world. the world would not exist without the element of carbon. that's what we're made of. it is thursday, april 6th, 2023. "squawk box" begins right now. good morning welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. let's take a look on this thursday of what we're seeing with the equities picture at this point futures right now for the dow up 16 points. s&p futures off 6. nasdaq down 75 the week so far has been a good one for the dow. it is up .60%. nasdaq down 1.8% the s&p is off by about .50%

treasuries have been the real picture to watch all week. yesterday, the 10-year treasury was at the lowest yield since september. today, it is at 3.29 you are looking at the 2-year treasury at 3.746. a lot riding on tomorrow we get more data on the jobs report today with the weekly jobs report. tomorrow, we get the key monthly jobs according to dow jones industrial average, economists are expecting 238,000 job added with the unemployment rate staying at 3.6%. tomorrow's a market holiday, but "squawk box" will have special coverage at the report at 8:00 a.m. we expect to see you there >> we have a little bit of a holiday. we get to sleep in. >> i'm sure we will be up at 4:00 preparing for the jobs report >> 6:00.

>> i'm pushing everything back two hours. 5:30 alarm clock which is sleeping in. it really is sleeping in i think it will be like all -- if you add up all viewers from 6:00 to 9:00 they will all be here at 8:00 a.m. the nielsen boxes will break it is like a tesla 0 to 60. costco reporting the first monthly same s-store sales drop. overall sales fell 1% last month. executives are saying falling gas prices and foreign exchange weighed on the results shares of costco down $9 it is a high price stock it is under 2% okay i'll give you that lower gas prices and foreign exchange

doesn't mean anything. doesn't mean the economy is slowing. doesn't mean the fed needs to ease up. doesn't mean anything. costco first drop in three years. lower gas prices foreign exchange concerns. it is interesting. we will see what happens especially if they trade down. >> walmart said recently they have not seen any changes. >> i know sometimes you hate it when i tell personal anecdotes charmin. i do i like charmin i don't buy a lot. i buy the six pack i did not trade down a little thing of charmin costs $18. i do my own checkout the person at kings said you need to go to costco you can go to costco and i could get ten times as much. it is a trade down

costco if it is a trade down, why do they have a sales drop do you know? do you have any comment? do you use toilet paper? do you know anything about it? do you have a preference >> i don't >> if it is really crappy toilet paper, you don't like that it doesn't work. you don't want to talk about it. >> i don't have a preference >> you don't want to talk about it >> i don't >> thanks for the mental image >> i splurge on good toilet paper. thank you. >> it is not for my use. >> quid pro quo. >> quid pro quo. you have to -- >> let's talk tesla. tesla is bulking up the work

force in austin. they tripled the number of employees from 3,500 to 12,000 last year. according to the agreement with the local economic adevelopment with officials, they are keeping up with the agreement. and elon musk is laying out the world without fossil fuels changing to clean energy would require $10 trillion worth of investment and continuing to rely on fossil fuels would cost more bloomberg reporting that tesla's master plan is providing more details from the investor day. the solar panel factories would be required in the next 20 years to deliver the power generation and electric storage capacity needed to have carbon free energy musk says $10 trillion cost is high, but a fraction of the $100

trillion global economy and would be feasible when spread out over two decades this goes back, by the way f you remember when he first started his solar city -- i was going to say tesla was one piece of it. solar city they merged them this is all one piece. >> a lot of partnerships between governments and private equity >> i bet you will see $10 trillion of investment i don't know in 20 years this is where it's going. >> it will take help he has benefitted from the help up to this point he needs more help >> government subsidies and tax incentives >> it is the same day that exxon is not finding oil in brazil they spent a lot of money trying to find it basically saying never mind. $4 billion they spent. each welcomes l comes up dry

we didn't run out of stones in the stone age. there is a finite amount people have bets that have not paid off they still parade the guy out. we will run out of something remember peak oil? that never happened. they were sure the guys that were promoting it are all dead it has been promoted so long that never happened. a lot of oil left. we probably won't run out by the time we do that. >> we had dan on yesterday talking about carbon capture he said it is not feasible in the beginning without government investment you start the flywheel >> to get it rolling i guess we can work on fuels for jetliners. >> we have to work on fuels for jetliners. you will not have solar powered

planes not any time soon, but not any time ever. >> if you can't go vast d distances, we don't have the same world we have now. michael paul was appointed to run the unit in january under former president bob chapek. joe earley is now helping launch disney plus streaming service. >> what does that say about moving from him hulu the questions surrounding that >> i still don't know if you will sell the thing. i think it goes back to what you think hulu will be if it is not part of disney. >> a shell >> i want to know what can i hang my hat on

no more cable with cord cutting? stream or not streaming? will i stream five years from now? are my cords cut >> you will enjoy entertainment. >> us being on peacock and a whole new group of people have ak access to us >> never cords >> such a thing as a never corder that's amazing the world's moving fast. too fast for me. i need to catch up i'm trying the chairman of disney's marvel entertainment group has parting shots for the magic kingdom. ike perlmutter saying disney fired him because he clashed with the executives who returned bob iger wants to empower.

his relationship with mr. iger and missteps he feels disney made in recent years he acquired marvel out of bankruptcy and sold it in 2009 he is one of the biggest shareholders with 30 million shares. >> it is worth the read. coming up on other side of this, washington and beijing clashing again was warning over house speaker kevin mccarthy's meeting with the taiwan psintrede you are watching "squawk box" and this is cnbc >> announcer: this cnbc program is sponsored by baird. visit bairddifference.com.

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france's president emmanuel macron meeting with chinese president xi jinping earlier this morning wow. that must have been early. it's incredible. that meeting coming as xi prepares to sit down with macron and european commission president ursula von der leyen china reacting to the kevin mccarthy meeting with taiwan's president. we have eunice yoon with more. what time is this there, eunice? >> reporter: we are 12 hours

ahead of you >> 12. i know that. i know that. >> reporter: yeah. there has been a lot that happened today one of the things that we saw today, of course, was the chinese reacting to speaker mccarthy as well as taiwan's visit in california as you said. beijing described it as acts of collusion. the tsai meet up with mccarthy and other congressional leaders is seen as the political licenlicens t -- mpolitely sensitive meeting t nancy pelosi had a visit last summer taiwan had a drill which ended

in a simulated blockade. so far, what we have seen is quite muted. several departments coordinated statements they used boilerplate language such as firmly opposed the discussion eh the chinese military also said they would have a three-day patrol in the taiwan strait. one of the things that people were discussing was this would also include possible ry a stopg ships and asking to board them the taiwanese authorities said no ships have had complaints taiwan's defense ministry has also said it spotted a chinese aircraft carriers as of wednesday. they are tracking it the "uss nimitz" is in the area

as well. a lot of speculation as this may be joe, you mentioned president macron is here that is one reason that people thinks china wants to present itself as a peacemaker they don't want to disrupt itself when they are tying to court the eu to potential ly alig align with investment from the eu the other reason why china may be looking to have a quieter response is because it is coming at a time when the economy is not doing particularly well and they have been trying to drum up business from the u.s. especially u.s. invesinvestment it may not be the best time to have an aggressive situation around taiwan unnerving executives guys >> eunice, it was three days

ago. even nbc news reporting real-time info from the balloon. sensitive information about military installations in the united states with the balloon flying figure eights to hover over military installations. you can't believe anything it is not a weather balloon. none of that is true any outrage over the meeting with the speaker of the house. no accountability for this did that make its way into the media reports in china eunice >> reporter: the way it is presented is the chinese are dismissing the u.s. concerns and saying the u.s. is acting in an exaggerated way and it is a balloon which is a weather balloon and there is no more to say about it from the chinese

perspective. it tells us there is concern that the u.s. and china can't communicate on some of the isissu s which you hope would not be as big issues >> talking at each other and it is dangerous i don't know what it means for the future eunice yoon on a windy day in beijing. see you later. > >> for what it means on the u.s. and china relationship is dewardric mccneal. what does this mean? what are your snthoughts >> andrew, what is important about the meeting yesterday is what president tsai's message was to speaker mccarthy and the delegation

it was about holistic resilience, andrew for tsai, she wanted to make clear that china anhas a numbero ways to coerce taiwan. not just see ships and planes and missiles, but cyber and political and diplomatic and psychological warfare. tsai wanted to bring home the message that taiwan needs help with holistic resilience >> i'm curious what you think with the recent guests that suggest the u.s. may be trying to stir up more of a problem than there is on one side and on the other side, there's very much a real problem when you think about these balloons, spy balloons, and the like which side of this are you on? >> well, with respect to the

china and u.s. relations, this comes to the floor from the trump administration those of us who have been watching this issue, this has been going for some time with respect to taiwan, this is increased aggression that we have seen since xi has come to power. the u.s. has not stirred up as much as anything as is the case to china and the world that the u.s. will do its best to try to maintain the peaceful status quo that exists across the strait. >> i guess the question is long term for the economic relationship with the u.s. and china -- is there a way to have a relationship and deal with taiwan how do you deal with the rhetoric part of this has become rhetorical at the moment that is where things stand at this moment. you could say there is something clearly underneath it all.

