it's jobs report friday. it's november 1st, yup, november, 2024 "squawk box" begins right now. good morning, everybody. welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. it's a friday, it's all saints day. the day after halloween. the markets are feeling a little bit up dow up almost triple digits. up 95. the nasdaq up 70 let's take a look at treasury yields and at this point, the ten-year is below 4.30

the two-year is 4.29 the jobs report will have the eyes of the equity and treasury markets. in the meantime, take a look at the shares of amazon. moving higher by 6%. earnings of $1.43 per share. beat the estimate. revenue beating expectations ad revenue in line with the cloud revenue growth of 19%. that was the biggie. still lagging the growth from microsoft. andy jassy saying the company's plans to spend cap ex in 2024 and expect to spend more in 2025 he said generative a.i. is driving that cost. intel shares rising and the company reported adjusted earnings of 17 cents per share versus a loss of 2 cents

let's show you pat gelsinger on "closing bell overtime." >> great progress on business and foundry and a beat and raise. obviously, the markets are responding positively, but our view is we have a lot of work to do and a lot done this quarter a really solid quarter of execution. >> the quarter guidance coming in above analysts' estimates. >> usually if it bleeds, it bleeds this is how i would have done this story this is gap. we don't always do gap to report a loss of $16.6 billion which includes write cou downs for technology equipment and depreciation all that as gelsinger is turning the company around the largest loss in intel's history. revenue down 6% decline. then the expectations for the

current quarter were not as bad as people thought. the stock, which is, you know, was actually almost under 20, is bouncing a little bit this morning. i don't know >> the write down was anticipated? >> not to that exttextent expected loss. >> expected to what is happening -- >> why did the analyst expect the loss of 1.1 billion? it was 16.6. that's a big number. >> it is >> 16.6 billion. let's talk apple shares down this morning after fourth quarter results. the company beat expectations on the top and bottom lines, but a one-time payment to ireland to settle the dispute over back

taxes. the higher margin services business is now generating $100 billion a year joining us right now is one of the analysts on the call from bank of america securities waymsee, most of the stock was pr pretty good. was a little below what had been expected is that what you attribute the decline in the stock price or something else >> good morning, becky i think most of the metrics were more or less in line iphone was better than expected. this was a little bit weaker and gross margins were strong. i think the reason the stock is r indicated lower is the guidance. the guidance consensus is 6% to 7% growth in the quarter the company guided to a low single to mid single digit

increase on a year on year basis. the top line was weaker. this was largely, you know, signal and understood by the buy side with the data points. it was a slightly slower start to the apple intelligence rollout. we think another factor could be the fact there is a cfo transition under way remember, apple does want to set this up in a way where the incoming ceo does not want to be the first one on the call reporting numbers. the bar is also intentionally being set a little bit lower just to make sure the cfo transition is a smooth transition >> all right overall, though, the number for apple iphone, the iphone 16, those were stronger sales than had been anticipated that is quite the opposite of what the analyst community had been expecting up to this point. >> becky, you only have about a week of sales in the september quarter. the iphone upside was largely

driven by the 15 cycle was still ending on a reasonably positive rate largely driven by low single digit growth in units and low single digit units the 16 cycle should be better. if you do the math with the sequentials and what it implies for hardware, generally that really is not possible without iphone growth. iphone is continuing to grow it's the rate and pace that is under question we remind people this is a different cycle from every cycle we have seen continual updates which means the cadence of the rollout within that contention, we also think the mix from the pro is strong we do think it sets up for a reasonably good cycle, but we're really positive on the fact this is a multiyear cycle as the

rollout happens across different re regions, you get the propensity to upgrade >> when it gets to the services business, a little weaker than anticipated. is that a concern for you or no? >> look, we did take our marginally if you look at the estimate changes, our revenues went down $5 billion $448 billion to 4$423 billion n the context of apple, it is not a matter of the number it is 4 cents on eps on 750 base, right? again, numbers didn't move a lot. although revenues wouldn't down, the gross margins were very strong the guided gross margins were strong for the first time in apple's history, they have a 47 number in the range which is incredible this is par where gross margins

are going from 45 to 50% in the last decade, we have seen them expand from 35 to 45. we will see the expansion run up to 50. it is out performing we like the set up over here we think the marginal changes are significant. >> do you have a price target for the stock? >> yeah. 256 for the stock. >> okay. well above where it is now 223 is where the stock trades down 1%. wamsi, thanks for your time. >> thanks for having me. >> i can't let this go cuban is a clown, i think. this is the news cycle just thinking about it i'll not talk about it politically. i don't think weak women exist i don't know a weak -- in my personal life, my daughter, my wife, in my professional life. i think it's an oxymoron

do you anywhere do you know a weak woman just the idea. trump must be -- you know, batting or looking all around. if he has found some, i have not. i'm talking about strong women in my life you can say something about this you don't -- >> i don't have -- you -- you -- you have a bit for this. i don't have a bit for this. >> your wife don't you know a lot of strong women? >> she is super woman in my life. >> think about the weakest woman. i couldn't come up with a single one. thanks, mark, stupid comment i guess because it was so glaringly. we went to dinner last night blake. wow. strong the one -- i'm weak. i'll be the first to cop to that in many ways i wish you could work with me on this i think it's pretty simple >> work with the strongest woman

you have on the set here. >> only one woman on the set there's only one -- you're not going to cop to being a strong woman. >> sure, i am. >> we have one sitting in the control room running the show. we have a lot coming up on "squawk box" this morning. boeing and the machinist union reached a contract they are urging to vote for it phil lebeau has the details. next, chevron and exxon will report this morning. we have the exclusive interview with darren woods coming up. "squawk box" after this. >> announcer: this cnbc program is sponsored by baird. visit bairddifference.com.

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it's our son, he is always up in our business. it's the verizon 5g [hhome internet i got us.er] oh... he used to be a competitive gamer but with the higher lag, he can't keep up with his squad. so now we're his “squad”. what are kevin's plans for the fall? he's going to college. out of state, yeah. -yeah in the fall. change of plans, i've decided to stay local. oh excellent! oh that's great! why would i ever leave this? -aw! we will do anything to get him gaming again. you and kevin need to fix this internet situation. heard my name! i swear to god, kevin! -we told you to wait in the car. everyone in my old squad has xfinity.

less lag, better gaming! i'm gonna need to charge you for three people. boeing and its machinists union negotiated a new contract offer and urging the members to vote for it. we have phil lebeau here with more >> reporter: joe, let's see if 30 time's the charm in getting the contract doeal done here is the agreement and the machine evists voting on the raise is 38% over four years. the previous offer was 35% the very first offer was 25% they've enhanced the 401(k) match that the company makes to the machinist union. you have a $12,000 signing bonus if you are a rank-and-file member once the contract is approved they will be voting on monday.

remember, during the last vote, which was a couple of weeks ago, 64% rejected the contract offer that was on the table. that was an improvement from the very first vote where 96% rejected the offer that was on the table. so about 33,000 members will be voting they will vote on monday yes, the union leadership recommended it be approved they put it in front of the members the first time and said this is a good deal. let's see if that matters at all. at the end of the day, it comes down to economics and if the enhanced offer is recommended by the rank-and-file. if you look at the shares of boeing since the strike started september 12th, this cost the company an estimated $1 billion per month and we're coming up on that second month when we get to the middle of november where they have not had production for the 737 max and the other aircraft made in the puget sound

area she shore they shored up the balance sheet. they lost $1.2 billion in the third quarter. kelly ortberg is clear this is priority number one. they worked with the acting labor secretary and union in order to get this done let's see if they cross the finish line on monday. >> all right very good, phil. it's taken forever, but i guess it could be worse. >> is this the best and final offer, you think, phil >> we have heard that before >> i think it's pretty darn close. that $12,000 signing bonus, becky, i think that may be the sweetener that gets the rank-and-file members who have been out of work since mid-september. >> a big chunk of cash right now. >> i'd go back. >> yeah. >> it looks like the market's thinking that. thanks, phil chevron out with quarterly

results. they came in with earnings of $2.51 a share. that is better than 2.41 revenue was better than estimates. cash flow at $9.7 billion in the quarter and worldwide net oil production increased 7% over the prior year with u.s. and permian basin production setting another record chevron expects to close asset sales in canada and congo in the fourth quarter to divest $10 billion in 2028. cost cuts are under way. they are targeting $2 billion of cost reductions between now and the end of 2026. that's new news that the street had not heard about before the stock is up 2.5% i did speak with mike wirth,

ceo, he will talk on "squawk on the street." he called it a good quarter. he pointed out cash flow is the highest this year. we mentioned they have been giving cash back to shareholders $7.7 billion that is $2.9 billion in dividend payments he said that is about two times the share energy index peers are faced with they are close to 10% return to shareholders the big question of what happens next whether they will be able to go ahead with the purchase of hess that arbitration is still on track for may. there is still a big question. they are battling with exxon of right of first refusal with the guyana assets involved with that i talked to him about what it means for a trump or harris administration he pointed out he worked with both administrations in the past he said what he would like more than anything is to see

continuity in the rules because they are making long-term investments for any of the major investments you are looking at with fossil fuels, they take long cycle investments and spend billions of dollars and they would like certainty with any of this he did point out under president biden, it is not a friendly administration, but they worked with that anyway and they are looking at record levels of oil production they are putting out. they said they would be over 1 million barrels a day in the permian. a decade ago, it was less tthan one tenth of that. if you have trump administration, it is drill, baby, drill. you think you are already doing that and you don't want to hit more in production and the permian may be plateauing out, too. we will see what happens with that right now, the stock is up 2.8%. >> another ceo that doesn't want -- i like both.

>> he pointed out to me he had to correct a lot of stuff. >> no one's going to say i would rather have trump. >> he said the biden administration has not been friendly is how he characterized it >> you would be crazy to say either side. it's tuesday coming might as well wait. coming up, sony suing cbs over licensing revenue for two popular game shows a great idea the boomer update every morning. a boomer friday update on this "wheel of fortune" and "jeopardy!." later, elon musk sweep stakes is seeking to continue after the federal lawsuit. we'll bring you the latest as "squawk box" is coming right back of something bigger? thank goodness we called his cardiologist because these were signs of attr-cm, a rare and serious disease...

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sony pictures television suing cbs studios accusing i leaving millions of dollars on the table over "wheel of fortune" and "jeopardy!. they have an agreement that goes back 35 years. remember, merv griffin isn't working aggressively to maximize refvenue to license the s shows. flat to 2% growth in licensing revenue year after yoear. when sony got involved, licensing fees immediately grew 17%.

