>> i want to leave 30 seconds because there is a green number on our screen for the nasdaq. >> a try to rally a couple of times yesterday and finally succumbed. yields are down a little bit maybe. we will get a lot of earnings and inflation data this year. we have all of the banks on thursday and friday. >> you love thanks. >> i do. >> it's like painting grass. make sure you join us tomorrow. good tuesday morning, it is time for squawk on the street. the dollar is paired with the euro. germany got the tenure close to 9 and the nasdaq may perform below 100. stocks are

set to slide for second day. but twitter is firing back at elon musk and accusing the tesla ceo of knowingly breaching his agreement. and shutting down the biggest ever stack and just giving the money back. and the markets with concerns about global growth. >> it is so bad it looks like a misprint. then i don't all time low. >> i did the research today and it is so negative. i talk to people all the time about how much is it going to be down today? nobody thinks it will go up. the research is endless and the price is left over. when you read the research, you just say, sell

everything. yet, i'm telling you that is the wrong instinct. >> yes, i'm looking at your note here, your great node every morning. apple is lower and csx. and it it is analysts bringing their targets down. >> they are also to too high. >> i think that is the lesson this year that the markets are silly. i've been saying it 25 years, they are silly. >> it is a company we all know, the gap. people were willing to buy it at 9 and they are cutting it to 8. >> the comments today about union pacific are exactly the opposite of what i heard is going on.

>> they are trying to swing down the number of people on the training getting it to 1. then the unions hate that and so i loved it and now it turns out the things i love is a sticking point of why i should hate it and it is very depressing. >> they do talk about lower coal prices in addition to the labor issues. you are right about political and regulatory issues. i loved the rails because they were doing great. then out of nowhere they are fewer cargoes and the markets in recession. i wish people were forecasting a recession then, but it could go down mor . >> we are now beginning earnings seasons. enough for

the price targets, we can see the numbers and the guidance and whether the market has effectively adjusted to account for what may be a slowdown or may be a sign of a slowdown. >> there are places to go. like pepsico. >> that was a strong quarter. >> it was a very strong quarter talking about 10% organic. i thought this was interesting with supply chain problems getting better. remember that bedeviled them and frito-lay is doing terrifically. the dollar, which is going to be in issue with many, pepsico does not lose light caterpillar does to q botta or something. i thought this was amazing. >> frito-lay up 14 and soda up 9

. volume was still flat which is not at all what we heard from target and walmart that consumers are trading down. >> the consumer has money left from the pandemic. >> there was a note today about and american express downgrade. i downgrade and that's one of the companies you don't downgrade. in essence they were worried about defaults. they are worried about the consumer. >> and axp, morgan stanley is about cutting back on discretionary income and one downgrade isn't bad. >> i think the ceo would say, what are you talking about?

we've been saying business is really good, what are they talking about? >> that doesn't mean it's not coming. do have a lot of visibility? >> of course they have visibility, does he have a crystal ball? are we back in kansas here? he has what i would called data. by the way, goldman downgraded and it didn't go down. and ai lending, i think they are looking at the charts and saying, i can't take it anymore. >> [ laughter ]. on the flipside we haven't upgraded j.p. morgan and city goes to buy. with a higher capital and lower buybacks plus the upside to earnings. >> i love that call and one

reason i love that call is because hurricane diamond made comments off-the-cuff and i don't think they are indicative how the company is doing. but, i am a believer that with the fed rate they will make a ton of money. you remember 1990 and 1992 with what happened when the banks were liquefied? the banks cannot be liquefied. they made so much money. >> where is your checking account? >> j.p. morgan. >> you are chase and i am chas . >> i think your chase checking account will go up by two cents but they will invest at 2.5. >> i try to keep as little as possible there because they pay you nothing. >> most people are not as savv . >> if you look at the goldman

sachs product, it's now 22%. >> and three year treasuries. >> three year treasuries are 50% . i will move the treasury market by saying that. >> i'm sure you will. >> i thought it was a bargain because everyone is so confident about the recession, i'm going to crush it with a three year, crush it. i was going to say crush it with clorox, but i'm worried about kingsford. the credit losses in a downturn are normally access credit created in advance, something we didn't have this time. >> how many times do people have to come on? how many times does brian monahan have to come on and say the balance sheet is the greatest i have seen. we have numbers from st. louis showing the confidence level of the actual business people.

with the service down and the stocks down 5, other than the dollar, everything is good. but are we missing? >> we are taking lithium and if we got off the meds -- >> so you agree? >> this morning there was a democrat fighting with joe. >> yeah. >> he was saying things about the oil companies not producing enough. but i got schooled by the administration because i said the oil companies would like to produce more. the administration said to me, we are producing more than ever, look at the numbers. >> when you bring the oil guys down and they were big including the star of david

stock as well as mike worth, who is not speaking to me even though he is on aaron crushed me. they talked to me about oil. and what was the president doing? i'm not sure, how did we get here? >> because i made a comment about joe. >> i am saying they are out of touch. >> their meeting with windmill companies. >> there's nothing wrong with windmill companies. >> he met with don quixote and i am meeting with j.p. morgan. rockefeller comes in -- >> you are anti-climate change. you are not green, what's the opposite of green, is that brown ? >> i have never defended coal. i don't like wind. wind hurts birds, okay and the

whales don't like wind. he put the wind in nantucket, the whales -- by the way, do you remember wistar track to save the whales? >> i do. and that was the greatest villain ever. >> that was correct, rapado montauban, we can't forget. >> speaking of birds, twitter fires back saying the attempt to fall back with the agreement not terminated. the commitment letter remains in effect and it says that mr. muscat and other parties it must remain in their obligations. >> is this about the financing? >> yes.

