>> and many. >> other issues, things like the economy. >> taxes. >> much more. when we speak. >> with treasury secretary scott bessant, that's coming. up right. at the top of. >> the. >> seven in studio. squawk box begins right now. no. >> good morning everybody. >> welcome to squawk box right here on squawk. >> on cnbc. >> we're live from the nasdaq market site. >> in times. >> square i'm becky quick. along with. joe kernan. >> and andrew. >> ross sorkin. and here we are on this friday. >> that has been. >> a. >> pretty tumultuous week for the. >> markets right now. >> you're going. >> to. >> see. >> that the us. >> equity futures are a little bit higher this morning. dow futures up by 43. >> s&p futures are up. >> by 15. the nasdaq. >> is up. >> by about 80 points. but the s&p. >> is coming. >> off its sixth straight session in which it.

>> moved at least. >> 1% up or down. that's the. longest streak of that kind of volatility in. >> more more. >> than four years. yesterday we did see weakness across the board. the dow was. >> off by about 1%. >> the s&p was. down by 1.75%. the nasdaq was down. by about 2.6% 2.8%. if you were looking at the nasdaq. >> 100 and we are talking. >> about some losses that are starting to kind of add up, just the idea that you're now looking at the s&p down by 6.6% from its all time high. >> the nasdaq composite is actually in correction territory. >> if you're. >> looking at that. >> it's off by 10.5%. the nasdaq 100, which. >> is the. >> composite that we watch more closely on our boards. it is just below 10%. it's nine point 9.75% off. so you're talking about the losses that have started to add up. and maybe it was what the president said yesterday that maybe. has the market on edge. just the idea that he's. >> not. >> looking at the stock market right now. >> it's just everything. >> yeah. >> i think i tried to. >> find out. >> from the first term. >> do you.

>> remember he he used the term house money at. >> one point. >> playing with house money. >> where the stock market had advanced. >> so much. >> that he thought it. >> gave him the. >> opportunity, the opportunity. and we can take. more risk. we can ask the treasury secretary whether in the back of anyone's mind. >> i don't know how long. you know. >> he holds that that. >> i think. >> you get to it every. >> year, not. >> every year. >> but normally there's a 10% correction. >> yeah. >> so it's not, you. >> know, unheard. of to see that. >> but and. we're not. >> there yet with the s&p. >> we're we're. >> there with. >> the nasdaq. >> we'll ask you know. >> we'll talk about this a lot. >> with the treasury. >> secretary who's coming up. i mean, the thing that struck me though is this is. >> kind of putting the markets. >> on notice. i'm not using this as my scorecard all the time. that's what they've been saying in this administration. he did use that the last time around. and that's what his last treasury secretary kind of always pointed to when he was on with us. this treasury secretary has talked a lot more about the bond market. and. >> well. >> and so.

>> did trump. trump did not. the president the other night did not mention the stock. >> market at all. >> but he called it a big, beautiful drop in in the ten year, i think, which does help with mortgage rates. >> it does. >> do we? >> it's so. >> much. >> that what if it's a if it's down because you're worried about growth. >> right. >> right, right. that becomes the. >> and he's but he's. >> going to be not. >> interested in the stock. >> market until he's interested. >> in the stock market interest in stocks. >> you either have there. >> will. >> be if it continues this pace. >> there will be a moment. >> where you. >> will have to start to grapple with it. >> that need. >> to. >> be reelected, though. and he does. you know, you heard. scott yesterday talking about a recalibration. we'll ask him about that. i want to drill down more on on the whole notion that, you. >> know. >> we always. >> ask, what do we ask. >> treasury secretaries. >> strong dollar. >> do they. >> really. >> really are they. >> really, really. >> that's what. >> i was. >> looking at. they really, really want a strong dollar. >> are they kind of sort of want to start. because i can give you a lot of reasons why a weak dollar would help with what they're. >> trying.

>> to do. >> for exports for. >> you know. >> if interest rates are going to come down, you don't necessarily want it would sort of play into the whole and they're departing from everything else we've done over the last decades in trade. so why not depart? >> this is. >> and then the other question that i was kind of kicking through, the president did also acknowledge in his speech this week to congress that. we could be in for some short term pain is what's their idea of short term, right? >> like how. >> much pain. >> are we talking, how long. >> and how deep. >> would how. >> long. >> has this been going on. >> right. how long would you tolerate some of those issues too? but it's. >> all things. >> that we're. >> going to talk about with. >> treasury secretary. >> when he joins us right. >> here on. yeah, right here on set. and i like that format. so much. you know, the one on one i've seen him do one on one. i've seen him do how many. one on ones in a dark room with a light and a camera. it's like it's just much better to have a discussion and you're ready, aren't you? and you're ready and you're. you're ready. i'm ready. president trump issuing tariff exemptions for a variety of goods coming into the us from

mexico and canada until early next month. the delay applies to products covered by the us, mexico-canada agreement usmca. what can you do? >> you s. >> m, which trump signed in his first term, a white house official said about half of mexican imports and 38% of canadian imports fall under that deal. so the exemptions are going to last until april 2nd, when who knows what happens then when the white house plans another round of tariffs on a range of countries that there's some reciprocal ones going in, then i think trump addressed yesterday the tariffs with reporters in the oval office. >> but this is something that we have to do. there will always be a little short term interruption. >> i don't think it's. >> going to be big, but. >> the countries. >> and companies. >> that have been. >> ripping us. >> aren't particularly happy with what i'm doing. >> but the united. >> states will be very happy.

and, you know, our farmers are going to be very happy. and again, there'll be disruption. >> the move to. issue the exemptions came two days after trump hit canada and mexico, with new 25% levies, though he quickly gave automakers a one month exemption. you might recall, the president said, the sharp market responses this week to the trade news had not impacted his decision to delay the tariffs. the latest reprieve did not include china, by the way. in a news conference today, china's foreign minister said his country would continue to retaliate for what he called arbitrary tariffs from the united states. >> meantime. >> oh, sorry. >> president trump. >> signing an executive order to create a strategic bitcoin reserve. but cryptocurrencies fell as traders seemed disappointed with some of the details. >> in a post on. >> x, white house crypto czar david sacks. said that the reserve will be funded. exclusively with bitcoin that. was seized in criminal and civil

forfeiture cases. he also said no bitcoin will be sold from that reserve. trump's order also establishes a us digital asset stockpile to hold other confiscated cryptocurrencies. and we're going to talk more about that story. >> later this. >> hour, okay. >> we've got a lot more coming. >> up on. >> the broadcast. the markets. >> as we count. >> down. >> to the february jobs report. plus. >> as we've been mentioning, you don't want to. >> miss it. >> next hour, our special interview. >> with treasury secretary scott bessant. >> stay tuned. >> you're watching squawk. >> box and this is cnbc. >> this cnbc program is >> this cnbc program is sponsored b ♪(voya)♪ there are some things that work better together. like your workplace benefits and retirement savings. voya provides tools that help you make the right investment and benefit choices. so you can reach today's financial goals and look forward to a more confident future. voya, well planned, well invested, well protected. and the celebrations,

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>> welcome back to squawk box. >> shares of. >> computer chip maker broadcom soaring on first quarter earnings. >> the company beating. analysts profit. >> revenue expectations. >> posted 77%. higher ai revenue also giving a strong sales guidance for. >> the current quarter. broadcom one of the primary data center infrastructure. >> vendors for ai working. >> with google. >> and other key companies. >> its stock price more than doubled in the. >> past year. now, yesterday's market sell. >> off. >> dumping the. >> nasdaq into correction. >> territory as we await the february. employment report. i want to bring in jack manley. >> he is. >> the global market strategist at j.p. >> morgan asset management. >> good morning. >> morning. >> so help. >> us help us understand what you think. is about to happen here. >> we've got all these tariffs. the market's been in just a world of turmoil. maybe is the

fairest word. are you of the view that this is a temporary hardship or this is more permanent or this is an opportunity. >> i would say temporary and. >> as a result. >> probably an opportunity. i mean, when you have valuations. >> as high as they. >> are and as high as they were, you are always. >> more susceptible. >> to shocks. >> and there is. >> no. >> shortage of shocks right now. >> i mean. >> we have of course, policy shocks. >> that translate into potential macro shocks that. >> translate into. >> rate shocks. >> you have on the other side, news. >> like deep. >> sea from what, like a month. >> ago. >> at this point. >> throwing a little. >> bit of cold. water on the ai story. >> and now. >> jobs coming out later today. all eyes. >> are going to be. >> on. >> that because of these. >> concerns about a. >> growth slowdown. >> it's a. >> market. >> that's very sensitive, i. >> think, to headlines. >> and it doesn't surprise me. >> there's been a lot of volatility. >> but when i say opportunity do you do you look at this and say oh well things just got cheaper. >> they're on sale now. >> we should. >> buy up. >> i you know we usually. >> advocate against time in the market. >> but to. >> me that always means. >> time in the market. >> on the downside, you don't want to. >> sell when.

>> things are looking rough. but if you're looking. >> at. >> a 10%. >> correction relative. >> to. >> all time. >> highs. >> do you believe that we'll never get back to where we were. >> a month. >> or two ago? >> if the answer to that is. >> no. >> you don't believe. >> that, then you probably rather biased. rather buy it down 20, right? well. >> the flip. >> side is where do you think will be a year from now? >> i am optimistic. >> about the overall health. >> of. >> the. >> equity market. my baseline view for the economy right. >> now is. >> probably modestly above trend growth, reasonably tight labor market probably right around where we are right now. slightly warmer than we'd like. >> inflation rates that don't move. >> down a. >> whole lot. >> and in. >> that environment, if the labor market is tight and the economy. >> is. >> growing north of. >> trend. >> you have. >> to be. >> risk on. it's a good environment for profits. >> the trick here. >> is that given. >> all that. uncertainty with the macro, with the policy, with the rates, this is not, i think, a beta trade. i'm going to guess. >> under the surface. >> there are going to be a whole lot of winners and losers, a whole lot of chop. >> what is the ten year tell you. and do you assume if there's a slowdown in the economy, do you assume that's bad for stocks? because i think

the crack addicts are waiting for five more five cuts this year or something, or instead of 1 or 2. i think they'd love it to be back in. there's times i think that growth is less important than the fed. >> it feels. >> like a lot of this stuff has become sort of unimportant. i mean. >> whether it's the ten year overall rate, policy. >> growth, i mean, when. >> you talk about. >> the engines. >> of growth in the. >> equity market, this. >> i story you were talking. >> about. >> earlier, the fed, when it comes right down to it, is the growth engine in the stock market or it has been certainly. although to be. >> clear, the mag. >> seven was able to shrug off overnight. >> rates at, you know. >> 20 year highs. >> so like. >> where is where is the. >> sensitivity here in. >> the biggest, most. >> dynamic parts of the market. >> and i. >> is a long. >> term trend. i guess the big. >> thing, the question i'm trying to get. >> at is between. >> the tariff story, which has created this sort of remarkable level of. >> uncertainty, which i think you're looking. >> through past. >> something. >> i don't know. yeah. >> and then what i imagine. >> will be another fight come the summer, if not earlier. >> as it relates to taxes. >> that will last a very. long time, that it's going to be so

choppy that when you say this is the opportunity. >> and again. >> i'm not a market. >> timer, right? >> but i would think things will get worse before. >> they get better. >> so, you. >> know. >> that goes back to joe your point right. like you can buy a ten. >> but why not. >> buy down 20. the question is are we ever actually. going to get there? i'd rather have that bird in hand. i mean. i remember. >> back in 2020. >> when. >> the market's down. >> 34. >> 35%, whatever it was, i had. friends reaching out to me saying, well, surely. >> we're going down. >> to 50. >> i'm going. >> to wait. >> and then they. >> miss. >> out on a, you. >> know. once in. >> a generational. >> buying opportunity. i don't want to bank. >> on future losses when. >> i. >> can already lock in that 10% correction. >> a better starting. >> point, tom. remember we were down monday and he said or we were up monday. but he said, this isn't it, but i expect it to be to bottom this week and. this week. yeah, he said this week expect at the bottom choppy. and he's been saying choppy for the first quarter or at least for the first couple of months, although we'll know next week whether. >> it was. >> well we. >> had amy wu silverman on who

talked about the technicals and maybe that was wednesday. >> yeah, it was wednesday. >> she said that this is the first she's felt like this since 2017, 2018, where she is worried about the levels they're seeing and worried about. >> the volatility. that's good or bad. >> yeah i mean she was more worried than she's been in a long time. and i don't know what that tells you on the technical side of things or if you even watch. >> them i don't really watch the technicals. >> we're much more fundamental driven. >> and you know, honestly, our whole ethos has always been. >> that long. >> term view. and that doesn't mean 20 years. it just. >> means beyond the you don't need a lot and you don't need a lot to feel to want to sell this market. you don't need oh, no, it's all around you. >> not not. >> at all. that's usually positive. >> it's going to. >> take an iron gut. >> to stay through it. >> i think. >> you'll be rewarded. >> okay. jack. >> thank you for coming in. >> this morning. nice to see you. thanks. son of john, the famous. the late, great john manley. that was a great friend of the show. >> that's right. thank you. jeff. >> very, very funny, affable guy. you know that, i guess. oh, yeah. very funny. coming up, the ceo of boeing and kroger's new

interim ceo both talking about culture in companywide meetings. the executive edge is next. i still need to know more about this whole kroger thing. i don't do you know this sorkin event? you got ears everywhere. i'm not sure. >> becky i don't know. >> this is from cincinnati. do you see the guy? what was he up to? i want to know. plus, at the top of the hour, we're going to talk tariffs, crypto and a lot more with treasury secretary scott best as we head to break. check out the shares of hp enterprise. earnings beat estimates. but guidance fell short and the company announced a new cost cutting program, including a 5% workforce reduction. that's not helping, reduction. that's not helping, though. squawk box will be (♪♪) you can fit a lot of vacation into a weekend. (♪♪) book your next weekend getaway with vrbo. (♪♪) -honey... -but the gains are pumping! book your next weekend dad, is mommy a "finance bro?" she switched careers to make money for your weddings.

