uber have you seen disney stock 84.11. do you know what that is 32%. also uber ceo will be with us. wednesday, february 8th, 2023. "squawk box" begins right now. ♪ good morning, everybody. welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. if you want to take a look at roy's happening right now, you'll see there are some modest declines dows futures down by 40 points,

nasdaq down by 15. you saw the market go down after hearing some of jay powell's comments that's the idea, that inflation, if it does stay like this, you're going to continue to see more rate hikes, more work to do than anticipated by the end of the session, all the averages were highering you saw the s&p up by 1.3% the nasdaq, a gain of 1.9% that's just on the idea he didn't double down and get more hawkish as he had sounded last week you'll see the treasury yields is yielding at 3.65% still well above 3.6%. meanwhile let's talk about last night's state of the union address, president biden laying out his vision for moving the economic agenda forward, an an opportunity to call out profits for oil companies and corporate buybacks >> have you noticed big oil just

reported its record profits. last year it made 200 billion dollars in the midst of a global energy crisis. i think it's outrageous why? they invested too much in domestic production, and when i talk to a couple and they say we're afraid you're going to shut down the oil wells and refineries anyway, so why should we invest in them, i said, we're going to need oil for at least another decade, and it will exceed beyond that we're going to need it production if they had, in fact, invested in the production to keep the gas prices down, instead they used the record prices to buy back their own store and rewargd their own ceos and shareholders. that's why i propose we quadruple the tax on stock buybacks and encourage long-term

investments. >> i want to bring in heidi heitkamp, founder of one country project and mick mulvaney a former white house chief of staff. thank you both for joining us. heidi, you know, there were moments where i thought he had did a very good job connecting with the economic issues of the day. on that score around the issue of buybacks in particular, around oil profits, he eff effectively why the oil companies are not drilling and then said ten years. for mohs -- most ceos 10 years is like a nano second. what did you understand? >> i think it dependsen what the horizon is for return on invest money and especially for

drilling and refining. a return on investment, you i'd have to raise prices pretty high to actually recover the amount you would be investing i think ten years is a horizon that's unrealistic practically, but it's not enough to encourage people to make the investments i think there was a little bit of pandering maybe to the other side, but at the end of the day, it's about the buyback. >> is it dead on arrival i mean obviously there was some taxes on stock buybacks that was just put into place. you also heard him talk about a billionaires tax, 15% billionaires tax, a millionaire's tax as well,

something that was akin, i think, to what president obama back in the day in 2011 talked about being the buffet ruchlt do you think this is actually something you're going to see or is it theater? >> it's theater. state of the union in general is theater. this is the one time the president gets to talk to people who don't follow politics very well he's not going to go into all the details. teen the extent there might be some appetite on the republican side to maybe look at tacks as a way, i i don't think the democrats are willing to give the spending cuts in order to get a bipartisan deal. i don't think those proposals really have much legs in

washington, dc. >> you talk about spending i don't know if we have a video of it. you can tell me whether you think he renegotiated the debt ceiling in real time in fromtd of the public where he effect iively said we're all in agreement, meaning everybody in the chamber around not cutting back on social security and medicare mick >> i did see that moment and i think that's entirely fine a lot of republicans said they wouldn't touch social security or medicare. donald trump said the same thing. the budget i wrote in 2018 was the massive reduction in mandatory spending but didn't touch social security or med carry. we spend $4 trillion on social security and medicare every year there's state a lot of other entitlement spending you can look at. i thought you did see a moment where people agreed, look, there's a lot of other stuff we need to look at before you look

at social security and medicare. if you can't cut it, you're never going to get a chance to look at social security and medicare i think it was a good moment and i think it helps sort of drive the discussion that there will be negotiation on spending, but it won't touch on the major, major programs. >> were you struck i thought there were these american first like elements in parts of the speech especially when he got into the buy american stuff and infrastructure there were srt of pieces of it that i thought were uniquely bipartisan perhaps. >> yeah. and some was like trump with biden. we're going to use materials here you could have taken that out of any state of the union speech donald trump gave. it goes to squloi where the center of gravity is in washds 20 years ago nobody would have stood up for made in america stuff because we know it costs

more money, costs more to do it that way, but donald trump changed that there are a lot of things that could be bipartisan. i still come back to the attitude toward china. it's one of the few things we have right now there's a basis for it. >> that's why it's called popular. even the oil bashing is kind of popular. >> to a certain extent, joe, it is but people still have to buy gasoline. >> that was pretty funny that got a good last almost sounded like a bipartisan laugh. that's nice. >> heidi, i was going to refer back, though, to some of the buy america stuff. and going to the point mick was making about politics and how people may not follow politics or economics may not necessarily

understand, for example, that made in america sounds fabulous in certain ways, but on the other side of it, there are real costs associated with i. i wonder if there's a american disconnect with this or not. >> let me kind of calibrate this ta tammy baldwin has been a champion in buy american and she's been voted down. maybe though there is a clapping and nod to trump policies, there a deep-seated concern about buy america. i think, andrew torque your point, how is buy america different from america first it was interesting because biden was speaking to our trading partners when he said, we could to all of this and not violate wto rules. we're con front a hostile

attitude toward that in europe so this is much more complicated than standing up and giving a speech about buy america. >> do you think there's a chance the inflation reduction act gets appealed, hideidi >> no. we have a governor spending as we speak i think this was politics when people butted against the inflation reduction act and i don't think it's likely it's going to get repealed. >> do you think there's a chance it's overhauled to soften americans because that, as you mentioned, has infuriated some of our european allies. >> i think it's hard to say. it's got to play out as you saw in last night's speech, the buy america or inflation reduction provisions are what biden tends to run in 2024 on and i don't think he's

going to let anyone disrupt that, and as you know, trade disputes take a long time to resolve. it's almost a badge of honor when europe says you're overprotecting america. >> heidi, put your hat on. is this a re-election speech >> i agree with mick a softening of the 2024 campaign he laid it out i think he enjoyed the back-and-forth with the republicans because it set the ground rules for what this campaign's going to be all about. >> professor heitkamp, we need a letter grade you're a professor now, you're teaching. >> they don't do that anymore.

>> oh, come on, joe. >> that was mick. >> i agree though. grade it on a curve. like at harvard, that was an a. >> i would give it a b plus. i would give joe a b plus. >> mick mulvaney, professor mul mulvaney >> i like that show thought i was joe kernen he was engaging. as a political speech, very good last night as to get something done in washington, nthat wasn't the purpose of the speech. >> i played golf with trump. i wasn't chief of staff. you have to live with that. cvs health rumored to buy oak street health is now

official at $39 a share, valued at $9.5 billion excluding debt it will expand its footwork. it's been approved by the boards of both companies. we'll hear more from cvs they're due at later today at 3:00 p.m. eastern time karen lynch will be talking about all of these things. bertha coombs said this would be good for cvs it makes it harder to get some of the federal funding there meantime we're going to come back in just a moment. >> we didn't talk about monday. >> monday the stockmarket did not go down. >> it did not. >> the 10-year is 365 or something today.

a the 2-year, i just saw -- >> almost at 4-5. >> powell said inflation is coming down. >> which is a very nice tease for what we're going to do next. when we come back, the big takeaways from fed chair jay powell's inflation and the path operate hikes. we'll discuss that later oi'll be going downtown to bring you a first cnbc interview with ceo dara khosrowshahi first on cnbc.

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complete connectivity. one solution, for wherever business takes you. comcast business. powering possibilities. fed chair jay powell said yesterday inflation is beginning to ease but he skpucts it to be a long process he warned interest rates could rise higher if the market doesn't participate. check it out by the end of the session, the dow was up by 265 points joining us right now is paul zemsky he's voya's cio of multi strategies and solutions paul, the market was of two minds. yes, the rates could go higher than anticipated on the erie side, he still continued with that

disinflationary thought process, the more dovish tone than we've heard recently i think you're of the opinion you're going to be looking aet more dovish tones, right >> absolutely. last year was a year of so much uncertainty. this year we're starting to figure things out. from a market's perspective, i think the fed needs to tighten the 25, 50, or 75. it's not going to matter all that much. we're not talking the fed to go 6 or 6 1/2 a year ago, nobody knew how high they were going to go. a lot of uncertainty this year, we're almost done, but there's another 25, 50, 75 still pretty close to finish. >> i think that's a really interesting perspective. i think it explains a lot about why the markets may have been so bullish into the first month and second month of the year you do see red arrows in the morning a lot. joe was talking about this we saw this monday, we saw this yesterday, where it looked like

we were going to open up pretty low, but the markets are clawing back maybe this is the worst of the right hikes. >> there are rate cuts priced in at the end of the year it seems far-fetched if they get it down to 3.5 by the end of the year, that's a real factor. if that drops by 100 basis points, the fed is going to be 100 basis points tighter and the end of the year, so they'll have to figure that in. when the u.s. markets open, people focus on the fundamentals here. >> if that's your thesis, do you buy into growth stocks those are the ones that have been hurt so badly by what the fed has been doing. >> select growth companies that have no earnings, we're not going to go back to

the pre-fed tightening era anything like that is going to get credible multiples however, quality growth stocks that have been beaten down, absolutely it makes sense. >> do you think markets have bottomed at this point >> yes i don't see us making a new low in the s&p we should make a new high in the 10 y- 10-year. the other thing is people keep creating earnings. the comeuppance is profitability is still hiker earnings are still high we're not going to have a deep recession. if we have a recession, it's going to be a mild one overall you have to think, if i sell stocks here, can i buy them cheaper to make it worth weil? i don't think so. >> what i don't understand is why you're so convinced -- i

listened to this gayed and thought he's going to keep going and going and going and going. >> i think one or two tig tightenings makes sense. >> i know you think it makes sense. >> he's a fed chairman he can't lock himself into it. the data on friday was startling. there's a good point that labor is still being thwarted. other parts of the economy are slowing down i think you'd want to take the mosaic if we have a couple of other employment number like that, absolutely, the fed's going to have to think about another 100 or not more. >> that changes your calculus then. >> of course it would have to if you look at the mosaic, it's reasonable to assume the fed's going to let -- maybe go one or two more times and let the tight

financial conditions play out. >> we're not going to three, we're not going to three and a quarter, 2 two and a half. they don't have to get to 2 president 5% don't declare a victory and 3% or 3.25% the job owning is part of the process. that's why i i don't blievt. that's part of the game. we're in on the joke. >> the fed had to convince everyone they would take a recession if they had to they have to being aally irrational. >> i think inflation is transitory, i swear to god i'm ready to bring it back full force. it's not like the '70s or '80s. >> no, you're right. it's very reasonable.

