Transcripts For CNBC Squawk 20240703

Despite posting a beat on the top and bottom line. Tesla is on pace for a sixth straight day of losses, now issuing some recalls for the cybertruck over faulty accelerator pedals lets begin with Market Reaction to israels retaliatory strike on iran, jim. So far, not a lot of signals that this is going to cause a conflagration. No. I talked last night about what we need on mad money, a crescendo of selling at 10 15, we thought we had that last night the fact that we now have decided that it wasnt important not we decided that it is less relevant, so weve come back up is, again, something i dont want to see. We have to have people decide that negatives are negatives, not that an avoidance of a negative is a positive so, i want to hear more from Richard Engel about israel, but the fact is that we were down so much, and then we come in, and then were up . What are we up for why are we up . How about flat how about down a little . We dont get that. So, it makes me suspicious of this opening again, because people, by the end of the day, will say, well, maybe israel wasnt done. And i think its unfortunate its very hard to game whats going there. But i will say that the exuberance that we feel every morning based on, you know, flimsy evidence, it has well, the bulls would hope for something that blinken talked about this morning, and that is this journal piece that the white house is still actively working toward getting a deal with israel where they talk about some Palestinian Statehood in return for diplomatic recognition from riyadh i think you have netanyahu, whos more of a wild card than ever, and again, i dont want to im not a political expert i follow this one pretty intensely, but i come back and i say, when it comes to stocks, you dont you have proposals throughout this period, and netanyahu has not gone with them so, i mean, netanyahus been trying to prove his independence i think he needs history i think he needs back in his days when he was in philadelphia 1973, hes got to go over those five days where kissinger convinced nixon to resupply, and then he will understand where the hell we are, and i think its very unfortunate that he doesnt seem to know history as well as i thought, where israel needed everything, nixon was against it, kissinger said, you have to do it, its a democracy, and the United States saved israel and anyone who disagrees with that just doesnt understand the golan heights. So, im not saying that hes ahistorical. I am saying that he seems to be ignorant of what happened in 1973, and its going to cost israel, historically to you, is it mostly about energy goldman today, again, we see brent in a range between 75 and 90. Brainard saying, were going to make sure gas prices dont get out of control this summer i love the idea that we can control it, but i think that goldman put out a good note for alumni which is that markets may be worrying too much about overheating. This is david marigold this is the first piece ive read which says, enough with the hysteria about inflation the fact is, there is what he calls catchup inflation, which is about Car Insurance and owners equivalent rent im going to see a car dealer, going to carvana theyre intraquarter, but you said, yesterday, something really good. You said carmax is disappointing. Disappointing because prices are coming down. Ive met with them theyre probably the best operator, and theyre the only one that actually uses a. I. , so they actually had a sense of what could happen. And look, insurance is something that we all feel its funny we have Jonathan Kanter at justice really pressuring apple, and the issue with apple, again, is that the phones are so good that people dont switch well, how about the fact that if you switched insurance, all it would do is make it worse . But you know, theyre not theyre not savvy like that, because theyre antimega tech, and the Justice Department is emerging as the one im now focused on the other agency, we know their stance they seem to be fine theyre consistent the ftc which one do you mean . Theyre consistent. But kanter has taken on google, and hes taken on apple. Hes got Merrick Garland on his side, the attorney general, but when i look at what happened with apple, what happens with apple is it has to cut numbers well get that number cut. Then, two to three days later, well say its bottomed. Then, the focus will be on the other mega countries besides china. Youre going to start hearing a narrative which says, we got to start thinking about brazil, philippines, indonesia, turkey, and then we have to extrapolate india. But they havent been able to tell that story yet. You mean as a supply chain . No. Customer base three years from now. Oh, interesting and if they were to focus on longterm value of those new customers, particularly in india, younger customers, not unlike what i talk about when we talk about American Express, what people realize is, for the first time and i will even go as far as to say that procter is doing the same thing for the first time, were not as levered to china as we think, and i think wall street is way, way behind the demographic changes that were seeing. Where did tim you know, tim puts tim cook he puts factories where he wants customers. This man spent more time in jakarta than weve seen. Now, you could say, wait a second, he capitulated on whatsapp i would say that he makes deals. Hes always been pragmatic, but the pragmatic nature of indonesia, a country of more than 200 Million People, growing like crazy, to me shows you know, vietnam, 100 Million People youre talking about not just diversifying chinas locus as a supply chain hub but as a customer hub on the demand side our country is addicted to thinking that china is a winner in everything. Our inferiority complex to china is only second to the inferiority complex that chinese feel about china, particularly after covid, where they were given the opportunity to have a vaccine, and they chose not to have it. Pfizers had the worst quarters ever, but man, they make a dynamite vaccine well, procter today, john mueller on squawk had relatively positive things to say about china quarter on quarter. Yes and you know what . I got to tell you. I see procter down three you could say im talking for the home team because my travel trust has owned this stock forever. You can send this stock down its not a problem you can focus on beauty. You can focus on children. But what i think you really should focus on is one key thing. When you look at the Third Quarter last year and the Fourth Quarter last year, you had the dollar overwhelming the cost savings. That has been the dynamic that weve suffered, and what happened this time the cost savings exceeded how much is lost on the dollar people dont want to look at that what do they want to look at they look at the headline generated by a. I. , which says the revenues werent that good its really unbelievable that you can get out of argentina, genius, get out of countries where youre selling things for much less than you make it, and then you get punished, down four ill take the other side of that trade. When its down four, you got sellers that come in and sell it down to 153, and then you got to buy it hand over fist organic, up three was a slight miss. Heres what mueller said about china earlier this morning take a listen. China is down a bit, as the market continues to struggle, but even there, were seeing sequential improvement, quarter to quarter well, this is a sequential improvement story. Its not an absolute story its a relative story. You know what . You got to do a you got to parse the q3 and q4 to recognize the improvement, but the lack of history of how procter did on q3 and q4 is sending the stock down people must go over the line by line i went over q3 and q4 coming into today, and i was pleasantly surprised. Its sk2 that is this problem. Yes, yes. Theyre not going to this im calling it the were going to get the gen z and millennials when we talk about American Express, but the gen a. I. On procter sends it down. Gen a. I. , theyre not looking q3 and q4, the machines, and so you have this stock getting clobbered, and i understand. You want to sell at the opening. Look, the Hedge Fund Guys who are super novas, theyll take that youll buy it at 153, theyll sell it down to 152 thats what theyll do and then, theyll cover. And the individual at home is saying, something must really be wrong at proker, and im telling you somethings really right at procter, which is that their costs are down, and they didnt have to cut prices go listen to the conagra call, the kellogg call you can listen to General Mills. If you didnt have to cut price, and your prices fell h hormel your stock went up procter is no different. Im not going to disagree with the opening, because im never going to disagree with the guys who are just banging it down i want to own that thing at 10 of 10. Well watch it after the open nice 7 div hike 11 of 10, no. Meantime, lets do get more on the israeliran conflict. Nbcs chief foreign correspondent, Richard Engel, is on the ground in jerusalem this morning. Richard, the reports here sound like this was carefully calibrated do you agree it was a very limited strike, and if you look around, the streets of israel, you would hardly know that anything happened there have been no instructions given to the public for people to take shelter. Traffic is flowing as normal people are out people are shopping. The airport is open. Air space, uninterrupted and thats a pretty strong indication that israel doesnt expect an immediate counterstrike and tried to calibrate its response and whats interesting is iran is also downplaying this weve been talking over the last couple days how iran has been making threats, was threatening fire and brimstone, that if Israel Attacked, it would immediately respond with a ferocious attack of its own, but instead, what is what iran is saying is that since this attack on an air base was so small, that its a sign that israel was intimidated, that israel was too afraid to do more, and therefore, painting it as a success for iran so, if both sides can walk away feeling that this