141 points higher on the dow. nasdaq looking to open 20 points higher and the s&p 25 points. the treasury boards what's happening here i think is the speculation we'll get a 50 basis point cut. >> i want to know what fed futures moved on the retail number now it's back to 25. >> 25 yeah. >> but the market is up can the market -- >> join us tomorrow to find out the answer. well, the next day you'll find out the real answer. we'll be back tomorrow. "squawk on the street" begins right now. good tuesday morning. welcome to "squawk on the street." i'm carl quintanilla with david faber at post nine of the new york stock exchange. cramer is at one market in san francisco, dreamforce kicks off today. s&p looks to take aim at some record highs at the open following the dow's all-time high yesterday. retail sales solid. fed meeting begins. plenty of mag seven news from microsoft to meta to amazon. our road map begins with the fed

decision, though, just a day away as the street debates how deep of a cut to expect. >> on the tech front shares of intel up sharply in the premarket. lots of developments surrounding the company including its agreement to propose deuce ai chips for amazon web services. microsoft announces a dividend hike, stock repurchase, up to $60 billion in buybacks. >> let's start with the markets. s&p is riding a six-day win streak ahead of the fed's decision tomorrow. jim, in futures here, look a little spicy. >> right. we know the industrials have had a little bit of a run. the banks have been okay. health care is all right. these were all -- today and friday, but this, look, yesterday, but this looks like today we're setting up maybe perhaps because of the microsoft buyback, a very good tone as we remember these companies have a lot of power and have a lot of money. david, when you see a usual dividend boost, but a gigantic buyback, don't you think, wait a

second, they can buyback $60 billion, isn't that bigger than most companies? that does create a level of confidence. >> buyback $60 billion and their capex, in the $50 billion plus at least. listen, i mean the numbers are extraordinary. i pointed out i'm like a broken record around earnings every time because i'm so wowed by the -- just the numbers themselves, jim. we make the point and it is worth making these companies, the enormity of their balance sheets, their capital structures, of their broad power so to speak, despite the fact that they may not be violating any anti-monopoly laws, is extraordinary. and really unlike anything i think we've ever seen, at least in our lifetime. >> yes. take a look at alphabet. now, i'm seeing waymo cars all over san francisco. we know that they've got deals to do other cities. and yet, what are we hearing? they've been a monopolist when

it comes to advertising. carl, some companies are so powerful and tentacles everywhere, an apple that the stock trades below a market multiple, people worry about the government, these companies are in the cross hairs of the government. they're just bigger than countries and you can't take them on if you're in their bali wick >> speaking of autonomous driving you saw the bernstein note today they argue if it hadn't been for gen ai we might talk about this year as the year autonomous driving turned a corner, waymo rides going in a short period of time, cruz is testing again, we talked about the uber expansion to atlanta the other day. look, when i think about what's going on in san francisco and then these other cities i begin to see the possibility i'm going to see this today when i'm at dreamforce which is salesforce's wonderful extravaganza for ai, the cars and buss that don't have steering wheels. that's the future. they look like mini busses and

then, david, you don't have this oddity of someone not behind the wheel, so you feel like wait a second, where is the driver? that's over, and i'm seeing these as being the next step when it comes to driverless. >> yeah. it's an interesting and a long piece from your good friend tony sag nagy. you're going to read that with great interest. tesla we pointed out many times has been a big beneficiary as well in terms of how it's training its self-driving in terms of generative ai and the advance made as well. we talked to dara last week about austin being one of their key markets as they partner with waymo. we'll keep an eye on both of those shares. you know, jim, back to broader market and again, as we pointed out yesterday a number of times, the very strong market last week, preceded the week prior by the very weak market, any takeaways from the trading yesterday in terms of how this week is going to go with this

fed decision, of course sitting right in the middle of it? >> it's pretty amazing. we've got two markets. the 50 basis points markets and that moves all the housing relate and banks and 25 brings back the nation state tech titans. it's almost as if, carl, people think, well if you do 50 you've saved the market and saved a lot of the industrials and the cy cyclicals. if you only do 25 you hurt them go back to companies that have big balance sheets doing so well, that won't be hurt by a recession. and that's tech. very binary and stupid. >> meantime, jim, canada today printed 2% inflation. 2.0 year on year. estimate was 2.1. they got to target. >> yeah. but i come back and listen to phil lebeau and he's talking about the biggest expense for a lot of people is the auto expense and it's more than $700 a month, and it lags. i'm trying to find -- i'm on the

war path to find where people save more money, maybe home equity loan. it is not a case on this particular cut that the consumer is stimulated and that, david, is where the weakness is in the economy. >> it is at this point if you want to call it weakness. as we pointed out savings is still 30% above where it was in 2019 prior to the pandemic. there would be a decent amount of cushion. you're right, the things we look at the fed looks at indicate a consumer starting to weaken. but you know, it's funny, jim, as much as we get 50-25, i had a conversation yesterday with somebody who's very senior in the world of finance, who said, i don't know why we're cutting at all. there is the camp that says the economy is stronger than we're giving it credit for, and we're going to, you know, we're -- we're going to expend the bullets that would otherwise be best kept in case things did get

really bad. >> it's funny. i talked to a number of ceos, not just the ones who were on yesterday, the number last, and nobody could figure out, again, you're so right, nobody could figure out why we need this. they're still trying to find employees, engineers, a shortage. carl, two economies. there's the economy that is frantic to try to find people who know ai. and then there's the other economy which needs more than ai to put up the numbers. we have two different economies and when you're out here, look, we're back in the bidding wars for talent out here. >> what have you picked up, jim? you had great interviews last night. we'll play great experts from tan or rene haas. what's the chatter given our endless conversation about ai and, you know, i would assume it's the same out there? >> it's about who needs jensen and who doesn't. i mean, if you need jensen you're in trouble and you're worried about allocation.

if you don't need jensen, you know what, then you have a pretty good run of the place. hock tan does not need jensen huang. he does not need to make it so that he gets blackwell. but david, we keep thinking about the piece you ran yesterday. we had larry ellison talk about how he needs to get right with jensen. that is the real subject of discussion. oracle's resurgence from a 2% grower to something far bigger. why? they've got it right with jensen. >> yeah. ellison now number two on the world's richest list. dethrones bezos, catching up to elon musk. oracle up 20% in a month will help that. intel, stock getting a boost on news it's creating a separate entity for its foundry business that could allow it to raise outside funding and the company expanding a partnership with amazon which now includes developing ai chips for aws. this is pat gelsinger on

"closing bell: overtime" yesterday. >> this is a big announcement today. amazon a partner of intel many years but we've taken it to a whole new level. obviously, the 18-a foundry agreement fort ai networking is a big deal, and amazon is a discerning customer. they are, you know, really sent us through our paces to prove that it was up to snuff and it's up to snuff. >> jim, can't say the sell side is all that enthused today. jpm and bofa maintain an underweight. >> a couple things going on. the chip was probably going to be produced for amazon anyway, so why should they have to announce an agreement. the question is how exclusive? will they be able to sell it to others? two, one of the things i was concerned about, i talked about intel yesterday, the cash outflow. they paused germany and paused poland. that's going to save them some money. all that said, what i do think is important, is that they have their own foundry system and they broke out foundry as if

there could be a sum of the parts situation if, david, the sum of the parts is being put between 40 and 42. so that is tantalizing to people, but no one else knows why they split the foundry business off other than try to make it for sell some day. >> listen, you've been, and rightly so, skeptical for a very long time. i gave you a hard time yesterday about any number of names. on this one, jim, off been right all the way down. you've been concerned lately in terms of cash, and i would go to stacy razkin, the ax in this industry and we have him on often, on the positive the moves to intel is not as desperate for cash as some feared. they don't seem to be preparing to dumble mobile ai at the bottom and the opex cuts, subsidies and partner contributions they should be okay for now. >> i like that "okay for now."