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>> boeing ceo kelly ortberg held a town hall meeting with employees yesterday. he said that the company needs a more open culture, where. workers are encouraged to speak up and communicate across divisions. that's according to a partial transcript of the meeting that was viewed by reuters. ortberg said that a cultural change was needed to boost morale, and that the results would show in the marketplace. he said a survey conducted in february received responses from 82% of his staff, and that he expects the results to be pretty brutal to leadership. in his words, he's stepping up leadership development and urged managers to listen to and care about their staff. that's daca for the one year, down by just over 21%. >> yeah, it's on its lows mostly, but i mean, it's not quite. actually, it's doing a little bit better. stephanie link loves that stuff. that's the favorite stock. kroger's interim ceo ron sergeant, spoke

to employees yesterday following the company's quarterly results. and according to a recording that was viewed by bloomberg, sergeant told workers that ousted ceo rodney mcmullen was a good man and will always be a good man. he didn't provide any insight on mcmullen's behavior that kroger said was inconsistent with its policy on business ethics. i mean, we're talking a christmas party lampshade type thing, or i mean, what do we i. >> mean, i don't know. >> there were. >> whispers to the post that it wasn't anything all that serious. >> didn't have to do. not an employee of kroger. you know, cincinnati is a really conservative place. probably doesn't. >> look, he forfeited over $11 million, but i think he's got over 400. yeah he does. >> yeah he does. he's a half a billionaire. it's almost it's been there 25. it's been there a long time. >> relatively speaking. and remember what just happened with this company. they did spend a lot of money. >> he did. and that was him trying. >> to get there.

>> but that's not what they said. the reason. >> was it was not. but you could imagine they're not happy. they're also being sued. >> can you make a call? we're going on break soon. can you? i'll try to get to the bottom. >> of it. oh. >> sergeant. also. >> curious minds want to know. >> yeah. he also took the opportunity to encourage employees to be more efficient. he told them don't attend meetings that you don't need to attend. oh, i like that. shorten meetings that are too long also. sounds good. and if there are meetings that shouldn't be meetings, kill them all together. okay. this guy, i think, is a big future. >> it's their own version of doge going after the bureaucracy. >> exactly. i don't know what middle managers are going to do at kroger, but coming up. >> we may. >> try to get the answer to the kroger. >> story during. >> the broadcast. really? honestly. >> we're going to try. president trump, meantime. >> though. >> does not plan to. >> use. >> an influx of taxpayer money to fund the new. us bitcoin reserve. we're going to explain.

what is going on in just a little bit. and we're. >> going to talk more. >> about that. >> at 8 a.m. when. >> we're joined by robinhood. >> ceo vlad tenev. >> we also. >> can talk. >> to the treasury secretary about it. >> it's 7 a.m. right now as we. >> head to a break. >> a look at yesterday's s&p 500 winners and losers. >> executive edge is sponsored by at&t business next level by at&t business next level moments. need the next lev 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! ahhhh! [crashing sounds] we had everything we needed. is the internet out? don't worry, we have at&t internet back-up. the next level network for small business.

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financial advisors at smartasset.com. >> good morning. >> welcome to squawk box right. >> here on cnbc. >> we are live at the nasdaq market. >> site in times square. >> take a look at the futures. >> right now. a little bit of green on the screen that's. >> had a lot of. >> red on it frankly. >> all week right. now about 60. >> points higher on the. >> dow 17 points higher on the s&p. >> and the nasdaq. >> looking to. >> open about 93. >> points higher. >> meantime shares of retailer gap they are sharply higher. take a look at this. up about 18% recouping some losses. >> after some. >> challenging reports from other retailers over the last couple. >> of weeks. >> earnings for the holiday quarter. coming in at $0.54. >> per share. >> that beat estimates of $0.37.

revenue also beat in comp sales rose by 3%, that is, versus an estimate of 1% full year. >> guidance in line. >> with expectations. >> and last night on. >> mad money. company ceo richard. >> dickinson outlined. >> the company's exposure to president trump's tariffs. >> as we look at tariffs, it is, you know, something that we're monitoring developments around very closely, as we all are. it is important to note, you know, we source less than 10% of our product from china. we have less than 1% of our product from canada and mexico. and that's by the way, combined. >> and then when. >> asked if the company will raise prices, he said the goal. >> is to minimize. >> the impact to. >> the consumer, which is what all companies want to do, but also means you might have. >> to. eat some. >> of those costs. >> all right. >> president trump signing an executive order. we've been talking about it to create a strategic bitcoin reserve mackenzie sigalos joins us now with more. we talked about it earlier and i don't know whether

it's true or not. but it was in the teleprompter. so it must be true. but it was disappointment about the some details of the bitcoin reserve causing bitcoin to go down yesterday. >> yeah. >> the crypto market has been plunging since. >> last night on that. >> we know that it was because of what they said or i mean bitcoin you know moves 30% when you know it does that in its sleep sometimes you know over over a period. do we was there disappointment. if so what was the disappointment. >> the big. >> expectation was that we would. >> see some. sort of bitcoin purchasing plan. in tandem. >> with the. >> announcement of a strategic. >> bitcoin reserve. but the. >> language in that executive. >> order was very. specific about it, just meaning that. >> we would. >> hold on. >> to. what was. >> already seized in criminal operations. >> rather than roll. >> out any sort. >> of taxpayer. >> dollars into. >> a buying scheme. >> who wants that? no one wants taxpayer dollars going into it. >> senator lummis put forth. a bill last year where you'd buy 1. >> million bitcoin over. >> the course. >> of five years. >> you'd hold on to that. >> for 20.

>> years and periodically. sell it off. >> to pay down the, you know. multi-trillion dollar deficit. >> we've sold in the past when we've come across some bitcoin one way or another, and we sold it when it would have bought a pizza, and now it would buy a, you know, a building. >> well that goes to the. >> larger thesis here. why some. >> people are actually. >> pleased to see that. >> we. >> would have. >> this, you know. >> strategy where. >> the us government would hold. >> on. >> to bitcoin. >> because the benefit here, the argument. >> is. >> that it would be. >> a hedge against inflation, because there's this. >> capped supply of 21. >> million tokens. and so if you have that backing up. >> the us dollar, it would protect. >> against inflationary pressures that would hit. other fiat currencies. >> there's also. >> this idea that it. >> would diversify what we. >> already have in. >> our national reserves. >> you know, other assets like. >> a gold that might be. >> more sensitive. >> to central. bank policies. >> what i will. >> say, though, bitcoin. >> moves on fed decisions. >> when the rate. >> goes, is hiked or is cut. bitcoin price responds. >> plus, you know governments around the world are not unanimous in believing bitcoin is anything at this point. well,

maybe we are. there's still people that don't believe it's actually a store of value. it could. there's people that still argue it could go to zero. >> yeah, but there are a lot. >> of members of the g20 who might follow suit. and i was talking to brian armstrong. >> last night. >> ahead of this summit. >> today. >> and he's one of the. >> members who's been advising. >> the trump transition. >> team since. >> the. >> campaign trail. and he made. >> the point. >> that he thinks a lot. >> of countries are going. >> to follow. i know, i know of already. middle eastern. >> countries. >> gulf states that have been. >> looking. >> into a bitcoin buying strategy. >> there's also reportedly. >> you. >> know, conversations within the. chinese government. >> to look. >> to. >> follow suit. >> if. >> the government and the. >> us makes this move to in. >> to roll out. >> a purchase plan. >> but there. >> is no purchase plan. >> yeah, exactly. well, i mean, if you have. >> a strategic. >> bitcoin reserve, you know, china. used to. >> be one of the epicenters. >> for bitcoin mining. >> it's very easy for them. they have all. >> of this hydropower. >> and so they already have. >> all the facilities. >> and they banded a. >> couple of. >> years ago. >> but it takes nothing to. >> turn it back on. >> and then. >> i mean similar to iran.

>> evading sanctions. >> by just. >> mining bitcoin. >> they already have. >> it on hand. >> but if we're. >> not really buying. it right, we're not going to be buying it. you agree with that? >> i think that. >> right now we. >> have around. $17 billion worth of bitcoin. >> and holding on to that is enough of a signal. >> that. >> other countries would. >> follow suit. i think. >> that there. >> is an intention, i mean, some of the language. >> in that eo did. >> say that if they could find budget. >> neutral ways to add it to our balance. >> sheet, they would investigate that. now. >> that, of ■course. >> stopped short. >> of a buying. >> plan, but. >> it signals that they're open to some way to do this. if it doesn't take. >> taxpayer dollars. >> do you know of. >> a way that they could do it without taking taxpayer dollars? >> i mean, honestly. >> i say that because it's just it's the craziest it's. >> the craziest thing i've ever heard in my whole life. >> well, what's interesting to me. is that president trump spent a lot. >> of time with bitcoin. >> miners on the campaign trail. >> and it goes. >> to that larger thesis of other. >> countries that are. >> turning either sanctioned. >> energy in the case. >> of. >> iran or. >> you know, idle resources. >> into bitcoin. >> so that's a way to. >> generate it. and yes, you. >> have. >> like. >> the energy. >> inputs. but you know. >> some of these, the biggest. >> miners in. >> the world are based.

>> in the united states. >> core scientific has a lot of operations. >> across the country. >> and if it goes to a million, it's a great idea. if it goes down a lot, it's a horrible idea. el salvador is one place. >> and they're getting. >> hit hard. >> by the imf right now. >> right. but but who which countries are just totally bitcoin nonbelievers? any of the majors countries. and there are some countries that probably need it more than any other countries because of the problem with hyperinflation. but there are countries that aren't going to do this, at least to it's, you know, the proof is in the china. yeah, yeah. >> i mean. >> there are countries. >> that have flip. >> flopped, right? if you have countries that subsidize. energy power and. >> then you had a bunch of bitcoin miners come. >> in because they saw a. chance to, you know. >> kazakhstan. china at. >> one point. >> to your. >> point, becky. >> have had systems where they start to ban. >> the operation altogether. >> or heavily taxed it to try to disincentivize. >> people coming in to use. >> this cheaper. >> energy to. >> to. >> mine the token. >> right. >> okay. thank you candidate. >> you could do tax. you could do tax dollars might be great. think about that. are you are

you fool with that? no. >> the guy who wants. >> lower taxes doesn't know the deficit. no. but it would be a would be a way. because it would be a way of dealing with the deficit. it's like the idea of whether in social security or in retirement plans, whether you say the government. >> is really good at investing in things like solyndra. i mean. >> you don't want to say you don't want. >> to stay. >> should you go in equities for retirement plans, social security? yeah. should you go in things that can grow or should you be stuck at 2%? if we're stuck at 2%, we're never handling the deficit. so if bitcoin could help by going to $1 million then it's a great idea. yeah right i know. well people had to buy it at five and many people didn't. >> anyway thank you. >> all right. >> when we come back wrapping up a critical week for european. markets and what the big moves that. germany has been making mean for global investors. plus, another reminder to catch our interview with treasury secretary scott bessent. that is at 7 a.m. eastern time, less than half an hour away. we'll be right back.

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can get from him. >> get invested. join the. >> club. >> get invested. join the club today. go to cnbc.com. slash join jim. >> support. >> eu leaders. >> have agreed to increase defense spending. by hundreds of billions. >> of euros. >> this follows signals from the trump administration that europe should strengthen its own security, and a landmark proposal to increase spending in germany. european defense stocks have been surging this week, along with the european markets overall. and joining us right now to talk more about it is michelle caruso-cabrera, mtk global enterprises ceo, also a cnbc contributor. and michelle, this is pretty historic. people are looking at this and saying, wow, this is a complete change in what we can anticipate, what we can expect, what it's going to mean for the entire german economy. >> it is a monumental. shift in modern thinking for germany and basically all of europe. the incoming leader of germany has said, has proposed and is likely to get from the parliament

unlimited. spending ability on defense. >> you know, a year ago, unheard. >> of that. this would be possible. so if they go. from 2.5% of gdp, where they are roughly now to three, 3.5%. that's another 45 to $60 billion worth of spending. >> from germany alone. >> that's why you. >> see the defense. >> stocks there. >> rallying. some of them are. >> up more than. 100% year to date. >> and based. >> on what we saw coming out of europe. >> yesterday, you could see all the other countries. >> do the same thing. >> which means a massive amount of increase in spending from italy, from france, etc. this is and this is driven by the fear. that the united states is no longer. >> going to. >> necessarily have. >> their. back when. >> it comes to step up for ukraine. did they? >> so that's that's. >> the. >> that's the. >> thing that they. >> face right now. >> right. this is a this is the this is the moment. >> this is. >> the whatever you need. >> they said i thought they didn't arrive at a, at an agreement. and you know, my

people said they got stiffed. in other words, supposedly the eu was going to say, okay, united states is out. let us handle this. and then they were they were like the gang that can't shoot straight or are they going to back ukraine, give ukraine what it needs because it's 50 or $60 billion. ukraine will blow through that in a year. >> know that i understand. well. france and the uk have committed to boots on the ground. i think that statement and when you talk specifically about the stocks and what it means for the markets, that suggests that there's going to be a sustainability in the spending commitment. for sure. they don't have. >> enough. >> right now. >> of course. i mean, that's why ukraine happened, right? because they did not show deterrence against russia. if they have been spending all along, it was far less likely that russia would have invaded ukraine. >> right. >> and i think they all. realize that now and that they need to be doing more about it. >> what does this mean for germany's? let's start with economy overall, just in terms of it's not just defense spending. these are other areas that they're going to start raising their spending on.

