arguments in january just nine days before the app is scheduled to be shutdown in the u.s. it's thursday, december 19th now and "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. here we go, folks. yesterday was a day for the markets. you've now seen the dow down for 11 sessions in a row the longest losing streak we've seen since 1974. the longest we've seen since 1974 you are seeing a very, very

slight pick back up. dow futures up 63. s&p futures up 12. the nasdaq up 50 points. it comes after yesterday's selloff in the markets where the dow was down 1,100 points. 2.6% the s&p was down by nearly 3% and the nasdaq was the worst performer down 3.5%. treasury yields moved very rapidly after the fed not only came out with its cut, but really the conference with jay powell that really kind of moved things the idea that inflation is going to be the target for the fed and you see the ten-year above 4.5% at 4.52. the two-year at 4.31 then bitcoin overnight moving to $102,000 overnight, the bank of japan did hold rates steady. economists expected a hike of 25 basis points the yen fell sharply against the dollar over the announcement

the boj said it would have to accelerate at future meetings. it was what the fed had to say and the chairman said. >> nine straight days down as we got into what would be a hawkish cut. nobody liked it all along. >> we knew this would was going to happen. you knew -- >> far more focus on inflation than the market was expecting. >> we have been focused on it. we have been talking about it constantly. >> i think he made the right call >> i think we give him way too much leeway. it was clear to everyone we had on, even former fed officials. >> she said don't cut. >> the nasdaq had been up. the dow was down nasdaq was up 3.5. yesterday was down 3.5 it caught up y split with

where we are when you are cutting rates, try to cut rates, we cut 100 basis points unless people are worried you are screwing up, the long rates don't always, you know, behave, but it looks like, you know, inflation is not laid to rest at this point now the lead story in "the journal" is maybe we are neutral. they were so sure we were restrictive. there is no way of measuring what neutral is. it is how the economy has been behaving. >> loans are plentiful and businesses had plenty of time. >> bitcoin. >> what about bitcoin? over $100,000? >> i was trying to figure out. >> it has been moving so fast.

it got up to 170.07. if they say it is not three or four and now two, it is immediate reaction we didn't know if we were going to hold 100 when it got up above there. >> the market has been so prepared for the fed to continue cutting rates and expecting this for some time to come. i think when powell started talking about they are focused on inflation and the labor market and the idea the dual mandate sought there i don't think it came to a lot of watchers as a huge surprise, but it came as a surprise to the market which has been wanting more cuts and the dot plot would hold. >> pi my word of the day is allf the above. the other day, it was buy the dip t. could be a sentence it is all of the above if we had residual inflation right now and we're thinking

about tariffs and they mentioned it we never heard jay powell complain about the i.r.a. or chips. never heard him complain now i'll factor tariffs into my thinking that's the first time he looks at a policy he thinks might be bad. shutdown shutdown showdown? that's not happening that probably added gst. >> he said it has happened several years in a row and inflation targets had not been met. >> remember transitory >> i don't think we are wrong with the hawkishness of it we are have been talking for weeks they shouldn't cut i was happy to hear him focus. >> what are we down now? 5% total >> from the s&p, not even that i was just looking at it

3.5% from the all-time high. let's talk about what is going on in washington we may see what happens in 2025 at this point. let's talk about 2024. chaos in washington this morning. this is the government shutdown looking now likely president-elect trump joining elon musk and calling on republicans to join the stopgap funding bill that had been put forward by house speaker john song jd vance putting out a statement urging politicians to pass a streamline bill that doesn't give democrats everything they want and raise the debt cease ceiling. that came after elon musk posted about the bill and urging republicans to vote against t. he posted the following on x, he said shutting down the government, which doesn't shutdown critical functions. they have until midnight to pass a bill and send to president

biden for his signature. if there is no deal, there would begin furloughs. one job that could be in jep jeopardy is house speaker. he would need the majority support in the full chamber to reclaim the gavel. we will talk to congress member pete sessions, cochairman of the doge agency. giving yourself a permanent raise, for example. >> they haven't had a raise in 14 years. >> sure. if you give yourself a raise >> they have been doing a heck of a job pay for performance. >> $243,000 a year from 187 or something, was the range also, look, if you are going to pay for the s stadium so many things in pork in this

big. >> this is the normal way of doing business is not going to happen anymore. >> that's going be very, very interesting. >> there were billions in there. more billions. you know, to get another 1 trillion, takes a billion. we have leeway every little bit, i think, does matter we tried to get a lot of different house people on today. >> i know. >> for some reason -- >> the ones we had canceled. >> we finally got some of them >> it is a little -- i think house speaker johnson, close to the president-elect and supported him for a long time, got caught off guard by this >> maybe he shouldn't >> nobody knows what's happening. he said yesterday, house speaker johnson said he was not only trying to reach out to president-elect trump, but he was texting back and forth with

elon musk and vivek ramaswamy. >> saying stop posting on x? >> he was saying what looks like the plan what should we do. i don't think they had a back-up plan. >> he's had some leeway and he's gotten away with getting some democrat votes to get what he wanted in the past sooner or later that might work. yesterday, we thought he would get democrats. i saw schumer. schumer loved the deal when you see schumer saying we got everything we want, there's republicans that will hear that and say if schumer says we got everything we want, we definitely don't like this there were no cuts in it now they want a clean bill democrats are saying no. clean bill would mean there's cuts. >> it's not just a clean bill they're looking for, they are looking to raise the debt ceiling and do it on the watch of president biden versus incoming president trump that's going to be it. you will not get a single

democratic vote. the question is can president-elect trump make sure every republican votes on this he said last night on truth social that anybody who doesn't vote for this will be primaried. that's going to be the test. >> all in all, we have been saying it. >> i don't know what this is >> if you are 22 times earnings and talking about tariffs and cuts and all kinds of stuff. >> no more fed cuts. >> there may be what you were worried about if doge is going to do all that elon talked about it there may be pain near term. then again, maybe you don't want a sugar high >> buckle up it's going to be interesting. in the meantime, tiktok has a court day to effectively ban tiktok is constitutional the court will hear argument on january 10th the ban on tiktok is set to take effect on january 19th i don't know if they get a hearing.

>> they are banning tic tac? >> no. >> that would hurt a lot of people ruin a lot of people's days. freshen a lot of people's breath >> tic tac >> decide it's no good. >> that's a beautiful white color. the cinnamon ones are really red of the tic tacs. >> really hot. >> really hot. that's hot you know, paris might be coming on >> that's hot, baby. >> that would be hot with her mom. >> are you serious >> i am serious. >> wow >> she's a big deal. she's on "real housewives. >> i was aware of it, but i

haven't seen it. >> i'll have a lot of questions. those women, they don't just always get along it's kind of like around here. >> not manufactured here either. when we come back, we dig into fed chair jay powell's comments on slowing the pace of rate cuts next year. former fed vice chair roger flight ferguson will join us. if you listen to what he says -- >> he should have been more strident. as we head to break, a look at the selloff yesterday a little bit of a bounce back. the dow was down by 1,100 points yesterday. this morning, indicated up 75. s&p futures up 5 nasdaq was down 3.5% we will continue to watch what this means "squawk box" will be right back.

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if the economy remains strong, we can dial back policy

restraint more slowly. if the labor market were to weaken unexpectedly or inflation fall more quickly, we can ease policy more quickly. >> that was fed chair jay powell yesterday after the central bank cut rates by 25 basis points and signalled the pace of cuts could slow next near joining us is former fed vice chair roger ferguson he is the former ceo of tiaa roger, we have been waiting for you to be our fed explainer on all of this. it didn't seem to me like what jay powell said was anything hugely shocking. it was welcome to see a hawkish version of this because so many people weren't sure they should cut rates at all it did come as a huge shock to the markets. what do you think of what jay powell said and how should we interpret it

>> let me start at the second question which i think what he said is actually right he recognized that on a 12-month basis, inflation has been moving side ways for a period of time of time. it was, therefore, time to really change the narrative. what i think he did was right. why did it shock the market? good question. you know, i think the market has gotten itself used to the fed being very much on track without actually looking at the underlining data i'm not sure why they were ignoring the fact that inflation was not moving down as quickly as people hoped. i think this is the miracle season the miracle of hanukkah or the miracle of christmas i think they did the right thing in the market. adjusted appropriately. >> okay, so, the idea that the market was not listening to what fed officials had been saying, had been hinting, are they too

reliant on the dot plot getting these cuts i look at the dot plot now looking at two cuts. maybe we'll see. i wouldn't be marking that and betting money on that at this point. >> i'm come pletely with you they have attempted to say the dot plots are not a forecast if the economy unfolds as expected, perhaps the dot plots come true. i think it is wise to look at them through that lens and never forget while there's a so-called dual mandate, inflation is the most important thing the fed has to look at and they have to be ground in reality. they were confident it was moving down. there were ways to suggest this is moving down, but it has clearly stalled. i think the market was ignoring the data coming in and putting too much forward guidance on

data already out of date i'm very much with you i'm not sure they will get two cuts off next year either. we'll see how things unfold. >> roger, we never know if there was a mistake. it is a very difficult needle to thread everything exactly right all the time in the past, there have been some mistakes. if they had to take back the 100 basis points and if the 100 basis points cut is why we stalled in terms of our progress on inflation, because it was too soon, i mean, it's possible, isn't it we could get no cuts next year and be back to hiking if inflation really, you know, if we're underestimating how resilient inflation is and god forbid, we could be messing up both sides of the mandate and a

slow labor market while that's happening? >> i think chairman powell e acknowledged in the clip you played at the very beginning it is possible to go either way when asked about a rate hike next year, i thought he was pretty tentative before saying that's not the plan. i think, you know, at this stage, there is no pre-cooked playbook that would determine what happens next year it's going to be incoming data you have inflation that's stalled a bit. labor market that's in balance, but i would not say it's softening dramatically frankly, we have an economy that appears to be growing at our slightly above trend and a brand new set of policy additions. i think it's a formula for ooth either occurring and as becky said, i would not put too much weight on the dot plots. >> you think we're at neutral,

roger? you really think we're at neutral? that means what we thought was restrictive is not as restrictive as we thought. >> well, as i said to you a few times on this show, you know, the economy has been growing roughly at trend, maybe slightly above. so, that does imply we're closer to neutral than maybe the fed itself recognized. we add to that in some places very loose financial conditions. think about equity markets that's not the only way to measure it, but certainly, still ongoing wealth effect. i'm always in the camp we don't know where neutral is and it's higher than thought and that's exactly where we are today >> roger, we've got to go, but it sounds to me you think the market's reaction was an appropriate if they were listening to chairman powell's slower pace of cuts and selling

