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, costco falling after posting its

first monthly comps decline in almost three years disney's restructuring rolls on the streaming chief is out, and former marvel chair ike pearl mutter telling "the journal" he was fired, not laid off. let's begin with the jobs market the nasdaq coming off its third straight day of losses goldman said, don't be surprise first-d ed if you get a bounce on these jobless claims >> i do think we got to start thinking that the last week of march was weak i think april's weaker i think that the banking crisis resonated with a lot of -- mini-crisis resonated with a lot of employers i think we're going to see a lot of reduction in forces i think there's a lot of companies that were built for an aggressive, let's say, for pretty decent year, and i think that the table of employment's too high for a lot of different companies, except for companies that are in restaurant and travel, which should just continue great mastercard survey out today, restaurant and travel when we look at costco, what r

people not buying? they're not buying anything that's discretionary, any hard goods. it continued long after people thought it would be over people are still long on money and short on time, and they are still traveling, and it is just resonating with a lot of the companies that make things are kind of still out here i mean, autos are still okay, but there's a lot of -- although i think toyota, i'm hearing, having problems making a lot of cars and trucks. supply chain but i just think that we're kind of at this moment where a lot of employers are thinking, wow, you know, not just stock-based compensation for amazon, but maybe we just don't need to hire coming out of school >> right >> and i think coming out of school, this is a bad time to be coming out of school for the first time in a very long time. >> yeah, i've seen worse, but yeah >> yeah, like, i applied to 52 newspapers when i got out in 1977 all 52 rejected me, and i saved every one of them. and believe me, i'm still here, but 52 of those, gone.

>> those recruiters are gone to your point about growth, jpmorgan last night, they're still looking for a three handle on q1 gdp, but they think that goes to one in the current quarter and they say, look at the survey data we got this week the down shift is under way. >>i think that is very true. i'm a big follower of david cost, i think he's fabulous at goldman, and you know, read the tea leaves there, i think he's thinking, wait a second, we've got a lot of buybacks. we've done a lot of issuance, but we have a lot of people leaving the market because it's just -- you get such a great rate you get a great rate in treasuries it's almost unjust if you're a rational investor, you've pulled your money out, and you're getting foreign treasuries, and i just think that there's a lot of people who hate this market, and i think that there are companies that are gearing up to have if they're in -- i know that this artificial intelligence, people say, jim, stop it already. no no there is just -- this is a great

time if you're a company to reassess how many people you really need, given the fact that the artificial intelligence products is equal to or better than what your people produce. >> we talked about costco yesterday. there had been some revisions to forecasts on the comp number ubs today asks, is costco the canary they think it's a signal for what retail will tell us later >> i want to kind of banish the canary in the coal mine, because costco is the coal mine. everybody goes there it's not -- you're not going to suffocate. you're not going to not suffocate. there's absolutely terrific sales when it comes to soft goods, when it comes to food, things are great but this hardware, people are not buying expensive hardware. they'd rather travel so, i don't want -- the reason is because i look at the mastercard survey, people are still spending i mean, they're just not spending on what they were spending on, and i think that there's a bad mix shift going on

in the whole country where people thought by this point, no one would be going anywhere and people would be hunkered -- no they just are neglecting their home they're neglecting putting new stuff in their home, and we're going to see that, and they're going away still at record rates, so i want to just be careful. i just say, the misallocation, where you thought -- rationally, they're taking money out of the market they're going away they're not buying hard goods. and that's not the mix that america's based on that's not how we do things in this country so, that's -- in other words, i'm saying, no canary, but an actual mix shift to where money's spent. >> sure. >> the mastercard numbers, boy, i love that spending survey. >> yep, yep. >> those guys are fantastic. it's like they must have your credit card or something they really see it and i just think that i didn't expect it. did costco not have the right stuff? costco has everything. and the stuff that is not selling are big -- like the big

tvs. walmart did better, but they don't have -- walmart was actually really good, but when i mix that with what fedex is saying, i just think that there's -- we're having 5% on the growth, each end, ecom ecom's not doing that well i think we're going to discover that ecom is not doing that well >> it's not all on costco, of course we could layer in levi today, revenue ahead, but the stock is down six >> i got chip on tonight, and i think that -- i'm not saying that the stock is necessarily the right thing that should be down i'd like to speak to the ceo before i make a judgment there, because ralph lauren's numbers were really, really good that's important pvh numbers were really good so, there's some parts of apparel that are doing well for the first time in a long time, but furniture -- you're in the furniture business, well, you know, i think you're really trying to figure out what to do with that inventory. >> yeah. they had -- they had a moment. >> yes, they did >> and then you talked to

conagra last night about how all of this is going to result in pricing down the road. take a listen to this. >> a lot of people are talking about deflation. well, deflation isn't here yet we're in the back half of our fiscal year, in the back half of our year we're still averaging about 6% inflation, so that's inflationary we don't need to take additional pricing to cover that at this point. the pricing that we have in the market should be sufficient. now,let hope we don't get another spike in inflation, but right now, we don't see it inflation is moderated the pricing actions for now are done >> kind of echoing what pepsico said a couple months ago, we think we're done for the year. >> sean conley laid out a really good case. they've caught up. they're making good money. but again, here's another shift. the shift to snacking. i mean, i know these things don't sound like they're a big deal, but the snacking and watching netflix at home should have ended a lot of things should have ended. commercial real estate should

have come back people should have stopped saying, listen, i got to see the world. we're just not seeing the patterns we saw pre-covid. it's just a very changed consumer and i think that we all have to recognize that maybe these things are -- i'm not saying they're permanent, but right now, there's no sign that people are spending a lot on their home there is a sign that people have switched to snacking there's still people who are not coming to work the commercial real estate is not that great, and then we have the money coming out of the banks, and i think that that's -- every day, that's the story. when you read the different research notes i mean, the only -- there was an upgrade wells fargo. wells fargo is not allowed to do anything in february of 2018, wells fargo was given the moment that is now, which is that, you guys, you can take deposits. you can't do anything with it. everybody else, i think, is struggling, saying, we're paying almost nothing on our accounts the money's coming out

they're buying treasuries. people are selling stocks. there's no new issuance. it could be an explosive moment for tech not yet. tech can come down we saw a preview but i think tech is where you have to be >> really? that's interesting last night, btig, krinsky's point was, we think tech has benefitted already from the rotation out of other sectors, and if it's the last man standing, it's going to create vulnerabilities for the indexes. >> that would, in normal times, be very good analysis. there's a revolution going on in tech, which is that whatever you were -- it's like when they discovered the cloud when they discovered the pc. this artificial intelligence, it doesn't matter you're sitting down with people, and you're saying, listen, i can't cut my spending on cybersecurity. that's an issue. but everything else, i just want people fired because the machines are better than people. now, i know that sounds absolutely crazy, but it happens so quickly that -- nvidia just did it, okay google had this false comparison, compared it against

the previous quarter that was a shame that google did that, because it showed me that that's not the google i know >> you think they were being disingenuous by choosing an older thing to compare themselves to? >> yeah, and they put it out before the survey came out i want the old google back >> you say "the journal" today basically saying -- i forget the actual quote >> he's saying, they have to use it >> he was asked why they didn't roll it out earlier. he said they were working on it but the moment came sooner than we thought >> let me ask you, ten times richer than me, if not a hundred. jensen huang was talking about this at nvidia for 18 months he said it would happen. it would cross over. why didn't -- did he need sam altman did he really need chatgpt to recognize this was occurring he was screaming through the rooftops i remember when jensen had me make the cezanne seascape. i want a still life. he said, okay, here, it comes

