>> good morning. >> everybody. >> and welcome. >> to. >> squawk box. >> right here. >> on cnbc. >> we are live. >> from the nasdaq market site. >> in. >> times square. >> i'm becky quick. >> along with mike santoli. >> and robert. >> frank joe and andrew are. >> off today. gentlemen welcome. >> good to be here. >> good to be here. looking good in the suits. >> across the board here. >> let's take a look at what's. >> happening with the us equity futures. >> at this hour. >> you'll see right now. >> there are some. >> declines at this point. >> dow futures off by. >> about 80 points. >> s&p futures. >> down by just over. 30 points. the nasdaq down by. close to 200 points. this does come after the markets. all three major averages. >> saw their first positive session in. >> the last three. we'll continue to watch and see what's happening with some of these things, but obviously some of the pressures that we've seen with these technology shares overnight adding pressure, especially to the nasdaq. >> alphabet for sure. amd as well. and so yeah, a little bit of a setback. you know we actually did a round trip week

to date monday trade concerns s&p down three quarters of a percent yesterday up three quarters of a percent. almost landed in the same place we closed last week. never mind. but it's been this kind of yeah. but it's so it's been this kind of low conviction kind of apprehensive range that we've been in waiting for the next headline with an undercurrent of decent earnings facing high expectations. >> volatility hasn't been too strong. 17 i think was where the vix was yesterday. and which if you. >> think about it you. >> know imposing. >> china tariffs of 10% on. >> its own. >> if that had. >> just happened. >> in isolation without all the other. >> stuff you wonder. >> whether the market would be sort of more consistent with it. >> but but to. >> think that the market is holding. >> in there. with the. >> 10% tariffs. >> on now. >> it's. >> better than. >> people expected. >> and so maybe. >> there's a bit of a relief rally. i think there's also. >> the expectation. >> when you saw canada and mexico those tariffs go away before they even started. i think there's the expectation that there will be conversations with president xi and maybe that things will amp down, not amp up, but we'll see. we'll see. >> we'll see. today it doesn't.

seem like it. >> and also. just hats off to squawk box and you monday kevin hassett. you and i had the same reaction to his interview when i saw that interview. and hopefully when traders saw that interview and they did, i just thought, wow. >> this may. >> not happen. >> i that. >> was the first time were able to trade stocks that morning after hearing that kevin hassett interview, i would have bought, because it. >> was clear to him that. >> those two calls, those phone. >> calls were. coming up later that day. >> and he was already. >> saying. >> well, there's already been progress. that was a very different message from what we've been hearing over the weekend from president. >> trump and others. >> it was. >> a different conversation than i expected to be having with him that morning. kevin, obviously is an economics adviser or an economic adviser, and you would expect that he would have been talking the economics of tariffs, and that was not what he wanted to talk about. >> i mean, we've talked about this, but i mean, the administration needed the emergency powers, and they had to say there was an emergency about fentanyl to actually do anything. and also. >> kevin didn't have to. >> this president. well, you kind of do. if the lawyers are like, hey, this is what it's about. but i also think that, yes, it's relief that it's not

about just pure aggression. let's get the maximum tariffs out there for sure and let them stick. but you're preserving the leverage. it's always 30 days forward. it's always there. yeah. and so i don't think that that's necessarily an overwhelming negative. it's not the big swing factor for the market. but if you're an investor and a trader you can never be comfortable that it's been set aside. >> i guess. >> the. >> question is absent this this trade issues right. >> now, what. >> would the market be doing based. >> on earnings. >> and based on yields right now? >> it's a good question. i mean, i have a feeling it might be a little bit freer to move. and i think earnings expectations are high enough, though, that i still think you'd see all this back and forth chop. you mentioned the volatility index at 17. that's low ish. >> it doesn't feel. >> like it's all this movement under the surface that's kind of canceling itself out. and that the index level you know the s&p 500 closed the day after the election 5929. it's been at the high up 3% from there at the low down 3% from there. and we're kind of right in that zone

again. >> so we're. basically where we were. >> on right. >> after. >> the it's a dog on a lead. you know it's a lot of movement but it's not getting anywhere. >> let's take a look at the treasury. >> yields right now and just check out where things stand. if you're looking at the ten year you're going to see that right now. it's sitting at 447. so yields have come back down the two years at 419. we do have adp data this morning. so we. >> could. >> see some movement around that as well. also gold yesterday closing at an all time high. so it's probably worth checking that out this morning at $2,893.70 an ounce. and then wti at the lowest levels we've seen since last year. december 30th was the last time that we saw a close like this. this morning it's off another 7/10 of a percent to $72.20 a barrel. shares of apple. are sliding this morning after that. bloomberg report that showed chinese regulators are considering whether to open a formal probe into its app store fees and policies, the report said. china's market regulator is considering an investigation into apple's cut of up to 30%

for in-app spending, as well as blocking third party payment systems and other app stores. apple and china's commerce ministry were not immediately available for comment when they were contacted by cnbc overnight. but guys, this is really interesting. not that this whole investigation of the app store is new. we've seen that from regulators around the globe. the timing is very unique, and it's also a way for china to do this without affecting the many, many chinese jobs that rely on apple manufacturing. >> well. >> that's the. >> delicate balance, right? i mean, they they haven't gone hard against apple in the past. given the number of jobs there. and i. >> think this is just. >> sort of a shot across the bow. >> any you know. >> to. >> america. >> you're going to come after us with tariffs. we've got a lot of corporations, your corporations that make a lot. >> of money. somehow from whether. >> it's the chinese consumer or manufacturing here. and we. >> have a lot of leverage and that china's not in a mood to just rush to a point of putting some concessions on paper and saying, let's make this go away, the 10% tariff. so it's a little

bit. >> of back and station. yeah. than it was with both canada and mexico. yeah, yeah. >> meanwhile, shares of google parent alphabet are falling earnings of 2.1 $0.05 per share beat estimates by $0.02. but revenue fell short by just a bit. two key metrics google cloud revenue and traffic acquisition costs also fell short of estimates. youtube ad revenue beat expectations. alphabet also announced plans to invest $75 billion in capex in 2025, as it continues to expand on its ai strategy. the street was expecting about $59 billion in capex spending. today's decline roughly wipes out alphabet's year to date gains. this is a company that had had a nice run. the stock, it looks inexpensive. the street does not fully trust alphabet and hasn't for a long time in terms of capital allocation, that they're not just going heavy and spending because they they sort of have to. and so i think that's a little bit of the discomfort. >> yeah. and it's not the same

mistrust that they have with meta when, when meta first. >> when they. >> the metaphor when they did the metaverse when they were going into that i wouldn't say it's the same. but there is it rhymes in some degree. >> right. especially sundar pichai said, look, maybe it's all wasted, but we still have to do it. i mean, you know, you know, that was quarters ago, but still, i think that's that's the discomfort. look, they still bought back the same amount of stock last year. it's not like they can't afford it. and but the cloud business you'd want to see it accelerating if that's so. >> and it came. >> in in tandem with them saying that their cloud revenue was not exactly showing up in the same way that they had anticipated. you're not seeing as many of those new, smaller players that are then transitioning into the cloud. you also wonder whether deep seek. >> has made. >> investors a little less. patient about, okay, you're upping your capex by 30%, up to $75 billion, okay. we're fine with that. but we are also aware. >> of. >> these cost. >> pressures that are coming. >> from the low. >> cost provider. search. and youtube is still more still all the earnings basically. and so and youtube. >> came in. >> quite strong. >> and that. >> was kind. >> of surprising that.

>> ad sales. >> and i mean. >> we hear all these things about the ad market right now. but youtube was strong. >> now they're winning. all right. well shares of chipmaker advanced micro devices are falling as well. earnings of $1.09 per share beat estimates by a penny. revenue also beat amd's most important unit is its business that sells chips for ai data centers. amd reported $3.86 billion in data center sales. that was up 69% year over year, but did fall short of expectations. current quarter guidance was roughly in line with expectations to see the stock down about 8.5%. >> all right. >> meanwhile, president trump. >> proposing a. >> new middle east peace plan involving taking. long term, long term control of gaza and rebuilding it to the riviera of the middle east. eamon javers joins us now. >> with more. >> eamon. >> yeah. good morning robert. president trump made a surprising. >> suggestion last night during. >> a press. >> conference with israeli. >> prime minister benjamin netanyahu. the united states, he said, should take. >> over the war torn. >> gaza strip. >> where israel has. >> engaged in a bloody.

>> war with. >> hamas for more than. >> a year. >> and redevelop it. >> into something like. >> a seaside resort. here's what he said. >> the u.s. will take over the gaza strip, and we will do a job with it, too. we'll own it and be responsible for. >> dismantling all. >> of the dangerous unexploded bombs. >> and other. >> weapons on the site. >> level the. >> site and get rid of the destroyed. >> buildings. >> level it out. create an economic development that. >> will supply. >> unlimited numbers of jobs and housing for the people of the area. >> now, trump said he sees the area as the riviera of the middle east, and that developing. >> it would. create thousands of jobs. he also. said american. troops could be involved to control the area. >> if necessary. standing beside trump. >> netanyahu confirmed. >> that israel and the us are in talks about the idea and said, i. >> think it's something that could. >> change history. the gaza. >> strip includes. >> 25 miles of mediterranean.

coastline and a territory that is one of the most densely populated in. >> the world, home. >> to an estimated. >> 2 million. >> palestinians. >> trump's proposal seemed. >> a sharp departure. >> from his tone on the campaign trail, which was sharply critical. of us. >> military and diplomatic. >> involvement in the middle east. >> but members of. >> the trump family, guys. >> they've eyed the real estate potential of the area. >> before, trump's son in law, jared kushner. >> said last. >> year that gaza's waterfront property could be. very valuable. >> and we got a reaction. >> from hamas leaders overnight as well, guys saying that. trump's comments represent confusion about. >> palestine, and. >> they say that this is simply not something that's going to work. back over to you. >> yeah. eamon. what would legally i mean how would this work. was there a discussion? i know the details were scarce here. >> but of. >> buying it of just taking it over, i mean, what would be the mechanism through which the us. gains control, or was. >> there any discussion of that?

>> i mean, there's no underlying detail here, robert. i mean, this is the president throwing out an idea there. i mean, you could see from, you know, just the clip that we just played, he was reading these comments off of a prepared script that he had in front of him. so clearly there's some thinking that's gone into this that, you know, this wasn't just totally off the cuff, but we didn't get any background details from the white house in terms of exactly what, you know, how this would work. what the president said is the us would simply take over gaza, presumably because the israeli military has cleared out resistance and bombed out enormous amounts of territory there. the question is, you know, who would legally run that? would that be sanctioned by the un? and then what would hamas say about that? right. i mean, obviously, this is a hotly contested piece of land has been for, you know, basically forever, you know, the amount of resistance that we would get there would would be epic. you know, the reaction on capitol hill overnight, you know, people

were sort of agog over this, you know, looking at it and saying, you know, how would this even work? this seems like a nonstarter, you know, but the president is a real estate developer, and he sees things in those terms. >> yeah. >> it's the 51st state of canada, it's. >> greenland. >> it's panama, it's now gaza. he he likes land. he likes buying and owning more land. yeah. i mean it's. >> interesting though. i mean, this is an isolationist president, right. who ran on the idea of getting out of the middle east, not getting the us involved in forever wars. and then here he's floating the idea of american troops in gaza, which is, you know, one of the biggest flashpoints on planet earth. and you can imagine, you know, if baghdad was difficult, gaza would be, you know, x, you know, percentage more difficult than that in terms of a military campaign. you know, it just it's at odds with sort of his whole approach on the campaign trail as well. >> yeah. and it's at odds with, you would think even the conversations he has had with saudi arabia, mbs has been a

close ally in the past of the trump administration. just a little strange to think of. and i've been trying to go around and round figure out what they could possibly mean by this. in your most generous assessment of it, you could try and think of a marshall plan. but this is not that, because he has said he would remove the palestinians and go in and actually potentially send u.s. troops in. so it's very different from that perspective. obviously, there's something that needs to be done in gaza post the israeli invasion and the damage that's been done there. but this is very different from the marshall plan after world war two. >> yeah. i mean, the immediate criticism you heard over the over the night last night was that, you know, this is ethnic cleansing, right? i mean, talking about removing the entire population of palestinians and replacing them basically with tourists at a at a mediterranean resort. you know, that's not a great look. the president didn't say,

though, that he wanted to remove all the palestinians and the plan that he kind of teased last night. he said that world people, meaning people from everywhere, would live in gaza once it's been redeveloped, along with palestinians. but he also seems to envision removal of a large number of palestinians. remember, there's 2 million people crammed into a very small area there. he seems to envision removing a large percentage of that population to other arab countries throughout the region. those countries have signaled that they don't want to take those populations, so it's not clear where those people would go. trump simply making the argument that gaza is bombed out and destroyed and really uninhabitable right now, and the palestinians should, he said, want to go somewhere else. you know, i think that's going to be a question for the palestinians, right? i mean, you know, ask them where they want to go and what they want to do. but clearly, you know, if you're going to turn this into a middle eastern, you know. >> i don't think they want to go anywhere. that's been the point.

>> the palestinians might want to own it. right? i mean, you know, what's their what's their equity stake in this new deal. >> yeah. >> ayman. so complicated. not going to be an easy real estate deal. >> even even for trump. >> ayman, thanks so much for the update. we appreciate it. >> you bet. >> all right. coming up earnings and jobs data on today's agenda. the squawk planner is next. take a look at futures under some pressure s&p 500 down just around half of 1%. and later this hour congressman james comber is chair of the oversight committee. he'll join us today ahead of this morning's hearing on rightsizing government. squawk box will be right back. >> this cnbc program is sponsored by baird. visit baird difference.com. >> in the all new infiniti qx80. the party in the. back doesn't stop. >> hi, frank. >> hey, goldie. >> i'm looking for those reports from yesterday. >> they're already on your desk, frank. >> for the. >> business in the. >> front experience more in the. >> all new. >> three row infiniti qx80.

