400 points and close higher. the nasdaq stayed down yesterday. markets are about to get more economic data and earnings reports to drive today's action. it's like a beach ball market this year. tesla topping expectations ev maker reporting strong results to finish 2022 we find out what could be on the road ahead meta reinstating former president trump's facebook and instagram accounts trigger away it is thursday, january 26th "squawk box" begins right now. >> good morning. welcome to "squawk box" here on

cnbc we are live from the nasdaq market site in times square. i'm rebecca quick along with joe kernen and andrew ross sorkin. andrew, welcome back >> thank you >> you had interviews. we are tired of carrying your water. >> you miss me >> we did. heavy earnings season. lots going on. in addition to getting up at 3:30 and splitting everything in half we are not complaining >> welcome back. let's look at what is happening with the u.s. equities this morning. things have not budged much. the dow is flat. bouncing back and forth. yesterday, as joe mentioned, there were headwinds for the dow after the componented that reported weaker. we went from down 400 points in the early going. the index managed to finish in positive territory the nasdaq and s&p turned

around the nasdaq was down 20 points. if you see right now where things are holding, it was weird. if you looked at the biggest gainer, mcdonald's amgen was the biggest decliner treasury yields are higher 10-year treasury is not back to 3.5% 3.47%. 2-year treasury at 3.416 natural gas dipped below the $3 level since may of 2021 you can thank the warm weather we have seen here and around the globe. we have earnings to report on the calendar. we have several airlines coming up southwest, american and jetblue. we will get news from comcast. the mother ship, parent company of this company and nbc universal at 7:900 and intel and

visa after the bell. at 8:30 a.m., another number with economic reports. those include the first reading on first quarter gdp calling for growth to come in at 2.8% weekly jobless claims taking on importance after many companies announced layoffs. economists expect 205,000. durable goods with another read on the consumer. that number expected to increase 2.4% a lot of things to watch >> boeing made back nine points. it was 203 at one point yesterday and closed up. up 70 cents at 213 nothing. i guess boeing is going to make delivery numbers there's the chart. chevron plans a $75 billion

buyback. that is substantial. triple the size of the previous authorization revealed in 2019 it is hiking dividend by 9 cents a share to $1.51 the oil giant making the announcement ahead of the earnings report which is expected tomorrow morning. we will talk more about this with brian sullivan coming up later in the half hour i don't know what this is. we had amos on yesterday they are not real pleased when the majors use some of what they call windfall profits for buybacks >> this is going to spur -- >> then again, they would say we're no longer the way we were 20 years ago because of the uncertain future for fossil fuels, we are returning more cash to shareholders

>> chevron has increased production in the united states. the strongest they have ever produced in the united states. >> they have to pay 1% tax >> on the buyback. >> right. >> that is for schwartzman and the other guys david rubenstein we had to do that. we got rid of carried interest someone got to sinema. >> i do. >> you make all these phone calls. what happened? >> i don't know. we talked about this >> i know. why don't you know are they clamming up when you try to find out? >> yeah. nobody will give you a straight answer >> that would happen carried interest finally. the last minute they switched. >> krysten sinema. >> she's got a big future in private equity hedge funds perhaps, right >> it's possible ibm reporting results after the bell the tech giant posting stronger

revenue and that was driven by the software full year came in at $3 billion more than a year ago on top of the results, ibm announcing layoffs 3,900 employees which is 1.5% of the work force ibmshares are down 2% this morning. i did speak with the ceo yesterday about the numbers. what was interesting is he said back in october he expected to sea see weakness in europe that never materialed. numbers were very strong big deals came through the cash flow was lighter than predicted at that point. that is because the deals got done at the end of december. the cash flow will not be helped until this year. they are doing 3900 layoffs they are not seeing business slowdown they are not one company that

sue ex saw extremes in covid. they are anticipating doing thousands of hires this year both in consulting and infrastructure those businesses are doing well. we will see. stock is down this morning he feels good about the business >> $120 billion company now. you would expect -- i would not call it big blue >> he has done a good job. >> tiny blue former blue? >> blue. >> blue. microsoft is almost $2 trillion. >> yeah. >> little blue let's talk about big tesla i thought it was good news some people thought it was mixed. i thought it was better. tesla reporting better than expected results elon musk making comments on the call let's get to phil lebeau

phil, i thought it was fascinating what he had to say >> i think it was one of the better calls from tesla and elon musk some calls have been real duds and some confrontational he was upbeat yesterday. key numbers to look at yesterday's report they beat on the top and bottom line record profits for the fourth quarter and quarterly profits for tesla. up 37% in the fourth quarter the gross auto margin is getting atte attention. it is coming down at 24.3% the street at 26.2%. they cut prices in china to stoke demand here is musk on the call talking about what they are seeing right now with demand. >> demand sees production and we are actually making some small price increases as a result.

>> the other stat that came out or projection that came out from tesla yesterday is what it expects to do in deliveries this year they delivered 1.31 million vehicles last year they are expecting right now to deliver 1.8 million this year. do the math. that is less than 40% growth not the long-term projection which they are sticking by of annual growth of 50% they have to be closer to 2 million vehicles this year musk on the call was asked about that here is what he had to say >> our total production potential is actually closer to 2 million vehicles we were saying 1.8 because there is always some fricking force

ma majeure somewhere. we don't control earthquakes or pan pandemics. >> that is musk's way of saying we can get up to 2 million that is not the guidance official guide and is 1.8 million vehicles guys >> i remember throng that line if you are an analyst doing match, do you think that number up to 2 million? >> hard to say i think the analysts were close to 2 million they may bring down guidance or projections a little bit on tesla's guidance i'm not sure they will adjust a ton. i think you still have people on wall street who had it at 1.5. they are likely to keep it close to that. >> in terms of margin and how much -- it sounds like he is bringing prices up again

how quickly will that happen >> they had very incremental and small price increases since the price cuts have been in place within the last couple weeks i think they always had fairly fluid pricing on the model y and model 3 in particular where it has moved up and down a few thousand dollars you will hear from people saying it went up a couple or came down a couple thousand. that is not a huge surprise. what i think, andrew, is that big cut we saw the beginning of the year to bring the model y under the threshold to qualify for ev tech? i'm not sure we will see another big cut again. there is demand if you listen to the conference call. elon musk was, i would not say super bullish, but optimistic. >> phil lebeau, thank you. we will continue the moosusk

conversation. musk is looking to pay down twitter debt the billionaire held talks about raising $3 billion to repay the $13 billion in debt related to the buyout of the company. people familiar with the matter say it was about selling twitter shares he does have some big payments that are due and i think $3 billion of that is the highest level. 10% plus the discount rate which is close to 15%. that is the part they want to get rid of quickly >> the question is i would buy down the debt. that is what i talked about the whole time banks are sitting with this is stuff. 50% and 60 cents on the dollar if he takes that out, that is a better way to do it. >> just wrote down 56 cents on the dollar. >> if you buy that debt back, that solves a lot of the problem. >> you still have to sell

shares. >> are you okay? hangover hangover from the sickness >> little bit. >> coughing over there >> little bit. >> two arms length away. closer to the beck-ster there. >> you want me to go over there? >> not for me. meantime, former president trump will be allowed back on facebook and instagram you have accounts on facebook and instagram. >> you know i don't. >> meta will restate his accounts in the coming weeks after a two-year suspension following the january 6th capitol hill riot. president of global affairs saying the public should hear what the politicians are saying, the good, bad and ugly, to make informed choices at the ballot box. >> craig talked about that

decision yesterday i'm monitoring rob reiner on twitter. he could not resist. 17 hours ago he did tweet. prior to that was january 24th he is trying he is trying his best. i just think he can't help himself. i don't know if his head exploded or what i'm keeping an eye on that do you follow him? >> i think it is better to keep an eye on president trump. >> he's not back on it >> not yet. >> keeping an eye on him you need to keep an eye on rob r reiner. will it be the data or earnings that push or pull the markets? we will have more on chevron's big buyback news and what this is saying about the sector itself. u e watching "squawk box" on cnbc

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take a closer look at the markets. i mean markets stocks and bonds start with sri kumar sri, things are playing out as you expected or as you thought they would we may see 4%.

may. you are not ruling that out. you have said for a while that probably be close to the highs for the 10-year treasury the markets still don't believe the fed. you say there is good reason for that why? >> exactly i stick with my positions, joe i think we have come down from the 420 to 425 level trading to 50. the distrust in the fed and wanting a rally no matter what fed officials say is still going on that is a major problem for the fed. whether the 10-year treasury goes back to 4% or stays at 3.50 or 3.75, the fed needs to control the rhetoric and market. it is not. the fallout for investors is that as the result of that, the fed will have to do a lot more

to convince markets which they are not going to do really for instance, next wednesday, i think they should raise rates by 50 basis points even though the common expectation is a slowdown to 25. if you do that, you will give more ammunition to the market to distrust the fed in future months >> david, you have similar thoughts, i think? i don't think the stock market is going to be able to enjoy its recent successes because it just feeds the -- it is actually counter productive for future gains because it makes the fed's job harder the more rally we see in the averages. >> good morning. the fed's job is hard t. is important to keep control of the market and expectation and continue the fight we think the 25 basis point next

week i have sympathy maybe the fed is easing off on the brakes too early. nevertheless, we think that long-term yields climb when we he get past the debt ceiling fight and past the worst of slowdown we expect in the economy. the 10-year treasury does get to 4% probably. between overnight rates at 5% or higher and 10-year treasury at 4-ish percent, this is a powerful number on equity. let's focus on earnings. we are a third of the way through it it is mixed so far stocks are not going down in a big way. nor normally, stocks rally we have not seen that either we continue to watch the earnings as they come in what we are seeing is we are on track for flat earnings, maybe slightly down earnings that's probably the best that we get all of 2023 as well.

