nightmare. it is friday, june 24th, 2022. "squawk box" begins right now. 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 carry-onjo kernen and andrew ross sorkin. you will see there are green arrows on what has been a good week the best week in a while you are looking at the dow futures indicated up 232 points. s&p futures up 31. nasdaq up 122. maybe a bigger story for the markets has been what happened with the treasury market yields have come down significantly. 10-year treasury is now 3.085%

this comes after a couple of weeks ago touching 3.4%. these are significant moves that impact a lot of things from the credit card rates to mortgage rates. breaking news. we have new details on energy secretary jennifer granholm's meeting yesterday. according to an oil executive in the room and accounts from the industry and administration after the meeting which was productive the energy secretary was someone looking for ideas to work with the industry to offer relief to soaring energy prices. there are not solutions in the short-term ones that do exist are not ones that the biden administration would agree to the winter grade gasoline sold in the summer. that is 2% more supply than right now. that would be equal to adding another refinery in the country. however, the winter blend uses

more butane that evaporate more quickly in the summer months that is a concern to the environmentalists. it could impact the ozone which is an issue for the administration they could suspend the jones act of 1920. requiring all vessels to be u.s. flagged and u.s. crew. the trouble is, those ships are hard to find and cost four times as much. to take something from the port of houston to the port of new york to move things around more easily they are in favor of the jones act. that would be a tough sell with the administration the decisions will have to be made by president biden. he wasn't at the meeting yesterday that he summoned the nation's ceos to he did find time for the

wind industry. if that tells you where things are going, good constructive conversation yesterday, but the energy secretary is not deciding we will see what happens next. >> we know who the decider is. you remember who told us that? >> if you did the -- if i changed the flag issue on the vessels, how meaningful is that? are those costs that are genuinely passed along to the consumer >> they are. it would ease issues with getting things around the country. refinery shutdowns have been a problem in the northeast where there was a refinery in philadelphia that was taken offline. it would be easy to get things here it is not a huge difference. >> 3 cents, 5 cents, 10 cents a gallon >> i don't know. the other idea is make sure they are prepared for hurricane in hurricane season, you see a shutdown for the refineries

before the hurricane gets there for safety reasons they want to get back up and running and have the clearances. all of these issues take time. the jones act had given clearance in the past to say yes, we will do those things it takes time to get there they are making sure these are not things that help in the immediate future, but help from things getting worse with a hurricane or shutdown situation. just flexibility >> those are things they put in place? >> the winter grade gas would be done right now it would equal another refinery in the country the reason the clean air emissions were put in place. >> is that something that can happen overnight >> that wiould happen pretty quickly. there is a reason that act is put in place to begin with you have environmentalists worried with smog. >> commodities are rolling over. some of them this is like sticking out like a

sore thumb economies are starting to rollover here and in europe. brian sullivan has been talking about this in his segment. it is a cold winter in europe and they start rationing they choose heat or aluminum i think i'm once again thinking that the fed will not have to go as far as we think >> that's why the treasury market is reacting >> that's what i mean. stock market is good again yesterday? i don't know i'm looking for some way to get out of the mess without a really hard landing what worries me is economies slow and energy prices stay high we're not -- even the other commodities rolling over. >> oil looks better at 105 versus 120 >> still tough brian. >> let's get to brian. >> natural gas is expensive

here you see what it is in europe brian will talk about it >> let's go to brian sullivan who is digging into that start brian? >> i got a lot to adhd here it doesn't get attention in the media. more people die of cold than they die of heat heating homes in the winter. cold is a killer more than hot let's go back to becky's point here first off, this meeting and everything i heard echos what becky said i will add one thing which is some of the executives, by the way, also at least told me privately, they were worried about safety usuissues 94% capacity and there has been staffing issues. you want to crank up to 100% running full-out and full tilt 24/7 swap to bio-fuels?

there are safety concerns. we know when a refinery has something go wrong, it tends to go wrong the philly fire that becky mentioned. it was very close to having to evacuate hundreds of thousands of people in south philadelphia because of what happened i don't know -- i know becky plays wordle my guess is andrew does. i don't know about joe yesterday, the administration played a little press release wordle i hope we havethe graphic. kill the prompter. they put out a press release it was positive. it was a line that caught my eye. it said, record u.s. oil production under the biden administration that's a clip. at a time when the u.s. achieving record oil production under the biden administration i know we're not anywhere near record oil production. in fact, that was 12.9 million

barrels a day back in late 2019. we're at 11.5 million. i fired off an email to the department of energy trying to get clarification and haven't heard back i realize, joe, this is political wordle. the press secretary said the same thing on the podium record oil production under the biden administration that is true under the biden administration this is record oil production. man, i have to admit, i'm in pressed. whoever wrote that that way, i salute you because that word play was so smart. it makes it sound like 99% -- >> cutting the deficit in a record way because we are not spending trillions one thing after another. i was shocked. did you see our friend harold

ford he is on another network now he still toes the democrat line. over there, that's why he is there at fox to be sort of a palatable foil for the other maniacs that are there. even harold says a biden retreat to lower gas prices. war on fossil fuels. no democrats won't admit there is anything to retreat on. give harold credit for that. you can't get leases you might get permits, but you can't get leases slow off the refiners. he mentioned ten things that are different. >> the st. croix refinery that is not being reopened and getting whacked. you may agree with the moves there are things being done. not you, the rhetorical all --

the billions of "squawk box" viewers around the world in nome, lalaska did you see the segment? russian oil exports are at the same level they were pre-war russian production is pre-war levels energy intelligent had a record that europe buying of russian oil is up from last month. so whatever you think of the sanctions, whatever you think of this, vladimir putin, is very likely making more money now because prices have gone up with the discount they are selling than he was before the war and before the sanctions indian buying is 650% higher than a year ago. they created a really cozy

relationship between probably the world's most populous country now, india and russia. >> i have a quiz what is the best performing currency in the world for 2022 anybody know >> russian ruble >> right it soared again. it was coming from awful levels. up 40% for the year. that is because of the very things brian was talking about they have been able to stabilize the economy by selling oil and natural gas despite the efforts we made to hem that in >> i'mat the lowest weight at my current diet, brian, which i'm proud of >> that's the political wordle. >> under my current -- that is unbelievable wordle i don't know what the heck it is double speak it is really good.

record production since i've been president >> you get people on twitter saying it is record production not record production. >> record profits. >> again, let me go. you have a show to do. it is not record properfits >> under the biden administration it is same thing under the biden administration >> which administration? the record profits, joe, most of them came in the third and fourth quarter of 2011 when now president biden was vice president. >> that's not the biden administration that's the obama administration. >> you know. he was in office >> now you are playing wordle. >> those were record quarters. >> i'm shocked there is duplicitousness.

>> in washington >> they all do it. >> equally on the last one in. you have been fair >> i don't remember it ever happening during the trump administration which downplayed anything that ever happened. >> you talked about the trump hotel in washington. i haven't heard laptop or ukraine mention a single time. you give back the pulitzer yet coming up, what fedex shares about the increase in quarter. and the flight attendants union president weighs in on the latest you are watching "squawk box" on cnbc >> announcer: this cnbc program is sponsored by truist securities experience, expertise, execution.

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expectations. shares of sarepta put the decline al trial on hold after serious adverse events i'm trying to pronounce sarepta. every syllable the same >> sarepta >> sarepta >> drugs like sarepta. >> i could be wrong. >> then i see why i'm reading it merck moving forward with a deal with seagen. the pair is set to meet in coming days. the report says it is unclear if

merck submitted an off foer fore bio-tech company let's talk bank stress test. biggest banks passing the fed reserve economic jodownturn all have enough capital to handle surging employment and collapse in real estate and drop in stocks. banks are now in the clear to announce dividends and buybacks starting on monday we'll see if they pursue all of them are trying. when we come back, more on "squawk. intel to congress and they want to fund the chip sector. and that fund in ohio may be off. coming up next week, live

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time for the executive edge. intel with a chip factory build outside columbus, ohio could be scaled back or delayed that decision is based on what congress does with the chip act.

it was designed to inject $50 billion into the sector. we talked so much about it and it has been stalled as lawmakers work to reconcile the bills in the house and senate the spokesperson telling cnbc intel is still committed to the in inve investment it is uncertain if the chips act is not passed by congress. the issue that everybody agrees on and washington. it's washington. >> long-term thinking. that is difficult. everybody wants a short-term solution >> it is silly they can't put the bills together >> to have more investment in the united states. we have seen what happens when you don't have manufacturing in the company. this is an easy go-to. it is surprising to see this get bogged down. i have a segue from that to this my cousin katie graduated from

the ohio state university. you know who the speaker was >> pat >> pat gelsinger the ceo of intel we want to talk more about graduation season before break a shoutout to grads with big graduations this week. natalie graduated this week. graduating from high school. i can't believe it already happened she will go to san diego state university this week joe, this was a big year for you guys blake graduating from upenn. and matthew, matt's son is headed off to the university of minnesota. shoutout to the squawk graduates. >> it is cool to go to golden gopher land. bring some warm clothes.

