box begins right now. >> oh good. >> morning everybody. >> welcome to squawk box right here on cnbc. we are live from the nasdaq market site in times square. i'm becky quick along with joe kernan and andrew ross sorkin. it's a monday morning for us. >> sort of even. >> though it's tuesday. we're here. >> markets are back. >> open again. >> it feels like a monday. you're going to see right now that we're looking at some green arrows at the open. the nasdaq closed at an all time high on friday. it's indicated up another 100 points. this morning almost. dow futures up by about 35. and then you've got the s&p futures up by 18. and i think right now the dow is just only a little bit from one one more than 1% from the all time high. the s&p is only a quarter percentage point from an all time high. it does come after a

week of gains for the markets, where the dow was up by 6/10 of a percent, the s&p was up by 1.5%, and the nasdaq was up by 2.6%. here's where we stand for the year so far. the dow is actually up by 4.7%. the s&p is up by 4%, and the nasdaq is up by 3.7%. yesterday, the wall street journal had a story about how investors are much more nervous because we're at these pretty lofty levels, maybe the most nervous they've been in a couple of years. but we'll continue to watch and see. and these are the gains that you've already seen for the year to date. treasury yields this morning. it looks like the ten year is right around 4.5%. yeah. just over that at 4.507. the two year is at 427. and then you've got bitcoin that looks this morning that it is around 95,000 $95,713 per bitcoin. >> meantime let's see about this delta airlines regional jet, which i'm sure many of you have seen. at least images of it crashed while landing yesterday at toronto's international airport. the flight taking off

from minneapolis saint paul. all 80 passengers and crew were evacuated. 18 injured people were taken to local hospitals. at least three, we should mention, did have critical but not life threatening injuries, one of whom was a child, a passenger on the flight telling cnn they were they hit the ground hard. then the plane went sideways. flipped upside down. and the toronto airport has now been closed. two rail, two runways as it investigates the crash. phil lebeau is going to join us in just a little bit to bring us more information on the crash at 830, but when you see a plane upside down like that and you see images and video, don't know if you saw some of the passengers taking video as they were evacuating from the plane. it's just another scary incident. we've had a whole bunch of them. >> since the beginning. >> of this year. >> since the beginning of this year. >> i was actually on a plane reading about it in the last half hour coming in, and there was a lot of. >> turbulence because of those high winds. >> my daughter flew into dca and said it was, i.

>> know you. >> can't help but. >> look around when. >> you're coming down. >> with what happened. >> that happened there with. >> the couple of weeks ago. >> meantime, southwest airlines plan to cut 15% of its corporate workforce, or about 1750 jobs. it's the first mass layoff in the airline's 53 year history. southwest has been facing pressure to try to rein in expenses, including from activist investor elliott management and ceo bob jordan said the decision was a difficult and monumental shift. but corporate overhead, he says, has been growing faster than the rest of the airline's operation. >> and a new wall street journal report says that elon musk d.o.j. team is seeking access to data systems within the irs that the house that housed personal taxpayer information. the report says that access hadn't been granted as of yesterday morning, but it was considered an urgent goal by the doge team. a white house spokesman told the journal

waste, fraud and abuse have been deeply entrenched in our broken system for far too long, and it takes direct access to a system or to the system to identify and fix it separately. an effort by doge officials to obtain sensitive records at the social security administration prompted the resignation of acting commissioner michelle king. king served at the administration for more than 30 years. she was named acting commissioner back in january. the doge team published a website detailing the savings it says it has made so far, totaling $55 billion. it ranks the biggest cuts as coming from usaid, the department of education and the office of personnel management. and it posted a wall of receipts detailing cuts that it has made. meantime, in a court filing yesterday, the white house said senior or said elon musk is a senior adviser to the president and not an employee specifically

of doge. it said he has no decision making authority and can only advise the president and communicate the president's directives. the filing specifically says that musk is not the administrator of the us doge service, but it does not specify who is or if there is one. >> i guess it's because of conflict. >> of interest policies. >> that's probably. >> the reason. >> for the. >> but for the for the technical. >> nature of this. >> but i think in reality, obviously elon is running. >> doge, right? >> he's got trump's blessing to run it. separately, a judge has. temporarily blocked some mass terminations at the consumer financial protection. bureau in a ruling on friday. the judge ruled that the bureau could not terminate employees without cause. the order prevents any mass firings and prohibits the deletion of agency data. stay tuned. >> meantime, new overnight elon musk x.ai releasing its latest artificial intelligence model. it's called grok three at a demonstration streamed on x

mustang. they believe grok three is an order of magnitude more capable than grok two in a very short period of time. the team claimed that an early iteration of grok had been given a better ratings than competitors on chat bot arena. that's a crowd sourced website that pits different ai models against each other in blind tests. now, grok three will be rolled out to premium x subscribers today. then after that will become accessible through a separate subscription for the web and app versions. and i am looking forward to playing with it. >> new york governor. >> kathy hochul. >> said last night. >> that she plans to meet with new. york city. leaders today to consider how to bring. >> stability to the. >> city's government. >> that could include removing. >> mayor adams eric adams from office. that is a power that's granted to the. >> governor by the. city's charter. hochul said, in her. >> words. overturning the will of the voters is a serious step that should not be taken lightly. that said, the alleged conduct at city hall that has been reported over the past. >> two. >> weeks is troubling and cannot be ignored. president trump's

justice department recently ordered manhattan prosecutors to drop their bribery case against the mayor. he had been charged with taking illegal campaign contributions from turkey and accepting $100,000 in travel and hotel perks in exchange for official acts. he has denied wrongdoing. several top prosecutors resigned over the decision to drop the charges. yesterday for new york city, deputy mayors announced their resignation. >> i mean, this case is unbelievable. i don't know what you guys all think of it, but the fact that, i mean, the mayor of new york is now a hostage of is a hostage. that's what he is. >> he's a hostage of the white house. it's at this probably wasn't done in a very tough way, but the justice department can decide. >> whether the. >> charges were serious enough to pursue. that's. that's what they do. $100,000. i think he should be charged with. being so inept. at taking. decent bribes. i mean, if you look at, i mean, $100,000 menendez or any, any good politician should be ashamed if they got a couple of

upgrades and $100,000 gone. he's now gone. but take your pick. so, you know, biden has now gone to see the i don't have it. he's a democrat. yeah. he's here. i thought you liked him as a mayor. i've been on his side. if you. i don't have a strong feeling. you want to get rid of him? get rid of him? that's fine. no. >> i think right now there's a major conundrum here. there's three things going on here within the justice department. there's the lead. the leader. of the southern district in this case, who was a clear conservative. >> right over the way it was done. i've seen conservatives criticizing what they. >> resigned from her job because she said that she couldn't in good conscience go through with this because of the quid pro quo. so that's one piece of it that's going. >> to explain the quid pro quo. >> and the quid pro, the quid. >> pro quo, being that he is not going to be prosecuted so long as he participates in helps with the immigration issue here in new york. >> which is a good thing. right?

>> it's a very interesting thing because it goes back to. >> whether you're a quid pro quo where we want something from, we want it's good that. >> you've got the mayor. >> of new york city on board with with efforts to clean up the city. >> in the. in the. criminal set up. it says, if you don't. >> i know if i. >> if you don't. >> do it, then i'll be up your if you prosecute him right home and said, i'll be up your if you're. not supposed to use. that's a worthy goal, that it's a worthy goal, but you're not supposed. >> to use the legal system like that. you're just not. it's a it is a con. >> that is people. like i've said again and again, i'm glad you're. >> on the case. >> no, i am, i'm glad we got the fourth estate looking at everything again. and i just think it's good. it's good to hold politicians to power. and i'm i'm behind you 100% on this. we got to do it. it's awesome. welcome back. >> secretary of. >> state. >> marco rubio is in saudi arabia for the highest profile talks with russia since its invasion of ukraine. secretary rubio is accompanied by national security advisor mike waltz and

middle east envoy steve witkoff. they plan to meet with the delegation from russia. yesterday, the state department described the talks as an opportunity to explore russia's intentions on the conflict in ukraine and other central issues in ukraine won't be represented currently at these talks, but u.s. officials said ukraine will have a seat at the table for. normal or formal negotiations to end the conflict are convened later. the head of nato. very interesting what he said, because they definitely wanted him to say, this. >> is crazy. what's happening with europe. >> and he said europe needs to get its act together. >> and i'm. >> behind what. >> what president trump is doing. >> unequivocally. so i don't know how this plays out. i guess in the end, this is what you'd want, if it can be done in a way that. >> ukraine is, you. >> know, feels that it hasn't totally given up everything and in some type of fair settlement.

but you want this war to end. >> zelensky has not been happy that they don't have a seat at the table. >> well, they will eventually. >> but did you see this? >> the proposal made by the for the wearer's. we've given them 200 billion so far. how much do you think is fair for us to try to recoup? well. >> it looks. >> like we're going for 500 billion. >> we may end up in for 500. >> i think the i think. >> the way. >> it was laid out, it was seen as stiffer. >> you're not on the united states, germany, ukraine side in this. >> but you. >> know. >> zelensky has said that he thinks it's fair to have to have some give back for all of this. i think the. >> terms i think the default is that, yeah, we should get something. i don't know why the. default is. >> well, no, but i'm. >> not saying we shouldn't. >> get anything. the question is. >> are we asking for too much. >> by the. >> way, i think zelensky. >> would like it because it would keep us skin in the game. >> right? >> that was his. >> that was why. >> that's why he was the person who proposed it. right. but i don't. >> think i think he was looking for terms quite as. >> as he. >> thought they.

>> were going to be. the stonerose. exactly. when we come back, a lot more on squawk this morning. we're going to round up some fed speak over the holiday weekend, get you ready for the trading week ahead. don't go anywhere. the futures right now we've got some green on the screen 32 points on the dow nasdaq looking higher. about 90 points. the s&p 500 looking to open about 18 points higher. and then later you do not want to miss this interview. palantir ceo alex karp is going to join us to talk about his new book, the ai tech race, and so much more. that's happening in the more. that's happening in the 8:00 hour will come right back. i can't believe you corporate types are still at it. just stop calling each other rock stars. and using workday to put finance and h.r. on one platform. tim, you are a rock star. using responsible ai doesn't make you a rock star. it kinda does. you are not rock stars. (clears throat) okay. most of you are not rock stars. oooh. data driven insights, and large language models. oh, that's so rock roll. it is, right. he gets it. yeah. (grandpa) i'm the richest guy in the world.

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now. >> some fed speak over the holiday weekend. yesterday, fed governor michele bowman saying that monetary policy is in a good place, but she wants to see data reflects more progress on inflation before cutting interest rates further. meantime, overnight in australia, fed governor christopher waller making some similar comments. he said the central bank should cut interest rates further if inflation makes more progress back towards target. but he said the fed should cut even if trump, the trump administration policies are adding economic uncertainty. the next fed meeting is scheduled for one month from today. for more on all of this and the markets over the holiday weekend, and what is a holiday shortened week, i should say some stocks to watch. i want to bring in sylvia jablonski, ceo and chief investment officer of defiance etfs. and before we even get to some stocks to watch, i'm curious what you made of that, that journal article becky was mentioning yesterday because it did appear yesterday. today it's in the physical paper. i don't know if you saw

it just about how pessimistic the investor class, at least retail wise, seems to be. >> yeah. >> i think. >> you know, some of the retail. investors out. there are a little bit worried about. >> valuations and. that the. >> market has. >> run up as much as it has last. >> year and now into. >> this year. but you know. >> what i would say about that is. >> that i think. >> that there's. >> a chance. >> that this market continues to run up for the next couple of years, if not the next 5 to 10 years. right. we have this. good kind of roaring 2020s. type of backdrop here where inflation is falling. not exactly where we want it to. >> be, but it's going. >> the right way. directionally, we have a fed that. is poised. >> to. >> keep rates. >> steady or at. >> least cut rates. earnings are looking good. jobs numbers are looking pretty steady. consumer sentiment is solid. and these companies are returning great earnings. >> you know. >> you have 72%. >> beating. >> on eps. another 64% on revenues year over year. blended growth rate is 16%. the market looks pretty good to me here. >> okay. so it's looking really good to you or pretty good to

you. what would you be buying. >> yeah. so i we've. >> talked about. >> this. >> one before, but. >> i tend. >> to. >> be a big fan of where where the puck is going. >> in terms of technology. >> and innovation. i think you have some leaders in the quantum. computing space that got knocked down over the last couple of months. you know, granted, they've recovered a little bit, but i think. >> that's. >> you know, the future. >> of tech. >> so i like names. >> like d-wave. >> their expertise is quantum annealing. so it's already something that they're doing now. it's not 15 to 20 years out. you know they essentially have to optimize workflows. driverless car maps, cryptography optimization things like this ionq. i think if nvidia is the poster child for ai, ionq. >> could be the. >> poster child for. >> quantum computing. >> their customers include. >> aws, alphabet, astrazeneca. >> they have some government contracts for quantum computing. and this is. >> really. >> the future. >> of tech. >> so you said inflation is headed the right direction. haven't we had three straight months where it was. >> it's headed the. >> wrong direction. >> yeah i. >> think well. >> i said.

>> stable and or the right direction. >> but yeah. >> i. mean i. think there. >> is some. >> fears about inflation popping. >> up and you. >> know, that might leave rates where they are for a little bit longer than the market expects. but it doesn't seem like the market is as reactive to. bad news as as we were. >> last year, for example. >> and so i think the data will be, you know, critical there. and if we kind of like really go awry and keep going the wrong direction, that perhaps can pull equities back. but i think that inflation is in a fairly stable spot. and we'll have to see what it looks like month over month. >> well. >> yeah, i don't know how. >> seems like it's headed up. >> but if it. >> did head down or moderate it seems like it'd be because of economic weakness. so then then you got the flip side for. why the market might be. you know, i feel bad because i feel like a retail investor. i've been worried about valuations. i don't want to be a retail investor because a lot of times they're wrong. but you know, you're coming into a market that the trump administration. >> at 22. >> times earnings thinking about tariffs. so the whole setup

seems like it could be ripe for what we haven't seen in a while. and that is a pullback 1,015%. >> yeah i. mean i think. >> we'll have to see how it all plays out. if inflation stays between that you know. 2 to 3% near that 3% range. >> you have gdp between. >> 2 and. >> 3% tariffs. >> you know we have to kind of see how that plays out right. how much of that is the art of the deal versus what actually gets placed on these different countries. and then, you know, how does that actually improve. domestic growth and supply chains? >> and. >> you know, the possibility to. feel gdp for there. so i think we have to see how all of this lands. i'm not as i'm not so worried that inflation is going. to meaningfully spike. >> you know we yes, we've had a couple of. >> of poor reads. >> but prior to that we. >> had a good run. >> of, you know, inflation. >> going in the right direction too. so it will be it will be very much data dependent. and the fed seems to be doing the right thing and pausing. >> and waiting to see what happens here. so they're not you know, they're. >> not. kind of. >> like consistently cutting rates and putting.

