms. they think in short-term pain if they're pursuing longer term objectives even if china doesn't do anything with taiwan, and i think the probability is they won't. but even if they don't, you are looking at an attempt to reorder the world order -- to reorder the way political alignments work in the global economy there's some countries going to get stuck in the middle that have relationships with all three that are going to have to make some really difficult decisions in the weeks and months ahead >> mohamed, i want to thank you for helping us try and understand all of this this morning. >> thank you, becky.

coming up, continuing coverage of this russian invasion of ukraine, and what's likely or possibly going to happen next. overnight russian equities stalled the most on record erasing more than $150 billion that says something, doesn't it? that's a bad day for one of our high fliers, $150 billion. "squawk box" wilbeig bk.l rhtac ♪ ♪

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our continuing coverage of russia's attack on ukraine will continue in a moment but right now an important interview with the ceo of laderna with meg terrell

>> laderna reporting a big beat for its earnings the ceo joins us this morning. thanks for being with us on a very big morning for the world also making news this morning with your earning report tell us about how the pandemic is shaping up in your eyes what it means through the rest of year for boosters. >> as we've seen with delta it's always possible to get the more virulent variant so we're in an endemic setting where people are going to need boosting and also people don't want to be sick.

now $19 billion is higher than what we saw last year. $17.7 billion last year. the actual number is higher. but it's a reasonable number what could happen. and a lot of discussions ongoing and so we are working in this endemic setting, and we're working to develop additional vaccines and as soon as we getthosis we'll move into phase three, and we're investing in

manufacturing. we are increasing subsidiaries we had 11 last year. we're going to have 20 this year we've already done agreements with canada and australia and discussing many more possibilities to do that and being operated and funded by moderna, and vaccine agreement for supply where we can keep adding more and more to our annual booster >> one group, of course, still waiting here in the u.s. for a vaccine is kids under 5, setback for pfizer and now we're waiting a little longer for that moderna had said you expect data for kids ages 2 to 5 for your

vaccine perhaps in march are you expecting that time line and do you expect perhaps those data could lead from an appearance from the fda quickly? >> we're still expecting in march over 6 years or 5 in age and we started to work last week 6 to 11 approved as well >> and the question whether this is really sort of the end stage of the pandemic depends on whether we see variants and vaccinations around the world. there are reports suggesting that africa's cdc is going to ask to pause vaccine donations there because they can't deliver them to peoples arms fast enough how concerned are you about that situation and what risks that

poses to new variants arising? >> so i'm worried about it, and i think this is a piece we should have as a world prepare better it was very clear we were going to be vaccine supply constrained which is what happened but as we talked about in your show in the fall i predicted in the november, september time frame we move and including chinese vaccines as well and i think the world has prepared enough for low income countries. so today we have a lot of vaccines around the world and they're getting in arms and as you say this increases of the chance of a lot of new variants popping up >> thank you very much

becky? global equity markets responding swiftly to the developments in ukraine as russia launches an invasion. reports of explosions in cities across the country there including the capital city of kyiv all of that roiling markets as you can see. u.s. stock futures pointing to a sharply lower open as the major indexes are set to push even deeper into correction territory, and in the case of the nasdaq pushing into bear market territory nasdaq right now indicated down 400 points, dow futures off about 800 points, and the s&p down right now of course the volatility index spiking on this news as well it's up almost 20% just today. 37 is the last tick for the vixx you can see the ten-year right now yielding 1.86% the two year right now and then gold hitting its highest price in a year. right now gold up by almost $50.

it's not just gold wheat prices surging to a nine-year high this is because wheat is a major crop in ukraine. big concerns about that, up by about 5.6% this morning, and that's the case with other grains as well including corn. then if you're watching the dollar it is indicated up by almost 1% this morning, and oil prices also jumping on the news. right now you're looking at wti just below the $100 barrel it did cost $100 earlier this morning. brent is above $100 at $104.31 we'll be talking about crude prices, the impact of russia's invasion of ukraine and prices at the pump. "squawk box" will be right back.

welcome back to "squawk box" this morning oil in focus as russia invades ukraine, and as of now no disruptions to pipelines in europe but markets are on edge joining us now the global head of commodity strategy and cnbc contributor. we should talk about commodities, let's talk about oil specifically when you think where we are and

i know we've bane waiting for the past week or two now about what would happen here, when you think about the worst-case scenario just so we really understand the risk at play here, what does that look like >> the worst-case scenario that the russia seeks to weaponize i would say not only their oil exports but all their commodity exports. i mean, russia is the largest exporter of wheat. ukraine accounts for 20% of global corn exports. they are the major supplier of natural gas to europe. the broad concern is if russia is hit and will be hit with very, very tough economic sanctions that russia responds by playing the commodity export card >> and how do you handy cap that possibility? >> i mean market participants have been saying russia wouldn'tidary risk its reputation as a stable supplier, but given they've plunged europe into the greatest security crisis since the second world war i don't think we should be

sanguine they won't flip to major economic pain on western consumers in the hope of changing calculations about the willingness of western leaders to defend ukraine. >> when you look at the price of oil this morning, does that make sense to you, do you think it should be more expensive, less expensive? >> i mean that makes sense given that we have the commencement of an actual full-scale invasion. i think what the market will be looking for now is actual signs of physical disruption i mean, one thing that is concerning is that when we had supply instructions before we've been able to call on producers to spare capacity to help fill the gap, to help tame prices right now we have very thin spare capacity shock absorbers in the oil market. saudi arabia have indicated they're not at the moment willing to put additional barrels on this market and so the white house does not have that many cards to play

we expect them to go for an spr release, one that will be coordinated with iniea but, again, typically washington with make a call and ask for more barrels right now it's not clear that call would be answered >> you just talked about the biden administration and tapping the strategic petroleum reserve. you think that we don't have enough is that what you're trying to say? >> i mean, the issue is i think they can do a large coordinated release, but the problem is given the magnitude of russia's oil export, if russia were to start curtailing supply, you know, that is a very, very serious hole that would have to be filled. again, no indications yet russia is going to restrict exports, but if they were going to go down that path, it is hard to make up for a russian pull back in commodity exports again, i've said this before they're not a gas station. they're a commodity super store,

