subscribers get the full story there, guys. >> man, that is one -- that chart needs some beauty products or something. that is one hideous chart you're looking at there, dom. in a nutshell, what the hell happened? >> since the pandemic and lipstick on something, there's a whole trend right now of greater china being a real drag on some of these personal companies' names and by the way, estee lauder is in the midst of trying to turn things around at this point, so we'll see what happens. >> okay. thank you. let's get a check on the markets. nothing's happening. we didn't need to do this. we could have talked about whatever. but while we're at it, you can see the nasdaq's up 14. dow is up 2 and change. by the end of the day, the actual end of the day, end of the market day, who knows where we'll be? probably up. i don't know. maybe not. join us norm. "squawk on the street" is next. ♪

good wednesday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer, david faber at post nine of the new york stock exchange. premarket relatively steady after tuesday's breather, and plenty of cross-currents. morgan stanley and united beat but we're watching this flurry of negative preannouncements out of european companies. ten-year, 4.02%. our road map begins with the banks, though, and the deal-making boost. morgan stanley, the latest to report a 56% surge in ib revenue. we'll break down the quarter. plus, global chip stocks took a hit yesterday, that after disappointing outlook came from asml, but shares of nvidia are looking for a bounce at the open. and united airlines reporting a stronger profit than had been anticipated, also unveiling a $1.5 billion share buyback program. let's begin with the banks. morgan stanley reported before the bell. they do beat on earnings and revenue, posting strong numbers for wealth management. investment banking with a blowout number. >> yeah, i'm glad you mentioned

all these because they were much stronger. my travel trust owns it. i was quite concerned. i thought i might get snookered on this one. i thought this could be a bad one for me because goldman had good numbers and i was fearful, that, well, hold it, can everyone be across the board good? cha charlie scharf yesterday, we'll get to that. wells, good. but this turned out to be a really terrific quarter. david, this is quite a change from the last two years of james gorman. i like gorman very much, but there's some sort of acceleration here that i didn't expect >> you do? as we pointed out, the stock price itself has underperformed many of its large cap peers. >> as it should have because it was not as good. >> not the greatest start for new ceo, ted pick, who's taken over as the ceo. >> not the greatest hand. >> i don't know. really? was it hand? what are you talking about in terms of re-acceleration? explain. >> well, i mean, i did wealth management had skunked me as not being great for a company that i

went -- was recruited for, for wealth management, many years ago, and i would say have said, that was goldman and morgan stanley. morgan stanley led for a long time in that division, and i also felt that the e-trade acquisition, which no longer seems to be a worry, had been a bit of a drag. this was an all systems go from a guy who -- no one's talking about ted pick, like greatest guy, got to get with him. i don't know. i was thrilled. i thought this was the one. my investment club meeting at 12:00, and i envision this -- i had this blank for, get ready to talk about why you still like morgan stanley, because it's been disappointing. and that's a -- that's a nod to you, my friend. >> by the way, nobody's running away from it. you can see the year to date performance. it's not been bad, by any stretch, carl. it's lower than that of many of its peers, including goldman-sachs. it did have a higher return on

tangible common equity. different business, though, as well. >> right, but this was actually pretty good. transactional revenues increased 10%. the banks, carl, didn't really stink up the garden party. i mean, i know that's a low bar, but -- and as david certainly points out, morgan stanley had been one of those where i was very defensive about. >> you're feeling better. interesting goldman yesterday, you know, started the morning quite strongly. >> up 16 points. >> and then retreated, more or less. >> then plummeted 15. was that just really smart market orders by people? >> i don't know. >> sort of with the broader trend of yesterday. there are some comments from the cfo of morgan stanley about, say, commercial real estate, jim. she argues that restructuring activity is reducing certain losses in that space. >> yeah, and charlie scharf yesterday said the same thing, wells fargo. we have had really good people like barry sternlicht who would

say, there would be a bank fail every week. >> hasn't happened. >> thank you. >> you're welcome. >> i didn't want to say it. let you say it. you're not worried about -- you don't do this show to make friends, you know that? >> no, i don't. i have all the friends i need right here. >> too many, actually. too many friends. >> punching for finals clubs, trying to get in for the ones that restricted. do you know what that word means? >> restricted? yes. >> thank you. >> i do. i do. >> what did you make of what charlie scharf told you? let's take a listen. >> the consumer's been extremely resilient. consumer spend still continues to go up at a very measured pace, both in debit card and credit cards. when you look at deposit balances, they're still strong. credit quality is still performing extremely well. corporations went into this environment with very, very strong balance sheets, and so the facts are that things look

pretty good. >> wow. i mean, look, this was not a glass half full. this is glass full, and charlie's repositioned the bank. got to have about ten divisions. he's going credit card, lending, commercial lending. and all those are good, and he said, look, we kind of worked -- at one point, people were saying that that was the one -- they were the ones that were going to be nailed for commercial real estate. no. no. commercial real estate's not a problem. and i do come back to where -- he said, look, obviously, if you have these buildings that you can't do much with -- >> zombie buildings, so to speak. there's still plenty out there. >> zombie buildings. god, you're good. >> can't do anything with them. >> i don't know who's on the hook. you always come back and say, isn't this bank -- >> there are still losses to be taken, but you don't hear any of the concerns being systemic at all. >> correct. >> that this is somehow going to take down a financial

institution at this point. that said, there are still losses to be had here without a doubt. >> but charlie is talking about, because you had the mark to market, you basically had this ongoing -- we have a problem, we're going to take problem, we have problem, we're going to take problem, so it never became this lump sum problem, particularly for a bank that's known as kind of a local bank that does a lot of commercial real estate. by the way, scharf, can i just say, scharf is so good. i got some texts this morning, said, wow, man, really toe-to-toe. i said, not toe-to-toe. he blew me away. the guy -- when we have a lot of executives on tv, david, and charlie, i'm putting him early pantheon of knowing what the hell he's talking about. >> i imagine that -- it's just interesting to hear the man's voice, given this was the first time. >> me lifluous. i gave him two segments. i can't get the luncheon meeting, but i am king. >> you're making up for lost time.

hopefully he'll become a fixture now. >> every quarter. >> every quarter? every quarter. trying to get him to host our election club. election coverage. >> we have an election club. you just came up with that. >> let's have an election club. >> let's have an election every week. >> i totally enjoyed him, and he is in command, and he's trying -- look, he wants that bank to be -- i said, come on, you're number serven in this, number eight in that. he just looked at me and said, no problem. no problem. >> we're going to get to some of the reacts on citi and goldman as well today. the banks have been somewhat reassuring, but then, of course, there's tech, coming off a rough day for the semis yesterday. down again in the premarket following yesterday's 16% drop, and that did wipe out more than $50 billion in market cap in one day. apple, of course, new all-time high yesterday, up 300% in five years. global chip stocks lost almost, what -- what's the figure here? $420 billion yesterday.

>> in market cap. >> these are the ones that make them as big as buses. that's the analog. they were so -- first of all, they got the day wrong. they reported wrong. >> they reported a day early. >> that says a little bit about them. >> took people by surprise. >> including them. you know, people don't understand. see the stock at the top of that list, intel? the pitiful, helpless giant of semis? qualcomm said, listen, we may buy them, we may not. >> qualcomm hasn't said anything. i reported yesterday when you asked me about that. >> rumor source story. >> and then bloomberg said something about waiting until after the election. kind of the same thing, moving slowly. we'll see what happens. >> but they went -- over and over and over again, saying, it's not a.i., it's not a.i., so what gets hurt the most? a.i. and then we have shows talking about how the top of the semis, top of the -- reminds me of james cagney. top of the world, ma. great scene. >> you're making the key point here, which is, everything but a.i. was weaker at asml, but

a.i. was strong, and yet, nvidia and amd, amongst others, were down sharply. >> it was just kind of wrong. i mean, things -- people got it wrong. now, i want to tell you just as they were blowing up -- and when i say blow up, i mean, not since, i don't know, like since they gave away manhattan for, like, 27 shekels. what was that? >> $22. >> yeah, right? >> peter stuyvesant. >> great man. holland tunnel. >> that was holland, actually. >> i know. he's related to my family. right when asmlf was going, putting nvidia in its place, jensen huang was speaking, right then, and his quote is, "we would like to achieve super human productivity." this is at a lenovo smarter a.i. enterprise conference and i thought it ironic. he's taking over the world but also being taken down by asmlf?