>> us back in that. situation where we. >> were a few. >> years ago, where we were talking about whether or not it's transitory. right. so we kind of have to see what happens. i think the data will dictate that. >> hey. >> silvia, before you go. >> real quick. >> you named a couple things you'd buy. what would you sell right now? >> yeah. so i think. >> i tend to be a long term collector of stocks. i'm not really looking. >> to necessarily. >> sell anything in my portfolio. >> i guess. >> if, you know, if i had to give you an answer. >> here, it'd probably be probably be small caps. right now. i like the x-mag, the 497, you know, minus the or sorry, the 493. >> minus the. >> s&p 500. so kind of the other s&p 500. names outside of mag seven. but i think small caps aren't doing. enough for me here. >> okay. we're going to leave it there silvia. thank you. >> appreciate it. thank you. >> you bet. >> all right. coming up, new survey data on the health of small businesses. we've got that next. squawk box will be right back.

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(♪♪) (♪♪) trading session, working the phones, talking to sources and doing my own reporting to share insights. >> information. >> and all of the details that you need to be able to make money. >> welcome back everybody. >> cnbc and survey monkey survey monkey monkey releasing. >> sorry a little punch drunk here. >> releasing the latest small business. confidence survey for the first quarter of 2025. brandon gomez joins us right now with more on what we learned from those results. this is pretty interesting survey. >> hey good morning becky. yeah. look the headline is small business confidence is down. but

owners are generally happier. some tempering sentiment skyrocketed post trump election in q4. the small business index trending lower now at 56. now the question is why? well, there was an increase in negativity on a few questions that shaped the index. several surrounding president trump's various policy proposals trade, immigration expectations for regulation. >> but when you. >> asked how would you rate the current state of the economy, 4 in 10 small business owners are optimistic, saying they view it as excellent or good. and that's up from the previous quarter, driven by increased positivity among republican business owners. at 31%, half of democrats small business owners agreeing in terms of what's on small business owners minds, consumers demand supply chain disruption and tariffs at just 10% of a concern. but a quarter cite inflation as the biggest risk to their business. currently, just 36% of business owners say they believe that inflation has reached a peak, while two and three believe prices will continue to rise. becky. >> that's maybe the most concerning piece of that entire

survey. 63%, almost two thirds think inflation is going to continue to rise. and they would know they're on the front lines. >> and the issue is still split 5050 on whether or not they believe. and i believe we have this graphic as well, whether or not the fed can actually get a hold on inflation as well. so there's still some some concern about how the macro factors are going to be playing into and any issues that really impact the customer. obviously, those small business owners are going to be prioritizing those concerns. we saw, again, tariffs, inflation. >> those. >> types of issues. >> well. >> not only are they potentially fueling inflation on the front lines. still trying to get hiring. small businesses have have dealt with a lot more from the higher rates as they exist right now. they don't have access to credit the same the same way some big businesses do. so they are still paying more. for any loans that they have to take out, that's an issue too. if they see inflation coming, they worry that the fed may not be able to get its arms around it. they may suspect that rates go up from here. >> and that's. >> where you see the domino effect come. >> into play. they were asked if they find it more difficult to find quality workers as well.

now that's another issue that they brought up. so a lot of those again, macro factors sort of feeding into the into the beast here. >> yeah. >> and it's a very different picture for small businesses versus big businesses. we focus a lot on the big businesses. but it's interesting to see. >> what's happening. >> similar issues. paralleled in terms of. >> how they play. >> out brendan thank you. thanks. good to see you. >> coming up, the latest on the crash of that delta regional jet at the toronto airport. phil lebeau is going to join us after a quick break. then later chip makers broadcom and taiwan semi are reportedly eyeing deals to split intel into two. we're going to talk to a chip analyst going to talk to a chip analyst about that report. squawk box ♪ ("born to be wild" by steppenwolf) ♪ ♪ get your motor runnin'! ♪ (car horns blare) come on! ♪ head out on the highway! ♪ crowd: hey! hey! hey! b-12. bingo! (buttons snap) (inhaling furiously) (explosion) (car revs) (cheering and laughter) (♪♪) don't worry, girls! i've got weathertech. all together: ♪ born to be wild! ♪

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>> shop now with. >> code tr20. >> for 20% off. terms apply. >> this is. >> good morning. welcome back to squawk box right here on cnbc. we're live from the nasdaq market site in times square on this tuesday morning. kind of feels like a monday for a lot of folks. take a look at the futures right now about 45 points higher on the dow nasdaq looking to power higher as well. about 96 points higher. the s&p 500 looking to open about 20 points higher. but now we're going to talk a little well i should say airlines. but more importantly this this this terrible crash. yeah. >> let's get to phil. phil comments on on early in the investigation. but this we've

all seen it. a plane basically flipped over at toronto airport. phil amazing that there's some injuries but no loss of life, which is like. great great news. >> yeah, 100% joe. and this is a testament to. >> a couple. >> of things. one, there's luck involved. whenever there's an air crash like this, you. >> have. >> to have luck involved for people not only a few to survive, but all to survive, especially if the aircraft flipped over, then caught on fire. the canadian safety board, which is the counterpart to the ntsb. it is investigating this crash right now because it happened on canadian soil, but the ntsb and the faa will be assisting the canadians in this investigation. no fatalities. believe it or not, no fatalities. there were 18 injuries. that is a testament to. the structure of the. aircraft and the fact that the seats now in. all airplanes are made to stay attached to the frame of the fuselage, much

better than they were in the past. you might have had people ejected from seats in the past. those safety standards have changed over the last 10 to 15 years. that's one reason why you had people who were still buckled into their seats, upside down inside the fuselage, who were able to get out of the plane, and also they got out the way. >> you're supposed to. >> get out. whenever they say there's an emergency, you drop everything. you get out. you don't pick up your briefcase. if you have one, you. don't search around. >> for your purse. >> and i know people will sit there and say, well, obviously you don't do that. you know how many times if you look at video of planes that maybe skid off the runway and it's not a major disaster, but they have to deploy the slides. it's people who are worried about, do i have my backpack? do i have something else? no. >> you get out. >> and so it is remarkable that nobody died in this crash. but again, the canadian safety board, ntsb, faa all launching an investigation as to what exactly happened when the plane landed and then obviously

flipped over. >> hey, phil, can i just follow up on that? what you said about the seats being much better connected to the fuselage than used to be? >> yes. >> i mean, it's still weird to me that that nowadays, in a lot of first class places, in a lot of first class seats, they will have a shoulder strap and they yell at you if you don't put that on when you're flying. if you're in coach, there is no shoulder strap. and i can't help but go back to like, the titanic and steerage. should everybody have a shoulder strap? >> well, in a perfect world, you'd love that. and that may ultimately happen. but as of right now, when they have. look, this was a recommendation by. the ntsb a number of years ago to change the seating structure so that they were better equipped to handle a crash landing like this. i'm sure they looked at the idea of shoulder straps and they concluded, look. >> weird that some. >> seats. >> have it on. >> the plane and not everything, right? i understand what you're saying, becky, but i mean this this kind of goes back to all

things involving safety restraints with all modes of transportation. should we have safety belts inside school busses? yeah, we should, but you still see a lot that are out on the road. >> busses. it's not like you have them. it's not like you have them in the front of the bus, but not in the back of the bus. that's the weird thing. >> i understand what you're saying. i'm not arguing with you, becky. i think everybody agrees that that would be wonderful. so maybe that comes out of this. but the process. how bad were the winds? we'll start with the ntsb. >> how bad were the winds? >> and i'm just. >> how bad were the winds? >> i mean, it looked snowy. i mean. >> what was the. weather condition? and i'm just. >> trying to figure conditions were challenging. they were challenging, joe. the crosswind is what they're likely going to be looking at. i mean, the crosswind was was gusting. it was gusting anywhere. i've seen reports that it was gusting up to 35 or 40mph. there is a limit for regional jets as. >> to how. >> they can land, how great the crosswinds can be. i'm sure they wouldn't have tried it if the cross winds were above expectations or above the limit. maybe this was a gust. i mean, these are the kinds of things

that they're going to be looking into. right. >> and the investigation i'm just trying to figure out whether. >> right. >> i mean, there's times where, you know, you've you've been on flights, phil, where the wind, you can feel it. and you. >> can't believe. >> that the skill of the pilots. and it's. >> like you. >> think a lot of times being a passenger, you're thinking. >> it's more. >> dangerous than it actually is because it happens, you know, 50,000 flights a day landing. but it's. >> amazing that. >> it doesn't have more. my, my, the reason i was asking, they do have different runways. >> that the air traffic controllers. >> could switch you to if they. don't want. >> you landing. >> in a really. strong cross. i'm just trying to figure out. >> whether it's just. >> or pilot. you could be pilot error. >> joe, i've been on. >> yeah. go ahead. >> is that a possibility? pilot error will be looked at. look, these accidents. and you heard me say this a few weeks ago with washington, dc. it's never one single thing. it's usually a series of events triggered by one thing, but then it deals

with how did the pilots react? how did they handle it? did air traffic. control give clear instructions? all of these things will be looked into. and look, i've been on flights. i'm sure you guys have been on flights where you're about to land. and you, you you circle around again. or sometimes i've been about to land and they divert us off to another airport because they can't. and look, they know what the rules are. >> i will say some of the early stuff i was reading, and this is all very early, suggested that there was a bit of an error bump from a plane that came through right before it. but again, as phil says, this is going to be investigated and we will know. it's just going to take some time. >> yeah. yeah. okay, phil, thanks. let's switch gears. >> to boeing. >> which has become a target of the gop at this point. how? >> yeah. well, it has i mean, look, boeing right now is feeling pressure from not only the trump administration because over the weekend, you saw the reports that president trump toured a modified. 747 it's not

the one that's being built to be the next air force one. it's a modified one now a charter. 747. and they are looking into and really they're pressing boeing on. what's the problem? where is the new air force one that was supposed to be delivered originally by the end of 24. there are two of them that are being modified in san antonio. the original cost about $3.9 billion, but there have already been $2 billion in cost overruns. let's let's be clear here. those cost overruns, they are not being charged to the taxpayer. that's what you see. the special charges for boeing on it seems like almost a quarterly basis. boeing shareholders are the ones who are paying those cost overruns because the company is paying that, not the taxpayer. so it's not like the price is going up. but for boeing ceo kelly, this has now become a priority. he's already met with elon musk. he gave elon musk a tour of at least one of the 747 that is being modified in san antonio, and he welcomes elon musk,

saying, how can we help you get air force one delivered faster? there have been wiring issues. you had the pandemic. you had supply chain issues. the trump administration has essentially said, look, we're not going to get this plane. and by we, we mean the federal government until probably 28, 29. they would like to have it sooner. meanwhile, you've got the commerce department says it wants to hold a hearing where they can talk with kelly about the problems with regard to increasing max production. you've had the secretary of transportation saying, i'm going to meet with kelly, and i'm going to go out to renton, and i want to tour this plant before we raise the cap on seven. three seven max production, which is still at 38 per month. so boeing very much finds itself under the microscope when it comes to the gop and the trump administration. yeah, it is a. >> little. weird because you. >> can build a jet in. >> a lot less time than just. >> modifying this thing. yeah, but this is a weird joke. joe, i've talked to people who have worked on the air force one

project. very unique. you've got the department of defense. you've got the secret service. you've got the white house and you've got the department of transportation. and by the way, they all want to weigh in on what is going on with the plane as it's being built. and this is not like you and i can go and apply to boeing and they'll say, go work on air force one. you got to have security clearances for the people who are working on it. you have to have specialty, special technical skills because of the security that is built into the aircraft. it's a very, very unique aircraft project. interesting. >> so okay. >> so i'm. >> not going to order a i order a jet. >> probably not a good idea to. >> try and get a. >> can i just add to this? somebody from x points out a very good point. seat belt. shoulder harnesses are only required in seats that do not have a soft surface in front of them. coach seats all have a seat in front of them, but first class seats have a hard structure and no impact area. >> that's right. like you're the beloved pod where you get to watch the crappy hollywood

movies. >> phil, thank. >> you for your. wide ranging expertise on on all things aviation and anything that moves, anything that moves. that's an expression. anything that moves. all right. see you later. >> all right. when we come back, secretary of state. marco rubio meeting with the russian delegation today in saudi arabia, we will talk about the arabia, we will talk about the reset of relations with at morgan stanley, old school hard work meets bold new thinking. to help you see untapped possibilities and relentlessly work with you to make them real. market. >> and not franklin templeton. >> we've been a firm in motion. >> for over. >> 75 years. >> always innovating. >> today, we're a. >> leader in public and private

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>> i think your ambition is really an extension of faith. if you first off believe in yourself, that gives you the power to chase your dreams. my ambition starting out was to have a career, not a job. i wanted to be excited to go to work every day and go someplace where i could grow, learn and engage. cnbc viewers are definitely ambitious, and i think most of them see their money as a tool, a way to pursue their dreams and pursue their goals. i hope to always be a clear, accurate and investable voice for all of our viewers. you learn a lot here at cnbc. it's also a lot of fun. >> us and russia officials are gathered in riyadh, saudi arabia. today for talks to end the russia ukraine war. the highest profile talks since the invasion. the ukraine invasion itself. ukraine's prime minister volodymyr zelensky has criticized his exclusion from. >> the gathering. joining us now, victoria. >> coates, who served as. deputy national security advisor in the first trump administration. she is now vice president of the

heritage foundation's davis institute for national security and foreign policy. victoria, do you think. that zelensky should assume that the united states. will have its interests in mind? or is it a genuine concern that, you know, the united states. talking to russia is like, hey, why am i not there? you know, you guys can. >> make deals that where i. don't know. >> if my interest is being represented. is that a true concern? do you think i might be worried? >> well, good. >> morning, joe. >> and yes. >> i. >> think. >> it's perfectly. >> natural that president zelensky. >> would be. >> deeply interested. >> in the substance of the talks. >> in riyadh. >> but at the same. >> time, i. >> think this is also. >> a critical moment for. >> secretary rubio. >> to sort of take the measure. >> of. >> foreign minister lavrov. >> who's been in his position. >> for some 20 years. >> and. >> you know, to have these. >> talks take place.

