ftx customers. >> there was no person who was chiefly in charge of positional risk of customers on ftx that feels embarrassing. >> much more on that interview straight ahead it's thursday, december 1st, 2022 is that right? >> yes >> "squawk box" begins right now. good morning welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm rebecca quick along with joe kernen and andrew ross sorkin, who is back after dealbook congratulations, andrew. >> thank you >> that was amazing. i could not take my eyes off the

sam bankman-fried interview yesterday. >> crazy day. >> it went long. >> when did you go home? >> i think i didn't get home until 8:30 or 9:00 we started early long day >> cocktail up at all afterwards >> no cocktails. >> not even a glass of wine? >> i was living off diet coke all day. >> to bring yourself back down >> i didn't sleep well w at 8:00, you will know >> can you figure outdoeshe still like the attention, do you think? does he need -- is it cathartic? >> it feels like he is trying to say i didn't know. >> does anyone start out hoping something like that happens?

i remember the worst of the worst. bernie madoff said i just wanted to be doing well for people. it just gets out of hand does it just get out of hand no one starts this >> i think we will talk more about this later i think it probably got -- both got out of hand and because it was and still is the remarkably unregulated world and so abstract -- by the way not just abstract to us, but themselves the idea of moving money from one thing to another this isn't in defense of it, by the way. when you try to rationalize how he got to this place >> he is sorry he got caught and he lost all his money. i can't believe the bill ackman

take and bill o'leary take i sat through and said this guy is a lying liar. >> what is the test? >> rorschah test >> bill was there in person. call me crazy. >> i saw somebody else saying i sat next to him. i think the best response i saw to the tweet was from the dog who said, okay, cool unrelatedly, if you send me $1 million, i will send you $2 million. >> it was interesting. i was leaving and there were people who believed him. not just believed him -- i think there are two sides. some people were sympathetic is the wrong word as we said at the beginning of the interview. the sympathetic view is this is

somebody who made a terrible and bad decision which is what i think he believes he made. >> he thinks he is criminally negligent versus complete fraudster? >> or something much worse >> this is a story we will talk about and we will. we need to look at what is happening with the markets look at the u.s. equities at this hour. things are muted dow off 62 nasdaq off 40. s&p down 8 that is because stocks were up huge after jay powell's speech dow up 737 points. that is a gain of 2.2% s&p up 3.1%. nasdaq, incredible, up 4.4%. all of those growth stocks that were pressured and hammered by the fed. today's on moving and now dow is back in bull market and defined 20% insurcrease from the recent

low. and s&p up 14% and nasdaq up 11%. nasdaq in positive territory for the month. we had talked about how it had been down the day before nasdaq in positive territory for the month. nasdaq up 5.3% treasuries came down within minutes of the chairman speaking you see the 10-year treasury at 3.056% > let's get to the kmcomments fro jay powell with steve liesman here >> is the inversion, i tried do the math. >> still 70 basis points. >> hang on 2/10 2/10 -- 72.08. >> that didn't cure that yet >> what i think is the question

of the day did fed chair jay powell intend to give a speech to lead to the decline in bond yields and surge in stock prices? there were a few dovish comments my view remained hawkish as it ever was he said the fed has a long way to go to restore price stability. rates will go higher than forecast in september. he said the fed will stay the course until the job is done we will hear all the market heard. >> monetary policy effects economy and inflation on certain lags and full effects of the rapid tightening are yet to be felt it makes sense to moderate and sufficient to bring inflation down the time for moderating the pace of rate increases may come as soon as the december meeting. >> joe said he said that a couple of times. let's look at the peak funds rate it fell to 4.91 down from 5.05

the market priced in the potential end of the price hikes in spring of next year debating if 50 in december is followed by a 25 or 50 in february and if the fed is done after that or has one more 25 basis point hike left in march either 75 or 100 left to go. i think it is a fair bet that a rally that eased financial afte the speech was not powell's intention. >> yesterday, remember, i said did he xerox what he said last time >> he didn't >> i saw the markets and said he really must have said something. he xeroxed what he said last time s time. >> from the august >> we go higher. >> we slowdown >> we go higher.

>> i want to quote myself, joe yesterday on the show, i said we will have a challenge. saying slower, but not lower i think the market misses the lower. sl slower, but not lower. >> i had the feeling and asked sam -- our senior market commenter. with him, sees a senior. i guess that's a good thing. >> until it's not. >> then you are a junior >> i said this market is so hungry for something good. it's spring loaded like any data point in inflation if it is cool, it is ready to take it. or if it is the opposite, are we back where we get a really hot inflation number will we give back 10%? >> certainly joe, one thing i keep hearing

from investors and guys running a lot of money -- >> not sbf >> no. i have have comments on that, to it is the volatility you just don't know where all this ends. ask yourself the question. if i can suddenly see the end of the process, what is my bogey i can hit? if i figure that out, i have less resources and deal with less money. >> when you see rises like this in the past, powell has pushed back and jaw boned it tougher because he doesn't want this inflationary impact from higher asset prices you think he will do something given the move yesterday or take additional moves. >> send someone out. >> come down and start to hatchet. >> i think there is a concern

with the stock market. if you put up the 2/10 year. this is what he doesn't want to happen amid continued concern about inflation and being not sure that inflation is coming down >> the question i have is it just overconfident anytime there is anything that has looked positive has been the sort of run. then the question is is the run right? >> i can't know. i'm reluctant to say the market is wrong about something because you just don't know what the market knows if the market thinks the fed is not going -- >> this summer, you knew there was a period you knew that the market was wrong the market was wrong >> i was right to think the market was wrong if the market still is incorporating the fed doing 100

or 75, it can do what it wants the fed doesn't have to lean on stocks here is the problem. what is happening with the 2-year term and the loosening. >> the fed can look at the 2-year term and say the market is wrong we're under the impression the ten year and saying the fed is i don't think is wrong is that telling the fed -- >> which one is the lighthouse >> the 10-year is a lot of money deciding what to do. >> is the 10 hiv year lower because the market thinks inflation is lower or recession? what is the actual signal from the beacon i'm always confused by that. everybody thinks a recession is building. >> does it matter? if it is, it is indicating a

slowdown again then the fed has done its work already. >> i think our existential -- >> it should be the final word it should be the final word. >> i don't know if that inn corporates the idea the fed will get to this point or call it and stay for a while >> or recession comes and forces the fed. jay powell did not want to cut rates. that's why he is doing this. steve, thank you. >> jay powell and sbf. >> i feel ununsatisfied. >> i would like to continue the conve conversation >> decide which guy you want to hang on every word jay powell or sbf? >> we will bring you more highlights from the wide ranging interview with sam bankman-fried that took place yesterday at the dealbook conference. big take aways from meta's mark zuckerberg and netflix reid hastings you are watching "squawk" on

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and alameda comingling of funds. >> i didn't co mingle the funds. you have customers borrows from each other alameda was one of those i was surprised how big alameda's position was which points to another failure of oversight on my part and failure to appoint someone to be chiefly in charge of that. i wasn't trying to comingle funds. >> we got into a bigger question i asked what his lawyers are telling him right now. >> they are very much not. you know, the classic advice don't say anything you know, recede into a hole that's not who i am. that's not who i want to be. i have the duty to talk to people and explain what happened i have a duty to do everything i

can to try to do what's right. if there is anything i can do to try to help customers out here and i don't see what good is accomplished by me just sitting in a room pretending the outside world doesn't exist. >> you are in the bahamas right now. you are in the bahamas because you think you can't leave? >> i'm in the bahamas. i have been in the bahamas for the last year. you know, i have been running ftx from the bahamas been running ftx digital market, our primary operating entity down here with the bahamian regulators and others in contact. you know, right now, i'm looking to be helpful where i can with the global entities that would want my help >> do you think you could come to the united states or go elsewhere? >> to my knowledge, i could.

>> have you thought about doing that >> i've thought about it you know, i've seen a lot of the hearings that have been happening. you know, i would not be surprised if, you know, some time i am, you know, up there talking about what happened to our representatives or wherever else is most appropriate. >> also, i asked him what he thought about his own future >> that's not what i'm focusing on there's going to be a time and place for me to think about myself and my own future i don't think this is it right now, i've had a bad p month. this is not any fun for me that's not what matters here what matters here is the

millions of customers. what matters here is all of the stake holders in ftx who got hurt >> then we got to the issue of drugs which he and others have tweeted about over the years pictures of m. sam. >> i maybe have half a glass of alcohol a year roughly speaking. there were no wild parties here. when we have parties, we play board games. and 20 people have three quarters of a beer the rest of tus would not i don't see illegal drug use at these parties. when i say parties, i say having people over for dinner is what that meant. >> sam will hold a hearing today on the collapse of ftx i imagine some of the interview may be part of that. >> i think so. like i said, i could not turn

away i watched everything again, there are two ways to come at this you are an idiot or a criminal for what happened with the $8 billion missing. he went with i'm an idiot defense. i guess i would, too, if that would get me less jail time. >> what was the supposed drug use? was it supposedly -- we go from half an ounce a year -- >> i think if you read some of the tweets, it's about uppers and downers and stimulants >> those are not illegal was that a parsed answer >> i don't know. look, the whole thing at this point didn't look like a company, but adderall induced sleep over >> no one sleeps sdp. >> there have been pictures taken at his desk taking m-sam

a patch for parkinson's, but increases the dopamine in your brain. >> m-sam is sam short for what for whatever the long name of the drug >> i imagine >> not sam bankman-fried >> no, no, no. >> sam, i am >> in the longer response, he said some people may have prescriptions from doctors or different things he extended beyond that. >> that's where it is troublesome. if you are going to parse, you know, you will be able to deny something based on illegal or legal. you are abusing legal drugs. >> the complicated this is no governance i'll say it over and over. no cfo no board the venture capitalists were not minding the store because the of

the business model was not to mind the store that takes away from what ultimately happened here he owned both entities the hard part that people struggled with yesterday as we had the conversation is he took very little responsibility for what he said was happening at alameda. although he owns a majority of the company. >> said he did not know they were comingle. sd >> he said he didn't inte intentionally comingle >> doesn't someone sign or press the button >> if no one is controlling that, he is the person in charge he didn't put anybody in charge of that. >> will the $2 million guy get his money back >> i don't know. i believe that gentleman -- i wrote -- i read a letter that --

