crypto still kind of within shot of that $100,000 mark that it almost reached earlier this week. it's at $94,249. and that does it for us today. first of all, want to thank all of our viewers who join us every day. we are thankful for you and we hope you good wednesday morning. kramer has the morning. mild weakness in futures after disappointing tech earnings last night. a jampacked macro calendar today and some new economic staff announcements from the transition.

markets close tomorrow for thanksgiving and we get a half day friday. the roadmap begins with the fed's preferred inflation gauge. bracing for october pce. >> president-elect trump naming the pick for economic counsel and trade representative . >> on the tech earnings, ai shares of dell take a hit with weaker than excited guidance. >> a record run ahead of october pce. more important numbers as we wait for the december fed decision. we have numbers for the quarter. core pce and claims another six month low. came in late. it will be busy today. >> i was thinking david said he is not thankful for me. >> stayed with me. i didn't mean to start off that way. just kidding. >> gdp, not bad. 3rd quarter, not bad. second look.

and nice surprise on the core pce which comes out on a quarterly basis. we get the october read at 10:00 a.m. which is exciting. we never get the big numbers at 10:00 a.m. we get economic data. a good surprise on the 2.1% core pce for the quarter. especially if you are one of those that have been worried about inflation. as far as jobless claims, also good. not really seeing of stress or layoffs. 213 for the week, lowest since late april. continuing claims are little bit elevated. that reflects that it is harder when you are on the jobless claims to go back into the workforce and get a job. but you are not seeing the layoffs. i would at all so that good signs on the job front. consumer confidence came in yesterday better-than-expected. the quote from dana peterson, the economist at the conference board, did mention that the

improved confidence was because of the labor market. better conditions at the labor market. that might bode well for the fridays are job report. that is when we get the november payroll report and it might be as important if not more important determining with the fed does in the december meeting to today's pce number. remember we have pce today. we will get cpi and jobs all before the fed meeting which the market is wavering between if they will cut rates again. >> i have a feeling we will have this discussion many times in the weeks and months ahead. as we start to digest the possibility of tariffs on what that will mean. what are we being told by the futures in terms of the treasury side, in terms of potential cuts and when they come? >> we are sort of like 50%. most people are little bit more than that, chances for december. most economists and trading notes i read expect a 25 basis point cut in december and then

a pause in january. it is not a done deal and the messaging from some of the fed members have been a little mixed. one, we get the minutes from the last fed meeting yesterday. it is a little bit stale. at one point, people are paying attention to, has to do with the fact that they see this balance being pretty equal between inflation risk and employment risk. the employment risk of a softer jobs market, they did say, has decreased because we are getting good signs on the labor market. that might point them to what they are calling gradual, how the market interprets it, as a pause. december, january. don't know exactly what that will come to but the ultimate repricing is that we get fewer cuts than initially thought into next year and that is not even factoring in trump policies necessarily because the fed doesn't want to preempt any of the. >> people trying to plug in

yesterday's tariff threat into some models knowing that things could change. goldman did say knowing what we know and if you took that for what it is worth, would boost core pce by about nine tenths. and could cut s&p earnings by a few percentage points. we will see what that does to the forecast for next year. certainly, a lot of interest- rate options activitybetting on higher yields into january. those contracts in the last week of december would imply may be a revisit to four and three quarters, basically the highs of the year. >> you can see where we are now. we did see the impact and one name we talked about a lot yesterday was gm. i know analysts at morgan stanley followed that with some specific numbers. we shared a lot of them yesterday in terms of what the impact might be. not strong enough to absorb 25% price increases and just generally, wonders weather if you had to pass those along, the ability of exposed oems to

pass along would be challenging given the u.s. consumer already facing monthly auto payments near historic highs which goes back to historic rates. and so it is a question. we saw it reflected with a significant drop in gm shares yesterday. ford and gm, most exposed to what they are importing from mexico, or manufacturing in mexico. >> and also canada by the way. 16 million u.s. auto market. 17% imported from mexico. 6% imported from canada. let's note that there was an idea out of this that jonah said if this does go through, beneficiaries could be less exposed asian oems or automakers. toyota, hyundai and kia may be in a better position to gain market share, they say, because they are less exposed to that. >> interesting that you would be benefiting the japanese automakers. >> i'm sure that wasn't the intention. >> there are so many interconnections and when it comes to the supply chain and

so many other things to try to figure out what these things. and you have to issue exemptions. we should point out in the first trump term, a lot of what was said when it came to tariffs ultimately did not come to pass. some did. certainly the stuff on china to a certain extent but a lot did. >> a few things to point out. he gave time and was clear with what he wants. that was immigration and drugs. we don't know exactly what that means or what kind of concessions that will look like. the point, carl, is that he wasn't trying to the exact economic trade-offs. wasn't going after the chinese to buy more crops like last time. it was very clear that it was part of the domestic policy, national policy. and two key items he ran on. the tariffs seen as more of a threat i think or at least i think it was interesting the market rallied and finished higher on the day despite pricing and that potential of

an economic hit. >> this is mark cuban's question. how little can they offer to have trump say that the threat was worth it? it was interesting to hear some of the response rhetoric. basically saying, 70% of the guns that we confiscate in mexico come from your side. this is not a one-way trip. >> i don't think that will be helpful in this negotiation. clearly, the u.s. has a leverage . most experts in mexico come to the u.s. and it is a big chunk of their economy. as i mentioned, 27% of their economy is exported to the u.s. xo she could talk to us. and ultimately, u.s. importers will pay a price in u.s. consumers will pay a price. but the biggest loser will be mexico and the biggest loser will be canada if they let these tariffs go. >> freeland did say, when you guys did the aluminum and steel tariffs at trump 1. zero, we matched you dollar for dollar and that was a showdown where there was no winner either way. >> and the willingness to

immigrate illegally and mexico. >> we don't want that. >> obviously, there are a lot of consequences. it is notable that the market rallied on the scott bessent appointment to treasury thinking that it would be sort of a moderate. maybe he would tame the worst instincts on tariffs. and within 24 hours, the tariff threat came out. clearly, president-elect trump is in charge and when he said tariffs were the best word in the dictionary, human to. this this is sort of the least surprising thing and the market should be less surprised. >> we will find out more about the transition. president-elect announcing two new picks for the economic team. we have the latest on that. good morning. >> president-elect trump rounding out his economic team with a series of evening news releases last night including naming kevin hassett as the economic child chairman.

