good morning recession warning in the markets. yield on the two-year and ten-year treasuries inverted in the past, that forecast five of the previous two recessions we'll tell you how to protect your money. gamestop plans a stock split. details straight ahead. u.s. authorities investigating a meeting with activision ceo and alexander von fuerstenberg placed an options on the stock before it sells.

it's jobs friday be prepared for april fools jokes. it's april 1 "squawk box" begins right now. good morning welcome to "squawk box" here on cnbc live from the nasdaq market site in times square. i'm rebecca quick along with with joe kernen and andrew ross sorkin let's look at u.s. equity futures on april fools day dow futures indicated up 227 points nas daq up 113 this comes after a down day. major averages down 1.5% on just about every count. that is the perfect for the end of the quarter the worst quarter we have seen in two years going back to the beginning of the pandemic. the dow was down 4.5%.

4.9% decline for the s&p down 1.9% for the nasdaq the worst performers were three companies that surged in stay-at-home etsy and paypal and netflix. occidental and marathon are gaining. crude oil prices are back below $100 a barrel. this comes after president biden announced the plans to tap the oil reserves we will have more on that in a few minutes. wti is $134. andrew thank you. the market is getting a sign the recession is on the horizon. that is what everybody is talking about. yield curve inverting after the closing bell the 30-year at 2.5% of

2-year at $2.39. let's talk to steve liesman this morning. >> andrew, yeah. let's do the background. flirting with the zero line earlier this week and giving off a false negative the spread officially inverted yesterday. that is it went below zero with the longer dated yield was belo the shorter. some some thought it meant recession. others thought it meant nothing. it now stands 0.15% of the spread blink your eyes and it could be negative this is a concern because the markets think the fed will raise

rates too high and too quickly prompting recession and prompting an easing. the trouble is recessions follow inversions from six months to two years later. start your clocks now. krishna guha wrote wethink the fed will not ignore the 2/10 spread, but should not and will not be overly influenced by the mild inversion on this particular metric. the fed focuses on a different spread the three month and two-year bond it is positive at the moment almost like the u.s. in the middle of the expansion. it reflects the fed rate hikes the next 18 months this spread inverts five months closer to recession of 2/10 or 11 months. we will get a read at 8:30 this morning. the expectation is the job

growth is expected to continue to be strong an andrew >> the second metric which you suggested. a lagging indicator, but not as early as an indicator. is there any time in history where there's been an inversion and we haven't had recession how many examples are there of recession? how many without >> so, the 2/10 is -- depends on how far you want to go back. i have it from 1980. it is 5 for 5. hold on. i'll count it. the 3-month and 2-year gave a false signal it is actually 6 for 6 on the 2/10 it turns -- by the way, it tends to turn negative yesterday was 442 for five minutes. the 2/10 is really 5 for 5 i guess one false signal in the

middle of the '90s 3 month/2 year, is closer to recession. one false positive i hate talking like it like covid. >> 5 is 6. >> unless it is 5 for 6? >> it depends how you measure the '95. >> steve, i'm trying to figure out. >> yes, it can, joe. if i can be more precise >> three more pandemics and couple more world wars we won't remember. >> cincinnati can win the super bowl and rutgers to win the ncaa title in all that time >> hey, hey. >> time violation doesn't apply to the bengals >> here is what is interesting to be clear on the 5 for 6 i don't know

maybe we were headed to recession without covid. it did go negative several months before covid hit and that brief recession that is chronicled in the record here. i guess i'm skeptical, guys. i'm skeptical. for what it's worth, some fundamental thing out there to derive spreads up to 23 months, joe, is the longest that gives the false positive >> we don't know which rates mean anything necessianymore. >> that's a great point. >> premise is short-term rates are going up because fed will hike rates long-term rates are not going up as quickly or going down because of the aftereffects. you worry about the soft landing and if the fed can pull that off. i don't know you can set your

watch on this. >> the logic at looking at -- >> support resistance and all of the normal things you look at. katie stockton she would monitor those and give more weight. that's like a lot of people whis w whistling past the graveyard none of us want recession. maybe 5 of 6 is pretty good. >> the other thing we mentioned is a recession is not necessarily the recession you are thinking of from the great recession or anything like that. it means two quarters in a row >> i don't know if it means that anymore. they have different mentanings. >> it never meant that no, the recession is not two

quarters they look at all of the different indicators everybody thinks they have the official definition. >> i thought that was. negative gdp for two quarters, that is not a recession? >> becky, i think you think i'm pedantic do to the web site >> are the only ones to declare it >> that's it that's it. national bureau of economic research headed by -- >> yeah. >> and what is worthwhile talking about it they mostly do it for academic reasons. not academic as not meaningful they do it so we can go back and look at what happened to it in a recession and what happened leading up to the recession. we do back and study the economy. they don't do it for us. they did it for us, they would

meet every day and give a ruling every day. that's what investors want to know one more thing on the 3-month/2-year what makes sense is that is the timeframe we are talking about talking about recession three or four years from now is mea meani meaningless. right now, traders are trying to figure out what's going to happen two years from now and what is happening three months from now that spread to me is the reason why economists think it provides more information it is within the timeframe >> that's a great line if you sneeze, it doesn't mean you have a cold. if you have a cold, you will probably sneeze. >> yeah. are you making the santelli book >> we should listen a lot. midwestern wisdom, i think >> thanks, steve

in the meantime, activision blizzard and ceo and media moguls are under scrutiny. authorities are looking into the meeting with bobby codek and bobby von feurstenberg and barry diller he wrote we have zero knowledge of the transaction and if we did, we would have pursued it is unlikely to believe the professional and with breakfast with he and his wife would have told them of the pending transaction. he said it was a coincidence i did not wait until i was 80 to participate in such a fraud now they are looking into the bid to buy activision blizzard

elizabeth warren and bernie sanders and cory booker and sheldon whitehouse are asking about the request. the lawmakers say this could hurt efforts to hold management accountablediscrimination. >> we talked so long about the inflation, my story got killed they had the chart up. gamestop has nothing to do with the activision microsoft deal. they killed that, but not the stack. >> andrew, were you saying something? i don't think your mic's on. >> no. i happen to believe barry diller and alex and david i was going to say in the context of gamestop. if the s.e.c. started to investigate all of the trading done during that period.

i don't know what they would find >> separate issue? nothing with microsoft or activision >> totally separate. i think there is just as much if not more quote/unquote, u suspicious trading activity. >> it goes back to reddit. we had those discussions 18 monthsi ago >> did they have inside information on reddit? >> just because you are ganging up and saying we are going to do this >> i have no idea what went on at that lunch. >> breakfast >> breakfast social breakfast what if you know they are talking and they say act sivisi a year from now. we will see if it is okay. is there body language or anything that would indicate someone surmise something is going on and figure it out >> if you looked the chart,

heading into that -- >> it was already headed up? >> if you looked at the stock down and not unreasonable something would happen the stock lost so much value take a longer term chart if you look at that slide and dip, it would not be crazy to think this is a great property and it would shock me to think not somebody to step in or try to do something. that is not a crazy assssassumpn >> it looks weird. >> when barry says that, i believe him. when barry says that, okay i have known barry long enough i don't think he will lie about that i don't think he will do something crazy or stupid. >> he would have to be crazy no doubt what would they look at now, sorkin i, myself, have never heard the term burner phone. what if they were using burner

phones what would the s.e.c. look at? emails everything >> one of the things that is happening is barry and david and alex are turning overall of their, i believe, emails and texts and the like barry has been public and says he believes all of that basically will show the story in a clear way that this was an idea, i believe, that originally emanated or the narrative is it emanated from david geffen of a takeover target or a company taken private. that was a rumor that was in the ethos. that was a rumor that it is something that would happen. they will place that against the meal i imagine if everybody at the meal testifies that nothing was said at the meal, then i think it becomes a harder case the other piece of this and it

raises suspicion this is a question i thought about for a long time. you know, private investors meet with ceos all the time at conferences and all sorts of events we created this system where there's supposed to be fair disclosure across the board. should there be blackout periods? i can't tell you how many times people go to an event and meets with somebody and a day later, they like the meeting. >> this wasn't a meeting this was a social setting. is a blackout period, you can't meet with anybody who is a potential investor that is insane >> the point is you avoid -- to the extent you are anxious or nervous about optics and want a system that everybody believes is credible. not believes is based on insiders or friends talking. >> i think that is impossible to

police by the way, if you need to do that when you know there is a transaction there, you shutdown your social schedule, that would be a bigger hint i'll not meet you for dinner on friday night that would be -- what is it? do you have covid or are you about to get bought? >> you are raising interesting issues, becky. i don't know if it is incumbent upon the ceo to shutdown what they are doing or incumbent upon the friend to say i was at a meal with so-and-so. if i buy their stock, someone may raise questions. these are the sort of broader questions. obviously not specific to this particular incident. >> i was at some fancy place in l.a. do you know which restaurant it was? i remember the great steve martin where you are being interviewed and if you are

allowed to eat what are you going to order? the duck no, no, no no, no chicken. do you know what restaurant it was? some cool place, andrew? >> i don't know. >> i figured you would have the -- i'm sure tmz knows. coming up, crude prices are back near $100 per barrel after president biden announced the u.s. will tap the oil reserve and china lockdowns. analysis next. and the jobs report. i just remembered the name of the restaurant le idiot >> from "the jerk" movie >> yes the economy added 490,000 jobs last month more predictions later in the show you are watching "squawk box" on cnbc

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president biden again tapping the exstrategic petrole reserve in an effort to ease at pain at the pump price of crude$100 brian sullivan joins us now. it will be troubling if prices continue to go up. brian, i know we do things in six-month periods. the election is in november.

