unpredictable surprises everywhere. but the headline here in tampa, malcolm stewart, a race winner after such a long time, such a long wait. we say, well done, malcolm. >> good morning. >> happy monday. >> everybody, and welcome to street signs. i'm julianna tatelbaum and these are your headlines. president trump threatens 25% tariffs on all steel and aluminum imports, adding a new front to his tariff trade war. steel makers falling toward the bottom of the stoxx 600 in early trade. bp shares jump as activist elliott management reportedly built up a stake looking to push the oil giant to boost performance.

german chancellor olaf scholz and election frontrunner friedrich moritz go head to head in the first television debate. with the health of europe's largest economy dominating the conversation. >> i was. >> stunned. >> which i'm. >> shocked at how you're. >> interpreting the situation. >> we are. >> now in the third year. >> of a recession. >> this has. >> never happened in germany before. >> we are. >> we are better than others when it comes to exports. that's why we also feel, to a greater extent, what's happening in the global economy. >> french president. >> emmanuel macron. >> pledges more than ■k7100 billion worth of ai investments. >> as top names. >> in the private and public sector descend on paris for the ai action summit. we'll hear from meredith whitaker, president of signal, this hour. >> a very good morning to you, and welcome to the program.

another turn in the trade war is on the agenda. this morning, president trump says he will impose a 25% tariff on all steel and aluminum imports today on top of existing duties. speaking to reporters on board air force one, trump also said he would announce new tariffs on countries which restrict u.s. exports, with details expected tuesday or wednesday. >> it won't affect. everybody because there are some where we have similar tariffs, but the ones that are taking advantage of the united states, we're going to have. a it's reciprocity. it's reciprocal. >> here's a look for you at. how the european metals names are reacting to the news. we are trading lower but fairly muted in terms of the magnitude of the sell off we're seeing this morning. so investors to some extent taking this next turn in the trade war in stride. thyssen-krupp down about 7/10 of a percent. salzgitter down more than 1%. you are seeing a bit more of a pullback in arcelormittal down 2.8%, norsk hydro down 0.6%. the european

commission said this morning that the tariffs would be unlawful and economically counterproductive, adding it will aim to protect the interests of european businesses. this after french foreign minister jean noel barroso said the tariff announcements are in no one's interest. well, sylvia has been working hard this morning looking into the european response. sylvia, tell us more about how europe views these new tariffs and what the response may be from the european side. >> so perhaps a bit of context. >> this is not the. >> first time we're hearing. donald trump. potentially putting tariffs. >> on. >> european steel and aluminum. >> back in 2018. >> when he. >> was doing his. >> first mandate. as president of the. >> united states, he. >> imposed steel and aluminum. >> tariffs after a lot. >> of back and forth. and, of course, with the biden administration, these tariffs were actually on pause. >> until march 2025. >> so for the. >> time being. >> these tariffs were not, you know, implemented. however, we heard from the president over the weekend saying that there will be new tariffs announced today on steel and aluminum. and

these would, quote, affect everybody. so the. european union has already, since the reelection of donald trump, been working to protect themselves in case there were tariffs on european goods. so we wouldn't be really a surprise for them if this were to be announced also against the european union later today. as a result, though, i contacted the european commission and a spokesperson said this morning that they see no justification for the imposition of tariffs on its exports and that they will react to protect european businesses. an important comment over the weekend. giuliana was from the german chancellor, olaf scholz, suggesting that the european union could be in a position to retaliate within an hour. that would be a very fast response, but it would highlight that they are prepared for this eventuality. they have been doing so for a long time, really. so let's see whether this announcement is going to come through and indeed, what sort of tariffs the european union could announce in response. but back in 2018, we saw the european union imposing tariffs, for instance, involving

some of the american whiskey and bourbon, the jeans, motorcycles as well. so it could be a similar list that we would get this time around. but of course it will also depend on the amounts that the donald trump announces later today. so all eyes at this stage on what the trump trump is going to say. >> well, it also seems really unclear at this stage just how much of a tactic these tariffs are versus, you know, whether these are the end game for president trump and whether he's just trying to bring parties like the european union to the negotiating table or parties like china, which to date that hasn't been the case. they actually moved ahead with the tariffs. china retaliated and we haven't seen any any negotiating happen. >> but when we look at the canada and mexico tariffs, indeed those are on hold for the time being. so that suggests that there's perhaps room for negotiation. from a european perspective though, everyone is kind of expecting that they will have to buy more american energy. donald trump already suggested that the presence of european commission suggested

that. so that could be, you know, a path for some sort of easing in the trade conflict between the us and the eu. but for the time being, we don't actually know how this is going to unfold, because donald trump has not yet gone as far as imposing tariffs on the eu. but the continent is on alert. they are ready to take action the moment those tariffs are announced. and, as usual. >> the question of unity, i'm sure, will be front. and center. and how how much, how long the european union can remain united in its response to the us. well, sylvia, thanks for getting response early on. let's get back to markets and check out the reaction not only to the new tariffs that have been announced by the president, but also to the movements of last week. we saw the stoxx 600 advance 0.6% last week, its seventh positive week in a row. so we are coming off of a strong performance for european equities this morning. we're up another third of a percent. so markets generally shrugging off the tariff threat and the economic impact from more potential tariffs. in terms

