that's all for this edition of "dateline." i'm craig melvin. thank you for watching. >> good morning, and welcome to street signs. >> i'm julianna. >> tatelbaum. >> and these are your headlines. heineken raises. >> a. glass for drinks makers in. >> early european trade. >> lining up. >> its best. >> day in more than. >> three and a half decades on the back of. better than. >> expected earnings, ceo. >> dolf van. >> den. >> brink says he's. >> optimistic on. >> the. >> impact of tariffs. >> we keep. >> following things attentively. >> it could. >> have an impact on the aluminum pricing. >> but for. >> this year, at least. >> for 2025, we're almost. fully

hedged, so we don't see. >> an impact there. >> ecb governing. >> council member robert holtzman. >> tells cnbc. >> u.s. tariffs against europe will move both inflation and growth. >> in the wrong. >> direction. but rules out accelerating. >> the pace of rate cuts in response. >> this would not be a good decision because our job. is to. deal with inflation of this. >> growth and. >> the result. >> of it. >> reducing the interest rate in. >> order to. >> initiate a higher. >> growth is not. >> the. >> way how. >> we should work. >> us president donald trump orders government agencies to work with elon musk's department for. government efficiency on. >> cutbacks. >> as musk hits. >> back. >> at. critics of the. >> project. >> the people voted for major government reform, and that's what people are going to get. they're going to get what they voted for. >> and softbank. >> posts a third quarter loss of nearly $2.5. >> billion. >> massively underperforming

expectations as valuations. >> at its vision fund slide. >> a very good. >> morning to you and welcome to the program. >> let's kick off with a look at. european markets. we're about an hour into the trading. >> session and we are in the green. >> stoxx 600. >> the main benchmark. >> up 2/10. >> of a percent. >> adding to yesterday's. >> advance. >> we saw similar gain. >> yesterday for the main benchmark, hitting. >> another intraday. >> high in the session a record intraday high. >> so european. >> stocks continuing. >> to move from strength to strength. >> now in. >> terms of the. >> markets today the. >> bourses this is the split what we're. looking at. >> in europe. you've got. >> the xetra. >> dax up about 3/10. >> of a percent. similar gains for the cac40. >> over in france. >> footsie up 4/10 of a percent. and the ftse 100 here in the uk lagging somewhat but still in the green. >> we are going to now. >> take a look. >> at the.

>> the sectors the sectors. >> leading the gains this morning. we've got food. >> inbev up 1.5%. >> and today it is. >> all about heineken. >> we're going to give you all the detail. >> in just a moment. but that. >> beverage maker bringing. >> optimism to the broader sector. >> and we're. >> seeing a lift across. >> all of the beverage names. >> real estate. >> also doing well. >> up 1%. basic resources. rebounding after suffering some losses on the back of the tariff. concerns that sector up 8/10 of a percent and chemicals also. >> doing well this morning. >> up about. >> 8/10 of. >> a percent. >> on the. >> downside, the laggards. >> in europe we've got oil and gas down about 7/10. >> of a percent. >> health care and industrials. but clearly it. >> is a morning that is tilted to the upside. >> so an. >> overall strong start to trade. >> now let's dive into heineken. >> because. >> this has got a ton of attention. this morning. shares were actually halted in early trade after the company posted a net profit rise of 8.3%. >> for the full year ahead. >> that that. >> was well ahead of analysts. >> expectations and its own guidance. >> the dutch. >> brewer saw beer volumes.

>> rise. >> 1.6% on the year on an organic basis, and. >> announced a ■k71.5. >> billion buyback program. >> over the next two years, you can see. shares up nearly 12%. but look at the where we have come from. >> the stock. >> is down nearly 20% over. >> the last. >> year, so. >> it is really. >> a strong bounce. >> and i would. >> i would assume there. >> is a bit of short covering taking. >> place this morning. >> and that's part of why we're seeing the outsized. >> jump in the stock. >> now. we had a chance to speak to dolf van den brink, the ceo of. >> heineken, and. >> he told us that he's optimistic. >> the company. >> is well insulated. >> from trade tensions. >> beer industry is capital intensive and is very local. so in over 70 countries we have local breweries. with 8,090% local sourcing operated by local people selling to local consumers. >> so as. >> such. it's an industry that's a bit less. susceptible to disruption. >> in international trade, trade flows. >> and on the tariffs. yeah, we like to joke internally. we have green bottles. >> we don't have. crystal bottles. you know, we don't know more than than.

>> you do. we keep. >> following things attentively. >> it could have. >> an impact on the. >> aluminum pricing. >> but for this year at least for. 2025 we're almost fully hedged. >> so we don't see an. >> impact there. but again, we keep following it. but given our footprint and our local for local structure and for us, the impact is at this. moment assessed to be. relatively manageable. >> now let's. >> talk about what's happening. >> in the consumer space. >> space with. >> john cox. >> the head of european consumer equities. >> at kepler cheuvreux. john. thanks for joining. >> us this morning. >> i've got so much i want to get through today around the consumer space. but let me just kick. >> off with the story. >> of. >> the morning. >> and that's heineken. >> the company delivering a strong set of. >> numbers relative to what the. >> market was expecting. >> it seems to. >> me there's a lot of short covering taking place in this. >> stock, but we are seeing. >> a rally across the beverage space today. what's been particularly encouraging about what we heard? >> yeah, i. >> think there's a there's a lot of different things going on, but certainly the consumer space has been heavily shorted over

the last. >> couple of. >> years, a lot of turmoil from what is traditionally been very long term compounders, which were suddenly struggled, and heineken amongst those, all the brewers, all the. >> spirits makers, all. >> the food companies, all of the sort of home and personal care companies as well. and i think what you've seen over the last couple of sessions, heineken today, we saw coca-cola. >> yesterday. >> mcdonald's in the last week or so. maybe, maybe the corner has turned after what has been a pretty dramatic couple of years in the consumer space. now for heineken specifically, obviously very strong cash flow generation, although the buyback was pretty pretty much expected. but certainly the organic revenue growth of 5% ahead of expectations is a positive and hopefully a sign of things to come as we move into 2025, not just for the brewers but also across the consumer staples space. >> well. >> john, that's. >> exactly where i wanted to go next around volumes. >> expect volume. >> volume expectations.

