good morning welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm rebecca quick along with joe kernen andrew is live in washington andrew, what brings you to washington >> i'm here hosting the deal book d.c. summit this afternoon. i'll speak with janet yellyellen after that, we will talk to howard schultz i'll talk with senator chris murphy i'll bring you highlights from that tomorrow morning. so many other big regulatory issues in d.c. we'll talk about payment for order flow and other things with the guests today lots to discuss. >> for sure. a lot going on in washington a lot happening on wall street

we should get a check on the markets. you see there are green arrows these are moderate advances at this point with the dow indicated up 84. s&p futures up 12. nasdaq off 48. yesterday, we saw losses across the board. nasdaq down .7.75% s&p was the big loser down 1%. we are barely on pace for an up week we will see what happens with that treasury yields. the 10-year note at 3% of the 30-year note at 3.16%. and the wti with the closing above $122 that has national gas prices hitting new highs.

$4.90 according to aaa for the ga gallon the average in 12 states is above $5 i think the latest check on wti is $121.90 brent up at $124 a barrel. no end in sight in terms of looking for relief >> we a y2k problem? >> for $10 a gallon? >> $5. >> five is not hard. kick it out another. >> they haven't manufactured any fives. i guess $1.35. >> just if you have an extra space. the y2k problems news out this morning, chinese financial regulators are reporting a revival of the giant firm over there.

ant group. who thought that we're big. we're powerful we're widespread we're ant group. >> ants are strong for their size, they can lift amazing amounts. >> you got me there. i see them carrying big crumbs >> bigger than themselves. >> bloomberg says china is slowing down on the crackdown on big tech kweb etf is on pace for the best month since june of 2020 the journal with an unbelievable piece. tough for tech they are going back a decade tech has been dominant dominance is in question we will see if it turns into something worse than it has been it is salvageable. we count on tech >> it leads the way.

>> it's been tough for the stocks ark invest is buying the dip on tesla. that stock is off 40% from the all-time high. wood says she added 50,000 shares of the ev maker over the past two weeks to the innovation fund autonomous technology and ro robotics fund and next generation internet fund >> you think she would have to she likes it at higher prices or says oops. >> that works for anything now i'm following target i think that was up yesterday in a down market. $156.70. if you liked it at 270, why not like it at 145 >> unless the picture has changed that drastically

that is what people are trying to figure out. let's talk about the elon musk and twitter saga. twitter reportedly planning on offer musk access to the data on the hundreds of daily tweets this is in an effort to push the $44 billion take private deal past the finish line and tamp down concerns of the bot activity la lawyers in the deal would not con confirm. twitter shares are down 20% since the musk offer worth right now about $40.30 i don't know if i would buy the numbers. it is not -- it is not known if twitter has to believe it. is he the partner or the adversary? we talked about how we don't believe he has any right to it

he said i'm not doing due dili diligence. i'm past that. he wants the data. i imagine the only thing he can do with the data is use it against you. >> i think what they gave him was not just here on the bot numbers, but gave him access to the string of tweets lots and lots of tweets. the fire hose defense that lawyers take you want information here you go. deal with it try to figure it out their question has to be is he going to agree to the nda and say he is not going to give the information away he tweets about a lot of stuff here it is if you have an algorithm to see if it is a bot, go ahead. >> there was data that elon musk

relied upon and is now false >> you can argue both sides. it was in the s.e.c. filings >> i learn things from guests. did he not make a dent on you, andrew >> he did. i have great respect for joe he makes me think about a lot of things >> i hear a big but coming >> i was not persuaded >> you have never been persuaded on anything. let me know when you are finally persuaded on something >> if you look at the language that twitter published publicly around bots and ratio, it is a -- i think what you will find is that ratio will prove to be accurate, but what elon musk is saying about bots running the place and all sorts of things going on, that will also prove to be accurate it will not discount what i

believe was publicly stated. >> what will happen? does he do it or does he do it >> does it for cheaper i don't think there is an option there's not an option. >> $30 billion >> the question is if you are the board of twitter, what is the right price? would you wait two years to get your $44 billion and then discount that by the time it will take the mess it creates and all also legal fees on top of that? >> the board's only other option is to walk away. it is not supported. >> what's the low? >> you take the $44 billion and suffer through the fight for two years. then try to account for the risk you lose or you take what? whatever math you do is the

discount it is not what's the thing worth? we had venture capitalists say it is worth half of what he is saying if you are the board >> where it was before we thought elon musk was going to buy. >> 30% less. >> the business looks worse than what that place is implying. >> totally >> where is it going in the 20s >> i think in the 20s easily >> that's why neither side is going to give on this. it is going to take years in litigation to get through it >> i think the twitter board does give. the question is how much >> we'll negotiate down? >> absolutely. would you -- it depends on how much we're talking about if it is $5 billion less, you take that and run for the hills. if it is $20 billion less, you say i'll hold you to it. i think and i don't know where

the math comes out >> once you blink, then there's no going back. once you say it is worth less, you can't say never mind that's the price >> not really. i think you negotiate. you can say we're prepared to talk to you. if you come up with the right price or price we're willing to accept and do that, if not, we'll go to court and see you in court. we'll take the $44 billion i think that's how this goes >> could be. coming up, futures are up 75 that doesn't get back to what happened yesterday we will talk strategy and get you ready for the big inflation data we hope it is not too big. first, here is a look at shares of exxon they did that because there is no other word anywhere you don't want to name something like fart in a foreign language.

it has happened before the company -- i can't emember every exit in germany is an asfaurt. it is worth $135 at the lows in the pandemic lockdown. the stock trading at an all-time high now you are watching "squawk box" on cnbc >> announcer: this cnbc program is sponsored by ibm. ibm. let's create o un-sil your and start crunching a year's worth of transactions against thousands of compliance controls with the help of ai. now you're making smarter decisions faster. operating costs are lower. and everyone from your auditors to your bankers

feels like a million bucks. let's create smarter ways of putting your data to work. ibm. let's create 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, so you know all you need for recovery. and you are? i'm an investor...in invesco qqq, a fund that gives me access to... nasdaq 100 innovations like... wearable training optimization tech. uh, how long are you...

i'm done. i'm okay. this is ashley. she's a posh virtual receptionist. she'll make sure you never miss a call or an opportunity to grow your business. you can't be in two places at once, let posh answer. posh virtual receptionists.

when it comes to cybersecurity, the biggest threats don't always strike the biggest targets. so help safeguard your small business with comcast business securityedge™ it's advanced security that continuously scans for threats and helps protect every connected device. the choice is clear. get unbeatable business solutions from the most innovative company. so you can be ready for what's next. get started with a great deal on internet and voice for just $49.99 a month for 24 months with a 2 -year price guarantee. call today. as a business owner, your bottom line is always top of mind. so start saving by switching to the mobile service designed for small business: comcast business mobile. flexible data plans mean you can get unlimited data or pay by the gig. all on the most reliable 5g network. with no line activation fees or term contracts... saving you up to $500 a year.

and it's only available to comcast business internet customers. so boost your bottom line by switching today. comcast business. powering possibilities.™ let's delve into the markets now. fundamentals for this discussion futures indicating a gain of 80. let's bring in victoria fernandez. the market is not all technology, victoria, but we sure do love it. investors love it. it gets a lot of attention the article du jour in the journal is tech's dominant decade in the market fades does that mean it will keep fading or does that mean, wow, everything's on sale that we loved a year ago >> joe, i would be in the latter

camp on that that doesn't mean you jump in with both feet our focus with the volatility going on in the market is to focus on quality of the balance sheet and earnings you look at some of the high growth names in the tech space valuations have come down. names have come down you know they have strong cash flows and long-term holdings in the portfolio. you go in and buy names. microsoft and apple are still two of the largest holdings in the large cap strategy that hasn't changed. that doesn't mean we don't go in and buy other names. we like the old school names you have the longer, slower growth potential with less volatility you look at intel. that has come back with the news you look at the name of texas instruments. you be choosey

>> if you recall when we were awaiting for yields to rise on the ten-year, waiting, waiting and waiting. everybody knew they were going up everybody said watch out for tech tech is the area where multiples are high they will be effected. that is trouble for tech that is what happened. almost as we have seen from 2.25% up to 3% we shouldn't be surprised. predict what goes on from here what if we stop at 3.5%? >> the equity market finds a footing. the tech names are long duration stocks when yields move higher, we see the prices effected more than value names that are short duration we think yields have found a range in the 2.80% to 3%

we actually think the highest we might go this year is back to that intraday 3.20% level we saw in may if that is true, tech can find a trading range to be in that is what we are looking at it should support the equity market the cpi number cometomorrow coub a game changer if it is higher than people expect, you see yields come down a bit. >> we also started separating out food people do that people are bullish on oil. i don't know if that means they will be right, but fund amentall and technically, it will go above 130 or above 140 maybe it doesn't are there other positive signs in terms of inflation moderating

in different areas can we handle that if oil goes on to 145? that could mean interest rates need to go higher. >> absolutely. energy is the leading sector and that leadership has not changed which tells us month over month inflation may not have peaked. i think year over year with cpi and the core numbers, yes. that has probably peaked it is month over month we want to see peak. with energy as high as it is, i'm not sure that happened we have the labor market moderating with the numbers last week we have durable goods prices that are moderating a little bit. supply chains are starting to look a bit better with china reopening. all of thatshould help bring inflation numbers down a little bit and including in the housing market i think with all of that together we don't get a recession and have a better opportunity for a soft landing that should help give the fed a

bit of room to go 25 basis points in september although we have been hearing the fed presidents say they are not ready to go out route yet. >> you are a long time viewer of "squawk box" and i said durable goods because you can't prove it it could be durable. you said it. you why needling us for watching us for years, victoria thank you. chief market strategist. what is your number on the cpi what would be a friendly number? what would be a bad number >> i think as long as we're lower than where we are. low 8 or high 7 would be positive for the market. >> victoria, thank you >> hard to imagine as long as it is eh, 7.9

i have a hard time thinking anything will be something we look at with relief on friday. >> the fed forecast for 7? >> maybe not that was for fed >> 2022? >> for 2022. >> yeah. we will see. coming up, a lot more to talk about here new regulations in focus, including one proposal to limit the use of non compete clauses by companies we will talk about it next. later this hour, former s.e.c. chair jay clayton with the proposed rules that target robinhood business model specifically payment for order flow that controversy is heating up "squawk box" is coming right back en ponsor a job you immediatet your shortlist of quality candidates, whose resumes on indeed match your job criteria. visit indeed.com/hire and get started today.

