today, it's wednesday, november 15th -- that seems odd it is the 15th "squawk box" begins right now. ♪ good morning and welcome to "squawk box" right here on cnbc. we're live at the nasdaq market square in times square i'm andrew ross sorkin along with joe kernen and melissa lee. becky is on assignment we've got three hours of lots and lots of news making. we've got nikki haley. >> she's here. >> not yet, but she will be here. >> don't adjust your set. looking at the green s&p 500 up about 17 points this coming after stocks rallied yesterday in a big way after wall street cheered that soft inflation data

dow rising by 490 points, the s&p notching its best day since april of 1.9% and the nasdaq rising by 2.4% it bridges the gains now in november to 5 to 7 to 9% respectively that's for the dow, s&p, and nasdaq take a look at treasury yields now as well. we'll show you the 10-year, the 5-year, the 2-year but tom lee who said it with us go ing to be a rip-your-face-off rally was right. >> he was right. >> he was right. it became -- if the number came in -- if it was a good number, whatever the good number was, it would be good for the market if it was a soft market, even better. >> he's an inflation whip whisperer. his last call was about inflation. yeah he seems to have a feel for what's going on. >> right. >> i did see one weird thing, you know, twitter conspiracy was health insurance down 38% or

something? someone said health insurance in the readings i'm going to ask steve liesman about it. >> oh, within the cpi. >> yeah. it was down sharply. which was part of the -- that could be a point -- 0.1 itself. >> the 10-year yield going down 4.5% $2 billion combined added to the magnificent seven alone. really sizeable gains there. >> just not all in energy. >> no. >> it was like half a percent gain. >> was it a gain on a relative basis, it was the weakest. >> the weakest, yes. on today's "squawk planner" you'll hear about tjx after the oh "opening bell." several data points to watch we'll get the october read on producer prices and the government's retail sales

numbers. inflation in the united kingdom in the meantime falling sharply to 4.6% year on year, hitting a two-year low headline cpi was flat on a monthly basis. among the big effort downware contributors, housing, household businesses, food, and nonalcoholic beverages and meantime overnight in china, more retail sales in retag production surprise to the upside both are recovering from the struggling consumer in china you see their gains following the lead to the u.s. markets over in china. >> courtney is here. i think she'll talk about these. i mentioned it to her. some of our competing networks are all over this, target stopping the deputies from coming into the store to prevent the shoplifting. a california sheriff just ripping target for not letting his guys in to prevent the

shoplifting. i don't know if that's widespread or whether he's grandstanding or what. you don't want your employees hurt you don't want your customers hurt obviously but then again do you say, come on in? take the more expensive stuff if you're going to fence it is over here the small stuff -- >> that's all behind glass. >> they've locked up all the expensive stuff. >> i know. you can't buy ulcer medication in walgreen. >> right or deodorant it's locked up. >> you've got crack pipe dispensers, which are free, over here we live in a crazy world. last night the house passed speaker johnson's shutdown plan which would keep the government funded all the way, all the way through early 2024 so -- >> two whole months. >> we've got clear sailing for

like six weeks, so enjoy the current funding is set to expire on friday for more on this let's bring in juliegrace and cnbc's washington correspondent emily wilkins. thank you both -- >> thanks for having me. >> yeah. you're welcome. >> good to be here christmas is saved. >> what a difference like six months make or actually three months, emily. so the crazy eight and the freedom caucus are okay with -- they've only got 90 republicans. it's all democrats that's okay for the speaker to do it that way >> i mean at this point what i ooesh heard from a number of republicans who voted against the bill was saying, hey, you know, we're not super -- we don't like this. we don't like that there weren't priorities like border security and spending cuts. that's why they voted against it

a lot were willing to give speaker johnson grace. they knew he was new on the job. he said he would not pass any more of these stopgap bills. that was a pledge he made yesterday. at this point, i think there's just some exhaustion in the house. they don't want to go through another speaker battle at this point. this is probably a mark against johnson for some of these more hard-lined conservative members, but at this point, it's not enough that it's going to actually lead to another motion to vacate and he's going to is actually have time between now and january 19th than now and february 2nd to try to actually negotiate with the senate and potentially get some of the spending bills done. >> emily, you can talk about whatever you want, but there were also side shows going on that we like to focus on do you remember parliament -- someone cold cocked someone a couple of years ago.

there was an actual fist thrown that landed. i think we've got something to watch and then you can comment it's a tough place now, isn't it, the house? >> somebody called it a pressure cooker yesterday i think that's -- i'm sure juliegrace knows this as well as i do the house has been in session for ten weeks at this point. there's a lot of pressure, a lot of tension, a lot of stress. members just want to go home at this point that's why you're seeing these allegations that kevin mccarthy pushed tim yesterday. >> here it is. i think we have it cued up, ready to go. >> do you want to do it now? >> i'd love to do it now. >> stand your butt up. >> you stand your butt up. >> stop it no, no, sit down sit down. >> look at you. >> no, no. you're a united states senator sit down, please. >> oh, okay. >> you and mr. trust fund continue to try to --

>> i'm reclaiming my time. >> no, i'm not giving your time back you can stop the clock you look like a smurf here going around in all this stuff >> why should they believe you why should they believe you? there's a different rule for the president? there's a different rule for you? why should we believe what you're saying, mr. chairman, why? >> 145 members of congress that voted against him. he publicly called me out. he didn't see any cameras. npr was paying attention. >> i guess a reporter was interviewing burchett. i guess our shoulders bumped somebody asked me. i did not run and hit the guy, kidney punch him. >> you didn't shove him. >> no. >> that paragon of good behavior in the house, juliegrace matt gaetz has already filed some type of complaint against

speaker mccarthy, but there's no bad blood between these two. >> never a dull moment yesterday got weird. ten weeks spending time together, i feel like tensions are peak-high. kevin mccarthy is kind of seeking attention on all of this that being said, tim burchett said yesterday afternoon his kidneys still hurt after mccarthy allegedly pushed him there. no love loss in voting mccarthy out and kevin mccarthy there. >> boxers kidney punch you really should. et do it, but it's effective. >> i can't believe the mullen piece of it. >> we've had him on. he's a new senator he was in the rough and tumble house for years. >> he wasn't at -- >> what's that >> he was an mna fighter at one

point in time. i saw him take his wedding ring off. >> i love the guy, i do. i've been with the -- he's been on do you -- >> i can't believe this is what happened to the country. >> have you ever wanted to take me outside i know you've wanted to go outside with me a couple of times. a couple of years ago? definitely things get heated. >> not like this you want your senators to comport themselves. >> you've seen the rest of the world. you've seen what goes on in south korea. they cold cocked a guy. >> if you're comparing ourselves to these other -- >> that's democracy around the world. we should be -- >> democracy is messy. >> we're role models for children what about a child seeing this not good. >> kids have their own problems with social media. they see stuff they should have never seen. >> we're going to to the absolute bottom.

it's like a race to the bottom. >> do you want to take this outside, sorkin, right now >> what i want to know is whether voters look at this and say to themselves, is this america? really, is that what we're sayings, joe by the way, there's an argument you made voters voted for these people. they think that these people are good, that these are their role models is this what we decided america is supposed to be? if that's the answer -- i'm not saying that's okay, but maybe it's the answer. >> with all the things happening now on college campuses and new york city and what happened -- by the way frmgts all these terrible things are happening with elected officials >> you're watching the decline of western civilization, but i don't think you need to -- you know, e i'm not -- >> lament it >> i'm not willing to hang it up and say our system is brothersen because things get heated in congress. >> i don't think that's heated that's something else.

>> like i said, how long does -- democracy goes back aways. if you call what uk has democracy, we're talking about the lajd of kings and queens and comporting yourself, you know, where every carriage takes 10,000 years to build, and they still cold cob people over there. if lee action at what goes down under, it's real emily -- well, juliegrace, they got it done at least and we made the point that, wow, we can relax now. till when? >> till -- i guess until mid-january. so in congress, things can always get weirder we'll see if temperatures fall after recess we saw mike johnson say no more crs, that they're going to works out the process. it still remains to be seen. we'll see if temperature is back up

we'll see possibly fist fights in january. >> we had the speaker on we talked about hundred days and honeymoons and things like that. he's in a bit of period where he's getting leeway from both sides of his party and i guess, maybe -- i don't know that the other side is giving him any leeway. they have their own self interest at heart, but how long -- >> i would think at this point the honeymoon is over because he has said he's not going to be moving another stopgap it's time for everyone to roll up their sleeves and start negotiating the bills. the house is at a disadvantage you look at the bills the house senate passed. they can move it through the house. it's non-bipartisan. you tally up the number of days they're here with the holidays it's just not a lot of time. >> all right

all right. i thank both of you, juliegrace, emily. thank you both. i know where you're going. you're going to blame this decline on trump do you remember al gore in that one debate where -- he kept coming up and saying, he's coming up behind me and bush finds him, what are you doing. both sides both sides here, i think all right. we're going to go to break. coming up, we'll take a look at new invefsment moves including a big bet against stoxx. and nikki haley could soon lock down the second backing on a billionaire. you're watching "squawk box" on cnbc >> announcer: this cnbc program is sponsored by baird.

visit bairdifference.com

dear moms and dads, what you have achieved here today is going to help us and our futures. it is why we're coming up on stage to collect your diplomas. mom, love you always. vo: when you graduate, they graduate. visit finishyourdiploma.org to find free and supportive adult education centers near you.

filings from two notable investors revealing they have soured on chip stocks. michael bur are disclosed a put. david also cut exposure to chips last quarter completely dissolving positions in broadcom, cadence design systems

and others also cut ties with others and introduced a new all-time high. meantime berkshire hathaway revealed late yesterday it's shedding general motors, johnson & johnson, and amazon. berkshire's cash board has gone to a record $157 billion berkshire also saying it's not disclosing one or more of its stock holdings he's pressured them to keep the details confident. he's done that in the past as he tries to build a position. as we know, when warren buffett makes a trade, one way or the other, it often is followed by so many folks who then try to pile onto the same stock, pushing up that price. >> yes we have come a long way obviously in terms of civility

and everything now we have a senate history. >> of the incivility. >> the caning incident in the 19th century have you ever been to weehawken. do you remember what happened there? >> no. what happened there? >> burr and hamilton. >> there's the idea of progress. >> is there really the more they change, for more it stays the same. >> every generation la meants the decline of western civilization. >> exactly i think things really do get heated, but there's multiple stories, senate stories of things that have happened there. and that ice the senate. coming up, this should be fun. presidential candidate nikki haley appears close for locking up support of a second wall street billionaire in the last week details after the break.

so much more than that. plus, ambassador haley will join us live on set at 7:30 a.m. eastern. "squawk box" will be right back. when you think of investment risk, 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. [phone: starting route.] technology helps us navigate to work. [phone: go straight.] but, to navigate the complexities of modern work... [phone: turn left.] ...you need more than technology. you need cdw. [phone: you have arrived.] so we'll implement cloud based microsoft modern work solutions like microsoft 365, teams and azure, so your teams can collaborate with zero trust security anywhere. [phone: destination ahead.] microsoft makes modern work possible. cdw makes it powerful.

