right now. ♪ good morning and welcome to "squawk box" right here on cnbc. we're live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. good morning, everybody. u.s. equity futures this morning are flat. got nothing to see here at this point. dow up by three. the nasdaq up by one. the s&p down by 1. you're seeing gains for nasdaq. that's the longest winning streak going back to november 2021. you're talking a pretty long time. we've been watching treasury yields. it looks like the 10-year is yielding at 4.59%.

crude oil prices are falling to their lowest level since july. that comes after yesterday's weaker than expected export data from china sparking concerns about slowing global command. crude oil down another 50 cents this morning. meantime election results coming in overnight. d democratic kentucky governor an de-beshear wins re-election. tate reeves wins his re-election. bran i do presley won a late endorse management from donald trump. in virginia, a lot of folks are looking at that state. democrats won that control of the state legislature, keeping the majority o in the state senate and flipping the house. for those things that governor youngkin might enter the race, that might make it more difficult. ohio trying to pass abortion rights. a smattering of results.

on the youngkin -- youngkin is a takeaway for those in new york. i think it was a small group of people who were hoping he was going to enter the race. >> pretty good smattering. >> it doesn't sound like that's going to be happening. >> i see a trend. >> i had people raising questions whether he could run in 2028. because if you don't have the legislature and the senate, you're not going to be able to put forth your agenda. >> ohio is still red sort of. i guess it's a reddish purple. >> this was in counties even that donald trump won handily. >> you know, some republicans, nikki haley among others said, you guys had better get your act together or guys and gals, because the country -- i mean 20 -- in 2022, all had something to do. i mean what was the point? how much did that advantage democrats in 2020 and 2022? quite a bit. that issue. >> you're talking about the

abortion issue. >> yeah. >> do you want to say it out loud? >> i already did. you kind of -- you know. when i'm talking, your eyes kind of glaze over. yeah, that's what i'm talking about. that issue -- we talked -- youngkin's out. i think david axelrod is going to have to take a back seat. them boldens democrats to say biden is still going about to be reelected in this environmental regardless of whether democrats are absolutely in love with him or not. so i don't know if both of those things are great for democrats or anybody. if it's no youngkin, it's trump, if it's trump, we're back to biden. we're back to biden. because out of 340 million people, those are the two. >> we're on that path is what it definitely looks like at this point. new this morning, meta is introducing a new policy to help users of its platforms to

discern when ai or digital methods have been used in political or social issue ads. starting next year, they'll have to disclose when they use a photo image that was digitally altered. that includes a person saying or doing something they didn't do, depictions of people that don't exister or pictures of events that have been altered. failure to disclose such digital alterations will result in dismissal of the ad. this seems like an obvious step. a no-brainer to say you can't digitally alter and have people saying or doing things they didn't do. >> all the things you said you're not allowed to do are giving me aniyy idea of what th actually means. >> it's bad news. meta says they're going to say that this can't happen, but every one of them -- >> we saw with the high school

thing with the photoshopped naked people or something. that's like -- that's the tip of the ice beagle of what we're looking at. >> it changes the axiom of believe nothing you read and only what you see. it changes what you see too. "the wall street journal" reports goldman sachs has begun to unload its general motors credit card program. it notified its employees that a process to find a new issuer. it's market is for buyers who buy and own gm cars. bank employees were reportedly frustrated by the lack of a push from gm car dealers to promote the card to its customers. shares of akamai technologies are higher this morning. earnings and revenue beating wall street's expectations. the content delivery company has

been pushing computing. it was from newer parts of the business. akamai's ceo tom leighton will be joining us a little later this hour in a first on cnbc interview. meantime shares of robinhood are tumbling, reported revenue that missed estimates. it in revenue jumped, boosted by higher interest rates, but equities trading revenue fell by 13%. crypto sharing fell 55% to $23 million. monthly active users falling. going backward. despite today's drop, the stock is still up year to date. it also announced blacks to brokerage in the uk and crypto trading in the eu in coming weeks. that stock off at least day to

day. 7.5%. >> it's bad when 7.5% is 75 cents. >> it's come down a lot. we're watching shares of mediterranean restaurant share chain cava. it raises its full-year forecast. the revenue jumped nearly 50% from a year ago. that's thanks to higher traffic. they've put in additional stores. the stock marginally off. raising its market forecast for the full year and plans to open more restaurants than expected at the time of the ipo in june. >> i haven't been to the restaurant. i want to. >> to cava? >> i have not either. >> you have? was it good? >> it was in the train station down in d.c. a couple of weeks ago. >> and you --? >> -- liked it a lot. spicy chicken in a wrap with

some things thrown in there. >> it's like mediterranean food, like chipotle. >> yeah, yeah, that's exactly what it was. it wasn't sure what the hell it was. there was a lot of places. fatberger. i thought i'm already fat. chipotle. the line was the shortest at cava, and i said, i'm going in there. check this out. i liked it. it's good. that's an endorsement. that's important for the company, i think. they're getting my endorsement. look at taco bell's success. there's one in every strip mall. ebay shares are tumbling. earnings beat estimates of a dollar, but the forecast disapoimtsed the street. it saw softening in september and october particularly in the uk and ingermany. and e ve earnings of note this morning, rivian sharings higher after the company reported a lower loss an raised

its full year guidance. revenue fell short of estimates. rivian ceo will join us in the 8:00 hour in a first on cnbc interview, and that stock is up by 7% this morning. >> it's weird. the lede story in the journal is slashing prices of evs and piling up discounts and the very next story, river yab raised its production forecast for the year. i guess it matters. >> yeah. >> tesla is good. rivian -- i see a lot of those. >> i've seen them. >> i notice them immediately. here comes a happy vehicle. it makes me happy. >> the suv is a good-looking car though. it's pretty cool. >> even the trucks, they're not troublesome trucks, they're nice trucks. let's talk about bumble. dating app current quarter estimate coming below estimates. rival match forecasting a loss.

bumble estimating it will take a hit of $1 million because of the conflict. yesterday the founder said she was stepping down as ceo in january. she'll remain executive chair and be succeeded by the ceo of slack. >> it's so different from what you heard yesterday how the entire middle east is only 2% and it's not going to be a big deal. >> it's a bigger deal for them and they don't have business in israel. uber -- u >> uber. i thought you meant bumble. >> i was. but uber as well. we'll talk more about fixed income with our next guest. futures up 13 points. nothing happening this morning, but it's surprising we did have another update yesterday after

some weakness in the morning. as we head to break, check out the shares of microsoft that hit a record high in yesterday's session, and that must put it with a market cap that most companies would give anything for. 2.47 with a t, trillion. you're watching "squawk box" on cnbc. of thinkorswim, the award-winning trading platforms. bring your trades into focus on thinkorswim desktop with robust charting and analysis tools, including over 400 technical studies. tailor the platforms to your unique needs with nearly endless customization. and track market trends with up-to-the-minute news and insights. trade brilliantly with schwab.

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our next guest says low rates are gone, not coming back. joining us to talk more about the markets is the co-head of investments of portfolio. i like this. for a thousand years there's been a cost of money until the last ten. what could go wrong. >> yeah. what we've been talking about with clients, whether that be retail investors is theal cami of low rates is other. interest rates have been real and that's been a tremendous step change for the last 15 years. for years we could borough. and if we got in trouble, the government would come forward. it looks at capital and higher volatility and significantly lower returns as we look forward. >> across the board. the other thing that i thought

was interesting about your thesis is that so you got three baskets, the consumer, the corporation, and the government, and the consumer is sort of giving us a head faic. they're sort of okay, right? this is not great, but corporations have yet to reckon with a lot of this. individuals don't have to because they've got -- they've termed out. but the one that we really underestimate the is government that's going to have to deal with front and center. >> i think you're right. what we've seen is the government is late to the party. interest rates have increased, but as you talked about, companies are pulling back. capex plans are pulling back and that has real impacts on the labor market. the consumers have 30-year mortgages, locked in on long-term financing at low rates, but new borrowing is

slowing. folks are struggling to live the lifestyle that is left. governance, they're late to catch up. as we look forward -- >> it will double by when? next year or this year? >> no, it's really two or three years out, but it continues to be a headwind, right, on continued government spiending. >> it's going to have a "t." tax service. >> correct. it will have massive, massive implications. really what we'll see is as much as the federal reserve has tried to pull back, the federal government continues to make it challenging because it continues to prop up inflation. i would look forward to the 2024 election cycle as a change for how americans about think about debt. >> none of these portend a great future in financials in general, not even bonds.

>> they're where they're supposed to be. >> rates could be higher. >> personally i think we've seen the peak in rates. i think we're definitely toward if not the actual end of the fed hiking cycle. >> what if it's different this time, if the central banks aren't going to rescue you if there's a downturn? maybe they rescue an absolute banking crisis that brings down everything, but what if they look at a recession and say, okay, we've got to live with this, there's more inflation, and this is more important that we stave this off? >> i think that's exactly the point. we're coming out on an environment where central banks were doing what they weren't comfortable with. >> why are you sure of the peak in rates? >> you never can be fully sure, but it's been a dramatic increase already. things are slowing down to the point earlier will, things are continuing to trend. that's making the rate fall a

little slower. >> government spending is not going to slow especially as you head into an election year. >> not into the election year, but watch the election itself, right? i think that's the key. i think what the american population will send the message is this is unsustainable. >> neither party has been good at this. >> where do you go? recession next year still in the cards for you. >> i think it's based in the cards. i think it's almost inevitable. >> run-of-the-mill plain vanilla recession or something worse or better? >> base case, it's relatively mild, but the fed isn't going to come to our rescue, not until they see the fed lower. >> you don't think at this time there's nothing like -- we're not heading toward the titanic. there's nothing under the surface that's really scary. it's just going to be a grinding sort of a -- nothing's going to blow up, but it's not going to be -- there's not going to be

good returns on stocks. >> that's exactly right. you never know what lurks beneath the covers, but really as we look forward it's a classic business cycle and one we haven't seen in most investors history, right? it's not the dot-com bubble, and i certainly hope it's not a global pandemic. it's a shook to the rise in capital. >> not even a rise in capital. >> we saw that earlier this year. it ended up to be a head fake. >> that's like a cold compared to something much worse. all right, jeff. thank you. >> thank you. >> good to have you on from thornburg. $41 billion. just relax. fixed income. well, just relax. i want you to sleep better. how did you sleep last night? do you have a -- >> i did sleep well, and i do have a -- >> did you check that? >> it was okay. i could have done better. i got an 83. >> 83.

>> that's a b. >> 83. >> my global readiness is good. elevated heart rate. >> what was going on yesterday? >> it's like a horoscope. >> that's what i need to do. >> what did you do? >> i ate food too late. >> you can still get awe roy that, but i'm warning you, you're a young man, you can get away with that. because you're a young man. you cannot -- it's a major issue. i have to eat at 5:00. it's a major issue. >> thank you, father. >> now you understand why they have the early bird special. >> exactly. i thought it was about a discount or getting a table. >> no. >> no. it's about -- >> done before 6:00. >> right. when we come back, amazon reportedly invefrtsing millions to train the large model. we've got the details after the break. and a programming note for you. tomorrow you can join cnbc's

your money virtual event and hear from jim cramer and top financial experts on ways to mitigate your finances. scan the qr code or you can visit cnbcevents.com for more nch information. "squawk box" will be right back.