>> i have set a potential weak link, although it is not, that that financing could get pulle . they would have to have a valid reason. >> of morgan stanley leads the financing and it's been syndicated and i went through all of the pricing. when they fund, they will probably lose some money given the change in rates. it has 30 million in debt with 33+ billion dollars in equity in front of it. it's hard to be arguing that they would do it with a credit risk. then it goes back to the idea that elon musk has raised. is twitter committing fraud doing one thing they know is wrong? >> why would they say that? >> they have been sticking with the 5% number, but that's where you will have to go in court to

prove a key part of his reason for claiming a breach. by the way, we may get a complaint which is the lawsuit in delaware we have been waiting for. >> is he going to use his own numbers? >> is going to have to prove it in some fashion. >> i don't think he has his own numbers. i think he is using the twitter numbers and that is going to defeat him. can i give you a scenario of what i think will happen. >> we went through a lot of scenarios yesterday. >> and the chancellery says , listen, you knucklehead, you agreed to this price. you can figure out what price you are really going to pay or contempt. see me in my chambers. >> you've got to get to them and twitter is presenting a strong case that says this

contract is valid and nothing he says in any way approximates a breach. there has been no material adverse effect whatsoever and therefore, the judge, in this case ould agree and say you've got to buy the company, what's the point you are making? is it possible the twitter board says, find, you want five dollars off because you have buyers remorse which you have basically had since day 4? >> do you think there is actually going to be a trial in chambers? >> no, let's read the complaint and see what twitter says. let's see if they have done a good job here. second, the delaware court needs to get on this fast and not wait months and months. >> twitter is being harassed. >> yes.

>> having been in many lawsuits in my time, unfortunately, many of them start like this, in my chambers. >> i thought i was going to get to testify. >> the judge wanted to get you out of there. >> is this like my cousin vinn ? >> i've done very well in court, very well. usually when they are in chambers, believe me , they will say we will be on the steps and mr. kramer has valid points. i've got to tell you that mr. taylor has valid points. >> is etched chairman of the board? >> is he consumed by this? >> i don't know. >> he did go to harvard law school, so there you go. still to come this morning, we have details after the brea

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it has been a while since we have heard those strange tones. in the news this morning that bill is out of the game.

he has a new idea, so to speak. remember the $4 million when everything was going gangbusters , so they say. to be fair, they had very favorable terms for investors and more favorable than the ones we were criticizing with the asymmetry between the sponsor and their ability to make money versus the shareholder. given the size of the huge deal that he tried to do with universal music, buying 10%. the scc said the structure does not work for that and the deal unraveled. he ended up buying the state in his funds and now, a year late , or whatever it has been, he is likely won't find anything. his language is a high quality durable company will wait until

market conditions are more favorable. that limits the high-quality deals >> he is giving $4 billion bac , no harm, no foul. take a look at the indexes. the 50 biggest just price and are not doing anything and they are trading above par. then there are those who announced the deal and have not closed it and that is not the same at $.83 on the dollar. which is why it is so hard to do anything these days. oh, my, $.37. >> and 37% of your money after

they have announced and closed the deal. showing a lot of these deals have not been well received. >> and a promoter and take some money out. >> there is a lot of firepower on the sidelines that cannot be employed because there just is not a lot of companies. they are just sitting on it thinking something is going to happen. maybe they can move into oil or gas or aircraft parts. do you know what i'm thinking about? plastics. these people are the guts of these promoters. >> there was a money russian you had to get in on it.

>> who allowed it? >> the investors allowed his and also the gatekeepers. >> there was too much money sloshing around. >> there was a lot of money. >> a lot of money and a lot of speculation. >> i think it is honorable. by the way, we will see more of this. >> sponsors may not want to admit at this point about why you keep going as long as you can even if your spac is down to $.39 on a dollar or $.37. >> maybe we will talk and count down to the opening bell. we work our way toward delta tomorrow in the banks by the end of the week. nasdaq is gaining and we will buying your first car.

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big morning of news with the nasdaq futures in green and the deepest inversion since about 2007. and the 10 year note auction with the opening bell in about five minutes.

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all right 10 minutes before we get started here with trading . >> and the ceo after missing numbers in 2021. that's it. she was gone and that only been there since march of 2020. there is a sense, and this is

stick a fork in the situation. i have to tell you that there are people all the way down who recommended this stuff. >> there is the incredible 2020 price. it looks like a service company. >> yes, it does with a similar look. >> i remember mickey drexler to talk to me about being a merchant and figuring out what people actually want to buy. >> i love this, the guidance was so low and the fundamentalist fundamentals were deteriorating and this is wells fargo. >> and the really screwed up old navy with the whole idea of different sizes for everybody. >> i do want to clear up

something. you were attacked endlessly. >> we will talk about it later. >> someone could be held in contempt. >> yes, yes, yes. that is true. let's get to the opening bell. and as i was saying with bob seger, fortune focusing on cardio and renal diseases. here at the open, with currency of 20+ percent in a year. >> is going to kill all of them. pepsico got away with saying they could have done 10 and

