treasurys. 374 now on the ten-year. got a big number on friday. we should know a lot more after the jobs report. we have a big -- i don't know, have we cared about vice president presidential debates in the past? >> it's interesting, especially if it is the last. >> we'll be watching the moderators, too. make sure you join us tomorrow. "squawk on the street" is next. ♪ good tuesday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber. we kick off the month of october after four straight quarters higher for the s&p, longest streak in three years. plenty of macro to watch today and an east coast port strike. the dow and s&p heading into october at record closing highs. >> with that in mind, fed chair

powell indicates there could be gradual interest rate cuts by the end of this year. also ahead, tens of thousands of dockworkers are on strike at east and gulf coast ports. we are going to explore exactly what will be at stake for the economy. markets are set to kick off a new month and quarter of trading at the open, s&p hitting its fourth positive quarter in a row, and another record close, as investors look ahead to this last stretch of the year. the fed chair yesterday spelling out the direction of rate cuts. >> this is not a committee that feels like it's in a hurry to cut rates quickly. if the economy performs as expected, that would mean two more cuts this year, a total of 50. >> he pointed out the tension between some of the growth data on gdp and income versus labor. >> right, and it just crushed the market. in the old market people seem to think we're in, that would be it. but i was working on an

interview, working from 3:30 to 4:00, jeez, what happened? nothing. people just said this is a buying opportunity. larry fink came out from blackrock with great comments about how let's get rid of the soft landing, hard landing, it's slowing down, there's no inflation. david, when i look at the list of the companies that did the b best in september, it's about as broad as i've ever seen. it's textbook. so there's no flies in the ointment. >> so all good? coast is clear? >> i mean, you do that, that's not -- it was more historical than it was -- >> forward looking? >> but your point is, i mean, a, larry fink saying things about the economy that are shared by others, basically we're not having a landing, we're good. and to your point, there has been this broadening out that we have talked about as sort of a necessary component of a stronger market. >> it's what we've always been

saying. i know you talked lovingly about yesterday. palantir is a meme stock. >> i don't like when you say it's a meme stock. some guy in the dude yesterday, cramer said it's a meme stock. >> i bumped into the ceo when i was in san francisco, and he basically implied that i've been not that complimentary. and i totally agree. >> is that a fair assessment? >> palantir, is it really a meme stock? >> it is, it's owned by a lot of individuals who are very excited by alex carp. i think he's regarded as a bad boy. maybe the pete rose of this generation. >> a lot of people thinking of rose today. >> i loved rose. i don't want to stop you from your broadening discussion, so if there's anything you think is salient that's worth resuming here. >> companies like d.r. horton, the home builder, and then 3m

and the body camera. look at these things. paypal has been terrific. jacob solutions, they did that incredible split-off which everybody seems to like. tesla, of course. iron mountain. another home builder. >> so there's been a real broadening and these are all strong performers. >> stanley black & decker. >> it comes back to the question you raise, past performance is no indication of future. >> right, but i'm just saying, going into the quarter, here is what everybody said. oh, my god, it's just going to be nvidia again, amazon again, microsoft, which, of course, has underperformed. and this list is the kind of list, if you're a retail investor at home and you say, you know what, this isn't just those seven stocks. i get to be in something -- by the way, the best one is netflix. but i just look at these and say, you know what, this market

is no longer that narrow market that people didn't like. if we don't mention this, then what we're doing is robbing people of the idea that we only say negatives. because going in, i really did think it was going to be another nvidia quarter. amazon did bounce right back. but i just think this is what we live for. >> we mentioned yesterday two-thirds of the s&p outperformed the broader index, 3m the best dow name of the quarter. b of a ups materials. >> we can sit here and focus on the fact that apple has downgraded. apple is like a football stock, the numbers are good or bad. have you guys had a hard look at mohawk industries? that's a good carpet company. cbre. vistra. >> vistra has been a particular narrative of the market that we've discussed many times, that continues, by the way. big report today about data

centers in texas. >> we talked about vistra as well. >> do you remember byron, i would suggest maybe it's time to buy and they will say, what the hell is cramer talking about? i needed this kind of market to make it happen. although i did have intel in '90 and then took it off the list. >> intel? >> yes. >> when? >> at the high. >> nice, congratulations. >> thank you. >> well done. you've been rightly negative. >> 30-year-old trade. >> remember when you used to make fun of me every morning, boeing? try it now, because shaddon, did you know him? >> there's so many around.

>> there was shaddon and then another one. >> how about pinterest being the only stock of these big lists that we got today of the best performers? the only one on two. i think that's the kind of thing that says to me, get a little principal pinterest. >> do what? >> there were lists that came out today. >> fourth quarter ideas? >> yes. and pinterest was on two of them. two out of three is not bad. >> yeah, we've got a bunch of top ideas lists we'll get to in the morning. >> we figure that out. it took us a minute. thank you, jim. >> we look at these lists and we say to ourselves, wait a second, these are stocks that nobody has really heard of. i love that. >> that's good. meantime, we do have the port strike to address. approximately 50,000 walking off after failing to reach an

agreement with port's ownership on a new contract. this is the first strike for the union since '77. this is the president of the l longshoremen. >> we're going to keep this going every day, we're going to be on the news, we're going to win this [ bleep ] thing. trust me. they're going to get what the [ bleep ] they deserve. >> some of these reported pay increase offers, jim, are pretty stunning. 60 plus percent. >> this is a stranglehold, and from someone in the industry of shipping, containers of wine and alcohol, were turned around, sent back to capetown. wine from argentina. french producers of high-end wine and booze talking about 747 cargo jets being hired and filled with goods because those will not have to deal with the port. now, this is a very savvy

source. you could say, can't we live without wine? i'm saying this is a paradigm of what could happen, because this is really inflationary, if you think about it. because the cheaper way to send things is not by plane. >> some argue a lot of the goods we would buy for holidays, electronics and so forth, come from china to the west coast. >> right. east coast gets things from europe. but we're not dependent on that much from europe other than what the billionaire class is really focused on. >> then we're not overly concerned about them? >> you know what i mean. did cramer just say that wine is being hurt? what is he doing? >> there's something, it's more than that. that said, i think frank has reported that 80% of the goods needed for the holiday season have already arrived on our shores. >> september was always the month. i remember macy's once filling me in, if they don't have everything by september 30, they're not going to have it.

>> many inventories are in place. the longer this goes on, the bigger the economic impact. >> how about the idea that the first labor agreement that is totally out of whack, and it might hit the screen, possible? >> out of whack? >> they want so much. the machinists want a lot of money at boeing. when you look at the executives, they make so much more money, i don't want anyone to say, does cramer know how much the ceo of boeing made who ran it into the ground. but i think these are the kinds of g of agreements that are so much more. >> the issue is automated cranes and trucks, workers trying to protect their jobs in the face of ongoing tech innovation. >> which, of course, figures prominently in a lot of the strikes, including the hollywood writers that we dealt with as well sometime back, and being replaced by ai, which obviously is a concern there. >> look, if you were talking to jansen wong, he could partner with anybody, do anything.

you could say, look, we'll make robots. >> he can't unload a ship, can he? >> that's what i'm saying. i saw machines that were loading and unloading boxes. one of the boxes fell on the machine. i didn't hear a peep. i'm just saying. >> you didn't hear a peep? >> well, it didn't get hurt. the box fell right on the head of the robot and the robot, like, just brushed it off. then i saw a robot trying to open a box of wheaties and couldn't do it. >> how about this holiday outlook saying that holiday spend is going to be up 7% this year? 7% year-on-year. >> larry fink is going to be right then. that's just an amazing number. look, i think what we're all wrestling with, we're cutting rates, people want 50 at a time when things are good. they're at 7%, david. you could argue that that's a red hot economy. >> that is very strong.

