good morning welcome 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 is off again it's once again just the two of us. >> that's a song, isn't it >> it is a song. it could be the theme song this morning. let's show you u.s. equity futures looking up after maybe not so many ups recently dow looking like it would open up, 62 points higher right now looking at the nasdaq up 52 points the s&p 500 up 12 points treasury yields right now ten-year note sitting just at 4.016 and two-year at 4.760. the u.s. is planning to ban private equity in chinese technology companies reports say president biden plans to issue that executive order today. it is expected to cover direct

investments in three sectors, semiconductors, quantum computing and artificial intelligence the order will prohibit investments in some forms of those technologies and require americans to disclose investments to u.s. governments in some cases. and you know the one that's not necessarily going to be included >> which >> tiktok. >> that's your thing. >> it's not been my thing. it's been the national security thing. >> right. >> for so long. >> but no action taken yet bipartisan cause, problem. >> it should be. i'm not sure it should be. it's surprising given all this effort in this regard and why, for example, under the ai rubric, for example, it wouldn't be included. >> think of all the data the chinese government has access to. >> and that's what people say. >> it has all -- how many lazy girl videos andrew ross sorkin watches per day. >> i have yet to be convinced by the way the chinese government is seeing all this tiktok in terms of the way -- they're trying to build this thing in a

separate way but that's a separate story. >> the concern is that it has access in theory, algorithm and can push certain narratives on to the american people. >> but owned in part by like every private equity firm in new york city. >> right meantime, disney's espn getting into sports gambling is a huge story the company signed a long term exclusive agreement with penn entertainment, licensing its brand for sports betting penn will have ten-year rights to use espn bet name in the u.s. penn will rebrand its bar stool sports book with the espn name starting this fall axios reporting that the deal won't prohibit espn from selling ad space to rival digital sports books like draftkings or fanduel. penn also said its selling all of its bar stool sports subsidiary to dave who founded the brand. they underestimated how tough it

would be to operate in a regulated world and admitted that sports book was denied licenses because of him personally penn paid $551 million to buy barstool the sell back now includes no up front cash but penn will have the right to 50% of gross proceeds in the event that he sells or monetizes bar stool he also agreed to a non-compete. so, what do you think of all of this >> well, disney -- >> on so many front. the disney side. there's the portnoy piece. >> earnings tonight, the disney side of it is really interesting because it really underscores, i think, disney's need to entertain all ways of really monetizing that espn brand it already acquired a stake in draftkings so its acquisition of fox entertainment assets in i forget when, 2019, was it so this is another step towards that it had always been considered taboo for disney to be in

betting because of the risk to the brand, the family image brand. but they got to do this. it makes a lot of sense. >> clearly by the way -- we'll go back to the portnoy part in a minute they had to get rid of bar stool to make a deal like this. >> there's no way that disney could be associated in any way, shape or form with david portnoy. >> and that's an interesting sort of component part of the story. >> definitely. >> look, the big story today hasn't happened yet. it will be in the call the disney call today is all going to be about does bob iger really articulate a clearer message than what he said to david faber, which on our air, which raised all sorts of questions and has basically -- >> put everything out there. really put everything out there. >> really changed the narrative around disney. it created how many news cycles about what's going to happen to the linear channels. all the folks at places like abc will be sitting there listening, trying to figure out are they core or not core to the business

as he referenced last time what's going to happen to some of these other pieces? what does it mean to have other partners i don't believe it when he said partnerships for espn that he was necessarily talking about this this is one sort of smaller piece. >> seems like a small piece. >> the question is, is there an nba deal or is there a deal with one of the leagues or many of the leagues? is there a deal with an amazon i still think that amazon-type of deal where they become a partner in some kind of gtc kind of property. but that's going to be the whole game. >> that would be good. but i think the bigger questions are around hulu, it is around sort of these assets that -- >> hulu is on a straight path to being sold or -- i mean, our parent company is going to sell its stake. i don't think that's up for grabs at this point. i think how much >> how much they pay they don't have balance sheet that would allow them to pay a lot of money they got a ton of debt on their balance sheet.

>> totally but it's a legal situation at this point. >> yeah. >> arbitrator will decide or -- someone will decide what the value is and then it's going -- then they have to pay, i think. >> but in terms of the assets, like abc that you mentioned, what role does that have >> long term and also hulu is an interesting piece because a lot of those properties that he said may not be core end up on this so then the question are there studios or channels themselves >> right. >> that get sold. >> and who buys them we talked to rich greenfield -- >> not a lot of folks who want to double down on this. >> media folks want to be leveraged. they don't want to leverage up and buy another asset, let alone an asset that bob iger can't figure out what to do with. >> maybe that's why private equity comes in. that's in a direct -- tpg with directv, that's a model of sorts of a declining asset that you run for cash

and you're not going to capture the multiple on it but you'll capture the cash on it. >> yeah. all big questions for dizny tonight. meantime, update on a story we told you yesterday, softbank is planning ipo for chip company arm on the nasdaq. nikkei news service says apple, samsung, nvidia signed to invest in arm reuters is reporting that amazon is also in talk to join as cornerstone investor amazon web services makes own processing chip using arm's design this would be the biggest ipo since alibaba. >> talking about ipos that haven't really worked. talk about this? >> it was a spac. >> it was a spac but i remember we covered it i interviewed adam newman. we'll talk about wework now. the shared work space company wework saying there is substantial doubt now about its ability to continue operating. the company citing continued losses, cancelled memberships to its office spaces.

wework's market cap tumbled below $400 million from a high valuation of more than $47 billion back in 2019 i'm not sure the $47 billion valuation is ever real private market valuation in sort of house day when nobody really understood what was going on in the world. >> rates were 0%. >> right the question was always whether the model on to itself made any sense, which is if you're going to make long-term -- they were leasing property from other folks on the long term and then locking you in on the short term could you ever make the math of that work? plus all the debt that had gotten put on top of it. >> yeah. >> and sounds like they're struggling what was so strange -- this was such a pandemic situation, this goes back to sort of what we're talking about eli lilly with pfizer yesterday there was a period of time where it all looked like wework might have a real, real shot because big corporations in this hybrid

world were saying, you know what, actually, employees, you may not have to come back to our office we're actually going to spend even more money than not just having our own office. we'll buy you a subscription netflix style to this thing called wework and we'll go there and have these hubs and everything will go around. i still think it's a great product. i don't know if the model works. >> yeah. on paper it seems like a great idea when they brought in the quote unquote grown-up to sort of turn it around and lift it out of its pandemic woes, that was seen as a huge -- oh, thank goodness but then he quit >> yep. >> that was, huh they still don't have any ceo. they're still looking. he quit, what, 2021. so it's been a while. >> and of course the big loser, you just talked about the company that owns arm, softbank. >> yeah. >> the og, the og behind wework. so nonetheless another story we're watching

this morning is lyft the shares are lower take a look right now. shares trailing up about 8%. ride hailing service reported adjusted earnings 16 cents per share, loss of penny per share revenue grew 3% to just over 1 billion dollars. laying off 25% of its staff to lower prices in market share from rival uber. those cost cuts took a toll on revenue per ride metric. uber stock has, of course, we talked about vastly, outperformed lift to date. having said that, they have a new ceo in lyft who is much more aggressive about pricing wanting to be more competitive the fact they want to be competitive is one of the things that weighed to the degree there's been any weight at all on uber's price because we may get back to one of these days people are trying to arbitrage the prices from their app. that has always been -- if you're a shareholder in these

companies, you didn't want them to compete on price. >> you do that, don't you? i feel like you do. >> oh my good,nness, i do. >> i arbitrage between lyft, uber and yellow taxi cab. >> okay. >> and i will often even order -- i'll order the car, if you will, on the app and i'm willing to accept the $5 whatever cancellation fee. >> because it's so great >> because on taking the taxi these days is often times so great. >> even when you add in the $5. >> even if you lose the $5 absolutely but the more we talk about this on the air, the bigger problem it is for me when i get into the back of the vehicle because we have actually a lot of uber and lyft drivers who happen to watch "squawk box. i have gotten into too many -- >> do you have a three-star rating because of this. >> i got into the back of too many cars that said, did you arbitrage this today

we have a conversation about bitcoin and other things my rating isn't as high as i would like it to be. >> because of -- >> i don't think it's because of that i've been told two things. you want to keep your rating high, if you're going to use the telephone, tell the driver before you're going to use the telephone. oh, i'm going to use the telephone now. >> oh, okay. >> it's a thing. and the other is because we live in buildings in new york city. >> right. >> don't order the car until you're downstairs waiting. >> i never keep uber waiting. >> don't ever leave them waiting. the waiting is a rating killer >> maybe be the arbitrage, too. >> yeah. you can actually go on to uber now and see how many times you've gotten a 5 star, 4 star, are they -- they won't tell you which drive but the actual. >> we'll do this during the break. >> as many of our viewers may go off and do that, too >> exactly. >> go into security settings, privacy, something like that and fool around in there. coming up, we'll talk

strategy ahead of today's opening bell futures pointing to a higher open looking to be up by 12.5 nasdaq is down 54. later brian beast will join us here on set. you're watching "squawk box" on cnbc