i don't know. i don't know. how was -- how's samsung doing? >> stacy rasgon, who is -- asml is not necessarily the best read across given their expertise and lumpy revenue profile. goes on to say, "nvidia, broadcom, amd all broadly sold off in a move that's potentially overdone." >> thank you. look, he's good. i guess he's owned by no one. >> well, they don't have a banking business at bernstein. >> that's right. panic from two companies, carl, asmlf and lvmh. i guess they use initials over there. were so difficult to try to read through, but then you get down to lvmh, 16% organic decline in china. that's hard. >> that's in asia, x-japan. >> that's hard to do. you have to work at how pbad -- you have to sell no cognac

before its time. you have to say that christian dior was a knockoff from canal street. that was an extraordinarily horrible quarter from a man we all revere, bernard arnault. what do you make of that? >> china. >> forget it, dave, it's china? >> it's chinatown. that's right. >> i have -- i had bright lane on last night. bright lane u.s. is up double digit. >> that was, again, you mentioned the two big stories from yesterday. we'll see how things respond today. it was chips and then luxury. when we got that lvmh report, wine and spirits and liquor down 7%. leather and the key -- goods there down 5%. >> how about perfume? >> perfume wasn't good either. nothing was good. organic sales down 3%. >> ferragamo was a miss yesterday too. >> watches are the way you can show wealth in china because you're not allowed to have mansions. mansions sell for $50 million in l.a. no. the communist party, real down on mansions.

we have this extrapolation of -- it was so wrong yesterday, carl, because we have these european companies. we don't understand them, and then asm was totally opaque. we had the handout from lvmh and had the chart. >> stellantis. airbus layoffs today. >> stellantis, by the way, trying to build more ram trucks in mexico while presidential candidate donald trump is going to slap, you know, going to violate the whole -- the tradition of nafta, let's put it that way, and say, we're going to ruin stellantis. stellantis has become the punching bag of the auto industry. of course, it's really gm that has the most in mexico. don't forget that. >> yeah. stellantis sees quarter shipments down 20%. they're going to pause some more production in italy. >> yeah. i mean, look, this is where the economy is weak. this is what jay powell has to focus on. this is what jay powell has to focus on. that's what he should be worried about. >> what should he be worried about? >> i'm saying there is weakness

in the economy. >> and it's reflecting itself in car sales? >> yes. >> okay. >> yeah. i think that that's -- >> got it. >> cars are huge. by the way, michigan, we got vice president harris there, talking about, to the population of dearborn, that maybe our foreign policy is not right when it comes to israel. the campaigns are now starting to impact -- >> we only have a few more weeks. >> what are you, a member of the election club? >> i love that. i love that. >> we meet today at noon, by the way. >> one time only, the election club. >> are you going to come to our new meeting of election club? >> i'll be there. >> i was not invited. >> speaking of meetings, it's that time of year ago. join the cnbc delivering alpha investor summit right here in new york city on november 13th. i'll be there. i'll be moderating a panel with ben affleck and gerry cardinale. >> you get affleck? i got scharf? >> i get affleck.

yeah. >> no mcconaughey? >> not yet. not yet. working on it. >> just a second. it's too early. >> i'm pretty happy with affleck. other speakers, david einhorn, nelson peltz. >> i'm getting mcconaughey right now. i see you affleck and raise you mcconaughey. >> go to cnbc.com/deliveringalpha or scan that qr code. the future of hollywood, the changes in hollywood. and mr. affleck, along with gerry. >> what's your favorite affleck? >> aflac? >> no, that's deion sanders. i like "the accountant." >> you're talking about ben affleck films? "argo." this is like "inside the actors studio"? >> guy's a great actor, director, also behind the scenes as well.

ceo. >> yeah. i can't even get anybody. you have affleck. i'll have better than you. >> you can't get anybody? >> anybody you can get, i can get better. i'm going to get an agent, an a.i. agent. >> why does everything have to be a competition with you, every little thing? you can have what you have. >> my father always said, there was someone -- there was always laura was better than me, barbara, david. it's about what happened in fourth grade when i got that "b" from plmrs. durov, and you have had to pay for that. >> all of us have to pay for that. i'm dr. phil now. >> jimmy, go to your room. >> it happened. >> you should be smarter than that. jimmy, go to your room. >> oh my god. >> that's what this is about. >> are they in the room with us right now? >> yes. >> and i have been working 18 hours a day ever since, carl. >> who played affleck's brother? i'm going to get him, in "the accountant." >> bernthal. i'm going to get bernthal.

where is he in the pecking order? we'll get to united's quarterly results and the billion dollar buyback, which is the source of some controversy this morning. we'll get to calls on netflix, disney, cisco, starbucks in a moment.

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 policy! find out if you're sitting on a goldmine. call coventry direct today at the number on your screen, or visit coventrydirect.com.

your business needs a network it can count on... even during the unexpected. power's out! power's out! -power's out! power's out! -power's out comcast business has you covered, with wifi backup to help keep you up and running. wifi's up. let's power on! let's power on! let's power on! -let's power on! it's from the company with 99.9% network reliability. plus advanced security. let's power on! power on with the leader in connectivity. powering possibilities. comcast business. power's out. when i step on campus, i know that i have a job to do. there's purpose for me being there. in contra costa college's spirit program, my job is to work side by side with the individual and let them focus on how resilient they are. whether they're struggling with hardship, mental

health and substance abuse, i give them tools that they can use to achieve greatness in their lives. i get to go through these doors and i get to be great. and you can too. at contra costa college, we all can. some gainers this morning being led by jb hunt. first beat on earnings in a couple years. $149 beats by a dime. intermodal up five. citi reiterates it as a top pick. we'll talk more about it when we get cramer's "mad dash" and the nuinbe iabt n mites.

daughter: hey, dad. dad: hey, sweetheart. daughter: what are you doing? dad: i'm gonna clean the fence. daughter: it's a lot of fence. dad: you wanna help me? dad: aim at the wall, but get closer. daughter: (gasps) what the?! daughter: alright. dad: side to side. when you work with someone who knows a lot and cares even more... you can do this. ...you're unstoppable. (♪♪) wow... are you kidding me? you can do this. at truist, we believe the same is true for banking.

let's get to a "mad dash." we've got seven minutes before we get started with an opening bell. right here at the new york stock exchange. jb hunt reported its third quarter earnings. >> let's go over the segment performance. inte intermodal, it's down 13. integrated capacity solutions, down 7. truckload, down 12. that's better than expected. this is a desperate gambit by transport analysts to find something good to say.

i happen to like the people who run this company, but is that the kind of thing that's better than expected? that's what's better than expected? you chided me about liking morgan stanley, and this is what's bte? how about btf. >> which means? >> better than fear. >> okay. that's what it is? >> this is what the transports are all about. this company -- none of these companies are participating in this -- >> is it about execution or just the environment they're operating in? >> it's about comparisons when you have a lot of other companies. csx, i think, is going to report a good number, but this is the kind of thing where you get suckered in. you go buy it, and the next thing you know, it's down ticks. a lot of this, by the way, was because of the east coast/west coast ports. it was a very difficult conference call. this is a very straightforward call. they really break things down. i like to read calls in a vacuum, and i finished, and i said, this should be down, but then i know that the analyst is -- they have nothing to talk

about. they go along and say, which of these companies stopped beating their wives? there's nothing. >> right. nothing good to say. >> the only thing that was interesting was there was mention between arkansas and texas football game of which the ceo just dismissed as not important. i like jb hunt. i'm just saying this is the lesser of evil. >> got it. >> okay? >> okay. that was very clear. >> frank lesser was the evil of two lessers, as carl would know, but you wouldn't. >> that is true as well. one thing i do know is that you can catch this exciting dialogue any time and anywhere. follow the "squawk on the street: opening bell" podcast. opening bell, by the way, five minutes away.

business. it's not a nine-to-five proposition. it's all day and into the night. it's all the things that keep this world turning. it's the go-tos that keep us going. the places we cheer. trust. hang out. and check in. they all choose the advanced network solutions and round the clock partnership from comcast business. powering more businesses than anyone. powering possibilities.

>> announcer: the opening bell is brought to you by nuveen, a leader in income, alternatives, and responsible investing. we'd been talking about this inflection point in industry supply that was going to happen, and it happened in mid-august. it looks even better going forward. revenue environment is strong.

corporate revenue is up 13% in the quarter. got even stronger in october. the outlook from demand and a supply perspective look really good going forward. >> that's united's chief, scott kirby, on "squawk" this morning. decent rasm, jim, first buyback since the pandemic, which the flight attendants aren't too happy about. >> kirby came on in that last quarter and said, we're going to fix things, it's not going to be like this. we're going to take out the capacity. a lot of people just laughed because it's airlines and they don't -- they depend to say a lot of good things and it doesn't happen. he did everything that you wanted. excellent interview with phil this morning, and you know what? the buyback, they may not like the buyback, no union really wants a buyback, but the fact is that there are shareholders, and this man wants to be a rewarder of shareholders. and i don't blame them because the airlines have not been rewarders of shareholders, but congratulations to the company for just saying, this is going to happen, and then doing it.

well done. well doerne, kirby. >> it does take us back to an old chapter when they were getting rescued by the government and there was all kinds of talk about issuing debt for buying back shares, and how bad that looked at the time. >> they are national treasures, and we need -- i don't know. david, you know how inconsistent the airlines have been. this was a nice night. >> is that nick sirianni razzing the fans? is that what that is? microsoft -- microsoft, i see negative notes on microsoft for the first time. microsoft. >>let get the opening bell. >> sorry i bothered. >> at the big board, guess what? it's rxo celebrating its recent

acquisition of coyote logistics. at the nasdaq, it's the food network, new york city wine and food festival, sponsored by invesco, the qqqs. >> microsoft is down big. that is a note from bmo talking about copilot maybe not doing that well. i will counter that by saying charlie scharf, the ceo of wells fargo, is on the board of microsoft, and he said it's doing incredibly well. between bmo saying it may not be doing that well and scharf on the board saying it's doing well, i'm going with scharf. and period, end of story. >> while we're in the area of mega cap tech, jim, this amazon nuclear pact, just one more addition to the story about energy supply and datacenters. >> man, i -- our friendly mr. adam. it is a remarkable thing to see something that was so reviled for so long, nuclear energy, and now it's really our only hope. by the way, seven years before you can really build a new one.

