details straight ahead. it's friday, january 17th, 2025. "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. and if you take a look on this friday morning, we are in the green. if you check out the u.s. equities. dow up 135 points. dow futures up triple digits. up 100 points. you have the s&p 500 up 22 points. that comes after some dow actually broke a three-day winning streak along with the s&p 500. dow yesterday was down 68 points. s&p was down .2%.

nasdaq was down .9%. you are still looking at stocks for the week since the beginning of november. the big gains across the board. s&p is only about 2% from the all-time high. the dow and nasdaq close to the all-time highs. the russell 2000 was down in correction territory, but now only off 8% from its all-time highs. yesterday, big tech was dragging the markets down. apple was off 4% on reports of lackluster iphone sales in china. tesla down more than 3%. nvidia slid by nearly 2% and if you take a look at the pre-market move in the three stocks this morning, you will see they are rebounding a little bit. tesla shares up .75%. apple up .50%. nvidia shares up 1.2%. and treasury numbers with the news that was better than anticipated.

you are looking at the lowest levels. two-year sitting at 4.23. finally, bitcoin which traded so closely with the tech stocks is back above $100,000. $102,000 this morning. did it is a gain of 9%. >> united health was yesterday. >> it was yesterday. >> 32 points. 67 on the dow. 32 points united health. more than 100 points of downward pressure. >> would have been higher. again, for the week. it has been a pretty good week. >> nasdaq was not good yesterday. meantime, israeli prime minister benjamin netanyahu say a cease-fire deal has been met. the cabinet convening to discuss the deal. if it is approved, it will go to a broader cabinet for a vote that could happen tomorrow. netanyahu said they were preparing for the deal to take effect and for hostages to be

released as early as sunday. in a test flight, spacex starship spacecraft broke up after launch yesterday. it says here, there were no people on board. thanks for that. the company confirmed the spacecraft was destroyed and said initial data indicates a fire developed and it would continue to investigate the root cause. spacex said the debris fell in the tlantic ocean within the predefined area. the faa warned lots of falling debris and flights delayed. the rockets super heavy booster successfully returned to land at the launch site. >> it was caught from -- >> with the chop sticks. >> at the launch pad. >> watching it almost like a

really good fireworks. spacex is a weird business. these things are so big and expensive and technologically advanced. i saw ron yesterday. >> ron baron? >> yeah. talking about what he thinks spacex is going to be worth. it will dwarf tesla. it was a multiple of what ron thought. you need a lot of capital to do this. >> jeff bezos told me he thought that blue origin, his company, would be worth more than amazon. >> which is worth a lot. >> yeah. >> it's a science fiction future. it's thinking about -- they liken it to the arctic. if we have an outpost in the arctic, you can't go outside. you can't do much up there. not much different than the moon. >> correct. i felt better if something went wrong. i guess you are in just as much

trouble if something goes wrong. >> unless you can go to the part of the u.s., greenland, on the way down from the arctic and stop by there at trump international hotel. >> oh, boy. the supreme court could rule on the tiktok ban. it would ban the app on sunday without intervention if something doesn't happen earlier. biden administration doesn't intend to enforce the ban before leaving office and allowing the incoming trump administration to handle it. trump's advisors are looking to push back the deadline if the supreme court allows the ban to proceed. that was the indication from the questions the justices were asking during the case. reports say tiktok will go dark in the u.s. when the clock hits midnight. the law doesn't require them to go dark. they could allow the app to continue to work, if you will,

just not allow it to be downloaded or update it in the future which would give them more time. there's a question whether they are doing this also as a bit of a negotiating ploy to force the issue a little bit differently. >> look, there's a question if the incoming administration would enforce the law, but that puts the issue back on the big tech companies, apple and others, are you going do something that's against the law if it is not being enforced and will you be held to repercussions down the law? there are laws on the books that are not enforced, but a public company violates a law, you may be responsible down the road. >> what did the famous timothee chalamet say? >> that was bob dylan. >> that was actually bob dylan. >> the winds are a-changing. >> tiktok isn't going anywhere.

that's what i thought yesterday. instead of being concerned about the tiktok ceo, i thought you would take credit and embrace it. you told us all along it was not a security thing. >> i have said -- i have said from minute one that all of this is a complete farce. it's a farce. >> why let this guy come to the inauguration. i would think you would say, see, andrew ross sorkin nailed it. it's not a security risk. it's a business. >> thank you, sir. >> you still used it. >> no, the reason is in this case, we had a senator on the broadcast who voted against it and believes it should be banned and it's a national security threat. my question is if, in fact, you believe those things -- >> i know. >> -- then you have to believe the ceo of tiktok is a national security threat himself and a spy. >> right. i got you. >> i don't necessarily have to believe that.

you have to believe the chinese government can do what it wants. >> it would be better if it wasn't owned by the chinese. >> not necessarily the guy is a spy, but reality any company in china has to do what the chinese government says. >> let me say, i have known him for a long time. i do not think he's a spy. i think he's a regular ceo like any other ceo. i don't think the company is a national security threat. i think everybody out there saying this is wrong. i'll put on the table. if you actually -- >> i want you to do it. >> my view is take one side or the other. really take one side or the other. don't say it's a national security threat because trump says it's okay. that's what i will say. >> things can change. >> i don't know. i think there are things the senators who voted on this know we don't know. i haven't been involved in the

briefings on this. i do think any company that does business in china -- a chinese company has to do what the cccp has to do. >> look what i said. >> by the way, if it is not a big deal, why are they so opposed to selling it? >> what i will say is could it be a perspective threat? sure. is it an actual threat as if they are doing some nefarious right this minute under the direction of the government? no. >> you have more confidence than i do. >> if they want more information about what the youth in the u.s. are doing -- they're welcome to it. nothing that interesting. they're whack os. >> you don't think there is a way to influence? >> the way they are influencing, i'm not sure it would be worse coming from china. >> if you talk to jonathan greenblatt, crazy with the october 7th not a big deal.

>> youth is wasted on the young. >> we're all old cranks here. in inauguration news, elon musk will speak at a rally for president-elect trump sunday in washington. a source tells nbc news that other speakers include jd vance and dana white and retired wrestler hulk hogan and members of the trump family. performers are village people and kid rock and billy ray cyrus. on monday, the markets are closed, but cnbc has special coverage at 8:00 a.m. eastern time. it is a six-hour affair. special guests are investor stanley druckenmiller and pfizer ceo albert bourla and walter isaacson and walmart ceo doug mcmillan. it starts at 8:00 a.m. monday morning. it's going to be a long running

affair. in the confirmation hearings, scott bessent backed the extension of tax cuts from trump's first term. >> this is the single most important economic issue of the day. this is pass/fail. if we do not fix these tax cuts, if we do not renew and extend, then we will be facing an economic calamity and, as always, with financial instability that falls on the middle and working class people. we will see a gigantic middle class tax increase. >> bessent outlined the rationale for imposing tariffs on our trading partners. >> the american people should think about the tariffs in three ways under the trump

administration. one for remedying unfair trade practices by industry or country. the chinese tariffs, the steel. two, maybe for a general tariff as a revenue raiser for the federal budget and, three, donald trump has president-elect trump had a third use. >> bessent says the federal government should be independent from the executive branch. we will have more on the bessent comments throughout the morning. there were mic drop moments like oligarchs. i think he is above 90% on the betting markets. >> he has been for a while. >> yeah. i don't know how many nays he

will get at this point. i watched his son, coal. i'm interested. i swear. i am. >> and the dollar. >> he was -- i think he would have looked, they caught me dozing, he would have been interested. anyway. when we come back, the big take aways for are investors from this week's earnings and inflation data. that is straight ahead. later, an exit interview with white house adviser amos hochstein. he will weigh in on the israel and hamas cease-fire dl. we have a lot to talk to him about. "squawk box" will be right back. . ellen and i want to go on vacation, so i'm going to go back to last week and buy a winning lottery ticket. -can i come? -only room for one. how am i getting home? sittin' on my lap like last time, ronald. fine, but i'm bringing this.

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faster and easier than ever. that's what i do. is that love island? the futures this morning are looking up a bit. dow futures indicated up by 135 points. s&p futures up 21. nasdaq up over 100. joining us right now is chris retzler. the portfolio manager. chris, the small caps have struggled while other indexes have done pretty well. i will say this week, it has been four days in a row the russell 2000 has come out of correction territory. what are the potential challenges ahead for small caps

this year? >> we spent the last two weeks meeting with small-cap companies at ces and here in new york. i think what managements want to see is certainty. we're going to get certainty at some point in the next, you know, couple of weeks, couple months. i think once they have that direction, you will begin to see an acceleration hopefully as the market broadens out and there's more confidence in where they can see opportunity. you know, at ces, we saw a tremendous amount of innovation. we are seeing it in electric vehicles on a global basis, although it is a little held back domestically. globally, it is moving fast. we are also seeing innovation in new products and materials and semiconductors. there's still a lot of investment going on and we think that trickles down to smaller cap companies. we also see infrastructure is another big place that we're hearing about data centers and lack of power.

there's money -- >> opportunities for small businesses to jump in and fill some of these problems? >> correct. if we are going to continue to re-onshore, we need more infrastructure. >> let me ask you about rates. that's been the easy macro story with small caps for a long time. the good news was federal reserve was lowering rates and that would trickle down to companies with not easy access to capital. with the fed looking like it is on pause for now, what does that mean? what's the access to capital for companies at this point? >> so interest rates are higher, but the interest rate curve is hitting healthier. you have the rates on the long end. there is access to capal for lending and regional banks. would we like it to come down in the 10 and 30? certainly. we have to figure out the deficit spending and demand for

the bond market out there. again, i think those are policies we will begin to see over the next couple weeks and couple months to say what are we going to do and what are tariffs going to look like? if it is moderated as opposed to abrupt and quick, companies can absorb that as well. >> or the incentive for the companies to manufacture in the united states. how big of an impact? >> absolutely. deregulation goes along with that as well. a lot of companies have been overburdened. if we see deregulation, you will see more m&a. >> how many are targets if people buy things. >> m&a can be viewed atively with mega deals, but getting to the platform is good for the economy. it is recycling assets and getting them to lower cost platforms and cost the capital.

with all of that, you will begin to see the ipo markets begin to open up. >> does it mean the smaller cap companies are going to compete in the stock market with the midcap and big cap companies at this point? >> we have not seen a lot of flows into the asset class. that typically happens at the moment they should be coming in. a lot of money comes in after the major move. we are very positive on small caps. maybe not the first half immediately as policies are beginning to be determined, but i think longer term. we're in for a very good period of very business friendly environment. i think ipo capital markets are looking a lot better. >> somebody yesterday, i heard them say, midcaps are the new small caps. do you agree with that? >> certainly when you look at the market cap in the russell 2000, the numbers have moved up with inflation and being in equities, you have that movement higher with inflation. i think you want to look a

healthy companies, profitable, good balance sheets, not overlevered. we are in a higher rate environment, it is a higher yield curve. look for good management and good technical moats in services and products. there are a lot of companies out there. >> chris, thanks for coming in today. >> thank you. coming up, when we return, a "squawk box" breakfast meeting. i'm excited. founder of pop-up bagels is joining us. a phenomenon business. and later, exit terview with secretary mayorkas. "squawk box" will be back after this. thanks for swingin' by, carl. no problem. so, what are all of those for? ah, this one lets me adjust the bass. add more guitar. maybe some drums.