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on today's squawk planner,

disney is set to report after the closing bell today among the other highlights, we'll hear from roblox before the opening bet. a fundraising event for republican presidential candidate senator tim scott scheduled for today in the hamptons it's being co-hosted by gary cone and billionaire investor stanley drunkenmiller. joining us is chairman and ceo terry firestone for more on these markets. we saw an interesting day yesterday followed by today. looks like a higher open what did you make of yesterday's action we saw particular weakness in sort of the higher multiple sectors, like software and semiconductors >> hi, melissa yeah, i think that we really needed to have that pause. we had such a strong run in the markets. by the end of last month, it was up 19% we've had enormous strength from software, from consumer

discretionary stocks, from the tech sector and the communications companies so they've led all the way and seeing that earnings were decent, the market went up through them, now with a couple of, you know, bad pieces of news that downgrade yesterday and on that u.s. government, i think it makes sense to have a pause, a reset and then we look to see whether earnings growth can start to accelerate into the second half of this quarter and into next year because we need that because multiples are fairly high. >> are you op mtimistic about te second half of the year? it seems like there's been a real change on sentiment on the street in general when it comes to whether or not you join this rally? it seems like more people are embracing the narrative that the economy will be okay and that this rally is here we have a lot of strategists on the street bumping up their s&p

price targets to year end. >> most strategies were negative going into the year. majority of the banks were all calling for a recession and expecting there to be very, very weak quarters this year. there have been -- the second quarter was down s&p earnings were down so far 4 to 6%. now they're backing away from that on the other hand, the market has moved higher interest rates are probably piquing here inflation has come down from 9% to 3% or 4% depending what number you use if there isn't going to be a recession, then their either is going to be better earnings going forward or we're going to be stuck in this malaise and we heard some optimism from companies. on the other hand, the stock just moved higher. we're in this holding period right now where multiples are high apple got to mid 30s multiple. and investors said, you know, maybe this is a little too high

right now. you look at tech names like google, amazon, meta, performance out of these stocks. there's some profit taking going on so we see there's potential and lots of names. remember the rest of the market is up much less than the s&p if you look at most of the sectors, they're up mid to low single digits. while consumer discretionary technology and consumer communications companies are up around 40% year to date. so, i think there is potential but, you know, we have to just i would say regroup and look to see whether it continues >> are you in a position now, karen, where you're looking for things to buy in this market sounds like you think it's increasingly harder to find value in this market or are you looking to trim positions here knowing that, you know, we're sort of in uncertain territory at this juncture >> we're always doing some of

that that's portfolio management. there are names like charter communications which really has a been a poor stock this year. sold for multiples 11 times next year it had a little negative or a lot of negative investor sentiment this year because some of their capital investments but we believe in that it's starting to act better and reasonable price holding, that's a stock that's been a strong stock but we still see an awful lot of travel in company's plans. you're seeing expansion of their market some of the geographies that were weaker are really showing great strength you hear from the airlines and still, not an expensive stock and multiple bases you know, a name -- even a name like unh that's more defensive. but it's a stock that great healthcare company high employment and that means people have insurance and the coverage in their group is providing a lot of growth to

the company. so, you know, we're finding names. it's just that there's a lot of froth in some of the names in the tech sector. >> karen, always great to speak with you thank you. karen firestone. coming up, the company formally known as twitter making changes to its advertising safety tools that's after the break. later, what's going on in the internet, the world of the internets. "squawk box" coming right back after this

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safety tools partnering with ad company to appear online ads don't appear near controversial content back in july x remained 0. steve kovach has been following the story and joins us now what's happening here? >> yeah. so they partnered with a company ias, publicly traded company i didn't know this until yesterday. what they do -- they claim they can do is -- if you're an advertiser, before your ad goes on to the twitter, they can determine whether or not it will be next to so-called brand safe content. this is a move to attract advertisers back, whether or not this technology works as advertised is a whole another question, i guess. but this is -- this company works with other platforms as well this is not like a new or novel idea. >> is it a keyword >> they do key words and also do level, like how restrictive do you want it to be? or how loose do you want it to

be >> can you be near people and not near other people? i don't want to be near any politicians, for example. >> that, i don't know. i don't know if it's that granular. >> we were talking about dave portnoy. if he was too hot to handle, can you say i don't need -- i don't need to be near dave portnoy others may say i want to be next to every elon musk ad that goes out. other people may say please keep me away. >> this is just a pr move until the advertisers start showing up, right? that is the problem they're in we see advertisers abandoning the platform we see advertising growing on facebook we see advertising -- >> do we continue to see an outflow? >> it might be over now. >> 50% decline >> bottomed out. >> that was a month ago. >> maybe it bottomed out >> do we think anything happened between now and then >> we'll have to ask tomorrow. >> don't you think that good

things are happening -- what they can market good things are happening because they're giving this interview do you think they would go on the air -- >> i think it's a pitch to advertisers. >> a pitch for this. >> yeah. >> they'll have some sort of numbers that seem to be good on the surface. >> right but for every number they get out, they've been putting out press releases like this since linda took over. for every move they make towards brand safety, you have elon musk undercutting it by allowing someone -- >> sorry in the case of twitter, you have a time line that's constantly moving, what is close? or do you also define that >> that i don't know how close but look, yeah, if you scroll three scrolls and you see -- >> right, exactly. >> something unsavory -- >> an hour ago. >> but again, this is very -- think back to youtube just several years ago. ads are literally running against paris content. they had to fix that >> before you go since you are the leading tech reporter at the

network, and i just taught him something, i thought we were going to teach the audience about -- >> you're the leading uber. >> i don't know about that we were discussing that -- viewers get your phone out if you want to know this. it's actually kind of surprising news if you want to know actually the specific number of ratings both 5 star, 4 star, 3 star and 1 star ratings you've been given over time. here is how to find this information out. uber puts it on the app. go to account. put this on a loop so people can find it again. hit settings go down to privacy you're going to hit privacy center you're going to hit see summary all the way to the left. you'll go down to ratings and hit view my ratings. then you can see how many 5 stars, 4 stars, 3 stars, 1 star ratings. >> i'm glad i didn't take a sip of coffee before i looked at this 14 1-star ratings.

i don't know what i'm doing in these ubers. >> apparently things that are hateful. >> i guess i do have 462 5s. >> to bring this home, i know a hedge fund manager, a viewer of this broadcast, that has started the middle of interviews when they're interviewing an applicant to come work at the company -- >> what is your rating >> they say, show me your rating right now. >> i love that >> and literally, asking all these questions. then they say, show me your rating there's nowhere to hide. >> it's true >> there's nothing to do >> right. >> then the question of course is whether you believe that the rating is an accurate assessment of you as a person >> is that an equal employment violation by asking that >> are you wealthy enough to afford uber? >> that, too. >> what if ratings are really old. what if my seven 1 star ratings, i'm horrified about, what if they happened ten years ago when

i started using uber and kept them rating. >> they roll the last 500 rides. 5, 600 rides is how they do it. >> just 500 rides. maybe i'll -- >> last piece of news, if you want to increase your rating, at the end of the drive, tip doesn't matter by the way what does matter about this is the worse your rating, the driver has the choice of picking you up or not. they may try to pick somebody up with a high ratings. tip has nothing to do with it. no, what you can do is look at them, 5 stars for you and you try to get a reciprocal 5 stars for you. >> 5 stars for you, everyone. >> may be used on a summer tuesday. >> i feel like i need that rainbow, the more you know rainbow. that's the most useful thing you will know today. >> i will try it right now when i go. >> we'll put it on tiktok before it gets banned.

>> 4.88 is my rating, by the way. still too low. coming up, we'll dig into penn entertainment's deal for espn's sports deal. as we head to break, a look at yesterday's s&p 500 winners and losers winners and losers is sponsored by - ♪ the biggest ideas inspire new ones. 30 years ago, state street created an etf that inspired the world to invest differently. it still does. what can you do with spy? ♪ ♪ want more from your vitamins?

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good morning welcome back to "squawk box. live at the nasdaq market site in times square. futures, dow looks like it will open up higher, about 85 points higher nasdaq about 55 mopoints s&p 500 up 1,400 points. espn striking a partnership with penn entertainment to relaunch and rebrand its sports book contessa brewer joins us with more on this contessa >> hey, melissa. this is a block buster deal in the sports betting deal. penn pays espn a billion and a half dollars for the right to rebrand penn's online sports book espn bet. espn essentially gets market access with all the regulatory and big chunk of change. plus another half billion in stock warrants this deal is so big that industry insider jaws dropped at

the price tag because other sports book had been in talks with espn but couldn't wrap their minds around how much espn wanted that's according to multiple sources. $150 million a year will eat up a pretty piece of penn's profit. i'm sure we'll hear more about the math on the company's earning call on 9:00 a.m. eastern today along with answers to questions like aren't espn viewers who gamble already gambling we heard from scaesars and draf kings about how important the product is will espn bet prove to be a superior product last hour flitter ceo told me in an exclusive interview that operating a sub scale sports book was just simply too hard. fanduel had a deal with fox bet another big brand name in sports media and it flopped penn's barstool betting app will be relabeled espn bet starting this fall. it's just an indication penn had taken a bet on barstool as media

content partner and now doing it with a more established, higher-level respect brand one more note, draftkings and caesars both had deals with espn which can now be terminated. i'm seeing analyst notes calling that a good thing. melissa? >> contessa, seems like the fanduel fox partnership was a blueprint for this kind of tie-up was there anything that that partnership did that would make what you can do in terms of betting more exclusive or unique to fox sports? i'm just trying to think of how it can be customized to the point where if you wanted to bet on espn content, you had to go to the espn sports book. >> yeah. see, that's something that industry insiders are wondering whether it's commonly known. when you go to the espn app, right now to get sports content, it's not like you're going to be able to on that app place a wager. in order to place the wager,

you're going to still have to go to penn's -- now currently the barstool app but it will be relabeled. so you have to go to penn's proprietary app because that's who has the license to operate the sports book. no matter what it's called and so, i think there might be some confusion moving forward about how integrated this really is and it could be a big deal but, the sense of the industry that i got was that, one, espn was demanding the price tag that was just enormous and the likes of draftkings, caesars, fanduel, they just could not get this deal done. and honestly, i think that there is some enthusiasm on the part of draftkings and caesars about walking away from their partnership with espn. my sources are telling me they just never got the return on that investment that they had originally expected. >> contessa, thanks. contessa brewer. meantime, benchmark crude