>> sorry, this sauis all we can get. >> i speak coto this. this is fun watching ken jennings there are times he gets annoyed with the contestants he knows every answer. he said he already knew. he's weird >> alex trebek had the answers >> ken really does know, i think, from what he can tell and ryan, is ryan not good is there anything he's not good at ryan seacrest? >> i still think faber shoutout to david faber. he knows >> i love faber. ken jennings they tried mayim people were like, please then ken got the job full-time two major changes in the shows you know, vanna, she's hanging in there

she's great. i told you, boomer this is such a boomer update people at home -- >> what show let's talk about this. starbucks news chairman emeritus howard schultz w weighing in on brian niccol. he was impressed he said he heard from many partners about the call to action and strategy. he is looking forward to quote following the journey. shares of starbucks flat for the week on the earnings they threw the kitchen sink in and said give us a year, we'll call you. >> that's smart. he needs time. >> a lot of folks i heard about brian niccol after the interview was the concept of getting back to those obviously, it is going to be complicated. the mobile ordering piece and you simplify the menu and high

margin products. if you fix the through-put piece, that is the whole game for them, you can actually change it. >> he's an operator. you could hear that with his planning you give him time and people will obviously have faith in him based on what he has done. >> totally he has the credibility the talkstock still up given the numbers at what happened at the company the past quarter or two stock is still up remarkably >> the question is how much patience the investors have to play out. when we come back, we heard from chevron exxonmobil supporis up next. we will have an interview with darren woods we adashe to break, let's take a look at yesterday's s&p 500 winners and losers >> announcer: executive edge is sponsored by at&t business next level moments need the next level network. that

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good morning welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square.

i'm joe kernen with becky quick and andrew ross sorkin the nasdaq, that was pretty ugly yesterday after microsoft and meta. >> yeah. >> little bit better today amazon helping out a big jobs number coming this morning. on the first day of the month which is not something that you normally get let's take a look at shares of exxonmobil. that company just out with the earnings it looks like earnings came in at $1.92 a share that's better than the street was expecting. the oil giant achieved its highest liquids production in over 40 years with 3.2 million barrels a day. cash flow during the quarter, $17.6 billion. free cash flow at $11.3 billion and exxon returning $9.8 billion to shareholders during the quarter. it is raising its dividend to 99

cents a share. you can see the stock up on the news up over 1.5%. their third quarter end debt-to-capital ratio is 5%. we will be taking a look at much more of what's happening with the company. we will speak with darren woods in the next hour on "squawk box. that stock up by 1.5%. more large companies are ordering workers back to the office we talked about the market which has a long way to go exclusive new numbers out this morning showing how far it has to go. we go straight over to diana olick with the details on that good morning >> reporter: good morning, an andrew i'm talking about the debt office delinquency rate jumped 101 basis points in october from

september to 9.37% this according to the report from trek to be released later today. the last time office debt desk indu distress was this high was 2017. it made up 60% of the new delinquent loan amount in october. interesting, the main driver was one manhattan office building at worldwide plaza. decreasing the footprint last month and then the law firm with 30% of the leasable area in the august lease expiration date why do we care about one building according to trek, there are several large office assets like this in cmbs that are single asset and single borrower or sasb it is a bond backed by one building, but grown to a $300 billion market several of these are nearing

delinquency because of the super size, they could push the headline overall office delinquency number way up. what's the trickle down impact according to analysts, it puts an even more negative per perception, if you can, on the broader market workers in the strategy may decide for other smaller buildings it is just not worth it it is a theory the office market has bottomed out and slowly coming back mostly for the newer buildings andrew >> thank you, diana. it's fascinating if everybody comes back to work what do you think? we're all here i don't know i don't know, diana. >> reporter: obviously i'm not, but it's friday, right >> is it >> fri-yay, as they say. >> i was laughing because i was looking ahead to arthur.

arthur brooks, harvard professor is talking about happiness he is just about ready to throw in the towel and give it up. he's at wits end watch, he won't appear to be when we talk to him. he's going to be totally positive he does concede that this election has a lot of people on edge >> he's zen and i'm looking forward to him calming me. >> in the notes, it says i've never seen it this bad. and new york jets owner woody johnson. he can comeon and be happy wit what happened at the end of the game i wondered if he canceled if it turned out differently he will be in a good mood. we'll be right back. >> announcer: this cnbc program is sponsored by baird. visit bairddifference.com. into.

right now, an update on the

attempt by the philadelphia dus strict attorney to block elon musk's million dollar sweepstakes. the judge said it would be heard in the federal court, but the d.a. requested it be isn't back to the court it is not clear how quick the judge will rule on the case or halt the give aways. musk did not show up for yesterday's hearing, but his lawyers did attend. we are in the home stretch of the 2024 campaign season with voters heading to the polls on tuesday. joining us now for a look at the mood of the country is arthur brooks he is a columnist for "the atlantic" and podcast host and author of "build the life you want." thanks for joining us. >> nice to see you >> we're almost there. the mood is -- you would characterize it as somewhat

dark we should put it in perspective. it's an election it doesn't directly impact our day-to-day lives like family matters and work matters and everything else. >> for sure. >> you need to keep it in perspective. when i look at the election, i look at previous periods periods of complete tumult followed by complete togetherness and feeling of, you know, the country is together. it's happened before i remember -- i don't remember the eisenhower years i think i was born in that and then i remember the '70s the '60s and '70s were tumultous. then the '80s. >> we go through this. there are not elections that are not bitter this is how competition works. we as americans are lucky to live in a culture characterized by competition and we love it. the free enterprise system brings us wonderful things and innovation and what we talk

about on "squawk box" because of competition. politics, we call it democracy we don't want uncontested elections and 20-year runs with nobody running for office. the cost of that is we disagree with each other. i want more of this. you want more of that and we duke it out. the key thing is not letting it ruining your life. not remembering competition, but the home you go to with the love of family and love of god, the things we care about those are the non-competitive spaces. >> my son will tell me how bad the reagan years son, someone read a chapter. >> in a history book >> that's what they came up with maybe certain pockets of society. as i remember the '80s and '90s and bill clinton in the '90s didn't seem like that now. i wonder if we can get back to

that with how crazy things are right now. >> for sure. >> people who think things were awful and now we accept. it is almost upside down will that ever go back to normal >> that dynamic has always been the case things are turning upside down one after another and we look back with a little bit more fondness there is a phenomenal called fading affect bias you learn from the past and you remember it as better than it was. in the '80s, my parents, holy cow. b left-wing family now those are the golden years. >> it depends on your p persp perspective. if you were in the '80s and lost your job >> after that, everything went better >> there was iran contra which was a real scandal people felt really bad about it. here's what you need to keep in

mind we have gone through worse we will have times of relative quiet compared to this, but america keeps going, markets keep working, democracy is working. we still have our families everybody still wants to come here. >> if it is trump, half of the country is going to be -- i don't know >> half of the country will be mad either way. >> the other way, it will, too half the country will leave the united states, supposedly. >> no, no. >> here's my question in is it different this time, what is the difference of social media and riling up the extremes on both sides and feeding you what you think or predisposed to think and amping you up on the a antagonistic feelings? >> for sure. what is happening is we are overdosing on information. that's what happens with the screen in our pockets. the screen which is ever

present. watch tv in the morning, read the newspaper and go on with your day that's the healthy way to do this this is not unprecedented the bitterness you are feeling america is going to be fine. the cost of this is the information binging is making us less happy thinking what is going on in washington, d.c. is really going to affect your life? >> if you explain this and you look at the studies and polls, you know, a decade or two decades ago, 20% of americans actually thought that whoever the president was mattered to them personally. today, the number is 60% or 70% in the uniquely tribal situation. what is that that people have decided? if two decades ago people thought the president, fine, whoever it is. i can survive. it's not going to change their life so materially and now believe that he is going to change their life so materially

even though the statistics would suggest, i imagine, or hop hopefully, maybe it won't. i know this particular election, people genuinely believe, he could change their lives maybe there is an argument it would and could change your life >> for a vast majority of americans what can change your life, not dramatically, but somewhat is local politics and local action what is happening in your community. that is exactly what people are not getting involved with. what happens with the ever present media in everybody's face all the time is they start to believe that citizenship means being sufficiently outraged by what is going on in washington, d.c. that's wrong that's not citizenship so, what's happening is the information overload, 20 or 30 or 40 years ago, does this matter a lot people say it's politics i want one person to win in the '80s, people were really upset when their person didn't win, they didn't see it all day

long and weren't tortured constantly and if they don't pay sufficient attention, something might go wrong >> is it part -- >> both sides have the things they're most worried about people worried about reproductive rights and on the other hand, people are worried their cities are overrun by, by, by people to live in hotels. >> where i was going to go with this. >> and crime and then with inflation. pay paychecks. >> to me, the distinction and is that there is a real impact on the very local basis meaning, if you are a woman today, that's a very local issue for you. i'm not talking about -- no, no, that's a real issue that demonstrably changed their lives. hang on. the other distinction is taxes taxes impact your, your, your

wallet -- >> right. >> it used to be the debate was between 35% and 37% or 33% we were talking about sort of marginal differences, right? >> right. >> now we're into a whole other landscape where the distinction between what people think is both san acceptable and what on side is asking for and the other side is asking for are like night and day. that actually, i think, is a real thing to people. >> you know, we have to keep this in perspective. people were really worried about abortion rights in the 1980s and 1990s. they were talking about it in a fundamental rway. they will take your rights away. with we could an less around policies taxes were wacky if you go back to the 1950s and 1960s with 90% marginal rates and carveouts and

now simply what is going on, we've had this relative period of consensus around 37%. >> hence cities in some of the greatest, formerly greatest cities in a drug store, you need to ask someone to come over to open the razor blades to take them. there is a lot of crime. >> there is. most people live around the country and the cvs is the same cvs as last year people see images of something far away not just social media, but just too much of everything look, here's the deal. we're going to have an election. for half the country, it's going to be a bummer for half the country, it will be a relief got it what do you do today turn off media go love your kids. call a friend. say your prayers do. the stuff that's always been there that always should be there because your life is your life and then say god bless

america where we can have these crazy elections and have these arguments, but no matter what, i still have my family and i still have my job. >> for now >> right >> all right arthur, thank you. >> thank you >> okay. >> feel better >> a little, but i wish you'd stay the rest of the show. >> and then come over? you got an extra room? programming note, cnbc will be live all night on election night. we'll have the results as they come in and reaction from some of the biggest names in business it all starts at 7:00 p.m. eastern and "squawk box" will be starting an hour early at 5:00 a.m. the following day 2:30 wake-up call. we'll be right back. >> announcer: this cnbc program is sponsored by truist securities experience, expertise, execution.