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we're excited because, guess what? there's food at the table. bagels. the bagel industry seeing new players in the past few years. one company is working to redefine the timelessness of the classic bagel. adam goldberg at pop-up bagels. this is a crazy phenomenon. >> social media helped during covid. everyone had nothing to do. they were on social media. we started making hot bagels. >> can we talk about the genesis story? >> yeah. >> obviously, there are bagels

all over the world. why did you think you could do bagels better? >> i was making bagels during the pandemic and they were fresh and hot. >> were you making bagels before? >> never. i was protecting downtown manhattan and boston from floods. >> this was a hobby? >> i was bored of sourdough and let's make bagels and feed my friends. >> were you testing recipes? >> i figured out the recipe in three days. >> it took three days? >> three grams of one ingredient. >> zero calories? >> not a lot of calories. they're pretty light. >> you start this and then what happens this. >> i started this in covid. i started making it for friends and getting text messages from people that were pissed off i hadn't made them bagels. i didn't know you.

we met at a party a year ago. give me a bagel. i started to sell them. i didn't want to wake up at 4:00 a.m. and make bagels. i launched pop up bagels to sell out in advance. i knew going into saturday morning if i had to make 50 or 60 dozen bagels, they were sold. i had the money, but i had to produce the product. >> did people who used to get them for free upset? >> no, they get them for free. >> the people you met at the party? >> everybody pays now. >> when downtown id the tiktok instagram start? >> it start anned right ned o right away. the amazing thing with social media, if you start early, you can figure out how to grow

followers. >> what did you do early? for those folks who are entrepreneurs who are starting a business, maybe today, what did you do? >> when you post something, you got to get your friends and everyone to share it and comment on it. that's step one. >> are you texting everybody separately? >> or that sitting in a room and i'm throwing up bagels on instagram and comment. i did a lot of early name that tune. it was user interactive. people try to name the song i'm playing on the guitar to win a dozen bagels. the most important thing is really knowing you can't go from zero to 100. you have to start from zero to 1 to 5 to 10. you have to share your product with other businesses trying to grow. my followers see their product and their followers see my product and little bit at a time, it starts to grow. >> do they have to be complementary products? >> no. i'm buying sneakers today and i love this sneaker company in my

town. they post us bringing them bagels and we would post ourselves buying sneakers. >> what happens if tiktok gets banned? >> it will hurt a lot of people. i'm not actually sure it will get banned. i feel something is going to happen. instagram has been a great vehicle for us. most of our business and growth has been on instagram. if tiktok gets banned, you know, people will survive? >> instagram is the beneficiary? >> yeah. >> how many stores? >> right now, we have ten stores that are open. we're planning on opening 20 to 25 stores this year additionally. >> okay. >> how many employees? >> about 150 employees across the system. >> how big do you think this can get? >> i mean, 60% of americans eat a bagel twice a week. i see us in 100 different markets. >> all owner operated? >> we launched a franchise campaign about six weeks ago.

we've already got 150 locations spoken for in the last six weeks. that's mostly on the east coast. little bit in california. >> had you thought about wanting to do owner operated? >> we do. we started owner operated. >> was there any push/pull on that topic? >> there was. one of our original investors, john davis, big hollywood franchise guy aside from hollywood movies, but behind the biggest franchises, he is all franchise, franchise, franchise. our partners at describe , private equity firm, we decided to go with a hybrid. >> last question for now and we have to get back. this is just the beginning. hope this is -- >> come back for the ipo. >> exactly. they say that new york bagels are better because of new york water. my question to you is if you are going to produce these bagels in

tucson, arizona, in the future, for example. i don't know why tucson. i never found great bagels in tucson. you will not export water from new york. >> it's not the water, it's the quality of the ingredients. >> i can't imagine it's the water. >> there are great bag els in w york and terrible. we made our bagels internationally. we made them all over the u.s. we never had an issue. what comes down to is the quality of the ingredients and love of the product. >> whatever's in it, you can look at what's in the water and reproduce it. >> the water here is salty? >> bagels have been better in new york. now people in l.a. >> there's bagel culture booming everywhere. the reason why people say bagels in new york have always been

better is because this is where bagels started in america. >> sourdough in san francisco. >> started there. nobody thinks of san francisco and sourdough anymore. >> i know i had a question. you do a dipping thing. >> yeah. >> that's the difference. >> we don't make sandwiches. we sell hot and whole bagels out of the oven in bulk. 3, 6, 12. no individuals. no slicing. >> it's just a better model? more output? >> it's bringing back classic, vintage bagel eating. let's get a dozen bagels and bring home. the grip, dip and rip started because people pick them up at the store. >> they are best when they're hot. >> they rip into them. >> can you microwave? >> if the bagel -- our bagel is designed to be eaten fresh within an hour. if not, throw water on it and

the rack for four minutes. >> they are telling us to go. >> we'll eat some bagels. >> good luck. >> i love it. coming up, luxury auto prices jumped in december. il lebeau has those numbers coming up next.

good morning. welcome back to "squawk box." we are live from the nasdaq market site in times square. futures this morning are in the green. in fact, the dow picked up 150 points. nasdaq up 106. yesterday was a down day for all three of the averages. for the week, it has been a good one. luxury auto sales surged in december. that pushed the average price of the new vehicle close to an all-time high. christmas presents, phil? why december? why luxury? >> reporter: they always go up in december. you see a lot of people buy luxury vehicles in december. it will fall off a little bit in january and february. i want to show you this chart, joe. this is from cox ought an owe motive. look at the growth in vehicle

prices. average transaction prices in december because of luxury sales, the average price paid was almost $50,000. that's because of the demand out there. especially for vehicles over $80,000. let me say this again as you look at the dealership stocks. penske auto group. vehicles over $30,000, a 37% increase in sales in december. this shouldn't come as a surprise. we have seen luxury auto sales edging higher. go back to 2020. 1.82 million sold in the u.s. and gradually increased. a record high last year of just over 2 million. joe, this includes your favorite. porsche. they saw sales increase here in the united states even though they fell worldwide, they were up by 1%. you see the 911 model up 20%.

cayenne up 9%. joe, guess what they are coming out with? a 911 with a t-hybrid system. a hybrid porsche. here is the ceo of north america talking about why he believes this will be a hit. >> everyone who had a chance to drive one by now feels this is a no-brainer and a perfect step to electrify a 911. true to the core of the porsche dna. it is about enjoying and performance and offering something consumers want. >> reporter: again, porsche's global sales negative 3% last year largely because of the slowdown in demand for non-chinese brands this china. that includes the luxury brands. the bottom line here in the united states, luxury is hot, red hot when it comes to automobiles.

that's pushing the price of all automobiles higher. >> phil, i don't necessarily think about of a decently equipped or as luxury. that's 80 grand. we have to change your perception of luxury. there are a lot of cars. it is hard to get under it. >> reporter: i understand what you're saying. >> as far as the porsche, here's what i tell you. i have a standard transmission. you can't get them anymore in the newer mod on el models. you can't get an s with a standard transition. 911. i had a lease. i had ten leases, phil. do you know what my car was worth versus the payoff on the lease? it was worth $30,000 more than what the turn-in was. there's no way i could give it

back. i had to buy it. it was immediately worth $40,000 more than what i could turn it in. >> reporter: joe, porsche is a perfect example where there's a limited supply of the porsches that are out there you are lookg specific, you will have to pay up for that model. that's part of the success that they've had. look, anytime you can grow sales in one region when your global sales are under pressure, that says something about the demand and that's what porsche is doing right now. >> i hate those paddles. i hate those things. my year was the -- [ horn honks ] >> my year was the last year you could get an s with the seven st. petersburg. the -- speed. what's the new one called for the standard transmission, but it is only a six speed?

>> reporter: i do not know. i have friends who have porsches. much like you, they talk about the good old days. >> i don't want an air purists 20 years old. he has 12 of them. so you did that for me. fricking hybrid porsche. you did that for me. tell me the -- tell me -- everybody was on my side. tell me the internal combustion engine. >> reporter: everybody was on your side? not the emails i got. >> the people that matter. >> look, it's a fair argument that -- >> those are i.c.e. >> evs haven't taken over. >> reporter: separate from what joe was saying. >> lebeau. >> he was trying to make that point. >> you got pissy.

you know what lebeau rhymes with? renault. lebeau rhymes with renault. that's what you're stuck with. >> your initials are jsk. >> his is ars. >> the british? >> none of us -- what do we think of yours? r -- >> rqq. >> that sounds like an r2d2. >> penelope wanted me to name kyle quinton. qq qqq. when we come back, we take you live to washington for a closer look at the staggering amount of wealth that will be represented by attendees of monday's inauguration. that's next. later, exxonmobil ceo darren woods will join us. "squawk box" will be right back.