>> for the broader. >> staples space. >> we've got nestle. >> we've got unilever coming. >> out tomorrow. >> and i think one of the key questions. >> speaking to investors. >> is around. >> volume growth and. >> what we're going. >> to see. >> so what is. >> your take on. on where things stand. >> now in terms. >> of that. >> organic growth for the staples? >> i think what you've seen in the. >> last couple of years. >> was that very high price increases, the whole industry put through to offset rising input costs. and at the same time, because they were trying to defend margin, maybe there wasn't a lot of investment in innovation and marketing, etc. and what we saw last year was actually then the pricing disappeared, but there were no volumes. so that's why typically across the industry and consumer staples, you saw pretty poor organic sales growth. now going into this year, we should see a more normalized pricing environment. but in addition, a lot of these guys now are investing more in new product development, bigger, bolder innovations. and at the same time marketing more extensively

than they have. and so hopefully as a result, some of the share losses they've had against private label in the last year or two can be reversed. and we're actually going to see volume growth accelerate as we go through the year. but certainly low income consumers remain under pressure. there's a lot of interest in private labe, and the fmcgs need to get their act together to encourage some of those consumers back into the branded space. >> well. >> so. >> john. >> i guess on. >> the on the positive. then we. may be. in for. >> a restoration. >> of volume growth. >> but then on the flip side. >> i know there's a lot of concern around margins in particular. >> as a couple. >> of the key inputs have seen dramatic price increases. >> over the last year. and i've been. >> looking at cocoa. >> and. >> coffee in particular. cocoa prices hitting a record high. >> in. >> december, coffee prices up nearly 20%. >> in. >> the. >> last couple. >> of weeks. and these are pretty key. >> inputs for. >> some of these. these staples companies. to what extent. >> is that going to.

>> exert margin. >> pressure for the food companies? >> yeah. >> i think i think it will just to come to nestlé, for example, about a third of its portfolio is in coffee and confectionery. you know, i assume they need to put through double digit price increases in those businesses this year, and that's bound to have an impact on volume. and it'd be interesting to see what the company says about that tomorrow. lauren fricsay his first his first full year results as ceo since he was appointed, and something of a surprise move midway through last year. but certainly that pricing is not helping him trying to reboot growth. on the other hand, because of that pricing going through in coffee and chocolate, you may find nestlé's organic sales growth is going to be better than the market anticipates for 2025, but volume growth could be subdued as a result. and then the question is, how does the market view that there has been a lot of pressure on companies where they haven't delivered on

volume, so something to watch tomorrow. >> we've also got unilever. >> coming up. >> tomorrow. >> and unilever has been quite a turnaround. >> story. >> or at least. >> one that investors. >> hope would be a good turnaround story. >> and we've got new. >> management leadership. at unilever. >> in the last year. >> and it seems. >> like. >> investors have become. >> more bullish on unilever. they like. >> the way the company. >> is being run now. >> they've done a lot. >> of change. >> on the. >> portfolio already. >> they're in the process of. >> trying to. >> spin off ice cream. >> what's your take on unilever in. >> terms of where they are. in that turnaround. >> journey. >> and what. >> are. >> you going to. >> be watching most closely in. >> tomorrow's results? >> yeah. >> i think unilever are. further ahead compared to some of the other players in the sector, and you saw that with a pretty decent stock performance last year, one of the better performing stocks in that european consumer staples space, we assume more of the same through this year. what it benefits from is obviously the exposure into the more personal care, its beauty business, its personal care business. these

are growing faster than in the in the food space. in addition, it has that emerging market exposure as well. so, you know, we assume they're going to reiterate the 3 to 5% like for like growth along with a higher margin in 2025. we'll be watching. you know what's happening with the ice cream business. it looks like that's going to be offloaded. and that has accelerated in the last couple of quarters as well. so news on ice cream, that could be pretty positive. and ultimately more and more unilever is just becoming more of a pure play home and personal care company, rather than that mix of personal care home and then a big food business. ultimately, maybe that rest of the food business may go as well, right? >> and that maybe may see some. multiple uplift. >> as a result. >> john. >> lastly, the glp. >> one. >> what is the latest in terms of the impact. >> that these new weight loss drugs. >> are having. >> on food consumption? and in turn, these food. >> companies. >> you know, this is such a big deal. and if you if the food

industry is well aware that the average, you know, somebody's taking glp one is going to be consuming less calories, particularly in things like snacks, salty snacks and baked baked goods, the average basket size is down pretty dramatically for a glp one user. i assume glp one users are already up to around 10% of the us population, and this is the reason why the us market has really been the nadir of the weakness in food over the last year or so. i think that trend is going to spread into europe and elsewhere in the world over the next couple of years. personally, i think the european food companies are better placed. they have healthier portfolios. we actually like danone. half of its business is in specialty dairy, namely protein, dairy and gut health dairy. this these products currently are booming from those glp one users, and i expect that to continue well into this year and for the

foreseeable future. >> thank you so much for sharing. >> your views with us. >> john cox, head. >> of european consumer equity. >> equity research. >> at. kepler cheuvreux. >> now continuing with earnings. >> this morning, siemens energy saw a record order. >> book in the. >> first. >> quarter amid strong demand for its energy equipment. >> the company. >> posted a net profit of ■k7252 million. >> that's almost double expectations. abn amro has posted a 27% drop in fourth quarter profit that represented. >> a modest. >> beat and was supported by rising fees. >> for the year ahead. the dutch bank says it expects net interest. >> income to fall as much as $300. >> million. >> and ahold. delhaize posted. weaker than expected net. >> profit of ■k7380. >> million. >> in the fourth quarter. >> sales for the period came in marginally ahead of. analysts expectations, with the. company saying it has seen volumes recover. >> in the us. >> that stock. >> though down more. >> than 5%. >> this morning here in the uk, barrett redrow has surged. >> to the top of the ftse. >> after announcing. >> it expects annual. earnings to come in toward the top.

