headline a couple of them from elon musk. this time the tesla ceo deciding not to join twitter's board. china selloff. stocks dropping 3% over covid lockdowns and data showing the country's producer inflation surging. congratulations to scottie scheffler. the 25-year-old slipping on a green jacket after winning the 2022 masters really from start to finish. never much of a doubt. especially after number 3. it is monday, april 11th "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 joe kernen and cirque du soleil cirque andrew ross sorkin the nasdaq is off by 100 points right now. down 108 if you are looking at this for the year to diet, things are looking good for the s&p and dow. if you start moving beyond, nasdaq down 14%. transports down 20% from all-time highs it is now in bear market territory. you have the russell 2000 down 18% from the all-time high there are pockets feeling it more than others large part of that is treasury yields they are up significantly. you will see right now the 10-year yielding 2.2.75%. 30-year at 2.76% and chinese stocks dropping 3% on hot inflation data

producer price index up 3.8% both numbers were higher than had been expected. the data comes as china fights to control its latest wave of covid cases. there are strange things happening there. oil prices right now wti is off to $95.77 now to the corporate story soap opera whatever category. elon musk is not joining the twitter board. the company's ceo making the announcement last night. musk is the largest shareholder. the company remains open, he says, to input the statement parag writes we believe having elon as a fiduciary of the company where he, like all board members, has to act in the best interest of

the company and all shareholders was the best path forward. you can read between the lines the news musk joining the twitter board came a day after disclosure of the 9% stake of the company. over the weekend, musk tweeted how he wanted to change the social media company and the twitter blue subscribers pay with dogecoin and authentication check market and keeping twitter blue free of advertising suggested the homeless shelter for the san francisco headquarters because no one shows up anyway. that got a response from jeff bezos. amazon chairman now. he thought it was a great idea sharing a similar story of the similar initiative at amazon here's the thing i would say two things i think

first, we talked about how he would become the ceo or take his ball and going home. certainly it may not be over the question is if you think this is a hostile bid and tstil try to take the company over >> he is not a board guy he wants to be -- if you are a board guy, you have to be civilized. what stays in the board room >> he is running a poll over the weekend. he wanted to remove the "w" from twitter. >> he could not do that. >> i wonder if if hhe he had top

tweeting. >> i am a free speech absolutist. >> you can't tell me what i won't post he didn't have the problem with the 14.9% cap. i'm okay with that it was later he said, you know, maybe not. >> that's why with the stock down, i'm not sure -- i can't tell if the stock should be down >> i don't he will sell the stock and go away. >> as you said, the ceo is walking on egg shells. we would have liked to have had him, but welcome >> he had to act like a first down in other words, i think there was i'm jumping and going home. >> you want me to be quiet >> push, push. i through a couple of phone calls had to be made >> more of an activist he wants to be a outsider, not

an insider when he doesn't like what inn s inn insiders turned twitter into let's bring in dan ives. dan, six months from now, he owns more or less or zero? >> i think he will own more. i think fundamentally, he was not going to stay quiet. that is something the twitter board over the weekend wanted him to do. now he gets more hostile and more active. i think now this is more of a "game of thrones" rather than the board collaborating with ideas. >> it could turn into a food fight. >> i think a food fight is just the start. he ultimately came to shake up twitter. joining the board was not going to be what he thought it was

i believe this is where he gets more active. he owns more twitter this is going to start a more hostile situation at twitter now to get out of the popcorn time the shareholders are figuring if he goes more active and partner with private equity to try to change the slate clearly over the weekend, that was the fork in the road >> he was almost questioning the business of twitter. how many bots are there? the important names. i'm not tweeting much. >> and somebody tweeted out a video of the interview i had with carl icahn. he talked about firing 12 floors of people at one time. he responded to it and wrote exactly. meaning that's what i'm doing here >> i can't see elon at the board

meeting. we read the minutes. vote on. elon would be like -- it was never a good fit unless it was his own company. >> this reminds me of hertz and fields said we're ordering these teslas and theurned into the ba and forth. you are not getting a discount you think you can corral him and you can't. he is an independent free spirit you will not make him do your bidding or sound like you have a good play. >> he is dangerous he is mercurial and everything else >> dan, in terms of the stock and in terms of guessing, you guess he goes hostile. what price is this valuable to him which might be a different

rational or irrational price if he does it with private equity, he has to be rational to some degree. we talked about egons on the board? can he team up with elon i think some of the filings and legal structures look scarce >> i think it could cause dissension now he will start to -- he could only go 14.9% and now he can go as high as he wants. when you look at the stock, it comes down to does this end with a selloff of twitter is there a change strategically they can do? i think investors are viewing this as he goes hostile and

active instead of musk in the boardroom in the corner just agreeing on certain board decisions, now he goes to the point and we see if he will be more hostile. >> what is the rational value for this company >> i think you start to get to$. that would be as many would view it as they ultimately sold the company. strategically if they changed from advertising perspective we know over the last week, the reason the stock is where it is is because of musk. now no longer on the board becomes the original option. it wasn't a cinderella story where he is on the board and

they hug and go to dinner. now it is "game of thronesethrod which way does he take it? this is clearly an unfriendly situation. >> dan, if it turned out he did take his ball and go home, if there was no elon here and sold his stock and said forget it, then what is the value of the company? >> the stock has a 3 in front of it that's why investors are going to bet does he ultimately view this as a game and go home i think it comes down to he is viewing this more strategically and a platform i don't think he will drive this from a hostile perspective and increase the stake and become more active. from a tesla perspective, you have a supply chain issue.

shanghai in terms of the shutdown you don't want a tesla investor soap opera side show >> you think his interests are aligned with shareholders? does elon want to maximize shareholder value or maximize free speech public forum for twitter? >> i think it is more the latter >> make it less valuable it is not now. >> that's the question you can go down the free speech hole in terms of what musk wants to take it from the value perspective, it comes down to subscribers and t advertisers. this all starts to cause a firestorm in how you do that is he aligned with shareholders

on a saturday and over the weekend as he was tweeting this caused a virus this is not someone who with will stay quiet. anyone who thinks he will sit in the corner and eating cheese and crackers at a board meeting was pretty delusional. >> dan, if this should have a 5 in front of it, the stock, if he is involved and getting more deeply involved, then it should have a 3 if he is going away do you know the filing guidelines >> i will know probably over the next 7 to 10 days. that is the question the next filing. does he increase his stake that's really where this goes to the fork in the road for the twitter stock and hearing from

musk >> all right thanks for the quick response. >> as the world turns. >> did we wake you >> i was still on the high of scheffler winning the masters. >> man, why did you have to do that how about rory andmorikawa that will never happen again i think that is where it is mystical it reminded me of "the natural." i heard weird violins. god had something to do with that you don't do that. you see rory's shot? impossible then to follow it up >> 8 under sunday at the masters. >> collin. my guy he didn't win. all right. thanks, ives

when we come back, the state of the american consumer and how higher prices are starting to hurt pocket books and potentially stocks too. let's check out theners andi the s&p. stay tuned you are watching "squawk box" and this is cnbc >> announcer: this cnbc program is sponsored by bdo. people who know, know bdo.

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the pandemic has shaken retail in rise in online shopping now inflation is taking a bite out of consumers pockets we have jim joining us jim, inflation numbers we get new numbers this week they are expected to be hot. is the consumer feeling it or is the consumer still flush >> right now, the consumer is still flush. we will see 8% plus this time when we see the number it is still going up so far. so far, the consumer has been resistant. not resistant to price the supply chain is still not fixed. they are sitting on 3$3.8

billion. >> part of the reason they were spending is they were not spending on services or vacation people are getting back out. going to concerts and doing other things as the competition heats up for the dollar, will retailers feel it >> they are feeling it in some sectors. not the housing part or home goods part as we were. surprisingly, the apparel, accessories and shoes have stayed strong and look like they will be strong through the end of the year. everybody going out to do stuff doesn't have anything to wear because they have not bought anything in two years. they did not buy in the fourth quarter. they still need clothes. that's been very strong. i think it will stay strong through the end of the year. experience has to start cutting in to the other side of the things >> what are people doing in terms of being willing to go

back into the stores traffic has to be up sharply >> traffic is doing well traffic improved just recently we also saw strength come back we saw sales wiggle around a little bit for the last three weeks. strength came back last week we haven't seen consumer pull back as nearly as we can tell at this point in time i will say we are trending are toward luxury goods and shoes and apparel away from harder goods like home stuff and trending toward experience they are planning vacations and those are happening. that is working with the apparel side what we will see is the spending, but everything happening at 3.6% unemployment and more people back in the work force with 60% people back in the office the best cities are at 60% they are not spending as much on gas as you think

they are also tending not to go to the store on those extra trips. despite that, the strong return to the store if we start to see the office pick up, we we would see strongr spending everything is work in the consumer if you manage the supply chain and a strong retailer, you can win the game they are not stepping away product over price. >> the ones who have done well according to the numbers are the big box retailers. target, amazon, walmart. is that who continues to lead the way or is another segment taking off >> no matter what happens with the stocks, those are the companies that are leading the way as far as doing the business and giving the customer what they want and easy to pick up at the store or curbside. those guys have put a lot of

money into it and doing it well. on the other hand, you are starting to see things like macy's with strength among that middle of the regional department store world customers are coming back to buy the stuff they sell. dressing for events is picking up you see louis vuitton and gucci. the other thing is happening smaller players with niches like boot barn or lululemon has strength the decentralization going with everybody moving to the such b suburbs. that hasn't changed. funny niches working out because of the lifestyle >> that is my favorite mug tractor supply we will watch the inflation

numbers come we appreciate your time today. >> thank you coming up after the break, airlines preparing for a record wes er travelcarriers, that mean fer flights. not more stay tuned you are watching "squawk box" on cnbc ...helping us all move forward financially. pnc bank: see how we can make a difference for you. this is hannah, she's a posh virtual receptionist at the ready 24-7 to answer your calls and assist your clients. you can't be in two places at once. let posh answer. posh virtual receptionists.

