on the way as well. debt ceiling drama the nation expected to take it to the limit treasury department expected to take action which pushes the date to june we have time netflix on deck. expected to report as the stock mounted a strong comeback for investors. it is thursday, january 19th "squawk box" begins right now. good morning welcome to "squawk box" here on cnbc we are live from the world economic forum in davos, switzerland. i'm rebecca quick along with joe kernen and andrew ross sorkin. we have another huge round of interviews

we start with jamie dimon. we will talk about the markets and fears about recession. that is a few moments away we will have an interview with joe manchin. senator from west virginia and at 7:00, we have an interview with jon moeller of p&g. recession fears after yesterday's session. dow off 600 points decline of 1.8%. s&p down by 1.5% nasdaq off by 1.25% there is no bounce back to be seen red arrows again dow futures are down 200 points. s&p figutures down 22 nasdaq down 25 >> this didn't take long

yesterday on the data, market was trading higher traders are fickle we have cool inflation data and now worried about recession. >> there is no cinderella story. >> the dollar and bond market which we will look at right now. >> let's see what is happening with the treasuries. 10-year treasury at 3.36 the 2-year treasury is just 4% at 4.065%. >> telegraphing a slowdown i'll be right, sorkin, i am. the fed has gone too far. >> i'm in the camp that they may keep going that's why both answers are not good >> yeah. as we are seeing the economic calendar is busy we have so much going on in

davos. the numbers don't lie. they are the most important thing. 8:30 a.m. with the read on labor market with the weekly jobless claims expecting 215,000. we will get december housing starts that number expected to fall by 4.7% we will bring you the news as it happens. fed speak in the session today. fed vice chair lael brainard is delivering a speech at 1:15 p.m. you can imagine the investors and traders will hang on every word trying to divine something from it all. here we go again lawmakers facing a debt ceiling showdown as the country hits nearly $31.5 trillion. not a typo borrowing limit. the treasury expected to keep paying the bills with extraordinary measures without raising the debt ceiling, they could be on the

verge of default if the extraordinary measures last until june, then i hesitate to say i'm not worried about t. -- about it we have seen this movie so many times. doesn't the wolf come eventually >> and nobody licestens? >> you hope that it will be han handled. i will tell you one thing. it is not resolved until the deadline. >> we have done it before. >> 120% debt-to-gdp. the people that don't want to do it are saying they are doing it for the good of the country. >> what do you think that number looks like >> how many? >> how many people in the house will make that >> how many do they need >> it has to be democrats and republicans coming together. >> the 20 guys aren't factoring

in this? >> here is the question. if the speaker brings it to the house floor and democrats sign off, how quickly do those 10 or 20 people turn on the speaker? all you need is one of them to call for a vote. if ithe can't get the votes >> pwe have to go. we have a big guest coming up jamie sdrdimon will join us nex and talk about recession fears we're in dosav, switzerland. >> it's cold we'll be right back. >> announcer: this cnbc program is sponsored by baird. visit bairddifference.com. 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.

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welcome back to ""squawk box. we are live in davos, switzerland. jamie dimon stated we are headed for a hurricane. those statements from last year. despite the bank beating earnings last quarter, mr. dimon saying a mild recession late this year is still his base case let's talk to the man himself. our big interview of the morning. jamie dimon. chairman and ceo of jpmorgan chase. help us understand what happened between then and now >> basically nothing

part of the storm cloud hit. rates went higher than people thought. stock market down 20%. ipo market disappeared the economy, of course, we all talk about it. it is like the weather i hate guessing about that we should have humility. the real issue for the world is russia and war and ukraine and energy and trade hopefully it will mitigate and go away. as a risk manager, you have to prepare. >> we were debating what happened yesterday in terms of the markets. >> the markets have been wrong, too. >> for a while >> the way we run the company is to serve clients day in and day out through thick or thin. i know there will be recessions. i don't spend that much time worrying about it. i worry about public policy that damages american growth. not about what the weather is like

i don't want a recession it hurts average americans i'm not for it, but i have to prepare for it >> there are businesses here and if they need to raise more capital and if they have to call you for that what are you telling them? >> i think any business, large or small, should prepare for a bunch of eventualities and run the business and serve the clients. not worry about profit margins are you building products and services can you handle input and output? >> a global conflict would be bad for jpmorgan chase and for all of us. we're in davos it is like the russia problem and people have on the back burner oh, yeah dictators will do what dictators will do. we still have how many nuclear weapons? russia has how many nuclear weapons? we don't know if that is a possibility. >> i agree >> for every panel on climate

change, there isn't a panel. >> the only real future is how this plays out the russia/ukraine and i read killing kids and blackmail. this could be an inflection point for the western world for years. do we get our act together to help ukraine and negotiate trade relations with china that is the issue. the other stuff is the weather >> do you like at this as a dress rehearsal for whatever our relationship is with china in the future >> americans have to understand $75,000 gdp per person they import 11 tmillion barrels day. i want them to do well for the

people we have a competitive relationship it is not adversary. i'm very happy we are talking to them now >> they say they are opening up. that is the message you hear in davos. is that a head fake? is it real >> they have to. >> for the long term >> for themselves. they need to grow their economy and lift up their people and c compete in the world the warm up to the extent the western world -- trade will not go away. it will be restructuring of two types. anything relating to national security it is different for every country. semiconductors secure, safe, cheap energy and food then we think unfair competition. that should be negotiated. yes, of course, america should have done this sooner. >> even zero covid they didn't get rid of zero covid because of the protests

because people were locked indoors. they did it because gdp was half what they wanted they need to keep growing economically a war will not help. >> i was talking to an american ceo who had a meeting with the deputy minister from china making the case to come back to china and make significant investment when those american ceos call and say give me your advice because they are not sure. it is a long-term investment it only works if you are there for ten years or more. >> obviously it is a hard question i think china is going to be large, civilized nation for years. if you think long term, you should if you think about politics, it is garnered by the united states government the american government has to

set policies and guidelines. i think people may wait to see what happens with the trade relationships. for those of us there, we are still doing business there rationally under american law. i'm a patriot. i'll salute what the american government tells me to do. you should look at both and be thoughtful about it. not have a knee jerk reaction. >> jamie, the debt ceiling is one of the things on the list that you worry about >> we should never question the credit worthiness of the united states government. that is sancrosanct. questioning it is the wrong thing to do. that is part of the financial structure of the world and this is not something you should play games with at all. >> there is a reason we can sell our debt we're at 120% now debt-to-gdp. we are lucky and trusted >> america should understand the

american financial system is the crux of the financial system of the world. >> talk about selling our debt the price at which we sell our debt is a big usissue. i know you don't like to mind read the future of the economy the other business is mind reading what jay powell will do because it impacts the u.s. economy and everywhere else. >> i point out that everyone who forecasts this has been wrong. including the fed. >> the recession piece or what they should do >> inflation, yield curves whole thing. be prepared for all of it. if x happens and y happens i think rates will go higher than 5%. that's my own view i think there is a lot of underlining inflation that will not go away quickly. the benefit of china slowing down i think oil and gas will go up in the next ten years. we are not investing enough to

keep oil and gas low you will see the oil prices. i think we should see. people left the work force china isn't deflationary i think we have to have more than that. if we have a mild recession and rates go 6%, we will be fine >> we might have a mild recession at 4%. at 6%, it is not a mild recession. >> whatever you put on the yield curve, i can make a call and tell you what it would do to us and how we deal with it. we are not betting the company against the interest rates i think they will be higher, personally. >> a different question. not what you think about the company, but you have a lot of high net worth clients given what you think, what are you telling them >> i don't give financial advice for a lot of reasons. >> what is the dimon family

doing? >> i own a lot of jpmorgan chase. >> jpmorgan chase and more bitcoin? basically? >> what is bitcoin i'm more jpmorgan chase. >> much more jpmorgan chase. >> you talk about problem little -- probabilities. >> some of the ones are bad. i just say it is really small. if it happens, what does it mean to sus we have to survive we do the stress test. we do 100 a week >> there are certain things you can't survive. you can't survive a nuclear event. >> war would be a whole different thing. >> i have a tiny one not something you are happy about. the issue about frank. the business you bought that was now fraud. what was the lesson of that? >> there are always lessons.

we always will make mistakes it is okay to make mistakes. i don't want our people to be afraid to make a mistake it is a bad way to run a business. >> you can make a small mistake. that was a small mistake you can't make big -- >> we made big mistakes sometimes. >> do you have an opinion on goldman? if david called you and said jamie, i always admired you. could you just give me a little bit of advice? >> david and i are friends i know what they are going through. i told david he did a good job doing better than us on investment banking this year my hat's off to him. i don't know the consumer side of that. >> he mentioned bitcoin. you said you didn't know what we were talking we have some crypto conversation with you >> all that is a waste of time why you waste any breath is

beyond me. >> you think it is going to zero and is fake? >> bitcoin is a hyped up fraud it's a pet rock. >> you are back to that? >> yes. >> what do you make of blackrock and other firms investing? >> that's different. blockchain is a technology ledger system that we use to move information we used it to do overnight -- intraday we used it to move money that is a ledger that's a technology ledger we think it will be deployable remember, we were talking about that for 12 years and very little has been done. >> there are tokens that i agree with you bitcoin. it has all of the characteristics of store value it is scarce 21million. >> how do you know everyone says that maybe it will get to 21 million

and hitoshi's picture will come up and laugh at you? >> what is your reaction to the failure of ftx and all that? you know you have seen lots of failures over the years. >> i'm not surprised at all. i called it a decentralized ponzi scheme >> you have a lot of clients >> you have seen the analysis of tether and lack of disclosures it is outrageous regula regulators should have stopped this long ago. >> ftx is a decentralized ponzi scheme and crypto is a ponzi scheme madoff created options >> it doesn't do anything. it's a pet rock. you can own it all you want.