was a victory, that is a best case scenario, because that is how you deescalate all conflicts around the world. You give each side an offramp this is not over but things are looking like we are heading potentially toward a deescalation of this part of the conflict, of the direct iran versus israel, headtohead, we attack your country, and well respond by attacking the other directly okay, richard, first, jim cramer i want to salute you for unbelievably neutral reporting and unbelievably situation, once again, where your life is in jeopardy its unbelievable how good you are. I want to talk about targets thank you no problem. You dont get it enough. Why not just tell you . Targets. Why that target in iran . Whos there . Whats there and is that not in itself a sign that theyre not going after obviously, really Populated Areas that could have caused a terrible, terrible tragedy of life so, this was a military base. Isfahan is in central iran, a his historic city, one of the most beautiful cities in the world, really, certainly the most beautiful in iran. Theres an expression in the country that means, isfahan is half the world and contains half the worlds beauty. Its a wonderful place but it also has a military industrial component the uranium enrichment site is there. That was not attacked. It was not touched in fact, iranian tv put out pictures today showing the main circle in isfahan with traffic flowing as normal. Iranian state Television Anchors were telling people that things were that they should live their life as normal, one saying that the israeli strike was no big deal they showed life continuing in that country so, it seems that israel chose that because theres also a missile Production Facility there that produces mediumrange missiles when iran attacked this country, it used Ballistic Missiles that fired they were almost all shot down, but that they were fired here it seems like Israel Attacked a missile production area in order to send a message to iran, a, that it can get through its air defenses, and b, you target us, well target your military facilities by the way, irans main target in israel was also a military base richard, streets listening closely to you this morning. Thanks for that. Hopefully later this morning or today and the days to come, we can talk about longer term diplomatic pushes. Thats Richard Engel in jerusalem. Dont you love journalism what journalism was. Still to come, details on netflix. Bunch of calls today well get to axp and schlumberger new projects means new project managers. You need to hire. I need indeed. Indeed you do. When you sponsor a job, you immediately get your shortlist of quality candidates, whose resumes on indeed match your job criteria. Visit indeed. Com hire and get started today. I dont want you to move. Whose resumes on indeed match your job criteria. Im gonna miss you so much. You realize well have internet waiting for us at the new place, right . Oh, we know. We just like making a scene. Transferring your services has never been easier. Get connected on the day of your move with the xfinity app. Can i sleep over at your new place . Can katie sleep over tonight . Sure, honey this generation is so dramatic move with xfinity. After military service, you bring a lot back to civilian life. Leadership skills. Technical ability. And a drive to serve in new ways. Syracuse universitys Daniello Institute for veterans and military families has empowered more than 200,000 veterans to serve their communities and their careers. From professional certifications, to job training, to help navigating programs and services, we give veterans access to support from anywhere in the world. Netflix is the biggest premarket laggard after issuing softer revenue guidance than the street expected. That news, overshadowing a quarterly beat, including 9. 3 million additional subs. The Company Announced plans to stop providing sub numbers beginning next year. This is coceo greg peters on the call each incremental member has a different business impact, and all that means that that historical simple math we did, number of members times the monthly price, is increasincreasingly less accurate in capturing the state of the business. This change is motivated by wanting to focus on what we think are the key metrics that matter most to the business. Best start to a year in terms of subs since 2020 it gets tiresome. My travel trust does not own netflix. Amazing quarter. And again, i keep using this word, parse, because we seem to be ahistorical this was a great quarter i dont care im going to give them the benefit of the doubt about their decision about the way theyre going to give information. The essence of this story this time was a verb that they used that ive never really used it myself you can google it. Eventized. Theyre eventizing their business there was a jason was asked pointblank about the tyson fight, and whether it would be good, and he said, yes i think that these people are creative i think that they keep growing everywhere i think that when you have people, just read the darn release. Society of the snow. This is a movie, 98. 5 million views. What does this mean . Throughout the quarter, throughout the discussion, its about how films breed viewers. Who else talks about that . So, you may think that their projections, their forecast is down beat, and they did. Some people said, listen, i want to be a bad guy. Im not going to just dismiss the body of work that these guys have done and how many more people they can still take and Everyone Wants to find fault Everyone Wants to find fault with a stock thats down 45 thats like the people who said that were going to have six cuts hey, theres the sixcut crowd right down there down 42 means down 46. This is another 10 of 10 story nobody gives these guys the benefit of the doubt this has been one of the greatest stories in history. I think i mean, the downgrade today says the stock is up 90 in 12 months good. The good stocks go up. Let it come in im in no hurry. The stock was up huge, people were asking about what to do with it yesterday. What have they done . Theyve accomplished the almost impossible they have an ad tier, and they dont even have all the money thats going to be made. Ad membership, up 65. Still gunning. The 10 penetration is all they have versus what they could have the number of countries that are involved look, its an International Success story, and all anyone wants to do is call a top. That has been the prevailing call top, call top, call top why dont they actually read beyond the second paragraph of the of that bizarre youtube stuff . Let me tell you why you know how to get that stock up they wont do it go do what jack hartung, the finest cfo in the land, did. He said, we got to split the stock. We got people who want to be in the stock. If they were to announce a split, you know what would happen they would be up 43. Thats how pathetic these opening quotes are the other media piece to fold in here is from time. Does sony have the money . It would alleviate some financing concerns i want the Champions League you can have the rest sold to you. Can we just go i mean, honestly, netflix the sellers are using chatgpt. Right . I mean, thats what it has to be you put it through chatgpt, he talks about weakness if you actually read it, it talks about strength you think selling is a hallucination today . Yeah, i think in the end, there are survivors in uruguay uruguay. There it is. Okay you got a uruguayan movie. Uruguay. I didnt know they made movies i thought uruguay was, like, you have a good bank down there. What the heck . And amortize that all around the world. Thats my point you know what . I like prell and i like society of snow. Pretty busy friday shaping up in the futures, as you know, have recovered a lot of lost grnd ckn mont business. Its not a ninetofive proposition. Its all day and into the night. 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. The all new godaddy airo helps you get your Business Online in minutes with the power of ai. With a perfect name, a great logo, and a beautiful website. Just start with a domain, a few clicks, and youre in business. Make now the future at godaddy. Com airo at pgim, finding opportunity in fixed income today, helps secure tomorrow. Our timetested fixed income suite, backed by over 145 years of risk experience, helps investors meet their goals. Pgim investments. Shaping tomorrow today. Take a look at some premarket gainers. We talked about paramount before the break. That is going to lead you this morning, up about 10 on this heels of this times story. Isrg is in there too Regional Bank action as well well talk fifth third and huntington and axp when gweet the opening bell in about four minutes. Announcer the opening bell is brought to you by nuveen, a leader in income, alternatives, and responsible investing. Lets get a final mad dash for the week, jim. Sometimes you have to go a little deeper than just looking at the earning per share j j won a very big case last night in the talc issue. Remember, the plaintiffs are alleging that j j knew that there was asbestos, which causes cancer, in talc. That view, by a firm called beasley allen, they have not won a single case. This is and by the way, just so you know, j js been winning these cases, and theyre doing a parallel effort to be able to settle everything. Whats important here is that there really still is no evidence that theres a linkage, even though the plaintiffs constantly say it. Were going to see abbott labs report at the bell abbott labs stock was going higher, and then it was mentioned that a competitor lost a formula suit because there was a terrible tragedy with a baby im saying that maybe the plaintiffs have reached a bridge too far against corporate america, and maybe the Supreme Court one day will agree with that well, walk was on squawk and said theyre going to look at foreign financing of the plaintiffs its time j js leading a very informed, sophisticated tactics of the plaintiffs there is a Plaintiff Firm that is very good, and i dont want to i dont want to dismiss them theyre very good. Jim mentioned abbott. They are at the big board today, along