Chat box while google teases new ai. Inflation data year on you 2. 4. Thank you to weinstein for the great interview. Its because the revision is so steep. Up. 2. I never want to challenge numbers. People work hard to do them. When you have that kind of revision, its not what you get at amazon or sales force. Meaning what . Theyre not using enough who would come up with a product that could be that wrong. Do you have any product in your life that could be that wrong . Its all survey based. Other Companies Know how to do surveys. Theres too much on the line. You believe as a result what, that you cant believe the current numbers . No, i cant. Im saying that the bond market is indicating the stuff doesnt matter. I dont ever want to Say Something doesnt matter. The only numbers people base policy off of is pce. The unemployment number at the beginning of the month. When i look at these numbers, what are they worth . How could you be so wrong . Thats a gigantic delta. My take is people are saying the press is going to make something of it. Its not really a number. Spend a little time reading this data collection, the release here in terms of the ppis and price data. They periodically update the ppi sample as survey respondents to better reflect Current Conditions whenthe product makes an industry shift significantly and to spread reporting burdens among smaller firms, jim. Like when they took out housing when it was too hot in 1982. I dont want to belabor it, what i spent most of the time trying to figure out is why Interest Rates didnt go up. The only thing i can come up with, if you have this kind of revision carl, think about all the companies we follow. Think about a google or an amazon. You think about service now, salesforce, if they came to you, youre bank of america and marc benioff. Guys, the numbers we came up with last month, its plus two, its actually minus one. You know what they would say . Youre fired. The correlation between ppi and cpi is not that strong. Right. Youve been active in alerting the fed on x to things like apparel where there is minimal price appreciation. We dont know whether temu is in. Great fan of the fed, amazon is a great fan of the fed. If you dont like at what china has done in terms of keeping apparel down, you wouldnt think apparel was so hot as it was last month. Does the fed include . We dont know. Again, theres no transparency. Theyre only including apparel bought from gap . We dont know. Were making an assumption that it is inclusive broadly speaking, everything including whats available to you online through teemu. I look at temu and it costs more that ship it than the stuff. Then maybe the fed is looking at quality. I know jay powell how many threads is that . He counts those threads. Jay powell is smarter than these numbers. Well hear from him in about an hour. Jay powell is doing his best to take these numbers down. Its going to be corporations that take things down. Wet cant get housing down. If rates are so high, they dont want to build more houses. Looking at an outfit like Stanley Black decker. Investing club. Yes. Thank you. Of dewalt. They have Gross Margins going up and big inventory problems. If the inventory came down and you bought stuff more cheaply. I think you have to compare these if you look at autonation, theres not enough supply. So, therefore, used cars havent come down in price. Everything is understandable except for insurance. Insurance is something that i cant figure out how it stays high. The Justice Department investigates apple because their phone is so good. Therefore, its unfair. Speaking of inventory, watch depot today. Comps a bit of a disappointment. Inventory down yearonyear, jim. Did accelerate sequentially, up seven. I think home depot will say spring fed cuts, i was happy inventory went from 25. 3 billion to 22. 4. Everyone is kind of stuck because the renovation comes from when you buy a used home. I said existing home sales were really bad yesterday. You dont renovate a new house, right . There are not a lot of new houses being built. The fed is caught in this curious notion, because Mortgage Rates are so high, youre reluctant to give up your low mortgage to go buy a house. You dont need to reinvent your house, renovate, unless theres been a lot of storms. Which there have been. The longer you stay in your existing home because youre not buying a new bun, you have to do certain renovations. Theyre playing for time, absolutely. There will be renovations being done. If you have a lot of storms, you might decide, im tired of wood on the outside. Like i did. It looks like wood but its not wood. Recycled. Once its done, i dont need to do it again. The threeyear stack on depot goes negative because 2021 in which everybody was doing exactly that falls off the stack. These companies are all challenged because these are the ones in the crosshairs of the fed. When you go and look at them and say why arent they doing better . They raised rates very quickly. Those guys are hurt. If rates go down, they wouldnt be hurt. But maybe then youd be like london, uk, where wages are going up. Its very difficult if youre the fed. You really want to solve the rent which we cant because of immigration. You want to solve home, but the Home Builders are not going to cooperate. You want to solve insurance, but the Insurance Companies have not cut rates. Why havent the Insurance Companies cut rates . Because they dont have to. Certainly. If you watch any sports broadcast, you would assume theres competition amongst auto insurance, for example, given how many are out there. Apparently theyre all not willing to compete that much. Progressive uses Artificial Intelligence to figure out what the exact moment price i know theyre the ones most advanced with ai. We know Warren Buffett said the blond guy. Jamie. Thats neither here nor there when that comes to trying to fight between progressive, state farm, farmers, allstate, and ge geico, of course. If they went away, all broadcast television would cease. Back to the depot. Just to go through the numbers, they got the grossman injury anyone bummer 44 basis points. Similar to last quarter to that threeyear running total that carl was talking about, traffic declined 1 . It was down 1. 7 last quarter. But its and lowest buyback since 2020. And yet they have cash, dip in the yield is okay. I wonder if lowes is going to do it be better. They have more do it yourself than home depot. We know from dewalt, the 100th anniversary, the contractors do better than the doityourselfers, bad for paint, so many different aspects of aisle by aisle. What do you think is going to happen . This is what happens if you raise rates. It worked. It made it so these guys cant raise prices. Except for insurance. My geico, i think its double not double. I didnt figure it out. I just paid the bill. I did the same with chub. The homeowners stuff its insane. Well see if we can get relief in tomorrows print. Meme stocks today, gamestop, amc surging again, up trim digits. Jim, you were all over amc. They had market offering, they had it already planned which is the smart way to do it. Did adam aron have any stock left to sell . No. Why not . Because i dont know the answer. Yeah, he does and selling one of those stories where its too goodto check out. That was the right answer. You dont know the answer, i dont want to hear from you. I dont know how long this is going to go on. But i know how it ends. It ends badly. Options activity picked up late last week. Who knows about Roaring Kitty and what keith gill did there or didnt do. All of it is perfectly legal. Portnoy. There are people buying the options now to your point. Maybe theyll do incredibly well. Already today they are. Yesterday the volume was enormous as well. Nothing to do with stocks, second time ive quoted squawk because im a team player. Is it investing . Does it matter . He doesnt think its right. The problem is this whole game has been Caveat Emptor from day one, from day one. Market value is going to double from 9 billion to 18 billion today . Its absurd, ridiculous. Anything else you want to add there. Its happening. What i would do if i were gamestop. Theres a law about when you buy back. If youre gamestop you could tell a billion dollars worth of stock and get out of the gaming business. Play the tape three years ago when you were saying the same thing. Thats the moment i ripped out my catheter. The great moment where i cant read my twitter. Back surgery. I crawled into i have to do mad. He said no, mad is gone that night. The percent of shares sold short is a fraction of what it was then. This is just people having fun. I dont begrudge them one bit. If you want to get up at 4 00 a. M. , buy it at 40 and have it go to 60, i love you. I have no problems with that. What does it matter . Reminds me of archegos, too and bill wong. Hes on trial. If agagensler where to say i dont like this has anybody heard from gensler . Hes the law. Working on the fireplace. Cleaning it out and getting ready. I think portnoy told you he was doing it, could have done it alongside portnoy. Portnoy shows up in everything. Nothing going on that he doesnt want to be involved in. Buffett wasnt involved but portnoy was. In this case portnoy is the man to see. Stunning. Game m stoks market value is going to more than double. People hated me when i said a bunch of old fuddyduddies. General counsel wanted to know what i knew. I said itsunder valued. I rested my case. Hey, how is the defense doing over there downtown . I wouldnt know. Good answer. Thank you. A lot of i dont knows this morning. I like that. Notice Amc Entertainment and amc when we come back, chatgpt got an upgrade. Well get a closer look at the big unveil from yesterday. Talk more about google io today at 1 00 p. M. Eastern. Well t miaewgetoed ns involving netflix, amazon, our parent when we come back. Its w with a speaker in it thats right craig. A team thats highly competent. Im just here for the internets. At t its superfast. Reliable. You locked us out . arrggghh ahhhh solutionoriented. [jenna screams] and most importantly. Is the internet out . Dont worry, we have at t internet backup. The next level network. I sold a pillow you know whats brilliant . Boring. Think about it. Boring is the unsung catalyst for bold. What straps bold to a rocket and hurtles it into space . Boring does. Boring makes vacations happen, early retirements possible, and startups start up. Because its smart, dependable, and steady. All words you want from your bank. For nearly 160 years, pnc bank has been brilliantly boring so you can be happily fulfilled. Which is pretty unboring if you think about it. Its a beautiful. Day to fly. Wooooo and theyre all coming . Those who are still with us, yes. Grandpa whats this . Your wings. Light em up gentlemen, its a beautiful. Day to fly. Open ai launched gpt 4. 