Transcripts For CNBC Squawk 20240704

Commentary plus back off the worst day and week of the week, the Company Reportedly looking to boost its efforts in a. I and elon musk and Mark Zuckerberg seemingly agreeing to that cage match, but some hurdles still ahead. Lets begin with the markets. The s p, nasdaq, as we said, coming off their worst week since march, jim that reversal friday didnt feel great. Oh, my. It took your breath away and i was watching them just saying, what happened . Is there some event . Did something happen that was exogenous . But then again, look, lets remember, bonds having a nice move today they were down 36. Now theyre only down 11 i thought that friday was one of those days where people just said, okay, weve had a great year now, lets just sit here and sit on our hands and that was what i was thinking to start my show tonight is to just sit on my hands, and i may do it. I just felt that weve made a lot of money, and maybe thats what were going to make for a month. Youve been pretty leery of this period. Yes, i am i dont like this period kind of reminds you of some of the calls this morning, say, take b of a on nvidia. Sentiment is going to be more subdued than last time you have made a lot of money hes got a talk tomorrow. But my problem with nvidia is, like, i had Larry Williams on, one of the greatest chartists of all time, and he started out by saying, jim, youre wrong on nvidia here, which, david, i always find is a little intimidating when someone just says, youre wrong uhhuh. We havent been together in weeks and youre already like, uhhuh you didnt even look up he said that im going to be wrong on nvidia. I heard you okay. I always hear you your most trusted technician. It was very jarring because nvidias had an amazing run. You know what i think of jensen huang. Im aware of what you think of nvidia. Ive met people at the eagles who thanked me for nvidia. I dont need any of his nonsense as they should. Whats the point now the point is that wow see . Thats okay. Thats jason, and he loved nvidia, and i got to tell you, i did well for him i know you did, and for many, many other people, and not just that name, jim but lets get back to that chartist guy good picture. Market historian. He said that when you have a stock thats up this much, 200 , youre going to get a little giveback its up the most of any stock in the s p. Its not a meme stock, by the way. Its not rite aid. But those things tend to be for companies that are on the brink of bankruptcy. Or on the brink of a very difficult period you know how sometimes you get a bad steak and you stick a fork in it why dont we just stick a fork in rite aid right now. Its only going to make it go up more. Well, i dont care. I like to save people money. We sat here with gamestop for quite some time and it only went higher and higher, and then a lot of people made money ultimately, you know, the fundamentals do reign. It just can take years before that happens well, look, rite aid is at 297 the government wont allow cvs to buy it. They wont allow walgreens to buy it theres no natural buyer the company is doing poorly. The meme people seize on that because its a 2 stock. Sometimes i play the lottery i havent really won big yet i did win we should point out rite aid is tiny. Like, three of his houses. Yeah. So, i mean, tupperware, i talked to some execs who used to run up the irtupperware it got hurt by covid because its doortodoor. No one regards it as being this kind of stock. But these people run the stock a lot of them do it through robinhood, and we want them to start thinking about other things like, if yellow goes under, you should buy xpo thats what they should be thinking about they shouldnt be thinking about rite aid because thats not going to have any reversal here. Theyre not going to call in and say, you know, youre quite wrong, were doing well in the prescription business. Especially with cvs and walgreens doing among the worstacting stocks. It would be one thing if we had an ftc that blessed anything, but the ftc blesses nothing. I mean, ive been working on the amgen deal amgen horizon oh, you looked up, thank you. I spent a lot of time on that as well. I think that deal is going to be trashed by lina khan. Its easy to say that because, of course, theyre already suing. So, yes. But its putting pressure on what i think is a very good deal for people for americans. People who have examined that deal, jim, do not believe the government has a very strong case to be made here for stopping it on any grounds there is a belief theres a belief and i have ive reported previously on talks about a settlement, you may remember, between and they broke down but there are many who believe prior to any trial, i think its late september were talking potentially, you would see it again, a resumption of efforts because the staff may not want to see this thing go to court and lose again but remember, amgen has made pledges they wont do this rebate situation thats right. And lina khan says the head of the ftc says, thats meaningless. When i speak to people within the ftc, they always say the same thing hey, you vetdoted for us. Thats what you get. I think its a little bit of a different more complicated situation than that. Youve got a longtime staff who may not agree with everything being done by the commission but yeah. I think theyre professionals. And i do think biden did outsource to a certain extent to warren and sanders thats what people say. That the senators thats the reigning thought, at least amongst the m a world right i think thats right senator warren, she doesnt like deals. I dont want to get too far afield, but when i look at this, i say to myself, youre not going to get bailed out. The people who are buying right aid, thats just greater fool theory and thats driven they can gun it to 4 but theyre playing the bgl game bgl bag it, gun it, and liquidate it bgl. You ever play bgl . No, i havent its like canasta. Thats back to cramer days . I never bgled, you son of a he comes in, he comes back, and hes just hes accusing you of bgling. You call me every morning and say, they upgraded this one, they downgraded that one, and then when i reported it, im sure i know who was selling. I never did that. Thats really unfair by the way, you wrote a book about it yes, i did. My lawyer said, if you write this book, youre finished i said, if someone else writes about it, youre finished. I wrote about it, and i guess i was finished that was a really good book one of many thank you im mentioning it only because we could talk very easily about campbells, which we will, but i just i dont want people to get bgled on reddit i watch the tape, and i say, younger people, youre playing and how much fun is that have they been to a rite aid my pharmacist is terrific. Used to be a little pharmacist, but i dont think thats a reason to buy. Well get to campbells in a bit. Lets cover berkshire, though. Net up 6. 6 massive cash rose to a near record the general take is rates affecting various Business Units and then valuation of equities sort of limiting their buybacks, limiting their purchases Evan Greenberg from chubb is doing a better job than they are with insurance, pointblank. Geicos not insurance is a fungible thing geico had a better quarter. The ratio was not great versus what Evan Greenberg put up, and the rail horrible down, what, 25 . More than 20 . And now, apple oh my. Well, its still been an incredible winner. Up 40 this year. Incredible. I think, by the way, the reaction of apple, down friday, down 4sz and then down 9 , those are people who feared downgrades today, and they didnt get the downgrades, so lets see how they do. Theres been some work this morning on when you get this overbought, how long does it take to absorb the other, though, is that the time period between the june quarter earnings and the phone announcement in september, citi argued friday usually beats the s p. So, that would be something i mean, i remember when i lost my i lost my 13, lucky 13, which showed up, by the way, in bolivia. I thought that was interesting i had that find my phone. I got the 14 the week it came out. Weve been in 14 for long time, and yet the analysts and the people are acting like 15 is out and its a bomb. No one believes in vision pro. No one and yet, i wanted to watch hijacking vision pro watch hijacking . I havent i love idris elba, loved him since the wire but have not watched the hijacking. Remember he got the degree from Baltimore Community college . I do. But back to Apple Vision Pro and somehow hijacked, what i just think vision prois the way to watch that kind of movie. Youre one of the lucky few whos had a chance to even try i just think id lie on the couch and watch it and that plane scene at the end, no spoilers, but i think this is the way to watch things. People are averse to having any goggles unless their snorkeling. This is not going to move the needle for apple for quite some time how about if tmobile dsecids if you switch, or buy now, pay later. Even the carriers are not going to youwant to subsidize tt maybe mike seifert likes it maybe they give you buy now, bay later over the course of two years. Other debate, you talk about weve been in 14ville for so long, but the phones at this point are so efficient is a fouryear upgrade maybe thats too soon . Look, theres always something that blows you away. They are doing so well in these countries, when you add them up. They come to a billion people, but were so not knowledgeable a lot of this is india, but remember the philippines, indonesia, turkey. By the way, their currency, how about their currency i mean, a lot of people just feel like, wait a second, the dollar has been okay but they sell in a lot of countries where the currency is, lets just say, lets go there and have a steak dinner. Yeah. So, apple, youre defending apple here yes you think that i am. That move down is over . No. I just think you own it, dont trade it they buried the stock a million times. Can i just say that amazon, i didnt get to talk about it . That was a wowser quarter, and jassy has cracked the code the regionalization of 200 skus. We get colgate toothpaste coming from texas to new jersey, and theyre losing