it's tuesday, september 19th, 2023 and "squawk box" begins right now. good morning welcome to "squawk box" here on cnbc we're live from the nasdaq market site in times square. i'm becky quick with joe kernen and andrew ross sorkin let's see how things are shaping up with the u.s. equities. green arrows across the board. yesterday, all three of the major averages closed up by a couple of points in each case. dow futures this morning indicated up 36. s&p futures up by 6. nasdaq up by 25. quickly, treasury yields yesterday. you had the 2-year treasury above 5% it is still there. 10-year treasury is above 4.3% as well.

the real story has been energy prices let's look at what is happening with wti right now it is at $92.50. yesterday, it closed at the highest level in ten months. check it out right now highest level since november 7th of last year there is bitcoin which is back above 27,000 we noticed this yesterday toward the end of the show. it was trading at these levels higher this morning at $27,319. let's get you updated on the uaw strike shawn fain looking to expand the strikes if the deal is not reached. here is the video he posted on x. >> if we don't make serious progress by noon on friday, september 22nd, more locals will be called on to stand up and join the strike. that will mark more than a week since our first members walked out and that will mark more than

a week of the big three failing to make progress in negotiations toward reaching a deal that does right by our members auto workers have waited long enough to make things right at the big three. we are not waiting around and we are not messing around noon on friday, september 22nd, is a new deadline. >> we will speak to stellantis coo mark stewart today about the state of the strike and negotiations that happens today at 7:40 a.m a first on cnbc interview. you don't want to miss yesterday on msnbc, fain said the battle is not about the president or the former president. former president trump's campaign planning to visit to detroit next week to speak with union members instead of attending the primary debate

i'm not sure which side he's on. i think -- >> he's on the side that can help a populous a corporate? i don't know a uaw strike in 2019 which i don't remember very well >> it must not have lasted long. >> what's the longest -- thank you. what's the longest uaw strike? >> 114 days back in 1940 >> seven years 1954 to 1961 seven-year battle with the kohler corporation. >> it was 114 days i don't know if it was this. >> a fine point. >> existing -- >> a couple of weeks and there's s seven years. >> with the company that no longer makes automobiles

>> i don't know what -- kohler is a heating and air conditioning company >> was it an auto parts company? >> i don't know why they were striking class warfare. followed four years of legal skim -- skirmishinges. it was in cheboygan. they make kitchen and bath fixtures kohler i don't take any satisfaction in it i hope everybody gets something of what they want. it has been a long time. it has been -- i can't look away from it. if it is more widespread on friday, a lot of political

implications for it a lot of things under the surface. >> auto companies are in a unique situation with the unions which agreed tie cuts in 2007. this is indicative of what is happening with labor around the country. hollywood strikes. i don't know if you have seen doctors in california at kaiser authorize 98% for a strike if they don't reach a settlement. it is hitting into industries that did not before and into professions it did not before. that follows u.p.s. and a lot of industries this is, again, one of the problems with inflation when wage increases don't keep up with price inflation >> "time" magazine says 1954 to 1965 they say 11 years. i think more classically 113

days >> 1955 to 1956. in the '40s or '50s. i have to look to see. it was a long time ago the longest in modern history has been shorter it was only three and a half months shorter thanthe writers on strike now >> we haven't seen unions with this type of moxy in a while the kind of comments from shawn fain >> the commentary from shawn fain is what harry wilson was talking about. he has now made it an act of god situation. >> biblical passages >> i actually think the rhetoric from them is the same from the writers. >> "the nanny. >> no. the writers. >> they have been on strike for a lot longer you are starting to see -- >> i'll bet money this ends sooner than the writers does

absolutely >> it's an an easier fix >> this is all about the money obviously. >> not just the money. >> look at where executive comp has gone during the period >> if they go back to 32-hour workweek and shawn talked about if they come up on the money, it is not go to satisfy them. >> jim farley says it equates to $300,000 a year. let's talk instacart making the public debut today. last night, the company priced the ipo at the top end of the range. leslie picker is joining us with more good morning >> good morning, joe this is a company that is used to dlifelivering groceries. pricing the ipo at the boosted

range giving the valuation of $9.9 billion it has been a long road for the company which filed an s-1 six mo months ago it is still raising more than $423 million from the offering selling shareholders will get $237 million instacart is going public at less than four times the sales in 2021, the multiple was ten times. inn t sta -- instacart faces competition from others in the space. we woill see how they size up

against the profitable company when they start trading six hours from now >> are you a user? >> i'm a new user. i tried during the pandemic and could not get a time slot. >> i don't use these people. i do my own checkout i go the other way i not only go to the store almost every day, but do my own checkouts and load my own bags do you use it? >> i use it. i had instacart plus, it was free through the american express platinum card. >> is there a super duper? >> i stopped using it. i had too many problems. you put an order in and they cancel it on you or you ask for

six items and they give you three. they are using a random person to go out and get it and they don't know what the true inventory is at the supermarket on that given day. >> it is the same thing with the services at target you never have aninventory it is moving as it goes. >> leslie, when you look at the growth piece of the story, there is a question mark about the core business and whether that is not continuing to grow at the pace they want, but how connected are those pieces ultimately to the advertising piece and to the enterprise piece powered to the open-table style business behind the secene for other markets? >> the gt that is taking place

on the platform is growing at 4% which is well below the revenue of 31% the reason behind that is because there's so much growth in advertising which is something the company has been pivoting toward with the revenue and diversifying away from just purely being a delivery service. obviously, those go hand-in-hand if people are not checking out, then advertising is not there for you. it is not as important and not as much of a growth driver they go hand-in-hand advertising coming off the smaller base impact on revenue is strong. there are questions about the overall competitive dynamic for the app and platform and uses as a delivery service >> were using something. >> i used instacart and fresh direct. >> something else. >> a lot

target has the shoppers. >> i see the trucks around i remember during the pandemic, i was wiping down. >> the grocer delivery guy delivers food to the restaurants here they pivoted with nobody eating in restaurants i have a lot of services i use they are all helpful >> strange times programming note we will have an interview out with the instacart ceo out today. >> we will speak with alexis ohanian. he was oneof the investors which will make money at this pricing. some later ones will not they will be under water with this pricing. >> is he selling is he part of the selling group? there are selling shareholders >> a lot of folks selling this morning. coming up, getting ready for tomorrow's federal reserve

decision and former vice president mike pence will join us and he willutneis oli h objectives for china if he is elected president. >> announcer: this cnbc program is sponsored by baird. visit bairddifference.com. rude. who are you? i'm an investor in a fund that helps advance innovative sports tech like this smart fitness mirror. i'm also mr. leg day...1989! anyone can become an agent of innovation with invesco qqq, a fund that gives you access to nasdaq-100 innovations. i go through a lot of pants. before investing carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com. you know doug, ever since switching to workday you've been a real rock star. rock star? what do you know about rock stars? billy idol? i mean where's the skin-tight leather? my shoes are leather.

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kicks off a little bit later today. our next guest says the drama at the meeting won't come from the decision itself since it is 99% they won't do anything, but obviously from the fed forecast. let's bring in kelsy barrow. if i were to write that intro, kelsy, your take is they're done the last one is the last one >> that's correct. we don't expect to be a lot of surprises around the decision itself we know they'll stay on hold everyone will be focused on what they will tproject for next yea. there are two things the fed paying attention to right now. one is the fact that inflation is falling faster than they originally anticipated this is very good news on the other hand, they have to

weigh the fact that growth has been coming in a little bit hotter than expectations when you put those together, inflation is coming down faster and job growth is moderating it is not just about the level, but the speed of deceleration. what we have seen over the last six months is job growth slow from 300,000 to 150,000 and we have seen inflation and core cpi slow from 5% to 2.4% i think that's plenty of progress to keep them on hold and for them to be comfortable saying that this is where we should be staying for a while. >> other people thought that there were troubling details in the inflation report in terms of core and everything else you add in crude and where we might be a month or two or three

months from now. that's not in the core, but it can seep into the core you have been saying this for a while with inflation is -- the fed is doing a better job of harnessing that than people think. is shelter in that, too? >> correct shelter is the category to drive disinflation going forward that core and rate on shelter has come down from increasing at 9% clip to a 5% clip we think that will slow even more you bring up a good point in terms of gasoline. gas prices are on the rise that is creating a wrinkle for central bankers. when we look at the move in gasoline prices, we are thinking about a couple of things one is not just the impact of inflation, but the impact on the consumers. we view the increase of gas as a

tax on the consumer. a consumer which is already squeezed the negative growth effect is a bigger factor than the increase in the headline inflation you will see the other thing to note in the energy inflation basket is commodities and services commodities is the gasoline. on the other hand, the services which is natural gas natural gas prices is 70% lower from last year the impact on the headline cpi calculation is going to be somewhat cushioned by that fact. i think the last thing we do want to think about is what is driving this increase in oil prices is it demand or supply the difference is really important for economists and central bankers. we think it is primarily being driven by supply, not by resilient global economy again, for that reason, we're more focused on the downside

growth impact of higher gasoline rather than the upside inflation impacts. >> is that something that exact point is something every person we had on said is higher oil price a global tax that can dampen global growth or seep into inflation? you think it is deflationary more than inflationary why do you think they will continue to forecast cuts? other people we had on said where we are is 5% on fed funds plus that is where we were before the financial crisis we normalized rates. if they orchestrate a soft landing, which is a big if, why would they cut next year >> i think the soft landing is still a big if i don't think we should be

assuming it is a given we have seen a lot of leading indicators that suggest a hard landing and recession is elevated regardless of soft or hard landing, the fed pauses for a period of time and fine tune policy if you go back to 1995, the soft landing example that everyone likes to look at here, they did cut rates briefly before assessing the landscape and having to hike again what we think the fed is going to signal is that rate cuts are appropriate next year because inflation is going to be falling and as a result, the real policy rate or inflation adjusted policy rate is going to be passively getting tighter unless they do something about it unless they cut. if we don't see recession next year, they will still be expecting rate cuts. that is to keep the real policy rate at a steady restrictive

level at 2% real. >> kelsey, thanks. you didn't make it into the studio today you have gone all out at your home office for "squawk box. that's amazing really important you are in london? okay >> i am in london at the studio. >> looks great >> it really does. it moves around and stuff. it says "squawk box. 30 years, kelsey thank you. coming up, we will talk about the writers strike as they prepare to resume talks. plus, elon musk outlining his vision for x and it could include monthly fees for all users, not just premium subscription blue. "squawk box" is returning after this and we'll talk all about it >> announcer: this cnbc program is sponsored by ibm. ibm. let's create can you trust the results?