0 which the company says the reason in realtime. Demo highlighted how the chatbot can hold a human like conversation including math tutoring and even showing emotion. Take a look. Whats the first step i should take to try to solve this . The first step is to get all the terms with x on one side and the constants on the other side. So what do you think we should do with that plus one . Im going to try to subtract one from both sides and see what i get. Great idea. Chatgpt, this is what i ended up with. How does this look . It looks perfect. Youve solved it. X equals one. Nicely done. I wrote one last thing id love for you to take a look at. Of course. Id love to see what you wrote. Show it to me whenever youre ready. This is what i wrote down. What do you see . I see i love chatgpt. Thats so sweet of you. It looks like youre feeling pretty happy and cheerful with a big smile and maybe even a touch of excitement. Whatever is going on, it seems like youre in a great mood. Care to share the source of those good vibes. The reason im in a good mood, is because we were doing a presentation showcasing how amazing and useful you are. Oh, stop it. Youre making me blush. Speaking of open ai, the Company Topped the cnbc disrupper 50 list for the second year in a row, the First Company to do that. Check out the full list at cnbc. Com disrupters. Jim, twice as fast, half as expensive. I think we keep saying breakthrough after breakthrough. I think its only a matter of time before davids world is true which is it can skew. It can easily skew and say, you know what, youre being ridi ridiculous. Yeah, it could. It could be cynical. Right now its not cynical. So reminiscent, now, the movie about ten or 11 years ago, her. Joaquin phoenix and Scarlett Johansson. He falls in love with Scarlett Johansson as the voice. People are going to like it. I remember when Mark Zuckerberg was saying you can go into the metaverse and teach. In real time, potentially tutoring math. You can only start to begin about the things that will be displaced as a result potentially of the advancement in technology. By the way, alphabet is going to come with its own. There will be any other number of potential entrants. Chatgpt has been joined by many other incredibly well capitalized companies that are similarly focused on these kinds of interfaces. Where are we going to be in a years time, twoyears time, i talked about the rate of change only increasing and what thats going to mean for all of us. I believe well look back on this as the last period of time when we werent connecting to the machines in the way we will be in the future. Let me give you a positive use case. When you used to call a story, youd get someone helpful. Do you have any tylenol extra strength. Theyd come back and say, we do, would you like me to save some. Now its press one for this, two for this. Were going to go back with these to where we have someone. We dont care if its not human, yes, we do have it. It will be terrific because we used to love that. We used to love that. Then we lost it. Now theyre bringing it back. Theres a positive use case. Not an actual human being. Its going to happen. If youre at a call center, youre going to be out of a job. Even though last night you said this is not happening fast enough for the fed in the near term. No. Thats the problem. The fed wants things done now. In the meantime, this is going to be down two years from now. The fed is not going to be able to say, you know what, here is whats going to happen. These people are going to lose jobs. Thats going to keep wages down. Lets just roll with it. No, it doesnt work like that. Later today, dont miss a major cnbc exclusive. Deirdre bosa will talk to Sundar Pichai at 4 woo 30 eastern time. Cramers mad dash coming up after the break. Dont go away. It is a packed morning. Futures hanging in there. Everything between ppi, gme, white house tariffs, google io, well get to all that and more. Opening bell in 4 30. Lets get to a mad dash. Give us the two names. Owings and minor, the ppe company. Thats the nations best. The two giveaways that the president gave you, i could do first solar for seven and do Texas Instruments for legacy chips. The hardest to get are those two companies. Theyre both down almost 3 for the year. You did it in shorthand. Explain what youre talking about. Big, big tariffs being put on medical products by the president. One of the tariffs is going to be on rubber, medical and surgical gloves. And another syringes and needles. So just buy the company. The biggest problems have been china. A very big win for american manufacturing. We dont know where it ends, but it ends there. Theyre both very fine companies, very down and very inexp inexpensive. Go for it. [ bell ringing ]. At the big board, dewalt, the tool maker. Jim with will talk o to Stanley Black decker ceo tonight. [ cheers and applause ] theyve done a remarkable job. A terrific company. Meantime, jim, 5221. There has been discussion about better breadth in the market. Yes. Weve got a lot of different stocks i have calls for the lightning round. So many stocks and so Many Industries benefiting from seeing this big infrastructure money. David, data centers may be the greatest story never told in terms of how much is being made from every company and connected to. You can do the entire somebody should try to structure something the entire chain right up to the reits that own the data centers and how that lo looks. Eaton makes the electrical equipment. Thats why we own eaton for the travel trust. Incredible how much money is being made. Speaking of data centers, aws with the announcement that adam sal lipsky is going to step down. Matt garmein will become ceo. Ive got to sal lewd adam. He helped build the web services. He was recently at tableau which was bought by salesforce. Stayed at salesforce, went back to amazon. Amazon web services remember had gone from high teens to almost singledigit and then, boom, right back, as the company stopped optimizing. Hes fantastic. Also, can i say, david, one of the most humble great guys ive seen in the business. Did not have an opportunity to get to know him. He apparently is going to take some time to get to know himself. He does say hes going to be stepping down, appropriate to make a transition, spend more time with his family and recharge and also create some mental free space to reflect and consider the possibilities. Can i Say Something we all should do. This is not like ive met his family. So nice. His family is so nice, id like to spend time with them. Know what i mean . Got it. A good family. An amazon story and i see andrew sorkin. What can i say. Within amazon, theres news of additional nfl games. Bundling news. From our Parent Company, announced during the Moffett Nathanson conference going on. This announcement related to new streaming bundle that would kof peacock, netflix and apple tv. Streamsaver is peacock, netflix and apple tv at a vastly reduced price than anything in the market today and be available to all of ours customer mers. Weve been bundling creatively for60 years. This is the latest iteration of that. Starting to see the rebundle i ing the price on the bundle yet to be determined. You heard Brian Roberts say its going to be priced very aggressively versus other things in the market. You want to offer as many options as you can to get as many people using the broadband as much as possible and the need for it we know is enormous. It is sort of recreating what we all had for the last 25 years, namely a bundle of different entertainment services. Sports and news continue to be the interesting components here as theyre providing sports programming in some form. Then youre left with news. What else i dont know if thats enough to keep people subscribing to the cable bundle. That said, the economics may not be that different, although youtube tv, the most successful with 8 million subscribers, you can have it anywhere. Youtubes now 10 of total viewing hours. Interesting to see netflix included here. Streamsaver is what theyre talking about. Pricing to be determined. We have the sports between disney, fox and warner bros. Discovery as well. That is going to be debuting i think in the fall of this year. So you do and are starting to have proliferation of potential bundles for customers to make their decisions, all of which is designed as well to lower churn because people will click on, watch something they really want to watch and then click off which can make