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first. >> what's your take on not just the quarter but how things look from. >> here helping you make the right moves. >> this has been a key number. >> the street was watching. >> a wild. >> hour of earnings. >> earnings yeah, it is weird that we still call these things phones. well, yeah. they're more like mini computers. precisely, next slide. xfinity mobile customers are connected to wifi 90% of the time. that's why our network has powerboost with wifi speeds up to a gig where you need it most. so, this whole meeting could have been remote? oh, that is my ex-husband who i don't speak to. hey! no, i'm good to talk! xfinity internet customers, cut your mobile bill in half for

your first year with xfinity mobile. plus, ask how to get the new samsung galaxy s25+ on us. >> sign and. >> make official. >> start your. >> will at trust and will com. >> and make it count. >> welcome back everybody. on today's squawk. >> planner economic data ahead we're going to be getting the latest adp report on private payrolls. that comes at 8:15 a.m. eastern time. then at 830 we will get the december read on international trade. on the earnings front, we'll be hearing from uber, harley-davidson and then the big report of the morning disney. all of those numbers coming before the opening bell. disney cfo hugh johnston is going to be joining us after that report. first on cnbc. >> a new call from morgan stanley chief economist michael gapen says the firm now expects just one fed rate cut in 2025. that's versus a previous projection of two rate cuts. in a note, he says on again, off again tariff uncertainty should

raise the hurdle for fed cuts, something the market has been trying to contend with for a little while here. joining us now on the markets. amy wu silverman rbc capital markets head of derivatives strategy. amy, great to see you this morning. we were just talking about how, you know, broadly speaking, the market has been resilient but kind of churning as it rotates around and tries to digest a lot of these issues, suppressing, you know, index level volatility. how are investors kind of treating this set up and how does it play into what you think volatility might become? >> look, i think. >> this year is going to. >> be interesting. >> we've kind of joked that this is. >> a paddling duck. >> market right. >> you get that calm and smooth. >> duck on the surface. but those little. >> feet are. >> violently paddling underneath. and that's. >> kind of the rotation. >> you're seeing, which to. >> some degree. >> suppresses index level volatility. >> you know. >> if you. >> think back to this week, we didn't actually. hit a. >> close to close vix. >> over 20. >> which is kind of your

psychological. >> barrier i think. >> that's fascinating because anyone we speak to would probably say they felt like there was more volatility. there certainly was more intraday volatility. >> but you know my one. >> key takeaway. >> is. >> volatility can go a lot higher. because if you do get that correlation picking up things starting to co move together in particular with macro news we certainly have a long way to go. and you can see that you know back to 2018 when we had our last trade war. >> for sure. you know 2018 obviously was pretty eventful, but it was preceded by a very long period of time. in 2017. we had low, low volatility. the market was just kind of stair stepping higher. you had pretty calm on the macro front. i wonder right now if it feels as if this dispersion, you know, the kind of the way different stocks and sectors are moving separately from one another and that kind of offsetting action, if you see that as being an actual strategy. in other words, are there traders or players in the market that are essentially

trying to capture that effect as opposed to it just being, you know, the result of investors in individual stocks doing what they're doing? yeah. >> yeah. >> that's a really. >> great question. and that's a really. >> great nuance. >> so i will. >> say two things. you know, certainly. >> there is just. >> idiosyncratic and fundamental investors all the time who are doing their stock picking. and certainly there's a lot of kind of different sectors that will have different impacts based on fiscal policy. cabinet picks. et cetera. but to your second point, you know, the short answer is yes. there's actual dispersion strategies in the market between, you know, being short index volatility or necessarily long single stock volatility. but the other thing we're just seeing is there's just rampant volatility harvesting. so meaning people who are just selling volatility to gain extra yield. and that's been a culprit i will say people like to blame that for some of the index level volatility suppression we've seen. if you just look at the growth of notional volatility etfs that are shorting volatility, you know that's certainly possible.

i would say honestly it's a culmination of all these things. but you get one big pothole that that really could flip like a switch. and that's what i think folks are kind of angsty about this year in particular, after 220% plus s&p years. >> right. and how does the pretty aggressive flow from retail traders in certain parts of this market. i mean, you can observe it in in individual stocks. you can observe it in the aggregate options trading data. how does that play into all of this. whether it's people kind of, you know, trying to ride it or maybe play against it. >> yeah. >> so watching the retail flow has been fascinating because while institutional investors, i would say to some degree were relatively long, were actually picking up on hedging. you saw a lot of retail buying the dip. it's almost the same mentality we've had since post-covid to not only buy the dip, but to also be long call options to some degree in this market. that has been beneficial because it's sort of, you know, you have a long buyer on one side and short

volatility on the other. but, you know, the other thing that we're seeing is the tenors that retail investors are going to are also getting shorter. and that's also creating some structural changes in our market. so for instance going into zero day to expiry options versus going to tenors. that used to be, you know, one month to three months long has really changed the structure of our market. there's barely a. >> dip to buy. i mean, there was a 5% dip for about five minutes. >> for a hot second. right. and then it went away. yeah. >> yeah. >> that's the. >> yeah amy thank you. really great perspective there. yeah. in fact you hear people on the street say that there's actually dip buying competition to buy the dip and that therefore it reduces the dips until something really cracks. >> yeah. i mean, that's been the weird thing is everybody who comes on our program says they buy the dip. >> it's like. >> what dip? >> yeah. >> you know, anyway. >> when we come back, robinhood abruptly changing course on its plan to take super bowl bets. we have that story right after the break. right now, though, let's take a look at shares of

snapchat parent snap. >> earnings revenue. >> and daily active users, all beating estimates and current quarter revenue guidance mostly higher than the street expected. so you can see right now the stock off by about 1%. it's a decline of about $0.11. >> squawk box. >> will be right back. >> will be right back. >> on. squawk is sponsored by at ameriprise financial, we know our clients are so much more than clients. they're conquerors and champions, parents and caretakers, believers and breadwinners. the goals that matter most to you matter most to us. helping you achieve them is what we do best. with personal financial advice from an advisor you can trust, and goal-based investing in solutions. it's no wonder we have a 4.9 out 5 client satisfaction rating. ameriprise financial. advice worth talking about.

legendary investors quietly ignoring that advice. >> and instead. selling the stock hand over fist? every billionaire on your screen has recently sold nvidia. some have offloaded millions of shares. and mark my words, this is bigger than nvidia. hedge funds are quietly. >> selling all. >> of their tech stocks at the. fastest rate we've seen since 2016. it begs the question what do they know that you don't? my name is mark chaikin. i help build three indices for the nasdaq during my 50 years. >> on wall street. >> that means i know how to recognize these signals from the tech market and exactly what they mean for you and your money. >> i explain. >> everything in my new market briefing, including the truth of what's going on with nvidia today and the specific stock. >> i recommend you. >> buy instead. i'll give you its name and ticker when you visit the website below. nvidia

has been the most talked about stock in the market, and for good reason. it's led the ai revolution that has taken the us. stock market by storm since they announced their ai powered computer chip in 2023. nvidia stock has been on a history making. >> tear. >> officially surpassing microsoft to become. >> the world's. >> most valuable company. today, however, many investors are worried the tide is changing. nvidia's day in the sun may soon be coming to a dramatic end. and as a result. >> i predict. >> a different, under-the-radar stock is primed for big potential gains from this moment on. to get its name and ticker 100%. >> free. >> simply visit the website >> simply visit the website below. oh, it's cold outside. time to protect your vehicle from winter's wrath. of course, the hot sun can be tough on vehicles too.

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offering them. robinhood's general counsel said that they believe they were in compliance with all applicable regulations, but they did agree to the cftc request. raymond had launched the betting options on monday through a partnership with caci, which is the online prediction market. caci is barred from listing contracts that involve gaming and that are against public interests. but the definition of gaming isn't spelled out in the law. caci does offer one contract on which team will win, but other contracts are for things like which companies will run ads during the big game, and what songs will be played at the halftime show. robinhood said that users who placed bets before it removed the options will have the choice between either closing out those positions or keeping them through resolution of this situation. robinhood went on to say that they thought that they had signaled very clearly to the cftc what was coming. they were surprised by this, and i think it was something like 1% of their clients that this had been rolled out to before it was pulled back.

>> robinhood has expressed a willingness to explore actual sports betting, which of course is not legal in every state. yeah, to keep that in mind. and i look, they they they're in charge of what they think their brand is and they think their brand is whatever our customers want to transact in. we have the interface for it. and in the meantime, they kind of brag every earnings period of saying, oh, we got dribs and drabs of assets from fidelity. we're actually going to be a long term. like i'm not sure you you can really reconcile those things long term because betting is a zero sum game. investing is a positive sum game. and they. >> were trying to and they were trying to distance themselves. from the accusation. >> that. >> they were a. >> gambling site with confetti. >> and all this. no. >> we're we're. >> now for. >> serious investors. so i think this probably is a positive. >> move that. >> they're moving away from. >> the. >> gambling part of it. >> we'll get a work around. >> we'll see. >> all right. coming up, reports. >> say nissan plans to reject. that merger deal with honda. details coming up next. and right now, as we head to break a look at yesterday's s&p 500 winners and the losers.

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to three vetted fiduciary financial advisors@smartasset.com. >> good morning, everybody, and welcome back to squawk box. we are live from the nasdaq market site in times square. the futures this morning under a little bit of pressure. dow futures are down by 62. the s&p futures off by close to 30. the nasdaq is down by just over 180 points. and that's where we've seen some of the real weakness that's coming from not just alphabet but also amd. and we'll talk a little bit more about those earnings reports that we got yesterday. >> shares of novo nordisk are higher. the maker of wegovy and ozempic reported better than expected net profit in the fourth quarter and soaring demand for those obesity drugs. but it is forecasting a slight slowdown in sales for the full year. the company's ceo will join us live from copenhagen in

the 8:00 hour. you see shares up 3.6% right now. meanwhile, amgen disclosed the fda paused the study of its early stage obesity drug. the company did not elaborate on why or when the trial of amg's amg 513 was placed on clinical hold, but said it was working with the fda to find a path forward. the company is another drug merited in trials, but it fell short of expectations in 20. in a 2024 study, the company also released new guidance for sales in 2025. the top end of the range did exceed analyst estimates. amgen shares down 1%. >> and we're watching shares of honda and nissan. multiple reports saying nissan is going to reject that acquisition offer. that would make it a subsidiary of honda. nissan's board held a meeting earlier this morning, but has not yet put out a decision or a statement. that's going to. >> have. >> a lot of ramifications for the whole global auto market. yeah, and as somebody who drives a nissan, i'm very eager to see what changes come along on this.

>> we shall see. >> when we come back. congressman james comer is going to join us. he chairs the house oversight committee. they're holding a hearing today on right sizing government. we'll have that conversation next. and a reminder for you, you can get the best of squawk box in our daily podcast. just follow squawk pod on your favorite podcast app and you can listen at any time. squawk box will be at any time. squawk box will be right back. (♪♪) (♪♪) what took you so long? i'm sorry, there was a long line at the thai place. you get the sauce i like? of course! you're the man! i wish. the future isn't scary. not investing in it is. nasdaq-100 innovators. one etf. before investing, carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com

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pro. >> cnbc pro is for investors who know about the news and the trends, but then want to take it to that next level. exclusive access to market experts to help you identify opportunities in any market. >> unrivaled access, essential tools. >> that's cnbc pro. everything you need all in one place from a source you trust. >> go pro with a flash sale offer for a limited time at cnbc.com. slash pro flash terms and restrictions apply. >> all right. >> welcome back everybody. >> our next guest will oversee a hearing today on capitol hill focused on rightsizing the federal government. joining us right now is house oversight committee chairman james comer of kentucky. and chairman comer, i know that you're going to be listening to a lot. what are you kind of going into these hearings thinking ahead of time, just in terms of what needs to happen at the government level?

>> well, we can't. continue to have $2 trillion deficits. that's unsustainable. and we have a president now that's serious about trying to get unnecessary spending under control. it's easy to increase. >> spending in this. >> building here in the capitol. but when you talk about making cuts and people start. losing their minds, i think we have a population. and a society that is addicted. >> to government. >> spending, but unfortunately, we're going to have to get that under control. and that's what we're going to talk about today. we're going to talk about a lot of the stuff that doge and elon musk have been proposing. we're going to talk about a lot of the executive orders that president trump has been signing. and i'm sure it will be a very lively discussion, because, to be quite honest with you, the republicans on the committee are very serious about trying to get the backs of the taxpayers and. >> get spending. >> under control. and we have a lot of democrats that just aren't. >> very interested. >> in making any type of budgetary cuts. >> you know, i think that's really interesting. i think there is obviously bloat in the

federal government. something needs to be done, and we'd like to see that action taking place. i think the questions come down to where does the authority lie with that? is it going to be elon musk and doge that are responsible, or are they just giving ideas to congress? and you all are going to be responsible for coming up with some of those cuts. how does it work? i think those are where a lot of the questions are lie right now. >> yeah, that that's a. >> great question. and we're going to be having a lot of debate, probably a six hour committee hearing today talking about exactly that question. i think with respect to regulations, i think you're going to see the president do a lot of executive orders and reforming government agencies to try to bring some common sense back and cut some red tape and reduce unnecessary costs to the private sector with, with a lot of these government agencies, whether they be the department of energy or the department of labor, wherever we're talking about, with respect, from an agency standpoint, that issues burdensome regulations, unnecessary regulations, i think

the president can do that with respect to a lot of what elon musk and doge is talking about from a budgetary standpoint, then that's going to have to be congress. and we're going to debate that today. the usaid has been very controversial, but we've been very critical on my committee of that. we've asked for a lot of information with respect to where funds were going in the biden administration, and we never received anything back. we fear that there is a lot of that money that was maybe even pouring into some of the ngos, the non-governmental organizations that were paying for the transportation of illegals and housing of illegals in the sanctuary cities in the united states. we've got all kinds of reports that much of the foreign aid wasn't actually making it to the front lines in some of the countries where they were supposed to be going to, to assist. so we want to look at every dollar that's been spent in the federal. >> government because. >> it hasn't been reviewed. you know, you look at the pentagon, the pentagon's failed six

