ndd. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire are investors right? evercore isi vice chair krish guha is with us. his reaction to our bostic interview. netflix set to report earnings after the bell. can the company's new

initiatives drive the growth we'll ask ben silverman. as for markets, a little softness dow down 320, the s&p down some disappointing reads on earnings out of the likes of j&j, and goldmans. lockheed martin sending industrials to the top of the market we're in earnings mode, no doubt about it that goldman sachs lag on the dow and the financial sector weighing, not as much on the banking crisis stuff, more on goldman specific, the decline in investment banking revenue weaker than expected and trading weaker than expected and selling parts of the consumer loans business. >> yeah. even goldman saying maybe the worst of the crisis is behind us as for topping the tape today, divergence on wall street. goldman says the worst may be in the past b of a says the consumer remains intact here. the s&p near a two-month high. the vix, wow, below 17 this

morning. despite all that, investor sentiment is pretty low. b of a fund manager sentiment, the lowest of all year cnbc survey showing new pessimism. aa survey showing bearish above historical averages. 95% of investors see the market falling or flat. that's according to jpmorgan survey's yesterday let's bring in cnbc markets commentator mike santoli what can you say about the sentiment? >> it's a big explanation for why we're here i would characterize it as rational skepticism about the markets. we see the leading indicators of recession, but the earnings decline has been orderly and well telegraphed valuations are not really compelling, but where they're most of a problem are the big stocks that have been performing well if you say the russell 2000 hasn't done well, that's the

cheaper part of the market are you complaining about valuation or momentum? i see why you're hesitant here the s&p over the last 11 months has spent maybe a dozen days much above the level we're at right now. a big question i have is given all the nervousness out there, given the fact that people seem underinvested and happy to sit in money market funds, is the market going to stop at that exact spot again, 4100 to 4200, which it's done a half dozen times. >> everybody loves to hate this market one of the cases is, look, earnings expectations are too high and recession is not price in and both look likely. the data doesn't show a ton yet, downside momentum for earnings improving lately. ally bee >> without a doubt there was this -- the casino company of a few years ago in vegas used to talk about just the right amount of wrong. that's what they were selling. i think this market has just the right amount of wrong. yes, we don't want to see credit crises, we don't want to see

banks fail but when you have a little bit of that and it sort of takes parts of the economy off the boil, it's disinflationary it's enabled the market to kind of keep this decent nominal gdp pace intact and not yet back off. now, empire state manufacturing yesterday showed this huge rebound. everyone's ism models have to be readjusted for that. you wonder if this idea we've been stewing in recession expectations for a year, and yet it keeps getting deferred, is that going to lull everybody into a false sense of security or is it still just keeping us a little bit anxious and that's maybe a good thing that's the wall of worry. >> we're not in a false sense of security yet. >> i don't think so. >> that's maybe tomorrow's problem. not today. >> we have just the right guest to discuss this. mike santoli, thank you. the federal reserve's next move is a big piece of the puzzle the chance of a 25-basis-point increase for may, now at almost 90%. the big question is, should we expect any rate cuts this year

what happens next? joining us in an exclusive interview is atlanta federal reserve president raphael bostic president bostic, welcome back good to see you. >> it's good to be back. how are you doing today? >> doing well. trying to figure out all these crosscurrents in the economy are you still thinking one and done when it comes to a may interest rate increase >> so, one for sure, that's my baseline for this year i've been at this point for quite some time. the economy is still -- has a lot of momentum, performing quite strongly and inflation remains too high before i came down to the studio here, i took a look at our underlying inflation dashboard by pretty much every measure that you look at, current inflation is more than double what our target is so there's still more work to be done and i'm ready to do it. >> the question now becomes, what happens after may are you leaning toward more hikes, staying put >> so, my baseline is to hold.