they got money from the government and get grants and the balance sheet is going to get an infusion. if you were in germany or poland, there was great fanfare for the german plant that is now paused. to me you have pause and then you have a lot of people in germany talking about mothball, that they won't be made. so look, i think, carl, when i look at the company it reminds me when amd and global foundry split off. i'm wondering whether we're just seeing a continual reshuffling of the -- of what they have, the assets they have, in order to make it so the balance sheet is fine. the balance sheet being fine needs to see a lot less cash out and that's what happened in germany. even though they promised europe the plants. >> yeah. we're beginning to see pieces here this morning, jim, the case to buy the dip. i don't think you're quite there yet. >> we don't have to sell the surge. >> yeah. meanwhile, speaking of aws and

amazon we did get the memo from andy jassy yesterday telling employees to return five days a week. kind of takes me back, jim, i think it was '21 when he came on and talked about sort of the stitching, the glue, among employees that you lose when you try to innovate remote. >> one of the things that was -- this was incredible he talked about at dreamforce, is andy jassy is uniformly known as a real good guy. kept a lot of people on after the pandemic until they could figure out who should be laid off. this decision, some people are saying is a shakeout. he wants to find out who is truly committed and who isn't, even though there are people already grandfathered. you know what, david a lot of people out here are convinced that remote is better than going to work, and i think that's a cop out because if you want to try to rationalize and make your workforce have mentors and people who can figure out what to do and teach younger people,

it's hard by zoom. >> listen, paying attention to our dialog for the last four years, know how i feel and i believe how you feel and even carl as well. i don't understand it. i've never understood it. i don't know how you get an organization to move in the same direction. i don't know how you get a sense of urgency amongst your employee base without being together on a very regular basis. and i guess andy jassy agrees. to carl's point it is a way, jim, of weeding people out without announcing layoffs, so to speak, saying all right, maybe this is just not right for you if you can't make it into the office. >> yeah. one of the things made me laugh about this, amazon is uniquely a company where you have to be face to face. i mean what they do for a living is to try to get a package to you, and i think, therefore, if you have all these people at home -- i never call for people to be just fired -- you have all these people at home perhaps

there are sur pur few lus people, if anybody is going to figure out ai and who needs to be human and who can be an agent, it's going to be amazon. i wonder if that isn't next. trying to figure out who -- by the way, everyone is trying to figure out they're expendable out here. maybe i'm expendable. hey -- some of them -- some are like you are not expendable because you have a face. so there are a lot of people questioning it. a lot of existential questioning out here. >> you have a lot of young companies, companies just starting, that don't really have a physical presence to a certain extent, in part because it does save money early on to have your employees distributed wherever you want them working from home. it's a weird way to do it, especially for younger people. any number of younger people who are working for companies, that they're remote. it's the company culture to be remote. i don't know how that figures into how venture capitalists think about those companies and their future?

>> there's a bidding war for talent. people are looking and thinking you know what, woe is me. we've got -- slow down in consumer spending. there are people who can't make their car payments. but then, carl, you've got a lot of people still being in a bidding war. how great is you can say listen, i want to stay at home, but you got to hire me. and the companies tend to cede to that because there's not enough qualified people out here. >> amazon calls this the year of efficiency, my term not jassy's, but appropriate given amazon middle managers are going to be laid off in the coming months and say, buy amazon. >> look -- i -- there are agencies, the keyword out here. agency means you allow the ai agent to be able to make decisions themselves. now, david, i know that you think that maybe ai decision maker might say you know what, we're going to set the world on fire or something, but the

machines tend to do what's the right thing to do. >> until they don't. i mean, jim, i assume you're having those conversations still, off-line perhaps, about the concerns that the people behind the technology continue to have because when you do sit down with them in quiet places and get them to actually talk, perhaps after a couple drinks, they will all admit they're still very much afraid. they will. >> you're right. i mean i'm being facetious when i make faces but that's what i do when i'm with you, why not do it 3,000 miles away. a lot of people are saying are good guys going to get it or bad guys going doto get it? there are views bad guys are going to get it and how to keep it from the bad guys. that's another discussion out here. >> indeed, jim. we got retail sales this morning. next up is industrial production and for that i think we're going to head to rick santelli. hey, rick. >> hi, carl. indeed, another surprise of

strength. industrial production expected up 0.2. multiply that by 4, up .8%. last month being the second weakest number of the year revised to minus .9, down almost 1%. the second best number of the year. capacity utilization, also better than expected at 78%. sequentially higher than the 77.4 in the rearview mirror, and that 77.4 was a downward revision, just like industrial production. so last month, a bit weaker. this month significantly stronger, especially on i.p. and that's an august number. we did see retail sales better than expected and empire, we saw yesterday was well a strong number and that's september. there seems to be a better pulse on some of the manufacturing areas of the economy, and if we

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time for a mad dash. cross country version. we of course have an opening bell six minutes from now. nucore reported earnings. what do we think? >> they give you the prelim which tells you what's going to happen when they actually get to the end of the quarter, and, david, it's not good. the reason, i'm looking for weakness. i don't find any out here. we learned that nucore is probably going to earn 1.30 to 1.40 this quarter. we had been looking for 1.89. the reason for the shortfall, lower volumes and lower average selling price. david, this is where there is weakness in steel. and we know, by the way, if you look at the chart of cleveland cliffs, it's been dreadful.

so if you want weakness and want to find it, steel will tell where you why it is. >> what's the takeaway here then? again, given this guidance range is deeply below estimates as you just pointed out? >> well, there's two. look, you could go with what cleveland cliffs is saying, which is that it's an invasion of chinese steel through mexico, and it's not being policed by our government. or you could say maybe autos and construction are weaker than we thought. those are two steel markets. although, by the way, it's really -- you could say it's cleveland cliffs that dominates the autos. when you see this kind of wholesale decline in average selling price, what that means is there's just not a lot of demand, not necessarily that there's a plethora of supply. >> interesting. all right. keep an eye on shares of u.s. steel as well. some of the others that you mentioned. cleveland cliffs. we'll see you in a minute. we have the openbeing ll a few minutes away. minutes away. don't go anywhere.