they did eight. i think with the software companies, people are squeezed. >> people being investors? >> the investors, the robots. >> and what you've been talking about has not been reported. >> i have to tell you when i was in the metaverse, i don't know we we have pictures of that with mark zuckerberg, i had a sense this would be for real. that it was going to work. >> there you are. >> that's you? >> yeah, it is. there, do you see? no one understands how cool it is. i'm saying your avatar is

you. >> your movement looks so natural. [ laughter ]. >> it really is natural and it looks like so much fun. who wouldn't want to be with mark zuckerberg? >> there you go to the moon. >> i am stunned, i am stunned. >> let's try to have a high five. >> so, do you think he is a clown? >> we are having a good time, here and the stock is up today. i was talking about the fact that you were talking about they would spend less and lay people off. >> they are the worst performers. >> knob everybody is great

there and they were on a hiring spree where if you walk by the headquarters, by the way, i have, which is difficult because there's the interstate, but if you go across the interstate, you've got a job. >> and do you see? >> a big deal with 4500 for walmart. >> that is a winner. >> actually a lot of news with ev with new leadership transition. >> and jim farley sold so he could build up the ev section afford. i have no trouble with internal combustion engines which is what you are getting.

>> i'm a great the spoiler. >> you are a great to spoiler of the planet, that's true. my point is that if electricity cars do what they do in europe, are you that much ahead on and ev, given the cost of electricity? >> look at what is happening in texas this week. >> not from a consumer balance sheet. our grid would in no way be able to handle that. >> and now back to the discussion with the transition and you have been critical of the administration with the fact they have not opened a serious dialogue with the oil companies. >> it is easy for them to talk to saudi arabia. >> i couldn't talk about the current quarter, but he spoke, in general that other than the

dollar that things are pretty good. service, now, is being killed and somehow that interview is interpreted as being negative. i refer to this as a zeitgeist. >> he said europe is hopping and people freak out. they figure out that service now has too much stock in may sell europe. >> he talked about what q2 earnings will be. it is a quarter where you watch out for the other guy. generally the cycle is not strong but people need to reinvent automation and hybrid work and so forth. >> that is what mazo did, the company that makes the robot

should. whatever jobs are the jobs that people don't want to do like repetitive jobs, they bring them in and that's technology. how much is it down? >> it is up. >> i know, but nobody seems to talk about it. >> you do. >> i know that i do. that's because i talk. >> are you looking for something from janssen? >> yeah, and i didn't get it. >> and we are going to look at the pc which is in declining years. >> okay, so we know from costco yesterday and from hp and from advanced my grow and we know from intel that everybody bought a lot of pcs for work

from home. that happens, you don't buy them every year and then by again, unless there is a new chip, and there isn't. >> apple has a relatively new chip that powers their laptops and makes them faster. >> so maybe apple, but everyone says apple hardware is bad. >> they are not doing well which implies new production. >> i put shoelaces on and a lot of that is kept from investors. that was a positive note on apple bucking the trend. kind of like the class 5 rapid. >> apple is still down less than the market. >> apple never went up like it did.

>> unless it hit the trillion dollar market value. >> it didn't double and double like a lot of companies. what you think of the netflix commentary? >> on the advertising? >> on how poorly they are doing. people don't like netflix. i think writing up the hill, wasn't that good? >> and kate bush is made almost $3 million from that song. >> it wasn't just the song, everyone went back to her catalog. it shows the power of a show on netflix but they are pursuing the ads slowly and looking for leadership there. thank you for setting that up. >> did you like that? >> i did. >> and we have paramount plus which has been doing well and

we will talk about top gun maverick. >> you do think it will be a promotion? >> there tend to be soliloquies that go on and he is positive about the prospects. but i do enjoy having bob on. i wish it was in person because i would like to ask a question. that's what we did in the metaverse. >> he is in california and that's the point. >> so you never actually touch anything? >> that's why i think it will be big. you feel like you are in the room, you do. >> i want to know right now, have the downgraded analysts, of which there is a myriad, played in the metaverse with their children? i bet not one

has even tried it. if they did, they would know this is the way to communicate. you think my kids want to come and see me? but would they get in the metaverse with me? >> they try to touch you in the metaverse and high-five you and that's better? >> i see your point with aging parents and the elderly and keeping them engaged with society. >> i was just saying if my dad was in the metaverse, we would watch the phillies lose last night to the cards and talk about it. >> you can watch them beat atlanta. >> that's not the point of the story, do you really want to go negative? >> is that the original? >> this piece him kolls basically says that kolls is

falling apart. obviously it was for sale and they did not get it . there are companies with buyer's remorse pulling away before they have to go to the chancellery. >> and the markets now are difficult. that's something we never talk about with the emerging markets, hardly ever. >> we could focus a lot more on them. there was once a newsletter in 1992. >> you were so interesting the . >> yes, i traveled the world. >> let's get back to what we were talking about. the markets are difficult and you will get anything done in high yield that isn't already marketed. the new stuff, right now, it is

slow from what i'm hearing. >> how much of that is antitrust? >> no, this is secondary prices for high yield. there are headwinds from regulatory concerns this evening. >> he has brought case after case after case and no one is paying attention. like with goldman sachs and jet blue. that was a cheap shot. >> i know. >> and goldman hired a new guy. >> they put up spirit in frontier and they keep trying. >> and look who goldman hired from google. >> who. >> i've been talking about it all morning. >> i think is going to be amazing. >> what are they doing? >> making money. >> you're not going to explain

it? >> he is a trend guy. >> innovation? >> yeah. >> and with units and subunits in working with regulators? >> there is a strategy for those of us who have been ther . that could be a metaverse and they could do everything in the metaverse. did you know that mark zuckerberg doesn't want to use and actual avatar that looks like you. >> why would you when you can look better than you look in real life, that is the point of the metaverse. >> he doesn't want it hyperrealistic? >> that's what he is saying. >> you don't have to be yourself and you can look better and we know where this is going. >> i could pick the name beethoven, why would i say jimmy

