products from store shelves. we'll talk about the artist formerly known as kanye west it's wednesday, october 25th, 2022 "squawk box" begins right now. ♪ good morning, everybody. welcome to "squawk box" here on cnbc we're live from the nasdaq market site in time square i'm becky quick alongside andrew ross sorkin and joe kernen we're looking at record arrows the dow future's office by about 71 points, the s&p by 30, the nasdaq off by 192. some of the earnings results were disappointing

we're going to talk about that in more detail in just a moment. the nasdaq is the worst performer, again, down, by almost 200 points. this comes after a pretty nice run. the major indices has been on a three-day winning streak the dow up by 137 points, the s&p by 1.6, and the nasdaq 2.25%. check out the rebound for the month of october so far. the dow is actually up by 10.8%. s&p is up by 7.6%. the nasdaq up by 5.9%. so that's a pretty impressive recoverry for what people thought was going to be a pretty frightening month, the month of october. treasury markets right now looks like the yields on the 10-year, 4.65, the 2-year is at 2.55. >> alphabet missed estimates revenue growth missed from a year earlier

it missed expectations youtube added revenue of just over $7 billion is lower than the same quarter a year ago and shy of the 4.6 billion analysts expected google cloud revenue was higher than analysts expected the ceo emphasized the company's commitment to cost-cutting was intact, and they hired a lot of people that's going to slow, i think, at this point. >> yeah. >> the case of hire will become the slowdown in 2023 we'll talk microsoft too here's what i'm saying. >> tell me what you're saying. >> you don't see it in the employment numbers yet if you can't see things are starting to bite in -- maybe it's specific somewhat to -- but it's advertising, it's pc sales, it's window -- it's operating

systems you're going to talk >> it's chips. that's what t.i. was talking about yesterday. >> my only question is things were so crazy during the pandemic, this is the normal comedown or is it the fed's actions are already having an effect and we could take it as maybe not a posztive but another data point the swivel might be coming >> you will probably feel the swivel in march or april. >> from the fed, you mean? >> i don't know -- the question of who's impacting it, i think the fed is impacting the business on the one side of it. >> they're battening down the hatches, right >> does the fed look at it and say, what we see we're doing is having some effect >> i think the fed looks at the broader data points that come in and not necessarily anecdotal. that will be the complaint you

hear from everybody. the more recent numbers if you're really looking at those are going to show some significant slowing. >> i don't think it shows up i think in april we'll be talking about unemployment in a way we haven't been talking about it. >> the nasdaq didn't crush what's the dow >> up 10.9. >> it was down 76. it was almost -- >> the nasdaq, it's the high growth companies where you're going to is see the slowdown that's because the fed stops any potential high grouct and that's not going to be the case. >> you saw bitcoin what's going on there? it just didn't go down, so it's going up >> i still don't get what happens on the other side of thchlt now you're talking about what happened today, but 12 months from now. >> bitcoin >> no. >> from the economy. >> more broadly. are you in a -- is it great sledding ahead

no it's probably closer to this larry sumners secular stagflation kind of piece the year in anyway >> the punishment that you see on the tech stops, for youtube to have slowed by 2% and the stock to get hit this hard. >> advertising. >> right advertising slowdown and it's the first time since they started rolling out youtube numbers in 2019 you actually see any sort of a slowdown it's the first time the guys are going to feel the pain that normal advertising guys might have felt in the past. >> revenue keeps going down, even microsoft. >> let's show microsoft real quick. it is a bellwether of what's going on in the enterprise by the way, they're starting to get into business with netflix earnings beating estimates by a nickel here what happened

guidance disappointed. thigh've seen between $52.35 billion and $53.35 billion, analysts look for $56 billion. microsoft's azure cloud business slowing. not beating expectations as well another sign about the strength of in this case not just the consumer but, more importantly, businesses in this sort of b to b space. >> interesting details from the consumer the company's earnings beat expectations and payments volume at visa grew by 10% in the most recent quarter the tractions were up by 12% revenue rose by more than $1 billion to $7.8 billion, and the cfo says visa has not seen any consumer anxiety or uncertainty at this point and spending is still stable and strong almost everywhere in the world. the ceo said consumers may be

buying more generics versus brand names, but they're spending the same amounts of money and using the same ways to pay. he also said there's a penalty up demand for travel and employment remains strong. stocks up by 1%. >> and the stock price almost looks like berkshire chipotle, it's really pretty amazing. down on the day quite a bit. as you can see, earnings beat estimates. revenue is roughly in line same store sales grew 7.6% the company does acknowledge that lower income consumers have been viewing less frequently and that accidents the company's traffic. ceo brian nick ol' said the company saw min million resistance on higher price menus, prices on the menu, during the quarter, but in august the restaurant chain hiked prices for the third time in 15 months bringing it up.

it raised prices for a fourth time in october at 700 locations where it said there are pockets of higher nflation it's a $40 billion company now, and i'm just -- do you remember when it spun off from mcdonald's and why? >> it was supposed to be higher growth, right? that was the reason. i can't remember how good. >> why would that have been a problem to keep it part of the golden arches? >> i bet a lot of it is focus, focus, focus, you're part of a larger thing. >> and getting credit from wall street. >> would mcdonald's shareholders have made more would it have grown at the same rate, been able to run at the same way. >> could we if we could buy

stocks if our hands weren't tied so tightly it doesn't bother me -- >> you would buy every mexican restaurant stock. >> yeah. would i now have -- my retirement would be set because of chipotle? it was below 100 back then where is it? 1500 >> yeah. it's down from 1800 or something. >> when was bill ackman a big proponent of chipotle? do you remember? there with as period of time i don't think he's still in it i don't know. >> it's interesting. they say they raised price 13/% from the same quarter a year ago, but they also said their chicken burritos average nine bucks. so you're talking about something even if the consumer slows down, they're still able to -- >> and then there's the king, taco bell, where, you know, your family of if four, it's like $9.95 and everybody eats until they're full.

>> he trims his stake. that's bill ackman. >> how long? >> back in 20. he's still got the stock it looks like he's still got the stock. >> you know, you're supposed to buy whoo you like. it doesn't always work, but i could be the mexican food billionaire if i had been able to i would have bought them all across the board because the worst is great. when we come back, you like energy, you like gas. >> i like that too i have gas. >> live at the saudi arabian investment conference, davos in the desert she's going to give us her takeaways. we're going to get to dig in on what's really going on here. and as he head to break, a look at the squawk planner we give you a report on boeing, kraft heinz, norfolk southern. and meta platforms and ford,

earnings, and new home data sales at 10:00 you're watching swks on cnbc. >> announcer: this cnbc program sponsored by baird visit bairdifference.com ♪ ♪ ♪ ♪ ♪ ♪ introducing ihg one rewards.

seventeen hotel brands. six thousand global destinations. one loyalty program that lets you guest how you guest. at adp, we understand business today looks nothing like it did yesterday. while it's more unpredictable, its possibilities are endless. from paying your people from anywhere to supporting your talent everywhere, we use data driven insights to design hr solutions and services to help businesses of all size work smarter today.

so, they can have more success tomorrow. ♪ one thing leads to another ♪ millions have made the switch from the big three to the best kept secret in wireless: xfinity mobile. that means millions are saving hundreds a year with the fastest mobile service. and now, introducing, the best price for two lines of unlimited. just $30 per line. there are millions of happy campers out there. and this is the perfect time to join them... see how easy it is to save hundreds a year

on your wireless bill over t-mobile, verizon, and at&t. talk to our switch squad at your local xfinity store today. welcome back, everybody. our next guest had a wide-ranging conversation on the saudi relationship at the investment initiative conference

in riyadh known as davos in the desert helima croft is with us. helima, what did you learn >> i mean basically what we learned is a key priority, no surprise, for the saudi energy minister, is delivering on the vision 2030 promises to the population so when they think about the oil market, yes, they're looking to potentially backfill what happens in europe when the s six-pack launches, but they're going to be thinking about fulfilling their domestic priorities i think it's going to be an interesting set of negotiations between the white house and kingdom over how the kingdom uses fair capacity in the coming months >> what are those domestic inish ti tives? >> i mean basically they're promises to deliver new jobs to saudi citizens and they hope to be fueled by private investment.

for the king dochl, it's a key priority to deliver on the investments of young yawdies, social reform. that's a front-and-center concern. and think about the kingdom. we have the first davos in the desert, this was laid out. but we had the lean years in the oil market oil is the one thing funding key initiatives. saudi is probably going to be the fastest growing economy in the gdp. they're looking to employ these financial resources for domestic development. >> helima, what is the situation though we talk about how there are big tensions between the united states and saudi arabia right now. are there going to be tensions when saudi arabia steps in to backfill the loss of russian oil and gas in europe? i mean are they going to have tangs with russia? how does this get pulls. and where are the potential areas for cooperation? >> i mean, becky, that is the

key question for the oil market. now, the saudi oil minister pointed out yesterday that on multiple occasions, whether it be the first gulf war when we had the arab springs on libya, they increased production to backfill the recent outages. the saudis also pointed out they had been in active conversations with germany, poland, austria about potentially rerouting cargos to europe that is -- if you read the white house statements, that remains now the principal focus of the ask of the kingdom, will you essentially answer europe's call if they are facing a silg can't cut-off in supplies come december 5 but one thing i think the saudis are concerned about is they do not know how this price cap rollout is going to work are we actually going to see russian barrels move to asia because the price cap works or is it not going to launch as planned and we have a disruption

in the market? there's a lot of uncertainty what happens on december 5 when these sanctions take effect. >> going back to the early 2000s, it was note one of the reasons, i guess, radical things happened in saudi arabia, was because of the young people there that really didn't have much economic opportunity. it was all based on subsidies from the government based on oil. hard to get jobs i don't remember what the unemployment rate was, but that was always cited as one of the reasons why it was a difficult -- >> absolutely. >> has that improved now, and if it hasn't improved that much and if you don't have a diversified economy, if it's all oil-based and it's all from subsidies from the government, why should we expect anymore not to try to do what they need to do in terms of prices is it really a shot at the u.s., no, we're not going to increase

production, or is it something they're doing for their own domestic sort of necessities >> i mean i started my career in washington right after 9/11, and there was a tremendous focus on the security challenge what would happen in situations in the gulf where you had high youth unemployment, lack of social tuchblt you would have restless youth there's a security story behind when you look at the unemployment challenge they want to make sure their citizens, young population is loyal. focuse it's been key leadership that's focused on changing the model. you don't wait for a government job. they want to attract foreign investment. >> and is this conference doing that

is it setting up these opportunities? is there a lot of investment that's come in since the years it's begun >> what we have seen is their ceos coming here despite the sort of rift between russia and riyadh over oil policies we've had lean years i even seen a building boom in riyadh you've seen young people in jobs and ministriies who were not there before i do think they're very focused on the moment that they're in now, that they have more revenue coming in, and trying to deploy that revenue to really deliver on the vision 2030 promise that's going to be a key drive whenl they think about it, they're going to be thinking about their domestic priorities. >> helima, thank you >> thank you when we come back, a portfolio move you should make

today to avoid leaving money on the table. we have the details after the break. and later, more retailers, including ganld foot locker pulling the yeezy brand from store shelves after adidas ended its portfolio with yeah. we'll talk with a crisis manager at the bottom of the hour. while taking your mother and daughter on a once-in-a-lifetime adventure — your life is just as unique. your raymond james financial advisor gets to know you, your dreams, and the way you care for those you love. so you can live your life. that's life well planned. a kohler home generator never misses a beat. it automatically powers your entire home.

