week. >> i thank you for covering for me. >> you know how cities have sister cities in italy we're like that. >> san francisco and cambridge >> exactly you are here sometimes in the morning. it is still hard to come back in here >> i'll do it for you. >> thanks. after this love fest, the check of equities. after the slide that started with last week's jackson hole speech, the s&p looking to add 35 points. the dow fell 184 in yesterday's session. the s&p fell by .20% the nasdaq fell by 1%. treasury yields. a sharp eye on the 2-year treasury which hit the highest level since '07.

3.415 for the 2-year treasury. >> that's high >> high. 4.89 is the highest since 2007 >> if you want to get that yield above inflation, you can do the math de depends. still a long way on the 2-year treasury more than a few moves. here is the developing story in iraq. violent clashing gripping baghdad after the cleric said he was leaving the government muqtada al sadr. clashes with security fources the nationwide curfew has been

announced. the u.n. mission for iraq said the very survival of the state is at stake. we will talk more about this, a developing story, and impact on the oil markets with brian sullivan at 6:30 a.m. eastern. we saw a lot of the cable networks yesterday or this week, melissa, were looking back at the afghanistan pullout. it's just a little strange we lost afghanistan and now the instability and replay of that in the two wars that just tore us apart for years and years we lost so many guys and gals and everything else. now you wonder about iraq. i guess. in other energy news -- that is a big part what have we're talking about. dutch gas prices plunged 20% yesterday. the steepest drop since march. the decline brought prices down from levels last week.

germany said yesterday the gas storage facilities are reaching capacity faster than expected. president biden will deliver a primetime speech as he campaigns ahead of the midterms. he will address america's rights and freefreedoms he will speak outside independence hall in philadelphia. stocks to watch. bed, bath & beyond shares surging 20%. up by 13% pre-market this as investors express optimism ahead of the update release from the company slated for tomorrow >> $15 i remember it much higher. that's a big move. back to 15 the cheaper you get. >> the bigger the percentages. peloton. think about this announcing it is delaying release of the annual report on

its financial performance. the company said in the filing it needs more time to sort out accounting tied to restructuring efforts before releasing the 10k. peloton has to figure out the financial impact of parts of the turn around plan, including moving away from home deliveries and warehouses i tried to go back in time to figure out how it was mass hypnosis that people would pay to watch someone yell at you on the tv screen. that subscription fee. who thought that was good? >> i thought the subscription part of the business made sense. everybody fell into the spell and people continue buying the hardware >> and not go back to gyms >> and not go back to gyms and hardware sales would continue. the flywheel for the software. that piece of the puzzle fell

apart because everybody bought one. >> the person yelling at me from peloton didn't know i was slacking >> do you slack? >> i would like to slack i hate exercise. >> you exercise regularly. >> i have to i have someone that makes me do it at the gym. at the gym >> they yell at you in person? >> you know, he knows how many reps i did and if i finish all of the sets. i get 30 seconds between that for me is the only way i can do it. i don't like exercise. i'm self motivated i want to hook up a bunch of things wouldn't that be nice? hook up and do this. >> they strap that fabric around your belly and shakes you. >> that would work or stimulate your muscles >> shake weight? >> the what? >> the shake weight. >> no. what is that >> something you might do. it is easier than it probably is >> people go back to gyms.

a sauna. if you go in the sauna four times a week. >> it's water weight. >> you are less likely to get dementia a long time youtube executive robert kinzel is leaving the streaming giant after 12 years with the company. global solutions company president will take over the role of the chief business over in early october the previous gentleman -- can i buy a vowel in k-y-n-c-l did you ever notice when people buy a vowel when they don't need >> or confirm this hunch >> that, i think, we should -- where would you put one? i put it there that person is going to stay at

youtube to help with the transition if i said it any way i wanted, do you think anyone would think i'm impropermispronouncing it? tesla challenged the law for vehicles sold directly to consumers. tesla has been fighting other lawsuits in years. the c the company won a lawsuit in michigan to sell directly to customers. buyers must then go online to actually purchase a vehicle. >> you see a lot of teslas >> yeah. >> every other i'll take a video of it when six pass me in a row >> they are more common. you see model 3s car services have model 3s >> i watch them. i bet that is going to be a tesla.

it is. in other tesla news, nlrb said the company violated worker rights when they said they could not wear shirts with pro union insigni insignia now mandating the company cease and desist from maintaining and forcing the overly broad team wear policy to prohibit from wearing black union shirts tesla argued before the board that the dress code was meant to prevent worker clothing from causing mutilations to the cars and car seats they were building and help managers easily determine the employees are in their assigned work areas. maybe you can't see them as well black union shirts. >> you have to wonder if they have uniforms. if dress was so important, it would be a uniform required.

this is difficult to enforce. >> union is interesting to watch. >> it is the time. workers have the power and upper hand >> many of the woke-st companies for unions, howard hoschultz. i'm only wilgsling to go the li. it is funny to watch irony of it is amazon. >> yeah. i agree. >> do what i say not what i do. coming up, new read on small business hiring. ceo of paychex will join us. and best buy is reporting after the bell we will hear from hp and pvh you are watching "squawk box" on cnbc >> announcer: this cnbc program is sponsored by truist securities

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>> a shocker >> to wake up and share this time with you, joe >> that's not the best way -- when i came back after two weeks off, i did two nights of "fast money" in addition to three hours in the morning that was a culture shock going in and out we talked about that and quarterly results. who did the show last night? >> courtney. >> she's good. i like watching her. big lots reported a smaller than expected quarterly loss. sales fell 9.2%. less than anticipation big lots said it is taking aggressive action to cut costs small businesses staying on the rise with the hourly pace set in may the continue of that pace is slowing. joining us ahead of the friday job's report is marty mucci of

paychex. >> good to see you. >> marty, for a small business k perspective, they don't have the means with input costs and wages. is there a tipping point with wage growth and small businesses saying we can't afford to do this anymore >> melissa, you are seeing it. the slowdown with the change of momentum in the last few months. part of the slowdown for small business hiring is that inflation pressure with wages over 5% overall. in some sectors of the small business market, these wages are up 7% in services. part of the inflation pressure of the wages and part of it is just they can't find the people. it is harder for small businesses to hire in a tough market like this with so much

churn. >> marty, what are the sectors that are seeing the most of that cool down? are there sectors that are feeling it the most in terms of we can't afford to continue increasing wages >> well, it is hard with the data to see it leisure and hospitality is the farthest behind. when you think of the pre-pandemic, 1 million jobs fewer than pre-pandemic. the jobs that people want are remote work and more flexibility. they are not filling those jobs. wages are up close to 6.5% in other services that people use, they are over 7%. it is feeling the pressure what are small businesses doing? cutting hours. you see it in restaurants. it is a lot of pressure. the biggest growth in not only wage now, one of the biggest in wages and job growth is in the south. the south used to have high job growth, but low wages.

now wages up 5.5% in the south that's interesting you have great job growth and great high wage growth. >> when you look at the data, marty, it is a little more real-time with the process at any given moment how do you look at this in the context of the national labor trend? is this a precursor or indica indicator? >> small business is a pre precursor. we had a big jobs number last month, but you may see adjustments from that. i think it will come down a little bit it will slow a little because it is tough to find people again, but because of the inflationary pressure that you mentioned earlier. both of those will slow down a little bit we will not have as big a jobs number as last month. >> any indications, marty, that you are seeing that make you concerned for the picture of small business in terms of what they are doing with wages or

hours, et cetera i wonder in the scenario of the recession or hard landing, what you anticipate small businesses to look like >> i think we are not seeing strong measures here. there are still a lot of job openings for businesses. that is the toughest thing they have the demand and they have the need for the workers. they have a little harder time finding them i think we are starting to see the highest rate of people with two jobs in history. so i think we're starting to see people take that second job and hopefully small businesses will be the positive recipient of that it is interesting that the googling of second job or side hustle is up 40% according to google a lot of people looking for second jobs. that should help small businesses. >> marty, great to speak with you. thanks >> thanks, melissa

>> i have two jobs anchor and "fast money." >> i had two jobs on monday and tuesday. elon musk send a second termination notice to twitter. musk said in july that he was pulling out of the $44 billion deal to buy twitter. the new notice detailed in the s.e.c. filing gives additional reasons for terminating the deal among them, musk said the misconduct alleged in the whistleblower complaint is likely to have severe consequences for twitter's business coming up, a new bill in california would create a government panel to set fast food wages details after the break. "squawk box" will be right back. >> announcer: today's big number $1.2 billion that's how much the irs will

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california's legislature passed a bill p yesterday to create a government panel to set wages for 500,000 fast food workers in the state known as the fast act. it would establish a panel with members appointed by the governor and legislative leaders. composed of workers and union reps and employers and business advocates.