of the regions in europe. here's the split this morning in the early hours of trade. you've got ftse 100 in the uk up half a percent. the xetra dax lagging a little bit. the cac40 up about 2/10 of a percent, the ftse mid up about 2/10 as well. so fairly contained but moves to the upside in terms of us futures. here's how wall street is looking. we have green across the board on wall street as well. the nasdaq and the dow looking to add about 103 points apiece. the s&p 500 looking to gain about 18 points. we did see u.s. stocks close out the week on the back foot and end lower for the week overall, but fairly muted in terms of the magnitude again, especially in the context of these new tariffs coming into play and the threat of more tariffs. the markets have actually been pretty calm. so let's talk to daniel morris more about why that is. chief market strategist at bnp paribas asset management daniel great to see you. wonderful to have you on street signs again. so my question to you is why markets have reacted relatively calmly

to what is a pretty large economic threat from these tariffs. >> well. >> i don't know if i well. >> i guess. >> evidently the market hasn't seen it yet as a large economic threat. i mean, the potential we all appreciate is. >> that there. >> but what we've seen so. >> far. >> is kind of like a parallel track. >> so on one hand, clearly seen trump using tariffs as a negotiating tactic. so colombia, mexico, canada where the tariffs were a means to an end as opposed to what he really wanted to do. now with the steel and aluminum tariffs, we understand there may be something different here. so i think the market has learned, if you will, to differentiate if it can. >> and why do you say this could be something different. >> well here, if you want to think about what the justification is going to be. and in this area, the us certainly is not alone in that. if you see steel and aluminum production as a strategic necessity, which at least is justifiable, then having tariffs to protect an industry where you do want to have that capacity domestically, you know, is understandable as opposed to, say, 10%, 25% on absolutely

everything. so that would be where the market certainly would get worried. i think we're quite a ways from that right now. >> and in terms of the reaction in global markets versus us markets, it's been quite interesting looking at the performance of the likes of europe year to date. we've got the stoxx 600 up 6% on the year. it's outperformed the s&p 500 in dollar terms. does that make sense to you that europe would be outperforming the us. and if yes, do you think that outperformance is sustainable. >> well, i think at least european investors may need to enjoy it while it lasts. because if you do step back and look at what do you think the trends are going to be over the next, let's say six months? you know, let's take the fourth quarter earnings season. you know it's been positive for europe. but us you know, much, much higher which is historically the case. earnings surprise is stronger in the us than in europe. so if fundamentally earnings are what drive equity markets. you just don't see the same momentum. if you look at earnings revisions again more supportive for the us. if you do get tariffs that's better for the us. so for now maybe it really was. so much of

the bad news was priced in for europe. that said, if you look at the economic data that was released last week, almost all of it disappointed in europe. so it doesn't really feel like even with this performance of the market, that we're at a turning point, we'll have to wait and see. >> in terms of the us market, then if you know there is a lot of momentum in the us's favor that's not present in the european market, it also feels like there's a lot more to lose in the us. and from a valuation perspective, if you look back at trump 1.0, we were coming in to the administration in a much worse place. from a stock market perspective, the s&p was up only modestly in the period leading up to the trump trump's first presidency. in this case, the s&p 500 was up 50% in the last two years. valuations are a lot higher than they were, so you've got a lot further to fall this time around. does the same playbook work still? >> well, certainly not the same playbook. i mean you're right. it's a very, very different

world than what we had last time. i think though, if we try to nonetheless look at where are we today and what do you expect in the future. so you're right, it comes down to valuations and comes down to earnings. so if you think of the s&p but think of it as two different markets if you will. so nasdaq and russell value. so for nasdaq earnings i think people are still pretty optimistic i think valuations are moderate. so i really don't see any big risk there for value stocks earnings also fine valuations perhaps a bit higher. so certainly not to suggest there's not some vulnerability if we do get a negative surprise because it's such a popular investment right now, you would expect an outsized reaction. and as it happens we've pulled back our overweight to the us and are now kind of neutral on equities overall in terms of the region's kind of reflecting this fact that we've done quite well, you're starting to get a bit more risk. let's wait and see how things evolve. >> so where. >> are you bullish then. >> right at this point. nowhere. so thinking that you're going to see a broadening. and you know this should be seen in a positive way a broadening of the

equity momentum. so as you mentioned europe doing better. not clear. you know actually having that us overweight hasn't worked. so we want to you know kind of have that broader exposure. we see potential for some of these lagging markets to pick up before deciding okay. it's more clear where we think the next big leg is going to be. >> daniel. thank you. maybe you'll. be more. bullish next time you're on set. but i appreciate the candid answer. and if that's what it is not so bullish anywhere then that's okay. daniel morris, chief market strategist at bnp paribas asset management, activist hedge fund elliott has reportedly built a large stake in bp. that's according to multiple sources reporting that it will push the british oil giant to make transformative changes to boost performance and buoy its share price, which lags behind rivals such as exxon and shell. the size of the stake is unknown, and elliott and bp have declined to comment. now earnings are set to continue. another busy week across europe. we've got oil giant bp reporting tomorrow. will be interesting to see whether they do comment on reports of elliott stake. we've