>> yeah. >> he's also. >> asked for. >> commitment to. >> $500 billion of special purpose vehicle for infrastructure. remember they put in a law during the great financial crisis. >> and said. >> germany could not have a deficit larger than 0.35% of gdp compared to the united states. we're running at 6%, right? i mean, it's huge. so that has really constrained their spending. they've got very high levels of social spending. >> so they couldn't spend on defense. >> they couldn't. spend on infrastructure. their trains don't run on time. >> they don't have five. >> g deployed across the country. right. they don't have. >> fiber. >> optic cables deployed across the country because of this. so now as a result, they have now. >> a more. >> pro-growth attitude. >> they've got to implement it. there are some challenges, but certainly the market is acting like they think. >> that this is nato. they were. counting on us. and that's part of the problem. that's part of the gripe that that president trump has, is that they got to spend on cradle to grave, you know, social programs, because we were and i said something yesterday on twitter. plus, we're subsidizing innovation in

pharmaceuticals. plus we're subsidizing technology. so the united states subsidizing everything. and they're spending, you know, money on, you know, child care across the board or whatever. it irks the president. >> why? >> it irks a lot of people. exactly. so now they're going to have to make harder choices about what they're going to do with their spending. so they are. >> going. >> to have a. reckoning when it comes to social spending. >> we did all that and still grew our gdp 40% faster than than most, i. >> would say. >> the one other thing that's going to hold back europe if they can't change this is their attitudes towards regulation, right? because the one thing. >> that they are number one at. >> in the world. >> is regulation. take a look at i for example. >> you know. >> here we are. we're going to let i rip. what's the first thing that brussels thinks about when it comes to ai regulation. how are. >> we going to. they don't even know what. >> it is yet. >> they don't even know. >> what its. >> impact is. >> so that's. >> going to. >> be something that. >> they have to change as well. but but don't don't miss. don't underestimate how monumental an attitude change is happening. they're driven by fear. and to see the german incoming german

chancellor likely say, okay. >> we're going to. >> we're going to pass an amendment to the constitution that allows unlimited spending on defense. that is a change. that is, that. >> you should. >> not all we need germany arming up again. that's all we need. >> well, what. >> do. >> you what do. >> you want, joe? you want? i mean. >> you want us to defend them or do you want them to. >> defend themselves? >> i mean, you got. >> to, you know. >> defending yourselves. and then the next. >> day. >> you know, japan. >> japan made. >> this transition. >> as well, i remember it. yeah. they weren't allowed either for a while. well, it's a dangerous water. what what disturbed me today was reading the latest comments out of russia. now that they got ukraine right where they want them, they're not going to give anything up. they're not going to concede anything. and they're saying that it is, especially if there's boots on the ground from europe. they're they're not going to give back. it's going to be very difficult to negotiate anything out of russia at this point, given that they've we've shown our hand more or less. >> yeah. >> i wonder if you could think about another way, which is, you

know, the administration could turn to russia and say, wait a. >> minute. >> we've given you everything you wanted, and yet you're still. not going. >> to like putin. >> strike a deal. >> right? >> but then then you have carte blanche to do whatever you want, right? >> but does that mean we're back in as a result? like you're not going to come to the table? >> i mean, we own all those minerals. we're back. >> in sanctions. >> it could be all. >> kinds of things, right? >> it gives if. >> if, if. >> they give russia everything they want. >> putin everything he. >> wants, and he still doesn't want. >> to do. >> a. >> deal. >> then you have carte blanche to take whatever measures you. >> want again. >> against russia. >> right? but you don't think he's going to do he doesn't want. >> to do that. >> i don't think he does either. but, you know, you. >> get to. >> that point. >> it's going to be a very interesting moment. >> you know, if. >> he doesn't. >> give in, if he doesn't strike a deal with putin, i'm talking about. >> then then we're in a very different. >> one last. >> question for you. >> what do you think the chances. are that banks in america have branches in moscow in the next four years? >> no joke. >> i think it's pretty high.

yeah, right. >> i think it's very interesting. >> just think about that. think about. >> that a little longer. i don't. >> think. >> it's just. >> mcdonald's banks. >> i think it's i think no, i. >> know i think. >> that a lot of american companies may. >> be back in. >> russia. >> companies that had to give up, you know, their plants. >> etc. >> etc. >> their production. >> yeah, exactly. michelle. thank you. >> you bet. good to see you. >> yeah. >> thank you. >> okay. >> coming up, a light. >> show in. >> the skies over florida. >> though this is not necessarily. >> the light. >> show you want. >> to see. it's the latest spacex. >> launch and. >> a partial. >> failure. >> as we head to. >> a break. check out crude prices. >> in a speech. >> yesterday, treasury secretary. >> scott bozeman is going to be with. >> us in just a moment. >> said the u.s. >> is deploying sanctions against iran designed to shut down the country's. >> oil industry. >> the secretary. >> will be with. us at the top. >> of the 7 a.m. hour, and we've got so much. >> to. >> discuss with him. >> it's an. >> important day. >> is coming for every american with money in the markets, and it will be here sooner than you

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or stop by. >> granger for the ones who get it done. >> the faa. briefly. halting flights to several florida airports. >> last night. this following. a testing failure from elon. musk's rocket company. >> spacex affected airports. >> included miami international and. >> facilities serving. fort lauderdale. >> west palm beach and orlando. >> now, a live stream. >> of the. >> eighth test. >> of the test. >> flight for spacex's. >> starship. showing several. >> rocket engines. appearing to. >> cut out. >> the company then lost communication. with the spacecraft, and. >> video showed debris. >> raining down. >> spacex was able. to successfully launch the rocket's. >> booster engine at its facility. at the southern tip. >> of texas. >> and it's a very unusual situation because it's seems. >> so bizarrely. >> beautiful to. >> watch these things rain down. but when you think. about what is raining down. >> it is not how expensive it

is, but these. well, that's part. >> that's part. >> of it. >> it's coming. >> in 4. >> to 5. >> i think. when you see all of this. >> stuff coming down, it's not. >> it looks. >> beautiful in the moment. >> but it seems to. >> be the faa had to stop flights. >> it's debris. no, that's what i'm saying. it's not. it seems to be taken for granted that there will be more as the testing continues. this will happen more. probably many times. yes. yeah. and we're leading to something where hopefully it stops happening completely. >> we can only hope. >> exactly. coming up top stocks to watch in the premarket. and stay tuned for our special interview on president trump's tariffs, the economy and many things. bitcoin reserve treasury secretary scott bessent is here and he will join us on set momentarily. squawk box will be right back. >> the number. >> of. public companies is shrinking while the number of private companies is increasing. at franklin templeton, we are expanding access to the growing opportunity in private markets, offering the potential for greater diversification and

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>> futures this morning. >> are pointing to a. >> slightly higher. >> open after a pretty difficult week for the markets. we've been watching what's been happening this morning. let's get down to dom chu. he's got a look at this morning's pre market movers. dom what are you seeing so far. >> happy friday becky joe andrew. let's start off with shares of costco which are lower on sales coming up short of estimates. costco ceo hitting on president trump's tariffs saying that grocery margins are now much tighter than in the past and members are likely to become more selective. so costco shares down on the heels of that report, down 2%. meanwhile, you've got baird analysts upgrading jp morgan chase and bank of america bank of america to an outperform from a prior neutral. and jp morgan goes to neutral from underperform. big bank stocks have been struggling hard after president trump's announced tariffs, but analysts say recent weakness presents a good buying opportunity to get into industry leaders like jp morgan and bank of america. those shares, both up between one half and 1% on the morning so far. now for that. another top analyst calls of the day.

just head over to cnbc.com. pro subscribers get all access to the detail and analysis behind those big stories and calls. and we're going to end on shares of broadcom which are actually jumping this morning. big up about 11% beats on both revenues and profits. and stronger than expected semiconductor revenues. ceo hock tan saying the firm's biggest customers continue to invest aggressively in next generation ai models. so broadcom a big bright spot. but we can see here the near term trend becky has been weakness over the course of the last couple of months. we'll see if that continues. i'll send things back over to you guys. >> okay. don thank you very much. when we come back, our can't miss interview with treasury secretary scott bessent. that is right after a break. stay tuned. squawk box break. stay tuned. squawk box will (♪♪) (♪♪) what took you so long? i'm sorry, there was a long line at the thai place.

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morning. >> i'm andrew ross sorkin, along with. >> joe kernen. >> and becky quick. we got a. >> lot going on. >> the futures. >> right now. got some green on the. >> screen after what's. >> been a. tumultuous week. s&p 500. up about 1617 points. now the dow jones looking about 58 points higher on the. >> nasdaq up. >> about 92. >> points higher. >> take a look at the. treasury yields. we're going to. >> talk about this with the treasury secretary. >> in just a moment. the ten year. >> sitting at just about 4.2. >> and we're looking now. >> at the two. year at about 3.95. we'll get to those probably there's some other things that start with the t we might talk about first. now to our headline guest of the morning, treasury secretary scott bessent. it's great to have you here. great to have you on the set. so i think in general, people would call this a what we're doing, kind of a radical departure, i think, from from decades of what we've seen as far as our global trade policy, as the leader of the free market world, we have always been issued these, these,

these tariffs. et cetera. i think can you just make the case that, that when we come out on the other side of this, we're going to say, wow, it was really, really worth it. i think you started to do that yesterday. you started to talk about what that looks like. can you can you fill in some of the blanks on how you see this playing out? sure, joe. >> and i. >> don't think. it's a radical change. it's just a. >> much needed. >> course adjustment. and when we go back and look at what's happened, there's a new paper out. called the china. >> shock. >> and it talks about what. happened post 2004. >> that some of the communities. >> recovered, but the workers never. >> recovered. >> and that it was much. >> more devastating on a human level. >> and what we are trying to. >> do is. >> make free trade. >> fair trade, because. >> the trading systems have. become incredibly imbalanced. you see it with. >> these gigantic. >> the trade deficits that we run. you see it with the big surpluses. that other countries

are accumulating. so we're going. through we're looking. >> at tariff barriers. non-tariff barriers. >> currency manipulation, government subsidies. and in the eu. >> some of these gigantic fines. >> that they're putting on our tech companies, just because they see a big pool of capital. and we're going to push. >> back on those. and at. >> the end of the day, president trump's. >> been saying. >> tariff is his favorite word. i think reciprocal may be his second favorite word. and we're going. >> to put. >> this at the feet of our trading partners. on april 2nd. >> we're going to come. >> out. >> talk about who, who, who's a good actor, who's a bad actor, to what degree they have put they put up barriers against us. and it will be a choice. either the they can drop the all the market manipulation and things like that, that they've done that have hurt american workers. and if they do that, then we could have more frictionless trade. or we'll put up the tariff wall, we'll collect a lot

of money, and we will. make the system fairer. >> the couple of things, i think you've made the point that unlike the printing of too much fiat currency, which might be an underlying cause of inflation, the tariffs don't cause long term inflation. they could cause some price increases. but but not long term. but then at the same time, you said that americans don't necessarily just want everything to be really cheap. they want our workers to be employed here, and that the prosperity here doesn't mean being able to buy cheap goods. it means being able to live the american dream through having a job and having a future. et cetera. so we're going to have higher input costs forever. >> so what? higher input costs forever. >> no it's. >> the tariffs are one time. >> price price. adjustment and everything. >> else the administration. >> is doing. >> is i. >> we're not getting much

credit. as of yesterday energy prices. >> were down 15%. crude was down 15% since. inauguration day. >> ten year. >> rates are down, mortgages are down. >> the spreads between. >> the ten year rate and mortgages have. >> come in. so we saw. housing the we saw mortgage applications. pop up last week. i think if we can keep on that trajectory. and joe, the american dream is. >> to be able to buy a house. >> we can't import houses. >> this could all be a reflection of the economy slowing. an investor who. >> used to spend their day investing in all this stuff. do you look at the ten year? >> do you look. >> at. >> all. >> of the. >> signs that. >> you just talked. >> about wti and everything else and say, that is. >> the work. >> of the government and a newfound confidence in what's happening to the economy, or that's actually a concern about what's going to happen to the economy. >> well. >> i think it's both. because we could have the worst of all worlds, because, look. and i'm not new to this. when i was on

your show. >> last time. >> i've been saying it for 6 or 9 months. >> i believe. >> that the biden. administration and back to joe's question. >> the on. >> working americans. >> and what is the american dream? >> but the biden. >> administration created. >> this bad equilibrium where the top 10% people, people. >> in this. >> room. >> probably most of the people watching this. >> show. >> top 10% of. americans are 40 or 50%. >> of consumption. >> and that is an unstable equilibrium. the bottom 50% of working americans have gotten killed. we are trying to address that. we're trying to get rates down. and, you know, could we be seeing that the this economy that we inherited starting to roll a bit? >> sure. >> and look, there's going to. be a natural adjustment as we move away. from public spending to private spending. the market and the economy have just become hooked. we've become addicted to

this government spending, and there's going. >> to. >> be a detox period. there's going to be a detox. >> i think. >> that. >> that temporary pain that you've acknowledged that the president has acknowledged, i think the question becomes, is, is temporary pain the new transitory inflation? how do you know that we get to the other side of this? and how long do you think it actually takes? >> well, look, there's an adjustment. we'll see whether there whether there's. >> pain. >> what we are trying to do. i talked about it at the economic club of new york yesterday. we are trying to transition from public to private. and i talked about we are going to have safe and sound. regulation to get our banking system going again. so the banks should be generating loans. to private companies. employment should be from private companies, not from government. >> and i'm. >> confident if we have the right policies, it will be a very smooth transition. >> i'll ask.

>> you this. >> i was with a whole bunch of ceos last night, and they were talking about investing in the united states. question about bringing manufacturing back here. >> what the tariffs would do. >> and there's sort of a very interesting, almost behavioral science question, which is how long do the tariffs either have to be in place, or do people have to believe. >> that they. >> are there and permanent forever. before the companies decide, okay. >> actually. >> we are going to invest knowing or thinking that maybe they're actually going to come off later. how do you think about that? >> well, look, i think that most ceos and it tariff is kind of the word of the moment. but i actually think what is going to determine that corporate behavior is going to be do we have good tax policy. can we make the tax cuts and jobs act permanent? the are we creating energy securities so that they have the access to cheap energy? are we going to deregulate, which is. another big story of

what happened in the past four years. >> the rationale for tariffs. it's jumped around a little bit. and i can give you i wrote a few down. fentanyl is why we're doing this i guess currently with with mexico and canada. and there's. >> been and. >> china and china, they, they supply the precursor. >> ingredients for fentanyl. >> reciprocal trades. you even have some of the skeptics kind of go well that makes some sense. i want to bring in domestic manufacturing. obviously what you've talked about trade deficits. do you view those as inherently bad? i know the president always points to that. but we do consume, and we're always going to consume more than the rest of the world. and if you do indeed want a strong dollar, it seems like it's something we're going to have to live with a couple of other ones punishing bad behavior, security concerns with china. that's a whole slew of reasons to put on tariffs. and it just at this point, i guess critics would say it looks a

little haphazard. the way they go on, they come off. we talk to mexico and canada, okay. we talked to the automakers. they don't want us to do it. so we're not going to do it. it just seems like it's being levied in a somewhat haphazard way. is that is that not fair? >> i of course it's not fair, joe. but that's what you. >> all do. so not all. >> not ■i. >> look, it's not linear. >> it's an it's. >> an organic process. but if we were to look back to a similar process. over what president trump's talked about it, his first administration, he talked about it in the campaign trail. he's talked about it since november. is the need for europeans to fund their own defense. and you just had a very long conversation with paskas and that all of a sudden. >> voila. >> this week, this week, after 25 years of baiting and cajoling, president trump achieved what five other presidents couldn't achieve. the

europeans are going to up their defense spending. the german debt brake is coming off. that was not a linear process. that was not always an attractive process. but now the europeans say that they are going to pay their fair share. >> i mean, this could all make sense in terms of the art of the deal. i mean, i could see it working, but i could also see it not lasting months or even years. but i could see, because it does seem near term, it could be disruptive to the stock market, it could be disruptive to the bond market, it could be disruptive to the economy and to jobs and everything else. but if there's a method to it where, you know, maybe they don't go on april 2nd if the president gets what he wants, are we necessarily going to be in a tariff world for the next four years? >> well, look, i think some level of tariffs are going to be necessary just given long term long. well we'll see long term. but just given the. level of imbalances. and the other thing too is if we take china.