>> we had periods of heightened rhetoric and activity. we managed since 1979, really, to navigate this relationship. there are different dieynamics o as china thinks it is able to force a solution on taiwan so this is not going to be easy to navigate. we have done it in the past. all three parties in this cross strait dynamic managed to keep this from going hot. i think long term, andrew, the volatility and instability will increase because the power dynamics have increased. >> when you look at the companies, publicly traded companies in the u.s. doing business in china, do you believe the ultimate risk with china saying you have to get out of here and we're not doing business with you or the u.s.

says you have to get out of there because we're not doing business with them >> this is a good point, andrew. i'm not convinced that enough of the risk premium is factored in if you have any sort of exposure in china or any sort of exposure in taiwan. taiwan businesses, for example, will have to make a decision of how they de-risk their supply chain. foxconn and tmc are heavily dependent on chinese markets there is a lot to do here if this continues to go in the direction this is going and businesses have to take this risk seriously >> dewardric, andrew brought up an interesting point there are probably sectors that point fingers at the u.s. in terms we're not perfect. obviously, we're not is it a moral eequivequivalency?

we respond -- the finger pointing we do at china. they talk about our human rights in the united states is it equivalent i feel we're on the high ground on almost all of the issues with china. am a just a silly american >> joe, i think you raise an interesting point. i hear this moral equivalent argument all the time. i guess the point for me is what is the pact with your people how do they prefer to be governed what we're seeing time and time again is here in the u.s., we have the ability to push back and protest and voice our views about how we're being treated. that same right does not occur with respect to china. you know, again, i don't like everything we do, but we do have

a process by which i can come on the air and talk to you freely about it and protest if i wanted to do that that same right does not exist in china >> and taiwan, former speaker pelosi, i'm not sure we should turn a blind eye at this point whi china, anything we do, oh, my god, we told you we will eventually bring back in the fold. >> speaker mccarthy and both sides of the aisle, this is clear this is an issue the bipartisan show of support which we saw yesterday speaker pelosi made a supportive statement of speaker mccarthy. that is saying a lot in this town there is bipartisan support for

taiwan i just want to make it clear again that it is more than just the military exercises or coercion china is doing a lot of things that we cannot see to try to bring taiwan to heal she wants the u.s. lawmakers and policy mmakers to focus on other areas. economic to be one of them to bring about more resiliency. >> okay. great to see you thank you. >> thank you, andrew >> look forward to seeing you again. when we come back, the b backlash to tiktok on capitol hill is not stopping advertisers from flocking to tiktok. that's next. reminder, you can get the best of "squawk box" in our podcast. follow squawk pod and listen any time check it out here with the code on the screen. "squawk box" will be right back.

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tiktok still getting more ad dollars despite the security concerns from the app. the financial times reporting that advertising on tiktok in the united states grew by 11% in march from companies including pepsi and doordash and amazon and apple. data coming from analytics group. for now, you might be worried about this in washington, but it is not keeping the crowds ortizortiz orortiz -- crowds or advertisers away. we have that discussion next

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welcome back to "squawk box. we will get the latest data on weekly jobless claims and tomorrow is the jobs report at 8:30 a.m according to dow jones industrial average, economists are expecting 238,000 jobs to have been added. the unemployment rate at 3.6% steady for perspective on the data and how the markets reareact, we br in gabriela santos and veronica clark at citi. veronica, i have to start with you because i think your job is tougher the last few months

figuring out where the economy is headed. what numbers do you look to or other cater -- other indicators that you look to >> it is tough to predict. for the unemployment data we get to tomorrow, the best leading k indicator is the jobless numbers this morning we will get revisions this morning. the fact those were still low in march, i think means we see another increase in employment in march we are forecasting 250 tomorrow. the unemployment rate may fall back to 3.5%. >> we had people like barry sternlicht saying the fed is not getting the most up to date numbers and rent is rolling over more quickly than the official numbers they are tracking. obviously, there are concerns over what is happening in the banking sector and what it means

with a potential credit crunch or contraction and how that impacting the economy. how are you managing it? >> on the banking concerns , we have weekly data from the fed. they have it more timely than we will we get the fed zone balance sheet and bank balance sheets which is delayed a week. we are watching that data. there is some deposits leading us, but not substantially. it seems like the last couple weeks things died down a little bit. we would expect there is tightening in lending because of this you see credit contraction and pull back in lending maybe later this year, i don't think you will see that effect on activity data right away. >> full speed ahead with the fed as far as you're concerned >> it is a tough position for them we are certainly watching some signs in the data this week for march that may be activity slowing a bit.

we had softer ism readings we are watching that for the fed, i think the biggest issue is the next couple months of inflation data is still strong it could be really hard for them to pause on that scenario. >> gabriela, you have to figure out what the economy will look like, but the impact on the markets. good luck. what are you thinking? >> as we have been discussing the data has been noisy here at the beginning of the year due to seasonal factors and the benefits for consumers overall, the message we're getting is the economy is already slowing going into the banking stress and that situation is going to have lingering effects through further tightening in credit standards which had already been happening going into this. as a result, it moved from a crisis for the economy into more of an additional break into growth what we see for markets is the

bond market had already firmly moved on from the inflation concerns of last year to recession concerns we had yields fall substantially this year already 60 basis points year to date on the front end. 50 basis points on the long end. our message has been capture the yields while they are still at the levels and use core fixed income as that recession hedge you can benefit from the higher coupon and capital appreciation. the ultimately, the message is step away from cash we are believe we are peak cash levels we can lean into interest rate risk once again. >> okay. is that more of a call on thinking rates are going to come down from here because the fed won't continue raising because

of the economy is that a call that stocks aren't necessarily going to drop significantly from here? >> it is really a call that we had already seen the economy slow and that recession probability was high now we had the banking stress and that is an additional way we can see it tightening in economic activity. as a result, the fed is nearly done with its rate hiking cycle the. it not done already. as a result, the bond investors are already moving to the next phase which is cuts. pricing in three by the end of the year and additional four to five in 2024 and into 2025 the bond market is very clearly on rate cutting and recession risk mode. that is our main message as to capture yields and use core fixed income as the recession hedge.

>> veronica, one question. the jobs report tomorrow there have been layoff announced that have not hit. it will hit at some point. if the jobs number is weaker, would that change your mind about the fed necessarily raising rates next go around >> yeah. certainly there is a number that is weak enough that can change your views for sure. the pace of employment has been strong you have seen some of the layoffs showing up somewhat the last three months with information sector employment which is a lot of the tech companies decline by 50,000. partly what could happen is that there is still a lot of labor demand we saw job openings falling because some of those are filled with laid off workers. i would say there is momentum. there is always a number that could change your minds. it is every data point which is important at this point. >> veronica and gabriela, thank

you. reminder for you "squawk box" will have special coverage at 8:00 a.m. eastern time tomorrow. a day off for the markets, but not for the jobs report. we will be here to make sure you get that information as soon as it hits. we are now on peacock. >> that's right. >> if we're going to be promos and teases >> the morning news hub. if you turn on peacock in the morning, there is a big easy way to click through to it >> anyone can do this? streamers can now do this? how do we reach people right now that don't have cords? i'm talking to people. how can we tell them >> there is always door-to-door. >> that was a problem -- remember katrina hold on. help is coming

they had no electricity. >> i do remember coming up, going direct to the source the great length automakers are going to great length for the ev boom that is coming up on "squawk box. >> they send an email telling us the email is down. >> announcer: currency check is sponsored by interactive brokers. the best informed brokers is interactive brokers. how's the chicken? the prawns are delicious. oh, i have a shellfish allergy.

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ford recently announced its teaming up with brazilian mining company to secure nickel from indonesia for electric vehicle batteries. it is part going directly to the needed pippa stevens joins us with more >> good morning, joe we see more agreements with the miners as automakers look to secure battery minerals. we are talking about lithium and nickel and cobalt. those go into the battery. the map from the wilson center shows reserves you see lithium deposits are in chile and australia.t is

cobalt the majority of the congo and some in australia. australia and indonesia are nickel producers while these minerals are all over the world as the next map shows, refining and processing is concentrated in china that is one reason automakers are working with the miners directly they want to move away from independence it can help with exposure to the price risk with the lithium rally. there is a warning we won't have enough of the minerals ford has agreements with bhp and ioneer amongothers guys. >> i appreciate it. when we come back, lawmakers meeting with executives talking about china and potential threats. we talk about what is on the

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welcome back to "squawk box. members of the house select committee of the chinese communist party will be meeting to zdiscuss threats from beijing what are you expecting from the meeting? >> oh, man. >> what are they going to say? >> i spoke to a source close to the committee and just tried to lay out the agenda, what's going on here. so, today is this huge conference happening at stanford university, kent walker, chief legal officer of google, brad smith, the president of microsoft, we're going to see the cto of palantir and it is

going to be just a slew of -- it is like a tedtalk of what is going on in china and tech we're going to have brad smith expected to talk about ai and rare earth minerals for some reason i don't know why microsoft is involved in that but we have -- we meaning america, has a huge dependence on that. in the morning, it continues at stanford and they're going to talk about crypto and then they move over to tcupertino to talk to tim cook about the issues there. that's the testy one, considering what they're talking about. >> is it going to get contentious like it does when you call everybody before the hearings especially on an issue where there is bipartisan support where they think china is not a great position. all the companies have extensive ties to china, saying here's why this is important, or since the cameras aren't there -- >> the position i'm hearing from the committee, though, is it sounds like more antagonistic to apple because of their alliance

with china one that was pointed out to me, last fall there were protests at foxconn. we saw workers trying to get out the factory because they didn't want to be worked in and apple didn't say anything about denouncing the violence. tim cook has been asked repeatedly about this issue. literally silence from the company. i'm told that is going to be one thing that comes up. what this committee doesn't want to see is a compromise in american ideals, american values to make a quick buck in china. that's kind of the theme of today and tomorrow >> what about a long buck? >> a long buck. >> what about a -- not a quick buck, what about being there for years and years? >> which, by the way, apple has been doing and they're trying to decrease their reliance in part because of what happened last year. >> it is impossible. it is a conundrum. >> how much pressure do you think an apple feels from china on one side, but in truth, from the u.s. on the other? >> right >> meaning, who's pushing them effectively away from china? you know what i mean

>> in a way, china is because of what happened last year. they -- with those extremely strict covid lockdowns, that hurt apple's bottom line sales were down 5% in the holiday quarter. they couldn't sell their most expensive phone to people who wanted them. they had to wait until after christmas. they learned the lesson the hard way. now we're seeing cracks show in that supply chain, and we're seeing tim cook and his deputies go out to india, go out to malaysia, go out to vietnam, how can we alleviate the pressure -- >> five years from now, how much do you think the manufacturing of apple will be in china? >> i'll tell you what they're targeting and indian officials have said this, they want, for just -- let's talk iphone for a second, they want 20 to 25% of all iphones made in india. >> i'm sure india wants that. >> of course india wants that. they're trying to attract all this investment and jobs as well. >> if you were sitting here five years from now, what percentage of iphones are manufactured in china right now? >> 90%

>> 90%, okay if we're sitting here five years from now, what percentage of iphones will be manufactured -- >> they would like to see it closer like 80% or 70%. >> apple would >> yes >> it is about what you -- it is what you can do. let's go back to india that's one of the countries that has a huge workforce that is capable of doing it. they have regions there that are for manufacturing. tim cook even said they see india like china was over a decade ago and we know how they took advantage of that growing middle class in china, they took advantage of that huge labor force there in order to manufacture phones, they are going to attempt at least to re-create that magic in india. >> thank you, sir. >> of course >> appreciate it >> thanks, guys. >> great to see you. so, coming up, are the expectations for tomorrow's employment report too optimistic steve liesman is going to lay it all out for us and hollywood is enjoying a string of hits at the box office

so is this the rebound that investors have been waiting for? we have got a sneak preview as we head into the weekend long holiday weekend too "squawk box" will be right back.

