we have other places to go to make money. >> that was very detailed. i don't recommend you continue to do that. you have to learn how to say things without saying anything. you gave us some good stuff to think about. we will see how it plays out. thank you. >> you are welcome. >> andrew? >> take a quick five. we moved on a lot this morning. dio w, often points. nasdaq, looking up. we will hand it over to our friends on the squawk box. make sure you join us tomorrow. good wednesday morning. welcome to squawk box on the street. another morning of a pretty tight market range. the numbers of consumers have fairly weak guidance. more big names after the bell. the road map begins with

searching for direction. they are coming off of three days of losses. we have the housing recession risks. we have homes prices. retails and consumer snapshots, it's the best. going of sharp on a new financial investment. how do we feel about them going down? >> we are going to go into it with focus. yesterday at the wharton club of minnesota, the senator expressed his fear when talking about inflation. >> the big fear i have in the back of my mind, is that the markets are wrong. the inflation is much more embedded at a much higher level. we appreciate. we have to be more aggressive than i anticipated. probably for longer to bring the inflation back down. >> interesting. we keep talking about the focus

on inflation. we talk about consumers very well. >> i listen to that. i don't think it's necessarily true. i think everybody recognizes there's a lot of inflation. it's very difficult to find the one that says inflation is done. there is nothing that is completely obvious. inflation has to come down. why do they have to say when and how many? who does that? think about any other world. i'm going to get to that. it might take a little bit longer. you have contracts. i'm going to get to it. i know how long it's going to be. you shouldn't be worried. i don't know. >> i don't know if it's going to work. >> any serious business person

says that. why do this? why go through this? >> i'm going to call it that. why go through it? >> of course, why torture the economy? i interview us every day. i can't imagine them saying it's bad and we will get to it. >> occasionally, we have someone doing it. you are very critical of their conference calls. >> i say to my wife, let think i have it. >> all of which means what for the fed? >> we don't know. it >> they are telling us that you have artie said that. what we already know in many ways. >> i think they should have said this. we are doing our job. we are getting it done. we can't keep the timeline. period. end of story.

no need, carl, to do this if you are embedded. how about i did this to you? fire burning in your house. could be good, could be bad. maybe we get to it. we are a little jammed. >> they want to make sure that conditions remain tight. there is an element to that. >> it could be terrific. silence is golden. he says, period, we have a tough period. we are going to get the job done. do i want bill belichick? i do. we are on to cincinnati. >> show up in a hoodie, and

mumble. >> very well-dressed. he's poised. >> i like a nice speaking voice. >> how about you do anything? a respected figure. it would be great if they got asked a question, and you can say, next question. >> the high school press conference has to end. >> you are very critical. it >> i am. number 42 question. did you have cornflakes today? >> we are trying to look at bill belichick for the entire press conference. >> that will be great. stay tuned. >> we are staying tuned. >> we have to haul these guys accountable. i happen to like this guy.

their role should be that we support powell and what he does. we will respect the decision. we hope you do a good job. what's the matter with that? i own it. i'm going to do better next time. that's a better answer. >> yesterday, we expect him to reiterate the case for slowing the pace. not many people have made big goals. >> that's exactly what he told us. that's a little bit of a step toward the obvious. >> watch out. don't expect the pivot. >> he has said what he's going to do. he's going to do it. other guys get on board. if you imagine the offensive coach, you let me do this.

>> are you going to bring that up? >> how about them saying they are going to throw wild pitches tonight? i don't know. the braves are really good. i don't know if we can beat them. we are going to try. >> bench it. they don't understand the power of the word. they confuse people. that's how you get these other guys. you have the early business. >> we can talk the brothers if you want. >> i thought we should get away from it now. >> cut the supply chain issues. >> rich people were cutting

numbers. 20,000. they were building scarcity. we go theoretically care, right? too many homes, not enough customers. >> longer-term trend. >> i will tell you what's interesting. when you look at the 920,000. with your cash card, you are saying you are not doing your job. we have to tell people what that is. >> whose new single-family homes are here? it has been cut in half for july. six month change, down 30%. supply of homes, 11 months. how do you think they have done a lot? >> they have done a great job. the brothers are the highest. housing has slowed.

everything that goes into a house has slowed. we said that. that's not the problem. everybody knows you have a demand. i'm talking. >> i can toss it as far as you need. >> i don't want that to happen. i think they are going to small business. that would take away too much. >> why would they be into the call? >> they are going to open six. they have a different guy. you will see 117th street. >> i don't understand that. >> i look at this economy.

they want to make it. they want people to stop spending. they want everybody to be with the alphabet. we have enough employees. you'll have a job. and that's what they want. it's a simile. >> we have the famous ratio. job openings are here for the employment workers. >> it has to go lower. >> they go quickly after the lose a job. workers for example, are going to find it. >> they send that to me. how about that rose? trying to stay up. howard schultz, ready to get the best from that rose.

bluebottle, or whoever you are selling. that rose cannot keep good people. and that's the reason why dutch prose isn't making more money. i think that's the job part of it. they had to find out what level of interest rates are fear mongering. >> would you agree that the effect on toll comes first? the effect on job hopping comes later? it will come. >> that's what they are hoping for. when admission to cash card, he's not granular. this is the way he should say it. i watch them in words from last night. brothers are talking about things. it's also called homework. they were saying that they had a problem. we are getting there, doing the right thing. companies are telling us what's going to happen.