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ford is pausing production of its electric f-150 lightning pickup truck for several weeks the company says that it will idle the plant that makes that truck for mid-november to january 6th. ford cut the price of the lightning amid a decrease in interest from consumers. ford also had permanently cut a shift at the plant coming up when we return, employment data that could move the markets and influence the fed's next decision. we're going to get you ready for today's job report next. check out shares of boeing, the company reached an agreement with its striking machinist union on a new contract offer. we'll have more on that story at the top of the hour. "squawk box" coming back after this

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the october -- we're counting down to the october jobs report due out at 8:30 eastern time today it is expected to be distorted perhaps by some special factors like the recent strikes and hurricanes but that has not seemed to impact some of the adp numbers we had or at least we thought we had on wednesday want to bring in michelle girouard, head of u.s. coverage of nat west. what are you expecting on the jobs end >> we were surprised by the strength in those adp numbers. actually the data this week were all surprising to the upside, good consumer confidence numbers as well, the claims numbers were

lower than expected. so we're going into this report with seeing some upside momentum and upside risk given the upside surprises. as you said, there are going to be special factors the strike and hurricanes that are, you know, at risk of really depressing the number. it is asymmetric, right? it feels like if the numbers are weak, we'll attribute it to those depressing one-off factors. if the numbers are strong, however it going to reaffirm the economy continues to have good momentum and maybe picking up momentum. >> how would you measure this economy, if you were a professor? >> well, i think right now we're looking in an economy that is continuing to grow at a slightly above trend pace we had great gdp numbers, great in a relative sense. we had very solid gdp numbers this week from the third quarter consumer spending continues to hold in very well and yet you got inflation trending lower it seems like a -- i don't want to say a perfect world, but you

got everything that the fed would want to see where the economy seems to be avoiding a recession and yet you've got -- you don't have the inflation pressures that you had a year ago. so, for right now, i think things are looking healthy everyone is focused on the election and the impact that that could have in terms of the potential for changes in policies that might impact the inflation and the growth story. >> let's talk about that, as you try to think about what the world looks like a week from now with two different candidates, how do you see it in terms of both the inflation picture, what you think tariffs might do, if former president trump wins, if you think there is going to be additional spending under a harris world, maybe you'll see additional spending on both, i don't know. >> right i think we expect that you'll see probably additional spending on both sides. i think a president harris certainly viewed in the markets as more of a status quo. we believe if she's victorious, you'll have a divided

government in that sense, it may not be too different. obviously with the trump presidency, and we believe if he is the winner, we'll see a united government, most likely the odds are a republican sweep in that event. so then you could see more significant changes in policy and i think, you know, not only on the fiscal spending side, and certainly the extension of the tax cuts, but also on the inflation side with the tariffs that have been talked about or we estimated it, with the impact of the 10% increase across the board on imports with 60% increase on china, that could push inflation we think close to 4% so, from our forecast of slightly under 2 at the end of 2025, if they were enacted on day one, there is a lot of uncertainty, but to give you a sense, we would look for higher inflation that would, i think, impact our -- would impact our expectations for how much fed easing we get next year. >> let me ask you separately, i don't know if you saw, elon musk agreeing with this concept and

suggesting there would be at least a form of hardship for the economy for some period of time, especially during what was described as sort of the transition periods where if you were going to really cut government for example, or implement some of the tariffs or other things so when you start to really think about what the economy could look like over next four years, under each candidate, what is your base case >> it is so much will depend on what actually gets put through there are conflicting, you know, factors in terms of president trump on policies. obviously the inflation and tariff impacts could be negative, less fed easing. the regulatory relief we have seen under president trump could be a real positive for the economy, offsetting some of the impact of this transition period so, in the end, i think -- we're like everybody else, sort of waiting to see what actually gets implemented we have seen before a lot of --

there is a lot of talk during the elections, but when push comes to shove, with -- even with a united government, very narrow margins, it is not clear what we'll get through. >> michelle, if we're going to 140% of debt, to gdp, isn't there pain coming at some point? couldn't you make an argument that to do something smart, near term, in terms of what elon musk is going to try to do, and maybe have -- it could be -- you could be putting off something far worse than would happen five or ten years from now, like a depression >> joe, when i think we look at the fiscal picture, we could be sent this even for the last four years. we never have seen the full back and spending post pandemic that you would have thought would put the fiscal situation on a more sustainable path >> we're at 2 trillion we made it down to 1.4 trillion after the pandemic, and no reason to be back at 2 trillion right now and here we are.

no reason. >> and you wonder what -- at what point will the markets and the u.s. take notice and you can see obviously in the uk the reaction of the markets and, you know, with the release of the uk budget which had more fiscal spending, and you are seeing yields rise, and at some point you wonder if the -- if the u.s. we'll see -- again, we're seeing that, i think, already with yields having risen. more concern about the fiscal situation, even in an environment where the fed is potentially cutting rates, yields stay high. >> the cows may be coming home some day may be a day of reckoning. >> there has to be, but when, right? it is just -- exactly. >> if you do the numbers we're at 150% by 2040 or 2050 and we never even have been where we are now at 108% right now. >> we're talking about an economy that is doing pretty well, right? if we go in the recession and need more, so we're all thinking the same thing, but the markets are looking through a lot, yeah.

>> michelle, thank you appreciate it. it is just past 7:00 a.m. here on the east coast you're watching "squawk box" on cnbc i'm andrew ross sorkin with joe kernen and becky quick got a bunch of big stories to talk about this morning. intel reported adjusted earnings of 17 cents per share versus an expected loss of 2 cents revenue beating expectations intel's current quarter guidance came in above analyst estimates, but that does not -- or should not get away from maybe the bigger headline and how much money this company has lost. writing down -- >> $16.6. >> billion with a b, and even independently of that, it raised all sorts of questions about how well intel will be able to put some of the -- >> big transformation, gelsinger and who knows whether he's successful he's trying. >> tough he's trying. he's trying. and, by the way, gina raimondo trying to help him as much as he can. and questions about whether the government taxpayers are

actually going to ultimately be able to benefit from all of this too given we're trying to reshore chip-making here in the u.s. and it is going a lot slower than i think people had hoped for. meantime, amazon shares higher after reporting better than expected earnings and revenue for the latest quarter, driven in part by growth in the cloud computing and ad business. that stock on the move and then striking workers at boeing, they're go to be voting monday on a new contract offer that includes a 38% pay hike over four years and larger signing bonus. the latest offer being endorsed by union leaders who told members they extracted all they could from the company apple shares this morning are a little bit weaker. the last we looked down about 1.4% let's check in with steve kovach with a look at that reaction to apple's earnings this was a little more complex of a quarter maybe than in times past analysts looking at a lot of different moving pieces. >> yeah. there is a lot to unpack here, becky. let me break it down for you apple did beat expectations on

the top and bottom lines but we still see the stock falling here premarket about a percent and a half or so that's because services revenue missed and there was little guidance on iphone sales for the december quarter by the way, something on services, even though missed expectations, it is at $100 billion annual run rate. that's pretty impressive right there. all anyone wanted to hear on the call, though, is apple intelligence going to keep the iphone business growing and they didn't really get an answer to that the only guidance given, top line revenue will grow a bit and services will grow again at double digit percentage points a little color, though, on the early iphone 16 demand i caught up with tim cook on this he told me the first few days of sales were better compared to the iphone 15 during the same period a year ago. and 15 sales were still strong, cook pointed out one reason for that could be the 15 pro still works with apple intelligence. and that could explain in part at least the record september quarter for the iphone business.

also, it was the opposite story of what many analysts thought were happening for those initial iphone 16 sales. in the meantime, apple intelligence just launched this week on monday and cook told me in the first few days more people were updating to the new software than they did a year ago. he called it, quote, a really early start. or stat. still, cook said, they're also tracking how many people turn on apple intelligence after they get that update, but he wouldn't exactly tell me how many still, optimistic about the momentum by pointing out some of the stats. still, we're waiting for more a.i. features to launch. chatgpt integration, for example, is coming in december and even more of the features we see him talk about and new languages they're launching next year still unclear if a.i. is driving that iphone demand for now, the best we got from cook, he says apple intelligence is a compelling reason to upgrade, guys. >> steve, i guess it makes sense the reason that they're not saying more about this as you pointed out, this is a

very early statistic, not a lot they have seen so far. and everyone is going to wait to see what happens with those upgrades on the software, who is downloading them, who is using it, still very early to tell, but probably worth pointing out that what the street thought maybe is not what has developed in the very early days that the people are getting those phones quickly, maybe it is a better -- i think you laid out, the better supply and demand picture they're able to meet that demand because there is more demand for the 16 than the 15 >> yeah, that came up too on the call a little bit. just how everyone was gaming out what those preorder wait time windows were and kind of trying to game out whether that means demand is better or worse compared to last year. and tim cook addressed those concerns and says he doesn't think about it, they're more concerned about getting the demand and supply equal. they say pretty soon they'll be able to meet the demand on the proline, the one people have to wait the longest for, that's typical for these. but, still, a lot of people are

saying now, i've been reading through the notes, reacting this morning from analysts, and they're kind of stretching out their predictions now for how long this cycle is going to go and now predicting they could go even into next year as the features roll out. the big updates, not coming to december, and then into next year, becky. >> okay. steve, thank you coming up, new york jets owner and former u.s. ambassador uk woody johnson joins us to discuss his support for former president trump. and then later, exxonmobil ceo darren woods joins us in a "squawk box" exclusive we'll be right back. the biggest companies deliver an exceptional customer experience. what makes it possible? >> announcer: this cnbc program is sponsored by baird. visit bairddifference.com. d prix chose t-mobile

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joining us now, to talk about the election, new york jets owner woody johnson, former ambassador to the united kingdom. and he is a supporter of donald trump. you have been for quite a while. we can't just gloss over you were there, you saw that -- were you worried the catch was not going to be ruled a touchdown? >> afif you watched part of the game, you would be worried about every single day when the rookie dropped the ball and celebrated before he got into the end zone. >> the coach said, to the refs, this has got to go down for pos posterity, but it was a catch. >> it was a catch. he got the game ball. >> he seemed to be talking about what the odell catch was in honor -- okay, we'll move on to some -- i thought of a way to approach this, andrew, with

something that you talk about a lot. that is the ability of people in the public eye, whether ceos or other, to endorse either candidate and whether it is worth it for you, you got all the jets fans you need to worry about i would imagine, you've been a trump supporter all the way back to -- you've known him your whole life, you have had to deal with stigma by being a trump supporter. have you not >> i guess i have. but i haven't noticed it really. surprisingly i mean, i thought about it, but it never really -- the players, the people don't, you know, go on the other side of the street. >> you don't travel in the circles where that would happen. but now we're hearing that many ceos are afraid to -- >> yeah. >> to endorse kamala harris because if trump is elected, they're going to face some type of reprisal from trump. >> i heard that. >> exactly but i think the other is just as powerful, that there are people -- you have to be insane as a ceo to endorse trump?