also got results from unicredit and caring. and then on wednesday we'll hear from tech investment giant softbank and brewer heineken. thursday will bring us results from barclays, siemens and commerzbank following last week's job report. attention now turns to the week ahead with the closely watched cpi print on wednesday. we will also get fed chair jerome powell's testimony in the capital on tuesday and wednesday. thursday will then bring january's ppi reading alongside initial jobless claims, with retail sales rounding off the week. on friday, i'll be paying particular attention to jay powell's testimony to congress. always interesting to get his take on the state of the us economy. now, in terms of the market reaction to these new tariffs that president trump put forward yesterday, here's a look for you at united states steel corp. you've got an extended trade us steel higher premarket as nippon mulls bold buyout revision. trump pledging tariffs. that is one to watch

ahead of the us market. open. now coming up on the show olaf schulz and friedrich maritz clash on trump debt and nato in their first televised debate. as the country's election campaign enters its final fortnight. we'll bring you the latest next. >> home, where routine meets remarkable with unexpected moments of inspiration around every corner and through every window. quiet mornings in the sun with portals to new worlds and fine dining with a view. your window treatments should be as inspiring as your home, and the remarkable routine of your daily shopify's point of sale system helps you sell at every stage of your business. with fast and secure payment. card readers you can rely on. and one place to manage it

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learn more at stokoe comm. cnbc exclusive take-two interactive ceo's first interview. post earnings. the state of gaming and growth outlook. plus breaking earnings news from mcdonald's. reaction and analysis. squawk box today, 6 a.m. eastern. cnbc. >> welcome back to the program. german chancellor olaf scholz and his election rival friedrich merz, went head to head sunday evening in the first televised debate ahead of this month's election, with the pair clashing on migration and the far right alternative for germany. energy policy and the future of the german economy. anita joins us now with more on this debate. anita. so looking at the polls heading into this debate, olaf schulz's social democratic party polling in third place, pretty

far behind friedrich merits. and i think a lot were looking at this debate as the last opportunity for olaf schulz to potentially change the shape of the race. has anything materially changed as a result of this election debate? >> no, because. >> what would. >> have. >> needed what would he again, what. would he have. >> needed is a clear. >> victory in. >> that debate. >> so and that hasn't happened. olaf schulz came out probably at par with friedrich merz a. little bit ahead in the first poll. conducted by the public broadcaster. >> zdf. >> but he didn't really make a mark, especially in favor of his party. so what happened. >> is that they. >> actually exchanged more or less common views about migration, the economy, energy policy. but there was nothing really surprising in all of that. of course, they don't agree on the state of the

economy. while olaf is insisting that germany is very strong and has a lot of potential, which of course is pointing out that germany is lagging behind and it's losing competitiveness because perhaps we listen in or it's short picture of how those two candidates actually have a very different take on the economy. by the. >> manhattan we had more to fight against with rising industry costs and energy prices, we in germany must import coal, gas and oil, the prices of which exploded unbelievably, and our economy felt this much more. and we don't need to go into how another government named mr. altmeier as economy minister and miss merkel perhaps didn't do all they could have to make us more independent. yes, i was also in that government. i'm not denying that. but this was the starting point for the situation we now find ourselves. >> in. >> and i do not find it. okay. when you pretend this is something that we can simply just shake off. >> i must say, i'm. >> shocked at how you're. interpreting the. >> situation. >> we are now.

>> in the third year of. >> a recession. this has never. >> happened in. >> germany before. >> we have. >> 3 million. >> unemployed with. >> the number. >> rising and. 700,000 open. >> positions that can't be filled. >> we're seeing. >> a. >> wave of. >> insolvencies. >> the likes. >> of which we. >> haven't seen. >> for 15 years. >> 50,000 companies. >> went under during your term. >> in. >> office. >> around half of which in the last year alone. these numbers are only rising, and you're talking like. >> we're not. >> going through a deindustrialization. >> what's the loss of. >> 300,000 jobs? this is deindustrialization. >> so i think never before we have seen industrial associations going and protesting against the economic policy of. >> a government. >> that has happened just at the end of january. >> in berlin. >> and all. across the country. so i think the sense of urgency is very high among business leaders mittelstand companies,

that something has to change in order to be able to, yeah, perform as a country and also to attract investments in the country, because that's one major other issues. we have seen a almost record outflow of capital in the last three years, and investments also of german corporates are not taking place inside germany, but outside the country. in another part of that debate, there have been, of course, clashing on migration with friedrich merz is being very tough on illegal migration and olaf schulz insisting they've already done a lot in the last three years. so you see, but going into the polls, nothing materially seems to have changed. friedrich merz sits firmly at roughly 30%. his party, the spd, is far behind at roughly 16%, and between them sits the afd of, for the first time of more than 20% of people