with buffalo bill safety, and heart mates ambassador damar hamlin doing the honors. Fantastic hero everyone remembers that moment, that heartstopping moment on the field, and everyone now remembers. There he is. Great to see him at the nasdaq golden matrix, a gaming company. Bunch of headlines about marketing spend and chargeoffs and some weakness, they say, at small and mediumsize business i know. And by the way, steve scurrier would admit that if you want to take a longterm view, what matters there is the incredible funnel they have. They dont have to pay as much the acquisition costs are very low, because they advertise on credit karma they advertise where they have to be. American express has been ridiculed and if you go back to youre showing your age if you go back two quarters ago, there was a belief that in october, steve said that, look, spending was a little bit lower on restaurants the stock dropped to 160. And then its been a straight shot, why . Because the quarter and the quarters were really good. This was a very good quarter, because once again, hes getting millennials, gen z youre talking about a lifetime value of a card. Thats what youre trying to go for. On your card, what year does it say when you joined 1981. Im 90 well, i remember getting it, and my folks thought that was the sign that i had finally gotten oh, cf frost. No longer living out of my car and making a couple bucks. Look, steve squeri is a remarkable operator and a regular guy. Unfortunately, a jet fan people do that and i think that this was just another quarter in line with many good quarters yes, restaurant, not up as much as i want, but all of the every trend is good, and by the way, his losses, thats what im focused on his losses are much lower than, say, discover. Much, much lower he did say that discover, capital one, theyve got a lot of work to do. Es, they do chargeoffs, still, a shade below prepandemic still i would point out this is a man who has reinvented this company and has taken it to being the mind share of the people who are in their 20s, who are who you really need. Its incredible, because as he had said he walked me through this once. He said, jim, in their 20s, they get the car, in their 30s, they start using the card, and in their 40s, they take the points and do what my life does shes got that stack they dont go to me. Its incredible. Oh, yes the bill goes to me, but those little all the rewards thats exactly how that works. I got to look into that the other trend regarding fifth third and huntington is basically provisions in line, Guidance Unchanged thats the running theme this morning. I know, and you want the Net Interest Income to be good, and i actually dont want the Net Interest Income to be good i want the business to be good, and thats why i continue to like what Charlie Scharf did at wells fargo, where he has reinvented the company and made it a feebased business so hes off the treadmill, and the treadmill fifth third had very good Net Interest Income. Were going to get off the treadmill as part of a normalization of the economy, and when we do, you Want Companies that are doing a lot of business. Thats the new wells in wells, by the way by the way, you know, the informatica crm stuff they once told me, we have the software to detect the fraud that they were doing at wells fargo. Well, i got to tell you, Charlie Scharf has been paying the price of that fraud, but its almost over, and who knows how well he can do if its really a bank and not a fee machine. Hes going to the fees are going to accrue soon to the shareholders, not the law firms. Youve been saying, watch the fees, not the Interest Income. We have to go back to remembering what makes a bank stock go up. Its a business of fees, all right . Now, jamie dimon turned it into a referendum on the world. Now, jamie is just too existential. I got to get to him. Hes become too existential. When you did philly when was philly, your interview in philly with jamie . A year ago going to 6 interview it was a while ago two years ago . I dont know it was at the opening of a he still thinks like a banker i love jamie he used to think i hated him never true so did charlie he said, why do you hate me . I dont hate these guys. Dimons got to start thinking, listen, let me talk about how well the bank is doing, not let me tell you about the world. When you interview anyone about the world, they have a similar conclusion i dont need his view of the world. I mean, its pretty much like everybody elses right jim, in autos, theres a lot to get to theres this the end of this vw uaw vote. Well see what that means for the union. Shawn fain on the time 100 list, as you saw, im sure maybe ill sit with him the tesla recall. The tesla recall. Look, all it is, its acceleration, which could cause a horrible crash and unlike some other this is as regards the accelerator. The pedal stays down. Its still bulletproof so, its a ram and run car i appreciate that. Boy, you know, jonas, i gave him a call he doesnt take my call. I love that. But the work hes doing now about where these stocks are, the bottom ten in the s p, exfinancial, of course, and youre seeing gm and ford. Ford should be buying back every share, for heavens sake gm viatra its a suboptimal company, but gm is the cheapest stock by pe mary barra is doing great. Mary barra, their trucks, the accelerator comes when you take your foot off it, it doesnt keep going thats a plus thats positive then you got the good torque we are going to get tesla on tuesday. Jonas did say yesterday, situation could may well deteriorate further is the company exiting the traditional ev business . At the margin, it seems so yeah, it is you know, its very hard to criticize a genius you know i dont want to be the guy who says, you know what that, mozart, forget about him you got a guy who is a genius. When you speak to his competitors, heres what they say. He can pull a rabbit out of a hat. You never know i dont know what the rabbit is. Yes i dont id like to know what the rabbit is i had rabbit on wednesday night. Really . Yeah. I took that over the pigeon. What a hobsons choice, you know well see what happens, what we get on tuesday. Lot of news in chips raimondo is going to be on 60 minutes sunday, a nice profile of how shes made commerce a pretty powerful agency out of nowhere. I remember when commerce was a place that issued a lot of things, and you got really, really terrific dinners. Now its the locus, they say, of National Security, job creation, manufacturing, and then, jim, nvidias on the cover of barons this weekend and its a piece about competition coming, look out, here comes amd. They won the first round of a. I. Well see what happens now look, here comes amd. Look, lisa su would tell you l lisa su, congratulations on winning an award from the Franklin Institute last night in philadelphia lisa su would tell you that her chips do not offer the software. Theyre just hardware. By the way, intel is 100 hardware but thats what matters, and when you speak to nvidia or go to the conference, you realize that the giant leap that nvidia has over everybody else. But you know, with blackwell, its going to be unbelievable. The long nooknives are out for nvidia ever since gtc. Remember what nvidia did between july and december of last year it did nothing i remember being ridiculed i bumped into someone this weekend, again, when i was in antigua, saying, thanks for jamming me in that nvidia. Well, sorry. Sorry about that jamup. Jamup, mate i mated that guy you mated that guy. I gave him a mate. I gave him a check mate. He mated me, i checkmated him. Theres some weakness in semis and tech tsm is crushing it. The fact that i mean, when you talk i say own nvidia, dont trade it, but im not saying, buy it right here. Let it come in same thing with apple. My price target of apple is 160 thats where i think people just say, ive had it sometimes you have to psychologically think where people have had it maybe people have had it when it gets nvidia gets to 790. I hate this opening, carl. I hate it. I just hate it yeah. Yeah i just hate it. Circling around 5,000 here. And whats the thesis to buy today . Because the missiles didnt hit x . I mean, i need thesis. I like procter i like netflix i like discounts i like discounts i dont like premium and people may hate the semis, but one day, theyre going to realize that those are the guys that have the good quarters. By the way, taiwan semi, it killed itself. The stock was up instantly, two, three points, but then they said pcs are weak if you go to hp, theyll tell you the pc refresh cycle the going to be great because youre going to get a button thats an a. I. Button. Im not itching to buy a new pc, even though my tc now, if i press down the letter t, i get three ts i will wait because i want the a. I. Button from microsoft their commentary was confusing because they cut guide on industry, but kept their own growth pretty much intact. Funny, huh . Communication. Look, asmlf was a disappointment Gina Raimondo is so good, and taiwan semis really the one thats embracing and micron i cant get bearish on chips ahead of the biggest refresh cycle in pc history. I cant get bearish on chips when i listen to michael dell talk about whats going to happen in the future but i understand people dont know what they own my father lost all of our money on a Company Called National Video because they had the best picture tubes for tv solid state. Nvidia is not National Video its a real company that is that has a giant, giant refresh that is so amazing that its going to make it so intel and amd are left in the dust people look at the stock and foment reasons why its been going down thats been the way since we bottomed in october. Its like, oh, that stock is down let me give you a thesis of why its down. Ill give you a thesis of why Procter Gamble is down people are selling it. But they have not bothered to do the work and its very frustrating. I know thats against the grain to buy procter, but i need you to think about a dividend aristocrat that is going to have that finally outran with costs that went down and prices that didnt right thats what were looking for. Costs go