>> the box fell right on the head of the robot and the robot just brushed it off. >> right. >> a union, it would have been a catastrophe. >> that's true. >> he doesn't know a robot. did i tell you the trunk of the waymo and he said, do you think i see you there? >> do robots dream of electric sheets? >> is that what robots dream of? >> i think so, yeah. >> we'll take a break here. when we come back, the latest on cvs as it faces activist pressure to turn things around. we'll get to news on boeing. downgraded disney. upgrade of ford. futures are red. stay with us. (office chatter) is it me...or is work not working? at least, not the way it could work.

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premarket. the company engaging advisers to conduct a strategic review of its business as it tries to fight off activist pressure and a falling stock price, down more than 30% over the last two years. we talked a bit about this yesterday, jim. >> look, i think any board, this is my work on cvs, any board that works to evaluate options and strategy, nothing new. we continue to believe in the potential of our integrative model and look forward to talking with you more about it in the future. this is someone, i think, could say, david, that this is business as usual. i don't know. there's a lot of moving parts, cvs. >> listen, there are any number of investors who are frustrated. we reported yesterday on glenview, meeting with management as well. not focused on a split of the company at all. >> right. >> more focused on operational improvements, specifically on the health care side, actually.

that's sort of where, at least i've heard from a number of investors, is real frustration is, whether it's medicare advantage, overpaying for oak, any number of things on that front. in fact, the retail business, despite what has not been a great business, is hitting, if not exceeding, many of the numbers. and the idea of splitting the company, i just wonder -- and jim, i'll ask you, all right, i've got a pure play retail business in this, i look like walgreens now. why would i want to do that? >> that's where the debt would go. >> why would i want to do that? and what sponsorship am i getting in the stock market from that? >> that's why i'm suggesting there's nothing big at work here. david, i would say when they bought signify and oak street, even as those -- and this is primary care for oak street and then the clinicians, value

provider network. it actually seemed like a good idea. you mentioned the real problem, medicare advantage pricing. it was just so hard, so many companies screwed up. >> including aetna, a part of cvs. >> sounds ridiculous, but one of the problems was she screwed up on people. >> so many injuries. and, of course, they are seniors, many of them. >> i wish i were joking. >> no, i know. >> it hurt pricing. >> it's amazing. >> so i want to say, yes, we can dump on karen lynch and say she made too much, which she probably did. that was the mandate when merlot gave her the company. >> so what happened -- i find it -- listen, we've sat here for years talking about shrink to grow and how many companies are, oh, we've got to do this, oh, we've got to be a pure player

because we've got to get a higher multiple. yeah, i get it all. i'm sure if you're goldman or la sq zard, you're telling them the options, but it doesn't mean they're going to do it. >> i liked signify because they had 170 providers, you brought in new people. look, it was the storefront. you had people go into cvs and then people signed up for this stuff. and i'm not saying it didn't work. i'm saying that was the mandate. so let's not throw her under the m-104. >> i know that bus line. >> i always used to take the m-104. >> where were you going? >> you were not in a hurry, wherever you were going. you could walk faster. >> to see someone special who is no longer in my life. or to see several people who were special who are not in my life. >> time passes, it's true.

we'll take a break here and get cramer's mad dash, countdown to the opening bell. the premarket as we get october under way. don't go anywhere. - [narrator] we just signed the lease on our third shop. my assistant went to customink.com to get new uniforms with all the locations. he found great products, uploaded new art, and had boxes sent to all the shops. custom ink makes it so easy. get started today at customink.com. leo! he's there when we wake up, he's there when we leave, he's there whenever we come back home from school, he's just there always. mash it up doofus.

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all right, let's get to a

mad dash. we've got a little more than seven minutes before we get to an opening bell at the new york stock exchange. >> there's better than feared and then slightly better, and then not bad. i'm putting mccormick in the not bad category. i will tell you, brandon foley is getting this monstrosity together. they went into hot sauce, short-term impact, not doing that well. they have quick serve traffic. but mustard unit and volume share gains in america and poland, branded food service doing well. david, this is a company, i have them on tonight, that everybody knows, they've done a lot of different things that are great. they've put together a lot of different brands that don't add weight. mustard doesn't add weight, frank's doesn't. i put frank's on -- >> on all sorts of stuff?

frank's? >> you're hopeless. i put frank's on palantir. think palantir. >> meme stocks? >> no, alex, the thing he said, it's hard for me to deal with. never mind. let's move on. spices and seasonings, doing really well. everyone in all of america understands what i was trying to say except for you. >> anybody? no, nobody. >> but i do think -- then you look at the things they're doing, i think brandon foley has this in the right direction and i like the stock and i would buy it. david, i'm going to send you a case of frank's and you'll realize that you can put that stuff on anything. >> got it. i appreciate that. that's not -- >> no! this guy is turning the company around. >> okay. >> that's what i'm saying to you. >> so many things he says to me, so few of them i understand. we've got an opening bell coming

up. don't forget, you can catch us any time, anywhere. listen and follow "squawk on the street" opening bell podcast.

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not many ceos have their company's stock price in their first 90 days, but that was pretty much what i walked into in the financial crisis. but really extraordinary work by tens of thousands of schwab-ies and honored to see the client base grow from 7 million to over 40 million and customers trusting us with almost $10 trillion. it's been a wonderful time as ceo and i'm incredibly excited to turn it over to a talented executive with great integrity. >> discussing his decision to retire from the role at the end of the year after 16 years. he'll remain co-chair. rick wurster will step this. jim, we've had boeing, starbucks and now schwab.

>> i'll tell you walt, who has been on the show a number of times -- >> nike as well. >> that's okay. didn't hurt my feelings. frank's. >> i know all about frank's. thank you so everybody out there informing me about the frank's ads. >> walt came on a couple of times because there was a mismatch that he had during the mini bank crisis. first there was the mismatch and then the issue about how much he's paying accounts, and i thought he made as clean as anyone ever has about stuff that people were critical of. and there were so many people dumping on this thing. what did he do? he came on air. and i want to suggest that people that are really furious, come on air and explain it. that's what he did and he put the bottom on it both times. and he boughta lot of stock. it was textbook of how to handle a crisis. [ cheers and applause ] >> we definitely remember,

difficult time for all kinds of brokerages. >> he was a great steward and he will be missed. i really, really like him. >> let's get the opening bell here on the cnbc real time exchange, to the big board. government and commercial services contractor, celebrating its recent merger. maker of diagnostics, kicking off breast cancer awareness month. we saw steve earlier today. >> always does a great job. it's all about awareness. awareness is what we need more than anything. while we were talking, done such a great job, announced retirement. and signet was a company that a lot of people thought was a poor man's pawn broker. she came in and turned that around. unheralded, but i think people should look at the long term of what this person accomplished, and really be thrilled.