off when it comes to equities and seeing the ten-year yield pick up a bit. did that surprise you to see the ten-year go above 4.5% >> no, it's all part of the same story which is, you know, not as confident that inflation is coming down. it is moving sideways. let's price it in and price in fewer fed cuts and possibly no fed cuts i think the market did the right thing. >> roger, thank you for your interpretive work this morning we appreciate it you said what i thought you were going to say it means a lot coming from you roger, the former vice chairman of the fed he has been right on what the fed was going to do for so much of this and very right on interpreting what was happening around the edges we appreciate it thank you, roger >> there's a whole contingent in the market all they want are more cuts. all they want are more cuts. >> right. >> they don't care when we stayed at zero too long last time and all hell broke

loose. they don't look out that far they want rate cuts now. today, today, today. >> i'm not surprised by what powell said yesterday. i think, i think what roger said is the right interpretation. >> it could be simple. i'm not getting my four cuts. >> i don't know if they're getting their two cuts. >> if you really want to take your medicine and be adults, there's no reason to cut. coming up in the show, another former fed vice chair richard clarida will join us and react to the fed decision. we have economic data as well you can react to >> i have to make fun how you said that. economic data today. you made fun of my tic tac >> when it is in teleprompter. i try not to read it if we're talking about it

happening, it's today. redundant. it's fed day today say it's fed day as we head to break, here is a look at the shares of tesla. stock fell more than 8% yesterday, but it's rebounding this morning oh, my gosh. rebounding today we'll be right back today after gtore tayweo bakod closes in five. we jed to grab a few more gifts. —jackpot. —that's the one. yes! okay. let's go. j.j. watt! hey! i made my family disappear. ♪♪ happy holidays! i can't put my arms down! jj! sorry, guys. i was just in there having the best night of my life. oh. what's this? it's a beaut', jage. it's a beaut'. get in the car, boys!

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guidance came in weaker than expected the company said the consumer oriented markets will be weaker. will expect returns to increase in the following quarter. and jeff bezos at mar-a-lago meeting with the president-elect for dinner . at deal book conference, bezos talked about trump's second er as president. >> i'm very hopeful about his -- he seems to have a lot of energy around reducing regulation my point of view, if i can help him do that, i'm going to help him. >> later this morning, we will speak with yale's jeff sonnenfeld about the relationship with trump and

ceos. in the meantime, thousands of amazon workers are striking this morning demonstrations held in new york, california and illinois and atlanta. union officials say the retailer failed to come to the bargaining table to negotiate contracts while the strike will be a challenge to amazon's holiday fulfillment push, unions compromise 1% of the work force. the company says it does not expect any impact on operations. when we come back, a lot more on "squawk box. lawmakers have less than 48 hours to reach a deal to come to a deal an d avoid a shutdown as we head to break, a look at the winners and losers more losers after what took place. we'll be back after this

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good morning welcome back to "squawk box. we're live at the nasdaq market site in times square if you are just waking up, you will see the selloff there are glean reen arrows, but modest with the declines yesterday. dow was down more than 1,100 points yesterday it is back up under 70 points this morning s&p futures up 11. nasdaq up 36 points. the nasdaq off 3.5% yesterday. the dow was down 2.5%. you had the s&p down 3%. we'll continue to watch this through the case of the morning. dow has now been down ten days in a row that's the longest losing streak we've seen since 1974. again, you are also talking about the s&p down 3.7% from its all-time high. lawmakers scrambling now to put together a spending agreement and try to avoid a

shutdown after president-elect trump and elon musk scuttling the spending bill. we have emily wilkins in washington with the latest all night. where are we here? >> reporter: andrew, we are not close to a solution here republican lawmakers still haven't found plan b to keep the government from shutting down on friday night trump's opposition to the bill after elon musk tweeted all day and threatened lawmakers he will oust any who supported the bipartisan stopgap we saw trump, not to mention lawmakers from states devastated by hurricanes, come out and say billions are needed for disaster relief as well as assist answer for farmers. to further complicate, trump is calling for lawmakers to look to

debt limits. to bring the mess of the debt limit into the trump administration rather than allowing it to take place in the biden administration, any republican would be so stupid to do this should and will be primar primaried. of course, in the past, negotiating the debt limit has taken months and lawmakers are tying trying to find a solution before midnight on friday and key government services could shutdown or not be as productive and efficient as they normally are. >> so, what do you think this really spells for the house speaker in terms of his job? if not him, who? >> reporter: those are two really good questions, andrew. this doesn't look good at all. johnson contracted the bipartisan solution. he talked about musk he was at a football game with

trump and the package he put out and the republicans in the house didn't like it republicans in the senate didn't like it. elon musk hated it and donald trump killed it within less than a day. this doesn't look good for him and doesn't look good for his leadership lots of concerns about the process. remember, he only has a three-vote majority. we could absolutely see a scenario like we saw with kevin mccarthy where there were multiple unds of johnson to become speaker and he would make concessions. it is not clear who else might come up with johnson doesn't there is till steve scalise an jim jordan and some interested in running at this point, everyone is focused how to keep the government from shutting down on friday and whether we are going to see a prolonged shutdown that could go to the start of the trump administration >> emily, i think a big part of this is testing how much control

president-elect trump is going to have over that republican caucus there's basically no room for error with the number of votes they have. he's not going to get any democratic votes on this they've gone hostile already there is not a crossover like speaker johnson was putting together he is holding them the threat of elon musk come after you on x is one thing. the second is president-elect trump saying he will primary you if you don't vote for what he wants. that bill that he wants doesn't exist yet. that is up to mike johnson to put that together. this is a true test. i guess we'll see how effective doge will be this is the first test of that >> reporter: there are so many moving parts here, becky you hit on all of them it is going to be a big test also remember, democrats still control the senate

whatever the house passes, even if donald trump can get all of the republicans to get on board and stay on board with a piece of legislation, i'm not sure what piece of legislation that would be this is a bill that chuck schumer can take up in the senate and democrats can support as well. that's why johnson put out this big bipartisan package because it had enough of agreement and could get through both chambers. now with talking about raising the debt ceiling or an illuminan the provisions republicans want to see, it raises questions now and the question of the next congress do you see members who have been deficit hawks and anti-spending, do you see them soften and ease up if donald trump puts the pressure on them is trump willing to put pressure on those who have been loyal to him in the past? what we are seeing right now, we could easily see this play out multiple times in the next two years. >> biden's still president

if you are going to shut the government down -- >> i don't think biden cares >> yeah, but if trump would rather shut it down now -- that's a danger of -- just like he wants to raise the debt ceiling now so it's not january 20th if there is a government shutdown to finally -- a lot of republicans that are on that, you know, on that far right that think a government shutdown is the last thing that will -- >> the problem is if you have a republican -- republicans in the house whose districts are hurt badly by doing this, it doesn't matter they will get ied by their constituents >> and mitch mcconnell's warning shutdowns hurt republicans there is the concern they are the ones holding the bag.

>> it is difficult for donald trump to take control. >> the election's over. >> he's president-elect. >> there's one in two years. that's a long way. >> emily, thank you. nice to see you. i'm sure we will talk to you a lot over the next 24-to-48 hours. >> four years. coming up, we will dig into yesterday's market selloff katie stockton joins us to talk tech next. as we head to break, check out the yield now on the ten-year almost at a new high for the year up over 4.5% "squawk box" will be right back. >> announcer: currency check is sponsored by interactive brokers. the best informed investors choose interactive brokers

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session. the tens the tenth straight losing session. joining us is katie stockton it's more conventionally used my technicians to decide what the market is going to do. we had an ex-haustion of selling yesterday. a snap back is expected. we could head back into testing the support levels >> this comes at a pretty interesting time seasonally. usually we have the santa claus rally the last five days of the year and first few days an typically. with a snapback, it could last year end and slightly beyond that if we don't recover dramatically

between now and friday's close, just two days, we will see sell signals in the intermediate term momentum gauge is on a sell signal right now if we don't have a good, good recovery, not enough this morning in the futures >> it's not much what would it take in the futures for you to say, okay, this is a strong enough bounce back it could breakthrough what happened yesterday >> i would say at least 50 or probably more points than that it's possible. we saw what the market did yesterday down about 3% for the s&p 500. in terms of levels, on a day like yesterday with the vix spike, the levels won't matter much intraday. we watch them on a closing basis. if you see the s&p 500 take out support, the 200-day is 6% below. that's not a major level for it.

the more major support is really 8% to 9% below i would not rule out a correction of that in q1 we don't think we will see that level of immediate downside follow through which is a bit of a gift, potentially, for the market so people have an opportunity to reduce exposure ahead of that. >> when you sat down, you said things are getting interesting that's a confusion way of looking at things. >> i'm a technical analyst volatility stirs things up in had reality, when you see a sharp decline like yesterday, it is more reality counter trade move what would be worse for the market if we see a slow grind lower. that would be the start of something that is worse. >> that's what you said. we already have seen a slow grind. is the vix ever useful in predictive i think i would buy and hold on until something like this

happens and sell it. >> i don't think the vix is great as an investment or hedging tool >> only in hindsight. >> no, in real-time. >> the vix spike and now it's come back down that told us nothing. >> vix spikes don't last long as you know a week or so that spike has worked itself off. >> get rid of it >> if you lay the market indicators over the vix, it can be informational >> tell me about the ten-year. it has gone to four. >> it did. it has taken the line back to 2023 that was our year-long cyclical down move which is reversing if you see them hold around 4.36, that trend will be reversed and suggest the secular up trend we think is now in place has resumed. >> to 5% >> 5% would be basically the first major resistance 5% to 5.25%. that seems very realistic for

next year regardless if this is the breakout or not. >> where do you land on the bitcoin? >> positive momentum, intermediate term, long term we believe bitcoin is right for a percentage of portfolios we believe there is a better entry. looking for more consolidation as it tends to step higher we think it's on a stair right now. you know -- >> you say there's a better entry. a lower price point? >> probably a lower price point consolidation. >> what does the floor look like to you >> 70s. >> high 70s support. it doesn't mean it has to go back there support doesn't act as a magnet. it's a potential area of buying pressure >> somewhere i saw will it hit $1 million in 2025 or 2026 i saw an article written that's where we are in terms of -- i don't know.