in the whole of germany are most likely going to vote for the far right or populist party alternative for germany. >> anita, thank you for breaking down the debate last night. do stay with us for this next guest. david dyson, managing director of foundation for family, businesses and politics. david, thank you for being with us to help us digest the debate, but also frame what the business environment is like in germany right now. david friedrich moritz says he's very well aware of business leaders concerns and what the economic issues are in the country. he says that he the country is suffocating with red tape, that he's prepared to cut taxes, cut electricity, taxes, corporate taxes, among other things. are you confident, though, that if elected, he will be able to deliver on these election promises? >> well, i mean. >> we as an organization, of course, we do not make any recommendations. >> what people should vote for, but, you know, wouldn't come as

a surprise that german businesses are, you know, closer to the positions of the christian democrats in germany and also the liberal party. and of course, you know, we saw in, you know, very. >> much welcome, friedrich. >> very clear statement that that we need a correction in the kind of political framework, conditions that we need a correction. of the course of the government because, as you know, you just pointed out, we have serious. problems in january. we have a very high unemployment. >> rate at the moment. >> we have the third year of recession. >> now in. >> a row with no end in sight. we have bankruptcies. >> up 25%. compared to. >> last year. so yes, there's a certain degree of confidence that, you know, with a change of government. towards a. >> more economically. >> friendly policy, we will we will see improvements and we need these. >> improvements very. >> very urgently, particularly for the family businesses. >> here in. >> germany, which. >> make actually up to. >> 90% of all businesses in

germany. so it's very much an sme based economy and we need. better conditions. and. >> you. >> know, it has to make sense. >> again. >> for people to do business in germany. and they are faced with a lot. >> of problems at. >> the moment. >> david, you raise an important stat there that family businesses make up 90% of companies in the private sector and provide almost 60% of jobs. so clearly, these businesses are critical to getting the german economy going again. what specifically do the family businesses that you represent need to see to begin investing in the country again and critically, to begin hiring again? >> well. first of. >> all. >> you know, we really. >> see that deindustrialization is already a fact. i mean, we. actually conducted a survey recently, and 76% of all family businesses in germany said that they will reduce investments in germany within the next. five years. and the main reasons that we hear are of, you know, of course, red tape, the regulatory regulatory burden for german

companies are. >> very, very high. also, when. >> you. compare germany to other oecd countries, we have. >> very. >> very high energy costs. you know, the price for electricity is twice as as high as it is, for example, in the united states. many of the companies also criticized that they do not, you know, have any clarity. >> on where the. >> prices will be going. we saw. you know. >> in the. >> in the so-called traffic light coalition of the past three years, a lot of corrections in the course of energy policy. we didn't really see an improvement when it comes to red tape. on the very contrary, we saw that even. >> more, you. >> know, regulatory burden was imposed on the german economy. >> not only. >> through german regulation, as, for example, our german supply chain act, which kind of preempted the european regulation. so we need. >> you know. >> really a serious step towards less government control, less,

you know. reporting duties that are a. >> serious burden. >> at the moment for the german companies. >> david, let me jump in here. so provided there will be tax cuts for corporates and less regulation. i mean, friedrich merz will also be at least semi tied when it comes because of the coalition building. but provided that kind of is happening, will investment come back to germany from the mittelstand company? >> well you know. >> investment must come back. you just mentioned taxes. >> we actually. >> have you know again. >> when compared. >> to other oecd countries, very, very high taxes, particularly for companies, we. >> are at. >> you know, really at the, at the very top of, of tax burden. >> and you know, that. >> that really has has to change. and of course, there is confidence that investments will come back. we still have, you

know. >> skilled labor. we have we have. >> a lot of high end engineering, you know, the so-called hidden champions in germany. and there is, of course, a lot of potential. but again, the conditions have have to improve significantly. and the federal government must prioritize ensuring that the also the european commission, you know, is. not only de-escalating trade conflicts that we are faced with at the moment, but that we also have a stronger voice in europe when it comes to expressing german. german interests. what we saw in previous. >> years was more. >> kind of german gold plating. so germany tried to kind of preempt european legislation and in many cases made it even more complex for german companies. you know, when it comes to, for example, supply chain regulation. but yeah, again, taxation is certainly a huge issue for german companies. and what was disturbing, of course,

for many people doing business in germany is that the spd, for example, was now claiming higher taxes, was also, you know, flirting with the idea of increasing inheritance tax, which is a real threat for the substance of family owned businesses because they would have to, you know, pay these inheritance tax with each change of a generation. so more or less every 30 years you would have an inheritance tax, which is a substantial threat and a risk for german businesses. >> david, thank you so much for joining us. david eisner, managing director of foundation for family, businesses and politics. anita, thank you as well. still ahead on the show. more from the ai action summit in paris. arjun, what's coming up? >> well, look, while ai has been advancing rapidly, there may be implications for our privacy. that's the view of my next guest, meredith whitaker, the president of signal, who will join me right after this break. stay tuned.