she's coming on tonight. how she saved this company. she saved it. unheralded, but terrific. >> actually, signet gets a mention in the upgraded materials over at b of a because they're looking at engagements starting to rise again, which will lead to household formation, which they say is good for materials. >> it's so funny you mentioned that, one of the things she said when they came on air, and talking about september 6th, and she's talking about how it's engagement season and engagement season, it's rarely been as strong. it's been a great reason to own signet. >> what do you make of the barclays call on apple cutting iphone 26 builds, likely indicative of weak demand? i'm reading from the piece itself. >> yesterday they said strong demand. >> i know, we're in that season of yes and no. it's not going to be good, it is. >> why didn't mike sievert tell

me? t-mobile is going to be selling so many -- >> would he tell you if it wasn't? i have a lot of respect for mike, but he can tend toward being somewhat promotional. >> i asked him twice, look me in the eye, is it really good? usually you don't mention on air what people say. he said, look, yes, it's really good. so, i mean, i don't know. and by the way, look at his stock. it's not he's, like, what does he know? put his stock up against verizon and t-mobile. i think you'll see a little bit different. >> it's something i've pointed out many times. at&t shares have had a good year, verizon is okay. but t-mobile is so far above them. and obviously a $240 billion market value. well, well, well more than the $190 billion that verizon sports. >> no doubt about it. >> and you have to take what he said seriously. but there has been a chorus of

analysts talking about iphone demand not being particularly strong. >> they point out this would be the biggest build decline in recent memory. >> it was the kind of thing that took your breath away. but i will point out that we have a mixed view, we don't have a unanimous view. morgan stanley felt pretty good, like i said, t-mobile. it's not a long-term chart there. but, i don't know, i don't want to play the game. down 5, great, sell it on that. how about the fact we don't have the ai version yet? how about the fact we have a great revenue stream? t-mobile doesn't look as good on that chart as it should. >> that's the one year. otherwise, if you go back, it gets a lot better. as i said, at&t is the best performer. he's very happy about that. that's very different. >> guys, boeing shares are down a bit, not much, but there is some talk now of a $10 billion

share issuance, stock worth $10 billion. it may not happen immediately, but it is a bloomberg story that they are weighing raising at least $10 billion. again, according to the story, it's not likely to happen for at least a month, and seems to be, in part, based on whether they can resolve the ongoing strike right now. now, that strike itself is costing the company as much as a billion and a half each month that workers stay off the job. but i did talk to a couple of boeing investors this morning who are not happy about this. they pointed to the fact that, when you're going to do the spirit air space deal, it was going to be all cash, then it ended up being stock. and why in the world would you raise capital now? you've got $9 billion still in

cash, you've got a revolver. why not wait until you revolve the strike, which bloomberg says is certainly a possibility, and then get production going again, get the stock price higher, at least what they anticipated it would be, and then potentially consider issuing shares, not down here where they would be significantly dilutive, representing more than 10% of the company's market value. >> the story basically indicates this company is in far worse shape and we had some analysts take the price target down $100. this is worrisome, boeing is a national treasure. they had trouble many years ago. i sure hope they don't have to -- they should have done $20 billion at 200. they had a chance. >> yeah, a lot of it dependent on the work stoppage, on the strike. we're dealing with strikes, not only the strike at boeing, and

now the strike on the east oeft po coast ports. >> these are not unions you trifle with. in the '80s and '90s, he was king, he could shut down anything. >> i believe you. not familiar with his work. >> an amazing labor leader during the period when i was -- >> axios is quoting a senior white house official who says that in their view, the united states has indication iran is preparing to imminently launch a ballistic missile attack against israel and that would mark escalation of what's happening in the middle east. >> it would be a different narrative entirely. >> interesting, that despite the heightened tensions -- not tensions, the increase in

hostility, it hasn't impacted oil. >> no, and then you take a look at 1973 when syria and egypt invaded israel, oil quadrupled almost instantly and there was stagflation. and now they cut the price. >> they're producing more. obviously we are the key producer in the world. >> we're at 13.4 million barrels. >> when we're talking about the israeli war, 1973, we were 9.2 million. and i just think what we're dealing with is something that was not an opec situation. >> loading up at below $70. >> although, we were at $66.33 this morning. we obviously turned that around. >> we have just moved up on those headlines. >> i think the discussion of this war, which has been twisted and turned with no -- no

commentator i think has had great insight. all i can do is just reference the story. that would obviously change everything. >> israel today did say limited ground incursions into lebanon. not into cities, but they're clearly trying to take out some military assets. and, actually, they said they've been doing it with some practice over the past year. >> yeah, i think that all of these are about having people move back to northern israel and that's a promise that netanyahu made. so you understand that he wants to back up his promise. but a lot of people feel that netanyahu is really winning now, and obviously iran is on the run. i don't know. >> hezbollah may be on the run, but that doesn't necessarily mean iran is. >> a proxy of iran. and then the question of what the response will be from iran, given that its proxies -- >> the speculation is not healthy. >> putin did weigh in today, klm

is cutting flights to tel aviv through the end of the year, so we're starting to get into that cycle that we've become familiar with. >> iran is stopping flights to beruit, which a lot of people feel were a way they got missiles in. everything is in play every minute. you go to "the new york times," they have a constant -- you're checking it constantly looking for any sort of news and it's very hard to get. but iran is spending a ballistic missile, if the i reason dome couldn't stop it, it would be an escalation of unbelievable proportions. >> there are some calls we didn't get to. upgrade of ford over goldman. >> contrary piece. and, i understand, the price of a loan for auto has come down, and it's very contrary, though, to what jonas had last week. i thought that jonas told a pretty good story. he liked ford and he got it wrong, like i did. so i'm not hard on jonas

whatsoever. >> although, some of the september deliveries from neo and lee, they were up 5%. >> very positive. then you think about tepper and the amazing interview that he gave last week. the interview, he was not on the fence about china. >> no, not at all. he continued to say, they're telling you what they're going to do and i take them seriously. >> and i don't know if you got to see michael yesterday from jpmorgan. >> that was a great piece. >> wasn't that unbelievable? >> tell us about it, guys. >> there were a couple things. he talked about fiscal deficits. >> and, remember, he's saying it's the most contentious election in 100 years. then he says, look, i believe this time that the china stimulus is real. he said, i believe. and he said, look, they've said it over and over again and then it was one off. not this time. he's saying you've got to buy it. he told me yesterday, there could be a pullback.

>> he thinks they're acting out of desperation if you look at m2 supplies. >> exactly. >> consumer confidence, property prices. >> the charts were so bad, you would think that they really are in a depression. michael had not been that positive about china until now. i still think michael is the best strategist in the world, and if people don't know -- i mean, he's so smart. i think he has a lot of knowledge about a lot of different things. >> as for the other call that got my attention, downgrade of disney. >> my god, i've got three pieces on disney and the only one that matters is that. it was an incredibly negative piece, and just when you have gasoline come down -- that had always been kind of a nice corollary to disney. david, people really think that there really has been some damage done at disney, that it's not the disney of old, the parks

aren't doing well, the movies, espn. >> the movies did extremely well this summer. >> right. now, a great box office summer. >> no, i'm just saying -- yeah, i just think what's happened here, let's just go back. longer term, the woke issues are still with it, even though they've stopped that. >> yeah, i know. when igor came in, that was textbook on how not to communicate. so many companies have backed far away from dei or the basic idea of any number of initiatives that were undertaken, let's call it, three or four years ago. and obviously bob chapek got himself caught up in something that clearly was not well communicated at all, following some of his employees, and yet not really dealing with sort of

the brand damage that might occur. that said, bob iger came back in and reset things. i don't know how much the damage is. i mean, maybe there is still an overhang from that. >> i'm just saying, you know, barclays, understanding upside and downside scenarios, i like that. but then you've got this bank of america piece, big headwinds into fiscal year '25, largely no. that's good. and then downgrade, idling or in park. >> they also say that ethnic universe will create competition. >> it was nice to see that. potential competition. this is a mention that's positive about comcast. >> comcast, shares have been on something of a bit of a tear lately. >> do you think it's because of

universe? >> no, i don't. i'll tell you one stock that is not performing well -- >> echostar? they told me you killed echostar. >> i don't know about that. the stock is down another 6 plus percent. we had the ceo joining us yesterday trying to explain the deal that is going to be a wireless company with an enormous amount of spectrum, but not much of an articulated plan in terms of the growth practice jek -- trajectory. i had noted that stock has not performed well since the deal was announced. >> it's been a winner. >> it's been a winner for the year. it's still up almost 40% for the year. so it had run up to this announcement of the deal. we're going to speak to the ceo of directv, bill morrow.