down, price didnt. Thats General Mills just look at the trajectory of General Mills. That has been the stock. Hey, by the way, the only reason to worry about procter is because paul paulmans plans to reinvent unilever, killed. Plan killed. New rules. The new rules are, hey, listen, what were going to do is whats right for the shareholder, and were not going to be doing whats right, necessarily, for the planet back with a little more plastic, no longer hiring disabled like they were. They were committed to a path under paul pullman that did cause underperformance, and now, theyre scrapping that plan, and thats the only reason why you would be negative on procter, because that is the principle. Not every company has costs falling. The downgrade of hersheys today. Record cocoa cocoa is parabolic. I think that cocoa has a history. Cocoa, what, 20 years ago, had one of these moves, and then it crashed. Thats one of the reasons why no one is biting on the big decline in hersheys if it was really bad, the stock would be at 150 i dont want to own hersheys, because i dont like that particular portion of the formula, because i think of the packaged goods, because i still worry about the lilly impact, glp. If you cant get any zepbound, what happens when you can . Meanwhile, ulta, jeffries cuts to hold no surprise, increasing competition from sephora look, sephora is better what am i going to say i love kimble. By the way, there is no slowdown i had e. L. F. On. Theres an acceleration. The problem is kimble has to recognize that they have not only is that kohls has a ceo who, if anyone sits down with him, and thank you, matthew boss, for setting up a dinner with me, tom kingsbury, he will sit there and figure out what it means to kill the competitors, and he will do it. I went to a revised burlington after he took it over, and it was like they it was like buy one, get seven pretty good. Well watch ulta. Djt is interesting couple of severe bounces the last couple days as were back to 35. Of course, look like we have the jury set in the criminal trial were looking maybe for Opening Statements on monday is that a referendum on pennsylvania and michigan, wisconsin, nevada, arizona i mean, i always feel like this is those are the ones you need hundreds hundreds of millions, and you haveto figur that pretty soon, with a captive board, trump will be able to cash out so, if you wanted to give to that campaign, and im certain not urging anyone to give to any campaign, it would be better to give to djt than it would be able to give directly to the party, because thats what can be cashed out. If once they get the once trump is able to convince the board that they should let him out of the lockup because the stock is so high in that similar vein, in media, you mentioned, briefly, jim, this journal story that the chinese have asked apple told apple to remove threads and whatsapp from the app store in china. Latest censorship demand well, tim cook is nothing but pragmatic, and thats a pragmatic decision i think that it hurts you could argue it hurts whatsapp, meta, more, because it shows you that the power of the government against whatsapp, but i think whatsapp is not even included in the valuation of meta apple could come out and say, business is better, and people would sell it down three this is one of those situations where, until the cfo says we are were getting clobbered in xyz, people will keep selling it right zuckerberg did unveil this chat bot, which is intended to challenge chatgpt and bing and gemini and talked about a. I. Investments. Take a listen to zuck. Were investing massively to build the leading a. I. , and open sourcing our models responsibly is an important part of our approach the Tech Industry has shown, over and over, that open source leads to better, safer, and more secure products, faster innovation, and a healthier market and beyond improving meta products, these models have the potential to help unlock progress in fields like science, health care, and more. You probably start toying with it once it comes out. Hes one of nvidias largest clients. He said, ahead to the time 100, which is now becoming a referential he said incredibly positive words about jensen if i were a customer of jensen, i would do that too, since you cant get all the lot of people dont understand that you have to develop your own chip because jensen cant make the chips fast enough. I think people say he bought 300,000 of the current iteration. He will take anything. This guy would actually buy the whole i think hed buy the whole line, everything that comes out Assembly Line of nvidia one of the reasons why i swear to nvidia is because i Like Companies that cant meet demand and by the way, the Housing Companies cant meet demand. One of the reasons they cant meet demand is you get a firm like kbh, they commit to a higher dividend. You know what theyre not doing . Building homes they realized their stock is a better investment. Doug yearley started that at toll brothers, where he said, im just going to buy my stock, because its the cheapest way to buy the that much better than putting up spec homes. Thats one of the Home Builders could go up in a hype cycle. Really confounding jay powell, who didnt see that coming goolsbee would argue it is the high rate that is infla inflationary itself. Goolsbee is a very practical man. Thats totally true. I think he looks at what the home bimuilders are doing, which is to say, im not going to build homes, im going to buy stock. First time ever. Little bounce at the open dow is up almost the 2 hundred check bonds as well. I think goolsbee will be speaking today, but thats pretty much it in terms of fed speak and data thank heavens maybe theyre doing that stuff where they dont work fridays. The fed is moving to a fourday week. Great stuff with a uruguay movie. Tenyear, 4. 6 . 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 we all go. Encore energy, americas clean energy company, now in production in south texas. Energizing america with reliable and affordable uranium for Nuclear Energy fuel from our environmentally friendly extraction process. Encore energy. Netflix remains a story today. We did get the downgrade the interesting upgrade out of needham where laura martin who had a hold for two years as the stock doubled finally goes to buy with a target of 700 talking about how gen ai will benefit this name in particular. Right now down about 8 as they bsn ithhold that data on the su ithe coming year. Well get stop trading with jim in a minute. T patient informati. But what if they didnt . [ominous background sounds] this is what it feels like when cyber criminals breach your network. Dont risk the health of your business. Crowdstrike. We stop breaches. When you own a Small Business every second counts. 120 seconds to add the finishing touches. 900 seconds to arrange the displays. If youre short on time for marketing constant contacts powerful tools can help. You can automate email and sms messages so customers get the right message at the right time. Save Time Marketing with constant contact. Because all it takes is 30 seconds to make someones day. Get started today at constantcontact. Com. Helping themy namestand tall. Is teresa barber. I was in the United States navy and i served overseas in the middle east and africa. Early on in my career i had a commander that taught our Suicide Prevention training on a friday afternoon and the very next day, he took his own life. 90 percent of suicide attempts involving a gun are fatal. You dont know how much somebody can hide whats going on in their head. Store your guns securely. Help stop suicide. Lets get to jim and stop trading. A stock that keeps going down that should be going up sob, the schlumberger, down 4 for the year reported another good quarter, talking about actually i would say theyre talking about being ju by lent, excited, what i usually dont hear, having an exciting start to the year and i think they are and thats a stock if you want to be able to buy an oil company other than conoco, chevron or coterra, look at slb. The names well get beginning monday, verizon, tuesday tesla, texan, meta wednesday, ibm, now. Thursday the barn burner with microsoft and google. Lets take those. Now microsoft and google are going to be good i think google will be good. The beginning of the week might be soft but they can handle it verizon is going to deliver a good number, second time in a row, hans has figured it out good for him. Well be busy. Nordstrom. Yeah. I was going to say the take privates nordstrom rejects initial takeover from the nordstrom family, 50 a share in march 95 of 2018. Thats a gang that cant shoot straight im sorry. We are beginning to make a list after endeavor, 23 and me in the mix now. Yeah. I mean, theyre going all health this is a horrible article in the journal about them. How about tonight i have one of my most exciting companies, a company i bought a car from, carvana i bought it. I didnt like it i returned it. I mean it was easier than returning something to marshals, which makes it easy. Easy as turning them to sears, remember that, you could take it back you owned for ten years and then john holmes, a company that does aerospace anything we can find out about aerospace is important including the black hole that is boeing. Tough week on the hill after that yeah. I think about the b29. Oh, my god it was all bad, all zeros. One day the b29, and everybody clapped and maybe well win the war. Go back to that period. Good show well see you tonight. It matters. Third quarter of proctor, 1973 or 1943. Mad money at 6 00 p. M. Eastern tonight. When we come back, whartons Jeremy Siegel, his take on this market environment in a minute good friday morning. Welcome to another hour of squawk on the street. Im sara eisen with Carl Quintanilla. Live from post nine as always of the new york stock exchange. David has the morning off. Take a look at stocks this morning. Were starting on a high note up 155 on the dow at least. The s p lower. Its been bouncing around between gains and losses all morning long and only a half hour of trading but all over the place. The nasdaq down 0. 