why not say it >> if you do the six-month match, it takes a few weeks or a month to get the oil started to go out all that late april and may and june and july and august and september and late october so the timing there could be random i have no idea i'll not say it. you know, time gingtiming. joe, let's be clear. any political party. whatever the ones are now. they will change over time probably do it because the biden administration is doing something. let's hit oil. oil is down right now. do go ahead >> it is intended to be there for a horrific moment. we should repeal the gas tax instead ofusing 35% of our

stockpile. >> yeah. 70 cents of gas tax in pennsylvania that in california is an easy weapon any way, let's discuss oil is down. spr release. joe, i'm talking to people all night. yesterday was a long day people in china with the lockdowns think the prices are down the spr release has something to do with it shanghai is locked down. eunice yoon said entire buildings are locked down because of one covid case and people's pets are taken away and killed if the human tests positive they are in a disaster on the spr release, wall street chiming in overnight some think it could mitigate further price hikes. nothing i read suggest prices will fall. evercore out with the release of

akin to beating a dead horse rbc saying people will buy the dips and long-termo outlook undetermined what about this? the president unveiling the release and talking about the 9,000 unused permits that is getting attention. a couple of things to throw out there. whatever you think 100,000 wells operating on federal land most in 20 years federal land utilization has never been higher in two decades. i heard from a lot of private oil operators yesterday on the twitter or text or email there is a backlog of 130 permits at bureau of land management because they are sitting on a desk. they want to raise production. if they can find the workers and frack and steel casing which is all hard to find and very expensive, they may not be able

goa to get permitted or they have the permits or they are getting sued and can't act on the permits. you hear the story it is not like i got the land. i i'll go drill. i cannot take down a tree in my yard in new jersey without a permit the president wants to do 1 million barrels a day. technically, the four salt domes can do 1.1 million barrels each. here's the thing the most we have ever withdrawn is 864,000 barrels a day going back to 1985 these are old facilities you are asking your 1987 hyundai to do 185 miles an hour for a period of time there is a concern if you crank

out 1 million a day, is there a risk of environmental accident these are old facilities i'll go to one soon in louisiana and report live, maybe i'm putting that out there >> offshore, brian close? >> salt kcaves. literally caves. they are filled with oil salt domes domes in caves we have never taken out more than 860,000 barrels a day nothi nobody knows if we he can get it to market. you have pipeline and trucking issues once you take it out of the ground, the buyer is responsible for getting it to market i heard from oil companies they will tell me what they want me to say. i get that i'm in touch with them this is their point of view in some ways. they are not sure they can get

that oil to market if they can, it should make a dent by the way, we still have russian oil on the way joe, the last russian shipments. we thought they were two weeks ago. 17 ships on the way to america filled to the brim with russian oil because they were in under the 45-day window. >> who knows i wonder what the price per gallon peaks >> refineries are at 92% capacity right now, joe. that is not the max, but close to it. >> before the summer i don't know >> summer driving season known as summer. >> $5. i don't like those lines you know people start pulling pieces out. get out. crazy stuff happens when you are desperate for gas. >> i watched fist fights in 1980

at my dad's station. people would get into fist fights they were rationed or you had to show up with a certain license plate. >> la habra. >> i used to go to a coven meeting. >> thanks, i won't talk about it. >> scary guy joe, you get your big moment after this commercial break to talk about your favorite topic gamestop announcing plans for the stock split. shares jumping as we he speak. we will inbrg you the details, joe will bring you the details since this is his store when we c come back. >> announcer: this cnbc program is sponsor by charles schwab

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shares of gamestop are soaring. they will seek shareholder approval to increase the number of shares to enable a stock split. the request would increase the shares from 300 million to 1 billion. it is not clear how much of the increase share count would be used for the split gamestop said the share increase could be used to provide flexibility for future corporate needs. andrew, we have been talking about it the reason it is my story is because i was slated to read it. it got moved >> i know. you have don't have a deep rooted interest in this story? >> no, what is interesting is

most people would say that makes no sense for a stock to go up that much on a stock split nothing changes. compared to what used to make gamestop go up this is the most fundamental reason the company had to go up. i guess it it should be up 50% probably you know what i mean why did it used to go up, sorkin >> you know i'm fascinated i don't have anything to say because the whole thing doesn't make sense to me anymore >> right >> it stopped making sense to me a year ago i'm not going to win points with our audience a lot of people are very happy. >> am i @joesquawk that's why i can never leave it would fall by the wayside what would i do without twitter? when we come back, recession warning in the yield curve we dig into yesterday's

inversion although it was so brief. we will talk about what it might be signaling for the economy as we head to break. a look at s&p 500 winners and losers >> announcer: executive edge is sponsored by at&t business at&t 5g is fast, reliable and secure but all my employees need something different. oh, we can help with that. okay, imagine this. your mover, rob, he's on the scene and needs a plan with a mobile hotspot. we cut to downtown, your sales rep lisa has to send some files, like asap! so basically i can pick the right plan for each employee. yeah i should've just led with that. with at&t business. you can pick the best plan for each employee and get the best deals on every smart phone.

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it's been looming for weeks and it has happened. 2-year/10-year inverted for the first time since 2019. joining us is michelle girard. head of net west markets and dana at invest let's talk about this, ladies. dana, i want to go to you first. we had a lousy first quarter the returns are likely to continue for the year when it comes to equity markets. why is that because of the situation? >> we are looking at lack luster returns this year. predictions on returns are notoriously difficult. i think the economy is in a strong place

we have a strong job market. corporate properties are doing well we have liquidity in the market. it is not so much i think we are necessarily going into recession, notwithstanding the inversion of the 2/10. i'll say a quick point on that it has been a strong indicator as market indicators go. we are talking about a lag from six months to three years when recessions show up after inversion. you have to take it with a grain of salt. with that said, you should prepare for markets being a little more lack luster. certainly than last year where we were having fantastic returns. considering the volatility we're dealing with midterm and geopolitical crisis and china lockdowns, et cetera >> michelle, what is your take on the economy right now everybody we ask say things are blistering hot jobs market.

strong tax receipts with the issues companies still posting strong results. the idea of recession may be out there. it is hard to think it is here any time soon. >> certainly right now, the economy has shown good momentum. although, i fear going forward we may see some softer news. i actually think in the market fears of recession are going to start to move to the floor we have the short-term inversion of the 2/10. i like to look at the broader yield curve. that has been more reliable. that is far from inverting we will see deceleration with the data starting with the payroll report this morning. we have a negative gdp purely because of the big inventory drawdown nonet nonetheless, it is concerning and the market is expecting a

lot of fed tightening. i think people are going to become worried in order to really break the back of inflation, the fed is going to have to take rates into restrictive territory and might have to suffer or allow a mild down turn in order to get inflation in check that worry will move to the floor in the next couple months. >> michelle, what do you expect with the jobs report today why do you anticipate softness it seems employers are hiring just about every worker they can find >> that's a real key becky, the workers they can find that has dogged us all along we noted the fact the softer job gains is more a symptom of supply than demand last month, we saw weakening in the survey data. we saw evidence that hiring was a little bit less robust in the last month, we have seen a tightening of financial conditions as a result of the

invasion of ukraine. we havehave worries of the fed raising interest rates it may have all come together after a string of incredibly strong job results we are looking at a gain of 200,000. >> dana, what do you tell investors to do in the environment? it is tricky we have seen areas like energy do well with huge gains. is it time to jump into that market or is there something else you like better >> it is great question. the obvious is make sure you are long on the risk tolerance if you are fearful the market, you don't want to be overallocated in if equities one place to look is defensive areas. a couple of ways to look at defensive. technical indicators with volatility and looking for stocks with low standard deviation. if you go that route, you look for a vehicle that looks at

minimal volatility those types of instruments will be concerned with tracking market and not having over weight to utilities which tend to be low volatility you don't want to overweight volatilities it will keep you within a certain amount of market allocation sectors another way is quality fundamental indicators high profitability companies companies with a good credit rating companies with cash. those provide balance in the equity portfolio. >> dana and michelle good to see both of you. coming up, new details on the probe of activision blizzard and three high profile investors who placed bets ahead of the

microsoft acquisition. harvey pitt will weigh in on that coming up. we like to remind you to watch or listen to ulis ve anytime on the cnbc app. careful now. - thanks. -you got it. and thanks to voya, i'm confident about my future. -oh dad, the twins are now... -vegan. i know. i got 'em some of those plant burgers. -nice. -yeah. voya provides guidance for the right investments, and helps me be prepared for unexpected events. they make me feel like i've got it all under control. [crowd cheers] because i do. okay, that was awesome. voya. be confident to and through retirement. ♪ ♪

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box. cease-fire talks continue for ukraine and russia and gaz prem is continuing to supply gas european governments rejected that demand to have gas payments in rubles. they appear to have found a work around ukraine has retain two villages along one of the main supplier routes between kyiv and norther part of the country. russia has continued to bombard kyiv with air and missile strikes. the story continues. i don't know i think it is getting better, joe. a little bit >> then i can't help myself. the irony of this. russian forces transferred the control of chernobyl, the nuclear power plant, back to ukraine. the ukrainian authorities according to theinternational atomic energy agency

a five-week occupation of the defunct plant. russian troops forced ukrainians to work at a gun point for months without a shift change and workers said they took more than 100 ukrainian national guard members away in trucks as prisoners of war all of the reactors have been shutdown since 2000. you have to employ the staff to keep the spent fuel rods cool by pooling water over them. why don't you? no, no, no ukrainians are like, no, you keep it. >> destroying everything in the area. >> is that the asset you want to acquire? >> you don't want to transfer that back and forth with guns. >> you know what take her she's mine >> in is one of the concerning things that has implications far

beyond the borders of ukraine and iaea has been concerned. >> that's whethere you go to wo every day? >> isn't this a great sign isn't this -- to me he, this is sign -- if they thought they were winning and taking over the country, they would be taking control, right >> right >> i can't believe they let the sailors go that said we're coming on. they said go -- remember they released those guys. >> i think andrew is right the idea a pull back happening here. >> they have retain parts of kyiv and things happening across the border, too. the war, theater of the war is beyond just ukraine. i don't think moscow didn't bargain for any of this.