>> you've got to give him credit to come on. he's not ducking you. >> no, no, no, didn't duck me at all. i'm happy to have the opportunity to interview him. and they've got a lot to do there, and obviously the deal itself is not going to close for quite some time. >> let me go full circle on disney. what raymond james is saying, basically there are a lot of things that aren't doing that well. the movies were great this year, but the point of it is that it's kind of like -- it's had a move and now it's over. if you look at the long term, that's not the case. it's not a move. this is not a move. jesus, really? oh, man, i put some frank's on that. >> they do point out that customers are still absorbing the ticket -- the cost of a theme park ticket, which was the source of some contention. >> oh, social media was bad.

they did say we're excited about espn streaming product. >> that's coming thissummer. we'll have to wait and see. >> i don't think it should have been downgraded today. i really don't. they do need to do another big theme park. i've said that. when they do it, i'm going to tell you, that's big. >> new mexico? >> on the corridor between austin and denver. why are they resisting this? >> i think you'll have the last laugh. >> i know i'll have the last laugh. let me tell you something, rosebud. >> you're the lex luther of the theme park business. you bought all the land. >> jolts ism coming up at the top of the hour. let's get you to rick santoli. >> this is our sub final, we make the mid-month read and it was 47.0. it moves up a bit to 47.3, but

it still remains the weakest month-over-month left going back to june of '23, and obviously it still remains the third consecutive reading under 50. a lot going on in the world today. yes, we have more data points, and even with the drop in rates and the flattening of the yield curve, 370 in the ten down 8, the distance of 170 basis points, actually the widest in two months, as european yields fall. we're at the lowest yields of the year in europe on their tens. on their twos, two-year low, and we want to continue to monitor, of course, their inflation data. month-over-month was pretty good. year-over-year headline, all is pretty good. year-over-year, core cpi of 2.7% is sticky, just like here. "squawk on the street" will turn after a short break.

apple is the worst performing dow name at the moment down about 3%. we mentioned this note out of barclays we believe apple may have cut 3 million units from a chip component supplier would be the earliest cut in recent history they say, as we try to get our arms around demand for this new phone cycle. it is weighing on the dow down 0.n't 29 s&p 5712. stop trading with jim is next.

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let's get to jim and stop trading with jim. >> let me give you a positive note today. meta, pivotal, talking about instagram, reels, stories all going to come out on top and this is -- they say buy it. 780 price target. keep in mind, this stock is not an expensive stock and if he hits the jackpot and i think he will. you have these raybans, the biggest product in the world for anybody, and it doesn't even matter. doesn't matter to him and it's the greatest product. i love it. love it. >> the other big price bump was you mentioned netflix goes to

760. >> oh, my gosh. netflix, it's incredible. you can monetize the ad, the new slate is really good. what can i say in netflix is fantastic. >> what are you going to do tonight? >> i have chipotle, i have the transition here as brian niccols not there, but we have jack hartung who is sensational, cfo has a new job, gina drosos, the swan song of a tremendous executive and brendan foley, we'll talk more about hot sauce and examine the spice and how brendan is turning that company around. >> that's a good lineup. >> really good show. >> you're welcome. >> what did you say? >> i said that's a really good lineup, jim. >> while we have time let's get to meghan ka cella with breaking news this morning. >> carl, we have breaking news that a senior white house official and a defense department official have told nbc news that the u.s. has indications that iran is preparing to imminently launch a ballistic missile attack against israel. i'm going to read the rest of

the statement here. we are actively supporting defensive preparations to defend israel against this attack, a direct military attack from iran against israel will carry severe consequences for iran. now i do want to note administration officials have been anticipating this sort of response from iran. they say that the country has been postured to move quickly if it wants, but that the iranians do not want a wider war. that's the latest from the white house. yield have moved lower on this. treasury yield hit a session low of 3.57 after these reports. we'll keep an eye on this and back over to you. >> thanks for that. by the way, jim, oil now crossing 70 to the upside. >> this is -- it's not the worst case, obviously, because there's no opec issue, but this is the existential threat that everyone is concerned about for israel and israel does have a very good system to shoots down missiles but if you send enough i'm sure it is -- >> the last time iran did this, they sent over 300, and they

were more or less all defended against. >> right. >> with help from, by the way, other countries in the region, the u.s. and, obviously, that defense system you're talking about in israel itself. >> i think you would be worried that those ballistic missiles might be based in lebanon. >> jim, we'll see you tonight. keep a close eye on the tape today. "mad money" 6:00 p.m. eastern time. more data on the way as well. we will get jolts, ismnd a construction spending in just a few minutes. makes complex trading easier. react to fast-moving markets with dynamic charting and a futures ladder that lets you place, flatten, or reverse orders so you won't miss an opportunity. e*trade from morgan stanley ah, these bills are crazy. she has no idea she's sitting on a goldmine. well she doesn't know that if she owns a life insurance policy of $100,000 or more she can sell all or part of it to coventry for cash. even a term policy. even a term policy? even a term

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good tuesday morning. welcome to another hour of "squawk on the street." i'm sara eisen with carl quintanilla and david faber, live as always from post nine of the new york stock exchange. take a look at stocks under pressure today. they've been down all morning long. some jitters now about this news coming out of washington which we'll hit for you in a moment on iran and israel. the s&p 500 down 0. 75% at the moment. if you look at what is selling

off the hardest right now, you've got technology at the bottom of the list, down 1.7% as a sector and it's because of names like hp down 4%, apple down 3%, the chips not working today as they have. microsoft's down almost 2%. what is working today is energy because oil prices are higher on these escalated geopolitical tensions. communication services and materials, those your three sectors in the green. take a look at treasuries right now as we monitor the latest from the middle east. there's oil. and you can see the spike on these headlines above $70 on wti crude. there's treasuries. safe haven bid, bid to quality. we'll get data in just a moment, but the 10-year yield is now a bit lower 3.7 so recovering after the powell speech yesterday. economic data just crossing the tape. let's goat ricket to rick sante chicago. hi, rick. >> thank you, sara. we're looking at construction spending. it was estimated to be reversing last month's drop but that's not

to be. down 0.1. that follows a negative revision for last month from down 0.3% to down 0.5% which means last month remains the weakest level since february of '21 and this doesn't improve it very much. jolts, the job openings and labor turnover, expected to be a bit under 7.7 million. comes in better over 8 million. 8, 040,000. that follows a slight revise. that number ends up being the best since may -- excuse me, yeah, may, 8, 223,000. an improvement on the jobs front. we have four different categories for the ism pmis on the manufacturing headline for september. 47.2. 47.2. and that follows 47.2. now the sixth consecutive read under 50, which is contraction. if we look at prices paid, this

is a component we want to be moving lower. we're expecting 53.5. a huge drop, this is key, 48.3. 48.3. that is the weakest level of the year, and that takes us back to the end of last year when it was 45.2. new orders, new orders have had five negative reads under 50 in a row. does this make it six? it certainly does. 46.1. 46.1. it's odd because 46.1 actually is better than our last look, so we see the deterioration remains. last month's 44.6 was the weakest since may of '23. ism employment, important week for employment index because tomorrow's adp and friday's job report. 43.9, a huge drop. 43.9, 43.4 in july and there's where it matches up. yields are holding at 3.70

level, down 8, the curve continues to flatten at one point looking at 20 basis points, now that's down to 12. carl, sara, back to you. >> a lot of important information, rick. thank you. rick santelli. meantime, the tape dealing with some of these headlines regarding geopolitics. back to meghan in d.c. hey, meghan. >> we're tracking the breaking news out of the white house to recap here, a senior white house official and a defense department official have told nbc news that the u.s., quote, has indications that iran is preparing to imminently launch a ballistic missile attack against israel. just for a little bit of color here, administration officials had been anticipating a response from iran but as of monday night, two officials had told nbc the u.s. had not seen any movement of assets or equipment to indicate that this was imminent. obviously, something new here this morning. and israel military spokesman is speaking just now saying that we are at high readiness together with our allies and that spokesperson saying further that our ariel defense systems are