straight audits. this federal government is out of control. and we've got to get it under control. elon musk is taking a lot of criticism from the left and from the media, but i appreciate that he's interested and volunteering his time to try to get government spending under control. and hopefully our committee hearing today will be able to dissect that even more and try to find real savings for the american people. >> chairman kilmer. >> one of. >> the things that elon musk is targeting. >> next is. >> the irs. >> he's calling on. >> his x. >> account to. audit the irs. >> you talk. >> about the spending. >> problem, but we also do. >> want to, i think. >> collect the revenue that is owed. >> from taxpayers. >> and they've spent a lot of their money going. >> after, for instance. >> wealthy taxpayers that still owe back taxes. what's your view on the irs and whether funding should be cut there, and. >> what impact. >> that. >> could have. >> on revenue? >> well, i think the irs is needed. there will be some republicans say to abolish the irs. i don't know how you do that and collect taxes, but at the end of the day, i do think

the irs has a record of inconsistency. i think they have a record of targeting conservatives. we saw in my investigation of the biden family with the two irs whistleblowers came forward. an, you know, validated much of the claims that we were making in the committee and said they were told to stand down, but that at the same time they were going after donald trump. so you had a two tier system of thinking at the, at the irs. i think that the irs needs to come in and explain themselves. i think they need to be transparent. they haven't been transparent. we know that the previous administration wanted to double the size of the irs and double their budget. but i can tell you with certainty, the irs is one of the worst offenders in washington. from the stay at home policies of the biden administration, there's still a significant percentage of irs workers who aren't coming to work every day. they're working from home. and i don't know what you can do from home on your private server with respect to social security numbers and things like that. so we have a

lot of questions for the irs. and hopefully over the next few months, we're going to bring these government agencies in and they're going to be able to explain themselves. i'm sure that some of the programs that musk and some republicans have talked about cutting, they may make a solid case that they need to continue. but i think a lot of these programs are in jeopardy, and i think that the taxpayers will be better off if we can eliminate these programs. >> chairman, i guess the question comes down to, do you have unanimity in your party in terms of some of your thoughts on this? because it's a pretty narrow majority that you hold. the democrats have been very vocal about their concerns about what have happened with some of these issues. and look, it's one thing if elon musk has a line item veto and can go through it, it's a very different thing. if it goes through congress and i'm hearing from you that you think it is congress's place to do these things, can you get a pass? >> it's congress's place with respect to the purse, with respect to funding the

government, funding these agencies. i think a big part of what doge is going to do is on the regulatory front, and that can be done through executive orders with the president. doge itself doesn't have any authority. i know the some in the left wing media is trying to say he's he's an unelected president of the united states or unelected bureaucrat or whatever. he's just a volunteer that owns a big platform that was formerly known as twitter. that's that's throwing a lot of ideas out there. and there are a lot of people in congress that are intrigued by his ideas. and i think that that's great. but at the end of the day, we're going to have to come together. when i say we, i'm talking about us in congress. we in congress, we're going to have to come together and determine which agencies are funded and which agencies are not funded. that's a role of congress. but again, the doge, i think doge is going to make its biggest impact on the regulatory front. and they've already made a difference. and already we've already seen significant savings

from their from their ideas. >> mr. chairman, hasn't doge already effectively shut down usaid? i mean, no matter what you feel about the questionability of some of what their funding was going toward, it feels as if they've kind of dismantled it. >> usaid was created by an executive order. so in the thinking of president trump, it can be undone by an executive order. there are still worthy projects that were funded by usaid. and marco rubio is going to take those over at the at the state department. that's a big problem with the government. now, there's repetitive services. when you talk about a lot of the dea programs, it's already illegal to discriminate. every government agency has a personnel department. and when you created these de dea offices, you created all these new bureaucracies. so we want to look at the federal government. what agencies are duplicative, what agencies are creating repetitive services. and we're going to try to eliminate those but protect people. we want to protect workers from being

discriminated against. we want to feed countries in third world countries that that are suffering from famine. but we can do that without creating agency on top of agency, on top of agency, because the more agencies you have in the in the federal government, the less transparency you have. and we're coming off an administration, the biden administration, that i think will go down in history as the least transparent in history. so we're just trying to get our hands around some of this runaway spending, and hopefully we'll be able to make a difference. >> congressman, we will be watching closely. we appreciate you joining us today, and we look forward to speaking with you again after these hearings. thank you. >> thank you, thank you. >> all right disney just. >> reporting first quarter results. >> the company earning $1.76 a share. that was $0.31 better than expectations. revenue came in at $24.69 billion. that was just ahead of estimates. sports and experience revenue also topping what the street was expecting. but the entertainment revenue fell a little short.

disney's streaming business reported another quarter of profitability, despite a 1% decline in subscribers for disney plus. the company also reported that hulu paid subscribers of 50 came in at 53.6 million. that compares to the estimates of 52.9 million subscribers, and disney is affirming its guidance for the full year. as a result, you can see that stock up by about 2% right now. there have been questions in some sectors about the theme parks. they actually look like they did very well. and we will talk to the cfo, hugh johnson. he's going to be joining us at the top of the hour. we'll talk to him about what he's seeing in the results, what the consumer looks like, and more. on what's happening with the streaming wars right now. that's again coming up at the top of the hour. first on the top of the hour. first on cnbc -what've you got there, larry? -time machine. you gonna go back and see how the pyramids were built or something? nope. 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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>> coming up, alphabet and apple shares under pressure this morning. we'll talk to an analyst about alphabet's earnings and the reports of a potential apple probe in china. squawk box will be right back. >> the most. >> challenging engineering project in the history of the human race is our nation. >> golf has never been closer to the heart of this country. straight down exists thanks to american manufacturing and the movement to celebrate all things american made. >> we love. >> this. >> game. >> and we love this country. >> join us on. >> join us on. >> this ok guys, instead of getting weathertech, i saved a few bucks and got some cheap, foreign made floor mats. but they really stink, so put these on. ♪♪ really, gary? mom, i'm thirsty. don't settle for cheap, stinky floor mats.

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>> spending and. what the prospects. >> are for ai right now. >> good morning. good to see you. >> i think the market. >> is a little. >> bit concerned in the. >> near term on. >> the. >> capex increase. >> but when. >> i step back and think. >> about what's going. >> on here. >> the cloud. >> business, which. as you note. >> missed a little bit, their. >> capacity constrained. >> and really the. >> most important. >> thing in my view is that they're. >> executing well. >> in search. >> you're seeing good. >> monetization within. >> ai overviews. they're continuing to evolve. >> the experience. when we speak. to advertisers, they really like. >> a lot of the benefits that. >> they're seeing. >> from generative ai. and so you put it together. you have search. >> it's healthy. >> youtube i think has good. >> growth prospects. >> cloud at. >> 30% growth remains attractive. >> and so. >> i. >> think the investments make. >> sense from. >> a longer term. >> strategic perspective. >> i think. >> the. >> company remains well positioned and i think the. stock is attractive at current levels. >> that's interesting. you say that they're strong in search because a lot of what we hear from experts right now is that

google's search is being made obsolete by ai, that when you do search things, more and more people are just going straight to their ai apps to do searches. so. so how are they strong. there? and why are we seeing ads? >> so much. >> ad spending going to a business model that's. >> quickly becoming obsolete? >> i think. >> the money is going there. >> from advertisers. because it drives. >> an. >> attractive return. >> on their. >> investment, and that is. >> why they continue. >> to spend. >> i think the competitive landscape is fluid. >> clearly. >> there's competition. >> from a variety. >> of both. >> established platforms. >> and the. >> and the startups. >> but what we're seeing from. >> google, similar to the transition. to mobile. >> several years ago. >> is that. >> they. >> have the. >> intellectual property. >> they have data. >> they have models. they have the. >> balance sheet to invest. >> and they're. >> evolving the experience. >> the younger. >> users. >> which are particularly. >> important. >> are seeing a lot of. >> value from. >> ai overviews. >> circle to. >> search is. >> another example.

>> and so. >> the search market. >> is. >> growing. >> which is. >> very important. >> and google i think can. can grow and continue. >> to evolve. >> its experience. >> and so i actually. >> think search is a very attractive market. and i continue to think they're well positioned. >> yeah. >> we see those shares down about 7% premarket. apple also down. there's that news i don't know if you saw it this morning dan about the chinese government launching an. investigation into the app store. >> what should. >> we make of that? >> i think it's. >> a continuation of investigations. >> and probes. >> that. >> we've seen around. >> the world. >> around the. >> app store. >> i think. >> you'll see. >> a. >> continuation of. >> additional payment methods. >> that apple. >> and google. >> play. >> for that matter, will. allow in. >> their stores. >> i think. >> the. alternative stores will. continue to evolve. >> what's important, though, as. >> an apple. >> shareholder. and when i think about the. >> apple ecosystem. >> it's incredibly vibrant. >> and so even with this.

>> probe in. >> china, we'll have to see how. >> that. >> plays out. the installed base for. >> iphone is. >> growing in markets where they've. >> rolled. >> out apple intelligence. >> they're seeing. >> solid demand. >> for iphone. >> and so. >> you. >> take the. >> iphone franchise, which. in my view is durable services. >> i think. >> you'll. >> see strong growth. >> i think. >> that will. >> lead to. >> to. >> better growth. >> for the. >> overall company. >> over the next. >> 12 months. >> and so i continue. >> to like. >> the name here. >> all right. those shares down about a little over 2.5%. >> this morning. dan thanks so. >> much for joining us. we appreciate it. >> thank you. >> it is 7 a.m. on the east coast and you are watching squawk box right here on cnbc. i'm becky quick along with mike santoli and robert frank. among our top stories this morning. americans may have to pay more for items that they that they buy from sheehan and temu after the us postal service says that it will temporarily stop accepting packages from china and hong kong. that move, coming

after the trump administration slapped new tariffs on chinese goods and also revoked an exemption that used to allow packages worth less than $800 to be shipped to duty free. walmart is eliminating hundreds of jobs and asking workers to move to central offices in arkansas and california. the retailer is asking some staffers in new jersey and other smaller offices to relocate, according to a memo that was seen by reuters. and the treasury department says that elon musk and his department of government efficiency have not rejected payments for things like social security and medicare as a part of its review of that department. the treasury also adding that musk aides have only been given limited access to its systems as part of the review. read only is what they're saying not right, right over, or allowed to change or decide on any of these sort of payments? senators elizabeth warren and ron wyden, the top democrats overseeing the treasury, are asking the government accountability office to open a probe into the administration's decision to give musk access to

that system. >> all right. uber just out with quarterly results. the ride sharing company reporting earnings of 321 per share. revenue coming in at $11.96 billion. that topped estimates of 11.77 billion. adjusted ebitda of 1.84 billion. that's in line with consensus. uber reporting mobility and delivery revenue that topped estimates as well. looking ahead to the first quarter, uber sees adjusted ebitda in the range of $1.79, or 1.79 billion, to 1.89 billion. that's against estimates of 1.85. so the consensus is right in the middle there. uber ceo dara khosrowshahi will be joining squawk later this morning. >> all right. let's get a check on the futures this morning. we are continuing to see some red arrows. although the dow has pared its losses. it's now down by about 35 points. s&p futures are off by about 26. and the nasdaq it's where we've seen most of the damage. it's

indicated off by about 175 points. let's get over to dom chu. he's been taking a look at the market's biggest pre-market movers. and dom what's on your radar this morning. >> all right so becky robert, mike us listed shares of novo nordisk are climbing roughly about 3.5% after the danish pharmaceutical giant reported better than expected earnings and soaring demand for its wegovy obesity drugs. those sales are increased by 107% compared to last year, but we're actually slightly below analyst estimates. now, investors were pleased the shares up about 4% or so. so keep an eye on that. now for more on the quarter. more color and context. tune in next hour for a squawk box interview with novo nordisk ceo lars jorgensen. it's going to be a must watch there on the state of glp one drugs, and we'll end it out with shares of snap. they're down roughly 2.5% despite earnings, revenue and daily active users all beating consensus estimates. shares were up as much as, say, about 12% in after hours trading yesterday morning. analysts at morgan stanley are now downgrading the stock to an equal weight from an

overweight rating, saying that the app's redesign is taking longer and ad revenue remains stubbornly below industry levels. so snap share is just about flat on the session. for that and other top analyst calls of the day, just head over to cnbc.com. slash pro subscribers get full access to detail and analysis guys behind all of those big calls and stories becky, snap a lot of volatility. i'll send things back over to you guys. >> oh snap don thank you. good to see you. we'll see you in a little bit. >> ferrari shares. >> racing higher. >> yesterday up. >> 7% on that. earnings and sales beat. it's selling more expensive models like the new f 80. >> that cost. >> $3 million per car. >> and it's making. more per car. >> from personalization. and customized. >> paint colors or. >> customized seat leathers. ferrari is now worth more than ford. >> and gm combined, with a market cap. >> of $87 billion. now, the cheapest ferrari starts at around $350,000, so even a 10% tariff could be big, the ceo telling cnbc yesterday.

