yield curve's sort of -- >> down by 200 points, s&p up for now. we'll see where all of this lands both at 9:30 and then at 4:00 p.m. today as everybody weighs it all. make sure you join us tomorrow we're going to be standing by right now to watch our friends on "squawk on the street." >> we're here? >> we're here. see you tomorrow ♪ good thursday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer and david faber, live at post nine of the new york stock exchange. futures trying for a rip here after cpi comes in negative by 0.1% we'll talk about the implications for the fed and the markets, along with this new proxy fight at disney in a few moments as the guys on "squawk" told you nelson peltz seeking a seat on disney's board we'll begin, though, with december's cpi, in line with

expectations, down 0.1% month on month. easing back to 6.5%, jim, although i know you're looking at things like, why would apparel be up? >> i hate to actually criticize what are numbers, because it's numbers versus numbers i should have criticized last year's but i'm dealing with melding the companies that i speak to every day with the numbers there's an apparel glut of just incredible proportions, probably one of the greatest times to buy apparel ever that i have ever seen there's anything from denim to cashmere that's not on sale. so, clothing is up apparel is up 0.5% give me a break. i mean, i look at things like new and used vehicles, and used vehicles, we see, are plummeting not really reflected here. and i know -- well, give me a break. eggs are the new lumber is what they say eggs are up double digits, so we can pin the tail on the eggs

>> that's because of the -- the avian flu. >> that was called a joke. >> oh, sorry i missed it. >> i do want to point out f you looked at three months ago, what we thought natural gas was going to be, and that is the heating fuel of the country, i think we would say, we're in deep trouble. instead, i think we can say, burn, baby, burn, disco inferno. >> meanwhile, you got harker saying the days of 75 basis point hikes are behind us. >> yeah, that's history. >> you got claims at 205, jim. people are talking goldilocks this morning >> if you didn't know any better, you would think there's a fed chairman that's doing a good job i know i'm in the minority there's family members probably with him but these numbers are exactly how it's supposed to slow down i mean, i'm not in a boeing plane right now, boeing recommended by credit suisse, but i would say this is a very clear dashboard, and it's going, david, the way it should it's not cratering it's slowing and it's got a lot of businesses that are really playing a role,

whether it be logitech, taiwan semi saying the next quarter or two are going to be weaker, or whether it be beer prices coming down i can see a plethora of things that are going the way of jay powell >> the market seems to be satisfied with the number as well the s&p bounced around a bit but we are most likely going to have a higher open. two-year went up but came back down appropriate response in the markets, in your opinion >> yes, i think so i'll tell you what's really incredible did we not pull for this every day, carl, we've been up this year. nasdaq up three. did we not anthonyicipate this if we're up again on the same information, i begin to think there's an era of good feelings that nobody counted on, including some people like, i don't know, mike wilson, somewhat negative fellow i know, look, someone who's right, you don't make fun of,

but the fact is that there is a very different tone to what's been going on, and i thought it might be predictive of this, and when you get these numbers, and it still goes up again, that's not like 2022. >> we're going to make a run at s&p 4k this morning. haven't done that since the middle of december >> people were saying 33 -- there were a lot of people who said 3,000 there were people who came on who basically just were predicting an ice age. this is not an ice age it's just not. >> we are going to be joined by nelson peltz, as we've said a number of times, only a few minutes from now, but jim, i certainly will turn to you and ask for your overall take on what we've been reporting since roughly 4:00 yesterday peltz is coming after a board seat, really only built his position in the company in mid-november, although he did begin discussions, broadly speaking, with them in july, at least with management at the time of course, disney was run by bob

chapek disney is going to be replacing its chairman, susan arnold, with mark parker, ceo of nike he'll step up to the chairman role after the next annual meeting later this year, and they're reducing the size of the board from 12 to 11, but the main thing here is, they said, no to peltz who said, i want a board seat >> the toughest thing for me is if i were nelson and it turns out this started in july, what i would say is, i don't trust chapek, and that was verified by the loss i would like to see someone at the chairman level really doing a great succession job i think one of the strongest people on the board is mark parker, so we've got to see, basically, did nelson get what he wanted and then is still going for something else or are there really some problems that really need nelson to fix >> that's a great question i mean, listen, they put a white paper out, making their case to a certain extent, not asking for things or not focusing on things that are specifically media-related, like, do this

kind of movie or, you know, direct-to-consumer but the broader stuff. capital allocation, corporate governance and strategy and operations, cost discipline, all the things they're asking for. the most damning slide may be -- let me find it here. >> tsr >> well, certainly >> tsr of what they think iger's was, versus what iger says what's the damning slide >> i think also -- there it is page 14. financial performance in terms of its disappointment. this is, of course, their numbers, but an $8 billion increase in sg&a, 400 basis point increase $24 billion revenue increase from 21st century fox. but ignore the rest of the income statement >> david, restore the magic. >> all right that's what they say that's what we're going to talk about when we come back with nelson peltz

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♪ welcome back nelson peltz challenging disney and its board of directors he wants a seat on that board at the company's upcoming annual meeting. that's a number of months from now. joining us now is nelson peltz, trian partners founder and ceo nelson, great to have you. so much to get to. let me start by changing a quote from a famous movie with my first question of all the companies in all the industries in all the world, you got to walk into disney? why? why disney why you? >> david, good morning and good morning, jim. why not? we have skin in the game you know, we looked at a company, and we looked at disney, and we say that this is the most advantaged consumer company on the planet. and we love it that's the reason why we're

here however, the tsr, the total shareholder return, over one, three, five, ten years has materially underperformed the s&p and underperformed the proxy peers that the company's selected equally as important, a lot of retail investors in this company. they eliminated the dividend that was in effect for 57 years. 57 years of a dividend, and now it's gone. and now they want to tell us that everything's going to be great again. we think that we can help. we have a record of helping, david. david, i know you've seen our slide deck >> i have. >> if you look at our slide deck -- okay if our slide deck only had three

pages on it, it would be page five, which is the stock chart that would be our first page okay it would be page eight that would be our second slide page eight tells us that on every board that i have served on -- and i have probably served on more boards than anybody that i know -- that company, whatever board it was, has outperformed the s&p by 900 basis points annually >> right >> annually. >> nelson, nelson, people -- people can -- i know you are you're very long-term. average as much as six years that cannot be a criticism leveled against trian in any way. and people can follow at home when you call out page numbers, but let me come to some specifics here as well, which is, you know, you're going after

a company that has now announced it's replacing its chairman, that, since you built your position, has replaced its ceo, and that has embarked on a cost-cutting program that seems to at least mirror, to a certain extent, some of the things you're asking for. why continue to want a board seat when they seem to be doing a lot of very active things, nelson >> think of all the positive impacts we have had in just such a short period of time think how much more we can help. the fact that they changed their chairman, well, they had to. ms. arnold is stepping down this year but they picked mr. parker, who did a wonderful job at nike. now, mr. parker will be the second of only two people that we know of in corporate america that are chairman of two companies simultaneously

but he was here -- he voted for the fox acquisition. he voted to make the acquisition of sky think about that they lost about $50 billion on fox. fox hurt this company. fox took the dividend away fox took -- created what was once a pristine balance sheet into a mess. >> right, right. >> had they bought sky, which he is everybody else bought, they would have spent a hundred billion dollars. they would have spent $34 billion at their price for something that analysts estimate today is worth $9 billion. >> all true. all true, nelson, but when it comes to sky, obviously, they did bid it up, but then our parent company paid and they benefitted from that as a significant shareholder and owner of fox, that being disney. you know, listen, i know you're

focused on the fox deal. >> david, david, you're 100% right. but the $50 billion is after the sky proceeds >> understood. >> that's negative sky proceeds. >> i understand that and the debt taken on there. they would claim, of course, nelson, that covid played an important role here in terms of where they stand on leverage and keeping the company going, and they would also say, and i want you to answer this criticism that -- listen wait, nelson, let me finish. >> i have to interrupt i'm sorry. >> let me just finish the question they would also say that you're acting in part, you know, this is really about -- this is about your ego this is about hubris to some extent this is about nelson peltz saying, hey, i still want to be on your board, even though you just did replace your ceo. i'd like you to respond to that criticism, because it will come from the disney side >> i'll be happy to. they offered me a board observer