>> you figure the s&p is still range bound, david 3600 to 4100 how long -- how long will it be range bound and what will the next move be if it gets out of the range? will it be 4101 on 3599? >> eventually we will get above 4100 i don't think we will see 4100 sustainability until the end of the year for ma oost of the year, i expe that to be the prevailing range. earnings which should be resilient despite the small recession in goods and manufacturing, earnings will be resilient, but interest rates will be a powerful competitor over the course of the year. >> sri, that plays into what you are saying why not buy a two-year for 420

you don't have much duration risk there, really a year from now, you could earn had 4% for a year and sell it at par and go into equities is that what people are doing? that's why it is tough. >> absolutely. at 420, the 2-year treasury is providing a lot of competition to equities. the 2-year treasury will win out. especially if you have, as i believe, there is a recession coming that recession in turn is going to bring down the ease and 4.20 on the 2-year treasury is a nice place to park your cash. joe, very little duration risk you can sell without much loss and go to equities if there is a correction the 10-year treasury is also starting to look very good if you are at 3.50. it could go again to 4% and you lose money, but if you are going

to be keeping your money for two years or three years ahead, i think you will do quite well on the 10-year treasury long duration and fixed income is good competition right now for investors. >> the only thing, david, that might throw a wrench in the works is if we do see the employment picture worsen quickly and faster pivot than people are expecting this market is saying it wants to go higher you have seen it from the beginning of the year. down 400 yesterday bitcoin is back to 23,000. there is a risk-on trade if you wait until the end of the year, the train may have left the station. that is a risk >> patience makes sense right now. short duration, we think it is a good place to be if you want reward versus risk,

look at china stocks stick with healthcare for the long term. >> david and sri, thank you. see you soon. >> thank you, joe. you're welcome >> check out shares of chevron this morning announcing a massive buyback stock program. we will get into the details and what it signals for the sector next wow, we're crunching tons of polygons here! what's going on? where's regina? hi, i'm ladonna. i invest in invesco qqq, a fund that gives me access to the nasdaq-100 innovations, like real time cgi. okay... yeah... oh. don't worry i got it! become an agent of innovation with invesco qqq

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welcome back chevron plans a massive $75 billion buyback. that is triple the size of the buyback in 2019. brian sullivan is here with the

details. that stock right now up 2.8% this is a really big move, brian. >> the big number, becky when the headline crossed, i was walking around town and thought the decimal was in the wrong spot che chevron, an oil and gas giant making giant headlines authorizing a stock buyback of up to $75 billion. it is authorized up to 75 billion. that is one of the biggest on record apple's is $89 billion that is $14 billion more than chevron. it is still big. the run rate is $3.75 billion per quarter if they do it. here is what is amazing. the buyback is 20% of the chevron market cap at five times the size of the current plan i know you spoke with mike wirth

many times brent crude to lead to more buybacks they are raising dividend by 9 cents a share to 1.51$1.51 a sh. the ball is in exxon's court chevron up 30% for the ear. we will see how good it has been chevron earnings due out tomorrow morning expectation is $37 billion for the year peopleare saying they are not spending money on new projects they are $17 billion this year. that is up 2 billion from last year that is well lower than the $40 billion in the capital expenses chevron spent in the go-go days of 2018.

$75 billion buy bback i'm sure we will not hear in any politician about this. please note the sarcasm. >> they probably realized that will be push back they get from washington their response is just that. they are producing more energy and more oil than in the past. we asked them about the amount of cap x he said they are more effective and efficient with it. it requires less cap x than it costs to produce this is going to get for from us washington. >> brian, let's say we all of a sudden -- let's say people say we don't have to worry about emissions. we really don't. we need to just continue to try to fund this unbelievable lifestyle that fossil fuels have given the world for the past 100 years. unprecedented in the last 4 billion years. this is as good as it gets in terms of traveling high speed

across the ocean and global trade. what if it got to the point we want to maximize production and not worry about it the 75 could be well spent still looking. it is not spent looking. there are enough projects to do that, don't you think? >> there are enough projects i don't think there is enough people or equipment, joe from the macro messages -- >> you wouldn't go into that business i won't go into that business if i was an engineer at this point. i would go into whatever people are going into now to try to provide energy maybe nuclear. it is all one -- >> that's right. >> it is a declining industry. whether you like it or not >> you wind it down and give the money back they keep it going or putting wells in ground which nobody wants, but they don't want to give the money back. i don't know the answer.

>> they have pressure from all sides to give the money back and stop and go to carbon capture or whatever activist pressure. the place with 1.1% of shares. pressures them to stop looking for poison and pollution thanks, brian sullivan coming up, soft or hard landing for the economy. recession or no recession? a week away from the next fed decision with the economic data on the way we get into the recession risk and fears of those next. last time barry sternlicht, he was slamming the fed. he has his take on the economy maybe the onecomy is better than the last time. i doubt it "squawk box" is right back >> announcer: executive edge is sponsored by at&t business at&t 5g is fast, reliable and secure

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welcome back to "squawk box. just about two hours, we will learn more about the economic growth of the nation with the

fourth quarter gdp expected to show the economy grew at a slower pace in the final three months of the year with us is the president and founder of macro policy perspectives what number are you looking for and what are the numbers underneath the numbers that you think we should pay attention to here >> so, we're below the bloomberg consensus at 2%. that's still a pretty impressive showing given the year we had and how far the fed tightened policy and how much we lost on fiscal support we're looking for consumer resilience, but definite slowing. we had a cautious holiday shopping season. i think we're looking at growth that's right around trend and slightly below trend under the hood residential investment is a big

negative in that gets 2023 off to a pretty sluggish start the most recent data, december data on consumer spending, showed a lot of caution. >> we have been living in the jay powell bad news is bad news and good news is bad news situation. is that going to return? >> i think we have seen enough slowing in the economy and very importantly enough good news on inflation that the fed is comfortable stepping down. they are still tightening, but not at the speed of last year. we are expecting a 25 basis point rate hike next week. maybe one or two after that. we are not far from the peak funds rate then the fed plans to hold it there for a while and let the economy struggle through a period of sluggish growth or recession. i think right now that's a pretty close call. >> you are not in the category of thinking things are going to

be better than -- i say better, but better could be worse. that is the strange part about this >> yeah. >> hotter may be the better word to use here. >> we are in the soft landing camp let me be clear. we have been i think the data is rolling in consistent with that the key is the job market has been so resilient. we have seen aggregate hours work decline there are layoffs in some sectors and overall labor demand is cooling off we have not seen mass layoffs or the unemployment rate rise we are seeing wage growth moderate that is the key for the fed. if the fed can take its foot off the neck of the economy and then pause even at the higher level of rates which is a drag on activity, but stop tightening, and we think that will happen at the end of q1. march will be the last rate

hike that gives the economy enough room to breathe. one of the keys to the outlook here is productivity it has been pretty abysmal through the pandemic most recent indications are productivity may be picking up there's been a lot of investment and turnover of workers is slowing down and supply chain frictions are easing. >> what do you think the unemployment rate ultimately goes to? >> we don't have it going above 4% that is a near miss as far as recession. once you rise 1% or more, you are in recession we think we skirt that we will get some increase in unemployment, but not enough we are looking at mid '90s scenario rather than full-blown recession. a soft patch and enter the next phase of the expansion

>> julia with the goldilocks scenario hope springs eternal thank you. >> thank you all right. let's check out bitcoin this morning. under 23,000 again, that is up almost 40% since the start of this year we will continue to keep an eye on it. when we come back, congress organizing a sub committee around crypto regulation we will talk to congress member french hill. that is coming up in the next hour "squawk box" is coming right back >> announcer: currency check is sponsored by interactive brokers. the professionals gateway to the world's markets.

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dow at least is now in the red the nasdaq, which at one point was down almost 2% yesterday, rallied and closed lower it made a good comeback. that is up this morning. i guess tesla is not hurting after the results late yesterday. energy prices. this is a wild card with china reopening. $80. is that the floor? what would it do -- i saw people yesterday say to keep production up, we should put a floor. >> i have seen that. >> the oil companies are never incentivized >> you believe the market on the upside and not the down side >> i was there for whip inflation now and wage price control under the previous guy tricky dicky

why are you laughing i like him now i do >> nixon's your guy? >> he did a lot of really good things >> he's not as bad as -- >> yeah. by comparison. he seems pretty good normal when we come back, we will get a different read on the c con consumer tractor supply with stronger than expected results. we talk to the ceo about the recession fears and spending and supply chain that's next. you can get the best of squawk pod on your foravite podcast app and listen to us any time we'll be right back. 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. ends monday. how do we show strength and stability? (eagle call) a mountain? a tree weathering a storm? (thunder) lions? nope.

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welcome back to "squawk box. we got news. southwest airlines just crossing with the results and itis a miss phil lebeau, tell us about -- i don't know what to say >> andrew, to say it is a miss is an understatement this is a miss by a wide margin. loss of 38 cents a share street with a loss of 12 cents a share. it was the meltdown after christmas that is the issue. the total loss or impact of that meltdown $800 million. that was the total impact. within the range of $725 million and $800 million for the flights canceled with the scheduling issues compounded by other issues within the company. for the tyear, they turned a profit when you look at the q4 results, the street with a loss of 12

cents a share. some people said i would not be surprised it would be wider than that lots to discuss with southwest ceo bob jordan you don't want to miss that on squawk on the street with him at 9:30 a.m we will talk q-4 results, not only about the scheduling meltdown at the end of the year, but more importantly, what are they doing to make sure this doesn't happen again. as you guys know, they did not make the investments that people were expecting them to make over the last couple of years and that's the main reason for the meltdown we'll talk with bob jordan about that. >> you saw the first quarter stuff, right it's continuing. seeing a rise in flight cancellations, bookings, and the negative revenue impact in the first quarter is 300 to $350 million from what happened in december. so that's a bad -- the last three months and january is bad.

>> yep joe, this is the lingering impact and i've heard from some southwest employees, more than a few, who have said we're concerned about people booking away people who were stranded for days are like, not flying southwest any time soon. there is also the residual impact that there may be people who, when they're looking to book a trip, are saying, do i really feel comfortable booking with these guys. can i go with american if i'm here in dallas or do something else whatever the reason is there is that lingering impact and that's what you're seeing in the guidance for the first quarter. >> it's not over yeah. >> phil, thank you we will see you in just a little bit. >> you bet >> in the meantime, tractor supply reporting better than expected earnings. growth for the quarter was up by 8.6% for the comp store sales. transaction count was higher, the rural lifestyle retailer has a unique read on the consumer with its 2100 stores in 29

states sales have increased 70% over the last three years joining us right now is the ceo. there are a lot of pandemic play where is the stock saw a lot of activity, but that went away after people went back to their normal lives that's not the situation you have with tractor supply >> good morning. and thanks for having me on the show and thanks to our 50,000-plus team members for all they do every day. we've had a fantastic last three years as you just said over 70% revenue growth in the last three years big growth in 2020 big growth in 2021 and then on top of that, another remarkable year in 2022. we would attribute it to first our business model, the market we participant in, the share we're gaining, the investments we're making, but we're benefitting from a lot of structural tailwinds

revitalization is real, the millennial generation is moving to the sunbelt, migration, and we continue to see pet adoption pay dividends as well. it's a good time for rural america and it's a good time for tractor supply. >> i noticed in the release you say that you continue to gain market share where are you stealing the market share from? who do you compete with? are you competing with pet stores, home depots? >> we're a lifestyle retailer. we sell everything from apparel to pet food, animal feed, agriculture equipment, to seasonal and garden businesses all really focused on that out here lifestyle so we compete against thousands and thousands of different types of retailers. but really across the board, we're gaining share. notably in categories like pet food and poultry poultry is a category that is in its fourth year of remarkable growth in pet food, particularly dry dog food, we're growing two