i think that after the next move, if the data come in as i expect, we will be able to hold there for quite some time. now, you know, i've been saying for a while, i don't think inflation is going to come down quickly. it's going to take some effort and a resoluteness on our part once we get to that point, i don't have us really doing anything but monitoring the economy for the rest of this year and into 2024 >> what factors would make you consider an interest rate cut? because the market is now expecting that in the back half of this year >> yeah, i know. part of this is really about the pace of inflation returning back to our 2% target you know, i don't think that's going to happen as quickly as some of the markets do and it seems that the question is, who's right on this? i think we've made a lot of movement in the last several months, but now the hard part happens. you know, at the beginning of

this year people were talking about, has inflation plateaued at a level i think those concerns are still, in my mind for sure, and we're just going to have to see the pace that it comes down. i don't see it coming down below maybe 3.5% 3.5% is still well above our 2% target as i said, there's a lot of work to do. we have to stay on top of it this is one instance where i hope i'm wrong, but i don't think i am at this point. >> there's also this question, president bostic, about how much inflation is just here to stick around because of things like near shoring and security risk and esg. president lagarde of the european central bank this week talking about how the u.s./china trade tensions are ultimately inflationary do you agree >> i think it's still an open question you know, folks in my building remind me all the time, there's a difference between a one-time shift in a price level and underlying inflation

and so the near shoring may actually lead to a different bays but that's different than saying we're going to fundamentally see escalation continue at elevated levels moving into the future we just have to see how these economies play out i don't think it's a foregone conclusion that inflation has a new baseline or benchmark in terms of the number that we should be using as our target. >> what about the economy, because that's the other piece of this. where are you right now on recession expectations as soon as this year >> well, i don't have recession as my baseline outlook look, throughout this entire pandemic experience, the last two or three years, the economy has continued to tb extremely resilient and continued to perform better than almost anyone expected. i don't know why -- i don't think we'll see a whole lot different in that regard, which is another reason why i'm really comfortable holding at our restrictive level for quite some time, as that energy of the

economy really starts to be wrung out and we get more into balance. you know, part of the challenge we have right now is that we have an economy that aggregate demand is extremely strong we have to see some weakening, but we just have not seen weakening happen at very large increments and i'm hopeful that will continue as we go through the year so we have an orderly return to balance and back to our 2% target. >> but you know, i don't have to tell you, the long and variable lags of monetary policy. so, you think the economy can withstand, what, 550 basis points of tightening, high inflation, into an inverted yield curve and not go into recession? >> well, i want to correct you on that first thing. while there has been 525 basis points of -- >> i was adding may. >> oh, yes so, that's fine. but all of that has not been in the restrictive space, right so, the first 300 or 350 basis

points of that was basically taking the foot off the gas and moving out of accommodative into restrictive. if you think about what we are going to need to see, we need to see slowdown and slowdown is going to require putting your foot on the brakes, if you will. we've only moved into that territorier to over the last -- you know, starting in the fall so, there is still a lot of work that's going to go through our policy that's one of the reasons why i think one more move should be enough for us to then take a step back and see how our policy is flowing through the economy to understand the extend to which inflation is returning back to our target. >> there's also the bank issues. we've been covering the bank earnings today and last week extensively. we'll get more regionals but from your perspective, is the bank stress over >> well, you know, i'm a bank regulator, so i get paid to work about this i never think of it as over, over what i'll say is the acute

tensions seem to be riesiding -- or subsiding i talked through the last several of weeks to a number of banks throughout my district at the regional and at the community levels what they're telling me is they're not having their customers call them, wondering whether they should move their money. they're not seeing removals of deposits out of them and into larger banks so, the banking system in the six district as a minimum, and i'm hearing other places as well, seems to be stable and has gotten through this. but, you know, you never know when the next shoe might drop. we'll stay diligent to make sure that we're ready and governor barr's report is going to come out may 1st. it will be an important step for us, detailing how we're going to make that happen. >> president bostic, goolsbee's comments last week, which the market paid quite a bit of attention to, arguing the banking stress in march did

demand that we be somewhat cautious i wonder how you read those comments >> so, i actually agree with president goolsbee he's a really smart guy and very careful with his words but we have to acknowledge that there was a lot of uncertainty in banking and that that had the potential to ripple through the economy in unexpected ways what i also do know is that the uncertainty is going to cause bankers themselves to be more cautious and be more circumspect in terms of the loans they extend that's going to do some of the work for us. and allow us to not have to raise interest rates as much as we might otherwise so, i think austin and i are pretty aligned in terms of our expectations and now it's really about monitoring the economy, paying attention and making sure we understand how that evolution is taking place >> we had a conversation here on the set yesterday with the speaker of the house about the debt ceiling and i wondered, does that become a larger function of the fed's

