christmas, sarat i found the phil connors quote, basking in the warmth of their heart and hearths of your family that's what we're going to do. >> perfect >> and not worry about -- >> the markets, about anything else >> i'm quoting a faux weatherman in a crazy movie but it is touching >> great movie >> touching, and everybody have a great christmas, great holiday. and great new year, hopefully. >> bye-bye see you on tuesday happy holidays, everybody, merry christmas. we'll see you next week. right now, it's time for "squawk on the street. ♪ good friday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer at the new york stock exchange david faber has the morning off. final blast of data before the holiday. weekend futures are green, as durables come in light core pce roughly in line, maybe a tenth heavy year on year personal spending, lightest since july our road map begins with tesla, shares on track to claw back

some losses at the open. still heading for the worst month ever plus, recession fears dimming hopes for a year-end rally, and it's been called a once-in-a-generation storm, fedex warning of delayed deliveries and obviously thousands of flights canceled. we're going to begin, though, with elon musk vowing to pause sales of tesla stock during a twitter spaces chat yesterday. musk said, "you can count on me. no stock sales until, like, probably 2025 or something you know, i need to sort of sell some stock to make sure there's some powder dry to account for a worst case scenario, but i'm not selling any, so i obviously have my commitment. i won't sell stock, probably, until two years from now." jim, that comes after the stock down 22% in five days. >> you know, look, i think that when you think about esla, you have to remember, this was the stock that was $839 billion. all-time high here, wow,

$1.2 trillion. now, the problem with that, carl, is that is really money by retail of course, it was added to the s&p, but the $1.2 trillion, it was probably, i think, for this era, the greatest of the -- this era's over, okay this era ended but this was -- and it wasn't a con, by any means. it was the greatest excitement i've ever seen, and the excitement is over, and i don't think his statement creates new excitement i think his statement is just, like, okay, listen, i know that the horse is out of the barn, but i am going to stop maybe some people will want to rebuild, but next year, there's a lot of competition look, i'm not going to say tesla's done because it's too good a company. i'm saying the enthusiasm is done, and maybe that's good. there's a lot of stocks where we got way too enthusiastic, and that's what's happened

so, i think retail, in many ways, has been crushed look, nvidia is one of my favorite stocks. that was at $798 billion that's just crazy. it was at $798 billion, and now it's substantially lower you got it cut in half i mean, jesus, tesla, can you believe? tesla's $1.2 trillion and went down to $395 billion >> do a year to date bitcoin versus tesla the declines are about the same for 2022 >> these declines, you know, amazon, 55, alphabet, 42, meta, 69, microsoft, only 31 only can you imagine? nvidia, 55 tesla, 69. that's the end of retail that's the end of retail as we know it. it's the second time within 13 years that retail has been blown out, and they're not coming back and so, it doesn't matter. he can say whatever he wants it's like adam aron can say whatever he wants. it doesn't matter. ryan cohen can say whatever he wants. the enthusiasm is over

and when you talk about the stock market now with people, they very quickly change the conversation to anything but the stock market sports, politics >> well, look at what bank of america said this morning about weekly outflows. new records on that front. but does tesla -- we talked about this with mark fields yesterday on closing bell. does it command a premium because of its supply chain agility, lack of a dealer network, no advertising? >> yes, but premium to what? that's the problem i mean, to ford? >> exactly >> yeah, i mean, ford is going to have 50,000 evs they have some really good evs, i think, by this time next year rolling out, and that means that for the first time, you're going to have to see, i believe, advertising for tesla. i think they have to advertise they've got -- got to have a 66% share, and if you really have heavy ford and gm ev in scale,

then tesla's going to have to have a more expensive business model, and i think that's what's going to happen. i don't know, carl i just am looking at the twilight, the peak twilight of fat man. that's what we call it fat man. facebook, amazon >> well, if tesla were to have a multiple in line with ford's, i think i have this right, it would take it to 16 bucks. you're not calling for that. >> no, no, no. i'm just saying -- what i'm saying is that a stock that's at $395 billion, it could go to $295 billion i mean, that's what happened like, stocks became, well, whatever people wanted them to be, and you'll have a cathie wood saying, that's what this is then you'll have another person saying, that's what i mean, dan ives, i mean, there's no rigor there's no rigor to anything they're just, like, hm, tesla, let me -- feels like 360 i mean, honestly we were taught -- i was taught

by lee cooperman that there had to be a reason why something sold where it sold this was the year where it's -- that wasn't true and so, i mean, mark zuckerberg, okay, presided over one of the greatest downfalls of a stock ever and you -- the only thing he did was, like, play in the metaverse. i mean, no one came on -- adam aron did not come on and say, hey, listen -- he did say, i'm going to sell, but he did not come on and say, buy the a.p.e.s yesterday where you get a 50% move ryan cohen never came on these people are all totally legit, but the people cost themselves money i am not saying that they could -- they didn't do anything other than what most ceos do they were salespeople for their people tim cook is not a sales person for his company. if you bought that stock because you love the product, whatever, but these other ones, i mean, i don't know the people got too enthusiastic. >> right

i'm glad you mentioned wedbush ives does cut his target to 175. he was at 250. deliveries now, we're starting to talk about q4, he's in the 410 to 415 range street is 4.35 >> i think that's right. look, i think that -- i mean, i hesitate to say it, but in some ways, we were valueless. i was valueless in the sense that, i sold a lot of these stocks i sold every one of them near the high i kept some on i'm just saying that we lost control over how to value these particular stocks. we just didn't know. and because we didn't know, we had a 2000-2001 scenario going, and i'm just afraid that we lost these people i did meet some people who were in college, and they have investment clubs, so there's an era of people who want to do it, but most -- this is just another thing that says, okay, just give me an index fund and i think that's a shame, because i like stock picking, but i can't -- this is for

tonight's show i look at these peak-trough, and i just think, oh my. microsoft, 2.5 down to 1.7 >> i'm not -- i'm waiting for, there's a bull market somewhere. >> there is. there is a bull -- in companies that make things and do stuff, that are sell -- reasonable values that return capital those -- that's it they all work. i would buy caterpillar right here, right now. i would buy deere. they make things they do stuff. they sell at reasonable multiples and return capital while being profitable >> what about the argument that those types of stocks better start making a relative move up to the upside against things like staples, smuckers last night. >> great turn around company i don't know if we have tape >> i think we do >> mark smucker is fantastic >> mark smucker with jim, do we have it racked this is what you talked about cost inflation last night. take a listen.