>> i read that article last year before that. >> it's on the way it wasn't at $102,000 then $1 million by next year. >> that's aggressive think of it -- >> or 2026. >> it is exemplary of the risk appetite it would be hard to imagine an environment in which the s&p is pulling back 5% to 10% and bitcoin is immune to that. we did see a pullback yesterday. >> did you bet on the banana tape on the wall >> no. >> the guy ate it. someone pointed that out the other day. we're in restrictive territory people are buying bananas for $1 million. >> things are getting more interesting. >> the certificate of authenticity >> you can slap another banana up >> you might be able to change the duct tape if it stopped being sticky >> good to see you.

>> good to see you, too. >> happy holidays. when we come back, a new warning from the faa about drones in new jersey it's not exactly what you might think. we will explain right after this still ahead this had morning, we will talk to congressman pete sessions, he is the cochair of the doge caucus we will talk averting the shutdown something looking less and less likely "squawk box" is coming right back is a bitcoin etf the same as owning bitcoin directly? while bitcoin etfs might offer

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the faa is warning people not to point lasers at aircraft. the drone sighting in new jersey

prompted 269% of laser reports by ilots aiming a laser at an aircraft is a violation of u.s. law. the fbi warned people this week not to shoot at suspected drones or point lasers at them because manned aircraft could be mistaken this is a big issue. don't point at it. don't shoot at it. a big problem for people in the skies. coming up after this, stocks looking to bounce back this morning from yesterday's selloff. we look at the biggest dow gainers in the pre-market. amazon, nvidia, goldman sachs and american express are all up, but they have all been down yesterday. we'll dig into all of that and dig into a hot market for investors dollars right now. that is college sports we'll talk about that and so much more after this

welcome back to "squawk box. wall street could set sights on the new trade in 2025. that is college sports listen this to comment from mark lasry and former coowner of the nba's milwaukee bucks. >> i think it is a phenomenal opportunity. i think you will see a number of schools selling their teams and the reason for that -- >> to whom >> to folks like us. we're bidding on a couple of teams, i can't tell you, but in

essence, we buy 51% of the team. >> cnbc sport hears you this morning in conjunction with athletic director out with the list of 75 most valuable college athletic programs. ohio state list of the 75 most valuable college athletic programs at number one, ohio state valued at $1.32 billion followed by the university of texas, texas a&m, michigan, and alabama. joining us right now with more on this, the man behind that list, cnbc's valuation guru. good morning to you. >> good morning. >> i can't believe we're even talking about this this was on the bingo card, but it was on his bingo card where are we here? and how do we really know how much these teams are worth >> well, the people i spoke to, the people that are looking at investing into these ograms, pro sport teams, typically five to ten times revenue

the teams -- the schools need this money settling past litigation they're on the hook for $2.8 billion for the power five schools and going forward, we're seeing these athletes make money from name, image, and likeness we just saw that quarterback in high school decide to switch from lsu to michigan because they're guaranteeing him $10 million in nil money. >> and tom brady was calling him constantly it's nice to have tom brady on speed dial. >> and that counts for 75% of an athletic program's revenue. >> and the universities would sell 51% so they would actually not effectively own them in name or are they going to sell minority interests >> i think there are two main types of proposals one is sort of for a superleague or superconference where private equity would come in and own a piece of that. the other is for specific schools, but i don't see selling a football team or a basketball team i see the athletic program being sold >> let me ask you a different question >> it's so weird i can't get my head around this.

>> historically, you know, if you owned a professional baseball team, basketball team, nfl team, that was like owning a piece of art, and part of it was the cash flows, but part of it was that the valuation of the team would continue to go up and eventually you would be able to sell it at a premium to some other group of people. if these athletic programs are always going to be tied, i would imagine, or at least hopefully to the university, right can they be treated in the same way and can the valuations ever really be even close to the same because you can run them for cash and dividends back out, right? but the idea that you could ever then sell it to somebody else and that it's like a piece of art or it's like this sort of unique collectible that doesn't exist anywhere else. >> that's why one of the things they're thinking of doing is taking the revenue generating properties, whether it be media, licensing, sponsorship, merchandise, putting it into what they're calling a special purpose vehicle. >> right >> which technically sits outside of the university. >> that's back

>> something like that so that particular asset can exchange hands you can buy and sell pieces of it, and that's the way to get through some of these other issues that haven't been resolved these schools are nonprofits this is going to be a profit. >> here's what bothers me. as a college sports fan trying to figure out private equity coming into this, is private equity going to be spending money to invest on these teams and to get more out of it, or is it going to be stealing from the school, future revenues and things that were all built up that were supposed to be going back into academics? for years and years, these college football programs have been supported by the university with the idea that if you build this, it's going to be better news for the academic side of the equation on things, that you will have alumni who are more willing to give back to the school is it robbing that entire agreement of what was supposed to be there? these are just professional sports teams at this point >> right >> so you and i were talking about it before the break. this is the gradual thing that we've seen for more than a

decade where they've just become professional sports teams, but always the argument has been at the university level, why should we invest in these and the argument back has always been, you do it because it builds for the university's strength and the academic investing we can do down the road if you are now selling it to private equity at a majority stake, 51%, and you will no longer be the controlling partner in any of this, how in the world can you say that everything you've ever spent has been for the good of the academic side of things? >> the flip side of that argument, and i don't disagree with anything you said, is that if you put private equity money in here, these schools are not expert at monetizing their assets, you know they're administrators so on the one hand, you're going to have private equity coming in and figuring out -- >> that's an argument for minority stake, not a majority stake. >> and that revenue will then be used -- i also don't think the argument for majority stake is what's going to happen at first. i disagree -- >> was that mark just become wishful thinking >> i have not heard that as

being the main way this is going to work. >> to me, that sounded ridiculous. >> i think it's going to be a minority stake of this special purpose vehicle. the interest will then be you'll get more people that will donate money to the school from donors. you'll generate more revenue from that special purpose vehicle, but to your point, let's be frank since football and to a lesser degree, basketball drives the revenue, what about the other sports at the university and that's where i buy into what you're saying, is there could be an issue with, what about title ix, women's sports and things like that? >> the school is on the hook. >> we appreciate it. it's just past 7:00 on the east coast here. you're watching "squawk box" right here on cnbc i'm andrew ros sorkin along with joe cernan and becky quick we had a wild day yesterday after what was a genuine selloff this morning a bit of a bounceback. we'll see how much of one we'll really get here. dow up about 105 points, the

nasdaq, up 69 points treasury yields, take a look at this you're looking at the ten-year notes sitting at just about 4.530%, and then check out the british pound because the bank of america just -- bank of england i should say, announced it's holding interest rates steady that was expected. the vote was not unanimous three voted for a quarter-point cut. steve liesman is here at the table after what was a busy one for you. >> it was an interesting day not a good day, obviously. did you want to read the intro, becky or do you want me just to ad lib myself? >> let's get to the debate of the day, what the fed said, and why it spooked the market so much we have had some conversations around this already this morning, steve, but what jay powell said probably didn't come to a shock for anybody who was following the fed closely, but for some reason, it came as a

surprise. >> we talked about the idea of a hawkish pause, and i said yesterday it wasn't ready for the hawkish pause and it was debating whether the cut was dovish we're going to debate today what the fed said, and why it spooked the markets, maybe more important was the market just a knee-jerk reaction or were equities and bonds settling in the fed cutting rates as expected 95% probability in the futures market quarter point down to 4.25% to 4.5%, but raised doubts about how many more cuts are actually coming >> i think from this point forward, you know, it's appropriate to move cautiously and look for progress on inflation. >> okay. so here's the things that were different, maybe forecast only two cuts next year which is whae t we said, but not three as the market assumed. there was one dissent, but three others who didn't have a vote wanted no rate cut so there was a bit more dissent

than it appeared there were four banks that didn't ask for a discount rate cut. that could show what the board of directors of those banks or the president him or herself wanted and of course, raising the inflation outlook for '24, '25, and '26, and inflation policies began to begin this process of building in, folding in, and incorporating fiscal policy changes, and it might explain why those inflation forecasts went up for 2025, with specific concern about tariffs, fed chair powell saying, they introduced uncertainty into the outlet, but not necessarily inflation per se markets don't believe the fed is even going to cut twice. you have the probabilities now 9% for january we're going to take the month of january off. march, we got to be -- we'll watch, but it's 49%. it's not until may that you have that first cut next year and you have to go all the way to december and there's still only a 44% probability of a second cut showing the market is not really pricing it in

you can see that better when you look at how the december 25 funds contract is trading. 3.95, it shows little conviction of a second cut that would bring the rate down below 4% situation could change with better inflation numbers, new unemployment data, more rity on what the president-elect plans to do with tariffs, but right now we're sitting in this zone and the market has to process the idea that there will be less of that coming next year. >> roger ferguson was on with us earlier this morning, the former federal reserve vice chair and he said just that, that maybe two cuts are not in the offing he wouldn't bet money on that at this point the further out you get on the dot plot, the less reliable it probably is too. >> even near-term it can be unreliable as well >> i like this from noah black trying to get him on today, but messaged me yesterday. he's from the great state of canada, 51st state he said, i'm having a hard time with powell seeing how there

wasn't politics involved for a fed that never uttered a word on the ira, all the additional stimulus, or the green new deal, he decides ahead of trump even being inaugurated, he decides to talk tariffs no problem with any of the other crap decides to talk -- well, those tariffs could be a problem >> talk to noah or talk to you >> i don't care. i didn't say anything because i know you'll defend, you know, this. >> there was a pandemic and the fed does raise rates during president biden's term >> staying -- did you criticize when they were staying at zero >> sure, i did >> okay. i think it's hard -- >> let's not make this personal. >> i think it's hard to criticize the fed near-term. >> near-term >> yeah. while it's happening, i think it's hard to point out -- i think it's hard to point out policy mistakes. >> we have 3.2% gdp growth we have 4.2% unemployment.

