and "squawk box" begins right now. ♪ good morning, everybody. welcome to "squawk box" here on market site in times square, i'm becky quick along with andrew ross sorkin. joe is out today. >> happy new year. >> great to see you. let's look at how the u.s. equity futures are shaping up at this hour. there are modest advances, dow futures up by about 7 after closing down on friday. s&p is up by about 26, it had an up day on friday, up by about 1.25%. the nasdaq had its best day in two months back on friday. you are looking at significant gains, up 1.75%. all three of the major averages did close lower. if you are watching for that santa claus rally at this point, no, not going to happen. let's look at treasury yields

this morning as well. they have been picking up pretty significantly. if you look at this point you're going to see that the 10 year is all the way up above 4.6%, 4.61%, the 2 year is above 4.28%. again, the gains that we've seen in treasury yields ever since the fed kind of indicated that it was going to stop cutting rates have been something to watch. >> meantime, take a look at this story, foxconn posting its highest ever revenue for the fourth quarter on strong demands for ai servers. jumping 15.2%, $65 billion in total. global chip stocks jumping on the back of that report. you can look at them, pretty much across the board asm international up over 4%. taiwan semi up 4% as well, nvidia up not as much, about 2% and micron a little over 3% right about now. yesterday president biden signing the social security fairness act, that's the bipartisan bill that clears the

way for increases in benefits for public sector workers like teachers, firefighters and policemen who also received pension income. it repeals two provisions that have been in place for more than four decades that reduce social security benefits for those who receive pension or disability benefits where social security payroll taxes were not withheld. more than 2.5 million americans will receive a lump sum payment of thousands of dollars to make up for the shortfall in benefits they should have received in 2024. that bill was passed by the senate on december 21st with 76 senators in favor. it easily passed the house back in november as well. president biden now set to order a ban on new offshore oil and gas development across 625 million acres of u.s. coastal territory, expected to be announced today. the proclamation will be difficult for president trump to reverse when he takes office and i think some of the critics of this decision think that's what he is trying to do ahead of

president-elect trump's administration. it is rooted in a 72-year-old federal law that empowers presidents to ban oil leasing in u.s. waters but doesn't authorize presidents to then be able to revoke the ban. that's the interesting part about it. presidents have successfully modified such orders in the past but courts have never validated a complete reversal. >> i think we're seeing a lot of this in the waning days of the biden administration. it's kind of super charged executive orders. it used to be that i would say over the last three or four presidencies, especially since barack obama there have been a step up in executive orders that have been issued, especially at the end of a president's term. what we've seen over the last 12 years or so is that every president who comes and wipes out the last guy's executive orders. >> tries to. >> tries to wipe them out. this is the super charged version of that. >> i don't love it. i don't love it. i think if the country elects somebody, let them do what they're supposed to do. i think the idea of trying to

throw -- throw sand in the gears, if you will, in advance of that, it's a little -- i mean, it's a very different situation but it's a little like there were a whole bunch of presidents over the years who left the white house and as they were walking out they took furniture, all the things that just made it harder no. reason for it. >> some of these things you've also seen this administration do things like extend some of the benefits for working from home to allow public workers and the government to do those things. again, in terms of throwing sand in the gears of doge or anybody else who is going to try to come in and increase efficiency with some of these things, too. >> other transitions, president-elect trump will be transitioning in, he wasn't showing up at the inauguration of other presidents. so we should all just put this in a little bit of context, too. house speaker mike johnson won his gavel back on the first ballot on friday after some wrangling convinced two congressmen who voted against him to flip their votes. speaker johnson said republicans would use the reconciliation

process to enact his agenda on the border, taxes and energy. that process only requires a simple majority of 51 votes in the senate meaning republicans can pass it without democratic votes. on truth social trump said that the bill would include tariffs and eliminate taxes on tips. he urged republicans to unite and send that bill to his desk to sign as soon as possible. senate majority leader john thune and others have been pushing a two-bill strategy that would include a border and energy bill first followed by a tax bill. house ways and means chair jason smith has pushed for the one-bill strategy warning that splitting the policy measures could risk not passing an extension of the 2017 tax cuts that are set to expire at the year-end. apple ceo tim cook planning to donate $1 million to president-elect trump's inaugural committee. axios reporting that the donation will come from cook personally it's not going to come from the company. other donors to the fund include amazon, meta, uber and observe

ai's ceo sam altman. a whole bunch of tech companies now in some ways almost competing with each other for the donation -- >> i guess you stand out if you have not made the donation at this point. >> i mean, at this point you would. exactly. i don't know. this i find a little bit more troubling only because these companies never were doing this prior. >> i was going to say the companies that have done it before it makes sense. i think bank of america did it, but they've done this with every presidential inauguration fund that comes through. if you are looking at it and just doing it as a course of business -- >> if it's a regular course of business, if it's different -- now the question is will this be the regular course forever for these companies. we'll see. by the way, maybe the world has changed in such a way that actually technology companies -- it used to be a bank of america or a lockheed martin or some big company that needed washington -- >> lobbying. >> right. all of these tech companies are now -- >> the lobbying business. over the weekend two federal

reserve policymakers said that the central bank's job on taming inflation is not yet done. adriana kugler spoke at a panel at the american association conference in san francisco. she said no one is popping champagne to celebrate the decline in inflation and they want to make sure that the recent bump in inflation didn't prove persistent. she also said she wants to see the unemployment rate stay where it is. speaking at that same panel san francisco fed president mary daly echoed those comments saying she does not want to see further slowing in the labor market. i think steve liesman was there for some of these comments. i think that's who these comments were made to. maybe i'm wrong. microsoft planning to spend $80 billion in fiscal 2025 that ends in june. that's on the construction of ai data centers. if you thought that maybe there was like an ai bubble or something, at least in the construction of infrastructure, not anytime soon. the company's vice chair brad smith saying in a blog post more

than half the infrastructure spending will take place in the u.s. he called on the incoming trump administration to protect the company's leadership in ai through education and promotion of the u.s.'s ai technology abroad. we have a lot more coming up on "squawk." it is a huge jobs week in america, we will get you ready for the trading week ahead as well and a programming note, we have an exit interview happening with outgoing ftc chair lina khan. it's an interview you do not want to miss, it's going to happen tomorrow 8:30 a.m. eastern time only on "squawk box."

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welcome back to "squawk box." on this week's squawk planner it is the first full trading week of the year but markets will be closed in the u.s. on thursday in honor of former president jimmy carter and the national day of mourpg. fed minutes will be released on wednesday, also the labor department moved up the release of weekly jobless claims to wednesday and we will be getting an adp private payrolls on wednesday ahead of friday's december employment report. then on the earnings front, put this on your list, folks, we have delta airlines, they will be reporting on friday morning along with constellation brands and walgreens. take a look at this futures on this monday morning, they're slightly higher as investors i think are trying to look a little bit forward to friday's jobs numbers.

joining us right now is the ceo and cio at defiance ets. given the numbers we will be given later this week and we start the earnings parade of sorts, how do you position yourself? >> good morning, andrew. well, i think that, you know, we're into a new year now, you're going to have the new presidency coming in and i think there's a lot of tailwinds going into this year and a lot of that could show up in stocks in the first quarter. you have strong jobs so far, you have a resilient consumer that continues to spend, corporate earnings have been good, will probably continue to be good. we are in a year whether or not the fed cuts as much as we might want them to, there will be some fed cuts. when you have fed cuts you usually have stock rallies provided there is no recession. i think that the overall story for this year is positive. >> if we had this conversation shall we say a year from now do you have an expectation that the market is meaningfully higher than it is right now? >> i do.

you know, i expect the market to be up in the range of, you know, 10% to 15% or so this year. we had an epic rally last year, 2024 was a great year, up over 20% or so, that's only happened about nine times or so. i do think that some of the steam will come off of that but the broad-based equity market should still remain up for the year. >> because what? >> sorry, what was that? >> because what? it's not preordained that it has to go up 10 or 15% a year. >> i think that corporate earnings remain strong. i don't see necessarily why that will change, particularly if you have some rate cuts in the background. you have this massive level of innovation that's going on behind us, right, the ai trend is going to continue to grow and that's going to start playing out and feeding down into various sectors. i think quantum computing is going to be the new ai for 2025 so i think you're going to have pockets of stock that actually have four or five or six times the performance of the s&p 500 this year in that space. so overall i think you're going

to have continued corporate growth, healthy economic expansion 2 to 2.5%, strong consumer and there is a lot of reason why this should become derailed. i don't think it's going to run up 20, 30, 40% like we saw this year but i do think you're going to have a positive equity market this year. >> one of the big questions still out there is what happens to tariffs and as a result what would happen to consumer prices and inflation along the way. there is a story in the "washington post" this morning that i'm just reading through that says in these two weeks before he comes in and assumes office that trump aides are getting ready with universal tariff plans, but there is a pretty big key change at least according to this "washington post" report. they're saying while the tariffs would apply to goods coming in from every country they would only apply to goods within certain sectors, things that are considered key to economic safety or security for the country. i just wonder what you make of that because no one really knows

what to expect with tariffs, but if there are tariffs that come through if they're still universal but only on key sectors, rather than on every sector, what does that mean from your perspective for stocks? >> yeah, i think the tariff policy continues to be ambiguous, it was mbiguous when the president was in office as well. so i think a lot of this is negotiation tactics and we will have to sort of see where it all lands. i think if it's specific to certain sectors, perhaps those sectors suffer a little bit and you start to see a little bit of inflation versus a big universal -- if it's not universal it tends to be a little bit better for the broad-based market. if anything if tariffs become a bit of an achilles' heel for stocks and the markets you can always look on shore and domestically. i think that then bodes trades like the x mag or small cap investments. there's always a place to put your money to work. with the trillions of dollars of cash on the sideline something

in the market is going to rally as that comes in and market rates are lower on treasuries this year. >> you mentioned quantum computers earlier and you think this is the year of that. we can debate that, but if you are right, who do you think the winners are of that? and then by the way who are the losers? >> yeah. so with quantum computing i think, you know, just for the sake of investors it's always good to diversify. you can look at some of the large cap names like the microsoft's, amazon's and the google's to balance out the portfolio but the real players in the space are regetti, ion q, d wave, d wave up over 1,000% last year, regetti up over 1,000%. these names are really running. i think some smaller cap names that have been completely focused on this space are starting to grow and participate in this. that's where you're going to see the growth. i think it's also good to

balance them. we have an etf that does it but i think it's good to balance them with the names like google. quantum computing you are hearing a lot more about t when we had the chatgpt moment for microsoft that really blew up ai and a lot of interest in chip stocks again. i think this year with google and willow now you see a lot of money flowing into these quantum stocks. i think it's a trend that's going to be quite popular this year and for the next five. >> it will be interesting to see if you are right. we've been talking about quantum computing for a long time. sylvia, thank you. appreciate it. >> thank you. all right. when we come back congestion pricing takes place in new york city. >> did it impact you today? >> no. >> you don't know. >> i'm sure it charged me, but there is no tollbooth you ride through or anything, these are cameras that are set up to do this. i didn't otice any less traffic, but there's not always a huge amount of traffic when i come in anyway.

the real key is going to be what happens during rush hour today i suppose. that will be the first real test because this went in sunday morning at 12:01 a.m. this will be the first weekday rush hour that it deals with today. if it is successful it's a plan that could be replicated in other major cities in the united states and we have the details on that next. and later, new reporting from the "washington post" says that trump aides are exploring tariff plans that would apply to every country but only cover critical imports. this is what we were just talking about with sylvia. we will get reaction from mike allen from axios coming up in just a little bit. "squawk box" will be right back.