>> in a neutral environment. like riyadh. >> i find it interesting that what. >> we have. >> here are. >> the world's three. >> largest energy producers. kind of gathered together. >> so i think. >> that will be an interesting. >> topic of conversation as well. but hopefully, president zelensky heard president trump say yesterday that, of course. >> you know, ukraine will be deep. >> in consultations. >> before anything is decided. so i. >> would see this is more of a get to know you kind of meeting. >> did you know. the nato head of nato, the secretary general? how long has this the latest individual? i'm shocked. >> that it. >> at some of his comments were so pro-trump. and i thought nato just bristled every time trump opened his mouth. you know, this gentleman is it pronounced route, mark, route route. >> yeah. >> he's the former. >> prime minister of. >> the netherlands. >> he became secretary. >> general of. >> nato in last summer, replacing. >> john stoltenberg. who's actually came and spoke at at

heritage this time last. >> year. which surprised. >> some. >> people that. >> that this. >> nato secretary. >> general would. >> come to our think tank. >> but even he. >> said that president trump and his first. >> term had. >> done more to revitalize nato than any previous president. and i think that's the important message. >> to our european. >> partners and allies, as well as our canadian. partners is. >> you know. >> nato holds its fate in. >> its own hands. >> you know, it is. >> not donald trump that is causing trouble for nato. it's nato's own failure to invest sufficiently in its defenses over the last 30 years. >> and the real problem. >> is. >> is math, the plans. >> that they agreed. >> to at the nato. summit summit last summer. require a 3.5% investment of gdp. in defense to. >> to make. >> those plans realistic. >> and unfortunately, when you have. >> a country like canada, the 10th biggest economy. >> on the planet. >> at 1.38. >> the math just. >> doesn't add up. >> so nato is going to have to. >> take it into its own hands. i

thought secretary general rota's comments yesterday were very strong on that. but we'll see. >> what they. >> actually do. >> was shocked. >> saying i categorically reject any. let me say i absolutely reject the criticism. the criticism of president trump's initiative. i think it's only right that he tries to end this war. but if i were. >> ukraine, i. >> don't, i don't know. let me ask something else about the rare earths and compensation. does russia already have the. >> the areas. >> where a lot of the rare earth in the valuable resources are located? >> certainly the. parts of ukraine that. >> russia is, is. is in right. >> now. >> particularly in. >> the east. do have a lot of resources, but the whole country is very rich in these things. and i think. >> this could be a way. >> for the. united states to. >> actually. >> you know. >> gain from. >> this. exchange with ukraine. >> that it's not just. disinterested charity on the part. >> of. >> of u.s. taxpayers for this

war effort, but rather an exchange between. sovereign nations and a. >> material we. >> obviously badly need. >> i mean, as you. >> start talking about. >> you. >> know. >> the kind of technologies we're going. >> to be investing in for the next 50 years. >> this, this. >> this is mission critical. and so i think a very effective way to justify the war effort. >> well, what if the united states said, yeah, we're going to, you know, we've helped ukraine, but this was your fault. russia. now you've got a lot of these rich men. we want we want some, you know, recompense from you as well. that might not go. >> over well. >> no. >> although i. >> think, you know, russia is going to. >> have. >> to be held responsible for some of the terrible destruction that's taken place in ukraine. >> that will be part. >> yeah, it's part of the negotiations, i would assume, because that's just that's a reality they're going to have to deal with. >> so this is going to happen. do you think, victoria, are you optimistic that i don't know. what do we call it a deal. are

you optimistic there will be some type. of end the hostilities through a deal? >> well, i very much hope so. >> we'll be. >> marking the third anniversary of this war in a couple of days. you know that it's been three. >> grinding years. >> it's been close. >> to. >> $200 billion out of the united states alone. you know, it really needs to come to a resolution. >> i don't think we should be. >> fighting down to the last ukrainian. so as president trump has said, we want the, the, the loss of life to end the, you know, economic destruction to end. and so. >> hopefully we'll be. >> able to get to a resolution that persuades putin that this is not something he should do. again. >> great. >> okay. >> we appreciate appreciate that analysis. victoria coates, thank you. good morning. thank you. squawk box will be right back. >> to follow your heart. >> you need to. >> think ahead. at ubs, we. match your ambition with

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>> how long those can last without being creased or. exactly broken or anything along those lines. >> and there is speculation among apple watchers that at some point, apple apple two will maybe figure out how to do this. but of course when they do it, i'm sure they'll figure out how to do it better, but they're taking their sweet time on it. >> that's what i'll wait. for when we come back. is intel about to get broken up? that stock moving higher this morning on reports that broadcom and taiwan semi could be poised to strike a deal. we're going to talk to an analyst about what this means for the sector. next we'll be right back. >> executive edge is sponsored by at&t business. next level by at&t business. next level moments need the nex 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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and restrictions apply. >> welcome back everybody. broadcom and taiwan semi are reportedly considering deals that would split intel in two. joining us right now to talk about that and much more is vivek arya bank of america senior semiconductor analyst. and vivek, let's talk about this because right now it looks like intel shares are up by about 6.5% on these reports. what do you make of them. >> good morning becky. >> i think first. >> of all, from. >> a sector perspective, consolidation has been a. >> key part. >> of. >> the. semiconductor sector over the last dozen years. every year it has made the sector a lot more profitable. you know, an average semiconductor. company has 2 or 3 times the free cash flow generation capability of an average industrial. >> company in the. >> s&p 500. what it's also. >> saying is. >> that ai has been a theme and has been a very important theme. and if you don't have an ai pipeline, then they are. then you are kind of more subject to. being taken over and being split up, which is what intel is

seeing. having said all that, i think there are challenges in any kind of potential breakup, right? we have to say that none of these companies have made any official statements. so a lot of these. are assumptions at this stage. but what makes this situation very tricky is, number one, that the way intel manufactures its products is very different than the way tsmc manufactures its products. so it's hard to. >> see tsmc. >> just essentially. >> take over all of intel's manufacturing because there are differences in the way they manufacture products. there could be synergies of scale for tsmc. and when it comes to broadcom, for them to consider intel's pc and server design business means a very extended regulatory process, especially in china. and, you know, the last time broadcom tried to buy a company back in 2017 when they tried to take over qualcomm, it took a very long time. and unfortunately it did not result in a successful endeavor. so i think a lot has to happen before we get to the other side of this. >> i agree with everything

you've just said. i guess what makes this a little different is that tsmc is kind of getting dragged into this because of a request coming from the trump administration. how does that change the scenario, the idea that the trump administration would like to see them get involved with the factories and the us has put a lot of money into several billion dollars over the last couple of years into intel, and wants to make sure that they can make sure that there are chips being manufactured in the united states. >> right. >> for sure. >> you know. >> we have seen a chips act give money to not just intel. by the way, chips act has made a lot of allocation to taiwan semi, who is also making factories in arizona. many of those factories can serve ai customers here in the us. so it's not true that intel is the only option for making advanced semiconductors in the us. you know, tsmc is an important option and is becoming a bigger option. number one. number two is that tsmc publicly

has not shown interest in buying all of intel. whether they can consider part of intel or part of intel's manufacturing is a separate situation. and maybe they could. but until you know, there is a room for all of intel's manufacturing in one clean place, even broadcom, according to media reports, is not interested in looking at the product side. so i agree with you that, you know, there is absolutely a lot of interest in making sure that intel succeeds. it's an iconic brand name, but so far there is no proposal on the table that has room for all of intel's manufacturing under one clean entity. >> so intel shares are up 6.5%, broadcom down by about 4/10 of a percent. and the last i saw taiwan semiconductor was flat. it sounds like you would not be making any moves until you hear more about what's really going on behind the scenes here. >> that's right. >> i mean, we have an underperform on intel because they don't have an ai pipeline and because their manufacturing is still significantly behind.

and just tsmc taking a small stake is not going to change any of those scenarios. so we think it's quite speculative at at this stage. >> very quickly, let me ask you about nvidia. they're going to be reporting their earnings next month there obviously or next week. they've obviously had so many questions about what's going on. post deep seek whether there's going to be demand for their chips. but we did hear from all of the big majors, whether that be amazon, meta, alphabet, any of them looking at spending even more next time around this year for capex, does that how do you feel about the shares given the pullback that we've seen in nvidia shares as a result? >> sure. absolutely. you know, when deep sea came out, somebody compared it to the sputnik moment. i think it has been kind of a sputnik moment because the us spending on defense and aerospace went up, you know, 1020 fold in the decade following that sputnik moment. so, you know, since deep sea

news came out, we have seen i think back to your point, the us hyperscalers raised their capex. what was supposed to be a 20% growth year is now over a 30% growth year. over 360 billion. we have seen stargate being announced with $500 billion of spending over multiple years. and then last week, what i think probably went unnoticed is the intention of european customers to spend. the european commission announced a ■k7200 billion program. france announced a ■k7109 billion program, all for investing in ai. so we think this is a long term theme when it comes to nvidia's earnings. specifically, they are going through a product transition. you know there are china kind of restriction headwinds. so it's possible that the quarter they guide you know might be a tad squishy. but we look forward. you know the stock is trading at the lower end of its valuation range. i think it is absolutely a leader in being able to benefit from a lot of this spending. so we would be buyers of nvidia. it's our top

pick. but as i mentioned that earnings are always a volatile time frame. but right after earnings we think nvidia is a gpu technology conference will help to put the positive momentum back in the stock. >> vivek thank you. >> thank you becky. >> it is just after 7 a.m. on the east coast. you're watching squawk box on cnbc. i'm andrew ross sorkin along with joe kernen and becky quick on a tuesday morning. that kind of feels like a monday. among today's top stories, a delta airlines regional jet crashing while landing yesterday at toronto's international airport. you've probably seen these images of this plane flipping over. the flight took off from minneapolis-saint paul. all 80 passengers and crew happily were evacuated and are safe, though we should mention that 18 people were injured and taken to local hospitals. meantime, southwest airlines plans to cut 15% of its corporate workforce, or about 1700 jobs. it's the first mass layoff in the airline's 53 year history. southwest has been facing a lot of pressure to rein in expenses, including from activist investor elliott

management and the wall street journal, reporting that elon musk's dodge team is now seeking access to data systems within the irs that house personal taxpayer information. the report saying that access hasn't been granted as of yesterday morning, but it's considered an urgent goal by the dodge team. meantime, take a look at the futures right now and green on the screen 46 points higher on the dow. nasdaq looking to power higher, about 87 points higher. the s&p 500 up about 18 points. and want to get straight over to frank holland. he's got a look at this morning's pre-market movers. good morning to you frank. >> good morning to you. and we're going to start off with chinese tech stocks taking a look getting a boost from a rare meeting between the chinese president and some of the biggest tech companies in china, the ceos of china media giant tencent, tesla competitor byd, and perhaps most notably, alibaba ceo jack ma all part of the meeting designed to give a boost to the chinese tech sector. you can see shares of alibaba. they are up just over 3% right now. also, notably, the ceos of jd.com and baidu were not present at that meeting. you can see those shares under some

pressure this morning. both jd.com and baidu both lower in the pre-market. at least the us listed shares are investors. they seem to be responding to this economic shift. overall. what it could mean for the chinese tech sector. take a look here. you see the kweb etf and also the c triple q etf both moving higher in the premarket both up just over 1%. all right moving on to another mover this morning we're talking about constellation brands. you see those shares are up just about 9%. now this move to the upside is for the maker of modelo and corona beer is after warren buffett's berkshire hathaway. it revealed a stake in the beer maker. it bought more than 5.5 million shares in constellation in q4, opening up a new position, creating a position of about $1.25 billion. also, you have to look here. you can see over here, big move to the downside after earnings on january 2nd. shares of falling double digits since then since constellation brands actually lowered its guidance for beer sales. the stake by warren buffett and berkshire hathaway seen as a sign of confidence in the beer maker despite a lot of perceived tariff risk. and last

but certainly not least, taking a look at meta shares on a 20 day win streak gaining more than 20% over that time. this morning, however, we see meta shares pulling back about a quarter of a percent, still gaining more than 20% more than 25% over that win streak. the company also announcing a major investment in robotics. and according to the company, those robotics will be focused on ai powered humanoid robots that can help with physical work. it's also forming a new unit in its reality labs division, according to other reports. it's also exploring watches and earbuds with cameras. back over to you, frank. >> thank you. watches and earbuds. what are you going to buy? >> i have. >> both i'm going to get that get that tom. brady watch which i thought was plastic. i thought it was. >> a casio. it was 700. >> so crazy. >> looking yellow. >> yeah. >> sapphires or. >> something i. >> don't know. coming up a health check on the bull. market strategist ed yardeni sees the s&p 500 at 7000 by year end.

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>> that's my. >> secret to better. >> odor control everywhere. >> there's a futures. >> this morning. upward pressure to start this session. nothing great, but not bad. on the nasdaq, which closed at a new high on friday. for more on the markets, let's bring in ed yardeni, president. >> of yardeni research. >> ed, good to see you this morning. and you have been you've been steadfast. i haven't seen you really waffle at all. you've acknowledged we may see some choppiness. and i've seen i've seen some funny things. you know, some of the strategists that come on the show. i think we had. >> one on recently.