>> they are waiting for the actual. >> policy to determine. >> the impact. >> we are trying to understand what is going to be the percentage and when is the starting date in ferrari? you know, we have ferrari, we have the dealer, we have the client. we'll see how to manage. we will not we do not want to impact only one of the three players. we will manage. let's wait. when this is becoming a fact. >> ferrari owners, they can afford it. so unlikely. >> to be. >> a big impact. >> but on a dollar basis, that's. >> going to. >> be significant. the good thing is that ferraris are not very large in the cpi inflation basket, so i don't think it's going to. >> that's true. >> that's true. >> it won't move the fed. it reminds me almost of apple services though where you know you get them with the car and it's all the customization that you really set them up with 100%. that's right. >> yeah. nobody would be seeing you know, just. >> riding around the. >> base model. >> come on. >> all right. coming up disney reporting quarterly results a short time ago. the stock right now reacting positively up about

1.5%. it was a beat on the bottom line disney cfo hugh johnson joins us next to break down the quarter. and later financial services committee chair french hill will talk crypto regulation d banking and elon musk's access to treasuries payment system. we'll be right back. >> this cnbc program is >> this cnbc program is sponsored by b (vo) what does it mean to be rich? maybe rich is less about reaching a magic number... and more about discovering magic. >> i decided to go with rope or glp one, because. dealing with

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before deciding whether to pass on the added cost to customers. mattel sources about 40% of its products from china. stock up about 4% or 14%. excuse me, and we are ready with our disney reaction. >> we are. we've been looking through the numbers on this disney out with its earnings just in the last 10 or 15 minutes. been taking a look at that. and the stock is indicated higher this morning after the release of those numbers, the entertainment giant reporting better than expected earnings and revenue. actually, it looks like it's indicated down by about 6/10 of a percent. i've seen it up by as much as 2.5% over the course of the morning. joining us right now first on cnbc is disney cfo hugh johnston. >> and hugh. >> good morning. always great to see you but especially on an earnings morning. so thanks for being here today. >> yeah. >> happy to be here with. >> you becky. >> obviously feel great about. >> the quarter. >> well in excess. >> of expectations and most importantly broad based growth.

the entertainment business came in very strongly on the back of moana two, as well. as mufasa. and the experiences business performed very. >> well in excess. >> of where we expected. >> despite the fact that. >> we were dealing with hurricanes and the start up costs. >> on a. >> ship. >> the business actually x. >> those costs. >> grew 6%. >> in the quarter. which was better, a little better. >> than we expected. >> so we. >> feel like we're off to a great. start to. >> the year. >> yeah. and i will tell you right now disney shares are up by about 1%. they have been bouncing around a bit this morning. for anybody who hasn't seen the numbers yet. they came in at $1.76 a share. that's up from a $1.22 a year ago and compares to $1.45 that the street was looking for this most current quarter. let's start with the experiences, hugh, because there had been some questions about whether the park was going to feel pressure from either consumer spending or from inflationary costs. you point out that experience is which includes the parks and cruises, did have to deal with some hurricane activity and that cut into things. but where did

things come down just in terms of overall, i know you've been looking for that division to grow by 6 to 8% for the operating income for the fiscal year. >> yeah, that's exactly right. so it. >> came in, as i said. >> a. >> bit ahead of our expectations. >> we knew that we were going to see a build across the year. driven by some timing on, on. >> some. >> factors in the previous year. and in fact, the consumer. is a bit stronger than, than we would have expected. you know, broadly with the consumer. >> these. >> days, i think what we're seeing is consumers. are just very value focused. >> and if. >> you. >> deliver value to them, they're willing to. pay the price for it. and obviously a disney vacation is great value. >> so experiences. >> came in well in the domestic parks internationally with paris grew quite strongly. and the cruise ships continue to perform well. so really across the board in experiences, we saw more strength from the consumer than than. >> frankly, we. >> had expected. >> i think the other surprise was, even though you raised prices for your streaming costs

when it came to disney plus, espn plus, hulu, you didn't see as many consumers drop the service as you had expected internally. what happened there? >> yeah. >> same same basic story. >> you know. it's funny. disney plus just continues to be a stronger and stronger service. the bundle with hulu is working quite well. as you know. in december we added the espn tile. and that's off to a great start. and obviously espn flagship, which will be a really terrific espn digital product, will be coming sometime early this fall. so i think consumers are looking at it and saying, this is really a platform that that we need. >> to have. >> in our, our household. it's kind of a must have service. so despite the pricing, we think we're delivering enough value there. as well as consumers want to stick with us. >> although, hugh, the guidance is for perhaps a downtick in subs for the current quarter. because of that, that increase in expected churn, i gather, and just more broadly on the streaming strategy, do you think

that there's kind of the potential for consumer confusion? what's your vision down the road? having the multiple services, where some of them are, are all bundled, and yet they also can operate independently? where is that headed? >> yeah. >> i think you're. >> going to see us. >> make the product more and more focused over time. i think that. >> your. >> observation is very much a fair one, that there are oftentimes there are so many options. it does lead to a bit of consumer confusion. so the direction of travel we're heading in is how do we make this as easy and as simple as possible for consumers, particularly to bundle, because we think that's where the best value is, and that's where they can. capture the broadest array of entertainment that we offer. >> the way to think. >> about disney+ in the future, i think more than anything, is it's going to be the portal into all things disney and something you're really going to want to turn on 24 hours a day, seven days a week, when you're not watching cnbc, of course. >> but beyond. >> that, we certainly feel like it delivers entertainment, it delivers news, it delivers

sports, and in the future may deliver many other things as well. so i. >> think you're right. >> we're going to be simplifying the service to just make it easier for consumers and make them want to do the broadest possible bundle. >> simplify, meaning they're all going to get combined. and, you know, it's no longer a bundle. i think so, yeah. >> that's it. >> i think. >> you'll. see less rather. >> than more. >> options in that regard. because that's what consumers are indicating to us. they want they want less confusion. >> and where will the pricing be for something like that? >> well. >> right now i think we've got pricing that's going to. be in place probably for the next 12 months. >> i expect. >> this is a product that will continue to increase in price gradually over, over the course of a number of years. and then obviously espn flagship, which is a much bigger and broader product, will bring its own separate pricing attached to it. but i think you'll see pricing steadily increase, not not dramatically increase. >> you know, the profit line for disney plus, hulu and espn was

293 million. that was up from a loss of 138 million a year ago. and it's more than $100 million greater than the profit that the street was expecting. so what happened? what were the levers that worked there? >> well, it was a. >> couple of things. and if you think about where we were just a few short years ago when we were investing in building the business, you know, the business was losing several billion dollars a year. now, this year, our expectation is for it to make more than $1 billion. it's a combination of we've made the product better in terms of recommendation engines and all of those things that make it easier to use. in addition to that, because we're adding such terrific content both on the movie side with with the aforementioned movies as well as terrific content like shogun and abbott elementary and high potential, it's a more compelling proposition. so the churn is going down and the stickiness is a little bit higher than what we had expected. and that and on top of

that, we found the right balance in terms of the level of investment that we need to put into content. so from that perspective, we have cost, i think, in a better situation. so you add all of that up. it's turned from a business where we need to invest in to a business where we're going to continue to invest, but at the same time, we'll continue to drive the margins that we'd indicated earlier and grow subs simultaneously. >> how do you know that you continue to get the content right? i mean, it's great when the content that you're producing are hits and that there are things that really want to drive people in, but the way that subscribers can drop with these things, if you don't have a constant stream of new and exciting programing, i mean, that's the issue. how do you how do you know you've conquered that, that formula? >> yeah, i. >> think one of. it's actually one of the advantages, so to speak, that that the walt disney company has is we create some so much of our own content relative to, to perhaps some of our competitors. and that's based on all of the investments that we've made over the years in ip

like pixar and lucasfilm's and obviously the disney franchises. so by virtue of us creating 4 or 5 big tentpole movies a year, and then on top of that, smaller movies, by virtue of the fact that we're connected to abc. so we actually can produce programing that both runs on linear and runs on on streaming. we actually, i think, have a better feel for what we need in terms of content that perhaps someone might be who has to license more of their content. >> and hugh, you just mentioned linear. you know, that was down 7% in the quarter. >> we've seen. >> discovery warner, warner discovery. >> looking at. maybe sort of splitting off the. >> cable networks. obviously we. >> have spinco. >> with our. >> parent company comcast. >> what are your thoughts right now? what are the company's thoughts. >> for the. >> linear side and what. >> structures might. work for. >> the linear business? >> yeah. >> great question. we're very happy with where we are right now. and i think part of the

reason we're happy with it is because we do have this integration between what we're doing on the streaming side and what we're doing on the linear side. in a sense, we've really created a perfect hedge. if consumers want to stay in linear, we're perfectly happy with that. if they want to move over to the streaming side of how they receive their programing because of the incremental margins per subscriber on on streaming are quite high. it's almost like a software business in a lot of ways. we're happy if they move. so we've actually kind of positioned ourselves quite well, and we think that integration works well for us. now, i know those other companies are following different strategies and those are probably things that work for them. but given the size of our streaming business, we actually think what we've built right now is, is well hedged and therefore gives us the best outcome. >> hugh, thank you for joining us this morning. it's really good to see you. >> great to. >> be with you guys. >> take care hugh johnston. >> all right. >> coming up, three stocks. >> that you might want. >> to watch to. consider for.

>> your portfolio. and later the art of the trade deal rockefeller international. chairman and breakout capital founder and cio. >> ruchir sharma joins us squawk box. >> we'll be right back. >> time now for today's aflac trivia question. what professional baseball player was born on this day in 1934? the born on this day in 1934? the answer when squawk box prime, it's me. i mean, you. wake up, come on man! you gotta tell employers to take another look at all the benefits they're offering. everybody wants to build the best team and offering aflac can help attract and retain that top talent. you know we like that top talent. and listen, i mean you gotta listen. aflac gives employees cash to help with unexpected medical bills. it's prime time to add aflac. request a call today at aflac.com/prime at&t has a new guarantee. because most things in business are not guaranteed. like a distraction-free work environment. -yeah,i'll circle back around. -get those steps in, kevin. your coworkers keeping things confidential.

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investor. >> go pro with a flash sale offer for a limited time at cnbc.com. slash pro flash terms and restrictions apply. and now the answer to today's aflac trivia question what professional baseball player was born on this day in 1934? the answer hank aaron. >> welcome back. >> to squawk box. >> chipotle executives. >> shaking off tariff. >> fears during the company's conference call. >> last night, saying. >> they don't expect. >> costs to rise. much even if there are tariffs on imported ingredients going into effect next month. noting that only about half of its avocados this is surprising come from mexico. >> because i think 90%. >> of all avocados. >> in the us come. >> from mexico, so that's interesting. if tariffs aimed at mexico do go into effect, chipotle expects that its cost of sales would rise about 60 basis points or 0.6 percentage points. so not much. >> i don't know where they're getting there. >> it must be california, california or maybe. >> other countries.

>> yeah, yeah. all right. when we come back. financial services committee chair french hill will join us to talk crypto regulation d banking and elon musk's access to treasuries payment system. right now though, as we head to break, let's check out bitcoin this morning. it's barely budged $98,643 is the latest tick. $98,643 is the latest tick. squawk help us retire. it's a simple ask of our elected leaders. but the tax treatment we rely on to grow our 401(k)s, iras, and other retirement plans could be on the chopping block in congress. any policymaker who makes it harder to save for retirement is standing against the financial well-being of 120 million americans. it's time to prioritize our retirement savings. learn more at help us retire dot org. help us retire is sponsored by the investment company institute, representing asset managers serving individual investors.

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economy and interest rates, employment numbers anddy asked .

>> a budget reminder. >> smart buy. >> got it, got it. >> boss otter, you got this. >> let's get to markets and some squawk picks. joining us now dcla managing partner sara. good to see you. >> good to. >> be here. >> thank you for having me. really quick. i mean, the i think the cliche is it's actually now a stock pickers market. does it feel that way to you? >> it does. >> it feels a lot more just because if you look at the index that we've talked about this at length, you know, ten stocks etc, but you go below and you pull back the curtain. there are a lot of companies out there that haven't done anything in the last 2 to 5 years. you know, and if you take an example, you know, a j&j has been flat. yeah. it trades at 14 times earnings. it's got 5 to 7% earnings growth with a 3% dividend yield. you know you're looking at a 10% grower if the multiple stays where it is at 14. >> i mean there's been there's been reasons for those companies

like a johnson and johnson with some of the litigation that was overhanging. >> so you've got. >> the talc overhang. >> right, which. >> we hope by the end of this year is done because it's been a couple of years. >> and we all. >> know most. majority of the time when that overhang goes that multiple starts expanding. >> or even if. it doesn't. >> and stays at 14, you're still going to get a 10% growth with a triple-a balance sheet, right? so you've got and you've got m&a activity now that you can have that you didn't have in the last administration. so i kind. >> of. >> look at the margin of safety, strong balance sheet potential overhang a catalyst. >> and then you know where do. >> we want to go from there. yeah i mean the market's only wanted lily basically among the us firms. so we'll see if that changes. >> so it. >> was well it's that bifurcation in tech right. yeah. we only want. ai stocks. so hey if you. >> want. >> to play i look at a workday. yeah i'm just going to say that that one's moving this morning on a restructuring plan. well that's the interesting our thesis on that is the margins were at 27%. the goal is to get to 30. well, one of the ways you do it is to cut people. so they just announced this morning that they're cutting it in half percent. now that's one way to do it. the other way is to also

grow into it, which we think workday is going to do. they've got a huge addressable market. >> international is growth. >> that's erp software for human resources and financial systems. and the potential there is that's where you can use an ai, right? that's where you can use data. >> management and you can. >> use all the analytics on there. so there's a company we think that has a big, big. >> you know, long. >> runway ahead of it is the perceived risk that somehow i can let you kind of leapfrog those entrenched providers of something like a workday services. well, it would be. but the thing is, you need the data first, and. workday has the data. it's like oracle workday. it's very hard for companies to say, as we all know. whenever a company does an erp movement, probably don't want to touch the stock for two two quarters. so a lot of them stay with there. and then if the information is there, it's just application software. and then companies like workday can charge more for it. and the higher margins recurring revenue. so that's it. but and if the application is there then the incumbents are hard to do because you've got to

get the data on that. thermo fisher is a name you like. this is one that's been the story has been a little bit dislocated for a while. it used to be this massive kind of, you know, melt up type of name. everyone loved the model. what's happening now? >> so covid. >> came stock, went. >> through the roof. >> and then of course, after covid fell off. >> it's the. >> premier life science. diagnostic company. >> it's all. >> you go there for everything. and really, in the last couple of years, nothing was going on. you didn't have anything about like lab equipment. exactly. tools and all the tools that you need to do the research on biologicals to do more research and medical, you know, the whole industry. and really so the companies now. on the offense, it's going to do acquisitions. it's an acquisition machine. it's growing double digits. and really, it doesn't matter whether it's novo or lilly or j&j, it will win no matter what. and it's not dependent on china. only 8% of its revenues are in china. so that's another thing. you want to be careful going into it. it doesn't mean you