>> it's billions of dollars. >> i don't care about bitcoin. we should drop the subject. >> what about the universal proxy situation? >> you know, universal proxy a bigger issue here. this is something regulators should be thoughtful about i think the numbers are right. 1996 7,000 public companies 4,500 today. now private equity i'm not against private equity from 1,000 companies but to go to 10,000. we are dropping with regulation and compliance now you have the universal proxy. someone can get a proxy with one vote that you own for one second do you want boards to be dominated by special interest groups that is a huge mistake a lot of companies won't go public you could argue it is a good thing. private markets are good it is a policy matter.

this is another mistake that will drive companies to private market >> you think about esg a lot and stak stakeholders does that increase from here or decrease >> increase from here. the first i heard about this is davos five or seven years ago. no one is talking about it in the united states and now it is everywhere climate is a series issue that should be taken seriously. we are not doing a good job at it it is not banks and gas companies. we need oil and gas. >> how long? >> 50 years. you know, 100 million barrels a day used by the world to heat and fuel >> they want to end it now, jamie. you can't get the two to come together >> then you have a calamity. a global depression. you need transition. big oil guys are doing the most investing in the future of renewables and clean methane

that is reducing co2 china is three times us. if you don't have global deals, it will not work the politicians say the best thing is carbon tax. we can't do that we say how important this is you want to fix climate, but not fix carbon tax we need permitting i was speaking to an oil ceo it takes ten years in the north sea to build turbines. ten years. you know what it does to the cost of capital? it is not the years, but also the litigation you can't get things done. we are creating a huge problem higher oil and gas prices and more use we can't get the grid fixed. we can't get hydro power to massachusetts. they won't improve it. >> we have to plug our evs into something. >> we need a plan that is

thoughtful. >> will you co-finance is that realistic? we were talking about oliver stone earlier. he has his film out here. >> i don't know if it will happen in the united states. if it did, we would. >> you don't think so because? >> it will be hard in the united states it is the permitting the litigation >> if it starts today -- it's probably 20 years from start to finish >> if you started today, you could get it done quickly. >> five years. >> how long is permitting in. >> that's why it will never happen >> goldman will be right with $300 a barrel. >> you have a good chance oil prices will go up. >> finally, were you one of the original back to work folks. it seems people are finally getting back to work what do you think? >> we have a little bit. we have a lot of people back

fully and some hybrid. it is okay it is better for the company and clients and not just for the individual we shouldn't feed the squeaky wheel. you can go write your book and work at home there are certain jobs that you can't work from home it is amazing how much you learn onn the road i'm learning in davos. >> you are not promoting anyone who is working from home >> we're going back to work. >> i wouldn't want to work there. you just told them >> it doesn't work for young kids or spontaneity or management it works if you are researching and you have to post-it notes and coding there are jobs where it is reasonable it is reason aable to help women

we learned the burden on women parent care and primary care is enormous modify your company to help women stay home a little be thoughtful about it take a deep breath sort it out. >> jamie dimon, thank you. always fun to see you. i appreciate it. >> thank you when we come back, senator joe manchin traveling from capitol hill to the swiss alps what he says about the upcoming debt ceiling battle in congress. that interview is next technologists in india, and customers all on different systems. you need to pull it together. so you call in ibm and red hat to create an open hybrid cloud platform. now data is available anywhere, securely. and your digital transformation is helping find new ways to unlock energy around the world.

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good morning welcome back to "squawk box" live in davos. recession fears after the drop yesterday in the dow and s&p and we almost saw the 2-year treasury go below 4% yield china is reopening does that mean energy prices start rising again we have been relaxing a bit on inflation. what if inflation comes back and we're in a sharp slowdown? we're back to thing stagflation worries. we could have the worst of both worlds

we think inflation is trending lower. >> we tend to change our minds pretty quickly >> we're informed by the markets. >> every data point is something we're trying to figure out. >> 336 it got down to 3.32% on the 10-year treasury 5.25 >> he thinks, jamie dimon, thinks more than that. in the meantime, members of congress in diavos we spoke with senator joe manchin earlier and asked about his focus here >> energy. >> the message you were telling people >> the i.r.a i never knew the i.r.a. had become so global so quick. people misunderstood they look at the intent. intent of the bill is energy security it was not based around all climate and climate only it is based if the united states

have enough horsepower to run the nation and the next ten years. that is what it is all about >> you say so global how much anger >> the anger is uncertainty. we have never done anything in that piece of legislation saying we are harming this and that our allies are important i have seen with putin we weaponizingi fuel and energy i told president macron when he was in washington. i said, mr. president, not one time did we talk about does this have this effect or this effect. we wanted to make sure the united states of america should have energy security so we don't have to depend on iran or the gulf coast or venezuela. that's what this does. >> you are speaking to your allies here and are they taking

that message the truth is it will make them harder to do business in the united states. it will cost them more >> i don't see that. i'm happy to sit down and talk to you about that. i had the german delegation. they are concerned about the autos. i said why would you be upset because the united states is trying to resurrect itself as a manufacturing powerhouse go ahead, joe. >> i don't want to talk -- you know that. >> it happened >> sometimes a national figure speaking for a lot of people in the country. other times i see you speaking for your constituency in west virginia that might be a little different than a national constituency 40 points? it's a very red state. i've seen you go from hero to go

to hero to goat depending -- sometimes i'm like if it wasn't for joe manchin, this country would be headed to the toilet. >> i heard that. >> then all of a sudden i say who is this guy and how did that ha happen how did $1 trillion be more palatable? >> everything up to that point was spending checks and spend that is not who i am i can't do the bbb i thought it was an overreach. >> a mini bbb. >> nothing about the bbb except we took the best parts we could that we agreed on. these are the things i worked five years with the republicans. republicans tell me all the time, joe, we need more energy i agree. we need more energy. be more snindependent. we need to pay down more debt. this is the first time we pay over $300 billion of debt.

we haven't done that for 30 years. we can't build anything quick enough we have a permit bill and i could not get them to vote for it >> was the permitting necessary to get the renewable >> if you look at the renewable stuff, joe, we have, i think, a responsibility to decarbonize. >> were you misled about the permitting >> i wasn't misled i'm discouraged we didn't work harder to get the votes. i'm discouraged my republican colleagues gave me 7 votes and all signed on the bill that wasn't that much different if this is what we wanted and they are afraid to give me a political win. i don't think that way >> do you think you need help politically in the next election i'm worried. a lot of people in west

virginia -- it is hard enough to get a democrat elected in west virginia >> if i looked at everything making decisions, it is like this and this. if i thought about me getting elected, i've never done that. i've been here 40 years. they say that's joe. >> you might be an independent >> i'm as independent as it gets >> are you independent >> how much more independent can i get? >> krysten sinema. >> i understand that for political reasons, i'll make that decision. i want to see whatever i have the best voice to understand i'm not protecting and not opposed to either side i look at the best policies and do it. >> they can count on you for the filibuster >> they know you change the filibuster and i'll tell you this, you change the filibuster, you don't have three equal branches of government the executive branch, if you have republican president and republican house and republican senator democrat, democrat,

democrat, and it is strong, that is the leader of your party. they push it >> push it out what will happen to the debt ceiling? >> i'll tell you what should have first of all, we have to recognize $31.4 trillion of public debt. no one is identifying that interest rates are so low so long, they are playing with it they have a situation of they don't have a projection of getting finances under control i talk to kevin mccarthy we can get a bipartisan group together and ask for the trust act. >> are you friends >> mitt is my friend i approach everyone as my friend >> what do you think of what is happening in the house on the republican side? >> let me tell you have you seen what is happening in ohio legislature? >> probably not enough. >> the house speaker just got

elected. speaker of the ohio legsislature got more votes with the coalition. i have been in state legislature. i worked with whoever wanted to get something done if you have 10 or 15 people that absolutely is no, no, heck no, you have to figure they will hold you hostage how do you offset that do i have 10 or 15 that might want to work to offset and balance that out >> if we get -- i think we will get the debt ceiling we worried about that so many times. >> we will not let it go >> the next two years, we should do another series of bills do you think we should do a lot? it is not possible with the house, probably. are you ready to take a break and get 120?

>> i'm ready to get something done the right way >> in 2024 >> if the i.r.a. is done the right way -- i'm concerned if it is treasury or whoever has the tax differences and do they interpret it differently >> you characterized the 10 or 15 people in the republican party holding the speaker. it did look like they were holding him hostage. it looked like what you had done the difference is you are a moderate and they had nowhere else to go >> here is the thing if joe manchin has voted this way and now holding people hostage, i said, guys, i never changed. 30 of us sent a letter in 2018, please, do not get rid of the filibuster we lost the checks and balances. okay i didn't change. 36 others chs changed. >> not just the filibuster

>> i voted moderate. >> senator, you could have held the line on the i.r.a. ran as a republican in the next election and won in a land slide. now i'm worried. you are like a man without a country. >> joe, i've been this way for a long time. >> what do you hear in davos you are a man without a country. >> this is switzerland >> greta is speaking about fossil fuels >> i speak to everyone they don't want to come here you have to have fossil fuel and should use it cleaner. we did carbon capture. we did methane capturing we are using the fossil fuel we have that is as clean as possible if you want climate, use fossil fuels and replace dirty fuel >> do you see that resonating? >> it is another view of looking at it and the intention for the

i.r.a. the administration sold it as an environmental bill that is a misnomer that is not designed for the environment.decarbonizing. >> we saw oliver stone here. >> i did >> he has a film out turned your ear about nuclear energy his argument is fossil fuel industry has demonized nuclear in unfair ways. >> when i became chairman of energy, we looked around we will close the four units in illinois thank goodness for governor pritzker the bottom line is i had bill gates come to west virginia. bill gates came and we talked about the small moderate reactor. it fits perfectly. plug and play.

>> do you have a good experience on the set 28 years the show has been on. is this your first time with us? >> did you ever invite me before >> we will have him come back. >> you can't go yet. i have one more for him. >> they are yelling at us? i couldn't hear anything i have one question. the other issue is china j janet yellen took the meeting not here, but zurich, for appearance sake, possibly with the chinese. i'm curious where you land on the debate if they are opening up or not and if they are opening up, whether u.s. and multinational companies should do business there? >> you have to figure out how in the world we will in the economic part of the world do without china. china is integrated in the world economically we allowed it to happen.

wto went viral from there. with that said, we have to have the security we need and basically that is the rare mineral oils and chips act and batteries. everybody thinks you get that because you have to source and we have to manufacture what is wrong with manufacturing in the united states we can compete with anybody in the world. we gave it away. let's take it back >> great conversation with senator manchin. there is a contingent out here of politicians who made their way. >> manchin and krysten sinema and senator coons. lots of governors looking for business for their states. >> when they get criticism, that is a good answer >> it is fair. >> it is global. it is not just -- they could do work in the united states, some of these states, with tax policies we are seeing migration. i had a conversation with

governor pritzker. he pointed at kellogg. they don't make up for some that left >> scitadel is a big one. coming up, fighting the tripledemic. sanofi cfo will talk about that. that's coming up next when we return to davos. [music - cover of blondie's “dreaming”]

[music playing] ♪ imagine something of your very own. ♪ ♪ something you can have and hold. ♪ ♪ i'd build a road in gold just to have some dreaming, ♪ ♪ dreaming is free. ♪ accenture, let there be change. why are 93% of sleep number sleepers very satisfied with their bed? maybe it's because you can adjust your comfort and firmness on either side. your sleep number setting. to help relieve pressure points and keep you both comfortable all night. save $1000 on the sleep number 360 special edition smart bed queen now only $1999. only for a limited time.