you lose half your customers >> i think a ceo of a major company now, you want to stay neutral. >> can i ask a question about this when you talk to people privately and they don't want to come on tv and talk about it, they say asymmetric risk they would say, if there is a possibility of retribution, it would come from trump. and it wouldn't come from her. so, for example, do you believe that you were targeted while biden has been the president on an individual basis, not because he likes higher taxes or whatever you think he likes or doesn't like about the business community, do you believe you have been fundamentally targeted as an owner of the jets or any of your other business interests because you have been involved with -- a supporter of trump you see what i'm saying? >> no, i didn't feel that. not really. >> i think you would agree that jeff bezos was targeted, actively, by trump, publicly so, he actually said it, because he didn't like what was going on at

"the washington post" and therefore said i'm going to go after amazon and i'm going to deal with the post office to make it more expensive for them. you heard that, right? >> i think -- >> we're not mincing words about what happened. people see that. the desantis situation in florida. how do you react to that >> trump didn't do the desantis -- >> take desantis off the -- >> another republican. another bad guy. >> if you're running a major company, you probably want to stay neutral, you know, or go with trump, no, but, you know, because you're representing a broad base, you're making products if you're base, yezos, but he o major publication, "the washington post. so, you really can't say -- i don't know if that was a good move or bad move, but certainly a political move it is a dangerous political move, i think. >> as far as we heard economic

plans and the harris campaign will cite, i don't know, nobel laureates, they'll cite goldman sachs, other studies that show that inflation would be worse under trump, the deficit is estimated by that nonpartisan group, if all the tariffs were to go into effect, that the deficit would -- inflation would be worse, why do you support trump if all those things are true >> i think when inflation goes down dramatically. >> why with the tariffs >> this company runs on energy, number one it always has been -- it always has been an energy-based economy. >> right >> we have jobs and the factories and all that less a little bit, but we're relying on energy. to the extent that energy is involved in everything we do, everything we make, everything we consume, lowering energy prices, which i think he will do, he says he's going to do and he can do it by having a mandate to focus on the production of

energy and the expectation of energy and -- >> and maybe removing some -- we're at record levels already >> but we're going to need -- we're probably going to double the energy in the next ten years. pennsylvania, for example, is a gigantic store of natural gas and a lot of other things. >> how about the tariffs do you think that -- you hear both sides say either they don't really mean what they're going to do or just a negotiating -- you think that's a negotiating tool, you don't think there would be across the board tariffs? >> i think you had howard lutnick on the other day i don't know if your audience will remember what he said, but he made clear comments about what tariffs can and can't do. tariffs i think were a tool for sure to help get fair and balanced trade there is no such thing as free trade. but fair and balanced. and reduce restrictions. he was talking about, you know,

south korea, we made agriculture versus car deal. they would sell us cars, we would sell them products and then they reneged on the agricultural part because standards were different than our standards, which is true we're not the world standard for food, unfortunately. but we can get there if we want. >> do you think that tariffs would bring in enough money to replace taxes, the tax system at this point >> i'm not sure that i would look at it maybe that way. i would look at it more in terms of -- in terms of what we're trying to accomplish as a country even though -- >> a tool. >> a tool, right, to get, you know, necessarily jobs, factory jobs, other jobs back here, rather than exporting jobs just for cheap labor. >> right >> we constantly talk about character. you don't want to go to character? you've known him for how long? >> i have a question -- >> i met him in 1981. >> just a horrible, horrible character, unethical -- all the

companies -- >> he's exactly the person that he was in 1981 >> did he do those things? >> do what things? >> skip the contractors -- >> i think new york developers, it is a rough business you can look at various parts of what they do, but it is a dog eat dog business like any business. >> right and what about the women? what about some of the comments he made publicly on tapes? how do you feel about that >> i think that, you know, he -- all of my friends have weaknesses >> uh-huh. >> my good friends have more weaknesses maybe because you see them better. but you like them because they have those strengths and he's a unique person. there is nobody else i've ever seen, maybe elvis presley or somebody like that, he says i don't have a guitar, and i don't have anything -- >> you have seen him pay for people's education after a family -- >> you don't hear about that

you don't hear about those behind the scene things, he takes care of a family, or, you know, their firefighter husband, you know, is killed in a -- >> so, elon musk says there will be, quote, a temporary hardship in the economy if, in fact, and he's obviously supporting trump, he says there will be a temporary hardship, somebody went on twitter and said if trump succeeds in forcing through mass deportations, there will be an initial severe overreaction in the economy, they talk about the markets will tumble, and elon musk writes back, sounds about right he later goes on to say, there will be a rapid recovery to a healthier sustainable economy on the other side, like that's what he's hoping for, but the fact that he said, sounds about right, i think some people who are thinking about the economy say, okay, well, if he's willing to accept that there is going to be hardship, do the american people who are voting for this, are they willing to undergo

hardship for two or three years? maybe four it is hard to -- >> andrew, a lot of people say a lot of purposes you can go back four years and see what he did. he did initiate tariffs on china and other places >> right >> there wasn't a great dropoff. the economy was doing great and inflation was low and employment was high. >> you don't think he can try to do a lot more things a lot of what he's talking about, if there is a red sweep, you would think taxes become totally different, the tariff piece different, if elon musk gets in there, we all would like to see government spending to come down, no question but the public needs to understand that if we're going to slash and burn potentially millions of government jobs, which maybe we should do, the question is how you do it, do you do it with a scalpel or with a hammer i think you could -- >> i think the best thing to do is if you take a look at dj

trump's history, what he's done all along, i think that's the best indicator of how it is going to be. i don't think he's going to use an ax to do this he'll do it very judiciously he's got a different group of people this time i think he knows washington a lot better >> trump doesn't talk about what needs to be done enough. at least elon is being somewhat, you know, i think realistic. >> i think he's being very honest about it. >> if we're at 23% of spending and we usually are at 20%, so we raise 18 in taxes, it is only a 2 percentage point deficit, now n now we're at 18 and 23. >> the question is how do you do that over time so there isn't the hardship the immigration piece is an interesting one. i don't want illegal immigrants in this country, but the same time, depending how you handle it and if you do it super quick,

that could take out a lot of the economic -- >> i think kamala harris wants to get rid of them now too so where does she stand on that? i'm not sure where she stands. >> you are good at interpreting that >> i can't i need subtitles woody, thank you >> good to see you >> there's hope. >> aaron rodgers looked like aaron rodgers. >> at the end, yeah. >> i hope he's not watching. >> he might be >> nice to see you >> don't go anywhere we got to get to the commercial break first. in just a moment, we got stocks on the move this morning and then a group of former ceos writing an op-ed in "fortune," they're on the other side, they explain why they're voting for vice president harris, jeffrey sonnenfeld and doug parker are going to be with us in a little bit. don't go anywhere. "squawk box" returns after this. >> announcer: time now for

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>> announcer: now the answer to today's aflac trivia question. which company introduced toothpaste in a tube in 1889 the answer, johnson & johnson. i'm frank holland with your morning movers we're starting out with chevron, moving higher after top and bottom line beats and earnings shares are up just over 2% the company saw record production in the permian basin. they expect to close asset sales in a number of different regions, including alaska, canada and the congo the stock has been up and down this year. you see the chart here year to date, it is up, just about 2% we're going to stick with energy exxon higher after reporting mixed q3 earnings. those shares up 1.75%. the company saw better than expected production and raising its dividend by just about 4%. for more on this quarter, be sure to stay tuned for our exclusive interview with ceo darren woods later this hour and then rounding things out

with abbott laboratories, shares up 5% after a favorable ruling on a lawsuit that linked their baby formula to a potentially life threatening bowel disease the co-zdefendant, abbott labs u over 8% year to date, shares up 5% after that ruling becky, back to you. >> frank, thank you. we'll see you later. when we come back this morning, a group of former ceos writing an op-ed in fortune explaining why they are voting for vice president harris. and then we'll talk tech with dan niles of niles investment management coming up at 8:10 eastern time "squawk box" will be right back. . wow, fast response. sent! okay, oop! even bigger. sent. [sending swoosh, notification alert] still bigger. okay, yeah i'm not doing that— [typing noises, sending swoosh] i think it still looks good! [notification alert] oh — even bigger.

shares of estee lauder under pressure after a big drop yesterday. the company gave disappointing guidance the stock is downgraded and cutting the price targets. when we come back, corporate leaders and the election a number of former executives co-authoring a big op-ed in fortune explaining why they're

backg cerede hriinvi psintars in the election we're going to discuss this after the break with yale's jeff sonnenfeld and former american airlines ceo doug parker we're coming right back. 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. because when your people work better, everything works better. so, let's get to work. idris elba works here? mm-hmm. ya, he's super nice.

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former ceos co-authored an op-ed in fortune explaining why they say they're voting for vice president harris joining us now is the former chairman and ceo of american airlines, david parker and jeff sonnenfeld joins us. doug and jeff, thank you for joining us doug, make the case, we talked about a lot on the show, we had a number of ceos come on, but most of them have not actually run public companies, which i want to talk about or at least still are running public companies. why are you making this argument >> well, yeah, thanks, andrew. good to see you again. so, look, what happened is earlier this week jeff sent an article around to a number of us, he sends notes to, and one of the notes talked about how ceos right now are unable to talk it is a difficult environment. the country is polarized, it makes it very hard for anyone to make a statement because they could alienate their customers,

their employees. we all understand that also talked about how now there is fear of retaliation i said, it is just a crying shame because we all, as you do, talk to a lot of other ceos and what we know is those ceos are important in an election where the economy is the most important thing and what i know is the vast majority of those ceos, the ones that i'm in contact with regularly are not going to vote for donald trump and it is not so much because of economics, it is because of leadership and most of those ceos are, you know, not hedge fund managers, not billionaire entrepreneurs, the people you talk to on earnings days who work their way up through organizations with leadership skills, with servant leadership skills. and those are things like bringing people together and having integrity having, you know, global strategic thoughts and open minds. and they look to trump as the antithesis of those things and

it makes it difficult for them as leaders to support someone who does they can't support those things. i mentioned it to jeff it has been troubling me he said, what if i get a couple of people to talk with you or stand up with you and i said fair enough and three hours there were 20 people signing on to a letter. so i know this is true i can't speak for everyone else. but i can tell you what i know from the people i do talk to and it is a real issue it is a real concern it is a leadership concern much more so than a policy or economic policy concern for most of them. >> doug, let me ask you this, i'll go to jeff. if you look back 20 years ago, it appeared that ceos of publicly traded companies would donate to different candidates in their own name, in some cases they would speak up if they thought there was a candidate that was more -- that they liked more than another. do you think something has fundamentally shifted in this campaign is it about former president

