to be. and elon musk launches a new a.i. venture promising to have a rebellious streak. it's monday, november 6th, 2023 and "squawk box" begins right now. good morning. welcome to "squawk box" here on cnbc. we are live from the nasdaq market site in times square. i'm becky quick with joe kernen and andrew ross sorkin. here we go. a new week where you are talking about some modest advances. dow futures up 30 points. nasdaq up 42. s&p up over 8. this is the beginning of the new week after the markets are coming off the best week of the year. the dow was actually up more than 5% last week. the s&p 500 up 6%.

nasdaq up nearly 7%. these are phenomenal returns we are talking about. it happened over the treasury market. yields are down from where we had been this time last year. the ten-year yield below 4.6%. we had been talking above 10%. the two-year yield is above 4%. we heard this from the thereasu department last week and they were selling less of the long end of the curve. that really played out in treasuries and that was followed in equities and if you look at what happened overnight in asia with the action there. south korea stocks surging after the country reimposed the balaban on short selling. kospi up overnight and that is following the gains from the united states. the dollar last week saw the worst day and week since july. that is also why you see the

help overseas with the markets. in the meantime, we are watching crude prices with saudi arabia and russia reaffirming they will stick with supply curbs of 1 million barrels per day throughout the end of the year. that despite the turmoil in the middle east. saudi arabia will review the production volumes next month and try to consider to extend the cuts or deepen cuts or increase production. wti crude right now at $81$81.9. joe. secretary of state antony blinken making two surprise visits to the west bank and iraq in an effort to keep the conflict from spreading. he visited with abdullah.

he met with personnel in iraq and israel. israeli military officials say they opened a term corridor to allow people to head south. it has been a total communications blackout after the intense air bombings. meantime, bill ackman is online calling on harvard university president to take st steps to reduce anti-semitism on campus. bill ackman called the situation dire. in a letter, ackman said the bab bab

barbaric attacks several weeks ago call me to believe you will not do anything. he called on law firms last wednesday saying we hire your people and we don't allow this conduct at our firm. you can't allow this conduct at your schools. especially if we are hiring from there. we need you to train our people to have the values we will ultimately have. interestingly, in his letter, he is not calling for the president's resignation or the firing of the president. this is a unique way saying left me partner with you and show you all of the problems that are at hand. by the way, you go on tiktok and

inst instagram. there are now movements afoot of people tearing down posters and not just to identify who they are and tell people do not hire this person. they will go to linkedin -- >> people tearing down the posters. >> tearing down the posters, not just tearing down the posters, but a food truck up on 80th and broadway. one of the guys there was tearing down the posters. the guy who works in the food truck and now people have made videos to say don't order from them. this is becoming a very -- it is a large issue. >> very tense. offers being rescinded from students. >> we saw that two weeks ago. >> there was an article that interviewed a lot of the food

truck proprietors. they had harsh things to say about some of them. this is surprising. >> i don't want to get into this. the journal has a piece. arab muslim student hurt in a campus hit-and-run. this cannot be tolerated. i don't know how many anti-semitic rhetoric. >> there was something like triple. >> the number of times the biden administration mentioned islamaphobia in the last few weeks. >> the increased number of incidents. >> compared to the anti-semitic attack globally? >> no, in the united states. i was surprised. >> i don't want to get on either side of it. the press secretary and some of

the others. >> she was questioned on anti-semitic. >> it harkened back to the obama years. he would not utter the words islamic extremism. i don't know where it comes from. it has good intentions or pure thoughts? i don't know. i do understand and i've been told and this is coming from another network, one you never had on your tv set. in swing states, particularly michigan, there are very large muslim population. >> axios was reporting in swing states, there is a bigger push back. some members of the squad are now facing a primary, including one in michigan. >> if that is what it comes down to though. >> the primary. >> i know. to imply that that's why you're

motivated to take certain stances that should not be dictated by politics. >> morality should rule the day. gm plans to invest $13 billion in u.s. facilities by april of 2028. the united auto workers said the investment said it is part of the recent agreements with the automaker. gm announced the planned investments, including $4 billion for assembly plant in detroit and one in tennessee for electric vehicles. other investments have not been allo allonno announced. gm did not comment on the details. the uaw revealed the plans to reassure the members of job security and pave the way for ratification of the deal for the 46,000 members at gm. lvmh opening up the luxury pocketbook for a deal. the company will acquire los angeles based eye wear maker

barton perreira. this is seen as the push into products with mass market appeal. lvmh wants to depend less on third party deals for eyewear and develop the inhouse operations. the brand was found in 1970 and has stores in new york, aspen, kansas city and boseman, montana. is this something we should know about? >> i don't. >> are you in the market for some eyeglass frames? >> i'm an owner. i am. >> for your far sightedness? >> readers. >> i saw some at walgreens. they are not prescription. >> warby parker. great frames. reasonably valued.

>> can i look better or worse? >> glance glasses could make so people look better. >> would i look more cerebral? >> you might. >> low bar. maybe. >> i have a pair in my purse. i'll let you borrow them. >> you have reading kbglasses? >> i don't use them here. low light areas. >> i find myself with menus. st sometimes i'll say bring me the usual. berkshire reported record operating profits in the third quarter. profits came to $10.76 billion last quarter. as for the closely watched cash word, berkshire is sitting on $157.2 billion. that is up from $149.2 billion set in the third quarter of 2021. i think it is up $10 billion

from the year ago numbers. shares are off from the peak set back in september. if you were looking at the earnings, it reported a loss than a year ago. that is because of the stock investments the company has. he says strip it out and look at the operating earnings and if they are doing better or worse. >> both of those things, number one, the stocks have been a difficult market and he obviously must think it is not a great time. >> the biggest reason they had an increase in cash is more than $1.1 billion came in from the treasuries that the company holds that are making money. >> $1.1 billion. you are talking $150 billion. >> they had that built up. the other thing that was strong was the insurance. geico turned a profit.

you have the re-insurance operations performed better. that brought in big cash. railroad not as strong. it does mean they have a very substantial chest. he always likes to have a certain amount. $60 billion of cash on hand. >> if we hear he puts 10% of that in bitcoin, that would be a big headline. >> that would be "the" headline. >> that would be bigger -- >> that's not going to happen. >> hope springs he eternal. it may happen. >> i pretty much know it won't happen on buffett's watch. >> larry fink. >> that would happen. as we go through life in 2023,

would anything surprise you? >> that would. >> that would. >> i would say no. >> i think it's tilted on its axis. i think something's wrong. i think we may go flying off into the cosmos. >> i would not argue there. we are flying off the cosmos to commercial break. well w we'll talk about that and the squawk planner and we will have lael brainard coming up later this morning. you are watching "squawk box" on cnbc. when you think of investment risk, do you consider climate risk?

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♪ ♪ this week's "squawk planner" here and what to watch. we will get reports from e-bay and robinhood. it is a light week for economic data. we get the latest international trade numbers tomorrow and the closely watched weekly jobless claims on thursday. >> joining us now on what is ahead for the week is matt dizac at merrill and bank of america. on equities, we have joanne

feeney at capital management advisers. matt, we will start with you. we really saw investors w whipsawed by what happened with yields going up so high and down quickly. is there a risk that higher rates loom around the corner again? >> i don't think we're done with the volatility. i think what happens last week increases volatility going forward. coming into the fed meeting, the market assumed the fed was done. they weren't sure of it. they were factoring a one in three chance of one more hike to go. two-thirds chance the fed was over. what they heard in the meeting convinced then the fed was done. it removed options. a 10% chance of one more hike. 90% chance of no hikes. that helped foster a massive rally alongside the treasury numbers that were a lot better than folks expected in terms of

issuance on the long end. a massive rate rally with those two together. in our opinion, that means if there has to be one more fed hike this cycle or two at the beginning of next year, the market is wrong footed. the volatility may continue. >> you think the fed could raise rates one more time and if so the reaction looks pale in comparison? >> it is absolutely the fed may hike one more time. the fed and market don't believe that. we have seen a lot of curve balls the last couple years. officially, that is bank of america's forecast on the research side. they think one hike in december. the market doesn't believe that. inflation is not contained yet. it is slowing, but not convi convincingly. there is strength in the services area of the market. again, it is not a done deal

yet. if the market thought it was a two-thirds done deal, no need to convince them it is absolutely done. there is a chance it will happen again and that could increase volatility. you could see the ten-year rate accelerate again. it was interesting. financial conditions tightened. they made a reference to rates being higher. that could substitute for rate hikes. the ten-year yield hiked ten basis points since the yield. does that mean they delivered two rate cuts by causing the treasury curve to move? they are chasing their tail. >> joanne, that makes for a difficult environment for inve investing. last week was the best week for the major averages with the stock market this year. what do you do? continue to follow the fed thought or earnings or do you look toward something else? >> i think you have to look at three things, becky. the fed, obviously, but

funda fundamentals. we are seeing good information both positive and cautionary. you have to look at fear which comes from the geopolitical risk in the background, but the incremental changes in the interest rates, but is the signal the economic data and the fed. that is will we end up in a recession or not? that is not recession or recession. that's why the equity markets are swinging around on the little pieces of information. for an equity investor, you have to do three things. invest for the long run and look beyond the noise and you have to be respectful of the risk the economy is facing right now. the consumer is resilient, but we are seeing crackcracks.

we see it in industrials and in healthcare. that is a caution to take steps to diversify around. >> what do you like? >> you can lock in income to try to protect against that. >> what do you like as a result of that? that is you doing the risk/reward scenario here. are there stocks that are safe havens? >> relatively safe. you can invest in the long term. microsoft or palo alto. think about what's driving the economy on the five-year period, not just the six-month period. put in protection. mcdonald's, tjmaxx. they will be more resilient. get income through higher dividend payers. phill phillip morris or abbvie. that's the way to build the portfolio. we do it stock by stock. customize it.