decision-making, at least in the near term? >> you know, the chair has been pretty clear that passing this debt ceiling is really important. i'm just going to watch. i'm hopeful the congress and the administration and the white house, president biden, come to agreement and pass this sooner rather than later because the uncertainty, as you know, uncertainty is not our friend when it comes to longer-term investment the closer we get to the brink, the more uncertainty will rise and that could have really bad effects for the u.s. economy. >> i wonder also what you made of inflation expectations in the last several days. b of a has a nice chart out today looking at the one-year expectations they say while, yes, they have dropped, it's still the most persistent since '88 to '90. does that surprise you >> it doesn't really surprise me people go to the grocery store,

they go to the gas tank. they're seeing the higher prices that's going to shape the expectations about what their experience is going to be in the next month, the next two months. the thing that has been relatively encouraging for me has been that the longer run expectations around inflation have not moved nearly as much. and they're comparable to where they were at the beginning of this episode that's the one i'm really focused on because we start to lose sight of that, that would be important and i would also say i'm really encouraged the longer run inflation have not moved because it suggests people have confidence and the most important message we can deliver is, as members of the federal reserve, which is inflation is our number one problem today we are going to do what it takes to get it back down to our 2% target >> what's the plan on the balance sheet, president bostic? as qt continues to roll on, what size do you want it to get to? obviously it's increased because of some of the special emergency

programs you guys have put in place around svb, but what's your thinking around that? >> well, you know, i have to say on the reduction of the balance sheet, i'm really pleased with how it's proceeded you know, we increased our purchases of assets because we had an emergency and we needed to make sure there was liquidity in all parts of the marketplace. as we've moved beyond that, it's important that we get our balance sheet back down to size that is appropriate to how the economy is i think the markets are telling us there's still a fair amount of excess liquidity, somewhere between $1.5 to $2 trillion. i think we should continue to remove that liquidity -- remove our contributing to that liquidity and then see how the markets evolve so, my view on this is just keep the program going as it is and i'm confident that at the end of the day, the balance sheet will be able to return to a more

normalized size without creating significant disruptions in money markets. >> you know, a lot of people have questions about how the fed measures or prioritizes high frequency data for example, this redfin data last week where it showed median rent went negative year-on-year for the first time since 2020. is the committee paying more attention to that kind of data, just even with the acknowledgment that it's not a government set of data >> so, data is data. for me, i'm not so sensitive about the sources of it. i'm more interested and concerned about its reliability and the likelihood it will tell us the same type of information over a period of time. here in atlanta, we have for many, many years sought alternative sources of data to inform our understanding about how the economy's evolving ly tell you during the pandemic, those sources of data wound up being much more important because the economy was evolving so quickly

so, i think it's really a prudent thing to take and review data that's happening that is available wherever it's available and we'll continue to do that. the redfin numbers are actually quite interesting. we're hearing similar things around the sixth district in the southeast united states. i'm hopeful that that bears out in the national numbers because that will suggest that inflation is going to continue to move closer to our targets. >> i guess what i'm just wondering, president bostic, is the fed and you expect another rate increase. doesn't it directly create stress in the banking system because it encouraging this deposit flight into places like money market funds isn't that part of the problem don't you worry that if you continue doing this, the bank stress will get worse? >> so, there are a couple thoughts here. one is that whoa need to get inflation under control. that's the first thing

the second is we've been pretty clear in communicating our approach to doing that so, that should give everyone a road map about what we think is going to happen, which should, in turn, lead institutions to make strategies and adjust their policies with that in mind we've tried to be as transparent as possible. the chair operates and speaks with very plain language i really like that so, there should be no surprise for what we're doing for months before they actually happen. so if you think about what's happened in some of the issues and areas where we've had bank problems, the bank strategies did not change to the reality of what we knew what was going to happen when i speak to bankers, they know what's going to happen. they can adjust their deposit structure and make sure the flight you referred to does not happen as acutely. i'm expecting we'll see a lot more of that in the months to come. >> higher deposit rates with consumers. >> yes. >> we've seen it in earnings already.

