number we'll see what happens >> september and october, both coming >> september's already gone almost >> so far, so good we'll see. >> we'll see meantime, make sure you join us tomorrow "squawk on the street" begins right now. ♪ good monday morning, welcome to "squawk on the street." i'm carl with david at the new york stock exchange. cramer is back today in seattle. more on that in a moment in the meantime, futures looking to add to last week's gains as we await cpi tomorrow. we assess this reported progress in ukraine's counteroffensive. nice gain in euro dollar today, big week for industry conferences, a road map begins with stocks in rally mode, eyeing a fourth day of gains, ahead of that key inflation number this week plus, continued chip crackdowns, the white house reported targeting new curbs on semiconductor sales and equipment makers who help you

make those semiconductors in china. and twitter and musk's arguing the whistle-blower did not breach any of their obligations. jim, great to have you back. you missed you all last week what is going on out west? >> okay, so, today, we have amazon web services. now, what's interesting about this, carl, is we're going to cover both sustainability and digitization, and then later on, we're going to have expedia, again, it's about digitization and let's not forget tomorrow is starbucks, and then we've got costco >> that's a line-up. there is so much going on, david. all those names, some of them at code, and we'll hear more from media this week out west >> yeah, in fact, i'll be traveling later in the week as well, because as you point out, this is a big week, as you also

know, jim, for conferences you know, one of the questions, are we going to start to see some color in the current quarter from a lot of companies that might mean taking in or revising estimates based on current conditions or not? but we're in the heart of conference season. and goldman decided to move their conference from right down the road here to san francisco, but that's okay. >> well, david, i'll tell you what i find most interesting about this moment. when you're away for a week, you figure that you have a gigantic week and you follow it every day. some bears would be converted into bulls but instead, david, what i see are many people just saying, it was a phony rally. they're going to give it all back earnings are bad don't get sucked in. well, if that's the prevalence, if that's what everybody thinks, i want to take the opposite pitch. i want to go long. >> that is interesting i know it was wells on friday, david, said, we counted 25

industry conferences in the u.s. this week alone, no major earnings warnings as a result of any of them, which they take as a positive signal, but obviously, anything can happen in the coming weeks. >> yeah. i mean, jim, you know, that is the refrain, of course, of those who continue to be negative on the prospects of the market, that we are going to see significant revisions in earnings as a result of the so-called slowdown in the economy and therefore the pe multiple, while seemingly lower than it has been, is actually not really low >> right okay, this -- this is at the cusp of what i'm concerned about. let's take semiconductors. it's absolutely true that interviewed nvidia is too comprehensive. amd has just started coming down in valuation, but it's also true from peak to trough, this has been a worst semiconductor peak to trough of the last decade so if it's so, so negative, well, didn't that somewhat be reflect, david? i mean, come on.

the stocks we're looking at are selling at low multiples but more important, to have the smh be down more than 40% and now starting to worry about semis? you used to talk about it all the time, david. what value added is that what are the analysts telling us after a decline like this? >> yeah. typically, they're looking back, not forward, and they're often useless in terms of really getting a great sense as to where earnings are going to go but jim, this is still a very uncertain time there's no doubt about that. it's always an uncertain time, no matter what, but even more so now with so many of the cross currents in the economy that we have and questions about what their true impact of higher rates are going to be and the fact, obviously, that the fed is committed to not just taking them to a higher terminal rate but keeping them there i don't know i mean, when you're -- you know, when you talk to ceos of cfos, don't they seem to you to be less confident, perhaps, in their own forecasts than they have been? >> well, yes and one of the things i want to

go back to what carl said. they are worried, but if that's the case, why have we only seen just a couple of significant misses mccormick was a miss, the spice company. newel was a miss and then, i don't know, you could call bed bath a miss, but that was a while ago if it is so weak, and if everyone's so worried, why not slash right now? why not just say, you know what? things aren't good that, i'm not getting. maybe there's some hope. there's some hope, by the way, when it comes to europe, because of the ukraine offensive, that is become, i think, front and center in why the market could rally. >> yep we mentioned some of the euro strength today euro dollar up a percent, that's staying about six months eur european nat gas, one month low. germany today saying storage could go to 90% and then a bunch of, obviously, hot takes on what

this means for putin's image as, you know, of competence and stability and whether or not he's going to start to get some pushback internally, not to mention the operational gains that ukraine has made. >> don't want to be too historical but in the war against chechnya in 1994, led by yeltsin, there was a terrible defeat and one of the reasons is because the chechnyaens united against russia when chechnyaens abandoned chechnya and went with russia, i believed from the very beginning that putin felt there were many russian supporters in ukraine. major misjudgment. and then he felt that the government would collapse. major misjudgment. he also felt that this war would be over quickly because he wouldn't want to talk about it as being a real war. he wanted it to be a police action all these things, carl, are cutting to the belief, i believe, that europe, the euro dollar, may be bottoming, which would be incredibly important.

one anecdotal evidence you go to a shoe store in italy, it's bogo. it's two for one for -- everywhere and i think that anyone who recognizes what parity means and you have travel, i have expedia on tonight, is that europe is just the -- the dollar's just way too strong and carl, if the dollar gets weak, that's a very good call versus foreigners. i know we're worried about the fed, but before we panic about the fed like mr. ludnik would have in the previous segment, they may be winning. i mean, tomorrow, cpi, they may be winning why do we presume that it has to go up, up, and up, carl? when it's entirely possible that the only thing really left is wage and food. i have costco on tomorrow. they are one of the biggest, biggest companies when it comes to food. what if food goes down what if the wages stall, meaning, we don't get any more increases? then i think we put in the bottom on a lot of stocks. too bullish? carl, i don't think so >> that's what's going to be a

fascinating print tomorrow, jim. i know morgan stanley is looking for a month on month decline same with b of a year on year, msc, 7.9 >> was up 1.3, and we forget how dramatic some of those cpi numbers were >> but we started to see signs of that prior to powell's jackson hole speech, where there had been a hope there would be a backing off, and there wasn't, jim. he's your man. he continues to -- >> he is my man. he remains my main >> he's your man and then there are those who are worried. did you read the story about liquidity in the treasury market and perhaps concerns there of course, as well, given the balance sheet is being depleted? i don't know there's always things to worry about, jim not a concern for you? >> well, look, i don't like the way the two-year and three-year are tr trading either they're the greatest bargains in the world at 3.5 or they are just so wrong and we're

going to 4.5 i'm not buying the 4.5 theory, and i'll tell you why. if he does 0.75 and says, we're going to wait, what are we going to wait for if you're trying to buy a stock? maybe the midterm elections? so, i'm not a believer that we have not seen the lows i do think certain groups, as i mentioned, semiconductors, down 40% for the year, they may have to test the bottom but carl, where are all the negatives? i mean, where are all the corporate negatives? the lead story in the "journal" today is, we're worried about earnings maybe the journalists are worried about earnings what's the point of all the negative articles when we had that rally last week maybe things are a little better than we thought. what is the point of being negative after a gigantic slide? you get negative before the slide. not after. >> yep so, you agree, i mean, the jpm desk today, a calming market, signs of momentum, is it a green

