it's troublesome. >> bradley, thanks for your thoughts this morning. >> thank you for having me >> all right, folks that does it for us this morning. we're looking at things this morning with markets at this point a little bit higher. at least we've been watching the dow higher through the morning, and we'll continue to see this that does it for us today. we will see you back here tomorr tomorrow have a great monday. right now it's time for "squawk on the street. good monday morning, welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber is back. futures are steady as the bulls try for a third week of gains, something we've not strung together since last fall shanghai's lockdown in focus ism, auto sales and a job number our road map begins with the tesla surge. shares are popping ahead of the open as the ev maker announces plans to split his stock. apple's demand perhaps waning the nikkei reporting the company plans to cut output for its

iphone se by 20% next quarter. and it is a monday we do have some deal news, not a lot. hp buying a workplace communications company polly enrique lores is going to join us later this hour amc vowing more transformational deals to come, its ceo adam aron, joining us in a few minutes. >> we'll start with tesla, in this s.e.c. filing, the company discloses it will ask shareholders to vote to authorize additional shares in order to enable a split. it comes almost two years after tesla enacted that 5 for 1 whispers, jim, of dividend motivations here what do we think >> well, look, i think we're all trying to figure out and engage the level of excitement about the market and whether it's been quelled, whether there's still people buy on dip. whether there's a lot of detail, talk about the apes in retail. this shows me perhaps there's too much enthusiasm versus what

we're seeing from the mike k wilsons of the world saying bonds are sending the wrong message. i don't want to see tesla go up on split obviously i want to see it go up on production, and yet the shanghai news indicates that pruks may be down in china so david, you get the enthusiasm about the split but not a ramp up in production maybe the split is not as significant as the production. >> and that production coming as a result of locktdowns in shanghai, which are incredibly large. half of the city at one time and then the other half the next as they try to deal with a covid outbreak there still have a zero tolerance policy in china, which pretty much the rest of the world has given up hope on that. >> even hawaii. >> even hawaii finally gave in on their mask protocols inside. >> i don't know, i'm concerned about what kind of vaccination process they have in china that you would have such a severe

lockdown because here, you know, people just accept -- we get famous people getting covid every day, kind of like, oh, really, so covid she's got covid. you got covid. i mean, and there it seems like that to try to stem it would seem to be like putting fingers in a dike, i don't know how you do it. >> it is their biggest lockdown. as david said they'll do half of the city b of a talks about traders with sleeping bags so they can stay at work and keep operations going. is that why oil's down 5%? >> yeah. people think demand is not where it should be i get production numbers -- production's not up. i think you have to buy a weakness every time. i'd buy chevron in 166 why? >> well, because i don't think that china necessarily correlates with worldwide demand, but supply has simply not increased at all, and by the

way, what happened to the idea of maybe russian supply coming up >> we did have a couple of scary -- i mean, i gessner vous head -- nervous headlines. the germans are saying we're not paying for your gas and russia replying saying, well, that mike spark a halt of your supply. >> and oil goes through the roof >> potentially there's also the question as to what russian product tichty is going to look like six months out. i know how much focus this has gotten for example socklin and other parts of their oil complex that had been run in part by large multinationals. >> right >> can they maintain production without schlumberger technology. >> correct >> not kpclear. >> does it come more like what venezuela has become, significant cuts in production once they nationalize their oil business so to speak and all the multinationals pulled out.

it's not clear the russians have the technological prowess to be able to continue at the same levels they were. >> you're absolutely right the kind of technology it takes to get more out of a well is all american technology, and i know schlumberger is more of an international company but it's absolutely true that you cannot do as well without these great surface companies that are american technology. >> and remember exxon obviously and some of its partners who have pulled out of sock lin, which is not an unimportant part of production there. that's over time, but not that much time. over three to six months you could see a reduction in the actual production out of russia not to mention the continued question as to what's going to be purchased or not and how much on the open market and at discounts. >> hence that's why i want to buy chevron 165. i just see it's the production side that's in trouble. >> more than demand. >> yes in the united states, i go back over to all these different producers and they reiterate, jim, you keep expecting us to break discipline we're not breaking discipline,

except for the private equity players, david, who still have to pump in order to become public or get a bid. >> or actually just generate a lot of cash flow. >> they need cash flow. >> baker hughes, rig counts have been inching up. does that mean anything? >> it's still private companies. the big guns are represented by devon, the ceo says we're going to ramp up now the forward curve shows that oil will be lower a year from now, so we're end up spending our money unwisely and people will sell our stocks. devon is another one that's great. i think these companies really got religion about being reckless plus, by the way, the cost of a well, just like a lot of things, like building a house, the raw costs have gone up so much >> right there will be a lot of political pressure saying this is really the result of policy as opposed to the desire of shareholders that is keeping production from what it could otherwise be it would seem that that might not be correctly placed. e we talk about it every day,

the desire for buybacks and return of capital through buybacks and/or dividends is really what's motivating many of these companies not to increase production dramatically. >> totally right in theory you've got the president saying, listen, we will commit you would have to have a lot of different moving parts go to be able to make it so europe has enough natural kgas. the easiest would be to let the pipelines be partipepipelines. let's turn to apple this morning. sources tell the nikkei the company will cut its planned iphone se output by 20% and reduce air pod production. they win best picture last night with "coda." katie huberty with a note today saying are we on the cusp of moving from shipments and asps to monetizing the installed base she thinks so.

>> tim's fought me on that for a long time. tim cook, the ceo. >> oh, thank you >> eddie q., much more of a fan even than tim cook equal fan but much more exuberant. here's what i have to say about that tim cook said anytime you read a story that says multiple sources said we cut because of x those versions are not true. people are going to sell apple i say own apple, don't trade it, pretty simple, even though it's been up for many straight days i'm just saying that the idea that the suppliers are telling the press, hey, listen, that's not true tim cook does not do that. just doesn't >> i will add jpmorgan is looking at lead types which they say are not perfect and it's ex-china for sure, but they are on the lookout for shipment

expectations that need to be reined in. >> if it's $2 million versus say what katie huberty is talking about. if they start charging a subscription, you'll be getting more from this, and you'll be paying more, and remember, there's no bad dad here. everybody pays i mean, i use a credit card all the time i would like to have a bundle. i had to change my password, i've been hacked a couple of times. and i just realized how much i rely and pay these guys the way i used to pay american express that's how much i use it. >> didn't buffett call it one of the biggest values in the world, a thousand bucks to basically run your life. >> you know, it's usually your guest. >> not usually my guest. i do enjoy having michael on when we can fget him, yeah. >> he's pointed out everything's giving away the high end phone, it's a thousand dollars, and you can't beat it. if you want an apple phone, you go to t-mobile which has like the best coverage, they give you the phone. then you run up the

subscription the bill comes out at 3:00 a.m. so nobody sees it except for me, and sometimes i see it because i'm going to sleep sometimes i see it because i just get up. there it is. >> he's going to take the first part of your statement and use it in a national ad campaign. >> yeah, they probably will. >> we should mention with apple, i don't know if this moves the stock, the win last night at the oscar "coda". >> wins best picture >> we crushed -- >> excuse me >> we were kind of a docu -- >> yes, i've seen that that could move. >> interestingly, you know, i sat here for quite some time discus discussing the fact that apple did not seem fully committed to streaming. >> they have disputed you on this. >> and i think it was true but they have obviously stepped up a lot in terms of their spending the big movie that really in many ways got a lot of people's attention is when they actually spent on emancipation.

