happening with the ten-year across the board here. looks like the ten-year is at 3.743% the two-year is all the way up at 4.554%. i don't know if you saw on the short-term bills we were looking at, the one-month is basically yielding the same as the one-year, which is interesting just keep rolling it and have that money available whenever you wanted it. that does it for us today. join us tomorrow right now, it's time for "squawk on the street. ♪ good monday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer, david faber at post nine of the new york stock exchange coming off the best week for stocks since march as we now head into a fed blackout, and today, an event at which apple is said by some to unveil its most important new product in 13 years. our road map begins with market momentum, though s&p, best week since march, highest level since august, but some strategists now warning of risks to the rally ahead plus, apple is expected to get in -- in july.

let's begin with the markets, though, after friday's rally. jim, we were looking for some of those who were fundamentally bearish to turn tail not happening at morgan stanley. >> not at all. but i looked at friday, and i said, just broadening out of the rally, which everyone thinks is good, i'm not quite sure you really need sideline money to come in sideline money is sticking to its decision not to come in. so, why -- david, why would we suddenly have, based on a somewhat stronger number, a belief that they'll be -- i think there will be a skip -- that it's time why is it time to start buying the cyclicals? >> i can't necessarily give you a reason >> because then what >> we don't seem close to a recession, so that, i assume, is kind of good >> i agree >> that said, your point about

stickiness, you know, things are stickier when you get 5% as opposed to 0%. it just makes it a -- a tougher decision like, well, i'm getting 5% over here, the risk-free rate, i got the debt ceiling issue out of my way now. and no signs that rates are going to come down any time soon >> i cannot disagree i'm -- obviously, i have a 401(k), and every month, i put money in, because that's the way i've done it since 1982, if it's $500 or $50. i'm not doing it this month, because i keep thinking, what am i doing? 5% i mean, i've been dreaming of getting 5% for my cash for ages, so i can't say, after this big run, including friday, now's my chance to get in no i'm not going there. >> interesting, because now that we do have the debt ceiling under our belt, we're looking for a trillion, maybe, in fresh issuance before the end of the

quarter. b of a says today that's probably worth another hike. >> i was bombarded by people who said to me, are you aware of how much money has to be sopped up i come back, and i was -- what brian moynihan said this weekend, and there's a pullback. there's a pullback among people, you know, look, we have had some consumer spending that's been elevated i've got this from them today. they have 68 million -- now we know they were on tv, but 68 million consumer customers with an average of 40% more in savings than they had pre-covid, but the amount's come down, and i think that what's happened is that we're still going places and doing things, but we're in a different kind of moment i think we're in a moment where whatever money that you might have in your savings account really also loves the 5% >> yeah, it does i mean, as for this concern about this massive issuance from treasury, we've been talking about it now for a couple of weeks. >> yes >> i can remember we were discussing it when we were out in santa barbara, which is

already a couple weeks back now. you know, the market usually adjusts for these things, and it tends to be when we talk about something for weeks, it tends not to actually end up being the concern we thought it was. i don't know that's just kind of what i have found through the years. >> i think that's right. i mean, obviously, like many people, i look through, and i say, what's really happening that dollar general is terrible. i mean, really kind of surprising nordstrom is a little bit better, but that was rack. macy's was okay. business decelerated during the quarter. >> but he didn't give a great commentary >> not at all. what do we get today walmart's good >> what is that in, a research note >> yeah. by the way, target -- people are really bashing on target, saying that the student loan change -- >> today it's key. the key, yeah. >> i thought that was interesting. so, if wells says walmart is the goliath and it's getting stronger, credit suisse agrees

a positive note today, also, about costco what are those two doing rolling back the price of food and that seems to be indicative of where people are going. if you read the dollar general, the dollar general, by the way, the conference call, was literally incoherent i think when they finished, they said, wow, what did we say because whatever we said was really bad >> well, we've talked about these cross -- these different signals that we're getting from retail, so is there a conclusion at this point? >> i think the conclusion is just that we're going back to normal spend in 2019 with the exception of travel. and travel remains very strong, because that was a leg zoacy of what happened in pandemic, but you keep finding more and more people saying, listen, it's extra friday, makes it so we go lulu, which was the strongest of any of the -- >> extra friday being, people not working as often on fridays? they have more time to spend

money? >> well, they have a different look on fridays. >> oh. different look on fridays. >> i know all this stuff seems f fatuous, but if you go over what jeff smith said on the macy's sk call, every month was weaker nordstrom, every month was stronger there's a pox on everything, except for dollar gen, which was gad, and walmart, which without saying anything, really had a very good quarter, and costco was saying something, made it so you realized that they roll back prices, and that's what people want they want rollbacks. >> big piece in the "journal" today about deflation in eggs. watching for grocery disinflation it's happening huge -- i don't know if you saw the euro zone producers went dramatically. >> we have dramatic decline in food prices if you go to the right place.

david, i always do these things, and i don't mean to, but when you go to dollar gen, they have these smaller form factor things >> i'm aware, only because you've told me >> it's not as much of a bargain as you think that's what i'm saying but walmart, if you go to walmart, which i try to encourage my wife to go to this weekend, she would not you have radical low prices. >> well, actually, you have everyday low prices. >> he's so right >> smiley face >> but you have their store brand, and they've rolled that thing back very big. their store brand happens to be quite good i'm not a snob on store brands >> isn't that great at a time where we're adding a few hundred thousand jobs a month? >> i think walmart goes right to $170 i think it's very strong i think costco breaks out here after really kind of a muddled situation where rich galanti was calling everybody, saying, you got to roll back prices. some analyst is saying, how can you get away with that he said something like, we do

have $240 billion that we buy. and you say to yourself, well, the rich are getting -- the strong are getting stronger, costco and walmart target seems to have got this problem with student loans, and they like the brands of student loans. gap has the same problem all the stuff, to me, says, look, just go with what's least expensive. just go least expensive. >> student loan payments aimed at the bullseye. that's the keybanc downgrade >> i thought that was a very important piece. no one knows what's going to happen >> headwind for discretionary spending and it's specific to target's customer base more than any other? >> i didn't write the piece. i just read the piece. it's also saying big lots. i don't know >> i'm just asking you, because you're talking about target, saying we have a problem >> i thought the piece had gravitas >> i'm saying, okay, they're the only one >> no, everybody -- target -- yes. there's a line

if you would go and read it, it says, who has the most trouble where is it most levered target it's most levered to the student loan customer. i do this bulletin every morning, goes to everybody who's everybody, and what's interesting, david, is that the talk is that target is the one where people who have student loan issues, well, they may be shopping last. >> you might expect them to be a walmart when you combine things like s.n.a.p. work requirements, lower tax refunds, student loan obligations. >> the dollar general call was about s.n.a.p. and was about their customer not having as much money now, what i think is surprising is that when we read about all the stories about the fed, we keep hear consumer booming, consumer booming the consumer is not booming. the consumer is decelerating across the board so, i don't know where they get that i don't know where people get the fact that, david, that the fed is going against, you know -- there's great strength if i were the fed, i would just

go to a dead head concert. >> yes well -- >> i would go to grateful dead that's what i would do >> why not why wouldn't you it's really dead & company now, isn't it, carl >> i think it is do we have a photo >> is john mayer still playing >> mayer's part of it. >> you're kidding me >> there he is >> can we get a close-up of that >> i don't think we have the close-up >> i went to a ritz carlton in -- >> that is jerome powell, by the way, just to be clear. that is the fed chair. >> i went to a ritz carlton at the time half the dead played, the other half being dead, and i never felt so young in my life >> it's a certain demographic. >> ventas is downgraded. bring them in buses. >> dead & company, coming to a senior living near you >> very attractive >> apple's going to be a story today, kicking off its annual worldwide developer's