>> joe pointed out pfizer last week. the stock has come down significantly. you have a very high dividend payment at this point. is that a stock you like? >> it is. it is. we see the money they made off covid as creating this big dry powder and war chest enabling them to invest in new opportunities with m&a or drug possibilities or investing them themselves. we like that stock and a good one for the long term. it is going to be volatile based on clinical trials. >> joanne and matt, thank you. when we come back, elon musk's a.i. venture with the chatbot named grok. apparently, it also has an attitude. we will talk about that later. we will talk about the october cooldown and hiring for

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welcome back to "squawk box." elon musk's x yousef launching the chatbot grok. it is built to have a rebellious streak and answer spicy questions that other a.i.s might dodge. musk demonstrated the sense of humor with the jokes of sam bankman-fried with the question about a recipe for cocaine.

it does not provide the recipe. it tells you it won't do that and it provides a funny answer. the interesting piece, to me, if it is trained off twitter, or x, it means two things. one is it is more up to date and the question is an accuracy question and then the secondary question which is interesting fair use question. everybody who has been on x or twitter over the last decade or whatever has put lots of interesting information into it. it was considered a fair use situation to take a quote from a newspaper or book, often times the best quotes, and put them on to twitter. people would copy and paste the quotes. everybody considered that within the media landscape content world as a fair use way to do

it. they would send you off to said article or book or whatever. >> find the entire book or article. >> if 100 people did 100 different quotes from the same article and now it is in the hive mind of the system and because he owns it, is allowed to read it raises interesting questions. a couple of thoughts for the morning. >> i don't know it is that much more misinformed than the internet. the rest of the internet is a cesspool of information. the fair use point is an interesting point. >> what i think is funny is a babylon b type thing which puts me in one camp. what other people think is funny put me in this camp. you are back to tribalism for what is funny.

i don't know. if it is like twitter, i get enough of that on twitter. >> thanks, but no thanks. >> i don't want them to eventually kill me as a human. that's my biggest fear. they don't need us. they don't like us. they don't like feeding us. >> elon was in the uk at the a.i. summit. he is trying, i think, and you see it in the way he responds. >> you don't want his sense of humor in some circumstances. >> he is the one talking about guardrails. it is an interesting nuance issue of the guardrails and what that really looks like. >> this has nothing to do with rob gronkowski. >> no. coming up, there are many

lawma issues facing lawmakers. new poll is not looking so hot for president biden with a year to go. in fact, a generic democrat beats donald trump by eight percentage points. we'll dive into that next on "squawk box." >> announcer: executive edge is sponsored by at&t business. next level moments need the next level network. t's check says here it gets plenty of light. and this must be the ocean view? of aruba? huh. this listing is misleading. well, when at&t says we give businesses get our best deal, on the iphone 15 pro made with titanium. we mean it. amazing. all my agents want it. says here...“inviting pool”. come on over! too inviting. only at&t gives businesses our best deals on any iphone. get iphone 15 pro on us. (♪♪)

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former president trump is expected to take the witness stand today in a manhattan civil fraud tried trial. the president will be testifying under oath. cameras will not be allowed. democratic new york attorney james said trump inflated his worth for years. trump rejected the claims and waged a crusade violating a gag order and racking up multiple fines. strong words from president biden reacting to the new york

times and sienna college poll suggesting he drop out of the race. he was asked about the age of the candidates as well and another trump versus biden election. we have donna edwards and former white house chief of staff mick mulvaney here with us. congresswoman, there are two types of democrats. some that are really behind the president because of a lack of alternatives, i guess, and doubled down whenever you mention he shouldn't run. they actually beg some of their fellow democrats to stop bringing it up almost like ostriches. and some like david actixelrod say he should step down. >> if you look at that, that is

not what david is suggesting. he said that was unrealistic. i do think there are some concerning things in the poll and i don't think anybody should hide from that. to me. it is con the ciconstituencies is not considering. i think focusing on those con the stituencies as we are a year out is important and that gives the biden camp the opportunity to focus on those things in the next year. he will be the nominee just like donald trump is the nominee he of the republican party. we have to get a grip on that. biden needs to put his head down and bring back home the natural

democratic partners. >> mick, even the loss that the president has seen is trump's gain in african americans and hispanic. even suburban women. he's in the public eye because of all of the litigation. he is not tweeting. he's not president. you are not seeing what it was like in a trump presidency every day. he has been out of sight and out of mind a little bit which allows him and maybe by comparison, you think this guy wasn't that bad, his policies, anyway. if we were to refocus on everything and hearing every day, do you think his numbers would hold up in november of next year? >> the one thing he doesn't want to hear is he is out of sight and out of mind. he would hate to hear that from you. do you can win?

absolutely thinks he can take t trials against him and turn it into a positive. he is casting himself as a victim of the weaponized government. i never thought i would see that. at the same time, joe biden cannot get out of his own way. his age is clearly an issue. it is not just david axelrod. ignatius wrote a piece in the post. you don't get more democratic establishment of david ignatius writing about how biden should step down or step away from the election. everything is going trump's way. it looks like trump versus biden. i think trump is more likely the republican nominee. it is a close toss up just like the previous two times. >> i like the way you quickly said centrist. i don't mean centrist.

another word. >> i was looking for establishment. >> i just watched you do that. i was thinking the same thing. i don't know about that. who would be, mick, if it is not president biden and it probably will be president biden, but if not president biden, whom? >> you can go down the list of names of candidates and hear michelle obama's name. she has no interest in running. oprah winfrey's name. she has no interest in running. gavin newsom or gretchen w whitmer. this would not be a primary. this would be the democrats selecting after the convention which makes it more weird and disturbing. that's the 21st century american

politics. >> donna, mick didn't even mention the vice president. >> first of all, whatever the pie in the sky, who have, could have, should have, joe biden will be the nominee of the democratic party. here is where kamala harris is interesting with the new york times poll. she shows to have a lot of appeal to women and african american voters and hispanic voters and young people. i think that's actually something he will lean on even more. i think a year out and this gives the marching orders to the biden campaign of what needs to be done in the course of the next year. biden will be the nominee. it makes me crazy hearing the silly talk of would have, could

have, should have. >> you are okay if he is 86 or 85 at the end of his term, donna? no concerns? >> i do not have -- >> day in and day out. >> what we have not talked about is trump is three years younger. they are both old guys. >> don't do what about -- what about president biden responding to things we are seeing in the world right now when he is 85 years old. >> i do not have concerns about joe biden at all being an effective president over these next several years. i just don't. >> you think they should keep saying bidenomics is great. we can't believe you don't know how great things are for you? is that how you sell it? >> i think it is important to acknowledge the way people feel about the economy.

look, we're not going to be in the business of telling people how they should feel. we need to acknowledge how they do feel about the economy and some things need to click in the right way over the next year to make sure the economy gets ticking in a way that people feel it in their personal lives. that's what that poll revealed to us. i am not going to tell anyone to ignore what people are saying about how they feel about their own lives. >> what do you think, mick? if you were -- i don't think it will happen. i don't think the president will come to you and ask you how to help with the campaign, but if he did, what would you tell him? >> actually, i agree with done donna. you can't tell people how they feel. my fear for them, tif i'm a democratic chief of staff, we don't have time to turn things around. people will feel like they feel today in a year from now unless

something dramatic happens. they have a real problem. they have problems in some groups. you hear democrats talking about this and that's when you know it is serious. it is wishful thinking that biden has trouble in michigan. biden has trouble in michigan. they have difficulties all over the place. six months ago, joe, i think biden was a slight favorite. >> mick, i called this a disconnect. maybe it is intellectual 00iz,00izing the situation. you say this is a super strong economy. you say there is inflation in there. on a relative basis over the last 10 or 20 years or maybe 50 years, there is something good

going on. there is this other feeling and what i can't tell is that relative basis to just three or four years ago and we were living in the pandemic and as terrible as it was, we had the government writing checks to people like crazy and the stock market was going through the roof and all sorts of things were happening that were alice in wonderland and don't make sense. is that the relate tivrelativit? >> i think it is the distance of time and the time we had to deal with inflation. the generation of americans who have never experienced it first hand. everybody on this program has. a lot of people have not. what they cannot get over is the fact that milk is $6 a gallon. they have never seen that before. they know it is not coming back down. they don't understand. they will blame the incumbent party and the president. that is a big part of it. unless you get inflation under

control quickly, it will not change. >> milk is not going down. >> we had real wage gains for last three months. the first two years of biden's presidency, were you below. trump's presidency has wage gains. >> a massive inflation and check-writing campaign -- >> which is what we are seeing now. >> different kind of check writing. one directed to you and you got that check. you were feeling flush and great. it was a very odd period to be living in. >> if you have taxes on corporations, that will pay off. spend money like we're doing now. >> that economics is a different economics. you are not seeing that for another decade. a totally different type of economics. >> i would leave it in the private sector. mick and donna, thank you.

we will not -- we're all on different sides of this. we love each other. sit at a ro >> thank you both. when we come back, we hear more about president biden's sales pitch on the economy. white house economic advisor lael brainard will join us in the next hour. "squawk box" will be right back.

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coming up, words like last, best and final are thrown around in the 116-day sag-aftra strike. more damage is done for the ctseor and who will weather that storm? that's next after this. my brother max recommended you. so my best friend sophie says you've been a huge help. at ameriprise financial, more than 9 out of 10 of our clients are likely to recommend us. our neighbors, the garcias, love working with you. because the advice we give is personalized, hey, john reese, jr. how's your father doing? to help reach your goals with confidence.

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welcome back to squawk bach, hollywood studios met with sag-aftra. the union still reviewing, while more movies are getting delayed

as the impact of this ongoing strike continues. joining us now rich greenfield. at this point when do you think a deal gets done, and just -- i mean, even if a deal gets done, what are we talking about in terms of the calendar both in production, distribution, what does it do to earnings as you look over the next 12 to 24 mo month. >> this past weekend was supposed to be dune 2 weekend. it got pushed out until march. you had one of the slowest weekends of the year at the box office. the problem with the strikes, i'm sort of tired of the best and final. i feel like we've heard things like that before. i'm hopeful but ten days ago the studios were saying it's going to happen this weekend or it has to happen within the next few days. here we are ten days later and we're still hoping that an end is in sight. the reality is given where we are in the calendar, no major,

you know, hollywood production is really getting off the ground again until the beginning of the 2024. the problem that presents is there's a lot of movies that are just not finished for the second half of 2024, and so, you know, box office is probably going to end '23, down somewhere north of 20%. i would guess between 20 and 25%. the problem with 2024 is with the lack of movies, you could be down another 20 to 25% or more in '24 off of '23. these are numbers that are so catastrophically bad for the movie theater industry. obviously it impacts all of the big media companies, your parent company included. if you're not releasing films. while it's good you can't lose money on a film, net hollywood makes money in the motion picture business, not a huge margin, but there's just more and more likelihood that films in the second half get delayed,

and that's not good for the entire industry for sure. >> one of the things that you've talked about, at least were talking about i would say several months ago, still talking about it, is just what it's also going to do to streaming is and streaming s subscr subscriptions, which is to say at some point do you look at what's in the library if you will, you get on the service. you click around, there's nothing left for me. i'll take a pause on this one. maybe i'll come back to this service later. do you see that happening yet? do you see that happening in six months from now? if so, who do you think is the most susceptible to that? >> well, i mean, the reality is you're seeing less and less content across the industry on these streaming services. it's had an impact. it's having an impact on all of these streaming services. i think it'd be hard not to miss. it's having an impact, and i think when you look forward -- >> it was like the worst thing

