Transcripts For CNBC Squawk 20240702

Geopolitics and what is happening in gaza and israel and what is happening in ukraine and russia and the economy as so much more. We will bring you all of that conversation ahead over the next three hours. Well be showing you pieces of that interview all morning long. Andrew, your biggest take away the biggest thing you think will be most important for the markets or investors watching with us . You know, we got into the conversation which we will show you in the 7 00 hour with the euro it is likely the ecb will move ahead of the fed and that will weaken the euro. There are a lot of take aways how he is thinking about politics and we talk about the issues with china and we mentioned tiktok i mentioned that in new caldonia, where there are riots taking place, they shutdown tiktok he had pointed words with how the United States is thinking about china as an enemy or frenemy. There will be pieces of this that folks will be watching. The euro is down 2. 5 on the year just on those concerns that the ecb is going to cut rates and the fed wont be able to for a while. That makes the dollar stronger and that, in some ways, brings a lot of inflationary pressures back to the ecb and euro as well theres no question no question. By the way, we talked about the olympics were here in paris and it gets crowded every day. This is the city that is clearly getting ready for their big moment in the sun and a lot of folks will be following all this one of the other things we will get into and we will show yo this on tape as well this is an issue of trying to create a truce between ukraine and russia during the olympics there has long been going back to the ancient greeks of the olympic truce and an effort under way to create a truce for two weeks. We heard so far that president xi is on board publicly with macron macron has been pushing china to put pressure on russia president putin, of course, not going along with that. Stay tuned we will have more on that in a moment lets look at the markets this morning. If you look at the u. S. Equity fu futures, there are green arrows across the board the dow futures are up 25. Same astory for the s p. The nasdaq is indicated up 155 that is largely because of what we heard from nvidia we will talk more about that in a moment that comes as the dow fell 202 points edinso far the s p and nasdaq are also down after minutes from the last fed meeting discussed a lack of progress toward lower inflation in the recent months and discussing a willingness to hike rates if inflation did not continue to move to the 2 goal. Goldman sachs ceo David Solomon said he expects the fed will not cut Interest Rates at all this year that comes among the economy proving to be more resilient thanks to Government Spending and investment in the Artificial Intelligence infrastructure. That is driving things today a quick look at the treasury market with the 10year yield at 4. 41 the other big markets or the one is nvidia. The stock is rising after earnings at 612 per share. That was driven by growth in the S Data Center category Current Quarter revenue guidance came in 1. 5 billion higher than wall street invesexpected you see the stock indicated higher by 7 which is around what the Options Market was. Handicapping ahead of time in my mind, the market was hesitating for two or three days for nvidias permission to try the upside you were telling us that. It is an interesting dynamic. Nvidia is on the january fiscal year it has the stage to itself there is all of the forecast us on concentrated bets it answered whatever doubts. I dont think there were a lot of doubts. It pushed anything out the window people doubting this were thinking it would not continue at this pace people have been saying the longer we go with this, the higher the stock goes and the cheaper it gets. The e is rising faster than the p. The scale is probablycedentes doing. It has the product transition to the new processor and blackwell is ahead of plan they have a oneyear cadence with the new chips there are customers, meta, amazon and microsoft customers of the world, will create productivity they are operating as if it is helping them or scale. From their customers. I think this is a continually looking down the line. You are looking at a. I. Applications where it really is automatically profitable to put these things in. If you look at the case situation of customer call centers. For that to be automated, you could make that with the investment i was talking to an a. I. Guy the other day. You can make that instantaneously profitable looking at the productivity and looking at the bottom line paying off thats when jensen huang speaks and saying we will not meet the demand until halfway into next year and the halo effect into nvidia the dell news because of the line they have and the entire ecosystem rides with this. Amaz. This is different from the tech bubble in 1999 real money put to play and real profits put to play. Things are being built on a real platform exactly i was saying after the report last night and one reason why it can nourish the market more broadly, it is not magic the reason i think that we have seized on it is that the Companies Invest bing in nvidia, running through nvidia are the massively Profitable Companies like meta and amazon and alphabet and the rest, m maybe buying back stocks and other investments, but it is put into motion and nvidia is turning it into Free Cash Flow we are putting a multiple on that in the market it is not magic. It cannot last forever returns will probably go down for the margins on nvidia over time for now, the game is on. Unbelievable story. Andrew in the meantime, a story that also is making waves is tesla. The company grbroke ground on t battery factory in zhang the start of the construction would further consolidate the leading position in the Energy Storage. It expects the factory to begin in the First Quarter next year elon musk will speak in france today at viva tech we will hear more about the tesla plans and what he thinks is going on in china a conversation we get into with the president of france. Coming up, we will have that interview with the french president Emmanuel Macron. His comments on a. I. And jobs and the potential impact on the work force and, yes, the idea of billionaire s and wealth in france and how that is all supposed to work you are watching squawk box here on cnbc trading at schwab is now po, giving traders even more ways to sharpen their skills with tailored education. Get an expanding library filled with new online videos, webcasts, articles, courses, and more all crafted just for traders. And with guided learning paths stacked with content curated to fit your unique goals, you can spend less time searching and more time learning. Trade brilliantly with schwab. Power e trades easytouse tools, like dynamic charting and riskreward analysis, help make trading feel effortless. And its customizable scans with social sentiment help you find and unlock opportunities in the market. 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Dont miss out on our fastest speed plans yet switch to comcast business and get started for 49. 99 a month. Plus, ask how to get up to an 800 prepaid card. Call today welcome back to squawk box this morning i am live in paris tech ceos descending here in paris. I had an opportunity to sit down for a halfhour interview with the french president Emmanuel Macron and exclusive conversation over technology which has been focus for this president since he took office seven years ago. We spoke about that and what he thinks is driving the innovation for Artificial Intelligence in the role of france and how to balance the issues of a. I. With jobs and the work force and inequality take a look. It is true that a few days ago we hosted the first forum to attract businesses and investment in tech and other sectors as well with 50 billion for this session we have viva tech which was created a few years ago and now a huge success we have all of the a. I. Players coming from all of the world i do believe that the Tech Industry is one of the key factors of transformation. Innovation and growth creates a lot of opportunities for qualified and qualified people this is a big source of mobility in our society. Unqualified people, too yes, both i spoke about this on this stage, but it provides a lot for existing businesses and provides qualified and unqualified jobs by transforming existing business and large caps. This is why i believe in the sector and i clearly believe that france should be one of the leaders in this field. We multiply ten in ten years for tech when you take the difference with the u. S. And europe, we are lagging behind the growth per kcapita is half i europe as in the u. S. As the path indicates the main driver is precisely the lack of innovation we have to do much better. This is the case france is leading the Tech Industry in europe we want to multiply partnerships with other places in the world a. I. Is not just a sector. It is a huge revolution. It will completely transform education, democracy, work, a lot of things. I think our challenge for a. I. Accelerates and innovates. The ceo as you called him the french genius says the biggest risk of a. I. Is the workplace revolution i think this is not just a risk a. I. Will be a revolution for work for good and bad. Good, it is quite sure it will increase productivity. You know, it was one of the big mysteries of our economic lives that social networks and the social economy was not possible as an increase of productivity clearly, it will be the case with a. I it will completely transform that may mean a lot of jobs i agree with you. It will push us to shift a lot of calqualifications this is why we have to understand and progressively be aware of that and educate our people and we have to work very hard on the qualifications of a lot of people. We have to train and qualify a lot of people. The big question and you know i speak from experience where it is less used in the 1990s, Tech Revolution was the big debate western economies or economies with a certain level of wages with the high cost of labor when they adopt, they preserved the footprint. We dont want to have robots in france we focus on capacity the question is how a. I. Will be at the service of humanity and not just seen as a substitute of hum humanity we have risks. We have to assess them we have to lead innovation to be in a situation to regulate in appropriate terms and say i want a. I. At the service of humanity and increase productivity and in a substitute i have to maximize the number of good jobs in my economy. Lets ask this. This is a philosophical question of attracting startups to france i think you want to foster entre entre entrepreneurship here in france. When you think of the folks who started google or meta, they went on to become billionaires i want to understand the paradox of how you understand how you create the people who may become people of great wealth in a country which has a complicated view of wealth i think wealth is a completely different story everywhere in the world. It is true that france is focused on equality much more than others. We have an interesting taxation. I got rid of the tax when i was elected president. I put in place a flat tax. That is how we attracted a lot of variables we have to promote success through innovation i think it is very important in our society to make a clear distinction. You can have successful people when they perform as artists or in sport, but as in business as innovation is good for everybody because they create value for the whole people you have to accept that as a wise economy of tenants. You kill your own capacities if you reject this model. On the other side, the question is how to resist that point in time and avoid that in 10 or 20 or 30 years where it will be the children of those who have the talents will get benefits of the economy. It is true in our society the level of wealth is more and more in question. It is a tradition in france that changes that i wanted to transform this approach this is a good global debate i think having the wealth tax is a global debate. I push with the u. S. And with brazil and others a global tax which is more relevant than a french or european one otherwise, the tenants i dont know if you saw this. Janet yellen is against a wealth tax. The treasury secretary of the United States. Did you see that this is a pity. The g20 discussion this is a good global tax as a minimum tax we push in the agenda as a digital tax. You have to avoid big discrepancies. I think even in the u. S. Society, more and more people now are a little bit shocked or upset by the level of wealth its further when you are innovative and successful, you get money. When you create big innovation, even more. I think this is the right question with the scale of the planet to say we need more firmness i think it is an issue to do for people on the National Scale you mentioned artists before and creativity the Cannes Film Festival is happening now. I wanted to ask you. Openai said it would no longer use a voice a sounded like Scarlett Johansson, the movie star, because the voice was too close to her voice she was upset about that even though it was done by another actress. Im curious given your thoughts about creativity and whether you think a. I. Should be able and this is an intellectual property issue and copyright issue should be able to use a voice that sounds like somebody elses voice. Somebody may do this to you one day. Im asking the iphone to translate speeches in different languages. This is the issue we make with the company you mentioned at argue. I think the Big Questions we have on the table and it would be the question we would ask during the a. I. Action summit we have in person in february of 2025 intellectual