bit about bonds. all right, we'll be looking for tempered returns, and quality is important, but we appreciate having you on today, emily. thank you. >> thank you. it's just starting. >> i'm tired. >> i'm glad i don't have to do that. i'm not going to send them any questions. >> he's got it covered. andrew will be there all day. >> join us tomorrow. we'll definitely be talking about it. "squawk on the street" is next. ♪ good wednesday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer, david faber at the new york stock exchange. futures solid as lower yields continue to provide ammo for the bulls. ten-year hits 4.25%. big morning on tap. dealbook summit in new york. richmond fed president barkin at the cnbc cfo council summit and in a few moments, gm's mary

barra will join us. gm shares, up 9% premarket. lot of news here. >> that accelerated buyback is really extraordinary. real commitment to shareholders, and i think that especially in light of adam jonas's note yesterday, this calls all that into question. mary barra has been under fire, i think, because of cruise, which is the problem they have had with the ev. >> well, self-driving. >> they spend money on ev. >> and then obviously, rolling that back in terms of at least their ambitions in -- in terms of timeline. >> right. battery problems. she highlights that. david, what i am surprised that even after all that, the amount of money they have is extraordinary. >> is that almost part of the point here? just saying, hey, look what we can do? >> i think it's definitely the case. i wouldn't be surprised if ford didn't follow suit. this thing sells at four times earnings, carl. >> four times earnings, yeah.

>> typically, that means earnings are going to be cut in half, but this is a kind of encouraging thing, to buy back this amount. very rare. some people would say she should take in private. can't do that, obviously, they have a huge debt position, but i have to tell you after the cruise, the self-driving, this is quite impressive, and i think it says, we're not dead. we're good. >> there's going to be some savings on the cruise front. meanwhile, we got numbers on the impact of the strike, jim. $1.1 billion adjusted ebit impact. yesterday, jonas had a note, morgan stanley, looking at the time it takes an average s&p'er to spend their market cap in capex r&d. it's normally about 50 years. in the case of gm and ford, it's about two years. >> well, what's really incredible is that first it was a false construct, because sure, the s&p, you talk about not a lot of companies, then compares to caterpillar. that's very fair.

if mary was looking at that, say, geez, caterpillar is 26, 27 years. it was a great piece. obviously, did not motivate this, but i do think that the sergio quotient did make me feel that i wanted a reason for being. i wanted a reason to own these stocks after how much money they spent on r&d, and yet, name me five brands of gm. okay? but throughout all this, they still have giant cash flow. >> they still make money from selling good old i.c.e. vehicles. >> now, she has confessed about ev, batteries not good. >> right, well, we're going to have the opportunity to ask her. >> i'm just saying, if you have self-drive, not that good. you have batteries, not that good, but you have i.c.e., very good, i think there's -- >> it's all about what's coming, and -- >> full speed. >> -- investors have been paying for these future cash flows. conceivably, you have to make that transition. eventually, we will get to both ev and autonomous. it may take a lot longer than we

think. >> gm and ford pride themselves on having vehicles that people want and need and can afford, and do the evs fit those categories? maybe the f-150. but i think it's -- i'm not saying it's the -- the love affair is over with ev. i'm just saying, maybe there was never a love affair, other than with tesla. >> day before we're going to get the cybertruck unveiling. >> stainless steel. i know we can talk about that with phil lebeau. it is a material that costs too much. it's a brilliant material to use. i think this is going to be end up being a lamborghini, when what we really want is like in the -- in the ads, football, we want chevy truck, you know? we want to be able to throw you and your whole family in and all the furniture and then put in some hay. i don't want to feel like it's not going to pull it. >> no. you want to know it can. >> yeah. >> david. >> yes, sir? >> torque. >> torque. very important. torque. t-o r-q-u-e? >> very nice. >> we have phil.

he knows torque. >> guys, important to note, given gm's response so far, is an accelerated share repurchase. >> right. >> by the end of next year, it's going to be all done, and in fact, as much as, you know, 6.8 billion will be done immediately, essentially. >> don't you find that unusual? >> 1.37 billion shares. >> you've been around. >> this is not as though they're just reupping on an existing buyback and adding to it. this is, we're in the market immediately buying back a significant number of our shares. >> today. >> that is going to reduce, obviously, the outstandings, and therefore enhance earnings per share. >> but i keep coming back to what she's disappointed in. the difficulties with battery module assembly. i keep coming back to david's excellent interview where this is not a problem with another manufacturer. >> oh. may 16th. elon musk. >> may 16th.

what is that, like, a day we're supposed to know? >> a day that will live in infamy. >> although, today, he's going to be -- i've lost elon to sorkin. >> you ever play bridge? >> i never did. my grandmother -- >> david's two, no trump, for those who know. >> that's too obscure for me. >> me too. >> maybe buffett would know. >> maybe i'll take it up as a hobby as i move into my later years, jim. will you play with me? will you teach me how to play bridge? >> i can do rummikub and crush you. >> carl, would you like to join our bridge club? >> let's move on to the markets amid investor hopes. that waller question yesterday got things moving, got the two-year down to, what, 4.67%, going back to july now. >> i think that what -- boy, the chinese must be sitting there saying, how can they have a 5% gdp growth and declining inflation? we want their business model. i mean, the chinese -- david,

they used to be able to command these numbers and then they had the unemployment among youth, which then the best way to deal with that is, what? stop reporting it. these numbers are extraordinary. the pce must be extraordinary too. there's many reasons why these numbers have come together and my hat's off to bill ackman for some good calls. >> that was a good call. >> two calls. >> the fall in rates has been significant, to say the least, given what it's been, three weeks ago, we were at 5%. >> we have a number of quarters that reported today. last time, we had crowdstrike, workday, intuit, and whatever multiple you wanted to put on them before this -- by the way, they were all good -- what you immediately say is, i got to pay more. i'm not paying enough. the line of the quarter so far was a neil bush read trying to set everybody straight on workday. he did not lead the quarter anymore. carl did. co-ceo, but still -- >> we're talking about workday. >> he just said, look, we keep hearing about elongated cycles,

how hard it is to do business. forget that. it's a different dynamic for every company post-covid. they want to have platforms. so, stop focusing on this notion of, it's hard to do business, and start focusing on this notion that business is great. that's my read-through of his, because the workday quarter of the ten questions, we got six "congratulations, gentlemen," which is the ratio that takes it up. >> tap is up 11. >> tap had just a terrific, clean quarter. george curian is a great manager, not talked about enough. i have kurtz on tonight from crowdstrike. this is a quarter where you feel your brain is going to be hacked unless you hire crowdstrike. >> really? >> they play on people's

kindness. the kindness of strangers. >> i first did that cyber espionage. they crawled all over all my stuff. >> april 23rd. >> another date. >> i have no idea when i did that. >> i had it implanted. >> they own me already. not own me. they already scanned everything i i ever had ten years ago. >> i thought that was elliott partners. >> elliott doesn't know anything about me. you didn't hit intuit. >> i mentioned it. >> you mentioned it -- >> you want me to talk about credit karma? >> it's $160 billion market value company. >> it's the engine of small business, and small business is the backbone of the american economy. thank you, larry kudlow. >> where'd you come up with that one? >> larry kudlow. kudlow and cramer. i lost the coin toss. it should have been cramer and kudlow. but intuit had extraordinary numbers and the one division they had that wasn't that good,

they had told you it wasn't going to be that good. credit karma. mail chimp was a good story. i never liked that name. >> q2 revenue in line, but still up 11, almost 12%. >> intuit, if anyone has a small business, you can't live without intuit. you can't. nice tie-in with automatic data. meantime, the business world is remembering a legendary investor, long-time berkshire hathaway vice chair charlie munger has died at age 99. he and buffett had the decade-long partnership. our becky quick sat down a couple weeks ago, and she asked munger if he had any regrets. >> is there anything left on your bucket list, anything you'd like to do? >> well, that's an interesting question. i am so old and weak compared to what i was when i was 96 that i

no longer want to catch a 200-pound tuna. it's just too much work to get it in. takes too much physical strength. so, i would have paid any amount to catch a 200-pound tuna when i was younger. i never caught one. and now, given the opportunity, i would just decline going. i would only go out after that. there are things you give up with time. >> you're pretty active. you've got a busy social schedule. you're on zoom. you have breakfasts and lunch. >> i like it that way. >> yeah. >> that's my idea of a proper old age for me. and i didn't plan it. it just happened. and when it happened, i welcomed it. i am very good at recognizing

unfair advantages. and i got unfair advantages in old age the way i got unfair advantages in non-old age. and when they came, i just grabbed them. boom, boom, boom. one grab i never made was for a third wife. too late. >> jim, i think investors really enjoying reviewing his life lessons, spending less than you earn, investing prudently, not relying on luck necessarily. >> no, and i just think you can come back over and over again to his notion that you want to buy really great properties at fair prices. david, it's really emblematic of how great he is that i think he actually changed the greatest investor of all times' minds about what companies to buy. >> buffett says that. instead of picking up cigar butts and taking one last puff, which was the early days of

berkshire, munger said, no, buy the best companies at fair prices instead of not great companies at discounted prices. >> becky has a special tomorrow night. and becky's work has been extraordinary. i read the print articles. they're all good, but she captured him, and obviously, look, to say he's hysterical is, in this business, yeah, he's amazingly funny. took me an hour and a half for an 80-pound tuna. hour and a half. >> he was looking for a 300-pound tuna. >> i know, that would take five people to bring it in. what an amazing guy. he's funny. it's kind of like he's with us still. the guy is just otherworldly. >> he'll be with us for a long time to come. we look forward to tomorrow night, thursday, 8:00 p.m., we'll pay our respects to charlie munger. when we come back, gm's mary barra first on cnbc.