it difficult to build other than netflix and to a less ser extent but significant one, disney plus to build longterm, profitable subscribers. Nothing moves the needle for comcast. Nothing. They have to do something much more major. Comcast, the issues there are broad wand overall. We talked about housing. Until people start moving again in a real way. If thats the case i would rather buy Stanley Black decker. And or fixed wireless comes out of capacity in some way. Tmobile is telling me they wont. And verizon. You look at the subscriptions added by both of those Wireless Companies when it comes to fixed that brings broadband to the home. Then theres the prospect of starlink at some point as well. Spacex keeps putting up more and more satellites. Jim, thats the problem. The Parent Company of this network, i dont feel free to say much more about it other than i work for the Parent Company of this network. Free cash flow, buying back stock, great balance sheet. Ill say that. Has that worked . Leverage ratio very low. Has that worked . I ask you has that worked . Not lately. What have you done for me lately, partner . Im always here loving you. Theres that. I love it. Its not about app loving. Meantime, jim, well keep our eye on the dynamic that has row introduced itself into the market and that is memes. The pe multiple on gme is 1,000 times. Look, ryan cohen, he could reirn vent this company, its had flat revenues for years. Why not go into Something Else . Youve got a new market cap that is remarkable. Why not take advantage of it. Youre now bigger than best buy which should have bought you, i guess if it was really worth anything. All i can say is this the a great opportunity to be able to sell a lot of stock. They dont need the doesnt matter. This model they currently have is not working. Youve got to be in a position to sell at any possible moment, be able to sell stock given this can happen cvs is paying no attention. Why not offer right now 100 million shares at 49, just do it. Reinvent the company, turn out to be a remarkable new company. When do they get another shot at it . We should point out the market cap high during the meme stock craze of a number of years ago i think was 22 billion, roughly. And so were only 4. 5 billion away from that. And up 120 it would have come very, very close to an alltime market cap high for the companys stock. So lets sit down. Gamestop is worth what it was worth before this, before hello kitty. Its worth this, and, therefore, the company should sell and that would be fantastic. The company should take advantage of the capital markets. I love capitalism. And say, you know what . Were going to be the Single Source of take two. There are certain mechanisms that they have to have in place to be able to sell stock. What im saying is you challenge the sec and do it. The sec comes in and says you shouldnt have done that, but well make you pay 100 million fine. Okay. Is gensler going to say im breaking that trade . At the market . I dont know what gensler is going to do. Sorry to be proactive. Are they back in the office yet at the sec . That i dont know. A lot of Companies Like walmart are making people go back. A journal piece today about corporate layoffs, asking the majority of workers to return to the office the majority of the time. Im going to say that story is true, but its not anything having to do with whether the company is doing well or badly. I think this is a moment where theyre trying to inflation fight. If youre an inflation fighter as opposed to lover, youre not going to be able to blow out the numbers. Walmart is a brand new walmart. Doug mcmillen has had a sense of the psyche of the United States including much better house brands. Kroger does, too, kroger is involved with that crazy acquisition. We talked about new private labels. We havent mentioned kfc and oscar mayer. How do you like that . That is a core product of that pathetic its got to be only private equity. Theyve done so badly. Theres another company, they need a meme invasion badly. Look at that. Yeah. That was not a great deal coming in criticizing those companies. It was 3g and Warren Buffett together remember give me a longerterm chart there. Can you . Starbucks versus khc on the fiveyear. Have you looked at you want to do starbucks versus comcast . I just was looking. I thought the comcast news was fantastic. Thats all im reacting to. It was comcastic. Whoever has done a deal with apple . That was great. With netflix, too. That was a great deal and nothing happens. I said, oh, my god, theyre doing a deal with apple. This is just the beginning, only the beginning, only just the start. I like that song. Thats what im reacting to. What does the market really want here . Takes time to manifest itself into lower term, to davids point earlier. Right. Youre making me the fall guy here. You are the fall guy. Its your fault. Getting great reviews, by the way. I love emily, not that i love her personally. Just a patsy. Look at that. The apple deal. Thats got to move it. No one talks to apple. Apple does everything by itself. I know. Alibaba shares are down 5. 5 . What is that . I dont know. Its below the line. The loss they had was net income related to market to market net loss in its investments. That shocked people. Many chinese shares. Their sales were up. Revenue up 6. 6 yearoveryear, and the key platforms were up as well. Returned at least to some level of growth. Was their Cloud Platform up . No. I mean the sales platforms. Not the cloud. They did buy back 4. 8 billion in the First Quarter of stock. Annual target is about 12 billion u. S. Dollars and repurchases. They also i think they up sized dividends as well. I heard a couple of more or less positive reviews. Headline number was certainly down, below the line, not related to the growth when you look at home depot, when you look at alibaba, it crossed around 635. The stock was looking like it might go either way. And then it craters. The only one working today are the ones that should be up, yuan holdings. I know they get gravel in your shoes. Youre not the core consumer. I put my squeaky ones away and never wore them again. 38 cents, people looking for 14 cents. That is a blowout. We didnt talk about the steel winners. You can say newport but they dont even make the steel is there really a lot were not taking stuff in from china in the country. The evs, compared to what europe exports, the way of evs. No. Bloomberg called this whole thing a rounding error. Some would say its fatuous. Far be it for me to say anything is fatuous. You pointed out the two biggest beneficiaries, dickinson chinese syringes have always been here. Owens, the ppe, they tried to get into china. They did a very good job wrecking the industry. Those are two big winners and deserve to be up. Not affiliated with apple or netflix, but theyre up. Everyone wants amestop. Yes, they do. Thats all they want. Ive got two dogs. Im renaming one, tonys birthday. Hes gamestop. Ive got to tell you, ragu, hes amc. Thats happening in a few minutes. Those poor dogs. Do they even know their names . They know chopped sirloin and filet mignon. You want me to give them tbone . How about a cowboy cut . Its good to be cramers dogs. This one dog was small. Do they play with the cows . Not yet. How do they feel about the cows . Thats interesting. They nip the cows. The two cows are harmless. One is about to give birth and then well have three cows. Three cows. So ill have to find that cow will be named coss. What value added do we have on gamestop . Thats why its a frustrating i interviewed dickinson twice. I really like him. I have nothing on gamestop. Im sitting here saying i just dont have value added gamestop. You dont have to talk about it. If you dont talk about it, thats the elephant in the room. Lots of other things to talk about. If they did a deal with apple and netflix its true. Bundle. Im going to bundle gamestop with amc and starbucks. What do you think . Youll get coffee when you go to the movies and you can game. How about tim hortons . Popeyes is crushing kfc. I didnt know that. Crushing. Is there value added . Yes. Ppi under our belt. Well look for cpi tomorrow. Walmart on thursday. As for bonds, hanging in there, again, with those negative revisions, tenyear lower up now to 4. 46. Stay with us. And when i got there, they have the sushi this is clem. Like sushi classy clems not a morning person. Im tasting it or a night person. Or a. People person. But he is an i can solve this in 4 different ways person. And that person. Is impossible to replace. You need clem. Clem needs benefits. Work with principal so we can help you help clem with a retirement and benefits plan thats right for him. Im short but im. Im confident. You know . Let our expertise round out yours. Ga, the advanced form of dry agerelated macular degeneration, can irreversibly damage your vision. It can progress faster than you think. When ga threatens your eyes, take a stand. Slow ga with syfovre. Syfovre is an eye injection that was proven to slow damaging lesion growth over 2 years with increasing effect over time. Its the only fdaapproved treatment to slow ga in as few as 6 doses per year. Dont take syfovre if you have an infection, or active swelling in or around your eye and retinal detachments, severe inflammation of vessels in the retina which may result in severe vision loss, wet amd, eye inflammation, and an increase in eye pressure. Most common side effects are eye discomfort, wet amd, small specks floating in vision, and blood in the white of the eye. Tell your doctor right away if you have any side effects. Every moment counts act now to slow ga with syfovre. Ask your retina specialist about syfovre. Fed chair powell set to speak overseas at the top of the hour at the foreign bankers amsterdam. Comments as he speaks with an official from the ecb and lisa cook on the tape and jeffrey w ith later today. Doup 50. Well get stop trading with jim after a break. , tailormade for trader minds. Go deeper with thinkorswim our awardwining trading platforms. Unlock support from the schwab trade desk, our team of passionate traders who live and breathe trading. And sharpen your skills with an immersive Online Education crafted just for traders. All so you can trade brilliantly. A slow network is no network for business. Thats why more choose comcast business. And now were introducing ultimate speed for business, our fastest plans yet. Were up to 12 times faster than verizon, at t, and tmobile. And existing customers could even get up to triple the speeds at no additional cost. From the company with 99. 