i've ever seen. >> when you look forward over the next several months i think you're going to see more and more of a drain on these companies. it's going to impact. it's also why you're seeing them take alternative plans on katd l catalog. you're seeing more and more catalogs being licensed from netflix to amazon. they're looking for new ways of making money because their core streaming businesses are not as robust as they had hoped. the product's just thin. netflix benefits from having a lot of overseas content, andrew, but even netflix is going to feel the impact if production doesn't restart soon. >> are you imagining we're going to start to get quarterly results and start hearing about not just growth slowing down but we're going to talk about a reverse? a reversal? >> it's hard. a lot of it depends on what you do. you're seeing a lot of deep discounting from these streaming services, sign up for a full

year at a meaningful discount. you've seen them launch advertising tiers at far lower prices in order to attract subscribers. so it isn't as simple to say, you know, even disney's starting to explore canada, they're starting to explore password sharing the way netflix does. there's a lot of moving pieces. i think growth has largely stopped for streaming. that's obvious. >> if that's the case, these stocks we've now cycled through on the screen, netflix, walt disney, paramount global, warner brothers. comcast parent company, this network a little bit of a different story given the cable piece of it, its business, the actual wires it is. which ones do you like based on the price? we're at netflix at $433. disney's at 85. warner brothers sitting just about $12. comcast at $43 now. >> all of this is making netflix stronger, you know. if you think, andrew, we used to

get on with you. think about three, four years ago, nobody wanted to license anything to netflix. like literally nobody. everybody was keeping everything they made for themselves. they've realized that keeping it for themselves, the streaming services whether we're talking disney plus, whether we're talking peacock or paramount plus. there's not enough reach of these platforms, you're seeing all of them turn back to netflix, back to amazon. they want to license more content. they don't have enough engagement on their own platforms. it's good for the content that they own. it's not great for the streaming platforms. it's really good for the content they own. that's going to make netflix a really powerful company as you move through 2024. they don't have a choice. they have to. >> we got to run, we got commercials, pay the bills, what bills there are. >> i like ads that are targeted, andrew. >> thanks, we'll talk to you soon my friend. when we come back, european

low cost carrier ryanair reporting results this morning. michael o'leary will join us on set to talk about the results. and later, nec director lael brainard will give us her read on the economy following the jobs report. "squawk box" will be right back. - so, the question is... - cyber attack! as cyber criminals expand their toolkit, we must expand as well. we need to rethink... next level moments, need the next level network. [speaker continues in the background] the network with 24/7 built-in security. chip? at&t business.

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good morning, futures pointing to gains to start the week. all major averages are on at least five-day winning streaks. we got that major market rally on friday to end the big week of gains. in fact, the best week of the year, investors paying special attention to bond yields. let's talk about those and what's changed recently in traders' economic mind-set. shares of european low cost airline ryanair are flying higher now. the company posting record first half profit and announcing a new dividend. it's the first time ever they're paying a regular dividend. we'll be speaking with the ceo as the second hour of "squawk box" begins right now. ♪ good morning, and welcome

back to "squawk box" right here on cnbc. we're live at the nasdaq market site in times square, i'm andrew ross sorkin along with becky quick and jo se kernen. s&p looking to open nine points higher. the nasdaq would open 41.5 points higher. last week was the best week of the year for all three major averages. the dow up more than 5%. the s&p gaining close to 6% and the nasdaq up close to 7. let's show you treasuries right now, risk-off, risk-on situation. ten-year at 4.595. the two-year coming down from what was over 5 at one point. oil 81.60. we talked about saudi and the like saying that they are going to hold on oil right now, and then crypto, take a look at this, the risk-on, risk-off thing, at $35,239. we also have some stories that

investors are going to be talking about this morning. gm planning to invest roughly $13 billion in u.s. facilities by april of 2028, the united autoworkers union saying the investment, part of that recent tentative agreement with gm, the automaker has already announced some of those planned investments, including $4 billion for a factory in detroit and $2 billion for one in tennessee. meanwhile, lvmh is buying los angeles-based eye ware maker barden. i don't know how to pronounce this fancy name, carrera for about $80 million. seen as a part of the luxury giant's push into products with mass market appeal, we're going to talk to robert frank later about this deal and why it's so significant, and then mark zuckerberg, for those on instagram over the weekend or facebook, recovering from a torn acl. the meta ceo reveals his injury late last week on an instagram post. he said he tore his acl sparring in a mixed martial arts training

fight. also said he hoped to participate in a competitive mma fight early next year, but now that would be delayed, and that's what he was training for. joe. >> ouch. as we mentioned moments ago, we're coming off one of the best weeks, the best week of the year for the major averages and now multiple factors that scared the bond market and drove bond yields higher seem to be less worrying for investors. yeah, pretty amazing, steve, 45 now, i guess it was 4.59, but still, that came very quick and very unexpectedly on the ten-year. >> yeah, i want to walk through that. it was an interesting week. three factors that drove the ten-year yields higher and helped stocks to rise all improved last week. they haven't completely gone away and presented new uncertainties for the market to digest. what drove it lower last week. we had weaker jobs and weaker isms. they help with the growth story. the fed gave us a more dovish

outlook in the statement and in the press conference, and then the treasury solved an immediate problem by providing less supply on the long end and saying that those long end coupon auctions wouldn't keep going up after one more quarter. you can see the impact of all three on the ten-year yield last week. take a look, took a first leg down with the treasury refunding announcement, another leg down after the fed meeting and a third one after the weaker than expected jobs report on friday. the result was to move the december outlook for fed hikes 7% for december, 12% for january meaning the market now betting pretty confidently the fed is done here. but hold on, those three areas now create new uncertainties you have to think about for the market to navigate. now the question is how weak we go with the jobs report. could the yield decline mean more hikes, joe was pondering that in the last hour, and how long will the treasury be able

to not rely or lean on the long end. the treasury manages the near-term problem for funding the debt, it doesn't do anything to resolve the longer term issue of the u.s. government's rising massive obligations, and of course flagging revenues. there's going to be no all clear on the fed definitively until there's an all clear on deflation. i think you know this, exclusively tomorrow with austan goolsbee, chicago fed president. >> president goolsbee is going to be on tomorrow. >> get used to it. >> i'm with that. i'm down with that. we're going to have ed yardeni, he's just one of the average people -- he's not the president -- have him on in a second, first thing i'm going to ask him, one of the things he's saying is he's kind of shifting his focus away from what's been controlling everything, interest rates and the fed to oil and what happens from geopolitical

insanity that we're seeing -- earlier. i said something about a war and i had to say which war. just in that statement right there that speaks volumes. we have to, you know, be specific about which war we're referring to. >> i'm interested in what ed has to say, but i think at the moment there does not look to be a sort of over arching impact of the geopolitical uncertainty, at least on markets right here. to the extent they've reacted, they've reacted in strange ways, right? you haven't seen the flight to safety into the ten-year that we've seen on previous increases of that uncertainty, and oil, i think, last i checked was reasonably well behaved, joe. >> i know. >> and i think -- and i think, joe, that's a result of the enormous amount of domestic production we have in this country, right? because you used 70s as an

ana analogy. there were concerns and there were actual oil boycotts, and we have trouble with our supply, but now we are really -- we're the largest producer in the world, and we're importing much less oil, so the supply issue, at least in that regard is off the table, while price remains, of course, i think an important one. >> if you talk about supply is one thing, but even demand might be playing into it. >> yeah. >> if the jobs number was really telling us something. and you know, maybe some of that flight to quality you're looking for, maybe we did see that. maybe that's one of the reasons we're at 4 and 5 instead of 5%. something for everybody. and i mean -- >> joe, can i -- >> can i stop you? >> do we have to run? because i want to weigh in on something you guys were talking about, there was a great conversation with donna edwards and mick mulvaney.

>> donna edwards. it isn't just one thing bugging americans, it's a whole series of things. inflation is just one factor. we found that in our all america poll. inflation is wjust one of the things out there. we found that there are multiple things that are bugging americans. there's job security, housing costs, debt, retirement savings, and those are relatively low, all relative to inflation, but when we add them up and find out how many people are experiencing these financial stressors or multiple financial stressors, about 46% or 47% of the public is experiencing multiple numbers of these things. so there you go. if you look at it 26% of moderates just three or four of those elements. take those two bottom ones and add them together. it's 47%. they're aware that the job market is better than it was before or is pretty good right now. but it's the multiple ones, and

those people experiencing in those two categories at the bottom there, are key democratic constituencies, they're african americans. they're hispanics, and they're especially single women who would, you know, otherwise be very strong when it comes to democratic support, but then you have single women are among those experiencing among the most financial stress out there. >> we notice. we notice. i went -- i'm going to stop in and get some milk and a couple other things and it's $70. i don't even know -- maybe i'm doing it wrong. have you noticed that? >> you're not doing it wrong. >> i do my own scanning and everything. i told you why. because i'm good at it, really good. >> do you know that they are now starting to roll back some of those self-checkouts. it's kind of like a failed experiment in retail. >> is there shrinkage? >> there's theft. >> you're on the camera going the whole time. >> hey, steve, one separate question because we were talking about -- are you still with us?

>> yeah. >> the relativity of all of this, so all of us, the folks who say that they're feeling financial pain, is that solely -- you're saying they're feeling financial pain. you're saying it's not solely a function of inflation. i'm trying to understand what the other piece of it would be. the other thing that happened which i think has to be sort of spoken about is people, dare i say over spent, and during the pandemic and afterwards, we went on this -- the whole country went on this sort of weeird yol spending spree. people spending far beyond what they could have. it would not shock me if they feel today that they are having financial pain or at least anxiety about where things are because, you know, the money's not in the account the way it used to be and everything costs more. >> i think that's a good observation, andrew, but i think what you want to do is think about inflation in context of how it impacts other elements of

financial security. if inflation is high and costs are going up, then you have financial stress in your household earnings, which is another factor. i don't think it's on the screen there. it also creates an issue with your retirement savings. so all of a sudden in key areas of your financial life, you're falling behind and feeling stress in those areas, and among those feeling stressed are those least able to make up for that, andrew, so yeah, you're right, it's a relative change, relative to how things were during the pandemic, but it's also an absolute change. unless you could not just bring down the rate of inflation, but the thing that's made people angry is the level of prices. so if you really want to make people happy, what you need to do is target the price level to bring down milk. forget milk going up more. it's the absolute level that's caused a lot of the stress out there. >> caught yourself. >> peeve second is a good word.