>> he's on the dance team. he has a scholarship >> oh, really? >> yeah. >> pretty great sports school. up next -- >> kevin mchale. >> yes sara nelson will talk about the travel nightmare that existed at the airports throughout the month of june, we are celebrating pride month. here is former professional soccer player thomas beattie >> i came out two years ago and it was something i wanted to do and dpidn't need to do i wanted to be visible i wanted the younger generation to look up and resonate with that example it was something i never had i looked around me and never saw

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good morning welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square. pretty good session yesterday. surprisingly after what could have been some weakness we saw early. it was up and down as the day progressed ended closing higher 118 points on the nasdaq i saw an article saying don't trust the s&p move until we get above 3,800. 3,795. do you trust it above 3,800? it will get there today, theoretically. >> you tell me not to trust?

>> i don't know if we got back above 4,000, does that mean it is the respite for summer? >> see where we are on the fall. maybe the inflation pieces layout >> i want those to be the lows >> don't we all. why wouldn't we? >> i don't know. maybe we need to flush things out. make a lasting bottom. i don't know united let's talk about it. the latest aeriirline to announe cancellations. cutting 50 daily flights from newark starting july 31st. the reason is capacity and airport construction and air traffic control. not staffing for more, let's welcome in sara nelson representing the flight attendants at 20 airlines. half of the industry i want to thank you for joining us look, this united thing may be

idiosyncratic to what is happening in new york. there is a broader thing to talk about, sara. we talked about it add na nausem you advocated for the bailout program. you said if we didn't do it, everybody would be terrible and it was a necessary evil to go down thispath. we went down this path here we are and every day you hear about a remarkable number of cancellations that are impacting people's lives daily lives. customers' lives taxpayers lives. no compensation or recompense. nothing. i want to understand what it is. that is not right. >> first, i would not call this workers' package a necessary evil it is celebrated as the best

relief program in place. it kept us in our jobs and paying into the tax system that all came back to the american people. the airlines would have collapsed and gone into bankruptcy and without it in a worse position what is going on and i have a lot of empathy for the people on the front lines and all of the travelers. i love to see the celebration of the graduations. i was working hard to get someone from chicago to the east coast to make a graduation today. we just barely made it after two days of trying i'm glad about that. you know, this is a perfect storm, andrew. we have a lot of things going on the fact that the airlines had cut back to minimums before coronavirus. all of the staffing were already at minimum levels before we went into covid that doesn't give us a lot of room to make changes when we get to that.

there were staffing cuts across the board. the open rrational support for workers on the front lines and passengers to get through when the flight is canceled is not staffed at the same levels before this is an area where the airlines could really do something about this you brought up the issue of newark you know, in the whole northeastern kcorridor, it is a different story it has an impact when you can't get planes out of there and people to connections. the faa is not enforcing the slot requirements or rulings they need to get back to doing that >> what is supposed to happen her? from a passenger perspective, from the customer perspective and taxpayer perspective, it doesn't look like it is working. it looks like it is a broken system is failing the american people failing them >> it did work, andrew it is summer, too.

let's remember a lot of things are going on here. american aerirlines, i want to recognize they saw we have two systems here we have the main line flying and region al flying. we have issue of pilots hired into the main line operations, american, delta, alaska, southwest and united they are working on training them it takes longer to train pilots. there were planes sitting on the ground and pilots could not retain qualifications as the big planes were sitting on the ground we also have the problem of attracting people to the job the regional and beater airlines -- >> sara, it sounds like you are saying woe is me i can't really identify. what would you do about this how would you hold management at these companies to account

>> i want to tell you good news. american airlines recognized this and worked with us on incentive program over the summer and brought the pay up to attract people to the jobs at the regional flying. other airlines can do that as well it is really important we need to address what is happening right now and cutting back capacity so they are not having people come to the airport and miss flights and reaccommodating on other flights and planning so people are not stranded at airports it is a really important move right now. the airlines need to do that more they need to look at that capacity and what they can handle and not over-promise here we also need operational support. there is a lot of that can be done at the airlines right now. >> what do you say about the idea -- luooks, we have an inflationary economy the cost of the ticket has gone up

service has gone down. that's the problem here. i'm trying to understand and i know you are working on behalf of the flight attendants, but i also think flight attendants are working on behalf of the american people sitting on the planes frustrated out of their minds. >> the flight attendants are frustrated, too, andrew. when we can't get through to get reassignment -- if we can't get reassignment, we are missing a flight we could be getting to that flight to staff that and get people on their way. >> ultimately, this doesn't work unless the customer is satisfied and happy. i have to imagine you want that more than anything as much as working for the flight attendants >> that's exactly right. we are the passengers' biggest advocate their travel space is our work space. >> what are you doing to add have k advocate us? the airlines are gouging and

cancelling and missing vacations and opportunities to spend time with families. >> let's be clear. the airline prices were depressed and airlines were losing billions with the payroll support. that was to keep the infrastructure in place. now the airline prices are going up let's compare that over the last 40 years this is not -- these are not huge airline prices this summer. these are compared with pandemic rates. not the rates compared to 2019 levels what i would say is that we are pressing the airlines to fix the operational issues we are also saying that this is a problem also with atc and the government doing extensions rather than long-term funding so we can upgrade the system so we can hire people into the jobs. that is part of the issue. it is not always the airlines fault. i want people to hear that for

the flight attendants and other workers trying to make this work the other thing that happened, andrew, the contractors did not get funding in time because it was held up at treasury and they did let go a lot of people the people who pushed the wheelchairs and concession, that relates to the airport stream. it is really tough for people on the frontlines we in many cases cannot get the hotels >> sara, the last time i was badgering you about the masks in april. >> good one. good one >> in hindsight, now, you see it is okay. people are on a plane. >> people are getting sick and they did not get sick before this is part of the perfect storm. the mask mandate went away and more crew got sick who hadn't gotten sick during covid and working through covid. this contributes, joe.

>> you still wish there was a mask mandate now you wish everyone was wearing? >> what i'm telling you is we are having consequences of that. a consequence to every action and what we're seeing is some people are getting sick. the good news is they are not getting sick for the length of time before the vaccine. >> or serious or hospitalization. >> absolutely. absolutely. >> endemic china wishes they had the immunity we now have >> that's true, joe. when people are getting sick, they are not able to come to work it is not for the length of time it used to be, but when there is no give in the operation and staffing cuts at minimum levels to begin with, it is a problem >> can we have a point of fact so we're on the same page. you said prices are not up historically high level. federal reserve of st. louis track since 1989

highest they have ever been. shot up 25% in april >> do you note for inflation >> adjusted for inflation. >> we need to talk about the same set of facts. i'm not sure what you are looking at there as joe was saying, is that adjusted for inflation i don't believe so i think this is shocking because people were able to fly around for $99 fees during pandemic and now the prices are more matching to demand. >> what happens when a passenger gets canceled? should there be different regulations in place to help passengers i was in europe. they have all sorts of rules in place. it costs a lot of money to cancel a plane in europe in a way it does not here. >> i think lawmakers could look at the provisions in europe and look at flying some of those i think we also need to

recognize that what is in europe is provisions of rest for the crew we need 10 hours rest. as people get fatigued, that leads them to getting sycaick me we need to see what is happening here i say this for the frontline workers taking thesfrustration. what is happening is not the airlines fault and the workers are taking the brunt of that it is a combination of not investing in the infrastructure of the country and the fact we have driven to reduce costs. we took the ban on stock buybacks for the airlines. that is lifted on september 30th we need to reinvest in the airlines and infrastructure they have to respond. >> are you against airlines buying back stock? >> i am. we need to be reinvesting in the infrastructure that obviously you were calling out very rightly which is not there to