that's their next really big movie. and you know who the star of it is the star of it is will smith >> you went there. >> no, i didn't. >> you didn't have to go there >> i'm just telling you that will smith's next big -- and i know because i know people working on this movie. it's a huge movie, "emancipation," it is going to be on apple tv when they signed the deal and they had a rolot of competition it was a notable story at the time because it did show apple was a competitor here. the bigger question for apple is do they ever consider trying acquire anything to continue to bolster their effort or simply grow this organic. it has not been their way at all. >> eddie q. having the time of his life and tim cook loving shows, who he's always loved series and shows they're great consumers of it. they've always said, listen, don't rush us. when you sign in, do you sign in with the qr code how do you sign in

>> i read books. i don't really watch any tv. >> the investing club? what are you talking about >> when you go to apple plus, it's very simple now >> can i put it into my tv >> yes, it's so easy you won't believe it. >> we do air play quite a bit. >> you want to run that will smith up again because i've got this -- i watch this. >> we turned it off at like 10:15. we missed it. >> i did the same thing, but definitely getting reminded of the move today and what it may mean for hollywood down the road >> i want a little poll here, who was more scared of nuclear war after the regime change comment? >> excuse me >> regime change comment by president biden. >> president biden this man should not stay in power. >> did you cancel say a vacation to italy >> i did not i think the approach for the possibility of nuclear war should be to live your life to

the fullest. that would be my advice to you. >> i also have not canceled my european >> make a mistake in doing that. >> just saying long island looks pretty good. >> it's a beautiful island at least parts of it >> ireland, too. doesn't go that way. >> not quite as nice as the big island of hawaii, but it's okay. >> some people look where the valley winds go and cancel the trip. >> there's a lot of moving parts as we are on the lookout for fresh cease fire talks this week when we come back, a lot to talk about with amc chairman and ceo adam aron, from the movie business to crypto and theaters and a lot more a big week ahead in data at the bulls try for three straight weekly gains back in a moment i am here because they revolutionized immunotherapy.

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ark m -- adam aron says more deals are coming he joins us now discuss the high croft mining deal, last night's oscars and much, much more adam, thank you for coming on "squawk on the street. always good to see you. >> thank you, jim, good morning to you both. before i answer any of your questions, i want to apologize to you and to david and especially to your viewing audience i was supposed to appear with you about two weeks ago, the lawyers stopped me at the last second, but here i am, and i'm delighted to talk about any aspect of high croft mining.

>> all right, thanks, your apology accepted of course i wanted to ask you, i thought this was a great move from the point of view i'm a gold bug great move from the point of why shouldn't they try to figure out attractive ways to make money. i also felt if you didn't have such a strong share base of people who really love you, it might have been interpreted as something that was too different from your core >> well, you know, we knew we were going to take some flak when we did it i think i read comments that it was bizarre, stupid, idiotic, except there was one thing that we were certain of, we were going to make a lot of money now, you wouldn't think that the normal core competence of a movie theater company is gold mining or silver mining, but in this case we found a company that was exactly like amc a year ago where it had great assets, in this case silver and gold in the ground, millions of ounces

and it had a liquidity problem our company lived through that we were expert in raising money, and sure enough, it's only two weeks after we did the hycroft mining deal, wes announced friday night we helped to arrange $195 million in equity in two weeks it's already a huge success tory. >> but let me follow up on what you always said would happen, you felt like you could go on the offense in theaters. there are many theaters that have gone under, obviously, people returned because these big hits, you can make a lot of money. why not stick with your core competence it seems like it's coming your way anyway. >> well, we're going to do that what you just described. three things that we're going to do remember that the amc shareholders armed us with a $1.8 billion war chest to play on the offensive those numbers as of december 31, 21, the last quarter end, and we said we're going to do three

things with that money we were going to grow and improve our existing core theater business, and we've already added about a third of the pacific circuit to our system i can tell you that there are going to be more announcements coming about more theaters being added into our system, good ones, important ones in markets that we value. second thing we've got to pay down some debt, and third thing, we were going to look for transformational smrkm&a opportunity, and that's what we found in hycroft mining. >> adam, it's david. back to this idea of core competence and what you just said, you're experts in raising money, it would seem to me -- and correct me if i'm wrong -- that you see a real opportunity here as a competence in terms of finding another business perhaps that is in a cash crunch position and applying what you now have as this following of your shareholders to basically

turn their fortunes around, whatever they may be in this case it was hycroft, the next one might be another one. is that the new core competence of amc to sort of use the memesters that you have to help turn around the fortunes of a company because they're willing to put money behind it >> well, look, i think i have to say the answer to your question is yes, and we proved it because in addition to the money that eric sprok put in, who's a gold a and silver mining expert, we have some real credibility in the investment in hycroft, if it wasn't an impressive mining potential, sprok wouldn't be there with us with his own money and the money we put in, we just raised another $139 million in nine trading days. $195 million going into the company that three weeks ago had a -- i guess it's two weeks ago had a market cap of $19 million. this is an enormous amount of

capital -- >> right >> yeah, and was facing potentially its own cash crunch. they're going to need as much as a billion to make this true transition isn't that correct get that new to process in terms of the mine when it comes to sort of the oxide or running out and being able to process the sul fie dor. is that correct? >> we are going to leave the running of the gold and silver mining to the experts. we're experts in balance sheets. eric sprok is expert in gold and silver what you've described is true. there are exploration sites not yet in full production that are valued at levels that are, you know, infinitely greater than a $19 million market cap this company was basically priced at bankruptcy levels because it was facing corporate debt a few weeks after we invested had we not invested and so -- >> understood. >> yes, if we want to go into

full production, we're going to have to put in a milling operation, if we want to go into greater exploration, it only takes tens of millions of dollars to explore more than the 2% of the 71,000 acres that currently sit at the hycroft mine in northern nevada. >> adam, you know, we've had you on for quite some time during the period where your stock price has elevated significantly, and i've been making a point that, you know, many believe your valuation has not been supported by the fundamentals of the movie business do these moves reflect that belief of your own that your fundamentals are not supported or i should say your valuation is not supported by the fundamentals of the movie business >> yes, and i've been saying that at amc. i've been staying that publicly since last june. our shareholders had given us a lot of capital they trust the current management team, they expect us to deploy that capital in

growing amc and transformational m&a, so as to grow into the valuation that currently is out there for amc, they're expecting moves like hycroft, and as you know, the market response to the amc investment in hycroft was very positive both for hycroft and amc. >> what does the company end up looking like a series of investments in other companies similar to hycroft >> first and foremost, we're going to make sure we get a pandemic recovery of our core business going into the pandemic we were the largest, most successful movie theater company in the world. that's where we are today, but that's not the same thing as we were in 2019 so we're going to continue to bring the old company back, but yes, i think we're going to be doing interesting, exciting things to grow amc, to transform amc, to find attractive investment opportunities so that we make sure that we do grow

into that valuation that's out there on wall street every day, if that is all humanly possible, and i can tell you that the management team at amc and our board, it's a 24/7 commitment to growing our company, transforming our company, making it a bolder and grander company than it was before, and hopefully it works out well for all involved. >> adam, let me flip it. are you surprised given the success you've had in raising money based on people, shareholders who actually enjoy you, you could say call the person out or people just believe in you because of your successful track record, are you surprised there are not other ceos who are seeking a level of engagement with their shareholders, they're going to allow them to have much more freedom to do so. >> if you'd asked me that question a year ago, i'd say no, i wasn't surprised it was a pretty novel thing that a ceo of a medium sized public company would embrace retail