times the market in dollars and three times the market in poundage and we're serving, particularly during this kind of period of economic activity, almost like a club store in terms of -- we sell 40 to 50-pound bags of dog food. across the board, our share gains, but i would point to those two categories as examples of some marked share gain. >> gross margins were really strong too the gross margin increased 28 basis points you were able to raise prices even more than the rate of inflation. >> the team has done an excellent job navigating kind of gross margin rate. it's our view that inflation has peaked we're seeing less cost of goods increases come in both in frequency and also in magnitude. the freight market is starting to turn. and we're optimisticthat as we head into 2023, inflation begin

to moderate. we think it will moderate and in the midst of all, we're able to navigate it very well between pricing and other actions to maintain our margin structures both for the year and for the quarter. >> last couple of weeks we've heard from some insurance companies that got hit hard by that storm in late december. that cut into their profits because they had so many things they had to cover. it actually helped you that storm. what happened? >> we're a needs-based retailer and we're there for our customers and good times and certainly and hard times when that storm came through, the types of products we sell are well suited to support our customers in those times whether it's anything from salt to heaters, to propane and heating fuel or even just pellet -- even just pet food and animal feed, forage, all those sorts of things, heating blankets for horses. all those are sorts of things our customers need when the

weather gets cold to be able to maintain their pets, animals and their land and their homes >> if there's anything you worry about, what is it? >> the main thing i worry about is our culture we're celebrating our 85th anniversary this year. we've grown from one store to 2300 stores and 14 billion in revenue, 70% growth in the last three years. we've got some significant expectations for '23 and beyond, and it's so important as we're growing at the rate we are that our culture is keeping up with that and we're able to maintain that uniqueness of tractor supply and living our mission and values every day. >> how do you supply anything for tractors parts? is there one -- >> we do tractor parts tractor parts. we don't sell tractors, we sell everything but the tractor. >> shirts and dog food -- >> tractor supply. it's a cool name and a great culture. i could just browse in there too.

it's my new favorite place. >> it's my favorite coffee mug thanks we have some breaking news economic news that could way the markets this morning and another big dose of earnings reports, including results from the mother ship, parent company of this america and more, comcast "squawk box" coming back with two big hours ahead. >> announcer: squawk ceo call is sponsored by truist wealth where meaningful relationships matter most. an approaching car, a puddle, and knew there was going to be a situation. ♪ ♪ ms. hogan's class? yeah, it's atlantis. nice. i don't think they had camels in atlantis. really? today she's a teammate at truist, the bank that starts with care when you start with care, you get a different kind of bank.

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good morning, everybody. lots of earnings today we're going to break down the latest reports and bring you numbers from parent company comcast and private equity firm blackstone tesla reporting better than expected reports after the bell and elon musk making some comments on the call former ford ceo mark fields will share his take on the quarter and the growing competition in the ev market. a new committee being formed to take a look at crypto the lawmaker running that committee joins us to talk about what's in store for digital assets as the second hour of "squawk box" begins right now. ♪ good to "squawk box" right here on cnbc we're live at the nasdaq market

site timessquare. i'm andrew ross sorkin along with becky quick and joe kernen. we've got a lot of earnings and other data points coming out as we speak let's show u.s. equity futures at this hour a lot of this is going to move around before we open. right now the dow would open dow 16 points, the s&p up eight points you're looking at the ten-year note standing at 3.484, the two year at 4.148. and then oil, you're looking at the wti right now at 80. and bitcoin under $23,000. 22,990 but right now some big news out of our parent company. >> the parent of nbc, cnbc, universal theme parks, all that, out with results the company recording record revenue and adjusted ebitda for

the full year. now we would never talk full year, but so for the quarter, let's get to the actual numbers we need. for the quarter, adjusted eps came in at 82 cents per share. that's a nickel above. revenue of $30.55 billion just topping estimates of 30.32 billion. the company also increasing its dividend for the 15th consecutive year to $1.16 a share. you can see the knee-jerk reaction is down about 1%. there are -- as there always are, myriad metrics when you're considering a company as large and diversified with all of these various moving parts there's a couple of things, guys peacock, as a result of investments in peacock, nbc universal, ebitda decreased 36.3%.

817 million, reflecting higher peacock losses and 182 million in severance expenses at headquarters and elsewhere as usual, we did see some cord cutting, but it was ability -- i think it was slightly less than what people were expecting was it 400-plus and the company -- the throwaway line was always comcast is not going to chase unprofitable -- >> it's been the line we've heard from at&t and others you don't want to chase what they call -- >> the broadband numbers and the additions look like they're at least above expectations of the theme park business continues to be strong. sky i think was basically in line -- >> sky was flat on revenue costs went up marginally. >> consistent with the prior year exactly. flat it is a -- you would have to think for this year end, this

quarter, kind of a consolidation year where the company shows how stable it is, but the growth is not what it has been in some previous years, obviously, and there's investments that are being made we'll see how it finally plays out. but i think the -- you would have to say that the execution during that -- during that period was solid because you can see it beat the numbers that we're looking for. there's a lot of other -- there's free cash flow, a lot of different ebitda, consolidated, adjusted ebitda increased 5%, free cash flow was lower than last year, and higher working capital reflecting post-covid increased investment in content creation so all said and done -- >> it sounds positive.

>> up a third of a percent let's get to dom chu would you like to take the baton from me and talk about the parent company, dom? i would avoid that completely if i had a choice >> here's what i would say, i think it's fairly -- i mean, we would disclose it, right, just like you did, because it's the responsible thing to do, but it seems obvious that when we talk about this company, this is our parent company, it owns our network and cuts our checks, you look at our reports and say, okay, they maybe have an ax to grind and you kind of move on. i have no problem talking about comcast because i think it's known. it's not to say i wouldn't be critical of our parent company there were bad metrics -- >> you got to do what you got to do and hope you don't see a text or your phone ringing. that would never happen. i should point out, that would never happen -- when i see --

>> it actually never happens. >> that would never happen even for anything else, it's never happened when people say that we are given things to -- viewpoints -- >> we dig our own -- >> when we do stupid things, we own it. >> i will confirm what you guys are saying >> that we're idiots. >> i've never once gotten any kind of a communication influencing whatever i've been saying with regard to some of those types of things. anyway, so, yes, comcast, our parent company, those results are out. they're up 2% right now and, yes, and by the way, and i've said it a number of times on twitter, a number of times on our air, i joke about comcast being the only stock i really care about that i talk about it's the only stock that i'm allowed to own and many of our employees are the same way with the shares up 3% right now, let's move on to some of the other bigger earnings moving we got a report from mccormick which is down 1.5%

this is the cooking spices, that sort of thing, profits and revenues are both consensus forecast it was a mixed forecast for the full year, though. the revenue forecast comes in better than estimates, but the full-year profit expectations did miss the mark. mccormick said it was hurt by higher cost inflation, supply chain challenges, as well as disruption to its china-related business but down 1.5%. there are a lot of eyes on tesla stock this morning it's up roughly, call it 7% premarket. over 2 million shares of volume so far the carmaker after the bell yesterday beat projections for profits and revenues profit margins at tesla came in the lowest levels over the past five quarters. and tesla market value, if you look from the january lows, this little move higher that be roughly 39%. it's added roughly $115 billion to the market cap of tesla now.e watching the shares as

around 25,000 shares of volume it announces a new $75 billion stock buyback program and a boost to its quarterly dividend payment. just for context, 39% gain over the last year, not unheard of for oil and gas companies, but a $75 billion stock buy back means it will give back shareholders throughout the course of this program enough money to effectively buy drugmaker moderna, joe that's how much money $75 billion is it's right now currently bigger than the market cap of moderna i'll send things back over to you. >> it's like 22% -- almost 22% of the market cap of the company, dom sometimes we do it in number of shares, other times we do it in dollar amounts it seems like it sounds a little bit bigger because it's an expensive -- i would sound like,

i think, less if we did it in share buy back. >> i have no context about shares outstanding i can tell you what the market cap is right now, but in relation to that -- >> just quickly, take another look at comcast. if it was any other -- if it was disney -- if it was any other company that had as many irons in the fire, we would probably look at it but it's now up 3% it's bouncing around. >> it's jumpy. >> but, i don't know, i think at this point, in an earnings season like this, if you beat expectations and manage through it, that's -- you don't have to have, i think, necessarily a bel blowout number there are things in there, obviously, that will probably -- broadband growth has slowed. >> a lot of this was -- we're -- we'll have a --

>> both of them have been -- to lower over the past -- look at the economy we're in right now. >> brian roberts has a conference call coming up. the first reading of fourth quarter gdp will be the data point that investors are going to be watching this morning. steve liesman joins us with a preview of that. steve, what should we be expecting? >> we should expect a strong quarter of growth that's going to cap, becky, a really strange here that looked like, but most thought, wasn't a recession early on, gave way to stronger growth forecasters see the economy stalling this quarter, this year and perhaps delivering the recession that they thought might have happened last year. gdp expected to rise by 2.8% trust me, there are a boatload of forecasts that are in the threes and even in the high threes the gdp deflated price index rising a tamer 3%.

jobless claims, expected to remain at 205,000. durable goods of 2.4%. it's a surprising end to the year that began with two negative quarters. remember, typical benchmark for a recession. but it was driven lower by massive pandemic-related swings in trade and inventories the consumer and businesses held in there for those two quarters and seemed to accelerate in the second half. most forecasters see that ending with this quarter as robust spending at the beginning of the quarter looked to give way to weakness by december jp morgan saying it looks like the economy lost momentum late in the fourth quarter. here's the update we brought you earlier this year which sees growth slowing to a crawl and gyrating around the zero line for the rest of the year the two main questions are first whether the consumer weakness from november, december

continues into this year we'll get numbers tomorrow and how it will cut into growth. folks, i would siay enjoy this number, because it's not supposed to be this good again for awhile. >> we will relish it thank you. we'll see you in just a little bit. we have other news blackstone's earnings just crossing the tape. the company reporting fourth quarter eps of $1.08 it tops estimates. revenue coming in at $2.34 billion. that missed estimates of $2.74 billion. we're going to speak to the company's president and coo jon gray coming up. more on the tesla results and barry sternlicht is going to join us in less than a half an hour take a look at the markets right now. things still moving around dow off 14 points.

nasdaq up 81 points now. the s&p 500 higher as well close to t pnthierenois gh we're coming right back. >> announcer: stocks to watch is sponsored by voya. well planned, well invested. like your workplace benefits and retirement savings. with voya, considering all your financial choices together... can help you make smarter decisions. for a more confident financial future. hey, a tandem bicycle. can't do that by yourself. (voya mnemonic.) voya. well planned. well invested. well protected.

