of -- you can't measure it very well in terms of longevity, and i'm happier when i'm eating hot fudge sundaes or drinking coke or eating hot dogs >> warren, we are lucky to have spent the last three hours with you. thank you for your time today. >> thanks for inviting me. >> you invited us, but thank you. joe, we'll send it back to you >> we've got some movement after that cpi number. they'll tell you about it on "squawk on the street. make sure you join us tomorrow "squawk on the street" is next ♪ good wednesday morning, welcome to "squawk on the street," i'm carl quintanilla with david faber, jim cramer here at post nine of the new york stock exchange. big day as mark's headline cpi comes in light, and year on year falls a full point to 5% yields are dropping, ten-year, 3.36%, of course, buffett on "squawk" also lighting up the tape

our road map begins with some breathing room for the fed the latest key inflation numbers showing price pressures eased in march. plus warren buffett says we are not through with bank failures and energy continues to a focus. crude hit its highest level in nearly three months, and the white house is seeking to boost that transition to ev. let's begin with market reaction to cpi today. obviously, a hugely anticipated number, jim, some of the internal shelter up 0.6%, but some relief in used cars, and energy and electricity and food at home. >> yes food at home, by the way, i'm glad you brought that up, because conagra talked about that they had been one of the companies that had been considered overly raising their -- all of their prices, and they said, we're not raising because we're such a bargain versus going out i thought that was really good i often find, though, that, like, some of these things, i just don't know where they pull them off like, where do they get the one

that i thought was most confusing? motor vehicle insurance. i wanted to ask warren buffett that one that would have been a good one. airline fares, absolutely. household furnishings. we see the pressure in the -- you don't want to own a single stock in the household furnishing industry because the pressure is so phenomenal against them, and that comes out to be a problem. so, i look at this, and i say, you know what? other than shelter, which is still definitely an issue, david, if you're going to raise rates because of this, you don't care about this. you're raising them because of something that you see that we don't. >> and what would that be? >> well, i mean, maybe the possibility that we have really gotten over the banking crisis and people don't want to say, hey, it's over, but you're willing to make bets that people aren't going to lose their deposits you feel a little too confident. there's new confidence post-what happened >> so, based on this cpi number, which essentially was in line in terms of year over year and the

estimates, you think the fed's done >> no, i think austan goolsbee was very rational in saying, this is a wait number. i don't know whether waiting is considered to be, we are willing to have the status quo inflation, which we're clearly not, but they need more -- the government needs more ammo than just housing, because housing is proving to be intractable. we had -- i don't know if anyone saw the stocks yesterday, the housing stocks, they were on fire, because mortgage rates are going lower. >> five straight weeks lower two-month low with the 30-year average 6.3% and that's why mortgage apps got a nice tick-up. >> look, if you want to raise rates because you think that that could raise mortgages, it hasn't worked. david, the mortgage price -- there's not -- it's not going up >> right >> mortgage rates aren't going up >> right >> they can keep raising, and

what are you going to do unless you're getting a six-month mortgage, which i don't know how you're going get that this is encouraging my wife to go back into housing >> yeah. >> you're supposed to say, there isn't any level. >> i mean, how many homes can you own? >> we're going to find out >> how many -- >> you're testing the limits, or she's testing the limits >> no, because i'm trying to put a clause through with congress that if after you buy your 15th home, you get the 16th for free. >> it's a loyalty program. >> they do adjust, and that's an issue for some people, certainly. >> you do have to recognize that they need more ammo to keep raising. i think they don't need any ammo to hold. this cutting thing, i just can't go for that. >> yeah, that's the takeaway from the core year on year, 5.6 is the first uptick we have had in a while, so people argue that will push back against the argument for cuts, but market's

still looking at a 60% likelihood of a may hike >> look, i just think that it's that darn wage inflation it's not this. we're still just not' seeing people losing jobs remember, you guys said -- were you there when julie from ak senture was on they laid off a large number, but when you look at how many people they have -- >> they have an enormous workforce. enormous >> and we need to see people -- like, mcdonald's, there's a very good piece today about how mcdonald's is laying off people and adding more stores but the number of people they're laying off is a thimble. >> they are small as a percentage, not to mention, of course, let's not forget, of all the hiring that took place, so you're not even getting down to levels that you had in 2021, for example, at many of these companies, including many of the technology companies that did such an enormous amount of hiring over the period of the pandemic by the way, speaking of mcdonald's >> yeah. >> what is going on there?

>> 12 out of 13 days higher. >> there's no -- i did a piece the other day which said, if you look at mcdonald's, it's sweet greed. >> what does that mean >> this is a tale told by an idiot with -- >> signifying nothing. >> sweet green comes public. >> i'm aware >> $3 billion. >> okay. >> everyone says, this is the beginning of the next wave of kind of natural, organic -- >> look at the 20-year i like the control room giving us 20 years. they were listening to buffett >> it's a great company. >> it's a great company, yes >> but if you fund the sweet greens, remember, that was a couple guys out of georgetown who became billionaires instantly. if you have a lot of money that's able to fund alternatives to mcdonald's, of which there's like five right around here. if you've been to any of the restaurants around here, every one them could come public if sweet green hadn't screwed it up there's not enough competition not enough competition mcdonald's has won

it's just burger king and mcdonald's and wendy's seems to be faltering a bit they won >> your point is that there is not enough funding or not interest any longer in putting up the capital that would be required for new competitors i'm not sure i buy that, but it's an interesting theory >> what's your theory? >> i don't know. i turn to you. >> what do you have? >> this thing is trading at nine times sales. >> i ventured something. what do you have i got nothing but valuation for you, which is, it seems to be getting a little high. >> it's expensive, but remember, i'm going for this -- i'm working on this new nifty 50 thesis >> you have been doing that all week long. >> stocks can just go up >> sweet green is still out there. there are any number of potential competitors. >> i wouldn't put money into sweet green if i knew i wasn't going to be able to get a secondary and get my money back. my piece last night was about the incumbents are winning

because we have no more ipos and a lot of these companies that they're -- they were financing out in silicon valley, are not going to come public, and so the incumbents have far -- they are digging their heels in and winning now, mcdonald's itself, carl, is a fantastic company, but the fact is, there's no challengers. >> they have had pricing power they're stepping on the gas on unit growth. and if you believe that credit tightens, i mean, how many small mom and pop hamburger, breakfast places may not have the runway to keep going in the face of what they can do >> i think it's just their time. and i think that we're going to see a couple companies in each industry that are incumbents that are not going to be challenged because the ipo marketed is as closed as i've ever seen it in my career. >> the point here would be not that these companies don't exist, but their inability to go public and raise additional capital for growth >> yes >> we should just make that point. >> let's say there was a -- >> so they can, obviously, expand >> i don't want to pick on sweet

green too much, other than the fact that i don't really care for their lunch. >> i like sweet green. what's the problem with sweet green? >> i would say, if you have companies that offer a really better hamburger at a lower price, and they were funded by some clown that had all his money in silicon valley bank, but as warren buffett points out, everybody makes money if they're in a bank, they would be able to finance 50 stores immediately, next to mcdonald's, and mcdonald's same-store sales would drop a bit that's capitalism. that's what happens. that company, joe's burger joint, is not getting the money. and that makes it so an incumbent does better, and it makes you more likely to want to own the stock of mcdonald's. >> that's as good as a reason as anybody else can come up with, i'll give you that >> is the burger better than it used to be it's the same. the mcmuffin is still 373 calories >> the qsr, and i don't know about starbucks, but qsr has had

a similar run here >> they've done a good job, but i just think that we have to start thinking about incumbents. they've not -- no one's being challenged, because no one's really coming public and if you bought a stock that came public in the last year, you're probably doing badly. >> all right, but there are private companies that are still fully funded that are still competitive and will come public at some point. >> okay, i'm going to -- okay. i'm going to play it out mcdonald's is up a lot, and i really don't have any idea >> i'm not talking about mcdonald's i'm talking more about technology and areas like that there are plenty of companies that go private that are still competitive and have access to capital. >> starbucks is an incumbent i had -- i had ralph's coffee the other day, which, by the way, apparently, his cologne, ralph lauren, fantastic, great mugs can they beat them the incumbents, david.