>> end. >> of its forecast amid solid. bookings this year. the british home. builder builder announced a 100 million. >> pound. >> buyback, with ceo david thomas highlighting a recovery in demand amid stabilizing political. >> and lending environments. and that stock up. >> more than eight. >> more than 7%, nearly eight. for all the latest market news, you can check out our website. >> we're going to take a quick break, but when we come back we're. going to be talking monetary policy. ecb governing council member robert holtzman says policymakers need to be cautious as trade threats. >> ramp up. >> we'll bring. >> you. >> that conversation. >> and for more reaction out of europe, we'll hear from the former ecb president, jean-claude trichet. >> that's coming. >> up 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 life. three day blinds. >> some people like doing things the hard way, like doing their finances with a spreadsheet instead of using quicken. quicken pulls all your. financial info together in dave's been very excited about saving big with the comcast business 5-year price lock guarantee. five years? -five years. and he's not alone. -high five. it's five years of reliable gig speed internet. five years of advanced securit. five years of a great rate that won't change. it's back. but only for a limited time. high five. five years? -nope. comcast business 5-year price lock guarantee. powering five years of savings. powering possibilities. comcast business.

>> every day. >> i'm reading extensively. >> i'm checking the markets throughout the trading session, working the phones, talking to sources, and doing my own reporting to share insights, information, and all of the details that you need to be able to make money.

>> welcome back to street signs. the american labor market is. >> broadly in. balance and not a source of significant inflationary pressure. >> according. >> to fed chair jay powell, who testified before the senate banking committee tuesday. powell told lawmakers the fed doesn't need to be in a hurry to lower rates. again after the fomc cut at each of its last three policy meetings. powell walked a fine line on the impact of policy coming out of the new trump white house, including tariffs. >> the standard case for free trade and all that logically still makes sense. it didn't work that well. when we have one very large country that doesn't really play by the rules. and in any case, it's not the fed's job to make or comment on tariff policy. we you know, really that's for elected people. and it's not for us to comment ours. ours is to try to react to it in a thoughtful, sensible way and make monetary policy so that we can achieve our mandate.

>> austrian national bank governor and ecb governing council member robert holtzman says policymakers must act carefully, given the threat of trade curbs from the us administration. speaking to cnbc, holtzman said the central. bank should not be focused. >> on boosting. >> growth through rate cuts. >> we have for also. the threat. >> of high inflation, given the changes on tariffs and the result of it. my take is we have to be very cautious because. >> we're choosing. >> rates in order. >> to support growth. is not the way to go. this is what you also framed when you called madame schnabel. she also. >> said it's not the way. >> to support the. >> restructuring with. lower rates. >> how quickly. >> though. >> do you think we. >> need to. >> get back. >> to neutral, even if you're not providing accommodation? just getting back to the neutral rate. >> because conversation. >> i had with madame lagarde in recent weeks, that 1.75% could be the low. >> end of neutral. >> is that a. prospect you. >> see rates getting to soon?

>> i know. >> the range. of relative rates. >> or a. >> neutral rate ranges quite a lot. >> or in. >> some cases it. goes up to 3%, not only to 2.25, which was the restriction, madame lagarde, but there and if we have the three, which is part of the main range, open. 1.75 to 3%. then how to say we have a different discussion there, which. >> means. >> yes, we want to come close to the neutral rate. what exactly is we don't know. and for this reason we use other information as well in order to determine it. what we currently have is some indication in what direction it moves, but it's not the rate on which we base our decision. >> all right, robert. >> really nice to see you. >> again, sir. >> what happened. >> to the robert holtzman? i used to know who was quite a hawk and who was very concerned about all those rate cuts as well, of all those factors that i was over a year ago, robert, we sat outside, we were chatting

in davos as well, of all those factors that led to you being more hawkish, have they dissipated now? >> they have not participated. on the contrary, with the arrival of this threat of tariffs, they reemerged there before they were somewhat dissipated because we looked like. >> moving slowly. >> towards lower rates. what we have now is the threat of higher inflation rates. and for this reason, we have to be careful. >> governor, we've. >> had a lot of. >> discussions with governing council members like yourself about the prospect of a 50 basis point rate reduction that perhaps the ecb is behind the curve. i know you're sounding very hawkish, but not all members see the situation that way. they're very concerned about the growth profile. if you're wrong and if inflation doesn't materialize and growth is a greater. >> concern. >> would you be in favor of a 50 basis point rate reduction this year? >> i think this would not be a good decision because our job is to deal with inflation, not with growth. and the result of it.

reducing the interest rate in order to initiate a higher growth is not the way how we should work and how we are working. >> well. >> we are very fortunate. >> this morning. >> to have jean-claude trichet with us, former governor of the bank of france and former president of the ecb. thank you so much, sir, for joining us this morning. i'm very keen to get your take. >> on. >> the state. >> of play in the eurozone. >> latest data shows that growth is very slow. >> very sluggish in the economic region. very disappointing manufacturing data coming out. >> i'm curious if you've. seen any green shoots that stick out in. >> the eurozone or if it's all. >> pretty downbeat. >> well, as you say. >> growth is very low, obviously, and much lower than in the us. that's absolutely clear. nevertheless, if. >> you. >> want. me to see some kind of rays of hope, if i may, the last pmi for. the euro area, the composite. scene indicates the