>> even the small nuclear reactors, which is often what they're talking about now to power these datacenters, still take six, seven years. the deal that google reached with this relatively small company as well, to build a number of those reactors. >> how about how much they don't want to do -- >> you're talking 2030 before you even hope to get one of them turned on. >> what i find most interesting is i'll build you a natural gas plant in a couple years and nobody wants natural gas, even though we have the most natural gas in the world but that is considered to be verboten. >> natural gas? >> even though it's cleaner, doesn't have -- >> we export a lot of it now too, and our friends in europe need it. >> well, you know who's a bigger buyer of our ngl these days? china. >> we're selling it to those who are selling it to them? >> i was shocked to see how much we're sending to china. china is, like, our frenemy. >> yes.

>> right? >> yes. i guess that's -- >> we give them natural gas, they give us lithium batteries. >> cobalt. yeah. >> is the nfl going there yet? >> to china? no. >> that's a mistake. >> goodell this week did say the super bowl, he expects maybe one day could be played ex-u.s. some place other than america. >> really? >> are they going to make it a home game like they do with the eagles in sao paulo? >> they're trying to become a global sport. >> brady with the 5% ownership now. >> got approved. >> that was supposed to be against the rules. doesn't matter. it's brady with the white shirt. i listened to brady this weekend. >> what is wrong today? you are so cranky. >> i'll see you at noon, and we'll talk about it. >> speaking of media, piper initiates disney with a neutral, jim. they do give them some credit on dtc getting profitable. >> i know, but this is -- >> experience is moderation. >> it's florida. i'd like to buy a few people and send them down to florida. i think iger is turning the

corner. i think hugh johnson -- what? >> nothing. just sometimes you say things that are very different from what i had been saying, but they just go along and nobody stops as i am now to say, what? >> i changed my mind. >> what do you do, sir? >> right. >> yeah, right? >> was that churchill? >> no. it was john keynes. i'm totally conscious of the problems with florida theme parks. i thought it was going to be such a big deal that dtc would do well. dtc is now doing well, but now i'm supposed to focus on, i don't know, space mountain? what do you want me to do? >> i don't know. we'll see. when we get numbers, we'll see if they continue to remain profitable. at least they were for the first time, obviously, last quarter, in terms of drtc. you've still got the hulu -- i don't know what the number is going to be. the dispute with our parent company, comcast. youc

you've got the development of espn+, which is going to be coming next summer. >> i think it's possible. schefter podcast. >> i don't know that you're ever going to see that venue see the light of day. >> you're all over the schefter podcast. is it because of the sirianni thing? >> yes, because schefter basically said that was unprofessional. >> what happened? for those who don't follow the eagles that closely. >> fans are customers, and sirianni made fun of fans, which i guess is fine since we pay $100,000 for season tickets. i guess that's fine. >> that's kind of on the first rule of no's. don't do this. >> sirianni, he's -- i guess it's fine. we're only just fans that didn't really -- that thought it was not that, you know -- cleveland wasn't that good. i listened to schefter, and the fact is that schefter said it's just unprofessional, and i sat there and watched him rouse -- just trash us, and i think, you know jeffery laurie, i think he ought to think twice about the

idea of a coach trashing the fans. we pay. we pay. i know tv really pays, and we're now just stooges who make noise so it looks like there's something going on. but yes, i'm steamed about that. maybe tickets are free and i didn't know it. maybe someone gave me -- the tooth fairy. >> oh, boy. oh boy. i'm going to move us on now to boeing, because i have been spending, actually, a decent amount of time trying to find out and report on boeing. there's so much question here as to whether they're going to do an equity issuance in the very near term or perhaps wait longer. you can see what the stock is doing. phil lebeau, obviously, also been reporting a lot on the strike, which continues. no negotiations planned that i'm aware of at this point. but there's a lot of noise in the capital markets right now. it's unclear whether it just comes from a lot of hedge funds or we're doing reverse inquiries to investment banks, saying, we'd buy it if you're going to actually sell it, and those same

hedge funds, by the way, are getting short many of the shares so they can cover with any offering that comes their way, conceivably. but there's going to be a big book, potentially, there, no matter, through reverse inquiry. so-called shadow book. we don't know anything at this point in terms of when, right? we're still waiting for the registration, which was just made, and we talked about it to become effective. but it is possible that boeing could hit the market sooner rather than later, and it is possible that it could be a bigger offering than just the $10 billion that has certainly been talked about. that said, maybe, jim, they want to wait, if they can, settle the strike, wait until they get the first delivery numbers on a month and then do an issuance while things are sort of moving in more of an up pace. by the way, that's based on the idea that they're going to settle the strike in the near term. i don't know. i'll defer more to phil, who's covering more closely than i am. you've got some people who are bullish, trying to do the math

on not just 25 but '26 and talking about the possibilities of 7 to $8 billion in free cash flow by 2026. even then, though, if you put a reasonable multiple on it, you don't back into that big a stock move from here. >> why did they not give the machi machinists what they want? >> i don't know t. . the rating agencies are key here. they're going to hit the market immediately, because they do not want to be -- they always want to stay investment grade. >> they start with a $10 billion and then maybe they can upsize it. >> there's not a question as to whether there's demand there. from what i'm hearing, there is. again, you've got some who are shorting the stock and some look at it as an opportunity to cover because they believe that -- >> people have to understand that's -- if they get their allocation, it's a terrific thing. >> but if they don't get their allocation, then they have even more trouble. but we're going to follow this

closely, because it would be one of the largest equity issuances we've seen in quite some time. certainly from a company that has had its share of difficulties, and continues to have them right now as their machinists aren't working. they're not delivering any airplanes, certainly not getting anywhere near the 38 airplanes a month that at some point they promised to get back to. when it comes to equity issuance overall, back to morgan stanley, guys, the stock is up over 5%, and on the conference call, there was a question about, hey, when are ipos going to come back? what about m&a? take a listen to ted pick, the company's ceo's answer. >> i'm bullish on ipos and m&a coming back. it may take some time, and the size of the companies when they come will be likely larger, so they'll be slower unit volume than the sort of the -- the heyday of post-covid stimulus and quick listings, but i think these are going to be global

mature companies which are going to very much need our advice. >> interesting there. he's basically saying, so many of these companies are able to stay private for longer because they have access to capital that they didn't otherwise have not that many years ago. once they do come, and eventually, i guess he believes they will, they'll be bigger. they'll be big ipos because these companies will have been more mature. they'll have been around for quite a few years. >> do you think there's this move to wait until a company is more mature? we're desperate for ipos. >> this was larry's whole point the other day on friday, larry fink of blackrock. >> and yesterday, david solomon gave you some figures about how it's just a wasteland for ipos. my interpretation. and yet, what do we have here? we have everybody waiting for deals. >> i know. will you ever see an openai become a public company? by the way, they have a long way to go yet to get there. theyobviously have to first transition to an equity ownership structure. will you ever see a spacex come

public? >> i'd pay $200 billion for starlink. >> right. or will starlink come public as a part, you know, in some way? but these are the companies that are out there that are exceeding $150 billion market values, at least, based on their last rounds. >> isn't that one of the reasons why the market goes up? >> it would be more in those ipos, if they ever were to come. >> if it was a buy, you wouldn't see such a robust market. where would the money come from to buy starlink? it would come from the selling of communications. >> you've made that point before. >> what does to mean? >> you've made the point about supply in the past, saying that a lot of -- a surfeit of ipos conceivably -- >> you weren't being critical? >> i think he's correctly pointing out, sometimes you will say a new issue will take oxygen out of the room. >> that's true. and i also mention the eagles a lot. and you know, you have me nailed. thanks, pop. thanks, pop. dave faber -- you know how many

times he told me that faber is smarter than me? boy, is he good. >> pop was off on that one. no offense to him. >> david fabere's so smart. >> i think we know who's smarter. things you've said that i have paid attention to are things like, own apple, don't trade it. that's been right too. it's down today. it was up sharply yesterday. >> that note by evidence lab, tawdry. they haven't liked it for ages. i have the date of when they -- >> is that why it's down today? >> yes, it is, because the evidence lab, the ncis of education and stock picking, had some negative things to say about apple. oh, here. june 23rd was the last time they -- of last year was the last time they liked. $183 was the last time they liked it. where is it now? oh. >> how about the barrons piece yesterday, doing some numbers and arguing that buffett may have left 25 bil on the table with his sales? >> don't you think he left a lot of wells fargo when he sold

wells fargo at the bottom? it's all right. i won't say anything. headstrong, maybe foolish. >> it happens. >> ulta beauty, david, is down. >> they got investor day today. it's ulta. every part of the cosmetic food chain is -- estee lauder doing badly. when you see, you know -- when you see that lcvmh, it's kind o jarring. almost like, are people not -- don't want to look as well as they used to? no. they still want to look good. they just don't want to pay it. e.l.f. is down. >> you did have a selfie thesis when it came to beauty coming out of the pandemic. >> you wanted to look your selfie best, but now, i don't know. maybe these new apple phones, david, they can touch up anything. they made me look like jason statham. >> i know him. >> i look just like him. >> i watched one of his movies on a plane called "the beekeeper." it may have been the single worst thing i've ever seen.