to the incumbents go the spoils. my point is that mcdonald's does not have as much competition as you would have theoretically expected in capitalism structure. >> you were broadening it out. >> there are winners that you have -- look, there was a moment in time when all birds was supposed to challenge nike >> you mean competitors with money to burn on research and r&d and capex. >> meanwhile, on is doing pretty well >> that's different. >> why is that different >> because it's better >> oh. it's a company that came public that is doing well >> on versus a shoe that people look at and say, cut it out, dad, that's three years ago. on is roger federer. >> hoka seems to be doing pretty well >> that was a 15-year project, but on has athletics it's indoor. it's outdoor it's tennis. it's the mill rose games it's chic. it's got a new boating shoe. it's big in foot locker. they've got it on has it. they reached a billion dollars in sales in the time that it took eight years for nike to do that so, that's what i'm talking

about. and i were nike, right now, i would be saying -- i would be having a high-level strategy meeting, not that they talk to me anymore like they used to i would be saying, look, by tuesday morning, nike meeting, which is probably, they serve rice cakes, i don't know, i would be saying, hey, how about these guys from on someone else would be saying, let's call mark. let's call buck. these guys are real. how do we stop them? you don't have to worry if you're mcdonald's. it's been stopped by the market. >> all right >> this is so good, if you would just ride with me on this, we would be kings we would be kings. >> i'm almost in the car with you. i'm almost there some of it made a lot of sense >> jim mentions buffett, and buffett is in tokyo today, as you know this morning on "squawk," berkshire's chairman weighing in on everything from markets to the fed here's what he told our becky quick about these recent bank failures >> we're not dealing with bank

failures, but we are through the depositor -- depositors haven't had a crisis the owners of banks may have lost a hell of a lot of money. the people who bought the debt of the holding company may have -- they may lose a lot of money. people can lose a lot of money, but the depositors aren't. so, you don't need to turn a dumb decision by managers into a panicking the whole citizenry of the united states. >> yeah, two big themes from buffett. one was that the fdic structure is misunderstood at large by the american public. the other, though, is that he seems to think that there are incentives that are misaligned in the business, which have great societal externalities, but that's why he sold a bunch of them, ex-bac. >> he said two things that i felt were breathtaking one is he sold these banks, not just wells but banks that i -- >> he sold quite a few, and he sold any number of banks

>> and then taiwan semi. i mean, we had a january 24 election coming up there, of which i think the chinese are -- look, some people feel the chinese elected trudeau. chinese -- they charmed macron they seem to have incredible strength in africa i mean, how do i know that the january election in taiwan isn't going to be heavily influenced by china he sold his stock. >> you've appropriately focused a lot of people on taiwan, continues to be a key area of concern. >> but he likes the company, sold his stock >> he sold taiwan semi, which is the maker of the majority of advanced chips in the world. >> including nvidia. >> including nvidia. it's tsmc. >> you didn't find that -- >> samsung, basically make all the advanced chips in the world. >> but i didn't hear him say, you know what, i'm not worried because we got the seventh fleet and we've got, you know, we've got soldiers and we're going to -- i didn't hear that at all. >> well, berkshire's still a proxy for apple, which relies

on -- >> apple is by china, for china. this is -- >> listen, if there is actual hostility in taiwan, it's going to affect everything across the board, horribly. >> i got news for you,partner. >> tell me >> it's not about hostility. it's about co-opting it's about hong kong there was no military takeover of hong kong you take a january cut you take one of the -- you know, there's going to be someone running, number two, and they say, listen, we're more open-minded about china and perhaps we have to stop the drum beat next thing you know, china's -- we're looking the other way because we've got our plan to put two nanos in arizona, and they say, you know what? let's have a little peace in our time let's split what they make at taiwan semi, and you know what our president says "okay. >> chinese do need and do not have access to advanced semiconductor chips. >> well, i'm just saying

>> it's a very small percentage of the total that still comes mostly from the u.s. and other places, certainly the design >> i'm going to blow you away with a ukraine analysis too, if you press me >> we'll look for that later when it comes to geopolitics, you're my first stop >> the good guys are on the run. >> i wanted to make sure i heard you properly, because i don't understand what you're saying. >> it's very possible that it could be a hong kong-like situation in taiwan. that's all >> in taiwan >> well, when i listen to what warren buffett said, i did not come away with great comfort he sold taiwan semi. he didn't buy taiwan semi. my ukraine is because i have aaron on tonight >> i know you've been all over that one we'll get to buffett, talking about the rails, the future of berkshire and greg able. we'll get to tom barkin, even as we digest what was said

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all right, we get started with an opening bell about eight minutes from now at the new york stock exchange let's get to a "mad dash." always good to talk about the second largest market cap company. >> indeed. it's overlooked often. dan ives has a piece today, saying, listen, cloud checks are holding up better than expected. people have been saying that azure could be challenged, and we're talking about -- i've spoken with government doeals, saying they could hit the low 30s. i think that azure is slowing more than that, but i do want to point out our friends on "squawk

box" tomorrow have andrew jassy. >> ceo of amazon >> yes, and i think that -- >> still a leader in the cloud >> but if jassy talks about, say, a plus-15% and no better for amazon web services, then you're going to regret that you paid microsoft, and i happen to like it, big position in my travel trust i just don't want jassy to bring down the group, but i think jassy was very circumspect on the last call. >> how does that figure into the economic slowdown or the new spending paradigm, so to speak, in technology? >> well, i think that people feel like now we're kind of full up, that all that we needed to build out, we've built out you saw the labor department numbers, saw data and warehousing where the weakest part of the whole economy, in terms of job hiring, job layoffs, i'm very concerned about cloud, because cloud is still supposed to be the number one generator of growth in tech. >> well, certainly has been for this company over the last, let's call it, five years.

this right here, though, is chatgpt. >> oh. >> sorry >> you had the research too? >> no. >> i was going to say, you see this right here? that's a result of chatgpt >> we know that. >> chatgpt, i mean, look, i've been playing with a lot of chatgpt, and the uses are so insanely easy, and the number of people who can be laid off, so incredible i don't think -- i mean, i've been focused on the layoff side lately i think any company, when they say they're bringing in chatgpt, that's a canard. what they're regular saying is, who can we fire because chatgpt does it better than x? and that's good for microsoft. because you sometimes need -- look, you can go to nvidia they have their own division that will help you but maybe you go to oracle, and microsoft saying, listen, what are you hearing? what are people doing? what are they getting rid of that's going to be a very big lane of layoffs for the fed. they should be thinking a little more about it. >> there's always these larger questions about every new

technological introduction seen to potentially eliminate jobs but ultimately does not. >> or creates jobs look, i just think that this is a very contrary call to what i expected to hear from jassy tomorrow >> all right we got a lot more, of course, including that opening bell five minutes from now by the way, don't forget you can catch us any time, anywhere, if you want to listen and follow the "squawk on the street: opening bell" podcast.

