default still has inflation, stan druckenmiller believes the u.s.conomy is teetering on the brink of recession he is predicting that so-called hard landing speaking yesterday druckenmiller said the downturn could occur sometime in the second quarter t quarter we're in right now he cites several fa fac tors including weakness in retail sails and the turmoil in the regional banks. >> i'm not predict something worse than 2008, so i don't want to see headlines tomorrow they said something worse than 2008 is coming, but i think it's naive to not be open-minded to some sort of possibility to that effect. >> let's spell out what he's talk about he defines a hard landing as unemployment topping 5%, quarter profits slumping at least 20% and a rise in bankruptcy he adds that policy makers have less wiggle room than in previous economic cycles let's talk much more about this. annika, great to have you here. >> great to be here. thanks, frank. >> i know you represent one of the biggest banks in europe, but certainly you have your eyes on the u.s. do you believe

francine: stan druckenmiller has caused a recession -- called for a recession in the u.s.. most executives and money managers have said we make a recession but it will be a soft landing. this is a view that it will be more dramatic than that. what is your sense of how much of a slowdown we could be getting in the u.s.? mike: i agree with my friend cameron who wrote a nice piece which i agree with which is that cash holdings in the economy are relatively high right now. the consumer has still got access cash and savings. corporate also have access savings. if you put those two things together, it is difficult to imagine why you have such a hard landing given balance sheets both consumers and corporate's are in good shape at the moment. francine: with the banking crisis, are you convinced we are past the worst of it? mark cudmore is making the case that the deposit moves are going to start to reduce come june because people have made those decisions. how confident are you that the resilience is coming back to the banking sector or do you are still there? mike: there is a leve

druckenmiller again in his comments likes nvidia, bullish microsoft.bet >> are they behind the eight ball it's the first and second inning there's a lot to go there. they have a lot going. you made the reference of hype they still have solid businesses this is not just the catalyst that will get you going. i'll give them the benefit of the doubt because they have solid businesses >> simply put, scott, there is basically little priced in as far as positives go. there's a lot priced in for nvidia and microsoft you said something earlier in the a block about, hey, the market is not priced for a recession. most of the faang stocks, you are right. i would look at microsoft and nvidia google, i would say it's already priced in a recession, priced in what microsoft and other ai players are doing. i think the value is there >> do you worry? do you share some of the same worry brad gerstner and others have expressed that they let other companies like microsoft get -- if you want to play sarat's theory we're only in the second inning, if you have the best arms o

you're winning >> you mentioned stan druckenmiller.bviously, well known originally way back when from working with george soros at quantum, but clearly a great investor in his own right or at least one we want to listen to. >> sure. >> sometimes we say great investors, billionaire investors. really, their only talent is actually raising money and trailing the s&p that is the case for so many so many. >> i went through his delivering alpha presentations. >> yes >> i would go so far as to saying he is a broken record, but that the broken record's right. but here's the issue and this is the case with many a strategist from the top or, you know, practitioner he's right inflation's been terrible, but you've made a killing if you owned the right stocks >> right >> so, it doesn't necessarily -- it's like, i took -- i studied galbraith at harvard, because i'm really smart everything they said was correct and i invested the bejesus during the period, and i made a lot of money, but i was wrong in making the money, because they told me i was wron

stanley druckenmiller and david tepper loaded up on all things ai in q1. valerie tytel is at the data investigation. what does it tell you about the ai trade? valerie: good morning, everybody seems to be chasing this ai tech trade. some of the two most notable family offices run by stanley druckenmiller and david tepper both dipped their feet in some of these ai stocks. both of them increasing holdings of a company called nuvidia. that nvidia stock is up almost 100% this year. it is one of the top performers in the s&p 500. they loaded up on other tech stocks. druckenmiller's fund initiated a position in microsoft, the holder of chatgpt. when it came to appaloosa, they initiated a position in cathie wood's arc innovation etf, and also with tesla. these filings are from the end of q1, so it is unclear whether they have already profited from this trade. dani: it is interesting seeing someone looking at a construction company that set it is ai. the hype is alive and well. i started off talking about how berkshire hathaway said he liked japan stocks and the en

. >> it's just starting to take its toll it's like the druckenmiller thing we just said, and he saidt a look under the hood first, it was the regional banks, and in his words, quote, a lot more bodies coming. >> i guess i'm honored to be mentioned in the same comment with druckenmiller, but yeah it is early. it's early in the whole process of a slowing economy, and there's nothing that you can look at that would say that the economy is actually strengthening anywhere except for the labor market, right? >> that's one of the most, if not, the most important part right? we're a consumption-based economy. two-thirds >> i get that, but if we get back to what wall street has to restructure to, it's higher rates across the board a higher cost of capital everyone is, i think, impatient about this cycle because they're used to this v bottom that we've seen after lehman, and that's not the reality anymore. i'm old. st i started in the snl cries. that's what we're going into >> and as stanley said, you find great opportunities like you did in 2001 after the tech bubble burst. >> yeah. >> you're