light to get long or do you need to wait for some of these cpi retail sales this week >> i'm actually going to go with that view. i think that if cpi is tame, then we'll actually start worrying about the next number but there is not a single commodity, not a single one, that isn't substantially off its high i think we're going to begin to see the idea that there are layoff bu layoffs but they're not where we thought. they're going to be in techland. those layoffs count. whoever said the layoffs that matter is ford how about layoffs among the venture capitalists who have not been able to bring a single company public in ages where does it say that engineer layoffs, computer science layoffs, stanford, where's it say they don't matter? i wouldn't seen that article >> no. but it's happening but i don't quite understand why that's not a negative for the economy. >> well, we don't care

we need the fed to be able to say, hey, listen, we are peak wage they already said the peak commodity. >> we know they want to -- >> it's not like -- >> no, we know they want to provide some -- i'm sorry. it's always a little more difficult when we're far away. but you know, we know they want to, obviously, increase participation rate, as you pointed out many times, take the pressure off wages you think they're going to be successful in doing that >> not only do i think they're going to be successful, but i think we're one quarter away from major industries having to do some layoffs. obviously, housing but the ones i'm keen on are out here i mean, how many people will the amazons, the googles, the semiconductor companies, how many people are they gaining to lay off? and those layoffs count toward jobless and if jobless goes up to h4, i think you get one more

rate hike after this >> i think it's the san francisco fed that they actually -- it's brookings, i think, that said fed would need to push unemployment above 4.1 to get back to target. we'll talk we'll have plenty of time to discuss it >> one thing i want to tell you, it's darkest before the dawn. >> thanks for that, jim. >> deep. >> that is -- i got to think about that one >> well, it's always -- david, it's always hard you came up with that truism right? it's always difficult. >> oh, i have had -- as i like to say, i have a keen sense for the obvious, and i show it every day. >> and i miss and love you guys. >> we need you back, jim we're so delighted to have you, even at a distance today we'll get to some of the betting names as the nfl kicks off, nice job to the eagles. we'll talk with jim about that we got the rails, bristol-myers, disney, bitcoin, roblox, all

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white house reportedly planning to broaden the curbs on u.s. shipments of semiconductors used for a.i. and chip-making tools as well. sources tell reuters the commerce department intends to publish these new regulations based on restrictions communicated in letters earlier this year to three companies, kla, lamb, and applied materials. jim, it is a point of note this morning, it sort of fits into our broter discussion about ukraine. how can we lean in on china to

assure, i guess, in some ways, they're not going to come to putin's rescue you know, xi and putin are going to meet this week. >> this is a rather remarkable development to ramp things up. when you look at the intellectual property of a semiconductor, really, uniquely belongs to just a handful of companies, but they can't be executed without lam research, without applied materials, without kla. we shut down a long time ago, asmlf, which is based in the netherlands, and that really hurt the chinese these are wheelhouse these are right in the sweet spot of how to stop china. i wonder how this -- what is the way to be able to advance yourself, shy of -- i hate to say it -- but going after taiwan because you can't really make modern semiconductors that are ahead of the united states without these companies and then you can't use the a.i. of nvidia david, this is a shot across -- this isn't a shot across the bow. this is saying, we're going to

set you back big because we don't like the way you've been acting >> i mean, it also is a reflection of the deepening chasm between our two countries, right? china and the u.s. going completely separate ways we are re -- you know, bringing manufacturing back here. we've talked a great deal about ohio we saw pat gelsinger there late last week from the groundbreaking it's going to be a while, though, until we are -- we are fully functional in terms of actually not relying, even on taiwan that's years away. >> right >> whereas at the same time, to your point, you question whether the chinese are going to be able to have anything in terms of advanced chips given the lack of resources that will be available to them from the global markets. >> carl, the question is, are we at an axis of evil moment? i mean, obviously, we think russia is an enemy of our country. we're regarding china as an enemy of our country

russia may be losing war against ukraine. there could be a pocket of russian soldiers, you can imagine what that would lack like this is a reagan moment. i don't know whether the president's going to embrace it, but if there really is an axis of evil, well, we're certainly putting it together. >> i think you could argue that, you know, reports that russia's getting some ammo from the north koreans, obviously, do the iranians come in and assist but it's a pretty weak axis. most would argue the lesson of the invasion has been the unanimity of the global community to rally around ukraine and not russia >> you are so right. if you want to look at what this moment really is, and this is a fossil fuel moment, and i know that the greens don't want to hear this, but our exports have been huge. natural gas and gasoline to europe that has allowed europe to be

able to make it so that maybe this long winter that was thought to be playing for putin, may not go his way putin totally overplays his hand putin is now left with the idea that a dictator who fails is a dictator who doesn't live. if we ratchet it up, and gave the ukrainians even more arms, then i think you would have this moment that is pro-europe, pro-u.s., but mainly u.s. in ascendance because we happen to be the most domestic positive resource country in the world. >> right and of course, we haven't even talked about an interesting story in the "journal" today, manufacturing capacity in europe for example, aluminum makers and what may be a significant downsizing of their business as a result of the inability to get energy anywhere near the levels they need it to be, what they pay for it, to make a profit i mean, those are key questions. as are, jim, what happens to putin if he loses? you just raised the idea of what might happen to him. but what does he do?

>> dictators -- well, we know that mao died in his bed and stalin died in his bed but we know they were never defeated. when you're defeated, it tends not to go well if you're a dictator >> we'll see we'll be looking for answers, potentially, in the coming months and years still to come this morning, cross-country edition of cramer's mad dash. we'll count down to the opening bell as we have positive momentum continuing into a new week ♪ ♪

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>> announcer: "the opening bell" is brought to you by nuveen, a leader in income alternatives and responsible investing. all right, time now for a cross country mad dash to get to the opening bell carl mentioned, of course, bristol-myers at the toll top there of the big movers. very glad you're going to do it. as the company gets an fda approval for a highly-anticipated next generation oral psoriasis therapy. >> this is big for two reasons one is that bristol-myers has been primarily known for its cancer franchise i was concerned that it's not been able to grow, because revelment is not growing but this is a major new leg for bristol. plaque psoriasis, this is a much larger market than people

realize, and psoriasis is something that's painful but also if it works for this, it could work for many other things so it is a big deal. should the stock be up five? i think the drug stocks are the right place to be. up five seems to be a little extreme. but when you consider that bristol really was kind of stuck in a world of, let's just say, a battle with merck over anti-cancer, this is a really nice diversification >> wasn't bristol up on something else recently as well, jim? or am i misremembering >> well, dr. qafar has done a couple things. it's been beating merck most recently on a few things, david, and he's a -- someone who has bided his time, but you know what merck -- ketruda has not trumped, and bristol is still very cheap and the doctor is to

be saluted >> as you say, when we are talking about psoriasis, i'm seeing here, atlantic equities, peak sales estimate, as much as $4 billion from what had been -- from $3 billion. so, this is a large potential -- >> oh, yeah. >> -- drug for the company >> yeah, it -- >> especially given the clean label we're seeing from the fda. >> to many other illnesses that are connected to plaque psoriasis. having at one point had the challenge of this, i can tell you that the drugs that are currently being used are second rate, i think. and this could be first rate i, therefore, would jump immediately to the first in class. >> meanwhile, jim, we mentioned your birds over the weekend. and we do have penn nat and draft kings up today on some of the, not just volume of anticipated betting but also

some of the parlay-busting upsets and you can look up and down the game schedule yesterday, and there were a few of them. >> yes i mean, these trades, very specifically on approvals, but at the same time, anything that gives you volatility plays into their hands. i don't want to get too excited about them until they're getting their costs down for acquisition. it's just too much money to be able to open accounts. one of the things that i have seen with these gambling things, we didn't talk about disney. i mean, is bob talking about being a competitor to draft kings, fan duel, or is he going to have an advertising model you know they spend a fortune on fantasy, but they don't even have fantasy -- what's known as dfs programming that would be right against their schefter-led fantasy. so i don't know. i think it's time for disney to figure out whether they want to be advertising or they want to be fee-based, and i think if they're fee-based, stock goes up