>> that was just talking about the chaos. chaos? chaos. and that. >> there was. you know, tariffs. >> and you know. >> trump inherited this great economy and now there's chaos. and we're less we're less than a point off an all time high. and most of the averages and at all. so what. it's almost as if now it could happen any day. valuations are stretched. inflation is not put to bed. but why are you so sanguine about. reaching new heights this year to even 7000? which would be a pretty good move. what is that about? what's that? between 15 and 20%? sure. >> well, look. >> it's really. >> all about. >> the resilience. >> of the economy. it just demonstrated. >> over the past three years that it could withstand a dramatic tightening of monetary policy. the federal funds rate went from 0 to 5 and a quarter, 5.5%. and just about everybody thought that that would cause a

recession. i didn't think so. and now what's. interesting is that nobody seems to have learned from the experience of the past three years that this economy really is resilient. and i think it can take some chaos in policymaking and in tariff making. >> and i think by the end of the. >> day, anyways, i think what this administration. >> is aiming. >> for is what they said, not retaliatory tariffs, but reciprocal tariffs. and what that means is we'll match the tariffs of. >> other countries. >> and then we'll sit down with them. after postponing it for 30 days and try. >> to work out lowering of the tariffs. >> so i think that's important. i think. deregulation is an ongoing phenomenon. look. >> at the end of the day, it's really. >> all about the resilience. >> of the economy. >> the strength of the economy, which means that earnings are going to continue to be strong. and that's what i think is driving the market. i think that's what's holding up the market right now. >> that's what we need because we know that. that stretched multiples in the past, in and of

themselves don't cause the. >> market to come down. >> so correct. >> correct i don't know. i don't know whether we get. >> any expansion. we'd like some. >> rate cuts to get multiple expansion. but even if we're stuck here in the if the fed does nothing this year, there's no reason to think necessarily that something pops in terms of valuation. >> so if the so if you're right about economic. >> conditions and earnings, you. >> could get your 15% on the s&p purely from from. business doing well. >> absolutely. and i think. >> you know. >> productivity has been making a comeback. i think it continues to do so. and i think the technology revolution. >> the. >> digital revolution. >> which really started. >> with ibm mainframes. >> in the. 1950s and now has. >> evolved to ai technologies. some of them are silly and some of them are not going to going to suffer from hallucinations. >> but i. >> think the. >> what. >> we're starting to see is a lot of anecdotal evidence that

ai technologies, digital technologies, have advanced to the point where they make humanoid robotics and self-driving cars a reality here, and that not years from now, but this year, next year. so i think all that put that all together and you get the market looking. >> solidly forward. >> we were talking about this journal piece about signs of froth. and maybe some of it is, is in the retail investors. i don't know who i don't know who is the consensus or the people i want to bet against. sometimes i think it's the pros. the pros have no idea. sometimes i think it's good to bet against them. sometimes i think poor retail investors are, you know, out at the bottom, totally in at the top. so i. >> don't know. >> whether to use this as a contrarian sign or not. do you see froth or just the market being at a level that isn't justified by the underlying

fundamentals? >> well, i. >> think it. goes back. >> to what. >> you said about. >> valuation multiples. there is this reversion to the mean factor. where a lot of people believe that once you get well above the mean and everybody seems to take the average. >> of. >> history and the average of history, the mean pe should be around 15. and now for the. magnificent seven. it's more like 30. i think it's actually down a couple of points from there, from maybe 28. and then for the rest of the market, the s&p 493, it's more like 19. yeah, sure. those are stretched relative to 15. but the key point on valuation. >> is, as. >> you said, is how long is this expansion going to last. and the past three years demonstrate the resilience of the economy, suggesting that there may not be a recession between now and the end of the decade. it may turn out to be the roaring 2020s, after all. i mean, we're halfway through it. and so far, it certainly looks that way. and there's no particular reason not

to believe that a recession is going to happen. if that's the case, then there's plenty of time for earnings to grow and for valuation multiples to become less stretched. not because they take a dive on a recession, but because earnings are that are delivered are great. >> have we ever had a six, seven, eight year period without a recession? that would be unprecedented. one was the 19. >> the 1990s. immediately come to mind. i mean, we had a long period. we had a very long expansion there. and there are a lot of similarities. i've been making the similarities between now and. the in the 1920s, the i've been calling it the roaring 2020s, but there are similarities to the 1990s, the technology revolution. and, you know, i think we may actually get some fiscal discipline, believe it or not, out of all this chaos, very reminiscent of what happened with. >> clinton. >> clinton realized that the bond vigilantes limited what he could do. and i think scott bessent has been telling trump

that forget about the fed. look at the bond market. we need to convince the bond market that our policies are are going to work. >> an interesting point. you can't just you can't just jawbone. >> right. and i'm going to use did you hear i'm going to use the s and p 493 not the s&p 500 because that's at 19 times earnings. that makes me feel a lot better. and then the s&p seven the maga the maga the maga seven at 30. so the 30 skews the whole s&p up to what at 22. is that is that the. >> yeah that's. >> it's 22. and that is stretched. >> into 19. >> yeah i mean yeah. >> i mean. >> it is reminiscent of the tech bubble when we got up to 25 on the s&p 500. and by the way technology back then had a 50 had a 50 multiple. >> and it's transformative. >> i mean if i had no idea i mean i wasn't. >> krugman i didn't think the internet would. >> be like a fax machine, but i had no idea what the internet.

>> i mean. >> it is just mind boggling what we. >> i'm i'm using. >> it all the time. >> i use copilot as a research assistant, you know, and we're. looking at other applications. >> yeah. >> you're old research assistant is like sleeping in a box. i mean, that's bad. that that that that's. >> what's going. >> on, though. >> so you've got a virtual. >> assistant now? editor. >> well, i'm just using copilot microsoft. and it's technology has something called copilot and copilot. you just ask it a question. >> it gives you the. >> answer and it gives you references, by the way. so you can double check that it's not hallucinating. >> you're a one man shop now. you don't need anybody or anyone anymore, do you? >> i need my team. >> i need my team. oh, you do have a team. >> okay. >> i do have. >> a team. >> uses ai too, so they're way smarter to. >> okay. all right. ed yardeni. >> thank you. >> thank you. >> 7000 s&p 500.

>> coming up, china's president xi, in a rare meeting with some business leaders, including several chinese tech giants. what it means for ai and tech competition with the us. we're going to discuss it. and later, palantir co-founder and ceo alex karp is going to join us with a warning for silicon valley. it's going to be with us just a little over an hour. do not go little over an hour. do not go anywhere. he's never o you founded your kayak company because you love the ocean. not spreadsheets... you need to hire. i need indeed. indeed you do. our matching platform lets you spend less time searching and more time connecting with candidates. visit indeed.com/hire and with the help of financing from capitas, you can meet all of your business goals. because at capitas, we finance the

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>> join the club. >> jim cramer is an excellent teacher. i don't have the time to do this full time for the value. >> that we get. >> the investing club is very much. >> worth it. join the club. new members save with a special offer for a limited time at cnbc.com. join jim. terms and restrictions apply. >> on. >> oh welcome back to squawk box. china's president xi meeting with some of the biggest names in the country's tech sector, including alibaba's co-founder jack ma and the ceo of tencent. by byd. i should mention deep seek and others. for more on the tech, race and ai between the us and china, i want to bring in michelle guy, the ceo of purdue university's institute for tech diplomacy. she served as assistant secretary of state for global public affairs in the first trump administration. want to thank you for joining us this morning. first of all, before we get into any of it, were you

surprised that jack ma was involved in all of this? >> not surprised. >> i think we. >> were all. >> really shocked. >> when he disappeared. >> for. >> let's say, the better. >> part of four years. >> almost five years. >> but to see him reemerge. >> now, not. >> as surprising. >> because we know that general. secretary xi jinping. >> has big. >> ambitions when it comes. >> to high tech, that he wants to do. >> something to help bolster his. >> economy and then also signal geopolitically that they are here to compete and they are here to win. >> and lead in emerging technology. >> so not. a surprise, but. >> an important. reminder that the. >> ccp. >> the chinese. >> communist party. is supreme. >> and exists. >> to serve itself. so this is not pro. private sector. this is not how. >> can xi jinping help unleash. >> what they are doing? >> this is. >> if you're jack ma, if. >> you're. >> the deep sea. >> ceo. >> it's ask not what xi jinping can do. >> for you, but what. >> you can do for xi jinping. >> where do you think the us open ai and our efforts are as

it relates to china? meaning, who do you think really is leading in all of this? given some of the big questions about the success of deep sea? obviously there are also questions about how much of what they've done was stolen from the united states. >> well. >> the. >> us private sector. >> is leading. >> has been. >> leading, and i think under the current administration, we've seen a. >> renewed focus. >> on making sure that the private sector. is unleashed, that. >> we. >> are pro innovation, innovation. >> first, regulation second. >> and so i think the united states has made enormous strides with. what openai is. >> doing. >> doing in chatgpt and ai and what. >> we're doing in a number of. >> other technologies. but let's be clear that china. >> is. >> here to. >> surpass us and. >> to use their. >> high tech and their emerging technologies, whether or not they engineered it themselves or in most cases, stole some of our own intellectual property in order to set global. standards and really. >> set the values, the authoritarian. values that. >> they hold dear. to define, to

believe. >> when you look at a deep tech or even some of the other models that have come out in the last week, do you think they have access to nvidia chips that they are not supposed to have access to? or do you believe that they actually are innovating in a way to make their ai more efficient, meaning that they don't actually need as fast a chip? >> it's probably a combination. >> of both. we know that. >> they get. >> their hands on some advanced chips from nvidia. even though their export. >> controls are. >> ways for. >> them. >> to get. >> it by. >> bypassing through. >> some other countries. >> so likely. >> they have some advanced chips. >> but look. >> chinese are. >> really good at. >> engineering efficiently. we saw this way. >> back in the day with. >> bell labs. >> when they invented the. first digital switch. >> it was a big revelation. >> only months. later did china come out with their. >> own digital. >> switch that was much more efficient and cost. >> a. >> lot less. so we've seen this before. and so the imperative. >> for the united. >> states is. >> to keep innovating, to keep advancing our own. >> enterprise so that. >> we are leading and setting

the global standards for these technologies. >> for china. >> engineering or reverse engineering. michelle. it's new engineering or is. >> it stealing. >> or some some of both. >> i think. >> it's a little bit of both. >> we know, and any business leader will tell you that china has made a practice out of stealing intellectual property. they, in fact, will tell it to. >> your face. >> it's just how they do business. >> and so they take intellectual property from our most. advanced tech companies, and then they engineer it to become more efficient. it's what they've been doing for decades. and so we have to be really smart about our own export controls, whether it's nvidia chips or more advanced technologies. >> as we develop them. >> and we also have to make sure that we. are leading with our own innovation so that we are getting there faster, smarter and better, and working with our allies, by the way, in order to lead in these technologies. >> and so do you believe that we should be preventing these chips from getting to china? i mean, there is an argument to be made by some. i'm not advancing it

myself that, you know what, give them the chips that if you don't give them the chips that they're actually going to get. excuse me, get even smarter about getting more efficient. >> we should absolutely be sure that we're not giving them our most advanced chips and our most advanced technology. they have a program called military. civil fusion, and that simply means there is no separation between consumer technologies and what they use for the people's liberation army. and so any chip that we give them is going to give them a faster, more competitive advantage to fuel their military and other critical technologies that threaten the security of the united states. so the more that we can be sure to slow that down, at least not give our technology to those who are dedicated to our demise, the. >> more secure. >> we will be. >> just real. >> quick talk about the balance between innovation on one end and you were talking about regulation on the other end. i think you were suggesting we need to we need to be foot on the pedal on the innovation side. and at least for now, i don't know. i don't want to put

words in your mouth. disregard the regulation side. i'm curious how you think about that balance. only because there are folks like the ceos, by the way, of openai, also of anthropic and some of the other big, big ai companies in the united states that say, you know what? especially for some of the open source stuff, it gets scary really quickly if you don't have some guardrails on things. >> yeah, it's innovation first, regulation second, not no regulation. and i think that's that's where the united states is headed right now. we see what happens when you take a regulation first approach. you have to look no further than europe and their own self-assessment with the draghi report that came out a few months ago, that they are devastatingly behind in terms of their tech competitiveness, it's going to take 800 billion a year to try to make up for it. that's twice the percentage of gdp they spent to recover from world war two in the marshall plan. so leading with regulation is a guarantee for failure, leading with innovation, with light touch regulation is a smart

approach and that's where the united states is headed. >> michelle, i want to thank you for joining us this morning. >> thank you. >> coming up. >> elon musk releasing the latest version of grok. and you're going to test this out for me right. >> when will. >> you have. >> i'll have results by tomorrow morning. >> by tomorrow morning. >> there's a. >> tease okay. more on that next. and as we head to break, check out the shares of tesla gaining some ground this morning. still though, down about 11% year to date, but up more than 60% in the last six more than 60% in the last six months. squawk box carl: what's up, carl nation! it's your #1 broker with the best full-service wealth management skills in the biz. tech asst: actually i'm seeing something from schwab. (uh-oh) producer : yeah, schwab lets you invest and trade on your own. and if you want they can even manage it for you. not to mention, schwab has a team of specialists for taxes, insurance, and estate planning. both producers: all with low fees. carl: we're experiencing technical difficulties... uh, carl... schwab!

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>> get my body. yeah, i think i'm gonna sweat. >> elon musk's x.ai released its latest artificial intelligence model, grok three, at a demonstration streamed on x, musk said that they believe grok three is an order of magnitude more capable than grok two. in a very short period of time. the x.ai team claimed that the early iteration of grok had been given better ratings than competitors on chat bot arena. that's a crowdsourced website that pits different ai models against each other. in blind tests, grok three will be rolled out to premium x subscribers today, and will be accessible through a separate subscription for the web and app versions. when we

come back, corporate america dealing with president trump's policies, tariffs, executive orders and big changes in the government. up next, we'll talk about how ceos are navigating the current environment, and we'll talk to tennessee republican senator bill hagerty about getting a budget deal done about getting a budget deal done on capitol hill. squawk box [announcement call] final boarding call. i didn't use agentforce, the powerful ai from salesforce, so an ai agent didn't send me the fastest route to my gate, which has changed. [airport bus engine] [whistling] i'll tell the pilot to hold the plane. they've got an app for that, dude! agentforce helps heathrow create a first-class experience. agentforce. it's what ai was meant to be.