investors the way we did amc but that was a year ago. yes, i am amazed now that others have not followed in our foot steps. as you know, i talked with our investors almost every day through twitter, both the message i convey and the thousands of inbound messages i get that i actually read myself. it's so important to talk to your shareholders, to talk to investors, to listen to your shoulders to listen to investors. i do think this is the wave of the future we have great respect for the retail investors who own amc i say many times i work for them it's their company, i'm a big shoulder too, but it's their company. we care what they think. we listen to them. we act, and yes, i think it's going to be a model for other companies to follow going forward. >> all right, so in m&a further, are you looking for niche

opportunities where you know you'll win from day one or do you say you know what, i think the price of oil may be going higher or maybe you think raw materials are a good investment. is there anything in particular that would interest you as the next buy >> when you go back to hycroft, right, we knew the response was going to include they did what a theater company bought a silver mine in nevada and a gold mine in nevada, what but if you're ever going to buy gold and silver at a time when the world is chaotic, with what's going on in ukraine at the moment, tragic, these are uncertain times, precious metals do well in uncertain times i think my preference is not to be a speculator. my preference is to be an investor, and we did think that we had an instant win with hycroft because we had every company in the world to help to

raise money. the proof is in the pudding. it only took two weeks. >> i do want to get to the oscars or at least to sort of -- i mean, the best picture streamer barely showed in a movie theater, you know, reflects the change in viewing habits of course with the public many say this is the end of the movies in a sense but also a new beginning. do you get enough people to fill seats when we can all sit home and watch what is the best picture on any one of our potential streaming options? >> you do remember that spider-man no way home was like nine days ago, it's only the third biggest movie of all time. >> i knew you were going to go to spider-man. >> a superhero movie in the movie theaters, is that it >> but wait, how about- i think it was david who asked me. what's coming, top gun maverick in may is going to be huge jurassic world dominion is going to be huge how about avatar 2 at christmas. i've seen footage, it's going to blow your mind it's going to be a huge movie.

so i've been saying for years that the market is big enough for streamers theaters to coexist. i'll say just one last thing we've been engaged with the streamers, especially apple, amazon, and netflix for years trying to convince them to show their movies in our theaters as well as stream them. if we can convince them accordingly, i think they will even be more successful than they are now or were last night and amc as well. >> we're almost out of time. i do have to ask about the will smith slap heard around the world. does it hurt his marketability at all as one of the biggest movie stars in the world >> this is going to be amazing, but that telecast was over four hours long and i was not there for ten minutes of it. i went out to get a drink of water at the bar, and they shut the doors behind me and said you can come in in the next commercial break, and those were the ten minutes where the chris

rock, will smith incident occurred i didn't see it, and therefore i shouldn't comment. >> didn't see it >> that's perfect. >> adam, i congratulate you. i think other ceos should be trying to cultivate their shareholders your shareholders are quite voci vociferous if you could tell them i like them in real life, it would certainly help my security forces. >> i'm going to say this before you take me off air. jim, i've known you for a decade i think you're an extraordinary financial journalist i know that in the world of twitter people can be a little aggressive with some of the negative things they send. they send some of those to me too, i might add but i to think the world of you and i hope that our retail investors tut you some slack >> well, adam, thank you so much good to talk to you.

>> on the big board, it's terry nor bin celebrating its listing via spac we'll talk to the ceo of the satellite maker in a little more than an hour nasdaq, porch group, software provider to home services companies. jim, one thing we didn't get to in the first half hour was the inversion, more inversions of the curve. >> look, a lot of people feel the curve never lost that it can never be wrong i think that this time -- one of the things you're never supposed to say is this time it's different, but we have a lot of people now shifted to a higher -- the worse a curve goes, the more people think that jay powell's going to run into a hard landing, which therefore is causing people to take numbers down throughout the entire complex. if if this quarter is going to be the last good quarter and a lot of companies are going to have to say bad things some will be good, some will be bad. the idea of painting with a broad brush could be a mistake.

>> it's certainly what led morgan stanley to cut some b banks. they cut citi to underweight the broader view from mike wilson in his fire and ice world where ice is the slowdown, the global slowdown, banks he says will underperform. >> that was an incredibly negative note. david, mike wilson -- >> sorry, say that again >> mike wilson had some negative things to say about the market when you were away. >> yes. >> just like before you were. >> yes, he's been negative. >> can didly the market's been n fire maybe now we're ready for ice, fire and ice >> i suppose. >> fire and rain. >> all the banks are down and have been down this year, which we've talked about any number of times. yeah yield curve not helping, helping? >> supposed to buy them. >> aren't they that's why i looked at you with a puzzled look. >> very puzzled, it's a group that we've seen this over and

over again, especially say in the early '90s where the fed wanted to reflate the balance sheets i don't buy the negativity of the banks. their loans are terrific in this -- today was about russia and how that could lead to lower loan growth, and i'm just not buying that either. i think that the vast majority of people are like david, just say listen, go about your life go about your lending. go about your borrowing. go about your growing. that's -- i don't think that people are saying, oh, ukraine, i'm not doing any business i don't see that >> no. >> it's not ukraine. it's the energy shock from ukraine, the commodity shock from ukraine, right? >> i just -- i don't know. what happens if the war ends >> it's still going to take quite a while for all those other things to even out i mean, we're not going to start buying things from russia anytime soon those sanctions are going to

remain in place for a long period of time, and unfortunately the country of ukraine is being destroyed by the russians >> gdp russia same as the gdp of italy, but russia's got the world hostage. >> but to carl's point there are certain commodities that are important for certain industries that are produced in abundance by russia. to a certain extent ukraine. let's not forget food and wheat, which is also going to play a role in food inflation. >> 13% of the calories are from ukraine. >> okay. so there's the point so which is it >> that's certainly what jpm says today >> sell the whole. i mean, where was he during kind of had like a double -- >> he did add ad co. to the list they were adamant, they do international, the farmers will buy anything worldwide and the soy harvest is going to be bad they are actually predictionng famine the interview was very

apoca apocalyptic. another thing that made me a little more nervous. famine as they said does breed revolution historically, so there's just -- that's why i say, there's a lot of apocalyptic talk i can't figure out the p.e. of the apocalypse where do you think cuts the p.e. of the apocalypse. >> i think it's infinity i don't think you need to worry about it that's the news. >> you're just so joyous >> the nuclear war -- >> you don't really need to worry about it. >> you don't >> i may have to put together an apocalypse index. >> i'm going to sell spam, i'm shorting spam.% >> there was a downgrade of hormel >> you did >> you love hormel hormel's doing well, mccormick is doing well. not campbell's, every day there seems to be someone -- >> well, and also similar rbc

takes altria down today on concerns about walmart, halting cigarette sales. >> i've got that confirmed that it is true i'm trying to get whether it hurts their earnings we maybe remember when cvs decided to stop selling cigarettes because they wanted to be more of a health company i don't know if we have a chance of cvs versus walgreen's, the difference cvs went all health, and it's been a remarkable move by them. wow, look at that. will you look at that? they had to outflank hamazon and they did. >> they really did. >> isn't that an amazing differential there >> they also own big health insurer, aetna, but yeah, that's a nice reflection on -- not running the company anymore. >> no, but he set it up very, very nicely. they also got the benefit -- so many people went there, i got my vaccines there, a lot of people went to get their vaccines

because it was, quite frankly, they're everywhere karen lynch has done a fantastic job but look out, we have a new ceo at walgreen, ros brewer who's amazing. i think that they report this week i think ros brewer i zbl do you want to hear what might have happened had she stuck around at starbucks? >> kevin johnson's signaled to us that he was leaving i didn't get the signal. >> neeither did the board apparently as we said many times. they missed the signal. >> these could be tough to -- >> i know, what was the frequency? i didn't know what the frequency was. >> it was i'm out in a year. >> missed the signal. >> during my 16 interviews with him i didn't get the signal. >> suddenly in march they're like what, wait. >> we better find howard schultz because he's the only phone number we apparently have.