>> it was you? you wrote the letter the article sdp. >> i got a letter and somebody said he lost his life savings. it was ftx global. that is in a more complicated s spot >> people here have a better chance >> interestingly he believes if you are on ftx u.s., it is a solvent institution and you will get a lot of your money back he speculated you could get 100% of your money back. >> i would like to hear from the guy in charge of that now. a lot of what sam bankman-fried said is not based in reality >> based on value. >> you know how many claims there are in that? >> interesting what was ftx derivatives and rebranded it ledger x. >> blockfi bankruptcy court that

squared and quadrupled you are talking years of everything tied up in claims nobody is getting anything back for a long time. >> you have to share it with the lawyers. >> right >> nobody is playing at ftx arena anymore. that's going to go quickly. coming up, into the trash bin of history with enron. enron stadium. >> it was fascinating. i could not turn away. the conversation lasted more than an hour it was must-see tv i can't wait to see the numbers on this. i could not turn away. >> we will see thank you. >> salesforce shares falling after the company announced the departure of bret taylor. and pro week at cnbc today today, a new way to trade at 3:00 for the experience called "the tick.

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salesforce shares falling. the company earned $1.40 a share in the recent quarter. estimate was $1.21 the quarter guidance was below expectations the company said it would take a $900 million hit in sales because of foreign currency effects. put that in a blender and you are down 6%. salesforce said bret taylor is stepping down a year after promoted to the role of ceo. he was on the board before elon musk took over the company

and taylor left salesforce to found a new company. the previous co-ceo keith block left that role after 18months. speaking to jim cramer on mad money, discussing the pivot amid changing conditions. >> you have to constantly reshape the company. we reshaped part of the company. we will continue to do that. you have to look at everything as the market is changing. every industry has a different characteristic some are buying aggressively and some are subdued because of what they are going through you want to invest in the industry and products that are doing well you want to pull back in the ones that are not. that is the ebb and flow of dealing with a crisis. >> the stock is still up 4% sdpl4% >> i have questions about the

call he said you can't cage a tiger is what he said about bret i don't think originally when bret took the job that he would do this for only 12 months and take the board position at twitter. i don't think he knew what would happen at twitter. you are settle thing in to a different life than running a startup. you know, marc is a bigger than life guy with a bigger vision. it could be hard >> with iger, same thing same stories of people who like running the companies and feel they can turn thing. all i can take about is when barry sternlicht was here. the hard times that companies -- by the way, benioff acknowledged this there are some companies that are not able to spend what they

thought because of the issues with the economy >> it is not tech or media it is a boring p&g in the journal >> he is not coming back to the company. everybody is pulling an iger or schultz. >> here are five things i learned after i went back to p&g in an emergency role 2000 to 2010 and 2013 to 2015. we never got him on squawk someone from my hometown >> he didn't speak very much of. he is amazing. when we come back, we will show you what reid hastings talked about the netflix ad supported tier. and pete buttigieg will talk

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good morning well come back to "squawk box. we're live from nasdaq market site in times square the nasdaq was up 4.4% yesterday. we have tech stocks up from comments from jay powell of a slowdown in rate hikes in the future let's bring in gene munster from loup we are trying to get a sense of what's going on with tech right now. especially given the price or

what jay powell said and now people are back to the races does that make sense to you? >> it makes a ton of sense i want to put powell's comments in perspective he did not say anything new. he did not pull a jackson hole hinting rates would go higher than what investors would expect that threw his last comments and market into a funk we didn't get that which was feud as a positive the market has a sense that the rate hikes for the next six months are in place. i want to possibint out what is change in the conversation in the fed comments we have been so focused on that in the last six-to-nine months, especially tech investors. i believe chairman powell's comments are less important and we will get to the phase of the earnings matters most.

andrew, the bigger question to me is less of what is going with rates and inflation and more about what is happening with earnings i suspect they will be going down in the next couple quarters >> i want to pivot the conversation yesterday at the dealbook conference, i spoke to reid hastings he said he changed his sdantancn adding advertising to the platform >> what i failed to understand is a lot of tv advertising could not find viewers because the 18 to 49 segment moved online they were not watching lineal tv advertisers are desperate for connected tv solutions that is the real thing i missed. we didn't have to steal away the advertising revenue. it was poring into connected tv if the inventory is there. >> gene, it sounds like he would have liked to do this years earlier, he now says, if he could. >> quite a surprise. that was different from what he

had been saying publicly i guess hindsight is 20/20 i'll put comments in the bigger arc at netflix near term, they arie doing a god job. cracking down on the piracy and sharing of passwords there is a lot they can do t there. that is all in the plus column in the next 6 to 12 to 24 months applaud that piece i do have some concerns, longer term, about the market and ultimately the competition within this. yes, he wanted do it before. i think netflix investors will be happy over the next 6 to 12 months not only with the ad market, but password sharing. >> gene, always great to get your perspective thank you. >> thank you coming up, the senate holding a hearing on the collapse of ftx today. we will tell you what to expect next. then, later, don't miss the

interview with transportation secretary pete buttigieg for the latest out of washington to avoid the nationwide rail strike "squawk box" will be right back. >> announcer: currency check is sponsored by interactive brokers. the professionals gateway to the world's markets.

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take appliplace on the collapsef ftx and more we have ylan mui with the latest ylan, let's get the senate involved our problems are solved. >> reporter: at least take a look at the problems and see if there is a solution. lawmakers are vowing to find out what happened in ftx and severing their ties with the company. the senate agriculture committee will hold the first hearing on the collapse sam bankman-fried has roughly donated to 7 of 22 members debbie stabenow got the most in contributions. another $20,000 for her victory fund john boozman also with $5,000. others got cash from sam bankman-fried. john hoven will send it to a reimbursement program set up dick durbin and tina smith will

give the money away to the non-profit cory booker has not responded to emails and brushed off the question when we asked about it in person. sam bankman-fried will not testify at the hearing today the sole witness is the chairman of the cftc rostin benham. current ceo john wray is in the hot seat for that one. i asked patrick mchenry if sam bankman-fried would testify at that hearing he told me, he has no update to share as of now. back to you. >> that's cory booker, who also wrote the letter of character for elizabeth holmes >> the kimono. we know what is going on when they open the situation. the chairman -- both chair

people investigating the investigation -- both has contributions? >> reporter: yeah. i will say this was something that washington was a little slow to wake with up on or catch up to. it took multiple emails and multiple times to ask lawmakers what they will do with the donations. there was not a knee jerk money is going back right away it took time for them to dough s decide what was going with the money. that was the amount of leg work sam bankman-fried had with the relationships in washington. the last time we saw him on capitol hill, if not one of the last times, was before the senate agriculture committee when he was testifying around the role of ftx and trying to be able to directly clear customer transactions he had become the face of crypto on capitol hill. now that has done a complete 180

and everyone is trying to get as far away from him as they can. it did take time for lawmakers to work through that and own relationships to ftx >> k street. we know there is a k street. we know how things work. it gets a little bit -- i don't know -- why are we surprised i guess, ylan, there is no stated quid pro quo. people must expect something when they contribute, i guess. what is it a wink and a nod not a good way to run a country. >> reporter: let's be clear. there are plenty of ceos who donate to candidates on both sides of the aisle this is the hard spot for businesses on the one hand, you want your voice heard in washington. on the one hand, you want p policymakers to consider the industries they're regulating. on the other, when you have a stunning collapse likes ftx,

suddenly it seems like did the influence game go too far. that's what folks are trying to suss out right now sam bankman-fried's defense was there wasn't anything particular that he was asking for with congress he departmidn't have an applicar lay es lic license. >> shocked there is influence pede peddling in washington, d.c. that works a lot unfortunately. thanks, ylan we'll see. now to the latest from china. there are signs in the last 24 hours the country's covid restrictions may be easing despite no sweeping changes being mentioned from the central government at the local level, media reports say some people who tested positive for covid in beijing may now be allowed to quarantine at home instead of

whisked away to a centralized facility in guangzhou, the city hit hardest by kocovid, they are allowed to have in-store dining. and officials are downplaying the variant. the vice premier says china faces a new covid situation as the omicron variant pathogenic nature weakens and experience with covid prevention and control. that's how it begins. when we come back, we will talk about the latest chapter of the broken system of illegal immigration is crushing the economy. reminder, you can get the best of "squawk box. follow us on the favorite podcast app and follow us anytime. we'll be right back. ♪ it's a lovely day today ♪ ♪ so whatever you've got to do ♪

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among other things, jay powell yesterday also cited the shortfall in legal immigration as a major reason for the nation's labor shortage, and a source of his concern about wage-driven inflation and wage hikes. steve liesman concludes his three-part series on the nation's broken legal immigration system with a search for solutions and the consequences if we fail to fix it it's ours. >> reporter: on u.s. highway 101 and new york city's time square,

billboards beckeoned workers to canada despite growing competition from talent from abroad and pleas from u.s. businesses to solve a worker shortage, the u.s. political system is gridlocked on immigration reform. >> the united states is discouraging potential health care workers have trying to come to and work in the united states that needs to change what we need are system-wide reforms that welcome immigrants into our health care workforce. >> senator cornyn from texas even sponsored a bill last year to ease the visa process for health care workers. but he highlighted recently by illegal immigration stymied solutions on the legal side. >> it's hard for us to make progress on areas even where there's consensus on the topic of immigration while the border is on fire >> the battle over immigration

reform is hamstrung over the fight over securing borders, pathways for citizenship for undocumented immigrants and they underpay american workers. experts say solving the nation's legal immigration problem can help reduce inflation, ease the worker shortage and maintain america's technological lead among the fixes that are needed, an increase in the quotas for h-1b visas the quote of 85,000 was set in 2004 and hasn't been changed since. a special carve out for badly needed health care workers and a relaxation or a change in licensing requirements so they can work in their trained field. a path to citizenship for foreign students with advanced degrees. protections for u.s. and foreign workers from abuses of the visa program.