fully prepared. so we do know that the state department will be briefing at 1:15 p.m. today and know more then, if not sooner. we know that treasury yields and dollar index dipped on this. back to you. >> have we heard from president biden at all or just the comments from secretary austin? >> just those comments. we haven't heard from biden. there is currently not anything on president biden's schedule today related to this. we do expect that to change in the next few minutes here. >> all right. meghan, thank you very much. as we see a reversal in crude oil jumping to the highest in a few days, but still, a jump on that news. wti crossing the $70 a barely threshold. the market lower if you look at stocks. the economic data and perhaps the treasuries which are rallying further, teeing off of these kind of scary headlines, but also some of the economic data that we just got, manufacturing pmi is worse than expected, as rick reported the

prices paid index, which is how they're passing on inflation a sharp drop as well. that in part reflects what we've seen with oil prices which have been weaker. better jobs numbers, at least on the job openings, above 8 million. we know the fed has been paying attention to that ratio of job openings per unemployed people and something where they've focused on the weakness lately. we did hear from fed chair powell yesterday at the nabe speech and there was important information in there. he says this is not a committee that feels like it's in a hurry to cut rates quickly. we will be guided by the incoming data and if the economy slows more than we expect, then we can cut faster. if it slows less than we expect, then we can cut slower. the takeaway on that is that expectations went back down to 25 basis point cuts for the next meeting in november. we're not in a hurry. that's messaging maybe. we're not necessarily so keen on the 50 basis point cut.

however, raphael bostic the atlanta fed president, also out talking about the next move, and he says a lot of it depends on unemployment. a surprise to the weak side -- and we get a jobs number on friday -- would pull me much further into needing another dramatic move. they're watching the jobs numbers, and they don't want to see a lot of weakness. i think that's going to determine the odds of a 50 basis point cut in november, now go back to under 40. i mean under 50. they were above 50 yesterday. now they're less than 50. the market still guessing on this, but the current guest mate is that they'll go 25. let's see what happens with the data. >> certainly discussion about the number on friday might be the last clean number we get for a while if this strike ends up disrupting labor data. for jolts, quits is again lowest since 2020. >> yeah. fewer quits for sure. the other data point to note today as it relates to this the

arizona inflation numbers. see that? below 2%. 1.8% was the number in september. we've not exactly tick for tick correlated with europe, bunt but it is notable and now the euro selling off the bet the ecb will now have room to cut rates at the next meeting. twh they have a meeting in october and potentially more rate cuts to keep their economy from getting weaker going into recession. the port strike, you mentioned, is it inflationary? is it going to hurt the economy? we've been diving into this and we've got some reports from the ground coming later. just to keep you apprised of the situation, so we have 36 ports now impacted or closed because of the strike. it's 57% of container volume in the u.s. and a fourth of u.s. international trade volume. about $3 trillion. as far as the system on how much is it going to cost the economy? they're kind of all over the map. i picked three that people are focusing on just so investors can have the information.

so the conference board says $540 million per day. jpmorgan, remember first it had a $5 billion estimate, they downgraded it to 3.8 to 4.5 and they're extrapolating from the last strike in 2015. that's why the numbers are so much higher. oxford economics says 0.6 to 1.1 billion per day looking at the export numbers out of these ports. different methodology paints a very different picture. overall, though, i mean we're talking about potentially billions of dollars per week. the key is, how long this goes on, and how much the administration can stomach it. the white house supports the collective bargaining by the unions. they don't want to intervene, and they also have downplayed i think the economic impact. i just took this out of the white house statement. president biden and vice president harris are closely monitoring the strike and were briefed on agency assessments that show impacts on consumers are expected to be limited at this time including in the

important areas of fuel, food, and medicine. they have what they call a full whole of government approach on this with labor, with the economic department, the transportation department, and are clearly paying attention but not as worried because the inventories will go into and when the strike is over should be payback for the economy. >> a lot of holiday inventory in the country. >> true. >> bofa looks at the last few strikes. ten days, seven days, and six days, so these things tend to get resolved within a couple of weeks. >> that's the hope. right. and to minimize the impact on the economy it's not a time where we need the economic disruption and the potential inflationary impact. we're going to watch the shipping rates as a result of that. if companies, especially retail, needs to reroute or go to air freight we're going to talk to the head of the imf, today her first day of her second term, going to be on "money movers" with us on global inflationary risk and whether central banks

are making the right moves on this sort of more aggressive easing campaign, coordinated easing. good time to talk to her and get her thoughts on china on whether the stimulus is for real. >> we're watching the geopolitical headlines and market impact after stocks did close out q3 with fresh highs. joining us goldman sachs chief u.s. equity strategist david kostin, keeps his year-end at 5600. good to have you back. >> nice to see you. >> you stayed with the target because you expect some chop in the next couple months? >> the historical experience ahead of elections the market tends to go down, volatility goes higher and once the uncertainty is resolved the equity market tends to rally. that's the broad framework that we think about. what's most interesting, carl, the stocks in our conversations with portfolio managers that is ap area really not well focused on. tends to be large cap or small cap stocks and there's compelling arguments on which mid cap stocks, think of the s&p

400 as one representation of that and the reason that is they have a long track record for decades of outperforming. their valuation right now is around 15 times in line with their historical average, whereas the rest of the market, the s&p 500, trades at 22 times, very expensive versus history. they have the best torque to a fed cut in rates. when the fed begins to cut, over three months, over 12 months, mid cap stocks outperform. that's the intuition or analytics behind why that's the case, 25% of the balance sheet of a mid cap stock is floating rate. one to one benefit when you have the fed cutting, less interest expense, up increase in earnings, positive earnings revisions tends to lead to out performance. in contrast larger cap stocks have around 7%, not as much torque, so that's the framework and why the best performance in mid cap stocks. >> sorry just real quick -- >> mid caps can be between $5

billion and $25 billion in market cap, that's going to be the sweet spot of where you see the companies. our conversation, david, when we go to london, visit -- on zoom, our clients with the hedge fund world, they're just not an area of focus. they tend to be focussing on the big cap, ai story, but mid cap is less, more -- less focused on. >> less concern overall? not much price discovery. you don't have that much active index. everybody is following an index and will they get the sponsorship they deserve? >> as these are the survivor bias. small cap companies that continue to do well, going to get promoted into the mid cap area. the small cap stocks, one of the reasons 36%, a third of those whole russell 2000 index loses money, negative net income, so that's a challenge if you will. you have positive earnings, you have valuation, you have a long track record and you have the best torque to a fed cut. that's what we think happens. >> if you look at it, market cap weighted that percentage of negative earnings is smaller, maybe in the 20s?

>> want to think about it, a large percentage of those companies are still challenged in this environment. >> so you would avoid small and go large. >> i would say mid cap is your best expectation. our best expectation for returns presently get something like 13% return in the next 12 months the best opportunity set we have. look at the large cap stocks, 6,000, a year on the s&p 500, so still positive earnings, positive trajectory on the index, but i think the best opportunity -- >> is that contingent on a certain amount of fed cut? >> the expectation is both in the forward market and goldman sachs economics is you have a series of cuts in the next nine months. will take fed funds down 200 basis points and that's the general trajectory. the economy grows. generally pretty optimistic view but valuation is going to constrain in my view the magnitude to the upsfwlids sounds nice, david, and then we have a headline the u.s. has indications iran is preparing to launch a ballistic missile at

israel and what's working floor up northrop grum mon, lockheed martin. how do you process the geopolitical risk ahead. oil has turned around. again has not really reflected what's at stake here, especially as iran comes to the forefront. >> so, obviously, a difficult situation from geopolitically but from the economics and from an equity market investor what's happening with the economy and is this likely to affect the general thrust of the pattern of where you see economic activity in the united states, and --. >> not affected. >> the answer is probably less directly. you identified aerospace defense stocks, sort of first order, think about energy generally would be from geopolitical uncertainty rising that is, if you will, first order benefit. more importantly, broad trajectory of the economy is likely to continue to grow. >> and earnings for next year, where are you?