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this is a market for accelerators and the networking. these are the guys who are investing in today hundred thousand gpu or xpu clusters in four years time, they're headed towards a million. >> and you -- >> clusters -- >> that's broadcom's hock tan with jim on "mad money." he gave you a nice road map for the incentive, these hyper scalers have to invest. >> well, look, i thought it was great. hock usually is not as effusive and one of the things that's most important if you do the million, you know, what you're saying is that larry ellison is probably going to be right, you are going to need 1,000 data centers not 162. we're trying to figure out whether ellis is an outlier. you speak to hock tan who is not given to hyperbole, but he's saying look out, we haven't gotten near the peak spending. i thought that was significant because you know hock tan, he

doesn't exaggerate. i think the number, by the way, that he reported did not take too the fact all the billings from the hyper scalers. >> let's get the opening bell here on the cnbc real-time exchange on the big board. american eagle outfitters celebrating its 30th listing anniversary at the nasdaq. data dog, a monitoring and security platform for cloud applications. 10, 15 points shy of a record s&p. >> look, if we had technology on board, technology is such a unique part of the s&p it's going to happen. but you do need tech. one of the things i'm focused on, maybe it's going to 30% because of ai. if you're out here and you don't hear ai immediately you tend to think basically you're with the wrong person. if you're trying to make chit

chat and jensen huang doesn't come up, david, i really think maybe you're an imposter and shouldn't be in the room. >> right. it's the old, yeah, the old line, right "verb noun ai." that's what you got to go with. >> true. >> yeah. >> look, everyone's trying to figure out a use case. one thing that's intimidating, carl, the only use cases that you find are ones you don't understand because they're so complex and difficult. i'm not finding anything easy. we discussed last night at a time 100 dinner, curing cancer and ai and how that's not what happens. but you can speed up an accumulation of data and figure out which gene might be causing cancer. that has been one use i found that people are talking about. the other ones are just trying to figure out how to make it so your call center is smaller, not the holy grail of ai computing. >> you know, jim, we mentioned

the microsoft div hike and buyback, but didn't discuss the copilot launch of these agents and nadella's discussion of what it can do for your e-mail, what it can do for your excel spreadsheets and some of these license buyers include honeywell and vodafone. >> this is huge because there is a battle going on. it's happening. which is microsoft against salesforce. the force has a product that they're unveiling today that we've gotten wind of, of course, about their agency plan about smart bots, about the big changes that they see happening, but it's to compete against microsoft. not a lot of love loss right now. david, you know that this has been brewing, microsoft versus salesforce. microsoft has opened what it's going to do for 365 and the salvo back from salesforce is, ai copilot not doing the job

that you think it is. >> yeah. i mean, i would assume we're going to start to see, as, again, we get deeper into the applications, particularly from the enterprise, jim, more of these types of potential battles. >> oh, i think it's true. >> and it does speak to microsoft's growing ubiquity in some ways, doesn't it, they are going to be -- they're challenging the likes of a salesforce or any number of other companies in terms of offering these tools to corporations. >> well, look, it's the same thing with cyber security. they are the big dog in cyber security. nobody else is. >> yeah. >> look, we talk about crowdstrike and palo alto. but the people who are trying to make big decisions, it's detackto that microsoft is going to be their security blanket. i don't think anyone is happy with that because they wanted to have more choice, but that's with they're with.

microsoft 365, cyber security. microsoft wants 100% of your business. it's not talked about. by the way, david, it's amazing, the justice department doesn't seem to look at them at all. >> look at them at all, no, you're right, the one name that escapes some significant scrutiny, i guess. we have to go through the list in terms of, obviously, alphabet has got one case, they're in a different part of it, and then they've got the advertising. meta, still in the cross hairs. amazon, yes. you're right. microsoft is the one. apple as well. is scrutinized a lot more in the eu, than seems to be the case here in terms of some of their practices. >> right. look, i think microsoft is able to bundle. now bundle is often a term that the justice department is interested in. let's say you take 365 and they say, listen, why don't you take this, this, this. that's not monopolistic behavior. we're offering you a better deal

than others. the question is, is their product better than others? does 365 hallucinate? does it send you to the wrong place? there are a lot of people who are saying things that are just outright critical, but carl, this is because there is a war going on. it's between the companies that are alive with salesforce and the companies that are alive with microsoft. >> yeah. kind of like a boeing air bus kind of -- i don't want to say duopoly in this case, but people picking their teams. meta is a lot closer to an all-time high today than microsoft and we did get news from meta today that they're going to institute some sweeping changes on instagram regarding teen using and then, of course, ban something russian state media, rt and others, from platforms as well. >> here's an insanity i've discovered -- i'm talking to a huge number of executives.

mike mark zuckerberg interested to be the paragon. he's forward, ahead of the issues. david is it possible that mark zuckerberg has some sort of [ inaudible ] to mass this conversion. is he considered to be the leader when it comes to the safeguards and what has to happen with ai. >> yeah. i'll leave that to you. i guess he wears a nice little chain now and grew his hair out and it's all kumbaya? it's all changed. >> you're right. it's just one big $50 billion phony. you're right. you nailed him, david. you got right to the heart of things. otherwise, the fact that he's become the leader, but you're right, carl, david's right, he's -- david's more focused on the necklace. >> well, i think a lot of people are, of course. the -- >> mesmerizing, david. ear pierce. >> llama is open source and they've gotten -- they get criticized in some ways for it and as well they also are -- >> who is criticizing them?

people using it. who are criticizing them? >> to your point earlier when you make it available to everybody, it is also available to those who might do things that are not necessarily in the best interest of society. that's why. >> the bad guys. >> correct. the bad guys. yes. there are plenty of them as you well know. >> you and i agree there are bad guys. you know, carl, you can't stop them. everyone -- by the way, it's funny, everyone says, hey, it's always in -- it's in the good guys. the good guys have it. the bad guys can't get it. why can't the bad guys get it? it's for free. >> they get it. they have it. and conceivably they will do bad things with it, which is something we always need to be concerned about. it will just be an escalating war. you're in the going to prevent it, jim. >> no. >> changing subjects a bit, i did notice apple shares have continued their decline. yesterday the stock was down on a number of analysts weighing in terms of preorders being a bit below what had been anticipated or what we've seen in previous

launches. jim, i don't know what your thoughts are. the stock is unperformed now, under performed for the year, down -- excuse me up a little less than 12%, but well below the 18.5% return of the s&p. >> well, david, you said something yesterday and i think it's dawning on people. 32 times earning for a company that doesn't have the product, the demand that we thought. i'm going to talk to mike see ver from t-mobile this week and we'll find out what the carriers are doing. yeah, i mean it's like, 32 times earnings. the numbers should -- the first -- the orders the preorders should have blown away all expectations, and they haven't. i continue to believe that doesn't matter, but, you know, 33 times earnings is rarefied for apple. >> it is. although yesterday when i mentioned it, you came back to the recurring revenues and what is oftentimes the mantra that it deserves a higher multiple and

their service revenue is a larger and larger percentage of their overall number. >> well, i'm standing by that. you're not going to get that number. you're going to get the preorders. the preorders control the narrative. i don't think they should. i think there will be ample demand as we get into the holiday season and maybe the multiples justify it. i'm saying people -- people are concerned they're not thinking about the service revenue. they're thinking are we going to have a shortfall this quarter. i can't tell you whether they are or not, but i remain steadfast you should own apple despite a short-term hiccup on preorders. >> i would love you to ask questions from the people you're seeing out there about the long-term viability of the apple handset. i just, you know, we talked about the fact that they in some ways are a free rider on the spend of others because they have a huge embedded base and they will bring ai to them via

this phone and the software upgrades going to take place, but there are some who believe, jim, ultimately, because of what ai is going to be able to do, you're not going to need apps at all. you're going to need a device that you tell what you want, and it does it. how does apple figure into that world if it, in fact, happens? >> i think that's a great question. i think that there are a lot of people who just say the real truth of ai is being able to talk to a machine and the machine has figured it out and the machine is smarter than we thought. not just talk about the bad guys. but if you can speak to something you can cut out a middle man. i guess you could argue the app store is the middle man in this case. >> right. i think that that's at least the question. existential question, so to speak. >> very much the question. >> but one of the things that's disappointing, carl, is that when you get off the -- with people, what they say what ai is going to do it's going to crush the call center. the call center.