we didn't have a recession are you so angry about that? >> i'm not angry i'm not ang ry at all. we need to be -- while it's happening, we need to be aware there could be mistakes. >> i agree i was looking back, joe. there are march forecast was for inflation to be 2.4% on the headline and 2.6% on the core. they've moved it to 2.8% do you want to hang him for 4.2% >> one of the things he has said as it relates to tariffs was he said, look you can't really build into your plans -- >> he said that yesterday too. >> he read from his 2018 fed document the question is -- >> no idea what he said, basically. >> but the question -- it was acknowledging that the tariffs -- what you were trying to suggest. >> that's what i was trying to say, yes >> i had two questions for powell yesterday >> trump on the mind >> the one i asked was, are we done with recalibration? the other thing i would have said is, what did you learn from

2020 and '21 and '22 about reacting to fiscal policy? should you be reacting sooner? and i think that's a discussion -- i think he feels and maybe he's acknowledged that he acted a little too late, joe, and i think there were reasons why they acted too late. for example, in the fall of 2021 when they pivoted, they didn't pivot with rates and the balance sheet because we were facing another wave of the pandemic okay now they eventually pivot in the spring and actually change policy in '22. they could have gone earlier how much earlier is unclear. what chris said this morning was he was surprised how early they seemed to be incorporating potential changes from the trump administration and fiscal policy. i don't know if that's political, joe, or that's prudent, or that's what you call -- >> taking -- let's say just take the tariffs or what happens with

policies in the new administration off the table completely let's say instead of cuts next year we end up taking back the 100 basis points -- >> let's say we do. >> if that happens, that wasn't being called >> do you want the fed right now to position policy for what might come from the trump administration >> no. i'm saying take that out completely they may already be behind the curve on inflation and have declared victory too soon. >> 0.2% above where you thought you were going to be. >> for now looking at -- the markets aren't acting like they were in restrictive territory until yesterday. the markets were acting -- >> there are parts of the economy that are >> bananas, on walls, all those things. >> you talked about brian moynihan telling becky that small business is taking it on the chin now that was something -- >> now you're talking stagflation which you never want to utter either. >> the reason i don't talk stagflation is because in a normal economy, prices react to

demand, right? if you do have this decline in -- >> but we can have both. >> you can have both it is a rare situation i think we have had maybe it once >> it's the worst. >> why would you make it your base forecast? >> i'm not making a base forecast i'm saying we could have -- we could be failing on both mandates

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joining us now with the latest on the government funding battle, congressman pete sessions of texas. he is cochair of the house doge caucus thank you for joining us and being -- and welcome it's good to see you, mr. chairman >> good morning. i guess if -- >> good morning. >> it's a delight to be with you. >> it's good to have you on as well if you have an empathy for what doge is going to try to do, i

can imagine maybe you thought there's a little too much pork in the deal that speaker johnson had put together >> well, without a doubt the american public jumped in as well as president trump. if you are going to be successful at these year-end deals, they need to be very refined and simple winners do things to win, and part of that winning equation is do what you have to do to get across the goal line we are in a very interesting time where it's not only close, but speaker johnson had little room to pivot, and evidently he pivoted with an agreement that was bipartisan, and what that turned into was a fight that then not just our own party. as the co-chairman of doge, we want to make every single item stand on its own we are not nterested in puttin them into a large package.

we are not interested in adding to that deliverance right now, and that's what the feeling was that came across as the speaker johnson added things that were extraneous to simply funding the government >> and i guess that winning is different things to different people averting a utdown is probably in the speaker's eyes what he was trying to do in terms of winning. so in his view, that was the way to go about this what do you think we should do as an alternative to make ure that we do get something accomplished if we have no support or backing from the other side >> it will require us to make it simply what is commonly called a clean cr a clean cr runs the government it does the essentials and basics yes, there are some things that need to be added we need to be prepared for the inaugural.

we need to probably be prepared, and this is a point that perhaps president trump made, of doing something about the debt limit the debt limit is going to require every single republican to vote for it to pass it. so what we're doing is putting together the package that can pass now next year is not necessarily going to be any easier so we might as well work as a team and take out the things which cause division and for it to appear to the american people that we are ing in what we do. we must bring stability. we must bring certainty, and that's part of what doge is about in working next year with the president and his administration things will be highlighted we will have a discussion with the american people, and then we'll have an up or down vote on each of those individual items i think that speaker johnson certainly in the package brought in many things that were

extraneous to that, and that caused the downfall. >> chairman sessions, at this point, the republicans don't control the senate so even if something passes through the house, you still have to go through a democratically controlled senate how do do you that or do you figure that this is going to be pressure and you figure, if you pass it in the house, then it's going to be the democrats who own the shutting down the government until the inauguration >> well, i think if you follow what i think needs to be done, it's a skinny, must-do bill where you fund the government. you become prepared for what would be the inauguration. you thank your members you send a clean cr directly across the hall. they see it for what it is they too i'm sure see a responsibility of stability as we to do the name of the game is to pass the bill, and then deal with the

president and the new things that have been next year, but you're exactly correct evidently the speaker brought that equation into it that he was trying to -- to pass a partially senate bill. we really within the do that in the house. we never have. we don't pass necessarily bipartisan end-of-year deals you pass what you can pass, then give it to the other body or section 7 gives us that authority and responsibility >> so let's say they don't -- they don't take you up on it and the government shuts down. who's going to be blamed >> well, let's get away from blame and go to what you can pass >> it's politics >> we'll both be blamed. okay i have been in politics a long time, and we have a responsibility to pass our bill, and a clean cr is one that the american people would understand and could sustain, and a clean cr would be something that even

chuck schumer would understand let them put the things that they would need in the bill, and then let's get together very quickly and compromise, but we have to pass our bill. that's a responsibility that the house of representatives has >> do you think it's going to be easier to get everybody on board with the president-elect, you know, breathing down their backs so to speak? >> what i do think is next year, we had the authority and responsibility by being in the majority that we have to pass that, and that does include a debt limit which is perhaps the hardest next to a budget, the hardest vote that's ever taken in washington, d.c., and we agreed to take the ball where it landed, on the course, and we agreed to make it better our point about doge is, is that it brings in the realistic viewpoint that we've got to do two things number one, make the government

work more effectively. the president has never been -- we've never had a person more prepared to be president, and some could argue jefferson, maybe washington, but i think donald trump has his hand on what it's going to take to give stability and bring the american people and government back in line with expectations of people and the cost element this government costs too much money. we have government workers sitting at home. a huge number of government workers still at home, and government is not working so doge is government efficiency. we will then gather together certainly with the outside titans that have a say in this, and we're going to run it through the american people and then hope that we can reduce the cost of government while we make it efficient so no. it's not going to get easier next year every single republican, no matter which

body, is going to have to be on board. >> you're really good at social media. i said, what a great -- you put out a shot of you getting -- you called yourself an early riser it's 7:30. we have been -- i think i got up four hours ago, mr. chairman so -- >> you made a mistake and picked on a guy that did a paper route in the morning fourth grade, fifth grade, sixth grade. i'm also an eagle scout. i don't mind getting up early and getting the eggs ready these are characteristics. >> i'm retweeting your tweet and thank you for doing that, and helping the cause. helping the cause. good to have you on. it's a good shot >> stability -- stability for the entire country you see you get up every day and give us the viewpoint on the stability of marketplace we need that too, and i want to congratulate you we need to be a part of understanding it, and that's where donald trump is also expect success this next year.

>> all right, chairman sessions. thank you. retweeting this right now. you're going to get a lot of followers. that's all -- that's all i'm telling you. thank you. coming up next, reaction to yesterday's fed decision market selloff and all that straight ahead don't go anywhere. "squawk" returning after this. >> announcer: time for the aflac trivia question. on this day, which holiday classic was published? the answer when "squawk box" returns. aflac can help attract and retain that top talent. you know we like that top talent. and listen, i mean you gotta listen. aflac gives employees cash to help with unexpected medical bills. it's prime time to add aflac. request a call today at aflac.com/prime

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>> announcer: and now the answer to today's aflac via question on this day, which holiday classic was published? the answer "a christmas carol" by charles dickens in 1843 all right. stocks sold off sharply yesterday after the fed announced a 25-basis point cut, but more importantly, signaled a slowdown in the rate -- the pace of rate cuts for the rest of the year, and next year as well. joining us right now is j.j. kinihan. he's the ceo of ig north america, and j.j., explain the market's reaction. i don't think it was in telegraph that this would be a cut, but a hawkish cut, but what did the market hear that it

didn't like? >> i always compare the market to a spoiled child when it comes to rate cuts and that is no matter how much they get, they want a lot more, and so again, but the major thing moving from four projected cuts down to two projected cuts, you know, the market loves freer money, and so with that, the possibility of investing, i think really where it starts to come, is on those stocks that may not be the ones that have -- that normally people invest in, the magnificent seven, some of the top stocks, but the next layer people just aren't going to be as willing to take chances on that because the money isn't as free, and those companies may not be able to get some of the government contracts, some of the loans or whatever it maybe that they were getting before. so with that, you've seen the dow obviously for the last nine days have a tough time, and yesterday really was a bit of a selloff of all assets quite

honestly, and i think the really interesting thing around it, becky becky, is that as we come to the end of the year, are many people going to say, i have had a pretty good years, i'm going to take profits or, you know, to look at the reaction this morning is encouraging in terms of the s&p's bouncing back in the premarket, but the one thing i would warn your viewers is this is a triple witching week. so with that normally -- >> that's tomorrow >> tomorrow, exactly, and today could be another volatile day actually, and tomorrow, particularly the opens and the closes as people unwind their stocks versus options versus futures so there's probably still a bit more to go because big moves like yesterday throw off some of those trades people were planning on making. >> you pointed out a lot of really good things we want to pay attention to first you pointed out this is really bad news for smaller businesses i'm glad you did that because we haven't really talked about it today. let's bring up the russell