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gm up sharply after announcing that buyback, plans to boost the dividend next year, reinstating guidance. our own phil lebeau joins us this morning with a special guest. hi, phil. >> hey, carl. let's bring in mary barra, chair and ceo of general motors. mary, i just heard you on the conference call with analysts. some fairly tough questions about where general motors has been in the last year, and you said it on the call. you have had some execution issues. we'll talk about the guidance and the updated guidance in just a little bit, but how do you convince investors, yeah, we had a bad last year or 2023, but we're going to get our act

together? >> well, i think, phil, when you look at what we've achieved in 2023, yes, we had some challenges with module production that we weren't able to deliver as many evs as we would like, and we have had this recent incident with cruise, and we're doing a review, and we will make sure that we have the right path going forward. but from an i.c.e. perspective, you know, really have really strong performance that we have been able to have the right products that customers want to buy. we haven't -- we're below what the average incentive prices are, so when we look at other parts of the business, they have operated very well. there was a lot of challenges this year with labor negotiations, et cetera. those are behind us now. and that's what gives us confidence in the business, confidence to do the asr at a $10 billion level, and you know, we're going to move forward and execute, and again, move past these, i'll say, bumps in the road in the areas of autonomous and electrification. >> mary, let's talk about that

stock repurchase program. you're immediately going to buy back enough stock to retire about 17% of your outstanding shares out there. when did the board make a decision, you know what, $10 billion is the right amount of money that we need to spend in order to bring down the number of outstanding shares and to boost the stock? >> well, i think when you look at, from a capital allocation framework, we always look at that on a regular basis from a board perspective, and this was a recommendation from management, because as we got through some of the elements of the year that were driving a lot of uncertainty, once we had that certainty, we were able to make this decision and get to a price or get to a place from a cash balance perspective that is more what we have said we want to have going forward, so this was really a reflection of our capital allocation framework. you know, when you look at the last few years, there's been a lot of uncertainty, whether it's the pandemic, semiconductor, labor, those are past us. we have confidence in the business going forward, both in our internal combustion and our

ev and software and path that we'll work on from an autonomous perspective. that's what gave us the confidence and the board the confidence to make this decision. >> thank you, mary, for being on our show. i wanted to ask you, mary, not that long ago, i was in a self-driving car in san francisco. one, was i in an unsafe position? should i not have been in there? was that a danger to me, that i rode in that? and two, why did kyle vogt leave? i understand he wanted to spend more time with his family, but i also understand that wamo did not have to get pulled and yours did get pulled. i want some answers on what happened here. >> let me take that from a reverse order perspective. i think when we look at from a cruise perspective, kyle left on his own. so, that was a decision that he made, and i think asking him why he did that, i think, would be a better question for him. when we look at, you know, the difference of what happened to cruise, i think it was a lack of transparency, and this is

something that, when general motors learned what had happened in the incident that was, you know, tragic, we have gotten more involved and leaned in. we still have a lot of faith in the technology community and the technical talent that's at cruise as we move forward, but clearly, a better job has to be done in building relationships and being transparent with the regulators at the state, the local, and the federal level, as well as with first responders. so, i think that was one of the issues as we move forward, and we're already building the relationship and leveraging the strength that general motors has in the space of having a strong government relations team at all levels and that's one of the things we'll do forward. you know from a general motors perspective, safety is an overriding perspective, and we always focus on transparency. so, driving that into the cruise operations is a number one objective that we are already undertaking. i've ridden in the vehicle many times as well, and i think as we go with this technology, we have to look at the fact that 40,000

people lose their lives, and 90% of accidents and fatalities caused today are caused by human error. as we move this technology, we've got to get better faster, but when we look at where it is compared -- and there's been studies done as it relates to safer than a human driver -- i think what we've learned in this, it's got to be much safer than a human driver. >> fair enough. i want to switch directions to something that hasn't been talked about that much, which is china. in 2018, your market share was 13.7%. now you're the a 8.6%. in the meantime, between 2018 and at least the first nine months of 2023, your sales may have been cut in half. would it not be better to try to figure out what to do with china than just buy back shares, and what happens if president biden says, you know what, cars cost too much money, let the chinese sell cars here? >> well, i think a lot packed into that question there, but we have been working -- i mean, i

think there's a lot of change happening in china when you look at their rapid shift to electrification and the rise of a lot of domestic ev companies. i think there's still sorting that has to happen. there's over a hundred companies, and many of them are not profitable. we have -- we are still in the high single-digit share perspective between our two joint ventures and so having the right portfolio and participating where our brands belong in that market is something we're very focused on, so i think we can have a good position in china but recognize there has been some structural changes there. your second question, jim, was? >> oh, just in terms of -- i'm trying to figure out how much money -- would that money be better spent there? i'm trying to figure out how come your sales went down so much. the sales are down substantially in terms of market share and amount of money. >> there has been very much a structural shift with the dome

domestic oems gaining share and gaining consumer acceptance, which i think for several years prior, the markets were dominated by western manufacturers. with this shift to electrification, there's been a reset there. when you have a hundred new entrants coming into a market, there's going to be a shift. we think we're well positioned with our plan in china, and that was all factored into what we're doing and from the asr. we think we have the right plans for each areas of our business that gave us confidence to do the $10 billion asr. >> thank you. >> mary, it's david. speaking of the consumer and a shi shift, it appears there seems to be a down shift in demand for evs. it's a little more than a month ago that you slowed your electric car production in north america, and i'm curious, how would you characterize that dan demand right now for evs worldwide and for this country? to what do you attribute this potential shift down in terms of demand? >> i don't think we were ever going to see a straight line from an ev adoption perspective. we've seen ups and downs already in the china market.

we're just getting into the market from a european perspective. but i think you're going to see ups and downs but with an overall trend of increasing from an ev perspective. and when you look at the united states, you've got to have the right evs. the biggest markets are in the 30 to $40,000 -- excuse me, the biggest segments are in the 30 to $40,000 priced vehicle. we have the bulk there that's done very well. as we get more and more of our chevy blazer evs and chevy equinox evs into the market, i think we're going to hit a sweet spot with a vehicle that has no excuses. there's no sacrifices that someone has to make. i think that's going to end up being very important as well. i think we're going to see an presidenti up and down with a slope that's positive. charging infrastructure has to be robust as well. i don't think it's that ev sales are going down. i think the rate of growth has slowed, and i think we're going to see variation as we move

forward. >> mary, it's phil again. how confident are you that you will get the issues when it comes to battery cell production fixed and you can ramp up production? because that's the key to all of your guidance when it comes to ev sales and margins in '24 and '25, and frankly, it hasn't worked out so well in '23. how quickly wcan you fix that ad how quickly can it ramp from here? >> this is very important that we get the products out. we'll have more of h-2 in '23 than we had in h-1. we think we have more module capacity coming online toward the end of this year into early next year. that's why we feel we'll see improvements in h-1, h-2, and beyond that, we don't think modules will be a constraint. lot of learnings there that we have applied, and as i mentioned on the call, we have not only changed the process, we have also changed the team, so i believe that that's behind us,

and i'm confident in our ability to deliver significantly more ultian-based ev products and these are products that have no compromise. i want to get there. i'm disappointed where we are today, but i think we cleared the path, and going forward, you'll see that in '24. >> just to be clear, mary, you guys are still sticking with your guidance that you expect to have single-digit margins, positive margins, on your evs in '25? am i correct? >> you're absolutely correct, and you're going to hear more about that tomorrow from paul at the investor conference. >> mary barra, chair and ceo of general motors. appreciate you joining us today, mary. i know it's a busy day as you guys announce an accelerated stock repurchase program. carl, back to you guys. >> phil, thank you. phil lebeau this morning. meantime, jamie dimon on stage with andrew sorkin at dealbook in new york.

he began by asking why dimon views it as a dangerous time as well. we'll listen to that in a minute.

