q 1 was brutal the worst quarter since 2021 interestingly, i think the u.s. is going to be an outperformer. >> thank you "squawk on the street" is next good thursday morning. welcome to "squawk on the street." i'm david faber along with jim cramer carl has the month morning off half u hour from now we begin trading on this thursday our road map starts with stocks. they are searching for direction after what has been a two-day sell-off we'll talk to jim and apparently it says here you think stocks are poised to bottom in a rally soon >> i'm calling for a broader

market in less of the faang. >> i have to finish the run down. >> it's taking up to a $5 billion hit. we're leaving russia exxon andchevron telling congress, by the way, they're not capitalizing on the prices by raising prices at the pump more than perhaps is warranted and berkshire hathaway reveals revealing a major stake in the company. >> don't laugh that's part of my bullish thesis. >> that was in there reveal revealing. >> in what it just comes out of your head. >> that's the only thing we read, that's it. we're done with the reading. now it's just who knows what is going to happen. we'll start off with the markets. yesterday you said you were conservative you said you were very conservative i read there -- >> no, i'm very onservative. >> you're poised to bottom in rallies. >> i'm conservative on big tech.

one of the reasons is because a lot of companies have been buffeted in the buy in by a recession or consumer or covid these skated they skated because they do not have inflationary pressure. >> why wouldn't an alphabet continue when you say big tech -- >> yeah. and meta are the two cheapest things. >> okay. >> we sold some amazon for a travel trust because, first of all, stocks have done nothing. it's telling but it's not cheap there are others we feel we have to trim back and the new things we like are things that -- i'll give you a great example is wells fargo. >> okay. >> if they have one oligarch, it would be a shock to me not one oligarch but they do have a huge base

if the fed is to be taken at face value, why shouldn't you buy that stock that's the kind of thing a broadening out about a conservative attitude toward the stocks that have gotten us to where we are. >> when it comes to wells, obviously, had a good year last year significant rebound. >> right. >> after underperforming for many years, given all the different difficulties to put it nicely for them. >> it's down a lot it has the scapability of adding more dividend. charlie sharp a tough banker replaced everybody. >> yep. >> i expect excellent quarters >> you do? >> yes. >> from back in the days when it was a leader and it was a big buffett to be, of course. >> oh, yeah. we used to talk about the housing market a lot they were a large underwriter of mornls now we have mortgage rates above 30 or above 5% i don't know if it hurts the business.

>> that's a great question i think they're a great servicer i check with -- this is a hard one for me i check with the major homeowners yesterday none of them are seeing any weakness, which is surprising given rates. it's the highest end it's the 2 million and the 5 million where there's weakness and the home builders don't put the homes up there's a tremendous shortage. i want to go back to something you said we haven't talked about enough is work from home i'm with cory barry today, the ceo of best buy. >> yep. >> when the pandemic started, people just did this kind of ad hoc -- basically what i would say is built offices now they realize, you know, we're not going back let's build a realoffice and that is happening. and you know at the corner stone of a real office

>> it gets us there. i'm glad you brought up work from home. when we look back on the pandemic, the line will be there as one of the most significant outcomes was a forever change in the way that people used to work people may not believe it but we didn't really go into this in a great detail dimon's letter earlier in the week he spent a lot of time talking about -- and basically saying it's true. >> totally ignored my people. >> we're going to be working differently. by the way, this is a company jpmorgan that is building a magnificent new tower on park avenue and 49th street they took down good old 270 and will have a lot of employees there. he said generally speaking, many employees, approximately 50%

won't necessarily work at a location so 50% 50%. half some 40% will work under a hybrid model and 10% working from home. he's throwing in the towel. >> i showed you video of an entirely empty floor. >> david, i would say at a certain point, if that's the case, then you do shrink your footprint. >> yes. >> and he did say that remote work will change in how we manage our real estate. >> why is he talking about >> we move to more open seating arrangement, which digital tools will help manage seating arrangements as a result for every 100 employees, we may need seats for 60 to 70 on average. >> and as steve said to me, the ceo of american express, it will be only purpose built when you go into the office there has to be a specific reason some analysts are saying sell

home depot and lowe's. the bubble is about to burst on the work from home how can the bubble about to burst when it just started >> no, it's a similar change in the way people work. we do talk about it. we sat here the dinosaurs talking about how we believe people should be back in the office we talked about it we're more than two years since many people left the office. certainly there are certain days you can see more traffic and midtown is busier here, which is a way to judge it, it's nothing like it once was and probably never will be. people go to the office and they go and they're alone so what's the point? >> i think it's a major change and a lot of them feel it's some sort of short term thing i think the opposite it's bullish. >> we'll talk about the hp position. >> i want to move on to the

consumer yesterday you and i were having the discussion about fed tightening hard landing. worries about the consumer, as well inflation, obviously a number of things that point to a strong consumer. >> yeah. >> you have some sound, i think, from best buy. >> yeah. >> we have a handle on it. >> levi strauss and the conference call. chip saying some things. let's take a listen, if we have that from the conference call. chip in terms of the strength of levi strauss. >> i don't want to suggest -- we're reading the same headlines everybody else is and the same jamie dimon letters. we're watching it carefully, but at this point, the consumer seems to be really strong. our brand still represents a tremendous value. >> and, jim, you spoke to corie barry from best buy, as well you asked her about the consumer why don't we take a listen to that, too. i think it sets up well for this

conversation. >> two things you can say about the consumer e uneven and unpredictable you have those things and a strong housing market and mortgage rates increasing rapidly. you have still strong balance sheets but you can also see interest rates probably rising and credit getting a little higher you have geopolitical unrest so you have the consumer who is kind of got two sides of the teeter to thor at any given point. you know better than anyone, every day that is changing for the consumer >> best buy sells at nine times earnings and levi strauss at 11 times. there's room for the nonhigh flying teches. and yet the nonhigh flying teches and the high flying teches is where everybody is clustered. hp is not. it's an expensive stock. >> right i'm seeing a note, as well, b of

a overall card spending on a three year for the month of march up 23.2% only down 40 basis points year over year. declined heavily distorted by the stimulus a year ago in march. key observations lower income groups continue to lead the higher income group in spending. >> yeah. >> how about franc del rio coming on "mad money." just adding ship after ship after ship why? well, you know, demand they have a brand new ship coming in september. we have weakless jobless cl claims falling to 166,000 last week the lowest level since 1968. i feel like we have one conversation one day, jim, and then we have a conversation the next day that is somewhat 180 degrees. >> it was bad tuesday and bad yesterday. we have bullard saying the