and they were the ability to really push up inflationary pressure >> how strong is that opec plus, opec plus russia connection, and how much pressure does this situation kind of put to that? are the saudis -- so far they've been willing to say we're not willing to pump more at this moment, but is there a pressure point for them where they say forget about it, we're not going to stick with this because the international pressure is just too much >> becky, that is a great question i mean, saudi arabia does like its reputation as a central banker of oil. i do think that if the united states were to basically strike some type of agreement with saudi arabia where we convince them we are a stable partner that will secure their security interests in the region, that the saudis might be willing to be more helpful. they have said we're putting barrels on the market, doing it under this opec arrangement, but if we want more barrels than them i think it's going to have

to be a serious ask. >> secondarily, if we're looking for other places that the administration could put pressure to try and see some additional capacity i guess they could turn to the majors if you're looking at chevron, exon mobil. >> the only country that really sits on spare capacity is saudi arabia, that is why in the past they've had conflicts that have impacted oil prices. the first call is always saudi arabia we can tap the spr, but if we need a country that can consistently raise production to meet a supply gap if one emerges that is the kingdom of saudi arabia >> breaking it down for us this morning, we always appreciate your perspective so smart in the midst of news rolling at us literally this

moment thank you. >> thank you for having me let's get to a global market sell-off after news russia has launched an attack on ukraine. we want to show you the moskow exchange right now it's russia's largest exchange for trading equities, bonds, metals and commodities it's getting hit hard as you can see. european markets also taking it really pretty bad today in terms of bigger losses and we're seeing up to 5% losses you can see in germany and also in italy in the u.s. the futures at this moment are stable but sharply lower, down 800 on the dow our continuing coverage of russia's attack on ukraine and the global market impact will continue after a short break 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?

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blackrock silver is bringing new life to a historic silver district,nts, the second largest in theeed, silver state of nevada. with multiple recent high grade discoveries, blackrock is well underway on the largest silver exploration program in america. blackrock silver. welcome back to squawk i want to get right now to eunice eun in beijing with a response from china. we've been talking about this for several weeks. i said last week, you know, when the olympics are over, watch out. and here we are. >> reporter: yeah, well, china is blaming the u.s. for actually

increasing the tensions, and today it rejected the term invasion the foreign ministry said that the ukraine situation is a result of complex factors. and earlier it said that washington was immoral for playing up war so what we're seeing is that china's really tap dancing around the ukraine issue on the one hand it does want to be seen by russia as supportive since the two have interests aligned against western power. on the other hand, the russian move really breaches what china has said is a key principle of its international relations, and that is noninterference in the affairs of other sovereign states so china wants to appear as though as abiding by those principles and instead state media have been describing it as russia's special military operation. so in doing, though, of course beijing is still siding with

moskow and so other signs of support. the customs authority said it's expanding its import of russian wheat. and this is just the latest -- the latest indication that beijing really wants to help russia kind of work its way through these western sanctions because it comes after what we were talking about before president xi and president putin meeting and really having this kind of love fest at the start of the winter olympics where the two had announced several gas and energy deals guys >> eunice, what is your sense how carefully officials in beijing are watching this situation, the reaction to it in insofar as the u.s. and its allies have not necessarily been able to take meaningful steps and looking at that as a precursor to the conversation we've been having now in the

last year and half how you think china might ultimately deal with or resolve in the way they feel to deal with fiwan . >> reporter: we know they're watching it closely just based on the regular announcements either state media or official statements coming out from the government just in the past hour the state media said the foreign minister of china had a conversation with a russian foreign minister, again, reiterating their points, mainly saying they understand russia's legitimate concerns however, in terms of the taiwan question there are obvious similarities in that these are -- they're all about sovereignty claims, but there are some differences as well i mean, russia as we know sees ukraine as very important to its security the chinese see taiwan as critical to their future but at the same time president xi is not amassing troops.

and also one very important point is this a political year for president xi and at the end of the year there's going to be a leadership reshuffle, and so stability is paramount right now. and that is probably going toply into the whole factor as to whether or not china would even attempt to make a move on taiwan >> eunice eun in beijing, appreciate it. thank you. meantime u.s. stock futures plunging on news of russia's invasion of ukraine. let's get over to dom chu. >> absolutely, becky, and to the point we've been making now for the better part of an hour and 40 minutes and even before that, the market reverberations are widespread there's no real part of the market even if it's remotely associated with this particular issue that is unaffected so to that point we've shown you grains, oil, things like tat let's take a look at some of the other individual stocks.

first of all, the tech trade the nasdaq will be among the major three indices in the u.s., the one implied to take the hardest hit at the opening bell. the computer chip stocks have held up relatively speaking versus other parts of the tech market in a way that has perhaps called attention to some of the moves we watched there in the early going stocks like intel down about 1.5%, so perhaps maybe even outperforming a bit, but then qualcomm, advanced micro, other chip makers as well all taking a hit in this trade. so it's not isolated to just stuff happening central to ukraine and russia chip stocks in america, valuation concerns still building there fed interest hikes may be down the line so we're watching chip stocks. also travel and leisure, maybe there's a case to be made there could be a certain slow down in certain parts of the world with regard to movements and what not that are at least of the elective version hilton worldwide is down 4%

right now. wynn resorts and mgm, some of the casino operators down about 5.5% to 6% some of those travel and leisure stocks that have been doing so well over the course of the last year are taking a hit, and we have topoint out the fact there is green on the screen yes, there is for the big oil companies out there. with rising oil prices names like chevron, exxon mobil. total, bp among the companies on the major side that may be taking a hit because of that still oil prices certainly on the up side. back over to you guys. >> one point on that, i think bp is the largest foreign investor in russia. it's got almost a 20% stake in the oil company there.

that explains why it's going against what you see in the other major oil companies as well >> absolutely, becky let's take a look at this board of commodities, if you will oil, corn, wheat all up sharply this morning oil nearing $100 a barrel. joining us now a senior managing director and cnbc contributor. and we know what was happening even before any of this. now, there were troops being amassed but there are other factors pushed commodities to multi-year highs already so we're just adding this on top of that. typically in the past with things like pressed metals or even oil high prices usually ingender more production, just that's the self-correcting mechanism we see all the time. could that happen this time? we're okay with wheats, oats, corn, we can handle that it's the stuff we've got to

bring in i'm worried about >> well, as it relates to energy specifically that's incumbent upon president biden and his administration to reverse some of the policies that have been put in place that d disincentivizes increasing production for the consumer i think there's been a lot of conversation this morning and rightfully so on the rising costs for everything from what's going to be chocolate to cookies to bread to even shampoo. you've got ukraine and russia as significant exporters of wheat and corn, 20% and 25% respectively both of those commodities this morning are up russia and ukraine export 80% of sun flower oil, palm oil used obviously in shampoo it's already a tight market and