? when i go to wendy's, i'm beethoven. >> and twitter with a gain this morning and we are waiting for the complete from twitter. it will be great reading, let's hope they did a great job at walk tell writing this up. >> >> you did reference at the closing bell because of the conversation. if, if, if musk loses in court and if they get specific performance and if the judge says i won't do it, what

will happen? there was a case in 2012 in delaware where the judge says that you are in contempt. >> it works for me. by the way, american express is down. >> there was context with the conversation that we have had. >> and i think david is more aggressive than elon musk. >> and people don't listen and don't understand. i got it for one day and kind of ignored it. >> immediately i got how to use a zucchini from my viewers. no, but can i go back to the market for a second? >> oh, my god, would you, please . >> and notes you referenced

apple and bank of america on returns versus the negative pieces on apple. the market wants to go higher and apple is and example with j.p. morgan. >> yes, crude is below 100 and the the airlines, by the way, three or four airlines are leading the s&p and boeing is leading the dow. >> i think the market is -- i said to david that july 13th would be the bottom. >> is that today or tomorrow? >> tomorrow. >> so we have a nice upside move on the open. let's get to bob. >> not only boeing but the dow industrial. a lot of people betting on a fourth quarter balance intech and discretionary is also doing better. there are two obvious

trends happening. one is the continuous slide in commodities stocks. you want to watch energy and metals and mining. the big mining stocks are continuing to slide which is notable. again 2% to 4% declines. hedge was $130 at the beginning of june. 100 30 a month ago and now 92? we are talking a 30% decline in a matter of weeks. conocophillips is the same story . there is pessimism amongst the analysts. i don't call it so much pessimism is getting real and there is down grads ahead of earnings season. at wells fargo, the ceo resigned. and a new low for jet blue at

eight dollars. and union pacific downgraded and menards is downgraded. the gap because of the resignation of the ceo. the point is that being discreet is finally starting to catch up where analysts are catching up with wall street for a while in terms of wall street. the commodity breakdown is breathtaking, though. remember these were the big darlings at the first of the year with commodities and energy stocks. now take a look at what is happening with energy stocks. halliburton with five weeks and conocophillips that were at new highs in april or so. the medal stocks have collapsed as well even more than some of the energy stocks. the commodities themselves are also weaker. there is a base metals

index which is of basket of base metals stocks. straight down and this is aluminum and copper and zinc futures which is indicative of the overall futures market. commodities are soft plus oil. same situation in 6-8 wheats for lumber, crude and corn. for the most part, march and april, they have been steadily down. in conemaugh commodities we've gone from a bull market to a bear market in essentially five or six weeks. this is the problem and you can change quickly on a dime in the market. we are seeing that with stocks as well. back to you. >> as we go to break, yield on the decline given the macro indicators. you have the 10 year today with

the front end back below 3. we will be right back.

one thing we didn't get to this morning was the news from citron yesterday a very bearish take. with a year-to-date decline of almost 60% w hanging on to smiled gains don't go anywhere.

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time for jim and stop trading. >> i was talking about the gloomy retail sales in san francisco. there are guards added trying to top any shoplifting. walgreens closing all around where we were in san francisco well, today starbucks permanently closing stores in seattle, los angeles, two in portland, a single in philadelphia, washington, because the employees are not safe i just think we have to start recognizing that there is a -- an onslaw. the retailers are in trouble the people behind the counter are being asked to enforce

rules. they can't get rid of someone taking drugs that's not their job so i think howard shultz doing the right thing, and closing stores this will be a common theme, because retail is overrun by pilferage and by dangerous people i don't mean to be politically incorrect, but dangerous people. >> he's having to rethink the place where you used to go -- >> i was at one where i was threatened i'm just buying a cup of coffee. >> jim, we will see you tonight. "mad money", 6:00 p.m. >> metaverse is real watch this with david. >> beautiful, the technology, incredible see you at 6:00. enwh we come back, bob bakish, top gun and more

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nothing keeps it all together quite like - gold. visit invest.gold to see how gold is everyone's asset. good tuesday morning welcome to another hour of "squawk on the street. i'm carl quintanilla with sara eisen and david faber. we have some earnings season

coming in early. >> we are 30 minutes into the trading session. here are three big movers we are watching right now starting with twitter, the company sending a letter to elon musk saying it's not reached any of his obligations and his effort to back our deal is, quote, invalid and wrongful form the stock is actually up 3%. it lotion more than 7% yesterday. and we'll end with amazon, which kicks off the two-day shopping event eight years ago, the company said it was meant to mark an versery, but it continued every year walmart isn't participating, i guess.

