seasonal time of the year. november, december, january, over the last 50 years, it's up 4% in total. or last hundred years, it's up 4% in total, and the odds are even better when it's downgoing dan, we got to thank you. we hope everybody has a great weekend. >> monday's not going to be like this. not this impactful. >> we'll see. >> not as many. >> we'll see. >> who knows? make sure it's spinning out of control. join us monday. "squawk on the street" is next. and on that note, enjoy your weekend. ♪ good friday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer, david faber at post nine of the new york stock exchange. stocks are adding to the best week of the year as october jobs comes in 150,000. that's below almost every estimate with some negative revisions. bond yields are tumbling. our road map begins with the

softening in the job market, u.s. employers scaling back their hiring in october. plus apple's drag, the iphone making posting a quarterly decline. shares a bit lower ahead of the open. and the verdict is in. ftx founder sam bankman-fried is found guilty on all seven criminal counts against him. he's now facing the potential of 115 years. >> oh. >> that's all. just 115. >> all right. consecutive sentence. sure. >> let's get to the jobs number, though. as we said, 150,000. unemployment ticks to 3.9%. average hourly earnings, year on year, is a new cycle low. losses in manufacturing. that's the strike, jim. >> yeah, the strike. i think that health care is back being big again. government being big again. i will say, if you want to go back in the wayback machine to when we just used to have these people come on constantly criticize powell that this

wasn't happening, and remember during the omicron, he was being too lenient, not tight enough. we don't talk about that anymore. we talk about how maybe he's being too con skstrictive, and think he's just right, mr. goldman-sachs. >> you a man who's very self-effacing and doesn't bother to defend himself other than during that weird period with former president trump where trump was saying he should resign or something. >> i forget which period that was. >> it was like a period where everyone had to resign. like when he told me he was going to knock my show off, "mad money," because he had the 6:00 press conference. >> back to the jobs report. >> yeah. >> also the week that we have had in the market so far. do look higher now. >> the week that we had, thursday was a very big day. i spent that with sara. >> i'm aware of who you spent it with. i remember monday, when you came

in, you were debbie downer. >> josh frost spoke. josh frost. he's the man who came up with the schedule that didn't have a plot of 30-year but mostly three to ten-year paper. he's a hero of the american people, an unsung hero. josh frost, "brideshead revisited" kind of guy. >> now you got a softer jobs number. hartnett argues a lot of the street was positioned for ten-year at 5.5%, not 4.5%. >> i know. look, this has been a huge short squeeze week, and it is to our colleague, steve liesman, was talking about a penny stock bond market. look, sometimes things go right. you had to go through a big gauntlet. you had to have the fed say the right thing at the press conference, and i thought that powell handled himself incredibly well. you had to have the treasury issuance schedule, which turned out to be much more benign.

you had to have this number, which turns out to be benign, and you had to have apple, which i will defend in a moment, so you really kind of went four for four, and i don't think people were anticipating that you could go four for four. >> look at the ten-year. i mean, yeah. >> changed back. that's why the housing stocks exploded yesterday. the mortgage rates are going come down. >> they already have this wenger, right? >> it's great. there's a place, 1 wall street court, that has your name on it. >> you're looking at a place for me? i appreciate that. will you buy it for me and just gift it to me? >> no, because i'd get hurt very badly by the gift tax. but i'm telling you, people are going to go back. one of the things i know you follow floor and decor closely, they were talking about how the mortgage rates really hurt them, and what i would say is, okay. that's over. now we're back. how did we get back so quickly? >> listen, we were at 8%. we're now, as you see, down. it's a little early, isn't it,

to say we're back so quickly? >> look, i think that the fed chief would say, could we at least have maybe three more months before we declare victory? he doesn't want to be like a previous fed chief who declared victory and it turned out to be way too soon. >> i'm coming back to that gundlach interview. >> where it could be really good or really bad. >> that number that he used, and again, after druckenmiller earlier that day, the $2 trillion in interest expense because we have 50% of our debt coming due in the next three years, and if rates stay where they are, that's going to -- i mean, there's some scary numbers. there always are. >> thank you. >> always. >> there are always scary numbers, david. they were scary -- can you imagine president lincoln when he got that bill? talk about scary. i mean, lincoln, when he was -- i'll see you at the linc on sunday. i have to tell you, you go back and read churnout or read the ways and means, which is how

lincoln financed it. we have been there. the republic has been there. maybe these guys ought to go to a little history, because the republic is not new to this. >> this is somewhat different market in the 1860s. but yeah. >> i mean, i say our country was a little more challenged then than now, but when i listen to the billionaires -- >> sadly, only perhaps a little more challenged. >> but the billionaires only think this is the worst time ever. maybe when you get to be a billionaire, everything seems to be worse than before you were a billionaire. >> as we've said before, when you are a billionaire, you run out of things you can't fix with money, so you worry about the big stuff. >> you get very frustrated, too, because you're so sure that you know everything because everybody's told you you know everything because you're a billionaire. >> yeah, well, president xi's not really in the billionaire class. >> no. it's hard to keep billionaires humble. some are. >> i think tepper is humble. when you have a team like that, it's humbling. >> yeah. you need somebody to tell you

all the time you're wrong and you have no idea what you're talking about. i try to do that with my source base, and some of them take it well, and others don't. don't talk to me again. >> making light of the fact that everything's going correctly if you own stocks, but you would not feel that way if you listened to a particular class of people who have already made it and don't seem to want to help you, but it's not their job to help you. i understand. look, the debt on the -- the debt's high. >> yeah. >> and there's no way out that we can think of. >> no way we want to make light of $640 billion now and it's already going higher and we have a $2 trillion deficit. >> the pe multiple says we're going to raise corporate taxes very big, the rich are going to have to pay a lot more if president biden is re-elected. these are all in the cards. and anyone who denies it doesn't understand why the pe multiple's really shrunk, which is that the corporate tax is going to be so much higher that the numbers you thought they were going to make next year are going to be much smaller. >> citi brought that up this

week. >> good note by citi. >> jim mentions apple. revenue's down now for four straight quarters, and that's due in part to mac and ipad weakness in china for the holiday quarter. apple says it expects sales to be similar to the year ago period. jim, street's almost at five, so that's what we're looking at today. >> i know -- when i spoke to tim cook with steve kovach before this, the notion of what you hear on that conference call is so different from what we hear. what we hear is that, look, there were some glitches where they -- there was a bulge of how many ipads they sold last year because of a covid issue and the year over year is distorted. there were fewer days this quarter that was barely talked about. the vision pro, the orders, it looks like that the people who are writing for it, it's much more of a b to b product than people thought, which is really a big crack in the apple getting into the b to b, so it could be much larger.

david, there are two apples. there's the apple that i talk to, and there's the apple that's in the grueling, you've got no growth, you buffoons. they leave out buffoons, but it's a subtext. you know when you're watching cartoons, and there's a little, what a buffoon. >> yes. >> well, i want more buffoons. >> right. >> give me more buffoon ceos, please. >> i want to talk for a minute about service. >> you're going to go with the -- >> no, no, i just want -- there's a quote from tim cook about the iphone 15, and remember, the quarters don't match up, and they want to make that point. >> thank you. >> last year, there were seven more days. >> don't forget, the ipad, the mac, and the wearables will, next quarter, be less than the service revenue. when you combine them. >> it's an enormous margin. what should the multiple be? on that revenue number alone, on a yearly basis? >> 26.5? >> you know, that's -- you're

doing $22.5 billion in revenue on services. >> i posited 26.5 to tim, and it was like, jim, we're a tech company, not a bleach company. that kind of thing. he doesn't like to hear that. >> the run rate on that services revenue, which is only -- went up 16%. >> and by the way, you know, they raised the price of apple plus. who cares? when you take -- i don't know if you bought the 15 pro. >> no. >> it's a surprise. i got it for my wife. she doesn't watch the show, i don't care, and i took all the different services. i mean, the services are -- holy cow. the second biggest thing i bought this year. >> it's a plot of services. >> don't tell my wife i bought it. >> as you've said many times, carl, those services come with a very high margin and then get a higher reoccurring multiple, as they potentially should. >> again, on the conference call, no one talks about that. all they do is, woe is me, you haven't grown.