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that compares to estimates of $1.14. revenue came in at 13.19 bronze medals quarterly passenger load, 83.9%. and the company saying that it continues to execute on its own plan to pay down $15 billion of total debt by the end of 2025. the airline saying that it sees full year adjusted earnings between $2.50 and $3.50. that stock is up by 2% right now. that's a big difference from what we're hearing from southwest airlines this morning. phil will join us in a bit and we'll have a round up of all the airlines. >> you can still drive a 747 -- >> fly. >> fly one or drive them between 250 and 350. >> yeah. >> should we talk about tesla? because it's soaring right now in early trading this after the ev maker beat profit estimates musk joining the call late last night.

recent price cuts have sparked demand here's what he said. >> thus far in january, we've seen the strongest orders year to date than ever in our history. we're currently seeing orders at almost twice the rate of production >> joining us right now, mark fields, former ford ceo, also a cnbc contributor it's great to see you, mark. you've been -- dare i say skeptical, maybe is the polite way to put it over tesla i'm curious what your take is on these earnings >> relatively speaking, they hit record earnings. it was a relatively good quarter, even despite a lot of the issues, supply chain, demand in china, et cetera. i think to me the most impressive thing is, if you think about the trajectory, they're full year profitability was back in 2020 and may made $720 million this year they made over

$12.5 billion and right now that's more than what's projected for ford or gm it's quite impressive what they've been able to achieve between that and building up to 2 million units of capacity at this point >> does this change your view at all about the valuation of this company? >> well, i think this company has been valued much more as a tech and software company than a regular car company. what you're seeing now, they're experiencing what it takes to compete as being one of the big players now in the auto industry which is when you see demand go down, how do you stoke that demand, the impact on your margins, and i think investors are looking at this and saying, should we go forward and continue to value it as a technology company and the growth involved, or should we value it as a traditional car company. but i think tesla -- what musk has said, listen, with these price cuts, we have the

advantage of scale versus the established automakers so even if you want to, you know, look at me more as a regular automotive company, look at my margins versus the competitors. because these price cuts are really going to put a big challenge for the traditional automakers who are launching their evs. >> and that's the question can the other automakers cut prices in the same way i don't think so they can. >> well, you know, they're going to have to respond, andrew, in one form or fashion. the way consumers shop is based on price they're looking at a price range. if you're product doesn't fall within in that, you're not being considered the traditional automakers, their challenge is when -- is to get to scale when you ramp a plant, it's really important to ramp it up fully, get in stabilized, that's when you can really start working on cost efficiencies within the plant and with your

suppliers. that's what tesla has been able to do. and so i think the automakers, they're going to have -- tesla went through production hell to get to scale the established automakers know production at scale. but it's not going to be a cakewalk for them. so they have to get that volume which means they have to be priced competitive. >> mark, can we talk cruise control and self-driving your former company ford coming out of the top of a consumer reports list yesterday that the cruise control which is not necessarily as advanced as what tesla is doing, but came out on top -- tesla fell to number seven because consumer reports didn't like the fact that you have to put your hands on the wheel but they have no cameras looking at people's eyes did you see this they put ford and gm -- or i think a cadillac at the top two slots on this. >> yeah, when you look at the

self-driving capabilities, somebody like ford and even gm, those systems are very easy to use. listen, the automakers, the established automakers have a lot of experience with cruise control, adaptive cruise control, they understand how consumers are using their vehicle, and, listen, they -- safety is top -- paramount for the established automakers and you're seeing that in this report that you mentioned that came out that the use ability of it is good. >> should we say it's limited? i saw people suggesting that ford is, actually, in league if you will with where tesla is or where general motors is on self-driving and i sort of thought to myself, i don't know if that's right either, actually, i think that tesla is quite ahead relative to the other players. >> yeah, well i think what this survey is talking about, the

prevalence of the systems that people are buying. and right now, you know, most consumers are buying these cruise control systems, and not experiencing full service driving like you have in the tesla. it's basically a report that, you know, being able to survey customers that are using products that are in the marketplace in prevalence. >> how far back do you think ford is on the self-driving. where do you put tesla relative to gm? >> well, a lot of it comes down to how many miles are you accumulating with experience on the road i think tesla is clearly in the lead given the number of vehicles that produced over the last number of years, the data that they're accumulating and using that to improve their systems. i think gm and ford, they're putting more and more vehicles out there on the road. they're behind, but i think they're going to catch up quickly as they get more and more vehicles on the road.

>> okay. mark, always good to see you appreciate it. thank you, sir. >> all right see you. when we come back, a number of airlines reporting results and updating their guidance. phil lebeau has it all for us. he's going to break down the sector and this morning's announcements right after this break. start with capital's barry sternlicht never one to hold back when talking about the fed, inflation, the markets he will be our special guest that starts in a few minutes "squawk box" will be right back. >> announcer: time now for today's aflac trivia question. the practice of short-selling a tradeable asset of any kind without first borrowing the set from someone else is known as from someone else is known as whato you... got there? the answer when cnbc "squawk box" continues for $1,200? ga-a-a-ap! did you say "gap"? yeah, he did. he's talking about expenses that health insurance doesn't cover.

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>> just had a trivia question on naked short-selling. rub it all over yourselves, people a big day for airlines phil lebeau joins us what's going on, phil? lots of airline news today. >> you got four airlines that reported q-4 results this morning and some of the stocks moving substantially let's go down the list the first with american airlines remember, two weeks ago, we were with robert isom the numbers you're getting are roughly inline with expectations earning $1.17 a share in line with the new guidance. it beat the estimate by 3 cents. then there's jetblue for the fourth quarter, the company did beat on the bottom line earning 22 cents a share versus the street at 20 cents with revenue coming in slightly better than expected when you look at jetblue, their guidance, much weaker than the street was expecting that's one reason why there's a little bit of pressure there then you have southwest.

we talked about this within the last half-hour this is a miss far worse than what people were expecting. in the fourth quarter it lost 38 cents a share. the street was expecting a loss of 28 cents a share. it's the lingering impact, that's putting further pressure on this stock. the lingering impact for the meltdown on december, they're expecting a negative impact of 300 to $500 million, people booking away, deceleration on bookings that is going to be something we're going to talk to bob jordan about later on this morning and then you have alaska it reported a miss of 92 cents a share profit the street was expecting 94 cents a share with revenue coming in just a little shy of expectations i mentioned bob jordan talking with him, the ceo of southwest airlines you do not want to miss these interviews we've got a great lineup of airline ceos coming to you today. our conversation with bob jordan, not just about what happened in december, but now you've got this question about the lingering impact, we also will be talking during tech

check with robin hayes, the ceo of jetblue, and then later on, ceo of alaska airlines lots to discuss with these ceos. specifically with mr. jordan we're going to get some sense of how long it's going to take to fix what went wrong and to reassure their customers, guys, they had perhaps the best customer loyalty over the last ten years, 15 years, a lot of that is out the window now and you can see that impact in the first quarter. we're going to discuss that with bob jordan. >> yeah. how quickly that can happen, phil, after years of -- you know, of goodwill from the advertising and the symbol and -- not the -- not instituting the fees they did -- anyway, cheap fares but great service. now it can be gone in an instant. that's a pretty good lesson for corporations, phil thanks >> you bet still to come this morning,

starwood capital barry sternlicht will be our guest what he's seaeing in the housin rk rht nmaetigow stay tuned you're watching "squawk box" and this is cnbc

all right. welcome back, everybody. i want to get right to our next guest on set barry sternlicht is here with us this morning last few times we've seen you, you have pounded the table about how the fed was really making a mistake by continuing to raise rates and raise rates so rapidly without waiting to pause and look around. what do you think with what you've seen so far because the economy looks okay at this point? >> i'm still -- i still agree with what i used to say. i think there's 150 economists that advise jerome powell and these are the same people who said inflation would be transient. the dots were supposed to be 0.66 a year ago and they were 4 1/2. so i think they're making the -- they actually showed up to the party so late, they let

speculation go wild with zero rates. they're buying corporate bonds way into what was a recovery today, you know, as they continue to push on rates, they seem hell bent on changing the labor market, to lower wages and i think that's awful i think what the benefit of a tight labor market is wage growth, we wanted the middle class and lower income people to do well and push them into unemployment i've been focusing on how are they going to succeed? the jobs that are open, there's 10 1/2 million jobs in november. that's normally 4 1/2 to 5 5 million job openings have to go by the way, and they have to reduce unemployment by a point or 2 and that's another 3 million jobs with interest rates you're going to fine-tune the economy so you can figure out how to lose $8 billion i look add 2007, 2008, 2009. we lot 104 manufacturing jobs. and we're going to lose some

manufacturing jobs because rates have gone up and things like cars and everything are less -- diswashers but a million construction jobs are lost that was a number two category you're going to see that this time, but you haven't seen it yet. i'm building -- all real estate people and all corporations are finishing their plants we didn't stop construction because he increased interest rates -- >> you're just not doing knew ones . >> as these projects finish you will see massive layoffs in the commercial construction markets and companies delay the investment in plants, chevron could be drilling wells, they're going to buyback stock he will get that but he should be focusing on increasing the supply of labor because in conversations -- >> that's not something the fed -- >> yes, the fed can help there well, politicians can help first, fix immigration we're 200,000 immigrants moved

to 1.1 both sides of the aisle. they've got to fix immigration immediately. we've got to get these worker visas fixed. let a million people back. 2 million people left the workforce during the pandemic. it's mostly the 55 to 65 come up with some incentive to get them back to the labor force. we need those 2 million people and i think also we've talked about -- other guests have talked about welfare the packages of welfare incentives that were offered by states, they need to be looked at there are people who are collecting welfare and working part time jobs and hiding their income and so we don't want to make incentives to stay on welfare. the end of this, the end game,

he succeeds and the -- we just increased the national minimum wage walmart yesterday went from $12 to $14 i love that. that's fantastic that is a healthy economy, people feel like the economy is working for them if he succeeds and we knock 8 million people out of the workforce and they lose their jobs, now the government is paying for them. they're on welfare again unemployment benefits. and they're going to vote for bernie sanders they're going to say capitalism sucks. i just got this great job, i'm getting $22 cleaning this hotel room, i used to get 14, and the government -- i didn't cause this problem and they're throwing me out of my job. usually, it's interesting, travel is one of the first things that gets hit in a recession. and i was just playing golf with the ceo of one of the hotel companies and i look at my own hotel book, numbers are okay they're shockingly strong. >> you have the pent-up demand. >> i think companies are doing these outings because they're not in the office and the only

time they can get together is an outing they get everyone together in hawaii or disney world or miami, but i do think that will roll over too that's the third area or the fourth area where unemployment could -- what could impact rates, manufacturing, construction, it's coming, offset -- if they get their act together to spend the stimulus package, those are construction jobs maybe go from building housing -- >> do you think a recession comes this year? >> yes, you're going to have a recession third and fourth quarter. look, the consumer sort of -- the savings rates are at all-time lows. >> that would explain the ten year. >> his credit cards, inventory -- it's interesting, one thing about inflation, we talked about the supply chain, it's not totally fixed if you're building a building and you can't get the generator, you have everything else, it's no good. you got to get all the supplies. i look at what we're doing, we're opening a hotel in hawaii in two weeks and we can't get