yesterday. they said, you can be in the meetings you don't have a vote. okay and we'd like to hear what you've got to say. that means they want my input on operations, but they don't want my input on corporate governance that's why they don't want know h me to have a vote. that says they believe, even, that i have something to add >> well, nelson, it's jim. i think that's a very interesting point you just brought up when you were admitted to the procter board, again in a proxy fight, i know that even without the proxy fight, they spent a lot of time with you, and they talked with you, the garvey plant. when you spent time with the governance and nomination committee here, and i'm sure you did, why did they say you might not be the right man >> okay. let me tell you something. they said they met with me several times. as you guys know, we've been

through this drill many times. most of the times, it doesn't even reach your network. most of the times, we make this peaceful solution, quietly, and we get a board seat. but the fact is that they didn't meet with me several times even at p&g, where we had the big biggest proxy fight in history, i had many meetings with management, with the board individually, as a group, committees they even allowed me to address their management sessions. think about that here, they gave me -- i had a less than a five-minute phone call with bob. he told me his lawyers wouldn't let him speak to me. now, bob invited me, which i did, in 2019, to come speak to the disney board they wanted my opinion on

things they invited me. obviously, they had some respect on what i had to say they wanted me to talk about at&t they wanted me to talk about the economy. they didn't limit me, but they gave me a five-minute conversation and then bob said, look, he was sailing on his boat in new zealand, okay, and then i had one meeting with the board >> one meeting >> a zoom meeting. >> one meeting how long was that meeting? >> 45 minutes. >> how many minutes did they want to give you >> okay. they wanted to give me 30. okay >> so, they gave you 50% more time, nelson you're not making a point there. >> jimmy, you're 100% right. >> okay, let me ask you something else >> jim, let me just -- >> what? >> okay, let me just finish this because this is an important

point. they gave me 45 minutes. i was in a room with a screen of all the directors except for bob. they were on screen. they heard me. there was not one -- not one comment, not one question, just, "thank you." okay in the room with me, i was with bob. i was with christine and i was with a handful of their senior leadership team, none of which had any revenue or profit responsibility. all staff. >> okay. all right. well, look, one of the things that occurs to me -- i know that you are not happy with what i believe is to be a $71.3 billion acquisition of fox now, they intertwine that. it's very difficult to figure out what that is worth but what would you think about if there were able to have a writeoff $25 billion or $30 billion or

maybe $50 billion or shareholder money? how much would you have written off if you were able to? >> look, i don't have -- i'm not an accountant, but it clearly is probably going to start at a minimum with 30. okay and maybe more okay i can't tell you because i don't know how they carry it on their books, but i will tell you -- >> but the people who voted for this, the people who voted for this acquisition, they all seem to have what you, i think, would regard as fingerprints so, my question is, why are you only asking for one? i would think that you probably at one point would have wanted three or four board seats to be able to clean it up, given the fox acquisition and the balance sheet from hell. >> jim, you're right it is a balance sheet from hell. but jim, look, i was one man on the board at heinz no, i was two men. i was one man at the board at

mondoleze. i was one man on the board at p&g. good things happen i don't need to overwhelm them i just have to speak reasonably to these people and explain to them where we think they have gone wrong or what opportunities they're missing. when you get on the board, you get the inside numbers you really hear directly from management you can ask questions and hopefully get the unvarnished answers. so, that's what happens when you get on a board i don't need more than one person on this board i don't need to split their vote >> nelson, i've made that point. one person can, obviously, do a lot on a board, particularly if it's an effective person i want to come back to the timeline if i can here you built your position, it seems like, from the exhibits to the proxy, you know, november 8th to november 16th did you originally want to get rid of chapek? was that the point here? was that really what you were going after, and then you had to

kind of shift? >> you know, david, if you look at my record, i've never gotten rid of anybody think about that i want to say that slowly. even those who had proxy fights that i won, nobody left. david taylor is a reference for me bill johnson is a reference for me okay that's -- ed green, who came in as the ceo and chairman of dupont, is a reference for me. >> yeah. >> so, these are people who i fought with publicly, and then -- and got at least in two of those examples, got on the board. so, the fact is, i'm not disruptive i think i'm constructive if i wasn't, they wouldn't give

me references. i can't put words in their mouth. but look at the results. look at what happened at p&g i got on the board the stock was in the 70s i got off at the end of '21, the stock was $160 that wasn't magic, okay? >> understood. understood >> margins went up >> you know, again, people will look at your totals in terms of what you say is a 900 basis point outperformance during your periods on the board of various companies, versus the s&p. you know, i do wonder, though, nelson, what is it you bring to the board in terms of any -- you have no media experience now, there are other members of this board who don't as well, but you know, disney would push back and say, well, what's he going to advise us on, how to do direct-to-consumer why? why should nelson be on this board? >> david, they have a lot of media experience look at the numbers.

i can lob that same question back to them but we've invested historically in lion's gate, in time warner, in comcast i currently sit on the board of msg, and this is a lot more than a media company. this is a consumer company with a basketful of the greatest brands in the world. >> that's true although, i will say, you sit on the board of msg you want these guys to be better at corporate governance. i mean, nelson, talk about poor corporate governance msg? >> the hockey team's doing good. okay come on. david, the hockey team is doing great. >> you got that going for you. all right, nelson. okay >> msg is not a trian investment it is a personal investment, okay and the fact is, they do have

super voting stock, but they also have huge skin in the game. they own a lot of stock. it's not like a lot of these companies. >> let me get jim back in here >> one of the things that's never happened is the board has never addressed, at least publicly, what happened with chapek, that fiasco, what happened with the fox acquisition. my travel trust is a shareholder in this company. i find it is time for truth and reconciliation what the hell happened here? and when are we going to find out? because this is an american iconic company whose business was basically put through the wringer, and we don't know a thing about what happened. >> you are 100% right. this thing has been put through the wringer. bob iger was there until december 31st of 2021. he was executive chairman. i'm told he physically never

even left his office, and he was still the guy that people were checking with. then, he stepped away. okay chapek was put in power. i'm not going to comment on whether chapek was the right decision or the wrong decision, because i don't want to talk about the departed but the fact is that i don't know that he was given an opportunity to do his job, and what i do blame is i do blame the cfo, because the quarter that he was let go on, which was a disaster, usually -- usually, the cfo will start to warn the street, tell them that things are not good, your consensus is off. they start to do that mid-quarter or as soon as they see the signs that they're going to miss, and this was such a dramatic miss, and chapek bore

the full responsibility of that, and -- >> oh. >> oh. >> oh, man >> and zoom stock had been going higher >> we were told that the zoom link would not expire until 9:30 we're going to try and get nelson back. >> in the interim, david, he's making some points that are surprising versus what the company has been saying? and how long he's been actually at this versus what we thought >> yeah, well, first meeting took place in july, but he didn't own any stock then, jim, at all, which is interesting >> but you raised that point didn't he get what he wanted now it's not enough? >> that's the question >> he says he can bring a lot. >> we didn't get a chance to talk about the fight itself in terms of what he thinks his chances are. again, hoping to get him back, although time is wasting here. >> were you surprised that he didn't even meet with the corporate government nominating committee? >> they kind of stiff-armed him.