raphael bostic, thank you for taking the time today. really appreciate it. >> it's been great to talk with you. i look forward to next time. >> you, too. the atlanta fed president, doesn't see recession and they're clearly very focused on inflation, which is too high so, they're going to go in may he would like to see a pause after that doesn't sound particularly worried about some of the things our other guests are worried about, credit crunch, bank stress they're monitoring it, but so far not seeing anything -- cause for concern. >> bank tensions seem to be subsiding, aggregate demand is strong, economy outperformed expectations, so - >> and he's someone that has worried before about the economy, so if he's even hawkish, everyone is a little hawkish. >> the blackout window is about to begin pretty soon. >> quiet period next week. >> yes. >> a lot of ground covered with bostic a moment ago. when it comes to his outlook for the economy, as we said, it remains vigilant the economy is resilient, recession not as baseline

let's bring in evercore isi krish gais guha. >> good to see you enjoyed the conversation with raphael. what we're learning here, first of all, although you could make a pretty good case, i think, for taking a time-out in may, pencilling in a hike in june that's not where the committee is at. there's a broad growing consensus on the committee, let's do that 25 in may. the debate, i think, is really going to be about the signal they send as to what happens next, how pausy the language is versus how much of a bias to being ready to do more they convey in the statement and the press. you had chris walic on friday sounding very hawkish, suggesting for him it's at least

one more hike. he sort of implied he might see jean as a 50-50. i think raphael bostic is much closer to the middle of the committee in saying, okay, the real-time indicators around the banks are looking a bit better i'm going to be comfortable doing that next 25 in may, but then i'd like to take a time-out, look around, see what's happening and i think that's essentially where the committee is going to end up i would view may as one and probably done. although they'll try to make us believe that, you know, they're certainly not done for sure. >> i think the big wild card, krishna, is nobody knows how fast inflation comes down from here he's worried -- they're all worried it's sticky because they're so traumatized they were wrong on the transitory call when, you know, you talk to folks in the market and some of them say, look, inflation expectations have come down.

they need to be more worried about the economy and what's happening in the banks than inflation, and they're just not. >> you're right. they're still very fixated on inflation. secondly, they're taking a lot of comfort from the high frequency readings around the banks. the use of the emergency -- the peak, the fact we saw deposits bounce back a little bit last week we didn't see any more bank failures i think that's all positive. but i think it would be a big mistake to conclude and, therefore, this whole thing is over president bostic spoke about the end of the acute phase of the banks. i think that's right i think we're into the chronic phase now. we may only be in the second and third innings of this in terms of banks turning very cautious, tightening lending standards, and that gradually putting the squeeze on sme and commercial

real estate lending. you wouldn't expect to see that eight, ten, 12 weeks after the event. we shouldn't take too much comfort from the better real-time reads today. i do i think we're still looking at a sizeable credit squeeze i would note that back at the march meeting seemed to have a much darker take on things on the credit squeeze than the fed. you're right, the big debate yet is about how sticky this inflation is my hunch is it will still be sticky for another quarter or two. late this year, early next, i personally see disinflation moving faster than the fed anticipates. still with core pce down to three or the very low threes by the end of this year if my optistic view and the

market's optistic view is right and you see the inflation finally unfold, i still think we can get, will get one, two cuts in the very final part of this year. >> we talked to ed hyman a few days ago was probably more focused than the committee on the negative effects of yet one more hike. not to put words in his mouth, but there is this assembling view that even one more hike is like trying to pick up a dime in front of a steam roller, is it really worth it. >> look, if i was on the committee, i would be in the austan goolsbee camp, saying, let's take a time-out in may and pencil in another in june because the core inflation is still up the wage data is giving us conflicting signals. atlanta fed looking quite hot