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we are just a couple days from the inauguration of president-elect trump and he will be surrounded monday by some of the powerful tech leaders in the nation. some of the most powerful. eamon javers joins us right now. he has more on the story. hi, eamon. >> reporter: becky, this is something we never seen before. the powerful media companies in the world on the platform for the inauguration of the american president. the ceos of apple, amazon, google, meta and tesla and examination will x will appear on the capitol. each company has enormous stakes in decisions that could be made by president trump.

for tim cook, it is about tariffs on chinese goods. trump has called for tariffs on china as high as 60%. apple is ing 95% of iphones and macs in china. jeff bezos with the contracts with the federal government and smaller rocket company blue origin. he sought to mend the relationship between the two visiting the president-elect in mar-a-lago in december and the washington post which bezos owns, declined to make an endorsement in the election. google's sundar pichai with the threat of the breakup looming. the department of justice will make crucial decisions on the case. trump talked about skepticism about breaking up google. it is more personal for mark

zuckerberg. trump repeatedly said he believes the meta ceo should go to prison if he meddles in the election. trump would not have the approval to send him to prison directly, but the doj would have the power to initiate investigations. zuckerberg has the interest in the outcome of the ban of tiktok that compete was facebook and instagram. elon musk has been by the president-elect's side in mar-a-lago day and night since election day. all of his companies are tied up with the federal government in some way with regulation or contracts. he's been floated as a potential buyer for tiktok in any trump brokered deal. all of these executives sitting on the platform behind the inauguration having enormous stakes that the president-elect will have in the coming months. bag back over to you. >> do we have any idea who has the seating chart? who is closest?

>> reporter: it signifies something. we don't have any idea is the short answer. obviously, you know, former presidents, the president's family in the first row behind the swearing in will take place and you get the cabinet members and other dignitaries and people that are invited by the president-elect's family. then the riser goes up into the distance and that's whether re get members of congress and not as important guests. we will watch where these executives sits and if trump seats them shoulder to shoulder or a ceo row on the platform. i think this is a president-elect who is looking at the optics here. he want to see them all on the stage. >> first, second and third most wealthy people on the planet. >> reporter: yup. >> snap and box. you got the two big

ceos. >> eamon, thank you. we will see you monday. looking forward to it. we will remind i where eamon will be there. markets are closed. we have special coverage at 8:00 a.m. eastern time. we have stanley druckenmiller and pfizer ceo albert bourla. make sure to follow squawk pod on your favorite podcast app. we will release a special edition on monday as part of the inauguration coverage. "squawk box" will be right back.

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welcome back to "squawk box." mellody hobson informed the board she would not stand. she feels starbucks is in excellent hands of the ceo brian niccol. the quarterly results are expected january 28th. she had been a hugely part of the starbucks story in the last decade plus. coming up, a closer look at the chip sector. check out the divergence. broadcom is up nearly 30%. amd now down more than 20%. nvidia roughly flat. we'll talk to an analyst next. (traffic noises) (♪♪) the road to opportunity.

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it is just before 7:00 a.m. on east coast. you are watching squawk box. israel prime minister benjamin netanyahu says negotiators have reached a cease-fire deal ending two days of debate. israel security cabinet convened to discuss the deal and if approve it will go to the broader cabinet for a vote which could happen tomorrow. meantime, we will speak to a top biden adviser about that deal in just a few minutes. separately, general motors banned from selling customers driving data from the next five years. settlement deal with the federal trade commission. "new york times" report gm was collecting details about owners driving habits including speeding, hard braking and late

night driving and selling that information to insurance companies and data brokers. they used the data to deny policies or raise rates. >> what? >> yes, yes. it was. >> gm i remember we talked about this. >> we have. >> and we bring up the jim carrey movie. the cop pulls him over you know what you did wrong? >> depends on hog you been following me. >> gm is following you all the time. frightening. >> tiktok fortunes taking a positive turn to several u.s. official say the app's chinese owner could have more time to set u.s. operation and stopping it from being ban on sunday. president-elect trump encoming national security adviser says the new administration will kyiv it alive if there's viable deal. supreme court is deciding whether to uphold the ban may issue the ruling today. we have a lot more on that throughout the next two hours. >> fascinating story. let's check on futures. we have been in the green all

morning long. dow futures rund kateed up by 122, nasdaq up by 70. s&pp by 16. we have lock at premarket movers and what is on the move today. >> good morning. we will kick things off with check on the airline stocks because american airlines is flying high after a bank of america analyst upgrade to a neutral rating a raining target price up to 20 bucks from $12. they said the airline should benefit from premium revenues, rebound and corporate travel and growth in atlantic routes, trends delta discussed this past week. b of a doesn't see the same outlook for southwest a jetblue both stocks lower downgraded to under performed from neutral and analysts citing less exposure to corporate travel and premium travel and international routes. so if you are keep an eye pop robin hood is up by 3% or so 2.5% after morgan stanley named it a top pick saying the

company has a sustainable business model with analysts highlighting robinhood participating more aggressively in crypto currency trading. morgan stanley said into the fourth quarter brokers focus is on cash sweet balances and asset trends. shares up 2.5% about for more on that other key calls head over to cnbc.com/pro and subscribers get detail and a sis there. and we will wend check on apple. that's coming off the worst day since august up about maybe half a percent or so. down 4% after a umber of disappointing reports about slowing iphone sales in china. the it can giant is the worst performing stock in the so- called magnificent 7 so far this year. and by the way, becky to give you perspective, the drop yesterday led to 144 billion in market cap loss losing an entire uber in one day of trading. back over to you. >> wow.

yeah, guess they can afford to lose it, though, but that's pretty hefty. >> it is pretty hefty for sure. >> dom. >> what? >> how big what did you say 134? >> 144 just thereabouts. >> i am not going to mention any other companies that are below that. thought i would. enviedia shares rebound after declines earlier in the week. >> thank you. >> joining us to talk chips wolf research senior analyst what's a layman to do trying to -- you know, but it is -- it's so difficult to analyze all these things. let's start with tsmc. those are great numbers. these are not necessarily for a.i. chips. they are for older type chips but great results. >> well, tsmc produces for everyone. they are the producer of record for the industry right now. but what's interesting in the

results, and their guiding revenue up 25% next year 60% of that growth is coming from a.i. and after the a.i. revenue tripling in '24 they expect double digit this year which is good summary of what's going on in chips which is a.i. is just driving the bus this that's where the growth is. and everything is middling right now. and it's been really interesting because we are sort of in the third year and outside of a.i., so in a bit of a downturn in the semiconductor industry given the inventory built up during the pandemic. and by now, you would think that the rest of the business, pc, handsets, traditional servers other stuff would be stronger. but it's not. and we lowered numbers on a couple companies, you know, going into earnings last -- earlier this week. and it's been really interesting that everything outside of a.i. is just kind of okay.

and a.i. is driving everything. >> i guess i was also thinking about that the latest salvo in the, you know, back and forth between china and the united states involves these mature node chip makers that we are subsidizing. is the u.s. subsidizing or are they looking for things given that, you know, we are they retaliating against the things we are talking about with china? >> yeah, think that's some retaliation. you know, china is trying to find ways to retaliate where they can. and the u.s. export controls on china have been effective. that, you know, china cannot access leading edge manufacturing technology. they can't access leading edge a.i. technology, nvidia chips and you know top end nvidia chips are not accessible in china and they are trying to strike back

where they can. >> the comments from wong he was excite about quantum and then he kind of revised that that it is 20 years away or 15 to 30 years away for actual application. so a.i. is closer still in the maybe somewhat pay off is in the future. but 15 to 30 years for quantum? we got excited about that this week, chris. >> yeah, it is you know it's promising technology. it's just not ready for mass market right now. nvidia is holding an event with quantum companies coming up. and you know, i think jensen has his reputation very well earned of being cooped of on the forefront of this stuff. and, you know, i think he wants to be involved, but the other side of that is you know, in the near term, even kind of two, five years and that, what jensen is doing with accelerators in a.i. and really it goes even broader

than that, as a result of the slowing of cpu don't drive the same performance as they did, that's the story in semis right now. >> okay. i said, it is -- so what your favorite stocks right now, chris? >> yeah, we like nvidia. and you know, some of the concern the reason why the stock has kind of flat nd out here is some concerns about the new products cycle blackwell how quickly it ramps, you know, based on what we saw in the supply chain. we are keeping expectations kind of in check for the first half of the year as they do that transition. we expect a really good second half of the year as more capacity comes in play. and our favorite name is actually mikeron the millionry producer which is an exposure to a.i. because there's a certain flavor of memory hbm into a.i. micron just getting into the market and the reason micron

stock is because the cyclical spot exposed to handsets and pc and have been burning enven to every. as the cyclical part eases and you start to get good news from a.i. coming into the numbers. and -- >> all right. i don't know. the music. it means something. >> they are playing us out, chris. >> they are playing us out. >> your voice the tones of your voice is beautiful with that background. but, i think they are doing that for to tell us to go but thanks. >> i understand. >> have a great weekend. thank you. sorry. still to come the man who led the negotiations for the cease-fire between israel and hezbollah joins us to talk middle east tensions and the latest on the israel-hamas cease-fire deal amos hochstein will join us when we come right back.

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get the 5-year price lock guarantee, now back for a limited time. powering five years of savings. powering possibilities™. markets wrapping up a big week of inflation data and futures are looking back dow up 40 points and s&p 20 and nasdaq up by 8. and it's been good week for all three of the major indexes we want to bring in head of envestment strady and equities at bny wealth. this was what we thought was going to be a volatile woke, a lot of important numbers came in. besaw the s&p dip down by 5% from the all time high, but if you blinked you missed it because the markets took back off on these cooler than

expected inflation numbers that came through. where do you see this kind -- what's trajectory does it put us on. >> i think we are going to get more of the same. we think it's going to be a mush more volitive year this year really circled around policy and fears of inflation and fears of treasury supply. so, the bond market and risk on the bond side is going to be driving volatility and equity market. but having said that, fundamentals are so stopping, and corporate, you know, credit spreads are still tight. fundamentals are good. we are looking for double digits earns this year. we think the market ends higher i but it's not going to be a year of 56, you know, new highs that we had last year where it was a steady walk upward. so more volatile, but fundamental stills strong. and coming into the year with, you know, the s&p at a 22 times forward multiple, you just there's no room for error here. so you will get more volatility regardless what happens in washington. you're looking more vulnerable

to it. >> is the stuff that's happening in washington noise in terms of any potential spooking it does of the market? because if you look at earnings, they have been pretty strong, too. so, what do you follow? you can worry about the fed kind of saying it's not going to cut-rates anymore. the worry about potential for hiking rates with tariffs or beyond. but there's pretty strong positive things out of washington and you have earnings backing that up, seems that would win the day in we focus on fundamentals because they are their are headlines for anything and essentially, the s&p is just reflection of the strength of american companies. and we are there, you know. we are in a world where it looks like the labor market is reaccelerating and looks like, you know, consumer spending continues to just tick upward on the trend line regardless of the fact of higher rates, higher for longer, toe just in a world where you have earnings

and corporate credit type and incorporates with double digit earnings and consumers spending, it's a world where you can get around some of the policy issues because ultimately, it's the fundamentals are fine for the market. that's where we are. that doesn't moon it's going to be a peaceful year here. there's going to be volatility here. in an average year, the average draw down is 12%. even in years where you have double digit gains. we haven't had that in the last couple years last year it was 8% in a week. and if you missed it, you know, you. >> you blanked you missed it it may happen this week. >> what investors is learned by the dip and we had a 5% dip and that was pretty good. and the other thing, let's talk about where the market fear is, the market fear is all on one side. so, you have tight positioning on inflation for longer. the fed can't cut, you know policies are going to be very difficult. and so, it doesn't take much to get the trade to go in the other direction.

