>> ten-year note, two-year note. >> when's the coffee available >> well, in milan, if you want to take the trip >> when will we have it here onset? >> onset as i drink my coffee -- >> doesn't have olive rooil. >> i think it's this spring. spring is only a month or two away make sure you join us tomorrow "squawk on the street" begins right now. ♪ good wednesday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer, david faber at the new york stock exchange, looking for some stabilization today after the biggest selloff since mid-december, jim bullard on "squawk" not as hawkish as some may have feared our road map going to begin with stocks struggling to bounce. bullard says markets are overpricing recession risk plus intel's rare move

it is cutting its dividend by 66%, although it is backing its prior earnings guidance. and chinese a.i. warning regulators seeking to rein in a.i. chat bots telling tech giants in the company, don't offer public access to chatgpt let's begin with the markets, though, after yesterday's selloff, jim, reflections on that and the argument that some made that volume, if you were really worrisome, would have been a little bigger than it was. >> yeah, look, i think we're in a cat and mice game. the cat are the bonds. as interest rates went higher, there's selling, selling, selling, but it seemed like future stock, not common selling. i didn't think there was that much to it today, really unbelievable appearance by mr. bullard. calm, not throwing bombs, making sense, therefore completely the opposite, david, of everything i've ever heard. >> everything you've ever heard

from who >> from everybody. i mean, the guy didn't say, things aren't falling off a clc cliff, he didn't speak like a hedge fund manager telling you to short everything or get out now. he offered what i regard as genuine homespun wisdom. >> his rejection has rates hitting 3.75%, not to put too fine a point on it that's kind of where a lot of people seem to have headed to that mid-5s range. >> he didn't seem to indicate there's going to be a recession. he said that -- >> no, no, but he did indicate that you got to keep pushing you can't let inflation get away from you, and with a growing economy, that's still a concern. >> well, i mean, it does raise this question, what will stop this economy from expanding? nothing. but i guess what i'm saying is, there's a sense that we have to get away from the dichotomy, from the old thinking. people are catastrophizing

bullard is offering genuine sense that, you know what? we'll be okay. and i think the "we'll be okay" was lacking in yesterday's decline. yesterday, it's either going to be the end of the world or maybe the end of the world and what he's saying is, look, we're having this kind of move that we get. at one point, he did mention the 70s and i figure you could easily pull that quote and make everybody scared i debated making everybody scared, like a halloween situation, but i can't do it it would be great to pull a quote that made it sound like things were really bad, but those days when i used to cover homicide, they're over >> he did say, look, i'm not a phillips curve guy i think you can tame inflation without real damage to the labor market europe stronger than we thought, china is reopening, u.s. more resilient and the markets may be overstating the possibility of recession. here's what he said. >> markets have overpriced a recession in the second half of 2022 and overpriced a recession

in the first half of 2023. maybe they're overpricing the chances of recession in the second half of 2023. you got china coming on board. you got a stronger europe than we thought it kind of seems like the u.s. economy might be more resilient than markets thought, let's say, six or eight weeks ago >> liesman asked him, what about the 50 that you were interested in last meeting? you may be this time he said, you get to the terminal, you know you're there when the next decision could be up or down that's where he wants to go. >> i think that's good it's in keeping with what powell keeps saying there are many people who own the ten-year who seem to think we'll start cutting before we even are done raising it, which is, of course, oxymoronic. david, there was -- there were some moments when bullard was talking where you got the feeling of, you know what, it's okay to own stocks >> true. although, as one with a keen sense for the obvious, it's also

okay to own the two-year now, and in a way that we never had the conversation for the last decade, i can say to you, you know what? why not just wait it out you can get almost 5%, thank you very much. >> they're not mutually exclusive where i come down. they're not. you can own some of both >> okay. but my point is, does it -- does it temper people's willingness to take risk because you don't have to as much as you did even a couple of years ago when you're, like, well, where els am i possibly going to get a return >> that's what we're pricing in. i mean, i did a show last night where i said, look, until we -- >> particularly, excuse me, without there being real growth, i guess, is my point so you can't point to something in the market that says, well, i need to get in that. >> they're giving a place -- there were some hedge fund managers talking about, you can never hide -- no one ever says you can hide in something, hide in stocks. i'm not talking about hiding hiding in plain sight, perhaps, but there's nothing the matter with getting 5% until we've cleared things up. but if they're going to keep crushing the market as they did yesterday, i'm sorry, i'm going

to -- i have to find things i like you know, they force -- this market forces you to recognize that there are opportunities and by the way, can i just be clear? one of them is not intel >> we're going to get to intel in a moment, and this news on the dividend i really do want to look at the six things you said you need to end the selloff. do you want to go through them the first is the rise in yields got slow >> well, remember, i don't say, stock. the velocity of the increase in rates is what your problem is. and then, we need to see -- the recession stocks are starting to do better. pepsico's doing better, general mills, work was upgraded today i like that. we have to see the bank stocks stabilize, because they have been the sub rows of winners as people realize we're not going to have the false increase i have jamie dimon tomorrow. >> you do? >> yeah. spending a lot of time in philadelphia we're going to philly. >> okay.

that's good. i'm looking forward to that. >> that was called promotion >> yeah. but, when it comes to the banks, capital markets activity is quite muted right now. m&a, as we know, is fairly muted. by the way, bigger for some than others sales and trading, okay. and their customers are now demanding that they actually get paid something for, you know, or see you later. >> credit balance. >> yeah. i don't know it's not the greatest environment. >> that used to be business as usual. >> yeah. >> that's kind of what you had david, i'm indicating that -- and i wrote this one on my checklist -- we need to see stocks in retail that are doing well and not all doing badly i thought the dichotomy between walmart and home depot was one of the most important dichotomies i've seen, because if you're trying to improve your home as u.p.s. always taught us, and there's no home price appreciation, then it's counted as an expense. if you're trying to improve it

and there's house price appreciation, then you have capitalization people seeking capitalization. now, what that means is that if the fed wins and home price appreciation, then you can't buy home depot walmart, totally different walmart is saying, you know what we're not your grandfather's walmart. you can come and find really great bargains millennials, gen z, same thing with america's best, the millennials and gen zs, hard to figure out what they're doing. it turns out they like to save money, and therefore they go to wil walmart. it's almost the age of walmart >> we get a couple of those. i heard you yesterday. >> you did you watched? >> well, it was part of the conversation with carl about walmart, and i thought you were comments were spot on. >> yeah. that's fogood we'll get to tjx in a moment as well jim does mention intel, and the chip maker is cutting its quarterly dividends by almost two-thirds they say it will improve their

ability to execute their transformation amid economic uncertainty. also reaffirming the current quarter guidance, they're going to cut some comp for employees and executives and the board >> you know, they should just get out of the forecast game >> get out of the what >> forecast. >> forecasting >> i have no conviction that their forecasts are right at all. you know, we're not dealing with general mills here david, how many times did this company say that their dividend was safe >> many. many, including very recently. >> yeah. >> with deirdre bosa, where she pushed pat gelsinger >> it's like dustin hoffman in "marathon man." >> is it safe? >> which one is olivier and which one is dustin hoffman? i'm tired of it. i'm tired of it because people at home watch, and they say, oh,

look at that size dividend, and they just reassure it and they slam this guy, cramer, when he suggested the dividend may be in jeopardy i'll buy some intel. why hurt people? why not just say, i don't know there. i don't know >> from a broader perspective, just we sit here every day, as i have for decades now, covering these companies, i mean, the decline of intel as what was once the most blue chip of blue chips, the most add fired companies under andy grove, greg barrett, the leader in the world in chip design, production, and what has happened. take a look at 20 years. there it is. nothing. you know, you've got no real return in the stock market over a 20-year period obviously, the rise of nvidia, the rise of amd. but it is amazing how they lost their way, and where do you sort of come down >> when they hired a sales

person as the ceo, as opposed to andy grove >> and that was -- >> you had a series. >> you want to name names here >> you can end with bob swan if you want to. >> all right >> i don't want to slag anybody. they made a decision that they were going to be in the -- remember, they're in the foundry business, and they continue to be that way, and the other guys can say, listen, we went foundry light. we went to taiwan semi i happen to like the intel model because cherry parker built all these foundries and each one was exactly the same, so you could parachute into israel. what i didn't like about intel was that they lost leadership because they stuck by gordon moore's law, which is about how you get more computing power every couple years, and jensen huang is going to tell you, that is the problem moore's law is not -- when i was, like -- >> they 34missed a cycle, right?