this and that, we'll open part of -- it's all because the supply chain is broken still in places it is getting fixed, but it takes time inflation will subside even further as the supply chain -- >> the market doesn't believe the fed. it's had plenty of chances to say, okay, i've learned. the ten year already knows they're going to end up knows they're going to end up cutting beneficiary. >> and goldman has the short rates at the end of the year the fed is doing a job of sort of trying to scary everyone. inflation will go negative, negative may or june because the biggest number in inflation is the housing equivalent number. they're pointing positive -- >> negative in june. >> negative. >> that's the month. >> negative. >> we're not 4% -- >> i'm about 75% certain barring an oil spike or some crazy thing. end of the year, what does it look like? >> i like inflation to be 2, 3%. >> there's a lot of people who

say it can get to three and it will be stubborn -- >> if he does his -- the risk is, he keeps going and then he's in a serious problem. there's another fascinating situation at the federal government the white house just put out their $1.7 trillion budget bill. and i hear the music >> we want to continue this conversation a nice tease for the next part of this. >> we're good. >> barry is going to be with us for another hour >> don't go anywhere. does the ftc's proposed ban on noncompete clauses harm competition. we're going to find out when jon fortt joins us and then jon gray is going to be here to discuss the firm's prateqtyta ots and the stef ive ui and so much more. playin] ♪ 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. thanks to avalara we can calculate sales tax on almost anything, anywhere, automatically. avalarahhhhh. what if tax rates change? ahhhhhh. filing sales tax returns? ahhhhhh.

managing exemption certificates? ahhhhhh. business license guidance? ahhhhhh. does it connect with accounting? ahhhhhh. item classification? ahhhhhh. cross-border sales? ahhhhhh. what about? ahhhhhh. ahhhhhh. do you have those budget markups? thank you. mmhm. [bubbles]

earlier this month, the federal trade commission issuing a proposal that would ban the use of noncomplete agreements in employment contracts would it usher in more innovation or more theft jon fortt here to weigh in what do you think? >> well, andrew, killing noncompetes a bad idea it would tilt the balance of power toward labor wage inflation is pressuring business what is a noncompete disagreement workers agree to a waiting

agreement before check leave one employer and work for a same rival. it can serve an important role we can understand why companies have to carefully protect their property and while it might seem like a good idea to rely on the trade secrets act to just restrict workers from sharing information when they switch to a competitor, those violations are hard to approve and enforce. for some roles and industries, it just makes sense for there to be some friction that makes the job a bit stickier people want to work from home and be flexible. which means, switching employers could be as easy as switching email addresses. you don't have to clear your desk. >> is this about protecting secrets more, do you think, or is this more about people who don't want even more competitive labor market >> well, on the other hand, andrew, noncompetes are a crunch unnecessary. california noncompetes are unenforcement in california

you would think silicon valley companies would be hemorrhaging secrets, yet apple can create computers and employees don't get pouched by rivals and leak the blueprints at their worst, these noncompetes prevent price discovery in salaries and stifle innovation my employer doesn't have to worry about me jumping ship, if i can start my own company, that's a drag on a potential economic engine. making things worse, noncompetes aren't just for high paid jobs anymore. youth soccer coaches are being asked to sign them too according to a report released a year and a half ago, 8% of the lowest wage hourly workers are being asked to sign noncompetes and that shouldn't happen in a properly functioning labor market, andrew >> should the ftc get to decide this on its own? do you think somebody else should let me throw another one at you,

should there be a cutoff in terms of pay i don't know if they're trying to protect people who are making millions of dollars. or whether they should be. >> what this study from the minneapolis fed also found is that people on the higher end are actually getting wage benefit from noncompetes because they know, if i got to sign this, it's going to create friction for me. you got to pay me more and i have a cushion if i leave and want to go somewhere else. a big part of the problem is happening at the lower end the question of whether the ftc should be doing this, we already know that they're going to get sued if they try to really pursue this. ideally, ideally, legislation handles this sort of thing but, you know, congress getting things done -- >> sternlicht, what do you think? >> the only people who you sign noncompetes are people who might steal your investors -- >> what do you think about the

hospitals, they're doing to the nurses or these barbershops or hair salons -- >> we know gyms in new york that sign noncompetes with their trainers that's terrible. >> terrible. >> i think we figured out which side of the hand you're on this time. >> i'll put you on a noncompete and i'll tell you. when we come back, congress looks like they begin work on working on crypto. we'll hear from congressman french hill. that's next. right now, though, as we head to a break, let's take a look at some of the names reporting this morning and the market reaction to the numbers american airlines, the only one of the company reporting that's up it's up by 2%..3 "squawk box" will be right back. but the things that last a lifetime like happiness, love and confidence... you can't buy those. but you can invest in them. at t. rowe price,

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financial services committee chairman patrick mchenry has made it clear crypto regulation is a key part of his agenda in this congress. to help usher his plan along, he formed a new subcommittee dedicated to setting new rules for the crypto community joining us, congressman french hill he'll chair the newly formed financial technology and inclusion subcommittee and we have heard that things like, in finance, we don't know about blue states, red states.

we just know green why on earth is crypto people going to both corners depending on which side of the aisle they're on, congressman? what does that come from why do you need convincing of one side or the other? if you want to do this, the democrats aren't going to want to do it, i know it. i can see it coming. >> good morning. good to be with you. i think there's an opportunity for bipartisan work here on creating a regulatory framework around digtt assets. think for two reasons. one, you're right, there are some democrats who think anything associated with blockchain or crypto currency is just money laundering, a way to have bad behavior. on the other hand, there's some republicans who think the future is decentralized finance and digital assets are critical. i think we bring thel together because blockchain is an important innovation area. we want that technology to be done here in the united states we want a regulatory framework

that's transparent for developers and investors and potential consumers as people try to prove a use case, and finally, we want to make sure that people have a full transparency of that i think that will bring democrats and republicans together for both law enforcement reasons if that's what their top issue is, or for financial and innovation reasons. >> do you think we need to follow the fumoney? whether they have big offices on k street and don't want this to happen i won't mention any names but there's a lot of industries that probably are loathe to think of a future with decentralized finance. >> that's true but look, blockchain right now is an emerging technology. there are industries all over our country that are looking at how can blockchain or a distributed ledger be useful in their business to cut down on

a agency costs those don't always have to be completely disruptive. they might be more gradual as the innovation takes place right now, for example, i loved the comment where somebody said a transaction using bitcoin takes so long, my coffee is cold so this is not right now a technology that's ready for primetime in a real time payments industry, but we want to make sure america is the place for innovation in fintech and blockchain and distributed ledger technology is part of that fintech future. >> well, it has real consequences to not have a framework in place and you know, i'm not saying that sam bankman-fried didn't brink it on himself, but we certainly enabled some of that to be offshore i mean, it's going to help it's going to help the industry and help the technology if congress could get its act together do you think should be a spot bitcoin fund that's not going anywhere now

either >> yeah, so that's what we want to explore with this digital assets committee you'll see us look at a privacy law, a federal privacy law i think you'll see us consider a stable coin bill that we made progress on in the last congress with work from our leader patrick mchenry on the committee and then chair maxine waters what are the ramifications for the securities market and work with the agriculture and house and senate on the commodity aspect of it, trading the coins and running -- how should the exchanges be overseen. all that is on the table and all is going to be a priority for this year. >> you think it's going to be this year? you think it can be bipartisan when it's said and done? that would take -- i don't know, we're not there now. >> hey, i specialize in bipartisan this is an area that's important for our country. we need this regulatory framework and we need to come together to have it or we're going to have continued chaos

that we saw last year with the spring of bankruptcies across the industry that's not helpful to developers, to the industry, to innovation, and certainly not to investors and consumers. >> you can't really tell the s.e.c. what to do, can you that's going to be -- as long as gary gensler is there, do you see progress being made? >> well, chair gensler said he was the cop on the beat last year he also says he's an expert in this area because he taught it in graduate school, blockchain distributed ledger technology. we'll invite him up to congress to tell us what he knows and what he was doing last year when we had so many challenges for our investors and our consumers. >> just overall, what does the speaker mccarthy-led house expect to accomplish in the next few years? i love all these bills you guys are involved with that have no chance of ever becoming law.

and you guys take it seriously and kill all the trees, all this paper comes out. there's all these things that are done and people at home are like, why are they doing these things it is nice to make a statement, but it would be nice to have something that has a chance of becoming actual legislation. is there anything on the table right now? >> well, joe, i think we want to keep our commitment to america, and some of that you're right are posturing bills that talk about what we would do if we had the house, the senate, and the presidency, and through the 2024 elections, that's aspirational, but we also want to get things done and we're going to work with our friends in the senate to send legislation to joe biden that we're trying to find consensus on how do we reach consensus on the immigration laws, securing the border it's a top of mind issue for everybody. we have an agriculture opportunity to do a bill this year, and most importantly,

we'll try to find consensus around spending for 2024 and try to go back to a pre-pandemic approach that where both sides, democrats and republicans, thought large deficits were bad. we lost that we need to get back to it. and move toward a more conservative approach to budgeting. >> should closing down the government be a potential tool there are some in the house that are in that camp you don't think that's viable? >> i don't think that's always viable, but over the past 40 years, when you see a debt ceiling increase about 4 out of 10 times it's produced a spending control plan and a better approach to spending. so we do want to use that and talk to joe biden about what we can do together to go back to that pre-pandemic spending >> all right congressman, thanks. thanks for -- sarah huckabee sanders, is she the governor now? is that for real >> she's our governor.

she was sworn in two weeks ago she's larhard at it >> she's excelled. thank you. good to have you on. >> see you, joe. >> i don't see that from the other former press secretaries, do you >> no. >> when we come back, blackstone president and c.o.o. jon gray joins us to break down the company's quarter, plus a slew of economic data at 8:30, including jobless claims, durable goods, and gdp p e dow up 60. s&up by 20 "squawk box" will be right back. , 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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terrier-iffic i labra-dore you round of a-paws at&t 5g is fast, reliable and secure for your business. good morning another big day for earnings new results from our parent company, comcast, as well as airlines and private equity giant blackstone we'll speak with that firm's president this morning >> plus, getting set for brand-new economic data. our first look at fourth quarter gdp, plus jobless claims and more tesla shares are charged up after the company reported all-time highs in revenue and profit deliveries remain a question mark the final hour of "squawk box" begins right now