>> we actually have had to very prudently pass along, you know, cost inflation to our customers and our consumers, and we're careful about doing that, but we've been able to do that while still having a very systematic and creative marketing that we put against the brands, which have really connected them to consumers. >> no trade down good brands. jellies. milkbone really good dog food one of my absolute favorite coffees. no tradedown the people will pay for those brands, and that has -- that is what's confounded -- it's confounded powell, confounded the fed. we're supposed to trade down with from those, but i don't know how much jay shops at dollar general, but it ain't at dollar store. every row is just filled with dollar things. many expensive things. things are not cheap

when a dollar store has stuff that's nowhere near a dollar, forget it. we do have inflation we have a terrific man who's turned that company around they're charging what they want. i do think that once you start seeing the federal dollars come through, you'll see cat go up substantially and deere go up substantially. >> you mean infrastructure spend something. >> it's going to be huge >> what do you make of the "journal" piece this morning that supply chains are officially back to normal? what does that do to companies like smuckers who want to use supply chain as a rationalization? >> what will happen is that costco, which is the great arbiter of cost in this country, will be calling mark and saying, you know what? uh-uh. no you see, you raised your price now now your your price. for instance, here's something avocados >> are you -- yeah mission produce. this was good last night >> avocados. they're down so huge now, will chipotle cut its price? we all want to know.

because avocados, that shows you the decolonline that we can get if the justice department were to go after the shippers that all seem to bring the fruit from south america, that would be interesting. all i'm saying is that we -- that costco is now on a mission to get prices lower, and they will succeed >> yeah. if you want to put the ticker up, it's avo jim's point about avocados we saw avocado inflation up 40, 50% earlier in the year, now down double digits >> not a lot of people reducing the price of avocados. until someone breaks price and you hear, hey, you ought to go to this place, they've got avocado much cheaper but what i'm saying, carl, is that this was a failed year for pretty much everybody. to try to make money, unless you did smucker, i don't call them needles in hey haystacks i'm saying there were a lot of good stocks, but they weren't

where you looked, and they particularly were not in the nasdaq, and this whole enterprise software fiasco is incredible it wasn't in ipos where you have all the warby parker syndrome where you heard the brand, so you bought the stock again, totally failed strategy the only strategy at work was to buy really boring companies that make things, do stuff, return capital, trade at a reasonable value. that's it. >> yeah. >> that turned out to be not that many companies. >> but you would agree that covid and the response to covid threw all kinds of playbooks out the window there was no way to understand >> everything. and i think that people refuse -- f.a.n.g. was covid f.a.n.g. was advertising f.a.n.g. was staying at home i mean, advertising just vanished for these guys. and you know, for f.a.n.g., f.a.n.g. was fantastic, for facebook and then apple changed the code i mean, apple -- people bought too many apples but they they can't even make enough apples. netflix had the advantage of falling first and then once covid ended, they could make a

lot of new things. >> it reminds me, we've been watching china and these reports that maybe 18% of the population was infected in the first 20 days of december >> what's the r naught of that 18%, and you have 1.4 billion. i mean, in three weeks >> but your point is that they have to blow through this one way or another >> but when they blow through, wow. that will be the first real good news for the economy, but will that just make powell's job even harder i mean, this tepper interview, i went over the tepper interview really closely, that they had yesterday on "squawk," and he really just said, look, it's just not the right time to like stocks he didn't say he hates all stocks we're in a denouement period really, it's a shame when you talk to people about tesla, it's the car, not the stock. >> i heard you talking with joe prior to the top of the hour

about yesterday's recovery, i guess, can we call it that >> look, i talked to larry williams, who is the best market historian i know, and he said, the santa claus rally starts on -- traditionally on thursday, on that day, in the middle of the day is when you buy. so far, so good. but what happens, there was a little gun jumping people bought on wednesday and lost a lot of money. but i don't think anything can hold up here we don't have -- none of those numbers that we got this morning shocked us, saying, wow. i mean, yeah, maybe the durable goods, wow, that durable goods number is weak but this isn't what we want. >> yeah. i mean, headline pce year on year is 5.5. last month, it was 6.1 we keep putting declines like that together, maybe the spring looks different. you don't seem convinced >> i just don't think it's a good time. i think you got to find those companies that make -- since november, with november of last year, everything changed but the retail investor did not

know it changed. and that's why i say, like, disservice, no i mean, mike wilson. mike wilson really did get it right. calm guy, honest guy you know, november, he said things would get bad he then ticked a little bit up and then came back down. i applaud him. if you listen to him, he saved a lot of money >> the double-breaking putt. >> do you know him >> i'm just on television. >> good enough guy >> well, that doesn't portend good things about q1, if we're listening to wilson. >> i can't go against a guy who's been right all the time. i can't. tepper's right mike wilson's been right >> when we come back this morning, sam bankman-fried under house arrest this morning after being released on that $250 million bond. take a look at the premarket as jim said, we got some day-to-day 30. more on the way at 10:00 with the new homes, oil rig count later on today there's still a lot headed our way before the weekend don't go anywhere.

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ftx founder sam bankman-fried has been released on $250 million bond after a federal court appearance yesterday while he awaits trial on charges related to the collapse of his crypto exchange. terms set by the judge call for bankman-fried to remain under house arrest at his parents' home in palo alto, california, which has been pledged as security on the bond, plus surrender his passport, wear a monitoring device. his next hearing set for january

3. jim, the judge's rationalization was that he has sufficient notoriety, meaning it would be difficult for him to either engage in further schemes or hide >> yeah, i thought that was reasonable i mean, i think that was big -- obviously, biggest bail ever to go with his parents, though i mean, we don't know what role they played. we don't know what role the -- ms. ellison's parents played we don't know anything one of the reasons why i'm upset and i think the s.e.c. should be more over these things, when we look at a filing of a stock, we know who owns it we don't know what this guy owns i know that, again, the faith of the american people shocked. just shocked i mean, i still think that -- i think that crypto -- i mean, i sold -- i announced everything on tv, what i did with crypto. but i would not touch crypto in a million years. because i wouldn't trust the deposit bank >> and you're making no distinction between centralized,

decentralized -- >> they fought regulation. they didn't want regulation. and you don't have regulation. so, if you have your money in any of those, look, i'm not calling you an idiot i'm just saying you're using a lot of blind faith, and i like to have my money at jpmorgan, and i check on monday to see whether my balance is there. it feels good. try getting your money out i had -- i'm not going to mention the firm that i had my money in, but it was a fight to get the money out. a fight. and i think that everybody who owns these various coins, you know, solana, light coin, i think you're -- i do think you're an idiot, okay? i did not go to college to get stupid these people who own these things should not own them they shouldn't own them. >> well, and now we got gensler talking to "the times," arguing that the existing laws may be sufficient even though a lot of these guys -- >> i said -- i said, why don't you come on and enforce them

i think they need to do a big sweep. they have to stop having people creating money, carl it's the creation of money by cretins. i don't think cretins should create money and then suck people in. these are worse than even the worst nasdaq stocks, and yet there we are we've got them up there. lightcoin. how about dark coin? solana i don't know how about selena doesn't matter >> one interesting tidbit from "the times" today is that ellison and wang entered their guilty pleas on monday but they didn't docket it because they didn't want to tip him off before getting him back in the country. >> they turned pretty quick. they're friends. i mean, i get -- they just flipped. >> yep >> i mean, they flipped so quickly. and we're not done there's going to be a big sweep of all these firms, because these firms are, in many ways, tied in with each other to keep the price up and i know that, and so does the s.e.c. and they owe us a sweep. >> we're going to find out, obviously, more on the 3rd when we see him back in court

cramer's "mad dash" coming up, and the opening bell take a look at the premarket ahead of the final trading day of the week. dow actually still on pace for a weekly advance back in a minute ♪♪ ♪♪ ♪♪ be ready for any market with a liquid etf. get in and out with dia.