have to avoid it. it also means you can have a lot more volatility with some stocks that have more exposure. so again, beneath the big market there are opportunities out there. it doesn't mean you don't have. >> to own the. >> big boys. but you can own a lot of these other companies. solid balance sheets growers. and then you have margin of safety along. >> with it. what makes them attractive now? why now versus over the last 3 or 4 years. >> well thermo just because it had the covid bump and kind of came and sold off. you also have in the in these places these companies can do acquisitions now which we really didn't do. so i find that attractive with solid balance sheets. they don't they're not dependent on the credit markets. so you want that as well. so if rates move up or down it's not of any. >> do you do the next derivative down and look for the companies they might be acquiring and say those would be attractive. >> i will. >> tell you in doing this for 25 plus years, i've. >> never been right on those. >> right. because if you think so, company's going to get acquired and it doesn't. and they have something because sometimes those premiums are built in already, especially if the rumors are going right. so i

really like to be with the leaders that are going to integrate them. and look, if it happens and a company gets taken out, great. but but you know, that's a that's a very different. >> game to play there. >> obviously we got a lot of, you know, sort of pinball with the earnings reactions we're looking at this morning i mean uber it looks like it's going to back off. is this one that you've tracked for a while. we've owned it for a while. we sold half our position last year. then the stock went down to the 60s. so we said okay let's back off. i mean it's a great company. it'll be interesting to see. i haven't i haven't seen what they've said. but you know it's cash flow positive. there's growth there. the fear is always can you know the autonomous driving come there. >> so i. >> do like it. it'll be interesting to see. but i think them and lyft but they're the premier player in this area. so they've got international growth as well. it's always wild to say this like $160 billion company is going to trade up or down a few percent in a given day, because maybe down the road there's going to be a fleet of tesla. >> it's amazing. >> how that information can move an uber. and an uber is one of

those stocks in your portfolio that's high beta. so you're not going to get a 2 or 3% move on earnings anyway. it's normally one of these will go up 510 or down and it'll settle in. and it's had a lot of different investors in it. it went from momentum investors to value investors to now where are we actually. so you have to watch that. it kind of did nothing for years. yeah. yeah. so thanks a lot. good to see you. >> thank you. >> all right. >> coming up, ruchir. >> sharma of. >> rockefeller international on. >> the trump tariff. battle and why the world won't wait for a deal with the us. >> and we are counting. >> down to private. >> should be private payroll. data from adp. >> the numbers will hit at 815. >> full market reaction. >> is straight ahead. >> squawk box will. >> be. >> right back. >> squawk box is sponsored by wisdomtree. welcome to the future of investing.

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>> oh, rise. >> mushroom coffee. drink it cold. >> or hot. like neil. >> invest with an advantage with cnbc pro. >> cnbc pro gives you the tools that you need to become a better investor. >> go pro with a flash sale offer for a limited time at cnbc.com. slash pro flash terms and restrictions apply. >> president trump's crypto. >> czar david. >> sacks, along with house and senate financial. >> leaders, have announced the formation of a bicameral. >> working group. >> that will focus on advancing crypto legislation. joining us. >> now. >> house financial services committee chairman, french hill. >> congressman, thanks so much for. >> joining us. we appreciate it. so there's been a lot. of hyperbole. >> and questions. >> around what exactly. doge is

doing, what power they have, what authority they have, what whether they're. actually cutting off funding or whether they just say they're. >> cutting off funding. >> what is your take. >> right now. >> on what doge is doing and what authority they have or should have? >> well. >> i think. >> elon musk. >> and doge are. >> looking for government efficiency and all the cabinet agencies and across the government. this is at the direction. of president trump. i think it's a good idea. as i've said many times before. after years and years of building up government and government spending, it deserves to have a good, fresh outside look. with that said, anything. >> that reflects. >> something that. >> takes statutory. >> approval, of course, congress has to be involved in, but we expect doge to. give good recommendations to the congress on things that require statutory work. and if things can be done by executive action as opposed to how they. >> determine what. >> contractors are in the agency or whether they need buildings or leases, or have a way to upgrade. >> their it system.

>> i think that's perfectly appropriate for the executive branch to do internally. >> yeah. >> you mentioned that he's there to. >> suggest things, but he. >> tweeted or axed, i guess on monday. he said we spent the weekend feeding usaid into the wood chipper, and he's. >> taking polls. >> on x. >> saying. >> should we go after the irs next? it does seem at least. >> he's giving himself credit for actually. >> stopping funding. >> for these programs. >> well. >> we've got. >> some big personalities out there working on doge, and certainly. >> but. >> look, marco rubio, the secretary of state, former chairman of the senate intelligence committee, someone who's a skilled foreign relations person understands that aid needs a. strong look. as president reagan warned us many, many years ago. there's nothing closer to eternal life than a temporary government program. and usaid was created by executive order back in the 1960s, and it's now 10,000 employees and an enormous scope.

and i think president trump and marco rubio are saying, let's see exactly what it does, how it exactly spends money. is it in the interest of the united states, the contracting basis, the work it does, is it really out saving lives and providing badly needed services? and we know that they are. and our chairman, brian mast of the house foreign affairs committee is on that job, too. so i believe that. while mr. musk can take credit for that. you still have secretary rubio as to whom the usaid organization reports, and he's responsible for the reform and any direction that it needs to be, whatever direction needs to be taken and what changes need to be reported to congress if we need statutory changes. >> chairman hill, just to go back to usaid, because we've had a few people talk about this this morning, how it was created by executive order. it was by kennedy back in the 1960s. but the liberal bastion that is the wall street journal editorial page has said that this is congress's domain, and congress

is only pointing back that in 1998, congress enacted the law establishing it as a distinct entity. how do you read that? because this is going to be played out through the courts, i would imagine. well. >> i think it's technically reports to the international assistance organization inside states, and it's been suggested that it report directly to secretary rubio now, which i think is still within the state jurisdiction. and if they want to change spending or direction in spending. and some of that was done by appropriations, then they'll come and make those recommendations and this appropriations bill. but how they want to change those priorities, if they have discretion on how those grants are awarded to contractees and different areas under a broad direction by congress, then that's an area where i think marco rubio could take a decision that we're going to continue this kind of spending and discontinue this other approach. and that's all within the confines of how that agency

operates. >> and going. >> back to. >> crypto, chairman hill, what legislation. >> or. >> what regulation do you think is needed. >> right now? >> i mean, if you look at the crypto markets, bitcoin is soaring. the overall. market cap of crypto right now is over $3 trillion. >> there is something. >> like 172,000 crypto millionaires in the world. there isn't any evidence, at least clear evidence that. >> the crypto market has been. >> choked off by excessive regulation in the u.s. you look at the bitcoin etf. >> market that's flourishing. >> so what. exactly would regulation do that currently, investors in crypto. can't do? >> well, i mean. >> what you say. >> there is just, you know, not not true. the reason we have an exchange traded product in bitcoin, for example, is because people went to federal court to compel the sec to do it because their arguments in court blocking it for years were

incorrect. and so we have the courts to thank for gary gensler's bad regulation by enforcement. >> yeah, but. >> he's gone now. >> so he's gone now. >> yeah. he's gone. sure, sure. >> okay. >> well. >> look. >> he's gone. that's true. but that doesn't change the fact that crypto has been under assault by the sec over the past four years. and so the reason for legislation is to have a regulatory clarity that directs the sec and the cftc exactly what they need to do to protect investors, encourage innovation, encourage companies to use blockchain. and that's what we're going to do. we're going to pass regulatory clarity. and i was so pleased yesterday that david saxe representing president trump, my friend tim scott, chairman of the banking committee, g.t. thompson, chairman of the house ag committee, and john bozeman, chairman of the senate committee. we all came together yesterday to talk about our priorities, to move regulatory clarity for digital assets in the us so that we can have fintech and digital assets, be a premier area of innovation and technological advance right here

in the us, instead of what gary gensler left us with, was people moving out of the united states, moving offices to london, to the eu, to the middle east to work on blockchain programs. that's not the right way to operate. and regulation by enforcement is a bad way to go. we should ask that they use an open process through the federal register to propose new rules, which gary gensler did not do, and to work with congress to make sure that we have clarity for innovators up and down the capital formation arena. >> yeah. >> and one of the concerns about. crypto has been that it's used for. tax evasion. >> and i. >> think that the regulation starts this year, where the crypto exchanges will be required. >> to file. the 1099 forms with. >> the irs. >> so there will be more transparency of. what people have and are trading on crypto exchanges. do you still support that regulatory. regulatory change. >> and do you think. that that will. come under fire. >> in. >> this, whatever they design as

new regulation? >> well. >> a digital asset a crypto asset is an asset and therefore it needs to have clear and clear rules and clarity around what the tax obligations are for capital gains purposes, ordinary income. and so i think when we look at the extension of the tax cuts and jobs act during 2025, we ought to make sure that we have digital assets taxed in the right way, just like we do any other asset class. but i think between having a dollar backed stablecoin legislation here in the united states for clear rules of the road, of how that payment system could work, as well as, as i say, rules for the sec and the cftc will bring innovation and investment back to the united states and will make sure that we're leading in this fintech niche in innovation across the country and the world. >> all right. >> chairman hill, thanks so. >> much for joining us. >> we appreciate it. >> you bet. good to be with you. thanks. >> all right. when we come back, why ruchir sharma says that the world will move on to trade

without the us. he's going to join us right after this. check out the futures this morning. you'll see. right now we're still in the red. dow futures off by about 46 points s&p futures down by 25. the nasdaq futures down by 25. the nasdaq down by 165. squawk box will be -honey... -but the gains are pumping! dad, is mommy a "finance bro?" she switched careers to make money for your weddings. oooh the asian market is blowing up! hey who wants shots, huh?! -shots?? -of milk. the right money moves aren't as aggressive as you think.

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in the average household, there are dozens of connected devices. connectivity is a big part of my boys' lives. it brings people together in meaningful ways. are right for you. start today at forhours. com. >> all right welcome. >> back everybody. volatility over tariff policy could be leaving the united states behind the rest of the globe. in his recent piece for the financial times, rockefeller international chairman ruchir sharma says the world is moving on to trade without the u.s. he joins us right now. ruchir is also the founder and ceo of breakout capital and the author of what went wrong with capitalism, which, by the way, is a huge defense of capitalism. ruchir, thank you for being with us this morning. what do you see that's happening in the world of trade that you think the us is being left behind? >> well. >> becky, this has been a trend that's been going on for the

last decade or so that. >> if you look at the ten. >> fastest growing. >> trade corridors in the. >> world, only. two of those involve. >> the. >> us now. >> and five. >> of those involve china. >> and china. >> has clearly become the. >> world's largest exporter, and. also its share of global manufacturing. >> is at a new high. >> so i think what's going on here is that countries are quietly nodding to what the us. wants when it's brought to the negotiating table, as. >> we saw. >> with. >> mexico and. canada a. >> couple of days ago. but beyond that, what they're doing is striking, striking trade deals with other countries because they still view trade as a very essential part of their ecosystem. so therefore, the us share in global trade has been declining over the past decade. it started off with trump's first term and continued through biden's term as well. because remember, he also carried on with the policies of tariffs against china and other countries. and now i think what we're going to see is that that

movement is only going to accelerate and gain further pace under trump's second term. so i think that this is something the us just needs to acknowledge and deal with that. yes. today it is the indispensable nation. it is runs the world's largest trade deficit. there are a lot of people selling into the us, but i think a lot of countries are quietly moving on, realizing that they just can't be that dependent on the us. this is happening on trade. this is happening even with bilateral payment systems of currencies. and that, i think, is eventually something that could come to hurt the us economy as well. >> you know, this is something that, look, it's a movement that both parties have embraced. when trump was elected back in 2016, he was running against hillary clinton, who was also opposed to tpp, the trans-pacific partnership. so wouldn't necessarily have mattered whether a democrat or a republican was in office. these are movements that have been populist, movements that have

really spread across the country. i think it's the feeling of workers who felt like they've been left behind that manufacturing jobs have left. so what's the country to do when that sentiment is so rife? when you look and feel like you're on the losing end of some of these things? and what do you think the longer term implications would be? >> right, becky? that so when i made the point that under biden, these policies continue, including the tariffs against china, but in terms of what has been the results over the last eight years of these policies, is something worth evaluating. and then also seeing about what else can be done to help increase us share and global manufacturing, if that's the ultimate aim. one thing which clearly doesn't help is a stronger dollar that that the us has had a very strong dollar over the last eight years. in fact, by some measures, the dollar today is the most expensive that it's ever been in its floating rate history, which goes back to the bretton woods

system ending in the early 1970s. so under that environment, the us is very uncompetitive, and that doesn't help its cause. and every time there is news of tariffs, the dollar only tends to depreciate, which is counterproductive. and something that's happened over the last eight years. so that's a very important policy tool. the us also needs to keep into account. and secondly, as i said, that even though tariffs have gone up, us share in global manufacturing over the last eight years, us share in global trade over the last eight years, all have come down. so this is not helping as yet. so i totally agree with you that the sentiment is that something needs to be done here because of the hollowing out that's happened in lots of america, because of so-called globalization. but the policy tools so far haven't helped. i think the one of the fundamental things that we don't acknowledge is that the us consumes too much and china produces too much. that is just a fundamental issue. and when the us runs a budget deficit, as we have

discussed for 6 to 7% of gdp, there's a result of that. you have a current account deficit because you're consuming too much of over 4% of gdp. and the china, on the other hand, is running massive trade surpluses. so the basic problem of the china producing far too much and us over consuming and running a very low savings rate, is an economic identity that is very hard to explain, but that's the reality that's driving these massive trade deficits. and also the dollar being so expensive makes the us very uncompetitive. >> but you just. >> mentioned over consumption. >> i mean, all of what you just said about the trade deficit is just a signal that the us. economy is extremely. >> strong. >> especially relative to the rest of the world. what evidence is. >> there that. >> the us, by not participating in all these trade. >> deals. >> is losing out economically. >> because right now the. >> us is the envy of the. >> world when it comes. >> to economic growth.