>> good morning. welcome to "squawk box" here on cnbc, live from the nasdaq market site in times square. i'm joe kernen along with becky quick and andrew ross sorkin, spending quality time behind the scenes, too, with us today >> yes >> ceo barry sternlic, there's a market perhaps for a behind the scenes -- it would have to be on a network that allows a lot. wouldn't it? in terms of language, yeah >> that's the white lotus. >> we were just talking about that >> we were >> i'm still on the first season there's things i can't unsee right from the very beginning, it's like, is that oh, my god, it is. u.s. equity futures at this hour are -- you remember that >> of course >> up about 83 points.

nasdaq up 123. and s&p up 43. okay, let's talk private equity because private equity giant blackstone out with their fourth quarter report the company posting mixed shares beating estimates, but revenue missed we'll have blackstone's c.o.o. and president on in just a little bit blackstone shares down more than 40% last year. more than double the s&p 500's losses, but the stock has vastly outperformed the s&p this year joining us right now to talk about it, blackstone president, jon gray good to see you. we have been trying to make sense of both this dual story in terms of the stock and the company's performance at the same time. what do you think? >> andrew, great to be here. happy lunar new year to everybody. for us, the fourth quarter was obviously a bit challenging given the market backdrop. but the key really is last year, we delivered for shareholders. we had earnings grow 8%.

we grew our aum 11%. we had $225 billion of inflows during the year, and we delivered to dividends and share buybacks more than $5 to shareholders but the key really is in our business, is performance and across the board, in real estate, in private equity, in credit, in hedge funds, we delivered positive performance basically in protected capital in a year you know where the s&p was down 18% and the key really is where you deploy capital so for us, huge exposure in travel and travel related businesses, in logistics, in our hedge fund area, in quant and macro investors, in energy and energy transition. for us, what really matters is

do we deliver for the customers? when we do that, they deliver more capital to us and ultimately, our shares will respond to that. that's why we have so much confidence about the future. >> you started your career as a real estate man. we have another real estate man at the table, so i'm curious how you see it both in terms of the blackstone portfolio itself and even some of the larger trends right now. >> i think on real estate, and barry obviously knows a lot about this business. i think what you have to do is not paint everything with the same brush there's clearly a headwind from higher interest rates, which has led to higher cap rates or lower multiples. that affects all real estate out there. and we have been adjusting that in our portfolio with higher cap rates. but then when you look within asset classes, it's really dramatic the differences if you look in the u.s. office market, they can see including subleasing is today now north of

20%. and rents are going down, and that's a very challenged sector. for us, fortunately, u.s. traditional office is less than 2% of what we own. on the flip side, if you look at logistics, there globally, you have vacancy running 1% to 3% in most of the major markets. rent is still growing 10%, 20%, and leases in place that are way below market and our fourth quarter, we saw 65% re-leasing spreads where you deploy capital matters. for us, logistics is 40% of our global portfolio also as you look forward, new supply is starting to come down because of the higher cost to capital, that's a tailwind for real estate, and the ten-year treasury is backed up now down to below 3.5%. it's a mixed picture, but we think if you invest in the right neighborhood, you can have a verypositive outcome >> jon, it's barry

good morning how are you? >> good. how are you? >> i'm excellent, thanks i hope you had a great break congratulations on your earnings always impressive. i think we see the same things we're in the same business and this product, we're number one and two in the nation. it's an interesting time i would be curious about your deployment of capital, new investments. because i think it's an uncertain time my personal feelings are that at the fed signals they're sort of done, the fed did three things at once which people don't understand the most obvious is the increased interest rates and they did it so fast that it was kind of a shock therapy to the real estate markets, all fixed income and long duration assets. then they have been selling off the balance sheet which also puts pressure on liquidity and they have had the regulators come in and tackle the banks and say don't lend and be super careful, and they started with the money centers but have now

gone to the regionals and superregionals talk about liquidity in the banking market, how you think it's impacting real estate, and long term, it's good because new supply will disappear. >> that may be good good long term >> if he overdoes it, he'll throw us into a fairly significant recession. we talked about construction jobs opening up as property is complete you'll see the impact of sequential bankruptcies in the office markets, nobody can refinance an office building because the banks won't lend >> is that opportunity for you or is that pain for you? >> it's an opportunity for non-bank lenders like jon and i have what do you think, jon where are you seeing opportunities? >> in terms of real estate, you made a good point, barry, which is there's less capital availability, less debt availability there's a little more in the multifamily space because the agencies lend in that area so there's still pretty good

liquidity, but the banks have pulled back. the cnbs market is much slower spreads have widened that creates a great opportunity for our real estate debt business, and what it allows you to do if you have capital is take advantage of that buy assets we bought more than a billion dollars of logistics in canada, in sweden, in the uk similar dynamic in those markets as banks have pulled back. when people need liquidity, you can step in. it takes a while for these transactions to happen, as you know but we thing it will create opportunities. i do think over time once the fed slows and pauses here, i think spreads will start to revert again because fixed income investors will find the absolute spreads attractive. i think we're in this transition period i do think there will be opportunities. what i'm a little cautious about is in some of the toughest sectors like traditional office, the underlying fundamentals are tough. for-sale housing is going to be

a bit challenged as well in the sectors we like, like logistics. rental housing, hotels, those would be areas if this lack of liquidity creates opportunity, we would love to seize that. >> jon, are you in the category of recession come the end of this year? we were talking to steve schwartzman, a man you know very, very well, last week in davos. i think he seemed to suggest we may not be at the worst of it yet. i don't know if you think tabou it as opportunity or what? >> first off, steve is the best. but what we say in terms of the economy is we have seen remarkable resilience. our private equity portfolio in the fourth quarter had 14% revenue growth again, some of that is where we deployed capital, but there's underlying strength. corporate credit market has held up well, no question about that. but as the fed raises rates, even as it pauses, it has this

impact on the economy, and it takes time for that medicine to work back to barry's comments on construction, you know, if somebody started a project 18 months ago, when it completes in six months, the workers on that project may not have a new job so i do think we will see a sequential slowdown, but i think everybody has been surprised it hasn't been as steep as it was expected and i would also say we don't have the kind of imbalances we had back in '08, '09 in housing, commercial real estate, the banking system so yes, we're definitely anticipating a slowdown, but it's been gradual. it will take time. and it's something companies have to prepare for. it's what we're talking to our businesses about >> jon gray, always good to see you. thank you. >> thank you all right, right after this, we have much more with starwood capital's barry sternlic and we're counting down to all

that economic data that hits at 8:30 a.m. eastern time stay tuned, you're watching "squawk x"ndhiisnbbo a ts cc. ,d

ceo of starwood capital. you want to think really big picture? you're going to live a long time, i think. we're at $31 trillion, 120% debt to gdp you're a real estate guy you know what happens if you get overleveraged. we have unfunded liabilities -- a lot of those as well long term, are you bullish on the prospects? what would we need to do to avert disaster >> let me go back and then we'll go forward first, why am i confident inflation has peaked the biggest increase in the last month and has remained is the renter equivalent number in the data which is .8 positive. in reality, that was .34 negative the lag in the housing data is completely distorting inflation. since rents are falling, market rents are falling month to month, they're going this way, you will see a negative number there. it will look like energy, it

will come all the way down inflation will come down people who talk about keep raising rates. i hear these guys on the morning show, i want to strangle them. volker didn't have a $32 trillion deficit the federal government spend the following amount of money the last four years on interest expend 2019, $375 billion, then $352 billion. there were the average interest rates those years. .5 in 2020, .1 in 2021. that's the average, in '22, 1.9% this year, they'll be 4.5, 5%. >> we'll be up to a trillion dollars. >> a trillion plus on interest that's, so the budget the white house put out has a $400 billion number that they didn't update for today's interest rates this is their november number out of the white house, which is where they put the $1.4 trillion

fiscal spending. if he keeps going up, you have to keep printing dollars to pay interest on the deficit. you wind up printing and printing and putting tremendous pressure on all ends of the curve. that will really slow the economy, if the ten-year goes to 5% because this thing gets out of control, and who is going to buy our paper? we have pissed off the chinese they're not going to be buying our paper and most countries are ulpulling back to their borders. he risks this if he keeps going, these academics in washington. he risks the entire financial stability of the system. you have the imf and the world bank telling you to stop raising rates. what we do in our holes in washington with our federal reserve banks impacts the entire globe's economy. and it's not like it's strong in europe they can't afford higher rates they're worse off than we are. >> maybe this is what we need. >> it's coming your way. >> if rates go back down, we'll say everything is fine >> if he pulls this off, which

he has a good shot of doing, of having a soft landing if he stops. a mild recession is fine it will be fine. you don't destroy all these manufacturing jobs we bring back, we onshore, we get -- we fix supply chains. he will be good, i would be bullish. if he keeps it up, and the political gridlock, don't focus on things that matter in washington - >> if rates are higher, maybe we stop if we go back to where you want to go, okay, it's not a trillion, we're back down to $300 billion if we're spending a trillion every year >> 2.5% lower. >> how can we spend on other things if our debt services is so high? if it goes to $35 trillion - >> we need a plan to reduce the deficit. health care initiatives are going to change the death rates or incidents of many diseases. so social security, employment

benefits, that's probably overstated we'll have such incredible medical breakthroughs over the long term. >> let me ask because you built up 115,000 apartments over the last seven years or so do you see rents in your own place coming down? you had significant rent hikes last year. >> we all did, the whole nation did and every market of course, i think rents were up 20% across the united states it was a pandemic, i don't know what happened. none of us modeled it. it just went bananas it's actually released some pretty nefarious forces now. you have people wanting rent control. it's very politically popular. i fast forward to mumbai, go to india where you have spectacular buildings that are completely decays because they put in rent controls and nobody takes care of the buildings so they rot they mean well, but every time you put in rent control, you end up with a bad housing cycle. we have a 5 million housing

shortage nobody is going to build affordable housing and that's the other thing, he wants inflation to go down, but he's killing the construction of single-family homes and increasing the lack of supply. so we need a balance i'm not saying we want zero interest rates we want a positive yield curve that doesn't dissuade long term investments. so companies, i'm buying the two-year i own it, i never owned any of it that's not a bad place to hang out while the world sorts itself out and they figure out if they're going to go over the edge or be reasonable. look, this is the fastest increase in rates in history m2, our money supply, has never been negative in 70 years. this is a tight, tight financial market liquidity is tight the banks are wonderful. i wasn't picking on the banks, but they have the occ all over them saying stop lending, stop lending. don't grow your balance sheets it's not the banks it's the regulators, everyone means well, i assume