>> wasn't it horrible? >> it was so beyond comprehension. >> wasn't it awful? >> you watched that too? you wasted -- >> watched it twice because i didn't want to tell my wife i watched it alone. it's so bad. but he looked just like me when you look at the apple 15. >> i often think when i look at you, i think jason statham. i do. >> not louis ck and not -- >> louis ck? man, i've been canceled. >> he's coming back. >> no, he is back. because he was so crazy to begin with. what can you say? >> what can you say? maybe better off saying nothing. >> is he going to run cbs? >> excuse me? >> nothing. >> the dow is being led by cisco, jim. i don't know if you saw this upgrade over at citi. a.i., only 2% of revenue, but we think that there's upside to that. >> yeah, they say that meta's interested. look, i think chuck has done a great job. if we dig in the archives, you'll see a picture of chuck walking with jensen, and you know what that means. upside. >> upside. is that what that means?

jensen is everywhere. >> he is. >> is there anyone he won't speak to? >>ics, aren't you too many places? he said, i'm not an actor. >> what does that mean? >> he's living what he does. he gets up at 4:00 a.m., he works for four hours,and then he goes in and meets people, and he goes, find out what's the best stuff to do in this super a.i. thing. he was talking about yesterday, it was brilliant at the lenovo speech that he gave. brilliant. >> this podcast, that one, he showed up at the nasdaq. he's there next to becky, suddenly. i mean, the man is everywhere. >> is there a simulation of him? >> he doesn't realize this is the agent jensen. >> does jensen have three jensens? >> let me get mcconaughey on the phone. chuck likes the falcons. falcons do look good. >> yes. falcons look good. >> and i've got that bijan. give him the ball, for heaven's sake. >> bijan? the dog? >> he's a running back.

>> i'm sorry. >> congratulations on getting a wide receiver that's actually worth playing besides garrett. >> what do you mean? garrett wilson is great. we're 2-4. there's only one team that matters in this city for me, and they don't play football. >> let's see what happens tonight. jim, financials leading at the moment. energy's a close second. we do have cnn saying that israel -- u.s. officials believe, will respond to iran before the election. >> i do think that the idea that story came out that they limited what they would attack. it's an odd story because kind of israel denied it almost immediately but the oil stocks yesterday were pathetic, and eog and diamondback have been the leaders, and they have been -- no one's even able to -- i'm sure people today take them up. they can't resist eog and f.a.n.g. those are the two oils if you want growth oils. i'm going to spend some time with chevron soon, david. i might just go 90 minutes

offshore by helicopter to do the show. >> is that next week? >> yeah. >> you're going gulf of mexico? >> yeah. >> offshore. >> yeah. >> to a chevron? >> right. and i'm going to get matthew mcconaughey on. >> yugy with you. >> on the helicopter? >> i'm going to get mcconaughey. we work together very well on some collaborations: we collaborated over salad. >> you had a script you were pitching. >> yes. yes. he -- i don't know. he wanted in, but i didn't tell him i've got other people in mind >> me and affleck versus you and mcconaughey. i'll take that. >> david's so smart. can you keep up with him, jimmy? >> oh, really? your father really said that? i don't believe it. >> yeah. constantly. really hurt. >> i appreciate that. it's far from the truth as our viewers well know. >> he called me at 7:00 after "mad money" and said, sheesh, you know, you are every bit as good as him. i watch the show. >> that must have felt so good. >> it did. thanks, pop. i was worried.

i thought that maybe you favored david. >> we have gone deep into the psychological issues, haven't we, this morning? >> why not? >> we should start our own hour of therapy. >> i think it's national therapy. via starlink. starlink. >> starlink. >> starlink. >> just wait until that star ship goes up and they're launching 400 starlink satellites at a time. musk. >> john connor by that point. >> it's getting crowded in space, that's for sure. >> yes, it is. dow up 150. watch bonds today. we did get some import prices a little bit cooler than -- actually, the big surprise was inflation in europe. uk, 1.7% from a prior 2.2%. france, 1.1%. lot of one handles on global cpi. ten-year is inching back to 4%. we'll be right back.

\s

watch netflix. it reports tomorrow. down four straight days coming into the print a little cooler. loop today goes to $800. says it's not cheap, but they believe the fundamentals continue to improve. couple bucks shy of $700 this morning, down 1%. dow is up 130, and stock trading with jim is coming up next. (wind, rain and rolling thunder) (♪♪) nobody's born with grit. british anncr: rose is really struggling. it's something you build over time. american anncr: that's twenty-one missed cuts in a row. (car trunk slammed shut) for eighty-nine years, morgan stanley has offered clients determination and forward thinking to create the future... crowd: stop it! ...only you can see. american anncr: rose, back in the winner's circle. (crowd cheers) (♪♪) 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 policy! find out if you're sitting on a goldmine. call coventry direct today at the number on your screen, or visit coventrydirect.com.

it's time for jim to stop trading. >> major company, we had them on last time, $200 billion company, abbott labs. $7 billion buyback, hitting on all cylinders. medical devices, which have been really weak, other than medtronic, really came through. we're going to talk about it at our conference at 12:00 noon, and i can't wait to do that with jeff marks but abbott really came through. robert ford is extraordinary, good manager, and it's just a lot to like with the abbott quarter. >> how's -- what do you think the mood is going to sound like on your call today, jim, regarding the markets overall? >> i'm spending a lot of time talking about how we're levered to lower rates in the portfolio and that you have to be levered

to lower rates. every company has to be judged by how well it will do as the fed cuts rates. and so, that -- and then we have two initiations that jeff marks has,both of which are fantastic companies and very exciting, so i hope everybody's there. you can sign up. i know i'm a shill for it. i spend so much time. i get up at 3:30, 4:00. i've done like four drafts of my speech because the club means so much to me. it's really important. >> i mean, viewers and certainly subs rely on it. >> thank you. thank you very much. >> we did not mention, speaking of rates, mortgage apps down 17. >> mortgage rates are all the way back up again. >> we got the 30-year fixed back to 6.5%. that's the highest since august. >> i know. and you don't want to lose your 3.5% mortgage for a 6.5%. it's, again, a problematic situation for jay powell. we have not solved it yet. >> how about tonight? >> we have a bank that is actually doing extraordinarily well. it's a regional, first horizon, and david, you'll like this.

remember first horizon was going to be bought by td? >> yes, and now we know why they weren't. >> did you follow how awful the -- >> we talked about it a bit here. it was beyond even what you might have imagined. chinese criminal gangs laundering money for fentanyl. i mean, what? >> it was one thing for wells fargo to be putting money in on friday and taking it out monday. this was an ingenious con. >> i think we understood why the feds didn't let them buy first horizon after that. >> congratulations, first horizon, for coming right back up, despite the fact that that was such a horrible thing that happened to them. can't wait to talk. jim, look forward to the call, and tonight. >> can i join you? do you have time for a sandwich later? >> sure. any time. >> yeah, and matthew mcconaughey, the invite is -- >> hello. >> the invite is out, and i got to tell you, i like ben's work, but this guy is also a poet. >> oh. >> take that. >> okay. when we come back, morgan stanley's ted pick breaking down the latest quarter when we're back in three.

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 know that's especially true when you're looking for a medicare supplement insurance plan. that's why we're offering "seven things every medicare supplement should have". it's your free, just for calling the number on your screen. and when you call, a knowledgeable, licensed agent-producer can answer any questions you have and help you choose the plan that's right for you. the call is free. and there's no obligation. you see, medicare covers only about 80% of your part b medical expenses. the rest is up to you. that's why so many people purchase medicare supplement insurance plans

like those offered by humana. they're designed to help you save money and pay some of the costs medicare doesn't. depending on the medicare supplement plan you select, you could have no deductibles or copayments for doctor visits, hospital stays, emergency care and more. you can keep the doctors you have now, ones you know and trust, with no referrals needed. plus, you can get medical care anywhere in the country, even when you're traveling! with humana, you get a competitive monthly premium, and personalized service, from a healthcare partner working to make healthcare simpler and easier for you. you can choose from a wide range of standardized plans. each one is designed to work seamlessly with medicare and help save you money! so how do you find the plan that's right for you. one that fits your needs and your budget? call humana now at the number on your screen for this free guide. it's just one of the ways that humana is making healthcare simpler. and when you call, a knowledgeable, licensed agent-producer can answer any questions you have and

help you choose the plan that's right for you. the call is free. and there's no obligation. you know medicare won't cover all your medical costs. so, call now and see why a medicare supplement plan from a company like humana just might be the answer. glp-1 drugs used in weight loss treatments are a global blockbuster, even with disliked and inconvenient injections. study results are arriving monthly from lexarias patented oral delivery technology trials. lexaria bioscience.