support the demand from the american public. they should reinvest in that infrastructure and operational support and workers who can do the jobs in order to meet the demand of the american public. >> sara nelson thank you for engaging with not always easy questions of what is going at airports. thanks so much >> i appreciate it, andrew thank you. >> i still think it is a good deal compared to where it was in the '70s i was around you could fly $700 back in the '70s and '80s. it is the same price now it hasn't kept up with inflation. if they are not making money, maybe they are not charging enough >> now they're making money. >> this is the first quarter they're making money i'm just saying. >> think about uber and pulse pricing. if you were charging what it is

worth. >> call me if you really thought they were profitable entities, they would not be where they are. >> any of them over ten? >> over ten? let me look. i'll get you data. >> ual >> ual is capped at 11.7 >> we need them. we need them >> we need them. >> i drove last time wow. a lot of cars. >> delta airlines is a $19 billion company. >> jetblue 19 is still not a lot. >> i'm saying -- >> for a major international carrier? >> i'm saying the reason why it has $20 billion market cap because somebody believes it is a profitable enterprise and they will apply the multiple to it. >> warren buffett said he would

never invest >> he did come back. >> he did. >> he got his butt handed to him again. coming up, ev maker polstar going public we should call them spacs. >> everything else >> we can get ready for the next bubble

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welcome back. the dow up 225 points. it is friday >> it is >> last thursday when the world was ending >> it was a good week. >> last thursday >> the calming of the treasury markets. things feel better now >> it started on friday when the world didn't end the world almost ended on thursday friday was a little better this week, the sun came up every morning. >> it did. when we come back, the ceo of rite aid joins us the stock is still down 44% for the year to date still to come, we have details from inside the omro at the energy secretary granholm.

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welcome back, everybody shares of drugstore chain rite aid jumping yesterday after the company report add ed a smaller expected loss. hayward, thanks for joining us today. it's really good to see you. and i know that you have been dealing with a lot, trying to fix this company with a plan that rolled out just before the pandemic, days before the pandemic trucstruck the united states i know this has been a struggle. what can you say with these earnings that came in, better than expected ref now, but till some pretty big uphill battles

to fight how are you foalineeling right w >> it's great to be talking about something other than covid. it did become all consuming. so i'm just excited to be back to business. even though we are living with covid we are back to business and to our transformation plan we able to achieve a hundred million in ebita and we're back to business and our script pro was 1% up, even after cycling through this incredible volume of vaccines that benefitted us so much last year we're just excited to get back to defining the modern pharmacy and back to business helping

people thrive. and i think that this year will prove that we're able to get back on track. >> one of the most important thing you've done is push off this $3 billion in debt. >> it's a very important thing that we did, and we knew that we needed to do this when the market was hot and of course looking back, this was a good idea. we reduced our debt 200 million last year, and we have 1.7 billion in liquidity and also continue to shoot for in the lower five times leverage. so now we have until 2025 before we have to deal with any debt issues so that allows us to continue to invest in our pharmacy future, defining the art of modern pharmacy, invest in the assets

that we have, technology, mail order pharmacy we have the money that we need to do so and while we always dwoo want focus on paying down the debt this gives us some runway. >> you have competitors in the likes of walgreen's and cvs, but you are making sure you stand firm in places like new york city, philadelphia, los angeles, some of the laplaces we've seen walgreen's pull out from right behind us. it's hard to operate in some of these cities because of crime and getting people to stop stealing stuff >> organized retail crime is a really big issue, and we have been partnering with the local authorities, the police and those making the policies to really make an impact on these

local retail crime efforts, so we have seen good results, and we expect to continue to see better results, but it has been a challenge. it's unfortunate, pabecause it's upsetting to our associates and to our customers but with partnerships with these different authorities. >> we'll make progress >> real qing uick before you go there's a new plan that you can't use insurance, but the cost is de minimis and if you look at that rising model relative to what you can do at a rite aid or sees cvs or elsewhere, it is hocking do you think you could ever come up with a model that would work

the same way >> number one, i'm edxcited to see people getting into the pharmacy business because it is a great business we have the scrappiness to compete in some of those corner spaces we, like mark cuban, want to make drug costs more affordable, and we have a significant am of scale and buying power on generics, but we're so much more is this a big. >> complicated business. and we can treat the patient in different modern ways where we can meet customers where they are for all of their medication. >> thanks for coming on today. and i want to give you a shout

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the s&p and nasdaq, all three averages are on pace for their first pos tifitive week of the month. pole star ready to hit the street and i would have the company's ceo ahead of that fitrade. the second hour of "squawk box" begins right now good important, and welcome back to "squawk box" right here

on cnbc take a look at u.s. equity futures at this hour on this friday morning we do have some green to st if we opened up now, we'd be up about 225 points on the dow. take a look at bond yields we've been talking all morning about what's happening m in thi the economy. also oil, if you want to buy a barrel of gas reasonoline, $183 gallon you have pretty much everything up a bit you can look at ripple up about

12%, 13% this morning. let's check in with stephanie link at hightower and a cnbc contributor, and a philosophical question, stephanie. are you just bottoms up? is that basically the way at that you think your clients want to you approach this rather than top down you decide whether we have the ultimate lows to find opportunities. you might have an opinion, you probably won't, that doesn't inform your actual day-to-day activities on whether the activity is bottom or not. f >> well, good morning. i think you have to be a little bit of both. we're a little bit of macro and

lot a bit of pmicro. you have to tup ne out the macro how long does the fed go and how tight are they going to be, and the earnings picture so so far, so good. look at accenture yesterday. they beat. they guided the top end down a little bit that was really more currency, just like pmicrosoft couple weeks ago we got fedex, which i can't remember the last time they actually raised guidance, and they d id, 20% ebit but the macro is leading to a choppy environment and you have to pay atotention o

that we get the cpis, ppis in the middle of july those are going to be very well watched. oi on the other hand, i think it's good news that commodities are coming down a little bit in there are major divergences just in the averages you look it at the dow you feel one way, and then if you look at a stock, a great stock, a great condition like netflix many and you roo look at that versus the average drop in the dow, which is barely in bear market it's such a strange landscape to try to staff navigate through

would you say you're low or that it's better to be patient. >> it's a great question it's hard. i have a little extra cash more than normal, actually, because doi wi do want to be bug the dip. but this hasn't been a buy the dip kind of year or market it's been sell to rips yesterday was the first day as we sold off in a day you saw buy the dip. and the last couple weeks we've actually seen some of the really beaten down tech stocks, nasdaq, starting to make a little bit of a come back versus what has been working which is energy and materials and that sort of things look, i've been nibbling, i've been buying a little bit more estee lauder i did buy accenture. united health care has been just a champ.

i'm trying to find things for the long term and just trying to take poumore of a year to two-yr horizon. i know down the road i'm going to be grateful i bought high quality on asale it's re it's going to be choppy. it's still pretty solid. and at clooes we'll have a base case c can. >> 2022, mohamad el erian was

on, his was dip buying that ended on a dime, january 1, would you say >> 100%. i think it has everything to do with the fed and dplaings. the fed pulling away the accommodat accommodation inflation rising as interest rates go higher and the fed is raising interest rates, you don't want to own long-duration assets if we get any kind of clarity whatsoever on the fed. if we get any kind of comfort that commodity prices have not only peaked but are coning down

substantially i think you will see more dip buying. i don't think we're in theclea by any means, but i do think it's encouraging >> i find myself, you know, just obsessing about macro. and that's, i think if i had client that i needed to hold the hand of and suggest things and that i wouldn't be doing that, but, you know, i'm looking pour something macro that gets us out of, that maybe back into the secular bull that people say is still, you know, still in place, which there are doubts that it actually, it still is, if it's a sec secular inflation story, we haven't seen that in so long in 40 years, we've barely used the word inflation other than saying it's too low, we can't get back above 2%. it's jarring go ahead >> in the end, though, joe,

profits are the most important thing, right stocks follow profits. we're not getting a lot in terms of company earnings. we're focussed on the macro pa because that's center stage at this moment in time. there are some that disappoint and some that can hang in there. the ones that hang had there i think are the ones have the pricing power. earnings are expected to grow 120% this year >> thanks. good to have you on. >> thanks. good to hesee you. oil executives meeting with secretary dwgranholm to toalk au

oil prices the futures are pointing to a higher open. we'll break down what's moving rks ta about the fed's handling of the economy with mohamad el erian "squawk box" will be right back. girls... the chess club has gained an edge on our bake sales. we need more ways of connecting with customers, fast. i know some consultants with great ideas. can they help us improve our digital experience? absolutely. they've invested over $2 billion in tech. that could really help us manage inventory. and save us a ton of dough. then let's take back our market share. checkmate, chess heads. girls, i said “bedtime”!