and keeps your family connected. and a kohler home generator with power boost technology does it all in seconds keeping your food fresh. and everyone comfortable. a heavy duty commercial grade engine with no refueling. and power to spare. it's ready whenever you need i. and,...it's quiet. even if you're not. when you've got a kohler generator, if the power goes out, life rocks on. right now get a free 10-year extended warranty and up to $750 off.

and it's easier than ever to get your projects done right. with angi, you can connect with and see ratings and reviews. and when you book and pay throug you're covered by our happiness check out angi.com today. angi... and done.

at fidelity, your dedicated advisor will help you create a comprehensive wealth plan for your full financial picture. with the right balance of risk and reward. so you can enjoy more of...this. this is the planning effect. all right. it's your last chance basically today if you're considering buying i bonds to work, not your last chance but the last chance for high rates they're government issued, government protected with

inflation shifts one of the shifts is coming up you can do it this week and lock in at the interest raut of 9.6%. but you have to complete that purchase by friday when the new rate is expected to drop to roughly 6 president 5% why is today really the last day? it's because it can take a day or two for the purchase to go through and you need a confirmation email by friday to lock in on the interest rate the downside is you're locked in for 12 months and if you cash in before five years, you lose interest you can lock in north of 9.6%. the real issue is you can only buy up to $10,000. you can take another $5,000 and buy it from your returns on your tax refund if you get those too. but it's really a great deal especially when you compare it to either cds or a savings account. meantime, some ipo news.

self-driving car unit. pricing its ipo at $21 a share. values the company at $17 billion, which is more than the $15.3 billion intel paid for the company in 2017 but far, far less than the $50 billion or many that the company had planned when it unveiled its plan for the listing late last year selling fewer shares than planned and landing cornerstone buyers for roughly 40% of the deal happening right here at the nasdaq. coming up, new polling data out this morning on how voters want washington to handle crypto, which goes back to around 20,600 even though the nasdaq is down a lot as we head to break, here's look at yesterday's s&p 500, winners and losers

>> announcer: executive end is sponsored by at&t business at&t 5g is fast, reliable, and secure al. nice, but i can't accept it. unless every business gets the best deal. on every iphone. uh, actually... we already do that. the plumber with the ascot! big bjorn, little bjorn, too! the caterer who really cares. every business should get the deal! we make a good team. every business gets at&t's best deals on every iphone. including up to $800 off iphone 14 pro. (♪ ♪) this thing, it's making me get an ice bath again. what do you mean? these straps are mind-blowing! they collect hundreds of data points like hrv and rem sleep, so you know all you need for recovery. and you are? i'm an investor...in invesco qqq, a fund that gives me access to... nasdaq 100 innovations like... wearable training optimization tech.

uh, how long are you... i'm done. i'm okay. as an independent financial advisor, i stand by these promises: i promise to be a careful steward of the things that matter to you most. i promise to bring you advice that fits your values. i promise our relationship will be one of trust and transparency. as a fiduciary, i promise to put your interests first, always. charles schwab is proud to support the independent financial advisors who are passionately dedicated to helping people achieve their financial goals. visit findyourindependentadvisor.com

good morning welcome back to "squawk box. we're live from the cnbc headquarters at market square. the nasdaq that's facing more pressure it's down by about 186 points, of course, that comes after weakness in the earnings report and the outlooks from some of the big tech companies after the bell last night. in the meantime barclays reporting an unexpected rise thanks to strong trading revenue. performance and currency and commodities trading particularly strong the bank also saw an increase in net margin error the stock down by 1% this morning. there are shares of spotify also lower the quarter loss was worse than expected

users was up 20% year over year. 195 million paid subscribers was an increase of 13% spotify says its added revenue was driven by 92% year over year they began offering audio books in september the stock is off by 5.25%. new polling data in what voters want to see in terms of crypto and regulations ylan mui has more. good morning. >> that's a finding from a new poll out today from the crypto council of innovation whose members include coinbase, fts. it found a third of voters have a favorable view of crypto compared to 40% who are unfavorable, and more than half the voters said the industry needs more regulation. only 7% say it should have less.

however, voters are split with each split in half one key is how well crypto polls with young people and black and latino voters. more than a third latinos said they would be more likely to vote for a candidate who's positive on crypto one of the main reasons that voters overall are excited about crypto is the ability to reach the unbanked the other is it's rolled as an alternative. so guys, 41% thinks that crypto does have a lot of potential but has yet to deliver, and that is true for republicans, democrats, and for independents back over to you. >> i don't think anything you said surprises me actually it all -- i guess i would have probably expected numbers very similar to what you just said, given the -- you know, what we've seen over the past 10

years. you ultimately see all the promise and at the same time you see all of the pitfalls that come with something that's so n new, i.e., matt damon, do we like him or not like him at this point? the stadium is named after crypto. >> yeah. >> it's bizarre. >> one thing that was interesting in this poll is just the number of voters who say that they own crypto, something like 13% again, that was across the board, republican, democrat, independent, so those holdings are pretty significant, more than a number of people who said they owned commodities, etf funds. the other big takeaway is how the company it should position itself voters want regulation to be able to create a safe and stable market so that the public can invest this is really sort of the motivating factor of what they

want to see out of washington rather than competition with china, being the global leader in finance americans really want to see washington take this role of creating stability in the crypto markets because clearly what we see from this year is that's been lacking >> right and then crypto's got such a wide range what's the dogecoin. there's bitcoin and the other side of everybody else. >> right, right. the other knowledge rate or understanding rate or pickup rate for other terms like web3 or digital asset or nfts the republican voters are very low in understanding it's become sort of the catchall for the entire industry eechbz though as you and i know, it's very differentiated. >> okay, ylan, thank you. okay we've got a lot more coming up on "squawk box." we're going to talk about google and microsoft.

those shares are dragging down the nasdaq futures this morning. we're going to dig through the reports and guidance and what it means to the economy later we're going to hear from the former cirha joe moglia. if you don't have the cnbc app, go download it we're back after this. okay season 6! aw... this'll take forev—or not. do i just focus on when things don't work, and not appreciate when they do? i love it when work actually works! i just booked this parking spot... this desk... and this conference room! i am filing status reports on an app that i made! i'm not even a coder! and it works!... i like your bag!

on "squawk box." go download it that's why the world works with servicenow. on "squawk box." go download it

missing top and bottom lines specifically youtube's ad revenue also disappointing that's sending a little bit of a shock wave about where the economy really stands given that adver adver advertising is a bellwether. the cloud revenue growth guidance came in well below estimates. let's break it all down. sarah kuntz is here. good morning to you. sarah, how much should we be concerned, not concerned what's your headline here? >> i think we've all be concerned for a while, and i don't think that's going to change ade sales are in for a rough ride right now

they're really down because people aren't getting mortgages right now. you look at the reality. tiktok is hurting. through the holidays when you have people finding their gift recommendations for tiktok instead of youtube, that means fewer ad dollars will alphabet be fierngs yes, is this going to go away, this advertising problem, not in the short term. >> so what do you think is a fair value for alpha get shares right now? we're looking at it 9826. >> you know, the p.e. ratio isn't unreasonable it's pretty close to a 52, you know, week low but when you look at the past few years, it's gone up a lot. i don't think apple is a bad price. i don't think it's quite on zero, and i certainly don't think it's going to go to zero. >> let's flip around and talk about microsoft, clearly an

indicator of the b & b business, the enterprise world it's slows from 35% to 30% hour concerned does that make you? >> everything is slowing from microsoft. nothing is coming up pc sales are down badding and that hurts microsoft, right? 've with things like linkedin, that's about job openings. not a lot of people are hiring right now. azure has really seen a slowdown and it's signaling that they think there's going to be even more so i don't think that microsoft is in for, you know, a good rest of the year and potentially not a good year next year either. >> so you look at that stock price now down about 234 what do you think the fair value for that company is? >> again, you don't have an unreasonable pe ratio compared

to peer sales. these are long-term macro trends that they're catching the brunt of. >> if i gave you $10,000 and told you you had to buy tech, what would you buy >> thank you for the $10,000 you know, i think i would really look at potential take prooivat targets like the pelotons and real reels. >> really? that seems like quite a proposition that it might go private. some think it might go the opposite direction. >> i think you buy for two things i think you find a novel company that's doing something interesting. but they're sort of losing their way in the public markets. i'm a risk adventurer. we saw that with poshmark and

that's a bet that's paid off big for people >> sopel on the is $7.42 and you like it. >> i don't love it they've put a stake in the ground if they can't make it neskt year, they're going to look aggressively at sales. i don't think it's out of line to say that samsung or apple could look into it it could be a good business fit and their fit business like the apple watch and in a few years we could afford it. >> i want to go back to the realreal there's a question whether the business model of realreal works ever. >> as a stand alone company, it works. it's very, very low in the market cap the reality is people are still using it people are still buying.

people are still selling you know, it's an ldmh who makes a lot of the products that have sold on the platform and they're getting into resale. if they decide to make a move there or similar company or -- >> the reason is because it loses money still, right >> it loses money as a p the consumer likes the idea they can sell something and go back and buy the next thing, right? the sustainable people want it as well. there's value there. the question is it a company that you could make your money back it doesn't look like that way. are they going to stop buying and selling luxury no it has to go somewhere so i think there's the potential of an interesting exit. >> sarah bringing some provocative views. alphabet and microsoft may be

overpriced, it sounds like the realreal and peloton may be your bets. i don't know i don't know sarah, we'll have to have you backes and see where things stand. thanks >> coming up, major retailers, including gap and foot locker, cutting ties with kanye west there, i said it i'm not going to try to figure re out anymore, ya, ye, i don't ca. follow squawk pod on your favorite podcast app and listen any time we'll be right back.