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arrived in new york city. drivers entering parts of manhattan today will be charged $9 during peak hours. it's the first initiative of its kind in the united states, although it does exist internationally in places like london and milan. late friday a judge ruled against new jersey's request to stop the program from taking effect. new jersey officials vowed to continue fighting the measure. president-elect trump could also try to block that toll through a lawsuit, executive order or a prolonged environmental review. we will see what happens with this, but, yeah, any notice anything this morning driving in. for anybody who drives below 60 -- >> i'm an uppersider, the

big warning is that there's going to be a huge effort for people to park on the street up there. >> i think that's probably going to be true. >> so they can come down -- >> park for free up there. >> that's an interesting thing. >> that makes sense. i think you will probably see areas where this happens, too. somebody who used to come in through the holland or lincoln tunnel may go up to the george washington bridge if they were planning on going to parts north. that's what part of these environmental reviews were all about, trying to find out what the unintended consequences will be. >> i heard about this -- so we keep a car in a parking lot on the upper west side and the guy was saying that he thinks that the rates are going to go up. >> i'm sure they will. >> up there. >> because there will be much more demand. >> people will take subways. >> i've talked to the guys at the parking garages here just below the 60th street demarcation line, they are anticipating to see a drop in business. you will see more demand above it. if you are avoiding the $9 toll to come down they can probably charge you 5 bucks more to park there. >> i don't have this issue which

you would probably think about. can you go up and down -- is it one car a day? >> every time you go through it. >> is it every time you go through it? >> i assume that's the case. >> once you are in is it an all day pass? >> if you drive across a bridge four times you pay the toll multiple times. my guess sever time you go up and down. for the uber and taxi drivers they are not going to be the ones paying that. if you take an uber or taxi you will be charged that fee. >> i've been told by my producer it is once a day. >> my guess is that won't last forever. if you are in a car you will pay for every car you come down, if you are taking ubers. >> i do think the ubers are locked in or they pay once and day and they can go back and forth. >> the thing i read last night -- again, there's so much confusion around this -- the thing i read last night suggested that the uber driver would not pay it, it would be the passenger who would be paying t it would make more sense if the car paid it once

instead of every passenger that did it. >> we will investigate. this is something that as a new yorker -- i'm happy about it because i want the revenue frankly for the subway system which we desperately need. >> i'm not because i think they should fix the subway system and the buses where nobody is paying those fees -- >> it's a problem -- >> the issue is it's not going to affect me. 9 bucks, okay, i will continue doing what i'm doing, i think it's a little classest for people doing the jobs early in the morning and don't want to take the subway in. coming up, united airlines moving up its plan to outfit its plans with in-flight internet from elon musk's starlink. phil lebeau has the details next. as we head to a break here is the look at the premarket tus.asq ifting the nda fure "squawk box" coming right back.

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welcome back to "squawk box." we are live from the nasdaq market site in times square and the futures this morning are on

the rise. right now is looks like the dow futures are indicated up by about 125 points, big winner the nasdaq up about 210 points this morning. i'm excited about this next story because it involves a bunch of these. elon musk, airlines and finally getting the internet to work while i'm in the sky. >> which never happens on planes. >> delta has figured it out recently, i have had a good experience there. united airlines speeding up the deployment of elon musk's starlink internet service with flights having access by this spring. phil lebeau joins us now with finally some good news in the skies. >> well, you are not alone in complaining about internet access when flying, andrew, and, yes, they will be deploying starlink on commercial flights starting this spring but it's going to take some time though by the end of the year you will start to see it on more of the mainline flights. they announced this deal in terms of putting starlink on all of their flights, all of their

planes. they announced this last year. what they're announcing today is that they are accelerating the deployment of starlink, what they're going to do is try it out this month and then they're going to put it on commercial flights starting this spring. it will be on all regional united flights, all of the planes on the regional fleet will have starlink by the end of this year and they're going to start to put it on the mainline commercial flights later this year. so, andrew, i'm not sure how many regional flights you take on united, you may not see it right away. in terms of access it's going to be free for mileage plus members so if you join mileage plus, become a frequent flier you will get free internet access through starlink. they have more than 40 million active members in mileage plus. currently if you are on a united flight and you want to use wifi it's $8 to $10 depending on the flight, et cetera. that's not going to be the case now. it will be free. take a look at shares of united,

keep in mind the company will be reporting its q4 results on january 21st, that will be our chance to talk with scott kirby about this. i've talked with him over the last couple months about this. he's very excited about the possibilities for a better in-flight experience. that's the one area that united historically has lagged other airlines. they've improved dramatically first under oscar munoz, that's considered under scott kirby. this is the next step in the process. we're seeing a record number of people flying. we talked with the tsa last week and got the final numbers in. 2.4 million people essentially flying every single day. that is a new record in the united states in 2024. let's see if that continues to expand in 2025. one final note, guys, take a look at shares of delta, they will be the first to report earnings. we will hear from them on friday, we will talk with ed bastian at that time and we will get a sense from them what they feel is ahead in terms of 2025,

the in-flight experience, but andrew and becky, you are not alone. there are more than a few people who have said the whole process, depending on what airline you are talking about, has never been a good one. it's always been sort of, well, it's this provider, you've got to pay this, are you a member of this frequent flier club? did you remember your password? >> maybe it works, maybe it doesn't. >> i've heard people saying i don't like this. >> you finally figure it out, you get it paid and then -- >> and then it stops working. >> -- it doesn't work. they say it's up to you to try to file the complaint to get your money back. it's a complete scam. >> exactly. >> walk us through the various airlines now. who has got the best service? i found delta recently not on the regionals i don't think but on the sort of larger planes probably -- it's free at the moment and it's pretty fast, but you tell me. who has got the best service? internet. >> since i fly them all and i

try them out on a regular basis and my producer can vouch for the fact that sometimes she hears from me in flight, sometimes she doesn't. >> right. >> i find it to be -- delta's new service and the new technology at delta has been very solid. every time that i have used it. i think that united has been improving, same with american. you know, the starlink service is already being deployed and is in use at hawaiian airlines. now, admittedly not many people are flying hawaiian airlines certainly as much as they are the other mainline carriers, but this is an area where the airlines realize they can make real progress here and it's about the in-flight experience. if you are a member of a frequent flier club like mileage plus and you like what you're getting in terms of connectivity i'm not saying that's the only reason you're going to book united but it certainly is one thing that united realizes it can do to enhance the in-flight

experience and potentially convince people to more regularly book them. >> phil, i'm looking right now, go-go, which is not a company i've loved because i have had this sort of love/hate relationship with go-go, they were the originals, the ogs, if you will, of wifi in the air. >> therm the original. >> the company has a market cap about a billion dollars, the stock is trades $8, $8.25. it's high, looks like it's up at $20, $25 even, maybe $23 back in -- oddly in 2022, i guess in the yolo days. what happens to a company like that after all of these other airlines basically replace the service with things like starlink? >> good question. i mean, they're going to have to figure out a way of reinventing themselves, especially as you have airlines like united saying we're going all-star link. if it's successful. if this turns out to be wildly successful for united do not be surprised if you see other airlines do the same thing.

the consistency has long been -- or the lack of consistency has long been the primary complaint from people using in-flight internet. if they can get better service through starlink, you can bet more airlines will go that way. >> and you think ultimately it's a free service for everybody, that's how this is going to work? >> yes, i do. i do. because if you look at an airline like united, you can use it to draw people into your mileage plus membership and once you are in there we have found that these frequent flier programs they can be very sticky. people who are in a particular program stay in that program more often. it doesn't mean they book every single flight but they tend to stay with those airlines. >> i will also say, phil, i feel a lot less anger, frustration and whatever else comes with it when the internet doesn't work and it's free than when i'm paying for it. >> nothing is worse. nothing is worse than paying for it or being in the middle of an

important conversation, email with someone and then it goes away and then you're like, aah. yeah, i understand what you're saying. >> phil lebeau bringing it to us, thank you. happy new year. nice to see. >> you you, too. bye-bye. still to come this morning, we are learning more about how republicans are planning to enact president-elect trump's legislative agenda. mike allen from axios will join nt. "sawbox" will be right back.

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some new reporting this hour from the "washington post," it says that aides to president-elect trump are exploring tariff plans that would be applied to every country but only cover critical imports, certain sectors. it says discussions center on imposing tariffs on sectors deemed to be critical to national or economic security. joining us to talk about this

and much more is mike allen, axios's cost founder. he has a piece out yesterday saying speaker johnson and president-elect donald trump are planning on pushing what could be the biggest bill in american history, a single package that includes border security, taxes and much more. so, mike, let's talk through all of this starting with what we're hearing from the "washington post" this morning. still a lot of questions, still a lot of ambiguity about how tariffs would work but it is a key part of incoming president's plans as he was laying them out to the american people. he has promised to follow through with this. i guess just the idea that they are still talking about his with two weeks to go raises the idea that these are going to be real but maybe won't be as broad as had been anticipated before. >> that's exactly right. in this reporting from the "washington post" jeff stein who is the very best on this issue, this is a narrowing of what president-elect trump had said he was going to do. so of course during the campaign he talked about 10 to 20%

tariffs on everything that's coming into the united states, but reality bites. the administration knows that there are concerns about inflation next year. they know some of this could be unpopular for its effect on consumers. so they're going to keep it on all countries so that the letter of the campaign promise is met, but it's being narrowed to those critical sectors that you mentioned. the examples that jeff stein gives, which all make sense, are the defense, industrial complex, things that are needed to make defense weapons. these are industries that the trump administration wants to bring back to the u.s., encouraging the u.s. second, critical medical supplies including syringes and, third, energy production materials that are used there. so this is still being discussed, but what we're seeing is a fine tuning of what was said on the campaign trail.