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circle is considering going public next year. that's 'cording to a bloomberg report that says the issuer is talking to potential buyers. it's unclear what it could seek in a public offering, but it was worth $9 million before changing gears.

amazon now investing millions to train an ambitious large language. the model code name olympus could be one of the largest models being trained. that would be double the parameters of the open ai, being led by the former head of alexa who now reports directly to ceo andy jassy. we'll see where they net out. clearly amazon and apple investing heavily and trying to catch up as it relates to generative ai products. >> coming up on the other side, former white house advise senor is going to join us. as we look ahead to yesterday's s&p 500 winners and losers. >> announcer: executive edge is sponsored by at&t business.

next-level moments need the next-level network. move to the cloud. - 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.

good morning, everybody, and welcome back to "squawk box." we're like at the market site in times square. dow in the green by 26 points. the s&p up by almost 2. nasdaq up for eight sessions in a row. we haven't seen gains like that for that long of a winning streak for two years. it was november of 2021. berkshire hathaway planning to sell corporate bonds denominated to japanese yen. that's according to a filing. japan's in the process of moving away from its negative interest rate regime, but borrowing costs in the country remainincredibly low compared to the rest of the globe. berkshire is one of the largest issuers. the last time they issued it this year was in april when buffett had gone to japan to visit the five trading companies that he's bought a major stake in, and at that point they

issued a lot of debt. people look at it, if you can lock in a long-term low rate, that's the place to do it for now. >> that it is. meantime we're going to pivot not. it's been a month since the deadly attack. forces are pushing deeper into gaza city intending to secure cure control once the war ends with hamas. at least that's what bibi netanyahu has been saying. joining us now, dan cesenor. he's the coauthor of a new book "the genius of israel." i want to talk about the book, but where do you think we are and what to you think about what

bibi netanyahu said? some describe it as an occupation and a life. >> first of all, i think october 7th -- i was on the show where you guys. the trauma is difficult to overstate for the country. this is the worst setback for this country at any time going back to the 19 p 3 yom 73 yom k war. i could go to worse than that. there are over 200 hostages in the tunnels. these parents -- there's a news anchor from channel 12 that sent out images of the 30-plus children. these parents as the war goes on. 30 days is a long time for a 9-month-old to be without their parents. the 9-month-old is 10 months old. that being said, we've seen two things happen. resilience. the country has come together in

ways no one could imagine when israel was dealing with depths of division. it gives people a lot of hope how is it extends are volunteering, filling government roles that have been absent. in the war when you talk about senior levels and the infrastructure, i want to be care. all war fighting is always fragile. it's always going well until it isn't. but the kmajders and civilian leaders are cautiously optimistic that they're making a lot of progress, that they're moving deep into the hamas territory in gaza. to your question, this was sprung on israel on october 7th. people were calling for a size fire. there was a cease-fire with hamas. it was on october 6th. it ended on october 7th. israel has to get rid of hamas out of gaza. what follows, us real doesn't know. in the interim, there's going to

have to be a period where israel keeps military in gaza to keep the calm. they left gaza in 2005. they do not want to be back there, but there's no easy hand-off, you know, the moment this war ends. >> when do you think it ends? how long do you think it goes on for, and what do you think about the bub lick reaction around the world because it really feels that, frarpgly, there's not a lot of support for what israel is doing right now. >> i think the operation in gaza will go on for months. i honestly can't give you a precise time. a lot will depend on when the commanders of hamas are killed. gallant, the defense minister, has said if the palestinians understand sooner, they can take out the commanders of hamas. that's the quickest way to end this war. i think israel is in an impossible situation where at any moment, a second front,

third front, north could open up. hezbollah gave a speech last week where he basically signaled his intention to not get involved. this could change. >> with iran and all their trouble-making, it's every day just about, what do we need to do in terms of -- it's a weird one. >> are they calculated troublemakers? >> the president says don't. that's all we hear. and our military response has been anemic at this point. >> i think iran and hamas thought two things. they thought by having these 230-plus hostages, it would create some reticence.

i think some have spooks tehran and hezbollah because they're considerable resources. the question is do we use those resources, but they're there. >> it could be a red line. >> to get to your point, joe, at the end of the day, you talk to israeli leaders, and they say, we can deal with hamas and hezbollah and increasing hesitation in the west bank. but they're being surrounded and architected by iran who literally calls for israel to be wiped off the map. i think is reeling realizes the world in which that i have some co-existence with iran and they've lenned to live with iran's containment is not going to work. >> so are you satisfied with the biden administration's response? >> so far, yes. i would hope they would be a little more aggressive toward iran, but at the end of the day,

the president made it clear. he went to israel, he met with the war cabinet and deployed a lot of military equipment. >> your thought is this absolutely spreads and turns into an entire middle east war? >> i don't say that with certainty. i say that israel -- the idea that they could definitely live within containment of iran as a long-term strategy is unsustainable, and most israeli leaders believe that. whether or not it turns into a regional war tomorrow, i doinltd think it will be. >> speak to the global blowback to the way israel is handling this because that's also going have an impact not only on israel, but on the way it's having on conversations we're having at universities around the country, on jewish people around the world. >> i will tell you as a jew and as the son of a holocaust

survivor and as someone who's raising two children who duo to a jewish day school, so this is separate from all my family that lives in israel. i'm talking about my life here. i grew up with all these stories about the holocaust and my mother was on the run as a little girl in eastern europe. i was always familiar with the stories but i never felt the vulnerability, the vulnerability that she feels. this is the first time in my life i've ever felt vulnerable. there's real anti-semitic violence against jews. they say, oh, you can be critical and not be anti-semitic, but why is it when israel is on the receiving ended of a genocidal attack and it must respond, the response from organizations here, whether they're on college campuses or protests in the streets is to go get jews, mob the jews.

i will tell you. it is -- it is -- it makes me feel very vulnerable. i know a lot of jews feel this way. to answer your question, andrew, nobody believes, i don't believe -- i believe here -- nobody on the israeli spectrum from left to right, nobody believes that if israel did anything differently the reaction would be different. it's not like, oh, if we got ten more fuel trucks in or did three hours of a pause that somehow the temperature would come down. the response is so overwhelming and so intense. >> what do you make of the comments you probably heard in multiple interviews like somebody like the queen? >> she didn't mention how this started. she doesn't acknowledge the beheadings and live rapes. i know someone whose niece was

raped live on october 7th on facebook. >> it's like a singulairty. >> right. >> you don't about have to go back to queen runyan. yesterday on the floor of the house, speeches from members of the squad, and it's almost like, okay, it happened on done -- let's begin -- you can't begin the conversation on october 8th. >> the greatest part of this argument which makes me crazy is yes but. the queen doesn't acknowledge what happened. the worst is the people who acknowledged it. >> by the way, i think she acknowledged it but she says, look, she believes the palestinian people have been oppressed by israel. >> and israel left gaza in 2005. my point is if you're frustrated with the plebian people, there's one place to look. hamas took over gaza.

>> i thought obama -- it's the moral equivalence. >> we're all complicit. >> first of all, you look at kennedys. >> he talked about the occupation. secondly, if you look at what obama did in taking out i.s.i.s., which i was for, i thought it was successful. in 2016 he flattened mosul. there were plenty of casualties, more than gaza. i have a difference t idea. >> how do you call for a cease-fire when they have hundreds of hostages. >> right. >> the book is called "genius of israel," and it's about the resilience of israel. i'm so curious what you think is going to ha p oppen on the othe

side of this. if we had a discussion a month ago, there was a question ore how splintered the political system appeared to be, and the question is it ultimately going to be splintered of the other side of this as well and in a different way. >> i try not at to find moments of lightness in the midst of darkness because it's been pretty dark, but i would say when we wrote the book, we were writing it during the depths of division. we argued is israel immune to polarization? no. there's political polarization in israel and they're look societal shock absorbers that the united states doesn't have. when you think the country is going to break apart, it can't. israel has a weekly shabbat which overwhelmingly israelis do together with family, friends, people they disagree with, all religious walks of life.

the u.s. has one a year, thanksgiving. almost all serve in the mill tissue during the formative period in their lives and they're serving with people from all walks of light. you can viciously disagree, but you're still in the hull of a tank or in training business with them or going on patrols with them. it's impossible to think of that person as the other no matter how you disagree with them if you have this life experience with them. because of the reserve duty, it extends into their 40s. they go back every couple of years. we go through all these factors that we in the u.s. can keep. et it doesn't mean the country doesn't have deep political disag disagreements. they're like a big argumentative men ta active noisy family and someone poked the family and they say enough of the

arguments, we've got to get together. a thenld you see the images how they rally together and people step stoegt. you have ultra-yoorthodox jews. do i think this is the new world for israel post this war? no. do i think it's a new baseline? yes. i think israel will come out of this war saying, you know what? we still have real tensions. the baseline will have changed. >> dan senor. the book is called "the genius of israel." we appreciate you being here this morning. we'd like to say coming up, we'll be right back. okay, coming up, nintendo is looking to build on the success of the super mario bros. movie. we are cnbc. they're announcing a live action film of another hit franchise. details ahead. later, don't miss our

interview with altimeter capital. we'll be right back.

overnight in tokyo after a better than expected earnings report. the company also announced it's teaming up with sew any to develop a live action film based on its hit video franchise, "the legend of zelda."

what's coming up, becky? >> akamai shares. you can see the stock up by 3.8%. the company's ceo tom leighton will join us next. a reminder you can watch or ecsten to us any time. chk out the cnbc app. we'll be right back. recommended. 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. my sister has told me so much about you. that's why it's more than advice worth listening to. it's advice worth talking about. ameriprise financial.

akamai shares moving higher after the cybersecurity and cloud computing company reported stronger than expected profits and revenue. the company also increased its full year guidance and as a result, the stock is up by just over 3.8%. joining us right now on a first on cnbc interview is akamai's

ceo and co-founder, tom leighton. tom, i will tell you, i have thought about your company for a long time as a cybersecurity company that was really doing a lot on that front, along with the content you're doing. cloud is a newer business for you and when i think cloud, i still think of the big guys like amazon or microsoft, some of those bigger companies that are out there. what are you doing with your cloud business and how do you compete against those titans? >> our approach to cloud it different. it is based on being massively distributed so we can support your compute instances, your containers, vmcoupe cuber netti in many areas around the world. that gets our performance and connecting with our presence in 750 cities, we can make it be a lot less expensive. that's of interest to our large media customers, large commerce customers, performance matters to them and cost matters to

them. also, akamai doesn't compete with them like some of the hyperscalers do. >> so what does that mean in terms of the future growth for the business? is that why you're raising your guidance? >> i think there is a tremendous potential for future growth. you know, you look at our compute business today, it is projected this year to do about half a billion, but that's an enormous market and we think we have a very compelling value proposition. you know, better performance, better scaleability in terms of being geographically distributed at a lower price point. i think it can be pretty compelling and you think about a market that is well over $100 billion a year, and growing at over 20%, that's a lot of opportunity for akamai. >> so, what is happening, though? do you see the security, the denial of service attacks that are happening, is that a bigger growth engine for you, is cloud a bigger growth engine, is this a time that companies are pulling back on spending on any

