>> good morning everybody. >> welcome to squawk box right here on cnbc. >> we're live. >> from the. nasdaq market site in times square. i'm becky quick along with joe kernan and andrew ross sorkin. snowy out. we made it in. it's okay. things are easing down a little bit. only a couple of inches here and north of here. down in washington dc, almost six inches. so the snow is impacting things on the northeast here today. >> it's been. >> snowy this. >> year. >> but we haven't had. >> the. >> we haven't had snow like. >> this in a while. we haven't had the foot and have it. >> no not in boston. boston is having a snow day. >> she was. >> yeah. d.c. we had almost. >> six inches. >> yeah. so we're watching that pretty closely. and there's. >> times square. >> nice picture of things. >> it's warm. >> and cozy inside, though. and the us equity futures this morning look like it's shaping up like a mixed picture so far.

that's the same story we saw yesterday. a mixed bag between what you got with the close the dow this morning indicated off by close to 45 points. s&p futures down by about three. the nasdaq indicated up by about 13. yesterday the s&p was up for the second day in a row. the nasdaq was down for the second day in a row. we did see some small gains that were eked out for both the dow and the s&p 500. nasdaq saw just a slight decline. we're also watching interest. >> rates after this comment. >> by fed chair jay powell and his congressional testimony yesterday. >> with our policy stance now significantly less restricted than it, restrictive than it had been and the economy remaining strong. we do not need to be in a hurry to adjust our policy stance. >> no hurry. >> means that treasury yields. >> rose this. >> morning, the ten year sitting at 453. the two year is. >> at 429. jay powell went out of his way to really just explain that we're not going to move down anytime soon. we're not going to move up anytime

soon. and we want to watch this very closely to make sure that we are monitoring both of their mandates that they have to. it seemed like there was some extra language kind of added in almost interest rates. >> for dummies. >> to kind of slow. >> things, maybe on the. >> political expecting. >> a little bit. >> of political pressure. but we'll be watching day to day. we get the cpi today and that's going to. >> give us that indicator. >> those are. >> the data. >> points that that can give all of. >> us some. >> insight. >> some. >> idea into whether are we more. >> at risk of an eventual. >> slowdown or. >> more at risk of. resurgent inflation? >> and if inflation numbers come in as they expected, i think up 3.1%, then you're probably talking about the slow slowing of progression, at. >> least in. >> terms of trying to get it back to the 2% target. so we'll see what happens as we get. >> it feels like the way we're thinking. and the. >> way the. >> economy, we're. >> all in this sort. >> of period. >> between administration. where we're. >> we're trying. >> to find our footing. what does all this. >> mean. >> this crazy, you. >> know, all the.

>> the action coming from. >> from. >> the trump administration and. >> the first 100 days. >> very interesting. >> piece in the journal. i thought that. >> really. >> crystallized exactly what it's not a constitutional. >> crisis. >> as other presidents. >> have taken some. >> similar measures. >> maybe not. >> to the same extent. >> but. >> you know. >> president obama at one point said. >> sue me if. >> you don't. >> like what i'm doing. presidents do what they want. but classifying. >> them into three groups. >> stuff that he's. >> definitely probably able to do, stuff that's a little bit questionable and stuff that is clearly stuff that is clearly against the law that he wants. >> he wants to be revisited. >> to the supreme court because. >> he. >> thinks the original. >> cases were. wrong in the first. >> place, but. >> it is aggressive. >> there's no doubt. >> but i. >> think we're. >> like rudderless right now. >> i don't know. >> what i don't know. >> are you bullish? i don't. >> know if it's. >> no, i feel rudderless. >> i don't know about. >> the economy, the. >> stock. >> market. >> the economy. i don't know. >> whether we're we're ready.

>> for a slowdown. >> or i don't. >> know how tariffs are going to affect things. i don't know how government all. >> the cuts in government. >> spending. >> i. don't know whether. >> that slows the economy. i don't. >> know whether all. the deregulation is going to give. a is. >> going. >> to spring. >> load the economy. i don't know whether tariffs are going. >> to cause inflation. >> i don't. >> know if inflation was already still. >> ready to come back. >> basically you're like jay powell at this point. we are data dependent. we are. >> data. dependent every day. and we. >> haven't gotten any data. >> no really. >> at all. this is look this isn't. >> even a clear trump. >> administration number because we're looking at january's. >> numbers, right. >> trump didn't come in until january 20th. >> but we do know we're. >> at 6100 basically. >> right. or just. >> beneath it on. >> the s&p. so nothing's happened to give. >> us any clarity there. the ten. >> year i. >> mean 453 yeah. >> and that. >> was like oh wow. >> that treasury. >> secretary would. >> like us to start watching the treasury notes, maybe as a, as a report card for. >> the administration too. >> but this. >> number today is going to. >> be important. >> tomorrow. >> this number will be. >> i will also be pretty important and. >> we'll see where. >> we go from there. it's

interesting. we have seen presidents who have tried to pretty. >> aggressively cut things before. >> ronald reagan wanted to, but he didn't have one house of congress. he couldn't do it as effectively. don rumsfeld wanted to do this. >> when. >> he came in as a defense. >> a defense wanted. >> to go into the pentagon and really cut into things. but then nine over 11 came along and. >> that kind. >> of got brushed away, too, right? >> meantime. >> talking about cutting. >> things. >> let's talk. >> about the guy. >> who's in charge. >> well. >> he's. >> not technically in charge of cutting things. he's technically in. charge of finding the things to. >> cut president. trump signing executive orders in the oval office yesterday. >> and he was. accompanied by elon. musk and his son. imagine you've seen the pictures, if not the video. >> president directing agencies to. work with musk, doge department. >> to slash. >> their workforces. >> and limit hiring to essential positions, according to the white house. fact sheet, agencies are going to be permitted to hire no more than one. >> employee for every four. >> workers leaving the government. that's with exceptions made for law

enforcement, national. >> security. >> immigration and public safety roles. now, trump and musk spoke to reporters about the. >> cuts to. >> government 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. >> it's not. >> optional for us to sit to reduce the. federal expenses. >> it's essential. >> it's essential for america to remain solvent as a. >> country. >> and it's essential for america to have the resources necessary to provide. >> things to its citizens. >> and not simply. >> be servicing vast amounts. >> of debt. >> two men also spoke about transparency and accountability. they were asked. about musk's

doge department. >> all of our actions are are fully public, so if you see anything you say, like, wait a second. hey. >> you. >> know that doesn't that seems like maybe. >> that's. >> you know, there's a conflict there. >> i it's not like people are going to be. >> shy about saying that. >> transparency is what builds trust. >> not simply somebody. >> asserting trust. >> it's not somebody saying they're trustworthy, but transparency. >> so you can see everything that's. >> going on. >> and you can. >> see. >> am. i doing something that. >> benefits one of my companies. >> or not? >> it's totally obvious. >> and we thought. >> that we. would not. >> let him do that. segment or look in. that area. >> if we. >> thought there was a lack of transparency or a conflict of interest. and we watched that also. >> i also talked about. how he said, look, i'm going to make mistakes. i don't know if you saw that part of the part of the interview. he said, nobody bats a thousand. >> but it. >> was asked in the context of something that actually then went viral. and i think this goes to the questions about social media and everything else where. >> i didn't think it did the

condom. >> well, what was. >> interesting, because i agreed with him that. >> why. >> number one, i have no idea what $50 million worth of condoms looks like. that is such a big person. that's a big number. so it. >> didn't go. >> to gaza. >> it went to mozambique. and but but i thought that the core like finding. >> was what. >> what are we. >> sending $50 million worth of condoms anywhere for. and i guess it was that. >> it was for. >> hiv in mozambique, but it wasn't. for. >> it wasn't saying. >> to hamas. no, but i'm saying we can we can debate whether they should be sending them or not. that's a different question. >> but it's. >> a lot. >> 50 i. >> can't imagine. >> i'm not i'm not i'm. >> not here to defend. >> the. >> the a lot of condoms. >> i'm just suggesting that when somebody of his influence says something that. is as. >> factually because it. >> was originally put in the context of. bombs of, of gaza. >> of, of gaza. >> in palestine, it was in the

context of hamas. it was in the context of israel, by the way. it created all sorts of rumors and speculation that the united states was trying to control the population of the palestinians, by the way, that's that's what happened as a result of all this. and so when you get things that are that incendiary and that wrong in the social media space, even if you ultimately 2 or 3 days later or even ten hours later land up in the community notes. >> it doesn't shut off. >> it doesn't shut off this. but this is the world we. >> live in. and we've we've seen conspiracy theories that are crazy, and we've seen conspiracy theories that eventually came true. >> what they said. >> yesterday in the oval office so sound it's hard to disagree with anything that they were saying. i wish that was the level of discourse that was there all the time. elon's right. if you disagree. >> with him. >> you bring it up. >> but i think that's what they're trying for. >> but sometimes when you disagree. and you bring. >> it up, you get called an idiot immediately. >> if this were. >> a more civilized. >> discourse all the time like that, then of course this is

exactly what we should be. >> well, it's. >> a work in progress. >> i noticed that. >> it also just say one other thing about this. most of the stuff that we're finding out about doge and what they're doing, we're finding out because reporters, reporters, journalists are actually doing the work. that's how this was found out. >> that's the. >> mozambique thing. >> yeah, but there's lots of examples of what's been happening inside doge that's happened as a result of journalists. at the same time that those journalists, i'm sorry to say, are have been targeted in some cases, either by the administration or by musk himself. and so that that to me and i feel totally comfortable saying this, that that's, that's. >> that's a. >> problem. >> civilized discourse. >> if you could have civilized discourse and transparency. where this was exactly what was. >> happening. >> that's great. >> what they said yesterday. i don't. >> disagree with. >> any of it. >> i think that. >> that's what. >> the. >> reason the press exists. >> is for things like this. >> i just wish it was applied evenly. >> and that. >> the press hadn't taken four. >> years off. i've said. >> that. >> again and again. but i.

>> do think the press needs to. >> the media. >> needs to pace themselves. it's going to be four years. i mean, their heads are going to explode. >> i liked. x's coat, is what i thought it was like. >> a little man's. >> like trench coat. kind of. well over. >> but he's. >> like, if. >> that had been me, i remember sort. >> of what i was like. >> back then when, like i told you, when i'd be hearing president kennedy on. that's what i was thinking. who is this. >> guy and why. >> is he boring me with. >> with this? >> he so he's he's. >> in the oval. >> office with the president of the united states and the. >> richest man in. >> the world. he's like, these. >> guys are. >> just so boring. >> will they. ever shut up? when can. >> i go? >> when he's sitting on the. >> ground, right. >> and he's digging for gold. >> and it's like. >> jfk junior pictures under the desk. it's. >> yeah. >> but it was. >> yeah, exactly. >> yeah, but it was, it. >> was kind of i. >> happened to be watching. >> the whole thing and. >> it was it was pretty, you know, learned a. >> lot from watching. coming up. we're going to get you ready for the key inflation data. january cpi is due at 830. and it comes.

>> just ahead. >> of fed chair jay powell's next round of congressional testimony predictions next. then later, former house speaker kevin mccarthy joins us on the cuts to the federal workforce, the government funding fight brewing in congress, and much more. >> squawk box. >> squawk box. >> we'll be right back. help us retire. it's a simple ask of our elected leaders. but the tax treatment we rely on to grow our 401(k)s, iras, and other retirement plans could be on the chopping block in congress. any policymaker who makes it harder to save for retirement is standing against the financial well-being of 120 million americans. it's time to prioritize our retirement savings. learn more at help us retire dot org. help us retire is sponsored by the investment company institute, representing asset managers serving individual investors. discovering innovation today, helps drive growth tomorrow. as a leading global asset manager, pgim has established a track record of helping investors capitalize on growth opportunities.

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key inflation data. ahead, we'll get the january consumer price index at 8:30 a.m. eastern pulled. forecasters expect headline inflation hold steady at 2.9% year over year in core. inflation to tick slightly lower. then, at 10 a.m, fed chair jay powell, with that date in mind, maybe we'll testify before the house financial services committee. as far as earnings, we hear from biogen. >> cvs health. >> and kraft heinz before the opening bell. then after the closing bell, we'll hear from cisco systems, mgm resorts and robinhood. joining us now ahead of the inflation. >> data. >> citi economist veronica clark. veronica, it's good to have you on. morning. >> thanks for having me. >> i was just saying how. >> i just feel. >> like i'm. >> in limbo. >> or something about this number two. is it? it's not trump's number yet, is it biden's number? is there anything in it other than. i know eggs are expensive, and i know it's hard to buy a car now. or expensive to buy a car. >> yeah. >> this will be. >> an interesting one, but certainly not going to tell.

>> us anything. >> about biden. >> or trump or any. >> of that. >> yeah. >> so the last. >> couple of years. >> this january. >> reading has. >> been a pretty. >> interesting one. just because. we've seen this start. >> of year. >> strength in inflation data. we saw this in. >> a really big way last q1. so the big question is. are we going to get this start. >> of year. >> price increases. >> just as strong. >> this year? >> and i don't. >> think we will. >> i think. >> that will show us. >> that there is. >> less. >> inflationary pressure. >> than there was over the last couple of years. >> what's the. is it. >> always oil or what. >> is it that that. >> dictates whether we're ready for some type of period of higher inflation. >> yeah. >> what do we need. what should we be watching for. what's the alarm bells. >> yeah. >> in the in. >> the. >> details of this inflation data where we've seen that residual. >> seasonality show up. >> is really in. >> services prices. so for. >> medical services transportation. >> recreation i think it's just. >> reflecting that. >> wage costs have gone up a lot over. >> the. >> last couple. >> of years. and it's the start of the. >> new year. and. >> those service.