they missed an entire -- and tsmc crushed them. >> they crushed them i remember being out to see jensen huang, and at one point, he just went ballistic about moore's law and how they're blowing away moore's law they're putting together these cards, and that's how you get a super computer, that's how you get to chat, the holy grail of chat, which we'll talk about later with palo alto, but i just think that they lost their way because they were thinking too small. they remind me of switzerland in "the third man. all they have is the clock >> meantime, we're going to see if they're rewarding software names today. >> there was a note today, very positive about nvidia. you don't want to see a positive note on nvidia, because nvidia is a company that is not going to say -- not going to participate in the hype of chat.

that's not their style yes, they do have good a.i they have gaming they had a deal yesterday you didn't even mention. >> i didn't. with microsoft i will -- we'll -- maybe we'll come back to that. i didn't even know, frankly, gaming really nvidia's -- >> i said it for him gaming is what's going to hurt them when they report tonight, because gaming is very pedestrian it's not the kind of, you know -- >> i know they sell into gaming, but they also have this other -- >> this is not -- you know, when you talk about a $5 billion opportunity -- i read a piece last week, david, two weeks ago, $13 billion -- a $13 billion opportunity. well, i see -- how about 14? >> what opportunity are we talking about? >> because you can't just say it's time to buy nvidia, because they have a $13 billion a.i. opportunity. that's not how wall street works. they want to know what's going to happen next quarter not three years from now

so, they're not going to get what they want >> so, you are cautious going into -- >> yeah. my charitable trust, big position in nvidia i named my late dog after nvidia i'm all in, but that doesn't mean the stock deserves to have the move it just had look what happened to all the other a.i. one of the big repeals here of this year was all the a.i. hoopla, the froth, and i don't think that nvidia's going to engage in any of it. they're not -- they're not promotional. they're a real company >> they're real. they're the leader they're -- i mean, the gpu changed -- potentially changed history. >> the gpu is the counter to moore's law. pat gelsinger will say that moore's law will never be repealed, and pat's wrong on that i left out, though, what did i leave out the whole time >> i don't know. >> oh, yes, you do >> gelsinger

>> is? >> a good man. >> thank you >> a nice man. >> thanks a lot. i'm playing "jeopardy!" with you. >> i'm good at that too. >> you know what i have to say about him? got nothing for you. does he have any idea who that is when we come back today, a focus on china we got baidu's quarterly beat and a.i. bot plans to regulators in china sending a message not to use chatgpt later on today, pepsi's ramon laguarta dude it was eight and a half minutes. i didn't even get to finish my burrito. technology lets you vacation in space, but to get work done on earth... you need more than technology. you need cdw. so with the cisco hybrid work environment, we can deliver the same network experience to all your offices. space spaghetti. no. securely connecting your team from anywhere. houston we... have a solution.

we get it greg, you've been to space. cisco makes hybrid work possible. cdw makes it powerful. ♪♪ inner voice (kombucha brewer): if i just stare at these payroll forms... my business' payroll taxes will calculate themselves. right? uhh...nope. intuit quickbooks helps you manage your payroll taxes, cheers! with 100% accurate tax calculations guaranteed. (vo) businesses nationwide are switching to verizon business internet. cheers! (woman) it's a perfect fit for my small business. (vo) verizon has business internet solutions nationwide. (man) for our not-so-small business too. (vo) get internet that keeps your business ready for anything. from verizon.

for businesses of all sizes, there are a lot of choices when it comes to your internet and technology needs. when you choose comcast business internet, you choose the largest, fastest reliable network. you choose advanced security for total peace of mind. and you choose a next generation 10g network that's always improving, getting faster; more reliable; and more intelligent to keep you ready for today and tomorrow. the choice is clear: make your business future ready with the network from the most innovative company. comcast business.

china's baidu up sharply in the premarket, announcing a $5 billion buyback the company plans to integrate its a.i.-powered chat bot into search next month. regulators have instructed chinese tech not to offer chatgpt services on their platform, amid growing alarm over the chat bot's uncensored replies to some queries. also jpmorgan has clamped down on staff use of chatgpt, someone to ask dimon about >> the other day, like, yesterday, palo alto, nikesh, great ceo, great numbers, he was talking about how he thinks it's the most revolutionary thing since the iphone, and i think

that it is so unpoliced that to an autocratic country, to a serious totalitarian regime, david, could there be anything worse than a machine that could think for itself >> it does raise challenges for them without a doubt although the chinese have been extraordinarily successful at censorship >> did you read the two-hour exchange between "the new york times" columnist >> i did, yeah now, bing, microsoft, is trying to limit, although they've raised it a bit. you've only got a group of people who are able to use it. it's not fully available via bing >> it can't be censored. it's got a mind of its own >> that's true that doesn't mean the chinese -- right. i mean, they're going to -- they are developing their own a.i. chat bots. they're obviously -- >> what does that say? >> they're going to have to regulate them very closely what i worry or wonder about, listening to sam altman, for

example, the person behind chatgpt at open a.i. is, you know, he has this vision of a world where you've got, you know, a giant building filled with servers that is trying to solve cancer via a.i >> yeah. >> what's going to stop the chinese from having a giant building filled with the same technology but trying to do something a lot more nefarious >> well, absolutely. that's a big worry that's one of the reasons we're talking about restricting the most important chips, the nvidia chips this whole thing -- we take away the nvidia chips, they won't be able to do that >> at least for a while. >> how about if you're in china, and you ask chatgpt, how many people were killed by mao? i mean, what happens if it says, well, gives a real answer? what a nightmare for the regime. how about the cultural revolution was it good? did a thousand flowers bloom how was the last five-year plan? you're not going to get the kind

of thing that the regime wants >> we're at such early stages here of what is conceivably a revolution that it's hard for us to know anything that's going to happen, including what it will mean to places like china and/or our country as well. >> but we are not going to -- we're not going to censor it we have a supreme court that doesn't even know what it is >> we were laughing about kagan's comments yesterday >> she's dynamite. she had a great couple -- cuan you say a justice is dynamite? >> you can if you want >> she was in my class at law school i sent her a bouquet of flowers when she got in. >> upper west sider. >> chief justice roberts from here as well >> she went to harvard law school, because she went to princeton undergrad. >> yeah, she was friends the -- never mind >> that other guy. they still are friends they still are >> there's no accounting for taste. >> i know a third of their group. >> we're talking about eliot

spitzer. >> oh, very nice that was a good scotus coverage right there. we'll get cramer's "mad dash," countdown to the opening bell. take a look the a tufures as we try to rebound from that drubbing on tuesday. more "squawk on the street" in a minute you'll always remember buying your first car. but the things that last a lifetime like happiness, love and confidence... you can't buy those. but you can invest in them. at t. rowe price, our strategic investing approach can help you build the future you imagine.

we'll chat some palo alto with jim in a few minutes, but it is at the top of the nasdaq 100 gainers this morning as they beat, billings beat, they guide ahead for the quarter and the full year. got a couple price target increases at deutsche and barclay's today. opening bell a few moments away, and don't forget, you can catch us any time, anywhere, just listen to and follow the "squawk on the street: opening bell" podcast.

i think i'm ready for this. heck ya! with e*trade you're ready for anything. marriage. kids. college. kids moving back in after college. ♪ here's to getting financially ready for anything! and here's to being single and ready to mingle. who's ready to cha-cha?! 92% still active? seems high. seriously? it's just a bike. wait. they make a treadmill with an intuitive speed knob? yeah. want to try? 92% stick with it, so can you. start a 30-day home trial today. terms apply.