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and responsible investing. let's get cramer's "mad dash" as we count down to the opening bell today >> there's been a big acquisition, directv, and the analysts, i think, don't know really how to cover it they're all kind of mixed about it great deutsche bank piece still saying, they don't know. they struggle to identify a clear path for the deal to be immediately economically beneficial they're missing on two things. one, it's going to jump start youtube visibility but second, they don't intend to be static. right now, directv is static turn on channel 707, and you get that game. they want to be interactive. they want to make it so that there could be things like what eli does >> the manning cast. >> and get people to focus on a full panoply of things maybe gambling built in. maybe the possibility of fantasy built in

surge pricing, even, for things that go on in the fourth quarter, for when you need to really do things you know, your players are playing, and to isolate your players for fantasy. they get it. they get that directv was fallow, and i think they'll do great things, and i believe that we will look back and say this was the turning point for this company. >> what do you think it does to time spent on roblox, snap, tiktok, reels? even, you know, netflix, the big streamers, do you think it moves the needle on some of those to the downside >> during the season, i think that you have 55 million people who play the game of fantasy i think that will go up. the roblox numbers are very discouraging the snap numbers are discouraging i think we'll find the instagram numbers are okay, that the reel numbers are okay but that alphabet is trying to change its stripes >> so, you think maybe net positive for the draft kings and

the pens >> if draft kings does the deal with alphabet, you buy draft kings. you buy draft kings now. the problem now is that you got to predict what alphabet will do, but i'm saying that if anyone thinks that alphabet is just going to slot it in like the dumb way that directv is, forget it. they have a very big plan. big plans about what to do and do not dismiss their plans they know they have to jump start youtube, but they also have to use all the great interactivity they have. there's much smarter than people realize. this is going to be a very big thing. >> yeah. we've been talking about it for so long, and we finally have the answer of who the bride is >> i was very surprised that amazon didn't do it in light of the high quality of thursday night football >> here's the opening bell cnbc realtime exchange, schwab asset management celebrating income-oriented schwab etfs at the nasdaq the u.s. postal service celebrating operation santa and there's a lot of delivery news today, jim, given the storm.

>> fedex, i mean, some of this stuff is discouraging, but look, fedex is a great outfit. they'll do what they can u.p.s. used to have that problem. i'm not hearing carol saying -- coming out and saying anything that's -- that they can't -- fedex is up. look, i thought that fedex acquitted itself very well and it's not going to trade off santa. it's going to trade off the fact that they're no longer willing to do things where they don't make money and i wonder whether it will affect their worldwide root structure, because they are willing -- you can send anything anywhere with them i'm not so sure they're going to do that. i think they may find places where it's just not economical, and they'll pull back. >> interesting fedex, if you missed it, did say some holiday packages could be delayed, interruptions at the memphis and indy hub due to severe winter weather, but also jim, reports of doordash, deliveries getting interrupted obviously, the airlines, 4,000 flights canceled >> again, you know, these are suboptimal, and the airlines had just been trying to make a

comeback, and they will be more problematic. the whole -- that whole elite group of the doordashs and the airbnbs and the ubers, lyft, they're all under tremendous pressure they're also part of the mockery of the sham of the retail investor, and i know i believed -- i believe in airbnb, but the prices are coming back to where we thought they'd be before the pandemic. before things got really exciting >> right >> and i think it's very hard for the individual investor to adjust to the losses i think they'll change behavior, because the losses i think that powell should recognize that he's winning in one area, which is the declines in the stock market. >> so, you would not be -- you wouldn't be going into the new year with a fresh long on airbnb >> i like it i think airbnb -- when i talked to brian chesky, brian chesky was on my show, the ceo of airbnb, and he said nothing about how the high end was not

traveling. and somehow, his interview was interpreted as saying that i went back to brian, and he said, that's just not true just don't -- it's just not a fair analysis. so, i do believe in airbnb i actually would own the stock of airbnb. i do not own it for my trust, but i think that it's a good company. i think brian's done a lot of good things. >> we've mentioned, obviously, with google and directv or the sunday ticket, implications on gaming and time spent on social media. microsoft responding, giving a rebuttal to that ftc lawsuit about act viivision. >> good luck i was reading a "harvard law review" piece, and it just doesn't want deals anyone who's read the -- if you've read the report by the judge on the simon schuster random house, you'd realize they

are finding reasons to block deals. people who have not written books yet might find that they will not, when they go with their agent, get as good a deal as before. well, people who might write for gaming for microsoft will not be able to get as good a deal, because they'll be -- won't be able to -- what the judges are saying and the agents are saying is, you can't play off big companies to get better, right people have to read the reports. they're very boring. they repeat themselves over and over again, but the essence of all the antitrust by jonathan kanter and justice department and ftc is, we are making it so that as long as we have companies competing against each other, we will have more creativity in this country that's why i think that the l-3 harris air jet, i mean, they should read these -- well, i'm sure they've read the reports, but their lawyers -- if their lawyers are advising them that these deals can go through without being sued, they're being ill advised, because

these -- both agencies, ftc and justice, and the courts so far, say all these things make it so there's less creativity, less people discovering things, less armaments in this case, i think it will be speaking of armaments, did you know that aero environment makes the best drones? david would say, jim, where are you going here but they've got a fraction of the orders they could have when you read that there's so much going to ukraine a fraction of the switchblades that are very lethal toward the russians are being sent there. they're not being bought >> that's interesting. >> their numbers aren't that good because they figured that the u.s. government was going to buy a lot of this product. they're buying a quarter of what they could buy, and people who are in favor of ukraine should tell their, you know, tell people, look, there are weapons that are -- that could be bought, but they do have a further distance than the javelin. a 90-kilometer distance could

mean, again, our government takes itself -- the guys around the war, so afraid of missiles that could go and hit russia but anyway, i just think that these -- but the combinations aren't working and this -- it is incredible, they're not being given the go ahead. >> do you give the street credit for that arb spread, basically signaling what we've run into now? >> yes these people are hiding in plain sight. you just -- when you read the report -- when you read the opinions of the judges, and when you read the plaintiffs, the government blocking them, it's always the same, which is that there's been way too many deals in this country. the deals have been anti-the consumer, anti-the person who's going to write a book, anti-the person who's going to write a game, and it's very persuasive if you get the -- get a democrat judge. >> i wonder if that's behind some of these headlines, for example, hpe, according to deal

reporter >> that one breaking down. that's smart i think that there's a disbelief that these people in the government are going to succeed in these lawsuits, and i think it's -- their gravely wrong. the lawsuits are going to be horrendous and they're going to have gravitas, because we have a government that's very anti-merger. >> yeah. nutanix down almost 11% this morning. clicker ntnx oil is another story supply worries once again. russia warns it might cut production 7% to combat the price cap. we've got back to close to $80 this morning >> yeah, and rusty is my expert. he just said, look, a recession is what drives things down if you don't have a recession, the natural progression is for it to go higher, $90 a recession takes it down. but if we don't have that, and china starts -- but there is a great misperception in china there's a perception that they would use two million barrels

more if they really opened it's two million gallons more, so it's not as important but a recession is going to determine the price of oil, and oil goes higher if we stay out of recession >> yeah. there was a good piece about china's use of oil that they don't use a barrel of oil the same way that we do. and that if they reopen, yeah, it might be net bullish, but not to the degree some say >> exactly actually, our country -- if our country's economy is strong, it's going up a lot. natural gas, coming down >> nat gas, worst week since 2014 >> i know. all wrong. most of the prognosticators of these things have been completely wrong but i do think that when i look at oil, i think it goes higher and it's not just because they're filling the spr back because the president doesn't believe that the spr, petroleum reserve, has to be filled like it used to because we have so much oil in shale here the oil in shale has to be drilled constantly

the oil that russia has is deep water oil, and that can last a long time, and they don't need the technology that people keep saying they need, because they have long-lived assets they don't have -- they don't need american technology right now. >> we had brian, national council director yesterday, and we asked, have you gotten any expressions of interest on that bid? and he said, they'll have more to say in the coming days. >> i hope so >> yeah. >> i wish that they would sit down with the oil people i know that that's not something they care for. look at tesla down this is the same theme i'm coming with. you just -- the people feel they've been had, and it's, to some degree, their own fault they believed in the leaders of these companies, not unlike me i still believe in tim cook. i don't think the quarter's good, because costco told you they don't have enough supply. but the people believed in these companies. they believed in the ceos. the ceos were great salesmen