big. >> more on that after the bell, jim. we can discuss it a bit more, given those comments to your point, we're not particularly telling in terms of what the actual strategy going to be called >> disney up a percent before the bell it's going to have at least a couple points to the dow let's get the opening bell on the cnbc realtime exchange and the big board, permian resources celebrating the merger of colgate and centennial we'll talk to the co-ceos in a few moments. nordic commercial property company, david, jim sort of set up disney in the wake of the d-23 conference. we did get some new previews of avatar ii and "black panther" 2 and then of course ancillary headlines about lobe, about hulu, disney plus, and so forth. >> and again, to jim's point, not that much from mr. chapek in terms of exactly what a new strategy may be for espn, but

certainly pushing back against this idea that the asset would be better off no longer a part of the disney family now, that was something that was introduced as well by the way, i mean, it's not like it's a thought that hasn't occurred to people inside disney for years, and to any number of bankers, but it was also part of that lobe letter from a few weeks ago that we brought you. and we've kind of had doubts about it even then, and initially it didn't seem to be part of the way disney is thinking about espn right now, jim, which is much more a part, first of all, of an important bundle, disney plus, espn+, and hulu not to mention the prospects that you alluded to of what you can do in the new world of gaming and betting in terms of incorporating espn so, you know, chapek sort of just simply saying, did a number of print interviews, you know, we have a plan, restoring espn

to its growth trajectory when the rest of the world knows what our plan is,our plans are, the will be as confident about that proposition as we are. those were his quotes, i think, to the ft. >> all right, well, okay, so, he wasn't that specific now, i think there are a couple of things. theme parks are where they have to double down but david, i come back and say, when someone -- when a ceo says there were multiple buyers if they wanted to sell espn, even just a month ago, i would have said, who's a buyer? who's a buyer? >> well, you know, i think you could imagine private equity certainly having some interest in it. you know, you would, but it -- the idea of spinning espn is still a very significant cash flow producing asset that can support a lot of debt. obviously, it's not growing. it's shrinking but you might imagine that there might be some interest from

private equity or linking it with other assets. but not clear to me exactly where. you've got the cost of programming only going up in terms of what they're paying for sports rights. certainly we talk about the nfl but even the nba and other sports leagues and so, it is -- it's a difficult place where they find themselves, jim. i don't know if there were other potential buyers that would be more strategic, particularly, you'd have to get an awfully large price, particularly with the idea if you were to spin it, as it would be a possibility, you'd want to put a lot of debt on it. it has been around for a long time, the potential spin personal loans, 20% of this thing. they have certain rights there as well. but it's going to stay a part of the company, and i guess there's a plan you know what? i'm going to have an opportunity to do, ask mr. chapek about that because i am going to have an opportunity to sit down with him at the communicopia conference later in the week where he will

be my best we're looking forward to that. >> ask him about hulu, david that was kind of odd, wasn't it? >> i will ask him about hulu and espn i will ask him about disney +. we're going to have a long-ranging sitdown interview >> don't forget to ask about the theme park in new mexico don't forget 300,000 acres that i have proposed >> if it's the last thing you do, jim, you're going to cut the ribbon on the opening of that new mexico theme park. >> because i was in italy, i didn't put the shovel to ohio. >> that's where i'm going, right? that's the first question, jim don't you worry. >> well, don't worry, because i know the answer. >> well, you know, eiger spoke at code last week, pretty interesting comments he did get a bit into the metaverse, said it was interesting but early. today, jim, cowen, while we think it's an enormously important technology, we also think realization of the

metaverse could be at least ten years away they initiate roblox underperform 31 target >> ten years if that's the case, then mark zuckerberg is going to be in sunrise senior living when this takes off. ic metai think metaverse is goit be integrated. by the way, i think meta is going to start charging for whatsapp but there are companies that want to be in the metaverse, kind of as a mall. when -- i do believe that when chapek talks about the metaverse, what they're uniquely talking about is the idea of being able to isolate players in football that you may be betting on, one of the 55 million people who plays fantasy football otherwise, i think we got to drop the name, metaverse it's too funny maybe we call it money-verse >> okay. i'm still trying to imagine zuckerberg in sunrise senior

living he's going to go through there with this karate stuff, right? just cleaning the place out. kicking everybody's butt >> well, then -- that's one of the -- well, you know, look, if it's not going to start making money in ten years, i mean, we're talking about a 30-year time frame, and in 30 years, maybe he's working on something about longevity, probably. maybe he's got a longevity gig going. >> i'm sure he does. they all do. and probably also going to mars. maybe he'll get a spot on elon musk's rocket, you know, cultivating the next -- >> speaking of mars, did you notice i'm in the space need needle that's where i am. that's why it's dark >> you're in it? >> yeah, i am it the needle starbucks, costco. you know, today, amazon web services i don't know if you know those guys, part of amazon and then expedia, which can help you book a trip to mars.

probably far away. >> in a largely positive take but the nasdaq up over 0.5%. did want to mention twitter is down 1%. elon musk's lawyers, they don't stop you got to give them that. they just keep coming. october 17th is when we're going to trial in delaware that is not likely to change at this point but they did come with the latest of what has been, you know, a series of termination letters, essentially this one was dated, what, the 9th of september saying, hey, you know, you entered into a -- a severance agreement with the whistle-blower, zatko, without gi giving musk notice and seeking his consent which he asserts is an incurable violation of the merger agreement of course, we have a response as well from twitter, which says, yeah, we don't agree with you.

you know, i don't know, jim. i mean, we saw this figure into a small deal earlier this year where brava got a price cut but it didn't go to trial, where they sort of alleged something somewhat similar there's what twitter's lawyers say. as was the case with each of your purported terminations, the musk parties termination is invalid. musk parties and other parties continue to knowingly, willfully and materially breach the agreement. twitter was up substantially last week in part because the trial was not pushed back, and while the judge did amend his counterclaim, she did not really allow for significantly more depositions or time to prepare for trial, based on the whistle-blower's claims, jim >> well, to me, david, this is not going musk's way and i think that one of the things that musk has never really faced is a recalcitrant leader of any sort of

regulation, and he can't thumb his nose at a chancellor he's not able to make fun of the chancellor it must just chafe him that he can't call the chancellor stupid or i diot or a mount bank or a fraud because she isn't. she's real smart and i think she's going to try to force these two to do a deal or just say, pay up, musk. you're like everybody else you come to my court, pay up we're in delaware. i don't think he knows delaware. i think he thinks he's -- that's like the rest of the states, david. >> well, we've discussed this any number of times. it will be fascinating getting close to a month out from the trial, carl and it will be a five-day trial, obviously, the decision will not be immediate but we will see whether she, in fact, does order specific performance. obviously, still a very large spread to the 54-20, and as jim mentions, but you know, this latest back and forth would indicate otherwise you know, there is always the possibility of the two parties reach some sort of a settlement,

so to speak. my read right now on the twitter board is, they're not interested >> yeah. >> that always can change. >> yeah. great call >> yeah. october 17th is rolling around fast jim, we ran a couple chyrons this morning about bitcoin highest since august 19th. actually, friday was a top five day for bitcoin in the last 12 months, and then, of course, you got microstrategy issuing half a billion in new shares to buy even more. your thoughts on where crypto is >> well, i think that they're -- you know, sam bankman-fried is trying to play the role of jpmorgan, the original j.p. morgan he managed to stem the decline rather amazing, coin base going up and big holders are being bailed out i still think that bitcoin is part of a speculation, carl, that the fed doesn't want.