properties is one of them. I believe we have to protect our artists and our writers and all of the different artists from any threat and we have to protect the intellectual property a. I. Should not be seen as a threat if we create the proper regulation i do believe that we need to do that soon. A global regulation. This is why in this conversation that we need the u. S. And china and the big economies and innovators of the planet to precisely protect this a. I lets ask about the big tech and regulation the company here in france has a partnership with microsoft a number of the big a. I. Companies are partnering with big tech all over again. If microsoft called up you and said we want to buy you, are they such a National Champion and say i cant do it . What do you think of big tech getting bigger i dont think it is good news i prefer them to be independent and grow on their own because i think m a is part of the Business Life for sure what we look with a lot of big tech and giants during the past few years is they had contrary innovation m a many proposals just to digest more innovation and to be sure they take the innovation, but make sure other guys dont go further to jeopardize them i think it is good for the u. S. Ecosystem to have a vivid and vibrant and ambitious eus ecosym we need much more european big players. I think a lot of investment and they look to decide here the more we will have european governments to be in the discussion with the chinese and u. S. Governments we have a lot more of that interview with french president Emmanuel Macron still to come, including his comments on china and geopolitics and ukraine and the impact on the economy and so much more when we get into gaza and taxes. You want to see so much more of it as we roll that out throughout the broadcast, mike a lot of fascinating stuff, andrew thank you. Coming up, the department of justice looking to take on livenation we will tell you about the report of the antitrust suit in the works. Thats next. Squawk box will be right back. I think the aanhpi community is quiet and hard working and a good student that means we are often forgotten. It took me years to find my voice and advocate for myself in the workplace. Remember, a diverse viewpoint is important and ultimately benefits the bottom line whats up, auntie . Did you get the basketball shoes i need for tryouts this weekend . Oh, dude. Thats okay. Im not going to be able to make it to dicks this week. You can just click on dicks. Com dicks. Com oh, dicks dot. Hi. Welcome to dicks. Com wow, theyre beautiful. Lets go shopping. Are you kidding me . Im in ball heaven. I like you. Look at all these cups. I really like you. I dont even live near water. Whoa, these arrived so fast. I know, right . Youre about to get posterized. Im going to shatter that glass. Come on, lets go. Dicks dot welcome to the roots of our legacy. Where excellence, comfort, and electricity. Are forever in bloom. Welcome to beyond. The mercedesmaybach eqs suv. Champion iron offers a rare solution to decarbonize the steel industry. Which represents up to 10 of global emissions. The Company Recently doubled Production Capacity at its mine in eastern canada. It is now investing to produce one of the worlds purest iron ore. Enabling green steelmaking without the use of coal. Controlling a large portfolio of high purity iron ore resources. Champion is considering Strategic Partnerships to further develop the region. Champion iron. U. S. Justice department and group of states plan to sue livenation entertainment over antitrust over control of ticket sales that is according to the bloomberg report which expects it to file suit in the state of new york today it is a big deal. People are talking about an at tstyle breakup of the company potentially. Sure. Forced and broken up into lots maybe not just two pieces. These are two companies that were powerful in their industries and allowed to be put together by making promises in 2010 that they would not punish venues that did not use them they have been cited several times over the years the Justice Department investigation is looking into that case. Livenation controls venues and ticketmaster having a huge market share right you think of pearl jam in the 1990s when they tried to go to ticketmaster it did not work. Mega stars cannot get around the issues it is not a popular company. It is funny you talk about overreach and regulatory and the Justice Department pushing too far and the ftc pushing too far. My guess is this gets less sympathy or empathy. Nobody is happy with the cost i s. Shares of alibaba is down on the report of a possible bond sale that stock is down 5 in hong kong trading you see the alibaba shares down 3 right now when we come back, the house of representatives has passed a bill that would create a new Legal Framework for cryptocurrency despite the unusual warning from the s. E. C House Financial Services chair Patrick Mchenry was a cosponsor of that bill and he will join us live from washington next. As we go to break, here is a look at yesterdays s p 500 winners and losers announcer executive edge is sponsored by at t business next level moments need the next level network. To start a business, you need an idea. Its a pillow 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 glp1 drugs used in weight loss treatments are a global blockbuster, even with unliked and inconvenient injections. More human Study Results for lexarias patented oral Delivery Technology are coming soon. Lexaria bioscience. Good morning welcome back to squawk box. Were live from the Nasdaq Market site in times square. If you look at the dow and s p and nasdaq the nasa damage is up 166 points this is coming after nvidia blew the door off things. Quieting any doubters based on what they are seeing and earning and what they expect to earn next year. Jensen huang says they will not be able to deliver on everything until next year. The entire ecosystem with microsoft and dell and beyond, you will see big moves nvidia shares up 6. 7 . Year to datdate, more than 100 gain we will continue to keep an eye on this story this morning. In the meantime, the first ever major crypto bill has pass in the house of representative despite the opposition from gary gensler. Joining us right now is Patrick Mchenry. He is the chairman of the committee. Lets talk about the bill. The big deal is this would finally settle who would be the regulator over cryptocurrency. A lot of things in the bill as wealth, but that is kicking up the dust and the democratic opposition you did get a lot of democrats to vote for the bill, but on the opposite side, you have President Biden issuing a policy statement saying they are not in favor of this, not necessarily going to veto it, but the vice chairman is not up to snuff and not ready to do all of the authoritative work it would take where do things stand right now . What happened . This should serve as a wakeup call we had twothirds of members vote in favor of clarity for crypto it creates a framework for the ftc getting a proper role. Rather than the regulatory actions they have taken. Congress settles the dispute it settles what is a Digital Asset and gives a framework for what is trading and purchase of the assets i think it is an important thing. This was a vote that includes 71 democrats across the spectrum. That should be the wakeup call to the senate and a wakeup call to the administration and sound policy thats the message today the outcome of that vote yesterday is that the senate needs to take action to have legal clarity and catch up to the rest of the world and be competitive in the world of Digital Assets. It has been a Long Time Coming this is a crazy turf fight. Tell me about it. You dont have necessarily support in the senate at this point. What are the odds of anything getting picked up in the senate and what are the odds of this passing in the senate . Look, last week, we passed the Congressional Review Act appeal of the adverse ruling of the current regime of the s. E. C. Of how you hold crypto how regulation firms hold crypto it is about accounting standards. We got 21 democrats in the house. Yesterday, we got 71 for crypto regulation it went to the senate, this accounting repeal. We had over ten democrats in the senate, including majority leader schumer vote in favor of repealing a Biden Administration ruling on crypto dont count the senate out they have a huge opportunity here you have a lot of interest with the buy bibipartisan senate you have the Ranking Member with boseman. We have gotten much further in an Election Year and im focused on landing deals where we can with the political environment yesterday was a good statement on that. Some of the pushback is the ftc is not staffed up enough or would not have the aggressive Regulatory Oversight that some critics would like to see laydown to protect consumers on this if you look at the cftc, they have 40 employees over the s. E. C. What do you say to the criticism this would be a lighter touch regulatory it has nothing to do with lighter touch. It is appropriate for the asset class. It is the fit 21act. It is fit for purpose regulation iffing if something is a decentralized commodity or digital commodity under this bill, it would have appropriate regulation at the cftc they do have antifraud and antimanipulation and Consumer Protection framework and we enhance that in this bill. It is not just a Government Agency head count that matters here it is competence and appropriate regulation which we provide in this act chairman mchenry, i want to thank you for being with us. It is rare that you see something that gets such bipartisan support we will see where it goes from here thank you for your time today. Thank you, becky. Coming up after the break, the ceo of the a. I. Company anthropic making waves here at the viva conference in paris over Large Language Models and more with our interview with president macron with the geopolitics comments and so much more as squawk box comes back live from paris and the nasdaq in just a moment announcer currency check is sponsored by Interactive Brokers. The best informed investors choose Interactive Brokers when you need to prepare for unpredictable adventures. gasp you need weathertech. [hot dog splat. ] laser measured floorliners front and rear. [drink slurp and splat. ] scream seat protector to save the seats. [honk ] theyre all yours were here hey, i knew you were comin. So i weatherteched the car can we get ice cream . We can now. Kid proof your vehicle with American Made products at weathertech. Com. Welcome back to squawk box this morning we are here in paris at the viva tech conference. Elon musk is slated to speak later today. I spoke yesterday to the anthropic cofounder i asked him about the recent Company Breakthrough which we spoke about on the show yesterday morning to understand how Large Language Models actually work. Heres what he had to say. There is a feature where the model gives completely over the top praise if you ask how are you, it will say you are so thoughtful for asking me how i am youre the greatest person in the world. Crazy over the top praise. This causality or ability to intervene is the ultimate test whether you understand systems we have a long way to go, but this is showing the beginning of something amaziamazing. I also asked him about what is so critical in terms of the advantage in this competitive field of a. I i think the thing that will determine who has the best model is talent. Invention of the best architectures use of the data and compute we have as well as we can use the data and compute. I think in any industry, it always comes down to talent. Guys, he is talking about talent there a major talent war going on over engineers who actually understand these models and can get inside of them you see folks leaving openai in the last week over the s safrt safety issues. You see the war only beginning and more and more money paid up listening to this since last year, andrew, the idea of somebody coming in and everything on everybody 1 million each so they leave and raid the whole place you have been talking about this for a while. 