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welcome back elon musk says that x, formerly known as twitter, is moving to subscription fees. in the interview with the i israeli prime minister benjamin netanyahu, he said they are moving to a small monthly payment for the x system to combat vast armies of bots he did not say how much a plan would cost users he said it has 550 million monthly users which generate 250 million posts a day. getting rid of bots is one thing, but turning a profit is another. >> what's the number a month

>> what will he charge >> what do you think how much katy perry sold her catalog for. what do-- for what do you think? >> $2. nope >> it may not be enough for me to to do it >> don't you think it will be $5 >> i do. >> i think the issue is he said yesterday, which is if a.i. can start an account, literally start an account and we have to play with the ridiculous games where it says show me the horse upside down and the a.i. can do that >> i flunked some of those tests. >> a.i. can do that. >> find the traffic light. >> the a.i. can do that as well as we can do it if not better. once that is true, and if it is not already true, what could you

possibly do except start charging people money. >> okay. >> that's why i think it's happening. >> you think it is the bots or the advertisers are not there as he said in the past? >> the advertising is another component. i don't think it has anything to do with -- the bot issue and advertising issue are not in the same conversation. >> you think the charge is a fee for everybody would be as little the as 50 cents? $2.99. >> a think the question is -- you know the answer? the answer is whatever american express and mastercard and visa. what is the lowest number you can charge without it costing you? >> if you say it is $5 for the year. >> right >> we're not going to charge you a high monthly fee

>> i assume that's how you do it it could be $1 if it is 30 cents, it is costing too much money to do. >> annualized basis over monthly? >> tell me about katy perry? >> to keep you from being a bot. they may make you do it every month. keep charging you. >> i have a lot of stuff >> tell me about katy perry? mccartney got $1 billion how much did she get $100 million how much would taylor swift be worth? >> a lot >> do we have anything we don't former "squawk" episodes any library of any kind that people would pay for probably what we pay for the monthly twitter? 50 cents seriously.

katy perry $100 million >> more. >> really? i would do that if i were an artist get that in the bank. >> scooter when we come back, congress is running out of time to avert a government shutdown. we will bring you an update on where things stand next. right now as we head to break, let's look at the s&p winners and losers from yesterday. >> announcer: executive edge is sponsored by at&t business next level moments need the next level network. copy that. make a hard left down the alley. network's got you covered. [please confirm requesting back-up.] -changing route. -go. roadblock ahead. ...back up, back up... reverse! reverse!

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good morning welcome back to "squawk box. we're live from the knnasdaq market site into times square. here is something else to worry about. gop measures to avert a shutdown

battle this week will they or won't they. kevin mccarthy said the bill could be dead on arrival we have punchbowl news network ju jurn journalist with us jake sherman. >> the big problem is the conservatives, andrew, don't want a short-term funding bill to allow more time to get things done they don't want individual spending bills because the level is too high. although mccarthy lowered it significantly. they don't want to wrap all of the individual ones government because they say that is bad governing. mccarthy has limited room. the government shuts down at the

end of the month they have to find a way to fund the government for the year. i'm pessimistic that a deal comes together to be honest with you, unlike other shutdowns like in 2013 and 2018 and 2019, there is no unifying things that republicans want to get them out of the shutdown i'm pretty bearish to be honest with you >> once you watch the uaw sdtrik and the strike in hollyhollywoo, this is not a strike, but negotiation. how do you put those two together if a deal is to be had? >> the irony is many of them want border policy and security. this is president biden's weakness is what is going on at the border if they wanted a deal on the border to get out of the shutdown, they could get one now. there is a only a five-seat

majority in the house and large number of republicans who want their way or the highway to the extent that they could get a border deal, it is not acceptable to them in previous times with different legislators available, they could not get out of their way to get that down >> in terms of what mccarthy has to offer in the moment and who will be to blame if something like this happens, how do you see the politics of that >> the big thing is senate republicans and senate democrats and the white house all want the same thing a pretty clean government funding process which adheres to the spending deal which mccarthy cut with joe biden back in the negotiations this summer everybody wants that republicans are the only leg of the stool that does not want that what mccarthy has told his

lawmakers where he will say something similar at 9:00 a.m., he will say shutting down the government gives biden the ability to say he is the adult whether they get blamed squarely, we will have to see. that will get blamed what does he have to offer not much hanging over his head, andrew, is the idea they could throw him out as speaker he. if he takes a wrong step, they could schedule a vote on his leadership i'm not saying he can't beat it, he probably can. it is embarrassing one republican said to me yesterday it is unbelievable house republicans are the only branch of government that is in constant existential argument of the leadership and station in washington >> how does this play into the larger presidential election

we heard from former president trump over the weekend that he would shutdown the government. >> he did shutdown the government in 2018 and 2019 and folded after 35 days and got nothing. if i were a house republican, i would not pay attention to trump here he was not an effective president with legislation and dealing with congress. something that befuddled him with the four years in office. how does it play into the larger presidential race? ron desantis has been trying to prop up house republicans who are opposed to mccarthy and say they should fight. that is easy to say. they are on the sidelines. if republicans shutdown the government for any extended period of time, it is bad for them how bad? i don' i don't know it is not a good look. it plays into joe biden's talking points that republicans should not be trusted at the wheel of government. >> i'm assuming those

politicians, elected politician, who are choosing to do this believe their constituents will back them in the pursuit of cutting government costs >> they will they will. that's the problem with congress you have the majority of house republicans who represent deep red districts. the majority are 18 republicans in joe biden's districts those districts are not going to support elongated government shutdown they sent a republican to washington and voted for joe biden. that is the danger for house republicans. >> jake, good to see you we will be following this and hopefully we won't have to >> you will. coming up, starbucks is the latest chain to face a lawsuit over items that aren't as advertised details are next. later, we talk to former richmond fed president jeffery

lacker ahead of the policy meeting. reminder, you can get the best of "squawk box." we have that in the daily podcast. apparently katy perry got 2$2.5 what do you see on the horizon? billion. we'll be right back. whatever you see, at pgim we can help you rise to the challenges of today, when active investing and disciplined risk management are needed most. drawing on deep expertise across the world's public and private markets in pursuit of long-term returns... pgim. our investments shape tomorrow today. ♪ (captivating music) ♪ (♪♪)

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welcome back to "squawk box. look at equity futures at this hour 47 points higher on the dow. s&p looking to open 9 points higher nasdaq opening 31 points higher. we told you about drew barrymore not starting with her debut for the season and bill maher is fwollowing suit. he said one reason he was going to go ahead with the show is because there was no end in sight. maybe now there is an end in sight. >> that is good news if they are making progress. >> i think he expressed empathy for the cause as well while he was -- i would not say folded.

it is tough to be. he does what he wants, but i don't know >> he got skewered so badly. she also was being pillared for the whole thing. right. a judge rejecting the starbucks bid to dismiss the lawsuit over beverages. some of the fruit beverages lack a key ingredient fruit. starbucks says it describes the flavor, as opposed to the ingredient i'm shocked something that is fruit flavor doesn't have fruit in it. cherry flavored. do you think it has cherry >> not when it says flavored. >> right it is kind of like cherry.

>> i thought the story was about changing their cups. did you see that >> no. >> changing their cups sustainability drive the i conic cups not as iconic they are considering it. i saw that yesterday. when we come back, we will talk to cybersecurity ceo kevin mandia about the crippling attacks on colorox and two vega casinos. reminder, you can watch us any time by going to the cnbc app.