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they prepare for a spike in summer travel demand i hate to sound like a broken record we all taxpayers gave you airlines so much money and the purpose of giving them the money was to serve the american public that was the goal. that was the point >> not the utilities >> you are a utility if you take taxpayer money if not -- this is what is happening. >> they have to -- >> trying to run a business and hire >> we don't want them to get back in the same position because they are an essential part of the economy. live with it. >> live with it? so shareholders can make a a fortune and executives can make a fortune at our expense and the american public which is supposed to be sitting on those claims i don't know if you were that, you might say it is our duty, which they said

they had a duty to the american public that's why we gave them the money to keep the planes in the sky. >> how long does it last this is different than too big to fail. >> you hate to mention it like a broken record? what would satisfy you what do you want them to do? >> very simple very simple. don't reduce flights don't cancel flights outright. go to an airport and see what is happening. >> don't run the business like you used to run it. >> is that in perpetuity >> not within 18 months of taking money from the government because you argued that you were the sole industry in america that needed a special deal relative to everybody else in the world. >> what about restaurants?

if you took money for ppp, should you not rise prices as costs go up? >> that's not what we are talking about here i have a bizarre sympathy for ra restaurants and everybody else they asked for a specific program and argument ceos came on air and union officials same on air. we gave them a special deal because they said they were a special part of our economy. one of the things you see happening now to americans, taxpayers, who paid for them the reason -- >> the big stake like banks? >> we had this conversation with steve mnuchin at the time. we didn't get a stake in the airline. >> they didn't do anything wrong. >> correct the point was you were supposed to take the money and really invest in the company. what you see happening is they

are not doing that at the pace they are supposed to >> the money we gave them got them through six months and kept employees on and it ran out. is that when our leverage over them should have been? >> we have no leverage clearly. zero leverage. >> the question is it's a year later and the money is gone and ran out. can we continue? we don't want you to raise prices. >> these were companies that argued at the time they would have gone bankrupt they would not have existed if it was not for the taxpayer. then the question is what is the appropriate profit margin to take at this point and how should they operate that business should they cancel flights removing flights they are doing that and not actually cancelling them like now? >> i think you don't get to

merge. >> that's a separate issue that's a separate story. i agree with you when you get to jetblue or frontier. >> no more mergers because it cuts into competition. we don't want that i understand that. >> anyway, anybody who with spent a day or two at laguardia or jfk they know. becky, what is the exciting news we have exciting news. introduce you to the new member of the family. david evans and his wife welcomed a baby boy last week. john cooper evans was born at 5 pounds 12 ounces they will call him cooper. he is spending a few days in the nicu until his lungs are ready for primetime. mom and dad are excited to bring him home that will happen in the next few days he made progress where he is off the original things they had on his lungs. now he is just getting the

oxygen that comes straight through. we wish them the very best for the new member of the family way to go, cooper. we can't wait until everybody is home >> good-looking kid. we all know food prices are going up why some of the major events impacting your gce bl. at nt.roryil >> announcer: executive edge is sponsored by at&t business at&t 5g is fast, reliable and secure including the iphone 13 pro with 5g. that's the one with the amazing camera? yep! every business deserves it... like one's that re-opened! hi, we have an appointment. and every new business that just opened! like aromatherapy rugs! i'll take one in blue please! it's not complicated. at&t is giving new and existing business customers our best deals on every iphone. ♪ ♪

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welcome back several major events going on putting pressure on global food supplies and sending prices higher kristina partsinevelos has joined us this morning to tell us about the latest on how bad it really is how bad is it? >> reporter: it's bad. many have never seen food prices this high in their lifetime. in february, the u.n. food pricing index soared 13% that is the highest level since 1990 of 1990 we know russia's invasion is to blame. the black swan or unpredictable

events plaguing your dinner plate. there was hog disease that is shrinking herds in mexico. they are turning to u.s. pork supplies that is driving prices higher. exports to mexico climbed 33% year over year you have lean hog futures climbed over 20% just this year alone. all while farmers are shrinking herds. animals are getting expensive to feed that is because you have a surge in grain and fertilizer prices related to the invasion of ukraine by russia. you have chicken and dowgrading tyson. you have bird flu. that is sweeping the nation. forcing american farmers to kill hens and slashing the supply of eggs driving prices up 44% compared to last year keep in mind, the easter holiday

adds to the dedemand you have up swings in prices cal-maine foods. then, are you thirsty? the department of agriculture says the citrus crop is expected to be the lowest in 15 years there was an invasive insect disease to damage florida orange groves which sent prices up 16% this year. according to the usda, they are warning it will get worse as companies move on to two and three rounds of price hikes. andrew >> thank you for that report i don't want to say thank you, but thank you for it the latest cpi data on food is

expected to come out this week it is expected to reflect the rise in trends joining us right now is carlos gutierrez. he is the founder and former kellogg's ceo. >> good morning, andrew. >> is there a fix? anything you see on the horizon to improve the situation >> not in the short term i think something to watch and interesting is who can raise prices and who can't and who has pricing power and it is not the same across the board. some companies will be able to take pricing and some companies will suffer because of it. frankly, this is when all those years and billions of dollars of marketing will payoff. >> let's talk about those companies. which companies can raise prices in this environment? also, by how much?

is there an upper limit at this point? >> i think you want to cover i hope inflation, right? if you cover inflation, you stay as you are i don't think companies are looking to expand margins at this point if you cover inflation, you can stay pretty much the way you were before. if you don't cover inflation then, you go into a spiral you know, we talked about margins before and how it is important to protect margins we are talking about one margin which is gross margin. if you don't protect gross margin, you can't continue to in invest i would keep my eye on companies with the higher gross margins. to tofocus on operating marginsa trap sometimes they can get so high that you no longer have any room between gross and margins to invest in marketing.

that is a function of years and years of ramping up earnings, double digit, top line growth of 1% or 2% you will get margins ramping up to the point where you need a reset or stop investing. >> we are looking at a chart of costco which is doing well kroger doing quite well. we had conagra in the red this morning. how do you look at those companies and then on the other side, given kellogg's, how do you look at pepsico or coca-cola? >> those are brands that competed, soft drinks, competed a long time on pricing you take away the advertising and you lose something price promotion works better when you have a strong brand it is interesting. there are consumer trends and health trends.

you mentioned snacks salty snacks one of the products in those companies. salty snacks have done very well done very well during covid and before covid they were bucking the health trend. they have outstanding marketing and distribution that is second to none. unless you have differential and a brand, this is when we will see who has the stronger brands. i would start by looking at gross margin if you just stack up food companies with gross margins, the one with the lower margins will be the ones that have a tougher time increasing prices >> 12 months from now across the board, there's margin compression or people hold the margin >> i think margins will re

regrettably decline a bit. especially gross margins a headline inflation is 7.5% that doesn't mean companies are feeling 7.5%. when you look at packaging costs and grain costs and ingredient costs, you will get more than 7.5% you will find companies with lower gross margins. they want to be brands so you got to get the gross margins up or invariably invest and hold investment in marketing or let your ebit margins decline. you will have to drive discipline into the system with margins tight and interest rates increasing, you get a lot more discipline on working capital and inventory and cutting out unnecessary skus

that are small and clutter things this will drive discipline also some cost reductions. people say don't take up pricing. it is unfair the unfair part of that is if you don't take that up, you have a lower cost and inn that means taking out people. we have a kwquandary we talk about private labels brands should not compete with private labels they will lose their game is value and marking. it is an interesting time. some companies will flourish >> it is interesting to watch, carlos we always say a longer conversation we hope to continue it with you. >> thank you. >> we hope things improve. discipline is the word of the day. thanks, carlos >> good to see you thank you. coming up, shares of chinese

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welcome back we have been watching the u.s. equity futures there are red arrows dow futures down 64. s&p down 20. the nasdaq which is down 136

right now. in the headlines, shares of nio dropping today the company is raising prices and suspending production. this comes as nio and others deal with the covid cases adding to supply chain issues stock down 9% right now. coming up, we will talk big money behind the masters th'schpish at right after the break new projects means new project managers. you need to hire. i need indeed. indeed you do. when you sponsor a job, you immediately get your shortlist of quality candidates, whose resumes on indeed match your job criteria. visit indeed.com/hire and get started today. this thing, it's making me get an ice bath again. what do you mean? these straps are mind-blowing! they collect hundreds of data points like hrv and rem sleep,

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welcome back to "squawk box" this morning take a look at oil prices right now. 94.83, now down a bit, 3.5%.