9 Network Reliability and advanced cyber security, its ultimate speed for ultimate business. And its all from comcast business. Jim and stop trading. Well, i think that know vo nor tis talking about how theyre going to do fatty liver and heart risk. You know what, even if you dont lose weight its great for your heart. This is going to put pressure on the insurers. Thats the holy grail, if you get the heart and cardio, not weight loss, viewed as being vain, this is cardio and thats why. Lilly goes down and novo nordisk, theyre overseeing the same compound. Thats about as stupid as the wood that is sold at home depot, although i have to be careful because orion stranboard may be smarter than the people buying these things. Novo nordisk and lilly should benefit. Every time novo nordisk does good buy lilly. The same formula situation. Doesnt the advent of ai on productivity and advent of these on Public Health make you optimistic about the future . Thats why i say its 18 months and two years. I need jay for time. Look guys, the cavalry is coming. Its not i mean, i think were in a fort, not like custard. That last stand he made, suboptimal. How about tonight . I have Stanley Black and decker a company that has a division thats 100 years old that is killing it. Thats for the professional. Well hear what they have to say, and i have to tell you, thats a gross margin story, not a sales story, but because they dont have the big sales because look at home depot and lowes and the independents. Theres not enough, but they get the Gross Margins up to 30 and 35, that stock will keep going higher. I love you, david. I love you too, jim. Keep being you. Dont worry about the memers. During the break i expressed i want to be more valuable to people and feel like if this is how you make big money i cannot help you. This is the tenacity that makes us appreciate you, jim. See you at 6 00. Thank you. On mad money. Monitoring for the fed chair set to speak in a few moments. Dont go anywhere. Good tuesday morning. Welcome to another hour of squawk on the street. Im Carl Quintanilla with david faber and leslie picker at post nine of the new york stock exchange. Sara eisen is on assignment. Few moments from the fed chair making fresh remarks at the annual meeting of the Foreign Bankers Association in amsterdam. As soon as we get those well bring them to you. Markets looking through some of the internals of ppi today. Ran hot month on month, negative revises and one interesting element as you can see the 10year at 4. 45 is a lot of compone bents that feed into cpi that we saw this morning werent that hot and hope tomorrow might be, some have argued, a friendlier number. If you look at the read through to the various sector, real estate the top performer, the market isnt as concerned necessarily about rates. Youve got financials in the green, materials, industrials and utilities, whereas communication is the biggest laggard. Communication services, the biggest laggard which suggests kind of maybe some profit taking in big tech and other areas of communication services. Interesting in terms of the fed chair this morning. I know a lot of people in the banking world will be clued in to see if he has any fresh comments with regard to Bank Regulation because that has been a key topic of conversation. This would be a platform for him to discuss whats going on with that. The latest on that. You know, keep an ear out for those types of comments. Hes asked about that at the last presser and talked about some of these deadlines that are fast approaching. Well keep our eyes peeled for comments on that as well. Meantime, reaction to the latest inflation print and what it means for the fed and for the markets. Lets bring in ed yardeni, president of yardeni research. Youve written in the last few weeks about maybe the risk of a market melt up returning. Where is your head on that right now and how do some of these data points feed into it . At this point, my base case is we have a fairly leisurely bull market. I have been targeting 5400 by year end and were awfully close to that already. Im not going to change that. I think, you know, we could stall out here a little bit, but all in all, things look pretty upbeat. I mean the numbers this morning were great. Ppi was revised down as leslie pointed out. There was an outlier there in Portfolio Management fees. I guess wall street, the bull market is up and theyre charging higher fees. The ppi numbers are fully consistent with the cpi inflation continuing to moderate towards 2 by the end of the year and, carl, one more thing, the National Federation of independent businesses, the Small Businesses they still got plenty of job openings. They cant find people. I know, too, as some have worried about certain elements of the u. S. Consumer cracking, you keep returning to the theme of the generational wealth that has been built up primarily among the boomers and with some of their responsibilities now in the past, do you think theyre going to spend it all . Ive got an inside track on that, the baby boomer. Im a baby boomer, and im certainly helping out, ive got five kids, i dont know how that happened, yes, i do, but anyways, the reality is, i see myself and my friends helping their kids. Theres a lot of kids still living at home. Even if they get a job theyre not getting paid enough to afford rent, so were seeing a lot of intergenerational transfer. The baby boomers are having a blast. The ones retiring have no mortgages, no tuition to pay. Theyre traveling and going out to eat, theyre checking up with the doctor every now and then just to make sure they can climb mon chew picchu. I was in mount mon new picchu as well. I dont know how to transition. Let me go to the budget deficit because something youve been focused on as well. Yes. Well talk about it now and well talk about it at a point in the near future. Are we ever going to get to the day of reckoning where interest costs become a burden as a result of higher rates it does force politicians to do something about the structural deficits . Were at an unsustainable path. Everybody seems to describe thats way, and i agree with that. The scariest thing right now, of course, is the way Interest Payments are going, up to over 800 billion within a month or two they will be bigger than defense spending on a 12month basis and by the year end were probably spending a trillion dollars just on paying the interest. The government is going to be borrowing to pay interest. Thats not a Wholesome Development for anybody in a financial situation like that. So the short answer is, were probably going to need down the road some sort of debt crisis that wakes up the politicians because it is a problem that was created by politicians and its a problem that can be solved by politicians. Israel is simple. You have to cut back on outlays and increase revenues. Theres no constituency for that at all at this point. What would ultimately kind of garner that support from politicians . Would it take some sort of severe volatility, maybe even a crisis in the treasury market in order for them to really kind of sit up and Pay Attention . Well, i think we had a glimpse of what could happen back last year during august and september and october. We had the bond yield zoom up from 4. 25 to 5 in a heartbeat. And that was largely because some auctions didnt go very well. Im watching the auctions very, very carefully, and if these auctions start to get real sloppy, it would indicate that the bond yield could move higher. My old friend the bond vigilantes backed off when we got to 5 . Now were at 4. 