>> providers are raising. >> their prices. >> so that's. >> where we've seen. >> the residual seasonality in the past. but i think. >> a. >> really important. >> driver of inflation this. >> year. >> which has not been the case the last. >> couple of years. >> is that we do. >> see components like shelter. inflation slowing. that's related to housing and rents. and that does finally seem to be catching up with. >> market rents that have been slower for. >> a while now. >> so you're expecting a friendly number for the markets. >> it will be stronger than. >> the last couple. >> of months. but the key question is, is it stronger than last january? and i. think it will not be. i think there. >> will be some. >> slowing in inflation. >> this this reading. >> yeah. >> so what do we figure. >> that the fed. >> when they look at. >> cpi they've got their own way. >> of. >> measuring inflation. where are we right now. two and a half. >> yeah i would say you know. >> the measure that the. >> fed targets. >> most. is core pce inflation. >> right now. that's at two and 2.8%. >> year. >> on year. i think. realistically we are something. >> like around two and a half, 2. >> to 2 and a half range. >> and if. >> q1 is not as strong this year as. >> it. >> was last. >> year, that. >> annual number. >> will look a lot better. in a

couple of months. it will look. >> like two. >> and a half. >> 2 to 2 and a half is almost where we want to be. >> yeah. >> essentially, i do think inflation. has slowed a lot, and for that reason alone, the fed can be cutting at least a couple times this year. >> yeah. because 2 to 2 and a half isn't two and a half. it's 2 to 2. >> and a half. >> it's close. >> yeah yeah it's. >> close to target. yeah. >> so that means what for. >> for. >> cuts this year. you think in when. >> we have a still a very outlier. >> call on how much the fed is going to be cutting. we think 125 basis points of cuts. yeah i think we can get something like 75 on slowing inflation alone. >> i can. >> easily. >> see, you know. >> june, september, december quarterly. >> if inflation is. >> slowing and. >> policymakers think rates should be around. >> 3%, there's. still a. >> long way to go. >> but i. would be worried that. >> the recent stability. >> we've seen in the. >> labor. >> market is not. >> as. >> durable as. maybe fed officials think it is. >> so you see some slowing there. >> yeah. yeah. >> i don't think we certainly haven't seen it in the labor market data recently. i don't think. >> we'll see it for maybe another. >> couple of months. but i would be worried. >> as we get to the.

>> spring and. >> summer, a lot of. >> the rise in. >> the unemployment rate has been. >> driven by. >> businesses not hiring, and i have not. >> seen evidence that that has changed. >> so you would say. >> that the. >> risk now is on that side. yeah. inflation. >> yeah. yeah i think. >> a lot of the. >> narrative is. >> around stickiness to inflation. >> and we'll. >> see. >> how true. >> that is today of course. >> but i think there's a lot of reasons. >> that shelter. >> component to. be optimistic on slowing inflation. >> and there's of course a lot more. >> ways that the fed. >> would be cutting than hiking. i think any weakness. >> in the labor market. >> would. >> do that. >> i think that the stock market then would be. >> happy. >> happy, even. though it will trade some. depends on the. conditions that get us. >> there for our 125 basis points and cuts. >> sure, sure. >> especially if the jobs are government jobs that you're seeing. >> that could that could be part of it. yeah, yeah. >> because the government jobs were always the ones that were kind of keeping things steady. >> yeah. >> government employment. >> has been very strong. >> but that is still. >> going to be people who lose a job and. >> are not. >> spending in. >> the economy. of course. >> that's still going to.

>> slow things down. >> it is, but it's probably a little different in the in the psyche, particularly if some of those jobs are people who have said they want to retire. >> potentially, yeah. >> yeah, it depends on. >> maybe how they show. up in the unemployment rate. if someone's just. >> leaving the labor. >> force altogether. but yeah, it. >> will come down to that unemployment rate. i think the fed gets uncomfortable if. >> we're seeing something like 4.4, 4.5%. >> and it's all none of. the what would you even call what's happening in washington? i don't even know what to call it. >> but none of that uncertainty. >> none of that. >> playing into any of your i mean, it's slowing an economy and weakening inflation doesn't seem to take into account the worst case scenario that we're told about, right? >> right. we're we're not expecting. >> the big. >> disruptive tariffs. >> or, you know, the big, you know, mass deportations or, you know, really substantial cuts to government spending, partly because they would be pretty disruptive. yeah. >> your hair is not on fire. it's very nice. it's yeah, it's definitely i. can not even a

spark. >> i don't. >> think we'll. >> have. >> to change. >> our forecasts. >> our assumptions for fiscal many times. >> i'm sure. >> okay. well that's what makes it. that's why they you know, that's why you got to. >> come in every day. yeah, exactly. >> thanks, rod. >> okay, coming up on the other side of this, a lot more to come on. squawk. an update on the latest companies to roll back dei initiatives. we're going to discuss what's going on here. that is next on squawk box. >> when cyber threats target the world's data. seconds matter. >> that's why the world's most. >> trusted brands depend. >> on. >> reliaquest gray matter. to

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valuations revealed friday in squawk box. >> welcome back to squawk box. goldman sachs is abandoning its dei pledge that it made back in 2020. you might remember that it would only take a company public if it included two diverse board members, one of whom must be a woman. a spokesperson saying the decision was the result of legal developments related to board diversity requirements. a similar rule for listings on nasdaq's u.s. exchange, struck down by a federal appeals court in december. and i remember we talked a lot to david solomon about that decision at the time in davos. at one point, i think, and then also a bunch of other times as well. >> separately, disney is making changes. >> to its. >> dei program. >> axios reports. >> that the company is moving and changing some of its content. >> disclaimers. >> back in 2020, it started running those disclaimers. >> around certain. >> titles like. peter pan and dumbo. that said. >> this program. >> includes negative depictions

and or mistreatment of people. or cultures. the new shortened advisory notes will be moved to the details. section and will instead read. this program is presented. >> as originally. >> created and may contain stereotypes or negative depictions. >> disney is. >> also getting rid of its controversial reimagined tomorrow initiative and the corresponding website, and it's replacing the diversity and inclusion. performance factor. >> that it used. >> to evaluate executive compensation with what it's calling a new talent strategy. >> and the. >> public broadcasting service known as pbs, is shutting down its dei office to comply with president trump's executive order. >> the company's. >> director of dei and. senior vice president of dei are leaving the company, the network ceo said. pbs will remain. >> a welcoming. >> place, in their words, for everyone. >> and jp morgan. >> chase workers calling on ceo jamie dimon to retain the bank's hybrid work model and reverse its decision to bring employees back to the office five days a

week. that return to work mandate set to take effect early next month. the workers have launched a publicly visible petition that calls for better working conditions and argues to not only keep the hybrid model, but to expand it. >> good luck with that, slackers. well, it's look, we've known for a long time workers have the upper hand have had the upper hand for a while. if you swing back to a situation where there are fewer jobs to be had, then you may lose some of that leverage. although citibank has gone out of its way to kind of say that it is going to continue to do that, and it may be a way to hire away some. >> they didn't spend $1 billion to build a gorgeous new building on park avenue that they need. >> to fill. >> good luck with that. >> i'm willing to talk about the four day thing. yeah. for us, we can have that discussion. >> we can have that discussion. >> everybody we can have that discussion. >> for everybody. >> i'm not talking three, talking. >> four or. >> talking four. >> not going crazy. not going

nuts. >> i know we i know we got to go. and this is they're going to say this is frivolous. >> if you could how is this frivolous. >> if you could pick one day. yeah. monday or friday. monday or friday or is it wednesday? right. >> i'd have. >> to think about it, because. >> other times i've thought i'd like to. i'd like to pay my dues the first week and then have the monday off. other times i'm thinking i really like. but fridays are my favorite days anyway, even though we have worked. so maybe the monday, you know, then there wouldn't be. >> but then tuesdays. >> would become the mondays. >> yeah. >> i think i'd take fridays, get you working fast. >> mondays. >> done with it. >> we're just fantasizing. >> i would take wednesday. >> you want the wednesday? >> so you. >> never take the monday and the friday. i'll take the wednesday. >> all right. >> we can work. >> that there. there's your deal. >> i understand the wednesday, because then you. you feel like you don't kill yourself. >> i have. >> children that have to go to school, so there's nothing i can do on monday. i can't go somewhere. >> no, it's not, but you can get stuff done. the idea of a day off is to get stuff done. >> i just. >> want to sleep. really got

nothing to do with anything. >> all right. >> okay. >> all right. fantasy is over. when we come back, a strategy divide among gop lawmakers. >> on how to. >> tackle president trump's legislative agenda. we will take you live to washington, d.c. next, where there's about six inches of snow right now, though, as we head to a break, let's take a look at yesterday's s&p 500 winners and losers. >> executive edge is sponsored by at&t business. next level by at&t business. next level moments need the next level it all started with a small business idea. it's a pillow with a speaker in it! that's right craig. pulling in the perfect team to get the job done. i'm just here for the internets. at&t, it's super-fast! you locked us out?! and when thrown a curveball... arrggghh!

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shop, now with code tr20 for 20% off. terms apply. >> good morning everybody. >> welcome back to squawk box. we're live from the nasdaq market site in times square. if you take a look. >> at. >> the futures this morning dow's in the red off by about 50 points s&p futures down by just four. the nasdaq indicated up by about ten points. cvs health just out with quarterly results. those earnings. >> coming in at. >> $1.19 a share. that was much better than the $0.93 the street was looking for. revenue came in at 97.71 billion.

>> that was. >> slightly above estimates. revenue in cvs health services, pharmacy and consumer wellness and health care benefits segments all beating expectations. the medical benefit ratio coming in about 100 basis points better than expectations. you can see that stock up by about 7.1% for. >> the full year. >> cvs sees earnings in the range of $5.75 to $6 a share. >> that compares. >> to estimates that were at the high end of that range of $5.96. >> okay. the white house and senate remains split on how to fulfill president trump's agenda. emily wilkins joins us now with the latest from washington, dc. and the fire hose of news continues. >> it truly. >> does, andrew. >> and the. >> senate today is going to continue to make some news. >> they're racing. >> ahead with trump's agenda, taking the first steps to move an energy and border package today, or at least agree on spending levels. but speaker mike johnson said that that's going to be a nonstarter in the house, because it doesn't include. >> anything on. that tax.

>> package that also needs to be done this year. so house republicans are planning to vote thursday on a larger spending bill, including tax and energy. it's that whole one big, beautiful bill concept we've been talking about, but we haven't seen any details from house republicans on exactly what this is going to look like. and one big question is how long to extend trump's 2017 tax cuts. you know, trump republicans, they would like to do so for a full decade. that's going to cost about 4.7 trillion. yet a recent house plan only advocated about 4.5 trillion. and that's not considering things like tax on no tax on tips. lawmakers are looking at extending the tax cuts for about only five years. but kevin hearn, who oversees gop policy in the house, warned. >> that that might not fly. >> with trump. >> maybe some republicans would. >> approve of that, but i don't. >> think the american people would, and certainly president trump wouldn't. >> he wants. >> it to be permanent. >> the american people want it to. be permanent. i think it's

incumbent upon us to try to figure out how to make that happen. >> lawmakers do need to agree on funding before they fill in all the policy details, so that senate committee is scheduled to meet today and tomorrow on a $340 billion package. the house package is expected to be in the trillions. and guys we could be getting details on that hopefully this morning if they're expecting members to start taking votes on it tomorrow. >> okay. emily wilkins in washington this morning. thank you. >> when we come back. >> we'll talk about. the potential. >> impact of president. >> trump's tariff. >> strategy on the auto sector. >> that's next. >> and a. >> reminder, you. >> can get the best of squawk. >> box in our daily podcast. >> just follow. >> squawk pod on your favorite. podcast app and you can listen any time. >> we'll be right back. >> it's no. >> secret bitcoin. >> is. >> stronger than ever. over the past. >> five years. >> even as. stocks ripped higher. >> bitcoin has crushed the. >> s&p 500 and nasdaq and high

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elon musk is working to slash government spending. speaking at the ubs financial services conference in miami, griffin said musk will do, quote, what it takes to win. but griffin had tougher words for president trump. he said that those threatened tariffs on imports from mexico and canada, he says, dull america's competitive edge. he said there are bad negotiation tool because they sow permanent mistrust and ally with allies and degrade the terms of engagement. griffin gave a $5 million to nikki haley's unsuccessful bid to beat trump, but later said that he voted for trump in the last year's election. >> meantime, ford ceo jim farley is warning of chaos in the auto industry because of those tariffs, and gm ceo mary barra said that she expects to be able to mitigate the impact of up to 50% of the potential costs of the tariffs. >> joining us right. >> now to talk about the impact on the auto sector is dan levy. he's barclays senior equity research analyst. and dan, this idea of chaos you feel for jim

farley? i heard jim cramer talking about this and agree with him completely. this is a guy who bought into the idea of nafta 2.0. that was president trump. his plan in the last administration that was put forth. they bought into that, set up their plants accordingly. and now they're kind of getting the rug yanked out from under them. >> yeah. thank you. thank you so. >> much, becky, for having me. >> it is. >> chaotic because you have to just. >> put the auto. >> sector in context. >> to. >> you know what, u.s. versus mexico and. >> canada manufacturing is. >> mexico and canada. >> account for roughly a third of north america auto production. they account for roughly. >> 25% of. >> the vehicles. >> that are produced in the u.s, or vehicles that are. >> sold in the u.s. >> and perhaps more importantly. >> it's probably. >> over. >> half of the parts. >> and so. >> when you. >> think about. >> the potential. >> for tariffs. >> this basically. >> wipes out group. >> profit for. >> each. of the three.

>> creates a lot of inflation. and you could easily see a. massive supply shock because of the ripple through. effect to. >> all the smaller. >> parts suppliers in the system. >> the likelihood. >> of the. >> tariffs being imposed at this point, what do you think. >> 25% tariffs just seems way too disruptive. >> and so even. >> if it's there. >> for a little bit, it probably. >> won't stick. i think the better question is, is. >> if there's a more. >> lasting sort of smaller tariff of even, say, 5%, or if they. change content requirements that require pushing content to the u.s? that's the better question. >> and even that would be inflationary. >> and have an impact. >> are any of the big three automakers or other automakers behind them changing where they make their products changing? i mean, it's harder to change the supply chain overall for the parts and other issues along those lines. but the goal of this is not only to raise money from the trump administration's

perspective, but. >> also to try and. >> increase production in the united states. are any of the moving towards something like that? >> well, well, no, not not yet. because the lead time on. >> any changes. is anywhere from. >> 12 to. >> 24 months. >> there's a. >> very long. lead time. it's very capital intensive. >> and so naturally. the automakers aren't really. going to do. >> anything until they know a firm direction. >> on policy. there are small. >> things they can do in the. >> near term. pivoting production or changing some near term parts sourcing, but deeper changes. that's 12 to 24 months and a lot of capital required. >> so mary. >> barra says. >> she thinks she can mitigate up to 50% of this. how does she do that? and do you think she's effective? >> well, that's 50% right. >> there's another. >> 50% that can't be mitigated. >> i think. >> the point is, is just remember, automakers and the entire. >> auto. >> industry as a whole is a very tight margin industry, right? we're talking about, you know, mid to at best. high single digit margins. >> for automakers parts.