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financially. >> independent in my retirement. >> join the club. new members save with a special offer for a limited time at cnbc.com. terms and restrictions apply. >> all right welcome back everybody. let's dig into the ways ceos are navigating the trump administration. everything from analyzing a flood of executive orders to preparing their supply chains for the impact of potential tariffs and counter-tariffs. joining us right now is mark weinberger. he's former ceo and chairman of e. and mark, you've been doing this for a long time working with lots of ceos around the globe, also working with at least four different administrations, including the first trump administration, where you did serve on one of the task force. why don't you just talk about what you're hearing from ceos you talk to right now? >> sure, becky, great to see you. thanks. it's listen, generally, the business community is. very happy. around the way the business. >> environment is going. and

the. economy are reduced. >> regulations. >> more efficient government, more transactions. >> opening up because of regulatory. >> blockage not being there, energy prices going down and permitting going up. so lots of. >> of real positives. i think. >> behind companies and. >> the direction. >> of travel. >> but when. >> you get off. >> the trend. >> lines and focus on the headlines, if you do. there's a significant uncertainty tax. >> and that uncertainty tax. >> does affect the way that businesses make long term decisions. >> and with. >> any major restructuring. >> like we're seeing now. >> in the. >> economy or in. >> a. company that. >> creates some. >> some friction. and so i. >> think they're. >> a ceo. >> is looking. >> at what they can control. they're looking what they have to influence. >> and they're looking. >> what they can't control. >> and having a plan. >> for each one of them. >> and how do those buckets break down. what would you put in the things you can control, things you can't and things to be aware of. >> well, the things you can. control are your business operations, your employees

making sure you're communicating to them, telling them about the uncertainty, doing vast scenario. planning based on how your supply chains may or may not change if various executive orders. do come to fruition. if tariffs do come into place, ai transformation all that's what you control. >> what you influence is working with the government, those that are coming into office and. >> those that are already there. if you're running a. >> pharma company, you still. >> have to get fda. >> approval for all. >> of your drugs and your testing. you want. >> to make sure. >> that process is still moving. so you're trying to. influence the government where you can. and then what you. don't know, you have to be involved in your business groups, the business roundtable. >> and others. >> to really. understand what may be coming down the road, the externalities that can change your business model. >> i hear you on that front, the idea of an uncertainty tax. but i also wonder what it would be like, what you would be hearing from ceos if this was a kamala harris presidency. i mean, we now look at the idea of the tax cuts being extended as kind of a given that that would not be the

case if you were dealing with a different presidency. >> absolutely. which is why, becky, you know, my first point was, i think the general business view is that the economy would be strong and that. >> we're going. >> into an. >> environment where. >> less regulations that are shackling what you can do, a government. that's going to. >> be more. >> efficient. >> hopefully getting costs under. >> control. opening up opportunities. to do m&a. >> transactions, taxes that will not be. proposed to be increased dramatically. >> but may. >> be reduced or stay the same, all extremely positive. and those. >> are the. trend lines. companies are generally investing. but there is that friction. and it's not surprising, right? >> if a company. >> reorganizes itself. and has to go ahead and change its operations, it's going to get rid of some people. it's going to change its business focus. that uncertainty makes you slow down decision making just a little bit. but i don't think it's going to change the direction of travel here. >> what do you do with the tariffs? again, it's kind of

guesswork at this point to what's going to come in and then clearly guesswork on what the retaliatory retaliatory situation would be from other companies, other countries. >> great question. and you can't respond to every single press release or order until it's final. and what, what every threat is going to be because we. >> don't know. >> but what you do. >> is you build in. >> more. >> resiliency to your supply chain so that if you have to move it or change direction. >> of product flow from one. country to another. >> that you're going. >> to be. >> able to do that. >> you're looking. >> at where you're siting plants based on where you think most likely the tariffs will be. remember the tariffs and the reciprocal tariffs that you may be looking at are. >> aimed at where. >> market inefficiencies. >> or market distortions are from other countries. so you know, where. >> like in china or even india. >> other countries where there's. >> great incentives. for their own domestic companies. >> that that's the most. >> likely place tariffs would be. >> so how. >> do you build supply chains to account for that and.

>> alter them. >> where you where you can. but frankly. >> a lot. >> of this decision making, becky, is long term, as you know. >> and so. >> you're not going to overreact to every little press release. >> sure, mark, earlier this morning we heard from a cnbc survey that was done in combination with survey monkey for small business owners. and they were concerned, two thirds of them almost concerned about inflation, worrying that it's not going away. what do you hear from the big business leaders you talk to? >> yeah, it's a great question again. but it's clearly there's a concern about inflation. whether it's the potential for tariffs. whether it's the increase as i said resiliency in supply chains. so you're no. >> longer for lowest. >> cost places, but. >> you're looking where. >> you can have parallel supply chains. that's an increasing cost. labor costs remain relatively high. so i do. >> think. >> there's a concern that it's not going up. inflation is staying. >> there for longer. and that. >> means that you have to have

more cash. >> on hand. and when you do a transaction, the cost. >> of. doing that. >> transaction may stay. higher in the short term. >> so i think. >> there's a general view that inflation may be, you know, is going to be at. >> least where it's at, if not. potentially higher. >> mark weinberg, mark, thanks a lot for your time. it's really good to see you. >> as always. thank you back. >> thanks. >> coming up, what two key court orders could mean for the future of the consumer financial protection bureau data and its operations. plus, we're going to talk to former federal reserve vice chair leo brainerd about inflation levels and the potential for future rate cuts. all that and more as squawk box rolls on. >> for the fourth consecutive year. interactive brokers. >> is one of the. fastest growing. >> prime brokers. >> and is now. >> number five in. preqin's ranking of top prime. >> brokers. interactive brokers serves. >> both organizations and. >> individual investors to get better. >> results. get a better

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dude, i really need a new phone. check out my new samsung galaxy s25 ultra. it's got galaxy ai. imagine this thing running on our superfast xfinity mobile network. and i also heard that it can do multiple things with a single command. —with google gemini. let me try it. add recipes with overripe bananas to my “dessert ideas” note. that's what you chose to ask it? i had other things planned. ask how to get up to one thousand dollars off the new samsung galaxy s25 ultra with xfinity mobile. i should say, the consumer financial protection bureau is data and operations continue to put the federal watchdog agency's future in doubt. and sharon epperson is at the table this morning. she joins us more on what the effect could be for consumers. so what does it mean? >> well, you know, it means that

the trump administration has effectively closed the consumer financial protection bureau by firing workers and halting the agency's work. now, republicans have long opposed the agency. it was created in 2011, in the aftermath of the financial crisis, and the cfpb was designed to be an independent agency receiving its funding from the federal reserve, not congress. trump has said he wants to eliminate the cfpb because of waste, fraud and abuse, although. no evidence of those allegations has been offered. the law that created the cfpb assigned it specific regulatory responsibilities, including supervising financial firms responding to consumer complaints about financial products and services, and enforcing consumer financial protection laws. in testimony last week, fed chairman jerome powell said there's no other regulator to make sure banks are following these laws, not deceiving consumers. yet uncertainty about the future of the cfpb has put agency rules in doubt, including actions to cap overdraft fees, limit credit

card late fees, bar medical debt from appearing on credit reports and overseeing payment apps. some efforts to dismantle the cfpb, though, are now on hold, at least for this time. a judge's order on friday blocked trump officials from terminating more employees, deleting data or transferring agency funds at least until march 3rd, when another hearing is scheduled. yet in another ruling on friday, a federal judge granted elon musk's department of government efficiency access to systems containing personal. information and data at the cfpb and two other federal agencies. musk publicly cheered this decision, and we're likely to see more lawsuits and court decisions that will ultimately determine the fate of the cfpb. andrew. >> if all of. >> this gets wrapped up, though, inside treasury or some other department, i don't know if it gets broken up or what happens. is it possible that the i mean, i think people inside the trump administration would say, to the extent there are good parts to

the cfpb, we're going to continue those things inside these other places. and so you shouldn't just look at the department's disappearance as somehow its disappearance. i'm just making that that's the argument they make. what do both the critics say. and what do folks on both sides say? >> well, i think the critics say that there's been just overstepping by the consumer financial protection bureau and that that some of these regulations that need to happen can continue to happen, whether that's through occ or other organizations there. but there are people who are saying that the work that the cfpb has done since its inception, the $21 billion that through enforcement and supervisory work, consumers have been able to get back from financial abuses. there's a system set up that allows that to happen that is cannot easily be replicated. >> this thing's toast. >> it is toast. the question is, are there are there component parts of it that you ultimately want to. >> keep. out of all the this might end the biggest bull's eye on its back, out. >> of all. >> the it has.

>> had from the beginning. >> yeah, from the beginning. >> outside of usa, right? >> even more. i would say elizabeth warren's, you know, pet project. that's all you need to know. >> it's all some people. >> need to know. >> well, the other question is, does it, you know, does it disappear under this administration somehow find a way back. >> yeah. >> or eight or however many years later. >> like what happens to all the data that they've collected, right. the things that they've done. i mean, that's the that's the big concern and the access that now those will have to that information. what will be done with that. all of those questions are, are ones that still remain to be seen. >> thank you. >> sure. >> coming up, secretary of state. >> marco rubio meeting. >> with russian officials in saudi arabia discussing a potential pathway to peace or what that looks like in the ukraine or in ukraine. really, really saved me. what would a cease fire in the three year conflict mean for energy prices? we'll get into that and more next. squawk box returns in just

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too cold just enough to keep production going. but you know, not too expensive for consumers either. joining us now, don goldman sachs co-head of global commodities research. we're going to talk energy, but we're also we were just. >> off camera. >> talking about gold. and i think it might be your favorite. why? i can't help myself with bryant gumbel once in a while. i have to do it. but it's your. favorite commodity. why? >> yeah. two reasons. >> the most important reason. >> is that. >> we think that central bank demand for. >> gold real structure. >> will remain higher. >> i ask again why? >> why? because i think that m central bank reserve managers. >> in mid 22 got. >> a wake. >> up. >> call when they. >> saw that. >> russia's central bank reserves. >> got frozen. >> and are. >> wondering. >> are treasuries. >> necessarily always risk free? and is there not a strong case. >> to diversify. >> and. increase the gold holdings which can which cannot. >> be taken away. and we think that. this trend is here to

stay. >> the second reason is gold is a great hedge. >> against tariff escalation, concerns about debt sustainability. >> and so both in. >> your base case you have a lot of. >> upside with. >> gold going to. >> $3,100 per troy. >> ounce. >> by year end. and then you do quite. >> well. >> to protect your portfolio in those risk cases. >> so the central. banks explain again. the sovereign debt. became less. >> or at least you. >> there was a little. >> bit. more risk. >> involved with sovereign debt. so to diversify they said we're. >> going to buy gold. >> that's that's purely why they're doing it. >> that's right. >> and 22. russia's central bank reserves. >> invested in. >> in the. >> dollar. >> euro and other currencies. >> western currencies were frozen. so they. >> became. >> you know. >> without any value. >> for those ems and. >> the bank reserve managers. that was a wake up call. >> and we have actually seen an increase, of five fold increase in em. >> central bank gold. >> purchases since. >> mid 22, which is really a watershed moment for em central bankers. >> and i ask you also off camera, what about why gold

rather than bitcoin. and you said, you know goldman sachs does not the your you don't cover bitcoin at all. >> or commodities research. our research team currently doesn't doesn't cover bitcoin. i think there is one fascinating similarity between. >> gold and bitcoin which is that supply. >> is very limited. >> it's very. >> difficult to get. >> a lot out of the. >> ground, actually a lot of similarities, but that's one of them. >> that's the most important one. >> there are. >> also some key differences. if you just look at the. >> historical risk. >> return profile and. >> what those. >> two assets could do to portfolios. >> gold has recently booked. >> solid returns, but. >> bitcoin returns. >> have been very strong. but on the flip side. >> volatility has. >> been incredibly high. >> and so. >> if you're looking. to for a safe haven. asset to. >> hedge your. >> portfolio against these. >> scenarios, we think. >> that. >> the lower. >> risk properties. >> of gold are. >> quite attractive. >> you're the co-head of. >> global commodities research. when you have. >> meetings with the other the other co-head i don't know who that is. >> and my great colleague.

>> your great colleague and all your minions that work for you. do you talk about ever covering crypto? >> it's definitely. >> you know. >> an ongoing. >> conversation within our team. >> when's it going to happen? >> to be discussed. to be discussed. all including with management. >> let's get back. we so we talk about energy. and us at. >> 71 is. >> almost perfect is it not. >> yeah. >> so. >> you know. >> in the short term. >> you could argue. >> that high uncertainty about. >> us policy. >> could increase oil. >> price volatility over. >> the. >> medium run. we actually argue that the new us administration is. >> very much. >> supportive of. >> our brand range. >> goal 70 to. >> 85. >> for. brand 65 to 80. >> in wti terms. >> both because as long as. >> the brand. >> is. >> sort of below 85, which is us retail gasoline prices below three and a half dollars per per gallon, it's not a major. issue politically. >> that's sort of the energy. >> affordability part of. >> the sweet spot. >> and then as. >> long as brant is. >> above 70 ish. t above mid

60s, you are above the. >> break even cost of most. us producers. you can continue to expand production. >> and that's the. >> us energy dominance. >> part of the of the sweet spot. of. >> oil. >> prices we forecast. yeah it's almost it's almost. >> just right. so we've had we. >> had one of. ss he' just sort of a he's not a colleague at your own firm. but you know who jeff currie is. and you followed. >> him along. he's a former manager. >> absolutely. >> yes. so he if we wanted to increase production here he says we couldn't. >> further 3 million. >> no way to get another 3 million. barrels a day out of the us. is that true? >> so we have seen. solid ongoing. >> growth in. us energy production. >> but we're seeing a shift away from crude indeed. but we're seeing pretty rapid growth in terms of natural gas liquids. >> and then on the. >> gas side, we are going to need. >> a. >> lot more extra us natural. >> gas. production to meet all that extra lng demand as we're going to continue. >> to add lng export terminals. so overall, us energy

production. >> will continue to grow at a solid pace. >> but indeed. >> we expect. >> an ongoing slowing. >> in us lower 48 crude. >> but drill baby drill will not bring about $40 oil. >> that's what i was worried about. if we. >> really the spigots are open. >> already, are they not? >> yes, we. >> we think that the most important. driver ultimately of us oil production is. prices at the margin. if you remove some of the. >> regulatory barriers that could. >> support medium run production growth somewhat. >> but the key. >> driver of us oil production is very much prices and capital discipline. >> from shareholders. >> russian oil is off. the markets. >> are on the markets. >> it's been on the entire time has it not? will there be any change from from a peaceful. >> we would. >> not expect. >> a change in russian crude. volumes if. >> sanctions were to ease in the. >> context of a peace deal. >> why? >> because the main reason that russian crude production is. constrained is. >> a self-imposed constraint, which, in. >> the context. >> of opec. >> plus coordination. >> between riyadh. and moscow. >> very. >> different from natural.