i think that he -- that when you think about what should go down, what the fed wants to go down, i think it's speculative assets wherever they are. and you're looking at the most speculative asset there is >> we also want to get to the rails, jim i know david mentioned it earlier. the possibility of a strike by the end of the week, and because of that, we do face the prospect of some of the major lines starting to reduce their levels in advance of that starting today, actually although, there's been some defense on the street of some of the canadian lines i know you've been talking about this for months. >> yeah. look, i thought that bank of meas america's call about upgrading union pacific, perhaps the most stressed when it comes to labor, was pretty gutsy i don't think you do that unless you feel that you have a strong sense that things are going to work out here in the end when you look, by the way, at wage inflation, look no further than the rails i mean, again, i'm trying to think constantly about what

powell may be thinking the rails, even though there are not as many employees as there used to be, in order to get knows employees back after covid, they're paying much more and it comes back to the same thing we keep hearing about, that there's a big reduction in the workforce because of covid, that we don't talk enough about, and i do think that, yeah, i think that he's right. costs will rise. and the fed can you not want that either. the fed wants to see costs fall, and that has not happened yet for anything but the royal commodities so it's not reassuring >> it's pretty remarkable. two-year break evens, jim, are closing in on target i mean, they're basically 2-3. >> well, i don't know. look, i've been buying two-year and three-year paper because that's one of the assets i'm allowed to buy david, i find two and three-year paper, when you're my age, and you can't really do much until a few years from now, that's a perfect piece of paper for me. those are great.

because you can't touch them anyway and we're not losing think about it, david. >> not losing. >> three-year. think about it 20-year paper for you. 30-year paper for you. >> is that something you might be interested in >> is that how long i got still? >> the zuckerberg 50-year buy. how about a zuckerberg 50-year bond >> he'll really be in sunrise senior on mars, of course he'll be there maybe he'll even, who knows, go further. his rocket ship's going to be even better. carl >> yeah, yacht culture and pretty soon it will be rocket culture, right quick reminder here, you can get in on the cnbc investing club with jim, sign up and find out more, cnbc.com we like to provide a qr code for you as well. before we go to break, we're in the fed speak blackout window. with that, all yields are down across the board

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s&p just a stone's throw here from 4,100, and the dow is up almost 200. busy week. we mentioned the macro that's headed our way, cpi retail sales, empire, philly, michigan, but congress is also back to work we're watching ukraine, and as we said, busy month for conferences, s.a.l.t. new york, goldman-sachs communicopia we're back in a moment business. unlock new insights and efficiency, with leading ultra-capacity 5g coverage. t-mobile for business has 5g that's ready right now.

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all it was about a $7 billion merger of equals that took place recently we're joined with permian ceo james hickey the stock now trades under the ticker pr. nice to have you here. i brought the first question, let either one of you decide given you're co-ceos you are talking about planned activity levels, therefore, targeting crude oil production growth of about 10% in the fourth quarter of 2023 over the fourth quarter of this year.

and the possibility of generating as much as 1.1 to $1.3 billion free cash flow. give me a sense of why you're confident in that 10% growth number and the free cash flow numbers you put out there. >> i'll take that one. so, currently, permian resources is in the 6 or 7 rigs we need to exe execute. both businesses were growing pre-merger we feel confident in our assets in the delaware basin, and we have some of the best assets in that basin this is continuing to execute on what both companies did pre-merger with the new team we're confident with the new team together will be better than either one was before the deal. >> speaking of team, and i know jim will have a lot of questions for you, how are you apportioning the co-ceo roles? to be frank, sometimes those don't work so well i'm curious as to the conversations you've had and where you see each of your responsibilities being to allow you to actually work well together. >> yeah. will and i have been co-ceos for

the past seven years it's worked well for us. it's natural will has a technical background. he spent most of his career prior to starting colgate at pioneer natural resources. he receives engineering, production, operation, geology i have a transactional background, m&a, legal, ground it works really well i think that's a great part of our success story. >> jim >> james, it sounds like, you're right from the beginning, adopting a pioneer-like method of payout. you are determined to give the shareholders cash flow can you speak to that? in the old days, of course, it was drill, drill, drill. niece days you seem to be favor a position, you have 10% growth, which allows you to return an amazing amount of money. any thoughts at these prices what sort of yield you might have >> yeah, we're in the position we can grow and return meaningful capital to shareholders i would say returning capital is in our dna we founded the predecessor to

permian resources with maximizing investor return through distribution we're really excited i don't know exactly today, i think you're probably looking at 14% or 15% all in return of capital yield with a dividend yield approaching 2.5% like you said, jim, it's really competitive. it's up there with a lot of the big boys in e&p. >> will, you should know my trust is overweighted with oil we absolutely love that return at the same time we feel the market has not been very kind to the group. reuters reported december of 2021 that colgate sponsors were exploring an ipo better way to be able to come public than an ipo >> yeah, i would say this transaction was way better i think the assets the centennial transaction, the people that brought, this really builds a bigger, better company than we ever could have done on our own. >> well, if that's the case, is the idea to, let's say, put

continuous areas together and, therefore, take advantage of the idea that, as we've seen time and again, say, with pioneer, that if you can just take the same number of rigs, move them over, the expense structure is really terrific? >> yeah, definitely. i'll take that one as you look at this merger, we're cutting a lot of costs out of the business. really from operational synergies. both businesses were very, very good at what they were doing pre-merger we've been really surprised as we kind of laid best practices next to each other there's a lot of extra fat we can cut, and we can adopt the best things centennial did, the best things colgate did to set up permian resources for success. >> and on the -- >> let me follow up. it does feel like -- i was afraid you paid too much for it. clearly not. the market is saying right now that we're thrilled with the combination. and i think, once again, it's because, and you just mentioned, makes me feel like people can get great yield right here from the patch.

how many years do you think you can sustain something like that? pioneer is saying -- mr. sheffield is saying many, many years before they have to worry about cash flow declining, as long as oil stays above, say, 75, 80 >> yeah, i think we can sustain this production level for decades. we have one of the highest quality assets in the entire permian basin. like will said, is the best basin, we think, in north america. you know, i think, yeah, at 75 or $80 we can sustain this indefinitely >> indefinitely. i mean, now, of course, the demand overall over time for what you're producing may decline given the proliferation of electric vehicles >> yeah. and i was using the $75 to $80 i think we feel good about the demand side, too we're in a period where we're seeing the results of years of, you know, underinvestment in the space. it doesn't look like that's changing any time soon. >> so, despite what may be lower demand over a longer period of time, you feel like you're well

positioned to go out, let's say, the next ten years >> yeah. just being in the lowest break-even basin in the u.s., gives us confidence we'll be one of the last ones standing. >> guys, appreciate you stopping by congrats on the deal thank you. >> thank you, all. jim, you have a busy night tonight. what's on "mad". >> i'll tell you, we have amazon web services amazon web services, very sustainable company within amazon, but also of course one of the great drivers of the earnings and then expedia are people traveling again how are they doing it? is this the way they're doing it i'm also watch, by the way, my apple watch and apple devices because we have a change in ios. once again, next week, we've got a huge, huge 14 launch apple is doing quite well today in the market because of that. >> jim, when are we going to get you back home? >> i don't know. i'm going to fly wednesday night.