>> suppliers is anywhere from low single digit margins to low double digits. really. there's not a lot of margin here. so there is near-term steps that you can take to best mitigate actions. but to really create a healthy. >> industry. >> it requires deeper changes. >> but your ratings on these companies equal weight for ford, for rivian, for tesla. you've got an overweight on shares of general motors. so do you not think that this is going to come to fruition. the tariffs. >> yeah. >> we think long. >> term there won't. >> be, you know. >> 25% tariffs. i think we're waiting to see what happens with content requirements. that's potentially a change. the irony here is that the us sales market is very healthy. pricing power is very strong. you're seeing you know pretty healthy volumes mix is very good. gm has. >> been picking. >> up record. >> profit for the last. >> call it four years. >> this is going to be a fifth straight year. >> of 14. >> billion plus profit. these

are results. they never did pre covid. and so our point is the sustainability of these earnings is something that deserves a better stock price. >> okay dan thank you. >> great. thank you so much becky. >> all right. >> coming up. >> beer. stocks beer light beer moving higher after. >> i like. >> beer i like beer. after some positive results from heineken overnight. details next. and a programing note. bank of america chair and ceo brian moynihan will be on squawk on the street live at 9:45 a.m. eastern in a cnbc exclusive interview. we'll be right back. >> with 19 hotel brands at ihg hotels and resorts, you can guest. >> how you guest. >> unplug for the. >> day or plunge into. >> a long weekend. >> at a holiday inn. savor the moment or savor the details. >> at a crowne plaza hotel. >> stick to the agenda. >> or experience something. unexpected at kimpton hotels.

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details. >> physicians mutual, physicians. >> mutual. >> heineken shares are sharply higher. the dutch brewer reported operating profits that were better than its own

internal estimates and above analysts expectations. beer sales volume grew 1.8% in the quarter, and that was triple analysts consensus estimate, and heineken also raised its dividend and announced a $1.5 billion share buyback. as a result, we're seeing some other european traded brewer stocks. brewery stocks rise after heineken's report. i mean, i've been reading tequila. nobody wants expensive tequila anymore. you saw that piece, right? i don't think bourbon is real popular anymore. >> well. >> it is wine, okay. >> i think it's all relative to where. >> it's weird the way it jockeys back and forth. yeah. beer was totally out of fashion. >> yeah. >> for a while. >> i don't know. >> but you also. >> have the pressure that. and they wonder if ozempic and the other glp ones play a factor in this, as it has with some junk food people drinking less. it's also younger people don't get into the idea of drinking. >> so you're having dance

parties that are over at like 10 p.m. and they don't drink. i think that's all actually healthy. >> it's all. >> good movement. >> i think it is. >> unless you happen to be a spirits or alcohol. >> yes. >> are selling company. >> yeah. >> yeah. i didn't know if say brewery distillery importer. >> we've got a lot more coming up in just a moment. we'll drink a little in between. president trump sending treasury secretary scott besson to meet with ukraine's president. vice president vance also going to be meeting with zelenskyy this week. we'll talk geopolitics and the possibility of an end to the war in ukraine. we'll do that next. and then later predictions for today's inflation data january cpi due at 8:30 a.m. eastern time. do not go anywhere. squawk box will be right back. >> this is. >> the. emirates premium economy seat. >> economy. perhaps they need to. >> call it something else.

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pro now. >> welcome back to squawk box. vice president of finance and treasury secretary is set to meet separately with ukraine president zelensky this week. this comes as part of a broader push to try to end the war with russia and secure american access to ukraine's rare earth, minerals and energy resources. want to talk about all of this with michael froman, council on foreign relations president? how much closer are we or aren't we? >> well, yesterday's. >> decision to release mark fogel is a good, expert expression of good faith by president putin. this is an important week. we've got secretary hegseth is in europe meeting. >> with. >> the europeans about ukrainian security. and of course, vance will be seeing zelensky later this week. i think the real question remains, what's going to be the security arrangement for ukraine? the ukrainians have been willing to give up the 20% of their territory. they've known that for some time, but they're still looking for something like nato membership. and if the administration is not willing to support that, what kind of security guarantees can they offer to give the

ukrainians some sense that the russians aren't going to just come back in as soon as the americans turn their attention elsewhere? >> so what do you think is on the table? what's what's even possible? >> so with a lot of support from particularly from the europeans and some from the us, the ukrainians themselves can put in place a multi-layered defense system that digs in, creates real defensive lines, provides air defense, makes sure that they have the facilities and the capabilities they need. i think the europeans are going to need to put some boots on the ground, or at least have them ready to put boots on the ground. they've done this before. they've got some joint expeditionary forces. they have the ability to draw on nato troops for european. do you. >> think this is going to be a long drawn out and this is going to go on forever, is what you're saying? because once you're into the conversation of we need a defense system. >> well. >> the russians are coming back. basically, this is like a this is like a never ending war. then. >> you know, i think there could be an armistice, and i think there could be a defense system that deters russia from coming back in. but in terms of the conflict, the conflict is going to be there for a long time. russia has its eyes on ukraine and ukraine is very vulnerable.

i think the question is if ukraine is not going to be in nato, can nato be in ukraine? can nato troops, troops from the european? >> what about the whole rare earths situation? >> well, some of it is spread around ukraine, but a lot of it is in the part that's currently controlled by russia or close to the area that's being disputed. so if president trump really wants access to that, he's talked about $500 billion of access to minerals, then we're going to have to have that access to that part of the territory as well. >> michael, what do you think of the treasury secretary being sent? i mean, that surprised me a little bit. >> you know, on issues like the rare earths and oil and energy, he is the lead economic advisor. >> indicative that this is a big part. >> of the negotiation. >> and i think leading the international economic piece makes sense for him. >> yeah. >> why hold a guy. >> for four years for medical marijuana? i mean, that's just like a it's in biden. it's just what was that like? >> it's brittney. >> griner russia has a has a practice of got unlawful detentions. you know we've had other just just.

>> to mess. with the united states. >> well, you know, what they say is this american went to their soil and violated their law. and so, you know, they believe in the rule of law. they they they arrest people. >> big, big believers. >> big believers in the. >> rule of law. >> but it's you're right. it's holding. it's holding hostages for potential for potential trades. and that's what's going to happen now. and evidently the us is going to release some some russian prisoners as well. >> oh we didn't get. >> they haven't named the side of that. they haven't named the person. but they've said there could be some release. >> that's what it took for brittney griner to. >> go for. >> people who. >> had. >> been accused. >> of espionage here. it's. >> well, we got you here. >> yes, >> gaza, the next, the riviera of the middle east. >> yeah. >> what do you think? >> well, look, i don't think it's a feasible plan. and the king of jordan and saudi arabia and others have expressed that to the administration. there's no appetite among the arab countries for a resettlement of palestinians away from gaza into their into their countries. and. >> what is the impact of, of sort of ruminating on these

ideas aloud, even if they're not accepted wisdom of the crowds from, from elsewhere. >> you know. >> beyond the sort. right. can you speak outside the box? i mean, right, he would say the administration would say president trump's not out of the box kind of guy. he's going to throw out all of these ideas. and then there's another wing of the world. i think a lot of liberal democrats who think this is dangerous to even say these ideas aloud, because it sort of undermines the credibility of the united states as it relates. >> what's it really undermining? >> well, then that's my question. >> of the possibilities. >> for gaza. >> i looked. >> at and i'm thinking, it's unsaveable. it's just that it. >> wasn't a great place to live before october 7th. now it's so much worse now. >> but then, then you worry that even if. >> you go. and rebuild. >> it and get rid of the tunnels and get rid of all the unexploded bombs and everything else, then hamas slowly seeps back in and we do it all again. or israel does it all again in

five years. >> but i think your point is a good one, which is i think the president has this unconventional way of putting ideas on the table, and there's an element of truth or there's a, you know, a nugget of something that bears attention. so, you know, buying greenland, i don't think that's going to happen. but is arctic security important? should we be paying more attention to it as russia and china are paying attention to it? panama canal, that's not going to happen. but should we be concerned about china's role in latin america? sure. so i think he puts these ideas out there. it changes the dialog, it gets the attention of the world, and then hopefully we can find a way forward that addresses what some of the underlying truths are. >> so do you think it's actually good that he's doing this? that's the question. >> look, i know i think it's highly disruptive, but i think it does change the narrative. and i think it does get people's attention saying, okay, the us is actually, you know, as you said, thinking outside the box. now, outside the box can have a lot of negative implications for people like the palestinians who view that as their home. but i think at the same time, it gets the attention of the other arab

nations to say, we've got to do something differently when it comes to. >> what we saw yesterday. i think there was a pretty immediate response that hamas said there they want to work towards the cease fire. i mean, does it is it the factor of, okay, there's a little. >> bit of crazy here. >> we don't know what's going to happen. >> we want. >> to there is the madman theory of international relations. it goes back to president president nixon. and henry kissinger used it well with others to say, you know, i can't control this guy, and you never know what he's going to do. i think at some point it does undermine both the credibility of the presidency and the credibility of the united states. if we put stuff out there and then it ends up falling by the wayside. >> it's like the red. >> line, right? >> yeah. exactly. right. i mean, you might be critical when a previous president said a red line in syria and then didn't follow through on it, now we're creating red lines right every week. you know, whether it's on tariffs, you know, or ceasefires or something else. and, you know, i think one has to be careful about that. >> michael, juan, thank you for coming on this morning. >> thanks for having me. >> to see you. appreciate it. it is just 7 a.m, exactly 7 a.m.

right here on the east coast. you're watching squawk box on cnbc. i'm andrew ross sorkin, along with joe kernen and becky quick. got a whole bunch of big stories to tell you about this morning. it's a fire hose of news, as it has been virtually every day in the last 20 plus days. president trump signing executive orders in the oval yesterday, accompanied by elon musk and his son. the president directed agencies to work with musk, dodge department to slash their workforces and limit hiring to essential positions. one new hire for every four. >> they're getting a good deal. they're getting a big buyout. and what we're trying to do is reduce government. >> we have too many people. >> we have. >> office space. it's occupied by 4%. nobody showing up to work because. >> they were told. >> not to. and then biden. >> gave him a five year pass. some of. >> them, 48,000. >> of. >> them. >> gave them a five year. >> pass that for five years. you don't have. >> to show. >> up. >> to work. >> we're going to have so much more on federal spending, tech and ai later this hour, along with carried interest with joe lonsdale. and the markets are

gearing up for today's cpi data, giving a first look at inflation in 2025. the core rate expected to have slowed slightly last month. investors also going to be watching fed chair jay powell, who's back on capitol hill, for another day of testimony on the economy. so we'll keep our eyes on that. and california regulators saying they plan to impose a $1 billion special assessment on private insurers to shore up the state's insurer of last resort. that's also known as the fair plan, following the devastating l.a. wildfires that could end up costing insurers an estimated $75 billion. state commissioner ricardo lara lara saying that the assessment is necessary to continue paying out claims to fire survivors. >> take a look at the. >> futures one more time this morning. dow futures off by about 45 points. s&p futures down by three and a half. the nasdaq indicated up by about ten points. i want to get over to frank holland. he's been taking a look at this morning's pre. market movers. and what are you finding frank. >> hey good morning becky. we're going to start off with an earnings move. we're taking a look at shares of lyft right

now. you can see they're moving lower down double digits more than 12% after fourth quarter results where they reported a miss on revenue. but ebitda did beat estimates. one factor on the results. the company said it reduced surge pricing during the quarter, the rideshare company also giving gross bookings outlook for the current quarter that was below estimates. lyft making a number of other announcements, including a planned increase in app ads to boost revenue. also, a share buyback plan of up to $500 million. again, shares down more than 12%. also, lyft ceo is going to join you guys in just about an hour to talk about the quarter and much more. he joins squawk box at 8:20 a.m. eastern time this morning. we're also looking at shares of tesla. they're lower again this morning on news partly at least. the chinese ev maker byd is partnering with deep sea to develop autonomous driving tech. shares of tesla down about a half a percent right now, according to this report that's come out that byd will add partially automated features to new models that will allow for autonomous parking and also driving on highways. take a look at the chart here. you can see tesla year to date down about 19% on a five day losing streak.

again, shares down year to date about 19% right now down about a half a percent. we're also looking at shares of cvs. that stock surging also another earnings mover on top. and bottom line beats eps came in at 119 a share. the street looking for $0.91. cvs also giving full year guidance. that was in line with estimates. you can see shares are up just about 9% just over 9% right now. ceo david joyner said the company saw meaningful recovery in its aetna business that provides health insurance plans. he also added in part, we have momentum as we enter 2025 and we are making progress to be best in class, in total cost of care and customer experience. and my first 100 days as ceo, i see an organization ready to move forward and help customers, clients, colleagues and patients win. joyner took the top job back in october, previously running cvs pharmacy business again. shares of cvs, they're up well right now about 8.25%. but again moving higher. back over to you. >> yeah it is a big move frank. thank you. we will see you in just a little bit. >> tom shares of biogen

whipsawed just in the last few minutes. let's show you what's going on here. the company's earnings coming in at $3.44 a share. $0.09 better than estimates. revenue of 2.46 billion. now, that topped expectations of $2.4 billion. but for the full year, biogen sees earnings in the range of 15.25 to 16.25 a share. now, that is below the estimate of 16.34, it's also expecting total revenue that you're saying to decline now by mid single digit percentages for 2025. and that compares to the estimates of a decline of 2.1%. >> looks like you could ski on that baby there. that's a double dime or triple diamond right. >> it's 250 to double blue. >> double blue. double blue. >> no no no. >> it's not steep enough. >> no, it's not. even a black. i think it that is when you're actually on the slope, it looks steeper than. it's probably not much different in reality than that. >> do you know, as you look at it, just on year 24, coming into

like half the year that that could that could be steeper. it could be like a block. >> yeah. okay. all right. coming up, market historian and wharton professor jeremy siegel on the markets. haven't spoken in a while. i don't know if we've seen him this year. that'll be good. and later, a wide ranging interview with palantir co-founder joe lonsdale. that's always fun. squawk box will be right back. >> the most. >> challenging engineering. >> project in the. history of the human race is our nation. >> golf has never been closer to the heart of this. >> country. >> straight down exists thanks to american manufacturing and the movement. >> to. >> celebrate all things american made. we love this game and we

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think, doug, on a scale of 1 to 10, we had a technical analyst on yesterday that basically said that has been a group not to really be in. and if you were just looking at tech, you might not be as bullish on financials. great. others great. but as far as tech goes, you might not be bullish on the overall market because of the action. is that true. we're still bullish. >> on tech. >> and i. >> would say on your. >> 1 to. >> 10. >> scale joe i think deep. >> tech monday. >> two and a. >> half weeks. >> ago. >> that was. probably about. >> an 8.5. >> or. >> a nine. >> that was a pretty rough one. >> but i think. >> since then. >> we've had things calmed down a. >> little bit. >> we've heard from a lot of the hyperscalers in terms of earnings. we've heard from the hyperscalers and from sam altman and others. >> in the ai. >> industry that. >> this capex. >> boom is going to continue. >> so i think. >> the last couple of weeks have been much more. >> stabilizing. and the next. >> big event will be. >> nvidia earnings in. >> a couple of weeks. >> so anything that's ai related, i mean really only been

focused on that for a couple of years. it used to be the magnificent seven wasn't always based on ai, so it's all ai now. is everyone leveraged to the same extent or some could do better. some are more. you know, if there was some type of disappointment, there's some that aren't as dependent on ai. what's going on with meta, for example? i think. >> there's tiers. >> in terms. >> of the hyperscalers. >> and how levered they. >> are to ai. >> meta. to your point, which is a holding in our. liver etf. >> as an ai play. >> they are highly levered. right. they're one of the. >> leaders in. >> open source. >> ai with their llama model. and so. >> they've. >> been using ai. >> to. >> improve their business. >> they've been building ai. >> models to. >> introduce to customers. >> google obviously and nvidia are also very heavily tied to ai. but if. >> you're looking. >> for hyperscalers. >> that have. >> maybe a little. >> bit. less exposure, i. >> think amazon and apple are probably the two. >> answers there. >> although we did. >> just. >> see apple made a deal. >> with alibaba.