trump specifically is it about a different culture that is more tribal? a combination of those things? do you see him as being responsible for that how do you see this? >> two things i say. definitely more polarizing so, there is no -- instead of -- making a statement like that in the past, well, okay, this is a business, this party seems more business-like, so it is something we can do. now it doesn't feel that way just feels polarizing and like you're picking sides no one wants to do that. you end up making people angry it is just a change in the republican party over time a party that once was more in line with politics of business, which are frankly fiscal conservatives, social progressivism, and some global free market thinking and as that has changed, makes it harder and harder for business people to speak up. >> jeff, how do you think about this i'll ask the question almost on

behalf of joe here, which is what do you think about some of the business leaders like elon musk or bill ackman or others who have supported president trump very publicly and may have put themselves to the degree you believe it is at risk in terms of social circles that they travel in or as you would say the cocktail parties the >> thanks, andrew. thanks for the invitation and great question i haven't seen anybody with diminished interest in buying teslas i think they might be critical of positions elon musk takes frankly some of musk's biggest critics are criticizing him on his platform, x, you know. so, they're still using the old twitter. i haven't seen those kind of -- that kind of retribution that we saw when president trump, as president, went after iconic companies. you name it, the companies which are great global brands like

harley-davidson, whose symbol is the american eagle, he went after them, just because they couldn't get product into europe because europe had retaliatory trade barriers, he had to shut down a plant in kansas city, open in thailand to get product in -- the competition was all non-u.s. he said boycott amazon, which the competition versus alibaba, not in the u.s. and went after delta, went after ford, gm, went after these great iconic companies. i haven't seen anything like that, but i will say -- >> do you think there is a silencing on both sides or no? >> no. but i'm so glad you raised the silencing issue. if you go back, as you wisely did, 20 years, 5 years, 10 years, we went back 100 years and guess what we found. almost since lincoln, because these union leagues in new york and philadelphia and new haven and all were business clubs to

support the nascent republican party is that for a century the republican party has been very much supporting the candidate -- the presidential candidate, the gop, from the business community and guess what has happened now? it is starting in 2016, where it used to be at least half or financially supporting and vocally supporting, it fell to zero, not a single fortune that as you know put it in this -- all this data in "the new york times" back in june and they republished it this week, it is not a single major ceo, you know, the fortune 100 we're supporting until elon musk came along won in 2016. used to be half. in 2020, just two and now it is zero other than musk that's the big break on the democrat side, we're hard pressed to find any. there are more now democrats speaking up from the ceo of box to lazard ferre to -- i think you can find several that are speaking out, but in the past,

you had the ceo of dupont, long time ago, in the '70s and the ceo of ibm tom watson jr., hardly any democrats speaking up, republicans always did and that's what's different. that's who went silent, no republican support for ceos and that's what the data is showing. >> doug, what kind of feedback have you gotten since this article has been published and, by the way, i would remind folks, you know, president trump actually helped you and your airline in the middle of covid with a big relief package at the time i'm curious if folks have come to you and said, you've gotten good reaction, bad reaction? and what do you think about the economic policies of the two candidates >> yeah, thanks. most of what i've gotten positive, maybe biased it has nothing do with american airlines i'm not associated with american

airlines this is everything to do with leadership in my mind and leadership of our country. and i saw a republican congressman talking and trying to explain this as well, just don't shoot the messenger. worry about the message, not the messenger. the messenger, of course, being donald trump and asking us to ignore the fact that the way the message is being delivered, and who the messenger is the messenger is the president of the united states and, you know, when we send the wrong message, through that messenger, you know, think about the other message we're sending. the message we send to the rest of the world, about who we are the message we send to each other about how we're supposed to treat each other and how should we behave, the message we send our kids about who they should be, and who we want to look up to those are real messages that i think are real concerns. and they're concerns for people that have gotten to be heads of

big companies by doing those things the right way and that's what i think, again, it is not our policies i'm no spokesperson for the harris/walz campaign i will happily tell you that, you know, the regulations that have been put in place by this administration on business i think are much worse for business than they were in the trump administration and those things are important but those things you can go fight. values are more important. leadership is more important and, you know, i think the right thing to do -- and, again, i know again, speaking for myself and what i know as i speak to others that this is what matters to people that lead. that understand that leadership does matter an the election is about leadership and that's why people, you know, are now in the jobs i used to have i know are -- >> doug, jeff, thank you for joining us this morning. thanks "squawk box" coming right back after this

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all right, welcome back, everybody. exxonmobil reporting in the last hour earnings came in at $1.92 a share, four cents better than the street was expecting the oil giant saying that it achieved its highest liquids production in over 40 years with 3.2 million barrels a day. cash flow from operating activities during the quarter $17.6 billion and joining us right now to talk about it is darren woods, chairman and ceo the stock right now up about 2%. i think what is maybe key in this is a lot of the earnings growth, the earnings power came from what you've been doing internally at the company to try and streamline operations and improve operations >> yeah, thank you, becky. good to see you again. you're right, the transformation of the organization has been on over the last eight years is really beginning to manifest itself it has been for the last several quarters and as the gcommodity cycle goes up and down, we'll

see the benefits from the work we have been doing if you look across each of our businesses in the quarter, this quarter, third quarter, is one of the best third quarters we have had in the past decade. and the upstream we see record volumes coming from our advantage assets like diana in the permian. we mentioned we have had the record oil production or at least oil production the highest we've seen in the last 40 years. if you look at the earnings per barrel that we're getting out of the upstream business, it's doubled since 2019 on a flat price basis. so take the market out of t we've doubled the earnings power of every barrel produced in the upstream similarly n energy products, if you look at the profitability that have business, we've doubled that versus 2019 on a constant price basis our specialty business, the year to date results are a record chemical business, we're up a billion dollars versus last year we've cut out over $11 billion in structural costs out of the business then in the new businesses we're

forming, the low carbon solution business, we've got the only world scale carbon capture and storage business on the contract and we have five contracts to store c02 close to 7 million tons per annum we are progressing the largest low carbon hydrogen facility and a first mover advantage in the lithium business where we're trying to implement a new technology and establish a new value chain for lithium. a lot of hard work over the last many years beginning to manifest itself in some real wins with respect to the business performance. >> if you're looking at the broader economy and the broader energy picture, we have seen a little bit of an oil glut, i think. oil prices down 10% over the last three months. what are you seeing in the world both in terms of oil supply and oil demand >> so i think if you look across all the products that we're producing, but oil in

particular, we're seeing record levels of demand for oil, record levels for demand for products coming out of refinery, petroleum products but we also see a lot of supply in the world right now and a lot of that supply is coming out of the u.s. in the unconventional developments that we have here in the u.s so it's basically a supply-driven price environment right now, demand looks pretty healthy as you look across the businesses similar with our chemical business, we're seeing very strong demand in chemicals, but at the same time a lot of supply, a lot of capacity has come on to meet that demand. so frankly like these capital intensive commodity businesses, it's the supply/demand balance that ultimately will determine price. demand looks good right now, supply is in excess and so prices are low, but as the world continues to grow, we will grow out of that supply and we will see prices rise when that happens. and we have to remember in the upstream, in the oil business, it's a depleting resource so

every barrel you produce is one less barrel in the world tomorrow so that depletion curve eventually catches up to the demand side of the equation as well. >> darren, there's been a lot of talk, we have an election next week and ahead the markets have been trading energy stocks down to some extent just on the idea that if thumprump wins you will looking at a drill, baby, drill environment and that means lots of supply and that could bring energy prices down what do you make of that you've got a lot of cash, more than $26 billion cash on hand. would you use that to increase production if you could or are you meeting the production you need right now we're just trying to figure out what happens because oil companies, the oil majors have been pretty disciplined to this point, but you're right, we've seen a lot more production in the permian and beyond. >> i think, becky, that blankly our industry as a whole and certainly our company has been very focused on making sure that

every dollar that we spend a productive and we're getting a good return for that dollar invested that's frankly what's driving the investment levels that we're pursuing and i also think, frankly, that's what's driving the investment levels of the industry as a whole. so it's less about overcoming restrictions, external restrictions in the system, and it's more about making sure that the technologies you're deploying, the approaches in your investment and activity level is being done in an effective and efficient manner so you generate returns for your shareholders i think that tends to set the level and certainly we wouldn't see a change based on a political change but more on an economic environment. >> so, darren, help us with this, though, because you just said the external restrictions you think -- i don't want to put words in your mouth -- would not affect things. the reason i'm sort of keying in on that we just had woody johnson here and one of the arguments he was making in favor of former president trump's economy, if you will, is that if

there are tariffs, the thing that's going to balance off or try to make up for it on the other end is a lot more oil at much lower prices to try to offset whatever you believe the inflationary effects would be. so can you comment on that >> well, when i said restrictions, andrew, i was just saying today i don't think the level of production in the u.s. is being constrained by external restrictions i think it's being driven by what i would call as the internal discipline of the industry and our company to make sure the money we're spending generates returns. as we move forward whatever policies get put in place from either administration, depending on how the election turns out, if that has an economic consequence that then leads to price signals in the market and structural shifts i think you will see the industry respond to that based on what those signals dictate. it's not a function of -- i don't think there's anybody out there that's developing a

business strategy to respond to a political agenda, quite frankly. i think that would be a very difficult task. >> i appreciate that the reason i'm asking is it sounds to me like if you're saying this is really a story of economics, it's not about the politics of it, that ultimately it may be very hard to actually get oil prices to be meaningfully lower to offset those tariff -- the inflationary effects of tariffs i'm trying to understand if i'm misunderstanding that. >> yeah, i don't -- as we're looking at the business, andrew, we are not setting our capital plans based on an assumption whether there's tariffs or not tariffs and the role we would have to lower prices i said at the end of the day, again, and i think this is for everyone in industry we're making the decisions based on returns we think we can return for our shareholders i don't think that's, frankly, going to change. the advantage of the unconventional business today, the business that's in the u.s.