>> they'll say they good so scared about being wrong they're going to end up being right, that probably it was supply chain related and reopening related. >> i think a lot of it was i absolutely agree. >> all right energy, putin, putin, price hike, thank you, voya. coming up, pollster frank luntz joins us on his take of joe biden's state of the union, the positive responses as we head to brake, here are some of the positive forces the president spoke of last night. >> we'll make companies disclose all fees up front and we'll prohibit airlines from charge 50g round trip per family just to be able to sit together baggage fees are bad enough. airlines can't treat your child like a piece of baggage. americans are tired of being played for suckers

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time now for today's executive edge du jour of the morning. zoom announced yesterday it plans to cut about -- it was yesterday when it happened i'm doing it today cut about 1,300 jobs in a blog post on the company's website the zoom's ceo said the company needs to adapt to the uncertainty of the global economy and its effect on zoom commerce he's taking a 98% pay cut and forego his 2023 corporate bonus.

zoom shares rose 20% higher following that news. separately, ebay is laying off 5% of its work force as it looks to navy gate on what it calls global economic headwinds. still to come this morning, pollster frank luntz weighs in on the president's address to the nation and the response of the republicans. that's next. through the month of february, we're sharing black heritage with some of our colleagues and others. here's cnbc "techcheck's" jon fortt. >> a couple of years ago around the time george floyd was killed, i created a course called "the black experience in america. i originally designed it for our two sons i ended up opening it up to a broader audience by putting it

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good morning, everybody. welcome back to "squawk box. we are live from the nasdaq market site in times square. dow futures down by about 60 points the nasdaq off by about 18 the s&p down by 12, but every time we've been down in the morning this week, we've shaken things off by the end of the session. cvs health just reporting earnings coming in at $1.99 a share. revenue strong too. >> 82.85 on the revenue versus

an estimate of 76. 7% same source sales gain and the pharmacy up. the front of the store sales not up quite as much the guidance has been jauflted the street's at 8.63 so the company just beat by seven cents. that hits 8.70. >> but they give up guidance th there, 8.70 to 8.90. not everything flows down the line medical costs is one of the headlines. you look at med cat cost ratios with the other ones, 86. it's like a reverse profit margin. >> total farmly claimed process up 82.3%

maybe people are getting back to health care after not going as much during covid. that could be helping things too. >> when i do go to a drugstoring i have trouble finding a parking spot, so -- >> or any tylenol for kids. >> yeah. or dayquil for anybody. >> there's a demo of people that are in drugstores, right >> yeah. like our viewers cable news viewers. >> or just like us. >> i'm glad you threw me in with you. we're basically contemporaries we were both born in the 20s century. >> oh, stop. our next guest took issue with a number of things with president biden's state of the union address. you're kidding let's bring in pollster frank luntz, and political strategist.

i guess they've got me all produced here, frank let me read this frank, let's start with medicare. >> some of my republican friends want to take the economy hostage, i get it, unless i agree to their economic plans. all of you at home should know what those plans are instead of making wealthy pay their fair share, some republicans want the medicare and social security sunset i'm not saying it's the majority. >> when i was -- i think you know speaker mccarthy. everyone i talked to yesterday in dc, i used the alternate facts economy because if you're in the hin ter lands and you're watching and you watch what president biden says and then watch what sarah huckabee sanders says, it's like they're living in alternative realities, and i got that a lot yesterday i mean that's just -- you've been doing this a long time.

politicians are going to spin, but it seems like we're even further apart from deciding what's actually factual. >> look. the first responsibility of the president is to tell the truth look americans straight in the eye and tell them the way things actually are that's a lie i don't like doing this because i don't want to add to the division i don't want to add to the acrimony but we have an expectation and it's a legitimate one for the president to tell us the truth and we deserve the truth both the speaker of the house, the republican leader of the senate were declarative over the last 48 hours in saying social security -- and i quote -- is off the table. he knows that. it didn't matter to him. this is why i do believe he's actually going to declare his candidacy because only a presidential candidate would say something like that knowing that all the evidence, all the facts are exactly the opposite

so i'm there in the chamber last night, up in the gallery, listening to this, and people around me were shocked because they know the truth. look, we can have an argument over debt and the dell ceiling, over the votes, over cutting waste for washington spending, but in tend you have to look into the camera and say what is factually accurate and the idea that republicans are going to sunset -- not just trim or reform or strengthen but sunset social security is crap and i would use a stronger word, but i don't want to get kicked off your network. >> where do you want to start in terms of what we hear that's not factually correct? i know people say trump -- you could tell he was lying when his lips moved i've heard that. but record jobs production, we're exactly where we should be we closed, came back up, and

where it should have been. it's gooding it's great, but you didn't create 12 million jobs. 12 million jobs came back. you cut the def sit. it wouldn't be that large if you hand spent so much money it's less than when the pandemic started. the border is secure it's not it's incessant spin. take your pick to where you're going to point to falsehoods or at least distortions >> the issue is now people make financial decisions based on what the president said and based on what cnbc says. so we actually have a responsibility when lives are orer on the line, jobs, corporate planning, to be accurate about this or how can american people trust numbers and trust what happens with the debt ceiling when the president is prepared to literally make

things up? i don't want to rupp out of type i was in the chamber and i didded will to what was happening by the members i don't know if you've got a segment to show. >> here's another one. i'm going to intro a sound booichlt frank, you didn't like some of the sound bites in the chamber last night. >> i'm glad to see i enjoy conversion it's amazing if congress doesn't keep the programs where they are, they'd go away. other republicans would say -- i'm not going to say it's the majority of you. i won't eve say it's a significant number, but it's being proposed by individuals. i'm politely not naming them, but it's being proposed by some of you look, folks. >> i don't want to single anyone out, but in tend this looks like a high school assembly this looks like -- or par

parliament that is not our system of government. >> you, you, you, you. >> let me finish so. >> go ahead. >> it is wrong for elected officials to act that way, that we give the president his or her moment to communicate what they believe is the state of the union and then you get a chance as sarah huckabee sanders did to respond to it. i'm an advocate for civility i'm an advocate for respect. i'm an advocate for us not destroying ourselves and tearing each other apart please it was happening on the democratic side as well the cheering, the cat calls, everyone getting up, performance art. joe, we need to calm down, gain respect. >> i'm glad you see it on the democratic side. i don't know where you've been were you around for the trump presidency >> yes, i've been on your show

joe, let me finish it happens on both sides let's hold both sides accountable. let's ask both sides to lower the decibel level. joe, at least you have to call for it you don't accept the country coming apart i've got two of my students off camera that you're seeing right now -- joe, we need to calm down we need to -- what is wrong with this -- >> we went through four years of trashing one president and now we do it once with the current president and you say stop it's not like. that you can't -- >> joe, i've been calling for this on your show, and you and i constantly argueover this because you think it's acceptable and i don't you think it's perfectly -- this is how you behave, joe cut it out we need to calm down. >> joe, don't tell me to calm

down i'm going to do what i do because i think it's right you're not going to ride herd how to conduct this show you're on every three weeks. >> be decent be decent. >> try. >> i try. >> you're very virtvirtuous, thk you. when we come back, chipotle with an earnings miss. we'll tell you what the consumers say. down about 1.5ch. later uber recording fourth quarter results in just a few minutes. we'll be talking with the ceo dara kh orowshahi. and a programming note, charlie munger and investor awil be speaking at the shareholder meeting, the daily journal that's going to be streamed exclusively on cnbc.com next

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s of chipotle are falling on a call, the price hikes that have driven profit margins may be at an end given the possibility of a recession the company said higher labor costs cut into its profits, a micr microcosm. put company a, b, c, or d into those comments >> coming up, we'll dig into this year's rebound with technician carter worth. the famous worth hissed myle name is hinak? he joins us after the break. a remind eric get the best of "squawk box" in our daily pod kachlt follow squawkod p on your favorite podcast any time. we're coming right back. what's up, peyton? good morning, peyton. hold for peyton. they'd huddle.... welcome to the peytonverse.

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welcome back, everybody. microsoft ceo satya nadella said search powered by artificial intelligence is the biggest thing to happen to his company in the nine years that he's been at the helm. here's what he told jon fortt yesterday on "power lunch". >> we start in -- with already a business that is profitable, and here's the interesting thing, the most profitable, large software business is search. so i look at this and say, look, i just have to earn one user at a time and incremental gm. i never, ever felt this liberated in terms of opportunity in the days ahead. >> at an event at its headquarters yesterday, microsoft rolled out ai updates to the company's bing search

engine and edge browser. those updates will allow bing to answer users in a way that gives more detailed responses to queries. separately sources tell cnbc that microsoft plans to release software to other companies to help them create their own ai chatbots azure cloud would be the backbone of those new services. meta leading the tech rally this year, up 59%. amazon, alphabet and apple all gaining about 20% so far this year in 2023 for a look at what the charts say about whether the tech rally can last, carter worth, worth charting founder and ceo and that's, i guess, everybody's question at this point, is this a -- kind of a reflex rally can occurring in a continuing downtrend or we made a bottom in tech, carter >> sure. i think to some extent it is all about the sequencing we know that, right, the nasdaq