♪♪ we're not writers, but we help you shape your financial story. ♪♪ we're not an airline, but our network connects global businesses across nearly 160 markets. ♪♪ we're not a startup, but our innovation labs use new technologies to help keep your information secure. ♪♪ we're not architects, but we help build

stronger communities. ♪♪ we're not just any bank. we are citi. ♪♪ billionaire ken griffith says he's actively contemplating financially supporting nikki haley. that follows news from earlier this week that following stanley druckenmiller plans to support haley exclusively from now on. we'rer going to talk about the fund-raising race with nikki haley. she'll join us on sets at 7:30

eastern. i don't know what was discussed with jamie dimon did you look into that yesterday? the axios report they talked regularly about the economy. >> powwowing. >> we can ask about that. >> we can ask a lot of questions of nikki, ambassador haley, governor haley, gofrmg nor ambassador. >> we've got a lot coming up plus this after the break. retail target set to report. we're going to bring you the reaction from wall street. as we head to break, 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 welcome back to "squawk box. we've got green on the square.

dow looks like it would open up 500 points higher. the dow up 93 points the nasdaq up 93 points. all of that on the inflation data from yesterday. the 10-year is down to 4.47%, the 2-year at 4.850% crude right now, 77.69 by the way, that's also helped a bit, just in terms of the inflation picture in terms of where we've been looking and then crypto. this is an interesting one let's show people where things stand. crypto has gone back up a little bit. >> yesterday. >> yeah. >> cathie wood, i don't know. >> cathie wood $500,000, right, still >>. >> and whenever it looks like the fed is going to stop or restart the printing press, bitcoin goes up. i don't know we keep making the point it's

been going up on no news. >> that would be the spotty etf. >> or anticipating the end of the tightening cycle that's sort of why when it does actually end maybe it doesn't go up. >> let's bring you other headlines this morning about two thirds of workers at gm's springfield plant has rejected the plan. that follows two rejections in michigan however, the contract still appears to be on tract for union approval by union workers and amazon has received a warning about sales of unapproved eye drops. they're selling drops that have not been recognized as safe and effective for providing safety for redness and burning. watch out for that target reporting its quarterly will results we head over to courtney reagan.

>> coming in much stronger than expected $2.10. analysts were looking for $1.48. cost controls and inventory management is what drove the news $25.4 billion compared to $25.24 billion. that was the consensus total comparable sales has dropped. digital sales fell 6%, fourth straight quarter of declines there. gross margins came in above estimates of 5.2%, target giving a pretty wide fourth quarter earnings guidance rate of $1.90 versus $2.60 compared to a negative consensus on a media call, while discretionary categories remained soft in quarter 3, it

went up. beauty was strong in stores with and without an ulta shop and shop now, target has become very vocal about theft as you know. the retailer closed nine stores because of it in recent weeks and cfo michael fadell blamed theft for higher shrink during the quarter. there's been a discussion about items being locked up and deterring theft and how it's inconvenienced shoppering waiting on store employees to unlock items when i asked him about it, he disagreed. he said actually what we hear from guests is a big thank-you because we have the brands he said there are, quote, positive responses from customers when i asked him. >> that's a tough one. customers can't believe they have stuff we actually are looking for. >> we lock it up. >> they actually can come here

and buy the things that they want and they're given a big kudos for that it does take locking it all up to keep it there does that sound reasonbling to you, courtney? >> you know, anecdotally no. we've seen so much discussion online and other sort of even more mainstream articles about frustration the shoppers are feeling, to be fair not just target but other retailers who feel they have to lock things up to deter theft shoppers are frustrated because it does take a long time if you're me, you've got a screaming tired kid in the aisle while you're waiting to get the deodorant unlocked i'm not sure how happy i am that it's in stock. >> you go there to buy things they have in stock you wouldn't go in it's not there. >> of course it's important to have it in

stock. but if it's hard to get to, that's something else. >> i ee see it everywhere. >> it is. >> weird things are locked up, i didn't realize deowed rat -- >> yes it's often things that are hard to trace, easy to resell. >> razor blades. >> razor blades, bblades, baby a they've always been high on the list but consumables. the stocks, the expectations were so low, down 60% over the past year. one thing after another. when it comes to the guidance, it's so wide also the comp store guidance for the fourth quarter is also extremely wide it almost surprisess me to see such a reaction. >> i totally agree, melissa. we talked to target about it and

the external environment and what's going on with the consumer and how people will react. this reaction is somewhat similar to what we've seen in past earnings reporting over the years where they've done a decent job delivering the courter. the street seems to be looking past that because the expectations were so low going in a couple of analysts had put out notes in recent days saying they believe the bad news is sort of baked in, so anything that target is able to put forward that looks positive could be a positive catalyst for the stock which looks like could happen here i remember the forward looking guidance not great >> i was looking at that you've got the tough comps from the crazy pandemic. >> we have the chart where we have the comparable sales and you can sort of see this very

clear spike up, and in the last two quarters we've seen negative comps for target it had been many, many quarters since we had seen a negative or even a flat comp and the normalization coming down, and then, of course, when you see the negative number, we have not seen that for quite some time, going back to 2016 or so. >> the big number should roll off and you'll have positive numbers. it looks bad. >> it does and they have digital we have not seen that with target like we have walmart. >> walmart is back up 1% courtney, thank you. still eeking out a gain. let's talk target chips and much

more sylvia, as we had said, positioning in the stock, expectations were very, very low. what do you make initially for nr this quarter of target? >> good morning. i think 210 is agreat number they exceeded the very low expectations target came out in august and sort of set a very low bar themselves on what they expect into the future. it looks like they beat there. the price of oil has gone down a little bit perhaps there's been an ease and that led to additional spending for target they have good tail winds coming for it, november, december we're going into the holiday subpoena here, so they've prot goble another good one i don't know about the conversation about locking things up. for me, 99% of the time i leave

if i have to wait a couple of minutes. they have to weigh out the theft issue and convenience issue. longer term, consumer has wages and it looks like they're still spending them. >> we have a data point that sends things off to the races. a soft landing is all but ensured. the spread there is significant simply because wall meat has consumers. in a soft landing environmental under that scenario, is that a better target environmental than walmart? >> it probably is a better target vitamin y environmental. you're talking liquidity, cash, and the prices of oil are going down and there's's of inflation with the price of food and things like this i think discretionary spending and sort of their willingness to

spend goes back up and perhaps you get a little bit of a tail wind with the target it sort of all depends we're worried about what they do in the background. having a couple of good reads does not make policy for the fed as we know we have to keep an eye in the coming months, but i think it's certainly a good sign to see that cpi number and the 10-year and things like this. >> i want to ask you about chip stocks a really, really strong day, strom year for semi-stocks overall. i know you've been bullish on amd. michael burry also talked about it talk about it. >> i love chip stocks.

machine learning, all ofthese kinds of innovations are the next super cycle of technology in the next five years or so it's tangibles i think these things are actually happening it's less hype, a little more action now i like amd i think -- nvidia talked about it they own 90% of it they have grown into soaking up some of the percentage of nvidia revenues are expected to go 9% gaming is starting to pick up a little bit again xboxes, again, they're sitting in things like electric vehicles it's a turnaround story. they've had this earnings read there. futures remain i think if you're thinking of

holding this for another five years or so, this is going to pay off. >> sylvia, great to speak with you. >> thank you have a great day. coming up, china in focus as president biden prepares for his meeting day with president xi. how things -- tides have turned a little bit you wouldn't really say hat in hand for president xi, but certainly they seem to be in a better position as a country at this point details after the break. later we're going to talk to former boston fed president for his take on the economy, inflation, and much more a reminder you can get the best of "squawk box" on our daily podcast. obviously that would be the three-hour podcast follow "squawk box" on your favorite podcast and we'll be next jooict

♪ (captivating music) ♪ (♪♪) the first law of thermodynamics states that energy cannot be created or destroyed.

(♪♪) but it can be passed on to the next generation. (♪♪)

. welcome back adding to yesterday's gains, big gains. nasdaq up almost 100 and dow adding 100 and s&p adding 17 premarket. shares of retail target continue to rip higher, although, the long-term chart is probably better to look at. $180 stock not long ago. go back further.

it was once a $250 stock. >> like levels from the summer. >> yeah. it's less than analysts had expected that's sort of the story things are climbing less than expected but i'm sure shareholders are happy with the 12% gain. meantime president biden is going to be hosting a bilateral meeting with chinese president xi jinping today treasury secretary janet yellen will be participating as well. later president biden and the first lady will host a welcome reception for apec leaders i don't know if you saw the great little picture of -- there's secretary yellen. >> oh, greeting -- yes. >> i think we're going to show it maybe check it out it happened yesterday before the meeting at the airport i don't know if this this is the same thing secretary janet yellen stopping at in-n-out burger

there she is she ordered a cheeseburger and fries with onions, so not the animal -- what's it called. >> the four-patty. >> with all the stuff on it. >> you've got in-n-out burger. >> that's what it's got going for it. >> tommy's burgers are good. they've got chili on it. >> a lot of good things are happening in the state of california. >> in-n-out, it's a good burger dude. >> it is. >> have you seen that movie? >> i have. a long time ago. >> i have seen that movie. coming up, netflix making a push into live sports and what that means and cord cutting. you canwatch us any time on th

cnbc app at pgim, finding opportunity in fixed income today, helps secure tomorrow. our time-tested fixed income suite, backed by over 145 years of risk experience, helps investors meet their goals.

pgim investments. shaping tomorrow today. why choose a sleep number smart bed? because no two people sleep the same. only sleep number smart beds let you each choose your individual firmness and comfort. your sleep number settings. it's so smart, it actively cools and warms up to 13 degrees on either side for your ideal sleep temperature, and effortlessly responds to both of you. for your best sleep, night after night. and now, save 50% on the sleep number limited edition smart bed, plus special financing. shop for a limited time and sleep next level. only at sleep number. (swords clashing) -had enough? -no... arthritis. here. aspercreme arthritis. full prescription-strength? reduces inflammation? thank the gods. don't thank them too soon. kick pain in the aspercreme. the first time you made a sale online with godaddy was also the first time you heard of a town named dinosaur, colorado. we just got an order from dinosaur, colorado. start an easy to build, powerful website for free with a partner that always puts you first.