he was a genial and well-liked presence in trump's white house where he shared the in house think tank known as the council of economic advisers, the national economic council job as a council but it a step up from that and it comes with a west wing office which gives more sway over the economic agenda this time around. that is likely to be welcomed by wall street where he is seen as an advocate of the trump tariff agenda but one that has his roots in traditional conservative economics. the other big selection last night was jamieson greer, a lawyer that will serve as u.s. trade representative. he served as chief of staff last time around. and robert lighthizer has been seen as a staunch advocate of trump's tariff plan but may not have as much autonomy as last time because trump has signaled that he wants howard let nick to serve as commerce secretary and oversee the trade agenda. that may place jamieson greer is

lower and the trump hierarchy and all that raises the question of, what will, if any in the administration for him himself. what role will the ave quick some super economic czar. or out in the cold altogether? we will see. back over to you. >> that is interesting. there has been indication that he may be the trade czar so to speak. have you heard anything that it may go otherwise and perhaps not be part of the administration an official or unofficial capacity? >> we don't know. it is interesting that trump put out on social media that let nick would oversee and the trump administration. and placed over. the question is, what role is there for a trade czar if

he is the guy overseeing the trade agenda or is that social media post not operative anymore ? it is a little unclear and we will wait for guidance from mar-a-lago. >> i think president trump is the guy overseeing the trade agenda as was made clear in truth social. clearly, that is his tactic. when it comes to more than just economic policies. i mentioned national security and international geopolitics. it is front and center. should the market be sort of breathing a sigh of relief that it is kevin hassett and the chief of staff and not lighthizer and navarro? is that coming up at all? >> i think this is the march of the moderates. these are names that are well respected and well-liked on wall street getting top jobs. like the treasury secretary and the national economic council. this is trump signaling to wall street and to financial markets that he gets it and wants to appoint people who they are

comfortable with. at the same time, trump is not signaling that he won't do everything he said on the campaign trail as you just pointed out. his social media post this week about the tariff agenda signals that he will do what he said he was going to do. the specifics are to come. we will have to flush out the details. but he will use tariffs as a negotiating tool and a way to rebuild american manufacturing as he sees fit. and these guys are may be more wall street friendly will do as they are told inside the administration. >> we will see how it drives investment. a lot more to talk about later this morning. when they come back, from the experimental obesity drug data to the white house proposing weight loss drug coverage requirements for medicare and medicaid and a look at the road ahead for investing. taking a look at the premarket here. and i seven-day winning streak for the s&p. the fourth one in the last five months. back in a mitenu.

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welcome back to squawk on the street. we have had a lot of news in the glp-1 space so to speak involving names like eli lilly. the next guest is bullish despite stock bowling. this is in reaction to mid- stage trial results for the experimental obesity drug. we have the leading biotech analyst who has a rating on the stock. price target 3.75. nice to have you here. you said in order report yesterday that you continue to see a highly differentiated asset with this dragon remain confident in the outlook for it. why do you differ from what was not a decidedly positive reaction from the market? >> i think what happened yesterday was people really couldn't understand the differentiation versus eli lilly

and the drugs. they want more details as it relates to the tolerability profile of the drug. the reason we think it is differentiated is, one, you have efficacy that looks in- line with eli lilly about a 20% weight loss after one year. but it looks to be deepening over time. it looks like you could have more weight loss past 52 weeks. and in addition, it is the one this a month or less frequent injection and that differs from the once weekly injection. i think the key points of debate was around the tolerability profile. the nausea and vomiting. it seems, on vomiting for instance, it will go from 40%, to 20% of patients getting to where eli lilly is with patients on patient changes they will make on trial design for phase 3. it wasn't just an obesity story. it looks to be a diabetes story where they have differentiation on that side as well. potentially best in class. >> you are fairly confident at

least in tolerability, that they will show numbers that are roughly aligned with the existing therapies? >> it might be slightly higher but it is a first dosage effect and it doesn't seem to be as high when you take the second dosing and beyond. >> who is in the poll position when it comes to building capacity and delivering supplies ? does anyone have an advantage on that? >> eli lilly is a duopoly and they have the supply. and amgen has the ability to manage supply. just given the infrastructure. >> what is the history. i can think of cholesterol medicine. we started with lipitor and there were so many. what does the history show us in terms of a new entrance into a market that has existing therapies and where the differentiation and impact would not seem to be too great? >> diabetes was a case where, there was still a duopoly to a degree.

we have seen cardiovascular where you had multiple entrance. i think here, where we have the anti- obesity market, it is one where people will have a selection for what they want and not everybody needs to lose more than 20% of their weight. not everybody wants an injection . they might want an oral or a less frequent injection it may be a subpopulation of patients that have cardiovascular disease and opt for a drug that looks better in that population. i think it will be broken up in subpopulations based on patient preference. >> what about the proposal from the white house we got yesterday for medicare and medicaid to cover anti- obesity drugs like this for obesity and not just diabetes? you think there is any reason to expect that to follow through and happen under a trump administration? >> i think we will have to see what plays out under the new administration but clearly there are links from obesity to many other diseases including cardiovascular disease and a link to mortality. i

think that is probably the thought process here. >> and finally, when do we get to oral medications of this type and who do you think will be first? i assume that will conceivably be a market share positive for whomever it is. >> we are watching eli lilly and novartis to be first on that site and then we will see other entrances, and over time. >> generally speaking with amgen, you expect that stock to recover losses and respond positively? >> it came back to our based business evaluation of 285. at this point, it is about numbers, for 25. additional details will be provided as well as a catalyst as we look toward the next year . >> thank you for joining us. still to come, american express ceo on the consumer, small business, the state of holiday spending and more. that is coming up in the next hour of squawk on the street and money movers at 11:00 a.m.

eastern time. another look at futures as we go to the opening bell. dow futures of 19. s&p down six. nasdaq futures under pressure. we did have weak reaction to earnings like the dow, hp and crowd strike. we will hit that all for you when we come back. we earn your trust. maintain our financial strength and stability. and deliver solutions that meet complex needs. massmutual. partnering with financial professionals, benefits brokers, and institutions.

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take a look at some s&p this morning. not a good earning for tech earnings between dell, hp, autodesk, workday, crowd strike is well with a downgrade today. we will get 12 that. opening bell in about five minutes. n'forget you can catch us anytime, anywhere. listen to and follow the squawk on the street opening bell podcast.

shares of dell's lighting premarket. the company did miss on revenue estimates and posted a light forecast. servers very strong. networking strong. pc demand at the consumer end, down 18. kind of backed up by the hp pc myths and guidance lower at a time when we were hoping there would be the ai refresh. >> both incredibly bullish on the ai refresh and the pcs. everybody bought pcs during

covid and then it has been a giveback in the cycle. so waiting for companies to upgrade feels like it is time. and then the new ai pts, pcs, dell and hp, having been bullish on that front. and the ai servers, up from 3. 2 billion last quarter. and also potentially a push out in the ai server business due to blackwell coming from nvidia. the partner they are. and doing a lot of business to keep in mind, dell had seen a tremendous run up into this results. potentially why stock is getting hit so hard today. the forecast missed by a billion dollars in revenue. >> it is interesting that a consumer is conceivably putting pressure on the stock given it is a small percentage of the business. down 18% is not nothing. they were of 3% or so i think in terms of the corporate side of the pc business. but down 18% for consumer is

certainly concerning investors. and as sara mentioned, you think ai is the growth engine here. when it comes to servers, they put up a good number. and the inventory number as well has been quite strong. and 4.5 billion. >> reduced guidance out of best buy yesterday. let's get to cnbc realtime exchange and the opening bell. santa is in the house here at the big board. macy's and santa claus celebrating the 98th macy's thanksgiving day parade at the nasdaq. and pony ai celebrating its ipo. you guys are going to watch right, the parade tomorrow? >> as always. and i always watch the dog show which is a nice tradition at our house. i love the dog show. >> the westminster dog show. i always cheer for the little