4 adding to its losses treasuries the story has been higher yields and bonds selling off. A bid this morning with the 10year still firmly above 4. 6 , the 2year below 5 . 30 minutes into the trading session here are movers were watching shares of netflix dropping the streaming giant beating earnings estimates but gave lower than expected revenue guidance and said it will stop reporting a key metric much more on that stock and what to do next later on in the show. Shares of paramount surging on reports of a potential sony apollo joint bid for the media giant. No arm formeral offer made paramount in the talks with skydance tesla on pace for a sixth straight down day now down 40 this year and trading at new 52week lows, recalling almost 4,000 cybertrucks due to a faulty accelerator pedal that can cause the vehicle to speed up well talk about tesla with these losses piling up. Israel the story of the morning retaliating against irans drone and missile attack on its territory almost a week ago. Back to Richard Engel for the latest in jerusalem. Hi, richard. Reporter good to be with you again. So israel retaliated this has been a series of retaliations over the last couple of weeks. First at the beginning of the month on april 1st, iran carried out an attack, israel carried out an attack on the Iranian Embassy in syria last weekend, we saw that attack unprecedented attack by iran against israel and israel responded. But in a very limited way and the key thing is, it seems like both sides now are trying to deescalate, trying to pull back from the brink and the reason that it seems obvious is, here in israel just a few hours after this military strike, on a military base inside iran, just outside the city of isfahan life is proceeding here as normal. The military has not issued any guidance for people to avoid gatherings, to go to bomb shelters, to for updated advisories instead, people are operating as they would any other day the airport is open, the air space is open, and in iran, significantly, iran had been saying from the president on down if israel did anything it will respond ferociously and immediately. Iranian state media are downplaying it and brushing it off presenting it as a win saying the only reason that israel carried out such a limited strike, and it does appear to have been limited in scale, that it is because iran be intimidated israel so much with its last strike the past weekend. We seem to be a phase where both sides are trying to step back. Both sides are able to claim a bit of victory and that is a potentially positive sign in the region and leaders im speaking to, including senior officials in governments around israel, are watching with a degree of cautious optimism, perhaps we are pulling back from the brink of a regional war, a brink of a direct military conflict between iran and israel. Are there implications for what israel has to do in gaza . Reporter i think there are we are still awaiting an offensive against the city of rafah and surrounding area and there are many palestinians who are congregating in rafah, over a million palestinians are taking shelter there, pushed down from the north, pushed down from central gaza, and we dont know exactly when the rafah operation is going to take place. Israel said it will go into rafah. It claims that the hamas militants are hiding among the people who are congregating in that part of the Southern Gaza strip. It could be that israel is dialing back from its confrontation with iran in preparation of assault on rafah. We really dont know in terms of timing for the rafah operation, clearly that is a closely guarded military secret but it doesnt seem like its coming in the next few days. Many israeli troops have been rotated out of the gaza strip were almost at the start of the passover holiday and israel will have to send troops some troops on leave, israel will have to send other troops back into the gaza strip in preparation for rafah. The United States has been opposed to a fullscale invasion of the rafah area, so that operation still seems like it is coming, but it might be a few weeks out. To come back to your question, they do seem related because it would be difficult for israel to carry out what will be a controversial and major operation against rafah if it does go ahead while simultaneously conducting a fullscale war with iran, so close one portfolio, put that on ice for the time being, while that other one looks like it is pending. Finally, richard, the journal piece last night says that white house still has its eye on a longshot deal in which israel would commit to Palestinian Statehood in return for recognition out of the saudis are people talking about that anywhere being in the realm of the possible reporter not really. Here the idea of a twostate solution seems very far off. When you talk to palestinians that say they will tell you that is the only solution, given the palestinians a state, given the let the israelis have a state within their border and the two sides can hopefully exist side by side, but that is not the mood right now that is not the policy of Prime Minister netanyahus government. Hes formed a government with some members of the extreme right who are diametrically opposed to a twostate solution. He himself is opposed to a twostate solution after the massacre carried out by hamas on october 7th, many israelis will say they dont have confidence in living next to a palestinian state they believe that if there were to be a palestinian state, they would immediately have an enemy on their border. So i think its a conversation that the region is having, that palestinians are having, but not many israelis are having at least in public. Yeah. Westerners are having. Thank you very much, Richard Engel. Great to hear interest you with the updates from jerusalem in the meantime looking at the overall market, tough week, carl, for stocks part of that has been the back up in bond yields. We did a best of commentary from all the fed speakers that we had this week because there was a lot, and a lot for the market to tee off of, and they pretty much all said the same thing. The hawks and the doves, which is, were not there yet. Heres Raphael Bostic atlanta fed president , for me thats okay, im not in a mad dash hurry to get there talking, obviously, about rate cuts new york fed president john williams, i definitely dont feel urgency to cut rates. Cleveland president , at some point we will get more confidence, we will start to normalize policy back to a less restrictive stance, but we dont have to do that in a hurry fed governor progress on inflation has slowed and maybe it is even stalled at this point. So no hurry, no urgency, not there yet, need to get confidence fed chair powell the highlight of the week, a lack of further progress so far this year on returning to our 2 inflation goal the recent data clearly not giving us greater confidence and instead indicate its likely to take longer than expected to achieve the confidence they said the same thing and said what market was expecting and the market was sort of ahead of them on pairing back rate cuts for the year. Will we get any . Thats the question. And will the next move be a cut in market seems confident on that point and the bull case for stocks thats the next thing we have to look forward to and see the inflation rating. Yeah. Meantime host of stories on the wires looking at what a hot u. S. Economy and a hawkish fed mean for other Central Banks and economies around the world jim came up with this phrase brown chutes yesterday. Clever. Barclays said u. S. Preannouncement negative in four quarters as we work our way into earnings season and American Express mentioned weakness in small and mediumsized businesses we have a sound bite from the amex ceo when they were talking about sort of still strong environment on spending, but some softness. Have a listen. Spending by u. S. Card member continues to be soft but new acquisitions, retention and Small Business credit products continue to be strong. The Small Businesses. We also heard from john mueller, ceo of p g on squawk box earlier, he was saying that in the u. S. And europe in particular, they really see strong consumption, and he was asked about trade downs, whether people were trading down to more generic brands instead of the premium p g higher price brands. Listen. One of the metrics that we look at to assess trade down is the progress of private label shares theyre up modestly in the u. S theyre flat in europe in both cases were growing share and volume ahead of that why is that . Im certainly not denying the reality that others might see, but weve concentrated our portfolio and daily use categories where performance drives brand choice. I just got off the phone with mueller asking him, i dont understand why volumes are coming down across consumer packaged goods and youre seeing higher volumes at these prices, theyre tide, laundry detergent performs better in cold water than their competitors do in warm water why is that important . Apparently savings you 150 per year if you are using cold water to wash your laundry than warm water and better for the environment. So people are not willing to trade down if their toothpaste and tide are performing better. He talked about effective messaging and its hard to compete with p gs marketing prowess and Budget Health care was a miss fabric was a miss. And baby, which a lot of people understand that story, also a miss. They had softness in certain markets like china and the middle east, for instance, where theres been tension, but i think encouraging trends overall on the u. S. And Europe Loreal also talked about strength so, you know, its just uneven which we continue to see, and it just shows a consumer that continues to prioritize. For the market the s p and the nasdaq, are now on pace for their worst week of the year lets break down the word ahead. Wharton school of professor finance Jeremy Siegel joins us do you think its justified given what weve seen on rates and geopolitics . Headwinds piling up . Well, sara well, know we had an incredible, steady rise from last october, almost recordsetting, not a 2 decline, and, you know, that actually is not healthy because you have momentum players jumping on the market. I think a little pullback by the way i dont think we have a 5 , which is the minimum definition of a pullback, but a little bit of softening is certainly not unhealthy for the market i think were going to get a good pce deflator number. Next friday. Next week yeah which i think 2. 