>> which is interesting in china to. >> bring their. >> ai models onto the. >> iphone in. >> that region. >> so in terms of tariffs and everything else that we're talking about on a daily basis, these totally immune or is that something to pay attention to? >> i think you have to pay attention to it for. >> the hyperscalers. >> as it. >> relates to terrorists. >> but i don't think you have. >> to have, you know, a kind of a five alarm concern. >> about the tariff. >> issue here. >> i mean, these companies, by and large. >> i think, can get away. >> with not. >> being overly. >> impacted by tariffs because they aren't really subject to some of the, i think, import and export issues that we're seeing with the tariffs, and they won't. >> likely get hit with. much of the. tariff activity. and so i. >> think from our perspective, an intelligent alpha, we're paying attention to the story, but we're paying much more. >> attention to how. >> are the ai products that. >> these. companies are. >> building evolving? how are the customers adopting them? i think that's much more important for. the stocks. i mean, if

china was if it became a protracted trade war with china, that would be bad for some of these companies. very bad, i can imagine. i don't think that's really going to happen. i think, you know, trump like he does so often. he wants to get something. and it may not even be that significant. it'll sound significant when he gets it. but do you see a protracted confrontation with china with with the trump administration? i mean, i think if you look at. canada and. mexico as comps just recently. >> it certainly seemed. >> like that was really more on the negotiating side. not to say there won't be tariffs on those countries, but obviously both countries sort of agreed to change some of their border policies. and the tariffs got stayed for a month. and so i think to your point, joe, you know, i think that trump is being a very hard negotiator here. he's not messing around. he wants. >> to. >> see action immediately. and so i would agree with the assessment. like i don't think it's likely that we'll have a protracted trade war. if you're looking for what might be the

hyperscaler or the mega-cap tech stock that could be most impacted by that, you probably have to look at nvidia, tsm, kind of how that region shapes out in terms of the chips that are produced there. they maybe have the most exposure if you're looking for that name. but again, i don't think that's going to be an issue in the next 12 months. all right. so what if i should buy what's your top two that that should be bought right now in. >> terms of hyperscalers. >> the two that we. own in the most size for our etf lirr are nvidia as our top holding and then meta in the ai space. but i think there's another play on ai that is also worth talking about, which is we've talked so much about nvidia. they're the bellwether. everybody's paying attention to nvidia and what happens there. but i think that the theme around. >> the chips. >> that the hyperscalers and others will use to deliver this ai technology to their customers will shift to custom silicon. and we heard meta talk a little bit about it on their earnings call last week. i think you

could see companies like a broadcom like a marvell, which is also a holding. they could benefit from this theme. and so as the year progresses, i think that's a theme that's worth paying a little bit more attention to this custom silicon opportunity. okay. let's start using that. cocktail parties. going to start moving into. >> custom i'm sorry doug, what is that. >> you say, custom silicon? people think you're getting a breast implant. >> for. >> it's at. >> least memorable. yeah, it's a custom. yeah. >> making the chips directly for. >> right. making them custom made. all right. yeah. google makes them tpus with broadcom for example. and it's just a chip that's optimized for the. >> algorithms that google runs. >> okay. >> thanks doug. >> thank you. >> all right. >> up next. u.s. drivers. may be. >> hitting a. >> fork in the road. >> when it comes to suvs and trucks. phil lebeau has that story. next yogi berra says you come to the fork in the road, you take. >> it. >> you take it. >> squawk box will be right

back. >> time now for today's aflac trivia question. on this day in 1997, the dow jones industrial average closed above what level for the very first time. the for the very first time. the answer when squawk box prime, it's me. i mean, you. wake up, come on man! you gotta tell employers to take another look at all the benefits they're offering. everybody wants to build the best team and offering aflac can help attract and retain that top talent. you know we like that top talent. and listen, i mean you gotta listen. aflac gives employees cash to help with unexpected medical bills. it's prime time to add aflac. request a call today at aflac.com/prime carl: believe me, when it comes to investing, you'll love carl's way. take a left here please. driver: but there's a... carl's way is the best way. client: is it? at schwab, how i choose to invest is up to me. driver: exactly! i can invest and trade on my own... client: yes, and let them manage some investments for me too. let's move on, shall we?

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squawk box. and now the answer to today's aflac trivia question. on this day in 1997, the dow jones industrial average closed above what level for the very first time. the answer 7000. >> there's a growing debate. it says here in the auto industry has the nation hit peak truck and suv demand, and are sedans making a comeback? which i would not have thought. phil lebeau, you got to talk me into this. he joins us now with more. i wouldn't even know what sedan. joe. you can't talk me into it. >> i wouldn't say. >> they're making a comeback. >> but the dave canton group, which specializes in m&a within the auto industry, they put this idea out a couple of weeks ago, and it sparked some. debate within the industry. are we at peak truck? and by. >> that. >> the claim that some are making is that we're not going to sell any more. >> suvs and. crossovers market share. >> wise than what we do right now? >> this chart. >> says it all. cox automotive

ran the market. >> share for suvs. >> versus cars, going all the way back to 2012. you don't have to be a rocket science to figure this out, that when you're looking at the market right now, cars and they're just not popular, they're just not offered very much. and that's part of the reason here. yes, you can still buy a car right now, but for the most. >> part. >> that market is dominated by the asian automakers. they offer more more sedans, far more sedans than the big three who essentially have gotten out of that business. yes, they offer a few niche models within that. think about the mustang, think about the corvette. but otherwise you just want to run the middle sedan. you're just not going to find it out there. the question is whether or not peak suv is because we are seeing prices tickling 50,000 on average in terms of what people are paying. j.d. power ran some numbers for us. look at the growth in average transaction prices going back to 2015 compared to now. look at. pickup trucks, the. >> average pickup. >> truck, more than $54,000. and

there you see the average suv more than $43,000. so again, as you take a look at the asian auto stocks, they've benefited from. this because they realize that not everybody wants a crossover or an suv in the united states, a lot do. but there are also a number of people who want a camry or a civic, and as a result, they've played to that market quickly. take a look at the big three, so to speak. gm, ford, stellantis. they're the story with these guys right now is trying to navigate what's happening with the potential of tariffs and. also steel tariffs that are going into effect right now. you heard jim farley. >> yesterday saying this is. >> creating chaos for the automakers as they try to navigate what the trump administration may or may not do and how this impacts their costs. at the end of the day. >> can you even buy a dodge like muscle car? i don't think it's still they don't even have a dodge dart. like a muscle, a

dodge challenger, i don't know, but, you know, it used. >> to be challenger. >> yeah, yeah, you can, but it used to be the honda accord. everybody had a honda accord, and you could see even i did. then there's a lot of mercedes though. a lot of if you, you know for the if you're somewhat i guess for the wealthy if you want a sedan you buy like a mercedes sedan. and you know what else. tesla's sedans, tesla sedans, six of them passed me to go anywhere. and i see tesla. >> but what's. >> what is you know. >> and then you look at their most popular models that is out there right now. it's the model y. which is not a car that's really more of a crossover utility vehicle. >> or a crossover. >> but but cost is a limiting factor. >> or if you're driving. >> a truck parking in a city, i mean, you pay an extra 30 bucks at any of the garages. if you're driving a car that's not a sedan. >> yes. you might not even be able to. and even parking space of the day. yeah. americans. >> look, americans have always liked big automobiles. that's why suvs and crossovers are so popular. we are big people who

want big automobiles. generally speaking, in this country. >> especially if you have a bunch of kids, it's impossible not to have either a minivan or an suv. and the other thing i'll say is, once you go to an suv or a crossover or a minivan, you don't want to go back because it's nice to be up high. you feel safer in it. and if you're worried about somebody else hitting you on the highways, if they're all in big cars, you need to be in a big car to. >> and there's fewer. >> selections out there if you're looking for a sedan. having said that, there are some who are now saying, come on, are we going to see any greater market share gains within the suv and crossover segment, or is this pretty much it? you put them in pickups together, you're at 82%. will we see it grow from there? maybe not. >> what's this is a like a 911 a sedan. that's a sports car. is that a totally different classification? so what is that? >> no, we're just talking. >> we're just talking cars. >> just the segment cars. that's a car. >> i wouldn't. >> call it a sedan.

>> you're in a sedan. >> a sedan? well, you're in a minivan. >> i am in a minivan, i don't care. all right. >> thanks, phil. >> it bothers you? it doesn't bother me. >> minivans bother. >> me greatly. sedan. you're in a sedan. >> coming up, folks. >> wardens, jeremy siegel on the fed markets and the president's policy moves. and then a wide ranging interview with palantir co-founder and investor joe lonsdale. he is backing elon musk's big bid to hostile bid, i should say, to try to buy openai. we'll talk about that. we'll also talk about the president's economic plan and doge and so much else. you don't doge and so much else. you don't want to miss it. -what've you got there, larry? -time machine. you gonna go back and see how the pyramids were built or something? nope. ellen and i want to go on vacation, so i'm going to go back to last week and buy a winning lottery ticket. -can i come? -only room for one. how am i getting home? sittin' on my lap like last time, ronald. fine, but i'm bringing this. [ whirring ] alright.

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shares of super micro computer. the company's ceo saying that he's confident that it's going to file its delayed annual report by the sec deadline of february 25th. a lot of people have been focused on this because the company gave some optimistic commentary for its fiscal 2026, but for the near term, companies slashing its guidance for the 2025 revenue and also warning that net sales for the prior quarter are likely to come in below estimates. take a look at shares, because they have been on quite a roller coaster ride since hindenburg. research revealed that they had a short position. companies delaying releasing its annual report in august because of all of these issues. and right now you're looking at it up pretty big time, 10% right now. >> schwab spends a lot of money on advertising, so they've got me where i hear schwab and i. >> i wondered what that was. >> that was carl. >> carl, the broker. >> that always. >> looks bad. yeah. okay. i wonder what you were doing. it was like your tourette's. >> and i have decided that, no, it wasn't tourette's. but i have

decided that if you want to be an actor, it's commercials is the way to go. the state. jake, it's state farm. yeah, the allstate guy. >> that's why. that's why. >> flo. progressive. >> that's why. >> better than. >> geico is so smart about it. because they they don't have to pay the actor. >> they pay for the voice. >> yeah. gecko. yes. you can make a lot of money in commercials. >> unless you want to beat the pavement. going on these auditions to get some crappy small role doing something. jake, it's state farm. jake? jake at state farm. shares of lifter. >> jake at state farm. >> yeah. what's your name? flo. right from progressive. and what's the other guy's name? jim. jimmy. shares of lifter andrews looking. >> at me. >> shares of lifter. just it's changing. you know, all the other actors are hesitant to do commercials. that's where the money is. that's where. >> not if you watch a super bowl. you had harrison ford. you had bill murray. >> yeah, exactly. yeah.

>> making a fortune doing it that way. >> yeah. they used to just do it over in japan. in fact, bill murray did a movie, a movie where he was. right. >> lost in translation. >> yeah. the shares are tumbling. the rideshare company issued a disappointing outlook for gross bookings in the current quarter, a warning the cold weather has hurt demand for ride hailing and bike rentals. revenue in the previous quarter fell slightly short of estimates. we'll talk all about lyft at eight in the 8:00 hour with when the ceo, david risher, is going to join us live. >> check out shares of kraft heinz that's falling after the company's full year profit guidance coming in below estimates. company, citing sluggish demand for its lunchables and packaged meat products, is following price hikes. it's interesting because of some of the inflationary effects. fourth quarter revenue also coming in below expectations. the stock down about 3.5% on the back of that news. >> take a look at the futures. >> one more time. again it's a. mixed picture that we've seen so far this morning. right now it looks like the dow futures are off by just over 50 points. s&p

futures are basically flat. they're off by about one and a half points. nasdaq futures indicated up by about 27. of course the markets are waiting for that inflation data that comes in just. >> an hour's. >> time 8:30 a.m. eastern time this morning. we're going to be looking for the cpi number. see what happened. and we'll talk a little more markets right after the break with jeremy siegel. and in the next hour, former house speaker kevin mccarthy joins us ahead of tomorrow's markup of the gop's big beautiful budget bill or bills, depending on whether the house or the senate gets to decide on or the senate gets to decide on this. the squawk box will i can't believe you corporate types are still calling each other rock stars. you're a rock star. we're all rock stars. oooo look look at my data driven insights, i'm a rock star. great job putting finance and hr on one platform with workday. thank you! guys, can you keep it down. i'm working. you people are (guitar noises). hand over the air guitar. i've got another one.

>> in breaking. >> news, tiziana life sciences announced a significant milestone in its clinical development program for alzheimer's disease. >> tiziana. >> life sciences. >> stock symbol tlc. >> on the nasdaq has successfully. >> dosed their. >> first patient with moderate alzheimer's disease with a new therapy that reduces neuroinflammation in glial brain cells. this mechanism of action could revolutionize the treatment of alzheimer's disease, pioneering a new. approach to treating alzheimer's. tiziana life sciences stock symbol tlc on the nasdaq. >> something very strange is happening in the us stocks following the election, and it could spell disaster for some of america's favorite tech companies. my name is mark

chaikin. i built three new indices for the nasdaq during. >> my 50. >> years on wall street. so when a big shift plays out in our country's tech sector, i take notice and help my over 1 million followers around the world prepare. you see. >> as the. >> overall market soared after the election, a record $5 billion poured out of american tech stocks. it was the biggest sell. >> off for. >> us technology funds. >> since the 2022 bear market. >> now, why did this happen? and more importantly, what does it mean for your money? i recently returned to. wall street to record an urgent market briefing explaining everything you need to know. you can watch it for free at the website below. >> and even get. >> the name and ticker of the number one. tech stock i urge you to sell today. >> again. >> 100% free.