>> china is the most. >> imbalanced unbalanced economy in. >> modern times. >> they have a very different economic system than we have, and we have let them export their economic system to us, which has resulted in lower wages. loss of the manufacturing base. one very good example would be, as you could see, president trump is scouring the earth to make sure that we have our strategic and critical minerals. that's great. but 85% of the refining of those and processing happens in china. every time a western company sets up a processing firm, chinese competitors drop their prices and put them out of business. >> so how connected in your mind are the tariffs to the later conversation you're going to be having. this year around taxes, meaning that you need. >> the tariffs. >> to deal with certain budgetary issues. and then, of course, the question is going to

be what the tax. >> piece looks like. >> and then of course, the next question is going to. >> be whether. >> the tariffs then stay on to. >> capture whatever. >> savings you're trying to get so that you can make the budget work. >> right. so andrew on, i was in the investment business for 35 years. i thought i understood how crazy cbo scoring is. and now that i'm on the other side of the wall, i can tell you it's really crazy and very unlikely that we are going to get any credit in the cbo scoring the for tariffs. but if you look. >> back. >> the china tariffs, which the biden administration has kept on, has brought in hundreds of billions of dollars. and, you know, so. we will be able to those are going to continue likely go up and then we'll see what the other levels are. but in terms of the actual budget negotiation, tariffs won't be part of the payfors. they will be it will be something that's in the background. >> i think people wonder what

you've laid out. a whole lot of reasons why there's unfair trade around the globe. but i think people wonder with why start with canada and maybe even mexico first, just the idea that they tend to be better trading partners. we had a former us ambassador, bruce heyman, to the us ambassador to canada earlier this week. he said, you guys went after those three because that's where the money is, because he thinks it is going to be used. it's money you need. you need to be able to show and start bringing that money in. and that's why them first. >> yeah. >> no, the reason it's first is because of the fentanyl crisis is that, you know, i'd have to vigorously disagree with ambassador. hammond that it's the fentanyl crisis on the southern border, on the northern border, and all these precursor drugs from china. >> the i called it a radical departure. maybe it's not really a radical departure. i want to talk about the dollar and wonder whether there's the slightest

crack in what we've had from every treasury secretary, and we always ask him the same thing over the years. i've been here so long, been through so many treasury secretaries. i've never heard a treasury secretary say that they're not for a strong dollar, but a weak dollar would would really be an answer to a lot of, of what you're talking about here in terms of trade deficits, in terms of we know what a weaker dollar does for future obligations that we have with 37 trillion in debt. that makes it a little easier. lower interest rates implies probably a weaker dollar. would you accommodate a weaker dollar at all? is there any motivation at all to let that happen? or do we have the strongest dollar policy that we've ever had? well. >> there's no change in the strong dollar policy. but i can tell you when you think what is what is a strong dollar mean? there's the bloomberg currency index and the dollar very strong on that. then their bilateral trading relationships. and is

the dollar strong or weak on that? and is it strong because of us fundamentals. and i can tell you we are committed this administration. president trump are committed to the policies that will lead to a strong dollar if we bring back more manufacturing, if we have cheap energy, good tax policy, deregulate, we will end up with a strong dollar. but what is unacceptable is in a bilateral relationship, other countries trying to weaken their currency. and so we are against the trade. excuse me, currency manipulation on a bilateral the basis. but globally the strong dollar is very important. we will continue as a reserve asset. and i am i think any anyone who has an inclination that this

administration thinks differently on that is wrong. >> as far as the president paying attention to the stock market or the equities market or not paying attention, we in the past we've thought that that is how president trump at some point gauges his success as president. now, he doesn't need to be reelected this time in four years. it's the market's been up 20% in the last two years obviously. so is there any perception with him that that he's playing with some house money? he said that at one point in the past, and i guess what i'm getting to is how long or what type of levels on the s&p do you think you would need to see where he might that might influence some of his policy making decisions? >> yeah. look, president trump takes in a lot a lot of information every day. and stock market stock market is part of it. that again is somebody who was on the other side for a long for a long time. and you say, oh you know where's the trump put

kick in. >> there is no trump put. >> well there's no put that the trump call on the upside is if we have good policies then the markets will go up. >> he says he's not watching the stock market very closely. are you? >> i watch everything but and. >> okay what's your what's the best put i mean you are going you know how the media covers things and we're we're down 6% on the s&p from what you read on a daily basis, it feels like we're down 60 at times. although the nasdaq is down in correction territory at this point. i'm just wondering what if we ever went down 20% on the nasdaq or 15% on the s&p with people that want trump to fail, that's going to be splayed across every newspaper in the world. i'm just wondering whether the tolerance for something like that for the administration. >> well, look, as you said, joe, market was up 20% last year. 20%

is your. >> house money. >> no, no, no, i'm going to put it another way. okay. they did the biden administration succeed? the american people weren't buying it just because the market was up. they voted out. they voted out the democrats. >> question related to the regulatory or. deregulatory agenda, which i think is part of what. you're arguing on a long term basis, is going to help the economy. there's two things that i'm fascinated by. one is that it sounds like the ftc at least, and the administration is thinking of trying to extend or at least be very similar. i mean, that's to what the biden agenda was before, i don't know. and that was sort of some of the commentary about sort of what the next version. >> of regulations look. >> like, which surprised me. the second thing that i was surprised by was actually mergers and acquisitions activity in the month of january, which i. >> would. >> have thought would have been up, but actually. were was down 30%, as if january was back in 2015. and what that says about the confidence, to the extent that you believe that m&a

activity is a barometer of confidence. >> well, andrew, maga doesn't stand for make. >> m&a gradient. >> but i. >> think that, again, with deregulation, with. the more thoughtful oversight at the ftc. and i think that the two new new leaders at the top are very thoughtful, that we will see a pickup in corporate activity. i think what we've seen over the past 60 days or the past six weeks since president trump's been in there, doesn't tell us very much. and again, what will we what will we have seen? i've been meeting with a lot of banking heads, investment bank heads, and i think that things are going to loosen up. >> mr. secretary, can we just talk a. >> little bit about the democrats got voted out in spite of the big run ups in the market. and i think a lot of that was because of inflation and because of what average americans were feeling at the grocery store, at the price, at

the pump, what they were paying for insurance, what they were paying for housing and rent. we did hear from a lot of ceos this week who said that the tariffs. could lead to price hikes almost immediately this week and next week, the ceo of target, talking about prices for fruits and vegetables that we rely on so heavily on mexico this time of year, best buy saying that they would see price hikes that would go into electronics, automakers saying you could see price hikes pretty significantly by next week even. i just wonder, how much tolerance do you think there is from the american people you're trying to help? the bottom 50% of workers, they feel those inflationary prices and it hits home a lot harder. >> well, becky, we'll see how the overall inflation numbers that work out that obviously energy is a big component. so we'll see that go down. committee to unleash prosperity steve moore's group has some very good data on how regulation

affected the average household. so if we're cutting that. so that's why i keep urging people to look across the entire spectrum. if you get a one time price adjustment. and the other thing too is are we going to for the bottom 50% of wage earners, can we see real income gains for working americans? because i think that was the problem last time, that the top 10% did great and the bottom 50% got crushed. so if they start seeing real wage gains because the private sector, as opposed to the government's producing the jobs, then i think that would be a big offset. >> the other night, the president trump said that he wanted to balance the budget as well. so we're going to have the big, beautiful bill eventually, maybe. and i guess the 2017 tax cuts. would you like to see those extended permanently at this point? if you add and where i'm getting to, if you add in a

lot of the other tax on tips, no tax on social security, add it all in, you're not going to get anywhere near a balanced budget unless there's some some cuts. i don't know whether doge does it. what about medicaid at this point? it's it is the one i don't know if you want to call it an entitlement, but it's been growing, outpacing medicare, outpacing social security. and it may not be doing what it was designed to do. at this point, it's doing a lot more. at least states have tried to get it to do a lot more. it's any medicaid cut on the table. >> well, i don't i don't know if it has to be a cut, but certainly. >> slow down and the increases. >> well, slow down the increases or just looking at the system and that empowering states. we had a governor's conference two weeks ago at the white house, and a lot of the states would prefer to do it themselves. and, you know, i'm sitting in the most prolific state for the medicaid, and it new york,

illinois, chicago are big spenders. so could more states get more money? some states have to rein in the overspending. sure. >> what else would would get us anywhere near a balanced budget if we have all these tax cuts? >> well, growth, if we change the growth trajectory again, as i was telling andrew, that when i was on this side of the wall with cbo, i think it doesn't hit anyone like the cbo. scoring assumes 1.7 1.8% growth linearly. so if you hike taxes, growth doesn't move. if you cut taxes, the growth doesn't move. so i think if we make the current tax regime permanent, then we will grow if we deregulate, as we're planning to do. and if we reindustrialize. >> is that a precursor for saying we're not going to look at the numbers, or you're not going to look at the numbers

from from what the cbo says in terms of what the budget's going to look like. it may not look balanced according to their numbers, but it may be something that you guys say, forget it. we're not paying attention. >> to that. well, if someone were always wrong, would you look at the numbers? i mean, it is. i think they're a trillion and a half off in the last scoring. >> yeah. when you had your meeting with president zelensky and we've talked about this, i don't know whether you're treasury secretary state, i don't know. i think you're a little bit of all those things. and you've. >> got, you know, it's 100% treasury secretary. >> i know, but you were over there and i just want to get a feeling because. was that last friday? was that when that the. >> meeting. >> was. >> last friday? yeah. >> so we there have been disruptions in maybe the way we approach global trade and also maybe what our allies think of this in terms of, of security across europe, the russia-ukraine situation. i wanted to get your comments. did you think he was going to sign? were you under the impression that when you were there that

the deal was done and he was going to sign zelensky, zelensky? and did you were you treated badly? can you give us an idea of behind the scenes? what happened in that meeting or. >> in kyiv? >> yes. >> yeah. so i thought it was very important for, for me to go to kyiv and speak with president zelensky in person in his office. we had a vigorous discussion for 45 minutes or an hour. he did not want to sign the economic partnership agreement there. i explained to him that the purpose of the agreement was to bring the ukrainian people closer to the us, people that we wanted. part of president trump's peace plan was to show no daylight, no daylight between ukraine and the us. so he did not want he chose not to sign the deal that day. i asked him, i said, we're going to go out there. there are 50

reporters. what do you want to say? and he said, i am going to tell them that i will sign in munich, that he was meeting with vice president vance and secretary rubio. he didn't sign the deal in munich. so then the ukrainians requested to come to the white house and wanted to sign the deal. >> and what do you think was going on, though in his mind? i mean, do you think he was pushing this because. >> he thought he could. >> get a better deal? he thought that was punitive. what was he? >> i think he has this recursive loop of these two words security guarantee, security guarantee. and the security guarantee is twofold. one, that as the us has more of an economic stake in ukraine in the success of the future of ukraine, because i tell you like this deal, there is nothing for the us if the ukrainian economy doesn't succeed. so there's an economic, an implicit economic security guarantee. and prior to his

visit on friday, president trump had hosted president macron of france. prime minister starmer of uk. these were fantastic meetings. the european leadership, to the extent they are the european leadership, was on board with a plan for the europeans to provide troops on the ground, the security guarantee without americans, the american troops and the nato backstop starts at the polish border. and president zelensky kept pushing for this security guarantee. but i tell you, this was one of the most epic on goals in diplomatic history. all he all he had to do come in the white house, have a press conference. we were having a private lunch. if he wanted to try to renegotiate, that would have been the place to do it, not on worldwide tv. and then we were going to go sign the deal. >> and he says he'll sign it. now. where do things stand? >> well, he said he signed it. two other where do things stand.

>> is what's going on. >> behind the scenes. well, we're going to have to see the sequencing. sequencing was supposed to be an economic deal. and then again, move the ukrainians closer to the american people, get the confidence of the american people that their money is being spent wisely, and then go and negotiate in a stronger position with vladimir putin. so now, i think after president zelensky's performance last friday, we're going to have to see that he is in favor of a peace deal. >> can i ask you. >> a question? >> just about russia? and we were talking to michelle caruso-cabrera earlier. do you imagine over the next couple of years that american businesses will return to russia as part of. whatever ultimately happens here? >> and i again, the situation is very fluid and everyone is kind of jumping to the next thing that there is definitely a peace deal. president trump wants a peace deal. he is working hard and he's acknowledges that you have to speak to both sides. and

look, he's behind the scenes. he is negotiating just as hard with president putin. but you can't negotiate with him if you don't speak to him. >> given what happened with you in kyiv and then with what you said was going to happen in munich, i would think that maybe the president and the vice president, that didn't occur in a vacuum. what finally happened last friday, i mean, they knew full well what had been what had transpired at that point. does that explain maybe how things went sideways so quickly? >> no, i look. >> were you treated well in kyiv? i heard it was a dark room that that he was, i don't know, there was some arrogance that. >> but look, i think president zelensky understandably, is under a lot of pressure, a lot of pressure. because i can tell you in his office, the whole building is dark because. and there's sandbags in the building because they're afraid of a drone getting in in the building for security. yeah. so, i mean,

you think of a lot of security in times square and but he, i think has to acknowledge that the security guarantee is coming from the europeans. >> have you spoken to him since? >> sorry. >> have you spoken to him since president zelensky. >> when he when he came to the oval? sure. >> i mean, have you spoken to him since last friday? >> yeah. well, i don't speak with president zelensky and i have not been in touch with my counterpart, the finance minister. >> hundred percent. treasury, i think is although you just gave a pretty good summary of. >> all treasury all the time. >> of what went on, isn't being in business with ukraine in the middle business? isn't is there an implied security there? does russia not understand that there's an implied security arrangement there with the united states? >> joe. so it's not only a mineral deal, it's an energy deal, and it's an infrastructure deal. and my view of what what

are the russians think about this is so to get to kyiv, you fly to poland, take a ten hour night train. in that four hours before i arrived for the first time since november, the russians bomb kyiv. so i believe one person died. four were injured, including two children. and so i believe that that's what the russians think of this deal. they don't like it. >> yeah. >> let me ask you just a different question. maybe this is a political question or a philosophical question. there are some critics of what we're doing as it relates to minerals with ukraine who say, you know, what the work that the us has done with ukraine was done on behalf of democracy was done. >> as. >> a gift, that it wasn't a quid pro quo for some kind of economic situation, and it wasn't something that, you know, i don't know if i don't know if you believe that the terms of whatever the deal. >> are are too. >> tough on ukraine. but what do you say to those people who say,