>> yes. so you're actually correct about that. and so therefore the us also, that also leads to some hubris and arrogance, right? when it comes to negotiations, because you think that the world needs you and so you can demand whatever you want from the world. well, the two negative consequences, as i said, one is that the us may look like the envy of the world, but remember, it's running a budget deficit of 6 to 7% of gdp, far higher than any other country. and that's what's also helping keep the us economy levitated. and the second thing, as i said, that these are very long term consequences. trump himself is concerned about the fact that nations are trying to create their own reserve currency or reduce the dependance on the dollar as a unit of exchange, something that also happened after the russian sanctions. now, remember that the us, to fund its massive budget deficit relies a lot on the rest of the world's savings. and so far, because of the ai boom, you've had a massive inflow of capital into the us, which has funded the huge budget

deficit and the resulting current account deficit. but if the rest of the world gets much more concerned about that, that will become difficult to do. and let's say that the world starts to move to alternative payment systems. and we have seen the rise of gold and even bitcoin for that matter, as sort of anti dollar plays that sort of will reduce the us ability to run these massive budget deficits and keep printing these very high growth rates. so these are the consequences that the us has to think of that the law of unintended consequences really. >> rogier. thank you. some deep thoughts on a pretty complicated subject matter. we appreciate your time. >> thanks, nick. >> coming up, the latest read on housing plus what financial regulatory changes may come under president trump. qed investors co-founder nigel morris joins us to talk ipos and the investing landscape. squawk box will be right back. >> we're mizuho. >> sound familiar? it should

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demand from. home buyers dropped 4%. >> compared with the previous week. >> that, according to. >> the. >> mortgage bankers. >> association's seasonally. >> adjusted index, demand was flat compared to the same week a year ago. >> the average rate on. >> the 30 year fixed. >> for conforming. >> loans decreased to 6.97 from 7.02. >> that's for loans. >> with 20% down. >> it was the lowest level in six weeks, but really not a huge move. >> we've seen. >> rates really not move from that 7%. applications to refinance. >> a home loan rose. >> 12% for the week. >> and were 17%. >> higher than. >> the year before. >> but the percentage. increases are big because. >> the fact is that the volumes. >> are just so low. you see these big percentages. >> now, most borrowers today. >> have rates well below. >> what is being. offered out there. >> but back to buyers. >> demand from. >> them is now. >> 39% lower. >> than it was. >> this time in. 2019 or pre-pandemic. >> home sales. >> are running at. >> about a. 30 year. >> low. >> while home prices. >> nationally continue. >> to. >> hit record highs. and in november. >> the annual. price gain on the s&p case-shiller.

>> price index. >> was bigger. >> than. >> it. >> was in october. so more sellers are. >> offering price cuts 15.6%. >> in january. >> up from. >> 14.7% of sellers in january of last year. >> that's according. >> to realtor.com. but that's still not a lot, and the supply of homes for sale is up. >> 25% from a year ago. >> new listings, though only up 11%. so a lot of that gain is that the. homes are sitting on the market longer. >> nobody's buying. >> the average time. >> to sell a home at. >> the end. >> of january was 54 days. >> that's the. >> longest since. >> march of 2020. >> when the pandemic was just hitting. >> that's according. >> to. >> redfin now. as a. >> comparison, supply. >> of homes. >> for sale. >> is still 25%. below where it was pre-pandemic. >> and this guys. >> as we're. >> going into the spring market. >> all right. >> diana olick, thanks. so much. a lot of that has to be because people have been waiting for mortgage rates to come down and they just haven't. so prices aren't coming down, even if they're sitting there and homebuyers and homeowners are bringing down their prices. it doesn't matter. all right. it is

8 a.m. on the east coast, and you are watching squawk box right here on cnbc. i'm becky quick along with mike santoli and robert frank. joe and andrew are off today. among today's top stories a potential casualty of new u.s. tariffs on china. bloomberg says that the country is looking into investigating apple and the fees that it charges local app developers. the report says regulators think those fees may be, in their words, unreasonably high for chinese app makers. shares of apple off by about 2.2% on this news. disney beating analysts first quarter profit and revenue estimates. the company saw disney+ subscriber losses because of price hikes, but fewer people actually dropped the streaming service than disney was expecting, and profitability was $100 million more for streaming than the street had been expecting. disney cfo hugh johnston joined us in the last hour. >> so i think consumers are looking at it and saying, this is really a platform that that we need to have in our

household. it's kind of a must have service. so despite the pricing, we think we're delivering enough value there as well as consumers want to stick with us. >> shares of google parent alphabet also falling in the premarket. the company missing analysts revenue expectations for the fourth quarter. google cloud revenue also came in light, and capex spending guidance of $75 billion for 2025 would represent 47% year over year growth. wall street was only looking for an 18%. increase in capex growth. that stock down by 7.25%. that's a big part of the problem with the nasdaq futures this morning, though. >> for sure. let's get to dom chu with a look at some more of this morning's premarket movers dom. >> hey good morning mike. good morning robert. good morning becky. well let's start with uber shares. they're down roughly about maybe 4% or so right now. that's despite reporting a beat on revenues for the quarter. earnings per share came in at $3.21. but that is not. well the question is whether it's comparable. right now it doesn't appear comparable to analyst estimates. there is

also a $6.4 billion benefit from a tax valuation release, which is adding to the comparability issue. so we'll keep an eye on that. but mobility delivery sales both beat estimates for the outlook for the current quarter. bookings fell short of consensus. so on balance what you have is a 4% drop in shares of uber technologies. meanwhile, harley-davidson shares are slipping after the motorcycle maker reported a big miss for the fourth quarter. they posted a loss of $0.93 a share, compared to estimates for a $0.60 a share loss $0.66 share loss. revenues fell 35% year over year. the company's ceo said that the high interest rate environment has impacted consumer confidence. shares have lost more than 20% of their value over the course of the past year. they're currently down 3% in the premarket trade, and we'll finish with capri holdings. those shares are down roughly 3% right now after the parent company of versace, jimmy choo and michael kors and other brands reported q3 results below expectations. total company retail sales declined in the low double digits, while wholesale revenues decreased in the low teens. capri ceo john idol said

the company is disappointed with those results. it's reevaluating its strategic initiatives to improve current sales trends. those shares have lost half their value over the course of the past year. remember, capri had been trying to merge with coach and kate spade parent company tapestry, but that deal was called off after it was blocked by the justice department in the biden administration. so mike capri holdings down about 2.75%. i'll send things back over to you guys. >> all right, tom, thank you. our next guest is here to talk about the markets, but also about the second trump administration's possible impact on fintech, the consumer and ipos. joining us now is nigel morris, co-founder and managing partner at venture capital firm qed investors and co-founder of capital one financial services. nigel, thanks for coming in. good morning. >> good morning. >> good morning. let's talk about this interplay of, you know, policy the markets ipos. it's interesting when you see how few ipos there have been relative to the size of the market. given s&p is up 20% two

years in a row. technology's been the leadership sector. is that because of anything going on with regulation? or is it just that the very largest companies have been where all the excitement and action has been? >> well, you're quite right that it's. been actually a paucity of. >> ipos in. >> in 2021. there were. >> 61 fintech ipos. >> and in the last three years cumulatively there's been six. so it's been. >> really not much happening there. >> the truth. >> is though, we have now a. whole generation. >> of fintechs. >> that are now preparing. for ipo. >> the number of. >> companies that have filed their. >> s1's. >> we have. >> klarna, we have. >> chime. >> we have. >> stripe that's very big, that. >> hasn't filed an s-1, i don't believe. >> but these entities. >> now are. >> very profitable. >> they pass. >> the rule of. >> 40 test. >> they're growing really well. they've got. >> grown up management teams. >> and i think. >> they're all waiting. >> now in. the wings. >> to. >> see how the. economy behaves. >> itself over these next. >> few days and weeks. of course, this. >> has. >> been incredibly. >> tumultuous the last. >> two weeks, but. >> i.

>> think we'll. see in. >> the first. quarter the market being tested by these generation. >> of fintechs. >> and i. >> would remark. that servicetitan went public. >> you know, 2 or 3 months. >> ago, and. >> their stock has. >> behaved very well. >> so that's a. >> good litmus test, i think, of how responsive the market will be. >> fintech is so interesting. i sometimes glibly say like either fintech doesn't exist or everything is fintech, like visa is fintech in some respects. jpmorgan's fintech. what do you mean when you suggest that that there's some separate subsector called fintech? >> you know. >> the way i think about. >> it, michael, is that. >> you've. >> got incumbents. >> the old traditional. >> banks, and then. >> you've got. >> these innovators. and in some. >> ways. >> capital one was, i think. >> the first generation. >> of breakout. >> fintech now 30 years. >> ago and then. >> followed by paypal. but if you look. >> at fintech. >> and this is a study that we've done with. >> the. boston consulting. >> group, fintech revenues. >> added up. >> worldwide represent. >> 320 billion. >> on a. >> base of.

>> 14 trillion. >> so fintech. >> as measured. >> by these. >> attackers, these. >> challengers represents. >> 3% of total. >> revenue in worldwide. >> so it's still. >> very, very early days. and i think we're seeing. >> as. >> i mentioned earlier, these. companies now. >> coming through. >> that. >> are real companies that. have real management teams. >> and are. >> real threats. >> to the incumbents. >> we have one of the more clear potential policy movements seems to be lighter regulation on those traditional banks. i mean, that's what the market has sort of celebrated in advance. does that change the competitive equation for these upstarts, or is it, you know, it's still going to be kind of open season. >> no, i think you're quite right. >> there's a. >> very much a pro growth. >> environment from. >> the regulatory front. >> we've seen. >> the cfpb. >> head move offstage and. >> treasury secretary. >> step into that role. >> and i think. we're seeing a. >> much. >> more benign. >> orientation in regard. >> to financial. >> service regulation. a ceo.

>> i was. >> talking to yesterday. >> said the gloves are now off in the deployment of. ai across. financial services. >> the cfpb. >> had certain reservations. >> about what you. >> could. do with ai, which. >> i think. >> by the way. >> is alchemy. >> that's magical. >> but we will. >> see, i think less friction. >> we'll see more inclusion. we'll see more. bank consolidation. >> i mean. >> we have. >> 4500 banks. >> and 4500. >> credit unions in this country, and. >> 8950 of them. >> are subscale. >> so we will see. >> that starting to come together. >> nigel, who benefits in this new world? is it the big get bigger and bigger because they can take the eye gloves off. they can deploy more capital towards that. they can buy smaller competitors. is it the new startups that are going to be able to run roughshod around that? like who wins in this? >> you know. >> certainly in. >> the. >> short and. >> medium term, my take is that it. >> is the. advantage fintechs. >> they're smaller. >> they're more. >> technologically adroit. >> and they. >> they can build.

>> these models out of the ground. >> really quickly. >> both in. terms of management of their costs. >> and writing code. >> the incumbents. will take longer. >> they will evaluate. >> ai, then. >> they will determine where. >> in the organization ai. >> will be managed, and. >> then they will have a. >> vendor list that they. that the organization. >> can buy. >> from, and then they will start experimenting. >> i saw a data. >> point. >> just the other. >> day that said 16%. >> of banks. >> in the us. >> are experimenting. >> with ai. >> virtually every one. >> of our. >> portfolio companies. >> we. >> have. over 100 active companies worldwide. >> at qed. >> virtually every one. >> of them. >> now is deploying ai. >> at. >> scale. >> and any, any. >> and any pitch that you hear from. >> any company. >> now starts with. >> here's how we're leveraging ai. >> but so are the big banks. i mean, they're not just playing with ai. they've been investing and playing with it and using it at large scale too. do they buy all of those startups, the fintech startups that are there? >> you know, it's been. >> this is this. >> has been an interesting phenomenon. >> how we've seen. >> more fintechs.

>> buying fintechs and. >> amalgamating them. >> than we've seen banks buying fintechs. >> and i think. >> there's a real schism occurring in the incumbents. where capital. >> one. >> jp morgan. city chase. amex fifth, third key off. >> the top of. >> my head. >> are very much. >> leaning in to. >> looking at the fintech. >> universe and. >> saying, what can. >> i buy. >> here where i've got. product market fit. >> i've got. clear unit. >> economics that make sense. >> it'll take me a long time to develop it myself. >> i will just. >> buy my way in. whereas i think the. >> vast majority. >> of the. >> 9000 banks and. >> credit unions. >> are. >> still focusing on. >> how do. >> i buy. >> things that look more like me and smushing them together? >> can all these companies just tap. >> the private credit market? i mean, when you. >> look at ipos. >> i understand why investors like you private equity, venture capital, they want exits. but these companies you look at the fundraises by the big ai companies in the private capital markets, which are now a $2 trillion market. >> we don't they don't need. >> to go public. >> they don't need ipos.

>> it's i think. >> that's exactly right. >> we've got. >> over the next two. >> days. >> i've got 15 of. >> my portfolio companies. >> off site. where we are putting. together an ipo readiness seminar. these are companies that over the next 2 or 3 years, if the window is open, could plausibly. >> go public. >> and a discussion there. >> is why would. >> you want to go public? >> here's some. >> of. >> the positives. >> everything. yeah we've got sarbanes-oxley. >> you've got your you've. >> got your. >> you're in a fishbowl. >> you are very focused. >> on short. >> term earnings management. >> and your board will. change dramatically. >> and the private. >> markets are. >> very. vibrant as you say. >> so i think that. >> you know, if we. >> talk to our investment banker friends, they'll always tell. >> you that it's a good. >> thing to. >> do to go public. and of course. >> liquidity is an important thing. >> and that's been a huge. >> issue in. venture and. >> private equity these. >> last three years. >> there has not been that liquidity. >> so it's very attractive. >> and you know in the capital one days going up there and ringing the bell is. >> a wonderful. >> milestone to enjoy. but the. >> trade offs. >> are more complex. >> and you should not

automatically. >> assume that you should go public. >> all right nigel, great perspective. appreciate the time today. >> thank you. >> very much. >> all right. >> all right. coming up adp private payroll data for january. that's coming up next. and later today. >> don't. >> miss uber ceo on squawk on the street. they break down the company's earnings squawk box. >> we'll be right back. >> this little. >> light of mine. >> in the world's. >> poorest places. >> children with cleft. >> conditions live in darkness. >> and shame. >> they are shunned. >> outcast. living in pain. >> you can reach. >> out and. >> change the life. >> of a suffering child. >> right now. call operation smile or go to operation smile. org. >> just $30 a month can help. >> volunteer surgeons and nurses. >> provide free. >> surgeries to. >> waiting children. >> you'll give a child a chance. >> to smile. >> to come out of the shadows and shine. please call now.