>> if your life goal is to bring people together. coffee is the. perfect catalyst. ambition to me is when. >> you become your. >> authentic self in a way that allows. >> us to really work with common purpose. >> all right. welcome back to squawk box everybody. >> i get it. we want. >> to bring in a regular guest who's got something special going on today. >> this is. >> jeremy the eagle siegel. professor emeritus of finance at university of pennsylvania's wharton school of business, chief economist at wisdomtree. congratulations, jeremy. a huge win for the eagles. and man, was

that decisive. >> absolutely. >> i think. >> the mvp should be given to. >> the defense. >> i don't want. >> to take. >> away from jalen hurts. he did great. but wow. what a smash down. >> unbelievable. >> there was nothing that that mahomes could do. and to see him flustered like that that. >> is i've never. >> seen that before. >> me neither. >> me neither. >> that was something. anyway, congratulations. and i get it. the hat i would. >> i'd probably. >> wear that all year myself. professor siegel, let's try and figure out what's happening in the markets. we spoke earlier this morning, and joe made this point that he's feeling unsettled by all this not knowing. feeling a little rudderless, i. >> think, was the term. >> you used? yes. and i think that's fair. there's so many things that we're waiting to see, not knowing exactly how things are going to play out with policy from washington, with tariffs potentially. how do you look at all of this and try and figure out what to do with the stock market? >> yeah. >> and i think the cpi. >> in an. >> hour is going to be one of the least impactful. >> that we've. >> had over the last.

>> six. >> 12 months. first of all. >> i don't think it's going to be a great one. there's. >> seasonal biases that push. >> up the january. >> so i think it's going to be at or maybe one. >> tick above. secondly. >> we have a whole. >> new monthly cycle of data before the. >> fomc meeting on march 19th. >> so you. >> know, it's always the latest one next month. that tends to count. and truthfully. >> i. >> think that the market is now, you know, more concerned about tariffs. >> than the cpi. >> i mean they're sort. >> of. reconciled to. >> hey maybe. >> one cut, maybe not. >> i mean, that whole thing. >> about four cuts is, is down. >> i know. >> citibank has called for that. >> but that i. >> think i think you're only going to get 4 or. >> 5 cuts. six cuts. >> if you're going to if you're going to get some really. weak economic news. >> and i. >> don't. see that. a second thing. >> of course, that's. >> coming up. >> is, again. >> the shutdown. >> of the government. >> you know, he. >> trump has to get.

>> all the republicans on board. >> you know the. >> dems are all going. >> to vote against it. >> so, you know he has to line. >> all those up. so i think. >> you know. >> that's that's factor one. >> but i. >> think, you know. >> the question. >> of whether. >> trump's going to with the tariffs are going to be reimposed and at. >> what level. >> and what kind. >> of level. >> of retaliation. >> i would put that as number one. and i'd put the question of getting. >> everyone in line. i think there will be another continuing resolution, because until. >> they. >> get that omnibus. bill put up and passed. >> but. >> they need to fight. >> for that. >> and then of. >> course, looking. >> at that data. but again, we have six weeks until the meeting. >> so if you're looking at positive factors, i guess. >> it's still doge. >> and the regulatory changes that have been brought by it. how much of that has already been factored in? >> well, i. >> think is exciting. >> i mean. >> actually. >> i think that that i think the market is looking very

positively and surprisingly, how much they think could be done under musk. i mean. >> look what. >> he did to tesla. i mean, he. had saved costs that virtually no, no one, no. expert thought was possible. and, you know, he was he. you know. they gave him that that mega pay package that they never thought they'd have. >> to pay. >> and he made it. so, you know, he he would be the man to do it. and i think there's, there's excitement about that. but then again, i mean, how many how much are you going to save and what is that. you know, i mean, you know, trump wants to take taxes off of social security, off of tips. he you know, he talked about making the salt deductions again full. i mean that's a trillions of dollars. so you need to come through on some other side to get that passed. that's going to be a tough nut to crack. but i think you know those i think those are the things swirling around, you

know, how do we position politically. you know, we got to get the continuing resolution. then we get an omnibus omnibus bill that includes border security, immigration and the tax cut extension, plus some other tax cuts. i think the 2017 tax cuts by themselves is easy to get through. i think everything else is going is going to be harder. and that's that's where the fight is going to be. >> so jeremy, we had someone say 125 basis point cuts. i don't know about that, but are you counting on any multiple expansion? and if not, we're not cheap. and that might not be a reason to stay out of the market, that we're not cheap. but what do you say? are we at 22 times earnings? what what what would you say 22. >> we're at 20. >> we're 22. >> anything we get, any advance we get is going to be from from earnings growing. is there a

reason to think that that the environment we're in would, would allow companies to grow at 10 or 15% this year. >> yeah. >> well. >> you know, we have these two markets. we have the mag seven which is x techs. s tesla is selling for 3035. and then we have the other 493 stocks that are selling more towards 19. >> which is. >> to me very reasonable. i've often talking about 20 as an equilibrium p. so really it depends on what happens to that section. and you know there we had deep seek. we had that bid announcement putting pressure i think on tesla is that is that sector going to be the leader in the next bull market. so the question is overall people say 22, but we really have these two

markets and whether mag seven can continue the momentum that it's had over the last five years, ten years, or whether we see the cracks beginning to form in some of the narratives on on the mag seven. >> you wouldn't. >> necessarily advocate putting any money to work right now. you want to wait and see the data. >> two i would i would be cautious on the mag seven. i like the other the other groups. i mean, at 19, i like them. and, you know, we've talked about a long time and certainly they haven't. they've lagged. you know you go to mid cap and you go to small cap and you go to 15, 14, 13. you don't need much growth to get a decent return on that. but as long as the mag seven continues 1518 they'll be the leaders. the question is now we see this competition could could bring down margin. will

they be the leaders in the next 12 months? i'd love to be able to give you an answer on that, but i think we just have to wait and see on the data. >> can you. could that defensive line do that to every other team, or did did the kansas city, did they just their offensive line just didn't show up? i mean i saw kelce, they were running right around him a couple of times. >> the tight. >> end. >> i mean it's a combination of both. but look look at our d line on the nfc championship against jayden daniels and washington i mean we were just peaking. >> if your quarterback. >> has 0.2 seconds to do something. he can't. >> win number one rated defense in the nfl. >> from you. know like. >> what 25th last. >> year yards. >> so i mean wow. >> crazy crazy i don't know why it wasn't more obvious. >> professor siegel. >> eagle siegel. >> thank you. >> siegel got the hat on. >> yeah we'll see you later. >> i wanted to give you a hat for today. >> we like it. >> i have an i have a green. tie

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>> mutual, physicians mutual. >> welcome back to squawk box. during a press conference inside the oval office on tuesday with president trump, elon musk defended doge. >> what meaning. >> does democracy. >> actually have. >> if the people cannot vote and have their will be decided by their. >> elected representatives. >> in the form of the. >> president and the senate and the. >> house. >> then we don't live in a democracy. >> we live. >> in a bureaucracy.

>> so it's. >> incredibly important that we close that feedback loop. we fix that feedback loop, and that the public, the public's elected representatives, the president, the house and. >> the senate. >> decide what happens as opposed to a large unelected bureaucracy. >> joining us right now is joe lonsdale, a founding partner and co-founder of palantir. there's about 100 things that we want to talk about joe, including doge, including open ai and yes, carried interest. given our conversation on x over the weekend about that. but let me start on the open ai musk front, if you will, because i know that you're a backer of his proposal. or maybe we should call it a hostile bid for openai, which is a not for profit. tell us how it came about. what's your involvement in it? i think we're all trying to understand what's really going on there. >> good morning andrew. >> well, listen, it's been a really fun 20 days, right? i think this administration, with elon's help. >> and with.

>> president trump in charge, is winning more than we've ever seen before in 30 years. we've done what we haven't, you know, you know, we couldn't we couldn't do this much. >> in the last. >> few generations. and i, you know, for me. >> i just think this is such a. >> cool time for our civilization. i'm really bullish on what elon is doing. and listen, i, i know both elon and sam and. >> and you know. elon really. >> helped create openai. >> what sam's done. >> with it's amazing. >> what if elon wants to. >> do something? >> i'm going. >> to i'm going to support him though. >> you know, just from a legal perspective. you know, i spent the past 48 hours trying to look through what's happening here. it feels like just so we're on the same page that the bid itself dead on arrival, insofar as the board of openai, which is a not for profit given its current structure at least has actually zero obligation fiduciary duty, if you will, to return to the investors who've invested in the subsidiary. so just because there's a bid doesn't mean that it has to be taken or even taken seriously,

because the only thing that they the only duty they have is to the quote, mission of the not for profit charter, which then raises all sorts of questions about, you know, what the bid is really all about, a lot of speculation that really what it is, is an effort to try to create a floor or a valuation metric, which would make it tougher, frankly, for openai to become a for profit because some of the ags could get involved and start to look at, you know, what's called fair value, and they might look at the bid as a potential metric to sort of set against. do you feel like, i mean, can you just speak to what's happening here? because i think everybody who's looking at it just on its face says it can't really be what it is. >> well, listen, this is obviously a sensitive. >> legal situation. >> andrew. >> and i'm. >> not the spokesperson. >> for what's going on. >> so i want to be really. careful what i say. what i will. >> tell you is. >> that. >> you know, elon really helped. >> create. >> openai and. >> helped create the mission at. >> the very. >> beginning, probably wouldn't

exist without him. and, you know, i think the mission was it's supposed. >> to be. >> open and it's not. but, but and yet it has done amazing things for the world. and listen, if elon were to be able to buy it, i think it'd be a great thing for the world. some people disagree, but he's, he's he's making a he's making a serious bid. and when, when my friend who i think is, you know, right now the most important person in the. >> world. >> wants to do something. i got to support him. >> let's talk about doge. i think there's a lot of people that are super excited about trying to get to the bottom of and find all sorts of things in the government that maybe we shouldn't be spending our money on. that's that's the one side of it. and then obviously, you've seen some of the treasury secretaries and others, you know, write public letters in the new york times and elsewhere, frustrated and concerned about what they would say is the transparency of the process, not about the good news of the transparency of what we may learn, but how this is all being done. what do you think about that?

>> well, i. >> mean, what i think is that, like i said, in 20 days, we've done what we couldn't do in multiple generations. we have this permanent bureaucracy, andrew. and it's just it's just shocking what they're uncovering. >> like, i knew. >> there was waste. i one of the only guys who've been speaking out very boldly in the last ten years about how badly this needs to be cut, how badly we need to get into these things. there's even more waste than even i thought. and i was probably on the most extreme side of people saying, this is ridiculous and broken, right? so, i mean, it's just it's just amazing what they're uncovering everywhere they go here. i think they are being quite transparent about the things they're finding. i think a lot more will continue to come out and but but i mean, i mean, you know, it's not being transparent is the mainstream media right now is not being transparent about how ludicrous these things they are that they're finding because it's afraid to offend its readers and its listeners on the left overall. i mean, this is we're living in different realities in our country right now because one side is reporting, you know, hundreds of crazy things. there's all these scams around the world. there's all this money clearly being wasted, there's all this grift being stolen. there's money going to, frankly, to media as well as as you've seen, which is really

crazy. and, and the other side is just not even reporting on the things that are being found. so, you know, in general, in general, i think this is an amazing what they're doing. i think they should keep doing it really boldly. the executive order yesterday for employees out for every employee, and they're going to make it more efficient. it's very clear these employees are not working efficiently. i mean, this is this is awesome stuff. and what's happening, you know, elon made a great point. i was involved as a kid at paypal a little bit. whenever you'd turn off fraud or grift or change something, the people would scream the most were the fraudsters. and so the noise is mostly coming. >> from, can i. i think i'm going to i hope, i hope you will think i'm coming to this from a place i know you're going to say mainstream media, but i hope you'll i think that a lot of the grift terrible. and i'm i'm very supportive of the idea of trying to expose all the grift. i think we've been reporting on it quite regularly, actually. i think that the question and i think we should continue to support trying to find as much grift as possible at the same time, i

would think for the for the purposes of exposing that grift and making it all work as a country, you want the process to be as credible as possible. so to the extent that there are people who say to themselves, not about whether they're worried about what the fraud is or not, but to say, you know, are these things going? is this data being used in some way? we don't know. is it going into an ai system that we don't know about? are the people who are finding the grift government employees, have they been vetted? i mean, isn't it best couldn't couldn't you walk and chew gum at the same time? meaning get all of the grift, expose all of it in the best way possible, and have the process be so credible that everybody says, oh my goodness, never. >> you could never have everyone say that. >> well, that's what i'm. >> asking the judge, right? they're going to be angry. but listen, andrew, i mean, what we had to do here is that there's been layers of bureaucracy. like, i have mentors in the reagan administration who came in looking for these things, and those people were not technical. and so when they went to the bureaucracy and they asked

questions, there's so many ways to obscuring and blocking and deterring. and so what elon did is he got root access and he went to the tech systems themselves. no one has done this in ever. like no president ever has had tech people around him. and they went to the systems and they started finding things like, oh my goodness. and these people who work for the agencies to try to confront them and say, no, you can't look at the systems. you can't. you're getting around all of our ability to block all this stuff. we thought you'd never actually get to see any of this, and they're freaking out because they're looking. and so it's very transparent. they went to the systems, they actually saw the payments, and the payments were going out to crazy. there were payments to dual people with same security, social security numbers, their payments to people with no social security numbers to 100 billion. there's like it's like it's like it's everywhere. there's payments to internews network, which is trading media all around the world. how to have a certain point of view. that's a very left point of view. their payments to protesters around the world, there's like all this stuff that's crazy. and they're being very transparent. yes, we went to the data and we found it. it's only been 20 days. like give them a chance. they're going to they're going to put all of this out. they already are putting a lot out. i mean i

think this is amazing. but but but people want to slow them down. they want to slow them down from stopping their grift is really the biggest question here. >> hey, joe, i. am all in favor of stopping all of those things that you just listed. my concern comes in with the idea of freezing payments, let's say, to the nih, to cancer payments, some of the legitimate aid that was going out through us. >> aid. >> to help starving kids in africa, or some of those things. i'd love to. go after the grift and the fraud and. the crazy, wasteful things that you just laid out without freezing. everything and assuming that everything is, you know, guilty until proven innocent. with some of these issues, there. >> are. >> legitimate nih thing. i think the nih thing you're seeing is that we're changing the overhead to 15%, as opposed to, you know, if you and i were going to start something for cancer research for our family, we'd give them the money and say, 15 or. >> 20%, right? >> yeah, that's fine, but but it used to be 60, 70%. >> with that. but we're talking about some stuff that was already promised from last october with the fiscal year and different things i get changing things going forward. i think

retroactively. changing things is a little more complicated. makes perfect sense to lay that out. and in the meantime, there are freezes and serious questions at universities and research institutes about what they can and can't do. and it's creating a backlog for stuff in some cases, you know, again, where people are going into trials thinking that this is their last try. i mean, that that to me, joe, i get it. and i understand getting to 15 or 20% because that is what private donors pay. understand all of those things. it's just the chaos that ensues in. >> the meantime. >> around stuff that is very legitimate. >> i think. i think the legitimate stuff needs to be turned back on. i think you'd be surprised how much is actually not legitimate and how much is actually being wasted. and i think there's going to be a lot of yelling, pretending things are legitimate that actually weren't. but listen, my friends work with the bush administration and they saved millions of lives in africa. i do think africa can now pay for more of this themselves. south africa is spending money suing israel. they're spending money supporting political parties, calling for the death for white people. maybe they should redirect that money to pay for their own clinics. and so in

some of these cases, we shouldn't be paying for them anymore. but but you know, i agree with you. there were some very good things that went on to i think the good stuff will get turned back on, but there's a lot that needs to be turned off first. >> do you think, joe one one just related thing, do you think just in the whole process that there's that there should be a lot more sensitivity, but to be more careful? we were talking earlier about this comment that that elon had tweeted out about the, you know, the $50 million of condoms that was originally sent or. >> said. >> they were for gaza. turns out there's a gaza at another part of africa. yeah. >> and i get it. but and the reason i, the reason i mention this though is, you know, i remember when that tweet went out, it went out everywhere. i remember reading about it. everyone was reading about it, talking about it, saying, this is crazy. there were people talking about is this an effort to control population growth in among palestinians? i mean, right, it turned into this sort of wild conversation. and then we realize after the fact that it's not accurate. and of

course, most people are never going to realize it wasn't accurate. i mean, maybe they will now because we're talking about it and it was in the oval office. the question. >> was there was also public health stuff going to gaza. that was ridiculous. this is obviously silly. >> by the way. i'm not suggesting that that that i'm not suggesting the underlying question about whether we should be spending $50 million on condoms in, in mozambique or in, in gaza. gaza is the right thing. that's not. >> but the substance is. then why worry about on the edges that that's not the worry. yeah. >> that's not. >> the first thing i think of. first thing i think of. >> is. >> wow, there's a lot of grift. this is ridiculous. shouldn't be happening. and there will be some mistakes, as elon said yesterday. but that's not what i focus on, is just. >> a well, just. >> talk about throwing the baby out with the bathwater. that's what you come away with that it was. it was. >> i just think there's a question about how careful either elon or others need to be given the. >> slash and burn a lot of this stuff. >> and we've been careful for.