>> another issue with the h-1b is the way that the wage rules are set up which have allowed employers to underpay many workers by tens of thousands of dollars a year. >> reporter: but even critics agree that the it needsto be increased. other countries like canada will find the talent. ottawa announced it would boost its count to half a million. before he was famous, albert einstein applying for a visa program would have just a one in six chance of being admitted to the u.s. he might more easily end up in canada immigrants accounted for 30% of noble prizes awarded to americans since 2000 in chemistry, medicine and physics. 45% of the companies were founded by immigrants. 1 in 25 were founded by immigrants. >> in other words, you're pointing out that we are risking

our future as an innovative country. >> the noble prize is awarded next year. and in the next five years, those folks are already in the country. 10, 15, 20 years down the road, a lot of these folks do their best work for some reason in things like math and science before they're 30. >> i think you made the point yesterday, the day before when we were talking to -- look, we want the best and brightest of the world to come here, we educate them and kick them out. >> and then they have two or three years to get a visa and then we don't quick them out, but, yeah, pretty much it's quite remarkable. and what's beinteresting is, yo got a guy like cornyn who sponsors the bill, but they can't get there. not all democrats favor opening up for specialized workers some do. there seems to be pretty good agreement but they can't even do the obvious things in front of them which is what's so frustrating about this story. >> right i was going to say we're all

immigrants, but then we're not all immigrants sometimes we think about that that the -- it started in 1492 >> do the math, right? think about it if you get to the point where you can come into this country and you've been invited in, you are almost by definition smarter than the average bear, right and so you get to that point, you are going to be something who is going to -- >> self-selecting. >> self-selecting, right einstein, one in six chance getting in if he wasn't famous. >> jay powell's comments yesterday sparked the huge rally in the markets we're going to dig into the implications for this moh'nts policy meeting and the markets too. that's straight ahead.

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sam bankman-fried speaks >> i underestimated what the scale of the market crash could look like. >> the disgraced ftx chief on the collapse of his crypto exchange we will bring you the highlights the house voting to block a potentially crippling rail strike pete buttigieg will join us live with the latest from the white house. we're on oil watch as colder temperatures approach and an opec plus meeting is looming the second hour of "squawk box"

begins right now good morning and welcome back to "squawk box" here on cnbc live from the nasdaq market site in time square. i'm joe kernen, along with becky quick. andrew will be joining us shortly. he's got a bigger fish to fry. he's around. he'll be back. we've got a lot of media outlets at this company. >> we do >> i'm proud to be part of nbc universal. >> it's nice to be wanted. andrew, in this case, but it's nice they want one of us u.s. equity futures at this hour are a little better than they were remember, 750 points and it went 300, 400, 500 as the day went on all after -- all after powell all after powell basically

repeated what he said last time. >> but he said it this way. >> he said it this way instead of that way. >> treasuries responded in the shorter end of the yield curve that's better. 4.32 is better than 4.70 it's come down from assume of highs in the yield 3.6 even what's that? 72 -- that's still 72 basis points inversion i would think oil might start going up on this news out of china. it looks like -- are they really responding to the protestors in a way that sort of concedes -- it almost looks like that. suddenly they're sort of spinning that omicron is not as bad and we've had a lot of success and you can go eat inside a restaurant. >> it looks like the end of zero covid. they're not calling it the

end -- >> the beginning of the end of zero covid. >> and then bitcoin was above 17,000 trying to hang on. now up a third of the percent. >> let's get over to dom chu. >> to your point about the zero covid policy, let's start with a check of shares of apple right now which are down just around 125,000 shares of premarket volume they u did, of course, gain 5% in yesterday's trade on that fed surge post-powell comments but this morning, analysts cut their revenue forecast for the tech giant as well as estimates for overall iphone sales because they cited among the other things china's lockdown measures during the past several months which are crimping production of the i-phone in china shares down just fractionally after a big surge yesterday. shares of salesforce are

falling. the software company beat profit and revenue estimates but current quarter revenue's forecast, they fell shy of some estimates. they announced the departure of brett taylor which means that marc benioff is now the sole chief executive officer there. and then we're going to end with a check of capitol hill both stocks lower right now. they were both cut over at morgan stanley both ofthem go to an underweight or sell rating from an equal weight or neutral prior. they cited a more cautious view on consumer credit overall and higher credit losses across the industry which could lead to worsening consumer health. a macro call on the consumer, everything else taking down a couple names who have more exposure so that >> thank you we'll check in in just a little

bit. jay powell confirming that smaller rate hikes are in the offing despite seeing progress in the fight against inflation >> monetary policy affects the policy and inflation with uncertain lags and the full effects of a rapid tightening so far are yet to be felt it takes sense to moderate the pace of our rate increases the time for moderating the pace of rate increases may come as soon as the december meeting given our progress in tightening policy, the timing of that moderation is far less significant than the questions of how much further we will need to raise rates to control inflation and the length of time it will be necessary to hold policy at a restrictive level. >> joining us now with more on powell's comments in the fight against inflation.

was it a little more dovish than the last time? the takeaway was kind of the same, smaller -- maybe not 75 basis point increases, but baby -- maybe a higher stay at that terminal rate. why did the market react like it did? >> i think there are a few things going on here first of all, there was a concern -- i didn't really share that, but there was a concern going in that this might be a jackson hole moment where powell would come out hawkish and try to stamp on the financial conditions we've seen in the previous weeks part of it is removing that hawkish overhang but i think there's more here. there's more that is dovish. first of all, he confirmed slowing -- is pretty much a done deal he did continue to lean a little in that higher, longer direction. and that's the hawkish offset they need to make sure we don't

go in the dumps with a slowdown. he didn't break any new ground there. he might have retreated a tiny pick, he said the peak rate might be somewhat higher in september and followed by -- this is his personal opinion, i think he's careful not to get too far of it of where the opinion on the wider convincing is he was more optimistic this time about the prospects of achieving that softish landing and we started to see some two-sided risk management come back for the first time in a very long time that is superimportant >> do you think chair powell believes that what they've done so far has a significant lag effect he mentioned that. because if you -- that's what i've been wishing that the fed would put more weight on and that is that we don't really

know -- we see it in maybe housing and in -- i don't know, raw commodities, other places. but three months from now, if jobs are a lagging indicator, three months from now, we may not need a much higher terminal rate do you think he -- in his hard, does he believe that and he just wants to keep talking tough because that's what we need to do to conquer inflation, or do you really think -- he thinks it's been in effective up to this point and more needs to be done? >> i suspect it's somewhere in between. i think powell looks at what is still overall a strong labor market and his gut is probably do need to go a bit higher for a bit longer but it's really not clear whether that picture, which is backward looking, is a good indication of where we're going. it makes a ton of sense to get

off this 75 basis point hamster wheel. slowdown and let the data unfold over the coming months, over the course of the first half of next year and let the data, not one month, last month data, let the unfolding data over the next six months or so guide exactly how far they do or don't need to go unrein >> we've said it's not your father's labor market. it is different and it may not be as responsive to just rising interest rates because of, i don't know, participation rates, remote work or people -- you know, not coming back after the pandemic whatever you want to look at there's all these weird factors that make up the -- today's labor market that may not be -- they may not react to what the fed is doing, the way the fed wants. so we may be throwing something at the labor market that's ineffective that hurts the rest

of the economy and doesn't even work on the labor day. is that possible >> well, i think you're certainly right. there are a lot of things that behave differently in this cycle than normal cycles and the labor market for sure is one of the very important part of what's different this time around i think the right way to think about this is if in the end the inflation rate is outside housing, it very strongly correlates with wages, if those services prices cool off, and if wages cool off, then the fed is not going to be particularly per t upset that the labor market is still abnormally tight the test is in the wages and

those services and inflation categories but if a continued imbalance in the labor market means that wage growth continues to run quite a lot higher than consistent normally with achieving the best target and because those wages are running too hot, the services and inflation beyond housing is also running too hot, the way that could become entrenched then the fed is going to continue to work at cooling off the labor market even if it does need rates higher for significantly longer >> to affect the labor market, you really have to, you know, slow down the entire economy with that and maybe it's only 20% effective. i don't know it's disconcerting and i wish we didn't have -- >> certainly you're right that therein lies the recession the fed is having to work hard to bring the labor market back

down and cool off wages and to restrain those general services priced inflation and it may well overdo it, may well be that the tightening they've already done, the lags you talked about, but as that comes through in full force over the next few quarters, that we find that it's already uptight and we end up with some kind of recession, a recession it's not clear if it is slowing down early enough. or at least stepped down earlier and given the doata a little bit more time. >> good to have you on >> thank you still to come this morning, the house passing legislation yesterday that would force a

tentative rail labor agreement and thwart a national strike that bill goes to the senate pete buttigieg will join us from the latest on that front we have the highlights from janet yellen and andy jassy and reid hastings. take a look at the futures this morning, been a little bit in the red. dow futures down by 44 after a gain yesterday s&p futures down by 4 1/2 and the nasdaq down by just 16 points after gaining 4.4% yesterday all after hearing what jay powell had to say. "squawk box" will be right back. on a comprehensive wealth plan across your full financial picture. a plan with tax-smart investing strategies designed to help you keep more of what you earn. this is the planning effect.