toy category. not a big win yet. medication services and information technology are the two sectors to open down today. we are continuing this streak of positivity. thought it would be worth mentioning that obviously consumer spending, santa is here for macy's. everybody is thinking about the economy. we just got a 2.8 gdp number. and then we will hear more on what is happening with the consumer from american express ceo. here is a taste of what he says right now about the economy. listen. >> everybody is waiting for the thing to completely crash. we have all been planning for the recession that never happened. i just don't think you had that real boom. you had the boom come in from a tribal prospective. you had the revenge travel right after the covid lockdown ended. but i woulthat it is a stable economy right now. not one that is overheated. >> he does not see a recession

any time on the horizon. we talk more in depth, david, about what he sees from cardholders. they typically serve the more high income cohort which is why the credit quality on amex has been so good and how it has outperformed. we talked about what a new trump administration will look like for this group. there has been a lot of optimism on banks and credit card issuers. deregulation, which he doesn't call it. he calls it smarter regulation, is thought to be a beneficiary in this category. >> and m&a too. and see that discovered eal go through, right. >> that is the terms of oversight and the spot to be potentially beneficial. i have no reporting on one way or the other. we are still waiting for that to play out in terms of who runs the ftc and who will be the head of enforcement. >> it won't be lena khanna. >> respectively, they will be exiting. i think that is a safe

conclusion to reach without a doubt. >> whether or not we do see this boom and m&a that many are set up for, i think is more of a reasonable question. it is certainly possible. and it would seem more likely than not. but there are any number of issues there. including of course the aforementioned people that will lead these two. ftc and enforcement. we will see who they are. deal most of them need china approval and europe. and if we get a trade war, what is that going to do to the willingness of them to approve deals as well. while there is a great deal of hope i think that we are going to see and most likely will see a bump up in m&a activity. we still need to see, wait and see how much like so many things. >> pam bondi, might be seen as more friendly than matt gaetz who has openly commented and

complained about big tech. we will see who gets in that role of enforcement under the department of justice and the ftc. >> obviously come regulation of ai will be important. let's turn over all to that subject. we will start with open ai. the company behind chatgpt receiving a new billion-dollar investment from softbank. we have that story. kate. >> david, good morning. sources telling me open ai will be selling a new 1. five billion-dollar state to soft baked or a tender offer where current and former employees will share sell shares. and the softbank first invested $500 million in open ai and october. the mag around. this is all happening through the vision fund. a source tells me that it was

described as persistent looking for another opportunity to put more cash into open ai. it was raising a stake in the start up to roughly $2 billion. at a conference recently, he said he is saving tens of billions of dollars to make the next big move in ai. it is a way for current and former employees to get cash. they need to have held those stocks, restricted stock units, for at least two years. this is increasingly common and important in tech and silicon valley. the ipo drought, i did report that data bricks is in a similar situation raising between 5-$8 billion to get employees liquidity. for open ai, also a signal to potential employees that if the company is not going to go public anytime soon, there are ways to capitalize on its meteoric rise in value. one person says to expect more secondaries going forward and it is going to need to tap private markets again in the not

too distant future. back to you. >> the numbers are staggering. they raised $6 billion not that long ago. it is another billion and a half. some also going to, for employees to essentially cash out or former employees. at least we got numbers, the revenue ramp is quite significant. i don't know if they are looking at 4 billion this year or next year. give us some since. it is a lot more than x ai which reported $5 billion. the number overall is staggering, how much money is being raised privately for these companies. >> it does signal how robust private markets are. throwing around numbers like 5 billion are $8 billion. there is this investor demand and it looks like the ability, for these companies not to go public and wait in private markets and do these secondaries.

you have reported. back to your question on revenue growth, you talked to investors and they say they can underwrite it because of the growth rate of open ai. they are doubling revenue and some cases but it is not necessarily flowing to the bottom line. they are not profitable yet and they are willing to spend huge. and they are facing more competitions. they expect to raise more cash. talk about a perfect match for someone who has billions to spend and his appetite to spend and really wants a new investment in the ai space and is willing to commit to open ai. and then you have open ai who needs the cash. it is a match made in heaven when you think about the investment match. interesting one and it signals the softbank space. >> trying to play catch up there which is embarrassing for him because he was talking about ai. i remember sitting with him so many years ago talking about the promises of ai and then owning so much of nvidia, more than anyone. >> and sold it. by the way, made money. and

with the vision fund, kind of missed it all over the place. kind of a jump. from masa. i'm saying embarrassed. i don't know if he is. >> you cried on the shoulder the other day and he looked embarrassed. >> i remember the interview. he talked about sitting back and eating grapes and thought that ai would do everything for us. but he talked about that years ago. i remember that interview. is a good point. open ai has been restrictive about who investors can invest in. i have heard from sources that they are telling people they are not allowed to invest in competitors. that is also unprecedented and you are seeing that. if softbank is getting in on open ai, that has to be their strategy because they cannot invest in competitors in a way that may be five years ago they would have been able to. >> great reporting. thank you. speaking of playing catch up, take a look at crowd strike

last night. not a bad quarter. they did beat and sales were ahead. the guidance, not far from a consensus. they didn't point to any broad sense of degradation of the business model and the wake of the july outage which of course is the center of a big dispute with delta air lines. there was a downgrade basically saying that there is low visibility on growth for 25. a lot of notes with the titles saying, not out of the woods quite yet. >> i don't know. i went to the kramer investment club. >> jim was constructive too. >> i was going to say kramer and his team put out a really bullish note on earnings and pointed to this one metric which i thought was interesting. a realized gross retention rate of 97% which is an important factor given concerns about customers leaving the platform from that glitch, that outage, back in july. stock giving back 4%.

earnings movers to mention as well. nordstrom with results after the bell yesterday way were better-than-expected. 4% revenue growth. for nordstrom or any big department store right now is impressive. macy's earlier this week said sales were falling a little more than 2%. and it was 4% at the nordstrom rack and the stores. the outlet, rack, has been doing sort of all the work here with this one. we have 4% sales growth. that was abeat. women's apparel and activewear shot up by double digits at nordstrom. shoes, men's apparel grew by single to high digits. they did say, they were cautious on the guidance because they said in october, they saw a noticeable decline in sales for the end of october so it factored into holiday expectations which were not as strong and the guidance was not quite as strong as the growth we got in this quarter for the full year.

i think they were expecting a range of flat, to 1% growth which is a little better then they previously said but not considered that great. we are waiting to find out if the company will go private. the ceo and his brother, eric and pete nordstrom are trying to take the company private. a special committee. doing it with the help of a mexican retailer for instance. i think that has been one reason why nordstrom shares are up this year. they offer $23 per share. so trading just below 22. >> second try for them if i recall. glad you reminded everybody. frankly i had forgotten. i don't want to get ahead of you if you are putting together your consumer thing. are you doing that? what kind of comments have we gotten from these calls? >> it is very mixed. >> cautious consumer i think is a thing. i go back to the target resourceful consumer, value seeking consumer. nobody talking about a gangbusters

consumer. it depends on the category and then again, abercrombie showing no slow down. we talked yesterday and that is outperforming all retailers at 14% sales growth will also throw in an urban outfitters. they recorded last night too. it was a little better. sales rising six take a 3%. the story the story is not urban outfitters, the brand. it is anthropology and it is growing a little better. anthropology sales were 5.6%. it really just depends on if you have the right message an assortment for the consumer and you are perceived as a good value right now. that is ultimately what the most consistent thing retailers are saying the perception of value. >> urban did beat by a couple points on gross margin. they said they are optimistic about holiday demand. they do expect comps in the quarter to besimilar to the fiscal q3 and as sara pointed