>> 50 years. right. we've been we've been you have a bunch of white flag republicans. you have a bunch of people on the left making money off of people, right? making money off of it to everyone wants to be careful and keep it going, that you're not going to get perfect answers in life. i think this is by far the best thing for our civilization is to very boldly confront this. and this is more, i guess, of a tech world way than a dc way. you're probably right that there are going to be some things need to be turned back on. there's going to be some things that were mislabeled that no one knew what they were. but it's a mess. and so, so it's a mess. and it's such a mess that i think being bold is the right answer. i, i get it's going to have a few mistakes, but i'd rather have those few mistakes and fix it. >> and i think, look, part of this, this may be very deliberate because part of the washington grinding machine is don't worry, we will survive this too. you know, we'll we'll live through this because the washington grinding machine always slows. >> everything to. >> a complete stop and nothing gets done. i think the my guess is that this was a pretty deliberate attempt or a pretty deliberate decision to do it this way, just to make sure that you actually. >> make some progress. >> being careful and slow isn't

how we get to mars, so you know it is. >> what it. >> is, joe. i mean, the deep state is still going to win no matter how. don't you think, joe? i mean it despite. >> the fact i think they've met. i think they've met their match. >> maybe they met their match. >> but. >> i think. >> they met. you can't. i just don't think you can possibly. joe, go too hard. >> we were going to talk and we still i still want to talk about carried interest. that's why we originally had this debate. >> yeah. >> make your case because you look most a lot of people and you said it online even in your business don't like to come out publicly in favor of carried interest or at least to speak, you know, vociferously about it. you think it is a very important tax treatment for your industry. so the floor is yours. make the case and we can talk about it. >> listen, i think i think president trump is winning every day right now. i'm a huge fan. tax policy is a great way to use like you said, to everyone off for me. but listen, there's a couple of things they're thinking of changing. the biggest one is the state and local tax deduction. that's $1 trillion question. the carried interest one is like a $10

billion question versus $1 trillion question. so it's a very small amount of tax. and what people are saying is that it's unfair that we get long term capital gains treatment. now i'll tell you the reason america has long term capital gains treatment in general is not because of a fairness issue. it's about fairness. let's give more money to middle class and working class. i'm 100% aligned. president trump's going to do that with chips. and et cetera. the reason we have long term capital gains as a framework is it is it unlocks capital, frees problems. and so when you are, you know, i'm going to be fine no matter what. but when other people who are managing money, like in venture capital or in long term private equity, when they when they have a win and they've been building the company over multiple years, then they get the share as a percentage of their carry. so just like the founders, just like the employees, just like the investors, they get those shares. and if you have a 23% rate, it's a much more likely they'll reallocate the money than if you give a 60% tax hike and have a 37% rate, which is what some people are talking about. and that's the same reason we have long term capital gains in general. you don't want to do capital frees. it'd be it'd be crazy to do a 60%

capital gains effectively tax hike on these people who own shares, who are the innovators in our economy, right. when as jd is talking about ai is going to make us more prosperous, it's going to be really good for our country. we want to reallocate to new projects. >> okay, joe, here's where i'm going to. i'm going to come on the other side of this. capital gains was built to incentivize, as i think it should, more investment in america. we are trying to get americans to invest their own capital, not other people's capital, but their own capital. and we give a better tax treatment for that. ordinary income is for your labor. everybody's labor, i believe, is the labor. i don't believe there's a special form of labor for one particular class over somebody else, which is, by the way, what carried interest. this particular moment is. as for incentives, to me, assuming that you and everybody in the private equity and venture capital business actually are committed to your own fiduciary duty for your investors whose capital you're allocating, it shouldn't matter

what the tax rate is for you personally, because the argument should be that you would be making those investments, buying and selling assets based on your fiduciary duty to those whom you represent. >> you're missing. you're missing. you're missing something there, andrew. when we when we have a big win, what happens is you distribute the shares for almost always in the biggest wins. and so you end up with shares actually. and it's not even both what you're both the new tax the tax. you don't get taxing on the shares right away. you end up with those shares. now the question is when you sell those shares, are you going to get the 23 or the 37%? the reason it's 23 is because you might own those shares another five years, and then you pay it when you sell. that's how it always works. now it's how it's going to work even under the new code. and so that's really important. it's like you're owning this thing you've been working on. you want to have the capital gains tax to be the same reallocation incentive. i'm talking about system incentives here. now. totally agree with you tax tax rich people more. stop letting them take money offshore for reinsurance scams and hedge funds. there's so many ways that we should tax rich people more. but the incentives are long term. when we get shares for

having built something. >> well, with the exception of founder shares, i was going to say most employees don't even get this benefit, which is to say, you know, if you have rsus or in most cases, options, most options, there are certain kinds of options, but that's limited at $100,000. even those folks are not getting the benefits. so to the extent that the venture community or the private equity community says, well, look, it's like we're an employee of the company, we're giving our sweat equity. you know, every employee in america is giving their sweat equity to all sorts of businesses. that's what they're doing. and they pay ordinary income on their sweat equity. if you put money into the company and if you do, which i know you do, that portion of your of the capital obviously should get paid at a capital gains rate, but i'm not sure why this particular construct is the one construct in the entire universe where effectively the sweat equity should be paid at a different rate. >> well. >> i've helped thousands of employees who work for me buying their options and get long term capital gains. and so there

there are, there are there are thousands to do that. you're right. later stage in the company it's harder. but this, this this, this this, you know, look at the system incentives. we're arguing about $10 billion here at most over ten years. you know, i think the bigger thing that will all your viewers off is the state and local tax deductions. it's at 1.3 trillion. i don't think they should get that back in new york and california, but not now. my partners in california will be angry at me. >> joe lonsdale we love the conversation always. we deeply appreciate it and we love doing it here on tv. and i enjoy doing it on social media and else. so thank you. good to see you, sir. >> all right. >> still to come. this morning, former house speaker kevin. >> mccarthy on the budget battle in washington and. later lyft ceo david risher joins us after reporting results last night. shares of the company are down after a disappointing outlook. squawk box will be right back. it's no secret bitcoin is stronger than ever. over the

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with the last comment so. >> well let's rock and roll. >> yeah you're going to disagree with that. >> no. >> it's just. >> interesting on this day that jay powell is going before. right. >> and we'll see what the inflation we'll see. >> he's about to. >> say about the real estate guy. we know i mean you know the beautiful gaza strip i mean he's a real estate guy. for more on the markets let's get to mike santoli at the nyse. what's going on mike. >> yeah joe i mean look this market is just incredibly well behaved if you want to call it that. in balance. look at the s&p 500 kind of taking in all of these sort of policy hints and you know all the sort of volatility and maybe what's going to going to come on that front and staying pretty steady. we've gone above 6100 a few times each of the last three fridays. never held above there. so kind of bumping up around that level. you're doing it with fewer very large stocks propelling us to the upside. take a look here at the s&p 500 excluding the magnificent seven. yeah there's an etf for that. which year to date is handily

beating the s&p 500 itself. so obviously been weighed down by things like tesla. and microsoft hasn't really done much. and so this broadening of the market away from those mega-cap tech stocks everyone's been calling for, it's sort of happening. it's a little bit below the surface. i've been skeptical that it can happen kind of on the fly. with the overall uptrend just continuing undisturbed. but so far that is what's going on. i did want to point out too, though. there's still this really active retail trader segment of this market. every day there's some kind of new penny stock that starts to fly crypto, obviously very active. take a look at robinhood, which is going to be reporting earnings after the close today alongside its competitors interactive brokers and schwab. this is a six month chart. robinhood up close to 200%. it's just massively valued per account and per dollar of client assets relative to those other guys. but everyone feels like it's a leveraged trade on that retail excitement. joe. >> hey, they told me to. no crosstalk. mike i'm sorry. we're both.

>> well, we always listen, right? >> we're both poor for. >> that, but we got to go. thanks. >> coming up, we've got breaking cpi inflation data. that's at 830 eastern time. but next, former house speaker kevin mccarthy is going to join us to talk about the gop and how it's preparing to kick things into gear on president trump's biggest priorities. we'll break it all down with him after this. >> sometimes investing. >> can feel. >> so all. >> over. >> the place. >> that's why. >> public.com created one place for it all, one place where you can. invest in. almost everything like. >> stocks. >> options. bonds and crypto. you can even lock in a 6% or higher yield. because it's the one place where you can build. your portfolio the way you want.

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mistakes and basically to learn as you go. that's why i. >> think it's such ae time to dt

time consignors get $100 extra terms apply. >> senate republicans set to begin marking up a budget resolution today. the house is expected to begin moving tomorrow, but there's still a lot of disagreement over whether president trump's priorities should be packaged into one or multiple bills. joining us now, former house speaker kevin mccarthy. he is now chairman of the alpha institute. what do we call you now, kevin, i guess. yeah. you. kevin. how you doing, kevin? >> i'm doing well. >> very good. trying to think of how to get into this, i it's interesting that the house seems to be kind of solid, that the senate seems to be solid, but they want to do different things. you know, one wants a wall, the other one wants tax cuts. so i don't know where the disagreement comes in. but on the party itself, kevin, think about the nominees that are

going to get in. i mean, that's a reflection of i think, trump's hold over the republican. only one guy didn't get in. we don't need to mention any names. i know you probably like to, but but only one of the nominees probably isn't going to make it. does that mean that that the house is solid under whatever we tried the republicans tried to do here? are they solid? is there not going to be one of those, you know, one of those freedom caucus revolts? no. i think what you have to read is president. >> trump is stronger. >> than he's. >> ever been. >> not just. >> in. >> the republican. >> party. >> but with america itself. he he's bringing. independents and democrats along. >> because he's doing exactly what. >> he said. >> he would do. >> and why. >> he. >> got elected. >> the real. >> mvp up. >> on the hill, though, is. >> the senate. >> and i got to give a lot of. >> credit to john thune. >> think about this. >> they've been able to. >> do all these. >> confirmations, even. though the democrats are putting. >> up every roadblock. >> they're getting. >> that done. >> and now they're going to. >> mark up a budget. >> reconciliation before. >> the house. and the house.

>> isn't even agreed to whether. this could come out. i think the chairman. >> of. >> ways and. >> means. >> jason smith, is right. >> doing one. >> bill would be the best way to go forward. but i'm. >> interesting to see. >> this this. >> number that comes. >> out of the budget. >> in the. >> house, if they're. >> really marking. >> to. >> 4.5 trillion, that means you're not even doing the full tax bill as. >> it is. >> today for. another ten years. that's not including salt. that's not taking away tax on tips or overtime. the things. that president trump wants. and i know. >> at the end of the day, the president is going to get his way. >> so i'm not sure what. >> the. >> house has been doing this entire time. >> and then. >> you've got. government funding coming up next month. >> so it seems as though they've wasted a lot. >> of time. the senate has. >> used their time wisely. >> but i think jason smith, the chairman of ways. and means, has been correct about. >> this. >> and they should really follow. >> his direction. >> but so what? how do you get there? what needs to what needs. and it's a lot of sausage we're talking about that we're making here. but how.

>> do you just so the viewers. >> understand. >> to be able. >> to. >> go to reconciliation, which allows you to pass. >> this tax. >> bill without. >> 60 votes in the. >> senate, it's the. strength of. >> having. >> the house and. >> the. >> senate. >> both chambers have to pass. the same. budget reconciliation bill right now. that's not the case. >> the senate's. >> going forward with. >> a smaller one. >> just to deal. >> with the. >> border defense perspective. >> and then the. >> house wants to be. >> able to deal with the tax bill. >> just to keep. >> the tax. >> bill, as we have now with no. >> changes. >> costs about $4.6 trillion. but if you. >> add salt. tax on. >> tips overtime. >> you're going. to need. >> about another trillion. but the house. >> budget committee looks like they want to mark. >> up to 4.5. >> so that would mean you're. >> not doing the. >> tax bill for another. >> ten years. >> you're not adding the. president's request. there has. >> to be a. >> better direction. >> here while at the same. >> time. >> what are we doing. >> about government. >> funding that's coming. >> due on. >> march 14th? and what are you doing about. the debt ceiling? >> you'd like. >> to get that out.