money but you do 15 regions, what a call were you on the call it was fantastic i was paying attention, actually you were paying attention i was on vacation, but i still managed what does that have to do with it . With his iphone i was reading im not quite like you where there is no real vacation. Vacation is a chance do really dig into calls. Other than the ten minutes you spend in your tomato garden in your tie and suit do you take transcripts of earnings calls into the tomato garden sometimes i do. Yes. I had tomato blight and i had to pull three plants and i was very upset, so i take a Conference Call sitting in the garden thats how i relax it gets you calm. Dirt all over it. I dont understand what you do i mean, thats what that call is for is to make you feel better if you have tomato blight. By the way, the eagles all had nvidia all of them. All of them. A. J. Brown did not have nvidia but lane johnson coming up after the break, well get to some of the research we got today plus the latest on this possible cage match as the two billionaires trade more jabs online over the weekend. Take a look at the premarket more squawk on the street in a minute sfx people cheering sfx Stock Exchange bell ringing sfx people celebrating sfx people celebrating sfx Stock Exchange bell ringing nice footwork. Man, youre lucky, sfwatching live sportsg never used to be this easy. Now you can stream all your games like its nothing. Yes thats what im talking about. [ cheers ] running up and down that field looks tough. Its a pitch. Get way more into what youre into when you stream on the xfinity 10g network. Elon musk, Mark Zuckerberg, seemingly agreeing to their longanticipated cage match, exchanging jabs on their respective social media platforms. Musk says all proceeds of the fight would be donated to charity, adding it would be live streamed on x, to which zuckerberg responded, shouldnt we use a more reliable platform that can actually raise money for charity . As for when that might take place, musk says thats in flux. Zuck says, im not holding my breath i mean, i said originally they were aiming for late august, and zuck had confirmed august 26th, the coliseum was something they were talking about, but musk has not confirmed a date, and now we see this tweet about his back and an mri. That was very brutal of him you do wonder if hes thats still from, what, the sumo wrestling match that he did a number of years back its something that shouldnt happen no. I mean, it cant be a good sign for the world when two of its richest men are going to get in a cage fight of some kind that said, if it does happen, im going to be there. Along with a lot of other people of course, youre going to be in his corner. Ill be wherever i have to be youll be giving him ammonia. That will be you there are plenty of people who have underestimated elon musk you through the years, but zuckerberg has been training in brazilian jiujitsu for years zuckerberg will crush him hell crush him. Its not even a fair fight by the way, you know whats not a fair fight and i know people are worried about in terms of liability . Will youtube be ready for the nfl . Theres no backup you mean sunday ticket . Yeah. Thats a good point but when you say, ready for it, you mean well, i dont want them to be overwhelmed if theres a big game if anybody has the capacity to do it, datacenters, it would seem to be alphabet. Im concerned i mean, directv, of course, stick a fork in that who wants that theres the tyson foods of tv. But i know many people who feel like youtube needs some practice, and youre not going to get it during the preseason because no players are playing hard to practice that kind of event, that kind of scale, and the bandwidth needed i know. By the way, we should mention, ak out of tesla today, cfos leaving, stock is down about a percent, i think hes been there for 14 years. Stepped down august 4th. 13year tenure master of coin, dont forget and the chief financial officer. But musk runs that reference call didnt musk alsos say over the weekend that title of ceo is by its very nature fake . Its unbelievable you need a president and a secretary and Everything Else is fluff. There you go. Certainly any pr people whatsoever, which, of course, has always been the case with musk and anyone else to hold your hand in any way. He grew up. The Conference Calls sound like Procter Gamble now the tesla Conference Calls i would never take that in the tomato field is that a bad thing or a good thing . Its no longer fun. Theres not a lot of fun Conference Calls these days. Look, im not asking for Henny Youngman or chris rock i just want some levity, and i find that musk now is very tiresome, just, you know maybe on his call but not in his twitter feed and he is still potentially going to get in a match cage fight i think hes more interesting in a way i think that something happened to him to make him so that hes quite boring on a call the call just sounds like its another call consumer packaged goods call i mean, touched the hot stove a couple of times, maybe you pull back. I urge people to listen to calls. If you want a call who was the best call last week . Amazon. No, in terms of the an arc of interest. Amazon was the best in terms of the numbers. I dont know, jim dave zappo. Really . I thought you were going to go there. Brian runs an unbelievable amazon call, but it helps that it was an amazing quarter. Costs were down incredibly they didnt sacrifice any sameday whatsoever. The amazon prime was just a showcase of american consumerism. We were concerned about a deceleration in growth at aws and the market it stabilized looks like people trimmed back and then started going back. That ad business, incredible. Yes, but now its 12 going to 15, maybe even 20 in terms of Amazon Web Service do you know when i said i drew the line in the sand at 10, they were angry i was right. There is some reaction from the analysts today on some of the quarters last week amazon, apple, wayfair, draftkings such a short squeeze. Well talk about those. Draftkings is a great number. Hows rite aid doing well get cramers mad dash, countdown to the opening bell one more look at the premarket on thimoays nd busy monday morning, just getting manheim used car prices. Thats going to compute into cpi. Opening bell in a few moments. You can catch us any time, anywhere just listen to and follow the squawk on the street opening bell poas dct. I fundamentally believe if we dont disrupt, we will be disrupted. There is a clear need for products that are going to make people safer, that are going to make the environment better, swords clashing had enough . No. Arthritis. Here. Aspercreme arthritis. Full prescriptionstrength . Reduces inflammation . Thank the gods. Dont thank them too soon. Kick pain in the aspercreme. The opening bell is brought to you by nuveen, a leader in income, alternatives, and responsible investing. All right. Time for a mad dash, two minutes before we get started with trading at the new york Stock Exchange where do you want to head . Ive been following the idea that we should have a stablecoin, which is the way you can interact with crypto right now. Its been a couple companies that some people think are sketchy, but paypal is launching, and now theyre paypal had just an okay quarter, but to have their stablecoin backed up by treasurys and currency and actual dollars is very big, and i say this because i have had former head of the cftc on twice saying that theyve got to fix this. And if they do it, the stablecoin is terrific and tim massen, who i like, and this is really the possibility of very positive quarter shares down 34 for the last 12 months, and if you go back two years, it is just ever since the breakup with ebay, i thought it would not be significant, but it was. Ugly. And the decline has been horrendous, and you know theres been activism. But for them to be able to do a stablecoin may actually begin the discussion in congress about how we got to start regulating it and not just having this angry match between chairman gensler and the industry so, i regard this as very positive now, jpmorgan is not going jpmorgan is not going to stablecoin. Since ive actually asked them they said, are you kidding me . But this is very important and i think that paypal is the outfit youd like to switch to i mean, i would. If i were doing crypto right now, id switch to paypal. Id put my money with them there you go thats what i would do all right lets get the opening bell here at the cnbc realtime exchange at the big board, its a manufacturer of graphite electrode. Celebrating its fifth listing anniversary. And at the nasdaq the winner of the chicago innovation awards, recognizing new products, services, and companies in chicago. As we get some decent breadth, try to work our way back to 4,500. On friday, jeff degraaf said, maybe consolidate to 4,300 i think that could be look, wilson book, morgan stanley, talking about how the macro blew it. But a piece from goldmansachs says its a stock pickers market individual companies are doing things so its not good to look at the s p i thought that was a great note. I have individual companies on all the time, and i just tell you that theyre doing so much better than the aggregate. I thought that is david on today . Kostin . He was so good. He really spent a lot of time looking at the individual stocks, which i loved. Now that were so far through earnings season, and it was a great note jan thinks they do not move in september or november but then goldman comes out and says its important that they raise the long bond would seem to indicate that, well, you know, theres a i would say that theres a that the numbers are very are really strong for the economy still. I know that theres a wage number that you could argue wages per week, hours per week, im sorry the workweek. But the economys still very strong, and i can understand why she said that. And i think that another rate hike would not be wrong. At the same time, you do have williams in the times saying that you could get cuts in 24 why did he say that his argument is real rates as inflation cools, theyre getting more restrictive by the day. I just dont want i dont want to get ahead of myself because the economys regathered steam. Theres a lot of company when amazon does its number, david, you know, amazon is a great barometer of the economy and everyone said that only people the only stem was on travel its on amazon it is an enormous platform, as we know, and so you think it can be a reflection of overall consumer demand . I think that people one of the few habits that was learned during the pandemic was to use amazon, and so its very hard to gauge retail without looking at amazon, and i think that the federal government still has not caught up to the way that the Digital Economy is moving, which is much faster than the federal government very important i mean, even, you know, the Justice Departments case against google yeah. On advertising . I think when i look at it, they dont include tiktok they dont include youtube but i justi think that theres lots of ways to advertise, and i dont think theyre including them so, the Justice Department may not be i thought that case was pretty good, but then i started thinking about all the other places you can advertise and then i wonder whether is this relevant . Things are going so fast you have thought the doj had a strong case there. I did until i realized that theres so many other places to advertise. You know it too. Well, by the way, back to amazon, 10. 