microsoft announcing layoffs. cutting 10,000 jobs. that is 5% of the work force ceo calling it a challenging time here is what he said at the world economic for um >> if you think about it, it is two years ago that the number of

software engineers hired outside of what is considered the tech industry is higher than the tech industry going forward, we will have more of the digital scale spread across evenly over the economy >> job cuts expected to be completed by march the stock down 20% in the last year actually better than most tech stocks. pharmaceutical giant sanofi has a solution for five years to improve health worldwide especially with the tripledemic. for more on where the company is, we want bring in paul hudson >> great to see you. >> you are three years into the plan >> exactly that. we are slightly ahead of the plan we first came back in 2020 to share what we will do, we didn't

realize how much progress we would have made by this point. innovation you mentioned with rsv. breakthrough is around the corner >> you have a fatter pipeline than you used to a lot of projects coming out are you happy with the pace of things >> this is where i'm positively surprised. we moved from being good at science to trying to be the best in areas be first in areas that have never been treated before. if you look at rsv, for example, there is a clear problem across the world, particularly in the united states. it is very difficult to get emergency care bed for a newborn in the united states at the moment really a problem to do something about it hopefully to have something approved before the next rsv season >> i have been excited to see this you are not the only ones with rsv vaccine. we had moderna on earlier this week and pfizer and gsk working on one i think that's for older people.

your's is for newborn. >> we are first and hope best in infants. mrna is not applicable to newborns we are excited as a father of children myself, we have all been there >> in terms of competition pfizer and gsk has research that shows it is effective in infants if it is given to the mother first. that is a problem with p competition? >> that is a big debate. there are not many vaccines like that >> we talked to stefan yesterday. the trust issue. there are activists outside here in davos who think the elite group misled people or other things when it came to the covid vaccine and what it was capable of and what it could do.

how does it relate to the trust in vaccines and in mrna vaccines in the future? >> you know, i think we have to accept the industry works together to do the right thing to get the world back to normal. it is natural people debate questions further down the line. people trust us every day. also us every day. also this year, we'll launch -- to give people a normal life those patients trust us. they want to breakthrough. they want to live a normal life. when you're bringing hope to people who haven't had it before, it's game changing. >> twitter is not the real world -- i know what you're saying about the trust for the vaccine. i think the great majority of people are thankful that the worst-case scenario, it may not stop transmission, but it stops the worst-case scenario, probably stops hospitalizations. i had a quick question, paul you said infants don't have immune systems but you're calling it a vaccine. >> it's a monoclonal -- >> you're giving them the

antibodies. >> that's right. and it's genuinely -- we're ahead of schedule -- >> but you call it a vaccine. >> it's an immunization. >> you've given the antibodies instead of generating natural -- >> absolutely. but we're ahead of schedule. importantly, we're one of the few companies that has no patent expiration beyond 2023 every step forward we take is a positive step forward. >> what is the antibody against? what part of the rsv, and is it conserved? >> it's -- we'll avoid 80% of exacerbations leading to hospitalizations that's a big step forward. >> let's ask about dupixent. that has been a huge profit center for the company too

what comes next with dupixent. >> it's a great question it keeps finding itself applicable to change people's lives in new diseases. diseases that -- we keep breaking new ground. >> it stops your immune system from doing some of these bad things. >> yeah, basically there's a type of inflammation that can be turned off very debilitating things, it's a big deal if you can get back to a normal life. we've shown real progress in what we can do >> i want to thank you for your time today it's really exciting seeing some of the advances that you're making we appreciate it. >> thanks for having me. coming up, a lot more right here on "squawk box.

procter & gamble jon moeller is into join us we'll be back with that and so much more. >> announcer: executive edge is sponsored by at&t business at&t 5g is fast, reliable and secure of”. but seriously we need a reliable way to help keep everyone connected from wherever we go. well at at&t we'll help you find the right wireless plan for you. so, you can stay connected to all your drivers and stores on america's most reliable 5g network. that sounds just paw-fect. terrier-iffic i labra-dore you round of a-paws at&t 5g is fast, reliable and secure for your business. why are 93% of sleep number sleepers very satisfied with their bed? maybe it's because you can gently raise your partner's head to help relieve snoring. at&t 5g is fast, so you can both stay comfortable all night. save $1000 on the sleep number 360 special edition smart bed queen now only $1999. only for a limited time.

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edward jones

welcome back, everybody. we've been watching the futures and the picture has gotten a little bleaker since we started an hour ago. the dow futures right now are down by 232 points that comes after a decline of more than 00 points yesterday. s&p futures are off by close to 30 and we are continuing to watch also been keeping an eye on the treasuries checking things out right now, you'll see that the ten year is a little higher than it was earlier, but still below 3.4%, two year is sitting at 4.084%. >> coming up next, we have

procter & gamble jon moeller joining us from a balmy san francisco as we freeze our noses off while we're here >> and our fingers >> the consumer products giant reports quarterly results. "squawk box" will be live from davos in just a minute [music - cover of blondie's “dreaming”]

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today. in the last hour, jamie dimon told us what he thinks about what investors should be focused on. >> the real issue for the world is russia, war, ukraine, energy, trade, and that is serious and that's still out there hopefully it will all mitigate and go away, but it may not. as a risk manager, you try to prepare for some of that >> we will have more of that interview later this hour. plus the ceo of illumina joins us to talk about the fight against covid and much more. and another debt ceiling deadline the u.s. government expected to hit that key threshold today with lawmakers appearing nowhere near a deal on the matter. that story is much more as the second hour of "squawk box" begins right now ♪

good morning and welcome back to "squawk box" right here on cnbc. on day three, we're live now at the world economic forum at davos switzerland. i'm andrew ross sorkin along with joe kernen and becky quick. as becky just mentioned, things have been moving and unfortunately in the wrong direction. dow down about 221 points right now. nasdaq looking to open off about 95 points. the s&p 500 looking to open down 29 points. take a look at treasuries. that's also been an indicator of where this may or may not be headed the two year at 4.082. jamie dimon was telling us he thinks we're going to be over 5% -- >> he said that's his own -- he doesn't like making predictions. a lot of times they're wrong but he said his own personal feeling is that, yeah, that we will go above -- >> he's made a lot of predictions over the years and he's been closer to right. take a look at -- >> a lot of it is based on china reopening. because the -- kind of the good

numbers we've gotten on inflation -- those were transitory, the good numbers as china reopens, it doesn't matter if we're slowing down. inflation is going to come back and the fed will have to -- >> that's the scary scenario. >> with china, the interesting number being that they import 11 million barrels a day of oil during the lockdown there it droppedby 1 1/2 million. if that kicks back up, that's the free float of excess oil around the world. >> when we had the real high inflation numbers, remember a lot of that was $100 oil trickling down through all aspects of the global economy and we've had a respite of that. >> and we're looking at wti at $68.68 right now we should take a look at crypto. getting some real support from jamie dimon this morning we'll be showing you -- >> he called it a ponzi -- a decentralized ponzi scheme

he's got back full force >> pet rocks. >> bitcoin at 20,000 -- >> jamie said that at 2,000, 8,000, 12,000, 65,000, but now it's not back to 2,000 he may end up being right, he may not. >> he does -- it wouldn't be great for jp morgan. wouldn't be great for centralized banking, honestly. procter & gamble out -- just out with its second quarter results. adjusted earnings $1.59 a share and it was the second quarter in a row of lower earnings from the previous year. revenues slightly beating the street joining us now with the report, jon moeller. jon, welcome, it's good to see you. is it overstating it to say you're managing, you're treading through this period, you did have net sales down 1%, but organic sales up 5% but with a

strong dollar it's just tough to grow earnings year over year because math is math >> well, look, our team -- i want to thank and congratulate them they've done a tremendous job of managing challenges on both the top and bottom line and coming through just fine in the process. as you said, organic sales up 5% every -- each of your ten categories, personal health care up 18%, home care, fabric care, and feminine care up high single digits, et cetera, we held aggregate market share from a geographic standpoint and the focus markets grew 3%, that includes the u.s. where we grew 6% we held share in the u.s we grew volume share by half a point. we crossed a significant threshold which is $10 billion in sales for the quarter on the way to $40 billion for the year which compares to 30 billion

just four years ago. all of that good work allows us to increase our top-line guidance for the fiscal year from a range of 3 to 5 to a range of 4 to 5. on the bottom line, equally impressive work, the -- we had headwinds of 25% of earnings from the combination of commodities. the team offset 21 of those points while building the top line and holding a very strong share position i'm very proud of the work they're doing in very difficult conditions >> you summed it up, that was going to be my question. if you value a stock on its growth rate and there is no growth rate, you're dealing with these headwinds and you summed it up. i don't know if you need to break it down between dollar headwinds, which have been subsidying a little bit lately maybe it looks like a little bit better from the outlook.

but commodity pressures are still squeezing margins, is that fair to say? >> both foreign exchange and commodities are significant impacts. the totality of foreign exchange commodities and transportation costs are a $3.6 billion after tax headwind the team is largely offset and you think about that business model from both the top-line standpoint and that earnings power on a bottom line standpoint in a normalized environment, this becomes a very attractive proposition >> we -- okay, so the dollar has improved a little bit. you do business in china, obviously, do you expect inflation to continue to trend lower, john? what are do your people say. what are they telling you to plan for, or does china reopening just turn the heat back up on commodity prices? >> well, we're in a world as you've been talking about all week which is very difficult to

see very far in the future with things like china, with things like russia, the energy markets, inflation, et cetera but generally what we're seeing from an input cost standpoint as prices continuing to rise. as you indicated, at a lower rate than they were previously with some turnover in the feed stock areas from a commodity standpoint that will take awhile to flow through our income statement these are areas that we're going to continue mitigating. >> jon, i've heard some input costs, certain parts of the commodity that are still going up at 15%. do you see certain components -- not components, but input sources for your products that are growing -- that inflation is still that high? >> i would say on average it's mid to high single digits. it varies greatly as you can appreciate between the different input costs.

obviously, there's a different echo system surrounding it and different supply and demand dramatics. but generally, inflation continues, but as you said, at a lower rate >> transportation, what are you talking about there? supply chain, energy prices, all of the above what causes those costs to go up >> transportation has been a fundamental mismatch between demand and supply which is leveling out and so we do see some turnover in the transportation cost market which is encouraging that supply chain isn't very good at dealing with huge volatility which we had from both a demand and supply standpoint, if you think about the u.s., for example, and so as things normalize, that should hopefully normalize as well. as i mentioned earlier, to the extent that all of these costs normalize, the dollar pressure

subsidies, that's going to be a wonderful opportunity to continue to invest in this business, continue to increase the delight that we're providing consumers and delight shareholders at the same time. >> how about consumers are you seeing a trade-down. we heard that the savings rate that were high after the pandemic relief, there were balances that were built up and a lot of it is gone. have you seen a drop-off there in certain segments of the consumers? >> we haven't seen a lot if we look at private label market shares as a proxy of consumer trade down in the u.s. in the last three months, they're up 20 basis points, which is a very small increase in europe, up a little more. about 90 basis points. importantly, though, as i mentioned earlier, our shares are holding and in large part that's because we've transformed

our portfolio to offer trade-down opportunities when consumers want them within our brands so you can buy a tide power pod for 50 cents a load, you can by a regular tide pod at 30 cents per load or regular tide at 20 cents a load so we're much better positioned to deal with trade-down, continue to delight consumers within our brand family if that should occur but we're not seeing a lot of it >> how many employees globally now, jon, just update me, roughly. >> about 105,000 >> how much economists are employed by procter & gamble seriously -- are they forecasting a recession? do they tell you, we're going to have a recession this year >> they tell me that we could. they're telling me the same