so far, it's going our way. before you think you have to do 7575, companies are feeling the brunt. we are getting there. i love an appointment. >> you have made no secret of the fact that you want to become chair. >> i thought i would get treasury. >> it didn't work. >> do you know what i have for my uppers? >> nothing. >> how about a diet coke? i gave them more money than people that had the betterment of it. >> it's your press conference now. >> do you imagine what the hollywood square would say?

practice? practice. i would give them the iversen. >> one day. is still young. >> i had a really great plan for workers. how about a second diet coke? >> thanks for that. coming up, we have the battle for twitter. we have another wild morning. this partnership between amazon and telethon. this is all when we come back.

we are keeping an eye on twitter. significant decline yesterday based on the noon news that we received. this was from the whistleblower. they alleged a lot of problems at the company. a focus on security more than the number of bots. this has been the focus. elon musk, tries to get out of his deal. he acquired for $54.20 a share. it was important a few days ago. in light of yesterday's apartment, they scheduled a hearing on both sides. they made a lot of requests of twitter, to provide data.

twitter said that they weren't going to give them that. it's confidential. you have even stated on twitter, that if you don't buy us, you might want to launch a competitive service. why put the data out that would help you with that? that was the original point of this. however, you are definitely going to get the motion to beef up that counterclaim. you have a lot of what we had yesterday in the news. we need more time. we want to look into the claims. we want to subpoena certain documents. emails, any other things weekend find. not particularly certain allegations.

it's a different mature side of things. we have a lot more potential. we have long-term liability. possession in the case that it's currently constructed, it's unclear. it's unclear whether he will rule from the bench, and say that your motion is granted. we will give you more time. i will push the date of the trial. we don't know whether she will continue as she has so far to for to twitter in terms of her ruling thus far. an important hearing. he could have the impact of delaying the trial at the very least. opening up new avenues for lawyers. >> i'm working on why he was let go. he didn't fit in. they had one incidence with the

russian. significant headcounts were there. >> peep did this every day. they were doing different things with people in the universe. when you have never had one of these hacks, then you don't know the fortune. i understand that they have to spend it. >> at the very least. we are online reporting by others. we haven't seen it redacted. the whistleblower complaint is there. >> it seems like this company was not particularly well run. we have a different documentary. twitter has been good. >> the original cake. founders put together with three guys. that's the thing.

also, a fractions board they got involved. >> now he has something. how much does he have on the spot? this company has been withholding. we have some funds down the road. >> i should have lied down last night. 29-28. >> he played $28.29. >> who cares? [ laughter ] >> i'm going to step in to buy something.

>> is not like he has something to do with what he's currently got going on. >> this is more than you'll ever know. >> you are so sure of yourself. >> not a 29. maybe it's five. we are going to go with the target of 37. he will countdown to the opening balance. look at the features. we are back after a break. so you can go and see... or taste or do absolutely nothing with all those bubbles. without ever wondering if you're getting the most out of your trip. because you are. how will your business adapt to change? you could hire an office full of peyton mannings.

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what stands out is the

customer statement household income. the customer household income is higher than average. within the range of the customer statements, the lower income customer statements saw significantly more pullback. >> let's get to the mad dash. we are going to stick with nordstrom. we have seen the same scene. lower, but much more grammatical. the sky was pressuring them a great deal. rack was not working. >> it's more the customer base that you were talking about? >> yes. in july, this was a versatile

field. the cage was horrendous. july was really bad. that was devastating. once you go through life support on the lower end, stop. they stop shopping here. nordstrom has some sales. they weren't working. the private label is lower than the name brands read they have a lot of inventory. i don't happen to like them very much. it's fun and a joy to shop for. these people are going to amazon. they don't need it. they're not looking for the enjoyment. they are looking to get it done. this is the big change in america. after the pandemic calmed down, we will have the initial numbers very shocking.

>> yesterday, macy's. >> you can't lay a glove on top of that. >> we have to take a quick eabrk. anytime, anywhere. this is us. opening bell, coming up next

another busy day?

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when you see that, they get rid of that stuff no matter what. brian cornell turned out to be the master. he identified that everything was going to go wrong. he got rid of it.

we have an environment where there are many others for the inventory. that's not good. they did not do a good job. >> revenue, pretty much in line. certainly been around the block. opening bell right here. national black supplier development program. long boards are here. let's watch telethon at the opening. breaking the story for the trip with amazon. if you buy a bike or apparel, barry mccarthy, finding a new school. >> i think mccarthy was done with that model that i got stuck with. we are going to save the company. we are trying to make this mainstream company. no more being alone.

during the week long process for joining the nation. >> you like the process? >> he's very smart. one of the smartest people i have ever met. i don't know if it should be up 11%. it should be trending out. palatine, they are trying to make it work. >> they have a bad back. i'm just saying, for the era of covid, i think mccarthy is coming in with a clean hand. we had some very bloated aspects. when i met fully the first time, it's okay. the second time was bad. he ridiculed me.

sometimes, you just get head. 1445 dollars. >> i can go for the knock around nine. >> that was a price for the wealthy. 22 inch touchscreen. immersive. >> the mirror does better. it was right there with james morgan to create a flight. >> this is beyond that. is this a new bit? maybe they get merchandise. they have the cash to be able to get merchandise. they have to take the charge for all of they have.