[watch: heart monitor connected.] technology makes it easy to connect to everything from your wrist. [watch: speakers connected.] but to connect to all your clouds, you need more than technology. [watch: 50 feet to pin.] well that's not fair. you need cdw to implement vmware cross cloud services. a portfolio of multicloud solutions. it'll simplify workflows, speed innovation, and secure all of your applications. how did you get here?! [watch: the backdoor is open.] vmware makes connected multicloud possible. cdw makes it powerful.

we're told that success is all about making it on your own. the truth is... need some help? c,mon, get in. nothing great gets done alone. that's why there's shopify. with shopify, you can set up your online store; you can sell on social media; or, you can sell in person, with our point of sale system. it doesn't have to be lonely at the top. join the millions to find success - on their own terms. start your journey with a free trial today.

welcome back to "squawk

box. stocks to watch this morning take a look at texas instruments. they're falling. investors focused on the guidance really. the company expecting declining sales in the current quarter, executives warning most of its end markets would decline sequentially, that's except, though, the ought moe active market. also new this morning, universal resorts closed in beijing due to covid no word on when it will reopen, but the park said it will refund or reschedule the tickets. the theme park owned by our parent company comcast yesterday beijing reported 19 asymptomatic cases you want to understand why the economy of china is struggling the covid policy is a good answer. >> here we go. adidas ending its partnership with kanye west after the star made a series of anti-semitic comments shortly after gap said it would remove

yeezy products from the stores and shut down yeezygap.com eric dezzen hall, i don't know where to start, eric, i really don't, because it's -- you know, you've done crisis management. a lot of times things happen that seem, you know, accidental. i don't know how do you even characterize what you've witnessed over the past month do we attribute it, really, to some type of, i don't know, something that maybe a psychiatrist needs to weigh in on >> it depends on who the client is if you're one of these large companies, these companies are not set up to manage crises. they're set up to make and sell stuff. you cannot imagine the extent to which something like this disrupts management from the top

to the bottom. they simply are not in a position to sword fight the way they might be in a marketing or lobbying campaign. the only thing they can do, especially if you're dealing with a german company, is to get rid of the person immediately. and talking about kanye, one of the reasons why a smarter crisis manager will get out of the celebrity business, if he or she is saying, is because you can't advice people like this. whether their mentally ill or not. what their life experience has taught them is they are right. and why would they listen to someone who will earn in a lifetime what they made yesterday? so you really cannot advise someone like this. and i wouldn't go so fast with just attributing it to mental illness. you're not dealing with an errant statement you're dealing with a guy who has expressed an entire

portfolio of thought about the jewish people and this is not something you can explain way by saying oops. there's plenty of people who suffer illness who don't lay out an entire system of thinking >> and then i guess when you enter into a really important business relationship is when you need to consider these things but i don't know whether that was done you make some good points about that expression is absolutely power. i think fame and fortune corrupts absolutely too. when you're at that point, you always think you're right and you don't consider the ramifications of what's just happened. >> why would you >> because you don't think he's considering it now, eric

>> well, i think that the person, the principal of a crisis like this is the last to realize the situation they're in because they're learning late in life the facts of life where they've never had to learn them before and it is a very difficult conversation to have i've had these conversations over the years with these people and in a perfect world, what would happen is they would say, you make a good point. what they're really saying is, who is this nobody from nowhere to tell me what to say who is he? and look at me i'm a billionaire. and so the process by which you get to that point is something that takes a very, very long time, and these people are constitutionally incapable of helping themselves because of what their life experience has taught them. >> do you see any path back? >> sure. this is america in almost 2023

he vanishes for awhile, he apologizes, and maybe there is some cohort of people who like him and who may even agree with him and he can have a path back there. i don't rule anything out given the shortness of memory that you have with something like this. however, this is a man in the entertainment business and i know -- i would not be running around looking to make an enemy of ari emmanuel if i wanted to stay in the entertainment business there are going to be some hurdles, but the variable of time is going to be the most important one. >> i don't talk to ari about it. i think mel gibson -- mel, somehow was able to get back to the point where ari is at least speaking -- i don't -- >> well, mel -- >> i can't imagine touching the third rail

it's like pressing the nuclear button to go there it's just hard for me to imagine how you -- even if you do think you're always right, it makes you wonder you got to be out of your mind >> i think that's some of it but, again, we're getting to a point where we are writing everything off to mental illness without understanding that a vast majority of people who suffer some sort of mental illness are very decent people who only bring pain to themselves and those around them but you're dealing here with a very extensively articulated series of thought as opposed to mel gibson woz -- i'm not defeng him, he was likely drunk and spouted out very, very quickly a few epithets, but that's not

what this is. >> eric, let me ask you this i know you're saying you don't want to take him on as a client. somebody calls you and says, you got to do. what would you do, would you say, you got to wait 12 months, 24 months, a year? is there anything -- i'm not trying to rehabilitate the guy but that's the business that you live in. >> it's a fair question, and the answer would be, number one, shut up. that is the hardest thing to say to people in this day and age who calibrate their worth by visibility they don't know how to shut up if he does shut up and come back at some point and do the ritual apology, blame it on mental illness, i think that would probably make some dent in it. but you're dealing with a function of degree you're not dealing with -- i mean, there's a reason it's called crisis management not crisis vanish. these things don't vanish. in a year or six months, he

could do an interview, blame it on mental illness and begin the process. >> right you're right about that. right about mental illness too a lot of people -- you see the act itself and say, well, they must be mentally ill i think of, i don't know, whatever you want to think of, murder, serial killer. they got to be mentally ill, look what they did and sometimes that's too pat an answer they knew exactly what was happening. >> yeah, but i think there comes a point, look, we're dealing with school shootings and things like this. at some point you have to say, okay, this person should not have access to a weapon or this person needs to be punished. >> right it's clear. >> something like that look, most of us have something. >> right exactly. okay, eric, eric dezenhall if they call you, i think you would take the job. >> first of all, he's not going to call, especially after this

area this is not the kind of area -- i don't want to be anywhere around it. it's better dealing with corporations who have flaws but they tend to be groupups who have the capacity to listen. >> thanks. when we come back, wealthy californians could soon face billions of dollars in new taxes. we're talk to ro khanna about the ballot initiatives that could add weight to an already heavy tax burden tech stocks under pressure you're going to see alphabet shares off by 6%, microsoft off as well. "squawk box" will be right back. n in just two days. new crepe corrector lotion only from gold bond. champion your skin.

good morning tech tumble. disappointing reports and commentary from alphabet and microsoft pressuring stocks. this hour, we've got numbers from dow component boeing. and breaking economic data, a new read on mortgage rates and the housing market. less than two weeks until the midterm elections. we're going to talk about the issues on the ballot most important to investors and business leaders the second hour of "squawk box" begins right now

♪ good morning welcome back to "squawk box" right here on cnbc i'm andrew ross sorkin along with becky quick and joe kernen. take a look at u.s. equity futures at this hour we've got some red on the screen some guidance coming in light on the microsoft side assu some of the news out of google the dow off 16 points. nasdaq down about 182 points and the s&p 500 off about -- we'll call it 24, 25 points. take a look at treasuries as well becky was talking about i-bonds earlier. i got to do that ten-year note at 4.063 two-year note at 4.447 >> 4.06 is good. >> yeah.

lower. lower, good for equities. >> but it's not enough because we're talking about alphabet and microsoft all morning, google's parent company, earnings and revenue coming in short of estimates and basically more importantly, i think, youtube ad sales. that's what's disappointing wall street >> microsoft topping estimates for its latest quarter, but the guidance came in weak and tonight we're going to focus and turn our attention to meta we'll hear from them which will post results after the closing >> let's get to frank halolland >> you sound so surprised. we have earnings this morning. we're going to start off with hilton shares moving higher this morning after a beat on eps and a slight miss on revenues. the hotel chain issued guidance that was above estimates it added almost 13,000 rooms as travel demand remains strong it was an important quarter for their recovery boston scientific moving lower this morning shares down 1 1/4% after a miss

on eps they're facing demand issues currently. whirlpool is trading lower after bank of america downgraded the company. shares are down almost 2.5% right now. shares down 35%. obviously, appliance demand being impacted somewhat by the slowdown in the housing market back over to you guys. >> frank, thank you. the feed meeting is set for next week and sherrod brown is reminding jay powell that he has to think about the politics. steve liesman joins us right now with that story. steve, we knew the calls could come and here they are. >> and so it begins, becky up until now the fed's aggressive rate hikes have generated little political opposition, but a letter that

sherrod brown sent yesterday to jay powell suggests all that could change brown telling powell, i ask that you don't forget your responsibility to promote maximum employment and the decisions that you make at the next meeting reflect your commitment to the dual mandate it raises a lot of questions first, to the extent which politicians should be trying to influence policy while brown's comments were gentle compared to those of president trump's, they did the same thing they leaned clearly in the direction of urging the fed to do less. the fred has cranked rates from zero to what is likely to be just under 4%. the economic survey, found the public is divided on much more important, jobs or inflation 47% saying, jobs are more

important. and that divided result, which, by the way, is close to the poll's margin of error, it comes with unemployment at 3.5%. a near -- 50-year low, anyway. there was little difference between republicans and democrats and it comes with the rate at that 50-year low it's not hard to imagine bipartisan opposition to fed rate hikes if it leads to millions losing their jobs we'll have to see how the fed reacts in that context if inflation remains high. >> i mean, this is pretty concerning stuff the administration at this point, the biden administration has been hands off and they reiterated that again yesterday, or maybe it was earlier this week just -- we're not going to be part of this it's -- it is the fed's job to do this and we're going to stand out of the way sherrod brown really doubling down on this and that does put the screws to it especially because of the committee position he holds. >> i think that's right. and, you know, i just -- on the

one hand, i'm divided on this. i was divided on it when the -- when president trump spoke as well although not necessarily divided about president trump's language, but the gist of it is, you kind of have a right to speak and say, you know, there is this dual mandate they can be in conflict. it's okay to express yourself. on the other hand, congress created the fed as an independent institution to handle monetary policy and it should generally be hands off. i think it's interesting, becky, when i looked at the cross tabs on all of this, republicans and democrats are kind of pretty much the same on this issue of what's more important here it's, by the way, the independents that are concerned about inflation rather than job. >> speaking of inflation, another part of senator brown's letter blamed big corporate profits for inflation. >> yeah, we'll see how much legs that issue has profits have held up

i think we've all -- on this desk here have been surprised at how well companies have been able to raise prices and maintain profit margins. obviously, some of that is under pressure this quarter. i don't know what congress can do about it. i think it's more interesting lead points to the issues of whether or not we have certain monopolies in this country, how competitive the economy is, especially if profits remain high and prices remain high while input costs decline. that's not the time to gauge that right now, i don't think it's a big political issue. it's something more that democrats have raised. >> what i was going to ask you is, do you think that politically in a recessionary environment or let's say a challenged economy, depending on whatever you think this is at the moment, that there would be an appetite to either break up companies or do things that

would be considered, you know, more aggressive from an antitrust perspective in the name of competition. >> i think there could be, depends on, you know, which administration is in power i think a lot depends on congress i think that we do -- there has been research about declining competitiveness, especially in rural areas. we've talked about that issue, andrew, which is the monopoly that a person has on buying something rather than selling something. in this case it's on labor that has led to stagnant wages in rural areas. i think all of that needs to be looked at as a general course of the government guiding the economy and not necessarily as a political thing. >> i agree with you. the issue -- >> the best thing the government can do is to make sure that the economy remains competitive. that's the best thing for the capitalist system -- >> the reason i'm raising the question in the context of a recession or a challenged economy is to the extent that

the u.s. government should be more aggressive about antitrust policy, you would want to do that at the top of a cycle rather than the bottom of one, given the short-term impact that would be -- of pain that would come probably from some of those breakup efforts or other types of competitive restrictions, no? >> right i agree with you because one of the things that companies want to do in tough times, you end up having mergers to gain economies of scale and maintain profitability and competitiveness in your market you're absolutely right about that that could be something. and layer on that, the issue of -- how good is powell going to be at holding down the fort on this issue of keeping raising rates if unemployment rises. >> that's a fair question. and one that we'll be seeing about an answer. thanks. >> and what i'm referencing is, we're going to have attorney

general to talk about kroger/albertsons. are they going to make inflation even worse by -- >> this is the question, right >> so we're going to have him on. >> that interview is coming up in a terrible market, you don't want to do it because you don't want to hurt anybody short term. at the top of the market you don't want to do it. breaking news on mortgage rates and the housing market we'll bring it to you. take a look at futures right now, we are in the red this morning on the back of those earnings reports from google and also from microsoft. we'll hear from meta later today. as we head to a broke, check out this morning's biggest nasdaq winners and losers stay tuned, you're watching "sawbo oy cc.quk x"nlonnb >> announcer: this cnbc program

is sponsored by baird, visit bar bairddifference.com.