it's true. let's say india takes off. go google the populations that they're doing well in. brazil, turkey, indonesia, the philippines. these are major countries that are doing well. they haven't scratched the surface of india, much younger population, harder to do business. all people focus on is what's going on in shanghai. and i really don't like it. i find the calls demeaning and insulting. >> you mentioned the analysts, goldman today reiterates buy. b of a was on squawk this morning. we remain concerned that weakness across ipad, mac, wearables are a leading indicator of further weakness. >> i think he's a good analyst. >> meaning? you endorse this message? >> no, i switched from nice guy to good. >> i got it. >> if you come on our shows, you don't get nice guy. you get good. they're always nice.

hi. >> i know you want to push aside china, but it's 19% of revenues. it's incredibly important, both for selling and -- >> $2 billion miss in china. >> well, china is perhaps the most challenged country on earth. they've never heard of keynes. >> huawei is back with -- maybe it's not competitive. now, by the way, on the call, cook is saying they took market share. >> yes, he did. they had to because of the vibe is what he said, but what you liked about china is this is how they're doing with the pitiful, helpless giant that china's become. can you imagine if xi actually embraces capitalism and just goes full-bore keynes? which they have to do, judging by the numbers today. >> i'm sure that's going to happen, jim. >> you do? >> what are you talking about? >> he's -- he's likely to meet with the president. comments today from xi about germany -- >> i like what he said about micron.

tariffs, my friend. >> what about that speech about women, though, and their place is potentially in the home? >> well, you know, he's a little out of date there. >> do you think starbucks yesterday was a comment about what apple could be in china? >> starbucks was so -- laxman delivered. >> you had him on last night. >> i'm always very self-referential, but there was amazing numbers out of china, and they want to double china quickly. it's regarded as a treat. we drink like 332 cups of coffee a year, they do 10% of that. david, there are cities with 700,000 people where there's like one starbucks. >> i thought he said no starbucks. >> there are some no starbucks. >> how many do they open every day in the country? >> every hour and a half, you know, there's like -- it's -- >> so there's no end? there's no end? potential demand in the chinese market. >> they need triple the number of starbucks, and by the way, he solved the cold problem.

they got cold. >> they got cold? he solved the cold problem? >> there had been a cold back-up. >> back-up in being able to make -- >> this is a bit of sound >> of cramer's interview? >> the opportunity is really large. we think that we could be over 55,000 stores. we're going to be opening three out of four stores outside of the u.s., but that doesn't take away from the opportunity we have in the u.s. >> he's so good. this consumer packaged goods story. >> did you do that interview in-person? >> i did that. >> nice. >> it's going to go up another ten. the numbers were extraordinary. >> he rings the bell this morning. >> the guy is what i call money. he's consumer packaged goods. you know that from -- >> i remember him, and we had some interesting conversations. >> he's a person in the world. he had 25 homes in 30 years. he's been everywhere in the

world. i think howard schultz picked a great guy, and i think that he also is of the business because he said to me, he wanted to know if i wanted my triple ve venti cappaccino and i said, i switched to cold. >> his son likes "mad money." it's on at 6:00, david. >> i'll make a note of that. when we come back, we'll get the latest on the sam bankman-fried trial, found guilty, as you know, on all counts in that fraud trial. take a look at the premarket. lots of earnings to get to before we wrap up the week. draftkings, qsr, expedia, livenation, skyworks in a minute. te, but if it's using untrusted data can you trust the results? your business doesn't just need ai, it needs the right ai for your business. introducing watsonx a platform designed to multiply output by tailoring ai to your needs. when you watsonx your business, you can train, tune and deploy ai, all with your trusted data.

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federal jury has found sam bankman-fried guilty on all seven counts in the ftx fraud trial. he faces more than a century in prison. kate rooney has been covering the trial since the beginning and even before that. she's here at post nine this morning. kate, that was quick. >> very quick, guys. good to see you here. u.s. attorney called this case and the verdict one of the biggest financial frauds in american history. the verdict coming almost exactly a year after sam bankman-fried's crypto company filed for bankruptcy. he was convicted across the board on seven counts of fraud and conspiracy on lenders, investors, and customers. it was an emotional scene inside that courtroom last night. bankman-fried's father burying his head in his hands.

the defendant, bank bankman-fried, staring straight ahead. the jury came back with a lightning fast decision. they broke for dinner at 6:00 p.m. the verdict came in around 7:45, so about four hours all in. in a news conference, damian williams, the u.s. attorney for the southern district, delivering brief remarks. here's what he said. >> the cryptocurrency industry might be new. the players like sam bankman-fried might be new. this kind of fraud, this kind of corruption is as old as time. and we have no patience for it. >> attorney general merrick garland also weighing in, saying "sam bankman-fried thought he was above the law. today's verdict proves he was wrong. this case should send a clear message to anyone who tries to hide their crimes behind a shiny new inthing." the prosecution presented evidence showing sam bankman-fried knowingly stole money. the defense team saying he

maintains his innocence and will continue to fight the charges against him. no official word on an appeal. >> but we've also got another trial, potentially, in the offing. is that garnuaranteed or likely? >> he faces charges with campaign finance violations. that's expected to come in march. they'll make a decision in february if they're still going to go forward with that. the debate is whether they spend more taxpayer money prosecuting this. some of the interesting stuff we got out of evidence had to do with campaign finance spending and how much he actually gave to, in terms of dark money, some of the political groups that don't necessarily need to disclose who their donors are, we found out through evidence that he was donated about $50 million to those types of groups. i think there's a lot of people who want to see that through and really find out what happened there. >> is there a sense that him taking the stand was a mistake? >> yes. and it was a big risk. the big thing was his credibility. it was his word versus the other

three testimonies that we got, who they had pleaded guilty. so, from the get-go, there was just a ton of evidence, the fact that he had three key insiders testifying was tough. now, i mean, the mistake, it's hard to say, because we'll see the sentencing, but the mistake would be if the judge decides that he perjured himself and it adds years to his sentence. the jury did not find him credible enough to acquit him. >> we don't get sentencing for a while, though. >> march 28. so, got a little while until we find out what the sentencing is, but it's up to the discretion of the judge. >> enjoy your coverage immensely. it does seem like judge kaplan is a strong figure, and people may not realize that judges have different styles. if i didn't know better, i would think that judge kaplan felt that he insulted the court, that he did things that you don't do as a defendant, and therefore, the instructions and the way it was handled, heavily biased against him for the way he conducted himself. >> that was the feeling inside

the courtroom, that judge kaplan seem frustrated at times. he scolded him, really, and said, answer the question. he did a lot of evading, and just wouldn't directly answer yes or no, and that can affect the jury as well. he's seen as this figure of authority. he's been on the bench for decades. that plays into the jury's perception of bankman-fried, and if he's getting scolded and was a little bit scarcastic, especially to the prosecution, the government attorneys, he was kind of talking back to them, and you've got to think that weighed into what the jury was interpreting in terms of his testimony. >> as jim said, kate, great work. >> thanks, guys. >> kate rooney covering the trial for us. we'll get cramer's "mad dash" as we count down to the opening bell. futures close to session highs with the ten-year now below 4.5%. don't go anywhere.

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got some gainers on earnings this morning. expedia is going to up better than 11%. guide was reiterated. they added to the buyback. we'll get to the slew of names from last night that we have not yet mentioned and the opening bell in less than five minutes.

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>> announcer: the opening bell is brought to you by nuveen, a leader in income, alternative, and responsible investing. all right, let's squeeze in a "mad dash" before we get to an opening bell. block. >> do you remember block? the artist formerly known as square. jack dorsey did an absolutely terrific job last night.

the terrific cfo with great commentary. david, this company is back. there's just some -- great ebitda. they're going to buy back stock. they are going to cut head count so they're going to be more efficient. this is the year of efficiency for block too. david, these companies all have to get together. block should merge with affirm, which should merge with upstart, which should merge with paypal. there's too many of these. but this company distinguishes itself with some very good numbers. cashapp doing well. some people think not well enough. i do. ebitda, i know it's adjusted ebitda, which i know always rankles you. >> got to be careful with it, got to be aware of it. >> i do want to point out, david, that this company's stock is up very big, but it's probably going to go up more, because the street always loved it. they love fintech. they can't get enough fintech. >> true. although, again, to be fair, this stock has been far, far off it. i look at a five-year. $200.