2,000. you saw 11 points knocked off the dow, but that was the best performer. the dow was down by 2.5% the nasdaq was down by 3.5%, but the russell 2,000 was down by 4.4% yesterday so that really focuses your point on how this is bad news for companies that are not the biggest of the big, that they're going to be the ones who struggle trying to get access to loans and to money steve liesman pointed out that brian moynihan hold us on the show earlier this week, small businesses are the ones they're most worried about the russell 2,000 is down by 5.5% that's a big knock on all of those issues we did have a technician on earlier this morning who said, this is not much to write home about. she wanted to see at least 50 points of a rebound or more from the s&p 500 to really say that you're going to get through some of the technical concerns, and your idea about what happens

tomorrow with triple witching, you're right i didn't realize that, j.j that is something to watch out for. what will you be watching just in terms of reaction over the next two days of trading before you really kind of get your feelings about how things are working out here >> well, i think a couple of things to keep in mind number one, do we hold this gain in the futures after everything else opens how many times, becky, have we seen in our careers, you know, that things look great in the premarket, et cetera, and then within the first half hour, we're back down? that first half hour of trading today becomes incredibly important to me, in terms of can we hold it because you'll see i think oversized volume on the open today, and sized volume on the close tomorrow because of tripling witching and people doing that, and i would expect to see volatility right out of the gate today in terms of a bigger, you know, move one way or the other, you know, not just like five points, et cetera, but maybe 20, 25 points pretty quickly in that first half hour. i think that's really going to

give us a good sense of the day. then we've got of course, midday, you get pressure at the end of the day those are key times throughout the end of the day, and i also see spike 40% yesterday, and down 34% in the market do people continue to buy options for protection and roll those out in the future? the last thing that will be interesting maybe not today and tomorrow, but plays into next week, is, is there going to be pressure let's look at this you look at the indices, and you pulled great stats on what's happening the last couple of days or the last week. it's been a pretty good year for most people who have been invested all year long do people just start taking some profits or, you know, like our clients yesterday, nvidia, spotify. spotify was as heavy as i've ever seen. more than 90% of transactions there. are people saying good companies? i'm using this as n opportunit

to really buy them is this a buying opportunity or take my ball and go home for many people? >> j.j., thank you happy holidays. >> happy holidays, beck. thank you. >> see you. we'll have much more on the markets in just a bit. market historian and wharton professor, jeremy siegel will be our guest. plus, later former fed vice chair riarchd clarida is going to join us "squawk box" will be right back. (♪♪)

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welcome back to "squawk box. business leaders meeting with president-elect trump this week in mar-a-lago includes the ceot, and then last night, jeff bezos. joining us now is jeffrey sonnenfeld, the senior associate dean for leadership studies and also a cnbc contributor after put together a tour deforce of conference yesterday that had tim cook to marc benioff to so many others. how many people? >> 200 it was our 150th ceo summit since actually we launched the concept. as obvious as it was to create a

school for the boss, nobody had done this before forbes fortunate business week, it was started years later so we were the first, and we're truly the only noncommercial educational event. >> i was there for part of it. tell me what you think was the biggest surprise for you >> one of them was that they showed up. a number of their boards told them, this is really dangerous ceos are being targeted. you're on playing cards. you're on posters, wanted posters. >> clearly by the way, across the street from where brian thompson was shot, physically, literally. >> that is absolutely true i accidentally lied to them. i told them we were 50 paces away from this the murder took place. it turns out we were as mayor adams showed us, we were actually closer than that. >> mayor adams was that. >> he was there. there was a statement of defiance that they were there. they made a strong statement several of them changed board meetings the american airlines ceo left his board meeting to make that statement, that they were not

going to be frightened away or intimidated by standing up for leadership and american character, and not sort of the endorsements of this populist fringe. >> have they changed their behavior, their security >> they've dramatically ramped up -- it's shocking these people, only had 20% of them had personal security. i would have thought it was much higher myself, and m ure you guys never get any hate mail, but i'm flooded, depending on what kind of mud wrestling situation i get in with joe. i hear it sometimes more from the right, and i'm hearing it more from the left these days coming after me. i'm doing something right. you feel the same way if you get criticized by both, but the threats, the death threats of open postings asking for my assassination, and this is just me ceos are getting -- three of us with us yesterday were wearing bullet proof vests

they wear those when they internationally. we were sitting in a ballroom. >> i want to ask you, you do polls throughout the day, which are ing because you effectively anonymously poll these ceos about their perspectives on things like taxes, on things like tariffs. you had a fascinating poll that you did on the nomination of rfk jr., for example, and whether he's a threat to public health which the ceo said he was. what were the most interesting findings of those polls to you >> i'm glad you caught that one. the overall theme was the roaring '20s lessons from the 1920s, late 1920s for the late 2020s and it's a -- it seems like an obvious theme. i'm surprised nobody's gone for that before, and there were many ways we felt we were better off than we were then. income disparity was much worse then than it is now believe it or not, despite the hand wringing of many of the populists on this theme, but

they were mixed on a lot of issues in trumpenomics they were favorable in using tariffs as a bargaining cajole rfk, i was surprised including somebody who met with him recently walked away confused. 65% thought he's a threat to public health. i think the idea of the tax cuts for domestic manufacturing, they were in favor of it. they thought that, you know, even though some were skeptical as to whether or not the entire supply chain has to be domestic from 22% to 15%. they thought this could stimulate domestic investment. >> what do you think of cryptocurrencies, unsupported by any underlying intrinsic value this was of the 200 ceos 84% effectively said that they believed that they were unsupported by any underlying founding i thought that was shocking.

>> i thought it was shocking i had a series of questions that i didn't have to do because when i asked them, as you know, we had the largest crypto exchange ceo there in the room, and several others, you know, anthony scaramucci, and all these others is i asked, how many of them are using crypto for any daily transactions 100% of them said zero i said, have you ever? 100% of them said zero i said, let's skip the frequency questions. i said, a meme stock most of them said yes. >> what do you make of all the trips that we were just talking about jeff bezos being in mar-a-lago, and we talked about the number of ceos that have made their way down there. what do you make of those trips? how different is that historically, or is it >> it's -- that's a really great question in 2016, the -- the strong gop

support that always came for the business community came to a halt we've studied going back just to fortune 100. not fortune 500, but roughly half of them, you know, going back to abraham lincoln, whether it was taft or reagan or ford or unsuccessful candidates like mccain, mitt romney. they always said about half the u.s. business community or major companies were out vocally working hard on the campaigns and hit a wall in 2016 it went to zero. there were two in 2020, and this time until the horrific assassination attempt that brought elon musk out on president trump's life, there became one, and that was -- that's quite a change. however, every other time, especially in 2017, i brought president trump -- then he wasn't president, into one of our ceo forums before he won, and the major ceos, many of whom are still in office now said if he walks into the room, we're walking out. he walked in, and they walked

out. they headed over to trump tower, and he told me we're all coming by here now because they did come by in early 2017 because -- the same reason they're rallying now is regardless of how they felt on the campaign, there are american ceos that are very patriotic and they know it's in the nation's interest and the interest and their stakeholders and share holders that this be a successful president they want trump to succeed and they want to talk with him a few of the ceos who didn't want to go down to mar-a-lago i was surprised are saying they're supportive of those who did even though they wouldn't i thought it was hypocritical to criticize them >> why do you think so many ceos are out of touch with their customers and the american public to where you lose both houses, you win the popular vote, you win all seven swing states you've got these ceos who say, i'm looking at a previous time here on cnbc where you said there's zero support this was just a month ago. zero support for trump with the

ceos >> the major ceos. >> is it that out of touch with the american public for him to win 312 electoral votes or maybe you misinterpreted what they're saying >> joe, i congratulate him i congratulated him directly >> that's not what i was asking. were they that out of touch with the american public, these ceos or they're so different -- so virtous that they could see how bad a guy trump was, but the rest of the american public could not? >> what you have is -- it was a clear sweeping victory not a landslide, a sweeping victory. we're talking about a percent to 1.5% that was the swing vote in those swing states, and it was very close in each of these elections, but it was a decisive win because it was across all those categories. >> without exception, ceos were against trump and now they're only with him because he won you don't think any of them secretly really want him to win for corporate tax rates?

they love that there's not going to be as much regulation they love -- >> they're not investing differently as a matter of fact. >> they liked kamala's policies? >> nobody in the room thinks they're going to benefit because if the tax rates unfurl the way they're talking about now about domestic supply -- >> they were willing to accept all of kamala's shortcomings just because trump was a bad -- had bad character quality? >> they believed as even steve moore from the heritage foundation agreed on the advisers yesterday, that this is perhaps the best economy in american history, and a gilded economy is being handed to president trump. nobody disputed that the fact that, you know, there are, you know, some creeping inflation issues coming back and you're talking about it earlier with steve and the feds, that's a concern. but what we have is we -- the deficit was cut by two-thirds. it tripled under trump we have the lowest unemployment

since this >> from the pandemic levels, where the deficit is still double what it was pre-pandemic. it hasn't been cut >> it was cut by two-thirds. >> from the pandemic under trump. that's -- >> under trump but the is it's a great economy. >> it's $2 trillion now. >> unemployment hasn't been this low since you and i were watching -- >> none of this has to do with the appointment i point i was m >> let's face it though. >> would you say there are a lot of ceos excited about the prospect for the deregulation for doge >> all of those things, but they're probably also nervous about getting targeted on x if they do something he doesn't like. >> it happened >> i think that whole narrative was false. >> you don't like the chair and you've featured him well, and harley davidson, he was trying to stay out of politics, and the

retaliatory trade barriers that he got, harley davidson was 100 % made at the time in the u.s. he couldn't ship bikes into europe because of the retaliation in europe against the trade tariffs -- the trump trade tariffs and he had to shut down a plant in kansas city and open up in thailand. what did trump do? say, don't buy harley. it's the american eagle. >> there were chains and guys like musk, and there was ackman. it was across the board and i think you missed that trend beforehand >> you have the wilting effect of the sleeper effect. >> that might have been a shocker for you. >> no. we always thought it was going to be close. nobody said -- >> it wasn't that close. >> it was 1.5% -- >> it was very close. >> he won michigan, wisconsin, the popular vote. >> i understand these things, but it was one 1.5%. the bigger issue i wanted to raise was this issue around

mar-a-lago most of the ceos who are going down there are saying to themselves, you know what? a, i'm not going to worry until i have to worry, and b, i want to try to support the country, and c, there is no downside in me trying to create a relationship now given the situation. >> my point is -- >> hoping that maybe it helps later down the road when tariffs do come, and maybe they want to get a carveout or whatnot. that's what's going on here. >> they have company-specific issues for their shareholders and they want a lobby of big pharma companies trying to bring superstitionality. they're atriotic and they want to support president trump. >> in terms of policies, it wasn't even close for a business owner for who you would want to win. that's my point. you can do the character issue and the rape, insurrection, all the -- january 6th you can do all that, but trump's