1 million . A good engineer in this space is a 10 million deal this is an allstar for a regular star not to say they are regular stars, but at that level unfortunately, we fleneed a lot more education there are not enough people in the space to truly understand it as deeply as you want. That is part of the issue and why the salaries have gone so sky high andrew, whats the expectation from these players in terms of what the end game is here it is not winner take all, but there are a lot of models out there. Maybe some of them are just good enough for a lot of purposes and it seems like maybe it is not going to head the way search did for example. We will show you, i think, some tape in the next hour from the ceo of baidu in china. He made a very interesting point. We keep talking about Large Language Models as this winner takes all and maybe there are two or three of them in china, they are not focused on Large Language Models, but focused on smaller models. You are seeing lots of models. It is possible that china has led the way in a lot of the tech it is possible that we will see so many models the other question, of course, we are talking about the economics of it. It is great for the chipmakers and everything that powers it, but it may be less we will see for the Software Makers because you have meta with the open platform called llama 3 which is good as claude or openai with chatgpt 4 if there are more open models that you access for free, it creates the economics of the other Large Language Models. They cost a fortune to use because people are buying up these chips. Andrew, i have been watching this morning this is the best people watching i have seen as we watch your camera shot. I cant tell you how many people are taking selfies of the arc de triomphe behind you. You are sitting in the most photographed places in france. The number of people walking up. We were just talking about youo many selfies youre crashing, how many vacation photos youre crashing because youre in a busy spot. Were crashing their photos or theyre crashing our photos youre there for three hours. Youll just be in a lot of instagram posts. You should get some a. I. To completely scrape instagram to see how often you appear. Thats our people watching. Some likes. Were going to have a lot more of our broadcast here from paris this morning, including more of our exclusive interview with french president Emmanuel Macron were going to talk and show you more of those comments, especially on china and geopolitics. Thats going to happen in the 7 00 hr. Ou dont go anywhere. Squawk box returns after this. Ah, these guys are intense. With e trade from Morgan Stanley, were ready for whatever gets served up. Dude, you gotta work on your trash talk. Id rather work on saving for retirement. Or college, since you like to get schooled. Thats a pretty good burn, right . Ameritrade is now part of schwab. Bringing you an elevated experience, 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. Harvard universitys governing board said it is declining to award degrees to 13 students who violated the schools policies by participating in a propalestinian encampment on campus that comes after 115 faculty members showed up to a meeting on monday and voted to allow those students to graduate harvards graduation ceremonies take place today this was Harvard Corporation overruling the faculty of arts and sciences and well see how this plays out when we come back, nvidia shares helping lift the nasdaq right now. Well dig through the report with an alanyst right after this squawk box will be right back. She runs and plays like a puppy again. His 2s are perfect hes a brand new dog, all in less than a year. When people switch their dogs food from kibble to the farmers dog, they often say that it feels like magic. But theres no magic involved. dog bark its simply fresh meat and vegetables, with all the nutrients dogs need instead of dried pellets. Just food made for the health of dogs. Delivered in packs portioned for your dog. Its amazing what real food can do. Nvidia shares are popping this morning the company not seeing any slowing of demand for its chips as it reported stronger than expected profits nvidia announcing a ten for one stock split and a dividend hike. Joining us now, vivek aria, b of a securities senior analyst. It feels like the enthusiasm behind the nvidia story, the multiyears of demand exceeding supply were confirmed for the most part. What are the headlines from the report from your perspective yeah, good morning. Thank you for having me. I think it is a global race that is going on between Cloud Service providers, between Consumer Internet companies, between on premise enterprise, between the thousands of venturebacked startups to take the best advantage of the wonderful and Amazing New Technology called generative a. I. Or Large Language Models. Nvidia is best positioned to deliver a turnkey solution to every one of the constituencies who wants to take advantage of this technology, either to lower their cost or improve their profile. What did we learn last night i think three important things first, demand is broadening, it is not just the Cloud Service providers. Demand is broadening to automotive companies, enterprises, to Consumer Internet Companies Second thing we learned is that the bank still exceeds supply. This was a concern going into the call because the companies in front of this major product do something called blackwell, there was a fear there would be this gap what theyre learning is just because of the breadth of product and the breadth of customers that theyre able to go through this transition very smoothly and the third and very important thing, which i think sometimes gets understated is that the fault line is not only growing over 200 a year, every dollar of sales is being converted to over 50 cents of Free Cash Flow. Which megacap company in technology or the market is able to do that while trading at 1. 5 to 1. 6 times the multiple of the s p 500 . It is checking every box of growth, execution and cash flow generation and the stock is still only about 30 times next year multimenple against most o the institutional shareholders. It is remarkable. You say you see a path toward perhaps 50 per share in earnings power within a couple of years so in the third year from here i guess the question, big f picture to me might be how long can a company sustain such a competitive advantage that theyre given such a huge generation portion of the returns for this entire investment cycle at these margins and producing that much Free Cash Flow, it just seems as if, you know, at some point capitalism goes after the margins. Absolutely, but one thing we have learned is in semiconductors there is tremendous value to scale an incumbency and obviously, you know, just in technology there is tremendous value to being the first in the market with the leadership position. So, if i look at the Global Accelerator market, this year we think it doubles to 100 billion and nvidia is 80 market share of that. We think it doubles again over the next several years and nvidia we think inventing that kind of market share, and, by the way, this is not too uncommon we saw similar multiyear product cycles when the Telecom Service providers moved from 2g to 3g, 3g to 4g, 4g to 5g, always performance cycle and i think were in the middle of the Upfront Department cycle and the final point i would make is that the price of entry into generative a. I. Is not cheap just to have a useful deployment, you need to have at least a 1 billion or 2 billion of capex you need 10 to 20,000 gpus to bring about anything useful. They are able to upsell to boards, systems and software thats why you see revenues get so big we still think they can sustain this for the next several years. Vivek, you laid it out nicely you have a price target now at 1,320 per share for nvidia. Appreciate the time this morning. Thank you. Thank you very much it is just after 7 00 a. M. On the east coast. 1 00 p. M. Here in paris. And youre watching squawk box right here on cnbc im Andrew Ross Sorkin with becky quick and mike santoli this morning joe is off we got a lot going on. Among todays top stories, boeing confirming to cnbc that certain jet deliveries to china have been delayed in recent weeks. At issue is boeing beijings regulatory review of batteries that power cockpit voice rec recorders. Boeing saying it is working with its chinese customers on the updated timing of their deliveries ending regulatory approval, adding the faa has already green lit the system meantime, the Justice Department, a group of state attorneys general reportedly set to sue Live Nation Entertainment over antitrust violations tied to ticketmasters control of concert ticket sales that is expected to be filed in new york as soon as today and would seek to break up live nation and ticketmaster. A lot of speculation about that coming and warner bros. Discovery and disneys espn striking a fiveyear deal for College Football playoffs, this includes broadcasting two first round games on tnt this year and next, an additional two quarterfinal games and then games available to stream on max andrew, thank you lets get a check on the futures this morning things are looking up and the green arrows keep pushing higher dow futures up by 33 similar story for the s p 500. It is the nasdaq that is the big mover this morning now up by about 185 points dom chu is standing by, hes been taking a look at the premarket movers everything ties back to nvidia. It does and the discussion that you guys just had, big one, with regard to the impact of nvidia and just with the future prospects is where were going to start with our morning movers right now to beckys point, the nvidia headlines are the talk of the town we know what is happening with the stock movements. It is up big it is also carrying over, though, as you can see here, to other enterprise, Business Technology stocks seeing benefitting from the Ripple Effect of nvidia, Ripple Effect for a. I. In general and Investor Sentiment. Check out semiconductor Companies Like advance microdevices, not nvidia, but still up roughly digital i cant find it up here right now, but anyway, amd was up, super micro up 5 . Hewlett, Dell Technologies among the Business Tech companies up as well. Even Digital Realty is up, a Real Estate Investment trust that doeS Data Centers youre seeing a lot of premarket bid there. Traders and investors watching closely to see how closely that can carry over to the coming weeks and months, whether that nvidia halo can encompass more of these companies speaking of Artificial Intelligence, another Media Company has now inked a deal with openai, news corp. Up nearly 2, now 5 for the class a voting shares. Thinner Trading Volume so far. This is the Parent Company of news outlets like dow jones, wall street journal, barons, new york post, amongst others, it is going to partner with openai to allow access to content from its various news platforms, that can help openai in the development and evolution of the chatgpt generative a. I. Model. Terms were not disclosed on the deal, but the wall street journal did report that the deal could be worth over 250 million over the course of five years. And well cap things off with an analyst call getting some attention this morning shares of under armour class a voting stock down 1. 25 . Very thin volume, around 10,000 shares or so one of the reasons why is a downgrade over at oppenheimert market perform, they withdraw their target price after having 15 before, theyre moving to the sidelines, they say, given what they think will be a longer campaign by the company and its leadership to get fundamentals turning more positive. For more on that story and other top analyst calls of the day, head over to cnbc. Com pro, subscribers get more access to details and analysis of the stories. It is all about the nvidia and the coattails. Ill send things back over to you. Even the news corp. Story you talked about ties back to a. I. And the promise of real money being generated for some of these things it is kind of amazing to see how this is what is driving everything, especially when yesterday the narrative was that people were starting to pull back and be a little concerned that the fed wasnt going to raise Interest Rates, and the other things that they were watching on the release of those fomc minutes the tale of two stories, again, and the one that is most dominant is the Technology One yeah. I think at some point remember when every Enterprise Company had to spend on cybersecurity, now they figure they dont have to spend as much on cybersecurity, but devote the resources toward a. I it is all about that kind of kn finite resource pie and all the companies deciding that the trend, if youre not doing a. I. , then youre doing something wrong, so i dont know how much longer that lasts. I think you probably need a. I. To play into the cybersecurity too. You got it. Dom, thank you. Andrew okay coming up, were going to give you a closer look at tech after nvidias results last night. And more of our exclusive interview with french president Emmanuel Macron in paris the conflict between israel and hamas, the u. S. Elections and so much more. Dont go anywhere. Squawk box returns from paris and the nasdaq after this. This is remington. Hes a member of the family, for sure. We always fed them kibble it just seemed like the thing to do. But. He was getting picky we heard about the farmers dog. And it was a complete transformation. His coat was so soft, he had amazing energy. He was a completely different dog. Its a nobrainer that remi should have the most nutritious and Delicious Food possible. Im investing in my dogs health and happiness. People couldnt see my potential. So i had to show them. Ive run this place for 20 years, but i still need to prove that im more than what you see on paper. Today im the ceo of my own company. Its the way my mind works. I have a very mechanical brain. Why are we not rethinking this . I am more. Im more than who i am on paper. Welcome back, everybody. The futures are sharply higher this morning dow futures up by 27 or 28 the s p futures up by 32 the nasdaq is really pushing things higher. Were moving towards a gain of 200 points in the futures this morning, up by 190 for more on whats moving the markets right now, we want to bring in mona mahagin at edward jones. Thank you for coming in. Awesome to be here. We have been talking about nvidia and the halo effect you think this technology rally is really warranted. Yeah, you know, it is interesting. Megacap tech has delivered this quarter. In this higher for longer rate environment, what were seeing is not only can these companies, they have fortress Balance Sheets invest in their businesses, they dont have to tap the market, theyre delivering value back to shareholders, buybacks, dividends, and, by the way, theyre getting a higher rate on their cash as well so, this is a pretty good, almost defensive story in the higher for longer environment. But, we also have the secular bull market in a. I. That is underpinning some of the bull market in the broader economy as well thats what i think is really interesting. You still think that this is broadening out and this is the rest of the stocks that maybe dont catch up, but start to feel some of the gains as well. Yeah, i think certainly from an a. I. Perspective, what were seeing now is the enablers of a. I. , the Semiconductor Stocks they have really kind of taken the bull by the horns. They are the first to