labor shortages in malaysia. collectively this is exacerbating an inflationary cost to the consumer it creates an incredible challenge for the federal reserve. it's all correlated, and certainly the federal reserve is not going to embark on a 50 basis point hike here in march it's going to be 25 base points, but it's not going to remove the pers persistent volatility and continuation of these pressures consumers and ultimately corporations are going to feel in 2022. >> every time we get an inflation data point it's going to be scary, joe, but how much of this is permanent we don't know obviously what's going to happen with russia, but it doesn't seem like the same type of deeply ingrained inflationary forces from the '70s, wage-price spirals, things like that. it doesn't seem like that yet. and i don't think the bond market -- could the bond market be this wrong about what the

real fears are is it that manipulated by central bankers it's not giving us more of a warning sign about how permanent inflation is really going to be >> no. i think that the yield curve, the two to ten trading at 38 basis points is tell you the growth is going to have to slow in some capacity because there is going to be this persistent volatility, and i keep using that word because that's something that investors have grown uncomfortable with and really haven't experienced the last couple of years but there's going to be this persistent inflation as well joe, if you think about it in the last ten years anytime there's been some form of dislocation in the market or steep correction, you've got a very fast v-shaped recovery for all assets and all equities. and this time in 2022 it's going to look different. look, there are things you could buy today. without question there is. you've got apple which is going to open down below 155 alphabet going to open below

2,500. and microsoft is going to open somewhere around 270 these are megacap equities those are the names you can look at buying today. on the inflationary side how are you going to protect yourself? and don't lose hold of your energy names, but this is different market this really is, joe, your parents or your grandparents market again go to the staples. look at tyson foods, a coke, a pepsi, kellogg, kraft heinz. that's going to allow you to ride out a persistent challenged environment because of inflation in 2022. >> man, if you're talking about my grandparents you're talking going back for that. trying to figure out what was going on back then electricity i think was starting thanks, joe. man, tough to make any jokes on

days like this when we return, though, we'll have much more coverage on russia emphasis invasion of ukrain and the market sell-off that's coming as a result. in fact, you want to take a look right now at crypto. bitcoin down by about 6%, but it is the best performing of those crypto currencies. continue to watch this and get you caught up-to-date on everything else that's moving this morning as well stay tuned "squawk box" will be right back.

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to the broader markets now futures indicating steep selling this morning russia's invasion of ukraine is dampening investor sentiment our next guest has some data about what could happen to risk assets now that the situation has worsened joining us now is the chief global strategist and head of asset allocation at deutsche bank we've been talking a lot about previous events like this that are short-lived in terms of market impact. does this have the characteristics in your view -- and you're a stock guy, not necessarily a strategist, a geopolitical strategist, but from what you can surmise right

now, could this be more troubling, more damaging than previous things like two iraq wars, other geopolitical events that weren't that long lasting at least in terms of a market impact >> good morning, joe yeah, so, i would agree that basically, you know, what we got yesterday or last night is really sort of worst than sort of the baseline expectation that we had or the markets had. so i would argue that we are talking basically about another 5% to 6% down, which would basically put us close to sort of 20% or bear market territory, and i think the market will basically test that. but you're absolutely right. i mean the history is basically around geopolitical risks is of really short-lived, sharp sell-offs with an average

sell-off of about 6% three weeks from the bottom, three weaks to recover prior levels though i would emphasize sort of uncertainty basically remains, so that's not something you want to trade on today i would say, but in the point of view of thinking about and this is really ongoing for pull back in sort of 5, 5 1/2 months we've had. if you look at equity investor positioning it's actually very low already, and that means a lot has already basically been taken off, so that provides fuel basically on the other side so we're talking about on the show

discussing the vixx is so high as it comes off it wants basically the steady stream of negative catalysts, you're going to see basically some of that the market has fought again cashed in. and that's going to fuel back the up side. >> previously, the uncertainty surrounding some of these past events could account for the type of break we saw in the markets. i'm wondering whether this time we need to actually factor in what happens with the global economy, whether it's inflation or stagflation if this were to last long enough in terms of destabilizing major parts of the world, it could be more than just people knee jerk selling because of uncertainty it could cause some underlying, you know, not positive economic

developments globally. >> absolutely. so it's unambiguous it's a negative for growth in the u.s. and different regions basically going to be impacted quite differently i would say. i would say the u.s., though, it's not obvious to me we will basically end up being a recession as a result. you know, i would argue that basically there's sort of a set of factors sort of coming together here. there is the concern about the extended cycle, the high valuation in cap growth and tech stocks even though they should be the least impacted you're basically seeing the sell-off. and they're down by a lot more

so that sort of force remains. as far as the fed is concerned the point to make is hiking rates basically tightens financial divisions, and geopolitical risks has, you know, done that to a considerable extent. so in terms of the stagplaflati and the risk, we basically have pressure on the commodity space or supply shortages are definitely going to be worse but i expect the fed to sort of look through some of that. >> all right, thank you, for that analysis. i told you i heard from jud, not naomi on this. we got to beg the saudis to help us out jud said and i'm going to quote

him, i'm sure the biden administration can threaten windmills that the less politically correct policies have in large part empowered russian leverage by trying to dry up the capital needed to expand drilling in the u.s >> the problem is expanding drilling in the u.s. even if you reverse those policies, it's not an overnight change. >> we don't even mention we used to do it i mean, there's -- at least on this network we don't necessarily go into those. >> certainly we have it's a situation where we have incentivized people not to do it the big majors have gotten the message and as a result they said they're not going to be swayed by higher oil prices. even if it is it's not something you can make a switch. if you put pressure on saudi arabia right now they could. >> we will let jud come on for that >> i don't know why we decided to politicize this >> because i read judd greg's

thing. we're sitting here talking about begging saudi arabia we've hampered our own production here and that's leveraged russia's power in being able to do this. that's why, andrew and that can be brought up even if it's not a "the new york times" perspective >> having said that if we were being honest actors we'd also say the biden administration for the past several months now have been saying this was going to happen, and lots of people on the other side were saying, no, no, no, this is some kind of strange distraction or something else you've heard that before and in fact they were right about where we are you could talk about what's happened over the last four years in terms of empowering putin. so i think that there's -- there's lots -- >> in four years putin didn't do anything during the obama administration he did crimea, and now he's