next. they'll say don't, it's the call center. the call center is -- if that's all it's going to do, that's hardly the jetsons. >> i don't know if you heard ellison, he went on in that meeting with analysts to describe how ai is going to change say law enforcement and police departments and drones and surveillance cameras and the ability to commit a crime is going to get narrowed down it a very short window because ai will be so quick to defect your movement. >> the tom cruise movie. >> "minority report." >> is that where we're going, carl? >> slightest movement -- >> precursor. >> precrime. >> precrime and they're going to -- >> yeah. that was a good movie, actually. another great movie from tom cruise. don't remember -- he ran in that movie. 2002. thank you. >> it's the stoconstitution. the boring constitution still in the way. >> jim, you mentioned -- >> don't worry about that, jim.

we'll take care of that. >> okay. as long as the bill of rights is maybe like preserved six out of ten maybe, give us a couple. >> you know -- >> you mentioned holiday spend. a couple things on spending. one is that this challenger gray christmas report says seasonal hiring will be lower than last holiday season because of maybe slower consumer spending. the other is this morgan stanley chart on -- actually not -- it is morgan stanley on walmart plus membership which is the biggest sequential increase in their survey's history, all-time high in august. 30% higher than the prior six month average. >> why the hell not? august 22nd, walmart announced an exclusive partnership with none other than burger king through which members can enjoy 25% off a burger king digital orders every day and a free whopper, i know you'll be going every three months. when i checked in with the company, it started today, and

these are the kind of things that they see went off. when you put them together you want to be a walmart plus member if they're giving away whoppers, count me in. >> i haven't had a whopper maybe ever. i don't know. mcdonald's guy before i stopped eating that stuff. >> i must have had it my way at some point. their chicken -- did they have a chicken sandwich? i ate that a number of years. >> it was pretty good. >> i haven't -- >> really eat the fast food very much. not like you with the baconator. >> my wife is coming out here today. we racked up enough points, whopper, here we come. >> okay. all right. >> jim -- >> you ought to try something, david. like maybe go to a wing stop and get wings. >> you with the wing stop. never stop with the wing stop. >> it's the best performing stock there is in the restaurant group! then it's cava and then sween greene. go to sweetgreen and get all the

sweetgreen you want. >> if you own wing stop, cava and sweetgreen, my god, look at cava. i sat here and doubted you when you talked about the ipo because i thought you knew nothing. >> remember when i named my dog nvidia and you said enough already with this. enough! nvidia was at three bucks. it was at three bucks. >> now your am're making things. i hate when you do that. we talked about things that actually happened. i did sit here on the ipo cava and you were positive. i've never ever questioned you on nvidia. not once. you know that. >> absolutely. but i felt like saying it because i'm out here. >> jim, you mentioned some of the restaurants. i'm sure you saw the starbucks north america chief michael conway, going to be leaving after five months on the job. >> i think that one of the things that brian niccol did when he got to chipotle, was bring in his own team.

and also get rid of lots of positions that you didn't necessarily need. i'm not saying this man's position wasn't needed. i am saying that the organizational structure of starbucks was byzantine and maybe we get some clarity and maybe we get brian niccol people in and you need them because i'm hearing from a lot of people who, of course, are starbucks people, there was a machine that i saw at salesforce that -- a machine that can make like 25 drinks at once. this is what niccol needs. the machine seemed -- it wasn't like i was asking it for a shaken not stirred martini. this machine can make a lot of lattes. >> all right. is the machine just a prototype at this point, jim? >> i think it's -- no. it's ready. it's ready to go. and i think that brian niccol should buy every one they have. kind of like what you need to do with jensen and blackwell. buy every one they have and maybe every drink will be the same. no, you know, maybe you'll get to say three pumps two triple

venti wet hot. i heard one it was like i want a triple venti cappuccino skim wet and i want it hot. no kidding. i guess that's because it's cold? >> yeah. hot always -- i thought that's what they are. >> i was thinking i want my hotter than hot. i don't know. everybody seems to have what i regard as some perception that starbucks is really important and brian's got change it. it's part of the firment. we found a starbucks that closed early because they didn't have the demand duly noted. >> guys, there's a fed meeting. i know you both may not be aware of that. kind of news, right? big news. keeping an eye on the banks. bit of a rally today. i'm looking at most of the big banks up 1%. wells fargo up 1.3%. >> yes. >> there you go ahead of a meeting. what do you think?

>> wells fargo should never have been down that low. >> it's not clear they're a beneficiary from lower rates if we get 50 basis points. some parts of their business benefit, but net interest income may not, jim. >> you're right, david. who benefits just like every single time, private credit. >> good old private credit. >> those people are the kings, new kings. private credit. >> they are a force and if you listen to people like marc rowan who runs apollo they will tell you we're in the earliest stages of a seminole change in terms of the way private versus public is viewed, and, frankly, the way fixed income is viewed. for example, what is private credit? he always asks. is it an alternative asset or fixed income? it's just fixed income is what they would say and replacing a lot of the public debt that is out there over time. >> how about cantor yesterday at

the semifor event saying doj will review how their guidelines for bank mergers, which haven't been written or rewriten in a couple decades, and even still, sort of emphasized branch overlap and deposits as opposed to the influence of buy now pay later and private credit? >> look, i think banks seem to be under assault everywhere. affirm is taking a lot of credit card business. i think that you look at paypal, a lot of buy now, pay later, you have these -- everyone's nipping at them. what they need to do is be able to merge. carl, if they merge then they can cut a lot of costs. a lot of banks we hear are going to bank on ai to be able to eliminate people that they never say eliminate people. they say become more productive. that means eliminate people, by the way. >> guys, s&p about 10 points shy of all-time highs. dow up 100. watch bonds. reminder couple nice prints today.

retail sales came in ahead and industrial production also a beat. second best of the year. 10-year did get down to 3.599 before all that and then ticks up to almost about 3.64. stay with us.

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crude oil continues to hold above 70 ticking higher today. concerns about hurricane francine and the impact on production in the gulf. about 12% of crude production remains off line in the gulf of mexico. and about 16% of natural gas output. dow is up almost 90 points. next hour don't miss an exclusive with chevron's chief mike wirth, that stock negative on the year. on the year. stay with us “outdoor adventures" you.

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. it's time for jim and stop trading. >> bank of america comes out and says look, if you want a rate cut winner go with carvana. carvana is a heavily shorted stock. this is the company that is going to dominate i believe all used car. i think the piece makes a ton of sense and carvana still needs to

be bought, saved by apollo, private credit, not that long ago. >> yeah. that was an amazing deal at apollo pulled off there ultimately. >> incredible. >> jim, i got to -- we get a lot of texts from ceos who watch the show on a regular basis. one is the ceo of cisco, i don't know if you're familiar with them, chuck robbins, big atlanta fan. >> chuck did ask me, he said you haven't seemed to have mentioned the nfl today. there's no need to, i told him. actually i'm kind of done with the nfl. oh. why do you hurt me, david? >> it's not me. it's the control room that ran that. i had nothing to do with this, nothing of nothing. >> that was the falcon game. it was preseason, hope. there's an outright -- in the city that used to be the third largest in america, a stunning belief our coach must go. our head coach, after the

absolutely-like play at the end. >> what about at the beginning when he didn't go for three and went for seven. >> doesn't believe in analytics, going by the way we used to do things when i was playing ball. big heart, david. big heart. okay. he's got a big heart. i actually want a "w" and we got an "l." don't get me started and don't bring him up -- don't bring up the nfl again, okay. you're done. i think that the phillies their magic number is like six. it's fantastic. >> i think -- >> done with football. >> saints are up next. >> international football. >> sledding is not going to get easier. >> i have seamens, salesforce, trane technologies and maybe a new head coach, but i don't have him yet. it's early in the season. chuck robbins should be the head coach for heaven's sakes. >> see you tonight. "mad money" at 6:00 p.m. when we come back -- >> that's for the film. >> that's for the film. >> in a minute