thing that everyone else is hearing. >> how many do you have? you got five, ten? any of them any good any of them got big things ahead in the future? >> we have lots of sources of input beyond our own economists that help inform these views, as you can appreciate we don't have a lot of economists. >> after all that, we could have a recession, that's all you got for me, jon. you would know at procter & gamble what do you think, 6 and 10? what do you think? mild one. >> if -- things actually look pretty good. if we look across the world, let's assume that china does recover, the u.s. economy continues to be strong, demand for our products continues to be strong, our markets continue to grow, consumption continues to grow, the developing markets have been fairly resilient through all of this. europe is a bit of a question. obviously eastern europe, but

also western europe depending on what happens in the energy markets, et cetera, but you put all that together and it doesn't look honestly horrible >> so you're not doing anything differently to assume a recession is coming. you're kind of moving full speed ahead? >> well, i keep -- when we talk to the team here, i don't know what we do differently in a recession than what we do without a recession. it's the same thing jamie was talking about this morning it's kind of whether -- or job is to delight customers, delight employees, be responsible with society and delight shareholders and the activity systems that support that are the same, whether we're in a recession or not. we need to be cost conscious, whether we're in a recession or not. we need to offer superior products, packages, communication, retail store

operations, and value whether we're in a recession or not. so i'm not trying to dismiss the conversation around recession. it's an important conversation but it's not one that we spend a lot of time within these walls working on because our job is the same. it's an exciting job and it's an important job. >> 4 1/2 points when it opened, it's 5 1/2 now do you think it's going up from there? this is another -- what are your economists saying there? will it be a touchdown by the time -- by sunday? do i take the points or the bills? >> i think a lot depends on the injury reports later today our offensive line as you know is struggling a little bit we'll see what happens there but i'm -- it's been so much fun the last two seasons and this season and i'm on the bus. i invited you to join the bus

last year. you declined the invitation is still open. >> i did i've learned if they need a lineman, jon, probably not, right, it's -- >> a little slow [ laughter ] >> a little slow at this point jon moeller, sunday, it's exciting, we'll be watching all the more important stuff at that procter & gamble as well, thanks >> we got a lot more coming up right here from davos, switzerland. illumina has been front and center the ceo is going to join us right here to talk about the technology and its efforts to transform lifetime health care for patients. take a check on the markets right now. we are in the red this morning looks like the dow would open dow 245 points nasdaq up 91 points.

s&p 500 off 30 points. we're coming right back from the alps right after this. >> announcer: this cnbc program is sponsored by baird. visit bairddifference.com. if your company actually practices the values that it posts about, then, yeah... you're on team earth. this thing, it's making me get an ice bath again. what do you mean? these straps are mind-blowing! they collect hundreds of data points like hrv and rem sleep, so you know all you need for recovery. and you are? i'm an investor...in invesco qqq, a fund that gives me access to... nasdaq 100 innovations like... wearable training optimization tech. uh, how long are you... i'm done. i'm okay. why are 93% of sleep number sleepers very satisfied with their bed? maybe it's because you can adjust your comfort and firmness on either side. your sleep number setting. to help relieve pressure points

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paying the bills for the nation but without raising the debt ceiling the nation could be on the verge of a default that's been the topic of conversation janet yellen can keep things moving around until june by taking these extraordinary measures hopefully that buys time for them to settle these things. when we come back, we have gummy bears. should we just -- we're going to admit that we have gummy bears in our mouth >> cannabis? >> no, just regular gummy bears. then the ceo of bmo, we're going to have a big wrap-up of some of our big interviews on "squawk box. you don't want to miss it. we're coming back from the swiss alps after this. >> announcer: time now for today's aflac trivia question. who is the youngest ceo on the

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fortune 500 list the answer, mark zuckerberg. gene sequencing equipment maker illumina warned that its profit will be lower than expected they're facing antitrust challenges, but despite those hurdles, it's embarking on new projects that will revolutionize health care. joining us right now to talk about the future of gene sequencing and more, illumina's ceo, also a board member at disney thanks for being here. let's talk about gene sequencing and some of the cool things that you're doing we've been talking about the genome being the answer to all things medical for decades but it feels like we're on the cusp of new things that bring the cost down. >> you're right. it feels like after a couple of years, there's a lot of research on the genome to understand how

your genome translates into human health and decide. we're at a stage where some of those discoveries are showing up in the clinic and making a big difference in a number of disease areas. we've seen in covid, for example, how it helps us identify the pathogen at the beginning, was instrumental in the mrna vaccines that were developed and today used to track how the varieties are emerged around the world we're also seeing it in cancer it's used in children's hospitals today to diagnosis babies in the nicu that have genetic diseases and far and away, that's going to be the biggest part of the market. >> what is grail promising right now? >> it's an exciting technology that we developed at illumina that has been launched in the market now 18 months ago what it is, it's a blood dtest that you can take that can identify if a person has one of 50 types of cancer, stage one to stage four that's a big deal.

we know, cancer kills ten million people a year, if you catch a cancer early, your chances of survival can be pretty good. most times, pancreatic cancer is caught too much and you have a few months to live with the grail test, you can do the blood test, if you're over 45 and have a risk of cancer in your family, it's something you should talk to your doctor about. it will tell you if you have one of those cancers across stages >> you do it now how much does it cost? >> it depends. some employers cover it for their employees so if you work at our company, it's free. some health insurance companies like .32 cover it and we have some other health systems that are offering it -- >> what's the full, fair cost and what's the insured fair cost. >> if it's insured, it's free. if you buy it retail off the website, it's $950

you would have to have our -- your doctor would order it. >> you do it with your annual. >> that's right. that's what i do. >> where does that stand right now? >> so from a business perspective, grail has a lot of traction it launched the product 18 months ago -- >> able to keep it >> we're working through that process right now. >> we talk about -- you've got some teeth in antitrust. is this a direct challenge to them will they take it that way >> it's a process. it's too early we're in the middle of it. it's too early -- >> i like your style >> this is a unique way -- >> you're taking it to them in a way that most companies don't. >> we think it's important the grail test is impact in terms of the market it's going to have. illumina can accelerate grail. we founded it. go through the trials, we have to raise more money and we bought it back grail will make a difference, but with illumina we can make the tests available much more broadly than the start-up could

on its own we have expertise for getting reimbursement for tests. we've helped get reimbursement for a billion people around the world for genomic tests. >> cancer is so complex, stage one, two, three. are the stages and -- if you find it early, pancreatic, it hasn't metastasized, are all cancers similar in those stages where if you catch them, you can say definitively, it hasn't already spread, or are the markers different for different cancers. >> the earlier stages across cancers means it hasn't metastasized that's when you have your best chance of -- >> you can detect it with -- >> exactly the 50 cancers 45 of those have no other screen we rolled it out at our company and see a a ceo, it's one of the few times i got to roll out a

benefit that people love we have heartfelt stories, one guy told us he found an early stage breast cancer. and he was reflecting on what that could have meant for his family we had early stages of pancreatic cancer being found. i was able to roll out a test that people love, but it saves us money because we are self-insured. actually, treating a cancer early not only gives the person the best chance of survival, it's cheaper than treating it late. >> is that your plan to show that this is saving lives and you guys are going to slow it down >> we're showing there are health benefits to making this test available more broadly, cheaply than ever, especially to underrepresented communities the ones that are least likely to be able to afford self-paid test it's to show the health benefits, also to show this is a procompetitive deal. we had rulings from the judge

that this deal is procompetitive when we got this case to court, the judge ruled in illumina's favor. we feel good -- the first time, the only time this case was heard in a court of law, the ruling went for illumina. >> let me ask you just about the stock price. shares sold off last -- a few weeks ago when you were at the jp morgan conference and you announced that the earnings were going to be below what the street was expecting on that your stock is down 47% over the course of the last year or so. is that because people had so much money that they were spending on chasing mrna vaccines and doing things during covid and that spending has come down is that because there's less money at biotechs right now because of the availability of funding? what's happened? >> i think in general, we're seeing a pullback in the sector and -- whole set of reasons around that, including the higher inflation and interest rates. for us looking forward, though, there are two big catalyst that is we're talking about one, we just announced -- we're

weeks away from launching our most powerful, the most green sequence on the market three times more powerful than the previous most powerful it also has eliminated the need for a dry chain. it makes the sequencer available to more countries than it was before we're on the cusp of a big product launch i think that's a good catalyst and grail continues to have traction in the market it had the fastest 12-month revenue ramp in history and they said over the next five years, they expect to grow between 60 and 90%. two big catalysts. >> the future of cancer treatment, do you think it comes from finding the organic causes of the cancer itself, or do you think early detection basically renders cancer, like a benign event? and -- would you need to know how to cure cancer if you could detect it earlier enough -- >> i think we're going to need

all of them. cancer is a devastating disease. it has the potential to avert a lot of the deaths associated with cancer. surgery is more accessible around the world than, you know, the late stage expensive treatments but i think we'll -- >> all of the above. >> the cancer vaccines that we're starting to hear about are also very promising, very personalized and targeted and we're working with some of those manufacturers. but we'll move all of those forward to fight cancer. >> using the immune system rather than the -- we'll never stop that, i don't think >> before we go, i got to ask, nelson pelts wants on your board. why don't you want him on your board? >> i would refer you to talk to disney about -- >> here's a question, disney's board said nelson pelts, you don't have experience in media historically, i don't believe you had experience in media. there are lots of people on that board with lots of different

experience what makes him a good board member or unworthy, if you will. >> we're always open to engaging with shareholders and hearing the feedback and then, you know, we work through our process about what we think disney needs for where it is right now. and so i guess more specific questions, you'll have to talk to disney about it. >> i want to thank you for being with us today. we really appreciate it. >> had to try. appreciate it. >> thank you. illumina comes in at number 28 on our partner just capitals just 100 this year up four spots this year. illumina has just been -- has been a just 100 leader for four consecutive years. >> do we know, is nelson better at media and movie production? do we know good at both >> his daughter is an access, by the way. >> that would -- i don't know how it helps with illumina. >> still to come, renewed recession fears rocking the

markets. renewed or are we really taking it seriously now yesterday we saw what happened we're going to hear from darrell white. that's next. at the top of the hour, morgan substantially ceo james gormen on the state of the financlsthe teia, last quarterly results and much more. your dedicated fidelity advisor can help you open those doors. they can help you create a retirement-income plan designed to balance growth and guaranteed income. and provide access to specialists who help with estate planning to look out for future generations so you're not just growing and protecting your wealth. you're sharing it. because doors were meant to be opened. great job, everybody!