i didn't realize my dna could tell me if i had a higher chance for type two diabetes.

so when my son gave me a 23andme kit, it was a wake-up call. this father's day, start a new health journey together with dad with $50 off every kit. and it's easier than ever to get your projects done right. with angi, you can connect with and see ratings and reviews. and when you book and pay throug you're covered by our happiness check out angi.com today. angi... and done. in one second, sara... -yes! ...will get a job offer somewhere sunnier.

relocating in weeks. weeks? yeah, weeks. gotta sell the house. don't worry, sell to opendoor, and move on your schedule. yes! get your competitive offer at opendoor.com

woelcome back to "squawk box. the non compete agreements bar an employee from joining a competitor associated with higher paid salary employees companies using them for hourly workers. companies that use them say it protects intellectual properties by preventing employees from sharing them with a new pla employer what do you think? >> phenomenal take for lena. great idea >> you are for getting rid of non compete? >> duh

>> why is that >> i'm joking. work with me, andrew in case any of us decide to wait a year you didn't think about that? >> as the great free marketeer you are would think it is a great piece. >> i understand. >> i think it is a good idea i know hairdressers in the area and salons say as soon as you walk in the door, you sign the non compete. you cannot compete 25 miles from us for the rest of your life that is really unfair. >> yeah. yeah listen to becky. >> i've seen it play out in a way where you understand this is not just big contracts there are huge swaths of the population that get caught up in this it is very unfair. you can't work here unless you

sign sdp sign. >> competition is good we shouldn't have non competition. >> it is free market competition. >> the free market should say i think if you are a hairdresser and you will come and work at this store, i can offer you two prices i can offer a high price in which case you cannot take people with you. or a lower price >> they are not offering the price. it is not just you can't take anybody, but you can't compete i don't know it allows competition. i'm more in favor of it. >> i had someone send it to me first thing i thought, maybe she's not so bad everybody thought the same thing. elsewhere, facebook taking the final step to change identity changing the ticker from fb to meta the move reflects the change to

meta platforms and change the focus to the metaverse the company halted development on a much rumored smartwatch it was supposed to feature two cameras which was expected to debut this summer for $400 you would be a spy hi, becky. with your watch. your camera on the watch >> and in glasses. you never know be careful what you say. when we come back, average gas prices climbing closer to $5 a gallon this morning. we will talk with goldman sachs jeff currie. we are celebrating pride month. here is andrew clarke at f fran francesca's. >> it is more important than ever to celebrate pride month. pride is the moment for us to stand up and represent our community while standing alongside other minorities in

the celebration of the defense of diversity and equality in this country pride is happy pride is positive. pride is serious and pride is necessary. >> announcer: executive edge is sponsored by at&t business at&t 5g is fast, reliable and secure our best deals on every iphone - 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. ♪ ♪

meet jessica moore. jessica was born to care. she always had your back... like the time she spotted the neighbor kid, an approaching car, a puddle, and knew there was going to be a situation. ♪ ♪ ms. hogan's class? yeah, it's atlantis. nice. i don't think they had camels in atlantis. really? today she's a teammate at truist, the bank that starts with care when you start with care, you get a different kind of bank.

good morning welcome back to "squawk box" live from the nasdaq market site in times square. checking futures this morning. basically doubled their -- you know, to 150 from 175. the nasdaq looking better. up 103 the s&p up 24 points we'll be talking about inflation and tech stocks in the market all day long. >> and energy prices the other thing that is ticking higher pushing up prices at the pump as well exxonmobil hit an all-time high. gas prices creeping closer to $5 on average across the country.

joining us to talk about it is jeff currie at goldman sachs jeff, we welcome you here with mixed feeling. you have been right for con sie sumers energy prices continue to crime. energy stocks continue to climb. you think there is any end in site to extra trend? >> we like to argue the first innings. it is met als and agriculture. the industry has suffered. exxon is reaching a cyclical high, but the reality is the amount of money in the space is very, very small we have not seen the rotation. the only money coming into the space is share buyback you look at energy up and tech down, but reality is we have not seen a big influx of capital

into the space are you too late absolutely not it is just beginning >> is energy the new leadership? we are talking about it getting closer to about 5% of the s&p 500 up from 3.5% it is still far off the highs where we had seen it 10 or 20 years ago. >> by the way with, when you look at the earnings, the revenue, it is 9% of the s&p the fact you are at 5 under scores how under invested the space is it is a huge capital mis misallocation. if you want do go out and grow shale production, you are out of sand and pressuring pumping capacity all of the capital heavy industries have suffered from under investment not just for the past couple years, but a decade and some cases all the way back to '08 and '09.

this is payback from under inve investment >> what is the catch up in what we need to invest and what we need to be produciniproducing? >> the problem is the volatility trap the higher the volatility, the less incentive people have to put in the space that exacerbates the problem and creates the vicious loop with higher volatility. you know, the question is what's going to stop this high, high returns can do this they are not high enough to get people to go into the space. when you go out and survey investors and why they don't want to put money into the space. the reason number one is history of poor returns. less than two years ago, the losses in the space were nothing short of epic with negative prices reason number two? voluatility is few high.

a few months ago at 98 and 140 and back to 98 you get the point. volatility is high then, reason number three is esg. esg is below the history of the space. i ask what will get capital to come back? the answer is a three-year track record into the space. we are 18 months into the track record. >> administration has all kinds of plans to try to bring down inflation. i don't know that anything they said will do anything to impact prices particularly at the pump or grocery stores soon gina raimando said there is nothing the administration can do is that correct? could they change? >> it is a global problem. it is combined very much in with climate policy it is climb as well as energy put together in the current environment. one country creating an

environment to solve a global problem. what makes commodities different from other asset classes and other sectors is they are global in nature. the policy of one country impacts the global market very small. you have to have a global policy systematic way this in a when you look at what germany is doing. the impact that germany is having on the global market is significant. turned back on coal plants importing coal from the united states that is putting support into u.s. natural gas this cannot be done in isolation. i'm talking about something that is difficult todeal with the policy needs to be really global in nature to really deal with the problem >> if germany could have an impact, one nation alone, why couldn't the united states at to that in a big way? >> the impact is more on the negative side than the positive side meaning they credit a bid in

coal they are turning back on coal plants which creates more emissions. you think about that impacting u.s. natural gas it is impacting the u.s. on decisions made in europe i talk about they can do it unilaterally, but to the negative to overcome the problems and solve them, there is a cost. there needs to be a cost of turning on the coal plant and there needs to be incentives for solving this on a long-term basis. one country to do this is difficult to do unless you get the rest to screen in and do this on a more broader scale the statements they make are true to a certain extent unless you get the rest of the world to sc join in. >> jeff, i'll speak with janet yellen later this morning. she talked about buying cartel, but specifically a buying cartel in europe that would impact the

way china and india behave it has a diplomatic conundrum. you would have to sanction india and china if they were not to participate in the cartel the way you want does that seem like something feasible >> oil is an incredibly competitive market both on the supply side and the demand side. not one entity has enough market share on the supply side or the demand side to be able to push these. that is why opec has a hard time creating cartel-like behavior in this truly oil is incredibly competitive market any talk of cartel on the supply side or demand side is incredibly difficult to implement. the only time you have seen success behavior was following march of 2020 when you had a collapse of demand on that scale and everybody impacted you saw the behavior it was forced because of

negative oil prices than on collective behavior. i like to point out, this is a competitive market one of the most competitive markets and behavior is difficult to establish i don't want to take strong views on the policy. i want to point out there is a come pepetitive market. >> you say we are 18 months into the three-year cycle and then things drop back down or 18 months of super spike? >> when you think about what -- what will get people to allocate capital into the space is they have to know the bad period from the last decade is behind them and they want returns. we started making the call of the commodity super cycle in october of 2020. that is roughly 18 months away if we think about a three-year track record, you need 18 more

months before the money flows. in 2000, the super cycle started and it took three years. it takes three years for people to forget the memory of epic losses before they allocate. >> that means allocate, but still take time for the allocated money to work its way in to higher production. >> the reason why i think is a ten-year super cycle three years of a track record and three years of spending inflation and then three years of investment. in years 10 and 12, you bottleneck the system. that is why it is 12-year super cycle. >> that is an inflationary outlook for a long time. great for investors if you put money into the assets. not great if you are a consumer. jeff, thank you. we'll check in with you. you have been right, unfortunately. good to see you. >> thanks for having me. when we come back, new reports say another major tech

firm is freezing its hiring. we have the details after the break. and later, more on the markets and inflation from mario gabelli. "squawk box" will be right back. >> announcer: what's working is sponsored by comcast business. bounce forward at comcastbusiness.com. an what if you were a global energy company? with operations in scotland, technologists in india, and customers all on different systems. you need to pull it together.

so you call in ibm and red hat to create an open hybrid cloud platform. now data is available anywhere, securely. and your digital transformation is helping find new ways to unlock energy around the world. ♪♪ making friends again, billy? i like to keep my enemies close. guys, excuse me. i didn't quite get that.

i'm hard of hearing. ♪♪ oh hey, don't forget about the tense music too. would you say tense? i'd say suspenseful. aren't they the same thing? can we move on guys, please? alexa, turn on the subtitles. and dim the lights. ok, dimming the lights.

