good morning welcome to "squawk box" right here on cnbc here at the nasdaq market site in times inqsquare it is just me and melissa lee. becky and joe are off. if we opened up, we opened up 150 points lower nasdaq down 50 points. the treasury yeields with the 10-year treasury at 4.00 flat you never see that the 2-year treasury at 4.730. italian bank stocks hammered after the government approved a surprise 40% windfall tax on lenders profits in 2023.

italy's prime minister said it would derive from properties on h -- derived from higher interest rates. the net income ex-sceeding the growth for 2022 and 2023 citi estimated that would be equal to 19% of bank net profits for the year the tax would only apply to domestic net interest income >> if this were to happen in the united states -- >> it is not happening >> i know. i don't know what would happen to the world. >> it is like when hell freezes over scenario. 40% windfall profit tax on banks. >> do you think this is such a game changer that you would ever be in business in italy ever

again? >> i think they view banks as utilities in italy i think investors will think about certain industries now at the beck on call of the government it can be wiped out just like that it changes your money. >> chinese >> communist >> out of nowhere with the tech companies in china >> the trading >> certain industries. in other bank news, moody's cutting ratings with several banks and downgrading the biggest lenders. the credit strengths will be tested by funding risk and profitability. among those is m&t bank and

pinnacle and prosperity bank on the list most of the other banks are down materially more than m&t bank of new york mellon as well. the agency changing the outlook with 5th/3rd on that list. and a break even quarter with revenue coming up ahead of expectations for the paramount plus service the advertising revenue in the tv segment fell 10%. executives there saying they expect similar ad revenue in the quarter current, but forecast a rebound in the fourth quarter. the company announced agreement to sell simon & schuster for $1.6 billion

paramount would use the proceeds of the sale to pay down debt i say, as i said, "billions" on showtime which is streamed on paramount. >> oh, yes >> in the same way we say something that "oppenheimer. >> paramount said the bar was low with the 35% increase in viewership that's a lot you have to wonder with disney coming out and people are streaming more or paramount specific >> you know, this was -- the bar had been lowered this was a good quarter on a relative basis for them. they still need cash a cash business. >> the sale was good for them. shares of beyond meat plunging loss of 83 cents of share. it was better than analysts expected, but revenue fell short

of the $108 million estimate they cut the forecast for full year as they show no sign of recovery higher interest rates and recession contributed to the soft demand. the company is struggling that the products are overly processed. it is releasing an ad campaign that this is showing the process. lower actual real protein costs is a headwind for the fake protein which costs more >> it's all relative >> make choices at the grocery store and the paycheck is limited. we are watching shares of palantir 5 cents per share in line of revenue of $553 million. the current quarter revenue was higher than expected

the ceo sent a letter to shareholders to make the company eligible for the s&p 500 for the first time the board approved the first stock buyback program authorizing $1 billion in repurchase the stock has been on a tear this year up more than 180%. sitting right now at $18 you look at the chart and going back to may. softbank out with results after the close in tokyo the vision fund with the gain of $1.1 billion that is the first gain in the last five quarters the company with the surprise loss of $3.3 billion in the quarter. softbank had unrealized loss offset by gains of $5 billion. shareholder meeting in june

shows the company would shift from offense to defense. we have squawk booze news. the acquisition includes brewery and pubs associated with the brand of shock top it has been pushing into the category in november the acquisition will make it the fifth largest craft brewer in the u.s. 30% of revenue comes from beverage and alcohol it is diversifying 30% from cannabis and 10% is health and wellness. >> do you think investors will like that? you want the mix >> the mix opposed to pure play? >> yeah. >> it offers more balance.

>> it offers balance when the thc business is active? >> it may be a way to gain distribution in stores if they have a thc beverage that is allowed in the u.s. >> that's what it is about >> i'm not sure. >> i didn't know if they sell these things together the way pepsi sells soda and chips together do people sell alcohol and marijuana together >> thc beverages. >> that i get. >> or cannabis beverage. >> the beverage business >> it gives you the option i want to get to u.p.s. here earnings crossing in

$254 a share revenue falling short at 2$22.1 billion. u.p.s. is lowering expectations after the agreement with the tea teamsters. stock is down 7.p4% we will see if the other logistics companies report the stock down 7.4%. coming up, get ready for the trading day ahead. u.p.s. reporting eli lilly and under armour all report we will talk strategy. you are watching "squawk box" here on cnbc

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welcome back to "squawk box. we told you the softbank news and they will invest in the company a.r.m. this fall samsung is off slightly on that news. equity markets will build on the gains yesterday. the best since the middle tof june our next guest says the focus should be on international stocks let's bring in the co-head of investments at dornberg.

jeff, great to have you with us. what was notable about the big g gain was the big cap tech stocks is that why you have gotten cau cautious >> we are watching the consumer weaken and the economic cycle play out as you expect over the length in timeframe. we have seen positive earnings and we have been surprised by the resilience of the company's ability to pass through the increased prices to the end consumer and ability to support them the stocks have rallied. we pulled back and see recession in late this year or likely early 2024. >> i'm sure you saw the moody's downgrade of u.s. banks and highlighted the second quarter results with the quality of assets they have and headwinds with more on the commercial real

estate portfolio with the mild recession in 2024. do you agree with the call is that a source of concern for the markets? >> as always, it is a little bit on the late side we have been watching this for some time. it is 100% accurate. as it continues to shrink and everyone knows about the challenges with the commercial real estate side on the flip side, what we have seen is the consumer is hanging in the vision for losses continue to be lower than we expect you are really setting a dichotomy up with the smaller banks in the u.s. and larger banks in the u.s we focus on the defensive side of the banking sector and prefer to play the larnge money >> do you think the smaller to mid sized cap banks are the focus on the downgrade and we have seen the worst of it or is that another shoe to drop?

>> i think there may be another shoe to drop as we see the rea realized numbers in the space. i would suggest we are past the worst of it. there is a bit more to come. >> what triggers the consumer to actually fall out of bed we have seen the consumer hang in with inflation high inflation is rolling over now. what is it at this point >> i would say it is not so much inflation, but we have to look through one level deeper as we see the consumer, it is strong one thing we are watching is the 30-days delinquency to 60-days delinquency. that is i forgot to i can't make a payment. we are watching the latter half of this year companies have had resiliency to pass through the prices and the cons consumers' ability to absorb the prices with the student loan payments the back half of the year and

employment fall, we see the companies pull back on the hiring plans and that feeds through more than inflation has year to date. >> you are chatting during break and how you are coming in pessimistic and things turned out better are you worried at this point and maybe things will hold on? i think markets have more momentum in the phase and they have a pendulum which swings to the extreme. we may have more to go on the momentum here. >> that is true. we are turning bearish with the playbook play out. we see banks pull back on their lending. we see overall loans increase particularly with the subprime lender we see signs to recession, but it is playing out longer than

expected we are bearish and cautious, but there are interesting things to do you look at the international side and valuations are less expensive than in the u.s. >> u.s. yum china. i wonder if you are concerned about the chinese consumer with youth unemployment at a record high and they are not getting stimulus as people expected. that really gets to the young china consumer. >> that is right we have to keep in mind this is a decades long story the young china has the ability to double over the coming 10 or 15 years yes, absolutely. we are watching that space and that consumer in particular. they are challenged. looking over the longer term, we expect additional stimulus much like the pendulum swings in the u.s., the pendulum can swing in china.

>> are you worried about u.s. tech >> i would say no we no, we are avoiding that space we want to stay away from the a.i. stories we view a.i. as likely as an evolution and not a step change. there are a number of companies benefitting with the continued move in the chip space which is one area we like. >> jeff, thank you for coming by >> thank you coming up on the other side of the break, zoom updating the return to work policy asking employees to come in to work two days a week. interesting considering what they do. and as we head to break, look at shares of home depot and lowe's downgrading the retailers from out perform to weak over cautious consumer spending we are coaming right back as ""

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well come back even zoom, the company, now throwing in the towel on fully remote work. the company that cashed in on the digital remote work is requiring two days a week in person a majority of employees work a hybrid schedule and 2% working in-person full-time. amazon and meta and the federal government pushed for more time in the office citing the need for in-person collaboration. joining us in person, on her birthday, is lydia moynahan. reporter at the new york post. i promised if you come in, i would sing

it is good to do at the outset i can whistle. ♪ >> this is not what i signed up for. >> whistling is different. ♪ happy birthday to you ♪ >> it's a segment not that long. thank you for coming in. >> i will look for the dance and pirouette after the segment. >> what is going on here i'm surprised about this trend you spent time reporting on the in-person hybrid situation is it ever going to end or four days >> what's happening? >> when i first came in and talked about it, we talked about quiet quitting and now loud quitting that is amplified. when you have zoom, the company benefitted more than any other company from the work from home trend. it is saying there is a benefit to being in person a couple days

a week that's all you need to know. we did know there would be a reset after the pandemic we are not going back to a five-day schedule. i can work from home on friday and the world hasn't ended people don't quawant to give up that flexibility zoom says that is a trend a couple days a week we will see a hybrid model going forward. that is on wall street where you see people if you don't come in on saturday, don't bother coming in on sunday. >> you don't think five years from now it is back to five days i say this because it goes back to the cities and all of the municipal services and restaurants and businesses this is the debate around federal workers. how do you get people in d.c. back in the office it is still a ghost town half

the time not because you are in the office for the work product, but whether you need them there to make everything, quote, work >> is that the company's responsibility >> that's a great question i don't know if it is. i will say for those who with invested enormous amounts of money in real estate in offices, it is. >> that's why you see banks with a vested interest in real estate are calling people back. it is who holds the power in the economy. we saw the workers during the pandemic who held the power. they were able to call the shots. one thing i want to touch on is the lazy girl job trend that has been going viral on the internet >> i don't want to be sexist what is it >> i want to belabor this with two schools of thought lazy girl jobs videos have tens of millions of

views on tiktok. it is all the rage. >> are you in one? >> no. i don't want to get fired. >> it is wild. you look at these people who are actively recording themselves watching netflix in their pajamas while supposed to be on the clock. it is shocking i think that trend is not going to be long for this world. if you are able to copy and paste. >> are people seeing them getting fired? >> in some cases, yes. a year ago, there was a trend on social media where people record a day in the life videos. >> ridiculous videos yoga at the salad bar. >> they record them walking to the office and have one meeting and getting a massage. many were let go in the first round of tech layoffs. now we are seeing that replicated these jobs are less competitive.