>> yeah. >> chernobyl >> we will continue to talk about it we have more coming up covid cases in the northeast we will shift course and come back domestically. they are back on the rise due to the spread of the ba.2 as contie 'lta autlock downs wel lkbo that in just a moment when squawk returns yeah...uhhh... doug? [children laughing] sorry about that. umm...what...it's uhh... you alright? [loud exhale] [ding] never settle with power e*trade. it has powerful, easy-to-use tools to help you find opportunities, 24/7 support when you need answers, plus some of the lowest options in futures contract prices around. [ding] get e*trade and start trading today.

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welcome back to "squawk box. china's biggest covid lock down in two years and under way in shanghai with 16 million residents being tested joining us now is dr. scott gottlieb scott, the policy over there doesn't seem to be working the question is whether it's worse than we even know. >> i think it is worse than we know there's some reporting on "the

wall street journal" today where they're speculating there's a lot of deaths in those facilities the problem is china hasn't used the time they bought themselves over the last two years wisely in terms of getting a high percentage of their population vaccinated particularly a high percentage of their elderly population if you look at the city of shanghai itself only about half of the population over the age of 80 has been fully vaccinated. and if you look at the population as a whole there's 52 million people over the age of 65 inside china that haven't been vaccinated at all we do know the vaccines they deployed because they didn't use the western vaccines they used vaccines manufactured themselves based on inactivated virus, those vaccines have proven to not be as effective against this particular omicron variant. the vaccines they deploy aren't as effective at stopping the spread, so they do face more risk right now i think it's going to be hard to contain the virus in the city of shanghai and one final point remember

when you tell people to stay at home, you're not ending transmission what you're doing is forcing transmission into the homes. so their virus is still spreading. now it's spreading within those households where people are being confined together. >> i want to pivot the conversation and bring it back domestically big fight happening in washington you know over funding for covid. unclear where things are going to land at this point. how much money do you think we should be spending to get prepared and continue funding when we're not where we are. >> it looks like there's a compromise of over $10 billion and the continued procurement of the therapeutics as well as the small molecule drugs these markets can be transitioned to normal commercial distribution. they just can't be transitioned abruptly i think if congress wants to step back from funding the vaccine distribution in particular, they need to give a

signal to the market that's their inintention and give a time frame when they're going to do that the other challenge here some of these products are still under emergency use authorization. so they can't be procured by medical part "d" or by bart "b." so they need to be fully approve. and so some of that monoclonal antibodies, some of the vaccines for kids are still under emergency use authorization as well as the small molecule drugs. i think in time they can step back and get out of the business of buying and distributing these products they just need to articulate what the time frame is to do that, and fda does need to step in and fully approve these products at some point >> doctor, if the funding is half of what we're talking about now, what does it mean for testing? you've talked a lot about some of these drugs working best or even working only, you know, if you can get there early.

maybia need to often what does it mean for speed to market what the fall and winter ultimately look like >> yeah, look, the money that got cut. there's a speculation there's a compprise around $10 billion, there had been a request for $15 billion. a lot of the cuts that may get authorized is money that would have gone towards global distribution of vaccines but the bottom line is right now there are literally hundreds of millions of doses available for global distribution that aren't being pulled down by other countries because countries don't have the demand for vaccines they don't have the ability and distribution in place to make those vaccines available to that population so it's not a supply issue anymore and a global vaccine issue. it's more of on the grounds demand issue so the money that's not going to get appropriated probably have been used immediately anyway in terms of the longer term picture, the administration set forth in its budget and in its

plan for pandemic a provision where you continue to produce tests knowing you're going to have throw some away but they wanted to have a constant supply so they didn't have another shortage in case there was a spike in cases right around a period of time there was going to be a spike in demand like the holidays, like we had last christmas. what you don't want is some of these markets to respond to normal supply and demand signals where their demand goes down as it is right because cases are falling. some stop making less tests and as we go into the fall demand could stop again you don't have the testing available. >> hey, scott, i worry about that a little bit, just the idea we haven't learned from our mistakes and figured out how to manage this now two years ainto this and wondered how effective we are, how well we know the numbers at this point. i had covid a few weeks ago.

i tested at home my numbers never got picked up by thehealth department and i can't count how many people at this point that have had covid ifthat led the cdc to advise people over 50 to get that second booster shot. i'm surprised they advised people over age 50 when it was more than the vaccine makers were asking for and it was for younger ages than had been there before do they know something we don't? do they suspect we don't >> i don't know they necessarily know something we don't. i think there's much more infection right now than what we're picking up i wouldn't be surprised if ascertainment at the best point in this pandemic we were maybe picking up 1 in 3 cases we're picking up far less because most people are developing mild disease. and if they're testing at all

they're testing at home and they see no need to get a confirmatory pcr test and plus you look at the at home tests are pretty good at picking up infection. there's more infection than what we're measuring. we're at eight cases per 100,000 people per day the one case going up is the northeast. so cases are picking up in terms of what we're measuring. they're not going up dramatically i think we expected a spike from b2 that spike isn't as dramatic as i would have predicted maybe three or four weeks ago. i think that's a good sign because the fiurther we get into the spring and summer we don't see that spike i think we're coming to the realization this vaccine provides against omicron, it's provide about six months of durable protection, and if you're a vulnerable american in

an environment of continuous infection, which is what we were in with the pandemic you want to stay continually protected if you're vulnerable to infection once we're out of the pandemic phase and i think we're getting out of itthis is going to become a seasonal virus. and a vaccine that protects you for six or eight months is probably going to be just fine remember the flu vaccine only provides about six months protection we don't think about that because the flu season lasts about six months, so the vaccine protects us through the season we don't worry about flu through the summertime we don't worry about flu in late spring i think covid is falling into that pattern now >> i hope so, too. we just had flu in your household and i've got to tell you that was worse than the covid. dr. gottlieb, thank you. good to see you as always. >> thanks a lot. it's just after 7:00 on the east coast and you are watching

"squawk box" on cnbc i'm becky quick along with joe kernen and andrew ross sorkin. it's a jobs friday today we're going to get a preview of the numbers in just a few minutes from steve liesman also got a panel of experts ready for instant analysis coming at 8:30 markets yesterday down by about 1.5% across the board, but this morning you've got a big bounce back with the dow futures up by 218 points, the nasdaq up about 106 points and the s&p >> i want to get straight over oo dom chu looking at this morning's premarket movers >> that move you're seeing in the futures indicating perhaps a bit of a more neutral stance given yesterday's sell-off and the big jobs number just in case something were to happen a lot of different catalysts here, but first of all in the premarket trade right now we're going to put the meme stocks in focus here because you kind of have to.

$192 and change per share. this is after the company an after the bell yesterday said they are going to ask shareholders for approval to increase the number of allowed shares or shares outstanding in the company. you've heard it before in tesla. this is precursor to what's being viewed by many as an eventual stock split for gamestop amc up about 4.5% as well in premarket trade. g gamestop driving lot of that action and we'll see if it sticks around. after riding an 11-day winning streak there was almost historic we've now seen a two-day losing streak and just about a fractional gain on the premarket. this morning some traders and investors will be looking towards analysts at jp morgan who have now taken apple off their analyst focus list in terms of computer networking and hardware companies they still maintain an

overweight rating and $210 price target but they're going to look for more clarity with not just in regard to consumer spending and then possible moderating business commercial spending down the line, so a lot of that driving it, but still birated if you will there chinese intersunset stocks a big focus this morning for a lot of traders and investors because we're seeing the four biggest chinese internet stocks listed in the u.s. within the nasdaq 100 all up very large between 5 and 12%. this is the reason why reports over at bloomberg say that chinese regulators may be considering giving full access to company audits over here in the u.s. for those u.s. listed chinese companies. that's driving a bit of that optimism of course all those reports are citing sources familiar not authorized to speak publicly, nonetheless subscribing sentiment. i will point out because we love

doing this on this show and network, over the last couple of years these chinese internet stocks have taken a massive beating. if you take a look at the two-year chart that tracks many ofthese internet names from th highs we saw back in 2021 we're still down roughly 73% off those highs. so, again, chinese internet big surge today. we'll see whether or not it shifts the momentum over there for that most decidedly downward trend iptn those stocks >> we're going to keep our eyes on those chinese stocks and apple. less than 90 minutes now from the release of the march employment report and steve liesman rejoins us now with a preview. hi, steve. >> good morning, joe despite the surge in oil prices and other inflation and fed raising rates and economic uncertainty around the war in ukraine, wall street still looking for yet another strong jobs report that would maintain

average monthly job growth we're looking for 4 # 0,000. unemployment rate dipping down to 3.7%. that would be a nearly 50-year low. one of the three lowest by 50 years. average hourly wages a strong 0.4% a rebound in hospitality we saw that in high frequency data concerns of course by the federal reserve about wage push inflation. wages go up, prices go up. prices go up, wages go up. and we're looking for labor force returning. labor force participation increase over time as the strong demand for workers draws people back into the labor force. worth pointing out despite the robust forecast from the street high frequency data is a bit soft and one economist says it's enough to make him think there could be no job growth in march at all that's the underside of the story, and that would surprise a lot of folks, but maybe the fed

would be quietly pleased at that as it would take some pressure off wages and eventually inflation, joe that's what we're looking for. >> all right, steve, we'll be talking about it and watching for it and once it comes out, get ready. and try to do it really fast, steve. i want you to like write down everything -- get all your thoughts all in order and squared away for the most salient -- you've done that already i assume you usually do, right? you know exactly what you're looking for. >> i know what i'm looking for i don't know what it's going t say, though. you've got to adjust with what the data is. one good thing and i know the music is playing, no one has a good beat on what's going on in fact everyone has done a really lousy job at forecasting so any number would not really surprise me. >> i think what michelle gerard said is interesting. it's a supply issue at this point not the demand, right?