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good morning, everybody. weighing the health of the job market investors in a holding pattern ahead of tomorrow's jobs report. the health of commercial real estate amid trouble for regional banks we're going to be hearing from commercial real estate pro bill rudin. and can movies level up profits for investors? we'll go behind the scenes and find out which companies should be in your portfolio the second hour of "squawk box" begins right now good morning welcome back to "squawk box" right here on cnbc

we're live at the nasdaq market site in times square andrew ross sorkin with becky quick and joe kernen look at u.s. equity futures at this hour. a day ahead of the jobs report that we got the dow up marginally, a little over two points nasdaq down 37 points. s&p 500 off 2.5 points as well treasury yields, 10-year note and 2-year note, standing right now on the 10-year, 3.88 oil, looking at 8034. and crypto, under $28,000 again, at $27,855 >> tomorrow is jobs friday and while the markets are closed for the good friday holiday, "squawk box" will be here to bring you those numbers. we start at 8:00 a.m. eastern time ahead of the number at 8:30 steve liesman joins us with a preview of what to expect. and, steve, this is big enough that we think we need to be here for it >> of course we need to be here.

i don't know where else we would be, becky. the job market forecast is forecasted to have slowed in march. some of the high frequency indicators we look at suggest that wall street consensus could be too optimistic. here's the numbers that wall street is looking for. 238, down from 311, and down from the plus 500,000 in january. unemployment rate, though, remaining unchanged at 3.6 average hourly wages shifting down again from the 0.5s and 0.4s, but up a bit from march -- february, sorry. but, the hr software company homebase writing a once hot economy is showing signs of a slowdown core indicators have shown none of the seasonal growth we have seen in prior years. here's what they're talking about. data shows the number of employees working shifted down compared to february last year you can see in that blue line the homebase data

didn't show any dip at this time of year. moving on, the monthly data from hr software company ukg also suggests payrolls will ease, big month on month drop since december its data doesn't line up all that well within the exact number in jobs, but it does do a good job of picking out the trend right there. and looking at all the other data that we saw this week, those less well known data lines, they do line up, they show this downshift, ism services, it was lower than expected, manufacturing, and there is the adp reported yesterday. and tjolts survey coming down much faster than previously had been expected. okay, the bls data, higher than the consensus for 11 straight months by an average of $100,000 100,000 jobs as forecasters keep betting the job market is going to slow because of the higher rates from the fed, which is saying that

taking the under has been a terrible bet but it suggests it could be a weaker number and maybe weaker than forecasts >> all right, weaker than forecasts, and that leads me to the next question, would this be the time when economists and others start reconsidering obviously the bond market is already there. they think that the cuts are almost done, if not done already and that the fed is going to have to reverse course if we get a weaker than expected number, due to holdouts, do they jump on board with that theory >> you mean the holdouts when it comes to the economists who thinks the fed is going to keep raising rates? >> yeah, we just had one on in the last hour. >> here's the thing, becky, the -- how do i say this the right way? i'll say this the way i think about it and tell me if this is too crazy. i don't think the fed necessarily cares about jobs i think they care about inflation. if the unemployment rate was 3.2% or 3%, and inflation was

under 2%, i think the fed would be a little nervous there, that's a little bit of an extreme example, but all of this has to come through the inflation channel that if indeed the job market is going to slow, they'll be looking at the wage growth, looking at the rate and they want to see the job market shift down because they believe that's a root or important component in bringing down inflation. so, i think the economists will get on board, becky, when you see those wage numbers come down and you get rid of that concern that powell has about inflation in the service sector. that's when they'll come on board with the idea that the fed could potentially be cutting i think you point out -- >> wait. >> go ahead. >> just -- i mean, i hadn't thought of it that way, that's making me rethink. you're saying basically powell and company aren't going to cut until they see the whites of inflation's eyes, you need a lower inflation print before they believe it.

don't think they'll be in the forecasting business of looking at rents that don't show up in the official numbers they're watching, don't think they'll be looking at lower employment, don't think they'll be looking at the credit crunch and factoring how that works into inflation, they want to see the lower print before they do anything >> yeah. and i can hear that your influence by what barry sternlicht was saying yesterday and -- >> go ahead. >> i was watching that great presentation he made, becky. i know the fed knows what barry presented there yesterday. and this is by way of backing up your point here, becky here's the thing the fed knows those rents are down right now they know that it is not showing up now in the cpi. and they know it will eventually show up in the cpi how do we know this? powell himself said this several fed officials have said that the lower inflation and housing numbers are going to show up in the data in the months ahead but you're absolutely right.

the fed i think has been burned a couple of times by inflation that looked like it was coming down, and then it popped right back up. so i -- it is a cliche, but to say that they're on this -- the whites of their eyes idea about inflation that is 100% accurate i think right now. not a lot of forecast in there. >> so, you look at the 10-year and yesterday at the lowest level since september of last year, you got the 2-year back to below 3.75%. >> yeah. >> the market is acting predictively, i guess, as it always does, and maybe that's the rub you're going to see these two kind of colliding like two fault lines for a while before anybody kind of wins out? >> i'm going to challenge the guys in the back, my good friends back there fed market gap, which is something we have been doing, which is measuring exactly what becky is talking about and what we do is we look at the fed's own forecast, becky, and

compare that to where the market is priced for the year-end and i can tell you right now, it is 107 basis points. it had gone the other way, remember when the fed was more pessimistic than the market was thinking the fed was going to be tighter than the fed itself did. and that went the other way as a result of this banking crisis we had or banking turmoil we had. and it can close pretty quickly, becky, that gap of 107 basis points but it happened in february and the market fell about 5% or 6% when that happened right now, they're whistling past each other right now in terms of what is going to happen and what the fed thinks. >> whistling past an induction zone where the plates are pushing up against each other and eventually things will be calm again and will get back to shape, but not without some earthquakes and major upheaval along the way. >> they just -- they just have

different forecasts on inflation, becky i think everybody understands how the fed is going to react given a set of data. the data comes in, the inflation is higher, the market thinks, but the market has this idea and now more of this idea that the banking turmoil is going to create this credit tightening and that's going to mean less economic growth, less inflation down the road, the fed has not as far as we can tell at this point incorporated that. in fact, we had several fed officials the last several days say, you know what, we think we need to hike more. they basically said they do not see a big influence on their outlook for rates from what has happened with the banking sector >> steve, thank you. >> pleasure. dom chu with a look at this morning's premarket movers we covered fixed income, dom will you tell us something about equities and stocks? do you have something on your list for us? >> i do, joe, becky, andrew. to the inflation discussion you

were just having, i'm going to lead things off with a check on the consumer and one data point that might go towards kind of that big anecdotal picture we're talking about big box retailer costco. it is seen by some as a possible consumer bellwether. those shares are down 2.5% right now. just around 2,000, 3,000 shares of volume. not a lot going on yet it is important because it reported that sales growth at u.s. store locations that were existing, established already, grew by .9% in march if you strip out the effects of gasoline prices, that's like their core measure of u.s. comparable store sales growth so to speak, the reason why it is important is it is the smallest gain in those sales growth figures since april of 2020 just after the pandemic lockdowns took effect. is it a commentary on whether consumers are spending a little bit less next, i want to bring you shares of fedex, which are higher by a percent or so, around 7,000 shares of volume the package delivery company,

logistics giant is following up on yesterday's gains tied to the plans to consolidate its operations and today it is getting upgraded by analysts over at raymond james who say it is an outperform now with a $285 price target given the changes that could drive profit margin and free cash flow growth down the line those shares up 1.3% after gains yesterday. we're going to end with a couple of analyst actions on regional banks because they're important to the story these days in the markets. coming out of kbw. they're downgrading pnc financial to an underperform, given that it already had a premium valuation to the rest of the peer group they're also upgrading fifth third bank to an outperform, given its discount valuation so underperform for pnc because it has done so well valuation-wise fifth third gets upgraded to outperform the regional banks will be a huge focus given the turmoil we have seen, analysts are changing their views on what is happening with the banks, joe. >> cincinnati lender as you

know dom, you know what the elephant in the room -- you know why it is called fifth third? fifth and third do not -- it makes no sense. >> no. it was the combination of -- >> fifth national bank, third national bank, yeah, you're right. you know what the elephant in the room is, i guess we're not going to talk about that, are we >> i think there might not be enough time to talk about it but i will say i tweeted about it i'm giddy. i got my ipad set up on my desk. you know what's going to be streaming on there this morning. >> "squawk box" on peacock >> yes, on peacock i can watch the "today" show, "morning joe" as well. >> do you think tiger finishes in the top 20? >> i think he does i think he's got it in him i'm biased. >> increased odds for that. >> i'm a tiger fan i've been a tiger fan for years. >> i know. and you -- we used to -- we used to bet either tiger or the rest of the field that's how good that guy was even odds for either tiger or the rest of the field.

he's still got it. i don't know i don't know >> here's what i would say i think -- i keep pulling for rory this would be the career grand slam for him he would win all four majors of his career if he could get the green jacket this time around. his game is right there. rory is my favorite. >> let me ask you this, does rory, spieth, cameron young, and brooks koepka, do they all make the cut? >> do they all make the -- i think they do. i think they do. >> i can double my money on that. >> you got six liv players that are masters champions. this will be a fun one to watch. >> okay, thanks, dom >> you got it, guys. >> coming up, moviegoers leaving their couches for the theaters will it level up the profits for investors? we're going to talk to rich greenfield about the companies behind the silver screen before we head to the break, take a look at the markets, dow up 12 points, s&p 500 off just marginally nasdaq down 25 points. we're coming right back.