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opening bell and the cnbc realtime exchange. at the big board, it's build-a-bear workshop. at the nasdaq, it's wesbanco. as we mentioned, jamie dimon taking to andrew sorkin. andrew began by asking dimon why he views it as a dangerous time. here's what he said. >> if you look the a history and open the newspaper of any month, any year, of course there's always tough stuff going on. wars and depressions and recessions and -- but if you look at this time and what's happening in ukraine, a 600-mile front, free and democratic european nation, 600,000 casualties, huge humanitarian crisis, on the border of nato, nuclear blackmail. it's affecting all oil and gas migration, food costs, and all

international military and economic relationships. that's pretty tough. and that was before the terrorist attack in israel. and so, i look at those things as kind of, it's dangerous, and you know, we need to get through it. hopefully, it'll all go away, but if you look at the history of battles like this, they're unpredictable. you don't know the full effect. and i have spoken to a lot of people. i think you've talked to condi rice and bob gates and some of the military folks. they would say, it's really complex, and it's affecting america and china. >> as a result of this, though, what do you do about it? meaning, we can all sit and say this may be one of the most dangerous times in the world, but how are you -- how are you changing what you're doing as a function of it? >> well, if you're talking about the company or talking about the nation? i think, as a nation -- >> let's go both. >> this is my own personal view. we better have the best military in the world, bar none. there's no replacement for that. i think we learned a lesson, got a little complacence, which

happens in countries, it happens in companies. the world was always a dangerous place. we just forgot. number two, i think oil and gas can be explosive, expensive, and it hurts poor nations and poor people, and you would be very thoughtful about it. i think this is about keeping the western world together. so, the western world, think of military and economic, and you know, it needs american leadership, not rude, arrogant american leadership, but american leadership to make sure this world stays together and that affects trade. that affects all economic relations, and we have to do a good job at that. i don't want the book written in 50 years saying how the west lost. that's what it's going to take, and hopefully we'll have that. >> how do you handicap this? it's one thing to say, look, this may be one of the most dangerous times in the world. but is that a 10% chance that it's -- that it is the most dangerous time? how do you think about that? it's also very hard to bet obon the end of the world. >> we do risk management.

we don't look at risk management saying, we don't think it's going to happen. we do look at percentages. what's the range of potential outcomes? when you have this kind of risk, you better deal with it very seriously, because the chance of something going wrong is high, and if it goes wrong, the cost to that would be enormous. that's how i look at it. i think every citizen of the world, the democratic world, should be looking at it and saying, what can we do to do a better job? the first thing is the military side. ronald reagan, we don't win from a position of weakness. you avoid war from a position of strength. we have to do that. and i think we should be supporting free enterprise. bob gates wrote a book, which is brilliant, but there's a first chapter of a book called "exercise of powers, symphony of power," and he talks about how we overuse and misuse our military muscle but underuse development finance, communications, like the benefits of being free and freedom of speech and freedom of religion and freedom of enterprise, communications about

that, economic relationships, diplomacy, so i traveled around the world, you know, america's absent in some places. the chinese now are all over latin america, all over africa. i'm not against them. i'm simply saying, we need to do a better job at that. if you look at our development in finance and some of our stuff, those efforts have been coming down for years, and so we need to thoughtfully and strategically handle that problem. >> just walk through the permutations, though, if you could. how does it metastasize? you look at what's happening to israel, and we're going to talk to the president of israel in just a little bit. we're having the president of taiwan on in just a little bit. you mentioned china and the middle east as examples. what do you think could happen? >> i also mentioned nuclear blackmail. mankind faces some huge risks. there are three i'm going to mention. one is obviously these wars, which is not one of those three, but nuclear proliferation. that is probably the most dangerous thing facing mankind. climate change, which we need a

lot of work to do, and we kind of don't really have our act together on that if you think about good policy, and another pandemic. in my view, we were lucky in this pandemic. it wasn't as deadly as the smallpox, and it didn't kill children. we need to get our act together to get those things done. wars are unpredictable. what's going on in the middle east is unpredictable. hopefully these wars will end up in armistice and peace that's good for ukraine and israel, but you can't count on that happening, and certainly, you can't count on it happening before we meet again a year from now. >> let me ask you about the role of business in the -- in the geopolitical sphere. you do a lot of business in china. there's a report that you were going to underwrite the xian ipo. you do business with bytedance, which happens to be the owner of tiktok, a business that a lot of people think is fundamentally a national security threat to the united states. how do you justify that? >> i was in china, and of course, there's people afraid about you being pro-china and stuff like that. and i said, the chinese know one

thing about me. i'm red-blooded, full-throated, free market, pro-capitalist, pro-american. and i salute the american government does and we're talking to them all the time about, what is the right way to deal with national security? it's not shein. but when the government comes up with what they want to do, i'm going to salute, and that's what jpmorgan is going to do, but it's a very complicated subject. every nation has national security interests. ours is semiconductors and, you know, maybe some data, but for europe, it's energy. they are completely reliant on outside parties for their energy. even for china. they import, i think, nine or ten million barrels of oil a day. every country is going to be looking at its own national security interests, so the complexity of china, we'll work that. we want to be at the table and help figure out -- and i think the government's talking about the right way. narrow garden, high walls, s

semiconductors. 100% of our penicillin and pharmaceutical parts come from there. obviously, we should fix that. >> is there any part of you that says, for example, doing business with bytedance, with tiktok, we're going to have kevin mccarthy on. he's not a nan offan of tiktok. there are a number of states trying to ban tiktok. >> i'm not going to talk about clients. you can imagine the due diligence and work we do to figure out what the truth is about those things. if some of those people doing things that we think are truly bad, we would not bank them. and of course, the american government will have a point of view in that, and we'll engage in those conversations too. >> let me ask you about -- >> but i also think, engagement is good. i'm not afraid of china. we have all the food and the atla atlanta ib and the pacific. we have not pissed off our neighbors, great relationships with mexico and canada. they have a very complex neighbor and they've done a good job angering all the people around them.

they are all remilitarizing. japan, the koreas, philippines, afghanistan, india, pakistan, and whatever you think about russia, they're not great friends. a mere 30, 40 years ago, there were armies on both sides between russia and china, and they have to import ten billion barrels a day. they have terrible demographics. i'm not afraid of china. i think we should engage exactly the way the administration is doing it today and i think it's good for an american bank to be there to help multinationals around the world and china with their own development if it makes sense. if, for some reason, the american government says, no, can't do that anymore, so be it. >> what is that risk? >> i don't set foreign policy for the united states. >> what is that risk and how do you think about that risk? the reason i ask the question is we have a number of businesses today, we're going to talk too bob iger, big business in china as well, and to the extent you think that the war in ukraine could have been a dress rehearsal for what would happen if there was a takeover of taiwan, maybe you don't think it's a dress rehearsal, but if

that were to happen, if you remember, most u.s. businesses left russia. now, they could do that economically. it was not the hardest thing to do. it would be much harder for american businesses, for, i imagine, you, for disney, apple, nike, to leave china. >> if the american government makes me leave china, i'm leaving china. it doesn't matter what i think or don't think. but if there's a war in taiwan, you can take all bets off. that will be a major depression. america will be better off than china. and it would be really tough. no one thinks that's going to happen. it may happen. as a risk manager, jpmorgan handled that. but that would be really bad for the world and really bad for china. really bad for the people of china. i don't think it's going to happen. but you can't say it won't, so you have to be prepared for it, and -- but i think the best thing to do is help the american government figure out what we need to do to protect our national security, protect our allies, keep the western alliances together and make it clear to people who are adversaries or potential

adversaries what the cost to them will be of bad actions. that's what we should do. >> we're going to have the vice president here in just a little bit. how do you think they're doing at that? >> i think, you know, i think they've done a good job coalescing the world for ukraine. i think you and i can argue they should have done more quicker and stuff like that. i probably would do more quicker. i think when you have this type of bout taking place, making it harder for ukraine is bad, and we want ukraine to be in a position where they can eventually settle this in a way where they feel good about what's done and that gets very complicated. we need to do a better job keeping the western world together, economically, diplomatically and strategically in the ways i already mentioned. that, we need to do more. for example, for the democrats not to talk trade, you know, i travel the world, speak to the ministers of finance and prime ministers and we're talking to them about all these things, about -- which i'm for. human rights, labor laws, climate. but these nations need help and economic relationships. they almost kind of say to me

sometimes, well, why can't you talk about something important called trade and economics? and i think we should. we should have joined the cpp -- tpp. i begged trump -- i told trump to call it the trump pacific partnership, and i thought it might get him over the edge. >> what happened? >> didn't work. then he did the tariffs, which i'm not in favor of. i was in favor of focusing on the issues between all ignored for a long time about the seriousness of chinese competitive position, and so, you know, we need to do stuff like that, and i think the government has to explain to the people why we need to do these trade things as opposed to saying, we can't talk trade because some part of the party doesn't want to do that. why is us getting involved in ukraine america first? it is. that is -- that's the front line of democracy right now for the world. we haven't learned the lesson in 1938 and 1917. i mean,we got to teach history to people. >> so, we have an election coming up in about a year.