start for free at godaddy.com

welcome back to "squawk box" this morning netflix making its debut on live sports yesterday with the netflix cup featuring formula one race car drivers and pga tour golfers competing in a golf match there are reports netflix expressed interest in securing rights for the nba's in season tournament joining us now is tom rogers, newsweek editor at large and executive chairman of orbit gaming and entertainment, also the former nbc cable president and cnbc contributor good morning, tom. we keep talking about live sports, the traditional live

sports, meaning, you know, gaining access to the nba and the like, and then there are these types of efforts where they're effectively creating their own live sporting events with their own brands and things which way does this all go long-term? >> well, i'm not sure that netflix cup would qualify as sports i think it is more reality entertainment where you're using sports celebrities for it. it was a combination of golf and racing golf carts and ended up with the netflix cup being presented, and the winner dropping the cup and it breaking, all part of the chaos of reality entertainment that i think they put out netflix doesn't need sports rights in the traditional sense you were describing. sports rights give you distribution, they give you audience netflix has plenty of

distribution, plenty of audience i guess an argument could be made it is nascent advertising business might benefit from live sports, but the company has pretty much said that its business model is not one about renting sports particularly on a domestic only basis. so, maybe they do something very limited with the nba, like the in season tournament you were talking about, but it is the other players who are really focused on sports, some of which who need it really badly. >> let's talk about who needs it really badly i'm imagining you're going to put on that list warner media, right, they had the nba for quite some time. you have espn and disney i don't know where you think that sits. comcast, parent company of nbc who else >> well, those -- two of those three, the first two i think need it very badly for different reasons. i don't think espn can continue to have sports primacy and make

good on iger's ambition to have a sports streaming service that is the leader in sports if they don't get the nba. i think if they don't get the nba, i think the notion of a dedicated espn streaming service is going to be much more difficult to pull off. i would think they would collapse it into disney plus, which may not be a bad thing for disney, even though that's not the stated objective >> are you of the view -- let me ask you this, tom. one of the things that bob iger has been very open about is he would love to find a partnership, he talked about technology partners, also talked about distribution partners and content partners, content partners being like the nba. would it benefit a league like the nba to effectively have an equity stake in espn or some kind of discounted license deal? i imagine that's how it would have to be structured. is that better for the nba than

taking cash up-front or for the nba trying to do its own dtc product? >> well, i think all the sports leagues will have some form of their own dtc product. i think the sports rights business from the league's point of view is about cash. and having a minority stake in espn where the future of espn, both as a cable service and as a streaming service are somewhat questionable given the kind of perfect auction dynamics that i think the nba will see with three traditional media companies you mentioned, not to mention amazon and alphabet and potentially others showing up, i really think cash is what will speak here i think the other part of disney that is hard to contemplate,

given how much they need the nba is the talk about potentially selling abc. one of the issues warner clearly has as a sports rights bidder, it does not have a broadcast network and reach really matters to the leagues not having a broadcast network is a handicap. disney trying to sell abc and then putting together some kind of commercial arrangement that would give it rights for abc distribution, hard to imagine. i think warner badly needs it because their affiliate fees are so high to renewal of major sports rights, highly leveraged, they can't go that far in terms of bidding, some suggest they're for a smaller package but the question is how small a package before those affiliate fees are compromised. >> okay, so, you're david zaslav, what do you do he's trying to pay down debt, as you know >> right >> the issues you just raised, if you're him, do you -- what you're suggesting in the auction

dynamic is everybody who is paying for these rights is effectively overpaying for the rights so the question is overpaying for the rights a worthy endeavor if they protect some kind of other revenue? >> well, i think in the -- given how highly leveraged warner is and given how much their business is tied to the cable satellite side of the world, they can't afford to lose the nba entirely and have their affiliate fees ratcheted down. i think that makes their deleveraging plan which has already been called into question because of future advertising murkiness that it would really put at risk their entire deleveraging strategy so i think they need it, but they probably want a smaller package where they can pay less. and that probably means they favor bigger streaming -- >> we got to run, but one last

final question fascinating piece in "the new york times" this morning about david zaslav and warner bros and in it, barry diller says this company could one day get bought and, by the way, says saudi arabia could buy the company, says don't laugh. do you think the u.s. government would allow that >> well, you know it would get extreme scrutiny in particular because cnn is in there. i think that it is one that would face an immense amount of political firestorm and therefore probably not the chosen path if you want to get a transaction. >> sell it to zucker first >> i'm not so sure about that. but that's -- >> he still wants it, i think. >> tom, we got to run. it is always great to get your insight on all of these things and i'm sure we'll talk to you again very, very soon. thanks >> thanks for having me.

coming up, more economic data on the way after yesterday's soft consumer price data sparked a massive rally on wall street. later this morning, we'll get the latest producer price and retail sales numbers we'll tell you what to expect next nd more businesses 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.

( ♪♪ ) we're still going for that nice catch. we're still going for that sweet shot. and with higher stroke risk from afib not caused by a heart valve problem, we're going for a better treatment than warfarin. eliquis. eliquis reduces stroke risk. and has less major bleeding. over 97% of eliquis patients did not experience a stroke. don't stop taking eliquis without talking to your doctor as this may increase your risk of stroke. eliquis can cause serious and in rare cases fatal bleeding.

don't take eliquis if you have an artificial heart valve or abnormal bleeding. while taking, you may bruise more easily or take longer for bleeding to stop. get help right away for unexpected bleeding, or unusual bruising. it may increase your bleeding risk if you take certain medicines. tell your doctor about all planned medical or dental procedures. the number one cardiologist-prescribed blood thinner. we're going for it. ask your doctor about eliquis.

good morning futures higher after the s&p 500 and nasdaq post their best day since april. with we're going to take a look at what's moving this morning ahead of today's inflation data. plus, the house passing a bill to avoid a government shutdown presidential candidate nikki haley will join us to discuss that and so much more. and target's quarterly results are out and the stock, it is soaring right now. we'll take a closer look at the retail sector as we get ready for a wave of results as the second hour of "squawk box" begins right now good morning and welcome back to "squawk box" on cnbc we're live at the nasdaq market site in times square i'm melissa lee with joe kernen and andrew ross sorkin becky is off today let's take a check on u.s. equity futures and how we're setting up

we look to extend the gains. the big gains we saw in the back of yesterday, softer than expected cpi data. the s&p looking at 18.5. the dow up by 129. the nasdaq up by 101 we should note that russell yesterday, huge winner in yesterday's session, up 5% we'll see if they continue the gains today. treasury market, big piece of the rally we saw yesterday ten-year yield went down below 4.5% still there. 4.69% right now. the two-year below 5%, well below 5%, 4.850%. let's get to mike santoli to look at this morning's premarket movers, which should be really easy for mike to do since you've already done them all on anchoring "worldwide exchange" earlier. and then can you also, mike, tell us what the word of the day is at the end of your report >> at the end of the report, yeah it is not the usual heavy lift -- >> keep people tuned in.

>> run through a few of the hot stocks here. one of them i did not get to in the 5:00 a.m. hour, target as you've been reporting, did report numbers after 6:00 a.m. soaring, up almost 15% in the premarket on those numbers a handy beat on the bottom line. 2.10 a share 1.40 the estimate. i looked at the beginning of the third quarter, the estimate was 205, cut down to 147, they hurdled what was expected at the beginning of the quarter and you see the stock responding back at the end of june, stock at 132 wanted to take a longer term view of target as well going back to just before the pandemic it has been a big round trip around 120 as covid hit. surged through the stay at home period, of course, the omni channel benefits that that target brought and we unwound it all and it has that somewhat discounted valuation let's get to jd.com. excuse me. tonight, 6:00 p.m., brian

cornell, ceo of target, jim has him. you'll want to see that for sure let's get to jd.com. also, beating on the bottom line as they reported results little bit of a beat on revenue as well. reinforced the idea that the chinese consumer has perhaps, you know, kind of seen the worst of those trends. up almost 5% here also, alibaba up in sympathy as well in the early trading. american express, barclays, initiating coverage of the consumer finance sector. they like american express within that group. essentially saying that the valuation which is below the longer term average builds in a more pessimistic view of the american express cardholder, the consumer, than they believe is warranted. stock not really doing a whole lot of response to that, but they do say that there is upside relative to the valuation. and, joe, the word of the day today was selective. >> i know. we just had a little discussion, we were listening very intently

to what you were saying, but melissa is absolutely right, we would rather have mike santoli's word of the day than you ask somebody else for their word of the day because you probably know much more than -- yeah. that was a really nice -- that was a really nice compliment from melissa and i agree. >> i'll do it again. i'll deliver the word of the day. >> you deliver that thing. don't even ask don't even ask. >> that's a tease, though. how many people are going to tune in tomorrow to see mike's word of the day? >> watch it while i'm in makeup, which i'll be there, because it is from 5:00 to 6:00 a.m. and still doesn't really -- mike, thank you. >> all right. >> see you later. >> that's not true i'm in for five minutes, right >> makeup? >> the chair less three minutes. >> just for the right side of your hair. >> you're in for -- you're in for -- >> they glue it down you're in for, like, three seconds. >> you go in, you do your makeup right here, it is right there on

the desk. >> powder. >> like this, everybody. >> you're guildi inggilding the anyway they're saying go. why? why? why? >> ratings gold here. >> you have to watch me do it. >> for more on the markets, let's bring in catherine rooney. great to have you with us. >> i'll become a meme. >> catherine, great to have you. what did you make of the rally yesterday? do you believe that this rally has got legs the ten-year being below 4.5 gives a lot of runway for stocks. >> unless the bond yield drop is because of a rollover in u.s. economies. what are we really rooting for here the u.s. economy gaining traction and remaining strong in which case inflation could resurge and the fed has to hike in the future, or economic rollover and consumption contraction in which case the fed would be cutting that would not be good for equity risk premiums at this point, i think the

market has got ahead of themselves somewhat yesterday, melissa, and rallied significantly in the playbook being the fed is on hold, the fed is going to cut, buy risk with everything you can. >> do you think that soft landing is on -- is that the foregone conclusion? that's what the markets told us yesterday. that's a consensus, if you look at consensus 12 months ago, the majority on wall street thought there was going to be a recession in the next 12 months and now it is virtually zero >> right yeah, i think the markets are pricing in soft landing, which is historically an improbable event, historically unlikely next year's s&p earnings growth of 12% is probably optimistic, especially given the triple whammy of margin pressure. i think that's going to come upon corporations next year. how can they continue to expand margins when you have high energy inputs, high labor costs still out there and high real

interest rates and nominal growth rates are probably not going to be at the 5.5% that are basically baked into that 12% earnings growth. so i suspect there is going to be earnings revisions to the downside and margin pressure will likely cause this job hoarding that we have seen post pandemic to go away and we could see additional job shedding. my basic point and i kind of agree with jamie dimon yesterday, we talked about risk management, i think it is time to engage in countercyclical portfolio policy, protecting yourselves for the possibility of a stagflationary scenario or recessionary scenario. >> what sectors would that mean? healthcare overall you had, you know, a couple of winners within the healthcare sector and the rest of the health -- if you look at novo and lily, they're the big winners at the expense of a merck, pfizer, you name it how do you think of that countercyclical, you know, playbook >> yeah, well, fixed income is going to continue to do well

versus equities next year and then within the equities space, melissa, utilities is a bond proxy. i suspect that's going to be one of the better performers next year staples, healthcare you mentioned, insurance i think are the plays for next year. and i would suggest at least buying puts or hedging with options on the technology portion of a portfolio for next year especially given the headwinds that i think are currently as you mentioned really not priced in at the moment >> yeah. kathryn, great to see you. thank you. >> thank you, melissa. coming up, how the grinch is stealing wall street bonuses and later, presidential candidate and u.s. former ambassador to the u.n. nikki haley is going to be our special guest at the table you do not want to miss that conversaon awbo cinright back >> announcer: this cnbc program is sponsored by baird.

visit bairddifference.com.