the ceos did what they did, and they got believers i blame, to some degree, i blame the people >> well, elon musk would blame the fed. i mean, that's his big argument, is that there's huge macro headwinds at play here in his words, i think, if i wrote this down, "there's stormy weather ahead, but there will be sunshine thereafter. >> he's a weatherman terrific does a plot of jobs. no, i mean, look, his sales mattered, but ford's sales will matter ford mock-e and the f-150 will be real competition for the first time by a real company, and i've been in the gm -- she has many more name plates, mary barr, but those are very good. but i think the ford electric 150 is a tremendous buy, and they sell every one they can make >> that's the big question, isn't it what happens to the argument that tesla is the alpha dog on supply chain, on production, even talked about picking a new

city for another giga factory. >> ford's ready to take them on. >> you think they'll be more aggressive >> yeah, i think that farley -- farley's out to get musk now, he doesn't -- just part of the equation farley is very competitive and he is tired of hearing how second rate ford is to musk. he's had it. and he has capabilities. now, he has internal combustion engine what do you do with all those people if it switches? that's not my problem, it's his problem, but i think that ford's been a terrible stock, in part because they're switching. and it's difficult to switch but when they get it right -- >> that's a heck of a chart right there. and i only say that because i always think back to the period where tesla was valued more than any other oem put together >> that was a great time great time for retail investors. but that time ended. it's not a great time for retail investors. i'm sorry. i'm saying the retail investor,

i don't blame him. that's what i'm saying i'm saying, i don't blame him. >> for losing interest, you mean >> right i don't blame you for losing interest it was a great ride. you did terrifically if you bought the stock of something you liked and used, that was a great way to do it for a while. i like etsy. i think 130, no. but i like etsy. i like uber, but 25? no i mean, these prices still have nothing to do with the -- with what the companies do, because they don't make money. >> right >> got to make money that's key >> and so -- >> how did that ever get to be key? >> you're not calling for -- you're not making a call as to whether or not tesla goes into the double digits at this point? >> no. won't do that. etsy won't, because etsy's going to make three bucks. tesla's very profitable. it's just that we have to try to relate the profitability to what the stock sells at, and i just think that people don't even want -- 30 times earnings was

considered to be inexpensive, and now 30 times earnings is expensive. and that's what i think the problem is wi r we reached a level where not only does it have to make money and return capital, but it's gotten to inexpensive. it has to be like pcg. inexpensive. big utility. sells at a fraction of what it should that could offer dividend. >> well, if you're watching smucker and utilities, then that kind of tells you what you're doing. >> i think campbell's is a terrific stock i mean, great. i thought so last night, it's an interesting company. will you look at that? kellogg. that is terrific by the way, general mills, whoever sold general mills, you're going to have to go buy it back. see zoetis

because they have livestock. needles in a hay ststack? no, it's a haystack filled with needles. look, i think that enterprise software, when you do meet a private equity person and say, what do you work on? oh, enterprise software. now you laugh to the them. before it was like, wow, you could be the man >> i'm just thinking back to the last couple months where we did see a wave of upgrades for service now in hopes that maybe these lead cycle times were coming down. you know, obviously, year-end scrutiny on deals, but hopes for '23. >> well, sells at 51 times earnings, so it didn't work. as much as i like service now, it didn't work i just -- if it sells at a high pe, we're back in the world where pes matter and if it has a high pe, and it doesn't return capital, carl, it's probably going to go down >> aren't you looking for some kind of mean reversion next year, though say, for example, worst dow laggards, crm maybe? disney >> we have to get -- wow, disney haven't talked about that in

forever. but we have to get what tepper wants. we have to get wages down. we have to get economy cooled off. we have to get rates to come down and then yes, it's paradise but those things have to happen first. >> sure. >> i mean, tepper was really instructive yesterday. if you didn't -- if you felt bullish, tepper made you feel less bullish, and he was very smart by just saying, look, it's just not -- it's just not a great time you have every central bank. marty says the same thing. don't fight the feds >> the feds. plural >> i want to recommend everything disney disney, even cut in half, has a new ceo. i own it for the trust i bought some -- just bought some i have tremendous faith in bob iger but nobody cares >> jim, before we get to bob pisani, i want to take a moment to thank peter, one of our control room producers, who's responsible for digesting every bit of breaking news that happens, getting it on our screen as quickly as possible,

feeding us some of the data that help us understand these markets. retiring and man, is peter going to be missed >> i worked with him at bloomberg, work with him here, and you get the email in the morning, puts everything in perspective, and i wish him the best of luck what a great guy >> yes cheers, peter. great to have you. let's get to bob pisani. dow is down 123. hey, bob >> and i'll echo that that with peter schacknow. when i got here in 1990 as the real estate correspondent, peter schacknow was a producer then. he is one of the great legends and one of the founders of cnbc and will be sorely missed and a dear friend of mine. sort of a mixed morning. lot of trouble figuring out how to interpret the pce futures just jumped all over the place as people have different interc inter interpretations of that. mixed market energy was a big winner, sort of this year. it's been stable in the last few

weeks. some of the other sectors, metal's a good proxy for global growth that's been up and down. let's call that sideways in the last month or so banks have had a terrible month, ever since the goldman-sachs financial services conference, been a bit more stable in the last couple of days, and of course, semis have been trending down the last two weeks and had a horrible day yesterday on the micron news. let's look at big cap tech nvidia is down today but there you see apple and meta and amazon down again today. you know, we're going to put up these end-of-the-year numbers to show you some of the big cap tech names, including tesla, which kind of gets jumped -- lumped into the tech category. and it's just breathtaking 65% for tesla. 65% decline for meta amd is down 60%. a lot of chip stocks are down 40% to 60% amazon's down 50%. so, the top 15 or so biggest cap names out there, and these are among them, have just had a horrendous year.

apple's only down 25%. that's considered a relative winner where we are right now as we move into the end of the year, it's just a lot of macro confusion, and you can see that today in the futures. growth is slowing but it's not slowing enough inflation is slowing, but it's still too high yields were trending down. now this week, they're trending higher so, what's the trend in yields it's not clear and earnings have been trending lower, but strategists think they're still too high, so look at this confusion. it's no wonder people have all sorts of estimates for how 2023 is going to be doing maybe we should just relax and have the santa claus rally and there it is. it's starting today, folks this is a famous old little wall street saw here. the last five trading days of the year it's good for an average gain of 1.3% by the way, that's statistically pretty valid that's a very good indicator doesn't happen like that normally, and it works 80% of the time, the santa claus rally is up, and the 20% it's down, that's when it gets interesting

because it's an indicator, and the point about the whole thing here for the stock traders almanac, it was discovered 50 years ago, is that failure to rally generally will precede bear markets or situations where you can buy stocks lower in the next year. so, the famous line here, if santa claus should fail to call, bears may come to broad and wall and that is yael hersch 70 years ago discovering the santa claus rally. let's relax a little for the next week and have a little eggnog and see if we can get that rally going carl, back to you. >> bob, thank you so much. bob pisani before we go to break, let's get a look at the bonds this morning. plenty of data for a friday before a three-day weekend we got new homes coming up in about ten minutes. we'll see what confidence and infl inflation expectations look like back in a moment

s&p laggards for the week. a reminder of what has not worked this week, namely some chips, some travel, but nothing worse than tesla extending its worst drawdown in history, worst quarter ever over a two-year stack worst decline than bitcoin on tesla. take a break and be back in a minute what if you were a major transit system with billions of passengers taking millions of trips every year? you aren't about to let any cyberattacks slow you down. so you partner with ibm to build a security architecture to keep your data, network, and applications protected. now you can tackle threats so they don't bring you to a grinding halt. and everyone's going places, including you.