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>> experience the power of cnbc pro. all new investing tools securely linked to your brokerage accounts. become a smarter investor with the power of cnbc pro, go to cnbc.com slash get pro now. >> welcome back to street signs i'm julianna tatelbaum. and these are your headlines this morning. president trump threatens 25% tariffs on all steel and aluminum imports. adding a new front to his trade war. steel makers falling toward the bottom of the stoxx 600 in early trade. bp shares jump as activist in elliott management reportedly builds up a stake. looking to push the oil giant to boost performance. german chancellor olaf scholz and election frontrunner friedrich moritz go head to head in the first television debate. with the health of europe's largest economy dominating the conversation. >> i'm shocked. >> at how you were. >> interpreting the situation.

>> we are now in the third. >> year of a recession. >> this has. >> never happened in germany before. >> i think. >> we are better than others when it comes to exports. that's why we also feel to a greater extent, what's happening in the global economy. >> and french president emmanuel macron pledges more than ■k7100 billion worth of ai investment as top names in the public and private sector descend on paris for the ai action summit. we'll hear from the president of signal, meredith whittaker, in a few moments time. we are 1.5 hours into trade on a fresh trading week. let's take a look at how european equities are faring. we are coming off of seven positive weeks in a row for european stocks. and this morning we're building on those gains. the main benchmark up a third of a percent. and we are seeing the majority of stocks trade higher. as you can see there in terms of the sector

breakdown, here are the outperformers in europe this morning. you've got the in terms of markets. you've got the ftse 100 up 4/10 of a percent. the xetra dax and the cac40 up about ten basis points or so in the ftse, up 2/10 of a percent. in terms of the sector gainers. those that are leading the charge this morning. you have got real estate up in the leading position one more than 1% higher. telcos oil and gas and retail. now on the downside this morning here's a look at the laggards in europe. you've got basic resources down a third of a percent. so investors are selling some of those basic resources names steelmakers in particular in response to these new tariffs on steel and aluminum imports from the trump administration. but fairly modest in terms of the magnitude of the selling that we're seeing, construction and materials also trading lower this morning and health care, other than that, every sector is higher now. iag shares are in focus in the travel and leisure sector, and that's part of why that basket is among the underperformers this morning. iag is down after goldman sachs

downgraded its rating on the stock to neutral from buy. in the telco space, nokia has named justin hotard as its new ceo, replacing pekka lundmark. hotard is currently at intel and leads the data center and ai unit, and will take up the new position in april. outgoing ceo pekka lundmark spoke to squawk box just a few weeks ago, and was asked about nokia's succession plans. >> we are doing succession planning pretty much for, for continuously for all board roles and management team roles as well. and in that succession planning, we are identifying both internal and external candidates. and we are doing some. >> of that. >> work with external partners as well. i don't know if, if any of that would be behind those. those rumors, but what is important is that all of this is done is done in. >> full cooperation. >> between the board and management. >> tsmc says it expects to see its first quarter revenue closer

to the lower end of its guidance, but reiterated its full year guidance. the chip maker also said it is making every effort to recover lost production after an earthquake last month, which impacted several factories. tech giants are expected to spend more than $300 billion on ai this year as they race to keep up with demand. amazon, google and microsoft have all pledged to increase ai spending in the upcoming quarters, targeting growth, particularly in their cloud business. meanwhile, meta ceo mark zuckerberg said 2025 would be a defining year for ai. french president emmanuel macron has announced ■k7109 billion woh of private sector investment into ai over the coming years. speaking ahead of the ai action summit in paris, macron said europe needed to step up its ai spend in order to end its reliance on us and chinese innovation. deep six ai model could be the best work out of china, but the hype is exaggerated. that's according to

google, deepmind ceo demis hassabis. hassabis is speaking at a google event in paris. he said the ai model can do extremely good engineering and changes things on a geopolitical scale, but from a technology point of view did not represent a meaningful change. while arjun is on the ground in paris, he's been at the ai summit. as things rap rap ramp up there. arjun, what a guest list at this summit. it feels as though macron is trying to put europe on the map and trying to push this view that europe can keep up with the likes of the us and china. how is he doing? >> and that's certainly a big theme here. europe really want to make a bit of noise, shout about the companies. it has, the leadership it's taking in certain areas of ai. but of course there's tensions between the us, between china and also between europe as well. so europe wants to just try to cement its position there. that's one of the themes happening on the geopolitical scale, but also how these countries all work together around risks, around mitigating those risks and forming some

sort of framework. and finally, of course, deep sea on everyone's lips here as well. >> and look. >> i want to get into all of these topics with my guests now at this hour, meredith whittaker, the president of signal. meredith, i just want to first kick off the conversation with deep sea. just because it's a huge topic in the world of ai. what has it done to assumptions around bigger is better for models around infrastructure spending. >> power. >> energy consumption, all of these things that you're thinking about. >> well. >> look. >> deep sea. >> was a masterful gambit in diplomacy or lack thereof, perhaps. in the ai brinksmanship that is currently happening between the us and china. where the hyperscalers that provide the infrastructure for the world's tech ecosystem reside. >> so i think. >> it's. >> it's interesting from that perspective. >> now. >> i think we. >> need to put that. in historical context before. >> we make. >> too many leaps. >> however, every moment in the deep learning revolution. that