try to catch an hour or two of sleep. and then be ready. i have to wear the same suit who knows. >> typical cramer week we'll see you back here and look forward to "mad money," 6:00 p.m. eastern time. s&p, 149.09. all sectors green. don't go anywhere.

welcome to another hour of "squawk on the street. here at post 9 of the new york stock exchange morgan brennan is off. first peek above 4100 and setting up expectations for a busy week. a bunch of industry conferences as maybe some earnings pre-announcements we often get along with them. >> we are 30 minutes into the trading session. let's give you three movers we're keeping an eye on. twitter, those shares had a big week up, but down ahead of tomorrow, what's going to be that whistle-blower who will be

on the hill, probably facing a lot of senators and the like who are not particularly happy with twitter overall. maybe friendly questioning you have shareholder vote. you have another termination notice sent by musk's legal team to twitter they're dismissing it again. october 17th is when the trial starts. let's move on to chip names. amd and some of the others amongst the biggest laggards on the nasdaq not that much, but this underreports the biden administration could curb shipments to china of chip-making equipment quiment. disney had a packed d23 expo they said, you know what, dan lobe, you may think spinning espn might be worth doing but we see a real growth opportunity here we'll have a chance to get into that in more detail with bob

chapek, company ceo, later in the week. let's begin with santoli and get thoughts on the open euro this morning, risk sentiment? >> yeah. continuing from last week, all these rallies start in a very oversold spot with people seemingly underinvested and looking for the downside that happened again. i would look for it as a reinforcement of the idea we're in this trading range. market for the last four months, 3900 on the s&p up to 4300 has been the rule. we spent very little time under 3800 this year like ten days, even though we bottomed at 3600 to me the low end and the high end of those ranges coincide with, does a soft landing seem remote or does something like a soft landing seem more possible? dollar peak, that suggests the market is thinking that the fed's destination in terms of rates and when it's going to get there are in sight, even if they're not known for sure we'll see if that gets tested with the cpi number tomorrow the dollar coming off again today does kind of reinforce

that idea. i think the final piece of it is, how much earnings erosion in terms of the forecast is priced in with a 15% decline from the peak in the s&p and how much is yet to come? i think that's what we're still waiting to really ascertain. >> it's a great point. did the bulls, you think, they look good defending 3890 >> yeah, 3900. i mean, there's a lot to -- i i think to speak for the effort off the low. again, it's a similar to what happened in the mid-june low where you basically had wild numbers coming off it, very positive credit has been pretty well contained, so it's more or less confirming what's going on again, it's sort of like, tell me what happens at the high end of this range to know if there's anything more to it. but we have burnt up a lot of that real negative sentiment and positioning and probably still more left for fuel. >> for more, our next guest says investors he has spoken with are tactically long. joining us on set, founder and

ceo, adam parker, is with us great to see you. >> great to see you. >> tell us what you see in the short term. >> i thought mike set up the issues really well in what i'm talking to investors about everyone knows earnings are too high i think positioning is such that people think it could higher in the short term but it's a game of chicken people know what's coming is still going to be a generally hawkish fed. that probably isn't great for the price to earnings ratio people pay for earnings. the question is, as earnings come down, we think they're going lower. do people get bearish at the bottom yes. we'll see through october earnings season, conferences this season, there are data points coming for people get a feel for how much they're going to come down. >> have you been impressed it hasn't really hit yet? >> two things there. look, we all know what fed fund futures started going up last year but they didn't act until march. the idea we saw q2 earnings, and

the full impact of the lift-off in march was in the numbers is kind of silly. it's probably lagged by somewhere between one and four quarters i think you'll start seeing the slowdown in the earnings estimate one chart we made that really, i can't stop thinking about, public companies that do consumer, basically 20, 30-year revenue growth currently 12 months between 12% and 30%. obviously we pull forward some revenue from '23 and '24 into the last year. the question will be, how much does that come down this is i think there's a narrative now consumers hold the bouquet, to mike's point, maybe a higher probability of a soft landing. that fuels a positive narrative. the numbers are going to come lower for the consumer we know that the question is how much of that is in the price. i don't think it is. so, we're playing chicken. long-term rally but we know we're going to get something bad later in the yaoer. >> so you don't think it's in the price. >> i really don't in terms of the medium term outlook. how can businesses that grow 6

to 8 for 20 to 30 years grow 20 to 30 sustainably? they can't they slow down in pricing power, the economy slows, et cetera you know, wages probably don't inflate at the same rate they were certainly they won't in wall street when we get to bonuses in january of next year i think you'll see a slowdown in the consumer from q4 this year through q1, 2 next year. >> i do wonder about where the pain is going to be applied and where you're going to see more residuals. consumer cyclical stuff, housing, those stocks have definitely worn the risk at this point. industrials holding up okay. you still don't have the mega monster cap top five names where it's just trimming of earnings estimates, which is a huge chunk of the index profits. >> you make a good point, right, which is nominal versus real gdp. none of us in our lifetime have seen 8% nominal gdp, 9% cpi.

eight minus nine is minus one. we've seen 2% nomal, 3%. i think the unit sales have been pretty good. the bigger companies can protect their margins better than the smaller ones mike's point is spot on. small cap companies have seen meaningful revisions, the big once haven't i think at some point the big ones run out of ability to protect their margins. you mentioned some of those trends i agree with that. i think that's coming over the next six, nine months. it's not apocalyptic view. >> what does that mean in terms it of you want to be long or what you don't want to own in this period? >> i really like health care we did some work that shows it's never been one of the top two performing sectors in an upcycle in the last 30 years when i look and compare portfolio strategy, health care services to consumer services, i believe their numbers are more achievable i think people will need it. it's gdp plus. they have pricing power.

i like that. if i compare pharma to staples staples are very expensive should have input cost problems, currency problems, probably slow as the consumer goes down to private label and other stuff, and i can buy pharma at the same dividend yield the worst case scenario is you're long something and it trades at a higher multiple. >> mastercard with their spending pulse looking at holiday, they're looking for 71 in nominal terms are households or delinquencies -- >> it's probably six, nine months early 90-day credit card delinquencies are -- every time i watch a sporting event, there's a buy now, pay later on the mound or end zone we know what happens after that, six, nine months later, they don't pay later. we've seen that every time. >> ai is going to fix it ai is going to fix the whole

thing. >> i don't think so. there's a lack >> can semis be viewed at idiosyncratic here there's all this policy stuff and then indigestion in the cycle or something there >> we have a quantitative metric call company specific risk it's how much of macro explains returns and what's left over we call company specific. of the 24 industries in the market, semis is the most macro. actually strictly speaking macro variables explain the returns more than anything else. you have news today, maybe it's bad for nvidia, maybe it's bad for the equipment. what did you say, equipment equipment? >> it's a subsector. >> i can only derek only i can say that nobody else is allowed to say equipment equipment. >> i like it i think when you look out medium to long term, those businesses have tremendous pricing power. the world can't function without them they grow above gdp. you're in a weird pocket where it's bad for china consumption but probably good in the medium to long term. >> that was good