it doesn't seem so big maybe because it's it's been going on so long we've been up and down renewed his parity for the first time, business sentiment,est terr george warning that i'm certainly sympathetic, but policy changes transmit to the choice with a lag, and significant and bankrupt changes can be unsettling to households and businesses bostic and bull heart are saying more significant hikes are ahead. david koston, always a pleasure to have you. d.k., welcome back >> in general, given your targets and jan hatzius' view -- >> i think you want it trading in a range of 3700 to 3900

this is basically because the extent that equity prices rise and valuations increase, that would be tan machined to licenings financial conditions as a result you accepted that -- that's sort of more of a concern from a prospective forward return, and we went to the lower end, it's more attractive. you think about the risk to the down side would put the overall index, perhaps a 3150 to the extent it would look at a recession in 2023, but as you indicate, sort of the increase in probability of that >> that was 225 times 14, right? was it a 14 multiple. >> we think the idea of the market was basically derated, to around 16 times possibly now to the extent you have a recessionary scenario, you can

see the multiple go down slightly the idea of earnings prospect would also be degrading. >> is it your view, the house view that tomorrow's cpi will be -- albeit hot, be the last? >> as a result that would lead, you know, the idea of the fed continues to hike 75 basis points basically in july and have another 50 basis points in september, two 25 basis-point increases toward the end of the year. >> are they -- >> you can really see that in the companies selling abroad and how much headwind in terms of their performance. there's been a huge gap, almost ten percentage points difference in return, the export oriented companies down the ones more domestically facing, down 10% to 12%, which i

think is a significant indication that the equity market has reflected the idea of a really strong dollar. >> so would you be a buyer on any bad news around currencies, for instance >> a lot of companies do get a pass sometimes when they report pepsi had a 2% hit a sales and on profits because of the strong dollar the stock went up. >> and they reiterated their -- they have dividends up 10% this year, at least in the model we have and the idea of business both report returns as well as constant earnings, in sort of nominal terms. the takeaway is this was actually quite strong. the concern that so many businesses have heading into the second quarter, with earnings kicking off a friday, you have

expectations 6% year over year growth, still relatively modest. so companies were able to manage through the haas chats because, the idea that the economy is slowing, highly unlikely that's going to happen. you have big margin pressures, commodity prices, the dollar, all headwinds for a lot of companies. health care has been really rallying staples have done relatively well >> healthcare has been a big area it's been extremely low, depressed for a while. and pretty optimistic on the

part of many ceos, obviously, my takeaway, so healthcare would certainly be one area. the get margin degradation, they are more vulnerable to some of these pressures. the idea of consumer staples and health care -- firms that said, you do have this list of tactical ideas, where you have up side, a lot consensus estimates, mattel, data dog, crowdstrike, is there a threat >> one of the ways to think about this is you look at calendar year 2023, earnings estimates, cut those by 20%. that's historic at concerned of experience in terms of buys stocks, and to the extent the companies are reasonably

attractive value i think is an important way to do it analysts have been creating scenarios where there's a recession in the model, it may not be a -- but increased likelihood that may be the case. >> there is more of a theme there, ralph, vf -- >> the consumer. >> yeah. >> it's a more challenging position >> with oil down, back to 97, almost taking out the ukraine premium. >> the expectations by my colleagues in commodities research is oil prices will go up a lot the idea is there's a significant imbalance in terms of the demand, and the supply issues there energy prices would like le -- i

think that's likely to be embedded. >> we'll have to talk earnings season ex energy thanks for setting us up it's going to get busy. we mentioned it, but wanted to zero in on pepsico shares down more than 5% or so over the last month 13% organic revenue growth, the expectation was 10 they raised that i revenue forecast for the year. i did talk to hugh johnston, the cfo and vice chair the key on the consumer, he said, is that relatively low

elasticity, means that consumer companies had been raising prices, whether it was shrinking packages or fewer bulk pack packaging, i said, is there anything that would indicate a recessionary trend and he said, not really. he said from the stock perspective, he said their stock is about recession-proof as about anybody, but if you think about convenience stores, for instance, you may see less growth because oil prices are so high but, no, high single groud in grocery stores people are still going out to eat. i asked him to interpret that. he said, well, maybe people are cutting back on more durable goods, but they still are -- and this is of course coming from the cfo of a snacking giant --

spending on their little treats. but inflation is tough >> growth retch is high, 10% i don't hoe how to put that in perspective for us >> they turned it up in the last few quarters or so remember during covid they were seeing those kinds of levels and then they've been able to keep it going. snack sergeant a very strong category this result goes well. both heavy in the snacking business, but gatorade, for instance, it's been a hot summer, they've had some interesting innovations. so overall the company is executing very well. >> when you can afford nominal terms, it makes sense. >> hugh johnston was more in the

we'll see, we have to see what the consumer does. they're on guard, of course, for a change even in europe, the weakness in the volume was tied to -- >> and also keeping the prices the same in europo, sometimes there's -- >> he pushed back on that. >> consumer-rent rick packaging. they do that they they all do that? it's a sort of better -- >> mondoleze keeps making mire cookie smaller and smaller. >> what cookies do you eat >> malomars, the taste they completely ruined. they're different. >> it's not nestle. >> that's mondoleze. >> they would say they left it

alone. >> i don't believe that. >> you're on a tear. you're just taking down everyone. >> i'm coming to an end. it's all over now. next, housing, home buyers cancelling deals at the highest rate since the start of the pandemic. >> plus it's been a tough year for those focus odd direct to consumer bob bakish will tell us why things look good. and top states for business is back. we'll take you leave to this year's winner in this hour don't go anywhere. [ kimberly ] before clearchoice, my dental health was so bad i would be in a lot of pain.