think that's what we saw this week with cpi. >> what, if you are looking at fundamentals, what do you like? >> so, in terms of sectors we like industrials here. we think policies that will be coming in of deregulation more m and a and favoring reshoring- industrials. tech led this week. i think it's a reset on valuation. i think tech still is fine this career. particularly communication services so we like that here as well. so we just think it's an about better year and better entry point. and i think there's just more of this focus on the points you know. cpi, inauguration day, 100 he can beingtive orders. there's fear of these things driving the fear of actually jumping in. once you get past that we will resume the upper trend. >> what do you not like staples are still in difficult place. right. i think health care is really interesting here. it can't get off the mat.

and if you -- it looks very difficult. that's going to be a show me situation. i think very difficult to invest there. staples are difficult. we are not in a market and we are not in a economy where those sectors can do well right now. we much prefer the cyclicals as we spoke. and that's where we would go. avoid the other sectors. we are exposed to u.s. large cap. we are neutral weight. medium mid cap and small cap as well because this is a kind of policy environment deregulation where those sectors can be pretty -- do pretty well. >> thanks a lot. >> thank you. up next, social media and the supreme court. the nation's highest court set to rule on whether the popular app tiktok will be banned. and then later, quantum computing. so now we are told it's going

to be gradual from jensen wong for the next 15 to 30 years and why call it quantum? it's supposed to be gradual. what exactly is a quantum computer. we need a new name. what can it do. we will go behind the scenes in silicone valley. squawk box will be back. which three nfl quarterbacks have rushed for more than 1,000 yards in a season. the answer when squawk box returns. agh! cut! this gap! it's just too big. bring on the double! aflac! after my hospital stay, aflac helped close the gap by paying me cash for expenses health insurance didn't cover. nothing covers gaps better than the aflac duck. aflaaaaac! aflac. get help with expenses health insurance doesn't cover. find an agent, get a quote at aflac.com. you do look like me. mhmm! only the servicenow platform connects every corner of your business, putting ai agents to work for people.

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is. now the answer to today's aflac trivia question. which three nfl quarterbacks have rushed for more than a thousand yards in season. the answer michael vick, lamar jackson, and justin fields. the supreme court could be ruling today on whether to uphold a strike down or delay the law that would ban popular chinese social media app tiktok in the u.s. meanwhile president- elect trump who takes office the day after the ban says we delay a ban so here's the question this morning, folks, should the government shut down

tiktok this weekend? and guess who's here jon fortt to weigh in on both sides of the matter. what do you think. >> well, there's no need to shut down tiktok this weekend. this process was never about eliminating tiktok as a product. so much as it was about making sure u.s. citizens valuable data doesn't end up in the hands of the chinese communist party. tiktok really burst on to the scene seven years ago during the first trump administration. quickly gained influence thanks to music features that launched celebrities and it's popularity grew in part of mysterious artificial intelligence algorithm that keeps users continually engaged. tiktok could be worth as much as $200 billion with more than a billion activeers. oxford economics report last year estimated small medium business drove $15 billion in 2023 revenue in the u.s. so pulling the plug on tiktok

abruptly would disrupt the ability of those businesses to connect with their customers. now while they eventually find them on instagram or twitter x it would take time. with a new trump administration coming into power next week, there's no need to be half they. you have time andrew. >> okay. but, it's been a long time fair enough to say since the tiktok sale pressure started it's not like time is the issue. >> well,. >> on the other hand the government should shut down tiktok immediately. congress passed it the president signed it. they want to be the tough parent i am going to count to three and if you haven't picked an american buyer. so, it was back in august 2020 that the tiktok ban movement picked up steam. then president trump gave his its parent company 45 days to sell to an acceptable buyer a week later he gave them more time even though he said it posed national security concerns. then the biden administration

came in and pulled back from the blanket ban. and congress over the past few months passed a law that i bans tiktok biden signed it. the same president trump who tried to force a tiktok sale with an executive order is trying to stave off a ban to give them more time to find a buyer? come on. bluffing doesn't work if you are obviously bluffing and right now it looks like the u.s. politicians are more afraid of the popular lar and economic backlash of a shut down than china's influence over the app and dealer. >> can we just -- i wan to forget about both sides of this. for a second. >> yeah. >> i want you to weigh in on what i think is the actual issue. the fundamental question which i have been raising for the last year and a half, is whether you fundamentally believe that tiktok is a national security threat not perexpectively. we can debate that. everything perexpectively potentially could be a threat i mean meaning in the future,

could the chinese government do something with this? yes they could. and by the way, if on that basis we want to get rid of it, we should. but that's not the basis with which we have made this decision. at least my understanding. if you the most of the folks in the senate and congress who voted on this bill, believe and have been convinced or i am not sure what really happened, that somehow genuinely things are taking place s we speak. >> okay. >> between the chinese government and tiktok executives, and there is actually bad stuff happening route now. that's what we have been told a million times. the american public has been told this and i am not sure that's true. >> i have no way of knowing that, but i would refrain this in this way. it's like saying, is china right now preparing to take over taiwan in 2025?

>> yes. >> or,. >> and i vote yes. >> well, in the next year. specifically. >> next year. >> in the next year. >>i don't know about this. >> do china's designs on taiwan pose a national security threat. >> long-term. >> in general. and. >> sure. >> as the u.s. do you have to put policies even laws in place. >> if that's true. >> because of the prospective. >> if that's true and actually true, then the question is, how do you do it and do you have to do it now and then why are we so happy to leave the thing going? if it is a national security threat, why is the ceo who i as you know don't think is an app security threat is sitting next to the president of the united states. >> i was reading about how a so the spy was allowed to stay close to the queen of england relatively for a period of time. sometimes, you do these things, i suppose i don't know, i am not the cloak-and-dagger expert.

but none of this makes perfect sense to me. and probably none of this makes perfect sense. >> and do you have any view there's a xenophobia or some kind of political. >> always. >> you know. there became a very popular. >> yeah. >> in the last year or two. for china to become this boogieman i am not suggesting there's not major real threats from china. emnot the connection with russia and iran and all of those things. but i just with this particular thing i wonder whether we have been fully told the story. >> well if we have full yes been told the story, it would be the first time, right? anything serious we fully have been told. >> interestingly the supreme court even in what they put out so far, has suggested that the bill itself is based on a supposition that has not actually been proven. being look at the language. >> yeah. >> what do you make of that? >> i don't know. i got to give you an i don't

know. >> i don't know. >> well. >> on all the hands. >> but, you can help figure it out for yourself. there's on the other hand newsletter scan qr code on the screen, give you time to do that or type in you don't. >> he time cnbc.com/oth get the text of the arguments-ponder it on your own. >> thank you, jon. >> thank you. when we come back, one of president biden's top advisers on energy and the middle east amos hochstein will join us to talk about the cease-fire deal between israel and hamas. "squawk box" will be right back.

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welcome back to "squawk box." the futures on this try morning have been higher throughout the course of the day. we are looking at the dow futures up by 160 points. that's about the highest we have seen over the last hour and half. nasdaq futures up 100 points and s&p 21 and few programming notes. markets are closed on monday for the martin luther king jr. holiday, but cnbc will host a

special presentation of the inauguration of donald j trump as 47th president. we will have coverage of all the events live from washington, d.c. starting at 8:00 a.m. eastern time. obviously, it's a big shift in the administration that is going to be coming in in terms of how it deals with business and as a result, you will see a the love business leaders who are there. we will have guest appearances from pfizer ceo and walter isaacsen and walmart ceo doug mcmillon and we will have special reports from the ground on the issues that matter most to your money. also next week, the world economic forum kicks off in davos. our coverage begins on tuesday and our guests from the slopes includes the ceos of the nasdaq, uber, coca cola, microsoft, cisco, salesforce and many, many more. it's going to be big week on "squawk box" and cnbc. te in for all of it. "squawk box" will be right

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from our team of mobility experts. because we believe the more ways we all have to move forward. the further we'll all go. he is rally prime mister benjamin netanyahu said negotiators reached a cease- fire deal ending two days of

debate. it could take effect as early as sunday if i have approved joining sus senior adviser for president biden for energy investment. good to see you, amos. >> good to see you too. good to be on the show. >> i am going to have to find out where you are headed because this might be one of your final interviews. only great things we all see for you, obviously, in the future. but, while everyone is trying to take credit for this, and you have seen sort of the back and forth, and obviously the two teams worked very closely together both teams said that. which is gratifying, think there are some people maybe i don't know if you saw a piece in the journal from the news paper writer in israel. that said that actually president trump forced the prime minister to make a deal that allows hamas to maybe not

only survive but maybe even rebuild and it maybe should have been pushed back to after the inauguration. >> well, first, thank you for having me. it is my last interview. so i appreciate all the time with you over the last four years. look, i think any with all respect to the wall street journal, no one forces prime minister netanyahu to do anything. he's been around for a long time because he manages his politics fairly well and knows what he believes is the best thing for israel. at the end of the day, we have to focus on is not credit and not anything else. it's two things, number one, hostages the first three hostages are coming home on sunday. after being in captivity for over 470 days. this is a horrific and the fact they are coming home, i think is the only thing we should be focusing on. the second things think something extraordinary happened here where an outgoing

president working together with the incoming team and steve going to join the negotiator who had been there for many days and together, seamlessly working to achieve the goal of ending suffering in gaza and bringing home all the hostages 33 of them in phase one. he think that's most incredible here. >> was the notion of destroying hamas once and for all, was that ever feasible do you think? that's the point this gentleman makes. under the agreement, hamas will be able to replenish the depleted ranks, 700 or more will go state from prisons to the streets of gaza. and it's a mistake that israel made in the past that sometimes comes back to haunt israel. and additionally, you know, goods, things can flow back in