still. pci coming soon, the best estimate of wages. you have to reserve the option to do more you have to because inflation has been too high, too long. your credibility matters, keeping expectations are key to bringing back inflation. i do suspect in hindsight we'll look back and say the last move or two was overkill, particularly in the context of the credit squeeze that i do think is coming, despite the better reads that we've been seeing in some of the -- >> in other words, a mistake, a classic mistake. krishna, carl asked president bostic about the debt ceiling. it's getting some attention now on wall street goldman sachs out with a note today saying they think it's going to be earlier than later probably early june because he's looking at early tax receipts. we'll have to see how tax day goes and hear from the treasury on an update on that we spoke on this show yesterday, had a fiery interview with the house speaker kevin mccarthy here's what he said about why he wants to pull this bill forward

to raise the debt ceiling now. >> why do we have to wait until a deadline to act? you're sitting talking to the speaker of the house, who's telling you he's going to act. has the senator done anything? if the add vocation on the other side is to pass a clean debt ceiling, has the senate passed that yet would it pass? has the president proposed it? what have they done? what have they done to find savings? >> krishna, this gives you a taste of what is to come here when it comes to the politics and the posturing and the acrimony president biden said he's not negotiating and here's the house speaker at the new york stock exchange saying, all of these demands and that they're not going to let the kid raise the credit card limit. what's going to happen and how does this collide with the economic views and the fed forecast >> yeah. so, we have long believed the debt ceiling is a serious risk

and as we got closer to the event, stocks weigh on markets more serious 100% on board with that. also tracking similarly. tax receipts, the x date is closer than -- rather than further away look, i read what you heard in that interview as just, you know, the early and still very aggressive phase of the negotiation process here between the different parties. i think in the end, to a degree, everybody in the political, you know, arena here understands they have a role to play in this i don't think anyone actually intends to drive the bus over the cliff and have the u.s., you know, experience a technical default. by the way, would be the dumbest thing in the world in terms of long-term costs to the u.s., in terms of u.s. credibility, particularly in geoeconomic

competition with china but i think there's going to be a lot of posturing and tough negotiations i think the proposal speaker mccarthy is waiting for the white house to sign off on it. it's just a negotiated position at this juncture i think the tricky thing here is that while there's drama to play out the way it's supposed to play, the politicians need the markets to throw a tantrum at some point so they all have an excuse to climb down and compromise so, if we're sitting here couplely saying, the guys are going to sort it out, they're not. they're going to need a kick from the market before this thing gets sorted out. the longer the market waits on that, the closer we get to the point where this could accidentally go over the cliff into that kind of technical default that i would not believe any politician would actually want >> krishna, appreciate it. as we rely heavily on these last remaining bits of fed commentary

before the decision, krishna guha at evercore, thank you. we are getting some headlines from boeing's annual meeting right now. let's get the headlines from phil lebeau. >> shares of boeing moving higher after ceo dave calhoun said during the annual meeting that the company is not changing its 737 max master supplier schedule what does that mean in laymen's terms? people thought once the company said, hey, we're going to be pausing delivery of some 737 maxs, it might mean also a slowdown in production but calhoun is saying they're still assessing the full impact of what the slowdown in deliveries might mean. for now, they're not telling suppliers to slow down or change their plans when it comes to production either now or in the future in terms of the delivery guidance, they're still assessing whether or not that will have to change in the future remember, their guidance for this year is 400 to 450 737 maxs to be delivered. and we also have them saying

during the annual meeting, dave calhoun saying that at this point they're assessing what impact, if any, there may be on the company's financials guidance remember, boeing reports its q1 results next week. so, we may get an update on this at that time one last thing, they are reaffirming their long-term earnings guidance and the expectation of $10 billion in free cash flow for 2025-2026 all of those headlines, good news if you are long on shares of boeing, which is why the stock is moving higher guys, back to you. >> just like that, to the top of the dow. thank you very much. later, is warner bros./discovery a takeout target we'll have that call plus a look ahead to netflix reporting tonight coming up. plus, we're watching shares of dow component j&j sales up 5.6% in the quarter, beating estimates. the company raising its full-year guidance the stock is lower, though, down 2.5% we're back after a quick break