price is up nearly 19% in the last two months. and consumers starting to feel the pains. i felt pain at the pump on sunday. >> when did you pump >> on sunday i was a little bit surprised by what was happening there the national average for a gallon of gas at $3.82 up more than 8% from last month's average. for more, want to bring in tom, global head of energy analysis good morning to you. tom, direction ally between now and christmas, only going up >> no, directionally it's going down unless we get a hurricane but that hurricane, if we have one in fact gulf of mexico, would make a major move higher so, without that, if you could guarantee it, i would say we're going to be 25 or 50 cents lower. but in the meantime, we're at kind of stuck at a plateau here with six states paying more for gasoline than they were last year >> what's your explanation for where we are right now >> i think where we are right

now is because of the saudi cuts you know, a million barrels a day in addition to the other opec plus cuts russia probably not able to export about 300,000 that they would otherwise normally do. and then the other thing that's happened in the last month is the speculators and traders have come in and made some hurricane bets on gasoline you know, they trade futures and we probably have the highest skew of long traders betting on prices than we had in three years and that has consequences. >> tom, this morning we got data out of china which shows deflation there, the first deflationary reading since japan in 2021 in the g20 countries we know that china's economy is flagging at this point with no big stimulus in sight. you think we're factoring in enough chinese barrels coming off the market in terms of demands into the oil picture at this point >> well, china has been, you

know, the gunman hasn't fired so far. and you have to wonder about where we might be maybe in the 90s or $100 a barrel if the chinese reopening trade that actually worked. the problem isn't even gasoline right now. it's so many other products. diesel and jet fuel prices are seeing reflation if you compare the numbers today the wholesale numbers to where they were on june 30th, you're up about 70 cents. so, it's kind of like playing wac a molly with the reflation there. the other products that drive commercial businesses and industry are up 60 to 70 cents in about 40 days >> tom, if we were to go out -- i gave you until christmas, but you think longer term if we were to look at a chart over the next three years that we're actually going to go down broadly speaking and be stable or you're in the view that

long-term things are moving in a totally different direction? >> i think that long term we're not going to pay those $5 gas prices that we saw last year matter of fact, you guys are talking about draft kings and the betting places i would bet in two years you'll be able to bet on retail gas prices in the united states. that's going to happen but i don't think that you can make the case for those $5 numbers without a war or without something beyond occasional skirmishes there's plenty of crude oil. i believe people who believe there's enough incentive to raise u.s. crude production to about 13 million barrels a day and then the additions from brazil, venezuela, libya, nigeria will make up for that as well. >> fair enough tom thank you for joining us this morning appreciate it. >> thank you, andrew. >> you bet up next, we'll talk about how insurers are handling the

rapid rise of weight loss drug "squawk box" will be right back. e the fan experience, but to advance how the game is played. now's the time to see what america's largest 5g network can do for your business.

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the weight loss drug boom has created a battle over coverage employers and insurers are setting up for more hurdles for patients bertha coombs has this story. >> rebecca never struggled with weight until seven years ago.

>> breaking my ankle while i was pregnant with my second child was really a big determinant in my weight and of course the pandemic. >> reporter: last year, she turned to an online weight loss program. found health found's doctor started her on an inexpensive generic first. >> i took it for a couple of months and had, you know, lost a few pounds from that, but i wasn't seeing a lot of weight loss and at that point, we decided, okay, we'll switch to a gop 1. >> reporter: she now lost 40 pounds and feels lucky her employer plan covers meds for weight loss. >> it just brought me back to kind of the weight that i was before i started having kids >> reporter: but insurance coverage is getting harder to get. for weight loss, preauthorized gop 1 coverage for found health patients more than doubled in the first quarter to 27% but has since dropped to just 9% the pull back just as sharp for type ii diabetes. >> we have seen something like a 60% decline in people with

diabetes having coverage for these medications since december and the requirements around prior authorization and coverage at all have changed dramatically. >> reporter: large employers like amazon are trying to strike the right balance. >> our position is it's not just about an injection or a surgery, it is how do you put together a combined set of resources that can help people who are struggling with obesity. >> and in 2024, a lot of large employer plans will make workers take steps like rebecca did in order to get coverage for these drugs. getting preauthorization, maybe trying the generics first and then having to adhere to a supervised program one of the things we just heard back from rebecca she had her annual physical and she now doesn't have to take hypertension drugs because her blood pressure is now back to normal so, there are a lot of benefits to these drugs

the question is, how do you pay for them right now, at this price, for a lot of people, it's kind of like a statten, they have to be on it for quite a while. >> the select data from nor voe nor tis, i think it's an obligation for insurers to pay they expect they have to pay for it because it reduces cardiovascular events. >> it becomes like a lipper to 15 years ago we were talking about lipitor, 4, $500 a month it becomes more of an essential drug they'll have the rest of the data later this fall, but if that's the case, it's going to be more difficult to really restrict it. and it also becomes an equity problem because if you're on an employer plan, you're more likely to have it covered. but then talk about people on medicaid can medicaid plans afford to do this and people who may not have a cadillac plan, gold plan coverage, how much are they going to have to pay they can get coupons, which

really help. and that actually has brought rebecca, coupons brought her copay to $10 a month but her employer is paying for the rest. >> yeah. thank you. bertha coombs. coming up the ceo of acimi will join us to talk about the company's latest quarterly results. "squawk box" will be right back. ♪ grow thicker, fuller hair with just one capsule a day of advanced hair complex. conquer hair thinning... ...and fall in love with your hair all over again. only from nature's bounty. he snores like an angry rhino. you've never heard an angry rhino. ...and fall in love with your hair all over again. baby i hear one every night... every night. okay. i'll work on that. 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 citi custom cash℠ card automatically adjusts to earn you more cash back in your top eligible spend category. hi. ♪♪ you don't have to keep tabs on rotating categories... this is the only rotating i care about.

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akamai shares moving higher. company reported stronger than expected results and raised full year earnings and guidance joining us now in the first post earnings interview is tom lane, the akamai ceo tom, great to see you. >> nice to see you as well >> tom, i wanted to focus in on the strength in your business and the quarter for the year that is security you actually lifted the guide also to double digits from single digits percent growth i'm wondering what you see as the main driver there.

>> security was a big driver of the growth and the improved momentum in particular, you know, we have market leading solutions for web app, firewall and bot management and also for segmention to protect enterprises against ransomware and data ex-filtration. and our segmention solutions, now neari ing $100 a year in run rate that's important for enterprises to have. the requirement for critical infrastructure companies. >> what are you seeing in terms of general demand, tom, from companies, you know. there is a concern that the economy might be slowing, that companies might be redirecting or reallocating their tech spend for the rest of the year and into next year what are you seeing in your customers? >> it is a tough environment out there. that's for sure. and customers are looking to cut costs and that does -- there is a silver lining for akamai there. first, they can't afford to go

down they can't afford to have a major data breach or a ransomware issue so that helps akamai also with our cloud computing offerings, we can really help them save money. you know, we can lower the costs of compute in particular, for companies in the media, gaming, commerce verticals, which are large akamai verticals where they're paying the hyperscalers a lot to move the data around and for the hits, for the commerce applications and we can help with those costs. >> how does a.i. fit in? is it a competition in spend, in the tech budget? or does it require more security on, you know, from akamai, for instance >> a.i. is going to require more security gen a.i. is a huge technical advance. whenever you have a big advance like that, there is a lot of uses for good and some uses for bad. and in the case of gen a.i., it is now pretty well known that

there are some strong uses for bad. you can use that to train bots and to morph malware, and it makes it a lot easier to get, you know, very malicious attack software and i think, you know, we're going to see increases in attacks and attacks that can get around traditional firewalls now, you know, that makes it more important than ever that you have a second line of defense with segmention, in particular, you know, with our guard course solution,we detec when there has been a breach, what application has been infected and proactively we brought -- lock the spread and the damage from malware and data ex-filtration occurs when, you know, the malware gets in there and then it spreads and it lock everything down or collect all your data and ex-filtrate it that's what we prevent i think it is going to change the landscape and initially in a very challenging way, but, you know, i think akamai is in a very good position to help our

customers through this. >> so, do you think that -- is that spend for akamai services due to a.i.? is that a 2024 story or beyond? >> i think both. you know, starting to happen now, you already have, you know, fraud gpt, a worm gpt, dark bart, it is not a good situation. and, you know, there is very motivated entities out there organized crime, nation states that are in a really good position to leverage that, and it is going to asymmetically increase the power of the attacker that's why you're really going to need internal second lines of defense. your old firewall just isn't going to do it anymore. >> all right, tom, great to speak with you thank you. >> thank you coming up after the break, two big hours ahead. former white house economic adviser brian dietz is going to join us here on the set to talk all things economy and politics. "squawk box" is coming right