of these initiatives as we worry about funding costs? >> security is an excellent business for akamai. it is our largest product line today. so today is driving most of our growth. was up 20% year over year last quarter. and you're right, a lot of attacks, both traditional denial of service attacks, just the last few weeks we have seen a lot of very large attacks against major north american banks, who are our customers. also, ransomware has been in the headlines, we have the market leading product to stop ransomware to keep it from causing the damage. so it is really both businesses, very strong today. today security is larger, growing very well. compute is smaller today, but tremendous upside potential. >> we have heard from a few companies that have really kind of opened the door and said that because of attacks, because of security attacks, they had to say that, yeah, this is a meaningful issue, we heard the stories very loudly about companies that had to stop

production or shut down their supply chain at different times and it is important enough that they actually had to report it in s.e.c. filings. can you stop those types of situations? what does it mean for the customers that you have who have seen attacks like this? what do you do? >> yeah, you know, our segmentation solution, the market leader of stopping the damage from these attacks, it identifies when the malware has gotten in, where it is, so that, you know, you can get a it cleaned up before it causes damage. also, it proactively prevents the malware from spreading. and ransomware is not so bad if it just is in one server. the trouble with ransomware is that it spreads and locks down, you know, your entire operation. and then you're in big trouble. and, you know, that's what akamai's solutions prevent, that big damage, or data ex-filtration. if a noncritical asset has been penetrated with malware, not a problem. if that malware spreads and gets

all of your sensitive data and ex-filtrates it, you got a disaster on your hands and you're right, the reporting requirements have gone way up and the financial damage that it has caused is enormous. i think, yeah, you know, enterprises are looking to spend less, but that's not an area where, you know, they can crimp, you know, on the costs. they have got to defend themselves against massive damage. >> you got government agencies like the department of labor, the census department, the census bureau and department of defense. you also got big corporate clients like an ebay, adobe, electronic arts. which is a bigger business for you, the government agencies or private customers? >> well, the commercial sector is much bigger for us. we do have a good government business for -- actually several countries around the world. but it is the commercial sector, you know, the major banks, the major commerce companies, the big brands, you know, across the board, turn to akamai to defend

them against ddos attacks, application layer attacks, ransomware, malware attacks of all kinds. >> all right, tom, thank you for joining us today. tom leighton. >> thank you. coming up, a video game years in the making, grand theft auto 6 could have a release date. and shares of take 2 are soaring. that story is coming up. then, former house majority leader eric cantor breaks down the key econ deltiay results and what it could mean for your money and for the future, for all of us. "squawk box" is coming right back. right. work. you worked hard and it's time for a bank that'll work hard for you. everbank brings security and a guarantee. that you'll earn a yield in the top 5% of competitive accounts. going, got you where you want to be. we're the partners for your next move. everbank. advantage, you

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good morning. the s&p eking out gains and notching its longest winning streak since november of 2021. investors looking to add to the gains this morning. futures are little changed ahead of the open. elections being held across the country yesterday. democrats winning in kentucky and virginia, while mississippi's republican governors seeks re-election. we'll talk about next year's presidential race with former house majority leader eric cantor. a meta whistle-blower telling congress hasn't done enough to protect teens from

sexual harassment after his own daughter had problems online. we'll talk to the whistle-blower about what he told the companies and how meta executives reacted to his requests. the second hour of "squawk box" begins right now. good morning and welcome back to "squawk box" on cnbc. we're live in the nasdaq market site. looking out at a lot of construction outside. just noticed it. >> it has been there for a while. >> yeah. i'm joe kernen with becky quick and andrew ross sorkin. u.s. equity futures at this hour are marginally positive, but we should point out, this would be nine days in a row. >> for the nasdaq, yeah. >> if the nasdaq were to close higher across the board. we saw marginal gains yesterday. but we had that great move off

the october lows, all the way to the beginning of august. and we're in a pretty significant pullback that got to a correction in the nasdaq, not quite in the s&p, and none for the past seven days we have kind of bounced off of those levels. treasuries, they're cooperating, saw 4.50 something in the -- 4.57 this morning in the ten-year. >> election results coming in overnight. kentucky's democratic governor andy beshear won re-election after vastly outspending republican challenger daniel cameron who was backed by former president trump. mississippi's republican governor tate reeves won re-election, brushing aside a challenge from democrat brandon presley. reeves won a late endorsement from donald trump. in virginia, democrats won back control of the state legislature, keeping the majority in the state senate and flipping the house. also in ohio, voters passed a ballot initiative that enshrined abortion rights in the state

constitution. we'll speak to moelis vice chair and former congressman eric cantor of virginia about these results and much more. >> okay. talking about the markets now, investors increasingly turning to alternative investments to maximize returns from the private markets, giving the current high rate environment. want to bring in the co-chief investment officer of blue el capital, alternative asset firm and leading player in the space with $157 billion of assets under management. good to see you. >> good to be here. >> what do you make of this crazy market? and we were talking about israel and the middle east and everything that is happening, but more broadly, where do you think we actually really are? >> it is a volatile world. that is the baseline today. just thinking about comments, joe, you were making about the rise and fall of the markets and the rise again, interest rates 4.57%, about 1 1/2, 2 years go.

all that volatility is what makes alternatives work. alternatives are built to take a longer view. alternatives have for decades now delivered great results. >> except in a very high interest rate environment, tough to buy stuff and make it make sense. >> well, that's where the markets have to work, right? the end of the day, it is all about pricing, all about resetting pricing and getting buyers and sellers back together. that takes time. no doubt about that. >> in terms of where we are right now, and how much it is going to cost you to lever -- to lever the portfolio, what we're talking about, it is a much more expensive market. >> for sure. look, our business is lending money to private equity. really our whole business is to be a capital market solution, a capital provider to the private equity ecosystem at all. >> we have seen the private equity system at large, in terms of transaction volume, come down materially over the past year, year and a half. >> dramatically. >> what does that say? does that say they're the smart money and they know that

multiples are coming down? does that say they can't afford it? does that say that interest rate is too high? what does that speak to? >> well, whether -- it tells us there was a pretty euphoric and active period in 2021, maybe too active. so -- >> and what is going to happen -- you talk in the moment what is going to happen to those deals? >> in terms of today, no doubt activity levels have come down and have got to get -- part of it is getting buyers to sell expectations together. part of it is the opacity of the world we're in. the uncertainty today, married with interest rate uncertainty, market uncertainty, these are long-term decisions so private mac markets can look through a lot of short-term uncertainty, but this is, you know, perhaps more than uncertainty, this is opacity. it will take time for the volumes to return. the strength of the private market is that it can look past today, past tomorrow, out a

couple of years, and look for returns that are based on the fundamental opportunities within the markets. >> could it be a problem that today we're at 33 trillion, we look out a couple of years through the opacity, we'll be at 40 trillion. it is not going away. are you sure we return to some positive environment for financial assets or are we just -- we're in a pickle for a while. >> well, look, in due candor and tending our garden so to speak, blue owl, we provide capital solutions to the private equity industry. and our single largest business is providing senior-secured loan to rate debt. this is higher rates today. the tremendous benefit to our lps and blue owl as a firm, we're a fee-based business. we don't have carry. >> it is okay for blue owl. >> i do still have a business to

tend to. for the markets at large, it is a more challenging environment, there is no doubt about that. >> right. >> what do you make of the argument you would be considered part of the shadow banking system as a lender in the context of what you do, and that the banks, the jamie dimons of the world who said for a long time now that this world needs to be regulated a lot more to match what the banks have in terms of their regulation. >> so the term shadow bank, which i understand, has been invented by some antagonists of the business, let's take a step back and really understand what we do. we collect pools of long dated capital and make long-term loans and our balance sheet is unlevered and disconnected from other investors. so who do we have? we have sovereign wealth funds, we have pension funds, endowments, wealthy individuals, they commit their capital for the long-term. in fact, most of our capital, 93% of blue owl's capital is permanent capital, that stays

with us, it doesn't cycle, it doesn't go away. and so, as a result, we can actually make those long-term loans as a long-term principal. the way banks were to years ago, today, remember, you know this well, for 30 years banks have been getting out of the business of making these loans. banks don't lend money to the companies we lend money to. what we do, where we do compete if you will, is we're offering a long-term solution to be their long-term partner, the banks are saying we want to be an intermediary. we're not in the same -- >> what is your bet on rates as you look out over the next year, year and a half? >> well, my bet is to be in the floating rate business so i don't have to decide. it is going to be challenging. i will say this, in the scheme of things, and i don't pretend to know where rates are going, but i will say this, inflation is a sticky problem. inflation is challenging. i will say for the last year, when people say, we're about to turn over, rates are about to start coming down, that didn't

make sense to us, sitting where we sit. still doesn't make sense. >> it still doesn't make sense yet. >> we're still going to be fighting this fight. inflation is tough once it is embedded. once people are used to increasing prices and used to having wages rise, those are good things nominally. but when taken together, it continues to make inflation a persistent animal. high rates for longer are likely the case. >> you remind me a little bit of an airline that hedges fuel costs, they do -- they never make any money from it, but they don't lose money. there would be times where you shouldn't be floating. you should have fixed rates, right? you just won't do it because you want to be flexible either way. >> well, exactly. our role is to be able to sit here today and have this conversation. i'm sure none of us say, look, i know where rates are going to be or i have an extraordinarily high level of conviction. so my investors, our investors, are going to do well if rates are up, and, yes, their returns

will come down if rates come down but inflation has come down. we're delivering a durable return. >> you think it is volatile. >> yeah, i think uncertainty is the call of the day. how could it not be? look at the geopolitical uncertainty you were all just talking about. look at the interest rate conversation we're having. think about where the markets are, it is a little hard to connect market prices tws todayh that level of uncertainty. >> i'll still scarred from early '80s, there was 13% triple tax free munis. none of the clients would buy those. they all wanted floating rates. and they floated right down with them. and that could have been the trade. they never would have had to do anything else, ever. >> listen, with hindsight for sure, there are moments where we know there is assets we want to buy. >> don't want to be flyfloating. don't want to be in a floating rate mortgage. >> to be a floating rate provider and -- >> one thing you don't have to

worry about. >> marc, thank you for coming in this morning. >> thank you for having me. appreciate it. when we come back, tech investor bradley tusk on a.i. regulation and what it means for investors. and later, moelis vice chair and former house majority leader eric cantor will join us to break down some of the key election races throughout the country. "squawk box" will be right back. add more guitar, maybe some drums. -wow. so many choices. -yeah. like schwab. i can get full service wealth management, advice, invest on my own, and trade on thinkorswim. you know carl is the only front man you need. (phone rings) oh, i gotta take this, carl. it's schwab. schwab. (feedback rings) have a choice in how you invest with schwab.