conference the company is expected to unveil that new mixed reality headset. price tag, $3,000, three times more meta's expensive head set they're set to deliver new operating systems for the iphone, ipad, mac, watch, tv today, it is "the ft" that says it's the most important new product for the company in years. >> i find that unless you get some company that is willing to get behind it and buy it for you, a la t-mobile with mike seifert, i think that's a very big price to pay >> you're not kidding it's a big price to pay >> $3,000? >> it may be too big a price to pay for the wireless carriers or anybody else >> verizon at&t, how are they able to finance with those balance sheets >> how are they able to finance the purchase of handsets >> the purchase of their infrastructure you know how all these companies have to have massive infrastructure >> their capital expenditures are very large they are able to because they still have important cash flows

coming in. significant cash flows >> we did not get the story of a lifetime that amazon's teaming up with dish that was fatuous, i think. >> you're talking about friday where we last left you, viewers, was, of course, with t-mobile, verizon, at&t, all down sharply, dish shares up sharply on this story originated in bloomberg that said that amazon was thinking about including a wireless offering amongst its prime offerings. then, during the course of friday, verizon and t-mobile both unusually so came out and said, we're not talking to amazon at&t already, we knew, was not talking to amazon, which only leaves dish as having been possible talking to amazon that is a story we've been hearing now for at least two years. doesn't mean it's not a possibility. an amazon spokesperson saying we have no plans, at least as of now, to be offering a wireless product. that said, we'll see if dish comes back down, and we'll see if there's any pop in verizon,

t-mobile, or at&t, all of which were down sharply on friday. >> well, the other thing we haven't mentioned is that there's this "journal" story about how the banks have to put up more capital. the hundred million dollar banks, morgan stanley, i thought it was interesting if you look at morgan stanley, admittedly, it's been hit because of the retirement, the stock's been unchanged since the mini-bank crisis i don't think it's brand-new price is a little lower than i thought, given that travel is so good i think this is a widely discounted story, and you buy these, not sell them >> at for apple, "the ft" piece points out, we never thought we'd pay more for a phone than a laptop, and yet we do now. is it unthinkable we pay $3,000 for one of these things? >> i think it is look at what happened with mark zuckerberg and with meta platforms. people -- and that's a platform that's very well aided by a.i.,

and it's not really been blowing things away. >> by the way, we're going to open pretty much at an all-time high on apple. b of a goes to $190 today. evercore goes to $210. >> i think apple here, the story remains what eddy cue told us when we went to the investment council. david, this is about a level of new customers coming in, maybe as many as a billion people from brazil, from the philippines, from indonesia, and from india, at the same time getting infrastructure buildout and service is just on fire. i mean, eddy cue is basically just saying, look, this is not only the sticky revenue stream, but we're going to put more much behind it. that's why i wanted to know, even though we saw a piece today about tnt, where tnt may go -- i'm sorry, where nba may go, look, you know that if apple wanted the nba, they would say -- >> yeah, i got to read whatever piece you're referring to because i'm trying to follow that closely that bidding for the nba rights is going to be interesting

>> don't you think >> it is important, not just because of what it means for the nba and the companies that get it, but it will have an impact on the bundle. it will be very important for warner bros. discovery that said, back to apple and a $3,000 headset, if we can go back there >> $3,000 is a lot of money. >> it's an enormous amount of money. it seems to be a very niche product, and it's unclear that people like to put these things on their heads for an extended period of time >> it won't really work until they flatten it out. >> if i can walk into the holodeck, then i'm happy >> did you watch the next a.i. did you sit down and watch the entire -- >> no, jensen? >> it's now available, and you can see that the -- >> the entire what what are you talking about >> the 190-minute computex speech in taiwan it's really amazing. what it's really about is getting 3d without having to

have a headset and by the way, here, right now, right now. >> well, given apple's track record, would you expect them, at this late stage, to have figured some of that stuff out >> yes, i would. >> typically what they do. >> look, i just think it's the price point. >> what's the -- what's that going to cost? >> nothing >> what's available right now, the 3d i don't understand the rich guys are going to go from a home theater to a home holodeck hedge fund buddies in their basement next to the wine and the gym and the movie theater, and it's going to be, and here's our holodeck thing >> why don't you watch the whole thing? it's one of the most exciting things i've ever seen. it is. it's like "succession," last episode. >> the jensen speech >> it's amazing. it's amazing look, it does not make you feel the same way about anything after you watch it, other than maybe -- >> i have to watch it? can i just listen to it? can i podcast it when i'm walking around >> i think it's important to watch him go back and forth,

back and forth >> with the what >> with the audience to all the people in taiwan where he sometimes speaks chinese. david, you'll love it. >> all right >> it's so much better than "citadel. that was really a disappointment >> a rollicking good time? >> yeah. >> with the writer's strike, you need jensen. >> we'll talk more we got a big b of a tech conference this week citi has some comments on chips as well. we'll talk some oil rallying now after the saudis did pledge n.rther output cuts of their ow and with that, we'll start this week with futures pretty much close to the flat line and jelly beans. the number one brand for hair, skin and nails. with two times more biotin to bring out more of your inner beauty. get more with nature's bounty.

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nasdaq, it's on pace for the best first half since 1991 here's some premarket gainers on the ndx. you'll see palo alto getting added to the s&p effective june 16th tesla is in there as well with 'll a sales up weget cramer's "mad dash," countdown to the opening bell in a moment er 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. ted! ted! ted! oh ted in finance. you're a rock star!

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about, let's call it, seven and a half minutes from now. we want to talk a little palo alto >> well, it was just added to the s&p, which is a very big deal, because dish is coming out. there's a lot of money still levered to the s&p, and you have to have a certain number of free cash flow quarters >> and dish is coming out. $3.5 billion market cap. we've talked about it a lot. this is obviously a lot larger than $3.5 billion. >> right here, the short spreader rumor that nikesh was going to miss the quarter, a lot of that had to do with the fact that there's been some churn in the winners among this group sentinel one had a bad quarter i thought cloudflare had an okay quarter. okta had a bad quarter crowdstrike had a good quarter, but they're all cloud native nikesh arora, who was awarded a very long-term contract, a lot of people were worried he would be leaving, he's been so successful, it's time to move on this is a $70 billion market could be the first hundred

billion dollar cybersecurity market cap, and what he said is there's been no let-up whatsoever in spending cybersecurity. if anything, people have found that -- i don't know how lately you've been hacked >> is this moved because of the addition to the s&p? >> absolutely. >> it's not based on any news. it's just based on those who track the index won't have to buy it >> my travel trust position, is this reason to own it? no it's a reason to show you why it went up. >> something else you said very quickly, he signed a new long-term contract >> that was just announced, 6:00 a.m >> there were rumors around, would he go to another very large company? i don't believe they were true, but he's a pretty known quantity that is -- garners interest. >> there's been a belief that maybe the next challenge will be something that would be outside the group. remember, he did a great job in alphabet, but what really matters is that this is probably one of the stronger secular growth trends. >> got it. >> and it did not end.

i mean, there are companies -- like okta faltered really badly in its special kind of security that it does and sentinel was a disaster. so, people just said, well, i guess every -- no. it's a very winner take all, loser take none proposition. >> all right opening bell just a few minutes away by the way, don't forget, you can catch us any time, anywhere, by listening to and following the "squawk on the street: opening bell" podcast.