you know what, we've gotten a benefit by supporting ukraine thus far, even without genuine economics this way. >> well, i would tell them to look look at the deal, which most people haven't seen, can't see yet. and let me tell you what the deal is not it's not one of these rapacious chinese deals where we come in, we don't have any mineral rights. we don't have any. this this is an economic development deal. so this is to the extent i've said a lot. i said in my speech at the economic club of new york yesterday, economic security is national security. we want to help ukrainians succeed economically. you know, poland, which sits next door to ukraine, poland and ukraine, when the iron curtain came down, had the same size economies. poland is three and a half or four times bigger now. and i'll tell you who doesn't like this deal is the ukrainian oligarchs, who tend to have their hand in the

till. so we want to make sure that the money goes to the ukrainian people. right. >> you've got to be able to talk about everything, scott. okay. bitcoin the reserve supposedly there was disappointment that we're not going to be buying bitcoin outright using taxpayer dollars. but if we can do it in a in a revenue neutral way, we would. number one. were you a proponent for the reserve? and two, is there a way to buy bitcoin, not just acquire it through? i don't know. however, we've gotten these $17 billion worth at this point. >> yeah. so joe, i am a big proponent of the us taking the worldwide lead in crypto. i think we have to bring it onshore and the use our best practices and regulation. i think that the bitcoin reserve, before you can accumulate it, you have to stop selling it. so what we have now is from a seized asset pool and i, i

wasn't there when it happened. but i believe what happened was about 500 million of bitcoin was seized, half of it was sold. and what we have now that, you know, say it's over 10,000,000,010, 12 billion. that's all through appreciation. so the first thing to do is to put is to stop the selling. so we are going to, you know, after the victims are paid and all of that, we will any seized assets will go into this reserve. and then we'll see what the way forward is for more acquisitions for the reserves. and we're starting with bitcoin. but it's an overall crypto reserve. >> so how do you think about buying though. and how should taxpayers think about that. because effectively. we'll be levering ourselves to some degree, given that we don't have a surplus of money right now to make these investments. yeah. >> so that's why the first step is to stop selling. and then

we're going to put a plan in place from there. so we're having this crypto summit i'm going back to washington this afternoon. and then we'll talk about the way forward. >> okay. can i just ask you about the irs? it's the largest bureau of the treasury department. and doj has come up with a plan to cut about half of the 90,000 workers there, about 45,000. the president was very clear this week that it's the secretaries who run the departments, not doge. i just wonder if you agree with a cut of that size, particularly when there have been points raised and studies done that suggest that for every dollar that the irs spends on enforcement and trying to go after bringing in revenue brings in about 5 to $12. >> yeah. i'm not sure where this cutting half the employees came from. what we did was there were 15,000 new employees. we did an evaluation. we kept about half. the ones that make it to your point, were deemed essential to

collections. somehow the other 7000 united states of america collected taxes for 250 years without them. and look, this is playoff season for us. that game day is april 15th, and i have three priorities with the irs the collections, privacy and customer service in that order. so there's nothing, nothing i'm going to do to hurt the collections over time. we are in the midst of this great ai boom, and i think increasing headcount now would be just the wrong tim, as the private corporations are moving into ai, and i can't think of a better application for ai than auditing auditing tax returns. >> how are tax returns this year? >> so far. >> we don't have the data about. the other thing too is when you ask about physical employees,

90% of the filings are now done online. yeah. >> i guess we started with tariffs. maybe we should we should maybe end with tariffs. and there's a piece in the journal today about the president's ability constitutionally to levy tariffs, and that he has invoked some emergency powers in the fentanyl case to do it. but the journal is basically questioning whether if you don't use fentanyl as a, as a reason that whether a us president can, can unilaterally levy tariffs. do you have a view on that? >> well, joe, if you want i could geek out for you. so the oh. yeah we love geeks. it's my it's my natural habitat. so we that what you're seeing now the tariffs based on the fentanyl at the border is something called iipa. that's an emergency statute. but there are 301 or

230 twos there. there's a whole range of actions. jameson greer just came in was confirmed last week as ustr. he has a lot of experience and deep knowledge of the legalities. i am sure that he will be by the book. i think that there were 4000 legal challenges to president trump's tariffs. last time. that was stood the test of time. so yes, it's not the administration doesn't have the ability to say let there be tariffs. but everything we do is based on a specific rule of law that we will invoke. >> every time you finish something. i'm thinking about something else that i want to ask you. i don't know where alex is, but can i ask, can we go a little bit longer? >> fun, really? >> all right, well, the show is over at nine. i don't know whether. >> i got to get to the crypto

summit. >> yeah, china. >> would you ever say that that we're ready for a trade war? we're ready for any kind of war. i thought that was a little bit strange to hear that coming from china. and i guess where i'm going is, in a perfect world, if we could be rivals in terms of business with china, but but loyal trading partners, or at least trading partners, it would benefit both countries. does the president want to get there eventually with china? >> well look i think he wants to get to fair, fair trading. and we're a long way off. and again, i will point to look how he has gotten the europeans to finally pay their fair share on the global defense budget for the western alliance. so can we. china needs to rebalance. so they have been exporting their economic practices to us. can we use tariffs to push back against

that and force a or encourage a rebalancing, which almost every economist believes needs to happen? and so the china relationship is very complicated because in the past, our economic partners, our biggest economic partners, were also our allies. we are now military rivals with china and economic rivals. so it's very tough to disaggregate that. so are they using their big surpluses to build up for this big military build up? but the answer is yes. could they tone down their military ambitions? maybe. but again, i like to stay in my economics lane, and there's a lot to do there in terms of to get to fair trade. and again, that i would say that anyone who is commenting on this doesn't

understand that these the surplus country, the surplus country is the one who will see the most problems in a trade war with the deficit country will do better. >> i don't know, you seem very comfortable talking about security and you and rubio. i think there should be like a hotline. >> what should what. >> should multinational companies who do business in china think so i know apple of course, is, you know, has a lot of business in china. they've now made a big pledge to do a lot of business in the us. but does that change the dynamic in terms of will they ultimately get a carve out on tariffs? there's lots of other businesses that that invariably do business in china as well. >> well, i, i know that apple is diversifying their supply chain. they've made a big push into india. we've seen vietnam pick up as a trading partner. so we're already seeing corporates take action. i'm on the record

as saying, i think the only good thing to have come out of covid was it was a test run for what could happen if we really got into a deep economic war or the unthinkable happened and we got into a kinetic war. so everyone has realized that optimal supply chains are not reliable supply chains. >> do you think that president xi will make a move on on taiwan? i asked. by the way, there was some very interesting comments by elon musk earlier this week where he even seemed to suggest that there was a relationship that, you know, maybe this would actually happen sooner than later. >> i follow president trump's lead, and he is confident that president xi will not make that move during his presidency. >> i want to add one more newsflash. i think we wanted, you know, that's what we live for. thank you for all the time that you gave us today, mr. secretary. >> thank you. good to see you. >> great to see you. >> come on back, please.

>> good. look forward to your book. >> thank you very, very much. coming up a lot more right here on squawk box. the countdown to the number of the morning. here we didn't get to talk about jobs, but we will because. >> the february jobs report is. >> out at 830 eastern time. stay tuned. you're watching squawk tuned. you're watching squawk box and this is (♪♪) (♪♪) what took you so long? i'm sorry, there was a long line at the thai place. you get the sauce i like? of course! you're the man! i wish. the future isn't scary. not investing in it is. nasdaq-100 innovators. one etf. before investing, carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com was such upkeep.

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by cnbc experts. sign up now for free. go to cnbc.com. slash spotlight. >> there's no put that. the trump call on the upside is if we have good policies then the markets will go up. >> that was treasury secretary scott bessent just moments ago when he was asked about the state of the markets. joining us right now is sara malik, who is chief investment officer and head of equities and fixed income at nuveen. sara, i take it that you were listening to what the treasury secretary had to say. what do you think coming out of that interview? >> well, markets are. >> skeptical that the use of tariffs. >> to. >> rebalance global trade. won't lead to either a growth scare or. >> a. >> re-acceleration of inflation. and that's why. >> you've seen the. s&p 500. >> gains since the election get completely. >> wiped out. >> and also international. >> markets are. >> outperforming the us. >> markets year to date. i think the catalyst. >> that we. >> need to see for. >> the s&p to find. >> solid footing is either. >> clearer signs. that economic

data is. >> strengthening and that. >> will either come from the. consumer or employment markets and from the consumer. we've seen. >> retail sales miss. >> we've seen companies. >> talking about. >> how the consumer is pulling. >> back and. >> then looking at. >> employment markets after january's. >> number, which was. >> fairly weak versus the prior. >> months, and. >> also. >> the fact that half of payroll creation since 2019 has. >> been government driven. >> i'm concerned today's payroll number will be closer to 100,000 rather than 200,000, and that we're going to see continued. >> signs that the employment. >> market is weakening. so i think this trend. >> of the us. remaining defensive. >> and european and asian. >> markets outperforming the us is likely. >> to continue for the. time being until we get. >> that economic clarity. >> so you don't sound like you're a buyer right now of us equities. >> i think it's tough for us equities because of the economic data that we're seeing and the fears over inflation. i get the argument that deregulation and tax cuts. >> could lead to. >> offsetting any. >> issues we see because of terrorists, but those are further out. right now we don't have clarity on those. and then, of course, there is this question about the fed. usually when tariffs come into place,

you do see a one time bump in inflation. will the fed look at that as transitory or will the fed react to that. >> is unclear. >> so all of that uncertainty in the us and the fact that we came into this year with the s&p. 500 at. >> about a. >> 20% premium to history, makes it tough. and let's not forget one more thing, which is the technology sector. 30% of the s&p 500 weighting tech stocks have suffered. and that also is leading to the us suffering versus the rest of the world. >> yeah, i guess in terms of inflation, in terms of the pain that the president has acknowledged, there could be some short term pain in some of these issues. i think the question becomes how long and how deep in terms of that pain. have you tried to put any of that into your figuring here? >> well, i think that's you. >> know, what's. unclear right now. >> if you look at market technicals, they're quite weak. you know earnings growth for the first quarter was up about 12%. year over year. so we have seen. strong earnings. but the outlooks are pretty murky at this point. and then i did mention technology stocks i think. >> that's another real. >> issue for the economy and the

markets. you know we did see broadcom report a positive number which is good. but i think that's very broadcom specific because of their custom chips and also. >> their non-ai business. >> but if you look at tech overall marvell nvidia we're seeing weakness there. and i think it's going to be challenging for the us to outperform when 30% of the s&p. >> benchmark is around. >> a. sector that's struggling. i think there's earnings downside. there's unfortunately some valuation compression issues for the us that could be ahead of us. so until. >> we see either that consumer start to reaccelerate. >> and come. >> back more. >> strongly, or. employment markets not show signs of initial cracking, it's going. >> to be. >> tough to find. >> the bottom for the us markets. >> six weeks ago, all you heard from executives, corporate executives was this idea of animal spirits. today when you talk to them, most of them will set aside uncertainty as the biggest factor that they're kind of focused on right now. and you might be able to pin that back to the tariffs. the on again, off again nature of these things, the uncertainty with what's going to happen. would you change your mind if there

was more certainty on the tariffs, if we knew exactly what the playbook looked like or if we said, never mind, we're not going to impose some of those. >> i think definitely. markets would. >> appreciate more certainty. >> here around tariffs. >> and also maybe some clarity from the fed in terms of how they may react to tariffs. >> but of course the fed may not. know that. >> yet until we see. >> sort of. >> some of. >> the impact. >> from the tariffs that. >> are coming into place. >> if you go back to the election, the. >> optimism around. >> the election was around the. tax cuts. >> and how. >> that would help the. >> consumer and deregulation. >> theoretically opening up the m&a market. >> unfortunately for the markets, we haven't. seen that yet. >> but what we have. >> seen is this. >> back and forth and this roller coaster. >> ride with tariffs, the back and forth. >> on. >> tariffs is creating uncertainty. and of course the. >> impact of those. >> does the consumer bear. the cost. does the producer bear bear the cost. how does the fed react. >> all of. >> that is becoming very unclear for the market. to price in. >> and that's. >> why. you're seeing so. >> much volatility. the s&p generally moving at least 1% a day over the past 6 or 7 days. all of that is the market's telling you they don't really know which way to go given this lack of clarity. so clarity would definitely help here.

>> and i. >> don't think. >> we're getting that at this point. >> sarah. >> thank you. thanks for having me. >> all right. coming up, a closer look at the market ahead of today's jobs report. the futures right now are mixed this morning. s&p still higher. nasdaq up a little. squawk box is coming right back. change in is coming right back. change in about -what've you got there, larry? -time machine. you gonna go back and see how the pyramids were built or something? nope. ellen and i want to go on vacation, so i'm going to go back to last week and buy a winning lottery ticket. -can i come? -only room for one. how am i getting home? sittin' on my lap like last time, ronald. fine, but i'm bringing this. [ whirring ] alright. or...you could try one of these savings options. the right money moves aren't as far-fetched as you think. there it is. see? told you it was going to all work out. thanks, future me.

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that's my secret to better odor control everywhere. >> welcome back to squawk box. >> shares of hp enterprise is plunging earnings matching estimates. revenue slightly higher than expected. but take a look at what's going on here. because the guidance for the current quarter and full year coming in below estimates the stock now off about 20%. just on the back of this news folks, the company saying it had higher than normal inventory for ai servers because. of a shift to next generation nvidia blackwell processors. as a result, the backlog for its ai systems was up 29% from the prior quarter. now, hp enterprise has already limited travel and discretionary

spending for workers and announced a cost cutting program involving layoffs of about 2500 employees over the next 18 months. it's about 5% of its workforce. and just one mention. i think about this a. >> lot because we're talking about. >> these nvidia processors and the and the like, and this goes to the idea of some of these build outs that are going on. a lot of these chips actually need to be upgraded constantly. so when people are talking about building out, you know, new data centers and the like, there's a question of just how long. i mean, you can keep, i guess, backfilling the data center. but this is a there's sort of an ongoing constant upgrade cycle that needs to be going on. >> it's expensive to. >> buy, it's expensive, it's expensive. and the company's ceo is going to join the team on money movers a little later today. that's going to happen at 11 a.m. a conversation. frankly, you really don't want to miss 20% off right now. >> coming up, automakers, one of the sectors making some big

moves this week. we'll take a closer look next. plus, don't miss our interview with robinhood ceo vlad tenev. coming up in just a few minutes. stay tuned. squawk box will be right back. >> this is the emirates premium economy seat. >> economy. >> perhaps they need to call it something else. >> for 32 years, red chip has been discovering tomorrow's blue chips today, with early research on starbucks, celsius, daktronics, winnebago and more. now we bring you red chat, an innovative ai solution which gives you answers in seconds.

