Transcripts For CNBC Squawk 20240703 : comparemela.com

Transcripts For CNBC Squawk 20240703

Fed, the chair saying inflation is still too high. Weve got a big day for apple, which will report its earnings after the bell, this amid signs of an iphone slump and, of course, potential struggles in china were keeping an eye on shares of carvana. They are up as much as 40 in the premarket. Remember when that thing was close to bankruptcy . Well, this was a recordsetting quarter, and were going to talk with the ceo that will be next here on squawk on the street. Lets begin with the markets and the fed, the day after the chair delivered this message on rates. Its unlikely that the next policy rate move will be a hike. I would say its unlikely. You know, our policy focus is really what i just mentioned, which is how long to keep policy restrictive. Lot of takes today, jim bmp unequivocally dovish, you agree . Thats a hard one, because i think that b of a saying fomc meeting, wait and see. Fomc bias here, Morgan Stanley firm hold with the firm hold. Fomc stalling for time, wells fargo. I mean, i think that i like the idea that what hes really doing is saying, listen, ill stall for time, things will go my way. Hes confident he was not trapped, by the way, into saying something stupid, like, yeah, i know, i shouldnt have said what i said. David, theres a gotcha element to the media, but jay powell has been around for a long time, and he kind of knows how to speak without being trapped. Yeah, hes done enough of these that you would think he kind of knows how to navigate them yeah. We talk often, though, about at least what are these mixed pictures that we see in terms of the performance of the consumer, particularly medium to lowerend. Yeah. Reflected in any number of the earnings that weve been going over lately. I just continue to wonder how thats play for him and what and how he addressed that during the call, during the Conference Call im glad you mentioned it, because we just keep hearing the same thing strapped, strapped, strapped consumer is strapped consumer cant afford this consumer cant afford that yes and when you hear that, upgrade today, very important upgrade by ubs of tjx, evidence lab, saying, listen, when the consumers strapped, you cogo ti way. Carl, when i look at whether the consumer is strapped or not, i think that maybe the key person to talk to is a guy that, lets say, ernie garcia, because he has he has at carvana the best view i know, because that is a very fractured market hes got 1 of it, and people want used cars, because they cant afford new cars. Well get fords numbers, but i do think that garcia has the pulse of the economy well, certainly, they are relying heavily on the strength of the labor market, jim claims, 208. Looking for 211. Just continues to be robust, and well see what we get tomorrow its robust, but i think that people i dont know did they spend all the money they had did they become more frugal . Are they just more aware that everything went up in price, and they just dont understand why that happened . David, theres a mystery look, were not political, but if you were a political person, you would say, youre trying to relate why when you go to the supermarket, biden should still be president they have nothing to do with each other i mean, nothing. No. Listen, but rates are playing out through the economy. Sara talks about this all the time whether its your mortgage, whether its your car loan, whatever it might be, in terms of at least your borrowing, and if you are, you know, if youre strapped in some way, it may very well be because your monthly bill has gone up in some fashion as a result of what youre financing insurance electricity. We never talk about that electricity went up. We didnt think it would go up because theres nothing involved with other than to say nat gas being lower, but it is a quandary, and i think that the quandarys been met with things like netflix, which, again, is positive, not going out. Doordash saying that, you know, its okay. Its not theyre not spending more that way. We cant find them, for the most part we cant find where this consumer is who just had his or her Student Loans forgiven we do know that theres a bifurcation, a very rich consumer is still spending a notrich consumer will splurge on something thats experiential its like you have two economies. We have the taylor swift economy, just using something thats catchy, and you have the people who dont even want to do that and the dont even want to do that, i feel bad for them, because they are they feel like, as we learned in college, theyre lumped in prolitariate we just had a retail sales present at 0. 7 i agree i dont understand how these companies can say this stuff to me, we have unemployment thats so strong that allows you to be able to have to trade up, to get a better job. Its almost as if this is why i mentioned politics to begin with theres a negative mindset within the context of a positive economic backdrop. Meantime, oecd raises their Global Growth forecast for the entire planet and takes the u. S. From 2. 1 to 2. 