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welcome back to "squawk on the street." i'm bertha coombs with your cnbc news update at this hour flights have resumed following a federal aviation administration issuing a groundstop for all southwest airlines flights nationwide the stop was lifted after about 15 minutes the airline says data connection issues resulted from a firewall failure that was to blame for the ground stop. meantime, the fda authorized a second dose of the updated covid booster for older americans and people with weakened immune systems today. those over 65 can get a second dose of the updated booster at least four months after their last while immunocompromised people only have to wait two months after their previous dose. president biden signing an executive order to increase access to child care and advance

affordable care giving the order contained more than 50 directives to take steps towards fixing the nation's care systems. biden has pressed for more affordable child care solutions since he took office in 2021. rhtac see wl thetrt"il beig bk in two minutes to verizon business internet. (woman) it's a perfect fit for my small business. (vo) verizon has business internet solutions nationwide. (man) for our not-so-small business too. (vo) get internet that keeps your business ready for anything. from verizon.

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revenue. despite some spring breaks across the country there could be an opportunity, though, outside of hotels. b of a calling expedia's vrbo undervalued, estimating a value of $16 billion relative to airbnb versus a roughly $14 billion valuation for expedia as a whole, which is still dwarfed by airbnb and booking holdings let's bring in seema mody to talk about some of these names which have rocketed to the top of the s&p winner's list. >> this is a hot take by bank of america. yes, hotel rates have sort of slowed down. the average cost to check into a hotel is $153. in mid-march we were at $166 yeah, some softening in trends, but not a huge pullback. marriott ceo, who i know you spoke to recently sara as well, he is expecting rates to moderate in the second half of this year. so, i think the big question is, do we continue to see a continuation of this trend and maybe there's going to be a bit more concern about hotel demand. yeah, the hottest markets like

maui, florida keys and miami are $450 to $600 a night that's where the big hotel developers are expanding as long as those markets stay strong, i don't think there is as much concern about a hotel slowdown as to this note on expedia and what we're seeing with vacation rentals, there's industrial data from air dna which raises concerns about airbnb which deutsche bank wrote about last week you mentioned it as well, carl they're now expecting airbnb to see a potential miss on q1 because of concern there's an oversupply of vacation rentals everyone got that second house during the pandemic. can that strength hold up for the summer >> i would imagine the travel boom is lasting longer than the executives thought everyone expected the pent-up demand did they expect it to last this long >> that is the big surprise. the question going forward, yes, the commentary from executives i've spoken to and even when you look at the conference calls is, yes, the summer of 2023 will be

strong in fact, it's expected to be the summer of international travel we start to see more americans go overseas. of course, it conflicts with this narrative of a recession and whether that will play a role and how much consumers want to allocate towards vacation there are some trends that some people, americans specifically, are spending a little less on their vacations, but they're still taking that vacation >> so expensive. i would have to imagine. i mean, they're rethinking it, right? it's gotten crazy. >> right this is a sliver of the economy that's held up relatively well compared to housing, retail, other subsectors we've seen housing come down. the post-pandemic prioritization of travel, this idea of we can't miss out again, finding ways to trim costs. rental car prices have come down significantly. there are some areas of the travel economy that you could say are showing some softening. >> we've been looking for cracks, but you had delta's earnings which were great.

>> and now we look to united airlines have been driving the pricing power, vacations, hotel. >> and they're loving those 2019 comps. everything is up versus them, for a while. thank you, seema mody. still to come, netflix hoping a new ad tier and a crackdown on password sharing will drive revenue growth. the stock is flat over the past year we'll break down what to expect from the company's earnings report with ben silverman next h? dad: maybe. i'll put a request in monday. sfx: shattering glass. theme song: unnecessary action hero! dad: was that necessary? unnecessary action hero: no. neither is missing this deal. with paycom, vacation is yours to manage. unnecessary action hero: not to mention benefits, scheduling, payroll. it's hr in the palm of your hand. dad: wow. unnecessary action hero: ask your employer about paycom. and make the unnecessary, unnecessary. dad: approved!