every time i intro your show, i say tonight on fast. this is the fast act it has nothing to do -- >> very clever. >> a lot of promos here. trying to help 5:00 p.m. east coast time. they would set hourly wages up to $22 for fast food workers of the get your fast food while these places are still open. future wage increases are tied to the consumer index. governor newsom has until the 30th to decide to sign or decline the bill the department of finance opposed an earlier version of it representatives from mcdonald's, yum brands and chipotle have rejected the bill. they don't teach econ anymore. you have no supply sdp >> the notion of government

setting wages in private industry no business advocates representing chipotle and mcdonald's and all the others. >> if we could make everything not-for-profit, that might work. that's hard to do. >> it would be a different country. >> it is hard to have competition and innovation >> right. >> accountability. dmv. we don't need to go there. coming up, we will talk about the move in the natural gas prices and potential for the oil market disruption in iraq. that's next. as we head to break, look at the s&p 500 winners and losers >> announcer: executive edge is sponsored by at&t business

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good morning welcome back to "squawk box" live from the nasdaq market site

in times square. let's look the futures looking at higher open 34 in the s&p. nasdaq up 143. you know i have been away for a week or so it is interesting, with the selloff, joe, the vix, still slow 30 and 25. amazing. you can sell off to that degree and not see much of a move >> wear are having a long discussion with el erian let's go 4,000 i said the next move is 10% up 3600 we are right back to 4030 is when we closed after the recent rout i think yesterday he felt less certain we would hit new lows under 3600 i was caugounting my tacos

that's the bet we almost got there. now we're back to -- i don't know if i covered yesterday and i would say call the bet off we're right at 4,000 what do you think? >> i don't have an opinion >> i don't i do now i think we switched to where we are trying to convince all the bears they were right all along. i still think the train left the station and 3600 was a good place. >> i agree that the next move is lower. probably >> new lows. that's the question. >> fnew lows i don't know about now lows. >> that's what i mean. >> okay. another bet brewing, i think tacos still motivate me. fyi. >> mets game with him? that's what i have to do if i lose >> he's the real loser in that one. >> a lose-lose for him

first solar shares rising pre-market the equipment maker will spend $1.2 billion to expand operation in the united states the plans including the factory in the southeast u.s it said it was unlikely to build a new u.s. factory, but this about face is after the passage of the act. let's talk energy and in europe in the past 24 hours, a lot of headlines from overseas with an even rare bit of good news to talk about brian sullivan joins us now with all of it. brian, good morning. >> good morning, melissa good to see you. welcome back first off, good energy news around europe. i don't think i said those words in the same sentence in a year european spot natural gas prices at dutch tti prices have come down a bit still super high they have come down the last couple days.

on optimism of german natural gas storage. germany saying storage at 81% which is ahead of schedule that is good news. remember, guys, storage is the back up to the flow. the flows have been reduced. so storage in a better place than they thought because the weather has cooperated they have been rushing u.s. lng. not a full solution, but decent news it has been raining. why do you care? the rhine river and other rivers in europe have been so low, they have been unable to get coal and oil barges down the river to power fuel rising water levels have helped get more energy in good news the last couple days if you think this thing we have been talking about for the better part of the year is over after this winter, think again ceo of shell saying the energy crisis may last longer and one wi winter joe, you will love this.

the techno crats in the eu will change the energy market works with separating the price of gas from electricity because the system is barroken. they were in charge of the system, but now they are fixing the system that they were in charge of broke. where have we seen that? the other day german power prices hit 1,000 megawatts per hour what does it mean? 100 megawatts an hour in boston or new york or california have been higher. 100 over a couple days is high we have seen electricity prices double in new england. they are paying 10x what we are. what about oil could oil which is down a little bit this morning be about to soar maybe. you have to watch iraq exports are not impacted yet there is violence in iraq. people stormed the capitol

15 people were killed in some of the riots/protests iraq is the fourth biggest oil producer in the world. any slowdown in ex-poports coul send oil prices higher we interviewed jeff currie at 5:00 a.m check it out he still has a $120 target on crude oil by the end of the year as i reported last week, opec may be ready to consider cutting output cutting output our conversation with the saudi oil minister a lot of good news from germany. joe, i know you floated down the danube with your family. you can walk down the danube right now. >> you have seen those pictures. you are right. beautiful. >> exposing treasures. >> yeah.

budapest beautiful nighttime cruise brian, i don't know. once again, oil, i can argue both sides i have a feeling is it in the sustained up trend there are times when it doesn't respond to what it should be >> like now. down pre-market although the developments in iraq >> 90. 80 was the low we are in a different range. we're in an 80 to 120 range, brian? >> that seems to be the ckc consensus forecast currie is higher i'm like a blimp i hover and try to aggregate everything >> that should not be in your lexicon. >> i'm like a blimp. >> you are right >> i'm like a blimp. that could be taken -- people take things out of context all the time

>> there's a great -- there's a great poet that i listened to in my teens i even saw the lights of the goodyear blimp anyway, i'll say derigible the ago degr anyway, i'll say derigible the ago degate seems rappoito point to higher prices. no indication yet, but we're on this razor edge. this tight market. u.s. production is going up. not going up that much i want to leave you with this. it takes 4,000 new oil wells in america -- some say just in the permean to get back to where you were from the natural drainage of wells 4,000 to stay equal. driving miles are up you were on the road recently, joe. what you said the other day hit

home i've been driving back anding fo forth a lot this year in the midwest. i pay attention to cars. i'm in the market for an electric car in new jersey, teslas are like cicadas. they pop up. once you get on the highway, they're gone i drove across the midwest twice this year. i'm about ready to do it again you just don't see them. you don't see them >> i got to cut you off to get to somebody i had to cut off yesterday. we'll get to it. we come full circle. we have to get to this person right after this break in addition to that, coming up, futures pointing to a rebound for stocks we talk strategy after the break. and we have kyle bass on the economy and inflation and more you can watch and listen to us live anytime on the cnbc app

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let's get to the markets joining us to continue the conversation we started yesterday on the pull back of the summer rally is kristen bitterly at citi global wealth good to see you. >> thanks for having me back. >> you're welcome. you probably don't know the full

story yesterday. for the first time in 16 years, i had to be here starting "squawk on the street. those guys with no cameras and no audio we had you booked as the last segment. we were starting at 57 pantst te hour i introed you and asked a question at 57:25, they said you have to be out at 57:30 and switch control and anchor squawk. first time in years. i asked you about the bear p market rally we saw. you started by saying i still believe it was a bear market that we're in and that was a rally. you started ticking off reasons for it the first you cited was short covering now at that point, we had to go to break immediately.

unbelievable let's start there. you said one of the reasons is short covering expound. go as long as you want about short covering we can go to seven >> absolutely. my joke theory published a p piece. he published this at the beginning of august. the first point which gets to the concept of short covering was the very bearish positioning that had exacerbated moderately positive news. that bearish positioning we saw across institutional clients and retail clients we're looking at how bearish the market was this was the worst start to the year in history when you look at equities and fixed income declining in tandem by more than 10%. that hasn't happened you saw the reports around one of the worst starts of the year for the 60/40 portfolio

u.s. equities futures in the short position reached the highest levels in over ten years. what happened? a lot of people thought maybe the worst was priced in. maybe we overdid the selloff there is positive news coming or we already priced in the damage that was done from the bear market we saw that and we saw really resilient q2 earnings. we saw resilient and tomorrow line revenue growth to the upside the market took that and continued to rally the one piece though and this goes back to why chair powell said on friday and really reiterated is the fact that people are starting to find dovish signals in the fed. we didn't buy that the fed has been very resolute on what they're doing and why they're doing it and they will continue to a hawkish path i think friday eliminated any of the ambiguity. >> you were just saying players had been set up short.

indexes or whatever. a generic comment that people were positioned for a selloff? >> exactly they were expecting it >> nothing to do with meme stocks or short this or short that i said to someone yesterday that on market watch when they don't know why the market goes up on any given day, they say short covering short covering is the most common reason for market advance. i heard it 10,000 times in my career, i would say. i don't understand the whole notion it is a very good point. people positioned from june 16th, short, and there was covering talk about -- >> look at what you were saying earlier just in terms of the vix being mute pmuted. we saw continued selloff yesterday and today, futures look positive. paying a lot of credit ence mar

action patience is required invest ors are in a wait and see mode with light volumes and cash on the sidelines as the market awaiting what will happen with jobs data on friday and what cpi data on september 13th this is a market that requires patience and paying too much attention to some of the day over day moves could get you into a little bit of trouble >> do you think, kristen, that we go to new lows, below 3600 -- it is a fool's errand to figure this out would you buy on dips or sell on strength at this point for the next three or four months? >> we actually have been preparing our portfolios for this the one thing the market is not pricing in and we have to be honest about this is everyone is looking at what is the fed going to do? is there a pivot in the fed

that has been taken off the table through the rest of the year the conversation will pivot from the fed to the earnings. in q2 earnings, we think about the impact of tightening on the market, we should not have seen that in q2 the impact with rate hikes and quantitative tightening has some delay. it can be anywhere from 12 to 18 months we have done seismic shift was the rate hikes already how that flows through to future earnings is going to be critically important to the direction of markets it will impact consumer behavior from the spending standpoint it will impact corporate behavior the issue is quality and balance with equities and fixed income >> very good kristen bitterly, thank you. >> thank you >> i said sorry yesterday when i tossed sorry again that happened. good to have you back. we will see you again soon