brent crude, about 3%. a couple of stories we'll be watching this morning. continued covid lockdowns in china and a release of continued strategic reserves we're focused on both of those issues but we're also focused, joe, on postmortem of the masters. >> 25-year-old world number one scottie scheffler winning the masters by three strokes, never really close most of the coverages with focused on tiger woods' comeback he made the cut but had a rough saturday, finishing in 47th place plus 13. joining us now is our sports business reporter. tiger was good he was there every day he looks like he minimized the amount of pain and how difficult it was for him to get around the course it started being kind of clear i think if you're in pain, some of those putts that tiger needs

to hit and has hit his entire life, i don't know, that wasn't really his long game that really let him down, right, jabari? but it was great watching him. it had to be a triumph for him to just be there and make the cut. >> good morning, joe you're absolutely right. tiger woods, he returned his first masters 25 years ago in 1997. it was good to see him play. the tv viewership when you talk about the dynamics of how they pay the masters, i don't think they pay anything, but tv dynamics, they went from a 2.8, 28% increase 3.5 million viewers on friday, an average that's because of tiger woods. i missed my new york train on friday because i was watching tiger hit birdies and throughout the weekend i'm still tuned in because of tiger

i'm watching scottie scheffler pga won in total because of tiger woods. listen, scottie scheffler, cam smith coming down on the last round yesterday, rory hitting that big shot in the 18th to end it, taking over second place it was right down -- right down to the end it was thrilling. it's the most i ever tuned into the masters after tiger was out, and i'll tell you it was fun to watch. now that he's committed to the open, i think that's good. this is good for golf. golf needs tiger woods last year we were talking about brooks and bryson. they didn't even make the cut. i love scottie scheffler it's a great story my 8-year-old daughter was even on the couch watching golf with me to the very end and knew what the green jacket was i was shocked. it's because of tiger woods. and i like scottie scheffler too. it was a great weekend for golf. >> jabari, in previous years, i

always thought augusta was kind of -- they didn't let 1 through 18 -- you never really saw that, the entire tournament. this year i did. i think it was espn streaming, i got to watch individual groups or four, five, six hole. i've never seen as much of the masters as i saw this year was it different was there more content available, and does that mean more money >> you know, i don't know how much money it means, but it definitely means more engagement if you're engaged in the sport, it's only going to help the sponsors, at&t and ibm at&t did a wonderful job i was tuned in the masters website did a very good job i can watch the holes i missed and see them make their shots. listen, we talk about the nba, mlb, nfl, wnba all year round, but i don't think enough credit

has been given to golf and what they've done with their sport. you can watch golfers throughout streaming on your very phone, on your apple phone from an engagement point, i was tuned in my 8-year-old was tuned in with me i want to give them credit, pga. they won this weekend, not only because of tiger woods but because of what you said, the engagement and innovations around the sport. >> it's the very beginning of baseball, but it's playoff time for the nba. when guys really want to win, it means more money for guys, this is when the a-game -- this is where people come to play. that should be good too. >> yeah. you know, listen, the nba, they have a great concept around their play-in. we'll see what the long-term future of that s but it gets people talking about their sport. 75th anniversary, you can say what it was. i don't know how exciting it was. to me it was boring.

there were a lot of issues kyrie irving not getting vaccinated but the fact they get to lobby and play -- i mean the brooklyn nets, we thought they weren't going to be there. it's good for the nba product. you want to see people excited about the pole season. at the same time, i love the play-in. >> all the teams you want in are in it seems like, jabari. >> except for the lakers. >> we're late. we'll be back soon soon, at some point.

good morning a 180 from elon musk one week after we learn head was joining the board of twitter, news this morning he's not joining the board. another chinese mega city tightening covid restrictions on just a few dozen cases reportedly dr. scott gottlieb will join us live. and is it time to go pc? in this case it means price controls with prices surging, we'll have a debate with a couple of heavy

hitters. the second hour of "squawk box" begins right now ♪ good morning welcome to "squawk box" on cnbc. we're leave at the nasdaq times square site. i'm andrew ross sorkin along with becky quick and joe kernen. we're going to talk market inflation. we have our former s.e.c. chair jake claden who's going to be joining us as well u.s. equity, red on the screen, off by 25 points, nasdaq off by 105 points the treasure yeah yields as we watch to see whether it's in

standings. we're looking at the ten-year. 2.759. the 2-year, 2.580. some other zbik stories, twitter shares, they're lower this morning. that's on the become of some news that elon musk has now decided, he seas, not to join the board of twitter the twitter ceo saying muffing remains twitter's largest shareholder and the company will remain open to his input here's what he wrote in a late night message, quote, we are excited to collaborate and are clear about the risks. we also believe having elon as a fiduciary of the company where he like all board members has to act in the best interests of the company and all our shareholders was the best path forward. it's just one week ago we learned of musk's 9% stake in twitter. joining us in the last hour, dan ives said he thinks six months from now muffing will own a bigger chunk of the company, not

less. >> i think this is not him going home and going into the corner look, i think fundamentally he was not going to stay quiet. that's something the twitter board clearly over the weekend wanted him to. i think now he probably gets more hostile and active. i think now this is going to become more a "game of thrones" rather than him just on the board trying to co-lab raid with ideas. >> throughout the weekend musk posted, a number of ideas without revealing he had turned down that board seat some of them were a little bizarre. those included getting an authentication keeping twitter blue, free of ads, pointing out popular accounts that don't tweet very much he also said twitter dying he also wanted to remove the "w" two twitter.

you can use your imagination what that was about. in other corporate news, jetblue planning to trim its summer schedule to avoid flight disruptions as it scrambles to find workers the staffers seen by cbnc say thaev already reduced their capacity i already did my rant, so i'll not comment. prices of gas coming down. analysts say the move can be chalked up partly to lower demand during the second half of march. gas prices are still more than 1$1.30 higher than this time lat year. >> new inflation data due out this week and it's likely to crystallize the tough job the fed has in front o of it steve liesman joins us now hey, steve. >> good morning, joe

in this clip by cnbc of the fed's previous efforts to fight inflation, the central bank always wins, but it can take a long time. sometimes the fed wins ugly. in four breakouts of inflation, it took anywhere from 37 months in 1977 to nine months in 1999 until inflation finally peaked sometimes it only peaked when the economy entered recession. why does it take so long interesting fact, i didn't realize this one, the unemployment rate of each inflation breakdown kept declining even after the feds started hiking it climbed by almost 2% when the feds started hiking in 1977 and even more under greenspan in 2004 that's before starting to rise and easing the pressure on the economy that raises inflation. sometimes it keeps declining for several months before it turns around, adding urgency to those who want to hike inflation more quickly.

when they turn around, that's when the fed starts to win sometimes they start to win ugly it can do so sharply as in 1977, '78, '79 sometimes only modestly. every cycle is different, and this time the fed rate hikes to slow the economy come up against the rebounding activity from covid and also hopefully increasing supply of labor one thing that's clear the fed often fails to see that inflation has peaked and keeps rates too high for too long and that lends support for those on the fed, joe, who want to g a little more slowly. >> steve, so i don't know whether we need things crystalized. the fed, it's a tough job. any of their tools seem to be -- you know, there's a positive and negative to everything that they try do they constantly have to weigh

whether the negative is worth the positive i mean we want an economy to maximize employment at all times. so they've got to decide what is an acceptable rate of inflation. look how long japan wished for inflation. if it's covid-related and supply chain reopening, you don't want to overreact and actually do more harm than good, trying to chase a phantom menace if it's not a phantom menace nobody knows at this point i could see how you could argue both sides if you were in one of those fed meetings, governors could be totally split on what the right action is. then they get inundated with, you know, criticism and media and everything else about being behind the curve so it's just very difficult. >> i think you're qualified for the fed, joe if you're seeing both sides quite so clearly, you know, when i look at this data, which we

put together, you know, it takes a very long time for things to work and to get ahold of inflation. and so the result is you really want to go fast. but then you look at the way things happen, joe inflation peaks and the fed either keeps hiking or stays high, and the end result of that, it ends up sometimes putting it in recession. there's reason to go slowly, to go fast right now. i think where everybody is in agreement is in the first year everybody thinks we've got to get to neutral the question is, what separates the hawks and doves, how far above neutral do you want to go? we want to go slowly so we don't win or end ugly, so to speak those who want to go fast, faster, we need to dcommit to going much higher. he's certainly in the camp that says let's get to neutral. that's why we're going to get to a bunch of 50s by the way, talk about ugly, i

think that inflation, 8.4% is the consensus. it could be higher yet. >> steve, isn't there underlying still kind of a feeling that while inflation is not transitory, we don't use it as much, but is it kind of like transitory 2.0 i don't think people believe we're in the middle of a wage price spiral that's out of control. i still think a lot of people -- you're seeing some commodities roll over. even oil i mean it looks like some of this really is supply chain, covid reopening, covid closing again over in shanghai it doesn't necessarily look like this is something that is akin to the '70s. i think people do still think it's kind of transitory or it might ease itself without the fed having to do as much as we're thinking

>> i think there are people who say, you know what we had a very, very low inflationary environment for a lot of years the trouble is, joe, i think fed policy is so offsized in the sense it's a little bit like the '70s in that regard, and the danger the fed is trying to fight is this idea of expectations, that you get to the point where people keep expecting more inflation, keep raising prices you take a company, joe, that raises prices now because it's afraid in the future and it wants to protect itself margin, and it raises the prices in anticipation of inflation. they pass along the prices i think you're right, joe, and this is a really, really important point we don't talk enough we have to get to some new equilibrium on wages there are fewer wages. we have to address the immigration issue. there are some stories of retiertes cominging back into the workforce. with very to address bringing older workers back to the work

force. there are simply fewer workers and we have to deal with that and find a new wage level. once we do that, it will not continue what we are is in the middle of trying to find a new equilibrium level giving the population and work force. >> steve, why do you think the fed is so off-sized because you're right, they're trying to raise prices when the economy is facing pretty significant pressure for the first time. jay powell is incredibly intelligent. he knows how to read the markets. he knows how to see these things was this political pressure to make sure he was going to get renominated? >> i don't think necessarily i think there were a bunch of assumptions the federal reserve made about inflation i think his hand might have been stained a bit by the politics of it ultimately when you look at how

and when he transitioned away from transitory, so to speak, it was november remember, all labor and employees were going to come back after we ended the emergency unemployment benefits. that didn't happen think about a fed official, becky. powell has been there for a long time for ten years you did not hit your inflation forecast. you were underneath inflation, underneath your target and so it takes you a while to really pivot in the sense that in that november inflation report, powell found that people -- that inflation was more widespread he found people were not coming back as fast so that's when he pivoted. could he have pivoted two or three months earlier yes. >> you know, pivoting by saying something is one thing they were still buying all of these assets as recently as last

month. >> that's where i think they're most off-sized, becky. they should have stopped that much earlier they did pivot and bring forward a lot of tightening into the economy. so we're a little bit further ahead than we otherwise would be to the 25-point basis rate point. and new data is what we found. >> steve, thank you. good to see you. when we come back, elon musk reversing course saying he will not be joining twitter's board is he paving the way to go hostile? we've got that next. check out the stocks that are leading the s&p 500 in the low market tesla is the biggest loser so far, down 3.5% stay tuned d iss bcatching "squawk box," anth icn >> announcer: "squawk box" is sponsored by bitwise, the leader