>> have a good day >> adam parker. as we go to break, take a look at the road map for the rest of the hour chip names under some pressure as the white house looks to widen some of the curves on the industry plus, you think new york private schools are hard to get into, try florida. we'll speak with the head of the benjamin school, a top school in palm beach, about a growing wait list and backlog. twitter shareholders get set to vote on a musk merger and say whistle-blower heads to the hill

the reportedly planning to curb shipments on semiconductors used for ai and chip-making tools. our kayla has the latest. >> the commerce department has limited export of certain chips to china and, by extension, russia, that could be used militarily and now could expand those curbs to include technology seen as more broadly sensitive and strategic, according to multiple sources. though the commerce department declined to comment. commerce is just one of several agencies currently reviewing limits on business with china. the white house and the national security council are studying new outbound investments review that would be a reverse cfius process. the administration is also weighing a new investigation under section 301, all while

modifications of dpising tariffs are still under consideration. there have been two key challenges in rolling out these multiple pieces of the strategy. one, building consensus among principals, which has been hard to come by this year, and, number two, not escalating tensions with beijing with a bilateral meeting on the table in the coming months while still be willing hard on china here at home china is on the mind of voters particularly in the midwest and ohio with a critical senate race there. that's why some officials see a possible announcement in october ahead of the midterms but no implementation for some time and as we've seen, guys, it's a review that goes on for many months, by many agencies and the final policy that gets implemented could look quite different. >> kayla, you mentioned that the existing tariffs on china and a bunch of categories still on the table. to what degree are they really on the table in terms of what

the burden of proof is to have them lifted at this point? is the default assumption just that they remain in place? >> yes and the u.s. trade representative has said that they will remain in place, although the president could make a decision on those tariffs that would supercede what the ustr has already done. there are three specific things on the table one is relaunching an exclusion process so that companies can say, hey, these are a detrimental to my business i think we need to be excluded another is a modification process where you would essentially hone in some of these tariffs on more strategic sectors while relieving them on consumers. the question so far has been, what does the u.s. get from china in return? why unilaterally roll back those tariffs if it's problematic politically here and beijing doesn't make any concessions of its own? that's been really the rub for the white house and for these principals so far. and then, of course, there is that potential bilateral meeting in mid-november. >> finally, kayla, the idea that

xi and putin meet in kazakhstan later in the week. are there worries the two of them together create some parallel, vis-a-vis ukraine? >> there has been this nacent alliance for the past decade and they have come closer in recent months as the west aligns themselves with ukraine. does president xi try to strike a side deal with president putin on long-term purchases of oil or refined products at a certain price? what does that mean for negotiations for the price cap on russian oil going forward and what -- how does that frame the conversations at the g20 in the coming months? there could be some announcements there. they're looking for any contours of that discussion if not any specific details about possible participation and cooperation between those two superpowers going forward.

>> that's going to be key thing to watch this week, too. kayla, thanks. that's a lot in there. bitcoin back above 22k what that means for names keli microstrategy and coin base when we come back in a moment if you have this... and you get this... you could end up with this... unexpected out-of-pocket costs. so if you're on medicare, or soon to be, consider this. an aarp medicare supplement insurance plan from unitedhealthcare.

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bitcoin prices crossed 22k this morning, up 10% in the last week and hitting its highest levels in nearly a month as a result, we are seeing crypto-linked equities watch ark innovation akk, coming off the best week since early august, snapping a three-week loss there a top holding coinbase down 70 for the year but up 50 in the last two months and more than 3% today after gaining 23% just last week. we'll talk about defending some levels in crypto as well. >> yeah, a lot of that in a lot of these charts. getting into energy and the oil outlook, oil prices rising today as tight supply struggles to meet robust demand. joining us john kilduf

we see news about russia advancing and on the other hand, dollar coming off pretty sharply. what does it tell you about the swing factor driving the day-to-day for crude >> yeah. good to see you, mike. we've definitely been caught up in the macro influences of the overall market here. certainly the march of the fed and the other central banks put down pressure on crude oil over the past couple of weeks and bottomed out last week you were talking about the various asset classes finding some bottoms looks like crude found a bottom last week, 82, 83 area and coming back now. i think part of the issue is the dollar coming off. that's because the dollar has sort of, you know, i think consumed all of its first mover advantage, if you will, in items of the fed being way out front of all the other central banks in terms of tightening which put a shine on the dollar and the inverse relationship exists with

dollar dominated commodities like crude oil dollar goes up pressure, not 100%, far from it. the move was big enough in the currency, then it happens. it's a very clouded picture overall for oil because, you know, the biggest demand center, china, continues to have struggles on a couple of fronts. its economy, for starters, and now these continued and expanding covid lockdowns, which seem to come apace, holding back their demand demand last month, according to trade data, down over 1 million barrels on the day year-on-year for the month. that's a big headwind. things aren't going well, as we can see over the weekend for russia, thankfully and to the extent this war has an end potentially, one that doesn't include a future for vladimir putin, the supplies from russia all of a sudden are looking a lot more secure potentially. >> yeah, that's an interesting piece of it because there has

been a sense out there that, you know, russian oil's been finding its way onto the world market. it's not as if it's been completely closed off. therefore, seemingly shifted to more of the demand drivers such as china, as you say is that not the case >> that's very much the case look, you know, the biggest fear in the market back in march when this war was initiated by russia was significant loss of russian barrels. that just hasn't happened. there's been a reordering of the supply chain, india stepped up in a big way, as did china, of course, for huge discounts now, of course, though, the big worry in the market is two things going for it. from a consumer's perspective. this upcoming winter, obviously, we have very tight diesel fuel and winter heating fuel stocks going into the winter and this december 5th sort of cliff in terms of the eu potentially finally foregoing all russian crude oil. but this price cap idea is starting to get some currency

because it may be more workable than at least i thought initially. still got to figure out if putin goes for it or not that's my big issue with it. beyond that, when wants the petro dollars, if we maintain the russian flows of oil, then the economic situation in places like china and some of the other factors, particularly the central banks engineering a soft landing, hopefully, come into play and keep a lid if not downward pressure on prices. >> that's interesting, john, especially since so much of the cap proposal had been viewed skeptically. is your evolution andyour thinking, is that driven by the details as they've come forward or a shift in putin's leverage >> it's kind of both the details, as they've emerged, make it a bit more paltable.

i'm not sure the price capital would be all that horrible for russia is it something putin can swallow? again, some of the pushback i had gotten from my own skepticism and really disbelief in the whole scheme is his desperation. apparently he can afford to lose the gas revenue, but the oil revenue is a different story the other issue for russia is they don't necessarily have storage capabilities and would be damage to the russian oil industry if a big part of their exports and supply chain was to be foreclosed. so, he may be stuck with it after all, and it could be something that's workable. again, that would help the supply situation bigley. >> it's highly unlikely, but you talk about what he can afford to lose it's not clear he can afford to lose the war and what that will mean for his status, of course, as the man -- the autocrat who runs russia. listen, it's very unlikely, but what if he were to lose power in

some fashion, what would that mean for global supplies and for russian oil? >> i mean, depending on what we get in his place, it would drive the whole situation. but if russia was to try to get a new leader that would, you know, re-enter the community of nations, obviously, they would be welcome back. and the oil supplies would be greatly appreciated. it would be pretty easy for russia to reinstate the innord stream 1 pipeline flows. i don't know how likely it is given how poorly -- how bad the news was for him over the weekend. i don't know how true the reports are about starting to see some pushback internally against him from various leaders within the kremlin so, he could be on the ropes more than we all realize. >> yeah. these things are hard to imagine until they actually happen i guess you're right >> for sure. >> yeah, that would be a

positive shock for a change. thanks for covering it all for us appreciate it. >> yes, thank you. good being with you all. we're just 24 hours away from a big day for twitter the whistle-blower there, peiter "mudge" zatko, he's going to head to the hill for the senate committee. we'll discuss that next when "squawk on the street" comes back ♪ ♪ wow, we're crunching tons of polygons here! what's going on? where's regina? hi, i'm ladonna. i invest in invesco qqq, a fund that gives me access to the nasdaq-100 innovations, like real time cgi. okay... yeah... oh. don't worry i got it! become an agent of innovation with invesco qqq

here's your cnbc news update at this hour ukraine's military continues to reclaim land from russian forces believed to total more than 1,000 square miles soldiers raised a ukrainian flag over a house in the formerly occupied kharkiv area.