>> peeved anyone can say. >> ticked off. >> peeved off. >> teed off. >> he said -- no, he said -- >> thanks, steve, we'll see you later. when we come back, former s.e.c. chairman jay clayton will join us on the ongoing corporate impact on the israel-hamas war. the ceo of europe's ryanair will join us live on his company's latest results and the travel trends he's seeing as we head into the liy hodaseason. stay tuned you're watching "squawk box" and this is cnbc. we got this. we got this. we got this. life is for living. we got this. let's partner for all of it. edward jones

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all right, welcome back, everybody. check out shares of low cost european airline ryanair up by 8.5% this morning, along with its latest earnings announcement, the company is also forecasting a record annual profit. for the first half of its fiscal year, ryanair said earnings were up nearly 60% from its previous record. it was helped out by higher fares this past summer, and for the first time the company also says that it's going to start paying investors a regular dividend. joining us right now is michael o'leary. ryanair holdings group ceo and welcome, michael, and congratulations. >> becky, great to be here, nice to see you all again. >> fares were up 24% this summer. what happened? this is low capacity. >> capacity is heavily

constrained. europe is operating 92, 93% of pre-covid capacity. without ryanair's growth that would be probably only 90%. people are dying to go traveling again. families are going back to the beaches in europe, but there's less seats available. and stronger pricing. we've added 23% more seats than we had pre-covid. so delivering very significant growth. the other airlines, the legacy guys are pushing you have air fares sending more is and more people to ryanair to low fares, great on-time flights. >> you have been pretty vocal in your criticism of boeing in the past about not being able to deliver the aircraft you ordered. i think you're getting ten of the boeing planes by christmas instead of the 20 you expected? >> yep. >> where does that leave you? >> it's tough. boeing has a lot of production issues. we're supposed to get 57 aircraft by the end of april. i think we'd be lucky if we get 47, 50 by the end of next june. we said we're not taking aircraft after the end of june. we're too busy in july and

august. we're working closely with boeing. dave calhoun i think is doing a good job. the production challenges in wichita and in seattle, they've had two years after covid to sort these production issues out, and they're still challenged. it's very difficult if you're a big customer of boeing. we want to take more aircraft and growing, but boeing keep missing these delivery dates. it's very frustrating. >> i guess that's a better scenario than the planes you have to take out of service because of the pratt & whitney issues there. >> it's got to play to real capacity. pratt & whitneys are on the air bus fleet. we're the only significant 737 operator in europe, and we think a lot of our competitors in europe next year will be grounding a lot of aircraft, up to 10% of their fleets next summer. the backlog in engine repair shops is ginormous. it's going to take a year to do these engine repairs. and there's no system. i think there's going to be less seats available in europe next year, which hopefully will point to another strong year for

ryanair if we can get these 57 extra aircraft for boeing. >> it's such an interesting situation. you're the low cost carrier and here in the states a lot of low cost options are feeling the pressure. that's the segment of the population that is starting to get a little more squeezed. i guess you're immune to that because of the capacity issue that keeps all of that at bay. >> we're not immune to it. i think what happens in europe, you have the air frances are pricing up so aggressively. nearly doubled air fare in the german market. germany is operating at 80% of its pre-covid capacity. they're sending capacity to ryanair. this summer our fares go up 24%, but that's a 24% increase on a much lower air fare than lufthansa is and -- even if the consumers are pinched, which i think they will be over the next year or two.

more and more people are going to trade down from these high fare airlines in europe to flying ryanair. we're the number one in most of the european markets across europe. we expect to him 200 million passengers next year. >> the idea of paying a dividend for the first time, a regular dividend for the first time, why? >> i mean, one, because generating so much cash. we paid down about 2 billion in debt in the last 12 months. we're able to fund our capex. we've been at this for 33 years. today we sit on 3.5 billion in cash. our commitment has always been to shareholders if we have spare cash, unlike other airlines wasted doing m&a doing stupid things. we returned about 7 billion to shareholders and buybacks over the last 15 years, and we're starting that again now as we emerge out of covid and hopefully a little bit more predictable earnings for the next couple of years. >> what have higher oil prices meant? >> they've meant higher air fares in the short-term. we've been very good at hedging. we're fully hedged to march at

$9 a barrel. we're well below market rates. we're 50% hedged into march 25 at about $79 a barrel. we use a strong balance sheet to hedge and we pass on those hedge savings to our customers in the form of lower air fares. >> what would cause you to say i'm going to air bus, forget this. i'm going to go air bus. i' >> joe, the day air bus come in 5% cheaper than boeing we'll be speaking french. >> it'd be -- wouldn't it be kind of patriotic to go eu with air bus or something? >> when the booking flights don't worry too much about the pate patriotism. >> you're all in this together. >> it'd be much nicer if i have all 737. i'm the only boeing customer. there's a real cost savings for us. all the other airlines are

operating air bus. they're all pinching each other's pilots. it's much higher to pinch ryanair 737 pilots because you've got to spend six months training them. boeing need to have a big champion. >> i'm not trying to talk you into it. >> if air bus come in 5% cheaper in boeing per seat, we'll be buying air bus. at the moment we have 650 -- >> do you think they're watching? >> i don't think so. i mean, they're convinced that no matter what they offer us, we'll show it to boeing, which they're dead right, we would. >> oui oui, i don't think they're watching. >> give me something that's 30% cheaper to boeing, we'll show it to boeing. we've been committed to boeing now for 30 years. >> i can get you a russian airliner for 10% cheaper. >> if it was free, i wouldn't take a russian aircraft, thanks very much. boeing build great aircraft. they do have production challenges, but i'm confident under dave calhoun they'll sort them out in the next 12, 18 months. >> you're the true maverick.

you're like the herb cal her who was true to southwest through and through. you have not changed your stripes. >> too many people standing outside the bathroom jumping up and down, i don't have a quarter. if you want to use ours, pay up. >> i've been in it free, got there already. >> for you it's a dollar. >> they charge you for the makeup which i thought was -- >> did you bring a bag? they charge for that too. >> it all works. >> it all works, right. >> that's why you give people these options and they'll keep taking the lowest fare. that's why southwest has built a great airline over the last 30, 40 years in the u.s. what i don't understand is southwest p/e multiple is 15 times and ryanair is 8 or 9. got to do better. >> the biden administration is pushing for all sorts of rules talking about the lowest fares. it is look low and once you start to add them up, they go higher and higher and you don't see it. are the rules in europe different than here? >> they're exactly the same. we set a 1999, 20 bucks air

fare. if you want to check in a bag, it's extra. but it's your choice. there's no hidden extras. people keep rambling on about these hidden extra. nothing is hidden on ryanair. if you want a bag, you pay for it. >> free and open rest rooms, you saw it happen on that one flight. >> delta flight. >> we have free and open rest rooms. >> thank you, pleasure to see you. >> thank you. >> thankfos r your time. "squawk box" will be right back.

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welcome back to "squawk box." i'm dominic chu. let's start your monday morning movers with a check on shares of tesla, with the electric vehicle giant up just about 1.5%, north of 1.2 million shares of premarket trading volume. the stock appears to be reacting positively, at least in part to some headlines out of reuters that tesla is planning to build a cheaper version of its evs at its german factory near berlin. the new model would cost in the range of 25,000 euros. those shares up 1.5%. on the analyst front this morning, we're keeping an eye on shares of banks across the

board. they had a great run last week amid the broader stock and bond market rally. new this morning, analysts at kbw have upgraded shares of regional key to an outperform from market perform. the target price goes up from $15 to $12.50. they're citing a better macroeconomic back dprop longer term interest rates remaining low. on the big bank front they're also upgrading bank of america from market perform to underperform while ups the target price from a dollar to 30 bucks. key corp. up, we'll end with food and beverage, blooming brands, the parent company of outback steakhouse, other chain restaurants gets downgraded to outperform from a strong buy. the target goes down a buck to $28. it's on the heels of the earnings release last week. they think continued underperformance and customer traffic and continued

inflationary pressures will continue to be a drag despite decent valuations. blooming brands down 1.75%. keep it here. we've got more after the break on this monday morning.

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treasury yields this morning, 4.59 on the ten-year. our next guest coined the term bond vigilantes. he said that they did back off last week, but could return over concerns about the federal deficit and political gridlock. joining us now is ed yardeni, president of yardeni research. you also said, ed, that maybe it doesn't supplant the angst about interest rates, but oil with the geopolitical concerns, oil could become more important in determining which direction the markets are moving at the point, but you still think bonds are -- we could see the vigilantes come back with 33 trillion in debt. >> well, yeah, i think so. they're not necessarily done voicing their concerns about debt and the deficit, just because we had this tremendous rally in the bond market last week doesn't mean that problem's gone away. clearly the -- one of the main

reasons that we had that rally last week is the treasury recognized that the bond market wasn't happy with all the supply and they cut back on the supply, so that was just a very short-term response to that. in addition, we've had some weak economic indicators and it looks like the fed is done, so the bond vigilantes are not the only players in this bond market, clearly, but they're not gone. >> it's nice to be able to cut back on supply, but that's not going to work forever. there's going to be a certain amount of supply when you're talking about $33 trillion. there's going to be a large supply that needs to be issued. >> well, absolutely. i mean, look, janet yellen could just i guess finance everything in the bill market and hope that short-term rates go down rather than go up or stay high, but the reality is one of the most disturbing things about the deficit and the debt is that it's kind of compounding as

interest rates have gone up because we've got so much debt, we're seeing that one of the biggest outlays now in the government is just paying interest, and so that's not going to go away, you know, they're going to have to continue to pay their interest. >> we haven't seen much in terms of -- the oil market has been oblivious to the biggest events in the middle east in 40 years pro probably, why? >> well, you know, it is a bit of a head scratcher. there is a lot of concerns that the war between hamas and israel will turn into a regional war. i guess the market figures that if somehow iran's oil production or oil exports get disrupted, you'd kind of imagine that the biden administration, which loosened up on some of the restrictions on sanctions on the oil coming out of iran that they

would tighten things up pretty aggressively here. i guess everybody figures that the saudis would start pumping more to keep the price of wealth from going up. i think the saudis learned so far this year that the market just isn't going to be able to handle $100 oil. china's weak, europe's weak, the u.s. is relatively strong but maybe slowing down somewhat, and then of course the consumers demonstrated that, you know, once the price of gasoline goes up, guess what, they drive less, and a lot of people are working from home so they don't have to drive as much. so i think you're making a very good point about watching the oil price as an indicator of just how concerning the middle east war is in terms of its geopolitical impact, but also in terms of its economic impact. >> well, we never know whether it's supply -- it's always both obviously. whenever it moves one way or another, we're not sure what to attribute it to. at this point you still think

the fed can successfully land this baby and it will be a soft landing? >> yeah, i think that's been the contrary scenario, nobody ever believes the fed's going to get it right. as long as they don't say mission accomplished, i think we'll be okay. as long as they don't jinx it. >> a banner, saying it's one thing. >> yeah, so i think they're actually getting it -- i don't want to say mission accomplished, but i think they're getting their soft landing. >> and then what is that soft landing look like, 2%? with 33 trillion in debt and higher, permanently higher interest rates let's say, what does that get tus? >> well, right now as you said, the obvious conclusion is not much. i don't think it gives us a recession, but it's certainly hard to see how the economy keeps that pace of the third quarter up, you know, 4.9% is just not sustainable given the points you just made.

however, one thing i'm quite optimistic about is productivity. productivity could be the surprising variable, surprisingly positive variable. it was very strong in the third quarter following a quite strong fourth -- second quarter productivity number, and as we all know, there's a labor sh shortage and companies are solving that problem with technology. >> wow. you're pretty -- i don't feel that scared all of a sudden. that's good. >> you shouldn't be. >> no? >> i'm scared about everything else. i'm scared about everything else but, good, thanks, ed. one of the hottest growth sectors in luxury, and robert frank is going to join us with the details right after this.