>> earnings likely to grow 6%. probably upside potential to that, but that's generally where we're thinking right now. >> thanks. we'll see you soon. david kostin from goldman sachs. as we lead to break, here's our road map for the rest of the hour. 50,000 u.s. port workers from maine to texas striking this morning for the first timesince 1977. we're going to head to the picket line for the latest. >> megacap tech did outperform in september but names like apple under pressure this morning. we'll talking about the q4 playbook this hour. >> more on that media deal that was making waves this week. the ceo of directv. it's an teiew u inrvyowill not want to miss. "squawk on the street" right back.

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and find out how to get te latest 5g phone on s with a qualifying trade-i. don't wait! call, click or visit an xfinity store today. . the selloff is picking up steam here. just want to show you what's going on with the s&p 500. it's down 1.2%. at the top of the hour down 0.75%. headlines at the top of the hour we can confirm the united states has indications according to the white house iran is preparing to imminently launch a ballistic missile attack against israel. that's according to a senior white house official. we also got data at the top of the hour that showed manufacturing a tad weaker than expectations and still contracting. but job openings hooked better than expected. the market, though, appears to be focusing on the geopolitical risks. you can see that in the price of oil up 2.5%. wti reversing an earlier loss,

just crossed 70 moments ago. we're checking that out and seeing the flight to quality, the bid for treasuries, which is keeping yields a little bit lower. 10-year at 3.7%. again, s&p down 1.2%. nasdaq getting hit a little bit harder, 1.8%. >> stocks of companies involved in shipping also getting hit this morning. this is dock workers go on strike at ports from the east coast to the gulf of mexico. frank holland has been covering the story for us and joins us from the port of elizabeth in new jersey. frank? >> hey, good morning, david. new development in this story as well when it comes to the port strike, the ila has told us the number when it comes to wage increase they're seeking, 61.5%. the president of the ila speaking to cnbc earlier today about the negotiations. >> i just want to confirm around 61% is what you're looking for. >> i didn't stutter. i said around 61.5. >> all right. >> thank you very much. have a good day.

>> you too. have a great day. >> reporter: so again, that was the ila president saying 61.5% is a number they're seeking. the port operators refused to comment on that number and said refer to their statement from yesterday that the two exchanged counter offers, usmx issuing the statement saying the two traded counter offers and would offer wage increases of nearly 50% and also add to employer contributions when it came to health care and retirement and also maintain current language when it came to automation and semi automation a contentious issue when it comes to the negotiation and we spoke to the white house they didn't want to comment on the wage demands from the ila but note the wages for the east and gulf coast port workers have declined over the last six years. they also said they wanted to refer to their earlier statement from today saying in part, president biden and vice president harris are closely monitoring the strike at east coast and gulf coast ports and the president has directed his team to convey his message directly to both sides they need to be at the table and

negotiating in good faith fairly and quickly. the white house maintaining it would not use the taft-hartley act to keep ports open and force negotiations. industry groups and their leaders they want the biden administration to take further action. many of them saying across a number of industries, spirits, auto parts, agriculture, apparel, a strike is going to be devastating for not only consumers but for their businesses. >> so we're talking about $200 million of product a day that's going to get stocks at the ports and that's, you know -- if that stays for a long period of time, it's going to be weeks before those goods can be cleared. in addition to shortages, you can see costs start to go up. you know, that's tough medicine at a time when we're trying to reduce prices. >> reporter: and that was the president of the american apparel and footwear association representing sneakers, book pacs -- backpacks, et cetera. the daily impact of the strike is estimated to be $4 billion

according to some estimates and other estimates about half a billion a day. either way expected to create congestion. for every day of a strike it will create about one week of congestion that has to be unwound. back over to you. >> frank. we did see selloff in some of the retail names yesterday, bank of america attributing it to the strike, abercrombie down 3%, five below 5%, ulta matter name they watched. the street's take on the impact, our next guest believes daily financial losses could be around $2 billion a day for the broader economy. moody's supply chain strategy joins us now. john, how do you get to $2 billion? i highlighted some of the system that are all over the map from the conference board to oxford economics to jpmorgan. what are you looking at? >> thanks for having me this morning. so the estimates are changing. when we went to sleep last night before the strike actually occurred, we were hearing

estimates around $2 billion. that was based on historically foreclosures from west coast and from, you know, less recent east coast strikes. as we woke up this morning, estimates are getting more dismal, getting into that 4 to $5 billion area per day or per week. actually now we're looking at maybe up to $80 million per month if the strike is prolonged into longer than a week or two, which is typically the extent of a strike that happens. so system are changing as we speak. >> and what are the products most affected? i mentioned some of the retailers with apparel. what else is shipped to and from these ports? >> you know, the ports on the east coast and the west coast tip clip handle 50% of the u.s. volume in containers, so when you think about that, there are specific industries based on destinations such as

agriculture, automotive, apparel and retail specifically, but with such a broad balance of business coming into the east and the gulf coast ports, it really will hit every industry from automotive to industrial to manufacturing, so it's going to be broad sweeping in regards to the industries it does impact. >> i saw an impact estimate 29% is furniture and household goods which is among the biggest general electrical appliances another big one. how long do you think this will last? >> you know, it's a challenge because it's based on negotiations. there's a big gap between what the ila is, you know, looking at offering or asking for versus what the management is willing to go out to at this point. hopefully it will be shorter than longer because the impact to the economy could be devastating, especially going into fourth quarter with the holiday season coming up and all these retailers really in the

process of receiving their fourth quarter product right now, it does put value at risk, you know, really is a significant number because every day that product isn't available on the shelves, that's more revenue that's lost by these retailers. as we know they make their year during the fourth quarter so hopefully it will be short lived, but it's based on the negotiations and how quickly they come to the table and make a compromise between the two parties. >> and also how much pain the biden administration, the president, is willing to stomach. five weeks until an election. he's branded himself the most pro-union president in history. i guess that will be tested. >> yeah. it's interesting, i was thinking about that this morning with the auto worker support a while back and now they're as of this morning saying they will not intervene. it will be interesting to see how that plays out. i'm not an expert on what helps policy or politics, but, you know, if all the key players are asking for intervention that

should be an interesting response that comes out in the next couple days. >> thank you very much, john. appreciate the analysis as we try to figure out how much damage is being done from moody's. more "squawk on the street" right after a quick break. dow down about 324. s&p coming off the lows. still down more than 1%. most sto a recrsreed except for energy and utilities right now. we'll be right back. when you're looking for answers, it's good to have help. because the right information, at the right time, may make all the difference. at humana, we