♪ good wednesday morning, welcome to another hour of "squawk on the street," aii'm cl quintanilla with david faber here at post nine of the stock exchange. sara eisen is live from 30 rock this hour. markets appreciating some of the earnings we're getting. morgan stanley and united airlines among the highlights today, although the s&p's down a touch once again approaching 5,800. treasurys, a little bit of relief as the ten-year works its way back to 4%. not much data or fed speak today, although we did get export and import prices, sara. >> 30 minutes here into the trading session. here are some movers we're watching. more results out of the financials, regionals like citizens financial, u.s. bank corp., first horizon, all on the move. plus check out shares of morgan stanley, the last of the big

banks to report. it's having a good day, especially good day, up 7.5%. we're going to break down the numbers with ceo ted pick in just a moment. transportation stocks also on the move. united articles and jb hunt both calling out strengthening demand in their markets with united raising forecasts and the airlines are having a good day today as well. look at united, up more than 9%. retail, also in focus. luxury name lvmh missing estimates, calling the outlook uncertain while adidas just raised its profit target for the third time in a row, and that's where i would love to start, which is, the state of the consumer. we do get the big retail sales number out tomorrow. we'll also get jobless claims. expect them to be skewed because of the hurricane, but retail sales really important because more than 70% of our economy is driven by consumption, and if we want to know where the economy is going, look at the consumer. so, let's go to the anecdotal evidence first, what we got from earnings. adidas is having a really strong run, which, of course, stands in stark contrast to nike right

now. they now see sales growing 10% this year. they raised their forecast as well. obviously, a good sign, but also a good sign that they're connecting well with the consumer. on lvmh, even though the overall numbers were disappointing, and what they said about luxury particularly in china, here's what the cfo did say about the u.s. "demand from western clienteles show a sequential improvement, this being very gradual, given that inflation and interest rate remained high." jb hunt, i mentioned the transports. we have seen a return to many normal seasonal demand patterns, and then the united comment that we picked out here, demand continues to be strong. of course, this comes after we talked to brian moynihan at this time yesterday, the ceo of bank of america, second biggest bank nato in the country and here's what he said about the consumer. >> the good news is the consumers keep spending, albeit different stuff, every quarter, it's a little bit different but overall the amount of money they're moving from n from our

customer bays, 60-plus million american consumers moving well over $1 trillion in the economy. it grew over 4.5% last quarter over last year's third quarter. that means the consumer's still in the game and spending, which fuels an economy that's stable. but we have to be careful that we don't choke it off. >> and david and carl, this is why we're having the conversation now about soft landing or no landing instead of soft landing or recession. things are looking up for the consumer. it's not all great. i know we do anecdotal sometimes, talking about value and talking about the stress of the consumer. but some of the more recent commentary has sounded really strong. >> yeah, nrf has its holiday forecast out, sara, approaching a trillion dollars in holiday spend. they point out the consumer or the economy has been in a good place. the consumer economy will certainly continue to benefit from that strength. >> right. and even though that's less

spending than last year, i do think it bodes well for the consumer, and it jibes with some of the other forecasts we've gotten from adobe, for instance, pcw has also done it. look, if you're wondering why, on the consumer, there's a few reasons and a few charts you can point to today. what i did today was just showed you why the consumer is feeling better. look at gas prices, for instance. gas prices, the average gas price in this country right now is, what, $3.20? a year ago, it was $3.60. it has cdo this is relief at the pump. we know that it feeds into consumer psychology, sentiment and just basic spending decision. there's one. how about rates? what we've seen, even though mortgage, yes, you guys talked about mortgage rates going back up to 6.5%, there's still been relief on that front and as the fed has lowered rates and the market's rates have come down, you've seen relief in places like rates for credit cards. so, that's another input. how about the unemployment rate? it's at 4.1%.

it's elevated, but it's also historically low, and not at any kind of point that we usually see during periods of stress or recession, so that also bodes well. and then the only other one i wanted to show you guys, david, is the stock market. because look at the wealth effect. and with the stock market, a record high, you can also look at home prices, which have retained their value and people derive a lot of wealth from that and also good sentiment, but that -- that also feeds into the spending picture, so if you add up these charts, and i could have done more, wages, for instance, as well, you're seeing why the consumer remains so resilient. >> amazing, isn't it, though, that we have an election three weeks away and it seems as though candidate trump is winning on his views for the economy when it comes to -- to the voting public. >> right. i mean, even though consumer's still spending and they're feeling good, we've talked about this before. the sentiment data and the polling hasn't necessarily indicated that.

now, whether that's people are paying more for stuff and they feel that, and they see that, because prices are significantly higher than they were, even though inflation rates have come down, people still feel that, and they're seeing that, and they're worried about it. and they blame the administration for it. i mean, i think we've pretty much clearly seen that, and that's a part of the story. and then, there's still parts of this economy that have felt left behind, and manufacturing pockets of this country, and you have had a strong dollar for the last few years, and that also, you know, doesn't help with export activity, and so the whole tariffs and we're going to tax the other countries and punish them for unfair trade practices, i think that's always been resonant in places, especially, that have been hard-hit by manufacturing moving overseas. >> although we've said time and time again how much manufacturing, construction has exploded in this country, at least over the last few years. a lot of talk about as we are 20 days away from the election. meantime, morgan stanley pushing to new highs on the back of its earnings beats.

profit jumping more than 30% from a year ago. let's get to leslie picker, who has a very special guest this morning. hey, lp. >> hey, cq. i'm joined by ted pick, the ceo of morgan stanley. thank you very much for being here. carl was just showing your stock price, which is up nearly 8% on the heels of these earnings. there seems to be a lot of momentum in investment banking. but still well below historical averages, so i'm just curious, what do you see as the biggest hold-up for this multiyear capital markets recovery we've been hearing about? >> first of all, leslie, welcome to morgan stanley. my namesake. it's great to have you here. >> pick and picker, yes. >> it's great to have you here. you know, it's -- it was a consistent show, again. i'm really happy with the consistency of the results in both segments. the wealth and investment management businesses, but also in the investment bank, which you're making reference to. we have now sequential eps of 202 in the first quarter, 182 in

the second quarter, 188 in the third quarter. so, real consistency. and operating leverage. operating leverage, which you can see by efficiency improving by 300 basis points, and our returns on capital at 17.5%, 18% for the year, so there's a real story there around the top line and around efficiency, but there's also a story around growth, and clearly, what's beginning to happen here is we're starting to see an acceleration activity, not just in the markets business in our institutional securities business but also in investment banking proper. we're seeing it in underwriting. we're seeing it in m&a. it's begin to happen. it's beginning to happen. as you know, the private equity sponsors have over a trillion, $1.3 trillion of cash on hand. there are more than $3.5 trillion of assets in the ground. 10,000 portfolio companies that need to be harvested for the first time the deployment rate is faster than the cash raise

rate for -- in 14 years. so, the financial sponsor community is going to have to move. they're going to have to do something, and obviously, the corporate community is getting active too. to answer your question, what i'm really bullish on over time is the beginning chapters of growth across the center, the fulcrum of our investment bank, which is our investment banking franchise, which is to offer advice, to do the underwriting business, but then also how it filters into our great markets business, and i think it's going to take time, but we're seeing -- we're seeing it begin. we're seeing the reequitization of places like india, japan, on the continent, and that's going to -- as the economy grows, we're going to see that in the u.s. we had, in the covid period, we had called a sugar high of issuance because we were at zero rates, and then we had this pretty tough funk, recessionary-type levels in the core investment banking products, but i think we're now at a new cadence, sort of the

post-funk period where interest rates are starting to normalize, and i think that's going to bring people out into the public arena, which is great for the investment banking business. >> so, you've got rates on the decline. do you expect them to get to zero in a way that would kind of reignite that ipo market that we saw in 2020 or 2021, or would you say that it's kind of going to look a little bit different, this revival might be, as you mentioned on the call, bigger companies, maybe ones that are more sponsor-backed, kind of less of that fervor than we've seen in previous cycles during a zero interest rate environment? >> i think you hit it. i think you hit it. we're not going to go back to lots of tiny companies going public on zero interest rates. we're not going -- those -- that period of 15 years of financial repression of zero sbinterest rate, zero inflation, that's behind us. we're going to something that's more normalized, and i think because you can be a private company for longer, you can build the capital structure