6. Its a halcyon time, for heavens sake, and i think that the negativity may have much more to do with Current Events than it does with your wallet, david. Maybe i dont know i mean, im looking at ebay. Were going to have him on in the next hour. I think its poor execution ill ask him about it they are talking about Consumer Confidence being at low levels thats what you talk about when you have poor execution lowest levels since july of 2022 and navigating ongoing challenges in the Global Economy. Well, look, the ongoing challenges have not what, your pocketbook . Im just saying i dont know carls smiling well, look, im struggling with the idea that at any given time in the last 40 years, if you had job mobility like we have now, you could better yourself move up and make more money. Chipotle the managers are making 200,000 there, and theyre getting stock. Its one of the reasons they have to split the stock. There is no depression or negative thinking if you work at chipotle if you are a barista, i got to tell you, youre at tjx today. Yeah. Well talk some wayfair, where active customers, orders per customer, revenue per customer, all with green arrows. Well get to that. Ive got wayfair, and its incredible, because wayfair, theyre not making any money, but they fit the zeitgeist what about etsy does that fit the zeitgeist . For every wayfair, ill give you an etsy. Josh would admit he didnt execute well so, its execution when it comes to not a good quarter, not the economy, or not the weak consumer, and its just good execution if, in fact, you do better is that right . Yes so, starbucks, obviously, which well talk about in a bit, that was all execution yes okay. Mcdonalds price that was price. Yeah. Shack shack looks good today well, look, there are guys that you want to go spend more money. Remember, chipotle put through very big price increase and it didnt hurt them at all. I think theres a cup of coffee that can cost too much darden, we got. That was pretty okay they got not great that was a day ago thats a push olive garden is a push they had their rates priced. It didnt hurt them as much as i thought. But you know, look at mastercard, which, by the way, i think was misinterpreted, but the presumptuous of mastercard is that Consumer Spend has slowed down. The presumption of visa and American Express is that Consumer Spend is has gotten better mixed pictures in a lot of these. By the way, mike is a very good executer at mastercard i didnt think mastercard was that bad i think there was headline bad but i come back to execution when it comes to execution or price. The execution at qsr, restaurant brands, was superb and they blew away the number. When we come back, we will revisit starbucks, of course, after that interview yesterday and the stock slide with the companys ceo told us on this program. Get to a bunch of other names, qualcomm, corvo, novo, neo, with futureloinsod ts s okg lionhi thursday did i read this . Did i get eggs . Where are my keys . Memory and thinking issues keep piling up . It may be due to a buildup of amyloid plaques in the brain. Visit morethannormalaging. Com 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. Speed of Service Improvements weve seen are real the opportunities that we have with the new processes that were rolling out suggest to us that we can make that even better, and the entire Leadership Team is focused on ensuring that we make improvements as we go in order to increase that speed of service even more. Well, laxman, the speed of service is real. Thats a fanciful statement. Its the exact opposite of what is happening and i dont know how you can say it on our air. Jim, the facts are, we have improved speed of Service Quarter over quarter if you look at how the processes that were rolling out, particularly around peak, what we are finding is that we have options to improve that even further with changes in processes and tools that we provide to our partners at peak. But you said that people are using the mobile app, and they are not able to get what they want because they cant. Its too slow. I think your throughput is awful, sir and i do not understand how you can say service is good and also say at the same time that throughput is awful. Starbucks chief, laxman narasimhan, with us yesterday. Company shares coming off their worst postearnings daily decline in about a quarter century. Look, im not saying im some expert just because i owned restaurants for 12 years or that i was in this business a long time ago, but there is a there are measurable people who know what theyre doing. Ron shake, when he ran panera. Most certainly brian niccol, when he runs chipotle, and they know that the key is throughput, which is getting people in and out. There was a moment where ron told me his son went into a he went into a panera and said, dad, theres a mosh pit there, people who dont know what theyre doing, theyre waiting for stuff, so he created panera 2. 0, went to charlotte, north carolina, developed new stores to fix it and didnt do it overnight. Said, listen, i got to spend a year i used to speak to him every month and say, when is it going to be ready . But he literally found a second way, and then he rolled that out, and thats what starbucks needs to do, because they have terrible throughput. I was a little surprised when you go over the numbers and the throughputs bad and things are deteriorating, you cant come on our air and say the throughput is good and things are Getting Better thats a suboptimal strategy its ill advised to come here. The numbers are the numbers, and the forecast is the forecast, to quote the great frank slootman, who used to be at snowflake. You cant do it. Its just not right. I had a bad year in 2001 at 20 and i had a bad year in 2021 if you had asked me how i did, and i said i came on and said i had a good year and you were aware of how i did heres what you would say to me. Get off my show. I dont hear you defending a level here at 75 the way you did apple. My travel trust owns it why do you still own this thing . You cant sell it after we talk about it. I told you the rules again and again. I know you do i told you the rules. Listen, its hard, man. Its hard to get all this stuff right from a stockpicking standpoint i screwed up. Im not blaming him. I screwed up i still own shares of comcast. Well, yeah, you have its the only name were allowed to own, by the way if you worked for abc, you could sell your comcast. Yes then i would own disney. Oh, geez they report next week would have been a lot actually nelson peltz, where are you please, what are you talking about . That stock is up 22 this year, and i would assume next week dont get