the opening bell is brought to you by nuveen, a leader in income, alternatives, and responsible investing. >> policy is my top priority for this year. there's a lot of bipartisan

support, i would say, out there for getting comprehensive crypto legislation passed there's a recognition that in the wake of ftx, we need stronger consumer protections. there's also a lot of excitement just about potential of this technology and the -- there's a lot of desire for people to have this built here in america >> all right, that was brian armstrong of coinbase and that gets us to jim's "mad dash," which, as you might imagine, is on that company. >> totally otherworldly conference call, we're basically saying there's a rogue organization it's not coinbase. it's not ftx >> it's the -- >> it's the s.e.c. and s.e.c. right now taking aim at stablecoin. but what really matters to me, david, is that narrative that you just heard, completely off base i mean, the -- it was almost as if, listen, congress really likes what's happening, they're welcoming regulation, but it's the government, the s.e.c. that wants to prosecute -- david,

david, sam bankman-fried, billions of dollars missing, and somehow, they think things are okay better than okay >> well -- >> i mean, it was just -- honestly, i listened, and i said, wow. got to get long coinbase they're the answer no, they're not the answer but you know what? people are going to buy it there's a big short squeeze. the loss is worse. >> trading activity in crypto, particularly by individuals, drives their business, and it was down sharply >> nft is making a comeback, david, did you know what >> i didn't know >> shame on you, partner this was one of those conference calls where i just said, oh, i see, there's a new sheriff in town it's not gary gensler. it's coinbase. they -- i mean, john stark used to be a big regulator, has a nice little mention today in twitter. yes, he's a crypto regulatory

carpet bombing continues next up, stablecoins that's the exact opposite of what coinbase wants. david, i don't know. you can take coinbase, you can take the s.e.c i always say that in the end, the s.e.c. wins. >> thank you >> you're welcome. >> let's get the opening bell here in the cnbc realtime exchange at the big board, health care focused strawberry fields celebrating its uplisting. on the nasdaq, the cast of peacock's wbel air, one more reason to watch peacock, guys. >> yeah. exactly. >> although i know you're watching "the last of us" right now. when you're done with that, move on to "bel air >> yellowstone is on peacock, right? the original one with kevin costner. i'm watching that.

there you go all right? good i get to stay. i get to stay another day. do you watch any peacock >> oh, constantly. >> that's all he does. >> yeah. >> jim, holding 4k here, how important is it at the open? >> look, just tell me what bonds are going to do. i mean, honestly, we were down too much yesterday, but the market doesn't want to go higher the market wants to just kind of bide its time until we know better so right now, interest rates are down a tick, so people get excited. we ought to get away -- we got to go with bullard stop looking at every second, not that that doesn't take the place of us if we did that he didn't say it, like, oh, you don't need to watch those guys, just go do chat. i'm just saying, this is a minuscule decline in interest rates, so then that causes a big increase in stocks no no go watch peacock >> that's not a bad idea, actually one big topic yesterday was why energy was sending a much

different message than bonds you got nat gas with a one handle today, $1.96, oil back to $76, brent's down >> nat gas is defying everything this is back to september of 2020 when the company was at a complete halt and now natural gas, where the country is booming, is below $2 i know it's that fro eeport is closed >> freeport is a lot longer than anticipated. >> you know what the younger people would say it's global warming so we don't need as much natural gas because it's not that cold >> climate change. >> climate change. older people would say, young people are silly >> it has been warm here in the northeast, warmer in europe than they've anticipated. that's been very important >> i thought putin would lose the upper hand >> yes he may be. they have effectively cut off -- europe has cut off russia, right? >> right >> but they're finding over

outlets for their petroleum products >> what do you think about the idea that we could have a 3.5% unemployment, and natural gas, which is the base low, right, remember >> electricity generation. >> nat gas >> that's one reason why morgan stanley, great chart book out this morning, sees real wages going positive next quarter. >> i thought that was huge i agree with that. i mean, when natural gas was at $9, we were talking about the end of the world when it's at two bucks, it's not the beginning of the world this is a fuel that impacts everybody. 33% of the system is based on nat gas. we have nuclear, coal. but natural gas is one of the classics or the backbone of the economy, how we heat, the backbone of the economy, and i just think that this is a decline, which is, inflation, look out this is very positive. but it's not in the stats as much as it should be it's in them >> when you were out last week,

david and i had chuck robbins back >> i thought it was good the stock does nothing what the heck is that about? >> we had analog devices and now we got palo alto are you going to string together a series of decent tech guidance >> i think there's companies that are making a lot of money, and that's the commonality chuck made much more money than expected immediately, they start carping about next -- did he borrow orders from next year? that's nonsense. i'm going to give david a new normal, see if he buys it. david, it's not enough to be nongap profitable. the ceo of palo alto says you got to be gap profitable, and he's gunning to be added to the s&p this spring, and that does matter he's got leadership in 13 different categories we have a bunch of stocks this morning, it's kind of comical, a bunch of cybersecurity companies that are up. they're the ones he's crushing >> right >> what the heck is that about i mean, you want to buy all those companies he's crushing? no and he chided me he chided me for liking some of these other companies.

mostly an opportunity to use the word, "chide," but he's basically saying, jim, if you had -- i love him, but he did say that he's taking share from a lot of companies look at that stock, will you >> yeah. >> he brought back a huge amount of stock, by the way, in the 130s one of the most extraordinary things -- this guy bought back $250 million worth of stock because he thought the stock was too cheap. guess what he was right >> he was. there's a longer term look, and you can see the move the stock has had. >> he had a $40 million deal >> you talked to him last night on "mad," right? >> that was what i was getting at >> let's take a listen to what he had to say about possible consolidation. take a listen. >> security, if you want to lead, you have to constantly innovate, and many of the consolidation opportunities you're seeing are legacy technologies, which have not kept pace with the market, hence you're seeing them suffer at

their top line or their margins, and that's not a good look for us we are better off innovating, creating best of breed products in the market, delivering them using cloud and a.i. and going out and taking share from those people who have legacy products. for us, going out and consolidating legacy markets is not what is interesting. >> yeah, well, look, a lot of people keep thinking this industry has so many players he's saying the opposite we're going to destroy every competitor and i thought that was very forward thinking and tough, and don't forget, david, he has $6 billion in cash he's using his balance sheet to be able to get and keep business the other guys don't have that balance sheet. he's up against companies that are poorly capitalized and they are saying, wow, woe is me, macroeconomic, therefore people aren't taking cybersecurity. he's saying, you need it buy now, pay later, except for you have to pay, as opposed to the current system >> understood. >> they had buy now, pay later

when i was at walmart. and apparently people pay. i think that's the difference. >> well, on palo alto, i think your key point is, don't necessarily buy those that are lo losing market share to palo alto >> and you have a keen eye for the obvious. >> i do. i pride myself on that sense >> well, i mean, carl, to shift away from mike for a second -- i lasted i think that when you have someone like nikesh and you have someone like chuck robbins and you have the analog people, what you say is there are winners and losers, and that's what i'm looking for. i don't want it so that everything goes up because they have chatgpt and tom seibel says, hey, listen, the future is bright what i want are companies that are actually making money and doing that >> i will say, intel, strangely, is a winner today. the stock is up almost 2%. >> the top dow component >> everybody knew.