through private equity and the institutionalization of private credit. you don't have to go public as a smaller company if you're generating cash flow. it's great for the sponsors and their lps, but at some point, you probably want to hit the public markets. you want to take advantage of the currency of a public capitalization to pay your employees and long-term expense plans to, make acquisitions, to go global, so i think what we're going to see is the uni volume won't be like it was with spacs and the like but we're going to see call them real large cap companies that have grown under the sponsor portfolio metric to a size where it gets hard to sell them to another sponsor. maybe it's time to go public. and we'll see strategics doing the same thing. they'll be looking to either engage in separations of businesses that have different valuations, spinoffs, split-offs and the like, or they'll be looking to combine with these companies. it will take time, but it's going to happen, and i think part of the edge that morgan

stanley has is that we're running a global business. so, we're seeing that re-equitization happening in japan. we're seeing limited privatization activity on the con i continent in europe. we're seeing re-equitization in the middle east. it's a global phenomenon in india. i think the fact that we've invested in our global franchise for as long as we have is going to start paying off. >> you saw record revenue in wealth management in the quarter and for those who haven't been following morgan stanley as closely, that now comprises more than half of your revenue, more even than institutional securities. the growth of this division, of course, is a factor of asset appreciation, as well as flows, and i'm just curious, a as you look at markets, near record highs at this point in time, do you see further upside from here, or are you a little bit concerned about the levels of the broader equity markets? >> listen, we're seeing daily average revenue transactions, as you know, we call them d.a.r.t.s.

we're seeing that grow largely out of the e-trade channel, sequentially and year over year. we're seeing increased retail activity. our financial advisors are seeing clients increasingly look to engage in more normalized asset allocation, drawing down from some of that peak cash hold because of where rates were. as rates start to come in, we would expect there to be more normalized asset allocation activity and because so much of our wealth management business is fee-based, that kind of asset allocation reset in a fee-based model is very interesting for our clients and obviously for our wealth managers. so, i think we're going to continue to see activity increase because it links into the investment banking set. we're seeing the activity in transaction volumes before we've really seen the deal activity. as you've pointed out, we've seen the debt capital markets issuance, but the typical individual investor is not as engaged in that new issue market. they're more engaged in the ipo

and follow-on market, as we know, and they will, of course, inure the benefit of being able to invest in these exciting new companies over the next three to five years when that comes back into play. i think it's an excellent story terms of the growth of the total. we've gone from 6$6.2 trillion f assets and wealth to $7.6 trillion in a year. you know? $1.4 trillion of fourth and we're going to get to $10 trillion. so, we're on our way. and some of that are higher asset prices. you point out. but some of it is for this year to date, $200 billion of just organic inflows, and there's organic inflows, a lot of that have gone to fee-based accounts, which are managed across all of the investment underliers. >> you've got this great backdrop for wealth management, investment management. what's the stickiness of those fee-based assets if the market

did turn, especially as we sit near record highs? >> the stickiness of the financial advisors. they're the trusted advisors. 15,000 financial advisors. they're investment bankers to their individual clients. they're the lifeline, the counsel, the consiglieri, and they are the special sauce of what we have in the wealth management business and when you have all the technology around them, it's fantastic. e-trade platform, our workplace opportunities, our innovation in a.i. the power of the financial advisor to be productive just continues to go up, and when the markets begin to really get active, because we're not going to go back to zero. we're going to find some kind of normalized level where there are nominal rates and real rates. that's going to be exciting for the f.a. to offer advice. we are interacting with financial sponsor,private equity, private equity. those types of solutions being democratized and being offered to high net worth individuals is another arrow in the quiver.

>> let's talk about a.i. you mentioned it. you have debrief, which is aimed at making the lives better for some of those financial advisors and in terms of simplifying mundane tasks. how else are you deploying a.i. across the organization? and what do you see as the potential efficiency gains from that technology? >> well, there's cost effectiveness, and then there's productivity efficiency, and the cost effectiveness is going to run the entire gamut. we're seeing in our documents business, processing, we're seeing it on the trading floor with our strats, who measure predictive curves and the like. we're seeing it across the entire infrastructure plan around the world. that is just going to continue to develop. in some cases, we'll develop the a.i. capability in-house. in some cases,we'll be a fast follower, but that's just going to be part of the ongoing efficiency metric that will just continue to inure to the benefit of a larger organization that can actually spend the dollars necessary. what makes this technological innovation a little different than some of the past ones we've seen is, you can do it in the

garage. this, you can't do in the garage. you got to deploy it over an entire organization where it's fit for purpose, can grow with the organization under the highly regulated auspices, so you really need to sort of stick with it and prove it out. and we're going to see that in every manner of cost effectiveness in the front office and in infrastructure across the three segments, investment bank, investment management, and wealth. but when you speak to productive efficiency and effectiveness, that's when you start seeing the behavior and the relationship between the f.a. and the client over time really being enhanced to a different level. having the kind of data coming in on contemporaneous conversations, on a sense of what is of import at the moment and what is the reaction function, what are people doing when they get that advice, how do i react to this exogenous event? we're in the early innings, but i think it's going to be a remarkable tool, not just for shortening the time period to

sort of replicate what we've put on paper through a copilot, but also to sort of help gear the thinking to what leslie picker cares about in particular moment, talking to her f.a. and and what the f.a. -- what she says in response is important to you because she knows that is of the moment in the system but also likely to be what you care about too. >> all right. ted pick, ceo of morgan stanley, thank you very much for being here on this earnings day. shares up about 7% on those q3 results. really appreciate your time. >> thanks for coming. >> back to you guys. >> leslie, thank you for that. a moment ago, shares up 8%, which would be the best earnings reaction, david, in 13 years. thanks, bespoke. >> before this session started, and before we got those earnings, morgan stanley had trailed not by a large extent, but trailed some of its big cap peers in the finance sector. no longer. its year-to-date performance is right in line with many of the other names and it's been a very good year to own the financials broadly speaking.

>> anything encourage you in the m&a outlook? >> i mean, not really. not really. you know, you could have -- you could have said that exactly this time last year about 2024, and you would have been wrong. >> it's definitely the carrot that keeps getting strung out in front of us. sara? >> all right, as we head to break, guys, here's our road map for the rest of the hour. amazon, the latest mega cap tech to go nuclear. striking a power deal with one of the big utility companies. details for you coming up. plus, chip stocks coming off what was the worst day we've seen in more than a month. some under some pressure again today. stocks investors need to watch. that will be in today's trading. and a condo crisis in one of florida's biggest markets. it started well before those devastating hurricanes. robert frank has that as "squawk on the street" cties onnu.

[children playing] hey guys, come on! time to eat. time to eat. i don't want this. i want corndogs! ♪♪ corndogs! corndogs! corndogs! ♪♪ i need another corndog!

sometimes as a caretaker, you don't take the best care of yourself. but i needed to make a difference in my life. not just for me, but for my daughter. and i'm here now.

reclaiming my voice, being brave and showing my daughter that regardless of the rough patches, you can still shine bright. i have a hidden disability, and i'm thriving. supported by disability services at contra costacollege, i've developed a plan to enhance my future. and you can too. check out energy today. wti crude and brent crude making a bit of a round trip over the last month, currently recovering at levels we last saw around october 1st and while commodity prices have seen a little pressure, nuclear continues to tear higher. shares of bistra and constellation up 34% or more in that time, driven by headlines the likes of which we got today, sara. >> it's every day there's something new here. amazon is now the latest big tech name to jump into the nuclear space.

diana olick live in arlington, virginia, with the details. >> good morning, sara. amazon web services is investing more than half a billion dollars in nuclear energy across three different projects here in virginia, home to nearly half of all the datacenters in the u.s. aws signed an agreement with dominion energy to explore the development of an smr or small modular nuclear reactor near dominion's existing north anna nuclear power station. i asked aws ceo matt garman why the push to nuclear. >> we're looking forward, and we see the need for gigawatts of power in the coming years and there's not going to be enough wind and solar projects to meet the needs, so nuclear is a great opportunity. also, the technology is advancing to a place with smrs where there's going to be a new technology that's going to be safe. there's going to be easily -- easy to manufacture, and a much smaller form factor. >> smrs are an advanced kind of nuclear reactor with a smaller

physical footprint, allowing them to be built closer to the grid. they also have faster build times than traditional reactors. >> it is safer. so, the technology is self-contained and how the cooling is done, so it's a new technology and how that works, and it is a fundamentally different way about going about powering these plants, and so it is a safer technology. >> amazon also announced an agreement with utility company energy northwest to invest in the development of smrs in washington state as part of that, amazon's climate pledge fund announced it is the lead anchor in a $500 million funding round for x energy, a developer which will provide the parts and nuclear fuel for that project. and at a press conference, moments ago, energy secretary jennifer granholm announced $900 million in d.o.e. funding is now open for those looking to deploy more smrs. >> diana, thank you. very interesting.