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welcome back, everybody.

fbi director chris wray is relying on the private sector more because it is difficult to discern where criminal see where cesars and mgm casinos, and an attack on clorox that the company says will have an material impact on earnings. a cyber security firm that is a sub sub sid airy of google let's start with the saw seen yos themselves it looks like it was one group that attacked both of them, and they did it in part by impacting employees passwords and ways to

get on to the network. what happened? >> this is a group that has been active, and we get inbound calls from victims all the time. what happened is basically social engineering you know, help desks want to help people. when they do that, these folks are calling in and they are doing raouss and guyses, and they will get a one-time password texted to their phones. these folks, meaning the attackers, they are breaking in because they are getting people to trust them. >> that concerns me on a lot of levels, and first of all i will never be able to get help from the help desk again, and is this a situation where mgm and cesars and clorox had bad security, and

this situation is just there >> this group is breaking in and are successful you are looking at the victim companies and say could they have done more every single company could have done more security, and it's hard to pitch a perfect game every day, and i can tell you right now, it's going to change the way help desks works you have to start using facetime or video confirmation of who you are talking to, so you can see the face and understand the person and say, yes, i can reset that password that really is who they say on the other end of the phone. and they will have to change using sms or text messaging as a multifactor as the authentication >> the cat and mouse game

continues. and what christopher wray said yesterday, we are relying more and more on private industry to do that. are we up to the task? >> well, we have to be up to the task, and we are up to the task. this is not anything new in reality. we have a cyber domain that is primarily the private sector, and systemically important entities, and we are trying to defend the nation in the cyber domain >> how much worse is it than it used to be clorox just coming out this week and saying this is going to be a material impact. we don't know how big but we need to start letting you know this is an issue >> well, there's more threat actors and break ins, and we are

getting better on defense. the challenge in why you hear about it, over the last few decades, 20 years ago if somebody broke in, there was some impact, and today based on technology, when there's a cyber intrusion, it's far more grave and impactful on our businesses and people defense is getting better, and unfortunately so is offense. >> i know this is an issue in a lot of board rooms, and this is a discussion that comes up as one of the biggest concerns. you said no matter what happens you can never pitch a perfect game does that mean how much you are spending, it will not be enough. the best is what can you do? >> when you have a modern cyber defense, what i mean by you can't pitch a perfect game, is prevention does fail over time, and people don't like to hear

that but you have to prepare for that you assume on defense that your help desk will get socially know engineered and provide a password to somebody else. it has been proven for the last 25 years, and there was something called zero day attacks. we have responded to 63 year to date and that's three to four times than the norm. attackers need zero days now to break in, meaning we are shutting the front doors to our networks the bad thing is the beach heads are still available, because we are all adopting technology faster than our means to secure it >> if this happens to a company, i know the phraseology that

everybody uses, you don't negotiate with terrorists and you don't pay the ransom, and if you don't you are talking about not getting your system back what do you tell companies >> we don't opine whether you should pay or not. i have never won a ceo that says, boy, we are going to pay this nobody wants to pay it let's start with that. that's the default answer, and a lot of the infrusions, there's not a ransom, but it's for power and just for the destruction >> oh, boy thank you. we appreciate your time, even though it may make us more nervous around the fray.

richard fisher is joining us, and then alexis ohanian will join us. "squawk box" is coming right back

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♪ good morning, and welcome back to "squawk box" here on cnbc i am andrew ross sorkin along with becky quick and joe kernen. we have a whole bunch of things going on this hour, and some green arrows this morning. at least for now about 30 points higher on the dow. the s&p higher as well, and we will see, we have instacart's ipo, and we will look at the treasuries, and we are over 5 on the two-year we have the results of cnbc's fed survey, and steve liesman joins us with the

details. >> good morning, becky it's like, hut, hut, hold. if you know the football phrase there. and the fed is likely done hiking rates and is holding rates above 5% and 93% say the fed leaves rates unchanged this week, and then there's a debate, 63% versus 37, hold versus hike in november, which is mirrors where the futures market is priced then they say the debate about a cut comes in june where the first plurality is 49 versus 45 in june. this is a meeting where the fed should clearly transition the message from how high rates will go compared to how long they will sta that the

inflation rate comes down. it means the real rate doesn't move the result is the fed maintains a highly restrictive rate for sometime robert fry, an economists writes, with an auto workers strike and gasoline approaching $4 a gallon, we could go to declining economic abg tv tea in the fourth quarter the trouble for the fed and economists is the unexpected strength of the economy so far made that difficult to gain where policy should go we asked folks what mistakes you have been making over the past year you can see here, look at the percentage who underestimated the strength of the labor market, 69%. 59% underestimated the strength

of consumer spending there was the excess household savings. they think they had the inflation dynamic more or less right, and 11% underestimated the impact of fed rate hikes, and 59% thought they would be stronger 67% think the lags of the monetary policy are still to hit the economy in the month ahead, an craziest question i know you had 9.7 months what was the median?

>> i would have to call up the spreadsheet, becky, and it's not in front of me i will get you that answer in the 8:30 hour. don't have it in front of me i'm sorry. >> that's okay that's what i am interested in, where do people come down on this i think that would be the toughest question. >> i do want to look at the fed funds futures market, and by the way, it's very much in line here if you look at the futures market, it's 42-41 it's not a market-based survey, but it mirrors where the market is this idea that the fed gets enough confidence in the beginning rates

then there is the problem -- you spoke about this with your guest in the last hour, and you will talk about this with jeff fisher coming up. what happens, becky, if inflation comes down and the fed rate remains the same, they get relatively tighter on a real rate basis, so they will have to make an adjustment over time, or they are pressing down too hard on the economy they will have to do that. yet they will have to sell it as not an easing of policy but like a tweeting of policy >> yeah, like using your brakes. if you leave it on, you stop, you know what i mean you tap them and then you get to the speed -- yeah, okay. thanks, steve. >> joe, sorry. >> for more on the fed and the central banks path, let's bring in the former dallas -- richard, do that again.

is that for the cowboys? >> the cowboys are great >> jerry jones, he puts his head in his pillow every night and screams when they don't win the super bowl the team is 2-0 after a dominant win against the giants and the jets the giants -- come on. just below, coach prime, you know who colorado plays this week oregon in eugene, and 58 points -- my condolences to you. >> in advance, thanks. >> rutgers is going to the big house for homecoming, going to michigan >> jerry jones is a personal friend >> he is >> he is a remarkable businessman. >> and a pretty good team owner. >> he is >> he's letting the team call the plays --

>> did he go through therapy -- >> is this a good thing? >> he is letting the coaches call the plays >>shelter is coming down, and last rate hike is in and done and they will cut probably next year you probably don't agree with any of that, do you? >> it's a reasonable scenario, but i am not sure it's likely. >> what do you see that makes you think differently? >> we have enormous fiscal stimulus in the economy. that's a plus and the minus. the minus is it runs up the

costs. joe, the last 11 months we have been incurring $644 billion in debt payments, interest payments the defense budget is $692 billion. we have $23 trillion in debt now. the average cost to carry will be 5% between the short and the ten-year you can do the math. that's a lot of interest being carried. the stimulus comes from that the problem is, and it's inflationary in many ways, and it pumps up the economy, but we are spending a fortune on interest, $2 billion a day on interest the good news is we are in better shape than everybody else, and the money is come into the united states. we still have a strong dollar. there's very attractive things about what we are doing, even

though we are running up the huge deficits, and congress is dysfunctional, et cetera, et cetera, and we are still the best place to be of course, within the united states, texas is the best place to be, but we won't talk about that >> i see these crazy polls that says texas is dead last because of -- i don't know depends on what question you put in the polls >> dallas fed just released data >> you don't educate your kids -- >> well, nobody educates their kids anymore is any of the criticism warranted for teachers unions, andrew why is there so much animus directed at teachers -- can we ask her that >> i think we can. the results don't -- the answer is it's very result oriented you can see the results.

they are not good. on the other end, one of the reasons we are having her on to talk about the movement towards labor in this country, and what you are looking at with the uaw. by the way, the uaw, you can look at the results. they come out quarterly. it's clear what the results of their work is. >> we're still playing catchup, joe, to the fact that people are earning less than the inflation rate now they are making up for that in spades. >> which adds to the inflation >> right only 10% of our workers in america are unionized. >> i thought it was 7% >> yeah, they are having trouble finding skilled workers. >> so they are not going to be

happy until there is a recession? >> this is the most long-predicted table recession -- >> yeah, now it's back on the table. >> you have to give powell and the fed credit here, and they made a mistake on the transitory information, and the economy has not tanked, and inflation is coming down. the core rate is still high. >> maybe it was transitory >> well, it was only transitory because of the fed >> well, everything is transitory >> i am transitory, i won't be here forever, fortunately for you guys the other thing steve was mentioning was the futures they never have been right, ever it's never a good predicted

mechanism, except just before a meeting. >> what is >> remember, i am a texan, so if you put a gun to my head, i would say you have to look at the employment data. if i have to pick one variable -- >> are you looking -- when you say the employment -- >> when you have a job, you consume -- right now we are in pretty healthy shape people are still holding on -- big companies are laying people off. again, if you look at the small and medium-sized companies, the men and women that build our economy and create jobs, they are still holding on to their employees. why? because demand is still there, at least on the consumption side we will see. once that gets released, when they start laying people off, then we see a weakening of the

economy. >> you think that is still coming >> dallas looked good early on before what have they done to fill in the missing things for later >> we have great talent. >> for defense, too? >> yeah, we have big boys for defense. >> you found big guys in texas >> we have a coach that is -- >> he's an analyst richard, thank you how is your son? >> he's killing it his company created the deepfakes -- >> great, so we can thank him for that >> they are protecting the actors, and tom hanks invested in his firm -- >> no way. the real tom hanks >> but not tom cruise yet? >> no, i don't think that's going to work. >> does he not like -- what does