>> they didn't notify them in the terms and heading into the holiday season. you have to have money to buy the inventory. >> one time i remember a story being involved in jcpenney. someone broke a story about a giant bond and everyone thought they were saved. i don't remember who that was. >> i remember that. >> everyone thought they were going to make it. they didn't. they said 2% was way too high. target exposure is right here, too fast for walmart. >> you don't think the game theory is sensible?

>> if i was target, i would go through for this commercials. i would say listen, i want all of your inventory. we have holiday seasons. there won't be any actual import left. it's playing hardball. brian cornell, a hard player. >> do you have sailboats? >> on the water. people have houses. it's not a bad area. it's a nice area. maybe not now. >> in the 50s, it was a little

bit better. >> i'm saying that he's scruffy. people don't stand. he doesn't like losing. i was afraid he was going to retire. i swear to god. >> we go in the background. >> when things got bad, he rolled up his sleeves. i love it. i think he's a great merchant, and a great guy. >> i think he's going to crush bed bath and beyond. >> what explains that today? you have long said that the market for the defensive line is recession resistant. they cut all of that. they were closer to $.97 out of the dollar. >> it's a great mystery. thomas edison, on that a little

bit. their conference call basically sets you up. this is the greatest time for pets ever. many people have one that during the pandemic. they got a second pet. i find this extraordinary that the company didn't go better. chewy is getting better. founded by ryan cohen. i was shocked. i'm glad he came on. i think he tried to put a base on something that was not good numbers. >> i'm keeping an eye on the respective market caps. we are following closely for many years. they are not close on all of them. i can do that. one of them is t-mobile. the other one, verizon. t-mobile is down a little bit more than verizon. this is in part because it

certainly seems possible that t- mobile number three player by a long way. this is not looking at the verizon in the market value. far above at&t's market value. warner bros. made the discovery. take a look at the 10 year comparison. i think that is the most telling. we talked day today so often. to get that out of the way. you actually make a bet on management teams. i feel good about something. i don't think a company has got it. the other one does. sometimes, you can do very well. >> you just need to go on t- mobile. will you take a look at that? >> 100%. >> add the dividend. >> this is important.

i don't believe that's inclusive. just comparison. >> look at verizon. straight line for 10 years. >> .46. >> that shows you it has not moved in 10 years. they have captured market share. they have capitalized on the spectrum position. it has begun to not compete with six wireless products. we have parent companies. it has taken market shares. we reported quarter after quarter. we have a key period of a number of years ago. it has become almost the largest wireless company for market caps in the country. worth noting. >> is 10% bigger. i think it's going to pass

verizon. >> the market cap with your girlfriend? >> 10%. >> i want to ask you something. what value is he creating? >> hands. what happened to the money? >> [>> what do you mean? >> i'm not from where you are from. i question how much value is

right here. >> always a competitive market. at&t has become more competitive in many ways. it's overbuilt. >> that's a great way. is that how you describe someone? >> looking at the performance review. >> hands down. he creating a value. one scene that came out of the recent earnings >> they are late on utilities. the worst on crisis actions and

utilities we hope you do for a break in the tuition. i have had that happen to me. i felt the article was harsh. it's all about what you can pay. >> way too harsh for what tippins in. >> this is what we have seen from other walmarts. they have the low end consumers. this was all with pay, in terms of non-collectibles going on. it's all about things of that nature. i is keeping an eye on it. >> >> the average revenue for

users is going to increase. you have the coverage from t mobile. >> they will not be everywhere with the fixed wireless. if you want to get it, you have to go in and tell them. don't tell them where you live, but if you live in the apartment building, which one it is. they need to know whether it's nearby, and whether they have the capacity to fulfill your needs. what is replacing broadband in the home? limited product, but an effective one. when we have to watch. >> they have limits to approach them in the business model. they are a threat. that's for sure. >> it's interesting for cnbc. tremendous amount of buyers remorse for people who have 36% manual actions. 80% of buyers said that they made more than one offer. there has been so crazy is now.

we would walk a mile first camera. there is a group of people, i'm sure they love the fact that you are insulted. >> very straightforward. >> we are approaching the top of the hour. all of these players are positioned ahead of him. we are going to get that tonight. how does that affect them? >> the snow is trying to move in. he doesn't care how he does. i think you will be disappointed. he doesn't care. >> in video, he got the warning. >> they did it again.

do you think it is possible that we can do it again? >> they would like the flesh. at least the gaming guide >> they talked about the dollar. the dollar is killing them. taking a lot of vacation. i find this is foolish. they were owned right here, and he's in indonesia. dream for us in person, coming up. you should not look at the self- help. they have so much more business to treat for.

we will learn all of the stuff from you. actually coming over here. if they listen to it, it's all about the dutch football. they are trying to work. they came up and gave a big hug. i was with my wife. [ laughter ] what are you talking about? >> we look forward to them tonight. in the meantime, let's get over. good morning, bob. >> morning. we have an advanced fly line. 4300 on the s&p. fairly different to what we saw earlier. take a look at the sectors. again today, a market leader on the upside. we see the empty stock coming

back. utilities, i know that nobody cares. one percent from the historic high. retail is getting clobbered. primarily do to nordstrom. slated to the house is in. they are weighing in on this group. advanced auto parts, they talked about the diy business. they were hit by inflation. higher fuel prices. >> the bond data and prices, even the energy prices, are not part of the bull narrative. 14 years, that's a killer. two months in for them i know. you have to be flat in august. why is that? the other economic data is supportive of the slowdown. that's what the fed once. that's what the bulls want.

they have helped lower this since january 16th. lois was here in 2020. it different manufacturer. august the 2020. you don't want too much of a slowdown. they are not supportive of the narrative. 10.3%. almost 17% last year. that's a huge drop. they talked about the higher commodities. it it doesn't look like it's defeated. they have ongoing inflation out there. we have 29.

it is $70 at the height of the pandemic back in 2021. it's about half of that right now. the big question, labor costs don't appear to be peaking imminently. obviously, the other costs aren't peaking as well. how will that fair on friday? he's going to rewind everyone. he wants to set the above rate right next to the inflation week. we are currently at 6.8%. the most obvious thing that we can do at this point, his point to this. we need to change these numbers. we need to remind everyone that it's a whole task to getting there. >> back to you. thank you. as we go to break this morning, let's look at the bonds.