100 total return, the index plus dividends, completed 13 consecutive years of gains no index has ever done that. there might be a few where there is hyperinflation, but no real index going back to the 1900s has accomplished such a feat and then, of course, a very bad year last year, down 32 so, a ricochet, a rebound is perfectly normal the question you ask, is it just that, a ricochet or the beginning of something more enduring i don't know i do know this that sequencing the sheer nature of the bounce, faang is up 31% year to date, trading 20% above its 50-day moving average at a minimum, one wants to sell calls against long trim just in terms of the sequence. the epic run-up 13 years in a row, positive returns, the impressive collapse, 32% last

year and now this big ricochet faded, trim it, right calls, take some measures >> but you might need to miss -- or to admit that you missed the lows we're not allowed to buy stocks. i would have mortgaged my house with netflix way under $200 after being at $700. >> individual names, sure. you're talking about the aggregate. the thing about the tech move here is it is not specific to large cap, right if you look at tech sectors performance year to date 15%, let's say, versus s&p index itself up 8%, it is the same setup in the midcap and the small cap. where we have a sector outperforming and it is the equal and opposite of defense. tech is up six weeks in a row. healthcare is down six weeks in a row. we know it is ever thus. rotation, flow, but at this point, if one is tactical, you've had so much movement in

one area, equal and opposite out of, for instance, healthcare you take measures, you trim, you navigate within the confines of the -- >> you're using words like trim, you're using words like fade, like sell calls. what about buy puts? >> i would do that. >> you would >> depends your risk nature is risk reversal. >> as the tech nasdaq, with the nasdaq where it is right now, you would think that by year end, let me just see exactly -- i mean it had an unbelievable rebound. so 12,100, you think it goes back under 10,000? >> i think we'll get close >> you do? >> i bet we're sideways to down on the year. that's my guess. >> from here >> yeah. >> sideways to down. >> that's a long time, joe 11 months. if you can tell me where it is going to close today, i'm --

>> carter, 11 months used to be a long time. i can tell you it is not a long time. >> getting a little older, it is -- >> it is not a long time anymore for some reason. >> that would make sense, carter and i don't know what would cause it and i don't know what it would feel like, but we have certainly not seen that capitulation or that moment, climactic moment in a downtrend that everybody is waiting for. i'm hoping that the length of it can make up for it, can replace, like, a 40 on the vix or something. you don't buy that, though you think the vix will get well above where it is right now at some point in 2023 >> vix is depressed on a relative basis, if you will. i think vix has bounce potential, yes >> yeah. all right. okay so, i get what you're saying here so maybe fade it if you're aggressive -- >> not maybe, i would. i would fade it. >> all right

you would. fade it, and either where we are or lower at some point in 2020 and closing the year where we are or lower >> that's my guess. >> okay. all right. all right, carter, that's why you're carter net worth, high net worth. thanks andrew, uber, earnings are actually out >> uber earnings are out the ride sharing company beating on the top and bottom line by the way, revenue growing 49% year over year i'm at uber's headquarters physically right now got a first on cnbc interview coming up with the company's ce do,ara khosrowshahi i can't do this anymore. impossible odds, save the world. i'm done. what do you have for me? a new way to transform our agency. strategy to execution. oh, looks my laces have come undone. a business card? yes, for ey. tech expertise? $2.5 billion invested.

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good morning president biden delivering his state of the union we lay out the key investor takeaways. fed chair jay powell says inflation is starting to ease, but rate hikes are still coming. we have a break down of his remarks and what it means for the markets. and disney investors are waiting to hear bob iger's revival plan we'll preview tonight's big earnings announcement and talk about the state of the entertainment giant as the

second hour of "squawk box" begins right now good morning welcome back to "squawk box" right here on cnbc i'm andrew ross sorkin with becky quick and joe kernen i'm down in uber's headquarters. they just reported earnings and we have the company's ceo on in a little bit take a look at u.s. equity futures at this hour, a day after jay powell spoke yesterday, juxtaposed to listening to president biden at the state of the union you're looking at the dow off 66, 67 points, nasdaq off 12 1/2 points and the s&p 500 off 12 points treasuries we were talk about it in the 6:00 hour, the ten year note at 6.347 and the two-year, 2.444. as i just mentioned, earnings out from uber, that's where we

are right now. ride sharing company beating on the top and bottom lines earnings coming in at 29 cents a share. analysts were expecting a loss of 18 cents. it is a beat you're looking at that stock moving already on that news, close to 7% higher in the premarket. revenue better than expected as well at $8.6 billion company saying he expects to grow year over year gross bookings 24% in 2023 we'll hear about this, the results, the state of the business and so much more from the ceo dara khosrowshahi, 7:30 eastern time this morning in just about 28 minutes from now, joe. >> all right we will, andrew, thanks. to dom chu with a look at this morning's premarket movers remembering your swing, channeling your swing, none of that works but -- >> i didn't get to see -- i didn't get to see that much of the at&t pro-am this weekend i always look for you. >> you didn't see -- you don't

follow me on twitter there is a video of me on 17 you didn't see that? >> i have not. i'll check it out as soon as this morning's premarket movers is done. >> too late. i'm disappointed. >> don't be disappointed you don't want to see my swing. >> don't rub it in. >> let's talk about the big earnings mover, cvs health, shares are higher by a percent premarket, now flat. a little over 30,000 shares of premarket trading volume, the pharmacy benefits healthcare retailer reports profits and revenues beat analyst expectations cvs was helped along by better pharmacy revenues and sales growth at established store locations for all the goods not tied to prescription drug sales. cvs gave full year profit guidance that gave better than consensus. and it reaffirmed and confirmed, made for the record, its acquisition of oak street health we have been talking about that for a while. on balance, shares flat on the session.

now also analyst downgrade on sherwin williams those shares right now down roughly 2% just around 3,000 shares trading so far not helping matters now, analysts at key bank capital markets downgrading that paintmaker to a sector weight to overweight they cited falling demand for their products creating an environment that caps the current valuation paid for sherwin williams shares down on that downgrade we'll end with a check on the oil complex, overall, on the heels of president biden's remarks during the state of the union address last night some maybe more mixed messages that are being seen in nature there. saying there is a more medium to longer term future for oil and gas exploration and production in america, while also attacking the record profits and share buybacks announced saying that oil and gas giants need to pay their fair share of taxes on those record profits but pretty much you got wti u.s. brent crude prices both up by

roughly a percent. exxonmobil and chevron up premarket and the energy sector spider flat on the session now those energy companies, it seems as though there is going to be a debate about just what kind of prospects they have longer term in america but for right now, it seems as though there is at least a little bit of positivity, joe. >> all right, dom, thank you a little bit, anyway this year, this year, let's keep it going we always have to say that, don't we can't root for the markets, we would much rather have it go down 50% and everybody be poor >> no. >> i guess you could look at it that way i hope not, but -- >> that's what i mean. we need to -- i want everyone -- i want everyone to succeed everyone to succeed. >> i think success is -- >> live their best life. >> i'm likie ian arthur brooks guy, not an arthur brooks impostor. >> if everybody can succeed and the economy goes higher, everybody benefits, then, yeah,

we all win >> exactly >> we hope to see that, unless the fed thinks things are getting too hot, have to pour a little water on it, cold water on it. fed chair jay powell telling investors inflation is starting to ease. that's the good news the bad news is, though, interest rates are still likely to rise. steve liesman joins us with more right now. and, steve, there was a little bit of something for everybody in those comments that he made yesterday. >> exactly, becky. and i think the markets gave the fed chair a split decision these were his first comments on that very strong january jobs report and it suggests if such strength continues, the fed may have to raise rates higher than previously forecast. >> the reality is we're going to react to the data. if we continue to get, for example, strong labor market reports or higher inflation reports, it may well be the case that we have to do more and raise hikes more than it is

priced in. >> so markets gave powell a split decision stocks rallied after the speech with some saying powell was not as hawkish as he could have been and then he continued to say inflation is easing. even if bringing it down is going to be a bumpy road but the fed funds future market increases. the peak funds rate had been 4.89 for the june contract before the jobs number peak contract is now august, and it is trading with a yield of 5.14 exactly where the fed is for year end hfb writing after the speech, at a money mum we expect another two hikes with the caveat that rates could move higher than currently expected we do not anticipate an easing of monetary policy this year as we reported this week, the gap between where the fed -- where the market thinks the fed is going and where the fed says it is going, it is narrowed dramatically since the jobs number an argument three-quarters of a percentage point, pretty substantial, is now just about a third of a percentage point and a whole year to work it out,

with the important question of whether the stock market now believes what the bond market is saying, becky. >> so, steve, what is your takeaway on this you sound like you have been coming down more and more on the side of the market than what the fed has been saying. we talked to one investor earlier this morning who just made the very fair point no matter how you cut this, no matter how much more they raise rates, we have been through the biggest section of the hikes this year should be easier to digest than last year, no matter what >> no doubt. no doubt the question is whether or not there is some breaking point here where it is too much for the market to digest when it comes to the equity side i think the fed is going to go to 5 it will do another quarter and probably another quarter after that that should bring it up to that area there it is going to sit there and unless inflation comes down sharply, i think they're going to stay there for quite a while. i think it was interesting, becky, when i thought about why

did the market rise after it initially fell with powell the market has other things to think about. this ai thing is significant you have a whole bunch of corporate restructurings going on and deals being made. i just wonder if the market said, okay, now that we understand each other, me and the fed here, so to speak, maybe now we can get on with their business is there a certain stability and dare i say the word serenity in accepting where the fed is going, saying, okay, let's get on with business, we can start to make investment decisions here >> serenity now is everything relates to it. >> exactly. >> to a seinfeld i have felt like the two of us have been sort of dancing around a relationship in terms of agreeing on things lately. steve. you know what i mean there are times in the past i thought you were, i don't know, i thought you would, you know, say that the fed is doing its best and it is going to be

right, but lately i think that you, like me, have been wondering is crushing demand the best way to run a country versus maybe increasing -- do you want to increase workers, you don't raise interest rates if you want to help the job market, you don't destroy the job market you give more opportunity, don't you? are you becoming a supply sider a little bit, steve? >> let's agree -- let's talk about a few things, we agree on a lot of things, grateful dead, it is fantastic. >> "eyes of the world" your favorite or "unbroken chain" >> i'm sort of, you know, "unbroken chain" is one of my favorite songs but it goes on and on. let's go from the grateful dead and free markets to a more important place, the outlook for the fed and i think the fed ought to be more cautious here as i said 100 times, i think there is this massive adjustment going on, joe, in the job

market, where there were some overhiring from the pandemic, there was -- still underhiring, and there is this massive musical chairs thing going on where we have got to get people in the right place there has been a decline in the participation rate as well as a decline in the workforce and there has to be adjustment and i would hate to see the fed squash the economy in search of trying to get inflation down when maybe it was a huge supply side issue and i've always been a supply side issue guy, joe just a supply and demand economic observer here >> if it was full -- let's say 80% energy, just like -- so that's the world we want, where we want to -- we want such a slow growth world that we don't use any energy, and that's our answer wouldn't it be better to just produce more energy and then let the economy run hot without inflation? that would be a better way to do things get the 62% --