>> companies from that era make a comeback. paypal, love the new ceo and love his focus. intuit. >> let's get the opening bell here. at the big board, personal finance company one main. at the nasdaq, it is the ceo of starbucks doing the honors after joining jim last night. as we are above 4,300 this time, jim. >> it is a bit of a short squeeze. remember, it is friday. they have been down because people tend to be worried about what's going to happen over the weekend. and the middle east has weighed heavily. interestingly enough, the only company that really has referenced this was bookings and it should -- in some ways, it just mentioned it kind of like

the other day with estee lauder. there was a piece of research that came out that was just called "uncle," and i don't mean "man from." we had another uncle today. >> have you -- >> i have thrown myself on my sword enough, mr. faber. >> you know what? you're right. >> and i found there's 18 people that watch morning show, not 17. you're way off. >> jim, there's going to be a lot of headlines that say goldilocks. doing this jobs print reflects that? >> yeah. i mean, this is kind of within the confines of knowing that we have too much debt, this is kind -- the slowdown that you want. you still have some growth. the areas where the slowdown are affecting are the areas which are the hottest. i referenced floor and decor, which could hurt home depot in terms of read-through. mortgage rates went up so high, they did cool housing, and we're gipg to see properties for sale. by the way, new york has a lot of approproperties for sale, ant

had been the area that was up 40% since 2019. powell triaying to bring back everything. the costco numbers, the monthlies, show definite not disinflation, but a dramatic slowdown of the inflation, and that matters. >> yeah. global food index is 2.5-year low. >> oh my. i had agco on the other day, david, and one of the reasons why the farm equipment kpacompas are doing so poorly that, hey, prices are down so much in food. and yet, the war in ukraine, which was 13% of our calories in the world, continues to rage. >> it does. >> yes. so, it is -- the price of food has come down dramatically. >> guys, i want to talk about paramount, which also reported numbers after the close yesterday, the stock of which is having a decidedly good morning so far. it is not often that we have seen this kind of surge in shares of this company. of course, it was only a few days ago that this thing had a less than $7 billion market

value. it's now once again well into the 8s, $8.4 billion by my count. why is the stock up? well, better than expected numbers. you came in with expectations that were mighty negative, so defying those expectations in part is one reason why, but the other is they added 2.7 million subs to paramount plus, their direct-to-consumer offering. that was more than anticipated. arpu moving up. that was better than might have been expected. free cash flow, there was $377 million in the quarter. we don't know how much that was benefitted by the fact that they're not spending money. remember, with the strikes on new content. so, some of that is just deferred spending that showed up in a more positive free cash flow number. but it was -- and overall, content marketing spending got tighter. they tightened things up as they have to when you're under the

stress that a lot of these companies are. you've got to tighten up. they did. again, they also said dtc losses will accelerate in the fourth quarter, but overall, for 2023, will be lower than they were for 2022. that was not anticipated. remember, this was supposed to be the peak year, then things were supposed to get a lot better when it comes to losses. but in fact, '22's losses will exceed those of '23, also seen as a positive. jim, overall good. they're tendering for as much as a billion in their debt, which is again something they need to do. dividend's more or less gone. they took in some money, if you remember, in that preferred that they did with the combination of michael dell and that company. but the coast is not clear for these companies. it's a tough road as your linear business continues to decline at a fairly rapid rate. and you really have to cut losses in dtc, but the growth

was good. >> now, why can they have unbelievable sports? they do very well in sports, they have champions league or a good nfl contract, and people don't think, you know what? they've got some prized properties that actually generate some very good ad flow. why are they not talked about? is that because that would only be brought out in some sort of merger that the ftc wouldn't allow? their properties are very strong. >> they have good ip, the way they like to talk about it, although some of it they don't fully own. "mission: impossible," you've got ellison. >> ellison? >> larry ellison's son is a producer. >> every day, it was a tough day for ellison. actually, larry ellison, by the way, oracle is doing quite well. >> oracle is doing very well. on the call, they talked about the deal between charter and disney that we focused on that allows basically for charter to allow its subscribers to access

both the direct-to-consumer ad-supported platforms at the same time. here's what bakish had to say about the deal as it relates to paramount. >> as we go forward, it is possible that some of our partners will embrace a strategy that more tightly integrates dtc in the pay tv bundle. we expect if they do, the bundles would have many of the same advantages we have observed in the various hard bundles we've deployed internationally, namely, a dramatically lower cost of acquisition and improvements in streaming churn, and it may improve tv ecosystem trends as well. >> the idea there being that maybe actually the video business hangs on longer with deals like the charter and disney one that was struck. that's why that was an important deal. >> do you think roku was talked about enough? they're doing a lot of things right. obviously, still not making money, but callier's got there. they seem to have their act together. it's very impressive quarter. >> roku and the stock responded very positively. >> very impressive.

look, i think all of this area is exciting. i'm focused on espn, carl. by the way, espn and penn nat, gambling coming up and thanksgiving. draft kings had a remarkable number. >> didn't you talk to them last night? >> jason robins is doing a lot of things right. they've fasted fanduel. i think it's their app that makes it so th actually making . those are few and far between. >> guys, i want to do a quick update on the sale process of u.s. steel just because i haven't focused on it a bit. >> the original. >> yeah, this is still going, i think, fairly well. there are going to be a lot of site visits coming up for the prospective bidders for u.s. steel, and you would assume they're going to get this thing done by the end of this month. remember, that standstill with cleveland cliffs expires. cleveland cliffs, ursula, you

got new core, stelco, some names, steel dynamics, also potentially, and i picked up another one. there's a big argentine company that has a u.s. subsidiary. they also, i believe, are involved as well. they may not want all of the asset but as much as 90% of it. jim, this looks to be cleveland cliffs to lose because it's a must-have in some ways, but there is not an insignificant amount of continued interest in this asset as this process moves forward into what will be final bids, let's call it, the next couple weeks. >> what does that say about the economy, that you could have such fervent bidding for a steel company, which would be the last thing you would want to do if there's a real downturn? >> it's a unique asset. it's not like it's going to come around again. >> and cleveland-cliffs, i know it's a controversial stock, but

he's paid down a lot of debt. he's doing a lot of things right. the quarter was excellent. initially, the shorts were pressing it down 15. i thought the quarter showed you the power of combination that most people did not believe in. they can pay down debt. their cash flow is incredible. they do own the auto market. i was concerned about a longer-term strike, but they have the firepower to get it and they're a remarkable company. you've got these companies that are out there. no one cares. i mean, cleveland-cliffs is a remarkable resurgence. we're a good steel maker now. new core is the number one in the world, and dare i say that the tariffs worked? you needed to stop the dumping. >> fleurs up 9% or 10%. >> i like this group. i like infrastructure. i think that caterpillar was brought down by bears who were going to be proven to be wrong. caterpillar is now up for three straight days, almost back to where it was when we reported the so-called horrible quarter, which really wasn't. the industrials, ingersoo rand,

david. these companies, we are so back when it comes to the industrials, but people, you know, they'd rather just talk about the weak four days of apple. and the 17 people who watch "the morning show." >> let's get back to the jobs number. we're joined by the acting labor secretary, julie su. madam secretary, great to have you back. we've been over the numbers a few times this morning. is the white house ready to bless a shofter job market if i does ease inflation? >> it's so good to be with you. yeah, today's jobs numbers reveal 150,000 jobs last month, bringing the total since president biden came into office to 14 million. to your point, this is actually something that over a year ago the president said, if we started to transition away from the numbers that we were seeing then, you know, 500,000, to a number closer to 150,000, that would be the sign that we were entering the stage of steady,