7 billion in advertising revenue for the quarter makes it one of the largest advertising platforms around imagine that thats over 40 billion a year in revenue i think Justice Department has to if they sat back and looked at everybody, they might say, you know, theres really not there may be monopolistic behavior by google, but its not winning. I just am pointing out theres another side to the trade i mean, to the fed interesting how often you do come back, jim, to the ftc or the doj. Well, because theyre occupying a decent amount of your brain if you want to know whether the kroger deal goes through, which is a big deal you can just get the answer, which is, no no. The answer is, no. The answer is going to be blocked. David, you spent a decent amount of time on microsoft and Activision Microsoft took them on and won i was not questioning as much microsofts ability to potentially prevail against the ftc as i think many were wondering what the process would be like in the uk. By the way, were still kind of wondering. I think its what is it, the end of this month is when the break fee goes up. I thought it was august 29th you know, were waiting on that one. But that was where i think, jim, we really many people misjudged, perhaps, in part because we were didnt have as much familiarity with the process in the uk since its kind of relatively new that they had an they always had an antitrust function, but for a long time, they were part of the eu im fixated on it because i think one of the reasons why were stalled here, carl, as we talked about, is because i think theres a lot of companies that are intimidated to do a deal we got two that did do deals today. Private equity . We got a private equity deal for a essentially a packaging company, but lets do the other one. Weve sort of hit it very briefly, which is campbell buying im so glad you brought that up campbell buying a brand rayos. People may know that wellknown restaurant in new york, but many years ago, licensed their name and recipe its the sauce of choice in my house. I dont know about yours do you know why that is its also, by the way im just quick take from one raos sauce velocities are roughly 60 higher than other skus and while their top five skus have 80 distribution, the next five are 20 below that and still very highvelocity items what does that mean . It means that campbells big runway. Particularly in the frozen food. 837 million in calendar year 2022 revenue i think its very exciting field. Now, david, as an aficionado of tomatoes, the italian tomatoes, you know i grow a pretty good carl knows my garden is not bad. Im going to be harvesting my olives this year not domestically youre not able to export those olives im not unfortunately. But i do have a couple of bottles if you want to try it. But i will tell you, now, this is very interesting. Mark clouse, who is a fantastic ceo at campbells, went there. David, those tomatoes are from nearby the companys in naples, but pompeii. Now, pompeii, lava soil. Very rich the richest why are we talking about this thats raos. Thats where they make the tomato sauce you think they get it from 115th street no, these are tomatoes im jealous of the soil. Does new jersey have good tomatoes this time of year campbells, thats where it started. But david, if youre going to pick a place, you want to be in italy, and you want to be near pompeii because that is the holy grail of tomatoes. Got it. Its mostly they do roman. They dont do beefsteak, okay . Jerseys beefsteak 23 bucks a share. Campbells shares the romas, you know im aware they dont have a lot of seeds. Thats what they use, and theyre delicious. And if you like to package your tomatoes, then you can probably get something from verativ, jim, which is getting bought in a private equity deal. Were not talking about deals in terms of things that are particularly large that was a highmultiple stock so its interesting what will happen but they now have their meal section dont confuse it with vertiv. They did a big secondary. Theyre doing a 20 million share secondary. What you want with campbells is now the food business is more than 50 , and that means its not just trapped by the soup era by the way, i like the soup era. I happen to love campbells. But thats because i grew up in a house where campbells was good they would put more water in it in order to let it go further. That verativ deal is i would appoipoint out, the finang for it, again, its not a large deal, is banks, as opposed to many of the private credit firms, funds, alternative Asset Managers that provide private credit this looks more like an oldfashioned syndicate, rbc, wells fargo, u. P. S wow pretty cool. Goldmansachs by the way, do you ever notice goldmansachss stock, how it goes up a little bit every day . No, i havent it is interesting they are getting out the big thing will be, are they going to get rid of the credit cards . Will someone buy the credit card after they spent a fortune on it this is a new broom sweeping clean. There is nothing that is not on the table other than private wealth management. I think its very interesting that this stock just does not quit after a quarter that a lot of people felt was hohum. I did notice jeff currie, their well known head of commodities research, leaving the bank after 30 years. He made some bullish calls that didnt pan out, although, maybe well get there. I think its interesting because the aramco numbers were so awful, but the russian oil that comes through india to the west, really too bad financing a war. It is and nobody does anything. Well, im not sure what youre supposed to do, but yeah. They want helicopters, and they want jets and you cant beat the russians without helicopters and jets although, we did have this summit in saudi arabia, and now china looks to be supportive of another round of peace talks were getting headlines on potential pathways to peace talks, along with new drone strategies that are getting more aggressive well, i think that a peace talk now would be disastrous because that would lock in the fact that the russians won so far. So far, slow going with the counteroffensive because they dont they threw in tanks against you need six to one to be able to win. You need six to really win, you need six to one. And then theres going on in the black sea, which is going to have an impact on Commodity Prices or grain. Takes out 13 of the worlds calories come from ukraine thats going to cut back yeah. The rest of the worlds pricing is going to go up. Brazil, pricing is going to go up United States, farmers are going to do well, but if you go buy deere and agco or c h, they have not been great. Caterpillar, different story, though caterpillar has been amazing and thats because they are datacenter they are oil and gas they are mining, and people keep thinking theyre china, and china is less than 5 of the company. Kind of reminds us of tyson today, down nine they do miss on the top and the bottom line. They do reiterate the fullyear sales guide. Yeah. Which is roughly in line. I may have to take over the company, i think im good at food i can just run the company from here remotely. Forget the chicken. Plant a lot of tomatoes. Chickens are hard the darn foxes, they rip their heads off and dont even eat them what the heck is that . Thats the tomato blight i dont know how many of those are going to turn. I wish they would put the real picture of the tomatoes because i had a great yield this morning, and lisa and i made here these are the ones they took from the blight. Blight means you have to pull the stuff immediately. You cant even wait. You cant let it spread exactly wow. Look at farmer dave. You know me back in queens, we had a lot of big gardening. Known for their soil. Very good soil. Like pompeii. Jim, you mentioned well, you know we have did we hit what happened at tyson, what the problem is myriad problems how about management sales flat, gap operating income down 98 , but that was impacted by a number of different things, but i guess, overall sales down 3 from the prior year for the Third Quarter didnt help. They do say that theyre fully committed to their vision of delivering sustainable topline growth and margin improvement. Really . Yeah. You know, i used to talk to them all the time because i was a believer that they could turn it around, but it just i mean, look, this is a business where we all pay too much for everything they make, and it doesnt seem to matter it just doesnt translate to them hows that possible . Look at apple. Geez i told you it wouldnt be up one thing we didnt get to, jim, was some cyber the debate around fortinet last week guggenheim comes to their defense, although wedbush does remove palo alto fortinet is going to hurt palo alto. Its a stock that i own if for my travel trust and people arent happy theyre going to report on frizz day night, and fortinet was upgraded today, and wedbush pulled palo alto, and