>> it's great to have you on, sri, because you said things -- you didn't waffle about anything you said, so we know exactly where you stand, and i've seen a lot of it come through over the last three or four years so -- >> thank you, joe. you're kind to remember. >> we should probably have you on more, because a lot's happened since last time we'll see you soon, i'm sure thanks >> thank you, joe. okay, make sure you join us tomorrow "squawk on the street" is next ♪ good wednesday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer at post nine of the new york stock exchange. david faber has the morning off. market hanging on to gains two-year, 4.12%, vicks still below 20 as we've got higher-profile earnings to watch in micron and lulu our road map is going to begin with stocks up now

lulu shares are surging on these results. ceo calvin mcdonald is going to join us in just a few minutes. and micron's rough quarter, reporting its largest loss on record but forecasting some better inventories ahead let's begin with the markets, though, on track for a strong open. jim, the set-up this morning was lower yields, but that turned around >> look, i think the nasdaq situation's very important little bit of a switch in leadership, nvidia, and that's because of chatgpt, but this is a group that's supposed to be going down or going into, say, a recession. there's some people who say, well, you know what? it should do well because the balance sheets are good. that's a false construct this group is not trading on balance sheet. it trades on earnings growth and there's obviously a tailwind here, whether it be microsoft, because of changes with gpt, whether it be nvidia with the new -- all the new products. not embraced by amazon because we don't know how many are going to cut back. alphabet kind of lost, but meta,

doing extraordinarily well, and i urge people to hit on the meta adds, and you'll see what meta is there's a -- reels is doing very well, and meta has a business. so, you've got some, you know, you've got some momentum that's not done, led by nvidia, which is here and now, by the way. nvidia's not something that's going to happen in the next two years. nvidia's happening right now they can't meet demand that's a great situation to be i in >> pretty interesting. it's the best quarter for nvidia in a while the software business at nvidia -- >> people miss that. >> some people don't understand there is a software -- >> grace and hopper, these different chips with software, what people don't understand about nvidia is they change their model a bit. you can go to oracle you can go to alphabet you can go to microsoft, or you can go to them, and they'll package it for you they are both a wholesaler and

to some degree a retailer, but there's no doubt about it, this thing is chock-full of software as opposed to some of its competitors that are just kind of lost. >> do you think the tech trade, to the degree it's working right now, is about sort of structural growth stories in a.i. and computing? or is it just, hey, we're on the heels or about to get our last hike, we think >> well, i mean, if we talk to -- let's say you talk to sanjay and read the call last night for micron chatgpt gets mentioned first, but chatgpt is very small. it's not a needle-mover for them you go to nvidia, and you realize that things are a little more robust. let's totally pivot to salesforce, which, salesforce is having a great quarter so, you have enterprise software, if you're profitable, doing really, really well. you have some semiconductors doing incredibly well if they're cutting edge now, we can see micron go up there was actually nothing in the micron quarter that made me think that we're not 18 months from what i regard as being actual growth, but we're only

two quarters away from a bottom, and people, historically, since 1993, have decided to buy micron two quarters from the bottom so there's a lot of gun-jumping. there's a tremendous amount of supply being taken out, but it's being taken out by micron, not samsung, which is just beginning to reduce. the pc cycle is still not there. i'm not saying it's hollow reasoning. i, too, go with micron i said that last night on the show but what matters is nvidia >> more than micron? >> yeah, because nvidia touches everything to the point where there's a letter that musk signed which talks about, maybe we got to go a little slower. >> on a.i. >> i think that trying to slow progress in history has been a real bad bet >> they're talking about risk to society. >> well -- >> that things are "out of control. >> they should listen to what jensen said. you know i think that jensen huang is brilliant what he's saying, basically, is there's no stopping it now, you want to put guardrails on it? he talks over and over again at the beginning of his 78-minute

speech about guardrails. these, the people who are against what he's saying, simply did not listen to the keynote. had they listened to the keynote, they would not feel that this, let's say, outright negative about what's going on i mean, you're not going to be able to say, you know what there's this terrific technology, but we're going to put it on hold >> for six months. >> look, this is not truman saying, we got to drop the bomb. it is -- it's jensen saying, listen, let's make this technology work well so it doesn't drop a bomb. >> well, there's a structural story about a.i., and then as jim says, there's the more cyclical story about inventories, which micron did address last night on the call take a listen. >> the semiconductor memory and storage industry is facing its worst downturn in the last 13 years with an exceptionally weak environment that has significantly impacted our financial performance. we have taken substantial supply reduction and austerity measures, including executing a

companywide reduction in force we now believe that customer inventories have reduced, and we see gradually improving supply-demand balance in the months ahead >> that's decent news for inventories, but he had some, i guess, net negative things to say about mobile and smartphones for the year >> i think that you need china to move from mobile, not to be able to do it on their own you need pcs to come better into balance. there's nothing there. nothing positive there's auto and industrial that's doing well, but it's not enough to move the needle. what's incredible is that samsung finally got the message. samsung has been flooding at a very big loss. a lot of the different end markets, particularly cell phone. and what sanjay's had to do is pull back, pull back, pull back, layoff, layoff, layoff he does say 2025 is going to be a growth year. people can say, that's two football seasons away. that's not the way micron works. you have to get in there ahead

all the different moves where micron's gone from fourth quartile in the s&p to first quartile have come two quarters from now big institution has to be in there. this man has taken the team, the free cash flow numbers are hideous, but because he has raised enough liquidity, kind of saw it coming. got to hand it to him. he's taking incredibly tough action there are -- they are not sitting there ordering a lot of machines as a matter of fact, that's going to be a 2026 situation when we do the chips act he's being bold, brave the fact that samsung is cutting back is probably more important than anything. datacenter, really not that good look, i don't want to pour cold water on the turn, but there's nothing this quarter or next quarter that's going to make you feel, wow, i really got into micron, i'm so glad, unless

you're someone, i know, will danoff that has to buy 30 million shares >> your point is that the market's not going to wait >> it can't, because in every single instance that it's turned, you got to move now. if you listen to sanjay, sanjay is not giving anything that makes you feel that you should be buying it this quarter, but he's not a stock picker. he's saying, look, the inventory is still very bad. i thought it was interesting he thinks that memory, the basic, is going to bottom ahead of nan, which i thought was surprising and he does see some into the drag of the cycle, but can't pin anything on that, and i didn't think enrique at hp did either there's a lot of hope here, but traditionally, when you cut back this morning, and you have this leg of -- this negative free cash flow, you got to move >> right >> it's the ugliest. a 13-year number took my breath

away, because i'm a huge believer in sanjay, and he has kept you out of the stock. he's done a pretty good job. and it's certainly not because of him he is not saying the bottom is here he's saying, the bottom will be here, and that's enough for a lot of people. >> we're going to see how the stock reacts to that later on this morning when we come back, though, shares of lululemo surgeing on the company's quarter. calvin mcdonald is going to join us exclusively at post nine in a moment with futures still positive vicks, still sub-20. i'm a retired school librarian. i'm also a library board trustee, a mother of two, and a grandmother of two. basically, i thought that my memory wasn't as good as it had been. i needed all the help i could get. i saw the commercials for prevagen. i started taking it. and it helped! i noticed my memory was better. there was definite improvement. i've been taking prevagen for a little over five years. prevagen. at stores everywhere without a prescription.