we're in now has in. >> some sense been defined by efficiency gains. so you can look back to 2012. >> when a paper called alexnet. proved that we could use fewer chips, these. gaming chips, to develop huge models. >> we can look at. >> 2017, when the. >> transformers architecture did a similar thing for deep learning architectures. >> and what happened. >> after each. >> one. >> of these efficiency. >> gains was not. >> a. turn to smaller models, to more efficient, to spending the same amount of to spending less money to build. >> the same size model. >> it was. >> a turn toward. larger models. >> saying, now that we can do this. >> more. >> cheaply, now that we. >> don't. have to use as much compute. >> how about we do it bigger? how about we. spend the same amount of money to build bigger and bigger. >> models and continue this race. >> for scale. >> that. >> importantly, ultimately. >> accrues power to the companies that have the chips, have the data. >> and have. >> the market access. >> so this. >> is not. >> something that's. >> going to disrupt.

>> the concentration. >> of power or. >> the geopolitical balance. >> at this stage. and i think we have to keep our eye on the ball. >> there and recognize that it's. >> really this bigger is better paradigm that is not reduced through efficiency gains historically. >> that is. driving this concentration. >> and that is really what we should be looking at here. >> and that's fascinating because when we spoke in the past, you flagged concerns about the concentration of power about these huge tech giants who have the resource to be able to train these huge models. and there's very few of them in this world. has open source at all, changed the game because that's really what we've seen from from deep sea. and now startups as well. is that is that going any way to disrupt any of this concentration of power? >> well, open source provides transparency. so you can see, you know, depending on how open it is. and that's a whole different conversation. >> you can see how it. >> was trained. you can perhaps. >> look at. >> the weights. if it's a more extensive open source model. >> you can. >> reuse it. >> you can fine tune on top. >> of it. >> but open. >> source does not open source

the vast amounts of compute necessary to train a base model. it does not open source. the market access necessary to commercialize. >> a. >> model. >> and it does. not importantly. >> open source. the vast, vast, vast. >> vast quantities. >> of data required. for training. >> for inference. >> and for the actual. >> creation and. >> development and maintenance of these models. so it allows transparency, it allows extensibility, it allows us to reuse models. and those can all be good, but. >> it in. >> no way actually perturbs the concentration of power that has. accrued to the large tech companies that have. >> all of those ingredients. >> now. >> a. topic that hasn't received a lot of attention, but but should do is our privacy in the world of ai? that's what you're here to talk about. so what exactly right now are you focusing on? what are some of the concerns you have with the way the rapid development of these models and the way consumers are using these ai services? >> well. >> i'm the president of signal. >> so all day, every day, every

year i think about privacy and i think about. >> how fundamental. >> privacy is to. >> so much that we take. >> for granted. % journalism. confidential conversations in the boardroom, whether it. >> is human rights. >> work or military. >> communications. >> intelligence, communications, you name it. signal is the nervous system for private communications across the globe. >> and we take. >> this very seriously. we don't think there's a more fundamental right. and frankly, i don't think there's cooler tech in the world than signal right now. but we do have concerns with the rapid drive to incorporate ai into everything good, bad or indifferent. right. and you're. seeing things like ai moving onto the device. you're seeing a hunger for data. because let's be real, i can't make a determination. it can't give you an answer. it can't classify something. it can't tell you what's in your photo. it can't

do anything without access to your data and its access to the data and the sloppiness that we're seeing as ai gets. integrated into sensitive environments, sensitive contexts, that is really concerning to signal and something that we are pushing hard against and trying to. >> sound the alarm. >> about here. >> because we lose. >> privacy, we lose all of those fundamental rights. >> so how do you balance that, meredith? because, you know, those who are obviously saying i can lead to productivity gains, can boost economic growth, etc. and. help out all of those things. how do you balance that with integrating ai into society, but in a way that protects privacy? it feels like a very difficult balance. >> well. >> i don't know that we're balancing two equally weighted substances, right? of course, there are actors. of course there are the hyperscalers. of course there are those who've spent trillions of dollars in capex and are really counting on a return on their investment. who will make a lot of claims about what i can do, and some of them will be right. but

fundamentally, we can't have economic productivity, we can't have functional governance, we can't have journalism, which is the fourth estate of a democratic society. we can't have human rights work, we can't challenge. >> institutions. >> we can't whistleblow. we can't have military command and control without privacy. so you undermine that, right? i don't think we're looking at a world where the artifice that supports these ai claims exists anymore, and we have to be real about that. you know, hype is great for your board. but when we're talking about fundamental rights, when we're talking about the future. >> of our. >> institutions, we can't ride on hype. we need to be real and concrete and recognize that we must protect privacy. we must ensure that signal and the. nervous system. >> of private. >> communication persists. in this moment especially. >> it's got a few seconds very quickly, not asking for a silver bullet, but we have india, china, us, europe all represented here and other countries as well. does this require a global solution regulation, a framework? what is the answer in your view?