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>> announcer: the opening bell is brought to you by nuveen, a leader in income, alternatives, and responsible investing. oil's on the rise this morning. saudi arabia announcing plans to cut output by another 1 million barrels a day in july. that's on top of the reductions by opec plus nations and it's in the wake of prices falling by double digits from the april highs. we got to $75.06 today >> i'm going to fade this. the reason is because we have a very big -- the ukrainians are making their move in this counteroffensive, and the one thing that's been left out is what's russia really doing i think russia needs very much

to fund defense here and the easiest way to fund it is with oil. now, david, the saudis take off a million, but nobody else is really excited about doing it. >> right >> we know the chinese may be slowing down, but we know india's not slowing down we know there's tremendous demand for oil, but what's most important is the u.s. -- which is never mentioned in these stories, will take advantage of this, because we have new figures about how the u.s. -- >> 14 million barrels a day? >> we're going to get there in a year and a half. >> where are we right now? >> a little more than 12 but all you ever hear about is the public ones. but there was a huge amount of private equity money went toward and they are pumping like mad. so, whatever the saudis cut back, we will just make up, and russia will make up. so, i want to fade this rally very badly, and if you own some american ones that are up big today, i think you should take it >> meanwhile, you got morgan stanley joining goldman and cutting their china target

>> china's -- >> on the index. >> there's no doubt about it china is now down to a level of spending they can get with real estate we're still seeing luxury makers even in the month of may having a bad month there. so -- >> let's get the opening bell here at the cnbc realtime exchange at the big board, it is wyndham hotels and resorts, celebrating its fifth listing anniversary. at the nasdaq, a jpmorgan etf. we mentioned morgan stanley at the open, and mike wilson, who not only keeps 3,900 year-end, his base case, but now cuts earnings to 185. >> well, i'll tell you what's discouraging about him this was the greatest tech rally since 1991 it was an extraordinary rally. it was there for everybody who

could be had except for people like mike wilson mike wilson may say, my numbers were really about, i don't know, dupont and archer daniels, and i use those as metaphors, but this was an amazing rally, and this man did not get it, and i thought it took a lot of guts for him to come out and say, okay, this is not the time to own or whatever. the runs that we saw in stocks -- and i'm talking about the obvious -- i was blasted somebody said to me, you know, jim, look what you have for your travel trust i mean, give me a break. you had apple and amazon and you had nvidia do something interesting what was i supposed to do interesting, david i was supposed to do pulte homes? >> that one, you can just keep going with if anybody questions you, just say, nvidia. just the, adam parker frequent guest, call it the adam parker

memorial $2 trillion market cap for nvidia >> if you watched the video, you would say, listen, there's a trillion dollars in datacenter and everything based on the cpu, intel. it's going to move off to the gpu, which is nvidia and all you have to do is think 2d versus 3d you have to think digital twins. you have to think ray trace. you have to think, basically, that you talk to your computer i mean, a lot of what jensen's doing is saying, look, you know, you don't have to be a coder you just tell it, type in what you want a lot of this is chatgpt, but you're going to another level, and he's basically scrapping everything everything that you know >> do you have any fundamental rigor, though, in what you're doing here in terms of telling people to buy a stock that's trading at 40 years worth of sales? at what point do you say valuation matters? >> i said next 50 points, going down but what i'm saying is if you come up with a brand-new method for computing, is it not an

iphone moment? by the way, if you watch the video, you're really blown away with what a cpu does, versus what a gpu does. >> that's citi's point this morning. they say, the stock is trading at a 40% premium to the market it will crowd out cpu spend, all this race to a.i >> it has to look, one of the things that you can think of is just that what -- let's use wtp, because i have trade desk on tonight, which is the big competitor to alphabet wtp, which a lot of people thought, wait a second, large advertising firm, they'll be the most hurt. they're making it so that rather than you just getting something that's wpushed to you, you get what's relevant to you it's done in a compression way he has an ad for a car i've got to tell you, it just looks very different from what you're -- what you expect when it comes to a flat screen. so, i mean, all that he has -- that jensen's trying to do is say, everything you have is going to be thrown away, and who's embracing this

alphabet's embracing it. meta, surprisingly, really embracing it oracle these are companies -- and of course microsoft they just love it. and they can't -- these things, david, they're hundredsof millions of dollars, these devices. but they're so much faster >> and even adam, in that those, talks about his own order for, what, five gpus? >> wow, is he rich >> that's a lot of gpus, by the way. i know we ordered five new gpus on the cloud for more efficient language processing this week. >> he's building some sort of bunker somewhere i think he fears artificial intelligence coming after him. >> well, i'm sure we'll get an opportunity to ask him soon enough >> by the way, bumpers -- jensen always talks about bumpers and how there's an understanding -- there's understanding that they're powerful, but they're controlled by us >> for now, they're controlled by us. we don't need to get into it at some point, they may not be, and then it's over >> robots right now are pushed

these robots ride, and they go around a factory, and one of the things -- there's trillions of dollars spent on factories, and what jensen is saying is, if you could design a model, there would be a lot less waste. i know i keep coming back to him, but this is the most monumental move i've seen in a stock in a short period of time, i think, ever. >> and parker notes that it is the largest ever increase in guidance >> yes >> he looks at historic increases in revenue guide, and this is number one >> jim has mentioned a number of times it's being the main reason i would question valuation or at least say, hey, and you would say, hey, $4 billion nobody's ever seen a guide like that >> when you ask companies like applied materials, how are you doing? well, nvidia put a lot of works with us. by the way, a company called cadence is mentioned first they help build the actual processors really, really good.

now, the piping is indeed broadcom, which had this weird move where it went down, then up, and marvell. the issue is, there are really only a dozen companies >> these are all the companies that are involved in the -- >> in the switch from cpu to gpu. now, remember, the -- >> and obviously, the most important is still taiwan semi, because none of that happens without taiwan semi. >> where did they do the meeting? taiwan semi. the current configuration in the datacenter is 5% cpu, and now you think about intel, and 95% cpu, 5% gpu, which is jensen the new ones are 95% gpu, jensen, 5% cpu because they work so much faster, burn so much less, and they -- >> although they generate more heat, don't they >> no, that's what's surprising. they use much less heat than you think. >> than you think? but is it more than your typical datacenter because i do wonder about that >> he has statistics that say

it's half of what people realize. that they burn really light. now, look, i mean, they put the thing out there, and by the way, it starts with jensen saying, i know it's too long, and it's beautiful music, soaring music that's written by -- everything's written by the gpus >> the music is written by the a.i. >> i think he has this moment where he says, for 60 years, we have had flat -- he went to the '64 world spirit, which was in queens >> it was in queens. very near where i grew up. in fact, my mom used to roll me over there in my, you know -- >> that's sensational. >> thank you my stroller. >> but that was a 2d cell phone and that's because they did this -- they compressed it and brought it out that is over that will no longer be the way that you get it. you will get it in 3d. and it will look just like you, and you can -- it isn't you. it looks like you. >> right okay >> but -- >> we're going to live on,

aren't we? by the way, we are all going to live on, even after we die >> that's ted williams >> no, it's not ted williams i'm going to be in the cloud my 3d representation, generative a.i. will be able to basically mimic not just my voice but the way i think in some way. think of all the work. nobody's said more words than you have on television that have been recorded. >> the algo has you figured out. >> you hold the record >> i had laryngitis problems last week. >> you hold the record for words on tv. i mean, you'll live on forever >> i think that's an interesting prospect it's not where i was going >> i know, but i can't help but think about those things >> imagine there's a trillion dollars that's spent that he says is now worthless, and everybody has to go and do new things and that's -- oracle, alphabet, these are by no means insignificant. i keep coming back to zuckerberg really spending a lot of money in this. what is he going to do that would be reels, but that might actually be his 3 to $4 billion on metaverse that he's spending. but jensen goes back and back to