>> we -- we took russia offline, right? that's an important part and we have to get that back and there are legitimate -- we disagree about that. >> that oil is fining its way into refineries. >> not the gas, joe. not the -- look, it has been a major disruption and you and i -- we disagree, i don't want to emphasize our disagreements on the importance of climate change, and we can have that discussion. >> oh. >> just rolled their eyes in the control room when i brought that up, so -- >> please. >> let's leave that to the side and emphasize the positives here >> we got to get rid of the bad weather. that's first and foremost. got to make sure we try to put an end to that near term who is going to disagree with that nobody thank you, steve >> no. thank you, joe >> nobody likes -- that hard rain, horrible hurricanes check out the shares of alibaba, the company just announcing it is developing its own ai chat bo

bot and is in the employee testing phase right now. what did i see, someone is going to -- is that going to -- is ai going to save bing, sorkin there's no way bing some kind of day >> i was on bing yesterday >> yeah? >> i was trying to check it out. i, you know -- >> what did you think? i'm actually pretty curious. >> bing! >> i thought it was -- i thought was pretty good. i think the truth is that all of these chatgpt-like products, does it become xhocommodiphied. >> i don't think it can replace us i don't. can you put in write an andrew ross sorkin joke/kernen debate >> i'll try that >> i'll do that during the

commercial break and we'll come back and maybe we'll do a re-enactment. >> i don't trust it. it will make me look bad it will make the conservative guy look bad they will. the algorithm is trash the conservative guy i know it. don't do that. i don't want to read it. don't do it. >> when we come back, we're going to talk to former house majority leader canter, get his reaction to last night's state of the union and the key economic takeaways for investors. check out under armour that company reporting moments ago. earnings at 16 cents a share, topping estimates and the company raising its full year earnings guidance. you're looking at that stock up this morning as well upbo aut 4%. "squawk box" coming back in just a moment

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or pay by the gig. all on the most reliable 5g network. with no line activation fees or term contracts. saving you up to 60% a year. and it's only available to comcast business internet customers. so boost your bottom line by switching today. comcast business. powering possibilities. in last night's state of the union address, president biden described his new tax on the wealthy as what he called the billionaires minimum tax actually might call it a wealth tax in disguise. robert frank is here to explain all that robert, good morning. >> good morning, becky the president getting big cheers last night when he said he wants to make sure that billionaires no longer pay lower rate than teachers or firefighters in practice, however, this is a 20% tax on all unrealized gains, those worth more than $100

million. so, anyone with total assets of $100 million would pay a taxon annual gains on their stocks, bonds, private business, and their real estate. if a tech entrepreneur has stock worth, say, a billion dollars, they would pay a one time tax of $200 million on that billion dollars in stock, and then a 20% tax every year on any gain after that. so if it goes to $1.5. the next year, they would fpay $100 million minimum tax if that declines they get a credit since taxpayers have five years to pay this tax, they could smooth out the payments and credits over volatile markets. all the tax is paid on unrealized gains would be deducted from the capital gains once it is eventually sold and if you look at illiquid assets, private companies, real estate, you could delay the payment until death, though they would owe some kind of penalty biden administration saying this tax would raise about $360

billion over ten years it goes without saying this has no chance of passing certainly didn't get through the democrats last year when it was first proposed but a wealth tax or some form of a wealth tax, whether through unrealized gains or straight wealth continues to be very popular with the democrats so i think we're going to hear more of this going into the next election >> yes, no doubt robert, thank you. our next guest knows firsthand about the challenges of moving legislation through a divided congress we want to bring in eric cantor, former house majority leader and now vice chairman and managing director at molis and company. we can talk about this being dead on arrival. didn't make it through when the democrats were controlling all of the three houses. probably not likely to make it through at this point, but there is a reason for the president to mention this in the state of the union. what do you think that is? >> good morning, becky i think what we saw last night is clearly the rollout of the

president's re-election campaign these are just, like robert said, there is no way that any of these proposals that he talked about are going to pass we have divided government in d.c. and some of us on my side of the partisan aisle are very glad that the very destructive type of policies in terms of economic growth are not going to get through. >> but let's not just talk about the wealth tax he's mentioning here, let's talk about the other things we highlighted earlier in this program one where he said that quadruple tax on stock buybacks is something he would like to put into place another comment where he said, yeah, the oil industry is going to have to stick around for at least the next ten years i mean, we know this is theater, this is what every president does, they lay out bold, broad things and it is probably easier to do that when you have a divided house of government. which of these are things, though, that you think have any

potential traction or do anything to change investment, the way investors behave in any of these environments? >> well, you know, first of all, let's just start with, again, the fact that there is -- in washington, and i said before that there is going to be very little that gets done, this congress we're in a presidential election cycle. there is a divided government. this president clearly demonstrated he wants to, you know, put -- score points politically. and so if you look at it from a market participant standpoint, i'm most concerned about his laundry list of sectors that he is targeting and that targeting will occur on the part of the administration, its agencies he listed pharma, big tech, he listed the airlines, he talked about resort fees, he talked about as you say energy companies. all of these -- all of these

sectors are under attack on the part of the biden administration and that attack is going to come in the form of the rule-making because he knows he's not getting any of this through the congress >> i know he's not getting any of it through the congress instead of looking at this from the political spectrum, let's look at this again from the investing perspective, from wall street's perspective when you have rhetoric about raising the tax so extremely on stock buybacks, what does that do when you have commentary coming from the president about, yeah, the energy sector needing to be around for another ten years at least, what does that do in terms of the investment that you're going to see going back into oil what does that do in terms of companies thinking about how they make changes or do companies not make any changes until they actually see a law they think is going to be passed >> becky, i think all this has to do with the environment to put capital to work.

anytime you increase the risk, you'll get less of risk and less of capital being invested. the energy sector moment in the space was acase in point the fact that he really believes that, that you can foresee the fact that we're not going to use fossil fuels after the next ten years, that says it right there. how companies are going to sit here and talk too their shareholders and management talk to their shareholders when you got a president that oversees the regulatory state, that oversees permitting process, et cetera, in terms of the heavily capexed oil and gas sector, how do you go in and approve capital to work when you only have a couple of years left after all this permitting and approval process takes place in the energy sector. that right there is the case in point. i think investors realize you got an administration that is

hostile to capital formation, and the expansion of wealth. and along with that comes jobs >> the business implications that no company would want to invest short-term is one thing but the complete ignorance of the dynamics of what it would take to get off of fossil fuels in a ten-year period, there is planes flying across the oceans right now doing international trade. the entire world is based on -- 85% of what we do is based on fossil fuels we spent ten years trying to get off it and we lowered it by a ten of a percent or half of a percent. ten years -- that's clueless that's just -- i don't know whether they know it's clueless, they just decided to say it anyway, but the ignorance of it is worse than not understanding the companies aren't going to invest just -- it is a name. >> joe, you know i agree with you on that. it is just out of touch with

reality. >> staggering. >> it is not what is going on. it is just a political speech. that's why i go back to, again, it is going to have impact on investors. because how do people look at the environment writ large coming out of washington when you have this kind of hostility and this kind of baseless sort of statements like energy or oil and gas will go away after ten years? it just doesn't make sense >> eric, thank you >> thank you in the next hour, folks, the council of economic advisers member jared bernstein will be joining us that is coming up at 8:00 a.m. eastern. andrew coming up, uber shares are sharply higher right now after the company's earnings beating across the board stock up about 7%. we got the company's ceo dara khosrowshahi on the company's latest quarter and so much more after the break. "squawk box" rolls on after this

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now the answer to today's aflac trivia question. a shiver is the collective term for which type of animal the answer, sharks welcome back to "squawk box" this morning the uk's competition in markets authority now issuing a preliminary finding that microsoft's proposed acquisition of activision blizzard could result in higher prices, fewer choices and less innovation for uk gamers. the uk regulator adding that the deal would also weaken the rivalry between xbox and playstation gaming consoles and it was this news that had a lot of folks worried if the uk would seek to block this deal. irrespective of what the ftc or anybody else might do. it is much harder to appeal a decision there so we will keep our eyes on both microsoft and activision stock this morning when we,b come back, uber ot with a better than expected

number look at the stock, up 7% we're going to talk to the company's ceo dara khosrowshahi live from uber's headquarters next to break down the numbers and so much more stay tuned ear you're watching "squawk box.

welcome back to "squawk box. uber beating on top and bottom line this morning with mobility and delivery revenue topping estimates and the number of trips higher than expected

you can see what happened to the stock just on the back of that news, up about 7.5% right now. joining us to talk about it first on cnbc is uber's ceo dara khosrowshahi great to see you, sir. >> great to be here. >> great to see you on a day when you have some pretty great news to report let's break down what you're seeing and then i want to sort of break down what is happening to the extent that you are seeing a larger economy and we can talk about last night and what fed chair jay powell was saying about inflation the mobility number was, i think, a lot higher than people were expecting and then similarly on the food side, how do you see that breakdown right now? >> we're seeing strength across the board. what is happening with uber is during the pandemic you saw a huge shift of spend to retail and that coming out of the pandemic, you're seeing shifts come out of retail, into services that shift is not over we're not back to prepandemic levels in terms of spend on services so what that translates into for

us is record audience, 131 million monthly actives on the platform, up 11% year on year. record trips 2.1 billion trips this quarter that's almost a million uber trips or deliveries every single hour and that was up 19% and also record gross bookings $30.7 billion. >> are you seeing anything about the strength of the consumer there has been lots of questions about how strong the consumer is, whether they'll trade down you see folks trade down in other parts of the economy are they doing it in uber land >> we have looked and looked, andrew, because we want to think about not where the business is today, but where is it going to be six months from now, a year, three years from now and we're not seeing any signs of consumer weakness at this point. now, we may be benefitting from the shift of retail spend to services spend, but we have looked at different consumer demos, based on where they live, et cetera. we looked at eats orders are more eaters going to two-star,

one-star restaurants and we're seeing no signs at all of consumer spend weakness. now, when we talk to our ea earners, about 70% of drivers who are signing on and the number of drivers signing on is up 34% year on year, very healthy, they're saying that inflation is a factor in their decision to come on to our platform so that they can earn more we may be benefiting from that trend. we'll see where it takes us, but right now everything looks green. >> one of the items that looks great, at least at the moment, is your investment, written up, long-term or short-term, what is your sense of when you might exit those investments and what that investment might look like? >> deede >> didi is a good company, but we plan to exit.