>> thank you >> all right >> do you feel you cleared the air, joe >> i said it was a sad commentary yesterday they will take that 20 seconds where i said we've got to go to break and i explained to everyone audio problems no cameras. >> it doesn't matter they don't see the actual product of the many people online. >> they see a chair. >> they see a clip it goes viral. youdon't go to the original source >> it all goes back to melvin capital and schwartz all she was doing was making a generic point. someone was in my ear. she made a comment about short covering people were positioned short she was getting ready to say i was here until 9:15. i was interviewing jim cramer on

his own show david faber was on later it didn't matter they don't care. this makes me wonder about reddit and twitter and social media and the world we're in right now. i don't think it is a great world. >> they could do this were a politician >> they do on both sides. >> the level of -- it is a true clip it actually happened the context. >> all they had to do. no one wanted the truth. no one wanted to see what happened >> imagine this happening over and over and over again with different issues. >> right. >> in different countries. >> none of them have names all anonymous. they say things that would be slanderous if they had a name. whatever i worry about them you know what they say a fool >> i worry about our society. >> i don't know whether these

types should be -- i'm not going there. do what you want to do. coming up, summer travel season is coming to an end we will talk about sky high air fares and room rates and the potential chilling eecfft on travel in the fall the ceo of wyndham hotels joins us

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travel demand remains strong this summer with some areas seeing a return to pre-pandemic levels although the price for travel is higher data from kayak predicts that the average price for hotel rooms will remain at $290 per

night. joining us to talk about the travel season, the ceo of wyndham hotels and resorts jeff, the salad days are back. you've got some pricing. do you have labor? do you have employees? are you completely open? or are you unable to provide the service you want to provide because of the difficulty of hi hiring people? >> staffing, joe, has actually improved over the summer months. it was an issue before covid unemployment was 50% in our industry it's back to a little under 8% the travel demand has been off the charts it has really been an endless summer in so many ways it was the best memorial day that we've ever seen, equally impressive july 4th. and we're expecting the same for

this weekend coming up with really strong labor day travel where 60% of americans will be out on the road traveling. >> inflation's impacting everyone across the board, so, and price, i'vyou've got some firmness here, there's pent-up demand, people want to go places are you raising prices more than your input costs? >> our margins are back up above 2019 levels in the select service space in theunited stat of america they think 2022 will be even better pricing is up, but really inflation adjusted, it's about where it was back in 2019. there is still a lot of opportunity from pricing we're trying to give our franchisees all the tools they need to make sure that they're

competitively priced and raising their rates when they should be. >> when i hear pent-up demand, i think there is pull-forward element to this, jeff. how kf confident are you that te level of travel that we see right now is not one-off and that it will continue in continue >> mastercard just put out a survey july being one of the strongest months ever. we think august will look about the same coming in we know the middle class are earning more, spending more and not giving up on travel. one of the things our franchisees are seeing is that people are willing to drive further. they're willing to get in their cars as they will this weekend and drive much further than they were back before the pandemic started, and there's also the impact that some guests have

been talking about how over 90 million americans have the opportunity to work remote at least part of the time so we're seeing our peak nights of growth on thursday and sunday night, which has really been driving that, that average length of stay that's been increasing and we think will continue into the fall and winter months >> i drove a long, long way, and it's fun it's fun i like the whole adventure of it i feel like chevy chase, kind of, like in the vacation movies. do you have chargers in any of your wyndhams? are you going to do that >> yeah, you know that is corcoknow, that is a tremendous opportunity that so many of our franchisees are taking advantage of and will certainly take advantage of in the years ahead. >> a good idea i say it all the time. people don't listen to me, though waffle house and chargers, waffle house and chargers. half hour for waffle, car's

charged. move on. such a simple solution sometimes the simplest solutions are the best, jeff thank you for coming on. you have heard that idea before? >> from you, yeah. so many times. >> there's waffle houses everywhere it's ubiquitous, everywhere g where's our waffle house here? >> waffle houses everywhere, maybe not here. >> everywhere but here okay coming up, best buy's report in the next few minutes "squawk box" will be right back.

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good morning worries of higher interest rates haven't gone away. the dow and s&p and nasdaq were at five-week lows and all but assure a losing august we'll get you up to date on what to watch for today's session and best buy's results expected in just minutes. we'll bring you the impact on the retail sector. and violent clashes in iraq and what it could mean for the oil markets. the second hour of "squawk box" begins right now

good morning, and welcome back to "squawk box" here on cnbc, live from the nasdaq market site in times square. i'm joe kernen with melissa lee. equity futures up209 points on the dow. pretty, i would say, yesterday's session was not horrific, as we've seen sometimes following a friday you come in on a monday. in fact, there is reason for some of the big selloffs we remember in the past are on mondays. and we didn't see that yesterday. in fact, midday i think the averages turned positive briefly. at least the s&p did here we are. s&p called up 32 that will put it back at 4,060 >> which is really -- >> which is what >> you think we're going to go to new lows. n . >> no, i don't i think that whatever you want to call it, the rally we saw

from june 16th, a lot of times when you don't, you don't have the intestinal fortitude to buy at 3600, those great nasdaq stocks once the train is back to 4300 on the s&p it's not going to back up and say get on board now that you feel a little better about things >> history tells wise dus we do make new lows. >> the last week shook my conviction that i was right about 36, you know, i, we have deferred comp plans. on june 16 i moved everything out. i'm not going retire on it >> that's going to be a clip that goes viral. >> doesn't take much

just cut out so that you can't look anything. >> retire. >> i'm going to tell people now. when jooibe biden was on, he to us i'm going to be joe biden the main street media took it that i'm going to beat joe biden. they call him demented and senile for a week saying weighs going to beat himself. none of them cared that's why it's is cesspool. >> we're talking about clips going viral. >> they don't care about the truth. >> anyway. >> but i digress let's check out treasuries 2.4 is the one i'm looking at now. 3.4 on the two-year, because that's the one that i think, you know, we've got to see that get above what have you use for an inflation rate and that might be, what, what do you think, 5%?

4.5? not 8.5. >> four. >> even if it's four we've got a ways to go that could put us over new lows. it doesn't have to happen before october. are you doing -- >> we're checking oil. >> oil recight now you're going to do it. isn't that weird it's going the wrong way, unless you are believing we going into a slow down. >> there's a guess that we're going into a hard landing. >> and crypto got under 20, fu's back above that now. 20,397 >> let's get to dom chu now with a look at the premarket movers >> we're going to put some of these moves in a frame for you because we like to put things in

context. anyway, some of the early morning movers here are centered around the mega cap. first of all we've got new developments in the ongoing saga between elon musk, twitter, and of course tesla kind of maybe in the cross harris here. twitter shares are down about a percent right now, this is on the heels of maybe getting some kind of a move lower based on new filing and a letter by musk's lawyers that's putting pressure on those shares meanwhile, tesla is up on a relative basis, because maybe some of that bounce back is playing as well. but also because perhaps tesla shares don't have as much relative pressure if there isn't a deal, perhaps, to buy twitter from elon musk so all of that dynamic playing out for twitter shares down about a percent. tesla shares up about 2% speaking of that mega cap trade, if you look at the bounce back a two-day rout

billions shaved off in terms of market cap meanwhile, the biggest names out that's there, apple, microsoft, all names up about 2%. you mentioned this whole idea that we didn't see a bounce back on monday, the turn around tuesday narrative is still in tact right now we'll see if that is out into regular trading. watch those mega cap names joe mentioned the bend but didn't break bitcoin trade around 19,600 to 700 were the lows yesterday remember that 18,700 mark is what we're watching for the lows we saw this summer so the range is still in tact. 20,412 is the last trade for bitcoin, but we didn't see a massive move lower in yesterday's trachlde