amazon, not just the latest big technology company that is making nuclear power deals. google, earlier this week, signing a deal to buy nuclear energy from cairos power. it's a first of its kind deal to speed up the clean energy transition in the u.s. and it's due in part to that growing demand -- power demand for datacenters -- from datacenters. mike joins us now, a first on cnbc interview. good to have you, mike. congrats on obviously a very important deal for your company. diana was talking about any number of companies that are looking to move forward when it comes to smrs. is there a lot of competition for the likes of kairos out there or just enough demand to meet all that competitive need? >> david, thanks for having me. first off, we -- there's plenty of need and demand in the space. we follow the progress with all of the developers, but and we're happy for them. we wish them the best. there's no shortage of need for

carbon-free power. we're excited about our agreement with google, and the future prospects that it has for our partnership to deploy 500 megawatts of new capacity, and that new capacity is key, and able to kind of expand and allow for future expansion as well. we're excited about the partnership with google and looking forward to what it brings. >> i want to ask you more about that. i'm curious, though, we talk so often here, perhaps you watch, about the need for power right now being fairly urgent. obviously, these plans and these plants are years away. how do you square those two issues, in terms of why not deliver the power, or can we deliver the power now as opposed to five years from now at the earliest? >> so, the reality is that nuclear technology, it's complex. it takes more time to develop. the small reactors provide a lot of economic opportunity as well as improved safety, which is exciting. google has been kind of front

runner in its vision for enabling new carbon-free technologies for a long time. and they view kind of their portfolio here as a combination of near-term, medium term, and long-term options and we're excited they've chosen our technology and the partnership with us for those longer term needs. we are not that far off. kairos is focused on the deployment of a smaller demonstration reactor, the hermes reactor in tennessee in just the next few years. that really sets the stage for these deployments with google, with the first commercial scale reactor targeting to be online by 2030. >> right. you mentioned that demonstration reactor. you also say you're going to build on the progress from the early iterations, and then each new plant will enable continued learning and optimization to support accelerated commercialization. what gives you the confidence that you're going to be able to continue to iterate to meet these development targets that are cited there, and you know, essentially, provide the power

that you're promising google? >> yeah, great question, david. so, nuclear power suffers from two challenges, and they're both really, really big. the first one is just high cost, and so having the technology and the development and the deployment process to drive down cost is essential. the other is cost certainty, and the combination of those makes new project development extr extremely challenging. it's not just about the technology. a lot of it is about the process for deployment and for kairos, we have a novel iterative approach. we have a full-scale test for our hermes reactor, which we've completed running. we're breaking down right now in albuquerque, and we're going to build another one over the next few months as we get more pr prototypic of the system. it allows us to understand the real cost of the system, and then the hermes reactor also allows us to really understand what the construction risks are

and to do it at smaller scale and much lower cost than the commercial scale. so, we have all that information coming in, so when we get to the projects and the plants for google, they're really not first of a kind systems. they're building off of all that real construction build experience that we're developing right now. >> and then mike, what about the safety concerns? i keep bringing this up. it's all happening to fast, and investors are so excited about it and the tech companies are so excited about it. but are people really excited about having nuclear reactors in their districts? what about the radioactive waste concerns we were all so scared of and thought we would never see another reactor online in this country or in europe again? >> yeah, so, there are a couple different aspects of the safety. the first is, this is a regulated technology, and so the nuclear regulatory commission is highly competent. they're viewed as the world leader and they set the standard for their technical expertise on a lot of different technologies. we're excited that we have the construction for hermes. the safety case for our

commercial reactors is actually exactly the same. we have that to build on as we build confidence in the safety system. our technology, one of the things that was really attractive about it was, it combines two proven nuclear technologies in a novel way, and it provides a system with very high, robust, intrinsic safety, and that means that we're actually, i think, less subject to changes in the design that we can iterate and improve are not going to have impacts on the regulatory side. that said, community engagement is absolutely essential. kairos believes that engaging and being transparent with all the communities that we operate in, in california, in albuquerque, and in tennessee, is vital in building that trust and we'll use that as we move forward to identify the specific sites for the future projects for kairos and google. >> you mentioned regulatory influence. we've been asking a lot of industry players the last couple of weeks whether or not the regulators are taking a lighter touch than you might have expected when you were building

your plan. or is it too early to tell? >> it's -- this is a new technology, and so it's difficult to compare it one for one to the previous experience. i will say that we have a huge number of hours on the nrc side and the review of our construction, permit application. we have a lot of preconstruction engagement with the nrc and we think a highly informed and educated regulator, they're coming back with good questions. our team is working through the technical details. i don't think it's a light touch at all, but i think that it's been fair. they've been able to give us a schedule and we've been able to meet our commitments to give them the information that they've asked for, and in turn, they've been able to do timely review. we have a lot of confidence that the experience we have for hermes will translates into predictable regulatory timelines for the commercial plants. >> finally, mike, i would imagine none of this is cheap and i'm just curious, from kairos' perspective, google, you describe as a partner.

are they making a capital commitment to you or is it simply enough that the offtake ruchbs are going to allow you to raise the capital you need to do this buildout? >> i can't speak to the financials details of the agreement with google. i will say that developing any new energy technology is going to be capital intensive, and this effort is no different. what i do think is valuable is in the kairos approach with the iterations, we're able to learn a lot of the information much earlier and at much lower cost and so we've been able to review a whole set of experiences from our non-nuclear test program and when we review that with our advisors who have a lot of experience from the larger, conventional, reactor builds, they see the lessons we've learned, and we've been able to accomplish many of those same lessons much faster and at really a tiny fraction of the cost, and so that's -- >> right. all right. but -- all right, so, google's

not going to turn around and go, you know, you guys aren't going to run out of money and not be able to deliver, right? i would imagine google has confidence in your ability to deliver what you're saying. >> sure. kairos and google have been working on this and really established a high level of trust and partnership in here. they've seen our commitments. we've just announced an exprangs of our facility in albuquerque, new mexico. that's where we're doing large-scale non-nuclear testing. we have a lot of development manufacturing activities there. they see the investments, the ongoing investments. kairos is in this for the long haul and we're building the capital infrastructure that's going to make not just hermes but also these commercial plans feasible and realistic. >> we're going to continue to check in along the way and hope you'll allow us to do that. nice to have you. >> thank you so much for having me, david. let's get a news update now, over to kate rooney. >> hey, david. good morning. israeli strikes killed nearly 21 people across lebanon since tuesday as the israeli military continues an air and ground offensive in that country.

lebanese officials say 15 of those deaths came in a southern town where rescuers are still searching for survivors trapped in the rubble. nebraska's supreme court, meanwhile, determined this morning that people convicted of felonies have the right to vote after they serve their sentences. the state's high court said in that ruling nebraska's secretary of state did not have the authority to order elections officials to reject their voter registrations. and finally, axiom space and prada unveiling their new space suit design for nasa's artemis mission. the suits can withstand extreme temperatures and enable astronauts to perform spacewalks of at least eight hours. they include custom gloves, on-board diagnostic system for crew members and a carbon dioxide scrubbing system. >> they'll be chic because they're from prada. >> chic. >> most importantly for the astronauts. >> exactly. thank you, kate.

we're going to take a quick break here. markets are in rally mode. we're building on strength this morning, up 0.25% after losses yesterday. nasdaq, though, unchanged as tech la. 'rba itwo.gs (♪♪) in life, i'm reminded that it's not about the destination. it is truly about the journey. (cheering) (♪♪) (♪♪) (♪♪) (♪♪) (♪♪)

i can't believe you corporate types are still calling each other rock stars. you're a rock star. we're all rock stars. oooo look look at my data driven insights, i'm a rock star. great job putting finance and hr on one platform with workday. thank you! guys, can you keep it down. i'm working. you people are (guitar noises). hand over the air guitar. i've got another one.