out. he was doing this and people thought it was a parlor game people thought jensen was involved in a parlor game where it was just something really funny. it was a card trick. he was the blayne of artificial intelligence no this thing is happening so much more quickly it's happening quicker than the microprocessor i don't think people realize there isn't a ceo i talk to that doesn't say, listen, we got to rethink how many people we need. people aren't as good. >> well, some would argue, classic innovator's dilemma, right? great search business. why upset the apple cart >> how much does humana medical advantage get when you have a staff that doesn't need health care we're in an historic time, and these analysts are looking at flow funds they don't get it. we have companies with great breathe balance sheets, but they're all sitting -- google didn't want this >> not now >> google existed upon the idea

that you typed something in and you got 17 different ads and everybody paid for it and they junked the site up, just like amazon, and there's a big rebellion against these companies. they know it internally. they're just trying to figure out, holy cow, people don't like to buy the wrong pair of shoes because of the ads my travel trust owns them, and i rethink that every single day, because they are at the heart of what jensen is crushing. you don't want to type in -- that's very -- typing in is gone >> it's gone >> look, when i got in -- scm was a dynamite stock when i got in the business. that was a typewriter company. >> you're not comparing alphabet to smith corona. >> no, because they have the resources. it's just their business model was easier without that, because they required you to type, and typing will be going away. >> yeah. >> they -- jensen's machines

understand 28 languages better than you can type and faster, and they can anticipate and then pretty soon, you won't -- they'll know what you're thinking >> yeah. >> ahead of when you're -- >> exactly amazing disruption >> people don't understand what he did here. >> well, figuring it out, though, quickly. when we come back this morning, tons of media news. ex-marvel chief ike perlmutter talking to "the journal" about disney take a look at futures losing ground here close to ssieson lows. "squawk on the street" continues after a short break.

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ike perlmutter in the crosshairs with disney after his departure from the company last week the ex-marvel chief says, "i have no doubt that my termination was based on fundamental differences in business between my thinking and disney leadership, because i care about return on investment." perlmutter recently lobbied for nelson peltz to join disney's board, and in a press release overnight, he said he'll continue to hold disney's shares and advocate for improved cost structure. the picture of his departure, jim, really filling in here between, as he says, the creative community at disney is powerful >> right, well, i mean, ike's view is largely based on the fact that it was possible to take these characters from marvel and make low-budget

movies that made a fortune instead, it got hijacked by the creative people who make high-budget movies and make far less, so you meld that with the fact that ike is forever saying the overpay for fox and then it's very difficult to figure out where exactly it is, and you have a company that's spending way too much money still now, nelson peltz wanted to attack that spending too, particularly in hollywood. the spending in hollywood is way too high now, i'm going to emphasize that bob iger was trying to identify with those, but ike is -- ike's irascible. i like him i think what he's about, there should be an ike perlmutter in every boardroom in america who says, "i want to question that." does he do it in a way that makes you feel like, well, it's warm and fuzzy since when is a boardroom supposed to be warm and fuzzy? we have a lot of boardrooms that i have sat in actual meetings of boards, and they're very much like a faculty meeting at

harvard. like, well, i think we should maybe history and literature should be more of an emphasis. >> interesting meanwhile, the streaming chief at disney, michael paul, is going to leave the hulu guy's going to take over >> what do we think about that >> needham, laura martin writes, "bob iger, on the florida stuff, quickly won the battle where they have 75,000 theme park full-time employees promising to invest the $17 billion in the state, and making desantis look anti-business," which needham argues is a negative for republicans. >> it was a negative for his presidential opportunity i think that -- i don't think iger's -- i think he recognizes that maybe this changes streaming. he's got to cut costs, and he's got to change the way hollywood makes things no one wants -- if i were bob iger, i would say, what does jim cramer know about hollywood? i know about stocks. i have seen this stock be crushed, and there's no dividend

it was a great dividend, you made a lot of money. i bet you ike made about $80 million a year from his dividends, but where did that widow? n we're not in a communist country where we say, that's ike's fault. no, we're big capitalists here, and i think that ike's point about not getting a dividend because they spent too much money on hollywood and fox is so textbook that only people who are maybe even more thin-skinned than i am would say that that was wrong. >> the pushback's going to be, there's a reason why creatives want to work at disney, and that's because they give them priority they're treated well they're given freedom, right isn't that how we get great franchises >> all right i think that you can make movies without them, because we know how to program what they would say. i don't think people realize what's happening in this country. >> you're really -- that's really -- everything is coming back today >> i don't think people realize

what's happening in this country. i don't think people realize i just don't think they understand we don't need expensive people we don't need people who can't -- who write things. >> of any sort, journalism, advertising, screenplays >> no. >> human -- >> well, screenplays, because jensen's a humanist, but there's a globe theater that he showed me, we can see actual shakespearean characters and put us in the third row. people are going to see it they don't see what's happening. >> that's interesting. we'll get cramer's "mad dash," countdown to the opening bell, final trading session of the week obviously, holiday-shortened week we'll talk about how the market's going to play that jobs number in advance when we return

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time for cramer's "mad dash" as we count down to the opening bell >> very interesting and surprising piece of research this morning out of bank of america, talking about how coinbase has not picked up any business during this period, and they questioned, they thought that maybe that would be, at this moment, with all the different turmoil, that coinbase guantana would be the beneficiary they are saying coinbase may be too high and "we remain cautious on coin and view the consensus estimates are too high." they're maintaining underperformance 6789 he said they're just talking their negative book, but i thought the coinbase would have huge inflows here i just figured they were, to some people, the jpmorgan of the business, so the money goes to

jpmorgan well, doesn't look like it >> the other puzzle is why, i guess, some argue bitcoin has held up relatively speaking given what would be obvious drains in liquidity. >> i know. well, there was another time where i would have said it's just manipulated hire. these days, i just find the behavior very quizzical. i would not touch this thing at all. not at all >> this thing, meaning -- >> i don't think you need crypto right here look add gold. gold is starting to get its ascendance versus crypto, and they take gold everywhere takes gold. not everywhere takes crypto. >> we did see forecasts yesterday for 2,200. >> i think gold is interesting here >> we'll watch that along with eng doar opinbell coming up in five and a half minutes woo-hoo! [ ominous music playing ] woo-hoo! our customers don't do what they do

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>> announcer: the opening bell is brought to you by nuveen, a leader in income, alternatives, and responsible investing. you came here and said, listen, jim, i think there will be a recession everyone else was still thinking things were just on this kind of uptick where are you now in terms of your view? you were so early and so right >> well, i think, you know, if you remember the conversation,

there were three things that we talked about one was that the industrial economy around the world was slowing down second thing we said was the u.s. consumer was spending more on services versus products, and third, that there was an e-commerce reset from the highs of the pandemic. all those three things came true in fact, because of that, our volumes went down significantly. but because of the work that we just did, you know, third quarter results we announced in march, we were able to improve our operating margins in fedex ground and fedex freight despite significant declines in our volume, so that's the things that we focus and the things that we control, and looking ahead, i think the e-commerce reset is about done. we think we're flattening out right now. >> that's jim with fedex last night. that's news. >> yes look, i was shocked. they're talking about e-commerce at a level that really is nothing exciting at all.