we will be free cash flow positive for the foreseeable future we can take our time and sell down our didi stake when the time is right. >> that's not going to be some morning that we're going to wake up and you're out of the stake you think it is something where you sell in tranches >> we haven't determined how we're going to sell or when, but we can take our time and maximize value for our shareholders we're not looking to be an investment manager one way or the other. >> what is -- by the way, you played the role of cfo at other companies. >> sure. >> what is your take more broadly, though, on china and whether -- what that looks like in terms of didi >> i think that it looks like china is getting to a more stable place in terms of the reopening. hopefully it will reconnect with the rest of the world as far as the economy goes and we think our didi stake can be significant value we can realize over a period of time. >> you talked about being free cash flow positive, operationally positive, you say it is something that is going to

happen this year. >> yes, yes. >> q3 situation? >> sometime this year. sometime this year you know, the year before last we talked about being ebitda positive we hit ebitda positive ahead of street expectations. last year we said we would be free cash flow positive, we got free cash flow positive ahead of market expectations. we'll hit it in due course we're in the talking -- we don't want to focus on quarters. we want to focus on many years. >> i'm curious what you're seeing on the food side of the business and where you think that ends the year given the conversation we have been having on our broadcast about what jay powell has been talking about and the cost of eggs. >> in general, if you think about pandemic winners, and food for us was a real pandemic winner, up 300% on a year on year basis, the food delivery basis has been remarkably resilient. our growth is 14% year over year

on cost and currency basis accelerated from last quarter and really the drive there is the continue to add selection, continue to add more restaurants and add groceries as well, about over 10% of our eaters now are trying grocery on eats, which is terrific we are seeing ing menu inflatio our eats business and a little bit of the number of orders in a basket come down so maybe people who are ordering a little bit less in response to inflation. but it looks like that menu inflation is subsiding in other words, it is not getting any worse, not getting any better. >> talking about food, we're here another your office lots of tech companies, as you know, have been cutting back. >> yes. >> they have been cutting back on frankly stuff like that tha is behind me right now what is your plan and what do you think of, you know, brad has come out and said uber should be more efficient, look at the twitter model, folks are looking at what elon musk is doing and saying should we be doing that too. what do you think?

>> well, efficiency for us is not an initiative you embark on all of a sudden when you have to efficiency is how you run the business every single day. and so if you look at uber, since 2019 to today, our total head count over those three years is up 10% for the core business, not including freight, which came with an acquisition 10% over three years our gross bookings over the same period were up 6 0%. so for us, efficiency is something we think about every single day that's getting employees back into the office, getting them collaborating, working together, but we have been very, very tight on costs throughout our operations and we will continue to be very tight on costs going forward. >> all right one cost that i imagine may be a challenge, maybe not, i'm a new yorker, i use uber here in new york. >> thank you. >> the mayor and the city have said that all of these vehicles need to be evs by 2030 what is that really going to

cost >> well, we couldn't agree more. we have said we committed to go all evs, not only in new york city, but all of the u.s., europe, canada, by 2030. and we are making that change already. now, the environment is a team sport. we need partners for example, we partnered with hertz, who is buying 50,000 teslas, putting it on our fleet, so more and more you're going to see more electric vehicles on uber in california, over 10% of our miles now are on evs i have a tesla y, i drive -- >> we were talking about president biden's -- i don't know if you watched the state of the union last night and he said oil will be around for ten more years and there was a lot of laughing in the chamber. >> i think it is going to be there for many, many more years. but i think for uber, our average driver drives four to five times the miles than any other driver in the u.s. so it is very important for us to take a lead if you get an uber driver on to

an ev, it is the same as getting four or five other drivers on to an ev. we're committed to 2030 -- >> what does that cost how does it look >> well, what we invested now, we committed to invest $800 million to help our drivers make the switch over to evs for example, we reduce our take rate on evs, we'll give subsidies to make it more affordable for you to recharge, et cetera. but our investment is $800 million. >> you think people are more inclined to actually get in a car that is an ev? as a customer? there is a service that competes with you in new york city, they drive around -- >> a ton of competition. >> but just evs, that's the whole sort of model. i don't know how successful that model is or not? >> you can choose uber or uber green comfort here as well and what we have seen is customers are willing to pay with their time. most customers aren't willing to pay a premium for an ev, but a four minute eta, they'll wait

for a seven-minute eta, they will take more time to help the environment. we think that's great. >> one of the things we have been talking about incessantly over the last several weeks and when you were in davos, a topic du jour, chatgpt. >> yes. >> curious how you think about that type of technology in the context of uber and especially as you think about creating a sort of super app of sorts, what kinds of questions or conversations, you know, users like myself may be having with that app in the future >> so we think of the applications with uber are going to be much more of our voice being conversational with you. so, for example, at a description of a restaurant can be built dynamically based on menu, et cetera, and personalized based on your interests, if we know you like thai food, for example, or someone else's interests, we think that our voice in terms of customer service when something goes wrong can be much more human and personalized as well

so, generate ive ai has applications for us. we're using large models of ai to price and route and match and one of the technologies that you've seen is up front pricing and up front destinations we have offered to drivers. that's the power of ai. >> that's part of the text deck becomes commodify. how much is this company supposed to be worth, is this something where you actually ascribe massive values to those types of companies or is this just a sort of component part that everybody is going to have of some sort >> i think the models themselves can be commodified, but the data sets can't so if you look for us, we have by far the largest data sets of people moving, demand for movement and supply for movement, whether that's driving people, things, trucks, et cetera, than anyone else in the world. and i think that will allow us

to use the power of ai to match in price in a way that nobody else can. >> we got to run you got another super bowl ad. >> yes, we do. >> you line into the super bowl. you had diddy this year. >> it is a big event and this one is -- >> can't get the jingle out of your head. >> absolutely. it is amazing. >> how much did you pay for that >> i'm going to keep that to myself but we're going to get our money's worth and then some. and diddy is just incredible. >> thank you nice to see you, sir. >> thank you. >> appreciate it. >> uber, we should say, wants a cnbc disrupter 50 company, i don't know if you remember. >> many moons ago. >> we are now accepting nominations for the 11th annual list of the innovators if you're a private venture-backed company, scan the qr code on your screen, go to cnbc.com/disrupters to learn more becky? >> thank you when we come back, activision out with a response to the uk regulators concerns about the deal with microsoft. we're going to bring you those

details next that stock is off by almost 5% this morning we'll tell you what bobby kotick is saying to the staff and tell you what they're saying publicly well. "squawk box" will be right back. s made up work, way back when. ♪ ♪ it's our turn now we'll make it up again. ♪ ♪ we'll build freelance teams with more agility. ♪ ♪ the old way of working is deader than me. ♪ ♪ we'll scale up, and we'll scale down ♪ ♪ before you're six feet underground. ♪ ♪ yes, this is how, this is how we work now. ♪

news this morning. the uk's competition markets authority issuing a preliminary finding that microsoft's proposed acquisition of

activision blizzard could result in higher prices, fewer choices and less innovation for uk gamers the uk regulator adding that the deal could also weaken the rivalry between xbox and playstation gaming consoles. you could see the stock off by about 4.9% on this news. that's because there really is no recourse. if the cma does actually come to a decision and decide this deal is anticompetitive, there is not a way of going through the courts like there is here or in the eu now activision is responding to this sending us this statement, they say, these are provisional findings which means the cma sets forth its concerns in writing, and both parties have a chance to respond. we hope between now and april we will be able to help the cma better understand our industry to ensure they can achieve their stated mandate to promote an environment where people can be confident they are getting great choices and fair deals, where competitive, fair-dealing businesses can innovate and thrive, and where the whole uk economy can grow productively

and sustainably. also, bobby kotick sending out a note to employees talking about how with any transaction of this size, a close review isn't only common, it is expected they say this is part of the normal evaluation process and opens the door to talk about various commitments microsoft can make to try and assuage concerns bobby kotick was here yesterday on "squawk box" and laid out some of the very thoughts just talking about how this industry is much bigger than just consoles, how so much of it has gone to mobile at this point, and there is the anticipation that consoles are not going to be the way forward they look at a lot of different competitors, he lays this out in this commentary too, everybody from apple, amazon, facebook, sony, tencent, a lot of different competitors here this deal is getting a close look from regulators in the eu and the uk where the cma has the last word because there is no appeals process. >> yeah, antitrust, and the teeth are back we'll see how long that lasts. might change a little, i guess,

with the change in congress. but certainly front and center, can anyone merge >> that's the question the entire industry, not just the industry, but business writ large is watching to see what happens here before they put through some of their own proposed deals this is definitely a remember they said it's over then he came back and it went back down. up 32% now i don't know the revival of disney and bob quk x"ilbes.preview the result "sawbo wl right back. prizefighter... ...meets trailblazer. ♪ ♪ classic meets modern. ♪

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disney shares are up 28% i can find a low 33%. the company facing a number of new challenges we get sellt for the earnings after the bell joining us now with what to expect is cynthia littleton. i don't want to turn you into a stock market pundit, but how much have we seen in terms of the disney rebound this year is just overall better market sentiment versus progress being made somehow in figuring out

streaming and what the endgame is we thought disney had it we thought they knew exactly how to do it and then all of a sudden, they said, oh, my god, we have no idea how to make money doing this, and then what happened >> that whole making money part was made clear in their last earnings report. i think it will be interesting to see the commentary. i think with today's earnings call, the commentary in the conference call is probably where you're going to get the most of the news and the sentiment. i think the stock is up in general. like most media stocks after a really horrible 2022 is because you've seen ceos and cfos out there, you know, talk about more sensibly about what they can spend, what the realistic growth trajectory is, what realistic prices are going to have to be for some of these services you know, i wrote a cover story a couple of weeks ago about how

the industry is so far from the good old days of cable economics, the good old-fashioned cable industry, we're still back to that dilemma of trading analog dollars for digital pennies, and you've heard a lot more sober conversation from ceos, and i think that's what wall street is responding to. >> i can't figure that out i don't like that skprechlgs digital pennies. i think we can at least say that the entire world is not just going to cut their cord and go to streaming i guess the demise of network television, it happens and it happens slowly and the demise of am/fm radio. suddenly see those stocks trading. any of these things you write off too quickly, i don't know if you can make these definitive statements what about nelilson and espn.