a lot of headlines to break down in the streaming space today. netflix reporting tonight. screenwriters reportedly voting to authorize a strike against studios in hollywood and this bull call this morning on our parent comcast atlantic upgrading to overweight, calling out some potential m&a upside joining us to break it down, ben silverman. it's great to have you back. welcome. >> thanks, carl. on netflix, right, i mean, up until now we've talked about what kind of slate the quarter had and what they're going to say about subs, but then the "love is blind" thing happened and there's been this budding discussion about whether or not the tech is there to event bely do more aspirational things like live sports. >> well, live is always been a holy grail of this next iteration of streaming it requires a lot of technology. it requires a lot of investment. and it's hard to do. you know, youtube has had a lead in the ability to do that when

they did their big jump out of the balloon with red bull years ago. and no one really has nailed it. but as i watch amazon and apple dive into sports, i was surprised that netflix had that issue because i felt like they would have been very prepared for it. >> right is there -- do you see a moment where folks start recomputing the cord-cutting process and thinking, wait a minute, if i really want to see my most treasured content, maybe i can't afford to cut? >> well, i do think on the other hand there is such robust content coming from netflix. and it really is delivering amazing, you know, touchpoints across so many genres of television and content that is hard to find elsewhere and that you're getting more and more excited to see. no one else has amassed as much international content, no one else has amassed as much original content as they have in such a short amount of time. so, i am still incredibly long on it. i think that is more of a blip

they'll figure out and fix and i do think all of the different ways they're allowing you to now subscribe, whether it's ad-supported, whether it's a basic tier, wlits a premium tier, are not going to feel expensive compared to anything else in your life. 7 bucks a month for a trillion hours of content seems pretty darn cheap to me >> well, i was asked about the ad tier, ben if you -- if you think wall street is right to be so bullish on the ad-supported tier and the crackdown on password sharing? >> well, i am incredibly pleased, actually, they're welcoming the advertisers back into the ecosystem all of television was driven by the idea of selling soap and cigars, whether it was william pelley or the birth of the soap opera. it has always been driven, actually, to drive in advertising medium so, it was surprising me how much the streamers were resisting advertisers in their

ecosystem initially. i understood it from the premium perspective but now they've come up with a way to tier the selling and i think advertisers want to be where culture is and it emanates from tv, streaming, content. where culture and content come together is where commerce is created. i see this happening all the time i'm always talking about the three cs in that context, and i think the advertisers are really going to want to be inside these walled environments. they'll be happy to be inside them and i think they're going to be able to innovate with these new players. >> speaking of content, the labor strife we're watching has big ramifications for what kind of slates will be put together in the coming quarters if they need to start relying more on news or reality. how much is the town talking about that >> i always feel like we're rubric in dirty rotten skoun drels trying to stick a fork in my eye, where the people who punch each other out on the biggest super bowl event, we're the people who seem to relentlessly make those choices.

unfortunately, i think the strike, which it seems more and more likely, especially with our brilliant writers now, 98% of them in the core group voting to approve a strike if it actually happens will be very disruptive and will hurt the industry for the near term. but the last go-round it took place and it really accelerated a lot of changes in the industry that needed and then it opened up and business returned i worry now it could cause even more pain than it did then. >> also what's different right now, ben, is all of these companies are under pressure from the market and from their shareholders to save on costs and to cut back on the aggressive spending we had seen in years past. >> well, labor prices keep going up and inflation keeps coming into other parts of the industry we still are paying huge premiums for covid protections, which seem out of whack with the rest of the country. and within our production

budgets we have all of this incremental money going out the door for daily testing and other things that are really not necessary now in a vaccinated landscape. so, you look at the industry at a whole and there are cost pressures on one end and then there are revenue pressures on the other. where will the two meet? i'm incredibly bullish on the long run because so much of this is unlocking opportunities that we as independent players see as so obvious, opportunities to build brands with our distribution partners and actually create product lines and businesses, like i read about the lacoss netflix collab or the shopable that comcast is bringing to peacock. these platforms really will be the ones that drive that and if you're in an ecosystem like amazon has created where you can also click and buy through these services, that's going to unlock a whole new set of revenue i'm incredibly bullish in the long run

i think these are all challenges that everyone is facing in the near term and that they will be overcome and the only other thing i want to add about the strike is, when the writers go on strike, so too do the actors and directors. it's not just going to be them striking it will be a soft strike because the other unions will strike bee the other unions will respect the writers and won't cross the picket lines the content that's been written is unlikely to be produced i think that will be a real slowdown in original content for all these players. >> that's a great point. we'll talk about m&a optionality another time that's a conversation that's not going anywhere i'm sure, ben thanks for the time. good to see you. >> great to see you both thank you. >> the last time they went on strike, 2007 it lasted 100 days and cost the l.a. economy an estimated $2.1 billion. i did not realize it was that long >> company down for sure. >> at least they fill nished filming the third season of