doing this during -- why didn't he do anything for four years? and we weren't -- we weren't undercutting nato. we are asking them to pay their fair share i mean, the weakness that has manifested is what caused this, not the previous four years have prevented it >> look, and in fairinize to that analysis you could make the argument under president trump putin didn't want to do anything in part because he was too worried that trump would do something dare i say crazy or something that would make it impossible for him maybe to that perspective you could argue that was a good thing. >> we used to lead the world in oil production we should still. this is not good >> the secretary of defense at this point is now looking at this as a much more important national security issue, that you have to have an energy policy that recognizes energy independence is energy security is national security, too. and that's probably something we'll hear much more about >> maybe near term geopolitical

events should have been at least on an equal level to the climate emergency. there are other emergencies that maybe are more near-term that's another issue >> meantime, it is just about 8:00 a.m. we're coming up on 8:00 a.m. this morning on the east coast, and you are watching some special coverage of the russian invasion of ukraine and the global market sell-off this morning. i'm andrew ross sorkin along with becky quick and joe kernen. i want to show you where futures stand. you can see the red on the screen the dow off about 763 points, the nasdaq off about 418 points, and the s&p 500 off about 102 points it does not appear that crypto is a safe haven, and we've been watching the ten-year note and we've been watching oil move higher, much higher this morning. becky? >> the only sector that was higher was the energy sector that is playing out once again today. one of the sectors this morning

are the travel stocks, that's along with the entire market this uzcoming just as the travel sector was showing some sign of recovery from omicron. joining us now is bookings holdings ceo booking reporting strong earnings glen even before this news of the ininvasion of ukraine we did see some shares under pressure i think it was some of the commentary you were given in terms of expectation for this year concern for investors it's just the idea omicron could pop up at different points again throughout 2022 and bookings now you've got this additional pressure from what's happening in ukraine and potential for war in europe. how do you look at all this and plan out as a business what to do >> thank you for having me and my first thought, this morning for us is what's going on in ukraine. we have the employees there in

kyiv and what we can do to take care of them obviously we're concerned about our customers in ukraine and of course our partners, our supply partners so that's first of mind right now for me is dealing with that situation. of course we also have to think about the future and what we have to do in terms of travel. and i have to say this, this is tragic what's going on there, but i don't think it's going to impact a great deal of travel. people who want to travel in the u.s. will travel, and they will rightfully terrible what's going on there, but they're still going to do their summer holidays i still think in western europe they're going to do that we are looking at numbers for the summer that are better than they were at this time in 2019, so there's a lot of pent-up demand coming through as people think it's safer to travel, they're going to travel. >> glenn, i realize this is very early on in all this, but when

do you think you might see weakness, and what would the impact be? because i do believe booking has more exposure towards international. what is it 80% of your pookings come in terms of international cross border trips >> it's actually about 50% historically obviously it's much further down than in the past because of the unfortunate issue of this pandemic and closure of international travel one of the great things about our product is it's so flexible, so much accommodations is totally flexible so what we'll have is people they bought these flexible accommodations they can cancel at any time so they're going to wait i believe they don't want to give up what they have right now particularly in a very high inflation period. atory concerned if they have to rebook a few months later it may be more expensive. i don't think we're going to see a big move because of uncertainty for some time. >> what have you seen in terms of inflation when it comes to booking hotel rooms and other

aspects of the trip? >> those hotel rates, they're up and i think that is something that is we're all concerned about. and then go onto air fares and discussion recently about oil of course jet fuel is completely related to oil so clearly people are recognizing that, and they are thinking i'm going to book early right now beforeprices go up >> are people spending more to insure their trips or does the flexibility buy them enough room they figure they can change the dates if something goes wrong >> absolutely, if you're buying a hotel that has complete flexibility no reason to buy any type of trip insurance that being said we have rolled out a new product which is the trip insurance for our hotel for times when you can't get that flexible type of rate.

we obviously want to make sure people have the flexibility because we know things change very rapidly i had a conversation with you all in the fall, and omicron did not exist at the time, and things were looking pretty good. all of a sudden omicron comes in and people start canceling >> glenn, what is the situation with employees in ukraine and kyiv, and what's the situation with travelers right now what are you able to do to kind of help them out >> well, knowing things were looking somewhat concerning, we started enabling our employees in kyiv to be able to relocate if they wanted to. and some of them took us up on that early, so we were able to move those people to safer places outside of ukraine if they wanted to go. for customers we're always available for them if they want to change their bookings, need new bookings and always trying to communicate with them what the situation is for our partners and also for us working with them obviously there were a lot of cancellations that will come through if anybody's planning to go to ukraine, and we'll deal

with those, too. >> we've talked this morning how this was a tail risk, the idea this invasion would take place a lot of people weren't anticipating it. however, the biden administration has been warning americans for some time not to go to ukraine, to leave if they're there. have you seen that play out with the bookings taken place over the last month >> i haven't looked at the data very closely i certainly hope people -- those warnings came out very cleary and people took advantage and we certainly were tul e telling our employees about the alternatives they had this is not something that's come out of nowhere. people have been told this could happen >> i want to thank you for your time this morning. appreciate your candor, and good to see you >> thank you >> okay. for more on russia's invasion in ukraine, joining us right is hoover institution senior fellow, former national security advisor and general h.r.

mcmaster i'll start with a basic question, your reaction to the news as you woke up. >> it's not a surprise obviously. and you were discussing the warnings have been there for a long time, and it fits into the broader context of what russia under putin has been doing at least since 2007, and you could probably go back to 2000 so i think what's important to know is we're in this competition, in this fight for the long haul with russia. just consider this is an invasion that began in 2014. this is a country under putin who has enabled several episodes of mass homicide in the syrian civil war that has attempted coups across europe, that is determined to -- determined to restore russia to national greatness by dragging everybody else down. so i think as you've been discussing, i don't think we factored in the jestrategic risk from an economic perspective and add onto this now putin's

visit to china just before this during which i'm sure xi jinping green lighted this, and the a, authoritarian regimes i think are determined to dominate and this calls for a concerted response across the free world >> let's talk about that response and what kind of leverage you believe the u.s. and its allies have if we do it all? >> well, you know better than i do we have tremendous financial leverage, and we're talking about access to a swift banking system we're talking about sanctions on russia's national bank i think it's time to do it all in terms of imposing costs on putin far beyond those he factors in at the outset of his decision making. as i mentioned, it really fits a pattern, and this is going to continue what's next? all of ukraine how about mauldova

they've threatened the baltic states with massive exercises on their borders as well. it's encouraging serbian separatist movement in the balkans to reunite conflict there and reunite serbian nationalist sentiment. i think it's important for us to respond together i think so far so good, right, in terms of unity across the free world we've had some bumps in the road there especially those associated with russia's ability to foster dependence on russian oil and gas. right, germany buys 50% of its natural gas and 41% of its oil from russia. so i think it's time for us to really take actions immediately. but also we have to shore up our supply chains. we have to recognize supply chains optimized for efficiency have neglected the resilience necessary to withstand some of these geostrategic risks