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you. welcome back to "squawk on the street." rick santelli here live at the cme hq with the last branch -- batch of breaking news this morning. up 0.4%. that is better than expected and it's the best since may when we were up 0.5. keep in mind the more widgets we make it contributes to gdp. the question is what kind of demand there is for that inventory. and if we look at the mass association of home builders housing market index, this is a september read. expected at 41. comes in at 41. last month it was 39. that was the weakest number of the year. precovid, this number was in the 70s and precovid to find a number under 40 you had to go back to the summer of 2012. we've had some strength in manufacturing today. stronger than expected retail

sales and industrial production coming in at a whopping 0.8%. 20-year auction at 1:00 eastern. $13 billion. sara, back to you. >> we'll turn to you for those results. thank you, rick as always, rick santelli. good tuesday morning. welcome to another here of "squawk on the street." i'm sara eisen with carl quintanilla and david faber, live for you as always from post nine of the new york stock exchange. stocks are higher this morning up 0.3% on the s&p 500 and consumer names are leading the charge. consumer discretionary up at the top of the market. airbnb, tesla, ford, some of the casinos are doing well. the restaurant companies as well. trading higher today. you've got a number of sectors green. communication services, technology, financials and energy and materials. they are all working. it's the defensive groups that had been outperforming on the month. that's what's under pressure today. health care, staples, real estate, and utilities. nasdaq up about 0.6%. so we are positive now on the week after two days of -- one

plus day of trading. take a look at treasuries right now after rick mentioned better industrial production, better real estate sales and treasuries are selling off. day one of the two-day fed meeting 3.67% is your yield on the 10-year. talk about retail sales. this was a biggy because we're wondering what's going on with the consumer. guess what is this it was better than expected. we got a 0.1% monthly gain. the expectation is that we would have seen a decline on the month. that was good. the other place i look in this data is the control group which strips out gas and strips out building materials and food services and directly feeds into gdp and that was 0. 3% in line with what was expected and revised higher than july. look for gdp revisions on the upside out of that. if you look at the annualized pace of the control group, core retail sales from a year ago,

5.7% annualized pace in the last three months. that's the fastest pace since august 22023. if you are out there rooting for a 50 basis points cut tomorrow there's none in this report that would suggest that's necessary. then again, the argument is, if they're going there anyway, maybe they should just go big. i don't know. i'm more in the 25 sort of just reading the data and some of the commentary from the fed itself. i feel like they just made this turn to start easing. it would be a little dramatic to see 50, but there's been a lot of job owning out there and people thinking -- i think that whatever happens tomorrow, the bigger question and uncertainty for investors what is the path? are they going to 2% or 3%? are they going to 4%? we're at 5.25 right now. that's a little bit more unclear. what is the direction of travel here and then the market can figure out how to get there. >> saying yesterday during our interview with him, the dots are going to be very important.

>> dots are important. that's their forecast for how many more -- >> their forecast can change. >> they change every three months. >> not like we hold them to it. >> they haven't exactly been the most accurate, but sure. and then just a reminder, because this is circulating around the desks and notes today what happens to stock after the first rate cut. everybody wants to know the playbook. it just matters whether we go into revision or not. here's the goldman chart. recession after the first cut means that stocks are under pressure. >> man, growth scores looks really good. >> that's normalization, a better economy, soft landing, all the things we think we're in right now and that's where stocks go up. here from bank of america they give the three-month and six-month view for what happens. stocks lower in the hard landing scenario by several percentage points and then soft landing, which would be the best case, over a six-month period, you know, you get a 10% move in

stocks. history, which may not repeat itself. we're going into an election. there are funky things happening. that's your historical playbook. >> people are on the hunt for an analog where you begin a cutting cycle with stocks at all-time highs, household net worth at all-time highs growing 7% a year and corporate profits growing almost double-digit. an odd time to start cutting rates. >> you usually cut into a downturn, usually cut -- they are worried about the softness that they're seeing but this recovery has been stronger than anybody expected. i think the question, they hiked because of inflation and now is inflation in the rearview mirror or not? they might be a little bit more cautious. canada went down today. >> canada was at 2 and the blackstone cfo says the headline is more like 1.7 if you market shelter. >> jamie dimon and blackrock

overnight saying, there's still so much spending, fiscally coming into this economy, maybe it won't go back down to 2%. still have the infrastructure act and chips act and inflation reduction act and all that's going to maybe add a little bit more to the economy than previous cycles. i will say, though, we got the bank of america fund manager survey and probability of a soft landing is still very high. it's 79%. the number one tail risk scenario, even though many people don't expect this, is a recession. and economic pain. and that's been sort of a moving target. used to be geopolitics, other risks, the election was a risk, inflation has been a risk, but now it's really on the growth. so market still wants to know -- although today's retail sales was helpful in that front. >> let's talk more about the number and the fed's move tomorrow. joining us former barclays ceo bob diamond, ceo at atlas merchant capital. great to have you.

>> carl. >> does this morning's print do anything to change your view? >> no. i have been for a while slower. as you know from the beginning of the year, we really saw the fourth quarter as the first time that they would cut. here we are in september almost to the fourth quarter. my sense is the biggest single risk to the fed is to do too much to quickly. so i'm firmly, as sara is, in the 25 camp. i think 50 would be a statement that is inconsistent, but most importantly, i think what they should do is only 25. i think it would be, you know, with a market doing well, with labor doing well, with the economy doing well, just it creates the risk that we would reignite some inflationary fears and then, you know, the worse case here is that, you know, in the near term, we have to begin tightening again. i'm firmly in the camp that what's correct is 25 basis

points. and i'm feeling pretty confident that's where the chairman and the fomc is as well. >> what do you think the road map looks like in terms of what a terminal rate will end up being? >> you no, it's interesting. aspects. we just announced a joint venture with a and d mortgage, residential mortgage space. i think there's going to be a turnaround in the mortgage market. we had 4.5 trillion in issuance in 2021. 1.5 trillion in 2023. rates were a big part of that, carl. i think that market is expecting a decline in rates. you know, my own view is that prior to 2008 when we had kind of 1% rates forever, the average funds rate for decades was 4%. so in my mind's eye, if the fed continues to ease to encourage a soft landing, if inflation stays

under control, then i think the terminal level for fed funds is probably around 4, 4.5%. >> it's interesting all the banks getting out of the mortgage business. you're going into the mortgage business. >> it's the time to do it. two-thirds of all those residential mortgages really are done by the agencies. about one third by banks in the private sector. 14 trillion in residential mortgages. it's a small sector that's the banks and the private market. much like private credit, i think private companies like a and d mortgage are going to continue to take a bigger slice of what the banks typically have. i think that portion of it, the portion that goes to the banks, will increasingly go to the private sector. >> you're investing in it? >> yes. >> we're doing a joint venture. you know, how can we help them? they've been doing this for 20 years. they're fantastic at origination. we can help them with the bond buyers, so securitizations,

expanding the list of buyers of the securitizations, and then we have a fund called the imperial fund which buys some of the residuals and finding investors for that. we're very much on kind of bringing more clients and customers in so that we get better rates. >> last time securitization moved firmly away from the gses into private hands things didn't go that well, bob. >> there's a sector of that market, in this case called nonqualifying, so a gexample isa lot of athletes and artist, high credit quality but don't have a traditional w-2 and don't qualify for the agency. there's a big sector of the residential market that is very high credit, which is very, very high -- low loan to value, the down payments are quite high. it's a really interesting sector. it doesn't qualify for the agencies. and that's the sector that we're really focused on.

it's high quality, high credit -- >> right. >> exactly. >> that's going to be one to watch. >> it is. >> we'll come back to you on that and see what we get tomorrow. as always, thank you. good to see you. >> thanks. as we head to break our road map for the rest of the hour. meta giving more power to parents to control their teens' instagram accounts. meta's head of global safety joins us live to explain. >> energy is the worst performing sector on the month, on th on the quarter and year. chevron's ceo is going to join us for that outlook and his company in particular. >> intel the second worst performing stock on the s&p, could this slew of new plans and deals turn around the stock? we'll talk autbo that as we're within ten points of all-time highs on the s&p. highs on the s&p. stay with us financial solutio.