meta as being a crucial player in this. obviously, microsoft is. but i find that meta is not one that i would necessarily have thought would be, you know, i say they have a close relationship look, what can i say i'm trying to justify a move of a lifetime >> you're putting it together for a lot of people in terms of what is one of the more important developments, no doubt. >> thank you >> and that's why we talk about it every day >> that was nice of you. >> you're welcome. guys, you know, at&t, verizon, t-mobile, barely up. you would have thought, given the denials on friday, after the story that the market might say, all right, we're going to buy a little t-mo. no no in fact, it's down three cents >> it did have a 2.5-point move in the last 7 minutes. >> on friday yeah it did move higher -- i mean, ended lower but not as low as it had been you can see what it did there. that gives you a sense but still, nowhere near where it was before those stories, even though, again, verizon says,

we're not talking to them. t-mobile says, we're not talking to them. at&t's not talking to them doesn't leave a lot. >> well, i don't know what to say. i know that prime is still a bargain. did you see the amazon, how many deals, how many different things that jassy's canceled? you know, like, more than 25 projects that were losing money. >> that are no longer -- >> for those of us who have been very critical of jassy, not personally, because he's really a great guy, but saying, when is he going to start making the cutbacks how about cutting back in projects that were not making money? i think it's significant >> and the bulls will tell you that they have been overlooked at amazon in terms of what they have been able to do in a.i. as well, and that there are a lot of different applications that they're going to be offering their cloud customers. >> that's a very good analysis >> for aws so, those are people who are positive guys, real quick on the deal front, not much this morning >> are you going to -- >> no, it's no merger monday there's a name that's $1.6 billion deal. >> it was up 55% >> we got to go there.

it shows you just how sad it really is for deal-making so far. it's private equity. there it is. big premium. >> sad >> $1.6 billion. remember, they took gardner private, then sold it. it's the same thing. flow control that kind of stuff i wanted to talk about this ametisis home care infusion, had a deal to be acquired by option care health for 3.0213 shares of option care health that was announced back in early may. they had the right to go out and look at other potential bids, and they got one 100 bucks in cash from optum >> that's very interesting >> and so, that stock, option care, which was the buyer, is up why? well, first of all, i'll tell you, i know a number of large shareholders there they were going to have a very hard time getting the vote now they're probably happy that they don't even have to go through with it because,

frankly, they weren't necessarily going to get the vote but now it may be seen as a takeover candidate, option care. and there you got the actual acquired company that, again, is now in talks to be acquired by unh, optum, for a hundred bucks a share, cash. by the way, the value of the original deal was like $98 but then it had come down to $86 because of the decline in option care health's stock price. >> what does that say about that one niche? >> there's the background to all this thing so, now, they're engaging with optum, a hundred bucks a share i know home health care is important. there's a lot of old people. they need home infusions it's a growth business in many ways >> you know what's funny i've been recommending a company -- >> some concern about antitrust, but they're too small. no concern on unh buying this thing. we'll see. >> lendy is an oxygen play, a hydrogen play. this is a very sophisticated

combustion, industrial gas it's been such a great business for them >> lindy >> i think it's -- i've been waiting for consolidation of that group we barely talked about the consolidation that's been going on in the walgreens-cvs space. cvs just did a very big deal last week, spoken by goldman, and a lot of -- >> did a big bond deal, yeah >> they're really trying to diversify away from, i think, the brick and mortar >> yeah. yeah i mean, right. and moving into other areas, including health care, not to mention they own aetna >> i thought that was a good move that was larry, but again, when i read about what we started with the challenge brick and mortar, part of the challenge that no one wants to talk about still is the pilfirage stealing there's also the boycotts we

haven't addressed, which started against target and moved to kohl's the boycotts, very emotionally charged, but you see these things, and you say, well, target has really gone down endlessly since what a lot of people thought was an okay quarter. not a bad quarter. >> yeah, actually, the underperformance to the market began prior to the controversy about its pride merchandise. but that's a historic -- we had more than a dozen straight down days haven't seen that in 20-plus years. >> and you know, sure, they have maybe too much discretionary, but you know, david, you could have a lot of discretionary and still have a very good food business like target has, very good clothing business, but that number, that half a billion in dish of stealing, with obviously no real course of action, nothing. >> no, yeah, i mean, you do, listen, overall, it just means they're going to charge higher prices >> exactly >> so, it's just a cost to everybody. guys, continue to closely follow microsoft's attempts to close its deal to acquire activision,

despite what is that big, big impediment, being the cma, the regulatory authority in the uk it did want to note an "ft" story in which they interviewed sony's chief executive remember, sony has been such an important opponent of the deal itself, and yet in this interview, sony's chief executive seems to downplay how quickly gaming will really move to the cloud here's a quote "i think cloud itself is an amazing business model, but when it comes to games, the technical difficulties are high. and then he cited latency, fast response times are needed for gamers, being a big issue, so there will be challenges to cloud gaming he does say they want to take on those challenges, but it's being noticed today by many who are still very focused on whether or not microsoft can get this thing to the finish line as the odds against it seem to still be fairly high, and they do note, those are odd words from sony's

chief executive, because they seem to undermine the very case being made by the cma, which is under appeal, not to mention our own ftc, which has its issues. we'll see if they even get to court on that or a magistrate as they plan to >> i'm thinking right now, my brain, just got a lot going on right now, particularly because of the temporal migraine i woke up with. >> sorry to hear that. >> that's all right. david, i know you're going to say this is overkill, but jensen directly targets this and says that there's no more latency under his -- >> if there is no more latency, that would be an important move in terms of letting things be on the cloud. you don't need the box right there. >> exactly right >> you've got the -- you've got to talk to the network >> yeah. >> let's get some pmis with rick santelli hey, rick. >> yes, the first of a group of pmis that will coming out. these are s&p global and on the services side, carl, our preliminary read was 55.1.

take away a couple tens. the final read now is 54.9 but like its predecessor before the revision, this is also the best level since april of '22 let's go to the composite, shall we our mid-month read, 54.5 our final read, 54.3 and light services that is still the best level going back to april of '22 we'll have factory orders, durable goods, and as i pointed out, ism, pmis at the top of the hour and "squawk on the street" will return after a very short break.

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let's get to jim and stop trading. >> i know we have this issue with the giant headsets. i think most of the tenor of the research this morning is more like morgan stanley, morgan stanley always had a good beat on apple, app store growth accelerates for a third consec positive month the abstract had been decelerating a lot is recognition it's gotten very broad i don't know how much people check in and see the new things people are doing the service has gotten very excited and more than what eddie talked to us -- it was a product setting, but we did talk about mls, an example of what's going on, which is that i think apple is making a major move so it's no longer up and down based on phones and that is going to change things so i just think that it's --

don't buy it off of this -- the product launch buy it because it's getting more consistent and people will think about it each launch. >> what evercorps argues. >> it's great piece about mid-single digit it sales growth, double digital earnings growth that would be one of the most sought-after stocks. you're seeing that not the headset. so don't feel like wow, the headset didn't work, i'm going to sell it that's a mistake. >> closing in on $3 trillion it's a little bit away but $2.87 trillion market value. >> very much on its own, not part of the universe. >> yeah. >> well the only universe it is part of is mega cap tech apple is up 40%, meta up 124%, amazon 48%, microsoft 40%, and nvidia up 167% this year. >> the bear market continues. >> well, a great chart last night on the mutual funds and

the hedge funds are way under because they didn't follow that move. >> they're stuck and watching the conference in d.c., rewatching what nvidia said, all the money that amazon is putting in to these things amazon is making a major move in brick and mortar again, because the downfall, we had a big move in the brick and mortar after the pandemic coming right back to amazon. it's amazing you know what's a new stock, meta on 17 sometimes next year's earnings david, did you know that >> yeah. >> 17 times. do you think in the year of efficiency you're living dangerously -- >> i don't know that he's going to get a higher multiple. >> it's not he, really much more of a company. >> it is. >> you're going to tackle that tonight? >> i have something that's interesting. company called trade desk, alphabet taking google on so

important, and then elf beauty is taking on everybody jeff green is a guy who says listen, we offer advertisers, everybody gets a better deal, and the whole cantor antitrust suit is based on the fact that you don't get a good deal on google jeff green has some very interesting things to say. >> david >> yeah. >> have a great show tonight. >> it will be a busy one. >> do my best. >> thank you. >> my voice back asbury park the whole time. >> "mad money" 6:00 p.m. eastern time we'lwah l tcapple, obviously all-time high this morning as we came within ten points of s&p 4300 trading experience. with innovation that lets you customize interfaces, charts and orders to your style of trading. personalized education to expand your perspective. and a dedicated trade desk of expert-level support. that will push you to be even better.