our internet isn't ideal. my dad made the brillant move to get us t-mobile home internet. -which... we have to share our signal with the entire neighborhood. yeah, now we do some weird things to get our speeds. well... i'm up. -c'mon kids. this sucks. well if you just switch maybe you don't have to be vampires. whoa... -okay, yikes. oh sorry, i wasn't thinking. we, uh, don't really use the v word. that's kind of insensitive. we prefer pro-lunar.

yes, much better. pst. girl. you can do better. at least with your big-name wireless carrier. with xfinity mobile you can get unlimited for $30 per month on the nation's most reliable 5g network. they can even save you hundreds a year on your wireless bill over t-mobile, at&t, and verizon. wow. i can do better! yes you can! i can do better, too! see how easy it is to save hundreds a year on your wireless bill over t-mobile, verizon, and at&t. talk to our switch squad at your local xfinity store today. welcome back to "squawk box. news alert bed bath & beyond naming a new ceo. joe? flat quarterly results hitting the tape in the last few

minutes. kraft heinz topping consensus. harley-davidson, shares are also up they've been having, like, it seems like issues -- no, i thought they've been having quite a few issues trying to get young people into the whole harley brand as all the harley types age, basically >> all right here's one for you beer drinkers may still enjoy hoisting a few, but they're doing it less often, at least in europe h heineken says they're seeing a slowdown overall sales did rise by 8.9% from a year ago, but analysts were looking for a 12% increase. the weakness in europe was offset at least in part by

strong sales in asia that stock is off by 8.3% this morning. >> breaking news on the mortgage markets. diana olick joins us with the details. >> joe, not quite halloween yet, but the numbers are getting even more scary how about demand from home buyers dropping to nearly half of what it was a year ago in total command at the lowest level in a quarter industry. the average on the 30-year fixed rose for the tenth straight week crossing 1% on the index we saw it on the other daily reeds last week, but it hit 7.16% from the weekly average. refinanced amount, which is most rate sensitive, flat for the week, but only because it was down 86% from a year ago right now, there are less than 150,000 qualified borrowers who could actually benefit mortgage apps to buy a home and

were 42% lower than a year ago. the only increase in application demand was in fha loans. they offer slightly lower rates, but you have to pay mortgage insurance and the applications remained high as well. >> thank you for that report we're going to continue talking about this rising rents across the nation are also hurting consumers and contributing to decades' high inflation. our next guest is our ceo of built rewards which renters can earn points on rent by putting it on their credit cards he announced a new funding round that values the company at 1 1/2 billion dollars. it was led by left lane capital, wells fargo, chamber creek and

others when you first started this company you came on this broadcast and it's cool to see the growth of what you've created here >> look, i mean, i think -- we talked about inflation this morning. there's nowhere that young people are feeling it more than rent, right? and i think the business growth over the last 12 months going from 0 to a billion and a half is a testament, if you're living in the city and you're renting, rent is taking up -- supposed to take up 30%. it's taking up closer to 50% of people's income in so many places they talked about the cpi going up 8%. if you look at -- it's not just new york, pittsburgh rents went up 15% year over year. and so for young people, this large expense is going to become the biggest driver of decision-making, whether that's things like where you get rewards or what you have leftover to spend on any other

category i think it's a critical indicator that we look at as we look at consumer spend. >> you mention add couple cities where the numbers are through the roof is that true everywhere? are you seeing any pockets where you're seeing a shift? >> we're getting a double whammy rent prices are up over 9%, but in cities it's up closer to 15%. yesterday, andrew, we launched this new product which allows renters for the first time to see what can you buy for the same amount you pay in rent. that simple question has been really hard to answer before and so this morning i was looking at the cal cater, at 7.1% interest rates, a $4,100 a month mainstream which is the median payment in new york city, can only buy you a $495,000 home you have people unable to buy and move into homeownership,

putting more pressure on the rental market and as that continues to grow, prices, again, that's going to be the most important indicator to watch if you think about what happens in the next year if we hit a recession. if people have no free cash flow following their rent payments, that's going to be the biggest challenge. >> how concerned are you given what you do for a living about that component part of this. a lot of people you serve are putting their rent on their credit card. it effectively creates the potential for ownership in the future, or at least credits towards ownership in the future. but at the same time, if you put it on your credit card and interest rates go up and you can't pay your monthly bill, you're paying more for it. >> to give you quick context, built is the loyalty program

you're building credit with every on-time rent payment and earning rewards that you can use. today most people are earning points and miles on all of their own spend. when you pay rent, which is the single biggest expense, you've gotten nothing back. our thought is, at the minimum, while rent prices are rising, can we help this generation build their credit so they have access to homeownership and can we give them enough points and miles so that paying rent allows them to get the benefit of traveling or other things they may want to do which otherwise you may not be able to afford. >> what are you seeing in terms of payments? they're paying their rent on the credit card and i'm assuming that some are paying it in full at the end of the month and some are not. are you seeing a shift in that >> yeah. people are actually more -- paying off their -- bilt is an everyday card, rent, dining travel we're seeing better credit rates

than other typical comparable cards because rent is something that people have baked into their budget when you think about it, other cards, they're saying, pay your rent, here's a credit line go spend elsewhere, and then hope that after rent, you still have enough to pay it back what we're finding is because people are able to earn credit history and rewards on their core payment that they've already budgeted for, we have a much better pay back than traditional cards and we're finding it's more value given in this new generation. they think of credit cards as a spend tool >> it's exciting to watch and we look forward to talking to you soon. dow component boeing set to post results just within the next couple of minutes we'll bring you the numbers and the market reaction. first, as we head to break, check out some of the morning's big movers following their big

results. spotify posted a larger than expected loss. mattel shares sliding. toymaker cut its profit forecast and plans to increase promotions during the holiday season to offset inflation-induced consumer reluctance, it says here stay tuned you're watching "squawk box" on cnbc >> announcer: now for today's aflac trivia question. according to the national pasta association, how many pounds of pasta does the average american eat per year e answer when cnbc "squawk box" continues look at the size of that- gaaaaaaaaaaaap!!! is that a goat?! you talkin' about me? gaaaaaaaaaaaap!!! i think this goat is saying “gap.” must be talking about the expenses health insurance doesn't cover. so who's talking about the money aflac pays to help close that gap? gaaaaaaaaaaaap!!! aflac! aflac! gaaaaaaaaaaaap!!! it's about to go down, baby! aflac! aflac! stop that goat!

get help with expenses health insurance doesn't cover at aflac.com

♪ ♪ get help with expenses health insurance doesn't cover connecting to opportunity is just part of the hustle. ♪ ♪ opportunity is using data to create a competitive advantage. ♪ ♪ it's raising capital that helps companies change the world. it's making complicated financial concepts seem simple. opportunity is making the dream of home ownership a reality... ♪ ♪ ...writing new rules and redefining the game... ...and driving the world forward to a greener energy future. (applause) ♪ ♪ opportunity is setting a goal... ...and charting a course to get there. sometimes the only thing standing between

you and opportunity... ...is someone who can make the connection. at ice, we connect people to opportunity. ♪ ♪ no more waiting. no more running. [ screaming ] we finish this tonight. >> announcer: now the answer to today's aflac trivia question. according to the national pasta association, how many pounds of pasta does the average american eat per year 20 pounds. global investors focusing on the political headlines coming out of china this week eunice yoon joins us live from beijing. what's the latest?

>> reporter: well, becky, various government departments appear to be attempting to repair the damage done to the markets by the outcome of the 20th party congress. president xi now dominates the leadership team which suggests that we'd see a continuation of the zero covid policy as well as other state-led economic policies today, state media was featuring several announcements such as the need to woo foreign investment, new support to foreign firms, more incentives for private businesses and now the messaging appears to be more favorable to investors, but investors here today reacted to what the government actually did today. and that is that several cities locked down districts, buildings, as well as certain areas around the country wuhan, for example, one of the districts is back in lockdown.

iphone city, tightened restrictions, once again, and beijing, macao and xining shut down certain areas guys >> thank you very much you can see there as stocks a little higher overseas this morning after some punishing losses yesterday still to come, we're awaiting results from boeing that's coming in a couple of minutes. we will bring you those numbers and the instant market rctn.eaio the stock is flat ahead of the release.

the new iphone 14 pro is amazing. the camera is incredible. and you'll get our best deal. nice, but i can't accept it. unless every business gets the best deal. on every iphone. uh, actually... we already do that. the plumber with the ascot! big bjorn, little bjorn, too! the caterer who really cares. every business should get the deal! we make a good team. every business gets at&t's best deals on every iphone. including up to $800 off iphone 14 pro. (♪ ♪)

♪ good morning welcome back to "squawk box. take a look at the futures right now. these are turning around a little bit with the dow. up now about six points. we were in the red before. nasdaq still off 174 points on the back of those earnings from alphabet parent of google and microsoft guidance coming in light we're also seeing the s&p 500 dropping as well take a look at the ten-year. it's at four we have boeing's earnings just crossing as we speak. >> andrew, this is a big miss for boeing for the third quarter. reporting a loss of $6.18. that's why shares are tanking right now. the expectation was for a profit of 7 cents revenue coming in light of

expectations the street was expecting 17.76 billion. so why the miss by such a wide margin from boeing they're taking a massive number of charges, a total of $2.8 billion in charges all related to five defense programs these are fixed price programs that boeing is taking these charges for in anticipation of losses to be expected over the next couple of years with these programs we're not going to run down all of the programs. but the two largest charges are for the refueling tanker and for the new air force one. two of those that are being built by boeing. remember, they took a charge on air force one back on the first quarter. now they're taking another charge this is in anticipation of future losses over the next couple of years. as for the third quarter, there is some bright news if you're a boeing investor in terms of the operation, especially on the commercial airplane business the free cash flow came in at $2.9 billion most on the street expected

about a billion dollars in free cash flow. operating cash flow, also better than many were expecting at $3.2 billion and a letter to a employees, the ceo says we remain in a challenging environment because of what we're seeing with inflation, trying to bring inasmuch labor as possible which is a challenge for boeing and other manufacturers. the cash balance stands at $14.3 billion. they're not doing guidance with the exception of reiterating their full-year cash flow being positive cash flow for all of 2022 in terms of eps guidance, et cetera, boeing hasn't done that at least in -- in a year, two years. that remains the case. we're going to be talking with dave calhoun coming up at 9:00 a.m lots to talk about with the boeing ceo again, this miss of $6.18, a loss of $6.18 versus an expected profit, it's completely driven by a massive charge of