monetary policy around 3.5%. okay where is the 30-year >> bullard said a generous ratingaround monetary policy - 3.5 needed to fight high inflation versus the current rate of 2.5. so bullard is basically saying he wants financial tightening but fed remains behind the curve. >> i think it's happening. that's one of the things you have whip sawed yesterday. did brainard change her mind influenced me and -- >> they thought it was the dub and it was not dubbish and the restoration hardware brand has me concerned. >> refresh for people. >> rich people are -- global

issues are worrying rich people. one of the things i want to bring is in the eu countries have paid russia $38 billion since the war began. they're on track there's going to be $325 billion by the russians. it makes it seem like it's not going to end if you listen to the conference calls, mostly, by the way, the letter to shareholders, you would say i have to stay away. >> you don't realize the stock has been almost cut in half. >> do you want to short rh i'm more interested in buying it, if gary were to be a little more, i would say, reflective of the longer term. i think he was very caught up in the short term a lot of people are. they can't see putin pulling out. they can't see what the fed wants being done now they can't see it collapse in

rates and freights they can't see a collapse. there's been no collapse in plastic. no collapse yet in paper i mean, the fundament. when you look at a general mills, okay, versus conning a are a. they reported bad numbers. to use my larry kudlow -- >> he works for another network. we can't quote him. >> doesn't friendship -- nope. >> i can't mention him even though he's my former friend. >> correct i'm saying he's banned a gentleman. banned gentleman! >> banned! i'm caught i liked steve min knew shen. >> he never worked for another nes network. you can say his name let's talk about the hp position that berkshire took on.

we'll do that when we come back after the break. >> i hear the music. >> what it means for the stock price. we're going to get started with trading here in about 16 or so minutes from now no longer looking like an up open ♪ ♪ nice suits, you guys blend right in. the world needs you back. i'm retired greg, you know this. people have their money just sitting around doing nothing... that's bad, they shouldn't do that. they're getting crushed by inflation. well, i feel for them. they're taking financial advice from memes. [baby spits out milk] i'll get my onesies®. ♪ “baby one more time” by britney spears ♪ good to have you back, old friend. yeah, eyes on the road, benny. welcome to a new chapter in investing. [ding] e*trade now from morgan stanley.

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we just saw it we'll show you again. shares of hp the stock is up sharply because berkshire hathaway of warren buffett revealing it owns roughly 11% of the company. of course, it's a pc maker, printer, total value of that stake about $4.2 billion it's been a good performer we've had enrique on many times. they announced the deal. maybe it was last week. >> yeah. >> yeah. bud polly the old -- what was polly's name before? >> oh, gosh. >> the headset thing. >> anyway. come on. this is what i'm talking about the stock yields 3. >> yeah. >> it sells at eight times earnings it doesn't miss the quarter. it's brought back an endless

amount of stock. it raises the dividend this is right in warren buffett's wheel house. >> i find -- hp buying polly which is the old plantronics it helped them with work from home. >> yeah. that's why corie barry, the ceo of best buy, who will be on tonight, saying, look, work at home not surprised. it's actually so good. >> right. >> it's not as though the enterprise is important for hp it is. >> it's huge enterprise is strong what she's saying is, you know, look at the motd ls -- models. i have to upgrade. everybody is missing a point about this new model it really helps you to have -- you need a big upgrade for everything that's why i think it was so smart to buy the plantronic. it sells at eight times -- that's a bear market multiple. >> it is

eight years worth of earnings. >> enrique -- i met him for breakfast when he first took over -- i said you have to perform. that's my style. i like to be a kind person and look at the numbers. i said, jeez, that's -- >> they have to be happy with that obviously, the performance of the stock rose the last couple of years. >> look at it. it's a big beneficiary of the trend we have spent a lot of time discussing at the outset of the show people will be working from home maybe forever. >> when it was at 15, he was buying back stock. this is our time you have the good pc and don't forget, get the pc it's a touch screen. >> yep. >> i got it. i love it. i love it!

berkshire has been a good stock to own. >> yeah. the meeting is coming up a few weeks away. >> yeah. i'll go out there with andrew. just kidding >> no you're not the meeting is coming up you know, it's always -- when these positions get revealed, it's never completely clear if it's warren or somebody else. >> true. you explained that explain to people at home, david, there's a man -- a man who is maybe the smartest of our kind and he buys 11% of a company and then there's another man, the smartest of another era, maybe, still good buys 11% of the company. we make a big to do about the first man, elon musk does it and does it. how can they come up to 11 and sneakily buying it and another guy does it and we want to say -- no.

>> i don't want to devote too much time but mr. musk's position in twitter was clearly an active position, so to speak. one in which he was trying to engage with them in discussions about their operations in a way that is not what typically warren buffett and his team do. >> yeah. >> in more taking a passive stake. the largest single ownership is apple. $160 billion worth of apple stock of berkshire hathaway. it was a great purchase for them a guy not particularly interested in technology for some time. didn't make a great investment in ibm by getting out. but apple worked out big time for berkshire.

do they still own wells? no insurance is a great business now. it's a bear market and that's wrong. >> my stuff is on the corner of his desk. >> i know. you have 17 houses. >> 18. >> we'll have jim's "mad dash. and a look at futures as we get ready tota tdi f t srtrangorhe day. more "squawk on the street" ahead. ♪ ♪ i call it.... the wheel. ok, this is a miss. it's a fork.

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there it is. what we used to call faang now we have to call it maaang. maang? you endorse that >> i'm okay with it. >> all right meta, of course, which is down over 30% this year appears to at least be in store -- >> that's where the pressure is. i think it should be on meta. >> i like maama. the opening bell coming up

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all right. we'll get to a "mad dash" and then the opening bell right after that conagra name want i wanted to get to. >>yeah.

>> what accounts for the conagra for the inability to pass along some of the increased costs and constellation to be able to. >>well, i think that -- look, i know that historically people may not realize but there is very -- people are drinking beer at home. it's a bargain versus the restaurant and -- but, i want to make it clear that constellation is different from the other beer companies. they have growth they advertise well. they also have beers that over index among hispanics, which is an incredible cohort and they are kept back by the canopy growth position they had. they're very smart.

>> back to conagra for a second. what is the take away from the numbers? >> i really got to see it. you know, we've got real differences. campbells hasn't been able to do it general mills has been fantastic! so it's very catch -- i keep hoping for conagra to do it. it hasn't happened we'll see how they're doing. it's very much what i would describe as being -- >> all right [ opening bell ] >> taiwanese electric scooter company, which listed via spaks. >> spak. >> spak. >> india is on a red hot grid. >> yeah. india has not gotten a lot of

heat -- >> no. they're all so tremendous -- tremendous we have no right when i see indian stock, i'm reminded there are issues that you need to think of. >> yeah. >> you know back to the conflict which we haven't talked about a lot in conflict in ukraine russia's war in ukraine. shell taking $5 billion -- >> this is how it works, david. >> for any number number of activities. >> they spent the money. where is that infrastructure who did they sell it to?