stable growth, and that's exactly the number that we're seeing this month. >> got some forecasters this morning saying pretty likely here these numbers get revised lower. every month has been revised lower this year. unemployment maybe cracks 4%. the household survey was pretty weak. i wonder what you make of that. >> well, i would say -- so, we look at the monthly data, which is 150,000, like i said. president biden has said now for over a year that that would be the sign of the kind of economy that we want, moving away from rapid growth post pandemic to steady, stable, strong, sustainable growth. but the other thing is the three-month average, even taking into account the adjustments, is 204,000, so again, signs of a strong economy. at the same time that we continue to see an unemployment rate that is less than 4%. many people predicted we would not get to under 4% for many, many years. president biden beat that, but now, that sustained 21 months of that is the longest stretch in

over 50 years. so, low unemployment with continued job growth, people are in the labor market looking for jobs and getting them. we think these are all good signs of what bidenomics means for the country. >> madam secretary, jim cramer. i'm trying to figure out the impact of the tremendous amount of immigration to the country. i'm not trying to hit the third rail of illegal or legal, but we did have a dearth of new workers for a long time. are you seeing any integration into the workforce, legal aliens actually getting jobs but also making it so that there's a more moderate gain in wages, therefore making it so the fed can one day cut rates rather than raise them? >> yeah, so, i'm glad you mentioned the wage growth. part of the president's approach to this economy is that we can do right by workers at the same time that we benefit employers and grow the economic strength of the country and our competitiveness, and we have

seen wage growth too, nominal wages have gone up. that's especially true for low and middle income individuals, which is about everybody getting a fair share. and i think that tight labor market, which is also not an accident, but a feature of strong economic policies that favor workers, we have seen a need for workers from all across, you know, in every single community, and that includes immigrant communities, and we've also seen a return in terms of immigration since the pandemic. so, all of these things, yes, factor into what we see as an economy where workers do well. >> we watched the president, of course, on the picket lines with the uaw, encouraging the union to stay active. now, the uaw president's talking about going after what he calls the big five or six in the next labor round. would the white house encourage the uaw to start organizing nonunion shops like tesla? >> so, you know, we believe that

the future of the auto industry, especially in this moment where there is transition going on in order to also fulfill our climate goals and make sure that we're building a sustainable climate, that that can be a future characterized by good middle class union jobs, and i think the outcome -- i mean, these are only tentative agreements at the moment. they have to be ratified by the members, but the uaw's historic efforts at the table shows that there is a path for good middle class union jobs to characterize the future of the industry, and that is certainly consistent with the president's vision and his desire to see -- to be the most pro-union, pro-worker president in history. >> finally, on labor force, a bit of a flattening out of participation. that's one of the flies in the ointment this morning as the street reads the print on the jobs number. do you see that number going markedly higher, and why do you think it's stalled out a bit here? >> those numbers continue to be high as well. if you look at historic trends,

they remain high for women, so the employment rate for women in this country for seven months now has been the highest on record since, i don't know, like 1948. so, it does show that people are coming into the job market. they're looking for jobs, and they're finding them, and that is especially true for prime age workers. we do have an aging population, and so of course, that population, that labor force participation rate will be different, but for prime age workers, it continues to be very, very strong. >> finally, on remote work, i'm wondering if the white house has been impressed with some of the castle office swipes or at least the degree to which people are returning to downtown, whether they are in the office or not. >> right. i mean, i think this whole, you know, post-pandemic, what the workplace going to look like continues to be in some ways we're still in that transition

and adjustment to see what works. how do we take the best lessons of remote work but make sure that people are still able to work in common spaces, work in downtowns where we want businesses to be able to reopen and to be able to thrive. so, that's why we started to document remote work trends, and we still see certain things that, you know, women tend to work in remote arrangements more than men, for example. but i think that is something that we will keep an eye on, because we expect those numbers to continue to adjust as we adjust as an economy. >> secretary su, thank you so much for your time, shedding some light on the print this morning. good to see you. >> you too. thank you so much. >> acting labor secretary julie su. sounds like they wouldn't mind to see shawn fain go forward, jim. >> yeah, i think that those of us who favor kind of a more, let's say, all-encompassing view where labor and management can win are appalled at this. you know, you want to go by the

most pro-union president ever is a very divisive thing, i think, because i do believe that companies like ford, gm are trying to make a transition to ev, and they really can't have a shotgun to their head. you can't tell them they must go to ev and at the same time they have to pay the workers a huge amount. i think you have to -- i think that when the president came to the picket line, i was shocked that he didn't pay a little visit to jim farley and say, listen, maybe we can work something out that is good for the workers. instead, he was very adversarial, and i was very disappointed by that. >> i think he's unwinding 30 years of capital swinging to capital rather than labor. >> i think we tried to get a hundred years of companies not doing fossil fuels, and it was, to me, the more important imperative was how to be able to make it so that you can continue to afford ev, and i didn't get any sense, particularly after batteries, that that imperative can be met. i think we're going hybrid because there's just not enough money, and i thought that was disappointing. the climate was sacrificed upon

a cross of 25% increase. >> how impressed are you, tom lee's got a phrase going called the baby rally that he expects to develop here? just given some of the prints that we have still coming. >> the diapers? what is he talking about? >> like a baby. >> i don't know. i was not a good changer. i do think that, you know, and i try to tell this reference to my colleague, david, that apple is the one to watch, and they couldn't bring it down. they tried. they did everything they could, and their east of eden game plan failed. >> got it. >> got it. i try so much, carl. i've used so many book references. >> you do. i know. i am familiar with that title. what's wrong? >> because i'm trying so hard. >> what do you -- >> i'm trying to get you something, you know, trying to get you there, you know, a little classic reference books. i mean, what do you want me to do? you know who the president is?

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let's get to jim and stop trading. >> yesterday fortinet reported a miserable quarter and blamed a slowdown in the industry. that is so false it's pal pa labl. i spoke to clorox it's the opposite. buy palo alto networks and cloud strike. the travel trust owns palo alto. fortinet says things are bad in the industry, [ inaudible ]. >> that one i got. i totally got. >> the fault is in fortinet, not in the stars. okay. >> as for tonight. >> i got halleon and then aep, won big yesterday, it's a bit of an interest rate play. great utility. what a fun show, guys. want everyone to have a good weekend. dave is going to catch up on the morning show, one of my favorite heros, paul marks. >> from the morning show.

>> yes. i think tim cook disagreed on the 17 from the record. >> threw he under the bus with tim cook. >> right under. >> jim, we'll see you at 6:00. "mad money," 6:00 p.m. eastern time. when we come back more reaction to apple's results and guidance and an exclusive with richmond fed president barkin. s&p 4360 back above the 50 tai since mid september. i'm going to sell my life insurance cuz i don't need it anymore. my kids are grown, my wife is great, let's settle up the score. it's time to travel to paree, spend retirement happy. call 877-sell-easy. 877-sell-easy. 877-sell-easy, and sell your policy. you can sell all or part, live your life and play it smart. 877-sell-easy, and sell

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good friday morning. welcome to another hour of "squawk on the street." i'm sara eisen with carl quintanilla, and david faber, back for you as always from post nine at the new york stock exchange. take a look at stocks, the rate relief continues and stocks are in rally mode. every sector higher in the s&p except for energy. it's being led again by real estate, the the res are having a comeback on the back of the loer treasury yields. utility, materials, consumer discretionary positive. nasdaq composite good for almost 2%, adding to gains for the week which total more than 6%. s&p is up almost 6% for the week

on its part. why? well treasury yields are moving south. guess what? we're going to talk about that and talk about instant reaction to the jobs report and what that is going to mean from the fed with tom barkin, the richmond fed president, a votser next year, the interview is coming up in a few minutes. first, we're 30 minutes into the trading session. few big movers we're watching. apple under pressure after posting its fourth straight quarterly sales decline. its holiday forecast missing estimates and we'll discuss what's ahead for the stock. shares of expedia are soaring. the company beating profit estimates saying it sees resilience in demand for travel. expedia announcing a $5 billion stock buyback. watch the regional banks, they're on pace for a fifth straight positive day on pace for the best week since november 2020. we saw bill gross of pimco on last night saying he's a buyer. >> indeed. meanwhile, the data is not over. ism services are out. let's get to rick santelli.