i mean, e-commerce at a kind of a little bit better than gdp that's amazing obviously, he's taking out $4 billion in costs, which, by the way, is real, because they combined three different divisions into one i think he's doing a remarkable job. everybody today raised price target >> ray jay goes to outperform. >> it's certainly not on volume of good. volume of goods is really down versus what we thought it would be it's a service economy, but it's a travel economy look, i thought what he said was, we're going to make a lot more money even on this little amount of volume, and it's very impressive buy fedex, get rid of everything else >> that's interesting. sort of related is walmart, the reaction to that meeting yesterday. stifel goes to $161. key goes to $170 >> that was another good meeting. here's the story about what i see happening. if you can cut costs, and you can use your facilities for more

than they're currently generating, buy that stock walmart, fedex >> they really are becoming -- and meta, poster children for operating efficiency yeah >> i think the efficiency -- i think that zuckerberg is the figure for this moment he was earliest in efficiency. it's even expected from him, because he's not known as someone who is really so far ahead of the game ever since, you know, tiktok, reels, instagram. of course, instagram's now at 300 basis points by the way, instagram, huge winner in the a.i. world >> there's the opening bell and the cnbc realtime exchange at the big board today, the miami marlins, and we will be joined by the gm and president of business operations at the nasdaq, it is the new york mets celebrating the home opener today against the marlins. you saw sorkin with mr. met. >> sports is an area that's not going to be impacted that much

by the revolution. as i see it. >> live sports either in-person or -- >> it's still going to be really terrific, and i think that bodes well for the networks. they've got a product. i think the networks are -- look, i work at comcast, but the things that are working at comcast, theme parks, and i think networks can do better look, i just think some of the valuations for companies that do service are just -- they're insanely low, and the companies that have a big installment, big plant, big system, this is where amazon -- if it could just figure it out, will crush it because now we know that e-commerce isn't growing, so you don't have to keep adding people that was the big problem they were thinking e-commerce grows at like 15 a year. so, they're hiring, hiring now they don't need to do that, but andrew jassy has to put his big-boy pants on and reach some conclusion that are the opposite of what he's thinking right now. >> well, this move to reduce

stock-based comp is a move in that direction >> nice start. he's got a lot of work to do you can't fix the offense and the defense at the same time but he now has got, from fedex, the real numbers of what commerce is growing. he can lower his table of employment without as much worry about next-day sales doing poorly he's got an opportunity here to really make a major change and he's got to -- look, i like him very much. i have to -- i think those guys are fantastic. but they have a major opportunity right now to realize, it's not growing anymore, so we've got to cut and he can do it i beg to say that to amazon, not efficient. >> well, i know you brought up target in the past in that context, and that, target, tapestry, some of the other retailers, costco, certainly, itit etsy are going to be among the losers today >> etsy is number nine on the team list that piper comes out with, and etsy's scoring at the

top with younger people. look, i think that people don't want to buy things that are 27 times earnings when there's a lot of stuff that sells at a much lower multiple. meta is the -- well, you know what meta really is the kind of -- the metaphor for the moment. you got a company that sells it probably 18 times earnings, that has fired a huge number of people, where the revenues are going up, and there's a possibility that its number one opponent is banned wow. what a set-up. and by the way, he does not crow one bit. >> not really, yeah. they've been disciplined in their message. >> they're very good they don't like to talk. >> by the way, "the times" with this great piece about how china officials took to social media to push back against the tiktok hearing as macron, by the way, is in china, and trying to move the needle on getting peace talks restarted, certainly airbus is now going to double a-320 capacity in china. >> i think china is trying to figure out where and when to pivot to i think the people are

misinterpret -- speaker mccarthy, he meets with the head of taiwan. you're not even supposed to admit that taiwan exists even trump struggled with admitting that taiwan exists not only does taiwan exist, but battle ships and aircraft carriers exist i think the chinese overplayed their hand on covid, and they're overplaying their military hand on taiwan, because now we're recognizing taiwan it's very hard to recognize a country and then have the chooinz take it over that's not going to happen i think china is trying to figure out their place in the world. we all felt that china's place in the world was world dominance, because we have a terrible view of our self-image, and this is what i believe but i think that china's more on the run than people realize. >> don't you think they've been humbled by what has happened in ukraine? >> exactly >> their aspirations, at least >> and i think that russia has overplayed its hand. new flow of funds that we're seeing for oil are very bad for russia very bad and where was the fabled winter

offensive? the winter offensive did not occur. i hesitate to say that this is a moment where the russians, if we send them -- if we send the ukrainians the aeroenvironment drones, they can blow up whole mechanized divisions just take them out >> we'll see how this counteroffensive does. "the ft" -- >> i think the counteroffensive is going to be remarkable. >> maybe crimea can result in some talks >> that would be something that is really russia. >> jim, the banks not -- you mentioned some of the upgrades of wells, fifth third got an upgrade. >> how about comerica? jpmorgan downgraded comerica it was upgraded away jpmorgan has pretty good bank analysts >> pnc gets cut, by the way. >> wow pnc said -- they cut it because it was outperforming oh, my, if that's

outperformance, give me under armour >> meanwhile, this afternoon, we're going to get a fed balance sheet and another look at the discount window. we did at least get that update out of western alliance where it looked like some of the flows had stabilized >> i don't think it helped the stock. i think people feel that -- look, it wouldn't be surprising if, at the end of the day, there will be a lot of people who are worried that some bank goes under this weekend and because the fed -- the federal reserve from san francisco, which i think is just a -- shameful people who owe the nation an apology. i think that they are dealing right now with how to get their arms around the fact that it's their banks that they follow are just horrendous. >> yeah. >> and i think they've got to be very, very careful out there just very careful. >> right meanwhile, apollo has a nice chart this morning, looking at the dallas survey on lending, and they argue that the credit crunch has already started, if you look at the data from the

week beginning march '21 >> absolutely. >> we're no longer waiting for the data to start reflecting -- >> no. look, just to get away from a.i. for a second, i think there's going to be reduction in forces because i think people realize, wow, business isn't coming back. the mini-crisis is with us we have gotten no clarity whatsoever that the discount rate strategy is working for the banks that have people with deposits i'm seeing all these stories that are really incredible, still banks where the average depositor has $350,000 and that person is a fool >> you're saying they should diversify their deposit banks. >> absolutely. why wouldn't you do that why not buy treasuries why would you keep it and earn nothing? >> maybe because it's getting incrementally less attractive. >> if you're a rational investor, buy treasuries, pull your money out of the bank and don't put all that money -- eggs in one basket. if you're advised by pay chex, smart guys, they're saying, listen, you can't do that anymore if you're a charity with

a million dollars. you got to spread that around among banks. the banks are seeing money go flying all over the place. that's not an atmosphere you want to lend you have the auto loans doubled since last year. yes, mortgages are the same price, but the sellers aren't breaking price we see commercial real estate. i like commercial real estate, but we see the thing that people aren't coming back and the vacancies in the big markets are going up, and the fed is talking about -- and ms. mester is talking about the need to tighten. >> well, she -- >> she's going to be as wrong as mary daily, and these are people who are very wrong, and jay will end up being very wrong with them if he doesn't disparage them now, you can disparage, by the way, by not calling them names just say, i understand what the people in cleveland are saying i understand what the people in san francisco are saying, but that's not how i view things that's how you do it if -- i've really gotten good ill-advised, suboptimal. it used -- i used to spend --