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it's time for jim and "stop trading". >> it's pioneer, pxt here's a company that cut 10% yield baz scott sheffield says i want the highest yield sells 7 1/2 times earning. here we are, as we go higher, you know what you're going to get. that's what i want i just think that it's okay. ist not interesting. conoco is not interesting. eog is not interesting interesting is no longer a factor in 2023 one of the things i'm not going to look for is anything interest. >> ail though, there will be a

day when interesting gets interesting again. >> oh, my. when dave tepper comes on and says, they've gone too far then i know we can be interesting again. but right now, i'm just smack into the uninteresting category of things. except for drugs and food. i mean, milk bone, was so so hard to find milk bone was that so hard if you have a pet, you know. >> you get it. jim, see you tonight. >> have a great holiday. >> sh, merry christmas. when we come back, we'll stay on top of musk and tesla. now down 3%. 121 after musk vowed to pause selling. back in a minute it takes a village to support society and businesses have a responsibility to support that village. ♪ ♪ i am peter akwaboah, chief operating officer for technology, operations and firm resilience. when you think about diversity,

the employee network group is fundamental to any organization to provide a community and a belonging environment for the employees. they provide an avenue to support employees and ultimately it leads to retention of the best and brightest. the employee network represents the community at large, and it provides a good feedback loop to senior management to make the appropriate decisions, which ultimately contributes towards the bottom line. if you're thinking about growing your business, if you're thinking about driving the business forward, inclusion is a strong part of this. i am peter akwaboah and we are morgan stanley.

if you wanted to hold my hand... [ gasps ] all you had to do is ask. i am down to my last life. when you only have one life... that's what makes it special. go get 'em tiger. welcome back to "squawk on the street." rick santelli live at cme hq our university of michigan sentiment, this is a final december read, which means we take the mid-month and toss it mid-month of 59.1 gets replaced with 59.7. that's a much better number, of course that's the highest level since october. if we look at current conditions, 59.4, 59.4 replaces

60.2 that's a bit of a miss 59.9 on expectations replaces 58.4 so, two out of three are higher. current conditions, of course, suffered a bit that would make some sense now, if we look at the one-year inflation rate, which everybody wants to pay close attention to, that is running 4.4% 0.2 lighter. high water mark was in march at 5.4. five to ten-year inflation, 2.9, so 3%. now, for the mid-month read turns into 2.9%. high water mark was 3.1% that was the very first month of the year new home sales for the month of november, 640,000. seasonally adjusted annualized units. that's better than 600,000 we expected a subtle revision. last 632,000 for the previous month is downgraded to 605,000

that represents nearly a 6% increase at the 640,000 mark carl, back to you. happy hanukkah, merry christmas. >> same to you, rick thanks so much for everything you do our rick santelli. good friday morning. welcome to another hour of "squawk on the street. i'm caller quintcarl dow down 130. >> we're 30 minutes into the trading session. here are three big movers we're watching starting with nutanix. the stock is down almost -- stock is down 6% hp down a bit. plus, look at meta, agreeing to pay $725 million to settle a class-action lawsuit that claimed the company gave

third-party access to user data without their consent. the lawsuit was prompted in 2018 after facebook disclosed the information of 87 million users was improperly shared with cambridge analytica. crude oil is up 2% in early trading. the state of the consumer as we go into this long holiday weekend. a ton of data to unpack today. our senior economics reporter steve liesman joins us with what was important and what's most important to watch, steve. >> pack the data, unpack the data all day long. consumer spending slowly sharply in november. the question is whether they resumed it in december or if this is the beginning of a long-awaited consumer slowdown here's the income numbers. up 0.4%. that's not bad down from the 0.7% of october. spending declining sharply to 0.1% from 0.9% the modest gains saw a decided shift from goods purchased to

services the savings rate ticking back up but remaining pretty low, 2.4% versus 2. 2% sal guatieri says the flat volume in november still suggests a three-handle on q4 real consumer spending growth. but any forward momentum appears to have fizzled in the face of high inflation and rising interest rates with higher numbers dropping out of the readings from last year, year over year inflation readings for the pce inflation index did make some progress take a look here the headline 5.5%, 1.5 points. core about 70 basis points from the peak not making as much progress on the core both have a ways to go to get to the fed's 2% target but moving in the right direction goods prices show outright deflation now in four of the past five months

service inflation remains subbornly high that's the indicator jay powell said he's most looking at for guidance 65% probability of 50 basis point hike on february 1st >> i feel like we received a lot of incoming economic data this week it's like we've seen lately, a lot of mixed signals better revision for gdp, and i don't think the market liked that, but 1% drop in leading economic indicators, plus what you've got today what's the narrative >>. >> the narrative is growth has held up pretty strongly. you do have that 3.2 number from the third quarter. and i'm going to go back over the weekend, have the yuletide log going and do gdp forecast and wrap it up next week and i think we'll be in the 1.50% to

2% quarter that's not bad that's why i led with december that's the rubber match here the strong october christmas spending was brought on by all those goods came in early. the retailers had them on their shelves. they said, let's get rid of this stuff so they did some october discounting. i think what happened is things f fell off in november i expect a slowdown in momentum in the economy, but i'mnot expecting, at least in the first quarter, to go negative. >> we will see seems like every month is the most important number. we'll see what december brings steve liesman, thank you >> happy holidays. all spring global investment jacobson, thank you. i wonder what you make of this ongoing conversation about the difference between goods and shortstop services, how stubborn

services is and if powerful inflation is so stubborn. >> as you know, the u.s. economy is dominated by consumer spending that's what we need to look at looks to me like the economy will hold up in the first half consumers still have some excess savings. the leading -- the leads and lags of the yield curve signal are long enough that maybe it's the second half of the year where we should be looking for a recession or weakness. in the meantime, the market needs a lot of thingses to go right. the market is priced as if the fed is going to pivot back down to a neutral rate of 3% while at the same time earnings are going to hold up and those two things don't necessarily agree with each other or they wouldn't happen at the same time. for the market, a lot needs to go right obviously, the economy is front

and center there >> brian, you've written a lot about growth being on a precipice and sort of looking at what history tells us about equity performance when we do get a pause. i guess the question is whether that lives up to form or not. >> yeah, we'll have to see the way we've been looking at the data is we have to break this up into a couple of pieces. what happens just historically when the fed hikes and then they hold that is actually a fairly bullish indicator, that period between when they hold and even before the first cut in four out of the last five times the fed has had to do that, equity markets have been up anywhere from 6% to 12% within three months. it's also been good for bonds. let's fold in the recession risks, what's happened as far as if that is happening during a recession. historically the fed hikes and then a recession happens like well after the fact.

that's where it gets messier we're thinking about in the early 1980s you had the double dip recession period where the equity market corrected significantly and actually when the second leg of that double dip recession happened, equity markets did fairly well. it's not a perfect indicator we can never say something always happens or something never happens. sometimes it does. it seems like it might be rhyming with that idea of a double dip recession kind of scenario where the market has done a significant amount of repricing already. >> so you're buying stocks now >> i would have to say that it's more of a balanced portfolio that we are positive on equity, so overweight. buying them, yes we do have a positive outlook. it is a matter of the horizon here, though we have to get to that hold point first. i think that's going to be the key thing.