"bridgerton. >> is there time to buy a stock that's surged 90%? that story is next plus, don't miss pnc ceo on "squawk on the street, an earnings exclusive on the at his bank and the entire system to verizon business internet. (woman) it's a perfect fit for my small business. (vo) verizon has business internet solutions nationwide. (man) for our not-so-small business too. (vo) get internet that keeps your business ready for anything. from verizon.

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microsoft's efforts to develop its own chips, today's "tech check" segment with deirdre bosa is this a catch-up call or a sign we're in the early innings of this nvidia rally >> it could be beau. i'm going to get to why they may be at odds you mentioned that rare double upgrade. that's obviously bullish it was the last sell rating on the street to crack and did so pretty spectacularly analysts went from lowest to highest price target on the street as he shifted his focus to nvidia's ai dominance something that shocked him but many other investors did see a while ago, this is a stock that has surged 90% this year the biggest duaner in the s&p 3 500 and on its prime position in the ai revolution as we talked about so often many of the bears, on the other hand, focus on valuation, nvidia's multiples have run up alongside that surge the second story you mentioned,

microsoft's push to develop its own ai chips, which the information reported on earlier today, that could give the bears another reason to be cautious. nvidia currently dominates the market for high-end chips for large language models and specialized computeers that can handle the processing needed for ai software. some of the biggest consumers, microsoft, google, meta, they're racing to develop their own silicon to achieve better performance at a better cost than third-party vendors, namely nvidia ai chips are code named athena according to the information google's is the tpu and amazon has tranium. some analysts and experts are skeptical this will present a major threat to nvidia the hsbc didn't even mention, guys >> talk about a bull market,

there must be some crazy poaching going on. that's what some of the reports have led us to believe our deirdre bosa watching ai up next, wall street is buzzing about commercial real estate again a major office owner defaulting on a more than $160 loan you got this. let's go. gobble gobble. i've seen bigger legs on a turkey! rude. who are you? i'm an investor in a fund that helps advance innovative sports tech like this smart fitness mirror. i'm also mr. leg day...1989! anyone can become an agent of innovation with invesco qqq, a fund that gives you access to nasdaq-100 innovations. i go through a lot of pants. before investing carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com. ♪♪ the only thing i regret about my life is that i did what everyone else did at the time.

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we've got what i would call a minor sell-off in the markets. the dow is down 100. goldman sachs is off the lows of the session, but it is down 2% and it's been a strange reaction because it's spiked premarket on the back of results which were fine goldman is a capital markets bank it's not a net interest income bank in other words it's not -- it's more reflective of the environment right now. we don't see as much m&a happening. that's why fees were down 26%. they had a pretty decent quarter when it came to trading. we're trying to figure out the message from the banks, and as far as goldman is concerned, not really anything when it comes to lending or the overall environment even though david solomon spoke cautiously on the economy.

>> that's true they said they were cautiously optimistic on equity underwriting but vix down 17 was light and mostly about this provision benefit regarding the market's repositioning was it an ugly beat, so to speak. cramer didn't seem to think so t. has been a drag on the dow for most of the morning. we're still holding in on 4149 back to post 9 and the judge carl, thank you very much. welcome to "the halftime report." i'm scott wapner live from post 9 here at the new york stock exchange front and center this hour the vaporized vix and what the collapse of volatility says about the state of stocks. our investment committee debating the road ahead with earnings season now firmly under way. joining me for the hour everybody in the house here at the nys he, josh brown, stephanie link, jason snipe, jim lebenthal. let's check the markets. sara said we have a little bit of a sell-off. not much, though we are in the red, however, across the board do you have goldman, j&j, unitel