they kiptypically out of college where people -- >> memos on chatgpt. >> if you write all your memos on chatgpt, then i think chatgpt can do your job. >> is that what is happening here >> in some cases, yes. >> i have seen tiktok with the lazy girls are doing that. >> unless they are not doing their jobs >> they say they will go to the gym now because they just filed a powerpoint with chatgpt. have you seen this >> i will note another lazy girl school of thought. that is a reaction to all of the hustle culture and work hard and play hard. >> why no lazy boys? >> i'm sure there are. >> andrew, you need to make that video. >> i think it is trademarked by

laz-e-boy. i know it is early in the morning. >> some other phrasing like loud quitting we have low motivation monday. it is a reaction to hustle culture and the burnout that a lot of people experience and realize if i'm getting paid $50,000 a year, there is a phrase act your wage they don't want to give up body and soul. >> we have to come up. >> act the wage you want >> certainly. >> young people at home. >> that's why you're here. dress for the wage you want, not the wage you have. >> exactly >> lydia, on her birthday, educating us >> about lazy girl >> we should make it a regular thing with all the phrases. >> what with ll they think of n?

>> happy birthday. i'll do a full song later. coming up, china out with export and import data later we will talk to michelle cabrera later. as we head to break, we have a look at the winners and losers of the s&p 500

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good morning welcome back to "squawk box" live from the nasdaq market site in times square. i'm andrew ross sorkin hanging out with melissa lee dow jones industrial average is opening down 188 points. s&p 500 would open off 20 points it was rainy yesterday overnight in china, the government saying exports fell by 14.5% in july the worst than the 12.5% drop expected i am pmports fell 12.4%.

president biden is expected to issue an executive order this week on curbing u.s. investment this china citing security and other concerns let's bring in michele caruso cabrera. >> good morning. >> you talked about it for some time what do we expect to hear and why did it take so long to get to this point? >> what we are expecting and we heard this before, but this is on executive order for the first time impose restrictions on u.s. investment in china in specific ways where companies would be prohibited before providing investment dollars in s semiconductors and artificial intelligence and quantum computing. they have been talking about this for more than a year. it has taken this long because

of the scope and scale for which se sectors. they were talking about p retroactive and they talked about deals that were already done or active inn vvestments a passive investment national security is hawkish over dollars going to china. the other thing that delayed it is first they want janet yellen who spoke to the chinese and our allies to let them know it was coming. >> we don't have a sense of the exact scope in terms of retroactive? i think if eo came out at this point, private equity and other firms stayed away from investing in china in recent years. >> i'm told retroactive is off the table. to your point, it has been

happening. de-risking before the u.s. government involved and the china select committee with so many things happening in china has meant equity firms have been disengaging from there this led to the national security with data transmission and the two companies spying what is happening, u.s. companies said we will slide off the chinese subsidiary because china made it illegal for that chinese sub sidiary to send data back to the united states. how do you know the profit if they can't send back information? >> will it be the u.s. going at it alone or will allies join in? had. >> that is the big question. we have seen the allies going

along with the advanced semiconductors and the equipment that makes advanced semiconductors we have to see the europeans are skittish about these things at the same time, they have started to impose restrictions on investment from china in ways they never have before and starting to talk about outside investment controls. it is not out of the question where a few years ago it would have been. >> do you think this ruffles the feathers or is this a long string in acts of our industries with walled off from national security industries? >> oh, yeah. i think there will be a negative reaction from china. the point here is to prevent the

chinese military from gaining advantages over the u.s. military with the useof u.s. investment dollars countries don't want u.s. to wittingly or unwittingly help the chinese military in ways we would be at a disadvantage if we went to war. the chinese are cognizant of that we will see restrictions on germanium. look at the situation with the chinese and russia patrols in international waters near alaska in ways we have not seen them in the past >> do you think we see retaliation specifically for this in the tit-for-tat or general retaliation with the patrols to put us on alert

>> it is something symmetrical which would not have a lot of impact because we don't have a lot of chinese investment into the united states. it has to be some other measure. what they might do is work on the europeans to prevent them from doing more where they have more leverage with germany being more reliant on exports to china and business in china. >> i have to ask you about italy and the banks situation. 40% tax on quote/unquote excess profits. it seems draconian not surprising it is italy >> i think what is surprising is the business community really backed this government given the choices out there.

the previous prime mi minister not as aggressive. i'm sure what italian bankers are saying is they were punished for more than a decade by negative interest rates or zero interest rates the banking industry in italy struggled. we didn't go to the negative interest rates in the united states they did in italy. that is killer now they are getting punished for excess profits i'm sure tnot sure this is a do deal i'm sure there will be pushback from the banking community and business community to the italian government >> all right michelle, great to see you >> great to see you. >> michelle caruso-cabrera. coming up, amazon expanding

ben pefits for pemployees. and roger ferguson will join us about the state of the economy. you get the best of "squawk box" on your favorite podcast app and you can list aenny time. we're coming right back. e is alt . almost is just another word for not as good as mine. save 50% on the sleep number limited edition smart bed. plus, 36 month financing on select smart beds. shop now only at sleep number. the first time you made a sale online with godaddy was also the first time you heard of a town named dinosaur, colorado. we just got an order from dinosaur, colorado. start an easy to build, powerful website for free with a partner that always puts you first. start for free at godaddy.com sweat isn't sweet. it's salty. lmnt. more electrolytes. zero sugar. you feel the difference when you get it right. stay salty.

welcome back u.s. equities this hour in the red. solidly in the red dow jones industrial average off

188 points s&p off 23 points. nasdaq down 71 points. let's look at the pre-market decliners in the dow looking at jpmorgan chase and home depot and intel and goldman sachs and p&g off 1%. according to the world health organization, 1 in 6 people experiencing infertility. amazon is expanding family planning benefits in over 50 countries. bertha coombs has more on that good morning >> good morning, andrew. amazon is tapping maven clinics to expand fertility and family planning benefits to workers in 50 countries maven served more than 600 employers covering 15 million lives with the services in 35 languages. amazon with 1.5 million workers worldwide is a big win >> we are now seeing the global

push amazon being one of the first and microsoft is another we started in 2014 this continued to grow our market and continues to prove to the world that it needs to take care of women and families not only do you have a better healthcare system in the countries, but a better industry >> amazon offers fertility services in the u.s. and canada through a company which reported 43% year over year revenue growth the global ben pefitts needed a solution for governments with a health system. >> this is not an easy journey each if there are great countries with great social support systems, but knowing where to go. primary care or ob-gyn or

surrogacy or adoption? there are many options on the journey. having a company with the resources to help in that journey is really something that is a global need >> and huge global market now expected to reach $85 billion by 2028 according to analysts at eyemark group. shares have had a nice run this year as we are seeing so many companies looking to offer these benefits for workers. back to you. >> bertha, what is the issue for the employers choosing these benefits with the providers? >> one issue is they are having a fatigue with single-point solutions. that is where you see different services to say we can offer a

bunch of things to help your employers. a lot of these companies like maven and progyny started with family planning and fertility, but expanded to menopause and other issues to provide a comprehensive solution >> fair enough bertha, thank you for the report coming up, shares of paramount global higher after an the earnings in the deal to sell simon & schuster 7 coming up next. you can watch us any time on the cnbc app ( ♪♪ ) ( ♪♪ ) ( sfx: people celebrating ) ( ♪♪ ) ( sfx: people celebrating )