out, it is anthropology. talking about executions. a surprising number of names you wouldn't have expected. urban is one of them. this will take you back to the summer. >> consumer discretionary retail names have done quite well lately and one factor is tariffs. 10% tariffs on china. a lot of the retailers when you talk to them, talk about how they have been making moves to diversify away from china. there are some that have been way more exposed then others and they come top of mine. best buy is one. electronics. it is hard to get out of china for that one. many have been moving their supply chains out of chinaand so have not been hurt as much by some tariff announcements or tariff expectations. and overall, we get a consumer spending number at the top of the hour. consumer spending and the inflation number. the outlook has been quite stable and it is underpinned by real wage growth which we have seen wages factoring in on the

impact of inflation and an unemployment rate that is up 4.1%. it doesn't look like there will be any major changes off of that and with an outlook for the economy on lower corporate tax rates or maintaining the corporate tax rate at this level and more deregulation. >> i did want to get back to a name that we already mentioned which is dell and then hpe. they are both features. dell is getting a lot of support from the analyst community. many coming out and saying it was a strong quarter and yes, the guidance lowered a bit. consumers were weak in terms of pcs but overall, in terms of the growth story there, it remains undeterred so to speak. on the ai front, they showed strong growth. both are getting hit. and that is largely on consumer pcs. back to the consumer, they don't seem to be yet -- being

brought in, so to speak, by the promise of ai in your pc and what it can do for you. >> jim has been skeptical about it. >> he was yesterday. he wasn't until he was. >> he was skeptical yesterday. i don't remember him being skeptical before that. it was after he saw the best by numbers and then he turned out to be. >> hp consistently and dell. >> that is true. >> even more data heading our way at the top of the hour led by pce. >> chicago pmi. this is not a good number. expecting a number under 50 and 45. we ended up lower at 40.2. that is the most weak levels since may of this year when it was under 40. 35.4. here is something interesting. we have had a 150 plus the breed

and that was november of last year, since august of 22. we definitely know that we are not seeing a lot of the activity and manufacturing in and around chicago. top of the hour, some of the most important data of the month in the form of spending and all of the pce inflation numbers that the fed is so fond of. squawk on the street will return after a short break.

welcome back. breaking news. hello. >> u.s. government officials confirming that there is a trade deal now in the works between the united states and the chinese government. a prisoner slob of detainees by

each company. until they had to wait until americans that were being detained in china were out of chinese airspace before they could consider confirm the news about u.s. official confirming that the prisoners swap is underway. three americans we are told being released from chinese custody are mark sweden, an american that was detained in china since 2012. he was given the death penalty in china for alleged drug trafficking. kiley, an american businessman, detained since 2016 was convicted of espionage against china in 2018 in china and john young, also held in china and released today by the chinese government as part of the prisoner swap. the two chinese nationals were being released from the united states to china including two people accused of espionage in the united states against u.s. interest including against ge aviation in a sort of corporate espionage episode that we did a documentary on here at cnbc

about a year ago. those two officials are the chinese ministry of state security and the centerpiece of the documentary and launched a long effort to penetrate ge aviation and get access to ge jet fan blade technology that ultimately failed and ended up with a dramatic arrest. and an associate who joined the u.s. army reserves and was inside the united states allegedly working with others in chinese intelligence in order to penetrate the united states military and potential u.s. intelligence. two chinese officials now released from u.s. custody, u.s. prisons and three americans on their way home from custody in china. >> the timing of this, is this the kind of thing we normally see in transitions or is in an attempt to foam the runway for better relations looking into 2025?

>> i think this is an end of the administration kind of thing as presidents are outgoing. a lot of work diplomatically behind the scenes for years regarding these americans that have been held on charges that obviously the united states would say are unfair. we have a statement from the security counsel who said we are pleased to announce the release of mark sweden and kylie and soon they will return and be reunited with their families for the first time in many years. the administration putting out a release saying that this is going back to months and months of negotiations and said president biden pressed for the return of americans wrongfully detained in the prc when he met with president xi at a pack. a lot of going into this prisoner swap between the united states and china including this fascinating case again of the person we spotlighted in the documentary a year ago who was trying to penetrate and get american

technical details for chinese industries. >> thank you. we have a record number of travelers expected to be hitting the skies and the roads on thanksgiving. investors are only rewarding certain airlines though. we have the explanation for that. >> there are performers and others performing better but they still have their own issues. that is why the airline stocks are not as high as the performing set. we will show you those in a little bit. the number of flights we are seeing this week according to the faa, the big hit was on tuesday, yesterday. we will see a big number today and then on sunday. more than 50,000 flights yesterday. and good weather around the country. and good pockets here and there. but no major storms bogging down traffic over large areas of the country. as a result, the airlines are

expecting the busiest thanksgiving ever. a travel of up 6% compared to last year. the tsa expects to screen 3 million passengers on sunday. that does not happen often. they did it a few times in july, this summer. 3 million is the busiest we have ever seen on a thanksgiving weekend. i talked about the performers. take a look at united and alaska. both stocks at a 5252 week high earlier this week. they have been on a nice role. these are two of the airlines along with delta that are considered the performers because they have increased their execution and margins are improving. there is delta. a nice run there. delta giving guidance last week that it expects 10% annual earning share growth over the next three years. and then there are the three airlines that have done better in terms of the stocks have done better over the last couple months. but they have their own individual issues. that is why we put them into the group of non- performers.

american, southwest and jetblue. we talked about american giving so much in the capacity bogging down the system. making progress. southwest with its issues specifically. the number of aircraft it can get from boeing and then we know what is going on with jetblue in terms of redoing it structure and then the issue with turbo fan engines. the bottom line is this, guys. it should be or it started off to be a smooth thanksgiving weekend travel for the airlines and if there are no major problems here they are, it should be a smooth one through sunday. >> i noticed yesterday ubs cut southwest. they cut american but upgraded united. i'm wondering if you are hearing a lot about strong dollar dynamics, driving, vacations and international travel to europe or whatever and looking to carriers that have that kind of network. >> that is helping united. we talked about this earlier this week, the fact that they increase to the number of routes and frequencies to a number of

their hubs, from their hubs over to transatlantic hubs. they extended those into the holiday season because there is so much demand when it comes to transatlantic travel. that has definitely been a fitted, carl. >> united has been amazing. i'm not sure why. you upgrade a stock and it is up 130% in three months and then you upgraded. >> rate analysis. thank you for that. >> when we come back, the feds mi ferred inflation gauge is cong out in a couple of moments pick the s&p trying to go for the first eight day street since august. stay with us! hive digital technologies is embracing the ai boom by supercharging its data centers with nvidia gpu chips, a move that diversifies hive's revenue streams and solidifies its position as a leader in the digital economy.