welcome back let's look at the u.s. equity futures at this hour dow futures up 144 s&p futures up 20. the nasdaq up by 76. news just out from retailer target announced a 20% dividend hike. raising the quarterly payout to $1.08 from 90 cents. this is after target announced excess inconvventory would cut o the profits before rebounding this year. the stock is up 1% this this was a big week for target announcing that news a board meeting and met with wall street yesterday and now announcing a dividend hike of 20%. >> brian, when he was on last time >> brian cornell the ceo. >> yeah. >> he recounted the history of dividend increase. this is in keeping it is some stretch with the

financial crises and it went through pandemic it went through all that i don't think it was ever interrupted. this goes in keeping with that you think they would do it anyway put a floor under the stock? >> they wanted all the bad news first and meet with wall street and here is the sweetener. when we come back, a lot more on "squawk box. payment for order flow could disrupt the free trading platforms like robinhood we have jay clayton coming up next and this afternoon in washington, a special book event. i'll speak with janet yellen and starbucks founder howard schultz in the first interview since returning as ceo and senator chris murphy we will have highlights ctomorrw

morning. we are right back after this >> announcer: currency check is sponsored by interactive brokers. the professionals gateway to the world's markets.

i didn't realize my dna could tell me if i had a higher chance for type two diabetes. so when my son gave me a 23andme kit,

it was a wake-up call. this father's day, start a new health journey together with dad with $50 off every kit.

welcome back to "squawk box. joining us is jay clayton, former sec chair, good morning to you i know there's an issue we've talked a lot about coming out publicly, taking aim at payment order flow in a meaningful way do you think it goes away, and should it go away?

i think we're have ago ing a lie bit of audio trouble, jay. we got him back. >> hey, andrew, payment for order flow is just one component of retail interaction with a very complex train let me break down retail versus institutional. in our trading system, we've got all sorts of institutional trader, all sorts of venues, lid exchanges, dark pools and intermediaries like whole sales. that, to my view of how to look at this creates what i would say is a ceiling on execution across the market place generally, retail investors, the way our market structure works have been able to come in under that ceiling in terms of execution and quality. there have been amazing advances in access to our retail market

place. i agree that we need to continue to look at that. are we continuing to bring it down with technology, data information, resilience and fairness okay payment for order knoflow is on component. that's the debate we're seeing >> i guess the question, though, is, payment for order flow, effectively has al loulowed the robinhoods of the world to offer free trading or what seems like free trading they're taking a couple pennies on each trade because you're not getting the best possible execution. it's in effect transferring the payment, if you will, via that mechanism as opposed to up front. the question is, if you would take the payment for order flow piece out of it, do you believe

it changes the model foru all these companies, these brokerages and leaves people more involved in the market, and is that a good thing >> really good question, andrandrew the question is are we looking at that time in enhancing retail for investors across the market place or applying some kind of criteria we don't like gamification we need to look at it more closely. or payment for order flow allows for zero commission trading, which brings more people into the pamarket place so you need to separate the efficiency to retail investors from some of those other policy questions. and we need to look at addressing those other policy questions. greater access for individuals or is there, is there too much

of an incentive. are people too juiced to trade we need to look at those, not just in terms of order type, but other information in the market place that helps people make better choices i think you need to separate those two and be very rigorous in your analysis >> and what does your analysis say about that if you were advising gary aga genzler or congress, what would you be telling them? >> we've done this in the past in this very complex ecosystem let's get people around the table to discuss this. chair genzler's done a great job of outlining six things that need to be looked at this was just one of them. let's before we make any proposals or judgments, get people around the table to discuss what just you and i were

discussing >> if are you a public investor in robinhood or a customer of robinhood but do it as an investor, would you be telling them, this is an existential threat that has a high degree of likelihood of killing this business, or this business model as it's none today, or do you say, i've been around washington long enough, this isn't going to happen >> one of the great things about this country is we do have due process and open debate around these types of issue regulation is almost always an existential threat to business that's why we do these things in an open and deliberative way people will be able to make a choice about the type of business model that they select. >> can i just throw you a random curveball? we were talking about elon musk

earlier in the hour. you're a great counselor so you'll have a view on this. if elon musk effectively said, basically said, i'm giving up, i'm waiving all diligence on this deal, does it matter what kinds of representations were made by twitter? >> andrew, i am not versed in every bit of the contract. but there is a difference between waiving your process around due diligence and covenants, you know, covenants made in a contract to provide information going forward. i think, i actually have very little critique. i was able to listen in. i have very little critique in the way that you, becky and joe outlined where we are, which is is there going to be a negotiation over price as a result of the bot question >> jay clayton, thank you,

counselor. appreciate your perspective on all of it. >> good to see you >> we appreciate that he watches the entire show. >> yes >> mandatory mandatory. thank you, sew the fcc commissioner, ajit pai will join us when we come back dave doesn't need a posh virtual receptionist, because he cloned himself. while his clone watches the phones, dave can work on his code.

and lead his team. dave trusts his clone like he trusts himself. so, in summary, we're going to sell the company. who's in favor?... perfect. but if cloning isn't an option for you, just get posh. virtual receptionists who can answer and transfer your calls, because you can't be in two places at once. how will your business adapt to change? you could hire an office full of peyton mannings. what's up, peyton? good morning, peyton. hold for peyton. they'd huddle.... welcome to the peytonverse. such a visionary. game plan... you go. no, you go! and call audibles... double our investment in omaha! omaha! omaha! omaha! or you could use workday. omaha. the finance, hr and planning system used by over half of the fortune 500. for a be-agile-like-an-mvp world. workday. for a changing world. c'mon caleb, you got this! and if you don't, there are other options! umpire: ball! good eye! good eye!

eyes are good for lots of things. like reading! be the best, caleb! statistically impossible, caleb. umpire: strike three, you're out! you'll get 'em next time! or you won't, probably won't. and it won't impact your future whatsoever! talk to us about college planning today. feel comfortable about tomorrow. massmutual.

good morning the bulls look to battle back from yesterday's down session. u.s. economic data and a decision in europe front and center among our special guests this morning, and break news, china denying a report that it was preparing to green light the ant group ipo. plus, developments in the twitter-elon musk drama. the social media company reportedly ready to give access to internal data we will talk to ajit pai as the second hour of "squawk box" begins right now >> good morning, and welcome to "squawk box" right here on cnbc.

i'm andrew ross sorkin along with becky quick and joe kernen. at this hour, still about two and a half hours before the markets open but we are set to open higher on the dow. 67 on the nasdaq s&p up about 20 points couple big headlines to bring you. european central bank is set to issue its latest policy statement, expected to end years of monetary stimulus meantime, abbott labs warning of problems at its michigan baby formula plant was months earlier than reported, now a former abbott employee had filed a whistle-blower complaint alleging a host of problems, including equipment. it was shut down earlier this year helping spark what has

turned out to be a nationwide shortage and massachusetts trader joe's location has filed for union. we've seen unions form at starbucks and amazon so we've been seeing this trend play out across the country. >> we have now to this morning's market movers d dom chu still with us. he has not left for the new golf tour looking for dom, how are you doing, dom >> i haven't gotten a call yet so i'm going to keep my day job here at cnbc let's talk about some of the elements developing right now in the premarket trade, and they're centered on chinese-related

being wit. the equities. we're now down 3.5%. we were solidly higher about an hour ago but we had headlines out of bloomberg that they were looking to restart the process around a possible ipo of jack ma's fintech. we kind of went to gains here and the range has been fairly wide with with regard to what's happening to alibaba then we have chinese security regulators coming out and saying for the record in headlines that they are in fact not looking to do anything with this ant financial ipo. that's the reason why you're seeing that big swing interday on alibaba shares. that's also carryiniying over i

other internet names but these are three of the biggest names in the nasdaq00. they've gone from swinging positively to now negatively on the day so far and k webb also moving down on the session as well on those kind of headlines. first positive and then negative for chinese internet then you've got another chinese technology name, liberelectric vehicle maker, nia and the revenues were better than expected, but if's investors concerned. and then turning to our ev makers, specifically, tesla, the

biggest one out that's correct those shares up about 3.25%. tesla might be getting a little help from analysts at ubs who have taken this stock up to a buy rating they keep their $1100 price target they like the momentum much of that positivity, they say now is the time to be bold buy tesla shares >> the futures are indicated higher up about 141 points in the premarket. joining us is sawrorat sethi >> this has been an interesting week you had the concerns of target and walmart and beyond

cpi numbers tomorcoming tomorro. >> i think, becky, it has been a lot of data this week. bad news is good news. because the inventory is just another sign that things might be slowing down, we might be getting less inflation i think tomorrow's number's really important what is the second derivative of inflation, and if we see any sign of it coming dournwn on the other hand, if inflation is not coming down, you could expect money to come out of the growth sectors, because that's kind of where people are putting a lot of bets on >> could you be looking at a tale of two cities if you're looking at core inflation, maybe that moderates some, but core inflation doesn't include energy, tan dand it doet include food

those are two things that everybody has to buy are you watching headline? core, does it matter if one moderates and the other doesn't? >> at this point it doesn't really matter. people are going to be looking at where are we going with this, and if it's core or something else and if you see any kind of, we know oil's not coming down for the near future and food probably isn't coming down either but if you see rent and used cars coming down and inventory coming down, and china reopening as well. supply's going to come down. you've already seen shipping prices come down things like that are helping the fed. but if you see a stronger number, the market's going to pull back some more from here. i think there's some really good companies out there that you can still invest in. and if the volatility gives you an opportunity, great. you could buy morgan stanley at ten times.