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good morning futures rising this morning after yesterday's tumble

we'll look at what is moving markets ahead of the open. and espn striking a betting deal how it will help the disney entity and what it means for media giant. plus, the president making his rounds to tout his economic program. brian deese is going to join us right here at the table and discuss bidenomics and so much more as the second hour of "squawk box" begins right now. good morning and welcome back to "squawk box" right here on cnbc live at the nasdaq market site in times square i'm andrew ross sorkin with melissa lee. we keep saying it, just the two

of us, that is a song, but we have been having a ball. >> are you going to sing it? >> i will. are you here for the rest of the week as well >> i'll be back on friday. you have time to practice. >> u.s. equity futures at this hour, this will make you feel good dow up 41 points nasdaq up 37 points. s&p 500 up about 9 points. treasuries right now, we have been seeing 4.0 basically on the ten-year, the two-year at 4.770. just talked about oil. let's show you the energy complex. looking at wti crude, if you want to buy it by the barrel, close to 8347 this morning crypto, still $29,000 basically for bitcoin. $29,850. it moved up and then down. you miss crypto. what do you think? >> i'm not miss crypto. >> you've given up >> i've not given up it is not a main focus. >> ether at 1,863. do you think it is losing -- is there a loss of volume in terms

of trading right now. >> definitely off its, you know, highs -- >> totally here's the question, is it a barometer of risk? to the degree we even show this and talk about it in the morning, relative to other asset classes and other things >> on a day, you're here every single morning, on a day when the futures are down a lot, do you look at crypto and see some sort of correlation anymore? >> i don't >> not really? there's your answer. >> okay. >> to dom chu with a look at this morning's premarket movers. good morning, dom. >> good morning, melissa, good morning, andrew. big news in media and entertainment. that's that disney is getting into online gambling the media giant's espn sports entertainment brand inked a partnership deal with penn entertainment to launch an online sports book later on this fall the deal covers ten years and will be worth roughly $2 billion in total penn will give exclusive rights to the espn brand. penn also agreed to sell back

the barstool sports franchise to its founder, dave portnoy. and analysts at jpmorgan upgraded draft kings from neutral to underweight based on valuation and other things on balance, disney shares up .75%. penn soaring, up 13% and draft kings down 5% probably in response to some of the competitive dynamic developing on the earnings front, shares of electric vehiclemaker rivian are higher by a percent or so. 220,000 shares of volume that follows up on yesterday's 2% gain. rivian reported a smaller than expected loss on better than expected revenues and also raised its full year forecast for ev production. now, we'll be getting much more on that story later on when rivian's ceo r.j. scaringe joins us on a first on cnbc interview right here 8:30 a.m. on "squawk box. and we'll end with the video game business and take 2

interactive, higher by roughly 3% in a premarket shade so far this is the company behind franchises like grand theft auto, red dead redemption. it reported lower than expected revenues and gave softer than expected current quarter bookings guidance but did reaffirm its full year forecast for bookings, andrew take two interactive video game publishing up 3.5% back over to you. >> dom, thank you for that the weekly report on mortgage applications is out just now i want to get over to diana olick who has got those numbers. good morning >> good morning, andrew. mortgage rates jumped over 7% last week and that hit demand hard the average rate on the 30-year fixed for conforming loans rose to 7.09% from 6.93%. that's for loans with 20% down jumbos hit 7.04% and the rate on an fha loan rose to 7.02%. that's the highest for that loan in 21 years. remember, fhas are low down payment loans favored by first

time buyers or lower income buyers mortgage applications to buy a home fell for the fourth straight week, down 3% week to week and 27% lower than the same week a year ago, that according to the mortgage bankers association. refi demand fell 4% for the week and was down 37% year over year. and as if higher mortgage rates weren't enough, it was harder even to qualify for a mortgage in july than it has been in a decade the monthly index measuring credit availability dropped in july to the lowest level since 2013, indicating that lending standards are tightening, even further. availability for all loan types dropped, but for jumbos, it fell the hardest because banks face increasing liquidity issues and jumbo loans can't be sold to fannie and freddie, so they're usually held on bank balance sheets back to you. >> thank you for that. we'll talk markets after yesterday's sell-off, joining us right now is mona marjan >> great to be here.

>> we were on a run, then not on a run, then a little one, then went down. what's really happening here during this crazy earnings season >> you know, it is a great question look, we have had a tremendous rally in the first eight months of the year, call it s&p 500 went almost up in a straight line from march to end of july. we were hit with not one, but two downgrades, fitch last week, moodys just a couple of days ago and yet the market is down 2% to 3% off its high. everybody is waiting for this notorious pullback, a period of consolidation, some profit taking, but keep in mind there is a lot of cash on the sidelines. we know about the cd money on the retail side and institutions have that cash waiting as well, ready to deploy. so, what we're seeing is 2024 looks like a decent setup. not only can we see a fed on the sidelines, potentially moving lower, inflation continuing to moderate, but earnings we think improve next year as well. so that's a pretty good backdrop, we think, for risk assets.

>> so 12 months out, though, what do you think the prospect is for higher market in a world where some people think we already went parabolic. >> yeah. look, we think the market is in the beginning stages of a bull market bull markets tend to last three to four years on average that's not to say markets go up in a straight line forever there are on average any normal given year 1 to 3 corrections, 5% to 10% range. we have seen one correction during that march financial crisis period. so we do think, you know, look at volatility but use that volatility as an opportunity to, we think, position for both equities and bonds really. >> but why should the markets have a higher than historic valuation? historic average valuation at a time when rates are not zero percent? what is that case? everybody mentions cash on the sideline what is going to cause the cash on the sideline to come out and pay, you know, a premium multiple for the s&p 500 in a time when theoretically we shouldn't have a premium

multiple given the headwinds >> it is a great point of course, we can talk about that magnificent seven versus the rest of the market look at it that way, magnificent seven, about 28 times next year's earnings. if you look at that 493 that is left, 16.5 times much more reasonable valuations we think in the broader market we think where the opportunity will lie over that next 12-month period is in a broadening out cyclical parts of the market, think about some parts of the bond market, and also international as well. areas that are much more reasonably valued we think have that opportunity now, don't wholesale sell out of your a.i. and tech stocks. we think that's a beginning phase of a long-term market, but fully valued at this point. >> if that's fully valued, you don't think there will be a rotation out >> so we -- >> i think there could be. >> we started to see it. >> if you get into a rotation situation, the idea that holding the guys that you think are at the beginning of this thing may actually be the mistake. >> well, you know, we think that there are probably is going to

be some period of consolidation in those magnificent seven large cap technology broadly, natural to take some profits after a nice run that doesn't mean their run is over it means that, you know, for now, we could see that market shift to the broader parts of the market, the cyclical parts of the market where the economy -- lever to an economy that is doing well longer term that valuation will catch up to the earnings potential and we do think -- >> i always get emails from viewers who say don't just tell me stocks, i buy mutual funds, i buy etfs and indexes and things. what would you do in that regard >> look, etfs are a low cost way to play the market can't buy 500 stocks on your own. we think there is real value in the etf space and mutual funds that are actively managed. we think about good opportunities for active management, maybe not large cap technology or large cap stocks, but small cap stocks, parts of the bond market, good areas where mutual fund managers can

get an advantage so, certainly we think there is opportunities there. we think about bonds, longer durations making a lot of sense here as well. >> mona, thank you. >> thank you, guys >> great to see you. >> awesome. coming up, penn national barstools sports book will be known as espn bets starting this fall after the company struck a deal yesterday we'll talk about what the cash infusion means for disney and espn and preview disney's quarterly results which are out after the bell today "squawk box" will be right back. i'm also mr. leg day...1989! anyone can become an agent of innovation with invesco qqq, a fund that gives you access to nasdaq-100 innovations. i go through a lot of pants. before investing carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com.

espn scoring a deal with penn entertainment penn will sell its stakes in sports book back to founder dave portnoy. it marks a pivot for disney which has been reluctant to enter the business due to its family oriented brand. the app will be promoted on espn platforms and have access to the network's talents. let's bring in the senior media analyst and we'll hear more about this on disney's conference call when it reports after the bell today i'm wondering what do you think, how does this help disney? >> i mean, for disney, espn is a great brand name maybe the best name in sports in the u.s. and maybe globally so it is a way to leverage that

name it is not -- there is no -- disney talked in the past about the concern was would they damage their brand and many studies have shown internal studies that they talked about that it would not damage the brand. it is a way to leverage espn with little financial risk to disney and none really and participate in the upside. >> i see okay on the call today, jessica, what are you expecting from disney? what do you want to hear from bob iger at this point >> there is a lot going on at disney. >> yeah. >> a lot that came out from that cnbc interview that he did a couple weeks ago and so i think a lot of the focus will be on the company's focus strategically, what the priorities are, their plan of attack, what assets they'll keep, what assets, you know, will be divested there is just -- more than normal noise surrounding disney at the moment and they also have

the call tonight and then an analyst meeting in september, a multiday analyst meeting so, i think they will share the strategic priorities >> what do you want to hear? >> look, i think we have seen -- disney is the last company in media to report. so we know kind of the underlying trends in advertising and theme parks, in content, et cetera but i think it is very important to share the plan from bob iger in terms of what they will do with their linear business, what they will do ultimately with espn they have talked about bringing in strategic partners, we're all seeing what that means there are ways to strengthen espn and we will see -- look, if you step back, disney has an incredible collection of well known branded assets they have incredible ip.

and they're just going through an unusually difficult time, meaning there are secular challenges, there are cyclical challenges our view, our subjective view is that bob iger is an incredible manager and will lead the company through it, but there are many, many steps that will have to be taken so we want to really hear from him, how he plans to kind of just leverage disney's assets and get them back on a growth path >> what do you think of disney's valuation at this point? a lot of disney's woes seem to be factored in, but maybe not. it is trading at levels, you know, at the depths of the pandemic, it didn't trade this low, jessica so, what do you make of the stock? >> exactly i think -- look, the stock has not been this low in a long time and on a relative valuation. i don't think it has been this low in i don't even know how long, decades maybe.

so there is a lot of the risk has been taken out of the stock. a lot of things can go right at the moment, it appears incredibly challenged because a lot is unclear the market hates uncertainty and as the company kind of deals with each one of the issues facing it, it -- we think that there is a lot of upside certainly they have, again, they have a lot of assets and brands. it does seem that bob iger is completely aware and he's the one who kind of highlighted what their issues are and it is reticent of what he did years ago when he said espn is challenged because the pay tv universe is declining. at these levels, it does not seem to be a lot of risk of disney stock. >> jessica, in terms of the linear stuff, we were talking earlier in the hour or maybe last hour just about how folks who work at abc this morning or this afternoon will be listening

to this call trying to figure out are they core, what does it mean to be core? if you think through the permutations of selling or spinning off various forms of linear, and the studios and other things that are providing the content to things like hulu and other things, how does that work in your mind? >> i mean, look, there are a lot of questions raised from the interview that bob did what does he mean about, you know, what will he do? the linear business is completely challenged. the paid tv universe as you know is declining but it doesn't mean that these assets don't have value. so if you look at what viewers are watching on streaming, very often they're watching broadcast and cable network shows just on a different distribution platform so, it is unclear as of now what he means exactly by not owning these assets or maybe not owning 100% of these assets, who the partners may be, what it would look like. it is just not clear

there is tremendous value. when nbc, your parent company, took content off of hulu and put it on peacock, you could see where the subs went. they went to peacock so, there is tremendous value in broadcast and cable content and i think that if cnbc was in a different platform, people would follow you >> god bless you, jessica, thank you. >> jessica, thank you. jessica ehrlich. coming up on the other side of this, we'll probably talk more disney throughout the show. but when we return, americans turning to their credit cards this summer and total credit card balance is jumping above $1 trillion we're going to talk about that after the break and what it means. plus, look at the futures now. dow looking like it would open higher, 37.5 points. nasdaq up 23 points. and the s&p 500 looking to open about 7 points higher. "squawk box" returns after this. time now for today's aflac trivia question.