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a billionaire is close to a deal barring any snags a merger would create a wireless company rivalling verizon and at&t the market value is about $4 billion, while echo star is half of that. and then take a look at where this stock is, 3%. the company reported better than expected in profits. and a private equity giant looks at more. good morning, tom. >> good morning, andrew. good to see you. >> what did you think of the earnings we started to see an uptick in

the stocks and a bit of a turn around in the businesses of a number of these streamers? >> it was a different tone than what bob iger took in his cnbc interview. this was much more we have great programming, we have many windows to exploit it through, including a lot of licensing the legacy business we think will get a bit better on the advertising side, and the streaming path we are on is fine they are clearly doing the best they can with the hand they have been dealt it's not a great hand. it's hard to argue paramount will have the scale it needs to overcome the legacy decline, the

legacy media business decline it's facing. >> are all these folks in media land, they have a chessboard in front of them and think long-term is consolidation, and they are afraid this administration from an antitrust perspective would block a transaction. do you think that's the right way to think about this? there are so many chess pieces on the board it would be a hard argument for the government to make and win >> i agree with you, andrew. look, the government lost the argument that the at&t acquisition of warner was going to be anti-competitive, and the dynamics for the legacy media business has worsened terribly since then i don't think it's so much

antitrust concern. there's unique concerns about broadcasts licenses and being able to combine certain other broadcast assets, but it's more of a question of who wants to double down with such secular declining assets, with cable fees declining and that is declining with advertising revenue, and declining viewership -- >> well, does it become private equity simon & schuster, it generates a lot of cash and there are many businesses that do that but don't get the multiple because they don't have the growth >> it's not a big growth business, but it's growing and it's generating cash it faces different dynamics than

traditional tv assets. i am not sure there's a great answer there certainly consolidation allows you to take out significant costs and paramount is doing some of its own -- well, beyond someone-time cost savings, it's not clear that there's anything about those kind of consolidations that is going to accelerate growth, particularly on the streaming side. as a result i think everybody is somewhat cautious that that is necessarily the best answer. >> at these valuations, we have netflix, walt disney -- i don't know if you can see the screen right now, tom but is there a stock there that you would want to own? >> the only one is that not burdened by legacy media

decline, and i have been talking about this for a long time, and it's netflix it's one thing when you can just focus on streaming growth. it's another thing when you are half in to streaming, and still trying to manage a legacy business and trying to manage where else you sell your programming beyond your own streaming service. i think there's a real question can you be half in to the streaming business and still drive substantial success, and i think all the other companies still have to try and prove that netflix, on the other hand, has a clear growth path ahead of that and is cash positive already on the streaming side and can take advantage of the cash to drive its competitive place relative to the others >> tom, we have to run i wanted to ask you about max because time warner -- can't say that anymore, because warner

brothers could have sports here on top of its service, but we will talk about that later thank you. >> thank you for having me and then select trial result are out showing a clinically meaning reduction for the obesity drug those shares were up 9% on the back of these results as well, and we will have the full story after the break. a you are watching "squawk box" on cnbc

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to improve joint comfort in 7 days, with significant improvement over time. ( ♪♪ ) good morning monday's market momentum losing steam this morning futures lower as investors weigh key inflation data later this week and ups, the reaction from the street after the company cut its revenue forecast, and that stock i don't want to say plunging this morning, but down in a big way plus, labor talks as a strike is looming and the former

ford ceo joins us, as the second hour of "squawk box" begins right now. good morning, and welcome back to "squawk box" here on cnbc we are live at the nasdaq market in times square. i'm andrew ross sorkin, and joe and becky are off. and the dow is off by 211 points, and the nasdaq looking to open 85 points off, and the s&p 500 looking to open down about 26 points. we will talk about some of the stocks moving that lower treasuries right now, the 10-year note -- if you want to buy oil by the barrel, you can

do it. crypto to the extent that's now a barometer of the risk on or risk off -- i don't know, is that a barometer anymore we have been hanging around that number for quite sometime. yeah, let's get to dom chu >> on the transportation side of things, the premarket headlines are being driven in part by transportation we are going to start with the economic bellwethers out there like ups the shipping giant is falling to the tune of 4.5% just around 7 or 8,000 shares of involve, and profits per share came in better than expected but revenue fell shy of estimates due to e-commerce package deliveries there was a new labor contract that is leading ups to cut its

full year revenue and operating profit margins outlook and if you look at ups, you have to check fedex, and both shares in focus and appear to be sliding in sympathy alongside the move with ups. eli lily jumped over 150,000 shares of volume so far after it reported better than expected volumes, and driven in part by stronger growth by the autoimmune and diabetes treatment franchises we will stick on the pharma front but not on the earning sides. tphoef yo said its anti-obesity drug exceeded expectations in a

late-stage trial with that drug's ability to reduce the risk of having a major cardio event like a stroke. both stocks have been a big benefit around the potential future revenue growth of some of the weight loss drugs. melissa, tpnovo earnings not related. >> what is known as the select trial, dom, is it studied patients for two years for once a week treatments and found a 20% reduction in cardiovascular events this is way beyond what many people are expecting what this does is make it more likely insurance companies will reimburse for these drugs, right?

it would make these drugs much more accessible to a broader, you know -- right now you are shelling out $1,000 out of your own pocket for this, but if you can make the case it will improve your cardiovascular health, the insurance companies will pay >> there may not just be a case use that is obesity-related, but if they can show a statistically shown improvement of not having a stroke, then the think something some of these drugs could be going way beyond the target demographic they are going for, and that's why novo and eli lily could do well, and

they could reduce having a heart attack or stroke by 20%, that's a huge deal. >> thank you good morning we went on quite a run, andrew it was quite a run, and now we are in the -- what seems like a pullback, and the question is how far back does the train return where are you on all of this >> we are defensive in our positioning. we gently think across the u.s. markets, i think you are right, we have had an incredible run of markets. it has been great for holders of equities, and that run has been entirely about expansion, and that valuation between the stocks and bonds and with concern that earnings growth

will continue to slow, we see poor risk award for u.s. and european equities here >> across the board, and that means those that play the indexes, you wouldn't do it. are there specific places you do like >> some of the defensive sectors do look more attractive, and we think that yield move has been overdone and we think the yield moves would move modestly slower in the coming months, but i think you have a challenge where rerating has been pretty broad-based and our concerns around earnings pressure are broad-based. we think those are some of the sectors that will outperform >> do you think -- you are a credit guy at this point, you

like bonds >> we do we think the bond market could benefit from a couple of factors. the increased risk premium over expected inflation in the bond market, and the bonds will tend to do well in august and september, and even if the recession is a avoided, the growth status is going to decelerate, and that could help bonds. we don't expect another rate hike in september, and usually investment-grade credit and high-grade bonds do relatively well after the last fed hike >> you said you like europe. we were debating what is going on in italy this morning as it relates to the banks and looks like a massive windfall tax. it's something we have not seen in the united states before, and

is that something that concerns you in parts of italy or europe? >> well, depending on the day, european equities have been up more than the s&p 500, as impressive as that s&p 500 has been, and i think the dominant story and the correct story given how strong the u.s. data has been, that does not apply to the european data. the european data has been much weaker than the u.s. data. the underlying economic data is softer, and you throw in the country's risks like what we saw today out of italy >> thank you for your time under armour just reporting

expecting the full year. the stock is down slightly lower, down a little bit we will ve thahat story. "squawk box" will be right back. you're a rock star. you are a rock star. no more calling co-workers rock stars. look, it's great that you use workday to transform your business. but it still doesn't make you a rock star. so unless you work with an actual rock star. hi, i'm ozwald. hello ozwald. pam, you are a rock- i wasn't going to say it. ♪♪

as the dollar strengthens. let's bring in ceo, mark bristow. it was two cents better than expected great to speak with you. >> good morning. >> from your standpoint, one of the biggest input costs if not the biggest has been energy and that has been up in the past six weeks, so i am wondering what you are seeing on the impacts in your costs >> the costs are flattening off. probably not going down yet, but certainly flattening positive spots are everybody is focusing on greenhouse gas emissions and moving to green energy as we are investing in cheaper energy overall >> okay. so you anticipate your costs to

level off because of that. what are you anticipating in terms of copper prices what we saw this morning is copper prices have moved to a one month low. of course, it is a major consumer of copper is china. >> well, gold or copper, when you look at all the fundamentals for copper, we will be in short supply very, very soon we're still trading almost on a daily basis, you know, the above stocks -- above available stocks are copper are low as miners, one thing i have always said and i have been in the industry for a long time,

it's a long game and you can't manage your business on short-term events, and the copper prices is a short-term issue. >> can you walk us through where the new demand for copper comes from we get a little sniffle out of china and copper prices go down, and copper is the backbone of the new greener energy, and so where is the driver in terms of demand where is that coming from? and does that mean copper -- >> batteries is not a long-term solution for a better planet, and we are greening our grits, and we have seen that with big

cable connections around europe. we have to keep the green or renewable energy to the industrial regions, and to do that you need big cables and the only way you can transport electricity is with copper and the other industrialization and development, we will soon work out that we can make all the cars in california battery-operated, but that's not going to save our planet the way to really protect and leave a better planet for future generations is to develop the underdeveloped economies right now we are all obsessed with strategic metals, but it's all about development. i think the key point i would leave is, you know, gold is precious, and my view is that copper is the most strategic

metal out of all the metals. >> gold may be precious, but it doesn't yield anything, and so what do you think about a bond that will yield you 5% >> well, if you look at bonds going back to 1972, gold is really out performed, and right now we have a situation in the world where there's a question mark over, you know, where the dollar will stand up as the reserve currency into the future it's a store of wealth it's one currency paoliticians, it's their go-to asset, and with the increase of interest rates on the back of inflation, look where it's sitting at the

moment in the last quarter, the average gold price in the last quarter is the highest it has ever been in the quarter >> mark, thank you, and nice to see you. mark bristow coming up, the challenges of making chips on american soil. why is it taking so long to get it out of washington and into the hands of companies we are looking at red arrows the dow is off autbo 225 points. we're coming right back after this ch the game today? (hero fan) uh, yea. i have to watch my neighbors' nfl sunday ticket. (josh allen) it's not your best plan. but you know what is? myplan from verizon. switch now and they'll give you nfl sunday ticket from youtubetv, on them. (hero fan) this plan is amazing! (josh allen) another amazing plan, backing away from here very slowly. (fan #1) that was josh allen. (fan #2) mmhm.