>> nobody. there's some item they're calling -- we can't do much of anything with it and so that is the write down. by the way, these companies are benefitting a great deal from the underlying price of the commodity. generating at enormous amounts of cash flow right now we'll get to that in a moment. these are not insignificant break downs. the biggest will be bp with the ownership. >> yeah. >> we don't know what the number may be as much as $20 billion. >> i would buy that stock. >> bp? >> oh with yeah. it's nowhere near where it can be they're poor commute caters. the curve on oil is going down that's why our government berates the oil companies for not producing more they look at the curve and say if we start now, the possibility oil will be less the oil stocks have never been like they are.

they are berated for doing what they're doing. you think they'll double >> yeah. why not. up $30 a barrel in the ground. selling for $100. >> not bad. >> yeah. >> it works. >> yeah. do it in volume. >> it works every time. >> yeah. they're actually getting some heat you had what i call large think theater call hearings yesterday. >> yeah. do we have this? where they're unduly benefitting from the rise in gasoline prices. >> mr. woods, is your company taking advantage of the crisis and keeping prices artificially high in order to increase your own prices >> absolutely not. >> mr. worth, is your company

taking advantage of the crisis in ukraine to keep prices artificially high in order to increase your own profits? >> no, we are not. >> clipped, short, to the point. >> under oath. >> look at the way it reacted. the congress people acted as if our companies create the price of oil. >> as darren woods said, no single company sets the price of oil in the gasoline. the market does. it's based on supply and demand. russia controls a lot of markets. we should have thought of that ahead of time. >> what are we supposed to think about ahead of time, jim >> we were the ones telling everybody they're going to attack. >> yeah. you couldn't believe -- >> some people manage to store things and other people didn't.

>> aluminium prices. >> yeah. and, you know, we spore ratically come back to the conflict the impact on global commodity prices where are you right now on that? what are you hearing and seeing whether it's supply chain? >> 13% comes and the war goes on, we'll have problems with ag, which is why they're recommending ag. that's why it has to come down, though the american consumer has already taken it with gasoline you have to have it. it's not set by us. >> it's not. >> no. we don't need to trail we need soy. unless everyone goes vegan.

>> you haven't gone vegan yet, have you. >> what is it called >> mad vegan. >> is that a show? he's laughing at me. >> you are dope -- >> he watches it. >> you're going to crash. >> bad vegan what is it on? >> how can you -- i don't know it's on my watch how can you not watch it jamie is the star. >> what? >> jamie dimon. >> why do you keep coming back to this? >> because a major ceo of the world's largest bank figures prominently in an episode six. [ laughter ] he's great how did he know? >> i haven't watched it yet. >> he could have come with harry -- >> i did watch john oliver take apart the trucking industry.

i mentioned that walmart cnbc said it'll raise trucker's pay and start a training program obviously, still a driver shortage. >> no, there is no driver shortage that's what i'm telling you >>well, that's wrong. >> that's wrong. it's why i'm getting bullish on people -- on companies that are buyers of things. >> wasn't us another news organization. >> fuller wants to stop -- >> we know there's no trucker shortage. >> some of the names moving this morning. the sofi is down. >> someone sold a lot of stock -- >> no. they lowered their guidance. obviously there's an exemption to the student loan moratorium, as expected.

they lowered their adjusted ebb d -- aebitda targets >> i paid my student loans with credit card. you're paying off 3% -- >> yeah. because i was genius when i got out of harvard. >> yes. >> i didn't go to harvard to get stupid. >> no. uncle popular. >> not a lot of credit checks then what about fico stores did they replace fico? >> sofi hasn't performed very well it was a spak. >> yeah. it had a huge run and did a huge secondary. if you owned it and blew it out of the secondary, i think you would say, wow, that was good! >> yes. >> if you're like me, i would say i want the names of the people who got out of the secondary. what did they know what did they know >> what did they know? >> what did they know maybe they knew ahead of time

we've seen it happen. >> we have questions about what people knew and when they knew it when it comes to are cay go one of the extraordinary things i've seen in a long time managed care >> the stock should be 94 cents. let's go over the discovery. >> i suddenly get something. >> yeah. how would you describe that? >> yeah. i know the numbers i don't have them in front of me. >> how would you describe it what do you do with it keep it or piece of paper, so to speak. >> i need to speak to john.

>> he thinks the company has new great prospects. he thinks it'll be undervalued now. he thinks david will be able to successfully execute on the vision they have in terms of direct to consumer both through discovery plus and hbo max. these are undermanaged assets. there's a lot of costs to cut. that's what he would think. >> i want to buy it. >> at the same time you might be afraid of the enormous amount of shares. >> flow back from people who don't want to own it any longer. >> there was a great american that ran a lot of discovery? >> jeff. runs any number of the assets that will be part of it. >> yeah. part of the discovery company. >> yeah. >> delightful man. trashed me in front of 2 people i said i think you should break it up. said that's what people who have haven't really done any work and have the rigor say

it would have been better if he said it to me in a closet. >> you have such a long memory there's the archegoss bump there's are the discovery and at&t >> i'll be following it closely. don't worry. speaking of m & a. there's one deal this morning, not an insignificant one 8.3 billion cdk. they are sass. they help dealers and auto manufacturers run their businesses what they say more efficiently. >> right. >> i note them because they have a deal. >> you try to get me to cover it they made a lot of money >>well, he sold the company. >> yeah. the private equity group brookefield business partners. >> they have the nielsen deal.

that's a big deal. >> yeah. >> he wanted to ensure the service for autos. >> yeah. >> this is a sizable deal. by the way, a couple of interesting parts of it. it's all cash, obviously as you would expect. it's kind of rare. it speaks to the strength of the financing markets. they've been sitting there and done a great job nobody cares it's a bear market i'm teaming you, this is what tells me we're okay. cdk global when i see brian i congratulate them know why when elon musk called me -- >> he called you >> no. he called you a -- what did he call you again >> a hologram.