welcome back to "squawk box. new this morning, bank of a america with a double downgrade to charles schwab. their price target going from $95 to $73 a call that the fed will end its interest rate hiking cycle by this summer, removing a near-term profit driver. that's an interesting one. it's a weird call given all we've been talking about here. >> let's get nonweird calls, maybe. the dow off more than 600 points suddenly, recession. that's our big worry more than inflation. you got to be on your toes joining us, darrell white. we left the show yesterday morning and we saw the cooler ppi number and it's like, all

right, beginning of the year, it's better, full steam ahead, inflation is moderating and then all of a sudden retail sales is what -- or at least the notion that there might be a recession is come back in the forefront. we're never satisfied. >> what's tomorrow going to bring? >> you better pay attention because you never know where are we >> look, i think you can look through the day to day at the end of the day i would say two things on this, i think near term, i'm cautious but medium term i'm bullish and i'll tell you why when you look through the rates inflation battle that we're observing every day, the next three to four months i would say, joe, are critical because, of course, there's a bunch of people who -- this is the worst cocktail possible, high rates, high inflation you get through the next three to four months i'm not calling this for sure. but the highest probability outcome is that we're measuring everything data driven, central

bankers, year over year. you look at month over month we're increasing at a slower rate and you get into that may june time frame and the year over year has a better chance. now, we have a pivot point, i think, i think we probably do get the 5% on the terminal but then, let's imagine -- i'll pick a number, 4%, in that may, june range now you have a vision to three by the end of the year that's our call, by the way, three by the end of the year between 1914 and 2022, the average inflation rate in the united states is 3.3%. >> the fed should change its target >> but the question is, if they don't, then they're going to -- >> let me throw one more thing at you, though part of what's been keeping this going is the consumer has been spending they've had excess cash. a lot that is because of the money given to them by the federal government i heard that money is probably due to run around in june.

around the same time that happens. >> and if there's vision in the path that i've described, you got a situation where -- look, i traffic in both canada and the u.s., tight labor market everybody who wants a job has a job. that may not be the case in may or june. but there are a lot of who can still get jobs and the excess savings, yeah, scheduled to run out may, june. i would be surprised i think it will last longer than that. >> why do you think that >> because we've got -- >> you don't people are living this yolo life. >> they're spending less than they were and we've got a chance that as we go through the summer, they'll spend less and less and less. as long as they have a job, i can tell you what we see, they're still paying their credit cards and mortgage. >> can you explain why we -- or at least traders, market

participants cling to the notion in a the fed is not going to get to where it says it's going. you can't explain that. >> i can't explain that. >> do you think the markets are wrong or the fed is going to finally blink. >> no, i think that the markets are trying to every day calibrate where you started the conversation to say, what does it mean? where are we and there's not a lot of liquidity in the markets i think it will be volatile. i will say i'm medium-term bullish and i'm bullish on north america. as i look -- it's a relative world. if i look at a reorganizing world, i don't believe in deglobalization, i don't think that's -- >> but profit margins -- or profit recession wouldn't that go hand in hand with a slowdown later this year. >> and it's all relative if you look at -- >> it's already baked in. >> i think it is baked in. our house call is zero >> you said it you said it.

and better in north america than just about anyone where else in the world. thank you. you came in and went, wow, this is balmy compared to home. >> i can't believe you do this all week. >> it's gotten colder. >> it's cold outside if you see us doing this, that's what it is >> thank you, darrell. hope to see you again soon. when we come back, we'll take a look at some of the big issues in davos and what it means for business we'll bring you a few highlights and then from the cloud to supply chain disruptions, the ceo of hewlett-packard enterprises will be our guest. "squawk box" will be right back. [music playing] ♪ imagine something of your very own. ♪ ♪ something you can have and hold. ♪ ♪ i'd build a road in gold just to have some dreaming, ♪

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the consumer spending across our customer base has slowed which means, that's good news and bad news consumers have money in their accounts, they spend it down a little bit, they have a lot there. my belief is a mild recession. >> what our data has been showing us, we've seen peak dollar at this point and we've also probably seen peak selling of u.s. equities at least for the moment >> i think it's more important from a global stability perspective more so than it is whether i invest in china or not. i think we need the u.s. and china to find a way to compete and disagree but do it in a way that, you know, it works for the global economy. >> i think the sentiment is softening a little bit and the view that the chance of a softer

landing both in the u.s. and europe is actually increasing. >> the way we run the company is to serve clients day in and day out through thick or thin. i know there are going to be recessions i don't spend that much time worrying about it. i worry about poor public policy that damages american growth i worry about a lot of stuff but not about whether -- what the weather is going to be like. i don't want a recession because it hurts average americans i have to be prepared for it >> those are just some of the ceos that we've been speaking to all week in davos. with us to talk about some of the takeaways is ben smith it's been a must-read about all the goings ones and we'll talk about that in -- >> this is a great time for you to come on because you have to read -- >> hang tight. hang tight let's talk about what's going on here in davos and whether we think it's actually changed because one of the things that -- there does seem to be a shift here in terms of a prior

year's big policymakers, sort of less big policymakers this year, more of a business meeting of sorts. what are you seeing? >> you showed the montage of every ceo here they're happy to show up on the cnbc's set but they're not here to make announcements about policies they're here to have meetings back to back -- >> is that a backlash against esg and what we've seen there? is that we're in a challenging environment. >> i think it's a moment where a lot of leaders, macron, sunak, biden, don't want to be seen in this globalist, high-end environment where there's a -- >> you think that janet yellen showing up in zurich, that's what that is >> yeah. and a bit of a snub that she couldn't -- >> isn't this a rich place to come to write about what's going on you know what i'm saying isn't there a -- >> it's incredible

but it's a big journalistic challenge. but i always feel when i write something about davos, the main reaction is, like, you're reading a story about somebody who went to a party and they're telling you about, and you're telling these long boring story at a party and these people hate you. but they read it >> i would like to be you here -- >> let me ask a question as a entrepreneur, you have a big contingent here and you've been running a big number of events here you decided this is the place to be. >> it's an incredible place to talk to central people who shape opinion, who make decisions, great sources, big part of our audience i would say, my partner justin smith and i are sharing a hotel room we're a start-up. >> and what do you see -- there's a huge criticism of this place. >> yes >> and whether you think that's changing, whether you think that this is -- is davos dead what is it >> i think it's going back to

its roots. it started in the early 70s as the european management forum. it was a business place for sales and strategy and a lot of the mission kind of grew out of that and it feels this year like it's back to -- back more to business a huge change in who is criticizing it there's a -- climate protests. if you search the word davos on twitter, it's all to the right -- it's elon musk. it's people who think that the ceos here are gathering to make you take vaccines and to eat bugs that is what they are -- that's the thing. >> the great line is billionaires telling millionaires how normal everyday people think, right? you use that line. i kind of -- i like it here. i feel like i'm in on the joke kind of. that's maybe -- i shouldn't say that, but i don't think a lot of people aren't in on it >> there is -- here we are people are taking private jets here to wring their hands about

climate change -- >> i haven't been to a single panel -- >> i don't think they're wringing their hands about anything i think they're having business meetings. >> i think -- >> how much do we talk -- >> i think the reason why -- >> 2500 a night ladies of the night that are shipped in here there are great things to write about here >> have you been writing about that >> the mail beat us to that one. >> so to speak. >> i thought we should be getting a guest out here. >> one huge change, there are fewer russians and there are not these huge russian oligarch parties that were more decadent than anything you're seeing. >> it is amazing, if you just like to watch what's happening -- >> the caviar and champagne, there's no more caviar ben smith, bringing us the

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welcome back, everybody. our next guest has a front-row seat to the latest in innovation the labor force and supply chain disruption we want to welcome

hewlett-packard antonio nerry. >> i think we start with what you talked about last may when you were here in davos you said that the supply chain disruptions were real and you were experiencing them and you expected them to last for sometime to come here we are seven months later, what is the situation? >> much better significantly better i think we went through a period to recover both by the addition of capacity but also driven by the decline in consumer which allowed suppliers to shift supply to enterprise space, particularly i.t. enterprise so i will say today here probably more than 90% out of the way. >> that is great news to hear. >> yes. >> labor market getting better in terms of the employers perspective. not seeing the same levels of attrition. >> no, actually, i was reflecting on this before i came here with my team. we reviewed the work force and do it every year to see what the

employee engagement is and we have the highest in the mid-80s and the lowest attrition in a long time. low single-digits. >> it had been 9% to 10% before. >> it is high single-digits. >> so you're talking about that. we've seen how much trouble technology companies have had lately the nasdaq was down last year. your stock has been a counter trend. your stock was up last year versus the rest of the nasdaq. you've been on quite a tear and investors are trying to get away from companies that don't have profits and they want companies that put up profits and put up the numbers. >> we still have a way to go for the amount of profit and actually growth we're driving. we believe we are well positioned for the trends in the market and last year was a strong year. we drove growth on revenues, close to 6% for our size is meaningful but we expanded margins. we actually more than double eps

from four years ago and we are on track to deliver a strong year this year which is very good news for us because it said our strategy is working to become a supply company. >> and strategy is to get more people to pay for services >> we see customers are changing the way they consume i.t they want to consume it more and more as a service. it is not just renting a public cloud space to run applications and host the data. they want to do it across the entire i.t. and that is what we believe, and that is new an advantage for us >> what is your biggest compet competitors at this point? >> all of them but we are -- it is a matter of delivery value together to our customers and when i look at some of our competitors, think about the public cloud, we actually partner with them to integrate their solution and our solutions together so there is way and room for us to work together to deliver a

better value proposition and work together. >> wyou have a lot in your favor but what are the biggest problem that you're working on right now. >> our own execution i think we have done a really good job, i think about the beginning of pandemic and all of the sentiment about layoff and tech an the like we were the first to go out and the first quarter of 2020, right in march of 2020 to basically announce reallocation of resources for high growth, high margin that is paying off because the results we delivered in q4, it was a work order, it was the series of moves we made since 2020 so i think for us it is execution and serving the customer better than anyone else. >> and i feel like everywhere i go people are talking about chat gpt and i wonder how you're thinking about ai and machine learning and whether you think everybody will be in that business >> well, i think, and we have an

opportunity to use save i to solve some of the biggest problems we are at the new age of insights this decade has to be about extracting the size from the data and some of the biggest challenge is here in davos we provide amazing capabilities for advance in ai. think about super commute power at the ai scale, last year we unveiled for the first time the first system, the ability to process 1 quint illon per second and we're a big provider to the united states government but both the doe, but here i'm here to talk about how they help them too. >> antonio, thank you for your time today. >> thank you for having me. coming up, james gorman will be with us after the break to

discuss necerenews recession fes it does look like we'll open up in the red this morning. dow off about 190 and the dow jones off and nasdaq out weave a big day three from davos, switzerland, after this u] ♪ imagine something of your very own. ♪ ♪ something you can have and hold. ♪ ♪ i'd build a road in gold just to have some dreaming, ♪ ♪ dreaming is free. ♪ accenture, let there be change.