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the opening bell is brought to you by nuveen, a leader in income, alternatives, and responsible investing. >> we believe the bond market is going to happen pretty fast. if the bond market is indicating that over the second half of this year, inflation should fall quite quickly, so much so that the federal reserve will then go and start cutting interest rates. i'm not as optimistic as the bond market. i would see us getting somewhere in the middle threes, i hope, by the end of this year, but on a nice solid path back down to 2%. >> that's minneapolis fed president, neel kashkari, about

the bond market. former dove who turned hawkish the last couple of years jim, he did say that he did see calm returning to the banking sector >> and a lot of us want to see that because we don't know what's going to happen with lending we're getting some lending figures, by the way, that show -- i think we'll find real numbers that show very soft. i guess, carl, what i'm kind of m mystified about is, why are these people so willing to comment without more data? i propounded a thesis about mcdonald's to my friend, david i did not say, this is gospel. i think we all have a right to propound these people don't propound. they pronounce they're very different to propound and pronounce are different. and this is what is the truth.

because -- >> they don't have the data. >> i mean, you've got to -- you've got to say it's possible, it's possible. they seem to be -- >> goolsbee siddid sort of say, did have that attitude >> oh, no, goolsbee, i thought goolsbee demonstrates prudence not that long ago, a bank that could turn out to be really big blew up, and we don't want a second >> well, we're going to have seconds eventually that's what buffett said today >> well, here's some chants of "uconn" today because at the big board, it is the 2023 men's ncaa basketball champs, the uconn huskies. head coach dan hurley. at the nasdaq, it's our colleagues over at comcast and nbc universal telemundo enterprises kicking off the hundred-day countdown to the start of the fifa women's world

cup, australia and new zealand 23 telemundo, the exclusive spanish language home of the tournament. peacock's going to stream all the matches live in spanish beginning july 20th. our friends, mark lazarus, valerie and andre. >> can i point out i watch them so much more fun >> it's better in spanish. >> the level of excitement of the game is matched by the people who tell the story. >> here we are back at 4,130 if we say, got back to 4,200 >> we've got a couple takeovers that i think are making their mark a little more jiggy than i thought. david, you see a couple that are of import. >> there are two there's one called triton, but there's another one we've been watching closely, and that is emerson, and his pursuit of national instruments that began last year, remember then, they came public with what was a hostile bid, an

unsolicited bid. initially, they were going after board seats. they owned stock they bought 2.3 million shares, and this morning, they tied the deal up, and they tie it up at a price that was higher than what they had wanted to pay remember, in fact, i had reported they made it very clear, we are not going to put a six in front of this number. well, guess what they did they put a 6 in front of the number, although their actual price, because they bought those 2.3 million shares at a lower number, when you add it all up, well, they're paying a little less than 60 for themselves for the shares they will own but you, as a shareholder, you're getting 60. don't worry. 60 bucks, all cash why did they pay it? well, it was competitive yesterday, we told you we thought key site might have been there. unclear whether they came through with a bid, but fortive definitely did from what i here from people familiar with the process, they were there at the same price, essentially $60, so emerson can

say, this justifies paying it. fortive is a smaller company, smaller balance sheet. might have gotten them to a leveraged ratio of as much as 4.6 times. that's pretty high so, if you are national instruments, perhaps you say, you know what? given the financing markets, given everything else, why would we take a risk with $60 from them when we can get $60 from emerson? so, they've signed the deal up, jim. leave it to you to opine on whether or not this is a good deal, a bad deal, a good price or not but they got what they have been after, and they were after it for quite some time. >> i had a meeting with my team this morning, with jeff marks from the club. ben soto's the research director at "mad money," and we own it -- we own emerson for travel trust, and here's what i'll say i cannot comment, on air, about how i felt about this. >> i don't -- because you would start cursing?

>> yes >> and it's just not right it's inappropriate >> you don't trust yourself. >> it's inappropriate for me to go down the path of starting to talk about it. >> can i at least explore as to why you would feel so strongly >> i thought it was low 50s or walk away. >> why >> oh, see, because they said it >> okay. >> see, when you say it, and then you go against it, i find what that comes to as gene hackman once told me, is you've been had you see, i've been had >> their argument would be they -- >> i was stupid enough to believe. >> they called it 30 >> maybe there are some things they can make me feel better about. >> i would say, jim, at least the initial reaction of the stock price is not particularly negative from emerson shareholders >> only down $1.50 if it's accretive, as they told me over and over again, this stock might be up. the stock was in the low 90s when they decided to go after this in a hostile -- no. i'm not going to go down this path

i already explained to my team that i would not go down this path other than to say that i think they overpaid, and i'm not sure what kind of value they really got, and i'm not sure that they know the consequences of going hostile and what it means in terms of the people that they're going to get to keep the fact is, the stock is the ultimate arbiter, not jim cramer, and the arbiter is speaking >> there it is and your point is a good one, which is that the stock was higher as well >> much higher >> before they launched the hostile bid, which is back in january. they're talking about $165 million they've ooidentifid what they're calling cost syn synergy opportunities through year five. >> year five >> now, again, jim, it's an $8.2 billion deal. >> they could have bought back stock. they traded as accretive they tested measurement. business has historically been good we know that does it make sense in the broader scheme of things when they had it a year ago, maybe.

i'm beginning to wonder whether they know exactly where to go with this. i know where i would like to go with it, which is out of it. >> well, don't forget, their effective purchase price is 59$.61 $59.61 because they bought those shares in the 30s. fortive wanted it at $60 doesn't that say to you that there was competition and the valuation may be justified as a result of another company saw opportunity? >> the stock is now down horribly from when this whole process started. maybe this is the beginning, and the resurrection, lazarus-like of emerson but i'm confused act what emerson really wants at one point, i thought they wanted to help redo the grid, but they're not as powerful as, say -- they're not as powerful as ge when it comes to the grid. or eton. so, now they're moving into

this they've got this aspen deal, which is off to the side i know this is david far's legacy i know that when he previously -- it's a "show me" situation. how about that >> all right >> but it hurts. it hurts, because when you buy a stock, this is something, when you buy a stock, i'm very public about what i do, because in the travel trust, and because of the cnbc investing club, and i'm mortified because i bought the stock in the low 90s, and i know a lot of people come on tv and they're never going to say, wow, i didn't do a good job i'm saying, i evaluated, and i did not do a good job, and i wish i did better. at this point in my career, i wish i did better than taking this beating >> it is interesting, in light of pretty good performance this morning in some other industrial names, honeywell, for example, jim, a catalyst buy over at goldman. >> a hideous performer since 2021, down 30 points i own that, but i've owned that for a long time.

but he's retiring. they've done a lot of great things the stock is very undervalued. that's a good thing. >> piper offering a bunch. >> very interesting piece because they said it's not a matter of demand it's the actual raw cost, and i thought that was very -- i've been waiting for that call to be made for a long time, because we are the lowest cost producer of so many different chemicals. it talked about how we have an advantage in america because of our natural resources, and i think that dow, by the way, is a very inexpensive stock >> you mentioned deals, and we have that other one that we should get to as well. that's triton international. this is not a deal that was leaked or aware or made aware of in the marketplace at all, so you do see 35% -- it's a 35% premium overall. brookfield infrastructure, it does trade it's part of, you know, brookfield itself, an $800 billion in assets now under management in terms of -- >> and we don't talk about it nearly enough. >> we don't.