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is the box office back to its prepandemic levels this weekend, universal super mario brothers movie opens in theaters it is expected to make $125 million. universal is owned by cnbc's parent company comcast we also saw big opening weekends last week with paramount's d

dungeons and dragons and with john wick chapter 4. investors are wondering what it means for the current state of the movie industry and on the streaming side, disney and netflix stock both down in the past two months. they struggled to get their streaming film divisions under control with lower costs and fewer outputs. joining us now, rich greenfield, lightshed partners could you put -- take your shirt off, stand next to keanu reeves, do you feel kft confident that u can measure up there, rich >> you know, joe, i'm turning 50, i'm getting close, but i'm not on the other side of that quite yet. >> 58 for keanu reeves and he's supposedly still a bad ass he wins all the fights in "john wick 4." >> tom cruise does all his own

stunts >> tom cruise does all his own stunts at 60 what are we at how many big releases? we're still, what, 33% down from the best levels? >> i mean, look, individual movies are certainly getting back to levels that we saw prepandemic. like, there is definitely desire to go to movies to see great films. and i think you're going to see that this weekend. i think illumination has been crushing it over the past couple of years and you'll see a big turnout for "super mario" this weekend. despite all the -- you went through a bunch of movies that came out in march, march was still down, high 20s, 25 plus percent versus 2019. the prepandemic 2019 so, sure, things are much better, individual movies are actually performing. there is still a lot less movies being released that will start to change as we go through this year with an overall volume of

movies picking up. but i think the one thing that people aren't talking enough about is that it has been very binary coming out of the pandemic movies either work or they don't. we're seeing a lot of movies really struggle at the same time we're seeing a few do really, really well. that's why i think overall box office is still at a substantially lower level than prepandemic, consumers are being choosier about what they go to see. >> interesting because the demise of the movie theater and going out to see a movie, that was greatly exaggerated. but it better be good because if you got a big screen at home and there is nothing that is really drawing you out to amc or something, then -- so that is a difference that is a probably a different environment that maybe we never -- do we ever get back to where there are enough movies to get you out to the movies? because they're not going away, the movie theaters, i love the experience it is the movie studios' fault

that they're not doing better. >> well, i think also consumers are actually -- there is more competition for that consumer time spent and i think with social media, i think you're aware of what needs to be seen in a theater versus the home experience. there is so much incredible content now than we have ever seen before. look, just turn on netflix, turn on disney plus, turn on peacock, there is an endless array of movies for consumers to watch. you don't need to go to the theaters it needs to be something that really -- the big screen makes it a better experience and i think you'll probably get that with, you know, call it ten movies a year. not 20 or 30 or 40 movies a year box office is probably going to be down 15 plus percent from prepandemic levels going forward. that's the reality the story that no one i think is really talking about, joe, that i find fascinating heading into this weekend is the animation crown has really passed over the last couple of years from disney

over to universal. and i think that story really isn't getting enough press in terms of just how weak disney's animation franchise has become i think that's bob iger's number one challenge coming back into disney is how does he restore that animation success that disney had under his prior leadership >> yeah, that definitely -- that definitely is not mentioned enough in the media. rich, in fact, why don't you say it again >> with the last three disney movies, what was it, soul or whatever -- >> yeah. >> just not working. they're just not working >> no small feat to beat disney at animation >> well, and i think what goes -- why this is important is animation is the life blood of the walt disney company. if you think about bob iger, animation was struggling the first time he came in. remember, what did he do, joe? the minute he came into disney, within six months, he bought pixar to basically reclaim it and take that title.

but he made that big acquisition. he then went on to make marvel and lucas films. but he quickly realized that animation success was critical to disney's future we'll see, i saw the elemental trailer came out during march madness over the last few days it looked okay i'm not sure that's the transformative big movie that disney is waiting for. meanwhile, you seeing some like super mario, which looks prepared to crush it this coming weekend. it shows you disney needs to get animation to work. i think investors are talking about creative success as what iger needs to do yes, he has to solve hulu, there is the espn issue, but the creative side of disney, the success in content is what investors are really watching for and i think will be the big turning point on how disney does over the next two years as a stock. can they get the creative back on track >> rich, just because we ask about hulu every time, any new thoughts about the outcome >> oh, god, i mean, look, i

heard people come on your air over the last week saying disney is definitely buying it. i heard people come on and say disney is definitely selling it. >> what would rich greenfield do. >> this is easy. you get rid of it. there is no reason -- i was over in paris for spring break, you turn on disney plus and you're watching the "dropout," "dopesick," all the content is built into disney overseas you don't need hulu to expand the breadth of disney plus. >> if you're disney, the right answer is to get rid of it irrespective of the bundle and all that people think the bundle is a complicated thing to undo. do you want to own this asset? >> i think it depends when you say do you want to own it, what is the asset you're buying are you just buying hulu are you buying hulu the streaming service? are you buying only murderers in the building, are you only

buying fx, with all the content like "the dropout. >> i can give you the answer you said that what made disney plus work internationally was the idea that they had "the dropout," and they had "dopesick" and other things. the answer is you're not going to be able to keep all of that content. so i imagine the answer is that content is licensed on hulu for some period of time, three, four, five years, i don't know then you have to effectively create your own, you have to back fill a lot of content and build your own there is going to be a massive cost on the other side that would be my version of how something like this would go down now do you want to own it? >> look, the two problems here, comcast is losing $2.5 billion and subscale in peacock. this is the quick way to get to scale. the content issues and the licensing you have to figure out, but it would jump start peacock into a -- it would really, you know, sort of think about the warped speed move in

terms of what it would do to subscribers and overall business, but you're right, andrew, what i really want to do is buy hulu and search light or hulu and, you know, the larger fx business. that might be more interesting and then the wild card is let's just say comcast doesn't just want to buy this we know disney has to buy comcast next year. the question becomes if disney wants to sell it and it is not comcast, who is it you know could it be a wild card like a microsoft? sure could it be a wild card like an apple? sure but none of that seems likely. and i think that's the problem that iger is faced with, he wants to sell it, i think he's hired investment bank to explore selling it is there a buyer if comcast doesn't want it? and that's the real trouble right now. >> and what do they have to pay, $9 billion or something? >> that's the minimum. that's only if we're talking hulu we're not talking about the content that is created by other disney divisions that theoretically in this

conversation you would have to buy searchlight or fx on top of that, which would be a much bigger number. >> i thought that the addition of "squawk box" already had lit the fuse on peacock. you're saying that it could be even more so with -- in terms of being scale with hulu. >> it is wwe and "squawk box" neck andneck as the drivers of peacock, for sure, joe i'm sure of that >> okay. all right. so you said some good stuff about universal animation and some good stuff about "squawk box. we'll see you next week, rich. i think, maybe the week after. thank you. >> all right when we come back, should investors be worried about the health of commercial real estate amid the regional bank trouble bill rudin will join us to discuss. we'll be right back. time now for today's aflac trivia question. according to the white house archives, what year was the

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"squawk box. shares of palantir coming under pressure yesterday joining us right now is roger montefort, good morning to you >> good morning, andrew. >> you were an early investor.

you're not one now but someone who understands and studies the company. we had a conversation with jim cramer about this company yesterday. i respect jim a lot. but we're probably on other sides of this. he thinks this is not a long-term great company. i look at it and think about all the things they have done frankly to help protect the the u.s. from terrorism and clearly where it has gone in terms of the corporate space. i'm curious where you land and how you think about both the value of the overall company in terms of what it does, but then as a stock as well. >> sure. thanks for having me you know, i'll say this, first i would like to at least just one through some of the numbers because, again, i'm with you, i respect jim, i like him a lot. but i think some of the comments that he made were actually irresponsible when you really look at it you know, they did $1.9 billion in revenue last year they guided to over $2.2 billion in revenue this year

they have become gap profitable the last quarter they're going to be gap profitable for the full year of '23. they have free cash flow over $550 million over the last eight quarters and you're looking at $2.6 billion in cash in the bank. so, to classify this company as not being real, i think is just ludi ludicrous. they're every bit real you know, if you ask the u.s. army or ukraine or ask, you know, the folks at the cdc or different governments from around the world if palantir is real, i think they'll unequivocally say they are real. >> you own shares in this company personally your fund was an early investor before there are real questions about the long-term value, questions around dilution, for example what do you think of those issues >> i think, listen, dilution was

with stock compensation was definitely a big deal in the early stages when the company came public through direct listing. i think those questions and, you know, have dissipated since. this company has always been, you know, a very provocative company. and i would venture to say it always has been a misunderstood company over the years i've been an investor since 2014, i continue to be an investor and the reason, what attracted me initially to palantir is, you know, their product, their technology, their software it is -- hard pressed to find another company out there that can deliver the software they can deliver in the format they can deliver it to. when they first became public, the big issue was, can they scale it is it just this dark ops company, can they scale it and sell it commercially the answer to all those questions -- i think what jim