c'mon, we're right there. c'mon baby. it's the only we need. go, go, go, go! ah! touchdown baby! -touchdown! are your neighbors watching the same game? yeah, my 5g home internet delays the game a bit. but you get used to it. try these. they're noise cancelling earmuffs. i stole them from an airport. it's always something with you, man. great! solid! -greek salad? exactly! don't delay the game with verizon or t-mobile 5g home internet. catch it on the xfinity 10g network. welcome back to "squawk box. the market rally won't help boost wall street bonuses this year with that story, robert frank joins with us a look at the continued decline of wall street bonuses and what that means for the economy in new york and around the country. >> bonuses on wall street expected to be flat or slightly down again this year a new report from johnson and associates, the industry

consulting firm, found that investment banking will see the biggest hit with deal advisers being down as much as 25% with their bonuses. sales trading at asset management could see drops of up to 10% hedge funds and private equity, they could fair a little better with bonuses flat from last year wealth management is a rare bright spot, up 5% last year, bonuses were down 26% with the average for all financial service firms at $176,000 less money from wall street means a lot less tax revenue the securities industry accounts for 22% of all tax revenue in new york state last year's drop cost the state over $450 million in lost revenue. bonuses also key source of liquidity for real estate. brokers telling me their banker clients are putting their real estate plans on hold until they get their numbers the high end of the market of real estate has been doing very well it is all cash so that's a lot less cash for

that market as well. >> do we have any data yet on the revenue loss from bonuses because of flight of people moving to miami, you know from the financials, or elsewhere, out of new york city, out of new york state >> we know new york has lost about half a million people during the pandemic and after. many of those probably bankers, ken griffin said miami will be the new financial center >> that was my follow-up. >> look, bonuses by themselves are not going to force people to leave and they may go to a different industry, but i think, you know, you're making less, new york is costing less for rents, for apartments, prices are just going up, it is more attractive to be in miami. >> what did you make of ken griffin's comments about the idea that miami would -- he thinks maybe 50 years from now the financial hub of the world at the same time, by the way, in fairness, he's building a tower here in new york >> he is he's got a huge presence here in new york but, look, he's from florida

he has become very quickly the miami booster. he's buying, you know, a lot of both personal real estate there, over half a billion dollars of personal real estate between palm beach and miami, and he's buying a lot of commercial real estate for himself so he's got a big investment there. and he's been boosting miami and saying miami is the future for a long time. >> smart, about ten miles inland >> that's going to save him? >> no, where the coast is going to be. >> yeah. beachfront. >> i don't know what he's doing at miami beach i thought he was building a billion dollar home. >> that's for his mom in palm beach. >> is there such a thing as a billion dollar home? >> he spent a half billion on the land in palm beach for the house. he hasn't built the house yet. >> half billion? >> just on the land. >> roomy. >> and $250 million just for the land on star island where he's also yet to build a house. >> that's a lot of small moves in stocks. >> architect's best friend right

now, florida >> robert frank, thank you, sir. >> thank you >> a lot of naked shorts coming up, mercedes-benz opening up its first ev dedicated chargingkki haley wil guest to talk about the president's meeting with chinas' president xi jinping in topography, the process of adjusting the spacing between characters is known as what? the answer when "squawk box" returns. e duck goes the distance! alright, you about ready to get out? what's this? a hospital bill?! for a thousand bucks?! gaaaap! did this goat just say 'gap'? he's talking about expenses health insurance doesn't cover. but with aflac, you can get money to help close that gap. aflac, huh? -aflac! -ahhhh! okay! oh! duck - 1, goat - 0. get help with expenses health insurance doesn't cover at aflac.com

-you want to race? -for real? power e*trade's easy-to-use tools, like dynamic charting and risk-reward analysis help make trading feel effortless. and its customizable scans with social sentiment help you find and unlock opportunities in the market. e*trade from morgan stanley. with powerful, easy-to-use tools, power e*trade makes complex trading easier. react to fast-moving markets with dynamic charting and a futures ladder that lets you place, flatten, or reverse orders so you won't miss an opportunity. e*trade from morgan stanley fresh, warm hot dogs! when i'm not selling hot dogs, i invest in a fund that advances innovations like robotics. fresh, warm hot dogs, straight out of my torso! one for you, one for you. oh, you're a messy one. cool, right? so cool. anyone can become an agent of innovation with invesco qqq, a fund that gives you access to nasdaq-100 innovations. hot dogs! fresh, warm hot dogs! before investing carefully read and consider

fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com. what is cirkul? cirkul is the fuel you need to take flight. cirkul is the energy that gets you to the next level. cirkul is what you hope for when life tosses lemons your way. cirkul. it's your water, your way. mlb chooses t-mobile for business for 5g solutions... ...to not only enhance the fan experience, but to advance how the game is played. now's the time to see what america's

largest 5g network can do for your business. to today's aflac trivia question in typography, the process of adjusting the spacing between characters is known as what? the answer, kerning. >> no way. they didn't ask me. welcome back mercedes-benz opening its first dedicated ev charging hub in north america. let's get to phil lebeau now with a special guest hey, phil. >> hey, joe. we're in atlanta here at the mercedes-benz headquarters dmitri solakis, the first

dedicated mercedes charging station, a charging hub. why open a dedicated network a lot of people would sit there and say, there is enough chargers out there, why go dedicated? >> we're here at the mercedes-benz headquarters in atlanta. and this is truly the first mercedes-benz high charging power network for north america. why? why network? because we are convinced the future is electric mobility and electric vehicles and for that we're building for our customers convenience. we're offering them mercedes-benz branded charging network, high power, fast charging, but also at the convenience of charging lounge as we call it where the customers can sit while they wait for the vehicle to get charged. >> you've been pushing electric cars for the last couple of years here in the united states. longer than that actually. do you hear back from customers that they're frustrated when it comes to charging their vehicles outside of their homes on the network, whatever public station

they may want to try to recharge it >> the customers want to go electric, but they have hesitations, they have worries the worry of range, how far can a vehicle go, and how fast can my vehicle charge or where can i charge my vehicle? we take that into account and try to offer convenience as i said before, meaning the vehicle can drive itself not autonomously, but through the navigation system to the next charging system, can reserve the space, can reserve the time for charging, and 15, 20 minutes you can get enough juice on the vehicle to run your trip. >> 400 of these in the u.s. by the end of the decade. how many of these are going to initially be in california, where your sales are growing extremely fast and the market is red hot right now for all electric vehicles? >> the planning is to go where the customer drives our vehicles most so we know we sell our vehicles, we know where our vehicles are driven by our customers and we

try to plant these locations, charging stations, close to the use the customers are having california, florida, texas, georgia obviously as states will go fast and, you know, have announced collaboration with places where our customers use it in their travels. >> do you find the questions about evs now, there is a lot of questions about the growth slowing down, still growing, maybe not growing as quickly as it was before, is this what you would expect at this stage of the ev market developing or you to look at this and say, it is a little bit of a bump, but things will continue to accelerate? >> we follow customer demands and we're offering electric vehicles, we're offering plug-in hybrids and, of course, our other vehicles i don't say the speed of adoption has slowed down, but it is not as initially as planned one thing is clear, vehicle

adoption is not a sprint, it is a marathon and we're at the beginning of the long, long run. offering all solutions, customer can choose, but what is offering convenience, offering to the customer charging stations, connectivity of the vehicle and making his life as much as possible easy while owning and driving an electric vehicle. >> quick answer, give me a ballpark estimate when we start to see the price of electric vehicles here in the u.s. come down is it later this decade, after 2030 >> i think this is very much based on technology, battery, the components of the products and that will come later in the decade, but not yet. >> guys, you would love this, dedicated charging station like this, you can go inside and get yourself a cup of coffee this is what they believe is key to getting people into electric mercedes back to you. >> cup of coffee years ago. waffles. waffle house charging stations you can give that --

>> you know what, but, joe, they're going to be at buckies in the southeast >> with the -- the beaver logo i like buckies that's okay. that's a start >> that's where they're going. >> so many waffle houses so many. that will revolutionize the ev industry waffle houses and taco bells for lunch. thank you, phil lebeau. still to come, republican presidential candidate nikki haley joins us next for an interview that you don't want to miss plus, target reporting this morning. we'll dig deeper into the numbers, retail earnings heat up before we go to break, a check on the markets, stay tuned you're watching "squawk box" and this is cnbc experience the art of high pressure brewed coffee and espresso with the l'or barista system. enjoy richer, bolder flavors complete with velvet smooth crema.

now brewing peet's coffee.

president biden set to meet with chinese president xi jinping later today. our next guest says that the president had to beg for the meeting and china is not worried about what the u.s. is doing republican presidential candidate governor ambassador nikki haley joins us this morning, former ambassador to the u.n., and as i said, former

governor of south carolina you were here not too long ago on set so, each point in time gets more interesting to have you on we appreciate you being on set to talk about all these things. >> it is always fun to hang out with you guys. so, you know, look, we have a job to do. we're keeping our head down, we're staying disciplined, but the momentum is real and we love the fact that, yes, what i'm saying is connecting with people, but i think it is because people want to see america get back on track. they want to see america strong and proud again. and it is going to take a lot of work this isn't going to be an easy eight years, this is going to be a lot of changes, a lot of shifts, a lot of righting the ship but i think it can be done and i think the american people see it can be done. >> eight years >> yeah. >> i heard that. >> i told my wife i wouldn't do this she has an addendum to your marget thatcher quote, if you want something said, ask a man, if you want something done, ask

a woman or ask a woman to tell the man to do something in my case is that -- can we add that addendum or that still gives a man too much >> the interesting thing, when i was younger, you'll appreciate this, when i was younger, i never saw women leaders. i just didn't see them in my town so i would go -- i remember in elementary school, i would go to the library and look for books on female leaders and the only books they had were of the first ladies to presidents and i would read them and what i took away was how muchof a partner they were to every president. how much they really pushed them to do that >> you're going to flip that script it is going to be the first husband is going to help you out. >> i think it is time. i think it is time i think america is ready i think that the world is on fire i think that there are a lot of things domest aically we have t do you have a war in europe, you have a war in the middle east, you have china on the march. we got to get this right. >> you appointed tim scott. >> i did, yes. >> he's gone

but ambassador, you add tim scott's numbers in, add a couple other people's numbers in, the math still isn't anywhere near where it needs to be and i -- we're all wondering what seismic shift would need to happen for this to become a reality. >> look, you all said this to me a few months ago, you're, like, how are you going to break from the pack, we break from the pack, how you going to do in the debates, we do well in the debates. we have one more fellow we got to catch up to and we'll do that but the way that happens is as you see this field getting smaller, the 60-day window, historically, look, the 60 days before iowa, things shift. >> you speak speaker johnson on yesterday, this is what he said to us yesterday. i don't know if anyone asked him before, but this is what he said >> i have endorsed him wholeheartedly look, i was one of the closest allies that president trump had in congress. he had a phenomenal first term