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good morning, futures sliding ahead of the opening bell as we getready to wrap up the week in davos. we're speaking with one of the financial industries top voices. james gorman is going to be here also this hour, breaking jobs and housing data, and we'll bring it to you and a special interstrew with world center kitchen jose andres about fighting hunger in ukraine the final hour of "squawk box" begins right now ♪ good morning and welcome to "squawk box" here on cnbc live from the world economic forum in davos, switzerland i'm joe kernen along with becky

quick and andrew ross sorkin and equity futures are adding to yesterday's recession fear induced losses down another 300 points, 111 on the nasdaq is quite a bit and we would be remiss not to look at the ten-year, below 3.3. it has been moving up as the premarket session has moved up 3.41 it almost looks like the two year would go be lee four. morgan stanley ceo said he's more confident on the markets than the rest of the wall street -- why am i reading he's right here. and he also apparently you could confirm this or deny it, he's a return to deal making once the fed stops hiking rates that optimism followed better than expected fourth quarter earnings on tuesday. joining us now morgan stanley ceo james gorman it is great to have you. and it is a confusing time

because not only banks are created equal, are they? we just asked jamie dimon, what the hell happened to goldman maybe you have a better idea or why don't you talk about morgan and how you managed it bet maybe better than some of your peers. >> hey, joe. nice to see you. thanks for the intro. >> how did you do it >> we've been doing this for over a dozen years and you lay these suits over long period of time. we had a clear strategy of what we wanted to do and that is what we focused on. i focus on morgan stanley. i'm not a strategy through envy person i focus on what we do. what we're good at what our capabilities are. and we've steadily de-risked parts of the business that got us in trouble during the crisis and we made a major push into building up wealth in asset management and it worked but we're delighted with where it got to. >> so you're out with the three of us having cocktails and we

go, wow, goldman never misses. what happened. what do you tell us on a bar. >> i could tell you that i can't talk about our competitors. >> i wonder what you thought might have been planted by some of your peers. >> i don't think it is fair to compare. >> you used to compare goldman and morgan all of the time. >> you guys do but our job -- what i get out of bed every morning and worry about is morgan stanley. that is what we control. our dna is different from all of the other banks. history is different and i think you have to respect what your capabilities are. >> you think the history is different or do you think -- because i remember, we used to have these conversations post-crisis, where you actually talked about making that pivot in a way that most other firms did not. and it wasn't necessarily most popular thing to be talking about at that time >> no, i was very unpopular. not with you, i'm sure but with others.

>> i'm curious, how you think you got there and then to the extend that you actually had conviction, there is two things. one there is a strategy piece and then the execution piece. >> yeah. listen, firstly, we have an advantage of not doing well in the financial crisis to put it politely that forces you to have to make strategic choices because going into another crisis with the armory that we had then was not going to work. that much i was sure of. and there were two things that we needed to do. we needed to get out of prop risk where you're putting your clients, whether it is on the trading side or investing side, we needed to get out of that which we did and the dodd/frank and volker rules, but on the other hand, if the world got tough again, which we just saw last year, we would be just fine and the way to do that is to

build businesses that are stable it doesn't matter the market conditions every person is buying a stock and someone else is selling it and everybody is putting money out of cash is taken out there is constant movement of money. so our job is to be in the middle of it we have 18 million clients now and they're not all behaving the same way every day and that gives you a level of stability. it was a commitment to it and then we did the deals that supported it which were aggressive we were told consistently when we bought smith barney, and then ea eaton vance, we over ppaid on a of them. it doesn't matter. what matters is over a ten-year period what you could do with that business and over a ten-year period we took what was about 600 billion in our client assets in wealth management to 4

trillion that is what matters not what you paid. >> last year was difficult what do you see this year? >> i think it will be better i really do. i'm probably at one end of your optimism and pessimism scales and maybe that is a happy place to be, coming out here with a little more positive step. but the eckee chamber is starting to reflect that but two things which changed the inflation numbers are better clearly inflation peaks. it is no longer a question, it is a fact. the question is, can they get to 2% and how hard will they try to get to 2% versus stabilized around 3%, 4%. china has made a major pivot the focus was on the reopening which was obviously critical but the recent pivot. >> to open up, you're suggesting >> no the recent pivot

economically, the relationship th thorring with the u.s. and the meeting with the u.s. and secretary yellen, this is a big deal under president xi's mantra of common prosperity there are two ways to achieve that one is by redistribution of existing prosperity, so everyone gets a piece of pie. the other is growing the pie they have pivoted from the former to the latter. >> maybe we can some day no, i'm kidding. all big countries face that. don't they we've had the same argument here. >> you've got to focus on growth not on economic redistribution. >> so you gave us a great synopsis, i can't believe i had to twist your arm to tell you why morgan stanley is doing better than goldman sachs. i think we finally do have a -- a good idea. >> listen, i have a lot of respect for our competitors. particularly goldman they've been a major competitor for our whole history and wreef

been through periods. >> but you went through a tough period through the too big to fail period and you learned from that. >> well if you don't learn when you get smacked in the face, you really have a problem. so, no, i was absolutely committed to the model we had coming out of the crisis would not work in the next crisis. and we had to change right. >> you mentioned 2%. how quickly do you think we could get to 2% and why are you not worried that jay political will overshoot >> they might. >> but your optimistic. >> we were on a 75 basis point track and we quickly moved to 50 the talk for next week, february 1st or something, is 25. i could see them doing 25 followed by 25, followed by a pause. that is not implausible. and that is a dramatic turn. now what i don't see at the other end, and a lot of people -- i'm not an economist so this is my opinion, what i don't see is some cutting. because that is really playing

with fire. to have done what we've done with rates, taken them up to where we are and turn that quickly to a cut i think you have to let this thing settle listen, nobody knows how effective the rate cuts that were put in place, which were the fastest in 40 years. there is a lagging impact. so nobody knows when that lag is gooding to finally hit it is starting to work its way into -- >> so you don't see a 6% after inflation comes back from china reopening. that is what people are worried about. and we're underestimated. you could see 4.5 or 4.75 or will we get to 5 >> on the rates? >> yeah, on the fed. >> my gut is that would be a surprising outcome. >> you mean 6% or 5.5% would 4.75 surprise you. >> i've been at a happy land of four, four, and four

4% unemployment, 4% inflation and 4% rates employment at this stage is lower and inflation has been higher but if we get in that kind of zone, we could deal with it. that is an appropriate time to pause and let the rate increases work through the system and see how much that he drive down demand. >> but what if inflation does come back up and pushes inflation higher than it is right now? >> but you're seeing pressure of demand because of the high cost of doing business. so these will work their way up. abnormal was 0% to 1% inflation. we had inflation 8% to 10% and rates at zero, unemployment 3.5% that leads to huge asset bubbles. guess what we had huge asset bubbles. >> the opening up with china is that inflationary or

disinflationary? >> supply chain eases. >> but there is a lot of weird cross currents there. >> listen, we're all projecting. we're all guessing, right. and i think it is the accumulation of bringing demand down, easing up at some of the supply chain issues that have gone on. how wage inflation both salary and hourly employees changes, all of this coming together. but we're seeing -- look at the cpi numbers. it is all coming down. >> i said the asset bubble was clearly there. are we through it? have we deflated the bubble completely >> pretty much look at the s&p. now we're going to have a earnings recession that is going to happen. >> you don't think jay powell will feel like he wasn't resolution enough, you don't think he'll feel that i need to do what i said or else i'm going to lose -- >> his job was to bring inflation down and they're doing that so i think he's being much -- >> he's much bullish. >> so what you do you tell corporates that are thinking

about m&a, do you sell or wait a lot of people don't want to accept the reality of today, say this isn't reality. >> i think it is early. >> we have activists out in force. because they're sighieeing the sharks in the water. >> the signal frankly for the market and for ceo's is rates have paused. now when you walk in the boardroom, you say i've got this transaction that we want to do, directors, let's talk about how this is going to work and you're in a very uncertain economy environment, it better be absolutely strategically critical and some of those deals are getting done we did that obviously with eaton vance in the middle of covid but you need some certainty and that is when i think ceo's could walk into boardrooms more confidently. >> so by the end of the year, you have other people at your firm that we talked to all of the time that do this for you. but you think we could be either

flat or higher than we ended last year? >> oh, but the house call -- you look at what mike wilson has been saying. he's called for short-term bearish call based on the earnings recession, 3,000, or 3300 but his interview, the house call was 3,900 that won't surprise me. >> be 3,300 would. would you say that is a stretch call at this point. >> given the market since january 1st, right. >> no, agree i don't think we're going there. >> that is a house call. but i don't focus on the next 13 weeks or 10 weeks. >> but you're not running and hiding. >> i'm focused on next year and the strength of the u.s. economy and what that does for job creation coming out of the last couple of years. >> i know we're going to run out of time. capital raising and financing. are you thinking about it differently and i'm also curious, i can't let you off the

table without asking you how you feel about the debt on twitter and mr. musk these days. >> can't talk about a single name but i've said publicly that he's a brilliant individual he's created at least two if not three extraordinary companies. we're very comfortable with our position >> do you support -- they cant me to ask you about the debt ceiling. that is like asking the treasury secretary about a stronger dollar >> who wants a question. >> someone in my ear and i'm sure he got it from someone else what about the debt ceiling. >> there are certain things you don't play with fire. >> well we're good at that. >> so i'm hopeful that congress will be sensible about this. the u.s. is -- you know, it is the backstop to the global economy. you are don't mess with it. >> very good james gorman. >> great to be here. >> thank you tell us why you're better? >> far be it from me to say

that but we finally got it. >> thank you, james. when we come back, we have world central kitchen founder jose andres who is going to talk about global food security and his organization's work feeding the hungry in ukraine. stay tuned, you're watching "squawk box" and thiisnbs cc.

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welcome back to "squawk box," we're going from the alps to a different story in florida this morning because a jury

ruling in favor of the rapper flo rida in a lawsuit against celsius and awarding him more than $82 million the jury finding celsius guilty of breaching an endorsement deal with the rapper between 2014 and 2018 and we had spoken with flo rida on squawk about the lawsuit last week. here he is after yesterday's verdict. >> this was a long journey but we prevailed from the start i only wanted what i worked for. nothing more, nothing less i was instrumental in celsius that you know and love today such as myself i put them on my back, and celsius has accompanied me all over the world >> we've reached out to celsius for comment but have not yet heard back. >> that was really interesting i i have to say, in reading the details it sounds like he was getting hosed by the company he made a deal with the team

that he trusted and new management came in and they shortchanged him glad the jury saw that too. >> good for him. >> our next guest wears many hats as a chef, a restaurant owner, a humanitarian, let's welcome jose andres, founder of world center kitchen, the organization working to feed people in ukraine and many other spots around the globe it is in the back of all of our minds, collectively, over here i think, jose, what is happening we had the ceo of uber on and we're hearing stories about how that company is operating in ukraine. you've taken it on, head on in terms of food in that war-torn country. >> yeah. in ukraine we arrived 12 hours after the invasion from russia began. we began in the border we did a thousand meals every day. within weeks we reach over 500,000 hot meals produced by 550 restaurants. run by ukrainians.

for ukrainians we reached 1.7 million meals a day and then bags of food covering the lack of infrastructure, supermarket. remember 50 million ukrainians displaced or refugees and we want to make sure we were able to close the gaps on those places where food was an issue and covering in the short-term the food needs but remember, ukraine has food to feed themselves for the next five years but this is a problem. they're fighting for their freedom and democracy. but in a way they are fighting to feed the world. many countries in africa and around the world will go hungry if the grain corridor keeps not running and ukraine cannot keep supporting the grain the world will be hungry if we don't all together support ukraine. >> this isn't your first -- that is an expression, it is not your first rodeo.