$2.8 billion again, to cover anticipated losses with five defense fixed price programs guys, we'll send it back to you. >> phil, that loss obviously a much bigger miss a huge miss just on the bottom line but the top line was a couple billion dollars short too, i think. >> correct and that's the impact of this too. there's an impact when you take a loss of this size that is also reflected on the revenue side. >> okay. that was my question right now the stock is down by 2.1% we look forward to that interview later this morning thank you, phil. >> you bet. i want to bring in stephanie link, and stephanie, i think you're in the unfortunate position of owning shares of boeing does this surprise you does it change your opinion on things, or is this something that you can weather >> i think this is something that we can weather. i think the absolute highlight and free cash flow that's what this stock trades

on for it to be double the expectations, that's a positive surprise on the defense side, not good news to take another charge. but as soon as i heard the word charge, i thought, oh, no, another commercial aerospace charge right? it wasn't. in fact, we do know that demand for new aircraft is very strong. just in the third quarter alone net new oem orders for the industry were 600. we know there's demand there after market, global flights are running up 11%, up 14% year over year and we saw ge yesterday, their aviation business grew 25% so if you own it for the commercial -- if you own boeing for the aerospace business, then i feel pretty good about the demand and the cash flow numbers and, unfortunately, the defense is just -- is hitting the headline numbers but i'm not as concerned about that >> but you're concern would be if they did have to take additional charges on the

commercial front we know the demand is strong we know that all of these commercial airline companies want these airplanes i guess the question is, how long it takes to deliver and what you have to give to those airline companies in the meantime. >> that's exactly right. on the call, let's listen for the 737 max, can they get back to delivering 50 planes on the 737 max a month? can they get back on the 787 to get to five to seven planes delivered per month? if they can, that only helps the free cash flow story, right? and so that's what we're going to be listening to that's very important. again, the cash flow number is on the right trajectory and i expect they have an investor day on the first of november, just right around the kosh. i suspect we'll get more detail on the delivery front on the analyst day. >> we're also going to be

hearing from meta after the bell today. that's another stock you own and the shares are under pressure this morning already because of the news we heard from youtube at alphabet just the idea that advertising revenue is slowing down, seeing that happening in other places i guess this is a little bit in sympathy for what's happening there. that stock is indicated off by about 4% >> yeah. you're right it's exactly what you said in terms of youtube youtube decelerated 7% and it was much worse than expected that's a great read through, unfortunately, or a bad read through for meta digital ads we're expecting to be down about 5% we know about competition, we know tiktok, the slowdown in the macro. the stock is down 60% year to date on the positive side, engagement is going to be pretty good at 1.98 billion for daily active users. i also think that you're going to see some progress in reels. it's not going to be fixed but i think you'll see some

progress and the one area where they have kind of the flexibility in their business model is on the cost front. these guys have been spending like crazy over the last many years. and so i think they can cost as much as 10% and that will help, i think, on the bottom line. it trades at 11 times earnings as well. i think it's reflecting a lot of bad news already >> the stock is down 60% year to date is it too late to sell >> i know, yeah, no, i feel like i want to go to other way. i want to add. let's get this quarter over. the macro is hurting the entire industry a lot of bad news is priced in but i believe the company has the size and the scale eventually when advertising comes back, i think digital advertisers are going to want those eyeballs because that's where you see the return on investment much more than traditional advertising. we have to stay patient.

it's been painful. but i believe in the long-term story. >> we got to run what would it take to convince you to buy more shares of meta is there anything they could say today? >> yeah, if they cut costs more than expected, thenn i think they're getting religion in terms of what the reality is. >> thanks. ro khanna in studio on the election day ballot issue, investors and business leaders care about, taxes much more. as we head to break, check out this morning's biggest premarket winners and losers stay tuned you're watching "squawk box" on cnbc

thanks to avalara we can calculate sales tax on almost anything, anywhere, automatically. avalarahhhhh. what if tax rates change? ahhhhhh. filing sales tax returns? ahhhhhh. managing exemption certificates? ahhhhhh. business license guidance? ahhhhhh.

does it connect with accounting? ahhhhhh. item classification? ahhhhhh. cross-border sales? ahhhhhh. what about? ahhhhhh. ahhhhhh. do you have those budget markups? thank you. mmhm. [bubbles] how will your business adapt to change? you could hire an office full of peyton mannings. what's up, peyton? good morning, peyton. hold for peyton. they'd huddle.... welcome to the peytonverse. such a visionary. game plan... you go. no, you go! and call audibles... double our investment in omaha! omaha!

omaha! omaha! or you could use workday. omaha. the finance, hr and planning system used by over half of the fortune 500. for a be-agile-like-an-mvp world. workday. for a changing world. welcome back to "squawk box. futures right now, we tried to trade higher on the dow and then boeing came out. here are the shares right now. the intraday chart, you can see now down just 15 cents reminds me of ge yesterday which

sold off hard initially and then as the session went on recovered most of the loss i didn't see where it closed yesterday. boeing was down sharply on that large charge which affected the bottom line and the top line, but as stephanie pointed out, it's all about cash flow and those -- that number was actually above expectations. ipo news, intel's self-driving car unit pricing it's public offering at $21 a share. a dollar above its targeted range. it's more than the $15.3 billion that intel paid for the company in 2017. but, as we were reporting earlier this week, i think it was earlier this week, it all runs together, way less, way less than the $50 billion or more than the company had planned when it unveiled the

plans for the listing late last year and the mobileye ceo will join phil lebeau today. the high stakes for investors on election day. we're going to talk possible tax changes with ro khanna he's going to be right here to talk about it. plus, a programming note, to be the at 10:00 eastern time right here on cnbc, you don't want to miss a new "jay leno's garage." jay is joining president biden at the secret service training facility to discuss hot rodding and the future of electric cars. it's tonight at :0eaer100 stn right here on cnbc ♪♪ i don't accept this. i can't do this anymore. impossible odds, save the world. i'm done. what do you have for me? a new way to transform our agency.

strategy to execution. oh, looks my laces have come undone. a business card? yes, for ey. tech expertise? $2.5 billion invested. impressive. okay, you've convinced me, i'm back. just gonna... get this... nurse mariyam sabo knows a moment this pure demands a lotion this pure. gold bond pure moisture lotion 24-hour hydration no parabens, dyes,

or fragrances gold bond champion your skin as a business owner, your bottom line is always top of mind. so start saving by switching to the mobile service designed for small business: comcast business mobile. flexible data plans mean you can get unlimited data or pay by the gig. all on the most reliable 5g network. with no line activation fees or term contracts. saving you up to $500 a year. and it's only available to comcast business internet customers. so boost your bottom line by switching today. comcast business. powering possibilities. ™ millions have made the switch from the big three to the best kept secret in wireless: xfinity mobile. that means millions are saving hundreds a year with the fastest mobile service. and now, introducing, the best price for two lines of unlimited. just $30 per line. there are millions of happy campers out there. and this is the perfect time to join them... see how easy it is to save hundreds a year on your wireless bill over t-mobile, verizon, and at&t. talk to our switch squad at your local xfinity store today.

welcome back to "squawk box. we are now less than two weeks away from the midterm elections and beyond control of congress, there are some big state tax changes that are up for a vote robert frank joins us with what investors need to know this morning. robert >> good morning, andrew. well, we have 12 states, in fact, that have tax changes on the ballot next month. the big three are california, massachusetts and colorado colorado actually has two ballot measures, one would cut the current flat rate and another would reduce the deductions for those making more than $400,000 a year voters in massachusetts deciding on whether to keep its flat tax. that's actually been in place since 1917 or to add a 4% surtax

on those making more than a million dollars, giving them a 9% tax rate. but the biggest by far is california proposition 30 would add a new 1.75% surtax on those making more than $2 million a year. the current top rate is 13.3%. that's the highest state rate in the country. so if this passes, california's top rate would be over 15% with a combined federal and state rate of over 52% the 3 to $5 billion in revenue, it would go to ev expansion. the democratic governor gavin newsom, the state teachers' union and republicans all oppose the measure. a lot riding on this and some

interesting allies both for and against this tax increase in california >> it's always that way, isn't it strange bedfellows just across the board with inflicts. we're going to talk about it right now. we are, we are it's very good -- we've -- remote learning. you don't have to meet anybody the virtual stuff does work. it's better to see you >> it's great to see you for me, you're even better looking in person. that was the first shock to me congressman ro khanna. just moved -- which district -- 17th, which includes parts of the silicon valley how are you? >> i'm doing well. >> the election is less than two weeks away i think there's a lot of issues, but inflation is probably front and center

i don't know whether democrats came to the party late to acknowledge that and focused on other things or not. what's your view on that that's what seems to be on voters' minds when their polled. >> you're right. it is on voters' minds we should have acknowledged inflation earlier and we should make a choice. here's the choice, democrats, we want to bring manufacturing back we want to bring supply chains back we want to put money in the pockets of working class what are the republicans running on they're saying, let's extend the trump tax cuts how did that work out in britain. liz truss almost bankrupted the british economy. they're running on what liz truss just tried to do in britain. >> we've had this discussion a lot recently about whether the tax cuts were beneficial a lot from my point of view, i think that they -- the reason that the deficit is down so much is because of the rip roaring receipt that is the federal

government has taken in as we've recovered from the pandemic. wages were growing, income was growing. i want to get back to talking about something -- we had a discussion earlier today with helima croft who is at thehelima cross. you have said we should -- i guess penalize the saudis for not cooperating with us on trying to keep oil prices down i understand your rationale, but listening to her, i don't think they're trying to do it to hurt us they're doing it for their own domestic concerns. if we were to stop giving them help as a counter to iran, i think it could have unintended consequences do you think of those things, ro >> i do. i don't care what the motives

are. i care about the impact on americans. my job is to help make sure americans are strong and aren't paying a lot at the pump i know what we give them we give them more military technology than almost any other ally we give them 70% of their ards they are making 70% profit on each barrel. big oil companies are saints compared to what the saudis are doing. then they're going to go make more money when we are one of their closest allies >> we can cut that sound bite, that the big oil companies are saints >> republican advertising. >> i'm not trying to trap you. would you at least acknowledge the rush to renewable globally, especially in europe, emboldened