becky, there's going to be a lot of this. the president-elect has a 21-sent ten promises but as those one-sentence promises turn into details they're going to change a little bit. >> and i guess part of it, though, is setting the stage for negotiations on these things. as long as there's ambiguity there it does leave room for negotiation for president-elect to get more of what he's hoping to get from other countries. i'm trying to figure out how that plays into the 25% tariffs on things for mexico, what it means for canada. it just seems like this is part of the negotiation, part of the plans that will take place. >> that's right. jeff has gotten a window into this conversation that's going on. the other huge conversation that's going on, becky, that bill that you mentioned at the top. last night president-elect trump confirming reporting by axios

and others, talked about one great big bill. the current plan, becky, is for the house to wrap the whole trump agenda, we are talking tax cuts, we're talking the energy deregulation, we're talking the border, wrapping that all up in one big bill. in my newsletter yesterday axios a.m. we called it mega maga. that is all the president's top promises, they're going to try to put them into one bill on the theory that it's easier to pressure different parts of the house coalition to come to the table if it's one big trump-branded bill. so a couple things about this. one, it's going to be a multitrillion dollar bill. it could wind up being the biggest bill, becky, in american history and it will go on for months. >> right. >> the earliest or most optimistic time schedule for it

is that it will go into late spring, but that probably means june, could mean fall. >> i guess i get it. you're either with him or you're against him if that's the case but there is a lot riding, at lot at risk. it means that you could get nothing done. >> no, that's the big gamble and that's why there was a lot of debate about this strategy and something that axios reported exclusively is that this was finally hashed out and finally agreed to on new year's day in the bar at mar-a-lago. president-elect trump was meeting with speaker johnson who flew in for the day, vice president-elect vance was there, their aides, susie wiles, axios chief of staff -- or incoming white house chief of staff who has a great interview up on axios at this moment with mark

caputo. they all discussed the pros and cons. you're right, the con is what if you wind up with nothing. the other push, the other justification for breaking it up is could you get a quick win on the border? even yesterday we saw senator lindsey graham saying on tv that that was pretty attractive. that the senate we're hearing is concerned that if this takes this long they're going to start getting pressure for not delivering quicker, especially on the boarder. >> that's where i wanted to go with this. so if you were -- if you wanted -- if immigration was the issue -- and i don't know what you think the issues are that you think are break apart-able, but given the size and scale of it and given not just the democrats that i imagine will be against at least large parts of it but that there are going to be republicans that are going to be against any kind of massive number, right, because it's going to have to pay for itself and that's going to be almost impossible. so how does that really work?

then the question is if that's true are there pieces that you could pull out over time? >> andrew, that's a great point and you're right about the negotiation. the logic is that if it's broken up that the hardliners, the freedom caucus will say we're not going to talk about taxes until we get our border bill. members from higher tax states who are very concerned about raising or eliminating the cap on deducting state and local taxes, s.a.l.t. a great capitol hill name, they're going to say we're not going to talk about the border until we get this. so the idea behind this is the speaker thinks that he needs leverage to bring everyone to the table. now, both the trump side and the speaker side were very smart about making sure that each have

buy-in. we're told at this meeting on new year's day at mar-a-lago where vice president-elect vance was talking about ohio state and the rose bowl, his mind was headed toward that game as they discussed senate strategy, but the speaker said these are the pros and cons. this is why one bill would be easier for me, but it's your call. axios steph kite has reporting from the senate side that they still think that two bills, one on the border, one on taxes, might be doable for the reasons you talked about. >> okay. all right. mike, thank you for everything. >> becky, one quick thing that you will like a great headline from this interview with the incoming white house chief of staff, susie wiles, she has said in her west wing she's not going to tolerate back biting, drama, second guessing. >> i saw that. >> the idea is that it will be very different from the trump

one west wing. susie wiles' interview. >> i love the painting over your right shoulder, i can't stop staring at it and thinking about all the things it reminds me of. hope from above. >> thank you. i'm going to send you a link to the painter. >> that's very nice. thank you. coming up later in the broadcast, former house speaker kevin mccarthy is going to join us to talk about trump's legislative agenda. we will talk about throwing it all in one bill or more. that's coming up at 8:30 a.m. eastern time. a conversation you don't want to miss. "squawk box" coming right back after this.

welcome back. this is "squawk box." let's look at the markets on this monday morning. in the premarket you will see there are some green arrows. dow futures indicated up by close to 140 points after being down on friday. s&p was up by 1.25% on friday and it's indicated up another 40 points this morning. then you have the nasdaq which was a very strong performer on friday, up by 1.75%, it's best performance since probably two months. you are looking at the nasdaq indicated up by over 200 points this morning. here is a list at the stocks that are helping to lift those s&p futures this morning. micron is leading the way, up by 4.1%, fort net up by 4%, tara dine and moderna shares up by 3.5%. when we come back we're going to ask the question are weight loss drugs taking a bite out of the fitness industry? we hit the gym with the ceo of barry's right after this. connects you to the listing agent. feels like a work of art!

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>> welcome back to "squawk box." the rise of glp-1 treatments for obesity that i have shifted the public approach to fitness. we will talk about that and so much more but right now with joey gonzalez the global ceo of barry's, formerly barry's boot camp. a great instructor. joey, i don't think you know this but i have been in your class many times as has my wife. my wife happens to have just finished a class with kioni on the upper east side. so shout out. >> that's awesome. >> he is my favorite. how are you, joey? thank you for joining us. this is the new year, everybody is going to the gym or at least talking about going to the gym, i don't know if they're really going to the gym, but i'm curious how you think this has changed in the age of ozempic

and wegovy. >> yeah, so it's such an interesting topic because the beginning of this movement there was certainly concern that it may have a negative impact on the fitness industry, however, what's been most interesting is as the data pours in surveys show that the proportion of respondents reporting weekly exercise has doubled from 35% premedication to 71% after they're on the medication. so that's basically saying that people are twice as likely to get a gym membership or to start working out once they start their glp-1s. i believe this is most likely a response based on feeling more physically apt as well as having the sort of motivation and confidence to go to the gym. >> what percentage -- >> while we're having the conversation -- >> go ahead. go ahead. >> while we're having the conversation of disruption, a

thing that i find most interesting is that semiglue tieds replace people's appetites while mimicking hormones in the brains. they're also finding the kinds of foods that people crave. so people are starting to crave less prepackaged foods, replacing it with cravings for fresh fruits, vegetables and whole foods which means that now the conversation is about how it's disrupting the junk food industry. it's really interesting. >> joey, i'm curious. what percentage of your clients, if you will, the folks in your classes, especially let's call it on the upper east i had in new york or down on 20th street or whatnot do you think are actually on a glp-1 right now? >> i wouldn't even know where to start in terms of guessing the percentage of clients that are on glp-1s but anecdotally i have

two friends who live here in miami who are very close to me who never wanted to go to barry's and they both started glp-1s and now they do. i think maybe the percentage of barry's clients who have started in the last year is probably much higher than those who have been coming, you know, prior. >> and what do you think is going ton between the distinction between classes which is what barry's does and people who are training either on their own or at a gym or with trainers or remotely? i mean, there was a view just two years ago, three years ago -- >> don't remind me. >> -- in the post-pandemic world that it was all going to change. >> yes, that view, i think, has obviously fallen to pieces because there was a mad rush back to irl workouts and barry's has only seen substantial growth year over year. as an example we had 800,000 unique clients last year which is up 10% from the prior. we had 8 million visits in 2024,

which is up from 7.4 the last year. so we're seeing a tremendous amount of growth year over year, particularly in that year coming out of covid, it just was a full-on explosion. >> what happened -- there was also a view that you were actually going to lose instructors because they were going to become stars on their own and then they were going to go try to, you know, do it on their own effectively online. >> and that certainly happened. i think there was a point in time where talent, whether it be at barry's or other places were sort of exploring, you know, what they could do on their own in terms of building their brand, in terms of doing workouts from home. what we've seen personally from our perspective is that since -- if i were to guess a percentage, we have had around 70% or 80% of the instructors that left at least tried to come back to barry's. i think there has been just this return to trusted brands, to

having the in-person experience, right, with brands that they know, how to handle premium client experience, et cetera. >> before i let you go i have two investing questions. i actually know a guy who invests in sort of gym franchises and i've always been curious, you guys don't franchise, i don't think, maybe you do a little bit internationally. >> right. >> if you were not running barry's right now but you wanted to invest in the gym industry, if you will, how would you do it? >> i've never been a big trend guy so i would stay away from things that, you know, have just popped up and are super popular over the last couple years. i'm very back to basics which is what barry's is about and we are bless that had when barry's started the workout back in 1998, so many, many years ago, almost three decades, the foundation for it was hit. it's strength training, real circuit strength training with interval combination on the treadmills. at the heart of it is efficacy.

so i would stand behind a product that i know works, that i know can be scientifically backed and in which i believe in the founders and the human capital piece. >> okay. final question, there's speculation, there's been reports that you guys may be for sale. where does that stand? >> you will have to see. hopefully we will have news soon. >> okay. well, if you do come on back. thanks, joey. appreciate it. >> thanks. thank you so much. when we come back -- not when we come back. we're rolling here. it is 7:00 a.m. on the east coast. you're watching "squawk box" on cnbc. i'm andrew ross sorkin along with becky quick. joe is out this morning. new reporting just in the last hour, this coming from the "washington post" saying that aides to president-elect trump are exploring tariff plans that would be applied to every country but only cover critical imports. it says discussions center on imposing tariffs on sectors deemed critical to national or economic security.

so trying to make sense of what's critical and what's not is going to be the big new question. we will be speaking to former house speaker kevin mccarthy in the next hour about that news and so much more. president biden signing the social security fairness act. the bipartisan bill clears the way for increases in benefits for public sector workers like teachers, firefighters and policemen who also receive pension income. and united, good news for flyers this morning, planning to test elon musk's starlink for in-flight internet next month. it expects to begin offering the service on commercial flights this spring, united planning to outfit the entire two cabin regional fleet and have the first starlink enabled plane on major routes by the end of the year. looking at the futures this morning you will see up across the board dow futures up by about 165 points, the s&p futures up by 45, the nasdaq futures up by close to 220. let's get over to dom chu he has

a look at this morning's premarket movers. what's driving things today? what's the overall feeling for the market? >> sure. becky, andrew, good morning. we will start things off with a few analyst calls this morning driving some of the action, especially in some do you components. we have barclays upgrading boeing. analysts are seeing momentum on production, also deliveries and cash levels as well. potential light at the end of the tunnel after a very difficult year. barclay's is also upgrading citi group from an overweight to equal weight rating. boeing up about 2%, citi group up nearly that as well. also microsoft, salesforce and snowflake are being named top picks in 2025 over at piper sandler. analysts are seeing these three vendors as best positioned to capitalize on ai trends going into 2025. microsoft up about a percent. sales force down a quarter of a

percent and snowflake up 1.5%. abilityists are down grading goldman sachs. saying as capital markets recover the firm's reliance on the global banking and markets revenue limits possible potential momentum going into 2025. goldman shares just about flat in the premarket trade. head over to cnbc.com/pro. sentiment slightly positive, we will see if we can get over that negative santa claus rally period. uber, the company launching a $1.5 billion accelerated share buyback program. it says it expects the purchases to be completed in the first quarter of this year. you can take a look at that stock now at 66.67. it had been up close to 88 bucks at one point. let's get you the actual number.

there had been talk about these buybacks before but now it seems to be happening and maybe because of where the stock is relative to where it was. we are looking right now. yeah, i'm looking here. topped -- top tick was about 89 bucks, 89.94 it looks like. there is a story about uber and lyft gearing up for the revolution in driverless taxis, waiting to hear what happens on that, building out some of the infrastructure on that now. i was looking through the story. >> don't you think we are still like five years from that? >> probably from it being a common like every day, every one that you're ordering, but it's moving and moving quickly. >> in some cities. >> yeah. if you are an uber driver you might want to think about that, too. >> long term. >> yeah. all right. when we come back we're going to kick off the first full week of

trading with jason trennert. right after this break. what apple and microsoft are offering president-elect trump as we inch closer to inauguration day. "squawk box" will be right back.

all right. welcome back, everybody. joining us right now with his outlook on the markets for the year is jason trennert. he is the chairman and ceo of strategis research partners. by the larry david rules is it too late to say happy new year? >> i don't think so. i think january 6, the way the -- >> the way the calendar fell.