25 . Were not out of the woods in that regards. The good news is inflation is moderating and the economy is growing and so the fundamentals of the economy suggest that the day of reckoning is down the road. Its not imminent. Ed, to your point about households, powell below you on the screen there so far saying that households are in good shape financially. Well keep our eye on that. Thanks, ed yardeni. Want to take a look at shares of gamestop, which has been halted yet again. I think it just resumed trading, guys. Up some 72 plus percent. You see it at the top of your screen along with amc and other names we remember from the meme stock craze. Yeah. We can bring them all back if you want. Are you going to be in the sequel to the movie . I hope so. Have you signed up . I think my contract will still be in play . Summer money . Leslie ill let you say it, dumber money. The market up 72 for gamestop is roughly 16 billion. This all began it appears yesterday from the first time we heard from Roaring Kitty, the gentleman behind the first time, of course, that gamestop shares surged, along with a number of others, that became that meme stock craze with not even sure how to describe what it was. A recliner. Sitting up. Sitting up and paying attention. He was paying attention. And you have seen that. Is kate good or not . Sorry. Couldnt hear you. Okay. But well keep an eye on it. Is it all retail based . Are there Market Makers caught on the wrong side who have to buy here . Its unclear. There may be any number of different mechanisms going on that are contributing to this, but generally speaking, of course, it was that communication from Roaring Kitty that set this off, and who knew they were out there still. You covered it pretty closely during that period of time. Who knew short sellers were out there still is my question considering how badly they were burned three years ago or so. I was surprised to see that a billion dollars in losses took place yesterday in some of these meme names alone. Yeah. Meantime youre watching powell live at the bottom of your screen. Some of the headlines crossing just now, economy performing very well. Very strong labor market. Households in good shape financially and Consumer Spending and Business Investment are strong. Lets listen in. The u. S. Economy has been performing very well lately. We had growth last year of just over 3 . Quite a strong year. And its driven by a number of things. I would point to a very strong labor market where youve got rising employment, youve got rising wages, so disposable income, consumers are spending. Generally households are in good shape financially. Theyre not over levered. We see a big picture. Consumer spending has held up very well. As well, Business Investment has been strong. Businesses are seeing opportunities to invest and that has helped. I would also point to a fairly large influx of immigration into the country over the past couple of years, and those people are joining the labor force. Were experiencing still a labor shortage in Many Industries, and so there are jobs, and theyre going to work and theyre consuming so thats also boosting growth. So overall, a good picture looking at the data so far. The labor market is very, very strong. It was, i think, overheated a couple of years back, and what weve seen is it coming back and gradually into a better balance over the last couple years. Now i think if you look at a broad range of data you would say, you could say that the labor market is about as tight as it was before the pandemic in 2019 and thats good. Wages are real wages are now positive and unemployment has been below 4 for 27 consecutive months, something that hasnt happened in a half century. Labor market very strong and again, signs of gradual cooling and rebalancing so that supply and demand of workers is coming back into balance, just as we would want. Inflation is worth starting with the fact that on a 12month basis, headline inflation got as high as 7. 1 , is now down to 2. 7 . Core inflation got as high as 5. 6 and is now at 2. 8 . Its down by half. That progress, though, really happened over the course of last year, particularly the second half of last year. We the First Quarter in the United States notable for its lack of further progress on inflation. We had higher readings in the First Quarter and higher than we expected. We did not expect this to be a smooth road, but these were higher than anybody expected and so what that has told us is that well need to be patient and let restrictive policy do its work. If i turn to the outlook just for a second, i would say we expect continued growth 2 or better. We expect the labor market to continue to be strong, but to move further and further into balance, and i expect that inflation will move back down on a monthly level, on a monthly basis two more like the lower readings were having last year. My confidence is not as high as it was having seen these readings in the first three months of the year. So were just going to have to see where the inflation data fall out, and ill stop there with the economy. Thanks. Thanks very much. Well be digging into some of the all together, positive comments from chair powell there. We will continue to monitor as he is speaking. As we head to break, though, heres our road map for the rest of the hour. The read on retail. Had home depot missing on the top line and seeing continued softness. Whats ahead for retail from here. President biden slaps big tariffs on chinese imports. What is being impacted and the fallout as china says it will take counter measures. We will continue to monitor chair powell and bring you the eng lines as were close to opinsession highs. Dow up 105. Stay with us. [busy hospital background sounds] this Healthcare Network uses crowdstrike to defend against Cyber Attacks and protect patient information. But what if they didnt . [ominous background sounds] this is what it feels like when cyber criminals breach your network. Dont risk the health of your business. Crowdstrike. We stop breaches. Norman, bad news. Doi never graduatedth from med school. What . But the good news is. Xfinity mobile just got even better now, you can automatically connect to wifi speeds up to a gig on the go. Plus, buy one unlimited line and get one free for a year. I gotta get this deal. Thats like 20 a month per unlimited line. I dont want to miss that. Thats amazing doc. Mobile savings are calling. Visit xfinitymobile. Com to learn more. Doc . Welcome back to squawk on the street. Shares of chinese ecommerce giant alibaba as you can see profit falling, dropping 86 from a year ago. Though the company did beat some estimates on revenue. Stock has been an under performer on the year as you can see with the decline of about 8 . And home depot in the red after a quarterly revenue miss. Samestore sales falling nearly 3 . That was more than expected with ceo ted decker saying the company is still seeing, quote, continued softness in certain larger discretionary projects. Joining us to discuss the quarter, cowen analyst cal lorenco who has a buy rating on the name and core site ceo deborahs whenning, ranked the number one analyst for ten years in a row. Thank you so much for being here both of you. Max, start with you, your broad thoughts on the quarter. The company did reaffirm guidance which suggests a pickup in the second half of the year how incumbent is that pickup on say a few rate cuts . Thanks for having me on. In general First Quarter was a little bit softer than expected. Samestore sales missed by a little bit, weather unfortunately was once again a headwind this year, as it has been the past several years, and then there is a little bit of theres some softness from deferral in big ticket projects spend, so a little bit of a miss on top line. That was somewhat expected, and then the company did do a really nice job of managing expenses, especially Gross Margins, so that was quite nice to see. In general, as we thing about the next couple quarters, i think a lot will be dependent on weather to improve as pockets of the country that have seen better weather, certainly did see nice pickup on that weekend business, and second, whats going to be going on with the rate environment and whether thats going to drive potentially somewhat of an improvement in some of those big ticket categories. Deborah, what does this say about the state of the consumer . Are there any insights we can glean in terms of the way and appetite that consumer has to spend on home renovation projects . Thats a great question. Thanks for having me on. I think number one, if you think about the fact that theyre using debt in some cases to finance this, theres much less of an appetite around that. Number two, we continue to see weakness in big ticket pretty much across the board, and three, they did say this is the one kind of call out or watch out to me on the quarter is that they were seeing some categories which were on a kind of twoyear basis, much weaker than they would have expected and so i would say that there is when it comes to big ticket we have not seen the rate cuts many have expected and were actually one of the numbers that is critical were at the lowest rate of housing turnover weve seen in potentially, you know, history, and so without people buying new homes, theres no pent up demand because people havent we havent seen the housing turnover as expected so i think that is in the Home Improvement category specifically, some of the challenges were facing. When we look at it from a macro perspective, i would say that the lack of rate cuts and having these debt to finance some of these projects are holding us back. Max, speaking of debt to financing, certain things, what do you make of the srs acquisition that was, of course, announced towards the end of the quarter, 18. 