>> what do you think is the immediate answer if there is one? >> well, it's obviously we're already seeing it work which is trying to surge capacity, and we need others to help us do that our friends who we helped defend in the middle east have a role in that. it takes even longer to respond if we don't start. so i think it's time to invest in infrastructure. what i can't imagine is why we would make it harder, for example, to build energy infrastructure in our own country at this very moment. and i'm talking about sort of the regulatory options associated with pipelines and so forth. >> if you're not going to face that you havesome vested interest in not facing it. but let me ask you about europe. would you say for lack of a better term green or eco activism had something to do with europe with the dire position that they're in right now? and if it happened there, you'd have to say at least to some extent that's the same thing that happened in this country,

maybe not to the same extent, and you can blame those policies for this >> absolutely. look at the decisions made and this is canceling nuclear power, and we're about to do that in california, too. the greatest reduction in man made carbon emissions in the energy sector was associated with the availability of cheap natural gas in the united states if you look at russia's disinformation campaign, it extends into the environmental movement if you look at the anti-fracking movement, for example, and anti-shale movement in europe, much of that movement was funded surreptitiously by russian intelligence they want to maintain coercive power over europe's economy. france has taken some bolds i

think to break away from that. they were sensible in doubling down on nuclear power. if you don't have natural gas as a bridge and don't have nuclear power really you're only pursuing nonsolutions, and we have to break away and do what makes sense for ourselves and the world in connection with carbon emissions and global warming. >> play that out in the context of the linked china and what may happen in the future and what we can and can't do in the united states to get production and semisucters in place to make up what could be a shortfall in the future >> this is another area of vulnerability, and i would add we talked about sort of natural gas and nuclear power, but it's also other supply chains involving energy sources including rare earth's manufacturing and separation and

refinement, battery manufacturing, magnet manufacturing. and this all relates to china. i think what we're at risk of doing not only in semiconductors and microelectronics but trading independence in the middle east. remember that relationship in the '70s with a new dependence on china we're in a race and we're behind it's time to sprint. the chips act as mired in congress, hey, let's get something done especially i think we need to talk to our representatives in congress and say stop compromising what we need to do for our own security for partisan political gain and get the chips act down so i think it's extremely important that we also recognize we can't look at the threat from russia in isolation anymore. if you look at the 5,000-word statement that putin and xi jinping issued at the outset of the olympics, thif that's not an alliance i don't know what is.

and i think china has green lighted russia here and offered i'm sure to buffer economic ramifications and financial ramifications on russia by buying more russian oil and gas, for example. so we have to recognize we have two authoritarian regimes who are hostile to us who are are determined to create the areas of privacy across euarasian land mass and i would say an even more proximate threat to security in the south china sea as we see china repainting their naval vesselwise coast guard colors, and they're about to claim they own the ocean, and a part of the ocean over which one part of the world's surface trade flows. >> h.r., mcmaster, we appreciate your perspective this morning

and hope to talk to you again soon coming up, much more coverage on russia's invasion of ukraine. futures right now kind of stuck at 800 on the dow. s&p down another 808 already down 14 at least now some tech stocks are being hard hit. they're the biggest decliners in the nasdaq so far. ebay had some results it posted as well. tesla now a seven handle threatening to have a sixth handle ks to voya, i'm confident about my future. voya provides guidance for the right investments. they make me feel like i've got it all under control. voya. be confident to and through retirement. ♪ get a head start in investing with the new schwab starter kit™. new investors can open an account and get $50 to split across the top five stocks in the s&p 500®.

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recapping our top story, russia invading ukraine and global markets falling hard. let's get over to dom chu. he's been looking at some of the biggest premarket movers >> we're going to take the next layer of the onion we talked a lot about different groups feeling the reverberations from this we're starting with the positivity if you want to call it that in the market right now and that is certain defense contractors. maybe no surprise those companies geared towards making things, geared towards aero space and defense, some of the biggest market cap weighted companies within the overall industry for aerospace they're

catching up so far meanwhile you've got shares down so we'll keep an eye on those particular stocks as well. speaking of aerospace and defense, if you take a look at the overall picture for airlines, and many of those will center on whether or not there's demand for tickets, for travel, whether or not certain plane manufacturers like boeing will see that, and by the way boeing is down in premarket right now united airlines and american down roughly 5% to 6%. these are some of the american carriers more geared towards international travel markets so we'll see if delta, united trade play off there, but also more domestically focused ones say southwest airlines down. and jet pludown 4.5% so airlines a key focus there as, and then arguably the most important stocks to the market narrative, they are apple,

microsoft, alphabet, the parent company of google, amazon and tesla. you can see all of those stocks down pretty markedly so in the premarket trade. we all know these five stocks make up a bulk of the s&p 500 and the bull cot of the nasdaq composite. they tend to be either a big tail wind. tesla, by the way, down about 8% in the trade right now could be a big drag on the market >> tail wind if you're in. joining us for that is the chief investment officer at sand hill global advisers and a cnbc contributor. also katie stockton the fair leaf strategies founder and partner. waking up this morning to news of invasion, what do you tell worried investors?