>> and you could have a lousy number three months later they come back and revise it and it's a great number like they did with november. >> right >> thanks, steve coming up, president biden announcing an unprecedented release of oil from u.s. reserves and a push to lower oil prices we'll talk more about that push and the plan to achieve energy independence at the same time we transition plus those march job numbers due at 8:30. we'll bring youthe report and the action when it hits. stay tuned "squawk box" will be right back. uh carl, are there different planning options in here? options? plans we can build on our own, or with help from a financial consultant? like schwab does. uhhh... could we adjust our plan... ...yeah, like if we buy a new house? mmmm... and our son just started working. oh! do you offer a complimentary retirement plan for him? as in free? just like schwab. schwab! look forward to planning with schwab.

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this is a wartime bridge to increase oil supply and so production ramps up later this year and it is by far the largest release of our national reserve in our history and will provide historic amount of supply for a historic amount of time. a six months bridge to the fall. and we'll use the revenue from selling the oil now to restock the strategic petroleum reserve when prices are lower. >> president biden yesterday announcing the release of a million barrels a day from the strategic oil ever are to help cut gas prices and fight thereflation joining us now is joe croft, ceo

of alliance resource partners. it's craft -- joe, sorry describe what alliance does. how much is coal how much is natural gas and oil at this point? >> we produce coal, second largest producer in the united states we also own significant oil and gas minerals we lease to the emp companies. our profits are probably 70, 80% -- >> the all in notion of supplying energy and energy independence, does it still include coal, and can you include coal does it need to be clean coal? is it still part of the equation because we've heard politicians running for president say i'm going to put the coal industry out of business completely so that's the backdrop you're

dealing with right now, isn't it >> that's great. and back in the '70s the nation turned to coal this time with the energy crisis you heard a lot about increasing oil and gas production you've heard about policies trying to ship natural gas or lng in europe. you don't hear anybody in the federal policy arena talk about coal, and that's a major mistake because coal is the one reliable resilient power source we have in this country, and we need to continue to depend on coal >> talk about the composition of the coal you do produce. how much of it is we do think of as clean coal? and would it make more sense to replace the coal being used now with natural gas or are we going to be using coal for years into the future >> specifically on whether it's clean coal or coal, all the coal we sell into the thermal plants

are going to plants that are totally compliant with all environmental laws today and i think one of the major misconceptions on emissions when you think about trying to replace a coal fired generator, what are you going to replace it with you're going to replace it with either renewables which require natural gas as a back up, so that's three different energy sources. what we're talking about is just protecting the fleet where power plants have already been invested in, now new investment, no new investment activity instead we've got an administration passing rules that are threatening 25% of our coal fleets in 2023. there's a specific regulation dealing with coal ash, which is basicallythe storage of a coal by-product after the power plant burns the coal to generate electricity. under the obama administration they passed a rule complying a

different technique to store that ash by 2023 unfortunately, the backup power has not been there to allow those coal plants to close so we have roughly 55 different powerplants currently trying to get an extension on that time line because they're really concerned about an energy security issue next year you're trying to replace that with not only new capacity for solar, wind and natural gas but also the infrastructure for that that means pipelines and transmission lines you can't convince me when you capture all the emissions from all three those industries plus transportation and pipeline they're greater than the existing power plants that are trying to close. >> and india and china, what we read, the anecdoteal evidence is coal usage, coal production storing, and how would you

characterize the regulatory constraints you have with coal versus what we think of with just natural gas and oil it must be much more prohibited for you trying to do business at this point, but is the rest of the world cranking out the coal and burning it for power >> yeah, there's no question china most recently chairman chie went to the coal producing regions and said we have no oil, we are depending on coal and we'll continue to rely on coal they will state they have zero emission or they want to make some dent in their emission policies but they've extended that to 2060 our country wants to talk about 2030 india, same thing. they want to grow their economy, take care of their people. they know coal is the lowest cost energy source to lift their people from poverty. so those two countries are going to continue to rely on coal and build a future for their people,

and they'll tine to do that even more if we move away from coal because we will be a higher cost competitor now, specifically to your question on regulations, our biggest problem is largely because when an administration says they want to put us out of business, guess who listens to that that's our banks our banks listen to that our customers listen to that, and therefore their policies speed up the demise, the lack of support for our industry so that they define a transition period that is totally inconsistent with what even the president says he wants to do in recognizing they need coal until 2035 to be able to meet the energy security needs of our country. so when you have a bank that says they're not going to lend to us because we're in the coal business because of discriminatory practices, that makes a far harder for us to compete and provide low cost stable energy to fuel our

economy. >> all right, it is complicated, and i can't imagine trying to -- hard for oil and gas companies for coal, that's almost a forgotten energy usage in the united states right now. but obviously if we didn't have it, i'm not sure it's -- we can replace it as quickly as people think we can and overall, you think the regulatory environment is affecting our ability to be independent, an independent country for energy >> no doubt about it if the president or the administration do not put a pause to the ccr regulations, we're going to see a serious issue in our country we're talking about enough electricity that would fuel both indiana and ohio you think about blacking out those two states because we shutdown 25% of our coal fleet next year. inflation and energy security are going to suffer. and you listen to what joe biden

said yesterday when he invoked the national production act to say we need more minerals because he doesn't want to depend on china. so we're moving away from one commodity source that has served this country well for the last 40 years and we're putting our fate in the hands of the chinese communist party. what did we learn from watching russia invade ukraine and see what that does where europe's put their fate in the hands of russia why are we going to put our fate in the hands of china? >> mr. craft, thank you. okay, coming up your corporate headlines. we're going to bring them to you. and then where have the ipos gone that is the question the number of companies going public falling off a cliff so far this year. before we head to a break let's get a check on the markets ahead of the march jobs data you're looking at the dow

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welcome back to "squawk box," everybody. in our headlines this morning we are a little over an hour away from the march jobs report economists are looking for 490,000 new nonfarm jobs for the month. the unemployment rate is expected to fall to 3.7% that would be down from february's 3.8%. the votes are still being counted at two union elections at amazon warehouses at this point workers in amazon's staten island warehouse are leaning in favor of union representation while employees at a warehouse in alabama appear to be set to vote that idea down for the second time. and lawmakers near a deal to approve $10 billion in new funding for efforts to battle covid-19 utah republican senator mitt romney who has helped lead the negotiations says that an agreement has been reached in principle. the money would be used to buy

vaccines, treatments and covid tests. when we come back, the number of companies going public falling off a cliff so far in 2022 just 17 companies have made their debut. we've got a break down of what's going on that's next. and later, the president's plan to tax the wealthy drawing skepticism on both sides of the aisle. we'll debate this issue of taxing unrealized gains. "squawk box" will be right back. time now for today's aflac trivia question. the new york biscuit company merged with the american biscuit company in 1898 to form what cookie company the answer whecn'ssqwkn bc "ua box" continues [shelf falling] the aflac pre-pain show. aflac! paul is about to suffer a shelf-inflicted injury. luckily, aflac will help cover his unexpected medical bills. aflac! maybe you could use the money to buy a step stool. i have a step stool. so why are you climbing a shelf?

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now the answer to today's aflac trivia question. the new york biscuit company merged with the american biscuit company in 1898 to form what cookie company the answer, nabisco. the first quarter has come to a close, and so far in 2022

the ipo pipeline has come to a near standstill. leslie picker joins us now with more hey, leslie. >> hey, joe. yeah, the ipo market has essentially fallen off a cliff so far this year just $2.4 billion worth of listings have hit u.s. exchanges in 2022. that's 5%, just 5% of the volume we saw last year over the same period that according to deal logic data in fact, this has been the worst three month stretch for ipos in 24 quarters since the beginning of 2016 when the prospect of rising interest rates ensnared broader markets. it's not too dissimilar to what's going on now. higher rates whipsawing and prauflts of growth companies that have come to epitomize the market in the last few years the renaissance ipo is more than 20% lower this year.

supply chains and inflation potentially creeping into margins of company looking to go public, debut. so companies that can wait to go public are choosing to do so set to make its debut earlier this year and has delayed. and reddit was planning ongoing public in march. well, that didn't happen it's april now digital bank chime is punting its deal to the second half of the year ins tucart and strike was considered candidates as well. but they just had their valuations slashed by fidelity the ipo market may remain at a standstill until something changes on the macro front >> the justice department and sec investigating trading in act vision blizzard. >> i heard a little bit more from this side of the issue about that brunch you guys were

talking about last hour. i'll just tell you what his spokesperson told me last night. quote, he had a social brunch with his friends at a popular restaurant he, of course, didn't share any information with them regarding a possible transaction with microsoft. so kind of making this sound like a social thing about friend of course as you guys were talking about this earlier who knows what was actually said or other signals could have been sent >> i think the real question at this point is there's going to be evidence going to be brought to bear in terms of either e-mails and other documentation. he believes that effectively exonerates them, explains the story as a coincidence, suggests that i believe that david geffen perhaps had a view as did others in the marketplace at the time

that either a buy out of the company or potentially a take private was possible of course, you know, whether there are -- i mean there's two issues when it comes to insider trader that are fascinating. you know, the tipper and the tipee -- typically for insider trading to happen in a meaningful way although i think there are examples in different context, what bobby codeck said or didn't say may in some way be irrelevant, or it could be relevant typically there's supposed to be some kind of transfer not just of information but effectively compensation for the information. so if you got some kind of sign or you thought you got a sign, what does that really mean, right? and i think this is the kind of thing we're going to learn a lot more about as this plays out >> yeah, and andrew, just also, they were looking at the same public data.