>> 45 minutes at a major company. >> am i told he's good again or no nelson, i think you're back. okay you know what? let me ask a quick question, because we are going to hit an opening bell here for a minute you know, i know you have a long relationship with ike perlmutter, and i'm curious as to whether he's advising you at all, what role, if any, he's playing in terms of how you're thinking about disney, because he has no love for iger anymore. i think thhe's bitter about kev feige taking over certain parts of the role there. >> i'm friends with a lot of disney shareholders, a lot of them a lot of the disney shareholders have voted for me in the past. a lot of index funds -- there aren't a lot of mutual funds left in the company because they don't see the future maybe they're coming in now. so, i know i -- i know many

other shareholders of disney, and if any of -- if there's a shareholder of disney that's happy with what's going on, that guy's been short the stock >> that's a good point >> you'll have to ask him. >> nelson, how do you see this proxy fight playing out? obviously, we're very happy to have you communicating with us first here on cnbc i would assume you'll be doing that but we've got universal proxy access i think it may be the first time you're doing a prieoxy fight une that it's hard for me to imagine, given everything you've done, that you may get the index funds on your side how do you see this proceeding, and does universal proxy access help you at all? >> david, our lawyers, i think, are responsible for the universal proxy card we lobbied the s.e.c. after the

p&g proxy fight because it was so confusing for shareholders who got card after card after card, rainbow-colored cards, okay and now they finally have one card with everybody's name on it i think it's a great advantage for the shareholders that's what's important. because now they can make their decisions on one card instead of several. >> okay, so, nelson, my last question would be, i think that what you -- what can you do about disney plus, which was the -- supposed to be making a profit very soon do you offer any advice? more content, less content, more family content do you buy or sell hulu? because this balance sheet's so bad, i don't know the optionality here >> jim, you're 100% right.

sitting where i'm sitting, not inside the boardroom, not having access to the numbers the way i'd like to, i think they have to -- they have to buy uber, or they have to get out of the streaming business they must buy hulu unfortunately, that means this company is going to have a debt load going forward for several years. so, they've got -- that charcash has got to come from somewhere my goal is to reduce corporate overhead to a point that the company gets better. look what happened at p&g. we got there there were 11,000 people in corporate. we left, there were 4,000. nobody got fired they were put inside the businesses so they were part of somebody's p&l i'd like to see this company stop running like a matrix and start running like the companies

we have been involved in where they have real ceos of businesses with real p&ls, real cash flows, and real projections. i know it's hard in the movie business, but it's not that hard in the streaming business. and they've got to be able to do that but don't forget, you talked about covid. you can talk about all that stuff. but the fact is, they are getting record profits out of the park, in spite of where the stock is in spite of where the p&l is the parks are generating record profits. >> well, you say they're overearning. what does that even mean, nelson to say the parks are overearning somehow implies, what, that they're pushing price too hard that they're going to suffer as a result of that that's what you say in your presentation >> yeah, i think they probably pressed -- pushed price a bit

too hard bob has readjusted that a bit. i think the parks -- and i'm not an expert here -- probably need a little bit more capex. but the parks are generating huge profit, huge cash flow, and they want to blame this stuff on covid? the parks rebounded out of covid like crazy >> why not build more parks? chapek did not commit to building more parks. why not? they have the ability. they have the ability to build more parks >> i know, i know. >> jim, where's the cash going to come from to build more -- i'd love to build more parks comcast said they're building one in texas and one somewhere else i'd love to build more parks >> nelson, let me just finally end with, you know, iger is considered one of the great ceos, and you're not looking to get rid of him, but you're certainly not endorsing him here why not just have confidence that iger is going to be able to do what needs to be done here?

he has led this company for many years previously through great success. you know, i don't quite understand why you don't seem to have confidence in his ability to come back in here, successfully find a successor for himself, but more importantly, do the things you're talking about >> david, look at his tsr. look at his tsr. take it through year-end when he stepped down as executive chair. take a look at that tsr. and then you tell me the answer. it's right in the book >> i know. i got the page i got the page we've all seen the page. >> what does it say? >> i did look at the comp set too. it's kind of a weird comp set. it includes meta and alpha and amazon, but many of them have been down as well. at&t, warner, paramount. >> david, david, you know who picked the comp set? >> they did.

they did >> disney. >> yep i know you took it from their proxy i know you did i just checked it. nelson -- >> can i just ask nelson something that's bothering me? nelson, katz, who runs oracle, truly great executive, you tried to speak to her. at one point, she says she can't speak to you some lawyer told her she can't speak to you what the heck is going on? why can't you speak to people on the board? >> is this communism i mean, really are we in china, or are we in america? >> let me check it out i don't know >> it's ridiculous jim, during the p&g proxy fight, i could speak to any director whenever the hell i wanted and they could salespeak to me we had a better understanding. that's why, when i came on the board, after that ridiculous

proxy fight, unnecessary proxy fight, everything was collegial. they gave me a parting gift when i stepped down i still have it. it meant a lot to me my parting gift to them and the shareholders -- let me finish this one, david. >> okay. you finish and then we got to go >> my parting gift to them was margins went up 25%. market shares went up for the first time in a dozen years. and the stock went from the 70s to $160 in three and a half years. >> nelson peltz, always a pleasure >> i'll end on that one. >> thank you thank you for joining us >> i'll talk to you again, i'm sure >> look forward to future conversations. >> thanks, guys. i'll see you soon. >> thank you >> okay, good. nelson peltz guys, let's get back to stocks we had an oepening bell, carl.

>> well, disney's one stock, up 2%, that's going to take you back to november >> well, look, the last quarter was one of the things that happened that last quarter was a shock to everyone i know that nelson talked about how the cfo, christine mccarthy, looking at the numbers, probably shouldn't preannounce. i think it wasn't the cause of nelson getting involved, because that was july, but it's the proximate cause for a whole lot of things that happened because the $1.5 billion loss is now behind us, and i say us, because my travel trust owns it. that was a dismal day. it was one of the worst declines i've ever seen of a major stock, so carl, this one's at least made up what happened on what was a oomsday for chapek >> to david's question on the broad retail ownership, does that make the hill steeper for nelson or not, jim >> i think that he's got a real shot here. i mean, i think people have lost a lot of money in this stock, and they are willing to -- they're not going to say, oh, mark barker, that's terrific,

because they don't know that mark parker is the -- one of the great heroes of nike they're not going to say, wow, he -- i guess he spoke -- he didn't get to give a chance, but that's okay. i think they're going to say he spoke for 45 minutes he didn't meet with anyone what is it that they're afraid of and that's, i think, the point he's going to make >> that's an odd situation overall. i have to say, just having followed so many of these through the years, in part, i do still wonder why mr. peltz feels the need, feels compelled to be on this board. at the same time, from disney's perspective, just not sure it's going to be worth the distraction, worth the endless conversation that's going to go on why not just put him on? >> that's what i -- put him on >> you wonder why they didn't. but they haven't, and here we are. it's going to make for fun, for us, certainly. >> dan loeb was involved >> dan showed up with a list of certain things that he wanted

considered i believe he's still a shareholder here as well it hasn't gone particularly well for him, by the way, as you know he kind of came in with the idea of really supporting chapek in many ways and trying to sort of give chapek -- >> he did get carolyn on the board. >> yep >> any time anybody buys stock, they get to put someone on the board? is that what you're thinking >> no, but i think that does figure into this, jim, in the sense of the, the board says, we already dealt with loeb. enough here. but obviously, not enough for mr. peltz, who wants a presence on that disney board >> but david, you know, i remember talking to mr mr. mcenerny nelson talked to a dozen, multiple times i remember speaking to jim, and he said, i've talked to nelson how many times i don't know this board has not truly

engaged. >> you can read the background, at least from trian and you can see there was not a great deal of engagement, carl. >> but the 45 minutes as opposed to 30. >> that was good jim, you mentioned boeing a moment ago we did get that upgrade. >> nice, from credit suisse. >> they talk about not just the order deliveries -- by the way, they're going to neutral from a sell, but they talk about china letting in australian coal once again, maybe a good sign for boeing getting access. >> i agree that. by the way, american airlines, fantastic interview this morning with phil lebeau the airlines are doing incredibly well. they're flush. the chinese might be coming back, looking at the max this may be in spite of itself, obviously, because airbus doesn't have any planes. the 787 is doing well. i know there are very big concerns about boeing's balance sheet, but this will help the cash flow. i have to admit, much to my chagrin, because my travel trust did sell it, i thought it needed

too much money, but things are going up >> ual is up 30% this year >> i know. without nelson that's a joke. remember the proxy fight at ual? >> we haven't talked much about ge since the health care spend a bad investment from trian. remember it felt very compelling at the time. obviously, it did not go their way at all there are -- >> look, i just -- people make mistakes look, i just admitted to a mistake. look, if you were perfect, what would you be doing talking to -- you would just be on an island bigger than ellison. >> without a doubt >> the right ellison, not the wrong ellison, the ftx ellison >> not ralph waldo got it >> look, i don't want to minimize this. disney is a major company we all

love, and that's why we're spending a little more time on it than we would normally. if we were speaking about a big tool and die company, we would not be spending so much time >> these names always get outsize coverage let's talk about another name that gets a lot of coverage, tesla. shares all over the map this week, down 2.7% after what was a significant move higher on at least, you know, some enthusiasm around the idea that they're going to expand the plant in austin stocks down 3% for the year. basically, today's move is off of flat for the year >> i'm going to give you a little conjecture here if you listen to the taiwan semis conference call, which was in the middle of the night, they talked about how the semis are going to be available for ford and gm well, that means they're going to have the semis that they need to make the competitive cars and trucks to tesla. taiwan semi is the great repository taiwan semi, by the way, said

the first quarter is not going to be good but i think taiwan semi holds the key to the competitor semiconductors to go up against tesla. i think ford is going to be doing 30,000 evs a month, beginning november maybe up to 50,000 they had the chips gm is ready too. competition, david competition to tesla >> well, your point about how it's reacting to, say, the operating margin guidance, electrolux yesterday rising on a pretty weak guide. do you think the market is ready for the earnings season that's about to come? >> i don't know. i mean, one of the most important companies that i look at when it comes to technology is logitech. they're talking about enterprise tech still being bad you have to look through the valley of the shadow of bad er earnings and fear no evil, and i've got to tell you, apropos of a lot of the people that come on, a lot of the money managers, they can't they can't go through it it's too hard.