>> absolutely. if we're looking for numbers that may move the market once again, there's some surprises here. ism services for october 51.8. that is the weakest level since may of this year. 58.6 on prices paid. that is somewhat in line, follows 58.9. 58.9 the highest going back to april. if we look at the employment front after having a weaker than expected jobs, jobs, jobs report, this one is really weak, and it fits right in. 50.. that is the weakest since we're under 50 and that was may at 49.2. finally on the new order side, do remember these are all on the service sector, new orders, actually much stronger at 55.5. that's the best level since august, when it was 57.5. that has been running on the

strong side. we see interest rates have stabilized a little bit here at a very, very big level. 4.5%. we've ben as low as 4.47 and currently at 4.53. do keep in mind we settled at 4.84 last week. we're down 31 basis points on 10s for the week. sara, back to you. >> yep. it is quite a jump in bonds and a big fall in rates. thank you very much, rick santelli. by the way, the services number adds more fuel to this. the market liking the numbers that are coming in weaker than expected as long as they're not pointing to a he roo session. i think that's the story with the jobs numbers today. just to review some of the highlights and it was a weak number, 150,000 jobs added. that was less than expected. it came with, and i'll add a few more things here to show you the lab lab labor market is weakening,

101,000 revisions lower, negative revisions there, employment rate to 3.9%. that's negative as well. and it didn't come with a higher participation rate. the participation rate actually declined a touch. first time we've seen that in a year. you can go through some of the other internal metrics like private prayrolls that improved 99,000, compared to september, and more than 150,000 that were estimated. and then david, manufacturing jobs we know were impacted by the strong. they quantified that. 33,000 job losses out of the 35,000 relawsuited directly to the strike. even if you would have added those back, now the strike is off, it's still a weak number and points to, you know -- i don't want it say finally, it's not good news for america to see higher employment but something that investors and the fed and everybody else were expecting to happen for so long and now it does feel like it's happening and the verdict is the fed can be done, which we got kind of

hints this week it wanted to be done anyway. >> right. and does this influence that even more? >> for sure. it influences it more. i would add it to the ism number we got this week on wednesday which showed weaker manufacturing and add it to even the services number, which, you know, services have been the part of the problem here of where americans have been spending and why inflation has remained elevated. this is really all about targeting weaker inflation, not a weaker economy. those two do go hand in hand. if we start to see the weakness in economy without falling off a cliff, that's why people are saying this is goldilocks and actually good news for the markets. >> the acting labor secretary joining us talking about the normalization of job growth and that being a good thing and something they've been focused on. had it been a higher number they would have been happier too. >> they celebrate the high numbers but on the low numbers we're reaching a healthy period of growth. >> which means inflation to your point will start to come down.

wage growth, anything there? >> it was lower than expected and that's good to see for the fed and investors. 0.2% was lower than 0.3% expected and continues to point to a cooling off on wage pressures, something the fed has been concerned about, on top of powell's commentary this week he feels good about what he said is the progress on wages. you know, guys, usually we have really good data, good economic data and then i point out some of the company negativity. to you it's the opposite. it's the negative data, but the company commentary is quite strong, at least when it comes to the services part of the economy. live nation, of course, which owns ticketmaster, we know people have been spending big bucks on concerts. that was confirmed in the commentary from live nation as well. the cfo says if we look at our ticketmaster platform for the month of october ticket sales were up year over year relative to last year. they were up double digits in north america. we're seeing no sign of weakness. >> yeah.

liberty company by the way put that out. >> under formula 1. >> now we have to talk about it every day until -- >> we will be happy to talk about formula 1 as we promote what will be a great documentary next week. >> november 16th. >> any other commentary that caught your eye? >> expedia, another part of the economy where people have been spending on travel haven't seen anything on the consumer side. we keep looking, but there's nothing obvious. you would have to squint really hard and look by subregion and cut by price point and a lot of things to see anything noticeable in terms of the slowdown. starbucks also i thought was very -- >> expeed with ya shares are up. we didn't hit them in the last hour. glad we lithit that. >> starbucks too. you know, consumer demand remains strong. we're not seeing change in sentiment of our customer base at this time. the real weaker parts are in the industrial economy, maersk, i don't know if you highlighted

the shipping company, that's where you hear the new normal we are headed into is one of more subdued macro economic outlook and soft volume demands for the years. inflationary pressures on our cost base especially from energy costs. that's where you hear the cautious commentary. >> i want to remind to monday and we got a lot of favorable data points for the equity markets, the 10-year, which is dramatically fallen in yields even this week. >> it's favorable points for the bonds and that helped give equities some relief, although there was good earnings sprinkled in there as well. this week, i would say the highlight which is crazy to say, were some of the financing and refunding announcements from the treasury showing that they're going to issue less on the longer end. that was such a relief that almost provided a bigger relief than the fed on wednesday when we got those numbers. but then theed if was friendly to the markets as well where powell said the extra dot could

be stale. which is the extra rate hike potentially in december. and then the data points a little bit weaker. manufacturing, services, and jobs today all adds up to quite a bond rally. we were at almost 5% on the 10-year on monday. >> i know. >> now we're around 4.5 a. >> amazing. it has been favorable as you pointed out for the overall equity markets. one company, though, it's by far the most important at least in its weighting in the s&p 500 is apple. that stock is down about 1.4% after, of course, earnings. our next guest maintains his outperform rating a price target of 240 and says the stock could be weak on headline news, but he would be a strong buyer on iphone and services growth. dan ives, always good to see you, dan. all right. why are you still a buyer? what about the iphone demand, at least seems to have heartened you? >> i think when you look at it, the iphone demand was actually strong and even in china, cook called that out, even going to

the december quarter. now china was weak because of mac, ipad, what i view as more noise. the core, bread and butter here, iphone demand is strong, growth is going to return. services was massive in terms of double-digit growth and the margin story continues to expand. so to me, the fictional narrative that the china iphone demise was going to start, that's essentially thrown out the window. to me even knee-jerk because this is down. i view it as a table pounder going into the next 6, 9 months. >> i thought analysts were looking for as much as 5% growth for the next quarter. we're not going to get that. is that a disappointment? >> to that point that's more mac, ipad and fx. if you look at iphone units that's actually in line with expectations. you're starting now to see growth, and the most important thing you talk about on the show

is china. the china iphone story that cook really reit ter rated last night, that remains firmly strong. i think that's the important thing relative to huawei, geopolitical and many yelling fire in a crowded theater that the apple growth story was in the rearview mirror. >> that services number pretty extraordinary as well. give me a take on 22.3 billion, what that looks like. mart begins are strong and what kind of multiple is deserved. >> that's the key to the rerating in apple. many talked for years, right, 12 times is where you buy it, 16 times where you sell it, and continue to head scratching for the valuation. today it's the services. services at one point was worth 150, $200 billion. we view that as 1.4 to $1.5 trillion, that's $100 billion annually, growing low to mid double digits, margins double, the actual hardware business. services is the key.

to me as a bull, i sit here more bullish on apple than relative to 24 hours ago because of services and because the iphone story if you look at it, it's actually strengthened relative to i think some of the fears. >> some of your colleagues or competitors and other analysts are lowering their target, citigroup, dave davidson, on the guidance. >> and i think that's one where many have been bearish on apple for the last, you know, decade or last few years, so it would play into the narrative. sara, i continue to focus on you own this for three things -- iphone, services, gross margin story. everything else -- >> iphone sales guide is flatish, isn't it? >> when you look at iphone sales, actually growth is going to be there for the december quarter and into march it's up 4, 5%. i think the narrative was, iphone growth hasn't seen growth. now you actually will see it. most importantly here is the

china story and cook talked about it, strong. a record quarter in terms of mainland china. i just got back from asia, you know, the last two weeks, got back two days ago, it's a much different narrative than i'm seeing on the ground there than maybe the perception. i think has to numbers reflect that. >> there are a lot of different data points. we try to tend to ignore them. in terms of what moves the stock from here, it is still up 34.6% for the year. far outpacing the broader market of which, of course, it's the most important part. what is the catalyst that's going to turn this around. >> i think iphone units when i look at the next two, three quarters will beat expectations. i think numbers right now i think have really troughed out. you start to see growth now on the horizon where we haven't seen it up to the last year. then it's all about services. services we talked about you didn't really have growth, now it's double digit. 15% growth was just a game changer, and that is really the

key to the multiple and gross margin story that continues to go higher. and i think cupertino here is just in a massive position of strength, and i believe going into next year, this is a stock that makes all-time highs rather than one that is a time to retreat. >> we'll holded you to that, dan, and we know we'll have the opportunity. thanks for joining us. dan ives. as we take you to a quick break let's give you a road map for the hour. skyworks amongst the apple suppliers under pressure this morning. cyber security names also taking a bit of a hit. we'll get you the stock movers you need to watch. >> sam bankman-fried found guilty on all counts in the ftx fraud trial. his legal troubles may not be over. we'll talk about the fallout for the crypto community. >> after the break, an interview with richmond fed president tom barkin here at presideost nine, talk rates, inflation, jobs report and more. we're back after a quick break.