dan ives, im sure, which i dont know if dans been on a couple times yet today dan has dan fills in for me on friday night does he amazing killer he wears that yellow blazer. Kind of like what he used to wear on wide world of sports. Two thirds of the world is covered by water and the rest is covered by dan ives. Palo alto will be down. My travel trust, were debating buying it, but i feel like let the fortinet effect sink in and see what happens of course, the ad market, and we will get disney on wednesday. Paramount tonight. I think disneys going to be terrible he already told them. I know, but i think the i think the forecast is going to be bad i think its just bad. My trust owns it youre supposed to say, why . Ive asked you that already ive got a longterm view im like one of those people who come on tv youre going to need a longterm view, and iger says youre going to need a longterm view, but he did everything he could, i think, to say how difficult things are theres no way you can in terms of the quarter thats going to be reported and by the way, when he sat down with me, the quarter already had been completed he obviously couldnt talk about it at all, but he certainly capable how challenging both for Linear Cable Networks in terms of losing subs and the ad market hes a green bay fan, and green bay is as bad as disney. Guys, iep, a company were following. Carl icahn down another 8 . They cut the dividend late last week people may be aware. Still a very significant yield, but it is getting a different shoulder, maybe, i dont know. Like what a Shareholder Base hindenburg has theyve won that skirmish for now. Right well, i mean, when you have that kind of strange valuation, you have a margin call, doesnt he was able to you know, he righted his capital structure. He, being carl icahn, by getting the banks to step in and renegotiating certain loans and things of that nature. So, he does not have a margin call he was so short the margin, he would come on air and just say he hated the market. Very negative well, where did the market went up. That was not a good call. No. That was that was a suboptimal call the whole way. Yes and over time, i think, when you look at the returns, they are not particularly strong. As they are not for many of the big firms and well known managers that we talk about often. What do you think about blackstone hanging in there . Wait, what . Their manager, Jonathan Gray, hes doing a good job. Yes i dont equate them in any way with what i was thinking about Large Hedge Fund no, theyre all negative and they dont want anyone to make any money. Like, no im talking about performance over time. Blackstone is a giant. Theyre more than a trillion dollar alternative asset manager in virtually everything. I just we used to talk about this breit all the time. Things collided exactly what Jonathan Gray said happened. He said, its fine, and it didnt matter. Whats the best chart in the book this is very interesting carl, you want to give it a guess . No. I dont either. Boston properties hows that possible . 5. 7 yield stock clearly bottomed just going up. Theyve got a lot of aplus buildings. They do earnings were well received that is some tornado also looked similar theyre coming back a lot of challenges in the office market, but as you point out, jim, if you own a or aplus, youre in a much better position than if you have a smattering there are headlines today about the d. C. Agencies pressuring their workers to come back this fall zoom telling their employees, come back for at least two days. Wow you never had to work at zoom if you never had to go to zoom no, its zoom gensler is not going to be in front of the fireplace wow that will be interesting because hes been like a yule log. Really . Is that what you play on the holidays you play a video of gensler by the fireplace . I like the chairman very much lets turn on gensler i was waiting for that. That was funny. It was funny my stepson works at zoom, never went to zoom there was no reason. You see, its by remote. As i like to say, were the only people who show up five days a week inperson and wear ties thats it. Us fridays, i dont i dont like being off fridays. I have to work on that what the heck is that about . I think they want me to be off fridays. We want to pace you im doing all this work anyway those are fractious and unruly i once adopted a thoroughbred. You cant. You cant. Theyll just throw you we need you to keep going we dont walk behind you because were worried youre going to kick us we got to pace you. Retired Police Horses are the best horses to adopt have you seen the dog we adopted . Tony to go with r giga . Rigatoni im so happy to hear that were trying to figure out what religion he is. Has he told you not yet we used 23andme. Thats not religion lets check out bonds today we got some mixed signals in yields, but the tenyear, still around 4. 07 twoyear, 4. 77 . We got some stabilization. Five points shy of 4,500 again be right back. Progress toward global net zero will take big thinking put into even bigger action. It starts with us developing and deploying Carbon Capture and storage to help lower our carbon intensity. While also developing partnerships to create worldclass storage hubs to help other industries, like cement, reduce their emissions too. Innovating toward Lower Carbon Solutions today, while helping others do the same for the future. Thats energy in progress. The first time your sales reached 100k with godaddy was also the first time your profits left you speechless. At the counter or on the go, save 20 with the lowest transaction fees and keep more of what you make. Start saving today at godaddy. Com apple shares pretty important to watch here. 179 is going to take you back to roughly the first week of june of course thats coming off the heels of its worst day of the year on friday in the wake of its corporate results. Dow up 250 well get stop trading with jim in a moment. Buildings could tell you how they could be more efficient . Im listening. Well, with ibm, you can use software to help you connect and analyze data from hvacs to elevators to lights. What if we use aidriven insights to pinpoint inefficiency . Yep. And act on it. Saving energy, money. And emissions. Yup. Thats a big one. Now youve built Something Better for everyone. Thats the sustainability solution ibm and a Global Real Estate company created. What will you create . Ibm. Lets create. Its time for jim and stop trading. Theres been a debate about whether travel overseas or domestic has turned to the negative, and last week bookings had amazing numbers and the stock is up again. Im looking at expedia starting to go up that would be key because expedia did not have a great quarter and here it goes look, might be a long shot, but hertz could be interesting i just think that the travel trade is being written off too early. I think people are addicted to travel because they realize life is short, you know, a lot of people go to europe going to iceland, save a lot of money and stop there. I think i know at least one. Yeah. But i will say this is an important trade because if we lose this, then we dont really have its like the big theme right now. We did get an upgrade of ual out of redbird. I dont know redbird. Tonight i have enbridge, the most powerful force when it comes to the export of oil in the world, because if they have a cold winter in europe you need them xylem, im trying to embrace the things of what i think matters, water, decarbonization these are the things i care about. I like hearing you say water. Im from philadelphia. I know. Philadelphia did well with nvidia jim, well see you tonight. Good to have you back. Mad money, 6 00 p. M. Eastern time dow up 245 dont go anywhere. Od. Did i say chicken wrong . Tired of people not listening to what you want . Its truffle season ah thats okay. Never enough truffles. How much are they . Its a lot. Oh okay im good, that its like a priceless piece of art. Enjoy. Or when they sell you what they want . Yeah. The more we understand you, the better we can help you. Thats what u. S. Bank is for. Huge relief. Yeah. This is dr. Arnold t. Petsworth, hes the owner of petsworth vetworld. Business was steady, but then an influx of new fourlegged friends changed everything. Dr. Petsworth welcomed these new patients. The only problem . More appointments meant he needed more space. Thats when dr. Petsworth turned to his American Express business card, which offers flexible spending limits that adapt with his business. He used his card to furnish a new exam room, and everyone was happy. Built for dr. Petsworth business. Built for your business. Amex business. Good monday morning. Welcome to another hour of squawk on the street. Im Carl Quintanilla with leslie picker and david faber live at post nine of the new york Stock Exchange. Sara has the morning off ahead of a big exclusive later in the week the ceo of x formerly known as twitter, linda yaccarino, a lot to talk about from the rebranding to advertising and the future of the platform the markets, big week for inflation data later in the week and some last rounds of corporate results on the june calendar quarter market looking past the decline in apple today. We are 30 minutes into the trading session. Here are three movers were watching today tieson foods one of the biggest laggards posting a loss for the quarter and announcing plans to close four more chicken processing plants. Shares down on the year about 8 currently. Lucid shares under pressure as well, the luxury ev maker slashing prices of its sedan by as much as 12,000 amid growing competition. The news ahead of lucids earnings after the bell today in anticipation of that, shares down nearly 5 right now. And Berkshire Hathaway headed higher after results this weekend. The cash pile approaching near 150 billion after a boost in operating earnings thanks a jump in berkshires insurance underwriting and Investment Income shares of Berkshire Hathaway up 2. 