burkeshire hath away invested a ton. microsoft smelled blood in the water and realized they can get this really good company on the cheap because of all these problems so it's very possible these three men, you know, saw the same data that berkshire hath away saw, microsoft saw and said this is an opportunity, this is a target we know the gaming industry is going through a lot of mma and so they were already in the get go >> in terms of time line at this point what is the expectation how fast this either gets resolved or not? >> that's a good question because this is just a probe right now reporting so nothing too formal is going on, and at the same time there's two things happening right now with the act vision thing there's this issue, this probe we're talking about now and a

settlement earlier this week where activation made this $18 million fund where they can come forward and make their claim and be uh-uh warded from this fund at the same time some employees don't think that's enough, and they're filing separate lawsuits in fact, there are eight women i spoke with this week, and she's representing at least eight women in separate cases against the companies. so you really have codeck kind of getting it from two different sides with this sec probe and then these culture issues still plaguing the company and the lawsuits to follow >> hey, andrew, i'll ask you and steve both this really quickly, just the idea i was kind of playing off what you were suggesting if the onus is on bobby codeck necessarily in terms of information he would have given in that that means if that's the case if he's not in trouble for saying anything then the pressure would be really high on him. if they're going to come in and ask what happened, he'd have no reason to tell the absolute

truth because that would be the only reason that would get him in trouble if he testified -- >> why lie to these people, and that would get you in trouble even if you did nothing wrong on the insider trading front. absolutely, becky. >> steve, we're going to leave the conversation there we will continue to follow this saga as it unfolds appreciate it. >> thanks, guys. when we come back, president biden's proposed wealth tax causing controversy on both sides. we will debate that plan next. plus the march jobs report out in just under an hour. the futures ahead of the number looking pretty strong. dow futures indicated up by 200 points, nasdaq up by about 100 s&p tus fureup by 26 stay tuned you're watching "squawk box," and this is cnbc

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president biden's proposed tax on unrealized gains of wealthy americans has stirred some heated conversation on our own set and across the country joining us now is the senior policy analyst at the heritage foundation herman's center and also tobin marcus who's senior u.s. politics and policy strategist at evercore isi

this is startup debate on both sides of the aisle, going after unrealized gains but i think the people who are are more presenting a stronger case against this have to be on the right. so, preston, why don't we start with you what is it about going after unrealized gains you don't like? >> well, the fact is you're going after money, income that has not been earned yet. i think it's telling this administration in order to pay for all the goodies they want to have, they're effectively going after money that doesn't exist yet. so unrealized capital gains for most people if they have a house or a stock portfolio, if that gains in value in any one year, you're not going to be taxed on that until you sell that asset and that's not the way it works not only in the u.s. but economies around the world and ultimately if you start taxing unrealized capital gains it's very problematic because what you're doing is making it very hard for dollars to go to

the uses that they're most productive in. so that's what the economy is -- that's what finance is doing it's allowing investors to decide where they want to spend their money. and what is going to happen when we start taxing unrealized capital gains is that this whole system is going to break down because now instead of making a decision based off the best -- return on investment but we're going to start to make that decision based on that >> i think that's the biggest problem with this. this isn't even an income tax. there's going to be a battle in the courts so if you're serious at ways to get to tax wealthy americans this seems like a nonstarter the idea of taxing unrealized gains is a big stretch i'm not even sure -- in fact, i'm fairly certain democrats aren't even going to be able to convince all their senators to

vote for this. what do you say about it >> i agree it's not going to pass congress. just to clarify about the proposal, first of all, this is applying to income of people over $100 million in assets. so the case of an individual with a stock portfolio or someone with a single family home, i think those are pretty firmly out of the range here >> for now >> for now, sure >> the idea of taxing unrealized gains is a brand new one, it's something we've never been before and every tax that's ever been imposed eventually winds up hitting everybody. >> i think that's right. to the extent we're concerned about distortion, there is a pretty strong distortionary tact right now of the tax to hold gains for a very long time one of the things the administration is concerned about here is trying to actually, you know, unlock some of the capital being held for a really long time and i think they've been fairly thoughtful about putting in

exceptions for example vendors of companies to make sure the illiquidity of their ownings isn't forcing them to sellout earlier than they need to. i think it's a fairly thoughtful proposal i think it's clear there's no support from democrats to get through this congress and i think this is essentially an attempt by the biden administration to inject this idea into the conversation, to get debates like we're having going so we can work out when the kinks are, figure out whether this is viable long-term. >> the idea the administration want to unlock power and convince people not to hold assets over a long period of time, hold investments over a long period of time, i mean that's nuts because it's arguing against compound interest, which is the best way to build wealth. for the wealthiest investors no matter how you do it, if you want to grow wealth the best way to do it is over a long period

of time. and that is a thoughtful thing that goes all the way back to ben franklin >> there is a very real lock in effect you own a particular asset and you're very strongly incentivized from an arbitrary tax perspective not to realize the gains ontha that asset and idea of markets as an official allocating function does depend on people being able to move capital out of one investment and into another and the lock in effects i think are quite real so the idea is not that people would take their money out and put it under their mattress, but the idea is to unlock the assets held by these very high income individuals and allow them to put it into what they see is the most efficient use of capital going forward. >> hey, preston, i have a question for you which is i agree the idea of taxing unrealized gains seems to me very problematic and challenging. but i have a view which you may

disagree with, which is that some of on the progressive side of the democratic party have been pushed to this place, they're at this place in part because what i would describe as a basic loopholes and things like actually just capturing the taxes we currently have, which is meaning upgrading the irs, dealing with carried interest, dealing with things like the estate tax, dealing with things like the real estate tax, that those things which i think a lot of people think are actually quite rational, are not supported by you either. and so at some point it becomes an issue of how do you capture the tax revenue that clearly this country needs at some point anyway >> well, the fact is they're taxed at multiple levels if you're taxed -- the first tax on earned income and then if you invest gnat into a corporate tax

the corporation is going to be taxed, and then you're going to be taxed with capital gains. they want to raise the capital gains rate to the ordinary rates. and so now instead of just being taxed at the second level of taxation at a lower level, now we're talking about having a second level of taxation at the same high level than they'd be taxed on on ordinary income. the idea this investment income is somehow escaping taxation, the fact of the matter is it's all about taxation and triple taxation what we're looking for is a fair tax code that only taxes each dollar at once and that's where all these problems in the tax code is coming from the fact we're trying to get our dollars multiple times >> go ahead, andrew. >> go ahead, becky >> just this idea of whether this is, you know, a genuine effort or whether this is something that is really just politics, again back to this

idea of taxing unrealized gains is a nonstarter, it's not going to fly in the democratic party you're not going to pick up anybody on the other side of the aisle, why don't you do this on taxing over times. that's a conversation you might actually get somewhere it seems to me this is an easy way to rile people up, rile voters up because it sounds easy, pay their fair share you're not describing what's actually happening with some of these things is this a real effort or not >> biden is proposing to eliminate this to be clear and that's a proposal he carefully talks about. so that's still out there. you know, i do think there's some politics behind this. i think the common sense intuition not only do we need more in a common sense abstract way, people should be paying dollars at some point.

that's the voter intuition is saying that. i think in some ways -- >> the gaming of the systems, you have to die to make it happen so it's not a great way to have that doubt saying if you're borrowing against your share you're going to get taxed on that that makes sense if you wanted to just do the easy stuff, that seems like a much easier solution to go after. this seems either politics or a case of negotiation. i'm going to say some outrageous things so i can get the things i want on the side when we negotiate down >> i don't think that is taking place. although sinema did express some openness with a similar idea last year. i think this is mostly about politics it's about trying to put the idea out there, figure out if

it's viable, take the hits it's going to take with an eye towards maybe getting something lice enacted 4, 6, 10 years down the road there is certainly some poli political calculation. the immediate function of all of it is to put those ideas out there. >> tobin, preston, thank you very much. it's good to see you both. >> thanks. >> you get the calls about we'll cover all your funeral expenses? >> not yet >> i get those, and every time i ask the same thing now, do i have to die for this and they go, yeah, that's -- and i go, man. >> that does not sound fun coming up supply chain issues hitting auto sales. a preview what to expect from the nation's biggestauto maker when the numbers come out. that's next. and counting down to the march jobs report. katie stockton joins us with what investors can expect.

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this morning a lack of supply has the industry tapping the brakes. phil, good morning >> andrew, these will be ugly numbers when we hear from some of auto makers today we'll hear about first quarter numbers. there'll be a few march results in there it's tough for the auto makers mainly because of the supply chain that has been hit by the chip crisis. so here's the numbers that are expected march, 12.75 million might hit 13 million if we get lucky. last year 17.8 millionand in the first quarter it'll be down 15.2% versus last year the tight supply chain specifically when we're talking about semiconductor chips and the lack of supply, that's what's going to be hurting everything look, have you been to a dealership lately? this is what you see there's nothing on the lot, nothing in the showroom because the auto makers they're not able to replenish supply. they do not have enough of the key components in order to build

out the models in demand so when you take a look at the specific auto makers keep in mind ford announced yesterday it's going to be shutting down production at its flat rock, michigan plant next week that's where they build the mustang. why? a lack of semiconductor chips. and we're seeing this with other auto makers, too it's not just ford and as you take a look at general motors, toyota and tesla the q1 results you get from gm and toyota today, they're not going to be that great they've been able to manage the last quarter pretty well, and tesla will be getting the q1 delivery numbers likely tomorrow or sunday and most believe we're probably going to get in tomorrow we also get the ford numbers on monday first quarter, it's not looking good, guys remember when everyone said wait until 2022, yeah, we'll have all the auto production back for the makers, i think we're going to be waiting a while

>> handicap, it 24, 25, what ar we talking about >> in terms of when we get back to full production >> yeah. >> i think we get to full production likely by the middle of next year at the latest if not sooner most are pretty optimistic among the auto executives i talk with that by the end of this year they really should have ramped up production. having said that, andrew, if you asked me this back in september i would have said first quarter, second quarter things are going to be looking better it keeps getting pushed out every time we talk >> when do you think that prices will come back to some semblance of reality >> not for a while have you been out to look for a car lately they're not moving maybe on the lower end you might have some consumers on the lower end of the market who might be saying i can't afford this especially with high gas prices, but generally speaking right now we're not seeing the resistance.