brookfield is a powerhouse, and brookfield infrastructure and a number of other areas, private equity, are very large this deal, total enterprise value, 13.3, but there's a lot of debt. it's about a $4.7 billion equity value. so, let's not get too carried away, but a good day -- by the way, what they own, triton, world's largest lessor of freight containers over 7 million, 20-foot equivalent units >> look at what railroads are doing. it's all intermodal. this was an asset that was sitting there, going down, because people felt that container prices have been going down obviously, 80% decline in the cost of going from china to here i think this is a brilliant countermove. i really like this deal. very much. >> brookfield is down. there is a stock component here, we should point out, as well it's $68.50 in cash, and $16.50 in bipc's class a exchangeable shares there's a collar here as well, 4,236 to 4,923 on bipc shares. that means you maintain the

integrity of the overall price >> in that case, you would expect the stock to go down. >> potentially it's some stock component, so there might be some people setting it up. but again, we got some m&a yesterday, you asked today, we delivered a little bit. >> m&a and no ipo equals higher stock market, regardless of that devastating series of wells fargo 10% correction coming. >> oh, the chris harvey stuff. >> man >> yeah. >> i read that and was, like, wow. i disagree with that >> it was interesting last night, yardeni, pretty reliable bull, who has argued for a long time that october was the low, said that if the fed continues to hike, we'll join the bears. >> i was talking with my team, and jeff marsh said, wow, he's where you are, and i said, i like to think because i logged that work, i'm where he is i respect his work immensely, and i thought that was very cogent analysis. he's very thoughtful he did not make that -- that was not an idle, like, look, they do

it another quarter it was, like, no, we're skating on thin ice here very good piece. very powerful. >> in terms of negative announcements today, american, what's up with the -- american airlines, down beat profit outlook, jim >> ahead of delta, which i think going to be good tomorrow. i mean, delta, i don't know. we got to do some work on -- what is -- why are they not making more money? >> my god, i took seven different flights in the course of, i don't know, eight days, nine days. every single one was packed, packed, and the prices are incredible incredibly high. >> they're part of the cpi no one can figure -- it's the great conundrum is how could you have a business where there's never a seat and they're just p perma shorts >> these have got to be record quarters for the airlines. every seat's taken, and they're charging a fortune i mean, i'm just saying anecdotally. >> that's like, you know -- >> they can't grow

they don't have enough workers oil's gone from $68 to $82 >> they have old planes. they don't have enough gates it's a very hobbled industry the banks and the airlines are two industries that just don't make you a lot of money, even though you would think they do, given how much they're making on your deposit and given that you can't ever get a seat and every plane is full. and you're -- you have to wear a mask because you're so close to people >> nobody was wearing a mask at all, and i was all over the place. >> really? >> yeah. nobody no masks in sight. that's over. >> yeah, exactly distance >> those days are over, man. >> i'm so glad we started -- were you like dr. schweitzer or something? i got dr. topal. >> his days of relevance may be declining. >> i was going to drop my mask, but david says i'm a-ok. >> i'm going to give you a big

hug later. >> let's talk a little paramount. >> buffett said he didn't like streaming. >> if you want a reason why berkshire owns paramount, which we've talked about, it's dollar-wise, not a big stake for b berkshire. if you took a listen to him, i'm not sure you get an idea as to why they own the stock >> you are too much. >> when it was distributing -- prod producing movies, and you have got some people that have got deep pockets that aren't going to quit. and the product they're offering people, a chance to watch all those movies, you know, for peanuts and all that, but then they raise prices. we'll find out so far, they haven't been able to they've been able to track subscribers, but they attract them at a terrible price >> you give a whole lot of reasons why not to buy paramount. why did you buy it >> well, we'll see what happens. >> we'll see we'll see what happens >> that was unscripted >> i got to believe that --

>> that was unscripted >> yes i asked bakish as well, ceo, do you talk to buffett? no my guess is they think it's going to get taken out that's got to be the reason. >> what price would cherry sell? >> i don't know. near-term question is the dividend the company is in a potentially negative cash flow situation they get upset when i say that cost almost half a billion dollars a year why are you maintaining the dividend well, in part for sherry we have the event from warner bros. discovery. >> what's going to happen? >> we know everything that's going to happen. >> come on, it's azlov there will be some excitement, pizazz >> joining cnbc during the course of the day. you're going to get the $16 option that combines discovery and hbo max. >> how about the cnn master plan >> they're sticking with their streaming. profitability is the key question here. they're still saying they're

going to do $11.3 billion in ebitda this year a lot of that's goip tng to be c half >> but paydown will be substantial. >> the question is also free cash flow. that's the key, jim, as you know for the company generating that free cash flow that zaslav has pointed people to so many times in contrast, for example, to paramount. >> meanwhile, "journal" has this piece of subscription fatigue. for two quarters, cancellations surpassing growth in all kinds of digital memberships >> what are people doing with their time >> we get netflix earnings on tuesday, i believe >> i saw some people this weekend that were reading books. mostly on tape, don't worry. >> a lot of people, audio. i still just read books. you do too >> i listen to music while my wife has the books on tape, all these women's books, which is, like, i don't know, you know they always have, like, i don't know -- i don't get it >> what? >> there's, like, men's books and women's books. that's what we've come down to you don't think that's true? they read fiction, and we

read -- i don't know >> biographies >> i try to listen it's like, and she did this and he did that. i don't know >> i read some fiction too sometimes. i read fiction mix it up. >> yeah. >> steven king >> some nonfiction this morning, s&p, 4,125 we are going to get fed minutes this afternoon we'll see what officials thought about some of the bank stresses during the month of march. two-year has worked its way back almost to 4% we'll be back in a moment. starting a new chapter can be the most thrilling thing in the world. there's an abundance of reasons to get started.

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shortness of breath... and irregular heartbeat could mean something more serious, called attr-cm a rare, underdiagnosed disease that worsens over time. sound like you? call your cardiologist and ask about attr-cm. watch shares of siruis and apple today. influential tech observer says there's a solid state button, jim, on the iphone 15 pro that they might be discontinuing, and that's put them in some risk >> that would be shocking. i know tim cook wanted better sound quality.

this would be shocking >> we'll watch that. they were down about 12% premarket. apple, roughly flat. the dow benefitting from industrial trades to the upside. 135 we'll take a short break, back in a minute.

joining us first on cnbc at post nine after ringing the opening bell this morning and celebrating the ncaa championship, yukon's men's basketball coach and the governor of connecticut is with us march madness is full of surprises but were you surprised by some of the wild games going into the 16, 8, final 4? >> yeah. i think we always believed in the team the team started out at such a high quality, really november, december, february, march, april, we were clearly the best team in the country. i guess it was a little surprising that we won so comfortably in every game where we never had to shoot a buzzer beater to win, they were that dominant. >> the whole game has changed with name, image and likeness and you can transfer

will your office be flooded with people who transfer? >> yeah. i think the benefit of this system, obviously you wish you had maybe a little bit more guardrails in place, but, you know, the great part about the system if you bring tremendous value as a player, you can take advantage of that. obviously we have a culture where we never wanted to be the reason why a player comes to uconn. we never want to lose a player because of it either >> i just ask you, we spend a lot of time talking about artificial intelligence, governor and i've known you many years, i know you convened meetings at the highest level saying we need to save money for our state. how this has saved money, any results so far >> one thing we had 45,000 people in downtown hartford on monday, people looking at uconn thanks to dan

hurley and his team. and that energy rubs off on the state of connecticut i'm interested in economic growth if i get young people thinking about the state, businesses thinking about the state and dan hurley and his team were part of that. >> athletic did an amazing piece about you awhile ago just your family history, your dad, the pressure to succeed in a business where your predecessors had done so well. was there a moment you thought this was not for me? i have to find something else to do >> i'd say a bunch of times throughout my career as a player and as a coach i faced a lot of adversity my playing career didn't go the way i thought it would especially when you have an older brother who's so amazing your dad is a hall of fame coach doesn't feel like you're measuring up in either way but you get to this point, climbed a mountain and accomplish something few ever did, win a national championship i feel i have my moment in a

family that pushes each other. >> how long do you have to enjoy it before you worry about next year. >> post game -- >> an hour. >> i got back to the hotel and agents you get to enjoy it, but really it moves to the next thing really quickly some time in like late may. >> it's a shining jewel for the state, wouldn't you argue, their program? >> uconn is a shining jewel. they are the best at research when it comes to advanced manufacturing. we have pratt, electric boat, heart and center is uconn. and dan hurley believed in this team five years ago, at the start of the season and that gets us over the finish line. >> no doubt. >> i want to ask you, governor, we deal with a lot of people who are wealthy, and wealthy in your state. every day i meet someone who says, you know what, i am now six months and a day in florida the heck with connecticut, new york isn't this overdone? how do you get these people

back >> we're talking about uconn husky's basketball and you go to taxes. >> i'm from pennsylvania we're a great state too. come on, give us a shot here it is our -- do you see anyone from -- you know, do you want to talk masters give me a shot >> i'll give you a shot. >> we have the same differential with new york today as we did before we had an income tax. we'll have the biggest tax cut in the history of the state if the legislature does it job. we have the best schools in the world. sometimes they get older and crankier, want to go south and i want them to stick around. >> i gave you a chance i know you from college, i gave you one. >> coach, congratulations again. great having you, please come back. >> tonight. >> we have the governor of connecticut about how great connecticut is i want to talk about

ukraine, it's on a lot of people's minds >> we'll take a break, dow up 142. more squawk on the street in a moment good night! hey corporate types. would you stop calling each other rock stars? you're a rock star. you are a rock star. rock stars. please! do you know what it takes to be a rock star? i've trashed hotel rooms in 43 countries. i was on the road since i was 16. i've done my share of bad things. also your share of bad things. we know that using workday for finance and hr makes you great at your job. but that don't make you a rock star.