first sign of expansion since august last year. so it's very, very miserable. it's 50.2 but it's higher than 50. so i mentioned that en passant. but it is absolutely clear that we still have a growth which is hampered by the environment, which is hampered by the war in ukraine, by our handicap in terms. of the price of energy in comparison with the us and in comparison with the rest of the world. so we have really big, big issues there. still, it seems to me that in terms of growth, we are helped a little bit by the disinflationary process, which is, i would say, going on, and it permits me to say that the central banks on both sides of the atlantic did a very good job in comparison with

what they did a long time ago, in the time of the first oil shock in 1973, when they were practicing benign neglect, they did not practice benign neglect. this time it is rejoicing in a way, because, of course, if you are in a disinflationary process, it helps also domestic demand and growth because you are redistributing, if i may, to your fellow citizens, some kind of purchasing power. >> so no major policy mistake and. >> fair, very fair point that. >> you know, so far the. >> ecb and. >> the. >> fed. >> they you. >> know, they have. kept a handle. >> on things. >> but the european the. >> eurozone. >> excuse me, is sitting here with extremely sluggish growth for all the reasons that you cited. and yes, maybe we're seeing a little bit of. >> hope in the. >> latest pmis. but that. >> is all. >> before the tariffs come. into the picture. and the looming

threat of even more tariffs between the. >> eu and. >> the us. so from europe's perspective, how would you characterize the risks. >> to growth. >> from these tariffs. and then we'll get on to the inflation picture. >> yes of course. >> first tariffs are a killer. obviously they are playing against growth and they are playing against inflation. and for inflation if i may say against price stability. so this is really very very grave. i am appalled by the fact that coming from the united states of america, we have this idea that the trade negotiations are a zero sum game. what you are earning and gaining is lost by the partner, and that is not reflecting the reality in my opinion. so what i would say as regards tariffs and possible

tariff wars is that the europeans should respond to for tack to the other countries concerned, in particular the us. if the war is triggered by the us. so i have to say that we should be on the european side and speaking as a citizen, as determined and when needed, as aggressive as the us might be. that's as simple as that. but i hope very much that after a while, everybody will recognize that the trade between partners that are respecting the rules are a positive sum game. and i echo a little bit what jay powell said in the senate. it seems to me it was more or less the message. even if he said we have no say. of course, in the trade negotiation, which is clearly the case of all the

central banks. >> in terms of the inflation. >> impact of these, you know, the ongoing trade war. >> how do you think about the consequences for europe? you know, on the one hand, you could argue that this raises inflationary pressure. if we see. a rise in. >> prices across the globe as a. >> result of these tariffs coming into play. but on the flip side, for europe specifically, if we see other countries divert goods, for. >> example, that would have ended up in the us, they come. to europe that could have a. >> disinflationary impact. >> on prices. >> well, i mean, it's a very complicated situation. we don't know yet. of course, what are likely to be decided, what is likely to be decided by the united states? i would only say that in any case, it's bad because, again, as i said, it's against growth and it's against the appropriate level of price

stability. and let me remind all of us that we have the same definition of price stability on both sides of the atlantic, namely 2% in the medium run, which is something which is very, very important. i expect, of course, the central banks, even in an environment which will be a little bit more difficult to stick to this definition. and by the way, when you look at the reaction of our fellow citizens vis a vis price stability, clearly they are incredibly attached to price stability. you can interpret the changes, the political changes that happened in the us and in many countries, many advanced economies, countries and also developing countries as a reaction against the hump of inflation that we had three years ago. so again, central banks in their job to deliver price stability, whatever happens, whatever are the decisions taken as regards tariffs is backed by our fellow citizens. it's a very important.

central banks are backed on both sides of the atlantic by their fellow citizens. >> sir. >> we are going to have. >> to leave the conversation there. we could talk for. >> for many, much. >> more time. >> but we'll hopefully have you on again. >> jean-claude trichet. >> former governor. >> of bank of france and former president of the ecb. let's get out now. >> to arjun. >> who's in paris. for a look at what's. >> coming up next hour. good morning. >> good morning julianna. >> i'll be speaking to one of europe's most prominent entrepreneurs turned investor. >> about where he's putting his money in tech in 2025. stay tuned. ah, these bills are crazy. she has no idea she's sitting on a goldmine. well she doesn't know that if she owns a life insurance policy of $100,000 or more she can sell all or part of it to coventry for cash. even a term policy. even

a term policy? even a term policy! find out if you're sitting on a goldmine. call coventry direct today at the number on your screen, or visit coventrydirect.com. >> waking moment. what we do and how we do it. >> but the. >> amount of light we need can change in an instant. >> and when it. >> does. >> you can control it. >> three day blinds. >> find the. light for your life. >> visit three day blinds.com to >> visit three day blinds.com to get started.

a sleep number® smart bed is perfect for couples the climate360® smart bed is the only bed that cools and warms on each side and all our smart beds adjust the firmness for each of you. and now, save 50% on the new sleep number® limited edition smart bed. shop a sleep number® store near you. (vo) if you're only maxing out a 401k, sleep number® limited edition smart bed. you can add a robinhood ira with a 3% contribution boost. (nasa pilot vo) roger that. (vo) robinhood gold gives you an instant 3% match on your annual ira contributions. ♪ on his company's latest results. squawk box today, 6 a.m. eastern on cnbc. >> welcome back to street signs. >> i'm julianna tatelbaum, and

these are your headlines. heineken raises a glass for drink makers in early european trade, lining up its best day in more than three and a half decades on the back of better than expected earnings. ceo dolf van den brink says he's optimistic on the impact of tariffs. >> we keep. >> following things attentively. >> it could. >> have an impact on the. >> aluminum pricing. >> but for this year, at least for 2025. >> we are. >> almost fully. >> hedged. >> so we don't see an. >> impact there. >> tariffs dominate the conversation as we get the views of some of europe's leading central bank voices amid rising trade tensions. >> we have for. also the threat of higher inflation, given the changes on tariffs and the result of it. my take is we have to be very cautious. >> rates. >> are a killer. obviously they are playing against growth and they are playing against inflation. and for inflation. >> and us president donald trump orders government agencies to