>> great american. >> i used to spend half -- nice person half my time defending what i said on air, because i spoke truth. now, i don't speak false i just know how to do it better than i used to i would get back and know, yeah, i shouldn't have said -- i didn't mean that now, you know, being gandhi is so cool. you can do whatever the hell you want when you're gandhi. >> i'm glad you brought up auto loans. tesla a two-week low on reports that -- well, certainly, the employment in austin is on fire on reports they've basically 3 x on the austin workforce. >> you heard this from me. tesla's become a commodity >> don't all oems eventually get a legacy multiple? is that where they're headed >> i just think that the allure of tesla when you've got steve schurr from hertz buying 100,000

teslas -- i want a ford lightning, and it's untrue they're for sale online. that's an arbitrage in some parts of the country they're worth more than a used one. you can get more than you paid for it >> like taylor swift tickets, right? secondary market >> exactly we got them. my wife got the taylor swift tickets. >> congratulations >> levi strauss down two bucks i'll glad i have chip bergh on tonight. ralph lauren had good numbers. contour brands had good numbers. what is that what is that >> that's -- >> and by the way, macy's wasn't bad on soft goods, and costco wasn't bad on soft goods we've got to find out what's wrong there. remember, costco wasn't bad on soft goods, and it could be business as usual for costco after they pivot they're remarkable pivoters. >> levi bouncing off levels back to march 15th or so. >> that was -- if pvh beat the numbers, and you know, look, that's calvin klein, and it's

tommy hilfiger, then levi strauss has some explaining to do here's 100% of the increase in control in beer, and bill is going to tell a good story by midday, someone's going to read -- this stock gets very heavily rated down, but the number that matters is called depletion. and deplease, we're looking for 4%, just call it same-store sales, and it came in at 6%. that's the number. that stock should be higher. but it has enemies, and i don't understand >> how about abvi sort of trading against this guide-down? >> they have the right yield they haven't even addressed how much low-hanging fruit they can use the botox. we had a nice trade in abvi. i didn't want it to be a trade should have been investment, but we just wanted to have as much eli lilly as possible, because eli lilly, they've got both alzheimer's and weight loss

reduction, and they lowered the price of insulin their opponent in insulin is novo nor disk. if you lower the price of insulin, nor disk does not have the money to expand wygovi >> the breakout in merck, jim, best-performing down name, going to take you to the highs of the year >> people keep thinking that rob davis is -- that all this is just keytruda, the anti-cancer his breadth away from anti-cancer is extraordinary the stock at 16 times earnings is a steal now, it's not st. merck where everything they touches turns to gold, but i think bob davis -- rob davis is very underestimated ceo, and the franchises wthere are so much better than people realize, but he's a nonpromotional person, and he's just going to put out great numbers. anti-cancer keytruda there's much more to it than

that >> you mentioned a.i ibm is working with cleveland clinic we're waiting for those use cases. >> yes, and i want to see -- so, jensen says it's health care is second after the advertising world, which is the low-hanging fruit, but that health care will be the predictive nature of it is going to be extraordinary >> that would be amazing >> i'm sorry i spent so much time talking about -- when i talk to them, carl, i speak to them, and first of all, they're not like us. i mean, they -- they're just -- right now -- when i met andy grove, one of the top guys at intel, he had used something i had written in his annual, and i said -- i went up to him at a party, and i said, thank you so much for using something i wrote. and he said, so? >> yeah, that's right. >> so? >> that's how it is with geniuses >> a board member pulled me

aside, he's not like that. he really doesn't care what you think. >> okay. jensen is andy grove with a human face >> while i have you here, let's talk just briefly about the jobs number tomorrow and whether or not -- >> it will be the first one. >> you think it cracks here? >> it's the first one where people realize, you know what? wow. >> for real? >> yeah. i think that j.o.l.t.s. number -- i think the help wanted signs are down, and not because they found the people. i think that they're afraid to hire i think this -- i think we underestimated what happened with that week, that silicon valley week, that credit suisse, that hit the psyche of americans. treasuries -- a rational investor is moving their money from a bank account into a treasury there's money coming out of the stock market when david kostkos kostinen, who i think is brilliant, his work is going to show, the money coming out of the market is big. at the same time, we have certain companies that are doing

amazing things, and going to take a lot of share because of their recognition of artificial intelligence, and like salesforce, i think that marc benioff -- wouldn't surprise me if he isn't sitting down with sam altman a unassailable >> kostin has recently said that the classic s&p gain you get after yields fall isn't going to happen this time they're still looking for 4k year-end >> i think the money is still coming out i think it's going to be back to that bifurcated qqq trade. i think that will work i think the drugs work, because they just are doing things that people didn't expect >> right >> but i think that the money's going to come back after we have this shakeout right here where we have a shakeout where the nasdaq's coming down, we're going to have new leaders and the leaders are going to be nvidia, and they're going to be meta, they're going to be salesforce, and they're going to be companies that adopt to an a.i. world that are efficient that are firing people

and make a lot more money with fewer people, which, by the way, fedex is also in that cohort >> right >> if you're not firing, get out of my face >> and on your life-is-short thesis, do you stick with travel and leisure in an environment where unemployment is going up >> travel and leisure among millennials, gen x, they seem to have no -- you got to own american express here. i know people are worried about the small business side of the equation and whether they have bad loans. no that's just -- it's just the right stock. booking is the right stock pkng by the way, they use real numbers, they use gap numbers. they don't use stock-wabased compensation i'm betting that the year of efficiency is upon us, and that everyone's using a.i. to figure out how to get rid of people and saying, you know what? zuckerberg had it figured out. >> airbnb almost a six-week low. >> chesky is going to figure it out. i think that chesky is a better -- he's got to come on

and explain that there's no degradation among the wealthy, that the wealthy are still traveling, because i think they are. and bkng would say that. but we're at a moment where this long -- i'm temperatulling you, long money, short time is colliding with companies that don't see it coming, and the companies that don't see it coming are going to be run over, and the companies like zuckerberg, like meta, who said, you know what? maybe we only need -- the next thing you're going to hear meta is that these big real estate things that they did, they're going to buy them -- they're going to buy themselves out of those leases >> mostly in new york city >> they have way too much land i'm not talking to mark right now, and he's on a little sabbatical there, but he's going to have to do what i'm saying. >> finally, while we're in mega cap tech, apple opening their first store. >> apple gets it they didn't overhire >> that's what adobe would also argue. >> oh, they got it

both apple and adobe, i'm not saying they saw it coming. i'm saying they never went and said, you know what? this is the greatest time on earth. let's just hire anybody who moves in let's have a six-week interview process and hire them and tell them it's a job for life no no apple ran its company as if it was scared >> yeah. >> they run scared at apple. they do. even eddie runs scared they never thought that there would be -- they don't act as if they're kings. they're not peachy you remember peachy from kipling? i'm trying to bring rudyard kipling back they are not the men who would be king. sean connery >> they don't run head long into new categories >> they're moving into india that's terrific. let's not rule out that because of infrastructure, you're going to have a lot of companies that do well because the federal government is giving away money.

i'm putting together a list of things that work, but they start with zuckerberg. >> fascinating we'll see what the jobs number brings tomorrow. >> zuckerberg and jensen are the two people of this era >> remarkable given what mark has been through >> those are the people you have to take -- >> also, we're holding 4070. keep your eye on bonds as well bullard is coming up in about 12 minutes. for now, ten-year, still south of 3.30%, a level it's defended a few times this year. at adp, we understand business today looks nothing like it did yesterday. while it's more unpredictable, its possibilities are endless. from paying your people from anywhere to supporting your talent everywhere,