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i love a good story. it's a story where people just get it right management is so good. i'm talking about lululemon. it is surging after reporting strong holiday quarter sales and much more than that, issuing just tremendous full-year guidance, and, of course, faking out the people who believed somehow it was over. have they ever been to a store joining us now is lululemon ceo calvin mcdonald. first of all, congratulations straightout. you nailed the quarter i want people to hear from you, how do you deliver apparel numbers in an era where no one else can >> well, thanks. great to be back it really does start -- and i just need to acknowledge the incredible team that we have across the globe they, every day, delight and deliver the brand and execute flawlessly and i think it's consistently

with what we've been talking about, product that is driven through innovation, it's unique, and it's differentiated in the marketplace. our unique approach to community and the guest relationship and our d-to-c model, that really at the center of it is about omni and convenience >> you have nailed it, heather a health and wellness with apparel. that's something a lot of others have tried, including nike how does it come together so quickly? others have taken 10, 15 years to make this work. >> it has been core to our purpose. we talk about helping and focusing on delivering the full potential, and i think wellbeing and wellness is an extension, a natural extension of that. and then during the pandemic, we saw that become a more driving force within the market and with our guests and we're well positioned it's at our core, it's what we're committed to, and it's that much more important with

our guests, so it's helping absolutely to drive and fuel the business >> i was going over with our friend, matthew. inventories are clean. you don't have any promotion coming this quarter, do you? >> we've been saying we don't have an inventory problem for every quarter. it was deliberate. we saw the momentum in the business we saw the supply chain challenges, and we leaned in to have the goods to sell it to feed and fuel the momentum and we've been beating our guidance on managing that inventory down without markdowns, through full-price sale, and we've delivered on that and we're confident we've guided to, again, in this quarter, having inventory up 30 to 35% of it half of it is core it's not aged. we don't have an inventory issue. we leaned in deliberately. it's worked. it's fueled our business, and we're managing accordingly >> the citi upgrade talks about no sign of a slowdown, and they say, china poised to rapidly

accelerate is that part of the momentum you're trying to lean into >> we're excited about our business in china. it's part of our power of three times two plan to quadruple our international, and china plays a big part of that and in the quarter, our business was up 30%, 50% on a three-year cagr and that's with a lot of covid disruption we saw at the end of the quarter an acceleration. surprised me with how quickly china came back for our business excited about the momentum in q1, and it plays a big part in our growth story moving forward. >> some have argued that the reopening has had a delayed effect in getting to the chinese consumer you don't see that >> not in our business not at all >> i'm struck by both my summit story and the shorter mall story. when i walk in, i feel there's enough for men that i can both work out and also go to work in. emphasis on men's, i think, including tennis and golf, was always right i know you were going for that, but how big is it now?

>> it's a big part of our business i think we can officially declare that lululemon is a dual-gender brand and appeals to both men and women, and it's exciting, and we're just early, as you know, one of our power of three growth stories is to double our men's business. that's a 20% annual comp growth. we beat that last year our first year of our new five-year plan continue to see momentum in men's, and as you identified, i love the versatility from both sweat through to all-wear occasions, and it's an opportunity for us to bring a little bit of that into our women's assortment, where we're more anchored in more of the sweat, and we've declared -- we call it otm, an opportunity for us excited to see growth in both men's and women's. >> i have to bring up mirror, because we have talked many times about it it's a superior product. at the same time, it may not be where people are, but you pivoted and made it so it's still a profitable subscription that you got going >> absolutely. mirror was always about our community strategy and being in

support of it. our community strategy is to drive ltv and incrementalty, and mirror does that the pivot is to expand the amount of guests that will interact with what we think is industry-leading content through a digital app only, but there's value in studio, value in supporting our community strategy, and you know, we'll pivot, and excited to see the new strategy play out. >> have you been able to quantify the additional merch you can sell because of engagement in mirror >> yeah, that's the 9% number that we shared, absolutely we can look at that cohort their spend behavior before and then their spend behavior during, and it was really a big part of the investment thesis through some of the tests we had done before, which is, we know that engagement of guests in both their sweat and wellbeing lifestyle drives further engagement in the brand, and that's a big part of our community strategy, and now, with the launch of essentials and having 9 million members

sign up in the first five months, it's an incredible platform for us to bring the content into them, leveraging a digital app, and drive that incrementalty. >> jim mentions being able to work out and go to work. does the evolution of ret return-to-office, is that material to you? does it drive sales one way or the other? >> i think with the easing of more formalwear, if anything, it's a positive and upside versatility of our products for men's and women's, the fact that he and she see value, we see that as an opportunity for the brand to continue to expand our addressable market >> people are going to look at the stock, and they say, wow, it's up 50 points. a lot of thaem will be people who got it wrong calvin, what i don't understand is those who are customers just see consistent strength what is wall street missing?

is it, they don't shop there they don't understand you and what you have done this is a trajectory toward basically a worldwide health and wellness company, which should have a much higher price turnings multiple and is not episodic why do they think it's episodic? >> i think that might be a good question for them. >> i know, but i'm lost. >> we're nose-down, delivering on our commitments, and i think this management team has proven that we do that, quarter in, quarter out. we delivered our first five-year plan a year and a half early to double the business. shared our next five-year growth plan to double the business to $12.5 billion, and year one in, we're ahead of that plan we've guided to be at and slightly above that in year two. and we're early innings of growth and i keep pointing to our results after every quarter. if you look at product growth, every product category, double-digit growth. it's balanced. if you look at channel, online

stores, both contributing, delivering it is very balanced growth across every growth driver, which, to me, supports the notion we are early innings, just getting started and excited where this brand can go. >> do you think we ever go back to the days where we worry about supply chain, transportation costs, ocean freight, things like that? is that dead >> it's not dead we're still living through it. i think it's going to take two more years to normalize back to 2019 if we use that as the benchmark. we've made good gains. we still, last year, had 240 basis points in margin as a result of air freight. we will still have, at the end of this year, a hundred basis points in our gross margin as a result of air freight. our operating margin is just slightly behind 2019, yet we have 240 basis of air freight embedded in that the opportunity for us to continue to unlock that, invest that, and fuel the topline business is exciting for this

company, but i do think it's a few years to normalize and get back to 2019 >> sometimes i worry about cannibalization, but then i see something like north america, 24% e-commerce growth. international increased 39%. worldwide? >> worldwide >> that's incredible >> there's not a market we're in that i could point to and tell you isn't growing double-digit, isn't single-digit in unaided brand awareness and have opportunity. the business is resonating in every market we're in. we're in the right markets, and we have a significant runway to drive our brand awareness, to continue to connect with the guests, and it's exciting to see. >> most appreciative that you came on our show i'm not going to say it's remarkable performance i'm going to say you've consistently performed remarkably still to come, cramer's "mad dash" as we count down to the opening bell take a look at the premarket ahead of the bell autinbo eight

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closing in on the last few days of the quarter. futures looking pretty good here today on the heels of the results we've just talked about, namely lulu and micron a lot more in the days to come meantime, the opening bell is coming up in about six mutines, and don't forget, you can catch us any time, anywhere, just listen to and follow the "squawk on the street: opening bell" pod kat.