25 billion enterprise value here dilutive on a gap eps basis . Yeah. Were actually quite positive on the acquisition. All the work weve done around the company has been quite positive. Obviously, this is the largest acquisition that home depot has ever made, and they certainly could argue it paid off for the asset. That being said, srs is a phenomenal company. Theyve done a really nice job over the course of its history. They do a really good job on the Technology Side and really integrating a lot of the acquisitions that theyve made and really its that Technology Capabilities thats going to be interesting for home depot as it is certainly one major area where theyll be able to leverage srs in their capabilities. When it comes to the stock im curious for a company that has not really grown in any significant way for a bit of time, what do you pay for it . Where do you come down in terms of what an appropriate multiple is, for example . As i, you know, weve been very positive on retail in general. Thats the opportunity around retail media, the opportunity to monetize ip, monetizing data and home depot has always been, you know, incredibly innovative and i would say almost actually all of their acquisitions have really delivered more than i would say we as analysts would have expected. But i do think that as we look at the balance of the year and where we are withrate cuts and i think, you know, housing turnover and the consumer being a little more careful around debt financing, i would say that i would this maybe i would be on the sidelines for now. Hard to believe two months ago this stock was at 395, currently now 339. Max and deborah, thank you both. Thank you. Still to come this morning, the Biden Administration announce something new tariffs on billions of dollars worth of chinese imports, including evs. What investors need to know, the fallout and impact on gdp, and pricesing, when we return. Your shipping manager left to find themself. leaving you lost. You need to hire. I need indeed. Indeed you do. Indeed instant match instantly delivers quality candidates matching your job description. Visit indeed. Com hire i got the cabin for three days. Its gonna be sweet matching your job description. What . Im 12 hours short. Have a fun weekend. Unnecessary action hero unnecessary. Was that necessary . No. Neither is a blown weekend. With paycom, employees do their own payroll so you can fix problems before they become problems. Hmm get paycom and make the unnecessary, unnecessary. See you down the line. Its a beautiful. Day to fly. Wooooo . Welcome back to squawk on the street. The Biden Administration announcing tariffs on chinese imports. Meghan ka cella joins us from the white house on what goods are impacted and the fallout. Rose garden today . The rainy white house front lawn. The Biden Administration is targeting 18 billion worth of chinese imports. The list is going targeting what the white house calls strategic sectors that includes steel, solar cells, batteries, all of these tariffs including electric vehicles will range from 25 to 100 . This move is the result of bidens review of the tariffs that President Trump put in place in 2018. Trade Officials Say now that china has not sufficiently changed behavior including on i. P. Theft or over capacity they left the flifs place adding new ones to protect u. S. Manufacturers. Over time whether its in electric vehicles, which is before us right now, or in Industries Like steel, aluminum, solar panels, these practices have allowed the prc to corner the Global Market in production. Thats created tremendous vulnerabilities for the rest of the world. Reporter now the white house says these measures should not escalate tensions with china because theyre narrowly targeted. China has pushed back already. A government spokesman said this morning the tariffs will seriously affect the atmosphere of bilateral cooperation. Guys, sources tell me the white house recognizes china may retaliate but expect any response will be similarly measured. Guys . Meghan, im curious what did biden say about these tariffs for years ago . If i recall he was not supportive of them. Im curious what changed over the course of those four years, and what this means for the election come november . Reporter hes got an interesting history, right. He was a free trader like many in both parties that have shifted thoughts on that when President Trump was in office he was a push back with really that these tariffs were too widespread, it was going to hit theeconomy and hurt american consumers. What white house says about that now they specifically really narrowly chose where these tariffs would be hitting so it shouldnt hit consumers writ large. If youre out buying solar packages for your house or looking to buy an lech trick vehicle you might feel this. Writ large this is more about protecting u. S. Manufacturers and thats the most important thing right now in the white house. All right. Meghan, thank you very much. Producer prices coming in hotter than expected or as chair powell puts it mixed. More on the fed impact in just a moment. Plus, were continuing to monitor fed chair powell speaking live with the Foreign Bankers Association in amsterdam this hour. Well bring you those headlis ty pp. Nne stay with us. Were still going for that nice catch. Were still going for that perfect pizza. And with higher stroke risk from afib not caused by a heart valve problem,. Were going for a better treatment than warfarin. Eliquis. Eliquis reduces stroke risk. 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Its amazing to me how many people write in about their dogs changing for the better. The farmers dog is just our way to help people take care of them. Gamestop shares closed higher by 74 in yesterdays session. Take a look at them now, another 77 so far in an hour of trading. Along with, of course, a number of the other names you can remember from the meme stock craze led by amc, and a bunch of smaller corporations. Kate rooney what is going on there today . Into first of all the meme stock frenzy is back sparked by a series of social media post business a man named keith gill. If you followed the last meme stock in 2021 might know this man as Roaring Kitty. He testified in front of Congress Alongside ken griffin. We hadnt heard from him in about three years and yesterday he was back on x tweeting, movie clips, there was x man, avengers, ferris bulers, nothing to do with gamestop, but online traders interpreted this message as go out and buy gamestop. Its the biggest mover in terms of those meme stocks you mentioned, david, but also amc which announced an Equity Offering this morning. Santoli points out they did complete that and didnt capture that upside. Also blackrocberry and tupperwa all household names and highly shorted that tends to attract retail traders that want to inflict pain on the hedge funds or professional traders betting against these struggling stocks. Gamestop bears had gone into hibernation after 2021 but Short Interest has been climbing in recent months. It was last month at least up about 5 to around 24 of the float or outstanding shares. These outsized movies likely resulted in Short Covering yesterday that does appear to be playing out here. Game stop shorts lost about a billion dollars yesterday according to s 3. Interesting that bitcoin is not really moving here. Normally seen as a risk proxy. Those im talking to say its a sign its maturing. The nickname ive heard some people use around it lately is boomer is getting a little more mature now that these etfs are a lot less volatility. That got at a lot at the desk. Boomer coin. As kate points out meme stocks have having a moment but Broader Market rallying as well. Bob pisani here to talk about the market line. 4 to 1 advancing to declining stocks. We have a broad market advance and thats moving some stuff. Since may, broad parts of the market have been advancing largely because the market has been returning to the narrative of the soft landing. Softer u. S. Jobs data and dovish guidance from the fed, ecb and bank of england. As a result, there has been a broad market advance in may. The s p 500 advanced decline line is again near new highs. The s p 600 small cap advanced decline line is near the highest levels since december. Thats small caps. The s p 400 mid cap is at a new high. Not surprisingly a lot of stuff thats been under performing this year is getting dragged a bit higher by the broad rally. Some of the big gainers this week have all been down double digits. 10 to 30 this year including tesla, etsy, illumina, skyworks, nike, snowflake, i could go on and on, stuff that has had terrible years has been advancing in may. Sell in may and go away, remember that. Heres the pain trade. The market move that would upset the greatest number of participants would be a rally in may. Thats exactly whats happened. Everyone anticipated a 5 to 10 decline that would persist through a good part of the summer. So far none of this has happened after a brief 5 decline in mid april the s p 500 up 3. 7 in may, less than 1 from a historic high as is the dow industrials. The vix closed at the lowest levels of the year on friday. So the important thing is on this question of gamestop, people have asked me who is doing the buying and selling, i dont know. But i looked at the volume trades here. The vast majority of trading yesterday centered around 100 shares at a time. That doesnt necessarily indicate lots of retail. You can break it up. That does indicate a lot of retail to me. Only 4 of the volume is 10,000 shares or more trade at all. Its not clear how many people are actually large institutional traders but institutional sized trading was a very small part of the overall volume. As you know david you can disguise trading easy. Thousands of hundred share orders through in a short period of time. The block trades were very, very light yesterday in this. Does this have everybody searching to take a look at Short Interest as a percent of float again apparently it got to high on gamestop yet again, like as much as 25 . I assume there are lists being sent around. There are. And retail ownership in terms of volume as a percent of total volumes. None of this means anything in these stocks. Remember arch crawford back in the 1990s. Astrology. Had a significant following. We had him on our air. The moon is in venus, buy microsoft and we used to stare at each other, youve got to be kidding me and yet mr. Crawford had a following. People liked him. If you could get enough people to stand around buying on sun spots, you could potentially move a stock. So this does not mean fundamentals dont matter. It doesnt mean