welcome back, everybody. among our headlines this morning, it is another busy day for economic numbers coming up at 8:30 a.m. eastern t government is going to be issuing its weekly look at initial jobless claims as well as october personal income and person spending. at 10:00 a.m. eastern, the ism is going to be out with its manufacturing index. general electric has put a $31 billion value on its soon to be spun off health care

business ge health care will be trading on its own on january 4th. and hurricane ian and other na natch disasters have caused $115 billion in damage this year ian was the single largest loss event with a total of 50 billion to $65 billion that's the most since hurricane katrina. when we return, transportation secretary pete buttigieg will join us with the latest. and galaxy digital founder mike novogratz on crypto we'll be right back. >> announcer: time now for today's aflac trivia question. what national football team has won the most world cups? the answerhen bc wcn "squawk box" continues

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pele is the all-time leading goal scorer for brazil with 77 goals in 92 games. the senate could vote as early as today on legislation to avert a nationwide rail strike but pete buttigieg and marty walsh are going to be meeting with senate democrats to brief them on the white house's brokered deal that was rejected by four freight unions secretary buttigieg joins us this morning it's good to see you >> good to be with you >> so explain what's going on here we know this passed the house. do you have the votes in the senate >> that's right. so the house took action and now it's up to the senate to get a bill to the president's desk and while the cutoff date for a shutdown is the 9th, a week from tomorrow, we would see impacts much sooner than that. if there's even the possibility of a shutdown, about five days in advance of that, the

railroads would have to begin winding down their acceptance of things like hazardous material shipment that is you can't allow to get stranded. by goal today would be to make sure they understand the implications of a shutdown or even getting close to a shutdown it wouldn't just bring down our rail system. it would really shut down our economy. and i want to make sure there's a clear sense of that from a transportation perspective congress is not always known for swift, bipartisan action that is what we saw yesterday on the house side a major vote it moved very quickly when speaker pelosi brought it to the floor. i'm hopeful that the senate will be able to move quickly to prevent the economic consequences that would come from a shutdown. >> we had a lawyer who represents many of the unions involved in this yesterday on the show, and he said that these are threats from the railroad companies that they would shut things down early. the reason they would have to stop accepting, the reason the

deadline is sooner than december 9th. >> yeah, and i'll give you an example from amtrak. so, you know, you've got a lot of passengers going out on round trip tickets amtrak is not going to wait until the moment of a shutdown in order to start issuing cancellations or warnings because you don't want a passenger to get stranded. as bad as it is for a passenger to get stranded, you can imagine the implications if a shipment of hazardous materials would get stick. the bigger point i want to make sure everyone understands, there's no substitute in the american transportation system for a functions freight rail network. there are not a enough barges, and ships and trucks in this country. it's one of those reasons that there's the railway labor act which allows congress and the president to step in, something that is done with great reluctance this is an administration that

feels passionately about the pro-union stances that the president has taken on everything from having the first card-carrying member in -- i think in decades as the labor secretary to the commitment to buy america. we're in a situation right now where the tentative agreement that was reached at the bargaining table by labor leaders and companies a couple of months ago is the clearest path forward to getting something resolved, moving forward, getting increased and enhanced pay for those workers and critically, especially as we go into the holiday season, keeping goods moving in america. >> i was going to ask you about that this was negotiated, not just by the companies and the labor union leaders, but it was signed off and overseen by the presidential emergency board that weighed in and made sure this was going to be a fair deal you had eight or nine of the unions involved actually ratify it already what happened with the holdouts? to see the administration run by joe biden who calls himself the

most, you know, union-sensitive, to see them move like this, were they asking for far too much >> well, look, there were 12 unions that were party to this deal eight of them ratified but four of them did not and that reflects a large number of the workers involved. workers are understandably concerned about -- look, they feel that even being able to use the unpaid sick days that they do technically have is almost impossible because of the attendance policies of the raids. tha there were concerns about pay and health care and all of those got weighed at the bargaining table. that final product is not any one party would say they got all they wanted. nobody would say it was perfect. but it does reflect the results of that bargaining and where we are now is a situation where it is almost unthinkable what would

happen to the u.s. economy if we reached the point of a shutdown. we're talking about energy refineries that would be unable to ship out their by-products. they have minimal storage on site at a certain point they would have to stop operations. for a refinery, that's obviously once you stop, not something you can throw a switch and start again. dairy farmers who rely on rail both in order to get the feed in and in order to get their products out food generally, especially with regard to grain and baked goods, you would start seeing spot shortages fairly quickly in the context of a shutdown. my department estimates 765,000 workers would be laid off within the first two weeks and it would only get worse from there. the auto industry, auto assembly plants typically only have one to two days of parts on hand it wouldn't take long before they were unable to operate. i hate sounding like the ghost of christmas future here, but i

want to make sure everybody -- especially the decisionmakers -- understand the implications of what happened if washington allowed this to move toward a shutdown. >> it's not often that you get bipartisan agreement in congress in the senate you have a couple of holdouts. bernie sanders said this is not fair on the opposite side of the aisle, you have marco rubio saying he's not in favor of it either of them could hold this up by going to a filibuster. >> like most things in the senate, this would need 60 votes in order to advance. i defer to senate leadership on tactic and is strategy you would see impacts well in advance of the 9th with our economy in -- everything that we've been through, the headwinds that we face, this is something that

would be a decisive turn for the worse if -- i'll tell you what i said to the labor leaders and the companies when my administration colleagues and i addressed them all at once urging them to get a solution at the takeble in september if a shutdown would happen, looking at the history, you would say there was covid, then there was this rail shutdown, and then 9/11 in that order, in terms of how severe and complex the implications were. >> how much anger are you getting, how much blow back from the unions that have not signed off and ratified them. you're cutting them off. they have no further room for negotiation on this. >> this is about enacting a tentative agreement that was reached by labor leaders and company leaders alike. it isn't perfect no one side will say that they got everything that they hoped

for, everything that they wanted but we're in a situation right now where the american economy is literally on the line and as much reluctance as there is, certainly in this administration, to have any kind of process that intervenes like this, there's also a reason why i think 18 times so far, since the railway labor act was passed, congress has taken a step to do that, to make sure that the american economy kept running and to protect the economic and national security equities that are at stake at a moment like this >> you think bernie sanders and marco rubio are using this as a way to kind of further politicize things? when you lay it out and talk about the real implications for the economy, for so many workers, for businesses around the country, i mean, it sounds pretty dire. it sounds like there is no alternative. >> well, i can't speak to any senator and their thought process, but when i'm addressing

senators, as i'll be doing later today, what i will be emphasizing will be that, the impacts that would be associated with any kind of delay in the process here and they would hit everybody from industrial workers at factories no longer able to operate, to farmers no longer able to get their supplies, to families who would see the upward -- just as we're starting to see inflation cool off, we would see that upward pressure on prices on everything from anything related to refineries to just the goods not getting to where they're going. this is something that i hope makes it possible to put politics aside, lay aside any of the twists and turns that go through the normal tortured path to legislation getting done and, again, if that sounds optimistic, i would say we saw exactly that in the house yesterday. an exceptionally swift and exceptionally bipartisan vote around that tentative agreement. now we're hoping the same can happen in the senate

this needs to get to the president's desk by this weekend. >> secretary buttigieg, thank you very much. good luck today. >> thank you still to come, we got a lot more right here on "squawk." elon musk taking aim at apple's app store cost for developers. is it time for tim cook to reduce the fees? that's the question. jon fortt is here to weigh in next. much more of that big interview with sam bankman-fried. >> there was no person who was chiefly in charge of positional risk of customers on ftx and that feels pretty embarrassing in retrospect.

welcome back to "squawk box. we're live from the nasdaq market site in times square. take a look at the futures this morning. some red arrows, but they've moderated since we started the show they were never down by much but the dow futures down by 23 points ten-year note, the entire treasury complex, down across the board significantly. in fact, the ten year has fallen below 3.6%

some very massive moves yesterday after we heard from chairman jay powell. didn't say anything that sounded all that new but it was reassuring for the market, i suppose, to hear that, yeah, it looks like it's going to be 50 basis points and they're slowing the rate of hikes. >> apple's app store is in the spotlight against this week as elon musk argues the company takes too large a cut of transactions on the platform should tim cook reduce apple's app store fees in a downturn jon fortt is here to weigh in. >> joe, yes, tim took should it's inconvenient that elon musk is the one to bring this up. but this really would be a great time for apple to reduce app store fees apple charges a 15% fee on paid apps and in-app purchases for developers who make less than a million dollars in a year, 30% on those who make more the reason why tim cook should cut fees here, inflation is

making it more difficult for every business to run profitability. showing some flexibility now, apple can take itself out of the regulatory spotlight and if he plays this right, cook can put the spotlight on google and amazon which have a tougher argument to make in google search, they're competing with third-party merchants for placement in the results. by lowering the fees, apple can turn the heat up on competitors. >> that is probably -- didn't apple just lower fees a couple years ago. and now they have to do it again for elon musk? >> well, joe, yeah on the other hand apple absolutely should not lower its app store fees the idea is absurd android actually has higher market share if you don't want to pay apple's app store fees, don't sell on

the app store. outside the digital world, you don't get to walk into a luxury storefront and say, you know, the rate you're charging here is insane i demand you lower the rent because the premium is the point. you go to fifth avenue for a high-end experience. no one is forcing you to shop there. it's not apple's fault they built a thousand dollars smartphone and an app store where shoppers want to buy digital goods. it doesn't mean you get to name your own price elon musk tweeted that apple puts a secret 30% purchase on its app stores apple put out a press release detailing its fees detailing who pays 15 and who pays 30. >> could apple get pressured into lowering prices >> that's what some folks are

trying to do and what they tried to do a couple years ago look, apple is in this position where they're a premium provider at a time when supplies are getting crunched out of china. if they just keep their message discipline, which they tend to be pretty good at, i don't think they're getting too much pressure. >> did you hear anything about the meeting yesterday -- it went well from what we could tell i said earlier, i was paying to see these two great icons and i think tim has reached the icon stage at this point which a lot of people thought wasn't possible after steve jobs. can't we all just get along? are they buddies again >> for a time, maybe the at the with all of these big tech company's, somebody else's margin is my opportunity >> but do you think they would take twitter off the platform, really, given how many people are on it and how many people use the apple phone.