a soldier washed his feet on a russian flag that had been taken down in minnesota, some 15,000 nurses are on strike they're seeking a 30% wage hike over the next three years as well as better working conditions some hospitals, though r offering a 10% wage increase. and queen elizabeth's coffin is now on public display for the first time it was moved from the royal residence in edinburgh to st. giles cathedral. the procession was watched by thousands. services under way for the queen at st. giles cathedral where queen elizabeth's coffin will remain for the next 24 hours david, back to you >> okay, thank you. well, twitter is rebuffing elon musk's third attempt to scrap his takeover deal saying payments to whistle-blower do not breach any obligations testimony from that former employee will take place on capitol hill tomorrow. he'll be before the senate

judiciary committee. joining us to discuss, elevation partners founder roger mcname anything going to come out of that hearing tomorrow? >> david, if we've learned anything over the last six years it's that the senate will put on a performance and go back to business as usual. i don't expect anything to come out of this, other than we'll point another day of attention at this issue. and, frankly, at the very serious security issues that peiter zatko has raised relative to twitter. >> you say this issue. explain what you mean when you're talking about it. obviously, you've joined us talking about a range of issues through the years that senators and congressmen have talked to various people at hearings about. >> so, zatko is a famous white knight hacker who was hired by twitter to be the head of security and he didn't last very long

in the end, he was fired but, according to materials that he's released to the s.e.c., twitter has violated its 2011 consent decree with the federal trade commission and committed a series of really serious security offenses. i mean, business practices that would be unacceptable anywhere, but particularly to a company that has the level of import that twitter has as twitter is the most important platform for politicians, for celebrities and for journalists. as a consequence, be one has a right to expect that they will take at least industry standard security precautions what zatko is pointing out is they may have had industry worst implementation of their security policies. >> we should point out the last audit by the ftc concluded in may after his departure, so it remains unclear exactly where things stand between that regulatory agency, roger, and

the company itself over some of these issues >> indeed. again, these things are done by consultants and the economics of those consulting relationships give rise to some questions about the validity >> yeah. you know, he's not going to be treated as a hostile witness, is he my guess is it will be fairly friendly territory or do you have a different view? >> you know, i have no idea, david. i think some people are going to want to make campaign ads and some people are just going to want to entertain their constituents we'll see what happens my expectation is there will be lots of fury but nothing from an investor point of view, nothing comes out of it. not that something shouldn't, but i just don't think congress is in the business of actually enforcing the law any longer when it comes to companies like twitter. >> when it comes to enforcing the law for twitter, it will be about chancellor mckor mick and that trial that begins october 17th we talked about it before. that's about enforcing a contract do you have any change based on

what you've heard from the whistle-blower in terms of twitter's ability to enforce that contract at $54.20? >> i do not see any change that said, you know, delaware is a very, very business-friendly state. and, obviously, elon musk is a very powerful businessman. so, i think at the moment, you know, my expectation is the contract law is very clear on this, but how it comes down, i think, is largely going to be a political matter we'll have to see. i do not know. i would say by all rights you should expect musk will be forced to follow through on the contract, but then again, when is any billionaire forced to follow the law in recent years it just is not the practice in the united states anymore. >> billionaire he's a -- i mean, he's beyond -- you know, 250 of those billions. >> well, that's my point >> yeah, he rarely seems to follow the rules, right. but the law is the law, roger. i mean, really you're quite

cynical. >> well, i feel it's appropriate. and i think it's appropriate because as an investor, the law really matters we depend on property law in order to be shareholders as a consequence, when people ignore contracts, when people ignore property law, that's a huge threat to investors you know, david, because i've been on this program talking about this before, that i'm really, really worried about all of the trends in the united states when it comes to enforcing property law and contract law because we have been giving a pass to super rich people whenever they violate some contract or some law. we defer to them as though they're royalty. and in my mind, that ultimately leads to a terrible place for investors. >> all the more reason why that trial is going to be very interesting. >> why all of us investors should be -- we should all be hoping that the contract is enforced because i think in the end as investors, we depend on

contract law this is going to be as high profile a case of contract law as we've seen in our lifetime. >> yep, agreed that's why i'm going to be in the front seat roger, thank you >> take care, david. >> sure thing. as we head to a quick break. don't want you to miss, we'll have an interview with disney ceo bob chapek as he lays out his plans for the company's future, including espn and a lot of other things. we're back in two.

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welcome back to "squawk on the street." mrashgts higher ahead of the big cpi numbers tomorrow and hawkish commentary from fed officials across the board here to talk about this is citi chief executive officer. darrell, let me start with you a lot of hand-wringing still about potential earnings revisions and even layoffs

on the other side, washington post has a piece crossing this morning citiing yumish saying consumers are starting to feel better in the face of eceding inflation and gas prices how are you feeling the dividing line on sentiment? >> i think sentiment is an important thing. it ticked higher on the back of gasoline prices and food prices coming down. what will be interesting is even though in tomorrow's headline number, it will come down from probably 8.5 to somewhere around 8% the core rate will still tick higher as rents tick higher. i'm not sure the consumer is feeling quite as much happiness as maybe what some of the university of michigan consumer sentiment would suggest at this point. >> david, i assume you agree, that it's certainly not going to be -- unlikely to be a number that -- even if it is good, unlikely to move the fed, at least this month >> that's right. i mean, we're expecting actually

inflation will be down 0.3 of 1% for this month, which is a negative rate of inflation and the 8% reflects the rolling 12 months consumers are feeling a little bit better, but i think what we're really concerned about now, looking ahead for the next six months, is the total impact on the consumer of having rates go up 75 basis points three times in a row and whatever else the fed does so, the total impact of that, i think, is still yet to be felt and i think the impact will be very significant right now with employment looking like it does and being positive and continuing to grow, things are okay. but i do think we're expecting potentially next year to see between 1 million and 2 million job losses if that actually turns out to be the case, that will be the turning point where the fed realizes, wait, we've had too much of an impact on the economy, and too much of an impact on the consumer so, i think there's a lot of news ahead to digest >> darrell, the way the market has acted, you know, in the last

week or so, and then a few times before, it's as if it's trying to bring forward that moment when it seems as if it's in gear with what the fed is going to do and probably doesn't have too much more tightening ahead of it it's been disappointing, the market has, but at some point it will probably be correct in saying the next three to five months we're probably going to get to peak short-term interest rates. would that in itself be a bullish thesis or do we need more than that >> yeah, i think if you can see that with clarity that far in advance, then i think that would be a bullish piece what's interesting, what many people don't realizes, if you go back to all of the fed meetings this year, so march, may, june, july, where we raised interest rates, every single one of those were interpreted by the market as being dovish. and every single time the market rallied off those meetings, only to end up being a bear market rallied that failed into resistance and ended up at a