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shares of data dog down sharply after the company reporting an adjustment 30 cents. and the stock is tanking, and it's a drop considering it's about a $34 billion market cap company. today's companies are waiting on government funds to be dispersed, and we are joined

with a progress report, which i imagine is not going to be an a-plus >> it's not going to be an a-plus, but there's construction off the ground you are seeing construction sites like this popping up all over the united states, and the goal is to start and finish chips on american soil some companies have promised, and this equates to revenues on an annual basis. >> the cap x is about 100 prs, so getting the government support to build this technology will be really important >> not all chip companies are the same some have promised to spend billions but put their plans on hold until they get that federal

aid. listen in. >> there's no commercial viable way to get this done without government support, and that's why it was put in place. it operates on thin margins. >> so they are waiting for $53 billion, which is not going to be dispersed all at once but split up in the next five years or so and we are expecting the money to start to be dispersed by the end of the year you have 140 staff members sifting through applications for federal aid in domestic and international companies, and this is not going to happen overnight and companies still need to wait >> what will the chips be used for specifically >> this company in specific,

they grow silicon carbide. it was found on astroids, and this is a little different which is why their trajectory will go up because of the transitions to evs all across the world >> thank you sthaoeuf still to come, roger ferguson joins us. we will break down the quarter on what this stockeaor mns f the largest shipping company you are watching "squawk box." this is cnbc ancial strength and stability. deliver solutions that meet complex needs. do right by customers, clients, and policyholders, always.

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we have an update on a story we told you about earlier. telecom billionaire is changed

the name to dish network in 2008, and so we have the stock here, and dish is down 2.5%. the new data on small business optimism out. kate rogers joins us with that story. good morning >> andrew, good morning. overall the few or qualified applicants and passions, and openings were hard to fill and that is unchanged from june. the second biggest issue is inflation. fewer owners are saying it's a big concern. it's down 3 points from last

month and 13 points lower from the reading a year ago which was the highest since 1979 the group's chief economists is saying the long and predict the recession is nowhere to be seen almost and there's more talk about a soft landing and less about a recession, but millions much consumers will start to repay the student loans rather than paying for goods and services. back over to you >> thanks so much. what is the lending environment right now for owners >> that was a huge focus remember, back in the spring it was harder to get loans with the regional banks struggle, and that has improved. only 6% said their last loan was harder to get than previously, and 4% said it's their top issue, financing, compared to a

quarter that point to inflation or labor as their top challenge. >> thank you we are watching shares of lucid this morning, and the company reporting a loss of 40 cents a share, and that was short of the 175 million analyst expected, and they have enough liquidity to last until 2025 coming up, what can brown do for your portfolio and then a strike looming for automakers wweill talk with former ford ceo, mark fields "squawk box" will be right back. i'm so glad we did this. i'm so glad we did this.

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shares of novo nordisk are up sharply this morning.

joining us now with more on the company, the strategist. great to see you again we were just talking about the select trial yesterday on "fast money. a 20% reduction was way beyond what anybody was expecting what does it mean in terms of reimbursement in your view >> great seeing you, too, melissa. as you said, 20% is well ahead of expectations. it will open up the market to a bigger patient population over time you know, managed care and these insurance companies can kind of get around the cost of prescribing more drugs over the near term for obesity. there's now a long-term large clinical trial that proves that there's a big cardiovascular health benefit for patients staying on the drugs

near term, and also over the long-term, i think the obesity category will be one we will continue to watch. insurance companies are obviously going to have to find a way to carve these drugs into their plans at an affordable price. these are the two main things we are look at this morning >> how soon do we start hearing about reimbursement, and how soon do analyst like yourself start marking up their models to account for the bigger market? >> i think most analyst that cover these stocks have jacked their numbers up pretty high already. i am not sure how much there is to go, but i think with the trial, what it does is substantiate some of the numbers that have been thrown out there in terms of is this a $50 billion market, is it 60 billion or 70 billion? with the resulted this morning from novo, we are finally at the point where we can finally justify some of these numbers. do they move significantly

higher i am not too sure because analysts have been liberal with their assumptions so far i agree with some of them. i do think some of the long-term numbers could be a little aggressive, but we can finally point to some scientific evidence that will substantiate it in terms of when this really starts to come on soon, and eli l lily has not been approved for obesity yet, and people are taking it off label. it's a multi-year game, and i think we are fairly early, and now with the data this morning, it's going to bring these drugs to the forefront over the next couple of years from an investment standpoint as well. >> the great irony, and maybe we can put up pfizer on the screen, and you put up pfizer against eli lilly, and you think about

pfizer with the covid vaccines, and this was supposed to be a great profit machine, and here we are -- there it is. that's a great example of what you are seeing there eli lily outperforming based on the back of the obesity drug and talking about covid, and we used to talk about obesity being related to covid it's afascinating cross kerranc kerrance in all of these >> the duh isparity and al investigation is something i look at every day, and the investors and participants in health care look at this often as well.

eli lilly has been a huge beneficiary of two markets, one being obesity, diabetes and alzheimer's. and companies have looked at pfizer as a company involved in a one-time situation unlikely to repeat at least to the magnitude we saw in 2020 and 2021, and they have spent that money away from these big myergers i think the street has been, you know, mixed, i would say, as far as whether those deals were good or not, and time will tell yes, i think over the long-term you want to potentially start

looking at a pfizer versus a lilly on valuation, but the narrative for most investors now for lily and knovo is much bette than pfizer. >> given the valuation and how much is baked into the stock, and at this point it has raised its guidance and the data, has that been factored into this -- >> i think a lot of that is in here i think, unfortunately, in happy thanksgiving -- health care, which doesn't have that many winners, lilly still kind of stands out with higher quality, and yes, the caution was mainly around, you know, excludeing the

select trial was baking in the evaluation, and novo's numbers today, it's difficult to get negative on it, and a valuation that is exceeding 50 times this year and 40 times next year, yes, versus the pharma peer group, it seems extended but they have a better story to tell than most. >> it's great to get your take this morning thank you. ups, meantime, out with its second quarter results jonathan, great to have you with us weakness in e-commerce, is that the main culprit here? >> that was one of the culprits. the revenue was down 13%, and on

the domestic side, there was uncertainty regarding the teamsters negotiations that went up until the last minute in late july international macro e-commerce, probably a little demand softness in the u.s. and domestic, but that was more specific to ups and what they had to deal with the teamsters negotiations up until two weeks ago. >> do you think you will get clarity over clarity on what that new deal will cost ups? >> ups pushed their earnings back two weeks to get the deal passed the finish line the local teamsters leaders voted in favor of the deal, so seems like it should be done however, you never know. ups has to be a little guarded with how they portray this deal and how they talk about pricing

and how they talk about getting share back any of the positive information -- >> is there a possibility of a strike >> i don't think so. it's never done until it's done. 161-61 is a good consensus, but you never know until the final vote is in >> in terms of ups versus fedex, how do they look >> they are falling into sympathy, which is not too unexpected you have the labor negotiation with ups, which was a distraction, and fedex is working through cost restructuring after they talked about restructuring and merging the ground and express businesses there's a lot of costs fedex can

take out of the business the real benefit for fedex is ups will have to raise prices to offset a lot of the labor inflation. what we are hearing in the market late last week is they are going to customers talking about high double digit price increases, and if that happens fedex is perfectly positioned to ride the coattails and move their price up at a similar magnitude and have their costs moving in the same direction, so it's a beneficial outlook for fedex. >> what is your top question for that call? >> i would like to know what the sustainable margins look like going forward. they beat in the second quarter, skp and you have to take that into consideration. the question is going to be as you integrate the new teamsters

contract that is higher in year one and is tempered a little bit but above 10 and core inflation years two through five, what is the pricing outlook going to be and can you get back to the margins you had in the recent past to win back some of the share you lost during the period of uncertainty >> ups shares down 5% right now. thank you so much. >> thanks, melissa coming up, where things stand with the contract negotiations, the former ceo of ford will join us. stay tuned