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e the country's biggest banks passing the federal reserve's annual test of their ability to withstand market and economic downturns. the fed said more than 30 firms including j. pchblt morgan, mo morgan stanley and goldman sachs a have the cainbility. maybe we learned something >> too big to fail >> did people understand dppf?

i and a joe. >> smh >> fchb wchblt f wchblt >> jennifer gran only. and pole star making its debut we'll hear about its push to be a major player in the space. squawk coning right bang time now for today's avalancaflac trivia condition in 1999, google tried to sell itself to what online condition? the answer when "squawk box" continues. a shelf-inflicted injury. luckily, aflac will help cover his unexpected medical bills.

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we have new details on energy secretary jennifer granholm's meeting with the big oil kroechblts yesterday that meeting was construngtive the energy secretary was described as one who was looking for ideas to offer relief to so soaring energy prices. the problem is there aren'ta man available. one was allowing winter-grade gasoline to be sold in the summer that would be the equivalent of adding another refinery, but the winter blend uses more hydrocarbons like butane

it could krcontribute to ozone. the other would be the extension of the act that requires ships to be u.s. cruewed and flagged, helpful if you're taking from the port of houston to the port of new york if there's another hurricane or outage, but they are in favor of keeping the jones act. another tough sell with the administration ultimately, these decisions will have to be made by president biden, and he wasn't even at this meeting that he summoned the ceos to. there was a meeting with the

leaders of the wind industry so that gives you an idea of what might be happening here >> talk to this guy, joining us is john killduff, first, john, let's talk about, i know it's only june, but we've been talking a little bit about the winter that's coming and there, it runs the whole gamut of really scary disastrous scenarios to maybe not so bad. what's your best guess as to what happens this winter, especially in europe where we're worrying about people having heating oil or whatever they use in the winter. if it's a bad winter, there could be serious consequences beyond economic consequences >> no doubt, joe it could be a, not to put it too bluntly, but a heat or eat kind of winter at this point.

it looks like it's going to be rather expensive, whether you're using heating oil or natural gas for that matter. on the heating oil front, the refiners are running full capacity we've had many weeks over the past several that they'll be seeing an actual rise in diesel inventory. that's good news and also for u.s. consumers, there was the lng explosion that is keeping about 2 billion cubic feet of gas here siloed in the u.s., helping the inventory situation for natural gas to build uhp as well. so we have to keep our fingers crossed that we can squirrel away the acorns here it's a much different situation in europe. they need that liquefied gas that went offline. there's a missing element here that's not being picked up enough for some reason, with refinery

margins off the charts, china is, china's refining industry is running at a very historically low run rate the independent refiners are about 60% of capacity. the big ones, their units are rung running only at about 71% capacity the demand there impacted by on and off covid lockdowns, why they're not taking advantage of this export market is a bit of a head skrachber to me >> if were you to forecast where it is does it depend on the war in ukraine, on what domestically the biden administration does? do you expect we'll be at above $4.50 a gallon a year from now

>> i'm not so sure about thacthat amount, a, one of the biggest factors is the russian situation. this is a major supply disruption event, at least to the western markets. if we to wake up one day and somehow vladimir putin's out of the picture you've got a big rush of supply that could help the years and years and years of sanctions on venezuela has decimated that condition

vene condimpany. the u.s. has become a significant exporter of products gasoline, diesel, flying out of here at the moenlt we're more than taking care of our own. but the call on our stuff is trifx. so i mean there's a lot of moving parties here, and look, that minus 40 print on wti a couple years ago really wrecked the industry, really made everybody re-grooup. the other thing, too we've gloebly lost about 3 million barrels a day of refining capacity but it wasn't great until recently coming out of the pandemic. these units that were closed were closed for economic reasons. too expensive to maine ttain

what is consomeme some ing is ai biofuel. >> there's a piece from our friend harold forld jr he says a biden retreat could lower gas prices and that the president should unwind the bureaucratic hurdles to the permitting process among other things expand oil and gas leases on federal land and renew the five-year offshore leasing program. number one, would any of those things help? and is there any chance that prooibd would move to do those

things >> i think the pain at the pudge p and the backlash from the voters might push the administration to do something like that. to the extent that they've got signaling from the administration that they were going to review these things, warm up to the idea of allowing those very ideas from mr. ford, yes, i think that would hen to lower prices we are hearing of constraints prooiftly because of the e zchlt gchlt pressures. despite massive positive returns capital you are an a cnbc contributor. how long >> i think it's over 15 years, it's been a while. one of the first ones, i think

>> all right, thanks s of still to come this morng mohamed el arian joins us for his take on the markts what the fed should do next what the treasury markt's telling us plus polestar going public by a spac today we will talk to the ceo in an interview you don't want to miss stay tuned squaungs will be right back.

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be be be we have to see what's happening. the main thing is we can't fail at this. we really have to get inflation down to 2% we have to see evidence that it really is coming down before we declare any kind of vingtry. so i think we'd be reluctant to cut >> that was fed chair jfrmts

powell watching what's happened with the margts this week, maybe the fed doesn't have to do as mutch. i wonder if you think that this is a temporary pause, temporary calm, if there's more to come later, or if you think that this is now the new normal. >> so i think there's two different die naynamics going on the stonge mk market is a relief measure. we are having a relief rally the bond market is saying, whoa.

be careful, because the ceconom is weakening, not just in the u.s. but around the world. there's there's two difrp narratives >> i think it's that, but i think it's the data that is leading everybody. if you watch the trend over the last six weeks or so, we get more panicky every time we see one of these inflation numbs come out >> keep an eye on consumer sentiment. keep an eye on the p mchlt is i think we've yupd stood that inflation

we don't know yet the damage of the fedun being so late >>in >> tech companies in tech are laying people off. what does it tell you about the economy overall? how are you kind of grading where things stand >> so we very fortunate we have a very strong labor market there's twice as much vacancies as there are people unemployed i wish market participation were higher i wish wages were high are he. but it is a strong labor market. what you're going to see is growth slowing profits under pressure, and the

labor market is going to do just fine to begin with it is what happens next year to the labor market that's going to be key but i think in the short term this economy is supported by a very strong labor market >> if your concern is profits. if your concern is that corporations are going to have their march gins squeezed, do y think the market, the stock market at least, has seen menouh damage or is there more to come? >> they're going to come under pressure from the revenue side so far they've come under pressure from the cost side. now that the demand is slowing, the pricing power is going to erode. i think it's key to differentiate between different companies and between different stock. it's much easier for me to tell ah stock-specific story than it is to tell you a market-specific

story. >> is it anybody outside the energy industry at this point? >> you have quite a few in tech that are able to do that and quite a few in the real economy that are able to do that this is about name selection and about changing in your mind what are the key attributes for what's ahead and what's ahead is inflation staying high it's not unusual. there have been a lot of critics, yourself included, just about how the fed is slow to the game to raise rates. they've been slow to the game in the past unfortunately, the fed has been behind the curve in stopping

r rates. what are they going to be watching most closely? >> for them, it's going to be the inflation numbers and inflation expectation. at 10:00 we're going to get some feel for that. look at the last 12 months, and it's like watching a really bad movie over and over again. first it was denying that we had an inflation problem it took to the end of november to realize inflation wasn't trans-torrey second, it was not tightening fast enough. they lost a lot of time in december, january, february, march. they could have tightened more and the market went ahead of them the now the market is saying you are so late i don't think you have enough skill to compensate so

this market's going to slow down significant. that's the thirdle type the fed has lagged reality in the last 12 months. and that's problematic for the real economy it's problematic for the fed itself in terms of credibility and forward policy guidance. >> always great to see you thank you for wrapping up the week with us it's always better when the week is wrapping up better. polestar and so much more as we head to break. check out this morning's leaders and laggards, back after this. as a main street bank, pnc has helped over 7 million kids develop their passion for learning through our grow up great initiative. and now, we're providing billions of dollars for affordable home lending programs... as part of 88 billion to support underserved communities...