i was unable to eat. it was very hard. kimberly came to clearchoice with a bunch of missing teeth, struggling with pain, with dental disease. clearchoice dental implants solved her dental issues. [ kimberly ] i feel so much better. i feel energized to go outside and play with my daughter. i can ate anything. like, i don't have to worry. clearchoice changed my life.

shares of streaming names, as we like to call them, many have been crushed this year, concerns about slowing subscriber cost. paramount fari plus is faring t best as i said, you guys have done well in certainly a more challenging environment. i wonder if you have any changing views you may share with our viewers in terms of the economics of direct to consumer now, if that's changing, if

you're seeing the patterns evolve in this business? >> david, great to see you on the streaming topic, i would say three things i would start by reminding people, the total market, or tam as people referred to it, is very large, continues to grow. our positioning of offering the ranges of free services plus lou-priced subscription services with ads second thing, we have real momentum. paramount plus is working well for us if you just look at third-party antenna data on the domestic view, so not our data, you will find that since we launched paramount plus, we have the highest chair in the industry, signups, gross ads, net ads,

that's also true six of the last seven months the third thing i would say, we had a different model here it's very powerful, and that's the combination of streaming with theatrical and linear television it reduces or cost, because we're sharing, feature films, and then to paramount plus and it also gives us tremendous access to the platforms for promotional reasons and others look, there's a lot of talk, but we very much like what we see in streaming and believe there's a huge opportunity for this company in particular. >> yeah, you know, i do wonder, now that you've had experience in terms of content what works, what doesn't, a, you have the nfl on there

i signed up for paramount plus in part because i wanted to watch games on cbs did you see any churn after the season >> the reality is that broad content offering, which was our thesis going in, is working exceptionally well so you highlighted the nfl it definitely works, but nfl viewers don't only watch the nfl. so believe it or not, they also watch a lot of reality we're one of the leaders of reality in the industry. right now, for example, we have the challenge on broadcast tv on cbs, "survivor," et cetera we also have tremendous kids

progr programming. then there's all the scripted dramas like "1883" the cbs shows have tremendous audience one of the byproducts of that is not only subscriber growth, but children consistently has come down every month >> there's not reduction in retrans, but it's reflective of the quality of cbs it's the number one broadcast network in the u.s. for 14 years running. it has things like the nfl, live events like the grammys, and those are highly valuable. in fact, we have consistently extended or relationships with

distributors, both, as well as on the station affiliate side the we have a great product. you can't get product like this elsewhere. >> 2021 content investment was about $15 billion. i don't think you shared a number for this year, though you said it will continue to grow. i wonder, when it comes to content, particularly scripted content, given netflix's stumbles, is it possible costs will come down >> we'll have to see we have a long-range plan this is on sound fiscal practice, we

like the trajectory of that. it's possible that some people moderate what they're doing on the content spending side, will benefit. over the last couple years -- >> but do you expect there will be some moderation, bob, at all, from the likes of netflix. >> there's talk of that, but i'm not focussing on that. we've bringing great entertainment to consumers. >> i want to move past this to the ad market, recession fears typically, you know, a lot of companies pull back, one of the things they pull back on ad spending and marketing are you seeing anything? >> two things about the ad market the scattered market has been choppy, certainly suffered from lack of visibility, but that

said we're happy with what we're seeing in category like studios, travel, and more recent ly farmen, so the second thing is we just wrapped what's known as the up front in media game that's when advertisers make commitments for the next year two notable things happened. one, potential got the same price increases, rate of change we call it, for broadcast and cable. that doesn't happen historically that speaks to the quality of cable and our approach the second thing is our digital volume was up materially again, speaking of quality of product, as well as the fact

that we are packing in solutions for advertisers, which span linear television and digital. that's what you need in this marketplace to ensure a high-quality reach as big a hit as top gun maverick it is, it won't translate into big money for you guys so that even though you're the distributor, you're not going to see a great deal of profit can you offer us any guidance on that >> "top gun maverick" was the fifth number one we had at the box office this year there were four before that. those were all our films, and

they performed above expectations "top gun maverick" that film will be the biggest domestic movie for paraimmunity of all time it will pass "titanic" probably this week. it is true there was co-financing, it is not true that skydance is a majority or anything like that, but they have a piece of it, obviously. we are making nice money on it, put more importantly it's part of our library we have access to an incredible slate of films, and it will be an incredible magnet. >> though we don't know yet when it will come to paramount plus. >> we have not announced that.

because of what it's doing at the box office, it will be a big longer, but don't worry. >> is tom cruise going to make like $200 million? >> i'm not going to get into anything like that. >> anywhere near that? you're not going to tell me? >> he's going dodd just fine by the way, he's one of the best actors of our day. he put an incredible film together >> we love him finally, bob, a 4% yield on your stock. why do you pay a dividend? why not use that cash for something else >> there's a range of investors out there. there are invest ares who are

part a shareholder return, and we certainly have -- that likes -- so it's part of a balance return, as we sumly are upgrading value. >> bob, always a pleasure to have you stop by thank you. >> thanks, david stay well. >> ether is dropping as well not quite to the je lun30aw of 18,5, but we'll watch that we're back in a moment