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a new poll from axios and morning consult shows respondents ranked a.i. and tech regulation as among their last priorities when it comes to government policy, which could affect timeline of congressional legislation on both. joining us right now to talk about this and much more is bradley tusk, the ceo of tusk ventures. he's also a new author as of this week. his novel "obvious in hindsight" is out in independent bookstores right now. congratulations on the book. >> thanks so much. >> we will get to that. let's start with a.i. and where things stand. so 11 out 15, doesn't rank all that high on voters' minds with things, but it is higher in industry and government when you think through what the implications are. >> definitely in industry. we look at a.i. as this stand alone thing, but the reality is, it is just going forward for any new company, for all of my portfolio companies. it is a component of what they do. it is an underlying tool and if i have a portfolio company not using a.i., i want to know why

isn't this a more efficient way to do something. it is more embedded in all of our life as opposed to being this one specific thing. but it is also easy to understand why people don't necessarily sort of see it as big of a threat because it isn't real to them, rather than going on chatgpt and searching who is better, lebron or jordan or whatever it is, it is still very kind of intangible to them. and there are real -- >> wonky and -- >> yeah. on the poll, people are worried about jobs, their safety, worried about foreign wars, worried about their kids' c schools, those are real things that affect their lives. a.i. will have an impact on all of those things. right now it is conceptual more than anything else. >> you look at your companies and your vc portfolio and if they're not using it, you think they're behind the curve. do you have worries about a.i. too? >> sure. i think a.i. is one of these things that has incredible potential for good and incredible potential for harm,

right? you could think about a.i. from a digital health standpoint and diseases that by the time we catch them, it is too late to do anything about them, we could arguably see we have the gene for it or just whatever is in our blood, you know, 10, 15 years earlier and people could live much better, healthier, longer lives. there is real incredible potential for it. but at the same time, both disruption to the workforce and then also just misinformation it can be used for is a real risk, but i think also it is a little silly, we see all the politicians out there, talking about regulating a.i., they haven't regulated internet 2.0 yet. section 230 is still alive and well. there is no data privacy laws nationally in the u.s. we still don't really know what our antitrust policies are. and so, yes, we have to deal with this, it is a lot like politicians are just running for the newest talking point and the thing that will get them talked about by you guys and they haven't done the work from ten years ago. >> your satirical book, you come at this not only from vc, but

also time in government, where you are looking at both sides of this, talks about flying cars and the race to get flying cars out there and the evil ceo and her evil consultants, political consultants trying to make this happen. and maybe a little bit of a bumbling government. >> yeah. >> trying to deal with it on the other side. >> it is about a campaign to legalize flying cars in new york, l.a. and austin. and on one side, like you said, flight deck, the flying car startup and their vicious political consultants. on the other side is uber who doesn't want competition, the socialists, the unions and the russian mob. and the book is absurdist, but it shows how things get done. >> you understand this because you were one of the evil political consultants for uber. >> for sure. i still do that all the time. >> what is the downside? you're living in this world and you think these companies are manipulating? >> i think what everyone or all sides need to understand, and what i'm hoping to get across to the readers is politics in many

ways is pretty simple. every policy output is a result of a political input. every politician makes every decision solely based on re-election and nothing else. and if you could understand what is going to impact the next election and if they believe that you have the ability to impact it, they will work with you. if they think you have no impact, you're irrelevant and we might want our politicians or tech ceos or vcs to be better people. we're not going to change human nature. we understand what motivates their decisions and why, you can do something about it. >> i thought it was follow the money. maybe that plays into your theory. >> they want to get re-elected so you get some money. >> yeah. i think even -- >> why why do they want to get re-elected? to stay in power? >> there is literally, i would argue in the 30 years i've been working around politics, most have this hole in their psyche and the only way to fill it, they need constant validation, constant affirmation and the best way to get that, you don't have the ability to do what you guys do, start a company or whatever else, you run for

office and then you're somebody, right? you have a title. you have a car. you have a special license plate, and -- >> might get a really nice car and cash in your pocket. >> depending how aggressive you are, yeah. ultimately the notion of giving that up for them is so horrific that that's why they're never going to put any policy issue, on either side of the aisle, ahead of their re-election. >> tim langone said for a long time, i used to not pay attention, i think he may be right, term limits is the answer. that's how you get better people in. >> something i've been trying to push is mobile voting. i think one reason we have things so important and di dysfun dysfunctional, it is such a pain to go vote that not that many people do it. we have a new york city council elections last night, i don't know what turn outprimaries in 6.5%. a couple of people in the district are deciding who the city council members are.

if people can vote on their phones and that's how we legalized uber. turnout goes up. and what happens, it moves to the middle. who votes? the people on the farthest left, the people on the farthest right, we have the dysfunction of washington or one sided government whether it is crazy left wing policy out of san francisco or crazy right wing policies out of the state of texas and if we want moderations, we can get things done, you got to increase primary turnout and the only way do that is to let people vote on their phones. >> i voted yesterday. a couple of times. no. >> what is the pushback on that? >> the people on the face of it, cybersecurity experts, no, it is not safe, we can't do it. i've been -- the last three years out might have foundation, building our own mobile voting tech technology, i would argue the most secure voting technology ever built, but the people who really aren't going to want it

are the politicians, the people in power. ironically this will unite the two partiesbecause if you have power today, you don't want to lose power, and whether you're a republican, a democrat, a union, a lobbyist, a trade group, if you know how to win elections and low turnout primaries, you have no interest in really changing that. and so it is going to require overcoming the entire system, so it is about building a movement, which i'm not sure i know how to do yet, but once we finish with tech, that's the next stage. >> might as well not -- >> you're right. >> not going to happen. >> what do you think, just in terms of when you say the people who run, people who have a hole in their psyche what do you think of the race as it is playing out? we have been saying this morning that the results from election day yesterday, where ohio decided to put abortion rights as a constitutional amendment and where youngkin did not see -- saw democrats win in both the -- both houses of legislature there.

probably makes it more likely this is definitely going to be trump versus biden. >> yeah, for sure. you think about it, getting back to the hole in the psyche, people don't walk away from power, right? i think joe biden has been a pretty good president. based on the polling, people really don't want him to run for re-election. but he's got the most powerful job in the world, and he's not walking away from it, right? and donald trump had the most power ful job in the world and e wants it back. it may be majority of americans -- majority of americans would probably prefer other options, but it doesn't matter because the people who have power hold on to it desperately. look, last night was a good night for the democrats. it is kind of weird. you look at the polling and the times had the poll over the weekend that was disastrous for biden, you would think, wow, they're in big trouble, but then in every sort of election, last night, the midterms, referendums around abortion, democrats keep winning actual elections, so it is a little unclear whether there is maybe sort of a disconnect between what people are telling pollsters and what they're showing at the ballot.

>> romney up by 8 right now. >> yeah. >> didn't win. >> no. he didn't. >> he didn't come close. >> yeah. you think that's because just the polling is off or because ultimately the system -- >> i think it is sort of what you said, people say one thing and maybe do another. i don't think it was great for the country yesterday the way it turned out. it sort of ensconced the two candidates into they will be the two candidates. >> yeah. >> youngkin, if virginia had won, i would think maybe he might get in or it might -- it might give democrats, david axelrod notion that we need to do something, i think it gives them probably a false -- maybe not false. he's going to be re-elected. >> shut down any rebellion on the other side. >> right. yeah. that's it. leaves us with two guys with big holes in their psyches. >> no question about it. youngkin, everybody loves the

backup quarterback. every time someone is not yet a candidate but rumored to be it, oh, only if only glenn youngkin, gavin newsom would run, everything would be perfect. >> nobody is saying that. not the second one. not the latter. >> some people in california. >> exactly. in california. >> bradley, thank you. congrunatulations on the new bo. former meta senior staff member testifying in front of congress that the social media company, stop the presses, isn't doing enough to protect teens from sexual harassment and he had a meeting with top executives at the company about the issue after his daughter's experience on instagram. he joins us to discuss the issue and what he wants done to fix the problem in just a bit. we'll be right back. >> announcer: time now for today's aflac trivia question. what yeadir d nvidia release its first 3d graphics card for game and multimedia. the answer when "squawk box" returns. gaaaap!

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still to come, a post election day checking in with the former gop house majority leader eric cantor. we'll bring you that straight ahead. plus, a meta whistle-blower testifying before a senate subcommittee on his attempt to warn company executives of the harmful effects of social media for teenage users. he's going to join uto bak s re it all down. stay tuned. you're watching "squawk box" and this is cnbc. do you consider climate risk? changing weather patterns are impacting the way we live and the value of businesses large and small. this can mean disruption to supply chains, changing demand for products and shifting regulation. what does this mean for your business, your clients, and your investments? ice offers data and markets that can provide critical insight. manage your climate risk with ice. power e*trade's award-winning trading app makes trading easier. with its customizable options chain, easy-to-use tools and paper trading to help sharpen your skills, you can stay on top of the market from wherever you are.

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virginia democrats managing to win majorities in the state's two legislative chambers dealt a blow to republican governor glenn youngkin's efforts to gain gop control over the state. joining us with what happened, the fallout, post election day, someone who knows a thing or two about virginia, eric cantor, former virginia congressman, gop house majority leader, now chairman and managing director at moelis and company. close. we just talked, low turnout, you picked the republican -- the republicans picked up a seat in the senate, but that wasn't enough and they lost three seats in the house and that flipped the house. >> listen, joe, you got to think about, this is an off-off year.

>> off-off year. >> we didn't have any state wide officials running. youngkin was not in the ballot. the interesting point about that is he maintains real popularity in virginia. his numbers are in the high 50% of approval rating in a state that is completely divided. i think that's the story coming out of this. if we want to take anything about what this means for next year, we got a -- virginia, reflective of a national electorate, we are divided. and very, very closely. it came down to maybe 4,000 votes in the state. and unfortunately we came up a little short. >> and, so, youngkin probably is not going to jump into the fray? >> i'm not going to speak for the governor, but i would say that he -- you can't transfer that kind of popularity. that's the takeaway too. and, look, you got to hand it to him, he threw everything at it, he sort of said to the noise, keep the noise about anything

national aside, and i'm going to focus on virginia. he raised tens of millions of dollars and -- >> though he also did say that he would try and put into action a very severe abortion restriction plan at 15 weeks. is any of this pushback on that? >> ohio, no blue -- they try to claim it is blue, but -- >> there are threads of the abortion issue, certainly in ohio, that was prominent, but also in the kentucky, gubernatorial race, and certainly in virginia. the democrats threw all the money they could at that issue. >> is that a national issue that loses for republicans? >> here's the thing, though. glenn youngkin's position was nuanced. and the democrats came in and just basically said that republicans are going to ban access to abortion, so essentially planted seeds of doubt in the minds of voters that you can't trust republicans on abortion. and that's, i think, what happened and the takeaway, very difficult to nuance.

>> but is that a national losing election for republicans if the election is next year? >> i think when you got an electorate that is as divided as we are as a country, the intensity that attaches to the issue of access to abortion services does drive turnout. and i think that's -- that's the takeaway. as we look forward to next year's presidential election -- >> you'll see republicans start -- they're going to become -- when the population moves, it just takes a while for both parties. >> listen, but it wasn't that youngkin's position, it was nuanced, and then i think -- >> that might be the state of virginia. but go to ohio, the rest of the country, you can make this argument about specifically if you want to, idiosyncratic basis about youngkin, but the rest of the country is not in the same -- is not having the same issue. >> i think in, again, what the issue was in ohio, i have not

looked at sort of the granularity of what was going on there, but i do think what they said was when listening to governor dewine that the referendum question was put into our state constitution access and it will be up to the physician as to how long that physician has the right to perform an abortion. and so, unlimited in a way, which is an unreasonable, you know, kind of position to take, but yet voters listen and said, oh, we can't trust republicans, they'll ban it. so -- >> it wasn't close. it was 56-44, there was no -- >> very hard to nuance that question. and then the question in virginia is, like, youngkin tried to go on offense on this and tried to offer up a position rather than just talk about crime and public safety. i'll tell you, that is a poignant issue as well. and there was one -- there was one race, it was a prosecutor, commonwealth attorney in loudon county, up in northern virginia, he was one of the most

left-leaning progressive prosecutors, george soros funded, he lost. he lost, which is interesting. in all this sort of -- because it is an issue. i do think that -- >> too far. >> too far. joe biden, democratic nominee, 95%. 98. >> i think so. donald trump, the republican nominee, 90%? >> i just find -- i don't see how he's not our nominee. i don't see it. >> what if he's convicted? >> well, listen, if he's -- andrew, you know -- >> convicted, go on appeal. >> that's right. >> are you going to vote for him? >> i'm a republican. >> you would vote for somebody who is convicted? >> i will vote for a republican, yes. i think where -- and this is an amazing thing to me, you think that some of that is maybe crazy, andrew, you look at the other side, and what's going on in streets of these cities on the question of -- >> are you going to vote for

biden if he's 86 at the end of his term and kamala harris is the vice president? are you voting for biden? >> you look at the issue of public safety -- >> you asked a question -- you put him on the spot. >> i am putting him on the spot. >> if camekamala is waiting in wings, you're going to vote for biden? >> how would you put our world in that position? >> you're not answering. >> i'm not -- i'm the journalist asking the questions. >> that's good. >> how in the world would you -- >> would you hire a convicted criminal at moelis? would you? here is a serious question, would you put a convicted criminal on the payroll of moelis in front of your clients in a board room? >> i don't think that's a relevant question. >> it is a completely relevant question. >> we are regulated entity. we would be precluded. >> -- bingo. >> you see why the poll numbers are up. no one believes these are real convictions. >> that's right.