unless something truly egregious were to take place >> i think it would take something egregious. that's beyond a shot across the bough. that's just a shot. >> coming up, we're on oil watch as we head towards a very important opec meeting i forget about that. brian sullivan on his way to vienna wti, 82. and check out the shares of kroger reported better than expected profit and revenue for its latest quarter idce raised its full-year guan "squawk box" is coming right back >> announcer: this is cnbc program is sponsored by baird. visit bairddifference.com.

welcome back to "squawk box. sam bankman-fried speaking out on the collapse of ftx he joined me live via video feed from the bahamas yesterday trying to spell beliefs that he tried to swindle customers of the crypto platform. >> it was a specific crash on assets associated with the alameda research rather than all assets and so, you know, even hedges had limited use there. and a run on the bank at the same time, and all of those are

things in retropspect i should have expected. we've seen other examples of that in history where when things get really bad, they get really bad for all of the relevant things at once in a very direct and correlated and quick way. >> bankman-fried's comments came on a senate hearing on ftx's collapse we're going to have reaction to that interview with mike novogratz. we're going to do all of that in the next hour. a lot of questions still on folks' minds about what exactly happened and it goes back to the issue of comingling the assets more than anything else. there is the problem of the trades, if you will, that he was making, which is to say that he called the market wrong, but if he was using customer funds effectively to loan himself money to make those trades, that

unto itself is largely the problem. >> it's the comingling and the marking of -- when it comes up on the tokens. i know you asked him about that too. to me, he comes on and he says, oh, i just want to answer questions and help out where i can. but i don't know if i believe any of the answers that he's giving on this stuff some of it he doesn't know because he's been locked out if you talk to the guywho is running this stuff out who did the enron bankruptcy and now working on this, he said in filings that this guy is not making sense and is talking irrationally and doesn't know what he's talking about or is flat-out lying and it's the -- you got into that with him too. he was marking up this token that he made up and putting his own mark on it based on what he was loaning out to his own companies, loaning them the tokens and marking them worth billions there was an $8 billion hold. >> i think in the end this is -- and it's the hard thing when it

comes to liability, there's civil liability which i think is clear and he has it in spades. i think he's concerned and worried as he should be that he has criminal liability and what was his intent and i think what at least he's trying to do -- and it depends on whether you want to believe him or not -- is whether this was a premeditated manipulation of the system that this was a plan and a strategy in terms of what he was doing from the beginning or whether it was something else and that's what we're going to have to -- >> 100%. it comes down to he's trying to say if i'm an idiot or a criminal, i'll take the idiot defense. >> that would be -- if that's the position you're in, that's probably the better position to take meantime, we're going to show you some other sound as well i kicked off the conference with janet yellen asking her about the ftx collapse and its significance here's what she said to say.

>> it's a lehman moment within crypto and crypto was big enough that you've had substantial harm of investors and particularly people who aren't very well informed about the risk that they're undertaking. and that's a very bad thing. >> and interestingly, given all of the speculation about money and politics and sam bankman-fried's lobbying efforts specifically in large part with democrats, i asked her whether she had ever met with sam bankman-fried. she said she had not and she said now she has no intention to >> wise choice. >> it is not a bad choice. not a bad choice. >> last month, president biden said elon musk's relationships with other countries is worthy of being looked at and i asked secretary yellen about this and she clarified some previous statements. >> let me clarify. i misspoke and let me say to the

extent that there are international investments there, we have an agency within treasury called cfius. i'm not going to talk -- we do not talk about particular transactions but this agency does look carefully at transactions that could pose risks >> biden saying take a look at it she said, we're not taking a look at it and now it sounds like she's saying maybe we will be taking a look at it >> again, i was just saying, your head has to be spinning from all of these incredible interviews yesterday, going from one to the next. my hats off to you well done. >> thank you i'm delirious. >> it was a lot. it was drinking from a fire hose yesterday. >> we got a lot of news, a lot of headlines. >> we've still got plenty of time left in the show. >> what did larry have to say? >> larry fink, we got to talk about larry fink we'll do that in the next hour

too. >> when we come back, though, a big meeting for opec plus members as colder weather approach and is a programming note for you, it is pro week and a new way to trade with the pros you can join dom chu at 3:00 p.m. eastern time for a new cnbc experience called "the tick". it's live at 3:00 p.m.

first of all, we've gone on a wild ride this week with output news from the opec meeting. for a closer look let's bring in john kilduff and heidi heitkamp, former senator of north dakota she's now a founding board member of one country project and a cnbc contributor, and thank you both for joining us. i'll start with you, john. what are you expecting to actually happen in the next week or so? in terms of opec, joe, or the market itself. >> in terms of opec. what are you going to hear we're going to hear that they're studying the market and they're going to remain highly reactive, ready to move and they will not make any additional cuts in this meeting, in my view. they just announced a 2 million

barrel cut according to the preliminary data that we're getting for last month i think it's a wait-and-see approach for them right now, particularly joe because they are acknowledging a couple of things the situation with russia and the embargo on the price cap potential and we're entering the peak demand period for the world and the northern hemisphere winter is the big game here, and so i think they're going to sit tight for now. >> we do think for supply of the spr. what's your view on the venezuela-chevron deal can it come online more quickly? can you justify the biden administration going down to venezuela versus a lot of people criticized the treatment of the majors here in this country? was there a good reason to go to venezuela? is it faster >> it actually is faster, joe.

look, it's not a good look, obviously. maduro there is a horror show in a bad situation, but look, we're in a tough situation here with the russian situation especially with the european embargo that's coming also, too, the economics and the permian basin right now just aren't great the folks down there between the regulatory situation to a degree and just the numbers and the labor costs and the material costs if you can get both of those just aren't making sensual that much right now believe it or not with prices where they are. this will get barrels to the market most importantly, the venezuelan oil is the oil that was historically for our gulf coast refiners, this heavier crude that they can produce whereas the permian actually isn't we're in a tough spot right now. beggars can't be choosers. i think it's a great move. >> we had a frequent guest on

yesterday for the administration, and i asked him is it helpful when the president continues to -- i think he's speaking to certain parts of the democratic party when he says we are going to end drilling and almost conceded that we are going to be -- what i got from him we're going to need to use oil for several more years, and that's where i don't think that's the correct -- several more decades what do you think several is is that three to five years? heidi, there's no way we're done with oil in three to five years. >> no. anyone who actually follows the market and follows what needs to happen in this market to do that conversion believes it the problem with the president saying it is it sends the wrong message to the market. you have high input costs, and a need to actually see higher prices in places like the

permian to make that economic in terms of investment and then you rattle the cage on education and on shutting is the industry down and it's not a productive look there's a chance to have a conversation about what we need to do to improve our opportunities here in this country so we don't have to go to venezuela, so we don't have to go to saudi, but we've had now how many years of shale product where we produce light sweet crude, but yet the refining industry continues to refine as john said. the crude from places like saudi arabia and venezuela so a real conversation about this would be really great for, number one, our economy, but more importantly, for just telling the truth that this is not an industry that can turn on a dime you've got to see these transitions. >> it would be nice to get there. i like the name of your country, we still are one country

why do you think we can make progress with both parties and the biden administration to make it easier for refiners to do what they need to do, to make permitting easier or when we hear the president say, what do you think is the motivation for when the president says that is it what i said that he's speaking to certain parts of the democratic party and the climate advocates? who is he talking to it's not productive. it's not helping >> i can't speak to his motivation on who he's talking to or who he isn't talking to, but the lawmakers and policymakers that i talked to know that we have to have stability in this industry one of the places where everyone appreciates it is in fpermitting and where are we going to get the minh cals that we need to make this conversion to evs?

i think there are smart people who are not just ideological, who are actually thinking about how do we move this forward? i have a lot of hope that there might be an opportunity for a centrist, bipartisan analysis especially in the area of natural gas and so we can really do great things for american consumers and great things for our environment if we figure out how to talk to each other. >> okay. thanks, heidi. are you not talking to chuck schumer or the biden administration anymore i mean, that's some crazy stuff you just said. you might be getting a call. i would block those numbers if i were you >> it's all good, joe. it's all good. >> okay, good. once you get out of politics you don't have to -- >> say whatever you like >> say whatever you like >> i did that when i was in politics >> you can speak honestly like kilduff. thanks a programming note, chevron ceo

mike wirth will be joining us for an exclusive interview tomorrow to talk eney rgpolicy, opec plus and much more. "squawk box" will be right back.