>> yeah. >> what do you think of the two leading candidates right now? >> oh, goed, i'm not going to tell you. >> you're not going to tell me? >> i did come out and make a nice statement about nikki haley. >> you've been talking to nikki haley. >> if you're a very liberal democrat, help nikki haley too. get a choice on the republican side that might be better than trump. >> is that your view, that it's anything but trump? >> i would never say that, you know, because he might be the president, and i have to deal with that too. >> but when he was the president, you said critical things about him. >> yeah, i don't mind criticizing the president. yeah. >> but you feel -- i mean, one of the big questions, i think, is about the business community and whether they should be speaking up or not on politics. this is a big question, especially as we get into this election. and what the right answer is in this particular unique moment. >> you're going to have kevin mccarthy next who got mad at me because we took a point of view on something. when you say -- politics is

personal, right? you all get to vote for who you want. we get to debate and stuff like that. we get involved in policy. i will tell you all the -- we've done a terrible job taking care of our bottom 30% of earners, so you're all wealthy and have money and stuff like that, but their average wages are 15 to $20 a year. they're the ones who lost their jobs in covid. they're the ones whose health is -- they're dying five or six years younger than the rest of us. they're the ones who don't have medical insurance. their schools don't work. they're dealing with crime. what the hell have we done as a nation? i agree with that. we need to fix that. when you talk about policy, obviously, we should -- we need better immigration policy. we need better education policy. we need better infrastructure po policy. >> but you need people are run those policies and who do you think is dogoing to do the bett job? >> when donald trump became president, i went to see him and joined that business council.

those things almost never work, by the way. i left after charlottesville. my daughter wrote me a long, elegant letter and quoted martin luther king at the end. my two daughters and wife sent me a quick email saying, ditto. you're embarrassing us. i called her up, and i said, julia, you have everything right except the conclusion. i'mnot taking myself off the playing field. i will walk into that oval office, try to help whoever the president of the united states to do a better job for our people. that's my job. and i couldn't imagine saying, i'm not going to the white house because of who's there. i don't agree with a lot of the things he does, but i want to point out, we're in new york city, the bastion of liberal society. people -- we should stop talking about ultra-maga. i think you're insulting a large group of people, and then we're making assumptions, es scapegoating, which the press is pretty good at too, where somehow these people believe in trump's family values and are supporting the personal person.

i don't think that's true. i think what they're looking at is saying the economy is pretty good. even the black community has the lowest unemployment rate ever in his last year. he wasn't wrong about china, nato, the misuse of the military. that's why. they're looking at that. and maureen dowd wrote this great piece about her brother. i'm not sure he's pro-trump, but he's pro-republican. people should listen a little bit more to this. if you're a democrat, read george will. read -- if you're a republican, read tom freedman. we should get out of this thing where it's one way or the other. i'm not mad at people who are anti-abortion. if you believe in god and that conception starts at the moment of birth, you are not a bad person. and i just think people have to stop denigrating each other all the time because people take a point of view that's slightly different from yours, and that -- we're a democracy. people should vote and solve some of these issues. and they won't always be what you want. >> explain this, then. you look at today's economy.

here in the united states -- >> that's jamie dimon with andrew sorkin at dealbook, talking geopolitics, some sheer politics, pretty centrist framework, jim, but as you pointed out, his geopolitical stance, he keeps returning to that vrelatively hawkish view. >> it's like listening to a henry kissinger talk about the need for the united states to project its power and not become a shrinking violet. it's about what we can do with our great natural resources and what must be done in ukraine. i'm a stock guy. i'm not going to -- i took political science 50,000 years ago. he said it was a dangerous time. people are going to not like what i have to say. he said it was a dangerous time and the s&p was at 4,327, and then the s&p dropped very quickly to 4,117 and then it just went straight up. there's a big difference between what he's saying and what we do, and i think a lot of people confuse the two, and it's a big mistake. >> right.

listen. he's got to run a business that's global in nature, and he's worrying about things that those investing perhaps are not. geopolitics does not seem to impact the broader market for a long period of time. we've seen that so many times. i do think it's interesting how focused he is on ukraine, because the attention has been divert add bit, given the israel-hamas war, and yet, jamie has been very much focused on that and the threat it represents for quite some time. listen, you can listen to him all day. i think he's fascinating to listen to. >> right. >> in terms of his view and the way he sees things. >> what a great -- >> having sat atop one of our nation's if not our nation's largest single financial institution for 17 years. >> isn't it a delight to have someone who does not play for dinner talk about things. he does not play for dinner, and it makes all the difference in the world. everyone in his -- when he gets involved in politics. he's not beholden. this is what people are like when they're not beholden.

just apropos of something that's on our network that i love, "shark tank," mark cuban, not beholden if he were to run for president. these are people who tend not to do well, because the -- look. the constituencies of the two parties do not talk like this. >> we made the point that many others have made that unfortunately carl does not see come to bear which is that there needs to be some conversation. >> got to listen to the other side. >> look, the fox people vote for trump and the not-fox people vote for biden and there you go. i wish there was more to it. certainly would like it. when he tells fox people to read tom freedman, you know, that's actually not going to happen. you wish it would. he compares 2017, you know, kind of an amazing time. we got in, who knew what to do. 1938, we didn't know what to do. he's right, but again, it's been dangerous. what i don't like about it is he

minimizes dangerous. it's been dangerous since we were born. >> you're probably more hawkish vis-a-vis china than he is. >> much. much. i think -- i just spent the last four days doing deep dives on cybersecurity. what is cybersecurity about other than a couple -- you get some thugs. but most of it is china trying to disrupt us. i believe in the ghost fleet theory, a great novel that marc benioff gave me, about how the chinese could shut down our navy. now, that's obviously fiction, but i do think that the taiwan approach that he talked about and the great way that andrew asked about it was, isn't that the most dangerous thing, not ukraine? yes, because ukraine is a proxy state for us. >> he did say, all bets are off if that happens. there seems to be a lot of concern about it. we'll see if anything actually really occurs. >> what is jensen huang if not taiwan semi? he's got the great plans. >> all bets are off should there really be -- >> it must be protected, but do we have a division? do we have a company of soldiers? do we have a platoon?

>> we're really going to get into that debate here? >> yes, because that's probably the most important placement for military in the world, not japan. how many divisions do we need in japan? i haven't seen japan -- >> in the current political environment, i'd be curious to see how you articulate us sending soldiers over to defend articulate us sending soldiers to defend taiwan. a lot of people want us to get out of ukraine, not get out, stop supporting. >> including biden, perhaps. or scale back. >> they went the other way. >> i'm just saying that taiwan semi is probably the most important company in the world. >> yes, it is. >> semiconductors are up today but i know it's geopolitical day. >> we have a meeting of nato ministers. but to your point these flash pots around the world and we are

close to 4,600, as you said earlier. >> we have been at war many times. let's play warren buffett about what are the best times to invest. it is a terrible thing to say you buy when the cannons go off, blood in the street is hacky, but there's no great time. anyone who's seen oppenheimer, somewhat truthful knows we put our heads in cubbyholes when we were five and seven and were told this would protect us from thermo nuclear war. >> he did include a.i. running out of control. >> and jensen huang. >> i'm sure we'll talk to jensen about it. >> he'll say first they come for the fiction writers -- one of the great lines. a couple of quick things to hit. phillips 66 on the 8:00 hour

with elliott taking that position, that stock is up a billion dollars. i want to get to kkr, they had significant announcements this morning, a conference call with their investment base and they're trying to reset the next few years for that company in terms of the growth they expect. and how they are laying it out, given when you go back and you can see what they've done, take a look over the last few years as well in terms of half a bill in assets under management. they think they can double that the next number of years but they also go in detail this morning, they buy what they don't own. they control an insurance company back in 2021. they own 63%. so they're going to completely own the insurer and we've seen this, apollo leading the way, some people say as much insurance company as anything else at apollo. kkr seeing that benefit as well as modifying the compensation