>> your pie chart, how much in the two-year for you >> said you never touched it before in your life. >> i moved cash and moved it into six-month, one-year, and two-years. i'll come out when the dust clears >> we talk about a recession coming at the end of this year >> if you're in business, there's two things you're looking at, a base rate which the fed controls and the spread we borrow at the spread is a double-2 the first thing that will happen, aaas, they used to cost you a point, less than a point over base rates. they're double as soon as people feel like the fed is done, i think spreads will come in that will help you're getting paid too much for aaas today and then, he will have to lower base rates because the economy is going to show its -- it's going to slow. when you're looking in the rear view mirror, i don't think it's sustainable. actually, in '08-'09 financial

crisis, professional services lost 700,000 jobs. if you look today, that number is around 400,000 already. he's getting those layoffs at google and alphabet, the same company, amazon. what actually went up in '08 and '09 were education and health care interest rates are not going to impact that side of the labor market they're going to impact construction, manufacturing, so he's got to get, if he wants to eliminate the 5 million excess jobs and two or three points, he has to go hard at these industries and knock you on your butt >> where i was getting, i realize i'm leading to the delivering alpha prognosis for the next ten years we're going to have so much debt service it's going to be hard to have enough money to invest in the things we need to invest in to get to gdp that much debt service takes up so much of our expenditures. >> staggering. >> are financial assets going to

be a tough place to live for the next ten years >> i think the world will give the u.s. as the reserve currency, if we had a plan that paid attention to deficit reduction, if we had any intention of trying to tackle -- the government has a $1.3 trillion deficit for 2023. it's going to be closer to $2 trillion business incomes are down, and this is a rich-cession, a recession of the rich. they have crushed tech, venture, private equity, real estate. so you're going to see, and you're going to see the interest expensenumber much higher. it's going to be around $2 trillion >> the way of the world's reserve currency >> to bring down the deficit, we would have cred sibility and be okay we can fix this. there's so much waste and excess

spending in government there's no effort. >> i saw the latest pandemic fraud. did you see that >> it's a lot of money we throw away $100 billion a minute and don't care. it doesn't mean anything and we are not that rich you know, we used to be rich >> now we're getting the fourth quarter number coming up our first look at fourth quarter gdp. stay tuned, you're watching "squawk box" on cnbc

still to come, we have breaking economic data our panel is standing by for instant reaction stay tuned you're watching "squawk box" on cnbc and we'll be back in less than three minutes ♪ ♪ a cyber-attack can grind everything to a halt. cisco security keeps your company moving forward. because if it's connected, it's protected. cisco.

here we go get ready. we're going to get our first look at fourth quarter gdp in a few seconds. we want to introduce our panel

wendy edal brg from the brookings institution is with us, also the american enterprise institute's michael strain, nancy davis is here, along with pimco's tiffany wilding. our own steve liesman and rick santelli here, and barry sternlicht is with us to see these numbers and react. dow futures up by about 63 it's time for the fourth quarter number rick, take it away >> let's start out with what's going on with initial jobless claims for the weekend ending january 23rd 186,000. 186,000. that is a new cycle low. that's going to take us back to april. april of last year, '22. if we look at continuing claims, 1.675 million, 1.675 million gdp, 2.9%. 2.9% obviously, that's a good quarter. maybe the last positive quarter that we get with respect to

growth of the economy. and as we start to look at some of the other numbers populating here, i see that durable goods is coming in durable goods coming in up 5.6%. that's a very strong number. now i'm getting the rest of the data with regard to gdp on pricing. the price index is 2.1%. 2.1% that is a very good number if you're looking for inflation to come down, that comes down from the 2.3% level the last time we were at a 2.1% level, you have to get back to the second quarter of 2020 when it was mining 1.3, and if we look at what the quarter over quarter personal consumption expenditure core is, it is under 4%. many predicted that. it's 3.9%. 3.9% the last time we had a number in that camp was the first quarter of '21 when it was 3.2%.

and if we look at the final numbers on the trade balance, minus $90.3 billion, that's bigger than anticipated. wholesale inventory is up .1%. much smaller retail inventory is up .5% double expectations and getting some revisions last month's went up on jobless claims subtle change to 192 and if we look at the x transportation, durables up 5.6% is extremely strong. as a matter of fact, that is the best number going all the way back to the summer of 2020 and if we look at all the internals there, you can tell it was transportation figured in properly nnltly because once you take transportation out, 5.6% nose dives to minus .1% of 1%. proxy spending is down .2%, a rather bumpy ride, but we had

solid months you look at shipments, also a very depressed number. down .4% both of those numbers were predicted. both of those numbers were built in both of those numbers are preliminaries, and they may change just a quick recap both the pricing issues on the gdp came in less than expected if you look at interest rates, they're moving up. they're moving up. now, not huge. going up about two or three basis points on the ten. the equity prices have dropped a bit. i think what they're concentrating on most is probably initial claims and continuing claims being on the downside i find it hard to believe the market is going to be too upset with regard to the gdp numbers however, the final comment i will make is, when you look at the price index, it is definitely well below last month's 4.4% at 3.5%, but many were expecting an even lower number becky and the gang, back to you.

>> rick, stay with us. we want to bring in more of our panel for some instant reaction on this. and steve, i'll go to you first. that was a lot to digest which of those numbers are the most important >> you know, i like the durables number i think we're living in two worlds we're living in the world of the present, which has pretty strong economic growth right now. which has that strong gdp number declining inflation. i didn't look at the kurt numbers inside the inflation numbers. we're very interested in what happens tomorrow by figuring out what happened in december. and we're living in the future, which is a future of a really lackluster, lame forecast of a stalling economy so you look at this number and you say what happens in the first quarter? according to the forecast, the economy stops on a dime. and it's hard to see in these numbers the economy stopping on a dime, from a federal reserve standpoint, i think they're

going to look at the top line number, which is 2.9 percent and say i need an economy that needs to be running below potential. that potential is maybe 1.8, possibly lower it's an economy that has not created the slack that is ultimately needed that they believe to bring down inflation. then, add to that these jobless claims numbers which frankly won't quit i mean, you keep thinking, you keep hearing these marquee announcements, becky, of all these layoffs and i have yet to see them either in the continuing claims numbers or the weekly claims numbers. >> part of that is because a lot of these people get severance, it may take a while to work into it, but barry, the fed looks at these numbers, looks at this data and there's nothing in the data that's going to tell them to slow down >> i'm curious about the transportation, negative without the transportation, durable goods because is that autos or boeing jet orders what is that >> to me, the auto industry has

been so strong, i don't know if that's a big part of it. is barry right >> autos were down autos were down 0.4. i'm looking here give me one second hold on. i'm looking at the wrong numbers. shipments and new orders the boeing numbers, which were lousy last month, were up. write this down, it's not a mistake. it's such a huge number. 115.5% wait, am i right about that? i can't believe it rick, can you confirm that yeah, i have 115.5 i have autos -- >> i can't confirm it, but i can confirm the fact when you strip out autos you go 5.6% of transportation down. that fits. it seems to make sense, steve. >> it's so big, these airplane orders they're so big

you know, again, the backdrop is the consumer look at the consumer he doesn't have that money there's two numbers in play here, the excess savings you keep hearing about i think that's concentrated on the top 5%, 10% of the country i think the average consumer is struggling again >> bank of america will tell you they still have more money in their accounts, even lower income individuals than they did pre-covid, but i also heard that money could run out around june. >> jpmorgan says it's going to run out. they see the spending patterns we could have a slow, but maybe it's third quarter, fourth quarter. >> do we feel like we have enough input what was the box we had? i didn't notice. >> i think there are ten of us seven plus the three of us >> 11 of us all collectively >> there's ten of us >> i think that -- >> we filled it out finally. >> we can play the brady bunch

music. >> how do you do it with nine? that's 10% more info >> let's get other guests' thoughts on this too wendy, why don't we start with you? your take on what we see here, what the reaction is going to be these numbers are good, the dow has gone round trip. it went down and came back to where we started before the numbers came in. there are some numbers that are significantly off from what had been anticipated >> so what we can't see in this quarterly number is the monthly pattern which we'll learn more about tomorrow we'll probably see that consumer spending slowed over the end of the year and a slowdown in the economy has been in train for a long time with an expected payback from strong consumer spending on goods, the waning effects of fiscal support, the effects of monetary policy. to be clear, the slowdown i expect we'll see, and that we are already seeing in the monthly numbers, the slowdown i expect we'll see in the first quarter is a good thing.

it will show that the economy is starting to rebalance, get on a more sustainable path, and help to ease the pressure on inflation. so a lot of that is masked in this quarterly number which is really about at this point ancient history. >> that's the one thing we can say. all of these are backward looking numbers. and almost the better these numbers are, the most potentially it can pull from the current quarter. >> yeah, i think that's right. look, we know about december we know that holiday sales were very weak in ecember the retail sales number for december showed a decline of 1.1% we know that industrial production was down in december, that industrial production fell by 0.7%. we know there are problems in the housing market why are we seeing the slowdown in december? inflation, higher interest rates. people's inflation adjusted incomes are dropping and then people are facing higher borrowing costs. the quarterly number obviously

looks at what happened over the entire quarter which i think isn't the right thing to focus on in an economy that's dealing with interest rates that are rising this rapidly and with inflation dynamics that are as fast moving as the inflation we're seeing i think the key thing for the fed is what steve said earlier we're still growing above potential. and the fed wants to push the economic growth rate below the economy's potential while keeping it positive. that didn't happen in the fourth quarter of the year, and the expectation that the fed is going to stop around 5% looks more misplaced this morning than it did yesterday >> tiffany, one more economist perspective on this. the number you think is most important, that you take the most away. >> i actually was struck by the consumption number i think you said 2.1%. that was below consensus and that suggests to me that

underlying the surface here, the details of this gdp report, we're actually maybe a little weaker that could suggest final domestic demand which i think is the key number for the fourt quarter, is 1% or even below it looks like inventories may be a surprise on the upside that's not good news for the forward looking growth trajectory and i agree the monetary policy tightening we have gotten to date hasn't fully been reflected in the real economy. and that's kind of yet to come there's a lot of uncertainty over the extent to which we're goat to get weakness or actual contraction next year. if i'm the fed, i don't think this number really changes my perspective. the other thing i would highlight is on the inflation numbers, if you look at the three-month over three-month, we're over 3%. the projection for core pce was 3.5% that could come down inflation news is good >> that's great.

all right. if it doesn't change the fed's perspective, nancy, does it change investors' perspectives you look at all this the dow has indicated a little higher than it was before things started. we're up about 80 points the yield did come back on these numbers. what do you do as an investor? >> all markets are forward looking including bond markets and inflation markets. so the cooling of inflation has been priced in for a while the market has been very confident the fed quickly hiking rates, although they were probably late, is going to cool future inflation expectations. today's data was totally in line where they had moved before today's data to your point a lot of this data is backward looking. that presents an opportunity for investors to say look, the market is pricing a 2% symmetric inflation going forward. you can see that in the five

hoof year, the break even curve it's around 2% that presents an opportunity for investors to say fingers crossed, we hope the fed's got this, but in case they don't, it's a good time to add inflation protected bonds to your portfolio and other inflation strategies because it's all priced around 2% right now. >> let me ask you, nancy, what you have seen in earnings if anything that changes your mind, too. >> definitely, the consensus with wall street is that we're going to be either in a recession or earnings recession. so i would say the surprise would really be if we did get not as bad of a scenario as people are expecting i think there is definitely a lot of fomo in equity markets, you know, last year consensus in june, i had the pleasure of being on cnbc and said, i don't see knnk that terrible i don't know why everybody is freaking out in the equity market and it did rally back that was actually the low of