policies for business, you can make a case. >> they believe in the independence of the fed. >> once again, you miss the mood of the entire american populous. >> but joe, the idea that you miss the mood of the entire american populous, that is actually inaccurate. >> you were on the wrong side of that >> because it was -- half the country, and 1.5% distinction. >> in down ballots, and swing states >> the straight popular vote the first republican to win the popular vote since bush. >> the situation is the elites jeff is talking to the elites. >> i think a lot of ceos are very happy with the outcome. >> the democrats beat out the republicans overwhelming in down ballots and at the state level there are wins and losses and the important thing is the ceos are not being paradoxical. they're being patriotic and i salute them for trying to help make the trump presidency a successful one too that's the -- >> okay. >> that is their goal. that's the national agenda right now, is how can trump -- president trump succeed, and how can the ceo of business

community help it's a win-win for shareholders? >> jeff sonnenfeld, thank you. we have a lot more coming up on "squawk" after this i need to get me a new phone. you need to trade-in that busted up phone and get you a brand new iphone 16 pro at t-mobile. it's on them. families save 20% every month. what a deal! new and existing customers, trade in your busted old phone, and we'll give you a new iphone 16 pro with apple intelligence on 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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it is 8:00 a.m. on the east coast, and you're watching "squawk box" right here on cnbc. i'm becky quick along with andrew ross sorkin and among today's top stories. a government shutdown looming in washington president-elect trump and elon musk heavily criticizing house speaker mike johnsjohnson's three-month extension. that's likely to be a no-go among lawmakers. they have to come up with a plan b if they don't want the government to shut down tomorrow night. amazon workers at seven u.s. facilities going on strike and looking to pressure the retail giant at the contract talks, but with unions representing just 1% of amazon's work force, the company says it does not expect any effect on its operations.

and one of this morning's movers, darden restaurants is up this morning by close to 10% about 9.25% right now. the company reporting better than expected same-store sales growth at its olive garden and longhorn steakhouse chains. the futures right now, we're get a little bit be pretty good, 224 points after 1100 points yesterday, that doesn't feel quite as good. we'll see if it sustains let's take a look at treasuries, which we did see 4.52 earlier, now 4.53 on the ten-year for more on the selloff, let's get to mike santoli at the new york stock exchange. looking for a rebound but was damage done yesterday to the internals? >> i would say not to a longer term trend, joe, but you definitely did a little damage to the shorter term trend. bouncing, perhaps, where you might expect it to the s&p 500, it did close pretty much on the lows yesterday in addition to repricing that fed path and the bond yields going up to six-month highs, you

did have all the headlines hitting about the continuing resolution falling apart probably didn't help even though that wasn't the cause. we've come down basically just below the 50-day moving average on the s&p 500 also interesting is it's both the november lows and october highs. we'll see if that swept away a little bit of the -- i wouldn't say froth but basically the indexes that i've been talking about forever have been held aloft by a handful of stocks that led the downside. that could be part of the positive, maybe we got flush in the oversold parts of the market as the leaders buckled a little bit. take a look at the nasdaq 100. you see that huge gap that opened up here over the last few weeks. some of that has been closed nasdaq was down 2.5% yesterday that was rectifying divergence it's a good thing the average stock had been weak for a few

weeks. they're close to actually being prime for some kind of a relief bounce here in the cyclical parts of the market, in particular, had been hurt. i think that's why the fed's message of ambiguous path from here, because the rate-sensitive parts of the market. take a look at housing and transports relative to the broader s&p 500. that's the s&p, the home builders and transportation stocks they're barely above flat. that's where the concern is. i think we would be fine with a slower rate-cutting path, maybe not many more cuts at all if everyone had the confidence the economy had a head of steam. you have an opaque policy picture on all fronts, monetary and fiscal that will weigh on an expensive market i think that's all we're talking about here there was a lot of froth flowing in speculative stocks. maybe some of that gets

rectified as well. >> mike, i think that's 100% the case i think the problem becomes if you're not going to get any more rate cuts and the economy turns down but the fed can't do anything because inflation is the picture here, i think that's where people start worry being the potential for stagflation. >> that's exactly right. even if it's not true stagflation, you're not really meeting your - >> something that rhymes with that >> subpar on both those fronts and it's really much more a matter of you have to open yourself up to a huge -- a bigger range of probabilities in terms of how the fed reacts. we had fed keeping static for 14 months as they waited for inflation to come down, the markets were good with it. there is a scenario if that continues here and they pause for a while. >> mike, thank you right now we want to take a look at the housing market as we head into 2025 joining us to do just that is sheryl palmer, chairman and ceo of taylor morrison

thank you for coming in. >> good morning. absolutely >> let's jump off with what the fed told us yesterday as a starting point for how we're going to look at housing in 2025 obviously, rates are incredibly important, mortgage rates for what happens with home buyers, what happens with sales. what did you hear yesterday from the federal reserve and do you do anything to change your business operations as a result? >> good question, becky. a little surprised about the reaction because i didn't really hear anything that was different than i think the market already expected the cut was 95% built into the market it's been a few months we had kind of seen a move from maybe four or five cuts next year to probably a couple. the interesting thing, i haven't been able to read everything, but what i've been through so far, the interesting thing, it feels like some of the narrative was about what might happen

under the new administration as compared to the state of the economy today. when i look at the movement in targets or expectations, not significantly different from where they were a few months ago. >> what roger ferguson, former federal vice chair of the fed told us earlier, those two cuts they're talking about on the dot plots, he wouldn't bet money on that it's just uncertainty. i think what may be more important is watching what happened to the ten-year note where it picked up above 4.5%. even as the fed has been cutting rates this whole time, i think the ten-year has moved up, 15 basis points before, 80 basis points >> we saw that -- like you said, we saw that when he cut 50 last time we saw the ten-year. we saw mortgage rates go up. i think what we need more than anything is just some stability across expectations because there has been so much

volatility and it's the erratic movement in the ten-year is more impactful than the rates itself. certainly the higher rates are impacting the resell market. i think we've known that for quite some time. they don't have the ability to help the customer get into their new home with some of the tools we have in our tool box. >> you have tools but it cost you on the margin. >> our margin has been steady for the last eight quarters. it's been consistent honestly, this will be quite a year for us. yes, it's how you use those tools. one of the advantages we have, becky, is the diversity in our portfolio. if you go back to covid days, it was all about spec homes and serving the first-time buyer that buyer is more compromised today. it takes more to get them to their front door. >> like what you have to give them higher quality cabinets or -- >> no. the cost of getting to a monthly payment that works for them.

that's a subset of my business i have two-thirds with my move-up buyer, active adult, 55-plus, it has a lot of different names, that's predominantly a cash business. they have a lot of equity. the equity in the country today is, on average, $400,000 but that's not helping those first-time buyers. so, we need to separate strategies unfortunately, everything traveled yesterday in not a good way. but the strategies are different. our business is not nearly as affected by some of these movements. >> you said something in the notes that really surprised me the idea that supply is not the issue for you. that there's -- you have plenty of supply. that doesn't match up with what we've heard on a national narrative. >> yeah. i think there's some mixed messages out there and some confusion, for a couple of reasons. one, not all inventory is created equal. on average the inventory today

resale is about 40 years old there's a lot of costs that goes into a buyer buying that home. if you couple that along with the location of that inventory, it's why we've seen a preference to new, as well as the builders are able to help customers buy down rates but when you look in total, i think you have to look at a couple things. one, you know, if you take all new inventory, and much of that new inventory in the numbers hasn't started yet if you look at all new inventory, resale inventory, in total we're about 800,000 units below our long-term average. i think you have to not just look at the numbers of inventory, but months in supply that's actually starting to come down we do a lot of research understanding the type of inventory that's out there as we look across the country, probably 30% of our communities across the country, and we started saying, okay, what's the age of the inventory, what's the price point, what's the square

footage within a three, four mile kind of radius. it went from less than 20% actually being what i would consider competitive industry. a lot of inventory got built during the heyday of covid further out. people didn't feel like they had to come to work. >> because people were working from home. >> wrong place, wrong size, and for the first-time buyers and they're struggling, and they still have to drive to work. >> a lot of changes that have happened instantaneously how do you fix that? >> you have to start peeling back for us i think the industry is working hard to address affordability. all these conversations -- it's not just mortgage rates. it's all the cost of living is affecting that first-time buyer without equity to bring. on average our loan-to-values are significantly lower than the average. so, it's square footage. it's becoming more efficient in the way we build i think that's happening through

really some of the advantages the large builders are getting for continuing to take share. >> do you worry when there's talk about tariffs, even with a country like canada where we get a lot of timber from >> yeah. i think we have to see what happens on the other side of this we have worked hard through covid to develop our product domestically as we looked at the cost of this as our lumber comes from canada. i'm not going to ignore it, i'm just not convinced we'll see this in the way people are thinking or understand this is a posturing. >> what's your outlook overall for 2025 if you had to assign a grade to what you think the industry is going to look like >> slightly up slightly up. >> excellent i want to thank you for coming in today. >> good to see you. >> good to see you. when we come back, a lot more on "squawk. egd re to watch anjemy siel will join us. don't go anywhere. "squawk box" returns after this. .