february 1st fmoc announcement, what's the messaging around that is the end nirear in terms of re hikes themselves or getting closer that to us is going to be a significant trigger for equity market rally if we get that signal from the fed they are on hold we are adding risk but i wouldn't say we're all in on it right now. >> if that is the strategy, if you want to think longer term and buy stocks, the other confusing thing is which sectors to buy if you want to buy what's been beaten down the most, it's tech, the nasdaq communication services these are the worst performing stocks this year sector is down 40% do you want to be there in the rebound or are we in a changing dynamic where those stocks won't outperform anymore because we are facing higher rates for longer >> i think we're in a secular change of dynamic. for 2023 i continue to take a

cautious profile the indicator that gentleman just mentioned, i've looked at the same thing going back seven years. 11 out of 16 times the fed has tightened for the last time, the markets have gone down i think the markets are declaring victory a little bit to early here. expecting rates to fall to neutral while earnings hold up i think either rates will stay up and earnings will hold up or earnings will fall, rates will fall i think the market can't have it both way, even though a lot of derating has taken place for next year, i think this is more about the alpha than the beta i think the markets are going to chop around. i think the 40 and the 60/40 is going to do what it's supposed to do. it's going to be a port in the storm if that port is needed for the equity side, i think beneath the surface, value may be small caps, which are trading at only 12 times earnings, and international equities, i think that's where the action is going to be. it's going to be in a more

muted, overall beta environment. it really is about that second order asset allocation rather than the first level >> that's a great point on -- well, both small caps and international. brian, i'm curious to know how you think the two big sort of binary external factors of europe and, by extension, ukraine, and china's reopening are going to play in 2023. >> so, we actually really like emerging markets in this type of environment. we have warmed up to europe. we think the expectations still need to come down a little bit there, mainly because of the lingering effects of the recession that they already are in i think maybe it hasn't been officially declared, they're effectively in a recession recessions start at peaks of economic activity. they don't start at troughs. recessions end at the trough i think we have seen the peak in activity there and we could see further rerating of the earnings expectations in europe in em, that's an area where

earnings expectations have already fallen effectively around 20% the street is really calling for effectively no growth in 2023 even maybe looking out as far as 2024 it kind of looks like that's where people have thrown in the towel, valuations have come down and china's reopening, it's not going to be just sort of a race higher when they go from covid zero to effectively covid 100, that's going to be a period of discomfort for a lot of people we think there's actually very good investment opportunities throughout not just china but the broader emerging market space. >> yeah. we're doing our best to understand how they're managing what appears to be a dramatic increase in infection rates over there. we're grateful to your time always happy holidays to you. >> you, too. >> happy holidays. recovering a little bit here off the lows down 49 on the dow some sectors turning green like industrials and utilities.

look at tesla, it's under pressure again elon musk saying he is not planning to sell any more of the stock until 2025 in twitter he said, i need to sell some stock to make sure there's some powder try to account for worst case scenario but i'm not selling any. i won't sell stock until probably two years from now. how much stock has he already sold the stock, by the way, is down 18% so far this year dom chu has been running all the numbers. what have you found? >> yes, ma'am, i have. if you take a look at tesla's stocks, we put it in context with how much value has been lost since the peaks in the early part of 2021 when tesla shares were way above where they are right now, we were talking about a total market capitalization of $1.25 trillion in terms of overall market value if you factor in the roughly 70% slide in the shares that we've seen since those highs, we now

have a market value closer to around $385 billion at this point. that's just how much market value has been lost. since elon musk announced he was going to go through with the acquisition to buy twitter, we've seen some significant underperformance in tesla shares as well. if you go back to the time frame, if you look at tesla shares with regard to its performance against the s&p 500 and as well as the nasdaq 100 overall, since around that april 25th mark, tesla shares have lost 64% of their value versus 10%, 11% for the s&p and roughly 19% for the overall invesco qqq trust. that gap has been fairly wide with regard to the underperformance the shares sales are where it becomes interesting. now, elon musk has said before about his plans to halt or pause selling of his shares, there have been four distinct batches so far in 2022 where he's actually sold stock. go back to april, roughly about 28 to 29 million shares of stock sold during that month period.

in august it was around 23.8 november, about 19.5 december, so far this month, around 41.5 million shares have sold that gives you a total of about 113.7 million shares so far in 2022 at then market prices, you say those 113.7 million, that gives you just about $24.5 billion worth of tesla stock that was sold by elon musk during the course of 2022 while we put some comments from the twitter spaces in context, there have been times throughout the course of the year he's sold and raised about $24.5 billion so far back over to you >> got it. dom chu, thank you though the selling today might have more to do with fundamentals, dan ives of wedbush warning about demand globally for tesla. sam bankman-fried released on $250 million bond, awaiting

trial for fraud and other criminal charges. this winter storm causing major disruptions. thousands of flight cancellations, fedex warning of delayed deliveries and billionaire investor will join us on what he's seeing for markets in the new year ahead as ntueawk on the street" coins. dow losses almost erased sor - to put the financial well-being of you and your family first. i promise to serve, not sell. i promise our relationship will be one of partnership and trust. i am a fiduciary, not just some of the time, but all of the time. charles schwab is proud to support the independent financial advisors who are passionately dedicated to helping people achieve their financial goals. visit findyourindependentadvisor.com

on $250 million bond after his first appearance in a new york

federal court. our kate rooney has the latest good morning. >> good morning. that is a record-breaking $250 million bond you mentioned sam bankman-fried is heading back to his parents' home in the bay area the former crypto ceo appeared in a manhattan courtroom after being extradited from the bahamas where he was running the ftx crypto exchanges he had to hand over his passport and stay within northern california and a few parts of new york he'll submit to mental health counseling and wear an electronic monitoring bracelet and needs government approval for any expenses above $1,000. the u.s. attorney called these alleged crimes a fraud of epic proportions and says this is the largest ever pretrial bond the judge also said says bankman-fried has gained sufficient notoriety, as he put it, it would be possible to engage in more financial crimes or flee, justifying the bail

there. bankman-fried's parents put up equity in their $4 million palo alto home to secure that bond and signed by at least one nonfamily member to put this in context, this bond is 25 times bigger than bernie madoff's while he awaited trial, the former enron ceo put up $5 million and elizabeth holmes of theranos with $500,000 and caroline ellison alameda and gary wang pleaded guilty to fraud charges. bankman-fried's next court trial is set for january 3rd we'll bring you the latest on that but never a dull moment here sara, back to you. >> oh, yes, kate rooney, stay close on those developing moments. let's keep the conversation going on what we can expect next former s.e.c. senior trial counsel howard fisher joins us

howard, it's good to have you. on that question of bail, a lot of talk as kate mentioned about how big it is, $250 million. she mentioned the parns put up equity in their home only worth $4 million just to be clear, does bankman-fried pay that money does that mean he lied when he told reporters, including our colleague, andrew ross sorkin, he was basically broke when he can afford a $250 million bail payment? >> it's a little unclear one of the things that's been reported is other people have come forward it's a little -- i haven't seen the bail papers. i'm a little unclear as to who put that money forward generally speaking, you don't have to put up the full amount you basically -- various people will pledge they'll be responsible for that amount if he doesn't show up at any hearing. as the judge point out, he is so notorious at this point that it would be very difficult for him to flee and to go anywhere where he wouldn't be recognized immediately.