20,000 seems to be that line right now >> dom, thank you. dom chu. le let's get straight to best buy the electronics retailer earning $1.54 a share. revenue came in above analyst forecast comp store sales fell less than expected for more, courtney reagan. good to see you. best buy already indicated that it would be a tough quarter. the guidance forward, when you look at the numbers, they hlook horrific what to you make of this quarter in >> i think we knew quarter would be bad there's not a sign of real improvement. i think it's generally expected. le le

lekken >> courtney, what were you watching in this quarter >> yeah, exactly what greg was watching, too, and i think trying to tease out the ditch bet difference on what's going on with consumers the fuel and the food we need to eat and dealing with those higher pressures and what that means for our extra discretionary spending versus are we just not buying consumer electronics as much as we were because we had to stock up so much to learn from home and work from home. so i think trying to tease apart that difference for the sales could be important and greg's point about the inventory, i very quickly scanned the release. and according to my math, and i am not an analyst, so i'd want

greg to back me up on this but it does look like the inventories in fact are a little less than last year, down by about 6%, if you're looking at the value on the balance sheet it's a little over 6 billion and last year it was about 6.4 billion. so perhaps they've done a better job of cleaning that up. we know best buy has a pretty good operating team. she hones in on the financials of the quarter, so they do have that going for them in a very difficult environment. >> greg do you want to come at the inventory levels? >> great job i think the question is are there any early receipts there for holiday. remember last year, there were folks in long beach, so there was a scramble to get inventory. that will be the focus, you know, we like best buy here just because we think it's so cheap

and expectations are so low. but it is important to have inventories right. that is the thing. consumers are making choices and we generally prefer the pricing power stocks and retails. >> what's your number one question on the call, greg >> it's going to be how much should we expect margins to fall in the back half as we try to balance inventory and sales. now that's number one. and then for the consumer, are we seeing any sign of trade down or trade out which we're seeing in other discretionary categories the last three to six months >> thanks for your takes, greg mel ish and courtney reagan. we'll talk energy and opec after the break with halima croft. let's get a check of the markets. breaking two-day losing streak s&p looking to add 31. "squawk box" will be right back.

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developing story in iraq violent clashes gripped baghdad after an influential cleric says he's quitting politics a nationwide curfew has been announced and the government's cabinet sessions have been

suspended. the very survival of the state is at stake. meantime, oil prices are falling after notching their highest gains in more than a month after worries of output cuts natural gas prices plunged as much as 21% yesterday. the decline only brought price down to level last week. germany said its gas storage facilities are reaching capacity faster than expected joining us is halima croft, global head of commodity strategy great to have you with us. give and what's going oenoyn wih iraq and libya >> we've had protesters block roads to key facilities and

ports. as of now we don't have disruption but we will be watching in the coming days, do we see protesters entering facilities, do we see one million barrels of production come off line everyone's going to be watching iraq, but we don't have disruption yet certain very concerned, obviously, given the supply issues in the market right now >> what is taking one million barrels off the market from iraq do to the market >> this is an opec meeting where there are new questions. this is a really important story. iraq is opec's second-largest producer anything that would impact iraqi production would be very material to the market libyan production had rebounded

in recent weeks. so there will be big concerns there. >> i'm wondering what you think, the ecb is meeting september 8th. and i know you specialize in commodities. but this has got to factor in, in terms of what central banks are doing around the world, whether it be the impact on commodities or the impact on the underlying economy but the ecb, we're seeing nat gas prices tick so high that it is going to the five-year forward inflation outwork. i'm curious how you process that and how you think about your price target, seeing what the ecb is expected to do, which is a huge rate hike, you know n a win a week or so >> i'm at the conference in norway, the belgian prime minister out yesterday saying we may have to bring in price caps

for electricity because we have so much volatility in this market and dislocation between fundamentals and where prices r i'm in norway right now. we have the norwegians really stepping up in terms of raising oil and gas production they are now europe's number one supplier of energy they supplanted russia how much relief kncan norway proved energy-intensive industries are shutting down. we still have very, very high prices i do think it's not just, we think about rate hikes but what's coming in potential price caps from european leaders to address this rising electricity prices >> this conference is geared toward oil executives as i

understand i'm curious what their receptivity is, now they're going back on shutting down nuclear power plants is there a change in tone? >> this is a great question. this is a conference that has a lot of energy executives, oil, gas, renewables. a big focus was on transition, but now we're focussing on energy security. and the big question how do you balance your climate goals with energy security goals. elon musk was here yesterday and essentially said we're still going to need oil and gas. so what you're having is a more pragmatic conversation about what's going to be required in terms of investment oil and gas to bridge the gap in supply as we think about transitioning to

renewables >> there's so many things going on around the world and with economies, et cetera, and supply problems we haven't really talked much about hurricane season in the united states, and i'm wondering how you view hurricane season as the next sort of shoe to drop, potentially, in this whole energy picture >> there's been so much going on in terms of the russia-ukraine situation, what we're watching in europe. i mean, obviously, anything that could be, you know, disruptive to the u.s. energy industry, that is going to be an additional problem for this market and, you know, obviously, there are issues about lng u.s. lng played such an important role so early in this crisis which molecules could move to europe u.s. lng played a really critical role. there will be real concerns if there's any issues in export

cap capacity abilities >> thank you for joining us. >> thank you for having my >> many companies planning on workers returning to the office after labor day. but how do you coax those who are reluctant, and what should companies do to make the transition more smoothly do you come back or you're fired? that's one way you could do it >> the boss tells you what to do like now, when they're telling you to keep reading. >> and we've heard from best buy this morning ew charge point, pvh, "squawk box" will be right back. and, with our best price tee, if you find a lower price, we'll match it. with value like that, it's never been easier to sport your style.

california's legislature passed a bill yesterday that would a llow a panel to set fast food wages for workers they would set hourly wages of up to $22 starting next year

future wage increases would be tied to the consumer price index. gavin newsom has until september 30th to decide whether to sign or reject the bill representatives from mcdonald's, young brand and chipotle have all lobbied against the bill. >> people have said if you aren't going to pay a living wage don't be in business. >> then don't go >> then we would have no more fast food. but there are people on this side of things that would think that's a good means to an end, too, to get fast food out of business because it's so unhealthy and causes obesity and everything else. just about anything can be argued in this world today sony has set up a dedicated playstation, a mobile gaming unit to diversify beyond consoles but has faced supply issue. launching playstation studios mobile division.

it's going to run independently of the console business, also acquiring savage games the covid-induced boom during which people were stuck at home playing. so many reversals. >> exactly >> look how great it was going to be for so many different things and without the pandemic they're lost >> and looking back on it, it make complete sense. who would have ever thought -- >> not for the entire nasdaq to hit a high in the middle of a pandemic and then sell-off 40% when there's no more pandemic. that's perverse. >> it is but that was government stimulus, right in right? >> right >> flaiting everything >> we'll talk more about the

transition and what the new normal could look like but first we'll talk to kyle bass stay tuned you're watching "squawk box," and that is cnbc

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welcome back to "squawk box. looking at figures across the board. nasdaq is hire by 130 and the dow looking to be up by almost 200 points take a look at treasuries. the all-important two-year yield. it hait a level we hadn't seen since '07. as for crypto, bitcoin is hovering just above 20,000 right now t ha now. many u.s. workers, including those at disney, tesla and apple are preparing to work more days in the office after labor day. for more on this, let's bring in former "usa today" editor in chief joanne litman. she's now a yale university l

ele lecturer do you just go ivy to ivy? is that how this works at some point? >> i think i'm happy where i am, joe. >> okay, good. anytime in your intro, there's some ivy league in the name. how do you get people back and are businesses really gun-shy to try to actually, you know, say you have to do this? it seems like in the old days that's what would you hear >> right right. you know what's so funny, joe, when you and i think about this, right, if somebody five years ago or ten years ago offered us the ability to only show up three days a week in the office, we have been jumping up and down, like oh, my gosh, what an amazing perk and now employees are actually

protesting having to come in that often but look, the bottom line is, joe, that if it wasn't clear already, it is absolutely clear now that there is no going back to quote-unquote normal. there is no going back to just five days a week in the office period it's dead. at this point, two and a half cl years into the pandemic we're not going to see t theit there are a lot of reasons to go back that are legitimate reasons. culture, understanding, getting the mentoring that you need. if you think about, when i was a young reporter, i started out at the "wall street journal." the reason i learned, the way that i learned how to be a reporter was by listening to my colleagues in this big bull pen in how they were pooling their resources and the great questions to ask, the way to ask. and you miss that if you're not

in the office. so i get all the reasons why people, bosses in particular, want you back in the office. and they are legitimate. at the same time, the reasons why people don't want to go back are also legitimate, and we've got to pay attention to that i just saw a stat by nick bloom, whom oyou've probably had on and he said people just by not commuting are saving 200 million commuting hours per week, which is quite astonishing, right? so this is real time that people are getting back and the other issue, i think, huge issue that we're not paying enough attention to is the inequities of going to the office it's easier for some people to go back to the office. and if you look at the research, the people who are more likely to want to work at home are women, particularly women who have kids at home. people of color who have to deal

with, you know, code switching, who may live further away in different communities. you have the, a real, real risk if you're demanding that people come back that are you going to lose really, really valuable people and that the, and the other thing is, right, the people who show up, there's a thing called proximity bias, that you naturally are going to be, they're getting the opportunities, the stretch opportunities, the promotions. and so these are really, really tricky issues to deal with but the fact is, joe, we just can't go back to where we were i don't think we're going to see sort of, you know, that retro. i think the old ways are gone. >> there's nuance to all this, allan, but is there anything you just outright disagree with? joanne just said all good points what's the right answer? do you disagree?