work with elon musk's department for government efficiency on cutbacks. as musk hits back at critics of the project. >> the people. >> voted. >> for major government reform, and that's what people are going to get. they're going to get what they voted for. >> and softbank posts. >> a third quarter loss of nearly $2.5. >> billion. >> massively underperforming expectations as valuations at its vision fund slide. well european equity markets. >> this morning holding. >> up pretty well. we are. >> seeing another. day of green at least to start. >> the trading session. ftse 100 up eight basis points. >> you got the. >> xetra. dax up 3/10 of a percent. the cac40 and the ftse mid. obviously the magnitude. >> of those. >> moves are fairly contained. >> but it. >> is the direction of. >> travel that's worth noting. >> we have. >> been advancing. >> for weeks now. >> the stoxx 600. >> yesterday the. >> main benchmark added. about 0.2%. >> hitting another. record intraday high. and this. morning

we are. >> just continuing. >> to move higher. you've got. >> heineken performing. >> very well this morning up about 12%. lifting the drink space. that is the sector. >> to watch. >> this morning now stateside. it is a. >> slightly different picture. >> we're looking. >> at a pullback. >> for wall. >> street fairly. >> contained as well. >> so fairly muted. >> trade on both sides of the atlantic there. no doubt a bit of a holding pattern with that us. >> cpi print. >> due to be released today. >> and it comes at a time when inflation. >> concerns have resurged. >> amid these tariffs. >> and higher than. expected wage growth in january. so that number going to be very closely watched this afternoon. >> right now. we're looking. >> at about a 80 point. >> drop at the dow, the nasdaq and the s&p also. looking to pull back at. >> the open. >> president trump. >> meanwhile, has ordered federal agencies. >> to. cooperate with elon. >> musk's department of government efficiency. >> to fight ways to shrink. >> the size of the. >> federal labor. >> force through. >> identifying workers who can be laid off. >> and functions. >> that. >> can be eliminated. the executive. order also limits federal recruitment once trump's hiring. >> freeze ends, with. agencies

allowed to hire. only one employee. >> for every four. >> who depart law enforcement, national security and immigration enforcement roles. >> are exempt. >> from the curbs. >> appearing alongside musk and his son in the oval. >> office, president trump made a series of. claims that federal funds were being misused. >> without offering any. >> direct evidence. assertions which cnbc is not able. to verify. >> take a listen. >> billions and billions of dollars in waste, fraud and abuse. and i. >> think it's very important. >> and that's one of the reasons. >> i got elected. >> i said we're going to do that. nobody had any idea it was that bad, that sick and. that corrupt. >> and it seems hard. >> to believe. >> that judges want to try and stop us from. >> looking for corruption. >> especially when we found hundreds. >> of millions. >> of. >> dollars worth much more than that in just a short. >> period of time. >> we want. >> to weed. >> out the corruption. >> elon musk used the signing to hit back at critics of his project. >> the people voted. for major

government reform. >> there should be no doubt about that. >> that was on the campaign. the president spoke about that. >> at every rally. >> the people voted. >> for major government. >> reform. >> and that's what the people. >> are. >> going to get. they're going to get what they voted for. >> quite defensive remarks from elon musk there. now, openai ceo sam altman. >> has told. staff in an internal memo seen by cnbc. >> that the. >> company has. >> not received an official offer from elon musk. for the. >> purchase of its. nonprofit arm. it comes. >> after news broke that a consortium led by musk is vying to buy control of openai for just under $100 billion. >> in the memo, altman says openai. >> is. >> structured so that no single individual can. >> take control of the company. >> adding that musk's offer. >> was aimed. at weakening it. >> arjun spoke to sam altman. >> at the ai action summit in paris, where he claimed the motivation behind musk's bid was purely to slow down a competitor. >> musk bid. >> for openai. >> how serious are you taking it? >> not particularly. >> not particularly. >> why do you think he's doing this? >> to slow down a competitor. >> and stargate.

>> do you have the funding? >> i'm not the one who tweeted funding secured. i just actually try to show up and, you know, build the thing. >> just a quick one. end game. what is the end game? just a quick musk. >> i don't know i'm curious. i think it's to slow down a competitor and try to catch up with his thing, but i don't really know. >> yeah, but you're. >> doing. >> well, right? >> to the degree anybody does. yeah. >> the us and uk have refused to sign a communique at the paris i action summit, calling for the open and. >> ethical development. >> of artificial intelligence. >> the british government said it declined. >> over national security. >> and global governance concerns. while us vice. >> president jd. >> vance has. told the audience. earlier on tuesday. >> that international regimes must, quote, foster the creation of. >> ai rather than strangle it. you would have heard that. >> yesterday if you were watching. >> street signs we heard directly from jd vance. now, around 60 countries have signed the communique, including france, india and china. >> arjun joins us now. >> with a guest from paris. arjun.

>> hi, giuliana. i told. >> you we were going to speak to one. >> of. >> europe's most prominent. >> entrepreneurs turned investors. let me introduce him. >> taavet hinrikus. >> henriques. >> who is the co founder at wise and. >> a. >> partner at plural. david. let's talk. >> about ai then. >> we're trying to. >> understand here. >> where the investment. >> case lies. >> a lot. >> of. >> the attention, a. >> lot of the capital. >> a lot. of the high valuations. >> have gone into. >> those foundational. model companies. >> but are. >> we missing something? >> is the value, as other investors have told me in that application layer? next. >> i'm very excited about what i'm seeing. whereas the most ambitious entrepreneurs are building ai applications. and we look at companies, for example, like helsinki, using ai to build real world defense systems. looking at proxima, using ai to accelerate the build out of fusion power power plants. and additionally, there are a bunch of other european companies in asia, 11 labs, maybe liverpool, who are using ai to generate voice audio code. so i think there is so much excitement about the applications that are being built. maybe there are