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the opening bell is brought to you by nuveen, a leader in income, alternatives, and responsible investing. time for cramer's "mad dash" as we count down to the opening bell >> you want jay powell to hold his ears when he's watching the show, and he may have to do that for this

paycheck reports small and medium-size business, the number is extraordinary "small businesses have demonstrated remarkable resiliency." the basicest maker of uniforms returns a quarter that is just extraordinary. so, if you want to know the cohort that has not been hurt by the credit crunch or by any crunch, it's small and medium-size business, which is, of course, the backbone of growth in our country. >> there are some who argue that you really don't get a crack in the labor market until those size firms start cutting back. >> there's no crack. right now, there's an acceleration, and the number at cintas is extraordinary. it's a white-collar recession. white-collar recession does not include people who wear cintas uniforms, and paychex benefits because they've been living off the flow >> yeah. we talked to lulu just now

you mentioned some other retail names. you didn't like this foot locker downgrade at ubs or the ross stores >> the problem with the foot locker downgrade is it's just very ill advised mary dillon just bought a half million dollars worth of stock, she turned around ulta nowhere in the report is it even mentioned. one of the things i think the person auto to do is go to the new foot lockers they're gorgeous they talk about the nike reliance, the way they're going to be hurt mary dillon wants minike relian to be over >> here to invite me to your funeral. >> thank you, jim fisk, for always reminding people when he was telling people they should go own gold one block from here. there's a definite funeral invite there >> you talk to lulu. their forward pe is still lower, cheaper than nike's. does it deserve to be the same

i'm not saying nike has lost their way. that would be wrong, but i'm saying this country has much bigger growth path and your question about china is rather extraordinary. the stock is up versus 2019. people got it wrong. i'm not going to ever go against nike because it's a great manufacturer, but wow. >> let's get the opening bell here cnbc realtime exchange at the big board, celebrating the recent listing of its first etf, and at the nasdaq, genelux celebrating its first ipo. pretty good breadth here as we're above 4,000. interesting piece last night about hedge funds capitulating their shorts on treasuries and that positioning is changing remarkably you heard earlier on "squawk," the talk about the ten-year going back to 3% >> well, look, i think the problem is that there's a lot of people at home who are very

confused many people are obsessed on what the interest rate is i would say this it's worthless, okay you've got a man like calvin on. if you want to look at the tens and twos, let's play rumikub if you can find people like this, and you say, i'm going to transcend the tens and the twos, or yesterday, when you look at some of the companies that reported, you know, you look at pvh. they were supposed to be written off. rl should be revisited apparel is coming back i just mentioned cintas. you can do paychex just avoid the banks the banks are trapped by the yield curve. there was a good piece from goldman-sachs about huntington bank i had them on not that long ago, 5.5% yield, no outflows to speak of but if you want to be in the blast zone, you don't have to

pay attention to the tens and twos >> do you not believe there will be relief in rates in the coming months >> i think that, look, i think that jay powell has to say, i got to figure out who else is on the wrong side of things first republic, i got tom there, and tom, very powerful guy, got a lot of friends, trying to rally the troops, so to speak. as long as first republic goes down, i think people will say, be careful there's still people who pick on schwab you know, they've got to do more work schwab is not in trouble schwab has the stickiest account base and the drum beat that schwab is next is so wrong i mean, you know, it reminds me of 1992 when people were saying, look out, it's going to be -- we're about to see bank of america go under i mean, you know, security pacific, yes >> goldman today does have a crack at the regionals, and they say they do see earnings risk

across the coverage, to the tune of 26%, but given the selloff, they still see 25% upside. >> you got to be careful you've got to go with ones that have very high ratio of deposits you're not going to deal with some sort of run on things, which i would tell you, cohen, fr frost and huntington bank are my go favorites hu huntington is a buy. some of those don't give you the data they need you go to jensen huang, you could have second-by-second withdrawal numbers, which would, of course, save silicon valley bank and save some people on the hill from being incredibly embarrassed. >> meantime, the wapo has this piece about the white house recommending rules, maybe not rolling back the deregulation we got in 2018 but trying to implement rules, and it fits with what fed officials are saying we can do through regulation,

not necessarily rates. >> i think that president trump made things easier in retrospect, maybe too easy the big banks are not in trouble because they have had a level of scrutiny that's extraordinary. and by the way, they've done a lot of right things because of that scrutiny, so i'm actually in agreement that it worked. does it hurt loan growth obviously hasn't, or we wouldn't have this boom that we have. >> that's the other thing, jim it's been three weeks now since svb, and we've gotten some, you know, marginal data, jobless claims, used cars, some corporate commentary, obviously. the cracks are the -- or the effects haven't been, like, explicit >> no. and you know, we see a lot of what i regard as a real false narrative. you'll say, wow, housing is down 5% from the high it's up one-third from the blow. you can't -- these are algebraic equations. people have to go back to seventh grade and realize we're nowhere in terms of getting back

to 2018. if jay powell wants to get back to 2018, he can't do it. we are seeing indicators like trucking is down very big. we know that supply chain constraints have made it so that we do have inventory problems with some industries sanjay pointing out, by the way, that autos are stabilizing, and that's because they have product. but it's just not a terrible time in the economy. there is some slack, not a lot of slack, but if it weren't for the fact of silicon valley bank, i think that jay would have done 50, and it would have been justified. >> right meantime, you see tech's outperforming once again with the nasdaq up 1.33% on just the discussion yesterday was, will micron ratify the move in tech and chips? and the answer is, yes >> look, micron is -- they're supply and demand. i mean, the demand's not any good, but they've cut back supply to the point that they're losing a huge amount of money, and samsung started to cut back.

that's very important, because samsung flooded every single zone with too many chips but come back. when you think of tech, you think it would be some microsoft. well, microsoft's doing so much right, but it's chatgpt. when you go to look at what is happening on the hill with tiktok, and you realize that mark zuckerberg has spent a tremendous amount of time on reels, and reels, beginning to make some traction because you don't want to be an advertiser in a big plan on tiktok and then discover that you don't have tiktok, ask there's, what, 53 billion hours that are available wow. i mean, that's a lot of hours. people ought to read books >> in media, they talk about share of wallet and share of time, and that's a lot of time >> i'm on tiktok when i feel like that my brain has to take an intellectual vacation, not unlike my colleague, david faber, yesterday, when he was endorsing communist china. >> great line. speaking of which, apple, we

haven't really talked about buy now, pay later in the move yesterday. >> remember, they're not really extending credit it's a four-part over six-week, no more than $1,000 plan it's much more about getting share of your wallet talk about being responsible they show you where you are. now, i'm not saying that max's irresponsible with the firm, but that's artificial intelligence to be able to find the right -- to match buyers and have a lot of credit risk i mean, look, i thought this was a responsible plan, not unlike, by the way, when i first got my macy's card, jeff, wish him the best of luck, see him tonight. but i think it's a very smooth transition for apple to take over one more area in a very responsible way with good security and privacy >> is it -- we're talking about macy's in a second, but is it in a firm killer? the apple move >> no. i think that what it is, it's a convenience buyer. younger person wants to be able to say, listen, i don't need to put all this money out, a