7 its monday, which means perhaps theyre buying another 10 billion in treasuriess. When i saw auctions on the calendar it is monday. Mondays are important to the team at berkshire according to warrens comments to becky last week they held Something Like 97 billion worth of treasuries at this point maybe it surpasses 100 billion after today. For so many others the interest is meaningful now as opposed to a couple years ago where it didnt do much at all to the income statement. Yeah. Exactly. Sometimes we forget, i mean 766 billion market value for berkshire. One of the Largest Companies in the world. Yeah. Saudi aramco another one of the Largest Companies in the world reporting. I think fortune pegged them as the Second Largest Company in the world after walmart based on revenue. They saw big profit decline on lower oil prices, which that company still, you know, obviously, very tied, very correlated to what happens with oil, so 40 decline in profit in the second quarter. The Largest Company in the world continues to be apple, despite it is losing a bit of value. Market cap. Berkshire is the largest single holder with 177, maybe a little less now, billion dollars worth of stock still percentage wise very small percentage of overall given its more than a 3 trillion market value. Its not insignificant for berkshire. Unrealized gains helped them in the quarter, but on the energy side that was, you know, a deterrent for them unrealized losses and did pair back their Chevron Holdings as a result of that if you can believe it, we get 13 fs. Wow. Again, already . Starting a week from today. Christmas in august. See trickle through on friday probably Berkshire Hathaway will be monday. They tend to file after the close on the deadline day. Just something to look forward to next monday already. Meantime some of the bears feeling it lately, looking at potential draw down targets. Cfra, sam stow val, 5 to 12 down, consolidation at bay jeff from renaissance looking at 4300 so well see how much of a stand we can make given the lack of earnings that are going to draw down here pretty quickly after this week. I think were up to 85 of the way through s p 500 in terms of earnings. 80 beat rate, higher than the fiveyear average of 77 a decent earnings season, although earnings revised down lower significantly before this earnings season and so i think the question now is, people look ahead to whats happening in q3, you know, is the potential for additional contraction, have we seen the bottom of that . H is the worst behind us as we move ahead a lot of debate in the notes on that front. Speaking of Macro Economics, we have got an host of fed speak and were work through that this morning on the heels of fridays weaker than expected jobs report the man who does that work for us is Steve Liesman who joins us now to try to tell us exactly whats going on here steve . Good morning, david fed governor Michelle Bowman speaking this morning expects additional increases saying theyre likely needed to lower inflation and says Monetary Policy is not a preset course. She is going to monitor data heres her test for saying if we have enough. Evidence of inflation is, quote, on a consistent and meaningful downward path. She added that the labor market remains tight with demand for workers outstripping supply. Her comments were also made, by the way, by new york fed president John Williams released this morning and echoing concerns that friday jobs report may have been more hawkish than the market first thought among the concerns inside that report, job growth has been consistently greater than population growth and thats reflected, by the way, in the still strong wage gains out there. The Unemployment Rate kicked down and even slowing payroll growth seen by some as a result of there not being enough bodies to higher rather than an unwillingness to hire. Chris ruppki writing this could be the first time in economic history Payroll Employment drops which normally indicates a recession, but the reason is theres no one left in the country hire you can see in that chart there, the last two years the problem was solved with the addition of 1 million people, the past two januarys when they do that exercise the government is going to revise job growth likely down, that number comes out in august. Fed officials have to puzzle with this problem that there are more jobs than appear to be people and thats going to keep further rate hikes on the table for some officials, guys i mean, you know, we talk so often, steve, about this broader issue of immigration and how that would be helpful potentially, is that still bandied about as a potential solution to one of the problems you just raised . It is bandied about as probably the number one solution, david, because as far as i know, we dont have the science for a woman to give birth to a person in 25 years or older so they can go to work and be part of the prime age work group. We could do more in the way of fertility, but that is not for economists to say for sure what they could do is in the way of immigration, those are actually people that would come in and if you bring people in and you train them and you make them efficient workers, then you also increase your average productivity in your country, which those are both good things. The data lately has been encouraging and good to see. Talk in a bit. Lets discuss the fed headlines and what it myaight mean for markets. Joining us chris harvey and economist jonathan pingle. Great to see you jonathan, we have manheim under our belt, and im wondering how youre thinking about cpi going into thursday . Oh, we think the fed is going to get another kind of piece of good news on the inflation front on thursday. Our expectation is that the core is going to rise 0. 19 , you know, so another round at 0. 2 and look like things are cooling. A little bit of a different mix of the components, but i think that the fed officials are generally going to welcome that. Its going to help indicate that the june improvement was not a one off and there are always reasons to caveat the data because its noisy, but i think this is going to fuel the soft landing narrative and be welcomed by foremc officials. Chris, i would like you to respond to that and fold in what weve seen happen to commodities and how that affects your yearend target analysis. Carl, i think thats right. I dont think were going to get much from cpi. I dont think its really going to change the equation i think the big thing right now is what the treasury did last week and the amount of issuance, surprise issuance they put to the market, and thats really roiled the rates market. We had the 10year above 4 . We had it making a beeline to 4. 25 the cycle high, and i think thats the real story at this point in time. Until we see rates calm down here, things could be a little bit touch and go nothing terrible, but youre going to have a lot more volatility because your yields im not sure are attractive enough to bring in the buyers. Is the volatility in the rates market in particular or just the overall effect that its had on equities, and do you expect to see more of an effect on equities in the weeks to come theres been a fair amount of volatility in the rate market that i think will continue what i was saying, what i was focusing on, was the volatility in the emergingquity market as we know its late in the summertime earnings season is more or less over, major over, and the macro begins to take over. We could see volatility really start to ratchet up a little bit higher, and so dont expect until you see rates begin to calm down, i dont think volatility in the equity market is going calm down yet. Jonathan g into the summer a lot of equity strategists were trying to draw our attention to external markets that might effect the market, at the time it was debt ceiling, i wonder if youre thinking uaw strikes, overall fiscal tightening, Government Shutdown, thats getting mentioned a bit this week yeah. Carl, we think about all of that, obviously, right you know, given the spread between whats coming out of the senate and house, odds of a Government Shutdown are rising, we do think that the resumption of student loan repayments will be a meaningful headwind for a wide range of households, and we are expecting the recent debt ceiling agreement to at least limit the expansion of federal Government Spending over the next year. There are headwinds coming up as we roll through the end of the year that could be meaningful. Well have to see whether or not the slowing were seeing in the labor market, you know, as much as it might be hawkish as steve was saying, there are reasons to think if that continues to slow, it does risk slowing too far and that kind of momentum and support for Consumer Spending waning as well, but certainly not out of the woods on the external influences on the u. S. Economy and the global backdrop does not look particularly great lately. Whats your take on the risks . You know, Morgan Stanleys mike wilson out kind of famously saying that high fiscal spending that underpin much of the Economic Growth this year is unsustainable. He basically had that he missed that as part of his forecast for the year, part of the bearishness hes had but he does believe that ultimately it will kind of surface and it could be a bad sign for stocks do you agree with that so, leslie, what i would tell you, theres a lot of talk about the fitch downgrade last week and look at 2011 and today, the macro is much stronger today than it was in 2011 and its much stronger than its been in some time. If you look at credit spreads. The two factoriess are credit spreads and claims the credit spreads hit a year to date and thats a powerful signal the second thing, weve been talking about claims going higher for some time and theyre still anemic until we see those two factors start to ratchet up you cant say theres a lot of stress in the economic picture, so, yeah, theres lots of risks. You think the risk is actually, you know, its interesting, the risk could be inflation comes back later on because we are seeing confidence come back, because we are seeing net worth going higher, because the consumer is stronger than expected right now it looks like the fed is done, but if the consumer starts to react sell rate that is one of the bigger risks the macro is strong and keep an eye on credit spreads and claims and your two major triggers. I was looking back at some of your notes in the summer, in