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the further we'll all go. good wednesday morning. welcome to another hour of squawk on the street. i'm sarah eisen with david faber live always from the new york stock exchange, ahead of a big data release. the fed's preferred inflation number will pass tomorrow

because of the thanksgiving holiday. markets are closed for the holiday tomorrow. we have team coverage. rick santelli is in chicago with the numbers. and market strategist dave zusho will join us with reaction and context. we will look at the markets and there is a mixed picture. s & p down a tenth of one percent. there is strength in reals and financial and healthcare. weakness in technology and then that is after some earnings releases, 10% lower in hp, more than that for del . inflation data just cross,ing, let's go to rick santelli. >> on the income side, double expectations. instead of up 5.3, we are up 0.6, that equals where we were in march. to find a higher one, you have to go to the beginning of the year in january, up 1.4. this is a solid number. if we look at spending, also as

expected but solid up 0.4 and that followed 0.5 of a percent. these numbers are strong. if we adjust for inflation and look real spending, up 0.1 and that followed 0.4 and that is the second best of the year. now the inflation numbers. we have four of them. the first of course is the price index, month or month. we are expecting up 0.2 and it is up 0.2. but for the last several months, we have had lower numbers. if you look at may, we were 0, and then one tenth, two tenth in august. that is a bit of an uptick. now let's take the same headline and go year over year, expected up 2.3, it comes in at 2.3. but that's not necessarily good news. the rearview mirror, it was 2.1, that was the best going back to february of 2021. and you have to go to july to

find a higher one when it was 2.5. let's look at the core numbers, the most important two numbers we have. core month over month, it is coming in at 0.3 as expected, same as in the rear view here mirror but if you look at where we have been, 0.1 in pay, 0.2 in june. this is a bit of an uptick. year over year core, this is really on the sticky side, expecting 2.8, it comes in at 2.8 and just to put a face on it, we have not been below 2.63 all year. so these are a bit on the warm side but as expected for the most part. yields kicking up just a smidge, about 4.26 and a tenth but for all of the numbers, we really have not seen a huge amount of movement. now we have home sales for october but for that we go to diana. >> ending home sales rose 2% in

october month to month according to realtors. that was a beat. the street was looking for a slight drop. sales were up 5.4% compared to october of last year, highest level on the index since march. mortgage rates rose sharply in october, starting near 6% and ending near 7. this is based on signed contracts, people out shopping in the month and inking contracts on a home. sales rose in all regions of the country, even in the south where we saw back to back hurricanes. sales of newly built homes, based on signed contracts fell slightly in the south enoctober. this bump in existing homes recently is likely because there is much more supply on the market. active listings up 29% year over year according to realtor.com. finally, my favorite stat, the lock box indicator, a count of how many door key lock boxes are open to show a home. the realtors say the openings were up 7% year over year in october which is much more demand ahead into the winter

months. >> thank you very much for all of that data. the big headline is that it is in line. it doesn't give us any major clues about what the fed is going to do. the overall inflation rate 2.3% was as expected. it is close to 2% but it is not at 2%. as rick said, core is at 2.8%. so it is a little closer to 3%. but that was pretty much as expected. it shows that it is not a straight line down. as rick said, 0.3% monthly gain in core pci is not as good as 0.1 and 0.2. so the fed wants to see that go down. but fed chair powell has said numerous times it will be a bumpy path down to 2%. will they still feel comfortable cutting? probably. before that number, the market was at 66% chance that they would cut in december. we are at no change it looks like after the numbers, not a real swing factor. i would note that the economy is

doing well. spending 0.4%, that was expected but it still shows signs of healthy spending. incomes were the surprise coming in double what was expected by economists. so wages higher, income is higher, bodes well ultimately for the consumer if you are looking for any signs of big changes or turns in the economy, you are not seeing that from the data and what we are getting now. >> i see personal savings, 4.4, is that a big change? >> glad you asked. we made a chart of the savings rate. it is kind of where we settled lately. so savings rate has been all over the map since covid. remember when it spiked during covid when we were all home and stimulus checks were coming in. it was up to 30%. we had a second spike coming out of covid but now we are

normalizing, a little elevated from pre-covid but the savings rate does not suggest a lot of stress out there. there is still some cash buffers for consumers but it is coming back down to normal levels. there is a big debate on what the fed should do now that we are getting pretty decent numbers and still signs of progress on inflation but some of the progress has stalled. peter bookguard has been vocal on this and we follow his notes at the book record. and he said from a risk management perspective, i think the fed will be badly misplaced if they decide to cut rates again in december rather than waiting to see what the trump policies are to come. they could always move in january when things are a bit more clear. the party going on in markets, obviously the stock market at a record high. the fact that bond yields have risen since the fed cut the 50

basis points, now the fed has done three-quarters of a point, 75 basis point. are they going to wait? they are certainly not going to react to any trump policy or preement any of the trump policies but some of the policies are seen as inflationary where it is higher tariffs or lower taxes and deregulation. i think we don't really know what the inflation outlook looks like from here without knowing the trump policies. >> and deportation as well could impact the labor market. >> it is thanksgiving tomorrow. the thanksgiving meal is down 5% from last year for the average cost for a family of 10, $58.08 according to the farm bureau. walmart said their meal was down 3% year over year i think there are 11 categories and 7 are in out right deflation

year over year from farm bureau. >> okay, that's good. we want to see that. it is signs of progress. we are going to hear later in the hour about the state of the consumer and what they are seeing from the fed as well. overall, here's a peek of what he says about the high income consumer which he mostly serves with the mx cards, listen. >> the nice thing about our members, they are high spending, high credit worthy, high income and they have a lot of discretionary spending but they are a little more cautious than they have been, same for the last few years. >> a little more cautious which is what we have heard from other retailers. and david you mentioned some of the retailers and it has been a mixed picture. if you are kohl's, you will talk about macro weakness. that stock got killed. >> we are starting to discern

how much is execution related to the retailer as opposed to broadly defined. >> softness in transaction. that's what it comes down to. nordstrom pointed to some weakinous for october and what they are seeing for the quarter. they saw better spend in the quarter but a couple weeks in, it was weak. and they shared what they saw which was a decline in trends but too early to pull that apart. burlington, that is off to a good start. they are looking forward to colder weather because they sell a lot of coats. but clearly, it is mixed depending on where you sit. >> let's get some context on inflation and other data with our senior economic reporter steve leaseman. first on pc? >> when you have a 1% decline in goods and 3.9 up in services, i can't find the number on housing

and how much that has an influence where the ace in the hole is for the fed, where they expect the housing inflation numbers to come down. right now you have a still declining numbers on goods. that's by the way getting back to your conversation with the tariff issue comes in, what if you reverse that trend of negative numbers on goods by slapping tariffs on it? that will hurt the pce even more. and you have the notion that maybe they will be front running the tariffs that could bring in costs along the way. so concerns about the coming months. and then you raise a very interesting question of when, how, or if the fed addresses some of the coming policies. if powell were to hold true to what he has said in the press conferences, it would not be for a while. if you think of how this would lay out, first they are proposed, then enacted, then they have an effect on the

economy, and then they show up in the data. it may not be until they show up in the data that the federal reserve would end up addressing them through policy or affecting them through policy. i thought the minutes were interesting yesterday, a lot of talk about what was going on in the economy but it was the day after the election and not a lot of talk about that and the uncertainty that is engendered by the election and new policies coming from the new administration. but overall, i like your take on it. it looks like the economy is doing kind of fine. you had a nice pickup in income at 0.4% when adjusted for inflation. that helped the savings rate go higher. you didn't get the spending. but if you are a retailer now, maybe you are licking your chops and say maybe they were holding their powder for the coming holiday season. the consumer does go into the holiday season, it looks like from this data in pretty good shape. >> so what does the fed do with all of this?