>> those are really big words. what it requires is us to come to the table, be very real and very practical about what we're talking about. we're talking about a technology that relies on vast infrastructure, vast data, and that can, without proper guardrails and democratic governance, lead to significant concentration of power that could be deleterious for the world at large. >> meredith, thank you so much for your insight and time and shining a light on on privacy in the in the age of ai. that was meredith whitaker there, the president of cigna, with some very fascinating insight into a topic we probably haven't paid enough attention to as of yet. plenty more from the ai summit over the next few days. and of course, you can read more on cnbc.com, where i've written an article about demis hassabis, his views on deep tech, and what it means for the broader ai model. for now, giuliana, back to you. >> thank you for bringing us that fascinating interview, and i look forward to your continued coverage out of paris. now coming up on this program, philadelphia celebrates as the

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>> cnbc exclusive take-two interactive ceo's first interview, post earnings, the state of gaming and growth outlook. plus breaking earnings news from mcdonald's reaction and analysis. squawk box today, 6 a.m. eastern. cnbc. >> welcome back to street signs. let's take a look at some live shots from the superdome in new orleans, which last night played host to super bowl 59. the philadelphia eagles secured a dominant victory over the kansas city chiefs, denying the chiefs a third straight vince lombardi trophy in a 4022 win. just hours ago, we saw celebrating eagles fans pour out of the stadium after that victory, the franchise's first since it won the big game seven years ago in kansas city. watch party crowds started to thin out in the second half of the match as their defeat became clear. very sad images, but there were very different scenes in philadelphi,

with celebrations across the city continuing late into the night. fortunately for us, we've got brennan white standing by from nbc's wcau in philadelphia. brennan. this morning i woke up and i had to wade through so many celebrity shots on all of my social media feeds before i even found out what the result was from the super bowl. tell us about the celebrations that have been going on in philadelphia. >> oh my goodness, people are just so excited. it has been such a fun night throughout philadelphia. it seems like most people have cleared out. here. we are on market, which. >> is a busy road here in. >> center city philadelphia. there's a lot. >> of cleanup left to do, as you can imagine. >> but people were just shoulder to shoulder last night. >> celebrating this philadelphia eagles super bowl win. >> take a look behind me. >> you can see. >> there's a. >> lot left to be done. here on market street in. >> center city. there's a lot of trash left behind. there was actually a fire here. this looks like hotel linens from what i can see close up here that is

out. >> right now. >> someone managed to knock down a light pole somehow, and someone was parading that through the streets, so there's definitely some work. >> to be done. >> if you could say that here in philadelphia. but as you can see, it has. majorly cleared out. police asked people to leave this area. >> around 1:00 this morning. >> so we do have a. >> quieter scene than we did last night. still some fans. >> driving throughout. >> the area. >> they just. >> opened up the. >> roads in the last couple of hours as. >> we were driving. >> through this area. so a lot of work. >> to be done, a lot of information. >> to gather. >> still from the mayor's. >> office, but as of right. >> now. >> things are. calm here in philadelphia, people just really excited for the philadelphia eagles. it's been a few years. since we had. >> a super bowl championship. >> here in the city, and. >> we. >> have learned that the. >> parade that will go. >> through broad street here. >> in center city. >> will be on friday. so a lot of cleanup left. >> to do and a lot of prep before that parade happens. but an. exciting time to be. >> a philadelphia eagles fan. >> for sure. for now, reporting

live in center city philadelphia, brenna pike, nbc ten news. >> brenna, thank you for bringing us the latest. it looks like it was quite a celebration. i'm pretty impressed you're standing there. i don't know if you've been up all night or you just woke up, but either way, quite a feat. brenna wake from nbc's wcau in philadelphia. thanks for joining us. now in d.c. we're keeping a close watch on donald trump, as usual, who has vowed to slash billions of dollars in u.s. defense spending. with the pentagon set to become the latest target of elon musk's department of government efficiency. speaking to fox news ahead of last night's super bowl, trump hailed musk's efforts in reducing government spending. >> trust, elon. oh, he's. >> not gaining anything. in fact. >> i wonder how. >> he can devote. >> the time. >> to it. >> he's so into it. >> but i told him. >> do that. >> then i'm. >> going to tell him. >> very soon. like maybe in 24. >> hours. >> to go. >> check the department of education. >> he's going. >> to. >> find the same thing. >> then i'm. >> going. >> to. >> go go to the military.

>> let's check the military. we're going to find billions. >> hundreds of. >> billions of dollars of fraud. >> and abuse. >> but i. >> campaigned on this. >> alice barr joins us now from washington. alice, tell us more about the trump administration's next target. elon musk's efforts have got a ton of attention and not not the not good attention from many in the us in terms of what he's been doing to some of washington's key institutions. >> write in the latest to come into the crosshairs has been the consumer financial. protection bureau. employees of that agency that. help consumers, of course, with any issues that they might want to report. they were told to work from home until the end of the week. and this is now coming as. >> the just. >> confirmed director. >> of the office. >> of management and budget, russell. vote took control of that agency and shut down all of its activities. so that's happening overnight. while, as you noted, the next that.