predominantly in the u.s. and growing, is the flexibility that the industry has to ramp spending down and ramp down activity to lower production if the market environment would suggest that is needed, and likewise if the market environment gets tight and supply is tight and prices rise i think there is a flexibility in industry to increase spending to generate returns. and that's ultimately what's going to drive it. trying to calculate the derivative of a tariff on to oil prices i just frankly -- we have a hard time just calculating what oil prices are going to do based on the fundamentals. that third and fourth order math i don't think we are very good at. >> if you just simplistically look at t darren, though, there is a perception that there weren't a lot of new leases being allowed from the biden administration or offshore drilling was not happening or anwar or -- i can give you ten bullet points that people that were critical of the biden administration about how it was not conducive, not friendly to

the oil and gas industry, they were a fratd to make long-term capital commitments because biden made the comment about putting fossil fuels out of business in a perverse way that caused prices to go up to a point where it became very lucrative to continue to produce oil up at, you know, $70 or $75 is it possible it could be easier or there could be more leases, there would be more drilling activity, drill, baby, drill, is it possible that would happen and that if prices went down on -- per barrel to $50, would that hurt the oil industry and are we the swing producer now so that we could control global prices down -- more than opec could we get it down to $50 or would it stay high depending on what the rest of the world does? >> so i think every -- you know, the beauty of the u.s. market is it's highly competitive, our

industry is highly competitive each of us will be making decisions based on the market incentives it will be a function of what your break-even cost is and the returns you're generating is what will drive the investment level and amount of production that's coming out of the u.s so the unconventional resource coming out of the u.s. is, in fact, the swing producer from the standpoint of it's very flexible and can come up and down, the difference is it's not essentially a controlled group, it's a number of businesses that are aggressively competing against one another trying to bring their costs down and make it economic to invest in the next dollar. >> drill, baby, drill could hurt the industry, couldn't it? drill, baby, drill could hurt the industry. >> i'm not sure how drill, baby, drill translates into policy in the unconventional space we haven't been constrained by access to acreage. the challenge that the administration has been working through is permitting on developments, but that's a piece that i think has not constrained

the industry in the unconventional space there are resources around the country and in the gulf of mexico that haven't been opened up and access isn't as available as it could be that could for the longer term open up potential sources of supply but in the short and medium term it's an unconventional story and frankly that resource base today is available to the industry and it's just a function of the economic development so i don't see -- and then ultimately it will be as that industry continues to grow or as production continues to grow it will be permitting for pipelines and take away capacity that could get in the way, but today i think the industry is in a pretty good position. >> darren, california sued exxonmobil back in september, they allege deception about plastics recycling we had the california attorney general here on set with us and he said they knew and they lied when talking about recycling not being effective when it comes to plastics where does that lawsuit stand and what do you think about it

>> well, i think the attorney general's agenda was made pretty clear to anybody that was watching your show when he was on i mean, frankly, he didn't know what he was talking about. he came in with, i think, a very hollow set of talking points, repeated them pretty consistently, but i think obvious to everybody watching that he was more interested in sound bites than sound science and a lot more interested in attacking our company than attacking the problem of plastic waste. i think if the attorney general wants to do something for californians and to improve the environment, he should work with companies like exxonmobil who have real solutions that are necessary to solve what is a very challenging problem and focus less on firing up his anti oil and gas base to advance the political agenda we're obviously going to fight

that, but i think as we look forward to going forward and demonstrating that what our company has been doing in this space is actually trying to address what's a serious problem around the world, while we continue to maintain the really important benefits that plastics play in meeting the needs of people all around the world. >> so you saw that interview, darren, because at the end he was like mad that some of it was going into jet fuel. he goes, well, it's going into jet fuel i go, well, you came here from california, right? he goes, yeah. i said, did you fly? he goes, well, yeah, i have to travel it's like -- it was -- it's just glaringly funny. jet fuel seems like a good use for some of it, right? we do need jet fuel globally. >> so i think the points that's missed and one of the stepout advantages with the advanced recycling technology is the challenge with recycling today is it's mechanical, taking existing products, chopping it

up and trying to blend that back together again that has a couple problems the modern plastics you can't do that with all those plastics and then you have a degraded performance based on mechanical properties of what comes out of that mixing and blending process. what we're doing with the plastics, we take a broader set of plastics, we're actually taking it back to the beginning of the process and like we do with crude that comes into a refinery, breaking that plastic down back to its molecular components and those molecular components flow through our process and come out in the products based on the weight of the molecules. so you're basically reconstituting that plastics to its fundamental form and bringing it back into the product value plain. some of it could end up in petroleum products and fuel, some of it will end up in the plastics the real point here is that you are recycling that in its entirety and bringing it back into the system and by definition backing out virgin

feed or additional crude so it is true recycling and the big advantage there is you can do it with a lot of different plastics and you get the same qualities and advantages of virgin plastic it's a stepout technology, one that's going to be needed going forward, and something actually the attorney general should be supporting rather than fighting us against. >> i would say, look, the underlying is there is a major problem that only about 5% of our plastics are recycled, i think in the case of the exxon plant you are talking about it's more like 8% so it's improvement over what we see on an average, but the underlying problem is we do need to recycle more of this stuff and that is something, i think, that you are open to working on how would you come at them what should they be doing? what would you offer >> yeah, absolutely. i would tell you we are today investing in upstream facilities to try to collect plastic waste in order to get it to our facility to feed you're right, becky, the

challenge with plastic waste, it's not plastic in and of itself it's the disposal of waste plastic. there are techniques available today that we can start collecting that more effectively. it's going to take government involvement, there is a responsibility here for governments and communities to collect that waste so that it can be recycled. that is a big challenge. we are actually part of an alliance on plastic waste that we're working around the world to try to start to address this and, as i said, we're investing in businesses that will actually collect and process plastic waste so that we can feed it into the recycling process i think that's -- that's -- we definitely believe that that's something that needs to be done and something that we want to work on. >> all right darren, i want to thank you very much for being with us we appreciate it darren woods. >> thank you, becky. nice seeing you again. >> you, too. when we return, the latest on the union strike at boeing and a possible deal. "squawk box" will be right back. and get the support you need from your first day to graduation day and beyond.

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carl carl quintanilla. david faber. jim cramer welcome back to "squawk box. striking boeing workers out west you're going to get a chance to vote on another contract offer that's going to happen on monday i want to get straight over to phil lebeau,he's got the details about what may or may not happen monday morning. >> and we will find out on andrew, andrew may 50, that's what we are in today of the machinist strike at boeing, predominantly around the puget sound area around seattle.

the rank and file still need to vote on this, 38% raise over four years, previously 35% and enhanced 401(k) contribution from the company and a $12,000 signing bonus. previously the ratification bonus was $7,000 they've goosed it by 5 grand is that enough to get it over the finish line? we will find out on monday the two previous votes it was very clear the rank and file were nowhere close to being ready to accept the contract that was on the table. the initial one in september, 95% of the members voted no. that was as much of a comment about the leadership of the machinist union as it was to the contract offer it improved in terms of the number of yes votes, but still 64% said no on october 22nd and, again, we will find out on monday what about 33,000 members vote what's at stake for boeing is getting back to work. after 50 days, they have been impacted with a loss in the third quarter of $6.12 billion,

the estimate is that they lose at least a billion dollars for every month this strike is going on $1.3 billion in free cash flow we've talked about this time and again, guys, the balance sheet has been impacted dramatically for boeing they did complete a capital raise as you take a look at shares of boeing since the strike began, they completed a capital raise late -- well, early this week, actually, of $24.3 billion. so they've got some breathing room here, but the bottom line is they need to wrap this strike up and get it finished and get back to work >> phil, it was 90/10 or something last time? >> waste it 63 >> 64% said no yeah, overwhelmingly no. >> but 64% down from 99%. >> yeah. >> who had rejected it. >> 90 from 95%. >> how do you handicap it? this will go, phil >> i think there's a good shot that signing bonus of 12 grand,

i think you have a lot of younger rank and file members at the machinists, they might sit there and say, okay, i'm ready >> okay. thanks, phil coming up, the october jobs report is at 8:30 eastern. next, though, with most of the magnificent 7 now having reports their results we will get top take aways from tech inn nester dan niles. stay tuned, you're watching "squawk box. no sweat... for you anyway. create a beautiful website in minutes with godaddy. ♪♪ rising costs. selective coverage. for countless americans, the complex specialty care they need has always felt... just out of reach. ♪♪ at evernorth, we give members unrivaled access to the most complex therapies at the best prices. while providing enhanced support like in—home nursing

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this was it for tech earnings, big week in the latest we saw apple beat revenue and profit projections, iphone revenue grew 6%, amazon topped estimates driven by cloud advertising and growth all of the magnificent seven companies that have reported beat on the top and bottom lines except for tesla, which missed revenue expectations joining us now with what he likes in big tech, dan niles niles investment management founder and portfolio manager and i always like having you on, dan. i'm trying to remember last time, i think there were certain

members of the magnificent seven that you said i don't really think i'd want to get ahead of the kwults this time do you remember which ones those were that you had some concerns about and was it borne out >> yeah, i mean, we previewed -- we wrote a piece on monday about what we thought would happen this week and it pretty much turned out the way we expected, where google came out first, did very well, set a very high bar for the rest of the companies to report then meta came out, had solid results, but they always guide conservatively in the september quarter for the out year and the stock sold off, which is what we expected it to do. and microsoft, the guidance was a problem like we expected the forward numbers went down for the second quarter in a row, azure in particular which is their cloud business, the guidance was poor there. so that stock got really hit pretty hard. then you get to yesterday where apple went ahead and in the most

anticipated cut, they guided the december quarter revenues to low to mid single-digit growth, people are looking for 7%. so that obviously went down, again. and then amazon was the real surprise to me where e-commerce guidance was actually pretty strong, even though you have one less weekend this year between thanksgiving and christmas for people to go shopping. that didn't seem to matter business is really good for them our two favorites coming out of this, you know, it's the same two favorites that we had going in, which is meta and amazon through the rest of this year. >> i don't think you mentioned tesla there. when i see 100% pure profit from selling to other auto makers for those environmental credits, is that -- is that a repeatable business is it a business is there a reason to celebrate better than expected earnings because of things like that? >> yeah, i mean, tesla for me --

i'm a growth at a reasonable price investor and it's very hard with over 100 pe for me to make a good risk/reward case on the name because people aren't really focused on that so much, they are looking at the optionality of what's in the future and that's energy and storage, where it's about, you know, less than 10% of revenues, but growing over 50% a year. you've got robo taxis, you've got full self-driving over the next couple of years and that's what people are really owning the stock for, you joe it's not as much on the ev side. obviously that's the base business that gives them the money to fund all the rest of this, but, yeah, i have the same concerns you do because you do have the tax credits, obviously we have an election coming up in a few days and depending on who ends up in charge, ev tax credits, et cetera, are going to change, but having said that, maybe tesla is treated more fairly relative to the other car companies that have unions so, you know, we will have to

see what happens, obviously the election is going to matter for all of these big tech companies going forward and the outcome of that, at least in the short term, and then we will get back to business as normal, which is we will go back to focusing on fundamentals for all of these names and for the market as well >> i don't think any of the -- none of the big seven don't have a big stake in ai, i guess, and they are all spending money. who is at most risk of not getting a big payoff for the money they're spending and who could -- who is doing it well and could have a huge payoff from what they're spend sng. >> well, the one that should worry you is microsoft and the reason i say that is we've all heard of openai and chatgpt which really kicked all this off at the end of calendar '22 and obviously microsoft is a huge stake in openai. if you look at the numbers, though, for microsoft, their june quarter azure, which is their cloud business, was