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aflac trivia question. which nfl team has the most hall of famers? the answer, the chicago bears. >> credit card debt in the u.s. reached a staggering record high, topping $1 trillion for the first time this according to the federal reserve bank of new york as millions of card holders carry balances month after month, year after year cnbc's senior personal finance correspondent sharon epperson joins us now with strategies to help them pay it off you got to pay it off. the interest rates are so high. >> you have to pay it off. it is an inflation and robust spending that helped push americans overall credit card balances past the $1 trillion mark in the second quarter and that's according to new york fed researchers. after a series of fed rate hikes, interest rates on credit cards have now risen to over 20% on average and that's making it an extremely expensive way to borrow money for americans using credit cards to cover basic household costs and many other

expenses too >> it is not just folks who absolutely have to use cards, it is folks who are doing it because they want to, maybe they're investing in a small business or remodeling a house or whatever the reason might be. you have folks with a lot of money who are running up credit card debt. >> and many of them are carrying that debt for months or even years. so here are a few strategies to help pay it off. first, call your card issuer and ask for a lower annual percentage rate. a lending tree survey found about three quarters of consumers who asked for a lower rate got one also, try to snag a zero percent interest balance transfer card these cards offer 12, 15, 20 months with no interest on transfer balances. now, once you get up wione you o be aggressive on paying off as much of the balance as you can during the introductory period if you have balances on multiple cards, figure out if you're

going to prioritize paying off the highest interest debt first or start with the smallest balance and work your way up to the largest balance. one strategy isn't necessarily better than the other, experts say, just make a plan, stick to it, and get it done. >> get it done is the most important thing. >> the most important part. >> a lot of consumers have to make a lot of tough choices when student loan repayments are due in the fall. what are some tips, advice you give them? >> you know, there are tens of millions of people that are carrying debt year after year. and so that is a big concern now with student debt repayments starting in october. that's a big x factor. will people be able to afford to make their credit card payments? so now is the time that financial advisers are saying make sure you find out what you owe, call the loan servicer, which may be a different one than three years ago, make sure you understand what you may owe if you do an income driven repayment plan and that may be a way to cut the payments maybe even in half the problem for parents who have loans, those plus loans do not really fall under income driven

repayment plans. that's tough budgeting and making these hard choices is what people are going to have to do. >> like any debt, you have to consider the interest rate you're paying, right and so your credit card debt may be a much higher interest rate than your student loan debt and you have a grace period on your student loan debt. >> you have 12 months before it hits your credit report. so that's very important but i think that's a really important point. this is a variable rate that is going to go higher on credit cards. fixed rate loans, that's something that you, again have to prioritize that perhaps higher interest debt and getting that paid off. but finding out if there is some way you can try to budget the payments, putting money now in a high yield savings account that's the silver lining of the interest rate hikes, we're getting more money on our savings in the high yield accounts, try to do that so you're prepared foroctober or whenever you can finally start to make the payments. >> great tips. sharon, thanks so much. >> sure. >> we got to win the lottery. >> isn't there like some $1.5

billion? >> yes, someone just won $1.58 billion, most money ever last night. >> wow. >> huge -- >> you heard of the curse of the lottery. >> i would take it i would take it. and i would take it in cash. i would take it -- otherwise, you take the $1.5 billion over, you know, 30 years or something, otherwise you take $700 million, $800 million, one shot. >> you want the lump sum. >> you want the lump sum you should do a whole segment. >> next big drawing. >> it helps. it helps with the student debt still to come, former nec director brian deese on the state of the economy and what he thinks the fed should do next. plus, researchers exploring whether obesity drugs like ozempic could help pverent cognitive decline. former fda commissioner dr. scott gottlieb will join us with the latest on that. stay tuned you're watching "squawk box" and this is cnbc

welcome back to "squawk box. billions of dollars pouring into semiconductor manufacturing here in the united states with the promise of creating thousands of jobs one of the biggest challenges so far has been the lack of talent in the workforce kristina partsinevelos joins us now with more on that. good morning >> good morning.

you said billions of dollars, it is actually $231 billion that is expected to come to the chip space. as companies begin construction, expanding, they realize how difficult it is to find the talent like lab technicians that would work here. this is a clean room heading into the r&d section at wolf speed. a company like taiwan semiconductor is a prime example. they have two manufacturing hubs in arizona they publicly said they're going to delay production until 2025 due to a lack of skilled u.s. workers. they're actually flying in taiwanese workers to work with the advanced equipment and train u.s. staff so i caught up with the president and asked him if it was a matter of cheap labor. listen >> it actually is more expensive to bring the worker from taiwan, pay them a fair u.s. salary while in the u.s., and pay for all their relocation and housing and support. it actually makes them more expensive. >> much of the semiconductor supply chain is based overseas, so there is fewer qualified

workers here in the united states there is a new study that says there is going to be roughly 115,000 new semiconductor jobs added by 2030 here in the u.s., but over half risk going unfulfilled because of the lack of educational programs and training and companies like intel are taking notice. >> we do see that skilled labor, the construction, as well as skilled labor for our fabs is something we have to work on >> and the white house is announcing today the one year anniversary of the chips act is making progress. over 50 community colleges that have some type of semiconductor program and they're allocating roughly $13 billion to workforce training a room like this, a clean room, it is not easy to find technicians, to find engineers, to find computer sciences that can work within this space so, again, this wait continues to fill that talent gap that does exist in the united states. andrew >> thank you so much for that report, fascinating stuff.

we're going to continue this conversation because president biden taking a bit of a victory lap, but one year after signing that inflation reduction and chips and sciences act into law, the president traveling across the country touting his administration's accomplishments. called bidenomics. someone who helped enact the bidenomics program is at our table, brian deese good morning to you. >> good to see you. >> so, here's the thing that i -- i'm just going to go straight to it there is a lot of good that i think has come out of this i think. however, for reasons that i -- are inexplicable to me, if you look at the polls, we have a presidential election coming, for -- there is a huge swath of americans who are not prepared, a, to vote for president biden again, but, b, even polled on their view of the economy, they don't think it is very good. what do you make of that >> well, let's start with the economics and then go to the politics on the economics, in a year we

have seen the most significant economic response to any piece of legislation in seven years. we have seen a doubling of manufacturing construction and under the hood you see that in semiconductors, but you also see that in clean energy, multiples of what we have ever seen in this country before. and that holds the prospect for driving productivity, for driving better job opportunities in the future. and for meeting our climate goals. out of the gate, very strong you go to the politics and say, well, why is this not immediately translating? people have a lot of theories. i go to the most simple and basic. p people are rational and they ask themselves, that's good, is that going to sustain across time and so economists like to say, you know, sentiment operates with a lag what that means is people are rational and they want to see is the good news going to translate into long-standing good news for their communities. i was down in that tsmc facility in the phoenix region and you have in that region now semiconductor facilities,

battery facilities, creating a bit of a hub in that space that has the potential to change the trajectory for so many families in that region. but i think they are going to ask is this going to be a year, two, three, four, it is going to take some time. >> that's very interesting if we were to go to the areas that should benefit from this the most, it is actually even worse, i imagine, if you look at some of the states and you look at the people in those regions, do they say to themselves -- >> i think it is the opposite in the following sense. the closer you get to the ground level, the more concrete and tangible this becomes. and this is why i think to understand the impact of this three pieces of legislation, you have to use a map. you have to go very specifically to the specific places and that's why we're also seeing the strange politics of republicans claiming credit or not denying credit when there is actually a facility that is being built in their district because at the very local level, these things become less

partisan political and more practical. so the question is, does that aggregate up and does that aggregate to a national story that people who may not have themselves or a kid who is interested in going to the semiconductor industry, do they understand that it is part of a broader national trend. >> do you think all of this is inflationary >> no. >> part of the story, and i think why to the extent that americans feel what they feel about the economy, it is an inflation story. it is that their wages of not tracking and caught up to how much things cost >> yeah. so, in terms of consumer sentiment, i think that a lot of this is about inflation. and a lot of it is about what has been so unique about this economy. everything about this economy has been out of sample for the last two or three years including the run-up in inflation. and, again, to go to the most simple explanation, when real wages are falling, people feel like they can buy less and feel uncertainty in their lives for the last year, we have seen