>> don't necessarily disagree. joanne covered it at a high level. but let's get into the real commercial impact. data says that of those who commute, there are, our survey, 97% of those who commute say that they will work more from home than if they return to the office that's number one. number two, again, talking about impact, there's this thing called fiat quitting in the old days, you'd come back because the boss said come back. what's going to happen is those that want to come back, they're fine what we don't have to worry about them what we have to be concerned about is leaders who don't want to come back and how do they strike the balance and do what the company needs to do but we also do it in a way that they're relatively satisfied if not you're going to get a certain level of quiet quitting.

what's quiet quitting? every one of us has discretionary energy there's amount of work i can give you to keep my job, and there's the amount of work i can give you if i'm empowered. we have to have those folks empowered, really, really engaged, and that will mitigate the change from we had to work from home, we're losing some of the flexibility. i'm not so happy about that, but my leadership is making up for the gap, does that make sense? >> it does i don't know whether we have ai, allan, that can really do the math for us about some of the things joanne talked b coabout, commuting time that you said versus productivity that i would think might not be as high at home maybe it is, maybe it's not, but

how do you hook look at the offt there, and would we see down th road -- i would think if we went to a four-day workweek, there's just no way you're going to get the same amount of productivity out of that. >> the data is that 79% of employees say if they have to go back to the office they're going to work less productivity is about two things how much time you put in and how much outcome and results you get. honestly, i think early on, if we think back to a year ago we have good data on productivity what it showed is productivity actually went up for employees that were home two days a week and then leveled off so we didn't get a completely upper-sloping graph avevery day being home people home two days were more productive than thinkey were go

five days week bringing them back five day as week isn't going to improve productivity is what we know now. >> if i could weigh in on the four-day workweek, there is quite a bit of research done in other countries and a lot of experiments going on now but the biggest experiment was in iceland where they tried a four-day workweek and found that productivity either remained the same or increased during that time period. and importantly, that mental health and happiness and satisfaction with their jobs actually did increase. so there's other experiments going on now i do think the workweek is reasonable and something i think more companies are adopting and that we'll see more, we'll get

more research and results out of that in terms of going back, what ahan w allan was just talking about in terms of going back a couple days a week. right now it seems ash tempetrar e right now to be told suddenly you have to be here on x, y and z days, it feels like, why companies that are doing this most successfully are understanding that people in for specific reasons so they understand and the specific reason is not necessarily taco tuesday, we're going to have a food truck for you. we're doing this particular project. it's collaborative work. and there's particular research that columbia did recently that looked at creativity and it found that when you are trying to brainstorm new ideas,

zoom is a creativity killer. people are much better at brainstorming and coming up with novel new ideas in person. so there's a reason to come back in by the way, though on zoom, one of the other points is, on zoom, they also found is that when it came to picking which of those ideas, they're inclined to do that on zoom. there's certain tasks that zoom is great for and if companies sort of start to parse that and there's a reason to come in, that's going to be helpful instead of arbitrarily come in this day >> the last time i was on squaw you were talking about work at home but if we face higher unemployment, which is what the fed has effectively said, that we will have higher

unemployment, you know, at what point should workers think, you know, i want to stay at home, but i really should go into the office, because there might and proximity bias and when it's time to lay people off, i don't want to be on that list, because i'm off, you know, at home doing my thing >> so two things the proximity bias is real, assuming you've got the company whose buy jas tias is to have ne it is a massive talent shortage. it is going to be a buyer's market they're not going to chaenge th game people might be a little reluctant to push the envelope with the boss. but the reality is they're going to vote with their feet if they don't like the environment and i'm talking 18 months, employers are going to be disadvantaged if they think they have an upper hand on employees.

they don't the employee is the customer today. i have a financial services client, fortune 500 that early on decided to go heavily remote. that particular company let me know about two months ago that the jury is in they had record earnings, record revenue and record employee engagement levels. so there's a case for heavily being remote, and there's certainly a case for, i don't think there's a case left for, you come back to the office. i just don't see that case >> thank you coming up, the riding costs of term care that story is next and a reminder, for the best of "squawk box" follow squawk pod on your favote aripp and listen anytime. stay tuned

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kn inflation has now topped staffing as the main concern about the rising cost of long-term care according to a new study. the majority of americans over 65 are likely to need it, but many don't know how they'll afford it and don't realize that med care does not cover long-term care services. >> reporter: stan horowitz's family didn't have a plan for his father's long-term care until there was a crisis >> july 4th, 2016, his life changed in a big way >> reporter: that's when his father fell, setting off a cascade of medical issues. he was never able to return home and moving into an assisted living facility drained his savings. already the national average cost of a nursing home is over $100,000 a year. and few long-term care insurance

policies have unlimited coverage for a new policy with $165,000 benefit, a 55-year-old could pay $45,000 in premiums by the time they turn 85 >> long at any term care is just so expensive >> reporter: tom beauregard returns when his parents were in their 80s. dementia and heart disease required them to have daily care, but they didn't have long-term care insurance to pay for for t >> you need objective experts to help you understand how to make transition plans, how long you can keep people at home safely what kind of services can you bring in >> reporter: and how to pay for t from traditional long-term care insurance to hybrid care products that provide a death benefit if care is not need. there are also inflation riders that can increase up to 5%

avenue year. without insurance, stan horowitz's dad must now depend on medicaid to pay for the care. what would you do differently now? >> i would have that hard conversation with my dad about his manniplanning and finances. >> stan's dad is now 93. he's 61 and has already planned for his own care plans >> what a difficult topic. more and more people are dealing with aging parents in need of long-term care does that mean demand for this kind of insurance is also going up >> well, you know, melissa, the cnbc producer and i wanted to report this story because we're going through it personally. so many people are going through these issues in their families what we're find something we are going to have more older americans needing long-term care

service. by 2030 all baby boomers will be over 65. by 2034, older adults will outnumber those who are under 18 we're seeing a hot lot more variations on the kinds of policies some that allow to you build up investments to pay for long-term care if you don't figure it out, can you deplete your savings pretty quickly. coming up, kyle bass joins us to talk china, the markets and much more. let's get a check on shares of twitter. elon musk's lawyers sending a le

letter in the letter, musk and his lawyers said the allegation of mr. zatko's recent whistle-blower report if true would violate certain conditions he merger agreement. "squawk box" will be right back. at fidelity, your dedicated advisor will work with you on a comprehensive wealth plan across your full financial picture. a plan with tax-smart investing strategies designed to help you keep more of what you earn. this is the planning effect. power e*trade's award-winning trading app makes trading easier. with its customizable options chain, easy-to-use tools, and paper trading to help sharpen your skills, you can stay on top of the market from wherever you are. for your consideration, and the world's most help innovative eyewear,, turboflex. turboxflex frames are engineered with a 360 degree hinge disguised in the design.

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the markets, let's bring in jason brady, president and ceo at thornburg investment management jason, thanks for joining us this morning let's, we're all still talking about what happened on friday. i have people telling me that j. powell couldn't have been any clearer about what the intent was about inflation. i have other people saying, yeah, but they haven't really had to dispense that much really hard medicine yet. and, you know, when the going gets tough, they're, you know, they're going to probably not be as courageous as they need to be where do you stand >> i think the fed is embarrassed. and that's worst thing that can happen to a public official. it's like they held a labor day barbecue, and everybody showed up they a deep frozen steak and they threw it on a super hot grill and now the meal doesn't taste so good and everybody's looking around saying, gosh, i

really really wish we could have brought this economy out a little slower. and when you look back at a time when a fed official is embargs or the history isn't so good, people are talking about arthur burns over and over again. that was an inflationary challenge. clearly we had a number of officials oversee recession. that's been a problem of course but damaging to a legacy but nothing like letting inflation get out of control like this so i think they'll stay the course much more maybe than was thought on thursday. >> we could talk about your background, but you do try to help clients with a total return are you seeing opportunities in, i don't floknow, dividend-payin stocks? what do you think you can deliver safely to people >> there really have much more opportunity for balance in

portfolios in ways that work so not only is that in the context of allocation, i mean, great. it was terrible before, now it's less terrible, but actually there's really good vallouues we like maste mastercard you want to have a bunch of different things working in this environment. the one place i really don't like is sort of a, hey, it's down 80% it must be good kinds of names that's not where balance is in the market right now >> jason, we, we had the, what happened on friday and then we had yesterday, which was kind of constructive now we're up today i don't know if it holds. but would you take that performance, given what j. powell said, and what, we don't know the counter factual, if

they had seemed very dovish. would we have been doing better now if the fed had shown it was going to blink i think maybe we should thank our lucky stars for what j. powell said on friday. >> i think you made a great point. in the near term we say oh, gosh, they caused the market to go down. but we'd much rather have them be credible. the steak tastes bad that we're eating but at least we've got something to eat i think we going to have some volatility we've had it all year, that's not news, but i think for a while the market sort of felt h like hey, the worst is over. maybe the worst is over, i'm not shur sure, but i can el itell you the volatility is not other. the only thing i'm a little concerned about, now the fed are actually openly saying hey, we need the market to go down

i think the fed's gotten themselves into a trap trying to talk up and down the market. it's just not an institution really equipped for that >> what would you do over the next week or month for the money that, let's say you had new money. what would you do? >> it's as simple as putting it together in a portfolio that has, again that is correct balagain, that balance. that are going to provide some really interesting income that lightens the load on the fixed income side and gives us something where, look, we're not trying to get rich quick here, we're trying to get rich slow, and that compounding is really powerful >> all right, jason, useful. you need to think about reward, but you've also got to think about what might happen the other way, and that's what some of this smaller beta stuff might

be good. appreciate your time today coming up, hayman capital kyle bass on what he's seeing in the market, his take on inflation and more mu plus montana senator ste daines "squawk box" will be right back.