>> they've got a high-classed problem, an abundance of assets. it would be very interesting to see the growth trajectory for espn and disney+ in the numbers disclosed later today. espn and hulu are the really big question marks hangs over igor with espn -- if -- the day that espn goes totally over the top is the day you know that the forecast shows that the old world of pay tv, cable, and satellite that that is plateauing below $40 m40 millio0 million people that's when you know the few pillars of the cable business are the things holding together the linear bundle. bob iger hasn't gone there bob chapek hasn't gone there that's really a bellwether for

where that stands. >> right. >> and i think hulu, as you know, is -- the future of hulu is wrapped up in the question with your parent company of comcast, and i think it is very hard to predict exactly what's going to go on there hulu is a real question because hulu is a very big seattle, but it also requires a lot of spending it takes a lot to be a prestige player in the scripted business right now, and i think everybody from the mighty disney on down is looking at the numbers, the content spending even netflix on their call, they're on the downside of this spending >> we've got to run. igor is a builder. they pay big money for great assets he's not a belt-tightening person that gets rid of things i don't know is he the right guy? we'll find out, i guess. he's a very talented guy

a good-looking guy don't you think? >> yes, he's straight out of -- he has a lot of other attributes. >> that's okay i think it's hard to say i'd like to go to that man's gym. >> he looks like a -- >> he does. when we come back, white house economist jared bernstein will join us for his take on president biden's state of the union including his comments on inflation, the labor market, and more plus the ai race is heating up we're going to talk about what it mnsorea f big tech and how it could reshape the advertising world. "squawk box" will be right back.

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to be invested in rail safety in the coming years. rail vision has the solution today. learn more at rvsvinfo.com. good morning billionaires, buybacks, billions, a lot of vanxiousness. biden's economic message at the state of the union address top white house adviser jared bernstein will join us in just minutes. activision shares dropping in the premarket as regulators say they're concerned over the microsoft stake. meanwhile uber shares are rallying we'll have all the details an all of those stocks, and

artificial intelligence which seems like if you're not investing in it, you might be falling behind we're going to speak with an advertising expert who's tapping in on all of that technology "squawk box" begins right now. good morning and welcome back to "squawk box" here on cnbc we are live from the nasdaq market site in times square. you can see the dow futures have weakened to down about 116 points s&p futures are down by about 18 the nasdaq down by 38. of course, this comes after some big gains we've seen including yesterday with the markets across the board treasury yields this morning, it

looks like the 10-year is back you're talking 6.35% and the 2-year getting closer to half a percent. in the meantime the uk's competition an markets authority issuing a preliminary finding that microsoft's proposed acquisition of activision could yield lower prices the gamer flagged the deal could yield a rivalry between xbox and playstation. you can see that stock is off by about 4.3% this is a big deal because in the uk, there is no appeal process. if they decide it can't be done, it can't be done we do have a statement of response from activision that stresses the provisional nature of these findings, they say this is at this point exactly what you would anticipate and expect. and in a note to activism ploys, the ceo said they're confident the law is on its side this is a chance, they think, to go ahead and present their side

about why this is a much more important industry than the console industry a lot of competition they point to companies like apple and amazon as companies they're now competing for gaming too. >> let's get over to mike santoli who joins us with more. >> hey, joe. we set up for a little bit of an unsteady start in the markets. the pattern has been strength throughout the day that's been something that the character of the market in 2023 is a little bit changed from last year. that's usually bullish a lot of bull market behavior buried inside this rally we've got here you can't say it's a new uptrend. we are basically right at the upper end of this long-term trading range that goes back to this spring. the market is acting differently and better broad rallies, more highs than lows, i thinks like that we'll see if we're using up the fuel for that in the form of lower yields and more comfort on

the fed yield or not take a look at microsoft we've been mentioning that with regard to the deal and the ai they were spotlighting yechld nasdaq -- microsoft relative to the nasdaq and the broader software sector massively youtd performing over that span. you see it's kind of kicked higher here. it's hard to know what's left here for people who pile into microsoft. it's a good test of investors' willingness to pay up. i think the conventional wisdom coming into this year was big tech was still going to be kind of sidelined even if the rest of the market did well. the volatility index has kind of eased back with that powell speech yesterday it's still kind of bumping along the lows we've seen. we did spend some time below that i know you've been concerned, joe, that we never in the selloff got to these really

intense levels of fear and panic, of people bidding protection in the form of index options on the down side but we're in the downtrend here. this doesn't look like the panic relief, panic relief pattern we had last year. there's no magic level it's not about being too low or too high, but this confirms a steadier market. by the way, stops are acting much more independently of one another. there are ups and downs with the index. that sometimes allows the vix to relax a little bit. >> mike, we did have a -- how long was that bull market and bonds would you say? was it business week, 1981 death of equities, death of bonds. >> death of equities was like 79 it was close to 42, i guess. >> right what does a 10-year period of average or below average equity

performance look like? none of us know unless you remember the '70s. maybe we never get a vix of 40 or a selloff maybe we do this for a long, long time. >> i've heard the argument that because last year the big issues were so obvious and so consistent it was just fed tightening into a slowdown there wasn't a lot of confusion about it the market had a relatively orderly decline of 25% you didn't have those shocks and the threats that the system was actually going to buckle that you sometimes had before where the mechanics of the market get overwhelmed. you don't want to declare victory on this, but you're right. we're still operating within the bounds of this -- the range that preceded the downturn a couple of years it's not as if we're in some kind of shocking new territory

in terms of levels or what the market's doing. >> very good all right, thank you, mike we'll see you. president biden cueing up some of his greatest economic hits from last night's state of the union speech the president called for tax on billionaires and highlighted u.s. job grouc and his infrastructure program he also introduced debts and deficits and drew muttering from gop lawmakers when he blamed trump for accumulating nearly a quarter of the country's debt in four years. >> how did congress respond to that debt? they did the right thing they lifted the debt ceiling three times. they paid american bills to prevent an economic disaster of the country. tonight i'm asking the congress to follow suit let's commit to the full faith and credit of the united states of america who will never, ever be questioned. >> joining us now to talk about the president's economic message

is jared bernstein with the white house economic advisers. it's great to see you this morning. >> you, too, becky. >> thanks. let's jump in on some of the things wall street is focused on he stalked about quadrupling the stocks on buybackings and unrealized gains in the stockmarket. the people we spoke with this morning think both of those proposals are dead on arrival. would that be your assessment? >> not necessarily everything in washington tends to be dead on arrival until the day it isn't these things can turn around quickly. the president scored it numerous times, which i thought was a blockbuster state of the union last night in order to build on the debt reduction which we've achieved so far, it's essential that wealthy corporations pay their fair share no one under $400,000 will see their taxes go up by one penny,

but the days of the top 1% paying less than teachers and nurses, those have got to be behind us as we inject fairness into the tax code to achieve fiscal rectitude. >> hey, jerry, going after income taxes and making sure people pay appropriate income taxes is one thing, but the tax on billionaires, who make $100 million or more, nobody wants to feel like they're defending the wealthiest of the wealthy, but what you're talking about is a different tax, going after gaines and investments that's a horse of a whole different color and it would make a difference to people who are average people it's a different taxation. >> let me respond to that. >> it's not 1% you know it. >> it's the top 1/100 of the top 1%. >> that's -- >> you guys are talking two

different things. >> hold on. >> you're talking about the billionaire tax. >> doesn't pay less than what you said it's not true. >> sorry, wait a second. i think you're con flagt number of issues. the billionaires tax only affects people above $100 million. >> you said 1% you just made that statement. >> that's the top 1/100th of the 1% becky, i want to start where you started. >> yeah. >> the idea of funding the irs so they can go after the wealthiest tax evaders makes -- >> i don't have a problem with that i don't have a problem with raising tacks. >> hold on let me make this point. >> i have a problem with unrealized gains being taxed >> we'll get into that you have no problem with that. one of the first bills the house republicans passed when they got into office was repealing that funding precisely for the irs. that adds $114 billion to the

congressional department why? to allow wealthy tax evaders to cheat on his taxes that's not okay with the president. i'm glad it's noting on with you. let's talk about the billionaires tax you call it take on unrealized gains. the way we see it is a prepayment or withholding tax on future capital gains >> money you might make down the road if the stock durnd turnaround, if you don't see the bubble burst that's my problem with it. it's not an income tax it's a tax on gains you may have at some point or you may not it's a whole different issue. >> if you achieve those gains, then you've made good on that prepayment if you don't, you don't have to. so the rules of the tax actually protect people with capital losses, but what they finally do -- by the werek it is a minimum tax. if you were over $100 million

and you're not paying 20% on your taxes -- >> it's not 207 on your taxes. it's 20% on your wemt, issupposd wealth >> i think we -- look. i think we probably have to agree to disagree that anyone who's making $100 million or more and isn't paying 20% of their taxes ought to do so. >> i think you should pay 20% of your income tax. we're not talking about the same thing, so let's not pretend that we are. >> so the top 1% pay 40% of all taxes. top 5%, 60%. top 10% pays 71% of all federal taxes. this is a progressive system, jared. you shouldn't -- >> it is a progressive system, but -- >> it's not --