you can telegraph it go buy it. if people want to go buy it, be my guest good good you know how about waiting for nvidia to not do what people want and buying nvidia? >> well, nvidia's also up this -- in the early trade year. >> so is salesforce. i don't have anything on that. >> what about yesterday, jim, morgan stanley, "we believe we're approaching the bottom of the pc market, which is historically buying opportunity for pc stocks. i know it's not kd huberty anymore. >> you're looking for 17%. we were looking for a 10% decline in the fourth quarter and it turned out to be 17%. at 30%, i don't know how much lower it can go. 30% just basically means that no one's going to buy a pc, other than people who slam the keyboard many times with a phone. >> right but i think that's what david's saying david encut, trough -- >> worst is over i like that david's "worst is over" analysis but i've got better ones to buy,

mainly advanced micra, where -- >> gee, that's shocking. you're recommending advanced micro. okay >> i'm -- >> i'm aware i know >> oh, but jim, you liked it at $170 i'm a triple schizophrenic >> i have not done that to you >> not lately. >> no. >> the burt reynolds to jim's dom. >> one of the greatest moments, but people don't remember anything anymore >> they don't remember anything enemy, but now they have chatgpt to remind them of things that are not really true but that they think happened. >> is the regime a favorable one that lets me read books that i want to? >> no. >> no. no, you cannot read in china, books that you want to, necessarily. guys, a few things on my radar this morning you may have seen news corp. saying, yeah, we're no longer in talks to sell our real estate business move to costar. remember that had -- it was a deal that i'm told was very

close, and didn't get to the finish line. unclear whether it might come back at some point, but both companies basically said, especially costar, they reported earnings that were fine, guidance that was not, and they indicated they're no longer in those talks about that by the way, when it comes to their guidance, ebitda, outlook, materially below expectations, driven by a significant step up in investment in the residential opportunity, looking at a note here from j&p, which continues to sort of like the stock for a number of reasons, they say, including the commercial business and a number of other areas, but that's why that stock is down. it's the guidance from the company, step-up in investment and residential opportunity they see. deal with news corp., the buy move no longer in process at all. news corp. shares are also down, jim, at this point remember, they're no longer trying to get together again with their -- with fox, both murdoch-controlled companies >> you have to go to baidu to see advertising.

>> yeah. >> but that's clear across >> yeah, baidu, online marketing revenue down six it's actually widening from the prior quarter, when it was down four, but they had a pretty good topline number $5 billion buyback tjx, we haven't done, jim. comps up four on better traffic, but they, again, like many, guiding below for the quarter. >> now, they have a history of doing that that's what i said yesterday in our morning meeting for those who are members of the investing club they don't have to do the conference call until 11:00. their history is to be very conservative in the statement and then come out swinging in the conference ball. the one thing i did see that they were honest about is that pilferage has become a real problem. >> what has? >> pilferage stealing shrinkage. >> pilferage that's what they used to call it, shrinking. >> they were at least honest enough to come out and say it's

a problem. i've been waiting for the drugstores to do it. i was questioning walmart the other day about -- they have very little that's under lock and key. they have a policy of checking on the way out but that was -- they finally highlighted it it was not expected. it's causing -- it's one of the reasons the stock is down, but same-store sales were sharply better than expected, so what will happen is on the conference call, they will talk about same-store sales being better than expected, de-emphasize shrinkage, and you'll realize that you should have bought, not sold it. >> tjx, relatively quiet company, not going to see the ceo, they communicate through the conference call, about a $90 billion market value, well more than target's it's an enormous retailer. >> target, of course, prints tuesday. >> yes >> and a story today, melissa, nice piece on a new investment to improve supply chain networking, $100 million >> yeah, well, look, supply chain, we keep hearing -- i got to tell you, the supply chain

was very good at walmart but i just think that everyone's trying to compete with the ultimate supply chain they have at amazon, and david, i know amazon didn't want to come back to work full-time. >> speaking of amazon, i did want to mention they closed the one medical deal >> what do you think of that >> well, it's funny, because yesterday, there was word -- there's an analyst who's followed this quite closely from a firm called market -- i think it's market securities french brokerage anyway, she's been followed -- she's been negative on the ftc response and then changed her view on friday number of people got wind of that, and in fact, it ended up being correct. the ftc didn't challenge, at least in the window -- really, i said they certified, they'd sort of met all the second request needs last week or week prior, and it's done. amazon's bought it 18 bucks a share and so, it does -- now you move

on to irobot, and you say, will they try to challenge there? but it's not an insignificant moment it's not an enormous company, but there had been an expectation that you might very well see one medical that's halted because it's done. it's over. it's no longer a public company. so, don't take that -- yeah, don't take that price. >> they failed in a lot of -- >> the question is, what it means, jim and carl, for the larger regulatory perspective from the ftc, which as we know, has been extremely aggressive, far more than people think is allowed by law in terms of things that it may challenge this is what a spokesman said. but basically, again, they're saying it's continuing, but they're not doing anything >> this could lead to lower prices, and i think the ftc justifiably said, anything that leads to lower prices for health care is pretty good. they have a rationale. >> you got the two cvs deals still out there. signify and the other one, i-robot out there.

>> the holy grail is to be able to get all your medicines via one entity where they come to your house and this makes it more likely. this could be a fulfillment center for medicines, the same way that walmart's a fulfillment center by brick and mortar i don't know i like it very much. i was surprised, but i think that i wasn't calculating the idea that the ftc would say, wait a second, if we can get health down -- >> one medical was trading a significant spread until very recently, again, moving up in part on those analyst comments, but signify and osh, both cvs deals, have not had a huge spread and then there's i-robot, which has an enormous spread >> maybe that's one of those like what happened with -- do you remember the deal that the chinese didn't allow it to happen, company used it to get out of to deal dupont >> yes >> if i were andy jassy, i'd be hoping the ftc says --

>> speaking of stocks going higher, is it peak supply chain normalization to see la-z-boy a a one-year high. >> you're looking for data points about lead times, and over and over again, you hear that's the bright spot is that lead times have come down. but you have to hope is that there are still buyers of your product. la-z-boy is interesting. we haven't seen a lot of good news involving people putting stuff in houses. pottery barn did you get that last note this morning about 50% off? >> no. >> should i nard forward it to ? it's a joke. i'm saying -- >> guys, a quick update -- what? what are you saying? >> i'm saying if you're whirlpool, they had supply

chains go down a lot, and sales weren't as strong. there's a foot race. costs come down, but you got to hope the sales go higher >> got it. >> that's the key. david. >> guys, just on the front of keeping people up on unsolicited situations we're following national instruments emerson came after this company. 53 just a quick update. some of this was shared yesterday in various conferences, but emerson obviously in hot pursuit clearly made the case publicly now as well. we told you as well that 60 is not going to be a number first round bids due, end of this week. next four to six weeks, second round. i'm hearing honeywell, no longer there. fortive is the name that comes up >> fortive >> yeah. that could be a structured transaction, given the size, but private equity might be willing to do that we'll keep an eye on national instruments. it does seem to be a process

>> my travel trust owns it i was very upset with emerson doing a hostile. it's very unlike the old emerson. i'm saying, could you please buy somebody who wants to be bought? >> it may be that they now want to be bought or at least are certainly happy to consider being bought at a price that is -- >> but emerson's got a price, but that doesn't mean anything emerson's stock is being killed by this. >> the question is, where they end up and whether that's enough for an ati we don't know whether fortive will be able to put something together, but it doesn't appear there's going to be a lot of competition. if they go to $55, does nati say, no? >> if they get below $55 -- right now, emerson's a disaster. this was supposed to be a done deal look at that stock >> they tried. they tried, and they tried >> a longer term is going to be better longer term.

we know what happens longer term >> as we go to break, watch bonds today. we got bullard on "squawk" under our belts, and we'll watch for fed minutes this afternoon, try to see what the commentary was relative to the powell presser, which you remember well. yields for the time being, right around 3.9 % williams speaks at 5:30 today. be right back.

holding s&p 4k to start this wednesday morning. got the nasdaq up about half a percent. good bredth as we one wind this morning. lower are utilities, health care and some financials as well. we'll get stock trading with jim in a minute. what's up my trade dogs? you should be listening to me. you want to be rich like me? you want to trust me on this one.