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welcome back to "squawk box. shares of omni plunging. they are off about 14% what you are seeing now is they missed in a whole punch of ways. revenue estimate missing, and the company cutting its revenue forecast, and it's showing no signs of recovery. the company said high inflation, rising interest rates and inflation fears contribute to the soft demand, and struggling with the perception its products are unhealthy and overly processed and is releasing an ad campaign that says it will try and change that perception

some people think beyond meat is healthier, but it's not because of all the compounds >> yeah, it doesn't happen naturally. >> there you go. >> and we also take a look at palantir i should say it's off about 2.5%, but before it was up because the results came in, and the current quarter revenue forecast coming in higher than expected, and there was a letter to the shareholders that said they expect a fourth quarter of straight profitability, and the current quarter making up to $1

billion in repurchases, and it has been on a tear this year, up more than 180% a potential strike could be looming over the big three the big contract representing about 150,000 employees and joining us now for more on the negotiations, mark fields, a former ford motor company president, and it's always great to have mark here because he has been the man in the middle of negotiations just like this. what do you think the state of play is and what do you think will happen? >> the state of play is, first off, you have a very different set of negotiations in terms of the environment. you have a new uaw leadership that was transparently or directly elected by the rank and file, and you have a leader that wants to make a mark on the detroit three. you also have a transition, a

once in a lifetime transition that will be tricky for the industry you have the uaw who has made some -- let's just say, realistic demands, and the leader calls them audaciou and judicious. there's some interesting things in there, some wacky things in there, but they're starting the negotiations now the contract is up on september 14th and listen, at the end of the day, there's a lot of things the uaw is asking for, but i think the union will focus on getting wage increases, they'll focus on some kind of job cutters, and also some kind of transition to evs, particularly for organizing some of the joint venture battery plans that are here and in the u.s and i think that's what they're going to focus on, andrew. >> mark, how does this compare we keep talking about the hollywood strike, which has now gone on for quite some time with the writers, of course, and now the actors, could you imagine a

picket line for a very long time, or no? >> well, listen, this new union leadership is doing things very, very differently traditionally, you pick a strike target they may do that, they may not they may, you know, if they're not getting what they feel they should and the new uaw leader wants to show he's fighting for his members, they may shut down a key supplier, which could shut down the plant but if we get to some kind of strike, that's going to be good for no one, right? and i think the only reason a strike would occur is if, you know, the union really pushes demands, some of those demands, for example, are they want to reinstate defined pension. that would add billions to the cost structure of the automakers and they will push back very hard on that and if they go to a strike, you know, that will, it will be interesting, because it has a huge impact on the economy

the biden administration is going to get interested in that, because it's the run-up to a presidential election. but at the end of the day, if the oems are actually forced through a strike to add some of these structural costs, they're just going to be forced to, you know, take some of their products and move it to places like mexico and then the uaw membership >> what do you think the lesson -- we're now 15 years on from the financial crisis. but the lesson of the failure of general motors during that period, and just the challenge and struggle that so many of the other detroit automakers went through, as it relates to the way the union thinks about these things today >> well, if you look at their demands, it's literally, they want to claw back literally all the benefits they have prior to the bankruptcy of gm and chrysler it's almost going back to the 20th century benefit we've had we live in a very different world now. the detroit three have about 40%

of the market share in the u.s., where they used to have about 60 and there's many more competitors now, andrew, particularly on the ev side. and so, you know, it's going to be -- it's quite a different world now, but, you know, i think on the automakers side, there is no appetite, zero appetite to add some of these structural costs like pension and health care benefit improvements and things of that nature because many of the leaders that are sitting in the c-suites right now in the detroit three lived through the great depression and some of them lived through the bankruptcies at gm and chrysler and they don't want to go back there. because that was the lesson learned. that old saying, history doesn't repeat itself, but it often rhymes and if we go pack to some of these benefits, you could see that happen sometime in the future if the oems are not competitive versus, you know, they're foreign-owned non-union competitors and tesla, which have a lower all-in wage rate.

>> before you go, pause you did mention tesla, and i am curious, i don't know if you saw the tesla ceo stepping down, no explanation that has been made truly public do you have any thoughts about the impact of that >> it's always really odd when a cfo steps down in the middle of a quarter and gives no explanation. it's really unusual. listen, they have a pretty good bench. the person who they're installing as the cfo was previously at solar city, and when they came over to tesla, when they acquired solar city with the controller, and now with their chief accounting officer. so clearly musk is comfortable with this individual but i think it does reignite issues around succession planning for musk, because the previous cfo was mentioned as a candidate. and a question, are you going to see a round of a lot of

management instability, because it's been pretty stable the last couple of years, but before that, there was quite a bit of turnover >> always good to see you to get your perspective on all of it. >> thank you >> thanks, andrew. >> shares of amc entertainment are higher this morning by about 4% the company reporting an earnings per share of one penny. i guess that's good enough to get the shares higher. coming up, congresswoman mikey sherrill will join us to talk u.s./china relations ahead of the one-year anniversary of the chips and science act. and former u.s. president david malpass. stay tuned "squawk box" will be right back.

good morning red across the board this morning when it comes to futures. yesterday, the dow had its best day if well over a month, but right away, it's set to give back a big chunk of those gains. earnings in focus today. market names include u.p.s. and eli lilly. we're tracking moves across big pharma and media and a major telecom deal charliergan merging satellite with echostar.

final details on that straight ahead as the final hour of "squawk box" begins right now. good morning welcome back to "squawk box" right here on cnbc we're live at the nasdaq market site in times square i'm andrew ross sorkin along with melissa lee joe and becky are off today, but that's not stopping all of this news take a look at u.s. equity futures this hour, because unfortunately, some red this morning. 225 points down. it looks like we would open off the dow. nasdaq to open down about 115 points the s&p 500 looking to open about 32 points down treasury yields, right now you're looking at the ten-year note it's four, flat. never get to say that. and the two-year at 4.739. >> southcom billionaire charlie

errgan is merging dish and echostar after the combination, eckstar will survive as a wholly owned unit of dish errgan controls both companies he co-founded echostar in 1980, changed the name to dish network, and spun it you have a from its arm eckstar do not miss david faber's exclusive interview with david errgan in the 10:00 a.m. hour of "squawk on the street. we have al full slate of earnings out this morning. let's get to dom chu for all the highlights >> a big earnings mover of an economic bellwether. that's u.p.s the shipping and logistics giant is falling to the tune of just around 5%, around 30% of pre-market volume. revenues came up short, due in part to softening demand for ecommerce deliveries if you couple that with the heightened cost associated with the new labor agreement, it's

signed with the teamsters union. u.p.s. is now cutting its full-year revenue and operating margins outlook. u.p.s. is down about 5%. competitor fedex also down down about 2%. and the dow jones' transportation etf is off about 1%, as well. then there's a couple of pharma/health care-related movers both have ties to the surge in the popularity of anti-obesity drugs. we'll start with the earnings around eli lilly, which is up around 8%, around 360,000 shares of volume. the drug maker handily topped estimates for revenue, thanks in large part to key drug franchises like its diabetes treatments also its anti-immune disease treatments for mounjaro, it's about the potential it has an as an anti-obesity treatment it's still in the approval process for that eli lilly up 8%.

in the same vacein, check out what's happening withvo nor nordisk. it said a late-stage trial of its wegovy obesity treatment that it reduced someone having a major cardiovascular event like a stroke by around 20% that is prompting some investors to look at the potential expanded future use case for that drug. both novo and eli lilly yb they've been powered by a lot of the optimism around anti-obesity drugs and their future potential revenue growth trajectories. melissa, a lot of names in the news back over to you >> thanks, dom chu fox corp. just reporting results. earnings coming in at an adjusted 82 cents per share. in line with estimates, flid snow you, but we will follow

that meantime, let's talk about the broader markets, with futures pointing to a pullback after yesterday's rally. joining us is i-capital chief investment strategist, anastasia omarosa. what's your take on where we are now? we're much through earnings season, but valuations are high. >> valuations are high, but earnings season was a good one we have seen more companies beat than typical on average in the last ten years, and serene them beat by a greater amount as a result, we didn't end up with a negative 9% earnings number, but with 5.2% so far i think that is positive i do agree with you. if you look at valuations for semiconductors, they have expanded so much, they have essentially doubled since the track we were on in october of 2022 and i couple that with some of the positioning. much length has been added, whether it's the systemic community, the hedge fund community. i worry that this set-up is now

sort of precarious going into what is typically a very, you know, illiquid month of august so you have to wonder, what is the catalyst likely to be to kind of make protracted pullbacks. and i think it's yield 4% more now. it's higher. i think it's worries about the issuance that are upcoming in u.s. treasury coupons. and i do thinkit might be some fears that inflation may actually rise more than people expect >> yeah. it won't look like a straight line lower as we've seen year on year, because of the comparisons are more difficult at this point, anastasia but going back to sort of the positioning and adding length, you mean that at one point, everybody had been on one side, thinking that the worst was going to be ahead of us in terms of a recession, a market pull pac. we saw the markets climb, climb, climb, climb, that so-called wall of worry. and then people started saying, you know what, maybe we won't have that recession, maybe we should get more bullish. that chase now is on