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when you stream on the xfinity 10g network. welcome back to "squawk box. america, well, it's on strike. three major unions in the united states on picket lines joining us is joann, and we are

talking about this sort of shift in power as it relates to workers. we were just talking as it was about what is happening in the economy and frankly how workers have not kept up with the rate of inflation and therefore are now asking for more. the question i think we are all trying to get to is what is an equilibrium look like? are we going to be seeing many more strikes like this are you seeing this as an ident idiosyncratic issue? >> no, i think we are at an inflexion point right now looking at the future of work. it's not just about the wages, though you are correct there's a widening gap between those at the top and the rest of the workers. we have seen it with the uaw, for example, and we know on an

inflation adjusted basis, they are looking at the ceos who are all making over $20 million a year this is really important this is about the future of work that has to do with the compensation and also with the working hour and what does the workweek look like what are our expectations from work this all comes out of covid. you have a combination of coming out of the pandemic where office workers had had remote and hybrid opportunities are now being called back to the office, and they are saying wait a second, they are rebelling against it they don't want to be back in five days a week you have that combined with this tight labor market, which means employees have the upper hand. there's a rebalancing, i think, of the workplace i do think it is a larger inflexion point than simply the

previous years that we have seen workers go on strike simply for wages. >> that's the other question, which is in this grand bargain or negotiation between the issue of money versus time, how does that play itself out what do you think becomes more important? this is my own take. i think people still want money even more than the time, but maybe i am wrong >> well, right now people want both, and because the market is tight they are in more of a position to bargain for both i want to point out one thing. let's look, for example, at the four-day workweek idea, and we see a ton of eye rolling for the auto workers asking for the four-day workweek, but in truth you should take it more seriously when you look at the research done. there has been research done first in iceland and then

globally, and they found that productivity has remained the same, and employee happiness skyrocketed and mental health improved as well i think we are going to have to rethink how we look at time in the office i wrote recently, my book, "next," and one of the things i was looking at what a historical overview of how we look at work, and we are coming up on the 100th year anniversary when henry ford rolled the workweek back to five days a week, and if we were to create the workplace from scratch today i don't think it would look like anything like five days and 40 hours a week. that's part of all of the unrest we are seeing. >> you say that, but then there are other leaders and businesses

who are pushing for five days and they want to go back to where we were before do you think they are just not up-to-date with what is going on or do you think we are talking about real estate costs or other costs, or do you believe the structure we set is the way to do it? >> we are going to have individualized solutions there's no one size fits all solutions for industries right now, and it's even geographically there are some areas where people are more likely to want to go back into the office there's also, you know, some demographics for who are in the office or remote will be more positive for example, in terms of remote and hybrid work, we know that you get a larger pool of applicants for those kinds of

jobs, and you have a larger pool that includes more women, more people of color, and more people who are physically or otherwise disabled and able to take advantage of those opportunities. by the way, you see it in the numbers. you were just talking with the fed. you see it inthe numbers and th employment figures in april, we had the largest percentage of women, women of childbearing age, as we say, participating in the workforce historically why? because you have the opportunity for remote or hybrid work at the same time you had the rollback of restrictions from covid which meant the kids could go back to school or daycare. and then there are people crammed in, five people to a one bedroom apartment, that they

want to get out. >> thank you very much after this, we will talk to stellantis' mark stewart and we will talk about the uaw talks in just a minute. "squawk box" will be right back.

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i think instacart is in a great position because they are like the switzerland to work with the other 98% of the grocery -- >> instacart just signed a deal with whole foods for five years, and how is that going to get changed or not will amazon buy them out of the deal what will happen

>> that's a good question for the ceo of instacart, but my fact is on the fact this has been a wake-up call to every other grocer they need to offer this type of service >> that was alexis ohanian talking about a shake-up in the grocer market, and now joining us is the same alexis ohanian. you were right there were so many questions being asked at that point whether or not the whole foods and amazon deal would take out instacart completely, and that's what people thought at the time. that didn't happen what happened? >> it's a humbling scene looking at how much gray hair i have, and that was before the reddit turn around, so so be it

i think going forward we will see so many consumers now making their decision not wondering down an aisle making an impulse buy because of an end cap. >> you were an early investor, and it -- they have been raising the price range, and it values the firm at $10 billion versus the $39 billion it would have been valued at a couple years ago, and there were other investors angry they did not go public at that time, the same time you saw doordash and

airbnb >> well, this is crucial to making the return. i think every company in the space saw a huge bump during covid, because many of us were forced to do shopping online there was a huge premium, and things are coming back down-to-earth. at the end of the day, instacart knows there will be higher margin revenue streams, and i don't want to monday morning quarterback it, and they are going public today and hopefully there will be more to come as a matter of policy we distribute to all of our lps, and it's up to them to choose their venture. me, personally, at the end of the day i am not a public markets investor

i got advice from fred wilson early in my career >> good answer the right answer >> i am trying to stay married another six years. >> the reason i ask, there's a number of big venture capital firms that look like they are selling today as part of this, and a lot of folks say pepsi is coming in and all of the other guys are going out, and how am i supposed to look at that as a long-term play it might have been a good investment ten years ago and this could be the first time people have the opportunity to invest >> that's above my pay grade and we have been holding this investment for a decade, and there's much more of an instinct to say let me get a good chunk

of return on this for waiting so long here in the public markets, we will see i feel confident in the technology they built. this is more than just an app, and i am happy i was able to come here today and look right from six years ago, and every grocer needs to adapt on some part >> the question is being raised today, just like there were questions when you were here in 2017, and today it's doordash that is now having hundreds of thousands -- they added 100,000 nonrestaurant partners, and lot of those are grocery stores, so they are going after the business, too. when inflation is on the rise, if the economy is turning down, will people pay a premium to have somebody shop for their groceries. >> speaking as an individual

user, the value prop of instacart got way more compelling once i had my first kid and now with a 1-month-old at home, and you scroll and say, it's tuesday, let's get tacos, or whether it's an impulse buy or i just need this now, it will have value, and there are needs and will be filled by folks at a price point. >> what is the growth path for this company if the growth issue is the advertising piece or the enterprise piece, where so much of the money has come from, they are all connected, meaning if you are not using -- i, unfortunately, am not using the app nearly as much as i used to. it means i am not an eyeball for the advertising, so you can't sell me more advertising on the enterprise side, it's the larger question mark over this

company? >> i don't have inside information, but the way i think about it and what intrigues me, we talk about advertising, and i was shocked to learn how big of a brand kirkland was instacart has a tremendous relationship with the people buying the groceries and whatever their needs are there's ways they can capture more of that attention and i think increasingly the same way that end cap used to be very valuable in a supermarket, there's prime placement there to show a customer what they need at the right time and a couple taps gets them what they need. there's enduring qualities to that >> in the early realm and you participated in that, what was the valuation? >> i think it was 8 million all told >> it was 13.31 a share, and now

it's over 30 >> you have had a much better tu return, i guess. yeah >> i can't stress it enough. this original pitch, they wrote the code for the app, and he was doing the delivery and the picking of items all by himself. >> and he doesn't drive, so he was taking uber. >> yeah. i re irr -- >> we will distribute all of our shares >> you personally? >> i will probably take some off the table and get my wife -- >> the defensibility, for example, some of these

relationships, like you were talking about the kirkland pw brand, and i would say to myself, could doordash or uber or somebody else go to many or some of these retailers, and there become some kind of auction, and who will become the exclusive provider or will they open it up to other providers thinking they will have more access how defensible are those relationships and how they are using the instacart enterprise side to defend that end? is that an open platform or not? >> it could be there's a tremendous amount of technology that goes into, you know -- to us it feels like somebody showed up with the groceries i ordered, but it takes a lot more to guide people around the store and managing

the inventory, and update that, and this is a low margin business but built on software from the very start, which, obviously, finds ways -- >> why do you think nobody has bought this company? >> there may have been conversations. that's for the mna folks >> let me ask you about the market overall for ipos, and this is what you wait for, for the ipo market to open up again? is it too soon to say? >> i want to say, yes, but it's too soon to say. we are looking forward to seeing the ipo market open up and get the economy going again, but we are all tempered and uncertain where things are going we will see how instacart does so many people have worked for the last decade, and it's great

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we are talking about golf and all. ua president outlining expanding the strikes if a deal is not reached. phil joins us next >> mark stewart, coo of stellantis where do things stand with negotiations >> we have two plants out at the moment, and we put together a compelling offer last week which was not accepted, including a 20% wage and 21% accumulated over a period, and great provisioning and enhancements to our 401(k) plan, and maintaining our awesome benefits of diamond star top 2% of the nation, and 100% coverage, phil. where are we today back to the table, and we are

working and our committees and sub committees are working every day to resolve issues and we are looking forward to getting this resolved >> you heard them say your last offer is a no-go, and as far as he is considered they have to amp on the pressure on you and general motors and ford. >> at the end of the day, we will work through things and try to find common ground and work in good faith to find that common ground and hopefully we can do that by friday. >> are you prepared for more strikes? >> we have a contingency in place. our key focus is making sure we have our customers covered on the best of our ability, and if somebody has a service need as well >> let's talk about downsizing your footprint in america, and you have 18 facilities and want

to eliminate a number of those there is your plant outside rockford, illinois >> we were very clear with the union and transparent, this is not about job reduction. there's zero job change in the 18 plants. it's about modernizing a lot of those are older and they are in the wrong location in our terms of the ability to get to the customers faster, and zero -- zero changes to the jobs it's part of our 2038 plan, and it's zero carbon footprint, and it's to shrink our space, and we want to reduce our carbon footprint and do our part for the climate. we offered a great solution prior to the contract expiration

last week that would, in fact, take care of preserving the jocks in srel srau dear for the life of the contracts. it was to take care and make sure there are 1,200 folks that want to come back here, and there are good jobs available for them, and we are back at the table discussing that. that was something prior to the negotiation. >> you have more inventory than your competitors, and how long do you expect it to go you don't want to sit here and say we don't have the cars or trucks to sell, and how long in your heart do you believe this strike goes? >> we are hoping it gets resolved super quickly, and that's why we are at the table, and we were at solidarity house yesterday and we want to resolve it quickly, phil >> in terms of the inventory, you have that inventory pretty

extensive, correct >> we want to make sure we have our customers covered. through the whole process, it's important that we take care of our folks and our customers. >> guys, the next deadline we are all watching and he's involved in it is what happens at friday at noon when shawn feign says they will announce more strikes coming up, disney stock down over a 52-week period. the company looking to get investors back onboard with an update on its theme parks. in the next hour, mike pence is going to be our guest. all that and more as "squawk box" rolls on.