>> and then there might be, by the way, by the time that happens there'll be used cars, fossil fuel cars and i imagine there's going to be a whole bunch of people just trying to buy evs, and therefore what are the value of those cars going to be >> that's a long way out andrew, we're a long ways from that happening i would say 24, 25 at the earliest we just have low production on evs right now. >> phil, thank you appreciate it. up next we're going to talk stocks and what investors can expect from today's jobs report with katie stockton of fair lead strategies and later reportedly under the mike scope of federal authorities over trades around act vision days before microsoft's deal by the company. we'll speak to former sec chair harvey pitt. "squawk box" will be right back.

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get ready to kick off trading in the second quarter, the futures right now indicated up 200 points on the dow first quarter was a rough one of for the markets. all three major averages posted their worst quarter since march of 2020 with the dow and s&p 500 losing nearly 5% each. the nasdaq, meanwhile, dropped more than 9% some insight on what the technicals are signaling for this quarter, let's bring in katie stockton, founder and managing partner we know we could put technical

analysts in a closed room, a cone of silence, and they just look at the numbers and decide what to do you know, ukraine notwithstanding, all these other things notwithstanding, but we've got to ask you about the inverted yield curve, katie. if it is a reliable predictor of a recession, you would want to factor that in what to do in the stock market because recessions aren't good. >> yeah, for sure. it is a reliable indicator of a recession. however, there's a major lead time, and that lead time can range anywhere from say six months to 33 months. and that's something we're somewhat uncomfortable with in terms of using it as an indication for it stock market at least in the near-term. in fact, if you look back at the five inversions before this one, the market actually rallied for several months in most cases so we have -- i'm not saying that that's causal, but we do have a market that's fairly

strong at this time in terms of momentum even as we come into this jobs report and if the jobs report have not been well received year to date here, but the market is a bit stronger this time around it does have better momentum to the up side. it's not to say we won't see recession, but i think more importantly what investors should focus on is momentum and make sure they're on the right side of the market but also managing risk. and they can do that by either being mindful of any overbought downturns or sell signals that arise or break downs we don't have breakdowns with the relief rally so that's a welcome development. >> so what type of additional percentage gains, and what type of time frame would you be looking at, if you assume that there is something to this signal in other words, do i really want to stay for the last "x" amount of gains for the market if it's

5, 10, 15 instead of 30 or 40% and if it's two, three, four, five months instead of a year and a half, are you confident it'll be that long and it fwans will be worth it to stick around if it's right the indicator. >> as a technical analyst it's really hard not to be more short-term and medium term focused because we're so close to the markets i think as it stands short-term there is enough up side to dictate staying with the market. last time we spoke we talked about maybe sell in may. we'd like to recommend maybe manage risk through those down drafts and for us the levels important for the s&p 500 about 4820 on the up side that's minor resistance we think that will be penetrated albeit briefly similar to what we saw in 2018 and then it becomes a determination from the portfolio management perspective as to whether folks build exposure short-term in nature ahead of that or stay with existing exposure.

that just depends on their time price and for that portfolio of course where the risk becomes heightened in our opinion when it becomes top down for the moment all the stocks are being influenced by the market's price actions. so if the s&p were to break down we'd say that increases risk for even defensive stock so we want to watch that 4200 support level. going forward we are looking for more of a range environment this year i think we're talking about more of a bear market move and then a trading range. >> you're not even comfortable to say the lows are in for the markets on an intermediate term? >> our version of a double dip and in terms of the long-term momentum having deteriorated late last year behind the major

indices, we've seen it manifest itself i think q2 will look better than q1, but i don't think we're out of the woods yet in some retest of support >> what about gold, what about bitcoin in terms of up trends? would you say bitcoin has pulled back the last couple of days >> the risk assets and i don't think we're looking for any kind of significant pull back in bitcoin or the like, so they do have short-term break outs in the crypto currency front. gold prices look a bit different. that pullback followed a major long-term triangle break out triangle is the ultrahigh probability in my world. we're looking to trend higher over the long-term so we're looking to stay over existing positions and that would be naturally associated with a tape similar to what we have already

year to date it's all about reconciling those time frames. we have a bullish short-term bias for bitcoin and especially coins that tend to outperform when we have that kind of risk on tape. and market sentiment isn't at the point yet where it's overly bullish. we had an overly bearish reading in midmarch. and right now it's sitting at 47% where it starts to sort of give us a red flag and be above i'd say 65% or 70% so we still have room for these risk assets to move higher before sentiment gets to the point of worry for it market >> great katie, thank you take it all into account thanks a lot see you. it is just now after 8:00 a.m. in new york you're watching "squawk box. i'm andrew ross sorkin along with becky quick and joe kernen. let's show you the futures about half an hour before we get

the big jobs number. s&p 500 up about 25 points dow about 200 points nasdaq looking to open about 100 points and a preview of those numbers in just a moment we've got a panel of experts ready for instant analysis of that data when it hits the wires at 8:30 a.m. eastern time. everybody is going to be watching that number including the fed. we'll be thinking about what happens to interest rates. becky? andrew, thanks let's get over to dom chu. what's up? >> so consumer discretionary is a big focus and obviously with folks looking at the job picture what the picture is going to be like this one is a bit of a cross-section between a couple different narratives the casino stocks are among some of the biggest gainers in the s&p 500 so far this morning led by wynn resorts. las vegas up 1%. mgm resorts up fractionally right now. analysts have upgraded withine resorts to a buy rating from a prior neutral although they

lower their target price ever so slightly from $98 down to 96.5 alsothe fact there's more clarity around regulations and licensing restrictions going on in macao and china and you mention jobs day bank stocks always a big focus especially in light of yesterday's trading action during the sell-off the s&p financial sector was the worst performing sector on the day, so outsized losses in names like jp morgan chase, bank of america and morgan stanley now reversing a little bit today you can see up just about half of one percent and so bank stocks, jobs day, interest rate for the fed all kind of a big focus right now. and a check for the top tickers search on our website, cnbc.com. the ten-year yield remains

number one but among some of the single stock tickers advance micro up 1% and gamestop with the news of that possible stock split coming up, and remember wti crude is still in the top five and that ten-year two-year interest rate spread, the rest of the top ten on my twitter feed at the domino i will point this out. joe mentioned that crypto trade in the last few moments. this is the first time in a while not one single crypto currency made the top 50 list not even bitcoin >> we're getting nurerdier coming up we're under a half hour until the jobs report stay tuned u' wchg quk x. this is cnbc wow, we're crunching tons of polygons here! what's going on? where's regina? hi, i'm ladonna. i invest in invesco qqq,

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i didn't know my genetic report could tell me i was prone to harmful blood clots. i travel a ton, so this info was kind of life changing. maybe even lifesaving. ♪do you know what the future holds?♪ welcome back to squawk bloomberg reporting china now repriring to allow u.s. regulators to see the audit reports of most chinese companies listed in new york as soon as the middle of this year. now, shares of u.s. listed china tech companies surging on this

this has been a sticking point as you may remember for the two countries for a very long time under former president trump congress had passed a law that would have mandated kick chinese companies out that didn't allow for audit inspections right off of u.s. exchanges in about two years. so lots of folks going to be focused on that this morning alibaba up 6%. giving people a bid of confidence there might be more credibility behind those numbers. also new details this morning on the story of a big options bet earlier this year fallen under a lot of scrutiny. wall street journal reporting authorities are investigating at least one meeting between act vision ceo and alexander von fursenbering ahead of a january announcing by microsoft it would acquire act vision for about $69 million. since netted them about $60

million in unrealized profits so far and sources telling the journal both the justice department and sec are looking into whether the transactions broke insider trading laws cnbc reached out for comment in a statement to cnbc earlier to t"the wall street journal" dillered denied any knowledge of a potential microsoft deal for act vision also spokesman for codeck saying the ceo didn't reveal any sensitive knowledge at their meet the story of course raising lots of questions about appropriate conduct and we're going to talk about that right now joining us is harvey pitt, ceo of consulting of a law firm of colorado partners. thank you for joining us he's been very outspoken and said it in a statement and i saw it again said this was a coincidence and have a thought this was a buy out target or maybe something that would get taken private

he believes there's e-mail traffic or other things that would demonstrate that but it does raise other questions and assuming he's right, and i don't know if you assume he's right, but if he is right, what ceos, what kind of meetings ceos should or shouldn't have this was an apparent meeting >> the difficulty you have here whether or not anything untoward took place this meeting was to put it bluntly stupid. the reason i say that is you've got a ceo under fire, and the negotiations with microsoft didn't just happen overnight there had to have been discussions going on when you then sit down with potential investors, people who might be interested in trading, even if you think you're not disclosing confidential information, your body language may give things away

your refusal to answer certain questions, your hesitation can create problems. this is not a smart meeting by any stretch of the imagination >> okay, harvey, i'm going to take it in a slightly different direction. let's assume this is a social meet wrg, which i believe at least what bobby codeck and i think they went into that meeting thinking it was. you have a social meeting. maybe you -- you give it away through body language or not let's just say that's the case actually and then your friend because we're calling this a social meeting not an investor meeting goes off and makes a trade, doesn't tell you obviously and just goes off and does this. which, by the way, may be closer to the sort of facts of this case than anything else, which is they do have this meeting, but then several days later david geffen or others suggests

this maybe alex von furstenberg thinks great, maybe this is a good idea and after this breakfast or brunch i had something could eventually happen then what? >> well, at this juncture if that happened it seems to me that the people who traded should have realized that having even an innocent socialmeeting just before making a major trade was going to raise enormous questions and put the ceo in a very difficult position. this is not the kind of conduct that should be taking place. it's the kind of conduct that raises questions, and even if everything is innocent, it's dplus just foolish and the way to avoid it is for ceos when they're engaged in very serious discussions to stop

these social meetings with people who might trade or at least be certain that if anything got said at the meeting that might have tipped off a potential trade, that they then make disclosure to the public at large. >> hey, harvey i hear what you're saying on that, but wouldn't it be more of a tip off to everybody if a ceo suddenly cleared his calendars because he was worried about any social event he was supposed to be attended being seen in just this matter? if somebody suddenly says, oh, i can't come tour party saturday night and can't meet you for luncheon saturday and won't be available for that breakfast on tuesday i think one of two things either you had covid or you're in a position where there's something big happening at your company and i need to pay a little more attention. >> we have to go back a step and recognize that this was a ceo already under fire for his