in order to trade through it, the short term as going to be a little rock eon y on the up andn the down >> we talked about target this week, with the 20% increase in their annual dividend. you're talking about 2.8%. do those yields start to interest you or is this where we don't know enough about the consume are yet thaconsumer yet, and you want to see the paper on the second half. >> there are a lot of other areas, if are you a dividend investor, can you say hey, do i want to be part of a company, like amex is growing it might be easier to trade around but especially as a consumer is now spending money on services they're spending money on travel, hotels

i think opportunity's there, whether you want to invest in uber that's focussed on cash flow and reopening i would stay away from some of these stock, especially those focussed on inventory that the consumer isn't going to anymore. >> energy has been the best sector of the year wti is about 60% we just had jeff currey on had but if you're looking at energy with the gains woe've see to this point, we're at about 5% from an earnings purpose they m make up 9% >> i think energy's been a great

sector we've been a little over market weight on that but i'd be a little careful here because good news in the economy could mean that money moves away from the sector and bad news means demand is going to come down these companies have done a great job in terms of leverage, in terms of buying back their shares they have not done what they did in the last cycle which is go to spend money and grow i like the chevrons of the world, the e soxxons of the word even though a lot of new money hasn't come into the sector, it's one of those things that has done so well, i would be careful. i would dip my toe in, but there are speculative areas that have done very well the trader can get in there, but the investor needs to be careful because you are chasing it at this point >> sarat, thank you. coming up, chuck robbins on one of the biggest issues facing

the tech industry right now. but first, as we head to a break, check out this morning's biggest s&p leaders and laggers right near on cnbc ear on cnbc. hc . . you'll always remember buying your first car. but the things that last a lifetime like happiness, love and confidence... you can't buy those. but you can invest in them. at t. rowe price, our strategic investing approach can help you build the future you imagine. i'll take celebrity endorsements -you should buy crypto trust me, i'm an actor - i'm in! (buzzer) -[narrator] investing is not a game so, be careful where you get your advice do your own research at investor.gov before you invest, investor.gov

i didn't realize my dna could tell me if i had a higher chance for type two diabetes. so when my son gave me a 23andme kit, it was a wake-up call. this father's day, start a new health journey together with dad with $50 off every kit. this is xfinity rewards. this father's day, start a new health journey our way of saying thanks, with rewards for the whole family!

from epic trips... to jurassic-themed at-home activities. join over 3 million members and start enjoying rewards like these, and so much more in the xfinity app! and don't miss jurassic world:dominion in theaters june 10th.

welcome back to "squawk box" this morning cisco's ceo weighing in on soar the inflation. here's robbins with jim cramer last night >> i think there is demand softening in certain parts of the market, pcs as an example. and so you're seeing some components that are becoming available because of that. some of the stuff that we all kind of go after together. >> and cisco shares are down nearly 30% year-to-date, becky >> i think this interview with jim was so important, after what we heard from cisco just a few weeks ago, too same thing with brian cornell and target, getting these updates, because things are changing so rapidly in areas where you're dealing with the consumer or lockdowns in china appreciate hearing from these ceos, giving us these updates, and i think it's really great investors are following this stuff really, really closely

we'll get a chance to talk to jim about it a little more this morning and get lhis thoughts as part of the adjustment, the chip maker is imposing a temporary hiring freeze at its client computing group a hiring freeze would be the latest in a string of similar moves we've seen from other technology companies including uber, meta, coinbase and robin hood, and this has people wondering, how strong the job market is going to continue to be obviously, it depends on the arena you're in. but at this point, all of this news is super important to watch just for the broader trends in the economy. coming up, are some companies falling into a trap, allowing founders to keep too much control we debate that issue on this week's "on the other hand" segment. check out oil prices this morning. they have moderated a little below 122 now.

that's 121.91. time now for today's aflac trivia question. donald duck first debuted on this day in what year? the answer when cnbc's "squawk box" continues the aflac pre-pain show. aflac! paul is about to suffer a shelf-inflicted injury. luckily, aflac will help cover his unexpected medical bills. aflac! maybe you could use the money to buy a step stool. i have a step stool. so why are you climbing a shelf? the stool's on top of the shelf, isn't it paul... (shelf crashing) yeah... ♪ ♪ aflac!

i'm here with these low handicap golfers to put the maxfli tour balls to the test. ♪ ♪ nice shot. and it sat down nicely, huh? how did it feel compared to the ball you play? i like the feel right off the face. now let's go to the bunker. just like the one that i play. just as good, if not better. the driver.

more poppy. more penetrating. it feels like a tour ball to me. it's a little bit straighter. let's see it on the greens. i like the shape of the dimples. nothing like a nice dimple. maxfli. tour quality performance without the tour ball price. your shipping manager left to “find themself.” leaving you lost. 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

now the answer to today's aflac trivia question. donald duck first debuted on this day in what year? the answer 1934 the character made its first appearance in the disney cartoon, "the wise little hen. >> all righty then >> do your duck. >> no, i only do that for children >> me. >> shareholders voting to give the company's founder and ceo special rights to boost his voting power other internet stocks like meta, pinterest and snap have big founders is this too much control shopify's founder, jon fortt is here to weigh in definitively.

>> yeah, no, it's not too much control for the founder. this is protecting what's important about shopify for the long term. shopify gives small businesses tools to build and run their own online stores. the company was started 16 years ago before the financial crisis when the conventional wisdom that he was wasting hess time. today shopify plays an important role, giving shoppers more control over their destiny here's why tobias lutke needs this shopify is spending billions of dollars to scale upp its fulfillment. in the short term, shopify's plans would make the company vulnerable to short sellers and

takeover attempts. that's why shopify shareholders did the right thing and gave tobias breathing room. >> if you don't like the idea of being public, don't go public. >> that is true. on the other hand, this is not so much different from giving authoritarian power in a democracy. this is too much power for shopify's founder. we've got to get out of this mode where with innovative companies, the only way they can save them from short-term thinking is hand over our rights you know who doesn't have shareholder rights jeff bezos but he's built a reputation. shareholdersi shareholders listen when they want to do something i know the markets have changed in the 15, 20 year since bezos and jobs were making their bets.

what have they done that they couldn't have done without sergey brin's control. and companies are innovative, and their founders are valuable, but these special classes are creating a market where rich overlords are having to convince the shareholders who made them rich in the first place. >> it does seem if you've got the goods you don't need someone telling you that you have voting rights people are going to go along with you >> sometimes i start off writing these thinking one thing and i end up thinking another thing. this is tough. >> if shareholders vote to do it, who cares. as long as you ask permission. it's not like they get to do it in an undemocratic manner.

that, to me, is the biggest issue. if you brieelieve the founder cn protect. like a bezos and some of the other guys, they've explained what the deal was. you knew what you were getting before you signed up for that. >> there's a culture in markets, though you end up with pinterest, maybe they're wishing that, the super voting shares in pinterest weren't what they are at this point. i don't know >> jon, thank you. it gives us a lot to think b always enjoy when you present both sides still to come, we'll be speaking to former fcc chairman ajit pai plus, arthur brooks joins us, and we'll sound off on inflation, energy price and much more stay tuned you're watching quk "sawbox," and this is cnbc

mom: how was school? dad: wow! ♪ vo: music can help you express how you're feeling. when you can't find the language, find the lyrics. good morning welcome back to "squawk box. we are live from the nasdaq market site in times square. we've picked up a little bit of steam over the last couple hours. dow futures right now indicated

up by about 150 points, the nasdaq up by 73. and that is almost making up some of the losses from yesterday. not quite. the dow was down about 269 so we are picking up a little bit of speed we'll see what happens as we get closer to the opening bell among our top corporate stories, target announcing a 20% dividend hike, raising the quarterly payout this comes after they indicated that profits would be cut into the stock up about a dollar this morning. twitter going to be ehlon mt

accounts this is a very big deal, and may change the outcome we'll see. joining us right now, ajit pai, former fcc chairman. and a non-resident fellow of the american enterprise institute. good morning to you. you think this is game changing. >> i think it's a significant step by the twitter management to give elon musk more information to stave off, two, i think material risks the board was worried about. number one, the risk of a renegotiation of the price and the risk of litigation over the merger agreement >> when you look at this merger agreement. one of the things that everybody's been so fascinated by is that elon musk effectively waived diligence and early on, we should also say that he said one of the reasons he was buying twitter was because he thought it had a bot problem. if you were going to litigate

thei this case, do you think twitter has the better side of it or elon musk? >> for starters, you've put your finger on one thing, they call it due diligence for a reason. a lot of people spending money to buy a company want to know every nook and cranny of the business now that there is a merger agreement, what are the grounds for musk potentially walking away from the deal and there are essentially two of them one has been covered a lot in previous weeks is representation that has a material adverse effect on the company. the newer one, the reason why i think twitter is handing over this data about the 500 million daily tweets that come out, one of the things twitter said, we will provide you all the information you need to understand essential litly the of the business. and the letter that musk's lawyers sent, there might be a breach of the covenant because

he's asked for it for over a month and they haven't handed it over that's part of the reason that twitter has done this. this is not the entire denominator of twitter users twitter's business is based on monetizable daily active users there are a great number of accounts that are essentially silent they do internal analytics in analyzing who are some of these people that leads to whether they are bots or not this is a very important step forward. but it's certainly not the end of the conversation in terms of the quantum of information that musk is presumably going to want >> do you briefelieve, and mayb it's hard to know, whether twitter has been honest in its

accounting of this bot problem, relative to what musk says that they've been dishonest and he's encouraged or somehow we have the a.g. in texas l leading its own investigation into the matter, which i would imagine would help elon musk if he were trying to renegotiate or pull out of this action. >> a lot of people with anecdotal experience suggest there's volatility on one hasn't, twitter has represented that the bot activity was around 5% it's going to be very interesting to see what musk does with the 500 million tweets it's one of those things that we just can't know. and i'm hesitant to describe the

motive in the absence of evidence >> one of the questions is, as a negotiation, whether if you're the board of fittwitter, you trt hold his feet to the fire to pay the full $44 billion he will say, i'm going to walk, or i'm going to try to renegotiate this deal, and you say i'll go to court, or do you take a discount to that and say, you know what? i'll take $5 billion less, i don't know what you think the company is worth without elon musk's bid there how would you do that equation in your mind >> if i were a twitter board member, the way i would be thinking about it is basically around the framework it closed a little bit above $40. so as a board member, i think my

priorities are two fold in this order. number one, to avoid the risk of renegotiation, you want to stig seco to stick as close to that negotiation as can you. you know that the secondary priority is to avoid the risk of litigation you want to avoid that even if you win in court it's going to be two years from now, three years from now and it destroys a lot of share holholder value we can still capture significant value. i don't know, but there's a point where they have to be concerned that there's only so much we can do

the time value is almost as significant as the stock price itself that's a complex situation at that a board member would have i would think at this point. >> ajit, that sounds so complex. is there any way to prevent lawsuits happening this is mind-boggling to think of all the different things at play >> i think that from a company perspective, one of the things that is important for them to think about, what is the end game here? the end game has to be from at least it's governed by the board again to make sure we stick as close as we can to the merger agreement. if i were them, giving minsk the fire musk th fire hose is one thing if i were them, i'd say let's skip to the end game now

provide all the information, whatever he wants to be able to test whether or not this 5% bot estimation is accurate if it is accurate or a percent or two off, we don't have adverse effect and if there is a big bot problem, that's sort of a material risk to the business going forward anyway and you probably want to know that and disclose it to all the shareholders from a business perspective, i would want to resolve the uncertainty sooner rather than later. we don't want to be somewhere in the fall trying to figure out whether or not the merger's going forward. >> one of the things that's so fascinating is, if you took elon musk at his word and he was going to be your quote-unquote partner, that's one thing. the other thing is whether he's your adversary and whether any data you provide is going to be used to try to find an out in this situation.