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>> available now. >> at graco. >> all right welcome back to squawk box everybody. we are approaching january's adp private payroll report. the futures ahead of that dow down by about 67 s&p futures down by 25. the nasdaq off by one. 60 steve liesman is here. and he joins us with that number. >> betsy thank you. the january adp private payrolls. estimated 183,000. >> this is the private payroll company adp. with its. >> estimate of national. >> private payrolls. >> and you can see their. >> goods not. >> doing so great. but it's. >> all in the service. >> sector 190,000. >> and there's the non-farm payroll estimate in and around exactly where adp is. >> at. >> 169,000 for this friday. >> they revised. >> up december. >> to one from 122. >> to 176. that's a little closer. >> to where the government was with the bls report.

>> and then pretty. >> good distribution across. business size here. >> 39,000 for. >> small business, 92,000 for medium. and 69,000 for. >> large business. >> and then pretty good spread. >> again across different. >> industries again, but all in the service sector trade. >> transport and utilities. >> up 56. >> leisure and hospitality up. >> 54,000 and education and health services down. sorry up 20,000 with professional. professional business services up 14,000. and there's manufacturing taking that a hit i'm not sure. >> exactly what's going. on there. maybe we'll ask. >> neil richardson in a second. >> key though. >> here these median annual wage changes. job stayers 4.7. >> that's steady. >> and job changes. up 6.8%. >> just very quickly. >> some headlines from tom. >> barker from the. >> richmond. >> fed this morning. >> he says. >> he still leans towards cuts. this year. expects 12 months of inflation. to come. down nicely. but he says there's a lot of uncertainty. he goes beyond. >> just tariffs to immigration regulation and other issues becky. >> all right. thanks stefan. you

called me betsy at the top. i've only known you 25 years, steve. you did. you called me betsy at the top. these guys heard it. i know she's your producer. they took him away. oh, now i feel bad. steve doesn't get to play back with me anyway. joining us right now is nela richardson. she is adp chief economist. nela, let's run through these numbers. what jumps out at you? what should we be really paying attention to. >> first of. >> all, hi, becky. i'll say it again. >> i think. >> we should first. >> of all underline the strength of the. labor market. now, remember the january report for adp and the numbers that you'll see friday from the government have been re benchmarked with a qck w number that it pulls the. numbers together. >> for january. >> and so what i think you'll see from both adp and on the friday report. is strength ending the second half of 2024. that carried over into the first

month of 2025. but as steve pointed out, you'll see that dichotomy between goods and producing and services. this is very much a labor market where hiring is led by consumer facing industries, namely leisure and hospitality. so we're going to be seeing if that carries over through the whole year 2025 or if manufacturing can have a chance to rebound this year. >> and nila, we have talked so much about how, you know, doge is in effect, the government is looking to try and cut back on spending, cut back on employees. they are offering buyouts to lots of people throughout the government offices. i know you focus on private payrolls. is there going to be a point where adp does not necessarily match up with what we can anticipate from the friday jobs report, because government numbers are going to be such a big factor in this. usually government is a is a plus and an upside to adding to those jobs reports. but we could see it really coming down in the weeks and months to come.

>> we've actually seen in the in the government numbers, not the government jobs but the government numbers, a turn towards the private sector, government and health care was carrying the bls report for a lot of the months over the summer and the fall. but if you look at the end of 2024, it was really the private sector that was taking off and accounting for the majority of the job gains. and i think you still see that momentum in january. so clearly, i think from for the first initial months of this year, it's really going to be private sector dominance. and that should be consistent between the two reports. >> okay. and if we were to look for any outliers throughout these numbers, what what surprised you, if anything? >> construction. we're still in need of residential construction. there's still powerful trends when it comes to data centers and fueling i. and that leads back into real estate. so i'm surprised to see

that construction jobs were so short, only 3000 this month. i really think it's tied to a labor shortage, not a shortage in demand. and so if we're going to see that support for housing and remember, becky, housing feeds into inflation. if we don't have enough housing supply then we really need to see more job gains in construction to support that industry. >> the median change in annual pay up 4.7% for job seekers, up 6.8% for job changers. that seems higher than some of the numbers i had seen recently. is that an indication of inflation potentially coming back? >> yes. so we've. >> seen that jobs data number not budge really from 4.7%. and new this month we actually increased our sample size by 5 million workers that we can. uniquely match through time. so that's a 14.8 million sample size. and so there's a lot of data that has a very rigorous underpinning to that 4.7% number

that we haven't seen a lot of movement in. and yes, that is much higher than it was. before for the pandemic. so wages are still elevated and there is reason to be cautious about the future moves of inflation, because wages are that bridge in terms of labor costs between the jobs market and inflation on the other side. so there's a right to be cautious here. >> okay, neela, thank you very much. great to see you. >> thanks for having me. >> all right. coming up, an interview you don't want to miss with the ceo of ozempic and maker novo nordisk on the company's latest results. stay tuned. you're watching squawk box on cnbc. >> here you go. >> is there any way to get a. >> better price. on this? >> have you checked singlecare? whenever my customers ask how to get a better price on their meds, i tell them about singlecare. it's a free app accepted at pharmacies nationwide. >> before i. >> pick. >> up my prescription, i. >> always check. >> the singlecare price. >> it's quick, easy. >> and totally. >> free to use. >> single care. can literally. >> beat my insurance co-pay.

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our cnbc health and pharma reporter angelica peebles. angelica. angelica. hey, becky. >> good morning. and lars, it's. >> nice to see you. >> thanks for joining. >> us on this. >> busy morning. now, this morning on. >> the call, you said that you're. >> seeing about. >> 200,000 weekly prescriptions for wegovy in the u.s, and that's double what you saw last year. but there's a lot of concern out there about your ability to stay. competitive with lilly. >> and if we're seeing a slowdown. >> so what are. >> you seeing and how. >> are you going to stay competitive against. >> that bound. >> well, we have a fantastic product. and i think so far what has really been gaining the market performance is the availability of supply. and of course, in the beginning of the year, you often see some formulary changes that also move the scripts a bit. so we are quite confident that as we move into the year and we'll be supplying more and more of our starter doses, we can see a nice step up in our volume and serving more and more patients, and the guidance we have given for this year. also, you can say, testifies to an underlying

significant ramp in our business. so we're quite confident both in the demand in the market and also our ability to supply and compete in that market. >> and i want to talk about the pipeline for a second, because it's been a rocky few months for you with some of the readouts that you've had. so between calgary sama and creighton, you know, how do you anticipate that you're going to stay ahead? >> and where. >> should we really be focused right now? >> yeah, i think we had the opportunity on our just completed conference call with analysts and investors to really explain that when you have a potent biology, like what we see with fema, it's important to understand that you actually amplify the difference across patients. so what we see is that there are a group of fast responders that really lose significant weight loss, actually more than 25% throughout the trial period here. and many of them are approaching a bmi where they're no longer obese. and then we see also a sub pool of patients that continuously keep losing weight and actually have not plateaued

at the end of the trial. so they need say longer treatment. so i'm very confident in the potency of the biology we have here. and we also showed some data that is actually very well tolerated from a gi side effects perspective. so is strong. and we'll do some more data to show that. and then we've also seen in a phase 1a2b study. so sorry 1b2a study really showing a very very nice weight loss. over 37 week trial period. and we hope that we in dialog with the agency, can find a way to move into full development of that relative shortly. so a real strong pipeline to compete with for the for the for the near term future. we've also just started phase one trial of tri agonist. so again, a next generation compound looking at

three biologics in one molecule. so i'm really excited about our opportunity to drive growth in this space. >> lars, i'm curious about. >> pricing, particularly in the us. if you look at the price. >> of your drugs. >> in the us versus. >> the rest of the world. >> they are. >> as is typical. >> much, much higher. but and typically health care and health care insurance plays a role in this. but look at the average price in the us is $969. in france it's $71. what do you see going forward on pricing, and could that have an impact on margin? >> well, i think it's important to note that here you're actually comparing apples and pears, so to say, because for instance, the german price is actually on a on a low dose, not the high dose. whereas in the us it's, it's pricing before rebates. so these are not a fair comparisons. what i see in the us is that pricing is coming down. it's typically seen across all categories that you launch at a, you know, relatively attractive price, but then you

give rebate concessions year over year and net price moves down. and for mature products, pricing in the us is actually a low compared to europe. so if you look at insulin, for instance, what government pay in the us is actually lower than what governments pay in europe. so it's a different market structure. but i think it's a known structure. and i think it works because we also bring products that drive down healthcare costs by serving some of the comorbidities. that actually leads to the highest part of the healthcare cost in a country like the us. >> and on pricing, of course, wegovy and ozempic were selected as part of this next round of. >> medicare price negotiations. >> you've been through. >> those. >> negotiations before. >> what did you learn from the first time around, and how do you anticipate. >> that this negotiation will actually change. >> the. >> price of those. >> two drugs? >> yeah, that's right. this was largely anticipated based on the success of these products in the market, making it one of the big

drug categories. so we had all along anticipated that. and as you say, we had a prior experience with our insulins. and overall i think we managed that quite well. it has changed a bit, say the gross to. net model for insulins instead of having a list price and rebates, you you you trade on a on a net price. so i think that a lot of learnings there. and if you look at our glp one business, of course it's only a, you know, a smaller part of our overall book of business that goes to the government, there's still a commercial channel. and of course, we also have the innovation we talk about. and there's still a very large volume opportunity. we are only serving today around 1.5 million people living with obesity in the us, and we have access to 55 million of those. so there is a volume and innovation play. that

also means that i believe we can we can handle the ira. and as long as you're innovative and you serve big, big markets and untapped opportunities, i think this this plays out to the benefit of patients, healthcare systems and also our shareholders. >> and have you had an. opportunity to speak to the new president or the new presumptive hhs secretary? and if. >> you haven't spoken. >> to them, if you were able to have that opportunity, what. >> would you. >> ask them? or what would your priorities be? >> so i have not had such an opportunity, but i have noticed that there are many similar objectives. as a company. we are investing significantly in the us. we have more than 10,000 employees. in the us. we have, you know, a number of expansion programs going on. just one announced a few months back is 4.1 billion capex program taking place in north carolina. i've also noticed that there's a key interest in in, say, health and

dealing with chronic diseases. that's, you know, the purpose of our company. so i think we have many overlapping objectives, and we are happy to engage with, with any policy maker in any country in how we can join forces in achieving these. what i would say win, win, win, win for, for the patient win for healthcare system because you forgo some of the comorbidities that are associated with chronic diseases, but also win for the economy in terms of increased economic activity level. and when you create all those win win wins for society, obviously we will also be winning as a company. so i think this is this is a really good topic to have a debate on. >> lars, thank you for joining us today. we appreciate it. angelika. thank you. thank you. rick santelli is standing by at the cme in chicago. he's got some breaking economic data. rick. the numbers please. >> yeah. and this is a date with history on this number. the trade balance for december -98.4

billion. -98.4 billion. that is the second largest trade deficit ever since we've been recording, which goes back to january of 1992. the biggest was 101.9 billion. that was in march of 22. that was the biggest and pre-covid, you know what the biggest deficit was pre-covid. the biggest deficit was -68 billion. 30 billion smaller than the current 98.4 billion. now we're not getting a huge reaction in the marketplace because this is one of those numbers where, you know, it just doesn't jump out at you, that you need to hit the market in a certain way. what it tells me is that the globe's behavior has been modified, that deglobalization is showing up, that the us is the biggest, strongest economy in the world is showing up in these numbers. so there's many ways to take it. but the way i take it is this is

a big deal. and this administration, 47 president 47 pays attention to these numbers. now, if you look at interest rates every single maturity today, twos, threes. five seven tens 20s, 30s is trading under yesterday's low yield above yesterday's high price. if we were to close here in a ten year be the first time we've closed under 4.5% since the 17th of december. from an intraday perspective, current ten year yields are the lowest intraday since the 18th of december. this is a very seminal moment. if you're a technician. we want to watch which side of four and a half a ten closes at. and of course the 30 year seems to be ahead here. we want to make sure that both close under key levels for the 30 year. that would be four and three quarters. we still have the service sector pmi to come out at 945 and 10:00. stay tuned. mike, back to you. >> we will work. yeah december

17th right before that december fed meeting. let's remember all right. the latest treasury quarterly refunding numbers are out. closely watched by the bond market megan cassella joins us with the details megan. >> mike treasury is planning to auction. >> off. $125 billion. >> in securities that. matches expectations and holds exactly in. line with the past couple. >> of quarters. >> so no real surprises for the treasury market here. >> a few more of the numbers for you guys. >> treasury says it will be refunding $106 billion and raising about $19 billion in new cash. the breakdown. >> in. tenors will. >> also hold the same. >> as before. >> so that's $58 billion auction for the three year $42. >> billion auction. >> for the ten year and $25 billion for the 30 year. now something i do want to flag here. treasury also says in this release that it believes it will be able to hold auction sizes steady for at least the next several quarters. that language has been in there for several quarters now, and it's a good sign for stability in the bond market. but i highlight it now

because there had been some expectation that treasury secretary scott bessent, who had been critical of secretary janet yellen's reliance on shorter term debt, could have been pushing now toward issuing more, longer dated bonds that he would, at least for now, be removing that language from the statement. but treasury says that it believes it's still well positioned to address any changes to the fiscal outlook, even while holding these auction sizes steady. so good news there. keep an eye on some volatility today. >> in the. >> bond market maybe in the long end. >> of the curve especially. but this should. >> overall come as welcome news for the market guys. >> yeah megan seems to be the case. always easier to i guess have strong opinions about issuance and maturities when you're outside the treasury than when you're you're in there. thank you very much. coming up, we'll go inside elon musk's unprecedented access to and shake up of the federal government as we head to a break. take another look at some of the biggest companies reporting earnings this morning and how the stocks are reacting. stay tuned. you're watching stay tuned. you're watching squawk box on cnbc. (grandpa) i'm the richest guy in the world.