lower point at some point in the future the reality is, if you take fed fund futures at 4%, which is where they are this morning, any rate hike cycle has always had the two-year above the fed fund future that means the two-year has to go from a 353 probably somewhere north of 4%, which i don't think is priced into the market today. and i think can be quite hard on equity prices from here as they have to adjust to that >> david, you know, you think back to prior cycles where the u.s. benefitted in some ways to what was happening overseas. in the early 2000s it was growth the in china and they were buying up a bunch of our bonds in 2010, the struggles of europe helped suppress interest rates everywhere it seemed almost as if a little offset to some of the imbalances in the u.s. and the u.s. seemed like the haven are we seeing anything like that right now? nobody wants to see a bad recession in europe or china stalocked down, but it seems as if it's kept things from

overheating, maybe given us some help on inflation. is that just too hopeful >> yeah, its too hopeful we've gotten the benefit you're talking about definitely from the higher dollar and the fact that the u.s. has been very, very aggressive in rate hikes and we just heard about that i think that, you know, there is no good news in china slowdown there's no good news in a european recession that we definitely are projecting for this coming year that doesn't help the u.s. because it doesn't help, you know, the u.s. industry there. i think we're benefiting from right now, cheaper imports, we'll benefit from lower energy prices that we're a major producer of energy, we'll benefit from the fact that we have higher inventories, retail inventories. all of that will drive down inflation in the u.s. well before we see inflation come down in europe that's all good for us but in general to have the global economy in a stall, to have china in lockdown with the real estate crisis, europe going

through an energy crisis and a war, and the u.s. facing what i consider to be excessive fed tightening, those are all headwinds. they'll clear up in 2023 but we'll be the beneficiary in one sense but we won't be unscathed as a result of all of those things happening at the same time >> finally, darrell, you know, we keep talking about the ramp up in qt this month. barron's over the weekend citing a former fed trader saying we're locked in a world where we'll always be in qe because the fed will have to ultimately, in his view, become buyers again. how much of a weighing dynamic is that, at least this month yeah, i mean, everybody knows qt is doubling. what most people don't know, mike, is that we really have not rolled off many securities off the balance sheet after three months worth of qt at a rate of 47 billion we've only rolled about $68 billion off because of low treasury issuance and other

idiosyncratic dynamics qt is going to be a real issue for the markets. what concerns me most is the liquidity element. we're seeing weak treasury auctions, sloppy bid/ask spreads. when they expanded the port foal to the level it did, dealer balance sheets, big u.s. security and treasury balance sheets didn't expand at the same time as the principle balance sheets so they don't have an opportunity to arbitrage some of that the outweighed size of those two things can cause liquidity strains that qt can be the element that sets that off we need to watch that closely as we enter the fourth quarter this year >> yeah, certainly looking in the background of a lot of discussions, including ours. david, darrell, thank you, guys. talk soon. >> pleasure. thank you so much. meantime, coming up on "techcheck," goldman's apple card business has a surprising subprime problem what that could mean for the stock coming up in the next hour don't miss "mad money's" huge

slate from seattle expedia peter kern with outgoing starbucks chief howard schultz and costco's ceo tomorrow. a big day still ahead. dow's up 300

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now is. welcome back to "squawk on the street." every sector in the s&p 500 as you can see behind me here, very much in the green. positive territory for all now, consumer discretionary is among the leaders so far today the leaders so far today within that group we're seeing some particular strength in some of the apparel names within retail including tapestry, formerly known as coach, ralph lauren, pvh corp., travel players like expedia, las vegas sands also rebounding as well. with perhaps more signs that inflation may be, may be cooling off a bit, names in a rely on consumer spending is getting a boost ahead of tomorrow's all-important inflation data i'll send it back to you, david, at the new york stock exchange >> thank you, dom. over the last couple of years many financial firms have

expanded their presence in florida, some have relocated there entirely now florida's red-hot luxury market is facing a new test. its private schools are bursting at the seams, causing a major backlog across the board joining us to discuss is dave faust, the head of the benjamin school in palm beach david, good to have you this morning. give our viewers a sense of the numbers behind this, how many students you typically admit and what kind of pressure you're seeing on admissions in terms of numbers and acceptances. >> good morning, welcome to sunny southeast florida. yeah, we've seen really since the pandemic, we've seen some pretty significant increases in interest in the benjamin school and other southeast florida private schools. and what i would tell you is in

the last couple of years, almost the doubling in completed applications there's a lot of positive interest in folks that are looking at moving down here to southeast florida. >> yeah, obviously we know, particularly the wealthier who prefer not to send their children to local public school, focus on a school like yours are you able to expand facilities or find teachers, dave or is it simply saying no to more people? we lost dave he's no longer with us >> it happens. we'll get back to that in the meantime we're monitoring the open, at least 4113, dow up 300 interesting to see equities and

the vix at the same time >> the vix is seeing that monday, it will build back a little premium, that's a normal effect we're on alert for the cpi mission. >> i think we have dave back from the benjamin school dave, i was asking whether you're able to meet this increased demand by hiring more teachers or increasing facility or whether you simply have to say no to more applicants. >> we've approached this really strategically and we've increased in size. our strength is a relational one, really knowing our families and knowing our kids we've approached this growth opportunity pretty strategically and i feel like we're very close to capacity now. but there will be some room in particular in the entry level

grade, to kindergarten, sixth grade, then again in ninth grade. and it has provided us an opportunity to perhaps be a little bit more selective in each class that we're building >> is it your sense that the peer group as well, the other private schools that you potentially compete with, are facing similar capacity constraints? >> yeah, i would say we've been really fortunate, we have a great tailwind now of families that are very interested in our area and whether it's the growing wall street south down here in west palm, or whether it's just a lifestyle choice, we've found people choosing kind of through the pandemic, who moved down and spent some months here and then decided to stay.

>> have you seen new activity in terms of private schools, whether nonprofit or for-profit? it seems this might be a crowd that might be entrepreneurial about it, if there aren't a critical mass of private institutions already for them to choose from. >> right i would tell you that every school has had some conversation about kind of what capacity is and what the opportunity for growth is. and, you know, there may be some, you know, movement, particularly in west palm beach, of a new player coming into the market we'll just see how that plays out into the future. i mean, i think right now everybody has -- >> yeah, dave, what's the annual tuition average at your school >> so it's a sliding tuition based on what grade. if you were to enter our high school, it's about $32,000

and obviously a little less for the lower grades, the elementary grades >> relative bargain compared to the rates up here. >> a bargain, absolutely thank you for having us. >> you're very welcome "squawk on the street" will be back after this

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checking in on the markets, we have a 1% gain in the s&p 500. the nasdaq outperforming another broad rally. also interesting, energy leading as crude oil bounces financials are also keeping pace with the index as it moves big mac ro picture, david, back in july was the prior peak and treasury yields are backing off. there is the sense out there that we've priced in a lot of leading indicators of inflation, for this monthly report it looks

like they could be benign. people are building up optimism that they'll get confirmation of that with the cpi number tomorrow big picture, 3900 to 4300 give or take in the s&p that will do it for us on "squawk on the street. "tech check" starts now. good monday morning, welcome to "tech check sfl." today, why activist investors are reversing course plus as internet stocks are hit hard, one wall street firm says amazon is best positioned to answer the call. then goldman's apple card business has a surprising subprime reporter. the cnbc reporter who broke the story will join the show first, steve liesman with breaking news from the