ratios so it's derived from carried interest. you're lining your employee base with investor base given it's not based on fee income as it is whether your investments do well and we talked about charlie munger this morning. they're looking at something called strategic holdings a business segment comprised of the core holdings. when they buy a company they're not looking to sell it as much as to take dividends every year. they'll hold a number of companies in the strategic holdings they have and pay cash back to kkr. >> berkshire halthaway. >> that part of the business. i spoke to the co-ceo of kkr and he talked about saying, listen, believe cash dividends will come from them. they have as much as 800 million

in ebitda, the share from the businesses that they already have a significant stake in. so that's another area they see as growth. the area being and nutle is going to talk about it about the growth path for kkr. you can see the investors are finding it positive the announce ms from this morning. >> there's a moment in time we have companies saying you don't like us we'll take care of it ourselves. gm moving stock. kkr explaining how much better they are. i didn't know what they had and that's why it's so hard to judge. companying saying we're under valued. wait until you hear jensen huang for a deal at nvidia selling 25 times earnings that's crazy. some stocks are very under valued. >> we started with gm, i come back to you on it. there's a number of investors

pushing back is this the best use of the capital, you have tesla out there continuing to build, get ready for increased demand and this is what you're choosing to do in terms of decision. >> i know. >> short term-ism coming up. >> phil lebeau and i going back and forth. isn't the truth they need to manufacture better. they don't make them as well as tesla. >> jim, you mentioned what you have tonight. >> i want to see foot locker, congratulations, first of the good quarters. it's right now. it's right now. she's going to fix champs too. i have crowd strike, an amazing quarter last night. don't read what he had to say because you will be so frightened about what is happening. slootman is a tough hop ray, snowflakes, the rent the crowd. and marc benioff, i think he will deliver. >> a lot of chatter between the

software names we've gotten and microsoft and now and what it means for crm and oracle. >> i think oracle is undervalued. they're going to fix what they did. their health care acquisition that people don't like. larry ellison is doing more a.i. and amazon knows it. everyone needs a.i. because he saw what jensen was doing. he has the most spare cards. i'm not worried about them. work day, that's a good analog to salesforce. >> we'll keep our eye on deal book in new york, of course, and then there's bkearn at the council in d.c. we'll get you that after a short break.

good wednesday morning welcome to another hour of "squawk on the street" i'm carl quintanilla with sara eisen and david faber live at post nine of the new york stock exchange. markets continue to enjoy what is the fourth best month of any month of the year for the s&p since 1994. holding onto 45, 85, treasuries

helping out a bit as the two year is down to 4.3 or so. and the ten year to 4.25. a lot being driven by the comments by fed officials yesterday, waller in particular, but also encouraging gdp print although a revision from q3 but the bull's have the football at the moment. >> they do indeed. as we take a look, when we talked earlier about the fact that there doesn't seem to be much in the way of the move up, at least today, as you can see, 5.2% is the revision. and yet of course even with the growth we have yields on the ten year, for example, falling -- at least they had been falling again, carl and well below the 5% level that we were right around only what three, four weeks ago. >> mean time, a deal book in new york city, jamie dimon, elon

musk, jensen wahuang. it's jamie dimon's comments this morning, talking about geopolitics, relationships with china and the '24 election cycle that we'll get to in a moment. first of all fed official barken talking in washington d.c. let's listen in. >> 33% fair. >> that's all you need, a low bar. i want to start where we just left off, 5.2% gdp growth in the third quarter. is that too fast? to what extent do you expect a slow down now? >> i've been saying there's a disconnect between the data coming in, especially in the third quarter, and what i'm hearing on the ground from talking to people, including many of you. what i was interested in the revision, the total number went up but the consumer spending number went down, and that's more consistent, more what i'm hearing. when i talk to businesses and

i'll be interested what you have to say in the group about cap x i'm not hearing the savage cut back in cap x you hear before recession. i'm hearing people investing through the cycle. that's business investment, that's what got marked up in the this revision. consumer spending i do hear consumers at the low end being stretched at the middle, trading down, at the high end they're, of course, still spending. i'm hearing that starting to pull back. that's more of what we saw with the revision this morning. >> i think it was interesting, tom, i guess it was a month ago you kind of took a break with the data and you said i see the strong data but i don't necessarily believe it. what are you expecting in this quarter? how much of a slow down do you think is going to happen with the economy? >> it's going to be a weird quarter from a reporting standpoint because it's christmas. the seasonality has all gotten messed up. if you remember last year, a strong october prime day, a week

november, december and then a very strong january. so when you look at the year over year with the black friday stuff you have to adjust for that because it's a different kind of stuff and covid messed up the seasonalities more broadly. but i'm hearing consumer slowing down. that's what i'm hearing. i'm not hearing consumer falling off the table. i'm hearing normalizing not recession but i am hearing consumers slowing down. >> is it all together, i mean, the consumer, business investment, government spending, enough of a slow down for you to believe we're on a tra salma tour to get inflation back down to the 2% target? >> i'm skeptical that price setters at this point have gone back to where they were precovid. one of the exercises i like to do in a group is to ask how many are back to pre-covid pricing levels? how many are actually reducing? and then how many are increasing?

i'll hear 50, 60%, a lot like you thought about the fed, 50 or 6% a 60% are saying we're still increasing at huer than pre-covid levels whether it be because of the costs faced, wages a part of it, or frankly because they can, and before covid i think 20, 30 years at 2% inflation, price setters had been disciplined to say, don't bring something outsized into this conversation. we don't have the ability to convince buyers to buy it. and that's been reinforced by globalization and the access to low cost content from other places, reinforced by ecommerce the ability to shop around, by powers like manufacturers and big box retailers to push back. and then, of course, in covid,

the huge cost pressure and supply chain outages meant you could do something and people passed them through. and so, you guys are all cfos. i don't know that people are going to give up that power until they have to. and there are people that have to. as i talk to people in apparel, that's clearly gone to the other side. but until you have to, it puts money to the bottom line faster. you know, there are costs that have to be recovered. i still hear people doing that. i think they're going to have to get convinced as somebody said before i started, i don't think 3.6% consumer spending growth is what convinces people they no longer have pricing power. >> tells you you could keep going. >> or give it a try. that's what i hear. >> go ahead. >> we've talked before. if you look at the major consumer products companies and maybe there are some here today. and you look at their price and volume numbers pre-covid, price up 1 to 2%, volume up 1 to 2%.

height of covid, price up 10%. and today prices up 12% volume down 3 to 4%. it's bold to say we're not going to try any more price increases but take on the 4% volume decrease. i don't see people doing it until they have to. >> interesting. what did barkin do before he was at the fed? maybe he was a cfo? >> i was. my successor is here somewhere and he's doing a better job. >> i'm sorry but you kind of kind of skirted the question, a little bit. it was a good answer. >> i was preparing to skirt some questions later sorry i skirted that one so quickly. >> don't think i'm not going to notice. >> i know. >> is it enough, the expectation of the slow down, to think you're back on the track for 2%

inflation? >> i'm skeptical. that doesn't mean it couldn't happen. if you dig into what's happening in inflation right now. people like to cut to three categories, goods and housing and then services and ex-housing. the goods is coming back. the spending on goods that happened during covid, you know, has come the other way and people who are pricing goods have clearly come down. and so, you're seeing lots of negatives and lots of categories that are offsetting positives. and net is back to pre-covid levels. housing is still elevated. there's a lot of people telling the story about how entry rents are coming down so therefore, it's just a matter of time before housing comes down. while i think entry rents have clearly come down versus where they were 18 months ago. i think they're still going up. you saw kay schiller yesterday, housing prices are still going up. that has a way to go on the housing side. and the services side, i don't

know who's gotten a property insurance bill in the last month that's not going down. there are a lot of other services i see still going up. largely driven by wages that are still going up in many of those categories. i'm skeptical. totally open to it it would be great if it did come down. but i'm in the looking to be convinced category rather than the convinced category. >> does that mean you're not willing to take another rate hike off the table? >> that's right. i think of this as a react to inflation strategy. if inflation comes down naturally and smoothly, awesome. no particular need to do anything with interest rates if inflation is coming down but if it flares back up you want the option of doing more on rates. i guess the bigger point is, there's no precision that anyone can point to at exactly what is the level of rates that exactly handles inflation in exactly the way you want to handle it. so you're constantly trying to