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let's get to jim >> terrible numbers. lost a big order, but the reason is the agency may have an ordering freeze. once again, big companies just not buying that much more

equipment. consumers not buying that much more big for their home. let's be careful, service economy, service economy i keep saying, service economy that's where we are. >> that would have huge implications for business spending and large cap ex. >> yes everyone is caught going the wrong way. i can't believe that guy's right. it used to be the year of living dangerously. now it's the year of magical thinking. >> tonight >> if you remember the club you'll understand why we think this is a great stock, constellation brands aeld then chip bergh, let's find out what's happening with levi's ralph lauren had a great quarter. >> the best stock that i follow is french fries. >> up again? >> peak quarter. french fries

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good thursday morning. welcome to "squawk on the street." live at post 9 on the new york stock exchange it has been a week of slowly eroding macro data today is no different with jobless claims coming in hotter than expected. stocks are down. 10-year still near a six-month low and the jobs number tomorrow. >> 30 minutes into the trading session. costco shares under pressure after reporting the first monthly same-store sales drop. the stock is down by 4%. coin base in the red trimming the price target to 38 bucks a share. firm forecasting retail crypto volumes. a key source of revenue.

shares at 1 1/4 percent. pnc, kbw downgraded to under perform. it is up though by .6. fifth third getting downgraded as part of this call as well mike. >> all right we have breaking news on the fed crossing the tape right now. let's get to steve liesman with those details. steve? >> reporter: hey, mike some new comments and some old comments from bullard that are news because he's continuing to say them he does say financial stress readings are relatively low. that's a change be in what he said a couple weeks ago when he said financial stress had returned he does say financial conditions have become tighter and then he's repeating himself he says the fed can continue to hike while using other policies to handle financial stress this is this dual track the fed's been talking about we have banking problems over here we angle them with what we call our supervisory or macro credential we have inflation and we handle that with interest rates and the balance sheet.

he said financial conditions and interest rates remain below levels of the financial crisis he joins a number of fed officials who have said inflation remains the bigger concern. they've not sounded like concerns over the banking system would keep them from hiking rates at least one more time take a look now at new data from the dallas fed it shows banks are cutting back. a survey of 71 texas banks coming after the failure of silicon valley banks it shows net percentage of banks reducing overall lending in commercial real estate and in residential real estate. forget what the fed is saying. that's what the market seems to be talking pretty much unpersuaded. the january fed funds. guys, i take that back a little bit longer down again today this is the outlook for the january fed funds rate remember, the fed is at 5.13%. there you go, it was up a little higher before and then it's come back down. essentially, guys, the market is not buying this talk from bullard, from mester and others

who keep pointing us towards higher rates and the market saying, no, no, no, you guys are going lower. >> steve, obviously it's four weeks until the next fed meeting. there will be more data. we'll see what inflation has actually done more recently. i do think that that probably explains part of the market saying, look, everything is trending in the direction of weakening economic growth. powell at the last press conference said you know we considered pausing if you consider pausing at the last meeting, what's the conversation going to look like in four weeks? >> well, i think it's going to be -- we have some new data, mike can i talk about the new data first before i answer that question >> sure. >> because it's a part of the answer guys, if we have that chart in the back that we were rushing on air here which shows this big revision to jobless claims guys, we have a new story about what's happening in the job market oh, they're so good back there thank you to graphics. thank you to the producers so the blue line is what we thought was happening in the

claims market. you can see that's kind of flat and then they just revised it and i'm told by the dls -- sorry, department of labor the pandemic played havoc with the seasonal adjustments so this is one of the bigger revisions that anybody's ever seen you can see what the story is there. we were wondering why there were all these announced layoffs and not showing up in jobless claims well, because the seasonal adjustments, we're getting rid of them. now we see a situation, guys, of rising claims. now i have to answer your question, mike, which is whether or not something like this affects the fed. i'm going to take a little bit of a punt on that and say, you know what, let's take a look at the jobs report tomorrow there's some indication that it might be a little weaker than it previously had been, mike. you look at the ukg data or home base data and they're not showing the growth there's the outloom which is 238. i will tell you this

eleven times out of 11, 11 times in a row the estimate has been below the actual number. so the jobs market keeps surprising us to the up side maybe tomorrow is not that if that's the case and you get better inflation data, the fed can take a pause that's pretty much where the market is. i just want to give you a fresh quote here on the probabilities. it looks like it's 60% right now for a pause. that's where we are and 40% for a hike >> well, we've got canada and australia and now india. we'll see if we join that club, steve. talk in a little bit steve liesman this morning a big 24 hours ahead as steve said when it comes to fresh data on the economy we'll get the fed's latest balance sheet numbers. the jobs number tomorrow as claims this morning came in well above expectations. part of goldman's warnings, the number is going to change but maybe the picture itself doesn't change it's about revisions and seasonal adjustments, agree,

don't agree? >> that chart that steve showed did show that inflection point higher several months ago. that's what many have been waiting for saying jobless claims is usually a relatively leading signal of a broader weakening in the economy it hasn't signaled, it hasn't flagged. maybe that's showing it there. it can be a long lead time it can be 12 months. >> i think in addition to all of the data part of the data you were mentioning is the read from the banks which we'll get in the next couple of weeks we're already seeing continued stress certainly we've seen the deposit out of smaller banks stabilize in the latest reading. at the same time you see this fierce competition there must be a reason why first republic is offering 4.95% on a 7-month cd they're still looking to shore up their deposit base. they have to compete against some of the big ones so we continue to see that, particularly if you're looking for a cd rate, a high one, look at the smaller regional banks. they are getting competitive now. >> for sure. you know, the bank results are

going to probably show all of them in we're very liquid. we're building capital we're not extending risk at this point. the question is whether -- and for the hallmark it is, whether we've priced a lot of this stuff. we've been anticipating whatever might be coming in terms of a recession for over a year. the yields today are actually percing up a little bit. why, the 2-year yield was 410 last thursday and now it's 370 something. we've already gone there look at the small caps, they're bumping along. if i look at gm, ford, capital one, yeah, we're expecting a weakening picture. i do think the question is where we are in that reckoning process. >> meanwhile, as for bank lending, goldman cited a study yesterday where they said each decline of 10% in bank profitability equals reduced lending of around 2% we'll see if the two things go

hand in hand that would be remarkable >> that's a good stat. >> sure. >> and powell said, look, we can't quantify it. we can't indicate how it's going to go. the numbers will start to give us something tangible. >> the question is will we see in the broader indices, which we haven't seen so far. it's been largely contained. in the smaller parts of the market that's because apple and microsoft are 13% of the s&p 500. you can't get around that so we're seeing relative quiet here we're seeing volatility pretty calm here. >> yes although yesterday health care was, you know, up big. that's, i don't know, 13, 14% of the index. >> utilities >> there's sort of -- people look for the exit. the exit seems like it's not block the right now. it's been rotating instead of just selling off in a broadway. >> meantime, the nasdaq with the biggest drop in a couple of weeks. key names like tesla seeing some pressure here. let's get to dom chu. >> to that point of a rotation, what we are seeing is that

weakness in the technology trade, specifically in the nasdaq the nasdaq 100 especially over the last couple of days here on a week to date basis we have seen a move down for some of these major nasdaq-related stocks if you take a look on a year-to-date basis, the spdr s&p 500, the dow etf, nasdaq, all solidly higher it's this move lower here over the last couple of weeks here has people wondering whether or not this is the beginning of something bigger if you put some of those broader moves in context, positive for the major indices but this week has been relatively bad. if you take a look at some of the stocks and components driving some of that weakness, three stocks in particular have driven a bulk of the nasdaq 100 and the nasdaq composite's down so far on a weekday basis. amazon is down nvidia down 3.5% tesla down 11.5% to put those market cap moves in context because of those percentage declines on a

week-to-date basis we are talking about a $30 billion drop in the market cap of amazon.com. a $30 billion drop roughly in the shares of nvidia and nearly $80 billion drop in market cap for tesla. call it roughly $140 billion just this week alone in market cap for those three stocks just to put it in context, that's roughly the size of an entire at&t to put things in perspective there. for tesla, again, a huge move lower this week. again, it's still from the basis of a year-to-date basis from the lows, up about 80% from the lows we've seen in january, we're still 50% below of the highs we've seen in the course of the last year. again, a strong move for tesla to the up side this year again, that big down side move is what's cut a lot of folks, carl, melissa, mike a little bit more off guard over the course of the last few days, guys i'll send things back over to you. >> appreciate that. it is interesting in the auto business.