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welcome back to "squawk box. the futures continue to be solidly positive this morning. up 233 points now on the dow nasdaq up 110. chinese tech stocks are on the move this morning. alibaba, jd com, pin duo duo up

sharply. the ftse wrestles its indeces. this happens once a year and it has a big impact because it's track tracked by many funds. the weights in the russell will be reduced in the mbe meantime, gamestop will lose its place. s another headline to bring you. this one on netflix. the company announcing it is cutting another 300 jobs they got rid of about 150 people last month it comes as the company deals with losing subscribers and is be contp be contempt plating

adding advertising we'll talk about polestar, next and later, the problem solvers caucus, scott gott heimer joins us to talk about inflation and much me.or "squawk box" will be right back.

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programming note all next week, got a huge lineup on cnbc live we're going to bring you interviews with jim coulter, eric schmit and ken chenault we'll be hearing from jessica alba the ceos of wells fargo, bumble and so much more on cnbc >> a nice time in aspen this time of year >> we can only hope. >> pretty sure pretty sure. 3 hy 300 days of sunshine >> the worst john denver song, i love john denver, the worst one he ever did "aspen glow. look it up polestar going to begin trading today.

phil lebeau joins us now >> a lot of people when you mention polestar say i think i've heard of it, i'm not really familiar with these guys you should be familiar with them they already have evs out on the road including here in the united states. and the company is going public. let's give you background on polestar so you're a little more familiar with it it is a subsidiary of volvo and gili production in china right now. but there is a u.s. plant that they are planning on, ultimately bringing production to so they will be building evs here in the u.s. in terms of the spac t's going to be trading under psny it's raising $890 million.

gores gores guggenheim is behind this. will it do better than other spacs in the last year, year and a half in time will tell it has not been a good ride for any of the auto maker whose have come through the spac. of these four, lucid is the only one manufacturing vehicles out in production right now. still in the planning process when you look at fifx kerr this is a highly-anticipated spac if you will, because people are wanting to see what polestar can do about 50,000 vehicles worldwide are out on the road right now from polestar. >> philadel, stick around we want to welcome the polestar

ceo to the show. congratulations on theis milestone. as you think about being public, it's been a year since this whole transaction got to this place. but we've also seen the challenges that other electric vehicle car makers are having in the public market. are you, are you happy that you're in the public market? if you could do this all over begin, do you think you'd be better off in the private market >> hi, good morning. well, no, definitely have to be that now, very proud moment to start our first day as a company trading. i understand market conditions are not easy having said that, we saw definitely that especially in the circumstances, what makes polestar polestar and what makes our business attractive to investors actually stood out more, more clear in this

circumstances. you mentioned yourself, we are up and running we have 50,000 cars on the road. we're producing steadily this is a very different time for a startup. >> when you think about the future of this company and what it's going to take to scale at the level that you want, what's your sense of having to go back to the capital markets in the future to raise additional capital? that's clearly been something that's weighed on the stocks of a rivian, of a lucid, and you've had people like elon musk say that those two companies may be trending if things don't change toward bankruptcy. >> well, we talk about our model being an s-like model. what we want to achieve to 2025, 90,000 deliveries in 2025.

three models to be rolled out over the next three years. all of that is part of our business plan, which is, we use manufacturing foot print we use workshop that exists in a group. and for that reason our path to achieve that is on a different scale. for that reason, i think, this is very attractive way of doing it, and the capital apartment funding that is needed, we will, along the way have different estimates coming but this 90,000 coming in now. this's an estimate >> phil has a question for you phil >> hi, thomas, how are you this morning? my question for you is right now you're manufacturing in china, but you do have plans to also

build in the united states give us a sense of when we will see that likely be identified in terms of hey, here's a location. here's where we're going to start manufacturing vehicles, when you expect manufacturing to start here in the united states. but paint a picture, if you would, of that part of the business plan. >> yeah, that's very clear defined. we'll introduce our next model in the united states we're operating this factory and we will have this up and running in the beginning of 2024 and this is a big part of our strategy to have a manufacturing foot print that goes very much in line with where our customer is and we will have a manufacturing

footprint following exactly that type of propulsion >> i think about the competitor. obviously, you compete with all of the auto makers out there but specifically, if were you to sit with a whiteboard on a monday morning and talk with the folks that you are really looking at that you compete with directly, who would they be? >> very clearly positioned in the green electric segment and that position is defined with competitors, obviously from traditional market, mainly porsche for example. but then we will be in this competition presenting our offer, which is a mix of, on one end, very sporty, great-to-drive car, super attractive design and

great creativity that people expect from aeev >> how do you feel about competing with volvo because the style of your vehicles is often compared to those? >> yeah, we have scandinavian design but the arena of scandinavian design is quite broad. i'm pretty sure, invite to you come to our prelaunch in october, once wry e are full out there with our future model lineup we will be fully defined, our avante guard, exquisite design, and there's room enough in the world for two scandinavian designs. >> what you have done is leaned into a partnership with apple of sorts. apple announcing its next generation car play, which could control the entire car, including air conditioning and

the like other makers haven't leaned in the same way you have. why have you done that >> two things about that a, integration, like we do now with google and new generation of apple car play is for the customer, for the consumer a great delight to have this access to modern application, have theis access to google assistant. that is the eye of the customer the best thing to do as a car producer, rhett's face it this is not the core architecture of what runs the software of the car. everything, the safety system on all of that is our own software.

the intertentertainment is a pln and we make it a great product where both things work very well together the car, the drive function. >> i think that's something maybe volkswagen and others have leaned away from is that apple will eventually use that same software in its opwn car do you think so? >> i look at the companies and we will find a lot of prominent once who by now realize this is in the eye of the customer a big, big delight, and a modern way of the future. >> we thank you for joining us we wish you well, and we look forward to following your progress >> thanks a lot.

coming up on "squawk box," congressman josh gottheimer joins us and as we head to a break, a quick check on crypto. back at 21,139 for bitcoin, well up from where we were on the weekend. over the weekend it fell below 18,000 it's been steady above 20 ever since. and this mniorng, above 21 you're watching squaurks, and this is cnbc ay video games? sure! ...after homework. thankfully, voya provides comprehensive solutions, and shows me how to get the most out of my workplace benefits. what's the wi-fi password again? here... you... go. cool, thanks. no problem. voya helps me feel like i got it all under control. because i do. oh, she is good. voya. well planned. well invested. well protected. what if you were a global bank who wanted to supercharge your audit system?

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. good morning more green on the screen futures are up we will tell you what to watch in the markets, and signs of progress coming out of that meeting between the biden administration and oil executives short-term solutions look like a stretch. on that note in a few minutes, we're going to talk about how we got to this point where the company feels itself squeezed on energy and what we can do about it from here the final hour of "squawk box" begins right now

good morning, and welcome to "squawk box" here on cnbc live from the nasdaq market site in times square i'm joe kernen with becky quick and andrew ross sorkin i don't want to jinx anything, but we can end okay. i don't want to talk about it, it might not happen. but the nasdaq up 85 s&p up 25 and change and that would put the s&p at this point on a fairly decent bounce from some pretty scary levels that we saw last thursday close yesterday at 3795. add that on, and you're up at 38 and change some say clear sailing at 4,000. intermediate nobody knows the ten-year kind of behaved in

terms of yield we could live with three to 3.25 i guess. oil prices also have not added to the fears of inflation being more persistent than we thought. we're down 105 >> 105 i haven't seen the latest, but we've come down from $5 a gallon every day. we do have new details on energy secretary-ge jennifer granholm's meeting with oil executives yesterday that meeting was conductive. the energy secretary was looking for ideas to offer relief to she's these soaring energy prices.