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experience the art of high pressure brewed coffee and espresso with the l'or barista system. enjoy richer, bolder flavors complete with velvet smooth crema. now brewing peet's coffee. a big luxury deal to tell you about this morning, robert frank joins us right now with more. hi, robert. >> good morning, becky. good to see you. lvmh is expanding its luxury dominance into the fast-growing

eye wear market. the california-based maker of james bond sunglasses and designer frames favored by hollywood celebs. their glasses typically sell for 5 or $600 a pair. this is the second acquisition in just two months by lvmh's eye wear division called thelios. the global eye wear market now tops $100 billion a year. it's growing fast. sunglasses are becoming a lot more popular in asia and more people are wearing specs due to more screen time, and eye wear is often the first purchase that consumers make when they enter a luxury brand. >> eye wear is in many cases first with the consumers. so you have a growing number of consumers in global markets that are approaching the luxury with categories like eye wear. on this sense we are able to recruit more consumers and the

market's going through this trend. >> founders bill parton and patty per rare will stay on board. lvmh plans to take them global, open a lot more stores. this is just one of those segments that between sunglasses, we all know those margins are incredible for what it costs to make a plastic pair of glasses, combined with the growth especially in asia makes it very attractive. >> i hadn't thought about the idea that that is the first touch point for most people buying their luxury brand, i guess, even though it's a huge markup, it's relatively the least expensive item versus a bag, a pair of shoes, a designer outfit. >> sunglasses and makeup and fragrances too are often those first entry points and that's why lvmh has made a big push into those categories. it's their onramp into these brands as first-time consumers and they start buying more expensive stuff. >> in asia they're wearing more

sunglasses. >> apparently it wasn't as acceptable or popular or cool as it is here and now especially in china it's become cool. the growth there is quite strong. this is a part of lvmh very under the radar. i didn't know about them until last week, this company thelios, they started making the in-house brands like for dior. they realized we have such good growth, in two months they brought var nay, and now barton pereira. the 800 pound gorilla in the room, they own ray brand, oakley, sun glass hut, there's a lot of room to grow. >> thank you. coming up, former s.e.c. chair jay clayton will join us on set. a lot to talk about with him including fighting anti-semitism on campus and the rise of ai. don't go anywhere. "squawk box" will be right back.

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tides of anti-semitism at colleges. the firm said as recruiters they look to law schools to ensure graduates are ready to work in environments that have no tolerance for discrimination or harassment. joining us with his perspective, former s.e.c. chairman jay claytoc clayton, also a cnbc contributor. one of the instigators of putting that letter together. what do you think the impact of the letter has been? have you heard any feedback from the deans? where is this all going? >> i did see some feedback from the deans no. not all deans but one of the pieces of feedback was so what do you want us to do about it? i think there's clear time for in in introspection here at the universities. one of the things that strikes me is you need good governance in times like this. how do companies, well-run companies deal with the problem? they rely on their governance function. you mentioned the word strategy right at the top, like what is

the strategy for the university in dealing with the objective search for truth and not allowing hate and violence to be preached on campus? like you need an effective strategy. let me tell you what's not an effective strategy, let's have one side talk and the other side talk and we'll see what happens. that's -- you know, the marketplace for ideas is not just where the loudest voice wins. the marketplace for ideas is where you hear things and then you search for objective truth. i don't see that kind of governance from our universities today. >> literally said so what do you want us to do about? >> i've seen that. what do we do about it now. if you don't have core values, core moral values and a strategy for what the university is supposed to do, you don't have any touch tone. you set that up. and some have it, but the governance here, look, boards of directors at universities they vary greatly. boards of trustees, where is the engagement? >> let me ask you this -- there is a -- one of the strains of this conversation if you were to

read bill ackman's letter or you understand marc rowan, understanding of these issues, one of the great frustrations especially among folks who are jewish, i'm jewish as well, is that there has been not free expression on campuses prior on other issues. >> absolutely. preferred ideas. >> and as a result there's a view that there wasn't free expression then on these other things so how dare they not have free expression -- or how dare they then allow this sort of free expression which i consider -- some of this is hate -- is hate speech, but nonetheless, that they allow this over here, won't allow this over here, but they will allow this over here. >> it's remarkable hypocrisy. >> hypocrisy. but the question then is which version do we want, right? because if you really -- if you really get underneath some of this, there are some people who are effectively saying, well, actually, we want free

expression on everything but actually we don't want it on this, and then there's other people saying, actually, we really aren't into free expression, we also don't want free expression on this. you with me? >>okay. >> that's not an easy answer but it's the very thing we set up universities to do, to grapple with those types of issues, which is okay, we do have a free marketplace for ideas. when you say from the river sot sea, what do you mean? do you mean i want a two state solution, peaceful solution or the eradication of jews? no, that is -- that is why we have universities. >> that's why this is immensely complicated because there are some people who are writing hashtag free palestine and what they mean is that they -- they don't want -- they want a free palestine but there might be for a two-state solution or something else, there are others

that just that hashtag free palestine really means from the river to the sea and from the river to the sea means kill all the jews. >> no israel. >> look -- >> and we have to reject one and discuss the other, that's what universities are there for. that's why we need strong leadership. >> it goes back years. condoleezza rice cancelled an appearance at a college because she wasn't palatable to the -- whether it's the -- i don't know who's in charge at that university, i don't know what the kids are learning at that university, dozens of conservative commentators are not welcome. >> but people that say go hamas, something is very wrong with the fabric of what's being taught at universities. right? >> you're not going to fix that. >> but this -- we have -- this is why you have leadership at these institutions and it's time for the leadership of these institutions to step up. maybe the boards of directors. boards of trustees aren't

functioning as they should. in a corporation that's what you have. we've clearly gone awry. >> it gets back to the loudest people. that was jutrutgers where that happened, that was the loudest voices at that point creating chaos. >> the marketplace of ideas is not the marketplace of the loudest voice. >> the question, how do you enforce this? what do you want to do? doupt to say that -- this is where it's complicated. any language that is, quote, anti-semitic, my position, is anti-semitic is unacceptable, and, you know, due for a suspension or worse at the university. the complicating part is now to define what that actually means because to me -- and then there's the comfortability or uncomfortability of being on the other end of it, right, and what that means. i'm asking you. >> look, the way you -- >> can't just be asking the questions, i can ask the questions all day long, it's

very hard to come up with the answers. >> it's free palestine. >> step forward and say it's complicated. >> you say it's complicated and some people will tell you that's n not good enough, people want ans answers, and they want a very clear answer, that is actually is the problem. what went with the president of penn and the president of harvard, they equivocated because the truth is there's a complicated element to this. >>let go one step further. there are things that are complicated but there are things that are not. okay? >> oh, oh -- >> is terrorism complicated, it's not complicated at all, it's absolutely wrong. no doubt about that. are there discussions about the ways forward that, you know, are complicated and can make people uncomfortable? yes. but universities are places where you have to be able to draw the line between what is -- what is an appropriate and

wide-ranging discussion, and what is calls for things that are clearly morally objectionable. joe makes a great point. if you think there's a different point to climate change, you're not allowed. absurd, totally absurd. >> it's a go hamas. >> right. okay, so -- >> this is very wrong. >> it's complicated, but those two things are pretty easy. >> well, look -- if you're saying go hamas, be expelled or suspended from the school. >> that has not been the policy for a decade. but the policy for a decade has been to cancel people who have a different view on clearly political issues. >> now we're back to the flipside of this, which is which is the version of free expression that you're open to? right? so there are people -- included by the way, and go back to mark

rowan, very frustrated by certain types of speech that they thought should be allowed on the campus and it's only because of that -- part of the hypocritical nature of it has led to this too. >> and support for that kind of speech. okay, there's a difference when universities come out and support what is clearly calls for amoral behavior. that's not a hard one. i think -- look, this debate should be happening at the boards of trustees, and they should be setting forth strategies for dealing with this going forward. the simple strategy, let's hear from both sides is not the right strategy. it's more detailed. you need leadership. >> jake leighton, always good to see you, sir, bringing us an important topic, important discussion. >> write off all the universities, seen so much the last few years, this is just -- and then this, it's really rich. this is allowed. but none of the -- you know -- i

don't know where they find these people. >> this is the hypocrisy piece. >> i watch hypocrisy all day long. >> you have to decide where's the line? and somebody has to actually come out -- >> they draw the line arbitrarily at normal things. >> that's life because they do it one by one on the -- they do it one by one on ad hoc basis, what's convenient in the moment instead of having a strategy to deal with it. >> liberals love the pro-elon musk twitter, everything they wanted was allowed, nothing they didn't want was allowed and they hated it. now everything es a there, and they hate that. it's hypocrisy, i can cut it with a knife. >> you have to have a line. and i think you're saying you don't want a line. >> i don't want people from -- i don't want all of mark zuckerberg's employees deciding what with line is from silicon valley. >> he's fine to create the line and so are the university presidents, and the university presidents need to create a

line. and i don't think they moved the line. >> it really is complicated. >> they need to use their governance and process structure to do it. it can't be just one person picking line. >> i think it's cy as i they've all created these di programs and instead of using the di programs to deal with anti-semitism they're creating completely new departments, what does that say about what those di programs are doing to begin with, bigger question. >> should have been asking when you loved all those programs. >> can't be one person, can't be ten people. >> checks and balances. >> they preach this stuff. >> yeah. >> thanks. >> every person at this table would have a different line. >> okay. we've got to run. we'll see you in a little bit. thank you again. coming up, a lot more on the u.s. economicoutlook following last week's cooler than expected jobs report. lael brainard is going to join us.