>> i think you can still say that. >> everybody is full-time back at work this week. >> yeah. >> looking at where things stand for the year how are you feeling about things? what concerns you? what are you excited about when it comes to the markets? >> you are not starting off with the greatest returns, if you are looking at the stock market, roughly 22 times earnings. >> right. >> and you are at 10 year treasury yields this morning i think they are about 4.60. >> just above it. >> anytime the 10 year treasury yield goes above 450 markets tend to have trouble. so that's -- it's going to be hard to realize real multiple expansion this year. the expectations are for earnings to be up about 12% to 13%. in my opinion that's probably the most you could expect from the market, but i also think it's going to be very choppy because you have the new administration that's trying to

do big things and whether they're successful in doing those big things will have a big impact on how well we do in the markets. doge is the thing in my opinion that excites me the most, excites our clients the most. >> the efficiency program that elon musk and vivek ramaswamy are going to be looking at, trying to make the government a little more efficient. what you just said, the idea of waiting to see how much gets done, earlier this morning we were talking with axios, mike allen. >> right. >> he was talking about this plan to try to do everything in one big beautiful bill for the republicans, to wrap it all together. i can understand the reason for doing that is correct thinking that it's easier as house speaker mike johnson has said to convince everybody to vote for one big republican bill than to try to convince them again and again to vote for these things, that you would see more defectors, but it also comes with an awful lot of risk. it could mean that you get no

points on the board. that nothing happens. >> that's certainly possible and i want to kind of stay in my lane here. i don't know. >> i just want the market's reaction. >> i think the -- >> are you good with waiting and hoping to try and get that big bill passed? >> i think so. >> would you like to see a win on the board? >> you know, listen, the market would probably rather see a win on the board in the short term but the potential positive impact would be much greater if you were able to get the big bill later in the year. that is what will be the tough part about this year. if you are serious about fiscal reform, it's hard to not break a few eggs, right? and i do think -- i don't want to point fingers, but the trump administration is inheriting some things, whether it was student loan forgiveness, whether it was the tga, whether it was the spr. they are inheriting a little bit of a mess i think on the fiscal side which if you want to correct those things it's not going to be -- it's hard to do

them, hard to correct them without pain. >> part of the argument for this was that you wouldn't want the tax cut bill to be the last thing that you're dealing with and working on if you've already spent a lot of your good will and have already had those things that come through but i always thought that that was the one issue that you might get democrats to support, too, who wants to say that they voted to raise taxes on americans. >> from a market perspective you would probably less less risk than risk as an american. >> you like the go big or go home? >> i think so. i really do. i think that -- my own opinion is also president trump's political capital is never going to be as great as it is right now, right? it's going to deteriorate as we know as we kind of get into the midterm elections. this is the time i would say strike while the iron is hot. >> is there anything you would take out of that list? the issue i think is there's going to be so much in there and

the number is going to be so high that if you are a fiscal conservative or part of the freedom caucus or something else you're going to say no mas. >> i'm very much of the view that growth doesn't create inflation, that actually inefficient -- inefficient growth creates inflation. if you are a supply cider and are doing things to create capital formation you can have higher growth and less inflation. so i'm not necessarily sure i necessarily agree with the freedom caucus on that score. if you are actually making a good faith effort which i believe they will to control government spending. of course, there are a lot of -- there are a lot of vested interests in washington, both republicans and democrats that do not want to see that happen and that's going to be the big tension this year. that's kind of the big kind of lie that a lot of people are for fiscal restraint and the fact of the matter is politicians are largely put on earth to give things away. they're not -- not to take

things away or to act responsibly. it's not really part of the job description. >> so let's get back to what you are telling clients for this year. if you are setting the scene the springboard may not have a whole lot of spring in it because of what we've already seen to this point, where do you put your money to work? >> i don't want to make this overly complicated. my own opinion is that i do think you have to stick with ai because as we've seen recently the capital spending -- if you get some sense that the capital spend something slowing that's one thing but right now your average ceo is more worried about not spending enough on ai. more worried about getting fired for not spending enough than spending too little. so i think that's going to happen. i think energy deregulation so certain parts of energy, particularly lng, pipelines, lng iks ports i think they will do quite well. financials i think you're going to see a lot of financial deregulation there. i think the other big theme is

this idea of an industrial power renaissance where if you look at what we're expecting of the grid in the united states between artificial intelligence, electric vehicles, cryptocurrencies there's almost no way you can do this without in my opinion leaning into fossil fuels or nuclear or also making big improvements in the modernization of the grid. so in my opinion that's another angle on artificial intelligence in my opinion that there's probably still some room in that trade. >> with interest rates rising as you mentioned above 4.6%, what does that mean for this transition where you had the mid cap stocks that were starting to pick up, the russell 2,000 has come under some extreme pressure. >> listen, you know, i have to say when we were talking to people about small caps we're saying stick with high quality small caps, s&p 600 versus russell 2,000. the problem with qe for 16

years, 15 years in my opinion is that you don't have a real business cycle. you never cleanse the system. so the time to buy the russell 2,000 is when you've actually had a recession and you clear the decks and then when you come out of recession actually it kind of -- the lowest quality companies tend to rip. the problem with qe is that you never have -- the recession we had after covid was -- during covid, they said it lasted two months. the bear market associated with it lasted three weeks. you are not doing the things that the creative destruction part -- no one wants a recession but it's part and parcel of having a free market in my opinion. it's a long-winded answer to say i want to stick with companies with cash flow, companies that have earnings. i'm not advising -- we are not advising people to go pioneering in long duration stocks. >> jason trennert, thank you for coming in this morning. >> thank you very much. my pleasure. coming up, there is a chill in the air, did you feel the

chill in the air this morning? >> yeah. >> but natural gas prices they are hot, hot, hot. we are going to talk about that after this break. then former boston fed president on the latest fed speak ahead this have week's big jobs report. we will find out if the jobs report is big or not. "squawk box" coming right back after this.

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we've got some breaking news for you. disney and streaming provider fubo tv nearing a deal to combine online live tv businesses according to a bloomberg report citing people familiar with the matter. disney would fold the hulu business into few bow. the deal would only include the live business not the subscription video business which includes the catalog of non-live content available o stream. as part of this deal fubo would drop legal claims against venue sports. the report says the tie up could

be announced as soon as this week. shares of fubo up sharply on the back of that news. you can see it right there, up about 15%. we should note its market cap before today's move was just $481 million. and a couple of other things, this service competes with youtube tv, this has a lot to do with the bundling or unbundling of cable television. >> sports. >> this is effectively the -- this is the -- this is the bundle, what we are talking about is a bundle of services with sports. the bigger question -- now, if you remember this three-way tie-up on the sports side -- >> warner brothers. >> also with warner brothers, fubo was trying to block that. >> saying that it was not llowing competition. >> correct. >> it was going to be 70% to 80% of the sports that would be going through that three-way tie-up and that this would squeeze out the other competitors. this sounds like if you can't

beat them join them. >> the question i have is whether regulators decide, okay, this is fine, too. and that whole deal had sort of broken apart or at least been stalled or temporarily stalled out because there was this view that it just could not go forward. >> part of that view that was being fueled by the companies like fubo who were complaining about this. >> exactly. so i don't know if this fundamentally changes that dynamic or not. >> you also have a new set of regulators coming to town at the same time, so i guess they will look at that pretty closely. i tried fubo for a while. >> yeah. >> just to get basketball games. it's really expensive. so didn't last in our house, but they had some really good games, i had access to them. all right. january is forecasted to be one of the coldest months in several years with more than 200 million americans expected to see below average temperatures. natural gas prices ran up more than 30% heading into the new year and joining us to talk

about the sector right now is the energy aspect founder and director of research. first of all, thank you for being here to talk us through some of these things. people think it's really, really cold, that means a lot more natural gas is going to get used, but your perspective on this and explaining a lot of this is that it also means that production will be tougher in some places. why don't you lay it out what's happening here. >> yeah, thanks for having me. happy new year to everyone as well. like you said, i think of course we are expecting additional gas demand potential over 120 bcf but the key focus is how much production do we lose mostly in the appalachia. the weather run is a little warmer versus next week. we are still expecting 25 to 30 bcf of production losses across the u.s. most of that will be the appalachia. last january we lost 55 bcf, you

know, back in the day when tfk another winter storm we lost 150 bcf. the losses this time around are smaller than some of the bigger ones but it's not in material. the price rise is justified, the market has been pretty bearish. if the cold as it currently stands it's kind of spreading further south so it shouldn't be disrupting more production but you never know. these weather fronts do shift and there's going to be an upside to our 25 to 30 bcf number that i just mentioned. >> part of what i always think of with natural gas, i guess liquefied natural gas is part of the issue, too, but what's happened in europe, where things stand with germany, the huge reliance that they had on russian natural gas and how the market has been changed and disrupted post the russian invasion of ukraine. how do you sort this out from where we were just a few years ago and what the whole future looks like over the next year or so? >> i mean, it's a paradigm

shift. we have been calling for russian force in ukraine to stop. we have had a lot of push back and that materialized over the last few days as well and therefore we do think there is upside to european gas prices as well as a consequence of that. but the negative of course of this is that we have seen about 15% of european gas demand, industrial gas demand, being lost forever because of higher gas prices than in the past. we've also seen ira from the u.s. attract more industry to the u.s. i think u.s. has benefited indirectly because of this and europe faces both higher costs but now also lower demand structure as a result of the russian invasion of ukraine and structurally higher gas prices. >> the upside in the united states on that industrial front, you think that's long term?

it's going to continue to grow? >> look, we have to wait for what president-elect trump does with a lot of the ira, but we do believe that it's not going to be a blanket, you know, revoking of everything that's there. a lot of the policies are focused on america first. i think tariffs do complicate matters, ults tariffs are negative for global growth even if ultimately the aim is to boost u.s. growth, i think that is going to be a tough one to decipher before we have the full details. ultimately the u.s. does benefit from cheap feedstock prices there is no two ways about it, particularly natural gas. so i think industry will flourish in the u.s., anything that requires cheap energy u.s. has a massive advantage over europe. >> just in terms of the u.s. consumer watching natural gas prices up 27% over the three months i think it's estimated that something like 65% of homes in the midwest use natural gas

for heating. what's this going to look like for the consumer here? >> of course it's a hit for the consumer but we should also remember that natural gas prices have been at rock bottom. in the grand scheme of things the same thing comes back for oil and gasoline prices as well. people talk about the rate of change which is of course fair when prices do go up a fair bit and quickly, but we have to remember, i mean, natural gas prices fell so low it was almost like a dollar per mmbtu not that long ago and we have seen consumers also deal with $11, $12 in the past. yes, the percentage increase in some ways looks very high but also looks very high because it's coming from a very low base. i do think in the grand scheme of things it's not going to actually be that detrimental for consumers because the outright price is still very low based on historical levels at least. >> we have to run. wti just below $75 a barrel right now. what's your guess for where prices are headed over the next

three to six months? >> again, it's been a quiet rally for crude as well. wti almost at 75, was below 70. we think brent will be at about $80 average for this year, wti is about 77. we do think there's a little bit more upside. inventories are very low. look at cushing stocks, inventories have ended 2024 at the lowest levels ever for this time of the year and i think people should be concerned about just how low stocks are. >> thank you. really great to see you. >> thank you. coming up, we have some big tech sending warm wishes to the incoming trump administration. we're going to talk about what's going on, what it all means after the break. and a quick note about tomorrow, we've got an exit interview with outgoing ftc chair lina khan. we're going to talk about everything that's happened over the last four years. "squawk box" comg ckig teth.sinba rht : ichi, ni, san, shi... (1,2,3,4 . . ) ruri: ichi, ni, san, shi... (1,2,3,4 . . ) hina: ichi, ni, san, shi... (1,2,3,4 . . )