inventories up eight straight months adam jonas has been counting the table on how it's probably going to crack the number of large cap companies that benefit from 4x, for example, is not including tesla right now. tesla is still down 30% from the dollar's peak last fall. pretty remarkable. >> you had gm coming out saying they're thinking they're taking market share from tesla, right all of that aside, if you look at the chart of tesla, anybody would say, i don't know what's going on in the news this stock is going to have a whole lot of trouble getting above 215. it was just this level that just was, you know, a floor for a long time. it's made a couple of runs at it and there you see that's sort of we're in this range where it's bounded on the upper end by what's below that sort of obviously gets into the market cap, the valuation is all playing into that. but to me it's just kind of stuck. if you've been unable to get the retail stampede into the stock

the way it ran it the prior years. >> the first was to go into tech, tesla, nvidia. people wondered when is the time to short nvidia in particular, we're seeing the cracks start to develop here the first derivative trade, maybe that spaert ending at this point because we're not seeing that reflex anymore. rates lower. we go into tech. that seems to be, you know, showing some cracks here. >> as we go to break this morning, take a look at the roadmap for the next hour. costco, of course, is a huge story. the latest consumer name to show some cracks in in the armor. >> plus pnc downgraded but is it time to get back into the banks? we'll discuss with one money manager who says yes. >> layoffs and cost cuts hurting two states this tax season nd ofiut why and where big show still ahead

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disney gain being another critic this morning. julia? >> reporter: well, carl. in a rare interview former chairman of marvel entertainment, not the movie studio, telling "the wall street journal" that disney fired him and that he wasn't laid off as the company has said 80-year-old perl mutter said i have no doubt that my termination was based on the fundamental differences in

business between my thinking and disney leadership, because i care on return on investment he said they cared about the top line rather than the bottom line his argument to cut disney spending drew the support of nelson peltz driving nelson's proxy battle that he waninged against disney pe perlmutter's value has $4 billion in cash and stock. in 2015 iger replaced perlmutter with fieggy. now over the years sources have told me that perlmutter has grown increasingly frustrated with the diminishment in the company as well as with his political differences against

disney perlmutter saying disney should not get involved in politics melissa. >> julia, thank you. julia boorstin consumer discretionary, one of the worst performing sectors. the biggest laggard on the week. down 3 1/2 percent that said, it is one of the best areas of the market. joining us is the second quarter playbook, we have michael banker great to have you with us. i want to start off with costco. you have a hold rating you have a hold. you were a huge fan. what do you make of the quarter and how do you extrapolate the results on to some of the other stocks you cover >> yeah, thanks. great to be here, melissa. no one is going to argue costco is a phenomenal company. based on valuation, trading at 33 times earnings. that kind of multiple, everything has to go right we are seeing a little bit of a slowdown in spending you saw that in costco's numbers today. giving costco credit, this is a great year last year

they've been on such a great run that the comparisons aren't difficult. we are seeing a little bit of a slowdown in spending that's impacting the numbers at 33 times earnings, it's just not very for giving. so love the company, don't love the stock here >> michael, i'm curious how you think about the consumer in consumer spending now versus how you thought about it, let's say, a month ago prior to the banking crisis has anything changed in what you're expecting the consumer to do >> yeah. absolutely great question we are now a little bit less bullish on consumer spending, not that we weren't bullish. we're more cautious now. in fact, our 2023 average comp estimate for the retail lines we cover is the lowest estimate that we've seen since 2008, 2009 in the last month that much more cautious >> i'm wondering what is it in your model that caused you to do that or is it simply sort of a

qualitative thing? consumers are less confident and, therefore, will spend less? are there specific levers that have been pulled or pushed in that model to cause you to rachet down your expectations? >> yeah. part of it is definitely we think there is some confidence or lack of confidence that will occur and show up in the numbers because of the banking issue, but tax refund data, that's a great example, is pacing at the weakest level in 12 years at least right now. so that does impact spending in had the near term. other channel checks we've done, some of our colleagues on a consumer team, it looks like the consumer's not spending as much as they were we'll see the marked retail sales numbers in a couple of weeks, but our view is the model and data checks we've been seeing, it will start to be a little bit softer month than we had expected coming in. >> i keep coming back to, for example, jamie dimon's letter a

few days ago in which he said household balance sheets, i think he used the words, great shape. $1.2 trillion. debt obligations still historically low is there a reason to believe that the dropoff might be slower or more gradual than in prior cycles >> the consumer is spending les and spending on much more nondiscretionary items walmart reiterate their first quarter guidance which means they'll see a 4 or 5% comp that's a good number it's much more on the nondiscretionary side. when i said our comps are as low as they've been since 2008, 2009, we are looking on average at a positive comp costco a weak number but a positive number. this is a little bit of the slowdown than what we've seen in the past years >> michael, you mentioned the

premium valuation costco has always had the big part is the membership revenue. are we seeing any bumps there in terms of membership totals, growth what would you look for there in a further weakening economy as a signal >> the membership's actually been pretty strong, pretty consistent so if that does weaken, we know we've sort of put that in this is a disaster camp we're not really seeing that yet. i do think one thing that this environment causes is it causes costco to push off the membership increase a little bit. it's every 5.6, 5.7 years. that would have suggested an increase a month or two ago, but we think that that might not happen or might get pushed off a little bit because it does seem a little tone deaf to increase the memberships by 5 and $10 right now. >> michael, great to get your thoughts thank you. >> sure. coming up, bitcoin on pace

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there's no question we're seeing bifurcation in the consumer the signature is sold more in the mass channel targeting a price point that's well below levi's red tab, really it appeals to a lower income consumer. those businesses have really been challenged for the last almost 12 months since the middle of last year and we're definitely seeing it in that business >> tlooes view straws's chip bergh talking with sara eisen last month with the challenges facing his business. shares on pace for their worst day since march 2020 profits beat but it was down from a year ago. they are reaffirming a cautious outlook. 15.10 this morning, guys, will be the low of the year we look forward to hearing what he tells jim later on tonight. >> they're talking about

inventories, working that down, impacting margins. we've heard that from a lot of retailers. bitcoin on pace to end a bit lower. it's gained 25% over the last month. we are tracking the action mckenzie >> reporter: melissa, bitcoin and ether lower. bitcoin off more than 1% ether off by more than 2% ahead of friday's job report in the last year it has been macro economic data. the concern is that any signs of inflation in this jobs data could translate into more aggressive rate hikes by the fed in order to temper inflation but as we close in on one month since the collapse of silicon valley bank, it's been a really incredible run in the crypto market overall bitcoin and ether have far outperformed bank stocks since march 10th following the collapse of svb, silver gate and signature banks that dovetails with this narrative. as people lost confidence in the traditional banking system

decentralized digital currencies were a safe haven play they're tracking alongside gold in the last month. meanwhile, ether getting a nine-month high outperforming bitcoin. and dogecoin up 30% on monday. that spike coming after elon musk had twitter change its symbol there's no real utility. we're talking about a meme token created as a joke. doge has pared about the gains. >> mckenzie, thanks. still to come, tough first quarter for the financials as q2 set for a rebound. we'll discuss that next. don't go away.