they look at logitech, and they say, i'm going to wait no they're not going to wait. they're going to sell. >> right thus far this year, the banks have been a very good performer as contrasted with pharma, strong performer last year, so far, not, pfizer, the worst performer by far amongst the group of the mega cap pharma >> total rotation. we know that pfizer is doing well >> well, we're coming up on bank earnings very soon we're going to be talking about them >> like 23 hours >> yeah, any thoughts as we head into that? >> well, i think that the numbers we got today are good. people want interest rates lower. that's -- the bank rally started on october 16th when the ten-year peaked. that's when it really started coming in place, because people decided they cared far more about loan losses than they cared about all the money they'd make by giving you nothing on your deposit and getting 4%. they don't care about that, david. people care about loan losses,

so i think i have to listen to brian moynihan from bank of america. he's going to tell you there are very few loan losses two, charlie scharf from wells fargo is going to say it's the best they've had >> will the market respond positively to that, or is that already a known, as they, by the way, retreat from mortgage lending to a certain extent. >> that stock is going to depend on how many more they have to complete but jpmorgan has been just one incredible stock so, it is hard for me to believe that it can continue to be incredible unless they do a lot of things, you know, they say, listen, we can expand the buyback, the government's fine w with it, but will say as interest rates peak and not go up, and therefore the loan losses won't go up, people will buy these stocks even now, because they're still down considerably wells was at -- on february 8th of 2018, wells fargo was at $62. it's at $42 now. it's a much better bank now.

>> market's counting on 4.5% by year-end >> that was extreme. that was a hurricane >> he now says, i shouldn't have said hurricane >> well, you know, you can't -- >> he's downgraded it to a tropical storm >> i feel like in philadelphia, you got this guy, hurricane schwartz, who's retiring what matters to me is not the definition of it i think that if you look at the cpi, you'd be hard pressed to think that you need to take it to six >> which reminds me, the dow is down 165, but a big weight on the dow is unh we'll get them tomorrow. amgen, lower staples, health care, utilities, is that going to be a source of weakness from here on out? >> you know, unh is doing incredibly well. this is that rotation. humana, my travel trust owns it, preannounced better than expected numbers, and jpmorgan is getting killed. people are worried that a presidential candidate emerges for the democratic party and

starts taking aim at these companies. they've always been pinatas for democrats. >> we'll get unh tomorrow along with, as you know, the major banks, and blackrock, and because of that, we're going to talk to larry fink on this show tomorrow >> oh, that's big. >> yeah. >> larry does more than just put out his numbers. he gifves a manifesto that probably is more important than jpmorgan's jamie dimon >> well, his annual letter as well yeah >> larry has tremendous sway the question you asked about universal proxy. >> that was -- that's something we got to sort of adjust to. it does make it easier to launch proxy fights but so many things to talk to mr. fink about. we want to dig into earnings with him initially, and then broader debates around esg and what they've been dealing with as well. >> tomorrow, really, i've got to tell you, i want people to do a piece on this. don't make a decision that, oh, jpmorgan's good. oh, citi's bad

there's a plethora of bank earnings and banks tend to trade together, unless there's some sort of takeover, like, you know, first tennessee. >> i did want to get you on, for example, jim, bed bath up again today obviously, it's doubled over three days crypto, up eight straight days, back above $18,000, first time since december market is rewarding a lot of things you don't like. >> well, i mean, bed bath put out a note, and the note said that it might not be a going concern. and the stock's up big since then now, we did see, david, once hertz did, you know, kind of -- >> hertz filed, and then the stock traded higher after bankruptcy, which was one of the stranger things we've seen in some time. the company in a position to potentially have issued equity the s.e.c. quashed that at the last moment. but there was recovery value on hertz. >> there was, absolutely >> in part, because used car prices at that point were soaring as well. >> there's chapter 7 versus chapter 11

i think that bed bath is in trouble enough they might want to liquidate the people who are buying it right now, they remind me of another era, the gamestop era. >> is that an era now? >> it's a centozoa era >> as we go to break, let's look at bonds what a busy morning between cpi and disney but cpi did come in down 0.1% as some banks did forecast. ten-year did dip below 3.5%. still lower. back in a minute yeah, let's redo the basement. hello home movie theater. (laughs) spare bedroom.

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dow 30 heat map lost some grounds at the open as we get dragged lower by umh, amgen, even apple and j&j. disney remains the top performing component of the day

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let's get to jim and "stop trading". >> rbc capital say the time to go back to the internet.

secular, bring it back, and they like meta. get this, second half setups, google and amazon. two of the most despised stocks on earth i notice google is trimming some of its people. might have been health care units. this is the beginning, i think, of people saying, faang is not dead i think faang, some of faang has been root canal. >> yeah. well, then you had the president's journal op-ed yesterday going after big tech saying he wants bipartisan unity on holding big tech accountable. >> i want big tech broken up i think what sapp is worth a lo. >> i'm using it right now. >> and denbury reportedly in talks about exxon. >> please ask about that

there is a belief that denbury might be something exxon is interested in and maybe the bid/ask is too far off. >> it's interesting. >> it's interesting what they're doing in carbon capture. >> join me, ask some questions -- >> you should stick around, david. >> you got it. you're good. you'll be all right. it will be right over there, right? >> we'll watch from home we'll see you tonight. >> "mad money" 6:00 p.m. eastern. when we come back, a lot more on nelson peltz and his proxy fight against disney, leading the dow, and waiting on potus and remarks on this morning's cpi print. to adapt in a fast changing world, you could hire a professional pit crew. go, go, go. sorry. nope. okay. fresh donuts - hot coffee! they deliver real time data and business forecasts when you need it. i think it was fine how it was. (air tool sound) to help you stay ahead of the curve... or you could use workday. the finance, hr and planning system that helps cfos

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good thursday morning. welcome to another hour of "squawk on the street. i'm carl quintanilla with morgan brennan and david faber. markets swirling around on the heels of a cpi number that did come in negative month-on-month, down a 0.1 and year-on-year rate back to 6.5. >> we're 30 minutes into the trading session. here are three big movers. taiwan semi reporting its first

quarterly revenue miss in two years. the company says it sees an end to the chip shortage but also plans to reduce spending stock moving higher probably because of that. up 4%. kb home missing on the top and bottom lines q4 net punching 80%. orders are down big again this quarter. higher mortgage rates, uncertain inflation, uncertain economy making home buyers more cautious you can see, as i said, shares down 4%. we'll end with disney, electing mark parker activist investor nelson peltz pushing for a seat on the blue chips board. we'll have a lot more from that sitdown with peltz later this hour shares of disney up 2.5% first, though, let's turn to cpi, fell 1% in december, in line with expectations our senior economics reporter,

steve liesman, joins us now, to give us a bit more on exactly what happened here steve? >> hey, david, yeah, the year over year rate for inflation falling for the sixth straight month, core inflation down for the third straight month as the economy and the fed continue to make progress corralling enemy number one, that is inflation. cpi down, the first monthly decline since the pandemic, compares to a 0.1% increase in november that caused the year over yooer to fall. core 0.3%, but the year-over-year is dropping because bigger numbers are falling out of that rate some astonishing changes in the cpi here energy down 9.4% airline fares down 3.1%. used cars down 2.5%. even a decline in fruit and vegetables, even though food prices in general were still up.