7 it will be the lowest in three years. Thats only 0. 3 away from the yearend target that the fed set in march of 2. 4 for that deflator i think, yeah, we had three disappointments on cpi i think pce will come in, and i think our cpis are going to start coming in, in may and june when we take a look at the futures weve squeezed down to basically one cut. Yeah. By december i actually think we could get more if we get these good deflator numbers and inflation numbers. I think, you know, i still see gains in the Market Going Forward this summer. I foe that pce is the feds socalled preferred inflation measure, but the cpi has really captivated the attention of investors and of the fed you heard me go through all the reactions of these fed members and they changed their tune after the march cpi report how are they going to explain, if you think theyll be encouraged by a better pce, which they should be, how do they explain that gap and how do they convince investors, the american public, themselves, that theyre doing the right thing, if theyre cutting based on pce right first of all, the cpi and the Producer Price index come out a couple weeks before the pce. Its the most informative data that economists and the fed has to predicting that pce i look at the cpi much more importantly also but i see good trends forward looking in that cpi. For instance, weve talked about the fact that the shelter actually sherlter and insurance are more than 50 of the last 12 month cpi core increase and looking forward, both of those look very much more favorable, particularly the shelter segment, which is 41 of the cpi core so looking forward, those are those are very promising and important factors that could suppress the cpi and that will feed into the pce deflator. So your view is were going to get more cuts now than the market is expecting, and thats a good reason to buy stocks . Yeah. I think now that, you know, we could all say at the beginning of the year the market was way over, way optimistic, four or five cuts and now its squeezed down to one, and i actually think that we might get two or three cuts by the end of the year i dont think the fed knows or anyone knows they follow month by month what the data is, and by the way, one thing thats important that chairman powell said, he said there was disappointment in the cpi. However, he is it say we have a dual mandate, if the economy softens and you mentioned that some people are talking about a softening march or april, that is another reason for us to cut rates unless inflation is out of control. They really have to look at both of those, and i found those words to be very encouraging in terms of forward action for the fed. I cant shake some of the ceo commentary weve gottenen from the brngs, thinking of james gorman saying i dont think were going to have any rate cuts this year or ceo in the tech space or in the food space, saying the economy is too strong theyre not going to cut rates this year . Well, actually, they should cut rates if inflation goes down even if the economy goes on. That is the super best case for stocks,s as we know going forward. Inflation going down and economy staying strong they dont forget, they regard the current 5. 3 fed funds rate as restrictive and if they see inflation moving towards their goal, long run, they think that the fed funds should be 2. 6. I dont think it should be that low. I really think it should be 3. 5 to 4, but thats still a point and a half below where we are today. They regard the current levels as restrictive if inflation goes down, they will lower those rates just on that basis alone even if the economy chugs along. Okay. Jeremy siegel, thank you very much for weighing in. Thank you. Appreciate it the bulls will like to hear that the s p down. 2 our road map for the hour. Shares of netflix tumbling posting blowout earnings and guidance falling short should you buy the dip well speak with one analyst who raised his price target. Watching teslas troubles today. Shares down for a sixth straight day sitting at new 52week lows. The company is recalling cybertrucks for some issues and well look ahead to teslas earnings on tuesday. Shares of trump media rallying again but warning about the trading of the stock new details of that. Big show still ahead squawk on the street will be right back norman, bad news. I never graduated from med school. What . But the good news is. Xfinity mobile just got even better now, you can automatically connect to wifi speeds up to a gig on the go. Plus, buy one unlimited line and get one free for a year. I gotta get this deal. Thats like 20 a month per unlimited line. I dont want to miss that. Thats amazing doc. Mobile savings are calling. Visit xfinitymobile. Com to learn more. Doc . Welcome back to squawk on the street. Shares of netflix are falling, blowing past earnings estimates thanks to a surge in subs but the company will stop reporting quarterly subs beginning next year coceo greg peters talked about it on the earnings call. We have line of sight, value translation mechanism we expect will deliver and contribute to Business Growth for the next several quarters to come all of those improvements could allow us to effectively get more of that 500 million plus smart tv households to become members. Mentioned hundreds of millions yet to come. This is a way to effectively get at more of those and make them part of our membership base. Steven has an overweight on netflix raised his target to 726 from 650 happy friday good to have you with us again. Thanks for having me on, carl. Youre still looking at revenue flywheels and expanding margins, is that the story that is i think flywheel is sometimes an overused phrase in our industry, but netflix does have one in their ability to keep growing revenue through subscribers, advertising, pricing, and then to keep spending more on content and to grow that content spend a little less fast than they grow revenue. Thats where everything drops through to profit and cash and why were bullish on the stock. The oneyear performance has been stellar and that was one reason we got one downgrade on the street today when does valuation become a concern . To me i think if the p e ratio is massively outpacing the Earnings Growth then thats the red flag for us. You mentioned our new target price, its based on 29 times p e. We have a 30 eps, so we think those are fair stepping back, the other thing we see, is that across the market its so rare to find an Industry Leader also compounding earnings at this level. If you look at netflixs share of tv time, share of streaming time and entertainment, they are in a league of their own from a market share perspective. How should we feel about the ending of subscriber reporting on one hand it reminds me of when chinas youth unemployment numbers went up past 25 , they were so bad they stopped reporting them like is that the signal there . Because the subscriber numbers for netflix this quarter were strong. Yeah. I think its great question, sara and i think, you know, that result tells us a lot about what theyre thinking, theyre doing this from a position of strength theyre not trying to tell people theyre worried about subscribers and thats why they want to move away from the metric i think theyre trying to move away from some of the short term that has been part of the stock when its been a net ad story and trying to focus on a little bit more long term outlook because thats how they run the business i cover a lot of stocks. Very few of them could get away with changing that disclosure, but netflix is doing it from this place of confidence and strength i dont think the market is too worried about it. Right we talked this morning about retailers, for example, used to give monthly comps that kind of went away and life went on, but fascinating story and interesting quarter to dig in on if you get the transcript from last night thanks good to see you. Thank you. Still to come, the bitcoin halving is upon us and what it could mean for gains for bitcoin which is up today. Were watching shares of apple, wall street journal saying china ordered the company to remove the popular chat messaging apps from its app store in the country due to, quote, National Security concerns Metas Whatsapp and threads, signal, telegram and line were taken off the app store aas result were going to continue to watch that story and dont go anywhere this is our future, ma. Godaddy airo. Creates a logo, website, even social posts. In minutes how . A. I. impressed ay i like it who wants to come see the future . get your Business Online in minutes with godaddy airo you founded your Kayak Company because you love the ocean not spreadsheets. You need to hire. I need indeed. Indeed you do. Indeed instant match instantly delivers quality candidates matching your job description. Visit indeed. Com hire check out shares of trump media bouncing for a Third Straight day up almost 2 . A wild week of trading up about 6 overall on the week following days of declines and now trump media warning the nasdaq of a potential market manipulation of the Company Stock by short selling of shares. The latest warning after trump media gave shareholders detailed instructions on thow to avoid someone loaning out their shares to short sellers. Strong bounce though off the low 20s. A volatile session for bitcoin, prices dropping below 60 k ahead of its halving event when the rewards for miners are slashed in half, happens every four years written into the code of bitcoin and a slowing supply of bitcoin into the market what does mighean for crypto prior markets preceded a bull run. They write that may be priced if knew invested in the last halving you would be up 750 , although current bitcoin prices have fallen more than 10 off their highs of the year so far. Strong for the prices, not the miners, right. Because