>> howard should have called i and urged them to do that, so far successful, but that -- >> i was trying to get ahold of charles. >> you were? >> that's called reporting. >> to what end >> i failed. >> what end? >> yeah, what's the frequency? i don't know. >> you don't even know you're trying to get ahold of him, but you weren't going to ask him. >> he's got a five-month succession plan. i happened to think kevin was doing a great job. i would like to know if it was unions, the union drives i mean, look, technology at a starbucks is extraordinary what are you going to do when you have china you go to shanghai, how are the starbucks doing right now? >> it's very curious. >> i know you're looking head and shoulders. >> i made this point on the day in question about the board and the signaling. we had a joke at their expense we continued to, but it's not unimportant. it's what a board's supposed to do. >> if your ceo gives you a year ahead of time, they just said you should know who's going to take over. >> why don't we fill people in

on what we're talking about. ros brewer left to go to walgreen's, a couple of months before they got the signal. >> maybe leave it at that. that's about where i want to go there. walgreen's was the winner this, and i'm telling you this week's going to be crucial. >> and they both benefitted from the same covid tailwinds reports over the weekend that the u.s. will be looking to boost those over 50 rather than 65 would be a pretty big pivot moderna's up 5%, i think, all summer >> yeah, i know. now walgreen's does not farewell in the dropout, in the theranos dock ewe drama because they look so stupid, it's incredible dr. j. you haven't seen it, theranos. >> i haven't seen it, no. >> you might want to give it a look-see walgreen's was a huge buyer. >> they were >> but anyone could have been fooled. >> former management got sucked in by elizabeth themholmes.

>> they did. >> they were not alone. >> no, they weren't. >> safeway wanted the deal too general mas ttis was on the boa. >> his grandson was the whistle-blower >> it's worth watching >> jim, adam aron mentioned the apes so to speak, and coinbase is zbgoing to benefit as bitcoi tries to erase its losses for the year. >> isn't that something? has done yeoman work more people should be like him it's obvious there's an upward move here the likes of which is really rather extraordinary, and it's worldwide this is at a time when the s.e.c. is trying to make it a security, and i've got to tell y you, this is a monster move, better than anything i've got to tell you, i wish there really were more champions because it does seem like it's a

kind of bold retail, and i don't think that's true. i think there's more institutional money than people realize. >> and crypto overall. >> i really do especially when you see these numbers, 30 to 35% people claim to own crypto. it's not just millennials, it's not just gen x or gen z, people don't transact so it's a store holder value, or expectation. i think there's institutions that are buying these. you couldn't move this well. look at these moves. that's not retail. >> many of those who talk in favorable terms about crypto have talked about the institutionalization of it as being one of the key drivers, right? so you're saying that's in process, that's happened. >> maybe the next move by adam aaron, a very speculative gold mine the gold people come on, they have money to supply how fatuous this move is, but maybe they're jealous. >> speaking of going positive for the year, tesla just went

positive for 2022 as well, first time since january. >> it's been very, very strong. >> seeing it in the green today. >> when you want to see what stock is negative, you have to take a look at 3m which continues to lose its share of these arm cases, which produces tinnitus, and when you go look at the orders by the courts, it's very clear they have very sympathetic plaintiffs and this is not going to go away for 3m as much as i like the company, my father used to sell scotch tape, these lawsuits are very da dangerous. >> the ear bloodplugs that did t operate. when you have a sympathetic plaintiff like that, 3m has won many cases but the big awards are daunting for a company >> when we come back this morning, we'll check in with hp and the ceo on their deal to acquire audio and video product maker polly. before we go to break, keep your

eye on treasuries in the bond market, the inversions of 530s, ten-year got close to 256 today, that's the highest since may of 2 2019 right now settling back to under 246. we're back in a moment >> the bond report is brought to you by pimco, a global leader in active income.

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hp announcing plans this morning to acquire audio and video product maker poly it says it looks to boost its portfolio of hybrid work devices and the like joining us now in a cnbc exclusive is enrique lores first off, why are you buying this company >> first of all, thank you for having me here it's a very exciting day for us. it is all about winning in the hybrid work. hybrid work is opening a key growth opportunity and the combination of poly and hp is going to help us to accelerate

our leadership in that space, support the creation of growth portfolio for hp, and it has a very strong financial case it's a win combination and we are excited about it >> i mean you're talking about as much as a 15% compounded annual growth rate for this company. it has not put up anywhere near those kinds of numbers even during the pandemic and the growth and work from home, and i think its last year-over-year number was up 4% what are you going to do at hp that's going to super charge that growth rate of poly >> there are three key things we are going to be doing. one, we are going to be accelerating innovation, combining their portfolio with hp's portfolio second is about the synergies we can bring from our go to market perspective, combining the specialized sales in audio, video with our retail and commercial teams, and finally leveraging our scale and supply chain, the growth or lack of growth this year was impacted by

the supply chain availability issues and our scale will really help them to grow faster >> so right, all right, they did blame on their last call as well supply chain issues, and why can you do better? what is it that hp is going to be able to be able to navigate in a way that is going to allow this company to get past some of these supply chain issues that conceivably held back its growth >> it's important to realize that in situations like the one we are facing, scale matters, and our scale to support and drive our business will help us to make a difference from a component availability perspective. >> enrique, thank you for coming on the show. i'm holding up my hewlett-packard right now, and i have to tell you i find the sound quality particularly poor. i try to watch things on it, it never gets loud off. i thought why can't you have better sound yourself? why do you have to go buy someone. you're a great company with great technology

i've never felt that the company you're buying has anywhere near the quality of technology that your company has. >> what they have is a very strong portfolio of ip in audio in and video they have 1,100 patents in these two areas, so using that technology to improve not only the quality but to build a computer portfolio from hybrid, is one of the reasons we are so excited about this acquisition. >> i know that you have the founder and ceo of zoom quoted, did zoom want this company because i know that zoom is looking for an extension of its business >> well, zoom zis going to be a great partner because there is a big change in the audio, video conferencing system to open systems and cloud. we will be partnering with zoom. we will also work with teams like microsoft because both of them are going to be investing in this area it's all really about the experiences, we are going to be

able to deliver to our customers combining the quality of the solutions from poly with our compute systems, with our manageability we can create unique experiences that will helpt us to grow in this space. >> a lot of this seems to be based on your belief, obviously, that the hybrid work conditions, so to speak, will continue, you know, that, therefore, there won't be everybody in the office, and that dispersion will lead to more use of these products i guess you say work from anywhere, 68% expect to work from home at least three days a week that was a survey i guess you did last may of 312 end users. you really believe that, 68% of people are going to work at least three days a week from home >> this is actually, for example, what we're going to be doing in the company we are going to provide flexibility for employees to work from home, to work from the office, and we think that flexibility is going to be key from an employee satisfaction

perspective. so this is the model that we are putting in place, and this is one of the opportunities that we sea. the other big opportunity that we see is an improving video conference rooms we also have shared this morning that our estimate is that in the world there are 90 million 90 m. only 10% of them have been -- have video conference equipment. this market is going to triple in the next three years as people will have to enable that to allow people to again work from home and work from the office at the same time. >> enrique, hate to resurrect the conversation we have had several times last couple of years, but we spent some time this morning talking about the shaping high lockdown and the potential effects on supply chain, electronics and so forth. do you get the sense they are getting any better at this, managing waves without totally shutting down their production >> well, what we saw in china is the production at the very beginning of the pandemic.