there were some important sectors with rising prices natural gas up 3.1%. electricity up a full percentage point. most importantly, shelter prices, about a third of the index there, rising by 0.8%. that pushed up the year-over-year rate for the core service sector to 7.1% from 6.8% it's a sector fed chair powell is watching specifically and believes it's pushed higher by rising wages and wants to see more slack in the job market before giving the all clear on inflation. it could be misleading rents and housing prices are coming down. they're slow, however, to show up in the cpi. even powell thinks this area is coming down in momg months all combined, the market looked through the number, the outlook for fed fund rate. there's also a 91% probability of a 25-basis point hike coming

in the january/february meeting up from 75%. put it simply, the market doesn't see much of a 50 coming up later this month. the strong move down in the two-year yield suggesting the fed is going to do less and less the fed keeps saying it's going to do more and more. >> some argue they have a new alternative until they finally do stop. steve, we'll see we're watching the white house this morning as well the president set to deliver some remarks on the economy and inflation in a few moments we'll take you there live. in the meantime, let's bring in david kostin at post 9 great to see you we have inflation softening a bit. the labor market's resilient china is reopening europe appears to be averting disaster, for the moment is this goldilocks >> it is market has priced that that's the important thing market is almost 4,000 we're anticipating it will be at the end of this year the reason that's relevant is because cyclical stocks compared

with defensive stocks are pricing as those the ism would be a little under 50, which is where it is, and all that good news is priced into the market the focus now will turn to the level of earnings and what's happened to the profits. i think margins rolling over is the real concern we've had the most negative breadth of margins since 2020. before that 2008 these are the magnitude of declines we're seeing in negative revisions >> narrow softening, compression would be negative on a micro level. isn't that exactly what you want to see in an inflationary environment, companies finally giving up the ghost? >> the question is, what are you going to pay for that? if you have earnings rolling over, no earnings growth this year, is my anticipation and margins are coming down. that is likely to lead more negative revisions it's hard to see the equity market rising in an environment where earnings are getting cut that's the biggest concern the thing is we're starting with

fourth quarter earnings season really beginning, big reporting stepping up tomorrow you have the financials. we're looking for in anticipation of no earnings growth this year, year over year we got 8% revenue growth and you've got margins compressing for the quarter by almost 80 basis points communication shortstop services, earnings down, margin down by 500 basis points, technology down, and it's hard to see valuations expanding when earnings are rolling over. >> and that's without an actual economic recession what happens if there's an economic recession we ask you this every time you come on, but parts of the market are signaling we could get one, the ten-year treasury yield spread, the fact it's so inverted right now. >> the big debate among fund managers is the hard versus soft landing scenario the market is pricing the soft landing. what's not given a lot of focus

or market is not pricing the scenario of hard landing earnings would fall by 11% earnings down 11%, you see the market go down 20% not the baseline forecast but that is the magnitude of decline that you would see largely driven by lower earnings and probably a decline in the multiple as well market's trading at 85% percentile it's very expensive. 18 times earnings. >> you mentioned china as an upside risk. there's a -- been a lot of movement in the kweb year-to-date is there signs fresh money would go in to result on the upside? you know you're u.s. equity. >> the best absolute return is probably going to come out of china relative to the united states and the u.s. equity market a risk-adjusted basis, the u.s. market looks similarly from a sharp return more upside there. rate of change is greater, the

economy is reopening more of a tailwind economically speaking margins as well. and the earnings growth, reopening the economy. but there's a lot of externalities in terms of geopolitics, the u.s. in terms of visibility gives you similar risk adjusted return. >> is the market still overvalued right now, where do you see value? >> health care health care tends to do well in an environment that is decelerating where inflation comes lower. medical devices, pharmaceuticals tend to do well when inflation is coming down that would be an opportunity set. there's not a lot of value generally speaking because everything is elevated in terms of the valuations. that would be one area to focus on one area that's sort of less interactive is you see large numbers of big tech cap companies which had tremendous revenue growth for decades they were growing at 18%, compound annual revenue growth for a decade the rest of the market is five three times faster revenue growth that's why they became so significant. that incremental revenue growth

is diminished. it's a little higher, maybe 9%, looking to 2024, the rest of the market maybe 7%, if you look at 2024 so, that extreme premium has come out i think that's - >> i know, but how do you approach that then, david? you mentioned the multiples are down the growth rates are down, but many companies are embarking, it would seem, cost discipline for the first time is there an opportunity there or something you just got to say, you know what, i don't even want to talk about it until '24 >> from a portfolio point of view, you should index the large portfolios if the focus is to do that in terms of the companies, the business models are great. valuations are reset from seven times enterprise values to four. that's been a big reset. the valuation is market weight, if you will, at this level from technology, a lot of the areas we think of in that context. >> to focus on that a little

more, we've been having this debate on our air with different guests in recent weeks and the fact the mega cap tech companies have fallen out of favor, is this now a situation, this rotation out of them, it lasts, it's persistent and is going to be something that can still drive the market higher, eventually, eventually, even if you see those names not participating? >> what you is a dichotomy mu fuel fund industry is underweight these stocks the hedge fund industry has embraced these in a major way. the largest positions in pretty much every hedge fund portfolio as leading stock it's been their trend. it's worked generally well for a decade and then it is not. does it come out of favor? the expectation is that your mutual funds will probably remain underweight those positions and the hedge funds will continue to embrace those because they have generally been a winning business for a long time it has to do a little bit with the horizon. we see the persistence of these

positions. the hedge funds, we can talk about that, they tend to own what they own quarter after quarter after quarter. i've been looking at this for 20 years. >> they deserve to get paid 2 and 20 for mirroring what the indexes are? >> we can debate about the valuation in the market, we can debate the management fees do they outperform, yes. >> finally, it doesn't sound like you're anywhere near raising your year-end target. >> oh, my. >> what would it take? >> it would take management demonstrating they can maintain their margins. we had a call with a huge number of our corporate clients, and my observation to management was, to the extent as a company you have visibility in your business, and feel some confidence that margins can be maintained, that is a distinguishing feature when most companies have margins coming lower. if you have margin resilience and that would be a reason for

potential less concern about earnings coming down absent that, valuation is extremely high and the earnings are a barometer. >> good stuff. thank you for starting the hour with us, david kostin of goldman sachs. here's our road map. oak mark outperforming the s&p the past year. they'll join us -- depends on which fund you're talking about. they'll join us with their latest buys and sells. the chamber of commerce with their annual state of the business address susan clark will join us on cnbc. and nelson peltz joined us last hour. he discussed his push to get a board seat at disney it's a fight he says he is not going to back down from. "squawk on the street" will be right back >> i'd like to see this company stop running like a matrix and start running like the companies we've been involved in, where they have real ceos of businesses with real p&ls, rl ea cash flows, and really -- and

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not that long ago, according to

the exhibit to the proxy, sort of early november. but mr. peltz actually began discussions with disney in a casual way, but nonetheless, discussions detailed in his proxy in july. and then moved forward from there. seeking a board seat at that time when mr. chapek, bob chapek was the company's ceo, but continuing to push for a board seat even after mr. chapek was fired from that role and replaced by long-time chairman and ceo of disney, bob iger, now back in the ceo role something that mr. peltz said that i've gotten some pushback close to disney relates to his claim that they offered him to be a board observer. take a listen to what he had to say. >> they offered me a board observer yesterday they said, you can be in the meetings, you don't have a vote.