>> i think this isn't terribly surprising we've been knowing it was a likely scenario. but i will say we spent time looking at all the other geopolitical events since 1940, and look at the reaction of the s&p 500 over time, and within one month the s&p 500 has been positive 66% of the time and looking out one year it's positive more than 80% of the time so i think even though these events are troubling they typically have presented a buying opportunity unless the impact is so great that it really does have a meaningful impact on our economy and a meaningful impact on corporate earnings and so far we're not seeing that we think it's an unlikely scenario, so we would take this opportunity to add high quality names within your allocation and stay diversified >> let's just ask that las question is this different this time? i guess part of that if you wanted to point to that to make

that case you can say look what's happening to commodity prices if you look at energy, the grains, hard metals prices all of them up significantly, and we've seen inflation being such high levels across the globe at this point that adds to the picture and puts additional pressure on central banks to go ahead and fight that what do you think happens in that scenario? and if they did raise rates would it bring on recession? >> i think rates are still going to be up there, so we have a ways to go if we look at the health of consumer, you know, the consumer out lay to debt payments are at 40-year lows wage growth is high. despite the consumer sentiment there are several readings suggesting there is actual real wage growth happening so in excess of inflation right now for many people. so i think the consumer still has some wiggle room that being said i think if there was a massive dislocation within the energy market that there would likely need to be some

government intervention to help support, you know, a continued drilling activity in our own country, which your previous guest alluded to but there have been huge disincentives to go that way certainly oil prices make it much more financially attractive overall we think it should be manageable at this point, but fair to say that only time will really tell. >> hey, let's talk about what we've seen with major averages all three of the major averages touched below their intraday lows from january 24th yesterday, but you actually had both the nasdaq and dow closing below those levels and you see additional pressure to the tune of several percentage points >> it's essentially a short term break down on those january lows what we often see is when you get this big downdraft, it really shakes out market sentiment. sentiment was already getting

pretty bearish and on a day like today that really can shakeout the market, so we wouldn't be buying today necessarily, but it does suggest there's an increased chance that these break downs we'll likely see are likely shake outs or false break downs, and it ends up being a pretty good buying opportunity we've been seeing that and a buying opportunity some time in march. it's a very seasonal phenomenon we get that buying opportunity, and yet today might be an opportunity to kind of trigger enough of that sort of shakeout in market sentiment to get us to the place where we have a low in place. i usually recommend we enforce some kind of support discovery rather than buying into the gap down what we tend to see if you see the market or the stocks in question get right back up into their gap within the next week or so, that tends to be a positive development >> so not a buying opportunity today, but watch closely, we could get near those levels? >> that's right. and for the s&p 500, the break down targets only about 4,000.

we're likely to see something close to that today, so the targeted levels are not that dramatically lower from current levels, and again these are short-term break downs, not long-term break downs. and the sentiment could actually become more positive from a contrarian perspective >> katie, brenda, thank you both coming up, more on the global market fall out of russia's attack on ukraine hedge fund manager kyle bass will join us he'll weigh in on how china is watching i think they might be a little more than just watching -- watching the situation. kyle should have interesting things to say. stocks leading dow futures lower this morning stay tuned you're watching "squawk box" on cnbc i am here because they revolutionized immunotherapy.

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still to come this morning we do have breaking economic data we'll be getting a revised look at second quarter gdp. that is just moments uhaway plus the always outspoken kyle bass will join us on the reaction to russia's invasion of ukraine and what the chinese are thinking as they watch this play out, too continuing to watch the futures this morning at the session lows right now dow futures off by about 2.5%. s&p futures down about 2.7%. the nasdaq down by almost 3.4% d iss bcawbo" g "squk x, anth icn

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welcome back to "squawk box. rick santelli here live at cme hq with breaking news. our latest read, of course, on initial and continuing claims for the weekending february 19th 219,000 initial claims

that's down 16,000 and less than 235,000 expected on continuing claims, wow, a definite drop. 1,476,000. this is new post-covid low, and it is definitely well below expectation. now, gdp this is our second look at fourth quarter 7% was the expectations. 7% was what we got that's versus the original look at 6.9 and if we look at the consumption, personal consumption, it drifted a bit from 3.3 to 3.1, and that's 0.4 below expectations and if we look at the price index, it's a big jump 7.1% on the pricing index. 7.1% to find a higher number you have to go back to the fall of 1981 or the third quarter of '81. on the personal consumption expenditure core quarter over

quarter it moves to 5% that's versus 5.9. the high-water mark was the second quarter are, and that took you back to 1983 the third quarter when it was 6.2. on the personal consumption, joe, we're definitely a little hotter than expected but well-off the pace unlike the pricing index which is zooming, and of course everybody is focusing on the horrific events currently taking place in ukraine and how of course it's affecting markets. one thing i'd like to point out on the treasury side the range on the two year note down 160, and currently at 150 and on the tens it's been 199 down to 184, currently at 186. and throughout the entire move right now tens are down close to 13 basis points. twos a little down ten basis points the curve keeps flattening, and

when it keeps flattening that means one of the overriding themes that comes through the geopolitics is the fed a little less than four weeks away or three weeks away >> you follow them all we know what's happening beforehand there is going -- in your view do you think that the world will refocus energy policies? and by that i mean europe is handcuffed right now in their response given their policies. here less so in the united states domestically, but we're going to feel $100 oil we're going to see that at the pump, and it's going to hurt gas prices are going t

germany, exchancellor sitting on the board. we can talk about the pipelines, one is operational, one we put the halt on at this point. but energy is all around these issues and what is putin's next move going to be? you think he's going to keep his gas flowing? i don't know and can we do airlifts as we saw an op-ed today in "the wall street journal," yeah it's kind of a good idea. i heard your discussion with becky. i remember when it was building lng ports all these issues, we should have started already. it's too late. it won't make a difference we need to start there's never a good time.

now is a kntime. just like writing a novel the first page is the hardest, but energy policy is going to be refocused because the world needs ene the people woe don't necessarily want to be doing business with. >> rick, how much of build back better was climate initiatives >> that's why it didn't pass that's why it didn't pass. because i think that we're finally starting to get some clarity. we have high moral ground in the united states, and that's care of the planet joe, it was our generation that created earth day. i get it we need to take care of the planet, but on the other hand we need to do it in an intelligent way. we can't stop energy before the replacement's ready. putin is monitoring this china is monitoring this it's not a good thing. >> rick, i actually agree with you that we need to figure out a better energy policy in the u.s. but the truth in terms of what's actually happened on the ground

is counts went down in 2020 under president trump. they didn't go up. they've actually gone up since then isn't this a function of the price of oil when oil was at $40 nobody wanted to pump it. that's the truth now it's up where it is. >> you're right, andrew. you're absolutely right. when fracking and everything was going wild the price got to a point where it didn't make sense. the market would readjust. the problem is that the government sticks their nose into it. if we would have left market forces alone commodity price like soybeans -- with soybeans this high what do you think farmers are going to plant next year lots of soybeans i would imagine. market forces work government putting nose into market forces never has worked >> we should also point out we're talking about rate count going down at a time when oil prices went negative