more headlines going to the models, but i think the change around the models is happening so rapidly, and companies coming up with ten x better models, and i think the carpet may have been maybe may get pulled out. but application, i think we're seeing real value being created by lots of entrepreneurs. >> is that what you think the profitability for ai businesses will be? because when you look at the models, there's a lot of debate about whether they will become commoditized, whether open weight or open source models eat the lunch of some of those closed. >> models as well. >> i imagine that on the model side, we're going to see probably both. we'll see a lot of open source solutions. there will be proprietary ones as well. i probably still be more bullish on on the profits in the long term being on the application side, because i think these can be more defensible with proprietary data. and i think we're seeing lots of progress there as well. >> fascinating. what has deep seek done to your investment thesis, if anything? because the excitement around deep seek, we saw a knee jerk reaction in the public markets, and the debate

was about whether this means we're overspending on ai with all these multi-billion dollar infrastructure projects, and whether actually some of the valuations these model companies have garnered should be called into question. has it done anything to change your investment thesis? >> i have been a fan of ten x better products for a very long time, and i think the way to look at deep tech is maybe it's a ten x advantage on the model side, which just shows how quickly innovation is happening, which means that the business cases are much harder to make on the model side, the kind of. hence why we spoke about the applications before that i think the applications could be in a much more sustainable and defensible position today. >> david. >> before this interview, we were sort of debating the. geopolitics of tech. and during this ai summit over the past few days, you know, the geopolitics, i think was laid bare. the us and the uk didn't sign up to this ai communique at the summit. we heard from us vice president jd vance, who sounded very critical on europe's regulatory approach, etc. what

does the geopolitics mean as you think about investing in tech, given it feels that there are more and more silos being created and each region or country needs to sort of fend for itself. >> i mean, we are living in a brave new world. and, you know, maybe when even a year ago, we could think about china being kind of getting getting separated on an island. i think maybe now we have to think about us. there is europe, there is china, and we're going to need defense companies in every country. we're going to need foundational models. we're going to need data centers. so i think that for geopolitical reasons and for resilience, we will need to build up a lot of the same things in europe, which maybe a year ago we didn't really think so. but i think it's a great use of also the funding that's been announced as the summit here. so, you know, i would assume that we will need to build more of these things, kind of a duplicates in some ways just to give us a resilience. >> it's almost an open eye for europe, palantir and for europe, this kind of thing. >> and i think we're seeing that

happening. i mean, i agree with you. >> yeah. what is it? and for your investment then, you know, you are you are focusing on a lot of european companies, companies as well. does that create new opportunities as you see it. so when you look at some of these ai companies, perhaps in a world where there was closer collaboration between the us and europe, perhaps that company wouldn't have been as prominent. but now, given the situation you're laying out, actually there's more opportunity there. >> and we are already seeing it. i mean, for example, with helsinki building a defense ai company, there is probably a us equivalent of this same thing. we're looking at proximus building a fusion energy power plant through fusion energy companies in the us. proxima being we believe the best technology using the stellarator approach is going to be a european champion, building a global and needed product. so i think we're going to see this happening in more and more of the kind of more fundamental and more in areas which need a lot of resilience. >> in terms of valuations as an investor. you've seen the model side of the equation and we've

seen astronomical valuations there. are you seeing the same hype and valuations happening in the areas you're investing in on the ai application side? >> i've seen a few cycles happen in the tech world. and you know, every time in a cycle you get some companies that are showing amazing traction and are able to generate these huge headline valuations. i think what we really care more about is the valuations we're going to be seeing in five, ten years from now. oftentimes, we see some of these companies may run a little bit ahead. they're going to correct later. so it's just a little bit too early to say. >> and in terms of europe's position in this we've spoken about the geopolitics of it all. but europe has had its own challenges. and there's a continued debate whether there is too much regulation, whether europe has invested in enough infrastructure. one of the things that it seemed that president macron of france was trying to do during the summit was shake off this image as europe, as anti innovative over regulatory. but as an entrepreneur and as an investor.

are there still some big challenges europe's need to overcome, and are there some things that need to change for europe to really compete in the ai realm on a global stage? >> i think when it comes to the regulation, you know, we are seeing a changing kind of landscape. and, you know, i think it was quite symbolic to see that summit has gone from ai safety to more ai acceleration. and what i wish is that we're going to see a more level playing field across the world. you know, if the us is dealing with ripping out regulation and vance is talking about opportunity in ai, then in europe, we're not going to go that far. if we add more regulation on top of it. so i think europe has to think about this as how do we create a level playing field for the great european entrepreneurs to compete? you know, if we look at if we look at the ingredients, we have a lot of talent in europe. there is a huge portion of ai researchers that are coming from europe, and we're seeing more and more companies being built here. we just need to make sure that there's a level playing field that we do not shoot ourselves in the foot.

>> yeah, just just a final one for me. david, on the use of ai. there is this debate about promise. i won't get into this, but now we're here scaling laws and how ai is going to scale, how it's going to become more efficient. and actually whether that means it's going to become more ubiquitous, more used across consumers, across enterprise. how are you looking at that journey right now? is are we at a point where you're going to see sort of exponential growth of the use of ai, or is there still a lot of challenges in terms of implementation in businesses and for consumers as well? >> i think we are definitely going to see accelerated usage of ai across all areas. i think sometimes, you know, the hype goes a little bit ahead, but if we're looking at user numbers, i think they are growing in a in a very nice way. i'm actually excited about deep tech, which is making it cheaper. you know, there's also like many new spin now about people using $400 or $50 to train a model. so i think if this becomes cheaper, there's going to be a lot more a lot more usage. and that's actually a good thing. that's a good

thing for the for everyone. and it's going to help the entrepreneurs. we're going to we're going to have more impact this way. >> and does that mean more infrastructure and compute will be required? because this is a big question. >> i would not bet that we need less infrastructure and compute how quickly we need ten x more, i don't know. >> david, thanks so much for your insight there. fascinating, fascinating conversation there into the state of ai and how we need to start thinking even more now across geopolitical lines when it comes to technology. that was taavet hinrikus, the co-founder of wyse and a partner at plural for now. juliana, back to you. >> thank you so much for that interview. for more on europe's ai. >> ambitions, do check out arjun's. >> article on cnbc.com. for now, we'll. >> take a. >> quick break. >> stay with us. home. >> the place. >> where you.