see the price appreciations. As we think about where the productivity gains are felt, whether financial services, whether it is healthcare, those sectors those parts of the market we think will benefit as well by the way, as we look toward the back half of the year, fed rate cuts, looking at better earnings from those parts of the market, another couple of catalysts that can help as well. The by the way on this is, there are plenty of fed officials saying, yeah, i dont see any fed cuts, the remainder of this year the minutes yesterday sounded like they are definitely raising the bar, even jay powell himself sounded like the case for a cut is going to be much tougher to make. I think, you know, certainly we also think the bar for a rate hike is pretty high. But since the may 1st meeting, since the fed meetings came out, we have seen a slew of data points that have been, we think, supportive, so we saw our first inflation print that came in on the better side, it was cooler than expected or in line, we also saw labor market that looks like it was softening, retail sales were below expectations, and we had a bunch of retail names, target, walmart, starbucks, mcdonalds, telling us the consumer may be pulling back a bit this story of this goldilocks cooling the economy and inflation may be moderating we think will be playing out in the back half of this year. We did hear those notes struck by Christopher Waller of the fed taking some comfort in some of these signs of slackening demand. But i guess im reminded of what people were saying, like, late last year when they didnt believe the soft landing thesis, which was it always looks like a soft landing on the way to a downturn youre decelerating from strong growth to something not so great, what we look for to know if were going to stop short of something troublesome. It is a great callout we think the goldilocks scenario is still a base case, but probably one of the bigger tail risks is do we go more quickly into something deeper or more prolonged in the economy and certainly what were watching is one, the labor market we have seen unemployment rates still 3. 8, 3. 9 , near multidecade lows, but if you look at things like job openings moving lower, those are leading indicators of the labor economy, they are pointing to softening ahead. We look at the consumer not only retail sales where were looking at things like Credit Card Debt levels elevated, some signs that the delinquencies are picking up as well, all of those signals still coming from the lower end consumer, so not much a broadening out to the broader economy, broader consumer, but more broadly we havent seen red flags yet. All of those are yellow flags, but were watching those signals carefully. Were watching the unemployment rate, see if it ticks up much beyond 4 . We dont see that yet. We continue to see this base case of a moderation to trend or maybe slightly below trend, economic growth, but thats good for inflation as well. What do you tell people to do right now . Yeah, it is a great point we had our first correction in april, s p was down 5. 5 wasnt really a correction. 5. 5 . It was very modest, you know, historically speaking, we dont think thats the last correction were going to get this year were heading towards an election season which is volatile but the what we tell people is that volatility, if we dont see anything deeper for long bear market coming out of it, we dont see a recession, dont see the fed raising rates, thats the opportunity to not only diversify, to make sure you have not only your a. I. Basket, but your nona. I. Basket, so you need the 5 pullback or an actual correction down 10 . On average, you usually get one 10 correction a year. That be with a real opportunity, but given this market environment where we still have some cash on the sidelines, where people are still buying, when they see the opportunities if it is 5 pullback, we could be 5 higher before you get the pullback yeah. I think the bull market has lines, we say get invested when you can and stay invested for some time. Mona, thank you. Thank you, guys. Andrew . Thank you, becky when we come back, right here in paris this morning, more of our exclusive interview with french president Emmanuel Macron. His thoughts on inflation, Monetary Policy, the situation in the middle east, the u. S. Elections, and decarbonization all of that and more in just a little bit. Later, stopping Antisemitic College chaos. A number of University President s on capitol hill today to testify about agitators on campus, chair of the education and Workforce Committee joins us for a preview. Were coming right back from paris and the nasdaq in just a moment announcer time now for todays afrac trivia question. Which was the first u. S. State to allow women to vote the answer when squawk box returns. M. First word. Tonsillitis nostril uhuh. Bill uhhuh. Hiphop limping mmhmm medical bills uhhuh pancakes cash who pays you cash when you have medical bills . Grrr no idea. [tapping] gap the gap left by Health Insurance . Who pays cash to help close that gap . Aflac oh, aflac get help with expenses Health Insurance doesnt cover at aflac. Com pictionary . doors lead us to places weve never been. Your dedicated fidelity advisor can help you open those doors. They can help you create a retirementincome plan designed to balance growth and guaranteed income. And provide access to specialists who help with Estate Planning to look out for future generations so youre not just growing and protecting your wealth. Youre sharing it. Because doors were meant to be opened. Great job, everybody announcer and now the answer to todays aflac trivia question what was the first u. S. State to allow women to vote . The answer, wyoming. In 1890, it became the 44th state and the first to allow women to vote. Welcome back to squawk box. Were live in paris this morning, where i sat down exclusively with french president Emmanuel Macron in a wide ranging interview among the topics, the economy. European central bank widely expected to cut rates next month. I asked president macron how worried he is about the value of the euro and whether it is going to weaken if the ecb moves before the fed i do think about that im not so worried about the issue. I think the guidance is clear, and it is a big decision this is an independent body. And i think the guidance is clear and normalization on both sides of the ocean and, by the way, look at the situation, i think our economy did quite well to fix inflation without killing too much growth, and i have to recognize we are fixing inflation issue and in france, we still created private jobs during this period of time, which is quite unique. So i think we are during a normalization process post covid, war, inflation, it is good i think we need probably a bolder Monetary Policy im not worried by the short end of the ecb following the fed, you dont just take into consideration inflation, but growth and Jobs Creation is taken into consideration. I do believe that ecb has to complete inflation as a target by just creation growth and our recovery because decarbonization will create de facto inflation for sure because you increase the cost of a lot of goods and products and it is a fragmentation of it would create some embedded inflation. I think we have to complete the mandate. This is a very political question that is much more efficient for europe and growth. And the issue of europe, lets be clear, is to succeed decarbonization. France is back on track since 2019 and we are issuing today the right figures, as we created jobs and growth. So it is visible and were back on track but we need growth this is the main issue for europeans. My final economic question, a global one, who should ultimately pay for the rebuilding of gaza when that moment arrives i think it will be part of the peace treaty or a treaty for the day after, i would think for me the most important thing first is the humanitarian situation right now. We speak about why we do ask for ceasefire number one, ceasefire, humanitarian situation number two, before rebuilding gaza, it is political solution who would rebuild and how would pay for gaza if you dont have a political solution, meaning the twostate approach and palestinian state in charge. And for me, in the condition of this palestinian state there is a recognition of israel and the recognition of the Security Office as one of the key and fundamental elements of the states and this is, for me, the main way to say the security of israel is part of our our top priority palestinian state is a good thing because this is a relevant and fair request from palestinian people, because it will provide peace in the whole region if there is a recognition of israel and the security as this constitution. Third, who would pay everybody will come around the table. You have a lot of deep pockets in this region a lot of them could be ready to pay if this is about security, stability of the region and as a part of the broader picture, this is how i see the situation. I also asked president macron about what he thinks about the potential impact on the Paris Climate Accord and the larger economy if the former president , former president trump, is elected again. I dont speculate on any elections and especially the u. S. Elections, so i dont want to make sort of impossible scenario but whats important is once u. S. Decides to we consolidated the rest of the and this is the first time we used to have turkey to stick to the agreement and sign and ratify i think it would be a big mistake for u. S. It would be a big mistake for the planet, big mistake for u. S. Because u. S. Is u. S. Decides to leave the agreement, it will be a perfect occasion offered to big carbonized economy not to do their fair share. You worked with him before. What did you learn about working with him do you think there would be a way to persuade him to remain in it sometimes i succeed, sometimes i failed so im very humble i do my best i will do my best to convince him if he were president and i will do my best when i think it is a good idea, President Biden we work very closely as well as with the administration. I think the u. S. As first economy of this world, very Important Role to play to decarbonize its economy. And by the way, i was not happy with Inflation Reduction Act because it was not good for the europeans, but i have to recognize it is good to decarbonize the u. S. Economy, because it attracts a lot of clean tech i think it was a smart, low for your economy, your jobs and for Climate Change at the global scale. So, my objective now with u. S. Administration is to work very hard, first to be sure that we synchronize our agenda i think the u. S. Has to regulate a little bit more the business secure to be sure there are more compliant with Paris Agreement and the europeans have to invest more because we regulated much more than others, but we are not investing at the right scale were going to bring you a lot more of that interview with french president Emmanuel Macron still to come, including his comments on the Regulatory Environment in europe and calls to break up big tech hes got some provocative things to say as well as about china and tiktok well bring you that in just a little bit, mike yeah, andrew, interesting comments he had about the idea of broadening the mandate of the ecb away from a sole focus on inflation. Not sure hes got buyin from all the other members on that. But interesting that he is proposing that. Germany. Exactly, yeah there is a lot more comfort in europe about the inflation. Germany is particularly concerned given its history. Thats the whole basis of a lot of it, yeah. Andrew, thanks. Coming up, housekeepers are cleaning up in palm beach. The shocking salary numbers are next here are the futures headed for a positive open on the broad averages s p 500 up about. 