since then they have been much more selective in fact, this has not had a big impact in our production in the last month despite going through lockdowns, there is nothing impacting us in a severe way >> finally, enrique -- >> let's get a couple more. >> you want a couple more? >> go ahead. >> enrique, a quick one. i have this window, they slipped down -- i mean, i open it up, it's completely different. it runs much better on a brand-new hp this was a windfall for you. isn't the windows 11 >> it has helped on the consumer side, on the commercial side has really not started yet the transition is going to be starting in the next month but because of the usability task, we think this will continue to help the strong demand we continue to see on the commercial side. >> all right and now i will get to the final question, enrique, which is your stock is down over 5%. you had a conference call. you explained to some of the

shareholders why you believe this is a good deal. are they missing something it's one day it's early. this is your opportunity to sort of address that. are you disappointed to see that down 5% number >> we are in this company for the long-term and the long-term value we are going to be creating we strongly believe in the opportunity that we see on the hybrid space we think is a winning combination because of the portfolio, the technologies that they have and go to market we can scale. the financial case is very strong long term this is a great acquisition for hp and we are very confident about that. >> all right well, enrique, appreciate your taking time with us. thank you. >> thank you have a great day >> you, too. dow's down 119 financials and energy not helping much chevron and jpmorgan among the worst dow components tesla up six is going to help not only consumer discretionary but help support the s&p holding

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time for jim and "stop trading." >> trying to get companies that stocks have fallen badly

people had sales home and upgrade. it had been a sell, you know this had been a very, very weak stock. but today duck horn is upgraded by rbc higher income, stock's ounce 25%. i don't know so the people selling it and sell it and selling it, this was a positive recommendation. it's a very good company i think a lot of people feel what's the growth? there is growth. >> the one thing we didn't get to was goldman cutting chips, microchip, teradyne. >> this was again on the idea that it's cellphone, cellphone i am not kidding when i said that enrique got a windfall on this microsoft 11. you don't have enough power. you have to have a new machine particularly the verizon, very good chip. intel, too be aware in the -- go online and the critics, it's all about how

enrique is the beneficiary and delve windows 11 and the rest are not. >> tonight >> okay. i've got a company that's its stock -- it's like 400%. i don't know if you guys know, adrian shap i.r.a., a retail analyst at goldman unbelievable -- including nest i always buy nest products and then herschel backpacks, new stuff tonight. and stuff you might want to get your wives >> okay. i'll keep that in mind. >> mother's day not too far. >> exactly i hadn't thought about that. now we have to go. >> see you at 6:00 "mad money." more reaction to tesla pushing n'gonyerlit. n'gonyerlit. dot awhe.

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♪ good monday morning. another hour of "squawk on the street." i'm carl quintanilla with morgan brennan and david faber. s&p continues to circle around

4550 a big week of data ahead, jobs number friday, the shanghai lockdown and hopes perhaps for a fresh round of ceasefire talks. >> we are 30 minutes into the trading session. three big movers, apple. a new report by japan's nikkei saying they are cutting their planned iphone se output 20% next quarter citing weaker than expected demand. shares down fractionally now coinbase closing in on a deal to buy 2 tm which controls latin america's biggest exchange the parent of mercado bitcoin, those coinbase shares are rallying on the news of 6.5% finally, foot locker sliding after getting down dpraded to market perform from outperforming cowan. the firm saying despite an inexpensive valuation, they may be underestimating impact of

inflation. down 4.5, 5% now, down 30% year to date. carl. >> one name going green so far this morning is tesla. the company says it wants to split the stock to pay a stock dividend to shareholders and suspending production at shanghai gigafactory as they go into lockdown over rising covid cases. elon musk says he has tested positive for covid himself no symptoms. joining us this morning, roth capital tesla analyst craig irwin. on the split, what do we think the motivation is? is it about changing the investor base? is it about some sort of index inclusion? something else >> some companies usually put splits in place when they are confident things are going to go very, very well. the last stock split was a tremendous catalyst for tesla. if we look forward for '23, '24, '25, new models like the mini car, you have germany ramping. you have so many initiatives

like india that they should -- they should give us good visibility, hopefully, this year it's been too long but these are big levers the company can pull and will pull, and, you know, i think they will be positives in the valuation. that's why i keep the neutral despite being bearish. >> right yeah, 250 is rather bearish. on production, gig a berlin, commentary that will help q1 momentum on delivery now shanghai which is going to win out? >> i think the puts and takes is very, very hard to know exactly at this point. if people want to know they should look to the registrations data, victor earl and his team out of sweden do a phenomenal job there globally we are going have to wait for that data to really know reality is, you know, i don't think we have a miss coming any time soon.

i think they will continue to tweet on dplis, do a spectacular job. the question in my mind is, you know, 1.5 million the number for the share to beat that quite possibly we do so shanghai is a speed bump, but it's not something that we see as really a major impediment in if anything, there will be demand in china. >> with tesla trading over $1,000 a share, why the $250 price target >> so you look at the largest automotive company globally, toyota, right, they have about a $300 billion valuation, they sold 9 million cars last year. there is nothing that tesla has that toyota doesn't as far as technology toyota has a much closer relationship historically panasonic than tesla tesla has a $1 trillion valuation, they sold 900,000 cars, you know okay we should give them a very

chunky premium for leadership in evs, right, creating the ev market but i think 300 billion is closer to where this thing should be. 250, 300 billion, not a trillion by the end of 2025 there are going to be 500 ev models on the road, 16 ev models coming this year, many will be successful. tesla has done a spectacular job and should be rewarded for that. a premium valuation would be a third of where the stock is now, or a quarter. >> i get that. and certainly in terms of absolute numbers of vehicles that are being sold and manufactured, tesla is still a smaller player that being said, there has been emerging narratives that tesla is kind of the maturing leading option when it comes to evs specifically you don't buy into that? >> i completely buy into that. i think tesla -- tesla's a very exciting, interesting company. i just don't see them doing 20 million vehicles i think that's too much

competitive pressure others have moved fast and maybe not done the optimizing of their technology porsche is a great example they should have had silicon car in the drive train, will make those changes and it will be fully implemented by 2025. tesla's valuation is really a function of the scarcity of successful companies in the sector you know, by the end of this year i think we will see a few more that are treated with fair to optimistic valuations we have already seen a couple of those. and that's why i'm saying i think people are much better off in the small caps right now. >> craig, finally, just to get sort of the global supply or lack of it of certain commodities that are crucial for the making of batteries and other things involved with ev, is that a concern in terms of the costs that these manufacturers are going to have to potentially pass along? >> so the cost of batteries is a

point of controversy i have been on controversial side for years you recall that when i initiated a couple years ago i said that actual battery prices double what tesla was claiming. this last week we saw tesla raise the price of the mega pack by 25% battery costs materially higher than what the consultants are saying tesla does not have a -- in battery technology and the price increases we have seen in the last couple of months are walking of these rising battery prices impacting vehicles. now, that is a headwind on totaling market adoption, right. but it's not a big one evs are absolutely inevitable. 500 echz that are coming over the next few years, i think may have a really good chance of being wildly successful. you look at the energy security issues in europe, you look at gasoline prices, these push people to want to own evs and, heck, i ask everybody to test drive an ev before you buy your next car

you know, i did and, wow, you know, the performance, i test drove many, rights, but the match for what i wanted. i'll probably never go back. i am bearish on tesla, i am not bearish on evs they offer an incredible opportunity. >> yeah. it reminds me of what the daimler chief said to the ft over the weekend, the cost of building a battery-powered truck at least will, quote, forever be hire than a combustion engine equivalent in part because of what happened in the last month or so you don't think it's that much of a disincentive long-term? >> trucks are special because payload is important and the longer your range you need, the bigger battery i am not a big believer in long-haul ev trucks, maybe distribution center to distribution center. shuttle school buses are the area of the market that i think is ripe for aggressive adoption. president biden's put in 7.5 --