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♪ stocks are in the rally mode. why? treasury yields continue to fall. it's been the story of the week. the latest move coming after the

jobs data, weaker than expected. the employment rate hitting its highest level since january of last year as the fed held rates steady this week and upgraded its assessment of economic growth. richard fed president thomas barkin joins in to weigh in on all of it and steve liesman joining us at post nine. president barkin, first impressions? looks like a pretty weak jobs report. what do you think? >> i've been saying that there's been this disconnect between the data that we're seeing, and i'm hearing on the ground. i believe what i'm hearing in the economy. what i've been hearing is normalizing. labor market in better balance, supply getting better, demand is coming off, particularly in places like professionals. it's still hot in skilled trades. you hear a lot of heat in skilled trades. i want surprised. it was a welcome to see the gradual lessening that we've been expecting is continuing. >> does that mean you can be

done raising rates? >> you went right to it, didn't you, sara? >> that's the question. >> i'm not going to prejudge that. i value the optionality of seeing what we see in the data and we get two inflation reports between now and the next meeting and i think that's what's going to matter to me. >> it feels like you guys want to be done, like you feel like you've done enough, right, and you want to see it manifest in the economy? is that accurate? >> what i would say, we want to be done with flainflation, you t to trust but verify. i would like to see inflation continuing to come down. >> i ask the fed chair one question, so you have the opportunity here to answer the second question i would ask him, which is at least in the wake of the meeting and certainly even before the meeting, the market has begun to price out an additional rate hike. are you comfortable with how the market is pricing that regarding the sense that, are you afraid you are losing optionality to hike again? >> i would like to think the market is responding to the data, and so what we saw today was data that showed a gradual

lessening in the job market. i think that's what those who would like to not see another rate hike would want to see. we'll see what the inflation comes in. if the inflation comes in hot the market will react, i'm sure. >> if it does come in hot, this idea of doing one more quarter point, it seems almost sue per fa his, right. if you have inflation that remains high, another quarter point ain't going to fix it, is it? >> you can say that about every one of the things we do. does 25 basis points matter or not. the notion of expectation matters a ton and if you're not going to respond to inflation when it shows elevated, i think expectations respond to that. i'm not sure 25 basis points in the end is the answer to all the world's problems but if you take care of inflation you have to respond if it shows up. >> you want inflation to be over. how will you know when to declare victory? we're at, what, almost 4% on core inflation. you want it to be at 2%. you're not going to wait all the

way to 2% until you say you're done, right? >> i'm focused on trying to understand the behaviors of price setters. if you go back to 20, 30 years, price setters have been beaten up by the combination of e-commerce, globalization, access to new supply, and the power of big box retailers, and if you go to 2018, 2019, you talk to those folks, with you found people who weren't into raising prices and didn't think they had the power to it. i'm talking to price setters and some have taken a step back and say we're on the backside of this, apparel would be a good example of that, but i still talk to price setters looking to get more price. look at the big consumer products manufacturers, they're interesting to look at their earnings. 2019, 2018, price up 1 or 2%. volume up 1 or 2%. in the midst of the inflation era, price up 1, 13, 18%, volume steady. you're seeing price of those big manufacturers up 7, 8, 9, 10%.

volume starting to come off. i'm looking for the point where they're no longer taking outsized price increases because they're worried the volume and market won't sustain that. >> what are you saying, say you're at a dinner party and, you know, i can't remember a dinner party where real estate didn't come up. are you like roundly hated because of what's happening in the mortgage market right now and do you think it's gone too far in terms of 8% mortgages? are you leaning too hard on the market? >> i go to dinner parties with old people and old pay say i used to pay x percent for mortgages. i think the housing market there are a set of people who want to buy into a house and they're increasingly frustrated by lack of access. the home builders, the big home builders are building at scale and markets in mind like north carolina where you're seeing a lot of home construction. in places you're not seeing that, i see the frustration. i think the broader commercial real estate market is the place

they're not throwing me parties right now and a lot of noise in that market. >> dig more into what -- when i follow you, what's interesting is you lean less on the economy metrics and more on what you're hearing and how business works and your ideas about price setters and how they think culturally. give us more of the anecdotes, how week do you think the economy might become here from what you're hearing from your business contacts? >> what i'm hearing to those who sell to lower income consumers, they're reprioritizing, making choices. they're not out of the market. they're spending, but absolutely reprioritizing where they spend and how they spend. you hear about discretionary versus nondiscretionary. i'm hearing increasingly over the last three months more news of middle income consumers trading down. look at walmart, they have that in there. the wealthy are the ones still spending. even the wealthy are backing off of goods. they're still spending extravagantly on services. and so that's what's really

keeping the economy going on the high end. now, we're seeing consumer spending data that's much stronger than what i just described, and so that's the disconnect i talked about at the beginning. i still think there's a good chance at what we're seeing on the consumer side is a normal economy, solid economy, not a frothy economy, that would be implied by the recent retail sales or consumer spending. but we'll see. the data will get updated and we'll get nor data and see what it looks like. >> have you been impressed by the productivity data and is it changing the way you're thinking about the economy's ability to grow without inflation overheating? >> really pleased by the recent productivity data. really unhappy about last year's productivity data. you can't, in this era where people left work and low pay professions and came back, can't look at it other than a four-year basis. productivity over four years, it's basically where it was in 2018, 2019. it's a tick better than it was in 2013, 2015. i hope it continues.

there's lots of trons thireasono think it might as people figure out how to do more with less. >> related to ai even at these early ionings? >> i think it's too early to give credit to ai. it's people delivering to your customers with fewer workers. >> you mentioned commercial real estate as being you seem to indicate as we know potential problem. i just like to get a little bit more from you on that. how big of a problem do you see it? two-thirds of commercial real estate loans are fixed rates, 10-year moving down in yield, a bit of relief, but overall, what are your expectations there? >> well, commercial real estate apart, industrial is doing fine and retail is actually doing -- >> office, obviously, under the most pressure. >> and really b and c downtown office where people aren't going back to work. that's a troubled sector. it's a bit of a slow-moving train because individual owners have choices as to, you know, when to sell and how to sell or

give it back to the bank or not, but everyone i talked to from banks to real estate thinks that's a segment that's going to go through a set of challenges. >> banks don't want it back if they can avoid it. >> i don't think they ever have. >> no. >> there's a set of challenges we'll go through there. i don't think this is an unknown challenge. we've had commercial real estate before. the banks i hope and expect have the capital to fet get to the other side of this. >> you will be a voter next year. >> yes. >> on the committee. how are you going to determine when to cut rates? >> seems like that's still a ways off in my mind, but what i'm looking for is for inflation to settle. i like it when you can get three month, six month below, as has been happening when that continues down and hope and expect we'll make continued progress on that next year. demand matters as well. if you see really vibrant demand, it's hard to make the case that that vibrant demand is helping inflation slow, so that's another thing to watch