>> of the. >> way so you could. >> really focus. >> on the. >> reconciliation. >> but it. >> doesn't seem. >> that both are. >> connected together. focusing on the same plant. >> so how do you handicap it? i mean, will there be one bill and who needs to talk to whom and who needs to come to jesus? who needs that moment? well. >> i. >> think the entire house has to be in one place for the. >> house to strength. as you're sitting here. >> talking. >> whether it can pass the house. >> that answers the. >> question, whether you need. >> one bill or not. >> because if it's. >> so hard to pass something like. >> this that. >> the president. >> wants. >> how can you do. >> this two times? >> it's very difficult. >> so you'd want to get it. >> all done. >> in one. >> bill, which. >> you can do. >> but it doesn't look. >> like that. >> number is coming out of. >> the budget. >> so the house doesn't look like they're in the right place. >> the senate has another plan. >> because they don't want to wait around for the house, because they've waited this amount of time. and they haven't. >> done anything. >> the senate. >> has. >> been doing. >> confirmations. >> so they're going. >> to. >> move on a reconciliation plan that takes. >> up two bills. and at.

>> the end. >> of the. >> day, whoever. >> does the work will actually win. so if the house does their job, they could still be in the forefront, but they haven't done their job yet. >> how do you see the we're seeing some friction between the judiciary and the executive branch now with doge. and it is kind of interesting because you can find in the 13 districts, you can find someone that will do whatever you want is fine. if you're a democrat, you can find you can you can shop the districts or. >> the. >> courts to get a. decision that. >> you want. yes, politically. >> so that's what we're seeing. so how do you get around that? what do you what do you think. and then you're going to be accused of, you know, ending as we know it, the constitution, if you even question a far left judge out in district nine, if you even raise an eyebrow, although it was done all the time in the last minute, you know, the whole supreme. they want to stack the supreme court, but you can't question a district judge. you know, out in california you have the. ability

to appeal. >> as well. but let's. >> remember this. they did this exact. >> same tactic. >> against president trump. >> so he couldn't even run. >> he never. >> gives up. >> and this is a. >> this is a. big fight because. >> think about how. >> big this bureaucracy is. >> and it's never. >> been audited. >> as you. >> go through this. >> and this. >> is. >> shining new light. >> you've got. >> different eyes. >> coming in and seeing. >> and the more transparency. >> it is. >> i would. >> always bet on president. >> trump and elon musk. >> at the end of the day, and they're not going to give up. >> so yes, there will be roadblocks. >> they will try to do these court actions, but i think they stay the course. >> they can appeal and they. >> keep moving forward. >> the american public. >> is with them. this is what. >> they voted for. >> you're like in the private sector now. you still got that capitol thing behind you. they're like. >> well, i'm in d.c. today. >> it's nice and snowy. it's just like a false avatar. you are not speaker. >> no, that's an actual window. that's an actual window. >> with real. >> i know. >> the real, but it has nothing to do with you anymore. you're

you're a mover and a shaker. i love. my country. >> i love my country. i want to help. >> we'll see you again. thanks. thanks for. did you. are you a contributor anywhere yet? no. did you do that? i do. >> this for the. >> love of. >> just answering your questions. >> i know we love you, too. >> all right. >> it's nice. >> it is. wow. >> makes us. >> really likes us. >> he likes us. >> he really likes us. >> all right, when we come back, we do. >> have breaking inflation data coming. >> we're going to be getting. >> january cpi numbers. >> but up. >> next. before that the ceo. >> of lyft will join us. >> fresh off fourth quarter >> fresh off fourth quarter results. squawk (♪♪) car, this isn't the way home. that's right james, it isn't. car, where are we going? we're here. (♪♪) surprise!!! the future isn't scary. not investing in it is. car, were you in on this? nothing gets by you james. nasdaq-100 innovators. one etf. before investing, carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com

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businesses. >> brian sullivan joins. >> kelly evans. >> power lunch. >> weekdays two eastern. >> cnbc. >> 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. >> drafted to. >> welcome back to squawk box. lyft shares dropping sharply after the company released fourth quarter results. lyft forecast current quarter gross bookings below the estimates. joining us right now first on cnbc is lyft ceo david risher. it's great to see you, david. let's talk about these earnings because in many ways you know it's been still a remarkable

ride up. and yet in terms of what the expectations were a little lighter than some had expected. what say you. >> well good morning. >> andrew and i have a. >> lot to say. >> i have a. >> lot to say. >> so today. >> you got a big audience. i'm not going. >> to be talking to. >> traders out there. traders? you are on my fecal. >> roster today. >> but i do want. >> to talk to team members and investors. >> here's what happened. team members. >> crushed it. >> right. so this is the year that we delivered over 44 million people and got them where they needed to go. >> those are the riders. >> we did $16 billion. >> in bookings. >> that's an. >> all time high. of course, we have more high frequency riders than we've ever had. we've got drivers who. >> like. >> a 16 percentage points better. >> than they do. >> the other guy. >> we got gaap. >> profitability this year for the first time ever, we printed. $766 million. >> of cash. >> this year. free cash flow positive for the first year ever. so it is a. >> frigging machine. >> what we have built together. >> and i think what. >> the future holds is. >> great because it's a huge market and. we're doing a great job. >> so then we got to figure out

how. >> to get the traders. >> sort of on the on. >> the bus. >> but that's the. >> well, that's what i was going to ask. do you think that the analysts do you think that you missed, or do you think the analysts missed? well. >> i mean, look, i don't i. >> can't speak for the analysts. i can tell you this. >> we have never been in. >> a stronger position. right. as i say, we're executing. >> look, we. >> will pick you up. >> here's a fun fact. >> we pick you up. >> now a minute. faster on average than we did a year ago. by the way, that's actually about 30s. faster than. our bigger competitor, which is a big friggin deal. >> and we're just getting. >> started in terms of. >> upping service. >> which. >> is really our focus. >> and we did it profitably. we printed cash. >> so that's. >> kind of my focus. >> talk about just from an operational perspective. how do you do that? meaning how is it that you're getting to the rider a minute earlier than than? i think what you're arguing uber is doing without saying. >> the word? >> i mean. >> it earlier. >> than a year ago. >> and about 30s. faster than. >> the other guys. you know, we do. >> it in. >> so. >> many ways. >> we do it in so many ways. >> from the minute you open your app, our our math. guys are.

>> behind the scenes. >> trying to figure out what the closest. >> match is. we're trying to give drivers. >> better offers. here's the. >> thing if. >> you. >> give drivers. >> better offers. >> and pay them more. >> they will accept. >> rides. >> faster and they'll cancel less. so it used to be two years ago when i started. drivers might cancel 15%. >> of the time. >> you know. >> which is you get that kind of weird thing where it says your driver is canceled. we're finding a new one super irritating. now, people do that a lot less because we give better offers and we do it more clearly. that means they can pick you. >> up faster. >> so it's. everything from modeling to sort of. >> human behavior. >> and we're just doing it in an excellent. >> way in terms. okay. so that's on the operations side. and that's the good news. walk us through just what the impact of this delta partnership. going to uber though means because i know that's going to that's that there will be an impact in q2. yeah. >> that's it'll. >> sort of. >> be. >> a 1. >> to 2%. impact over the rest. >> of the year. >> look, partners. from time. >> to. >> time change. >> you know, i always say i've been married. >> 29 years, so i'm. >> not. >> i'm not a big, you know. >> change out the partner guy. >> but sometimes. >> people reevaluate. >> they kind of see. >> something different. >> or they kind of want to go a different, different direction.

>> we've got a great set. >> of partnerships that. >> we're. >> super proud of. >> including doordash. >> one of our. >> newest partnerships. >> by the way. we just. launched the doordash partnership a couple. >> of. >> months ago. >> and we've already. >> given 8 million. >> rides to. >> people who. >> are dashpass members, who want to ride on lyft and get a great deal. >> so. >> you know. >> partners kind of shift around a little bit, but the delta piece will cost us maybe a point or two. >> do you wish that you had been able to keep that? would it have cost you too much to do it? what happened? >> it wasn't so much. that i. >> think they. >> were looking for something a. >> little bit different. >> as. >> they refreshed. >> their skymiles program, but. >> we've got other. >> partners that we that we work with. >> just as well. >> yeah. >> i'd say. >> that's kind of the and. >> maybe to sort. >> of the. >> bigger point. >> i think. >> a lot of people of course it's human nature. right. >> you focus on sort. >> of the short term stuff. >> but when we. >> look at our three year goals, we're so much on track on that, that. >> i think that's the. >> bigger thing that we tend to look at. >> okay, so let's go out to maybe 5 or 10 year goals and talk about autonomous, because that's the other sort of i know i know it's a it's a ways away, but it's not that far away. right. you have a new

partnership with mobileye, uber obviously partnering with waymo. make the make make the mobileye argument to us. >> sure. >> yeah. so mobileye is one of the world's great. >> sort of tech companies. >> when it comes to self-driving. >> and really driver. >> assistance technology, right? >> i mean, driver. >> assistance is lane assist. >> it's. >> you. >> know. >> smart cruise control, all. >> these sorts. >> of things. >> and they're in 800. >> different vehicles today. they've been early pioneers in self-driving. >> they were actually. >> tesla's earliest kind of partner before tesla decided to go. >> their own way. >> and they're. >> a. >> great company. so we have created. >> an arrangement with them. >> where as they build. >> their tech, when. >> their tech shows up in pick a car, might be a. >> volkswagen. >> might be a bmw, might be a. >> hyundai someday. >> who knows? those cars. >> will be. >> lyft ready. they'll all be able to go on the lyft platform and start. >> you know, kind of. >> earning money for you as a self-driving car, if that's what you're looking for. >> we also. >> added a. >> new partner two days. >> ago called marubeni, a. >> big japanese. >> trading company. >> and they're in the lease financing business and the and the sort of fleet operation business. and so they'll be great partners to help

commercialize these types of deals. >> david, we got to go because we got data. but i do have to ask you, and i think, you know, this waymo, just their technology is way out front. i would i mean i think it's almost empirical right now in terms of what they've been able to do even relative to tesla. >> yeah. >> look, when you put mobileye even behind them, i mean, just in terms of where things are. >> no. for sure. look, waymo. >> is. >> doing amazing work. >> and they're. >> you know. >> we. we talk to all these companies all. >> the time. >> there'll be a lot. >> of different technologies when it comes to self-driving. you know already today you've got waymo. you've got cruise of course although. >> they're. >> not. >> operational. >> david i'm. >> sorry david. >> the futures. >> are tanking based on some data that's out right now. you're now looking at the dow futures. >> off. >> 222 points. let's get right to rick santelli. he has that cpi number. >> yes it's hot data. we look at yields. >> moving up pre-opening. >> equities moving down. >> january read. >> on cpi up half. >> of 1%. >> up half of 1%. >> we're looking. >> for up. >> 3/10 in the rearview mirror. >> up 4/10. >> and i do caution there's annual revisions. coming out.

>> so some of my comps may change. >> but at this point to find a. >> higher number. >> than 0.5, you're going all the way back to june of 22. we've had plenty. >> of 0.5. >> but that's where the higher number is. and if we strip out the all important food and energy also hotter up 4/10 double what's in the rear. view mirror equals several occasions. but the highest number to be a higher number 0.5 would be april of 23. if we look at the year over year data up. >> 3% on the. >> headline year over. >> year, one tenth hotter. >> than both front. >> and back. >> and if we look at 3.0, it would be the warmest going back to may of 24. now let's look at year over year and strip. >> out the all important food and energy. >> also hotter 3.3 we're looking for. 3.1 rear view mirrors. >> 3.2. >> to find a higher number, you're going to may of. 24 on the indexes. remember these go back quite a ways. and are.

>> we making. >> new highs here. yes new high 317.67 on the non-seasonally adjusted. if we look at quarter three 2474. also a new high. there's never been higher indices. >> on either. >> headline or core. and i also would like to throw a little water on the conventional wisdom that january is this big important reset. i looked at 21, 22, 23 and 24. >> four years. >> post covid. >> and maybe one. >> time in. >> every synopsis. so whether it's headline year over year was january the highest? there was many where it was equal to other months, but predominantly we saw many february and march's that were higher. so the reset, i don't know that i buy into it, but in either case, if there are resets this month certainly looks like one. back to you. >> all right, rick. >> stay with us. let's very quickly look through. >> these boards again. as rick was pointing out. we are we looked at the equities tank. you're now looking at the dow

futures off by about 400 points just over. 400 points s&p futures are down by 57 nasdaq indicated down by more than 220 points. if you've been watching treasuries we did see a very significant tick up in treasuries as well. the ten year, which was trading i think at about 453 this morning, we started saw all the way up to 461 the two years at 437. joining us right now for more on this information is priya misra. she is the fixed income portfolio manager at j.p. morgan asset management. >> drew matus. >> is the head. >> of global economic and market strategy. >> team at metlife. >> investment management. and drew, let's just start with you. markets didn't like this. >> no. >> you know. >> the focus. >> was going to be on the core year over year three. >> two would have been bad. >> and what we. >> got. >> was worse. right. >> so you know. >> it's really. >> disappointing news for the fed that they were hoping for continued deceleration. >> it's disappointing. >> for the market because they're hoping for continued deceleration. >> and the fact that this is a january number and. >> doesn't include. >> any potential tariff impact. >> yet, you know, means.

>> that, you. >> know, the risk going forward is for potentially higher inflation. >> it comes. after donald trump put out on truth social, the idea that the fed should be lowering rates to go along with the tariffs that we could be at this time. >> this puts the fed in a pretty tight box. >> it's hard pressed for them to be able to lower rates at this point. >> well it does i mean you need. >> to. >> you know, they shouldn't have been lowering rates in the first place. so that's they kind. >> of got themselves into a box. >> they tried to get in front. of things heading into the election. >> and they. >> went a little too far, too fast. and then they continued easing, even when, you know, everything should have been telling them that. >> they. >> should have been stopping. this is that nascent inflation that we were worried was was, you know, in the back of our minds, we were worried that it was still there. well, isn't that what what we're seeing right now? this is like our worst nightmare coming true. we didn't do anything. we didn't do any tariffs yet. this is this was already coming, wasn't it? >> but what. >> i would say is. >> the last mile of inflation. there's some research that's hard. >> i mean we have.

>> that's my heart. >> nine, eight 9% on inflation to. >> three going back up. we're not we're not going. >> well i think you know january. >> now a mile and a quarter. it's now a mile and a quarter for you. >> so there is this. >> seasonal aspect to the start of the year. you know the first quarter. >> has been high. >> i think there's some of that. look at the totality of inflation pce, pce is heading lower. i look at wages and wages are showing you some signs that it's decelerating. i think the fed is going to be on hold. i completely agree with you. and i think we're going to watch the data. but i would say for the treasury market, one of the reasons we. >> got. >> to that 480 was talk of fiscal stimulus. i mean, there's this inflation fear. i hear you and i think that's why the market's reacting today. what do we hear on taxes. >> are we. >> going to hear deficit finance tax cuts. we're going to go up a lot more in rates. we're not hearing that. we're hearing doge. we're hearing where are we cutting spending. we're hearing about offsets. i think that's what's going to contain the treasury market beyond this inflation fear that i think is legit. and it's going to keep the fed on hold. >> well. and the risk with inflation right. >> now and. >> you're seeing it.