good morning t bulls look to bounce back. our special guest this morning, kyle bass. the call to consumers best buy. it is seeing signs of inflation-weary shoppers pulling back on spending the final hour of "squawk box" begins right now good morning, and welcome to "squawk box" here on cnbc, live from the nasdaq market site in times square i'm joe kernen along with melissa lee. becky and andrew are off today equity futures were up more than 200 on the dow earlier

most of the gains up about 180 the nasdaq up 113. and the s&p, that put it is around 4,000 we're starting to pay attention to the two-year convert. >> mux smusk said in early july he was pulling out of his deal to buy twitter he has additional conditions tor pulling the deal he says the conduct alleged in the whistle-blower account would impact twitter business. the fda expected to authorize new covid boosters aimed at neutralizing omicron

variants the approval could come as soon as tomorrow. let's get to dom chu >> we've got three big earnings stories driving the premarket action on the retail side of thing, best buy higher by roughly 2% just around 70,000 share of volume right now they report bet areter than expe profits and revenues best buy did see those so-call the comparable store sales decline across all major product categories with more significant declines in home computing and home theater products. those shares are still up 3.5% big lots up fractionally, but roughly 15,000 share not a huge amount of activity. this is now hikelikebest biuy

and then baidu, the china-based internet search engine often called the google of china helped by recovery in demand for computing services they might have a sympathy move for a lot of these other chinese internet stocks. keep an idea on baidu. it was penpinduoduo yesterday. joining us, kyle bass. what are you doing in town >> seeing some friends and

hanging out with you >> what have we not talked about with you there's usually something that you're -- disturbed isn't the right word, but you've got your eye on what could be a complete -- what kind of storm could it be if i can't say that word complete excrement storm over in europe in terms of energy and they've dug their own, the situation they're in, i'm mixing met a metaphors, but they brought this on themselves. >> the desire to engage in alternative energy is something we'd all like to see, but there are certain narratives that get pushed by ngos and teenagers, and we've been taking policy cues >> greta >> and i think it's important. look, i launched a conservation-based private equity firm last year.

i care very much about our planet, don't get me wrong just because i'm from texas doesn't mean that i love oil and gas, but there's this duality. you have to have more oil and gas for a longer period of time than everyone believes for us to get into a proper transition policy and even jamie dimon said it the other day. you need to get it through your heads that demand for hydrocarbons is inelastic. >> can you see where a major amount of our energy doesn't come from, what do we get from renewables, now, 3 s%? >> we've been all in and it's still single digits. these moves take 40 year the move from coal to natural gas took 40 year they take a very, very long time we can't just flip a switch. we believe you won't see any kind of decline in organic or

inelastic hydrocarbon demand south of 2037, 2040. and that's if we really adopt these things at record pace. >> are we full botre in this country? obviously, there's supply chain issues with part, labor issues, we can't get guys on the rigs. are there still hangover effects from government policies and overregulation are there still hangover effects from oil ceos not wanting to commit long term because of uncertain an uncertainity >> they do have targets. and the net zero sector is trying to shame them into going green or black and so all of these policies continue to roll

forward, ie the big oil companies to meet their net, net zero neutrality targets, they're going to have too actu be selle. institution continue to pull back the family offices in some private equity firms are leaning in but not enough, joe we need much more. >> in terms of what's going on in europe and soaring energy costs there, how do you see that playing out? is there a trade that you're in, an investment that you're in that sort of gives us a glimpse into how you see is it a recession? is it, i mean, what's the trade there, kyle? >> yeah, i mean, if you look at let's just say germany, what it spends as a percentage of gdp on energy, what used to be 1% is going to be 8.5%, 9% those are enormous moves in the macro world for what they're

going to be spending fan and if putin decides to do something crazy this winter like unplanned maintenance on norm stream, i don't know when we have electricity shortages prices move exponentia exponentially. people are going to go without heat this winter people's bills in germany and france are going to go up eight to ten x imagine your energy bill moving eight x. >> a noshort a time >> i think you're going to see friction happen in society. >> that's what happens, i don't want to say often, but oftentimes the roots of civil unrest lie in huge spikes in

inflation of some sort, whether it be food or fuel or a combination of both. how do you see this playing out in a developed snanation >> it will help in the developing world and the emerging world the lng cargos are being bought by a developed world that can afford them. japan competing with jeurope t and it prices out africa, the real poor. if you poll this follow this i to end up starving the poor children of the world and killing them it's counter intuitive that that could actually happen, and that's what we're seeing with the prices at $1,000 a mega watt-hour, you're going to see

real problems in europe. i can't believe it's not on the front page of every paper every day. >> we are fat and happy. advanced society and a lot of that is due to hydrocarbons and the life that it's allowed for us. and if you're going to change that quickly, and it may already be happening are there going to be, i mean, real disturbing things to watch in europe? you think rationing, people not being able to heat their homes, food problems. you mentioned in the developing world how tough it could be. >> yeah. >> these are all possibilities, aren't they? and then did you see "60 minutes" fmin minutes" if they knock out a grid, a bad actor decides to do something to our grid, you're going to learn about loss. >> let's not go there. let's stick with, you know, the macro, as it stands today, is hard enough. >> but there's black swans

we had a pandemic that didn't happen in a hundred years, right? a financial crisis that didn't there are things that make us realize that we take a lot for granted. >> this hydrocarbon policy has been a slow burn until putin's invasion of ukraine. that accelerated the problem and what he's tdone with nord strea. has he been planning this for a long time? one could say this was a long-testlo long-term plan this hydrocarbon plan is a multi-year problem those numbers are absolutely astronomical this isn't just a winter of 2022, we'll figure out how to get through it, this is something that we as a developed world must spend more money and more effort and spend all of our

focus, i think, on small modular nuclear, because that technology work, and it's actually very clean. >> are you an investor in nuclear right now? >> i'm not >> you're not. how do you, i hate to just say boil it down to a trade, but how are you investing in this th thesis >> i think owning the producers of oil and natural gas is a very interesting proposition for the next decade or so. if you hook at tlook at the for curve, it is suggesting gas prices come down $4. but europe and japan and asia aren't going to have a decline in their lng demand. as the u.s. exports more and more lng, u.s. gas prices are going to stay elevate. >> policies in the united states specifically but also in europe

that require these oil and natural gas producers to go more green and to do things that they otherwise would not specialize in that's not there foir forte is there some sort of discount in their shares right now? how, i wonder if there's, you know f you e know, if you eliminated that >> if you look at the prices of h hydrocarbons out one two, three year from now, there's a massive decline in price, ie investors factor that into their models. i just think the prices are wrong. we going to take a break but shift gears into other subjects. we're fine with china again? pelosi thing, forget about that?

what's going on over there can we go through the straits of taiwan, no problem right now >> well, we've, i think we're talking about sending another frigate through, but we've run that straight. i think we've transverse thad sttransversed that straight about seven times >> more to come from kyle. senator steve dancines is up ahead. first we head to break and check out this morning's biggest premarket winners and losers stay tuned you're watching "squawk box" on cnbc

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. twitter now responding to elon musk's second notice of termination of the merger agreement. we told you earlier in a new filing, musk provided new reasons for ending the deal, citing new allegation from a whistle-blower new twitter says it has not breached any of its obligation

and says musk is not likely to suffer a material adverse effect we will speak later in the hour with a legal expert. i use that in the loosest sense. no, this is a good one this is a good one >> very unkind toward our expert from wall street to main street, there's lots of talk about so-called esg investments, and washington isn't sitting quietly by joining us is steve daines he introduced legislation this summer aimed at protecting investment funds great to have you on the show again. welcome back >> thank you morning. >> good morning. you say there are many studies that say investing with esg in mind doesn't pay off as well i'm wondering what studies they are and if can you just sort of lay the ground work so we can understand those who have retirement funds invested in this style are missing out