one idea discussed was seeking government approval to allow winter-grade gasoline to be sold in the summer. that would mean the industry could probably refine a couple hundred thousand barrels more per day and that would be the equivalent of adding another refinery to the country right now. but the winter blend does use more hydrocarbons like butane, that evaporate more quickly in the summer months. it could contribute to ozone formation, attributed to smog. another would be to suspend elements of the jones act that requires all vessels that sail between one u.s. port to another u.s. port be u.s. flagged, u.s. manufactured and u.s. crewed those ships are hard to find and cost about four times as much money. amending that would apply to

going from the port of houston to the port of new york. somebody's excited back there >> saomebody's jumping up and down >> even though jennifer gran granholm may be taking all this in, president biden did not attend the meeting yesterday this is where he sat down with executive from the wind industry this is where you did see they're talking about offshore wind going through offshore wind, but the crisis more about what's happening with fossil fuels >> james bullard speaking at conference in europe he's in favor of moving rates

t up to 3.5 this year. it would be a moderate slowing in the u.s. economy. he said the u.s. would be fine and bullard said unless we get hit by a big shock, it would be unusual to go back into recession at this stage. let's talk about that and so much more on these headlines joining us of course a cnbc contributor, do you think bullard's right? is that a soft landing >> that's going to be a tough call, andrew the right thing to do is raise rates and raise them fast. but i'm not sure that's going to cause in the economy things are already slowing down. we're seeing that in terms of retail sales, demand destruction. so you could get, you know, a big downdraft m in it.

the market's already come back down part of it's already been done in terms of the stock market what will be interesting to see is what happens for the economy if rates go up that high right now with higher oil prices, higher prices for almost everything, i think things will slow down. the question is how fast will they slow down and how much damage will be caused? >> has the market already moved? it seems like things are stabilizing. is this a dead cat bounce? some summer thing that's going to lull people into a sense of complacency and the fall's worse? or green hours ahead >> so, you know, having two weeks before this one, down 5% each week was something we hadn't seen in a while so it's really 2020. that was a different issue i think what investors in the market are looking for are what earnings are going to be right now, yes, we could be in this lull period where hey, we

are down 20%, how much more with they come down and you saw fedex and a couple other companies raising their earnings estimates what the market wants to see, what are the true earnings of the s&p, what are the true earnings of the companies and from there what are the growth expectations i don't see another major shoe to drop, but i do think there will be companies that will get hurt, especially those that have higher input prices and can't pass pricing on. >> if you have cash on the sideline right thonow, what do u do you wait >> if you have cash on the sidelines, and you have not a 12-month outlook, you have good options. you can buy high quality companies like ingersoll-rand. and in health care there's

really good companies like bristol and j&j. you can say i want high quality, cash flows, growth, is it going to be a bumpy ride of course. when things get better, do i want to be in areas where the consumer's really going to be spending in? like travel, uber, delta they have great balance sheets and qucash flow. >> we're showing a list of the faang stocks would you go near them >> so i would. >> "wall street journal. >> i saw that this morning and i think you could look at google definitely because the sum of the parts is greater than the whole. i think facebook is a true value play in terms of can they turn the ship around and how much of their business is really going to be affected by advertising,

and then i think, you know, when you look at an amazon or microsoft, they're all good companies. i think now can you own them, but you don't have to own them in size. there are plenty of other opportunities out there if you have a longer view because the growth rate of these sore compa other companies is going to be just as good or better >> when you talk about etfs or actively-managed funds, we have a lot of viewers who aren't necessarily playing each stock day by day, what would you do? >> 401(k) plans have this. you can't pick individual stocks you can say i don't want to be just in the s&p i want to be in the russell value. i would look at a mid cap value

fund i think there's opportunity there. and then also look at the dividend growth players also those are companies growing dividends in rising inflation, and those that have pricing power. you get exposure there and then i would take a piece of it if you want to get a little bit of international exposure, pick a global fund, not one just directly to emergeing markets. on the bond side, stay with short duration rates could still be rising, and people in bond funds are down 15%, 20% short stage during air, you're getting 2% or 3% until we get some type of clarity as to where we're going to go with interest rates. making sure that are you exposed to all types of market tass thae

going to do well >> have a great weekend. >> thank you, you too. we are going to take a deep dive in just a little bit into new quarterly results from fedex. up next, though, we're going to talk inflation and energy with republican congressman josh gottheimer we'll see what he thinks comes next before we head to a break, first up, australian air carrier qantas cutting its domestic capacity through early next year as it dweeals with high fuel prices and staffing issue. and zen desk close to a deal that stock up close to 50% this is cnbc you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates

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welcome back to "squawk box. futures up 242 now in the green. the dow indicated up 30 and change nasdaq up 105 if you're just tuning in. fed chairman j. powell

wrapping up a big week of testimony saying that the fed underestimated inflation but it cannot fail to bring inflation back down. >> we are mindful that even though these things are outside our control that gas prices and food prices for the most part, that add as little bit of urgency in our wanting to get our rates into a place where we're addressing inflation directly because the public rye eacts tol kinds of inflation we don't think we can use our tools to change energy prices, but we do think that they add to our desire to get expeditiously to the appropriate levels. >> our next guest serves on the house financial services committee where fed chair powell made those comments. joining us, josh gottheimer. congress been, watching what fed

chairman powell had to say, do you think ha that is up to the k of tackling inflation? >> i think they're going to have to be. the number one priority very is ma i have is making life more affordable for the people i represent get the costs down but avoid steeper challenges the chairman spoke about the measures the fed's taking, and we'll see actually in the weeks ahead what's going to happen there. >> josh, i know that you're looking at things in your district, things like higher gas price, things like higher food costs just as he mentioned i know you asked him about the cost of housing as well. you think it's being underrepresentative with a gain of 5.5%? >> that's my concern

when you look at housing prices in northern new jersey, becky, prices for buying a house or for renting are way up i know my congressmen around the country are experiencing the same thing, soy want to make sure it's accurately represented in what the fed is grappling with but also making sure we're aggressive on energy, prices on oil and gas. for months i've been calling for an all of the above approach, getting our capacity up. we have 9,000 permits outstanding. we need to do more, we can't look to terrorist iran or communist venezuela. we need to get up our domestic capacity try to reduce prices, and the same could be said at the grocery store. we talked about this last week we took legislative action on prices there and collusion in the market place in the meat and poultry space. we need to make sure we're doing

all we can on all fronts to combat rising prices >> the energy secretary sat down with the oil ceos at the white house. they came up with ideas, but i don't think they are ideas that the administration or other democrats would support. one would be to start selling winter grade gasoline in the summer it would give them about 2% excess capacity, allow them to do more when they're already using the capacity past 90%, 94%. but the down side is it comes with an environmental cost butane is one of the chemical compounds put into that. it evaporates much more quickly in the summer months and it could contribute to the ozone. you could get hundreds of thousands of barrels more a day but it will come with an environmental cost, which side would you choose

>> the secretary talked about several issue. i think a very good move would be to sit down and talk with them that's what we should be doing, not just beating them up but trying to solve the problem. i think everything should be on the table. but we have to at the same time be doing everything we can on fighting climate change, alternative energy it's a false choice to say you have to pick one or the other, you have to do both. we know how much it hurts when prices go up at the pump for families we've got to study that up and down but, you know, what we can't do is say we should flip a switch and think we are going to solve th this problem overnight and not realize it's a transition. >> let me throw her to another r way. if you don't want to go with the winter grade gasoline. >> i'm not against that. >> sometimes life is a series of choices, and you have to pick

one versus the other and i think some of the best solutions could you possibly have are ones like that. i don't know what the answers are, but you are the one who gets to vote on that another one they talked about is getting rid of some of the jones act issues temporarily so you don't have a u.s. manufactured ship, u.s. crewed that can only take oil from one u.s. port to another. if you are doing it because of a hurricane, if are you allowed to use other ships, maybe foreign-flagged ships that you could move energy around the country more quickly however, it's not something the labor unions are in favor of because it weakens u.s. jobs what do you think? >> if are you in a crisis you have to take every measure all those things, you know, what

i think you need to do is look at each of these and make choices. what you can't do is say everything is off the table and we're not going to consider anything that doesn't, you know, immediately solve every problem, you know, and the way i look at this, and i've reached out to the secretary about it and obviously, i've said the president should continue to brit bring the oil and gas executives into the white house and have these conversations, even though some people don't like it. not everybody thinks we should do an all of the above approach. i think we should. i think we have to apartm and the two suggestions you just maidde are the types of thn weise things we should be making the decision on. that's at the pump, at the grocery store. the fed chair would have to do

the same they fed. but we have to move fast here to help families, and we can't hem and haw about it >> i agree with your approach. the president didn't have time to stop by that meeting yesterday. is that a mistake in your opinion? >> he should have. yeah i mean, i've opibeen calling for months now i think the president should sit down with them you can't fix a problem. you see what we're doing, democrats and republicans on gun safety is it everything no but is it steps in the right direction? yes. you're going to have some democrat whose vote against it, republicans who vote against it, but there are enough reasonable, common sense people who want to sit down and get there and i think we have to do the same thing on energy here i think the president should be at the table >> congressman gottheimer, we

appreciate your take we've been discussing this, debating it all morning. we're going to have more on that and you don't want to miss and what can investors expect from wall street's biggest banks. we've got the story and fedex earnings when squawk returns 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.