oo stocks are coming back. s&p is up a little more t than .1%. nasdaq, unchanged. our next guest says that despite all the soft landing and fed rate cut optimism, the s&p 500's big rally has simply overshot, adding that overvaluation not earnings is the biggest obstacle for more gains from here. joining us is barry banister, stifel's chief equity strategist. you don't buy the fact that as long as the economic data comes in fine, the fed's cutting rates, and inflation doesn't perk back up too much, path of least resistance is higher? >> well, path of least resistance has some bearing on valuation as well. we did a note two weeks ago saying that the market looked like it was about two multiples

too high. each multiple is about $250 of s&p earnings on a forward basis, so that's about 500 points. the s&p would be worth about 5,300 a, but you're right. unless we have some clarity on whether it's an extreme soft landing, yes, in the middle, but you could have a hard landing. you could easily have no landing, which would take rate cuts off the table next year. i think the risk is pretty high right now. >> so, you -- wait. sorry. you think the risk is high of a correction on the idea of a no landing? if it's a no landing, the market might not be thrilled with that, but it does mean that the economy's in great shape. >> well, a really detailed analysis of inflation, which, in this brand-new era of populism, is not -- it's not going to stay

quiescent forever. in other words, on a long-term basis, it's over and dead and gone. we're in a valley between two moves in inflation. the next one won't be as high as what we saw in 2022, but we're in a valley and it's a misleading optimism in the market to believe that inflation has been whipped. we're going to see quite a bit of fiscal, no matter who wins in this election. quite a bit of fiscal, because that's what the public demands. they want fiscal. >> unless the bond market rejects it, of course. what do you do? what are you telling your clients to do if you think the market is too expensive and you're worried about spending, which could hurt bonds as well? >> there was a slight move after the strong payroll number, but total government debt held by the public is only 30% of nonfinancial debt. that's actually fairly low. we have no term premium in the market, meaning the costs are

price of duration risk. that means that the yield is actually very low on ten-year treasurys. so, we could issue more debt, and i think the politicians know that. so, as far as we look out into the future, we think valuation is just very stretched. we are following a composite of past bubbles so we could go higher, but unfortunately, when the inflation perks up and the fed mid-decade is forced to reckon with that, then we're going to go straight back down, and it kind of begs the question, what's the point? >> all right, barry, well, that's an alternative view. thank you for joining us, though, with it. appreciate it. >> thank you. >> highlighting some of the risks out there. barry banister of stifel. less than a month from cnbc's annual delivering alpha investor summit. it's a big deal for us every year here in new york city. it's happening on november 13th. the street's top investors and leaders will be convening to provide insight, analysis to help you deliver meaningful returns. i'll be there speaking with the

always-outspoken nelson peltz of trian. i know you're going to be there moderating a panel with ben affleck. interesting. to register, you can go to cnbc.com/deliveringalpha or scan the qr code right there on the screen. and what's great, david, about it this year is that it comes right after the presidential election, so we will hopefully get some direction from some of the top names in investment on what to do and how they look at the world differently, given, hopefully, we'll have some results by then. >> good point, by the way. would expect we would by the 13th, but it's certainly not going to be on election night where we're going to have a real sense for the winner. it's possible, but so many of these mail-in votes only begin to be counted on election day, for example, i believe in pennsylvania. >> and you saw the first day of early voting in georgia where the numbers are blowing out any prior cycles. it's going to be a fascinating

night. and maybe weeks, series of weeks and months. >> last -- in 2020, it was, what, saturday before -- on that tuesday, of course, was the vote. it may take a while, but by the time you're talking to nelson peltz, he's going to know whether his guy has won or not. >> he's a supporter of donald trump, was before as well, after a brief hiatus. last time, he was upset after january 6th, but he's come back. i was just going to say, i don't think ben affleck has been at delivering alpha. this is his debut. >> i don't see him coming back either, but you never know. he may have such an incredible experience that he'll become a regular. but he's, you know, it's not just about him being on camera or even behind the camera as a director. he's also very much involved in the business side as well, in terms of producing, and he's got a lot of interesting things to say about the changes in hollywood that he thinks should occur. >> delivering affleck is what we need to rename it. >> there we go. after the break, the world's richest man putting his money to work in the '24 election, some details on how much elon musk

has spent to support a second trp rm umte. is it me... or is work not working? at least, not the way it could work. your people are buried in busy work. and you might be thinking... can ai make it all work? it can. on the servicenow platform, ai transforms your entire business. your people work better, your customers are happier, and todd... well... he's practically euphoric. practically. so, let's get to work. (♪♪) (♪♪) car, this isn't the way home. that's right james, it isn't. car, where are we going? we're here. (♪♪) surprise!!! the future isn't scary. not investing in it is. car, were you in on this? nothing gets by you james. nasdaq-100 innovators. one etf. before investing, carefully read and consider fund investment objectives, risks, charges, expenses

and more in prospectus at invesco.com

the big banks get all the big headlines, but could their sma smaller siblings in the regional banking business actually be the better trade in the months ahead? find out what the charts could be saying during our market navigator segment later today. tamra, izzy and emma... they respond to emails with phone-calls... and they don't "circle back" they're already there. they wear business sneakers

and pad their keyboards with something that makes their clickety- clacking... clickety-clackier. but no one loves logistics as much as they do. you need tamra, izzy and emma. they need a retirement plan. work with principal so we can help you with a retirement and benefits plan that's right for your team. let our expertise round out yours. we have had some wild moves in shares of truth social media, parent trump media this week, shares rallying today after a volatile session that saw the stock surge more than 13% yesterday before turning sharply lower and triggering that trading halt in the afternoon, which you might have seen, eventually closed down double digits. 97 million shares traded hands yesterday, almost triple the ten-day average. shares are up more than 70% this month alone but of course well off the 70-plus dollar high earlier in the year, and that draft downward came right after he finished speaking at the

economic club of chicago yesterday. >> i mean, do we think it moves generally with the betting odds of a trump victory? does that question -- i don't know. >> i mean, i think, i mean, sara, others might point to small cap cyclicals and bitcoin on that front. >> it's not move, david, on roou ro revenues or fundamentals of the business. it's not moving on any investor calls. so, yeah, probably just the retail enthusiasm around the trump winning. >> it's got to be. listen, there's a couple of other names that i've mentioned before, which are fannie and freddie, the government-sponsored entities that help support the mortgage market. the trump administration previously tried to take them out of conservatorship. interesting to watch. keep an eye on those preferreds as well, because if he were to win, at least there's an expectation, perhaps, they'd try again on that front. let's move on to the -- stay on the election front. new filings showing elon musk

has donated tens of millions of dollars to what is his pro-trump pac. emily wilkins joins us now with details. >> hey, david. elon musk, for nearly $75 million into backing republicans through his america pact. that makes him one of the largest republican donors so far of the 2024 election. now, this new filing was released last night, but it really only covers musk personal donations to the pac through the end of september. but we know more about what the pac has sent so far in october. if we want to add it all up, all the funding so far this year, in total, musk's america pac has spent $113 million. most of that, pac has spent 113 million. 102 million backing trump, the rest has gone to down ballot races, largely to competitive house races and that funding is really critical right now for the house gop, the house itself is considered a tossup. house republicans have been

trailing their democratic counter parts in fundraising. of course this is only musk's america pac. he has given to other super pacs, including a million dollars to a pac run by conservative influencer scott p p pressler focused on registering republicans and getting them to vote early. he announced he will be doing a series of talks in the key swing state in pennsylvania. you have to have voted in pennsylvania and signed his petition backing free speech and second amendment rights. and that speech includes giving him your flame, e-mail and cell phone number. that's critical data that a lot of campaigns want to have. musk is collecting a lot of it with his petition and now these speeches. >> what does the research and data show on the correlation of spending and how much money and fundraising candidates are able to bring in and their likelihood of winning and whether that money pays off.

what have we learned from the last elections or local elections, is it really a key factor? >> some of these races, the amount of money we're seeing spend. you're comparing tens of millions on one side to tens of millions on another side. some of this additional funding could make a difference, get more folks out on the doors, knocking on doors, phone banking, reaching out to people. that's actually what musk has focused a lot of his spending on. it's not on flashing ads, it's on knocking on doors and doing calls. at this point, there is a certain level where the amount of money doesn't matter as much anymore. musk is clearly targeting the close races where it will. >> emily wilkins, in washington. airbnb rolling out new features for hosts and users. and this hour, a condo crisis in south florida, one that started well before t he latest string of devastating hurricanes. we'll tell you that story when

we come back. don't go anywhere.

the con do market in south florida may be a crisis. related to the wave of recent weather hitting the state,

robert post to explain. >> good to see you. south florida seeing a jump of inventory of unsold homes before the hurricanes helene and milton. listings in coral gables, and del rey beach up 70% in september. west palm beach, wellington, fort lauderdale, 60% increases in inventory. prices have started falling as well. in miami, prices down 12%. that's the biggest drop of any major housing market in the country. jacksonville, orlando, tampa, seeing price drops of 5% or more. the hurricanes are likely to lead to more listings, and a new law that requires those condo buildings to fund large cash reserves has led to a glut of older condos on the market. you have those insurance costs causing wealthy buyers to look elsewhere. signed contracts from miami homes are down 57%. in palm beach, contracts over 5 million falling 50%. for more on whether the florida dream may be fading, don't miss

my live conversation friday with billionaire real estate investor, jeff green. a first live discussion on inside wealth. scan the qr code right there or head to cnbc.com/insidewealth live to register. that's going to be very timely given that he bet on the housing bubble in 2007 and maetde a lotf money. now he has a lot of projects in west palm beach. >> palm beach has gone up so much. put it in perspective. >> some of those houses tripling since 2019, so even if you look at prices could come down dramatically, and you would still be above 2019. inventory, as much as it's grown, 60, 70%, still about equal or slightly above 2019 levels. so, again, it's an unnatural level that we are at, coming down to normal. >> all right. robert, thank you. >> thank you, guys. >> robert frank, don't miss that conversation as well. as for the conversation here, well, it's certainly going to continue with the s&p up .09%. we're back right after this.

good wednesday morning, welcome to money movers, i'm carl