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good monday morning. welcome to another hour of "squawk on the street. i'm carl quintanilla with david faber, mike santoli, at post nine of the new york stock exchange sara eisen will join us with a guest. the ceo of hilton from ynyu's hospitality conference the s&p does climb 20% from that october closing low. busy week of eco data and

largely about apple. >> we are 30 minutes into the trading session. three movers we are watching shares of apple hitting all-time highs ahead of its developers event under three hours from now. we'll head live to cupertino ford pushing higher, upgraded to buy, wait $16 price target the risk-reward has improved the stock up 15% this year, up 1.25 at the moment on the day. and palo alto shares rallying, the company added to wolfe research's list of high conviction stocks wait $255 price target up 4% this morning. >> got pmis, now ism's turn. hey, rick. >> yes carl, the s&p global pmi started pushing interest rates down and now they're going down even more factory orders up 0.4 expecting up 0.8 negative revision in the

rearview mirror. we look at ex-transportation, we're expecting up 0.2 no, it's down 0.2. also a worse revision in the rearview mirror for minus 0.7 to minus 1% now let's go to durable goods, finals 1.1 remains at 1.1 but the minus 0.3 replaces minus 0.2. that's downgraded. and 1.3 remains if you look at goods orders nondefense aircraft, up 1.3% is actually downgrade from 1.4, but still the best since '21 the money ball what's moving markets here, 50.3 on ism services much weaker than we were expecting. we were expecting a number over 52 and 50.3 is the weakest level since we were under 50 in last year if we look at prices paid, 56.2.

56.2 that's going down. that's a good thing. 59.6 in the rearview mirror. 56.2 would be the weakest level going back to may of 2020. on the employment front remember we just had a very strong employment report. it dips below 50 below 50 49.2 that's the weakest level since -- it equals our october of 22 exactly the same 48.7 in june of last year to find a lower number, and finally, here are the trumpets playing on the final new orders for services, 52.9 that follows 56.1. 52.9 would be the weakest level going back to just last month when it was -- excuse me march, when it was 52.2 we could see interest rates move on 10s under 370, 368. as a matter of fact, we now see that interest rates are lower across the entire treasury

complex. carl, back to you. >> wow rick, thank you very much. rick santelli. mike santoli digests some of what rick gave us, namely the employment number in contraction and inventories on services at a two must year low. >> a counter point to the jobs numbers on friday where you had essentially the market reaction saying we can treat good news as good news simply because the fed officials had more or less delinked the employment report from what they might do in june. this would reinforce that market message, clearly as rick said, yields going lower on this suggests that, you know, the fed is not going to certainly be concerned about teems in, but we should maybe start to worry whether there's durability in the services sector at this point in terms of the expansion of the market. you know, it's not inconsistent with what the market has been doing, which is essentially having money rush into a lot of the all-weather growth stocks as we've been talking about a lot and it's gotten the s&p to this perch which is interesting, as you've been talking about within

1% of the august highs what was happening in august at 4300 on the s&p versus now 9% cpi, not yet convincingly on the way down the fed was aggressively saying we have a whole lot more to do in fact, about 2, 2.25 on the feds funds 2.40 in the forward earnings, now at 230 maybe the question is, does it make sense today? back then you had a cold splash of water from the fed and -- >> you made the point on friday, september is when powell said there would be some pain is that it the economic pain. it's been delayed, if not put off kind of indefinitely at this point. so i think the question here is, the makeup of the market this run to 4300 on the s&p because of how we got here and

because it's been dominated by a handful of large growth stocks, it's almost added to the wall of worry. in other words, the market is up 12% and people hate it they haven't been able to participate fully. it seems unrooebl reliable because it's not been broad. friday you saw hints energy and small caps and the laggard groups were participating. i think it's really interesting to talk about what kind of market this is doesn't feel like a bear market when you haven't made a new low in nine months people talk about up 20% i don't pay a lot of attention to that. the s&p above its 200-day average for 2 1/2 months by some definitions that's a new uptrend. the problem internally the market is not acting like it, it's not broad like bull markets are. >> you've made the point endless times, the amount of the mega caps, but what -- again, would there be a historic thing to look at in terms of how it might change and what that would mean for those stocks and/or the

broader market, if it was to become a broader rally >> sure. some folks have done the work to say what happens when the s&p is distinctly breaking tout a new relative high and you have futur fewer than half of all stocks uptrending something like two-thirds of the time it's improved as opposed to the index coming back down now, a lot of variation in that. everyone looks at these examples of, you know, 98, 99, 2000 when you had it persist for a year and a half and then it crashed and then you have other examples where you essentially have the rest of the market catch up as people get more clarity on the macro. you know, it's not easy to say it's one way or the other, but i do find it interesting that you have the professional community that feels uncomfortable with the way this is working. literally, mutual funds have rules that prevent them from opening index weight of apple and microsoft. you know, you can't participate if that's the way the market is

going to go. there were all these reports of heavy short positions in s&p index futures. record that's the shadow of people owning a handful of stocks and wanting to participate that way. you've seen the numbers. gross leverage of hedge funds is very high, long, short total add together net leverage is not high because they're short the index against a few names they like. >> that's getting into headlines this morning as well apple near 184 definitely the focus of the morning as they are about to reveal their first major product in a decade at wwdc this afternoon. steve covac is live on the scene with what's going to be an eventful day hey, steve. >> yeah. eventful is an understatement. it's going to happen in that building behind me, apple hq look, what we're expecting is this mixed reality headset that's a term you'll hear me saying throughout the day, what that really means is, the device, these are the devices that have, you know, a ski gogel look with cameras on the outside and screens on the inside, so

those cameras can pass through the images in the real world and then digital images put on top of that and then you ramp it up to full vr if you want to do gaming or immersive experience and a good example of what this technology is like is what meta has been doing the last year or so they had it with their meta quest pro headset and last week zuckerberg try to undercut today's announcement from apple with their newest quest 3 headset. that's going to be the star of the show of course there's going to be other stuff. this is the developers conference where they put out operating systems for iphone, ipad, mach, tv, watch, expecting upgrades as well new features there also another thing we should look out for on the ios side is any updates to apple wallet. interesting moves in the last move we got at last year's wwdc about the fin technology visions of apple i will be paying attention to that as well. >> thank you steve covac.

as apple's market cap closes in on $2.9 trillion let's continue the conversation and bring in evercorps's senior managing director. just raised his price target to it $210 a share. start off with the headset is it really going to become an important product for this company? >> you know, i think it's going to look like apple watch, start off slowly but pick up momentum as it finds its niche. the next compute, the next way we interact, then i think it's important for apple to have that marketplace. i think initially it's going to be a slower wrap like an apple watch, but you expect it will add more to their bottom line. >> such a high price point, though, doesn't it >> it's hard to imagine a large audience for a product that if the reports are accurate, is