. >>> plus a new warning from famed stan druckenmiller he's bracing for a hard landing. it's may 10th, 2023 and "squawk box" begins right now. ♪ >>> good morning, everybody. welcome to "squawk box" here on c cnbc we are live from the nasdaq market site in times square, yay. i'm becky quick along with joe kernen andrew is on assign management this morning he's going to join us a little later in the show. you can see there are modest declines dow futures off by 30 points, nasdaq down by 23 points, s&p futures off by 5 points. if you look at the treasury yields, that's the markets we're watching right now the 2-year above 4%. 4.049% on today's squawk planner there is a key read on inflation it's going to be the april consumer price index which is expected to show a rise of 0.4% of 1%. that would be up from 0.1% interest march cpi data due we'll bring you some predictions a little later this hour. >>> famed money maker stan drug miller believes the u.s. is teetering on the brink of recession and he he's predicting a hard landing he was speaking yesterday at the conference he

we saw -- the name is escaping me -- he came out -- druckenmiller, he came out with a charshortfall.> i wonder how you were thinking of u.s. fixed income over the european fixed income christine lagarde has more way to go. >> that is why you don't have the same type of cuts in the european curve as in the u.s. curve. you still have hikes look, it is a relative game. the u.s. is likely on hold the ecb likely has more to do. the bank of dpengland has more do we are seeing that wage price spiral happen. you know, we will see, you know, some of that we think about it. yes, there is the interest rate difference, but the flows. >> just to wrap up the currency conversation we have been watching the japanese market this week and the japanese equity market is strong nikkei up 17% year to date six positive sessions in a row what do you make of the outlook for the yen and do you buy into the economic data in the last week >> i think one of the things we are seeing in japanese equities is a potential growth area people are putting money into that get a bit wary of the chinese reopening trade. th

let's say that plays out, but there is a deep recession, a hard landing like druckenmiller says.biana: that would not be good for equities. markets are pricing a mild recession. the truth is, it is difficult to understand what kind of recession we're going to have, or what the timing is going to be. big, or slowing down. but it is not really falling off a cliff. you have better-than-expected data points. on the earnings side and on the job site. from that point of view, we don't know what kind of recession we will get. if we were to get a deep recession, that stan refers to, that would not be a good image or a good environment for equities. clearly, fixed income markets would be better poised. dani: they have that yield, which is certainly more attractive. i do wonder, if you start to position that way now -- if you say look, something has got to give. it either has to be what we are pricing in for fed cuts for the equity market, you want to start setting yourself up for that, when you make that trade? fabiana: it is difficult to predict at the moment. we recently wrote a piece t

heck out of people when you couple that with the words "broadcast by us" from a guy like stanley druckenmiller, still one more billionaire that doesn't like what's happening and chooses his words carefully and you get another generational exit from the market just when you should be buying, destruct enmiller is right. there has been way too much stimulus, they kept rates too long too low, but the fed has been tightening like crazy come on. he said in 2022 he's made a lot of mistakes, but heowned up to them well, you know what? so has the fed sadly, the billionaire class is never going to tell you to buy anything when you're already that wealthy, you tend to have very different financial priorities from our viewers because you only need to get rich once and i'll never forget that so let's do this raise some cash. we told people on our home stretch segment for the cnbc investing club, we sacrifice even some of our generative ai winners because they're overheating. we've taken our cash position higher for the charitable trust. but then you wait. do we get another 19% decline like 2011? i don't kn

thing for the stock market but then you said a trading range -- you said you agreed with stan druckenmillers that are going to be competing with each other in the short, intermediate and long run we have a long-term productivity boom that's going to come from llms that within the stock market -- >> that's a.i., large language models >> right, a.i. within the stock market, there's going to being huge winners and huge losers. so he can be right and i can be right because there are going to be some big winners and big losers >> okay. layer into this, though, the banking crisis that we're living through today and the debt ceiling debate >> i'm going to need a model to figure all this out, right so the debt ceiling debate reminds me -- i just had my first granddaughter three weeks ago. >> congratulations >> and i forgot -- >> thank you very much i forgot when you're holding that baby that after they've been feeding they tend to do a little throw up all the time, right? so i think that's what this debt ceiling is going to be it's going to be kabuki theater, a little throw up. the real question is