gaza. could it have been, if you waited until after the inauguration, would israel have been more free to completely crush hamas once and for all, amos? was that ever a possibility. >> no. >> not feasible. >> first of all, i don't think it would have made -- you are talking about doing it next week or this week. it doesn't make any difference. the trump team was here as part of the negotiation and reach the same conclusion we did, that this was the right time to do it. and, look, israel at some . in every conflict like this, on the battlefield, you have to turn the battlefield gains and israel has enormous battlefield gains, into political gains. and the point of the war at the end of the day is to bring the hostages home and to have security arrangements that israel needs. israel believes it does have that, israeli military believes that. and i think that that's what you have to focus on is what's the right moment to be able to do that. there's always at any time you

end a war, except for a world war ii like ending, you always have to make that decision. remember, november 27, 50 days or so ago, we signed the -- we announced cease-fire between israel and lebanon and people thought it would hold for ten days because hezbollah would rearm and it is cease-fire is holding and that gave us the ability to do this deal. hamas realized hezbollah is no longer in the fight and israel has a one front war and not two and the first time in a long time they came back to the negotiating table. so, it's in the same issue there, translating military gains into political gains that's what happens at the end of conflicts. >> it's food and goods and fuel and we have -- you know, obviously, the humanitarian

plight of people in gaza has been very difficult to watch, but we know what happens to a lot of the goods and fuel that go into gaza. we know how ruthless hamas can be in terms of, you know, not really caring whether it gets to the people that need it or not. that's going to resume as well. anything that can be done that to make sure that doesn't continue to happen and just strengthen and allow hamas to regenerate itself? >> look, no one -- let me be very clear, no one, not in israel or the united states, no one wants to see hamas reestablishing itself. and that's why this agreement is about letting those bring hostages home, ending the conflict for now for the 42 days, and using the time to negotiate the phase two of the deal. while working with allies to have -- to establish a new security and civilian

administration in gaza that's not hamas. we recognize you can't have a vacuum that hamas starts its new 20-year build up of weapons. israel is not going anywhere palestinians are not going anywhere. so, we have to have something that could work, and continued war is not the answer. it certainly not the answer for the hostages and their families who are coming home. we recognize the risk and i think the trump team will come in and continue the process to try to figure out a political horizon that ensures israel's security and gives palestinians in gaza a new hope to be able to live upped a leadership that works. look, the middle east today, joe, is dramatically different than what it was a few months ago. iran is weaker than it has been since the fall of saddam hussein. hezbollah dough grated significantly, assad is gone and there's an opportunity in

syria. hamas militarily defeated. israel is recognized by both the friends and foes alike as strongest military. no one is counting the power of the united states. so i think these are moments of opportunity. >> let me ask you. someone in the middle of the negotiations, we had dan at the table yesterday, and one of the things he said was he believed that president biden's rhetoric around his support for palestinians and his support for a cease-fires and gaza throughout, putties rail in a box. during the negotiations. not just in the negotiations but in terms of some of the things they ultimately did which by the way today make them as strong as they are and put potentially in the position to actually put this deal on a table in a way they were unwilling to before. do you you believe any of the rhetoric that came from your boss made it more complicated, made it more difficult? >> look, we have been in a

since october 7th, we have been supporting israel's right to defend itself from the first day when the president traveled there a few days after october 7th to the last day. we had some differences of opinion on tactics from time to time, but the overall goal of destroying hamas' military capability has been something that the president has been committed to. yes, we had some things we saw we didn't see eye to eye on, we had disagreements, but that was all intact cal not strategic. strategic was goal remained always to defeat hamas terrorist network and military capabilities and that's achieved. instead of focusing one incident here and there, if you broaden the aperture and look at the amount of weaponry and support israel receive from the united states, it s enormous. now, the presidentfeld felt strongly civilians in gaza and innocent people in gaza cannot star of to death in this

conflict and there are rules and norms the international community puts in place for this reason. and so, this is the conversation we had about bringing humanitarian trucks in and some were stolen and looted, and you have to adjust. but i don't buy dan's argument. and at the end of the day, the cease-fire that is today on the table that vast majority of israelis support was put on the table by president biden in the summer. and we worked with israel and hamas refused over the summer to come to a deal. after the hezbollah negotiations were concluded, they decided to come back to the table and now you have this is not team biden this is now the same cease-fire that president biden put on the table has now been agreed to by the parties, and at the encouragement and mediation of both our team led by bret and

jake sullivan and others, together with steve whitcoff for incoming president. not everybody was ready for a cease-fire at time we hoped. but i think this is a day we should be at least relieved that hostages can come home and civilians on both sides innocent civilians can be spared the death sentence they have been facing. >> amos, as you mentioned, the trump administration advising and being involved with the negotiations too, you expect that this situation won't change once there's a new administration that's in place? you think the same policy will be held out and that we will see the rest of the hostages come home in two more tranches? >> yeah, that's -- look, that's my hope and that's why it's important to invite the trump team to join the negotiations. they know the details. we are going to see the first trainch 33 coming over a period of 42 days.

so it's a painful drip, drip of coming of hostages coming out. but i think the idea is that on, think day 14 or 16, you begin negotiations over the phase 2 for the rest of the hostages so you don't have to go back to fighting. and that during that time you find a political solution that allows for a security force to come in that's not hamas, to secure the area. and that you have a political leadership that does civil administration in gaza neither israel or hamas. >> amos, good to have you n and get to talk about a lot of testimony yesterday about the energy needs of the country. i thought interesting back and forth that we saw yesterday. you were probably interesting or at least watching to some extent. it can always be better but we are doing pretty well with oil production. i which we had the spr are we going to talk about the things

anymore? you going to come on. >> i hope so. i will talk any time. you refilled it 60 million barrels and which is not what the expectation was. we are leaving with 13.3, 13.4 million a day production. >> i opened the door for you. i gave you the chance to do that. take the victory lap. you are welcome. you did. amos, thanks and don't be a stranger. we will see you. >> thank you. >> all right, take care. >> you might be like ceo of exxon next he is today. >> put in a good word for you. >> exactly. >> coming up rich genrefield on the possible tiktok ban. we will discuss it after this. rich greenfield is here. "squawk box" is coming right back.

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welcome back. tiktok facing a deadline but that could change. biden administration official say they don't intend to enforce the ban fore leaving

office on monday of course. and instead, allowing the incoming trump administration to handle it. joining us rich greenfield. cofounder of that firm good morning to you. >> good morning. >> i am not -- i am not going to put words in your mouth. your betting line is what happens? >> well, look, i still continue to believe there's a chance supreme court comes back and puts administrative stay or puts injunction in. but let's just say supreme court upholds the law, that's the betting logic for those who listened last week. let's say the supreme court upholds the law and it goes into effect sunday. i still can't comprehend why the biden administration can kick the road down 90 days and make it a trump deal. i doesn't know why they want the law to go into effect on the last day in office. it is another way for the democratic party to continue to blow up their relationship with, you know, people all around the united states. so, that doesn't seem like a great democratic strategy.

but, it is all irrelevant. whatever the supreme court says and biden does, all of it is irrelevant because trump laid out the path for exactly how he is going to side step this law come. >> explain it. what do you think he's going to do? >> trump filed a brief in late december, andrew, and that brief, with the supreme court. his incoming solicitor general filed a brief and what it basically says is it cites article 2 defying what the president is allowed to do. and in 1937, there was supreme court case called the curtis wright case and what it basically said is international or foreign affairs the president's powers are supersede congress. he has powers that go beyond congressional grant of authority. he is the sole voice speaking for the nation in foreign affairs. and he actually uses those words in his brief. and so, it really delineates the powers he has domestically governed by the constitution

and congress and on international affairs, it goes beyond the constitution. and so, trump is going to say, this is a foreign affairs. this is china and this is my overall negotiation with china, this is not something congress has the right to do. >> so, but. >> executive order saying this doesn't apply. >> >> let's put it out there straightforward worked i think you think ultimately tiktok not only survives in the united states, but survives in the united states under the control of bytedance under the control of china? >> i believe nothing is going to change, correct. and i believe trump is likely to trade something for that actually happening. i mean, look, being on sunday at trump's rally head of ceo of tiktok is showing up. and it's clear trump likes

tiktok, trump wants tiktok to exist. he uses it very aggressively. we can debate whether that's good or bad. i think it's interesting that of all the social media companies the only one that had algorithm monitored and data monitored ever yes day where monitor every day was oracle. >> if that's the case and it goes to the point i was trying to make but maybe people disagree with me. if that's the case, do we actually believe that tiktok is genuinely a national security threat today, prospectively or otherwise. >> look, it's hard to look at historically, it being a national security risk if you look at the government's own filings, and this was brought up, i think by just gorsche

there's been no evidence. the u.s. government has no evidence at all that there's been any manipulation of an algorithm or spying on u.s. citizens to date by china. so that's factually. >> correct. >> nothing has happened. >> why not settle out. you and i maybe the only people who are saying this. >> look, it's in the case. like it's literally on -- you can. >> it's in paper black and white. you want to read it, read it. i can't tell you how many other people come on the broadcast and say all sorts of other things. >> over -- you know, the covert documents or things that have only been shared. we know nothing has happened to date. now, is there debate of whether things have or haven't happened overseas? i think if you real the arguments or listen to the oral arguments there's a discussion at one point about the government attacking tiktok for what they have done in hong kong. i was just in hong kong, andrew, tiktok to being doesn't exist in hong kong. i doesn't know what the

government is talking about. leave this aside, the reality is is there a threat long-term of spying and data leakage. sure. i don't think anyone can dismit there's the impact. >> 100%. >> is that enough a national security risk? that's obviously something that, you know, i guess ultimately the president has to decide not congress. and i think that's what you will see is trump is going to make the decision on whether that enough of a risk to force maybe a change in the monitoring and more stringent monitoring, maybe a partial owner from the u.s. i don't know. i just think next week, all of your viewers who are watching right now and worried. >> will still be on tiktok. >> yes. >> we have to run. have you downloaded the new app everybody is doing red note? >> i have not down loaded that red book. >> that scarce me. that's servers in china not servers in texas monitored by

oracle. >> if you watched landman yet. >> i haven't what do you think, joe. >> i love it. i love it. >> i am finning black doves as we speak right now. >> what's that led zepplin. >> i don't know who made it it is british on netfli h wait, the one with -- >> i started watching that was too weird. >> you did so you are lying.