>> no. we have to go -- >> yeah. the two of us can't. >> yeah. >> he came to my defense when musk said there was a 50% chance i really didn't exist. >> right. >> and they said it's really only about 28% [ laughter ] >> okay. all right. >> think about it. simulation said it was a simulation but cdk global is a real company out of nowhere brian told me to buyit he said -- what did i know?

before i get to bob, tell me your views yesterday you said very conservative. >> very conservative on tech and the rest of the market, i think, has a real run. >> you do? >> yeah. i think the money will come out of big tech and go into the rest. >> remember, look, people kept saying i'm narrow. narrow is a bear market. broad is a bull market. >> yeah. >> that's what i think is going to happen. >> right. >> i think we're going to bob. >> yeah. >> let me clarify something quickly. yesterday discovery and at&t start trading warner discovery start trading separately it's monday. they close tomorrow. monday is when they start. >> right. >> yes elon musk many years ago said you might be a simulation. you have never gotten over it. never gotten over it.

>> it crushed me it crushed me. >> i have. i've said on-air i think he's a great man. >> okay. i think he's brilliant. >> elon musk >> yes. >> there was that very moment where i was the person who runs 23 and me. will.i.am was there. the chairman of microsoft. >> move on. >> oh, okay. you're right. >> yeah. just move on. >> i worship the guy and he crashed me know what i felt like? i felt like when you bring down the tablets because it's seasonal and he thinks i'm worshipping -- i'm dolphin worshipping the golden calf. i was worshipping him. >> did you have -- did you drop one?

>> no. >> we'll get to bob. take it away [ laughter ] >> i've known jim for 25 years, folks. he's not a simulation. trust me i'm sure of that notice the dow is down the s&p is not we're having trouble with the industrials, cyclical stocks, that's a problem because we're growth problems. banks are just acting terrible, also jpmorgan is not doing anything goldman sachs. take a look at the sectors let's buy metals tired of looking at xme every day? i am that's what happens. so tech is flattish. banks generally are still down we're going into earnings season on that. new lows we keep getting assorted new names now we have goldman on the new low list citi group has been there for awhile general motors ford at the lowest for a year. not a 52-week low. so the bottom line is the

markets are finally getting the message the fed will be aggressive in raising interest rates. that has a lot of implications for growth jim mentioned conagra. i want to point out what they said it's interesting the earnings were in line. we don't worry about that. what is interesting the guidance because they talked about what the problem was with the fact they had to raise prices and the inflation impacts. here is interesting. 6% organ i think sales that's a good number it's entirely because of the prices they raised prices in the mix almost 9%. the volume was actually down almost 2.6%. isn't that strange so what happened here was it was all due to the fact they were able to raise prices now what happened with the volume story here is what they said let me put it in english for you. in plain english we raise prices.

some consumers decline to pay the prices the higher prices, but, you know, the number of people who declined to pay the higher prices it wasn't as bad as we thought it was going to be that's generally good news there was some elasticity. some people pushed back. that's a little bit of a warning sign you see con ag ray is up here. the company and is planning more price increases. it's not clear they'll be able to get them through in the next several quarters now you want to get more on this jim has it of course, the ceo of conagra will be on tonight with jim. we'll get a little more information. i hope jim asks him about the interesting decline in volume because that is some demand zbrux going on there so what is happening here is the market is acting like we're in a late cycle phase of the economy. what does it mean? i know i hate throwing the jargon at you but late stage of the economy is a stage before a recession. and what is in the late stage? rising wages you get higher inflation do you get decelerating economic growth and profits does it look a little bit like

what we're doing now if you don't think so, watch the stock market it's acting exactly like that. in the late stage, cyclical stocks go down and commodity stocks and defensive stocks tend to either hold up or go up guess what that's exactly what we've been seeing here! so take a look at where we've been doing i call them the fading sectors here. jim has been talking about transports for a long time it's in the last since the end of march home builders, transports, retail banks this is all the classic cyclical stuff has been declining what has been holding up exactly what i told you. commodity stocks like energy, defensive names like consumer staples, and utilities and health care. so, david, who knows if we're going to late stage. the stock market is acting exactly like that. it has a lot of implications from the earnings situation. q1 will be fine for earnings i think you'll seethe q 3 and q4 numbers that are high now they'll start coming down, if the market continues to believe this kind of story

back to you. >> interesting, bob. >> thank you constellation brands are up 9. they're on the opposite. >> yeah. i tell you, i got an elbow doc will you please go to him already? >> want to - >> he is betts in the country. >> it's getting old, man jim's got something extra for you today. tune into the cnbc investing club monthly meeting at 12:30 meeting. find out more at cnbc.com/jointheclub or fput yor phone at the qr code on the screen and you will go right there. >> my trust is here. it's not in another firm, okay >> a quick bomb before we head to break, treasurys this morning, you can see ten-year -- >> 30-year is going to go to 3.5. bullard gets his 2.5 and we are

happily ever after. >> there you go. we'll be right back. ♪♪ in the future we'll travel to incredible places with the help of magical technology. but what about today? i want my magical future now. ♪♪ i have places to go. ♪♪ rocks to climb. ♪♪ sights to see. and flights to catch... i can't wait for what tomorrow will bring, but in the meantime, let's enjoy the ride... ♪♪

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take a look at shares of constellation. we talked about the quarter, a strong within, and man ster. this morning's press release twice says there is no change to constellation's capital allocation strategy which is focused on returning cash to shareholders and investing in beer capacity. if they were in talks to require monster, you might not have expected that direct of a 'lbeacrit te wel bk ghafr this

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all right. time to tell -- you tell us what's on. i see it there. >> sure, investment community meeting at 12:30 we will talk about best buy. that's on tonight. corey perry. and conagra. you heard amazing description, p bob pisani these stocks aren't going down >> okay. all right. got it >> i love this show. >> me, too you look great. >> all right appreciate it. see you later. >> yeah. >> stocks are trying to snap a

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♪ good thursday morning, everybody.

welcome to another hour of "squawk on the street. i'm david faber with morgan brennan. qua carl quintanilla is on assignment markets right now, a bit better than we thought at least a half hour ago you see the dow is the one index down >> 30 minutes into the trading session. here are three big movers we are watching starting with hp, inc. surging on news that berkshire hathaway taking 11.4 stake in the maker of personal computers and printers shares up 18%. sofi sliding after the personal finance company cut its full year outlook after the white house announcement student loan payment moratorium would be extended, this time through the end of august. you can see sofi shares down 6.5, 7% now. and we will end with conagra, issuing a weaker than expected forecast setting higher costs for transportation and raw materials. shares are up 1% david.