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jim, you've got a big show tonight. >> first, i'll tell you, if anyone bought twitter, i we have frank slootman i frankly find him intimidating, the most intimidating ceo in america. he's dutch, he's tough, went to arasmus, a great college there

and i have benioff back, who i think has a tough story to tell, and bret taylor has been his co-ceo, and he had to deal with twitter. just hand it off to john ledger. don't -- what is the redaction about? >> it's protecting certain things. we'll learn more in good times. when we come back, we'll stay on top of retail. nordstrom is down as we have a pretty mixed market here s&p is down, too ♪ ♪ ♪ ♪ esg is responsible investing. who's responsible for building esg into your investments?

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good wednesday morning welcome to another hour of "squawk on the street. i'm carl quintanilla with david faber, live at the new york stock exchange cards being held close to the vest today s&p down about two points or so. we are watching oil back to 95, a lot of big earnings tonight. >> almost 30 minutes into the trading session, a couple big

movers, bed bath & beyond, we'll start with that. it's surging up with reports it clinked a deal to shore up its liquidity, looking to, of course, get itself on the right track, given all the missteps that have left the company in financial disarray that's a good work stock up 18% north nordstrom is down after reporting difficult results, also cut the full-year outlook, company saying it's dealing with excess inventory and will have to significantly mark down items. then we've got brinker international. let's keep an eye on those shares the parent of chili's and manningiano's. also lower than expected, shares are down 3.4%. spending homes on the tape diana? >> well, carl, pending home sales fell 1%, down 19.19% year

over year. that's slightly better than expected the street was looking for a 3% drop these represents signed contracts on existing homes. sales declined month to month in three out of forregions with just the west see an increase of 2% this is the eighth decline in the last nine months the realtors' chief economist says, rates have popped up again we have exclusive -- prices dropped 0.77% from june to july. that may not sound like a lot, but it is the largest sing of-month decline in prices in 11 years, and second worst july performance on record, with only july of 2010 during the great recession seg a larger single-month drop. prices almost drive june to july, because buying is

seasonal prices are still up just over 14%, but moth of that gain is due to big increases in the first few months of this year and, of course, the back half of last year. >> diana, you have talked for so long about the minimal supply of homes available. is that now changing, at least coming off of the data yesterday on new homes >> it's not changing very much at all you're seeing homes sit on the market longer, so there's a little more overall supply, but sellers are pulling back dramatically, because they don't want to be in a market where they have less power over prices of course you're seeing home construction drop. those numbers last week way down, due to not seeing any demand in the showroom that's just a bad storm for home inventory overall. >> interesting to note that shares of toll brothers actually revested course, they're up

slightly, but i'm curious of your takeaway. >> of course, we saw a massive drop in new signings, down 60% year over year, contracts on new homes, we're told. but in the commentary they said they started to see more demand at the beginning of this month, so maybe people saw mortgage rates pop up dramatically in june, over 6%, they pulled back in july, maybe they're dipping their toeing back in the water again. it's hard to say we did see -- drop more dramatically than we have seen in the last several years. we did see more supply on the upper end. that's why it was more active. now you have a ton of supply on the upper end, but not so much demand. >> diana, thanks so much for that a busy week for housing as we watch the market cool down. joining us is jay mccannedless, good morning to

you, your take on whether the sales slowdown will result in meaningful price declines? >> i think we're down about 45% year on year for august, which is certainly not a great number, but better than the negative 60% they saw for the full july quarter. we haven't seen that much in terms of outright discounting. i think it's been selective so far. it seems like the incentives are focused on rate buydowns, helping people afford those homes. >> you make the point that toll is a luxury price point, a different business than the rest of the builder coverage, so can we extrapolate to the broader universe >> i think what we saw from dr horton, and two other names, is

that the buyer who has a need, you know, family growing, new family, et cetera, that need-space buyer, they're still out hunting for shelter. we would focus on those three names first, but then, as we think about some of the other more luxury, higher-end names, we'll see what happens with mortgage rates maybe this pullback we've seen from 6%. toll always says they are a stock market-driven company, so with a bit of a rebound in the market, maybe that will benefit toll and some of the higher-end names. >> right you say you're basically long-term bullish on single family and multifamily part of that, i guess, is the structure demand, being structurally under-housed. how much is it tied to seeing more medium and top rates?