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welcome back to "squawk box."

apple and microsoft courting president-elect trump ahead of his inauguration. steve kovach joins us now with more of the deal. seems like everybody is courting the president. >> these are just the latest of the two courting trump ahead of the inauguration day. this is microsoft and apple ceo tim cook, even offering different things. it might not be the end we hear about cozy relationships. cook is donating $1 million to trump's inauguration, comes ahead of trump's promised china tariffs which apple needs to dodge. also on friday brad smith put out a lengthy blog post promising the company would spend at least who $40 billion i development, mostly for ai data centers not necessarily creating a ton of jobs. going to be a lot of buying nvidia chips as well. smith mentioned trump a total of nine times in that blog post and included a bunch of praise for his 2019 executive order on

artificial intelligence. so let's talk about what's at stake for each of these. apple first of all. tim cook's donation what that could possibly get him. tariffs, trump promising up to 60% tariffs on imports from china although the "washington post" this morning reporting that may not happen for every single good coming in. those universal tariffs right not be as universal as originally thought. no comment from apple on what's going on here. they are not saying if the company itself is donating or if this is just a personal donation from tim cook. though what's the difference really there? trump has said cook had dinner at mar-a-lago with the two of them before the holidays, just a few weeks ago. unclear what was discussed there. microsoft on the other hand provides a lot of tech services for the government and recently come questions around how serious it takes security that follows recent breaches of state department emails by chinese hackers. microsoft has since said it's going to make security a top priority. microsoft is facing some legal challenges related to its stake

in openai, that lawsuit from elon musk plus some investigations from regulatory agencies. not the only notable names of course in tech donating to trump's inauguration, you have sam altman donating $1 million to the inauguration, as are meta and amazon. uber is donating $2 million, $1 million from the ceo and another million from the company itself. of course elon musk spending over $270 million to help trump get reelected. guys, this seems to be -- >> becky and i were talking about it in the last hour. >> andrew had a good point. >> in the old days. >> eight years ago. >> i have a suspicion but maybe not fact that the defense companies, some of the banks, others, were doing this because they were traditionally -- >> they were the contractors. >> regulated and they were trying to figure out how to curry favor, let's call it what it is, but that was sort of a normal course of business. these are the companies today that are in that business,

meaning they are the ones that are going to need help from the government or not as it relates to regulations. now, it would be very interesting to see does this go on for whoever is the president in 2028 and '32. >> but it wasn't with biden. >> that's the question. >> we know that trump is so much more transactional, we also know what happened during the first term. look at jeff bezos and look at his relationship with trump in that first term, the whole contract for cloud services, that kind of got knocked down, bezos ended up suing. remember the whole u.s. postal service thing with bezos and trump, too. a lot of that talk and it just became a big headache. i think these guys are realizing with he should do what tim cook did in the first term and cozy up right up front and trump could probably make our less a little less miserable than he did the first time. this seems to be the cost of doing business now with the trump administration. you literally have to pay. >> what do you think about the distinction between some ceos paying themselves and some -- >> i don't see a distinction.

>> -- companies paying? >> tim cook represents apple just like you could argue you represent cnbc when we are out in public doing things. there is a reason you and i aren't allowed to do certain things. i see less of a distinction between tim cook or sam altman personally donating. they are their companies. it's very obvious what they're doing. >> why do you think that some are doing it personally and some are doing it as a corporation. >> apple usually doesn't donate politically. >> from that perspective the idea of saying i'm going to donate but not take shareholders' dollars to do it. >> that's probably the thing. >> if you have not used company money to -- >> do it in the past. and there's also a reason i think it's interesting, apple is not talking publicly about this. that dinner at mar-a-lago apple completely silent about what was discussed, apple completely silent about this inauguration donation from tim cook. they don't want to touch this or openly admit that this is

actually happening. i think that speaks volumes as well because they know it's kind of icky. it's interesting to see this change from so many of these people after eight years. >> icky. >> icky. >> icky is the new practical. steve, thank you. we will have a lot more on big tech and the markets at the top of the hour with portfolio manager dan niles. when we come back, former boston fed president eric rosengren on fed speak and this we'sobnuerek js mb. "squawk box" will be right back.

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welcome back to "squawk box." the december jobs report due out friday is going to be a critical piece of data ahead of the federal reserve's meeting at the end of the month. joining us is eric rosengren former boston fed president. eric, good morning to you. let's talk about what you think we're going to hear towards the end of the week and then let's get into the mindset of what you think jay powell is going to think about it, if you will. >> so for the labor report, i don't think there are going to be many surprises. i think we're still going to be pretty close to around full employment, 4.2%. payroll employment will come in a bit under 200,000 but i think the real news is actually not coming from the data from

december, but really what happens with tariffs and immigration policy once the new administration begins to make their decisions about what exactly the policies are going to be in those two areas. >> so that's the big question, though. we were talk about this "washington post" reporting as it relates to the administration, tariffs in particular, this idea that there's going to be tariffs across the board for what they are describing as critical items to our national security. how that's defined i think will be the big question. how do you think the federal reserve is supposed to think about all of this and are they supposed to think about this ahead of any action or not? >> so the fed is going to be driven by data and right now the core inflation already is pretty high. so if you look at the pce we are at 2.8%, if you look at the cpi we are at 3.3% and the fed's own forecast was that at the end of this year we're still going to be only at 2.5% for both total

and core. so just based on the data it makes sense for the fed to pause, but the fed does have to make a forecast. after the inauguration there's presumably going to be more information about what the nature of particularly the tariffs are going to be. while the fed is driven by data the data is likely to be driven by some of the fiscal actions and those fiscal actions in the short run are going to be driven by tariffs and immigration, in the longer run we will see the benefits potentially from deregulation and lower taxes. it will be good news if the "washington post" article is correct and there's going to be more flexibility on the tariffs, but i think it remains to be seen. >> eric, the thing that i can't figure out, though, about that strategy, if you will, is that whether that by default means the federal reserve will be late. i'm not saying it doesn't be data dependent but by default you're suggesting that you can't really put into the mix of

thought what this tariff situation is going to be which maybe you can't because we don't know, but it also means that you're going to have this lag effect and you're going to wait and whatever happens they're behind the eight ball. >> yeah, i think most fed -- i mean, as the chair said in his press conference, many of the members did incorporate some movement related to what fiscal actions were likely to be but i think you probably keep it at a relatively low number until you have some specifics as just your last session just highlighted, there's some uncertainty even with china which is probably where the tariffs are most likely to go up. the administration has talked about 60% tariffs. those are very significant. enough that it's going to start causing a supply shock and cause people to really rethink how they do the supply chain. that doesn't change in just a quarter or a couple of quarters. that's going to be a major shift

if people think this is a more permanent effect. >> in terms of the employment picture, and i know you said we are not going to have any surprises, if you were to look out over the next 12 months, what do you think employment looks like in this country given all the things that we are talking about, doge and everything else? >> so, again, it's very hard to determine just because the policy on the fiscal side has not really been clearly described, but in terms of the immigration policy, if a large number of people are deported, it's going to cause people to move to places they think they're less likely to be deported and it's going to cause some shortages in places where labor for immigrant -- by immigrants is particularly important. so construction, personal services, food preparation, food in general i think are all going to be areas that would be

affected. in terms of the ariffs, it's a distortionary tax and depending on where the tariffs are determines how much of a distortion there is and what industries are most affected. so i think we at this point have to just wait and see. it's not that far until the inauguration so we're only talking about a couple weeks more and we should be getting some more information. >> eric, thank you for your smart thoughts. i hope we can have this conversation in a couple weeks when we do know a lot more and we can get your thoughts on all of that as well. >> nice to see you. thank you. when we come back, news on the doughnut front. uh-oh, listen up, andrew. >> i know. i know. >> it is crazy good. we will have the details for you right after this break. right now, though, as we head to the break let's look at the chip stocks after foxconn reported record revenue overnight. asml up by about 5.9%, taiwan

semiconductor up by 4.3%. we will be right back.

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welcome back to "squawk box." east and gulf coast longshoremen threatening to strike in just over a week with talks to resolve the contract dispute expected now to resume tomorrow. joining us to discuss potential supply chain impacts is carlos gutierrez, the former secretary of commerce, also a cnbc contributor. i want to get his views on tariffs and everything else going on. in the short term we almost had a strike before with longshoremen. what do you think is really at stake here? and how quickly do you think this can get resolved? >> well, i think the

longshoremen have won and it's a matter of whether we need a strike to confirm that. we probably do. i don't think management can just, you know, call it quits without a fight. but i don't see any big changes in technology or the contract. there will be delay, you know, we can't expect a strike to happen on the eve of the inauguration. so, yes, there will probably be a short strike but in the end i think the longshoremen have won this one and we will just move on, you know? >> here is a larger question in the context of labor in this country. how do you view president-elect trump and his relationship with labor and with unions as we move forward? i mean, are we going to see more of this and will he be supportive of them or not? because it's been very mixed over the years and clearly there's been maybe even a little bit of a shift even in the last six or eight months during thinks campaign. >> yeah, i think that's a great question. you know, on one hand there is a

link between the doctrine of america first and unions. you can make a case for that, but i don't think the president is making broad policy. i don't think he's saying that he will always side with labor versus technology. that's a very big statement. i think what he's saying is in this specific case he believes the longshoremen are right. it's interesting that the argument was probably made that the profits are going to foreign companies and, you know, foreign being the keyword. it's really not about foreign companies. if u.s. companies were running these ports or operating these ports it would be the same thing, the money would be going to them. you know, so the reason there are foreign companies is because there aren't u.s. companies who manage ports on this scale. it's a very difficult business, the business with a lot of expertise required, built over decades. so, you know, the foreign aspect isn't really the key issue. but this is an issue that's going to come back up, is it

technology versus labor and how do we deal with it without it being binary? it's either one or the other or we go on strike. i think it's important to watch. >> carlos, i want to talk about tariffs with you and the role of inflation, there is a "washington post" piece out this morning talking about how the president is going to implement tariffs across the board on what he's describing as critical national security items. the question is what's going to be considered within that construct. how you think, a, that may impact inflation across the board but also if you are a ceo of one of these big companies and by the way maybe you just need to donate to the inauguration, but what you're going to have to do to get off that list. >> well, look, i think that's an important point. there's a case to be made that the way to approach tariffs is surgically, by industry, by product, in some cases by company, whereas across the board will have consequences that are self-inflicting.