haiti and you are a relief organization now are a restauranteur? all of the above >> i'm opening a restaurant in dubai on friday. i keep opening restaurants we need to keep moving the economy. but they say it is okay to feed the few. but in the process, put your same know-how. and you mentioned haiti. we're in davos, where the deal makers of the world happen what happened in haiti the international community, governments and u.n., we let haiti go down. what i mean, we cannot let ukraine go the way haiti has gone when the big leaders of the world convey moments like davos. it is okay to make promises. but promises made must be kept haiti is an example. we should do -- we must do better ukraine, i hope the international community will

have to continue to support. >> how much does it cost your organization to do what you're doing in ukraine >> we've raised hundreds of millions of dollars. we can only do what we do and people support it. we do not go from racing we go from boots on the ground and start cooking. people see what we do. and in the process, they support us because in realtime they see where they're dollars go the great thing is that much of the money we put to help ukraine, we've invested in ukraine. leaving the money inside of ukraine. helping the keconomy. you know what happened in haiti. we were proud of what we did in haiti. but we gave so much food for free that we put hundreds if not thousands of farmer's out of jobs the haitians that we saw under the bridge in texas 13 years later, in the way we're a

byproduct of bad decisions and actions. doing good is not enough we must do a smart good. >> that is what happened it was -- >> that is one part. >> giving money and not cutting out. so how are you doing it? >> which countries give food to the poor countries when we should be giving knowledge and know-how so they could feed themselves those countries will forever be poor and we'll be having food refugees that is why i've been asking for a long time that every country in the world, when i spoke to the nato leaders in madrid, i asked them, president of every country must have a national security food adviser who we could start making a smart food decisions and then food stops being the problem but food is the solution >> how much of the money is coming from governments, how much is coming from people i know a year ago jeff bezos gave you $100 million.

>> i use a bit of the money bezos gave me to start we had some foundations. but the vast amount, more than 70% is people who give us $10 or less it is a decision of the people by the people. not everybody could go there we had people that came to our big kitchen in poland but all of the people help sending us a dollar they see real action in realtime we're not fighting a hunger organization, we're a food relief organization after like has happened tornados in alabama, our team was in the ground 12 hours floods in california, our team was in the ground in one hour. pakistan, afghanistan, we are there when we feel we could help with something very simple activating the food community to cover the food needs. >> this sounds like a good place for you to be. one of the -- i could see the world economic forum being a force for good a lot of it i'm not so sure.

but in this case, how is your reception here have you accomplished things like that you could accomplish in terms of food raising and awareness and everything else. >> we send the message that we want to send connecting with ceo's that they have huge possibilities of always making huge change. i'm a guy that comes from the business sector. i believe in more business involvement in solving the problems of the world and we must be asking more from agencies we need to be asking for from u.n. and unicef and programs so when they say they are short on funds, if they deliver the goods i'm the first one fundraising for all of them. but we need to start achieving the goals that we clap when somebody gives a speech. sometimes it is too many announcements that they are not even started we must be committed to the big promises to change the world

if not, we talk about how to improve the world tomorrow and that will every in happen. >> that is my usual view of what happens here and you could make a pretty good -- >> it is happening right here. >> we're part of the solution maybe for once that's good. >> thank you >> great to see you. >> appreciate it. when we come back, we've got some breaking economic data. new job numbers are next but before that, let's take a look at futures. you'll see that the dow is now under pressure by about 300 points we started the morning 2 and a half hours ago, were we are down by less than 200 points so here is the weakness that continues after a day where the dow was down by more than 600 points s&p futures off by 34 and the nasdaq off by 101. "squawk box" will be right back.

[music - cover of blondie's “dreaming”] [music playing] ♪ imagine something of your very own. ♪ ♪ something you can have and hold. ♪ ♪ i'd build a road in gold just to have some dreaming, ♪ ♪ dreaming is free. ♪ accenture, let there be change.

welcome back to "squawk box. proctor and gamble reporting year-over-year declines in revenue and profit even as the company worked to offset declining volumes with higher prices for the second quarter, proctor and gamble beat the streets expectations on the top line and matched on the bottom line the stock is off by about 2.p% we asked the ceo about the company costs when he joined us last hour. >> generally, what we're seeing from an input cost standpoint is

prices continuing to rise. but as you indicated, at a lower rate than they were previously with some turnover in the feedstock areas from a commodity standpoint but that will take a while to flow through our in come statements so these are challenges that we're going to plan on and continue mitigating. >> proctor and gamble raised the outlook for 2023 sales growth to a range of 4 to 5% from a prior range of 3% to 5%. and year just a few seconds away let's get straight over to steve with the jobless claims and flu housing data steve? >> yeah, i have 1.382 million on housing starts becky, a little better than expected 1.36 nothing to write home about in terms of beating it. here is the table here i could call it up and get permits. permits were down 1.6% to

1.3 million. that is a little worse than expected, it was 1.35 was expected 1.33 was the number. on the jobless claims front, wow! 190. down 190 if i'm reading this right. c consensus was 214. the data yesterday was maybe a turning point for a lot of folks when it comes to how ugly it was on the retail front, on the manufacturing front, and a lot of people saw that data and said, well, wait a second. this economy may be slipping into recession we're not seeing it here in this jobless claims data. the employment part of the picture seems to remain relatively strong. i don't have continuing claims -- they did rise. but there is still a low level, 1.64 million and i want to give you my number for for the day and it is 79 that is the gap between the federal reserve and the market pricing for year end 2023.

looking at the difference between 2023 and the january '24 contract and this gap of 79 basis points is up near a high we've seen so the market and the fed are in continued disagreement here or increasing disagreement over where things are going yesterday all of the fed speak was about, you know, maybe we're going to go down and go up less 25 basis points. but we're still going up near 5% and the markets is like what are you talking about? we don't understand it look at the ten-year yields and i think i saw the two-year was going to breach the 4% mark. i don't know if that is where it is this morning. it was 407 and back up to 413 and the ten-year down near 32. so a lot of the extra tightness that powell tried to build into the market from the jackson hole speech, a lot of that has gone away and the market and the fed

increasing disagreement. and i'll see you back here i guess on monday from davos everybody have a safe flight >> thanks, steve we're looking forward to it. every data point matters at it point. there is the two-year now. meantime, we heard from james gorman a few minutes ago but earlier we spoke with jamie dimon, and here is what he had to say starting with his view on a possible recession. >> the way we run the company is to serve clients day in and day out through thick or thin. i know there are going to be recessions i don't spend that much time worried about it i do worry about a lot of stuff but not whether -- what the weather is going to be like. and i don't want a recession because it hurts average americans but i have to be prepared for it. >> but there are a lot of businesses here trying to figure out what their budgets are supposed to look like and whether they have to raise more capital and call you for that. that is why -- so what are you

telling them >> i think any business large or small should prepare for a bunch of eventualities and are you building products and services and could you handle input and output prices going way up and way down. >> a global conflict probably would be bad for jp morgan and obviously for all of us. we're in davos it is almost like the russia problem, people almost have it on a back burner oh, yeah, dictators are going to do what dictators are going to do but we have still have nuclear weapons and russia does and we don't know whether that is a possibility. and for every panel on climate change, there isn't a panel on nuclear -- >> the only thing that matters for future of the world is how this plays out the humanitarian crisis, and i read the missiles going into buildings an killing kids every

day and it is nuclear blackmail. this is the most serious issue and in my view could be an inflection point for the western world for hundreds of years. do we get our act together and help rebuild ukraine and then negotiate proper trade relations with china and manage -- >> do you look at this. >> the other stuff is the weather. >> do you look at some people have talked about this as a dress rehearsal for whatever our relationship is with china in the future >> china, americans have to understand, our gdp per person is 75,000. theirs is 15 and we have all of the food and energy we need they import 11 million barrels a day. they have lifted up their society but it is nothing in terms of ours like prosperity and growth and innovation. i want them to do well for their people we have a competitive relationship, it doesn't need to be adversary i'm happy that we're talking to them now >> they say they're opening up it that is the message you hear

everywhere in davos. is that a head fake or is that real. >> they have to do they need to grow their economy and lift up their people to compete in the world out there so the warm-up is -- it is a warm-up to the extent that the western world, trade is not going away and it is decoupling notion but it is restructuring of two types and anything that relates to national security and different for every country, semiconductors and secure and safe and cheap energy which is critical for everybody and food and then when we think there is unfair competition, that should be negotiated. and yes, of course, american should have done this sooner but we didn't. >> soo even zero covid, they didn't get rid of it because of the protests and people were locked indoors they did because gdp was half of what they wanted to be they need to keep growing economically and a war is not going to help. >> so i was talk ting to an

american ceo who had a meeting with the deputy minister here from china making the case to make it -- to come back to china. and to make a significant investment so when those type of american ceos call you, say give me your advice, because they're not sure do i make that investment, that is a long-term investment, it only works if you're there for ten years or month >> right >> you have to be a believer or not. >> it is a hard question i think china is going to be large, civilized nation for 50 or 100 years if you think long-term, as you probably should, if you think about politics, all of the geopolitics are determined by the united states government and the united states government isn't asking the american companies no the to go there the american government has to set policies and guidelines and i think people may wait to see what happened with the trade relationships. that is perfectly rational for those of us already there, we're still doing business ther under american law

i'm a patriot, i'll do whatever the american government tells me to do but you should look at both and be very thoughtful about it and not have a knee-jerk reaction to it. >> and with the debt ceiling, one of the things that you worry about or give a lot of thought to >> we should never question the credit worthiness of the united states government. that is sacrosanct, it should never happen and democrats blame the republicans or republicans blame the democrats. i don't care who blames who. but that is a part of the financial structure of the world. and this is not something that you should be playing games with at all. >> there is a reason that we could sell our debt because ware at 120% now but we could still do it because we're lucky. and we're trusted. but that would -- >> americans should understand that the american financial system is the crux of the financial system of the world. we shouldn't play with that. >> talk about selling our debt the price at which we sell our debt, it becomes a big issue and i know you don't like to

mind read what the future of the economy is, but the other piece is mind reading, what do you think jay powell is going to do because that is such a massive impact on the world and everywhere else. >> and everyone who has forecast this has been wrong. including the fed. >> you're talking about the recession piece or what they're doing about it >> yield curve, inflation and the whole thing. so as a business, be prepared for all it i tell eople, i go to my board if x happens, if y happens, i give it probabilities. i think rates will go higher than 5%. >> higher than the 5%. >> that is my view because i think there is a lot of underlying inflation that won't go away real quick i think we have the benefit of china slowing down and oil prices dropping, i think oil and gas prices will go up and it is already a fragile system so one terrorist bomb and you could see what happens to oil prices and so i think we should be very -- and wages aren't going up that much people left the work force china isn't going to be

deflationary any more. there are all of these other factors taking place it may be more than that but again, if we had a mild recession, rates go to 6%, we're all fine. >> we might have a mild recession at 4%. at 6% it is not a mild recession. >> we look at all of that. whenever you put on the yield curve, i would tell you how we deal with it and stuff like that we're not betting the company on guessing what interest rates are going to be. i think they'll be higher. >> and not what you think about the company, but you have a lot of high net worth clients and the like who you tell or try to advise them about what to do with their money given what you think is happening, what are you telling them >> i don't give financial advice for a lot of different reason. >> what is the dimon family doing right now. >> i own a lot of jp morgan which i think is going to do quite well >> jp morgan or more bitcoin is it basically? >> what is bitcoin no, i'm much more jp morgan.