sorry, $5 billion in funding for the skchool bus market that is a market that will work. there are areas that are more economically sensitive and some less sensitive to battery materials and other commodities prices and absolute vehicle prices i think it's going to be really self-evident that there is a lot of opportunity for success the next several years and i think this year is a key year where we get data points from many of those companies. >> craig, good stuff covered a lot of ground about tesla and the industry at large. see you next time. craig irwin. >> thank you. turning to the broader markets. markets commentator mike santoli looking at the action so far. >> yeah, david, you know, the stock market at least continues to absorb these fast moves in other parts of the capital markets. reprice of fed intentions in bonds. you are seeing the japanese yen kind of crash against the dollar right now. and really just this general reset of expectations in terms of how rapid and front loaded this tightening cycle is going

to be. we have gained back 60% of the correction losses in the s&p 500 and since the fed came out and officials started pushing the 50 basis point move next, stocks up 10%, volatility down, credit spreads. so at least for now it suggests that investors are willing to buy the premise that we're heading for some kind of a soft landing. of course, that's won't be determined until later bond market says fast tightening and cut rates next year, year after. that sometimes happens ahead of a recession, sometimes it doesn't. 19 1994 is an example whoa saw a round trip without being on the precipice of recession of course before we got covid pushing us, guys. >> stay with us. we are going to bring in rbc capital's amy silverman to the markets. mike talked with volatility being down it's incredible that even though we see stark moves in the bond market, the s&p is up over 8% in

the past two weeks it's recouped all the losses since the russian invasion the nasdaq 100 gained 11%. what do you make of the market action we are seeing >> yeah, look, it's pretty staggering, you know, if you actually take qqqs since march, up 15% and bond-related proxies that you mentioned, ie or tftlt is down 7% and vix is basically back to pre-ukraine crisis levels and the question is, you know, has anything changed geopolitically that would justify that decline in uncertainty. i think probably near-term volatility is too low now, in particular even if you take out the ukraine sky scrisis, we are heading into earnings which historically is a good catalyst to own volatility and to see volatility rise. >> mike, to go back to the 1994 example, how similar are we in

terms of history i mean, was inflation high in the early to mid 1990s does it actually serve as a closely related template for how the fed could execute on a soft landing? >> well, there is a reason that fed officials love looking at 1994 because it was this nearly perfectly executed mid-cycle tightening that didn't push things towards recession very dramatically i would say there are some similarities we are seeing a sideways choppy stock market with valuations getting compressed as people expect the fed to move 1994, you also had a lot more labor market slack than the fed was giving the economy credit for at the beginning unemployment was above 6%. the fed was being preemptive unemployment fell dramatically during the course of the tightening cycle corporate profits did well i think you have some of the makings. we are at higher absolute valuations now and quite intentionally this fed is not trying to be preemptive. they came into the inflationary

period saying we are going to let it run a while, not try to anticipate and get in front of it and that's leaving us in a different spot, i think, than the sporting place of '94. >> you know, it's another morning in which we are looking at various curve inversions. today it's 530s. and that's met with a response that qe distorts the overall curve and we won't know what the true curve looks like until we start reversing that purchase dynamic. is that true do you believe that? >> that's for me, carl i don't think that we can necessarily say because the fed is running a huge balance sheet all of a sudden the longer end yields are not reflective of something. we saw them. we've seen them move from 1.7 to 2.5 in, you know, a few months, a couple of months time. it's not as if they can't move relative to supply and demand. but i think you can say that the yield curve inversions themselves are not necessarily

telling you something specific about the economic cycle they are saying there is a certain window where the fed hike it's front loaded. after that we don't think they can actually keep or get rates much higher, and therefore that explains so kinks in the curve. >> amy, incredible to think we are go going to close the month and the first quarter. how would you advise positioning coming into that season which is perhaps nor critical than it has been in a really long time given the fact that other dynamic, macro dynamics in the market are different than, say, a couple months or year ago >> yeah, i think it's extremely critical and historically when you look to past earnings seasons. there are a couple of things that become very clear the first thing is that in the first eight quarters the first two are always times to own volatility so we are positioned to tone that volatility in particular as we see near term volatility

having declined. the other thing we also looked back into the 1990s, looked past the last 30 years to different volatility regimes and when you enter different cycles in a high volatility regime, which we are still at a vix above 20, that's typically pretty bad for stocks over a 30-year period of volatility regime the medium to high range gives you an average market year of about down 10%. >> love those historical references and you both brought them today. thank you for kicking off the hour with us, amy and mike. as we head to a quick break, our roadmap, including cryptocurrencies bouncing back bitcoin notching the highest level since early january. plus, president biden is expected to propose a billionaire minimum tax. it may be more of a marketing effort than effective policy. and a live report from china adds the country's largest city, shanghai, begins a two-stage ckwn taylodood as more "squawk

on the street" is straight ahead.

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. china is shutting down shanghai in two phases to control covid. our eunice yoon has the latest this morning >> hey, carl well, shanghai 's two stage lockdown is meant to test the entire 26 million population in shanghai for covid over the next four days. so from today until friday the

east side of the city is going to is stay shut and then the west side is going to restricted until the following tuesday. so in the lockdown areas residents will be required to stay in their homes unless they have medical reasons to leave or essential work, public transport and ride-hailing is suspended, nonessential companies and facts reese will remain closed some exceptions for those that have set up a closed-loop system tesla has reportedly halted production for four days, shanghai disneyland remains closed and the phased lockdown comes at a time when shanghai had been insisting up until the weekend, actually, that they would not go into lockdown because of the importance of the city as a financial and global trade hub. the officials have said that they are going to prioritize cargo trade in order to try to minimize some of the economic costs as president xi jinping has mandated the port, airport, rail lines will stay normal

highways are going to stay open with covid tests required for those traveling out. the stock exchange won't be affected authorities say that infections got too large scale for them to stick with their original plan which was, has been a rolling mini lockdowns around the city the city reported 50 new cases and 3,000 asymptomatic cases. >> thank you for the latest. as we head to a break, christmas tree swees underperforming as the house oversight committee probes compliance with russian sanctions. shares down 2.5% now there is a lot nor "squawk on the re" rahthe, ay with us. aadst it's a mixed picture for the it's a mixed picture for the major averages before we board. excellent. and you have thinkorswim mobile- -so i can finish analyzing the risk on this position. you two are all set. have a great flight.

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- as soon as she saw this, i did it and it's here. - [man shouting] yeah! (upbeat music) - [narrator] next term starts soon. visit snhu.edu welcome back time for our "etf spotlight. seema mody is looking at brazil and latin america, outperforming other major global indices can the rally last >> hey, that's right if you look at the performance of last week, emerging markets

saw $3.5 billion in inflows last week led by brazil and latin america. if you look at the u.s. listed ewz etf it's now up over 30% this year, outpacing the gains of nearly every global market as fund managers continue to move money out of russia for context, the s&p down 5% this year. and even with this year's gains, strategists at bank of america, merrill lynch write that brazil's valuation is still at an all-time low following last year's horrible performance. price to ratio, price to earnings ratio 7.5 times they say latin america is, quote, ripe for outperforms. also adding it that rate hikes in brazil are peaking whereas here in the u.s. we are just getting started. inflation risks though are adding up. jpmorgan revising the forecasts for brazil to around 7% for this year the country is also the top producer of sugar, soybeans, coffee and does rely heavily on russia for fertilizer dwindling supply and of course higher

prices could pressure its exports. for now, david, the market is overlooking that concern >> seem a, thank you. as we head to break, keep an eye on shares of hp. it is buying communications technology company poly, helping people work from home and/or from the office in terms of connecting with colleagues not in the office. it is a bet on the growth of hybrid work many ways. you can see the stock not responding positively right now. poly's revenue growth last year was not particularly strong, 4%. hp says it believes it can garner as much as a 15% compounded annual growth rate from the company due to synergies, due to its ability to improve supply chain issues the company has been dealing with as llng0 yi 4bucks a share all cash cash we're back after this.