self-inflicting damage. especially if we want to, for example, if we want to move supply chains to ex mexico, it would be self-defeating if we put tariffs on products that are being moved to supply for mexico. there has to be an analysis and it has to be a bit more strategic. i do think that it points towards specific strategic products, industries, companies as opposed to across the board. there are too many things that fall through the cracks when you do across the board. you know, just on supply chains, these are things are so complicated, it's easy to say let's bring supply chains home. you talked about apple a little while ago. their supply chain has come out of china. you are talking about hundreds of components coming from different countries that all congregate in china for assembly. that cannot be replaced overnight. in fact, it can't be replaced in years, in decades. so these things are going to

take time and a lot of analysis, a lot of work and if we want to facilitate that then i think we need to be more selective about tariffs, especially in countries like mexico where they -- or vietnam where they will be recipients of supply chains. >> carlos, i want to thank you for joining us this morning. >> pleasure. thank you. it is just after 8:00 a.m. on the east coast and if you are watching "squawk box" right here on cnbc, i'm becky quick along with andrew ross sorkin, joe is off today. among our top stories this morning, nippon steel is accusing president biden of exerting undue influence over its attempted $15 billion merger with u.s. steel. biden blocked that deal on friday. in filing two new lawsuits nippon steel says that biden caused the committee on foreign investment in the united states to fail to conduct a good faith review process of the deal. nippon says that it's still confident that it will close the transaction. we'll see.

disney and streeping tv provider fubo tv are closing in on a deal to energy their on line live tv businesses that's according to a bloomberg report that says that as part of the deal fubo would drop its legal claims against disney, fox and warner brothers discovery over their venue sports streaming service that combines all three of them. and aides to president-elect trump are looking into implementing tariffs on every other country but only on imports critical to national or economic security. that's according to a "washington post" report. it would represent a big change from trump's campaign rhetoric. the report also says that these are talks that are still in flux. we will talk about this at 8:30 a.m. eastern time with former speaker of the house kevin mccarthy. take a look at futures, we have green on the screen on this monday morning, the dow up about 170 points, nasdaq up about 222 points, the s&p 500 up 46 points. we will show you treasuries.

the 10 year note sitting just about 4.5, call it 4.6, the 2 year at 4.262. mike santoli is down at the new york stock exchange and this morning he is weighing the chances of another banner year for the markets following two consecutive 20% gains in the last two. can it be a three-peat, sir? >> well, andrew, you would have to say it's possible because it has happened before, not since the late '90s but it probably would have a lot of things that need to break right. you have a lot of bullish sentiment at the outset and a lot of the big names in the market have to corporate. a do year chart of the s&p 500. the ratio of reward to risk was very high, it's hard to know if we can really expect anything like that again. you had 23% gain, only had to sustain about an 8.5% drop along the way. what happened here, approximately two years ago, inflation had decisively peaked and the ai story really started

to come into its own driving up the nasdaq. if you wanted to just sort of say, okay, what's the overall trend, that's the angle of assent. we had this stealth pull back in december, important groups like industrials, banks, small caps down 8%. that was a pretty good reset. friday we finally had response to that, oversold rally. we will try to continue that today. we will see if there's traction. take a look at the ratio of the nasdaq 100 to the equal weight s&p 500. so this is kind of mega cap tech relative to the average large cap stock. you see obviously this was a massive peak in relative performance toward the middle of last year, the market broadened out which meant that the average stock did a little better relative to the nasdaq 100 and a resurgence again in the last month or so. if we're getting to 20% gains it's got to involve these stocks, the math gets very hard when you have seven stocks worth 30% of the s&p 500 and you say, oh, maybe they're not going to lead the way. then you have 70% of the market has to get the overall index up

more than 20% or even to 11% which is the consensus strategist target for this year, it becomes very difficult. take a look at rates, this has been one of the psychological headwinds, rates going up even as people are questioning whether the economy is accelerating. this is the yield on treasury inflation protected securities on a 10 year basis. it's known as a markets estimate of real yields. we're kind of at this key threshold here or at least one of them. 2.25%. it's a pretty good deal. 2.25% above inflation. this is, though, somewhat of a restraint on the real economy. does it mean that the market is saying that under the new policy mix we're going to have a faster growing economy or that so much debt is going to be issued by the government. you need more compensation for it. it could be some combination of those things but we're at this level where it might start to test equity valuations and flows, but hasn't happened so far this morning, guys. >> let me ask you it this way, then. what do you think the markets

will be looking at this week effectively to test the overall 25 bull case? >> yeah, i mean, first of all, you know, we have this speech by jensen huang at ces, nvidia's ceo. i want to see if there is real fatigue with the ai story because nvidia has not been able to break out above its geun-hye. microsoft has been dead money for 11 months. you want to see if the market is going to be able to seize on the same old theme on ai. finally the jobs number, i do think the market craves confirmation that the jobs market and economy remains in good shape. we don't want bad news to bring in more fed easing. i think those two things will probably help fill in some of the blanks this week. >> mike santoli, thank you. appreciate it. joining us right now for more on the markets as we get ready to kick off the first full week of trading in 2025 is dan niles from niles investment managing, he is the founder there. dan, what do you think about what mike santoli was just

laying out, this idea about levels that need to be tested, things we're going to be pushing on? how are you feeling about the year? >> i think q1 earnings and guidance is going to be key to this because you've got a lot of things that need to get taken into account. the first big one honestly is at the end of q3 the u.s. dollar was at 1.01, it ended the year at 1.08. so you have a 7% move in that and you are going to have guidance that a lot of these companies are going to give either for the full year or first quarter and s&p companies get about 30% of their revenue overseas. for the magnificent 7 a lot of their revenues it's closer to 60% overseas. you're going to have to deal with that. the second part is some of the calendar shifts you're seeing they shouldn't really matter but you have easter moving out from the end of march to april 20th and so for companies that only

guide a quarter in advance, et cetera, you may have guidance below expectations. so you've got a lot of things that i think it's going to be interesting to see how stocks react to this guidance and multiples are really high, let's not forget, we are exiting the year at about a 25 times s&p 500 pe, you go back through history and when cpi is between 2.5% to 3% the trailing pe is closer to 19 times. so valuations don't give you a lot of room to maneuver and so that's why i think this year it's like one of the widest range of outcomes i can think of and i think it really hinges on the path of inflation in terms of whether that multiple can hold or it contracts by 20% to 30%. >> so last year at this time you had top picks like amazon, meta, texas instruments. i was a little struck by your top pick, you have five top picks but the first one you listed was cash. when is the last time you did that? >> the last time i picked cash

was in 2022 and the market ended up going down 19%. yeah. we will see how this year turns out, but i think especially to start the year you're going to get a 4% yield in money market funds if you have cash. i don't think that's a bad place to be. now, if you go through the rest of the picks, there are individual stocks that i hope can get through even if the market goes down 10% to 20% this year which i think is possible. i think the upside is up 10%, but i look at cisco where we think you're going to have the last two years you've had ai spend to build out that infrastructure, i think this year you're going to have companies wanting to get to that data, move that data around, network that data. ad tran is helping companies bring fiber to the home on the telecom side. british telecom, deutsch tell

come in europe is doing that. in the u.s. you have bead funding to bring community to underserved communities. those are going to roll out in the middling of this year. i like the bank stocks because with the new administration, less regulation, tax cuts, that should really help those stocks. don't forget 2023 we had to deal with the bank failures of silicon valley bank, first republic, signature. even though the s&p is up 23% or so over the last three years, the bank etf, kbwb is down about 4% over that same period of time. the final pick is the mid cap value space because, you know, you go back to covid, a lot of infrastructure spending there. then the last two years spending on ai infrastructure and the mid cap space has just been sort of left for dead as all the money has congregated into seven stocks and so you've got mid cap, small cap value names trading at 17 to 18 times,

trailing with the s&p sitting up at 25 times trailing and they've underperformed by about 35% to 49% over the last five years relative to the s&p 500 that's up 82% and just been left for dead. i think this year especially if we do get a pause in ai spending, which i expect by about midyear, i think a lot of that money is going to come out of the magnificent 7 and try to go into these other areas of the market like small and mid cap value. >> the big argument against small cap in particular has been as interest rates rise they're going to have a tougher time, they're not going to get those hoped for eventual lower rates that you've already seen bigger companies able to qualify for. things could get a little tougher sledding. jason trennert was here just a little bit ago and he said that he would stay away from those stocks for this moment because he wants to wait until after there is a recession, that's when you jump into those stocks. >> that's why mid cap value is

our top pick or one of the five top picks that we're looking at. >> right. >> they are a lot more defensive. if you go back and look at what happened during when the tech bubble broke or during that '22 period of time, they held up a lot better than the market. because they're bigger than small cap names they send to have better profitability, better ability to handle it if rates do go higher. that is one thing i'm definitely looking at because the other side of, you know, when cpi is between 2.5 to 3% you normally have got 10 year treasury yields if you look back in time over 100 basis points than where they are today. i can definitely see a situation much like in 2022 when you lost money in bonds and lost money in stocks if inflation really picks up because don't forget these pro growth policies are wonderful, but the other side is you have low unemployment sitting at 4%, the economy is already growing at 3% and the

policies coming in are pro growth for the u.s. but they're also somewhat inflationary, such as immigration policies or tariffs and so i think you really need to watch that and the market really cares as you saw when jerome powell said our inflation forecasts have, quote, kind of fallen apart and the market dropped 3%. so to your point, becky, that's why i think mid cap is a better place to be than small cap which is why we went with the ijj as one of our top five picks. >> dan niles, another of his top five picks is cash. hasn't done that since 2022. thank you, dan. >> thank you. coming up, former house speaker kevin mccarthy we will talk to him about this new tariff plan we are heading about in the "washington post" this morning. and also this story coming up, what could a disney fubo tv partnership mean for the streaming landscape and the venue sports service that three of the biggest players are trying to launch?

rich greenfield will join us in just a moment to talk about this breaking news this morning that could reshape the television landscape. you're watching "squawk box" and this is cnbc.