2022 so i think investors have to just expect the unexpected and really have a diversified portfolio and look for things in their portfolio that can help diversify when equities do sell off because it's really, there are a lot of factors that impact companies whether it's the labor market or still supply side disruptions that the fed hiking policy rates isn't really going to touch that's just hitting the demand side of the equation i think it's time to be prepared for any outcome because we have had one of the highest and fastest tightening cycles in the history of our lifetimes, and also with the fed unp winding their balance sheet for quantitative tightening, that's new territory. we haven't had that before >> steve, is there anything in the numbers that changes the fed's mind for next week were they already going into the meeting thinking they were going to lighten up a little bit >> no, i think they were going into the meeting thinking they

were going to lighten up they want to see the effects of what they have done and want to step down. they do acknowledge there has been first better inflation data, and second, somewhat worse off manufacturing data as michael strain correctly pointed out. this notion that was just brought up that consumer spending was weak, i think is worth noting and i can't -- probably the third time this morning i'm pointing to the data for tomorrow we'll see how weak the consumer was going in, and by the way, it's the first time in quite a while that we have had contributions to gdp from inventory and from trade what's been happening are these wild gyrations in the gdp numbers from you have the ports backed up and all of a sudden they get opened up and you get an influx of goods they get stocked on the shemps and you have nothing coming in this is the 1st time you had positive contributions from

both i think the trajectory is softer, but you have to take that with a grain of salt because the expectation for this quarter had been for a much softer quarter, and here we have 2.9%, decent final domestic sales. and so you have to say okay, this economy is supposed to weaken quite a bit but will it really >> got it. want to thank our panel. good to see all of you this morning. >> our guests this morning, barry sternlicht, has been with us for the last hour and 15 minutes or so. i want to change gears i think you saw earlier that chevron announced it's going to be increasing its buyback to $75 billion, three times the old buyback limit from 2017. they're also raising their dividend by 9 cents. there's now comment from the white house on this, as you probably expected. the white house comment is for a company that claimed not too long ago it was working hard to increase oil production, handing

out $75 billion to executives and wealthy shareholders sure is an odd way to show it. we continue to call on oil companies to use their record profits to increase supply and reduce costs for the american people probably not too different than what you anticipated but what is this going to mean in terms of what companies - >> handing it out to wealthy shareholders, the people funding the operations >> wealthy shareholders. >> pension plans iras >> that's insipid. >> the rhetoric of washington. yesterday we talked about this rent regulation coming out of washington it's self-defeating. you're telling people they don't have to pay rent and we can't kick them out we're all good citizens. we all of us, we work with our tenants. we try not to, you know, we have hardship cases, we'll work with them, but if one person, five people in a 500-unit complex don't pay, the other 495 say why am i paying?

and we have debt service, real estate taxes to pay. real estate taxes pay the operations of all the cities these people depend on it's just politics they're just mining votes. >> wouldn't giving shareholders all their money back be a good start -- wouldn't it be a good start to ending the fossil fuel industry that's what they said they wanted to do why not -- why aren't they happy? >> they don't want to drill, and they're saying we're going to buy back the stock it's 20% of the float, an enormous commitment. there was a bond deal done yesterday, they were selling an oil deal, and there was 70 times oversubscribed, so there's still money, saying there's extraordinary value in oil and gas. oil and gas is transition. aoc and her green deal is ridiculous we all want to go on renewables. it's better for 100 reasons for the country, for the economy, for the nation's defense, for not relying on foreign oil

even the middle east is transitioning to green economy they're aware. they're going to run out of fosulfuels, but we can't get there over night doing so creates inflation, which is what the democrats don't want it's politics. it's populous politics and corporations are not evil. we employ all these people we create jobs so i think the government should focus on things they can equally do, like defense we can't do defense spending cities can't do defense spending, and trade policy, and incentives, driving investment into industries they want to see take off, like evs i don't have a problem with their ev subsidies >> you're okay with industrial policy on certain things >> that's long term planning directing capital flows into things the government will get long term benefit from >> ron klain is still there. that sounds like his fingerprints

>> ycrazy. >> barry, i want to thank you for being with us today. barry sternlicht, good to see you. up next, we're going to get jim cramer's take on the trading day ahead. futures will show you they're basically where they were today. dow futures slightly about 72 . nasdaq futures up by about four points at 119, and the s&p up by 21 points. you're watching "squawk box. with its customizable options chain, easy-to-use tools, and paper trading to help sharpen your skills, you can stay on top of the market from wherever you are. power e*trade's easy-to-use tools make complex trading less complicated. custom scans help you find new trading opportunities. while an earnings tool helps you plan your trades and stay on top of the market.

92% still active? seems high. seriously? it's just a bike. wait. they make a treadmill with an intuitive speed knob? yeah. want to try? 92% stick with it, so can you. start a 30-day home trial today. terms apply.

okay, want to get down to the new york stock exchange, where our good friend, jim cramer, joins us now there's a couple of stocks i want to hit, as you might imagine, tesla being one of them i want to hear your take on these numbers we heard in the last 25 minutes here >> the economy's really hard to derail i think that one of the things that we're seeing is that industrial part of the economy, it's just very hard to make it quit it's -- even when you say, like, company like dow chemical, maybe housing is bad, but that's about it they were lower. i pick on them because they're a little bit lower, but like a new

corps, their numbers are incredible there's a lot of good happening. i don't know whether jay powell wants that, but there's good happening everywhere >> are these numbers -- is this a good number that turns bad because jay thinks it's hot? or you think not >> i think jay thinks it's hot it's hard not to feel that way i mean, i'm going over the companies, and i'm just -- look, we have a big week next week, but other than enterprise software, which is horrendous, there's no cuts in the economy there's just -- nobody's cutting jobs >> what do you think the jobless claim issue -- i don't know if you caught this. we were talking about, so many people are getting laid off, especially in the white-collar space, but they're getting severance, so they're not asking for more money right now >> it's funny. we were talking about that this morning. the severance packages are so generous that there's just -- when you talk to a younger person who got laid off, it's like the time of their lives they're like, wow, okay, i'm

going to disney world or disneyland it's just one of these things. >> wait a minute how do you account for that in terms of what we're seeing in the economy right now? there is almost like a pandemic situation here where people are taking these stimi checks, effectively, and continuing to spend, and it's sort of hard to know what that looks like three, four, five months from now >> i think you're absolutely right. especially if there's younger people and they don't understand that you have to save a little there is -- there are -- finally you can get engineers. if you feel like you want a job, there are a lot of engineer jobs you just have to be in aerospace. you can't be in enterprise software that is where the weakness is, and that's where the job growth was, and that's where all the vcs were i was sick of them, frankly. >> we have to run. >> why what do you got? what do you have to do >> i want to know what your take is -- i'm -- we have another guest, but tesla, i'm -- i mean, pretty good numbers.

>> i love it i just love it just basically said, you have to look into a telescope to find anybody close to us. he did praise the chinese. he said that he's much better than nvidia, which i don't think is true. but it's just a confident, fun call it's giving -- i was watching those 76ers play last night, playing the nets i said, turn it off, i got the musk conference call much more exciting >> i made money. the knicks covered >> parent company of the network? what do you think? >> i'm not proud, but i think the overall number wasn't bad. you have to look at the constant on sky not bad. cable, actually, really good our division trying to get my arms around it >> all right jim, we will see you >> that's it i know, you have another guest >> we love you, but maybe we overbook i don't know i think we have to sort of -- >> i don't know how it works that morning joe, he has like 72,000 people on you do what you have to do >> see you in a little bit, my

friend >> all right >> morning, chuck. his name is chuck. charles scarborough. recapping this hour's economic data, fourth quarter gdp coming in at 2.9%, slightly better than expectations joining us now is marion bartels, chief investment strategist at sanctuary wealth are you surprised that the dow is managing to triade higher on what looked like a pretty hot number it should in a normal world, but the one we're used to is as good as bad >> i think the market is really struggling in what direction it wants to go to, whether or not it wants to break to the upside or break to the downside but i think that all the data today will suggest that the fed is going to continue to tighten, and they're going to continue to tighten maybe at a slower pace, but things are, you know, some areas are hot, and some areas are not hot. but the big message that we wanted to say in our year ahead in 2023 is that the bull is

already running. there's a pocket of our market that is on its hair, and it's in the value space. it's in energy it's industrials it's materials we think the bear is still hiding out in tech and tech-like names. >> i mean, it's -- there are pockets, but the overall averages have done well since the beginning of the year, and i don't know if you've noticed in recent sessions, all of the angst, the earnings angst in the morning, by the time it's all said and done, the market has done much better than where it was in easily the middle of the session. so, there's buying that's coming in i just -- what about the vicks you worry about how low volatility is and that we haven't had a final retest of the lows, mary ann or do you think we'll eventually get that >> i am concerned. we have had a terrific month i don't think anybody really wants to lose those gains. we only have four more trading days, so i think january is going to close really well and you're mentioning the vicks

is very important. maybe in february, we get a little bit of a pullback, and i think that pullback will really be the true message on whether or not this market wants to go lower or whether or not we're going to reach a point where we can go higher. you know, the technicals, i can give you a bull story, and i can give you a bear story. in earnings, i can give you a bull story or a bear story one of those will have to surface at some point. >> the ten-year just will not cooperate. do you think that the ten-year knows something that either they -- they get up to maybe a higher, you know, fed funds rate, but they stop, or do they come back down by the end of the year why can't -- why is it so hard for the fed to convince the ten-year it should be higher >> people in the market are looking at where the pockets are slowing down you have leading indicators in bear territory you have all the ism in bear territory. housing in kind of a

contraction. so, there are pockets slowing down, and it's a great point that you make, joe the ten-year is really trying to tell you that they think that the fed is fighting inflation, and that there's a recession >> right, long-term. okay >> so, i think it's going to be hard to get to a new high on the ten-year >> very good thank you. we are out of town -- out of time you add another person, it's nine, 10% more info. >> 10% less if you take one away >> make sure you join us tomorrow we're over oh my god. something's going to happen. am i going to die? "squawk on the street" is next ♪ good thursday morning, welcome to squawk"squawk on the street," i'm carl quintanilla with jim cramer. david faber has the morning off. futures resilient in the face of some hot eco-data. whether that's durables or