adjust on the fly as you learn more about the economy, as you learn more about the impact of demand on inflation, that's what we're learning as we go. >> one of your colleagues, fed governor chris waller yesterday, said if inflation keeps coming down we could cut rates next year. what's your opinion of that? >> it's a forecasting question. the markets and the fed have been having a forecasting battle, if i can put it this way, for 18 months. where the fed has done its best to tell a story where we think rates are going to go, based on a forecast of where the economy is going to do, and the markets have had a different view on that. so far i think -- i guess because we control rates we're still right on that. but i don't see it as there's a right or wrong answer on rates. i think there's different forecasts out there. and there's a forecast that looks like inflation comes down calmly and my skepticism is poorly placed. and in that case, sure, you

react to that. on the other hand, if you believe as i believe, that inflation is going to be stubborner than i would like it to be. then i think talking about reducing rates at this point is premature. >> does your forecast for next year at this point not include rate cuts? this. >> the good news is we get to do the forecast next week. >> right. >> so i'm upping my forecast next week. >> how about quietly a curtain raiser on that? >> yeah, no. >> all right. okay. very good. let me move on to this -- well, same notion. i'm going to come at the same question a different way. market has 100 basis points or more of rate cuts built in. is that a problem for you as a as a policy maker that the market is down here and you guys have at least the average for the september forecast is only . 2. >> so we make policy but really

only control the short rate. that policy flows through the economy and what we call financial conditions which include the rate curve and the reaction of the equity markets and the reaction of banks and their willingness to lend and all that stuff. so you do hope the messages you send go into the market the way you want to through these financial conditions. the problem is we don't really control financial conditions. as we've seen in the markets just in the last three months where you saw long rates increase significantly in the summer and come back down meaningfully over the last six weeks or so, they can jump around significantly. so i try pretty hard not to get overfocused on all that. because those things move around for reasons that include us but include other things. if you're in the market and you have a forecast for what you say four rate decreases next year? >> yeah. 100 basis points. >> first of all that's an average of a bunch of different

forecasts. so you have someone who thinks there's a deep recession and thinks there's eight, and then someone else who thinks there's one or two at the end. and i think if you look at the market inflation expectations over the last few weeks they've come down. and the market inflation expectations are consistent with a forecast that says no problem the fed has this under control, we're going to hit the soft landing beautifully. i hope they're right. >> on november 9th when you talked about how you cannot -- >> you've been listening to a conversation with thomas barkin and steve liesman, reiterating some views that we've heard in the last few weeks, guys, about needing more convincing to assume that inflation is going back down to target. it gives you a taste and flavor into what the next fed meeting in september is going to be like. there's those that feel good

that inflation is moving back to 2% target, wall zerer is one of those, and those that are still needing some more evidence and proof and needing more convincing and barkin is one of those,en though he's not a voter on the committee. but michelle bowman is as a governor and she built in another hike. he sounds like he might be in favor of another hike unless there's more proof that inflation is coming down. he looks at the commentary, the corporate commentary, what companies are doing on pricing. he was at the new york stock exchange a few weeks ago telling us, like us, he goes through the corporate commentary to figure out pricing and he's still convinced there's evidence of sticky inflation out there. >> as he said, if i'm wrong, that's great. be helpful. >> bostick has an essay saying

intelligence leaves me to believe that economic will be slow because tighter conditions are creating a greater restraint on economic activity probably more like waller than barkin. >> yes, he's dovish. he was one early out saying we've done enough. let the restrictive policy work through. i'm interested to hear from fed chair powell on friday because we will get key numbers from pce, core pce will be key and also on spending. and the question for powell is whether he, like waller, legitimizes the market's view right now, that inflation is going to come down and they look ahead to rate cuts or wants to talk a little tougher because they don't want financial conditions prematurely easing making their inflation fight harder. i think that's what surprised people about waller there wasn't any of the tough target and it

was a blessing for the market to keep doing what it's doing. >> what's the latest read in terms of the commentary we're getting as we continue to try to get a gauge on the consumer, sara. we did a lot of that yesterday coming out of cyber monday and black friday but we got some earnings as well this morning. anything catch your eye? >> the low end consumer is struggling. the dollar tree comments were relevant on that front. here's what we heard from the ceo of dollar tree. we experienced softening trends throughout the quarter, particularly in october as lower income consumers saw a notable pull back in spending. that tells you about the low end consumer. and foot locker which had been struggling with the low end, it was less bad than feared. they say they're see consumers respond to newness with a good

thanksgiving and black holiday season, while customers are discerning with dollars we expect it to continue we're also seeing them respond to newness. we're pleased as they respond to the holiday assortment and the compelling deals. i leave you with bun more thing on the consumer. we got a second look at the third quarter gdp we knew it was a good number 4.9 turns out it was better at 5.2%. but consumer spending was revised down 4.63%. it was driven by government spending and businesses and inventory. but there's still caution around the consumer that's not in that bad shape i think is the overall message. watching geor wat watching gm shares. phil lebeau joins us he talked to the ceo last hour has more

details. >> that stock move with general motors up so% because of the stock repurchase program. i think what's interesting when you look at the commentary about where the company stands in terms of its outlook and here's what she had to say, basically comes down to a few things. revising their 2023 guidance, not a dramatic change. essentially roughly inline with where they were, lower on the full year profit. they are lowering their crew spending by hundreds of millions of dollars, we'll get more details on that in the next couple of months and improve their ev execution, that came out in a conference call and when we talked with mary last hour, here's what she had to say. >> there was challenges with labor negotiations et cetera, they're behind us now, that gives us confidence in the business, confidence to do the asr at a $10 billion level and we'll move forward and execute

and move past the bumps in the road in the areas of autonomous and electrification. >> the asr she is talking about is gm's accelerated stock repurchase program announced this morning, $10 billion, $6.8 billion in shares immediately retired. that's about 17% of the outstanding shares out there. the company is increasing the dividend by 33% as you look at shares of general motors. it's important to point out during a conference call with analysts more than a few analysts and they asked tough questions they said you guys are still well below -- at least they were this morning, well below the ipo price of $33 a chair in 2010, what's it gonna take to do better? they know the uaw costs will increase by $9.3 billion, that came out in the conference call, that's the next four and a half years. but adam jonas put out a note a few minutes ago saying gm pivots

to more capital discipline, which is fantastic and then asked what's really changing? that's the question for the general motors the next several weeks. >> we'll learn a lot more in the next 24 hours too. thank you. as we go to break, the investing community warning warren buffett's right hand man, charlie younger who passed away yesterday at 99 years young. t mnte,sqwkn the street" returns after this.

remembering charlie munger, warren buffett's business partner for 65 years. he passed away yesterday at age 99, one month shy of his 100th birthday. our becky quick sat down with him a couple of weeks ago and she joins us with more. >> david, looking back and remembering charlie munger, it's tough to overstate his importance to berkshire hathaway. he was friends with warren buffett for 65 years. he didn't officially join as somebody involved as vice chairman until about 1978 but his input stretched back a lot longer than that. he's credited with expanding the way buffett thought about investments. instead of thinking about bad

businesses for cheap prices to picking up great businesses for fair prices. you all talked about that today. and two weeks ago i sat down with charlie to talk about his life and times. he was going to turn 100 on january 1st. and we were putting together a longer special report about his 100 years. during that time i got to talk to him a little bit about how he and warren buffett built berkshire into the company it is today. >> warren and i were starting with our little pidly start did we ever get to 100 billion, much less several hundred billion. >> what led to the success? >> we got a little less crazy than most people, a little less stupid than most people. that really helped us. in addition we were given a much longer time to run than most people because something kept us alive if this our 90s.

and that gave us a run from our little start to our 90s. those are the things that happened. and, of course, we wised up over time. we got into better and better companies. we understood more and more of the bad things that could happen. >> i think back in 2015 for the 50th anniversary of berkshire, you wrote in the shareholders letter that among many other things, you had a $60 billion pile of cash at that point. you thought that that pile of cash would decline over time because you'd be able to buy more and more things. now you have almost $160 billion in cash. is there an opportunity for a really big purchase with that? do you think you'll see one? >> of course, there's an opportunity for a purchase bigger than people can make. we have $160 billion in cash plus a great credit rating we

deserve. who in the hell has that? not have many. yes. but what it's going to be i can't tell you. it can't be anything too small because it doesn't matter how good it is. we're of a size now where too small doesn't move the needle very much. so we need something big to come along and use up all our cash and some borrowing. but who's more likely to find something than the guy who has 160 billion in cash plus a long history of buying bargains? i don't think it's hopeless. it may have to be done by some different people. you know next time we may not be able just to squeeze a little more lemon juice out of the old lemons but who can make them better than somebody who's

watched the early process all through all those years and seen how well it works and who starts with a little legacy of 160 billion of cash. >> so you're talking about greg able, jane. >> yes. >> ted and todd. >> or somebody not yet identified. >> charlie munger again passed away yesterday at the age of 99 just a month shy of his 100th birthday. but he was talking about the continuity of berkshire hathaway and how he thinks it's in strong hands. >> it's amazing he was so lucid and clear really until almost the very end. you interviewed him so many times and he's so quotable. i think you and a lot of people have been saying how candid he always was and sort of direct and to the point. i'm wondering if the there are any good ones you remember, highlights over the years, the comments and the statements? the i think of the crypto bashing for one. >> right. crypto bashing. there's so many of them.