>> when you talk about probabilities, you have probabilities for some of the long tail events that you talk about too, that you present to the board? >> some of the fact tail ones that are bad, i say it is small. but if it happens, what does it mean to us we have to be able to survive anything with the fed, we do this stress test, but we do a hundred a week a hundred a week. >> there are certain things you can't survive. you can't survive a nuclear event. >> war would be a whole different issue, yeah. >> as much -- you survived it easily but nothing something you're proud or happy about which is this issue about frank. this business that you bought that was clearly now a fraud what was the lesson of that? >> oh, i'm not going to talk about that particular thing. there are always lessons we'll always make mistakes i tell people to make mistakes it is okay and when we know what all of the lessons, i'll tell you what they were but i don't people to be afraid of making a mistake and that is a bad way to run a business.

>> you could make a small mistake. that was -- that you could argue was a small mistake. you can't make big mistakes. >> we made some big mistakes sometimes. >> do you have a opinion on what is going on at goldman and if david called you and said, jamie, i mean i've always admired you, could you just give me advice on. >> now you're friends. and i know what they're going through. but i told david, they did a good job doing better than us in some of the investment banking this year. so my hats off to him on that. and i don't know the consumer side that well we see the same numbers that you do >> he mentioned bitcoin and you said you didn't know what we were talking about we pretty much always have some crypto conversation with you. >> i think that is all a waste of time and why you waste any breath is beyond me. >> because you think the whole thing is going to zero and is fake. >> bitcoin is tself is a hyped

rock. >> who do you make of black rock and other firms investigate investing in infrastructure. >> we move to use information and over night intra day and we're going to use it to move money. so that is a ledger. that is a technology ledger that we thinkwill be deployable we've been worried about that for 12 years and very little has been done. >> but bitcoin is based on a distributed -- >> it has all of the character cystics of a store of value. it is immutable and it is scares >> it is 21 million. >> how do you know it will stop at 21 million. and maybe it will get to 21 million and sit oshie will come and laugh at you all and by then -- >> what was your reaction to the failure of ftx and all of that

you've seen a lot of failures given on wall street and the world of finance. >> i'm not surprised at all. i call it a decentralized ponzi scheme the hype around this thing is extraordinary. >> but you have a lot of clients who are involved -- >> you guys have all seen the analysis on tether and the lack of disclosures it is outrageous the regulation should have stopped this a long time ago people have lost billions of dollars. if you look at lower income people, it is some -- in some cases it is -- >> is it different from saying ftx is a decentralized ponzi scheme in saying that crypto itself is a ponzi scheme that is like -- madoff creates options. >> it doesn't do anything. it is a pet rock >> bitcoin >> yeah. >> you could own it all you want i'm just talking -- >> it is billions of dollars. >> i don't care about bitcoin so we should drop the subject >> and that was just some of our

conversation with jp morgan ceo jamie dimon. pet rocks and all. a lot to chew on there before the economy and so much more >> well, i don't know any pet rocks that are still trading for $20,000. so he said it was a pet rock at 2,000, 8,000, 18,000, 25,000 if you have someone, someone will give you 20,000 for it. and if it is going to zero, i would be surprised >> we'll see >> coming up jim cramer first take on the trading day ahead. that is coming up next but he's not here but we're going to have him. and check out squawk pod features the best of our davos interviews that would be a nine-hour show listen to the squawk pod report wherever you get your podcasts we'll be right back. this is ge aerospace,

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welcome back to "squawk box. jobless claims released just moments ago. claims coming in at 190,000 which was below expectation. take a look at futures because it looks like we're ole lower, about 300 nasdaq looking to open lower as well right now you're looking at the nasdaq off about 112 and the s&p off about 35 and treasury yields, we've been debating it all morning with so many others, ten-year note sitting at 2.3413 and two year at 4.122 want to get down to the new york stock exchange and check in with jim cramer and get your take on p&g and the data and your

comments on comments from the likes of jamie dimon and james gorman >> sure, look, i'm in the gorman camp which is basically that this is a garden variety sell-off because, again, a couple of rate hikes. i agree with that. i'm not worries about the 6%, jamie dimon. he's a cautious guy, he said that stuff good guy, he wants to give you the down side. your interview with proctor, everything he said that was true but he reported on the wrong day. he reported on friday. the stock would be up for dividend aristocrat and hedge funds were short and you cover at 140 there is just a lot of what i regard as being business as usual after big down day and your coverage has been amazing but the coverage is basically like my friend -- it is not so bad. and we want to look at the 20 year and say that that was more than we do the 20-year doesn't talk

it doesn't have anything to say. >> so but are you -- we keep going back and forth yesterday i think people would have said optimism, optimistic recession, and soft landing and then today things have shifted and i have shifted and i think the big question is, which is it at this point? >> well, look, i think the market got overbought. china's opening. india's very good. i see diplomacy breaking out where i didn't see it. i know that oil's got a bit underneath it. you know what, andrew? it's just -- it's fine but fine's never good enough for the hedge funds. they want volatility they need something to happen so they can prove to their investors that they handled this period well. let's do this. let's listen to the calmer people over there and say, okay, i think they make a lot of sense. >> jim cramer making a lot of sense this morning as you always do we're going to see you in just a few minutes and we're going to come right back from the alps to

wrap up our time here at the world economic forum in davos, switzerland. back after this.

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welcome back to "squawk box," everybody. we are almost ready to wrap up our time here at the world economic forum in davos. we have talked a lot this week about inflation and whether the fed is on the right or the wrong track. in fact, here's bank of america's ceo brian moynihan talking about just that. >> the reality is that i think they have to be more careful where they are now because they can overshoot. before they weren't taking inflation on, to your point, year and a half ago, people were telling us, this is transitory they went by they're going to be resolute to prove that they have it. on the other hand, they've got to be more careful of overshooting >> goldman-sachs ceo david solomon was one of our special guests yesterday despite some tough earnings numbers, solomon sounded an upbeat note for the bank >> we're focused on executing our strategy we made a lot of progress over the last few years we got more to do, but i think the firm's incredibly well positioned, and we have a business mix that's very

sensitive to capital markets activity and asset prices. we're trying to evolve that, but we still have a distance to go, and we're working on it. >> we've also talked about employees in the state of labor. uber's ceo told us that his company wants more workers >> we need more drivers. we are now the single largest source of work in the world. there are five million drivers not gig work work in the world. there are five million drivers on our platform, and we could add another 500,000 drivers tomorrow and they would have work so, we absolutely need to add drivers. >> and finally, we've talked about the markets and whether portfolios are set to grow or shrink here's what the carlyle group's david rubenstein told us >> in my own view is that the best time to invest is when there's some uncertainty or when the economy seems to be a little bit nervous. that's the time to invest. it's a good time to invest now

because i think the markets are not going to see another 20% drop in public prices. i think that'sprobably past us and i think we're probably coming back to the point where people are going to feel very comfortable investing. >> okay, so, if we have to look back at this week and try and take away some sort of a theme, look, i came into this thinking that ceos were going to be a lot more pessimistic than they have been a lot of people are worried that a recession is coming, but when you talk to theceos themselves they feel pretty good. >> i'm bullish >> that's where you're coming out? >> we have had not only the governors, the senators we've talked to, the ceos we've talked to, they say, i can meet with six months worth of people by coming here if i schedule my day properly the shows that we put on here, have we not had a line-up that would take weeks to probably plan so, the more it's criticized now i'm starting to like it and i'm not davos man. we know who davos man is

>> thank you very little >> you are davos man but i like it, and i think it's productive >> do you think, though, that the optimism that we're seeing here or at least the less pessimism -- >> is a counter? >> no, is either a counter to anything or is real? because last fall, if you remember, there were so many ceos who say, in my own business, i'm not seeing it, but i think something bad's about to happen this time, they're saying, you know what? i'm not seeing it but i'm going to be optimistic and i can't really figure out which is it. >> the optimists that we have talked to are kind of going -- they think they're going against the grain, so i don't think we can say that -- certainly not frothy what's happening here. i think it's -- these are guys that would know, seriously, better than most people. >> i was going to say, most of them have really good views of business >> not infallible. >> most of them don't see everything some of them have a broader view than others. most of them know what's happening in their business. they feel better about the supply chains, better about inflation, better about labor, about being able to find people.

>> and you know, you talk to jamie, and there's elements of what he's saying with ukraine, with war, with the price of oil and if there's any kind of shock in the system, are we ready for that >> no one. s no one wants to decouple i've become more global. with china out of the picture, we don't -- the world needs china. and i have sort of come to that conclusion, and yeah, i think so we've seen what the world looks like when we're going to isolate ourselves, and it's not going to work we can't go back i don't think you can put the genie back in the bottle oh my god, the stockholm syndrome has set in. >> first time we came here was 2014 >> i'm feeling global but acting locally. >> my goodness this has been like a complete gift, as it always is. >> it is look, i have to say, getting through and hearing all these guests does give you a really good reset for the year, good way to jump into january and try

to see what's coming, and i think it makes us smarter about all the conversations we're going to be hearing from here. we should take a quick check on the markets. >> they've moved around the entire time we've been here. >> we have gone between inflation, recession, inflation, recession six times since we've been here. >> like the conversation we've been having at the table >> but i predict we will be back here again next year, and i think people want to be here, and when you walk through the conference center -- >> will they be back here with a smile on their face or a frown >> that's a good question. i think it's going to be -- you say it can't get worse than last year hopefully that's true. last year was rough, end of the pandemic, down 30% on the nasdaq i think, you know, things -- clouds might be lifting. >> hope springs eternal. >> it does in the alps >> we've got "squawk on the street" coming up in about 30

seconds or so. we heard from jim as a sort of a prelude to what he'll be talking about. i don't know if -- maybe he'll talk about jamie's comments on bitcoin. >> pet rocks and all >> we'll be back where will we be we won't be back tomorrow. >> "squawk" is going to be on tomorrow we got a big show tomorrow with our friends who are going to be hosting for us >> we'll be back on monday thank you, everybody right now, it's time for "squawk on the street. ♪ good thursday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer and david faber. premarket is adding to losses. mixed bag of data, but jobless claims falling to 190,000 means that yields are higher across the curvem our road map begins with the soft landing scenario. plus jpmorgan's ceo, jamie dimon, is still pointing to plenty of economic clouds, saying there is a lot of unrl