>> we don't have a formal rate forecast, but occupiancy and the jobs picture holding up, you put all of that together, that's the underpinning of our long-term bullish thesis on the group. certainly keeping a close watch on jobs, because jobs lead us into recovery, and they also lead us into the down side when the jobs start to disappear. so far, it seems like we're seeing good news on the job front, so not worried there. i think the other thing, longer term, especially what's different this time versus the gfc, i think the institutional demand for single family, that's a new source of revenue and earns for the home builders we didn't have. we've had around in small measure, but not to the stern we're seeing now even if the consumer may pull back, we expect that sfr

category to step in and pick up some of the slack from the consumer. >> i saw some stats in the last kiple weeks, the percentage of homes sold in which the buy other really has no intention of living there it's a nice source of demand, but optically, politically it raises some eyebrows. >> but if you are that needs-based buyer who needs shelter and you can qualify for the rental that puts you in the better school district, better amenities, the single detached family living that you're looking for, even though there's been political heat around it, that is a viable option that people will take advantage of, especially with multifamily rents moving up almost and more at this point from what we see from single-family home appreciation, think that sfr option is one that they will

take advantage of. >> finally, jay, when i asked diana about supply out of new home data, 10.8, 10.9 months, some argue that every time it exceeds nine months, it's a recessionary call. can we make those kinds of extrapolations in and out? now >> that seems like a high number, relative to what we have seen in our local market data, which is still running around two to three months. you look at nar's numbers, 3 period of time months for existing homes on the market, i think. i'm not -- that number seems unnaturally high to me, given -- if you compare it to the other inventory stats we have out there. one of things we have heard from toll and other builders is there are still random supply issues, so i think the inventory surge

we saw during the gfc and during the back half of '18, you can't rule it out, but i think it's harder for the builders to over-build >> fascinating it's got to be a hard market to read right now, and hard to match. jay, great stuff appreciate it. >> thank you. >> jay mccannless. twitter down a bit, but not as much as yesterday when we got the whistle-blower info. today, though, an important hearing. today didn't seem as important, the focus on data requests in front of the chancellor mccormick. originally twitter would be potentially in a position where it would be objecting to certain requests for data that musk's legal team was making, in part

because he said he might start a competitor should he prevail in court, and them telling, judge, you can't let him have the data that he could use to his advantage. i referenced the complaint earlier, but it's heavily redacted twitter itself would like to see all the allegations without the redactions being included. what will the chancellor do is the key question, in terms of allowing, perhaps for a new line of inquiry, or at least just diving deeper into trying to buttress musk's claims about the percentage of bots on the platform being far, far higher than the roughly 5% that twitter says it is, and will any of

this, or on bots rise to the level of a material adverse affect that musk could use to get out of the merger agreement. one thing we will be watching, is whether the judge will allow for more discovery carl, there is a question as to whether the counter-claims that musk has made, they were not based on security. they were much more focused on this issue of bots so it's not clear exactly what would be admissile or not. one thing is clear, if twitter does prevail -- excuse me, if twitter does not prevail and forced to remain a public company, liability from -- if in fact the stuff is true, it would

seem to have gone up >> that's sort of the reasoning behind the rosenblatt theory. >> my reporting until yesterday had been that the board was fairly solid in its opposition to even thinking about negotiating at this point, but you have to wonder whether they would be enticed to somehow consider entering into some sort of settlement conversations. we'll get more insight today, for how far and how long this could go a quick break here we'll get a road map for the rest of the hour, include a lot more on bed bath what that means for the meme names. >> president biden is expected

to make a big announcement on student load forgives in. and bozell thompson will weigh on musk and twitter, and quk t see ijust getting started.

the big fear that i have in the back of my mind is if, we're wrong and markets are wrong and that this inflation is much more embedded at a much higher level than we appreciate or markets appreciate, then we'll have to

be more aggressive than i anticipate probably for longer to bring inflation back down >> that was the fed's biggest hawk, neal ckashkari ahead of jackson hole brent chutee, and ernesto ramon. good to have you move. kashkari, listening to him change his tone, but you do think the bottom is in. >> i think you've seen inflation peak if you look backto the '60s an '70s, when inflation peaked, the market bottomed. my hope is the fed can look ahead and see what they have already done the rate hikes have caused an

impact, seeing housing go from bottom to bust on the good side of the equation, demand is slowed and inventories are being built. expectations are not anywhere near elevated, so hopefully the fed can take a pause, or at least slow the pace of rate hikes and tell graph that a bit on friday. >> ernesto, you seem, i would argue, less convinced that inflation actually starts to decline. >> no, not at all. in fact, i agree with brent. we see softening all over the place, in housing, seeing softening in airline prices, hotel prices, everywhere you look, retailers, everything is soft so i think we're going to get an inflation print in september on a month-to-month basis might reflect to slightly negative that would be good news and i think would drive the decision

for the september meeting, and -- but the market is already pricing in 140 biopsy, roughly speaking, until the fed starts cutting it in later 2023 so. >> we don't expect what mr. kashkari will say inflation is embedded for lop we think it has peaked and starting to decline. >> what does that mean for the market particularly, in your view what did you see what were you either encouraged by or discouraged by, ernesto? >> we're positive on the equity market, not ragingly bullish it all depends on the data and how that picture of hiking and

cutting will eventually look like, but the market is earnings to be up 8%, relative to 2022. that could turn out to be a bullish estimate we think it's fair with that kind of scenario, you probably will get a nice, you know, single-digit -- high single-digit move in the market from now until then. that's not a bat return. that's not 20%, but still good enough return you want to be positive there's areas in the market under tore underweight in, but that's a bottom-up call coming from the companies, and where we see the fundamentals in valuation right now. >> brent where does that playbook -- >> we're more toward the cheaper side look, if i told you the economy was going to slow as dramatically as it has in the