it's a pretty good economy. i did note that part of the minutes where they said the risk towards softness in the labor market has moderated a little bit. is it time for a pause? >> that was in there. look, if you take -- if you take the idea of recalibration seriously and the way i interpret it, not everyone else did, it is a change in the rate that is somewhat apart from the data in the sense that you bring it down to a level and you say, okay, at that level, is where i'm going to adjust and calibrate to the actual data. if i'm recalibrating, it is because i was too high and i need to bring it down. it sounded like cash carrie may be in that same camp to the fact that you can do a same quarter in december and then recalibrate

after taking 100 off the top. now your recalibration is done. >> the question is how do they know how restrictive they are being? it is really hard to tell right now. >> it is definitely hard to tell. that was a point that was made in the minutes yesterday. and the reason to go gradually. but if you take a step back and say, okay. what was the neutral rate before the pandemic and why would it have changed so much now that it would be in the 4% range? i think if you stopped at 4 or 4.25 and you say let's wait to see how it works, remember, some of the, i would suggest, some of the positive economic data we have right now could be the result of the fed pivoting a year ago and bringing rates down. so that's an issue that is out there. the market has priced in rate

cuts. the fed probably needs to deliver them not just for wall street but for main street where rates are still high. >> thank you, a lot to digest. we will come back to you. let's get the street's take as well and bring in david zush who is joining us. your thoughts? >> i apologize for sounding like rfk jr. a little bit moy voice is running out of steam, a lot of calls with a lot of clients and running around. i wanted that caveat up front. >> okay. >> i don't think the data matter that much for the fed. this was a pretty down the middle data print. it is important but i think there was any surprise to get them to move either way. i think the markets so far have told you that we have a lot of big picture stuff to talk about. it is fun to talk about the day to day in the market but i'm just getting so excited for the

deregulation train, the smaller government train. the fact that the bond market, the yields are lower than they were on november 5th in the 10 year by 5 or 6 basis points. >> and trump was supposed to be a big steepener. >> and the stocks are up and dollars are stronger. it is all working the way people thought, not the 17 nobel laureates that thought that armageddon would happen if trump won but i'm focused on the long end of the treasury. that's the most interesting story of the last three to four weeks and it is telling us something. people are getting excited about the deregulation train and the lower cost of productions that are coming and possibly the less significant government sector that is i think starting a lot of conversations with our clients about could we see some slowing in the beginning of this administration as contract payments are ceased, consultants are cut, job losses in the

government sector start to come in. that totally changes the january to march to june fed sequence if we start to see different job data. but coming more from the public sector than private sector. >> does that mean gdp forecasts have more down side blast? >> there is an initial trade and longterm trade. >> sure. >> are you opening up the economy to better use the resources more efficiently in the private sector? that's the idea. >> musk called it temporary hardship. >> i think the market is starting to sense that a little bit. we will see. the short-term data will be really interesting to watch. january 20th, we will see a lot of changes really fast. we know there are close to 300 executive orders that the afpi have put together to put in front of president trump on his desk. a lot to do with deregulation, immigration, and other things. but i think a lot of industry shackles will come off.

but a lot of changes in washington will happen with the department of agriculture, department of education, department of energy. these are big, big changes in the way in which we have done business as a government for decades. this is a reagan sort of moment. >> one thing you did not mention that you were excited about is tariffs and that's something we are getting a good whiff of. >> you know, i think it is something i push back to the side along with immigration because i just don't think the stagflationary outcomes that people are pointing to the magnitude is there. we will see. we saw it last time and what happened to inflation? not much. >> they weren't as widespread, though they were more targeted, steel, aluminium. >> we don't know if it is tactical or not. we will see if the tactic works to get open markets for our products, get fair trade, get geopolitical tensions down. we'll see.

that is the history of trump tactics. you go in big. i think wall street is giving him the benefit of the doubt on the art of the deal style and they are not going, oh, yes, you are definitely going to do this number. >> it closed at a high yesterday. >> and i love it. i love the way we are lining up. >> finally your note, you talk about the difference between deregulation and deregulatory capture and you make a difference in the selection of scott besent versus scott ruben who came from the banking side. what are you trying to get at there? >> when you go through a deregulation period, industries can capture that period just like they use regulation to capture an industry like the nobel prize winner used to write about out of the university of chicago. if you think of what happened with grand blighly, with the end of glass steel, the 1990s deregulation, that set up the

ability through deregulation to have a regulatory backdrop that still forced a bailout in 2008. it allowed banks to do things that were unsavory. and ultimately it blew us up. so as you are rewriting the regulatory structure, through deregulation or more regulation, having the insiders, having the industry write that is always a dangerous game. what i'm happy to see in many of the positions as we go into a deregulatory environment is not executives from the biggest parts of the industry that have already captured a lot being a part of the deregulatory unwind. that made me very happy when i saw scott's name. and i think marc rowan is an outsider as well. these are not the insiders of the commercial banking industry. so i'm really getting very positive on the deregulation

train from a short-term perspective and also alongterm perspective. what you worry about is that you can take all of the regulations away but we did that with savings and loans in 1982 and then caboom. and then we did it with glass steel, boom. it is fun for three or four years but the end of the party is not pretty, the hangover. >> we remember a couple of springs ago when it was all about the fdic. >> you have to think about that as an investor. >> we will talk a lot in the coming months. >> hopefully my voice holds out. >> thank you, david. looking at the rest of the hour, thanksgiving kicks off, retail's biggest five day stretch of the year, the names that might benefit after the break. and the state of main street as we head into a holiday season, an exclusive with the ceo of american express. and inflation came in as expected, more from a fed member who says prices could be headed

higher. we have a big show for y. ua iousqwkn the street will be right back.

welcome back to squawk on the street. thanksgiving day kicks off retail's biggest five day stretch of the year. and we have a closer look at what we can expect. courtney? >> i hope you have a shopping list. we are moving from big earnings to the big five. the unofficial start begins tomorrow online for major

retailers even though many have early cyberdeals in october or november. spending between thanksgiving and cyber monday will hit a new record high of $650 per person, that is up 15% from last year. that also means that 56%, more than half of total holiday budgets will be spent over retail's big five. interestingly, all households plan to spend more than last year in the stretch. black friday is still expected to be the busiest store shopping day of the year but not as big as years ago. however, now that most large retailers are again closed on thanksgiving, that sort of happened during covid and we continued it, it has pushed store door busters to friday morning and that helps to lift traffic on black friday again. adobe analytics predicts 27% of online spending will be spent online. that is equivalent to $40.6 billion, up 7% from last year with the biggest growth beyond

black friday online with 11% gain in spend over the day last year. when it comes to what shoppers are buying, apparel and accessories top the list again, hopefully a boost for retailers who have been struggling in the cat gir from what we haurd from the third quarter reports. and electronics are often the top promoted items, they are the seventh most popular gifted item in total for the season. >> gift cards are number two? and electronics number seven? retailers love gift cards. >> they do but what is so funny about the gift cards is they can't recognize the revenue until it gets cashed in. so for all of us who are hanging on to the gift cards, retailers don't get to count that. so it is interesting how the economy works on the gift cards. >> but they are paid for. it's interesting. i have a whole drawer of them. thank you, courtney. coming up, a rare exclusive

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welcome back. i'm pippa stevens with your cnbc update. a cease fire between israel and hezbollah went into effect this morning. israel's military pounded nearby gaza with strikes. strikes on two schools turned shelters killed several including two children. israel says it was targeting hamas's sniper unit. harvey weinstein's legal team filed saying he was receiving sub medical care. he is being treated for diabetes and cancer. he has been in jail awaiting retrial since the 2020 rape conviction was overturned earlier this year. two companies have dropped

connor mcgregor after an irish civil jury ordered him to pay a $250,000 fine to a woman who accused him of brutally raping her. they will no longer feature his name or image on the whiskey and video developer im interactive scrubbed him from the hitman video game. >> thank you. ahead, an exclusive you do not want to miss, american express ceo stephen squeri is xt as the shares hit an alltime high at the open. we are back in a moment.