that flip. and i think a lot of what people missed in the resilience story and in the improvement in the economic outlook is that real wages have now, for several months, been running positive and that changes people's sentiment. we're starting to see that in the sentiment data, you should see that run through i think the investment packages, this industrial strategy is about something bigger it is about changing structurally, productivity trends in the country, changing our capacity in the country, that is a long needed and potentially really positive economic story the politics of it, you know, we'll have to see. >> ultimately, when the fed talks about a 2% inflation target, if we're structurally changing the way our economy is built, by reshoring, shouldn't that inflation target just naturally be higher? because it does cost more money to make a chip on u.s. ground as opposed to in taiwan or elsewhere. >> yeah. look, i think that may be where we're headed over the medium

term, but, you know, for on this show and many of us, many of you, in the last decade, we spent most of our time worried about this issue of secular stagnation, that we were going to operate belowour productivity capacity for structural reasons and i think that this investment campaign has the potential to change that structurally that means that you would operate in a higher growth, higher wage, higher rate environment. >> higher inflation environment. >> but to do so in a way that you get to a stable equilibrium that actually produces better real wage outcomes for americans and higher productivity growth over the long term that's within sight now. obviously this transition is unique, but that's within sight. >> do you feel the inflation reduction act was named appropriately? i mean, it was announced, it was passed when inflation had peaked, basically. so it is not because of the inflation reduction act that we saw inflation come down. it was a lot of other forces going on

it may still bring inflation down in the future, but do you think that was the right thing to call it, given what -- you're saying it is promising growth. >> yeah. >> jobs, you know, all these other things. >> yeah. look, i think that -- i think that there is a lot of creativity that goes into naming pieces of legislation. what i would say on this front, though, and on the one-year anniversary, we're talking about fiscal issues too, one of the things about the inflation reduction act that we talk less about, we talk about investment and clean energy and this, you know, industrial strategy. it was also a valuable model for how to address our fiscal issues because it was about investing and cutting the deficit. and we all know that cutting the deficit in our political environment right now is very different. it provides a model to do that. >> how concern ready you, do you say to yourself, this is going to be success that the clean energy programs that have been put in place are being used? the uptake on the programs are being used at multiples, i

think, mostly expectations of what people ever anticipated, in which case there is going to be a lot more subsidies and things that had not been put into the -- baked into the original cake so when we go look at the numbers, five, ten years from now, i don't know. do you say this is great success, it looks more attractive or this costs us a small fortune and what did we get for it >> it is a great question that goes to the fundamental of the economic response we have seen at core this is about private sector investment. and that's what's unique about these three sets of bills is they have accomplished something that government policy doesn't always accomplish, which is to provide enough long-term certainty that private capital is now putting itself at risk to build and scale in areas they haven't before i think overwhelmingly that is very positive. and the biggest risk we have to the segment before about workforce or permitting or otherwise is that we don't follow through on the other necessary elements to actually allow that investment to happen. and to provide the economic benefits i think that's the bigger risk

you want to pay attention to the fiscal side, but this goes to the structure of the inflation reduction act. it had $2 of deficit reduction even if you take the higher estimates, by the end of the decade, you're still just that bill alone is still generating $40 billion of deficit reduction a year keep your eye on it. overall, the more economic response we can have in terms of durable private investment in potentially high productivity areas of our economy, that's a very good -- >> two other questions for me. one is, we saw this headline this morning about venture capital private equity being prevented effectively from investing in certain parts of the chinese economic ecosphere, if you will, depending on which industries we're talking about >> yeah. >> what do you think the ultimate impact of that is going to be in terms of the relationship with china, how things shift, et cetera? >> so i think the impact at this particular provision is going to be very small. but i don't think you should view it in isolation this is part of a broader

dynamic, which i think is the most complicated dynamic the administration faces today, how to navigate this competition challenge with china, particularly around where and how to put real gates on investment and technology. this particular issue on limiting investment is small quantitatively it is also a first test for this administration's theory of what they refer to as a small garden and a high wall, meaning focus very narrowly on a set of technologies that might have dual use application, that might have national security concern, make it very difficult for china in that context. i think that's what you'll see in the context of this outbound investment restriction set of rules. it will then -- the question over the course of the fall is when we look at other export controls and updating semiconductor controls, cfius restrictions on inbound investment to the united states, how can the united states stitch all of these things together into a coherent strategy that says there are some places where we really do need to deny, there are other places where it

doesn't make sense. >> okay, final question from me. >> yeah. >> before your time in the white house you spent time working with blackrock and larry fink and helped them build arguably their esg platform larry fink has now publicly said that the phrase esg has been weaponized politically and there has been a massive pushback as you've seen and some companies have had to sort of navigate this in a unique way, including blackrock, by the way. recently announcing that they're putting the head of aramco on the board of blackrock in a world of esg what do you make of that, what do you make of what's happening here, and what do you make of the entire esg movement? >> so, i've always continued to think that the term esg itself is -- does more to confuse than clarify. and that we actually always called what we were working on sustainable investing. we talked about it at times and

people said that's semantics it is more than that sustainable investing, i think you're seeing a basic fiduciary argument that if there are material factors to long-term durable profitability around how you operate your business and how efficient you are with environmental issues or how effective you are at retaining a talented workforce, that's are going to matter over the long-term. i think if anything we have seen that play out in terms of an investment thesis over the course of time i think where it gets difficult is when people try to put everything on to an individual term and esg lend itself to that. i will say out of all of that confusion and out of all of that politization i think what you're seeing is you're going to see an enormous boom in sustainable investing and the question -- people may call it different things, people may name it different things, but at core, the question is how do you generate durable long-term returns? if you are thinking about investing anywhere in the world today, and you don't have a view on what the, for example, the

environmental impact is going to be on the investments that you're making, you're probably not actually effectively allocating capital and that's become -- that's become as mainstream as anything today. >> having the ceo of aramco on the board of blackrock, is that consistent or inconsistent with the idea of sustainability in your mind? >> the beauty of sustainable investing from my perspective is individual companies make fiduciary decisions that -- and they'll make those calls on that front and the market will make a judgment on that >> brian deese, he's a politician of sorts. nice to see you, sir thank you. appreciate it. >> thank you. coming up, lina khan versus amazon the ftc expected to meet with az ithe coming weeks a sign that an antitrust suit could be coming. get the best of "squawk box" on our daily podcast, follow squawk pod and listen to us anytime stay tuned so you won't miss an opportunity. e*trade from morgan stanley.

coming up, amazon set to meet with ftc chair lina khan next week in a push to avoid an antitrust lawsuit. can the two sides come to a comprise at the top of the hour, wall street power broker blair ephron ho aadning us.

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amazon meeting with lina khan next week a recent spring of lawsuits could shift khan against big

tech dan, great to have you with us is she going to go another route this time? what do you think? >> it's interesting when you look at the ftc under khan, the losses have all been under big tech there's been a bunch of mergers but it's been big tech where she's had the problems it seems like she is going after amazon, those reports are that the amazon commissioners are going to meet the next week, called a so-called last rites. we don't know how broad she goes to go or how narrow she might go >> she was hired to be an activist sort of ftc chair, to really challenge big tech, to go after them so is it enough for her to bring

these lawsuits and lose? is that still winning in the ftc's views? i think that's important to understand in terms of what big tech potentially has to lose because they did have to lose nothing by being sued except legal costs and a headache >> i think the ftc and the d.o.j. in the biden administration has not only stopped certain mergers either through court or threat of court but there are certain deals that you and i never heard of because they never got to the serious negotiation stage just because people thought we're going to get screwed by the sec, it's not going to be worth the time or the risk part of their stance has been be extremely active and we'll kill some mergers lina khan succeeded in lots of other industries, including some

tech there was this ice merger and they've pulled the lawsuit because ice has decided to divest big assets. when it comes to the big tech ktech, she hasn't >> is anyone worried >>y don't know what the details of the suit are. the ftc already sued once. am. >> amazon when it came to the inability in the lawsuit it goes back to microsoft 20, 30 years ago. microsoft ends up winning that case but it took so much time and so much effort, it took its eye off the ball and thus allowed google to exist.

>> the other big news of the morning is private equity and venture capital you know so well, the biden administration planning to effectively block that sectors of our economy from buying into certain sectors of the chinese economy. what are you hearing on the ground about it? >> i'm extremely confused about this the specifics in the language i want to see for two big reasons. one, they're trying to block a.i. every company right now defines itself as an a. ii. company and to do it on private market investing i find fascinating it seems again like there's a massive loophole go public. and any u.s. capital firm or mutual fund could buy into you >> and go public anywhere,

right? even if there are resources in listing in the united states do you think that they acknowledge there's this loophole it does seem like private equity and venture capital money, basically nothing goes to china right now because they don't want any part of it. >> there's still sm. there are still a bunch of firms that have almost equal conditions arms and be across boort orj this willly. i think the specifics of this language are very many important and is and we're now in august i think they have taken a lot of time to try to write this in a way that's going to be effective. i'm extraordinarily interested

in seeing the actual language on it one of the o'founders of carlisle used to say america's greatest export is its capital this is a way to eat into that >> coming up, co-partner blair chef rons will be here in an interview you want want to miss. we'll break down the numbers with the ceo when we come back i, on, carhartt, hoka and more. the looks you want, the backpacks you need, all under one roof. when you can't make it to the store, dicks.com is always an option. and now through august 12th take 20% off select nike styles. with looks this good, it's never been easier to sport your style. ♪♪

good morning futures modestly in the green this morning things haven't been all that positive lately on wall street, the dow down four of the first five sessions. in just minutes we'll speak exclusively about the markets and other things with blair ephron meantime, disney betting on betting as they pair up with an entertainment company. and what you need to know about the new class of diabetes drugs being prescribed for maybe vanity stwel

the final hour of "squawk box" begin. good morning welcome to box bach. we're right here on cnbc live with "the new york times" market set in times square. becky and joe are after what's been a tough little bout in the market 65 up on the points we opened right now. treasury yields still sitting pachbt zchlkt here's some of the stories investors will be talking about today. reports say the biden administration will lay out new restrictions in chinese high-tech, expected to apply to

personal investors nd. >> penn' prp the deal will give estn who nrmwe're going to tal more about this game later on this morning rng and they are raising doubt about its ability to pin fornl and was one valued by ouf ffrmgs and the video game company lost 46 cents a share. maybe they didn't use it that much this summer and the penney worth coming in

it was a bit lighter than the street had been anticipating meantime, it's been quite a while since our next guest was here on set. in fact, we're thrilled to have him. he's the co-founder and corporate and advisories acquisition firm it has advised in more than $4 trillion in transactions let's cam him one of the great ceos and board whisperers of our business >> how are you >> we good but rp checking my blood pressure of what's going on in corporate america. we keep looking at this market that's done kwaitonight you think it's all portend