6 , nasdaq nearly00oi gn. lbe 2 pntaiwel right bac the demand for service jobs in wealthy palm beach, florida, is reaching new extremes it led to bidding wars for housekeepers and exploding salaries robert frank joins us now with more on this story it is expensive to be rich. Thousands of wealthy new yorkers moved to florida after the pandemic they bought big homes in palm beach and miami, they need cleaning the problem is there werent enough experienced cleaners. Now, floridas wealth boom has touched off a housekeeper shortage salaries for experienced house keepers in palm beach more than doubled since 2020 the typical salary, get this, is now 110,000 to 150,000, including overtime, 401 k s and Health Insurance most housekeepers are asking 50 an hour or more. Staffing agencies say some executive housekeepers, where they clean and help manage the cleaning staff, are topping 200,000 and bidding wars have become common. Ive never seen anything like it i mean, to go from 20, 25 an hour to such a hike in such a short period of time, it is i really it is really sur surprising to us now, hotels and resorts also have a shortage, but thats a different labor pool since housekeepers for the wealthy need specific skills there is also higher demand for chefs, nannies and butlers, hospitality managers now but need for those staff not nearly as high as for housekeepers you can read more about the housekeeper shortage and where the wealthy are investing in the new inside wealth newsletter, just went live, right now, you can head to cnbc. Com insidewealth to get all of that in the new newsletter. So, those salary levels, i mean, this is a full time person that youre employing for the most part . Absolutely. And it is this perfect storm where you have, you know, the big problem with inflation now is Wage Inflation in the Service Sector thats the sort of apex of that. You have this huge wealth migration to florida, which sort of in some communities doubled the need for housekeepers. And then you have a wealthy Consumer Base that will pay whatever it takes to get the staff. And so, those three things coming together, this really is the ultimate sign of Wage Inflation in the Service Sector. Were seeing it in california restaurants, and were seeing it in cleaning staff throughout the country, but no more than what youve seen in the houses that were looking at, this is not, like, a normal persons issue these are 30,000 square feet houses that often have three or four housekeepers, and the demand now is for the executive housekeeper or head housekeeper that not only cleans, but also manages the staff, and there is now going to be a Training School in palm beach because they cant find qualified candidates so now people are making money from training the housekeepers because there is so much demand. Your first comment was the best, it is tough to be rich these days but, look, look, great for the housekeepers that means it is really tough work, they were probably being underpaid before and so great for them. Yeah, no doubt about it and i mean, what does it cost to live in proximity to palm beach . In other words right, and there it is good, lets say the hamptons, in palm beach, west palm is two minutes across the bridge, and thats a vast community, much more affordable so because that has hield wages down in the past there is not enough people with experience in wealthy homes to fill these jobs. It is crazy. Doubling in three years. This was even a booming industry, or anything that was there has to be trickle down effects that go all the way through so that it raises wage levels for everybody which is good good for them. Yeah, it is whethen we come back, a numbr of University President s will be on capitol hill today answering questions about campus protests and antisemitism we have a preview of that hearing next right now, though, as we head to a break, lets get a check on shares of nvidia this morning after last nights blowout quarter. Check it out that stock up by 7 , a thousand dollars yesterday for the first time, right now, 1,017 is in the premarket. The announcement that that stock is going to split, 10 for 1, which should be very interesting to have easier access for Retail Investors too. Well have much more on the big tech story and a. I. In our next hour with investor gffeweo lis squawk box will be right back. Just stop calling each other rock stars. And using workday to put finance and h. R. On one platform. Tim, you are a rock star. Using responsible ai doesnt make you a rock star. It kinda does. You are not rock stars. clears throat okay. Most of you are not rock stars. Oooh. Data driven insights, and Large Language Models. Oh, thats so rock roll. It is, right. He gets it. Yeah. Welcome back to squawk box this morning, Congress Continues to investigate antisemitism with protests on College Campuses leaders from northwestern, rutgers and ucla planning to testify today about activity happening at their schools and the safety of the jewish students joining us right now is congresswoman fox. Good morning to you. Tell us what youre hoping to get at and, frankly, what changes youre anticipating may come. Well, what were hoping to get at is a change in attitude and behavior on these campuses, where the president s take seriously the threats against the jewish students. The jewish students who are being intimidated, harassed, threatened, and assaulted. And thats not acceptable on campuses in the United States. So, we want them to take seriously what has been happening and see that changes are made students should always feel safe on University Campuses are you prepared to withhold federal funds . Do you see that as a true possibility . There is a true possibility of federal funds being withheld. But we have to continue our investigation and we want to see action these president s can solve this problem if they will take the appropriate action and make sure that the harassment, the assault, and all the other negative things that are happening on their campuses stop we just want to return to a time when students can feel safe on their campuses what is your sense of how we got to this place and why do you think that campus president s and College President s have not acted as swiftly as i think you and so many others would like them to . Well, i think we got to this place after the october 7th attacks by hamas on israel, that there were if you want to say it, people waiting to bring forth these protests and so we saw them spring up, what seemed to be spontaneously across these campuses and we want to see, again, a return to the normal behavior. Although we know from our investigation that there has been harassment and there has been intimidation of jewish students going on for a long time we have reports going back as far as 2016 of things happening on campus that shouldnt have happened, and those things being reported to the president s what we found out from all of these president s is that they have lousy processes on their campuses for stopping bad behavior they have convoluted appeals processes, different groups of people that handle bad behavior, and they all know that they have to make changes in their systems. And they all are saying they will do that i meet with each one of them ahead of time, at their request, and i am able to talk through a few things with them and they all tell me that they the unprepared for what happened and they have to do better we have seen a number of the College President s who have been called before you to this point, who have basically lost their jobs, been forced out because of answers they have given in their testimony in front of some of the committees why these three in particular and im asking as a rutgers graduate, do you think these three president s belong on the hot seat well, yes, we think they belong on the hot seat because as i said, there have been reports for years of bad behavior on these campuses that have not been dealt with by the president s, by the administration and so, if you our letter is out there to the president s, you can read them, and we outline behaviors that have occurred, students being harassed, students being assaulted, students being intimidated, even faculty. And they have done nothing and so, yes, they deserve to be brought in, and for congress to do its job as oversight, taxpayer dollars, billions of taxpayer dollars are going to these institutions, and were basically funding terrorism, intim intimidation, harassment, taxpayers dont want that to be happening on the campuses. They want accountability from these president s and thats what were asking for congresswoman, before we let you go, curious what you think about the reaction from the Business Community a number of businesses said we shouldnt be hiring these students and there issome complication are you not going to hire students that have been involved in demonstrable antisemitism and demonstrable harassment,and those who participated in protests and how those protests have intersected with antisemitism, but in some cases may not be considered antisemitism how do you think about that . Well, im not going to tell future employers what to do, but we all know that they search the internet, they search to see things that have been said and done by people before they interview them for jobs, and i think that thats up to each individual employee, employer as to what they want to consider in terms of these students. But, it is obviously bad behavior on the part of a lot of them now, we also know that on average about 40 of the people participating in these demonstrations are outside agitators who are helping to do this so, it is not all students it is a mixture of students, faculty, maybe staff, and students so, im not going to tell employers what to do in terms of employing these people, but i sure would be concerned about a lot of the behaviors that have occurred if i were an employer looking for somebody to come into my unit congresswoman, we appreciate you joining us this morning. We look forward to that hearing today and following the progress of your work, thank you. Becky thank you thank you, andrew when we come back an antitrust suit against live nation is expected to be filed today we will talk about the dojs case and what it means for the company. Right now, though, as we head to a break, look at crypto this morning. Bitcoin trading just below 70,000. Ethereum at 3,868 squawk box will be right back. Food isnt just fuel to live. Its fuel to grow. My family relied on public assistance to help provide meals for us. These meals fueled my involvement in theater and the arts as a child, which fostered my love for acting. The feeding America Network of food banks helps millions of people put food on the table. When people are fed, futures are nourished. Join the movement to end hunger and together we can open Endless Possibilities for people to thrive. Visit feedingamerica. Org actnow welcome back to squawk box. Right here in paris this morning, tech ceos from around the world descending on france, including some of the biggest players in Artificial Intelligence here is what former google ceo eric schmitt said yesterday at viva tech about regulation. The regulatory mindset assumes you can regulate the stuff without inventing it that doesnt work. One of the reasons that im here and one of the reasons that france is so important is that youre building it and also working with the regulators. It is the only path. So thats why im so proud of what under president macron and all the people i work with and theyre fighting brussels literally fighting instincts to control, right the way Innovation Works is you have to invent it and the inventors have to work with regulators to understand its implications if france doesnt succeed, then europe will not be a major player in this, the development of this new form of intelligence which would be a great tragedy for europe and baidu ceo who flew in spoke and added this provocative comment. The large model in the u. S. And probably including europe, everybody is focusing on coming off this most powerful, most cuttingedge foundation model. Right . But in china, although there are also hundreds of foundation models, people are increasingly talking about whats the super act for an a. I. Age . What is the native, a. I. Native app . And that point became a huge discussion at the event yesterday here in paris. Bringing you a lot more from paris in a little bit including our interview with Emmanuel Macron after this, just a touch weighing in with this weeks on the other hand segment and well continue to show you the esenusive interview with pridt macron and his thoughts on china. Were coming right back. Help make trading feel effortless. And its customizable scans with social sentiment help you find and unlock opportunities in the market. E trade from Morgan Stanley energy fuels, a leading american uranium producer, is ramping up production to supply expanding Nuclear Markets and diversifying into rare earth elements, key ingredients in many clean energy and defense technologies. Energy fuels. Dupont announcing it will split into three separate publicly traded companies. Thats the electronics business, water business and the new dep deponte, brands including kevlar and nomax. It expects to the complete the separation within 18 to 24 months the company also said the ceo ed breen will transition to executive chairman and that cfo lori koch will become the ceo. Effective june 1st see the stock up this morning 5. 25 taking a page out of ge and other Companies Split into multiple pieces. Ge, honeywell, itt. I can go back farther. Industrial playbook. Snowflake shares higher missing estimates. Revenue beat, it raised its fullyear forecast first since surprise departure of the companys ceo shared higher by about 4 . Chatgpt creator openai in the spotlight Actress Scarlett Johansson claims it effectively copied her voice did it cross a legal line . Just a touch is here to weigh in. Yeah, this is messy, but, no. Openai probe didnt break the law and the Washington Post has reporting we can talk about. This started brewing last week when openai launched ed gpt 40. Using a realistic voice to ask questions based on what it sees from your Smartphone Camera and even seems to have emotionss 20 years ago a talking computer, how . Deadpan a. I. System from the movie 2001 a space odyssey. Today reminds us of samantha from the movie her. Sam altman says her is her Favorite Movie and tried to get Scarlett Johansson to voice the openai the sky voice doesnt sound much like her Scarlett Johansson an alist actress but doesnt have an immediately recognizable voice what voice actor call a general american accent like whoevers voicing scott. Sounds like the movie from succession or uma thurman or apples voice except with an actual personality. In the clear, even though made this approach what other issues and what kind of complaint does she have here . Yeah. Micro, on the other hand it is clear that openai is taking what it wants to feed its hungry a. I. Models justification, humanitys future depends on it. In other words, Silicon Valley has a p promethias stole and gae it to mankind. Master school music early 2000s, youtube from tv and hollywood and 2010s taxis from cities. Justification as prometheas is like a rollup of alltans want ware smart enough to do our work for us even if openai didnt steal the actors voice feels might have violated her right to publicity creating a Software Program so closely related to her performance, ceo described what they created if you want to use somebodys song in a movie, somebodys picture and ad you need permission and probably pay. This feels that way. Also the case, well, that was actually a character she played. Its the probability of the studio. Yes. Wasnt necessarily scarlett joe hances. Sounds a little like it the idea reaching