the miners then see their revenues fall on the news. Shares of tesla hitting 52 week lows today now news of recalled cybertrucks ahead of teslas earnings well discuss the road ahead for the company and stock icwhh is trading at 52week lows. Moving forward with nodepositive Breast Cancer is overwhelming. But i never just found my way; i made it. And did all i could to prevent recurrence. Verzenio reduces the risk of recurrence of hrpositive, her2negative, nodepositive, early Breast Cancer with a high chance of returning as determined by your doctor when added to hormone therapy. Diarrhea is common, may be severe, or cause dehydration or infection. At the first sign, call your doctor, start an antidiarrheal , and drink fluids. Before taking verzenio, tell your doctor about any fever, chills, or other signs of infection. Verzenio may cause low white blood cell counts, which may cause serious infection that can lead to death. Lifethreatening lung inflammation can occur. Tell your doctor about any new or worsening trouble breathing, cough, or chest pain. Serious liver problems can happen. Symptoms include fatigue, appetite loss, stomach pain, and bleeding or bruising. Blood clots that can lead to death have occurred. Tell your doctor if you have pain or swelling in your arms or legs, shortness of breath, chest pain, and rapid breathing or heart rate, or if you are nursing, pregnant, or plan to be. Im making my own way forward. Talk to your doctor about reducing your risk. Are you keeping as much of your investment gains as possible . High taxes can erode returns quickly. At creative planning, your portfolio is managed in a taxefficient manner. Its what you keep that really matters. Book your free meeting today at creativeplanning. Com. Well back to squawk on the street. Im Silvana Henao with your cnbc news update. With 12 jurors seated in former president trumps hush money trial court is back in session this morning to choose the sixth alternates to fill up a jury the judge in the case suggesting that Opening Statements in the crim until trial could begin as early as monday. In the wake of israels apparent attack on an iranian air base and nuclear site overnight the g7 Foreign Ministers gather in italy today are warning of new sanctions against iran and urged both sides not to escalate the conflict any further secretary of state Antony Blinken said little about the strike only that u. S. Was not involved in any offensive operation. Tesla issuing a voluntary recall of about 4,000 of its cybertrucks. The reason, a potential issue with the accelerator pedal according National Transportation safety board, when a lot of force is applied to the pad on the accelerator pedal it could dislodge and cause the pedal to get stuck carl sylvania, thanks. Goolsbee the sole fed speak today and we have fresh headlines crossing right now Steve Liesman has details. Carl, ending the week of eventful fed speak, one of the dovish president s sounding hawkish based on what he says in prepared remarks this morning and weve been watching what he doesnt say. Austan goolsbee saying the restrictive monetary policy, he calls it restrictive, is appropriate given that inflation progress has stalled the past three months of inflation data, it cannot be dismissed. Unclear if this marks a change in his baseline outlook for rate cuts goolsbee remains hopeful that inflation progress will resume and declares that the fed will get inflation back to the 2 target, but he says it makes sense to wait for greater clarity on the data before moving on the optimistic side, goolsbee sees improvement that could bring inflation down and help the economy this year notes hes been surprised housing inflation has not fallen and say its going to be difficult to get inflation to target without that decline in home prices he does not mention at least in the prepared remarks the march forecast that he had for three rate cuts this year like other fed officials this week, doesnt say it will likely be appropriate to cut rates in 2024 now next week a big week for investors to balance the concern about the fed and inflation and earnings and the economy, we get gdp, which is pushing close to 3 in the atlanta fed gdp now and the feds preferred inflation indicator the pce along with a surge in earnings about a third of the dow and s p next week. The gdp outlook risen by nearly a full percentage point in the past month, upside surprises from the consumer, manufacturing, and jobs sparking those Inflation Fears but earnings running to this point about 10 ahead of expectations. Guys steve, people are still kicking around some of the data from housing this week in particular, the existing sales number and the median home price there which some argue is well above the shell shelter component of cpi do you think its past time for housing to start to show up in the macro number yeah. At some point you have to give it up, carl. I dont know that anything the fed does or doesnt do is going to fix the housing problem its almost like you want to think about the inflation problem we have. I know its a little bit, but exhousing im not sure whats happening in housing is related to fed policy here think about it, when you do a thought experiment f the fed lowers rates that makes housing more affordable and more people buying on the fence and if you raise rates that makes it less affordable i dont see a way that the fed cutting, hiking or staying the same is going to fix what is a secular deficit. I wonder if you can say that about the other components that have been sticky too i dont know what fed can do about Auto Insurance or medical Services Inflation and those are parts of why the inflation number reads so hot as well. Some of it is outside of the feds ability to effect. Overall, the feds idea as you know is slow aggregate demand with higher Interest Rates make it harder to borrow. You have a back flow weve been talking about which is which comes from higher Interest Income on the part of Many Americans now. The only thing they can do is stay the course, hope the supply chain issues that may linger resolve themselves and that, of course, we get to a new equilibrium in the labor market where okay, now we have the right rate to have the right number of workers working given the growth of the economy. Youre mentioning a question that we should be thinking a little bit more about because there are those out there saying you know what, the economy may just be in some zone here of 2. 5 to 3 inflation that may be outside of the ability of the fed to influence the fed would disagree but there are smart thinkers who are considering it. Its a good debate i think to have thank you. Steve liesman. Stocks are mixed here just one hour into trading. Dow is higher. S p continues to lose ground the nasdaq is down a full percent. Its been a tough week for the nasdaq week to date now, 4. 5 lower senior markets commentator mike santoli, almost combined you with rick, here to break down the action what happened this week . What happened this week was you had this continued unwind of this idea that we can have it all in the markets, which is, you can have the strong economy, earnings upturn, you can have bond yields stay tame, fed easing into all of that and then what happened is the momentum break, which is now still unspooling five straight down days. I think the result of that plus today and the overnight selloff in the futures, you have gotten the market at least short term technically getting oversold and the conditions there where we should bounce soon you see every rally in the last few days get sold down, but in a very orderly way and this tells me its systemic unwind of these mechanical strategies and its not yet being met with fundamental dip buying demand. An expensive market. If we bottomed right here somehow at a 5 pull back, 20 times forward earnings number thats pretty elevated still i would say about i think through history four out of ten pullbacks becomes a 10 correction do you like your odds or not i think youre going to see a bounce and you get the monthly options expiration out of the way today and maybe decide if this retest and repeated kind of visit of the 5,000 level of the s p is enough to just take positioning and expectations off the boil. Lot of discussion that its not really so much the fed as it is tech expectations, apple 11month low, nvidia, barons cover and down because they didnt upside preannounce. Exactly the nasdaq 100 chart looks a little ominous like it could be distributing out you have the massive out performance giving a lot of that back that being said, you dont want to necessarily get too confident of that view going into the meat of mega cap growth earnings season next week you could see the situation weve cleaned up positioning youve kind of taken the edge off some of the valuations you get through this period after this 5 pullback with the majority of stocks doing worse than that. And all of a sudden you get reminded of the profitability of these companies. You could sort of play it either direction on that front, but without a doubt, thats one of the things that has held this market in check. Aside from the fact that bond market continues to surge for the pain point for the consumer, for the economy. You guys were just talking about rates havent seen to have that much affect on inflation or growth maybe the market can change that at some level, whatever that might be. Were 7 off the highs for the nasdaq 100. Yeah. You see the pain. Interestingly, three sectors are higher on the week consumer staples, utilities and financials which you dont usually put together. Its the first sign of life for the pure defensive areas like staples and utilities and financials, i mean, Immediate Reaction to earnings not that great, but it seems as if they are benefitting from relatively sort of low expectations thats not a crowded group at this point right now. You know, well see. Berkshire hathaway 13 of the Financial Sector at this point visa and mastercard are big in there. Not just a pure read on banks, but it is telling the favorite crowded growthy stuff where youre seeing the pain and seeing more kind of boring defensive