>> i think in most board rooms, andrew, most c have been ahead among where the general feeling was among economists if you look at the second quarter, no surprise that monday than two-thirds of our again, the s&p 3,500s, s&p they will do better when companies think of that steks year, with office in 125 years, most are 25 prng. >> and now they're getting more optimistic and that is hmm and in my world you'll see m & a

i think in '32 it will be very, very bullish for, from and despite the confidence in maybe their own businesses, there's been a lack of ability to get big grabbing transactions across the business lines so in this political environment, do you think that there's a shift? now that we've actually seen a number of these deals that were contested and in these instances where the corporations have actually won these cases or at least appear to be winning these cases that people are going to be more confident and go to transactions or is this a wait and see, let's get through this election and change the election to the o are side? >> it you they're going to get

your assumptions are going if are more easily met. that's important confidence that you talk about it being a year and a half that companies frmsnd it. i'u think that your rng than you would have been a year ago. one of the reasons i think you've heard it is when it early 'nrm and m & a, 50% from its 21

high, i'm going to bet that is going to be the low for a cycle approximately and they've created a who are nrm. >> it is it's priz frms, you have four years of staying with what in were twrrks and again, i think what's going it be more. ahead of expectations. in the rest. ly did put out this merger guidance fchls sflchls what was the re national this nchlgs are

very good about managing creative unearn teepity. talked about why are frame work. pr it's a walk in the park, right? i believe most temperatures take the data, make judgments and you factor it into your decision making gh we've been talking about regulatory negativity. we've seen 50 basis points of increases in that same period. it doesn't seem to be too much of a head wind until we got to 4% are ceos still confident, in your view, even with higher and lon prpgs and you eye ffrp sflm

and again you factor that into your thinking. i dpochl ritz prchlt and again, i think owl be furchlt and snurmt and i think the 2% special has been lngd nchlgt it's a long-term goud so i m (and it portrays an i bridge ant sfchlt and it's working. fchs wage increases this year will be a little bit know owe ffrm nomle

it hasn't tull nfrm of. it or ffrm talking about making your life easier as a banker, one of the things you guys is you make lots of let in if nchlkt. >> -- sfwlrnlt we may be analysts but every other berm and any or industry snachltnd chat dmchlt you a about sfruchlt

and when you kicked off of f so one of the things with her sfermt and going to asset managers where tles a a lot more for opinion i in nrpgs so whether snuchlt nfrmts you have a group of six or seven firm which i think i still neechl goldman sachs, for example, it mack shoes nufrmgs and they will be on gold yoursfrmt as it con

certainly dated. sfluchlt and poll tgs nchlgs frchgs do you do youy no (i would narpgs and you hugh number this is (will focus on n

and eight of the of thises sfchlgs and 35% of that has to get spent. that will be a tell. three, a relationship in the global economic alliance more generally, positive. and then finally, four, avoiding patriotfalls being be fnk if you have a tale went, that will be a plus and i think frm i've pay fch and jacquesia miller doing a fund-raiser i think today in the hamptons >> yeah. >> how do you see the -- just speak to it. you talked a lot of both >> the issue on wall street is unlike other areas of red raers

rps and friendships across the i'll and we're rable to a frfrmt and actually i think there are a lot of things are that nrms and we are grateful for the idea that we are willing to listen, factor in the perspectives and come up with a viewpoint and you see that happening even with the stock environment. >> well, you answered that question very diplomatically >> that's where i was going with that >> thank you for being at the table with us. >> thanks, guys. >> plus. >> plus, we'll hear from the teo of r stay tuned you're watching "squawk box" here on krp nbc

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my top priority is the ability to expand the drug in our pipeline to meet the challenge here, which is a great opportunity. people are frustrated when they can't get their medicine we understand that and fix that problem. >> that was eli lilly's ceo, which will be cleared soon to treat obesity with the drug. and let's talk about it. there's so much to talk about with these drugs let's talk about the cognitive decline issue first, which is how promising do you think that component part of this may very well be? >> look, it depends on what you

fee feel when you see a benefit like the one. we saw yesterday where you saw 20% reduction in the risk of cardiac outcomes, either heart attacks or strokes in patients who already had a history of mrchlt irchlts or strokes, patients with a significant cardio did and being entirely by the weight loss these drugs are inducing o whether or not the drugs having a broader impact things like metabolic syndrome if you start to believe these drugs are having a broader impact on overall inflammation in the body, for example, it does become possible these drugs could affect things like alzheimer's disease.

>> do you have any concern about the long-term side effects of these drugs? i ask because there are folks tuesdaying these drugs that should be using this and then there's a lot of folks starting to use these drugs as a vanity perspective. but they might think they're using them for more tab a vanny are and i think these drugs need to be care flow very be where it's not going to be just transient use pu tuity in many cases you'll regain the weight remember, we have a lot of try with thoo ag nis drugsing of diabetes is about four times the

dpochlgs we p we don't have as much long-term data on fuchl and causes loss in lean and the body habit that could be debt, and the companies that doing that, know owe where with rm you think they started that in 2021. the stud that cape out yesterday looking at the yardio rook sfrrk 57% of whom had had a history of heart apaq about 735, if and looking at has to potential fung for nor indication, much lower

dosages that are nrms about the -- tear chetically, the nepgs so we don't really understand, do we kwerks and for maybe a decade, we won't know it until it actually happens at this point >> well, look, it's really tifl new that we see these drugs being used for weight loss at higher doses the companies are continued to track the patience, looking at the long-term poe sense sequeli of these drugs at good frrpgs and you see sealing some helt mord park. it think we're going to go north

mefrp al nems keeping patients on these high doses in perpetuity isn't going to have some health risks associated with it. that's why it's important to make sure these people put on these drugs are properly indicated and have significant risk factors where the weight loss they're achieving is going to help their health >> in truth given what you know at least anecdotally, do you think it's being prescribed properly even the growth, i'm not sure it's coming strictly from folks who are obese, right >> yeah, when you look at the overall data on utilization right now, about 5,000 prescriptions were written this year it's a little bit more than 1.5% of the population, probably on bmi alone, up to 40% of the population is indicated for these drugs for risk factor and bmi. i wouldn't be sure if it continues to show positive

outcomes about 20% of the american population is on statins so i think overall it's being used appropriately i think on the margins there is inappropriate utilization where people are just using it for more of a cosmetic purpose i think that's largely anecdotal, probably in a lot of our social circles in new york city so we're seeing more of it. >> i'm not disagreeing that there's not huge swaths of america that have a bmi where this could behelpful i'm saying that if you look at the concentration of prescriptions on the upper east side and beverly hills that you might have a different view of what's happening here and how we should think about that. >> yeah, look, i would tend to agree with you just based on my anecdotal evidence of what i'm hearing, that there is some excess utilization in certain pockets of the country i don't think that's pervasive when you look at the medicare data with lilly, about 25% have

indicated prescriptions were turned down by medicare and that's for diabetes. i think the payors are taking a very cautious approach to covering this and that's becoming a barrier to access for a lot of people. but i don't think there's excessive utilization overall. >> when maybe you can put your pfizer board on. you're involved in a lot of different companies. we've been looking a the these charts and looking at eli lilly and it's just a monster in terms of valuation pfizer had a $100 billion vaccine business during covid. do you look at this and say it makes sense or it's a crazy hype cycle? what do you think? >> i won't comment on pfizer's stock as a board member. i think they've built out one of the best pipelines in the

industry when you look at the drugs for alzheimer's, they've also built out a pipeline for metabolic disease that are in the early stages of development. they so i do think that they're a higher multiple than others in industry and i think they at the serve. when we come back, espn's big bet on better. what does the business's new partnership mean we're going to talk about that when "squawk box" returns

big news on sports betting as espn partners with penn entertainment. julia, this all comes ahead of disney's report after the bell today. >> that's right. disney is making its biggest move into betting as espn is launching a new sports book to relaunch its bar stool branned sports book as penn is now digesting entirely a bar stool sport. the new service will be call espn bet and it will be espn's excluf uf marking.

it will give them rights nor ten years with penn paying espn $1.5 billion in grash and $50000 million in rur designate a non-boarding board observer. this didn't just about the cash stock outside, it's almost about the grt to bet on game that your frshl he took a stake in the espn as it navigates cord cutting. we have reported those deals in talk and it will be the nhl to poe lengsly make an investment we'll have that easternings el

rng. >> well, to are disney of course, it namely an organizing con traction, cord cutting, so we give you any updates on the cost custing while some of the other temperatures pg decline in recent quarters, investors are expecting disney's streaming costs to increase this quarter by about $100 million compared to last year after the company's gays and are that. >> julia thank you >> coming up, a new move from x formerly phone as twiner for it

frm ache more look the prrp amidanalyst estimates. looking for eyes on that plus, the proom poem and tomorrow in the 8 a.m. hour about all of this. we're coming right back. ( ♪♪ ) feel the power of osteo bi-flex®. taken every day, it's clinically shown to improve joint comfort in 7 days, with significant improvement over time.