thousand dollar bogey, i think, is interesting a firm is, you know, a firm is capital one. >> right >> but without the high fees >> right you mentioned macy's and gennette will retire next february tom sprint coming in from bloomingdale's gordon said it cuts to hold on slowing traffic. >> look, the same-store sales have been nothing to write home about, but remember, the new ceo is from bloomy's, which did have good same-store sales. they're down in a lot of segments, and i know jeff g gennette cannot find that comforting jeff's done a lot of good things, and i think that this is nordstrom doing great? i mean, how about kohl's that's the cohort. the department store is a challenged business, but i think

the stock is inexpensive >> yeah. interesting piece in the "journal" today about gamestop and how they're revisiting their stance on physical stars versus e-com. >> gamestop and amc are not really stocks. i used to play with ponies, and you used to go look for delaware downs. >> harness or -- >> no, never those were always -- no. this was from andy beyer, one of the greatest stock-picking books in history, but these are just outliers they're outliers and i don't know what to say about them. they're inscrutable. yesterday, someone floated the idea that amazon was going to buy amc. >> did you want to talk about that or not? >> i could float the idea that amazon's going to buy illinois toolworks. that would be good what a merger that would be. >> threw it on the white board >> andy jassy has always wanted to be a good tool and dye man. >> it does move amc yesterday. >> it's important to manipulate stocks if you're a crook

by the way, speaking of that, we haven't even touched binance yet. remember when southern methodist u got the death sentence this binance piece is a death sentence >> you said, "it paints a picture of a company gone rogue. >> it's kind of like a netflix -- honestly, i don't know if -- it's an eight-part drops all at once series about a group of people who are making fools of us. now, by the way, they're not making fools like the prc is >> funny you mentioned that, because "the ft" has a piece on binance and how they took efforts to hide their ties to china. >> you got to read it. it's very funny. and they manage to be able to make it so the curse words are -- they're redacted a little bit so it's family fun >> all that. >> but what's amazing is they said, we're not doing business here and yet, this was their biggest

market they said they had real no-touch here and yet they're trading futures here it's incredible. the amount of -- they may be the biggest scoff law i have seen. you have that very low bar of sam bankman-fried, right >> there was a point at which this was the "savior". >> i feel so much better you know, it's -- it's not madoff >> right >> there it is i'm going to make the statement right now. binance is not madoff. i'm putting it out there >> that said, jim, why is bitcoin holding in if that liquidity is at risk >> because bitcoin is actually of the subject of a very difficult congressional issue. i mean, you've got -- you've got gensler, who's trying to go against the idea of creating coins with coinbase, and gensler's 30 times with coin because, but they have not been able to do anything to damage bitcoin, and here we are discussing republic bank i mean, bitcoin versus republic.

i don't know i went by republic when i was on the way to time warner and said, put a bitcoin store next to it >> it's the best quarter for bitcoin since q1 '21 >> it's a rebellion against the system and i think the system is viewed as corrupt by many people, and t bitcoin is not i think the real issue with coinbase, can you create a new coin all the time? i know that the gensler s.e.c. says, they're creating securities day after day there's a ripple case. they may not even win the ripple case, but the binance is very different, because that's basically saying, okay, we got a criminal enterprise, and we've got to stop it i think it's a northern illinois federal court, i think, the win, binance, it's not a question of cleaning up their act. there is no act. >> there is no act to clean up >> no. >> couple other pieces this morning, jim lucid, we talked about the 18% head count reduction yesterday

adam jonas says other ev makers are going to have to consider -- >> if they fire everybody that can make money, that's when they -- that's when it comes into the fore. honestly, lucid, you know, 18% of the workforce when i went to see peter, the car is just fantastic. but what we're discovering over and over again is that's an irrelevance. it's how to make the car and make money on a car. >> the technology is separate from the production. >> right i mean, you know, look, these things were all -- they were spacs, they were exciting. but tesla's real and is with the exception of the pickup truck, which i think will be no match for the lightning f-150, i just think that it's game, set, match, tesla. they make cars, and they make a lot of money >> and can afford to lower price in an environment where that's a vacuum right now >> yeah. they can model-t ford. that's the problem they've got the model t. >> sticking with transports today, boeing, jim, the ryan air

ceo says they're back in talks >> boeing's doing a lot of things right right now, but it's hard to go wrong when it comes to transport i said last night on "mad money" that one of my worst mistakes was -- david would hector me on bo boeing, how can it be long finally, he got to me and i folded it was at the bottom thank you, david i appreciate it. >> yeah, we do miss his hectoring. >> yeah. he got me down he wore me down. he can do that but boeing is back now, people can still do with ge when they spin off the ne'er-do-well energy business, and i'm sorry, larry, i know it's doing very well we're playing with honeywell >> who presented yesterday, i believe. >> yeah. i thought we had a very good meeting, very self-deprecating i beat myself up on seven different stocks and next time i'm going to bring a whip, maybe with some spikes in it >> to jim's earlier point about chips, intel leading the dow

this morning, up 3% gain with the dow -- the index up 250. >> they got to teach, and by the way, sanjay mentioned intel in the same breath as amd that was nice. >> doesn't happen all the -- well, they mention in the same breath but for different reasons. >> look, if i were pat gelsinger, i would say, have you looked at the chart? >> we'll see let's get to bob pisani. >> this market here, we're over 4,000, 8 to 1 advancing the declining stocks, all 11 sectors to the upside. now, a lot of this, of course, is being led by tech, but there's some other things starting to creep up as well take a look at the sectors today. there's your two leaders for the quarter. we're going to start talking about the end of the quarter tech and communication service on fire here look two terribly beaten-up sectors, banks and energy, have done very well recently. real estate investment trust, another group that's up, starting to show some signs of alive in the last few days

another terrible quarter overall. so, very, very wide breadth here we're in an uptrend right now on the stock market i just want to point out, and we get to the end of the quarter, we're going to start pointing this out, what's really moving the market up has been tech and communication services here. i call them the trillion dollar club the top four all four, trillion dollar or above market cap apple, up 22%, amazon, microsoft, apple, all in the mid-teens. these are amazing numbers. these are the top four stocks in the s&p 500, and when you get to the second tier of mega cap, it doesn't even better than that. nvidia, these are not typos here these are the top tier when these kinds of stocks move this much, it moves the entire index. jim is right a lot of the excitement over chatgpt, particularly for nvidia and microsoft and maybe for amazon and meta as well, but my point is, when they move that much, look what it's done to the

s&p 500. we were up, going into the open, we were up 3.4% for the s&p 500. those seven megacaps are pushing the s&p up 5%. so, these seven stocks are actually responsible for 150% of the move in the s&p 500. it means that the other 493 stocks are on a relative basis, underperforming. think about how powerful --s this the power of big-cap stocks and when they all start moving, heavens, this is what happened in 2021, the same kind of thing. it moved the overall index up, and the question is, are we really going in the right direction here is that the way we want to go? we're closing out the quarter, and it's a nasty bull-bear debate there's not a lot of agreement on anything. the bulls keep screaming at me, we're in an uptrend, bob, look at the charts, the yields are dropping, and this is the top of the tightening cycle, which is more hope-ium. the bears have a number of very important points there's a yield curve going on,

and usually that means recession coming on here the valuations are really rich 18 times forward earnings is not a recession multiple, folks, not even close so, somebody's wrong here, essentially. and of course, there is issues with the higher cost of capital. finally, carl, i'll tell you, people are asking me, is the fed put back everyone believes the fed is not going to accept in for major market declines. we've come to believe that for the last couple years. well, they stepped in for the banking situation to help the banks out, so people are saying, bob, are you sure the fed put is completely gone? i don't know but it's back on the table for discussion back to you. >> bob, thanks for that. as we go to break, let's take a look at bonds. we mentioned they were lower in the early part of the premarket. flipped higher you got the two-year still above 4% this morning. all sectors are green on the s&p, led by consumer discretionary and info tech, and the vicks now closer to 19 than 20 be right back.