growing 35%. then that went to 34% in the september quarter and they guided to 31 or 32, so the numbers are going down if you look at amazon, their cloud business has actually accelerated over the last five quarters from 12% to 19% growth, they are the biggest then if you look at google which is the smallest of them their growth accelerated from 29% last quarter to 35% in the quarter they just reported so you've got to ask yourself is microsoft actually getting a return for all of this money that they're investing when if you look at the numbers they've actually gone down over the last six months that's the one that should concern you and especially when you marry that with the evaluation when you are talk being a 33 pe and the market is trading at 24 times, that's the one that should give you the most concern, i think. the second one is obviously apple which you go the company has grown revenues cumulatively if you include this year, calendar year, at 5% over the last three years and every

product, you know, people go, oh, my god, vision pro is going to be terrific and then you figure out, no, nobody is going to wear ski goggles on their head then you look at what's going on with the iphone and the features that they've rolled out which surprised me, they weren't particularly good to start with, they will get upgraded in december in the u.s. but then you have to wait for next year for it to get upgraded in the rest of the world. you've got a company that's also trading at a 33 pe for 5% revenue growth over the past three years combined so that's the other one where if people finally go, do you know what, the problem isn't this, it's market share losses, to people like huawei that have resurged in china then that multiple could come down even though you continue to do low single digit and mid single growth which is what they guided for for the december quarter. >> okay. i would ask you about macro, if

there ever was an economic slowdown, maybe there won't be one, but i'm wondering which companies are dependent on a strong economy are they dependent at all? any of them on a strong economy? >> absolutely. the darling of this is obviously nvidia and we think for the next three to six months they will be fine you think back to covid, what did you see? well, when covid hit we all had to get back online so nvidia's revenue surged up 84% year over year at the beginning of 2021, then when we all went out and did things and the hyper scaler demand slowed down, nvidia's revenues went from up 84% to down over 20 as they had to absorb all of that spend >> right. >> it's the same thing with ai infrastructure where i think, you know, as you get to mid next year they will have to absorb that spend and revenues are going to have to slow down. >> great we will get an idea of what the jobs number is, that's why we're getting out quickly and they're playing music. thank you. >> thank you, joe. >> that's right. we're getting ready for it this is the big job report for

october. economists are expecting a gain of 100,000 jobs. we will see what happens we have had hotter numbers this week, just about every economic number we've hit after that we're going to lkbo t rorta autheept and what it could mean for potential interest rate cuts with former cleveland fed president lore receipt can a mester "squawk box" will be right back.

comingp, u the number of the morning, october jobs, the data, it is all next when "squawk box" returns in just a moment

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welcome back to "squawk box. we are just a few minutes away from the government's october employment report. ahead of that number we want to bring in our jobs panel this morning, again, we're just about a minute and a half away sara malek is here, chief investment officer and head of equities and fixed number at nuvi wendy he will.berg is here, the director of the hamilton project

and senior fellow in economic studies at brookings institution. joe avonnia is here, the chief economist at smbc securities and steve liesman and rick santelli standing by as well. we have just about a minute to go before this i want to look at where the future stand, dow up by about 125 points ahead of this, s&p futures up by 19, nasdaq up by 78 the yields on the treasuries are higher this morning, too, in fact, i think the ten year is 4.3% at 4.31, steve, the estimate is for 100,000 jobs but we have seen higher numbers coming in earlier in the week. >> we've seen some strength out there. big question about the impact about 24,000, 25,000 jobs how they were affected in florida and in north carolina. obviously other places as well you have the strikes, there are three different strikes out there. the street has given, i don't

know, 100,000 plus or minus on this in terms of the impact of the hurricanes and the strike. so we will just kind of do some math and figure out what the underlying strength of the economy is in the job market. >> all right just to prove that he's here, joe is on set with us. >> in the house. >> take a picture of him we're all ready to go. >> i thought that was trump. very trumpy. you've got the tie, the whole thing. >> rick santelli has that number he will in about a second. hey, rick. >> yes the big jobs, jobs, jobs report and the prophecy came true, jobs light, 12,000, 12,000 in nonfarm payroll, that is the lightest going back to december of 2020 and partially explained, of course, by storms, hurricanes, and strikes, but there's more nuance to come if you look at what the unemployment rate is, that remained at 4.1. so people are going to scratch their heads, hey, lousy jobs

report, why 4.1? because the rate comes from the household survey and the household survey counts those that are off work, absent due to strikes and storms so they're counted as employed it remains at 4.1% now, let's look at the average hourly earnings month over month, they remain sticky up 0.4. i would think that's a good thing, we were expecting a 0.3 number and in the rearview mirror the 0.4 was revised to 0.3. now, if we look at year over year perspective it also remained at 4% -- excuse me, 4% was the original release last month, that was downgraded just like the month over month to 3.9. so it's hotter technically but as expected and prior to provision it was equal to last month. now, if you look at the workweek, 34.3, it built a little bit more in it went from 34.2 to 34.3 and

last month a revision, late revision so it moves up from .2 to .3, it equals that. why is that so important sometimes less hours worked has a tendency to kind of artificially boost wages and finally let's look at the labor force participation rate 62.7 expected, 62.7 in the rearview mirror but it comes in participation light, 62.6, which equals where we were in june to find a lighter number you have to go to the month before that to may and finally the underemployment rate, 4.1 is called u 3, that's the normal employment rate we use in all data, the underemployment rate known as u-6 comes in at 7.7, where it was last month to find a higher number you would have to go to august when it was 7.9 so we have made some progress there. the markets, very volatile we've seen a trade close to 432, a trade around 4.23 those are in

ten-year yields it's currently trading at 4.25 and change do keep in mind that it closed last week at 4.24. so it's still up in yield on the week and at 4.11 we see that the two year note has given back a bit of ground it was at 4.20 prior to the number. an outsized effect was expected with the weak number, which everybody predicted, but with all the nuance here for all the variables that potentially made this jobs light, the market is paying very close attention, trying to get it right in the big picture. becky and the panel, back to you. >> okay. rick, stay right there that's really interesting because you saw the anticipated moves that you might think with equities higher, yields coming down a little bit, just on the idea that the fed is going to look at this and say, okay, maybe there's potential for cutting again, but you made the right point, rick, and that point is the household survey shows a different picture, that's the one that is maybe the

noise you need to look through from the jobs report versus the unemployment rate. steve, what do you think reading through all this >> well, that's a very good take, becky, and the reason is because the household survey doesn't really care if you are not working because of a hurricane or a strike -- well, actually a strike, but a hurricane or a strike, actually, but the payroll survey does. so i think this might be sort of a goldilocks-type report and it has to do with how much math that you want to do and add back in do you add back in 100,000 from the strikes and from the hurricane effect the blf, i was reading the note that they put out saying the response rates were down in part because it was a short period for responses, but if you add back 100 and say, okay, we had 112, that's a pretty good number and that might put the fed back on track in terms of believing

that the job market is weakening or at least giving up some of the big gains of the prior month. one other thing that was out there, the reason why the unemployment rate might remain unchanged, is because we had obviously this influx of immigrants and then the border was kind of closed down and so we don't have that influx anymore. what might be happening is that initial influx that's been out there, those folks might have gotten jobs keeping the unemployment rate down so -- and of course having no impact at all from the hurricanes in that number. i'm looking for the number, and i will get you that in a second, of the number who are out of work due to bad weather. >> okay. keep digging through that. joe, you are here on set you're looking at two phones, what's the information >> looking at math and the data. >> okay. >> i'm going to respectfully disagree with the great santelli and mr. liesman as well. if you look at the household data you actually lost almost 400,000 jobs, employment fell almost 400,000 jobs. if you look at private sage and salary workers within the

household survey which is the core number that was down 102,000. the reason the unemployment rate was stable was because civilian labor force shrunk over a couple hundred thousand this may not look like the great number or ex-hurricane it's being portrayed. >> and your thought is this is telling us what about the economy? >> the economy was -- we are in a lot of crossroads in the economy, the gdp data had been great, but the gdp data had been good becky, we are up almost 1.4 trillion nominal dollars in gdp. sounds great the problem is marketable treasury debt is up $2 trillion. so in the last 12 months we have issued $600 billion in debt to fund gdp growth that was $600 billion less that's -- that's really the crux and i think why people have missed why gdp has been strong, the government is just throwing so much money into the economy it can't slow. >> the chips act and beyond or the ira? >> it's the ira, the american rescue plan, the infrastructure

bill, some of it's been used it's a lot -- it's just a lot of money that's there, not all of which has been used yet and it's underpinning demand. >> what, did you say did you drop the feed or did you have something on what joe was saying wing we may have lost steve for a moment >> yeah, i'm back. i'm back. >> okay. hold on. let me get to wendy's take first, steve do you agree with what joe was just saying here and we hear everything you're saying, steve. >> i think we have a remarkably strong economy right now it's true that these numbers are -- the employment numbers are difficult to parse given the strike and hurricane effects if you look at the three-month average and you add back in the noise from the strikes and the hurricanes, we're maybe at about 140,000 a month on average over the last three months. that's a good number, not a great number and i do think we still need to be comparing that to labor force growth that is still being boosted by immigration, even

though the border has been a lot more orderly, we are still seeing numbers this year for requests for work permits and even approved work permits that are higher than they were in 2023 so as much as the flows at the border have become a lot more reasonable and orderly, we are still seeing higher labor force growth perhaps because of lags in immigration earlier in year but all said, the fact that we have inflation quite near target and this strong of a labor market is great news in all but four states the unemployment rate and the latest numbers is below 5% there's a lot for policymakers to be crowing about. >> steve, i know you have a point and i will get you in just a second sara, take a look at what we're seeing not only with the equities but treasury market

before we started this the ten year was at 4.31 so we have seen significant moves here what do you take away at this from an equities analyst, what people should be thinking with the stock market's reaction? >> investors expected this number to be more noise than signal because of the impact of the strikes and storms, but the sweet spot for investors would have been a payrolls number of about 100,000. what is this 12,000 telling us about the economy and markets? first of all, i think it says that the september quarter million payrolls was likely an anomaly and we are back to the downward trend that concerned the fed precept and caused the fed to cut by 50 basis points in november first of all, i think it puts 25 for sure back on the table for the november fed, probably another 25 for december. fed may consider 50 for november if the next payroll number for november comes in late again but i think markets are somewhat going to write this off and move on pretty quickly because coming up we have geopolitics with escalation in the middle east potentially happening again, also earnings which have been mixed. we expected great earnings from

tech stocks but they have not delivered on an aggregate basis and of course the election next week, we don't even know when we will have an answer to who is our next president all of that i think is going to take front stage with this number and this number will be written off because of the strikes and storms. >> fair point. in the meantime, steve, how will the fed read this and what did you want to jump in on did you see some other numbers >> yeah, i finally got that number people not at work due to bad weather was 512,000. >> wow. >> so it's a big number. it's not the biggest number, by the way, the blizzard of january '96, 1.8 million were not at work due to bad weather. people not at work due to labor disputes it's just 22,000. i wonder if they're picking up all of it right there. i'm reading the market, becky, which seems to put the fed back on track to rate cuts. they are more sure now the quarter point next week, more sure of a quarter point in december and now they're dialing back in -- this has been the

swing factor that i've been watching is january. the market had a pause built in for january, now there's a 60% probability or 61% probability of a quarter point cut and then the big change, guys, can you put up the october 25 fed funds future contract? that's a year from now they have restored a bunch of rate cuts. they were playing with this terminal rate that was like 3.73, it will be fascinating to see what joe thinks about this, but they are now down to 3.57 so they added back another quarter point rate cut here. the fed they are looking at this thing saying, okay, even when i add back all the jobs i get that cooling that i was looking for in the labor market. >> do you think, joe, that this is a situation where the market really is -- or the economy really is cooling and cooling pretty rapidly >> you can't have it both ways, you can't say the labor market is great and the fed should be cutting because inflation is low.