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market definitely taking on a bullish stance this morning as we're a handful of points away from an all-time intraday high s&p. only sectors lower are purely defensive. health care and consumer staples. 1.5% gain right now on consumer discretionary. we're back in a moment. at t. rowe price, we help advisors move forward by building agile

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agent will explain your coverage options. and, if you're eligible, help you enroll over the phone. it's that easy! call today and we'll also send this free guide. humana. a more human way to healthcare. welcome back to "squawk on the street." despite increasing demand the price of oil continues to fall with energy stocks under performing on the month, on the quarter, and the year. that said, one company is optimistic it can return to growth in the years ahead with that let's get to brian sullivan at the gas tech conference in houston with a special guest. hey, brian. >> thank you very much.

that special guest is ceo an chair of chevron. mike wirth. >> good to be here. >> good time to be here. a lot of people have been confused about oil and gas price, gas low forever, oil prices below 70, not today, but they bounced back. how does chevron it's been a difficult year for investors and shareholders and oil and gas companies, how does chevron return to growth and return to growth from the chevron equity as well? >> we look at the long term. the near term price has an influence on near term financials, but it really doesn't affect growth investments for the future. we've got strong momentum building in our traditional business with a number of growth drivers here in the u.s., also overseas. new energy business, lower carbon business, project startups this year and next year all underpin strong financial growth over the next several years of 10% annual growth in free cash flow supports a

dividend yielding 4.5%, three times the s&p, strong and consistent share repurchase program and a commitment to return cash to shareholders which gets to the equity value and the proposition for investors. >> you know, there's this i think for the first time ever or in a long time, traders are net short oil contracts and believe that oil is down to bearishness in oil, is unbelievable right now, the idea there's going to be too much oil in the world to meet demand, especially if opec comes back online by adding more barrels over the next year or so. do you have a view as to where the price of crude is going to go the next two to five years, mike? >> wecht to have planning scenariosand so we look at different scenarios. a lot of this it's dependent on the fundamentals. supply has been pretty strong. we've seen growth in supply primarily in the americas. we've got opec with capacity off-line and demand has been less than most people expected as we see a slowing economy here, we've seen slower growth

in china than most people expected and it's a market that right now looks well supplied with some capacity held back. i think that explains the near term outlook you see. >> adding production in the permian, are you surprised the u.s. is at record oil production? i don't think anybody would have thought in 2024 that the u.s. would have been at 13.3 or 13.4 million barrels day. >> we started up a project in the deepwater gulf of mexico. >> the anchor project. >> first ever to get into a 20,000 pound per square inch regime of subsurface pressure, equivalent to an elephant standing on a quarter, new technology breakthroughs -- >> sounds bad for the quarter. i don't know what that means. >> it's high pressure. >> good for chevron? >> it's good for chevron because -- and it's good for the u.s. because it opens up a new regime for us to explore and produce resources in this country in the deep water of mexico. the permian basin we've been

running ahead of our plans and upped our guidance, expect to be at a million barrels a day, just chevron, in production in 2025. producing 400 barrels in the basin. we've got lots of resource in this country, important for our economy and important for the competitiveness of the u.s. >> the deep water platform, as an anchor i like the bait, it's the anchor, these projects are expensive and years to develop. this new project in kazakhstan you've invested in over time. tomorrow is fed day. 25 or 50 basis points, it's everybody is talking about it. as somebody that allocates capital over years, you don't think in months, you think in decades, do interest rates matter more or less than the price of oil for long-term capex decisions? >> long-term cap engs is grounded in the view of gdp growth, population growth,

energy development in economies and growing middle class, consumes more energy, and more than near term interest rates. what is important is policy stability. and investment environment that we can invest in for decades with confidence that we understand what the rules of the road will be and we can invest with confidence which calls for a real balanced view of the drivers of economic prosperity, energy security and environmental protections. >> do we have a view right now under either administration that potentially wins? obviously, trump had been in office before, but we have a new administration policy as well with harris? do you have visibility of what that might look like from an energy policy perspective. >> former president donald trump's policy views are well known from his time in office. >> yeah. >> we've been pleasantly surprised to see vice president harris with some views that are a little different than, perhaps, what we might have expected from her, a recognition that energy is important to our

economy and that some of the technologies that are used in energy production should be encouraged, not discouraged. >> okay. i appreciate your time. i know we didn't get into it. an amazing new hydrogen project in utah. the same as all batteries in america combined sploo . >> the hydrogen storage will be three times the battery storage in the u.s. combined. >> putting hydrogen. david faber think about that. shoving hydrogen into salt caverns in utah is a bigger battery than all the actual batteries that currently exist in the united states. i could see a david faber utah desert week-long road trip journey in our future. send it back to you in new york. thank you very much. >> all right. thanks for the next idea. think about the pictures for that. all right. i got them. brian sullivan. >> let's talk about the fed's two-day policy meeting. if you haven't heard it kicks off today and a lot of debate on

the street. what's the debate about? oh, yeah. 25 or 50? let's get over to steve liesman who has the results of cnbc's latest fed survey. what do they tell us, steve? >> let's get underneath the debate here. this debate how much the fed cuts is linked to views on the economy, david, and respondents to the cnbc fed survey see a somewhat weaker outlook but one in line with a soft landing. gdp seen at 2%, 1.7 in 2025, still around potential government. unemployment 4.5 in 2025. both up a couple ticks as well. the inflation rate coming down gradually towards the fed's target by 2025. a note that near term respondents may be too pessimistic already because today's retail sales are at 3% gdp quarter and the survey average for this quarter is just 2%. they are pessimistic on stocks and you can see it here, currently at 5633.

they see stocks going down by the end of the year, but coming up by 3% by the end of december 2025 to 5806. economist hugh johnston one of the more optimistic members says the config rag of economic and financial market events facing investors for 2025 is quite positive. lower rates and higher earnings ahead with the main question being valuation. he thinks those are elevated and need to come down. 50% of our 27 respondents think the s&p 500 is over priced for a soft landing. 47% saying they're correctly or under priced. this is not all that bearish for this group which is bearish on stocks. how about the economy? 53% see a soft landing around where that's been. 36% say a recession is on the way. and here are the fed expectations. our group differing from the market. 84% say the fed will cut by 25. that compares with a 65% probability of a 50 in the futures market.