>> is set for. >> targeting and potentially. slashing is the department of education. over the weekend, some democratic lawmakers tried to get in to that department and were turned away. they have concerns about what cuts may be coming. president trump on the campaign trail talked a lot about shutting down the. federal education department and sending those responsibilities back to the states. he's also talking about going to the defense department and looking through their looking through the military for any areas. of fraud or wasteful spending, as he's put it. and that could be these are much bigger departments that we're talking about now, defense and education, as. >> opposed to. >> smaller cuts that have come, as i mentioned, at the consumer financial protection bureau and of course, at usaid, the foreign aid, if you're really talking about larger cuts at these larger agencies, you could start seeing some bigger numbers and, yes, more pushback, for sure. >> and, alice, in terms of the pushback, tell us a little bit more about the response from congress, in particular from the democrats to what musk's been

doing. >> yeah. >> we. >> just heard over the weekend from senator andy kim of new. >> jersey. >> who said that he thinks we're on the cusp of a constitutional crisis. we heard president trump speaking about how he doesn't think that the courts should be doing what they have been doing in terms of stopping elon musk's department of government efficiency from having some of the access and some taking some of the actions that that they've been taking. and he and jd vance, the vice president, both said that they they both sort of pushed back on the power that the courts have to be stepping in. and what you're. >> hearing from. >> senator kim and others is that that poses another concern about the separation of powers, that the executive branch is, in some ways casting doubt on what the legislative branch is doing. and, you know, what we're hearing from democrats is that they're not going to go along with anything to do with the trump administration, and that's setting up a potential showdown

over a government funding deadline next month. and it looks like we might be headed toward a shutdown when that moment comes. march 14th. >> alice, thank you for breaking it down for us, and thanks for your continued coverage. that's alice barr in washington. now back to the market action. we are coming off of seven positive weeks in a row for european equities. and overall we are trading higher in europe this morning. a little bit of divergence right now from the french market which is down just below the flat line but overall essentially flat on the morning. the xetra dax also hovering around the flat line ftse 100 up 3/10 of a percent and the ftse mid up about eight basis points or so. bp coming sharply into focus this morning after elliott, the activist hedge fund is has reportedly built a stake in the company, according to multiple reports. the activist is trying to push bp to make some pretty transformative changes. it has underperformed peers. you can see in the in the past year, the stock is down 3.8%. that is an

underperformance relative to peers. it's lagging behind exxon, behind shell. the size of the stake is unknown. we have no comment at this stage from bp or elliott, but we are going to hear from bp tomorrow on the earnings front. so we'll see if they are given any questions from analysts on this. usually the companies are pretty tight lipped around activists, so don't expect much. but it will no doubt be front of mind for analysts and in turn for investors. we're also keeping a close eye on european steelmakers and the broader metals space on the back of news that the trump administration is putting forward new tariffs on all steel and aluminum imports. you've got thyssenkrupp fairly steady this morning. salzgitter also fairly steady norsk hydro arcelormittal. so investors seem to be taking the new tariffs in stride here. investors no doubt trying to understand whether the tariffs in general are going to be a means to an end for the trump administration, 2.0 or an end into themselves. if we look

at what's happened with mexico and canada, it looks as though they are a bit of a means to an end. but with china, we haven't seen either side come to the negotiating table and we have seen the tariffs imposed. so still a lot of debate as to how these tariffs are going to be used more broadly. and of course, the big question is how europe will come into the mix and how the us will target europe, which the trump administration has flagged is coming. the us steel companies in focus as well. you've got u.s. steel corp trading higher this morning. steel dynamics also trading higher, more than 7% apiece. now looking more broadly at us futures, we are at the at this moment looking at a positive start to trade more than 100 points higher indicated for the dow and the nasdaq. this comes after a pullback at the end of last week for wall street. stocks ultimately closed the week lower. the nasdaq lost about half a percent over the course of the week. the dow as well. and the s&p pulled back about a quarter of a percent. so again, fairly muted in terms of the magnitude of the move lower

given all of the movement on the tariffs and all of the threats that remain in place on the tariff front this week, we've got powell's semiannual monetary policy testimony to look forward to more earnings as well, and more data on the macro front. so plenty to play for markets. that is it for street signs. i'm julianna tatelbaum thanks for watching. and worldwide exchange is coming your way next. i got this $1,000 camera for only $41 on dealdash. dealdash.com, online auctions since 2009. this playstation 5 sold for only 50 cents. this ipad pro sold for less than

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>> he's direct. he's absolutely to. >> the point on everything. >> he makes it easy for someone like me to understand how to invest my money properly. >> i've always thought he's an honest broker, somebody that you could really trust. and i thought i would be able to get more insights from joining the club. >> get invested, join the club today. go to cnbc.com, slash join jim. >> president trump ups the ante in his global trade war. he says he'll introduce new 25% tariffs on all steel and aluminum imports into the u.s. as soon as today. and just maybe global reciprocal tariffs later this week. china's retaliatory tariffs on key u.s. exports take effect as beijing reportedly weighs, targeting more major u.s. technology. companies. and. lawmakers and investors remain laser focused on elon musk, his department of government efficiency and the mounting legal challenges in the way of

his mission