conditions this week. it's monday, january 13th, 2025 and "squawk box" begins right now. ♪ good morning, everybody. welcome to "squawk box" here on cnbc. we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. the gang's all here. we're ready for the week. joe mentioned the u.s. equities are not looking hot. the dow futures down 175 points below fair value. s&p futures off 50. the nasdaq is off more than 250 points. what a way to start the week. good morning. stocks were down on friday after the hotter than expected jobs

numbers dampened expectations for more cuts this year. for the year, so far, the dow is down 1.4%. it's now down about 4.5% from its all-time high. i'm sorry. the dow is down more than that. the s&p is down 4.5%. the dow is down -- it was something that caught my attention this morning. off the all-time high. 7% for the dow off the all-time high. s&p is down 4.5% from the all-time high. the nasdaq is down .75% for the year. from the all-time high, same thing. close to 5%. a little over 5% if you are looking at the nasdaq 100. treasury yields have picked up significantly. the ten-year is now yielding 4.78. 30-year closed below 5% on friday. you can see it is sitting at 4.95 right now. the two-year which is up at

4.42. again, questions if the fed will cut at all after the numbers on friday. bitcoin is down about 9% from -- >> 92. supposedly support. tom lee will be on. there's oil. i'm glad. that was at the bottom. oil is pushing 0. that's always helpful. >> for the inflation picture. >> this started so slowly with single digit selloffs. >> you were saying from the beginning you were uncomfortable with how high. >> really quick big breaks. that's a bull market. when it starts slow, you write it off. eh. what does it add up to now? >> 7% for the dow. if you talk about a 5% pull back. >> it is not something that shakes your fear. that's the bad kind when it shakes your fear. it comes right back up. >> the russell 2000 is more than

11% now from an all-time high. you are talking about correction territory for some of the major averages. transportation had a rough day on friday. transports. >> i don't want to speak for tom lee. he'll be on. he talked about a good year, 2025, but near term jitters. it's playing out. we'll get more. >> this is the market that realizes it can't have its cake and eat it, too. strong economy. it was a strong economy. >> i think we have given up on rate cuts. maybe one or two. the liesman pollyanna. people are worried about inflation again. a strong jobs number. i said that would be the worst thing on friday. it was. steve said it's not a bad thing. then it happened. he said it is still not a bad thing. after it happened. he still said. >> did you read the "wall street

journal" on bonds? >> the weekend? >> yesterday online. >> that's right. it's online. >> it was such a weird convoluted story why bond yields may not be a bad thing and buying into it. it was kind of convoluted. >> it cannot be a bad thing if your fear is inflation. don't we get a couple? >> cpi and ppi. >> i think we get something. you know what? within a couple of weeks, we'll get something. >> that is true. >> you can count on that. we have other news to bring you this morning. jeff bezos' blue origin calling off the inaugural launch of the glenn rocket. it was trying to identify a subsystem beyond the launch window. it was slated to take off at 1:00 a.m. from cape canaveral. it had 1:00 a.m. to 4:00 a.m. to

takeoff. it had been delayed before because of weather and when they could get that launch window from nasa. morgan brennan will have more on the story later in the hour. when it does go up, if it goes up successfully, it will bring competition to the marketplace, which spacex and elon musk have dominated over the last several years. s ago, biden administration with a framework for a.i. the policy seeking to keep advanced a.i. models out of hands of malicious actors to ensure countries will have access to models. the rules require authorities for a broad set of countries, but include exceptions to allow the transfer of the advanced a.i. chips to certain allies and partners. if you can get it to a trusted ally or partner and whether they

can take those chips to certain others who are not trusted? >> if we see new glenn with two "ns." that's what it is. great ohioan and senator and democrat who i love. >> what's not to love? now to the wildfires in los angeles. death toll rose to 24 people over the weekend. forecasters are again warning of dangerous weather with the return of strong winds this week. the national weather service said to expect severe fire conditions through wednesday. sustained winds of 50 miles an hour and gusts in the mountains reaching 70 miles an hour. law enforcement is warning people to stay away from the scorched neighborhoods. they are looking to an online data base. we will get a live report from

the frontlines of the fire in the next hour. later, michael rubin will join us on efforts to support people affected by the fires. meta's ceo mark zuckerberg slamming rival tech giant apple on friday. he's what he here's what he sai joe rogan experience. >> they used that platform to put in place a lot of rules that an, i think, feel arbitrary and feel they haven't invented anything great in a while. steve jobs invented the iphone and now they're sitting on it 20 years later. >> zuckerberg said apple makes money by squeezing people and having a 30% tax on developers before we play some of these things. we should talk a little bit more about what this means. this is almost a declaration of war. you rarely see a big company making comments to try to draw

in regulatory oversight. that's what this seems like. i don't know if you heard it. >> he has been doing this for the last five years, maybe longer. >> this is pretty explicit. >> he has been saying it relatively explicitly. the 30% piece is frustrating for him and on a number of vels because they are trying to build business on top of the meta businesses. >> the meta glasses. >> the glasses are separate. the 30% piece is about charging people. he tried to build businesses on top of meta. you have to be paying the 30% to apple before you would be able to build the additional. >> we cut off the quote he was saying. the big part of it is they are great for building the ecosystem. we don't want to pay. >> they don't want to pay to use the ecosystem. the second part is the meta glasses which is my earbuds,

where are my earbuds. they connect to the iphone better than any device. >> he said that. >> he has been frustrating. i have the meta glasses. i like them. it is a little bit more complicated to connect the glasses. it is complicated to connect anything to an iphone relative to the -- relative to an apple device because they are using a different protocol. one of the points he makes about that, which is interesting, they are arguing a security thing. they are saying build the security into the service. i'm sure there's elements to that which he is right about and there are elements on the other side. >> he said this is just an excuse that apple is using privacy and protections. he thinks it's a big scam. that'she saion joe rogan. they are using that as an excuse. usually you don't see big tech companies very publicly saying to the regulators here is where

you should go after them. it is a system of whispers behind the scenes or getting others to go do it. he said it explicitly. you know, they're frenemies. >> i think this is less of a frenemy. this is more of an enemy thing for a long time now. of the relationships, this is probably been the most complicated. i think people are following this know this is the most complicated. >> who is closer to the trump administration? mark zuckerberg or tim cook? >> i would think tim cook is. i think google might be. >> google's close. >> i think sundar has had -- >> a maga seven.

who is not in the maga seven? >> netflix. >> zuckerberg described the company's relationship with the biden administration. he said officials berated facebook staff during requests to remove certain content. >> basically these people from the biden administration would call up our team and scream at them and curse. these documents -- it's all out there. >> did you record any of those phone calls? >> i don't think -- there are emails. >> he said the white house asked facebook to remove a meme. >> that? >> he said the white house asked them to remove a meme of the actor leo dicaprio pointing to a tv screen of the class action lawsuit of the people who cook the covid vaccine. zuckerberg made the comments days after he announced meta

would end the fact checking program and replace it with community driven structure similar to the one on x. in the meantime, meta platforms rolling back the dei programs. meta is changing its course because of the change in legal policy landscape with dei efforts in the united states. as a result, meta is replacing teams with programs that mitigate ias for all no matter the background. they say set the impression is being made based on gender or race. amazon halting its dei program as well. it will continue to operate and form to advocate for specific groups. you know, robin starbuck.

the power and influence. >> he's just a messenger. >> he is the messenger. >> it is collapsing over the weight. >> they are about to hear from him. >> if the problem wasn't there, it wouldn't matter. robby starbuck can't just come along and change corporate america. it is dying under its own weight. it's fundamentally probably not a great way to do things if it is not based on merit. we should have learned that by now. we all want to get to a certain place. if you do it wrong, it's going to collapse. coming up, a busy week in the markets with key inflation data. the kickoff of earnings season. we've been talking about tom lee joining us and he is up right after the break from fundstrat. he'll join us next.

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welcome back to "squawk box." time for the squawk planner. buckle up, folks. we have a busy one ahead. inflation data in focus. joe is right. we will get producer price numbers for december. the consumer price index on wednesday.

thursday, jobless claims and retail sales and housing starts data on friday. earnings season also kicking off. that's on wednesday. here's what's going to happen. we get the latest reports from jpmorgan and wells fargo and citi and blackrock. on thursday, bank of america and morgan stanley on tap and united health which is a company in the news for a lot of reasons. >> yeah. maybe it's compressed because of the calendar. it literally is like we did the cpi and ppi last week. >> it was two weeks ago. the holiday schedule. >> tom is an inflation fanatic. he's here. let me intro you. let me give you what you deserve. in a good way. the dow tumbled 00 points on friday. the fed hits the pause on the rate cut. joining us is tom lee from

fundstrat and cnbc contributor. i do remember you sort of being positive overall about the market this year, but with some trepidation near term. most of your calls, recently, have been less on the strength of the economy and more on inflation data. some of your -- when you were calling things, s&p is going to end the week 8% higher because of inflation or something. we got inflation this week. there are concerns. i tie a lot of the weakness in the market to that. are these important numbers? >> it's important because, as you know, we've been correcting now for almost a month. 23 trading days and this wednesday is an important day because it's a possible turning point for markets and i would like to see cpi come in below .25 or so. i think that would give that jolt of confidence to markets on top of earnings, which is going

to be a positive catalyst, but for investors in the near term, they have to ride out the volatility because yields here have made people nervous. not necessarily deteriorate to the long term outlook, but near term. >> are they smart the yields or not giving us the correct signal? you sound really like you're not sure about the inflation data this week. >> uh, i'll have a better sense over the next couple days as we sort of finalize our expectations are, but the only hesitation we have is that the hurricanes last year have muddled some of the inflation quality because for instance, hotel reservations would go up because of the natural disasters and it will happen now with the l.a. fires. i think it will muddle used car prices as well. you have to replace the cars. >> if it weren't muddled, you think inflation isn't that big of a concern. when you say a turning point in the markets, if we have been