>> that chase is fully on. now seeing a lot of the economists capitulate, there's going to be no recession, and soft landing is the consensus. and once that becomes the case, that's when you start to worry what's also the consensus that inflation will continue to tick down, until we eventually hit 2 to 2.5%. if you look at the monthly change of cpi inflation. if you forecast that out, let's say cpi comes in at 0.2% month over month, we might see a slight tick higher in year over year inflation so i worry that the markets are going to start to worry about that and that right now is not consensus. because everybody expects, you know, a smooth disinflationary trajectory >> we're also seeing a rollover of the leaders in the market if you take a look at apple, each stock is down about 10% is that -- you're losing -- it seems like we're losing leadership at this point >> yeah, i mean, look, if you

look at the price action yesterday, it seems that's where people flock to once again, but they flock to the other parts of the market as well i think there's something to that if we are going to be going into an environment where ten years, it's going to stay at 4% or maybe go even higher, especially as we've seen more and more treasury coupon issuance, that's not a great environment for tech valuation. and so i think for investors, it's sort of been an easy year you have some cash and you have a lot of tech. and if you do, you've had a pretty strong return on your portfolio. but i don't think it's going to be as easy going forward and it's not just about having tech, but i think it's having some of the sectors that once again can benefit, if yields are higher and if inflation is higher and by that, i mean financials and i also mean energy >> does it worry you, the moodies downgrade of the banks or no? >> some of the weaker ones had to be downgraded but if i look at some of the stronger banks there's the fortress balance sheets, but also lending that is

in check net charge-offs that are still in check and there's a soft landing. by the way, there's a yield curve re-steepening. if we worry about this sharply inverted yield curve being so negative and a ten-year falling zp depressing income, that's reversed and then there's the potential for the capital market activity to rebound, which benefits the large banks. >> what is your bond portfolio -- what does that look like in terms of the mix that you would recommend to investors? >> i would focus on some of the spread product and, you know, of course, spreads have tightened in high yields and investment grade. but i would still look at some of those opportunities because the supply has shrunk of a lot of those bonds the supply dynamic are favorable and investors are in a risk-takinging move. they will stay long some of those. but i would say 5 to 8% yield to risk doesn't sound like all that great in today's environment but that's why i would recommend nervouses look at private credit because private credit, mostly floating rate and some of the

coupons are 10, 11, maybe 12% or higher depending on the product. i would barbell some cash, some high-yield, maybe some investment grade, but certainly private credit >> great color >> yeah. fantastic. >> you should try it some time >> i'm -- with a tie or just the whole -- >> the whole -- go for it! coming up, former world president david malpass responding to fitch's united states downgrade he says the dollar is in danger. we'll talk to him in a wrap-up of some big media earnings that investors are just starting to digest paramount's sale odionf amd shuster and those new results from fox stay tuned you're watching "squawk. ing! they collect hundreds of data points like hrv and rem sleep, so you know all you need for recovery. and you are? i'm an investor...in invesco qqq, a fund that gives me access to... nasdaq 100 innovations like... wearable training optimization tech. uh, how long are you... i'm done.

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weakness this morning in semiconductors with nvidia down about 1.2% we're seeing ten-year yield go below 4% just at 4% even just a few minutes ago, the two-year is at 4.73%. coming up, president biden expected to order more scrutiny of u.s. investment in chinese technology, possibly as soon as this week. ahead of that, we'll speak with a key member of the house select committee on china plus, former world bank president david malpass joins us on the implications of fitch's u.s. credit downgrade. stay tuned you're watching "squawk box" on cnbc

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look at that beautiful shot of the capital we don't have weather like that in new york. meantime, we have breaking comments from the head of the philadelphia fed straight over to steve liesman with more on that, steve >> thanks very much, andrew. philadelphia fed president patrick harker is saying at this time that we may be at the point, as in the federal reserve at the point, where we can be patient and hold rates steady. certainly, that's true for the upcoming meeting in september. but he says the fed will hold

rates steady for a while, once it gets to that point of holding them steady. he does not see circumstances for an immediate easing of rates. we sees the economy headed towards a likely soft landing. he said, we are making progress against inflation. he goes on to say that the -- hang on, just looking here yes, he sees inflation returning to 2% by 2025. it steps down, 4% this year. 3% next year, and back to 2 by 2025 growth, he says, will slow, he expects. unemployment will pick up, but only a modest slowdown is forecast he focused on the resumption of student loan payments and the potential economic impact, especially in light of what he's seeing in credit card balances and the increases there, and loan delinquency rates i'll leave it there to tell you that the market is trading about a 15% probability of a september rate hike and a 30% probability of one in november the market has never, as far as

i can tell, put anything near a 50% probability or higher of that november rate hike. so even while most fed officials have it penciled in, the market has not. >> fair enough, steve. thank you. appreciate that report very much meantime, with another report to tell you about, because president biden is soon expected to sign the american order that would have investments in high tech it's expected to target venture capital. joining us now is congresswoman mikey sherrill of new jersey between the u.s. and china there's been a lot of debate about this one >> there certainly has been. i think there's also been a lot of work with private industry to make sure that this will be very targeted and make sure what we're doing the reporting from our

companies, where the investments are going, and if key targeted areas, stopping the investment in some of this high-end technology we've seen and this is based on some of the investigations that the special committee has done, we've seen, for example, some u.s. investment going into shin zen, where a genocide is taking place against the uighur people. we've seen some u.s. investment going into the suppliers of the people's liberation army, into some stealth technology. so there are those key national security areas that -- key areas that we want to make sure we're protecting u.s. investment and protecting u.s. industry >> congresswoman, what is your sense. i don't know where you put this one. tiktok is owned by, as you know, a whole bunch of private equity firms in the united states what would you do about something like that? >> i think what we see with tiktok and in so many areas,

that we just have seen unfair competition. so the special committee has heard testimony from u.s. tech firms about how, for example, all of our market is open to groups like tiktok, and jet chinese markets are not open and what that creates is this imbalance where tiktok and their parent company can earn billions of dollars in the chinese markets, which they can then dump into taking over the u.s. mark so we hear from our u.s. technology companies look, we can compete with anyone fairly we're the best in the world. the problem is this unfair competition. and so we want to see more parody and fairness in the market >> and do you believe by implementing this, i mean, how much of this is an effort to change the policy in china versus really change the policy in the u.s.? >> i don't think we're going to see a policy change in china we see a marxist economy

we've seen very clearly how china has not become more democratic they've not embraced the rules of the world economy, that the united states has been instrumental in setting up in fact, they are now a threat to the rules-based economic order. they have been creatinge ing ths unfair playing field, which is why we're reshoring so much of the american manufacturing economy. i don't think they're going to change their policies. they've been pretty clear in the china 2025 policy that they intend to compete in certain areas, and they intend to do so with investment in chinese research and development, but they also would like to do so by having u.s. companies come to china and then the chinese taking their technology, taking u.s. technology, and utilizing it to overwhelm the u.s. companies. that's what they've been doing they stated, that's what they

intend to keep doing we're going to take measures to ensure that we can create a more level playing field for their companies. >> what kind of private equity have you gotten from the world disclosures have been an issues they've typically fought >> it's been very interesting, because i always anticipate a lot of pushback when there are these changes. because we have companies that want to make sure that they're doing as well as can be expected in their investments and making money for their firms, but what's been interesting to me is to see that even pfr much of this -- we haven't seen what the administration is going to put out or when they're going to put this out, but we've already seen withdraw of much of the american investment and i think that's because after the zero-covid policy, after the

wolf warriors, after taking over a large part of different industries, we've seen china become a risky investment. it is to many of our venture capitalists, china no longer looks like such a great investment we've seen companies moving out of china because they can't ensure their supply chains respect using forced labor we've seen supply companies moving out because they can't ensure that their technology won't be stolen. so a lot of this has been something that i think our investors are already pulling out of china and making different decisions, without some of what the biden administration may come forward with >> you mentioned the chips act it is the one-year anniversary we have a reporter out there who covers the chip sector and says it's taken a long time for any of that money, the $53 billion to get into the hands of

a company to actually break ground and some of these ceos cannot break ground until they get these checks this is how long it takes, the bureaucracy that's going on, or doug do you -- would you have thought that we would have been further along in terms of this effort to reshore. >> this is a complicated process and we want to make sure that we are putting out regulations so we are not simply, you know, the united states government isn't a venture capitalist we need to care for the taxpayer dollars that we utilize and make sure they're used wisely that said, certainly there are frustrations with some of the bureaucracy. i think we'll need permitting reform, not just for the chip performers, with the investment we want to do and as quickly as we want the move however, i will say there's a lot of good news here. because even with some of these

hurdles to clear, we've already seen, i think, it's 400 statements of interest people -- companies that are interested in applying for this. we've already seen $231 billion of private investment into chip manufacturing. and we've seen an 80% rise overall in manufacturing construction year over year, which is really shocking so we're seeing the force of the government's push to reshore american manufacturing and to create these jobs here at home >> okay. congressman, we appreciate your time this morning. thank you. >> thank you so much >> you bet meantime, shares of amc entertainment higher the company reported earnings of a penny per share. the street was expecting a 4 cent loss. it's the first per-share profit since 2019 revenue coming in at 1.3 billion. amc logged its highest monthly

sales figures last month driven by "barbie," "oppenheimer," and the latest "mission: impossible" movie. what do you make of this >> there's always hope but for the meme community, there are die-hards that are still on the stock, but other stocks that have become the so-called meme stocks. we talked about tupperware very small market. we've seen staggering increases. >> are you a believer that they can actually get their debt and their house in order effectively? that's the fundamental question. it's almost, can you outlive the debt and be able to pay enough, pay the monthly payments, how many shares do you have to issue, what do you have to do? how do you get the shareholders to play ball >> you know as well as i do, i have no opinion on that specifically >> it's a challenging one. that is the big question shares of beyond meat plunging, a loss of 83 cents a share. revenue of $102 million fell

short of the $108 million estimate the company also cut its full-year revenue forecast, the slowing demand has shown no signs of recovery. the company said high inflation, rising rates, and recession fears contributed to the soft demand the company is struggling with the perception that its products are unhealthy and overly processed. the stock is down 16%. up next, breaking data on the u.s. trade deficit, plus former world bank president david malpass. you're watching "squawk box" on cnbc i'm also a library board trustee, a mother of two, and a grandmother of two. basically, i thought that my memory wasn't as good as it had been. i needed all the help i could get. i saw the commercials for prevagen. i started taking it. and it helped! i noticed my memory was better. there was definite improvement. i've been taking prevagen for a little over five years. prevagen. at stores everywhere without a prescription.