$3,000. >> you know it is a high price, but i think iphones were a high price point, versus the nokia. right. apple has never been the low price provide are. it's always the higher end price provider the way to look at the asp number, what are the things you will not buy if you buy this, an iphone or camera with these headsets you will not need to buy a gaming console anymore or [ inaudible ] what other things that you are out of in your life and maybe that will justify the higher price points. >> yeah. apologize, but we're going to have to cut it short we're having some trouble. ar-vr may be here, but we can't seem to figure out how to get a brief connection thank you for taking a brief moment thank you. >> it would be great if apple came out for great audio for

television. >> sometimes we feel like we've stepped back into the 1950s. >> for sure. >> but apple is a story. i mean, it's sort of fascinating that everyone, more or less, looks at what's really to come and what the market size is going to be and sets it aside and said that can't be the reason you want to buy but the stock has behaved so well there's a little bit of that nagging memory of how people dismiss things like the air pods and the watch as insignificant and then it just sort of reinforces this entire attachment to the ecosystem. however, approaching 30 times earnings on the stock right now. it's kind of roughly a ceiling we got above that in 2021. you have to be aware of exactly what's built in here down to a half percent dividend yield. it's still a big capital return story. even there, a huge buyback is into the significant relative to the market value. >> and it is up even more. we are at the $2.9 trillion level. we've never seen a company

valued at that that's the highest value ever for a company -- >> there were fake numbers about aramco for a while. >> such a tiny - >> what's more remarkable they're doing all of it, the price action happening even as they try to reconstitute their supply chain and ordinarily should be disruptive ways, it's not being reflected -- >> there are a lot of ways you could imagine apple getting penalized for what's going on, the china exposure, whether it's really not being a core ai story at this point. that's the only thing that's driving other stocks of this size it gets the benefit of the doubt as they say. the capital reshuffling story is always there buffet is not selling anything they're buying back stock from everybody else free cash flow supports the story. >> all-time high back to the ipo i think in 1980. we'll watch that today big effect on the market as we go to break the road map for the rest of the hour more on the markets as the s&p and nasdaq continue to ride higher bun what are the risks to

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welcome back to "squawk on the street." the s&p and nasdaq continue their ride higher for the most part this morning. our next guest, though, does

expect the global economy to slow with risks skewed to the downside joining us morgan stanley chief economist seth carpenter with us you guys published a lot over the weekend. and the headline in one sense was that you do see your long-standing baseline of a soft landing intact at the same time you are removing some upside on earnings can you talk about the view right now? >> absolutely. i think, you know, fundamentally for the u.s., we're in a situation where the federal reserve is very much dedicated to getting the economy to slow down enough so that all of the inflationary pressures subside over time. i think last week's non-farm payrolls report was a reminder maybe there's some two-sided risks still, but, you know, we do think that the fed is going to ultimately succeed, whether last week's data were a little bit of a blip or not we'll get slowing in the economy to bring inflation down. that's important we don't think it means outright recession and we don't think it means millions in job losses,

but we think it means a substantial amount of slowing and if that happens, it's a guide on earnings. my colleague has been very clear for a long time, he sees a need for there to be a he reduction in people's expectations for earnings and with that some negative leverage. >> right 185 is quite a bit below consensus on epps for the year do you consider it a dramatic cut? >> i think there's lots of things that matters. clearly below consensus and by a pretty sizable margin. the economist in me says what is going to happen to the economy, we have to see some slowing, we have to see slowing in terms of overall spending, we're going to have to see slowing, more slowing in terms of employment, so that's got to start to weigh on companies i think the other part for us, as well, when i talk to mike about that call, is the job market is still tight. there's still a lot of open positions.

if you look at the number of payrolls in the u.s. economy relative to the level of output, we're still shorthanded. so that means we can get a big slowdown without there needing to be a wave of layoffs and that sort of lack of sort of cost control is going to have to weigh on firms as well. >> seth, to that point, is there anything going on that feels different from what you might expect textbook wise in terms of the lag effect on employment that you have to revise our outlook here some people have been calling for an outright recession for a while who say there's nothing unusual in the range of treasury yield kev inverts and housing has a downturn and you have this wave of weakening. are we in that mode of waiting for it to hit the ultimate employment picture, or is there something different going on now? >> i think there's a lot that's different right now. the one thing to keep in mind for everyone who says take the same playbook from every cycle

we've seen over the past 30 years, this is the only cycle over the past 30 years where the fed has been actively trying to slow the economy to bring inflation down as opposed to previous ones where they've been trying to limit the rise that one aspect of it is fundamentally different. i think covid was a kind of different cycle than other cycles we've seen and the job market got severely dislocated we went into covid, economic activity collapsed, employment collapsed. we got a very strong rebound in terms of economic activity, but only a partial rebound in terms of hiring, so the economy is shorthanded and that difference is absolutely key. normally recessions happen because the economy slows and we get massive layoffs and that reduction, the loss of labor market income causes another round of spending cuts, the amplifying mechanism we're going to short circuit that part because the economy is shorthanded. >> that's interesting. does that mean -- i've seen some other strategists on the street

looking for negative payroll prints beginning in q3 is that your base case >> it's not the base case, but i mean i think we have to keep in mind if anything is going on, if we are right and the economy is slowing down, boy, funny things will happen with the data from statistical sampling or because of noise look at last week's non-farm payroll print it surprised everyone to the upside could we see a similar surprise to the downside and get a few negative prints over the second half of the year, absolutely out of the six months of the second half of the year, two of those are negative and the rest are sort of 50 to 100,000 positive, i don't think that constitutes a recession. >> right. >> definitely a lot of material to digest from morgan stanley over the weekend we thank you for your -- being so prolific. good to see you. >> great to see you. thanks for having me. still ahead, we'll get a look at some of the morning's movers that you may have missed. we're back in two. ah, these bills are crazy. she

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we are just under an hour into the trading day let's get to bob pisani back from a well-deserved vacation.

he has a lot more for us this morning. >> i am happy to say in the land where my grandfather came from italy, it's alive and well, the wine, food is amazing. the good news is, the euro is great against the dollar, 107 right now. used to be 120, 125. it's great deal. i want to show you, european stocks which had rallied dramatically in the beginning of the year, out performed the s&p 500, look at that. the s&p is now out performing. this is the euro stocks, the s&p 500 of europe. in the last three weeks tech stocks have exploded to the upside everybody, mike has been talking about it where tech is going and now europe, which has had great year, is under performing by 1 or 2 percentage points to the s&p 500. the sectors today here, you see the usual groups performing well energy starting to move a little bit. banks are having a little bit of a problem today on regulatory talk and there's tech which is flatish. it's been up and down throughout the morning.

just look at the s&p 500 movers. you can see most of the time you still have the big cap tech names, apple, alphabet, moving it a few small discretionary names and walmart has been a stalwart as well. the chatter about new regulations for banks increasing capital requirements weighing on the regional banks today that's not surprising. we were waiting for those comment to come out. what's remarkable, the s&p 500, less than 1% from a 52-week high the old high 4305 on august 16th so you think, my gosh, we're going to have an explosion of new highs on the s&p 500 guess what's at a new high, everybody has been talking about it, apple. ingersoll rand and cintas, that's the new highs three. where are they tech stocks keep pushing the market up towards new highs but not necessarily individual stocks hitting new highs we need a broadening of the market and the broadening out thing here

here's the hope, over the weekend people were talking about fed pause, that's number one, hope for a broader rally, people talking about job growth still strong, debt ceiling deal, earnings holding up. mike wilson thing this morning, mike has been on the wrong side of this all year, to his credit, he has been consistent about it, but this is the strategist, strategists are top down people. 185 to 195 mike has been all year the average strategy -- i did this story before i left for italy two or three weeks ago, the average is $200 for the year the average analyst, a bomttom's up person is at 219. mike as you know, that has not changed at all this year 219, 220, we've been here three months you can laugh at the analysts say they're -- they're too late and don't do anything, but they're the ones that have been right so far. >> we're close to halfway through the year. >> i was looking just this morning s&p earnings yes, 219 is