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welcome back to squawk on the street. shares of american express on pace for the best of the year, hovering at alltime highs ahead of big days for consumer spending. i did sit down for an interview with the ceo stephen squeri who is celebrating the 50th anniversary of the initiative, small business saturday expected to bring in $200 billion this

year. i started by asking about the state of small business and the challenges they are facing. have a listen. >> we have had a situation where we had inflation, we have high interest rates. you know, you heard this today, a lot of them still haven't recovered from covid. so i think small businesses are on the upswing. i think that's why it is really important to support your local small businesses. we just did a survey of small businesses and you know, 95% of them are feeling more positive and they believe the sales year over year will be more positive but if you think of the places we went to today, we went to the local butcher, a couple of restaurants. they really count on this period between thanksgiving and new years to make the year. you heard more than one of them say it puts me in the black for the year. so they have struggled. they talk about high labor costs and so forth. but i think they are coming back, but it has been a much slower climb back than any of us would have hoped for.

>> it has been a big priority for you and the business, you have done well with small business loans but what about spending which has seen a recent deceleration? what does it take to get that back? >> there are two things with small business. there is the merchant side where consumers come in and spend and that's going pretty well. then there is the money that the small businesses spend themselves. what we have seen is, we had, we talk a lot about same store sales and organic sales. precovid, small businesses organically grew about 3% a year. then a year or two after covid, it was a 20% and 23% growth as people were looking to worry about supply chain issues, they were worried about inventory and so forth. but as interest rates got higher and the costs of goods went up, they were not keeping the same inventory. so small businesses are spending a little below on the same base. we are starting to see that taper off.

it is organic growth that is not positive at this point but we think over the 12 to 18 months, we will start to climb back . >> why? what is the factor there? >> the grow over is long. you had a situation where small businesses putting large transactions, never intended for credit cards on credit cards during covid because it was the only way you could pay. some of the advertising spend and things are falling off. i think they are getting more comfortable with their inventory levels as they start to think about what their sales will be for the next 12 to 18 months. so that's what i think. i think we will get back to a reset. maybe it will not be back to 3% but it will not be negative. >> what about card members overall, american consumers, how do you describe how the health has been so far? >> it has been stable for the last four quarters for us. when we look at the overall spending on a global basis, it is about 6%. u.s. consumer card spending is

about 6%. if it were strong, then it would be 8% or 9%. but 6% is not a bad level to have in an economy that i wouldn't say is exploding at this point, right? you know, we are optimistic about the future. the nice part about our card members is they are high spending, high credit worthy, high income and they do have a lot of discretionary spending. so they are continuing that but they are a little more cautious than they have been, the sort of same caution for the last four quarters. >> how do you characterize the state of the economy right now? you say it is not gang busters but not bad. >> it's not bad. we did this interview three years ago and everyone is waiting for it to completely crash. we were planning for the recession that never happened. you didn't have that real boon. you had the boon from a travel

coming in, revenge travel after the covid lockdown ended. but it is a stable economy right now, not one that is overheated. >> do you think we will get the recession? >> i don't think so. i have not seen any signs of this. we have been talking about it since 2019 and i haven't see it. i look at the organic spending from a consumer perspective and it is still hanging in there strong. i look at the demand for credit cards in the market place from previous card holders and that's strong. i look at the credit metrics. they are better than 2019 at this point. so we feel really good about that. >> does that speak to overall credit quality or just your consumers are more high income? >> if you look at my competitors, the difference between my writeoffs and the delinquencies around my competers thaz gotten larger but they have started to level off and stable when you look at the

third quarter earnings they had. they have seen a levelling off in credit. i think the fact that we are lower than during the pandemic speak to see the fact that i think the credit quality of the consumers we have has gotten even better. one thing we leaned into is millennials and gen z. those millennials and gen z have good credit quality. we are talking about everyone but we are picking off the cream of the crop and it helped us. >> it is an increasingly large percentage of your overall card percentage. what is the difference in their spending versus the boomers or genx? >> if you go back before, 19% was millennial. and now the growth rate is 12% on that cohort year over year. so genx and boomers is a lot lower. what we are seeing with millennials and gen zers is they

are leaning into the product. you ask yourself why. years ago when we had coverage issues in the united states, people would ask do you think the card will be accepted or i wouldn't use the card at a supermarket. millennials and gen zers don't know any better. we have had coverage in the united states for years now. they pull a card out for everything. we get a higher share of the wallet. they transact more at restaurants, 70% more at restaurants than genx. >> is that why you bought resi? >> the reason we bought that and followed up with talk and roam, our model is one where we connect merchants and card members. so resi and talk connects our restaurants with card members. when we bought that, i think we had 7 million registered users and now we have 50 million.

the beauty is that not only does it provide dining benefits to card members but it shows noncard members what the benefits are of having a card and becomes an acquisition tool. and talk sat in a different place with wineries and others. they had 55 million users. the then we bought roam which will connect talk and resy to a point of sales system. so it comes back and you know the person made the reservation and they ordered the sea bass and so forth and then it turns into a crm system. so it works out well for us. it speaks to our model where we have a closed loop system where we are connecting card members and merchants. >> i was going to ask about categories and which are doing better than others. >> restaurants are doing great. restaurant prior to the pandemic

was not our largest segment. now they are. looking at the gold card refresh, we leaned into restaurants. you think about restaurants, you are talking about fast food and coffee and things like that. we put a dunkin' donuts benefit on that, a five guys benefit, a resy credit on that card as well. it is the card that millennials and gen z flock to. restaurants have done very well. we are punching well above our weight from a restaurant perexpectative. that is because we have taken a strong stance in restaurant from not only technology perspective but offers. >> what about travel? you mentioned the pent up demand with covid. i think it lasted longer than we thought. where are we now? >> i took a look at travel and the bookings with our consumer travel business for november and december and the bookings are higher year over year. in addition to that, more members are going international

in november and december. so travel is still strong, it's still strong. >> it's stronger than prepandemic? >> we are above prepandemic. >> you can catch more of the full interview next hour on money movers. we discuss what a new trump administration might mean for his business and what regulations we are looking at and also some other revenue targets. i think you can hear and see why that the stock is up 63% year to date. visa is up 20%. they have an exposure to higher end consumer who is spending more on an organic basis. squeri still says 10% revenue target for the year and credit quality is better. he mentioned the gap in the credit quality between his competitors and the higher exposure to millennials and gen z and their preferences for spending. they spend more. and also bullish on travel what he said there. he looked at the travel bookings