>> no one believes it. if you have an attorney general that says -- >> you don't believe they're real? >> i do believe they're real. if you have an attorney general that runs on elect me because i'm going to take this guy down, that's not normal. >> how do you square that? that is true. how do you square the fact, you got some -- a politician up here in new york -- >> i don't love that. >> right. i don't love that. >> it stinks. the whole thing stinks and this is why the country, i am so sorry to see we have gone down this path, because we are going to start to look like a banana republic whether we got vengeance and all the motivations that are behind what is going on -- >> the charges in georgia are different. >> the charges in georgia are different. the charges in washington are different. >> you got the documents case, where, you know, bill barr will sit here and tell you he thinks on that one in particular that there are some legitimate, you know, sort of -- >> as a man of judgment and character, i'm going to give this to you -- >> here we go. >> i say this because i think your job today, you work on wall

street, is to go into board rooms and speak to corporate clients and others, and have credibility that you have good judgment, that you are a man of judgment and character. okay. people are hiring you, shareholders are effectively spending money to buy your judgment. okay. and what i'm saying is i do not believe, maybe i'm wrong, that you would put donald trump on your payroll. >> i just told you, it is not even a relevant question. >> are you still being the journalist or now something else? >> i'm asking the question. >> okay. >> it is just not a relevant question because there are regulatory constructs, you cannot -- you know what is required. >> take the regulators out of it. take the regulators out of it, do you believe your clients would be satisfied if you walked into a board room with him to stand next to you and to present to the board? >> andrew, look, there are -- there are extenuating circumstances in how many -- how many lawsuits and indictments

are there, how many incidents of questionable motivation on the part of -- >> i don't disagree with you. i think there is -- >> you would feel totally comfortable vouching for the character of biden inc.? >> wait until all this comes out this year. >> you feel totally comfortable putting him in front of a board at this point? >> at the moment he has not been charged with anything. so let's just -- >> the other person hasn't been convicted of anything. >> well, my goodness. >> the problem is, andrew, let's go back to what is relevant as to the direction of the country. >> all i'm saying, by suggesting you would vote for him, you're saying this is a normalized thing. >> it is all good. >> there is 80 million whackos in the country that might vote for him again. you're impugning every single one of them? >> we'll see. >> you're impugning the judgment of every single one of them. >> i'm not here to impugn the judgment. we have a primary system which -- you can decide what is going on there, but then we

have -- then we have to deal with the election. >> can we go there? i think that's the root of the dilemma that the country faces. in our electoral process, we have a primary system where at best, at best 15% of eligible voters are participating in that process. >> he said in new york you got 6% that turn out in these primaries. he would like to see mobile voting. he's designing a system, he says it is incredibly secure. would you support that? >> yes, i think -- i was going to say, in virginia, i know we're under 10% in terms of participation. this is the problem because when you get that small of a universe of voters, you're going to produce more extremes. if we had somehow a focus, by both sides, but i'm most concerned with my side, if we had a focus on expanding the universe of electorate in primaries, gosh, we could be a lot more competitive. >> i heard a comedian this week talking about how his grandparents told him you should vote for the candidate you would like to have as your neighbor.

he said in this one, you have biden wandering around in your yard at 2:00 in the morning or have trump on the other side trying to sleep with your wife and tell you he's not doing it. >> okay. >> good luck with that. >> this is -- andrew, with all of this, it is not going to be a discussion. i think there is grounds for people to start to say, okay, we're not going to change the ability and right to assemble as a party, but we certainly have the freedom to participate in that and to put resources to work at a primary, primary level would be, i think, the most return we could get as a democracy. i really do. >> shouldn't have to pick between two really bad options. >> this is where we are. >> by a degree, maybe you're right. i don't know yet. i see stuff that boggles the mind with the way things are handled when he was vice president with the son and

everything else. >> it's coming. >> four, five houses, pay cash for -- there is a -- >> if you're selling -- if the only asset you have is -- >> what was becky's analogy, one person -- you can say it again, repeat that. which would you prefer? >> i know, but it is a -- >> which would you prefer? i don't think they're in the same league. >> can we talk about which policies that might result from -- >> this is the question. >> can we talk about the policys? if you're a republican, there are things that happened in the past four years or three years that curl your toes, andrew. >> sure, but then there is -- >> you like what is happening on the southern border. >> the fundamental question about the democracy of this country. there is a fundamental question about that. and what she said -- >> day one. >> talk about polarized in the country. you think -- you think one -- you to think one of those candidates is more polarizing for the country than the other? i'm curious about that. >> i think that biden and what his administration has done, what they were able to accomplish his first two years with unifying government has set

the country ablaze. i mean, it really has -- >> republicans and democrats, they have different viewpoints. >> i understand that. i'm trying to -- >> i know. the extremity that has been introduced into the policymaking process, when you sit here and -- every single economic issue has to be -- >> you think the country is more polarized right now than it was two years ago? >> absolutely. i think obama was the beginning of polarization. obama. we were sitting here, i was in the other world and i would have told you then, i'm sure i did, this whole thing about us versus them and 99% versus 1%, occupy wall street, all started by obama. >> and you could thank obama for trump, if you really want to, responding to trump. go back to -- you could thank w. for responding -- anyway, eric, thank you. >> we got a great country. >> it is good. we'll get through this. there will be 2028 some day.

be sure to watch the third republican presidential -- >> 2028. primary debate hosted by nbc news. it begins at 8:00 p.m. eastern. we'll be right back.

welcome back to "squawk box." i'm dominic chu. let's kick off the morning movers with a check on video games. we're talking shares of take two interactive, higher by 9% now, roughly 75,000 shares of volume. the video game publisher catching a bid due in part to bloomberg who says its video game rocker rock star games could announce the next installment in the blockbuster franchise grand theft auto as soon as this week. take two is rock star's parent company and distributes the grand theft auto games. they're reportedly putting together a trailer for the game for release next month. take two is slated to report earnings after the closing bell today. then you got shares of microsoft, which are flat to slightly higher around 50,000 shares of volume. the tech giant behind business software to cloud computing and video games, of course, with activision blizzard's purchase to artificial intelligence is just about flat.

remember, its big investment in chatgpt helped power upside in this particular move. it closed at a record high yesterday and could also hit a record intraday high later on today. we'll top it off with shares of rivian, the electric vehiclemaker up 11% after it boosted its forecast by 2,000 vehicles to 54,000 for the full year. rivian said it will look to expand its electric commercial van development in sales to companies outside of amazon. we'll have much more on that story when rivian ceo r. r.j. scaringe joins "squawk box" to talk about the state of evs and why he's bullock ish on the macro environment than his peers. stay right here. "squawk box" is coming back. your life is just as unique. your raymond james financial advisor gets to know you, your passions, and the way you help others. so you can live your life.

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. a second meta whistle-blower testified before a senate subcommittee yesterday on his attempts to try and warn company executives about the harmful effects of social media platforms on teenage users. joining us right now is ar turo behar, a former consultant at instagram. he also happens to be the cdad f teenagers on social media, and that's what led to his concerns. thank you for being here today. i found your testimony to be so compelling and so painful to kind of hear about and listen. maybe you can describe to people what you saw at instagram, what you saw with your own daughter what was happening. she was 14 at the time? >> yeah, 14 at the time, and what i saw and all of her friends saw is that like

unwanted sexual advances and harassment, they happen all of the time, and they can't get help, though instagram is right there and could help, they couldn't get help. and so when we talked about it, i went back in and what i found was a culture that was focused on a very narrow definition of what was bad and by doing so was not giving teens the tools they need need. >> these are teenagers, 14, 12, 13, kids who are well under age who are being sent things like pictures of penises, being harassed repeatedly by men talking about their breasts and other things, and even when they shot back, i think your daughter shot back, somebody was talking about her breasts. she shot back those are my underage breasts. they still said that didn't violate anything. >> when you think about all the ways in which you can harass somebody, i mean, we know sometimes when we look at it that it's bad, but they for sure

know that it's bad. there's no such thing as perceiving harassment, you experience it. she was going through it. she asked for help. she didn't get any help. >> and you were somebody who worked there and who was in charge of a lot of issues, and when you brought these concerns to the management there, what happened? >> well, they didn't do anything. like there's a very simple question here, which is like what should be the right percentage of teenagers to receive unwanted sexual advances, right? >> right. >> i mean, it's a rhetorical question, as close to zero as you can reasonably make it. if you have a product where a kid can't even say help me, can you give me some help with what i'm dealing with here, it makes me uncomfortable? but for an ad you can say, oh, that's too sexualized, right? i don't know, they have a responsibility to do this, and i did my best to build up data, which is incredible the data that i gave them, and asked them, told them here's what you can do, and then they chose not

to do anything about it. >> the data showed what? how many percentage of teenagrs are getting harassed online every week? >> one in eight in the last seven days experienced unwanted sexual advance, right? 11%. >> and a lot of times this is not coming from other teenagers. it's coming from grown people. >> actually, that is something that we all should understand because what i found with my daughter is that many times it would come from other teenagers, and that's actually one of the key things because their lack of tools in dealing with this means that this behavior is nor normalized. and so a teen sends a message, and if you have a button that says, hey, help me. you know who sent the message now. the content doesn't matter, and then how many times do you send that message before you go, hey, pat, this is not the place for that. a respectful conversation. >> that's what you suggested. that there be a kind of time-out or a help button, somebody would get involved, and they said no

because why? or they just ignored you? >> you would have to ask them why they said no. >> can you speak to what actually happened? you go to them and what actually happens? they say what to you? they're not talking to you? the lawyers are getting involved? >> so what happened was cheryl wrote back and was like i'm so sorry your daughter is experiencing misogyny, i know what it means to be a woman who gets told to get back in the kitchen. no follow-up meeting. i spoke to adam about this, yeah, i get it. i understand about the button. what we should do is that button should be rewarding for the kid. the kid should be protected after hitting that button. >> adam's telling you he wants to do that. >> yeah. >> that button doesn't exist. >> i offered, i'm here to help with this, and never got in touch with me again. >> we should point out that you are not somebody who is seeking monetary compensation. you have not joined any lawsuits against this. you're just trying to get