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good morning the 2022 finish line, it is in sight, welcome to december markets concluding november with a bang thanks to comments from federal reserve chair jay powell we'll get to those as well as brand-new inflation data this is the number the fed pays its closest attention to, and sifting through the damage at ftx. sam bankman-fried saying he was shocked at his firm's collapse and he says he never tried to defraud anybody, reaction straight ahead from crypto pioneer mike novogratz as the final hour "squawk box" begins right now. ♪ ♪ good morning and welcome back to "squawk box" here on cnbc live from the nasdaq marketsite in times square

along with becky quick and andrew ross sorkin the dow has been making its way back to the green after initially being down less than a hundred points after that big move yesterday across the board in the averages after the market decided that jay powell just seemed a little nicer about -- maybe not being quite as grinchy at christmas as we had been. assuming maybe 50 basis points still going to higher levels for a sustained period, he said. the market seized on whatever positives it gleaned from the comments yesterday and the dow is up 750 points and it is up 20% from the low so you call that and it's like the two straight quarters -- >> i keep doing that, and i'm sorry. . >> take a newspaper. >> i have an ipad, folks and for some reason it's making that noise against the -- >> anyway, as i was saying

a quarters, and i don't know. >> you get to the question and concern we brought up earlier. if you start to see risk assets move, first of all, equities and more importantly the treasury market are we in a bull market? were we in a recession that's bwhat i mean. we need new definition >> they seem to think that we're going to go into some kind of longer term malaise down the line i don't know when he really thinks that means right this second >> like, maybe it's not a deep recession and you don't get out of it for a very long time and that could be detrimental. >> when you get a 40-year period of sustained low inflation and low stock market activity and if there is any reversion at all and the bullish people would say look at advances made.

people -- i mean, we're the -- mankind, humankind is doing better than it's ever -- i can't believe there's a potential for a nuclear war. putin not withstanding we are doing better in terms was life expectancy and treating disease and technology and instantaneous -- and everything is going well >> stocks will be unchanged. ten years -- a decade. >> a decade or as some people call it several years. thousands of stocks in the s&p 500. let's get a check on crude oil right now with some news out just in the last few minutes take a look first at prices. we have looked at $81.50 for wti. it climbed up pretty steadily and just a few days ago we talked about the lowest levels since december of last year and that's when wti touched at $73

and change and the european union's executive arm is asking member states to approve a price cap on $60 barrel and that's according to "the wall street journal. there no guarantee that this would be the final guaranteed upon level and it can reach a deal at this price the question is what that would mean to opec plus when they're meeting this weekend, when you hit a deal like that, opec plus can be looking at cuts in production in the meantime, the senate, a lead of that transportation secretary pete buttigieg will meet with senate democrats on the white house's brokered deal. buttigieg will join us in the last hour and this is what he told labor leaders and the rail companies back in september. >> if this were to happen, if a shutdown were to happen and later on looking back at the early part of the 21st century at transportation shutdowns and

economic implications and you would say there was covid and then there was this rail shutdown and then 9/11 in that order in terms of how severe and complex the implications for transportation were. >> he laid out a pretty strong case to us about why that shouldn't be happening and he'll be meeting with senate leaders later this morning and co-ceo brett taylor will be stepping down at the end of january leaving the kchairman mark benioff as the sole ceo. here's what he said. >> it's a gut punch. running a company and i've been doing this now for 25 years. you look for the best people in the world to bring them in, and the hardest part is when they tell you that they want to -- want to leave and that's where we are with brett. brett's going to be leaving at the end of the year. >> in the meantime, shares of sales force are down significantly down by more than

7% let's get to dom chu he joins us with a look at the top pre-market movers. we've gotm more reads by the american consumers we start with grocery store giant kroger those shares are up 3% big market and it reports quarterly profits and revenue that beat estimates and helped along by momentum in the private label or store brand goods as inflation-weary shoppers look for more cost-effective alternatives to their everyday staples and they also came in better than expected and kroger raise the full-year forecast on the discount retail front, you have shares of dollar general moving in the opposite direction and moving in the pre-market and 80,000 shares of prevolume and profits missed analyst estimates and sales growth at existing store locations also better than

estimates and it cut its full-year forecast due in part to higher supply chain cost. mixed negativity being accentuated and we'll end with designer brands to round out our consumer check and those shares are down roughly 7% on pre-market at 15,000, 20,000 shares or so of volume and this is the shoe retailer behind brands like dsw and camuto group and it reported disappointing revenues and designer brands cited among other things the same pressures across the consumer landscape that other dealers are looking for, as well, while looking to balance inventory levels and overall andrew a cutting of forecast and not something a lot of traders and investors like and that's why designer brands are down 7%. i'll send things down over to you. we should mention the kroger ceo will be down on closing bell and it's an important view we will show you sam bankman-fried saying months ago

that he was excited about the prospects for ftx. what a difference a few days make >> core metric, and will we be able to make sure all customers are whole, and you know, on november 5th i was feeling quite good about that. on november 7th i was feeling quite uneasy about that. >> industry veteran mike novogratz, we' tk outhllalabt e emerging picture of what went wrong at ftx stay tuned right after this.

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box. i want to get to sam bankman-fried's comments describing how he says he should have been better prepared for things to turn south this was a specific crash on assets associated with alameda research rather than all assets, and so even correlated hedges had limited use there, and the run on the bank at the same time, and all that are things in retrospect i should have

expected might happen in an extreme scenario because that's how markets work, and we've seen other examples of that in history where when things get really bad they get really bad for all of the relevant things at once in a very direct and correlated and quick way >> joining us right now to get some comments and views on what we heard from sam bankman fried and founder mike novogratz, i sat there trying to, frankly process what sam bankman-fried had yesterday, believable to you? what was your thought? this is a young guy that was in distress it is delusional sam is delusional about what happened and we can all be dime store psychologists and there's a lot of narcissism there and grandiosity and being a psychologist isn't going to help he will be prosecuted and he

will spend time in jail. they perpetuated a large fraud and it wasn't just sam you don't pull this off with just one person, and so i'm hoping that the authorities get to the bottom of this faster and not just for the sanctity of the crypto mark, but for all markets. markets are based on trust and when you have trust broken like this, it questions everyone else and we start looking for black swans everywhere and in some ways this is the story of the moment because it is such a giant story, but it's, you know, you're seeing someone who is just spewing more lies and listen, sam's always been kind to me. he has a kind demeanor that was part of the schtick, and i'm not saying he even planned this all like a criminal mastermind what they did was criminal and they need to be prosecuted for it >> i think that's going to be the question it seemed to me like he was taking the defense if i have to pick one of these, am i a criminal or an idiot, he'll go with the idiot defense. he has to know, right, mike?

>> stanford is one of the best universities in america and he worked at james street and those guys are fiercely good i can tell you every loss i had in the lehman brothers crash every mistake they made. traders don't forget how they lose money and it's kind of the dna of anybody who spends their time in this field, and so it's just kind of a pile of malarkey that he says oh, i didn't understand how much risk we had. these werehuge bets and they were huge bets with my money and other depositors' money. >> that is the most important point about this he's talked about this in the context of making some bad risk assessments, and that may very well be true, but perhaps the more important component of this is whose money he was making those with >> stole your money and oh, man, i should have managed the stolen

money better it was the theer oory of the ab to some degree i know he's going on another show to soften up this case, maybe that's their strategy. you saw bill ackman say maybe he's telling the truth and i tweeted him and said you're crazy and bill is one of the surest investors out there sam's compelling and that's why he was able to snooker the entire planet. >> let me ask you this, though first of all, i should tell you, it may very well be his strategy if that's the case and i don't think it's the strategy of those around him and advising him, i can almost assure you of that as somebody who has been in touch with that whole universe ahead of this interview. the question i would ask, though, is you said i don't think you might have planned to be a criminal mastermind and yet the question is if, in fact, what you allege or speculate

happened you would have to think he was >> well, again, some people start off going down the path, they get in trouble and they start breaking the law thinking they can get it back it's a tale as old as time, right? might not have started the plan of we're going to go rob everybody and the moment there was one mistake you start cheating more and you start cheating more and next thing you know you have a $10 billion cheat going on >> you thought he was making not just bad choices and mismanaging things he was doing things that he knew were illegal >> again, taking our deposits and moving them into his family office that's a big red flag to start >> one thing that i heard repeatedly from a number of people from crypto space who were defensive of sam in this regard who said, look, yes, there were a lot of people who

had their money on that exchange, where the shares were not loanable, if you will, but there were other shares that were loanable. is that possible can you speak to that and what that might mean and also how the laws in the bahamas potentially could differ from the laws in the u.s. as it relateses to this >> you know, i can't get into specifics. i know from our lending, right we had title to the coins and cash that we put there, you know, i don't know what everyone else's deals were. it would sur prisz me and even if there was a technical legal way, right there's an ethical way to do business. >> oh, no question >> this has been destroyed >> mike, the missing money, the mysteriously missing hundreds of mill mil million of dollars and it sounds like it was the bahamian authorities and do you think that was stolen from somebody else and do you think that was

people inside setting stuff aside for hem? >> it sounds like two separate issues and one is being tracked by all of the crypto security firms and every move being washed through tumblers and sold between ethereum and bitcoin and that's a pile of mono and there could be a second pile that the bahamian authorities put into safekeeping. time will tell the good news is we've got a new ceo who is a bankruptcy specialist that i'm hoping and have faith will get to the bottom of this over time >> separately, crypto in general. say bitcoin specifically is it a case of what doesn't kill you makes you stronger, sticking around at 16.5 to 17,000 or next shoe to drop is the overall asset space itself and we've tried and we've answered for bottoms before, nobody knows, obviously, but two

years from now, estimated price on bitcoin in your view. as painful as this is for our industry because it dented trust, i do think in the long run it becomes what doesn't kill you makes you stronger and this is an opportunity for growth there's two sides of crypto and ther there's a money crypto and we published our balance sheet and we came out the day we lost money saying this was our risk and i think you'll see more crypto needing to do that if they're in the mono side of the business and there are tools and you're seeing it now with proof of reserves using unchanged stuff in centralized companies and i think you'll see it that way and the unchained crypto and the tech side of crypto, there's a separate set of regulation that needs to be seen there. it's a very different group, but you'll see more and more people start migrating that way in the long run, this is a

positive, as painful as that sounds listen, you're seeing the fed starting to get into the pausing narrative, it would be much, much higher and there are 150 million people and 180 million people that have decided it's an important asset and you're not going to change their minds and so digital assets is inevitable and it will be part of our future and that's why i think you don't see the institutions backing away fidelity is not saying oh, my goodness, we made a mistake. they're doubling down at this point. >> mike novogratz, we want to thank you for your perspective this morning. >> thanks, guys. >> adviser muhammad el arian breaking down the inflation data today we'll bring you a new way to trade with the pros, real trades and real access and real money on the line. go to cnbc.com/protalks live for