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another round of talks with russia scheduled tomorrow, ukraine's leader is prepared to talk about concessions to end the war, quote, without delay. in a video call with russian journalists, vasquez said, quote, security guarantees and neutrality non-nuclear status of our state we are about ready to go for it. he said ukraine will not give up territorial integrity. russian continues its assault on eastern ukraine. in this video teachers, parents and some the older students worked to clear rubble after a school hit by a missile. a former student told reuters let everyone see, let no one say it is fake news. and the g-7 nations will not use rubles to pay for natural gas. an official said they agree it is, quote, unilateral and a clear breach of existing

contracts. russia demanded that it calls what it calls unfriendly countries use its currency for energy payments. that's the latest. david, back to you. >> thank you. well, president biden is expected to propose a new minimum tax plan that would largely target billionaires when he unveils his 2023 budget robert frank has that for us robert >> good morning. well, it is being called the billionaire minimum tax but it applies to households worth $100 million or more. that's the top 20,000 households or top 0.1%. it would impose a minimum 20% tax rates on all income and unrealized capital gains that's the big change here that's a stock or business that has appreciated but has not been sold or realized taxpayers would have ten years to pay that first one-time payment for lifetime gains they would then be taxed on the annual change in value going forward. this creates a longer-term

payment stream so the stock goes down, they can apply that credit to their future payments. now, let's take mark zuckerberg as an example of how this would work for 2021 he would owe $25 billion as what one-time tax. going forward, he would only pay for the annual change. this year he is down 41 billion, so he would get a tax credit of about $8 billion leaving him with a $17 billion balance with the irs. now, if he ever sold his stock, these tax payments would be credited towards his eventual capital gains tax. the rule on liquidity assets and private companies still being hashed out, but they would also be subject to this tax the white house says the plan would raise about $300 billion over ten years about half of the revenue, though, would come from america's 720 billionaires david. >> and then they can give us back our salt tax deduction? just kidding, robert

how is it workable with a private company. how are you supposed to value a private company in an effective manner >> yeah. and the reason that's such an important question is because if you look at that group, $100 million or more in net worth, most of those families get their wealth from private companies. and we are still awaiting the details of that. my understanding is they would be required to pay that first lifetime payment on the total value of the appreciated asset, but then going forward they would not be required to do it every year they would pay some kind of interest payment to the government based on some complicated calculations so they wouldn't get off scot-free. then they would pay the tax in full when it was sold or it was passed on to heirs so that is the big question in this, is how you would treed liquid assets on an annual basis. like you say, it's almost

impossible to value a private company on an annual basis or that change. >> this is a tricky one. we will have to see how it evolves. thank you. sounds like a little salt in the wound there. today president biden will unveil his latest budget proposal for fiscal 2023 amid war in ukraine the request for military spending which will map out the administration's priorities for five years is seen as the catalyst for defense and space stocks here is what we're expecting white house expected to seek $813 billion for the overall national security budget including 773 billion for the pentagon that would be 4% greater than the 2022 fiscal budget signed into law earlier this month. significantly more than what the white house pro cojected for 20 year ago the proposed budget which analysts believe congress will boost crafted as russia was preparing to invade ukraine but the longer term, quote, unquote,

pacing threat of china in mind what's anticipated though we won't know the details until this afternoon more money for r&d, which is a forward indicator of future investment for defense contractors, more money for procurement of new systems in focus or analysts, nuclear modernization, so b 21 bomber, icbm replacement program, the columbia class submarines, missile defense and space-based deterrent systems, hyper s hypersonic mills, also how many f-35 fighter jets the air pofor and navy will buy. that's reportedly expected to decline. wa among the names to watch all of those names largely under pressure ahead of these details today. we have seen a strong run since the start of the year outperforming the s&p. key question though, how the

pentagon will account for inflation and whether that top line increase can actually counter rapidly rising costs which, carl, is perhaps the reason why so many experts expect that lawmakers will ultimately boost this budget before the year is out. >> not to mention other governments like canada making comments now about northrop. interesting stuff. we are in different days no question about it. take a look at crypto rallying bitcoin above 48k. that's not only the going green for the year, but above the 200 day at moving average for the first time this year first time this year we are back in a moment. plus, zero-dollar commissions for online listed u.s. stocks. [ding] get e*trade and start trading today. - super excited to open up my diploma outherw hampshire university. [ding] get e*trade - i'm nervous, i'm excited.

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i'll get my onesies®. ♪ “baby one more time” by britney spears ♪ e*trade now from morgan stanley. welcome back the house is set to vote on a federal marijuana legalization bill in the coming days. tilray jumping 20% in each of the last two sessions, but this morning the sector is largely lower and despite the gains to end last week, many cannabis names down 50% the last 12

months join us, ceo of the green thumb industries, operating 17 marijuana manufacturing facilities across the country and has a retail presence in 15 markets. thanks for the time today. >> hello, thanks for having me. >> the prospect of a bill at least in the house got a lot of people excited but it was inevitably met with the response where does it land in the senate. do you have expectations of this going anywhere >> well, i think it's important to zoom out and see what's going on a lot of misconception of what is happening in america, canada. i think it's clear change is coming to america. americans want change. opioids are killing people alcohol is killing people. how that's going exactly happen at the federal level is unclear. what is clear is the federal government is a trailing indicator and on the ground in america where u.s. operators have a -- around their business, there is a monstrous opportunity. you mentioned tilray, it's really irrelevant in the u.s.

right now with consumer products and the end of prohibition. >> right do you think it matters, necessarily, what federal law looks like do we have enough momentum and are we at a tipping point on a state level where that can be enough >> what's happening at the state level has already tipped so in 2021, you had connecticut, new york, new jersey and virginia all legalize. none of which day one has occurred new jersey big state, you guys are very often, day one of prohibition ending is going to come in the next 60 or 90 days we are excited for that. what happens in d.c. again is a little bit irrelevant. what is important in the country is how we set up the industry, who is a participant and where the new wealth is going to be created and who takes part in that >> all right so it is important what is going to happen if you finally get what you have been hoping for, for years now, in terms of legalization federally? >> well, i mean, monstrous

upside optionality, right? accessible so for investors we think the equity prices go up effectively. what's important is access to capital and people participate inning in the -- black and brown people, 40,000 people in jail. as things progress, what we have been hoping for is to get people out of jail. there is a lot that has to happen it's not an easy pass. >> so, ben, it's morgan. if we see decriminalizing on the federal level, does that help to counter or even potentially stamp out the black market which has continued to be a formidable competitor, at least in certain states, because of the regulations and because of the taxes and because of the limitations on the legal market that we have seen? >> yeah, i think those are somewhat disconnected. legal market in 25 billion on its way to -- federal

decriminalization, 4,000 of those people are federal prisoners. the president, you know, get them out of jail the federal decriminalization, get them out of jail that or moanother motion and then who creates wealth in the industry is important. that should happen at the state level. we are seeing difficulty in illinois, hopefully, new jersey, new york, connecticut will be a role model for what happens going forward. >> separate from whatever may happen with law, how would you grade the industry in learning lessons, getting better, efficiencies at pricing and inventory and licensing, even with all the handcuffs around banking, for example, are we getting to a point where they can -- once it's legal in a state, run better than they did before >> 100%. but i think you say the industry i think there is massive misconception on the industry. the canadian cannabis market is not the u.s. branded cannabis operations that are thriving, that are hiring people states need taxes.