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welcome back to "squawk box." netflix one of the big winners at last night's 82nd golden globes, the streaming taking home the top prize for best film, comedy and musical or amelia perez, it tells the story of an american drug lord who undergoes gender affirming surgery. best drama film went to the post-war epic "the brutalist." the film blocks clo, in at more than three and a half hours but the globe's win puts it on course to be a major contender at this year's academy awards. disney and streaming provider fubo tv are nearing a deal to combine their online live tv businesses according to a bloomberg report citing people familiar with the matter. shares of fubo soaring on that

report up about 68%, less than a dollar to $2.41. as part of that deal fubo would drop its legal claims against venue sports, the joint sports streaming venture by disney, fox and warner brothers. joining us is rich greenfield an analyst and partner at light shed. obviously not a done deal at this point. is this something that would clear the way for that sports venture to go through or are there other authorities that might get involved? >> look, at the end of the day bob iger is a pretty amazing dealmaker. i think he very much believed in venue sports, i think there was a tremendous amount of frustration among disney as well as fox and warner brothers executives about the way the lawsuit was going. i think they weren't in a great position on appeal. so this becomes a very elegant solution to solve two problems, one, becky, you know, hulu live tv was not a good business.

disney was in it to sort of help espn but within the bundle but now that espn is going direct to consumer in september of 2025, this year, they don't really care as much about the linear bundle and so exiting the money-losing hulu live business, extending that to fubo, letting them deal with the fact that, you know, the on line or virtual cable business is not a great business, seems like a pretty -- sort of a win-win for disney. they get out of their not so good business and they help the venue sports joint venture actually get off the ground. i would put this into sort of a double win for iger in terms of coming up with a very elegant solution to this problem. >> rich, two questions. one is do you think -- i mean, there is the lawsuit which is what's keeping this venue service from moving forward right now, but how do you think regulators, could they independently be looking at this in a different way? >> look, that's obviously the unknown. the judge was clearly very clear

that, you know, she saw major issues with this. the question is, you know, you've got a change of administration, right, so like the timing of this may not be a surprise, right? like you waited until the biden team is sort of on the way out, the trump team is on the way in. is this an issue that the trump, you know -- whether it's doj or ft -- i don't know which agency would take this on. doj wrote a brief -- the former doj wrote a brief in support of fubo, they are obviously on the way out. my guess is that there isn't really a catalyst to bring this back into the -- back into a lawsuit. anything is possible, but my guess is this will clear the way without fubo and, remember, directv was silenced because they got a deal done with disney. i'm not sure there is a catalyst to keep this lawsuit going or another version of this lawsuit going. i certainly sit here today looking at the news and if this happens i think venue sports probably launches over the course of the next few months.

i mean, they're ready to go, they have hundreds of executives sitting on the fox lot where the tech was based, they're ready to go as far as i know. so if this lawsuit gets cleared you might see this happen very quickly. >> so if that is the case, a venue does get launched, what does that mean? who are the losers in that potential setup? what's the competitive field look like? >> well, look, the unknown, becky is from the very beginning venue was always a let's get this started with fox, disney and warner brothers programming and let's try to bring in more programming over time. there was sort of an expectation that, you know, hey, david ellison is coming into paramount and will own cbs, maybe there's something to do there now that the new team from red bird is sort of flowing into cbs. i don't know. i mean, look, s it stands today i don't think venue is a massive business, only having sort of, you know, less than half the nfl, you know, part -- they're going to have all of the nba

this year, but then they lose half the nba when the turner stuff goes over to amazon. it's not a -- i still think that the sort of headwind facing venue are pretty significant in terms of how big of a service it can be, but, again, if you are sitting there at disney, fox and warner brothers, every subscriber you get is good because you're actually laying off -- you don't wear the cost because you only own a third of the joint venture but you get 100% of your distribution fees from venues. it's a very elegant solution to helping your linear business in a time when everyone is looking for smaller bundles, cheaper bundles. so this seems like a win for disney, fox and warner brothers. >> rich, a couple of questions. this is a big win for the chair of fubo, it seems like. i was unaware -- so hulu -- you're saying hulu tv or hulu live loses money.

does youtube tv lose money as well? >> it's hard to know. i suspect it doesn't make any money but, remember, youtube tv has a far larger goal of bringing in youtube content and merging those two platforms and bringing advertisers who weren't youtube advertisers into that youtube ecosystem. there is a much greater sort of bi-level purpose for why youtube tv exists. you know, the getting to scale piece of it has made a big difference, you know, there's -- you know, you have almost double the subscriber base at youtube tv than you had at hulu live and combining fubu gets you a little closer but you're still trailing by millions of subscribers. i think that relative scale is pretty significant, andrew, when you are looking at the cost structure. look, this doesn't fix the overall problems. youtube is part of google. there is a much larger purpose to youtube tv.

fubu -- >> deeper pockets. >> it's still a pure play online video service that is going to face meaningful headwinds long term. >> rich, long term do you see venue becoming a place that brings in a whole bunch of other partners, whether it be amazon, which obviously will have nba rights, whether it be nbc, whether it be -- r do you see a bunch of these sort of mini bundles that are in some ways even competing with each other? >> andrew, i think the only way that venue can be really successful and what i mean by really successful meaning 10 million plus subscribers, the only way you're going to get to that type of real scale and probably even potential of real profitability is you're going to need more content, meaning you're going to need to have a fuller offering which means comcast, brian roberts, which means, you know, david ellison and paramount are going to have

to play ball with venue. whether that happens, i don't know. you know, only owning a part of the ecosystem and there's definitely some tension, starting venue did not sit well with brian roberts, did not sit well with the team over at paramount. obviously they are on the way out but bringing everybody on board, that will be critical to whether this is actually a meaningful service. >> is there a lesson -- is there a lesson in hulu? meaning if you go back and think about the creation of hulu, that was obviously a whole bunch of folks getting together and for a long -- >> and disney wasn't part of it. disney wasn't even part of it at the start. it brought in disney, at one point it brought in warner brothers, it brought in more and more partners. that's what you need to do. can you convince everybody to play ball given everybody is sort of out for their own interests? andrew, we don't even know if fox will look like fox in a year given the litigation going on in nevada. there is a lot of moving piece he is over the course of the next 12 to 18 months but i do think to answer your question

very clearly for a venue to be super successful it's going to need more of the nfl, it's especially going to need cbs. i think that is the linchpin to making this more successful. >> how do the leagues -- we really have to run, rich, but how do the leagues feel about this? >> the leagues were not terribly happy because they don't want people subscribing to only part of the sports content. whether it was roger goodell or adam silver, i don't think any are excited about this as it currently sits today but to andrew's point does this look much, much different in 18 months than it looks today? that's the big -- and multibillion dollar question that needs to be answered. >> okay. rich greenfield, thank you, rich. >> thank you. when we come back, can president-elect trump deliver for the crypto community that helped put him in office? we will talk about which campaign promises are achievable. stay tuned, you're watching "squawk box" and this is cnbc.

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welcome back to "squawk box." bitcoin up more than 40% since donald trump's election win in november, many in the crypto community enthusiastic for what they hope will be a more friendly environment for crypt foe under trump. joining us is the head of legal and government affairs at trm labs. good morning to you. i think we're all trying to understand what it means to have a more friendly regulatory environment and sort of how that will, therefore, manifest itself in some of the valuations we're seeing, ari. >> first of all, good morning and thank you so much for having me. yeah, it's -- there were a lot of promises made on the campaign trail, we're slowly seeing politics come to life. the adage in politics is that the people are the policy. since the election we saw several key appointments really across the cabinet from scott bessen as treasury secretary, paul adkins at s.e.c. chair, we

have a crypto czar or we will have a crypto czar david saks an entrepreneur and former paypal executive. if people are the policy we're seeing people up and down the cabinet who have been supportive of digital assets, supportive of innovation, ai. there's this excitement and i think sort of cadence of almost a space race where the u.s. is now in a position to keep up with the rest of the world or even surpass the rest of the world and so far we have seen a number of key appointments of folks that support innovation in the digital asset space. >> arie, if you look at bitcoin close to $100,000 now, what happens? meaning how is it going to trade in the future? do you believe it becomes some kind of true electronic currency? what happens that actually brings value to all of this? >> that's a great question. i mentioned the people and the real question next is sort of what happens from a policy

standpoint. we have heard a bunch of different suggestions to include a strategic bitcoin reserve, but i think what i'm really most excited about is even beyond bitcoin. over the last few months we have seen fintechs like stripe and cash app and others across the ecosystem use stable coins at scale for payments. right? we're actually seeing the technology used. i think bitcoin traditionally has been this investment mechanism or store of value but what we're really seeing a people start to use the technology for cross-border payments, for remittances to buy things. i think that's when we're really going to see this ecosystem grow when we talk about digital assets. on the one hand you have bitcoin, which has been i think this really incredible success story and even in more bolstered by the election, but i think what we're really seeing and i'm most excited about is the technology being used in a meaningful way for cross-border payments and beyond. >> you have a view on what bitcoin ultimately is going to

be worth? is there an ultimately? >> i don't. you know, i think we're going to see it go significantly higher. i think things like a strategic bitcoin reserve in the united states and it's not just the united states, i think when countries around the world look at the election, look at some of the campaign promises and look at what the trump administration is already doing, i think we're starting to see other countries and even states, i spoke to folks from texas recently that are looking to build a strategic bitcoin reserve. i think we will see it go significantly higher, but i'm a former prosecutor, not a guy who is going to make predictions on the ultimate price of bitcoin. >> we should have a larger conversation about this given your former prosecutorial role and the fact that there is a whole bunch of prosecutors who think that bitcoin gets involved in a lot of crime. we can discuss that another time. ari, appreciate it. >> thanks for having me. when we come back a can't miss interview with former republican house speaker kevin mccarthy coming off of friday's reelection of mike johnson to

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welcome back to "squawk box." 11 members of the house freedom

caucus board sending a letter to their gop colleagues saying newly reelected peaker mike johnson must prove he won't fail to deliver on president-elect trump's agenda. they write the following, they say they voted for johnson on friday, quote, despite our sincere reservations regarding the speaker's track record over the past 15 months. joining us right now to talk about the new republican dynamic in washington former house speaker kevin mccarthy, chairman. alpha institute. good morning to you. >> good morning. >> so there's a big piece in the "washington post" this morning. >> yes. >> i don't know if you saw, about tariffs and not just tariffs but really actually the bill -- i should really go maybe to the piece that was in axios, i'm mixing pieces in my head now, about sort of the idea there's going to be sort of one massive bill that's going to come due, if you will, with everything in it, immigration, potentially taxes, tariffs, all sorts of component parts. will the freedom caucus go along with sort of a massive maga bill? >> they're going to have to. i mean, this is what's so critical. for your viewers to understand

this is sort of reconciliation, you can only have if you have the senate and the house, it's how the democrats did obamacare, it's how we did tax reform, but the critical part here, in modern history it's the first time that the majority in the senate is bigger than the majority in the house. they actually lost seats in the house. another thing they are not talking about, the speaker talks about getting this done by april 1st. won't even have the two seats in florida that are open, the election is on april 1st. >> wow. >> the election for speaker he had a bigger majority and wants to do this. this is a big win for the chairman of ways and means jason smith because earlier they were talking about doing two reconciliations which i thought was wrong because what happens it gets more difficult to pass a bill later. exactly to your question. >> reconciliation means you don't have to have any democrats. >> i need 60 votes in the senate. you can't write any bill you want, you have the bird rule in the senate, thune has said he's not going to go against the parliamentarian. trump is right by moving to just

one because i think getting that bite that have apple is going to be a difficult job. >> what would you put in that? >> you have to do tax. >> okay. >> but think about this, you couldn't pass the same tax bill that you had now because the new yorkers and the californians -- >> want the higher -- >> for state, for the s.a.l.t. >> s.a.l.t. >> the president now said that he doesn't want no tax on tips. so this all costs more money. how do you offset this, right? then if you've got -- you need money for the border and think about this, if this is all supposed to be done by april 1st they never got the funding done from last year, that's due in march. so what are they going to focus on? they should have got all that done ahead of time. >> you say you are going to do this but also sounds like there is not a chance it's getting done -- >> it's getting done. the way we got tax reform done because we failed on health care, people leaned into tax, even though some didn't want to