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issues in mexico and the like, what's going on? >> absolutely. it's been a brutal week. we'll talk about tesla in a little bit. let me run through what these stocks have done not only over the last week, but over the last month, starting first off with the auto makers. and we're looking here at gm, ford, stellantis, you know, the story that the 25% tariff, it's on hold for usmca compliant vehicles. basically no tariffs for these guys at least through april 2nd in terms of the auto dealers. look, 23% of their sales come from vehicles that were built in mexico or canada so far. i should point out, we've checked with the industry. we have not seen an adjustment either in terms of pricing or incentives, though that is expected to change in terms of the auto suppliers. yesterday afternoon, they started to come back a little bit. first time we've seen a little bit of life for these stocks over the last week, week and a half. remember, they many of them have said they're going to have to pass along the tariff costs. and finally there is tesla. we've got two upgrades today or two notes about tesla.

first of all, td cowen has upgraded shares of tesla to a buy. wedbush dan ives he's on constantly. you know that he's a he's a perma bull when it comes to tesla right now. he has added tesla to its fresh ideas list. the bottom line with tesla is this guys there is a separation. there are the retail investors who have said, i believe in ai. i believe in autonomous vehicle technology. i believe in robotics. that's the future and i believe in elon musk. there are the headlines that tesla sales are slowing down. people are not crazy about the brand right now. and yes, that's weighing on shares of tesla. but now you're starting to see as these valuations come down, the bulls are going to start coming back out here. >> hey phil. >> can i ask really quickly? we've talked a lot this week about how uncertainty could lead to not just businesses slowing their their their their investing and their purchases, but consumers as well. and i think when you look around not knowing what prices are going to be, maybe that freezes things. i

do wonder, though, if a one month reprieve of this, these tariffs that could lead to higher prices almost instantaneously for car prices. if you've been thinking about buying a car, do you step up your purchase? does it pull forward purchases this month before things could get a lot more expensive? you pointed out earlier this week it could lead to an increase of about $9,000 for car and truck prices. >> absolutely. and i think there are a number of people, and i think dealers have heard this from some people. is now the time to pull the trigger? if i believe that my vehicle is going to cost 5000, $6,000 more come late april, may, whenever it might be, and yes, there's going to be some of that, but for the most part, there is still remains a little bit of a wait and see attitude, even with consumers in terms of are we really are we really going to see a 25% increase in vehicles that are built in mexico and canada? because that's i mean, you will see a definitive price increase and you will see incentives drop that. i mean, i don't think there's anybody in

the industry who does not believe that's going to happen. >> okay, phil, we're going to leave it there. appreciate it very, very much. >> 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. among today's top stories. treasury secretary scott bessent joining us earlier this morning on the set to talk about the president's plan to lower inflation. >> the biden administration created this bad equilibrium where the top 10% people, people in this room, probably most of the people watching this show, top 10% of americans are 40 or 50% of consumption. and that is an unstable equilibrium. the bottom 50% of working americans have gotten killed. we are trying to address that. we're trying to get rates down. and, you know, could we be seeing that the this economy that we

inherited starting to roll a bit? sure. and look, there's going to be a natural adjustment as we move away from public spending to private spending. the market and the economy have just become hooked. if we become addicted to this government spending and there's going to be a detox period. >> it's jobs friday. economists are expecting nonfarm payrolls to have increased by 170,000 jobs last month. we've got the numbers and the market reaction less than 30 minutes away, and a reported deal that we've been telling you about for several weeks is now official. sycamore partners is taking walgreens private for about $10 billion. sycamore will pay $11.45 a share. that represents a roughly 8% premium to yesterday's closing price, and you can see walgreens boots up by 6.25%. it's been higher on anticipation of that deal before it even happened. >> let's get to mike santoli at the nyse. hey mike.

>> hey joe. yeah. kind of an apprehensive market take going into the jobs number market for the last three days has been trying to make this 200 day moving average area around 5700 on the s&p count. you've got a bottom three days in a row around that area. it's not magic, but it does sometimes act as a little bit of a coming together of where longer term demand might kind of meet the short term selling about, i'd say 60% historically of five plus percent. pullbacks don't get to a 10% correction. so that people are thinking that if we get some reassurance, maybe on the jobs front, market does crave a little bit of a sense that the economy underneath everything else that's going on remains okay. not too dissimilar, by the way, from what we saw in late july, august, about a 6% drop in the s&p over a couple of weeks. then you got the extra push lower in that yen carry trade unwind. so you have to watch the currency markets and global capital markets for signs of, you know, cross-asset stress. take a look here at the dollar index as well

as the commodity etf commodity index really coming down and on a one year basis just about flat. i know treasury secretary bessett was talking about oil coming down. that's the dollar. that's commodities. and obviously that represents loosening of financial conditions, assuming it's not just because the economy is weakening. obviously, this idea of rebalancing around the world, europe, the euro soaring on that german fiscal move and spending on infrastructure and military spending kind of a good thing unless it sort of breaks something along the way with these really rapid currency and bond yield movements. finally, a couple of former bellwether areas of the economy and the stock market, semiconductors and homebuilders having it tough. although you do see this bounce attempt in the builders there recently. it's off the similar level that we got back in the summer. also, semis have been trying to make this sort of the floor of the range for a while right now. real kind of wrenching rotations within this market as momentum stocks have

really cracked and other stuff has not quite stepped in to pick up the slack. guys. >> okay. >> thanks, mike. >> when we come back. in just. >> a little bit, we. >> got reaction to our big interview with the treasury. secretary this morning, scott bessant from canada's minister of industry. we're going to talk tariffs, trade and much more. and then after the break, we're going to talk about president trump's executive order creating a strategic crypto reserve. robinhood ceo vlad tenev is going to join us before heading to the white house crypto summit. all that and more as summit. all that and more as squawk rolls on. (vo) a successful business owner sells his company and takes on a passion project with his son - restoring his father's jazz club, and in the process, revitalizes a community landmark.

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granger.com or stop by. granger for the ones who get it done. >> welcome back. >> to squawk box. >> president trump signing an. executive order to create a strategic bitcoin reserve. but cryptocurrencies falling as traders seem. >> to. >> disappointed with some of the details. in a post on x, the white house crypto czar david saxe saying the reserve will be funded exclusively with bitcoin seized in criminal and civil

forfeiture cases. he also said no bitcoin will be sold from the reserve reserve. >> treasury secretary. >> scott benson had this to say about the reserve just a short time ago. right here on squawk box. >> i am a big proponent of the us taking the worldwide lead in crypto. i think we have to bring it onshore and the use our best practices and regulation. i think that the bitcoin reserve, before you can accumulate it, you have to stop selling it. we're starting with bitcoin, but it's an overall crypto reserve. >> today the white. >> house hosting a digital asset summit. attendees include coinbase ceo brian armstrong, strategy ceo michael saylor, gemini co-founders tyler and cameron winklevoss. and our next guest as well. joining us right here first on cnbc is robinhood's co-founder and ceo vlad tenev. good morning to you. there was a lot of debate about this beforehand from the crypto community. also the tech community, when it was first floated that there would be a bitcoin reserve. and then just

last week, this idea that other coins would be involved in that, there was sort of a backlash to some of it. now, there's a different kind of backlash this morning saying maybe they didn't go far enough. what do you think? >> hey, andrew, good to be here. i actually. >> think this. >> is a sensible approach by the administration. i think that. >> you know, there's a. >> lot of debate. >> obviously, there are some people in. >> the industry that maybe. >> wanted, wanted more or. >> different assets, but i think this is an approach that. >> isn't terribly controversial. it's a good. >> place to start. and there's. >> a lot. >> of things that. >> we need to get done. >> i agree with secretary bessant that. >> the us. >> needs to. >> be a leader. >> in this new. burgeoning industry. >> and, you know, there's stablecoin. >> that needs to be figured out, market structure. prediction markets. >> so i think as an. >> industry, we have. >> to we have to join together, be. >> united and keep. >> pushing to make the us number one in this industry. >> vlad, do you believe ultimately that the us

government and therefore us taxpayers should be investing in and let's be honest, levering themselves up to buy additional bitcoin? >> i think. >> that the. >> us has to make. >> a determination. >> about why it needs various. cryptocurrencies and whether it. >> needs. them strategically. >> so i. >> think that having. >> some. >> clarity on. >> what happens in these cases. >> where there's. forfeiture or the. >> us government. somehow obtains. >> it, and. >> whether, you know, they're selling. >> it or. holding it. >> that clarity. is actually. useful to. >> the market. >> because you've seen in cases. >> like that that. >> the uncertainty. >> causes. >> causes fear. so i think this is a good place to start. >> now how far it. >> goes. i have sort. >> of less of a. >> strong opinion. i know, i know others.

>> there are other experts at the. >> summit on bitcoin, strategic acquisition and other things. >> i have two related questions. one is this is an executive order, and i wish i'd actually had the opportunity to ask the treasury secretary this. do you consider this an emergency? >> i'm not sure. >> i mean, i think. that there's various. >> various definitions. >> of what constitutes an. >> emergency. >> but what's. >> clear is the us. >> and this administration. is taking crypto leadership seriously and. >> acting. with a great sense. >> of urgency. and i think this summit that they're holding. >> today at the white house is. >> a great example. >> of that. >> i mean, certainly the administration's moving fast, governments moving fast. but i think rapid change is necessary if we're going to maintain us leadership in what's an increasingly uncertain world.

>> 4440. >> to be honest, we unfortunately switched topics at one point. >> and then. from that we could have gone. >> and i wanted i. >> wanted the. >> very end. you had the last two when they were, they were jumping up and down. there were a couple other things that i was hoping to. hey, vlad. vlad, did you see? i mean, some people think all companies should have a treasury filled with with bitcoin. does that would that could you ever see that being something that the united states would be and it would probably be taxpayer money. but if it's going to a million, wouldn't that help in a lot of different ways for, for treasury to have that reserve? >> well, i think that you get into the general question. of should. >> the. >> u.s. be investing its money once you expand beyond bitcoin into. >> all sorts of other. >> assets and potentially securities, and many countries. >> have a sovereign. >> wealth by. >> gold. >> many, many countries. >> have a sovereign. >> wealth fund, which were also

also instituting. >> so i don't. >> think that's. >> a no not. unreasonable. >> right. hey, vlad, not only are we potentially buying bitcoin in the future, but these other coins as well. and i'm curious how you think about that. i'm also curious how you think about the fact that so many members of the administration are invested in crypto themselves and that inherent conflict that i think is very visible to those who want to see it. >> well. >> from from. >> what i've seen, i think. that everyone's aware of that concern. and most people that i've talked to have taken steps to actually make. sure that they're not conflicted by, you know, selling their exposure or otherwise making sure they're they're disinterested. i know there's been a lot of conversation about that. i think a lot of a lot of people in the

administration are joining because they really see an opportunity to help and put their talents in making our country and our government work better, and i'm excited to see them. they're moving incredibly fast. but but i think it's necessary. >> there's a headline that says that the nasdaq, which of course is the home of where we are right now, joining the exchanges, seeking to offer round the clock trading. this is something that i think you've been a proponent of. where do you think that stands right now? >> i think that it's the future. i think especially when you talk about other assets like cryptocurrencies trading 24 over seven around the clock with native fractionalization. so you can buy any amounts of these assets. it's a little bit silly to think that the us markets are tied to, you know, east coast working hours. and what we've seen we've been we've been early in offering a product called 24 hour market to our customers.

it's extremely useful for customers to be able to see what's going to happen before monday. market open. so 24 hour market opens on sunday, and it's turning into a critical piece for risk management. you know, if you have if you're able to manage your positions, hedge risk on sunday evening ahead of monday open then that's something that, you know, you would feel like you're at a disadvantage using any other platform. and i think that's true for the markets in general. so i'm excited to see more progress in making that a standard. >> hey, vlad, before you go, i know you're off to this crypto summit. what are you hoping to learn? meaning, what are the questions that are on the top of your mind about how this is all going to work? >> yeah, yeah, i that's a great question. i think there's a couple of things that need to be done to establish us leadership across this, this burgeoning industry, beyond just the

question of the strategic reserve. there's a stablecoin bill that people are working very hard on. and i think there's consensus that that's going to be the first step. and then once we go beyond stablecoin, the interesting question, the one that i care most about is tokenization. so how can we list crypto assets, securities. what qualifies as a security versus a commodity? how do we deal with crypto prediction markets and other derivatives? i think that's all contemplated to be part of a broader market structure initiative. and, you know, if those can get done in the next few months, i think that will be a great success for the industry here in the us. >> vlad, i want to thank you for joining us. good luck at the summit later, and we hope to talk to you again about all. >> of it. thanks, guys. >> very soon. thanks. >> all right. up next, the latest twist on tariffs and reaction to treasury secretary scott besant's comments. earlier in the show, canada's minister of industry will join us right after this break. and the

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do is based on a specific rule of law that we will invoke. >> that was treasury secretary scott bessent right here on squawk box earlier in the program. joining us right now is canadian industry minister francois-philippe champagne. he is the country's equivalent of the commerce secretary here in the united states. and minister, thank you for being with us this morning. i'm trying to follow what's been happening with tariffs has been a little difficult, even for those of us who do this for a living. why

don't you bring us up to speed on the latest in terms of where things stand right now between canada and the united states on these tariffs? >> well, first of all, thank you for having me. it's a real pleasure. i would agree with you. i think there's like policy fatigue. >> you know. >> that you're seeing now. >> the markets have spoken. workers have spoken. >> industry has spoken. you know i've been. talking to u.s. ceos. >> and you know what? we cannot. >> allow uncertainty. >> to become the new certainty. you know, we. have to work on it. and we need to work between canada and the united. >> states to remain very competitive. because that's the. >> best way to achieve the plan. >> that was set up. >> i was at. >> the inauguration. >> i was at the. >> emancipation hall. >> during the inauguration. i remember when the president talk about the. >> golden age. >> of america. >> you know, i was saying, well, if it's good. >> for america, it's going to be good. >> for canada, because, by the way. >> i'm always. reminding becky when i go to. washington that canada is the biggest customer to the united states, we buy more from the us. >> than china. >> japan, the uk and.