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amazing and is something that we get to use every day. >> new this. >> hour, the united states postal service. >> says it. >> will continue accepting all international inbound mail, including packages from china and hong kong. it had announced yesterday that it's going. >> to stop. >> accepting those packages because of president trump's executive order targeting exemption on goods less than $800. the postal service now saying it's going to work with customs and border protection to

implement efficient collection mechanism for new china tariffs to ensure. >> the. >> least disruption for. >> package delivery. >> this was a big deal because. >> you. >> can imagine the postal service just stopped anything out of china and hong kong. we're not going to. >> deliver it. i was wondering how much of my stuff wasn't going to get here. i think this is also bureaucratic confusion as to how to interpret the executive orders. i don't think this was an intentional and then said, oh, never mind, we can't do that. china is mad. i don't think that's the case. i think this is anybody you talk to in any of these government agencies are having a hard time trying to figure out how to interpret some of this, and there's going to be some bumps along the way. so i think that's just an example of this. when we come back, the future of crypto and ai under president trump. we're going to speak with venture capitalist steve jiang, who is who's backed companies in both areas, as well as the broader tech sector. stay tuned. you're watching squawk box and this is cnbc. >> i started lucens with the

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guest co-wrote an article covering what the new york times dubbed musk's incursion into the federal government. speaking about musk. the piece says, quote, at one point after another, trump officials have generally relented rather than try to slow him down. some hope congress would choose to reassert itself. so far, they are not. joining us now to talk about musk approach his power and concern surrounding his new york times reporter teddy schleifer. teddy, so great to see you. and again, terrific work following the money here. it was interesting. >> there's been a lot. >> of hyperbole on all sides of this, especially around usaid. and i, for one, was interested to learn that we spent $20 million on some sesame street show, $2 million on a moroccan pottery class. it kind of brings me back to the mid 1980s. you wouldn't remember it, but back then there was the $640 toilet seat and the $430 hammer pentagon. >> there's always waste. >> if you look at aid as a whole, it's $40 billion. it's a lot of money, but it's less than

1% of the government. do you think we're making too much of this agency, or do you think this sort of signals a bigger plan ahead for other agencies and cuts for musk? >> yeah. a great. >> question is why does elon musk. >> care. >> so much about this agency? >> you know. elon is. >> in. >> some ways. >> a victim of his own platform. i mean. he he sees. >> things on twitter. >> or on. >> x and responds. and to some. >> extent it's very humanizing. >> and elon has been ingesting a lot. >> of content from. >> right wing. >> media that. suggests that usaid. >> is. >> you. >> know, the. >> the. >> the rotten core of american. >> society, or. >> at least the american. >> foreign policy. and that's why he's focusing. >> so much on this, you. >> know, which is, yeah. >> $40 billion. but there are. >> you know, there. >> are. >> there are a lot of agencies that have a lot more. >> zeros attached. >> to that. and the question. >> you're. >> getting at is, does. >> this. >> presage sort. >> of the playbook. >> right. >> is this. >> is this an example. >> of what's going to happen. >> at hhs. >> or the pentagon. or whatnot. >> kind of those. big ticket

items for the federal government, where musk sends in a few 25. >> year olds to kind. >> of wreak havoc. >> yeah. and, you know, we've talked a. >> lot. >> about what legal right, he has to do this and a lot of differences even we had some members of congress on today saying, well, he's not actually cutting anything. he's just making suggestions and highlighting things. what's your sense? and musk himself has said on x that, you know, we fed usaid into the wood chipper over the weekend. what's your sense of whether he is cutting, whether he's just making suggestions to the president? usaid is a little bit different because it's sort of an executive order. but is he actually making cuts, or is this just being overblown? >> i mean, if it's being. >> overblown, it's. >> being overblown by elon. >> musk, to. >> be clear. >> not by the media. >> yeah. >> you know, i mean, there is. >> some difference here, i think, between. >> trump and. >> elon on this question. >> as you as you'd. >> guess. >> you know. donald trump is the democratically elected president of the united states. and elon musk, trump. >> has described. >> as sort. >> of his enforcer, the person. >> who's carrying out.

>> his executive. >> orders on his behalf. >> to make. >> sure that the trump government is following what the trump. >> president or. >> president trump. wants him to do. elon is portraying himself. >> as, you. >> know. >> an executive, right? >> and, you know. >> that. >> raises all the questions. >> about presidential power that have been debated for decades. >> it just he's. >> not the president, right. so, you know. >> there would. >> be ample. questions of whether. >> trump himself. >> has the. >> power to do these things. >> and then you kind of put in a surrogate. >> you know. >> a political appointee and. >> someone. >> who donald trump is the. right to name to the head of, of. >> this body. >> but it raises, you know, a whole host of other legal questions. >> so i don't i. >> don't know the answer. >> to, to, to, to, you know, the. >> legality of whether or not what. >> trump is doing is allowed. >> and we certainly don't know the answer. >> to whether or not. >> elon musk can do it. >> yeah. >> and it was interesting when treasury secretary besson put out the statement yesterday saying elon musk and doge doesn't control the treasury database, but that doesn't mean

that they don't have it. and what's your sense of what they've done with that data? what kind of legal recourse is this going to go in the courts? what do you think of these lawsuits against it? and do you think that data has actually been downloaded onto a private server, or do we even know? >> well, that's the most interesting word. >> in that letter from scott besson. last or from treasury, not from scott besson himself. last night was the word currently. they said there that currently only treasury officials have access or. >> have read only access to the payment system. i don't know, i'm not. i have. >> no idea. >> if that means anything, but it. certainly stood out to me. it made me wonder, has. >> that always been. >> the case over the last week? >> and you know, they've said, you know, we don't we. >> don't have no evidence to say. that elon. >> musk has downloaded that. >> information on. >> a private server. certainly there's. >> a, you know, a ton of speculation and conspiracy theory and hypothesizing. >> but i think this. >> is all coming into a vacuum

because the. >> musk team. >> and the trump administration has. >> not been. >> honest about or has not been. transparent about what exactly has been going on here. >> you know. >> there have been. some conflicting reporting about whether or not the read only thing is true. >> whether it's. >> always been true. >> we report here at the times that the white. house is set. on record. >> which i think is important in this day and age, that. >> it is read only. and they've said that it is d.o.j. officials. >> this is a guy. >> named tom kraus. >> who's a silicon. valley ceo, who is the treasury. don't want the lead doge person people to treasury who has that power. but certainly i think we're just getting started. >> here on. >> on answering these. >> questions because. >> you know, certainly a lot of market investors. >> want to know whether or not, you know, the elon. >> team has has the ability. >> to stop a dollar from going out of the. >> us government. >> yeah. and it sounds like his next target is the irs, which also is under treasury. he put out a poll on it saying should we audit the irs? given the sensitivity of the republicans toward what they said the democrats did with irs data leaking all the billionaire

information, what's your sense of whether he could get access to irs data? and what's the chatter in dc right now about what he wants to do with the irs? >> sure. >> i mean. >> i mean. >> this is the, you know, the guy who said he made the largest. >> tax payment in history suddenly, you know, just seems to. >> be interested in the irs. >> you know. we've reported. >> here at the times that the elon team, for almost. >> the entire. >> transition has been thinking very, very creatively or interest. they're very interested, let's put it that way. in the irs infrastructure. there's a. >> guy, an. >> advisor in bearish. >> acres, who had met with. >> irs officials. during the. >> transition and was asking a lot of pointed questions about the way it works. i mean. >> there certainly are. a lot of. >> experts on on. >> all sides who think that. >> the. >> irs infrastructure. >> is very outdated. and, you know, and frankly, auditing. >> the irs. >> should help them with their technology. that's what he should be doing. he should help them with better technology, more efficiency and more enforcement and more collection.

>> i mean, look, auditing. >> the irs has been something, as. >> you know, that has, you know, been a talking point on conservative policy for a long time. >> and frankly, i think a lot of presidents would look into that if. >> you were a republican. >> but i think the elon involvement is interesting to me as a reporter who covers him, is because this is somebody who has enormously biased opinions. >> about taxes. >> i'm not saying. biased in a negative way, but. >> like, is there anybody. >> in america. who would care more. >> about some of the specifics about, you know, wealth taxes or carried interest or, you know, tax credits for companies. >> like tesla? >> the conflicts of interest here are so obvious, it's almost worth talking about. >> and look, musk. >> can very. >> well do a lot of things you're talking about and modernize the. >> irs infrastructure. >> and maybe. democrats and republicans would applaud that. >> i don't think the media. >> should be reflexively anti doge. >> which or anti. >> cost savings. >> i just you know the conflicts here are obvious. >> teddy we got to run. thank you so much. great articles

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repeatedly that the. number one

thing they need from washington is regulatory clarity. they just want to know what the rules of the road are so they can abide by them. >> that was white house crypto czar david saxe at a news conference yesterday. during president trump's first week back in office, he issued a goal of proposing a regulatory framework for the operation of digital assets in the united states. joining us right now on the future of crypto in the us as well as ai is steve jiang. he is kindred ventures founder and managing partner. and, steve, what can you tell us so far about what you've seen from this new administration, what you like, and if there's anything that you think that you'd like to see more of? >> well. >> one. >> thing you have to give them and good to see you, becky. >> thanks for. having me. >> back on. one thing that you have. >> to give. >> them is that they're fast. they're rolling these out. >> in a matter. >> of days. >> these these proclamations. >> and a lot of. >> the. >> eos that you're seeing. >> i think. >> one. >> of the things that we're. >> looking. >> forward to with david sax.

>> in the. >> administration. >> as the. >> ai crypto czar, is that. >> the low. >> hanging fruit, bitcoin, stablecoins, smart. >> contract platforms. >> all of that regulatory uncertainty will be settled down. i think it's. >> been a shame. >> that crypto projects have been offshoring. outside of the us to avoid regulation. and a lot of the consternation that comes from it. i think, you know, a few of the things. that sit on the outskirts of that. we'll. >> have to see. i think. >> the sec and. >> and the. >> administration still want to. >> be protective over. consumer investors. and so we'll see, i think. a steady balance there. but we're seeing bitcoin, stablecoins, ethereum. >> solana. >> smart contract. >> platforms that already have a lot. >> of. >> global adoption and a lot of industry adoption. i think those will get a little bit. >> of the. >> red carpet. now. >> it sounds like the dust still needs to settle in terms of the regulatory changes that are going to take place, but we have seen bitcoin and other crypto

move pretty aggressively ahead of this, anticipating that this relaxation and maybe standardization of regulations would come. has all of the gain already been built into this. and now we wait and see? or how would you anticipate have companies come back to the united states yet? >> yeah. >> i think, you know, i. >> think on the. >> build up. there were there were a lot of. >> gains and. >> prices across. >> the board. >> so i think the market is in sort. >> of a standstill waiting to see what actually happens concretely. so i think you're seeing that right. i think, you know, from. >> a prediction. >> perspective. >> understanding. >> you know. >> not only. >> david's background but where everything. >> is with. >> etfs and the adoption that we. >> see from. >> firms like blackrock and vanguard and other large investment firms and houses is that, you know, i. >> think there are a few things that are. >> going. to happen. >> in 2025. >> to start to. >> happen in 2025 and. >> then continue through this administration. i think the biggest. >> one will be. >> that securities. will be

tokenized. >> i think that that's been a. long standing concept that has had starts and stops, but i think things like stocks, bonds, real estate will actually start to get tokenized as digital assets during this administration. and that's. >> a. >> that's a. huge sea change to how things. >> work today. >> and the. >> legitimacy and credibility. >> of. >> digital assets and crypto. i think stocks and bonds and real. estate going on chain. >> is probably the. >> biggest thing that we see at kindred happening in this administration. >> let's talk ai and the changes not only from this administration, but maybe more substantially, the changes that we have. just post deep sea, this latest release. how has that changed things in your world? what have you seen from the companies you deal with? well. >> it's really interesting. >> there was a route. >> for about a week and a lot of discussion, not only outside in. >> sort of wall street and markets. >> but in media, but also within.

>> the tech industry. >> and i. think there's two schools of. >> thought. >> thought out there. one is that the. >> you know, the speed and efficiency at. which deep tech was trained. has a has a negative. >> effect on whether or not there will be continued capital. >> investment in. >> things like nvidia chips, gpus. >> data infrastructure. >> compute, all the pre-training inputs that you need that we've seen. you know, many. companies raise billions of dollars. for now, there's. another school of thought which says actually. >> that. >> you know, there's. a paradox in economics called jevons paradox, which. >> says if when you think. >> when you make a. >> commodity more. >> efficient, it actually. increases aggregate demand. >> of the overall. so it increases the overall size of the pie. >> and i. >> think that that's i believe that that, that that school. >> of thought is correct. >> so what i think is happening. right now is that models are commoditizing. they're very

important. they're they're. highly valuable to ai, obviously at the core of ai. but i think value is accruing now. out towards the. application layer, apply to ai. and that means. >> if i were to do this. >> but they're going to roll a brick right over our head. we are out of time. i would love to have you back for this, but thank you for joining us today, steve. we appreciate it. also, my thanks to both mike and to robert. we will see you right back here tomorrow. right now it's time for squawk on the street. >> good wednesday morning. welcome to squawk on the street i'm carl quintanilla with jim cramer and david faber at post nine of the new york stock exchange. futures a bit soft amid some lumpy. corporate earnings guidance and continued worries about trade relations with china. ten year yield now the lowest since mid-december. as bonds focus a bit on the growth implications. a road map begins with the ai arms race, though, as. spending continues to ramp. >> alphabet and amd. >> delivering the latest. >> read on the ai boom. >> plus, apple shares. >> are under. >> pressure