conflated was the investors that got behind palantir and then the underlying company you know, you can't chastise the underlying company for the type of investors that get behind it, right? >> roger, we have to run we have a chart up, i don't know if you can see it. this stock was trading at $40, if not almost $40 two years ago. it is at $8 now. as an investment, what do you realistically think about this company, if we have this conversation 12, 24 months from today? >> my window is five years from the time they became public. i think management has guided with a five-year plan. i think, you know, they have averaged close to 30% growth year on year since they have come public. they turned profitable in the time frame they said they were going to i think the value proposition long-term is tremendous for palantir i think it is a software that is critical, solving the world's biggest problems, i think it is going to continue to be a software that is at the forefront to solve those

problems in both -- >> is that -- i mean, for those who thought about either -- who are invested or thinking about investing, is this something you say to yourself is going to be a double to you, a triple, up 50%, 10%? >> i think -- i'll put it this way, you know, i would like to be on with jim in five years and write the price down from here and if it is not over a triple from this point in time, i'll eat my words. >> we'll hold you to it. roger, thank you for joining us this morning >> thank you, take care. the health of commercial real estate and the pressure on regional banks new york's commercial real estate king bill rudin will join us plus, follow squawk pod on your favorite podcast app and listen yte. stay tuned good luck. td ameritrade, this is anna. hi anna, this position is all over the place, help! hey professor, subscriptions are down but that's only

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welcome back to "squawk box. tech layoffs and wall street cuts crushing tax revenue in california and new york. robert frank joins us this morning with a look at the conundrum. maybe that's the polite description of what is happening here. >> it is a conundrum and is going to get worse california and new york seeing rapid declines in tax revenue. while the rest of the country is seeing continued gains california revenues down over

4% new york down 1% from a year ago. the rest of the states all up 11%. dan cliffton says the declines are partly due to the drop in tech wealth in the stock market, but the big worry is that withheld taxes, taxes from payrolls, are also falling he has three reasons for this. one, unemployment is rising in both states, especially among high income workers who, of course, pay more taxes bonus income is falling, wall street bonuses down 26% this year and wealth flight, that's the high income taxpayers who moved out during the pandemic, those are now showing up on the tax rolls. political pressure growing in both states to raise taxes on the wealthy. a tax the rich takeover of albany last week urged the governor to raise taxes on those making more than $5 million a year so far governor hochul resisting. the state is looking at budget deficits growing to $6 billion by 2027. california looking at a deficit

of over $22 billion. only six months ago california had a surplus of $100 billion, now looking at a deficit of it 22 this is getting worse very fast. >> this is the function of some of the government money that had been -- >> which is also running out. >> the other question is, when you look at the flight, you keep talking about the wealth flight coming out of states like new york down to florida and other things, what percentage of that conundrum that new york, for example, faces, do you think is a function of the flight of the wealthy, versus the bonuses coming down, the salaries coming down. >> no way to know. you see that the withholding tax from payrolls is down, you can't sort of see, okay, this person moved to tech. what we do know is 2021, 1400 people who make more than $25 million a year moved out of new york it was 2,000 people the year before those are super high earners that, you know, 14, 1500, 2,000,

not a huge number. but the dollar numbers have an outsized impact. that's a lot >> here is one other question. you can extrapolate this to federal taxes, can you you can leave california -- you can leave california, you can leave new york, go to florida, people don't leave the united states and go to monaco, do they >> the part that is extrapolated federal taxes and this is causing some people to say we may have an accelerated timeline for the debt ceiling because we're seeing low revenues is the capital gains portion from the stock market >> i know. but you can't make a blanket statement, higher taxes result in lower revenue when it is all said and done. that happens in states, you probably can't -- over in europe, in the eu, you can -- you know, you can -- it is easier to move out of one country and into another that's not the same here >> no. >> one state to the other. >> right but you can't -- we're not moving to monaco what time would it be if we did this show from -- four hours

later, wouldn't it >> i think we should get over there immediately. >> you know what is the most densely populated country? >> very densely populated. >> monaco. >> it is tiny. >> it is tiny. maybe that's why >> like a city thanks, robert. >> robert, thank you. joining us to talk more about it is former u.s. senator judd gregg he represented new hampshire as both senator and governor. also, former state senator michael jenaris of new york state. welcome to both of you michael, why don't we let you tackle this first, because robert's laid out a lot of the arguments and a lot of the concerns on this you actually are in favor of going ahead and raising the taxes in new york state. lay out why. >> that is correct there is not a former in front of my title. >> i know you're not former. still a state senator. yes, you're right. >> there is a lot of disruption that the years have caused in the economy. no question about it but a lot of these projections in my view are unnecessarily alarmist, you're talking about

projections four and five years down the road. and if i were able to predict or if any of us could what the economy is going to look like at that time, we would be a lot richer than people watching the show even are. and so, let's just take a step back and be sober about this the fact is that people have suffered, working people at a time when the wealthy have gotten historically wealthier. the covid years were very rough on working people throughout the country. people who have lost their economic standing. and yet the richest in this country, certainly new york state, have gotten richer. i heard the conversation about people fleeing new york. new york has more billionaires today than it has two years ago. some people leave, more people come in. and as long as we do our jobs right, what we need to make sure of is that we have the services in place and good work people, give them the lifestyle they want so they don't leave there is also a labor shortage of people. and we should be more concerned about the people who need that -- need those resources,

need the services to have a good lifestyle and a very expensive place like new york than worrying about the thousand people that left who were replaced by others. >> judd, i'll let you take a crack at that. go ahead >> well, i think it is pretty stupid politics in my opinion. you got to listen to margaret thatcher, the only thing wrong with socialism is that at some point you run out of other people's money to spend. what is happening here is the other people are leaving the states new hampshire has no income tax, no sales tax, no state tax massachusetts just put a major surtax on high income individuals, who are being overwhelmed with people trying to get out of that state and into new hampshire the problem here is pretty simple it is politics constituencies are the people who run these states, who are essentially -- they call themselves progressives, they're socialists they're built off the dependency and built off of subsidy

that comes from taxes put on people who are the wealth producers, but more importantly the job producers in those states and some people point those folks say, hey, i can't take this anymore, i can't create jobs here, i can't produce wealth here, this regulatory oversight and this economic excess in the area of taxation so i'm just going to move. and you can do it in the united states and the point is not that people -- high income people aren't undertaxed. the united states, 74% of the income tax is paid by the top 10%. it is an extremely progressive system and i suspect that's more in places like new york and california, though i don't have those numbers. this is just a simple of exercise in politics of -- my neighbor until my neighbor leaves. >> we have talked a lot over the years. i want to reform the tax code in all sorts of ways that would probably tax the rich in a more

meaningful way, but not necessarily from a state tax perspective, but from capturing folks who are, you know, paying 15, 20, 25% in total rather than those who are paying 50 and on their way toward 60% and because of this mobility issue, what do you think of that i know you're saying here that there are more millionaires than there were before, but i think and i'm curious what math you have on this i would imagine that some of those millionaires aren't just millionaires, they might even be billionaires in which case the amount of revenue we were capturing from them, i say this as a new yorker, was meaningfully higher. >> look, first of all, i wholeheartedly agree with you. i wish this problem were solved at the federal level we're living under historically low tax rates in the united states over the last 40 years all of the studies have shown that has not had a meaningful impact economic growth relative to a time prior to that when the tax rates were higher. yes, this should be solved more

globally the federal government has not done that. so those of us, the state level, have to make policy decisions as it impacts our constituents. your other guest is good at the talking points that have been handed to them by economists and the wealthy. the fact is to support progressive taxation -- i am no a socialist. i think when the united states is near the bottom of developed countries in terms of its marginal tax rate, there is room to create a better balance and the reason why -- >> the problem is that new york is the highest taxed state in the country at this point. >> just to back up what judd was saying, just some statistics on this, according to the irs, 300,000 of new york city's wealthiest who left in the year 2020 earned $21 billion in total income 41,000 filers, the top 1%, pay more than 40% of all income taxes. the top 10% pay another 33%. >> right, do we know why that

top percent pays so much because the inequality of wealth is so great. so, of course, if 1% is make all the money, they pay the taxes. >> michael, look, we might want to change the entire universe, that's the reality and you need that tax income. >> yes we certainly do. and we had tax income from the millionaires that new york continues to develop and recruit and have people come in. this narrative, i'm so sick and tired of it, about people leaving new york yes, people leave new york and people leave every state and other people come in that's been the story for as long as -- >> you can say up is down and down is up as much as you want but it still doesn't change it do you wish amazon, looking back at that, do you think that community is better off without amazon, do you still believe that >> that's a great question you mean the jobs that never would have come because they're firing people left and right are those the jobs you're talking about? meanwhile, if we're talking about tax revenue, we would have

had half a billion dollars -- for a project that never would have come. ask the people in virginia how they like the fact that -- >> the previous tax rates -- i guess you're talking about eisenhower years or something prior to some of the reagan tax hikes. nobody paid 90% marginal rates, probably 10% and the prior to some of the reagan. nobody paid marginal rates they probably paid 10% they say the marginal rates are too low. a lot of people above in the 1% pay more than 50% in taxes do you think they should pay 70% or 80% you think people should work till september or october for uncle sam until they take anything home? >> first of all, you know that's fictional, joe we're talking about only a certain point that everything goes higher. so it's not 70% of the total >> if you're above $400,000, it's every dollar past that. every dollar past that is at 50% or above >> what i'm saying to you is