apparent mishandling of abusive conduct within the workplace when you're in that kind of a stressful situation you take steps to lower your profile. and social meetings don't have to take place. there are lots of reasons why they may not make sense including having to give root canal or going to a family gathering. there are many explanations that can take the burden off the ceo. but having these meetings while under fire and knowing that he was in the process of negotiating something because microsoft didn't just come out with an offer full-blown when it was announced, it took a while to get to that point he should have avoided his

social contacts until he was in a position to make a public announcement >> and this just goes to liability slash responsibility and how you think the sec could look at this let's say just for the purpose of our discussion that there really was above board in the context that nothing was said during said meeting, maybe body language or somebody thinking they're reading something that they aren't. who knows? but clearly barry dillard has been quite publicly about his perspective on this which is he believes that's not the case it would be complicated, i would imagine, to charge mr. codeck with anything because it's unclear whether he would have received anything of benefit back, right? i mean that's one of the issues around being a tipee if that's

what we're describing here, and the second question is how you would hold or not david geffen dillard or von fursenberg or not based on that information. >> i think you are correctly dissecting the question into the legal issues, and i'm trying to look at this pragmatically to me it's not so much a question of whether codeck violated the law to me it's really a question whether he had any business meeting with anyone at a point in time when it was likely he was already in discussions about a possible acquisition by microsoft. whether or not that acquisition might ever take place. he owed a fiduciary duty to his shareholders not to jeopardize -- >> how would you know that your

friend -- assuming what you're saying is right and this also assumes somehow he either had baldy language or worse, how would you know that your friend -- i don't think contex wale the way their relationship works to the extent i understand it was that. meaning if you came over to my house and i happen to be ceo, it's not clear to me i would consider that you might trade in my stock if i was in charge of a company tomorrow >> you're absolutely right, but the casebooks are filled with instances in which people went to social events at a time when they were involved in very sensitive discussions and other people picked up on body language and traded. and there was liability in some of those cases

here i'm not suggesting that there is liability as i said earlier we don't know what actually happened what i'm saying is he didn't have to have these meetings, and he could have made an assumption that one slip or one wrong movement or one hesitation could lead somebody to trade and you avoid circumstances like that to protect your shareholders. that's wholly different from whether there's liability. it's just not smart in my view >> harvey pitt, always good to see you and get your perspective and analysis of these situations thank you. >> thank you >> becky >> thanks, andrew. still to come this morning the number of the day. he've got the march jobs report at t bottom of the hour. stay tuned

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okay here we go when we come back, we've got that breaking economic data. it's the march jobs report it is just a few minutes away, and our all-star panel is ready and waiting with predictions we've got the insights once the numbers hit, too stay tuned you're watching "squawk box," and this is cnbc

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welcome back to "squawk box" on cnbc. march employment report just minutes away let's bring in our jobs panel. jason furman is former chairman of the council of economic advisor, currently a harvard kennedy school professor lot of titles here and not a lot of time. former acting ceo chairman at theic kato institute.

stephanie link, chief investment strategist at high tower advisers and a cnbc contributor and two people who need no introduction of titles, our own rick santelli and steve liesman. it is time now for the march jobs report, and rick santelli has the numbers. rick >> yes, the numbers should be hitting the strewn momentarily 431,000. 431,000 on nonfarm payrolls. it's a b bit of a miss private payrolls 426,000 and also a miss looking for a number close to #00,000. change in manufacturing payroll a little better at 38,000. that follows 36,000, but i shudder to go in the rearview mirror and price and see some revisions there. the unemployment rate a new low, 3.6% 3.6%

we all know pre-covid that was 3.1% in february of 2020 getting ever closer. up 0.4 on average hourly earnings month over month. on a year over year basis that was 5.6% so 0.4 in month over month, 5.6 in year over year. that is a new high-water mark. and if you look at average hours work, 34.6 tick down 0.1 versus expectations and rearview mirror the under employment rate was 6.9. that is also a kind of post-covid low, and that's a great thing to see and labor force participation, 62.4 that's exactly 1 point under february 2020 which was 63.4 the high-water mark there, we do see on the interest rate side, we're close to 242, but the real

issue continues to be that this is now the 12th month, a dozen months above 400,000, even though it was a bit of disappointment and in the rearview mirror here's some revisions. and they're rather healthy and manufacturing payrolls last month ticked up 2,038 which makes this month unchanged of course we're all going to pay very close attention to the first day of the new quarter it certainly seems to have popped interest rates a bit and certainly seems of course put some volatility in the equity markets especially after lots of talk of rebalancing last month and some option trades joe, all yours >> thanks, rick. 12 months, almost like it's a year kind of almost. let's get right to our jobs panel for some instant reaction. all right, jason, there's things that you're anticipating on one

of these reports that you're hoping things are better and then you're worried about something that might not be up to speed can you list the two >> that's roughly the pace they've been on for the last year and that's consistent with a decent amount of inflation this year last month we got a bit of a reprieve in terms of average hours earnings growth. the second biggest news here is the jobs number. i think that's a pretty small miss you have the positive revisions to last month. you have the larger than expected decline in the unemployment rate. you have the increase in the participation rate overall this is a very, very strong report and no reason at all for the fed to do anything other than 50 basis points at the next meeting

>> yeah, 50. tyler, good speed. that number kind of threw me so we're definitely going to do 50 i know what i was going to ask you, the participation rate almost back to where it was. so what about the great resignation, the new normal, the post pandemic world, totally different. maybe not so different >> well, that's certainly the hope, and it is encouraging to see at least a 0.10 tick up in the participation rate one thing i'm going to be looking for digging into the details is what happened to participation among those 55 and older because as you said there was the great resignation. by my estimation about 1.5 million early retirements in 2020 and 2021. we're really going to need to see those folks come back because one thing we've seen in the past year 30 to 35-year-olds coming in the labor force are not experienced for those 55 and

older leaving the working force. >> we can't expect this type of strong activity necessarily to continue there will be a post-pandemic not really a slow down but maybe a reversion to the mean in terms of gdp and everything else are we seeing any of that yet or this is still something we can't keep up forever? >> you know, over the last six months the pace has been around half a million you are seeing a bitof a moderation and the closer we get to maximum employment i think the more these monthly gains will moderate. but i'd like to pick up on what chair powell said earlier because there's something missing in this report it's great, i'll take it but it doesn't equate to the concern that chair powell expressed that the labor market was tight to the point of being unhealthy. and you saw that in the jobs

data but also the jobsopening rate and we're still in this place of imbalance between labor demand and labor supply companies are having a difficult time hiring and retaining in this environment, and in the meantime the skill set that companies want is changing so it's time even though this machine has gone on for a while peeking under the hood to see where the wage gains are critical in this moment. >> i'm just going along this has nothing to do with me and this could be the most important comment. >> could be. i think the number is very goo especially with the revisions. if you look at a lot of different job metrics in the last couple of weeks we've seen rock bottom initial claims, and initial claims are a leading indicator for jobs adp was very good, and the

interesting thing about adp they have 377,000 services jobs payrolls, right? for me when i looked at the wage numbers for today i was actually wondering if that 5.5% wage number year over year expectation might come in a little bit softer. in fact, it came in a bit better last month we know what happened it was a mixed shift more towards travel leisure jobs and that is the important number to look at. it's the wage number and doesn't change anything what the fed has to do. it's behind the curve. there's inflation everywhere and also includes yesterday's core pce number which is really hot >> movie credits sometimes the biggest actor is like and tom hanks, and that's what i'm feeling right now since you're

last here, but maybe most important and you've had time now i've given you to really have some smart things to say. >> finally something smart to say. you're right, joe. it used to be in the old days the second byline on the story was the most important one that changed over time but i'll take it, joe, and thanks for the tom hanks reference. i can do a lot worse i'm very encouraged by this report i hardly see it as a miss because economists have been so far off in terms of trying to get anywhere close to this number, the fact 60,000 is a huge victory as far as i'm concerned. inside the number, i'm taken by what you asked whomever it was, can we continue this because what we really see here is a continuation from the slow down earlier this year you had 366,000 and suggests

people are going back to the stores and by the way i'm a little more encouraged on this issue of whether or not either the market is not -- is unhealthy in terms of how tight it is because a couple of things you had about 500,000 people it looks like to me come back to the work force, and that's been three good months in a row in terms of people come back, and i'm sure powell wants to see that and one other quick number, rick is 100% right, we are back to where we were in term of theinable of people in the work force at 164.4 million our participation rate, however, is one percentage point below. why is that because we had more people coming to this world over that period period of time, so there's still some room. one interesting point here, oil and gas workers went down 0.4%, so i'll be watching that number

to see if we get more workers in the oil field. >> i'm going to start at the top again. jason, did anything that you just heard from this illustrious panel, did it peak your interest or did you need to refine the thinking of anything or any addendum >> no, i think when you have chair powell saying it's an unhealthily held tight labor market what he's saying is we're still short on where we want to be on jobs, but the issue remains labor force participation. it's still low that labor force participation rate there's very little the fed can do to change that. time is healing it every month it gets deader, but it's not something that needs to be a goal of policy. what needs to be a goal of policy is price stability in this report is not consistent with where the fed wants to be, where we should be >> one of your previous

appearances you said something that got a lot of pickup, and that was that not a single new job has actually been added. are we now -- are we up net up or still just barely below pre-pandemic >> i haven't run the numbers yet in the last two minutes or so, but i think we can say we're within either -- we're there within striking distance, but the critical thing is that structurally the economy has changed as well. it's become more slanted towards e-commerce, warehousing, transportation, retail some places in the economy are already topped their 2019 levels where we're still seeing some gaps in leisure and hospitality and more pointed delay customer facing industriesthat are typically low income so there's some work to be done. and that's also where we're seeing this proportionate impact for women and people of color. so the labor market is never perfect, and i'm always going to try to make it point to where it