the bottom up consensus. $100 of the 219 is from tech more than 50% of the tech sector is apple, microsoft, nvidia. so you got to get down -- only $85 left in mike's forecast for theyear for everything outside of sneak so the problem is - >> those numbers, the tech numbers have to fall apart to move that dial. >> to see this point presumably. you can get big losses running through banks. a lot of stuff has to happen to get down to 185. or you get revised down later after the fact that's happened as well sometimes. >> it seems unlikely those tech numbers will drop to the level that's going to move the dial on that 219. >> yeah. that might define downside risk. thanks, bob. as we head to a break, june is pride month and cnbc is celebrating all month long through the stories of corporate leaders and innovators here's george air rowson, the ceo of grinder >> we know that there's so much attack and hate in the community

today happening from lots of places in that context, grinder going public in november speaks to a lot of positive things. the extent to which we were celebrated on wall street when we went public and the amount of support we've gotten is fantastic. here's a company built by gay people for gay people where the ceo is gay, married, and with children grind er's board has nine members in totally, six of whom are gay, lesbian, trans, and to have a board like that is a really powerful testament.

lomita feed is 101 years old. when covid hit, we had some challenges. i heard about the payroll tax refund that allowed us to keep the people that have been here taking care of us. learn more at getrefunds.com.

i'm bertha coombs with your news update. russia says it thwarted a major ukrainian attack on the war's southeastern front lines

moscow claimed it was the beginning of kyiv's planned counter offensive. ukraine denied those claims and said that long anticipated attack is yet to come. government officials say none of the four people on board a plane that triggered a military response in d.c. survived when that plane crashed a short time later two f-16s were scrambled out of joint base andrews creating a sonic boom when the small jet entered restricted air space near d.c the fighters shadowed the plane which apparently had an unresponsive pilot until it crashed in virginia. the u.s. military released a video showing a close encounter between a chinese warship and american destroyer in the taiwan strait over the weekend. the u.s. said the chinese ship acted unsafely china defended its actions saying it always respects international law. the incident is the latest in a long series of flare-ups between

the two countries over taiwan. sara, carl, back over to you. >> thank you very much bertha coombs. summer travel expectations remain high. the u.s. travel association says over a quarter of americans plan to increase spending on leisure travel in the nx three months. but will economic pressures ultimately weigh on demand sara eisen joins us with a very special guest to take about that in a cnbc exclusive. good morning, sara. >> good morning, carl. yes, i am here at the marriott in times square where there's been a huge hospitality conference with my guest christopher nassetta, he is the ceo of hilton. just on the panel. >> thanks for having me. >> carl was talking about the strong demand that we're seeing for summer travel bookings any sign of a slowdown given some of the economic pressures we're looking at >> not so far. i mean, you would be -- i know with everything going on in the world everybody wants to will the business to be weaker, but the reality is, our three big

segments which are leisure, business, and meetings and events are all very strong i think we'll have the strongest summer season in our history, which will only, you know, surpass the last strongest summer which was last ummer, and then business transient demand continues to really pick up steam it's led by small, medium sized enterprises. they continue to be well over prior peaks. big businesses keep grinding up, a little bit slower pace then we're here with 3,000 people at the new york marriott marquee. the meetings and events business, the demand is off the hook so many people didn't do meetings and events for three clears they're now making up for lost time and they have to do these meetings and events that have taken place for time and eternity the out years, the end of this year and into '24, '25, meetings and events looks really good

inbound international is starting to pick up. we're not nearly back to where we were. >> sure. >> but that's starting to happen i think there are a bunch of tailwinds in the industry in terms of pent up demand, international travel, shifting and spending patterns to experiences and away from things you're seeing happen all against a headwind, a slower growth. >> what about business demand? you mentioned that it looks strong, and we have seen businesses certainly tech, banking, where productivity is in, cost cuts are in, so do you expect to see the same level of demand for business travel that we've been seeing in recent months >> what's interesting, i had an event with 300 of our biggest customers here about a month ago and we were talking to the tech folks, consulting, financial services and generally, even

with layoffs, everything going on, their needs are increasing, not decreasing which sounds odd, but the fact of the matter is, they're not anywhere near back to the levels of travel that they had precovid so while they're maybe not growing as fast as they were, they're still growing and the real story is, you know, what i commented before, sme, small, medium sized enterprises they're still traveling more than they ever have and when you talk to that customer, particularly in an environment where they're worried about things slowing, they have more needs to travel to keep their business moving forward. >> is business back to 2019 levels yet >> business travel is a little bit above on a revenue basis 2019. >> and you - >> driven by sme and not back on the basis of the big corporates. >> so international is not back as you mentioned. >> international is a far cry from where it was. >> is it china

china is opening up. >> china is opening up, but there are not many chinese people leaving china i was in china last week, had a terrific trip in shanghai, and china is open, they're past covid, people are -- there's a huge hustle and bustle, but not many chinese travelers at this point yet are leaving china. >> why >> there aren't a lot of flights to get out they haven't reissued passports for outbound chinese travelers the visa wait times to get into the united states from some of our biggest markets like china, india, brazil, mexico, and others, are still very long, many cases in the hundreds of days the chairman of the u.s. travel, my nighttime job - >> lobbying to speed that up. >> we've been working with the administration, which we've done with many administrations, to sort of speed up processing of visas, to get to a goal of 21

days, which we did during the obama years and we think we can do it again. the administration has been terrific in starting with state department really in the lead to address those issues so i think part of it is flight capacity and getting more flights, particularly as it relates to china, and then getting more folks in the consulates around the world and processing times and visas down. i think, you know, international inned down travel in the u.s. is probably 60% of what it was by our numbers precovid there is a huge tailwind of opportunity there and china, being in particular, is probably 10% what it was in '19 china is the number one outbound market in the world. china had 200 million outbound travelers. i think it's going to take time but i would expect chinese travelers want to travel the

world and i think the chinese government is going to want to encourage that i think this is just me talking, i think it's in part they have to get the chinese economy going again after zero covid and keeping their folks a little closer to home, allows them to ramp up the economy faster clearly over the next 6 or 12 months i think that changes. >> what's happening wit prices because we notice how much hotel prices are are they going to continue to rise >> the prices are a function of supply and demand. the laws of economics are alive and well everything is more expensive in our lives. go to the grocery store and buy eggs or bacon or go to the gas station, look at - >> how much higher are room rates -- >> i think they're a consequence of what happens with demand. something people aren't talking about here in the u.s. is supply is historically low, effectively no new additions to capacity.