>> if you think about a retiree, they're primarily interested on return on investment, growing their portfolio, and that requires a focus on fiduciary responsibility and rate of return versus appeasing the woke left in some of these esg priorities the bottom line is, as we look forward, and we're seeing this right now around world as we're seeing the energy crisis unfolding right now in europe. the energy inflation we're seeing in the united states. you go back to policies that governments put in place, techn particularly germany, starting to shut down coal plants and liber electric prices are ten times what they were a year ago. europe is in real trouble, thse kind of esg policies where you have woke government leaders putting pressure on companies to adopt these woke policies to

shut down, you know, carbon-type sources of energy which are affordable and reliable, their is a huge problem, and it creates risk as it relates to financial return >> i understand that in terms of you're a retiree, and let's say you're sitting in the state of new jersey or new york or wherever you want to site, are there certain retirement funds out there or a number of assets that you know of that are an investor in esg and you can say these investors are not getting as full returns as they may have if we able to ignore esg >> yeah, we, we encounter those challenges as we in the committee that i serve on. the finance committee, the banking committee. are they making an investment solely based on what's best for their shareholders versus this stakeholder craziness. it's the sheareholders that

ultimately matter. when you own a stock, you're a shareholder. our responsibility is to our shareholders to maximize return on investment. >> sthisn't that what it means, though as somebody who's a chair of a firm in the state, doesn't fiduciary in itself mean their primary interest is return on investment or should you go after the definition of fiduciary as opposed to specific policies? >> you're exactly right. it's the return on investment. and the challenge we face is these stewards of these funds, retirement funds as an example are basically trying to earn brownie points with the left and their woke agenda which is solely focussed on fiduciary responsibility that's why they'll say climate change is the greatest financial risk we face moving forward, that moves into a political

discussion versus where's the best place to invest the dollars for retirees to make sure they maximize their investments and return on investments. >> senator, kyle here. when you talk about, you can separate the politics, actually from the fiduciary role, right, and i realize there is a political argument here. but you think about the fiduciary role, you're right when you say retirement funds and/or endowments and pensions aren't making investments in hydrocarbons because their boards are subscribes to this policy of wanting a bert tter climate, but if they strictly followed the rules of their fiduciary responsibility they would have to be investing in things that had that return. >> that's precisely the outcome

we want to drive here with these policy change. you look at what's going to go on in the world of course in the next 30 years, wbetween now and 2050, the demand increases 50% oil, cogermany in fact had to ps a law in the last two weeks allowing coal plants to come online for the next couple years to try to bail germany out that's exactly what needs to happen when it comes to fiduciary responsibility for retirement accounts to focus on what is the best thing for return on investment and to go forward here, oil, natural gas, coal, these companies are going to be doing very well going forward, but the stewards on these plans should be solely focussed on what's best for their shareholders, not what's best to apipease some green

ideological agenda we should view renewables as expanding, not replacing base load power that's precisely why germany and europe's in the crisis they're in today because they radically moved forward on these left ideological green energy policies, and now the people are suffering across europe, and they are facing a huge energy crisis as they enter the winter. >> senator danes,ines, great tov you with us. >> thank you >> we want to mention that blake kernen is part of senator daines' staff. >> she lives in d.c. she loves it elon musk filing another letter we'll talk to kyle bass about the most likely outcome. and a reminder you can get the

best of "squawk box" on squawk pod. listen anytime we'll be right back.

while higher interest rates, slower growth and softer market conditions will bring down inflation, they will also bring some pain to households and businesses >> that's not the signal that j powell is sending. >> we will keep at it until the job is done. >> is europe going to be in such a difficult economic situation that they don't go forward with those sanctions? >> back to school will be a good bellwether for how holiday spends as well coming up, breaking news out of china today the country's ruling communist party announces plans to hold a key gathering in october kyle bass is here. meanwhile, u.s.-china

tensions grow over a debate over taiwan a live report from beijing is next and he's here, kyle bass, what he makes of it all and tttwier comment, too not for tweeting but about twitter. "squawk box" will be right back.

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welcome back to "squawk box" on cnbc. taking a look at futures, we are looking at a higher open across the board but have lost a little bit of the gains we're seeing the treasuries pull back just a touch. anyway, treasury yields have pulled back a little bit from yesterday's level. two-year note, 3.448%. yesterday was the highest level since '07. >> china's ruling communist party will hold its congress starting on october 16th the gathering happens once every five year, and with us, kyle bass wrap it all in to what were you starting to say earlier. how long's it been time flies, doesn't it, since the pelosi visit

and are things fund. afundamountly changed? >> where're in a new era china use pelosi's visit as ratchet. as she said in a speech, peacefully or else the question is do they invade, do they invade in the next year or two or the next three or four and what does that mean for our reliance for chips and antibiotic production and blood pressure medicine. there's things where there is such a dee p reliance but we hold the economic nuclear button in the united states. china still use dollars to

interact with the rest of the world for the overwhelming of their transaction. if china's belligerence gets to a point where we remove them from the s.w.i.f.t. system, those are the things that i think need to be socialized in our government >> do they wait until they build up their parallel s.w.i.f.t. sis them in. >> system >> it's like the old axis of evil if the bad guys want to hang out on the bad block there isn't going to be enough s.w.i.f.t. system for the bad guys to operate. i think their reliance on the globe is still going to be tantamount to their success and

their global primacy is something they've convinced some academics in the u.s. that some of the think tanks and even so wall wall street analyst. >> they have so much leeway, kyle, and i think we're in an api appease, not a confront mode and i don't have to look any further than, i don't know who do you want to talk about. >> 650 million basketball fans in china the houston rockets guy, you're down in texas. what did he say? >> he wanted to support democracy. god forbid >> the slightest thing g >> i don't want to pick on the nba, but name your multi national name us en masse as a country that needs those billion and how many ever consumers that you want to count that we need, so what kind of power do we really have we don't have any?

>> you know, churchill said going into world war ii, he's famous for his comments from 1930 to 1935 and being the only one in the uk parliament saying does anyone see what's going on here germany is looking to become the equal number of planes and ship, they're not supposed to be doing this and is anyone paying attention? and at some point in time they had to pay attention to what was going on with hitler and that appeasement, i'm rereading this book. the parallels to the buildup into world war ii to now, i'm not saying we're going to world war iii. i'm just saying that the vested interest with u.s. and uk investment into, let's just say the aggressor, the parallels are shockingly similar and the appeasement that's going on to a country that both of the

last two secretaryies of state said are engaging in genocide and engaging in organ trade. we really like profits and cheap stuff. but at some point in time if we were a smaller country we would have already stopped trading with them. the appeasement, the investment and kind of the capture that china has of all of our business and all of our wall street heads, and really our universities and our academic institutions is frightening, and that is their nrestricted warfare that they engage in. and the good news is, is they're not polling so well in the states anymore they used to be a very high favorability rating. it's very low now. they're polling around with congress people and journalists, right? they're in a new place

you asked if we're in a new place. we're in a new place >> in terms of an invasion, though, you say we have the nuclear button do you think china does invade taiwan or doesn't invade taiwan >> you mean the economy nuclear button. >> yeah, yeah. >> if you look back to xi's speech last summer, he gave a speech to the poe lit bureau where he said his life's mission is the rejuvenation of the chinese race that's to say the merger of taiwan and china once again fan he doesn't achieve it his life will be an abject failure. he is committed to taking taiwan the question is will it be peacefully, which clearly taiwan and the 27-odd-million people who live there don't want china's rule they just soughtaw the movie th played in hong kong and i don't

think they want that system. what does the developed west do about it >> some would say russia's invasion of ukraine was sort of an important test of what u.s. response would be in this scenario after, after russia invaded ukraine, there were a lot of people saying oh, you know, what could be next is china's vaccin invasion of taiwan do you see that as some sort of playbook >> i think the pattern is set. if you go back to the february 4th press release that putin and xi did together 20 days before putin's invasion, putin endorsed the reaction which significance of the chinese tseparatists and xi say we approve your conduct and if you listen to his speeches and to the poe lit

bureau, he tells you what he's going to do. the question is when >> can we talk about twitter >> yes, we can >> what are your generic blanket statements about what are happening? it's nice to be anonymous, half of it, it's slanderous, is it libel or slanlder? >> it's slander. libel is newspaper >> they put up graffiti. but half of it doesn't matter. anything goes. it's despicable. maybe, does elon want it to clean it up? and i'm sure it is full of, it's a complete cesspool. >> so i don't know elon. i love twitter i think it's tv for, for educated people. i use it -- >> people on twitter are not educated >> i use it as a funnel to follow the people that i think are the smartest people in the world and not follow the people that aren't.