>> thanks, morgan. now that they have a more specific idea at least of how much the fed will be reducing the balance sheet, economists are trying to estimate the effects of that. steve liesman has that story for us steve. . >> yeah, good luck, david. if you are puzzled about how much tightening comes from the fed's decision to to quickly reduce the balance sheet, the fed and most economists are, too. they are reluctant, the fed is, to use the tool as confidently as they do interest rate hikes hard to quantify economists have studied it, come up with general rules of thumb to think about it. forgive how difficult this chart is i put together the amount that is expected of qt, or quantitative tightening, under the fed's program and translated that into potential basis point hikes. so the 700 billion expected this year, another 25 basis point hike the 1.8 trillion next year,

another 65 basis points and maybe 3 tril over time, add 100, 125. here is what the fed's plan is they told us yesterday they have agreed to it 95 billion per month, 65 billion of treasurys for a cap, 35 billion for mortgages. they reached that level in three months and may sell mortgage-backed securities after the runoff is well underway. okay there are concerns with quantitytive tightening. the bank system reserves to function no one quite knows what that level is. it's kind of like you get -- you know it when you get there the fed found out the hard way with a serious disruption in funding market with the qt that began in 2017. now it's going to operate under an ample reserve framework, leaving a lot of veevs in the system all right. add it up now. amounts to a fairly aggressive round of tightening. rates are expected to rise by 50 basis points at the may meeting,

75 at -- 75 basis points at the may meeting to 2.4% by year end and 3.1 by the end of 2023 those are just the rate hikes. now we put it together and on top of that the 1.8 trillion of balance sheet reduction telegraphed by the fed through 2023 equivalent of raising rates 3.5 to 3.75 percentage points over two years. and that in any book amounts to a pretty aggressive tightening cycle. >> i'll pick it up, steve. and yet it's a flurry of fed speak today. we got the communities from st. louis fed president jim bullard earlier. exactly. that even a generous reading of monit monetary policy rules shows 3.5% might not be enough. walk us through whether we are going to continue to see a fed that's already hawkish become

more hawkish when you think about bullard has been first out of the gate as of late with some of this commentary >> i think you like to run, right? you know that there is pace in distance, right? so i think the fed right now is at the pace that it can go i don't think that it can push the market much further. this is towards the upper end of the quantitative tightening estimates that were out there. i don't think it wants to go much faster on the qt, and now that it's talking about 50 basis point hikes,i don't think it wants to go much faster on rates. so the extent to which the fed is going to do more is going do more in distance than it is in terms of hurrying up the pace. i think they put that together david, can i give a perm observation? i think it's interesting all this qt sounds like it's a huge mess. if it's so hard getting out, why get in

last night is emceeing the council for economic education annual dinner. one of our honorees, of course cnbc was an honoree, claude a yu golden, a professor of economics at harvard i asked her was it worth it. she said when the pandemic hit, she is an economic historian, she was thinking about unemployment rates in the double digits the first one beginning with a two, the first digit began with a two when you think about the inflation we have today that we're trying to get through and maybe what we avoided, maybe it was worth it we just got to go through the complication of getting it out today but maybe avoided a recession on the back -- in the front end. >> not to mention weekly jobless claims 166,000 week the lowest since 1968. to your point. >> how about that? >> yeah. all right. steve, thank you let's get more on the overall impact of what steve has opinion talking about and the markets as well we bring in mike santoli for

that a lot to sort of digest. cyclicals still continue to be weak as well, mike i know that. >> that has been a profound trend in the market recently it goes to this question, and i think it's the big one, have we now taken full account of what the fed is likely to do or what the clearest view of the next six months are arguably, we are far along in the process if not all the way there. the s&p 500 right now is trading right about where it did september, october last year we were thinking 2022 would have a half percent of rate hikes in it now we are talking about 2, 2.5% oil was at 75, 80 back then. we are absorbed a lot. it doesn't mean the job is done. it suggests that we are maybe at that point where incremental hawkish noises from the fed are not going to necessarily have that much of a pronounced impact the cyclical weakness reflects this market is haunted by late

2018, haunted by early 2016 when the fed was trying to get tighter at the same time you had industrial slowdown, downturn in recession. all those things are in the mix. all of them are reasons whey yo are probably not going to get a galloping risk appetite cycle going soon it doesn't mean that the market is going to be caught blindsided by this idea of tighter money in a slower growing economy. >> galloping i like that word utilities have been the second best performing sector year to date dow utilities hit a record not that long ago. even as we have seen this incredible volatility and moves in the bond market where yields are concerned, that seems like a flip-flop in terms of the correlations that we've seen in recent years >> right i think the defensive properties of utilities have won out over the relative yield story of course, dividend yields, utilities are still in a premium

to treasuries:i think the big question is, can you sort of acknowledge what the leadership profile of the market is without deferring to and saying, oh, that's all of a sudden predictive of exactly the way the economy is going to go i think you have to be careful because heading into january what was the trade buy the banks, buy the semiconductors, buy the consumer obstacles, all of it looked to be running hot and it didn't tell you how the economy was going to be shaping up in the months sin then. so take everything with a grain of salt. yeah of course, we get earnings kicking off next week. mike santoli, thank you. it's day two of the bitcoin 2022 conference in miami, florida. kate rooney is there with a look at what's ahead. hi, kate >> hey, morgan the bitcoin community is buzzing here on day two inside the conference crypto price are taking a hit. the lowest level since late

march and the high $42,000 range still outperforming some other major cryptocurrencies and the rest of the crypto market. analysts tell me this is very much macro related some of the same factors hitting tech stocks. higher rates, that's weighing on growth names as investors move out of some of the riskier assets and higher rates isn't great for the non-yielding investment like bitcoin or gold. there are some other headlines the crypto goals are pointing to though for one, the luna foundation shoring up demand by adding $230 million of bitcoin to its reserves analysts at genesis point to more conviction in the options market more interest in calls versus puts, meaning investors are looking to benefit from bitcoin's upside versus buying downside protection. ether, the second largest cryptocurrency, is bit more bearish. more demand for downside protection over on that side of the crypto market. meanwhile, inside at the

conference square cash app rolling out three new crypto features for one, automatic bitcoin investing. customers can allocate part of or their oentire paycheck into bitcoin. and there is fair change investing, surrounding up to the nearest dollar amount on transactions and putting that into bitcoin and then adding the lightning network, which lets people send crypto instantly jack dorsey, ceo of block, formerly square, has been a high-profile bitcoin believer. also on stage big-name athletes inside here. serena williams, aaron rodgers and odell beckham jr.'s. rodgers and obj take part of their sol alaries in bitcoin and cathie wood and peter thiel. >> we will be looking forward to hearing what they have so say. we know you will be bringing us those headlines. kate rooney. thank you. as we head to a break, a look at the roadmap.

elon musk breaking s.e.c. rules over his new stake in twitter. we will stus with former s.e.c. chairman. >> plus, my exclusive with citi group's mark shafir, cohead of global m&a the overall m&a landscape at post 9, and the regulatory environment, activism. and treasury secretary janet yellen speaking on crypto regulation, outlining five key principles we have highlights on that "squawk on the street," a lot more of it is straight ahead, so don't go anywhere. new projects means new project managers. you need to hire. i need indeed. indeed you do.