vote for it, because they felt if we failed here we would lose everything. they know the pressure here. >> take it all or you have nothing. >> yes. they know the american public is watching this. now, trump is doing a very good job for this reason, he has the freedom caucus coming down, the freedom caucus letter there, the people who are anti-trump are more in the freedom caucus for any other place so for them to play this card they're wrong. they're trying to leverage for their own personal positions they are not leveraging for the trump stuff. i know what the private meetings are about. >> where are you going to put me in charge? >> i want the rules committee, i want chip roy in charge -- >> the rest of the republicans say no way we are not going to take that. >> they couldn't win the vote by their own conference so they tried to leverage this. >> this makes house from the house perspective does it make sense from the senate perspective? >> it's easier for thune because, remember, for the first time in modern history he's got a bigger majority. >> okay. >> and they go along more than here. but what trump is doing next

week he's bringing a number of members down. so trump is not only president he's pretty much the speaker now, too, because he's turning these votes. >> it's an lbj situation he's going to kick people in the shins and say you have to do this. >> he has to do this and he realizes the importance. i just met with the president friday. >> the incoming president. >> yeah, were president trump. >> president trump is better prepared to go into the job than eight years ago. he knows the job and what has to be done. he knows he has one term he doesn't want to waste one day. the people he brought in he is better prepared and the knowledge of what has to happen. so he also knows how to work. president trump knows these districts better than the members do. i spent a lot of time with him. >> i've been talking to a number of people that have been down in mar-a-lago and they say they think that he has -- there's more access to him and it's better, it's going to be easier

for him -- this last month easier for him to see people and to get to people than it is once he actually gets to the white house. do you think that's true? >> no. president trump is more accessible than anybody on his staff and this is the difficult part for someone who works for him. >> you don't get to be the gate keeper. >> he will talk to everybody. i don't understand how good he is at a work ethic. he doesn't need much sleep, he never has in his life. i usually would talk to him early in the morning and late at night every single day. still talk to him. the number of people he talks to in a day is amazing, more than any that his staff talks to. >> what do you think we should all make of the number of ceos who are going down to mar-a-lago and or now contributing to the inauguration? i ask because there are some people who look at this and say these companies never did this before, these tech companies weren't doing this in 2016 and weren't doing it for democrats either, interestingly. is this transactional, cozying

up, is this practical? are these the new defense companies, if you will, meaning -- i say defense companies and some banks and others were doing this years ago? >> i look at people who give to the inaugural different than someone who gives to the campaign because it really is a celebration of there. >> you know who the winner is at that point. >> there is a lot of people here. tech companies are different today, though. they never played in politics. >> they need to. >> but now they do. government can affect them and what have they done? a lot of them are putting government affairs together, realizing they better start building a relationship. >> meta and google have been spending enormous amounts of money in washington for the last decade and a half. >> they're further along than others. look, you say they're spending money it's now getting reported. a lot of these people spent money in campaigns that didn't get reported. >> right. >> so, you know, people know who they play with and what side. but the difference here is i take it as a positive that they've accepted this election, they don't want to fight this

president, he never got a honeymoon, president trump did, and normal presidents get nine months. i think this is better for the whole country and it's better because he won the popular vote. you have to give him credit. >> right. >> he is the first nonincumbent republican president to win the popular vote in 38 years. this is making the country stronger for them. >> so you just were with the incoming president trump. >> yeah. >> how does he feel about -- because, you know, we're paying a lot more attention to who is visiting mar-a-lago than to who is visiting the white house these days. how does he feel about this? >> more is happening in mar-a-lago than happening at the white house. >> right. >> and that's been happening for a long time. but, look, the world leaders are coming. look, i spent a lot of time with this president, he's meeting so many people and all the world leaders are coming. i think it's stabilizing the world, too, because if you look around the world after covid, most leaders of democracy have lost. >> okay. so go around the world with us. justin trudeau may be out. >> may be? i think he's out. >> okay. uk, i don't know what's going on

over there. >> he has not got off to a good start and is in real trouble. macron, how many times he changes. >> how does this all -- if we are sitting here together a year from now, what do you think this whole world looks like and what is the impact of either trump, trumpism, maga or maybe elon musk ultimately? >> well, i would say with trump i think the world becomes more stable. i think the middle east calms down. i think if you look to europe, i'd look to the prime minister of italy. now, normally the prime minister of italy only lasts a year and a half. she is a unique leader and i think she's becoming the leader of europe. you just watch, she was at mar-a-lago saturday, but she is a unique leader and she's genuine. i think macron is gone, i think europe and the others. germany, what have they done ever since merkel? trump does something different in stabilizing the world. you talked about that conversation on tariffs. >> right. >> prior to the election most of the questions you would have you were worried about is trump going to put in across the

board? now you're seeing he's being more selective. >> that's in the "washington post" today that it's going to be select industries. i guess that gives you more room for negotiation. >> trump uses it for two different ways, right? and when leaders of other countries call me to ask about what's going to happen, i tell them this, well, how do you street america? you want to know how trump -- he's going to look at your country and say how do you treat us. don't say this is what we've always done. that's not the correct answer. treat america with respect that you want to be treated by us, that's the way trump is going to look at it. you can be his friend but you can't treat america poorly and think we're going to take it anymore. it's all part of a negotiation but i think the world is going to be in a stronger place economically for this. >> what happens with ukraine? >> well, ukraine has fought for quite some time. i have a belief what putin has done is similar to hitler, you cannot invade another country. he's lost how many men and now north korea, it creates a great deal of fear to me looking a little more like 1938 when you have this axis of evil.

i think ukraine will come to a solution but my biggest concern is you have to break that axis of evil from china, north korea, iran and russia. that is -- that is a scary part for the rest of the world. that's what keeps me up at night. >> finally, elon musk. >> yes. >> co-president? what's going on here? >> no. that's a talking point. >> somebody who is inside the room, what's his role really going to be and what do you see going forward? i ask because he's spending an enormous amount of time obviously in mar-a-lago with the president now. >> yeah. >> he's spending an enormous amount of time on twitter or x, you know, and now he's working on what's going on in the uk it sounds like. but he also has these other businesses and i just wonder at some point is there enough time in the day? the accordion of his life to actually be able to do all of this? >> as you know i've known elon for a long time. >> long time. >> people have bet him and i tell people don't ever bet

against him. he's always had a lot of businesses and focuses on a few at a time while he gets the other running. the thing i have always known about elon, we have dealt in politics for a long time, he doesn't really drive on am i republican or democrat, he is an independent but he's really a constitutionalist. the thing that drives him the most is the first amendment. it is what drives him. what he has found since he bought twitter, he watched what government had done to people. it was a fundamental change in who he was. i was to the right of him and then after he bought twitter he came to see me showing me things that i didn't even know government had done and what he truly believes in this election he would say to me if we lose this election there is no other place to move. he moved out of california, i'm still there. he goes, i can't move to another state. so he really believes that he's working for the goodness of this country and for the constitution, and he's a driven person. when you push back against him, he will stand up for what he

believes in. i think it's going to be very positive. now, doge to me is great because our greatest threat to this nation is our debt and no one really is paying attention to it. >> are they going to have more teeth than, you know, the simpson bowles commission had? will congress listen? >> they need to. what i propose we need to deal with this the way we dealt with the base realignment and closure. congress and senate needs to put teeth in this. whatever doge comes up they're guaranteed a vote on the house and senate, guaranteed a vote and no amendments. let it vote up or vote it down. that's the only way you will get beyond the partisanship. if this goes to a committee it will die. >> watered down. >> if they get to make amendments to it everybody has some -- he is an outsider and what i would do, he is embracing anybody that wants to come into it. you talk about getting rid of the swamp, any american can give an idea and the power of the

idea can win. >> we're going to have to have you back. >> love to. >> we're out of team. we should talk about the hb 1 visa issue, we've seen blow back on that. we have some breaking news to bring everybody. thank you, sir. >> thank you. the fubu -- fubo deal with disney that was reported, well, it's now official. disney is going to own 70% of the combined entity and fubo's management team will operate the new combined live tv business, it's going to operate under the fubo publicly-traded company name, fubo says all litigation between fubo and disney has been settled which should be a green light potentially for venue, the sports service disney, fox and warner brothers. we will see. we will brichk you more news on that. "squawk x"omg ghba.bo cinrit ck how will you optimize your supply chain in response to global forces? balance sustainability and energy to power your industry and keep pace with data driven manufacturing? winners in the market are using data and digital technologies,

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all right. welcome back, everybody. our next guest is out with his annual top ten trends piece highlighting financial

predictions for 2025, i want to welcome ruchir sharma. i want to run through this because you have an interesting list. your first two items on the list are number one the return of the contrarians and number two momentum crashes. do you think that overall the markets are going to be faced with a lot of trouble this year? >> i think that if i can start off by saying this, becky, which is that in my 30 years of investing and i've been coming out with this analyst practically for most of those 30 years, i've never seen such strong group think prevail, which is that at the start of this year it's almost everyone seems to have the same view, which is that the american stock market will keep outperforming, the u.s. stock market will keep rising and the ai trend and mania will continue with the big tech companies benefitting. this is really a bit contradictory to the fact that we have elected to office

someone who is supposed to be the biggest disrupter and instead what we are predicting here, or at least the group think is predicting, is that the trends which we saw in the joe biden and really over the past 10 to 15 years will continue undeterred. so i think i take issue with that and i say here that i feel that the u.s. market in particular is possibly set to underperform in 2025. that's really, i think, my big call for 2025. the valuation gap has never been this wide, the sentiment differential between u.s. and the rest of the world has never been this wide, and i think the situation is unsustainable where the u.s. economy is less than 30% of the global economy but the u.s. stock market's weight now in the global index is approaching 70%. something can't go on forever, it won't. that is for me is the big central call of 2025 and what the trigger for that could be,

there are many triggers to point out, but a leading trigger could be that the attention could finally turn to america's yawning fiscal gap because there is no sign that that's going to -- >> we're almost out of time and i'm very sorry because this is a fascinating list. i think that's the one that really jumps out to me, too. this idea of punishing deficits, we have had them for a long time but you think the markets may sit up and take notice now? >> yeah, that's because across the world that train is coming. we've seen the markets take notice of that in places from brazil to uk, now france. the uk has been given a hard time with that but the u.s. has been given a free pass because it's the world's reserve currency and the attitude that, listen, people have been warning about the rising deficit for years if not decades so why worry about it now? but the u.s. has never run a deficit which is such an outlier. there is no country in the world today running a deficit number like the u.s. is running and

that has been artificially propping up growth. i think that is a sign now or an increasing sign in the bond market is beginning to take notice and i suspect as this year goes on and the treasury tries to sell more paper on the longer end of the curve that will begin to really -- arkets. that is something that could be a leading trigger. but the big call still is that i would be shocked if the group think is so right as it is now with its strong conviction of u.s. outperformance. >> thank you. "squawk box" will be right back. and they don't "circle back" they're already there. they wear business sneakers and pad their keyboards with something that makes their clickety- clacking... clickety-clackier. but no one loves logistics as much as they do. you need tamra, izzy and emma. they need a retirement plan. work with principal so we can help you with a retirement and benefits plan that's right for your team.

let our expertise round out yours.

good monday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer here. the consumer electronics show, a jobs number on friday. ten year, still pretty