>> because of higher rates >> higher rates, covid, people stopped building in covid. now it's expensive to build. cost of materials are more expensive. cost of labor is more expensive. interest rates are higher. because of all those things not much is getting built. that will be a pretty long cycle to get through so you're going to have two to four years, you've already had two to four years, of very low supply so then you don't have that as a problem. it's a function of demand. if the economy sort of has a recessionary period of time but a reasonably soft landing, and you get the benefit of some of these pent up demand pieces of business like international travel, business travel, that hasn't been done, meetings. >> prices stay firm. >> and they keep going up. when one of those two things changes, prices slack. >> what about snirg you have been -- we've -- the jobs report

just released much stronger than expected you have been the primary driver of job growth in this country but also making up for job losses during covid. how far are you along the way back - >> i would say - >> how much demand for labor >> i would say we're back to where we were. fewer people working in hotels because we got more efficient during covid and i think those are long-lasting efficiencies. in terms of the numbers of people we need, i would say we're 95% of the way to where we need -- the hiring is going to slow. >> the hiring is going slow. the hiring is going slow because we've been on a tear for the last year and a half. >> also are you working with a.i. on those efficiencies >> we are, but not in any material way yet that is affecting jobs a.i. for us, i think there's lots of buckets of opportunity i think there's revenue management, application, there are marketing applications, that can enhance revenues there's a whole bucket of

customer sort of experience elements of it, of just knowing more about customers being able in the moment to make better decisions, to make the experience better and there's some efficiencies that will come we've already seen it in accounting and hr and other areas. we're a business of people serving people we want to use a.i. to enable is giving our teams the tools they need to create even better experiences so our business is always going to require people to deliver real service. >> we don't want any robots greeting us in the lobby. >> you and me both. >> thank you very much for the time today at the hospitality conference christopher nassetta the ceo of hilton back over to you in the studio. >> sara, thank you for that interview. before we let you go, we know you had a big weekend you returned to your high school alma mater as this years a commencement speaker let's take a listen. >> none of our paths are predictable. none of them will proceed in a

straight line. none of them are easy. perhaps most importantly, what i learned is that your dreams in high school are valid and foundational they certainly were for me and i truly believe that in order to succeed at doing something you have to be passionate about it you don't have to know right now and opportunities always present themselves along the way and they'll surprise you, but make sure you are passionate >> i can imagine, actually a young sara eisen in tenth or 11th grade thinking i really hope one day i can sit down with the ceo of hilton. i mean i'm actually not kidding. that actually is you. >> that is me. so -- and that's why i told the story beforehand about how it was in high school where i started having these ambitions i was a writer for my high school newspaper "the common canvas" at seven hills in cincinnati and i used to do the teacher feature. that was the name, i got to interview the teachers about

their personal lives and learn about them, things that we as students didn't know about i always loved a good interview. always dreamt of interviewing christopher nassetta always dreamt of interviewing ceos and then, you know, i did this personal challenge project, david, during high school where when i was in high school, when columbine happened, the first major school shooting we had seen in this country and i did a -- i used a private/public access studio in cincinnati to host teen talk, my first time being on tv where i did this talk show talking to my friends about teen violence. that was when i fell in love with television. that was sort of my point is that you never know what path you will take. there will be twists and turns and surprises and ups and downs, but make sure you are happy doing it because i know you'll agree, david, you have to be super passionate to be successful it's something i see from the ceos that i interview. something i see from my successful colleagues like you. >> without a doubt

thank you. i'm sure it was great. and congrats again. >> it was a blast. thanks it was an honor. thank you. >> got to look up "teen talk." still ahead, a look at the growing scrutiny facing forever chemicals and come some are calling 3m and dupont uninvestable because of them don't go away. somebody would ask her something and she would just walk right past them, (laughs). she didn't know they were talking to her. i just could not hear. i was hesitant to get the hearing aids because of my short hair. but nobody even sees them. our nearly invisible hearing aids are just one reason we've been the brand leader for over 75 years. when i finally could hear for the first time, i could hear everything. unlock our best deal of the year during our 75th anniversary sale.

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three chemical makers reaching a deal friday to settle thousands of claims that they contaminated u.s. public water systems with p fast chemicals. 3m an important maker of these chemicals near a deal. seema moody joins us now it's a story you've been following for some time. >> 3m was set to go to trial today, but that's been delayed as it nears a possible settlement for one set of lawsuits over water contamination. that does not include a growing number of states who have also sued 3m and others it's one why analyst says 3m

specifically faces great risk. >> at this stage given valuation and what we know about the pfas litigation, we consider 3m to be uninvestable. >> reporter: dean dray says 3m is facing a potential 20 to $25 billion in liabilities tied to forever chemicals. maine recently joining a list of other states suing several manufactures. >> we're alleging that 3m and dupont created these chemicals, had the science that showed just how dangerous they were, how toxic they were, how they were going to last forever. >> reporter: chemicals that made their way into this high school just outside of bangor, maine, where the water is undrinkable due to high levels of pfas students being asked to drink bottled water. >> we're not fully understanding of why it is in our water and it is at the level we're at. >> reporter: 30 miles away the once thriving farm shut down due to toxic soil.

>> our land is contaminated with forever chemicals. as soon as we learned we shut down. >> reporter: what are the health risks associated with pfas chemicals. >> thyroid disease, certain kinds of cancer, kidney disease, liver dysfunction.3m sai it would end production of pfas all together by 2025 washington already taking action $10 billion of the infrastructure law used to addressthese man-made chemicals. >> i expect pfas to be a front page news item for the next couple of years. >> 3m tells cnbc it's committed to investing in water treatment. dupont says the legal claims are without merit. the pfas is in dental floss, food packaging, and other industrials are focused on water treatment and filtration two names there, danaher and

xylem. >> investors have been trying to deal with the liability for pfas from 3m for quite some time and another litigation -- >> earplugs. >> right, earplugs is there any sense these settlements are going to make it -- you said $20 to $25 billion, is that based on a number from the other litigation >> yeah. there's a lot of uncertainty around what the next step is but the potential settlement is a step in the right direction. that is how it's being viewed by the market it's important to note, it does not cover all the claims and litigation that 3m is facing right now. there's also possible litigation in europe with countries like netherlands seeking action as well so, $20 to $25 billion is seen as a pfas risk and $20 billion for the earplugs, where we expect a decision very soon. >> he expects it to be front train news because things like a train derailment, and this

doesn't seem -- >> we have to watch to see what the epa does they're expected to move forward with designating pfas a hazardous chemical if they do that, experts tell us that would open the door to even further litigation. >> quite a story a huge, important for some of the industrials. seema mody, thank you. coming up next hour, sara eisen has another exclusive from the nyu hospitality conference, jonathan tisch, co-owner of the giants and ceo of loews hotels 1e nsert a take on thcoum at1:00 a.m. eastern time

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welcome back on friday we spent a good amount of time talking about the story on bloomberg reporting that amazon was considering adding a wireless product to its prime offering that had the effect of impacting shares of t-mobile you can see it right there along with at&t and verizon. and shares of dish, actually that was then. during the course of friday, though, both verizon and t-mobile made the unusual step of saying, we're not talking to amazon about this. and at&t was not believed to have already been talking to

them, leaving only dish as the possibility. that possibility, of course, that dish, perhaps, would use what it is still building out as a nationwide 5g network to wholesale some of it to amazon and/or also use the deals it has in place with the likes of t-mobile for providing capacity to amazon, that's been around for quite some time. unclear where the story stands, but you did notice a bit of a rebound. a bit of a rebound in both shares of verizon and shares of t-mobile, perhaps not nearly what they lost overall in value. we all know competition between all three of the big providers, not to mention our parent company comcast and charter through its spectrum brand is quite significant. and you've got the likes of t-mobile, for example, and even verizon to some extent, moving in in terms of trying to offer a broadband wireless product in the form of 5g

a great deal ofcompetition the idea of amazon offering a low-cost entrant, won't disappear from the marketplace as an idea, but it did pressure all those shares we see a bit of a rebound. we should mention dish will no longer be part of the s&p 500 as well given its $3.8 billion market cap it won't will bereplaced by palo alto networks, which is actually up rather sharply as a result of its potential addition -- or not potential, its coming addition to the s&p 500. that will come it for "squawk on the street" this hour another big houromg ur y. cinyo

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visit coventrydirect.com. welcome back to "squawk on the street." i'm carl quintanilla with mike santoli at the new york stock exchange setting at again da for us today. fundstrat says their conviction that another 10% rally is ahead is getting stronger as we go into the month of june tom lee will break down what's adding to his bullishness. apple will add its newest product and wall street is excited. with the stock at all-time highs, is the enthusiasm overdone we'll speak with the morgan stanley analyst who says this could be a