anything. It means in certain circumstances you can get enough people believing in certain things and move stocks that have completely independent of the traditional way you own a stock. Why do you own a stock . You own a stock because youre buying a future stream of earnings or cash flow more specifically in the form of dividends or earnings or buybacks. Thats the purpose of owning a stock going back 400 years. I dont think its been repealed by this at all. Tomorrow is the 13f deadline for the First Quarter and if you recall three years ago there were some put positions disclosed which then had some discussion on reddit to target them. Melvin capital was one of them. Kind of interesting timing with the 13fs for q1. No one really since then has been brave enough to disclose a put position against gamestop, but it will be pouring through the filings. Back to 1602, the Dutch East India Company first modern stock floated they had the spice trade in indonesia and malaysia and in the indias. Biggest company in the world for hundreds of years. They turned around and said the reason you buy our stock were going to distribute the profits from the spice trade and why you own our stock and that has never changed. Business of owning a stock is distributing the profits from the business. Thats what it is. There is nothing here. Theres no fundamental change in anything at all thats going on. We keep saying it, bob. Of course i think you still own shares of the dutch spice change is huge. Napoleon broke it up in the 1800s. You were angry with him back then. Bad move. Big profits for no sum of the parts there really . Bob pisani, thank you. Google kicking off its annual developer Conference Today with a core focus as you might expect on Artificial Intelligence. Lets get over to deirdre bosa and she has more on what we can expect. Deirdre . David, its been a roller coaster in tech over the last 18 months. Ever since chatgpt came out at times google has seen as being behind, even though developed this technology and other times, its seen as a ahead. Today is a chance for them to firmly take the lead again. One of the biggest questions as we head into this Developers Conference is, will google make its generative chat experience more widespread . So far its existed as something called sge search generative experience. If youre a normal google user you might have noticed search looks differently but this is for a small group of users. The question is will they roll this out more broadly . Also, of course, gemini is its model that has made huge technological advancements. Will this be powering . What role is it going to play in search . Googles bread and butter Going Forward. The other idea, guys, that has been kind of really introduced this week is the idea that generative a. I. Is moving from chat bots to ai agents. We saw that yesterday with openais demo and even google previewed a different kind of generative ai experience yesterday ahead of this event. Take a listen. Those big pretty letters on screen what do those mean . Those letters represent google io. A developer Conference Held by google. Guys, that is a preview of probably what were going to see more of today, and that is ai that you dont just type into and ask a question, one that is multimodal, one that you have a discussion with, that has emotions like chatgpt as showed yesterday and ai that can reason. Today theres the potential of opening up a new era in the ai arms race. Deirdre, thank you. Of course we look forward to your further reporting and important interview later today. That dem there it is. Sundar pichai going to be joining deirdre at 4 30 exclusively here. Well get a lot more details on some of the things that we were just talking about. Traders are pairing bets on a september rate cut after Producer Prices rose more than expected in april. Chair powell addressing the overall inflation and fed policy outlook moments ago. Take a listen. We had a Producer Price index reading just a couple hours ago, and i would say its actually quite mixed. The headline numbers were higher but there were backward revisions and, you know, we, of course, are taking it apart and looking at it. I think markets and analysts are looking at a it i wouldnt call it hot but mixed. In terms of the overall picture for inflation, i think you have to go back to last year where we had historically fast disinflation, inflation came down by two full Percentage Points last year. Why did that happen . Its really two forces working together. One of them is, just the reversal, the unwinding of the pandemic related supply and demand shocks, so that we thought we would always get that. We thought we would get it in 2022 and we didnt, and it really arrived in 2021. That was a big part of this, was the reversal of distortions really to both supply and demand. The second thing is restrictive Monetary Policy. Restrictive Monetary Policy cools the economy and makes room for the supply side to heal, but also lowers demand and ultimately lowers inflation. So i think i do think those two have been working together, and the question you ask is, is inflation going to be more persistent Going Forward . I think and that would essentially mean that weve got an supply side gains that were going to get and now its down to lower demand which would take longer and potentially be more painful. I dont think we know that yet. I think we need more than a quarters worth of data. I think by many measures the policy rate is restrictive. The question is, is it sufficiently restrictive and thats going to be a question that time will have to tell. Entertain the possibility is, you know, that could be a very small probability, but i have said that i dont think its likely based on the data we have that the next move we make would be a rate hike. I think its more likely that well be at a place where we hold the policy rate. Speaking of rate, rate cuts, our next guest says it might take three or four benign inflation prints before the fed makes a move. Wells fargo economist sara house joins us now. Curious to get your reaction to the print itself from this morning and what you just heard from chair powell . Right. So in terms of the print this morning i dont think it was quite as bad as the initial read looked. Obviously, we saw it come in ahead of expectations, but when you take into account the revises, we ended up seeing the trend more or less where we expected. For headline ppi it was 2. 2 in line with consensus. I think it did show, though, that the next phase of the inflation fight, it is going to be harder. Were getting less goods disinflation and at the same time were still seeing quite stubborn services inflation. So that was the more worrisome spot for me, is what we saw in terms of the other services. Stripping out those goods adjacent sectors like transportation, warehousing and trade services. So i think its right that the fed is taking a little bit more of a patient approach, as they do seek to continue to look for that confidence. So three or four benign inflation prints, when do you think we start to get them . Well, i think well get a step in the right direction with tomorrows cpi report, so were looking for a 0. 3 increase in core cpi so that would be a step down from the 0. 4 monthly prints that we saw through the First Quarter. I think in order for the fed to be on board with a cut by september, unless youre really seeing the labor market fall apart, youre probably going to need to see something closer to. 25 or. 2. Step in the right direction for tomorrow, but its going to take more than a softer print in april i think for the fed to regain that confidence that inflation is moving back to 2 on that sustained basis. We are seeing some indications from ceos during the earnings season talking about how the lower income consumer has been cutting back on spending lately in the face of these higher prices. At what threshold do you think that starts to have a meaningful impact on inflation . At what point do you see or are you forecasting that being enough to really help bring down prices . Yeah. So we are expecting that, despite the stickiness of q1 inflation data, that downward trend is still in place even if its going to be much slower going than what we saw over the past year, and i think the fact that it is getting harder for businesses to pass on higher prices is a part of that. Its not just purely about the supply side help anymore, but its also that its getting amid a somewhat softer demand environment its getting harder to pass on prices. We can see this already a little bit in terms of, for example, the nfib price plans moving down on trend and so i think that is going to help in terms of that next phase of reducing inflation, but at the same time overall the consumer is still doing pretty well and its going to be slow progress overall this year. Sara, thank you. Still ahead this morning billionaire and meta ceo Mark Zuckerberg turns 40 today. Well tell you about his big Birthday Gift and his wealth. Check out shares of flutter, the gaming operator and owner of fan dual announcing it expects to meet a full outlook swing against its u. S. Books in march due to successful march madness bets. Shares are lower on that news. Were back in just a moment. I came to the u. S. As an immigrant and started here in college as an undergrad and came to work at morning star out of college and i worked my way up the firm and i think the best lesson is, that a combination of hard work, entrepreneurship, and just contributing to society does lead to great outcomes. In my view the American Dream is alive and well and thriving. [busy hospital background sounds] this Healthcare Network