down for a month, turning point doesn't mean further weakness, you think we might be making a bottom this week? >> yes, our technician mark thinks 5,700 could be the turning point. it could happen wednesday maybe 2% down from here. that's where the market could make a stand. i think if we lift the cloud of the muddling and waller said most of the inflation was about muted prices. the real price of inflation was much lower. i still think that is the case. inflation is weaker when you look at housing, et cetera, once we get through that noise. investors, i think, shouldn't be some glum. i think earnings season is something that really solidifies if earnings growth is 10% ex energy and earning growth 5%, that's a good reason to be owning equities. >> is the fed less significant right now with their rate cut? i don't care. that's not what i base the

market's going to do. are people still dying for another couple of cuts or i think we've been lucky to have got ten what we've lready gotten and hope inflation doesn't come back. >> i agree with you. i think the best case is the fed doing one cut because the economy's strong enough and they are still dovish. they will make their way to neutral. if they push the cuts to 2026 and 2027, that's a longer rate to support markets. part of the hesitation is we have the new administration starting. >> what? oh, that's right. >> yes. you know, essentially, we reversed that rally over 23 trading days and now we've given up 5% and another 2% would on round trip us. >> 23 trading days. >> yes. >> do you think stocks look expensive here or not? we've come back down as you

mentioned. people keep talking about the pe ratio and how it is historically at the high end of things. do you think we have the earnings power to support all of that? >> to me, the ten-year even if it gets to 5%, is a 20 pe multiple on a ten-year bond. the median pe is 17 times. i think stocks aring giving you much better value than a bond right now and 5% is probably not the level that yields stay. it is probably a deflection point. >> tom, what is the movement in bitcoin? is that a signal or a sign in any of this analysis? >> stupid fed. not cutting. >> bitcoin is down roughly 15% from its highs which for a hyper volatile asset is a normal correction and following global liquidity. we are early in the halving

cycle. our technician thinks 70,000 is where we make a stand. i think bitcoin is one of the best performing. >> you think it goes down to 70,000 or do you think that's the floor in which case you would buy at this price? >> one level would be 70. >> say that again? >> retracement level. you pull back from where you rally. 70 is one level. it could go as low as the 50s. but that's again not a new level. that's where it touches before it begins to rally. >> let me ask you a different question. for those watching not in bitcoin on thinking of buying bitcoin at these prices, are you saying this is a fair price to get in or are you saying wait because you feel it is getting farther down? >> bitcoin is something you need to belong- long-term focused. if they are trying to time this, maybe they get lucky and it goes

to 70. to me, bitcoin could be significantly higher this year. maybe 200 or 250. i think 90 is still a good entry point. >> the whole story is iat story. anything that goes against. the fed is half what it is worth in ten years. we're not going to do anything about that 37 trillion. we're just going to add to it, don't you think? >> that's a staggering number. >> and we're not going to do anything for it, i don't think. we'll be at 40 trillion before we know it. >> i think 37 trillion is okay if gdp gets to 50 trillion. we're at 30 trillion now. >> what did you say about pe? did you say 17? >> median pe. yeah. take the 250th most expensive stock is 17 times earnings.

>> what is the normal multiple for the s&p? not median? >> if we took weighted including the contribution from ag seven, it is close to 19. >> it's not 22? >> it's not 22. >> this is on forward. >> on forward earnings. >> you are expecting 15% or what for gains? 20? >> for this year? >> yeah. >> yes. 10% probably for the full year, but probably 15 or 20 by mid-year, yeah. >> okay. >> and then it gives back? >> it's hard to tell hat the second half looks like. there is a lot of signs of risk aversion which is always good. last week as a huge increase in money market cash balances. markets are starting to capitulate. that's why this week is important to watch. >> all right. great. i feel like i know a lot more. >> that's optimistic. >> definitely. he's been that way.

i give you credit for saying there's going to be some bumpiness at the beginning of the year. it's exactly what we're seeing. it's not feeling too great. >> it feels terrible, but we have to ride through these. >> i don't know if anyone will buy broadband ever again. i know that's an obtuse comment. it's at $36. thank you, tom. when we come back, the biden administration is holding off on its order blocking nippon steel's deal to buy u.s. steel. we'll have the details on that story right after this break. later this morning, avenue capital's marc lasry will join us to talk about the big money in the world of sports and his read on the rks maetright now. "squawk box" will be right back.

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the biden administration will hold off on enforcement of its order that requires nippon steel to abandon its bid to buy judgment steel. president biden blocked the deal on january 3rd on national security grounds. it will give the courts time to review the legal challenge. they previously had 30 days to unwind the transaction, but will now have until june 18th. the companies have argued the review of the merger was prejudice by the longstanding opposition to the deal. as a result, you can see shares of u.s. steel up 4.6%. $35.84 was the last tick. okay. when we come back, blue origin calling off the inaugural launch

of the new glenn rocket overnight. after the break, we will take you live to the launch se.it "squawk box" returning in just a moment. >> announcer: executive edge is sponsored by at&t business. next level moments need the next level network. at&t has a new guarantee. because most things in business are not guaranteed. like a distraction-free work environment. get those steps in, kevin your coworkers keeping things confidential. oh, she's spilling all the tea. or office etiquette. yeah, that's not guaranteed. i know you can see me. you know what at&t guarantees? connectivity you depend on, the deals you want, and the service you deserve. can i get that logo bigger? or we'll make it right. that's the at&t guarantee.

good morning. welcome back to "squawk box" live from the nasdaq market site in times square. when are we going back downstairs? >> february. >> is it a month? >> yeah. >> i like it up here. you miss the geeks and freaks. people write in and they miss it. some people don't like it. >> i heard from people who have stopped by looking for us. >> looking for us. >> we weren't there. >> we weren't calling them geeks or freaks. >> we're geeks. let's look at futures. a rough session and rough month. rough six weeks. the biggest pre-market decliners in the s&p 500 right now.

you can see nvidia down about 3% again. some of the big high flyers have definitely come in. palantir as well. we want to get to morgan brennan in florida because jeff bezos' startup blue origin calling off the inaugural launch of the new glenn rocket after the technical glitch at 1:00 a.m. the rocket is aiming to take on elon musk and spacex in the commercial space sector is a huge moment for the space, if you will. morgan brennan is joining us live with more. i imagine you were up at 1:00 waiting for new glenn to take off. >> reporter: sleep is for suckers, andrew. i was up at 1:00 and they kept pushing back the launch attempt. they finally scrubbed it at 3:00 a.m. last night, i spoke with dave limp from inside the new glenn

rocket factory and as bezos' company looks to enter the launch market and i asked limp what the incoming trump administration ill mean for space policy. >> i'm optimistic. if you go back to the first trump administration, they did a lot of good for space. they created the space force. they were very, very proactive with the space council. they gave the first lunar commercial contract for space through nasa. so, these are things are still continuing today that are boons to the u.s. i think they'll continue that momentum. >> what's different this time around is one of your rivals, blue origin's rivals, elon musk and spacex has the ear of the incoming president and a role through doge. how do you navigate that sna ? what does it mean? >> he is doing it for the public good whether it is doge or his

other work. he is not trying to put his thumb on the scale of his private companies. i think it's great. we'll see how it goes. i'm optimistic. >> reporter: musk wishes bezos and blue origin luck on x this morning. jared isaacman is trump's nominee. i'll interview him later today. for blue origin, this rocket is unlocking the road to space that the company is building and it's foundational to bezos' broader vision which, andrew, i know he reiterated with you a deal book last month to basically see a world where millions of people are working and living in space and all of the heavy industry on earth goes to space. the full interview with dave limp is on cnbc.com and my

podcast "manifest space." >> this window was missed and they have to do other work. what is the new timing for new glynn glenn to make it to space? >> reporter: we don't know. it is sitting on the launch pad. we don't know the next attempt. there were anomalies that needed to be trouble shot to take place. i expect we will get that timing sooner ther than later. this is a major moment for blue origin and the space industry. once it does start launching and become operational. it's already got a few customers. billions of dollars in backlog including amazon and pentagon and nasa and others. as limp told me last night and i heard for a number of years, there is just more demand than there is capacity in the market

right now. so many different companies and governments want to put so much stuff in space. there's not enough launch capacity to do it. at least not yet. this would be a major moment. >> morgan, is your sense we could see it in days? do they need to apply for a new window? is this something they could repair in 24 or 48 hours and they would be up on thursday? >> reporter: that's a good question. i don't have those answers yesterday. i'm out to the company. i suspect -- based on the low level -- little information we have, it is a potential for new milestones. they are trouble shooting those issues. you have another test flight later this week. you have another launch on wednesday of two different

commercial lunar lan dlanders. we have a lot of space activity this week and it is kicking off as it is expected to be a busy year in terms of this economy materializing in a more meaningful way. >> morgan, you have been at the forefront of it for a long time now. thank you for staying up all night and i'm sure we'll see you the next couple days. thanks. when we come back, we've got the latest political headlines out of mar-a-lago as president-elect trump preparing to take office. we have the best of "squawk pod." just follow and listen anytime. we'll be right back. ( ♪♪ ) partnering to unlock new ideas, to create new legacies, to transform a company, industry, economy, generation.