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good wednesday morning and welcome to another hour of "squawk on the street. i'm sara eisen with carl quintanilla and david faber. live for you from post nine of the new york stock engs exchange the s&p 500 up .2. dow up 115 tech lag, nasdaq unchanged after consumer prices come out up 5% from last year, which is a moderation from what we have seen at the 6% level only .1% increase in the month of march cooler cpi is better news for stocks in the economy. 30 minutes into the session. three movers, microsoft, goldman sachs calling it a top pick this morning. web bush raising the price target to 315 to 290 emerson electric slumping. in an effort to boost the

company's automation capabilities making a bid to buy another company. mcdonald's up in 12 of the last 13 sessions hitting fresh all time highs this week that's the environment we are in, a slowing economy. want to dive into the cpi report, which was the big one today. the .1% headline month over month that was less than expected, that's good news but core if you strip out food and energy was up .4%. again, improvement but still speaks to the fact that we have an inflation problem and places in the economy where inflation is still too high, namely shelter which is a big part of the services inflation and services is what the fed is targeting so up .4% leave you with that month over month still high better than the spring of .5%, .6% but probably higher than the fed would like it. >> big drop in rent relative to recent months. and we know rent lags, right as does employment

so maybe some of these things that usually take longer are finally starting to show. >> the pausers on the fed. those who want the fed to stop they'll say rent lags, yes that's a big thing there's progress i didn't mean to point out the high parts of inflation. food at home, graoceries, it wa a negative number down .3% for the month. a lot of that was eggs getting real deflation in eggs >> cereal still a problem, cereal and baked goods white bread, that was a 1% increase month over month so surprisingly strong. we saw a lot of relief if you go through it apparel is still growing but less so. i don't know, david, maybe boys or men's shorts and pants, that was the biggest jump in march in pricing.

5.6% jump in the month a lot of men went shopping. >> apparel overall up 3%. >> i think it's sales. >> what does it mean in terms of the likelihood of getting another increase at the next meeting. >> according to the market still betting on a 25 basis points hike in the may meeting. chances came down from 80% to the 70s% but the market still sees it as justification for a move in may. what does it mean beyond that? is there enough evidence building now that it can be a one and done, that they can wait, see the other signs building in the economy of weakness and cooling and we continue to get more evidence of that we have the bank of america credit card spending data from march, .1% from last year increase the lowest spending since back in 2001. so there's evidence that lower wage growth and other factors, lower tax refunds is finally

slowing down the consumer. and that's ultimately what the fed has been trying to do. here's a quote credit and debit card spending per household moderated in march. lowest pace since february of 2001. >> we are waiting to see the mini banking crisis in terms of credit tightening and what that means. i think the question is how long it takes to have a determination on what that means. >> there's evidence building that lending has slowed. right. especially at the regional level. you've seen that in the balance sheet data from the federal reserve. how acute the crunch is going to be we don't know but everyone, including the fed, expects it to happen. >> yep >> bank earnings will be interesting on friday. >> they will we'll get some color certainly in the q&a and we have j.p. morgan i believe on friday. we should get some color in terms of the lending environment. in terms of certainly what they've seen in deposit flows. you know, we are -- certainly

we've had a quieter period these last few weeks which we're thankful for and many are in terms of the regional banks. $42 billion in deposits left silicone valley bank in four hours. that's reverberating in the minds of ceos of banks. >> headlines from the vice chair of the fdic saying we need data faster to help the bitters jump on the train that was the big part of the obstacle, the delay of the data flow. >> the fact that we never got a deal is questions. i think there are questions what they would do if something like this happen again. would uninsured depositors be bailed out warren buffett's comments that a few bad mistakes should not lead to a decline for the public but what's the fdic going to do if this happens again >> it's a great question i don't know i don't know that we fully adjusted to the reality of the

current moment which is different than 15 year agency. again, washington mutual had i think 8 billion in deposits over a 4 day period and it was seized by the fdic. i'm not sure how the fdic deals with this. it was in part by social media, the ability of people to withdraw money in seconds, via their phone. it's kind of a new world and so it will be interesting to see how the regulators choose to deal with it longer term but short termer term they hope things have quieted. even if we see one more seizure, still may be possible. not an expectation of a lot of them >> what's happening with first republic are they going to sell it? >> they delayed earnings as you know stopped paying the dividend on preferred. they're just waiting it out to see. still a hole there in terms of the potential buyer. this is the issue throughout you have to take a hit to your own book value because you have

to write down the value of the assets in a significant way. and so, you know, i use that term zombie bank we'll see. >> i want to bring in steve liesman. with your take on the morning's data and where we stand right now in terms of policy expectations >> if if you don't mind i want to play a game it's called the if you squint you can see it game. let's look at goods versus services okay what you see is that services has firmly sub planted goods as the source of inflation in the economy but squint and look at that tail off in the white line coming down just a bit at the end of the graph there that's some of the optimism that you can gather the year over year rate for services, it's services, x energy and i want's come down a bit. i want to do another installment of this game

look at services or core services versus wages. and again you can see both of them starting to come down where do they need to be they need to be where they are on the left-hand side of your screen there, which is in the 2% range. but it's that topping off and coming down that is a source of optimism so if you look at how the market reacted today. look, for example, the january fed funds futures. it came off a bit. it had been elevated, up quite a bit, and then it's come back down just recently and about halfway back to the rally it had. what's in there, sara, i think you know, are at least two cuts, maybe even three from where they think the fed is going i think that is suspect. i think the market is going to have to come more to the fed but it depends on what you guys were talking about, which is the banking situation. >> i thought it was interesting, fed -- fed steve. we'll call you fed

that we had commentary from the new chicago fed president because he did not follow the line we have heard from most of the other fed presidents caution i think he talked about. seemed a little bit more nervous about what was happening in the economy and the banking system where everybody else has been eye on the inflation ball. >> you're right. and that's why i'm. ing to i'm going to be on the edge of my chair at 10 :30 when you talk to barcan there's the quote, we should gather further data and be careful about racing rates too much this is the key, i don't think, they're ruling out another rate hike i think he's talking ant going too far from here. he's made a bit more of potential down side of banking or credit tightening situation than perhaps john williams did who said i'm looking at this but i don't see it yet

>> i know. and everybody said your own data from the new york fed showed that consumers are nervous about credit conditions. so they're going to have a lot to debate about this because as david mentioned, the data is slow here when it comes to what banks are doing and lending. >> i can tell you a story about that, sara as soon as the silicone valley bank thing broke i started calling up former senior fed officials who left the bank and asked them, what did you do in the great financial crisis to understand the credit channels and how credit tightening was going to affect the economy? about three or four of them told me it was no good data, it was all late, and up in of it was really very good so it is an issue to understand. we're watching the weekly banking data the weekly fed balance sheet we're trying to listen to anecdotes. there was a dallas fed survey. but to understand the impact, you have to look in the rear

view mirror and that's a problem for the fed. >> thank you, fed liesman. >> fed liesman new nickname. >> thank you. i think the squint to see turn up in goods a lot of that was men's shorts and pants. >> you're aware of the men's shorts and pants. >> it was a weird jump as we head to a break, here's the road map for the rest of the hour. na gas hitting highs as warren buffett warns the world can't step away from natural gas just yet. >> we have the interview coming with thomas barkin reacting to today's new inflation report and more and marc lasry this hour with his insights on everything from the banking turmoil to investing in china holding the opening levels here at 3140. don't go away. did i say chicken wrong?