[inaudible] wow! yeah! it's time to take control of your investing education. cut through the noise with best-in-class education resources that match your preferred style of learning. learn your way. not theirs. td ameritrade. where smart investors get smarter℠.

it's time for jim to stop trading. >> we talked about supply chain problems and one place there's a problem is charles river labs i know them as 1-800 hp lab-rats but sure enough the justice department has an investigation

into supply chains involving monkeys. i need to know more about this, those that feel -- this is going to kill the stock. >> it is -- it's the kind of raw material in a sense. right? >> i know. i hate thinking of that. >> but anyway, i need to know more because it's crushing them, even though they're a good company. >> walk us through tonight. >> i have waters tonight, i have federal realty, we'll talk about bed, bath and beyond and i have crocs the u.s. is slowing down going to philadelphia, they're opening a new branch in a neighborhood in philadelphia an unbanked area. and jamie dimon is going to open it, i'll interview jamie on halftime and also for "mad money" i'll tell jamie you said hi,

david. >> thank you >> you will not be here tomorrow morning? you'll be in philadelphia. >> by satellite i'll come from peacock. >> okay. >> the mother ship. >> from the mothership thank you. i have to tell you, i'm not -- you have to watch this coin base i know i was talking to chase nancy, our producer for the hour i think it's important what's happening. chase does not agree because her mom would never buy bitcoin. >> we should have a segment where producers sound off. >> like estee lauder, friday the asis -- assistants are the bosses >> we are trying to recoupe losses from yesterday, dow up 52, s&p 4,005. go production. go faster and safer. emerson automation software helps breakthrough medicines get to market at warp speed. go human go. go boldly. emerson.

♪♪ for skin as alive as you are... don't settle for silver. harness the power of 7 moisturizers & 3 vitamins to smooth, heal, and moisturize your dry skin. gold bond. champion your skin. dad, we got this. we got this. we got this. we got this. we got this. yay! we got this. we got this! life is for living. we got this! let's partner for all of it. edward jones

this thing, it's making me get an ice bath again. what do you mean? these straps are mind-blowing! they collect hundreds of data points like hrv and rem sleep, so you know all you need for recovery. and you are? i'm an investor...in invesco qqq,

a fund that gives me access to... nasdaq 100 innovations like... wearable training optimization tech. uh, how long are you... i'm done. i'm okay. good wednesday morning and welcome to another hour here on "squawk on the street. i'm sara eisen, here with carl quintanilla and david faber. we are live at the new york stock exchange calmer out there after

yesterday's selloff, worst of the year after yields shot to the highest level since 2008 we have the release from the last fed meeting and stocks are a little bit firmer ahead of that, after weakness overseas. about 30 minutes into the trading session. three big movers to tell you about that we're watching. palo alto networks getting a boost after toppings estimates, revenue growing by 26% to $1.7 billion the stock is up 30% so far this year already look at coin base getting a pop after posting a smaller than expected loss. subscription and service revenue offsetting quarter over quarter declines in trading volumes. we have more on that later this hour shares of toll brothers rising saying we believe the recent pick up in demand is a sign that long term fundamentals underpinning the housing market remain intact. stock is up 4% overall the major averages

coming off the worst day of the year trying to rebound in today's trade. jim bullard speaking this morning to address concerns around higher rates. listen to what he said >> we still haven't gotten to the point where the committee put the so-called terminal rate -- i don't think you should call it a terminal rate. but get to that level and people your way around and see what you need to do. >> i've said that the 5 and 3/8 would be a good number to shoot for. i think that would be good for the current situation and from there we can react to the data, i don't know what's going to happen in the second half. i think that markets have overpriced a recession in the second half of 2022 and overpriced a recession in the first half of 2023 maybe they're overpricing the chances of recession in the second half of 2023. you have china coming on board, a stronger europe than we thought. it kind of seems like the u.s. economy might be more resilient

than markets thought let's say six or eight weeks ago >> two weeks ago, guys, i think that bullard saying a terminal rate of 5.3% would have spooked the market today, market is shrugging it off. because there's been a significant repricing of where the federal funds rate is going to go at the terminal or peak rate it was 4.9% a week ago, and now we're almost 4% by june, the stronger data doing the work for the fed as usual and that's what yesterday's selloff was all about playing catch up to the bond market. >> we've seen it, people ra ratcheting up the terminal rate. and how long we're going to be there is a debate area it wasn't long ago everyone was talking about rate cuts in the second half of the year. >> getting priced out, the fed shot that down, market didn't believe them and now the data is doing the work saying it's going

to be tougher than maybe the market expected to get inflation down and cool down this economy. seeing it in spots like retail sales. seeing it even walmart and home depot which offered cautious guidance on the consumer, did not paint a picture of recession, plenty of indicators to show things are going well. the most important one is jobs no weakness there. very little weakness there in the strength and wages that's part of the problem for the markets and the fed, even though it's good news for americans. >> having bullard say all right, 5 p, 3, 7, 5 is nicer than 5 to 7 which was his view in november when he talked about that -- >> he's all over the map. >> i know. he's been not close to the center, also interesting to hear him say, asked about the lags and monetary policy, market prices these things in quicker than by the time we make the move and to hear him say the layoffs in silicon valley have no bearing on the overall job

market. >> which is true we've seen that. we wait every week to see it come up in the jobless claims and the number has gone south. fewer americans filing for unemployment claims, below 200,000 as of last week. it hasn't shown up, which shows you the strength in the labor market as a whole. look, remember the last fed meeting when powell sort of gave the green light on financial conditions he didn't play them down he didn't say, no, we need to see more pain or we have a problem with financial conditions financial conditions impact the economy. and i think toll brothers was a good indication of that. in other words we have seen rates come down -- >> yes. >> mortgage rates have come down from 7% why? everyone thinks the fed is going to pause now the housing market is in better shape we heard from the toll brothers ceo, since the start of the calendar year we've seen a marked increase in demand beyond normal seasonality as buyer confidence seems to be improving

we believe the recent pick up in demand is a sign that long term fundamentals under pinning is intact but i believe it's the mortgage rates coming down. >> mortgage apps today, the lowest volume since "95. i think the fed is doing their work in terms of interest rate sensitive sectors. >> what about wage inflation isn't that still -- to your point about a tight job market, isn't that the number one focus perhaps or no? >> it's a huge focus for the fed. >> we have to have moderation. it's not like it remains at high levels consumers are getting paid, there's a worry that demand is going to fuel inflation. inflation expectations are in check. a lot of good things going for the fed, but i think wages, absolutely will be key we heard commentary that the labor market has loosened a

little bit we were talking yesterday about walmart's ceo saying it's easier to hire associates. >> morgan stanley has a fresh chart, it goes to 170, 140, 110, 90, 70, 60, 50, ending at 50k a month in late summer their view was clearly january was not reflective of the market. >> we see that, wage pressures or price pressures should come down everyone thought we would be seeing that as of january and we saw the opposite david rosenberg says it's seasonality. warm weather there was someone off factors and that's why the fed is going to have to wait and see. i think the minutes will be interesting, kind of old obviously because we have a lot of new hot data since the last fed meeting. but people want to see how close they were to moving to a pause and the economic data. >> just tweeted, the largest --

or the biggest wage gain in 3q, want to guess? >> in county >> the biggest wage gain, midland texas. >> i was going to say florida or texas. >> 13.9 midland texas. >> they need workers in the energy pits and people are hiring, moving there i wonder the difference between there and new york city and l.a. let's continue the conversation on the market we're off the highs at least of the session a half hour or so into trading coming off a poor day yesterday, at least if you were long. let's get to mike santoli and find out what he's thinking about. >> david, continuing to try to absorb all the things you're talking about, particularly on the yield side look at the one-year treasury bill yield this essentially captures all that is now expected from the fed over the next 12 months you see the liftoff here since the hot jobs report we got about a

month ago. right now think about it 505 for the one year presumably that gets you beyond what where the fed is going to peak it out it gets to 5 and 3 3/8th it means the market is going to peak out. and it feels like if that's what we have to price ultimately we can probably make piece with it with val uvaluations adjustments toll brothers with the reset lower in mortgage rates overall home builder related stock, this is two year relative to the s&p. see outperformance over the period and you see the strong move off the october low so the market is on board with the idea it won't take a lot to rebuild demand in the home building sector although we get tested again, mortgage rates shooting back up, so we'll see how sensitive we are to that volatility index getting