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we have news out this morning from bill ackman and pershing square. it's a complicated transaction. i'll give you top line information. he is acquiring the howard hughes holding company. this is an under performer in truth, but buying at a premium. well talk about the premium in a second. perhaps the larger story is this acquisition that effectively bill ackman is going to attempt to make now, would become a permanent capital vehicle for pershing square and puts pershing square in the business of buying controlling stakes in operating businesses so much so that the way bill ackman is now describing this transaction is

to compare this deal with the first deal that warren buffett ever made. >> this is his way. >> with ies to mr. buffett, hhh would be the modern bay berkshire hathaway with controlling interest in operating company. pershing square up here and all of the different funds. you remember that pershing square sought to go public in the ipo earlier this year. that was temporarily withdrawn, but my understanding is that they could decide to go public again in the future. so, this is sort of an initial step in this permanent capital effort for pershing square. >> this is another vehicle? >> this would remain a public vehicle and that's why it's complicated. we should talk about how this deal is going to go. there could be the additional

deal with pershing square till goes public. we have the permanent feature. it's complicated. that's why i said bear with us as we walk through this. pershing square, we should say bill ackman and their team own 44% of pershing square. in terms of this deal, howard hughes has been an under performer and not delivered dividends. part of his bet on this company is he believes in the next couple years it's going to start producing lots of cash and that would obviously be a requirement, if you will, to be a successful venture to produce enough cash to become not an insurance company, of course, but create a lot of ebitda and start buying lots of other businesses. in terms of this transaction itself, though, what you are looking at if you are a shareholder of howard hughes today, you have the option

effectively of cashing out completely or you have the option of rolling in which is what they're going to be doing. you will be able to effectively roll into this transaction which then be controlled by bill ackman. >> they purchased a majority share? >> they purchase the majority share of the company. you could effectively think of it in a unique way of take private or take private public. here's how it works. the consideration in cash is $85 per share. you are looking at $81.25 which is a 38% premium before the news and 18% to the closing price on friday. they are saying that there has been speculation of what would happen to this business, but you are also allowed if you want to roll in the way they are to take a combination of cash and stock.

there are going to be some shareholders who want to go on the ride with bill ackman. >> you can't pledge your whole shares because they need to buy a majority of the shares that take over? >> it gets complicated because there are two ways to do this. that's why i said we'll have to spend time going through this. you need enough shareholders to roll in to make this all work. if it's all cash, that creates a new kind of challenge because i don't believe they have enough cash. the math is $1.5 billion total cash proceeds from pershing square and bond to finance this. divide $85 per share. that's going to be the money available on the cash basis if the shareholders vote for it. of course, this will require a vote as well. we're going to have to get into some of this. i apologize. it is super complicated.

>> a $3.6 billion market cap. pershing square has owned a portion of this for a while? >> a huge portion. they will roll their shares in and they are hoping others will roll in with them and pay out cash to the others. that's why you are seeing the shares trade right now. i think that's a decent explanation. >> you know where this company came from? why ackman knows about it? general growth. >> this is the real estate piece. >> he made so much money. it's almost -- that was one of the great home runs for ackman. >> this business has not made a lot of money. the stock has been an under performer for a very long time now. he's been out there and he loves the management team. he has been talking about the management team for a very long time. it has not been a great winner. there, we're showing you howard hughes over the last year. look at it over the decade and

this is a business that has not provided a dividend. >> master of communities business. >> think about it. >> making spruce gooses or something. aerospace some way. or fingernails. >> stop. >> urine bottle. coming up, more on the comments by mark zuckerberg blasting tech rival apple. that's moments away and fanatics ceo michael rubin is going to lirne bout supporting th cafoia wildfires relief. that's at 7:45 a.m. eastern. we'll be right back. do you charge forward? freeze in your tracks? (♪♪) or, let curiosity light the way. at t. rowe price, we're asking smart questions about opportunities like clean water.

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coming up, meta's ceo mark zuckerberg going off on apple on joe rogan's podcast. we'll talk about what he is sangyi about the iphone maker. that is straight ahead. "squawk box" will be right back. i' een it.

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there are a lot of other companies in the world that would be able to build a very good earbud, but it just -- apple has a specific protocol that they built into the iphone that allows airpods to basically connect to it and it's just more seamless because they enabled that, but they don't let anyone else use the protocol. if they did, there could be better airpods out there. when you touch on this, they get super touchy and wrap their defense of it in well, if we let other companies plug into our thing, that would violate people's privacy and security.

no, just do a better job with the protocol. >> that was mark zuckerberg on friday taking a shot at rival apple. joining us is gene muenster. gene, you own apple. do you think there are longer term issues as a result? >> i don't, becky. this is bad blood between the companies. zuckerberg has been on this tirade gainst apple for a long time. of course, he doesn't like what they're doing with the app store which basically blocks them out. it makes it difficult for meta to get any sort of edge in terms of having the direct connection with their customer. i think that has been the essence of what has pushed this as far as it has. i think this is bad blood and i think that, you know, they've tried to make some peace, but it hasn't come to fruition.

at the end of the day, the concept, they haven't innovated. they have. services watch airpods is 30% of their business. they have stalled in terms of vision pro car. that hasn't taken off. at the most basic the most basi i think this is just two companies that don't see eye to eye. the fundamental reason is because meta feels that apple has control of its destiny and zuckerberg does not like that this. >> is it anticompetitive behavior that rises to an oversight level? >> i don't think so. the app store, how they operate that. you know, can you have independent app stores and the steering. all that is related to how zuckerberg's commentary has played out. at the end of the day is that apple has been leaning back, zuckerberg said it in that

prepared comment there is that apple leans back on the fact they ultimately need to have this oversight because of security and just a cleaner app store. i think that that has stood up on the regulatory front. so i would be really surprised to see any sort of substance changes to the policies. i don't think there's going to be anything that's going to be elevated against the app store in the next several years. >> gene, last eek was a rough week for the tech stocks. you were looking at the nasdaq pulling back more than 2.25%. now down more than 5% from the all time highs. there are a lot of people wondering what 2025 is going to bring. you think there are two huge things that are happening this week for tech. the first one kind of caught my attention. the cpi numbers tomorrow are incredibly important you think. you want to explain that? why cpi can have such a big impact? >> it's the relationship between interest rates and

risk. of course if rates stay up higher for longer or become elevated, it makes it less attractive for investors to go into riskier assets like owning stocks. i think that relationship we saw of course play out in a really big way when rates were going up a couple of years ago. this still plays and nags at investors what's going on with interest rates. i think the reason why the cpi number has maybe an outsized impact this week versus maybe six months ago is that the market is higher. i think that investors, tech investors are looking for that reason to sell. this could be a hot cpi number could be a near term catalyst. this is going to be a messy week. there's a count balance to this week too. tsm who has given their december revenue numbers but they're going to be reporting on thursday giving outlook for this year. of course they're critical in terms of building a lot of advance notes for ai chips.

so i think ai trade might get a little bit of some reassurance with that tsm commentary. overall this is going to be a messy week. of course all eyes are going to turn to what big tech is going to say next week. >> the big issue you think is ai is going to be something that continues in reality not a hype machine. at least for the rest of this year and probably the year after that as well. >> undoubtedly. i want to put some quick parameters around that. for most people ai is just a buzz word. the daily active users of chatgpt is about 150 million. 2.5million when it comes to google. this is relatively small. i think it is an undeniable truth that the substance will exceed the hype. there is a question about how to invest in that. will the mag seven continue to lead the way? what we've seen over the past couple weeks here is some of

these smaller companies, if you measure it by the loop loup frontier tech companies, that's up 2.5% this year. so these are some of the smaller type of ai companies. becky, i feel very confident that this ai we still have a couple great years left. it will end in a spectacular bubble. i do think we'll see better performance on the margin with smaller companies in 25. >> gene, thank as lot. gene munster. >> thank you. >> just after 7:00 a.m. right now on the east coast. you're watching squawk box on cnbc. i'm andrew ross sorkin along with joe kernen and becky quick. oil hitting a new high on a wave of u.s. sanctions against russia. that coming after the market closed on friday. the new sanctions -- we'll see if there's an impact. you can see what's going on in the oil markets with energy giants including more than 180 tankers and another dozen

russian energy officials. meantime in the headlines, johnson and johnson reportedly in talks to buy intra-cellular therapies. deal could come as soon as this week. focusing on treatments for central nervous system disorders. you're looking at intra- cellular up about 35% on the back of that news. and i don't know if you saw this. jp morgan chase's ceo jamie dimon is cautiously pessimistic about the future of the u.s. economy. speaking with cbs news. consumer concerns and the desire for more pro growth, pro business policies are among the reasons donald trump is retaking the white house but interestingly he's oftentimes been, you know, cautiously optimistic about the economy. i thought the phrase cautiously pessimistic was interesting. also a fascinating interview. really spoke i thought on a personal level. i don't know if you watched the

entirety of it. >> no. >> about some of his health issues that i don't think people fully appreciated. he had a heart issue then. he'd had a heart issue prior to that as well. just very emotional to hear. >> talked about his surgery. waking up and waving at his kids and just kind of thinking -- she asked him specifically have you lived the life you wanted and he said yeah, just not enough of it. >> yeah. hear that's a pretty common -- no one wants to go ever. i know i don't. i remember talking to him a couple times. this is a long time ago since it had happened. initially it was like, i knew this was going to happen to me. and then once you get beyond that just i guess deal, knock on wood. say it again and again. ask not for whom the bell tolls. developing story in the california wildfires. one thing, jamie used to think that the economy is much

stronger than people thought. that the fed was crazy. now sounds like a little bit after change. that he's more worried about -- because i don't now if i call it cautious. >> wildfires are still burning and strong wind forecasts for this week. neighborhoods -- i watched them. they're decimated. lives. livelihoods. homes. schools. businesses lost. of course the worker recovery begins. gavin newsom's emergency declaration clears the way for rebuilding. he's ordered state agencies to streamline the permitting process. the economic impact estimates of $135 billion to $150 billion. insured losses of more than $22 billion. that's a new estimate over the