out to her, the tweet, her, only heard a little of it she has a distinct sort of gravelly voice at time sounded a little i need to hear more to hear it out. Feels like they were going for that same effect. True in the sense when i first saw the demo i thought, oh, well, this is interesting. Then i heard this oh. Scarlett johansson does sound like her. Last night i listened to a british actress. Australian. Thank you not an american actress trying to do a general american accent of somebody who grew up, upperclass. Sounds exactly like that so, you know if you close your eyes and play xash Scarlett Johanssons voigt, woul voice, would you know it was her . Probably not, if it was just cold and just hearing it interesting to me, what do you make of this, jon, if, in fact, openai is so intent on this level of branding. In other words, its not like our Magic Technology will sell itself and just be so much better no we have to actually have a thing evocative of this character we know. This is just scraping the surface of what theyre actually doing. To train these models into, steal, like you said, roll up Everything Else and roll into it have a new deal Just Announced with news corp. To play the journals reporting 250 million over a few years expensive. Money coming in at this point . I think its cheap. Compared to what theyre paying paying for the chips, whatever. Yes but if you have to do that again and again and again and cut that deal with every single group that youre taking their information from. A lot of money to be made, as jensen well, at least it doesnt sound like Arnold Schwarzenegger the newsletter, qr code on the screen type in cnbc. Com otoh if you prefer to et good are i dont fingers moving full text of both arguments and share. Thank you, jon. It is 8 00 a. M. On the east coast. You are watching squawk box right here on cnbc im becky quick here with mike santoli here at the Nasdaq Market site in times square. Andrew ross sorkin is isnt paris and sat down with the french president Emmanuel Macron more of that interview in a few minutes. Among todays top stories, Jpmorgan Ceo Jamie Dimon says a hard landing cant be rouled out speaking at a summit in shanghai, the worst outcome for america, stagflation the story he said before and sticking to it speaking of shanghai, tesla breaking ground there on a new facility its slated to make socalled mega pack Energy Storage batteries with production set to begin in the First Quarter of next year. And toronto will be the first nonu. S. City to get a wnba team paying 50 million for the yet to be named team kilmer is led by larry ti titembaum. Owns the raptors play begins in 2026. Check on futures in the green all morning long and in fact picking up steam that holds on too. Dow futures up by more than 50 points s p futures up by 34 and the nasdaq indicated up to more than 200 points now that continues to grow 100 in the quarter. Is it nasdaq ten year up, at this point, 442. Two year at 487. Want to get over to dom chu with a look at the mornings premarket movers. Focus on technology today, dom. Heavy and to your point, nasdaq, s p drive. Start this top of 8 00 a. M. Stock just about everyone is talking about. Blowout Earnings Report from nvidia after last nights close. Almost singlehandedly driving the tech sector. Up about 7 after the worlds most valuable computer chip Company Reported better than expected Quarterly Results and gave a better than expected forecast, and announced a 10 for 1 stock split and boosted dividend payment, even though a very small amount. Such a thing as an earnings superfecta, this is likely it. More perspective, seeing in premarket, nvidia opens at a new fresh high, adding 165 billion in market cap. That is roughly the size of adding an entire dow component like amgen or verizon at opening bell nvidia top of the town a. I. Coat tails catching other Tech Companies premarket gains for other computer chip makers, micro devices, broadcom and others as well highend computer server makers, super microcomputer as well. Even in positivity for Digital Real Estate companies. Right . Data center companies. Look at those names. Digital realty 1. 25 as well cap things off with the Enterprise Technology space ecosystem as well. A couple analysts calls helping to add tailwinds to more than just nvidias tailwinds. Dell and enterprise getting both added to the tactical outperform lichte of evercore ahead of respective Earnings Report expecting better than expected results for prints in both for more and other top analyst calls head to cnbc. Com pro subscribers get more details, analysis in those stories, mike. Nvidia, tech, the whole ecosystem all up going to be the talk for a while. Sends it back to you. Fascinating, dom. Center considering jensen wang after the Earnings Report yesterday pointed out the reason were getting all of these orders, reason demand continues to abstract supply, because everybody in this world said theyre going to get a massive return on this investment. Now, whether we know thats the case for everybody or not, it is really interesting the companies that are actually writing the checks, like the hps of the world and other Cloud Services companies, are also being treated favorably by the market. Not just that i mean, this is almost like a selffulfilling prophecy right . The more these things happen, the more covers they get in the news, the more that drives Investor Sentiment the more the customers like the kp computer Chip Companies and those who use their products, the businesses who biservers and everything becomes a circle ecosystem, the cycle that happens. You dont know what breaks the wheel, i guess a big point. What thats going to be. You mentioned stock split element here we all know its kind of cosmetic shouldnt matter fundamentally i waentent back and looked. Alphabet and amazon 201 stock splits a couple years ago. Excited about it dating back the nasdaq 500 from then to now but something Retail Investors tend to like makes it more affordable and the Options Market makes a difference if you can have a smaller dollar value. Absolutely. Options worth 100 apiece smaller in terms of volume, hehem helps. 30, 40 years before fractional trading and whatnot might have made a bigger difference these days go to any broker buy 0. 1 of nvidia and still get it. Exactly practical purpose not there anymore. For employees paid in stock, helps to have smaller bits to sell as walmart mentioned. Dom, thanks. Coming up, the department of jut is reportedly getting ready to file an antitrust lawsuit against ticket live nation joining us known as the architect of the biden antitrust policy stay tuned. Coming up on squawk box when we return, my exclusive interview with president macron. E were talk about china, big tech and u. S. Politics. At Morgan Stanley, old school hard work meets bold new thinking. To help you see untapped possibilities and relentlessly work with you to make them real. Lifes daily battles are not meant to be fought alone. Were not powerless. So long as we dont lose sight of whats important. Dont be afraid to seize that moment to talk to your friends. Cloud, you okay . Because checking in on a friend can create a safe space. The first step on our new journey. You coming . Reach out to a friend about their mental health. Seize the awkward. Its totally worth it. The department of justice planning to hit ticketmaster live nation with a lawsuit today. Lawmakers an consumers have gr grown frustrated with the giant. This after a botched sale of taylor swift tickets joining us right now on the expected andy trust fight is a columbia law student and special former assistant to the president for technology and competition policy and, tim i will say a lot of times i spar with you thinking that the Justice Department has gotten too overreaching with thing. I dont think youll get as much pushback on this ishue. Textbook of rapacious monopoly a lot of it comes from this, you know the United States government allowed them to merge in 2012 or so. That ended up, live nation and ticketmaster a big mistake. Yeah. At the time, they said that, dont worry. Were not going to use our monopolistic forces to punish venues who dont use us or cause ticket prices to go up has that been the case a lot of this is confidential but reporting suggesting and a lot of anecdotal evidence used power over ticketing and booking to control the industry and they have over 70 s 80 venues ever tried to buy something outside of ticketmaster . After the Second Market do it, sell it back through. No more evidence that the idea over the last year people traveling to europe to go see taylor swift because you can pay for plane tickets, Hotel Cheaper than tickets here in the United States in fact, that happened to, a family just did this onset back here, but his family just did the same thing it was cheaper to go to stockholm. And areas where americans are paying more for no particularly great reason we pay more fees than any other country. Ticket Prices Higher a monopoly found a million different ways to do this and its overdue. The kind of thing government should be doing. Flap back maybe pay more because we are the americans paying for experiences right now. We have seen a lot of cash that people have on hand. How much is that responsible for this you know, arent exactly poor either americans pay a lot more like pharmaceutical drugs, medical services, you got to ask, whats going on the answer, market failure and the antitrust kind of like give americans fairer prices and have them pay what people pay in the rest of the world. Eyeglasses, we pay in most countries. So many markets we pay just too much. Whenthe merger was approved a known potential risk down the road this would be anticompetitive, i guess. Supposed to be behavorial remedies or behavioral rules they were supposed to adhere to. Unworkable to craft something that says they have to essentially be more transparent or arms length about this the law authority, antitrust, behave usual stuff doesnt really work. Make promises and do what they want to. 2012, a different antitrust enforcers was more optimistic they would follow the rules. They didnt. Investigated earlier its been a mistake and the government is basically saying, all right. We tried this behavioral stuff, time to go structural. A breakup, by the way, seek a breakup. What it looks like. Most obvious separate live nation and ticketmaster. They need to do more, i hidont know basic starting point, why its the largest produces the largest booking agent in the entire country, largest ticket and talent and ripe for abuse. Efficiency that i dont think they have, an arguable case theyre the only ones able to do this. Sort of seems like studio broken up from theater ownership back in yeah. Fair enough. Now talking about bringing it back because theyre in trouble. So stock down 6. 5 this morning, but 9475 the last tick how long would it take to play out, and if the government does move to break the company up, what does the new world look like at that point yes i think it will take a while maybe a year, two years. They move quick as they can but need to have filing in court i dont think the Justice Department will settle easily. I think hold out they made that mistake before, sadly. Reresydivous company. Does this change with a new administration i think no candidate wants to be in fager the ticketmaster i love this monopoly making American People miserable. Politically, i dont think either sides wants to take on this. And sort of an industry utility kind of natural monopoly type of tendency in certain businesses that maybe just, it just happens this way like every argument like that so did bell in the 80s. Ibm said there should be one computermaker. Us those arguments are always there. You hear them. In terms what will change, a huge opportunity theres a lot of profit a lot of opportunity for someone, ticket selling entity people like better than ticketmaster would you buy from someone else if you can have having a hard time playing devils advocate because i dont have a huge amount of empathy for what theyve done. I dont have empathy for it but i think the inherent massive supply demand and balance related to everybody wanted to buy taylor swift tickets at that moment you need a system that verifies every single person. Only sell each ticket once is not easy to do. Youre right. And i dont necessarily, i dont blames they necessarily for that the things that went wrong with the taylor swift concert give you that 100 i dont know. The thing with a monopoly they dont have incentive to do that much better. What happens people are upset not going to leave us. Still want to do this. I agree there are some Market Forces here. My daughters really want to see taylor swift, and spend all of their money on that, they would. I get that not everything hidden behind that saying thats why we dont have a monopoly. And public back in the 90s against ticketmaster and lost. Maybe more opportunities for the artists as well. Youll see a Charm Offensive from a lot of celebrity artists saying ticket master and live nation is the greatest they have a lot of power over the artists. A big tour or smaller tour artists say i love these guys, and then a little stockholm syndrome situation interesting tim, thank you. Pleasure. Andrew . Coming up, when we return, more of our interview with french president Emmanuel Macron right here from paris this morning. Youre going to hear what he has to say about tech regulation, china, tiktok and the upcoming olympics and the relationship between russia and ukraine were coming right back from paris, right here on squawk box in just a moment. Wall street forecasts over 100 billion in sales for weight loss drugs known as glp1. Even with unliked and inconvenient injections, dehydratech processing of a glp1 drug demonstrated improved blood sugar