can be improved. those places still exist, and i like jason's point that over time we might see some help there as well. >> tyler, how do you read where we are in the biden administration and obviously in a previous administration. are there things that they should be doing, things that they've done that it has done it has helped how do you see it? >> well, i do think it's interesting we've had a string of relatively -- of very strong job numbers in the first few months of this year, and this happened to be the first few months of the past year we didn't have the federal government ixplicitly raising the tax rates in return to work. i keep glancing down at my phone to get more details on the report i think the household survey is telling interest things there. it looks like gains 700,000 in

the household survey compared to an increase in the civilian labor force about 400,000. that to me says we're still pulling people more from unemployment or as much from unemployment as from out of the labor force, which says to me this is still a very tight labor market and when we look back on the experience of the 1960s and 1970s, i think it's interesting in the latter half of 1960s when expectations really became unanchored such when the major supply shock of '73, '74 hit consumers, households weren't able to look through that. in the past year we've run sort of a compressed replay of that scenario >> is that a sneeze or a cold? >> well, you know what, i think it might just be the sniffles. we have to wait for the close to really make a judgment i'll tell you what here's a wallet this is going to change things, okay, because we're going to get

back, are we going to normalize? this is going to answer it and the answer is yes to all of those, and i'll tell you why because the cpi rate was close to 8%. wages as strong as the out post covid high on the year over year was 5.6. there's a bit of a spread there and more you have to use more dollars in your wallet inflation and savings rates starting to go down those two issues i think are going to bring people back in the work force, and i think participation rate is going to narrow that 1% spread, and remember one thing as you're looking at twos to tens, look at where the spread was last week twos last week were under 230. this was an amazing move. >> do you think we'll get a 50 and will the 50 help usher in this inverted yield recession or

will that be part of the cause or will it not happen? will it be loathe to do 50 if we're slowing down >> if they can do three more times, four times all in and get back to normal policy, right, so they have to go above and beyond and we do have inflation yesterday's number core pce deflater is very high. ppi close to 10% those numbers next week we get the cpi number and that's going to be ugly i think they have to get their arms around this if they want to do 50 i think that the market can handle it. i think they have to do more by the way even if they did 7 or 8 this year it's not going to change inflation supply chains are going to help inflation, but on the other spectrum wages and rents are more sticky and they're going up i feel like we're here and stuck with this inflation story for a while, and that's why the market is in this choppy trading range,

and i don't expect that to change anytime soon. >> steve, will we get a 50 >> yeah, i think a 50 is coming, joe. and i think more than a 50 i think you're going to get two 50s in a row at least. i think the fed wants to get back to a 2% number by the end of the year. and by the way, that would be one of the faster rate hikes, and the question is can we take a -- i think you asked a good question of neil and neil had an interesting response what do you do when we get people back to work and we have to start creating jobs from the economy and from regular growth rather than a rebound, and just quickly to tyler we had a 300,000 decline on the number of unemployed and that was the same number of those not in the labor force went down by 300,000 as well and so we are finding a way to bring people into the work force. it may be that we're stressed, and you're right to make that

differential between the 400,000 growth in the labor force versus the 700,000 we mentioned earlier. >> okay. we haven't done this before. we've got the sixth box. do all of you have something to say that's important because i want to see how hard that would be to actually -- do you all have something i'm going to go three, two, one and everyone start talking i'm serious. let's hear it. you ready? three, two, one. no one's doing it. >> the fed at this point is mostly dealing with inflation -- >> sometimes it happens and we don't plan it. anyone have anything really cogent to say before we leave the panel? >> just one quick follow-up to stephanie's point on wages which i think is essential to the inflation story when it comes to the labor market, the fed has been able to rely on the fact a

lot of the wame growth has been low income jobs. but as you look at some of the anecdoteal evidence from companies especially in tech and the practices they're doing and the data we sigh, that is really starting to shift towards higher income jobs. and it'll be interesting whether there'll be as much tolerance for wage growth when it comes at the upper end of the income spectrum as it has been when it was for lower pay jobs >> okay, thanks. and that's it. that'll do it. thanks to our jobs panel jason, tyler, stephanie, rick and steven we're able to do that. >> we talk all the time. we'll show you guys how it's done put up andrew real quick >> we can talk right now >> so there's a reason that the panel -- >> i don't even know what's happening. >> there we go let's get down to the new york stock exchange and check in with

jim cramer this number a pretty good number, pretty strong number he anticipates the fed is going to raise 50 basis points based on these numbers what do you think? >> i think that's right. i think the fed has to acknowledge inflation is running red hot, employment is hot but as rick said inflation running hotter than employment, and that's a good opportunity for the fed to begin raising rates and slow things down we're starting to see slow down in a lot of different companies. we know the pces have slowed and mortgage rates at 5. there's a tremendous amount of pressure on -- on the price of housing and whether it can sustain these heights. and i look at all these things and just say the fed is winning, but if you do 50 basis points and keep winning, i think that's what they need to do >> let me ask this because stephanie brought up a really interesting point. so many of these issues of inflation are not related to the

fed as much as the supply chain and the issues we've seen around the place. if the fed can't fix it by raising interest rates where does that leave us >> i think the fed can fix it. i think this has to need the velocity of spent and supply chains do catch up it's not like supply chains -- i know some people feel accept my chains are broken. that's an excuse they don't know how to find the things they need they'll get it i think believe me, i think that ford and gm can get the parts they need if they had -- if people weren't buying cars as aggressively good news/bad news. >> is there something to be said for the idea of shrinking the balance sheet pretty rapidly, too? that's part of the liquidity problem. >> i don't want to shrink it too rapidly. i don't want a recession.

>> but where is the bigger -- i mean, part of the problem there's so much money out there. how do we soak it up and how much in the balance sheet and how much should be higher raise. >> what we're watching is the fed hasn't done anything they have done one small hike in every almost industry has been affected by it in ukraine. it's been, you know, there's a lot of industries that have been clobbered here so i think the fed has to do a little measure do a little measured they certainly have to do it there are hardly any industries right now, other than cybersecurity, that are not seeing pricing pressure. >> jim, thank you. we'll hear more about what you have to say in a few minutes. >> andrew wanted to talk oprah winfrey m-- over me. >> we do it to each other all the time sign up to find out more at c cnbc.com/jointheclub or point your phone tathe screen the code will take you there "squawkbox" will be right back

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welcome back to "squawkbox." today's big market story, the economy adding 431,000 jobs. it's the 11th straight month of job gains above 10,000

treasury yield moving higher we expect it to hurt big tech stocks but it hasn't been what we've been seeing recently joining us now is dan niles. you see what the fed is saying or not or what i think the market is saying about what the fed may be thinking. what do you think about the space in this context? >> well, i think you need to have a broader perspective on it, andrew if you look back over time, the fed is never been this far behind the curve since the 1970ss remember, you always get bear market rallies if you look back through history and you look at, for example, going to war with inflation, down 27% but you had six rallies within that 27% decline of 8% on average. so in the s&p 500. so this last rally we had, it's pretty typical it's on the higher end of normal, obviously.

but, you know, 25% of the bear market rally is roughly 60 of them in the last 10 declines over 30% back more than 100% of the prior leg down that's what you saw this time. it's pretty normal i think when companies are reporting, they're going cut numbers off of everything we're talking about. inflation between russia and ukraine. stocks will go down again. >> so you think they've had their run and we are or this is sort of the case -- a view of sorts. >> yeah. i don't hear what you had to say. we've been saying this consistently all year. if you look at the twitter posts. we said typically bear market rallies give 70% of prior

losses you have wages in particular, which is going to be the problem because as you mentioned this morning, the payroll numbers are really strong. you are lacking 1.5 million service jobs so you 3 million more job openings than you have people unemployed each pressure will remain high even as supply chain costs and commodity costs come down. eventually the russia situation will get solved. the biggest component of companies cost about two-thirds of the cost is related to wages. that's what is going to drive things not the 20% related to supply chains. >> you should completely out -- as we said multiple times. if you're a retail investor, you can't trade the market every day sit on the cash. that's the best thing. wait it out.

the fed will be raising rates this entire year if you can buy stocks that will hopefully outperform and put shorts against that and be able to make money, which is what we've been doing but it's really difficult. we have areas we like. we like areas like banks, which benefit from higher rates. we like areas like energy, though, you know, we would be buying well below 90 i'm sorry low 100 in the 90s and so those are areas we like it's like the opening place. we bought a lot of names and cruiselines, airlines, hotels, online travel, online dating we have matched up against a lot of shorts in areas like computer hardware, smartphones, where we think those are the last pandemic give backs. i think you'll see a lot of estimate cuts in those spaces. so that's kind of how we're positioned right now, andrew. >> but it sounds like if i called you two weeks from now, you might be in a different

place. >> absolutely. that's what we've said if you can trade, you trade this market, which, obviously, this is what i do full time for us, you know, and we've said this multiple times is when the market gets to levels that 17 technical indicators we follow indicate it's over sold. that's last time you had on the show and becky interviewed me, we said we expect a short term rally. that's what we got now we're layered back in a lot of our shorts and by probable early next week we'll be net short again on the fund. because we think you'll see a lot of reannouncements starting monday night and extending to the first week of april. i think stocks will go down. you look at 0 key bee, restoration hardware, ui path which all have february quarter ends, those stokes were down a lot into their earnings releases they got clobbered when they reported and talked about things like europe, which people should have already known so that gives you, i think, a road map specifically ado bee if

you're a tech investor as to what can happen during the in season even if things go down. >> dan nooils, we want to thank you for your perspective a little bit of a downer but realistic downer we appreciate you being with us this morning that -- that does it for us on what was a big day quite a number make sure you join us next week. have a great weekend, everybody! "squawk on the street" begins now. good friday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer a solid jobs number for march. 431,000 shy of estimates unemployment down to a cycle low of 3.6 wages up 5.6 labor force participation up for a third straight month we'll start with that jobs number, jim. we added