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with speeds up to 10 gigs to the most small businesses. so you can be ready for what's next. get started with internet and voice for $64.99 a month. and ask how to add securityedge™. or, ask how to get up to an $800 prepaid card. welcome back to "squawk box. the futures right now have improved a little at least as far as the dow is concerned, but the nasdaq as you can see is still more than triple digits down in the premarket. and then crypto, it's a risk off. i think bitcoin got up to about 47 or 48 now down 4% today.

so it's been a -- it seems to move in weekly -- i think it's a week where it sort of -- there's a bullish feeling and then it goes a week to ten days negative it's been slowly headed down i mean 48 to 41 is like 20%, isn't it it's like half. >> yeah, it is let's get back to the big story of the morning sort of a soap opera of a story. elon musk reversing course and will no longer be part of twitter's board. joining us to down is gene we sort of knew this was going to do be sort of a volatile situation. we thought maybe he would become ceo or take his ball and go home the story may not be over. he could still become the ceo. the question this morning is do you think this is the end of it or the beginning of this story >> andrew, i think it's the end

of the sheer drama around it of course, investing along with elon is unpredictable by design. when i talk about sheer drama, there's the hosttile takeover that's less likely it would be around 20% on friday i would put the probability there's going to be major changes at twitter at 90%. i think -- >> back up, between. you thought when he was on the board there was going to be a major change including a takeover. >> misspoke. policy changes. >> okay. >> this is based on two insights one is if he wanted to take it over, he would have done it first and foremost again, elon is unpredictable by

nature maybe he picked up on some communication with the board in the last few days and decided to go more aggressive but i think financially it would have been the smarter thing go more aggressive earlier. second is when you do a takeover, even for elon who likes to do things, aka talk to people who are putting together the cyber rodeo last week how that came together at the last minute, when you think about even elon, this would be a piece that i think is outside of where he wants to spend his time understand that there is something that is important to him around free speech, and i think he wants to move that forward. understand that he sees that as an opportunity as big as electrification and space travel, but ultimately i think this just is -- it's one too many things on the plate for him to take over just to finish the thought quickly, of course, pretty judicious when i think about these things and try to put some math around it

let's say there's a 0% chance he takes over on the doubles. you put those two probabilities together and you probably get something where the risk/reward is probably risk neutral to slightly positive. i do think he does want to introduce it. >> right now the stock trading at 4560, you think should be what >> i thinkally higher i think elon is going to exercise what he can do. he's probably the most famous person in the world. we talk about his 80 million twitter followers. but it's not just twitter followers. he's the pastor, the head leader of what is essentially religion. i'm a believer too i don't own a tesla, but i think they're going to be wildly popular. 16,000 people were very excited for what's going to happen with tesla. he can turn that on. >> gene, this is the part i'm

confused about that translates to twitter even though he's not on the board, still a shareholder. let's do it this way does he remain a shareholder >> yes, i think he remains a shareholder. >> 9% or more? >> you can go higher now that he's not on the board. i think he remains right at this 10% level, but i think what's going to happen is i could see him just asking people, you know, support me in this, buy a share or two of twitter and then all of a sudden they're going to vote with him. >> it becomes a meme stock situation. do you look at what happened over the weekend as him being pushed or as him jumping, which is to say, do you think he got a phone call or phone calls from other board members and the like when he said, what are you doing, man, taking the "w" out of twitter's name, saying they're dying, and he got so

frustrated and said i'm out of here, or they said forecast you're going to be asking people on twitter if twitter is dying, we don't want you on the board. >> my guess is the people who know him best know how to speak some reason to him, and i suspect that it wasn't a push. i think that if you try to push elon, he's probably going to do the exact opposite i suspect there was maybe a voice of reason that came into this in terms of what was in play again, there's a 20% chance i'm dead wrong, he takes this straight over. but i think there is a lot to do -- to answer your question, i think people spoke to him, probably board members spoke to him, do you really want to get involved with this he probably thought it was a funny idea and then stepped back like, not so much, i don't want to be on the board, it's one more thing i don't want to do, and here we are. again, the reason why all this happened has not changed elon has been frustrated for

quite a few years. after the fremont shutdown, it really began this movement for him around free speech he's not going to give up. i'm not trying to give a mixed message. he's trying to play a more protracted role. he has the power to do that. i think he's the most famous person in the world and people really believe in him. >> gene, to the extent there are implications -- we asked all last week -- that if he got on the board, that would have had any impact on a tesla, on a spacex government contract, the politicization of all the tax credits and the like does this take any of those issues off the table if you thought they were ever on the table? >> that can play into it free speech is viciously political. i think you can see when you think about spacex in particular, you know, tesla also

wants to try to get some government funding in terms of some of the investments they're doing as more and more tech is being built in the u.s the simple answer, andrew, i think that does help his having a more limited role in this does help that i don't think elon thinks about that, but i think it would help. >> i don't know if you can take us inside the mind of elon on this front i got a bunch of people talking about this if you think there's a consistency to it, elon's mind which has always been a -- at least appears to be a libertarian, possibly even antigovernment view -- i don't know if you think that's evolved, changed you might think it has changed as a result of o.co individual or the like, at the same time his businesses at least in their infancy or to some degree today have been largely dependent on governments. so he's had this sort of

antigovernment view, but spacex has existed because of the government. >> i would say tax credits are not -- i think in elon's mind if they get in his mind, he would say a tax credit, even though that's a government function, that really is not government. i think when he thinked about -- >> that was a government policy he even advocated for in the early days. >> i understand, but i think in his view in trying to get inside his mind, i think in his view, he thinks about government one of the biggest factors, i think speech is a big factor so, yes, there is a disconnection there between how there's been a benefit to his companies and the government, but i think that it's -- he would look at this as a massive organization and, es, there's small piece that's been of benefit to him, but there are

other piece have have been there, period. he's benefitted with the tax cre credits. by the way, i don't think that's why they've done well. >> don't you think it's fair to say the company would not have existed today were not for the tax credited that unto themselves kept this company alive? >> it did. it did keep it alive there's something -- there's a pulse and then there is a world-performing athlete i think there's a difference between the two. >> but you need a pulse to be a world-performing athlete. >> you have to have a product that people want yes, they would not have been around tesla was of benefit they needed the cash to help sell cars. that was a critical piece to the story before it really took off. >> i'm not taking anything away from his genius and the product and anything else. i'm just saying if you don't have a pulse, you don't any of the other great things you've

done. >> if you don't do anything with that pulse, you're an orphan stock. >> that's true too gene, great to see you, my friend. >> thank you. coming up, china stocks hit hard as we hear plans for a mass covid testing and other of the kuchb ee's live exporting hubs. and next, is it time to have the conversation about food and energy price controls? they always work we'll talk about that when "squawk box" comes right back. >> announcer: this cnbc program is sponsored by baird. visit baird difference.com

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we are seeing significant weakness out of china to start the week eunice yoon joins us with more the lockdown, what are you hearing? >> a lot of traders are worried about the covid lockdowns, the inflation numbers, as well as an increase in regulations. so in terms of the inflation figures, the prices for march rose faster than expected. the ppi was up due to high oil

costs as you'd expect. the cpi was pushed higher by disrupted food supplies because of the lockdown. in addition to shanghai, other cities are imposing more covid restrictions a manufacturing hub is in the middle of mass testing not only one round, but they're going to their second and third round of their entire 18 million residents. a port stir near shanghai is preventing passengers from traveling. wuhan, which as you well know is the original epicenter of the coronavirus is requiring negative covid tests for anybody who wants to take public transport. the financial sector shanghai recorded its highest daily infections at 26,000 despite the very onerous restrictions there. authorities there say they're trying to switch over to what they say is a zoned approach, which would allow certain areas that have not reported a

positive case in 14 days to be able to open up slightly no word on when that's going to happen though. neo shares plummeted in hong kong because of the lockdown suppliers also saw its shares drop after it said it's going to be putting its production into a closed loop system because its city is also imposing tighter controls the chinese government targeted further and do more to ensure there is enough competition among private companies. so, becky, i was thinking about you. i know you were talking about hoarding and we were discussing hoarding the hoarding kicked off in guangzhou even before the mass

testing was announced. you're starting to see people wanting to hoard all around the country. in fact, one of the most popular things people are looking at right now are lists for quarantine it's like what do i need to do to prepare for quarantine. there are two types of lists one is for if you get thrown into government quarantine, what do you bring some of the popular items are slippers and sheets. and what do you do if your building goes into lockdown. some of the items are mainly food, rice, cooking oil, as well as toilet paper. but the one i thought was also interesting, what's being recommended is people buy cigarettes and diet coke because apparently there's a bartering situation going on so that d cigarettes get you out of jams

and diet coke is for your mental health. >> i'm not surprised there's hoarding before lockdowns are announced when you see videos of people yelling out the windows in shanghai who haven't been able to find food. >> yeah, absolutely. everybody in different parts of the city are seeing the same videos, even though they're getting heavily censored people are very worried about what's going to happen they're like, what do you do in case you get thrown into a government quarantine or suddenly your building is locked down and you have no recourse, you just kind of have to deal with it. >> it was crazy to see this more than two years later eunice, thank you. we're going to talk more about the lockdown in china and covid with dr. scott gottlieb in a few minutes. >> what would happen if the government set the price of oil?

you don't want to miss that. that's on the way. meantime, tomorrow, we're going to get the government's march read consumer price indices will be watching very, very closely. ayunst ted you're watching "squawk" on cnbc my name is ami and when i financed my car with carvana they had questions about my documents.