attention to get changes made? >> yeah, i think every parent knows this, and that they knew, right, that there are things they could have done and they chose not to do them. we all intuitively know how bad it is. the numbers just show how bad it is, and i don't know. if i was an advertiser, an investor, somebody, you have to be asking some real hard questions about like what are these people up to when it comes to the harm that 13-year-old who's not ready like mentally and we knew this like ten years ago when we worked on it, to deal with what's happening. >> the pushback will be from the industry. well, you should monitor your own teenagers, keep your kids off of it. what do you say to that? >> parents know how to be parents, right? and in yof you're a parent and close to your teen, go and ask them, if you receive one of these messages, show me what you would do, right? you have to fill out a report form. and we know that 13-year-olds don't like doing that because the word report, they worry

about getting in trouble and getting other people in trouble. you have to use different language. we did this ten years ago, and they stopped doing it. >> we spoke with tim woo recently about how congress has never done anything, even though you would think both sides of the aisle could find some agreement on an issue like this, that he's seen even modest attempts to try and get the industry under any control even when it comes to protecting children get sidetracked by special interests who can't agree on these things. what's your hope with talking to them yesterday? >> yesterday was extraordinary. they -- everybody was one upping each other. both sides of the aisle saying we have to change. this has to change. it has to be better. i think there's a real opportunity right now, and if you're a parent of a teenager or you care about this, i could not encourage you enough to regach out to your congressperson, anybody who you can talk to to make this better. after my experience and what has happened afterwards, i don't think we can trust instagram or

those services with our teens if they're not willing to give them the tools that help them when they need it. >> your daughter's 19 now? >> she is. >> how's she doing? >> she's very excited that this is happening. she's very proud. we're talking last night, and she -- we talked about like, yeah, you know, you have to build these things. she would love to have them. she in her university, the woman's group, they talked about these issues and everybody had experienced these things. everybody had the same issues in trying to deal with them, and she's very excited that something might change. >> well, i hope from your lips that something happens on this front. i think intuitively it's something parents do realize. if the industry won't self-regulate, arturo, i want to thank you for joining us today and being so outspoken about what you have seen and, by the way, coming up with a potential solution for some of these things too. >> thank you very much for having me. >> thank you, arturo bejar.

wow, it's almost 8:00, very close, a.m. on the east coast, and you're watching "squawk box" live in the nasdaq market site in times square. i'm joe kernen along with becky quick and andrew ross sorkin, and u.s. equity futures, that's right, we're a business, yeah, we talk about stocks and stuff. >> sometimes. >> we're up about -- we talk about important stuff, people. up about 31 points on the dow, the nasdaq indicated up about 13, and the s&p indicated up 3. we were actually at a positive session yesterday, if the nasdaq closes higher today, they'd be i think nine straight. treasury yields 4.55 now, we haven't seen -- that's an intermediate term low, i think on the yield for the ten-year, and the two-year is actually -- it was like right around 4.99 for a while. let's talk about today's top stories coming at you right now.

facebook owner meta announcing a new policy starting next year under which advertisers will have to disclose when political and other ads have been digitally created or altered, including through the use of ai. this could be something like a video being manipulated showing a real person saying something they didn't actually say or digitally changing footage of a real event that had actually occurred but then changing it. meta says if it dertermines an advertiser did not make the required disclosures, it will reject the ad with other penalties. amazon reportedly working to train a very big ai model in the hopes of topping alphabet and chatgpt maker open ai, two reports flagging the project as being code named olympus. the amazon large language model team being led by the alexa division. samsung introducing its own generative ai model today. soon among other things, samsung says the system will allow consumers to better control their smart devices.

the company also says it will allow developers to write code more quickly and for users to edit and generate images with the announcement samsung trying to beat its biggest smartphone rival apple, which has at this point not announced a generative ai product. apple making a billion dollar plus investment in its own ai model. let's get back to the markets and the trends that we're seeing with someone who can follow these as well as anyone. fair lead strategist founder and managing partner, katie stockton. she's also a cnbc contributor. and just like last time, we definitely want to talk stocks. we definitely want to talk fixed income and bonds, and maybe we'll touch on bitcoin because they've all moved since the last time you were here, katie, and i just had a laugh because are we going to be talking about the october lows but no longer 2022? there's now october lows for 2023 that we can talk about because we went from the october

'22 up to august and then we had that decline into october, and now we're up nine straight days in the nasdaq. are those the new support level? >> the support level that we were watching and i feel like everyone was watching was roughly 4,200. we had it at 4180, and as you know in our discipline, we always make sure that breakdowns are confirmed. we like to see consecutive weekly closes below a level, and that didn't happen. so with that sort of violent relief rally, we have an unconfirmed breakdown, also called a shakeout. a shakeout means that the weak holders of the market were shaken out, and that actually is a positive development. it does suggest that we'll see seasonal strength november, december, off of what is this kind of standard seasonal october low. so we still have that support intact in our work around 4180, and now it's a matter of getting through resistance. i actually wish the rally, the

relief rally was a little bit less explosive because those kinds of rallies are more common in bear market cycles. but we'll take what we have, and you kno you know, we've already seen the 50-day moving average cleared by the s&p 500. there's some minor resistance around 4,400, and above that we start talking about a return or re-test of the highs, which are much more significant resistance roughly 4,600. >> the -- what ignited it, or one of the things that ignited the equity movement was that really precipitous drop in yields last week, towards the end of last week, especially in the ten-year. does that change your outlook for the ten-year going to new highs and yields? >> it kind of helps, yeah, of course for equities at least for now. we've been calling for consolidation or corrective phase in yields, and that's not a big call. i mean, it follows a pretty massive and very steep up move,

and we think that that will continue, so we think the pullback shows enough of a loss of momentum behind yields that it will be somewhat persistent, and i think we talked about this last time. tlt, which is of course a common treasury bond etf has its first counter trend by signal since last signal on its monthly chart in april of 2020. it's the first indication that we really have in our work and that that's starting to happen in other yields and metrics as well that this could be actually more of a prolonged corrective phase, something that lasts maybe 9 to 12 months as opposed to just through year end, and that to me of course would be sort of a tailwind for equities. i think we're being hopeful at this point that that's a valid signal. we don't have proof yet that it's been confirmed. we don't have enough stabilization to suggest that that's definitely high conviction or anything. but it is promising, i think, that yields should come off.

and actually today in our research, we published a chart of 30 sort of average mortgage rates. they also have a signal to suggest that those should come off their highs. so i think that's something that, of course, home building stocks will welcome. even beyond that it would just affirm what we're seeing in terms of countertrend signals and treasuries in general. >> and i wouldn't just talk specifically about bitcoin. it actually does seem to inform some of the moves in stocks occasionally, but i thought if it got through i think you said 35,000 that that was an important level, but then not much -- what'd you say after that, 36,000 was important, so it is above 35,000. i saw ber rand's piece that says if it stays here it could be above 40 near-term. is 40 in the cards yet? >> we saw that base breakout a few weeks ago from bitcoin, it got above our cloud-based resistance level, and the

secondary resistance was as you mentioned around 36,000. so this is a natural place for this strong up move to take a brief pause. if that 36,000 is cleared decisively, then we have next resistance just above 42,000, and that's based on a 50% retracement of the bear market cycle that proceeded the breakout for bitcoin. we have seen the correlation to the nasdaq 100 index sort of resurface here, but it's obviously not something that we can depend upon. i think, if anything, we can just generally look at bitcoin in the morning and say, well, you know, bitcoin is up sharply, it's probably not a big risk-off day more broadly. >> so not just 40, but it would be -- it could indicate above 42,000 if it gets through 36,000. >> and we're seeing much better at sort of action, momentum behind the alt coins as well. i know chain link was one of

them. you know, ether is participating. it is a broad-based move in the cryptocurrency market in the same way we've seen breadth improve for equity. it has been much broader than we saw during any of the past oversold bounces since the summertime high. i think that's encouraging, if it's something that is sus sustained, that would be a bullish development. >> okay. and who are you voting for for president? >> i'm going to stay away from the politics. >> i'm kidding. >> what do you think about instagram? >> yeah. >> oh, i know. that was a great segment, though. >> oh, thank you. i guess, i don't know why i'm taking credit for it. anyway, we're all part of the show. thanks, katie. good day to be on. >> of course whnc. a markets conversation you don't want to ss wmiith alt meter capital's brad gertner. stay tuned, "squawk box" will be right back. nderstand your needs, then customize a netapp cloud services solution

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on cnbc. we are watching a few big stock movers, this morning, first up. trading platform robinhood, which is falling after a slowdown in trading activity, contributed to a third quarter loss. it's now down $0.84. there's also a revenue miss, but in this case because it's a $9 -- was a $9 stock, it's almost a 9% drop, and it's not even a dollar.

next, boeing supplier spirit aerosystems down after the company proposed a sale of $200 million in common stock and announced plans to issue some convertible debt. that's a little bit dilutive there. down about 14%. finally, on the positive side, cloud monitoring software c company datadog coming off its best day ever, shot up 28% on better than expected earnings, and better-than-expected guidance. still to come this morning, disney on deck. it's been a pretty eventful three months for the entertainment giant including just this week, when the company named its next cfo. well-known name from pepsi co. hew johnston. tonight after the bell, the company will get the latest results, we'll tell you what to expect with news week editor at large and former nbc cable president, tom rogers. stay tuned. you're watching "squawk box," and this is cnbc.

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welcome back to "squawk box," warner brothers said discovery reporting a wider than expected loss, although the company reported beltter than expected cash flow revenues.

the smash summer hit barbie did help results as an entertainment industry struggling with an anemic advertising market. this quarters results put warner brothers discovery on track to meaningfully exceed $5 billion in free cash flow for the year. >> did you know that barbie is the biggest movie ever for warner brothers discovery. i saw him yesterday and he was talking about this, $1.4 billion and counting. i knew it was a huge hit. that caught me a little off guard. that was what -- >> biggest blockbuster. interesting. anyway, disney is set to report earnings after the closing bell today, among the headlines surrounding the media giant in the last few days, it said it would buy the steak in hulu held by cnbc parent company comcast and announced it's going to be bringing on pepsi's c cfo hugh johnson. joining us now is tom rogers,

he's of course the former nbc cable president and a cnbc contributor, and tom, that's the short list of all the major moves that are happening right now at disney. you've got subscribers for their streaming services that are coming into question, what to do with espn. they're still in the midst of a restructuring with thousands of layoffs. what do you want to hear tonight? what do you expect to hear? >> well, becky, they got very tough trends going against them as all the traditional media players do. they're coming off of a very tough quarter last quarter, and they have a bunch of very tough deals to get done. so anything that is good news here i think will help. i think probably what people are most anxious about are hearing some indication of where the deal front is. they have hulu that obviously isn't going to get resolved for a while, and that can only cost

them more money relative to how that arbitration process is likely to end up. they've talked about spinning off, selling abc. no one can really understand how espn can continue to maintain its key role in the sports industry, if it gives -- if disney up its broadcast network as broadcast networks are increasingly important for sports right. the espn front is another difficult one. it's hard to see a tech company over paying for minority interests, and it's hard to see a sports league paying cash for some kind of position there. they're going to have to deal somehow with nelson pelts in all likelihood, and that may involve some other kind of deal. they have huge sports losses and how they get out of those in terms of selling their star sports interest in india one way