>> there's two of you there, one of me here let me have equal time yes, the federal tax system progressive and that's a good thing. >> agreed. >> but there are way too many people of high incomes starting at 400 k and going all the way up who pay, as you heard the president say last night -- as little as zero on their taxes. those who pay 30%, 40%, we have no problem with them we doan go after them at all but if you're a wealthy individual or corporation and you're paying a tax rate less than 15% on your corporate income or less than 20% on your -- on your income including as i -- as becky and i were just discussing, capital gains, we're going to change that that's injecting fairness under the tax koechlt it helps to achieve the kind of fiscal

responsibility that this president wants to built on in the rest of his first term look i think one of the things we can't get away from is if we're talking about building up our fiscal case, we have to talk about the debt krooeling, which came up last night you played it earlier in the show the president was extremely clear on this point. we want to see what the republican plan s and he's absolutely willing to negotiate with them on fiscal policy he's absolutely unwilling to negotiate with them on the dell ceiling. i think if the republicans are truly at their word -- we'll have to see. they've talked about military, social security, and medicare off the table. that means they would have to cut 85% of what's left that's not realistic we have to get the dell creting behind us, and then let's see their plan. >> i think that's a fair point t

idea if you take ewell of these things off the table, you're only talking 15% of the bucket which is something you could go after. i would like to see those plans laid out too i don't disagree with you on any of that i jared. >> good. >> but i think if this is something that should be passed, let's hear it. this something you couldn't get through when the democrats held the house. now that the republicans have it, how do some of these ideaings actually come to fruition i'm not talking about the debt ceiling. i think that will get resolved i'm talk about the wealth tax because that matters to our viewers. if you think there's a real path to these thing, that's going to change i don't see it where do you see it? >> a couple of things. first of all, there's always a path i'm very glad yo awe degree on the debt ceiling but i also want to dissuade you from what i

thought i heard at least from to your body language that it's going to be resolved we certainly hope it will and in the past it has. by the way the president was absolutely right last night when he said the debt ceiling was raised 3 times under president trump without any of this kind of threat to default. so i don't consider that a slam dunk, and republicans can make it so, can put this behind us tomorrow by agreeing to a t two-step process where we pass a clean debt ceiling today and then focus on our clear fiscal path now, talking about that path, the way to staeestablish the kio build-on, the gains the president has made thus far, the historic deficit reduction, is to do two things, reduce costs especially in health care. cutting prescription drinks does

two things it's also important to deficit reduction. but we also have to make sure those above 400,000 agi pay their fair share now, there is always a path to these kinds of policies. it may not be in this congress it may not even be -- sometimes these things have to be in the budget for a while before they get across the ledge lay active goal line. but certainly introducing them is the first step. >> jared, i want to thank you for taking the time with us this morning, and we will see you back here soon. >> coming up, ai is the hot technology so far in 2023. we're going to hear how it sings up can they help siri can anything help siri she comes up with things that under no circumstances would anyone say that. we'll talk more about that

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welcome back to "squawk box" the ai race is heating up. we were told yesterday ai power surge, the biggest thing to happen to his company since the early days of the cloud. >> the first thing that is a priority for me is not about dethroning anybody it's more a priority for us to say how can we rethink what search was meant to be in the first place? google's success came by re-imagining what can be done in search, and i think the ai era that we're entering gets us to think about it. >> becoming a promised and more personalized advertising joining us to talk about that is adam singolda with taboola his company is experimenting with chatgpt

we talk about the first places we may see it meaningfully, perhaps even more than folks writing memos with it is in very personalized advertising how personalized do you think it can become >> i think we can't hear you that's something the ai bots can't help us with but maybe the producers can. >> is it okay now? >> it's okay now. >> i was going to say, good time to be alive with innovation outside of my zoom i think they can step back for advertisers and the advertising community. this is such a good opportunity between all the money that's going to go into gpt with microsoft and google we saw the recent announcements, taboola last week. i think we should expect a lot of innovation around creative strategies and imagine having the michael jordan of creative strategies sitting on your shoulders telling you these are

the suggested titles you should use, images, these have worked in the past. i suspect we'll see a lot of innovation coming our way. what's interesting is good job for microsoft for jumping on this so fast for them the opportunity is to reimagine search, you know, as the main advertising challenge in the world search is almost a $200 million channel. that's great for them to try to imagine that for google, it's interesting they is sort of the triple dilemma. on the one side you have the revolutionalizing search the other is google is responsible for selling 30% to 50% of the traffic to traffic. what happens if chatgpt says here's the answer and you don't know her, there's just so much going on. >> adam, let me ask you about that the promise of chatgpt is

instead of you doing the searching if you will, it's actually providing you with the answer, not five answers or ten answers or if you scroll through all the pages and decide -- right? my question is does the public want it? the reason i is ask whether we the republican have become our own reporters and in some cases are looking for our own truths whether looking up a medical issue or anything, we actually want to go not just to one site that tells us the, quote, answer, but we want to go to five sites that tell us the five different potential answers. >> it's a great question i think there's also a lot of dilemmas with that too on the one side, i don't think search as we know it now will completely go away or go away at all because i believe people

like choichls they want to go through options. this is from the cnbc, this is from "the new york times," this is from a blog i like, and make those decisions. people like choice i think that's the power of search on the flip side of it, it's very valuable to cut 30 seconds. we've seen google experiment with that for a long time. if you ask a very simple question, google will give you the answer at the top. so my guess is that we'll see a whole new service that sits side by side to search. there's a question how our publisher is being rewarded for the information. if you take the information from the ebb with, how do you reward them. >> search has so much traffic with so many publishers, frankly. whether you think it's fair for these ai bots to effect inially be able to train themselves to

report back to users using information they learned reading some site without paying for it, in this case, they're no longer -- it doesn't appear that most of these features are going to have footnotes that people are then going to trace back to. it seems like they're giving you -- it's one way. it's two-way anymore. >> yeah. i suspect we'll see a rev loluto in that because in the past they built large business to the open web and becoming, like i said, almost half the traffic of the internet they're benefitting from that. i don't expect the way we see it will be any version of that because we can't just collect information from the internet and not reward the traders for it look, we've seen also, you know, good examples like buzzfeed and and cnet and now the use of gdp to empower aid writers to know which stories to right and have

more strat jirs around creatives. i suspect there's going to be a whole growth in publishing and journalism on one side to know what to write. but always this company and big companies will have to find a way to reward the open web. >> adam, it's great o see you. appreciate it. we'll see you again soon i'm sure we'll be talking a lot more about all of this. coming up, a new measure of how strongly tesla is taking the country's biggest auto market by storm. st tedayun you're watching "squawk box," and this is cnbc firmness on either side... your sleep number setting. to help relieve pressure points and keep you both comfortable all night. and now, save 50% on the sleep number 360 limited edition smart bed. ends monday.

tesla may have relocated its headquarters from california to texas but they're still dominating phil lebeau has more. >> this is how popular tesla has become in california and why we focus on this? california is the largest, most competitive auto market within the united states. yes, you can say they're early adopters of evs. this is a clear indication of this the model y is now the b best-selling vehicle in california we're not saying the best-selling electric vehicle. best overall it passed the toyota camry they helped tesla move all the way up to number two among brand

popularity for all the automakers in california toyota still dominates it has 17% of the market, but tesla has now gone past chevy, honda, ford. now one out of every ten vehicles sold in california is a tesla. remember, in their annual sales, they are targeting 1.8 milliion vehicles to be sold this year. we've known for a long time the u.s. and in particular california, critical to the success of the growth of tesla, and, again, the target is 1.8 million. and as you take a look at shares of tesla keep in mind the next big vehicle they plan to roll out is the cyber truck. they'll start to see them in decent numbers middle of 24, i would imagine. guess where you're going to see a lot of them, joe california why is that important? southern california, joe, is the largest pickup truck market in the country. a large percentage of those

buyers in california are lifestyle buyers they don't buy it for the utility because they're going out on the ranch or cetera, they buy it for the looks, the appearance, the feel i'll be interested to see what the cyber truck does when it rolls out in california. >> maybe bakersfield or imperial valley you see some of that. >> i'm not saying -- look, are their ranchers and farmers yes. but southern california as a whole, there's a good chunk of those buyers who are lifestyle buyers >> you know what's sad, phil the demise of the prius. i was up in san francisco. five out of six cars and it would be one of those cheese wedge-shaped monstrosity priuses. now they're not. that is staggering >> hybrids overall, joe -- right. plug-in hybrids are just not as

popular. if you look at the sales of pure electric vehicles in california, boom, like that. hybrids, it's grown, but people if they have a choice is the electric car. >> the biggest selling car in the market is an ev and it's tell tesla. >> yes, number one and number two. model y is number one, model 3 is number two. >> think about that. they'd bet geert that grid fixed. plug it in and it's going to work thanks, phil. >> you bet, see you. when we come back, we'll go inside president biden's economic message ahead of the state of the union speech. what can dc get done in 2023 and ayun's too much of a stretch st ted you're watching "squawk box. and this is cnbc we got this, babe. that means that your dreams are ours too. and our financial planning tools can help you reach them. that's the value of ownership.