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. still to come, is inflation at a place where the government needs to step in and control

prices we'll join that debate. and dr. scott leeb and the lockdown of millions of people stay tuned you're watching "squawk box," and this is cnbc i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire pain happens in many forms. matchin but that doesn'tption. scare blue-emu. delivering fast-acting pain relief in a cream, spray, and lidocaine in a soft-foam applicator. blue-emu works fast and you won't stink! an official partner of nascar.

it would set the price for american oil producers to make a profit to consistently drill something like in the 50, $60 range. >> that was from our friday

conversation with tomfriedman about inflation and the price of energy in america, and it got us thinking with prices spiking this year, should the government contemplate price controls joining us right now to debate this is heidi heitkamp sh's a former senator of south dakota and she's a cnbc contributor. and judd gregg who's a former governor and senator from the state of. >> announcer: new hampshire. heidi, i'll start with you are you thinking we should impose government controls >> absolutely not. if you look at the inflation in the 1980sing a lot of people thought it started with price controls in the '70s if what you want is more food demand to feed a hungry world, more oil production -- more oil and food production, this is the most counter productive way to make that happen i would point out something you and i have talked about. when you look at what oil

producers are telling you, they need to sustain price around $100 a barrel to make that kind of investment in american production so if you cap it, you're going to to have a huge energy crisis, and i believe an energy shortage. >> judd, i know how you feel about this i don't know why we called this a debate this idea is kind of floating around at this point there are some people bringing up the idea of price controls. did they not remember what happened in the 1970s? >> this administration and folks like bernie sanders and folks at "new york times" are totally disingenuous when it comes to the energy policy. i agree with heidi here you are releasing a million barrels of oil a day from our

reserves, and yet it won't allow canadian oil into the country. they've closed down the keystone pipeline you've got furyk saying they're not going to move more totally counter productive activity in the area of how you create a reasonably priced oil product in this country. the way you increase oil is you don't inhibit production what's happened recently is you've got this government saying they're not going to allow oil companies to recover their capital investment you've got the investment community led by people like blackrock, the feel good investment community and these college pension funds or retirement funds like california saying they're not going to invest in the oil community. so the oil community is being starved of capital intentionally by the government and by people

in the investment community who want to feel good, and then you have on the other side, the regulatory atmosphere of this government being to shut down the capacity of the oil companies to move their product once they get it if you reduced those elements. if you actually let people invest for the purposes of profit and you let the oil companies produce their product and move it. you'd see prices drop dramatically i disagree with heidi on only one thing. i think you've got a lot of companies who make money when oil is at like $30, $40 a barrel because they're low cost producers in that atmosphere maybe san antonio is a little higher >> let me twist this conversation a little bit because we do have a situation where inflation is getting to be out of control we're expecting new consumer inflation numbers tomorrow that

are expected to be 8.4%, and that is a huge hit that is something that is pinching the consumer's pocketbook at this point what would you do at this point to try and address inflation heidi, i'll start with you. >> i think the first thing you need to do is look at who it hits the hardest and then take a look at some long-term solutions for reducing demand. i mean when we look at it, there's a great program that helps us weather-wise houses so we can stay warm even with higher energy prices take a look at what's happening with the food stamp program and what we can do to help mitt guise some of the costs. can i make a comment with regard to the governor's comments he asked why the oil industry has retreated.

why doesn't he believe what the oil industry is saying themselves over 06% say, guess what, during the shale demand, we overspent, we overpromised, and we overproduced, and we're not going to do it again we're not going to do it at $40 a barrel, we need something higher, and to blame the government drn and i love the keystone xl argument that's the first thing donald trump did when he became president was to open up the keystone xl pipeline in four years they didn't build it let's just get real about what's required for the oil industry to actually get back into some kind of normal flux of production and so i think inflation is something that's going to do be with us. i think that the real important thing is to take some money, easy money out of the system, which the fed's doing as we saw the 30-year mortgage prices go up to 5% but we also need to realize the consequences of inflation are

felt in a disparate way in this country, and we need to figure out public policies that will address that disparity. >> hey, judd, i'm hoping you can respond to that. what do you say to what clearly appears to be a generation of investors perhaps younger who seem to be esg-minded, not that it's governments or pension funds unto themselves that are doing it, but people who have decided on their own that they don't want to invest in policies by the way, i'm not suggesting that that's the right answer or the bronc answer, especially given the national security issues we're dealing with right now. but long term that seems to be the way things are moving. your friend hank paulson and others have started funds around this blackrock and others are doing it as well they're doing it because there seems to be a market insofar as that's how investors are focused. what do you say to them? >> we've got three issues that you've raised that you asked me to respond to. first on heidi, i'll respond to

that quickly there's no question the administration came in with a justice jihad for anything carbon producing and therefore as a result have specifically locked down things to the point where the government is trying to lock down carbon production on the inflation, we printed too much money we printed $7 trillion that wasn't backed up by anything and no economy can do that and not expect inflation the only way to get inflation under control is get some of that money that's basically got nothing behind it except a printing price out of the system and that's going to reglet gretly lead to a recession as it always has that's unfortunate, but that's how you end up slowing inflation in this country. on your important, there's no question that we need to move away from carbon production. but the point is that it's being done in an irrational manner they're trying to do it overnight. you can't do it overnight. so much of the economy is

dependent on carbon-based products take a windmill, for example it produces more -- it takes more carbon to produce a windmill than that windmill saves over its useful life you have to have a rational approach and that is to let the market reduce the price for carbon, and you'll see carbon prices drop. and as you see people move away from carbon, they miev to some energy source, whether it's an alternative energy source or nuclear power, for example, then the price of oil will also become less of a force in the economy. but you can't do it overnight, and that's what unfortunately these folks seem to think they can do, and it's not going to work. >> senators, i'm sorry we're out of time. re appreciate you both being he today senators heidi hide cam% and judd gregg "squawk box" will be right back.

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parts of china that seemed like they did the wrong thing in terms of trying to react, different than the way we did it here, i think. what's the vaccination rate in shanghai, and then what's the vaccination rate for the elderly in shanghai? i think that's the real issue. >> shanghai has one of the largest oldest populations there's about 4 million people over the age of 60, and 70% of the people over the age of 70 haven't had more than two doses. in china, 52% haven't been vaccinated at all. only 50% of those have been boosted. the problem is these lockdowns that we're seeing in china, which are true lockdowns, they seem to be the ends in and of themselves they're not using these kinds of mitigation measures or mitigations they've deployed to get them used to the population

through vaccination. the rates are much lower the mitigation seems to be the ends in and of themselves and they haven't used that time wisely >> yeah. i mean i've seen op-eds written that at some point the people that aren't at risk for real serious disease, that the herd immunity or whatever you want to call it that's finally generated, that becomes a powerful tool against covid, and they don't have that over there. no one -- if no one can get it, then you're taking away that entire population that could have not been at risk if they had had a mild case. >> right remember, we acquire a lot of immunity in the u.s. it's going to be a backstop against further spread hopefully, barring something new and unexpected and we did it over a prolonged period of time through successful tragic ways of infection and vaccination, but we department do it all at once.

what happens now, the risk in china is the sing thick that happened in hong kong. you're dealing with a much more contagious variant that's going to be much harder to control than the earlier variants and they have an immune population that's not as vaccinated they don't have any immunity from prior infections. this virus, which is much more contagious than earlier variants can rip through that population very quickly that's why they're being so aggressionive. they saw what happened in hong kong where there was excess ive death. compared to south korea. much more infection, much less death because south korea deployed vaccines effectively. hong kong didn't neither did china. >> whenever you see people pointing to president xi's motivation and trying to put on

the appearance of handling this perfectly and it could be a major problem if this does burn through the older population the health care system in china could almost collapse. if everything he touches and turns to gold, that's not something that's going to be acceptable. >> yeah. what we saw in hong kong is omicron, while it's an inhumanitarianly more mild form of covid, it's not inherent ly so when you put it in a population where there isn't a lot of baseline immunity, it's not a mild infection right now you have about 23 cities in china under some form of lockdown covering up 200 million people it appears that they've lost control of this in shanghai.

there are many more infections of what's being reported the data coming out of there is implausible. they say there's only one severe case and no deaths we know that's not true. the "wall street journal" has reported on deaths and outbreaks in nursing homes it appears they lost control of this in shanghai tragically, and there much be much more morbidity there than what we're seeing on media. >> we've got a hard break coming up, doctor thanks we appreciate it we'll have you on again to talk about what's happening in this country, fingers profits. coming up, mohamed el erian joining us. "squawk box" will be right back.