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welcome back. i'm contessa brewer with your cnbc news update. two senior u.s. officials tell nbc news the u.s. has indications iran is planning an imminent ballistic missile attack against israel. israel began a ground invasion in southern lebanon marking a significant escalation of an offensive against iran-backed hezbollah militants. officials warn a direct attack from iran would carry severe consequences. israel said today the number of troops who crossed into southern lebanon last night was in the low hundreds. the military also announced it's calling up four additional military reserve brigades for operations, missions on the

northern border with lebanon. and an israeli official said they have carried out 70 special forces raids in southern lebanon since last november. the comment reveals a far larger set of secret operations than previously revealed. the official said those raids aimed to undermine hezbollah's ability to launch an attack similar to the one carried out by hamas on october 7th. we are keeping up to date on all of the developments in the middle east and continue to bring those to you live on the air, carl. >> thank you. contessa brewer this morning. the markets are moving on all of this news and joining us today retired four-star general at nbc news military analyst barry mccaffrey. thanks for the time this morning. >> good to be with you. >> some of these initial reports quoting u.s. officials suggest this might be as large as the attack inapril. any reason to doubt that? >> well, i don't think anyone has a handle yet on the magnitude or the intentions of the iranians. i'm somewhat surprised -- i

thought they were going to sit this out as a strategic choice. the israelis are into south lebanon now with fairly minor forces. the decapitation of the hezbollah chain of command has already occurred. that's a sum cost. so the iranians have made a decision to escalate the war. i think this will be very serious in its consequences. if they're using ballistic missiles, they may well be able to overwhelm israeli defenses and strike the cities which i think would immediately spark a significant israeli retaliation. so perilous times. >> in the meantime, some of these ground operations in southern lebanon what kind of assets are the israelis interested in neutralizing and how close to beirut or the suburbs of beirut can they get

to without escalating this further? >> well, their stated military objective -- by the way, again, they only have two divisions up on the quarter at this time -- i thought they were going to call up a quarter of a million reservists to conduct a significant ground incursion because their only possible military onlity objective is to destroy hezbollah rocket missile and unmanned ariel vehicle capacity. to do that you have to go in on the ground. they're saying these are minor commando raids, 70 some odd strikes, but i -- let's high ground, favors the defender. this is not a significant military operation with the idf yet. i don't know why they're doing this, unless they're hopeful this is a schignal that would cause hezbollah to rethink and withdraw north of the river again in accordance with the

u.n. agreement. >> general, back in april as carl referenced, i think it was over 300 missiles, almost all defended against, including what, 120 ballistic missiles, 30 cruise missiles, drones, and there was not another response. it didn't escalate from there. why do you believe this time would be different? >> i think the only difference now is the israelis. they're still fighting in gaza. they're now on the ground in combat against hezbollah. the houthis have got them under long-range missile attack uav attack from yemen. they are concerned about the syrians. i think the israelis will not be moderate in their response to a significant iranian attack. also, to be honest, i'm surprised at the huge success of

the last defense against more than 300 iranian missiles. they essentially got all of them. one young girl was killed. they suffered no casualties. i don't know how you pull that off if you get simultaneous attacks from both lebanon, from yemen, and a significant attack out of iran. >> of course the bigger picture, general, is that iran is advancing its nuclear program and this is just further evidence of why it can't have a nuclear weapon. you know, obviously, this is something the market watches closely. is it a question of when and not if israel has to destroy this capability? >> oh, absolutely. but i think it's unrecoverable. i do not believe the israeli air force can destroy the iranian nuclear capacity. i don't think they have the fire power. it's too well protected, not by

air defense so much as underground. i think what we should view iran as a current nuclear power. they're within weeks of a breakout capability. once they get several weapons and communicate that to the global community, they will be seen as potentially capable of nuclear retaliation. the israeli have more than 300 nux they have them at sea on submarines but once the iranians have that stated capability, we'll be in a new world and we'll have to re-establish a new kind of deterrence with iran. >> don't you think israel along with the u.s. can prevent that from happening and would do so? >> i don't think they're capable of doing it. it would have been two years ago. right now you would have to strike all known iranian

scientific capabilities, their underground storage areas. they already have the fissile material. we know they have the delivery capacity, both in missiles and potentially in aircraft, so i personally think, you know, the horse is out of the barn, so to speak, and they're going to be a nuclear power, stated nuclear power, whenever they choose to. >> general, appreciate that. we can see the reaction of energy names and defense names to the tape today. see you soon. barry mccaffrey. more "squawk on the street" continues after this. do you have a life insurance policy you no longer need? now you can sell your policy - even a term policy - for an immediate cash payment. call coventry direct to learn more. we thought we had planned carefully for our retirement. but we quickly realized we needed a way to supplement our income. our friend sold their policy to help pay their medical bills, and that got me thinking. maybe

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we've been reporting on directv's big deal to acquire dish and sling tv from echostar. that deal announced yesterday. we did hear from echostar's ceo yesterday. joining me now to talk more

about the other side of the deal, and the state of the pay tv business is directv ceo bill morrow. good to have you this morning. you know, i guess going to the heart of why you're doing the deal, both company subscriber roles have been declining at a fairly rapid rate. does putting them together help you stem those defections or simply a way to save money in the face of continued reductions in your subscriber roles? >> well, thanks, david. actually it's a combination of multiple things. first and foremost, with all the competition that's out there today, with the direct-to-consumer apps available across the united states, they can't do what we actually have been trained to do over the last 25 years, and that is aggregate a slew of content where we are content agnostic, we can provide a service independent of our businesses within our portfolio, and we

believe while there's good competition, it's limited on addressing many of the consumer pain points that are out there and we believe by putting these two companies together it will give us, one, the influence we need to kind of change the programmers and these carriage agreements, and, two, to be able to invest in products and services aggregated in a way the consumers are telling us that they need. >> right. which is something i guess you recently did with disney after a somewhat brief out age there. is that the kind of model you want to pursue with the other potential programmers? >> it is. but disney only scratches the surface. if you think about it, david, we all want to be able to pick the kind of content that we want to watch, the genres, if you will, and we don't want to pay for the other stuff. the days of old of having 250 channels that you have to pay for whether you watch or not, are gone. the carriage agreements with programmers need to evolve to support that.

the technology we developed, the user interface allows consumers to pick the packs that they want, allows them to integrate a couple of the odd apps they're interested in and we wrap a wonderful user interface to i a how navigation to be easier, to allow search and recommendations to be easier, and equally as important, it's one bill where we keep their costs down and it's exactly what the consumers are telling us they want. >> right. you know it's funny, you're giving reasons here in some ways why this would be pro competitive. when the department of justice opposed these companies coming together your subskrirer roles were almost identical, 18 million or so subscribers, why is it different now when it comes to the antitrust view of this deal? >> 23 years is a long time in our world, david, as you know. the competition with the over-the-top services wasn't

there. the broadband rollout across the united states wasn't there then. that has all changed. we've look at data where we had a third party that says when consumers leave directv where do they go? the third party pulled the dish data when they leave that company platform where do they go? even in the most remote areas of the united states, they aren't going to each of us. they're going to over-the-top services. so this is what we hope to be able to share with the fcc and department of justice that everybody is going to benefit from this. that competition won't be reduced because of those over-the-top services and, again, back to the influence we need to be able to provide a different service that the direct-to-to consumer applications cannot. >> which gets me to starlink, how big a competitor is that satellite-based service going to be for you? is it already? inrural areas it gives people the opportunity to have a

broadband connection to allow them to decide how they want to deal with their video consumption? >> well, and that's what we want to be able to use starlink in these remote areas to provide our over-the-top service. and by combing dish and directv to have the influence to also change the way programming is to where it's smaller, thinner, more selective about what the consumers want, again couple that with a couple of the direct-to-consumer apps and it's going to make the consumers happy. we see a partnership with companies like starlink. >> i see. but i mean, do you not make money then from selling people the dish and that whole part of the business. >> are you solely focused on putting the group of channels together and sell that as a service itself? >> well, there's a lot of consumers out there today that enjoy their satellite service, whether it's directv or dish. most of the growth, most of the people that are signing up for what whe offer because they cant get it with the