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i am always loathe to say

sad news, but this is sad news fanatics is in talks to buy tipico the two sides are said to be stuck on price tipico is small in the u.s. and only has licenses in jersey and colorado but is the leading sports betting provider in germany. michael reuben, friend of the show announced that he's selling his 10% stake in harris blitzer sports entertainment >> oh, no. >> he has to >> the 76ers >> you can't be an owner -- >> that, but he's been so successful >> a market cap, does it immedianeed t go up? that would clear the way for

fanatics to enter the gambling world, because nba rules prohibit team owners from entering gambling. we talk about the rationale, you know, baseball kind of tough to figure things out, but if you remember the official, i think it was ncaa hoops official that got in trouble, because it's really not that hard with some betting things with points an over under, the guy scores 27 does he just not shoot at 25, if you show someone who wants you to not go over there's a million ways with basketball. >> i wonder. >> that you could use it well, there are. the field goal kicker's going to, whoa, geez, i missed it by 80 yards i was trying

there are just a lot of ways >> you go back to the black socks. >> it's harder in baseball but it's just rife >> pete rose, pete rose. >> pete rose >> that was weird. he could have left pitchers out, but that's not as easy as point shading, point shading this basketball >> you never want the appearance of impropriety >> it's sad. >> it's said for michael he loves those >> he loves the sixers >> good seats. >> i think he's keeping the seats. >> he can afford them >> there are a lot of people who own teams or pieces of teams >> they like being involved. meantime, another familiar name to squawk viewers withness this morning ken griffin, the billionaire investor moving his hedge fund firm citadel from chicago to miami. this was telegraphed a long time

ago. he had already relocated to florida personally in a letter to employees he said he views florida as a better corporate environment. crime was a consideration, though it wasn't directly mentioned in the note the earlier this year, griffin had suggested he might move operations out of illinois because of rising crime rates and incidents involving employees in chicago he's been a long public dispute with pritzker there. >> that's a big -- >> and by the way, taxes are lower. >> that's a huge point the illinois tax base. just losing caterpillar's headquarters several years ago, we sat down with warren buffett, yeah, if i was looking for a place to put a company, probably not there, given the disadvantages you have being in a high-tax state like that, it eventually catches up not just drive out old businesses but making it tougher for new businesses

>> he summarized how many incidents had happened to employees at citadel >> in terms of crime >> yes. >> he's been very vocal about crime specifically in chicago and how he think it's head it harder to attract talent he thinks it's going to be easier to attract talent he doesn't talk about the taxes as a reason, but that's a biggie >> snorkel there fedex issuing an update. hey, frank >> hey, there, joe fedex trading higher after mixed earnings the new ceo said pricing power was the driver for this quarter, air delivery, e-commerce delivery and freight express and ground missed on

margin estimates there are signs the economy may fall short of fedex's projections, but he remains bullish. >> we prepared to pull some levers here. we are moving making sure significant cost controls and we're operating in a very constrained environment from that perspective but just take down flight as required definitely not assuming a prolonged, deep recession that 's , that's not what we're assuming here we have worked through many network inefficiencies caused by staffing still, covid-related conditions slowed global recovery >> fedex outperforming u.p.s. and the s&p 500 since he was appointed ceo june 1st

coming up next week in memphis we're expected to hear plans about enhance shareholder value, including increasing the dividends by 53% >> if there was one company that you could know everything about and trying to make determinations about the global economy, is there a better proxy for, i mean, i think about, inflation, supply chain, a strength of the economy, whether people are, you know, how many packages you're shipping versus a year ago. just across the board, it might be the one thing you'd like to know if you could pick one thing if i was on a desert island, what's the one food or the one song would you listen to >> i would do hard-boiled eggs >> i don't flowknow what that i, joe. that's probably before my time >> maybe fitty cent in the club. >> for food. >> what food

>> seafood, shrimp >> be plentiful. >> yeah, great example of the economy and what's going on. we also have exposure for the spot market. think purchased transportation for their ground unit. that's how they move their e-commerce market. the one thing i think is really important about this is they're not down on the economy. of course it's not in their best interest but interest trucking business put a putting a load on the same truck, gives a lot of insights and seeing those rates higher and volumes higher is a sign that maybe potentially this recession that we're all worried about may not be coming in the near future. >> all right, frank colin. >> fitty cent in the club and i'm going to change it to crab legs >> you might be able to get those if you're, crab trap

>> maybe, i don't have that skill. >> but you'd need butter, though maybe get the butter and catch the crab >> when are we doing the podcast? last week we talked about starting a pod katcast and we n followed up. where are we >> we in negotiation >> i heard you're in contact joe was like why don't we do that here at cnbc. they told me they've been talking to you, andrew about getting on the podcast they wanted to send you a tee shirt, they asked me what size you wear, i told them medium >> that's right. i am totally medium. you should check this out. >> i'm trying to be a medium i'm on my way to a medium. i'm in training for a medium >> but i think we should get that going >> all right

>> and it could have, like frank's doing it, there could be a connection >> frank farmed it out to me i thought we going to do it together and then you said you should do it i thought we had a good idea the two of us, maybe the three of us. meantime >> four. >> let's move on and talk a little bit about banks the latest round of government stress tests, leslie picker join us >> despite a tougher stress test than last year, all three banks came above the threshold didn't come as a surprise that the banking system is well capitalized. but the a excess capital has deteriorated they have muted expectations for capital return announcements never required to disclose their buy become and dividend plans.

they are forecasting a 77% average payout this year, down six percentage point from 2021 levels the firm say the s many of the largest banks will have lower payouts. in a recent note there could be downward adjustments if the quote, macro environment were to sour and banks took a more defensive stance in their capital. this is the time when investors will be parsing through jamie dimon's comments to size up how conservative each firm will be with their balance sheets and what that means for capital distribution coming up, lessons from the u.s. from spiking prices on the gas pump we'll debate the take aways from heidi heitkamp and judd gregg

always a fascinating conversation you're watching squawk on cnbc they'd huddle.... welcome to the peytonverse. squawk on cnbc you're watching . you go. no, you go! double our investment and in omaha!bles...you'c 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.

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welcome back this is "squawk box. right now the futures are indicated sharply higher dow up by 230 points the nasdaq up by almost 100, and this comes on a very strong week the averages are on pace for their first positive week in the month of june.