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good morning tech names leading the way lower as pond yields continuing to rise and twitter saying elon musk won't join the board of the company. we're going to talk about what it means for the social media company. plus, from rising inflation, talk of recession risks. a member of president biden's economic advisers will be our special guest as the final hour of "squawk box" begins right now.

good morning and welcome back to "squawk box" here on cnbc live from the nasdaq market square i'm joe kernen along with becky quick and andrew ross sorkin did you hear about something happening yesterday? >> an explosion, manhole cover. >> i couldn't get down the street. >> this is crazy >> welcome to new york. >> welcome to new york u.s. equity futures, they're quiet today anyway i just love that -- the only thing that get mess is that taco bell sign also reminding meta co-bell is available somewhere, taco bell is available that's a hard thing to deal with if -- >> okay, home sneer u.s. egg questionty few urs at this hour are down 117 points. as you can see, nasdaq is off

about 150. treasury yields are up there 2.7 and change, 2.75 and change. but you see the two-year inverted six with the five-year. crypto this week as well. in our headlines this morning, the stock of the newly combined warner brothers/discovery is beginning to trade today with its new ticker symbol, wa didi by the way they're being named as robust content. at&t shares right now up by about 2% this story is interesting too. shopify announcing a ten for one stock split. they're also proposing the creation of a new founder share that would increase its ceo's voting power from 40% to 43%

it would be a vote lasting as long as he's still working for the company as an executive, even as a consultant he would not take it if he were to sell down to 5% left or if he were to step down from the company or move on it would not go with him clearly an interesting proposal. that stock is up pretty sharply. i don't know if it's because of that aspect or the ten-for-one stock split that would get the price down significantly and allow them do more stock for payment. >> i like him a lot, but i have to tell you -- >> it's kind of crazy. >> i don't know why they're giving him more shares and controlled shares at this point. are they worried about a hostile takeover >> i guess my guess is they want to make sure he is the controlling shareholder. maybe he wants to sell some of the stock and that would bring him down to 34%. i don't know this would last and keep him up there. >> look. he's done a tremendous job this isn't a critique of him

it's a critique from the government's perspective. >> in the meantime twitter announcing elon muffing will not be joining its board it announced a 9.2% stake last week neither side gave a clear reason for the reversal the share is down by 2.8%. we're going to talk much more about this story and some of the regulatory stories that might be at play with former s.e.c. chair jay clayton who will be joining us in the next hour. >> a little hint of what may have been going on over the weekend behind the scenes. elon musk liking a tweet from someone called the tank. he said, let me break this down for you. elon shared with free speech and told to play nice and not speak freely if there's any question, elon saying, at least i like that

that might be an indication of what happened here >> he's the ultimate insider he's an outsider. >> but the thing that doesn't make sense is this should have been expected. >> they said, well, you've got this much, so we're going to make it. and then you start seeing what that actually entails. >> right but why would you say, i'll take the board member's seat and then you realize yourself afterward -- >> because the course he's on, he doesn't behave that way the boards he's on, he does what he wants. >> i'm not saying that's not true i'm just saying i don't understand how he, who i think is one of the smartest individuals i know would not see what was about to happen. >> he can affect more change at twitter if he's not being, you know, play nice, you know. >> but then they say you'll take the board member seat -- >> what? he can't change his mind >> sure, you can change your

mind. >> once he see as what it would entail >> i think once he's on the board, they're like, we want you on the board because we want to hear your ideas. they didn't say, we want to hear your ideas but bedon't want anybody else to hear them but keep them to yourself. >> i can't imagine nobody said to him or he taught to himself, this is going to be tough to be public with my ideas and have this happen, right meantime let's get back to the markets. mike santoli is at the no, stock exchange what's going on, mike? >> under pressure, the s&p 500 as we wait to open the multi week rally we got off on a low starting a month ago did not get escape velocity. what are we looking for? i think a lot of -- if you're bullish and want to see this be a bottoming for make or a trading range that holds up, these are the levels down a couple percent that probably traders are looking to have whole. you see we're back in sort of another short-term downtrend

after we broke the steeper one so under pressure as we get into earning season yields creating one source of challenge as well as growth concerns you can sort of see this in the ten-year treasury yield really active to the bank stock index you see they were moving perfectly well until they sort of detached from one another here that's when higher yields were considered more a threat to economic growth and credit equality as opposed to a boon for the bottom lines of the banks. that's been a pretty stark relationship also somewhat similarly, crude oil really active to the sle you see here they have actually now converged again. you see energy stocks did not really get any direct benefit in the short term from the huge spike to the highs in crude oil. it was seen as if that was too much geopolitical premium. not the kind of price increases for the commodity that's necessarily going to feed into

long-term profits. meanwhile energy stocks show up. it's very profitable it's the source, energy is, of almost all the upward earnings revisions on the net basis if you take energy out, earnings are considered to be a little bit slightly down relative to what we thought they were going to be at the start of the year we'll see where that plays out as people start reporting. >> are you with mike wilson and morgan stanley where you think a correction is coming given the kind of numbers you're seeing at this point >> of course, mike wilson has for months been saying it's going to be a cyclical bear market and it's been unfolding in waves i think that's still the open prospect i don't know that you have to make that call right now the market has not disproven that idea. he's talking something similar to the late 2018-type episode where the market went down 10%, you stabilized, and you had that move down. we haven't gotten that extra flush lower.

the big question is we've been going down in terms of growth stocks for over a year now a lot of internal damage has been done. it's unclear if the indexes have to kind of show the final push lower to say we sort of priced in all of the risks. >> before we go, we've been looking at crypto all morning. bitcoin, 41,000. do you have an explanation of what's happening it went up on the become of what seemed to be news out of washington there was going to be a regulation that people seemed to think was a good sign of the future of all this, and then it's been steadily creeping the opposite way. >> yeah. i have no explanation aside from the fact it really is a good mood ring for the overall markets. it's a risk appetite gauge it's been correlated with the nasdaq i think the regulation was more the absence of a negative than direct positive in terms of price. sure, the ecosystem is going to be allowed to maybe exist and grow with some sort of known

guardrails, but that by itself didn't seem to be son bicatalyst. >> thank you joining us now is mohamed el erian. he's an economic adviser and queens' college in cambridge president. let's talk about the bond markets. yields continue to climb we're expecting inflation numbers to be pretty hot is the bond market already catching up to this realizing what the fed let's movements are going to be or is this just the beginning of a pretty steep continued climb? >> it's the middle of a steep continuous climb, and for two reasons. one is that the marketplace is understanding that inflation is going to remain high, and the second is that this co-dependency between the markets pushing the fed to be more focused, and every time the fed speaks more hawkishly, the marks move it even more. fundamentally we're pushing the

regime, whether you're pushing it way out we're changingly quiddity regimes and that's what the bond market has been reflecting and the stockmarket is adjusting to that. >> pau krueger has been out yesterday and today arguing he's less so. he says we could see a drop in some of the inflation prices even tomorrow you could see a drop-off because of lower shipping prices and things, but he's worried the job market is too tight and the market he thinks should not stop hiking rates've phen they see inflation numbers come down. do you agree with him or not >> so i agree with him on two things one, we're going to see a rolling over of the drivers of inflation. that started last year as the drivers grow and we're going to focus a lot more on the labor market and wage increases because labor expectations are on the move i also think the fed has no choice but to tighten monetary

possess bought through q.t. and higher rates the question that no one knows is will the fed restore its credibility and lead the market. right now the fed is scrambling to catch up with the markets, and that's an unhealthy dynamic. >> will it work? if they continue to raise rates that i guess could crater the economy, which means you won't see the wage increases that you'd get otherwise, but there still seems like there's a really big shortage of labor in this country, and i don't know how you fix that with any of the tools the fed has at its fingertips. >> that's why every time i've been with you for the past year, i keep saying, be careful, the fed is falling behind the curve. the fed should start now so it doesn't have to islamslam on th breaks now there's a very, very narrow pathway for orderly

disinflation the fed has to be very lucky to be able to strike that pathway there's a real risk, and the market is starting to sense it that the fed is going to push us into recession because it's waited so long and because it's fallen behind. so, yeah, it's going to be very tricky for the fed to deliver this pathway that's why people are calling it the immaculate disinflation. the fed's not sure how it's going to happen. they just hope it's going happen. >> what you do think, what the most likely outcome is going to be can they do this, or do you think they do wind up in a recession? >> i think the fed is going to flip-flop. i think the fed is going to start slamming on the brakes including a 50-point hike that they need in the beginning of may circumstance going to hint to another 50 basis points then it's going to see it's contributing to a major slowdown in the economy then it ooh goets to take its foot off the brakes, and we're going to have this flip-flopping. this flip-flopping is going to

help no one and it's going result in more stagflation in 2023 that's what i'm really worried about, that we end up in a flip-flopping regime. >> if we do, what does it mean for the stock market and bond market >> i think for the longer term, it's not good news for either of them there's going to be lots of trading opportunities. i was on the air with you two weeks ago that some people may want to take some chips off the table. i've been a great admirer of the resilience of the market because there is no alternative. slowly there is an alternative short rates are getting more attractive so it's not positive real rates yet at the short end, you can get more while you wait. we look at the ten-year. the ten-year real rates are creeping back to zero percent. so they're starting to be an alternative to the equity market and that will take an important

technical away from that marketplace. >> we've watched technology stocks get hit pretty hard every time you watch the yields climb again. that's the case again this morning. it has been for several weeks at this point do you think technology can find its way to lead the market higher, and if not, what does step in as the next leader for the markets? >> yes, eventually that would be the one thing i would look at. and when the time comes to put the chips you've taken off the table back into the marketplace, technology will be an obvious candidate. it's not surprising they are sense active to rates simply because of the discounting that goes on. but if you look at the secular argument for technology, it is as strong as it's ever been. it's just that the valuation right now have to adjust it in new liquidity paradigm. >> 8.4%, that's the number we're anticipating tomorrow. if it comes in weaker than that, what do you think happens? >> i think it comes in view of a

releif i hope it comes in weaker. but unfortunately as we proved today with china ppi, market forecasts have been well below falact actuals in terms of inflation. it wouldn't surprise me if woe struck it higher. >> mohamed, thank you. >> thank you. coming up, this morning's biggest stock movers stay tuned you're wating quk x"n ch"sawbo o c nbc live from the mark site in times square in new york >> announcer: this portion of cnb can c sponsored by baird visit bairdifference.com hybrid work is here. it's there. it's everywhere. but for someone to be able to work from here, there has to be someone here making sure everything is safe. secure. consistent. so log in from here.