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it is 8:00 a.m. on the east coast. you're watching "squawk box" right here on cnbc. i'm becky quick along with andrew ross. s&p futures up by 23. the nasdaq up by 112. treasury yields have come down. you're now looking at the ten-year at 4.57. the two-year appear 4:52. cryptocurrencies are up. bitcoin up to 102,879. shares of apple this morning, it had its worst day since august 6th yesterday, following news the company was dethroned last year at china's biggest smartphone seller.

the stock is up about three-quarters of a percentage point. the last year, up by 25%. the eye-popping rally and crash in quantum computing stocks has brought this into mainstream talks. we have a look at what exactly is quantum computing is where it's all headed. good morning. >> andrew, good morning. we went behind the scenes with one of these quantum companies this week, a venture-backed startup in silicon valley. it's looking to compete against google, ibm, amazon, and it's creating these high-powered computers. the founders say can revolutionize industries from health care to aerospace. the hype around quantum computing has to do with its potential. these computers can potentially solve problems that right now are not possible. with classic computers. it all hinges on quantum physics. hence, the name. the normal computers out there

use bits to process information. it's either a zero or a one, but a quantum computer, uses quantum bits or qbits. they can be one, zero or in super position at the same time. this makes it possible to solve multiple pathways or problems at once, which is especially groundbreaking for complex math. google had a major breakthrough in the fall that sparked some mania, and nvidia's jensen huang said the potential is 30 years off. >> i think it's reasonable to be skeptical about quantum computing as a field. it's very new. there's a lot of hype and it can be difficult to make sense of and i very much welcome jen's comments. i think they were appropriate. obviously, we have an ambition to be an outlier relative to that prediction.

>> the founder thinks the timeline is more within the decade but he called it a frothy space. he said there's a lot of hype and pessimism. the challenge for every quantum company is scale. the consensus is in order to have a working version, it will take one million qbits. the most advanced quantum giants are closer to 100, so still quite the gap there. >> kate, thank you. a lot of people talking about that, robotics. what are the other biggies? we'll see. we'll see -- >> drones. >> five years away, ten years away. >> i feel like this year was supposed to be the quantum year, the robotics year. >> you didn't get my reference earlier? >> which reference? clearly, no, i didn't get the reference. >> i don't think you were listening. kate, if quantum is going to happen gradually over the next 15 to 30 years, we need a new name.

quantum is supposed to be -- >> quantum leap suggests -- >> that makes no sense. quantum, it's supposed to happen immediately, so change the name, right? >> quantum leaps? >> no, it's not. in physics -- instead of something gradual -- do you know how atoms work? quantum, energy levels. >> one of the interesting things, when you look at these computers speaking of the quantum bits, they have to operate at such cold temperatures in order to make all of the physics behind it. it's interesting to go look at these things. they use liquid helium. it's quite the operation as you saw from the video. >> how cold does that have to be, i wonder? >> as cold as deep space. >> really? >> colder than normal space. >> liquid helium, yeah. it's just -- i don't know. it's not really a serious comment. i'm just f'ing around as i do from time to time. let's get to the broader

markets. senior portfolio manager at dynamic funds is within the great state of canada. you probably want it to happen, don't you? you're ready, aren't you? but you need a new governor. that guy's toast. >> i knew that was your opener. i knew it. i didn't even have -- i knew that was your opener. >> you know why? because i know you're like the guy in greenland, you're ready to do it. everybody says no one wants to do it, but you're ready, aren't you? >> is greenland cold enough for the quantum data centers? >> that's a good question. are you bullish for 2025? >> i am bullish. >> why? why aren't you worried about inflation or tariffs or multiples or any of the things that we're worried about? >> first of all, i think the new administration has historically been a pro-growth

administration. the person put in place and the president is a pro growth economic president. i think tax cuts, regulation cuts are important. i think you've heard from several of the large bank earnings conference calls a sense of optimism amongst krooez in the united states in terms of investing now in the country. i think that's going to go far in terms of continuing to drive growth. having said that, i think there's a nuance, obviously. the s&p has dominated by a handful of companies that have higher valuations. the s&p on 12-month forward earn sgz trading around 20 times. the midcap or smaller cap and look out over the next couple of years they're trading below 15 times. i think many of the policies that are likely to be enacted by this administration are really going to help small, midsize businesses and the people that sell to those businesses. i'm quite optimistic. i think, perhaps, the game is changing in terms of where those opportunities are. but i do think there are

substantial opportunities and it's a good time to be bullish, for sure. >> people lately have soured a little on small caps. that gives you an opportunity to buy, you think? if rates don't come down as much as people thought, the whole thesis gets thrown off, doesn't it? you can see we're showing the russell. >> yeah, i mean, i look at the s&p idcap on the next 24 months probably trading around 13 times. midcaps around 14 times. large caps around 20. so, i'm not saying -- you have to be selective. you're not buying 400, 600 stocks. those seem to be fertile fields searching for ideas, obviously, where the growth rates are now almost equivalent to where the larger -- the mega caps are trading and valuations are significantly lower. so, i also think on a regulatory side that, you know, regulation and other things have been a burden on some of these smaller businesses without global

operations. interest rates are clearly a risk. it's what i think is one of the biggest risks to the overall markets in 2025. that has more to do with policy choices made by the central bank and less so about where i think inflation is going. rates are meaningfully tight here. everything is really coming in. the last two numbers we have are very positive for getting to the 2%, 2.5% fed inflation goal. i do worry about mistakes with central banks and keeping rates way too high for too long. i'm definitely dovish on inflation cap like -- like waller and others are. >> what about tariffs? once again, you are in a part of the world that could be impacted by that. >> well, tariffs as it applies to the u.s. market, you know, every central banker where you have a national sales tax and that tax is increased by 1%

every single year looks through that to longer term inflation. i'm not sure why this federal reserve is referring to that. when you talk about the 50 basis point cut in september, what they talked about is rates being meaningfully tight. they talked a lot about many of the things that were sticky in inflation, being nonmarket numbers. the difference between owners equivalent rent and zillow is enormous in the market. you shift that to after the election and all of a sudden we're worried about sticky inflation again when previously it was nonmarket rents. my concern is the fed reacts -- this sort of happened in 2018. inflation was quite subdued. there was concerns about tariffs and what the inflationary impact would be growth from tax cuts. you know, they raised four times in 2018, caused a market crash in the fourth quarter of '18 and has to quickly reverse and start cutting rates in '19.

i'm less worried about the inflationary impact of tariffs are, which i'm pretty confident will be minimal. i'm a little bit more concerned to the reaction from central bankers. real rates are very high right now. >> i just think you can't really say you'd like to be part of this -- your countrymen would be mad. i think you've -- what would happen, though, where would people move when trump was elected if they can't move to canada if it wasn't part -- you know what i'm saying? that takes that off the table. . that won't work anymore shlgts right? >> i as much as you appreciate the president's humor. i'm not a comedian or a comedy act. >> you're kidding. >> no, i'm not. but i did stay at a holiday inn express last night. i think the reason that hits so hard is because it's been a tough time in the community and

economy prior -- >> even with all of our help, all the subsidies. >> and canadian -- there's no providence in that's above the poorest state in the united states. there's a tremendous sense of economic frustration in canada. i think most canadians are focused on the next election and where we go from there. but, you know, i think the president's a good negotiator and we'll see what he gets from the united states. >> we're going -- we'll give you minnesota for the northwest territories, if -- does that sound fair? >> are you putting data centers in the northwest territory? i think you can strike that without giving up minnesota. >> all right. we have breaking news apparently. we'll see. noah, thanks. good to have you on. thank you. o, canada. >> we have breaking pharmaceutical news. bertha joins us. >> the biden administration putting out the next 15 drugs

for medicare drug negotiation on their last day here. here are the 15 names. ozempic, which was widely expected to be on the list, of course, to treat type 2 diabetes, max oe smith kline's trelegy for opd, ofev for pulmonary fibrosis, linzess for irritable bowel, calquence for diabetes, a breps which treats calqence from as stra again ka, tradjena,

vraylar, t and breo by glaxosmithkline which is for treating asthma. the cms director says these 15 drugs account for $41 billion in annual medicare spending. when you look at it in terms of part d spending is about one-third of part d drugs. these are the drugs dispensed at the pharmacy. ozempic was widely expected to top the list. cms spending on that glp-1 surged more than 200% to just over $4.6 billion two years after the fda expanded these for cardiovascular risks. the number of medicare beneficiaries on that drug also soared to about $780,000 by 2022. they approved wegovy, some those it might be on the list because it's the same molecule, but it's

not. for notice nor voe -- outgoing secretary says taking the ten from last year and 15 chosen this year account for one-third of all part d medicare spending. if the trump administration holds to the schedule laid out in it the inflation reduction act, by 2029 medicare could have 60 drugs with these negotiated prices. at this point there are nine lawsuits pending over this. so far none of them has managed to get an injunction in the courts. >> huge question, again, is what the trump administration will do with this, what they'll do with the ira, inflationary reduction act, and what hhs would choose to enforce. >> the interesting thing is,

this is part of the law, but also in a sense, it took up what trump had already proposed in his first administration. he had talked about essentially doing reference pricing to the prices that some of these drugs are negotiated in other countries. so, if this new administration takes up that tack, not to mention this wprovide some savings. if you look at the $41 billion from these 15 drugs named today, they usually get somewhere in the range of a 22% net discount. that's what they got last year. so that would save them $8 billion just on these drugs. >> we will see. bertha, thank you. it's good to see you. up next, we have a can't miss interview with exxonmobil interview darren woods on his company's battle with california over the issue of plastic recycling and what california

has been saying about exxonmobil. stay tuned. you're watching "squawk box" and this is cnbc. as your host, i have some rules. first, no showers longer than 5 minutes. this isn't a spa. (laughs) that's a rule. meanwhile, at a vrbo— when other vacation rentals make you share your turf with a host, try one that's all yours.

exxonmobil began the year by suing california's attorney general and several environmental groups saying they defamed the oil giant with statements about exxon's plastic recycling. in a september lawsuit said exxon received the state for decades promising the plastic it produced would be recycled but said very little actually is. exxon says california has a flawed recycling program. we spoke to bonita shortly after the lawsuit was filed. >> this case is to hold exxonmobil like their actions. they have hurt california and californians. billions of dollars worth of damage to our environment, to our people, and their answer and their statement is to point the finger at california, the people they hurt? >> right now we're going to hear

from exxonmobil on its own lawsuit it filed last week. for that we bring in chairman and ceo darren woods. darren, thank you for joining us this morning. what caused you to bring this lawsuit against the california ag? >> well, becky, you know, we've seen this growing trend where activists and idealogs, particularly in the climate space, and attorney generals are hijacking and abusing legitimate processes to advance their own selfish agendas. that was certainly true with state attorney general rob bonta. in fact, when he was on your show anountsing his lawsuit, didn't take many questions from you and andrew and joe to show he didn't know much about what he was talking about. in fact, he was lying. lying about our company, lying about our technology, and hurting the character of our people, interfering with our business, and most importantly, getting in the way of improving

the environment. ironic of someone taking the position on wanting to improve the environment is doing a lot to block and advance technology that, frankly, is going to keep billions of pounds of plastic waste from landfills and being incinerated and recycled back into products society uses. we invested through 2024 $200 million in this technology. we recycled 80 million pounds of plastic that otherwise would have gone to landfills. and we have plans to ramp that recycling up to a billion pounds by 2027. the attorney general could have easily called us. we would have been happy to explain it to us. we would have him out to our plant, show him the recycling, the virgin plastic we're making on the back end of the process.