slightly interesting again on a two-year chart you see the shift from bull market patterns where you're bottoming out around 15 when the fed plan is perfectly priced and basically not happening at all in terms of fed tightening to choppy tightening, bear market, 25% market drop. you see the little rebuild above that 18, 19 level where we bottomed out and we'll see where it goes from here. topped in the mid 30s. so this looks a lot in a sense like the december move there, we did have that mid december drop of 2% or so in the s&p 500 on one day, very much like yesterday after a period of sideways so we'll see if we're in another reset mode here, on alert for what the fed has to say and whether we can avert the too hot or cold scenarios. >> we have earnings, and guidance uncertain what's the 12-month outlook on earnings >> it's been sliding down to around 220, s&p 500

earnings projected at the moment and it's been coming down throughout the first quarter reporting season if you said earnings estimates are way too high coming into this year. that was the consensus take. it's been true and margins have been compressed as everybody said but the market says yes, we understood that was going to be happening. so it hasn't created necessarily a shock. it's been much more i think just a general under tone in certain sectors that dragged us down it hasn't helped valuations which remain relatively elevated versus history on the s&p basis. >> mike, thank you today is a defensive tone, staples and utilities leading the market here's the road map for the rest of the hour china's versus chat bot. instructing companies to not offer chat gpt services. lucid is one of the nasdaq 100's top performers this

morning although i have it up nothing. but it's gearing up to report earnings today get ready for it. >> na gas rebounding we'll talk with aanyst n alwho believes it's near the bottom when "squawk on the street" comes back the hiring process used to be the death of me. but with upwork... with upwork the hiring process is fast and flexible. behold... all that talent! ♪ this is how we work now ♪

tech stocks are under pressure, generally speaking you can see that as well, regulators apparently telling some companies not to offer chat gpt services amidst

growing alarm in the chinese government over uncensored replies. ben harberg joins us now from beijing. good to have you, ben, to check in on a myriad of issues, there always are with china. i have you saying there's a lot of capital still sitting on the fence waiting for policy actions behind what has been some positive rhetoric when it comes to regulation or the tech industry but what would you be looking for in terms of actual policy actions that's going to get the capital off the fence, so to speak? >> we have the national people's congress coming up in mark that will be one of the key mile stones they set out a growth target for the year and answer the how questions rather than just the what. and so, obviously, what we're looking for are sustained support of the private sector some of the roll backs in the regulatory measures. an opening of the public markets domestically and those channels that purportedly will be opened

starting in march when companies in china try to go public overseas and just overall sustained sport of entrepreneurship >> with that you expect as well we'll see a lot of money in infrastructure coming -- or from infrastructure >> the chinese government has no choice but to stimulate growth all the regional governments around the market that were previously tasked with maintaining covid zero are told grow at all costs a lot of that comes by way of infrastructure spending and having come out of a track 2 event just a few days ago, the word on the street is it should be a 7% growth year around china as a result of that stimulus >> you've actually got an i.p.o. coming from one of your portfolio companies right here is that a sign of things to come in there was a period where it was every day there was a chinese company coming public at the nyc.

i can't remember the last time we've seen one. >> there haven't been a lot of american companies going public there either. >> that's a good point. >> certainly since the i.p.o. that fell off a cliff, that channel now with the public accounting oversight folks from the s.e.c. feeling more comfortable with chinese audits appears to be reopened that threads delisting off the table now. and now those are reopen, the publishing guidelines that go in effect march 31st around the chinese companies going public in the u.s. >> what about the regulatory crackdown which has been a headwind for these stocks and hard to read the official commentaries and signals on this are they uncracking right now? >> the tone is certainly softened of course out of the central party work conference we heard no mention of the regulatory interventions

no mention of common prosperity and the other buzzwords that have squared away western investors. again i think the chinese recognize -- we saw a clear policy shift from the end of december onward that was domestic policy, health care policy, foreign policy from that point onward growth had to be the focal point of anything done in the market and anything that scares away western investors like regulatory, has to be softened and rolled back. >> morgan stanley has a chart looking at what they're calling the worry free chinese consumer one that expresses growing optimism about the macro they say private consumption could grow by 9% plus. i wonder if you think that's likely given what we know about youth unemployment in china? >> it's tough to find a job in china, but certainly there was a huge amount of capital sitting on the sidelines in terms of discretionary spending over the last two, three quarters in

china where smes didn't know where their next paychecks would come from. people were afraid of going to malls worried about getting caught in a quarantine or outbreak we saw record high levels during the chinese new year's with record 2018, 2019 figures. i think there's going to be spending coming back into the market, that's what they're projecting and all systems seem to be go from our viewpoint as we walk the streets of beijing >> ben, you mention, obviously, a number of potential positives for chinese companies during the course of the last few minutes but i wonder with a backdrop of so much risk, for example, if the chinese were to begin arming the russians, perhaps unlikely but if that happens with, you can imagine a series of things the u.s. would do that would be bad for the world economy not to mention china. how do you manage that risk given the heightened tensions

between our two countries? >> certainly the united states has put in place now a regulatory regime that enables it to take significant action against the chinese were they to get involved in taiwan or take actions that would arm the russians for us, it's -- we believe it to be a very low likelihood, the chinese today have toed the line on sanctions and it's grow at all cost right now anything that could retard that growth would bring to the streets like we saw at the end of 2022. americans have put in place such an ironclad framework to prevent against that so we're betting that won't happen. >> finally we're talking about chat gpt in general and ai, some reports we cited about crackdowns perhaps by the chinese because you can get past censorship what's your sense of the growth

of ai in china's technology industry and the importance that it has >> for a long time, obviously, we said that china has somewhat of an edge on ai because of the huge concentrated data sets that it has access to and that ai is what has trained the algorithms that have gotten americans so addicted to tiktok, consumers addicted to purchasing game fied commerce products so that is already being commercialized in the daily lives of most americans and within china whether or not china is able to produce a chat gpt replica, trying with the ernie bot, i think is still up to question because of the lack of overall diversification within the ai development space. america has access to the brightest minds across the planet china is depending on domestic

talent for it. i don't see them linking up because they fear their data would be in american r repositories and they don't want that. >> thank you. meta today, a report the company plans to cut thousands of more jobs, deputizing hr and executivesto, in the washingto posts words, denflate the company's hierarchy. it comes after zuckerberg told employees he didn't anticipate any more when they cut 11,000 or 13%. but we have seen, in the initial case, the stock respond positively to any reduction in head count. >> surprised the stock isn't up more the market loved it when meta started its year of efficiency how many times did he say it.

>> 33 times i think. >> it continues with more cuts we've seen signs with the flattening where marny lavene left and is being replaced by long-time executives but cutting out that layer now they report to the coo so clearly there's a shift at facebook, metal. when a big company like this does it you wonder how many other smaller tech companies are right behind in terms of a next wave of cuts >> right although they were spending a number that had rarely, if ever, been seen in corporate america in terms of not just cap x but r&d and everything else. >> so they needed it more. >> perhaps. >> as we head to break, look at stellantis quarterly results topped estimates. those executives noted ongoing supply chain and semiconductor and announcing a buyback program. market likes it up 3.66%

the dow is up 23ois. pnt ions ♪ interesting piece. let me bring in my expert. mmm so many scratches... oh those are from my car keys. -such a rich history. -yeah. this won't do well at auction. but at at&t, it's worth a brand-new samsung galaxy s23. -wait really? -mmhmm. what about this? at&t's deal is back. -wow. everyone gets a free new samsung galaxy s23 with a galaxy phone trade-in. any year, any condition. if your business kept on employees through the pandemic, getrefunds.com can see if it may qualify for a payroll tax refund of up to $26,000 per employee. all it takes is eight minutes to get started. then work with professionals to assist your business with its forms and submit the application. go to getrefunds.com to learn more.

the first time you connected your website and your store was also the first time you realized... we can do anything. cheesecake cookies? [together] the chookie! manage all your sales from one place with a partner that always puts you first. godaddy. tools and support for every small business first.