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it's an enormous problem, an ever-present problem and really needs somebody that understands the dimensions of it and what can be done with carbon capture, but you will not -- you will be producing more oil five years from now or about the same amount, and if you spent trillions of dollars now, you'd still be needing it. you can't change the world that fast

>> that's buffett this morning on squawk talking about oxy, carbon capture, the shift to clean energy saying it is going to be a slow burn. still a key holding is oxy as it continues to pump oil, planning to pull carbon out of the air. joining us is john kilde great to see you we have crude pretty much the highs of the year. everyone says look out for predictions of 90 to 100 is 83 a good stop? >> fri think it is. the move by opec last week to announce a cut, the market was short at that time, so they timed it well. the proof is in the pudding. historically, opec does not have a great track record in terms of trying to rescue the price by cutting. and we're seeing the saudis, for example, who led the charge here

are going to maintain the crude oil volumes to asia where there's a battle between them and the russians and other opec folks for market share with china. it's not all bad news. i don't think it's an automatic run to 100 i think we have to have more problematic issues to hit the tape so i'm trying to stay calm about it and carry on, as they say in the uk >> sounds like grant holmes we want to refill to pre-ukraine levels is the timing on that kind of commentary odd given the move we've had? >> i think so. supposedly opec members' noses were out of joint. xi has been flip flopping on this saying it would take years to refill it to make a meaningful difference

in terms of filling it you have to go the other way releasing it, 500 to a million barrels a day to refill it so tinkering around the edges isn't going to do anything, not placate the market certainly we'll look through that and not price in anything meaningful from an engagement of filling the spr. so a lot of moving parts here, but opec plus clearly worried about the economic outlook and what the central banks are fryif trying to engineer in terms of a slow down and they had to do something. usually the saudis at some point throw a fit and instead of cutting on their own, leading the charge, they flood the market with oil, collapse the price and try to put the marginal players, more expensive players out of business like they did in 2020 >> finally the point about the transition taking longer than we think. we had a poll yesterday saying

four out of ten americans are considering buying an ev at the moment and then you have conco at the moment averaging 4, 5% for the next ten years >> yeah. it's not going away, any time soon occidental, chevron and exxon are embarking on trying to get massive carbon capture going a way the oil companies think they can stay relevant and in the game by embarking on a half it all policy, produce oil, use fuels the way we do from crude oil, and then in addition to that, pulling the carbon out of the air, sequestering it and offsetting the damage to the environment to the extent you believe carbon does that that's their way to keep a seat at the table and they are spending as you see with oxy quite a bit of money because they want to do it at scale.

to make a difference, darin woods will tell you it has to be at scale. >> good round up john of all things going on in energy. see you soon thanks >> thank you so much thank you, carl. let's stick with energy at least broadly speaking the biden administration is proposing the most ambition vehicle emission rules that we have seen to date. our phil lebeau has the details for us and what it means overall for what is the continued growth in electric vehicles phil >> david it will be growth in evs. but i'm not sure we're ready for the type of growth the biden administration is talking about. i'm not going to get into the details of the science behind the proposal for 2032, but this is what it comes down to they're measuring co2 grams per mile and they're proposing between 2027 and 2032 that will come down. that measurement per vehicle will come down 56% automatics decide the technology

mix, do you get there through evs, more clean burning hybrids? you ultimately make the decision as an automatic but the biden administration say most do it through evs and 67% of the annual sales of the country. their projection will ultimately be evs come 2042 they've been tracking the ev conversion, they are forecasting what they expect based on their clients they think at most we get to 50% by 2032 tesla leads the market that's not a news flash here sells 62% of the evs in this country. will it be able to continue selling at this rate they're not impacted by the emission changes gm, ford, stellantis, the legacy automakers are imimpacted by ths and already committing $80 billion to evs nobody thinks the legacy auto

makers will be able to sell two thirds of their vehicles being evs by 2023. ambition goals by the biden administration >> interesting, phil beneficial to tesla it would seem as the leader, right. even though elon musk and this administration do not seem to get along very well. >> right and it all comes down to how you ramp ev production for automakers can they move the plans as quickly as the biden administration would like them to >> phil, thanks. as we go to break, let's check the markets here pretty much in a tight range since the open, 4130 roughly dow up to about 200 on good industrial bids regarding individual components. more on today's biggest movers after a short break.

. we are just a little under an hour into trading you can see we are up across the board with the s&p up about .4%. let's bring in bob here and get more insight into what's moving in the market this morning. >> it was as good as you can ask for in that number trying to break out in the trading range we're on the edge of doing it. doing it with cyclical stocks. energy stocks, material stocks and industrials. there's your classical big three. banks are flattish to down a little bit of disappointment, tech is holding. but the big tech ames. semis are not breaking out much anymore. nvidia has been sideways for weeks now. i guess that's expected with the runup. industrials are doing great, deere, eaton, couummins they'reo a tear these medical device companies

have been on a tear for days, zimmer, boston scientific. stryke, vertex the problem is it's a valuation problem. at the levels we're at, we're trading 18 times multiple and guys, that's pricy you have to believe we're not going to have any serious recession to believe in the numbers right now. the average about 17 and in a recession multiple, a good thing to use 25% lower so 11 to 13 is a recessionary multiple, you play with numbers around 12, you're in the low 3,000s now that's what the market has. >> you get an increase in the fed's balance sheet and expectation the fed is going to cut rates. >> and then things go higher. >> yes you have to believe in the no recession scenario that's what the implication is >> earnings starting friday basically with the banks how important is the earnings

season in terms of the multiple you're talking about and the guidance we get. >>earnings recession, facing two consecutive quarters of downward earnings and the second quarter is down about 4% so we're essential three consecutive down quarters for the s&p 500. we haven't seen that since 2020 and before that, it's been a long time since you've seen three consecutive downward quarters we may not be in a recession but in an earnings recession for sure. still ahead an interview you don't want to miss, richmond fed president thomas barkin joins us with his read on the economy can we pull off a soft landing that's right after the break stay with us

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some say it's what they were born to do... it's what they live to do... trinet serves small and medium sized businesses... so they can do more of what matters. benefits. payroll. compliance. trinet. people matter. welcome back to "squawk on the street." i'm bertha coombs. here's your cnbc news update at this hour.

manhattan district attorney alvin bragg filing a lawsuit against republican house judiciary committee chairman jim jordan asking a court to block elements of the congressional inquiry into his case against former president trump the manhattan da argues the congressional committee subpoena would cause, quote, irreparable harm if the privileged material is disclosed overseas, president biden sitting down with the british prime minister, to mark the 30th anniversary of the peace deal. he'll then travel south to the irish republic for two and a half days of meetings with officials and distant relatives. and a hopeful, republican tim scott is expected to launch an exploratory committee for 2024 the south carolina senator will

likely make the announcement this afternoon in iowa, joining a growing list of gop candidates that time of year, guys. >> bertha coombs thank you. inflation easing in march, less expensive gas, lower food prices the bond market pricing in a 60% chance that the federal reserve raises rates in may versus a 73% chance before the cpi release. joining us now is richmond federal reserve president, tom barkin welcome back, president barkin nice to see you. >> thanks. greetings from roanoke we're doing our conference here, hearing about the challenges and issues faced by our small towns. >> love to get into that in a bit president barkin but first your reaction to the inflation data today how did you read it? >> it was pretty much as expected i put focus on the core, which is still running a little over 5% year over year.