we are not back at target. >> inflation. >> we're massively above where we would be if we had been growing at 2% for the last three and a half years the likelihood we're going to get inflation back to 2 if the labor market is robust i think is low. >> but do you think it's a robust labor market or not >> no, i don't think it's a robust labor market and i argued for 50 basis points back in september because the data we had at that time and i think the fed did the right move i would not be cutting rates next week. the fed probably will, but the market has been conditioned by powell and fed rhetoric that it doesn't want to back away from it to me that's a problem i would wait inflation is not where it needs to be, the gdp numbers even if it's due to government large s is still growing at 3% the likelihood you will get back to 2% inflation is -- we're not there yet. >> you're talking about -- year over year? >> yes, three month rate of

change on core pc or cpi, which is why if you look at consumer sentiment it's still depressed >> wendy, weigh in on that do you think the economy is significantly weakening? what would you tell the fed based on the numbers you're watching >> so i'm confused about what joe is saying. the three-month core pce inflation in the third quarter was 2.16, 16 basis points above the fed's target so that is darn close -- >> three-month rate of change. it's not quarterly three-month rate of change, what's that? >> it's a little higher, i think it's like a quarter percent higher than the fed's starting. >> thank you, steve. 2.4. i rest my case. >> that is not -- that is not shockingly higher than target. and certainly -- >> but it came from 8%, it's down to 2.5. >> in any case, the question is -- >> this isn't hard, it's supply and demand. >> the question is is it

appropriate given how much inflation has been coming down and as quickly as it's been coming down and as close as it is to target, is it appropriate for monetary policy to be as tight as it was before and the answer to that just has to be no inflation -- >> the answer would probably be if you think the jobs market is significantly slowing, if you think the economy is significantly slowing it's worth jumping in, if not maybe you take your time and more cautiously. >> otherwise it's logically inconsistent we are 20% above -- cost of living is high. >> go ahead, wendy. >> there is no debate about that. >> wendy >> the labor market is i remember refute blee slowing and it is basically in the ballpark of what is a sustainable pace of employment growth, a stable -- sustainable unemployment rate that the labor market looks healthy, perhaps a little weak, but basically healthy and we've got inflation close to target. as far as the real economy is

going, what really boosted gdp growth in the last quarter was consumer spending. so despite the fact that consumers are saying that they're not particularly confident, they're sure spending like they're confident. >> joe >> it's weak or it's strong? which is it? i mean, i think the economy is weak and it's been -- >> joe, it's a soft landing, joe. joe, that's what a soft landing is. >> it could be it could be a soft landing, steve, you're right, i don't dispute that >> i know you don't. >> -- at the same time we're going to say inflation should be coming down -- >> steve, is this an argument for the fed to continue easing or an argument for the fed to wait and see what's happening and then move? >> here is the thing -- i really think both are right here and i think the market has this right, which is that the fed can take a little off the top, but stop earlier than it -- than the market previously thought or even than the fed forecast i believe wendy is correct that

you don't need the high restrictive rate that you had when inflation was 9%. at the same time i believe joe is correct that you want to proceed very cautiously because the gdp numbers have been high and also, by the way, because we are not so sure what the heck is going on in the job market because we had a hurricane and a bunch of strikes so you want to be careful here, but i do believe there's scope for the fed to cut and to -- then be cautious. >> share ration i want to give you the last quick word. this is all the high thought period of the whole thing in reality how this plays out in the markets, what they want to hear. >> investors are going to focus on what's around the corner. yes, we see unemployment rates today but we will be focusing on the next presidential term, and two factors, taxes and tariffs both of those tax cuts and potentially more tariffs are inflationary our concern is that as we roll into 2025 inflation could start to reaccelerate. a weakening employment market,

potential reacceleration in inflation that puts the fed in a tough spot we may get our 25 to 50 for the rest of this year but i think 2025 is more challenging for investors. >> i want to thank our jobs panel. we will see you later. coming up, former cleveland fed president loretta mester is going to join us on the -- what we just saw, the new jobs data and what the numbers could mean for the central bankers when they decide -- or when they meet next week to decide -- they are not deciding on whether to meet. they're meeting. they love it next week on interest rates. and a programming note, monday at 7:30 a.m. eastern time don't miss an exclusive interview with billionaire uln.mpacr hnkejo paso he joins us in the final stretch to election day. stay tuned, "squawk box" will be right back 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.

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♪ welcome back to "squawk box. futures following the jobs report as you can see. they like a, you know, what do

they like? they like the fed to cut rates, and it makes it more likely, up 180 on the dow jones, nasdaq up 90 take a look at treasurys, which we haven't seen a lot of 4.23% on the ten-year. we were at 4.30% for a little while, but you know, 12,000, at least on face value, sounds like it's weak, but we're still at 4.1%, so not that much changed >> let's dig into this, because now, to discuss the jobs report, the implications for the fed, the distinction between those adp numbers and today, cleveland fed president, former cleveland fed president, loaurie mester, now a cnbc contributor i'm so curious as you saw this number cross the tape, what was your first reaction >> well, we expected it to be affected by the hurricanes, and i think that's what we're seeing in that report we knew it was going to be a mixed read and there was going to be a lot of noise in it

i was glad to see that the unemployment rate stayed at 4.1%, so that gives you some indication that things are not, you know, as weak as that payroll number suggests it was, and that it was affected by some of those hurricanes. i think steve, before, talked about the number of people who were out of work because the weather was quite high i think that's a noisy reading, and i think what the fed will do is they'll take that into account when they look at all the other indicators that came in since the september meeting >> so, when you think about what the fed is going to do next week, they will do what? >> yeah, to my mind, it's not that hard. i mean, it seems pretty straightforward to cut another 25 basis points. if you look at all the data that came in since the last meeting, it really hasn't changed the baseline narrative, which is, look, inflation has come down quite a bit from its peak. there's more confidence it's going to continue to move down, but we know it's going to move down gramdually if you look at the s&p from

september, it takes a couple years to get all the way back to 2%, but more confidence it is on that downward track, and the unemployment -- the employment part of the mandate, we know it's moderating, but still, the readings are healthy so, what you want to be doing is as the economy normalizes, you want to make sure that you're normalizing policy so it stays really well calibrated to that economy, and importantly, you want to make sure that you're always positioning policy so that no matter how the risk manifests themselves, you're able to respond, and i think that's kind of what the narrative was at the last meeting. they did 50 because they were concerned about, i think, the labor market, what they saw in some of those readings in the summer some of that was revised away, but there hasn't really been a big change in sort of what the baseline view of the economy is. now, that could change as we get more data going into the winter and early in january, and that's the -- going to be the task of the policymakers to just really

analyze. >> what do you make of the argument -- we heard this from people like marc rowan, who runs apollo group, he said there shouldn't be any rate cuts, the economy's doing fine or more than fine. >> that's a short run focus. i think what the fed has to be doing is looking at, how's the economy going to fare in six months from now, nine months, 12 months, because that's when the policy that the fed sets actually has its impact. so, i think my view would be that i look at all the data coming in, and it really hasn't changed where i think the economy is headed. and so, that means that we should be continuing to normalize a bit, but we may, you know, want to be careful about that, because there are, you know, risks on both sides, and so i think the downside risks are less than they were in september, but my basic view of the economy hasn't changed that much that i would say, pause also, i mean, you remember rose ann rosannadanna, like, never

mind they changed what their view was the last time. they came out and said, we are more confident inflation is going to get back to 2% in a sustainable way. we see the employment moderating we want to recalibrate policy to be for that economy. it would be kind of dis -- hard to get into my mind, at least, like, you said that in september, now your whole view of the world has changed based on the data that's come in sometimes the world can change quickly, but not based on what we've seen >> loretta, we appreciate it you're looking at the stock market it is moving higher on the back of this expectation that a cut, maybe more, still in the offing. >> that is my favorite analogy of the morning roseann rosannadanna >> the number of years is what's frightening. >> since she's -- >> gilda was -- she passed away. gene wilder passed

you have to be a certain age to even know what the hell loretta's talking about. >> we just dated ourselves >> like our age. >> when we come back, some top stocks to watch as we make our way to the opening bell on the month on wall street dow futures now up 220 points, a big advancement since we got that jobs number, weaker than anticipated jobs number just 12,000 jobs versus the 100,000 the street was expecting, but as loretta just said, a lot of noise in that. it does open the door, though, that the fed could cut rates again. we'll be right back. the same way, you have... the fearless investor. the type a cpa. the bootstrapper. the bootmaker. yeehaw [narrator] but many do have something in common. we all trust schwab with our wealth. [narrator] thanks to our award-winning service, low costs and transparent advice. every day, over a million multi-millionares trust schwab with more than two trillion dollars of their wealth.

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welcome back to "squawk box. checking your premarket murfremovers, shares of amazon up, even though aws revenue came in just below estimates. amazon's capex grew by more than 80% largely because of a.i. investments. apple, shares falling down almost 2% after better than expected profit and revenue in q4 however, net income fell by more than $8 billion year over year after a $10 billion one-time charge in europe also, current quarter revenue guidance just slightly below expectations last one, intel shares moving higher right now after posting an adjusted top and bottom line beat, minus a one-time charge. the chip maker getting better

than expected guidance those shares up just about 6.5%. becky, back to you >> frank, thank you very much. let's get one more check on the markets as we head toward the opening bell you can see the dow futures up by about 210 points. s&p futures up by 27 the nasdaq, up by 87 we've seen yields pick up as well that does it for us for the week make sure you join us right back here on monday right now, it's time for "squawk on the street. have a great weekend ♪ good friday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer at post nine of the new york stock exchange david faber has the morning off. stocks do try to claw back some of thursday's losses worst day for the nas since september. the jobs number is weird, 12,000, but plenty of noise. unemployment stays at 4.1% our road map begins with big tech and a.i., though. amazon pledging its investments will pay off, and tim cook saying apple intelligence is "a compelling upgrade reason. jo