for november and december and said they were higher than last year and did not talk about a slowdown that we hear from some of the hotel companies. and international travel is a theme we are hearing as well. >> and what the dollar is doing. >> dollar for sure. and there is still a pent up demand for travel. it started domestic and has moved more internationally, restaurants too, a strong area. >> he was saying how strong that is and the ownership of resy gives them a good deal of data. >> and they bought talk as well. as far as the overall spending numbers, what he said, he used the word cautious to describe the consumer but stable was another agjective he used on card holders. on small business, he was talking about the visits we made. we took a tour of the town of westfield, new jersey which is a place that he frequents. we went to a local pizza restaurant, a great

mediterranean place, talked to owners. we were there in an interior design store where we did the actual interview. we talk every day about small business and optimism, why they are feeling so lousy and why is it so pessimistic when the economy is so good, go out and talk to people. they complain about higher rent, higher labor costs, hard to get workers. they are still dealing with inflation, it's big one. >> in the middle of a great economy as squeri just described. >> but he said you hear the challenges up close and they are not thinking about the unemployment rate. they are thinking of how they will pay the rent and pay their workers. >> fascinating. i think they call it the yelp effect where you are more likely to complain about things in this era of social media than appreciate what is going well. >> and i think these are not the big businesses of scale that we talk about in the s & p 500.

it is harder every month to deal with the costs they face. they haven't seen a lot of relief. they are all still reeling from covid a lot of them. the meat shop, people bought their meat online. they were not coming in to buy as much because they got used to changing their habits. >> interesting, a lot more to come in the next hour. one earnings mover to watch is del. it is slumping after a disappointing fourth quarter guide. with the s & p tech still a top ten performer on the year. why one former fed official is warning that trump policies may add a percentage point a year to inflation. we will join us in 3 minutes. don't go anywhere.

the u.s. dollar has been on a tear but it is on pace to snap an eight week winning streak after hitting the highest level in two years just a little while ago. with big changes afoot for the incoming trump administration, what will the longer term trajectory be for the green bag?

we will chart the course in our market navigator segment later on in power lunch at 2:00 p.m. eastern time.

the feds preferred inflation indicator, pce coming in line with expectations. our next guest warns prices could be higher from here, arguing in the wall street journal this week that the president-elect's policies could add a percentage point a year to inflation. joining us now is former federal reserve vice chair, alan winder. good to have you. where do you get the calculations of a percentage point or more a year for inflation? >> nice to be here, good morning. i'm almost tempted to say i pulled it out of a hat. i didn't. i did the best i thought i could because we don't know what the trump policies will be. he is sort of all over the map on tariffs. lately it is mexico and canada, i didn't know that when i penned

that wall street journal piece. i made a guess that it would be 10 to 20% across the board with more on china, based on what trump had said. as your screen shows now, if you do the path on that, it is a point and a half to three percentage points over a couple of years let's say of more inflation. what i really didn't know what to make of and i didn't put a number to it is the crackdown on immigrants. i almost did illegal immigrants but i'm sure some legal ones will get scooped up in this process. we don't have any idea how vast and large this is going to be to sort of assess what the inflationary impacts will be in the next year or two. what's clear is that they will be inflationary. you tog about restricting the

supply of labor by nontrivial amounts, how much is anyone's guess. it will not be 11 million in a year. you are almost pressing the laws of physics on that. he's not going to do that. but it could be sizable. it could add more to the kind of inflation numbers that i was trying to guess from the tariffs. >> at least on the tariffs, you have heard the argument which is that last time around he did tariffs and first of all, he uses them as a tool for negotiation, and second of all, we did not see a big flare up of inflation. so why are you thinking this would be different? >> first of all, the evidence is that that did raise prices, first of all. it got swamped by many other things. >> couldn't this be offset -- first of all, couldn't corporations take the margin hit if they are dealing with lower taxes than expected, lower corporate taxes is a big part

and deregulation? maybe there is some room there. >> maybe, they could but the evidence goes the other way, that they tend to pass these things on and they did in fact in 2018 pass them on. the other point though that is important is that the tariffs that were promulgated in 2018 are smaller than what he is threatening now. now as i said before, what he will actually do is anyone's guess. but if he comes up to the promises, if you want to call them promises, we are talking about larger tariffs than we have before. but you can take all of that into account and go to the low end of my guesstimate and then we are talking about 1% and not 2%. >> do you think that the net effect of all of the policies and he has been clear on the agenda and put in place, a lot of people who talk about lower taxes, deregulation, targeted

tariffs or staggered tariffs, do you think the net effect is better economic growth, higher economic growth overall? >> for some things, certainly not the tariffs. the tariffs are anti-growth for sure. i don't think there is any doubt about that. >> but the market is telling you it is net-net better. >> some of the regulations -- some of the deregulation will be pro-growth. i don't doubt that. if he cuts taxes, if he extends the expensing and corporate income tax which he said he will do and i believe congress will pass it, that is also pro-growth. so there are pro-growth pieces in it. the biggest anti-growth piece from my mind is the piece whose magnitude at this point is imponderable which is the mass deportation of immigrants. as i said a moment ago, you are

talking about a fair number of workers, a number in the streets, agriculture, construction, manufacturing, but less there and some others. that is certainly anti-growth. >> it remains to be seen. >> if it all washes out, that could be, that could be. >> it remains to be seen. finally on the new administration, there are new concerns about the fed and fed independence. i'm sure you share at least those concerns? very much unclear if anything will happen on that front. >> very much, but perilous, very perilous. it doesn't take much for the white house to undermine the federal reserve. you can't fire jerome powell. but he could do other mischief with the federal reserve. there are various and sundry things that he could do. i can't imagine there are many people in this country that think donald trump will do a better job on inflation than the

federal reserve. as i said in the wall street journal piece, i think a real line on the fence is that the stock market will tank if it seize a serious as opposed to -- everyone hears a lot of rhetoric out of the president-elect, but if it looks serious that he will do something serious to undermine the independence of the fed, i think he will see a severe market reaction. >> i haven't heard a lot of rhetoric from the president-elect on the federal reserve but it is definitely out there. alan blinder, thank you for joining us. we appreciate it. >> you're welcome. >> former federal reserve vice chair and also part of the clinton team of economic advisors as well. we have some overall weakness in technology in particular. we have talked a number of times about the earnings mover, many to the down side whether it is del or hp or auto desk which we

have not hit which seemed to be decent numbers, crowd strike and then nvidia which we saw as well adding to losses after losses on monday though it did have a bit of a rebound yesterday. that will do it for this hour of squawk on the street and our live market coverage. have a great thanksgiving holiday everyone. id bll see you back here on frayut we have a lot more for you straight ahead. 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. when you're looking for answers, it's good to have help. because the right information, at the right time, may make all the

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good wednesday morning. welcome to money movers. i'm sara eisen with paul continue. today, the ceo of american express on the company growth plans with regulation under a new trump administration and for the economy. a small business ahead of the crucial holiday shopping season. dell is down today after posting results why it's reliance on nvidia is a big heart of the quarter. the ceo of autodesk, one of the biggest players in construction design industry and why the stock is moving lower despite raising guidance