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welcome back to "squawk box" on cnbc. taking a check on futures, we're looking a the a higher open after yesterday's decline, s&p 500 up by 11 right now, nasdaq looking at about 45 at the hope. check out shares of carvana. it expects adjusted e bitda and got an uptick since rate reduction. >> nilgood morning are andrew.

you heard and frnl you raised your guidance for the third quarter and then your production for the kwul year do you feel like you finally have turned the corner when it comes to. >> yeah, it's and you approximately frm -- it's been a great first half of the your as we they about out of 2022. as we stand today, we have a tremendous level of sikt arm when i is significant, sick and f. r.j., are you seeing pricing pressure kelly blue look is out this

morning. just nom and they continue to come down. now dwru number what do you think of the r4-1? with. >> mt ol fmt and that allows us it how in f but krach an entry level version. this is 63 half seconds, over a quarter mile of range in some configurations this is frat, had the other thing i'd say is residualle u

sfrchl and looking at the vehicles if you sfrchl andless of electric or gasoline or internal combustion, the wrigt n and this is strong demand drop that we have >> andre prchlt ands that going to to be ultimate will you mamt you have been in ship too mapped n but the greatest at the nachltd that she'd be -- up

until prior to the second quarter of '23, a majority of of our many in the furst time when red one askedoverall one pre ducks and we're going to continue to continue would you f the l 1 s is a more notable and it's a slightly higher price point and in terms of build efficiency, i talked about in an earnings called questioned we beenful mr. and, hey,

harchlt. >> from andoff lusly the shave helder in. you with traps bring already fumt yup >> where do things stand with fwrchlt as you said, many fachlt and n in parts of our business but importantly they're narm when you think about the same of for them to con vrt to lk trk at the speed that forkball flfrmt but importantly we're also

working to open up the specific divisions we have in our original contract that will allow us to sell vehicles to other logistic operators and users of large commercial vans so we're excited about that, we're making good progress and we hope we have something to say more specifically on that soon >> okay, one last thing, r.j you guys are in the process of billing your plant in georgia. that's where you're going to build the r2 product line, the smaller vehicles, low are priced vehicles in order to be a place to get you better production in part two. >> yes, georgia is making progress part of the work that's under way now is all the grading work. about 80% of the pipe's have been graded and very ses we've also kicked off long lead items for some of the equipment that goes in. those are thiengs uk the may

many that we're in a strong cash position and won't require any additional capital through 2025. we're able to foam is temperature aside from mash. >> many and the pass p rrchlt. from all right, little, bim being nchks. coming up, we'll ask what ainitial see as biggest challenge. stay tune

. recapping one of our top stories of the morning, the white house with new restrictions today in certain american investments in chinese high tech, applying to capitol check out sop of the major u.s. chip companies this morning. they apparently won't get hit by this we were talking with dan earlier about the inconsistency of it very well may be a venture capital firm or private equity

firm can't invest in these businesses but, boy, if you go public -- >> the chinese -- everywhere you go there is a bill of gain by anybody. >> new new for brands and to bring it elon the company ind congratulate add eye sense will aniece chaefr, the keep are frm what's your take on this because it seems luke it's tie to make your more add frmt and then it's only as good as that

product and this snuchlkt so while the announcement was about a vendor contract, the biggest message is they're aligning to standards set by the global alliance of responsible media, a multiple stake body that's trying to wrangle and wrestle with what the filter stability tub or market leading approach for all social media fortunately where platforms are competing and innovating on safety as much as sfnks that now x is, quote unquote, a plate it. >> it's a verb, nat a lon

personal tfrmt i doubt it but the fip sfrchl that's what you want is policy making, which is little bit more agile response to problems. we eat are going to frnl or we're going to fine. from by improving the quality through it can, if i think we can introduce a new approach that i think the public will benefit from and the advertisers might feel a little more to have the nn. >> how did these standard apply

for nrm he's trying to fit pout n and now do you think about that in. >> that's a will m n in an era of complex chapg it fchls so you you a about a week and a half ago the biden administration from and what this said was, among or this nrpgs and more important think this this f that can be in a program lube the x approximately to f and it fear

that frmt because they in faux nor the most safety, brd safety and the like, but the truth is that actually for the most part -- this is what i'm trying to think about the different platforms -- that it's really about the roi on the ad, fundamentally, and there's brand advertisers, which historically have advertised on twitter, interestingly, more than sort of direct-to-consumer folks who were trying to actually ring the register in that moment. and so how you think about those two types of advertisers in the context of this conversation about brand safety do the folks who are just trying to ring the register in the moment care as much about the brand safety as somebody who's running an image campaign? >> that was the most interesting thing in the announcement, which is that buried in the details

was this idea that x would continue to invest in more choose your own adventure approaches so, the idea was transparency so you could choose what level of tolerance you have on potentially flagged content, and there could be advertisers that actually see the roi for something that may go viral that may be controversial, but that does generate more click-throughs, so rather than having a one-size-fits-all, i think the message here is transparency with better information gives control in the hands of advertisers, and i think that's probably the way this is going to have the market choose it will be a competitive market economy. we will find, it will be interesting, on the back end to study which advertisers chose the let it rip approach versus others that took a more conservative, and we'll see whether shareholders reward or penalize based on those judgments. >> sounds like you like what x is doing, anish. >> yeah, the algorithms are

public they've committed to industry standards. does that mean we personally like when elon goes off the rails with tweets that kind of rub us the wrong way i don't think so please don't take my comments as endorsement of some of his behavior, but the actions are very much an engineering, problem-solver mindset, and i wish to celebrate that because we need that to solve problems >> thanks. and a reminder, do not miss an exclusive interview with x ceo linda yaccarino. what to watch as the opening bell on wall street. take a look at the futures dow coming down, but about 13 points up. the s&p 500 looking to open about 5 1/2 points higher. you can get the best of "squawk box" in our daily podcast. we're coming right back. power e*trade makes complex trading easier. react to fast-moving markets with dynamic charting and a futures ladder that lets you place, flatten, or reverse orders

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seems like the dow's rally is a distant memory. our next guest says this is a good but not great environment for equities joining us now is chief investment officer and founder of the multiasset strategy and solutions team at voya investment management. paul, great to have you with us.

as part of the not-great environment yields bank of america had this report out saying thecorrelation between ten-year treasury yields and equities is at the most negative correlation since 2000, meaning yields go up and stocks go down. >> that's actually a good thing because it allows us to hedge our portfolios with bonds. our theme is bonds are viable again. the fact that the correlation is back to more normal is a good thing. but i think about stocks versus bonds, why i say it's good but not great, yields are competitive again so stocks are competition. it's not that stocks themselves are in a bad place it's just that there's more competition now that we have a 4% ten-year note or 8.5% high-yield bond than ten years ago when rates were almost zero. >> what we've seen, you know, apple just yesterday had been on a losing streak. it snapped its longest losing streak it's seen so far this year microsoft and apple are 10% off

their recent record highs just since last -- middle of last month, paul. so, as we see this turn, are you concerned about the overall integrity of the market rally? >> not really. we're due for a pullback we got, you know, stocks go up and down, wiggle around every day, but if you think about the fundamentals and how much we've -- how far we've come from the lows of october or last year, it was so much doom and gloom. fed was going to tighten continuously, we're going to see a 5% ten-year note, we were going to have a recession. none of that has happened and the market's reacted correctly to that so we have had a bit of a run. people were tremendously underweight equities now they're less so, but there's still buyers below this market maybe we get a 10% dip on the s&p, but that should be bought because it's a good environment. growth is slowing. inflation is slowing the fed is probably done tightening earnings have most likely

bottomed in the fourth quarter of last year i would like to look at 12 months running earnings, year over year, and that was down about 5% in the fourth quarter and now they're basically flat so, there's a lot of doom and gloom, a lot of that's been erased, but the fundamentals are still, as i said, good, not great, for stocks. >> any sectors in particular that you like that are better looking in terms of returns and what you can get on a two-year or cd, paul? >> overall stock market, large cap equities as opposed to small cap. there's few reasons for that large cap u.s. growth. large cap stock is still better able to handle the tight labor market, so labor markets are still tight, and so wages are still going to go up large companies have a bit of bargaining power with labor. also, think about the productivity boom that's ahead of us from a.i large companies are probably going to be able to make the investment and use that -- use large language models and things of that nature to improve

productivity and lower labor costs faster than small companies. it's pretty difficult to make and get right, but u.s. stocks, u.s. large cap over foreign stocks is the place to be, and both stocks and bonds are viable here >> all right paul, great to speak with you. thank you. paul zemsky of voya. take a final check on the markets this morning you're looking at the dow up about ten points and nasdaq up about 22 points, s&p 500 up about 5. not as good as where we were >> not as good >> we started about three hours ago. >> maybe double these gains, sort of a small up move. >> could be light. >> you never know. >> you got a big day ahead >> big day in terms of long? >> like a long day but you know what's going to be the hot, hot news when your show is on the air? >> disney earnings, baby >> what does bob iger say? what does he not say about betting, linear, hulu, all of it >> yeah. >> do you know what i'm going to be doing watching you >> oh.

that's nice. >> that's the plan mark your calendars. set your timer >> 5:00. >> do what you got to do before we go, let's show you the ten-year note real quick it hasn't really moved, though i think we're -- it's right there. 4.030. it would be worse if it was 4.666. thank you for hanging out. see you on friday and see you tonight. join us tomorrow "squawk on the street" begins right now. ♪ good wednesday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer, david faber at post nine of the new york stock exchange pretty steady premarket after tuesday's attempt at an afternoon rally. china does slip into deflation for the first time in two years. is that a tell for our own cpi print tomorrow ten-year, 4.02% consumer prices in china falling. big news for one of the world's largest