>> you follow me >> yeah, of course i follow you. so i think it's become the global public square that's what i believe. >> but it's got some problems being the public square right now that elon identified, sort of made an impulsive move to say i'm going to clean this up and got stuck with a $44 billion albatross. >> i think elon's smarter than that if he was trying to clean up and get behind the scenes, the data on what percentage of daily active users happen to be spam or bots or foreign operators, i think elon's closer to right than twitter's right elon's saying closer to half of the daily users. i looked at when david faber wa talking and some of the postings he posted on this issue, it looked to me that 70% of the replies this there were bots, pseudonyms, they had joined

twitter, '20 to '22. they had followers and sowing the discord. the bots are jumping on and attacking. they attack me all the time because china runs a very large misinformation campaign in the u.s. so does russia so does iroan i'm not a great study case because of how they attack me. musk, through discovery, is going to figure this out and figure out how many, how many of these users are actually bots. >> that's the troubling thing. we talking about hijacking public opinion this is the problem. foreign actors hijacking public opinion. we'll have much more on twitter in just a minute, plus jim cramer will join us from the nyse but first check out this morning's win rs and losers.

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welcome back to "squawk box. the futures right now. we up 200. we're up about a hundred this morning. let's get down to jim cramer at the new york stock exchange. everything working down there? you got your camera, your audio? >> yeah, i've got my tin can talking to faber

i tell you, i like the fact, i didn't want the futures up 200 i mean, geez, you have all these people coming out negative about tech heat-seek missiles on the semis. truly depressing research today. nobody's like on that is correct you that, you know it's time to do some buying. >> i think we're just starting to believe that the religion has been learned at the fed and company. we've got to get used to this. they learned from history books about the '70s, and i think that's going to be the default had move >> it all changed. it all changed >> relief with commodities i don't know talking about oil. you think oil stays above 80,

jim? >> i think that the russians are pumping like mad they're making more money, i think, than they did before the war, which is really unbelievable that wooee let, th the council of nations accepts that, it's terrible. and we give so much less to ukraine i got into some fight on twitter where some guy said zelenskyy's a coward, ukraine should be let to fall. i thought that was almost anti-democratic. i think there are a lot of people who don't care about ukraine in our country they should be given more. but the russians are keeping oil down because they need every penny they can to finance this war >> yeah. kyle pass thinks twitter is the public square. i mean, i think it's the, we can point to it as, for the decline of western civilization. >> de blasio public square

see if he likes that i like him maybe he gets it there he is. >> he gets it. he knows what i'm talking about. >> good to see you, jim, how are you? >> good to see you love it when you're on >> look, i think twitter is a really important part of life today. the only social media i embrace, but i do think there's got to be some guidelines and some rules and some bumpers put on foreign influence in our country >> amen, i totally agree with everything you just said every bit of it, thank you >> we will, god willing, see you at 9:00. and then tonight on "mad money," don't miss jim's conversations with the ceos. and cnbc's delivering alpha,

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new this morning, elon musk's legal team filing at notice to twitter in an effort to terminate his bid to buy the company. the letter cites a whistle-blower of extreme egregious deficiencies twitter has responded saying it's not had any misrepresentations and said musk has not suffered and is not likely to suffer adverse effect. links bring in ann lipton. what do you make of these new claims brought by elon >> they're not entirely unexpected after having seen the whistle-blower to begin with what is interesting here is that this case is very far along. and this is essentially presumably to open up an entirely new basis for musk to

terminate the agreement. originally his basis was about bots and spam and these are completely different and presumably would require an entirely different discovery process. >> if you're trying to read into this, do you think that musk's legal team, they're losing faith in that original scope and now they're opening up this new avenue because they see maybe they won't be successful >> well, i mean, yes and no. even if they had faith in that original scope, it would be odd to have this new set of stuff and ignore it but i will also say their original basis for terminating was looking shaky based on this report that they're relying on endorsing twitter's version of the bot issue. it's a way of saying if this guy is reliable, i guess he's reliable about this other stuff

too where he agrees with twitter that the monetizable figure is correct. >> it sounds like in your view they have to go down this new path they said, we're not going to win on those grounds so we're going to open up this new avenue. >> i mean, i think that it may very well be right it's -- again, it's hard for them to literally look at this whistle-blower and say we're going to ignore this and go ahead with the trial but it is risky in that the whistle-blower confirms twitter's version of events or basically everything that they've been litigating up until now. >> why do you think that the judge was really stonewalling or allowing twitter to stonewall in the discovery requests i found that to be odd if his main point of action is trying to figure out how many of those daily active users are spam or bots, why do you think the judge reduce allowing twitter to stonewall him. >> i think it's

mischaracterizing saying that she allowed twitter to stonewall at all she thought it was sufficient for musk to test his claims. in particular, one thing she did order twitter to hand over was a little bit more basically the accounts it had sampled in the last quarter of 2021 so i think her judgment was that twitter handed out a lot of information and wasn't stonewalling. >> professor, great to have you with us. thanks for sharing your thoughts on this. >> no problem. >> ann lipton from tulane. kyle, do you think that ultimately the deal will go through? >> i don't know how the discovery is going to end up based upon my own news, i agree more with musk than i do with twitter on the amount of daily active users that aren't real and that essentially are foreign. but i may be a bad data point because of my stance versus

china. >> and just for transparent, you have no position in twitter. >> that's correct. >> okay. >> google just getting some -- >> i saw that. >> google hasn't approved truth social because of insufficient content moderation we wouldn't want that. or they disbanded that whole ministry of truth in the biden administration now it's just fallen by the wayside. been totally disbanded. >> i think that's a good thing. >> when we need it more than ever if we're going to return to 1984, didn't we, we needed that? >> we had something called the ministry of truth in this country. truth social isn't going to be the public square of -- it's going to twitter >> i think twitter will continue to be the public square. i think at some point in time, again, i keep going back to china, but china has 90-plus official accounts on twitter,

official representatives on twitter and yet they still block twitter from the masses in china. why do we allow them to spread their propaganda here where we don't have the capacity to do so over there it doesn't make sense. we keep opening our country up to attacks in all the ways that we're attacked and propaganda is a big one. we don't have a propaganda department in the united states. >> but the issue that you're talking about in terms of the bots being in control or launched by foreign actors, that's a separate -- we have the official accounts of the chinese fu officials but we have this army of bots that are unleashed to hijack public opinion on divisive issues. that is powerful, right, to divide the american people on whatever the top -- it could be abortion, it could be january 6th or whatnot. >> you see it on all of the key divisive issues that are mostly political issues, whether it's abortion or january 6th or blm

or straight politics in america. that's where you see the bots really focus their attention and i've spent enough time on twitter to really understand or try to understand better how they're trying to spread that discontent or that discord and so sow that discord in america and at some point in time, we have to start pushing back. >> you do manage money and, you know, you must be able to look at twitter's business. do we make it a public utility it's never going to make the kind of money -- maybe it does 44 billion is a lot. what's the business model for twitter if you think it's important that it stays in business, how would you ensure that given that -- how would you turn it into a more profitable enterprise. >> i mean, i would -- again, i don't run a bidsusiness like this -- >> you have to decide whether to invest would you invest in 20 if elon

was gone >> at 20 bucks i think twitter will live as the global public square i think that you could charge the blue checkmark users that are prolific users a business fee and i'm pretty sure everybody would pay it so you could really ramp revenues once you clean up the bots, the spam, the foreign influence and start -- >> no. >> you wouldn't pay? >> i would turn it off. >> i'm not sure i believe that >> i'm barely staying on for free at times. i guess there's -- i don't know, something useful comes across the transom once a year on twitter. >> once a year come on. >> there's things i see during the show maybe it's funny, maybe it's -- >> sometimes you can see what the chatter is for -- >> as a news feed, you'll see something. >> might look into that. we've got a minute and a half.

your highest conviction trade right now is what? >> it's two things, it is being long hydrocarbons, oil and natural gas -- >> companies or the commodities themselves >> both. i own more of the commodities. but i know the individuals that -- the mass audience here probably has to buy equities so i own both. but i think, you know, i still think that china belligerence is going to cause the taiwan dollar to break its peg to the u.s. dollar we maintain that position. >> did you hear the orson wells story that taoook place in harry's. >> churchill is one of the funniest people. >> he was an amazing man. >> he really was and it's hilarious thanks. a final check on the markets. i think it was on -- i didn't

see it live. you should watch it too. >> i'll google it. >> we have a hundred points upward nasdaq, about 75 s&p indicated up about16 keep watching the two-year we're watching it here i'll see you tomorrow. >> i'll see you tonight. i'll be on "fast money" tonight at 5:00. >> join us tomorrow. sq"squawk on the street" is nex we hope. ♪ >> good morning. welcome to "squawk on the street." i'm carl quintanilla along with david faber and jim cramer oil settles down and the cost of european electricity comes down. officials say the storage efforts running ahead of schedule home prices up 18, but that is a june number. road map begins with a quarterly beat for best buy despite an uneven sales environ