>> france combined. and you know where i come. >> from, when you're the. >> biggest customer, you. know you're treated well. because that's how we are. >> we've been integrated our economy. so what we want is. obviously for these tariffs. >> to go away. >> and to make. sure that we can work together with the administration. >> we're ready to do our share. >> we've done it on the. >> border on fentanyl. >> we want. >> no fentanyl on our streets. we want to control immigration. and you know what? that's why. you've seen so. >> much going. >> on in the market. that's uncertainty is not. >> helping industry. >> it's not helping our workers. >> and certainly. >> it's not helping to. >> make north america more competitive. >> do you have a clear idea of what it is you need to do to keep these tariffs from being implemented next month? >> well, it seems that that's a. >> very good question. it seems that the. >> goalposts keep. >> moving and that's what makes it difficult. you know, i was secretary of state for canada during the first. >> trump administration. i've been there. >> i've been working with the

administration. but what. >> we had. >> at the time, we had a process, we had negotiators, we had issues that we could discuss. you know, we're the best friends. we're the best allies. we're the best partners. we depend on each other when. >> it comes to energy. >> critical minerals, semiconductors. >> so i. >> just think that we need to get. >> back to. >> a place of normalcy in our relationship between canada, the united states. >> because you know what? today, economic security. >> is national security. when you talk. >> about aluminum. and i heard in. >> the state of the union. >> address. >> the president talked about shipbuilding. >> that's very important. >> to make. >> sure that we. we can face our adversaries. >> and i. >> always say canada is. >> not a problem. canada is part of the solution. we need to work together to protect our economy. >> and. >> you know, the challenges coming. >> from china. so when i hear. >> secretary besson. >> i would agree with him. >> i have been preventing a number of chinese investments. >> to protect our. national security. >> to protect. our critical.

>> supply chain. and i think we should be seen like that. >> you know. >> we deserve credit for. >> what. >> we've been doing. >> to protect that. >> it's good for. >> canada. >> but it's also good for our american partners. >> you said that you've done the work. you think that needs to be done when it comes to fentanyl, when it comes to immigration, protecting the borders, does this feel to you like there's going to be a renegotiation of the usmca that was signed to put into law under the first trump administration? >> yeah, that's a. good point. >> i mean. >> president trump signed. >> the usmca, and therefore, if he wants to, there's a process for review. and we've said we're we're we're willing to engage with with the administration on that. what we need is stability and predictability on both sides of the border. you know, when. >> you're talking. >> for example, in the. >> auto sector, those are very long supply chain. >> you cannot change the. rules from day to day. >> or week to week. we need to. >> have. >> that predictability. >> so that we are more competitive together. we are more innovative.

>> together. >> and we can sell more of our goods across the ocean to the world. that's really what it is for us. >> so i am very keen. >> to engage with the administration. we've been doing that, you know, for ten years. i've been engaging with the administration on. different in different roles. and i can tell you the world is watching us as well. the world is. watching how we're going to be able to solve those differences and to work together. and i think we can bring great things, whether it's on the energy. >> side. >> nuclear energy, that we can work together, critical minerals, you know, we. have a. lot to offer to the world. and the best way to do it is to do it together. >> the president, though president trump has been pretty clear that he would like to reset things, that he wants to see fair trade, he would like to see some of those plants that are in places like canada and mexico, moved back to the united states. is that a starting point for a negotiation with you all? >> well, i would say. >> there's a good reason why these plants are on both sides

of the border, because that's what makes us more competitive. canada is the largest supplier of aluminum to the united states. and there's good reason, because not only we have the workers, but we have the energy to make sure that we have the most competitive price. same thing when it comes to steel. if you. >> look at. >> the steel producers. and becky, i've been in touch with a number of ceos. they have assets on both sides of the border. the point is that we have an integrated economy. and if you exclude energy, actually the united states has a surplus with canada. so that's you know, you need to get back to the facts and make sure that. the political discourse is matching the industrial reality. the reality is that we are joined up together when it comes to energy, when it comes to natural resources, to manufacturing. and it'd be really a. shame that that we put behind us decades of good work we've been doing together. i meet as many u.s. ceos as canadian ceos and becky. >> they have. >> assets on both sides. they don't understand. and people say, you know, tariff on canada

is a tax on american. it means that, you know, people who want to buy a pickup truck will have to pay more. it means that people will pay more at the grocery store. it means that people will pay more for gas. >> we don't want that. >> we want to work together. we want to do more together. and that's what we've been working on with the administration. and i hope we can get. >> back to a. >> place where we can discuss issues together. and, you know, i've. been said there cannot be tariffs without consequences. they cannot be. >> tariff. >> without impact, and there cannot be tariff with. higher prices for american consumers. so let's get back to the. >> table and. >> make sure that we do things together, as we have always. done to protect north america. >> minister champagne, thank you for joining us today. >> always a pleasure. >> thank you very much. >> thank you. up next, the jobs report. our panel is standing by with predictions and reactions to the numbers. squawk box will be back in 30s.

>> machine learning is advancing, but. >> businesses wonder if some. >> machines can. >> keep up. >> let's welcome our new. >> coworker, jeff. copier has a great idea. >> i wonder if it's the same. >> idea as yesterday. >> it's a performance issue. really. i know people. >> push your. >> buttons, but you still have to deliver. >> anything can change the world of work. adp assist is i informed by workplace data and designed. >> for the next anything. >> we are just seconds away. about a half minute from the february employment report. the futures have been mostly flat for most of the morning. waiting. the big number s&p, is unchanged. dow is off a little bit in the nasdaq just a little bit higher. rick santelli is

waiting in the wings standing by at the cme in chicago. you want to give us your estimate rick. >> yeah i think we're going to be somewhere in the 150 to 180 camp. we're looking for a number kind of 160 or so. i'm right in line with expectations after adp. it seems many were a bit nervous that this number was 151,150 1000 is our february. read on the creation of nonfarm jobs with a slight revision from last month from 143 to 125. and if you look at the combined two month revision, it turns out to be -2000. now let's go to the unemployment rate, shall we? known as u3 4.1, it moves up from 4.0. it equals where we were in d of last year. to find a higher number, you go to november of 24 when it was 4.2.

now average hourly earnings come in here on a month over month basis at up 3/10 as expected. and that does follow that wild jump that we saw up half of 1%, which was the strongest month over month number since january of 22. now if we look at point three that equals where we finished 2024. if you take a year over year perspective, also a bit less 4% 4.0. that's one tenth less than expected, one tenth less than the rear view mirror. it equals actually 4.0. the last number we had that would be equal or less than would be september of last year when it was 3.9. if we look at our workweek and this is what distorted earnings last month, in my opinion, the work week last week came in at 34.1. get this. we've been keeping track of the average weekly hours since march of 2006. this

number, at 34.1 was the lowest. the smallest since march of 2010, march of 2010, and we remain at that level. now. let's go to the u6. that's the underemployment rate that comes in at 8%, a huge jump from 7.5 to 8%. to find a higher number than that, you're back to october of 21 when it was 8.2. and finally, labor force participation rate moving in the wrong direction, 62.4, down from 62.6 62.4 equals where we were in january of 23. to find a smaller number, you're going to die of 22 after all that is over. interest rates have moved up just a smidge. pre-opening equities are moving up a bit as well. the numbers are not nearly as dire. they're fairly close to expectations. and i think that

workweek it caused a little volatility on its adjustment to some of those earnings numbers. and real quickly, you know the treasury secretary this morning hit on what many of my sources and i discuss. and that is the notion of private sector versus public sector when it comes to spending and growth. how many economists have you heard from joe and the gang that say our fiscal path is unsustainable? well, there's a lot of growth associated with that unsustainable debt ridden path. and i think as we try to address that, the obvious is going to occur. we're going to lose some of that growth. but think about it, it's unsustainable to pay for it in the way we have been. back to the panel. >> all right. thanks, rick. steve liesman is here. so steve, i do i look at this as a the world is still sort of the same as it was and didn't fall off a cliff. or is it is it sort of at me enough to allow for cuts this

year? why why the why the jump in equity prices immediately? >> i think we feel like maybe we dodged a little bit of a bullet. i like the first comment you made. it feels like things are kind of sort of the same as they were. and you had a nice upgrade. >> people really thought that fear of what's coming could have caused people not to hire. >> yeah. >> joe, i'm going to give you a little background on this. one of the best things i ever did for the front page of the wall street journal was write a story about how consumer sentiment is not a good indicator of consumer purchases. many years ago, in the year 2000, i think that was which is what, 24 years, 2000 hiring in the wake of nine over 11. and so look what's happening in washington, which, by the way, makes the treasury secretary's appearance here all the more important. how kind of calm and stabilizing and cogent he was with all of his answers. if i might editorialize for a minute. there's a lot of concern out there, a lot of turmoil, a lot of chaos. you come in one day and things are are tariffs are on, tariffs are off. tariffs are partly on tariffs partly

off. you don't know what's going on. people are desperate for a little stability out there. and so this number comes in and it shows you know what whatever happened in the period leading up to the date the cut off date, which was the 12th was okay, was. >> okay, but didn't most of the government job cuts come after that? >> it's all after that. and what we're going to learn is the importance of this stability in washington when it comes to policy to private sector hiring. we're going to learn and we're learning. i was talking to our next guest on this, joe lavorgna, about this. how much government spending matters inside, not just the government sector, but the private sector as well. there was a minus ten k on federal employment. okay. a lot of the of the private sector jobs were in education and health services. about half of the private sector jobs. there's some changes in spending there. so it's a good stop or take off point when it comes to where

we're going. but there's still a lot of uncertainty in the future. >> yeah. >> everything's reversed itself. hey, joe, how are you? let's let's get to the rest of our panel. joe lavorgna is here, chief economist at smbc nikko securities america. jason furman, harvard kennedy school professor. our own mike santoli is at the new york stock exchange. let's start with you, joe. so what do you make i think the yeah. >> the numbers. >> are okay. they're not bad. but you know, steve was talking about, you know, the chaos, which is an overused term. and i would say what the administration is doing on tariffs makes a whole lot of sense because it's the chaos with the quotes. is not a it's not a bug, it's a feature. and it's making the market more immune and numb. to what will happen in a way. that the markets. >> can adjust. >> so ultimately, when the debate with china takes on more ferocity and intensity, will it prep the markets for everything? you hit your head against a wall because it feels so good when you stop? >> no. >> i. >> didn't say that. no. kind of what you said. no, because the

markets need to adjust in a way that they can. not totally fall apart. and you have to sort of put it out and then take it back, put it out and take it back. that's how i. >> see it. >> there was a. >> lot of. >> criticism with malaysia and argentina. and look, a year later, look how wonderful the improvements have been there. notice he was one of the first people to come visit the president on inauguration chaos. jason, i guess i called it a little bit. steve. i referred to it to the treasury secretary as somewhat haphazard. some of the critics would say, about putting tariffs, taking them off seat of the pants. jason. but we just heard from joe that that prepares you for the next round of chaos, and you won't be nearly as worried. >> i think that's. >> a little nuts. >> the idea is we're going to lower the market. >> by 10% now. >> so that when. >> we do something. >> later. >> it doesn't. >> lower the market. >> i just don't get it at all. >> i don't think we should. >> be trying to rationalize. >> putting big tariffs. on taking them off big ones, on

partially taking. them off. threatening them on multiple dates. >> i don't think there's a strategy here. i don't think there's a good rationale here. and what's been. really surprising. >> to me. >> is how blasé. >> the administration. >> has. >> been about the central issue that got them elected in the first place, which was the cost that americans are paying. >> they're being. >> remarkably, remarkably. >> jason, we were we went up to 9% and the cumulative inflation was 25%. what are you talking about? a couple of tenths of a percent of disappointment on the on the recent cpi and ppi. what eggs? >> joe i. >> was a critic. >> i was a critic. >> of. >> that legislation. >> i know but but. we don't know. inflation has come back. we don't know. inflation is roaring right now. >> for a couple tenths says you're indifferent to inflation. >> you know the. >> inflation rate. >> right now. >> is running. >> at. >> about 2.5%. >> underlying inflation. >> add 5/10 to that. >> you're at three. what's the difference. >> between two and a half. >> why are you jumping. >> have we. >> added 5/10 yet. >> we haven't added 5/10 yet. it hasn't happened yet. >> wait for it to happen. the

way you get creeping. >> inflation is you start saying. >> you know one tenths here, one tenth there, who cares because you're at. 3% inflation, are. >> jonesing for some inflation. so you can say it wasn't by default. it is. >> i think it's happened. wait till it happens. every ten matters joe. every time. wait till. >> it happens. >> we just. >> tariffs are not inflationary. i don't understand why everybody thinks that's the case. if the money stock is unchanged and tariffs by definition cannot be inflationary. inflation is always and everywhere a monetary phenomenon. >> and a. >> caveat if we add the word. credit because we've. >> got. >> private credit is only true if other prices are falling. if you. >> engineer other questions then that's. >> the whole other. >> prices go down. >> that is the. >> point though. so to get those prices. >> down, that. >> is the whole point. >> though if activity. >> first of all. >> if you have a price level in. >> activity then it won't cause inflation. >> i agree with that. >> if we have a price level adjustment, other prices yes should fall over time. however, if we go back. >> and look at. >> 18, what. >> we saw. >> is the exchange rate. >> offset, a lot.