past six months, i think most people would have thought i was crazy. that's what's transpired if you think the economic outlook starts to shift just a bit in the next year, i think you have a backdrop for continued gains. that's where it's most focused >> give us more on that. where is the average p/e right now. do you expect earnings will go up, or multiple expansion? >> i think you have kind of a margin of safety against declining earnings they turned around 14, 15 times current earnings and 13 times 2022 earnings, which is historically cheap relative to the overall average, and not too far off where they've dropped in prior periods. i think valuation is a relative tool, and relatively cheap to their counterparts that typically will be a good backup

we could certainly have a mild recession, parts of the economy are probably already in recession, but that changes in 2023 if you believe the fed is ability to back away and not eviscerate the economy by tightening too far, which we don't believe they will do. >> ernesto, finally, i'm thinking china, ukraine, and maybe even the mid terms, which do you think will be most material before the end of the year >> that's a hard question. i moan, there's so many single factors you could worry about. ukraine is unpredictable russia could decide they want to detonate a device in ukraine to send a message that would be a gang-changing event. europe is flowing, it's in recession already. but china has issues with property that could go binary in a wrong way, though the

government has a lot of research to prop them up. they can keep propping them up, but for how long zero covid is a big issue. they're basically growing at 2.5% -- in the mid teens for many years so, so many external factors, but i would say china and what might happen there would be top of mind for us. >> that's what makes this particular market so hard to read thank you both see you soon. as we head to break, peloton announced it will begin to sell products on amazon that's having a very positive impact on the stock, up more than 17% we'll have more on other big morsn ta, teth ve ireilafr is

[ "back to life" by soul ii soul ]

what if you could change your surroundings with the touch of a finger? now you can. biometric id... inside the innovative, new c-class. welcome back it's a good day to look at the xrt, losing about a quarter of its value this year. rising inflation, a more cautious consumers causing many retailers to struggle, and it's

led to discounting our courtney reagan has more on a few big moves today. >> carl, yes, interesting details in the nordstrom report after the bell in some cases different than what retailers had seen. like macy's nordstrom put up a slight beat, but investors are focused on the move to slash the forecast, well below estimates, and lower revenue expectations it's the worst day since november of 2021 when last reported, down more than 18% nordstrom's lowered expect after it saw a deteriorating trend in july compared to may and june. the retailer says of lower-income shopper is being hit, and it saw lower sales of the lowest priced goods. conversely at its department stores, the highest prized luxury goods sold the best while there was much less

interest in private label goods. remember, they all saw strong demand for their private-label goods. men's was the strongest category at nod strom for the balance of the year, nordstrom does plan deeper discounts and other inventory adjustments, along with investments in the supply chain, and just general caution about the consumer meantime, bed bath & beyond has a new sort of liquidity. shares having the best day since just august 16th, would this reports that the troubled home goods retailer has selected a lender to pad cash levels and pay debt, though who and how much isn't yet known or being reported reports have suggested that bed bath & beyond vendors have been reluctant to they want goods for fear of not being paid it has an interim ceo, along with supply chain snarls and

other missteps shares have been very volatile apt gamestop chairman said he was selling his stake. back over to you, david and carl. >> yeah, you know, courtney obviously the inventory issues, we've seen a number of retailers -- target comes to mind foremost -- but where do i go to get bargain? because there's going to be such significant markdowns. >> yeah, in a way, david, i think everywhere, but if you look at the inventory levels, target's inventory levels were much, much higher than nordstrom. the sales growth was up over 12%, so actually pretty good i think, by and large you'll see

bigger and broader discounts at a retailer like target, though nuance for certain is within there. some of it was brought in early on purpose, some increased because those are categories that are selling, but generally in you're in the market for apparel, i think you'll be in luck it does seem the market will probably will be where we find the deepest discounts, whether at nordstrom or a target >> i see we have some shopping tips as well from courtney, not just coverage. i've got it all. >> yeah, absolutely. i'm going to go out and buy some apparel. after the break, we have rosen blatt downgrading twitter, saying yesterday's complaint compels us to pull back on the elon musk deal we'll have more on that coming up stay with us

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welcome back to "squawk on the street." i'm bertha coombs with your update the u.s. launching air strikes in syria towards what it says was infrastructure. there are not believed to be any categories from those strikes, which hut nine bunkers used for storage. it was in retaliation for attacks on u.s. forces in syria back in february >> the announcement coming as

ukraine is celebrating its 1991 declaration of independence from the soviet union. len dawson has died. he joined the dallas texans in 1962, and followed the franchise to kansas city, where he led the renamed chiefs to a championship back in 1970 he was 87 years old. carl >> famous picture of him from a fresca and a cigarette making the rounds today bertha coombs, thank you let's get a check on the biggest leaders. cruise lines, warner bros. out there. and the laggards further down the list, some chip names as well. we're also keeping an eye on twitter shares the whistle-blower complaint

yesterday revealed that the company deceived regulators and its own boards about the security systems, the ability to fight spam, and a number of other allegations, ahead of a hair today in front of chancellor mccormick with us now, former ftc commissioner and facebook adviser mizell thompson. good to have you. >> good to see you. >> i'm curious on your take. the ftc did have some overtake there was a consent decree entered into some time ago what was your takeaway >> two aspects one, there is a 2011 complaint, but there was also a settlement at the end of may. it was on slightly different things, but as part of the first consent, every two years they have an independent auditor. the ftc gets the report of that