value, at least, you know, find some support here. Mike, well talk in a little bit. Mike santoli after the break well talk about the cracks in the armor when it comes to big tech. We mentioned tesla, apple, microsoft, nvidia down on the nth as well. Well talk with wedbushs dan ivess in a moment. Welcome back to squawk on the street. Tough week for tesla as you know on pace to end the week down more than 10 if shares end the day lower. That will the stocks longer daily losing streak since january. We know that tuesday is going to be a big day you say the clock has struck midnight and the line that struck out to me, trading in the model 2 for robo would be a tragic gamble in your opinion. I think it would be a gamble that could maybe even define the future of tesla in the next three to five years. I think right now the big nervousness is model 2, thats a key part of the group, thats 50 to 60 of the incremental growth of the next two or three years robotaxis, autonomous, not another five or six years. Weve seen over the last decade and been through White Knuckle moments for musk and tesla, this is up there. A cinderella story in the near term has turned into a nightmare on elm street. It all starts next tuesday needs to control the narrative if theres no adult in the room, there could be darker days ahead. If he really does say, were going to play this long game and its going to come at the expense of the 2, you would rerate. If that happened it would be a disaster of Epic Proportions because in the near term, youve seen others throw in the towel because of the fears of that and some of the stuff thats reported, that would really put a massive black hole or gap in the growth in the next few years. If you look at the last sort of 2015, 2018 there were levers that musk could pull and ultimately did pull and thats why its youve seen the history, but this for the first time in five, six years, long term, tesla bulls, are really calling, feels like theyre about to hit the elevator if they dont hear what they want on tuesday. Why are analysts like you and investors so down beat on the prospect of the robotaxi future . Bullish on robotaxi, bullish on autonomy. The problem is this would be like cook on, you know, coming out being like iphone 15, now look, were not going to have anything until iphone 21, but trust us, thanks for being on the conference call. So thats the problem, is that were bullish its always worked for him before. I think now the difference is you need a refresh competition coming from all angles, game of thrones were seeing in china and the credibility for musk has definitely been questioned because the last two Conference Calls weve talked about on the show, those have been trainwrecks. It all comes down to clock struck midnight. Tuesday night,adult in the roo needs to step up and navigate the story and thats why we call it a fork in the road moment we are still bullish on the longterm tesla story, but theres a category 5 storm and the pilot on the plane cant be ted striker. A lot of analogies and stuff there, but what do you want to hear the china competition is not in teslas control. Yeah. You need to hear four things one, whats the Growth Strategy in china, how are we going to rowers have the trend that were seeing in mainland china, which has been well call it 60, 70 of the incremental growth story for tesla how do they do that those cars are cheaper theyre nice i saw them on the streets and tested them. How are they going to reverse that growth trend . Hold prices, hold margins were going to bet on our brand. No different than what apple has done and many others including microsoft, depending on the products, but give the strategy there, what are the targets. Theyve to give guidance whats the targets on growth realistically. What do margins look like . Where does it trough out at . Ai and musk the 25 threat, recommit keeping ai within tesla. Shows fsd, showing autonomy. Thats been the problem here is that if you had an adult in the room to nav date, the stock i think 30 of the selloff here is musk driven. It all comes down to like you could talk the talk, you got to walk the walk. Tuesday is going to be would you say the most important quarter in several years the most important quarter in probably five to six years, and maybe, you know its most important call ever, and thats why i think this will be a historic moment one way or the other for tesla. Youve been bearish on tesla before ive gone through where weve been embarrassed because you cant be smoke and mirror. You need to stup up, otherwise this would be the grand canyon looking down at the cliff if they get rid of the model 2. Well talk on tuesday, im sure, if not before then, dan. Dan ives. It was a tough quarter for synovus but they still see bank credit ahead well talk to the ceo next on nserwh movers, his read on the coum, ere rates will go from here. Well be right back. 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. [sfx wind, rain and rolling thunder] nobodys born with grit. British announcer rose is really struggling. Its something you build over time. American announcer thats 21 missed cuts in a row. [car trunk slammed shut] for 88 years, Morgan Stanley has offered clients determination and forward thinking to create the future. Crowd stop it . Only you can see. American announcer rose, back in the winners circle. [crowd cheers] [music out] business. Its not a ninetofive proposition. ] its all day and into the night. Its all the things that keep this world turning. The gotos that keep us going. The places we cheer. And check in. They all choose the advanced Network Solutions and round the clock partnership from comcast business. See why comcast business powers more Small Businesses than anyone else. Get started for 49. 99 a month plus ask how to get up to an 800 prepaid card. Dont wait call today. Lets get another check on netflix. Subs crushing estimates adding 9. 3 million in q1, twice the estimate q2 revenue guidance did fall short and the company said it will stop reporting sub numbers beginning in 2025. Shares are down today. Still up on the year, of course. Up almost 90 and outperforming the s p. Lets talk taylor shiwift, releasing the tortured poet a album. Taylors Economic Impact has been farreaching. Her eras tour last year was the first in history to gross at least 1 billion ceos from a range of industries couldnt have imagined in their wildest dreams the impact of swift lift in their Earnings Release as fans flocked to stadiums growing more than 30 yearo yearoveryear amc ceo, movie theaters, literally all of the increase in amcs revenue in ebitda in the quarter was attributable to having shown the two movies in the u. S. And internationally disney ceo bob iger, after the Company Reportedly paid 75 million for rights to the movie saying, quote, we know audiences are going to absolutely love the chance to relive the electrifying taylor swift eras tour whenever they want on disney plus. Heres a surprising one, the ceo of Regional Bank, National Bank holdings saying on their conference call, i jokingly say i think it has something to do with taylor swift and the chiefs, but there is momentum in that market we are benefiting from, on kansas city the ceo of live nation, the Company Behind ticketmaster, said every 18 and 16yearold in the world that has a tiktok wants to see drake and taylor swift. We think were at the start of a new revolution the album is out youve heard it. Rob sheffield, i like his review in rolling stone, i feel like he nailed it its a lot of slow songs, which i like of taylor swift and its brilliant she should win a pulitzer prize. It is poetry, actually. Literally right there in the title. Im looking at the thr review, saying light production but highly personal. Processing a breakup is what a lot is about. A few breakups. I think its surprising how much she revealed the meta relationship but theres a lot in there shes in her 30s and still getting heart broken and vulnerable and has beef with kim kardashian, which is a really good song, actually. Its classic taylor. Interestingly, she wrote this while on tour. So, a lot of people think its a lot of these slow songs that are meant to perform in live stadium and an audience. The slow songs she does in such a big way. Thats what there are no, like, bops you would hear on the radio, you know, big hits like that but because its taylor, it will be hugely successful i dont think thats a controversial thing to say. A lot of listening parties last night, tonight and this weekend. Meantime, market trying to hold into a fairly tight range here dows up almost 200. Circling around the 5k level of course, the story of the morning is that as a result of a highly calibrated response to iran overnight, you got oil lower and yields lower across the board. Money movers will begin in just a few minesft t eak. Ut aerhe dont go away. Nt opportunities are everywhere you turn. Do you charge forward . Freeze in your tracks . or, let curiosity light the way. At t. Rowe price, were asking Smart Questions about opportunities like clean water. And how clean water advances can help transform our tomorrows. Better questions. Better outcomes. T. Rowe price the future is not just going to happen. You have to make it. And if you want a successful business, all it takes is an idea, and now becomes the future where you grew a dream into a reality. The all new godaddy airo. Put your Business Online in minutes with the power of ai. Good friday morning. Welcome to money movers. Im Carl Quintanilla with sara eisen live at post 9 of the new york stock exchange. Have yields tired . Tcws chief Investment Officer breaks down the move in the treasury market and how hes positioning his 170 billion bond fund. How rates are impacting the Regional Banking sector. The ceo of synovus joining us. Tumbling yesterday on falling earnings and weak Interest Income. New data on the commercial real estate sector and what new york citys largest landlord said happened for the first time in about four years. Meantime, markets mixed today. Were just south of 5k s p by a point. Health care, utilities leading in what is mostly a defensive posture, although energy u