there was a good reel put together by one of the hedge funds circulating on x since last night. there are so many one liners you candidate possibly go back and remember these. but that's the thing, he cut t to the chase quickly. he found a great way of taking something and boiling it down. didn't like excess, didn't like greed. he talked a lot about how law was a very good thing for civilization, in terms of making sure you're not envious, you don't steal, cheat, all kinds of things that he really believed needed to be standards for business and a lot of times we talked about him as the moral authority not just berkshire hathaway but business at large. >> we mentioned at the outset, of course, a 65 year partnership between munger and buffett, just truly extraordinary and one of the great partnerships in the history of business, i guess. they never have a fight they say is that true? >> that's what both of them repeatedly said.

i believe it because they would remember if they ever did have harsh words. it's not that they never disagreed but they never were r rank rouse in days agreement. charlie would say warren you're right i'm smart, so you would come away to my way of thinking. and that's something that he would call out to him. and warren could call charlie the abombinal no man. every time i spoke to either one of them, they tried to give the lion's share of credit to the other one. that's a remarkable thing in a long partnership and friendship, and something all of us would aspire to having someone like that in your life. >> it was a great line. eventually you'll agree with me because i'm smart and you're right.

>> it's a great retrospective becky, thank you. "squawk on the street" is back after this. -thanks for swinging by, carl. -no problem. so what are all those for? uh, this lets me adjust the base, add more guitar, maybe some drums. -wow. so many choices. -yeah. like schwab. i can get full service wealth management, advice, invest on my own, and trade on thinkorswim. you know carl is the only front man you need. (phone rings) oh, i gotta take this, carl. it's schwab. schwab. (feedback rings) have a choice in how you invest with schwab. (vo) this is more than just a building. have a choice in how you invest it's billion-dollar views. perfectly located. an inspiration. and enough space to start an empire. loopnet. the most popular place to find a space.

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welcome back to "squawk on the street" i'm silvana henao with your cnbc news update. negotiations are under way to extend the israel/hamas cease-fire ahead of tonight's deadline. a senior diplomat told nbc news the expected extension is for at least two days. the new deal would secure the release of more hostages and palestinian prisoners. the cia director and head of israel's intelligence community are in qatar as negotiations continue. federal mead diators rejecta request by american flight attendants that would allow them to go on strike by the end of the year. putting worries over disrupted holiday travel at ease. the union is asking for a 35% pay bump because flight attendants have not received raises since 2019. and winter is making its way into the northeast. more than 40 inches of snow fell

over the past two days covering parts of the great lakes and the northeast. the first lake effect snow event of the season will continue today with upstate new york expected to see 1 to 2 inches of snow per hour guys. back to you. >> yeah, it was cold this morning. >> very. >> silvana, thank you. keeping an ya on shares of phillips 66. the shares are up about 3%, it had been higher this morning. this follows my report that elliott management has taken a billion dollar stake in the fuel refiner and looking to add two new directors to the company's board. t the. in a letter out a bit ago, operating expenses per barrel versus bepeers as a key reason r the involvement here saying phillips has shaken investor's

thoughts it could run efficiently. it's under plan to target 14 billion mid cycle ebitda. elliott goes on to say that while that is admirable, there's skepticism about the company's ability to achieve those goals and that remains a weight on its stock price. hence they believe that success in large part will depend on oversight capabilities that require elliott to nominate two members for the company's board. they're no stranger to the area. many years ago i can remember the battle for board seats at hess. of course, the underlying commodity plays as big a role as any activist can do. and there's another template they're following where they got involved and will argue they have been beneficial in terms of you see marathon stock price which has outperformed both

phillips and valero over the last five years. >> does it hint at more consolidation in the energy space or no? >> it's not clear that consolidation is the key to the thesis as much as it is execution in terms of getting the op exdown per barrel refined. >> what's elliott's track record lately. are you surprised the stock is not up more on this news? >> not necessarily. the track record is okay. it's okay. it depends on the situation like so many others. and as i said, sometimes there are obviously things far beyond the control of the activists that come into play here. we'll see the whether they do follow through. the nominating window opens in jan, feb, for many companies and, in fact, we expect to see more potential activism given where we are in the calendar. >> we'll watch that one, it's a good one. we have lost some steam here.

opening highs have been mostly lost on the dow. coming up jensen huang live omfr the "the new york times" deal book. we'll take you live when that happens. stay with us.

(♪ music ♪) the walking tree is said to change its entire location in pursuit of sunlight (♪ ♪) where could reinvention take your business? accenture. let there be change.

welcome back to "squawk on the street." azek shares are up 60% on the year after delivering strong fourth quarter results driven by residential sales and margin execution. we're joined by the ceo jesse singh for a first on cnbc interview. there's a lot of doom and gloom yet you continue to grow in the housing environment. >> we take recycle material for things like composite decking and through our temper tech brand. i think the key is we focus on

consumers that are living in their houses, not transacting. so what you see is a really strong focus on the house. it's continued the last decade, especially around our outdoor spaces and consumers are continuing to invest in improving their homes. i think the key here also is that the demographic that we are serving they own their own homes, have home equity and stock appreciation and employment. >> is it because they're not buying new homes because mortgage rates are so high they're reinvesting in their own homes that it's benefitting you is that the cycle we're in? >> it's part of it. i think you have to put things in perspective. our types of homes, there's 60 to 70 million homes with decks on them and other types of exterior materials. if you think about a transactional models of new

sales on construction that's only about a million. so you always had this tendency for people to invest in their homes outside of transactions. certainly as people stay in their homes longer, it gives our brands an opportunity to continue to service them. we're able to provide people additional outdoor square footage at a lower cost than new construction or indoor enclosed remodel. >> it's interesting because the guidance and commentary from home depot and lowe's lately has been softness in the do it yourself portion. is it not correlated with that? >> i think the most important thing if you parse out what the other folks have said, what they have said is that the pro continues to be strong. and that remodelling sector that is serviced by a pro continues to be strong. and we're certainly in that sector which is where the vast

majority of our business is. people continue to go out and engage contractors and continue to do the work on their homes. i think that segment has shown resiliency over a long period of time. and right now we're -- our guide for next year conservatively is five percentage points growth midpoint and we think there's an opportunity to do better than that moving into next year. >> there's work being done right now, looking ahead a few years to what is going to be a big generational transfer of wealth within housing as boomers retire, down size, sell, or pass their homes to their kids. i wonder what you think that does to the do it yourself remodelling dynamic? >> i think longer term we're in a terrific market segment. not only diy, repair and remodel, ours specifically, it gets to the trends you're talking about. there's a shortage of homes, an

existing generation of millennials that need to move in and wealth transfer. and the stock of homes is 40 years plus. so if you add all of that up, there is meaningful pent up demand that needs to be serviced. we'll work our way through whatever economic uncertainty is there, but the long-term thesis for the market is terrific. for us we're replacing wood. the vast majority of what we're doing is selling and upgrading wood types of applications on the outside of homes. >> apparently alternative wood has been taking share from wood for a while. which is helping. thank you for the deep dive we appreciate it. >> really appreciate it. thanks for having me on. coming up at 11:00, ceo of intuit beating revenues up to n % he'll join us to break dow the trends next hour. don't go anywhere. [van engine] (♪♪) [card reader chimes]