3.7 is the year end. almost a percentage point higher than the market is priced with 3.3 being the neutral rate. the longerer term investor you can be chill about this, 25 or 50 won't matter as much as long as the fed gets it right over time, bringing rates down to avoid a downturn. 74% think this rate cut is in time to save the soft landing. guys? >> i am surprised how many big name economists are jaw-boning for 50 basis points tomorrow. ed highman the latest, evercore isi who sees 50 tomorrow. the market is above 60% odds of a 50. the data is not telling you that. >> you know, it's interesting, sara, and i agree with you, because if you think about where the market was priced, when we got really the last piece of data that mattered, the inflation data, before a certain series of articles came out, the

market was 85% for a 25, which tells you at least that at least in the thought experiment, looking at the data ingesting public comments for the fed led you to a 25. that's what led me to a 25. i'm stingcking there. >> we're all in the 25 here on this desk. >> don't get purshed off of it. >> david too? >> no, no, no. david wants a tighten. he's going the other way. >> i just -- 50 to me, i can just imagine us talking about it saying what are we noting me. >> what -- what is -- are the deeper issues here that perhaps they see that we don't? i don't know. i think, steve, i don't know where you are, but more fear perhaps comes to the floor as a result. >> look, it is a close call. one of -- part of my reasoning i'm not sure that powell has

unanimity on a 50 now. he might. i'm not sure he has it. that's one. two is that i think the fed goes gradual when it has an option to go gradual. it goes more than gradual when it doesn't need it. right now, look at this. the control group of the retail retail sales number feeds in. i should be getting estimates of gdp later this morning in the 3% range. that's what people were telling me. you had industrial production still okay in that regard. and ultimately, you would do a 50 if you were in a hurry to go somewhere. you could argue the fed -- i could do both arguments here -- you could argue it doesn't matter because the fed is going to get there anyway by the end of the year. i say they do the 25. they offset the disappointment among the doves with what happens in projecting further cuts down the road. >> we're less than two months of an election, they don't care, they don't talk about it, but feels a little unnecessary.

thank you. steve liesman. >> sure. >> fun to talk about. >> meta making its biggest changes yesterday to protect teens on instagram. meta's global ahead of safety joins us live to discuss what it tsans for the company, paren and the social media landscape. we're back in a moment. tim, you are a rock star. using responsible ai doesn't make you a rock star. it kinda does. you are not rock stars. (clears throat) okay. most of you are not rock stars. oooh. data driven insights, and large language models. oh, that's so rock roll. it is, right. he gets it. yeah. it's a smart move to get a second opinion. you do it when you're looking for a contractor. you definitely do it with medical advice. so why not with your stock market investments? we can help you see opportunities you may be missing.

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welcome back to "squawk on the street." i'm bertha coombs with your cnbc news update. the federal indictment against music mogul sean "diddy" combs has been unsealed. he faces three felony counts of racketeering, sex trafficking and transportation to commit prostitution. the indictment alleges he committed decades of abuse, threats and coercion to full file his sexual desires. combs' lawyers says he plans to enter a not guilty plea today. he was arrested last night at a manhattan hotel. florida governor ron desantis launching a criminal probe into the suspect in the apparent attempt on former

president donald trump's life on sunday. ryan routh has charged -- was charged with federal firearms crimes yesterday. authorities say he never had trump in his line of sight, and never fired any shots. and russian president vladimir putin issued an order to increase russian forces by 180,000 troops. that would make russia's army the second largest in the world only behind china. the kremlin spokesperson says the expansion is necessary to address threats along the perimeters of russia's borderers. sara, back over to you. >> thank you. meta making its biggest step yet to protect minors. the social media giant rolling out new parental settings on instagram impacting teens under 16. for the first time parents can monitor who their kids are talking to and a sleep mode function that quiets notifications from 10:00 p.m. to 7:00 a.m. here to discuss the impact meta's global head of safety,

antigni davis. >> thank you for having me. >> you say this is a fundamental reimagining of what parenting online will look like and will affect tens of millions of teens. how exactly does it work? >> thank you. it is a fundamental reimagining. the way it works is this, we've heard from parents that their top concerns are the amount of time their teen is spending on their phone, the content that they're seeing and who they're connecting with. we have built in protections that are automatic, that address these specific concerns. in addition if a teen under the age of 16 wants to change these settings they've got to get their parents' permission. >> how does it deal with the threats of harassment, inappropriate content, depression, all of those things that came up in that unfortunate hearing where mark zuckerberg apologized at the beginning of the year? >> well, let me detail some of the protections.

i think that will answer your question. we'll be putting teens automatically into private accounts. all teens. in addition they'll have our strictest messaging restrictions. they also will be able to see less inappropriate content and notifications will be turned off in the evening. in addition, parents can actually turn the app off in the evening between 10:00 p.m. and 7:00 a.m. >> what if the kids lie about their age? how will you know? >> yeah. this is something that we've been thinking about a lot. first of all, tens of millions of teens tell us their age and they will automatically be put into these protections. but we know there will be some teens who will try to lie about their age. so we've built in new ways to verify age. for example, if a teen tries to set up an adult account, a new adult account, we are going to ask them to verify their age. if they try to change their up to an adult age, we're going to ask to verify their age.

we're building technology to identify those who might be misrepresenting their age, and to then ask them to verify their age. >> what about data collection? are these kids still getting their data collected for the purpose of selling advertisements? i ask because there's this 2023 case where a number of states actually sued meta alleging you deliberately engineer instagram and facebook to be addictive to young users to sell their data. >> well, first of all we don't sell data. let me start with that. but actually, for teens, our advertisements are only based on their age and where they are. that's actually to protect them, to ensure that we're providing an age appropriate ads experience. we do not serve them based on their behavior on our platform. >> we've done segments in the past couple weeks about schools in the united states at least that are banning the use of

phones during the day. teens have to put their phones into a pouch. don't have access to them until they're released at the end of the day. is that something meta applauds or supports? >> it's a good question. we've heard from teens' parents that they want to be able to have more control over the amount of time that their teen is on the platform. it's one of the reasons that we built out the ability for parents to actually set time parameters so they can set a time limit for their teen for an hour on the platform or even less. but, you know, teens of parents and schools, they need to think about what makes sense for them. i know as a parent i didn't want my teen to be distracted during school. i wanted her to focus in on her schoolwork. and so being able to set that limit or block her out of our app for a time period would have been a welcome change for me. >> are there factions within meta who argue, hey, you're

impinging our engagement? is that a debate within the company? >> look, we know with these changes we're likely to see teens use the app in different ways now or maybe even, perhaps, less, but we really believe that addressing parents' concerns is the best thing that we can do for families and it's also probably the best thing that we can do for the business. >> is this something that you can share with competitors like a snap or a tiktok for best practices? >> i hope that they will look at these and raise the bar as well. >> thanks for coming on to talk about it. it's a big topic of conversation for parents as well. still to come elon musk deleting his post on x that did appear a question, why there weren't more assassination threats made against the president and vice president. the secret service is aware of his post. we'll talk to the authors of a

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so you need a tax-optimized portfolio. at creative planning, our money managers and specialists work together to make sure your portfolio and wealth are managed in a tax-efficient manner. it's what you keep that really matters. why not give your wealth a second look? book your free meeting today at creativeplanning.com. creative planning -- a richer way to wealth. welcome back to "squawk on the street." a new book about elon musk is out today. "character limit how elon musk destroyed twitter." one takeaway that x has damaged musk's reputation but in ten years will probably be more prominent than ever. joining us at post nine, our technology reporters and co-authors of the book. thanks for coming in. >> thank you for having us. >> one early question for a reader might be is this about

content and moderation and culture or merger finance, for example? >> quite a bit of both, actually. we really wanted to take the deal as a whole and get into the finance, get into the logistics of how elon was able to make this deal happen and also get into the sort of existential reasons for wanting to control the company and the way he shifted content moderation since the takeover. >> a lot written about the deal financing but then about the way he approached head count and efficiency, right. i winter wins and losses on that front for him? >> he has cut a lot of costs at the company. 75% less people that work for him. and, you know, the site still largely works, but, you know, the finances are undeniable. the valuation of the company is cut in half. it's valued at less than $19 billion by his own metric. on that front it's been a bit of a disaster. >> i was going to ask. it's in your title how elon musk destroyed twitter.