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the monster move this year in megacap tech continues today. but joined by a bunch of other names, first republic and micron are adleing the s&p. only six names on the ndx are red and the dow is up 255. stock trading with jim is next

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let's get to jim and stock trading. >> you see the overvaluation in this red hot market. i come back to petroleum, sells at six times erarnings. so we have to distinguish between the part of the market that's been left behind and the nvidia part. you have a barbell situation where good excitement in tech and meta too and a lot of companies with five, six, seven times earnings if we don't have recessions because the fed doesn't put us in one, you have to buy these five, six times earnings

that's nvidia, it's refining chatgpt. >> one handle today. >> the good thing about natural gas, it can't stop at zero good piece today about how russia is in trouble because they don't have cash flow. russia rivals the united states in 1910 in terms of how much we put out and they put out the rivalry is back. the piece in the journal, ruble down 20%, mass exodus of human capital. the giants have lost customers. >> pass the vodka. >> they're going to need it. >> yes tonight you have macy's. >> yes they've done a lot of good things, built a very good anti-cancer franchise, the king of vaccines and paychecks. i like paychecks to see what small, medium size business is doing. the economy is back to being

strong thank heavens for the knuckle heads at silicone valley bank. i use knuckle heads because this is a family friendly show. >> they have done work for powell >> you have to read binance, it reads like there's a new show on netflix, "night agent" there you go thank you because sometimes there's so many shows i'm watching false detective. >> we'll see you at 6:00, "mad money" 6:00 p.m. eastern holding tight with a narrow range today, s&p 504011

♪ good wednesday morning welcome to another hour of "squawk on the street" i'm sara eisen live from post nine as

always david faber has the morning off. look at the stocks higher up more than 240 points on the dow. s&p up a full percent. leaders today, real estate the battered reits at the top of the market every sector is green right now. 30 minutes into the trading session. here are three big movers we're watching right now, starting with lululemon rallying on the latest earnings beat more on that quarter in a moment look at micron, moving higher, despite the biggest loss on record as executives there point to easing inventory issues and we end with carnival, upgraded to positive from neutral saying carnival has ample liquidity and should be able to improve unit margins stocks still down 50% over the last month we talked to the ceo he was bullish. >> the upgrade having effect we have housing data diana olick has that >> pending home sales eked out a

0.8% gain. still down just over 21% from a year ago the monthly gain is much smaller than the 8% jump we saw in january. here's why look at mortgage rates they started dropping off the fall highs in december and came down sharply in january but right back up in february from 6% to over 7%. these pending sales are based on signed contracts during the month, people out shopping when their purchasing power got smaller because of the higher rates. we can see it in the regional so you want -- count sales were up everywhere in the west rates really hit affordability there. we have seen home prices cooling in the last six months but still high the surge in sales in january may have staled the drop in prices we've seen reports of prices moving higher in february.

overriding issue is there are still few homes for sale given the continued strong demand. sarah. >> if you put this report in context with the other indicators on housing. i know mortgage applications were up, how much is the housing market flowing >> the housing market has been slowing down for the last six months because of high errates rates are volatile the last six months this month we get that weekly so that's a more current indicator and it's volatile because we saw rates come down swiftly during the beginning of the bank crisis and then shooting up again this week we have a ton of demand in the market the issue is no supply, it's still high prices and mortgage rates are inching up this week over 6.6%. so there's a recovery, it's spring, still very difficult to afford a house right now, bottom line. >> diana thank you diana olick on the housing number.

feeds into the whole conversation right now, carl, which is are prices slowing enough to get the overall inflation and economy down which is what the fed is targeting and is the market right the fed is done raising interest rates and are going to be lowering interest rates on that front we are continuing to see strength. the financials are up two days in a row now seeing less fear out there the vix closing below 20 for the first time since the banking crisis good signs compared to a week or two ago. >> bullard said last week he'd talk about inflation over financial stability. that took four or five days. >> it's early, the house financial services committee is taking up the issue with the regulators so far it's calm all the research out there on the equity market even the ones more bullish put the caveat. we don't know yet. we think the market has moved on

from the losses but those two worries are still out there on ban ba banks. the question is do they get priced in on the regional banks. goldman reiterating there's a buy. >> wells today, lower yields and a final hike generally means that stocks do well in the following three to six months and think they should support higher stock prices for now. longer term we see economic pain and funding dislocations that's what you're talking about. might be good for a rental but we'll see about the longer term. >> and also a huge debate right now about how much the banking pressures are going to impact the real economy we've seen tightening and standards for lending like autos and housing and lending, bank of america put that out nicely. how swooefr issevere is it going to be. the tracker for q1 is 2.3%

growth that's not bad that came out on friday. so consumer is still in decent shape. there's a lending particular standards to consumer. and you can see what happens during recessions, they tighten very much and we're back on that up trend that's what everybody is worried about and the ripple effect that's going to have on the economy. let's bring in our next guest who says the banking crisis has made the mortgage backed security crisis worse. logan, just some of the housing data we were talking about with diana olick and whether we are seeing enough disinflation to make the fed satisfied here. because shelter has been a big problem. what do you think? >> i don't believe the fed is going to be satisfied until they see the labor market break, which means jobless climbs are -- job less claims are going to break much higher than they are

today. mortgage rates should be lower than they are today. but the housing market has really kind of stabilized november 9th of last year when rates started to fall from 7.73% to 6% and back and forth so we've seen stabilization in that front but the fed is basically bent on kind of making the labor market break so this is their disinflation weapon at this point >> i guess i was specifically asking about housing though if housing prices go to zero percent growth, that would do a lot, wouldn't it for core cpi and an overall inflation >> if you look at core pc with tons of home price growth it was at the fed target level. it's really rent inflation and that's been cooling down now for some time. it's going to lag the cpi data

home prices themselves does not push rent inflation up, those are two different categorcategos housing, over time, in about 12 months, the growth rate of rents will make that cpi data much lower. it doesn't impact the pc data as much, the fed's 2% target. the fed needs to endure this inflationary period and try to not create a job loss recession to get their 2%. i think everyone will be more happy with that outcome than just pushing rate hikes and waiting for something to break and credit getting tighter and people losing jobs that's not just the way to get through their ininflationary targets. >> a lot of discussions yesterday about kay schiller and the cities that are negative year on freer, san francisco, seattle, san diego, and portland the journal did west of colorado