there's room to grow, especially when the policies of the last 40 years have created an historically imbalanced inequality of weather. >> i'm sorry to tell you guys this but ronald reagan was wrong and it's time we figure out how to do this right >> here's the question, whether states should be the one -- >> the inequality issue you're raising i believe is absolutely real and i would love to find ways -- >> talk to the fed >> i would love to find ways to solve it this goes back to how you solve it and whether you think actually a state can solve that problem without hurting itself in the process >> that is the most salient question in this interview as i mentioned, i do think the problem ultimately would be solved federally but we are faced with real decisions we have to make on a state level and i don't think the answer is

to continue to let the wealthy get wealthy. how do we serve the wealthy in the best way possible -- >> unfortunately i'm deal with the reality. >> you have to look at people who are not at the top who are also leaving the state >> how do we keep those people here >> just to have an honest conversation -- wait a second, just to take some of the rhetoric >> judd is just sitting there. >> we're talking about expanding the economy and how do you do better for a state' economy. i agree with andrew's point on this but you're ignoring the other side of that if you raise taxes, the wealthy leave or the businesses leave, it hurts the economy overall it hurts the workers at lower levels, too, because the jobs disappear. how do you get more people to come back into the city? >> and if that were true, i would agree with you

except what the data shows is that the wealthy that are leading are being replaced and we're also dealing with some historical disruption due to covid. a lot of people who left temporarily are coming bank and we shouldn't be making decisions based on anecdotal feelings. if you can look at the one side of the coin of the -- >> judd, go ahead. you've been very patient >> i'm just happy this guy's in the new york state senate so we can get more people in new hampshire who are wealth producers and job creators that's the bottom line in our economy which is based on market economics, people are going to move around where they can be most productive and most effective in utilizing their dollars in dreeting wealth, which in turn creates jobs, which in turn creates tax

revenues this totally escapes the new york senator's adesystem but it's not unusual because he gets elected by people who vote through subsidy and dependency that's been a cultural fact in our state for years. the simple fact is that's a dividing line in our country it pretty significant in the way that states have managed to be economically prosperous and efficient. and new hampshire remains very prosperous, very efficient and very loaf tax. new york is inefficient, losing its prosperity and it's losing its people who create prosperity and that's a function of the people who think like that senator. >> judd, please don't talk about my district when you don't know anything about it. >> i'll talk about you if i want to talk about you. you're saying i'm reading some sort of -- i hope i get to speak in this show >> you have no idea what -- >> new york doesn't even let

people speak who disagree with them have you noticed that about the new york politicians >> i wasn't going to let you talk about me -- >> you don't want to hear a rational thought because rational thought doesn't play a big role -- >> that's coming from you so i guess we'll leave it at that >> well, that was fun. when we come back, we'll speak to new york real estate king bill rudin next. "squawk box" will be right back.

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welcome back to "squawk box. the regional bank fallout crisis -- >> the current real estate book for regional banks is almost $2 trillion the big banks are $800 billion, 900 billion. they are long cre. we know that rates are up, real estate values are down and there's no markdowns yet of scale. that's why this regional banking crisis i totally agree with jamie is far from over >> joining us with more, bill rudin, ceo and chairman of rudin company. bill, it's great to see you. i want to get you in on that conversation we just had about

new york with is unto itself a fascination. what do you think of what barry said and how concerned are you about not just these real estate books but really the regional bank sector at this moment >> first of all, great to be back in studio with all of you, my old friends >> great to see you. >> i think barry is spot on. there are definitely significant storm clouds ahead that's why the real estate round table sent a letter a couple weeks ago, i think you had scott rechler on to the fed, to the office of controller currency and other banking regulators to talk about what we see coming forward. there's a a trillion four hundred million coming down. banks are not lending, regional banks are definitely not

lending. how do we work our wave through what we know will be issues as some of these come do? >> especially among a class buildings but b and c class buildings, we have a conversation about what happens to cities and the commercial real estate in those cities. you've been very bullish in the past couple of years but here we are now with people are looking and saying actually this may be a little bit tougher or or maybe a lot of it tougher. >> no question about it, the bifurcation of the quality, the people are going to get buildings. the building right behind you, we rented to a major university, they have 300,000 feet it's incumbent on cities to continue to diversify its tenant

base, health care, biomed, media, entertainment some of these companies are growing we see experiences expanding. there is definitely significant vacancy in the bp and c and that's why the senator and his caucus and the governor and mayor are talking about conversions, allowing office buildings to be converted to residential. that's not going to be a silver bullet but it adds to the vibrancy of cities and takes inventory off. we did it in lower manhattan in the mid 90s, woo e went from 100 living in the city to 70,000 >> there's no question the city needs real revenue to provide the services that your customers and residents and clients need at the same time that you want to keep people here. in some ways you want lower taxes, right -- >> no question

>> that would make it more attractive to be here but you desperately need higher revenue. how do you do both >> you have to -- the mayor announced the other day budget cuts because of the immigration hit on the servicing those immigrants coming. that's a federal issue that shouldn't be a new york issue. we shouldn't have that burden 100% and state issue pup have to balance your budgets and make hard decisions like we do in business and make sure that you have -- >> in the short term you will have to cut to make the numbers work >> in any business, in any government you know that there's fat in there you have to look at each line item and come up with a plan to -- >> and how do you do it? >> it's not easy you have a mayor who understands it, who is taking aggressive actions. these are all tough decisions. >> let me ask you about business decisions you do know about. that's the commercial real

estate that's coming through, you said $1.4 trillion is coming due. what's going to happen if the banks don't loan we've had several commercial real estate people come in and propose some sort of a bailout or extension if you say extension, it is a bailout. this is help coming from other people to say, yes, we will cover for that why wouldn't we let those loans go and the highest bidder will win. >> i'm not sure the word bailout is correct. >> it is >> it's private support that -- >> it forces private companies or the banks orring somebody et t take >> what's the alternative? the banks get the loans back and get the loans. you'll neff get the markets back to liquidity levels. >> if they go on a fire sale and somebody steps in to buy them. >> but then the banks have to to market the ef equivalent debt

out there. >> would you buy stock in a regional bank right now. >> i probably would not. would i buy sok in ri te and i have more real estate -- >> >> would you keep your cash in a regional bank today >> we don't keep our bank in a can -- we are treasuries below 330 for the first time in several months because there's a flight to quality. i don't buy into your thesis you have to look and take steps to avoid that significant crash that will happen unless you stretch out these loans. it all about time. the economy will come back people are coming back to the city, people will create jobs. but if you don't have credit, then the whole system clams and i don't think that's a very

pretty picture for the future of our economy. >> who needs to act? the government needs to tell the banks -- if it was in the best interesting of the bank, why wouldn't they do it themselves >>. >> because of federal requirements, capital requirements. >> so at least release the capital requirements. >> to some degree. it's been done in '09, '10, '11. you have to look at ways to solve problems in a very different rirn and by solving problems, we've taught people it's okay to get riskier. >> who created that? it like having zor. >> the members of the business created that it wasn't like you didn't see what was going on. it's what you do with the environment. >> yes, but easy money, easy

credit requirements, those were symptoms of a federal policy that allowed cheap money for particular reasons it goes back to '08 and '09 and then covid >> it's like telling a dog don't chase that cat, be upstanding. they're going to do what they're going to do. >> when it turns and scratches you in the face -- >> you have to learn >> we try to underwrite on a conservative basis and do it with a business plan that makes sense, not some of these crazy deals. not just in real estate. and people buy in companies -- >> i think you would with and let the crazy deals fall apart, let that go. >> we also want to have loans to get done and find opportunity. >> i have one more

and we're over time. a lot of people after amazon pulled out of virginia or slowed down or temporarily halted that problem said, oh, aoc, they were right, they should have never let amazon so up in long island city to begin with what do you think of that? >> i think that's sort itsed we need those but this will be short term facebook meta grew 50% over the last several yeerg there reduction of workforce is not even going back to where they were in 2019 or 2020. they net still have more employees. will they eventually start hiring again yes, when the economy come back so, yes, we have to think of long term it was a miss

particular take and you if frng amazon is not going out of business they will be here and come back and grow that's what will happen in virginia >> one of new york's unofficial mayors we appreciate you being here >> don't bet against new york. >> see, told you >> let's get oaf to our senior commentator mike san tolly mike, what's up? >> checking on the state of this market, it's starting to clench up with all the economic slowdown data. however, becky, four years ago today is when silicon valley bank really broke and the stock started to collapse. the s&p 500 is up through p via is couple of percent this week the traditional areas like health care and utilities are doing better the s&p still so not really

showing that it in panic mode. the cyclical part of this market had been leading -- semi-conductors and home builders continue to be very strong this is over a six-month span. this and discretionaries, those have fallen away you're seeing essentially people pricing at a little more lower activity and maybe higher interest risks into thos you have small caps making new lows or at least threatening the delows and banks, the premium of jpmorgan versus the overall bank sector has gotten to an extreme in is a five-year chart.

when the market get very ver it's considered to be indispensable bank, the kind of balance sheet that's not going to be penetrable sometimes they both fall away, after the covid crash of course. sometimes it can correct high pam and it vastly more of the entire capitalization of the regional bank sector there as balance and maybe there's room for relief on the rank-and-file banks out there. >> you can explain the ten-year to people just rushing equality. i know that but i'm thinking eye rate cuts eventually by the fed. but even if it it i mean, that's

self-fulfilling for a slowdown and it could mean that they're spakting for probably hmm. >> or at least buying insurance against that possibility the bond market does not have perfect foresight. that's let it that way >> okay, thanks. we'll have much more on the markets coming up after the break. plus a debt limit showdown continues. continues. we'll lkta to ll congressma through the storms? "squawk box" will be right back. (thunder) how do we make our clients feel secure and- ugh... not lions. (lion rumbles) we do it with our people. people who've been looking after people for over 170 years.