or another is another critical one. and then they have two deals that people need to hear how they're really going to impact their world going forward. the charter deal that was completed where they look like they got a reprieve with getting disney plus distributed within the core cable bundle, but it's hard for me to think that that's not going to just raise the price of the core cable bundle and turn cord cutting into cord slashing where it's already at the highest percentage of sub lots that we've seen, and then you have the espn bet deal, which they did with a 2% market share player and how that's going to transform espn in some meaningful way, i think people want to hear about. so a lot there to get through. >> definitely a lot to get through. it you're looking at the stock, and i realize you're not a stock analyst, tom. the stock down 15% over the last year, down 28% over the last five years. you just got to wonder if you

get to a point where the ip that disney has, if they're able to make that work with the park somehow, is that something that will save them or are is that going to be too reliant on if there's a recession? >> well, when you look at disney and you put the kind of multiple against the parks that it probably deserves if it was being assessed by travel and leisure analysts rather than the media analysts, you're left with the rest of disney valued somewhere between 40 and 50 billion, which is about one-third of the -- of the value of netflix. so looked on on that basis, the media side of disney could be viewed as highly undervalued and most analysits think it will po. i think it's going to take a while for some resolution here. the main issue they got to answer is how are they going to

get to global scale here? they've rejected the notion of getting down to the core of the parks and disney plus and the studios and spinning off abc and espn. they've rejected the idea, it seems, of a single bundle of sports and hulu and disney all together in one package that could compete in terms of bulk. and so the question is how are they going to get to global scale with so much money going against domestic sports, right, so much money going against capex and the parks. how is the streaming business going to redevelop into a worldwide player? >> and as you pointed out, they're facing a lot of the same headwinds that most in the industry or everybody in the industry is facing, maybe less netflix or somebody else. how did they fare comparatively?

>> those trends are very tough for everybody. you have cord cutting accelerating. you have netflix clearly pulling away from the pack competitively. they're all suffering in terms of no fresh content because of the strikes. the legacy players are all raising price while cutting back on original content and licensing a lot of their library. that seems like a very tough formula for really to accelerate driving subs and scale. last quarter, of course was the first time disney plus lost subs in the u.s. hulu and disney plus were actually down in advertising last quarter, and then you have the ascendant youtube, which is becoming a major, major player in connected tv. and you have sports rights that are increasing faster than revenue are increasing. and so all of that is what they need to contend with like all the other traditional media players do. >> okay.

tom, obviously a long list of issues for all of these companies, maybe disney in particular, though. but thank you for joining us today. >> thanks for having me. a programming note for you too. don't miss an exclusive interview with disney's ceo bob iger. that's this afternoon on cnbc after disney's fourth quarter results. make sure you tune in for it. coming up, brad gerstner from altimeter capital joins us to talk about the latest stock market rally and where he's looking for opportunities in tech and more. but next we're going to go inside ev maker rivian's third gngter report, ceo rj scaringe isoi to join us. stay tuned. much more of "squawk box" after a break. the first law of thermodynamics states that energy cannot be created or destroyed. (♪♪) but it can be passed on to the next generation.

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still to come this morning, altimeter capital's brad gerstner will join us live on set for a wide-ranging markets conversation. "squawk box" will be right back.

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shares of ev maker rivian are rising after the company posted a smaller than expected third quarter loss and a small beat on the top line. cnbc's phil lebeau joins us now along with a special guest. good morning, phil. >> let's bring in rj scaringe, founder and ceo of rivian. you heard what andrew had to say there, rj, better than expected

results in q3, you raised guidance for q4. how much of that is a reflection of the fact that the demand that you're seeing for your vehicles is not softening at all? >> i mean, we continue to see a tremendous amount of excitement for our products and ultimately, we think the manifestation of the product features, the product design coupled with the positioning and the branding that we've built around the business around the products that's really connected with customers and resonated extremely well. >> yeah, but you know the chatter that's out there right now, rj. there's a lot of hand wringing in the market that ev sales growth is slowing down and won't be growing as quickly. where are most of your buyers coming from right now? are they coming from previously owning an ev? are they coming from internal combustion engine models? >> the vast majority of our customers are coming out of internal combustion vehicles. on the order of 80% of our customers have never owned an ev

before. so it's really exciting as a brand to be essentially the pathway or the gateway into electrification for a lot of customers. >> you know, you and i have talked about the fact that the pickup truck market, the electric pickup truck market is going to get more crowded. you have cyber truck being unveiled, the first deliveries starting later this month. you've got both ram as well as gm rolling out new models next month. when you look at that ev pickup market, it's different, though. i mean, ram yesterday said we're going to have an electric but also have an onboard gasoline powered basically generator. is the pickup market, electric pickup market, is it splitting into segments as you see it? >> look, i mean, i think first i'd say broadly there's been a lot of noise, as you said, just around overall electrification and the pace at which it's moving. i want to be emphatic in saying we're very convicted, deeply

convict insteaded in that the e of the automotive industry will electrify over the next couple of decades, 10 to 20 years. in order for that to happen, we need to have a lot of different consumer choices. we need lots of variety. we need different brands, different form factors, different price points, so we think it's very healthy and very important that manufacturers outside of ourselves create products that are compelling and interesting. and as you said, there's going to be very different takes on every segment, whether it's the truck segment, the sedan segment, the crossover and suv segment. so we hope there's lots of choices and lots of variety in the space. >> just to put a finer point on this, do you see the demand for electric pickup trucks as great as many were expecting a year or two ago, or do you think that it may not be as big as many expected it to be? >> i think it just depends on your time scales. i think it's 100% of truck sales will be electric. it's just is that a few years from now or ten years from now

or 15 years from now? i do think it's really important to note that not -- when we see the electric vehicles that are available today, there's a number of vehicles that are selling very poorly. there are some vehicles like are selling extremely well, and just like in the ice world, the product attributes, the feature, the branding and sort of positioning of the product all really matter, and being electric is by no means a guarantee that a product's going to be successful and vice versa. being electric also doesn't mean that there's going to be a vacuum of demand. i think it really requires the product to be execute instead a way that strikes a chord with consumers and generates, you know, really extreme interest in what the product's about. >> rj, i appreciate you getting up early on the west coast and joining us this morning on "squawk box." rj scaringe, founder and ceo of rivian. guys, the stock is up more than 6% following those q3 results and the improved guidance.

i'll send it back to you. >> okay. thanks, fphil, appreciate it. coming up on the other side of this, aimerltet's founder brad gerstner will join us. you don't want to miss this. you're watching "squawk box" and this is cnbc. i'm so glad we did this. i'm so glad we did this. i'm so glad we did this. i'm so glad we did this. i'm so... ...glad we did this. [kid plays drums] life is for living. let's partner for all of it. i'm so glad we did this. edward jones (swords clashing)

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welcome back to "squawk box." i want to talk more about the markets and bring in our next guest, here to discuss the venture capital environment, ai, the ipo market and so much more including your ideas of an investing in america, which i want to talk about, brad gerstner is here, the founder and ceo of altimeter capital, he's made investments in snowflake, bytedance, okta, orbit and so many others. where are we sir? >> good to be here. >> nice to see you. where do you think interest rates are going? what's the risk-on, risk-off situation? >> well, you know, we've been through a pretty epic journey over the last three years. i think i said about 18 months ago that the new normal is going to look a lot more like the old

normal, faster than we think. but we have to get through this process of adjustment. >> what is the old normal? >> so if you think about the period of time for 2010 through 2020, we were roughly at 2.8 on the ten-year. i think we're going back to a period of 3 to 4 on the ten-year, a highly investable period. what people can't deal with is the volatility. right? just think about this, in the last six or seven weeks since july, we have a 25% move in the ten-year, right? and so the nasdaq is down 12% during this period of time, and then of course we've had this run over the course of the last eight days. that's the process of normalization, as people try to get their arms around where is the ten-year going to settle out? i look at inflation, the pc over the course of the last four months is annualizing at something like 2.5, 2.6%. we think by summer of next year, you'll have a two handle on inflation. nobody wants to acknowledge that

there's an envelope here for a soft landing, and we have our issues. we have our issues. we certainly are slowing down the economy, but i think the missed positioning this year, if you will, is that everybody was prepped for a hard landing. mike wilson had scared everybody at the start of the year, so everybody was in crash position, and the reality is the market has performed quite well this year despite a regional banking crisis, despite conflicts in ukraine and israel, despite all of these other challenges. >> so you're bullish? >> i would say that we've been constructive and optimist all year. our net exposures, we started the year very bullish relative toy to where prices were in the market. we were priced for a hard landing, so we were 93% net long, andrew. >> you're through the worst of it? >> well, the question on the table now is does the fed over bake the cake, right? may of 2000, let me take you back.

>> what was the ten-year in may of 2000? for me, 3 to 4 is still -- >> is a no-brainer. >> but it's still a new normal. we used to be 5 or 6. why don't we go back -- >> i'm saying that because we don't need to. i mean, the fact of the matter is that so long as we have full employment and so long as we have stable inflation at or near the target, we're going to be in this lower range, but the fact of the matter is, joe, as you remember, we did great between 2001 and 2007 with a much higher rate environment. but what we need -- >> in the '90s. >> we need predictability. and what we haven't had the last three years is predictability. and you know, listen, we beat a pandemic. in march of 2000 when i came -- or 2020, when i came on, we didn't know if this was ebola. >> yeah. >> right? and so the fed went all in, congress went all in. that was the right thing to do. but by the summer of '21 when the fed was saying they don't see inflation, that was clearly a mistake. the cost of a cargo container

from china had gone up 10x. so we waited six months too long, and the consequence of that is we had to go a lot higher. if you look at the fed's own forecast for next year, 1.5% gdp, two to three rate cuts, ending the year with a two handle on inflation. to me the thing that people have been most mispositioned for is that the world may, in fact, go back to -- you know, to this normal. for us, our net exposure today is 60%, like i said, we started the year at 93. so we've taken some risk off the table as prices have gone up, but we're still leaning forward and still bullish on america. >> what do you like? we've spent a lot of time talking about ai, is thawhere t opportunity lies? >> not all tech is created equal. tech went through a recession in 2022, right? a year ago. everybody crowded into the same trades. the safety trades of bonds, the

safety trades of cyclicals, et cetera. we've seen a reversion to the mean. think about this, the spy -- s&p is up 15% this year. if you take tech out, it's down 2%. the russell 2000 is down this year. i think that's a healthy correction from where we were last year where x tech was over valued as a safety trade. tech, the best parts of tech have moved up. if you're a covid pretender, you haven't gone up this year. i see some names floating across the screen this morning. >> who's the covid pretender in your mind? >> i see a name this morning like upstart as an example. nothing against the company, provide car loans, you know, and car financing to folks. but they pulled forward massive demand during covid, and now the giveback comes. if you look at company like uber who you did a great interview yesterday, or a company like meta. they've seen expanding margins this year and reacceleration on the top line. i wrote a letter last year about time to get fit, andrew.