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consumer confidence in the housing market is still pretty awful, but a growing number of people think it's a good time to buy. diana? >> confidence in housing has definitely shifted both quickly and dramatically thanks to the sharp jump in mortgage interest rates. the share of homeowners who think is a good time to sell fell, just 20% of consumer think it's a good time to buy, though that's slightly improved from play the biggest issue may be more

people are concerned they would lose their jobs right now, and that hit a survey high of 82%. that may also be why more potential buyers are cancelling their contracts. that's the highest share since the first months of the pandemic when home buying paused immediately, though quite briefly. buyers are cancelling for several reasons. some are afraid prices will fall in the coming year and they'll lose money others are not qualifying for the loans at the higher rates. still others may think if the market cools a bit, they could get a better house at a better rate part of the reason why jpmorgan downgraded lennar, saying they remain cautious and less constructive on the sector, as fundamentals have only just

begun to soften. the june jobs report showed a slowdown in hiring. >> a lot of the downgrades reflecting a lot of that let's get a news update. hey, bertha. >> good morning, carl. a family funeral was held at a temple days after japan's former permit shinzo abe was assassinated hundreds of people filled the squawks outside the temple and downtown tokyo to say their final good-byes. abe was the longest-served, and remain for health reasons. the house january 6th committee will focus today on what it says are clear ties between allies of former president donald trump and the extremists groups. today's hearing is scheduled to begin at 1:00 p.m. eastern a space exstarship test ended in a fiery explosion at the b

boca chi coua facility the fire on the launchpad was extinguished no injuries were reported. whoa is right. back to you, carl. after the break, don't miss an exclusive with mark shaffer, talking about the latest in deal making, including the battle between elatwitter and elon mus. 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.

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the slowdown was driven by, well, pick your poison

joining me now to discuss this and what we can expect going forward, mark schafer. once a quarter, sometimes we miss a quarter with us are you surprised at how strong things were, given -- that wasn't all the things we can cite >> the first half, you strict out the spac business, that is 60% down from what we call traditional m&a. driven in large by tech and industrial, and the megadeal, 10 billion and up that's off the greater year in m&a history, which was 2021. >> 2021. so you look at valuations held,

premiums are up. and people ask why why was it so good se secondly disruption has not gone amp, and thirdly, esg has been a big driver. >> what do you mean when you say that >> companies are working hard, particularly in the energy sector, to reepps portfolios to get to carbon neutral, carbon neutrality, this stuff the real question is what happens now? >> of course i've been asked that question. in a mark like this with volatility, it's different to negotiate a price. ceo confidence always plays a role are things starting to trend poorly for your outlook in the

second half? >> this is probably the most complex and uncertainly environment. the uncertainly factors are very real will in be a precipitous decline? the cliff edge at one point will it be more mod rule declines? >> are there still talks going on in? it's a decent sign. >> the conversations are still going on i think you have to look at it, can you solve the problems with just organic-type solutions? i don't believe that one of the issues we have had going forward, the finance market backed up, there's $100 billion of commitments that have to get through the system. like the p.e. being that's 40%

of the market in the first half, you expect a decline. >> let's stop there for a minute and stay on that i've been reporting the high-yield market is shuttered new stuff, is it tough >> we know rates are going up. central banks have to do what they're going to do, so the question is, what ultimately happens? i think the volumes will be lower. i don't think it will be a precipitous decline, unless you get a shock. i don't believe we're recession-proof, but we're still transacting at this point. we'll have to see. >> we've talked about a lot of regulatory headwinds a lot of jawboning, but is it a gating issue

>> it's very real. the perception is you have to be very cognizant of what's going on you know, query with the supreme court decision around the epa, whether the ability to make -- i don't know the answer, i'm not an antitrust expert, but very top of mind in boardrooms. can i get the deal closed? >> give me a broader perspective on twitter it's not unimportant, though a $4 billion deal, the guy has buyer's remorse. what do you make of it >> we're not involved. it's now in litigation i think you guys have covered it very, very well. the question will be, when is a deal a deal? when is it not a deal? we've always taken the position

that once you sign an agreement, the expectation is high. will the courts decide to change things and make it easier for for people to pull out of deals? >> to your point, if the court were to allow that, if you were not to prove in some way that you proved fraud, but it could change the business. >> no do you. stronger other weaker second half >> i think it will be weaker i think particularly the question is fed hikes, central banks, are we looking at recession? can we get inflation under control? i don't know these things. my own instinct is, i think it could be tougher

the strategic bid is still real, how long does that stay? i actually do think that volumes will decline >> got it. i never look back at the tape to hold you accountable i may do that for our next interview. [ laughter ] >> good to see you. >> thank you, dave. check out some of the biggest laggards on the s&p. service servicenow will lead you on the down side. we're back in the. re only at vanguard you're more than just an investor