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a little more than an hour before the hoping bell on wall street joining me is david bianco just in a nut shell i think you believe that we're in the middle or end stages of wringing out some of the effects of all that easy money and we know what happens. >> middle stage, not end >> we're in the middle stage >> this could be the tougher

part ahead >> you think disinflation is already here >> disinflation is happening because the economy has already slowed down a lot and we're probably on the verge of at least a small recession. so if inflation is still above the fed's target, if it's 2 1/2, 3% during a weak economy, you very much have an inflation problem. >> what do you think, still 5% s >> i think it's 5ish, maybe 4? headed to where? >> headed to just stllightly beo three. >> when? >> i thisnk in 2023-24. i think before the end of the year we'll see a small recession. i think it will lag a little longer than usual and the damage will be a little less than usual for the labor market but we're

already seeing, especially with the credit crunch that was happening about. >> the fed shouldn't raise any more then. >> see, that's the thing >> they still might? >> then they're wrong. i think we're at the stage where the fed probably know's there's a smaller session that's necessary. >> what does that mean for stocks >> it's not good we'd recommend health care, the communication sector we thought banks would be a good place to are this year but now -- >> why is it a deliberate move for the fed -- why do they still need to slow things down if they're going to below 3% anyway why would you hurt demand -- >> because the target of inflation is 2, 2.5% >> we're not making a very good case for what the fed basises is

necessary to hit that target and to hit that target being this high for two years now -- >> if on its own its on it's way down, even if the fed doesn't move >> it's still well above its target i blow the next leg is really just recession driven. that's a cyclical decline in inflation. it's not clear what inflation about be over the feel several years. earnings estimates for 2023 are down significantly but for 2024 they're you think those have to come down. >> that's the usual case earnings estimates about -- banks will take down their guidance for the year and they

will take down their earnings estimates, there is a credit crunch that will affect things like investment spending, even greater inventory liquidation. that's it leaves the question activity has been poor, suggesting inflagstick problem if. coming up, we'll speak with the house budget committee's ranking member stay tuned you're watching "squawk box" on cnbc

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welcome back to "squawk box. kevin mccarthy saying wall street should be concerned about the debt i want to bring in congressman brandon boyle of pennsylvania. i think there's a view on wall street right now that we've seen this movie, we know how it sort

of ends. it's always this sort of climactic situation that happens and then invariably a deal comes together at least that's the thinking but there's some view now maybe this time is different what do you think? >> yeah, good to be back with you. i've been saying ever since last november, december that my fear was this time could be different. i hope it isn't. but there's almost a danger, right, in the fact that there is often before been this sort of drama and it ultimately gets resolved it lulls people into thinking that surely automatically it will get resolved this time. it isn't automatic the reality is i see this situation a lot more of august 2011 when tea party representatives had just won control of the house of representatives and for the first time in history made the debt ceiling a part of the political fight.

i think speaker mccarthy is in a very difficult position politically. he made so many different problems to different groups in order to finally be elected speaker, he's having a tough time satisfying demands to pass a budget or to put a budget on the floor clean to raise the debt ceiling >> how does it end >> this's only one way it can end and that is a vote on the floor of the house of representatives to raise the debt ceiling period. interest's no other way. some people want to talk about minting a trillion dollar coin or invoking -- >> i don't thinkman, those things may not happen but i do think there's a question about whether there can be a conversation or a deal made that does have to do with reducing costs, trying to do something about the deficit. do you have think that is something that can even be on the table? >> let's be clear, though.

i'm glad kevin mccarthy has finally come around and acknowledged that the debt ceiling and the budget debate are two separate things. even he said they were like apples and oranges the debt ceiling is about paying debt we already racked up period it has to happen now, talking about next year's budget and over the next ten years, that's a debate that i welcome. it has to happen anyway because we have to pass a budget by midnight september 30th, so that is going to happen >> but you think that they're not going to be connected at all and they shouldn't be. and why shouldn't they be? there's all sorts of things in congress unfortunately that aren't connected, they get connected. >> except for -- except for the times when they don't. >> congressman, when you're paying your credit card bill and you're like oh my god, whatever family member that may be responsible. i'm not pointing any fingers at anyone

but is it really so horrible to say to someone, you know, let's talk about what we do in this next cycle, thisneck. >> we will be talking about and have to agree on a bipartisan basis by virtue of a democratic senate and republican house, we have to agree and reach a compromise >> don't even broach the subject now in. >> that's not at all what i said i'm talking about there is no question even for that family, when the credit card bill comes, there should never be a conferring about whether or not we pay it. you have to pay your bill, then talk about what you want to do in terms of future behavior. but i refuse to be lectured to by a group of people who every time they're in power actually increase the debt by more than when democrats are in power. >> congressman, we got to leave the conversation there we do want to thank you and i'm sure we'll be talking to as this

plays out. appreciate it. >> all right, thank you. >> thank you >> still to come this morning, initial jobless claims we'll get those numbers. and another reminder for you make sure you tune in for special coverage tomorrow of the jobs report. that's the month lively job rep. we'll be here starting at 8 a.m. eastern time remember, it's at 8:30 "squawk box" will be right back.

welcome back to "squawk box," everybody. here's some of the top business stories of the day members of the house select committee of the communist party are set to meet with executives from google, microsoft and more. on the agenda are threats from china and mining rare earth metals they will meet with apple ceo tim cook tomorrow. and blackrock to sell more than $100 million in securities they held in receivership. the securities are mainly agency mortgage-backed securities, collateralized organizations we are just seconds away from some enough jobless claims

data right now we've been watching the futures and earlier the dow had been up a little bit, now down by about 1.5 points s&p futures down by about 3. it may be worth pointing out for the week you were talking about the dow up slightly but the s&p and the nasdaq both down if you're looking at the treasury market right now, the 10 year is yielding down at 2.6%, the three-year is -- >> i'm watching ten-year note yields hit lower before the data hits the wires we're seeing jobless claims around that 200,000 number and if it's under, we break that streak it is above 200,000. 228,000. it certainly seems whoever was buying treasuries pushing rates down, they had a pretty good yes

there. that is the first time we've been over 200,000 since the first week in march. that was 212,000 last time we had a number around 228,000, you have to go all the way back to 231,000, the first week in december of last year. and on continuing claims, not only did we pop above 1.7 million, we popped above 1.8 million! watch these yields continue to move lower equities, a lot of reasons it may or may not follow suit, 1,823,000. the last time we were that high, buckle up, december 10th, the week of december 10th of 2021. at that point it was over 1.9. so this is really a biggie and with regard to equities, it becomes a little bit tough because obviously when claims are going up, that most likely is going to be a less tight labor market

we see much of the data is implying a weaker economy and many guests point to either flight to safety in treasury or a slowing economy. the problem or issue is that both of those dynamics cause buy and pushing yields down. that really isn't the problem but it can be a problem, especially if the equity markets view that as more of a symbol of a stagflation-type banner and that certainly seems to be the director many investor strategy seems to be aiming becky, back to you >> watch that now, 3.27 sitting right there for the 10-year. rick, thank you. steve liesman joins us for more on this report what are you thinking reading through what you're seeing >> i'm a little concerned. i was trying to call up the actual report on the bureau of statistics web site and i couldn't get it there. there was some rebenching that

happened they did a big upward prevision to -- revision of the prior week being over 200,000 where it had been, it does suggest some weakness goes along with the other data we've seen, the city's economic surprise index has ticked down the last several days and we've been showing you the data that has also come in below expectations, a lot of it having to do with the job market and whether or not that carries through to the reference week tomorrow, it's something to think about, the high frequency data i presented in the 7:00 hour one of the big things we're looking for now is the extent to which bank credit could be tightening there's not a lot of data on this but there is this report from the dallas fed that's updated every quarter and it shows pretty, you know, strong weakness across the board in lending. and this is a survey of 71 banks

in texas put out by the dallas fed, updated twice a quarter and this is during or follows the period of sill iicon valley. we're just showing you a few of the categories there, almost all of them in negative territory, many of them worse than the prior month or before silicon valley bank came out we'll be watching for national data interestingly you can expect the texas banks doing better than most because of the growth in in a state. hard to extrapolate but it could be worse than something we're watching, becky. >> thank you >> and before we go to break, we have some special guests at the nasdaq market site a married couple are here today for the opening bell this morning. and celebrating the mets home

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>> we've now gotten three key pieces of jobs data this week, openings, adp payroll and jobless claims a few minutes tomorrow is the official labor department report and we'll be here talking you through it, holding your hand, talking you down from the ledge, if necessary. flo hopefully it won't be necessary, starting at 8 a.m. eastern time. let's bring in julia coronado, and michael strain, aei economic policy studies director. julie, you heard the three things i just checked off. is it the start of what the fed has been trying to orchestrate in the labor picture in your

view >> i mean, definitely we're starting to see many indications of weakening labor demand. it's not just lay off announcements. it's a lot of companies across the board reporting reduced hiring plans, it's the indicators you mentioned yes, we are seeing reduced labor demand, better labor supply. we've seen wage growth moderating pretty steadily over the last few months. so it is exactly the picture the fed has been trying to orchestrate. it remains to be seen whether this will be enough because of course inflation hasn't yet shown the same progress or softening that the labor market data have seen we'll see how they square this circle but it's definitely clear across the range of labor market indicators that better balance between demand and supply is close at hand. >> do you agree with julia's

analysis there, michael, and can you explain why yields are where they are take your pick, 10 year, 2 year. where do you want to start >> yeah, so i basically agree with julia julia emphasized the kind of trends in labor demand and labor supply i think my emphasis is more on the levels and the gap between them is very large and surely was very large last month as well. we may see some softening in the number of jobs that were added to the economy last month. maybe we'll see a slight uptick in the unemployment rate but the kind of fundamental picture i think still will be of an economy where the demand for workers is well in excess of the supply of workers, where we have seen over the last year, 18 months, a kind of gradual softening in the labor market.