and, you know, we had some good news on energy but there's still more to do to getting core inflation back down to where we'd like it to be. >> in other words, more to do you're talking about a may rate hike you're in favor of it? >> well, inflation is going to come down in part because demand is cooling i definitely see demand cooling. and then you've got credit conditions i'm watching that carefully, and of course the lagged impact of rate hike. those are the things i'm watching as we get into the may meeting and beyond >> in other words, inflation is not down enough for you to feel confident that it's headed back to target? >> a good thing to look at is the media. and we've had good months and bad months on the headline but the median has been over target every month since it got started. so i am trying to find some comfort that we can get inflation being felt by people in the economy on average in the

median down to where we like it to be. >> isn't it trending in that direction? there is progress even on shelter which is a big culprit of the higher services inflation, which i know you're watching and the core inflation levels everything is moving in the right direction at this point, isn't it >> i think we're past peak on inflation. but we have a ways to go shelter you mentioned it came in at . 6, multiply that by 12 it's over 12. core services .4, multiplied by 12 is about 5. so i think we're still a ways from there. >> are you thinking more than one rate hike? the market is thinking may and done is it your view you have to do more than that >> i mean, my point of view is that you react to inflation as it comes in. i don't have a few that you find some particular number that's the perfect number and you hold

there or you work from there i think if inflation comes in hot you have to do something about it if demand starts to cool, you can take that on board as well so i'm looking very hard at what's happened in the demand, the labor market and, of course, looking at what's happening with inflation. >> let's take up the demand question because demand is starting to cool we've had a pile of evidence in the last few weeks of that fact. haven't we >> yeah. i mean, you saw consumer spending in february, we'll get another read before the meeting. but i also watch just the day-to-day credit card spending. and i will say, january quite an elevated month february it starred to cool a lot. and what i've started to see in march is flat to even slightly down on the credit card spend year over year so that gives me some comfort that we are seeing demand starting to cool, not fall off the table, i wouldn't call it cold, just call it cooling >> do you think we can pull off

a soft landing you can pull off a soft landing? >> well, i'm focused on getting inflation under control and i think we can get inflation under control. that's really the metric i want to use here. you obviously want to do that with as little damage as possible we'll see what happens on the demand side, on the price side >> a lot of people you know the bank of canada just came out 30 minutes ago and paused for the second month in a row. and they're not at target inflation but they think they can get there. they're confident the trend is indicating they're moving in a disinflationary way and they want to do as little damage to the economy as possible. why are you not thinking that way? >> well, i haven't seen what the bank of canada did but like i said, i'm very much thinking about moving it in the right direction. if you want to get inflation to 2% you ought to have a month it runs at 2% you ought to have multiple months where you're headed towards there. declaring victory too early

doesn't sound like the right answer to me i think you're paying attention to where you're going and, of course, the trend line matters but to get to where you want to go, you have to have months where you get to where you want to go. >> you mentioned credit tightening is one of those things you're watching as it relates to the economy i know you're in roanoke speaking with businesses what are you hearing and seeing as far as what's happening with bank lending >> as i talk to the banks in my district, i'm encouraged by the resilience i'm seeing. they're making sure they have necessary liquidity, deposit flows seem to have stabilized. the banks in my district that i talked to, i feel encouraged by that i am trying to ask the question of what's happening to consumer sentiment, business sentiment and bank behavior. and it's not clear that we're seeing much at this point that is changed obviously, everybody, the day after these events happened checked into their balance sheet. but i don't -- i'm not hearing

businesses talk about chacnging course, not seeing an additional drop in consumer spending. with the possible exception of commercial real estate i'm not hearing the banks say -- or hearing borrowers say that the banks are pulling back. >> in other words, you're not really seeing a -- a problem when it comes to accessing credit in the broader economy at this point >> not yet but you have to be -- not yet but you have to be humble about these things you learn more stuff with time so you know, i haven't, you know, asked three questions and then quit. i'm continuing to be out in the markets in my district talking to businesses and banks and understanding what's happening. >> you mentioned commercial real estate, market's been worried about it what are your concerns there and what are you hearing >> well, the place you hear the most concerns is in office and that's particularly true in

cities like d.c. and my district where you hear from developers and folks in construction about concerns about the office environment. there's huge other parts of commercial real estate, industrial, hospitals, university, institutional, that seems still to be quiet strong and in the construction world they have significant backlogs still. to me this is very much focused on office and maybe more specifically downtown office >> you know, as it relates to the bank problems i know you said you're confident that deposit outflows have calmed down warren buffett said on cnbc this morning depositors don't need to be nervous but he does expect there could be more bank failures is that something you expect as well >> i'm just talking to the banks in my district and what i've seen, i've been encouraged by, frankly i think there's a lot of resilience here, a lot of capital in the cisystem

again what i've seen has been encouraging. >> does it change the way you think about supervision of the banks as bank regulator in your district >> well, vice chair barr is doing review, we'll get the results of that in a couple weeks, i guess but whenever something like this happens you have to stop and ask yourself the question are there things we can do better. i'm concerned about the uninsured flow of deposits that move quickly and what, if anything, hwe could or should d differently. >> if i had to bottom line it president barkin for your views as relates to monetary policy, its a changing by the day, the market's expectations, it sounds like you think good progress on inflation but not enough and waiting to see demand really crack to change your mind about the fed's current path

am i summarizing it right? how would you say it >> i'd put it exactly opposite i'd say demand is cooling, and i'm seeing that cool and i'm waiting for inflation to crack. >> you're not seeing evidence of that yet >> not yet it's moving down, it's moving in the right direction, as you said earlier, but in the absence of a month or two months or three months with inflation at our target it's hard to make the case we're compelingly headed there. >> demand cooling it's not enough to put you on pause >> i'm not going to front run the policy process we'll get a lot more information -- >> that's what we're trying to do here. >> -- on the bank side, credit side i know you're trying to do it. we're going to get a pce, consumer spending inflation, friday before the meeting, an eci before the meeting i'm interested in what we'll learn on the demand side, the credit tightening side and importantly are we starting to see more progress on the inflation side

>> there you go. thank you very much. good to hear it in your own words. tom barkin, appreciate the time today from roanoke >> thank you >> a check on the markets as we go to break. we have lost ground as yields bounced a little bit from the early morning lows two year back to 4 market absorbing the market comments as well s&p 4116 we're not done here on "squawk on the street. we have another exclusive. you don't wanto ss tmi when billionaire marc lasry joins us in a moment. what causes a curve down there? who can treat this? stop typing, and start talking. it could be a medical condition called peyronie's disease, or pd. you're not alone, there is hope. find a specialized urologist who can diagnose and treat pd.