>> in the data. you're seeing it in. >> consumer credit data for december which. >> was crazy. >> which is people are cutting their savings. they're boosting the amount of money they're borrowing in order to maintain their standard of living, because inflation is kind of eroding their wages faster than they can keep up. and so there's a lot of pressure on on consumers right now. and this just keeps the pressure on consumers. and it's a problem. and it's going to be a problem the fed's going to have to address. >> at some point. >> which i think you're seeing in the market response, is the idea that not only. >> are the. >> fed not going to be cutting, but it's only a very short step. >> to the. >> idea that the fed is going to have to reverse course. >> that's what i was going to say, rick. we spoke with. >> jeremy siegel half an hour ago, and he had me convinced i was going right along with this whole idea that. >> the fed. >> is less important at this moment, that it's kind of on the back burner. and we're watching everything in washington. but a number like this puts the fed front and center again. >> well, if the professor was saying on the back burner, because trump is going to take the front burner, that may or may not be correct. it's kind of a political statement. joe's right at this point. everything

we're seeing is at the feet of the fed. okay. and i'll tell you what. in many ways, the fed hasn't done a really bad job. i think that, you know, there's no crystal ball here. and on some level, there is a reduction of debt when you have inflation. and when we talk about the policies of trump, i know it's all going to be about the dark side. but let me tell you, if the average american's got any chance to keep up with these type of inflation rates, and it. isn't only the net change. now, if you go back to january, february of 2020 and you look at the cumulative compounded path of inflation, it's pretty rough on many people in the country. and the best way to help them out is to grow the economy. you cannot possibly contemplate the negative consequences of letting taxes go up at this point. in my opinion, i think it's all about trying to do growth in terms of tariffs. listen, i'm no tariff expert. we haven't really gone and seen them have a front row seat yet. the data will show

some of these effects two or 3 or 4 months down the road. but at this point it's pretty clear inflation is metastasized in the us economy. we still have strong fumes of the overspending of the biden administration. now, the real issue is with the fed's target rate at 2% and pretty much all the year over year data shows us that 3% is probably the new floor. we have to draw our own conclusions for how fed policy will change. but i'll tell you this i don't contemplate them moving rates much at all. so the other side of the professor's argument is correct, because i think you're going to see the yield curve. steepen. and i think that, all things being equal, the fed's balance sheet is too big to get aggressive. >> i think. >> that was his point. he said that doge is doing a lot of really good things. we don't know what's going to happen with tariffs. doge the market's love at this point. but his point was the fed was not going to be the center of the action. but i think we have to watch this pretty closely. i think president trump wants the fed to

be kind of going along with part of these issues. this this just puts them in a box. >> i don't think there's any doubt about that. i'm not sure. listen, everybody wants something. you know, i'd like to have a new ferrari. the president would like to have lower rates. his background is in an industry that, of course, thrives on lower rates. but wanting them, hoping for them and doing anything to actually make it happen in a direct way. i don't think that's. on the menu at all. but yeah, i don't see the fed doing much at all, and i think the current rate can work even if inflation stays on this kind of steady, not going much lower path. >> you know. >> priya, part. >> of what we're watching is the ten year now at. >> 463, the 30. >> years at almost 483, actually, it just ticked at 483. that raises questions about mortgage rates too, and just the affordability of housing and the idea that that was going to be part of what brought down inflation to begin with, the rent component getting a little cheaper on these issues.

>> exactly. >> i think. >> the. >> fact that that the ten year is sort of getting stuck here or rising is going to hurt housing. you know, the fed cut 100 basis. >> points and the ten year actually went up 100 basis points. so did they ease financial conditions. they help the equity market. financial conditions are probably where they were before they started cutting rates. so i think what. >> small businesses and for consumers. >> exactly. and i think this this bifurcated economy remains i think there's so much policy uncertainty. what i'm now watching is the job market is business sentiment. do companies say with all this uncertainty, let's maybe cut back a little bit. and so what's holding up. the consumer has been the strong job market. if that starts to slow down a little bit hiring intentions slow down capex slows down. then you're going to see the fed saying we've got a dual mandate, pce is still not that high. and look, the job market is starting to slow. and that's the argument for them to, i think, retain that easing bias, which is why i think these level of rates you're giving getting all in yields in fixed income, high quality fixed income, five and a half, 6%. if you go a

little bit down the credit spectrum, 7%. amidst all this policy uncertainty, i think this is why fixed income has so much value. >> drew, a 450 point drop on the dow is not what it used to be, but you're still looking at equity markets that are very highly valued and lots of questions about what comes next. >> what do. >> you do with this information. and watching the market's reaction to this? well, i tell people. >> it's the market reaction is overdone. yeah i think, you know, if we talk about a little bit of inflation, you know. >> the. >> idea that it was going to stay sticky. >> is not unusual. >> so we're really talking about a 30 or 40 basis points of additional inflation. you know for me the real key is what's productivity over the next ten years. and that we're going to see play out in the equity space. right. we're going to see the companies that are going to drive productivity for the next ten years in the equity space. and if we get. >> productivity high enough, the budget deficit doesn't matter. >> because we will. >> get. potential growth high enough. >> that we can actually then grow our way out. >> of a. >> deficit story and the debt story. and so for.

>> me. >> you know. >> and this. >> is to professor siegel's comments, you know, doge matters if. >> they can. >> if they can somehow reduce spending and kind of get us there. and then if we get the. >> boost from ai. >> that people are expecting everything to. >> work out on doge. >> i mean, it's been a long it's been since my lehman brothers days with. priya that i've looked at the budget deficit that closely. >> but. >> you know, half a trillion, i think is kind of a reasonable number. that'd be that'd be a very rough guess in terms of annually. annually. >> what does that do to growth. that's the concern, right. if they're going to cut that much, is growth going to struggle? i mean i'm all for efficiencies, but what's the collateral damage in trying to get that efficiency? if you're going to cut a bunch of spending that's an immediate hit to growth. >> well, i guess i'm assuming that, you know, i'm taking the government efficiency component of it at its word. so you don't actually you cut the spending, but you actually don't really cut the services being provided. hey, rick, i'm seeing it already. it's the animal spirits

of people anticipating the tariffs, even though there aren't any tariffs. >> but is it pulling forward ordering stuff? >> there it is. it's they're raising price. this is trump. that's what i'm saying. that's what i and we're going to. and the eggs and the eggs that he i don't know how he did that. >> but look jim farley and all these other guys there there are. >> so even though this is january and it was come in on january 20th, right. you know. >> all of think about. >> you don't think this is any biden. this is residual. >> all these will. >> be. >> all of these automakers in the u.s. are going back and forth between the border 100 times a day. >> so they've already raised. >> prices trying to bring as much stuff into the country. i know, but. >> are you. >> saying this? >> let's go ahead. >> with some balance here. let's bring some balance here. let's say everything you're saying is correct and people's hair is on fire. and multitude of industries, even though at this point this does look like a january reset, as i said in the past, it really doesn't seem to be something that works. but

let's say it's all true. on drugs and in the end, six months, nine months, a year down the road after we break some eggs to make the omelet, we see that there's improvement, that his strategy is bringing improvement. so then we reprice and we reprice better than we started. i don't know how bad these tariffs are going to be, but i have faith that what we are doing is the right thing. and when our guest just now, priya talked about spending and growth, just look at what baseline spending was in 2019 and 2020 and look what it is today. we could easily be less than a more than a trillion and still be providing the same services pre-covid. the problem is, i don't think d.o.j. is going to be able to do these numbers, trying to get a dollar out of any place the government gives. it is nearly impossible. >> rick. >> is there any way that since january 20th, the narrative and the discussion about tariffs seeped into the cpi numbers for

january? and this is not residual from the biden? i mean, could you really make that case with a straight face because i know it's going to happen. >> no. absolutely not. >> it's impossible. >> to make. >> that case because it's. >> of. >> course they're going to do it. but but like i said, look at the numbers that are in our society. oh, the january reset. go back and look at january in 2021, two, three and four in every category. it's rare that january is the highest. so listen, they can't even look at history and get it right. >> rick. we will do this again tomorrow with the ppi. priya drew, thank you guys both for being here. >> all right. coming up, former fed governor rick mishkin is going to join us on the new cpi data. there goes our 125 basis points that we were counting on points that we were counting on from a (vo) weight loss. for so long, i felt stuck. but zepbound means change. zepbound is for adults with obesity to help lose weight and keep it off. it's changing what i believe is possible when it comes to weight loss.

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as your host, i have some rules. first, no showers longer than 5 minutes. this isn't a spa. (laughs) that's a rule. meanwhile, at a vrbo— when other vacation rentals make you share your turf with a host, try one that's all yours. reserve. former fed governor rick mishkin. he's now columbia university professor and a cnbc contributor. and you know things come in vogue. things go out of vogue. rick. there was a time after the 50 basis points, sort of surprise, shock and awe cut. and then a couple more. there was a time where people said, are you sure that inflation has been put to bed in the last mile is tough? and you know, the economy? i are you sure the risks are symmetrical? because

the economy jobs market were holding up pretty well. so there was a there's a question as to why cut. i mean, is that being borne out now that that mission accomplished, that banner was put up too soon? >> yeah. you know, i actually thought that. the i mean, in hindsight, but the 50 basis point cut was, was. >> actually a mistake. >> you know, it came after they thought they made a mistake when they didn't cut. >> and in. >> fact. >> the numbers. >> came in a little. >> weaker than they expected. but the bottom line is that the mission is not accomplished. the inflation. is falling. but on the other hand, it's sort of stalled at a level which is. >> above the. >> the fed's 2% inflation. >> target that the job market. if anything, the. >> labor market is. >> still slightly on the tight side and the fed's maybe a little. >> bit restrictive. >> in. >> terms of its numbers. >> but but. >> not that restrictive. and then, you. >> know. >> we have a. >> lot of. >> uncertainty about what's going to happen, particularly in terms of tariffs. and that's like. a self-inflicted supply

shock a negative supply shock. >> it's going to. >> hurt the. >> us. economy but. >> also raise inflation. >> and it's being done. >> you know usually we get those because something bad happens. but in this case it's something that that the trump administration is pushing very hard. >> right. and with what's maybe still in the pipeline combined with, you know, these proposed tariffs, which, you know, some are coming even sooner maybe than march 1st, the president saying that interest rates should be lowered. i mean, that is it's maybe interest rates should be actually if you got tariffs coming and you've got residual inflation from whatever caused it, you know, to get to 40 year highs, it's not a time you're going to be cutting rates. you might be raising rates. >> well yeah i. >> don't think the fed has. >> to. think about raising. >> rates at this at. >> this point. >> there's still. >> what about. >> if tariffs come. what if there's tariffs. what if there's another couple of hot prints. >> yeah the tariffs are complicated. but they are supply shock. and typically the fed

looks through those supply shocks. it doesn't try to react to them too much. but on the other. hand you know look that these policies are not particularly helpful that trump is a low interest rate man. you know he said he's a tariff man. he loves tariffs. he also loves low interest rates. this is one of the reasons why it's very important to have an independent fed that is able to look to the long term, not to and not sort of get into these short short term type thinking. but, you know, politicians do this all the time. trump is no exception, maybe a little more extreme on some things, but he's. certainly no exception. >> to. >> the typical politician who who always would like the fed to goose up the economy and create jobs. >> but but that's. >> not the fed's job. the fed's job is to basically keep a good long run policy that keeps inflation under control, which is a pro-growth policy. that's what the fed is supposed to do. >> and. >> i think, you know, jay certainly understands this. and the. fed as an. >> institution understands this. >> and, you know, trump can say

what ever he wants. the big issue is going to come up when he's getting ready. >> to appoint a new fed chairman. >> that's when things. >> really become much more complicated. >> right now. >> the fed's. >> just going to ignore what trump is saying. >> not what. >> he's. >> doing. >> because that can affect. >> numbers. >> but what he's saying in his push on them. they resisted very well in the past during his first administration. they're just going. >> to do it again. >> why would not why wouldn't the recent some of the cool numbers we saw on inflation, you know, not this month, but previously. why wouldn't those be the lows? why should there be. we have any hope that that we're not now that we haven't. maybe the inflection point hasn't been reached. it'd have to be a weaker economy, wouldn't it? would there be any reason for inflation to come down from where it is right now? and if not, we're no we aren't at 2%. so i don't i don't see why. you know, i don't understand why we're going to have more cuts. do you think they think we'll get a weaker economy that will help. otherwise inflation is headed. back up. >> i think. >> this is why the fed basically

now is in a pause. >> phase. >> that they're basically just going to be in wait. >> and see. >> that they're. still mildly restrictive. and also one of the things that that. that as long as the fed has credibility to get inflation down, inflation will gravitate. >> to 2%. that 2%. >> target really does help in that regard to. basically give an anchor to where the inflation. >> is going to. >> going to go. >> and in fact, you know, when i was on the board of governors and people would frequently say, you know, what was your prediction for inflation? i would say, well, you know, i think inflation and expectation is still rock solid. >> at 2%. >> they'll head there. so i think it depends a lot on on what the numbers are. the fed i think has been handling itself quite well. since 2022 when it previously. >> made. >> some bad mistakes but turned things around very quickly. >> and i think. >> they'll do the job. and i think the markets understand that they'll do the job as well. well. >> we've got ppi tomorrow. all right rick michigan, thanks for coming right back. >> you're very welcome. >> so what. >> is this? nothing stands still. not technology, not the

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than anticipated consumer price index number inflation showing up at 0.5% month over month for january up 3% year over year. both those numbers hotter than anticipated. and you saw what happened to the dow. it's now indicated down 400 points s&p futures are down by 58. the nasdaq futures off by about 2229 230 points. it's all happening while treasury yields are on the on the rise 4.63%. we started

ten basis points below this to three hours ago. so we'll keep an eye on that. >> we go back to not knowing what's going on. >> no no no i liked that. >> i liked it better. ignorance is ignorance is bliss. the first data point we're getting is not tomorrow. >> we get the ppi. >> we get producer. >> prices and we will see. make sure you join us for that. right now it's time for squawk on the street. >> good wednesday morning. >> welcome to squawk on the street. >> i'm carl quintanilla. >> with sara. >> eisen and mike. >> santoli at post. >> nine of the new. >> york stock exchange. >> cramer and. >> faber have the morning off. >> futures do. >> fall out of. >> bed here as january cpi. comes in hotter than expected. >> up. >> 5/10. >> the biggest. >> monthly jump since 22 year. >> on year. core ticks up. >> to. >> 3.3. >> and the ten year yields now 4.62. >> that's almost. >> a one. >> month high. >> a roadmap. >> begins with elon. >> musk defending. >> doge in the oval yesterday. >> making the case for the group's. >> aggressive actions. >> in this new administration. >> speaking of musk. >> shares of tesla trying to avoid. >> their s