uses crowdstrike to defend against Cyber Attacks and protect patient information. But what if they didnt . [ominous background sounds] this is what it feels like when cyber criminals breach your network. Dont risk the health of your business. Crowdstrike. We stop breaches. Your record label is taking off. But so is your sound engineer. You need to hire. I need indeed. Indeed you do. Indeed instant match instantly delivers quality candidates matching your job description. Visit indeed. Com hire you ready . Showtime. This is gonna be epic. Matching your job description. [ barking ] its what the poster said. Do you want to make out or . Nope. I meant yes. Hes a bon garcon. I give amazing spongebaths. Can i get a room . [ chuckling ] chefs kiss. If youve ever grilled, you know you can count on propane to make everything great. But did you know propane also Powers School buses that produce lower emissions that lead to higher test scores . Or that propane can cut your energy costs at home . It powers big jobs and small ones too. From hospitals to hospitality, people rely on propanean Energy Source thats affordable, plentiful, and environmentally friendly for everyone. Get the facts at propane. Com now. Welcome back. Cnbcs 12th annual disrupter 50 list is out to you and a familiar name is at the top of the list. Julia boorstin is here to break down this years big trends and i would guess ai is a key part of that. Ai. Ai is no surprise the big trend dominating this years list. Openai is taking the top spot for the second Consecutive Year the first time weve ever had one company top the list two years in a row. Generative ai with chatgpt is now used by more than 90 of fortune 500 companies and openai has kept up with growth, scaled its Corporate Partnerships and continues to launch new innovations including just yesterday, its new gpt4. 0 which can process image and voice to be truly conversational. All of that has earned openai an 86 billion valuation. Its not just openai. There are 34 companies on this years disruptive list saying a. I. Is critically important to more than half their revenue. 13 of those say more specifically that generative a. I. Is critical. The most represented sector on this yores list is enterprise tech with 14 companies, followed by fintech with nine, including stripe, which has been on the list a record ten times. And then the next category is health care and biotech with eight companies. Half of this years enterprise tech disrupters off a. I. Tools to help companies overhaul everything from collaboration and Market Research to search and drug development. Others like canva and figuma ar in graphic design. 29 companies from last years list and 19 firsttimers. Unlike when theres been a robust ipo market, none of the companies on last years list went public. You can find all the companies on the list at cnbc. Com disrupt ors. Is the pool of candidates getting larger or smaller over time, would you say . The pool of candidates is getting larger but the companies on the list are actually getting more valuable. The valuation of the companies on this list, 436 billion, thats a valuation up from 362 billion from last year. We are seeing the companies become more mature, because theyre waiting longer to go public and the valuation of these a. I. Companies shoot through the roof even though theyre not particularly old. Just a couple years old. Is there a sense this years list will have more ipo candidates than last years list . Last year there were a sense there were companies that were ready to go public but the ipo market wasnt ready for. We saw an ipo cancel or delay and i think it happens depends on what happens with the market, we are seeing some acquisitions. I think the question really is, you know, when the market does feel like its truly open, there are definitely going to be companies that are ready to go. Its just a question of timing. When it comes to open a. I. , im struck by that not for profit, for profit structure, and even a cap on the profits that early investors can actually receive. Cap one profits for early investors but a big piece is not only generating profits for open a. I. But also its customers. All of these big fortune 500 Companies Using its tools like moderna therapeutics, they are with openai. There are a number of companies. How openai as an Enterprise Software tool can benefit the profit of some of these companies. Can you envision a year where all 50 are a. I. Based . Theyre halfway there. When we started the list 12 years ago because we were seeing Technology Impact every different sector. Now i think you could say pretty much every company in some way or another, whether Agriculture Company or Consumer Products company is a tech company. And i think very quickly every company in the world is going to have to be using a. I. In some way. Whether its Customer Service or just make sure theyre efficient in the way theyre processing data. Julia, thank you. Great to be here. Speaking of a. I. And Companies Spending an enormous amount on it, metas cofounder Mark Zuckerberg are turning 40 today. Hes closing out a decade thats seen his Company Surge by 1 billion. Robert frank has the numbers. Good morning, david. Along with his 40th birthday today, Mark Zuckerberg has some other big fours to celebrate today. Hes added 40 billion to his net worth just this year. Over 140 billion over the past decade. He is now, as of today, the fourth richest person in the world, just behind elon musk. He would likely be celebrating today on his new yacht that he bought for his birthday called launch pad, coincidentally is about 400 feet long. Private jet and yacht tracking say both are off the coast of panama today accompanied by his backup yacht, the one that carries his helicopter, crew and electric surfboard he loves to show off on. Its a big turnaround for a guy who lost over 100 billion just in 2022. His net worth fell to 36 billion. His net worth today is 170 billion. He has ten homes in california along with the famous 1400acre compound in hawaii that includes that underground bunker. And theres one more four we can all celebrate. Their philanthropy has made over 4 billion in grants since it launched in 2015. The numbers are staggering. I dont know weve seen anything quite like it, robert. I mean, have we actually i guess thats my first question. When you adjust to the the year of rockefeller and others, for example, is it similar or does it even exceed that . Inflation adjusted, its larger than rockefeller, but as a share of gdp, no one has approached rockefellers net worth. Whats interesting about zuckerberg and all these guys that came onto the scene in the early 2000s or even 1990s, they all came on as sort of tshirt wearing, hoodie wearing idealogs. We just want to change the world, its not about money. By the age of 40 its all about the mansion, the jet and yacht. They all become the stereotypical rich guy by the age of 40. It happens to everybody. Bezos by the late 40s he got the yachts, the mansions. They all in the end its about the mansion and the yacht, for all of them. Not musk. Not really musk. Am i right in saying that . Not yet. Youre absolutely right. Real quick, robert, philanthropy, rockefeller is responsible for an enormous amount of good that occurred with that wealth. Do we expect the same here . Yeah. I mean, basically Mark Zuckerberg and his wife have both pledged to give away 98 of their shares in facebook. So, of that 170 billion, most of that, you know, 98 of it, will go to charity. Unclear exactly what hes going to support. Yeah, we can count on almost all of that going to philanthropy at some point. All right. But hes still got a long way being only 40 years of age. Robert, thank you. Robert frank always has the numbers and, of course, incredible boats. Our live market coverage continues afr is. Teth trading at schwab is now powered by ameritrade, unlocking the power of thinkorswim, the awardwinning trading platforms. Bring your trades into focus on thinkorswim desktop with robust charting and analysis tools, including over 400 technical studies. Tailor the platforms to your unique needs with nearly endless customization. And track Market Trends with uptotheminute news and insights. Trade brilliantly with schwab. The all new godaddy airo helps you get your Business Online in minutes with the power of ai. With a perfect name, a great logo, and a beautiful website. Just start with a domain, a few clicks, and youre in business. Make now the future at godaddy. Com airo new projects means new project managers. You need to hire. I need indeed. Indeed you do. When you sponsor a job, you immediately get your shortlist of quality candidates, whose resumes on indeed match your job criteria. Visit indeed. Com hire and get started today. Clems not a morning person. Or a. People person. But he is an i can solve this in 4 different ways person. You need clem. Clem needs benefits. Work with principal so we can help you with a plan thats right for him. You know what im saying . Let our expertise round out yours. Good tuesday morning. Welcome to money movers. Today alli mccartney on the one part of tech that will outperform the Broader Market. And the Biden Administration raising tariffs on 18 billion of chinese imports. Former commerce secretary carlos gutteres is with us. Well get a look at gamestop, amc and others this hour as weve been in the green most of the morning. S p 5230 despite a ppi that gave some initial jitters but some internals and negative revisions making it a mixed result as the fed chair said a little bit ago. Lets bring in cnbc senior markets commentator mike santoli. We were watching the twoyear when that number popped