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welcome back to "squawk box" right here on cnbc we are just seconds away now from an update on the u.s. trade deficit. take a look at the futures it does look like we've got red arrows dow off about 245 points this morning. nasdaq looking to open down as well 116 appoint points off let's show you the ten-year note i have forgotten to enjoy just saying 4, but now i can't say 4 anymore on the ten-year. the ten-year was literally 4, not 4. -- now it's 3.988 and a two-year of 3.799.

i want to get over to our good friend, rick santelli, who is standing by in person at the cme in chicago no zoom for him. good morning to you, rick. >> good morning, andrew. we have had some wild times in treasuries in the last 24 hours. we have seen that rates have dropped across the globe whether you're looking at bunds, big drops, gilts in the uk, or our treasuries, one-month lows and two-year and ten-year based on where we're trading to close at these levels. trade balance out for the month of june, expected to be around $65 billion, of course with a minus sign, a deficit, comes in darned close minus $65.5 billion. and if we look at the set-up, it's important to go back to march, when it was minus $60 billion. that was the lowest going back to september of 2020 this isn't at that extreme, but it's very close. and it does underscore some of the news of the day. if you look at china exports, we

learned they were at the weakest level in terms of percentage of exports, the economic numbers, the juan value since march of 2020 and if you look at business confidence in the u.s., it was quite strong this morning. we see yields going down, equities, of course, it's a risk-off sort of session at the moment pay particularly close attention to the 385, below the market in 10s. should we close below that level before we close above 4.25, which was the cycle high yield, close from october of last year. i would say that it really double, triple cements that high yield as in place. we know that the 5%, 507 and two-yearsis unchallenged that was established in march. we tried to take it out about three weeks ago and that failure really did set up the big steepening of the yield curve, as two-year note yields hung quite tough and started to drift

lower while the rest of the curve yields moved higher. that chapter seems to have ended. we still have post-sale inventories at auks this week, but at the end of the day, that 4%, andrew, you're right, big psychological level. melissa lee, back to you >> rick santelli, thank you. in a "wall street journal" op-ed, david malpass says that the u.s. credit down dpgrade frm ratings agency fitch equates to a wake-up call we are experiencing a slow-motion fiscal train wreck, not a soft landing and it's straining global capital and endangering the dollar david malpass joins us this morning. good to have you with us >> good to be with you, melissa. >> a lot of people want to write off the fitch downgrade, saying basically they're just matching s&p back in 2011 so in your view, what has become more urgent now? >> the growth in the economy is

the key question you have all of this debt that the government took on quite a bit of it is short rate, because the government was buying back the long rate. when you look at who's exposed in this rising rate environment, it's unusually -- it's biased towards the u.s. government and the taxpayer being exposed that's the same in japan and in europe so there's, i think, more shoes to drop in terms of asset repricing, and of course, global growth is too weak for developing countries >> when you say asset repricing, what specifically are you pointing to? >> everywhere you look, in today's "wall street journal" is the idea of apartment buildings, multi-family andrew just in the last segment was talking about as mortgages come up, there has to be repricing. in the uk, people have floating rate mortgages, adjustable rates that have to be -- that once they expire, you have to take out the new debt at a new price.

that hasn't even started in japan yet. so more shoes to drop, as people reprice. and of course, the u.s. government is one of the big debtors within this process, so that was the point of the "wall street journal" article. >> right so repricing mainly because of the rise in rates that we would theoretically city but there are a lot of other factors in play as well. there are technical factors like the treasury refunding, which is, you know, working its way through the markets now. it's what the bank of japan is doing that's making, you know, japanese investors maybe think twice about investing in u.s. assets i mean, how do you think about separating these factors from the fitch impact >> markets are really good at arbitrage. so they look ahead so i think they'll be able to handle the refunding that was a mountain out of a mole hill. when the debt limit went up, people said, well, there were going to be too many t-pills issued the market is good at absorbing

that i'm more worried about the misallocation of capital you had ten years of interest rates artificially low and bond yields allow that means a lot of things that were bought during that period of time were mispriced people were buying at the top of the market because they could make the monthly payments. but now if the monthly payments go up, they wish they hadn't spent so much. that includes companies. if you were issuing bonds and buying back your equity, that worked until you find out that you don't have a revenue stream or an income stream to support that debt. >> david, the administration obviously criticized the fitch decision, in large part, said that if they were going to -- if they were doing to downgrade, should have done so when the debt ceiling was on the table. maybe should have done so two, three years ago, maybe even four years ago, during the trump administration, when if you look at their model in that chart, it

looked like it was actually at its lowest point it looked like it was coming back do you have any questions about the timing of it now >> i'm not so focused on the bond rating agency cbo put out their long-term forecast so i think really, the important point is what's the deficit going to be this year, next year, and the following, and over the next ten years. the government hasn't really prepared for the funding needed for the aging society and also, for the military you know, we banked year-after-year, decade -- well, many years, the peace dividend that means underfunding of the ammunition and so on and now trying to fight a very long-term war in ukraine, it's using up the resources that are there. so i'm more focused on the need for much faster growth and stronger external profile of the united states in a world that's very chaotic

>> i'm curious, in terms of your view of repricing of assets that needs to take place still, did you have that view at the beginning of the year? because some would argue that a lot of nose those factors were in place so is the fitch downgrade adding to that scenario or is it an actual catalyst? >> i don't -- i think it was already there. and if you think about it, it was -- it's very odd that the u.s. government wasn't issuing long and, in fact, the opposite of what was done we had the odd situation of issuing longs, and then having the fed buy back the longs you should have been issuie ing longs in net terms, meaning going the opposite way from what we did and so that leaves the government exposed and maybe the fitch is just signaling that and catching up with the reality that the u.s. government is

overexposed, was it's also japan and europe look at the carry trade coming from japan they still have their -- andrew has been talking about the short-term rates they're negative in japan. so that has to catch up to some kind of global arbitrage switzerland's currency is getting stronger, and i'm worried about the dollar because of all the fiscal burden that's still left on the u.s. and the world. >> david, great speaking with you, thank you david malpass. >> good to see you coming up, a lot more on "squawk. media results in focus as we get into a big week for earnings we'll talk numbers with rich greenfield but as we head to a break, a reminder, you can get the best of "squawk box" on your favorite podcast. 'rcongig bk. ♪ the thought of getting screened ♪ ♪ for colon cancer made me queasy. ♪ ♪ but now i've found a way that's right for me. ♪ ♪ feels more easy. ♪ ♪ my doc and i agreed. ♪ ♪ i pick the time. ♪ ♪ today's a good day. ♪ ♪ i screened with cologuard and did it my way! ♪

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welcome back to "squawk box. take a look at futures right now, in the red, as we get a whole bunch of earnings coming in this morning. dow off about 100 to 255 points. the s&p 500 off 32 points. let's talk about health care shares of novo, nor disc soaring this morning the danish drugmaker saying its anti-obesity drug, is it wegovy, it's exceeding expectations. in an important late-stage trial, with the ability to reduce the risk of a major cardiovascular related event joining us right now is

fernandez management director and pharma analyst at guggenheim partners we've been talking all morning about novo, we've been talking about eli lilly. these drugs seem to be having a big impact the question is whether you think the stocks have moved too far already. >> it's a super exciting data set. the dynamics, like what you're seeing today, are a little bit of a mix of skepticism heading into this data some fear that we wouldn't see quite as dramatic a result, as we did, but a 20% benefit on cardiovascular events is pretty extraordinary results for the trial. novo was hopeful that they would show 17%, but to see 20%, i think, even exceeded their expectations so i think the positive surprise here is quite meaningful when you also think about the holdbacks, just very quickly, you got reimbursements that need to be settled, and there's a lot

of pushback on these drugs being reimbursed so this is definitely a big step in the right direction >> what is your sense of the price of this stock. we're at 182 bucks right now. >> the fact of the matter is, if you're talking about 150 million potential patients in the united states that actually could be treated, with overweight or obesity, given the actual nature of the trial, you can get to some pretty extraordinary numbers, so just from a revenue perspective, we're forecasting that the market for obesity is going to be $90, just for the bmi plus 30 plus patient population if you expand that to include the patients down to 27 bmi, so overweight patient population, that would further expand the population by another 30 to 40%. so, you know, i think the big question now is, can these

companies supply the market, given the extraordinary demand that we're seeing out there right now, just because we know that they're very difficult for patients to get. >> amgen as well as pfizer are developing anti-obesity drugs, so can we sort of extrapolate these results to the drugs that are developing as well, or is it way too early? >> i would argue that, you know, glp-1-based products in general are likely to see the similar type of benefits there are other small companies that are also developing product, you know, in the space, as well. but, you know, amgen's products is a little bit different. they do target glp-1, but also, they are an antagonist of glip, very different from eli lilly's mounjaro, so we need to see what that mechanism does over time. if the benefits are driven by