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private equity firm for 65.25 per share. that's up over 30% coming up on the other side of this break, we're going to talk to heather boushey. she's a member of the council of economic advisers and talk about inflation and what washington should or shldoun't do about it. you don't want to miss this conversation we're back after this. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire alright, so...cordless headphones, you can watch movies through your phone? and y'all got electric cars? yeah. the future is crunk! (laughs) anything else you wanna know? is the hype too much? am i ready? i can't tell you everything. but if you want to make history, you gotta call your own shots.

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welcome back to "squawk box. the nasdaq down. it's not all all prices are well below 100 at this point maybe it's recession fears or rate fears, et cetera. oil down almost 5% so it's at 275 ten-year that's maybe front and center. >> we're going to get the latest read on consumer inflation tomorrow at 8:30 eastern time. ite expected to be another hot report, up 8.4% year over year president biden has talked about increasing domestic manufacturing as a way to fight inflation, but there's a debate over whether that would actually work joining us now is herkt b heath boushey. good morning to you. what can they do to fight

inflation in this ball game? >> certainly this is an issue the president has been very concerned about and there's been a number of steps he's taken and continues to focus on to make sure we keep costs down for families for example, last week, president biden talked about making sure that people are eligible for subsidies under the affordable care act, actually got them, and doing everything he could to make sure the government served families in that way that's just one example. other announcements is a release of 1 million barrels of oil a day to keep prices down. those are all the ways the president is looking to lower costs for families in the short run while also as you mentioned making sure we're making the investments we need to make, have a more production tissue economy moving forward those investments in manufacturing t calls in the budget for investments in our

nation's ports, in housing supply, and in, you know, across our economy, making sure that we're focused on making america more competitive >> how concerned are you that as the fed increases rates, which i think they all agree we need to do, that it is going to cost us as taxpayers even more to service our debt >> well, here's the thing. you know, first off, we are in a strong economic position in a number of ways we have a low unemployment rate. it's back down to 3.6%, a tad higher than it wu prepandemic. we've seen 7.9 million people get a job since the president took office giving them the economic dignity and security that comes from having work. and we've learned ho tow cope with this pandemic through vaccinations and all the things. we've gotten schools reopened. all of this combined has mate it possible for businesses to be making investments

startups have been going up. we see families have strong balance sheets some of as we're looking at this moment when the fed is pulling back. businesses and families are in a relatively strong position and we know how to cope with the challenges in front o f us as we see russia has provoked the war in you krand it's led to challenges in the energy markets, we've had tools such as releasing oil from the strategic oil reserve. >> on the oil price issue, we have seen the price come down. i'm not sure that's a function of the release of the strategic petroleum reserve so much as what's happened geo politically over the past two weeks, no? >> well, time will tell exactly what moved what. but certainly we are pulling out all the stops to make sure americans have access to the energy they need, which, of course s why we need to be making these long-term

investments in clean energy which the president has prioritized from day 1 we're trying to use all the tools in the government and make investments stay down. >> heather, we've been having lots of debates in this broadcast over the past several weeks over how to think about esg investing, around issues of fossil fuel, for example, and considering national security at the same time. i'm curious how you think about it and specifically how you think pension funds -- i'm thinking, by the way, chicago's pension funds. there's a number of pension funds across the country who say we're not investing in fossil fuels anymore do you think that's the right decision or wrong decision given the other national security issues at the fore >> certainly the market decisions are theirs to make. >> those are -- they are sort of

quasi private. these are actually public pension funds making some of these decisions. >> here's the thing. because of climate change, weer going to have to change the way we use oil the president has called for an all-government approach to this. and seeing the privatesector step up and saying investing in fossil fuels at this time is not putting us on a path to sustainability these are not investments we'll be able to take advantage of in the long term. it's risky it also affected our independent economic competitiveness if we can wane ourselves and not be subject to the vagrancies of the oil prices -- >> i'm not disagreeing with you. i know some may disagree with you on that.

given the short term in this particular moment, you actually want to probably innocent five production given what we're facing, no >> here's the thing. there are many clean energy technologies that are cost-effective, and we can be investing in it now. so these are choices that businesses are making the here and now, but we know that because of investments we've made over the past decades t cost of solar and wind has been coming down. so that makes them competitive i think these are smart decisions, and they're the right decisions to put ourselves on a long-term stable path to growth and sustainable. >> heather, last week deutsche bank came out with a report saying they believe a veegs is in the offering in the next 12 to 18 months they also contend the stockmarket could fall as much as 20% and that unemployment in this country could return to about 5% what is your office's analysis of that argument >> well, you know, we spend each

and every day focused on look actionet the economic data, trying to understand what's happening to the economy, so we can help the president make the best decisions and here's the thing we arein this moment in a very strong position because we've been able to get the unemployment rate down, because we've been able to reopen the economy and make it safe for people to go out there and go to school and work because we've been able to contain the virus we've shown that we know how to both craft a plan and execute with tools that can help americans all across the country. so we remain optimistic that we understand that tool kit and we are focused on making sure we sustain this historic recovery for american families. >> heather, i think most people would say europe and germany specifically have followed your -- what you were just advocating in terms of renewables and making transition much more quickly. do you think that that's going well in europe and germany right now? do you think that this is the kind of future you'd like for

the united states in the here and now? you don't see any problems with what's going on over there i'm just wondering >> so we are in a very different situation than europe in terms of our energy. that is because we are a net energy exporter, so we have a lot of choices in front of us. have a lot of resources and opportunities to make good decisions that help families in the here and now but then make those investments for the long term. >> they all involve fossil fuels, heather. >> well, that's why the president has opened up the strategic petroleum reserve. you know, it remains the case. the fossil fuel investors in this country do have access to tools as well. there are 9,000 or so leases not being drilled on but at the same time, we know we can make those investments in clean technology we need to meet that need now, but we need to be laying the groundwork for the future. >> hrt, it's great seeing you and we look forward to having a

conversation with you soon. >> thank you. >> thanks. when we come back, did regulatory issues end elon musk's appointment to twitter's board before it began or sit because he was told to be qut?ie we're going to ask former s.e.c. chairman jay clayton that's next. you can't buy love. happiness. or confidence. but you can invest in them. at t. rowe price our strategic investing approach can help you build the future you imagine. ♪ ♪

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welcome back to "squawk box. big day in the media world newly combined warner bros./discovery beginning to trade under its new ticker name wbd. jpmorgan upgrading to overweight from previously. a $22 price target, meantime, deutsche bank is naming warner bros. discovery as a top pick citing it as robust entertainment content. >> if you're an at&t investor, all of a sudden, you're going to look in your caccount and see ne discovery shares do they hold them, sell them, try to buy more of them?

by the way, a great story about zaz and what he's going to try to do with the company, his understanding of the culture and the former culture of the company, sort of pre-@at&t days and try to revive that so much of the industry has changed so much that harkening back to those days doesn't exist anymore, right that's sort of the underlying question. >> i'll be interested to see some of the changes now that it's done, especially with malone lurking and hearing some of the anecdotal -- >> you 're thinking of cnn, i think. >> i think we're all thing of different aspects. we may have conversations on the set depending on what the news is over the next six months, don't you think? >> i think it will be fascinating to see what happens to cnn and --

>> you heard that cnn plus, is it rolled into -- >> i think there's no question whatever you think hbomax streaming is, that that becomes some super app one-product service or becomes a product that sold together the same way we see disney plus and hulu get bundled. cnn plus, my gamble, that it gets folded into -- but maybe in a temporary way on a pricing basis. by the way, if you could squeeze out even an extra two or three bucks as part of a joint thing, that would be quite valuable if you could do it. i don't know if you could. i know you think you can't. >> they go back to what cnn used to do ten years ago, like covering breaking news and being there around the clock. >> i think they're doing that --

what they're doing they're doing it quite remarkably. look during war time, cnn, that's where they actually excel. there's an expectation people click on that. >> yes, there is in other corporate news, twitter ceo announcing elon musk won't join the social media's board. any story about the tesla founder seems to spark regulatory questions joining us now is jay clayton, former s.e.c. chair, currently lead independent director of apoll joe and a cnbc contributor. are you watching like the rest of us being bemused or amused? >> i'm watched and nice to see y you. i think on thursday, joe, we talked about the additional obligations that someone takes on when they go on the board of directors of a public company in america, including section 16, which is a significant

restriction on your ability to buy and sell shares and has added reporting obligations. we talk about fiduciary duties and your obligations to the company and its shareholders and other constituencies including obligations of confidentiality, almigh loyalty, and the like. look, those are very significant obligations, and i think what we're seeing is someone assessing the obligations and saying, well, maybe that's not the right path for me. >> because what does he have in mind that he wants to accomplish that make being on the board not the best way to accomplish those things >> well, it may not be one thing, joe when you go on the board of directors of a company, your degrees of freedom as an investor are substantially restricted now, to put a pin in it, you're

in it for a long haul and in it along with your other directors and officers, and that does restrict your freedom to operate. that's, i would say, the overly simplistic but practical way to say it. >> he's been on boards before, so he knew all this. >> well, you know, that is something you talk about with your advisers and the like, and i assume every situation is different, but that is a substantial consideration before you go on the board of directors. hey, look, there's also trading information. when you're on the board of directors of a company, you're privy to confidential information that is material in market moving. that can also restrict your ability to move in and out of stock or other security. >> hey, jay, a lot of expectation whether he takes his ball and goes home and sells his other shares or whether it's the beginning of drama in which he

tries to begin to take control of a company we talk about the fact there's a number of people in this company including egon, if he wanted to pursue a hostile bid in conjunction with people related to the board, could he do that without disclosure, and at what point when would conversation have to happen and in terms of selling more shares or buying more shares, what's the disclosure requirement there >> look. he's now on a schedule 13(d), which was filed. there's still a risk >> does that mean it's still doable or that makes effectively pursuing something like this impossible >> well, i think what i'm saying, andrew, pursuing any

kind of strategic transaction like that while you're on a 13(d) is going to be otherwise. >> last week he went from a passive to active investor there's some people who have made the argument that during that period that he had effectively misfiled -- that he could arguably owe 11 bucks a share if not more to every shareholder during that period he was buying that up. do you think the s.e.c. should either be investigating or bringing a case related to that? >> here's what i think about that, andrew again, it's a practical response that issue is going to play out. that has happened whether he was basing it on 13(d).