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good morning, the october jobs slowdown will likely give the fed cover to hold rates steady at the next meeting. talk to former kansas city fed prosecute esther george.

president biden disappointing poll results. lael brainard joins us live from the white house. epic games takes on google in court, it's happening today, everything you need to know about that case is straight ahead, 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 kernen, along with becky quick. and andrew russell. a 5% gain in the dow, one of the best weeks for the three averages we've seen in quite a while we are adding to those gains, just marginally this morning, you can see the dow is about 32 points, nasdaq up, s&p's up, treasuries were -- the

ten-year was below 4.6 for a while, in the two-year, 4.88, oil kind of in the middle of its range over wti is about 80, brent i think 85 or so. >> trading day ahead with mike santoli. >> sorting out what was accomplished with last week's furious surge in the s&p 500, 6%, the big collapse in yields and what's left to be proven. this is a multi-year look, end of 2019, and one thing pointed out was that this line, that kind of traces all the way from the low in march of 2020, and then kind of connects with last year's october low, we didn't break below it. essentially this multi-year uptrend seems to be intact for now. the other thing to watch is what was going on here when we pull back is the s&p was checking back to the first half of this year, those levels when we

started to get confidence at a soft economic landing was possible, obviously trying to absorb that move in rates but where did it take us up? to where we were in late september in the s&p, that was where the prior fed meeting happened, september 20th. and treasury yields, ten-year back to that level. you've made some progress but still have work to do to get beyond those levels of september. take a look at the russell 2000, a real struggle here, and actually much more interesting on a five-year chart, where it sort of bounced off, and trying to make the case that that area is a floor, it's clearly not the leadership of this market, but, you know, when you do have israeli oversold rally we had rare signals last week that usually mean a decent low is in, that benefitted the russell 2000. high yield corporate debt. treasury, most of this move here was about treasury yields going down and therefore, high-yield bond prices going up, but also

the spreads have been pretty closely nice and tight, also back to september levels. so we've kind of undone about two of the three months of losses, and we'll see where it goes from here, becky, as we get confirmation or a challenge to that soft landing economic scenario. >> we've had a couple of guests who said that the volatility we've seen in treasury yields isn't over if that's the case, maybe see a lot more wobbling on all these other stock indexes too. >> it's pretty tough to make a declaration that we're now going to be in for bond markets, bond yields going down, the mag any tuds of the moves are outsized. people would point out that all we've really done is, again, go back a couple of months, 435, just under 4.5, it seems like an area where you might find some support. yeah, i agree that you can't really sort of relax when it comes to what the bond market's up to yet. >> past performance, no proof of future returns, mike, thank you.

>> 435 is not six. >> that's true. >> more on the markets, let's bring in jeremy siegel, professor emeritus of finance at the university of pennsylvania's wharton school of business, time goes fast. you were just on, but you were not on, you were on before we had wednesday, thursday and friday of last week. so, all the things that happened, jeremy, i would say you were probably nodding and saying, see, powell has done enough, the market itself has tightened conditions to the point where no more fed action is likely necessary, and that seemed to dawn on the bond market, and even on the stock market. >> yeah, absolutely, joe, and by the way, i think jay powell has to be on high alert because we did get some weak data, certainly on the ism, jobless claims and certainly on friday.

listen, let's be frank, the fed cannot screw up the way it did on inflation by waiting a year too late. i'm not saying we're going to have a recession or anything like that. but he's got to be very alert to slow down, and if the data continues weak he really does have to consider lowering rates next year. even though inflation is going to be sticky, and by the way, you know, for a long time -- i reject the narrative that the fed had had, oh, we can't be like the 1970s, the stop-go policy, we've got to kill inflation. this is totally unlike the 1970s. in the 1970s arthur burns and the fed poured on money every single month of the year. 8 to 10%. in the first half of this year we had a shrinkage of money that was the greatest in 80 years and then it began recovering, i felt better the last two months money

has fallen again, liquidity has fallen again, bank deposits have fallen below the level we had after the svb crisis, again, i'm just saying it's not the 1970s, and i just don't want him to delay the way he did on inflation, he's got to be flexible. i think that's what the market liked about, you know, his attitude into wednesday. he seemed more two-sided but he really has to be truly two-sided because we do have two-sided risk right now, and the downside is looming much bigger than it certainly did a week ago. >> so, you weren't just kind of nodding a little last week, you were like, this is all the things that you've been saying were coming home to roost in terms of whether the economy had already slowed down, whether the fed should take a light touch. so, in your view, we're still talking about data dependency on

another hike, you're still here -- you're -- that is not what you think at all. >> i think it should be done. >> you think maybe the next move is a cut? >> i think the next move is a cut, and it might come even sooner than we think, given the data, i mean, you know, i'm not predicting recession, got to look at that data, but it's begun to turn, we've got to be on alert, you know, some people are talking about, we've had a half a percentage point rise in unemployment, some people have said that has signalled many recessions in the future, i'm not there yet, but i just don't want a stubbornness on the part of the fed the way they were on the inflation side, on the downside. they have to be on the alert, and something else, this -- you know, joe, you led off at 6:00 a.m., because i was listening to you, you know, with the "new york times" poll. can you imagine what it would be for the democrats if there's a recession next year?

i mean, it's precarious as their situation is right now, i mean, wow, i mean, it would be disaster. >> well, yeah, yeah. >> and, you know, a lot of people are saying, oh, like that's not going to have a lot of consequences, the worst political consequences we've had for decades, or the power, you know, the -- >> for the incumbents. >> what does that mean? tremendous political pressure by the dems and biden to say, hey, beat, got to lock at this, the fed has to do a mandate. >> yeah. >> and he has to look at that. >> yeah, that -- i wonder -- that will play into it probably, and you know the closer we get, now it's less than a year. that is going to be front and center for how the party that's in power decides to avoid that slowdown. what about what was worrying

people last week, jeremy, and that is the supply? the supply's not going to go away even if the economy does slow, and the 33 trillion to finance at these higher rates, that -- so couldn't that cause, if people aren't going to -- i need to get paid to buy a ten-year, yields can't come down that far for me to go out ten years. >> yeah, but, you know, again, yield going down will help that debt overhang. >> yeah. >> and by the way, we, you know, i think you had -- something i've mentioned, we do have a really strong productivity recovery, and the promise of real growth being better in the next five or ten years with a.i., and other factors mitigates some of the immediate debt problem. i don't think, you know, the debt probably is going to be the big picture over the next 12

months. i'm going to -- i say it's going to be whether this slowdown accelerates, and how fast the fed will respond to it if it, in fact, it does decelerate. >> we're going to go, and we will -- good to have you on, and update what -- just about a week ago when you were on, but that's good, a lot has happened, thanks, jeremy, see 'ya. >> thank you very much, joe. following friday's employment poll, what the data is telling us about the markets and the state of the economy. national economic council director lael brainard is our special guest right after this.

welcome back to squawk, the rising tide of anti-semitism on college campuses, bill -- calling for her to take steps to reduce anti-semitism on campus. bill was listening in on the conversation we were having with jake leighton earlier, and

called into the squawk newsline, bill, it's great to have you on the program, i'm curious what your thoughts were as you were listening to that conversation. >> so i thought jay was spot on, in many ways, with one exception, and you with one exception, which is i don't think this is that complicated. i think the issues are incredibly complicated. the underlying issues, the israel-palestinian situation, the issue about free speech on campus is not, and here's my sort of perspective on it. one, i'm a huge free speech advocate, okay, and i think universities are important places for speech to be taking place. at the same time, there are laws about free speech, there's certain kinds of free speech that certain speech is not protected speech, so, for example, if you incite people to harm others by your words, okay, you know, that's fighting words, if you look up the definition, the law under the first amendment, but beyond

limitations under the law universities, you know, the harvard campus is a private space. it has it own rules, its own code of conduct, and harvard takes action against students that create an unsafe environment for other students, you're seeing this all the time, there are many examples of this, and it's usually when someone says a slur, for example, against lgbtq person, or a person of a different skin color, for example, and that kind of speech, which is actually permitted speech under the first amendment, okay, it's hateful speech, but it's permitted, universities -- most universities, i think the vast majority, don't tolerate their students speaking like that on campus, they suspend them, there are administrative procedures depending upon the degree of -- you know, if students are -- show hostility to one another, physically or otherwise, so, for example, there was a protest in harvard. >> that video, it's on video,

and you made the point it should be suspended immediately, and what's taking so long? >> yeah, and the answer is, oh, well there's a police investigation, and therefore we're not going to do anything until, you know, the investigation is completed. it's absurd. harvard's never behaved that way. harvard suspends students for drinking too much, harvard suspends students for -- you know, one kid, this is, you know, a friend of, you know, friend of the industry, okay, a son of a very good friend of his on a lacrosse team, drank too much, found himself asleep in another student's car and because they were of different ethnicities the assumption was that it was a -- you know, it was somehow a racist act. he was suspended for two months before the investigation was completed. but harvard took immediate action. the issue here is, one, free

speech is critically important, and harvard unfortunately has not been a bastion of free speech. there was a survey by an independent organization that looks into these issues on campus and harvard was ranked last, they've gotten worse in the last four years, this year they came in last. and now the school is using, and the president was talking about how, you know, free speech is so important, which is why we've done nothing on students shouting free palestine from the river to the sea, which is a -- is known, okay, if people were talking about lynching members of the black community that would not be permitted speech on campus, we're saying, you know, let's throw out lgbtq people, let's, you know, throw them off the -- into the sea, we just -- that would not be permitted speech on harvard, and i can't imagine it would be permitted speech elsewhere, the fact that

it's allowed to continue, okay, and the university does nothing, that's when, you know, what started out as legitimate criticism of israel, and there's nothing wrong with being critical of israel, and you should be able to say whatever you want, what is critical of israel, it's another thing when you're talking about the eliminationist talk, right, destroying a people, an ethnic group, that's genocide. >> bill, you spent some time there, you said you'd spent about seven hours on the campus meeting with students, just very sort of -- the palpable sense of fear that you sensed from those students and then by the way did you sense a palpable sense of fear on the other side of this? i mean, i -- look, i don't always say that there's another side to this, but there are obviously, you know, folks who have various views on this, on this issue. >> what i would say is, you know, you can't have an effective learning environment when students are literally afraid, afraid to express

themselves, and who they are, and even in some cases to go to class, right, a student -- i did a town hall with a bunch of students and the students said i have a tough time to go to class when on the student message board someone's writing anti-semitic statements or putting up anti-semitic cartoons and i see him and he sits in front of me in my class. it doesn't help my ability to learn. and i think the reason why universities have the ability to say in their own environments, you know what, we're going to -- we're going to actually have some limits on free speech, we're not going to allow people to say hateful things about jewish people, about black people, about lgbtq people because it creates a hostile environment that's not conducive to learning, the university could come to that conclusion, a university could also say we're going to follow strictly the laws around free speech, allow everything up to the edge on free speech. but even there, again, what's

not permissible speech, what's called fighting words, okay, or where you make statements and you incite people to cause harm to others and it creates a risk of imminent harm. what's happened, certainly on the harvard campus and elsewhere is, in fact, a risk of imminent harm. >> well, what's even more frustrating to me is that the hate speech is being defended, the things that you're talking about are being allowed, right now. but for years now the wrong ideas, the wrong ideas, and usually they're conservative ideas, and jake leighton brought up, you know, expressing skepticism about, you know, anthropogenic -- condoleezza rice, is she considered a war criminal? >> it was not frustration --