june you did say we fear the feds rate pause will allow uber cap ai to go next level. Do you think thats possibly could we replicate that in the 4 q or going into next year . I think thats a big risk i think the probability of a rationale exuberance goes higher after the cpi print and after the market believes the fed is done because one of our big issues, what was going to stand in the way of things going next level was the fed and the fed being more hawkish, right, or potentially being more hawkish, weighing on the economy, that does not look like its going to happen as we turn the calendar, in september, what happens the calendar gets more exciting and there will be a lot more activity, but we go into Conference Season and Conference Season could stir up optimism and risk taking and we could see funny business in the back half of the year. Funny business. I like that. Chris, jonathan, talk soon thanks so much thank you as we go to break, lets get a road map for the rest of hour. Warren buffet trimming his energy exposure. Well break down the streets top picks after the break. Apple coming off its worst week, the stock for the year well have more with one analyst who downgraded the name and says there is a u. S. Slowdown ahead and paypal taking a big step into crypto. What it means for the company and investors. A big show still ahead stay with us look at the size of that gaaaaaaaaaaaap is that a goat . you talkin about me . Gaaaaaaaaaaaap i think this goat is saying gap. must be talking about the Expenses Health insurance doesnt cover. So whos talking about the money aflac pays to help close that gap . Gaaaaaaaaaaaap aflac aflac gaaaaaaaaaaaap its about to go down, baby aflac aflac stop that goat get help with Expenses Health insurance doesnt cover at aflac. Com keeping our eye on the energy space chevron in the way of berkshires results. Overall you have wti a little bit lower today. Some export figures saying the u. S. Continues to have surging exports averaging 4 Million Barrels a day versus 3. 5 million last year. Dow close to session highs, 312. Dont go away. Weve got your back, road warriors. Because we know youre picking up the pace, steering life at 10 and 2. Youre hitting the road. And were helping you get there with confidence. So skip the counter without missing a beat. Choose any car in the aisle. And be the boss of you. Go national. Go like a pro. Ah, these bills are crazy. She has no idea shes sitting on a goldmine. Well she doesnt know that if she owns a Life Insurance policy of 100,000 or more she can sell all or part of it to coventry for cash. Even a term policy. Even a term policy . Even a term policy find out if youre sitting on a goldmine. Call Coventry Direct today at the number on your screen, or visit coventrydirect. Com. Welcome back to squawk on the street. Oil hovering near fourmonth highs coming off six straight weeks of gains, but warren buffets Berkshire Hathaway trimming its chevron stake to 19. 4 billion at the end of june as the stock under performance on the year. Joining us to discuss how hes playing the Energy Sector, tortoise senior Portfolio Manager robert thank you for being here are you following buffet down the path of potentially repositioning some of your Energy Holdings . Everybody has to follow buffet, right. Hes been investing since 1941 hes a knowledgeable investor. Leslie, what were doing at tortoise we focus on the Energy Sector where we invest across the Energy Sector is really the question, and our focus has been on Energy Infrastructure because we just think you need Energy Infrastructure if youre going to have a. I. And youre going to increase Artificial Intelligence you need e. I. , Energy Infrastructure because a. I. Needs a tremendous amount of energy and electricity, none of that works without Energy Infrastructure. We like Energy Infrastructure because of the consistent, steady, Free Cash Flow that Companies Offer and they turned around and paid it back to the shareholders in big dividends. What specifically within energy and infrastructure do you like right now Something Like energy transfer, about a 10 dividend yield reported its results last week, growing its dividend every year if were in a period of higher interests for a longer cycle you need it. Companies start wait high dividend yield but also grow that dividend to the shareholders every year. Thats an example of one company thats doing that. The other company that we like warren buffet is participating in is energy or the ability for the u. S. To export more Liquified Natural Gas. Last month buffet bought or was in the process of buying additional interest in coke point, a large export facility shenear energy is the largest lng exporter in the world. We like that company because of its potential to continue to participate as the u. S. Really exports more and more Liquified Natural Gas across the world. There were some reports that texas power prices surged about 800 yesterday due to some extremely hot weather over there. How have the weather patterns impacted various distortions across the Energy Complex this season yeah. So the weather always does have an impact. Clearly weather boosts demand for energy significantly, whether in the winter or summer. Weather can have an impact on production side as well, both renewables but also oil and gas. When it gets really, really hot or cold, that often has an impact on the ability to produce oil or gas on a temporary basis. So, you know, obviously, with the renewable side, it gets really hot, maybe the wind doesnt blow that can have an impact as well were seeing more of the inconsistency. Now, where thats an opportunit you need more storage and Natural Gas Storage, and i think buffet mentioned in the past reports hes actually increasing Natural Gas Storage in some of his private facilities that he owns and operates. Thats happening really across several companies because you need more Natural Gas Storage to be able to draw upon that storage when oil and Gas Production may not be happening because of the weather. Robert, exxon and chevron, obviously, have not been good performers this year largely as a result of the performance of the key commodity. What are your expectations when it comes to the commodity side of all of this, mainly oil, not natural gas . David, thats a good observation. You know, its been frustrating for the Energy Sector because chevron and exxon and the s p 500 produce a lot of Free Cash Flow, some of the highest Free Cash Flow producers but are also valued at the lowest eps multiples. So thats been frustrating for the sector as we go forward, youre right, the decline in eps has been associated with lower oil price. As we look at the oil price we think in the second half of the year, Higher Oil Prices could be a catalyst why do oil prices go higher . Were likely to have an under supplied oil market. You have a decrease in inventories over the second half of the year, as Global Demand exceeds supply, results in lower inventory and higher prices. Weve seen that as weve progressed here in the Third Quarter. Finally, robert, taking a look at the Top Ten Holdings you have in your Energy Infrastructure total return fund, i just wonder, have you been thinking about any opportunities that have been created as a result of the Inflation Reduction Act, for example, and other focuses on degonization i dont necessarily see those names reflected in your portfolio . Well, so yes, is the answer first of all, when we looked at the Inflation Reduction Act, Carbon Capture is a huge opportunity and were looking at that very closely and thats theres a tax credit in the Inflation Reduction Act thats going to help accelerate the pace of Carbon Capture and sequestration. You need a lot of pipelines, you need a lot of infrastructure to do that. Some of the companies in our portfolio in particular will benefit if we are able top capture carbon and transport it and sequester it underground hydrogen is another area where the Natural Gas Pipelines we own in our fund good benefit if you blend hydrogen with a natural gas, you can put those together, that can be decarbonized and thats important as well once again you need the infrastructure to do that. Transporting that cleaner energy source. Robert, thank you for joining us appreciate it. Thank you. Turning to crypto, shares of paypal they are higher this as the Company Launches its own stable coin. Jim cramer was talking about it last hour. Lets get to kate rooney with some details. Hey, david, good morning. So paypal is launching a dollar denominated crypto currency. Its the first such move by a major Financial Services and could help whats been an otherwise slow adoption of crypto for real world payments Ceo Dan Schulman saying in a press release that the shift towards Digital Currencies requires a stable instrument both digitally native and easily connected to fiat currencies like the u. S. Dollar its been years in the making for paypal through a partnership with another Company Called paxos and the paypal usd coin as its called redeemable one for one with u. S. Dollars, backed by dollar deposits, treasuries or cash equivalence and paypal plans to issue monthly reports outlining the reserves its paypals latest move in the space. It allows people to buy and sell bitcoins through venmo paxos in february the s. E. C. Issued a letter alleging the stable coin it had previously registered was an unregistered security the company has pushed back on that, and has a statement out saying its unequivocally not a security but stable coins tend to make it easier for crypto currencies to set they happen faster than government issued currencies an the traditional Banking System and you dont have to price in the volatility that comes with bitcoin, something called spenders remorse where people have used bitcoin to buy something and have the price surge and feel like they overpaid there paypal is playing catchup tether is the biggest socalled stable coin. U. S. Based circle also has one for around 25 billion back to you. Thanks so much. Still to come this morning, the big tech playbook as apple shares come off their worst week of the year. Stock at a twomonth low this morning. Amazon near fresh highs not quite to fridays intraday high of 143. 