putin to hold that entire continent hostage and that is in large part why we have a lot of this inflation and a lot of the issues that we're dealing with right now can go back to that, can be attacked by the biden administration on fossil fuels >> i don't think that's the case in the united states in germany, yes. >> there was a time when you said we're not going fast enough we're not matching -- >> a lot slower than europe. you can't turn around and say we're going too fast >> germany should -- >> shut down nuclear plants. >> germany should have done nuclear. even chancellor schultz, even with speaker pelosi, he acknowledged germany needs to have nuclear as part of its option you were right about the numbers. 2019 was the highest

this idea that we're not producing is just not true. >> should we not be doing business with saudi arabia at all? then i want to broaden that out to how we handle china do you think of the unintended consequences if we were to cut relations with saudi arabia? i don't know what that would do to the people who need energy around the world become less of a trading partner with china aren't there unintended consequences >> on the saudis, i'm not for cutting relations. all i call for is saying let's have a pause for one year on certain weapons sales. if we put that out there, i think they'll reconsider they're very dependent on china, here's the point we have hollowed out our middle

class. lost 5 million jobs to china we have a 330 billion trade deficit. it's totally unbalanced. i'm for rebalancing the production they're over producing and they don't have any consumer class that has any purchasing power and we've hollowed out a lot of our jobs so let's rebalance the trade and that i think is reasonable. >> you think it's the government's job to rebalance? >> yes first of all, china hasn't played by the rules. >> you didn't like the tariffs, did you? >> i thought some of the strategic tariffs were fine. i thought robert light houser under trump did some things that i agreed with. he said that we can't just have all our industry and production lean here's my view you know the last time we've had a trade surplus in america 1975 we've lost our steel we've lost aluminum. we used to make all of it. >> but you want to raise

corporate taxes? >> i want corporate taxes higher than where president trump cut them to. >> how does that help us bring corporations back here >> because those corporations were building the new factories in the united states the chip sec bipartisan, that's putting intel in ohio. let's unite in this country to bring new manufacturing back which we can do with the productivity, technology and reducing and rebalancing trade deficits. >> how do you balance the trade deficit? what rules would you put in place? because you can't continue to spend like we did on the chip stack for every sector >> i would have strategic government purchasing and government financing in key industries i would have strategic tariffs and i would use what we did with the plaza accords where we rebalance the currency as long as we have as high a currency, the exports are higher. >> the reason we have the high currency is because the federal

reserve is raising interest rates and we're doing that to try to cut inflation how do you put this all together >> it's hard right now with the interest rates going up, it's going to be hard that's a momentary phenomenon. we're not going to have high interest rates for the next year i mean, eventually interest rates will go down the biggest thing, look, fdr in my view had the right policies building industry with the private sector china doesn't doe that. they have state owned companies and state banks. let's have the government help with financing and investment. >> what do you do about the coastal blue states that have very high taxes and you're starting to see it, new york's struggling, california's struggling you're seeing businesses move out. we're talking about higher corporate taxes as one issue then there's the taxes on individuals, the s.a.l.t. tax issue may or may not go away

>> people moving out, california has just surpassed germany as the fourth largest economy in the world. so obviously something we're doing is working when you come to my district, it's gone down maybe a little bit, but we have almost $10 trillion of market cap people are paying tax. so i think we need the s.a.l.t. reforms, but by and large i think it's fine to tax people in my district so we can create jobs in other parts of the country and give people -- >> one thing i haven't heard, we're going to blow through the top and not go to the break, honest to god. i just got the word. that's how important -- the profit margins in the oil and gas industry if you want to do the windfall pale in comparison to all your constituent companies, california. >> how do you square that circle do you want to have windfall

profits? >> i want them to pay tax. i want amazon and other companies to pay. >> oil companies >> because these windfall profits have been caused by the war. if apple and google benefitted from some external event then, yes, they're not benefitting they've had profits because of technology -- >> you know it goes both ways for those poor oil companies they had some lean years, too. do you agree when they almost fell out of business or do go out of business. >> they had depreciation in europe shell and other companies are saying, we understand the pain of europeans. why is it that they're fine paying it in europe and not in the united states of america >> you don't really think it's ever going to -- it's a bad idea, don't you think, ro, seriously? to decide how much -- for the government to decide what is a fair profit for a company? we just don't do that here

>> well, but i think when people are making record profits and folks are paying in my district 6 bucks at the pump, in other places $3.80, $4, $4.50. >> does it make sense for a technology company to have a 90% gross margin they're making a lot of money? they're the same sort of capital structure that a lot of these other companies have should you go after the profit margins? >> i'm for a higher tax on billionaires and millionaires but i'm not for taxing just windfalls perpetually because it's not by some external event. if they were making money on a hurricane or a war, i think that's different. >> at the same time, wedon't give oil companies back when oil goes negative? >> oil companies have -- one of the things i've been pushing to repeal is all the fossil fuel subsidies. they have tax credits forex

tract shuns that a lot of others don't. >> i have two questions. one on wealth tax. i think about evan spiegel from snap. >> snap, i know. >> this was a company that was worth $100 billion just, you know, a couple months ago. now is worth $13 billion depending on how a wealth tax would have been constructed he would have paid -- look, i know nobody is getting out their smallest violin for evan spiegel, but he would have paid enormous taxes ostensibly when it was worth $100 billion. >> let's do the math 2% wealth tax. he would pay 2 billion now it's 13 billion so, okay, he would be worth 9 billion. >> that's market cap his numbers are going to be lower. >> yeah, okay. i'm fine in that case of someone being worth --

>> do you have a credit if they lose their wealth? >> we can have some credit here's the basic thing we should do one of these "squawk box"s from silicon valley. >> let's do it "squawk" in the valley >> moderna and pfizer ripe for windfall profits they benefit from this horrible pandemic. >> look, i've credited them for innovation but what i would have said they benefitted from nih funding but they should be making sure that's being sold at a fair price, not just in the united states. >> we didn't talk about trading. >> we didn't talk about trade. antitrust given all the big tech companies. >> just the one point i make you go and you talk to young people in my district. they're positive, optimistic about america. they think the world's their oyster the challenge is how do we do this in other parts of the nation and how do we get other people to have that shot. >> it's getting easier oracle is looking for employees

that don't live in your district, that live in places in other districts. they don't want them living here, they want to pay less money. >> there's talent in a lot of districts. >> i see a lot of young people tweeting >> they need to listen to you, joe. >> they need to listen to both of us. >> congressman, thank you. definitely got to have a commercial now we've cut our own taxes. raised our own taxes thank you. >> thank you by the way, folks, it is just after 8 a.m. on the east coast and you are watching "squawk box" here on cnbc. we're live from the nasdaq market site. i'm becky quick with joe kernen and andrew ross sorkin u.s. equities, dow's down by 30 points s&p off by 27. the nasdaq is feeling the pressure this morning down by almost 200 points after weaker than anticipated results and outlook from technology companies. we'll talk about that in a

moment that is what's been pressuring the nasdaq treasury yields have been tamer. you're watching the 10-year yield. down to 4.063% get you caught up on a few of the stories that investors are going to be talking about. out with new quarterly results the plane maker posting a huge bottom line miss in addition to revenue. the earnings per share miss were because of a 2.4% charge boeing is taking related to five defense programs those include the new air force one and the kc 46 refueling tanker on the plus side, boeing's free cash flow and operating cash flow came in better than expected that's what's moving the stock it's up by .4 of a percent don't miss an exclusive interview with dave calhoun in the next hour on "squawk on the street." ipo news, mobileye is at $2

a share. the company's ceo will join "tech check" coming up at 11:30 a.m. eastern. bed, bath & beyond company naming sue gove as its ceo they praised gove's intense focus on cash. the stock down by 4.3%. i want to get over to frank holland. he has this morning's biggest earnings movers. frank, what's going on >> it's all about the earnings movers this morning. we have a fun one, shares of harley-davidson higher up more than 3% after the motorcycle maker posted a beat on the top line and eps profit. 38 cents above estimates north american sales up 18 cents. guidance reaffirmed. turning our attention over to consumer staples

kraft heinz moving higher. double digit organic growth in north america and overseas markets. halliburton moving higher this morning. the stock is up almost 2.5%. got an upgrade from wells fargo. analysts expecting sequential year over year earnings and cash improvements wti up about 10 bucks a barrel over the last month. silvergate capital, down almost 2% this is after a downgrade where analysts have a question about downgrade growth price target cut from $108 to 468. shares still up. shares down 2% right now joe, back over to you? >> frank, thanks. coming up, youtube ad sales also disappointing wall street raising broader concerns about the economy. we're going to talk to industry analyst michael nathanson when

"squawk box" comes right back.

if you wake up thinking about the market and want to make the right moves fast... get decision tech. for insights on when to buy and sell. and proactive alerts on market events. that's decision tech. only from fidelity.

welcome back, everybody. shares of google parent alphabet falling after the company posted its biggest bottom line miss in a decade youtube ad sales down 2% year over year. that's the first decrease since google started breaking up the results in 2019. joining us to talk about the decline is michael nathanson

what do you think? what's your take away? >> my take away is that clearly the economy is slowing advertising is a very good leading indicator about the health of the overall economy and in every place but search there's not a mandatory reason to spend you see this all earnings season, real weakness. that's going to happen in the fourth quarter of next year as well >> so as a result, it's clearly a surprise for the street. the stock is off 6.8% this morning. would you be a buyer here or is this a time to step back and wait to see how much damage is inflicted? >> we're buyers of this. we believe that search was the best advertising platform there is changes in apple, idfa, search goes up and down i think the reason why the stock is down is on a cost side.

if there was a headline saying advertising is weak, that's not surprising most people it is the cost growth that was higher than people thought just the speed of the reaction taking a head count down that's the focus i don't think. again, we understand what's happening to the global economy. you can do so much during the pandemic we all want to see what's the outlook on margin in the next couple of years. can they slow it down low enough to stop the margin. >> the first quarter of next month, is that enough? >> that's the question, right? it feels to us that all of these companies over expanded during the downturn started the year off with hiring plans and then all of a sudden

like most super cool names, they hit a wall i think what people are wondering, i see this, numbers are all over the place on margins. i don't think there's consensus on how quickly they can take it down we all have the same view on revenues clearly, but to us, you know, we run it on a long-term basis. i understand our first rule is you don't buy stocks until you have a handle on negative revisions. as soon as you understand clearly their cost control, i think people are going to struggle to get excited about this you're kind of explaining the cost going forward, right? you hear all the questions on the calls or about the cost growth and cost containment. >> what about meta that stock is down this morning, too, just because of concerns. do you think search is the only place that's sticky, what does that mean for meta platforms >> yeah.

so we've been taking numbers down from meta all year long buy meta as well you've seen snap miss. you've seen alphabet miss. i think people are assuming that if you look at the range of misses, that there's the likelihood that there's going to be a miss at meta tonight because their business has been affected by idfa and apple changes. they're not as strong on search. >> michael, in terms of advertising, we've seen all the big streamers. many of them have had ad advertising at least the initial price point for consumers with the idea that they're going to make it up on the other side if not make it up more on the other side using the environment we seem to be walking into, do you think that's a strategy that's going

to work at least in the short term >> andrew, in short term the size check that they're going to get is small enough. that won't matter. they won't have enough subscribers. longer term, they need to attack linear tv. they need to attack cable network pricing. this is much cheaper than broadcasting that is a work in progress on disney+, they're starting out with a small ask they already sell branded video because of abc and hulu. you're going to have to also bring down what their assumptions are in pricing, right? there's a weakening of demand. you can't increase pricing in a weakening demand people have to adjust in '23 what their asks are. you have to ask yourself, the real problem is on linear cable

networks because that's the risk, ratings are down, people will chip away at the ad dollars. if search is weak, what's going to happen to linear cable networks, right? not a great position right now >> except for "squawk," of course. >> except for cnbc. >> you know, say it loud and say it proud thank you so much. appreciate it. check out shares of seagate technology they are taking a hit after missing estimates on top and bottom lines the disk drive maker has a consensus estimate of 22%. now separately we should say sea gate had been warned by the government they had violated export control laws by selling disk drives to unauthorized buyers buyer, china's huawei technology so it's going to be a case perhaps to keep our eye on there. joe? >> haircut this morning.

coming up, a former t.d. ameritrade chairman, joe moglia.