weekend. these are early though. and largely this is a residential story as opposed to a commercial property insurance story. although it's not insignificant for commercial either. in pacific palisades insurance coverage from the fair plan, california's last resort insurer plays a predominant role. claim payouts are capped at $3 million. so of course that leave miss homeowners underinsured. highly placed insurance executive tells me that's likely a theme even where homeowners had coverage through brand name insurers because materials inflation, construction materials up 37.3% over the last five years. construction labor up 35%. far higher than regular inflation. homeowners may not have kept pace with their coverage meaning they may have coverage for say a $2 million replacement value where now it maybe would cost closer to $3 million. i'm told where homeowners have

paid off their mortgages or never had one they may have opted out of the insurance coverage altogether given how high the price of insurance is. and when it comes time to rebuild, already brokers are warning me developers of multiunit properties may opt to take the insurance payout, you know, just sell the land and run because of the prohibitive cost of insurance. it just makes developing land unprofitable. president biden has of course promised 100% federal assistance to cover all of california's fire management and debris removal cost for 180 days. that's up from the typical 75%. if you can take me full now. i just wanted to show you a little bit. this is a multiproperty unit here. 16 units with amazing views of the pacific ocean. completely gone at this point. and this creates all of it, short term housing crunch. maybe a crisis. a top executive told me the insurance company he works for

is already securing rentals of houses for their clients. and two, part of the big cost of this is that this is now a toxic waste site because of the flame retardant and the fire itself. so that adds to the cost of demolition at this point. something that we'll have to keep our eye on. >> it's very concerning because the winds are kicking up again. i'm just wondering whether this could be replicated. you know who ran against karen bass, rick caruso who had previously been the commissioner for the l.a. department of water and power. he's a billionaire developer and he employed private firefighters and water storage tanks and saved one of his properties. a pacific palisades mall. he was able o save that. i wonder if that can be replicated. this is ahead of us now.

monday, tuesday, wednesday the winds could kick up again. the gusts to 50 to 70 miles per hour. he's been very critical of karen bass and government officials for, you know, fire preparedness. insufficient water storage. everything. in terms of forests, what should be done with forest management. >> management, right. >> now that they're ready. could they be ready to do something like this to save as much as possible for what could be another onslaught. >> it's already happening, joe. while the fires were burning even last week there were neighborhoods that were banding together to say hey, should we hire our own folks to go out and spray fire retardant and then other neighbors said yeah. do we want to have this toxic chemical in our lawns and on our homes if it's not going to burn. so that's already happening. the second thing is sells

insurance in the excess and surplus line. this is outside of the regulated insurance market. they can charge what they think the risk costs and do and it's not subject to approval by the state insurance commissioner. chub contracts with these private companies that go out and they'll tape up your vents and spray down your foam on your roof. that's part of this high end service that you get when you contract with chub. a lot of people would have gotten this through their insurance company and, you know, it helps protect your house. the other thing that's going to be in focus in rebuilding is, you know, i had just sent a story on new year's eve about the mitigation available with building materials and the way that when you build a house to withstand fire it can withstand a lot more. a blowing ember doesn't necessarily ignite that house then. there will be a lot of focus even if they streamline it, can

you build back better and more resistant. >> right like pepperdine. the mote and. just water storage tanks. i'm not even talking about the flame retardant stuff. just water. they didn't have water. with the palisades reservoir. >> they had a pump and a sprinkler system in your pool and they could have done it. i've seen people with videos to save homes. >> the idea was the palisades reservoir was empty. contessa, thank you. in the next half hour, fanatic o miaecechl rubin joins us to discuss his company's efforts to provide aid and donations to victims and agencies of the l.a. fires. squawk box will be right back.

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this morning. dow off about 144 points right about now. nasdaq off 267 points. s&p off about 52 points. we should probably show you the treasury yields right now. because that is having an impact on all. the ten year has continued to climb. want to bring in chief market strategist for the americas jp morgan asset management. what is going on? >> i think it's a continuation of some of the repricing that we've been seeing for about five weeks now. i do think you're right, it's very much being driven by a shift higher in yield along the curve, but i think most importantly in ten year yield and in specifically real yields. so i don't buy this is all about higher inflation expectations or reset fed expectations. it's very much driven by uncertainty in a different part of dc. so really i think we're all bracing for a week from now after the inauguration the flurry of information we're going to get and how we can

shape our expectations of economic forecasts and risk premium from here on out. that reprices assets across the board. >> so what's the full reprice look like? when's that happening? >> so i do think it's already happening. if you look at just the s&p 500, maybe you'll miss it. it's off 4% off time highs. the median stock is now down about 15% from its 2024 high. so i do think there's already a bit of repricing and understanding that it's not all good, it's not all bad coming out of dc. it's going to take us a little while to figure out how it nets out for different companies. and the scale, the scope, the sequencing of policy. what of course hasn't fully repriced is more of airgap tech. more high valuation, high expectation sectors. and that could drive a bigger repricing in the index. overall given it's 40% now. >> i know that what you do and

jamie dimon does don't always correlate exactly. we were commentingen this interview where he called himself cautiously pessimistic as opposed to cautiously optimistic. do you have the same view? >> i would say we're cautiously optimistic about the economic outlook. last year was realizing corporate household balance sheets are doing fine. we're normalizing across a variety of indicators. labor market. inflation. we're also cautiously optimistic about the long run outlook. also a big story last year was the improvement on the supply side. where we're more cautiously, i wouldn't say pessimistic. the reason for caution is in portfolios. there is a cost to pay a very strong but very concentrated returns. when we speak to investors, what was a 60/40 allocation is now a 75/25 allocation. that was 50/50 growth value is

now 60/40. there's a lot of focus on recent winners. that doesn't set you up for strong returns going forward. >> maybe a curve ball. maybe not. it's obviously in the headlines. does what's happening in los angeles do you think have any meaningful impact on gdp over the next several quarters? if not longer? by the way, you could argue it could have a big impact in a good way in so far as there's going to be spending. >> you see that with natural disasters. there's a temporary at times negative effect which is made up later as there's rebuilding that takes place and then it just nets out over time. but i do think it brings up a really important point around when you speak to clients about inflation, you know, we speak about it in economic and market terms year over year. yes, it's normalizing. but there's a cost there around auto insurance, home insurance, which is not just about california; right? it's about a lot of states in

the country. i think that explains a lot more of the malaise, the frustration about the current costs and about the current economy. that's not just reflected in of course how we think about it as economists or investors. >> what do you think just so i understand, what do you think has happened in the last five weeks? why do you think the mind shift has changed? everybody was in this, i don't know if it was a trump trade. i don't know what you think it was. november, december, it was like we are off to the races. then everybody went for the holidays and decided -- or maybe even before the holidays decided maybe not. >> yeah, really before the holidays. so we started pricing in the republican sweep mid september so there was quite a long period there. and then you started getting to december, you know, you start getting into the weeds of the details. so what exactly is going to be the sequencing of policy. how is that going to net out. is it going to be a net positive, net negative for

different assets. for equity specifically there was more of a focus on the positive aspects. on friday we'll get the forecasts around the deficit and debt projections. that's what's driving this 80 basis point rise in real yield since early december. just based on current policy the deficit is set to rise to 7.5%. then we have to factor in the discussions that are beginning to start taking place next week and for the rest of the year. >> thank you. up next, charting a path for what's been a sticking point for congress. we're talking about the salt tax. incoming president trump is on board with increasing that key deduction telling members over the weekend to work on a fair number. we've got the details next. and then fanatics is working with dozens of sports properties and l.a. communities to raise money for the ravaged l.a. fire area. the ceo michael rubin will join

us. squawk box will be right back.

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welcome back to squawk box. officials said policy seeks to keep advanced ai models out of the hands of malicious actors and ensure that responsible countries will have access. among the provisions, authorizations for exports to a broad set of countries but includes exceptions that would allow the transfer to certain allies and partners. becky. republicans in high tax states see a path for the salt caps in the upcoming tax bill that's supported by president- elect trump. emily will kins joins us now with more. this was a big meeting that was held at mar-a-lago over the weekend. >> yeah, becky. you had 16 lawmakers go down to talk about salt. trump promised that group of lawmakers from those high tax states that that cap on state and local deductions will raised.

lawmakers do not expect to completely remove the cap which is what we had before 2017. and that cap is currently at $10,000. you can see some of the lawmakers there meeting with trump. one of the lawmakers there in the co-chair of the salt caucus said that while the group is willing to negotiate, that there really has to be a significant increase to get their support. he said just doubling the salt cap is not going to be enough. >> i want to win reelection. if i vote to keep that cap at $10,000 or even raise it to 20, or to put it back at 20, i won't be reelected. it's literally the one thing that people talk to me about most. i'm out to dinner, out watching football on a sunday. people bring up hey, when am i getting my deduction back. this is what people care about. >> lawmakers opposed to raising the cap have pointed to the cost. according to an analysis, just

doubling the cap to $20,000 only for those making less than half a million would cost about $22 billion over ten years which means raising the cap beyond that would cost more. in addition to taxes, lawmakers and trump also discussed ways to get rid of new york's congestion pricing. something trump said he wants to kill if he has the power to do so and he asked lawmakers to see if they could get him and his team some data as he looks into that. >> let's talk through those points. the idea if it's doubled you still have lawmakers who wouldn't support it. i mean we've talked about doubling it as being a really difficult hill to overcome to get past. what are the odds? do you think that's just negotiations taking place? and tough talk coming out of that? or do you think they're looking for a higher number? >> if there's a time to negotiate, this is it. i mean really for the salt lawmakers they've got the wind at their backs.