those first two years, as you all know, we brought about the greatest economic numbers in the history of the world, not just the country, because his policies worked and i'm all in for president trump. i know -- i expect he'll be our nominee, yeah, and he's going to win it and we have to make biden a one-term president >> just to drill down on that, then we talked about character and we talked about his actions after losing the election. and, you know, these are all good points. my question to the speaker was, if he knew he lost, and he still, you know, the reporting this week was that he said i'm staying, he told that to sidney powell and some other people, attorneys in georgia, i'm staying regardless of what happens, if he knew he lost and he says i'm staying, that would be disqualifying that would be -- i don't know what you call that but speaker johnson was able to say, i can do it because i believe in his heart that he thought he had won and he had been cheated do you think his actions were

disqualifying? >> i think that people have vetted this enough i think at the end of the day only donald trump knows what he thought or what happened, but i think what we have to look at is, you know, i think a lot of his policies were good we all benefited from that i do think he was the right president at the right time. i don't think he's the right president going forward. why? think about it chaos follows him. everywhere he goes, chaos follows him. and in a time where we need to start getting our act together, do we really want to go that route? i don't think we do. i don't think the american people do. and i think when it comes down to it, the one thing that republicans care about, they don't want to see a president kamala harris. and, you know, everybody was showing the polls of how, you know, trump beats biden in the swing states by 3 or 4 points. i was in that exact same poll. i beat biden by 10 to 13 points. so this isn't about the presidency this is how do we win the governorships up and down, how do we win the house races, the

senate races and really shift the country back to where it needs to be. >> i think it becomes a nominee, do you support him >> i'll support the republican nominee. i think that's important that we support the republican nominee because i think anybody is better than kamala harris at this point >> interesting way to put it let me ask you this, if in fact he becomes a nominee and he calls you up and says i want you to be my vice president, would you do that? >> i don't play for second i've never played for second i'm not going to start now. >> would you accept -- would you take that position >> i'm not playing for second. i'm not going to do it i am running because this country is in trouble. i'm running because we have an open border and we just saw 240,000 people cross that border, another dozen people on the terrorist watch list it only takes one. i'm doing this because our kids are reading 29% of our eighth graders in this country are proficient in reading. i'm doing this because our economy and debt is out of control. and families are hurting i am doing this because i don't trust -- >> the reason i ask you the

question is you have been, i think, tell me if you think this is fair, you have actually had a very positive message in your campaign, you have not actually been super critical, critical to some extent of former president trump, but not the way, for example, chris christie has, you haven't really sort of taken off some of thhis character issues, and the reason i ask you whether you would accept being his vice president is because i just wonder whether that is a calculated view about -- >> she is not playing for second she doesn't have to answer you. >> i understand. i understand it may be a calculated view because there is obviously a population that is -- he clearly is -- >> she is saying she will support the republican nominee >> it is a sense of every time somebody says she's playing for vice president, no, i'm not. i'm playing to be -- i'm fighting to be president >> i want to talk about doxxing

anonymous people i also want to talk about i don't think you or your campaign have talked about jamie dimon, there is an access report. are you phone friends a lot, do you talk a lot he gets -- if he says i like nikki haley and she would be great, that goes a long way, along with drunkenmiller and ken griffin. >> i appreciate it we had one phone call. jamie called and, you know, we talked about the debt, we talked about the economy, and how, you know, the -- >> he's impressed with your knowledge about the economy and markets and jamie dimon is probably the greatest risk manager of our -- >> listen, i love, you know, the idea that jamie dimon and stan drunkenmiller would be supportive we'll take it. but i also think these are men that see what is happening they see that in a couple of years our interest expense is going to be higher than our national defense budget. they see what is in the future and i think that, you know, they know that i'm serious, even if it means talking about the hard

truths of what we're going to have to do to fix it, i think they see that. i appreciate that they see that. look, we're going to need a lot of people to come together and figure out where we go -- >> on the hard truths, one of the things that stan drunkenmiller and jamie and others talked about is the need to reform entitlements that's a polite way of saying cutting entitlements in a big and meaningful way are you on board with cutting entitlements in a big and meaningful way >> social security goes bankrupt in ten years medicare in eight. anyone that says they're not going to take on entitlement reform means they're going to go in and be president and leave the country bankrupt you can't do that. yes, we have to do entitlement reform but that doesn't mean you touch anyone that is in the system we should keep our promises, america should always keep our promises but for everybody coming into the system like my kids in their 20s, you change it, you say we're going to raise the retirement age to reflect life expectancy we're no longer going to do cost of living increases, we're going to do increases based on inflation. we're going to limit the benefits on the wealthy and we're going to expand medicare

advantage plans so we have more competition. we have to start looking at a common sense way to do it without hurting people, but our kids know they're not going to get it otherwise. >> can you make the math work if you just focus on the generation that is walking into social security for -- if you're 18 now, i think you have to probably unfortunately approach folks like me and others who might be in their 40s or 30s already -- >> it is not true. that's what everybody wants to think. that's what they want to do is pigeon hole you into that. look, we did pension reform in south carolina, we changed it for people coming in but you -- >> i'm not saying you shouldn't do i'm saying you might have do it. >> we have to be realistic we have got to speak the hard truth. but there are so many other things we need to be doing as well you look at the fact right now 70% of the people that work in the federal government are working from home. 75% of our office space in our agencies is empty. and taxpayers are paying for

that there are so many things in our economy that we have to fix and there are so much in expenses we have to do, is entitlement reform one of them yes, but there is a whole line of other things we got to work on too. >> the other side of the ledger is revenues. when it comes to tax cuts, what sort of cuts are you supporting and does it go beyond? because the 2017 tax cuts for individuals will expire in 2025. the cuts you're proposing, is it on top of or to make those permanent? >> i think those tax cuts, we saw in real time how it helped people we're also seeing right now the rich are getting richer, the poor are getting poorer, and so what i want to do is cut the federal, gas and diesel tax. i want to cut taxes on middle america and collapse the brackets so it is simpler and we should make the small business, they didn't do it for small businesses let's make those permanent we need a president who is going to sell. when i was governor, we were number one on foreign direct

investment but i also sold our products out. we need to be selling american made products out of this country too as much as we want to make things in america. >> the question about the economy, and it goes to the inflation report that we heard yesterday, which is, you know, if you go back over the last year as you've been talking, a lot of -- the criticism of this administration has been in inflation critique it has been inflation is going up, up, up, up, this is terrible for the economy. and maybe he deserves the credit or the -- or the blame for inflation going up, we can debate that. as it comes down -- >> it is not coming down, though the rate of inflation is coming -- everything is still 15%. >> yes, you're not -- it is not reversing. >> another 3%. >> as inflation gets under control, let's say, do you get credit for that or do you think -- joe is going to put -- it is true -- the world thinks about everything in a very relative way, they don't think about it in any other way, but,

right, prices are not -- >> the damage is done. >> the prices are not going to go down, but then we should have a real debate about whether he was responsible for inflation the first time. >> i mean, i think first of all, i would love to blame biden for everything that has happened, but our republicans did that to us too the way they are spending is out of control and there is no accountability under the trump administration, they expanded -- increased the debt by 8% we have seen it expand -- the government grow 40% in the last four years there is a serious problem so i don't think biden alone gets the blame but i think the fact that inflation is coming down, no one is celebrating go to the grocery store, the gas station, look at insurance prices, look at mortgage rates, none of that is going well and if you have a child that goes and does something wrong, when they stop doing something wrong, you don't praise him for it he flushed cash into our economy. they allowed people to sit on the couch. we became unproductive

you still got 75% of the federal government working from home, and now we're looking at the fact that, yes, inflation has come down a little bit, ask your average american family the cost of things they have to have have gone way up. no one is feeling relief from this and we have got to get serious about what it is going to take to fix it. and eliminating student loans is not going to fix it. going and doing these green subsidies is not going to fix it >> a lot of regulation too we won't get into -- you could start there. >> that's another place where inflation can be an issue. >> is the history of the first amendment include the ability for anonymity because heads exploded this week when you said that people online, you get rid of the algorithms that maintains anonymity. >> social media has become a national security issue. so, when you look at it, first of all, i think social media companies need to show us their algorithms

be transparent to the american people how do you do what you do and show it to us. the second thing is, what i know, what anyone in intelligence and we knew this at the united nations and they have known for a while, russia, iran and china, north korea too, know that the cheapest form of warfare is to spread misinformation look at what happened with israel you want to know where all this pro hamas information is coming from it is coming from foreign actors that are sewing chaos and division i want freedom of speech for americans. i don't want freedom of speech for russia and hamas and that's what's happening right now the way you fix that is we need our social media companies to verify everybody so we can get all of those -- >> you're not saying people can't tweet. but that's bad enough because you see what it is doing to our kids and bullying and everything else. >> do i think life would be more civil if we were able to do that yes. it is the same reason why i think doxxing, like, you know,

you should stand by what you say. but, no, you can have anonymous -- i don't want anonymous american people having free speech. what i don't like is anonymous russians and chinese and iranians having free speech. >> how would the conversation be with president xi if you were to have that conversation at apec >> i would ask him why he's putting a military base off our shores in cuba i would ask him why he's stealing our intellectual property and not owning up to it i would ask him why he's buying so much u.s. soil and it is next to military installations. there are a lot of conversations we need to have. the problem is biden won, begged to go have the conversation by sending four cabinet directors there, they're going to have the conversation, what they're going to come out is an agreement on the environment. that is not what we need to be talking about. china is building up their military at record paces we better let them know we're on to us. i saw it at the united nations biden and yellen keep telling us

china is a good competitor when i was at the united nations, china never saw america as a competitor. they saw america as an enemy we better start looking at them the way they look at us. >> how much are you willing to risk with the china relationship particularly when it comes to u.s. corporations to have that conversation because those hard conversations could result in u.s. companies being retaliated against, not, you know, there won't be rule of law over there when it pertains to them. in markets that they want to be in, they want to participate in. >> this is a national security issue. you know, i'm not talking about t-shirts and lightbulbs. what i am talking about is our technology and anything that builds up their military, pharmaceuticals, those are the things we need to be looking at, and we need to do it in a strong way. i would go to china and i would stop selling them land and i would take back the land they already purchased. i would go and get them to stop, not just chinese, but all foreign money going into our universities we would make sure that they know that we're not going to

send them technology anymore we stop all normal trade relations until they stop murdering americans with fentanyl the way we need to do this is we need to focus on what they are doing. think about it, they are the premiere power when it comes to our military situation at our ports. they are in charge of all of the global supply chain. if they cut that off tomorrow, where does that leave american companies? we need to have that conversation with our companies and let them know, if china pulls the rug out from under you tomorrow, are you ready? and i think a lot of american companies aren't ready. >> related to that, nvidia's ceo and, you know, nvidia is now effectively shipping what might be described as throttled chips to china, meaning chips that are -- technically can go faster, but don't because of the rules we put in place. one of the things he said repeatedly is, look, if we don't send them these faster chips, it is only going to motivate them and incentivize them to create companies that are going to compete even better with the

nvidias of the world i'm not taking sides on this but i'm curious you think of how you balance those two ideas, one is if we send them these super fast chips, they're able to leapfrog us in other ways on one end. on the other end, these american companies either lose out in the immediate term or maybe longer term if china creates bigger and better competitors >> why do we want to help an enemy that wants to destroy us why would we want to do that i don't care how much money you can make off of it i don't care how many excuses you want to give the reality is, and this is the problem i had with the chips bill they did, they went and they incentivized these american companies to produce chips, but what did they do they didn't stop them from producing in china they lost the whole point of it. the goal is take that ability away from china so that they can't threaten us with it. take that ability away from china so that they don't win america needs to win we need to start focusing on what it takes for america to win and for our enemies to fall to