that's what you have to imagine is happening here. it's hard not to think that that's what's going on and even if he signs an nda or any other kind of agreement, it's also clear reflective of recent past history that it's not clear, i should say, that he's going to stick to it. then your remedy becomes even more complicated because there's nothing you're going to be able to get from him for that >> it's very, very complicated there's no question that there seems to be based on public reporting a similarity between the way twitter has operated and the way that musk wants to approach it. oddly enough, they're linked by this merger agreement. in terms of finding that fit over the coming week the and months, and certainly once the transaction is consummated, it's a challenging transaction to consummate successfully.

>> it's great to see you appreciate it. thank you, sir >> thank you coming up, breaking news from the european central bank a rate decision is minutes away. first, as we head to break, check out the biggest premarket dow movers you're watching "squawk box" on cnbc

at fidelity, your dedicated advisor will help you create a comprehensive wealth plan for your full financial picture. with the right balance of risk and reward. so you can enjoy more of...this. this is the planning effect.

♪ it's a lovely day today ♪ so you can enjoy more of...this. ♪ so whatever you've got to do ♪ ♪ you've got a lovely day to do it in, that's true ♪ [ chuckling ] ♪ and i hope whatever you've got to do ♪ ♪ is something that... ♪ [ music stops ] [ beeping ] cars built with safety in mind, even for those guys. the volkswagen atlas with standard front assist. ♪ ♪

with come back to "squawk box. we're in the green s&p indicated up about 18, 19 points treasuries have been the recent bugaboo. this morning, 3.02 oil was at 122, it's now 121, 121.82 >> almost 122. >> almost. crypto, okay, is benefitting a little bit with the green.

bitcoin under 30,000. >> >some stocks to watch this morning after five below came in with better than expected forecasts, but it was the revenue number that missed it expects the macro environment to remain challenging but thinks customers will continue to seek value even more. stock market not loving it so far, down about 7.25% this morning. then you've got shares of sharp. take a look at that stock in the japan trading overnight. you can see right now, down by 5.7% this comes after the consumer electronics maker is projecting it's going to drop by more than 30%. they're citing a deteriorating

market for large lcd panels. meantime, thanks, becky, shares of tesla trading higher this morning ubs upgrading the stock to buy from neutral providing an attractive entry point. and despite recent stock struggles. cathie wood agrees she added 50,000 shares of the ev maker over the past two weeks to her flagship innovation fund. >> a little whiplash with novavax. a fda decision on approving the covid vaccine this week, it could be delayed a fda spokesperson telling cnbc that the agency needs to review

some changes in the company's manufacturing process. >> but that vote, i think it was 21-0 >> unanimous right. so it will get done. it's a matter of quality control. >> actually like baby formula. >> like we know now, baby formula. and disney shanghai will partially reopen tomorrow. several park locations will resume operations with limits and reduced hours. the resort has been closed since march 21st before shanghai went into the months-long lockdown visitors will be required to show the qr code and negative test policy decision from the ecb expected this minutes. plus, arthur brooks on the politics of inflation. and d.c., should or should it do

about it what should happen and ralater this afternoon, i'll be talking with janet yellin and starbucks' founder. and then senatorhr cis murphy. we'll bring you the highlights tomorrow on "squawk box. to satisfy cravings from tokyo to toledo? so you partner with ibm consulting to bring together data and workflows so that every driver and merchandiser can serve up jalapeño, sesame, and chocolate-covered goodness with real-time, data-driven precision. let's create supply chains that have an appetite for performance. ibm. let's create.

what happens if you ever need to miss work for a long period of time? why would i miss work? i don't know. you could sprain your ankle, throw out your back... get hit by a school bus. or a regular bus. get kicked by a horse. fall off a ladder. bathtub mishap. polio. boating accident. stuck by a fork. rabies. wolves. scurvy. talk to us about disability income insurance today. feel comfortable about tomorrow. massmutual. your record label is taking off. but so is your sound engineer. 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 when it comes to cybersecurity, the biggest threats don't always m strike the biggest targets.. so help safeguard your small business with comcast business securityedge™ it's advanced security that continuously scans for threats and helps protect every connected device. the choice is clear.

get unbeatable business solutions from the most innovative company. so you can be ready for what's next. get started with a great deal on internet and voice for just $49.99 a month for 24 months with a 2 -year price guarantee. call today. all right, welcome back, everybody. it looks like the ecb is making

its latest decision on rates it looks like it will be leaving those rates unchanged. it does say it's leaving its deposit rate unchanged at negative half a percentage point, however, it does say it does intend to raise its key interest rate by a quarter percentage point in july and they say they will continue to reinvest in maturing bonds and that it's ending its net purchases of bond under its app. >> that's about what we saw. treasury secretary janet yellen faced a second day of grilling on capitol hill. appearing before the house ways and means committee, she faced questions about soaring inflation and sky high energy costs. for more on this and the best path forward, let's welcome arthur brooks and a senior

fellow hosted the "in pursuit of happiness" festival, inspired by his writings and podcasts. his latest book is "from strength to strength." like right on the cusp of. thanks for joining us, and i didn't think about it. i used to always tom about pursuit of happiness you're in barcelona? >> i am. i'm at the business school in barcelona right now where i'm visiting some of my friends, giving some guest lectures on happiness, because we can all use it every place in the world, can't we, joe. >> you aren't going to talk about why you know avenue street and hot spot in barcelona? how long did you play french horn for the barcelona symphony orchestra orchestra or whatever it was >> years and years i came because i was chase ago

gchaseing a girl who didn't speak english. >> tmi tmi. >> tmi, tell me more >> the music career fizzled out. but we celebrated our 30th wedding anniversary, and we have three grown kids >> you succeeded unfortunately, we're in a dark period, and you say that the country's divided. it's tough to find happiness when it's so divided my question to you, can we ever make any strides when social media is so much part of everyone's lives, and it just gets, there's more and more of a cesspool every day >> well, it was certainly a big test for social media and the political situation, how the two things are related when we went through covid. ordinarily, covid is the kind of crisis that could bring the country together unfortunately, we have the wrong kind of political leadership in

america, intent on dividing us and using bullying and social media. i'm pretty confident that after a while, americans are going to be so miserable from the polarization and the true big lie, the person in the next house who doesn't vote like you is your true enemy, that sooner or later we will find leaders who can take us to a better place. >> all with the backdrop of the average american facing real pain at any retailer, gas or otherwise. >> no. j joe, there's three real pressures. and i'm sorry to say that the impending recession, that that's being politicized as well. the three problems hurting american happiness right now, of course increasing inflation, lowering real wages because of inflation and what's happening to people's pension funds. this is in no way limited to

what's going on with rich people and their portfolio. this is a real challenge for our country. >> i don't see either side offering any olive branches. it just seems like president biden just gets more isolated or his approval drops, he gets angrier and seems to point the finger at more causes that are out of his control for why he's in this condition, and the republicans, all they are thinking about is november and what they can say and do to try to usher in a red wave we can't expect anything good until november >> there's a real problem. when the strategy of both sides is captured by the most radical 5% of each party that are using fear you can have a country that has fundamental progress to move forward. but you have to trust and love each other this is a very common, this is a neuroscientific fact, not just a

philosophical one. but what they do in a fear-based p polarity is to capture that fear we need new politicians. we need more competition in the political market right now such that we can give people what 90% of us truly want, which is progress and compromise >> who's going to go moointo th business that hasn't got a screw loose. >> it's a real problem but you'll get some really entrepreneurial people who will walk into almost every market. it's tough, because it's a great 2 way to have people sort through your trash and get a lot of death threats. but americans, we do have a screw loose. you're going to see entrepreneurial people, and i predict over the next five years we'll have much more positive tone over people who are trying to be populace in a positive,

virtuous sense that want to increase happiness as opposed to decreasing it, that's what i'm hoping >> what if there was a meeting of the minds with people in washington had what should we be doing to try to heal and to try to move our economy forward and to try to generate prosperity and happiness, which you're always talking about, but it seems so elusive in recent years. >> yeah, it really has this is not the first time this has happened the united states goes through populist, polarizing political waves all the time the lies that go forward, the only thing that the political parties can agree on for example, they agree that capitalism has failed, which is a huge lie, that the american military is a force for bad in the world, that we should shut down with respect to trade and immigration and your enemy is your neighbor. that's what we're talking about. and when that is the agreement you get a whole lot of

bitterness and unhappiness there's so much good we can go do rahm emmanuel said you should n never let a crisis go to waste we should be talking about wonderful thirngs like energy expansion, and not trying to make the government more frush with increased traction revenues macro economically, i think it's clear. >> we can't even agree on what you mean by energy we heard someone say the answer's in solar and wind >> that certainly is an expansion of energy. but the crow compromise would mean more sustainable, more had

of everything. these ideas are being hijacked by radicals at the margins, trying to make us afraid of energy itself and negative and pessimistic about the future our future is unbelievably bright if we'll just take it we have the best possible world to come. our only enemy is us >> predictions are so hard, especially about the future. andrew >> you talked about radicals hijacking the process. i'm curious. for the business leaders out there that want to speak up on many of these issues, whether it's on energy on one end, roe v. wade on another or gun safety, for example, a whole b bunch of ceos put out a letter

but came out with no recommendation, i would argue in part because they're too scared to do so because they look at what happened in florida with that baseball team that literally said we're for gun safety and the governor there, desantis effectively punished them for doing it. so i think there's a very difficult place to be in terms of whether you have a perspective and when you can say it >> yeah. oh, for sure and look, when we're talking about the courage of ceos, let's not forget that a lot of ceos are being held hostage by radicals inside their companies. >> that's true, too. >> but that most of their employees don't even agree with and they're coming out with radical political positions that are alienating to consumers and different people in the economy. that's same problem. look, the deal of this basically is leaders are to lead with courage and love do the right thing for the american public, not withstanding your own personal political views.