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nvidia's jensen huang speaking at deal book with andrew ross sorkin. let's listen in. >> back in 1993, over breakfast, at denny's with two friends. since then as ceo he's led nvidia to become the world's

most valuable semiconductor company. nvidia stock has been on a tear up 240% this year, reaching a trillion dollar market cap. we're so grateful to have you here today as we all try to make sense of what is happening in the world of a.i. i think in so many ways you saw this first. so, i'm hoping to start with this. i said you power what open a.i. and chatgpt has been. we've been reading about open a.i. and the tre vails inside that company and the nonprofit and talk about the governance issues as well. but you delivered, i think this is back -- i don't know what year we're talking about now. but you delivered the first box, the first chips to elon musk who was one of the founders of open a.i. only a couple years ago. what happened? >> well, i delivered to him the first a.i. supercomputer the

world ever made. it took us five years to make it, it's called a dgx, it's everywhere in the world today. people think we build gpus. but this gpu is 70 pounds, 35,000 parts. out of the 35,000, eight of the chips come from tsmc. it is so heavy you need rebots to build it. it consumes 10,000 amps. it's like an electric car. we sell it for $250,000. it's a supercomputer so it takes another supercomputer to test it. this is a computer first of its kind. we started working on it in 2012, took me five years to build it. at first i built it for our own engineers and i spoke about it at a conference and elon saw it and he goes, i want one of those. he told me about open a.i. also knew peter biel, who was a

berkeley professor, one of the early people at open a.i., and i met him during the alex net days five years earlier. >> he's involved in the drama we've been reading about. >> anyway, i delivered the world first a.i. supercomputer on that day. and people took pictures of it. it's on the internet somewhere. >> when you did that and you said you didn't do it originally for him. what was it, though, that you saw at that point? five years before you even delivered it? >> in 2012 when this all first started, first happened, alex net did something remarkable. here's a kneuro network, the wa to program it was to show it the results you wanted. which was backwards in programs up to them. prior to that, it was engineers sit down and you where software

and you test it to see if it produced the outputs you wanted. but here you showed it examples and you -- you taught it. what outputs you wanted. what outputs to expect. so when we first saw the results of it, alex net. results were so spectacular that alex and jeffrey hinton, they achieved results of computer vision recognition that no computer vision expert were able to achieve before that. the first observation is how remarkable it was, but we were fortunate enough to take a step back and ask ourselves, what is the implication of this to the future of computers. and we drew the right conclusions, that this was going to change the way computing was going to be done. this was going to change the way software was going to be written. and this was going to change the

type of applications we could write. >> was there any part of you that was scared when all of this happened? you just mentioned two names, george hinton, and elia, and by the way, those are names, if you've been following what's happening, they have been very outspoken about the dangers of ai, very -- i want to get into what you think happened at openai in the past couple of weeks, but it may very well be that there may have been a new step change in terms of what this technology was, but was there ever part of you that says, oh, my goodness, not only are we on the cusp of a r revolution in a great way, but that this is dangerous. >> 12 years, nobody expected the results that we would get. and anybody who would have said so back nthen would have overexaggerated our understanding of the rate of progress. there's no question that the rate of progress is high. and what we realized today is

that, of course, of course, what we can do today with these models and intelligence are related, but not the same. we're very good at perception today, and we're very good at those one-shot knee-jerk reaction. i recognize that that's a dog. i can finish that sentence. but there's a whole bunch of things that we cann't do yet. we can't reason yet. this multi-step reasoning that humans are very good at, ai can't do that. >> and how far do you think we are away from that? >> we'll see. we'll see. i think that just about everybody's working on it. and all the researchers are working on it. everybody's working on it. we're trying to figure out, how do you take a goal, break it down into a whole bunch of steps and create a decision tree and walk down the decision tree to figure out which one of the paths leads to the most optimal answer. this is how we reason through things, how we it rerate througa

problem. >> you're making bets on where we're going to be five years from now. >> ten years from now. so people talk about agi, right? artificial general intelligence. do you think ten years from now, we are there? >> by -- depending on how you define it, i think the answer is "yes." so the question is, what is agi? if we define agi as a piece of software, a computer that can take a whole bunch of tests and these tests reflect basic intelligence, and by achieving -- by completing those tests, deliver results that are fairly competitive to a normal human, i would say that within the next five years, you're going to see obviously ais that can achieve those tests. >> and design the chips you're making right now? >> yeah, yeah. >> will you need to have the

same staff that designs them? >> none of our chips are possible today without ai. literally, the h-100s we're shipping today were designed with a lot of the assistance of ai. otherwise, we wouldn't be able to optimize the algorithms to the levels we have. software can't be written without ai, chips can't be designed without ai. nothing's possible. >> we started talking about open ai, what did you make of what happened? the ousting of sam altman and the return of sam altman. all of it? >> first of all, i'm happy that they're settled. and i hope they're settled. it was a really great team. and they're doing important work. and they've achieved great results. and i'm just really happy that they're settled. you know, also, it also brings to mind the importance of corporate governance. nvidia's here 30 years after our founding. we've gone through a lot offed a

ve adversity. if we didn't set up our company properly, who knows what would have done. so i think when you're architecting an industry, you know, you want to apply some of that wisdom to what architecting a company. and so, i'm really proud of nvidia's corporate governance, by the way. and if not for the architecture that we established when i was 29 years old, it would be kind of -- >> you're a for-profit company, though. what's so interesting about this sort of dynamic is that that is a firm that is effectively operated from a governance perspective as a not-for-profit. and they did think it was dangerous. elon musk said it was dangerous. so the question is, in the sort of multitude of these different businesses that are in ai, do you think you do need th these not-for-profits do you think the incentive system is just fundamentally off and should be a for-profit? a lot of people now think that the capitalists have taken over? >> well, regulators are

not-for-profit. and we should regulate these. first of all, just take a step back and think about what ai. ai is an autonomous system. it's an autonomous system that's more -- it's an autonomous information system. we have a lot of autonomous systems today. self-driving cars in factories within factories that already exist. robots are autonomous. planes are autonomous. auto-pilots, self-landing. all of those capabilities exist. we ought to make sure that we apply the first principles of autonomous systems in the same way. we have to design it properly, test it properly, stress test it properly, monitor it. there's inside-out safety, there's outside-in safety. the faa, flight air traffic control redundancy, adversity. there's a whole bunch of different systems that we have to put in place for autonomous systems. there's a lot of industries to learn from. >> at the beginning of this, i

mentioned there was a frenemy situation going on with a lot of companies that use your chips. they're desperate for your chips. they want your gpus and at the same time they're also trying to build their own, frankly. i'm curious since you've seen it all, how you would stack rank the success of the various companies that are in this ai space? we have somebody from google deep minus here today. their coo. i'm curious where you think open ai ranks in that. there's inflection, amazon is trying to -- >> i'm not going to rank my friends. >> but you have a sense of -- and part of the question -- >> i'll admit it, i want to, but i'm not going to do it. >> just kidding. >> but there is a question about actually whether all of these things converge. meaning that they all -- does this all become some sort of commoditized business? >> no, i don't think so. i don't think so. i think what's going to happen, we're going to have off-the-shelf ais, and these

will be really, really good at solving a lot of problems. but you're going to have companies in health care will have supervised, super-tuned ais that take these off the shelf ais and make them super good at drug discovery or super good at ship design. the vast majority of our companies' value is in the data and the intelligence and the know-how, the craft that's inside our company. and none of that data is out on the internet. you can't get an ai to go learn it. i've got to take a really smart ai, which is what we do. we build a smart ai and teach it how to design chips and write software, we teach it how to do drug discovery. we'll teach it how to do radiology. >> let me ask you a geopolitical question. we'll hear from the president of taiwan just after this. and there is a big debate, as you know, about chip independence, the big investment that we're making in chips to manufacture here in the united states. whether we should be exporting certain types of chips to china.

where are we on the journey of being chip independent, if you will? and do you think that that is a worthy goal? >> we are -- we are somewhere between a decade to two decades away from supply chain independence. as i mentioned earlier, our system comes to 35,000 parts, and eight of them come from tsmc. and the supply chain -- >> and they're in taiwan, of course. >> there are a lot in taiwan, they're all over the world, but supply chain independence is going to be really challenging, yeah. we should try it, we should endeavor it. i mean, we should absolutely go down the journey of it. but total independence of supply chain is not a real practical thing for a decade or two. >> one of the other thing that's happening, as you know so well, is that the u.s. government has effectively told you, you need to throttle the speed of the chips that you are exporting to china. >> yeah. >> this is having an impact on

the business itself, but i'm curious how you think about that, also, geopolitically as a business, the national security concerns, jamie dimon, we were talking earlier about, you know, what companies you should do business with. should you do business with people in china or not. given all of the concerns that people have? >> we'll keep you posted on headlines. i'm carl quintanilla with sara eisen. you have been listening to the nvidia ceo live at "the new york times" deal book conference. obviously, a lot to get to regarding ai and geopolitics. we'll have a lot more on his comments ahead this hour. first, three rate cuts in 2024. deutsche's ceo of the americas lays out where monetary policy is going and what it means for your money. >> then, apple and gulf coast gulf goldman sachs, a look inside apple's effort to unwind its credit card partnerships. >> and what's the impact of ai might have on its revenue growth? we'll discuss. >> first up on the markets, looks like the rally carries on.