they know worst case scenario if the tax packages do expire and they don't have a deal, that means unlimited salt and that's going to be a good thing for their constituents. now i've been reassured that they don't want that. they understand that a number of other things would expire that would raise taxes on their constituents and across the country. but they really see this as a golden opportunity for them to push forward. especially knowing they're going to have trump's support on their side. the big question right now that we're all looking for from capitol hill is what is the number for this big package that they want to pass? how much are they going to spend? how much is going to be offset? where are the offsets coming from? that was all the other meetings you saw at march alego with the freedom caucus, with leadership groups. them trying to figure out where do things need to be. what's going to be able to pass and what are some of those red lines that could prevent this bill from going forward. salt is certainly one thing to keep an eye on. >> emily, we're out of time,

but very quickly on congestion pricing. how would incoming president trump deal with that? is this transportation funds? locking that up and saying you're not getting them if you have this? >> so president biden administration proved an environmental review that allowed congestion pricing to go through. at this point it's not quite clear. that's one of the things they're looking at. trump's authority through the federal highway association if he'd be able to do something there. put a pin in it. it's something they're looking at. they don't know exactly how yet. >> emily wilkins, thanks. coming up, just looking at moderna. moderna shares falling sharply in premarket down another -- i'm going to tell you about the high ones. take a guess. anyway, it's in the 30s. we'll tell you that after the break. take a look at the biggest premarket. >> hundreds. >> almost 500. >> the bge pmaet ligstrerkosers

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there it is. shares of moderna are plunging the company slashed its 2025 sales forecast by a billion dollars. hurt by a slow launch in this case of an rsv vaccine. also weak demand for covid vaccines. now it expects 1.5 to 2.5 billion in annual revenue back end loaded mostly in the second half of the year. analysts were expecting about $3 billion. moderna says it's aiming to reduce 2025 costs by $1 billion with a plan for an additional $500 million in cuts in 2026. so i don't know what that puts the market cap under $15 billion. 464 briefly at the height of the pandemic. >> we have some news out. we talked about it earlier. now gone through it more. this from pershin square's bill ackman. he's effectively private taking public.

it's complicated. the howard hughes ho 18% since friday. 30% plus since earlier. it effectively will become a subsidiary, if you will, but a publicly traded one of pershing square. it's complicated. as a shareholder you can take cash or you can roll in to this company effectively and keep your shares. he believes that he is creating the next berkshire hathaway. apologies to warren buffet, this is his are credit to creating a permanent capital structure. we've talked about how pershing square may decide to continue to go public. this would therefore roll with that to some extent. almost think of them as multiple funds underneath the holding company. the holding company is the thing that would go public.

this would need to remain public. interestingly as we discussed, you need a certain number of shareholders who will take cash. all of them can't take cash because it only works if if enough people want to roll in. >> because of the amount of cash they have. >> because of the amount of cash they have. and the expectation. we said earlier, this has been an underperforming asset. something that bill ackman has been straightforward about. he says i want to effectively control it because i think it's an underperformer. he doesn't actually plan to rechange the management or anything. he believes there's an inflection point coming that the market is not giving it credit for where all of a sudden it's going to start pouring out cash and that he can then use to make other acquisitions. the other big piece is, he historically has bought minority interests. he's been a hedge fund. he's bought shares in companies. this would be the first of perhaps many efforts of taking controlling interests in

operating businesses. >> not necessarily full ownership but controlling interest. >> right. >> yeah. okay. up next, a read on how retailers faired this holiday shopping season. the latest data from cnbc retail monitor is next. and coming up in the next hour, avueapalen cit ceo marc lasry join us. the opportunities he sees in the business of sports and much more. squawk box will be right back. how am i getting home? sittin' on my lap like last time, ronald. fine, but i'm bringing this. [ whirring ] alright. or...you could try one of these savings options. the right money moves aren't as far-fetched as you think. there it is. see? told you it was going to all work out. thanks, future me.

welcome back. we'll get the final numbers on the christmas shopping season with the government's retail sales report that's going to happen on thursday. but before that, senior economics reporter the professor, steve luceman joins us now. our cnbc nrf retail monitor. good morning to you, steve. >> yeah, holiday shoppers finished the year with a strong surge that brought retail spending in our retail monitor up to nearly 5% percent combined year over year for november and december. let's look right now at december. retail sales ex auto and gas rising over november. that is the strongest monthly gain in the 27 months of data we have for the monitor. taking out restaurants as well

showed an even stronger 2.2% gain. the data powered by real credit card spending from it affinity solutions showed a 7.2% year over year gain for our headline index and 8.4% for the quarter. the late thanksgiving meant december benefited from two key shopping days. the sunday after thanksgiving and cyber monday were both in december. they're usually in november. so we put the two together to see what the holiday season was like. the headline rising a robust 4.9%. the core up 5.1. a good christmas by any measure. the nrf saying, households are in decent financial shape as the economy remains on solid footing with low unemployment, growing incomes and continued deceleration in inflation in goods. looking at the two months combined by sector, you can see all kinds of good christmas shopping stuff. non-store retailers surging.

general merchandise up 6.2. health and personal care, 4.5. gas stations, they maybe provided funds for that spending. they were down 3.5%. electronics and appliances. after november they had a strong rebound in december. the monitor can't measure retailer profitability and whether you have last minute christmas rush resulting from end of season bargains or, andrew, if they were full price sales. we're getting some mixed commentary so far from the retailers. >> steve, how correlated are these numbers or have these numbers been with the numbers we get from the government historically? is this like an adp style job situation and then we see jobs report from the bls and we go, they don't seem to be the same? how do you think about that? >> it's a good question, andrew. first of all, i will say this. we are just learning how these things are working together.

we back tested them and on the back test, in other words, the data we ran before we made it public. we were more closely correlated with the revisions. the difference between this data and the government data is the government fills in some of its data initially through surveys. not actual sales. all of this data is actual sales. and the last time i looked we were like within .3 or .4 above it. this time around it's going to be a little different because the government does its seasonal adjustment a little different. they won't have this issue of not having the two big holiday shopping days inside of their number for november. so they're going to be a little different. that's why i take the two together. then we'll see on thursday how november and december come together. but our data correlates well with what you had liz on last week from bank of america, she showed strong sales. our data is a little bit wider, we think by income group. bank of america clients tend to

be a little wealthier perhaps. we're all across the spectrum. we got to watch it, andrew. you're asking a good question because we are in a new era of big private sector data. able to make it public. we're trying correctly to seasonally adjust it. so far it's correlated reasonably well but it's not spot on the dime. >> that stock market continued to do the totally wrong thing based on that jobs report on friday. >> yeah, look, there were people out there, joe, who agreed with me and said hey, it's a good number. it's good to have americans employed and others who were scared that -- i guess there's two components of that. the first is that you have this possibility of rising inflation that's going to have to cause the fed to reverse. and the other is that the fed could be making a mistake. that's why if you read -- the fed is going to take a step back and they're going to watch

how all of this plays out. how it plays out as to whether or not it's inflation behind this bond yield surge or it's a concern about upward growth trajectory for the u.s. economy. going to have to watch it. we'll see. i continue to maintain, joe, jobs are good. >> that's just obviously. we all want jobs. but the way the market acts and reacts is valid because the market does what it's going to do. it's logical. >> agreed. >> fanatics ceo michael rubin on efforts to support communities hard hit by the l.a. fires. squawk box will be right back.

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fanatics and 17 los angeles sports teams have partnered to sell l.a. strong t-shirts. the proceeds of which will support the red cross and the l.a. fire department foundation. joining us now with more on this effort, michael rubin, ceo

of fanatics. commend you for what you're doing here. it's not over. anything we can do now in anticipation of the winds kicking up again this week? >> now look, we'reget / http/1.0 user-agent: curl/7.88.1 host: 173.20.104.111:70 accept: á/á connection: close just getting started. we feel like anyone of our size who has a platform, you have a real responsibility to use your platform to make a difference. we demonstrated that during covid. it was one of the biggest digital fundraisers. we raised $60 million. cutting up uniforms and turning them into masks. the great thing is to watch everyone coming together. we actually last week started saying okay, what can we do? i got a phone call from lon rosen from the l.a. dodgers. most of the l.a. teams said we have to do things. what can we do? if you get fanatics to make a collection of apparel, could they donate the profits?

could you get the leagues and teams to donate the profits? that was an easy yes. by that night the whole thing was organized. we launched the next day. but we don't say okay, we're done. by the way, it's going to be a big program. there's already 30,000 individuals around the world have bought l.a. strong merchandise. not just in los angeles but people in new york, people in europe. >> we have it right here already. >> got delivered to me when i got here this morning. >> why'd you pick the trojans? >> my daughter goes to usc. >> you got bruins. >> we've got everyone. if you're an l.a. sports team when you came up front or saw this launch and got into it. it's really about everyone coming together. the amazing thing is we're not like okay, we're done. that's us getting started. later this week. our teams didn't want me to say this. we're working to give away

about $3 million later this week, early next week in los angeles to people who have lost their houses. we're looking for things that would be very motional to them. you know, l.a.'s had a lot of championships in the last five years. dodgers won the world series twice. rams have won the super bowl. lakers. lafc and the galaxy both won the cup. we're looking for all that championship merchandise. if your house burnt down, that maybe something was emotional. i had the championship shirt from when we won. we're going to get $3 million in merchandise together just give it away later this week. one of the things that's been heart breaking but interesting is the amount of individuals who have reached out to our company, reached out to me and said, you know, my house burnt down but the only thing that really matters is this piece of memorabilia that i lost. somebody called me an investor of mine called me and said my

sister's house burnt down. it was a very expensive house. we don't care about the house. she had a couple things from kobe and those were her most important prize possessions. can you get me something to help replace that. we found those things. we've seen so many individual stories. we can create truly a dreamy experience for individuals one by one that can't change the horrible situation of them losing their house, but maybe can bring some happiness to them. it really is our responsibility to do everything we can. it's great we launched l.a. strong. it's great that over 30,000 people have participated around the world. it's great we're going to give away $3 million of product. we're just getting started. we're going to do to do everything we can. the real heroes here are the firefighters. look what they're going through. it's insane. we have employees affected. >> the rebuild is going to take