don't be held hostage by politicians. have courage and certainly don't be held hostage bit y the most vocal and radical 6% one of the things, if you stand up to bullies, you almost always win. >> that's thing i can't get my h head around. what you're saying makes 100% sense and where i think most people live, in that same sort of mind-set. how have we gotten hijacked from this for so long >> part of it is that we're nae a fear-based society and fear-based culture everybody is afraid. leaders inle po particulars for example. the political parties are being led by bullies we even dislike bullies on our own side the problem is that when everybody's led by bullies, they're your bullies, is what it amounts to what we need to start doing is

have the leadership capability as community leaders and intellectual leaders to stand up to the haters on our own side. when people start doing that, you get radical cultural change. moral courage is speaking on behalf of those with whom you disagree to those you agree with and that's actually what business leaders should be doing right now and saying basically what i've seen a couple businesses start to do, which is, look, if you disagree with some of the things we are doing, you should work someplace else when we come back, mario gabelly. "squawk box" will be right back. blasphemy! fear not. these advisors managed one of the largest mergers in history, creating billions in value. billions? plus, they have experts in global trade. this merger shall be a boon for our spice business.

and set a course for growth. here, here! friars, send word at once. yes, m'lord. only at vanguard, you're more than just an investor

you're an owner. that means that your goals are ours too. and vanguard retirement tools and advice can help you get there. that's the value of ownership.

come back. -i always come back. can help you get there. ♪ ♪ breaking news, the european central bank say it's finally ending a long-running program of bond buying. u.s. futures are up, but it comes well off their highs we'll talk about the market, rates and tomorrow's report with mario gabelli. and news on target don't worry. it's not more supply chain pain, it's the company returning more cash to its shareholders

details ahead as the final hour of "squawk box" begins right now. >> good morning, and welcome back to "squawk box. we're live from a couple places, from the nasdaq market site in times square senator sorkin, that's got a ring sorkin it's allittive and everything. that is the most beautiful structure. >> it is >> and everybody looks good flex next to it and important and serious and everything he's got the jacket again.

i c he could not have the jacket >> ruin the formality of it all. >> which i tend to do from time to time with the show itself u.s. equity futures -- we all do u.s. equity futures are up some more than others. what is this, we were up 170 two seconds ago. now we're only up 50 but i guess we shouldn't be surprised, given the action we saw yesterday. this, the slow, steady decline that we've seen through some recent sessions. maybe that's part of it. 3.05 on the tenn year. that looks like a stopping point, perhaps, nobody knows is that just a stopping point on the way to -- >> depends on who you ask, jeff currie thinks so

if that's the case f it takes at least another 18 months to convince people to spend more on capex to get more out of the ground, that could be the case. the summer driving season, a lot of demand and china opening up again, means that globally, demand is going to be rising as well >> at least senator stabenow has that electric car. >> it's also the ecb making its latest decision on rates that just came out in the last half hour dom chu has the details on that. what happened, dom >> to joe's point, i'm not sure anything happened that wasn't unexpected but we'll take you through the headlines and get you a little framing for what we expect to hear in roughly 26 minutes when the press conference with krist kristine lagarde comes up. the re-fy rate stays basically

unchanged at zero. what will be interesting here is they do say, again, expect it that they're going to end the net purchases of their bonds under that asset purchase program, that a.p.p. they're going to continue in the maturing bond. so not an outright stop to everything here. but they do intend to raise that key interest rate by a quarter percentage point in july that was expected. they do also expect to raise that rate again in september, which was also factored in many ways into the market narrative so far they do see a gradual sustained rise in the key rates after that september time frame, and that september rate rise will depend on what else, the data, the inflation outlook. also, what's interesting here is they do see, they've kicked up their expectations for inflation, and they've kicked down their expectation for

economic growth on the inflation front. that's going to be more key here they do see inflation running at 6.8% in the year 2022, 3.5% in 2023 so the cutting of growth expectations maybe expected as well overall, what we are seeing right now is that move, you could maybe make the case, becky, that a lot of this stuff will be clarified in the press conference in about 25 minutes time, but a lot of the jockeying for position that you're seeing right now is maybe not as directly tied to the ecb but the u.s. inflation and cpi point tomorrow we'll bring you any updates with regard to the press conference when that does kind of happen. so that's the big headline news right now, becky i'll send things over to you >> the part of the statement that caught me the most. inflation pressures have broaden

and intensified. this is just a recurprecursor f tomorrow let's get to the broader markets once again mike santoli joins us now with what he's watching what you have been watching in recent sessions, mike? >> joe, you saw this little blip that you mentioned this morning. but it's very well contained and a narrow range the s&p 500, really sideways, about a 2% range from high to low is what we've been dealing with hard to make much of any clues until we break one way or the other. it also is about where we were trading at the very end of april, early may over that period, since then, obviously, oil prices are a good deal higher. bond yields are somewhat higher. naturally, the market absorbed the big rash of retail earnings warnings it seems as if you could make

the case that the value's working out okay or we're just waiting maybe for the next shocking number take a look at energy stocks compared to some other commodity-related stocks basically, they've disengaged. this is metals and mining. that's do y that's down from an april high it's becoming much more about oil, the tight supply. and that seems to be the main kind of relentless bid in this bid. take a look at caterpillar and deere compared to the equal-weighted industrial sector they're part of the sector they've obviously outperformed on a year-to-date basis. and interestingly, the slow-down fears that have capture the market have mostly been about consumer cyclicals, banks, not

as much about industrials. >> i never say that, but i do when it's deserved good stuff, these are the times that test men's souls across the board. markets and everything else around the world did you ever think we'd be more worried about what's happening internally in this company what's going to happen, can you tell snee. me? >> no. i can't, but at any moment in time you always have people who feel like things have never been as bad or complicated as they are at this moment sometimes it was true and sometimes it just felt that way. >> is this just me, why do they call it common sense when it isn't common at all. >> well, it is any rational or reasonable

person -- >> should be uncommon sense. mike, it should be uncommon. >>'s j >> it's just the loud mouths on either side who don't have it. >> i resemble that remark. >> okay, shirking violet >> that's a new one. a really good one. a shirking violet >> not a shrinking >> we've got breaking news right now concerning ambition in the video game market. i want to get straight over to steve. steve, good morning. >> hey, good morning, andrew microsoft vision for this netflix of gaming is taking shape today. the company announcing its x box streaming service is coming to samsung tvs at the end of the month. it will be the first tv device to carry it. it's kind of new you pay $15 a month, and on your smart tv just like would you

watch netflix or any other app, would you connect the game controller over bluetooth and stream from a library of hundreds of x box games right over your tv that means you don't have to buy an x box console or expensive pc and this plays into the vision where x box games are available anywhere with a connected device that has a screen. and pretty much every samsung tv is a smart tv. this plays into the act vision d deal this is a very new kind of thing, and microsoft's plans are getting a little hung up right now, because apple blocks these kinds of apps on its florms. they argue that we need to rate

every game individually, and this is a really big barrier to get their x box game pass service out to more people, but it has allowed on android devices. you can speak to the technology issue. are the games that are going to be available on streaming on this streaming service of the same caliber quality in terms of that experience? >> yeah. exactly. they're literally the same x box games that you would play on your $500 x box console, they're just streaming straight to your tv i saw a headline on "wired", questioning whether microsoft even needs to make x boxes anymore because of the service, all powered by the cloud service. they can do all that computing in the cloud and stream it to your device. >> we talk about netflix trying to get into the gaming they're doing it in the mobile

gaming do you think that shifts the dynamic for other streamers to now say i need to be doing gaming >> here's the thing. it's really hard to do google tried doing their before athis before, and they really just gave up on it microsoft has the cloud technology and the x box ecosystem around it. amazon's kind of playing around with it with middling success, but this is a very unique thing that only microsoft can offer. >> hey, steve, when you said that thayeere was going to be breaking news, my thought was act vision blizzard. where do we stand with that deal >> this is going to be another year waiting for this thing to close. assuming it does close, what microsoft has said earlier in their briefings on this is look, we can put some of the act

vision games on the service. you pay the $15 a month instead of playing the act vision games. they can add that extra value because they already own that studio >> steve, thank you. >> thanks, becky when we come back, mario gabelli will join us to talk about inflation and its market impact all of this ahead of tomorrow's key cpi number and is the rise of esg investing leading to these higher prices at the pump? we're going to dig into that thorny question when "squawk box" returns ful word. neighborhoods "open". businesses "open". fields "open". who doesn't love "open"? offices. homes. stages. possibilities. your world. open. and you can help keep it that way. ♪♪

another crazy day? of course—you're k a cio in 2022.. but you're ready. because you've got the next generation in global secure networking from comcast business. with fully integrated security solutions all in one place. so you're covered. on-premise and in the cloud. you can run things the way you want —your team, ours or a mix of both. with the nation's largest ip network. from the most innovative company. bring on today with comcast business. powering possibilities.™

the national average price per gallon inching closer to $5. we're sitting at $4.97 today the war in ukraine, the pandemic, but what about a growing focus on environmental, social corporate governance investing, just generally, the green pressure those commonly known as esg. for more, let's bring in jonathan bailey. and vivek ramaswamy.