>> of it. and when mexican tariffs were announced, the peso. fell 17%. >> and in. >> the case of china back in 18 they absorbed it in the margin. >> hey rick. >> yeah. and yada yada yada. >> the manufacturing sector went into recession. >> let me get. >> to half of it. >> hey. >> rick, by the way, will hurt american manufacturing. i'm talking about hey, rick. >> rick, if. >> you know democrats. >> eggs. >> eggs, eggs. what about energy? what about oil? what about i mean, all you got is eggs at this point, jason. i mean, wait for it to happen before you go ahead. rick. >> oh, i, i don't want to. i want to warn people about policies that will. >> worsen. >> the. >> economy's structural issues were created in the last administration on a number of fronts that are going to be very difficult to extract. and many of those structural issues have been causing inflation, whether it was spending fueled by debt creation, whether it was energy policy fueled by insanity and all that will extract a temporary price, there is nothing for free here. when you

complain about all the programs that were enacted after and during covid that were crazy big, well, to reverse them that we paid for our growth, but we paid for it mostly with debt. this is not going to be pretty. it's not going to be easy. but if our panel discussion is anything, it's a bit depressing because if we can't take some volatility in a damn stock market to get our fiscal house in order for our kids and our grandkids, what comes next. >> it's unnecessary. >> volatility is getting our fiscal. >> house in order. >> that's what's. >> volatility here. tariffs go up. tariffs go down. tariffs go up. >> tariffs go down. >> well tariffs. they've been threatened. >> they haven't even been inputted yet. >> problems i've written about them extensively. >> they haven't even been inputted yet. >> they got arabs. they got eggs. so. >> but steve. >> but but. >> you raise a very. >> interesting point about the volatility. >> like markets are. supposed to be volatile. >> this happens. >> i don't understand what the. >> and if. >> you want to. >> be disruptive. >> and you want to make real

fundamental change, things are going to. get broken. and i think the. administration certainly is willing to break things. >> i'm sorry joe, i reject that without having any issue at all with the objectives of the administration. i've been covering economic policy from administrations for several decades now. when they have a plan, they call you in, they give you a briefing book, they give you a series of estimates. they've thought it through this administration, it appears to me, did not talk to the car companies until three days after the tariffs were put in place. so you can do this better? i can do this better. the administration can do this better. >> can i say one thing. >> to you, steve? october. in september he said he was going to do this. what do you need to call. >> that's different. >> they say 1.5%. >> on canada. >> and mexico. >> but wait. >> wait, i came. >> here before the election. >> steve. >> does anybody know even what happened here? i mean, we worked one sunday. they were going to put tariffs on. he decided not to do it on the monday. and then

he said there was going to be tariffs. and then he put them on. and then he took them partially off. and then he took them off according to some other metric of those who follow the usmca, if you want to do tariffs, do tariffs. but it's like the gang that couldn't tariffs. >> suddenly that caused all this inflation. jason was talking about no tariffs. >> joe. that's a different. >> story steve. >> you talked about all. >> the. >> briefinghe >> briefing books. >> and all. things that you've gotten from people in the past. how successful were all those administrations? >> sometimes they're very successful, sometimes they're not. >> but in terms of the waste, abuse and fraud, and this is a part this is a bipartisan issue. bill clinton talked about it, george bush talked about it. none of it ever got done. >> so this. >> is. >> clinton did. >> some. >> very little. >> i'm not i'm not blaming him. i'm not making this a partizan issue. i'm saying. that we need to make some serious structural changes. as rick mentioned, it's going to be. >> messy. >> but for the greater good. >> let me respond about messiness. let me respond. >> just judge the policy 1836 months from now. let's not do it in real time. >> i sat, i sat in a three hour

seminar about deregulation during the trump administration so that you at home didn't have to. okay. and let me tell you, deregulation is very hard. it's a very important thing for, for the markets. they really like this idea about 70 or 80% of the court and legal challenges of the first trump administration were lost by the administration. there was hope among those who are proponents of the deregulation that he would do better this time. but where are we, joe? we're in the courts on doge if he wants to reduce the waste and fraud and abuse of the administration, let him go through a process that doesn't create this kind of chaos in the courts. it's already happening. he's losing in the courts. >> hold on. >> take over. >> hey, hey! >> rick! in the courts. >> rick, rick. >> rick, the democrats have decided that, you know, they kind of feel like they're out in the wilderness, that if they lost because of inflation, if they can harp on inflation and

that we still and it's worse than it was and it's still happening. and eggs are $10. and you said you were going to lower them on it. it's just a it's almost a talking point that they decided is the strategy that they're going to employ to counter whatever is happening right now. and but do we know yet that any of this inflation has been caused since january 20th? >> of course it hasn't been. no. >> what we are doing is we have gotten a much stronger magnifying glass since then, and we look at things the way we should have been looking at them for the last 8 or 10. >> years. >> because the seeds of inflation have been planted a long time ago. >> joe, the inflation. >> we have now is some combination of the fed. >> joe biden and global circumstances. >> it is not donald trump's inflation, but he needs. >> to look. >> ahead and. >> say with. inflation already highs. >> oh, santoli. >> is what i'm saying to it even a few tenths. or does he want to be. >> subtracted from it? >> i'm sorry.

>> mike, so nice. subtract from it. >> you know mike do you want to talk or. i mean you can get credit for being on the panel. you don't if you don't. yeah. >> no, i'm going to punch my ticket either way. but i think what i would love to do is kind of kind of give some kind of way of channeling how the, how the market's looking at this, which is, you know, all well and good. it seems like there's no ability to know, am i lowering earnings estimates for these companies that are tariff exposed or just kind of have to deal with this extra friction or not? now i think the market wanted, as i said, a half hour ago or so, reassurance that the labor market was in a somewhat steady state going into all this. it more or less got that in the second in the second week of february. i also think it's worth keeping in mind that public sector employment in aggregate, like 8 or 9 times as many people work for state and local and nonfederal as federal. so it's not like that's where the, the, the mass of jobs are. that's where the money is, frankly, in terms of the fiscal situation, what i think the market is saying is, look, we

went down 400 s&p points in two and a half weeks, and we bounced 15 on the headline number. and so it's totally unresolved. and we're unwilling to extrapolate what we got in this report into the future. you know is it going to be pain before gain? i think that's what the market is struggling with. treasury secretary bessant, you know, he continues to sound like he's willing to accept a little bit of slack in this economy or maybe more than a little bit. and the market has to figure that out. >> all right. who wants to argue with steve? joe, do you want to rick. do you who wants both of you want to want to go? who wants to start? >> i'll debate. i don't argue, i'll debate anybody. >> all right. >> do you want to start or do. surprised raise your hand. >> so again. >> my point. >> is. >> i just think. >> this is pretty easy. >> to get. >> one point across to fix, to fix what's wrong with our country, to get our fiscal house in order. there's no easy way to do it, steve. you can't use 30 years of past rule books. you got to tear them up because we've been on this path ever

since we let china into the world trade organization. >> i'm in favor of using 250 years of the rule book of the constitution that gives the congress power to spend, that gives the congress that gives civil service protections. joe. >> separation of powers. the courts have been wrong. they're going to get on track. >> well, right now, the courts are the ones who are stopping this process. and if you're in favor of getting rid of waste, fraud and abuse, you ought to be on board of a legal process. that isn't. >> when it. >> comes to the supreme court. >> it's going to go to the. >> supreme court. >> and trump supreme court. >> turned him down. >> rick. >> unrelated, but i think it. >> speaks to. >> this issue. >> which is do it in a in a permanent way. >> we've been talking. >> about the bitcoin reserve today. right. that's being. >> brought together. >> by an executive order. what is the demonstrable emergency that you can actually think about that would require an executive order for the creation of a bitcoin reserve. honestly. and i asked that not because i'm against the bitcoin reserve, but

because ultimately i think the courts are going to look at a lot of these executive orders and say, by the way, this is not just biden didn't use executive orders inappropriately either, but nonetheless, i disagree and just say. >> i could care less about a bitcoin reserve. okay? i care about $38 trillion. that's just a pimple on the hippopotamus rear end. okay, we there's not there's a lot of executive orders i don't agree with. i would like congress to do their job. the problem is they don't. >> right. >> i agree with that. by the. >> way. >> can i just. >> can i just. >> measures are the highest they've been. >> in. >> decades has nothing to do with deficit reduction. it has everything to do with these tariffs going on tariffs going on tariff going on tariffs going off. that's not going to help growth. that's not going to help. >> us solve our. >> fiscal problem. >> so rick. >> can i just. bring joe. jason i want to get beyond this this argument here. joe. >> the tariffs. >> on and off. >> are hurting not helping. >> joe i want i want you to give us i read you every, every day

and i think your economic commentary is outstanding. people ought to be reading joe and his partner troy, give us an idea of your outlook here for growth, the atlanta gdp thing. we all are smart enough to throw it out, right? what are you looking for the first quarter? and give us an idea going beyond. >> we're bullish on growth. we think 3% gdp this year. >> could be. >> slightly better because of the productivity trend, which is continuing. jason's point about a product of uncertainty is correct. there's a lot of uncertainty. but my pushback to that would be business confidence. small business confidence is still extraordinarily high. much, steve, will depend honestly on what happens with this tax bill the longer we go into this year. and if you look at uncertainty, i don't think it's the tariffs so much as it is the tax policy. and you see that in the uncertainty index. when you look at fiscal and tax issues. as basically being at levels we've never seen before, we need the tax bill. steve. if we get the. tax bill then i think and get it soon we could have 3% growth. and if we can get energy costs down, and i'm very optimistic.

we were at $8 per barrel in january. we were at 65 the other day. we could get under 60, which i think we can do. we can get inflation down. so we're pretty optimistic. but there is a there are big tails skewed to the positive, but there are. >> fat tails. >> a lot of broccoli, not a lot of steak is rehat we've had so far from the administration. >> all right. now i'm i'm even more tired. thank you. joe lavorgna steve liesman everybody. mike santoli well this is jason jason and rick santelli. mike santoli. >> we're going to bring in roger ferguson to this conversation right now. former federal reserve vice chair, cnbc contributor your first reaction to these numbers and perhaps the way you think both the white house could react, since that's now a sort of new component to this, but then also how jay powell may react. >> so i think these. >> numbers are a. >> bit of a relief. >> and as the panel has been. >> saying in that they reflect. >> a certain kind of normality. >> you know, a little bit of softness perhaps on some. >> of. >> the unemployment numbers.

>> but i think nothing to worry about. you know, i think the white. >> house. >> if they were wise, would say. >> you know. >> the unemployment rate is still roughly at full employment. >> the numbers. >> don't look like. >> they're feeding into inflation. so a check for them, i think from jay. >> powell a little bit of the. >> same. >> you know. >> worried about the economy softening. this doesn't necessarily suggest that just yet. but nor does it suggest that the average hourly earnings are going to be driving inflation. so i think for everybody this is a you know so far so. good relief kind. >> of number. >> but much more to come given the kinds of uncertainties. and policy moves that we're waiting to see. >> well. >> that's what i wanted to ask you, roger, though, which is the uncertainty, is that steve liesman was just reflecting. when you start to think about what were the kinds of numbers you think we'll see next month and the month after, what does that tend? >> look. >> i think we're definitely going to see a. higher unemployment rate. i think the obviously the. >> federal job. >> numbers is going to. >> go. >> down, which. >> will have some impact. >> on government numbers overall. >> but i. >> think this has got to be one

of many numbers to look. at. because the. >> labor force out of. >> washington, d.c. >> is somewhat, he pointed out, is not. >> really. a thing that. >> drives the economy. >> i think. >> they're much bigger issues. so this number will be one that. >> feeds into. >> the broader context. >> of, you. >> know. >> is the economy slowing? there's some. >> concern in the. >> beige book. >> of that. >> you know. >> we see. >> some risk. >> of inflation expectations getting higher. so i think right now we're on the precipice of. >> trying to. >> decide which way all of this is going. >> you know. >> hopefully better growth and. >> lower. >> inflation but. >> not. >> yet certain. and obviously. >> some of the things that the administration might do could exacerbate both sides of that question. >> you know. >> we could have higher inflation from tariffs. and at the same time have terrorists slow down critical sectors. >> so i think at this. >> stage it's a wait and see. >> and it will unfold. >> and now i think we'll resolve some of the kerfuffle that you just had on the panel. >> let me throw one other ingredient into that stew, which

is at some point, we're going to have a big debate in this country over taxes. i you know, i imagine it may even start before the summer in earnest. how does that relate to the uncertainty that you're describing? >> look, i. >> think it. >> plays into the big. >> fiscal question. so, you know, a lot of focus on getting our fiscal house in order. i think what they're going to discover is it's hard to do that with just one side of the equation. i think it's going to be hard to get the fiscal house in order, focusing just on current expenditures. we are going to have to think about new funding, new revenue. i don't think tariffs are going. >> to. generate as. >> much revenue as the trump administration hopes. and so i think taxes on corporations and individuals. are definitely going to. have to be on the table more than the administration. wants to. >> admit in. >> order to get the fiscal balance. not consistent with their headline message. >> but i. >> think the reality is going to. eventually confront everyone. >> that we can't leave taxes. >> off the table. and think that

we're going to cut the federal government and raise tariffs enough to. >> deal. >> with the imbalances. >> that we've had. >> great. >> roger ferguson, thank you for your instant analysis. we'll talk to you soon. >> thank you. >> up next, we'll get a look at what's moving in the market in the premarket this morning. and make sure you catch white house trade adviser peter navarro. that's this morning on squawk on the street. he's got reaction to the jobs report. squawk box will the jobs report. squawk box will be right back. got eyelid itching, crusties and swelling that won't go away? it could be... demodex blepharitis! and we're demodex mites. we're very common and super irritating to your eyelids... but we love making ourselves comfortable here! (♪♪) oh yeah... steam time! if demodex mites are partying it up on your eyelids... it's time to eliminate the root of the problem with xdemvy. with one drop in each eye

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ads.com. >> all right. the futures have bounced around a lot this morning. right now it looks like the dow futures are off by about 65 points s&p futures down by four. the nasdaq indicated up by just about five and a half. let's get over to dom chu. he's got a look at the morning's pre market movers. and dom i guess you should be looking at this morning. and then kind of thinking what we've seen over the course of the week. >> sure. >> and just to kind of give you an idea let's frame this around the intraday action if you will, around that. so if you take a look at the way that futures becky, that you just mentioned are shaping up, we're now kind of largely lower marginally. so but i want to kind of show you the intraday chart right. post jobs report to show you just how much volatility there was and then how things have kind of

collapsed a bit here for the s&p 500 futures picture. we did shoot up. you can see here just around the number. and it went up markedly. so by about 40 points on the s&p 500 futures picture before kind of settling down to where we were lower than what we had just before the numbers came out. with regard to the interest rate complex as well, the two year note yield, which some view as a proxy for fed policy in the future. you can see a 3.9% move here. we did see a slight move higher. and now the rates have moved lower to below where they were before the jobs number came out. and then to put the volatility picture in focus as well. s&p 500, the vix index, the cboe volatility index right now 2485. we did see a move lower. it was just around 25 just before and then has moved lower. and then kind of crept up a little bit. the number seems to have taken a little bit of the volatility out of the market. i will also point this out guys. the long term 200 day moving average of that volatility index just about 16

to 17. so we're still elevated. we'll keep things posted i'll send things back over to you guys. >> okay dom thank you for that. what a day. what a program. lots and lots and lots of news between scott benson, the jobs number and the food fight. >> do you have more to do. >> and all of that? >> i'm gonna go take a nap. >> have a great weekend, everybody. >> i am, i'm on a nap. we'll see you on monday. >> squawk on the street begins right now. >> party tonight. >> good friday morning. welcome to squawk on the street. i'm carl quintanilla with jim cramer and david faber at post nine of the new york stock exchange. futures are a bit mixed. on february jobs up 151,000, the 50th consecutive month of job growth. but the work week, news cycle lows and u-6 underemployment. biggest jump in five years. ten years still below four and a quarter. and that's where our road map will begin. payroll growth coming in a bit less than expected. s&p coming off the worst day of the year so far. >> plus broadcom is the