>> why was it so big in comparison to bernie madoff or elizabeth holmes >> i think so there's a recognition, both in the judicial system and executive system, and with legislatures as well that the scope of the crypto crisis is huge. for a long time various elected officials have been advising that government regulators leave it alone, that they let the market develop, they let entrepreneurs develop whatever technologies and systems that the people would want in order to have this system developed. i think there's a recognition now that that was, perhaps, the wrong thing to do. if you leave off regulating something in which people are investing billions and billions of dollars, you're only asking for trouble later on down the line so i think the bail in this case reflects the increased

seriousness andattention being paid by all parts of government to crypto, crypto issues, the lack of regulation and the incredible harm a crypto collapse can cause not just investors but customers of the exchange as well. >> how do you square the urgency around regulation that ftx appears to have brought to the surface with gensler's comments in "the times. is this sort of part of the process and you don't need to lean on additional regulation to make the environment safer >> that's a great question it points to a fundamental issue, which is, are the systems and laws we have in place now sufficient to regulate the industry or do we need additional regulations and the s.e.c. has been incredibly aggressive in asserting it has the tools and a lot of coins being traded are, in fact, securities. in fact, if you look at the s.e.c. case against ellison,

they argue that the ftt, the proprietary coin that ftx used, was, in fact, a security this is part of a general trend the s.e.c. has taken in various cases in which they argue different kinds of coins, digital assets are, in fact, securities, they should be registered, regulated as such. if there's any kind of misconduct in the selling of these securities, that could be prosecuted as securities fraud >> so, the next court appearance is january 3rd he has not submitted a plea on these charges. what do you expect what is the chain of events from here the elizabeth holmes case took years. is that what's going to happen >> yeah. it's hard to say i mean, these cases can take a long time. and what the u.s. attorney said and has said consistently is they are looking for other people to come forward one of the things they've accomplished with the plea

bargains of ellison and wang is basically fire a shot over the bow of anybody else who is senior and deeply involved in the misconduct they identified that shot is telling those people, come forward now, we'll make some arrangement with you that's going to be a lot better than if you don't and we catch you and we bring you in against your will. so, i think what we're going to see in the immediate near future is other people coming forward, other people pleaing and then the next step of this is really up to sam bankman-fried. i would think that facing the kind of charges he's facing, he does have some incentive to try to reach a deal. on the other hand, i would have thought a rational person, once they're facing these charges, would have never talked to the media, would have never gone on various shows and put forward his part -- his side of the story. so, you know, it's very hard to tell what he's going to do

one of the things he may be considering is he may be effectively facing life in prison and given those incredible consequences for his conduct, he may think it's in his best interest to take a shot and go to trial. and if that's the case, this could be -- it could be a long time before we see the end of this >> he's argued, he's basically laid out his argument a number of times in these interviews that it was a series of managerial missteps and takes responsibility but stops short of fraud i wonder how tough of a case that will be for him, especially now that two lieutenants have pled guilty to a number of criminal charges >> this is essential in any kind of major prosecution, is that you need cooperators you need people who are at the top of the management to say, here's what we were doing. we knew it was wrong and when we were having these communications about it, we were trying to conceal it, trying to make sure people didn't find out what we were doing and we tried

to keep the misconduct going so it's going to be -- if ellison and wang come in and say, here is what we did and here are the documents to show we did this, here are the checks, here are the emails, it's going to be very difficult for bankman-fried to continue to assert his innocence if two of his top lieutenants are saying, no, it's not that at all >> howard, appreciate the perspective. very valuable. >> thanks for having me. >> the dow's gone positive. >> got green arrows on the dow and s&p. dow was already on pace for a positive week. still to come, one of the busiest travel weekends of the year but a major winter storm causing thousands of flight cancellations. me have a live report in a back in two.

a once in a generation storm hitting holiday travel airliners canceling thousands of flights as the national weather service calls for extreme caution. nbc news reporter katie beck joins us with more good morning >> reporter: good morning. yeah, we are watching these updates from airports across the country as this massive storm

starts to ground flights we have been made aware of several major cities, including washington, d.c., that are now under a ground stop. those include denver, memphis, seattle, portland. they are really starting to add up at this point again, here in washington, d.c., we are on a ground stop through about 11:00. some of the circumstances causing those could be anything from wind to rain to ice those wind gusts are pretty significant at this time this is the height of the storm for a lot of areas they're seeing those significant wind gusts play a part in this we know already between yesterday and today there have been 5,000 flights canceled. the bulk of those were out of chicago where there have been 500 cancellations just so far today. so, there are passengers, thousands of passengers right now who are trying to get to where they are going and are stuck in an airport somewhere. we know these are the two busiest travel days, as you said, of the holiday season. yesterday and today.

so, this storm could not have worse timing for holiday travel. sara >> thank you very much what a nightmare for some folks trying to get somewhere before christmas. after the break -- by the way, the airlines are down but the market is up and the nasdaq just joined the s&p 500 and dow in positive territory. we'll talk to interactive brokers chairman thomas peterffy we'll back in two minutes on quk t see"sawonhetrt. wow, we're crunching tons of polygons here! what's going on? where's regina? hi, i'm ladonna. i invest in invesco qqq, a fund that gives me access to the nasdaq-100 innovations, like real time cgi. okay... yeah... oh. don't worry i got it! become an agent of innovation with invesco qqq

welcome back to "squawk on the street." i'm bertha coombs. more than 200 million americans are under some form of a winter weather advisory or warning. forecasters say the bone-chilling storm is nearly unprecedented in its scope from texas to maine. more than a million homes and businesses are without power according to tracking site power outage.us. in paris, a gunman open fire

on a kurdish cal toural center and cafe killing three people and wounding three others. 69-year-old suspect was rowound and arrested prosecutors are looking into a possible racist motive for the attack. mitch mcconnell heaping new criticism on former president trump. mcconnell says trump's political clout has diminished, in his words. he blamed trump for driving away independent and swing voters leading republicans to underperform in every state. this as the january 6th panel released its final report, laying blame with for the capitol hill insurrection on the ex-president, saying the attack would not have happened without him. back over to you, sara >> bertha, thank you turning back to the markets, we're about an hour into trading and things have definitely turned around in a positive way. the s&p 500 is now up 0.4 and you have every sector in green technology is the only one in red. the market is led by energy, communication services are

coming back, utilities the nasdaq has gone positive, even though we're seeing a little higher rates. amazon, alphabet, that's what's leading the charge apple still under pressure and so is microsoft. as carl mentioned, we're still tracking for a positive week here for the dow the s&p, almost. if we continue to build on these gains. joining us is interactive brokers founder and chairman thomas peterffy. it's great to have you here. with this difficult market this year, this month, how are retail traders positioned right now >> wall street traders have made their choices. they either decided to ride out the coming downmarket or hedge their portfolios or liquidated they keep their money in their brokerage accounts, interactive brokers is paying 3.88% on cash. >> in other words, keep it in

the entinteractive brokers acco. shameless plug it's certainly helped your business how much pain has there been for your clients >> say again, sflees. >> how much pain has there been for your clients >> well, most of our clients have hedged earlier on and they realize that we are looking at a decade where inflation rates over 4%, the fed tried to fight it but eventually recognized the causes are beyond their control and they are basically big globalization will continue at a faster rate as the u.s. is giving up control as police of the world, geopolitical tensions will continue to rise, chip interest rates will rise or become

unavailable. the demand for esg spending by corporations will keep increasing inflation will continue to pick up as the availability of skilled workers will decrease as baby boomers are leaving the workforce in increasing numbers. so we are in a global demographic crisis they are being replaced by young, less educated people in countries. rising debt service, rising interest rates, and so i expect the market to fall to around 3,000. and the only hope out of this situation is scientific advancements, the economy will grow out of its increasing debt