and the author of "woke inc. inside corporate america's social justice scam. this time he's going to tell us what he really thinks, vivek thanks to both of you for joining us let's start with the ground rules, jonathan. what is the point of investing, of esg investing is it superior returns or is it to be able to join the global community of the v virtuous the people who care about their actions and leaving the world a better place >> it's about creating excellent companies that focus on operational efficiency, empowering their workers, protecting the way that think operate from an environmental perspective so they're efficient in the use of inputs like water and thinking about risks down the line that might come from

climate change and changing regu regulatory expectations. we believe esg can help you create strong returns. there are a lot of swinvestors h have other impacts they are looking at environmental, social and government governmental associations. >> is the jury in on whether you can succeed in superior returns from doing this? does anyone have numbers that say one thing or the other that you actually, you outperform or underperform what you do doing something based on excellence and corporate excellence that has nothing to do with these other thing, which probably come from running a great company. all those other things fall in

line without you having to say it up front. >> that's exactly right, joe and i think that look, both sides can cherry pick their data the data are pretty clear that esg has underperformed other sectors like the u.s. energy sector one of my issues is the coordination amongst different firms in the asset management. take this climate action 100 plus network it boasts that it represents over 50% of global assets under management and they coordinate to tell firms to cut emissions part of cutting emissions is cutting production the problem is that when you have over 50% market share representing entities get together, decide to coordinate on an action like cutting production and then prices spike at the pump as a result, we have a woord for that in this country, it's called an anti-trust violation and the funny part about this, not a lot of people talk about this is how this esg movement

applies its standards so selectively in the united states and western europe, without saying a peep in china and the best example of this i thought was blackrock and state street and vanguard voting in new directors at exxon after they took their seats at exxon, they cut targets by over 20% from prior forecasts but the people at the front of the line are none other than petro china. and if you want the cherry on top, you look at who are the largest shareholders of petro china is, it's none other than br blackrock. so part of this is a deep-seeded conflict of interest esg for thee, china for me it's bad for the environment, because u.s. natural gas for example is 40% cleaner for the environment than russian natural gas, because we don't have methane leakage over here.

i think this meth 0d fails on every prong, from prices to investment >> jonathan, i want to think a bit objectively. people laugh when i say that but when i think about it objectively, you don't want government picking winners and losers in industry that neff works. they're horrible at it but what you really have here are high-minded managers doing the same thing, picking wind and solar begins fossil fuels. take that to, extend it to other things i know it's the free market. you have to market these funds people have to say yes, i want it, i want to be there but it's not corporatism in that way, but why would you think you'd be any more skilled at picking the eventual winners in any industries than letting the market decide itself it just seems like it's a fool's errand to start with >> supermarket a collection of different opinions

vivek, you know, has an opinion about what he thinks is going to happen in energy markets, we may have a different opinion, that's how the market ends one a price. and those choices can consider various different scenarios around what might happen from an energy transition perspective. if you look at the iea scenario for net zero, that sees about a 6% decline for natural gas demand through 2030. they could be wrong. but that's a scenario that says maybe we don't need to ramp up production over the next decade. clearly over the next three to five years, there is going to be a need in the u.s. where we have high-quality operators for natural gas to play an important part in displacing russian exports. but that department happens every day. and what i think is really important is that we don't just sort of fight against a akn acry

for the sake of it we do it as an individual investor we're not collaborating with a whole group of others. you listen to the current administration think are calling on wall street to start asking companies to return capital to shareholders if that doesn't strike you as socialism i don't know what is we are on the side of what is good corporate business. and we've been burned in the past bity the oil and gas sector deploying into sectors that didn't earn a strong return. our role is to protect our investors and clients and to make sure that when we choose to invest in a company we think there's a strong generating cash flow >> during the pandemic, obviously, a lot of energy producers said wow, we're spending all this money, and

we're not going to get anything back queer we're going to cut back and that is a large factor we see it in other commodities how much of the $5 gasoline do you think is esg-related can you quantify it? >> i think it's a significant part of the high gas prices can be explained by the effect of the esg movement and the irony, joe is what you just gave. it's guilty of short-termism everyone would know that yes, the pandemic lasted a couple years, but underinvestment in oil and gas production is going to come back and bite at some point in time. 2 today it's come back to bite today there is no doubt that the companies that would have made those investments for the long run would be benefitting from being able to meet global energy

demands at time when there's a high demand and low supply could anyone have really predicted that russia was definitively going to invade ukraine this year? i'm not saying they could. i joke around that in 2022 esg should stand for "export soviet gas", because that's effectively the impact it's had on global markets. i think it was short term on esg's part >> we'll see you guys in the future >> rather than in the past >> priedictions about the future very, very difficult jonathan, vivek, thank you coming up, interviews with market veteran, mario gabelli and then later this afternoon, in washington, where i'm at, i will be speaking with treasury

secretary janet yellen and also howard schultz in his first interview since becoming interim ceo of star buck and senator chris murphy as well we'll bring you highlights on squawk tomorrow morning. we're coming right back after this before investing consider the fund's investment objectives, risks, charges and expenses. go to flexshares.com for a prospectus containing this information. read it carefully.

in three seconds, janice will win a speedboat. bingo! i'm moving to the lake... gotta sell the house.

ooh! that's a lot of work. ooh! don't worry. skip the hassles and sell directly to opendoor. bingo. get your competitive offer at opendoor.com still to come, breaking economic data, a new read on joblesclmss ai coming next "squawk box" will be right back.

welcome back to "squawk

box. rick santelli here with breaking news initial jobless claims, 225,000. about 25,000 more than we expected and 27,000 more than the slightly revised in the rear view mirror originally released at 200,000 here's what's fascinating. in order to find a number higher than 229,000 you have to go all the way back to january 14 when it was 240,000 continuing claims, 1,306,000 which actually equals last week, because last week was revised from 1,309, 000.

the interest rates didn't do anything surprising, the market is the boss, and the boss is demanding action and the next meeting they're going to give action, so we want to pay close attention to that and next week we have our own meeting to look for the markets to do their normal pre-fed meeting dance as we move to another 50-basis point hike most likely as we come in sunday night, look for interest rates to start creeping up, maybe taking out that 320 interday high post covid. joe, back to you >> all right, rick, thanks we have result of cnbc's exclusive cfo survey looking at issues like inflation, the fed, the war in ukraine and all the effects these things have on the markets. frank colin joins us with more hey, frank >> good morning to you

80% of cfos say the ten-year yield will be higher inflation clearly on the minds of these corporate decision-makers. they say inflation is the top risk their business is facing with fed policy and splayupply i disruptions. those are issues that are seen to have some type of connection. now remember, this was taken between may 12 and june 6. on may 11, cpi was nearly the highest level in 40 year, and russia was preparing for a long conflict in ukraine. and on may 10, fed president rafael bostic said the fed was anticipating a soft landing. those factors and others led 68%

of cfos to forecast a recession. clearly concerns about the strength of the aeconomy in the long term. 77% of cfos expect the dow will fall below 30,000 in the foreseeable future, a 9% fall from the levels we're seeing today, and only 13% are optimistic that the dow reaches a new record high of 40,000. >> we know cfos, i like them we have the council and everything i'm trying to figure out what they might be better at, the underlying economy t they've got things they can see. stock market performance i'm not so sure. you know, a lot of times consensus is always wrong. which consensus do you that i cfos could be right on maybe the economy. but i certainly wouldn't listen to them about stocks

>> one consensus, one consensus they have that doesn't require any forecasting is cyber security spending. 68% say cyber security spending is elevated, and more than half of them feel better protected. that's one area they have better visibility >> some of it is self-fulfilling and they can affect their consensus on how they manage okay, frank. thanks, thanks for the numbers we'll see you. let's bring in a big guest who does have decades of experience navigating inflation and the ups and downs of investing through all of it. mario ga mario gabelli is with us i know you've been watching the fed's reaction very closely. the last time we talked to you was a little over a month ago.