>> gas markets, where volumes are. >> down 88%. >> from russia to europe. >> and iran. what what can we expect? i mean, it's we have no idea what's going to and there are some. >> people, you know, you saw the article last week that. israel is may or may not. >> do something. >> this year with i don't know what that would do to, to. >> oil. >> but what. >> if what if something with the nuclear facilities. >> happened with israel? >> yeah. so base. >> case iranian. >> crude oil production declined somewhat around three 5400 kbd in the context of a return. maximum pressure under the new us administration. but i think the risks are skewed towards significantly lower iranian crude production. >> and that. >> could cause a lot of short term. >> upside to oil prices. for instance. >> if both iran and russia crude production were to fall by a million barrels per day in the. >> context of tighter. >> sanctions enforcement, you know, t could could go to the high. 80s in in our framework, at least in the short term. until the us and saudi arabia. >> likely respond. >> by raising more production.

>> all right. >> do you ever worry about. >> bird flu? we're not going to have. >> another pandemic, are we? can you believe oil went negative at one point? >> pretty unbelievable. >> you always. >> want. >> to you know think about the tail. >> risk to your forecast. so for sure. something to think about. >> i guess if another pandemic is coming oil price i'd be. >> like not my first worry. >> oil prices. >> i might. >> be okay. >> with putting that on the back burner. >> comorbidities i might be more concerned with. don. >> thanks. >> don golden. >> co-head co-head. does that work? you know co-counsel is that never work co co-ceos never work. >> i feel. >> blessed with the partnership. >> you do all right. it's nice. >> all right. it is 8 a.m. on the east coast. and you're watching squawk box right here on cnbc. i'm becky quick along with joe kernan and andrew ross sorkin. and among today's top stories, russian media reports say that the us russia meeting in saudi arabia has concluded

about 4.5 hours after they began. they characterized those meetings as positive and, say, conditions for a meeting between president trump and putin were discussed. although no date was set, the dodge team has published a website detailing the savings it says it has made so far, totaling $55 billion, it ranks the biggest cuts as coming from usaid, the department of education, the office of personnel management as well. and it posted a wall of receipts detailing those cuts that it has made. and broadcom and taiwan semi are reportedly considering deals that would split intel in two. the wall street journal says that broadcom has looked at intel's design and marketing business, while taiwan semi is exploring control of some or all of intel's chip factories. intel shares up by about 5% on those reports right now. >> meantime, take a look at the futures. we do have some green on the screen about 58 points higher on the dow right about

now. s&p 500 up about 20 points. you're looking at the nasdaq up about 93 points i want to get down to the new york stock exchange where our good friend mike santoli joins us. what are you looking at this morning. >> well andrew that little one third of 1% upside indicated in the s&p. 500 is going to be enough. >> to get. >> us. to a. >> new record high. >> we close. >> just on the doorstep of a closing high. >> on friday. >> it's been this. >> sort. of quiet. >> churn, mostly. sideways with a slight upside bias. >> for a. >> few. months here. >> we basically. >> touched 6100. >> on the s&p on. >> an intraday. >> basis on. >> december 6th. >> and you. >> can kind of. >> see this was, you. >> know. >> maybe the. >> the ceiling. >> for a little while. we've visited. >> a few times. low momentum. >> it's not. >> like a. >> broadly inclusive. >> high energy move higher. >> but no. >> news has been good news when it's come. to things like tariff news. and it. seems like. >> we're in for. >> at this. >> point anyway. >> a little bit of a. quiet session. >> and maybe. >> even week. not that much macro data, so we'll see if the market can make any hay with that. >> take a look. >> though. >> at maybe. >> a. >> little bit.

>> of a. >> surprising kind of. >> turnabout, which. >> is. >> non us. stocks on a year to date. >> basis really flying. >> relative to the. >> s&p 500. >> a few. >> things going. >> on here. >> one massive. >> deficit in terms. >> of overseas. markets relative. >> to the us. >> markets over a year. i mean, even on a one. year basis the s&p. >> 500 is leading. >> this is. >> all countries besides. >> the us. >> by like. >> 12 percentage points. so partly it's a mean reversion. >> catch up move. partly it's a matter. >> of where might the economies kind. >> of have. >> low expectations. >> and the potential to surprise to the upside and accelerate. that seems like it's more. >> outside the country. china and europe both been very. >> strong performers. >> in this context. >> we'll see if there's more. >> to it than. >> just kind of a reflex move. now take. >> a look here. you guys just talking. >> about the commodities. >> they've actually. >> kind of built this. >> little bit of a base. this is the goldman sachs. >> commodity index there. >> and against the us. >> dollar index. >> obviously you. see more or. >> less an. >> inverse kind of movement. here between the two. >> and you know, we got some relatively reassuring inflation news. >> and what you're. >> not going maximum immediate

tariffs. it means the dollar can cool off. so that's been pretty decent. >> for commodities. >> and of course if the rest. >> of the. >> world is going to. >> start to grow again in terms of demand, it can. lead to a kind of a. >> firm setup. >> for the commodity complex guys. okay. mr. santoli, thank you for that analysis and we'll be seeing you a lot more throughout the day. >> and coming coming up. >> there back to you. they had me for a second. now i don't know. >> coming up we're going to talk. >> about president trump's legislative agenda. >> and getting. >> a budget deal. >> over the finish line. >> tennessee republican senator bill hagerty is going. >> to join us next. >> and then in the next half hour, palantir co-founder and ceo alex karp. joins us with his warning for silicon valley and the west about threats both here and abroad. squawk box returns. >> in just. >> a moment.

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>> i don't. >> shed as much. i'm a jolie addict. >> in the house and senate have submitted dueling budget proposals. joining us now to talk about the plans and president trump's legislative agenda, tennessee republican

senator bill hagerty. and once again, the we our hearts go out to a lot of the people in your home state, senator, with with the flooding that we've seen and hopefully that hopefully. the help is either there or forthcoming. >> yeah, certainly. i appreciate that very much. as to the people of tennessee, the rains were significant. the flooding, as you seen on, you know, much of the coverage. >> has been devastating. >> we're working very hard to make certain people getting the aid they need. >> okay. >> so we're. here to talk about. >> actual legislation is that it's so out of vogue now. do we really need it? >> and can't. >> we do. everything through executive order? now, senator. >> we need to. where are. >> we on that? >> this is actually one of those areas, joe, where legislation is going to be required there. >> as you say, there's been. >> a lot that's been done by executive order. but in this case, we're working very closely

again with the house and the senate together. and we'll work closely with the white house as well. >> we're coming. >> up into a point where the american public really expects us to deliver. it's about energy independence. it's about our national defense. it's about bringing inflation down. all of this. >> has to be addressed also in the. >> context of the broader tax cuts. >> the president. >> trump wants to see in place, because that will have long term positive implications for the economy. so it's a complex process. the house is working at pace on. its product. we're moving forward in the senate, and i'm certain the white house is going to. step in. we're going to have to bring all of this together pretty soon. >> i wonder how that works, so that there will be a third person so that the white house will be involved. does the senate talk? >> do you the people running. >> things in the senate, are they trying to coordinate with with the speaker and vice versa? it doesn't. >> look like. certainly i think the conversations are on a regular basis between leader. thune and also budget chair graham, as well as with our majority. >> leader in the. >> house, mike johnson. i think

they're working very closely. mike johnson obviously has a higher hurdle. >> he's got a very. >> narrow margin to navigate with. they put a product together right now, a larger product. senator graham, the budget committee, he put something together that would be a little bit slimmer if that makes sense. really focused just on energy independence, national defense and the coast guard. but what we're trying to do is keep things moving forward and make certain that we've got options as we come into the spring here. but what i want to do, and i'm setting process aside, not too hung up on whether it's one bill, two bill or three bills. i think president trump feels the same way. we just need to deliver on what the american. public has asked us to do, and that is to step up, bring inflation under control, get energy. >> independence back. >> on the forefront and get our southern border corrected and fixed once and for all. >> when it's all said and done. senator, the extension of the tax cuts, will it be permanent. and can you do that and all the other you know, no tax on tips, no tax on social security that

we're talking trillions of dollars. but there are some senators saying if it's not permanent, we had one on last week. if it's not permanent, i don't want a ten year extension. i want. >> a. >> permanent the federal government. that's a great question. and i think we would all like to see it permanent. and here's the reason. >> we need. >> to see consistency, certainty. as you know, the business community certainly appreciates that much more than the volatility that's associated with these short term extensions. it really gets down to the math and how we go about the process of paying for all the various features that are going to go into this. so it's a product of negotiation. i would certainly like to see it permanent. but again, we've got to get down to the hard part of putting the math together. >> and. >> as far as deficit busting. >> implications of what we're doing. >> in your mind, do you think that doge can. somehow play a. >> very significant. role in. >> cutting enough to allow for

some of these things to happen? i mean, it's just hard to see it adding up. we get i mean, on the big. >> frame of things, 3 billion sounds great. >> when doge finds $3 billion, that's like. >> a. >> you know, that's. >> like a drop. >> in the ocean. >> for what we're. >> dealing with here at this point. >> just that the. >> white. >> house team. >> says, quote, i think the critical aspect of it here is that doge has been underway for, what, three weeks? we've got to start moving in the right direction. we're looking at a situation now where we've got a $37 trillion budget deficit that is so significant, and we've got to begin moving again in the right direction to become more fiscally responsible. i think what doge is uncovering is the fact that there's a considerable amount of waste, fraud and abuse that's in the system. if we go about the process of systematically uncovering that, two things will happen. one is that there'll be immediate opportunities that doge will uncover, that they can address. the other, more significant component is that they're going to be signaling. >> back. >> to the. legislative branch that we've got major areas that we can come in reform, modify and cut. but the whole streamlining process ought to

have, in the long run, not only the impact of reducing the deficit spending, but also increasing our efficiency as a nation. both of those things combined, i think, will have very positive implications for our deficit, for our fiscal situation in the long run. and i think it's something that we've absolutely got to get started on. i think the american public are ready for it. >> who do you credit with. >> getting these. nominations through? even some of the ones. >> that that didn't. >> look like. >> it was going to. >> be easy, or it looked like it was going to be more difficult? >> is that is that the leader or is that senator. >> thune? >> is it what. >> i'm getting at. >> is or. >> does trump really, president trump really hold sway. >> over both. >> the senate and. >> the house? and will that mean that we. >> don't have problems. >> in the house for mike johnson this time around? or and the senate. >> i think. joe. yeah, joe, the answer is yes to both in terms of president trump's influence. look, the american public spoke loud and clear. we're we're cognizant of that here in the in the senate. the point is president trump is entitled to

his team. he's put together a an incredible team. they're very disruptive. i think what we want to see with the american public wants to see is real change. and you've got people coming into office to do that. but i don't want to emphasize the fact that that leader thune has done a tremendous job. he's kept us on track. he's pushed back against maximum resistance that we're experiencing from the democrat party. and he's kept us moving, i think, at. >> a pace. >> that everybody has been extremely pleased with. and so president trump is achieving what he promised, what he hopes to accomplish in terms of getting leadership positions filled. and you've got leader thune that is doing a terrific job of making certain that we're here, whether it's through the weekends, through the evenings, late at night. he's kept us here, but he's keeping us at pace. so i think both deserve a great deal of credit for making sure that we're moving in the right direction here on these nominees. >> senator, we have. seen a. lot of. >> consternation from democrats about. >> some of the things that. that president trump has done. >> you know, we're. >> with the department of justice, maybe the. mayor adams

case and. >> i mean. >> if you listen to. to democrats in certain areas, it's a constitutional crisis. i've heard that over and over and over again, even some conservatives. yeah, even some conservatives, though, have pointed to certain things where they perhaps think that. president trump is. >> is pushing it. >> a little bit too far. has there been anything. >> that you've seen where you were hoping you don't get any questions from on. >> tv or from constituents about anything where you're like, wow, that that's even something i wouldn't have. tried to do. >> well, i think what we're what we're seeing in hearing, joe, is just just the fact that the democrat party is coming unraveled. and i think, frankly. >> a lot of their. >> allies in the media are as well, because i've heard the term constitutional crisis over and over and over again. and now that we're presiding in the. united states senate, because the republicans have taken the majority, i've had the benefit of sitting there on the senate floor listening to time and again, my democrat colleagues

coming and saying that if, for example, russ vote, who is now our omb director, were he to be, you know, confirmed as omb director, millions of people would die that we're in a constitutional crisis. this isn't happening. there are not people piling up dead on the streets. and this crying wolf constantly, i think, just discredits the democrat party. they need to figure out where their core is. they need to get to. they need to get back to, to the basics and join us in governing rather than just these shrill cries. again, because i think people are just becoming numb to it. >> do you think. >> is it. >> the perception that. >> that maybe. >> the president. >> wants a deal with ukraine. >> so bad and russia so badly that we're that that ukraine will not. get a total fair shake, that. >> that putin is going to. >> have the last laugh. do you see that? you hear that. >> coming from. >> obviously from. >> certain circles as well. >> you've heard a lot of speculation about what's taking place. one thing i want to be careful to do, joe, is not get ahead of the negotiating team. last night in riyadh, they