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>> welcome back to "squawk box" this morning larry fink on the facebook's deal conference and i asked him from everything from ftx which

they had bought a stake in from china to capitalism. >> i believe stake holder capitalism is not political. it is not woke it is capitalism more than ever before especially during the pandemic if you're not focusing on the employees and the issues around your employees you were not doing your job >> i also spauk to amazon ceo andy jassy and his company announced significant layoffs in the midst of the holiday shopping season. i asked him what he's seeing from consumers right now >> it's very clear the consumer -- they're spending, but they're being careful about trying to stretch their dollar so we spent a lot of time having millions of deals available for black friday and cyber monday and people care a lot about getting the bargain right now, and they were attracted to stocking stuffers in a more pervasive way than normal. in discretionary categories like

computers or electronics or tvs. you see people trading down in models just to try to get more for their money. >> then immediate talk and i was joined by netflix co-ceo reed hastings after disney announced bob iger was returning to lead the company. hastings tweeted i'd been hope iger would run for president and he's amazing and i asked hastings about the competition with disney now that iger is back >> i was ready to be a fund-raiser for him. i think he'd be an amazing hard to win the democratic primary, but he'd be an amazing leader for the country, so i think very highly of him and it was darn and have our good and very disciplined and 25-year disney guy and it's not like we saw any cracks and disney is very likely to be a big success in streaming and they've got incredible ip and hundreds of millions of subscribers and they're often -- it will be at least the two of us duking it out for a long time

and that's very positive for us because that's what creates strong content against tiktok, you tube, video gaming, et cetera >> speaking of the streaming wars, i sat down with ben affleck and asked him about the business of streaming and when to win in hollywood. >> first, the movie "the way back" it came out the first weekend of the pandemic and i th w my best performance and i knew before the pandemic, nobody will watch it nobody will go out of their house to watch the move bethe alcoholic whose kid died and it doesn't fit that, but i was really happy when they made the decision to put it right on streaming and it was a captive audience and it leads to a bigger stream run and they're looking at this and these companies and weighing that now.

imd i would say we have to learn to,ato adapt and be wise. >> there are so many of those they wanted to talk about. larry fink, he thinks fossil fuels will still be needed 70 years from now >> i was going to talk about larry, too yesterday arthur brooks was on amazing as always, but one of the tweets we put out 2.3 million views because elon happened to see it and it was about elon's response was we need to cancel, cancel culture, but arthur's point was 93% of the country hates how divided we are right now. 7% are the activists who are on twitter, demanding and bullying twitter to take a stance on culture issues, and he is begging ceos not to go for the bait and not to be a pawn in the culture wars and when larry fink says stake holder -- and more important than anything, there's a difference between carrying about all of the different

shareholders and entering into the culture wars with what king larry or the world according to larry dictates with eps. >> i get put into a position of having to -- >> you don't need to let me say this. i think actually, i think arthur's right, andrew i think if you read -- if you read the letters from larry, they're actually more consistent than i think you believe, first to say -- >> he's also suggested from the beginning. >> not just climate. not just climate it's across the board. the world according to larry and if you have etf and you can vote your shareholders and they're not voting and they're ignorant so larry can come in and decide and he's the one that gets the vote, but that's not going to last >> black rock is making moves so more and more shareholders can vote >> on that, i think he's right that he did it for a reason and he knew it was a scam all along.

sam bankman fried. >> either you have to believe -- you either believe corporations are people and they can actually weigh in on social issues or they're not. that's an issue. >> they shouldn't be weighing in for the company. what if they were crazy right wingers like chick-fil-a or something. >> if corporations couldn't weigh in on other issues >> time out. >> date, get to rick yes. this is jobless claims for the week ending the 26th 225,000, 225,000 and that's the lightest -- just since a couple of weeks ago when it was at 223,000, continuing claims whoa 1,608,000. that is a big number we haven't popped over 1.6 since february so that's the highest level since february 25th. now is high good or is high bad?

it all depends on how much credence you put in the fed and they're forecasting on where inflation is and up a powerful up 0.7 and that's going back to october of last year and on the spending side, exactly as expected and up 0.8 and that's the best read since june of this year and if we look at personal spending, a real spending and that was up 0.5 exactly as expected and now let's go month over month, deflator up 0.3 and remember the high watermark there was 1% in june and we've come a long way down and if we look at the year over year deflator and it's at 6% exactly as expected. it's 0.3 lower than a slightly revised 6.3 in the rear-view mirror and the high watermark was in june of this year and it's 7%. like once again, like many numbers and yes, it's too high

and it's not nearly as high as it was and we're up 0.2 and finally, personal consumption and core deflator exactly as expected, 0.1, revision from last month and it's 0.2 lower and the high watermark going back to 1983 was 5.41 and that was in february of this year so we could see that that is the stickiest of the bunch, but still making progress. if you look at the market, the yields are moving down again yesterday, in my opinion the big news was despite jay powell speaking, the market had the last word and the last word was very bullish for both treasurys and stocks we know what investors are thinking about inflation joe, back to you >> we keep talking about that. maybe theyare just investors they're always set up bullishly and they're used to 40 years of rising asset prices and maybe

they grasp at straws at the slightest thing. so you think the market -- >> 20 years of central banks floating asset prices. >> but the market -- i think liesman's going to get mad the market's rid and the fed's wrong? >> the markets are always right because they cut you a check based on the closing price [ laughter ] snoof you're not going to take the bait >> i actually asked it and then we actually said -- maybe the ten-year might know, like the -- bo knows the ten-year knows, but the two-year tells us what what to do, but you say both know. you're gone? rick >> are you still there >> no, i'm not gone. i'll tell you what, it's not that they know anything. it's that investors have an opinion and their opinion is that in the real world there's risk and there's reward. you need to take more risk to

get a bigger reward. if you want to wait until this particular committee and this particular fed chairman say all clear, there's not going to be a whole lot of money left on the table, so as investors we need to make decisions, what do you stick with and what do you try to move a little early and just this notion that the fed has no reason to try to talk less aggressive everything that happens in the future will be better for the fed if they remained tough no matter what inflation does, but that's not what investors should think. investors should look around and say everything that went crazy in the world between march 2020 and maybe right up until now and you look at the government and i want the government to negotiate my contract, and i think investors see inflation moderating in a much more aggressive fashion at some point than the foreseeable future and that's the gain.

steve? >> i don't disagree. the market has a point of view the mrasharket is expressing tht point of view with dollars and the market cuts a check based on the closing price and all of of that is accurate and the market will do what the market's going to do and it will balance all of that and i don't think he wanted to relax financial conditions and i guess what we found yesterday, they don't have much control over that. i do want to point out, 08 on the spending number, take on 03 on the inflation number. we did positive real 05 on spending and income was up -- i don't know that some heck of a recession we're having here, folks. it's craziness we're supposed to be down in the dumps by now or maybe it's coming next month, but i'm just having a hard time seeing this weakness by the consumer inflation did not come down. it came down more than we expected, why? because they revised up september. so i don't think powell is happy with a 5% year over year core

pce number >> rick, if the markets were always right we'd never have an opportunity to buy or sell one day it thinks something is worth this and some days it's worth a tenth of what it thought it was worth at the point of the trade, it's always correct and if it wasn't, the whole system would break down >> thank you, rick thank you, steve >> thank you >> from the bottom of my heart although -- are you going to stick around >> i'll listen >> mohamed el-erian next >> want to hear what he has to say. s eight minutes to qualify. i went on their website, uploaded everything, and i was blown away by what they could do. getrefunds.com has helped businesses get over a billion dollars and we can help your business too. qualify your business for a big refund in eight minutes.