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it's a movement. with xfinity, it's a way better way to watch. global merger and acquisition activity fell 29% in the first quarter of this year tough comparison though. and now with a rigorous antitrust regulatory regime, not to mention concern about a global slowdown, well, what can we expect the rest of the year. joining me to help answer those questions, mark shafir, citigroup. good to have you here. >> thank you, david. >> first let's start off on the down 29. sounds like a big number but there are a lot of factors involved and why it wasn't that bad of a first quarter. >> it's a surprisingly first good%. that's off a $5.8 trillion market last year, a $1 trillion higher than -- it's a

$4 trillion run rate market and the fourth or fifth highest in history. we maintain this, it will be a very good market. >> maintain is the key point and there are any number of things that could put the brakes on it. let's start with regulatory regime we talk about it here. it came up yesterday in this jetblue potential bid. the doj not to mention the ftc seemed very much focused on even keeping companies from thinking about announcing a deal. are you seeing that, and if so, where does it play out most prom entally? >> there is a change in antitrust in the biden administration that's unequivocal i cwould say at this point duration of transactions, particularly large ones, things that touch the consumer, health care, technology, you know, pushed out 18, 24 months and beyond you are in a more uncertain environment. prospect for mega deals, 20 million and up in north america, is probably somewhat reduced because, look, it's unclear ultimately when this -- a number

of these cases get tried in court, which i suspect they will go to, particularly new approaches away from consumer behavior or harm standard to anti-competitiveness looking at market structures, bigness being bad. i think we will see a reduction in those transactions. we had a couple in the first quarter in north america but it's going to be lower. >> microsoft activision, for example. you think, i wonder, you think some of these companies will be willing to go to court they may be relying, the regulators, on perhaps legal theories that have not been tested. >> that's the question i think in an uncertain environment like this and what i'm seeing is a shying away from larger -- from mega deals at the moment that's not to say we won't see a few. >> a year and a half to two years and i have to go to court -- >> that's the argument what we're likely to see is transactions sub 10 billion, 3,

5, 7, you know, roughly under 10 that where i think is going to be the sweet spot in the market. particularly in north make we saw $60 billion transaction in india this week the big bank deal. so it's not to say that it can't happen i think it's certainly a higher standard that the board and the ceo level given the duration, given the posture of the administration and so on and to forth. >> so six to eight to 10 billion not small. private equity continues to play a prominent role today the only real deal i talked about was the cdk bill, $8 billion enterprise value. do you expect private equity to be active? and give me a sense on the financing markets. >> you have to look at a driver of the market is liquidity and by our count there is over $2 trillion of capacity in the private equity world at the moment and you got 2 trillion of

cash on corporate balance sheets that's a massive amount of liquidity. liquidity has a big impact on driving transparactions. sponsors 30% of the market in the first quarter. consistent to sly lower than th fourth quarter last year rates are going to go up that's going to raise the weighted average cost to capital. does that bring down pricing in some respects? you have seen how the shift away and the reset in valuations to some of the growth spaces. i don't see why at this point this is necessarily going to stop private equity. i also think we are definitely seeing in the corporate landscape sort of a resurgence in activity, not the mega stuff, but seeing things like 20% of the market were spins in divestitures last year so it's healthy at this point, david. look at the places that when you think about it, 65% of the market is north america, which is not unhelpful and secondly, when you look at where the -- you know, so who has done well?

volume is up in the quarter. you know, it was tech, it was believe it or not real estate and power, industrials, health care, coms, energy were down maybe resurgence in energy given what has happened in ukraine. >> let's talk about that there is a lot of concern about geopolitical and economic factors right now, what it's going to mean particularly for the second half of the year. hard to know is anybody saying we are going to step back and wait? >> clearly, there is more cautionen. i think people are looking it's difficult at this point do you believe we will run into a big recession, severe recession or is it going to be softer, a soft landing, is not a trivial exercise for the fed do you believe that we are in a prolonged conflict and that people will adjust to that notion in similarly -- i heard mike's commentary. the equity market is holding well i think we will see more

volatility without a major disruption in the capital markets, financing markets are good, the grade market is wide open, large finance market good, tougher in europe but still in the u.s. there will be more risk and that has to get priced into the trans abcs. >> one thing there is not as much of is spac activity that had an impact on the year over year first quarter numbers. a year ago they are counted as mergers, not ipos. >> north america is the big spac market 29% down as you have it. when you strip out spacs, the market only down 20% year over year i'm relatively sanguine about the prospects. it does seem to me the equity markets volatile, think it will hold in. and i think it will be a decent environment for m&a, the corporate -- again liquidity is a big driver of this stuff. >> you are trying to be positive -- because you are not -- if the viewers know after

all these years, you are not a huge promoter. >> no. look, activism is an interesting space as well. >> i want to talk about that in the time we have left. universal proxy access is coming. >> yes. >> i think in the fall activism could be changed as a result we will explain what universal proxy is, maybe you can help explain it and then why it may matter - >> so essentially the dissident slate and the board slate will be on the same card. so what does that mean it actually gives the investor base and the proxy advising services the ability to pick from each column, the best slate. the reason i think that's -- >> as opposed to the case now, it's two separate -- >> cards. >> and the costs are higher. >> it will be cheaper. you still have to get to two-thirds of the investor base, you have to mail it's not going to be terribly expensive. what does that ultimately mean there is a higher probability -- the boundary conditions you think about proxy fights, you

get no directors, you get a complete slate i think those are likely to be off the table. what is interesting is the higher probability in this situation is will get a board seat, right? i think it's less likely complete slates. investors don't like to turn over a board typically in one election what does that mean? it's not just the activist play. you think about the preparatory resolutions around esg, right, social activism. sometimes in some cases 15 to 20% of the vote, but it's preparatory. here you have a director or two elected to your board. that will -- >> because the cost is coming down enough that it's -- whatever it might be, it's not an impediment to them putting -- >> i think it will be very -- you could fundamentally hang -- look, potentially. not until september this is implemented am i think it's kind of interesting the activists are flush with cash we are also seeing, you know, the interesting piece about

spurring deals is kind of hedge fund or activist, private equity, getting into the private equity space that's not unhelpful to what we do. >> mark, always appreciate you taking time with us. great to see you in person in a suit. >> just for you. >> appreciate it like even dress shoes. wow. all right. mark shafir. morgan. it's fbeen great a quick break. chinese tech stocks firmly in negative territory today as volatility continues in that space. j.d..com also lower an announcing the billionaire founder will step down as ceo but marein on as chairman. we'll be right back. stay with us re-entering data that employees could enter themselves? that's why i get up in the morning!