>> the lawsuit claims you had prospective business deals that fell apart as a result. what happened? >> i tell you, the advantage of this project and technology, it's not subsidized by the government. there is a demand out there for recycled plastic that many companies -- we have contracts with 15 countries around the world to provide this. the attorney general is suggesting that what we're doing isn't real and it's a myth, it's a lie. obviously, consumer companies are looking to promote recycled content. our concern with those types of accusations, so we have to push back against what are essentially false hoods. i haven't seen a better example of gaslighting than what attorney general bonta is doing here. >> when he was on with us, when bonta was on "squawk box," he did point to the statistics that show, i think, from the epa that only about 10% of plastic that

was generated in 2018 was ultimately recycled. where are the problems? why aren't more of these plastics recycled? >> so, it's a complicated chain. there is a problem with collecting and sorting and processing the plastics. there is -- the current recycling technology has its limits. plastic today is not a simple, single element of plastic. they are very complicated structures to achieve the properties we're looking for in the use of plastic. many of those properties make them inconsistent for mechanical recycling, which is the technology that exists today. we've taken a fundamental step forward and taken those plastics it, no matter how mixed, commingled or complicated they are and we break it down to the lecular level to new plastics, in some cases it goes into gasoline, diesel or jet fuel.

true recycling. we do that by breaking that plastic back down to its fundamental elements at the molecular level. that's a very different approach. and we unlock the ability to recycle plastics today that can't be addressed with the current technology. but there is a huge challenge in collecting this plastic and getting it to units like ours to recycle them. we're actually investing and supporting firms who do that, who collect the waste sorted and deliver it to our sites. >> darren, this isn't the only lawsuit that you've done in the last year that's really kind of put you on the offense. last year you also sued some activist shareholders who were trying to push climate change actions more rapidly and kept coming back. i think you considered them corporate gadflys, pushing exxon on do things you didn't think were in your best interest. this is an aggressive way of pushing back. it's not what we've seen from

exxon in the past, even you in the past. what changed your mind that made you think, we have to change our strategy with how we deal with these issues? >> the abuse and hijacking of legitimate processes. we respect the right of people to disagree with us. we respect the right of shareholders to submit proxy proposals, but when they start skirting the rules and breaking the rules and manipulating the system, we've got to the draw a line there. same with the ability for people to take -- to disagree with us, take us to court. very happy to defend our positions in court. we were prepared to do that, but when you take that to the next step and begin to defame the company and cast dispersions on our people and the work that we're doing, you cross a line. and the way we've looked at it, if not us, then who? who stands up to stop the abuse? and, frankly, we think it's in the best interest of our shareholders to make sure we draw the line and we hold parties who are acting

irresponsible to account. we don't -- we don't push back against the legitimate processes that are in place for good reasons but when it's being abused for people, frankly, trying to advance their own personal agenda. secretary attorney general bonta sent out a fund-raising letter immediately after filing suit. it is blatant in terms of what his ambitions here are. frankly, the people of california deserve better than that. >> you filed this case against the california a.g. and texas. are the texas courts different than the california courts? how do you see the legal patch work in this nation? >> frankly, we're looking for courts that are objective and evaluate the cases on their merits. i think our judgment in texas is the harm done by the defamation that attorney general is pushing is basically occurring here in texas. it's occurring to a texas

company, exxonmobil. we have plants in texas where we are building these advanced recycling units and processing. that's been impacted. so the impact and damage done by the attorney general is occurring here in texas. we felt like that was the appropriate venue. >> there are a lot of ceos who are headed to washington this weekend for the inauguration. more than i can ever remember coming to an inauguration as corporations are kind of looking to a new environment coming out of d.c. i know you're not going to the inauguration, but do you expect to see a different business climate with this new administration? and have you had conversations with them? >> i have had conversations. i do expect to see a shift with respect to the focus on eliminating barriers that aren't productive or that get in the way of actually responsible business growth. i think, you know, regulations that limit permitting and limit

the ability of our country and businesses to build things is an important area that needs to be addressed. i think both sides of the aisle agree with that. i'm convinced the trump administration is going to be focused on trying to make sure businesses that have good projects, that grow economic activity, create jobs, grow wealth for communities, that he's going to try to make that process simple without undermining the intent of those regulations. >> the one thing i know that you're in favor of many of these regulations that you built businesses around when it comes to the potential for climate change, when it comes to trying doing emissions on different things, you've made it clear you don't want to see big wings because you've put money behind the initiatives. >> it's less about the money we put behind, more about the fundamentals. we don't build businesses based on government subsidies or the political whims of any one administration, but we come back to the fundamentals.

one of the fundamentals is people need affordable energy and they're going to continue to need affordable energy provided by oil and natural gas well into the future. but at the same time, the world needs to find -- take economic, thoughtful steps to reduce emissions. unfortunately, that issue, that challenge has been framed and controlled by very narrow group of people with very radical ideas that are impractical, inexpensive and do great economic harm and degrade people's standards of living. that's how it's been defined today. unfortunately, that's not the choice we should make. there are ways to do both. what we're focused on is let's find a way to continue to provide the energy the world needs. at the same time reduce emissions and not compromise people's standards of living or economic activity. >> darren, you've got -- even on -- i guess -- i don't know if

you've seen "land man" yet but the entire fossil fuel -- >> i have. >> you have seen it. >> i have. >> you've seen the speeches about how long -- what the demand for fossil fuels is for the world and how we all expect the way we live to continue and what that's going to take in terms of energy and fossil fuels for the next 100 years. it's not going to change. i can't believe it's on tv, darren. must bring a tear to your eye to watch it. i think you -- i think you can loosen up a little, too. you don't have to be quite as guarded about the business you're in. i don't know if this is a sea change or a silly tv show, but when i watch it, i'm so -- i don't know. i get a little teary. i'm not even in the oil business. i just drive a car. >> i have to admit, joe, i haven't teared up watching that. i find it entertaining. it's maybe an exaggerated characterization of the business but it's entertaining --

>> they do put up, you know, the very woke green lawyer that says that -- just the most insipid things to billy bob. that's what i like. >> we're trying to encourage not to let either extreme define the issue -- >> come back a little. >> what can we do -- >> you don't have to stay way out there. you don't have to stay way out there. you can come back a little. it's safe to go back in the water. you're gun shy now. you are. you are. >> i've been in the water -- joe, i've been in this water the whole time. the temperature of the water changes -- >> but if you were him and you were in that business, with the -- >> i will say -- >> the misinformation -- >> he has stepped out unlike anyone. >> but in the current environment, it's nuts. it's crazy. >> i think, you know, frankly, from a credibility standpoint, it's important to stick to the fundamentals, stick to continue to do what you think is right,

drive the business in the right way, find ways to make money and address the needs of society. we're trying to bring the capabilities that we have to bear to help solve some of the real critical challenges that society face. we think we have a real role to play there and we can do it in a lot of different areas. not just in producing oil and gas but producing lithium and finding ways to capture carbon and developing new products that are less carbon intensive and meet society's needs and make a profit. my view is we should stop focusing on the differences and focus on where we can agree and make progress and do it in a way that makes a lot of sense. unfortunately, a lot of policymakers aren't there yet. i hope the trump administration can bring practicality into this space. >> darren, thank you for coming and addressing all this stuff and speaking out. we appreciate it. >> thank you, becky. nice seeing you. thank you, too, joe. rick santelli standing by at

the cme in chicago with breaking -- i hope it's not -- the numbers, please. >> yes, yes. we'll look at stocks. they're giving you the clue. preopen equities are flying. interest rates are moving lower. housing starts for december, just a whisker under 1.5 million. 1,499,000. what's unique about this, even with last month's revision, moving up to 1.294 million, is that we have gone from the weakest level last month to june of 2020 last month, even with the revision, to today's number, which is the best since february of '24. a real switch. much of the weakness, as diane olick has been pointing out, is it in multifamily. what's the news this week? even though interest rates have gone down, and we will see mortgage rates catch up to that. previous to that, if you looked

at the mortgage bankers survey, 30-year topped 7%. with high interest rates in housing and even with this move in treasuries, they'll probably remain high. it's going to keep multifamilies in a positive light because it's more affordable. on the permit side, this is december preliminary number. it will change. 1,483,000. it's been hovering rnd 1.5 million permits. seem much less affected by the recent dynamics on the start side. if we look at interest rates, here's something interesting. 4.22 two-year is only down 16 on the week. if you look at a 4.57 ten-year, it's down four on the session, down 19 basis points on the week. a 30-year at 4.80 down six, down 15 basis points on the week. these are large moves. a ten-year from an interday perspective, joe, is at the lowest yield right now since the 3rd of january.

two-year note yields are making new passes at low yields for all of 2025, which i understand isn't that old really. and maybe the other thing you want to pay attention to, momentum building. this is the fourth consecutive session trading below the previous day's low yields. that's important. i wouldn't try to necessarily tie all this to great news on inflation. i think it's more about positioning. why do i bring that up? because long-end rates went wild. now they're going wild a bit in the other direction. it doesn't mean the fed's going to go wild easy because of the move we've seen post ppi and post cpi. back to you. >> rick, we've got diana olick joining us with more. hey, diana. >> hey, joe. as he said, this is one of those reports where you really need to separate out the multifamily from the single family and throw out that top line number. single family starts were only up about 3% month to month.