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to do our homework. and that's a good thing? great in my book! who are you? no power? no problem. introducing storm-ready wifi. now you can stay reliably connected through power outages with unlimited cellular data and up to 4 hours of battery back-up to keep you online. only from xfinity. home of the xfinity 10g network. a black bear on the loose inside disney's magic kingdom was apparently caught yesterday afternoon. areal footage showed several representatives from florida fish and wildlife trying to figure out how many people that would take to carry the bear out in a white tarp, out of the woods. it was unharmed. multiple rides at the magic kingdom were closed around midday, as authorities tried to locate the bear, caught it, unharmed, and then relocated the

bear to an area in ocala national forest. that's a good ending i don't know whether boo-boo, boo-boo was -- >> speaking of bears speaking of bears -- >> that's a good one >> i wish i could tell you i came up with that myself disney stock under pressure since the return of bob iger at the helm it's down about 7% since its return and 22% over the past 52 weeks. today, disney will be giving an update on the health of its theme parks to investors and a number of head winds could be on the minds of investors joining us right now, tom rogers, former nbc cable president, and cnbc contributor. you want to talk theme parks i think you probably want to talk about everything else, frankly. >> happy to talk about everything but i mean, disney's luck. you've got investors coming to talk about the parks and a bear show up just to underscore how badly the stock has performed. >> so if you were bob iger, you would do what?

>> well, what bob iger is dealing with is a full plate of deals. he's got to do a hulu deal, an espn partner deal, he's got to do the next charter cable distribution deal. he's got to do a sale of abc deal he's got two union agreements. and all of a sudden, disney's operating performance is secondary to whether or not he can pull off deals, which are out of his control, because you're dealing with other parties who are going to determine what those deals look like and so, it's a very, very tough position to be in right now. i think i would have tried to take some of the focus off the deals and not talk publicly about what i needed to do transactionally before doing it, because i think that has created a grading system for disney that is basically out of their control. >> and creates a conundrum, basically, because if every

buyer knows that there's a problem or a challenge, they're going to take advantage of it. >> absolutely. >> which, the hulu deal is the most obvious of all of them, but in terms of ordering of events, is there a way to push some of these transactions out, so you can try to get to a better place first. >> well, i think that would have been the smart thing to do i think having put them so front and center, i think they've created a lot of immediacy in terms of expectation, what they're going to do. you've seen all the rumors about suitors for abc. abc is complicated, because abc is tied to espn in terms of how you are going to bid for rights, where broadcast distribution is still very important abc is still tied to hulu in terms of the flow of programming to hulu. so doing all of this kind of in public, where there's an expectation of immediate transactions really makes it that much more difficult for them to demonstrate for

investors how they're going to succeed. what about an apple? we've always talked for years and years and years, would apple ever want to just buy this whole company? >> i think it's very unlikely. as you know, apple's never done a deal for $3 billion. and here you have a company that is in secular decline. the linear business is not getting better it's probably going to get much worse. and it's very hard for me to see that apple, for purposes of driving a streaming business, would want to get into declining linear assets or theme park business i just think that's highly unrealistic. >> when's the strike going to be over strikes? >> well, talking is better than not talking, and they're beginning to talk now. i think there's a sense of urgency on both sides developing that you can't let the -- this go on in a way that's really going to take out an entire tv

season and that much of the important movie theater calendar time but, these are very tough issues and how to solve them, i don't think anybody yet has come up with a great formula for, but i think people recognize at this point, there is no help. the notion that near-term saving cash is a good thing for these companies is totally overwhelmed by the downside of the strike continuing >> well, that's what i was going to ask you a lot of people have looked at this calendar year and have said, if there's not a deal made, literally, i think in the next two to three weeks, it almost means that whatever production could begin would have to start in 2024. is that how you see the calendar >> yes and i think you end up in a situation where there is some desperation on the part of lesser writers and actors and i

think the prognosis for the traditional business which all of these legacy companies need to fund their forays into streaming is just going to begin to dissipate and make it that much harder for the traditional business to support streaming. so i think you've got a lot of pressure on both sides >> barry diller has talked about potentially just the distinction between how all of these production companies or studios, rather, are really not in the same business, anymore and that actually, maybe, some people should frankly break off from the others. what do you think about that >> well, if there was a dynamic there that was really going to lead to a resolution, i think that would make some sense for the traditional media companies, but i think that -- >> who's going to get hurt the most the traditional media companies? >> yes, i think so i think netflix being so cash flow positive at this point, having much more of

international distribution capability that's outside the purview of the unions, having that much more that they have already completed, having that much more that people haven't seen, that they have the ability to promote, having a ton of acquired programming if you took all of the original programm ming off of netflix skand just required on their license for programming, they would still be the most viewed streaming service. they have a very different position than the others >> tom rogers, thank you >> thanks for having me. great to be back in the studio >> good to see you when we come back, the wharton school's jeremy siegal will join us ahead of the fed's two-day policy meeting on what to expect and why he says markets still have room to run this year. plus, republican presidentialcandidate and former vice president mike pence out with his policy plan to tackle u.s./china relations. we will talk to him ainn interview you don't want to miss "squawk box" will be right back. g each other rock stars?

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(marquis) so our customers get what they want, when they want it. (jen) it's not just a network. it's enterprise intelligence. (vo) learn more. it's your vision, it's your verizon. good morning u.s. central bankers getting set for their latest interest rate decision it's one of the fed's latest two-day meetings meanwhile, a new ultimatum from the head of the united autoworkers, he says expect more on the picket lines by the end of the week, if negotiations don't make progress. and suddenly, the ipo market seems healthy. instacart expected to make its debut today. we'll bring you details straight ahead as the final hour of

"squawk box" begins right now. good morning and welcome back to "squawk box" here on cnbc, live from the nasdaq market site in times square. i'm joe kernan along with becky quick and andrew ross sorkin seems like we're always either on the where we're waiting for the next day to do something or on the day the fed is going to do something >> or on a jobs report day >> but man, the fed, a big part of our life and that's what we're going to be talking about quite a bit more expected to have no hike tomorrow, but the outlook will be noteworthy, however jay powell characterizes the current state of the economy and what's going to happen with interest rates. u.s. equity futures are, i don't know if you would say in a wait-and-see mode. it was interesting yesterday,

because weren't they lower most of the morning >> they were higher, but then lost it. >> but then they were up 100 points but then it closed up single digits, i think, the dow but the douw doesn't -- >> all were up single digits >> treasury yields this morning, maybe that makes a difference. also, oil, i think we should show, five-year is at -- two-year at 5.06, and the ten-year, 3.02 and there's oil, which i think was up even more than that earlier, but $93 the gas prices are probably going to be $4 pretty soon around most of the country it is, i think, in new york, $4.40 or something already and california, over $5, but for the rest of the country, i think it's about $3.85 here's some of the top business stories that we're watching. ford, gm, and stellantis, autoworkers striking for a fifth day today. in a video posted online last night, uaw president sean fein

said more workers would walk off the job midday friday if, in his words, serious progress isn't made, negotiating with the big three. we spoke with the chief operating officer of stellantis a few minutes ago, and here's what he had to say >> i think in the coming days, we'll continue to sit at the table, work through things, try to find the common ground, and work super diligently in good faith to find that common ground and i hope we're able to do that by friday. >> what do we think of four days -- you're raising your hand >> longer days >> philosophically, i think it's ludicrous. but then you don't have to twist my arm >> a hundred years ago, the five-day workweek was crazy. >> it was seven days >> but you get paid for four -- you work four and get paid for five it's never going to happen to us because those greedy new york stock exchange specialists will never give away their -- that will never happen. they want to go to 24-hour

trading with us here like insane. it will never happen to us it will never happen for you at "the new york times" ever, because news happens >> seven days a week but here's the thing, this machine -- >> but talk me into it i'm ready to be convinced that four-day -- i would love three-day weekends >> we now have these machines which as steve jobs used to say, which are like bicycles for the mind >> i don't want to work at home with my machine, i want to be off. >> but if it's a bicycle for your mind and you can go so much faster than you could on your own, you have to sort of say to yourself, at some point that we should be taking advantage of that >> number one, i would rather have a motorized bikes than a regular bicycle. >> these are like porsches for your brain >> you can do four -- >> i'm going to work seven days a week for the rest of my life take me out of it. >> but your letting other people work four days >> if they would like to, sure

my version of enjoyment is very different than a lot of other people >> i know, you have a version of enjoyment? >> i like to work. i enjoy working. >> you'll work four days, no problemo >> yeah, look, i can understand -- >> you know it's never going to happen >> it's never going to happen here, that much i understand i do understand why other people would like to do that. and if you can stretch, particularly in some industries, where you're an hourly worker, if you can stretch it so you have four days and you're working ten hours instead of eight, that makes sense, too >> they're not saying that, they're saying a 32-hour workweek >> i know, but look, i think life is different, as we've talked about, the commute is tough for people, you have people who can manage their lives differently and i think a four-day, 40-hour -- >> you think that we really are going to have a fundamental re-examination of the work -- >> i think it's going to be different for different people we have seen an evolution. i don't think it's going to change as rapidly as it did during the pandemic, but yeah. >> there's no way i'm doubling my workweek to 32 hours.