negative and east of colorado still positive i wonder if this can be contained to the western quarter of the united states >> listings are near all time lows, new listings negative year over year, the area with the highest growth are going to get hit price wise but nothing like what we saw from 2006 to 2007 where we saw a mass supply of inventory everywhere due to distressed sales so yeah, it can be contained as long as you don't have a really bad job loss recession and the job loss recession lasts a very long time, definitely we only see the really big housing hits on areas that took off on home prices in a short amount of time everywhere else is somewhat stable that's a good thing it shows the credit channels after 2010 have worked people are staying in their homes, living in their homes

longer that's a positive. we can fight inflation without creating a massive job loss recession or housing looking like what we saw from the 2008 to 2011 period. >> logan, thanks for weighing in if today appreciate it with the data. we are seeing home builders jumping. let's talk about the consumer, lululemon jumping after reporting strong holiday quarter sales and issuing upbeat guidance ceo calvin mcdonald on set here in the last hour discussing the company's quarter. and here's what he said about inventory. >> we saw the momentum in the business, we saw the supply chain challenges and we leaned in to have the goods to sell and feed the momentum. we've been beating our guidance with managing that inventory down without mark downs and we've delivered on that and confident we guided again having inventory up 30 to 35% in line

with sales at the back half of the year half is core, it's not aged. we don't have an inventory issue. >> one thing to pick apart in the quarter, it was a strong one for lululemon, but actually inventory is elevated and people see it as a problem, it's more than 50% and they're guiding it to be up more than 30% by the end of the year. that is now tracking above the industry, which has been making much more aggressive moves to unload its inventories and do more markdowns so if you had to pick something in the report that's not the cleanest, there's that but 29% growth in north america, 35% growth internationally, double digit growth across men's and women's. another strong quarter for a company going in had negative sentiment. the stock had under performed the last few months. >> people who followed the name the last couple quarters know the way it was going into the

print. citi today, better than expected, no signs of a sales slow down. chapper than nike they go to buy. >> jeffrey, though, jeffries keeps it underperformed rating on lululemon actually, one other point that they raise i don't think people are talking about it everyone is excited about the men's growth but men's growth, 22%. the first time in eight quarters it has not exceeded women's growth and the important thing there, that was the story. they had the women's market. men's was a fast growing new category so something to pay attention to looking for these numbers to continue now the bar is raised. 15% move higher and very strong results across the board. >> interesting the way the -- at least the sell side is really starting to slice and dice retail you have these upgrades of lulu

on the heels of the quarter. cut macy's to hold uvx took an ax to foot locker, burlington, go to sell on those. even though jim said if you follow that, invite me to my funeral. >> on foot locker. a lot of people have been bullish on that name but the ubs note was interesting because it wasn't necessarily name specific it was a macro conversation saying the conversations about retail, the idea there's a recession and that's a big headwind to growth and sales is a bear case. so they're just adjusting to what they see is the reality in the economy. and that will hurt retail. >> and you know we get to look forward to today, is restoration har hardware always vocal about what the environment is like in his view. >> he's going to complain about

treasur tre treasury secretary yellen. it's impacting on the furniture inventory. as we head to break, our road map. including credit suisse whistle-blowers saying the bank has been helping wealthy americans dodge taxes for years. crypto on pace for the best quarter since q1 of '21. >> howard schultz on capitol hill testifying before a bernie sands d mmteonaberlecoite lor practices. big shows still ahead. rally up more than 200 points on the dow. don't go away.

some shuffles hit this morning, the ceo of ubs from 2011 to 2020,:20, he's back return to help with the bank's emergency takeover of troubled rival credit suisse. he is set to take the reins on april 5th, saying he returned after feeling what he called a call of duty >> fresh trouble after new whistle-blower disclosures

>> the senate finance committee released a report detailing allegations against credit suisse the bank that collapsed and was rescued by the swiss government and ubs earlier this month the report alleges that credit suisse has been helping american clients hide hundreds of millions of dollars from the irs, despite an agreement to cooperate with u.s. tax authorities a decade ago investigators tell cnbc they found 25 american families that cre secreted away as much as $700 million in the bank in years. and saying that played a part in the bank's failure i sat down with two former credit suisse bank es who served as key witnesses for the committee's investigation. cnbc agreed to disguise the identities of the bankers in order to protect them because they fear retaliation from the bank the interview was conducted in the weeks before the bank failed. >> what secrets did you turn

over to the americans? >> one specific about an american family that over years and years and years hid their money in switzerland and did not comply with their taxes. >> and you knew the name of the family >> correct. >> and you knew how much money they had. >> how much money they had i knew the accounts were all numbered secret accounts that were named by italian cities. >> code words were italian cities. >> yes. >> in 2014 credit suisse pled guilty to filing false tax returns and agreed to pay a $2.6 billion penalty at the time the bank pledge today comply with american tax authorities in the future. but the senate finance committee said the swiss bank didn't do that instead they engaged in a scheme to hide american assets

by switching nationalities to other countries. back in 2016 they told senators they cleaned up their act. >> we have taken steps to require that only those u.s. clients who establish compliance with the u.s. tax laws can be clients of our bank. >> that was a lie? >> why do you say that >> they testified they were 100% compliant, they testified they had gone through all the accounts and they no longer had a problem. not only they had a problem, they had a very big problem on their hands. >> how do you know that? >> because i've seen firsthand what they did. >> one of the whistle-blowers told me how the scheme allegedly worked making sure wealthy american clients got a second passport. >> you're talking about americans who hold two passports. they open the swiss account in the foreign passport and put the

american passport in the pocket and the irs obligations in their pocket. >> exactly. >> senate finance investigators obtained emails from inside the bank in one a client heir to a $200 million fortune writes to a swiss banker writing u.s. citizenship renounced. attached is a confirmation letter i got in the embassy. i tried to reach you, congratulations the banker rep replied. this was a big step for you. the heir to the fortune replies thanks hopefully this should make cs more relaxed he closes with a smily face. >> senate finance committee chairman ron wyden told me it's not clear how much if any secret american money remains in in the bank but he wants the u.s. department of justice to look at the bank's 2014 plea deal which he said gave the bank penalty

discount for future cooperation. >> it is still going on as of just the last couple of days, even more money has been found to have been con soncealed there are very substantial issues here, i'm not taking anything off the table but clearly it's time to prosecute and ensure there are penalties that send a strong message >> now we reached out to credit suisse and a spokesperson there told us credit suisse does not tolerate tax evasion in its core the report describes legacy issues some from a decade ago and we have implemented enhancements to root out individuals who seek to hide assets under u.s. law, whistle-blowers to the irs stand to receive between 15 and 30% of anything the u.s. government collects these two secret swiss bankers stand to potentially make millions of dollars, and u.s.

taxpayers potentially may recover even more. back to you. is this a problem for ubs? >> it's a liability overhang for ubs. what we don't know is what the dollar value of that overhang is for the department of justice, there are some options here, they might able to do back and impose additional penalties or in some way claw back some of the fines not imposed in 2014 because they've come to the conclusion if they have, the banks didn't fully cooperate with the prosecution agreement back then we have to see how the process plays out but it's ap unknown now for ubs. >> great work. a few pieces coming together. still to come this morning we'll hit bitcoin on pace for the best quarter since early 21rayiga today, holding in despite the move on binance. dow is up 220. back in two.