okay and we'd like to hear what you've got to say. that means, they want my input on operations, but they don't want my input on corporate governance that's why they don't want me to have a vote. so that says that they believe even that i have something to add. >> i didn't get a chance to push back during the course of our interview, but people close to disney are disputing that characterization of observer status what i am being told is mr. peltz was offered the same template that was offered in, for example, value act when they came after citi. it's essentially an information-sharing agreement under a nondisclosure agreement as well. the opportunity to meet with management and the board quarterly. but it did not mean that mr. peltz would actually be in the board meetings he would not be in the board meetings you know, morgan, perhaps just sort of a different take on

something from his perspective didn't get a chance to sort of share that with him, but it's kind of important because he seems to say, hey, they want me to be there in a sense, they just don't want me to have a vote they say, no, we did not offer you an opportunity to be in the bo boardroom for board meetings. >> this company is rolling up its sleeves, new old ceo, looking to turn things around again. it almost feels like this whole situation, this proxy fight could become more of a distraction for a company at a time where timing is everything. >> without a doubt bob iger's got a long to-do list we know he's been dealing with some of it a lot is simply around costs a lot is row, any other number of issues he's dealing with, and not to mention in the not too distant future he has to think about his own successor because he's committed to only being two

years. got to get the direct-to-consumer business, the streaming business profitability. there are no shortage of tasks. >> how important is successor to snelts. >> in his white paper he makes note of it saying they have not done a good job with succession. chapek was the chosen successor of iger. that did not work off. iger, as we know, put off his own retirement many, many times through the course of his long tenure at disney by the way, again, another area that the two sides disagree on is total shareholder return with disney saying, hey, that's not true at all. under iger we had significant -- i don't have the numbers let's stick with this and bring in luke capital's brian gold and joins us here on the set alan, good to have you. >> good to be here. >> i assume you had a chance to review some of peltz's white paper. i'm skcurious, there are a coup

of damning pages in particular, the one i come back to is -- what is it page 14, i think he goes through their financial performance and all the different disappointments. what do you make of his argument >> well, it's been a tough time in the media business as the linear business is declining and the streaming business is growing. and the companies have been investing. frankly, there's been too much investment in streaming by the whole industry yes, disney's results were poor. that's one of the reasons chapek is gone. the timing is interesting. now, i realize you got to make your move in january if you want to get into this year's proxy. so, that's why he moved now, so quickly. but bob iger probably has done the best job of any media ceo for the last couple of decades in terms of the tsr, what you were talking about, they start it from when bob iger was president and coo and joined the

board, which i think was 2000, not when he took over in 2005. so, it includes some of the dark days, the end of the michael eisner era i haven't run the numbers, but i'm sure if you start the tsr -- >> i've got it for you because it was in the press release. from september '05 when iger took over as ceo to february of 2020 when he stepped down, total shareholder returns, 554%. the s&p was 244% >> yeah. i mean, bob did a good job listen, the fox acquisition may have been too expensive. we'll see. if you look at the pixar, marvel and lucas acquisitions and you look at the profits that those acquisitions have done, i'm sure they made way more on those three acquisitions than they potentially will have lost on fox. and i saw part of nelson's interview. he's saying they lost $50 billion on fox if you go through his whitepaper, after you knock out the rsns and other, i think he

has a net cost of $54 billion on fox. it's not worth $4 billion today. >> your point being they sold sky at a premium and the rsns, thankfully for them, they had to divest as a result of the antitrust review they got it at a good time there as well. >> yeah. i mean, bob iger, it's just sort of surprising to see what's happening. we have to see what bob does right now. streaming is a tough business. what changes is he going to make he's always looking for where the consumer is going, creativity, embracing technology the big issue is going to be hulu, i think. >> that's what i was just going to ask you what happens to hulu >> so, the put call with comcast, your parent company, is next january it's at the greater of $27.5 billion or fair market value so, for comcast one-third interest, we're talking $9 billion check. nelson wants the company to delever and he also wants him to delever and wants a return of

dividend of 2025 there's no way you can do hulu and hit those objectives he's looking for. i'm sure the board would look at it pretty closely anyway, but now you've got nelson peltz, whether he's on the board or not on the board, looking over their shoulder when they make that decision and hulu's a tough one because it isn't, quote, unquote, the flywheel of disney fx does some great programming, but i'm not sure a "dopesick" helps the theme parks or the other areas of disney. so, the tough decision for the board is going to be, do we stay focused on our core entertainment businesses, or franchises, which are phenomenal, and sports i know the espn issue will come up, too. but bob follows the consumer you know, the two areas that are working are sports and news on general tv everyone loves sports. i'd be hard pressed to see them getting out of sports. dan lobe tried to push for that and chapek with pushback there. >> it's a timeless disney

debate you mentioned parks, as we await the president in a moment, you mentioned parks lost masses in dtc. what was the alternative for disney than to charge as much as they possibly could when marks reopened >> i think they overdid it on the parks. i think parks overearned the profit margins, as high as they've been since 1990 and structurally it's a little different business the up 30% on per capita spending, you know, you got to balance the short-term with the long-term. disney has a strong financial position they have a strong balance sheet. christine did a great job getting cash for the company you didn't have to charge this much if it hurts -- if it's a brand withdrawal versus a brand deposit. if you hurt the image of disney, and bob's already cut back a little bit of that >> thanks for being here appreciate it. >> thank you >> we're getting a check on american airlines, which is flying higher after raising its q4 guidance. our phil lebeau has the details.

phil >> morgan, it's not a surprise that american shares are moving higher or they raised their guidance, it's the level to which they raised their guidance this morning look at the earnings per share on the lower end they're expecting them now to come in more than double what the previous guidance was. when you look at total revenue per available seat mile, a nice bump higher. operating margin expected to be double what the company was telling us back in october here's ceo talking with us this morning about how strong the business is right now and what the outlook is >> fourth quarter is really strong we've only had a couple weeks here of bookings in 2023 but we like what we see. we're entering a period where profitability means free cash flow profitability means that we can deleverage >> so, you're looking at american airlines reporting its q4 results in a couple of weeks. that's when we will get the 2023 guidance all of the airline stocks moving higher today i think everyone is saying what

we're seeing from american will likely see repeated tomorrow when we hear the q4 results from delta. speaking of delta, don't forget we have another exclusive tomorrow morning on "squawk on the street." we will be talking with ceo bastian. we'll get the results. we'll get his perspective, guys, on just how strong the business is in the first quarter, which is traditionally one of the slower times of year for the airline industry >> we're looking forward to that phil lebeau, thank you earnings season, as you just heard, it's arrived. we're going to get a wave of results from the financials, including jpmorgan, wells fargo, citigroup, and blackrock tune in tomorrow at 9:00 a.m. eastern to hear chairman and ceo larry fink break down the numbers on a first on cnbc 'rba ithrvw. wee ckn ree.

welcome back to "squawk on the street." we have major averages higher. we'll turn back to the broader markets. this morning cpi coming in at the lowest level since 2021. as the fed continues to try to tackle inflation, how should investors be positioned? our next guest's fund

outperforming the s&p by six percentage points, with adobe and oracle, and citigroup and diamondback energy let's bring in oakmark portfolio manager bill great to have you here we're referencing the oakmark fund let's break down how you're thinking about the positioning of that fund in this calendar year and how it speaks to your expectations on the market more broadly. >> i would say the volatile market last year created a lot of position for us to reposition the fund at oakmark, we're generally selling what's performed pretty well and recycling that money into the names that have been lag laggards for example, we sold out our diamondback energy position. still think it's a very good company, but it had performed a little better than our other oil names. we thought we were getting more non-earning assets in apache,

conoco and eog, which we continue to own. we recycled that money into magna auto parts, single different p stock, down from $100 to about a $60 level. we think they're underearning today because of supply chain problems but we're paying about seven times trend earnings for it a little unusual as the market is worried about going into a recession that almost anything in the auto chain is underearning today >> yeah. it got my attention, too, especially on a day where we did get this inflation print and we are seeing not only used vehicle but new vehicle prices start to come off as well is that a concern or, no, it's the fact we've had supply chain bottle necks to get things going next makes magna more attractive >> our focus is on it's been years since auto sales have kept up with deappreciation in the auto park, so the average age of the fleet on the road continues to increase.