agreed to put a high level team together to focus on bringing this to resolution. i think what we all want to see is an end to the death, to the carnage. what's happened in ukraine has been absolutely awful. i think we'd all like to see that come to an end. president trump has clearly been focused on that. i'll let that team get to the point of negotiating the details, and the last thing i'm going to do is try to get ahead of them and start speculating right now. but i think one thing is clear the american public wants to see this come to an end. i think the world needs to see this come to an end as well, and i'm hopeful that that's going to happen posthaste. >> all right, senator. >> so you're. >> a pretty red state. you haven't been you haven't been hearing a lot of complaints yet. you're all right. you're good. you look. you look. >> like you're not worried that that that. >> andrew, you want to weigh in on anything? >> nothing. >> you know. >> you you've asked questions. i tried to. >> and we need to pace ourselves. i think everybody needs. it's going to be another 1400 days. >> that's my only. >> concern, senator. >> it's another. i want everyone to take a breath occasionally. or do we need to just. >> you know, i've seen certain

people say we need to rally the troops right now and start. screaming because. or else. >> we're going to. >> lose our democracy forever. >> so democrats can't figure out how to respond. >> yeah it is. >> yeah. >> well, i hope we can stay in touch because there's so much more to come. president trump is going to tackle tariffs. the lack of reciprocity that we've had with our trading partners. around the world. as you know, i was u.s. ambassador to japan. >> when we were. >> together with japan. >> i think i've drawn. >> him in. jo jo. >> jo drew me in in the following way. senator, i'm going to ask you to ask it this way. okay? all right. obviously, the administration is moving super fast, and by the way, may need to move super fast to get stuff done, just not only in terms of its promise to, to, to the to its voters or to the voters, i should say. but more importantly, because if you don't do it quickly, you may not have the chance to do it later. but my question is, how important is it to bring the entire country along? how important is it to do it with sort of a level of transparency

where people don't not question the merits of certain decisions themselves, but whether what's being done is being done transparently and honestly. right? i mean, i think that is a central question. yeah. >> well, in terms of bringing the country along, i go back to election day, where 75% of the american public said that we were on the wrong track. they want to see change. i think that opens the opportunity for us. and if you look at what's happening right now, president trump is holding daily press conferences. that's transparency that we've not seen in the past four years. and i think that's refreshing to the american people, as you say, they may or may not agree with a particular policy point. but what we've seen is transparency at a level that we have not. >> senator, no, the point i'm making is what we're seeing is, you know, is we're seeing resignations and maybe that's the goal, but we're seeing resignations from people in senior posts, some, by the way, who are conservatives. i'm thinking now of the justice department who are saying this is this is just inappropriate, what's happening. and some of them may be doing it because

they're trying to save themselves in some other way, or save their jobs, or save maybe people from seeing certain things. if that's the case, i don't think you want them in those roles. but there's other people, i think, who have had some merit to what they have suggested is going on here and, and seem to have great anxiety about the way it's being approached, maybe not what's being done, but the way it's being done. well. >> this is disruption. look, i'm from from a corporate background. when you've got a situation like we're facing right now with amounts of debt and deficit spending that we're dealing with, you've got to come in and deal with it in a very rapid pace. some people are uncomfortable with that. i get it. they can find another place to work. i also lived in the first administration. i served in president trump's first administration. there were a number of people that resigned for high sounding reasons, but i think it really was having to do with their own career and where they hope to land next. so i think we should just let this move forward again. it's early in the process. there's going to be disruption. >> there's going. >> to be change. but i think overall, we're moving the direction that the american

public wants to see us move. >> okay. senator, it was i think. >> we all. >> got something out of having you on today. hopefully we have. >> you on again soon. >> i appreciate your time. look forward to it. thank you all. >> all the best. >> coming up we will talk about the economy and the fed with lael brainard. she served as economic advisor to president biden. and she is a former fed vice chair, then frontier ceo alex karp joins us on set with a warning about emerging global threats. squawk box will be right back. >> i can see why. >> you're expanding. >> its nuts online to. >> what's the secret? >> we know humans like new toys. >> so always. >> staying one. >> step ahead. >> and with. >> ai we. >> can. >> look. at so. >> much more than sales data. >> by our behaviors. >> social engagement. >> see that? >> predictive analytics. >> how long have you. >> been doing this? >> as long as we've been with. >> people who know.

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welcome back to squawk box everybody. let's get to the economy this morning. higher inflation readings and tariff uncertainty. have the markets on high alert. over the weekend, two fed officials said that they would like to see inflation move closer to the target before cutting rates again. joining us right now is former fed vice chair lael brainard. she served most recently as national economic council director under president biden. lael, thank you very much for being here this morning. let's talk about that inflation front and center. how concerned are you about these higher ratings that we've gotten? well, look, i. >> think the producer price data gave us a little bit of reassurance after the hotter than expected consumer price data. and so the gauge that the federal reserve looks at the pce gauge, which will come in later

this month, will probably come in a little closer to two and a half core pce, two and a half 2.6, which will be a little bit closer to where the federal reserve wants to get. nonetheless, i see the federal reserve on hold. i think they are in wait and see mood, given that there's so much policy uncertainty, particularly about tariffs and about immigration. >> i mean, i think the fed's on hold. whether you think about any potential policies down the road anyway. inflation is hotter than they thought. we've now gotten three months in a row where that reading has been hotter than anticipated. it's trending the wrong direction. and even if it comes in at two and a half or 2.6%, that's not 2%. it's hard to look at this, particularly with the pretty decent jobs market that we have right now, and think that the fed is going to be in a position to cut rates further, right. >> i think. >> that. >> is certainly what the market is anticipating. they really don't see a cut until at the

earliest late in the year. and as you said, we had been on a disinflationary trend. and the last few prints have come in on the hotter side. we'll have to see what happens in the months ahead. >> what what do you think about when we look at these cpi and ppi numbers? i mean it's concerning because that last mile is always the toughest to break when it gets to inflation. and this is just been persistent. it's been sticky. it's been concerning. we did get a survey that we had cnbc and surveymonkey this morning that showed that almost two thirds of small business owners are pretty concerned about inflation rising up again at this point. do you feel better about it than that? well, we certainly. >> saw that in the michigan consumer sentiment numbers as well. i think people are worried now. certain prices are going up and have gone up by a lot like egg prices. and those are things

that consumers buy every week. and so it does bring a lot of stress on middle class families. so yes, there are prices that are certainly affecting those pocketbooks. again, and i do think policy uncertainty does also bring some doubt to federal reserve policymakers. if you do see the kind of tariffs that we are hearing about from the white house and the kind of mass deportations that we're hearing about, those would lead to higher prices in areas that matter a lot for consumers. >> as a former vice chair at the fed, the idea of policy changes is always a tricky one, trying to figure out what might happen and how to anticipate that is your best hope at the fed, to just kind of be on hold and wait for the data to come in. so the reading. >> i see from, for instance, the chair's comments and other members comments is that they

don't want to get out ahead of policy. there's a lot of news every day about potential changes to policy. and so yeah, i think it adds to that wait and see posture because you you shouldn't go and make changes to interest rates based on policies that haven't yet been enacted. >> we were having a conversation earlier this morning. and while the markets may worry about what the fed's going to do, in some cases, it's the markets themselves that that have to be the ones that you you worry about that you have contentions with. when you look at treasuries right now, it's not what the fed is doing that has driven the long into the market. it's bond vigilantes. it's worried worries about what kind of spending we're going to continue to see and what kind of deficits we'll see to. well. >> that's absolutely right. the kinds of tax cut plans that the white house is going forward with just extending the existing

tax cuts, including for the richest 1% of americans, that's $4.4 trillion of tax cuts. so that's a lot more bond issuance. now they've got on the reconciliation legislation on the house side. they've got some spending cuts. but how realistic are those spending cuts? you know, you've got about $1.1 trillion in cuts just in order to pay for tax cuts for the top 1% of americans, offset by spending cuts that come entirely potentially on medicaid, food aid. that's really going to hurt working families, not good for the economy. and of course, those tax cuts are simply an extension of existing. so they don't add additional impetus to growth. >> those were across the board tax cuts that did help the middle class. >> and when. >> you say 1%, are you talking about corporations too? do you think it was. >> i mean. >> do you think that's a tax cut for the wealthy. >> when you bring.

>> the corporate tax rate? no, a lot of what you were saying. just sounded to me like it just it just sounded like democrat talking points that that's all those tax cuts were. there's no doubt that it was. >> i mean. >> when you talk to republican about it, the greatest thing that's ever happened, do you say. >> at this. >> point it was a tax cut just for the wealthy 1%. >> that did? no one else. >> benefited from the tax cuts from 2017. that wasn't a net positive for, for growth and for the us economy. is that what you're saying? >> no. >> absolutely not. >> these are simply the fiscal estimates of how much additional revenue losses going forward will be necessary in order to finance tax cuts. so it's really if you look at the $4.5 trillion of revenue losses over the next ten years, of that, over 1 trillion is necessary to extend the tax cuts for individuals over over in the top 1% of

income. so, of course, in order to pay for that, there have been some suggested areas of cuts. one of the biggest areas, $1.1 trillion of cuts would be on medicaid and food aid. and of course, we know those will go to families that are more cash constrained. and so that could be a real drag on the economy. i'm, i'm talking about going forward, where do you get the money to pay for those tax cuts on individuals? and it's the 1.1 trillion that is needed for extending tax cuts just for the richest 1%. so it's really just a question of how do you pay for it. and that's really getting back to the conversation of our interest rates on the long end going to be coming down. if the us needs to do that amount of borrowing going forward. >> lael brainard, thank you for joining us this morning.

>> thank you. >> coming up, palantir ceo alex karp is going to join us at the table to talk about his book, all things ai and so much more. we're going to do that next. and as we head to a break, take a quick look at futures this morning. some green on the screen on this tuesday on a shortened holiday week here 63 points higher on the dow. nasdaq looking to power higher by 107 points higher. we're back up to this. this. >> close. this is steve. steve takes voquezna. this is steve's stomach, where voquezna can kick some acid, heal erosive esophagitis, also known as erosive gerd, and relieve related heartburn. voquezna is the first and only fda-approved treatment of its kind. 93% of adults were healed by 2 months.

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>> join the club. >> one of the key benefits. >> for me is. >> knowing where jim is. >> going to buy or sell before he doesn't. >> join the club. new members save with a special offer for a limited time at cnbc.com. terms and restrictions apply. >> we know he wants to hold on. >> to the nba. how much more will. >> he have to pay? >> a lot of the revenue streams are guaranteed. >> cnbc sports official nba team valuations available now at cnbc.com. >> welcome back to squawk box. this morning our next guest is sounding the alarm that silicon valley and the west have lost their way. joining us right now is alex karp palantir ceo and co-founder. his first book is out this morning, the technological republic hard

power, soft belief and the future of the west. we want to thank you for joining us. >> it's kind of risque. >> it's a little risque. >> i think the title, it's like it's hard to know if it's a it's like an off color movie. hard power. soft. >> but i like that. wow. >> he goes there early. yeah, it's hard to know. it's hard to know. >> i have about a million questions about the book. but before we get there, i just want to ask you a couple of things about the news, because interestingly, i would say the book which you wrote a year ago, in a way, you were predicting where we would be today in terms of some of the big issues. >> the you know, the interesting thing, basically what people. >> say, it's not. >> actually a the standard book is. >> comes in two forms. >> either promote yourself. it should be karp a.i, karp ai, or it's. >> somebody running for president. >> i'm doing neither. and so the book really is an attempt to say, look, everything. you learned at your school. >> in college. >> about how the world works is. >> intellectually incorrect. >> and here is. >> a way of seeing the. >> world that may not be right.

>> but it's not wrong. >> and so. >> trying to be. >> right is. very hard. >> but you can definitely know what's wrong. >> and what what you've. >> been taught in college. >> that you basically should have no beliefs that the west is inferior, that the intellectual tradition of. >> the. >> west it leads to self-flagellation. >> and losing. >> on the battlefield, losing. >> intellectually. losing your party. losing your. >> country, losing your border, that. >> your institutions can't work. >> because we're. >> so good. it's actually wrong. and the west was actually never about that. and you can be good, decent. and win and be intellectually correct. and what was absolutely. >> spot on about the. >> what's in the book is we have this. >> technological revolution. >> it's no longer fake. >> two, four, three, four years. >> ago, institutions basically thought i'd rather have a good steak dinner and a bad product. >> and at. >> least i. >> get the steak dinner. >> because the software product. >> doesn't work. >> now we are in a software. >> defined world. >> and the nation. >> that leads software is the usa. and then. >> so that. what does that. mean for. >> all institutions? what it means that institutions.