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seema mody with your updates. macron is on a three-day visit to china both leaders have agreed that nuclear weapons should not be used in the conflict but president xi has refused to criticize russia for its actions. meanwhile, in macron's home country, demonstrators continuing to take to the streets. this is the 11th day of nationwide strikes and demonstrations across the government's plan to increase the retirement age by two years to 64. talks between trade union leaders and prime minister borne ending without a breakthrough setting the stage for protests to continue. back in the u.s. the lsu women's basketball team is celebrating their first ncaa championship with a parade on campus the tigers beating iowa by a

score of 102-88. the game made history by the most points scored in a women's national championship. melissa and mike, back to you. >> thanks very much. just about an hour into trading. major indexes with moderate losses let's get to bob pisani. >> third day in a row the s&p is to the down side there's good news and bad news, mike let's take a look at the sectors. the good news is banks are stabilizing. banks have been trading towards the lower end of trading that was a little worrisome. they have stabilized that's certainly good news defensive stocks, health care, utilities are holding up that's been a story all week the cyclicals aren't bouncing. materials, energy, a lot of the industrials aren't doing too much the banks right now here, all down rather noticeably the first three days of the week but zions, comerica, keycorp doing

better fifth third got an upgrade at kbw. that's a big upgrade the rush to defensive we saw this week, one of the reasons the dow held up is sort of ending today essentially not a lot of big movements here. johnson & johnson, united, merck, amgen, walgreens, stable but not helping the dow that much at the same time, i want to watch the industrial materials i keep talking about caterpillar. it's down 8% this week mosaic got a downgrade from jpmorgan and most of the other names, vulcan. the another materials stock that's been down consistently throughout the week. you want to watch that we have gotten data in on some of the dividends for the quarter. the numbers are really good. we have new records for the dividends. those who love dividends, there's a lot of them out there judging by your emails, the s&p is yielding 1.3% a lot of big companies hiked in the last quarter, oracle,

applied materials, hess, american express all hiked their dividends in the double digit range as you see there we had a dividend hike from fed ex yesterday this is very important are they going to continue this year there's a lot of pressure on the dividends. they depend on the cash flows. banks may have some cash flow problems we'll keep an eye on that. don't sneeze at a 2% dividend yield. a lot of people poo poo it it's a critical return on the overall returns for the s&p 500. when you reinvest, that's the critical point to reinvest the dividends. the s&p returns 10% a year on average but the total return, carl, is about 40% due to reinvested dividends that's a critical, critical component for people to understand that 2% reinvested every year, carl, adds up over the years and turns into about 40% of your total return back to you. >> talk to you tomorrow.

bob pisani. meantime, st. louis fed president bullard said the fed can continue to hike while using other tools to handle financial stress his comments come as they await the latest balance sheet tonight after the bell and the jobs number tomorrow. our next guest says the fed has one more quarter point rate increase jim smiegel joins us here at post 9 great to have you. >> thanks for having me. >> powell has said, more additional firming may be appropriate. >> it may be appropriate bullard reinforced that this morning. we're in the camp we're not going to fight the fed we believe them. the market has taken less than a coin flip that we even get another 25 at the meeting. we think they give us another 25 and pause, not pivot it's all about the pause, not the pivot. >> are you a believer in historical patterns and what happens to the s&p once the 10-year, as it is today, near a six-month low, for example >> that's the most interesting part of the market we're in

today. the market continues to price in this standard reaction function that we're all used to market gets in trouble, fed steps in, cuts rates i don't think that plays out today. inflation is stubborn. i don't see it coming down anywhere close to the fed's target of 2% in 2023, maybe not until later in 2024. so i think the market has to adjust to the new reality that the fed's looking at employment. the fed's looking at the economy. the fed is not looking at the market and the fed might not be here tore bail out the market if we go into a downdraft in 2023. >> you say you see opportunities in banks where? >> a lot of different places this is a broad-based decrease in valuations. consumer finance even capital markets there's risks and certainly opportunities within broad what i would call financials. it's not just about the systematically important banks, it's about all those areas of the fringe, the finance, definitely places to be looking into putting your money at work. >> when you say fringe and

finances, what does that mean? is that fin tech >> it means fin tech, consumer finance. wee don't like to get into tickers per se but those subsector names. capital markets. there are big names have hit some headlines and taken some hits i think there's definitely opportunities out there to be found. >> if you think that the fed will, indeed, be higher for longer with rates, does that mean that they're intent on engineering a much weaker economy at this point, that they really do think you need a purge of a recession to get the job done >> i mean, i think, yes, indirectly, right? we see the economy is slowing. we saw today maybe the employment situation is zgettin a bit weaker they don't want to recreate the same issues we saw in the '70s where the fed capitulated too soon inflation fell and inflation resurged they want to slay this dragon. they're willing to pause and wait and see what happens.

three to four cuts priced in by the end of 2023, we just don't see that. >> yeah. they're never going to say that, right? that's never going to be part of the plan it's a matter of once you had silicon valley bank happening, you had the fed meeting in the wake of that, yeah, we consider that pausing and we don't know what the credit contraction is you have to see the market trying to look ahead and try angulate where this ends up. >> i think the silicon valley situation, that has more to do with the terminal rate, right? if it was 550, 575, terminal rate is 5 1/4. now they wait and see. the biggest issue is, do they cut? what is it going to take to have them take the foot off the brakes and back on the accelerator? they need to wait and see what happens so they can avoid a reacceleration of inflation in 2024. >> how about client feedback are you getting the sense that clients are waiting for, i don't know, a revisit of the october lows will they be that patient?

>> it's interesting. sentiment in general is pretty negative the market doesn't reflect that. >> right there's definitely this kind of tail of two woes i'm looking at the data and hearing the same thing we think having cash in your portfolio makes sense. we're fading the equity markets. if you are a little bit more concentrated, up 15, maybe a little bit more percent. cash is 4% cash is 5% that's pretty attractive we're not in a tina world anymore. second quarter on, i'll take a cash rate as a hurdle over and above equities right here. >> to you think that -- it seems like conventional wisdom and an outgrowth of that general caution, emphasize quality, emphasize defensive balance sheets i do wonder if that feels like there's still any juice to be squeezed out of it. >>, we have a little bit of the nuance, more bar bell.

we're raising cash beta off the table where we are in the market, we still like value we still think that makes sense. if we're correct and the fed's higher for longer, there is a pause, not a pivot i don't think you're finishing the year -- >> we have increased our allocation to gold it is part of a broader commodity exposure gold absolutely makes sense here >> yeah. down today but certainly has had an amazing run in q1 thanks so much great to have you in. >> thanks for having me. all right. still ahead, live sports rights taking center stage for the streamers, but what does that mean for the teams we'll check in with the president and general manager of the marlins. the first and only female led professional sports team they, of course, in major league baseball after the break. stay with us we're back in a moment ♪upbeat music♪ ♪♪ ♪when the day that lies ahead of me♪

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a record revenue season and rolling out new rules. so far the changes have led to the quickest game since the 1980s and higher batting averages joining us now, miami marlins general manager kim ang and caroline o'connor. it is worth noting, the marlins are the first major sports team in the u.s. to have women running the entire organization's day-to-day operations >> thank you so much. >> kim, we can start with the rules. we're a weekend into the season. what are your immediate observations in terms of not just the play on the field, the fan response and does it change anything about how you think about assembling a team? >> sure. i think the rules -- the new rules have gone great between pace of game, the new bases for us, the no shift so we're really pleased about that i think it took some adjusting for the players and the coaches and really worked on that in

spring training. >> does it change anything in the skills you're looking for? can you measure fan response >> in terms of skills, you'd like to see more quickness on the bases. for us personally i think it's great we have john birdie, the stolen base leader from last year we also have jazz chism who is a quick guy. we're definitely looking for that >> i told you the other day, mike, i remember mike piazza came in to ring the bell like you did. there was a time baseball attendance was languishing we asked him, what's wrong with the game he said, it's kind of like a picnic nobody goes on picnics anymore it takes too long. i'm wondering if you think the game needed to evolve where sports and all media is at a different pace.