>> you bought adobe and manage two other funds. let's start with adobe, given the fact we've had conversations, including earlier on this show about tech and whether that can be an outperformer at some point in the future or whether we've seen a more structural rotation >> so, adobe is a company we've admired for a really long time they have a great business the stock peaked in november of '21 at about $700. and it had fallen to $400, in line with what we consider overpriced technology names. then they announced this acquisition of figma, $20 billion acquisition and the market cap fell about $45 billion on that announcement so, that put it at a level where we thought on next year's expected earnings that it's

about the same multiple of free cash flow as the s&p 500 and we just think that's too cheap for a company of this quality. >> all right >> on alphabet, which you've owned for many years, i think, obviously not a great year for the stock last year, why do you continue to own it are you a believer they're going to be able to get costs under control in the way that others still question >> well, i think there are two areas to think about costs at alphabet one is the other bets area, which we think of as venture capital investing and believe that the dollars have been well spent there. effectively the value of what they've created has been higher than the cost. and then within search, we're barely paying a double digit multiple for search today. so, yes, we think costs are still a little bit bloated there. but even if they don't attack the cost structure, i still think it's a pretty cheap stock. >> are you watching this chat gpt open ai notion that they, in order to match whatever

microsoft might have going, would increase their capex cost and erode margins down the road? >> we think what alphabet has got in artificial intelligence is a generation ahead of what you're seeing with chat on -- that's currently come out that everybody is so intrigued by. >> the lambda product or -- >> i'm sorry >> the lamda product - >> i don't know the name of the product. >> ally and capital one, we've seen downgrades on fears of delinquencies and we're seeing people a little bit more late on their bills, at least on a month basis. are you worried about that >> we've had a couple of really good years of credit costs for the consumer finance companies they're selling below tangible book value selling at about six times earnings excess cash flow going to repurchase stock so, i would say, no, we're not unusually worried about it and i think something to pay

attention to is this recession could be a lot different than others given how strong demand is for employment in the bottom qu quart i'll of workers and that's where you get charge-offs for companies like capital and people pay off their car loans. >> thoughts on this news, this proxy battle now brewing with trian? >> we bought disney after the stock price was cut in half. it was a new holding for us last year our belief is that at current prices, you get maybe three-quarters of the enterprise value in just the theme parks. almost all the attention is focused on the other elements of disney but we think we've got pretty good downside protection there and we would agree that the cost structure is bloated at disney i think if you look at a comparison versus its peer set, their expenses look high and whether bob iger is the one to take care of that or nelson peltz is, we don't think it

really is going to matter who's on the bother. we think -- we think the people at disney are aware that costs need to come down. >> would you support peltz, though >> we have in other cases, david, but we have not had an opportunity to talk yet to peltz or disney. we're happy to listen to what both sides have to say >> all right thanks for joining us at post 9. >> thank you. let's get a check on some s&p gainers. american airlines leading the charge on their new guidance as they do raise for the quarter. they see revenue up 16 to 17 versus request 4 of '19 and some other travel names following suit ckn o. ba itw if your company actually practices the values that it posts about, then, yeah... you're on team earth. municipal bonds don't usually get the media coverage the stock market does. in fact, most people don't find them all that exciting.

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today marks the annual chamber of commerce state of business address our kayla is live on the scene with a special guest >> good morning, carl. we are joined by susan clark, ceo of the chamber of commerce,

first on cnbc before that speech thank you for being here we appreciate it >> thank you >> we're expecting to hear from the president in just a few moments, but walk us through the state of the economy right now the majority of your members say they're pursuing layoffs in this year but we've seen inflation slow for six months so, is there a soft landing afoot? >> interesting question. what we hear from our businesses, small and large across the country be, is the state of their own business is strong, but they worry the economy is fragile and they're in a state of almost despair about the lack of national leadership in addressing it. >> so, when do you see a recession? when does your membership see a recession happening? >> we have a committee of chief economists that come together and what they say is a slow, small recession in the middle of 2023, but we believe there are things we could do to help avoid it or lessen the impact. >> what are those things that washington could be doing? >> we'll talk about this in the speech in a few minutes. there are things that are

inflationary, like fuel prices we need more domestic energy production like the worker shortage, we need to secure our border and increase immigration that drives prices up in the labor market we need to fix it. there is permitting reform if we could get some of this building done, because if it didn't take seven to ten years to get something approved, we could get some building done there are goth policies that could help. >> that would take a functional congress to actually pass some of those laws. do you think washington will throw a wrench into this fragile economy with a debt ceiling fight in a few months' time? >> i don't think they won't. this isn't a time to play chicken with our economy it's right to think about the level of debt and spending, but now in a way to outrage headlines. i think responsible people in government, a strong speaker and i think they'll do the right thing. >> goldman sachs says it will be a repeat of 2011 certainly that did not play out well for the economy morgan, i believe you have a question here? >> i do, kayla

thank you. it's great to have you on the show just to dig a little more into this malstrom that is congressional gridlock, or the potential for it, there's the debt ceiling, there's potential for government shutdown, also this possibility of, and i'm hearing this from a number of analysts, a full year continuing resolution when it comes to next year's budget. we're certainly see defense stocks sell off on that possibility as well. is gridlock in this particular case of any kind going to be good for businesses that are trying to navigate all of these other uncertainties? okay i'm sorry. president biden is just taking the podium we're going to go there first. >> would you please have a seat. national cathedral, chapter 11 good morning today we've got some good news good news about the economy. for the sixth month in a row, inflation has come down. measured over the last 12 months, it has fallen 6.5 --

2.65%. that's down from 7.1% the month before it's down from 9.1% this summer. inflation is now at its lowest level since october of 2021. we look at the -- just the last three months, we see that inflation fell to 1.8% on an annualized basis it's down from more than 11% the first three months of last year. so, the data is clear, even though inflation is high and major economies around the world, it's coming down in america month after month, giving families some real breathing room the big reason is falling gas prices my administration took action to get oil onto the market and bring down prices. now gas is down more than $1.70 from its peak. that adds up to a family -- a typical family with two vehicles to a savings of $180 a month every single month that stays in their pocket instead of being

spent at the pump. food inflation is slowing as well last month we saw the smallest increase in food prices in almost two years and much of that increase was due to the avian flu outbreak, which has driven up the egg prices around the united states. it's not just gas and food prices, though we look at what economists call core inflation, which takes out energy and food, we see welcome news as well core inflation is down to the lowest level in a year over the past three months, core inflation has come down to 3% on an annualized basis. that's down from more than 6% at the beginning of 2022. the cost of goods is actually falling as prices from everything from computers to used cars are coming down as well and inflation and the core services is moderating as well you know, as inflation is coming down, take home pay for workers is going up. workers' wages are higher now than they were seven months ago,

adjusted for inflation wages for lower income and middle income workers have gone up even more it all adds up to a real break for consumers, real breathing room for families, and more proof that my economic plan is working. when i came to office almost two years ago, the economist flat on its back, as you'll remember millions of people lost their job through no fault of their own. millions, millions who saw their hours and paychecks cut. hundreds of thousands of small businesses permanently closed their doors. people were hurting badly. that's what we inherited the pandemic was raging and the economy was reeling. we acted decisively to put in place a new strategy that would build a -- would rescue the economy from the pandemic downturn at the same time, we lay the foundation for a stronger, more resilient economy for decades to come an economy that grows from the bottom up to the middle out.

two years in, it's clear, clearer than ever, my economic plan is actually working here's what we learned just last week unemployment is the lowest it's been in 50 years i'll say that again. the lowest unemployment rate in half a century my first two years in office were the two strongest years for job growth on record we created nearly 11 million jobs, including 750,000 manufacturing jobs and there were two of the strongest years ever for small business creation as well. and today, unemployment rate is near record lows for blacks and hispanic workers, near record lows it's the lowest ever on record for people with disabilities we're seeing american families breathe a little easier. more americans have health insurance than they did ever in our history. fewer families are facing foreclosures today than before

the pandemic and we still have more work to do, though we're clearly moving in the right direction. and there are -- there's more breathing room in store for american workers and families. starting last week, as of january 1, a month's supply of insulin is capped at $35 for seniors on medicare. some were paying hundreds a month for insulin. starting last week, if big pharma raises prices faster than inflation they'll pay big penalties. starting last week, americans can get tax credits when they install energy efficient appliances in their homes or when they buy electric vehicles. these are all pieces of that big law we passed last year. now they're kicking in and americans are starting to feel the benefits in their everyday lives. that's not all we're seeing historic investments in american

manufacturing turning into new factories and new jobs from arizona, ohio, georgia, new york, companies have announced nearly $300 billion in manufacturing investments. here in the united states since i became president instead of exporting jobs like we did for decades, we're now creating jobs and exporting product. creating jobs and exporting product, that's the idea now the house has elected a new speaker. i called and congratulated him and ready to work with him for the congress to make progress for the american people like many americans, i was disappointed that the very first bill the republicans in the house of representatives passed would help healthy people and big corporations cheat on their taxes at the expense of ordinary and middle class taxpayers and it would add $114 billion to the deficit. their very first bill. house republicans campaigned on inflation. they didn't say if elected their

plan was to make inflation worse. plus, house republicans introduced another bill. blocking action that would help lower gas prices and help consumers. on top of that, house republicans are preparing to vote on a national sales tax bill national sales tax that's a great idea. it would raise taxes on the middle class by taxing thousands of everyday items from groceries to gas while cutting taxes for the wealthiest americans if i'm not mistaken, what they've introduced, it would also totally eliminate the irs feels good except all going to be sales tax. go home and tell your moms they're going to be really excited about that come on. is this how the house republicans are starting a new term cutting taxes for billionaires, raising taxes for working families, making inflation worse? let me be very clear if any of these bills make it to my desk, i will veto them.