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take charge of your health care today. consider adding this. call unitedhealthcare today about an aarp medicare supplement plan. cnbc's top states for business is back that big reveal of which state came in first coming up tomorrow

first, our scott cohn joins us with a look at how we rates the states scott, good morning. >> good morning, sara. they tell me this spot is the best spot in the top state for birdwatching let's see. hmm, i would tell what you i just saw, but then you would know what the top state is we can't let that go just yet. we've been doing this study since 2007 our formula we adopted back then is built for change, which is good, because so much is changing, but it also lets us hold the states to our consistent set of standards. here's how it works. we start by analyzing every state's economic development picture. the more they mention a particular selling point, the more weight it carries in our study. this year pretty much every state is touting its workforce, no great surprise. this year workforce carries the most weight.

we look at how well educated the workforce is, and next, infrastructure, development sites, roads, bridges, power grid and sustainability. the cost of doing business, increasingly important because of inflation, the economy. life, health and includes, including crime, the environmental and new this year, child care technology and innovation. business friendliness, access to capital and the cost of living we're also paying special attention this year to a couple emerging industries, cryptocurrency and cannabis. you can read more about our methodology at t topstates.cnbc.com and you'll see where i'll unveil one more diabolical hint -- no

right turn no right turn. the hints are diabolical carl >> the hints are diabolical. any thoughts, david? >> i don't >> ask the "jeopardy" champ. >> no right turn on red, that's in new york. >> scott, your poker face is legendary. thanks a big show on "techcheck" today, including morgan stanley's adam jonas we'll talk all things tesla, and how musk's battle between twitter may affect that. etsy's stock is down as well

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later on "closing bell," we have an interview with money waters research founder carson

block who just minutes ago revealed a new short idea. armstrong sustainable capital. a financing company that is a big esg player he calls the accounting misleading and complex we'll talk to him about it get the company's response 3:00 p.m. eastern time the stock is moving down 7.6% on that news. will we'll be right back here squawk on the street sional pit . go, go, go. sorry. nope. okay. fresh donuts - hot coffee! they deliver real time data and business forecasts when you need it. i think it was fine how it was. (air tool sound) to help you stay ahead of the curve... or you could use workday. the finance, hr and planning system that helps cfos make better decisions faster. on the other hand, we had a great fourth quarter. for a accelerate your decision-making world. workday. for a changing world.

a recent poll out of morning consult finding that more than eight in ten people plan to cut back on dining out right now to counter that, some restaurants are trying to offer inflation relief by lowering menu prices joining us now is one of them, robert earl, founder and chairman of planet hollywood and earl enterprises you own a number hotels and restaurants, robert. first off, what you are seeing from the consume we are the high inflation readings >> the hospitality industry is going to go through some major problems the impact of tech and covid is here to stay there's been some lifestyle changes that are changing our workforce. ironically, the culinary are

coming back in the kitchen but the young kids that used to work at the fronts of house are finding alternatives and we need as an industry and government support to getting to some new training that side is very worrying and the supply chain side is a disaster i'm afraid i'm going to report to you that we're going to have a very, very scary thanksgiving. my turkey price has gone up 133% from our suppliers just from last year. and the impact on the consumer both the scarcity of the turkey because there have been some bad flu variants that affected the supply chain and just general pricing, i don't know what's going to happen. so there's a lot of worrying signs. people are still going out

total sales are up but a lot more people got used during covid deliveries and a lot more people drive through so that they had no physical contact. so it's just a really changing industry at this moment. >> no, you have given us a good overview some of the highlights of the risks that we don't hear from the public companies that's refreshing. what you are doing about the inflation problem? as i understand it, you're trying to push back and keep prices low >> well, we're having a bit of fun and we're just trying to get people out and another interesting fact is geographically, different communities have come out and been more chancy about their lives getting back to normal than others. massachusetts has been interestingly very safe and quite slow the older market coming out we have a 40-year-old wonderful

pizza pasta chain that we own and so this week, great plug, and last week, i reverted on the famous items to 40-year-old prices not much of a difference 40 years ago, pizza was $5.25. turn the clock 40 years, it's $15 to $16 so in our pizza parlors, this wednesday and thursday in all of new england, all of massachusetts, the 60 plus restaurants you can get those old prices and we literally had lines out doort last week. people spend money it reminds them to come back and i urge all of our industry to try fun things like that. because it just encourages you to go out. >> all right i can't -- robert, it's david. the you're very negative in some ways and then you promotional and tell me things are going to

be better. i don't know are we going to -- are we going to be in that same spot next year or are things going to get worse? >> david, you're always -- you are always great things. i think i'm negative on the entire industry because of the labor force and the supply chain. i'm highlighting that one can be creative and for your own chain you can perhaps get above things but at the moment if you don't own an oil well, david, i recommend you go in the print industry you will not believe the price of paper now the paper goods, the bags. it's incredible. some of it is increased costs that the manufacturer rightly passes on. but i question it's a lot more profit somewhat like you suggested on some of your shows with oil >> yeah. understood >> so i can't be totally -- i can't be totally positive.

everyone is going to continue to eat. and i also built a large business, as you know, in what we call virtual brands >> robert, unfortunately, we're out of time. we always love to have you and we're going to bring you back soon. thank you. that's going to do it for us on "squawk on the street. thank you. thank you, sarah good tuesday morning welcome to "tech check." today inflation's impact on tech what to expect from cpi tomorrow last month the nasdaq falling more than 8% in the two days following that release this morning the nasdaq down slightly but cloud and enterprise tech getting hit much harder beneath the surface. plus, the effect on tesla from musk's twitter war we'll talk to morgue an stanley's adam jonas about tesla and apple. then move to exit. that is meta's message to