>> create those special moments. >> we celebrate. >> the home. >> and the way you live. >> in it. >> at three day. >> blinds. >> we help you create. >> that special place. >> and because we. >> know you're. >> busy, we. >> bring the showroom to you at your convenience and provide. >> a. >> design expert to help. >> you find the perfect. >> solution that fits your. >> style and budget. >> three day blinds. you'll love the treatment. >> call or take your business from launch to legendary with shopify. sell more with the world's best converting checkout. turn analytics into opportunities so you can scale further faster. take your business to a whole new level. switch to shopify. start your free trial today. for all those making it big out there... ...shouldn't your mobile service be able to keep up with you? get wifi speeds up to a gig at home and on the go. introducing powerboost, only from xfinity mobile. now that's big. xfinity internet customers, cut your mobile bill in half vs. t-mobile, verizon, and at&t for your first year.

plus, ask how to get the new samsung galaxy s25+ on us. >> we created the club to give investors more confidence in their investing decisions. >> it does teach you. >> to learn from your mistakes and basically to learn as you go. that's why i think. >> it's such a. >> wonderful teaching tool. >> go to cnbc.com slash join jim.

>> welcome back. >> to street signs. as we approach the. end of the program. >> here are. >> four things to get you. >> up to. >> speed ahead of the wall street open. >> traders are closely watching today's cpi print stateside, with the annual figure seen holding steady from january. >> fed chair jerome. >> powell heads. >> back to the hill for a second. >> day of testimony, after signaling the. >> central bank isn't in. >> a rush to cut rates. >> earnings season. >> continues. >> with reddit, cisco. >> and robinhood among the. >> names reporting. >> today. >> and we'll get a check on the crude markets with opec set to release its monthly oil market report this afternoon. openai sparked a frenzy in the artificial intelligence space with. >> others trying to. >> catch up. but it's not. >> the only. >> player in the game. the uae's al minister told cnbc. ai minister excuse. >> me, told cnbc. >> the minister also. >> gave. >> his views on what the surprise bid from elon musk and his consortium for the company says about the state of the

global ai race. take a listen. >> i don't know how. >> elon feels. >> i can't. >> comment on his. >> sentiment, but. >> you have to think about it. >> he was the. >> major shareholder. >> for $50. >> million at one point of time, so i'm not sure how he feels, but i'd love to ask him about that. how do you think the battle. >> for openai is going. >> to play out? >> you could. >> argue that. >> this is. >> probably the most. >> important strategic artificial. >> intelligence asset. globally today. >> as it. >> stands. >> how does. >> this battle. >> between musk. >> and altman end. >> in your view? >> so i. >> don't think that the only conversation. >> we need. >> to be having is openai. >> so even. >> if you look at, for example, today, the potential of openai that people are talking about is the potential that it has to disrupt. >> google and. >> google search. >> if you look. >> at internet traffic. >> google is at least. >> if i'm not mistaken. 12 or 13 times that of openai as it currently. >> stands. >> maybe even more. >> and so. >> there's still a long way to go. >> and i don't think. >> google is going. >> to just sit there and. >> wait for it to happen. i

think. they're going to innovate. i think they're going to iterate, they're going to improve. so it's a bit early. >> what openai. >> and chatgpt was able to do that was. able to spark a sort of frenzy that others are trying to catch up right. >> now, or pivot. >> towards what they were able to do. >> and you see, the new. >> reasoning models are actually quite impressive. and the. deep research models as well, that openai has announced are actually quite impressive. >> but the. >> time to. >> emulate and. >> deploy something. >> similar has. been reduced drastically. >> so i. >> don't know how long this advantage is going to be maintained now. you know. sometimes when we ask. >> these. >> questions. >> we identify openai as the only player. i don't think they are the only player. i think we will have emergence of other companies that are going to be as important, and especially in very specific domains. >> softbank group posted a net loss of. >> $2.4 billion in the third quarter. weighed down by. >> declining valuations at its vision fund. the investment. >> arm posted a net. >> loss after two consecutive

quarters of profit. the japanese. >> conglomerate has recently. >> expanded its investments into. >> ai, reportedly in talks to invest up. to $40. >> billion into openai, with. >> part of that funding expected to be used. for openai's commitment. >> to stargate. >> according to cnbc sources. >> let's get back out to arjun raj. softbank. it feels like this. morning the focus is not necessarily on the numbers themselves, but still. around how it. >> plans to fund. >> these investments. >> into ai, how it plans to fund. >> its involvement in stargate. >> do we have. >> any more color? >> yeah, i mean, that's such a key question at the moment that investors are pondering, because there is a lot of talk about whether softbank is going to have to raise more capital, issue more debt, or potentially sell down some of its stakes in, you know, companies like arm, which it's still the majority owner. and of course, the problem with that is if it signals any selling of arm, that could reduce the pressure or put pressure on arm shares, which could reduce softbank's value in it as well. so lots of questions there. however, you have the cfo, yoshimitsu goto, speaking