for the sand the nasdaq this isa welcome respite. we've been telling you about that high-level meeting between energy secretary jennifer granholm and oil executives. it was high level but didn't include the president. he was engaged in a, would it be called a quixotic meeting with the off-shore oil industry i think that works but the general lack of short-term solution to the problem of sky high gas prices is raising new questions about america as overall oil policy. joining us, heidi heitkamp, a founding board member of one

country country. you'll give us an honest answer. and judd gregg i'm going to start once again. harold ford jr. ought to send me royalties. his war on fossil fuels has proved costly for american consumers. he outline a lot of things he's a democrat, a democrat congressman. he acknowledges that the biden administration has had head winds. do you acknowledge that? and what can we do >> first off, let's just acknowledge that covid and investor concerns about the lack of profitability when oil was at $40 reduced investment so let's just set a baseline but you've got to send the right signals to this industry you can't say hurry up and produce more and oh, by the way, you're on a limited leash and you're not going to be

profitable going into the future he's right about setting long-term energy policies, and you can't do climate without figuring out how you're going to work with the major producers of energy in this country so were their biden missteps yes. did biden's missteps create the crisis we're in exclusively? no the important thing to me, joe, is let's just get rid of politics for a minute and let's talk about what we need to do to build a legitimate energy policy that addresses decarbonization >> but we can't, because a lot of these things are, they're mutually exclusive what needs to be done, judd is the lobby, the green lobby is not going to let these things happen, and they seem to have joe biden's ear at this point. >> first off, i agree with what heidi just said. i agree with harold ford, two of

the rational folks in the democratic party, but there they're not in charge of the democratic party at the moment they're run by the esg movement. to some degree, they're crocodile tears. some of these folks demanded that the price go up and there would be less rely iance on car running on gas i think it's somewhat disingenuous, and the point was made distinctly by the president, he meets with a bunch of people who make wind mills and sends the energy folks to meet with jennifer gran hholm wo is a good person but doesn't have the ear to solve this is pretty simple three words, supply, supply, supply and you're not going to get the

supply if you don't allow the companies to make an investment that they can get a return on over the long term these are hugely expensive building a refinery costs billions of dollars, even drilling is expensive. if they don't get something to build a return on, we're not going to get the oil we need so this is a truly self-inflicted event yes, heidi's right, it didn't current material on this administration's watch, but the future of the problem is occurring on this administration's watch, apartment and the future of the situation is that this administration opposes the energy industry to be effective in the area of returning, of returning capital, of returning profit on the capital invested over a long term and that basically is why you're in the out years going to continue to have this problem. i do suspect, however, that

we're going see some demand destruction destruction occurring pretty soon people are going to stop using as much gas as they normally use. i suspect the price will come down, i suspect we'll be around $80 a barrel by this fall, but that doesn't solve the problem, how do we transition from an oil-based policy to a renewable policy in an orderly way instead of haphazard and creates these issues for main street america >> if you guys were looking for a debate today, this is one of those rare occasions where the governor and i are absolutely in synch. can you not do what this administration set out to do, which was to de-carbonize in five year, ten years, whatever

their goal was, without sitting down with the industry that produces the majority of energy in our country and one of the things that hasn't been talked about, joe, has been we're going to go into the winter heating season. we're seeing record-high electricity prices, record-high natural gas prices this isn't just about gasoline at the pump. this is about delivering affordable energy, especially for those people who struggle every day to make a paycheck stretch to the next paycheck >> even more important than that is what's going to happen in europe they're going to go through a horrific situation and it's going to cause a very severe recession and obviously a lot of trauma for the european people. and that's going to wash over onto our shores. they're a big buyer of our products we're big buyer of their products if they can't produce products because energy is being rationed, we're going to have problem, they're going to have

problems this is very bad public policy, leading to very bad activity in the economy. when you put industrial policy on a political correctness track versus a market-oriented track, you end upwith bad things happening to an economy, and the people who suffer are main street america >> and it's just not policy, governor, you've got to recognize that we will a pandemic which reduced supply, which reduced investment coming out of that, we saw a big spike in demand which created supply-demand challenges, and on top of that, you have a war which created huge energy disruption in europe so all of these coming to a confluence creates a real, i think, opportunity for all of us to think about what is that energy policy of the next 30 year look like and if you're saying we're going to totally get rid of fossils in the next five years, you're living in some kind of dream world. it's not going to lap. just, we could even get into the discussion about critical minerals and battery storage

we just have to be realistic and apply facts to our problems. >> you're absolutely right on everything you just said, heidi. >> we got to go. do either of you know, i often wonder, i mean, i know president biden is the president, but who to you think really has his ear in the white house who's calling the shots? do you hear? >> you're probably not going to believe theiris, joe, but i havo idea >> ron klain >> nobody talks to me. it's perfectly reasonable that they wouldn't. >> i think you dance with the ones who took to you the dance, right? so when you look at it -- >> is that bernie? >> if you're honorable >> okay. all right, heidi, thank you. governor, senator, you're not jealous.

he's a governor senator, you're just senator, heidi. >> c >> you can correct that. >> thanks, see you later coming up, kramer's first t take -- we're going to bring you interviews with jim coulter, eric schmit. and ken chenault make sure to watchful coverage of the festival. we'll hear from jessica alba bumble, wells fargo and so much more all coming up on jacsquawk new c? we got iphone 13s, too. switched to verizon two minutes ago. (mom brown) ours were busted and we still got a shiny new one. (boy brown) check it out! (dad allen) so, wait. everybody gets the same great deal? (mom allen) i think that's the point. (vo) now everyone can get a new iphone 13 on us

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all right. the potential zen desk deal we told you about earlier is now official the private investment group buying zendesk, their shares up right now by about 30% let's get down to the new york stock exchange and check in with jim cramer jim, have we turned a corner or do you worry that this is a temporary issue? >> no, i mean, i think there's been this amazing collapse in commodities, whether it be the grains, whether it be the

metals we're not talking about it enough either it's going to be a truce and we don't know about it in ukraine, or it's just entirely possible that interest rates went down. we talked about it, when they're going down, powell may be winning on some fronts i think it's pretty bullish. >> it's interesting because when you talk to ceos, they're not convinced that inflation is going to come down anytime soon. brian cornell was just saying, especially when it comes to higher freight costs, higher shipping costs, higher energy costs, he doesn't see that coming down at least until next year this week has been a good week, oil back to 106 from 120 we just had judd gregg on, he thinks it will be down in the 80s because of demand destruction. >> no, i don't think there's that much demand destruction a peace deal with ukraine, it

seems like it will be affair imperative for some of these eastern european countries i think you'll see better prices the europeans do not want food riots, which are happening all over africa. sri lanka is falling because of the food riots they see the writing on the wall, they have to stop this i hope they don't do a munich from 1938. i like brian cornell, i think he's terrific, but he himself has created a glut in everything that's hard goods because he's been trying to offset this stuff. i think there's enough going right. we just need to see the housing complex retreat in price and then i think -- look, jay's doing much better. >> i meant to mention it earlier today, 1825 on gold -- yeah, gold is there anything that is an inflation indicator anymore? because that couldn't be it.

>> no. >> because that was there -- i mean, it's gone nowhere in -- i mean, it's up a little bit but 2012 was 1750. >> that's been worthless i've bought into that nonsense i also bought into crypto for a while, thank heavens i got out get this, joe, you'll love this. after i sold the crypto, they actually sent me a check for the money, i got it out. >> that's good >> i didn't have the seal of approval >> if it's secular inflation, gold should move >> because it's not secular. it's not transitory. it's the russians and the chinese, neither, by the way, are friendly this very much reminds me of that manchurian candidate period, with frank sinatra, not the second orate one >> thanks. see you in a couple of minutes ssnday on "squawk box" don't mi our live interview with ken

langone. >> he'll be on set 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. hybrid work is here. it's there. it's everywhere. but for someone to be able to work from here, there has to be someone here making sure everything is safe. secure. consistent. so log in from here. or here. assured that someone is here ready to fix anything. anytime. anywhere. even here. that's because nobody... and i mean nobody... makes hybrid work, work better.

final quick thoughts ahead of friday morning's opening bell i want to bring in jim paulson we're all wondering, are these green arrows here to stay, is this a head fake into the fall, will it be better, worse what do you think? >> if you think about where the fed gets its direction, andrew, i think that's what's positive

here i think it takes it from the economy and it takes it from the bond market. and the messages coming from both are now telling the fed it better think twice about tightening much longer because the inflation evidence is coming down rather significantly and quickly. the growth evidence is coming down rather significantly and quickly. the bond yields have gone from 3.50 to 3% in seven trading sessions on the ten-year there's a lot of positive catalysts. what if oil goes below $10 a barrel what if we get a negative gdp print? all of those would force the fed to -- i think that would be a positive thing for the stock market >> does that mean you're a buyer? >> i would be, i have been, i've suffered through the downside but i certainly would be i think inflation peaks

historically are really good things for the stock market. i think we're in one we had three of them, 1970, '74, '80. the year following each one, even though we had a recession in every case, the stock market went up dramatically, 8% in '70 and 30% plus >> take that to the bank jim paulson, thank you i'll see you in aspen. "squawk on the street" begins next see you in the week. good friday morning and welcome to "squawk on the street." i'm sara eisen here with jim cramer today carl and david have the morning off. take a look at futures, it looks like we'll build on some gains we're having for the week, first up week in the last four 221 on dow futures, s&p up 27. our roadmap for the hour starts with the markets trying for their first winnin