there's no way that's what i'm going to tell you right now. no way i'm going to work twice as much. >> it would be less than twice as much for you. meantime, we've got some other news for you this morning. ftx said debtors are now suing the parents of sam bankman-fried saying they misappropriated millions of dollars to their involvement in the plaintiff's business they argue that they exploited their access and influence within the ftx empire to enrich themselves at the expense of debtors. he says sbf's parents were very much involved in the business, contrary to what their son has claimed. the trial of sbf beginning next month. the fed's latest policy meeting begins today, as we've talked about our next guest says that he sees no rate hike tomorrow, but he does expect a pretty hawkish summary of economic projections, or the dot plot. i want to bring in jeremy siegel he's the professor emeritus of finance at the wharton school of business and jeremy, let's just talk

about this even if they're hawkish in their commentary, you don't really think that they should or very likely will raise rates again, is that right? >> well, there's certainly a lot of uncertainties with the strike, with the shutdown of the government and actually, political calculations, you know, is one increase or two increases, is that the straw that's going to break the camel's back you know, i really think that the political calculus is that they should not raise again. i mean, if you had asked the american public, the average worker, do you want to squeeze a point or two off of super core inflation, you know, which is what jay powell looks at now, over the next two years, or do you want 1.5 million to 2 million more unemployed, i think they would say, hey, listen, i

don't want any recession so, you know, but they're going to -- they have to talk hawkish, being the central bank i think they're going to see the dot plot being hawkish i think they're going to push those rate cuts, you know, back down they don't know when that really is going to happen people think, oh, they have an idea about, you know, what the economy is going to look like in 2024 they really don't. but you know, given the strength of the economy, and that's what the stock market loves you know, that's why even when we have a slightly hotter ppi, slightly hotter cpi, if we've got good, you know, real economic data in there, you can see the stock market rally and that's why i think we could still have a firm, not a surging, but a firm equity market through the end of the year >> if there are some people who think that they're going to have to cut rates sooner rather than later, later this year, early next year, if that's the case, though, versus the nine or ten months that most people are anticipating that these rates

will stay at these levels, it's going to be because something bad happened the economy looks worse than anticipated. there's a credit problem, something blows up in the banking system unemployment drops more rapidly. would you agree with that assessment, at least that if we get lower rates sooner, it's not going to be because it's a good scenario >> absolutely. really, i think the only thing that is going to really push them no lower rates is that unemployment rate going up, a big slowing in the employment picture, heading into an election year. wow, think about the impact of a recession and what's going to happen politically in 2024 i mean, that has to come front and center and by the way, as we all know, the fed has a dual mandate it has a mandate for employment and inflation and one is not above the other. where they only have that inflation -- mandate >> most fed heads will get

around that by saying, yes, we have two mandates, but if you take take care of the first mandate, which is inflation management, then your second mandate can't be taken care of either it goes hand in dpglove -- >> that's what powell is saying. it's a question of time. do you really want to slam the economy to get that core rate down to 2 really quickly it's going to go down 2. so if it takes another six months, another year, you know, again, it's all a matter of trade-offs and by the way, you know, as we all know, you know, are they going to get it all the way down to 2 so much debate about even before the recent inflation, about given the low interest rates that we've had, you may want it at 3% inflation target that's not going to be mentioned by powell or the fed they can't discuss that during this disinflationary period. but the question is, is it going to drive it all the way down to

2? in the meantime -- >> let me just ask you really quickly, because we're almost out of time. we've spent a lot of time talking about the fed, how do you feel about the markets overall? is this a market that you would tell people to invest into do the levels seem expensive, or does it seem like a fair price >> absolutely. you're 1 times the next 12 months' earnings and to me, that's a really good deal that's over 5% after inflation as a long-term return. after inflation. and you know, you buy tips bonds, you get less than 2% after inflation. and that margin, if you're a long-term investor, is going to be a very healthy margin to build well over the long run >> okay. we'll leave it on that optimistic note today. professor siegal, thank you. >> thank you >> okay, coming up next, former vice president mike pence is going to join us live to talk about china and how he'd handle tech and diplomatic tensions with that country as president and then later, top bank analyst

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former vice president and current presidential candidate mike pence talking china, delivering a foreign policy address last night in which he said china is close to becoming an evil empire and he called for more arm sales to taiwan, severing economic ties with some key chinese industries and banning tiktok in the u.s. former vice president mike pence joins us now mr. vice president, it's good to see you. i see you're jacketless, thank you. thanks for playing along on "squawk box," as you have in the past as well >> thanks, joe great to be back on. >> it's a -- it defines the term frenemy, i think in your view, maybe it doesn't but both china and the united states have things to gain from a continuing relationship, but it is fraught with pitfalls and dangers. so do you take all of that into account when you're trying to figure out a strategy for us

>> well, you bet, it was six years ago, i presented the first major address during our administration to announce we were changing course on china. look, for 20 years, the united states and most of the west kind of bet on increased commerce, increased exchange would result in china moving away from authoritarianism, respecting private property rights. but what our administration recognized is that the the opposite has actually happened china has used its ability to grow its economy in many ways at the expense of the united states workers and become more authoritarian along the way. we changed the national consensus on china, joe, during our administration we not only build up our military, but yesterday, i said we've got to be spending 3.5% of gdp on our military. we've got to modernize our fleet and have a 355-ship navy

everything starts with american strength, especially in the asia pacific. but beyond that, i think we need to move forward with a policy of continuing to limit access to this economy to china and other authoritarian regimes, even while we expand free trade with free nations the truth is, we have literally subsidized growth in china the green agenda here in the united states by the biden administration is literally subsidizing china that makes most of the electorate batteries. i mean, i've got to tell you, you guys have talked a lot about the uaw strike underway, and there's a lot of rhetoric around it, but look, i know the automotive industry, i was governor of indiana, joe i know sean fein, he's from cocomo, indiana, the head of the uaw. i guarantee you one of the things that's driving that strike is bidenomics and their

green energy electric vehicle agenda is good for beijing and bad for detroit and american autoworkers know it. >> and inflation, i think, we keep talking about how that plays into it. the uaw is not getting a wage at this point, given some of the concessions in 2007, during the financial crisis, given the inflation we've seen for the past two or three years. the buying power of the average uaw worker has definitely declined so they've got a point wald you tell apple? what would you tell tesla? what would you tell disney how do broapproach a future youe describing with china when it's such an important trading partner with some of our biggest and most important companies >> well, i would tell them that particularly when it comes to the high-tech sector, yesterday, i said, look, we should end hb-1 visas in the united states in the high-tech sector where

there's national security implications the reality is that global chinese espionage is on the rise, and we've seen far too many chinese nationals in this country be a part of that massive avalanche of sp intellectual property theft that's taken place, especially in our tech sector we've got to put our national security first but at the end of the day, remember that phase i trade deal, joe? we imposed $250 billion in tariffs on china, and frankly they came to the table almost overnight. now, i think president biden is has largely dropped the ball o enforcing the phase i trade deal that we negotiated, agricultural products, automotive products, manufactured goods, but i think we demonstrated that if we committed to a strong national defense, making sure that we have the strength to not only defend our nation, but see to our treaty interests and

challenge china's ongoing efforts to engage in military provocations that actually interfere with freeman navigation, combine that with using access to the american economy and china will come to the table. and i believe it's also the best way to encourage china to literally move away from trade abuses, intellectual property theft, and ultimately bring pressure on china to end the human rights abuses against muslim, uighurs, christian, pastors, and others in their own country. we're the most powerful economy in the world we're the most powerful military in the world we ought to use american strength as a backdrop to encouraging china to move forward into the family of nations. china is not -- china is our rival. china is our economic adversary, but whether china actually becomes our enemy some day, i

think depends on the choices that american leaders make over the next five years. if i'm president of the united states, we're going to lead with strength and we're going to hold china accountable, and we're going to look to expand free trade with free nations around the world. >> vice president pence, you've been getting this message out, trying to reach people, but i'm just looking at the average of national republican primary polls as of september 15th you've got 4.7% of the ratings. is it frustrating that you're not getting more traction? what do you think you need to do to pick up more ground to catch up either with former president trump, with ron desantis, with ramaswamy, nikki haley, what do you do >> becky, you ought to come out to iowa with me some time. i spent most of the last week in iowa we're getting a great turnout, a great response from people and remember, these national polls are kind of irrelevant it's not actually the way we go through the nominating process

we start in iowa, go to new hampshire, nevada comes in, south carolina and i've got to tell you, i really do believe that whatever the polls show today, that come january 15th, when that iowa caucus happens, that republican caucusgoers in iowa, primary voters in new hampshire are going to recognize that different times call for different leadership look, we have got to move our party. we've got to move our country past the failed policies of joe biden, who has weakened this country at home and abroad i see a determination to do that and we're going to continue to work our hearts out to earn the right to be that standard-bearer and bring the country back >> mr. vice president, can we just touch on the union issue? you said somewhat sympathetic to the plight of the uaw. but we're going to have randi weingarten on a little bit later in the show. do you distinguish between private sector joins and public sector unions at this point? the public unions is such a