>> do you mean regulation? >> i have no doubt regulators are looking at this or at least would take a look at. >> would that be consideration for not going on the board, so you saying okay, i'm not going to be an active investor could he go back to being passive if he's not going to take a board seat? >> it's hard to speculate. th those actions are in the past, becky. that will be investigated. what's happening now is people are making best desiegs now going forward. >> as far as just as a -- not as a former s.e.c. commissioner, but what do you think elon, the endgame is for him here? i mean obviously it's not about shareholder value and maximizing returns and profitability. it really is a free speech --

that's what he did it for. oober free speech guy. how does he effect a change there? does he finally say, forget it, i'm going to move on to colonizing mars? >> look, joe, i'm probably in no better position to think about what the motivation is beyond an investment here are than anybody else, but anybody who has a large public platform does have the ability to influence how people think about, you know, lots of things so i think we'll continue to see that play out. >> jay, on another announcement, shopify looking to effectively do this ten-for-one split but also give larger voting control to the company's founder, i'm curious from a gosh vernance

perspective, as an ipo and after the fact. >> i'm generally, generally a default, one share, one vote, as the best form of governance, and particularly with large distributor shareholder basis. i'm not sure exactly why the board of directors would have thought this was in the best interest of the company, but we do see lots of companies that have founder control perform exceptionally well. >> okay, jay thanks good to have you on this morning. >> all right take care. >> okay. >> okay, coming up, we're going to get you caught up on the trading. [ indiscernible you're watching "squawk box," and this is cnbc

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welcome back to "squawk box," everybody. we've been watching the futures this morning and they are still in the red dow futures down by 143 points s&p off by 31. the nasdaq down by 167 let's get down to the new york city

j new york stock exchange. jim cramer is standing by. the tech stocks are kind of taking it on the chin once again. how long does this continue? >> i think we have to have some evidence of some number that makes it so that we don't know that inflation is still raging, and once that happens, i know people will say, therefore, it's going to be the bondurant off by the fed. we see inflation cool a little bit. then i think people will actually buy bonds but as long as the interest rates go higher, they're going to keep selling the nasdaq, which is really incredible. >> the bond markets leading with the fed. we were talking earlier today with mohamed el erian about this and the comments we've been getting all the way coming through this from paul krugman, which i think is interesting he's more dovish he says he's a lot less dovish than a lot of other economists at this point that even if you see a downturn in inflation, he would like to see the fed continue at this pace because he thinks it's the hiring market so

tight at this point, you're facing stagflation otherwise. >> i know. it's incredible. it would be the polar opposite of what i expected at the same time, maybe we see a break in inflation and they can stop there's been no break whatsoever and when i see these pictures from the lockdown inwhatsoever i see the pictures from the lockdown in china, i think we'll have good inflation for goods again. in is for workers. it's great workers are getting more money but getting 5% increase and have 9% inflation rate. >> then it becomes, you know, this self-fulfilling prophesy. you have to pay the workers more to keep up with inflation, as a result you have the fly wheel. just keepsrolling and rolling. and that's what i thought was interesting from him even the idea of see a rollover in inflationary prices, he thinks it won't be enough and the fed should power through. >> i think there's a change in

the way people work. i mean, brian sullivan had a great piece this morning about small business small business is opening like mad! we hear it from pay chex when i had them on. people are starting -- they're becoming more entrepreneurial. shopify is another place you can do your own thing. i think it's a change to the way people work. therefore, the traditional places have a hard time getting people, except for the huge, you know, huge retailers. >> jim, we only got a minute you mentioned shopify. want to sound off on that? i'm curious. and mr. musk what do you think? >> i think the shopify, i didn't like the change in class there was no reason for to do that elon -- can you imagine? would be so bored. i think it's better that he is able to lob things now if he's internal, he's silenced! once he's in the tent, it's good for management he doesn't want good for

management he wants changes. >> selling or going hostile? >> i think -- wow. i mean, he's got so much on his plate. does he have time to go hostile? i think he's going to want to try to make some changes even as a large shareholder, if not he'll go he has good ideas. >> jim, thank you. we'll see you in a few minutes by the way, we want to remind you about the cnbc investing club sign up to find out more at c cnbc.com/jointheclub or point your phone to the qr code on the screen and it'll take you there. (fisher investments) it's easy to think that all money managers are pretty much the same, but at fisher investments we're clearly different. (other money manager) different how? you sell high commission investment products, right? (fisher investments) nope. fisher avoids them. (other money manager) well, you must earn commissions on trades.

(fisher investments) never at fisher investments. (other money manager) ok, then you probably sneak in some hidden and layered fees. (fisher investments) no. we structure our fees so we do better when clients do better. that might be why most of our clients come from other money managers. at fisher investments, we're clearly different.

welcome back to "squawkbox." take a look at futures we're in the red this morning. looking to open about 140 lower on the dow the nasdaq off about 165 points. joining us now is liz young. head of investment strategy at sofi good morning. >> good morning. >> we're trying to make some sense of the market. the number of folks coming out with more reports that were, at least, arguments for why we may be heading toward a recession. where are you? >> i i don't think it's a huge surprise are coming out with reports we're heading that way we're seeing a lot of cyclical

signals that turned over you see the housing stocks turn over we have consumer sentiment that has taken a nose dive because of inflationary pressure. i think there's a chance as we move through the year and you look at where the yield curve is right now, we're pricing in eight more hikes from the fed. i still don't think they get there. i think they go after it with a heavy hammer earlier in the year so may and june. but then if things start to relax, we see them moderate their tone it'll be taken as a dubbish pivot and the yield curve changes. i don't think we're necessarily heading for something bad for sure it's going to be tough not smooth d coupled with a midterm election year. >> therefore investors are trying to figure out what they should be doing. are you arguing the next couple of months will be chompy if not down it would argue to weigh, if you had money on the sideline, or do you think this is it a fair entry point?

>> i think that this is a time when you want to make sure you have some allocation to defensives in the portfolio. the next few months, even through summer this is usually how it works you have volatility through summer and a bounce back in fall especially once the election is behind us. so if there's volatility that is going to persist through summer, you still want to have defensives in the portfolio. that's what's been leading thus far. and defensives usually do well after a yield curve inversion. you want to stay the market. thing is a time you start building positions in the market in volatility, it's opportunity time to buy the dips in large cap tech which is now something that we all know we see as defensive and i still like health care. that's usually in the large cap space and defensive space. even in the small cap space. you can find nice growth opportunity in bio tech. >> and most people don't say this aloud you think large cap tech today

is defensive >> i think it's defensive in the sense that we've already seen a pretty big pullback. so that 22% draw down in the nasdaq from peak to trough it rallied back a little bit but continue to see volatility so what i would say is in the beginning of the year, we had a market where people were selling rallies. now we've transitioned and i think you can start to buy dips again, especially in high quality and large cap tech but know you need to hold it for the long-term. this isn't a trading game. this is a nicer entry point than you had january 3rd of this year. >> i don't know if you can read the screen bitcoin down about 5% and etherium, as well. we were talking earlier about what lead to what seemed like a sort of bullish moment that was the idea regulation was coming, the biden administration seemed to accept, to some degree, bitcoin was here that pushed things up. but then basically lost a lot of those gains.

what happened? >> well, the acceptance of bitcoin in the marketplace, the acceptance of crypto as an asset class doesn't mean it goes straight up. we're trying to figure out in every market cycle how it's supposed to behave this year has been really confusing. we thought that in an inflationary period it should rally. it's not necessarily what happened it became very correlated to risk assets. so i think there's a lot of investors out there that are watching this price discovery phase and waiting to find out what we should see as our expectations for the rest of the year not mention regulations are still a big question mark. that will put pressure on the space. >> it's not -- i thought it wasn't -- it wasn't going to be effective on inflation and it was all of a sudden and it wasn't liz, thank you. >> thank you. >> i don't know. >> katie stockton said it's leading the stock market. >> right, no it's connected to the stock market. >> but that is leading the market. >> yeah. the riskoff you see it in

bitcoin and see it everywhere else oil is something we definitely should mention in addition to what we're seeing elsewhere in terms of riskoff oil a big loser. 93. >> yeah. lockdowns are frightening when you read closely on what is happening in china make sure you join us tomorrow "squawk on the street" is up now. good monday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber live from the new york ek changes. coming off a losing week the shanghai lockdown extended the 10-year yield near 2.75. road map begins with another day and headline from elon musk. deciding not to join twitter's board. plus we have a new era beginning as discovery closes that deal. it is no