distracted. Dont do this oh, i will get distracted dont do this alinear thinking only one of us can do that . The problem with starbucks is they have a big throughput problem. They have a mobile order, and you have to wait for it because its too crowded now, you can say, well, too crowded is a positive whithing. Im saying, it doesnt matter. When numbers are going down, you cant say that service is Getting Better because the numbers dont let you. What would i have done i would say, look, we have to rethink. The numbers are going down we had a worse quarter than the previous quarter, and were going to solve the problem but we didnt do a good job. You know what happens when you say that to me i think i just found out. I say, thank you, sir thank you. Lets figure out together how to get it better. Thats all i wanted was a recognition of what was in the Conference Call and what was in the numbers, which was the things are deteriorating and then it would have been very c convivial. Theres a way to make me a c convivial person say what you said in the Conference Call. Thats all meanwhile, were waiting for ford auto sales for april. Lets get to phil lebeau today carl, take a look at shares of ford, april auto sales falling 2. 4 , but the numbers in terms of the types of vehicles they sell, thats the most interesting thing here i. C. E. Vehicles down 9. 2 . Where are people shifting . Well, theyre clearly shifting towards green vehicles, if you will ev sales in april, more than doubled compared to april of last year, up 129. 2 hybrid sales, up 59. 5 look at the f150 hybrid, the maverick hybrid. Hybrids and evsnow make up 14 of fords monthly sales. A year ago, guys, it was 8 . Weve said this about ford weve said abit about practicaly every legacy auto maker. There is a shift toward evs but more towards hybrids that is clearly coming through in the april Sales Numbers let me just ask you, phil, they, at ford, really decided to go they really did not emphasize ev on that last Conference Call. Are they just clearing inventory at a low price is that what happened . In terms of evs or hybrids . Ev. No, hybrid, theyre doing great. Im saying, whatever they did in ev, you know, they are the evs so low now is that mustang so low that we should go buy one . Theyd make a good deal . Well, they did see that when you lower the price, as they did on the mustang mache, take a look at the april Sales Numbers for the mustang mache, more than triple chaired ompared to e they were a year ago theyre also increasing production on the mustang mache and the f150 lightning, though the lightning production is not going to be what they originally thought it was going to be pricing still is whats driving evs. Phil, let me just not just with ford but all automakers phil, i got another recall yesterday on my maverick, this time on a taillight. When are whens the quality going to get better . Well, on the last call, they talked about it. Jim farley talked about the fact that they held back on releasing the new f150 until they could reduce, dramatically reduce, the number of problems so that they would have fewer recalls they believe that theyre making progress there they are. But look, any time you get a recall announcement, you know, its sort of like, oh, here we go again but they do believe theyre making progress. I know what im doing saturday, phil im visiting my ford dealer. Were going to get to a lot of other auto news, including some news surrounding tesla. Interesting note out of Morgan Stanleys adam jonas today well get cramers mad dash, countdown to the opening bell. E reoohe afureonmo lk ret tus. Dont go anywhere. G at schwab iw powered by ameritrade, 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. 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. grandpa im the richest guy in the world. man 1 i have time to give. man 2 i have people i can count on. grandma and a million stories to share. vo the key to being rich is knowing what counts. In general, were not seeing the signs of strain on the consumer, but it has something to do with the segment that we pr operate in, which is digital and delivery i do understand there are some headwinds that certain merchants face when it comes to instore traffic, but when it comes to all things digital, were actually not seeing, i think, those same signs of strain that was tony xu, ceo of doordash, founder as well. Lets get to a mad dash about doordash, which is going to be down sharply look, ive got to tell you, i thought tony xu was selfeffacing, in some ways too selfeffacing. This is an example of the opposite of what i saw in starbucks. I thought it was a good quarter until i read what tony felt he should have done hes a perfectionist he was not happy by the way, david, they have a lot of stockbased compensation. Yes enormous stockbased comp. That made me feel like they havent done the big pivot that we know that the airbnbs have done but i know hes very hard on himself, and the incrementally negative readthroughs about uber eats, i thought they were okay i was surprised that the stock was down as much now, it is this was a victim of this. Okay yes its just up a lot. But when you read through it, youve got you get the sense of a great ceo, whos just saying, listen, i didnt do this, i didnt do that there were some rule changes in new york and seattle that hurt things for him he said it didnt matter that much, but i find that this man is so selfcritical, and there was so much selfremonstration in this that i thought he took the stock down interesting i think he did. I know him from the Restaurant Business he just is a perfectionist this was a quarter which just said, you know what, im still not doing my job as well as id like really remarkable conversation all right well, well keep an eye on shares of doordash well be talking a little qualcomm and apple we

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