reduction and reduced side effects. More human Study Results for lexarias patented oral Delivery Technology are coming soon. Lexaria bioscience, transforming the future of glp1 drug delivery. Exciting music. [mud splat. ] [bird squawk. ] and thats why i never drive those guys. The partys over big guy were tired of hearing i dont wanna get my truck dirty. with weathertech lasermeasured floorliners front and rear. A seat protector. And full bed protection. Trucks are totally covered. You just got weatherteched. Yeah, buddy. Lets get dirty. [bikes in mud. ] drive worry free with these American Made products at weathertech. Com. Welcome back to squawk box. This week in paris i sat down with french president Emmanuel Macron in an exclusive interview. Theres a view in the United States some regulations coming out of the eu are meant to effectively try to break up if they could, the u. S. Tech giants i asked president macron what he thinks about the Regulatory Environment in europe in big tech and what it all means for compet compe competition. I think its wrong but when your government elected government provide guarantees to your people. For instance, if i want to pull back governance of privacy, a use of the cloud, this is a sovereign and important democracy issue. As european governments, if your citizens use at 90 persons u. S. Platform, what do you do you say, okay. Im sorry. I cannot i cannot guarantee you privacy because you use a platform not under regulation. This is changing our system and we dont live in democracy anymore but in a system with the key elements decided by piloting companies in another i think the point is i dont regulate you when operate in u. S. Fine be sure when you operate in europe continent you have to respect european rules and guess what this is exactly the same when European Company operates in the u. S. Can you imagine one u. S. Company arrive, European Company will arrive, imagine european bank, and its decides not to respect the u. N. Regulation. Never, ever. This is insane so we want to be respected and we just want to say, we have our, our differences we do believe in innovation. We do believe in Digital World but we think that privacy with thing with respect to data, why fake news, with a. I. Everything which can dive at point of time, system of rule of law and model of democracy its normal we want to protect and put in regulations in place european, u. S. , chinese, also players. Im curious whether you think that tiktok is a National Security threat to you here in france thats what its described as in the United States where its likely to get shut down. No. I think you can have issues with users platforms or algorithm and so on. I think this is a good debate and a debate we raised in europe with a directive even, precisely on the digital activities. You dont think its a National Security threat not at this point in time some issues could be part of it but we didnt use this approach, and we are neutral in terms of technology, nationally what we want to regulate is users. For instance, any platform could be an issue if it provides threats to our children. Bullying hateful speech if it doesnt guarantee a reasonable time this this this in all continents. One. Places in regulation where is we can penalize or shut down a platform if the platform doesnt respect the rules but no internationally. You just did that in the case, in new caledonia. This is a local government. And they did it, because it was used, lets say, misused by, for the riots by very violent people we respect we didnt force or forbid local government. Its their decision and not the decision of the french government but i think seen as useful given the misuse of the platform. You think it was the right decision i think it was given the period of time but its not supposed to last, and i think in the hours or days to come they will go back to normal situation. You just met with president xi of china. Curious what you think of this the commerce secretary in the United States refers to china the biggest threat weve ever had. Do you think thats the right way to talk about china . Look, i think china is a competitor when i speak about trade innovation and economy i think we should work much more collectively in order to to push them to be compliant with International Rules instead of deciding ourselves not to respect International Rules also i speak about trade rules and so on so this is a competitor and why since i do back the Commission Requirements and so on when they have working at cities and when you dont have a similar Playing Field but they are quite good in terms of creating innovations and producing. We work to now and today less protective to economies in the u. S. And we have to adapt or strategy to be clear, its a rival. When we speak about human rights dont have the same values and big disagreements. But this is a partner and we need them. Its impossible to fix Climate Change its almost impossible to fix as well as a big job political prices without engaging with china. I think this is why we have to clarify agenda in terms of trade and be clear and respectful, but defend our interests when we speak about these disagreement and trade and the economy, but we have to do our best to engage them on the big issues of this world. Look, i mean, if the u. S. Didnt engage in 2015 with china, just forget agreement we did this big progress on Climate Change the Paris Agreement, because of the u. S. Chinese convergence on Climate Change and this is for cities, true for climate and so on and in that regard china is an important partner for the u. S. And europeans. Talk about china in the second two pros before the olympics one of the things you got china a truce in ukraine during the olympics putin has said he wont have a truce. What would have to change to get a truce . Look, a truce is not for me the end game sustainable peace is the end game i think its very important, first, this is a tradition, and its very important to use as window during one a tradition to have a truce during during olympic games. Right. I think this is a very good important meeting. First, diplomatically precisely to engage with china and others and okay. Youre on the peace side help us to do so and second, to maximize a lot of pressure on those who decided to launch a war this is why, i think this is a big clarification moment, because every week until now president putin was claiming to be available for peace. Right. So today we enter in realtime, money time i would say for peace. Say, already, ready to start 26th of july 12th of august says, no, im not ready. So for everybody in the world its clear hes the one that decided to launch this war and he is not ready to make peace. And, guys, theres an ancient tradition gawkoing back to the greek traditions during the olympics not have have wars. Putin didnt want to do that and the russian team is notallowed to play as a team. To the extent athletes are here, neutrals, play independent not to participate in the celebrations and the like, but a story thats not going away just two months before the olympics i mention we have the entire interview with president macron coming up tonight at 8 00 p. M. Eastern time right here on cnbc. So look out for that thanks, mike yeah, andrew. So much great stuff, really clear laying out of his world view economic and otherwise there we got a lot of color on that. It is now time for a little bit of Macro Economic data as equity futures look for gains initial jobless claim on the way. Rick santelli standing by at cme in chicago do you have the numbers . Yes yes, and michael, as were talking, ten year note yields trading below yesterdays 440. 5 low yield. Keep an eye on that. Initial claims vicinity 220,000 comes in on the light side 215,000. 215,000. That is the lightest since the last week in april, and just to put a face on it the first week of this month we had 232,000 initial claims that was basically the highest level since last summer. Thats how low these have been trending, and last weeks 222 moved slightly to 223. Continuing claims, another week under 1. 8 million. All of last month and now the first two weeks of reporting on continuing claims. 1 million 794,000. And that actually is very close to last month, but then they revised it down. It was exactly the same last month. Now becomes 1 million 786,000. So we continue to see below trend expansion and initial continuing claims. One of the big drivers, of course, that paints a picture of a strong labor market which should put rates a little higher, but we are seeing more of a response to yesterdays uptick on the minutes to the last meeting we continue to see many different moves around the globe. One i would like to point out, german two year notes have moved towards a sixmonth high on stronger growth, and their pmis, which were at the oneyear high. So we want to pay very close attention to the changing dynamics in europe so stubborn inflation and some expanding growth should make for some very interesting relative value comparisons between our central bank and the European Central bank, because both have been hintingabout eases, and a least in the case of u. S. Central bank, maybe those eases are not coming as quickly as one would have thought, but certainly seems as though the markets are dealing with some of those changing dynamics. Back to you, mike, and the gang, on squawk box. Rick, thanks so much. Yeah you mention, yields still on the tamer side see if they react more to the firm claims numbers in a moment. Coming up, much more on the markets and jamie dimons view of a possible hard landing for the u. S. Economy plus openai investors geoff lewis will join us stay tuned squawk box will be right back. Its all the things that keep this world turning. Its the gotos that keep us going. The places we cheer. Trust. Hang out. And check in. They all choose the advanced Network Solutions and round the clock partnership from comcast business. Powering more businesses than anyone. Powering possibilities. In any business, you ride the line between numbers and people. Whats right for the business and whats best for everyone who depends on it. Solving todays challenges while creating future opportunities. It takes balance. Cla cpas, consultants, and wealth advisors. Well get you there. Do i think rates can go up a little bit yes, i do. If they do and is the world prepared for it . Not really the worst outcome for all of us stagflation. Higher rates, recession. That means corporate profits go down and well get through all that the world will survive that, but i just think odds are higher more than people think. Of course, Jpmorgan Chase Ceo Jamie Dimon speaking to colleagues at cnbc asia yesterday. Joining us for more on the markets and a. I. Related business is a bubble investors rob arnott, firm with 147 billion dollars in assets under management and a subadvisor to some pimco funds rob, good to see you. Wonderful to see you. Jamie has been on this line for quite a while. Just looking at potential Macro Economic risk. Meanwhile, markets seem like theyre positioned for a pretty benign economic outcome rising earnings maybe a soft economic landing, inflation on the down swing. Where do you come in on all that what youve described is the narrative that sets where markets are now. The markets are priced based on narratives the narrative is a benign outcome. But i think its wonderful when you look for asymmetries where the Market Outlook breakeven inflation rate is 2. 3 for the coming decade. That means, gosh, should be an equal likelihood of 1. 3 or 3. 3. Ask 100 people, 95 say, no 3. 3 is more likely thats an asymmetry. Asymmetries create opportunities. The market is priced for a benign economic environment. And i think jamie put it really well in saying it could happen, but he doesnt use the words asymmetric risk but its clear thats what hes talking about right now you have pmi in its worst quartile inventories worst quartile you have rate of change of the cost of capital over the last three years in its worst quartile indications of a recession or slow down. Our work calls for 75 slowdown. 25 chance of exceeding past growth rates now, thats an asymmetry so do you want to make bets that maybe inflation is more likely to surprise to the upside . Maybe the economys more likely to surprise to the downside . If you want to make those bets, that says go with value. That says, go with diversifiers. The frothy u. S. Market you made the comment, noted bear im a bull on markets that are cheap. Yeah. This market isnt cheap. How does value as a strategy in terms of exactly what comprises it mean its not as acceptable to those potential slowdowns we might get in the economy . How is it a little more insulated . Heres a fun factoid i think 99 of your audience doesnt know if you look at the russell 1000 value and you look at russell 1,000 growth, and you look at the growth in earnings of the value portfolio and of the growth portfolio, this century to date, nearly identical. Uhhuh. Now, how can that be . Its that way for two reasons. One, the gap in growth rates between the two isnt as wide as most people want to believe it is secondly, every time russell rebalances its indexes, some Value Company has come back into favor, no longer cheap replaced with a deep discount bargain, and all of a sudden the earnings and dividends of the index pop up with the rebalance. With growth, the opposite haps hap happens. A fallen angel, replaced with a new high flier every one takes a little hit and offsets the growth rate differences. So that decade to date, Growth Stocks have been excuse me. Century debate, Growth Stocks have been very disappointing. Sure. And excuse me, value stocks. Yes. Value companies have, in fact, done just fine. I guess you had a bit of a lost decade for growth as a strategy to start the century. You did. And brings us to animating forces of the market today recently, a. I. Boom and idea secular flow of earnings and seams growth that is, you know, maybe early and now getting capitalized by the stock market. Sure. How do we deal with that . Very, very simple i wrote a paper last year which, you know, its always its always interesting when you make a prognostication that is badly timed, and that works out badly for a little while anyone who cant acknowledge theirs is an idiot. But i wrote a paper last fall, a. I. Breakthrough or bubble . I said, yes and yes. Its a breakthrough. Its a huge breakthrough its going to change everything. We have a monthly allhands meeting at our company about a year ago i told folks in our company not one of you is at risk of losing your job to a. I youre at risk of losing your job to somebody who knows how to use a. I. Better than do you. Start learning, and its a tool. Its not going to supplant everything its a tool. And its a tool but nvidia is making a lot of money selling the tool. Nvidias making a lot of money. Quick word whether that is bubbly to you or based on Something Real seems bubbly. Price to sales ratio is astronomical because their price point is absolutely jie n ginormous. Oh keep your 50plus Profit Margins, keep your 90plus superchips dont worry about it no theyre all going to be playing. And the consequence will be wonderful for customers of a. I the power of a. I. Will go up the cost of a. I. Will go down, and nvidias current pricing is based on the notion that their market share and their Profit Margins are sustainable. Exactly what we heard earlier from one of the analysts 5. 