lightning rod for criticism. what should i ask her? why aren't our kids doing better how would you approach it? what's the problem there >> i would ask randi weingarten why the teachers' unions in this country insisted that we closed school in the fall of 2020 when our administration never advocated for that i remember traveling with the secretary of education to schools around the country in the summer of 2020 in the midst of the pandemic, saying, don't close schools. open your schools back up. and now we have the data of, you know, the harm that was inflicted on kids, particularly in those early education year. >> but in general, why are kids falling behind is the union -- does it help, the teachers' union, does it hurt our kids, does it help teachers >> well, look, the anecdote -- i know this will resonate with your audience. the anecdote to education in america is competition it's one of the reasons why indiana was one of the leading

states on educational choice years ago. we just essentially made it universal. arizona passed universal school choice, iowa the same. look, every parent ought to be able to choose where their kids go to school, private, public, parochial, home-school, teachers' unions have opposed that categorically, but i don't think teachers do. i think teachers know that when we introduce competition and parental choice and education, that all ships rise. public schools and private schools all get better but that's real the anecdote so no question, joe, you make a distinction between public unions and private unions, but i've got to tell you, i think ways happening in detroit, what's happening with the big three is a reflection of the failed economic policies of the biden administration inflation has not been keeping up with wages. and for heaven's sake, this green new deal agenda threatens wall street. this drive toward electric vehicles, driving people away from gasoline-powered vehicles, any autoworker that's paying attention would know that's not

in their long-term interests and i think they've got an opportunity to turn it around. >> let me ask you about that, mr. vice president because are you saying that you will be supporting the union workers that are involved in this fight and strike in detroit? is that ultimately what you're saying you're saying you sympathize with their plight, or are you saying that the automakers have pursued these ev plans, which will make it very hard for them to be profitable, and therefore these employees should not be fighting for more money? which is it? >> look, andrew, it's a great question i am for working americans i am i'm for free enterprise, all right? i think, look, these businesses make their decision, but at the end of the day, the businesses are responding to the heavy hand green new deal agenda of joe biden and the democrats here in washington, d.c. they've been forcing, forcing our automotive industry into these high-priced electric vehicles, and look, i know something about the automotive

industry indiana has got a big footprint in the automotive. as i said, sean fein is from cocomo, indiana, i've known him a long time. the reality is, any union worker out there that is looking at this green new deal agenda as got to know, well, wait a minute, that sure looks like we're going to continue to shut down plants that make gasoline-powered cars and keep buyinging batteries from china >> are you suggesting that the employees ban together and fight against ev vehicles? what are we talking about? unfortunately, that's not the option on the table, if you will they're either fighting for more money or not they want 40% more, car companies want to give them 20% more what do you think is fair? >> well, what i think is driving this, i really do believe this, andrew what is driving this is the fact that we've gone through 16.6%

inflation in the last two and a half years the cost of groceries. gasoline, $92 a barrel just hit yesterday. that hasn't even been factored in gasoline is up 60% people are not keeping up. i hear it everywhere i go across this country, that inflation is waging war on family budgets and i've got to tell you -- >> i think the unions -- the ceos notice, by the way, and the management of these companies are keeping up, right? you go and look at the amount of money they've been making over the past, that's also what's driving this -- >> look, i think that's a very legitimate debate, that ought to happen with shareholders in a publicly traded company. they ought to hold them accountable for all of that, as they do for profits and all of the rest but i just have to tell you, i think these union workers have a tremendous opportunity i know this is going to fall for a lot of people rhetorically along the classic lines of class warfare and we're hearing that rhetoric already but i've got to tell you, these people stepping forward, i think

they can be a voice for working americans everywhere that are living under the failed policies of bidenomics. push back on this green new deal agenda, not only here in washington, but also california that says, in the next decade, they're not even going to allow you to sell a gasoline-powered car. >> at $5.50, a gallon, mr. vice president, you're not even going to be able to fill your gas tank i'm sorry, we've got to go >> guys, like, the biden green new deal agenda is good for beijing, bad for detroit and i think american autoworkers everywhere ought to stand up and push back. >> thank you, mr. vice president. appreciate it. >> thanks, guys. coming up, breaking economic data mlb partners with t-mobile to not only enhance the fan experience, but to advance how the game is played. aaa relies on t-mobile's network to stay connected nationwide, so they can help get their members back on the road. and we're helping pano ai innovate,

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morning. august read on housing starts and permits. we're expecting the number on starts around 1.44 million, 1,283,000 a big double-digit percentage miss, down over 11% from last month, and this represents the lowest month-over-month rate of seasonally adjusted starts since june of 2020 on the permit side, a completely different story. permits are up nearly 7%

1,543,000 seasonally adjusted annualized rate. we were expecting a number around 1.4 million that is the best rate month-over-month on permits since october. so we really are seeing a disparity here, and one of the main reasons, of course, are all of the supply/demand issues, especially on the existing side. permits looking forward, offering some optimism in a very tight housing market "squawk box" will return after a short break.

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the fed kicking off its latest two-day policy meeting today. central bankers widely expected to hold rates steady, but investors will be watching and listening closely for any hints about future rate moves and much more joining us right now, former richmond fed president, jeffrey lacquer. let's talk through what you think is going to be discussed at the table, what you would be talking about if you were there today. >> well, they have to be happy with the inflation numbers they got in june and july, although august wasn't as good as it could have been. they've had moderating inflation expectations they've had a labor market that's been cooling at a

comfortably gradual pace but at the same time, i think they have to be worried about whether june and july represented transitory good luck the housing market has been firming for several month. i haven't looked at this morning's numbers yet, but it's been on an upward trend. prices and starts putting pressure on resource utilization. there's a big pipeline of medical cost increases that are going to hit the cpi later this year and that will pass through to higher inflation numbers on the core side. and they've got to look at wage inflation being too high relative to 2% inflation rate. and so, i think they're going to be worried that they need to -- they might need to do more they might need to keep up the pressure so i don't expect them to send any overt signal that they're done for this cycle. i don't see the upside in that for them there were 12 dots above the current fed funds rate last

time i think there'll be less this time some people have moved into the no further rate increase camp. but i suspect that there'll be a number of dots above that. and i think they'll -- i think powell will try to leave the door open for further rate increases. >> would you be feeling pretty comfortable right now if you were at that table, though, just thinking that things are looking better, or is that the time you start to worry about what could happen next, what other -- what's the next shoe to drop whether there's issues in the credit market. and by the way, add to the list of thing you were talking about being potentially inflationary, you have the uaw on strike what's that going to mean for a auto prices, which was a big component coming down. and oil prices moving up once again, too so gasoline had been another issue that had been saving us on the inflation front, lower prices earlier this year >> i think you're right that union wage settlements and oil prices represent upside inflation pressures, risk. i would also add to that that the fiscal situation looks to

add substantial pressure going forward, as well that's going to drive up what's called the neutral real interest rate it's going to mean that a higher real rate is required to just remain as restrictive as they are. i think they've got to be worried about those risks. even if those aren't realized, they have to worry about the risks that inflation settles in around 3.5 to 4%, not credibly close to their 2% objective. wage gains build that in, and they're sort of stuck in the mud at around 4% in the middle of next year, and they're going to need to keep up pressure >> we had a guest earlier today who suggested, he thinks it's an 80% chance that you're going to see a government shutdown in the next couple of weeks how would that change the picture potentially "pretty ra rapidly? >> the effect on the longer run fiscal and balance would be the first order thing. the second order thing is that, you know, when markets get jittery about the shutdown, the

fed tends to just pause action but they're on pause right now at this meeting, at least, anyway so, i don't see that having a big first order effect on that dimension. >> jeffrey lacquer, thank you very much. >> thanks. all right, coming up, bank analyst mike mayo tells us why he thinks goldman sachs ceo david solomon is safe in his job at least for now but next, the latest on the united autoworkers strike. we'll speak with american federation of teachers president, randieiarn. wngte she's on the picket line herself today. "squawk box" will be right back. "squawk box" will be right back. plp blnext level. (marquis) with a custom private 5g network. (ella) with verizon business, we get more control of production, efficiencies, and greater agility. (marquis) so our customers get what they want,p when they want it. (jen) it's not just a network. it's enterprise intelligence. (vo) learn more. it's your vision,

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every day, businesses everywhere are asking: what is it possible? spy? with comcast business... it is. is it possible to use predictive monitoring to address operations issues? we can help with that. can we provide health care virtually anywhere? we can help with that, too. is it possible to survey foot traffic across all of our locations? yeah! absolutely. with the advanced connectivity and intelligence of global secure networking from comcast business. it's not just possible. it's happening. welcome back to "squawk.