the way side >> ambassador, you said that is what is going to -- i guarantee you that's what we're going to get, some kind of toothless environmental -- because the paris agreement doesn't even quote china to the same standards as us on emissions and they're going to continue to build. >> the reason why i pulled us out of the paris climate agreement is not because we don't care about the agreement everybody cares about the environment. it is because we put so many regulations on our companies, our own administration did, you know what china's paris climate agreement was? we'll deal with it in ten years. i dealt with china before. ten years never comes. >> the president is going to declare victory. that's all he's going to get it is going to be nochbtne of t things you were talking about. it begs the question, two, three, four years from now, can president biden go toe to toe with world leaders do you think that that serves our country well for him to be chief executive for another four years with the state he's in

right now? do you have a comment on that? >> 75% of americans don't want a trump or biden rematch listen to america. they don't want to see a 78 and 82-year-old going into office. we need to make sure that we are showing a new generational leader that will take these countries head on and start making america strong. why would we go and put ourselves in that situation? why would we -- look at what is happening with biden now i actually think it is abusive what is happening. everybody -- the reason our enemies are as strong as they are right now is because they don't fear america they don't see us as strong. they know this is the weakest we have ever looked and the one thing that keeps me up at night is what happens between now and election day because they know if they ever wanted to do anything, this is the time to do it. >> ambassador, you got to go somewhere apparently they're telling me we got to go. that was a lot of time. >> it is always fun to be with you. thank you so much. thank you for having me. >> you're welcome. >> see, i'm not reason gngoi to

say what's coming up "squawk box" will be right back. can do more than help you reach your goals. wow... we can make this work. it can help you reach them with confidence. no wonder more than 9 out of 10 of our clients are likely to recommend us. ameriprise financial. advice worth talking about. (adventurous music) ♪ ♪ ♪ be ready for any market with a liquid etf. get in and out with dia.

why choose a sleep number smart bed? because no two people sleep the same. be ready for any market with a liquid etf. only sleep number smart beds let you each choose your individual firmness and comfort. your sleep number settings. it's so smart, it actively cools and warms up to 13 degrees on either side for your ideal sleep temperature,

and effortlessly responds to both of you. for your best sleep, night after night. and now, save 50% on the sleep number limited edition smart bed, plus special financing. shop for a limited time and sleep next level. only at sleep number.

progress means producing renewable fuels for trucks on the road today. we're partnering with farmers to develop these fuels using everything from plant by-products to cow manure. and then using those fuels to help lower the lifecycle carbon intensity of the transportation industry. driving the world forward today, while forging new roads to the future. that's energy in progress. with gold bond... you can age on your own terms. retinol overnight means... the smoothing benefits of retinol. are now for your whole body. plus, fast-working crepe corrector diminishes wrinkled skin in just two days. gold bond. champion your skin.

c'mon, we're right there. c'mon baby. diminishes wrinkled skin it's the only we need. go, go, go, go! ah! touchdown baby! -touchdown! are your neighbors watching the same game? yeah, my 5g home internet delays the game a bit. but you get used to it. try these. they're noise cancelling earmuffs. i stole them from an airport. it's always something with you, man. great! solid! -greek salad? exactly! don't delay the game with verizon or t-mobile 5g home internet. catch it on the xfinity 10g network.

(christmas music) ( ♪♪ ) weathertech gift cards have the power to wow everyone on your holiday list. offering a variety of american made products... weathertech! nice! like floorliners... cargo liner... seat protector... boot tray... cupfone... sink mat... pet feeding system...

anti-fatigue comfortmat...and more. order the weathertech gift card instantly for the perfect gift at weathertech.com. why choose a sleep number smart bed? because no two people sleep the same. order the weathertech gift card only sleep number smart beds let you each choose your individual firmness and comfort. your sleep number settings. it's so smart, it actively cools and warms up to 13 degrees on either side for your ideal sleep temperature, and effortlessly responds to both of you. for your best sleep, night after night. and now, save 50% on the sleep number limited edition smart bed, plus special financing. shop for a limited time and sleep next level. only at sleep number.

talk later. right here on cnbc, i should say, "we," the royal we but collective we, jim cramer will do it on "mad money" happening

later this evening back to the markets following the best day. how aggressive the move was, what itdid to break the s&p 50 out of a corrective phase. but, since july, you see a -- there it is. down trend in place since july, was decisively broken. a lot of things textbook here. soon as the season week began in august, 10% correction levels, bottomed late october. recover. yields peak, fed peak, economy growing. working together, saying maybe this is, gives headway into end of the year. a note, basically when the last fed rate hike happened

fed is done history says between the last hike and first cut market tends to be up 9%, 0 per -- 10%. down from that late july cut russell 2000, up more than 5% yesterday. has been kind of a thorn in the side of those who want to see a broader rally. this is a five-year chart showing how far back you had to go look at these levels part of the reason that we have been able to set aside weakness of the russell has been because apple and microsoft each are larger than the market cap of these 2,000 stocks still decent to see a catch-up move there with plenty more to prove in terms of small caps, i would to say. semis. a lot of times want to see semiconductors a as group doing well confirming a rally maybe modern day transports and industrials. depends how you measure it smh actually is at a new high as

of yesterday passing from almost two years ago. and the sector, you see lagging far behind why? smi is strong, nvidia, 20% waiting based on performance >> all right very good. good to see you, mike. see you, and everybody, back tomorrow morning 5:00 a.m it's 9:00, 10:00, 11:00 in the morning. setting alarms 5:00 a.m thanks. less than half an hour until october, cpi beloaned expectations raising questions whether we've soon the final rate hike from the fed joining us now, former federal reserve bank of boston president and ceo eric rosen bblume, great to have you with us. the markets reacted, assuming a soft landing are you ready to make that proclamation >> more than likely we are going to have a soft landing

the markets are responding to good inflation reports i wouldn't say, maybe a little ebullient. core cpi still a way to go before the meeting, unemployment report still pce inflation. about as good an outcome federal reserve to expect. falling inflation rate, unemployment a little below 4% and an economy that looks like it's growing, but not growing too fast. >> do you think we've seen the full effects of all the rate hikes? >> i don't think we've seen the full effects obviously, high interest rates are still affecting housing. high interest rates will affect people that want to bo borrow me for a car. those effects are probably continuing, but i do think that we're probably going to be

seeing a slower growth certainly than we saw third quarter and fourth quarter and possibly first quarter as well that's quite consistent with what i think the fed would like to see so if you want to get a soft landing, can't grow too fast so i think it's quite positive that we're going to get moderate growth that looks like we're seeing inflation going down, unemployment rate stabilized as a relatively low level. >> markets bears say we haven't felt the full effects of the rate hikes yet when those actually kick in, to an already slowing economy, that's what could tip us over into, you know, something worse than we're seeing now. can you talk to us why you think that that will not lead to a recession? even a small recession >> yeah. i think a slower economy rather than a recession's the most likely outcome, but i would say certainly downside risk. interest rates went up rapidly,

and you saw last march that number, difficulties long-term rates are quite high which means a lot of banks still have significant losses on their government and mbs holdings. banks in the seconder risks haven't flow the through completely international sector relatively weak china's not going rapidly. europe is also relatively weak, and we benefited from relatively lower oil prices in the last quarter. that may not continue going forward. so i think there's still a chance we'll see some negative surprises, but i don't think that's the base case. >> do you think the fed goes a little more dovish in its language and perhaps in its next statement and how do you think the fed chair thinks about what that might yield in terms of a further loosening of financial

conditions certainly saw yesterday's rally. we saw ten-year yield below 4.5. now off to the races for stocks. you're in a cycle here, sort of, where the cpi report comes in and financial conditions actually get looser and that could be concern for the fed. >> yeah. i think that it's probably tricky that they're pretty happy with the direction the economy's going but don't want to cause the economy to get to ebullient. i would say the statement from the last meeting was hawkish saying, extent of additional" that applies potentially even to more than one increase i think they'll probably moderate that language, but still highlight that additional tightening hasn't been taken off the table. something like whether additional firming is necessary. so i do think they'll make a mild change, but for the reasons you just highlighted, i think they're not going to want to signal that now is the time to

start talking about decreases in interest rates, even though the fed funds futures already has that incorporated. i would also highlight that the december meeting is a summary of economic projections meeting interesting to see how many governors and federal reserve presidents have unchanged interest rates for, through this year and part of next year it is quite possible that we're going to see the seven people that had no change in interest rates continuing to have moderate declines in interest rates through next year. i think the summary of economic projections with the december -- gives a pretty good idea of when easing is likely to occur, how much easing the committee's thinking about at this time. >> thank you so much for joining us appreciate it. eric rosengren. coming up ahead of this break, producer inflation data bringing it you. coming up in 20 minutes' te.im

and michael froman talking to about the u.s. hopes to achieve when president biden meets chinese president xi jinping later today. up next, chairman of the house ways and means committee on congress' rush to fund the government and a theory shining a light on anti-semitism on u.s. college campuses. stay tuneded you're watching "squawk box." trade brilliantly with schwab. at pgim, finding opportunity in fixed income today, helps secure tomorrow. our time-tested fixed income suite, backed by over 145 years of risk experience, helps investors meet their goals. pgim investments. shaping tomorrow today.

welcome back to "squawk box. a look at futures. looking to add yesterday's massive rally, s&p up 21

nasdaq 120 a big day yesterday. small cap up 5.5%. semiconductor, etf, new high kr regioning banking etf up 7% see what happens today. >> and government funding bill across the finish line speaker mike johnson expects to split it relying on democratic votes. bill goes to the senate expected to approve it. spending like this expected to return in the new year talk about that and important hearing that's going to happen with republican congress stacy smith chairman of ways and means committee, speak with him, i mentioned, about a hearing holding today on anti-semitism on college campuses. first the funding fight. good news is the government's going to stay open bad news we'll have this debate all over again, chairman >> unfortunately it's like

groundhogandrew. like you said, keeping government open. more than half house republicans in fact voted to have this extension in funding we unfortunately, since the last funding bill, wasted 22 days for a speaker fight. however, we did have three weeks to pass three additional appropriations bills the house of representatives passed more than 75% of all government funding united states senate has only passed 17% but we need to still continue to pass five more appropriations bill and send it to conference with the united states senate and helpfully get resolution to actually pass true appropriations bill by january and february. >> what do you think the chances are that's actually going to happen given the -- democrats not onboard with all of this. >> i think the democrats will be onboard for funding the government and going through regular order.

i hope they don't want these huge thousand-page omnibus spending bills that are usually pushed through right before christmas that no one reads. i hope that they want a transparent process of how we are spending money we should do all 12 appropriations bills, the house passed 7 five more to go. senate only passed three both chambers need to do their job and let's go to conference how our founding fathers set out appropriations, and then let's pass those bills. >> talk about this hearing that's going on today around anti-semitism. i know you'll be speaking to a number of affected students at universities, but paurt ort of t you're looking at taxpayer funded schools and how they reacted to some rhetoric or worse, dare i say, at some of these universities what do you want to happen >> you know, andrew, our focus is, of course, the tax cuts.

the ways and means committee has jurisdiction of the tax code what we will analyze, looking at, two different major areas. one, we're going to be looking at terror financing, and that is through 501c what we have documentation, that our tax code actually allows 501c to fund hamas and terrorism with tax advantage, tax advantage 501cs. we're also going to look at the tax-exempt status. of course, these large billion dollar endowments that universities have, and we need to make sure that these universities are following free speech not preferred speech that they're protecting young men and women regardless of their race, regardless of their religion unfortunately, we've seen some major college campuses that have not disavowed this anti-semitic harassment that has been going

on throughout this country on many college campuses. >> chairman, let me ask you this, and this is a complicated part, may be complicated for me personally i'm a jewish american and have been affected personally by the anti-semitism we're seeing in the country. that's one side of it. no question that hate speech is terrible and it's dangerous and some of the things happening on some of these campuses that are worse than just the speech itself, clearly should be held to account but then there's the other side of this, which goes to this idea of free speech so there's a view that other kinds of speech, considered woke speech, was allowed to go on in a way that shouldn't have. to me, there is this issue of, are they the same thing? are they not the same thing? if we're trying to protect marginalized groups one way or the other, should we be trying to protect all of them or is it, we want one speech but not the other? see where i'm going with this?