on. you can imagine scenarios where demand comes off and you have to do something you can imagine scenarios where inflation starts to settle and you want to lower real rates. both of those imaginary things still feel pretty far out in the distance to me. >> when it comes to lower rates, i would love for you to respond to something we heard on cnbc from jeffrey gunlock, one of the important voices in the bond market, the fed is going to be forced to lower rates because to do otherwise given the refinancing needs of the u.s. government. we're going to be running trillion interest costs within three years. is that a real factor that you think about? >> i think we're just trying to get inflation under control. i'm not spending time thinking about government. >> at all? it is possible if rates were to stay high the u.s. government's budget would be basically eaten up by interest rate costs? >> i think the size of the deficits we have now is something getting a lot of attention and should get a lot of attention and, of course, if

you reduce them, you'll reduce the interest cost. we'll see what various legislators choose to do with that. >> when we do our fed survey, we did a grading of powell this time around. and we asked people to grade him on different things, and he got a d in economic forecasts. you guys missed the inflation on the upside in terms of how you ran policy. is there a t-- a reason to have confidence? >> i hope you don't do a grading after this show. >> we'll judge you later, right. >> i do think if you look at my forecasting, i'll talk about myself, i didn't see inflation persisting for nearly as long as it's persisted. i did see the risk of a volatile market around the reopening of the economy, but i mean, i thought that this would settle more quickly too. i'll take my share of that grade. i think pretty much around the world, people had that. that's an important question. why is it that we collectively as forecasters didn't see

inflation persisting? i think it has to do with, you know, the way one thinks when it hasn't been there for 30 years, right. the sense that expectations would settle so quickly. what i believe going back to what i said before is that there were price setters throughout who didn't think raising price was a lever. if you're a business, though, raising prices is the valuable lever as long as your customers don't go away. all of a sudden it became clear to price setters they could do something and they're not going to give that back without competitors or customers, you know, forcing them to do that. so on the other side i'm trying to pay attention to the same people and what am hearing is, it's going to take a while for them to come back. >> 10-year yield doing the work for you? >> financial conditions help do what we're trying to do. we try to do our rate moves, effective financial conditions, that affect the economy. as long as financial conditions aren't affecting the economy in a direction that takes us the right way it helps. it's not a policy variable.

they're pretty volatile. we don't control it. >> yellen took incoming this week from stanley druckenmiller for not issuing more long duration when rates were lower. she responded last night by saying that actually portfolio duration is the longest it's been in decades. do you take a side? >> i'm clearly not going to take a side. >> do you think we've seen the highs in rates? >> i don't know which rates you're talking about, but -- >> fed's interest rate and the market interest rate? >> i don't know. >> asking it in a different way. >> it depends to me on what happens to inflation, and i'm watching that closely, and i'm very hopeful that we're nearing the part we can get us under control. the markets will tell us that. >> is there a big disagreement inside the fed between those worried about inflation sticking around longer and having to do more and those that feel like they're done? >> the great thing about the committee, people take those. i think it's a consensus

oriented committee as you've seen. everyone puts their view on the table, we work it out, and we've been able to come to a strong consensus. >> do you have to be convinced to hike? or do you have to be convinced not to hike? >> i don't prejudge the answer as you know. we've got a meeting in six weeks. we just got out of the last meeting. i'm saying we got out of the last meeting. let's get two jobs reports, two inflation reports, consumer spending report and see if the things that i think i believe today are still true or not. we've got a lot of time. >> one more way. is there -- over tightening or under tightening right now? >> good one. >> big risks. >> they're both big risks. >> sure. >> and more in balance. >> and also a risk that some boulder comes in from left field and takes on the economy in the way that pandemic did. so you're always dealing with under tightening risks and over tightening risks and always dealing with risk perfect policy

can get -- >> you haven't brought up gee yes political tensions. is that not something high on your list of risks out there? >> when you see a conflict in the middle east you think about oil prices and those of us that lived through the '70s an oil spike has issues. our economy is different than it was in the 'mid-70s and we produce more. i've been pleased so far it hasn't spilled into that part of the economy. that's absolutely something to watch. when i talked about boulders that's a classic example of a boulder. >> you did well, four on one, not bad. tom barkin, thank you very much. >> good to be here. >> thank you for sharing your views and what you're hearing. the president of the richmond fed. coming up after the break, goldman's chief economist jan l hatzius will weigh in on the jobs numbers and comments from president barkin, productivity, bond duration, when we were back in two.

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president barkin, productivity, as you saw richmond fed

president barkin talked about he would like to see inflation continue to come down before deciding on ending rate hikes and we're still a ways off from cutting. his comments come as the jobs report posted smallest gains since june at 150 k. head of global investment research jan hatzius is here at post nine. >> wonderful to be here. >> undercut almost every expectation on the street. just talk to me about the print. >> i thought it was broadly weaker than what we expected, and i think if you look at the reaction of the bond market, clearly weaker than what the market was pricing in. i don't think it was weak in a very concerning way. we still printed 150,000 headline payrolls a little over 180,000 if you add back the strikers and household employment was down a lot, but if you adjust it for the definitions of the payroll survey it was up somewhat. it was a softer report that i think underscores the message

that the market took out offomc meeting that the fed is likely done hiking, but i wasn't particularly concerned about much sharper down draft. >> right. between the treasury refunding, the feds frommer and now this, has it changed your views about '24 at all? >> no. with expect growth at about 2% in 2024 and we think that inflation is going to continue to come down gradually, but we still have it a little above 2% in the fourth quarter of next year. i would agree with the idea that it still will be a while before the fed is going to start cutting in our baseline forecast. however, what i think is very important is that they can cut if things were to weaken more sharply. that is now an option that is an additional insurance policy against the recession that

wasn't available six months ago or 12 months ago. >> we mentioned a lot of the weak spots in the jobs report, but you're right, i mean it's not like the labor market is collapsing. as of september we had 9.6 million job openings, historically low weakly unemployment claims filed by americans, 1% of the labor market is on unemployment checks, so is it a tight labor market or not? >> it's a tight labor market, but it's becoming very gradually less tight. it's moving into balance more. you're right that job openings numbers over the last few months have been more stagnant and that's true not only if you take the jolts numbers, but also some of the bottom up numbers. so it's still a tight labor market, no question, but in much better balance than it was a year ago. another indicator is the quit rate, also in the jolts report. that's at the level that it was at in february 2020 and says

still a strong labor market but not as sort of outsized tight as it was a year ago. >> this all feeds into your view and thee fed's view the work is being done, inflation coming down, growth slowing, but not recession. what would cause you to get more worried about yount side risks as we start to weaken here? >> that's right. it is consistent with that baseline view. what would make me more concerned, you want to respond to high frequency data. i'm not seeing anything particularly concerning there. what our potential concerns, well, conflict in the middle east. you think about oil prices. the economy is less sensitive to oil prices than it used to be. u.s. in particular because the u.s. is now a net exporter of oil. but that's something to watch. and i think the adjustment to a more normal real interest rate environment after 15 years of

very, very low real rates, i mean, we are still in the process of that. that could cause some adjustments. housing is an obvious place where we probably will see more weakness. commercial real estate also already came up. i think that's probably more multiyear adjustment. but those are the things to watch. >> barkin says cuts may be a long way away. powell not thinking about it yet. when does the first cut happen in your view? >> in our baseline it's the fourth quarter of next year. we don't have any cuts for a year, but if you look at the risks and that, i think they're mostly tilted to the downside. very hard for me to see how you get a material amount of additional hikes. it's not that hard to see how you could see cuts if things came in weaker. >> yeah. swaps talking more like june or july. june this morning at least. >> yes. they would also reflect the probability weighted path, which

for me would also be an earlier cut just because there are downside tales you don't have in the baseline forecast. >> your q4 gdp did you go to 1.7. >> yes. we lifted that in part because we're no longer building in the government shutdown and the momentum into q4 is looking a little bit firmer. at strike having been settled also helps t margin. i would say 1.7 is still far below 4.9 and the 4.9 does look like an outlier to the high side in a number of ways. >> nice to see some of your potholes get paved over for q4. >> we're calling it a speed bump. >> jan, thanks. good to see you. >> thanks very much. >> still to come, we'll talk about sam bankman-fried found guilty on all seven criminal fraud counts against him. as we lead to break, check out shares of block after the payments company topped estimates on earnings an revenue, also raised its full-year guidance in addition

announced a $1 billion buyback. that is having a positive impact on the shares.