united auto workers president sean fein saying more workers will walk off the job mid-day friday if serious progress isn't made with the big three automakers joining us now, american federation teachers president, randi weingarten she's supporting the uaw and is out on the picket line today in toledo, ohio good morning to you. we've been talking all morning about the power of labor in this particular moment. and i'm just so curious about sort of where you think that power lies right now and when you think about the autoworkers asking for 40%, the automakers basically saying, we'll give you 20, just on a practical base we can get into all of the philosophical other ideas around this, where do you think ultimately this lies and how quickly do you think this gets resolved or not? >> so, look, i'm, you know, every labor leader worth their salt knows that you don't actually opine on what's happening at each other's

bargaining table, because you don't know what's happening at each other's bargaining table. what we're doing is we're supporting the workers and we're supporting the uaw so, what i do know, and you're hearing the no justice, no jeeps line in back of us but what i do know is that in the arc of what's happening in modern times, in 2008, '9, '10, the automakers were about to go under. they got a federal loan and bailout, but the workers actually took it on the chin and they did concession after concession to try to keep the auto industry viable and they did and fast forward to now, what you see is huge profits by the automakers and the workers are saying, we need fairness and we need to have an enduring route to the middle class, which is what

autowork was in the '60s and the 50s. and that's what they're asking for. >> right, randi, let me ask you this, though we are at a moment, and this is something that the automobile makers and management would say, where there's a major transition happening. and during that transition, it may very well be that these companies are not nearly as profitable as theyused to be in fact, you could look at the transition periods before when the company has struggled. we talk about 2008 how much are the workers supposed to care about the long-term viability of the business, and therefore their jobs in that regard. i say that, because some people would look at what happened to the companies in 2008 and say, actually, some of the problems that were generated weren't just financial crisis issues, but embedded issues that were the result of management agreeing to deals with labor that they shouldn't have, years before >> well, that's a big question so let me just say it this way

look at what's happening in both the entertainment industry and the auto industry. look at what's happening in terms of ai. every industrial revolution -- sorry, i'm a social studies teacher, every industrial revolution that has happened not only in the country, but the world, there are winners and there are losers and the workers always seem to be the losers in every one of these transitions. and what president biden has done in terms of giving the auto industry the kind of tax credits and other credits through the inflation reduction act and other things to do that just transition, the workers have to be part of that. they can't be the ones that lose out when frankly, the auto manuf manufacturer ceos are doing very, very well. at every inflection point, if we don't actually change this calculus to make sure that workers in america, people in

america who are the rank and file folks all across america, they want a better life. so i would ask root for the people in america that have a better life, to have this new industrial policy. look at what has happened. manufacturing is coming back to america. made in america is now a thing so let's actually invest in the workers who have actually made these companies more profitable. >> look, i think everybody would like workers and labor to succeed. i don't think that's a question. i think the question i would ask you is, is there some form of a balance, maybe you would way, everything is just so out of whack, everything is so out of balance that in fact they should be making this money, but i'm asking a larger question, which is, how much should the workers consider the staf the business, if you will? >> the workers are the workers by staying as workers in the auto industry are considering this state of the business

i have workers in toledo we represent -- so let me take a step back to say, if you look over the long view, and steve rattner has done these beautiful charts on cnbc and on "morning joe. the workers have been the ones who have lost over all of these years. that's why you see this level of frustration and anger. because i have heard this argument over and over again at every inflection point, and the workers have lost in every inflection point what they're saying now, thank god, is that labor needs to stick together to actually try to make sure there's fairness. no one's actually looking for more than fairness and to basically create a middle class pathway for our families and that's what's happening right now. there is a question. we have no idea 20 years later or 20 years later how ai is going to change things i was in senator schumer's ai forum last week, and you have no

idea what's going to long-term happen if the workers are on the company side, if the workers on the ground level are helping make the work more efficient, that is a win/win situation. but they need to be treated fairly and over the last 20 years, they have lost ground as the ceos have gained ground over the last 20 years, you see wealth in america has been really, really -- it's been really unfair, where 90% of the wealth is in 10% of the hands. >> randi, back to the long-term viability of the u.s. automotive sector, with competition like tesla and, you know, they've got the -- tesla is ahead, much more competitive in terms of being able to produce these vehicles you want the u.s. workers to be able to participate in this new industrialization, the i.r.a. and the ev transition. so that's going to take a lot of

government subsidies i don't know what the green transition is probably -- >> you mean -- >> it's like -- >> you mean the subsidies that tesla -- you mean the subsidies that tesla got in -- >> but fif it turns out that the big three are much less competitive because of rates or whatever, with tesla, is that okay if the government subsidizes these big pay increases, if down the road it's taxpayers that end up getting stuck with whatever it costs to get a 40% pay increase are you okay with that >> look, the government has been subsidizing the oil and gas industry for years >> okay, is that okay to do this again -- that doesn't make this right, though, does it >> what i'm saying is that if you have fairness in the labor market, if you have fairness so that families can actually afford to live in homes in

toledo, if you have fairness in this kind of way, what you're asking a worker to do is deal with everything that the u.s. government and that enterprise and industry should have dealt with for all of these years. what i am saying is that workers need to have a fair shake, and they have not had a fair shake for all these years. they were the ones in the last moment when the auto industry could have lived or died, they're the ones who took concessions. they have a two-tier wage policy what we're saying is that the middle class in america needs to rise >> randi, we want to thank you for joining us this morning. we appreciate your perspective on all of it and hope to talk you very, very soon. >> thanks. when we come back on the other side of this, wells fargo banking analyst mike mayo will join us on his sit-down with the lead directoofr goldman sachs

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goldman sachs c efrmentso david solomon has faced criticism for his headline grabbing deejaying hobby it says it here. does he get criticized for being a disk jockey? >> sometimes >> earlier this month solomon

told cnbc he doesn't recognize the caricature that's been painted of him in the media. our next guest is wells fargo west senior bank analyst mike mayo he recently sat down with the lead director on goldman's board. mayo says he came away concluding that david solomon's job is safe, at least over the medium term. stocks have done okay, mike. a lot of times where there's smoke, there's some fire but you actually have spoken to some people that might have something to do with his long longevity. >> i spoke to the lead director on the board of directors of goldman sachs, effectively david solomon's, the ceo's boss. his nickname is bio. i sat down with him yesterday. he made it very clear that there is no ceo issue at goldman sachs. he said look at the results, the execution and the strategy they're going very well. he said the reputation is still

fine, and the reason i have this is he all but gave a silver medal -- >> you wore the silver medal >> i wore it basically to reflect a metaphor for what the board is giving david solomon. if you have a silver medal for your performance, you're not going anywhere any time soon. >> i believe you i believe him. this wouldn't be the first time in the past where you've had a company totally bark a ceo and then something happens you take it at face value. >> this is my fourth decade doing this if i sit down with the board of directors, i'll been on cnbc every day. no, he's not going anywhere any time soon. to be frank, may have had best in class book value growth over

the past five years, best in class share gains over the last five years their stock has outperform he did recognize mistakes. this is not a gold medal that david solomon is getting the board of directors recognizes they've made mistakes and the board could have done a better job overseeing them he admitted that with regard to consumer lending, with regard to disguarding investments, with regard to accelerating their growth of third party alternatives he owns some of that he also recognized that, yes, goldman sachs has lost some talent that they don't want to lose he also recognize they have lost some talent for some people who disagreed with the approach. he did reaffirm what the ceo said, that the pace of partner turnover is the same as in any other period it's one thing for the ceo to say it but it's another thing for the board or the lead director to reaffirm what the ceo said that's why i met with him. i asked to meet with him earlier this year. this was my first meeting with him in seven years as you know, i go to annual

meetings, i engage with boards that's why i wanted to talk -- i wanted to oversee the overseers. >> mike, you say medium term is the duration you say at least for the medium term, that he's got the job. what does that meantiming wise for you? >> i didn't say it i feel like a ceo needs to earn their job every day just like any other employee having said that, goldman has pivoted and has a plan for like a 15% roe over two to three years and that's two businesses. they have global banking in markets. that's two-thirds. they have wealth and asset management that's one-third that's what goldman sachs is that's their thesis. the lead director, board of directors think they're on that path. >> what do you think medium term is two to three years? >> by the way, this is my interpretation they're saying they're on bath,

their medium term things are on a path. >> i guess the weird part is having to say that when you get into the situation where you have to say that, why are the rumors throughout? it's not every day that the lead director is going to sit down with you and say this guy or this woman has their job still when they start saying things like that, it's because there's stuff out there in the ethos >> i've been one of the people commenting on this when i talk to investors, the question is do the headlines impact reality when i talk to investors, the first item is, is the capital market cycle coming back how much are the regulatory rules going to impact them what is cop going to be? it's like the fourth or fifth item when people might talk about it you shouldn't get to a place where you're talking about this. in my new research from a decade ago, i raised the exact same question, why can't they handle their public purr sewn nah

better >> if you could own a bank today, what bank would you own >> my two top picks, jpmorgan and citigroup. >> that's like a complete barbell. sglp goliath is winning. goldman sachs is a goliath in capital markets. the big three players somewhere done quite well and scale is going to win, especially if the capital market cycle comes back. this is a silver medal for david solomon. >> what's on the other side? >> you had to ask that i got the silver medal at the national power lifting championships on friday. >> power lifting he's got some muscles. >> the silver for david solomon. >> if goldman sachs in the low 200s, it would be a problem.

it's all about the stock performance. it always is people don't care about spinning disks. >> i asked a question -- >> we've got to go >> we found out you're a power lifter we did it. we've gopt ten seconds. >> seven seconds we're only on this earth for the medium term if you think about it "squawk on the street" is next ♪ good tuesday morning welcome to "squawk on the street." i'm carl quintanilla along with jim cramer and david faber the fed meeting begins, potus at the u.n. auto strike in day five. corporate events at intel, disney and others. roadmap begins with the fed watch. the street betting the central bank will stay put >> oil is trading at ten-month highs.