>> yeah. that's why i said free speech is extremely important. what we don't want is higher institutions, higher education institutions to have preferred speech like which speech is better than others whenever there is hate speech, they should disavow it, and they should protect their students. unfortunately we're going to have a student from the cornell testifying a jewish student about her experiences at cornell and how the university overlooked that. in fact, a cornell professor that said it was exhilarating to see what happened on october 7th. i'll tell you. yesterday, andrew, when i watched the video footage of bodycam footage of hamas terrorists that was a closed briefing here, the most atrocious thing i've ever seen and for a professor at cornell to say that it's exhilarating is so wrong. >> and also i should say, cornell alumnus, i am, and find

it very disturbing the question, do you think that professor, for example, should be suspended, fired, nothing what's the, what's the answer? >> you know, andrew, we have seen professors at other campuses get fired for much lesser activity. so i think cornell needs to clean their house. >> and the question is, can you imagine that -- do you imagine that your group effectively, that you oversee, is going to hold the university to account by effectively threatening this status aultimately is that what it's about and do you actually see ta happening? >> this hearing is to expose how tax-benefited institutions are not enforcing the rule of law. and not following free speech. that is what we're going to be highlighting today and then move forward to see where we need to act for moving on.

i will say that back in 2017 we saw a billion dollar endowment at these universities taxed 1.4% billions but they're only taxed 1.4%. a lot of my colleagues both in the house and senate want us to revisit that. >> what do you think about all the universities that have taken money from countries in the middle east? they set up shop in the uae, taken money from qatar, i mean, it's ---en rampant. american universities and what you're seeing in these kinds of universities today >> absolutely has impact paying attention to donors and it's scary to see that you see such a large amount of money coming in to these universities. >> should we prevent that kind of -- be preventing -- this goes to free borders, open trade, all those questions. you know would you take saudi money

i mean this is a fundamental question about where money comes from and then the influence it has. some people are saying that the donor class even in america, the universities shouldn't listen to donors but focused strictly on what they think is best for education and others say university has been selling influence and access to donors for the last 100 years and that's a surprise. donors raise their hand there's a problem. then there's a problem >> andrew, there's a lot of things we immediate to look at where money's coming from. something we're also doing is looking at 501cs in the house ways and means committee of where international money is coming in, into political campaigns, which is illegal, but, in fact, that's happening these are multiple items we have to look into what the solution is to that we're going to have to make sure that congress figures that out, but we know that these are problems that they need to be addressed. >> we appreciate your time and look forward to following the

hearing today and we'll talk again soon. >> thank you in the house all right. well, i know you're making a political comment about democrats that are saying things i think that that's -- >> what do you do? >> well, what's been done? right? you've seen what's done. called out censured you know, by the way, the comments that former president trump made, vermin comment, is, is a loaded word that a lot of people -- >> that i didn't know. >> should not be put in all of that, so -- same time -- great supporter of israel. the square all of these things happened. >> using something that i didn't even know was a long ago reference to that is it's totally different than just saying itoutright. genocide people are saying it outright!

>> goes to -- >> why would he you'd a loaded term >> all of that and people say, oh, well that's -- >> saying -- genocide to -- to the jews >> calling for -- >> call them into account. no question. >> exactly >> no question. coming up new inflation data after yesterday's cooler than expected cpi report. counsel on foreign relations michael froman helped us understand the meeting between united states president joe biden and chinese president xi jinping. that and more when "squawk box" returns.

rylee! from rylee's realty! hi! this listing sounds incredible. let's check it out. says here it gets plenty of light. and this must be the ocean view? of aruba? huh. this listing is misleading. well, when at&t says we give businesses get our best deal, on the iphone 15 pro made with titanium. we mean it. amazing. all my agents want it. says here...“inviting pool”. come on over! too inviting. only at&t gives businesses our best deals on any iphone. get iphone 15 pro on us.

(♪♪)

inflation data october producer prices next when "squawk box" returns. something amazing is happening here. data is bringing creativity to life. that's because cdw showed animation studios new ways to maximize their infrastructure, then built a flexible dell technologies data solution. more automation led to greater efficiency, which means creativity stays the star of the show. make amazing happen. dell technologies and cdw.

( ♪ ♪ ) ( ♪ ♪ ) ♪ (when the day that) ♪ ♪ (lies ahead of me) ♪ ♪ ( seems impossible to face) ♪ ♪ (a lovely day) ♪ ♪ (lovely day) ♪ ♪ (lovely day) ♪ ♪ (lovely day) ♪ a bank that knows your business grows your business. bmo.

october produce irprice data, retail sales, new manufactures numbers from new york state futures continue to be sharply high other. so we had retail sort of inflation yesterday. consumer prices. getting wholesale from rick santelli in cme chicago. numbers, please, rick? >> yes on the pgi month of october, expected up 0.1% down 0.5% that is a huge drop you have to go way back to april of 2020 to find a smaller month over month change. that one happened to were minus 1.2, and look at what is going on with regard to food and energy, unchanged also

significantly lower than up 0.3. energy and trade 0.1 half what we expected. you've over year, 1.3. huge drop from 2.2 1.3. that is the lowest level going back to -- ah -- july when it was 1.1 and if we look at 2.4, subtract food and energy, that's 0.3 less than we were looking for. you have to go back all the way to -- ooh. january of 2021 to find a lower number finally, x food energy and trade, 2.9 the only metric, the only metric that's tighter than expected expecting 2.8, and 2.8 in the rearview mirror. several 2 point 2 point 2 point 9s in july and august.

the other numbers are cooler than expected. empire shall we empire expected down 3 now 9.1 the best level going back to -- well, going back to 10.8 which was april. now retail sales for october down 0.1%. expecting a down number. that's less than the down 0.3% we were looking for, and made it up in the revision from up 7 cents to nine cents. autos are up of course, autos factored the equation a bit and stripping them out turns it up 0.2 to a positive 1 cent and revision from up 6 to up 8 cents and gas sales up 0.1 and following revision from 0.6 to 0.7 notable all revisions for september were positive

revisions. we see that interest rates aren't moving much as a matter of fact, we are now a couple of -- 30 seconds higher look at the futures. look what's going on, 448. we are 446 on the cash market. 487 on tuesday we're at 484 what's going on? well, i think that part of this is, yesterday we probably had a bit of an overreaction to cpi. understandable not only in the u.s., the uk a better than expected number. and get this, joe. they auctioned off 7 billion pounds of 20-year notes. they received 93 billion pounds worth of bids. 13 times more bids than the amount of securities for sale. that is unreal, and really does underscore that central banks were very punishing, the notion that they're done, well, it's a big party out there.

now, whether this holds true, we're still a bit of a wage mark 2% market and cpi numbers didn't garner a lot of market activity like cpi also pointing to, are we going to ever pay more attention again to supply or to determine premiums didn't go away we just changed our focus. trade the market ahead of you, but that certainly doesn't mean there aren't issues ahead. especially issues thinking how governments around the world are trying to control more of their economies. that should affect productivity, but at least for the moment, for the moment, inflation seems to have struck a cord not only with central bankers but also investors interpreting those, very positive signs. joe, back to you. >> all right rick very good. get to steve liesman, joining us now with more seeing kind of a muted reaction than yesterday from cpi makes it -- not surprising

seems numbers are surprising. some of those. >> i think so, joe i think we got a lot of reaction yesterday. i'm actually more excited about this number, in part because pieces of this ppi that speed into the fed's cce indicator. to the extend they were low, also going to help the fed believe in the down, decline in inflation. we've seen gone the other way. cpi report garnered a lot more attention these days, because of what it did to the fed's deferred inflation indicator good numbers i point out a big part of decline was the trade component, which is a profit component. they try to, a margin component. try to estimate from wholesalers. so as a piece that feeds into it in terms of what's going on with the fed's pce. retail, a good question now whether or not we take a break here after that strong, strong number we had in september i was surprised it was not

revised lower. or is this just beginning of the slowdown we've waited for from the consumer are they taking a break before the holidays or does this auger poorly, before the holidays, watch that high frequency data and other data we have in terms of components, furniture down 2%. autos down 1%. just have the to wait and see whether or not it's beginning of something or just a break they're taking from a strong series of consumer spending. joe? >> quite a bit about inflation earlier, steve just bears repeating that if you were shocked, sticker shock, from the, when we hit the high of 9%, things still -- went up 9%, they're still there, except a little higher than 9%. because there's been six, five, four, three -- all of those additional smaller increases

that's what we forget. so, i mean, i'm still shocked whenever i go to the supermarket. still shocked at a lot of -- they're there to stay, we're not -- never going to deflate. are we ever >> i'm shocked how little they appear to be paying you, joe, that you're shocked by what you see at the shopping market at the grocery store >> tell me about it. i've been dealing with that for 30 years how little i'm paid. >> i'm going to give case acall after this discussion. >> thank you >> let me -- let me -- no. i think you got it pretty good, agent joe. let me tell you what the debate is here. if you want people to feel better, what you would attack is the price level, not the rate of change you want to go back to where you were i don't know how far back to when my dad told me he would get a pastrami sand chwich and takeh

subway for a nickel. policy, change the rate, the problem is, why don't you attack the price level? if you bring down prices, you probably also bring down wages wages will go down with prices so you've got to be careful what you wish for you want to go back to the old times, say pre-pandemic era. pring down the price limit but you'll bring the wage level down right? >> happened so quick, and kind of out of the blue a couple years ago and also seeing what things cost, versus what they cost three years ago for example. all right, steve, thanks. programming node -- >> joe, you want 30 an hour? 35 an hour what is it you're can after? >> i want -- a, what gm, what those union guys were asking for. i want a 40% increase and a -- and a four-day workweek. >> a good deal

>> it's close. still valuable >> give him a call on your behalf, joe. >> he said, no >> got to go. no way president loretta mester tomorrow on the exchange at 1:30 eastern time coming up, take you live to san francisco where a little later president biden is scheduled to meet with chinese president xi jinping and commentary from former u.s. trade representative and current cosel chunmiael froman stay tuned you're watching "squawk box" on cnbc. tailor-made for trader minds. go deeper with thinkorswim: our award-wining trading platforms. unlock support from the schwab trade desk, our team of passionate traders who live and breathe trading. and sharpen your skills with an immersive online education crafted just for traders. all so you can trade brilliantly.