audit. since 2011, i'm sure they reviewed that in the latest settlement it is only at the end of may. >> right. >> as part of that settlement, included some of the points raised by the whistle-blower, that they had to be more robust in looking at the audit, but they also had to limit the number of people who got to see personal data. so it showed me they actually saw that so the question is, with this whistle-blower complaint, is there anything new that the ftc hasn't seen? >> again, as you point out, the new settlement only a few months ago, this gentleman left the company prior to that. >> right >> hard to know, but can we come to any conclusions that is ftc knows everything he's already told them? >> it is possible. it is possible what i thought was more interesting is what he's put in front of the securities regulators, in the sense that

maybe not so much from mr. musk's purposes, but is he alleges the company engaged in this broader fraud scheme, to defraud investors by pitting out misleading information that would be a more interesting, consequentially investigation. >> it would, though it could stretch on for years. >> absolutely. the ftc i'm sure will be under pressure to look at things again, but i'm not sure how much -- they've been pretty aggressive so far with regards to the tech industry if you have something at the end -- end of may, i'm not sure how much information is there. they had a chance to look at it. it's interesting to see what turn they'll take. >> what should consumers make of the ftc and its oversight.

are we to believe they are in there making sure things make sense? >> that's where the pressure is going to come. what have they been doing with they audit every other year, and whether there's an accurate picture of what that audit looks like it also says the person pointing the finger, too, because he was there for a couple years, so he was responsible for what was proud. the question is, will they look at this again. >> that was definitely twitter's view others are asking, what is the role or legacy of a whistle-blower now in the wake of francis haugh >> he left in january, and had a

long time to raise the complaint. he files it in july, but goes public with it right before the hearing. just because he -- you can question his motives, it doesn't necessarily mean there's a problem there. >> though as you point out, the timer we're all trying to figure that out. >> right. >> a lot of reporters were involved in the story, a very good story, but the judge will have to make a decision whether these areas are worth delving into the claims he made, though, in the complaint are not really centered on bots, which is at the center of the difference of opinion, so to speak that musk and twitter have >> yes, but i think the only way you get over the bot question is to actually allege some broader fraud that the court should look at what i thought was interesting about the whistle-blower complaint, they talked about the ceo and senior management having

led some misleading documents, et cetera. i'm not sure he alleges that the company itself was involved, or that the board was even aware of t that will be an interesting line to crosses to figure out what you can attribute to a person or a small group of people. >> and they have the burden to prove there was a material adverse effect without having to pay much, if anything. >> with mr. musk's kay especially, because he waved due diligence, that puts him in a very unique position you can't complain it's not material in one sense but material in another sense. >> unique position is a good way to put it. i don't know to what extent to make it clear -- to make it clear, i've been away from facebook since 2013. >> even better

the ftc drops mark zuckerberg from an antitrust lawsuit. this is a story related to the small company they want to purchase that will help them in the metaverse. anything we should draw from this >> it's one thing to sit down and talk about a company's behavior, but to attribute to a person, that's always difficult to playoff. >> mizell, always appreciate it. good to see you in person, too. >> thanks, good to do you. people are still spending on in-person experiences. our seema mody has more. >> the latest bank of america credit card spending data illustrates how americans are shelling out cash, on golf courses, for example, accelerating in august after posting a 5% gain in july

theme parks were the strongest leisure stock. americans boarding royal caribbean and senator evenen cruises are spending about 30% more on activities than they did in 2019. in fact, virgin voyages says spending on board on luxury clothing, jewelry up 50% self-care experiences like spa and beauty, up 75% this year it follows a big rebound we have seen in cross-atlantic travel. however, b of a says they expect the dynamic to fade because of travel disruptions in europe, drying up the pechbtup demand and potentially peaking of the u.s. dollar, sort of mirrors a survey conducted by trip adviser, with over a third of

respondents expected to take shorter trips. it's one of the reasons a lot of these hospitality-centric stocks haven't really kept up with the broader market. thank you so much, seema still to come, the president expected to announce student loan relief. we'll have more. dow is down 20 to adapt in the changing world, you could hire a professor of theoretical mathematics. we all know this equation, right? he'd crunched numbers day and night. that's it. to maximize profitability. morning. i have quarterly numbers that are beautiful. and forecast revenue from every corner of your organization. is that important? or you could use workday. the finance hr and planning system that helps cfos make better decisions faster.

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president biden expected to announce student loan cancelations this afternoon. share epperson has just how much debt will be forgiven and how it will work. >> exactly, david. about 15 million borrowers could see their loan balances erased if, as expected he canceled up to $10,000 with borrowers with less than $10,000. it's a collected $1.6 trillion

in loan debt the average balance is more than $40,000. he said he would limit the amount of student loan forgiveness even as advocates press for more a survey found 34% should only go to those in need. 32% said it should go to all, and 30% said no one should have their loans canceled now, again, we expect to hear from president biden more about this later this afternoon. so far we have not gotten any details on how this forgiveness will work, but there is a lot of what you should be looking on the for that you can read more about on cnbc.com/personalfinance david, carl? >> sharon, talk about how it affects -- what sort of demographic really benefits. there's a cap. on the other hand some would argue a lot of people who racked up a lot of debt might have been