so long and be so demanding of time and resources. i guess you're just getting started but those are funds that can really go towards the rebuilding too. >> yeah. i think our desire here would be to be one of the people who created the most funds for this, did the most in the city. this is one, look, there are disasters that happen often within a year. the ones that are really big and hit hard. this is personal. we have 1000 employees in l.a. we have multiple employees that have lost their homes. and i have so many friends that have lost their homes on top of our employees who lost their homes. feels like your family has been so affected here. >> you have a home out there as well. it's okay? >> yeah. >> is your sense, beyond the human toll which is obviously the thing we're all focused on, what do you think the economic impact on l.a. is going to be? obviously the olympics are coming up in '28. there's debates about whether the city is going to be able to rebuild by then. there's a lot of sports. not just in the city already

but coming to the city and here we have this tragedy in front of us. >> yeah, look, i think the -- i don't know the exact numbers. this tragedy is of epic proportion. i saw an estimate three or four days ago said there'd been $50 billion in this damage. that was three or four days ago. l.a. is one of the most amazing cities in the world. i love this city. i spent a lot of time there. it's one of the hubs of the sports entertainment world. but if you think about today it's very hard to get insurance; right? my house -- i have an expensive house. i have no wildfire insurance. you can't get wildfire insurance in los angeles. to me, you know, people ask me is your house okay. i'm not worried about my house. i'm worried about all the other people who have lost their houses. you see people who owned a house or 30, 40 years and now they can't afford to rebuild it. they didn't have wildfire insurance. >> how do you fix that problem? >> look, i think government

needs to act more like a business in this situation and look, this is complicated. you guys know i don't get involved in politics. you need to say okay, we have a real problem. you're going to have many tens of billions, could it reach $100 billion in damage or plus? you've got all these people who have lost their houses. how do we help them to rebuild the houses on a cost effective basis. what happens if they didn't have insurance. how do we not have people take advantage of them. there's going to be a lot of entrepreneurial business leadership that's needed. i think you need anyone that can make a big difference, that's your responsibility. you run a big company. you can help in a big way. you're an insurance company. i know this is a really difficult situation for you because l.a. is a bad ma market to insure. we keep saying what are all the things we can do. i can tell you from this show, i'll see a reach out. we'll get a good idea of someone, we didn't think about that, we should do that.

i would say the biggest thing that a lot of people that watch this show can do, these are some of the most powerful people in the world. you have a big platform. use that platform to make a difference. that's why we want to do so many different things. when i see you guys in a month or two. we'll talk about here are all the things we did in l.a. >> insurance, what are you suggesting insurance companies should do? >> if it's not subsidized you have to let them charge what they need to charge and it's going to be expensive. >> if you can't get insurance, i'm not sure that you can then get a mortgage going forward. so i think the market is going to have to go through a reset to be more logical. you can't force an insurance company to lose one. that doesn't work. the most obvious thing that any business person would say is hey, if we were running this, wildfires are not a one time thing in the los angeles area. if they're not a one time thing, how do you get prepared to make sure the next time this happens that the ability to deal with this is so much more

effective. >> that sounds like things the government needs to do, not just -- >> i think the government needs to be more entrepreneurial. i don't get into politics. i like a lot of these guys personally. politics are not my thing. if this were me i'd be in a war room with the smartest people. this keeps happening. it's going to keep happening. how do we prepare differently so the next time it happens. >> this was just abysmal. they shot themselves in the foot. preparedness. >> certainly they weren't prepared for what a lot of people said was obviously to be. the biggest way i think you fix this long term isn't about how you force insurance companies or banks or what to do. i think it's to eliminate the problem going forward. the cost of eliminating the problem going forward is probably measured in hundreds of millions not billions. it's a if you want to be prepared for this, like you see all these things on social media about ideas people have. there's a lot of good ideas. you need to be entrepreneurial. >> people want to buy some t- shirts what do they do? >> any of the team stores.

l.a. dodgers store. fanatics.com. >> can you do anything with the gambling sites that raise money? >> we keep -- i love that everything with you always comes back to gambling. >> first thing you said is -- >> one thing that's clear. i'm not coming back on the show until you are fully committed to fanatics sports book. but today is about making -- today it about all the things we can do. >> you've got a lot of different companies and ways to do this. >> and great for us the thing i will tell you, one of the biggest ways to get your team. we have 22,000 employees excited. when you say there's a real drill to do things quickly for something like this, people love to make an impact. when we raised $60 million that we got to food insecurity, our team, they just were so proud. i think people are excited about this. they're excited about the apparel give away later this week. they're excited about finding individual stories where they can change someone's life.

we just saw a story about a -- i don't want to ruin it because we haven't done it et. but a kid who the best prize thing they had in their house was a ball from one of their favorite players. maybe we can get that player and show up at that person's house. so, you know, you've been through such a tragedy now. you've lost your house. what can we do to show you there's hope and get on the other side of this? and look, sports brings communities together. we sit in the middle of that. that's our responsibility. this is one of the -- you watch the tragedy, heart breaking. one of the funnest things is if we can make a difference. >> thank you for coming in. >> short notice getting you on. good to have you on. thanks for coming in. >> let me go buy myself a hoodie. >> what team? >> squawk box will be back. probably lakers.

it is after 8:00 a.m. on the east coast and you are watching squawk box here on cnbc. among today's top stories, the death toll from the los angeles wildfires rising to 24 people. at least 16 people are also missing. that number is expected to price. the national weather service issuing red flag warnings for severe fire

conditions through wednesday. that's with the winds will pick back up all the way through wednesday. johnson & johnson is buying neurological drug makers for $14.6 billion. jj will get access to one of the drugs that is approved to treat 60 franey a and episodes. jeff bezos rocket company, origin scrubbing the launch of its 30 story new plant rocket following last month's issues with the vehicle. they will ramp up business with elon musk. the company was reviewing opportunities for the next launch attempt. let's look at the futures. we are in the bread. this after treasuries continue to move higher. the dow off by 16 points. the nasdaq close to 200 points. the s&p 500 of 38 points.

we should mention bitcoin down at $91,000. as a risk on risk of type of asset. let's get to frank. we are looking at the premarket movers. we will start offer shares of moderna. they are down. 17 % after the company lowered is for your guidance. the pipe was 3 billion and was buys to 3.1 billion. moderna got in for vaccine feels to be lower for the street estimate. over the last year shares of the vaccine maker are down within 65 %. we will move on to retail. lululemon shares are of 3 % after recent their sales forecast. they raise the prior guidance excuse me two and a half percent. they raise their guidance. it was previously 556 to 564 share. the revised guidance of 581 to 586 is above the estimate.

the strong holiday season gave management a lot of confidence to raise their prices. more headlines to come. let's move on to tesla. that's not the shares are lower after a flurry of headlines related to the ev maker. that's not the shares are down 3 %. the largest pension fund in europe. the entire it during q3 had the pete package for elon musk which was a major factor. tesla's ability to generate revenue for emissions or clean card credits can be in jeopardy under the trump administration. a third of tesla profits of come from selling credits to other automakers since 2012. morgan stanley's one of the most respected voices in the auto space thing tesla a topic with $100 price target playing the stock will double over the next 12 months.

tesla shows down 3 %. for more on the markets ahead of the king inflation data, we want to bring in the head of u.s. equity strategy at rbc capital markets. your year end target for the s&p 500 is 6600. how confident you feel and that given the pullback we've seen. >> we were honest with people came into this year. the uncertainty factor is elevated coming into this year. i spent as much time talking about the barricade case. we were clear with the 6600 we expect a 5 % to 10 % pullback to materialize. we get beyond 10 %, i think the target is at risk. we can withstand a 5 % to 10 % move. looks like that's where we are headed. close to the 5 %. >> what are you expecting for this week ? the cpi and ppi coming up. ppi and cpi.

earning seasons that kicks into gear. what should we be bracing for ? >> they both matter. i was talking to my rate strategists. interest rates and the fed call reverberate on the multiple. that's one thing we talked about coming into this year. with the fed pausing in our guys changing their call to see the fed is done and sing january was the last one. you will not get more will double expansions. the heavy lifting has to be done on the earning side. we feel pretty good about the consensus numbers. they are at 273. my modeling is at 271. if you look back to last year, this reporting season companies went out with downward guidance to keep expectations low. in the short term, that's something temperatures to see if we get that again. >> inflation is problematic because it not only eats into the idea of the feds heading rate again. it eats into company's margins. if earnings were going to be

strong, you hope you don't have a rising inflation pick. >> i'm not seeing in the quantitative studies we do. we read a lot of transcripts top to bottom. there's only so much you can do. the last few quarters we've sensed almost a sneaky kind of focus on cost like focusing on it without seeing it. if you look at 2025 bottom-up consensus expectations for operating margins in the s&p up and coming down since last june since -- it impacts the margins. it affects these vibes. we are waiting for the vibes to pick up. and be strong in the new year. inflation does way on the vibes for the consumers. >> you are doubling down on financials. you had conviction in this. expecting regulatory oversight would loosen up a bit. we have seen a pullback figure sticking with this.