>> fine, many have been -- there are plenty of situations, the last five years, that you've probably watched where certain ideas were not welcome on liberal campuses. >> joe, you're entirely right. >> did you ever say anything about that, though? it's maddening, and now this is allowed, that's why the juxtaposition is just unbelievable. >> joe, by the way, you're 100% right, and this is a great opportunity -- okay, by the way, i shared your frustrations. did i do anything about it in a very public way? i didn't, okay, and my bad, okay, but yes, you know, the whole purpose behind the university system where professors get tenure was actually to protect them so they could put forth controversial ideas. okay, science, okay, is about the continual pursuit of the truth, okay, and what we believe to be true about science changes, and it changes over time very dramatically over

centuries, you know, and if you create an environment in a university where you can't challenge things like, you know, the climate thesis, okay, that is a very, very dangerous thing, same thing is true about, you know, controversial topics like vaccines, same thing is true, you know, the -- universities are supposed to be safe places to have those kind of conversations and you're entirely right, what's happened is tenure has been used as a way for someone to have permanent protection from their job, and speech has been, you know, true free speech has been curtailed on many campuses, and you're correct that conservative voices have been shouted down or not permitted to share their remarks, and that's why the incredible hypocrisy of what's going on now is incredibly evident and what i'm hoping is, hopefully you saw that in the letter i wrote, is i tried to

make the point, okay, that this is about free speech, free speech is critically important, it's critically important on campus, okay, but an environment where students feel physically threatened, okay, and where racist speech, okay, is allowed to be amplified, and perception is that university it shall or the clear reality is that it's permissible, it's defended by the president of the university in the context of free expression, when the same university president has been responsible for shutting down speech on campus of members of faculty and students. it's shameful, and it's incredibly, incredibly wrong. >> bill, can i ask you, i agree with you on a lot of what you've said, the anti-semitism that we've seen that is rampant anti-semitism, 100%, i think should be barred by these universities. when you start getting into whether or not it's complicated, i think it is, there's an entire side of the argument who would

say that if you say free from the river to the sea means they want to live in a democratic society where they're created equally. they will say free palestine means to give them a dual-state solution. that seems more complicated than the blatant, obvious, hateful inciting people to riots. and that's where i -- it looks like it's not quite -- >> agree to it is agree with you. okay, free palestine, i have no objection to it. okay, you could say free anything, it's fine. okay, but the language from the river to the sea, these are hamas's words. these are the words of terrorists. okay. >> it's actually the bible before that, the hamas people did picked it up there. >> adopted by hamas. >> right, it's part of the hamas charter. okay, so if you had students chanting part of the isis charter, okay, to -- again, i've read the equivalent of the isis

charter and everyone knows precisely what it means. there are code words to speak about other ethnic groups that are not permitted on campus, right, there are epithets, there are nicknames, for example, given to other ethnic groups that are entirely not permissible. >> netanyahu's -- >> but the complication, totally agree with you, number one, i'm pro-palestine, i'm anti-terrorist, but the complication about the history, okay, about, you know, entitlement to the lands, okay, and there are powerful arguments on both sides and we should be having these conversations on campus, we should be bringing the faculty, the students on all different sides of the issue to have a conversation that looks for solutions, that's what education is. >> okay, but here's my question. bill, because we've got to run, and i just have one other question because it relates to this hypocrisy issue, maybe i asked joe and becky the same question, do you feel more

empathy or less empathy for the marginalized groups over the last five years where the freedom of speech has been either -- i don't know if it's protected or the universities have stepped in. that's actually, i think, an important question right now? because what's happening here -- no, there's a question about -- t there's a lot of people looking at this and saying it's so hypocritical because these other marginalized groups, universities have stepped in to protect them and now they're not protecting them here. bill said, the same people now saying this today were in some ways against what was happening before. before it was the too woke, before it was being too woke, snowflake. >> it was never that. >> i think that's part of what it was, and i'm curious, bill, how you think about that. >> but the woke people have their preferred marginalized people. they dictate who's marginalized

and who's not, and whose ideas you have to have and the whole woke thesis never -- go ahead, bill. >> joe is -- the thing -- again i'd never done, i'd never read harvard's dei statement. i always thought of dei was for all marginalized groups. my ignorance. okay. but the dei program at harvard is limited to specific groups and excludes others. if you're an asian student that's a victim of prejudice at harvard you don't contact harvard's dei office, they don't work for you. okay, and that is really, really wrong, and by the way the most marginalized group at harvard in the last five years, to joe's point, is probably someone with a right-leaning opinion on the issue. that was a marginalized group. >> that's okay, though, bill, those people don't -- those bigots don't deserve to be protected. >> but my point is that dei, okay, it should be at a

university -- the world should be -- protect people who have minority voices, if you will, who are a smaller group, okay, and they're at risk of, if you will, a tyranny of the majority, and that's what dei should be about, it should be protected in marginalized groups, people who are discriminated against, people who are threatened by the actions of a larger majority, that's what dei, in my mind, should be about, because that's -- those people are at risk of being taken advantage of, of being harmed, of being emotionally harmed and that's what we should, as americans, okay, as citizens, we should protect those minorities. but those minorities shouldn't be a selected, you know, favored group, right, they should be -- >> bill, you're not going to get disagreement on that issue. we need to thank you for dialing in, we very, very much appreciate having you on the program, especially given the letter you wrote over the weekend and your thoughts given

your time spent at pharvard, we look forward to talking to you again soon. we are going to switch gears because we have to get to the white house. following friday's labor report, president biden said the economy is growing but recent polls showing the americans not on board with the president's economic plan. joining us is lael brainard, who served as vice chair of the federal reserve. thank you for your patient as that conversation went on, and we appreciate having you on the program. speak to this, though, i think there's a lot of folks who have been waking up to headlines, poll results over the weekend as it relates to bidenomics versus trumponomics. you people are thinking about the economy and how unhappy they remain about the economy. >> look, if i look around the world i don't think there's a leader out there who wouldn't

rather have the economic record that president biden has today. we have been growing, 3% over the past year, we've had unemployment down below 4% for 21 months in a row, real incomes are growing. wealth, this is remarkable, wealth is up 37% for the median household since before the pandemic. and we're growing faster, and have lower inflation than any other advanced economy in the world. so the statistics, i think, are very strong. now people have been through a very challenging few years between the pandemic and then the oil price spikes associated with russia's war. it's going to take a while for them to feel really confident, but if you look at surveys, 70% of americans feel like their personal finances are better now than they were before, we still got to work on kitchen table economics, there's still a lot

of americans sitting around their kitchen tables with costs of medicine, pharmaceuticals that are still too high and we're working on that. >> so, lael, what do you do about that? sometimes people say it's a messaging issue, and look at the numbers, and i even made the point in the last hour that on a relative basis those numbers look quite good. but on a day-to-day basis clearly those who are participating in these polls, and i don't know if you believe the poll results, clearly feel something very different. >> you know, again, i think we have 3% growth over the last three years, and over the last year, and inflation is down by 60%, a year ago, a consensus of forecasters said that to get inflation where it is today, down to where it is today, you'd need to see 4.5% unemployment and no growth over the last year. so, i think the economy is performing exceptionally well.

you know, my sense is that americans really like the president's policies when you survey policies like bringing insulin prices down to $35, down from $400 a month, they like bringing prescription drug prices down, protecting social security, they like a fairer tax system. it may take a while for americans to feel really secure but both the policies and the economic record are very strong. >> how concerned are you that come 2024 we are walking our way into a recession? >> so, we are seeing data that is causing most forecasters to take recession calls off the table. if you look at the jobs numbers from friday, we're now seeing job creation about 200,000 per month, a very sustainable level, and if you look at what's going on with the job market, what is so interesting is that labor supply has been increasing at

twice the pace of the year before the pandemic, so what's really going on is we're seeing a more balanced labor market, so many more people are coming back into the labor force at a time when job satisfaction is very high. those are reasons that plus productivity growth being strong, those are reasons to be optimistic. >> your sense, and i know there is hopefully a divide between yourselves and the federal reserve, but given that you've worked there as well, your sense of how they may be thinking about interest rates come both december, or do you think that raising hiking raises is off the table now for the long term. >> so, you know, as an administration we are very respectful of the fed's independence, what i will say is when i look at the jobs numbers that pace of job creation, the increase in the labor supply

cooling in wage growth, all of those things suggest that the economy is coming to a point of sustainable growth. >> talking about sustainable growth and the economics of the country, one of the other big issues that's been put back on the table, and frankly it never went away is our debt and deficits but in the headlines and the spotlight on it, especially as we now think about the war that continues in ukraine, the war in israel now, concerns over what's happening in taiwan with china, how do you layer in that sort of thought process as it relates to the economy, and as it relates to our long-term debt and deficit in the context of this election? >> well, president biden is very much committed to fiscal sustainability, that's why just back in june he signed a fiscal

responsibility act that brings spending down by 1 trillion over ten years, that's on top of the 1trillion in deficit reduction he's achieved already, and he has a plan to reduce the deficit by an additional 2.5 trillion. if you look at the recent deficit numbers, 60% of that increase is accounted for by a big reduction in tax revenues associated with the trump tax reform, and so going forward i think americans, we see this in all the surveys, they want to see a fairer tax system, we've put some good proposals on the table, we hope that that will be an item where we make some progress, finally. >> lael brainard, the white house, we appreciate your time this morning, look forward to talking to you again very, very soon. >> thank you. coming up, more on the markets and a check on big tech following the completion of mega cap earnings. and as we head to a break we're

watching shares of citigroup, sources tell cnbc that managers working on ceo jane fraser's re-org of the company. the talks about what's being called project bora-bora inside the company are said to be in the early stage and could shift. stay tuned.