salaries with good incomes. >> a lot of women of color will certainly benefit. many doctors, lawyers, would not be in the position if not for their education, which they actually had to borrow to be able to afford having those loans forgiven will mean a lot it will also mean a lot for independent contractors. we talk to artists, people working freelance, yes, i'm making good income some weeks, some months, some days, but it's not consistent this will help them as well. >> sharon, there have been those who argue there could be across the board loan forgiveness for everybody. is there expectations more to come, or will this be it when it comes to this issue? >> as the education department and biden administration have pointed out, they already

provided student loan relief a significant amount has been done with started loan forgiveness programs i think there will be more details to come, to makes thor moss efficient for people who qualified to actually get that relief as well then we will have to see again the details of what will be announced this afternoon to find out exactly who will be able to benefit. a whole scale loan forgiveness programs, everybody who has student debts, having their loans forgiven for a certain amount, a not necessarily expected, but we'll have to wait to see what happens. >> interesting, the critics of the policy argue it doesn't help universities rein in their costs. it does not incentivize to shop around for deals and if you can forgive the debt, that would allow them to have more personal income or savings that will theoretically feed

inflation. >> that final point is not what we found in the exclusive momentum survey, where it showed that the people who were polled said about -- half of them said they would pay down other debt if they didn't have to pay the student loan debt. about 40% said they would save for retirement with that quote, unquote, extra money, another third said they would buy a home so people are making decisions, at least they're planning to, to impact their long-term financial future it's not like they'll put it right back into spending today, which would perhaps increase demand and inflation but that's not what they're telling us sharon, thank you so much. shape epperson on the president's announcement. coming up on "techcheck," we going to talk to the ceo on of heels their results. is tiktok ruins the in

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flip side. she sold nvidia, 293,000 shares. interesting, had a discussion with cramer about what their guidance might be like tonight. >> surprisingly, jim was not that upbeat. again, i don't want to take too much away from that. remember, we already got a warning a couple weeks ago from nvidia about this current quarter, focusing on gaming, what seemed to be perhaps a slowdown there, maybe pandemic related. people getting out, not gaming as much. there was a bit of a followthrough from inindnvidia, although the stock itself didn't come down that much. >> as i managed, bernstein last week, i believe, looked at past histories in which they did warn on gaming or gaming had a big flush and the recovery was pretty swift and managed to last for a while. the thinking is maybe we're in that period where they can flush out the guidance on gaming at least and can recover again. we'll see. it's going to be key in the market for a new car? demand is still surging.

we'll talk about wt hathat means for auto stocks in a moment. ♪ ♪ ♪ ♪ all-electric with room for up to seven. it's the suv electric has been waiting for. the all-new eqb from mercedes-benz. ♪ ♪

welcome back record profits and strong demand have auto dealers and a number of the stocks for those

companies moving higher. phil lebeau has more on car sales and the moves on some of those stocks as well phil. >> david, you know what's hotter than auto sales right now in terms of the demand out there? auto dealerships in fact, the latest report -- we have new data from kerrigan advisers showing auto dealership sales -- these are dealers who have sold out to other dealers, often private dealers, those sales were up 16% in the first half private dealer groups are doing most of the buying right now why are dealerships in demand? take a look at what's happened with the profit per dealership in the first half of this year, if you annualize it, kerrigan says it will come out to 4.2 million. a few years ago it was down to 1.5 million annual profit. s whether auto nation, group one, penske auto group, all of those stocks have been moving higher over the last several months because people are saying, look, things are going

to change dramatically for this group. the profitability, while it may not be as high as it was in the first half, is going to remain high by comparison, take a look at the internet auto retailers, talking about carvana, car gurus, vrmoom, lot all of those continue to struggle because people are saying where is the long-term profitability? you can sell a lot of these cars, and their sales are up about 20% this year, david, but the real money when it comes to auto dealerships, it's on the service side of the business that's why you see such high interest in auto nation, group one, all of the dealership stocks >> give me a little more here to understand this rise in profitability. is it really the aftermarket servicing your car is it always due to margins? for white some time i was under the impression they couldn't get enough inventory at all so the sales numbers were repressed. >> sales aren't where they make

a ton of money certainly on the new side of the business your margins are very limited. it's based on one, buying and selling used vehicles, where they've made a lot of money. also the service side of the business, about 50%. then you have the finance and interest component which is also a growing part of the business for the dealerships. services where they make a ton of money, and while there area lot of people out there buying new vehicles or buying new used vehicles, one thing doesn't change, david. when you need your vehicle worked on, yes, you can maybe go to an independent mechanic, et cetera, but increasingly people are saying i'm going to take it back to the dealership where i bought it or where this brand has a warranty if i've got a toyota, i go to the local toyota dealership. >> the enter northwest-based retailers as well have a financing component. that's been pressured given the rise in rates as well. phil, thank you. phil lebeau.

we should mention the actual sellers of the automobiles as well, or should i say the makers of them are up, lucid, rivian, ford, gm and tesla all nicely higher with a market that has the s&p 500 up about .25%. that's going to do it for us on squa"squawk on the street." "techcheck" starts right now. >> good wednesday morning. welcome to "techcheck. i'm deirdre bosa in san francisco with carl quintanilla and jon fortt out east today a breakdown of the consumer across the ecosystem. the top gainer on the s&p as small business demand proves stronger what peloton's new partnership with amazon means for the d to c names as names across the space get a boost. finally, is tiktok ruining the internet more on how it is changing the digital landscape? that's all later this hour. >> we'll start with a read on small business drengt. intuit shares popping on a