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(cecily) on the network worth bragging about. (vo) verizon just chatting here about the dow losing some steam, about 100 points or so from the session highs. s&p maybe 10 points or so. some may be related to barkin's comments again feeding that theory that inflation may be moving direct

directionally correct but not enough. >> not enough. that was my headline from him. seeing signs demand is cracking, corrected me on that when he sees demand, he sees demand cooling but he hasn't seen inflation crack enough characterized today's report as expected didn't say it was cooler, would like the progress. he didn't play up the progress he played up the fact it was a lot higher than we want it to be and there's more work to do. >> did not, though, seem to be concerned that much about credits. >> agree. >> did mention commercial real estate which we're all somewhat focused on, but beyond that sarah seemed more confident there's not going to be a lending crisis, so to speak. >> yeah. he took that question in two parts one the banks he's talking to in his district of virginia, washington, and maryland saying had he's confident those banks are in good shape, things are looking good

and small and medium size businesses doesn't see a real credit crunch or a problem accessing credit yet though he said he's humble and going to wait for the signs. but it jibes with what we heard from the other fed presidents, the new york fed president as well they're attune to the risk and they're watching to see if it's going to become a bigger problem but not seeing a ton of evidence and therefore potential a green light for a rate hike. >> stay caution -- >> did not get that message from barkin. >> investors and business leaders alike, convening in south carolina for the kiawah leadership summit, focus on the banking turmoil, investing in china, and the fed let's get to andrew ross-sorokin on the scene

>> hello i'm fascinated to understand what you think is going on in the economy right now but specifically you spend a lot of time on credit and spent a lot of time on credit crises before. are you out of one or in one >> definitely in one for us it's the best time ever, mainly because the banks are going to slow down on lending. for someone like me i can end up lending. i can lend to a senior at a secured basis and get 12, 15% which is unheard of. so you're just getting massively overpaid for the risk today. >> do you think -- but in terms of the crisis, jamie dimon used the worse crisis several times when you look at the regional banks, the banking sector, where do you think we are in that? >> i think you have issues the problem is, if you have -- imagine you're the ceo of a company that's got money at a regional bank.

you think you have a fiduciary interest to move that money to one of the money center banks to make sure you have no risk right, because all that happens is, if a year later there's a problem, somebody is going to say to you, look that was obvious. why didn't you do it you can't say well, i was trying to keep the regional bank alive or trying to do my bit to help the community. because nobody is going to care about that they care about that today but the legal standpoint people have an issue so i think the fed has to deal with that issue sooner or later. >> you would do it how right now there's an implicit guarantee around deposits but not an explicit one. >> do one of two things. i would have a guarantee, so that at least everybody knows the fed is there or i would say, if you take your money out, you would use sort of like a little bit like the bankruptcy laws and say if you take your money out within a year we can come back and come after you because you ended up

forcing that bank into insolvency so you can have a look back. so, therefore, you don't want to be the first one out because if you are, and you create that issue, you're going to be the person who ends up having your money taken away. >> you were talking about how folks are not coming to the -- o use the phrase, you have become the shadow banking system, to some degree. >> yes, which is horrible. we shouldn't be. it's great for our firm, but i don't think it's great for the country. banks and for people, you should be able to borrow at 5, 6, 7, 8% you shouldn't be coming to us to borrow at 15%. >> on the trading side of your life, though, do you look at any of these regional banks or anything in the financial space and say, that's a deal i'll take that >> i don't think the risk is worth it today, because you're not getting paid enough for that, for me to go out and buy those bonds and try to make sort of, you know, 10, 12%. i would want to get paid a lot, because if you look at what

happened with signature bank, literally, within three days, it evaporated and so, you know, you're not buying those bonds at 90 or 95 if you want to take that risk, i would want to buy those bonds at 50 and none of those regional banks -- >> what about commercial real estate, for example, right now >> i think that's going to be a problem. i think it's -- >> and are people coming to you? >> no, not really. because nobody can afford to pay what we would charge, right? so i think all that's going to happen is, what happened during 2008, banks are going to have to keep extending even though the money is due, if you can't pay off the bank, what's the bank going to do. they're going to come in and foreclose? no they'll just extend it >> is this all premised on j. powell continuing to keep his foot on the neck of the economy. meaning another 25 basis point rise >> look, i think at the end of the day, j. powell is in a box

and the box is, if i don't lower rates, it's going to cause issues with the economy, but if i don't keep raising rates, i'm going to have inflation. it's not complicated the minute the that happens, there's a recession. is that three months from now or a year ago >> you've been upbeat for quite some time about investing in ch china. is your view on any of this changed? >> no, because, i think it's not per se, china, it's asia that for us right now, where would you want to invest, where do you want to invest in a region where it's growing by 4 to 5% a year

and you still can end up investing and getting paid 15% i think the answer to that is "yes." you can invest here in the u.s. and you know that the economy is flat, up one, down one, or you can invest in asia, because china is the growth -- >> you don't see risk in investing in china or you're saying, not china , you're saying everything else? >> we do everything else, mainly because china is the driver. i think there is risk in china itself but not in asia. >> we were talking to warren buffett earlier this morning, and we had asked him about bitcoin. i was looking back, back in 2018 you said you thought that bitcoin would get to 40,000. of course, it already got there and has taken a round trip it's now close to 30,000 >> yep >> where are you now on all of this >> i bought bitcoin -- when i bought it, it was around 7,000 so i wish i could tell you i bought it at 100 or 200 or 500 i bought it at 7,000

i still own it >> you haven't sold any? >> i should have sold when it all went all the way up. my view is, it's a nice investment for me. it's pretty de minimis, it's small. but i like seeing what's happening in that space, so do i think it's going to keep on going up yes. would i make it a big part of my portfolio? no >> and it keeps going up to what >> that i don't know i wish i understand the space as much as i would like i do think there's massive adherence to bitcoin so for me to end up owning it, my basis is kind of low. i'm happy at where i bought it, so i'm fine. >> talking about a company -- i don't know, you call it a company, a team where you had a low basis and now a nice exit on the other side, milwaukee bucks, what's it feel like now to be almost out >> i think it should close this

friday >> this friday >> yeah. i think it's bittersweet i think there's a moment in time when you want to sell something, i think for me, it's been a phenomenal return. when we sit here in five years, we'll look back on it and go, wow, that was a great trade or we should have held on >> what do you think we're here, by the way, a lot of sports leaders here. a lot of, you know, the commissioners, other team owners here what is your sense over the next five years we talk about tv licensing contracts and, you know, some people think it's going to go up, you know, by multiples and other people think that we are clearly at the high. >> look, i think, i think there's still room for it to keep on going up and i think media rights will keep doubling every eight to ten years, right so will that have -- will your teams double in eight to ten years? i think they should. but, i think today, with my capital, i can do a lot better than sort of doubling that money in eight to ten years. >> how much for you, by the way, of buying that team was about

the experience of just owning a team and thinking about it as an investment or trade? >> i think in the beginning, it was totally about an investment. i think within the first year, it became about how much i enjoyed it, how much i loved it, and i've absolutely loved it i think it's been fabulous it's been one of the greatest experiences of my life but i think i've made like seven, eight times on that investment in nine years i don't think the next nine years will be the same >> plamarc lasry, great to see u >> thanks for having me. >> guys, back to you >> thank you, andrew, interesting. at the end of the day, he's still an investor and a trader, even if it was giving him emotional benefits, that ownership of the milwaukee bucks. as we wrap up this hour of "squawk on the street," i wanted to take a look at one of the deals that was a focus of course, m&a has been spotty to say the least we did see emerson step up to 60 bucks. a number that they didn't get

to, but were forced to as a result of fortive, another company that was trying to buy national instruments, and also was willing to bid 60 bucks, lever itself up as well, and that's what perhaps gave national instruments some pause and why they went with emerson's $60/share bid. but about $8.2 billion you can see, of course, emerson shareholders reacting not particularly positively at this point. 165 million in synergies is what they're talking about, but only over a five-year period. there's a look at the stock over time of course, it has come down since we first learned of their hostile bid for that company that does it for this hour of "squawk on the street. we'll be right back after this need relief for tired, achy feet? or the energy to keep working? there's a dr. scholl's for that. dr. scholl's massaging gel insoles have patented gel waves that absorb shock to hard-working muscles and joints, for all-day energy. lily! welcome to our third bark-ery. oh, i can tell business is going through the “woof”.

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here. aspercreme arthritis. full prescription-strength? reduces inflammation? thank the gods. don't thank them too soon. kick pain in the aspercreme. good wednesday morning welcome to another hour of "squawk on the street. i'm carl quintanilla checking checking the agenda today, first reaction from the white house on this morning's inflation print. deputy director of the national economic counsel is with u