you had the pandemic, you literally had oil prices fall negative, but it's hard to say it was the policies of one administration or another that necessarily led to all these things >> it's easy to say. it had nothing to do with trump's energy policies. >> that's my point i would say there are some policies today hindering things. in fact, we've had some of the ceos of the major indices coming on and telling us that >> listen, i have nothing against joe and i think he's doing a pretty good job trying to keep nato and our allies together here. that's not the issue the issue is that we need to turn on the lights we need to make sure that evil forces around the globe understand that europe needs to get their energy house in order. and if that takes the united states and its allies to do as much as they can to ship as much energy there as they can even if we're behind the curve, we can rise to the occasion >> all right, rick we're going to -- we're going to

end it there we're going to continue all these interesting points and discussions, and it could get even more interesting. breakingnews, russia invading ukraine after weeks of speculation. doesn't just have implications for europe russia and china are much closer much closer lately remember just a few weeks ago putin attended the opening ceremony of the winter olympics in beijing when americans had staged a diplomatic boycott. joining us now to talk about what the ukrainian invasion means for the relationship between russia and china is kyle bass, founder and cio at hayman capital, and how much has it changed? it's been pointed out some of these troops that are amassed on the ukrainian border used to be on the border with china, but putin apparently doesn't feel he needs to do that anymore are they really aligned against us >> joe, i think it's important go back and read that february 4th joint press announcement

between president xi and president putin. and in it they announce a new strategic partnership. china's tacitly endorsed putin's move into ukraine, and putin tacitly endorsed china's one china policy and condemned any kind of a separatist talking about taiwan so i think that we're not dealing with a regional crisis anymore in the long run, joe china is going to watch very carefully what the u.s., ukraine, europe does on the sanctions front. the initial sanctions we announced were -- were extremely disappointing. if we're not willing to sanction the banks in russia, putin himself, lavrov and others and pull russia off the global swift system basically eliminating their ability to move dollars around the world, then that

tells me that china has the green light to go take taiwan. >> the taiwan question, more likely, less likely? and china needs a global economy or can it wait can it wait and put off some of its aspirations in terms of its people or are they ready to go? they're ready to do it now since the getting is good maybe taiwan >> i think it's important to note i've had a lot of conversations over the last few months with my colleagues in asset management and many of the arguments -- almost all the arguments begin with putin won't invade ukraine because it doesn't make economic sense, the sanctions will be crippling. i think market participants they need to stop associating their investment needs with the

economic decisions of these -- of these despotic leaders. these guys are not using economics to make their decisions here these are -- these are national security decisions and are decisions where the history books are going to lead them and i think remember when the wall came down in russia it wasn't because ideologically the u.s. had a better model and that our model of morality and democracy was something that looked good to russia. it was because we and our allies pumped so much crude, we took it back down to $10, and it broke the russian economy. that's how the wall fell now we have $100 crude you guys have spent a lot of time this morning talking about the policies of the past administrations and the current administration you can't change the feedstock for energy in the flip of a switch, and that's what we've been pursuing. and i think we better putting

more money there at the same time dealing with the climate crisis and maybe bringing more china is going to watch what sanctions we impose on the russians and unlike russia china doesn't grow its own food. china doesn't have its own energy russia exports 8 million barrel of crude china would be desperately debilitated if we were to take them off the swift system, so we need to stop thinking in pure economic terms and start thinking about national security and i hope the people in the administration can do it >> so you made some points there. so drill, baby, drill ushers in its own bear market, and then you stop drilling. and then -- and the opposite is true as well so you cut off the incentives to drill. prices go up, and then everyone comes flooding back in so i can see how it's worked the

way it works it almost reminds me of capitalism you create a woke working class -- a woke elite class that doesn't appreciate capitalism anymore. how bad is this going to get, kyle, in your view and i'm not asking you to read putin's mind but you figure ukraine is going to be part of russia is that the end game here and was it go beyond that? >> i think it's a given we've already told the world we will not send nato or the troops in to defend ukraine even though we were amongst the leaders getting ukraine to denuclearize after the wall fell. remember ukraine had a third of russia's nukes so we got them to denuclearize and we along with the u.k. signed an agreement that said we'll protect your territorial integrity from now we blew that in 2014 in crimea we said this won't stand here's putin again taking the

rest of the ukrainians so we've really had some huge foreign policy blunders, and i think it's aforegone conclusion that russia ends up with ukraine. it's how much do they pay? how deep do these sanctions go and truthfully, joe, we have an economic nuclear button, and it's to remove people from the global dollar system we have to be willing to press that and socialize that concept to our friends in china -- and of course i'm joking when i say friends. i think we need to start talking about making noneconomic very positive national security decisions. >> well, that's going to be painful. and we're going to be doing it alone. i mean, how much can europe align with us on this if they're freezing >> yeah, i don't know. the tea leaves are out there germany is turning off its nukes saying they're not green, and now you see all of europe who has been here to signaling all along saying we're going to turn

off nuclear power. we are going to be green and now europe is spooling up coal production and firing up coal fired power plant and when we were sending lethal aid to the ukrainians for their defense, germany wouldn't even open their airspace to the flyovers so, you know, we talk about the european union, but there is no union, right there is every country looking after itself right now there's no unified fighting force in europe. there's a german force, an italian force. and now the europeans are going to act i think -- i hope they can come together. we'll see -- we'll see how cold it gets in germany before that happens. >> kyle, will you weigh in on the debate we've been having over the last hour, not to play a blame game here but in terms of whether this is a policy error, in terms of where energy sits, in terms of the larger

national security issue or whether this is a function of the fact as i was arguing earlier that, look, at $40 a barrel, a lot of folks didn't want to drill, obviously and here we are at much higher prices now and also, by the way, there's been a policy issue beyond even energy about how to deal with russia on the populous side of what might be described as the gop. you can look at josh hawley and others, tucker carlson what to do and how hawkish to be about it >> we have tucker carlson still defending putin last night i actually thought -- i couldn't believe i was living in the united states watching this. but, look, i had the opportunity to meet with one of our ex-presidents shortly after he left the presidency, and one thing that i'll never forget that he told me was he said, you know, we're starting to think russia's our friend and putin's our friend, and he looked me in the eyes and said putin is not our friend, and he's a

stone-cold killer. so imagine a u.s. president saying that, a former u.s. president saying that. when we get into energy policy, andrew, i think it's important to look at the esg revolution. as you know i started a new firm that focuses on conservation and environmental policy so i'm very pro-environmental policy and focused on climate change however, our policies in the markets, the esg pundits in the markets began to really hammer corporate boards and management teams to -- to stop investing in hydrocarbons, and public money started coming out of hydrocarbon investment back in 2015 and now you're seeing even private as oil heads up to 90, $80, even private investments from pension funds, endowments and sovereign welt funds is actually telling energy they can't invest anymore because of the problems with the stigma