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welcome back to "squawk

box. i'm dominic chu. shares of micron are sinking 12%. the memory chip giant issuing under whelming outlook for the current quarter. saying while consumer markets have been weaker, the business does expect to rebound in the second half so those shares down lennar down 8%, missing on profits and revenue for their quarter. results were driven by affordability issues, given higher interest rates. the 30-year fixed rate mortgage is currently at a four-month high, providing some headwind. lennar down 8% shares of vertex down as a study shows nonopioid pain drug did not reduce pain more than a placebo. the study was not designed to be a direct comparison to the condition itself and has no approved treatments as of yet. a dow component nike is set to report earnings after the bell the first under new ceo elliott

hill keep an eye on nike shares after the bell i'll send things back over to you. joining us -- thanks, dom -- to talk about the state of the markets, jeremy siegel is here, professor ameritas, chief economist at wisdom tree good morning to you. clearly, the market was caught offguard i'm surprised the market was caught offguard as after as they are. if you watched our broadcast, i think joe and becky and just about everybody we've had on the last week or two suggested that we may still get a cut but we'll get hawkish language after that. the market seems to think this was some great surprise. >> yeah. i agree with you and it was exactly as i expected i actually think it's a healthy development. back in september when they lowered 50 basis points, i said two things first of all, the neutral rate is much higher than what the fed has indicated. i think it's between 3.5% and

4% i also said long-term rates were going up i said that on your program several times. i think they're going to go up more that's not necessarily an unhealthy development. do you know that for the first time in almost three years, the ten-year is above the fed funds rate and that's a normal situation. i mean, we brought the fed funds rate, powell brought it down yesterday 4.33%. and as you know, we're 4.5% now on the ten-year. it's normal for long-term interest rates to be above short-term interest rates. we were three years in an inverted structure that's not an unhealthy situation. we are actually normalizing the interest rate structure. you could call it recalibrating, if you wish. long rates have a way to go further up >> if that's -- if that's your sort of base case, how do you

think about equities from here >> well, it's more challenging in 2025 than 2024. one of the reasons why interest rates are going up and why the neutral rate is higher, is stronger economic growth powell mentioned that many times in the news conference that gdp growth has surprised on the upside that's good for equities, bad for bonds but good for equities. certainly inflation has been more stubborn than expected. i still think there's, as he mentioned, some rental lags that i think are going to help us in 2025 get it closer to that 2%. higher interest rates don't necessarily mean a bad situation when they're caused by rises in productivity or rises in real gdp. that's certainly one of the causes of the rise in the long-term rates. >> but then you look at yesterday or today and say, this

is a dip, here's an opportunity or do you say there's going to be a bigger dip? >> i thought there was a lot of trend followers, a lot of momentum players they were on the train running up tesla, the mag 7. that's not a healthy situation all it takes is a little negative knock and they jump off the train. and i prefer to see a market more dominated by fundamentals than momentum players just taking the ride. so, i actually think market is certainly healthier today than it has been for the last few weeks where we saw a lot of momentum players >> how do you estimate, factor in, bet on what happens in 2025 to the economy, to it the equity market in the context of the tariff conversation we've been having all morning in the context of whatever you think

tax policy is going to look like >> yeah. i think the tariff is the biggest question, and the immigration question are both big questions that are facing the market but there's a lot of positive features however, i don't think we'll match the gains of '23 '24 i'm thinking zero to 10% probably overall, i would -- i wouldn't be surprised to see finally value stocks break up more on the upside and maybe the mag 7 taking a rest from an incredible run. i dope think it's any sort of bubble on the mag 7 but to keep up 40%, 50% gains is something that would be extremely against the odds for next year a bit of rotation, a quieter stock market, but still positive for investors. >> fair enough

professor, great to see you. happy holidays. >> thank you very much. still to come this morning, jon fortt wraps up his year of "on the other hand" and we'll speak with former fed vice chairman richard clarida "squawk box" will be right back.

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been a busy year of "on the other hand" topics starting in january with the question, will apple lose its status as the most valuable stock and culminating with last week's argue about the suspect in the killing of united healthcare ceo, jon fortt is here with us with a look back and he's going to tell us which side he was actually on on every one of

those "on the other hand." would there be 52 you could tell us. >> joe, i think in 2025 i'll make both arguments but actually tell you which one i'm leaning toward as fun as it is for me to know for sure i'm going to win every argument here, that's not how real debates work. the first debate in 2024, it's funny, i said the biggest threat to its leadership was a valuation reset not verizon and that turned out to be true it would have been more interesting, had you known i really believed that or october peloton, arguing they were up. did i really think that was going to happen? we're in the age of artificial intelligence where prompt engineering is now a life skill and people deserve my best shot and the answer to the questions. so i think in 2025 we take a shot at telling people which

side i'm leaning towards. >> are you serious you're going to -- you're setting us up. there's no way you're going to start telling us. >> then it wouldn't be a segment, fortt, you know that. he's yanking our chain. >> he is, right? >> well, joe on the other hand, telling you my opinion every week would ruin "on the other hand" because i wouldn't be able to do the stock topics and the political topics would be off limits. that i did a month ago, comcast a death nail for cable networks? probably not happening i originally conceived of this segment because opinions are fun. as a news reporter i knew i couldn't get away with delivering a sharply worded opinion every week but i thought i could get away with delivering two. the twist for me and the process of working on this every week, i discovered i have a lot more questions than one-sided arguments. on top of, that i don't think viewers should care much what i think on matters of opinion. don't get me wrong, i have a healthy ego but probably a lot more useful for me to share how

i'm thinking about these issues and what facts i'm gathering in 2025 people can look at my scratch paper, culate their own opinions >> you could tell us - >> you're both sides of "cross fire" and you get animated and get salient points on both sides, almost like a true psychopath who can take either side -- >> psychopaths get a bad rap. >> they do >> sociopath is a little better, but -- >> yeah. think about that, you don't really need a debating partner most issues do have two sides. >> they do. >> a lot have more than that we simplify it here. at least hopefully to get people to think about it. >> that was the perfect end-of-the-year wrap-up. >> tell us what you really

think, jon. >> the second one. >> on that one he did -- >> that was the -- >> like all the other times -- other ones where the second one is the one that you -- >> well, you know. when i'm constructing them that way. newsletter, you can get this and all of the ones from the past and in the future. love to have you in 2025 da, up next, breaking gdp ta plus initial jobless claims. "squawk box" coming right back

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welcome back to "squawk box. richard santelli live at the cme hq getting ready for the news of the morning. our gdp, last look on third quarter coming in much better than expected. 3.1% versus 2.8% that definitely means it now moves to the best level since the last quarter of last year when it was 3.2% if we look at consumption t also ramped up from 3.5% to 3.7%. that's the best consumption rate since the first quarter of '23 the pricing index, holding

steady at 1.9% personal consumption expenditure, quarter over quarter on that pricing index, one-tenth warmer than expected one-tenth warmer in the rearview mirror at 2.237 that would be the warmest since 2.8 in the second quarter of this year. initial claims, 220,000, less than we were looking for 22,000 less than our last look, at this point is still unrevised. 220 would be the lightest since the third week of november of this year. timely, number 28 in a row above 1.8 million, 1,874,000 on continuing claims. finally, philly fed, this is a very contemporary number, d-3 minus 6.4. we were looking for a positive number this will be the most negative number of the year, actually, of the year, minus 16.4 takes you

all the way back to april of last year. so, manufacturing not looking good interest rates, curve steepening how many times have i said that over the last 14 months? yes, we see that long duration rates are higher right now you're at 4.54 on a ten-year, up a couple of basis points a two-year, three-year, five-year, they're still all under yesterday's yields higher prices twos to tens at 2.5 basis points the dollar flying. yesterday's close on the dollar index, guys, was the highest close going back to nov of '22 against the onshore yuan, it's at the best level in 13 months the ten-year yield has now traded higher than its previous high yield for nine sessions in a row. andrew, back to you. >> rick, thank you for all of that steve liesman's at the desk. he's looking at some of the

numbers himself. i think trying to make sense of it. >> i like the fact that the pce price index is 1.5 ex-food and energy did go up a tick, 2.2. i like the fact income is up a bit more than expected i'm looking for the consumption numbers. i don't see that necessarily i also like the fact we took that leg down. we were worried last week. there was some stagflation talk last week about that jobless claims number being north of 240. now back down to 220 we're not seeing the firing in the jobs market but not necessarily the hiring that's the question, small business not doing as much hiring as it had been. should the fed be cutting. the deflation problem is manifest people talk about that the other side is that tick down we talked about in private sector hiring. it had been up 170,000 through the first six months of the year now it's 110,000 kind of normal but it's a reason

why the fed might want to shift towards more neutral because you're back down to more normal job creation >> steve, we have a great guest. >> for more on the economy and the fed's latest rate cut, let's bring in richard clarida, former fed vice chairman and now global economic adviser at pimco. so, we were talking, it was three minutes ago. i think i can remember do you remember what we were talking about? let's just recount what i asked you when you sat down. first thing i said was, is it possible the fed hikes next year you said probably not. and then i said, do you think the risks are symmetric, i'm asking if both mandates are equally important right now. i think you started to tell me, no, the inflation -- the dollar stability side of things is more important to what the fed should be doing right now i said, why are we cutting

>> i do think the risk to inflation are to the upside. i think the committee and the chair acknowledged that yesterday. i think the case for cuts going into september was the data was cooperating and they felt the policy was restrictive i think the case for a cut yesterday was a close call, indeed we had president hammock dissenting and the unusual situation, joe, where three other officials, presumably presidents, also indicated they didn't support the cut through their dot. i think it was a close call. i do welcome the fact the committee -- this first phase of recalibration appears to be over and they're now really talking, and i believe them, that they're going to be very data dependent about the timing and extent of future cuts. and i applaud that >> the whole nebulous, how the

fed decides what is restrictive and neutral is based on the economy and conditions when they look around and what they see. and that's why i would have thought i would have come to a different conclusion given the stock market, the gdp number we just posted, bitcoin, we've talked about the banana on the wall, all the things that we see didn't appear that we were in restrictive territory and didn't seem like an environment where you would have cut 100 basis points. >> well, my comment on that is very consistent with what you said it's a complex economy, financial markets. financial conditions broadly defined, including the fed's own index, are easier than they were before the first hike. they've eased a lot, higher stock prices and tight credit spreads and all the rest the fed also focuses on the rate they control, which is the interest rate. they judge, and i use that word

precisely, they judge policy is restrictive. but they also acknowledge on the committee there's a range of use about that that's why i think it is appropriate as we move into '25 to move away from a model base re judge as restrictive to more of a database, are we getting that on inflation? a year ago, december of 2023, the year over year pce inflation rate was 2.9 that was good news below three for the first time in three years it's going to come in at 2.8 or 2.9. by that metric, very little progress on their preferred measure. they're forecasting additional progress next year right now that's a forecast. data dependence here is the way to go. >> i'm old enough to remember a bunch of times when the fed had to take back things they have done i hope in the middle of doing something like this, we're

pointing out that this may not -- we may not know if it were in the midst of a policy mistake. like when we were at zero too long, did we really talk about -- did we know we were in the middle of a policy and say, could we know right now that we shouldn't be easing? >> it would be difficult given, i think, the labor market data, and steve raised this point. i think if you are looking for evidence that confirms the wisdom of some of the cuts is the labor market is slowing, particularly private employment. the fed does have employment as part of the mandate. but because of those long and variable lags, joe, typically you don't always know in the midst of a policy mistake until some time into it. i couldn't rule that out. >> we could be cutting like crazy because the labor market weakened so much in a year. >> yeah. i just want to try this math on you, joe, and clarity from - >> clarity from clarida.