what do you think now with a month's worth of data. >> the fed's already doing two thing, one, raising rates to catch up and to whip inflation and you see at the pump, the food costs, and the second part is the rolloff the rolloff is 47.5 trillion, out of the $9 trillion a billion per month going to 90. it's 17.5 against mortgage-backed securities going to 35 in august. and treasuries are at 30 going to 60. so they're doing what they're doing at a glacial speed, but from a corporate point of view, becky, what do i look at, i look at market share, i look at industry trends, but i also look at nominal revenues. that's where my revenues are and you hear it every day. the second thing we're looking at is sg&a not rising as fast as nominal revenues

in addition to that, in addition to that, you'll see the reports of companies that look at the balance sheet. inventories have gone up in part because while units have not gone up, the amount of dollars in inventory have gone up. and the question is, is that too much you have stockpiled lumber, for example, at $1200. it's now 600 so you're going to take some writeoffs. but the market tends to ignore that as far as the economy sp conc is concerned, yes, i've gone through cycles when it's good, what multiples do we pay? and with the higher embedded interest rates in the future, you're going to pay lower ebita. >> let's talk about the multiple right now. we have seen multiple compression that's come down from 21 or 22 down to 17 or 18 times earnings but there is a big debate about whether and how much the

earnings estimates are going to have to come down, in which case it hasn't been as much multiple compression as they think. where do you come down on that debate >> becky, when i started multiples in the '60s were six, seven times. by having leading, lagging then when i started the firm in 1977, continued to look at stocks in that fashion, multiples were three to five times even to capex. a year ago, were you looking at bitcoin, nfts, robinhood, a multiple of revenues now you're looking at ebita versus capex it's not only a multiple of s&p esh earning, but i'm looking at stock specifics. look at the amount of capex put in bit majors and the

independents over the last decade i tweeted that and you basically can see how capex declined why? obvious. everybody was saying they're going to cut off your financing, you're too lefrngsed the price of oil chanced now i find companies that are tiny, the stock sales are $31. we own it for client, and they got $10 in cash, and they're building out slowly. then you look at some of the companies like the faang, energy, and cal point, which is smaller enp producers. you look at it and say will oil stay at a certain price and what can i do, can we have the equivalent of the production defense act to help oil. so we want to cut down, i'm not as worried about high costs at the pump there are companies that i talk to that are giving stipends to their teammate, employees for gasoline payments. but on the other side of the coin, in the 1970s, since you

asked my history, we had to wait in line for availability >> mario, you mentioned it again. so we'd be remiss if we didn't talk about it. that doesn't mean win. is that from the '70s? that was jerry ford, right? i think that was gerry ford that came up with that brilliant idea like a saying, but then you know what the next guy did. remember what the -- >> you cannot have -- >> wage-price controls jimmy carter >> you're extremely correct on that price controls do not work because they cause the misallocation of resources corporate ceos, you know, you worry about a proxy fight. you worry about other things and some that don't know anything say oh, they're going to pay dividends and stock buyback. look at the true maauma that co

went through you're right, joe. >> where did you get it? is that vintage, or is that new? >> no, this is a blow up of what was around as a pin. we didn't want to buy the pins for 25 corrects. we created our own >> that was ford, as i recall. >> that's a good memory check. so, within the framework of looking at inflation, interest rates, looking at invasion, energy independence, things like that, what do we like? the ag ecosystem is a ben fish riff ry of these dynamics i was just at a meeting with deere. they're go, and it's going to be up in the next year or two you look at case. and then you look at how do we help the

public consumer of food on a global basis and that's a challenge the sunflower seeds are very important from the ukraine and from ukraine and russia. wheat, obviously is what's talked about think about sunflower seeds and what they're used for, sunflowers we look at that ecosystem and then look at aerospace and the feds if you go back to the 1930s, there was something in germany, the french created a marginal line our minute man defense system is the same way i it's stale meanwhile,other c other companis wanted to emergency. this company with 85 million share sells at 42. they're going to pay $51 for the company. now you've got cash, stocks and big earnings power we look at that.

then we look at companies that are tech strong. 230 million shares and they can earn $4.50 next year and they sell helicopters. and we look at ag, defense, the laser and try to figure out how do they function independent of that, and then you try to go buy a used car joe, if you want to go buy a used car for your family, you're going to pay a significant amount if i'm working in the inner city, and very toi have to commo work i can't afford a new used car. i repair it as best as i can >> a new used car. >> new to you. >> 270 million cars on the road. the average age has gone up to 12 1/2 years >> a new used car is like jumbo

shrimp >> i agree you're 100% correct. but try to buy one independent of that, joe, imagine if you want to buy a ne car for $24,000. >> good luck >> they're not making them >> you work in the inner city of newark or the south bronx or anywhere in the world, in the united states, if you can't buy a tess lla, they're going to gi $15,000 credits to people who want to buy that >> and commodities, not just oil and gas, but ag commodities, too, are on a super speak for many years to come we will see you soon, mario, thanks for your time >> atlanta braves. >> yeah, they're hot coming up, jim cramer's first take on the trading day ahead. and then savita's going to join

us live. we're coming back right after this to adapt in the changing world, you could hire a professor of theoretical mathematics. we all know this equation, right? he'd crunched numbers day and night. that's it. to maximize profitability. morning. i have quarterly numbers that are beautiful. and forecast revenue from every corner of your organization. is that important? or you could use workday. the finance hr and planning system that helps cfos make better decisions faster. for a solve problems like a genius world. workday. for a changing world.

flexshares etfs are built with advanced modeling. to fill portfolio gaps and target specific goals. strengthening client confidence in you. before investing consider the fund's investment objectives, risks, charges and expenses. go to flexshares.com for a prospectus containing this information. read it carefully. only at vanguard you're more than just an investor you're an owner. that means that your priorities are ours too. our interactive tools and advice

can help you build a future for the ones you love. that's the value of ownership. we turn to the new york stock exchange jim, in the land of the recall of certain individuals were you out thayer for that that's interesting you've got some other stuff going on, more, more in our

genre. more in what we like to watch >> it's very interesting >> amazing >> you gntdidn't go out for that look, you know, one of the things that i just keep seeing, it's endless, rates, rates, rates. and the rates going higher as numbers and price targets are cut produces exactly what we're looking at, and i wish i could be more positive, but i just have not been getting anything that i think i would describe as being positive so far. >> you've had a cross section of everything, tech, tech, but everything but cyber, is that the one thing -- >> that's the only thing that's good but that's obviously a defensive play i mean, you've got great numbers from palo alto and cloud strike,

really great numbers, and i just think at a certain point you say, well, is that all you have? and just people who fight bad guys and the answer is yeah they're still hiring everybody else is like a hiring freeze or people are firing. they're beginning to fire people out here engineers, a lot feel the talent is overpriced. they'd rather hire people in atlanta. that was one of the cities that's been highlighted endlessly. austin, another city that's been highlighted. ohio these are places where you figure you can get a little bit cheaper talent >> tech was dominant for a decade i wonder if that means it's not dominant for a decade or whether that could be. and i just noticed, you can see who wrote this big piece in "the journal," our cnbc contributor, becky. so it doesn't mean it's another ten years of malaise, jim, does

it >> no. no, i don't think so but you get a company like okta, and that's a really hot area, to try to figure out who breaks into someone and then very quickly extorts and says, look, we'll close your product line, we'll release information, and that's just a company that's going to have a good next quarter. but otherwise i think you have ship makers that are just telling you to cut numbers it is a little depressing. >> all right, jim. thank you. appreciate it. enjoy your remaining time out there. we'll see you in a couple minutes at 9:00. "squawk box" will be right back. , she'll answer your calls and assist your clients. you can't be in two places at once, let posh answer. posh virtual receptionists.

beep. beep.

what up, nick? again, charles? i need to add to my cart for father's day. i think that's a different type of cart. grab those shoes and get in. coolers? rack 'em and stack 'em. drivers. time to go clubbin'. dad joke? it's father's day.

welcome back to "squawk box. the european central bank signaling rate hikes looking ahead to critical cpi data tomorrow, i think the big question is who what do you think is going to happen tomorrow and depending on what you think is going to happen tomorrow, how do you play that today >> look, i think we're in an

environment where inflation is surprising to the upside whether or not tomorrow's print surprises to the upside, we need to brace ourselves for a very different regime going forward think about it, we're in an environment where fed liquidity and government liquidity is on pause if not tightening. we're seeing central banks across the globe basically reverse this liquidity that they've given us for the last ten years. and i think that leadership is going to look very different from what we've seen over the last decade or so. i think what's really interesting right now is we're seeing the same types of kind of entrenched growth biases amongst investors that we saw coming out of the tech bubble it's really hard for investors to give up on the sector that made them lots of money in the last market cycle, so i think the pain trade is still down in tech and up in value, energy, financials, sectors nobody

really owns at this point. andrew, what's also interesting is in 2008 we saw is same thing with financials. investors were overweight in financials three or four years until 2011, 2012, 2013 when they gave up on financials. so i think it's one of those environments where we're all kind of waiting for tech to recover from the ashes, and it may take a lot longer. >> any chance it happens sooner, meaning that things are not as bad as we think, or are you -- what, cardi b over the weekend tweeted out when do y'all think they're going to announce we're going into a recession are you with cardi b and jamie dimon or others? >> yes look, i think we could very well head into a recession in the next 18 months our economists have assigned a higher probability but i don't know if you want to be in tech stocks in the next recession. i think the next recession will be driven by hyperinflation or stagflation. rates are a lot higher today

than they were in, you know, the last few years so i think we're going to be in an environment where you don't necessarily want to buy tech and long-duration companies in the next recession they might not be as defensive as we think. we're seeing that cyclicality show up for a lot of these so-called secular growth stocks. we've seen demand pull forward for a couple of years. so i think that tech might not act the way tech did in the last recession going forward. i think financials might actually act a lot better in the next recession this is a sector that's well capitalized, you know, balance sheets are pristine, these haven't really been the companies that have been lending so they are less economically sensitive than other areas of the market i think it's going to be a different type of recession than what we saw in '08-09. >> you think financials are the safe place or do you think cash is a safe place? we talked about cash is trash,

but others say hold on to your cash because there may be an opportunity, you may need it or want it. >> i think that's absolutely right. cash is king in this type of market the fed is hiking and we're moving from zero to three in returns on cash. that's a monstrous move. meanwhile, financials, energy, the sectors that are producing cash flow are the most, you know, reviled sectors in the s&p 500. so we're at a really interesting point in terms of ownership being convergent in hypergrowth long duration, but the winners might be in the cash-flow deepers that haven't caught a bid for many years >> is a vitae, always great to see you. get your idea on where things are headed a final check on the markets before the market is set to open we'll flip the screen around and you can see we are low toer this morning. we were in the green before, dow off about 65 points now, the s&p 500 off about 13 points, the

nasdaq off 16 points the 10-year, as well, that note sitting at guys, that does it for us. >> good luck today. >> thank you join us tomorrow "squawk on the street" begins right now. >> god thursday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber futures are weak after wednesday's sell-off as yields in the u.s. and europe tick higher on the back of ecb. inflation is broadening out. jobless claims the highest since january in the states. our roadmap begins with the inflation jitters and recession risks with prices at the pump continuing to rise average prices jumping 28 cents a gallon in just the last week >> shares of alibaba giving up gains,