(sfx: stone wheel crafting) ♪ the biggest ideas inspire new ones. 30 years ago, state street created an etf that inspired the world to invest differently. it still does. what can you do with spy? ♪

loretta mester welcome back to "squawk box. event much world will watch today meeting in san francisco between president biden and chinese a president xi jinping we have more good morning. >> good morning. president biden landed in san francisco late yesterday to be greeted by local officials and head off to a democratic party fund-raiser last night here in san fran chinese president xi jinping landed shortly thereafter greeted by janet yellen, gavin newsom and a military honor guard. still a mystery, officially, where this meeting will actually take place the administration only saying happen in the san francisco bay area and not offering public details other than that for security reasons before his departure yesterday, president biden was asked, what a successful meeting would look like here's how he described it. >> get back on a normal course of correspondence. able to pick up the phone and

talk to one another in a crisis, being able to make sure our military still has contact we can't take -- as i told you, we're not trying to decouple from china, but what we're trying to do is change the relationship for the better. >> all that in keeping with relatively low expect aation se around the meeting outline agreed to already, the key from biden reestablishing military-to-military communications helping to prevent an accidental confrontation in the region. president biden would also like china to agree to measures limiting flow of fentanyl to the u.s., and on the chinese side, an opportunity for china to reset global market expectations about the direction of its economy. one way they'll do that is with a $2,000 a plate dinner tonight with what is expected to be a glittering array of american ceos here in san francisco, a chance for beijing to remind

washington and the world that it has powerful friends here in america. already seen some agreements nailed down as part of this overall process. the administration announced last night a u.s. climate envoy john kerry agreed to climate measures including relaunching bilateral talks. progress already wait to see what the rest of the day brings back to you. >> watching it all and i'm sure talking to you about it as well. thank you. >> you bet. what are you laughing at >> a lot of stuff happening in the world. that going for us. john kerry and some type of meet more to talk about things. of course, we have ukraine and the middle east. talk more about the meeting today between president biden and chinese president xi, let's welcome counsel on foreign relations michael froman served as u.s. trade representative in the obama administration mr. froman you say even a

leadership statement is going to be hard enough to get something everyone agrees on if we can't do that, does anything really substantive happen although we did send people over to try to get the talks about military, you know, talking again. that did not happen. if we did accomplish that, that would be enough. wouldn't it? >> yes i mean, three things going on in san francisco. there's the apec leaders' meeting. offering 21 economies. moving ahead issues like inclusive growth, sustainability, cooperation, integration. those modest steps forward there's a biden/xi country talkint summit al goal, stabilize the relationship going into 2024 with elections in taiwan, elections here, of course. china likely will, china likely to play a big issue. both leaders, and countries, a

sense to get done what they can and send a signal they want a sable relationship going into 2024. >> do you think, ambassador, that -- that we're in a stronger position, because of, at the expense of china with the economic problems that are so well-documented with president xi and china's, what they're having think this point? do we have high ground >> i agree with that, joe. i think a year ago, the common refrain coming out of beijing was, the u.s. is in inevitable decline, china on the rise now here a recession well, still is possible. seems to be receding on the horizon, and china, slower growth high youth unemployment and tools used to get out of the situation, like investing in property or investing in infrastructure aren't really available to them anymore. used that tool up and in fact that's become part of the problem. i think the u.s. goes into these

meetings in a relatively strong position given our economic performance vis-a-vis china. >> near and dear to president xi and more important than ever, does that mean that some of the things that, worst-case scenarios we read about all the time in the press, for why we should fear china? are those put on the back burner in china because they need more, you know, foreign investment they need the united states at this po this point can we add more years on to where taiwan goes? and still buying up land, still sending spy balloons any of that going to change? >> i don't think we can afford to be complacent about it. i think still engaging in a very significant military buildup, significant nuclear weapons buildup and exerting themselves around the world

doesn't mean they don't have domestic issues to deal with, but i certainly wouldn't underestimate their capacity to deal with them on the foreign investment, interesting to see on one hand, president xi sending a very strong message of foreign company, come back to china, invest wants kceos to coe back and implementing data laws detaining foreign executives, berating offices of u.s. and european firms, and that's sending a chilly effect on the investing community exactly at a time pe would like to invest in it. >> highwahow directly can the president say we want you to put pressure on iran, on russia? i mean, can that conversation happen as a, as a function of these other issues, which maybe we have leverages or maybe we don't? >> i think that those conversations can happen, and

i'm sure that they will happen the question is what is china's response because right now china is enjoying the fact that we're sort of tied down in ukraine tied down in the middle east it's a good distraction from what's going on a year or so ago and talking about taiwan so i think from china's perspective, whether through russia or whether through iran iran through its proxies, hamas arnold hezbollah, being brought into the middle east and europe precisely at a time when it had hoped to complete the pivot or rebalance of asia. >> doesn't sound like the u.s. does have leverage just trying to understand, your understanding in terms of the intraplay between these issues, is there one or do they happen discreetly because on one hand you have all of these u.s. ceos playing $2,000 a plate to have dinner

with pledresident xi. the other hand relying on the fact china needs foreign investment it's very muddled here. >> i would not overstate our leverage over china's position china has been remarkably disciplined in pursuing its self-interest narrowly defined, and i think the onus is on us and the rest of the world to demonstrate to china that re-establishing peace in europe and in the middle east is in its interest and not that we're going to have leverage in such a way to force them they wouldn't otherwise see as being in their short or medium term interest. >> i would think that even long-term, the two superpowers is a pretty good world because you settle each other, and you manufacture things, sell it to them they buy things from us. there's comparative advantage.

but is that long-term -- does that go against what the real motivation for the ccp is, mr. ambassador do they want to take over and do they want to basically have us more subservient to china? >> i don't think -- you know, unlike the cold war, the soviet union, i don't think china hopes to export its ideology or its system to other countries. i think it wants to make sure it has access to everything it needs anywhere in the world to succeed in its own domestic agenda so, that's why it's investing all over the world to get access to commodities, to the basic inputs, to food where it has a real problem in terms of food security it's using all of its tools at its disposal like the belt and road initiative to try and bring other countries closer to it and so, i think it's a bit more -- just to be left alone by the u.s., to go out and do

whatever they need to do to support the kind of growth >> you think it's altruistic they want to bring their billions of people into the modern world or is it they need to do that for the ccp to stay in power >> i think the legitimacy of the ccp up to this point has been dependent on being able to deliver that kind of high economic growth and raising people up out of poverty, bringing people from the countryside into the cities and creating a real middle class life for hundreds of millions of chinese. they have been quite successful in doing it. it's now plateaued, and they need to think through what their next stage is. >> very good obviously, be a lot of coverage of what's happening out in san francisco today. thank you for your time today, ambassador >> thank you coming up, what to watch in the markets when the open bell rings. the futures, take a look, in green across the board 90 points on the dow nasdaq up 88 points.

s&p up close to 15 points. (vo) while you may not be a pediatric surgeon volunteering your topiary talents at a children's hospital — your life is just as unique. your raymond james financial advisor gets to know you, your passions, and the way you give back. so you can live your life. that's life well planned.

little more than half an hour to the opening bell on wall street joining us now on yesterday's market rally and what's head for investors is chief investment officer, founder of the

multiasset strategies and solutions team at voya investment management. we've pulled back from premarket session highs in terms of the futures on the back of the ppi what do you make of the markets here it does seem like the ten-year yield ticked a little higher on the back of that data, and we lost some of our altitude. >> yeah, i think, overall, the data's been really, really good for the market turns out inflation may actually be transitory after all, and that's what markets really should be focusingon, the inflation data has been great, better than i think anyone forecast that takes the -- basically means the fed is done and the risk that the fed overtightens and causes a recession is off the table. so, yeah, little pullback this morning because retail sales were a little bit stronger than people were expecting, but clearly slowing from the burning third quarter. inflation is great earnings troughed in the first quarter of this year, so yoeah,

after such a run-up, having a tiny pullback in the ten-year or having rates pop a little bit is, i think, expected, but we've seen the high-end rates. >> if we've seen the high-end rates and you think we have a soft landing and the fed's out of the way at this point, which sectors are a green light in your view? we saw the regionals in yesterday's session jump by about 7%, and i'm wondering if that -- their assets, their books look better when rates go down, and here we are. that's exactly what we saw in yesterday's session. bank of america was a huge beneficiary yesterday because of that move in rates do you see the pathway to the investment financials? >> yeah, so, financials, tech, all the stocks that are interest rate sensitive, growth stocks, all should be doing better, long duration assets. you look at banks and other financial service companies that have books that would be -- loan books that would be severely hurt if there was a recession. take that risk off the table, all those stocks look better, no question about it.

>> semiconductors, new record high are you a believer or do you take a look at those multiples and think, you know what, in this market where everything's going to rise, why should i pay such an above market multiple for this group >> fair question i think you should have some the a.i. revolution is real. it's not my particular area of expertise, but the a.i. revolution is real i use chatgpt 4 every day in my work, personally and professionally it's created a positive demand shock for chips of all kinds, and one thing we -- one thing we have at voya we talk about is, don't be short innovation. it's not just the big gpu chip makers but the chip makers that are supplying all the nuts and bolts to build these machines are all having positive demand shocks that's going to help margins yes, they're expensive, but it's not unwarranted in my opinion. >> great to speak with you

thanks >> missing out andrew, can you put in chatgpt, questions i should ask nikki haley? is that -- will it come up with -- could we do that do we not have to think at all anymore? >> and then we can just get somebody else to read them why do we have to pay you? you get a 40% raise and a four-day workweek. we'll get somebody who's willing to work for a quarter. >> give me one second. it may not do it because, you know, it's using data from -- now it's browsing with bing. and i said, questions we should ask nikki haley in an interview. that was the question. it's visiting news.yahoo it's going to different places in preparing for this interview, important to address topics that are relevant to her career in public service some of the areas recently addressed include israel, anti-semitism, border issues,

education. questions could range on foreign policy or stance on domestic issues >> yeah, yeah, yeah. we're still better >> i think you're all right. >> my money's on us. >> a little bit better >> yeah. >> i don't know if that -- >> in your face. >> i don't know if you deserve a 40% pay increase >> in your face, chatgpt we're better >> oh, now i could say, what are the toughest questions you could ask? we'll tell you tomorrow. >> let's revisit tomorrow. join us tomorrow thank you. you'll be back make sure you join us. "squawk on the street" is next ♪ 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 bulls looking to add to tuesday's monster rally as ppi now gives us more disinflationary cues, down 0.5%, biggest monthly drop in two and a half years retail sales soften up a bit as well

ten-ye g