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for the best quarter in two years. dom chu has been tracking the action this is hard to expect after the end of last year, the ftx blowup and everything else. >> it's almost two years to the moment it was the first quarter of 2021 when we saw these prices rise by as much as we have over this quarter so far barring some kind of unforeseen last couple of days, it'll be a banner one for sure. the reason we bring it up, that sentiment has not just been carrying up with bitcoin but also the other xrp, carda know, all seeing upside. you mentioned the move i mentioned in the first quadrter of 2021. right now on this year-to-date basis, we are seeing bitcoin outperform it's up 71% and either up about

50%. so yes, two years some huge returns quarter to quarter during that span one of the places you want to keep an eye on is the move we've seen vis-a-vis the stock market moves especially in the nasdaq which is a huge outperformer you can see bitcoin prices out performing the nasdaq, 100 invesco qqq up 17% as well the reason we bring it up is some traders and investors over the last couple of years noted the correlation between the nasdaq 100 and bitcoin prices and cryptocurrency perhaps in general. data team at y charts looked at the correlation between the qqq and bitcoin prices at one point over the past year that relationship was closer to 0.9, meaning they traded almost in lock step in the fall it went down to 0.4 and currently sits

at 0.7 so sarah that trading relationship is a big focus right now headed towards the second quarter whether or not those relationships stick around that remains to be seen. >> arc innovation fund i would say as well. it's up 23% quarter to date. >> absolutely. >> thank you, dom. a quick note as we head to break. it's not too late to join cnbc's healthy return event we're convening with those that can give you the iidnse returns health care as a sector a lagging today and so far for the year back in 2 minutes. ah, these bills are crazy. she

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welcome back i'm frank holland your cnbc news update at this hour.

ukrainian president trump volodymyr zelenskyy is warning of the consequences if russia wins the battle in the east of the country. zelenskyy said if ukraine failed to hold bakhmut, putin would sell the victory and push for a cease-fire deal. the senate is expected to pass bipartisan legislation today that would repeal the authorizations congress passed in 1991 and 2002 for the u.s. wars in iraq the fate in the gop led house is less clear the white house said president biden would sign that legislation if it came to his desk. the fda approved the first over the counter overdose treatment. it'll be sold as a single dose, given as a nasal spray and likely will not be available until the late is it your testimony -- the late summer

back to you. the markets, that pull to s&p 4k continues to roll on. all sectors in in the green led by information technology and consumer names maybe not a surprise coming off the heels of the micron and lululemon results last night let's get to bob. >> this is a broad rally, let's look at the main sectors, tech and communication service the leaders this corner also seeing beaten up sectors moving in which is nice to see in the last week or so of the quarter. we have tech and communication big movers for the quarter even bank stocks moving up in the last couple days not big but call it stable, materials and industrials have had a number of good days and they've had a terrible month overall. this is a sign of breadth expanding in the market. good for the bulls the simple way to look at the s&p short term we're remaining in an uptrend. the lows going back to october

there. the bottom of the chart in the middle there that up trend is still intac right now. that's part of the reason for some of the optimism in terms of what's moving here, mega cap teches, again strong today, salesforce has been a monster this quarter nvidia, apple, microsoft i'm going to show you for the quarter. when you have the top four stocks, the trillion dollar club i call it, they're all a trillion dollar or more, apple, amazon, microsoft, alphabet, those four stocks alone are going to move the s&p 500 even if everything else is down and other ones out there in the large megacap tech group like nvidia, tesla, they're up dramatically more than that. so that's what's moving things up i want to point out what's going on with the regional banks because they stabilized. the last couple of days the trend has been up, this is not momentum forward these are

stabilized within the trading we've seen in the last couple of weeks. that in itself is good the other thing that's positive, cyclical stocks. we talk the steel companies, freeport, caterpillar, generally all down but the last two or three days they have turned around i'm not saying this is breaking out, it's not. but the momentum has changed a little bit towards the positive side here. finally, sara, i want to point out you want to see the volatility for the stock market. the chicago boards options exchange, a new high i was with the ceo last week at the futures industry association conference, chaired a panel with him. record options volume, sara, in the month of march i talked with mr. duffy, record futures volume as well in this month. one of the real beneficiaries of the turmoil.

back to you. >> we have been highlighting the m stocks they win in times like this. bob, thank you. let's bring in david kelly david, you heard bob, things do seem calmer out there, the financials have been up a few days in a row, add the vix, the vol vol volatility index below 20. the move coming down from the crazy levels at 200. does this signal that we've wrapped our arms around the problem and things are going to be smoother going forward? >> for the moment i think that's correct. but i think that going forward, the problem is that, you know, the federal reserve raises rates one more time there could be a presumption there is a fragility about some parts of the system as the fed raises rates. so i feel like they're on thin ice here and it comes back to

last month they really don't want to, you know, try here so i think they're probably done, if they are, we may still have a chance at a soft landing. >> what if they're not gdp is tracking 3.2% for the first quarter. we have pockets of inflation, housing inflation isn't coming down fast enough, services inflation hasn't shown much evidence of slowing down i know people are worried about the banking systems but what if they keep raising? there's a case to be made there, isn't it >> i don't think there's a case. i think we're seeing rates coming down -- sorry, inflation is gradually coming down i recognize there's some problem with shelter hanging in there, but usually it takes a few years to get down to 2% in the normal course of things but i see what i think is most

relevant, wage growth is below inflation. that tells me workers don't have that much gbargaining power so i think inflation is coming down anyway here now it looks like we'll get a strong first quarter for gdp i think weaker for the rest of the year, but the important thing is so long as whatever they're getting. so long as it's compatible with falling inflation. there's no reason for the federal reserve, with banking prices or recession, they need to weigh the cost and benefits here because the economy is in an okay place if we can escape okay recession >> meantime we do have other calls for say, commodities to go up 20% in the next 12 months that's ubs today there's an ongoing discussion about whether we rung enough disinflation out of goods as we could. do you think china remains a factor for inflation the rest of

the year >> perhaps but the chinese economy isn't as dynamic as people think it is. but i think also that the overall global economy is not exactly here we've had a period of high commodity prices that usually brings forth more production and some strains in terms of consumption so i think we'll see commodity prices move sideways or up a little but i don't see a big bounce in commodity prices the rbirthrate is down all over the world. so i don't see a huge demand, we don't have a huge surge in products >> so the market is where you are. the market doesn't expect the fed to raise rates and expects the fed to cut later on. interesting the s&p 500 is higher than before the banking trouble while the two year note

yield is down 2% from that period are they sending mixed signals about the economy? >> no. i think both of those things tells us inflation is coming down we have the stock market and bond market down the same year because inflation is going up. now inflation is coming down, that's good for the pbond marke and stock market and one -- it is possible that the reserve will move higher it's possible they'll stick to the rates, but if they do, they just have -- i think the market is deadening to the blink here. >> so do you buy >> i think you do. i think international stocks are a lot cheaper than the u.s. stocks but in the u.s. there are plenty of deals. you have to look at valuations there are plenty of stocks remaining.