63. Were back in two. You cant buy great conversations or moments that matter, but you can invest in them. At t. Rowe price our strategic investing approach can help you build the future you imagine. T. Rowe price, invest with confidence. Welcome back to squawk on the street. Im Contessa Brewer with your cnbc news update ukraine has detained a woman they say was plotting to kill president volodymyr zelenskyy. The woman is a russian informant who was preparing an enemy air strike while zelenskyy visited the Southern Region of the country according to the countrys Security Service nbc news has not independently confirmed that account ukrainian Officials Say she was caught trying to give the russians intelligence on zelenskyys movements. Outside harrisburg, pennsylvania, at least three people died when a bus with dozens of passengers hit a car and flipped on to its side overnight in heavy rain. State police say multiple passengers went to the hospital with injuries ranging from minor to severe. And a glacial floods in alaska sent a whole house into a raging river drone footage captured the moment it slipped right into the water below. Look at that flooding hit the States Capital saturday following a glacial outburst thats when trapped water escapes through cracks in a thinning glacier and you can see the result there carl thank you, Contessa Brewer. Checking on things in an hour into trading, dow up 300. Every sector is green. Banks are leading better than 1 , vix down a touch as we try to get back some of what was lost last week obviously, the downside reversal on friday was disturbing when you had apple down 4. 5. Speaking of apple, turn to tech and specifically shares of apple, which are off the worst week that theyve had in nearly a year fridays decline marked the largest loss in a day since september of 2022. And its worst day this year as well joining us to talk all things tech an maybe media as well, barton from rosenblat securities he downgraded apple from a buy to neutral, price target remains 198. I guess start there, why the downgrade . Well, apple is at a premium multiple on an absolute and relative basis, and the business is really taking a growth break, and i think those two things are hard to say that you need to overweight apple with that type of setup you know, i think over the near to intermediate term, youre kind of juggling some comparison on the iphone that will be a headwind and a tailwind, but i think the bigger issue is its hard to really imagine whats going to reignite growth at this place for apple. Youve got an iphone 15, which im sure will be a great device, but its hard to see that transformative to the demand characteristics of this company, and youve got some new ideas with vision pro and maybe an apple car, which will take years to play out. Vision pro i think is really interesting, but its not going to really meaningfully move the numbers northward in the near term 123450 you said its a growth break but hard to imagine what will reignite growth is it a really long break . Well, i mean, certainly youre getting out part of what my discomfort is i love apple and what theyve done, their execution, their vision has been tremendous, and its hard to bet against these guys i dont really see what i can put in my model to justify a 30 p e at this point or expansion from a 30 p e or take my earnings estimate meaningfully northward, so its a bit of a pickle right now well have to see how they play through this. Kind of pivoting to media if we can, barton, the Writers Guild of america negotiators met on friday with representatives of the major studios, didnt examine to an agreement, of course how much longer do you expect this to go on before it really starts to have an impact on the bottom lines of the studios . Well, look, i think that the duration of this is who knows. I think it will be darkest before the dawn when people really start to feel pain, is when you can actually get some type of resolution at this point. The studios are well cushioned in the near term obviously, the lack of spending on production helps their cash flow, their cash flow, investors want cash flow, so that setup near term, they dont feel a ton of heat today. They will feel heat when theyre unable to produce new originals for the streaming services and the subscriber growth tails off as a result, and i think for that to happen the strike would have to last into basically early next year. Its funny, we mentioned apple and then we go to media, but even though media in some ways seems to be an afterthought for the likes of apple they probably spend more, they can spend whatever they want, you talk about a lack of sort of seeing growth in their future, is it possible that they could come up with an app for the vision pro or do a deal with espn or, i dont know, move in some way that would conceivably answer some of your concerns about growth certainly thats possible you know, im not going to in my model an espn deal with disney, i think that would be great. I think that is, you know, hope over kind of substance to go there today. I think that it could happen i think that the, you know, the opportunity at apple is great, right. They dont have to pay themselves a 30 cut they have great promotion to their install base of, you know, over 2 billion devices you know, theyre well positioned i think that to frankly be a leading player in video streaming, in audio streaming, and i think theyve executed surprisely well on the video sign lionel messi coming to mls was the cherry on top of what theyre doing. So, yeah, i would look at that space maybe as snag could get me reinterested again. Meanwhile, we have paramount earnings after the bell. Disney later in the week talk about a lack of growth. Is there anything you can hang your hat on there . Valuations goat a level where it makes these stocks look inexpensive . Tell me. Yeah. I think that for the ktb exposed companies its hard to be comfortable. Youve got so much cash flow at paramount, all of their cash flow from their paid tv business today. You could imagine a breakup where there would be value for these companies. I dont think a controlled company like paramount is moving there soon, and i think in a breakup the value is really in the content library, not in the distribution assets or whats driving cash flow today, the tv networks and the streamers because i think that a buyer would shut that down and put the content on their own platform and a buyer could be a tech company, but the Tech Companies are loathed to own these kind of declining mature businesses on the tv network side. They dont want that and i think they want to invest in their own streaming brands, not some other creation from a media company. Not to mention the antitrust concerns that probably any deals, regardless, would raise paramount, they could just shut down paramount plus and probably deliver cash flow to the company, wouldnt it sure. Were losing a few hundred Million Dollars tonight when they report in that business and theyre moving towards a breakeven on the streaming and at some point in the next couple years, probably. The real question is not can they breakeven on streaming, but whether they can make enough money on streaming to offset the pressure on paid tv and that i think is a hopeful stance. The company has that stance. Im not really fully in that camp i think that paid tv was a great business model, but im not convinced the Competitive Dynamics and streaming are well positioned to replace the profits you got from that. Its part of a long conversation weve had on this show, of course. You cant just assume that incredible business model, the cable tv ecosystem, the last 20 years, is going to be replicate. Thank you as always appreciate it. Thank you speaking of tech, we mentioned it at the top of the hour big interview you dont want t miss this week, exclusive with the ceo of x, formerly known as twitter. Linda yaccarino, talking media, content moderation and media and more on thursday after the break the housing outlook with the ceo of tripoint homes as shares ride higher. Well discuss that in a moment this is cynthia suarez, cfo of gogo foodco. , an Online Food Delivery service. Business was steady, until. Gogofoodco. Go check it out. Whaatt . overnight, users tripled. Which meant hiring 20 new employees and buying 20 new laptops. So she used her American Express business card, which gives her more membership rewards points on her business purchases. Somebody ordered some laptops . Cynthia suarez. Cfo. Mvp. Built for cynthias business. Built for your business. Amex business. Welcome back to squawk on the street. Im dominic chu. Stocks are generally higher to start the week we are about session highs right now. We are taking a look at some of the action within Consumer Discretionary among the Home Builders all the Economic Data and earnings reports over the last few weeks have noted ongoing demand for homes dr horton, also pulte group and lennar remain near their alltime highs that each of them notched back in july now pulte group has been performing especially well up over 80 just so far this year and less than 2 away from the alltime record highs as well. Keep an eye on the Home Building trade. Carl, ill send things back downtown to you folks. On topic, dom stick with housing, home prices did hit record highs in 60 of u. S. Markets even as rising mortgage and Interest Rate priced buyers out. Our next guest says the market is fueled by, quote, persistent limited supply that is falling short of current demand. Here to discuss one of the largest u. S. Home builders tri pointe ceo doug bauer. Always good to get your take. Thanks, carl, good morning. I thought we were getting into an area where completions were ticking up, worker availability wasnt getting any worse. Are you seeing moderation in those trends no, not really. I mean we still saw very strong second quarter, continue to see a very steady july you know, carl, i kind of look at it in three different views, three different data points. Number one, the consumer has really adjusted to the new normal, and thats interest, Mortgage Rates in the mid 6s, low 7s our buyers through our Mortgage Company affiliate enjoy rates of 5. 