they need jobs and we need employ people and create a new seconomic stimulus. more than two-thirds of the americans think recreational cannabis is a good thing there is plenty of opportunity americans are choosing cannabis for well being pretty awesome to watch. there is on-prem consumption experience here, et cetera big upside >> well, our eyes will be peeled on the hill next coming days, see if this moves, ben maybe we will talk later appreciate trjts thanks for having me. later today we will talk more tesla with morgue morgan stanley's head of auto research, adam jonas, who has been active in writing his notes about the industry at large the last few days that's at 11:00 a.m. that's at 11:00 a.m. we'll be right back. yep! every business deserves it...

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welcome back to "squawk on the street." the pandemic led to a few realignments in the labor force from reassessment to resignation and now organization our kate rogers has that story and shy joe joins me here. so great to have you on set. >> great to be here. high-profile union drives and

strikes underway from starbucks to rei and amazon where votes are being cast and counted at company warehouses in alabama and new york workers are designing so use their power to push for better pay and working conditions several of the drives are being driven by young people starbucks workers united says the charge is led by baristas in their 20s. some workers tell me this push is important, even though though don't plan to stay in the job forever. the challenge is twofold restaurants in particular. workers tend not to stay in these jobs long enough to see some of these fights and contract negotiations through and getting an actual contract can be a challenge as companies have to bargain in good far-right but agreeing to that contract is a different story. for companies it's a delicate dance between keeping shareholders and workers happy >> i think that the calculus that a company has to make on this, in this context, where you could be more aggressive, increase the probability of

winning the election, and damage your brands, how do you think about that if all you're thinking about is keeping the shareholders happy it's not an easy needle to thread there, right, because the more aggressive you are, the more likely you're probably going to win. >> in 2021 the union membership rate was down. in 2020, it was due in part to a decrease in non-eun one workers tied to the pandemic in the public sector the rate is five times higher than the private sector at 34.9% versus 6.1%. when you look at the actual numbers, particularly for restaurants retail private sector, very, very low. >> which has been the counterargument to the risks that are being seen and some economists are talking about where a wage price spiral could be concerned i'm curious though when you are talking about a starbucks or amazon, mine, how many people

are voting to unionize i imagine it looks different across the different businesses when you take into account churn? >> like we said, some can have high turnover. i talked to organizener for amazon and he said there is 6,000 votes that are expected to be cast which is huge. so that count will take all week some of these starbucks hearings are done in 30 or 40 minutes starbucks hometown of seattle that unionized, a big one for the union, had nine workers. they voted unanimously to unionize but it was nine smaller footprint, smaller amount of workers, potentially easier to get everyone on the same page this the stores. it's ved ing across the country quickly. it's important to keep in mind how many people are voting and that's something i think investors are watching. >> it's important context. if some of the employees are not expecting to be there by the time their unionization efforts m manifest, why are they doing >> it's interesting. in talking to young workers at

these companies, it seems like there is a collective group think improving things and making things better for everyone, not just yourself and your current position, but years dom. if you get a good contract and the union can hang on to it, if that worker decides to move on, that's good for everyone the younger work edayers are thinking about everyone else >> it's very fascinating you have been covering this story closely for a while. glaet to have you on set. well, now let's get over to dom chu. >> stocks are mixed at this hour we are tracking particular weakness in certain parts of the market and some sectors in particular more vulnerable to the volatility in the commodity complex including energy and materials, metals, that sort of thing. within the energy trade, halburton and apa corporation, baker hughes are firmly in negative territory as oil prices slide today. that comes as the oil prices

drop on demand concerns related to the stricter covid lockdowns happening around shanghai, china. over in the materials side of things, the metal and mining companies like freeport mack moran, new core, steel side of things, among the worst performers, fertilizer players that saw a lot of strength recently alongside fertilizer stocks. if you watch some of the names, veep an eye on some of the rersals we may be seeing keep it right here we will be back after the break.

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i am here. we are going to continue to bring the old company back, but, yes, i think we are going to be doing interesting, exciting things to grow, to transform amc, to find attractive investment opportunities to make sure that we do grow into that valuation that's out there >> that was the amc ceo. you can see amc is having a very strong run reiterating the company would do what he calls

more transformational deals in the gold and mine silver operator minecroft he believes this is a core competence of amc, not just running movie theaters, but using its army of eights to provide capital to companies he identifies may be capital stars but with that new capital can quickly change their fortunes. he says that is is the case with highcroft. and they seem to buy it. >> it is the spread of the meme theme, if you will the shares are up 18% right now. satellite as a service company is competing with its acquisition. listening this morning, the company which counts nasa as customers among others has seen

it's geopolitical in demand. congrats on going public today i want to get into the specifics of the company but from a geopolitical standpoint, what we are seeing with russia's inv invasion of ukraine. given satellite consolation -- constellations, how are you positioned in that >> unfortunately, the tragedy in europe has brought a lot of attention of what we do for customers. we build solutions both day and night. we have been providing ukraine with information to help save civilian lives, imaging what is going on in realtime data and we are seeing interest from both

the commercial and military sectors, for things like radar where we can image the earth at night or when it's cloudy out. >> how do you keep those assets safe in space. i have had conversations with the space force and air force more broadly about the role that can be played in that. >> there is talk about the targets. we are in lower targets, so we are about 2.5 times faster than a hypersonic missile and we build them in quantity, so if one goes down, we have many more to take its place. >> biden is expected to have the 2023 budget in a while the expectation is increased

defense spending as well as civil space spending what are you looking for and what kind of opportunity does that mean for you? >> we are building the communication of the future. we are seeing opportunities across the board through the dod and ic community of all kinds of payloads we build everything from orbital to infrared, whatever the customer requires, we help solve the problems with space. with this new budget we see opportunities to provide more assets in space to keep our nation safe. >> a question on the balance sheet. in october there was $345 million in cash and trust in tail wind 2. but you only took in $294

million. so you start life with cash on hand of 100 million but debt of $175 million is that as a result of the fact that the necessary money you needed had to come in the form of debt because redemptions were so high? >> we also had a $51 million pipe so we took in about $80 million in the company and we wanted access to the market going forward as we build more factories. we have gone from 50,000 square feet of space to a quarter million of square feet in florida we will be building the world's largest satellite assembly facility. with florida putting up $300,000 of that. >> are you starting life with more debt than anticipated and does that hinder your ability to

grow >> not at all. if we tried to do an ipo, it wouldn't have happened, so we made a conscious decision to use a spac we are highly confident about our position going forward we have hit over $200 million of backlog that we are building. >> are you still on track to be profitable on an ebidas basis? >> we are working for that goal. >> live long and prosper, which is the greeting for vulcan we appreciate you. it is a quiet start to the week with the s&p just barely positive the nasdaq is the outperformer

as tech stocks move higher >> with that we will end our show and move over to "tech check" which starts now. ♪ happy monday welcome. today tesla tears higher with shares back up $1,000 a share with talk of a potential stock split. plus, the slap felt around the world. what picture win could mean for streamers and social media's growing role finally, the risk in focus with the conflict in ukraine we will talk with the ceo of