i will flat veto them. i'm ready to work with republicans. but not this kind of stuff they try to cut social security and medicare, which americans have been paying into every paycheck since they got their first paycheck i'll use my veto pen to stop that as well but if republicans want to work together on real solutions to lower inflation, create more jobs, build an economy that works for everyone, i'm ready. let me close with this today's inflation numbers are good news. good news about our economy. we have more work to do. we're on the right track we're seeing bright spots across the country where great things are happening. roads and bridges are being built, factories are coming online people back to work again, families breathing a little easier that's why i can honestly say, and you haveheard me say it before and i mean it from the bottom of my heart, i have never been more optimist, about america's future than today. this is the united states of

america. there's nothing, nothing beyond our capacity if we work together so god bless you all, and may god protect our troops >> classified material, what were you thinking? >> let me -- i'm going to get a chance to speak on this god willing soon as i said earlier this week, and by the way, my corvette is in a locked garage. so it's not like it's sitting in the street but anyway - >> a locked garage >> as well as my corvette. as i said earlier this week, people know i take classified documents and classified material seriously i also said we're cooperating fully and completely with the justice department's review. as part of that process, my lawyers reviewed other places where documents from my time as vice president were stored and they finished the review last

night. they discovered a small number of documents of classified markings in storage areas and file cabinets in my home and my personal library this was done in the case of the biden penn center, the department of justice was immediately, as was done, the department of justice was immediately notified and the lawyers arranged for the department of justice to take possess of the documents so you're going to see all of this unfold. i'm confident -- thank you thank you. >> that is president biden tackling a range of topics right there, including the discovery and disclosure of more classified documents in terms of what we're focused

on here, a victory lap by the president on inflation easing, the fact we got the cpi number this morning that showed a sixth straight month of deceleration in terms of price increases that have been near multi-decade highs. talking about american families breathing easier, clearly moving in the right direction, the president said, and saying that his administration's economic plan is working. so we're going to go back to d.c. and specifically to our own kayla tausche and to suzanne clark, chamber of commerce president and ceo. i want to get your response to the president's comments and specifically from a business community standpoint, that economic plan by this administration is in fact working. >> well, it's disappointing to hear the president not give the business any credit for what's happening in the economy and to focus on the jobs when they're not the problem. finding enough qualified workers

is a problem, permitting is a problem. we can't build any of the things we funded in the infrastructure act or the chips act without reforming the permitting process. he went after house republicans for some messaging sound bites and there was plenty of messaging sound bites in his comments as well >> you earlier, suzanne, talked about washington pursuing progress because there's a great speaker. you mentioned that, kevin mccarthy he has asked your board reportedly to fire you, to replace you. when was the last time you met have you mended fences how are you going to worth together >> i said america needs a strong speaker. i think kevin mccarthy is be a strong speaker he did not ask my board to fire me instead, i have renewed my contract we have a strong speaker, a strong chamber ceo and we're going to work with house republicans and house leadership to get things done there are plenty of pro-business champions in the congress that are fed up and want to get things done. >> what did the speaker fight tell you about their willingness

to compromise, about how governing will work under the 118th? >> you know, i think we'reler all waiting to see what happens. the truth is that was a speaker who survived a 15-round fight. it shows that he's strong. at the end of the day, maybe underreported, he had 216 votes, which is exactly what nancy pelosi had and no one was calling her weak i thin we can have some real progress here. >> meanwhile, the biden administration taking matters d, releasing an order that would essentially outlaw noncompete agreements later this year also the president writing in the "wall street journal" that big technology companies, specifically, need to be held to account first on noncompetes the chamber has been very critical on that will you launch a lawsuit. >> if we have to we will submit our comments, try to make it better, right we'll try to make the agency see the light of day this is an important role that house republicans at the u.s.

congress can fulfill, which is oversight of the rogue agencies. overregulation has gone amuck. i'll going to say in the speak, government has rules it has to play, that it's not playing and it's doing things it shouldn't be doing we need more government on border security, immigration, reasons you have a federal government, and less government on roles and responsibilities they're making up. >> finally, president biden is expected to decide in the coming weeks whether in fact he will run for president again in 2024. the chamber supported 23 democrats in the 2020 election have you decided which candidates, which party the chamber will throw its weight behind >> we never get involved in the presidential there's one president in the united states and we have to work with him or her no matter who they are one quick thing going back to your technology question this is a shining star of the u.s. economy it drives global growth, this industry so if we want to look at individual proposals on how to make big tech better, what to do on data privacy, great, but just

throwing an entiredry under the bus, our adversaries have to be laughing at us >> we'll see how congress decides to move forward if they move forward on that issue suzanne clark is the ceo of the chamber of commerce. back to you at post nine >> kayla tausche, thank you. the so-called condo king of miami is launching an ultra luxury condo project in spite of a housing market that's grinding to a halt. diana olick has more hi, diana. >> hi, morgan. that's rights. i'm standing on the last piece of undeveloped land on fisher island just off the coast of miami beach. this island is a 216-acre ultra exclusive community only accessible by ferry or yacht and only accessible to residents, their guests and guests of the small luxury hotel here and if you're a reporter doing a story on the last development, which is from george perez, behind the ten-story, 50-unit project with a price tag of $1.2 billion.

units start at $15 million and the project includes a $90 million, 15,000 square foot penthouse and a $55 million ground floor villa with a half acre backyard. it has its own yacht slip and sales started just last month. >> almost 30% of the units are spoken for contracts have gone out for over $300 million, and we haven't really done any marketing. nevertheless, should the market slow down a little bit, we're in a fortunate position >> pending sales of miami condos in the $5 million plus range were down 89% year over year in december, according to jonathan miller of miller samuel, but miller notes miami inventory is down about 60% from prepandemic and that changes the pricing picture. in fact, sales of $50 million plus condos in the u.s. have actually spiked in the last two years. >> we're thinking that interest

rates and inflation has pretty much peaked. we're going to have a rough, my opinion, one year to a year and a half, two years. and we're ready to weather that storm. >> now, if perez does get $90 million for that condo, it will not only be the most expensive sold here on fisher island but in all of south florida. the last condo that sold here on the island last year sold for $40 million. back to you guys >> diana, thank you. diana olick. >> as we wrap things up on "squawk on the street," let me come to you. we haven't talked much about the broader market this morning, the response to cpi. got the s&p up, but nasdaq down a bit. some of the mega cap tech names such as apple down about .5% >> in terms of what's leading the charge in the s&p, energy, communication services disney, which is the top performer in the dow as well also industrials, financials, we

get bank earnings tomorrow morning. treasury yields came off pretty aggressively on the heels of that cpi report. something to keep an eye on, too. the ten-year back towards maybe a one-month low on the yield >> yeah, and we will be right here tomorrow with those bank earnings as morgan just said that going to do it for "squawk on the street. "tech check" starts now. >> good thursday morning welcome to "tech check." i'm carl quintanilla with deirdre bosa and jon fortt today, proxies, outperformance nelson peltz wants to restore the magic to disney. later, cpi prints in line with estimates, and growth stocks to consider this morning. we'll talk to the ceo of one of those names, box, the rare tech outperformer in 2020 with aaron levie joining us on set. >> let's get a quick check on markets, coming right in line with expectations, and we're off highs. the nasdaq is underperformer