8 the second quarter. The second thing is, its Pretty Amazing how strong the income levels are for the millennial and genzs our buyer profile at our Mortgage Companyover two third are millennials and genzs and making combined income of 193,000, loan to value of 82 very healthy down payments and then third point as you mentioned is the i mean its really a nonexistent resale market thats usually our biggest competitor i think the National Association of realtors reported 85 of households are locked in at or below 5 , and actually if you look at the data right now, the new Home Builders market share has gone from about 13 up to 33 . Everything is lined up for continued healthy housing market. So tactically in the meantime how do you navigate . I see some reports talking about your diversification of geography, maybe moving into the entry level first mover up markets, some of those products . We several years ago focused more on the entry level premium first move up. Its a great question, and as we noted, as long as rates stay at these levels, i, frankly, think our industry is poised for this next cycle i mean, there will be some Macro Economic speed bumps that will be out of our control, but at tri pointe were looking to grow both organically and possibly through m a to increase our scale. Were looking at further expansion in the southeast and the northwest, and we think its a perfect time to grow our business we have a very strong team and culture to do that. Newly constructed homes make up about a third of inventory today compared with the historical average of about 13 . To your point, current homeowners dont want to move out and forgo whats now deemed to be relatively cushy interests. How long do you see this imbalance continuing, and whats the catalyst that could cause it to flip . Is it just once Mortgage Rates start to go down ward . Leslie, its a good question and i keep debating that with my partner tom mitchell i continue to believe rates will stay elevated and the inflation component is more sticky obviously, if rates went back down to sub5 levels, that would free up more competition in the resale market, but conversely it would affordthe buyers even better interests than theyre seeing today. Its a good question as i mentioned earlier, i think as long as rates are where they are today, the Home Building industry has all the tools necessary to make housing very attainable. And how about the rental market obviously, rents in certain markets across the country have been extremely high, near historical levels. If those start to come down, how does that impact the, you know, Decision Making with regard to building and buying new homes as well well, what ive read, were not playing in the multifamily market and we have not gotten into the build for rent space as well, but rents are moderating from what i read, but still, the fact that the millennials and genzs really value Home Ownership and were seeing that, they stayed home maybe longer than we saw in the past but their income levels as i noted and their ability to come up with down payments, i think also is a generational wealth transfer thats going on as well i dont think the rents are going to be as big of an equation. And doug, finally, you mentioned m a, which sort of got my ears ringing. I would assume its what a lot of privately held, smaller builders, you know, what do you look at when you talk about expanding . Im curious, is it almost going to always be cash deals or ever think about using your stock well, our david, good question our Balance Sheet is very strong our net debt to cap is around 12, 13 , so we would look more for cash if we would do an m a deal whats intriguing to me is the credit markets, as you know, are praet well shut down, and so were monitoring the private builder most heavily because their source of capital has really dried up with the regional banks. Banks so, as we continue to develop relationships in the southeast or in utah or wherever, we will continue to look at those private builders yeah. Interesting. Doug, a lot of great intelligence and a tough market to read sometimes. Appreciate it very much. See you next time. Thanks, carl. Appreciate it. Very interesting. Still ahead, citis head of commodities as wti crude turns in six consecutive weeks of gains for the first time in over a year although slightly lower today. Are the risks to the rally here . Well discuss next hour at 11 00. Stay with us nice footwork. Man, youre lucky, watching live sports never used to be this easy. Now you can stream all your games like its nothing. Yes thats what im talking about. [ cheers ] running up and down that field looks tough. Its a pitch. Get way more into what youre into when you stream on the xfinity 10g network. Welcome back to squawk on the street. Ev maker lucid becoming the first automaker to cut prices, cutting the price of air luxury sedans by 12,000 over the weekend, amid rising competition in the oechlt v space. Shares are off on the 52week high this particular price going to take you back to late june, but definitely tying into what we saw out of mannheim today. That is used cars are prices are down its driven largely by evs in fact, yes, as you say, used car prices down more than 11 year over year in july that is according to the data that carl was just citing. Phil lebeau joins us with a bit of a breakdown on whats going on with used cars. Maybe we can talk lucid afterwards and tesla, phil. Yeah. Well hear from lucid later today. Lets start with the used car data we are seeing prices come down this is the latest data coming to us from cox automotive, which has the mannheim used vehicle index. Down more than a point compared to june. Down 11 compared to the same time last year this is the fourth straight month we have seen used prices fall here in the United States so, this is the cooloff we expected part of this is because, as carl mentioned, whats happening with ev prices. But a bigger factor is overall, as you take a look at the larger auto dealer stocks, what youre seeing is greater supply out there. Some of this is because the new Vehicle Manufacturers are increasing their production. As they have done that, it gives more choices to people who are out on the lot bottom line is this, guys, we expected a cooloff in used vehicle prices thats what were seeing dont be surprised if we see this extend for a few more months phil, specific to lucid and what the expectations are, i dont even know where their margin could be given the price cuts were talking here. Yeah, i think the margin is the least of the concerns for the investors tracking lucid when the Company Reports today after the bell, david, the question becomes, will they stabilize expectations in terms of production . This is twice now that their production and deliveries, two quarters in a row, they came in light of expectations. Theres got to be a stabilization there. If theres not a stabilization there, well, that will put further pressure on the stock. Yeah. Well, there hasnt been for some time i mean, as you pointed out in many times, these companies burn an awful lot of cash, dont they yep yep. And, remember, the saudi fund, the Investment Fund out of saudi arabia, they own more than 60 of lucid that has people saying, now, wait a second, do i want to buy into lucid right now do we think lucid will be publicly traded . Will there be a premium in the future if saudis decide they want to buy all of lucid a lot of questions there for the individual investor, this is a really, really tough one to say, ive got confidence in where lucid will be six months or a year from now. Yeah, private Investment Fund, the pif of saudi arabia. Any thoughts on the cfo departing after 13 years at tesla . Theres high executive turnover rate there. Look, hes been a loyal foot soldier to elon musk it may be that he has said, you know what, ive had enough ive been doing it for 13, 14 years, been cfo the last four years. Hes sticking around for a while. This is not one of those immediate departures where you know something happened between the executive and elon i think this may be a case where zach is like, okay, its time to move on and do something else. Also master of coin not sure who gets that title now. Phil, thanks for scanning the landscape, of all things auto. Appreciate it. Quk lebeau. Sawon the street continues right after this efunds help with your erc tax refund so you can improve your business however you see fit. Rosie used part of her refund to build an outdoor patio. Clink dr. Marshall used part of his refund to give his practice a facelift. Emily used part of her refund to buy. I run a wax museum. Let Innovation Refunds help you get started on your erc tax refund. Stop waiting. Go to innovationrefunds. Com you really got the brows. feel the power of osteo biflex®. Taken every day, its clinically shown to improve joint comfort in 7 days, with significant improvement over time. what do you see on the horizon . With significant improvement over time. Uncertainty . Or opportunity. Whatever you see, at pgim we can help you rise to the challenges of today, when active investing and disciplined Risk Management are needed most. Drawing on deep expertise across the worlds public and private markets in pursuit of longterm returns. Pgim. Our investments shape tomorrow today. Hows the chicken . The prawns are delicious. Oh, i have a shellfish allergy. One prawn. Very good. Did i say chicken wrong . Tired of people not listening to what you want . Its truffle season ah thats okay. Never enough truffles. How much are they . Its a lot. Oh okay im good, that its like a priceless piece of art. Enjoy. Or when they sell you what they want . Yeah. The more we understand you, the better we can help you. Thats what u. S. Bank is for. Huge relief. Yeah. Welcome back to squawk on the street. Im Carl Quintanilla with leslie picker is the pause set up for a pause . Chief strart gist will join us. And citis head of commodities, ed morris, with us. Later, an exclusive with the ceo of sunova, first on cnbc after earnings lets take a look at the markets, about an hour and a half into trading here green on the screen. Nasdaq the laggard here. The dow up more than 300 points. Se