weight loss or almost exclusively by weight loss, when you use a glp-1-based product, i think this can certainly be applied to the overall glp-1 category fairly broadly. >> okay, seamus, we appreciate you joining us on short notice, given the news this morning. thank you. >> thanks so much. take care. media giant fox out with fourth quarter results a short time ago earnings beat estimates in line. the company authorized $7 billion in share buybacks. we're paying close attention to par mount global of that company beat analyst expectations in its l latest quarter and agreed to sell simon and shuster for $1.6 billion. joining us for this and more, rich greenfield. we have a lot to get through do either of these results impute on to disney, which we are expecting a little bit later? >> look, i think in some way, they do, melissa if you think about what you heard from paramount, they're selling one of their most stable

solid assets they're selling simon and shuster. not a growth business, but it's a solid, stable, growth business and they're doing it to de-lever, because the balance sheet at paramount was under pressure, and i think you're seeing a lot of media companies, warner brothers, discovery, has led the charge on deleveraging paramounting selling assets to de-lever if you look at what bob iger sort of faces, he came on cnbc, what i think as one of the most amazing or interesting improves with david faber a few weeks ago now, there's a lot of strategic challenges facing bob iger what is he doing with abc and fx who's buying -- who wants to own those assets right now who's investing in espn to help them take it direct to consumer? when is he buying hulu from your parent company, comcast? there are so many big, strategic p issues facing disney right now, not to mention the fact that all of their content hasn't been working.

week after week, you're seeing movies fail. there's a lot of strategic challenges and i wouldn't be surprised to see one of iger's focuses tomorrow on the call to be sort of helping investors understand the time train of how he's thinking about getting the company to be smaller and more focus around their core competencies >> are you suggesting -- would you prefer to own disney or prefer to own paramount, for example? >> this whole sector is pretty challenged i think investors right now, i think there's been some excitement over asset sales, and i think with paramount, and even with warner brothers discovery, you saw great free cash flow numbers out of david zaslav and team last week at warner brothers that helped get the stock up over the few days after earnings i think you were seeing yesterday with paramount global, people are sort of playing the deleveraging theme right now, more than they like the core fundamentals of the sector you know, even with comcast, i think there's increasing hope that maybe there's a transaction

in the future, and what will happen consolidation is clearly necessary. you're seeing the ad market -- the tv ad market, every single company, andrew, two, three quarters ago, everyone said, oh, it's weak right now. the recession will pass. the recession fears will pass and it will get better in the second half. we didn't have a recession and tv advertising is still terrible the only sort of notable outlier in tv advertising is fox, which is definitely doing better than the peer group but tv advertising overall has been pretty terrible and so you add in cord cutting plus weak tv advertising and every single company is facing a secular decline in their linear tv business, and streaming is still losing billions. i think the end result of that is everyone is now thinking consolidation is going to happen over the next, you know, call it 12 to 24 months. and so everyone is starting to think about what are the pieces you would want to own, not because you love these businesses fundamentally, but because consolidation is possible, and clearly, you heard sort of that same drum beat from

iger in that faber interview >> hey, rich, we also are hearing reports that max, discovery, this is warner media's max, is thinking about a second sports tier that might exist on top of max. what is your sense of the possibility of that and the possibility that other streamers might try to do a similar type of thing >> they have the right to do it. if you look at the warner brothers discovery deals with the leagues right now, they have the ability to have an extra tier and look, you've seen, you know, peacock has put sports rights that are on linear tv, like the nfl airs on both you've seen that from multiple companies. cbs does the same thing with paramount plus >> i think we're talking about premium tier i think we're talking about a premium tier >> we are, which no one has -- no one -- people have done it for free, or, you know, included in the biase, no one's done an actual premium tier. i think it's a relatively small

business i don't think there will be a lot of people who say, i want national north koreba games on max subscription that i'm already paying $15/month for i think that's a small business. does it begin to sports people will pay incrementally for it's probably a good learning exercise, but i wouldn't expect it to be a big business. the interesting thing for your viewers is, from what we understand, they have the right to do it today they could have done this for years. they just never wanted to. they've had the ability for years to offer this product. >> the entire industry is deleveraging, rich who is going to be doing the buying if everybody wants to improve their balance sheet or a lot of people have debt loads, right? how are you thinking ab the buyers and the sellers >> melissa -- you're smiling and laughing so are we. who is all the buyers? who wants to own abc and fx?

bob iger just told you we can't fix it, it's fixing secular headwinds, please come buy from us that's not exactly the most compelling sales pitch you've heard. you can look at tpg, a private equity firm bought directv and i think they've had a great return on that asset. you saw private equity buying into simon and schuster yesterday. that's not an asset. simon and shuser is a book business, relatively stable and growing. buying an asset under secular headwind and seeing a real decline, that's a much tougher idea i think the challenge is we don't know who is buying these sort of underperforming or weaker assets. they want to sell them who is going to be the buyer are these fire sale prices to private equity i don't know it's a great question, melissa. >> a pretty grim outlook, rich

there's nobody to buy this stuff, it creates a problem. who is in the best position right now at this time when the industry is undergoing some retrenchment >> look at disney's stock. when was the last time you saw ziz anystock in the mid 80s. it's been a long time, melissa it's been a very, very long time since you've seen this kind of pressure on the walt disney company. look, the company that's in the best position right now, you can look beyond the sector who is benefiting from advertising trends right new companies like meta, 20% plus growth netflix, as everybody is bat tenning down the hatches in linear, netflix is rj chaing forward and strengthening. that's why you're seeing the stock reach new 52-week highs over the last few months there's a renewed enthusiasm around streaming for netflix with less competition.

did they crush the quarter no revenue was not as good as expected they are certainly benefiting from everybody else pulling back rich, always good to speak to you. thank you. >> thanks, melissa. coming up, what to watch ahead of the opening bell on wall street. s&p looking to give up 29 points this is way off the session lows premarket. dow losing 237, nasdaq looking to be down by 100. stay tuned you're watching "squawk box" on cnbc rience. 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. and just might change how you trade—forever. because once you experience thinkorswim® by td ameritrade ♪♪♪ there's no going back. (vo) sail through the heart of historic cities and unforgettable scenery with viking.

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market set for a pullback after yesterday's gains. joining us is the portfolio manager and senior research analyst at cane anderson rhett nick after what was a good day yesterday, we have a tough week the prior week boy, before that, we were on a nice little run. what do you make of it >> i think generally speaking, this is not fomo i think people feel like they're forced into the market many people missed out on the rally surrounding by ia. they're having to get risk on. they recognize the fundamentals of a lot of these businesses aren't great and that the economic outlook is pretty

uncertain. so i think that's why you get these violent pullbacks where suddenly there's a flight to quality and people get nervous there's not a ton of conviction out there. people are cynically invested. i think that's why you get such gyrations in the market. >> i hear you. i think there's a larger question which is, did we go on a run that's now going to have a genuine pullback do we go back to where we were before are we in a new bull market? what is this we've had a divergence of opinions there >> i think what's interesting to me is you can make a case for any kind of economy you want, even between the labor market data, depending on what you choose i think part of what we're seeing is the impact of mix. if you look at income growth, the income growth moving the fastest has been the low-income consumer versus the higher end consumer if you say, well, we have in

glut of savings, yeah, that's true most is held by the richest 1% the propensity to spend there is lower. it's a really mixed outcome. i think what's important about trying to decide the direction of the economy is to be focused on the quality of the businesses you invest in. i do think that's where you're seeing some differentiation even among companies competing directly against each other. >> we've got about a minute, julie. i want to ask you about today's session in particular. we're seeing extreme weakness in software name, igb down. do you think there's a lot more of that to play out? >> the multiples that we've seen have been pretty extreme relative to what the earnings outlook is i understand ai has a lot of potential. that's way out into the future so we're back to this case where narrative is what's driving mul multiples. that's just not sustainable over

the long term. you have to have fundamental growth in order to support these high valuations. there's potential risk when you've got things this expensive. >> what do you think about pharma a big move this morning between eli lilly and novo by the way, how pfizer hasn't moved in the same direction, they don't have one of these drugs. multiples too high, too low? >> i think it just depends on what you're talking about in pharma you look at word that wah gove have is cutting down there's so much innovation happening in pharma, and the potential for these blockbuster drugs is material. i would rather be kind of the picks and shovels, so west pharmaceuticals that does the direct injector, that's better play for me. >> julie, thank you for joining us this morning. appreciate it. want to take a final check on the markets red arrows across the board, 246

points down on the dow nasdaq, if you can move over for a second there, 106 points off, s&p off about 30 points. the ten-year about 4.0, the two-year at 4.760. melissa, thanks for hanging out this morning. >> i'll be back tomorrow. >> join us tomorrow. "squawk on the street" begins right now. good tuesday morning welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber a hefty diet of bearish headlines. moody's put banks on review. ups also weak, ten-year back below 4. our roadmap begins with another downgrade warning. moody difficult's put bigger names on downgrade march. >> we were going to beoc