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in a crisis caused by a terrorist massacre. warning civilians to clear out, while hamas forces them back. allowing in food and water, which hamas steals.

welcome back to the "squawk box," right here on cnbc, futures are up this morning, not by a lot, but you are holding on to some major gains from last week, which was the best week for the markets all year. right now dow features up about 28, s&p futures up by 7.5, the nasdaq up by 30. treasuries, all the gains in the markets last week, yields came down substantially. this morning the ten-year is back above 4.6%, just barely. two-year is up 4.88. magnificent seven tech stocks have been range bound since the summer but they're still up more than 85% year to date, we'll talk strategy for the last two trading months of e arth'somg xtthye, at cinne. e, tailor-made for trader minds. go deeper with thinkorswim: our award-wining trading platforms. unlock support from the schwab trade desk,

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welcome back, everybody, epic games is launching a new legal battle this morning in a fight against big tech. taking on google's app store. steve kovach is here with more on this. big fight. >> it's going to keep going and going. epic games like you say is the maker of the popular video game fortnite. today they're facing google in court and its lawsuit against the search giant's app store policies. this case is nearly identical to the one epic already lost against apple in 2021. epic's appealing that one all the way to the supreme court and we'll find out early next year

if that happens. for now epic is trying again with google, arguing that 15 to 30% cut google takes for digital transactions in the playstore for apps is anti competitive. these app stores are massively profitable for both apple and google. more so for apple, though, especially when it comes to gaming where users spend the most money. both companies are going to do everything they can to protect that fee structure and if google loses this case or if the supreme court picks up against the apple and rules against epic's favor it could destroy the -- software system on mobile devices last 15 years. new laws in the european union are kicking in next year, both google and apple will have to make it easier for third parties to sell their apps on iphone and android. that's going to eat into those app store profits, but for now they're going to try and stem the bleeding and keep control of their app store policies, at least here in the u.s., guys.

>> what do we take out of this? what's the bigger point? >> it seems like -- so it's interesting epic is going forward with this, despite this huge loss they had. one count that they actually won, and that apple is still fighting, but at the same time google has an interesting argument here saying they have less -- even less of a case against this thandy that i had against apple. there are caveats and exceptions, go to the regular internet and download an app to your android phone. there's even less of a case there, that's google's argument. this is a jury trial, the last one was just in front of a judge, that could be more in epic's gaifr. >> still a multi-gazillion dollar game. >> oh, yeah. >> let's say i want to hide from the world a little bit, and not watch news throughout the day. whatgame should i be -- >> oh, man. >> i just feel like i'm wasting my time if i'm sitting there playing. >> just zone out and -- >> there's day that i want to avoid knowing what's happening.

>> yeah. the new spider man game is really good. the new spider man game is really good. >> what is it? >> the new spider man game. >> what do i need? >> you need a playstation 5. >> playstation 5. >> i think you'd like it. what about xfinity. >> you want the mobile game. joe, most people -- half the world's population, close to it, plays games, most of them are doing it on their phone, wordle, and candy crush, you're already a gamer. >> i already am but i've run out of things and then i'm back to watching horrific things happening in the world. >> delete "x" from your phone. >> i can't run from those. >> delete "x" from your phone, all you've got to do. >> do what? >> delete "x" from your phone, i've done it, it helps. >> i don't have a blue check mark anymore? >> you didn't pay for it? >> i didn't. that could be anyone, plausible -- >> joe squawk could be anyone. >> could be anyone. >> pretty sure it's you.

>> how quickly people say their account was hacked. >> or the intern did it. >> it never was was. >> i think ted cruz pulled that one. >> steve kovach, thanks. among others. tech giant's alphabet, microsoft and apple reported quarterly results next week as we close out 2023. please, not yet. it's going to be 2024 and it's still writing 2022 on the checks, next guest is zeroing in on asset inequality, oh no, within the tech sector, joining us is jeff lewis, founder of bedrock capital, tell us what you mean, jeff. >> i mean, asset inequality, joe, it's pretty simple. we talk aboutwet inequality, we don't talk about asset inequality at all. the reality is in the public markets not all tech companies are created equal. i would argue apple is less magnificent than microsoft and we're going to be seeing these wild inequalities between assets getting priced into the public markets next year or so. >> you've got to love microsoft,

though, in terms of, it's been counted out so many times, goeff. of all the legacy tech companies that's got to be number one, wouldn't you think? >> absolutely. i mean, hovering around 3 trillion market cap, same apple, but the amount of investment they've made in innovation, the financial profile, the incredible bat on a.i. with open a.i., which i think is still wildly undervalued, wildly misunderstood by the market, the microsoft story is really incredible, yes. >> and geoff, we were talking about elon musk's new grok, his version of open a.i., but maybe with a little bit more attitude and some freedom, maybe less -- i don't want to say less guardrails. h ewants guardrails but maybe a bit more irrev rant. how do you think that's going to play, and ultimately do you think that's something that's going to end up having to partner similarly with the away open a.i. did with microsoft, do you see a big enterprise company saying, okay, we're not going to

be able to build our own -- we'll partner with elon? >> i don't think elon is the type of guy who wants to partner with anybody. would never count elon out of any race but there is an open question. i think grok's big advantage is using all of the data from ax, and andrew, i think we both spend a fair amount of time on "x," i would argue the "x" state is not that high quality. the question is the "x" data all pretty crazy. so we'll see how grok does. i'm sure it will get traction with consumers but i don't think elon is going to want to partner with anybody, my bet. >> geoff, i really like we're at magnificent seven or eight, if we go to magnificent 10 or 11, can you tell me the other three? >> look, i mean, i think if anything, joe, we're going to be in the magnificent two, instead

of the magnificent eight or nine. >> going down, that's interesting. >> we're going down from here, i'm afraid. >> really? okay. so give me five that won't be part of it in the next -- five. >> minus seven. >> seven minus five is two. >> i'm skeptical of i have said. when's the last time that you bought a new iphone? i think the upgrade cycles there are slowing. there's a sense in which they just really haven't invested in innovation. dropped the ball on a.i., and in the words of our former president, "china." they have a lot of exposure to china. there's a lot of the risk that's not priced in. >> the words of our former president was just, "china"? >> it's the way he used to say it. i know exactly. the likes of which we've never seen before. there's a lot of those. so, you don't have undiscovered, amazing -- it's going to be the big guys that do a.i.? there's nothing in the weeds.

>> oh, we absolutely have undiscovered amazing -- we have undiscovered, amazing companies in the private markets where we at bedrock invest and i think businesses we're bullish on in defense technology like mock, like public safety companies like flock safety, enterprise saas mega platforms, all of these are private market names that will come out over the years to come. disclosure, i'm invested in all of these, but these next generation mega platforms are going to be few and far between, and they take a long time to mature. >> is there any -- after apple, who do you think has some serious issues in the seven that we always talk about? >> you know, i think that the google search monopoly is really at risk here. you've seen openai just really capture an increasing share of search. what you used to be "search,"

people are using these a.i. chat bots for. google has bets there with their own llms and consumer offerings, but i think, you know, search goes away, which it looks like it's going to, i would be quite short google. >> keep going. we've got to get down to two. i guess i can figure it out. who's your -- it's microsoft. what's your other one? then i'll just do the -- i can figure it out from there. >> apple, google. >> i mean, look, i think nvidia's one that i'm very bullish on. i think microsoft is one i'm bullish on. i think apple and google are quite vulnerable. >> he thinks apple is vulnerable. >> how vulnerable is it? is it vulnerable 50%? >> it's vulnerable on a long enough time scale when you think about what openai might do with an a.i. phone. it's been reported that they're

in talks about building an a.i. phone. i think on a long enough time scale, if the next generation computing platform is not the apple iphone, that's a really big problem for apple. >> you don't believe they can catch up? you don't think this is a money story? isn't one of the lessons of the openai experience that if you have the compute power and you can pay for the compute power, you can build a pretty great model? >> that is one of the lessons from the ownershpenai experienc there is a major first mover advantage that openai and a few others have here. apple is way behind the ball here. >> all right, jeff, we don't hear people like you very often. it's very interesting. thank you. i'm going to put that into my quiver. is it in my quiver? do you -- sorkin, irreverent?

you like that with a.i.? you think a morning show, business show should be irreverent? >> are you saying you're irreverent? >> i want you to embrace irreverentsy. >> are you irreverent? >> we all are. >> still up in the air. i got to think about it. coming up, we're going to get you ready for the trading day ahead. we're going to talk stte xthe"sawk box" returns after this. watch how easy it is

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in a crisis caused by a terrorist massacre. warning civilians to clear out, while hamas forces them back. allowing in food and water, which hamas steals.

let's take a final look at the markets. got some screen on the screen. joining us now is dana, the invest net co-cio. dana, we're all trying to figure out what to do about this crazy market. lael brainard was on the program. she says she doesn't think a recession is in the aufg. i'm not sure that's the prevailing view, but maybe it's yours. >> i think the fed has definitely circled around to this narrative that we're sticking the landing here, and you have to give them credit for just where we are so far. this year did not pan out how anybody thought it would and at this point, i think even those of us who are still telling

people to prep for volatility, i don't think you can lay that at the feet of the fed at this point. i think there will be other triggers, certainly monetary policy filtering in still, but at this stage of the game, i think there are other triggers going on, and it doesn't mean from my perspective that retail investors should think the worst is over, but i think the fed, you got to get where we are. >> we have had a lot of folks with your job title come on the program and say, look, the five year, given where the ten-year is, lock some of that in right now because it's either going to stay there or it's only going to go down, not up. are you in that camp? >> yeah. i have to say, and actually, what i would say to you is that that's exactly what we're seeing happening. so, you know, clients, i mean, it's a tough period of time for retail investors, i think, in terms of just, you know, their overall economics, not just the money in the market but who can afford to buy a house kind of thing. consumer sentiment. inflation is obviously coming

down, but the increase in the level of those prices is not dropping. so, you know, everybody's kind of experiencing that, and then, you know, there's this back-and-forth on whether you should prep for volatility, be invested in managed accounts, and i think what we're seeing, people are taking advantage of these higher cash rates. financial repression kind of easing off because of all this and having -- >> but explain this to me. the nasdaq, and we have it running on the bottom of the skre screen. nasdaq had a great week last week. you would think that's a risk-on situation, but at the same time, you're also arguing that people need to rock in these rates, unless you think those ideas are compatible. >> it's back-and-forth, back-and-forth. but i mean, it's -- we're having a bit of a rally, and i think, to a certain extent, there's obviously interest rates have come down from the spike that we saw before, and we're also still in this, like, bad news is good news period.

so, if economic indicators are coming in a little bit weaker, that means is fed is going to be dovish. maybe it's higher for longer or at least it's not higher, higher, right, that they have to expect. so, i think the market reacts to that as the market does. >> okay. dana. we -- dana, we got to say thank you. we got to jump. we got to pass it over to "squawk on the street," and i'm sure we'll talk to you again very, very soon. >> that does it. good-bye, everybody. see you tomorrow. >> thanks. ♪ good monday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer at post nine of the new york stock exchange. david faber has the morning off. bulls trying to build on the best week for stocks in a year. dow is at six-week highs. nasdaq going for seven straight gains. we'll wrap up this final busy batch of earnings this week. ten-year, 4.6%. our road map begins with stocks in rally mode. stocks coming off best week since november of last year. media is in focus. disney reports thi