>> nobody else can do it like he does joe, if you had a % inflation rate and a 5.3 funds rate, and that 7% comes down to 2.5 to 3, you need something less than the 5.3. >> no, not necessarily i'd like to keep -- if i'm not -- i'd like to save my powder in case -- because the -- >> you want to keep slamming down the economy - >> where do you see evidence of slamming >> well, that's a good point because the thing i want to ask former vice chair -- >> former vice chair - >> you're still a vice chair to me >> okay. >> isn't some of the relaxation of financial conditions right now a direct result of one year ago or so when the fed pivoted so, that's what you have in the economy right now. if the fed had not pivoted, you would not have these financial conditions therefore, it was sort of a

result of that or maybe the right thing to do. >> the other thing i will point out, though, is the disinflation from six down to 2.5 is remarkable the fact we avoided a recession is remarkable and unusual. and the chair himself towards the end emphasized it yesterday. the u.s. economy is quite remarkable right now we have the highest productivity growth in the world. we have an innovative economy, energy independent, household balance sheets are in great shape. we keep focusing on things that can go wrong, and i think even the fed is disappointed that progress on inflation appears to have stalled the fundamentals are good. part of the buoyancy in risk appetite is where would you rather invest, the u.s. or any other country in the world >> what was that number we got yesterday that you were asking about, the minus 3.10 on the current account balance, in part because we are importing enormous amounts of capital.

one thing we don't talk about enough, richard, the rest of the world is somewhat of a smoldering dumpster fire, right? i don't know if that's overstating it but again marry and france doesn't look wonderful china doesn't look wonderful that's part -- by the way, it's part of a disinflation story in the u.s. eventually. >> yeah. i -- again, i think the facts speak for themselves the u.s. is the only advanced economy that's above its prepandemic trend level of growth we're doing it with stronger productivity as i said, a lot of innovation you are the experts on the stock market, but companies are profitable and productivity is strong i think a lot of the buoyancy in financial conditions is a sound economy. >> it would be nice to keep it going. >> indeed. >> and maybe that's part of the thinking. >> i'm not leaving until you feel better. i'm going to stay right here. >> i did feel a little better.

thinking if the counterfactual is if we had not cut, we wouldn't be at 3.1 - >> you're still up -- joe, i'll give you -- you're still up 2.7 since the election come on, that was a huge bump. different things with the trump administration you're going to get some good -- >> the other thing -- the only other thing that worries me is we may have some inflation still left in the pipeline from all the stimulus post pandemic that maybe we shouldn't have done we may have some future inflation with some of the policies that the trump administration is talking about. there could be some left and we could be adding to some. >> i think the key point, though, is a lot has to happen between today when you actually get a fiscal legislation, the tax cuts, extended trade policy, and in particular, i think the fed is on the right course to not get too cute and too precise

about what they need to do today based on some tax bill that may pass in 10, 11 months. >> the first thing you said is most important, they're data dependent. >> and they should be. and i think that goes both ways. i do think the chair did buy himself some important optionality -- or the committee, i should say, it was a committee decision in the dots to only show two cuts for next year, is essentially saying, when's the next cut, mr. chair, maybe june? >> i got to tell you, not better than richard clarida maybe at the same level we have john wayne fed president tomorrow at this time. >> i'll be watching, as always >> 8:30. >> thank you when we come back, illinois congressman raja krishnamoorthi will join us "squawk box" will beig bk. rhtac

our next guest joins us to talk about the possible u.s. tiktok ban coming next month yesterday the supreme court agreed to hear that case first, though, we want to get a take on a potential government shutdown tomorrow night. the odds of that seeming to rise as president-elect trump and elon musk threw water on the stopgap spending bill. joining us is raja krishnamoorthi congress map, first, let's talk about this potential for a shutdown you think we'll see a government shutdown tomorrow? >> i sure hope not as you mentioned, chances are rising last night president trump and co-president elon musk basically tanked a bipartisan deal that was on the table we were then shut out of the negotiations

and i'm hoping the gop will come back with something we can vote on leader jeffries is ready to hear them out too many people are going to get hurt if a shutdown actually occurs >> the idea of a clean bill, is that something you would vote for, without any of the other things - >> sure. >> -- from farm -- helping farmers to aid for flood victims? >> well, i think there has to be disaster aid but apart -- if it's a clean cr, i think it would be fine right now we have millions of people through no fault of their own harmed by the recent national disasters, and i think the american people want to help them. >> congressman, let's turn to tiktok, which is why we had you on to begin with today this idea the supreme court has now taken up the idea of whether this law is constitutional, whether it's acceptable to tell

tiktok they have to divest or shut down, how do you think the supreme court is going to rule on this? >> i hope and expect they will uphold the law just as the d.c. circuit court of appeal it is did. the clock is ticking, as my children would say, tick-tock, it's time for bytedance to sell tiktok and allow the platform to flourish without the control of the ccp looming over it. >> even if the court does decide in your favor in this case, i think the biggest question is what president-elect donald trump will do. this ban goes into place the day before he is inaugurated as president. >> sure. well, i've met with incoming national security adviser, mike walz, a friend and colleague of mine i think the way they see it is similar to us. they want tiktok to survive and flourish, but they don't want it to be controlled by the chinese

communist party. so, the best way for that to happen is if bytedance sells tiktok right now >> so, bytedance has said -- or tiktok has said that that's not an option. that's not going to happen how do you think this plays out? >> well, what you pointed out is the central issue here, which is that tiktok and bytedance repeatedly say they are not under the control of the ccp but when pressed as to why bytedance can't sell tiktok, they say because we're under the control of the ccp and the ccp does not want us to sell tiktok. as the appeals court said, we in congress don't have to legislate around the preferences of the ccp. the ball is in their court i think they should allow bytedance to sell tiktok and allow it to flourish here. >> even if that were to happen, it's not a process of something

that would happen instantaneously. i do realize in that same letter that you've sent to, i believe, tim cook at apple and other places in silicon valley, places you would expect they would be taking the tiktok app off, if you're successful ahead of the supreme court, even if that's the case, it means there's not going to be a tiktok come january 20th unless president trump says okay and extends it this has not been set in place they've decided to fight it rather than go along with this do you imagine an america where there is no tiktok accessibility for some period of time, unless and until they're able to sell it >> remember, on january 19th, if there is a sales process under way, president biden could extend the period during which they can sell the company. so, that's what they should do they should initiate that

process now, be -- get as far as they possibly can. if they have to, ask the government for an extension of time that would be the responsible thing to do to enable uninterruption of the platform >> again, you're not sure how the trump administration, the incoming trump administration, would handle this even though you've talked with the security adviser. what was conveyed to you in that conversation >> they have a warm corner in their heart for tiktok, as millions of americans do but they don't want tiktok to be controlled by the ccp. and so i think right now donald trump and his incoming administration could help engineer the deal of the year by making sure that bytedance sells tiktok, encouraging them to do so there are numerous bidders who are stepping up as we speak.

i think frank mccourt of liberty media group was one of them. but the point is they can sell if they want to. if the ccp, their overlords allow them to do so. >> congressman, thank you. we appreciate your time today. >> thank you so much thank you. "squawk box" will be right back business. it's not a nine-to-five proposition. it's all day and into the night. it's all the things that keep this world turning. it's the go-tos that keep us going. the places we cheer. trust. hang out. and check in. they all choose the advanced network solutions and round the clock partnership from comcast business. powering more businesses than anyone. powering possibilities.

nasdaq tumbling more than 3.5% yesterday that follows the fed rate cut and forecast of fewer cuts, of course, next year than had been previously telegraphed, although i think it's a little telegraphed on our broadcast joining us, paul meeks, harvard managing cio we've seen the downdraft is this a dip or falling knife, sir? >> well, sir, happy holidays to you, number one. number two, i think this correction could last a bit. you've seen the marquee name in nvidia to come down. what i would expect people to do, what i would recommend

people to do is maybe keep some powder dry i think these a.i. infrastructure stocks in particular might see some near-term pressure as folks worry about a digestion in the spending of the hyperscalers on gpus and other infrastructure gear for data centers. however, i would take the opportunity as a pause at refreshes and on any significant dip on nvidia at all, i would probably buy them. i do think in the near term this correction could continue. i see particular weakness echoed in micron's results last night, in all things consumer electronics. their nan flash business is doing very poorly and it's worsening. and think about this, this is flash memory chips that go into smartphones, pcs, cars and other industrial applications. so, that's the bad stuff within

semiconductors the good stuff is all a.i.-related but even the good stuff would hold the phone for a bit i think you might be able to buy them a bit lower >> i guess that's the question, though you're just saying on nvidia, as long as it keeps going down, what would you buy it at >> i think i'd probably look to find support at the 200-day moving average i'd also like to get a feed into the news that we won't actually get until the third and fourth week of january on the revised spending plans, if at all, from the a.i. hyperscalers, the ones spending the tens of billions of dollars on infrastructure. the last time -- >> what do you think those revised plans look like? >> i actually think they will confirm their guidance you know, these are the deepest of all pockets when they say they're going to spend tens of billions of dollars, they typically do it, and then sometimes they actually forecast on the downside and

raise things i think we're going to be okay but i do think that there's going to be some worries not necessarily by me, but others, that some time in '25 you will see a digestion of this a.i. infrastructure spending >> paul, we got to leave it there. we want to wish you a very happy holidays we thank you >> best wishes >> you bet a quick final check on the markets this morning after what was a big downdraft day yesterday. looks like we'll have a bit of a bounce at the open dow up about 218 points. nasdaq looking to open 105 points higher, 104 s&p 500 up close to 400 points on the ten-year note, looking at 4.552. the two-year down at 4.319%. the energy complex, oil wti crude, that sitting now just at about 71.12. we've talked about crypto, which

dipped to 101,000, 102,000. >> recent discussions among u.s. representatives, rand paul have brought forth the idea -- >> i just saw this. >> -- of elon musk replacing mike johnson as congress. >> apparently you don't have to be >> -- of elon musk replacing mike johnson as speaker of the house. >> there you have it, folks. as the world turns make sure you join us tomorrow "squawk on the street" begins right now. >> good thursday morning i'm carl consistent ania at post nine bulls looking for the stocks to hold and the vix, second highest single day surge ever. ten-year yield, 4.74 road map begins with the bounce back stocks looking for ahe