♪♪ age before beauty? why not both? visibly diminish wrinkled skin in just two days. new crepe corrector lotion only from gold bond. champion your skin. our internet isn't ideal. my dad made the brillant move to get us t-mobile home internet. -which... we have to share our signal with the entire neighborhood. yeah, now we do some weird things to get our speeds.

well... i'm up. -c'mon kids. this sucks. well if you just switch maybe you don't have to be vampires. whoa... -okay, yikes. oh sorry, i wasn't thinking. we, uh, don't really use the v word. that's kind of insensitive. we prefer pro-lunar. yes, much better. welcome back to "squawk

box. new this morning, a group of attorney generals are calling on grocery chain albertsons to review a merger. it will prevent albertsons from competing while the merger is pending. joining us is washington dc attorney general carl branson. how are you? >> how are you doing, andrew >> i'm good, andrew. thank you. let's talk about this and why you wrote this letter. how concerned are you about the deal >> we're deeply concerned. republican attorneys general and democratic attorneys general we're specifically concerned about the deal because with the announced merger was a significant, nearly $4 billion

special dividend announcement which could be valid or could amount to a massive improper give away to certain shareholders we think that we need to review that, and that's exactly what we're doing. >> just to put a fine point on it you think the dividend is a special give away, that's where you're looking at? or you're looking at the transition >> that's a great question i think we're going to take a look at stages first stage right now is to stop the dividend payment we're asking nicely via letter all options are on the table, but that needs to be stopped we will, of course, review the entirety of the merger, but the actions around a special dividend is what caught a bipartisan group of state attorney generals. >> but you're worried about the dividend because if the transaction gets blocked you believe it puts albertsons in a particularly compromising condition, is that the sort of

way to think about it? >> you've got it exactly right, andrew $4 billion out of the account from albert son is going to make it quite difficult for albert son to compete in a tough marketplace. that may weaken albert son and may lead it to a foregone conclusion, not one that will result from a proper review of a merger we're going to stop that payment. >> right. >> we're asking them to stop it first. >> can i ask you this though, advocates of this transaction would say given how tough this marketplace is, you just described it >> all of the new ways that people are doing it and they need to work together.

we're thinking about the market in a different way. that level of concentration, mom and pop, gone. mid-size businesses, gone. what does that mean? prices, increase concentration of power, increases. difficulties on workers, increases. so we're focused on competition, workers and consumers. >> attorney general racine, you said that you're going to ask them to do this voluntarily, but then you have other options if they don't what are those other options >> becky, i would just as soon leave the options on the table

because i really would hope albertsons does the right thing and just allows the status quo to proceed while the review of the merger takes place what's the rush? >> just from a legal perspective, could you sue to block payment of the special dividends? that's something you could seek from a judge in advance of a transaction like that? are there examples of situations historically where attorney generals or parts of government have done such a sning. >> i don't want to speak specifically about the particular matter. i can tell you that state attorneys general routinely go into court and seek injunctive relief seeking such in this case would result in the stopping of the dividend payment so, yes, that option is on the table >> just to go back 30,000 feet again to the broader issue of competition and we talk about trying to protect mom and pop stores, we talk about protecting the traditional retailers that have become the sort of

supermarkets that we all know and spend time at and then the addition of what we've seen in ecommerce space, do you look at this space today and say there's more competition or do you say there's less competition >> it's a quite interesting question, andrew i think you can go both ways i'm focusing on the competition and its impact on consumers and workers. what we know is that when you've got two or three or four or five titans in an essential industry, they use their market power to squeeze suppliers, that reduces their costs, of course they make profits and benefits the others who would be their competition, the smaller businesses, mom and pop in the middle, they cannot exert the same pressure on the suppliers >> right >> that's the negative impact on competition and i tell you, the same kind of impact occurs to workers. >> you mentioned a bunch of times now not just consumers but

anything about employees how do you balance those two in the context of how you think about competition and historically what we've seen at least from various states and attorneys general and judges ultimately is focused on price, focused on the consumer over the employee. >> yeah, you know, i've seen that as well i think the law needs to be further developed. i hope that this matter will further develop the conversation the impact on workers is fierce. think about the grocery food industry, for example. we know from different sources that the price of food increased anywhere from 11% to 12 1/2% we know that there's other inflation. workers are having a hard time and what they need to do is be protected against, again, over concentration in a central industries >> but the other complicated part about that is one of the reasons we've had the inflation

we've had is wages have gone up materially you're starting to see a situation where the cost of employment is hitting -- is actually hitting the consumer in the pocket as well and i know it's -- this is a circular and could become a vicious cycle depending on how you make the argument, but that's the conundrum we're living in. >> i think we live in could he none drums and smart people of goodwill and in this instance democrats and republican are trying to figure it out. >> okay. attorney general racine, we appreciate you joining us with this news. >> thanks, andrew. when we come back we'll talk about what investors should expect from meta earnings later today now that we've seen a pull back in ad revenue for youtube, here's what the market is expecting. that stock is down by 4.4% first as we head to a break, a reminder to catch president biden on an all new episode of jay leno's garage at 10 m.p.

eastern right here on cnbc we'll be right back. ♪ ♪ ♪ ♪ ♪ ♪ introducing ihg one rewards. seventeen hotel brands. six thousand global destinations. one loyalty program that lets you guest how you guest.

welcome back to "squawk box. the nasdaq is down over 200 points and the dow negative. moving around a little bit boeing, out. different earnings, microsoft,

alphabet a market flash ongoing, alaska airlines says it's buying 52 737 max jets that marks the largest commitment for future aircraft in the airline's history the orders are marked for delivery between 2024 and 2027 boeing's ceo dave calhoun will join "squawk on the street" coming up in the next hour. coming up after the break, an in-depth market conversation you don't want to miss we have joe moglia with us he's got a lot of insight about what is going on in these markets. we're going to have him in just a moment "squawk box" coming right back

welcome back to "squawk box" on cnbc. the futures right now are negative that's red 215 on the nasdaq. dow down it had been positive and the s&p down just over 30 points boeing out with over third quarter results last hour. shares all over the place. a little bit less than a percent. we're continuing to watch the shares of two tech giants.

alphabet and microsoft the guidance there and both stocks as you can see are significantly lower this morning that's hurting the nasdaq and spreading a little bit. >> let's dig a little deeper into the earnings season what's happening with the markets and economy. we are joined by joe moglia. he is the former chair and ceo of t.d. ameritrade joe says we are probably already there a recession. joe, what do you see to kind of tell you that? >> i think i'm seeing -- we've all seen a whole lot as far as this goes. if you have gone back several months, just the simple fact that inflation, we don't think about it we talk about inflation all the time it doesn't impact our lives that much and the people on the show that much but it impacts the average family in our country. out of 70% of our countries would fall into a middle america type of designation and at the

end of the month, they have trouble -- that typical family, and a lot of those are people i know, friends, they don't have enough discretionary income to pass that around that tells me they're already in a recession regardless when we have the economic data associated with that. >> because real wages have dropped. >> yeah. yeah yeah >> watching the earnings season, look, right now we're worried about what we're hearing from some of the tech giants in particular and that's affecting the nasdaq today if you have slower growth, that is obviously going to hurt on those companies primarily. >> a couple of things. first of all, tech companies, google, microsoft, everybody is well aware if you get -- you don't come in on the top line and if you don't come in where you're supposed to come in on the bottom line, you're going to get punished for that. the biggest punishment is the insight you give people going forward. if you can't say we've turned

the corner, you're telling that investor that trend is going to be negative to you i think that's going to punish you. as far as overall earnings go, i think for the most part earnings were coming in reasonably well 20%, i had been off on that number almost every one of those had been in on the forecast. >> that's on a much lower forecast the bigger companies are getting smacked down by the marketplace. >> already in a recession but we're going to have a good number on thursday what i think that indicates, the two negative quarters probably didn't indicate we were in a recession. this positive number we get on thursday isn't going to not indicate we're in a recession.

you know what i mean >> yeah. yeah it's not always easy to understand what you mean you deal at such a high level. >> true. >> you use so many poly syllabic words. >> you know what i mean? >> yes, i do when you talk about the economic data, joe, what i was talking about, i don't think anybody at this table thinks we're in a recession. the typical family is. i know for a fact these are families of my players, they're struggling at the end of the month, end of the year they're not taking a vacation. >> you know what else, joe, is in a recession, maybe a depression, is retail investing, i think. the business that you revolutionized. >> yeah. i think the actual activity in retail has significantly, significantly dropped off. it's clear the average individual investor is absolutely on the bearish side some data with regard to that, you had tom petterfly and ibkr

i don't see anybody opening accounts schwab, their average tried is 5.5 million. that sounds like a big number. when we closed the schwab/t.d. ameritrade, it was 8.4 i heard robin hood the other day said the most recent month is the worst month they've ever had. that's activity. >> how does it compare to pre-pandemic i feel like there were so many people who got in because they had extra cash, extra time on their hands. they weren't going out they had a lot of time on their hands. they were doing a lot of day trading. that was unusual activity. >> i agree i think it's the exact opposite of that now. when they started getting money in, it was more money than they had before they used it going out the markets after that, big

moves from february to march, the market is doing well after that day traders, when the markets are going like this, day traders are doing well when it's going like this, day traders don't do well. while people are bearish, i have seen a significant impact in terms of their behavior. for example, i've seen a move away, not totally but a reasonable move away from the etfs and the indices to individual stocks. microsoft, apple when tesla got hit, we saw some pretty good buying there >> go back to this sort of etf/mutual fund, sort of a way for individual equities? >> no, what's happening is the opposite going away from the etfs, some of the individual names. but there's only a handful of names i've seen. i've seen some financials, jpmorgan, citi. >> where do you see crypto in the retail space >> right now >> and what you think is done or not in the retail space.