remember last summer we were adding over 400,000 jobs a month on kind of a three-month average basis every month. this summer maybe it's, you know, above a quarter million or something like that. but that kind of softening has been in place for a while if you zoom out and look at the longer trend. but where we still have a labor market that's much too tight and that is producing wages that are growing at rates that are much faster than are consistent with underlying productivity and with the fed's inflation target the one area i would differ with julia, i think if you look at wage growth, among the industries where inflation really is a problem will, right, core services, excluding housing services there you haven't seen a softening. wage growth among workers in those industries have been -- has been quite steady for many, many months and way too high

relative to the fed's target and so my kind of baseline view, even if we see softening, even if the number comes in at 275 tomorrow, 275 net new non-farm payroll jobs added, i think my base line takeaway is still going to be that interest rates have to go up higher than markets expect and that in order to get inflation down, we're going to have to get wage growth down in order to get wage growth down, we'll have to see a pretty big increase in the unemployment rate >> now back to you, julia. you agree with that? >> no. there's a lot of areas where i'll take issue with michael's characterization wage growth has been moderating the fastest where it was the hottest, which is leisure and hospitality workers and a lot of sector workers are seeing moderating wage growth on a three-month annualized basis, it's getting into the territory that's a lot more

consistent with the fed's 2% target let's face it, it hasn't been a curve inflation surge. it wasn't mainly wages that drove inflation up it's going to be a combination of factors that's going to bring wages down and inflation down. and so i don't think it's -- to draw this straight line from we need to basically cause a recession to bring inflation down i'd like to see more patience on the part of the fed. i don't expect that. they haven't shown a lot of patience but i think there is an evolution here that is happening. we have to focus on leading versus lagging indicators. i see the labor market as a concurrent indicator we just got a pretty big shock to the system from banking failures we know that that's going to ripple through the system and another wave of tightening credit was already tightening. if you look at not just bank credit availability but also venture capital funding and

private equity financing, all of that has tightened up pretty significantly. and we know from, you know, the research that that shows through into investment and hiring with a two-to-four quarter lag. so i think there are grounds for caution. again, i don't necessarily expect it. they probably will go again at the may have meeting barring some kind of market disturbance but the yield curve is telling us something the yield curve is deeply inverted even with the rally, it's still deeply inverted and that -- so if the fed raises the short end, what is that going to do, just invert the yield curve more, which tightens credit conditions that much more we don't know if that's necessary to bring inflation down but, you know, that's a judgment call that the fed has to make. >> just to your point, rick santelli is reporting that they

got the initial hits and continuing claims over 8 hup,000 and the third week over 1.8 million, which eventually the stuff starts to show up and you have to be a little cautious with the data as you're getting it >> that's right. there was a major revision to the seasonal adjustment, not just an annual benchmarking but a revision to the process. so we have to look at the whole trajectory let's keep in mind a recessionary level of initial claims is more like 300 to 350,000. so we're still in very low territory to michael's earlier point. the labor market still looks pretty healthy overall but the direction of travel is, again, if you're thinking about policy lag, you're wanting to look at the evolution of the leading indicators and the direction of travel and the velocity of travel and we are seeing, you know, a broadening in layoff announcements, we are seeing companies and earnings reports we do a scraping of earnings reports and we seen pretty

consistent reporting of reduced hiring plans companies are saying forget jolts, that's always been a problematic measure. companies have been saying it's a lot easier to source workers, turnover is coming down. they're still granting elevated wage increases but a lot lower than last year so, again, direction of travel tells us we're in a cooling look at what consumer spending growth is tracking. it's okay but it's come down substantially. we're back in normal consumer spending growth territory. so again, over time that means the whole economy is settling down out of that big burst that we had coming out of the pandemic so, you know, i see lots of signs that the labor market is moderating and balancing, you know, and how hard do you want to keep pushing it is the question >> i was wondering about the equities market. no bump on them, michael maybe you can both be right.

it's slowing but the fed is not going to care, which is maybe part of the problem. thanks, julia. andrew >> coming up, we'll talk to jim cramer and get his first take on the trading day ahead. you get the best of "squawk box" on our daily podcast listen any time. we are come being right back you got this. let's go. gobble gobble. i've seen bigger legs on a turkey! rude. who are you? i'm an investor in a fund that helps advance innovative sports tech like this smart fitness mirror. i'm also mr. leg day...1989!

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let's get down to the new york stock exchange. jim cramer joins us. we've had a couple of data points that may indicate the labor market is cooling a little is it a false start or -- >> no, i think that we're seeing a pretty big slow double play in hiring position, because i think there's very -- a lot of money coming out of the stock market, going into treasuries. i get the sense that everybody's skittish, particularly on the high end anything that's expensive, hard goods, they're just not buying so, i don't know i mean, i think that you could have a case where someone like loretta mester could be as wrong as she's ever been, maybe like h.o.f. wrong >> do you -- i mean, you've followed costco for a long time. >> really close to it. very close to it >> so, is that really it currency fluctuations and lower gas prices >> no, no, they were surprised

discretionary, hard good they were -- they had the wrong mix. discretionary hard good is very, very weak. and to the point where i think that they, themselves, maybe are surprised, and they're pretty good merchants worst numbers in three years, but more importantly, the disparity between soft goods and hard goods was rather extraordinary. i think everyone has to ratchet back walmart didn't have the same mix that costco had, but i don't know things are a little weaker than we think >> yeah, but not necessarily a macro phenomenon >> you can have the wrong mix. it's travel. the money is going away. do you sell costco knock yourself out they're able to turn on a dime they can pivot but you're just not seeing a lot of expensive stuff moving. anywhere so, i mean, i just think you have to be a little careful. >> all right jim, thanks. we will see you in just a couple minutes, 9:00 a.m., "squawk on the street."

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mr. and mrs. met, along with general manager billy eppler is here ringing the opening bell. they are celebrating the mets' home opener. we have them as guests here, which was moved to tomorrow, because not exactly baseball weather in new york city today >> yes and no questions. >> yes-and-no questions. >> all you can do is shrug >> between the two of you, which one makes the financial decisions in the household who's the money manager? she is, mrs. met >> we should play that game where they do this do you know? who's funnier? who is the better hitter who is the better -- you got to help me here with a lifeline >> every question i'm thinking of, i can't ask. >> oh my >> we're really out. >> that's good >> my question is -- i'm looking

for a team i love the reds, but i live here now, and i'm going back and forth. i like this new -- mets? i like this new guy on the yankees who went to del barton he's 21 years old, derek jeter was his idol >> you're making them sad and mad. >> well, you need to sell -- mets, not yankees. >> because we're -- >> i like the national league better >> i'm going to go with a little bit of business meets -- >> they can't answer >> steve cohen, love him >> yeah. >> you guys get -- steve, you guys talk about the markets? you guys together, steve and you? yeah, okay, so you talk to him on the phone, you email and text does he think that the markets are going up or down you got to think about that one, you're not sure? maybe. he thinks big thoughts is what you're suggesting, i think

okay all of these, you know, he's done a lot of trades he's got a lot of new players on the team, spending a lot of money. do you think it's going to work out? big-time big-time >> are you fairly compensated? because you're good. you're really good you're both really good at this. >> a raise we should get you a raise, yes we're going to work on that. i know a guy >> is there a mascot union >> oh, that's interesting. well, the players are unionized. so, yeah, what do you think of unions, good, bad? complicated question you're into it okay >> we like everyone, i think, is what he's saying >> i think that's very political, that answer very good. thank you. >> thank you both. >> thank you both. >> amazing >> thank you both. >> amazing mets. >> the amazing mets. >> moved to tomorrow, by the way. >> mookie wilson, darryl strawberry who's your choice?

you love them all. okay >> this is why they deserve the big bucks. thank you both our next guest says that for the first time in many weeks, the monthly jobs report tomorrow will come in below expectations. joining us right now is greg branch, managing partner at veritas financial group. greg, follow that act. >> that will be hard to do but i don't even think that's a hot take anymore the adp data that we've seen, the ism data that we've seen, and the initial claims that we saw this morning all indicate that the fed's rate-hiking is taking hold. we will see something south of that 235,000 number after several months of almost doubling consensus, and so the program is working, although i disagree with what david bianco said this morning. i think the fed is probably done here i think that the duress in regional banking land is going to carry the water for them. the credit crunch, the illiquidity in the system, the

unwillingness to lend, i think all of that will carry beyond where they would have hoped us go with increasing that terminal rate >> you're saying what a lot of people in the market are thinking, especially if you look at where the ten-year stands right now, where the two-year stands, it's at 3.746% that's kind of the idea, that maybe is fed is getting to the end. but when we spoke with steve liesman earlier today, he said the fed is going to be looking for absolute proof in inflation numbers, not just signs that things could eventually turn the corner because they've gotten a head fake from thinking inflation was dropping earlier what happens then? >> i'll point out two things first of all, i think i'm saying what the bond market is thinking i don't think the equity market's thinking that at all right now. i think, in fact, the equity market is somewhat in euphoria, particularly the nasdaq, with the revelation that the fed is likely, if not done, close to done >> got 20 seconds, greg, and then we're out >> we will transition to the market seeing the effect of all

that fed rate hiking and the fact that estimates are still far too high because they haven't priced in the slowdown yet. >> greg branch, thank you. you were able to communicate very clearly because you got to use words there, and that was a good thing >> that was great. >> see you soon. one final reminder we'll be here tomorrow starting at 8:00 a.m. eastern time to cover that march jobs report make sure you join us. that does it for us today. right now, it's time for "squawk on the street. ♪ good thursday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer at post nine of the mark stock exchange. david faber has the morning off. premarket, a little wobbly after jobless claims come in at the highs for the year on these revisions. challenge or layoffs all higher than expected. ten-year yield still near that six-month low. our road map begins with markets bracing for tomorrow's key employment report as jobless claims jump well above 200,000 from jobs to the consumer,