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uber out with fourth quarter earnings posted a topline meet with a 289% cent profit. they now expect a n 18 cent drop >> we're not seeing any signs of consumer weakness at this point. we may be benefiting from the shift, retail spend to services spend, but we look at different consumer demos based on where we live, et cetera. we look at each orders are more going to two-star, one-star

restaurants, and we're seeing no signs at all of consumer spend weakness. >> shares of uber are high about 7.5% higher no less. >> economic issues dominating president biden's state of the union address. the president asked for republicans to help him raise the debt ceiling and avoid putting nation's credit at risk and he blasted the oil companies saying shares last year used billions in profits to invest more in domestic production. >> they used record profits to buy back their own stock rewarding ceos and shareholders. corporations ought to do the right thing. that's why i propose we quadruple the tax on stock buybacks and encourage long-term investment. >> joining us now, libby cantrell, head of policy for

pi pipco. the point that we've seen bandied about a lot is for all of the braggadocio and that, you have the ooh biases. in the latest "washington post" abc poll, 62% of the people polled says mr. biden has accomplished either nothing or very little in the first two years, and that includes 22% of the democrats some of where's the disconnect >> yeah, i mean there is quite a bit of cognitive disdansonance n many ways. you saw president biden trying to remind voters in some ways of all of the things he and last year's congress were able to get d through, whether it was the

bipartisan infrastructure bill and you look at manufacturing jobs specifically. but this sort of speaks to the polling. he really was leaning into what else he needed to do there was a recognition in that speech that for all of these bills that have been passed and signed into law, there was more to do. in some ways it us was a chance to high light what he was going to do next year but also a segue into his 2024 campaign as well. >> 50% want a different candidate. that's why it kind of rings hollow we heard again from one of his people that historic deaf sigs reduck and historic job gains, one is coming down from overspending during the pandemic they were very big numbers coming down from there was not producing much and the jobs were finally back to where they were

prepandemic. it's not creating 12 million new jobs maybe people are smart enough to see through it >> well, joe, thank you. it was exciting around the capital, and i think the president needed to make a case to his own party he should be given a second term and that's exactly what libby outlined. look at all the great things we've done he wants to be the candidate we anticipate he's going to announce he's going to run for president sometime in the next month or two to get ahead of that and he really did look like he was running for re-election he also believes we have a lot more work to do. i think what he was trying to do is get out in front of what the big issues are going to be this year he tried to frame the debt ceiling before the republicans had a real chance to do that by saying you should do this. trump ran up the debt. he's getting out in front of that argument that's going to be played over and of and over again. when you talk about what we can

do with regard to a divided government, you have to look at such things as the debt ceiling has to be raised he was opening negotiating whether we have to cut social security and medicare at the state of the union i thought it was very interesting but it's the opening salvo. the investors are going to be very focused once we get into the second quarter of the year. >> the sound bite we played, libby, that the oil production should be ashamed about giving back money to shareholders that's kind of the way things work in a capitalistic system, but this is the same individual two years ago said we're going to end the oil and gas industry. just last night he said we were going to need it for ten more years. do you think people understand that that is -- there's a disconnect there and it's

political posturing? really i called it demagoguery the other day to blame oil executives at oil companies. they're very small owners. most are owned by individuals, pension plans, teachers. a lot of people own stocks and rewarding wealthy shareholders is just -- it's demagoguery. >> o we hold some of that debt on behalf of our clients as well look, joe, i think interestingly, though, that message was a bit more nuanced than it was last year. he definitely -- he may not have satiated you, but he definitely acknowledged there was going to be this transition. >> ten years come on. >> sure. and -- that was a bit off the cuff that was actually not in his speech necessarily, but i do think -- joe, can we just sort of focus on some of the things that were talked about that i think from a market's

perspective are not going to happen and including any sort of windfall tax but also when you talked about in the last segment with jared bernstein and becky bruit up a very good point that a billionaire's tax did not have really any bid in a democratic congress, nor would it have any bid in a divided congress. in many ways the things ta were thank youed about on energy but also taxation really are just kind of political talking points again, and i completely agree with dan in terms of the time fraich frame and the lead zwroup a 2024 candidacy. >> dan, do you think some progress was made in terms of convincing the public? the poll numbers before hand -- i still would try to figure out. i think we should ban saying fairness rich people have got to pay their fair share it's said again and again and again. if the top 10% pay 71% and the

bottom 50 don't pay 50, what is fair what is a fair amount? what does a fair tax system look like to you? >> joe, as you know, they pay 42% of all in taxes want's going to happen is they're going to pa a little bit fewer taxes this year and it's going to leave a bit of a hole in tax revenues. we think they're going to decline and it will be to raise taxes even more, which is not what you want to do. so you want to create a more stable tax system. that being said. if you look at what happened in the room, the democrats and congress are much more unified than the republicans there's a realization amongst the democrats. >> a board collective. >> they've got to take that case to voters. the way to do that is through a contrast with republicans. i think that's what he was

trying to achieve last night. >> 16 votes. we could have -- you know, the democrats would could have said, does everybody vote for hakim and they could have said, yes. there wasn't a single one. libby, do you have a way to get billionaires to pay something that makes sense and isn't -- i mean, how would you do it? no way seems to work if they don't pay themselves any income. >> whether it's a good policy or bad policy, the reality is it's not politically viable. >> they need to come up with a good way i guess we've got to figure out in the tax law how to do it, just not complain that they're not by following them. that's the roy to do it. libby, thank you, and dan clifton, thanks. ou thank y. >> thank you. >> up next, the trading day. stay tuned you're watching "squawk box" on cnbc

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all right. let's get down to the new york stock exchange jim cranker joins us right now i want to ask you about some stocks uber moving up sharply after better than expected earnings and earnings what do you think about uber >> it clearly turned the corner. a billion dollars in advertising, everything is

hitting on all cylinders dawa is a rock star and this company is well ahead of where the dollars thought they would be becky, i think it's dynamite, it really is. it's very, very good. >> what do you think about activision blizzard? i know your take on this look t company would be just fine just fine even if the microsoft deal goes away it's surprising to see this reaction >> well, i think there's a lot of arbitraries who are in there and wasn't you don't get that approval, they just leave. they don't think about the company. they were just looking at the arbitrage. let those people sell all they want bobby can do a giant buyback he can do anything he wants. this is a fabulous story, and they had a great year, and they also have a great schedule, so this is the one that i think is most attractive for today's trading. >> all right that's excellent to know what do you think about the state of the union last night? anything that may or may not come out of this >> well, i mean, i think if anyone sells the oils because

the president says they'll still be okay -- we need oil for a decade or so, i mean, those people should be thinking about another career they should be buying big bear a.i. or something. look, the president was contemptuous of so many people in so many different industries that it's just surprising that -- it was surprising. i was really kind of taken aback. >> it's not something that's going to entice any of these executives into spending more money to make sure that we can pump more, get more out of the ground if you're saying, your investment's good for the next decade >> i think he despises the investment class without realizing that everybody's part of the investment class. i remember bumping into him on a train once, and he was so proud that he didn't own any stocks. that was a vindicated position last night in the state of the union address. he hates us. he hates our network where's the anti-cnbc? he hates us. what can i do?

why don't we quintuple the tax on the buyback why don't we eliminate buybacks? the hatred of the people that have done well contemptuous >> all the industries should be -- maybe the oil companies are like utilities maybe the government should run the oil companies. >> i'm taking the under on the oil after that >> maybe all for profit -- i mean, they are all trying for profits. i mean, he's right about that. all these companies -- all these companies are trying to maximize their profits. all of them. what do you say when that's a fact really very little you can say after that if you acknowledge that. >> i acknowledge that, and i also acknowledge that they seem to be very happy to take every possible incentive and credit and everything >> fine, then change the tax

law. >> who's lobbying for it >> on both sides >> jim, we'll see you in a few minutes. thank you. by the way, fos, alkmy wu silverman will be talking to us about the markets.

welcome back to "squawk,"

we're about half an hour to the opening bell on wall street. we're not on wall street, we're in times square. but we're going to talk with amy wu silverman, head of rbc capital markets. we're all trying to figure out what to do, and i'm curious if your view changed at all about the trajectory, given what jay powell said yesterday afternoon. >> no, it really didn't. if anything, the options market would tell you that at least longer term, longer term in options being kind of four to six months out there, we're actually seeing more downside being bought in the near term, the options market has been rambunctious it felt a little bit like the pandemic kind of yolo meme stock craze, we saw so much call buying it's a tale of two tenners so, short-term, there was a lot of bullishness, but longer term, folks are starting to hedge more that uptick is happening >> the question is, who's going to be right?

historically, when you have seen this kind of price action, what's happened? >> you know, historically, it's more the bears than the bulls, but i will tell you the one difference now is for the last ten years, there hasn't been a real alternative, whereas now, if you really are concerned about the market, you can just put it in cash, and cash is a real asset, so i think that's the one nuance too right now >> hey, amy, hang on, because, you know, a legend just walked into the studio. steve wozniak just walked in right now. can we get steve a microphone? i apologize, amy i had an apple 2 gs with his signature on it as a child, so this is a very cool thing to have you here. good morning to you. >> good morning. >> is this microphone working? >> it is working how are you doing? >> i was joking. i'm doing great. >> what are you doing here >> let's see what am i doing here i do public speaking now, and i'm speaking for nbc universal, and visiting them. >> fabulous. >> visiting people

>> yes >> ringing the opening bell. steve, i was just telling linda outside -- i'm becky, nice to see you. i was telling you that you were -- >> you're going to interview becky now. >> great ratings for us in the 6:00 a.m you came on, and everything took off. >> i like that i hear things like that a lot. >> steve, since you're here, we've so rudely interrupted amy, who's our guest, but you've just become our guest chatgpt, we've been talking about it all day and morning and week and month now as the great innovator that you are, is it game changing or not? >> i've spent an entire lifetime really studying brain, computers, the computer will never equal the brain. we don't know how the brain is wired. i was a psychology major when i took my final year of college to get my degree, and we don't know where our memories are we don't know they're in the brain. we know the processing centers are in the brain a lot of these things -- i was very negative at first on any, i don't know, any human-made technology being equivalent to

nature so, it will never be equal to -- i mean, good lord, look at a lot of a.i. examples where you drive a car and try to make decisions the dumbest driver in the world wouldn't make, but chapter chatgpt is so impressive when a machine could beat a human at chess, we said the same things oh my gosh, it's so smart. but it's just following different methods than a brain follows. we want a human that has some emotion and feeling about things, and about subjects, you can really get turned on to them >> that's going to be a while, i think. still going to be a while. >> he just wants it to be better than siri. >> useful to humans, as all computer technology. a.i. is the high end of it, where it follows procedures to learn things you can scan -- if you can scan things a billion times a second, no human could ever come close to memorizing what you can, and then given instructions of how to go -- we go and we borrow things that are online for it to

go look online and find out, what fits the category of the keywords it's pretty impressive but the trouble is -- and it does good things for us, but it can make horrible mistakes by not knowing what humanness is. if you're driving a car and you know what other cars might be about to do because you know humans >> woz, we want to thank you for popping in like this >> i'm just here by accident >> we're over time >> amy wu silverman, we're going have you back maybe tomorrow and you join us tomorrow, and you'll see amy "squawk on the street" is next we apologize ♪ good wednesday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer at the new york stock exchange david faber is going to join us in a moment. premarket giving back some of yesterday's rally as we dive into consumer names today. at least five fed speakers after chair powell's remarks on tuesday as well. our road map begin