you have valuations, a little more value with large cap, but please take a look at your international with everything international and we think that the dollar is coming down and there's a lot of funds >> all right your plea has been heard david kelly, thank you very much appreciate the commentary today. >> still to come this morning. a touch on micron posting the largest loss on record within 20 cents of the intraday high year to day, and close to the resistance it's faced since last june. we'll tell you why, we're back in three

micron shares headed higher despite results that missed estimates. let's get to kristina partsinevelos with the numbers, and the reaction >> reporter: micron pretty much

ripped off the band-aid posting the biggest loss ever, writing down $1.4 million in inventory, a sales plunge of 50% and a cap x cut but the stock is higher because investors were preparing for the worst, got the worst and like the forward looking comments from management on the earnings call. let's go through the statements pm the inventory write down was large but the ceo said he sees it gradually improving in the months ahead data center revenue bot tommed in c with a return to healthy levels by the end of 2023. the third point, company projected revenue in line which is why you saw the stock climb higher but is it too happy too soon cap x was lower, still expect negative supply growth for 2023

and yet investors seem convinced, memory prices have bottomed from the the call and the bottom and memory came a little bit later than pc and smart phones intel, highly exposed to end consumer products seeing a reversal shares up almost 15% the company cut the dividend, slight improvement to company execution and doesn't appear to lose as much market share to amd. not worse off and that's a good thing for the name in a few hours, management will provide an update. expect long term targets which may not move the stock and hopefully a reiteration for the server recovery in the second half of the year led by improvement in enterprise, customers, and china carl >> we'll wait for that coming up within the hour. thank you kristina partsinevelos. micron not the only name seeing gains stocks on pace for their best quarters since 2020, talking

about how to break these things down let's start with micron. we're back to the discussion about the market trying to discount peak inventory but not get over their skis. do you feel this is a moment you can reasonably look at the name? >> yeah. thanks for having me on, carl. i think if you look at micron, we think the quarters behind them, you heard them say in their call, as you look forward what you see is significant cuts, continuing supply cuts, that should position the industry much better as you look at 23, 24, the significant supply taken out of the memory supply chain, not just china where i would say both samsung are capped but also pretty much not a player in the game anymore so we think the memory side is going to be significantly

undersupplied. as you look at the first half of '24 especially we think the first time improvements are starting to show, causing the stock to come down and then second half all about demand we think especially for the data center having bottomed, probably hear more on the ai side in a little bit here today. but the ai is the trend on the back half. any improvement from a china reopening are a seasonal holiday into q4. >> i was wondering whether or not you think we'll hear echos of micron's narratives from intel or later on in the weeks to come from nvidia and amd, for example? >> i think the echo between the two, the similarities between the two would be the call on the data center side i think it's carry for the entire hyper scale enterprise today is ai. we're seeing most -- i would

also highlight article oci it's been the forefront of cap x in data centers for 2023 so that plus ai is another strength in the back half. hyper scale enterprise on the compute side but the ai side is getting a lot of attention a lot of spend, dollars for nvidia, microsoft, chatgpt as we mentioned. >> a huge new story and the market is getting their arms around it. an eventful night around it. >> nvidia is up 82% year to date still to come another deep dive on the consumer with the ceo of general mills headed to break, looking at the stocks, still rallying up 165 points we were up more than 200 at the start of the hour the s&p 500 going strong every sector is still green,

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schultz getting grilled before a senate committee in a hearing over the company's union and labor practices. our kate rogers has be( listening in and joins us withe■ highlights hi, kate >> hey, carl good morning, former starbucks ceo howard schultz facing some tough questions from senator sanders and other lawmakers as he testifies before that senate committee this morning sanders really blasting starbucks and says despite the movement of unionization going one■ for more than a year with some 300 stores agreeing to organize, zero contracts have been signed so far w (t&há■p &hc% under law, the two sides do have to negotiate in good faith, but don't have to agree to a

contract take a listen to what's going on >> mr. schultz, will you commit■ right now thatq■ within 14 daysf exchange proposals withp,■ the union, something it has refuseds thatf■ meaningful progress can in good faith. will you make that commitment? was made byxd■the union in buffo toç■ negotiate one single storet a time, we have met over 85 times for a single store separate meetings. we've said publicly and i say it q&ia face-to-face negotiations iso■r way to proceed and the reason i want to make that poirv■■is that therexd■have been safety issues in which outed on social media, there are privacy issues, we don't want to

do it on zoom.j■ we are prepared to mee4ñ issue. >> will you make a promise took this committeee■x■ that you will exchanget■ proposals with the union, so that we can begin tr■ makeq■i■ meaningful progress >> on a q■single-store basis, we will continue to negotiate in good faith >> so once again, you can hear schultz saying they'll do this on a single-store bas)$■ that's how the union wanted toxe organize, that's how starbucks plans to proceed with these there are two panels today, workers from starbucks, workers united set toe1 testify later today. we'll continue to bring you updates. >> kate rogers, thank you very much good to seer well, amid af■ murky outlook for the federal reserve and rates, investors are searching for places to put th+■p cash to work, while still keeping it safe sharon epperson joins us nowñ■q■ withf■ some ñ■ideas. sharon >> well, you know, sarah, when you look at the national average,e■ savings account rates are still pretty low, less than 1%, half of 1%

even a ym■one-yearp■■■cdy■ willy give you a return of aboute■ 1. on average but you can get much higher rates if you shop around look at online banks and credit unions the bp■■rate on a high-yield bank can topr and that annual percentage yield or apy is the rate you can earn on anxd■account over a year andt in'■á■es compound interest rates on cdoks can reach 5% at some online banks and credit unions as well, dependinge1e1 ow long you hold the cd for the highest rates, often,çó■ you'll need>4■ have a minimum balance ofñ■ $1,000. to know where too■ put kowr mon, determine your goals what do you planr money@:÷ and when do you w ■t tn spend it those should be the driving gives you a guaranteed rate ofx■ return and you have immediate access to your money it's a great way to build your emergency fund a cd will tiequp yourt(■money f months or years, depending on the duration of the o■certifica, and if you need the cash in the next few years, it probably c■ì% should not bet(■in the stock market or other riskier

investments. deposits are insured and protected. keep your money safe, fdico■ for banks, cipc for cash in a check those limits and check if there's a minimum balance or any fees to way theñi■perks against the penalties. "squawk on the street" returns right after this

i'm carl quintanilla with sara eisen. setting the agenda today, wilmington trust why she's leaningçó■into growth why tech has baked inxd■more bad news than its peers. >> uplus, an exclusive int with general millsu■■■@■á ceo, harm oning >> and laterq■ on,l■ç■ alan ratr pending home sales rising in 5a■ february, but down 21 year on5a■ year pretty interesting housing data thise■ week. >> take a look at stocks, starting off pretty strong this morning. every sector is higher today it is being ledi] by technology, but also strength in materials and q■energy the nasdaq comp up a full