>> have to. >> actually live up. to their core, their core mandate. >> so a country. >> has to have a border. >> the educational institutions. >> have to work. the military actually has to be scary. you actually. >> can have things. >> function in a way where the outputs are much greater than the inputs. and people who ignore this are going to be washed away. >> why did you write this? were you mad at the educational system? did you think that they were teaching the wrong things? i think. >> look, i think the west as a notion and as a principle upon. >> which. >> it is. executed again, is obviously superior and not acknowledging that, because by not acknowledging. >> it or denying. >> it, you could pretend. you were smarter or. >> better than you were. >> has led. to enormous problems. >> in. >> our society. >> and also. >> for the sake of humanity. >> we have been. blessed with a resource called. talent management and software production that no other country

has. so what does that mean. >> for us? what does it mean. >> for the world? how do you manage that ethically? how do you and how do you prevent what we had? essentially, we had a pagan religion that is infiltrated our universities. >> and then. pagan religion. >> basically says everything. >> that's good about. >> america. >> everything that actually works is ipso facto bad. and by the way, you can't talk about it not working because it's a religion. so what it's not even and it's a new religion. >> it's not. >> an old great religion. judaism, christianity, islam, it's. >> a. >> new religion. and the tenets are west is bad. >> n can work. >> if it works, it's bad, and the west is. and that way. >> of thinking. >> has corroded every aspect of our site. last but not least, it leads to a situation where you get a complete. corrosion of all institutions and to a legitimacy crisis. so no one actually believes. anyone's an expert. >> i'll just make this last point. >> in the 50s, if there was this

famous professor ken arrow. >> and if ken. >> arrow said you were smart, you got tenure. and why did that happen? is because people knew. ken arrow is smart. the institution he represents is the best in the world. there is no one. honestly, the only thing like that currently in. tech is a palantir degree. if you work for palantir, everyone knows you're good. >> and that's. basically none. >> of these. like when we went to school, the schools actually. >> had credibility. >> the people, the science was actually science. you could. >> and then i want to actually get into some of the news. but what would you do to bring it back? and do you think we're on that path now? >> well. >> i think actually. so one. >> of the things that's not in the book. >> i think. if you read the book, it reads like it was. >> written today. >> but so i'll just one of the things i that, that i would if i were writing the book today, there's a sense that people have that there's a pendulum swing. so if you like, like if you look at institutions. >> that are failing. >> and you talk to. >> the smart. >> people, their universities,

un. democratic party, they'll tell you there's going to be a pendulum swing back. but ai is actually breaking. >> the pendulum. >> spring swung. so what europe thinks of like, i spend half my. >> life. >> in germany. you talk to. smart germans, they're like. >> okay. >> we're. >> having a bad time. we're going to have a good time. >> we did this under schroeder. >> it'll come back. >> we don't actually agree with all the stuff that people say. we can't say it publicly. that's what they say, okay? >> but what they're not understanding is the. technical revolution now is so great. >> you got to get on the train because that. train is leaving and it will. >> there is. >> not going to be a swing back. so what i'm trying to say to people who are on the pendulum, people who are builders, is like, we have a responsibility. we have to be dedicated. >> to our nation. >> what i'm saying to people who. may have. >> think they. >> can get off. >> the train. >> university intellectuals, united. nations dedicated to. >> undermining america and anyone who's jewish or something. you're being left behind. and by the way, i'm happy you're being left behind. >> but just know, if you. >> get left behind. do not.

>> cry that you're not part of the dialog. and that's actually what's happening. >> they're like crying. >> crying like. all these. >> people are becoming protest parties. >> it's like i grew up protesting in dc with my parents and no one listened. if you want to go back to that, just do not read the book. pretend this isn't happening. alex, how did so. many whoever's hiring in colleges, how did. it was just sort of a mass hysteria to all be on the same page for who gets tenure and what dogma and orthodoxy makes you attractive to, because it's everywhere. i don't understand how it happened, and i don't i don't think we ever get it back. >> well. >> i understand how it happens. it's like the basic. >> this country is fundamentally calvinist. >> so that and that's. >> one of the great strengths of this country and what. >> calvinism basically says. >> as. opposed to like lutheranism and. >> other is if. >> you've done something. big and. >> important, you've probably a good person. >> and what you. >> had at universities was. >> an inversion. >> and rejection of that. and so. >> all the intellectual movements are downstream from

that. >> and so the. >> the and that inversion. >> is very, very charismatic. if you want to assume that you are right because you're you're wrong, basically. >> and it's a very, very charismatic movement. >> but i think. >> the. >> area where we. >> bear responsibility. >> to disagree with it is we have to. >> stand up and say. >> but this doesn't work. we have to we have to. >> you know, one of the. >> things in the book that's unusual is. i'm quoting like. >> judge them by the fruits they bear. >> like we have. >> okay. you're in favor of this world order. what have you built that works? what? just like, show me any institution that you've created. any institution. and. and i want to see that institution. >> where the inputs. >> are less than the outputs. okay? and i don't care what. >> it is. it could be an intellectual project. >> it can be a road. it can be a skyscraper, it can be a weapon system. >> and what. >> what you will. find is they will they'll they'll literally say, i reject that frame. and that's okay. but it's our responsibility to hold them to

account. you rejected the frame of something that. could work. >> i'm not. saying that. everything i'm. saying is right. i don't. >> know that. but i. >> am sure certain that what you're saying does. >> not work and you will be. >> left behind in history. alex, let me ask you a couple of things that are in the news, and i just want to actually relate one of them to something. you just said. you lived in germany for half your life. yeah. and there is a big debate going on about the politics in germany right now. you're also jewish and there is support and you've even seen it over the weekend. marco rubio and elon musk and others have been very supportive of the alt right movement in germany. while there have been questions about their association with some supporting nazis and other things, i'm curious where you land on that. >> well, just i don't want to go into the technical weeds here, but the real the problem. >> in germany. >> is that. somehow the small. >> portion of germans. >> that believe. >> you cannot talk about migration without.

>> being a bigot, which is about probably 15%. 90% of. >> them vote for. >> the green parties have somehow. tricked the larger. >> parties into saying. >> they will only vote. >> for things if the far. >> right doesn't vote with them, which basically, as a matter of pragmatic. >> power. >> shifts all immigration policy to a small group of people that literally will. not let you discuss the fact that. afghani immigrants to germany. have a. >> 70 x. >> 70 x propensity compared to german. >> population to. commit certain kinds of. >> crimes, and. that in the last couple of weeks, every. >> single terror. >> attack. >> every single terror. >> attack has been the result. if you go to jail. for pointing that out, you'll get into trouble. but this is the weird thing that again, this is the there's a lesson in this book which is do not allow yourself to become a product of people you. >> may tacitly. >> agree with. so like. >> i'm. >> sympathetic with. >> nondiscrimination. >> i don't believe in

discrimination across any variable, but you are. >> being turned. >> into a product by a certain. small sector of the. left because you're. not allowed to talk about facts like in the last couple of weeks, every week there's a you know, what happens in germany is there's a terror attack in. >> the. >> morning and the greens and the left protest the far right. >> in the afternoon. >> this literally what's happening. and the average german, i know so many germans who would never even use the term alternative for deutschland. four weeks ago they were telling me like, yeah, screw it, i'm going to vote for them. and the reason why is it's our responsibility. and you. >> see this, by the. >> way, why is the democratic. >> party committing suicide? it's because in the us you're talking in. >> the us, it's the same thing. it's like we're not allowed to admit we're not allowed to do true false. like, okay, i agree with this person. >> i don't agree with this person. >> we literally have to say. >> anything that's. >> ever been. >> uttered from this person in. >> the whole. timeline has to be wrong. >> including border defense. and this is this is happening in

every western country. and again, it's a very similar to the. >> question you asked. >> okay, we know why they do it. the greens and others are really smart to do this because then in. >> the end. they define how. >> the society. >> is run. but none of us want. >> that society. and it's not bigoted to say, wait a minute, this is not working. and then you have. following issues. it's like then by the way, then on the outside, what i tell. >> my german friends and in private is, okay. >> you. >> don't like what people are saying, but if you're not taking your immigration policy seriously. >> you have no. texting that germany had the. >> most important texting in. >> the world pre-war, bar none. like in america, it has de facto almost no. >> tech scene. it's nascent. >> no one believes in it. no one's investing. in it. the energy policies. >> make no sense. >> and then you wonder why people don't take you seriously. you got. >> in in this. >> book. it's basically like, fix your. >> thing at. >> home or no one's taking you seriously. >> and then when people. >> don't take you seriously, you get mad. honestly, though, i'll tell you what, i. >> shouldn't even say this.

>> but what i tell europeans in. >> private is, you know how when you go. >> to the. >> inner city in america. >> and the mayor is talking. >> about safety and you're like, get me out of this country? i tell them this in german. that's what we're thinking about. you're texting. no one's. anyone seriously is telling you. >> this is. >> a joke. let me ask you one question. >> and by the way, like. >> yeah, i want to ask you about ukraine, but let me just ask you one german question, which is but how do you feel about some of the folks that are part of that far right party, and how do you how do you deal with. but again. >> let me just tell you what. let me take. >> a trick from the old thing. let's if you focus on. >> all some of those people i obviously don't like and probably. >> don't. >> like me and there is. >> there any semitism. >> on the right? yes. but the. structure actually. >> anti-semitism in an immigrant population that. >> is like like that is the biggest. issue in europe. but by the way, the point i'm. >> trying to. >> teach people. >> is focus. >> on what you believe. i don't really want to talk like, yes, there are people who will vote for me i don't like and they don't like me. >> it's like. >> in on every. >> issue, like there are people who agree with. >> me on israel and don't.

>> i don't agree with on first and. >> second amendment. >> it's like you. >> have to. >> focus on what do i believe? >> and you know, what? they're going to be people. some people come with. >> me. i don't. >> like and don't like me. that's okay. speak to this because we've been talking about ukraine all morning, and you've been very involved in that, in that battle. i want to show you this real quick, if i could, and i don't know if we even have time. secretary of state marco rubio was just speaking literally moments ago. and after a 4.5 hour meeting with russian officials in saudi arabia to reset relations with moscow. and i want to get your thoughts on it, if we could. >> the goal of today's meeting was to follow up on the phone call the president had a week ago and begin to establish those lines of communication. >> the work. >> remains today as the first step of a long and difficult journey, but an important one. and president trump is committed to bringing an end. >> to. >> this conflict. >> we are trying to bring an end to the conflict. apparently, we're also asking for something on the order of 500. was it $500 billion in terms of access to minerals and other things from ukraine? is that a fair deal? >> look. >> you i.

>> don't know anything about. >> the deal or. >> in the intricacies. >> of it. what i would say is, first of all, you put up people. >> on. >> the screen. >> who are very talented. >> so if i look at this. >> from an entrepreneurial. >> perspective. >> the first thing i'm looking. >> at is, okay, those two. >> people are very talented. the second thing, i think i'll tell you something. i think trump does very. very well. >> he says. >> i'm not going. to accept. >> a. >> paradigm that essentially. leads to a stupid conclusion. and he's. >> like. >> okay, great. i'm going. >> to give you a. new paradigm. >> you don't like that? my paradigm. >> give me another one. and i think. >> he's honestly i think he's quite. >> brilliant at this. so what i see is he's like, i'm. >> not accepting a paradigm where america just keeps financing thing. >> there's no. >> real discussion. i'm sending three of the most talented people there. let's figure it out. >> and but. >> and again. >> what i would. say to people who. >> are trying to figure out how to make themselves. >> how to be builders. >> is do not accept a paradigm that is stupid, no. >> matter who. tells you that you should have it. >> okay, let me ask a different question about paradigm shifting. so one of the things that's going on right now. elon musk working with the doge team

in washington to try to get at some of the misspending that's been going on over the years fraud. >> waste and abuse. >> and i think there's a lot of people who are super supportive of that. at the same time, you're hearing about resignations and all sorts of other things of folks who are questioning the access that they're getting to data. you are somebody who lives within data. you care about safety and security of data. do you think we should have those concerns, and is there a way to do whatever is being done right now so that you can take the country and those who are questioning all of this with you? well, if you will. >> i you know. >> look. >> i what i don't like. >> about what's going on is i. >> just view this as well. >> let's watch the democratic party commit suicide. >> and like. >> i've been a democrat. >> most of my life, i would still. >> i kind of view myself as outside. >> it, but i don't. >> like watching the democrats. >> just commit suicide. and what i see. is most. >> of the country. >> doesn't really at this point, given the fraud, waste and abuse we know, is there 90%. >> of the. >> countries like get rid of that fraud, waste and abuse? and i, i just view this as yet.

another example of the progressive left. >> boxing themselves in. >> into a suicide dance. now, if you what what the progressive left should be. >> doing is saying, okay, ellen. >> you're clearly the most qualified person in the world to do. >> something like this. we want a dialog. >> with you about how you're doing. >> and what you do. >> i don't believe that's actually. >> what happened. and again, i probably i like ellen i know i think he's the he's obviously the most. >> important builder in the world. and i just. >> think if you want to say my former side, i. >> don't believe. >> that they're actually engaging. >> i think this is it's like. >> another dance. >> where i'm supposed to say, of course, like whatever. it's like there's this one issue where i. might and then you get. >> boxed into, you cannot. >> solve the problem. >> and then. >> i. >> would say, what is the biggest problem in this society? biggest problem in this society, from my. >> perspective, is legitimacy. >> of our institutions. why aren't they legitimate? they're not legitimate because okay. does it. >> do any of you really believe

that. 99% of your taxpayer. >> dollars are being spent? >> but last and not least. >> and. >> probably arguably. >> most importantly, there's two revolutions happening. one is transparency and one is ai. >> okay. >> so why is. it that we do not. >> know where. >> every penny of. >> our money goes? like, how do you. >> explain that. >> to people? >> and. >> and by the way. >> slightly more technically. >> what large. language models do is they mean you can. >> go into the contracts and see exactly what happened. so in the past we. couldn't do this. now we can. the right response is. >> we want. >> this. >> to happen. we want. >> to happen. >> we want. >> to be involved in the dialog. the real response. >> is it feels. like the people. >> criticizing elon don't want it to happen. >> and this. >> is. >> going to destroy. >> those people. alex karp, the book is called the technological republic. i want to thank you for being here. come back to this. you can come back tomorrow. can you come back the next day? we can do this. >> we're going to like. you know. >> i'm not. >> used to. i always thought i thought this was a joke because i'm not used to being

re-invited. >> no, we're starting at six. >> oh, we'll. >> see you starting. >> at six. >> we got three hours every morning because you're just getting started. we're not, we're not, we're not off. we got about. >> 15 seconds before we. >> i'm telling you, i. >> just told everybody i. >> want you back. okay. well, i, i'm. not used to, like, you know, the groucho marx thing. i wouldn't go to a club that would have. >> me as a member. >> i'm not used to being re-invited. >> see you. >> tomorrow morning. take care. make sure you join us. squawk on the street is next. good tuesday morning. >> welcome to. >> squawk on the street. i'm david faber. >> with jim cramer. >> we are. >> live from. >> post nine at the. >> new york stock exchange. >> carl has the. morning off. >> let's give you. >> a look at futures. it's a shortened week. remember it is tuesday. doesn't feel. >> like it. >> but look at that. >> we may have a higher. open first time. >> in three. what we had three down. i can't call it mondays. >> this is actually synthetic wednesday. >> but you know. >> what i mean i do i know exactly what you mean. >> what we look like we're going to have a higher opening a half hour from now. >> when we get started.