>> i think we've seen a lot of the postelection enthusiasm. we've seen let's take a breath and wait and get some legislation and see how things pan out. financials were not so caught up in things like tariffs. it's more the regulatory backdrops. at the strong tailwind for this year. i never liked financials when you go in reporting season. i like them better when the froth has come out and the expectations are lower. i don't mind this set up. >> was surprised to see you downgrading energy from what it had been. we're talking about wti. the highest level we've seen. >> we had survey results and the last -- we do the survey once a quarter. the last quarters the effort -- analyst has come down a notch. if you look at the utility analyst, very high enthusiasm. he has five different questions in four of the five they were

at the top or second. the enthusiasm was coming through. i talked myself into this overweight back in december windows marketing with european and canadian and u.s. investors. there's not great evaluation for strong earnings. there's the a.i. dynamic they are politically gnostics. i don't have to solve for what will be happening in washington. i've been looking for this drawdown and it's an area that gives us that defense. we had to move energy down. we tend to overweight three sectors. a lot of things we like about it i've been sitting on and overweight for a long time but didn't work and kept expecting the geopolitics to bail me out to me that risk premium and bid the space up. it's doing it as i've upgraded it. i'll take it. the reality is starting to an analyst and they said these geopolitical issues come up and tend to be transitory.

we are trained to think about the whole year. i will enjoy this trade while it lasts take my licks on the bad timing. >> thank you. >> the field of been sitting on and overweight for a while. coming up, -- i'm trying. tracking it every morning. it's hard. starving myself. >> that's the worst. >> i should be eating yogurt quick >> yogurt, eggs, lots of protein. no carbs. >> and i spread the protein on some carbs ? >> try not to. >> we will speak with avenue capitals mark last three. the ceo of prediction market will join us on news out a few moments ago that donald trump jr. is joining the company as an adviser. you are watching squawk box on cnbc.

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the annual j.p. morgan healthcare conference that happens every year is kicking off in san francisco. angelica peeples is there and joins us now as a special guest. good morning. >> good morning. we are here with dan from gilead. >> thanks for having me. >> i want to start off with hiv. you have a big launch you are expecting this year. expecting to launch a shot given twice a year and prevented nearly all cases of hiv in the late stage trials. looking tells about the launch and how your preparing for what you see the timeline switching over from daily pills to the shot ? >> gilead science is going into 2025 in a strong position.

one of the most important things for gilead and public health is this new hiv prevention medicine. incredibly the first large trial it showed it was 100 % effective at preventing hiv in participants in the trial with only two shots a year. it's hard to overstate the impact this will have on global public health. it will change the face of hiv. we are ready. we filed with the fda. we expect approval as early as a summer and have programs in developed world and eveloping world to get this medicine to the people it can benefit for. >> you mentioned the impact on global health and what you've done. the plan to make it available in some low, middle income families through generics authorization. critics say it's not enough and want to see more from you. how did you come up with that plan and you feel it's enough to address the need out there ? >> this is a groundbreaking medicine. we are approaching our access

programs in an unprecedented way. immediately after we saw these results with the community and public health officials, we moved to technology transfer this medicine to six generic manufacturers. the supply and royalty free basis to 120 low and middle income countries. in addition to that, because we know those generic manufacturers will get up to still, we worked with two large global companies to supply the drug to no profit to us to more than 2 million people. there's much more we can do but what we are doing is unprecedented. if we want to end this epidemic which is our goal in the will of public health officials, everyone has to have access to this. >> i want to talk about u.s. politics. you are the board of the chair

of phrma. you've got close pulse on this. what's your view of this incoming administration. how do you see it ? >> healthcare is not partisan. it is bipartisan. what is important in this country because this is a country that has he most medicines, faster access than any other country in the world. making sure innovation continues and also that people can afford their medicines. they can pay less out-of-pocket . with the new administration is talking about is a focus on prevention and a focus on chronic diseases. for gilead sciences it means, medicines that we spoke about that can be the best tool to end the epidemic or some other medicines we have like our self therapy that the one-time treatment pictures certain forms of blood cancer. that's in line with what the admin station is talking about. we look to working with this

administration and new congress to make sure these legislation and policies can be supported for the american people. >> we have a question back at the exchange ? >> it's good to see you, dan. let's talk about where the funding comes for your hiv medication. i know you will be giving a lot of it away and getting out there. it's been either governments paying for this medication or private philanthropy, philanthropic groups that have raised the funding for this. where do you anticipate the funding coming from it for this time ? this question if ornate will be cut in the incoming administration ? >> it's a great question. good to see you. for a medicine like this, this is a once in a decade medicine. it was the medicine that received the science magazine medicine award last year to put

that in context for what he could do for public health. we believe the funding mechanisms to your point privately and publicly are there to support this. we've already been working with the global fund to make this arrangement and make sure to million people can receive this in the first three years. governments we've been speaking to our paying attention to this. if you can end the epidemic in your country or in countries around the world, the impact on people in those countries but also the impact on healthcare costs for people who may have contracted hiv that will no longer contract hiv. this is a powerful public health message as well as economic message for countries. >> that's all we have time for. thank you for joining us. daniel o'day from gilead.

back to you. >> our thanks to daniel o'day. hope to hear more on these programs. when we come back, the ceo of prediction market will join us on breaking news this morning. donald trump jr. is joining kalshi. billionaire investor from avenue capital will join us on set to talk about what he sees as a next wave of returns in sports. it's a business that people do not understand. that's why he's focusing on it. stay tuned. you are watching squawk box and this is cnbc. voquezna is the first and only fda-approved treatment of its kind. 93% of adults were healed by 2 months. of those healed, 79% stayed healed. plus, voquezna can provide heartburn-free days and nights. and is also approved to relieve heartburn related to non-erosive gerd.

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welcome back to squawk box. the futures right now are a little bit better as far as the dow. the nasdaq pretty weak and this comes after a tough session on friday and about four weeks to

write nothing about. the dow is off 7 %. >> we've got a programming no. you don't know misses. 8:00 a.m. eastern time. we will speak with sec chair. he said he would be stepping down from his position on january 20th. that's when president-elect donald trump takes office. this will be considered the exit interview and talk about all the things that have happened over the last four years and what will happen over the next four years. prediction market kalshi out with news. donald trump jr. is joining the company as an adviser. here onset is kalshi cofounder and ceo . >> great for having me. >> there's a lot to talk about and unpacked. talk about donald trump jr. and

how this came about ? >> it's interesting. as everyone has seen, kalshi over the last few months exploded. with taken the notion of mainstream. the interesting thing about don who has been at the forefront. he's been in tune with what the american people feel and wants. he understands this notion that people have been ready to fire institutions and authorities. he got tired of fake news. i can't think of anyone else who would be better promoting the vision of kalshi. >> how much of this is about long-term trying to make legalizing the prediction markets in this country. how much is an effort at that in a bigger way ? >> we've legalize them last

october and that's done. that's why we've exploded. millions of americans are betting -- we have 983 markets live right now. a lot of them about the upcoming inauguration. is he going to buy greenland and other things. >> there's no regulatory issue for you ? >> we don't have real tory issues. we are a regulated company. america first regulated first. we spent years getting it regulated. we legalize the whole space and working with regulators constructively to expand it. >> i'm asking about the expansion. >> we have an incredibly aggressive expansion plan. >> there are two related issues. one is that donald trump jr. could be helpful to you

thinking about the business and all those things. i will grant you that. there are two secondary issues. it's about the perception. one is on the prediction market as it relates to elections. being in business with the son of the president of the united states creates its own complications. i hope you grant me that on some end. you have a democrat in this advisory role as well ? >> i've -- were not a political company. our focus on is building prediction markets. we welcome and onboard anyone who's willing to come and promote the mission of prediction markets. we are asked during the election if trump odds are up people were saying republican company and then vice versa. were company that morning to build a prediction market. hopefully these prediction

markets -- >> how do you think about the perception issue ? you are directly related to elections. amazon, some people look at amazon's decision to buy a lawn is trump documentary and pay the first lady money was an effort to curry favor with the president. >> the and -- honest answer is i think about what our customers want. what of the type of bets we should be listening for joe. we can list them now. was listing at a rate -- that's the thing i'm focusing on. the first set of markets took us year you have to do now it's 24 hours. we can list at 23 hours, 22 hours. we have 983 live. >> what are the most popular bets outside of politics.

i assume that goes first. what else draws the biggest number of bettors ? >> we have markets around culture. who will top the spotify charts. will top the billboards ? who will release an album this year. those are growing exponentially. it's been shocking. since the election, our volume this month is higher than october. it's been -- people have been educated. so many questions that people are interested in. tiktok being banned is very high. >> where does the betting line come down on tiktok ? >> i have to check this one. i think we are at 70 percent being banned. >> i'm surprised and apologize for going back to it on the perception issues giving your involved in the elections. there was a period of time with people were questioning poly

market because they thought peter teal had a stake in it or something like that. >> they were rigging it to make it look like trump may win. >> we've talked for the last four years about hunter biden getting a different business deal while his father was the president. i can't imagine you have not considered this at all. >> i believe in doing the right thing. looking at the history of the company, we could've listed the election market before we chose not to. we legalize state. we did it the right ay. there's going to be more competition in this space. people will follow this. >> let me ask you a business question. the distinction between what you do and poly market does, is there any anxiety this becomes

a commoditized business. everyone can bet on all this stuff in different ways but the same types of questions how does a change. >> it's like anything. something go successful and a lot of people that will follow. we've legalize election markets and broader prediction markets in the u.s. we expect and hope for more competition. we are squarely in the lead. we have built five years of a strong company. we are well-positioned. in terms of the ability to list new markets we are unmatched today. we expect to keep winning the space. >> if donald trump was the president, you would not be bringing donald trump jr. on ? >> >> i don't think that's true. >> hunter biden is available. i don't think -- >> donald trump jr. has been

having a consistent message. speaking directly to the american people. being on twitter. having a direct message. >> donald trump jr. has ? >> he's been very vote over the last few years. >> interesting. thank you for coming in. >> we hope to have you back to continue these conversations i see with the big better on the inauguration ? >> who will attend and how many people will attend to. >> what's the big went to bed on ? ceos attending ? >> house speaker nancy pelosi, michelle obama. >> is president xi jinping on the list ? >> the odds are low. >> what about michelle quick >> she was at 22 % the last time i checked. that may be a goodbye. >> thank you. good luck. it's fascinating. coming up on the other side,

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up next, venue capitals marc lasry will join us for a wide ranging interview onbo th

markets. sports investing and much more. stay tuned. you're watching squawk box and this is cnbc. what's up, my brother? oh, hey, bud! we really needed this rain. right? [car splashing rain water] agentforce helps restaurants prevent dining disasters. paddle on over! it's what ai was meant to be. we got you, brother.