5 of the s p. See how it goes. Rob, great to talk to you. Thank you. Thank you. Andrew . Mike, coming up after this, right here in paris, openai investors geoff lewis joining us around the chatmaker, and uproar over Scarlett Johansson, her soundalike. Plus, to ed is red knows day cnbc a big part of raising money for childhood poverty in the u. S. And throughout the world. The organizing raised 70 million in the past years since it started touching the lives of many to donate go to redknowsday. Org. Make a difference and win a prize in the childhood dreamstakes. Squawk box coming right back from paris and the nasdaq after this. Ames, it isnt. Car, where are we going . Were here. surprise the future isnt scary. Not investing in it is. Car, were you in on this . Nothing gets by you james. Nasdaq100 innovators. One etf. Before investing, carefully read and consider Fund Investment objectives, risks, charges, expenses and more in prospectus at invesco. Com traffic noises the road to opportunity. Is often the road overlooked. at enterprise mobility, we guide companies to unique solutions, from our team of mobility experts. Because we believe the more ways we all have to move forward. The further well all go. Energy fuels, a leading american uranium producer, is ramping up production to supply expanding Nuclear Markets and diversifying into rare earth elements, key ingredients in many clean energy and defense technologies. Energy fuels. Box. Futures shoering gains building strength throughout the morning. S p 500 indicated up twothirds of 1 . Dow by of 60 nasdaq big performer and pop in the stock up a couple hundred points 232. Right now we want to talk a. I. , and specifically some controversy surrounding chatgptmaker openai. One story that hit this week the Company Effectively disbanding an important safety team focused on the longterm risks of Artificial Intelligence. Another story weve heard this week, Actress Scarlett Johansson accusing openai of copying her voice for an a. I. Assistant named skye this morning, Washington Post report casting doubt on that a lot of back and forth. Joining us right now geoff lewis. Bed rourk founder and managing partner and an openai investor great to see you. Great to be here. Thanks for having me. Talking about when you got into a. I. . Back in 2021 about a year before chatgpt launched. Its been an interesting journey. The thinking when we initially invested was, really Cool Research project not clear it ever will be a company or figure how to general raitt , general rate revenue boy, has it changed. So much scrutiny. Still a privatelyowned company . I cant really think of a privately held company thats had this much scrutiny i think talking a little about uber, airbnb back in the day, but the societal implications with a. I. , aultimately in 10, 20 30 years get to openai the company the invited scrutiny and theyre getting it. I think this is scrutiny yew getting on a national level. Not just from the United States but from other countries, too, that want to take a look at this, because there are concerns about how powerful this is going to be. Potential for change especially if it winds up in the wrong hands, or just develops a mind of its own and does things we werent expecting or anticipating. Yeah. Look, i think theres a lot of regulation in western europe and stuff on the federal level in the United States, california has a bill thats trying to regulate, which im very strongly against the specifics of it. I think it would be really harmful to the ecosystem, but i think the point youre making around having a mind of its own and sort of operating as true Artificial Intelligence, a really exciting, like, thought extremely scary thought. Think of an agi. Gek decades away in terms of models and a. I. Agents that can do a lot of what some subset of human doss in the workplace, getting there very quickly. The a. I. That has human judgment and empathy and sort of operates as a human, thats scienceification its like elon getting to mars and getting that last 10 of the tech will take a long time. Elon might disagree how long it will take him to get there. Andrew may have a question, too. Andrew thanks, becky actually two questions one goes back to the ip question add asking for forgive in the, not permission move this in ways back to uber get to to escape velocity so popular sort of force the situation. Seeing youre seeing a deal now with news corp. This morning on openai, but there are real questions about what openai and some of these other platforms have trained on over theyears. Have they gone to so many of these Media Companies and other ip owners many years ago and said, we want to make a deal, unclear they could get that deal now, theyve done what theyve done, and theyre sort of forcing the issue. Of course, the new york times, which i have a relationship with, suing over this very issue. Yes well, certainly, going to be a lot of lawsuits to come, and thats sort of par for the course here. I definitely personally, as a human being, im a little hesitant about a. I. Models being trained off of my likeness, and i dont im not looking forward to the near future when theres all these deep fake videos of all of us everywhere that sound like us i can empathize with Scarlett Johansson on this. And yeah, i do think that it is just a were in a new world, and its it is quite scary, but this is where were at thats a longer debate. I also want to ask you about this as a venture capitalist i want to play you a little bit of sound and get your reaction to this, because yesterday, at viva tech, i spoke with anthropics ceo and asked him what he would invest in if he were a venture capitalist in a. I. , given that maybe there is going to be no defensive mode anymore. Heres what he had to say. Probably i would start a company or i would invest in a company that applies a. I. To, you know, some area of biology or health. And the idea is that, you know, i take the models, thats some new ingredient, and i try to understand them and combine them with other expertise that i have i think the same sorts of comments could be offered for areas like robotics, for areas like Energy Technology what i would not build is something thats a thin wrapper around the technology. I would think about what is the expertise that this other Company Brings to the table that theyre able to combine with a. I. Thats provided by Companies Like anthropic so, geoff, what do you think of that . And how worried are you that basically every investment, one way or the other, may ultimately get disrupted by this . There is this very real i generally agree. Im a little bit worried that his take is very conventional. You sort of hear every venture capitalist, everyone in Silicon Valley, trying to move away from wrappers everyones saying it, it might not be that accurate but i would urge anthropic to consider if he was a venture capitalist, he might want to consider investing in openai i would say, at this point, their model, their llm, which anthropic competes directly with, has definitively won in terms of closed source open source is another question. But no one ever says, im going to go claude it. Everyone on the streets now is talking about chatgpting it my advice to invest in openai. Do you invest in other Artificial Intelligence plays, or are you putting all your eggs in one basket with openai . Weve invested smaller checks, earlier stage, in other companies. Were pretty excited about the ecosystem thats starting to form, but i do think, at the foundational model level, they are the clear early winner at this point, and so weve gone pretty long there. Im so confused by the partnership, even competition, between openai and microsoft i mean, ive been talking to other players in the entire sphere around them who, sure, we start with openai, but openai cant scale up fast, and so if i need Something Else or Something Back up, i go to microsoft, and i use them for the openai needs, and i make sure that they are using azure to back everything up to go along the way whos the bigger beneficiary in this is microsoft ultimately going to be the big winner whos, you know, openai, to some extent, is selling microsoft cloud as a thirdparty service. That is accurate. Why not cut the middleman out at some point . I think the reality is just training these models from a reinforcement learning standpoint and getting that constant flywheel of data, you really need a tremendous amount of capital on the gpu side, tremendous infrastructure, which Microsoft Offers, and then the reinforcement learning that the integration with Microsoft Offers just gives openai a really strong mote is there a point where microsoft says, we dont need openai as much were going to be the one who sucks up all the power around this its possible my moneys on it might end up the other way around i know that its very early, but it might end up the other way around well see. Really . Thats going to be interesting to watch geoff, thank you so much for coming in. Great to see you in person, and we love having you here. Thanks for having me. See you soon andrew okay, thanks, becky coming up in just a moment, top stocks to watch as we make our way to the opening bell on wall street tonight, dont miss a cnbc special, the entire interview with french president Emmanuel Macron thats going to start at 8 00 p. M. Eastern time tonight stay tuned were coming back from paris and times square right here on squawk box in just a moment. ella fashion moves fast. Setting trends is our business. We need to scale with customer demand. In real time. jen so we partner with verizon. Their solution for us . A private 5g network. ella we now get more control of production, efficiencies, and greater agility. marquis with a custom private 5g network. Our customers get what they want, when they want it. jen now were even smarter and ready for whats next. vo achieve enterprise intelligence. Its your vision, its your verizon. Welcome back to squawk box. This morning, dom chu is back for another look at some key stock movers this morning. Dom . Andrew, headlinedriven, for sure heres a quick recap of some of the top stories of the market day, moving the stocks around. Were going to start with the stock of the day, the week, the month, the year, the maybe even the decade at this point. Thats nvidia. The worlds most valuable computer chip company and Artificial Intelligence darling reported an earnings superfecta. Profits and revenue and forecast all better than expected it announced a ten for one stock split and an increase to its still modest dividend payment. Nvidias on pace to hit a record high in trading. Next up, you got news corp. , which is a. I. Related. Shares are up big due in large part of the Parent Company of news platforms like the wall street journal and the new york post, among others, inking a deal with openai to allow its content to be used in the development of openais chatgpt generative a. I. Model. The wall street journal is reporting it could be worth north of 250 million over five years. In regulatory news, the Justice Department and a group of state attorneys general are slated to file an antitrust suit against livenation and seek a breakup of the company which owns the overwhelmingly popular ticketmaster platform. Thats according to multiple reports. Any hypothetical suit would follow a long trail of regulator and consumer scrutiny ever since livenation bought ticketmaster back in 2010 dom, thank you. Lets take a final check on the markets very quickly actually, its going to be up. Pay attention closely, especially with the nasdaq, thanks to nvidia that does it for us today. Join us back here tomorrow right now, its time for squawk on the street. See you later. Good thursday morning, welcome to squawk on the street, im Carl Quintanilla with jim cramer at post nine of the new york stock exchange. David faber is on assignment nvidias stellar quarter and guidance will push s p and nasdaq further into record territory today, all three indexes on track for their best month since november our road map is going to begin with the a. I. Boom nvidia with a record quarter and announcing that tenforone split. Jamie dimon says he cant rule out a hard landing for the United States