direct-to-consumer apps are the over-the-top product which we have. we have directv over the internet and that's what we want to build on by changing the programming agreements, the carriage agreements like what we started with with disney, it's going to give them the best of both worlds and it will still be over the top for the new growth we see here going into the future. what we just need to do is bring two companies together. it will give us the efficiencies and ability to invest, and most importantly, it will give us the ability to influence the programmers to where we see this as complimentary. this is really an important point, this is not an either or. in talking with many of the ceos of the programmers out there, we see this as complimentary. they want to be able to have a certain reach with their direct-to-consumer offering and then what the consumer won't go with is where we step in. in a complimentary way we think we'll give consumers what we want, help the industry be healthier from a financial point of view, and we think that the programmers are going to go back to this partnership concept that

actually helped them to get started in the beginning. >> right. i'm looking on your website at all of the different packages available and, obviously, i would assume that will only continue. going to cost you a lot of money. you're taking on a good amount of debt here and also buying out at&t. are you really going to have the additional capital needed that you just referenced to actually invest in this business, given how much you're consuming to do these other things? >> well, we have two things in our favor, david. first of all we've kept our leverage ratio low within directv. and the second thing is, through tpg, now that is 100% owner or will be 100% owner of directv, they have the financing arm and so that's where a lot of the money is going to be raised to be able to make sure that we have the deal construct with echostar to get the dbs business and even when we combine this, even with the loan that we'll take to be able to help tpg buy at&t with the loan that we're going to contribute to make this

m&a deal successful, our leverage ratios will still be one of the best in the paid tv industry. and after 12 to 24 months, we're going to be back down into a range that's very close to the leverage ratio that we have today. so we have a very aggressive payoff plan that will give the bond holders out there the security that they need. >> all right. and we're going to be doing an interview when you're going public at some point in the future i guess. is that the potential exit? >> there's all sorts of possibilities now. right now we're focused on getting through these stats. >> bill, appreciate you taking the time. thank you. >> thank you. want to get back to these breaking reports iran is preparing a missile attack on israel. we turn to nbc's raf sanchez from the israel-lebanon border. hey, raf. >> carl, in just the last hour, israel's military spokesman has gone up on national television with a stark message. he says, the u.s. intelligence has informed israel that iran is

preparing to launch an imminent missile attack against this country. now this comes less than 24 hours after israeli forces cross the israel-lebanon border which is just the other side of that ridge behind me. hezbollah, the iranian-backed militant group that israel is targeting on the other side of that border, of course, one of tehran's key proxies, and it does appear now, according to u.s. intelligence, that iran is preparing to respond to that israeli attack against hezbollah. now, the israeli military spokesman said a couple of important things, that while the u.s. has informed israel of an imminent missile attack, at this point israel has not detected any launches yet from iranian territory. he is saying that israel's air air defense systems are at peak re readiness and israeli planes are in the sky ready to intercept anything incoming from iran.

we're also hearing from u.s. officials, they are giving a more specific warning, they are saying that iran is preparing to launch ballistic missiles. now that matters because a ballistic missile fired from iran can reach israel in just 12 fired from iran can reach israel in just 12 minutes. it is much, much faster than cruise missiles, faster than drones that can take several hours to reach this country. of course, this has snapped israeli's back to that moment in april when, for the first time in their 40 years, iran launched a direct attack against israel. it fired a wave of some 300 ballistic missiles, cruise missiles and drones. it was in response to an israeli strike at the iranian embassy in syria, which killed a number of senior revolutionary guard leaders. now, that wave of missiles and

drones was largely intercepted not just by the israeli military, but also by american forces across the middle east with help from european and even some arab states. now, the u.s. is saying, according to these officials, that the united states is once again standing ready to protect israel. there are some 40,000 american troops deployed to the middle east right now, including multiple aircraft carriers and squadrons. i don't know, carl, if you can hear that low rumbling behind me, that is the sound of outgoing israeli artillery. we have heard that artillery really ramp up in just the last 40 minutes or so. now, these u.s. officials are warning that if iran moves ahead with a direct strike against israel, that there will be severe consequences for iran. so, carl, this is an extremely high-stakes moment in what has been a very long, very bloody 11

months in the middle east. we may now be standing on the precipice of an all out war. >> we've been talking about this with other guests. is there any reason to think the efficiency of those missiles might be better than it was in april, from the iranians? >> reporter: it's a really good question. the iranians may have learned lessons from that attack back in april when they fired this enormous barrage. some missiles did get through. they hit the runway of an israeli air base in the south of this country, but it didn't cause the kind of widespread damage that many expected it might. that combination of american/european jets in the skies across the middle east, plus israel's old, vaunted air defense systems took out those missiles. we'll see if iran's revolutionary guard has learned lessons and if they are potentially able to find a way through those air defenses now in a way they weren't back in april. guy? >> you referenced the artillery

fire from israel into southern lebanon. what do we know about the incursion made by israeli troops at this point, whether they countered any resistance or where things stand? >> reporter: it's a really key question, carl. an israeli official says the number of troops who crossed the border into southern lebanon last night was in the low hundreds. israel is saying, these are limited, targeted raids. they are designed to push hezbollah fighters back from the immediate border. and to begin creating the conditions where it would be safe for israeli civilians to return to their homes. there's an israeli village just a little bit north of us. it's one of the many, many ghost towns now across the israel/lebanon border. we spoke to an israeli military spokesman just about two hours ago. he said at the time of our interview, israeli forces had not engaged in any fire fights on the ground with hezbollah

fighters. we asked them, why is that if israel is targeting key assets of hezbollah, why is hezbollah not defending them? they say, at this point it appears that hezbollah has made a decision not to engage in direct confrontations with israeli forces who have air support behind them, who have superior weapons, superior training. and it looks like they are falling back to some second line of defense further into lebanon. but the big question, of course, is whether these more limited israeli raids just over the border are going to be enough to restore confidence here in northern israel or if this limited operation is going to turn into something much bigger. guys? >> what are the israelis being told now? are they sheltering in bomb shelters? >> reporter: so, at this point there are restrictions in certain parts of the country, including up here in the north. there's restrictions on the number of people who can gather

in one place. but the israeli military spokesman says, at this point, given that there are no detections of iranian missiles in the air, they are not extending shelter-in-place warnings to israelis all across the country. i can tell you the u.s. embassy in israel is instructing its employees to shelter in place at this time. that is a reflection of that warning coming from u.s. intelligence. right now, you have a lot of very concerned people across this country. they are waiting around their televisions, around their smartphones to see what comes next. and they're waiting to see if more specific instructions come from the israeli military. guys? >> meantime, we have had putin, for example, weigh in on this rhetoric. we've had some european countries start to talk about evacuating their own citizens from lebanon. i just wonder, raf, your sense on other parties that might get involved, even rhetorically and

what that might mean for the conflict? >> reporter: well, at this point, carl, we have seen iran's various proxies all joining in. hezbollah, obviously, the most prominent. hamas in gaza. but then the houthis in yemen, who have been firing toward central israel. one of their missiles reaching the greater tel aviv area in greater days. israel carrying out a very long air strike against the houthis in response. the deep, deep fear here in the region, but also in the white house, is that this spreads to become an all-out regional war. guys? >> thank you for that reporting. we are obviously keeping a close eye on the markets as well. we are seeing weakness, perhaps, in part because of the concerns of geopolitical nature. we pointed out oil is up. the nasdaq is down some 1.7%. the s&p right around a 1% loss

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good tuesday morning again. welcome to "money movers." i'm sara eisen with carl quintanilla live from the new york stock exchange. on the show, kristalina georgieva. got the latest on the port strike as east and gulf coast workers walk off the job. we'll break down the billions of dollars at stake. bruce richards on the show to talk equity, opportunities in the market, real estate, the fed and now geopolitics. we will start, though, in the middle east as the white house reports it has indications of iran preparing a ballistic missile attack against israel, that has sent stocks into a bit of a frenzy. energy sectors, while the nasdaq is down 2%. clawing back some of those losses