welcome back to "squawk on the street." a jury has found sam bankman-fried guilty of all seven criminal counts against him and the ftx founder faces a sentence of 115 years in prison. let's bring in kate rooney and eamon javers here to discuss about what happens next and what will determine how much he gets. >> one of the big things we're waiting for is sentencing to come at the end of march, but also this other criminal indictment about campaign finance violations. we heard a lot of the evidence in this trial that was related it that. it could play into sentencing. i was just on the phone with a legal expert who said that judge kaplan's sentencing could take that into consideration and say that it's relevant as evidence and that that would potentially

add years to the sentence as well. the max sentence is 115 years. we heard from some of his top lieutenants who testified that he took customer money and some of that was spent on campaign finance and done illegally and done in ways that hid where it was coming from and -- >> those are separate charges? >> separate charges, but the evidence we've gotten a lot of what we would theoretically hear in the other trial. >> eman, what part of it are you following? i mean you've covered a number of these court cases and some of the legal ramifications as far as what happens next? >> yeah. look, this i think is the beginning of accouchapter 2 of crypto story. chapter one is until yesterday, the shocking run up in crypto valuation ending with sam bankman-fried's fraud and conviction and then the question is what is chapter 2 going to look like for crypto currency going forward.

how will the crypto community build a business that strips out some of the sort of larceny that's been a regular theme of crypto going back to the days of silk road and through sam bankman-fried, and now into a world where they can say this is an asset class built on something that's real hand has a real business model. to make a use case for crypto, something other than just an investment based on the grater fool theory. they have to build a use case to say this is a tool to solve a problem in the real world. there's a lot of pieces of this technology that can do that. blockchain is a pretty compelling technology, the idea of a public ledger is compelling. business ideas floating around out there. nearly 15 years into the story of crypto currency, we don't have real world applications where this is being used in the real economy as anything other than a speculative asset right now. chapter 2 for crypto is solving that problem. building it into the real world. >> well, there is always the

terrorist financing. i know that's been a big story. >> sure. >> in the last few weeks, trying to go after hamas accounts. >> sure. absolutely. look, i mean crypto has been used for all sorts of illicit financing. law enforcement if the problem is big enough, amount is big enough or terrorist target is big enough law enforcement can track this stuff. it is not anonymous. it is a public ledger. they can pull the threads and figure out where the money is going. it's not useful necessarily as an anonymous spending tool. it's not really a currency at all in the sense that you can't go out and buy a hamburger with it in the real world. what is this asset good for is a really sort of open question at this point in the history of crypto currency, and i think there's a lot of entrepreneurs and geniuses thinking about that. it's powerful, compelling technology, but the question is how are they going to apply it in the real world for something other than the nefarious things throughout the history of crypto. >> speak of the crypto

ecosystem, buy nance figured prominently towards the end there in ftx's collapse. where are we right now? >> the view has been that there may be a doj issue around binance. they had to shut down their u.s. business. there's been a trickle effect here and it's hit binance. they've had to close some of their accounts and they were a big part of this story. they were brought up consistently within the trial and it's hit the credibility especially of offshore accounts. i think it's helped coinbase, that's really the regulated onshore u.s. business although they've got issues of their own with the sec and they're facing their own legal battles. anything offshore for a u.s. investor people will think twice about the disclosures, auditing, and some of the finances, and it has hit that business as well. it's really shocking to the extent to which investors are shaking this off and kind of shrugging this off. sequoia, big-time investors who

were here and said good riddance, that's taken care of, we're still investing in the space and optimistic and bullish, which is kind of fascinating. they're not seeing a moment of this reckoning and kind of thinking back it seems like people want to move forward and kind of shove it under the rug and forget it happened. >> due diligence, don't worry about that. >> to that degree, i mean, bitcoin is up $5,000 in a few days on the hopes of some of these regulatory approvals. >> sure. and -- but the question of what bitcoin is for really hasn't been answered yet, other than speculation, right. it is having a rally right now, not nearly to the highs where it was, but if you look at this idea that kate was hitting on of the silicon valley investors here, the wall street titans and big prominent names who flew to the bahamas to get next to sam bankman-fried, the politicians who took the donations from sam bankman-fried, the celebrities who took enormous amounts of money for very little work, there really does need to be

some soul searching in all of those camps right now as to why we did this and were we enabling this fraud by our mere presence giving legitimacy and propping up this guy and is that going to happen again? that's the question. how do we stop that from happening again? it won't stop unless unless the soul-searching in all those places. silicon valley, wall street, washington, hollywood, wherever celebrities and sports executives live. all of that needs to be throughout through? >> is he allowed to still tweet? >> i don't think his lawyers will let him tweet. >> that privilege is revoked. >> did he say he could not remember if he offered to pay off the bahamian national debt? >> he did, $11 million national debt. i'm thinking of a conversation i had with sam bankman-fried when he was out on bail, before he got his bail revoked. this was on background. it wasn't reportable at the time. we just didn't think it as newsworthy but we were trying to get him to do this on-camera

interview. he told me he would rather be in jail with a computer than out free in the world without internet access. so for someone like sam bankman-fried who lived his life online, the worst punishment could be not having internet access. >> thanks for wrapping up a truly remarkable period in finance. another busy day of earnings, apple shares dipping below -- lower after posting four straight quarterly sales declines. dom chu is tracking some of that fallout. >> apple down about a percent or so right now. holiday concerns, weakness in china also weighing on that stock. the business, by the way, in china down 2.5%. it came in below analyst estimates. if you take a look at supply chain fallout, it seems as though we're shrugging some of those off, qorvo, corning, moving higher perhaps on a macro number. shares of fortnet down about 17%

just off its session lows. missing the mark on quarterly earnings. revenue, billings and guidance. cantor fitzgerald, stifle, lowering their target price. the firm citing target headwinds and messier outlook. other names in cyber security mixed, palo alto, crowdstrike, both lower, okta moving up a percent or so. expediabooking moving in opposite directions, surging, up by 16%. beat across the board. posting record-breaking revenues. the company announced $5 billion stock buyback. booking holdings trading lower after seeing increased marketing and personnel spending and higher cancellation rates. ceo glenn fogel remains optimistic citing growth for a summer travel season. those shares down 1.25%. back over to you. coming up in the next hour, speaking of earnings, the cfo of block will join us.

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there might be another reason. another big reason why he's doing that as well. robert frank is here to explain. robert? >> good morning, david. jeff bezos posting on instagram last night that he's leaving seattle after nearly 30 years and going to move to miami to be closer to his parents and his rocket launches over there in cape canaveral. he's going to save a fortune in taxes. last year washington state passed a new tax on capital gains. long-term capital gains there are now taxed at 7%. in 2021 bezos sold $10 billion of amazon stock so he would have owed $700 million in state taxes. he hasn't sold a single share of amazon since that tax took effect last year. washington lawmakers have also tried twice to pass a wealth tax, that would impose a 1% tax on all financial assets, so bezos would owe $1.6 billion a

year if that were to pass. instead he can use that money to build his new beachfront estate in miami. he bought two properties on indian creek for $140 million. brokers say he'll likely tear down the existing mansions and build a new one. his new neighbors include tom brady, carl icahn. >> ken griffin has nothing on bezos. >> he might have a better art collection? >> who, griffin? >> yeah. >> i'll leave that with sara. "squawk on the street" is back after this.

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happy friday. welcome to "squawk on the street." i'm sara eisen with carl quintanilla live from post 9 at the knock stock exchange. a goldilocks jobs report? a breakdown of the numbers and what it means for the fed. plus an earnings triple play. first up, cash. block cfo with us with a look at the company's blowout quarter in the future of fintech. the consumer, the ceo of restaurant brands are spending