>> i think people are enjoying the shorter game times we had a game that was 1:57. for me it means kids can come out to a weekday game and be home in time for bed for school the next day i think people are really reacting favorably to the new rules. >> do you think you'll see attendance up. the marlins are 28th among the 30 games in the mlb in terms of attendance >> yeah. we're growing. our attendance was up double digits last year and we're hoping to increase it this year. >> the broader economics you guys are here to play the mets this weekend. we know their owner very well, steve cohen, in this business. he's spending heavily. two pitchers who are paid more than your entire payroll how do you compete do you think there's something structurally okay with that? do we have to do anything to make it more competitive >> i can talk about our pitching staff. i think there are a lot of clubs out there who would like to have any number of our pitchers

we just had jesus go seven innings for us yesterday i think -- i don't think that the money plays that much into it in terms of the talent on the field. i think we've got some pretty good talent on our club. >> cy young winner last year economics of the media part of the game, caroline i'm wondering about this we talked about valley sports, the regional sports network in bankruptcy they carry your games. are you finding or looking for new ways to make sure you can foster a deeper and broader fan base in miami? it's not a small market but it plays baseball wise as small. >> yes south florida is a huge market we're excited about all the baseball fans in south florida we hosted the world baseball we're focused on getting that out there and so we're pretty confident and everybody is

working pretty hard on that to keep that up. >> i remember the day you were named and it was a huge deal in sp sports since then do you consider yourself an advocate for gender equality are you here to do your job and that's it? >> i think all of it i've always been a gender advocate there's no way i could have gone through 30 plus years of this without knowing where i was and seeing the landscape around me and knowing that there were not very many women around so he have' always been an advocate for young girls, for women coming through the ranks just in general in society but, you know, i think in terms of where i am now, i think it's a great post i think it's highly visible and be i hope more young women contemplate coming into sports >> not just gender, but also race there aren't too many asians in football -- excuse me, in

baseball either. in football too. >> in all the sports >> but in terms of being the first female duo to lead the day-to-day operations, do you see this being sort of i don't want to say a one off, but do you see this happening more in baseball or is this a truly unusual partnership? >> i think we're going to see more and more of it as people come from other industries enjoying the sports world. i think you will see more of it. >> when you talk about people coming from other industries, i do think the evolution of the business in general being a little more quantitative, being a little more kind of rooted in different types of analysis. it's not just who did you know coming up, did you play the game professionally in fact, kim, i wonder what you thought of the commissioner, rob man ford, talking about analytics is a dead end, an arms race but said he agreed with it.

it's hard to believe we say we need less information. >> i do think that's hard to say. i think in terms of our analytics, we use it obviously every day. there's always more information that we can gather and i think it really depends on how you apply that information as well >> yeah. on that point, we talk about -- i know this might be a bit far afield, we talk about ai every day now. the market is searching for use cases. do you see it being even larger component of management beyond the so-called money ball era that we talked about years ago. >> we don't see it right now being mainstream in baseball but we do see slivers of it coming into the industry. particularly the medical field. >> really? >> yeah. in terms of prevention of injuries >> yes >> what else >> there's a lot of analogies between sports and trading in the stock market

caroline, i know your brabl is -- background is financial. do you guys trade? are you interested in the snarkts something that you watch? >> i am. i just don't have the time >> well, you trade just not stocks >> exactly >> different kindtrade. >> you're focused on the market of public companies. we look for great partners to be alongside us on our field, so we're here to celebrate with adt and we bring the bell for them, a great partner for us our partners and our industry is focused on the stock exchange, too. >> have you done much in terms of looking around at other teams with modest budgets and what they've done obviously, tampa has done so in your state does everyone already know how they did it? we're looking at the same number and attributes of players? >> in certain lanes, yes i think everyone has their own way of looking at it and that's their secret sauce, so we do we do study other clubs.

>> all right it's great to have you good luck this weekend. >> thank you >> thank you so much >> thank you get a check on the markets here again, markets close tomorrow, so we'll be unable to trade on the jobs number. trying to do some of that in advance. dow down about 130 don't go away. ready to shine from the inside out? say “yes” to nature's bounty advanced gummies and jelly beans. the number one brand for hair, skin and nails. with two times more biotin to bring out more of your inner beauty.

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she has no clue who's in the helmet. are you ready? -i'm ready! alright. xfinity rewards creates experiences big and small, and once-in-a-lifetime. while the rest of the country is seeing high tax collection due to high unemployment, who states are feeling the pain this tax season let's get to details with robert frank. >> good morning. signs of a white collar recession starting to hit the tax revenue of new york and california california tax collections falling 4% over the past year. new york down about 1% the rest of all the states are up 11% new york and california down more than 10% from their peak last year. of course, the falling stock market and the decline in tech wealth partly to blame here,

reducing capital gains revenue but the big worry right now is that withholding taxes are also falling. dan clifton at strategist says unemployment is rising in both states, especially among high income workers, who, of course, pay more taxes bonus income also falling. wall street bonuses down 26% this year. and wealth flight, as the high-end income tax pairs who moved out during the pandemic, that may start to show up on the tax rolls. political pressure growing in both states to raise taxes on the wealthy and tax the rich, a takeover of albany last week urged the governor to tax those making over $5 million a year. so far the governor has resisted but the state is projecting budget deficits growing to $6 billion by 2027. california looking at a deficit of over $22 billion. guys, that comes only six months after california reported a surplus of $100 billion. so, this is changing very fast

>> how much revenue would be raised if that tax for $5 million and over goes into effect >> they haven't scored it yet. of course, it depends on how many people leave. we had 1,400 people who earn more than $25 million leave in 2021 that's the latest year available. that comes after 2,000 of them left the year before we don't have the numbers from last year. this is the big question, if you raise it more, how many will leave and how much wealth creation will we have, unlike 2021, coming in the next year or two? >> robert, i haven't kept track of which states which how many actually did tax cuts because they found themselves with surpluses a couple of years ago, but was california among those >> they gave tax rebates up to $1,000 per person. there are over 27 states that passed some form of more

permanent tax cuts so far they haven't had to revisit those. most states still have a surplus. most states, including illinois, are still figuring out what to do with that extra money as the federal aid they got during covid starts to run out, they, too, might have problems and questions on the budget side. >> for sure. very likely to happen. robert, thanks much. talk to you soon we have all the major indexes down about one-third of 1% "squawk on the street" will continue after this break.

good thursday morning. i'm carl quintanilla with morgan brennan. charles schwab, liz ann sonders with us on the value clash between sec and financials and some early jobs number tomorrow. ben lerer is with us on set at post 9. down