burden >> so it sounds like you think -- it sounds like you think in the shorter term that investors are more focused on the back drop of earnings rather than whether or not this inflation accelerates or the fed pauses >> well, earnings are -- we know that earnings will be lower in the coming quarters, right so, you know, i think that the only thing you can do is to try to sell individual stocks where you think you can have a good chance of doing some option spreads and make a profit on catching the correct waves >> does margin debt on the retail front look bad in historical context right now >> margin debt is roughly 10%

under its all-time high. so, it's not -- it's still quite high >> that sounds bad, i would think. i wanted to ask you about the meme trades. bed bath & beyond is down 80% this year. amc is down more than 70%. >> yeah, but where it should be, right? >> i know your feeling on that but is that whole meme trade phenomenon dead? >> i certainly hope so i mean, people should really learn that this is a very, very bad idea it's certainly a losing trade to buy stocks that have no fundamental values it's nuts. >> we wanted to get your thoughts on new s.e.c. proposals that may be coming and that have advanced on trading that would really alter the plumbing of the markets here and what you do as

brokers on transparency. they made it a big priority after the meme mania what's your take on how it's going to impact your business if it, indeed, passes through this public comment period and then moves forward? >> so, i think that the reforms, the idea of having smaller increments on very actively traded, lower priced stocks is a very good one, very good idea. i think it will diminish the cost for traders now, the issue of of this option, that's a difficult question because, i mean, looking at it superficially, it looks like it is goes to be good for the -- good for the customer on the long run, however, we

don't know the expense that it will -- that it will take to bring that all about and whether there are some hidden consequences and the savings that are supposed to be a billion and a half dollars, i don't think, is worth the idea of accepting the entire situation the way we are doing it today so i'm really not in favor of the option idea. although it is basically interactive brokers currently is doing very similar auctions the way we execute trades. but putting that burden onto the entire industry may not work very well. >> we'll keep an eye on that i'm sure you're making your opinion known. thomas peterffy, thank you for your time. >> thank you for the opportunity. still to come this morning, energy is on the rise. crude up more than 3%.

got some headline suggesting russia might curtail some output we'll talk about the sector with ea aerhed morrisft t brk.

welcome back oil prices moving higher today as russia says it may cut its oil output 5% to 7% in early 2023 joining us this morning, ed morris, citi's global head of xhotties and research. happy holidays great to have you back i have to say, your call on crude in the middle of the year, when everyone else was saying otherwise, still one of the best directional calls of the year, i think, at least in commodities i wonder, just your thoughts on how 2023 is going to shape up. >> well, actually, we think it's going to shape up significantly like 2022. we think there's going to be more oil in the market than demand we have chinese recovery not really happening yesterday there are no lockdown measures but people aren't going back to

work because of the covid. any amount of recovery will be towards the middle of the second quarter, at the earliest we have u.s. recession, at least sharpest slowdown coming up before that. and as we look at demand right now year-on-year, it's lower than it was a year ago so, we think supply is going to be more robust by a factor of two, knowing there are a lot of unknowns the 50,000 to 700,000 barrels a day of potential lost russian crude as you noted are something that we already factored into our balances, on the one hand. it's intriguing they say that after the deputy prime minister, not the foreign minister, but the deputy prime minister said production is going up this quarter versus last we'll see how noisy the russian news is. >> right what do you say to those who do argue that you will see supply seize up and see sharply higher prices some time in the coming year you must be assigning some kind

of probability on that scenario? >> oh, absolutely. but we don't i think it's a function of lack of u.s. or brazilian or canadian supply we think the hemisphere will be adding 450,000 barrels alone we know there's dissent within opec with the uae wanting to pump more oil, not cut back more i think the big issue on the supply side really is whether there are going to be disruptions in supply from libya, which is at 1.2, could go down to 200,000 or 300,000 a day. iran, where we have people taking to the streets, just as they did in 1978 and '79 they have not yet gone to either the well heads or to the refineries or to the ports but that's not a low probability. iraq also is suffering from significant strains at home. you have the largest party having pulled out, not having to create a government after the

elections some 13 or 14 months ago. so, there's plenty of oil around russia, iraq, iran, libya, nigeria, which could follow the market we think the supply side risks are really on the disruption side rather than some kind o >> what if the war ends in ukraine? >> we would see the price suddenly going down, but i'm not sure the knee jerk reaction would reflect reality. there are long-term lessons in europe on their overdependence on russian material. that goes across 30 different commodities. they had been rather blase that

russia would never take action to upset the status quo, and i think that lesson, particularly given the humanitarian disaster is unfolding in ukraine. that lesson is in the european political system when it comes to increased reliance on russian commodities. i don't think we are going to see with a sudden truce that we will see anything sudden happening with respect to price gaps, with respect to reluctance to buy russian crude until we see what the europeans see, what the americans see what the next steps might be. >> certainly that definitely fits with some of the rhetoric we've gotten in the last couple of days. happy holidays to you. look forward to a lot more guidance in '23. >> thanks and happy holidays to you all. thanks for having me on. >> driving all the energy stocks earlier. quit programming note. later today on closing bell, 3:00 p.m., an exclusive

interview with howard marks. we put out a note saying this is the third seed change he's seen in his investing career. we'll talk to him about what it is and what that means for next year we'll be right back with the dow up 29 and the s&p 500 holding on to some gains here we'll be right back. for the gifts you won't forget. happy holidays from mercedes-benz. see your mercedes-benz dealer today for exceptional offers. ♪♪ ♪♪

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coming up in the next hour, watching the latest in regulation and tech. microsoft responding to the ftc in their case to block blizzard. and meta settling atth privacy lawsuit. the latest coming up in just about five minutes don't go anywhere.

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it will strike a chord with movie goers of all ages. when you only have one life, that's what makes it special. rated pg. only in theaters. welcome back to "squawk on the street." before we go, we wanted to check in on the markets. the tone is a little better. the s&p and the dow have gone positive so did the nasdaq but now it's slipping negative. let's bring in bob all of this coming amid a backdrop of a lot more economic datament some of which is good showing inflation is slowing down and bonds are selling off again. what do you make of it >> yeah. unfortunately rates are trending up again after trending down, so it is very hard to get a clear trend. it is 3-2 advancing to declining stocks the numbers were better at 10:00 a.m. also new home sales numbers were better we got a boost on the s&p.

went positive on that. the big winner of the day is energy a quiet rally going on in energy we went from $70 in oil to $80 in oil these are the big winners on the year these stocks are up 60%, 70%, 80% on the year. big cap tech is more stable, micron is positive it is mixed. microsoft and apple, apple is down 25% for the year. some of these are trending down in the last two weeks on earnings revisions downward for 2023 tesla, well, new low today tesla has gone from 200 to 123 literally this month you know what's remarkable about tesla? 2023, forward estimates are like $22. it's gone down dramatically in terms of the market multiple that it's valued at. so let's call this a nice start

to the santa claus rally it is the last final trading days of the year up 1.3%. at least we're off to a good start on the santa claus rally back to you. >> thank you very much down three-quarters of a percent on the s&p so far for the week that will do it right now for "squawk on the street. i will show you later on "closing bell. in the meantime "tech check" starts now. >> good friday morning welcome to "tech check." a busy day today markets seeing an ugly end of the year nasdaq down 9% over the last three weeks. where to pile in and what to avoid going into 2023. microsoft responds to the ftc. the latest on the tech giants battle with the government cyber security struggles, hitting its lowest levels since