>> one of the reasons you've seen robin hood come down. >> i think it's giving them an upset stomach, little bit of a black eye. all crypto has done is gone down so if an individual investor has their money in crypto, you've got hurt typically what an individual does is gets hurt too much they simply withdraw the crypto involvement that existed precovid, that does not exist today. >> that was one of the things mentioned, i think it was on the alphabet call where they were talking about areas where you're seeing a pull back not seeing it on crypto, mortgages, on loans, with other areas like that. that had been fueling a lot of the spending we had in the ad arena, too >> totally 100% would agree with that i think one of the other things, too, that we've seen is that there is -- we all knew we were going to see some sort of activity but with the 10-year

note solidly above 4%, we're not seeing some people anynibble the we're seeing people take big positions. there's not been an opportunity to have genuine asset allocation now they can start doing that. and the typical investor if they think they're through the dollar cost average into the bond world i think would be very, very, very smart now don't go out too far ladder it. don't go out past 10 years and as long as the fed is tightening, your principle's still going to get hit if you do it up until the fed stops tightening, they acknowledge we're done for a while, i can see a rally in the bond market. that's when you want to get into even 30-year bonds we're seeing more activity in fixed income than we have in a decade. >> we talk all the time about how the fed is the biggest driver of the markets and it is.

>> yes. >> what you're just talking about, too but i think we have issues with ceos looking at the fed too closely and blaming the fed with what's happening in their own businesses. >> i want to be fair to the ceos of america when the ceos come on your set and they start talking about the fed, i hear many of them give their opinion about what the fed is doing they're right, they're wrong i can appreciate an economist doing it, but that's not our job. ceo, that's not our job. we're supposed to understand what they're doing the fed has clearly said we're going to continue to tighten until we are sure we have things at those levels. you have to make sure you know what's going to happen we know the fed will continue to tighten. we know there's a positive impact on the dollar

we know with that eventually the housing market is probably going to crash somewhere in here what's your job as a ceo there are three jobs every ceo has. employees give value to each of those other constituents so you've got to let everybody know ahead of time. you have to do a better job of communicating with your people depends what company you're running. if you are running a company in the discretionary sector you may have to cut back on different things if you are running financial services though, you've got to stay in front of your client you can't necessarily get rid of a lot of people to be able to do that number one, you have to have a very, very clear plan for what's going to happen over the next 6 to 12 months whatever that might be, if you see you are wrong, you can't let your ego get in the way. you have to adapt and adjust your primary responsibility is your clients, employees.

>> a little bit of tough love from coach moglia. >> i do tough love those guys. >> sometimes i think the academic's on the fed and employed by the fed, i'd rather listen to ceos. >> the ceos could give you -- >> i don't know what term you would use for the guys in charge, doing it, fed watchers, experts, academics, they can keep all the experts you guys are on the front lines. you would know if the fed is screwing up, i would think >> yeah, but you can't control -- i don't care who it is, jamie dimon can't control what the fed is going to do. >> i wish he could. >> i'm not disagreeing with that, but he can't if he wants to run jpmorgan, which he's not, based on what the fed should do as opposed to what's happening -- >> i can't change it my job is to respond to it. >> so the leaders that run businesses, their responsibility, again, is to make decisions based on what they see will happen in front of them their bonuses and earnings and

market shares are on the line for that. >> i can see how they would get frustrated with the fed putting them in the position that they're in right now. >> yeah. you're a bauby my guy dropped the ball but the reality is. >> we stayed at zero forever we're going to put everybody else in recession. we thought it was transitory now we'll sink the economy so we can cover our own -- >> you're speaking as a fed person i'm speaking as a ceo. regardless of what the -- >> you know what i mean. >> i know exactly what you mean. always prophetic. >> jamie dimon and others have kind of copped to that very attitude and steered clear of -- jamie dimon did not say anything really harsh against the fed who is his regulator probably don't want to criticize too harshly. it is interesting to hear from those hard hit.

>> academia, one of the professors you have on is not going to lose his or her tenure and i love academia. >> oh, boy oo. >> joe moglia is here. he'll stay with us and we'll have more to come. >> and on that, jim cramer's first take on the remainder of the morning. follow squawk pod on your favorite podcast app that would be tough for me i don't have a favorite. gosh, i like all of them so much you there? huh? >> favorite pod app. >> i don't have a favorite pod app. we'll be right back.

♪♪ the only thing i regret about my life was hiring local talent. if i knew about upwork. i would have hired actually talented people from all over the world. instead of talentless people from all over my house. - [narrator] if your business kept on employees through the pandemic, from all over the world. getrefunds.com can qualify you for a payroll tax refund of up to $26,000 per employee, even if you got ppp. and all it takes is eight minutes to find out.

then we'll work with you to fill out your forms and submit the application. that easy. getrefunds.com has helped businesses like yours claim over $1 billion in payroll tax refunds. but it's only available for a limited time. go to getrefunds.com powered by innovation refunds.

more importantly, payment vine growing 10% in the most recent quarter processing transactions. revenue rose by more than a billion dollars to $7.8 billion. the cfo fascinatingly said visa hasn't seen consumer anxiety or uncertainty at all spending is stable and strong almost everywhere in the world ceo al kelly said they may be buying more generics than brand

names but they're spending the same amount of money the company is watching for any payment volumes. there's a lot of pent-up demand for travel and employment remains strong we've been having a debate about whether 're awein recession or not. we will talk about all of that when we come back with jim cramer after this break. so you know all you need for recovery. and you are? i'm an investor...in invesco qqq, a fund that gives me access to... nasdaq 100 innovations like... wearable training optimization tech. uh, how long are you... i'm done. i'm okay. 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. power e*trade's easy-to-use tools

make complex trading less complicated. custom scans help you find new trading opportunities. while an earnings tool helps you plan your trades and stay on top of the market. when you work in it complaints are part of the job. bill says the coffee is weak today. but since cdw helped us switch to mac, everyone's happier. dan from finance likes getting performance without a big price tag. bibi digs the power of the apple m1 chip. mac is easy to manage, compatible with all our apps and came preconfigured by cdw. now we're even getting compliments. that was bill again, says he loves his new mac. he's right about the coffee. michael is back. and he's more dangerous. maybe the only way he can die... is if i die too. [ screaming ]

welcome back to squawk box. we get down to the new york stock exchange. jim cramer joins us. jim, it's like a tale of two city, economies. yes or no what to say. you look at google or alphabet on one end and micro soflt on one side and visa slowing boeing in the middle. it's confusing as to what's happening. >> that's a great analysis. what i think people are doing, we, again, have underestimated the change in the psyche of america, in particular, because of covid. i think there's tremendous desire to go places, that's visa. tremendous desire to buy things but only things when you've been traveling, that's visa. you do have a shortage of planes developing. that's boeing. and then there's a very

unrealistic nature of silicon valley they talk about being leaning. some from an ak wi sags. talk about the need to continue to grow at microsoft and then how they are hurt by the collapse in anything personal computing. te texas instruments confirms. i'm going to put it bluntly. the cloud is no longer in the early innings. that's not longer the case and companies that live and die by the cloud must recognize the cloud itself is now cyclical. >> if that's the case, and i want to get joe in this real quick. how do you think about microsoft as your cloud and then at the multiple they are sitting at now relative to a sales force the cloud company, the sass, sort of model for everybody? >> i think in the skas of salesforce, while i think it's

doing well they have to address the notion of what starboard is saying. their costs are too high. i think all the companies. i've been saying this is no longer a lich group because they seem to have lost or do not know how to fire. they have to fire. not fill positions and not slow hiring. but fire. the glut in this part of the country is in these companies. they have too many engineers. they have too many sales people. they have too much belief there's going to be eternal growth. that's over and that's what this quarter is demonstrating. >> hi jim. congratulations on the eagles. secondly with regards to what's going on now and the conversation a while ago and what you're referring to now. everything we've seen for the last few months, the vast majority of ceos are expecting a recession if we're not in it already.

you talk to these guys every day. and have great relationships with them. are they running their businesses recognizing that we do have a recession or there's going to be a recession and, therefore, we've got to run -- we're responsible for taking out companies in a particular direction? >> joe, you and i have been through worse. you've fired people. i've fired hundreds of people in my time. i am not proud of that. but i recognize the enterprise, the institution must be preserved. for you joe, people in sill son valley. the only people that it's going to be bad for is mark zuckerberg. they have to look at each division as you and i have and say there's too much fat. they don't know how to fire. they do not know how to fire. they know how to be able to become, how to get energy costs

down. but that's not people. you know what it's like. you know how horrible it is to bring someone in and say, we must preserve the institution and you must go. these firms have great balance sheets but they do not realize they are so incredibly fat versus what's occurring that it's almost laughable when you listen to their conference calls. >> same page on that jim. thank you. jim cramer we will watch you later this afternoon. that sounds awful. have you had to fire people? >> no. >> you wait a minute. i fired our pooper scooper. that's the only guy thing. >> you have your own pooper scooper? >> for three dogs. two german shepards. tha set to report quarterly quotes

after they close. duty calls. watching the metrics from the facebook owners -- that may not be the people i fired. ajoining us roy carney and joe moglia is going to stay with us. i remember netflix got under two hundred and i said if i could buy it i would buy it. is meta cheap yet? >> thank you for having me. it's cheap but we don't know how cheap it can get. it's 23 low enough this is a key question. i think efficiently if they can show efficiency tonight that 23 operating expenses and capital expenses are going to be down year on year or flat. flat is the new down, in my

opinion. that will be shared by wall street. as you can see snap missed, google missed. if facebook misses not a big deal. but if they tell we are going to cut investing then it's not cheap enough right now what are the key similarities and key differences from the big mega cap tech reports so far from meta? are there things to help or hurt it more, advertising et cetera >> the slow down that google saw that google is reporting, i think that is applicable uniformly to a company like meta. as in search, to some extent, along with facebook feed. a lot of overlapping characteristics as far as demand, as far as customer, as far as behaviors is concerned. probably google gains a market share when we are in a downturn.

that's an inkcremental negative for meta. if google is seeing slow down i don't why meta should see something exactly the opposite. they may see less of a slow down. there is the question about how much is priced in the weak stock we are at. google is 30% peak demand is high. facebook is probably 20-30 prgs below pre-pandemic high. there is a difference in what is priced in and what reaction could look like. but having said that if the question is about demand and revenues i think meta follows the weakness of google. >> if you had a chance -- >> we got no time. >> if you had a chance to hear early in the conversation with cramer saying the vast majority of ceos act like we are not in a recession and they are okay. what are you seeing from ceo

>> they are not going to be able to act quickly. i feel the ceos need to act quicker from that stand point. >> great answer. thank you. thank you to joe, as well. we have seven seconds. yes or i don't know what with we can do. we can't get in to football. join us tomorrow. squawk on the street is next. . good wednesday morning. we're at the new york stock exchange. alphabet and microsoft and tech in. strong results out of industrial and lee sures along with with lower yields and weaker dollar. our road map begins with the nearly $2 billion revenue missed by boeing with air force one and tanker