coin base swinging to a loss for the quarter after trading volume fell a whopping 73% from last year. let's get to kate rooney the market liked it originally the stock was up 4% and the gains have evaporated. along with the market. what did you see >> it's moving overnight a lot trading dried up last quarter as invests fled the crypto assets and bankruptcies left a stain on the industry the quarter was better than feared and executives look to paint a rosier picture about the future of coin base. in the near term it's tied to how much people are trading crypto currencies. transaction revenues made up more than half the total it's losing money on the bottom line trading volume was down 73% from a year ago retail volumes down with an 89%

drop that tends to be more lucrative than the institutional trading side which made up volume last quarter. coin base said the current quarter is seeing a rebound. revenue up 33% thanks to a boost from higher rates. brian armstrong did make the case this is a long term play, all about the crypto economy he says the markets tend to swing and we're in a despair phase. there was mixed reaction from analysts this morning. you had bank of america among those that were underwhelmed by the results saying there's nothing thesis changing in the print. others upbeat about the cost discipline operating expenses down 25%. and coin base expects earnings to improve in 2023 regardless of the crypto backdrop and markets.

executives said trading fees are not compressing yet. that's the bear case for coin base new risks on the table coin base talked about a potential lawsuit with the s.e.c. carl, back to you. >> a quick reminder to check out more crypto coverage at cnbc.com/cryptoworld still ahead more on the markets with a long-time bull, tom lee. why tom says a rally is still in the cards as it dips slightly. stay with us

i'm frank holland with your cnbc news update the city of awe claire, wisconsin is forecasting as much as 20 inches of snow as the

national weather service describes itsz move across the country, 1,000 flights have been canceled today president biden was asked about president putin's suspension of the nuclear arms treaty biden's response, he made a mistake. in moscowmeeting with china's top diplomat they talked about strengthening cooperation between china and russia a little over an hour into trading here we have turned around on the markets. you can see we had opened higher but are down now somewhat. let's get to bob to get the latest >> people cautious normally lower bond yields would mean lower stock prices. it started out that way but we've gone back to selling the rallies now. that's a little bit of a red flag for the bulls, obviously. look at consumer discretionary that was the group that got hit badly yesterday. home depot was a disappointment. there is a modest bounce

mohawk got hit hard, a lot of housing related consumer discretionary. there is a bounce back but it' fairly modest. another group hit hard was the home builders they're bouncing back today a little bit. but toll brothers had a good earnings report. that's a high end builder it's not necessarily representative of the rest of the industry overall, their report was excellent. expect the high end to continue to hold up well. if you look at other consumer discretionaries, no bounce back in the autos, for example, gm and ford and advanced autoparts all down big yesterday doing nothing today. so that has people chatting about a little pause here in the markets. as for intel's dividend. i can't emphasize how unusual this is. this was a really big cut to 12.5 cents it was 37 cents it's a 66% cut that's a lot of

money shareholders aren't getting. intel was $50 a year ago it's essentially been cut in half a sense of how rare these big dividend cuts are. in the s&p 500, the last year ending in january, only five decreases. there's been 384 increases some companies increased their dividend more than once, that's counted here but dividend decreases are rare. i want to give you an idea, not only is it rare but the size, the dollar size is extraordinary. they cut about $4 billion. so holders of intel are not going to get about $4 billion they got last year is that a little, is that a lot? i'll give you an idea here the total dividend payout for the s&p last year, it's about $520 billion so everybody got about $520 billion who held the entire s&p 500 last year. so intel's cut of $4 billion reduces the dividend for the s&p

500, the overall payout by 0.7%. this is an enormous decrease essentially. and companies don't want to do this because you're admitting you have a cash flow problem so right now, sara, i think most people i talk to are treating this as an intel specific issue because we're not seeing the companies cutting the dividends, at least not yet back to you. >> makes sense given the troubles we've seen with intel here to help us break down the action, long time bull arguing a tough fed doesn't mean stocks need to fall every hint of inflation data point. tom lee joins us here at post 9. i invoked your name yesterday saying the bullish tom lee saying the january rally borrowed from february you're expegtexpecting a tough, few weeks? what's your time frame. >> investors should expect a pay

back, one of the toughest januarys if we look at the 7 years that mirror, it's tough in the second half of february to early march. it doesn't mean the full year. there's no thesis change this year is going to be a story about how inflation cooling makes the fed data dependent, not data reactive. that means volatility is expected to fall for yields and equity that's why stocks can rally. >> i'll play devils advocate on the inflation thing. the market is focused on inflation because the fed is focused on inflation and the fed is not coop vinced we've seen a sustainable decrease in the inflation rate why wouldn't the market sell off every time there's evidence that inflation is harder to squash? >> i think that's kind of what happened the last couple weeks, everyone saw january data a little hotter and think the fed is going to jump on that prior to that, keep in mind we had three good inflation prints. powell invoked the word

disininflation 13 times in his press comments if we see that in the -- >> it's old news since then we have seen evidence that it might not be so disinflationary. >> the economy doesn't pivot people say inflation is flaring up, assuming the economy hinges on a match stick i think there were a lot of january seasonals affecting that and gasoline is already rolling over if natural gas is tanking, carl pointed out lithium is tanking both sides of the inflation story, and 60% of the core is deflated. >> shelter lags the most. >> yes. >> if that really does, say, react with a 12-month lag this summer is going to be -- disinflation without it, what's disinflation like with it? >> say the 60% of core is zero or negative, including housing going negative you can't get 2% inflation with

the other 40%. so i think you might be printing 2% inflation starting in the summer >> you made the point that a tough fed doesn't mean the stocks have to go down with every inflation, data point. point back to arthur burns i think. a transition like we're in the midst of from the zero bounds to wherever we end up at a terminal rate is there anything that -- can you really make that connection to the period in the '70s? >> we just published a piece on this if you look at the 14 rate cycles that last more than 12 months 11 of the 14 markets rallied into highs with the hikes. two exceptions were during burns, when he was hire in a hurry. once volker became fed chair, hikes were associated with higher stock prices and green span there were five cycles of his raising, five markets marched higher to all-time

highs. unless powell is invoking burns, i think the stock market is going to appreciate data dependency i know people talk about risk premium as an all-time low but that's because it's at an all-time high. >> unless we have a deeper economic recession or any economic recession, right. then an earnings recession which a lot of folks say has not priced in. >> that's right. the recession calls started last january. so investors kind of -- even ceos priced in a recession last year saw it in the earnings calls so if a slow down happens, a lot of it has been positioned. i don't know if you call it a rolling recession or no landing but i think a lot of bad news is priced in. >> getting beat up by your clients? >> every day. >> every day >> every day i think the good news is that market internals are forcefully

arguing our view that markets will make an all-time high this year mark has written a lot about it. if you -- here's an interesting stat on january 12, 2023, something happened that has never happened in 70 years of market history. you had three measures of market become five standard deviations. you had a breakaway moment move, a breath thrust and three days of consecutive up volume and you know, the last eight times that were close, the markets were higher 12 of 12 times. that's why the internals are arguing 20% gains. >> a whaley breath thrust. >> yes technicians are creative >> even sara didn't know that. >> i did not thank you. learned something. tom lee. get a check on the top gainers. palo alto going to lead you along with other names with

earnings this week and amazon as well up 2%. s&p is down 10 points. back after the break for skin ase as you are... don't settle for silver. harness the power of 7 moisturizers & 3 vitamins to smooth, heal, and moisturize your dry skin. gold bond. champion your skin.