mark zuckerberg in march wrote the year of efficiency. and told you yesterday, quarter-over-quarter, we've actually reduced head count again. we have this massive bottom line opportunity in all these businesses because of ai. . margins are expanding. >> robinhood is running across the screen a lot too. is that a pretender company because there were so many people who were home betting on the markets who aren't now? >> pretender may be a little harsh. >> that was your word, i'm just asking. >> what i mean by that is we pulled forward all this demand that was not sustainable in a world. i mean, i look out the window here, people are back to work. >> right. >> they have to take ubers to get back to work. they're not sitting in their homes doing the things they were doing during covid, and one of those things was day trading meme stocks, so that was just the giveback. but it's incumbent upon those companies to adjust. it's hard to adjust. nobody on this set wanted a pandemic in march of 2000 -- or 2020, but that's the hand we

were dealt. >> you have a program or an initiative, i should say, called invest america. tell everybody about it. you talked a little bit about it already. >> yes, so -- you just had representative canner on this morning, and one of the things he said that caught my attention was we've never been more divided. 99% versus the 1%, right, a real threat to democracy. i think we have a historic moment right now to get everybody into the game of capitalism. so the idea is very simple, andrew. this is a bipartisan piece of legislation we hope to have introduced in the spring that would cause the treasury to create a $1,000 seed investment account for every child born in america. there are 3.7 million kids born every year in america. if we just put a thousand dollars in the s&p 500, it's only 3.7 billion, less than 1/100 of 1% of the national budget, less than the cost of a single weapons system, right, the incremental budget we're

looking for in ukraine would pay for this for 50 million kids in 15 years, right? >> take it out of the irs stuff. >> and this gets every single kid into the game, and if you look at the power of compounding, right? we talk about financial literacy. we talk -- less than 50% of people under the age of 40 believe in capitalism. >> i will tell you japan's doing something similar, not outright paying for every kid that comes through but offering massive tax incentives for every individual to be able to do stuff like this alone. >> what we don't want is another big government entitlement program. what we want to do is empower individuals, the federal government can seed it, get it going. they open up their invest america account on their phone. at 10 years old, you'll have $12,000 in that account. you owned a little bit of tesla, microsoft, of united health care, and now we have a dialogue with them because they're in the game. they have skin in the game.

we tackle this problem of hopelessness that we have in this country by giving people -- >> how does your program -- i'm going to ask -- i'm very interested in the program because many years ago i remember having a long conversation with bill ackman who we had on this program, and he had sort of developed an idea around a program called a birthright. >> right. >> it was about $6,700 per person with the idea being that actually every person by the time i think you're 62 retirement, you'd be a millionaire. >> correct. >> it was about a $6,200 compounded over time. >> yep. >> this is obviously less money, but he also had these ideas around how you'd do it so that you couldn't actually ever sell out until 62. you had to own it in various mutual funds, could not own individual stocks. so how would this work? >> so there have been, i would say over the course of the last 40 years, a lot of good initiatives. a lot of good thinking on this. they've all failed for certain reasons. baby bonds, senator cory booker has an idea to give certain kids

bonds. the problem with a bond is it doesn't appreciate. you don't learn about capitalism. you don't actually own your slice of these companies. it doesn't benefit from compounding. the challenge with bill's idea -- and by the way, i like a lot of it -- the challenge was we can't afford it, right? we have a $34 trillion debt in this country. we have a $2 trillion national deficit. so the dirfference is i want th federal government to seed it and get out of the way. think of this, a 401(k) from birth. i was with dar ra, i said if we set this up, will you match it for all the kids of your drivers and employees, right? so you add $750, you know, that year the child is born, and he said absolutely. i've talked with ceos across the board on this. we're putting together a ceo council. i talked with satya about it earlier in the week -- >> i'm told 20 years ago, brad, that the great harold ford who

was a congressman along with evan bayh, from indiana. they wanted to introduce something 20 years ago harold tells me, called baby build accounts. do you remember that? >> vaguely, vaguely. >> why didn't it work? >> i'm a big fan of both. >> you started working for richard luger. >> i did. you know, so i -- >> i don't know why it didn't work. >> when i look at the past failures, the biggest failure is that they were looking for some tie-in to social security, some offset to social security. i think we should fully fund social security. it's a totally separate program. this is completely different. >> if it gets people back to realizing that socialism has been tried, because i think it's 60% of college kids aren't sure if capitalism -- >> the rise and fall of nations occur when you have a wealth gap that grows, when you have people

who lose faith in the system. pew and gal lop are telling us people are losing faith in the system. we're not agentless. we can do something about this. so the great something from the clintons to the koch's, i've been talking to everybody. we're building a huge tent. we have bipartisan members of congress -- >> i have to ask you the question, though, what's the offset? >> first, i was presenting at a -- >> with what? >> take it out of that irs money, andrew, please. we don't need 80,000 more agents for ten billionaires. >> i have to say that when i think about the bills in front of the house and the senate right now, $100 billion of incremental investment being talked about to fund two wars, right? ukraine and the middle east. we've already spent $100 billion in ukraine. this is not a question of do we have the money. this is a question of do we have the courage to have priorities?

we have 15 countries that we send over $4 billion a year to annually in foreign aid. how can we give 4 billion a year in foreign aid to all these countries and we can't give that same opportunity to every kid in america. so i just think we need to get our act together. we need to prioritize. i for one thing that, you know, a trillion dollar annual deficit is total unsustainable. >> i agree. >> we will get on the right path about that as well because the economic engine of america, you started talking about ai. we're going to have a massive super cycle. you know, of economic growth, productivity gains that comes out of ai. first, everybody should share in it, but at the same time that's what's going to allow america to correct its course. >> what did you say the annual cost would be? >> 3.7 billion, and when i tell this to people, they're like, oh, my god. that's nothing. >> we could pay for this with carried interest. if you would eliminate carried interest. >> do it, andrew. >> you good for that? >> you think you could get

everybody -- >> how much is carried interest? >> it doesn't actually -- the point of carried interest is actually never raised enormous amount ts of money. >> give me my irs stuff and give you. >> a billion and a half out of carried interest, and spending on the irs. this is the problem with all these proposals. people get into this bunker mentality. it starts with one party. this is something that can unite the parties in this country. >> the irs issue is a different one because if you can't actually maintain the law, then you have a bigger problem. >> oh, please. okay. >> who are you protecting? who are you protecting, the billionaires? >> all the cheaters? how do you know they're cheating? >> that's where the cheating is happening. >> and it's going to pay for itself by collecting more? that would be the first program in history that paid -- >> i think what we can agree on is this. we needed emergency spending

during covid. if the fed and congress had not gone all in, our economy would have stalled out. okay? the problem is we got addicted to it, and we still, right now, we're spending a trillion dollars more than we were in 2019. we talked about meta. meta's saying, we got to get fit. year of efficiency. flatter is faster. leaner is better. the federal government needs to get fit and needs to get the deficit down. >> 100%. >> get us back to 2019 spending levels. when we do that, we need to set national priorities, and one of those national priorities needs to be bringing every child in america into the game of compounding and capitalism. if we don't, it threats the very roots of capitalism. >> look, the practical problem with this is going to be small businesses will say, wait a second, you're investing in big companies, it's going to make the big company stocks effective and efficient. i believe in this. i've got accounts for my kids where we do an s&p 500 so they can see some of these going

through it, but the practicality of getting this through and getting all sides is not just the discussion we're already having here. it's the government picking winners and losers. >> as bill clinton said to me, s&p 500 is good enough for america and every other indexer, good enough for this program. >> i'm not arguing against it. i'm just saying that will be yet another hurdle. >> i'm ready for the fight, and we've got great people leading this initiative, got great authors and co-sponsors coming together. it's just common sense, and you know, i've started four companies, andrew. and the first thing you look for as an entrepreneur is product market fit, because the fact of the matter is, you may love the idea, but if you can't explain it in 30 seconds to somebody and they smile and they get on board, it's not going to work. this has one of the highest product market fits of any idea i have had in 25 years. i think we can get it done. >> we look forward to following your progress, sir. thank you for being here this morning. >> i like the lessons that it teaches. i do. >> i think it could have a huge

impact. huge impact. >> well, you know, it is pretty astonishing to me that trump's folks are on board, and clinton -- bill clinton said, i want to be your personal advisor to get this through. like, where is there something else elsewhere this could happen? the key. i was with kevin mccarthy in his office for an hour before this summer, and kevin said, you know, talking through it, and he said, this is a great idea. we got to make this happen. and now every republican is against any new spending. >> right. >> and i said, yeah. he's, like, says to his chief of staff, find me $10 billion. and he looks at me and he said, how much was it again? i said, 3.7 million kids, $3.7 billion. he said, we can pay for that a hundred times over. >> did he say that? i think he's on tomorrow. >> thank you guys for giving me the opportunity to talk about it. >> fantabulous.

>> and dara really is -- >> the cameras are still rolling. did you know? >> i was ready to pull my pants down. unbelievable. >> that's happened, just not outside. i told you, don't look outside. >> that would have been a gordon bethune moment. >> if you didn't think we were on, you could do better than the s-word. >> we're still on tv. brad, thank you very much. on the other side of this, top stocks moving ahead of the bell on wall street. stay tuned. you're watching "squawk box," and this, yes, is cnbc.

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all right, just over a half hour to go until the opening bell on wall street. dominic chu has been checking out everything that's moving in the premarket. you want to get us up to speed? >> we hand got a handful of ear movers. biogen is one of those. it's been moving between gains and losses, up about 0.25% right now. just around 7,000 shares of volume. the biotech company behind key drug franchises tied to treating cancer, multiple sclerosis, among other things, did cut its full-year profit forecast due to higher merger and acquisition-related costs. a couple of consumer-related earnings headliners as well. under armour up nearly 2%, just around 200,000 shares of volume

for its voting class of stock. this is after they reported better than expected profits on revenues that were in line with expectations. it also affirmed its full-year profit forecast. profit margins did improve due, in part, to lower freight costs. we'll end on ralph lauren. that retailer has been moving between gains and losses, but right now up about 2%. ralph lauren was helped by sales growth in europe and sasia. it did forecast current quarter, holiday quarter revenues, that were below some analyst estimates, citing a more cautious environment around wholesale demand, so those consumer names throwing out mixed pictures with regard to what the holiday season could look like. >> yeah, we got a lot to dig through before we get to the holidays. dom, thank you. we'll see you later. here's a news alert. the culinary union in las vegas says a tentative agreement has been reached with caesar's

entertainment for a five. >> year contract that would cover approximately 10,000 hospitality workers and avoid a strike. strike threat still looms, though, at mgm and wynn properties. becky? we are going to get a final check on the markets right now. again, we've been watching all morning, and after eight days in a row of gains for the nasdaq, its longest winning streak since two years ago, you're going to see modest advances this morning. nasdaq up by about 10 points, dow futures up by about 40 points, the s&p futures up by 4. treasury yields have been under where we're used to seeing them. ten-year is well below 6%. the two-year is even below 5%, and we're continuing to keep an eye on that. oil prices this morning hit a low of $75.86. that's its lowest level since july 21st. there have been concerns about what's happening with demand around the world. you can see wti down by about 57

cents. i think demand in china was one of the big concerns off some economic numbers. wti also settled below its 200-day moving average yesterday for the first time since july. folks, we're going to wrap things up right now. it's been a fun morning. we have been glad you have been here with us. we'll see you tomorrow. right now, it's time for "squawk on the street." ♪ good wednesday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer and david faber at post nine of the new york stock exchange. the dow up seven days in a row, longest streak since july. another wave of earnings and fed speak today, including fed chair powell this hour. oil approaching $75, lowest since june. our road map begins with stocks trying to build on this rally. s&p and nasdaq are riding their longest daily win streaks since 2021. microsoft shares closing at another record high.