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. welcome back to "squawk on the street." it is now time for our "etf spotlight. today we are taking a look at the pro shares online retail etf ticker onln. down 1%. down 20% this year, rebounding the last month in general, up 8% wayfair reversing early losses today as wells fargo downgrades

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♪ welcome back here is your cnbc news update at this hour. michigan governor whitmer is going to court to protect abortion rights. she is asking a state court to recognize a right to abortion under michigan's constitution. she is also seeking to overturn a 176-year-old state abortion ban that could take effect if the supreme court roe v. wade ruling is thrown out at the high court level.

in puerto rico, a massive blackout continues to spread tracking site power outage says more than 440,000 customersout electricity after a fire at a power plant last night utility officials are trying to complete repair work within 24 hours. in shanghai, health officials are ramping up testing to combat the covid outbreak there. thousands of medics are being brought in from across the country. some residents are struggling to get food with online grocers often sold out anti-covid restrictions are confining most of the city's 25 million people to their homes. and in brussels ukraine's foreign minister meeting with the nato counterpart he urmed the alliance to provide more aid and said his agenda is simple it's weapons, weapons, weapons morgan, become to you. >> eamon javers, thank you. now turning back to the markets. it's been a mixed picture this morning. yesterday we heard from goldman, warning u.s. equities may have

5% upside the rest of the year our next guest says even though there may be little upside in the short term, the recent rebound is, quote, more rational than it might appear goldman sachs global equity strategist, peter oppenheimer. great to have you on, u.s. equities counterpart was on yesterday. give us -- that was domestically focused. today give us the world's view your global outlook, especially given the fact that we have raging inflation, we have central banks around the world, perhaps ex-china tightening now. covid continuing in certain areas of the world and of course, geopolitics. >> obviously,. as david said and we agree, the upside is not very significant from here and we long believed that this cycle would be what we describe a relatively flat, a wider trading range with lower aggregate returns than the last cycle that was driven largely by interest rates falling

that said, despite the huge change in inflation expectations and interest rates and the war in europe, there are some rational reasons why equities overall have been holding up quite well firstly, let's recall that real interest rates remain negative in most places and that's encouraging investors to move away from normal assets towards real assets. of course, because corporate balance sheets are very strong and payout ratios are quite low, the dividend yield is effectively a real yield dividends will grow and earnings will grow with fwd over time that's an important support. finally, i would say that equities relative valuation still looks quite good even absolute valuations like -- ratios have come down a long way. outside of the u.s., well below the long run averages now. >> if you look around the world and across some of these markets, where would you

potentially be investing for that dividend yield? >> europe is a good area with high and stable dividends. in the last cycle, although interest rates fell to zero or even below, generally investors shunned dividends because they saw them as being effectively a part of a value trap generally in companies or sectors where the dividends were not sustainable. that's fundamentally changed as we've started to see higher nominal gdp, higher inflation, and that's benefiting some of those sectors which were previously hampered. and so europe is a good place. but i would say being more geographically diversified than perhaps many investors have been in the last cycle is likely to pay off. and we find, you know, high-end stable dividend yielding companies across the major regions and with focus on that and stable margins as key drivers for the cycle.

>> peter, why do you think more geographically diversified is something that will pay off? >> well, again, if you look at the period after the financial crisis, the decade or so after that, equity markets really became bifurcated by factor because of low nominal gdp and the falls in aggregate demand after the crisis, of growth of the scarce people paid more of it that was encouraged by interest rates fall to record low levels. a lot of that growth was in the technology sector and mostly in the u.s. as we move forward in time, we would say two things firstly, markets are likely to be less split by factor. it matters less whether you're seen to be in growth or value, but really the sustainability of balance sheets, cash flows,

dividends and margins, and that may be true in different sectors from technology to energy, for example. and so the sector biases that trove drove the last cycle are less obvious. the second point is relative valuation. you look at em, china, europe, these are areas where valuations have fallen below the long run averages the u.s. is still above the long run average. there is good reasons for that but as you start to look at ways of diversifying to generate returns in a lower aggregate return environment, being more spread geographically makes sense to us. >> i want to get into em more specifically with you because you do have a strengthening dollar which is expected to stay at these levels, maybe strengthen mover as we have a fed continuing to tighten aggressively in the coming months on the other hand, many of these emerging markets are tied to commodities which are at

multi-year even record year highs in terms of prices so how do you navigate it? >> well, i think that you're right, that there is some big headwinds for emerging markets in aggregate they tend to do less well in environments where global growth is slowing, dollar is rising and u.s. rates are rising and also the geopolitical dynamics that we are seeing playing out at the moment, the risk premium across many emerging markets and that, in e in effect, means they should be cheaper much but i think again emerging markets are not really a homogenous asset class at the moment you quite rightly say some are commodity producers. some are big commodity importers. and that is an axis which is differentiating returns across that space generally speaking, we see some good value ray crosacross the developed markets with premium

to globization, that will be a relative negative in some emerging markets as well we shouldn't forget a lot of well placed to service the requirements of richer countries in terms of energy, security, and commodities as we move forward in time. >> peter oppenheimer, goldman sachs, thanks for joining us today. >> thank you treasury secretary janet yellen calling for more crypto regulation ea >> ginnie mae, she will outline a cautious and skeptical approach for reviewing and regulating digital assets. she warns that innovation that improves our lives while appropriately managing richb should be embraced but also be mindful that financial innovation of the past has too often not benefitted working families and sometimes has

exacerbated inequality, given rise to illicit finance risk and increased systemic financial risk she highlights thpotential for crypto to speed up payment systems and reduce costs but says it's too early to tell if that works for normal users. if it happens, it will take years to develop, not months finally, on sanctions she didn' address whether crypto is going used to evade them, but said it is illegal to avoid sanctions or launder money using any financial instrument on that note the senate now has the votes it needs to pass a bill that would end normal trade relations with both russia and belarus. that vote is ongoing, but it comes after an impassioned plea by ukrainian president volodymr zelenskyy directly to members of congress to turn up the pressure on russia. the senate has been haggling over this bill for weeks, but finally now it does have the votes to pass.