i have to admit that it's one of our smaller brands, bit surprised david is a consumer, but thank you for that it's a great product i wouldn't say it has shrunk in recent years i know that there was a period, a while ago that mallomars were bigger and then we reduced them not because of cost reasons but more portion size reason he's probably referring to that. but he should be reassured we're not going to reduce the size of mallomars. >> i can't believe you spent time in an interview on my cookie, thank you. >> i care about you and your cravings and i think

shrinkflation trying t save on cost, it's in that vain. >> yes chips ahow, i eat a lot of their products but they do make them smaller. >> he said they made them smaller once >> it's been a few years. >> and confirmed what i said, it's a niche product >> i don't think it's niche, i think it's mass market. >> it's piled up on the shelves. it goes quick. >> it's very northeast. >> maybe northeast it's a temperature thing, they don't have them in the summer and warmer weather climates they don't have them at all. >> are there any lays snacks you would like me to ask about >> i'm more of a sweet tooth than salty. >> i'm salty >> we are going to talk to a mon laguarta today >> i have two boxes in the

cabinet. >> you have to bring them in now. >> i have to bring them in. >> i don't know that i ever had one. >> you will. >> it's crazy. let's get to dominic chu. >> the best is the pure chocolate with graham cracker. i'm dominic chu we are talking about sectors in stocks trading near the flat line today a couple notable movers in the health care sectors specifically that includes names like lab corp. extending yesterday's declines after price targets were cut yesterday those shares down 2.5% charles rivers tracking for the worst day since 2020 after they issued down beat giants and is d disclosed a justice department subpoena related to sourcing of monkeys. so watch those there's more coming up on "squawk on thetrt. ayertay with us.

we'll be back after this commercial break

i think i'm ready for this. heck ya! with e*trade you're ready for anything. marriage. kids. college. kids moving back in after college. ♪ finally we can eat. ♪ you know you make me wanna...♪ and then we looked around and said, wait a minute, this isn't even our stroller! (laughing) you live with your parents, but you own a house in the metaverse? mhm. cool...i don't get it. here's to getting financially ready for anything! and here's to being single and ready to mingle. who's ready to cha-cha?! ♪ yeah, yeah ♪

welcome back to "squawk on the street." oil prices falling for a third session on some of these fuel

demand concerns. watching gnat gas today, francisco joins us to discuss. nat gas, most oversold in seven years. is it close to a bottom? >> carl, yes we think it's close to a we this close to a bottom. obviously, we have had a very warm winter. we've also had a lot of wind generation and also, on top of that, remember, we have freeport gas looked up in the u.s that's two bcf a day for seven to eight months. that's about 400 to 500 bcf that we get out of the system so we have had the weather going against demand so i think we're getting close to the bottom for gas. >> all right overall, on energy, i saw one firm today raise their demand forecast for the year by quite a bit. largely pinned to china. is that the mode you're in right now? >> yeah, i mean, look, i think china is going to be driving

demand for oil emerging markets generally into the next 18 months but it's been a little slower than we expected so far. remember, the first couple of months after the china reopening, we have had a big spike in covid cases, which i think has led to people just locking themselves up, rather than government driven but what we hear is that passport issuance and all of that fun stuff is a little slow. and of course, as we know, u.s./china flights are still running extremely low. i think there are about 12 flights a week between the u.s. and china, the world's two biggest economies. just have less flights a day than just a couple of minors in the u.s., to be honest >> that's interesting. i actually read some pieces that argue that it's that transpacific jet fuel demand, not just the inter-atsia travel that will be the missing link, so to speak, in at least

commercial transportation demand for energy >> that's right. and last week, they said, we are getting 380s ready, because we know when chinese tourists come out, it's going to be big, it's going to be massive. so right now we're in the mode of driving, it's kind of the same as we saw in the u.s. and europe drive now, fly later so people are driving more, we're seeing zbgasoline driving the petroleum market and we'll see this market drive things farther into year end and into 2024. but remember, the chinese have $2.6 trillion in savings that's just about the same number the u.s. had, frankly, after all of the government transfers a couple of years ago. that's what's created the economic boom in the u.s. in the last couple of years and the chinese have it in savings. if the government allows them to spend it, and i think they are trying to get it spent, we are going to see a good pickup in demand over the next 18 months but maybe in the short run, it takes a little longer than

everyone is expecting. >> i was going to ask, wasn't that well known the china reopening risk, shouldn't that already be in the price? instead, we've seen oil prices move the other way, whether it's a strong dollar or the new fed expectations so, it's hard to figure out sort of which one matters more. >> i think commodities are realtime assets, unlike bonds and equities, which are essentially trying to price in future expectations. oil is reacting to conditions today. and conditions today, as i said, are a little weaker, because you don't have the full force of the reopening hitting the demand side it will, just maybe in six months to 12 months. but i think at the same time, we have had very lax russia sanctions. remember, the market was preparing for a big disruption in russian ill supplies, and instead, thanks to the moves by the u.s. treasuries, to encourage the price cap, the relaxation of the shipping, lifetime bans that was initially in place, the relaxation of

rules of origin. remember, if you're a turkish refiner and buying russian crude oil, wafr hatever comes out of refinery is turkish diesel it's a big musical chairs game, where we haven't really taken chairs off the table, and russian supplies continue to grow against the market expectations which were, for a meaningful decline, in supplies so that's been another factor driving price forward. >> really quick, reuters is citing some sources today that russia is said to be planning to cut exports by a quarter in march or in february are you forecasting some kind of supply crunch, some severe supply crunch? >> look, i mean, russia may cut a little bit of supply, but remember, the russians have never been big fans of severely curtailing output. they've always been reluctant. so i don't know. if russia cuts a little bit of supply, it's fine. the market will get some support, but i think, i think it

will be a tall order for russia to deliver a meaningfulsupply to the market. like i said, it's possible, but i don't think it's extremely likely that we'll see that, despite all the comments we hear from the russian energy minister at this point. >> all right >> francisco, it's great to see you. thanks for the help today. >> thank you >> talk soon coming up in the next hour of "squawk on the street," we have the ceo of pepsico, ramon lagaurta quk t see wl "sawonhetrt"ilbe right back dow has gone positive again. we're up 25 points would you stop calling each other rock stars? you're a rock star. you are a rock star. rock stars. please! do you know what it takes to be a rock star? i've trashed hotel rooms in 43 countries. i was on the road since i was 16. i've done my share of bad things. also your share of bad things. we know that using workday for finance and hr makes you great at your job.

but that don't make you a rock star. ted! ted! ted! oh ted in finance. you're a rock star! hey liz in hr? can you do this? unless you work with an actual rock star. you are a rock star! thank you! who's the new guy? hi, i'm ozwald. hello ozwald. give it up for pam. pam, you are a rock- [silence] i wasn't going to say it. ♪♪ 92% still active? seems high. seriously? it's just a bike. wait. they make a treadmill with an intuitive speed knob? yeah. want to try?

92% stick with it, so can you. rent a peloton bike or bike+. terms apply.

check out the top gainers on the nasdaq 100 so far this year, chris, you can see, two of them are ev names one is set to report after the bell let's get over to phil lebeau, back at chq. he's got more for us phil >> david, loucid reporting after the bell they're going to report a loss, that's the expectation, 41 cents a share. this is a company that has a long ways to go before it turns a profit what should we be focused on today. what's the cash burn rate there? they had about $34.9 billion at the end of q3. the order backlog, how much has it dropped down, how much is it

falling off? what's happening with pricing pressure this is clearly an issue for all automakers remember, they cut the price on their model that is the only model that they're selling right now. so when you take a look at shares of lucid, keep in mind that the saudi arabian investment fund owns 65% of lo lucid and there have been more than a few rumors swimmering around that they may want to take a bigger stake in liucid the other two coming are pfisker as well as lrivian and finally, tlake a look at tesla. tesla continues to be the ev stock that is outperforming the rest of the group. frankly, it's outperforming the automakers and certainly has been over the last three months. something like that.

now trading just under $200 a share. don't forget, tesla has its analyst day coming up next week. and that's when we'll find out if elon musk has anything to say about pricing, perhaps a model two, some kind of an update there. lots of questions about the pricing of the tesla vehicles. david? >> all right i'll circle that date on my calendar phil, thank you. phil lebeau. time now to get over to carl and sarah. good wednesday morning again. i'm sara eisen here with carl quintanilla. we are live for you on the floor of the new york stock exchange setting the agenda for us today, we have pepsico's ceo, ramon laguarta on the pulse of the consumer and a tough macro environment. his outlook on price hikes and demand, as the stock comes off of strong earnings and sales in q4 later on, former federal reserve vice chair richard clairda, that has this market overpriced a recession like bullard suggested today? we'll talk some inflation, rates, potential soft landing, all ahead of the minutes this

afternoo