multifamily up 59%. multifamily is a volatile number because you can have a couple of developments that get started and that skews all of the numbers in one direction. we had seen an oversupply of multifamily. you had seen the numbers going down through much of last year. now you're seeing them go up. why? because mortgage rates are going up. and the builders are very concerned that people are not going to be able to afford homes. that's why you see developers saying, okay, it's time to put more multifamily starts in there, get more units because there's going to be more demand for rentals. what's interesting is in the builder sentiment survey yesterday, they said they were very concerned about higher cancellations in the single family builder sector. that's because of those higher rates. over 7% right now. people are pulling out of deals they made a couple of months before. the build are up slightly, both starts and permits are down year over year. that just shows the concern among the builders. they also cited concern about tariffs and costs for building

materials and inflation, again, as we've been talking about nonstop. these builder numbers, that top line number may be large but it's not what we need to see for single family, which is where we need more supply in the market. back to you guys. >> long-running problem. thanks, diana. diana olick. coming up next, the world economic forum kicking off in davos, switzerland. our coverage of that event is going to begin on tuesday morning. banking and the economy under president-elect trump will be a big theme. we're going to be speaking with the ceos of bank of america, jpmorgan, goldman sachs and morgan stanley. better interviews coming with uber, coca-cola, salesforce, microsoft, cisco and many, many more. it will be a very busy week right here on cnbc. make sure you tune in for it all. (wind, rain and rolling thunder) (♪♪) nobody's born with grit. british anncr: rose is really struggling. it's something you build over time.

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coming up, the secretary of homeland security joining us for his first -- his last, really, "squawk box" exit interview. we'll have him on in the future but today we'll talk to him about border security and handoff to incoming trump administrati. ayun.d wee coming right back. well would you look at that?

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welcome back to "squawk box." with president-elect trump aking office on monday, department of homeland security mayorkas is ready to step down.

secretary mayorkas joins us now. a lot to talk about, a lot to talk about the last four years. mr. secretary, thank you for joining us. i would start with, and we can talk about what you think you accomplished, but i would start with something that's maybe more complicated, which is were there things you either wished you could have accomplished or, frankly, had done differently? the reason i ask is because i wonder whether some of the issues around the border or other things ultimately led actually to vice president harris losing to now president trump? >> well, good morning. thanks for having me. i'm not sure i'm in a position to agree or disagree with your political conclusion as to what determined the election in november. there are different views having been expressed. i wish that we had more time and that would enable us to do more. not only in furtherance of our

mission but in the service of the american people. andrew, i don't tend to look back like that. i look forward and see what is ahead and can be ahead for the benefit of the american people. >> well, let me ask -- talk about looking ahead, there's a big issue on the table and that is h1b visas and how you think visas in this country should be worked, and even a divide -- forget about inside the democratic side of the aisle but there's a divide inside the republican side of the aisle about this. >> yes, it's a very interesting issue, the high-skilled labor visa under h1-b. there is bipartisan support and bipartisan opposition. i think there's a very vital visa program. i think our country actually has a visa system that is way outdated and is not tied to market needs. if we look north to canada, what

canada does is calibrate the number of economic visas it will issue each year according to the market needs that year. we have numeric caps on our economic visas that were set in the 1990s. that is just unproductive. >> do you think that's fixable? do you think politically there's a will for that, to fix that then? >> i think there is a political will. the question is, is there a political ability. everything, as you well know and i think everyone understands, everything involved in immigration is rather electric and quite divisive. but really, this is a matter of economic prosperity. the visa programs, whether it's the h1b, the agricultural worker visa program, whether it's the temporary unskilled labor visa

program. these are meant to fuel the american economy. we need additional workers to fill jobs that americans do not fill for a variety of reasons. and we need to fix this broken imoperation system, including the economic visa program within it. >> mr. secretary, put the politics of the election aside, if you want, do you not look at the immigration issue in this country and what has transpired over the last four years, given the number of people coming into this country illegally, given the firestorm this has created, the national dialogue about it, given some of the efforts, frankly, by the administration, especially early on, to be more lenient than they have been. do you think none of those things, if you could go back, you would do differently? >> look, andrew, yes. you have to understand something, and this is not specific to government but to

any large organization, including a government administration. people have different views on what the correct policies should be, what the correct operational measures should be. those disagreements, those different views are voiced. decisions are made. and then everyone marches in unity together. that is the nature of a large organization. and the government is no different. >> but just so i'm clear, are you suggesting your view -- your own personal views about how to operate this were at odds or there was a distinction between your personal approach and how you would have wanted to do it and how maybe your bosses wanted to do it? >> i don't want to get into the deliberative process. we're one team. it's one effort. but there is -- there is not a revolutionary concept that there are dispirit views when one has many people involved in the digs-digs

decision-making process. >> that was exactly, mr. secretary, the line of questioning where i was going to go and andrew effectively asked what i would have asked because there's -- there's a couple of things. any a.i. program, just say, what of the very first -- it was exactly four years ago. the executive orders reversed, which one of them -- list four or five that exacerbated the problem and allowed -- basically quadrupled the number of illegal crossings? you indicated to me that maybe -- you maybe wouldn't have halted remain in mexico, wouldn't have paused the border wall construction, wouldn't have relaxed deportation priorities, wouldn't have rescinded the public charter. i would say that. were you just following the orders from the people above you? i'd pass the buck, if i were you, because it turned into an s-show, the whole thing. quadrupled to almost 12 million versus 3 million illegal crossings. >> a couple things.

first of all, i'm not a pass the buck guy. >> i would. >> i'm not -- hold on. that's not a noble approach to service. number one. number two, let's place the challenge of immigration that this country has faced in context. that's in a global context because what we experienced at our southern border was not exclusive to our southern border. it is a phenomenon that many countries around the world, not only in our hemisphere experienced, because we have had the largest level of displacement in the world since world war ii. so, the challenge of migration started well before this administration. in 2018 our border experienced approximately 560,000 individuals encountered. in 2019 that number almost doubled. and so the trend was under way

in terms of the level of displacement. that is mirrored in other parts of the world as well. and then the covid-19 pandemic hit. that, of course, materially impacted people's decisions as to whether they could leave their countries of origin and migrate elsewhere. >> mr. secretary, let me ask you a strategic question. we have heard from president-elect trump some very loud and specific rhetoric aimed at mexico, the leaders of mexico, aimed at the leaders of canada about the help that he believes they should be implementing to help the united states prevent illegal immigration. my question to you is, how much of the problem lies with mexico or lies with canada, how much of it lies with what we're doing on our end? if you were to create a pie chart and sort of assign effectively responsibilities to these things, because i think there's a real question of how

much it's going to ultimately cost us and what kind of procedures we need to put in place to make all of this happen. >> all right. it's a really important question. and i think every country has a significant role to play in managing migration. it is not up to one country. and i have said this for many a year, that if our border is the first line of defense, it is too late. let me share with you a very powerful example of that. in december of 2023, we experienced the highest level of encounters of any one month, i think, potentially in our history, and certainly in the past 20 years. what happened in december was that the mexican enforcement agency was unfunded and so there was no interdiction effort. we saw trains coming to the border carrying thousands of individuals.

you may recall that president biden then spoke with president lopez obrador and dispatched secretary blinken and me to mexico to explain what the problem was and what we needed mexico to do in partnership with us. president lopez brador took action, refunded the agency, and in january the numbers plummeted. that's an example of the importance of interdiction of another country enforcing its laws before individuals arrive at our border. so, it is a shared responsibility. >> mr. secretary, let me last leave you with one other question. a lot of americans to the degree they come into contact with homeland security, they come into contact with the tsa at airports. recently we've heard all these very unusual stories of people boarding planes that shouldn't have been allowed to board planes, people that got into

wheelbases of airplanes. all sorts of unusual things happening. how should we think about the security at airports today? is it good, bad, airport feeder, a lot of other questions about it? >> it is very strong. i will say that when millions of passengers fly every day across the united states and across the world, people who come into airports now do not think about whether they will arrive safely at their place of destination which was, indeed, the case years ago. they are now thinking about how easy and comfortable their travel will be. there indeed have been a few cases of individuals becoming stowaways, which is a security lapse. it is security, again, is a shared responsibility. certainly it is shouldered by tsa. it is also shouldered by the airports and the airlines. here again, it is a partnership

that drives security. we have to keep that in mind in every aspect of the work of the department of homeland security. >> mr. secretary, i want to thank you. want to thank you for your service. we hope to have you back -- i think we'll always call you mr. secretary at this point. you get to keep the title. >> i want my name back. >> you get the erhonorific. "squawk box" will be back after this.

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a programming note to tell you about. the markets are closed on ay for march ten luther king day. normally we wouldn't have programming but because of the inauguration, cnbc is hosting a special presentation of the inauguration of donald j. trump. we will have coverage of all the events live from washington, d.c. our coverage starts at 8:00 a.m. eastern time. we have a big lineup of guests. appearances from investor stan druk miller, david rubenstein and walmart ceo dug mcmillan. lots of other things. roger ferguson, reporters who will be covering all aspects of this, special reports from the ground on the issues that matter most to your money. don't miss any of it. make sure you tune in with us. by the way, "squawk box" will be both in washington next week for the inauguration and in davos. a big week with lots of guests coming your way. let's take a very final quick look at the markets for the week on "squawk box." dow futures up by 228 points.

nasdaq futures indicated up by 300 points. the s&p up by 45. treasury yields have come down through the course of the week after we got those cooler than expected inflation numbers. 458 for the ten-year. 4.23 for the two-year. that about does it for us this week. we do have a lot going on. we're headed off see you from a locations. >> all parts. you're in ashington, i'm in davos. >> we will be washington. >> and then you will be back in new york. >> we will all be on the air. >> i won't be on the air. >> tuesday you will in d.c. good friday morning and welcome to "squawk on the street," i'm sara eisen here with jim cramer at post 9 of the new york stock exchange. carl and david have the morning off. futures this morning heading for an up week on wall street. s&p is up 2% coming into the day, looks like we're going to build on gains up 44 points here ahead of the open. dow futures up 237. our roadmap begins with the best week for stocks since november.

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