republicans and democrats coming together on this once it clears the senate, it will have to go back to the house. word is also expected to pass with bipartisan support later today of guys. >> thank you. still to come this hour, former s.e.c. chairman harvey pit weighing in on elon musk's new twitter stake. plus, check out shares of occidental petroleum, upgraded to overweight at piper sandler, analysts saying they believe we are in very early innings of a multi-year stl for cycle price target doubles from 44 to $8 maybe a bit late on the call stock has already doubled this year although trading below 57 don't go anywhere. wel rhtac'lbeig bk. n. the pursuit of outperformance at pgim. with deep expertise to outthink across multiple asset classes, actively managing investments in the world's public and private markets. outscale, with the resources to serve 1,500 clients in 52 countries. and outlast, with long-term conviction

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welcome back spacex facing regulatory pushback this week the u.s. army corps of engineers withdrawing the application for a starship facility, citing

failure to provide environmental information. spacex with reinitiate that by providing info requested this as elon musk's company we awaits the outcome of a key environmental assessment and license from the faa to move forward with the first orbital test flight of starship from texas. you can read more about that on cnbc.com but speaking of rockets, a big week for some spacex competitors as well. after amazon unveiled a multibillion-dollar special launch deal with three companies to loft its planned project kuiper satellite megacon stellation project now, i spoke with the ceo of one of those rocket companies, united launch alliance, whose up and coming rocket, which is to be powered by blue origin engines, is poised to do launches 38 over five years for amazon here is what tori bruno told me about that record rocket deal

from the space em poseiam earlier this week. >> it's going to fly later this year and then after a few flights i can't say how many, because amazon isn't releasing exactly when they start, will begin flying their missions on vulcan >> no word yet on cost to launch either amazon's not disclosing that but you can expect that deal with be worth billions of dollars. vulcan recommendation ula's transition from the workhorse atlas 5 which relied on russian built rocket engines i asked how his company has been impacted by the war in ukraine as russia has halted the motors and the sanctions of the u.s. >> we started vulcan in order to both meet the new requirements that were coming but also to be able to retire the rd-180. although i, obviously, could not foresee the invasion of the ukraine, it has been clear to me

for a number of years that the relationship between russia and our country was not on a good trajectory so when i had the opportunity to accelerate delivery of the rd-180s i did that and i have all the engines i need to fly out atlas in a warehouse in alabama. i have had them there since last career. >> while the deal at amazon is commercial in nature, the growing number of satellites in general in space has been matched with a growing number of threats and competition which ula as a defense contractor is in a unique position to meet according to bruno we got into that evolving threat, what it means for the trajectory for space investment as a part of defense spending and so much more, including the history of those russian rocket engines and oosthuizen national security missions. all on my episode of the "manifest space" podcast which is out now wherever you get your podcasts david. thanks

let's give a quick check on those markets. we're down, yeah, down down we're back after this.

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welcome back to squawk on the street stocks are drifting lower this morning and right now at session lows for the s&p 500 down n nearly .5% one of only two sectors in the green, it's still tracking for a weekly gain. leaders include lamb weston, constellation earnings did fall short of expectations. then costco firmly in positive

territory after better than expected sales growth in existing stores in march that stock trading at an all-time high of 2%. morgan, costco, big box, bulk buys, inflation fighting. >> that's right. thank you. we've got a big show next hour including an interview with billionaire investor orlando bravo. that all starts in about ten minutes. we'll be right back. stay with us

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elon musk has that new stake in twitter but will the sec step in and butt heads once again with the tech executive? joining us the former chairman of the securities and exchange commission harvey, he filed this as a 13 g. he was in conversations with the company with the board about sitting on the board and he benefitted perhaps even just from being able to buy the stake

at a lesser price than he otherwise would have with more rigorous standards in terms of letting people know about it what are your thoughts and what will the sec be in a position to do about it? >> think the disclosures and forms that mr. musk filled out were deficient as a matter of law. he was interested in a board seat he was interested in changing the direction of twitter he's made a lot of comments to that effect. so his initial filing, which was just that of a passive investor, was an erroneous filing. he conceded that by filing the correct filing, but he filed it very late. now, in the usual set of circumstances, these disclosure issues are not, shall we say, earth shattering events. but when you're dealing with

elon musk, everything is an earth shattering event because he's gone out of his way to attack the sec and to effectively bait them into coming after him, which he's done quite successfully. in this case, it seems clear he violated the law he seems to have acknowledged that he violated the law it's very possible that the sec will go after him for that >> you think so? again to your point, it is now a d, which it always should have been a 13 d and we should have learned about it on march 24th ten days after he crossed 5% what can the sec really do and do you think they're setting up to potentially battle him given he seems to almost want to bait them >> in the scheme of things, these types of disclosure

violations aren't the most earth shattering therefore, it's not clear what they would do other than go after him. but they're also looking at him and his brother for potential insider trading. they are dealing with his request to the courts to lift the agreement he made with the sec which is kind of bizarre he agreed to this and now he doesn't want to be bound by it if he didn't want to be bound by it, he should have litigated or refused to accept the consent decree, but he ultimately settled and now he doesn't want to live up to his contractual undertakings. >> i do want to shift gears and

get your take on this report that the sec is now investigating how amazon disclosed business practices, including the company's use of third party sell ers' data and what that means in terms of a regulatory probe because there was so much broader scrutiny now. >> i think we're seeing a very different attitude on the part of government and legislators toward big tech. amazon is right up there as the biggest of the big tech. what amazon has done here is bizarre. they conducted an internal investigation but they won't release the results of that investigation. that makes absolutely no sense either they didn't violate the law, in which case they ought to indicate that, or if they

stubbed their toes and they did some things wrong, they should acknowledge that and say here are the things we're going to do to avoid having this arise in the future and to remediate for any injuries we may have caused. but trying to stonewall this is, in my view, absolutely the worst posture that a public company and one in big tech can take, especially at this point in time >> harvey, always appreciate you taking some time and sharing your insights. thank you. >> my pleasure >> harvey pitt with that we're close to the end of our show. the markets haven't done too much we did take a leg lower about a half hour ago, plenty of concerns out there would note that the pharmaceutical industry is benefitting, as you might expect

in a market like this. merck and pfizer bmy lily up nicely. >> it goes back to the conversation we were having about name like costco that's going to do it for "squawk on the street. "tech check" starts now. ♪ happy thursday welcome to "tech check." carl is on assignment today. we will break down the move and how it fits with berkshire's other tech invests investor dan niles with us this