this morning, and he was saying that the equity contribution to stargate is split between four partners. so the burden won't be so great. they're trying to play down some of the fears around softbank having to raise capital or issue more debt as well. he says in the project finance, the amount of equity required depends on the project. but it was always be the minority. and stargate will consist of a series of projects as well. and for each of these we will contribute equity and lead the financing for the remainder. so it's trying to say this is not just all in one go. we're going to throw in all this capital. this is project by project, depending on what needs to be done and where that project is. so that's really what softbank's position is at the moment as it relates to stargate. of course, i think there's questions around the investment and raising that capital, and where that money is coming from will continue for the near future. >> raj, thanks for the color on. >> what's happening at softbank now. let's talk about what's going on in d.c. president trump has ordered. >> federal agencies. >> to cooperate. with elon musk's department of government efficiency to. find ways to shrink the size of the federal

labor force through identifying. >> workers who can be. >> laid off. >> and. >> functions that could be eliminated. let's get out to alice barr, who joins us now with more on this developing story. alice, i think this has a lot of people on edge, this new communication from the president. >> and from. >> elon musk. what agencies are in focus and what is the message for workers at those agencies? >> yeah, giuliana. >> this has been kind of a steady march. across agencies. >> within the federal. government where elon. >> musk and his department of government. >> efficiency have been going in and making really massive cuts in a number of cases. >> and what president trump has indicated. >> is that the next up in the. crosshairs are going to. >> be the department of education and the department of. >> defense. >> the department of education. >> president trump long said. >> on the campaign trail that he actually wanted. >> to get rid of. and there's been. >> some. >> reporting that that could be something his. administration is moving toward and moving. education decisions back to.

>> the states. >> the department of defense. >> certainly is. >> an area. >> where president trump has. not indicated. >> a lot. >> of. >> desire to pull back. >> in the past. so it will be interesting to see where elon musk. and his team may. >> say that they're finding. >> fraud and waste and abuse, which. >> is. >> what they've. >> been saying across. other agencies, and how. >> the president. >> and republican members. >> of congress may. >> respond to cuts, particularly to that. >> agency, the department. >> of defense. >> in terms of the response. give us a little bit more color on what what what congress is saying about this and what we can expect in terms of a reaction from the democrats. >> yeah. >> democrats have been trying to sort of sharpen up. >> their response and come up with a means of trying to slow the. >> roll. >> basically, of. >> the. >> trump administration as it's been going agency by agency. they've talked about trying to

set up sort. >> of a. >> streamlined process in order to get complaints up to the court system. that's been really the main means of trying to throw up roadblocks. >> and there. >> have been a number of successful court cases, successful, at least. thus far, that president trump has been objecting about. he, in fact, in the oval office yesterday said that he is going to abide by court rulings and appeal. but he also noted. >> that he thought it was. >> time. >> to take a look at some of these. >> judges more closely, that he is. certainly frustrated with the fact that, for. >> instance. >> an appeals court yesterday. rejected the trump administration's efforts to reinstate a partial funding freeze of federal worker buyout program is on hold. >> so a lot of what democrats have been doing to. >> try to. push back. >> has been. >> through the means of trying to draw attention to the courts and to slow things down that way. republicans. >> for the most part. have said that they think this. >> is what the american people. >> voted for. >> to have major changes to downsizing the government. and

you haven't heard a lot of vocal opposition from republicans thus far. again, things like. >> the defense department. >> could potentially tip that. >> alice, at very similar message to what we. >> heard from elon. musk in the oval office yesterday. >> thank you so much for giving us the latest. >> we're keeping. >> an eye on. >> that story. >> here in europe. we'll give you a last check on european. >> markets. >> before you. >> hand you over. >> to our colleague stateside. we're holding on to those. >> early gains. green across. >> the board. you got the. >> xetra dax. >> up 3/10. >> of a percent. similar gains. >> over in. >> france u.s. futures. >> are still in the red. you've got the dow looking to pull back about 70 points at the open. the nasdaq and the s&p also looking to open weaker. >> all eyes. >> on that u.s. cpi report due out later this afternoon. but that is it for street signs i'm julianna tatelbaum. worldwide exchange. exchange. >> is up next. (♪♪) now for something you can both agree on a sleep number® smart bed is perfectfor couples the climate360® smart bed is the only bed that cools and warms on each side

and all our smart beds adjust the firmness for each of you. let's agree to agree on better sleep. and now, save 50% on the new sleep number® limited edition smart bed. plus, free home delivery and 0% interest for 48 months. shop now. to your door for just $0.87 in less than two minutes. do this first, scan the qr code to go to get friday plans.com. then you select if you need generic viagra or cialis, the quantity you need and the dosage. i'll pick 100 milligram thank you very much. and then their system will see if you qualify. give it a second to find the best deals. and boom look at that $0.87 for each 100 milligram generic viagra tablet

20mg cialis is the same price. the prescription and shipping are free. scan the qr code to go to get friday plans.com and see for yourself. don't wait. scan the qr code or go to get frida ah, these bills are crazy. she has no idea she's sitting on a goldmine. well she doesn't know that if she owns a life insurance policy of $100,000 or more she can sell all or part of it to coventry for cash. even a term policy. even a term policy? even a term policy! find out if you're sitting on a goldmine. call coventry direct today at the number on your screen, or visit coventrydirect.com.

>> as a. >> fan. >> when you see this, it's all. >> about. >> the numbers. >> we know he wants to hold on

to the nba. the question really is how much more will he have to pay? >> a lot of the revenue streams are guaranteed. >> team values continuing to soar. >> the countdown is on. cnbc sport. official nba team valuations revealed friday in squawk box. >> it is fabian. >> here at cnbc global headquarters. welcome to worldwide exchange. >> here is your five and five. >> jay powell doubles down on the fed. pause. we look at. >> the impact. >> on wall street. >> we do not need to be in a hurry to adjust our policy stance. >> investors are now. >> focusing on day two. >> of powell's. >> testimony with. >> the. >> latest inflation. >> report before the open. >> in washington. elon musk joins president trump. >> defending the department of. >> government efficiency. >> the people voted. >> for major government reform. there should be no doubt. >> about that. >> thatas