has he actually destroyed twitter? or is ate work in progress? it does feel relevant in our lives. >> right. we wanted the title to be provocative and make people think about that question. you know, as it once was, twitter no longer exists. it's x now. the business itself, the advertising business, is virtually destroyed. you know, the company's making far less money. elon has taken on quite a bit of debt to keep things rolling. the -- i think the open ecosystem that was twitter that% kind of was trying to support and uplift a variety of voices has shifted quite a bit to be more explicitly in line with elon's political interests. >> i assume you reached out to elon and did he talk to you? >> he did not. we sent him more than 500 questions in the process of reporting the book. we watched your interview with him, but no, he didn't respond. >> he didn't respond at all? >> not at all. >> the isaacson book was instructive or helpful? >> the isaacson book was helpful

because it's elon's side of the story. because we didn't interview him we didn't have that. it was really helpful for understanding his perspective on what was going on, and also for pinpointing his location. he pings around the globe all the time there were key moments in our reporting where we wanted to know where exactly he was, and isaacson's reporting was helpful in figuring that out. >> so elon, from having reported a lot on the deal itself, sort of did stumble into it, i think, and frankly didn't fully understand the nature of contracts when it comes to a true deal of this type. that said, he is still the world's richest man. he can sustain this thing for a long period of time. what are your expectations for the platform from here, given that, again, he can take on more and more debt if he needs to, even if they're not producing a good deal of free cash flow? >> i think it will continue to exist and exist in a long time. yahoo! mail exists and people still use it. doesn't mean it's necessarily

growing. it has a subset of users that find it interesting and valuable to their time. you know, it does remain to be seen if he can sustain these billion dollar plus annual debt payments. that's a huge burden for anyone. >> he can choose if he wants to one would expect, but he might not. >> if you're a tesla shareholder -- >> yeah. nothing has replaced it at this point, would you agree with that? there hasn't been something a sort of -- some sort of a new platform that has taken its place? >> i agree. i think in those really big breaking news moments where everyone feels the urge to just jump into the conversation people are still returning to that platform. you've seen it with the recent assassination attempts on president trump. people are coming there to discuss it. that being said, i think a lot of communities are starting to shift to competitors like threads, blue sky, masstadon and that will continue over time. people get burned out on certain social media platforms and, you

know, in my college era, people transitioning into my space and out of facebook into instagram. people tend to move around the internet as their interests change. >> we have got yahoo! mail reference and now myspace reference. >> yeah. >> we did point out, you think that in ten years, his profile will be just as strong as it is because of other ventures? because of spacex. >> a large part of this book, he is the richest man in the world and controls two major companies. that's undeniable. his achievements with tesla and spacex. you know, the u.s. government is dependent on spacex to get things into space. it's a virtual monopoly at this point. i don't see it changes for him. >> do you guys go into any detail in terms of trying to understand the transformation to a certain extent as a maga warrior we've seen take place? >> definitely. musk's interests in politics have shifted a lot over time.

he used to be very uninterested, and he has talked previously about how he hadn't voted in prior elections, and, you know, i think he's become more and more invested as he started to disagree with what he sees as mainstream politics and want to resist that. we get a little bit into his sort of psychological profile in the book, and he really sees himself with quite a bit much h heroism. coming into twitter he thinks he's going to save the company and reverse the mistakes of the previous management, and i think you see that with politics as well. he sees the -- he believes the country's going in the wrong direction, and he -- he alone, perhaps could swoop in and save dat the day. >> who were the key people you spoke to for the book? >> we spoke to 100 people and at a certain point we stopped keeping track. we spoke to people around elon musk's orbit, at twitter, before and after the takeover, people who worked in twitter's previous

management and wanted to get as in depth of a portrait as possible. >> what was their general view of the prior management? do they lament what's happened? agnostic? i wouldn't say they're necessarily vocal these days about -- publicly about what's happened to the company. >> that's one of the things dis this idea of elon, the bad guy, previous management, the good guys. i think that's a little simplified. when we talk about previous management, they had a lot of issues running that company. it was not profitability. there was going to be a lot of cuts. that's what we report in the book. it's a mixed bag, it wasn't a perfect place by any means. twitter has always been a complicated place. previous management was dealing with that. then we get someone like elon musk coming in. >> what was the line, three guys who drove a clown car into a

gold mine. >> yes. >> good to see you. >> i want to show you the s&p because we did hit that record high. we have been waiting for. it's a strong broad rally here. it persists. look at the s&p 500 right now. 5669. so, record territory. the leader today is consumer discretionary. we got better retail sales numbers. helpful for the economy, helps gdp, the control group that factors in the gdp was up 0.3%. a better july as well. most sectors green. the only thing lagging is real estate, staples and health care. when we come back, intel shares on pace for their best week of the year. we'll tell you why next. coming up on "money movers," the ceo of the best performing restaurant stock of the year. that is brinker. what he's seeing on the consumer. we'll be right back.

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financial weherewithal, the balance sheet that allows us to finish where we started from. >> pat gelsinger on "overtime" yesterday on news the company creating a separate entity for its foundry business, allowing to raise outside funding. announcing two major deals. first an award up to $3 million for the government to make chips for the pentagon and expand the deal with amazon web services to produce custom chips for a.i., although as we mentioned earlier with jim david, intel had already been supplying them with cpus for a long time. customization in their view isn't something new. >> there's a lot of debate about exactly how specific it is, to your point. a poundry deal for intel to make custom chips or march of a custom design and collaboration on new silicon designs is the question? i'm not sure we have the absolute answer.

nobody thinks this positions intel in some sort of a completely new way to be an emerging threat to anybody. at the same time, we know the difficulty that mr. gelsinger has been navigating in terms of forging a future for this company in terms of new foundries and new iterations for the chips. requires a lot of cash. a lot of cash. and on that front, sara, there does seem to be at least some relief that they won't have to sell at lows to fund their ambitions right now. >> maybe that's part of jump, the stock. this is still a stock, to remind you, down 55% year to date and a lot more than that over a lot longer term period. i do want to hit the s&p at a record high again because this is the first time we have achieved a record high since back in july, i believe. look at the s&p right there. the level we've been watching is

5670.81. we're just off that. but we did get there. the dow is at a record high as well. nasdaq is about 4% away. it comes after better retail sales numbers, improves the outlook for an economy at a time the market has been wary of economic data, worried more about a growth slowdown. good news to get industrial production and retail sales. and consumer names are leading the market right now, up 1.4%. it's not just tesla, it's also the casinos and restaurant stocks and some of the retailers as well. >> s&p and nasdaq both up roughly a little more than 18-plus percent for the year. our live market coverage continues after this.

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make complex trading less complicated. custom scans can help you find new trading opportunities, while an earnings tool helps you plan your trades and stay on top of the market. e*trade from morgan stanley good tuesday morning. welcome to nm mm. i'm sara eisen with carl quintanilla. coming up, randy kroszner on the size and pace of rate cuts. a rare interview with the ceo of baker hughes as crude tries to bounce off its 52-week