that's been attached to energy so, andrew, we have money continuing to come out of emp because of the desire to flip a switchover night for esg investing. so when you think about the structural impediments, we have several years of massive hundreds of billions of dollars of investment in hydrocarbons, because we want so desperately to move to alternative energy. and we're going to realize the same powers that took oil below zero will take the front end of oil literally wherever it wants to go because i think we're going to see, we have demand for hydrocarbons we're going to see prices i think no one ever thought we'd see again. >> kyle, i want to thank you i agree with many of your points including -- including the last one in terms of what's happening. oddly enough it actually has been a free market that's

created this remarkable situation we're in right now we're going to get down to the new york stock exchange where we're going to see our friend jim cramer jim, what are you doing this morning? what are you thinking? >> well, putting some money into work, selling some oils which we were fortunate to add, selling big oil and buying some of the stocks that have big yields. doing this because i think the oil stocks are overreacting. it does seem a bit like 1990 where the oil stocks all went crazy. you had a decline, and i see a lot of stocks being given away today for the reason why people say they've been giving every day which is inflation, inflation, inflation if you have stock that are suddenly accidently high yields, 3% with treasuries, then i

really think you have an opportunity. i do believe this scores the possibility of being somewhat over rapidly the amount of firepower this man is throwing at ukraine makes it so it's impossible for ukraine to not yield >> so you think shis a short-term event we've been talking germany, england, france, united states all on one side it doesn't mean anything there is a very rogue politician rogue and old politician who is trying to reunite soviet union recognizes the 1942 that the germans -- perhaps the worst in

the war. and it's almost trying to avenge that i think that was the tone of the speech this weekend. i think it would be a rapid regime change. and those betting will be war may -- i'm looking at the oil stocks they've been on the spike forever. this, by the way, the oil that doesn't come from russia west will go to china i wonder if they continue to act up and the chinese say we won. stop listen to a lot of people this morning who are pretty negative. i'm starting to think it's a bad call. >> jim, we'll see. we'll see. we'll see you -- >> i mean, look. friday is bad. monday come in and maybe they've won. i mean, ukraine doesn't have a lot of conditions. ♪ >> jim, we'll see you in a couple of minutes. [copy machine printing]

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top story this morning russia's invasion of ukraine we'll go live to d.c. for potential responses from the united states government >> reporter: there are strong bipartisan support in congress for the biden administration to impose the most crippling sanctions possible against russia law makers are promising to do it themselves if, for some reason, the white house does not. we know congress has begun

discussing the possibility of an emergency spending package to deal with the crisis the contours still evolving. the democrats said the white house has already suggested a billion dollars would be needed over the next year just for humanitarian aid there also could be money to provide weapons to ukraine for things like stingers, drones, anti-ship missiles, as well as hardin cybersecurity protections. they're talking about funding to the defense. congress has been debating when and how to move for weeks without a resolution now they are united around the urgency of action. guys, both chambers will be briefed later today. back to you. >> thank you joining us now for more is a brookings institution senior fellow and foreign policy. listening to the lils of ideas coming out of congress now too little too late in terms of trying to think of spending on defense at this point. >> hi, becky

a sad day. at this point, we're going to see, i believe, the united states and the west realize that we have to respond even more severely that we have prematurely anticipated. unfortunately our deterrent wasn't as strong as we might have been. i'm not blaming us for this. it was all vladimir putin. i expect over the next few years, we'll develop the kind of energy plan that would have us lead ourselves off russian oil and gas. how can you do business as usual with a country in the process of gobbling up another sovereign state? so i think we're going to give russia the iran treatment. we don't know it yet in a sense. we'll work ourselves toward the realization over time. vladimir putin will realize he choice military conquest over functional economy perhaps for the rest of his presidency. >> michael, we've been talking over the last several weeks. you were convinced it wouldn't happen pu vladimir putin would see the

logic. it would be too painful to deal with the sanctions what happened? >> yeah. a month ago i are thought he would find a way to back down. the last few weeks, i became concerned he didn't have a way to back down unless there were some kind of a diplomatic process that began that could at least offer the possibility of the differing model for ukraine's future security than being in nato. always you know, i advocated that and thought we should have done more to create that dynamic. that kind of process without giving into putin's demands up front. it would have been the outcome of a protracted effort that putin would have to contribute obviously it didn't happen perhaps it wasn't feasible today is the day to unit against putin. he cares more abouthis militar legacy and restoring this idea of a russian empire.

>> the options for nato, our allies to stick together on this don't seem like they have all that teeth maybe putin has been planning this all along and he correctly identified there wouldn't be enough unity to do things like take them off the swiss banking system there's not even unanimity on the front now. is he playing us knowing that the longer he stretches it out, the more likely there won't be an united front? >> i think that's probably part of it. he apparently made a calculation he cares more about russian honor, pride, and historical role he can have in restoring what he sees as the russian empire he cares more about that than building a functional economy or being a part of the modern international order, as we tend to see and define it the idea russia isn't big enough already territorially and therefore expanhandling to include all possible russian speakers or at least ukraine this would be putin's priority

he's already had a bad economy for a decade his gdp growth has been mediocre for 10 years now it'll probably be negative for10 years. he showed us what he cares about more unfortunately it's the old-fashioned style military conquest >> michael, thank you for your time today michael o'hanlon. >> a final look at the markets before we hand things over to "squawk on the street. the futures under severe pressure dow futures down by 773 points s&p futures down by 100 points the nasdaq off 390 the 10-year note at this point, yield has been under pressure, as well, this is seen as a plight to safety the 10-year is yielding 1.870% obviously it raises a lot of questions about what will come

next from the federal reserve. how do they deal with inflation and higher commodity prices that we're seeing as a result of this, as well. we'll continue to watch this for you every tick of the day. we'll hand things over in a moment to "squawk on the street." the three of us will be back here tomorrow morning to pick things up. stay tuned to cnbc all day now time for "squawk on the street." good thursday morning. i'm carl quintanilla with jim cramer and david faber futures are lower as russia launches war in ukraine. air and ground attacks european markets down big. vix to 37. historic implications across asset classes. the ukraine invasion front and center vladimir putin anoumpbsing military operations had begun. the offensive appearing to stretch across the entire country with explosion and