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>> welcome back, everybody we just got a new read on the fed's preferred measure of inflation. core pce prices came in and they came in below expectations and we want to talk more about the new data and fed chair's jay powell's latest message to the markets which can pretty much be summed up with this. >> it will moderate the pace of the rate increases and it will be sufficient to bring inflation down the time for moderating the pace of rate increases may come as soon as the december meeting >> all right let's bring in mohamed el-erian and president of queens college cambridge and steve liesman was in the room listening to this happening. mohamed, i want to first walk through this pce number.

how much does it change the picture if at all? >> it just confirms two things if you take the data as a whole, one is that inflation is coming down and two is that the real economy continues to do well, so this will just feed a growing narrative in the marketplace which was given a major terrible charge by what the fed chair said yesterday the fed -- the market did not hear his balanced remarks and they were balanced they just heard four things in particular, and off we went to the races and we will continue to do so unless we have a strong employment number tomorrow. >> earlier this morning we were looking at the dow futures down. not by a lot and right now they're up triple digits and again, it's because of the softer than anticipated pce number and softer than anticipated inflation number and the markets are off to the races and not giving off the big gains

from yesterday is that the right move even if the fed is going to stay longer, and is this going to make the pivot in your positions? >> so it's important to just focus on what the markets heard. they heard what the clip you played which is as early as this month we're going to downshift in rate hikes. they noted that he said that before the employment report, they also heard him be much more balanced in terms of risk noting that there was a risk of overtightening, and when he got to that phrase, he said my colleagues and i, so he generalized it and then it's also about what he didn't say. he didn't push back against the loosening of financial conditions and we had a massive loosening of financial conditions and it is down over 40 basis points. so when you put all of that together, that is what the market has internalized and has completely ignored what else he

said >> i'm sorry, mohamed. i think you're reaching a critical, critical question here >> first of all, i want to point out, every single fed speaker and we've had 500 of them in the last week has been able to talk and not loosen financial conditions only powell did. only powell, in all the speeches, only powell will loosen financial conditions. do you think yesterday he meant to tell the market or the financial conditions and he did not mean to do that, did he mess up yesterday >> so i expect, but i don't know, steve. i suspect he did not mean to do so there are two issues that played out that speak to why his remarks were so consequential. one, it's him, and then people pay a lot more attention to him and something we've seen over and over again, when he sticks to the script he tends to give either a balanced or a slightly hawkish message.

when he's not sticking to the script and he starts answering questions he tends to go dove earn ish, and we started to do that yesterday. mohammed, have we moved into new territory, do you think? i love the s&p and we're at 4,080 now. we tested the lows and we had our bet and we got below 3600 and i don't know if we would call that a breach of the low and we thought 3200 or 3,000 and people still do on the s&p i'm wondering -- let's do the same exercise again. what's new now 4500 or 3500 given that maybe we're starting to see some positive signs about the fed and about, you know, whether they need to go that much further >> do you think it's 35 or 45? >> first, i'm not going to get into another bet with you.

>> joe namath. that means nothing to you? >> it meant a lot and it was a lot of fun, thank you, joe >> we got to 3500a on. >> go ahead. >> we got to 3500 because you had the coincidence of two things and you had interest rate risks and the multiple because of what was happening to financial conditions and liquidity and you had concerns about earnings and the first is going away i am in the camp that inflation will continue to go down i do think that by the middle of next year and what will you do if inflation is sticky at 3% to 4% do you climb the economy lower and the marketplace is saying inflation risk is over the market isn't focusing yet credit and earnings risk and that is because as steve rightly said, there's no sign of a

recession. >> so, then, 45 or 35? >> you don't have to bet >> joe, i don't like you putting me in these sort of barbell things, right? >> are you feeling better that we maybe have made a bottom at this point a permanent bottom the dow is up 20% now, mohamed is that still a bear market rally or do we call it a bull? >> i'll repeat what i said over the last two or three times i've been on with you which is for now the coast is supportive of risk assets going higher if you look beyond the next few days and weeks, there are some great uncertainties and we are yet to get enough information one way or the other so i can -- this market is a market that's very attractive to tactical players it's much tougher to long term -- for long term investors.

>> recession or not, mohamed >> look, i'm not in the camp of 100% recession i think the risk is uncomfortably high, but we can avoid it, but steve, i always quickly add, if however we fall into recession which i hope we don't, don't fall into the trap of saying it will be short and shallow because if we do fall into a recession there is a high risk that it will not be short and shallow. so keep an open mind and let's not repeat the risk of last year when we all embraced transitory inflation because we can look to it. >> is that because the fed and the fiscal side won't come in to help the economy at that point because of the inflation danger. >> yes and also because balance sheets may be strong overall and there's a good segment of the population that are hurting and also, there's lots of stuff going on globally. supply issues aren't going to disappear and i had yesterday's

financial times that goes through why i should be open-minded and humble about what a recession would look like because there are simply too many uncertainties right now >> all right, mohamed, how do you feel overall are you feeling better about things >> looks good. i like the hair. >> i'm feeling better for now, but i have concern about what we'll look like next year and we have to be cautious. we'll learn a lot in the next few weeks. >> are you willing to admit a big mistake you made with zack wilson >> joe, i haven't recovered from the last of the patriots last week was good, but not good enough >> the backup quarterback. >> i thought about that, that last-minute -- i thought about you as it was happening the punt return. >> it was devastating, joe absolutely devastating you have no idea

>> he doesn't care whether the jets win. >> all jets fans >> i care a great deal if the jets win >> mohamed, thank you. we'll see you soon thank you, becky >> pleasure on. >> when we come back, jim cramer's first take on the trading day ahead and a programming note, don't miss chevron's ceo mike wirth and he's joining us at 7:00 a.m. eastern time and i'll be speaking to him today at the economic club in new york and that is at noon and i'll have an extended conversation with him tomorrow don't go anywhere. "squawk box" will be right back. or an important event for their family. for them, it's the first and only time. we have seen this literally thousands of times, in thousands of iterations. ♪ ♪ i am vince lumia, head of field management at morgan stanley. whether that's retirement, paying for their children's college education, or their son or daughter getting married, our financial advisors need to make sure

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want to get down to the new york stock exchange where our good friend, jim cramer, joins us now jim, we're talking all morning, both about sam bankman-fried and jay powell, maybe not in the same sentence, or shouldn't be, but take a crack at each one >> well, one's just a total con artist disgusting makes me sick. the other guy did a good job i thought he told a good story it's kind of where i think most of the people are who watch us and i think that sam whatever -- don't even want to dignify his full name anymore -- is just a con artist, and as are many of the people who talk about crypto right now, i believe, coming on the show, but i thought that chairman powell understood that there's been a dramatic slowdown in the country in the last six weeks. everyone's pretty scared businesses don't want to spend, and the people are calling for 5

to 7% are people who squarely do want a recession i don't think jay powell wants a recession. >> here's the question we were talking to steve liesman just earlier, and he seemed to say, this is a xerox copy of what we had already heard from jay powell, that it's actually not new news, and that perhaps maybe the market's taking it as something it isn't what do you think of that? >> bullard said it was going to go to 5.7 and he basically took 5 5.7 off the table. bullard basically said, we can't stop inflation without a severe recession, and i think powell said, look, we may have to go somewhere, but we're going to do it slowly. i think jay powell is very concerned and very worried that people have totally stopped hiring the consumer is squarely trading down, pretty much everywhere >> that's what andy jassy told us yesterday >> negativity. >> yep >> negativity there was unbelievable how great your day was yesterday. i came back shaking.

shaking from him and then the con artist was just wild he's fabulous. >> comingled, stole, but he was sorry. he was sorry >> we will see >> you said earlier, sorry he got caught >> stealing means never having to say you're sorry. i don't care about alleged anymore. i'm dropping the alleged nonsense i'm not being a journalist anymore when it comes to that guy. i'm not being alleged. >> jim cramer taking the gloves b iikpollngis morni >>ut le we >> thanks, jim bye. we're coming back after this

little more than half an hour until the opening bell on wall street. let's talk more about the markets with cameron dawson from new edge wealth. did you become more bullish yesterday? you haven't been that bullish, i don't think. >> i think as the market continues to trade higher, the risk-award becomes increasingly unattractive, meaning, if we look at valuations trading at nearly 19 times what we think a reasonable number for earnings of next year or earnings still needing to come down for next

year, i think it gets a little bit more treacherous the more we trade higher now, from a technical perspective, could we trade higher i think it's very possible, simply because if we continue to push above that 200-day moving average, you'd see a lot of performance chasing. but that's not something that we really want to chase, and we don't think that much changed in powell's language yesterday. it was simply a reiteration of the message that he has been saying the good news that happened is he was simply just not more hawkish than he has been >> what does that mean for what you do on a daily basis, cameron? just look for better companies that will -- stocks that will do better and haven't run up as much or you're not investing new money, you're going to wait until there's a pullback what does it mean about whether this is a bear market rally or a new bull >> well, to answer the last question, it is possible to be in a bear market and trade above the 200-day moving average

it doesn't happen very often it is rare but it is possible so, we have to consider that there is a possibility that we re-enter the down trend. but as far as what we do, i think that the message here is that we have to be very valuation disciplined right now, because as we've seen this rally all quarter, it's all been driven by multiple expansion, and that really is because of this expectation of a less tight fed, and so if we see growth continue to come in better than expected, which we have been seeing better growth statistics, that could put upward pressure on yield, put downward pressure on valuations, so when we look for new areas to buy, we want to make sure we're buying in valuations that still remain reasonable instead of chasing valuations that might have already recovered back to prior highs. >> so we're in a trading range, would you say? doesn't mean we hit new lows or new highs. is that where we are for how long >> i think that's exactly where we are

i think that the reality is that we're going to be in kind of this sideways directionalist trend for some time simply because we have to essentially grow into the valuations where we entered this bear market. we started this bear market at 22 times earnings. that's really only justifiable in a world where the fed is being very easy, very accommodative. so, what that means is that in order to get back up to prior highs and start into a new bull market past those prior highs, we really have to see it come from earnings growth we have to grow into those high valuations so, the trading range is really capped by valuation itself, and at 19 times nearly today, that's where we start to say that the risk-award becomes less attractive over the medium term. >> cameron, thank you. good to have your views this morning. put them in the blender and try to figure something out.

i don't know >> we're trying to figure it out. >> bull market, bear market, rally. you know when we'll know like a year. i guess. maybe not even by then >> will we when will we know? i don't know >> final check on the market i know tomorrow's friday final check on the markets we're now positive we're now positive some of those numbers that came out at 8:30 were okay. jobs friday. make sure you join us. "squawk on the street" is next ♪ good thursday morning, welcome to "squawk on the street," i'm david faber along with jim cramer live from the new york stock exchange. carl has the morning off let's give you a look at futures, get started with trading here 30 minutes from now, and as joe told you, we're looking up on the markets after we got some data about a half hour ago, turned things around a bit. let's get to our road map. we're going start with earnings that show some cloud computing gloom. salesforce and snowflake both bein