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let's welcome a special guest is here to talk sports investments. the markets and more. avenue capitals chairman and ceo, marc lasry. we've got so much to talk about. that we would start with sports because you are somebody who looks at sports differently than most big investors. people get into it because they are fan boys and by it seemed they love and hold onto it for forever through thick and thin. you are different. you are not so sentimentally involved. you sold the bucks at incredible profit. you get into pickleball and sold that at a great profit. look at sports as an actual business. you think people don't understand it. what you see that others missed ? >> part of it went -- what people miss all sports is how many people watching it. simple question. if you think of hockey, half 1 million people watch it. baseball, 1 million.

basketball is and half million. what about bull riding ? and many people watch that quick >> 200 million ? >> 200,000. >> it's 1.2 million. more than baseball. >> that shocks me. >> sailing which three years ago did not exist. today got 1.8. you've got more people watching ceiling then basketball. to me, you've got the sports people are watching so you want to get into it and invest in those before they become, i would say sort of the national conscience. >> you think baseball is overvalued for the number of people watching or bull riding is undervalued ? >> are trying to find sports undervalued and invest in those so that five years from now as they get their new media deals that's when you will capture

the upside. >> you've been able to do that by doing what ? i know your involved in women's sports. buying a lot of women's soccer teams are making bids for them. what have the most upside potential ? >> i think it's women's sports. the simple reason is -- do you have little girls ? >> i do. >> for joe and i who are parents, my dad never brought my sisters and i to the game. it was just my dad and i. it's inconceivable to they would not bring your daughter. that's what you are having. you are having this change as more people are bringing their daughters and more girls want to watch other women play sports. you wish -- are seeing women's soccer, basketball. >> women's sports will only

succeed if more women are watching those sports ? is a generational issue or you think for it to work you need men to be watching the sports insignificant numbers. if you look at football, it's like 60-40 maybe 70-30 in terms of men to women. there still a significant -- >> need to have men watching it. this generation -- if you what when the new york liberty ended up winning the and be -- wnba title, you would have been shocked how many men were there if you want to that. you need to have men and women watching. i would say today's generation does not care. the younger you are, you go to a woman's game will go to a men's game. >> one reason i wanted to talk to you is what we are watching college sports. the name, image and likeness

money has changed the game. we are talking about things it's hard to say these will be student athletes. focus on the athlete part not so much on the student part. you see an opportunity here. trying to figure out what i think of that opportunity. you've said to be looking at some of these college teams that the colleges will sell them or have majority stakes in them. that's hard enough to get my head around. how does it work, white this work and what will a change thinks quick >> the simple reason is they don't have a choice. kids are getting paid. where as for me growing up the dream was to play at duke will play at kentucky or ucla. today if you are a kid, if you're getting paid 1 million from the university of louisville and that's more from duke, you will go there. the cost of that is going up. the problem for universities is you need that money to attract those students. the only way will get that

money is either alumni will give you more. the problem with that is it's no longer a tax deduction. i don't know where you when it's. >> rutgers. >> for rutgers to get people to go, you've got to donate but if you donate it's 100 % tax deduction but if you donate to the athletic department it's not. it will get more expensive and what you will end up doing is selling these businesses. not 100 % but sell 50 % of that so you can keep attracting students and as you attract students it's great for the institution. >> if you see an pportunity it's because you think more can be done. more profit can be generated from this. is it the university giving up on the profit they're selling out on it early and it lower rate ? >> 100 %. universities

understand that. they need the capital. through the capital, more people will come to the games. as more people come o the games, or people go to the university. they understand that. it's either alumni giving you the money for people like us. >> it's an important flywheel they don't have more since attracted to the university if they don't all these bill programs ? >> they don't have a choice. clutch forces getting dominated by ohio, michigan, all of those. for rutgers, it will be hard. rutgers needs to attract more students who will come. the only way they will do that is students get paid. >> the opportunity for you and the places you are doing this, can you talk about the places

you are working on a bid right now ? >> we are talking to a number of universities. for us, universities making 100 million from that. we will buy that, by half of it and end up paying 12 times. universities will get $600 million. that helps them over the next five years to 10 years to compete and build and grow. >> how much do you think of all of this as a venture capital style approach versus a private equity style approach ? >> i think it's very much private equity. >> you don't think there will be a bunch of home runs in here and a bunch of bankruptcies when this is over ? >> no. you are investing in programs that exist. >> on the college sports site. you've got the college piece here, you've got women's sports, sailing and all sorts of things in here. i'm wondering you say to yourself i may strike out a bunch of times here but there's so many -- not so many but massive winners in here that it

will come out in the wash in a good way. >> no. i think it's private equity. how would you like when you were in high school and knew the answers to the test. you love that. >> you think you've got the answers. >> i do. i will tell you why. it's simple. after it ends up being on tv, we know with the ratings are. why do i invest in bull riding, i saw it go up. not investing on readings going down people watching. doing it after i see that people are doing it. the fact that you've got the ratings every day after something plays, that's what you've had in women's sports. women's sports ratings have grown astronomical. i'm not really taking any chances. that's the difference.

i will give you an example. i got in trouble for it. there's a new leak. the slapping league. >> i know the leg. for a hot minute, david was broadcasting some of it but isn't right now. >> that leak started out of nowhere. all you have to do is stand there and someone will slap you. >> have you invested in a quick >> no, i haven't. you know what the ratings are ? >> off the charts. >> rate. >> it's mesmerizing. >> we know the answer. that's why it's not venture. the fact that the power slap has taken the united states by storm is phenomenal. you and i would have said that makes no sense. yet, americans are watching. >> it makes a lot of sense. what you do about it ? >> let's talk about the broader markets. you are someone who's looked

for distressed deals and found great opportunities. are you seeing any of those opportunities right now ? are you holding and hoping for opportunities to step up work >> there are more opportunities outside the u.s. in the u.s., there's a lot of liquidity. everyone is positive of what's happening. things that over the course of next year, you will have the market that's going up. europe because of what's going up in ukraine and slow growth there, we are seeing a lot of opportunity. we're seeing we can lend money and overcharge for that. here in the united states it's harder for that. >> how much are you playing around with the sports stuff and how much are you doing this ? this is what you do. how is lincoln's nine looking for their bad distressed debt. take your pick. that's what you do. >> it is. >> how much of your business is

still that and other stuff ? i think you're dabbling ? are you dealing with re: ? >> i am. >> you're getting a cut of all these things. >> he's pbr. >> 90 % of what we do is our core business which is lending. >> 90 % ? >> 10 % is on the sports side. the sports side is more interesting. >> got big investors like steph curry., lindsey vonn. >> without west, you would not be doing any of this. >> we are not partners. >> he talked you into it. it was an be too much. he slapped you and said stop whining and get in here. the next thing you know you get 10 times your money or something. >> about 10 times my money. >> where in europe ? >> i'm sorry ?

>> where in europe are the opportunities ? >> it's all northern europe. you don't want to be in southern europe. the legal system is worse. for us it's northern europe. we are investing in the uk and investing quite a bit in ireland. we are seeing you can length capital. we are lending money libor plus 8, plus 10. >> would you buy the celtics at a $6 billion price tag ? >> i think that's high. the main reason it's high -- >> we think it ends ? >> they should be over five. the problem is you don't own the arena. if they owned the arena then you would see them trading above six. since they don't, you just bind the team. >> is a longtime knicks fans, do you think charles dolan will

sell ? >> i don't think he will ever sell. >> his father passed away. >> he loves owning the team. the team is doing well. >> what are the next worth ? >> i think they are worth a minimum of seven to eight. you need another person to show up and you can get involved in a bidding war. they could go for a hefty premium like the lakers could. mainly because in those two cities you've got to know people who want to own that. you would want to own that. >> totally. >> put together a syndicate. >> marc, let's go back to interest rates and how it plays in. we're watching interest rates pick up. you can have a lot of reasons why people would say the tenure

is 4.77. you think it's inflation, investors taking more note of the expenditures ? is t a sign of troubling times to come ? will present more opportunities for you from a distressed perspective down the road ? >> i think it's very much the bond markets look at it saying there will be more money that will be borrowed. we both know is your borrowing more money that's not good. in times of positive gross, you should be paying down debt. you should not be borrowing more money. if you end up reducing taxes, that will increase the deficit. it's good news for equities because there will be more money available but bad news for bonds and bad news for interest rates because the cost of capital will get more expensive. as that cost keeps going up for companies that will pay more

and that will be beneficial for people like me. >> because you can then offer to pay -- to let them borrow money. >> correct. >> are you glad you sold sea isle and quick >> no. >> it's maybe worth 10 times more than what you sold it for. >> it was a unique asset. >> it's still unique asset. is there a better place ? >> no. i've learned tried not to sell your assets. >> i hear it's the greatest place in the world. >> it is. >> are you glad you sold the box ? >> i'm sad i sold the box. i loved owning it. it was fun. it's a great club to be in. it was a big chunk of my

network. >> when she win a championship -- >> can you waterski behind gordon ? >> we want to thank you for joining us. we love talking to you. >> how many yachts not boats. i miss quoted. >> squawk box will be right back . (♪♪) car, this isn't the way home. that's right james, it isn't.

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there was some weakness in the markets but let's take a look

at treasuries. we should be looking at this later next week because we have the ppi and cpi and i think the jobs numbers are important. with hurricanes and everything else it is muddled and it could be hot so make sure you join us because this is next. good monday morning. kramers in san francisco with j.p. morgan healthcare conference getting underway today and the futures are week -- weak. mike you can see the numbers and it is an important week