What's on the horizon for financial markets? At PJIM, it's a question that over 1,400 investment professionals relentlessly research in pursuit of your long-term goals. Specialised across asset classes, but united in collaboration, our teams provide global and local expertise. Our investments shape tomorrow, today. Pursue your tomorrow with PJIM, a leading global asset manager. It's Jim Kramer here. You're listening to the opening bell of CNBC's Squawk on the Street. Don't miss a minute of the action. Good Wednesday morning. Welcome to Squawk on the Street. I'm Carl Keaton. Hey, what's up? Jim Kramer. David Fabers back in post nine of the New York Stock Exchange. Futures under some pressure as the street begins to consider just how turbulent this rotation might get. Vicks above 14, first time in six weeks. Earnings guidance, a bid choppy two with JB Hunt Spirit and five below. Robot begins with the rotation in the market. Is the Russell 2000 still the star of the show? Also ahead of double whammy for the chip sector this morning. We're going to look at where the White House and former President Trump fit into that picture. Plus a number of earnings to get to this morning, including market reaction to results from Johnson and Johnson. Let's begin with this market rotation after yesterday's three and a half percent gain for the Russell. Jim, 12 percent in five days. That's going to be the best run in about four years. It's a little unnerving because the stocks that are leading it tend to be stocks that have no earnings. They're small. They're all up 50 percent or more. I mean, look at the top 10. We have such, maybe that gave it back so we can go right to him. David, it prelude therapeutics, a Pacific bio or rural innovation, caribou. I know. That used to be a coffee company. Lantheus, we know that's real, cipher mining, method electronics, Solaris oil field, IgM. That's the leaders of this. So, should we just go all in in this index that everyone says is the place to be? Well, that is the question right now. Everybody wondering whether this can continue past, what, an 11 and a half percent move in the Russell 2000 over five days. We are now talking about, I think, a standard deviation in terms of move versus the S&P of some six, which is not typical as, of course, you'd expect, given that's the standard deviation move. But it's causing a lot of pain. Yes, it is. Yes, it is. There are those who are shorty. You know, if you're running a hedge fund, you may be short the Russell and the way you're not even completely aware of is parts of your portfolio to your point. There are any number of smaller healthcare companies you like that are certainly benefiting at this point. Not a lot of liquidity in the actual names in that index is one thing to buy, but the names themselves. Thank you for saying that. It's very difficult to get in and to get out. Yeah, you know, these things are up. I mean, if you look at the parabolic moves, I mean, obviously, if you buy 25,000 shares of some of these, I mean, the size of these is the largest, it's 341 million large gain. And then you've got companies that are like caribou, that's 246 million, it's up 59% lose loss of $1.38 last 12 months. And we're supposed to say this is it. This is the move of a lifetime and you better get in. I think people have to be a little under the hood. And when they look at these, they say to themselves, well, listen, aloe gene therapeutics has lost $1.72, it's up 45%, 729 million. No, I am not going to play this game, but they're just, are they just buying the index? Yes, they're buying the index. And that's it. Yeah. And there's no liquidity in the other side. Yeah. Thank you for mentioning this. Well, this is what Elaine Garzarelli was saying at the beginning of the year in '94, when the Fed suggested that their tightening was ending, Russell went up 55% in 17 months. Well, we need to see a rotation within the Russell. We have these companies. Now, look, there are some very good companies in the Russell that are up 30%. A lot of them are kind of like Hertz Global, which is up 30, or Riot platforms. That's a riot in itself, Generation Bio, Peak Stone Realty. But then again, you do have companies that are, not Alster, don't forget that one, you do have a lot of companies that are at the bottom of the up 20, 25. And they are real. Like, Besar Home is a real home builder and the home builders were very strong yesterday. But for the most part, these companies are that they don't really resonate with the American people. So she may be right. But if these stuff go up that much, you want to short this mark with every half. This is the big list of froth. So the rotation ends? This is a froth. I mean, what ends? You know, rates are now what were 4-1 on the 10-year or in that range. I like small, medium-sized business. I don't like micro, microcap. David, it's too related by Joe B. Aviation. Why? It's going to be a $70 trillion. 9 trillion. 9 trillion. He remembers. Well. Because it struck you at the time. Of course, I can't remember the number anymore, but I bet you did. 9 trillion. This is a Morgan Stanley report, just to refresh. I believe that-- Yes, absolutely. May just stop me in my tracks at the point where they said, yes, the aviation market for these kinds of-- for the flying plane. Oh, that car is what we talked about. I mean, now there's-- Not really. I feel more-- you said we'd be safe in Foghorn Therapeutics, David. Foghorn Lagorn. No, I mean, I don't want to make too much fun, but I do. This is not the list that tells me that, you know, what, we've got to get all in. Now, Elaine, I like Elaine. Remember the grade 87 call, but my problem is that we can discuss this list all we want. This is just a list of froth. I mean, you go to Starbucks, which, of course, no one does anymore. And you say Chippewa Vente Cabuccino with froth? Well, this is what they produce over and over again, which is why the quarter was so horrible. It kind of brings us, Jim, to slightly larger names that are issuing a lot of downside pre-announcements. We looked at Spirit. We mentioned J.B. Hunt's guidance. Five below, of course, is a story today. Let's get some of these. Spirit, let's talk about a pre-packaged bankruptcy. Now, they were going to merge with JetBlue, and it was going to save them. That was broken up by antitrust. But I think the Trump administration might have let that one go through it. Well, I don't know. They take that Palm Beach trip and it's going to raise the rate. That's a Palm Beach trip that is, that's a moral lie gone. I mean, we don't want to speculate. I don't really know. It's worth, I mean, what's the market cap on this poor thing? It's not beginning. But five below. That's one of the names you were just talking about, right? It's a tiny little company. But five below is one of those, probably 46 million. Yeah, it's not, it's not, it's not really the fulcrum of this move. No. Five below, Joel Anderson, who's been on mad money a number of times, you know, this is one where they don't even say he left to spend more time with this family. They simply say left. Well, don't let the door hitch on the way out. Now, five below, every time he's been on ice, you can't keep adding stores with bad same store because that's the classic way to happen with WT grand, if you want to date yourself, which is that their total sales look great, but the same store is terrible and they got it down six, seven, but this is a company that's been hurt by China, hurt by the consumer, and hurt by shrinkage, like almost, I mean, Costanza, like shrinkage. When you say hurt by China, you know, we obviously over the last couple of days saw weakness in high-end luxury names such as Burberry, Hugo Boss, Watch. We're not going to, not go to five below. Correct. And we're waiting for LVMH. I think it's next week. But so, what's the heartiest? It's the heartiest. Hurt by China. What? No, no, they couldn't stay five below. That's the problem. So they were starting with kind of like five below. Hurt by competition from China. Oh no, it's just too expensive. They have five below. All right. You didn't answer the question. What about China? What do you think it is? What do you think it is? When you think it's supporting good store where, if it's five below, you buy their stuff, like VF Corp, what you see in the deal with VF Corp, they sold this. I wanted an answer when they said they were hurt by China, what they were hurt by China. No, it's just you can't, there's a problem. This stuff is cost too much to make, so they can't stay below five below. Plus they also had those self-checkouts in the front like CVS where I still call, I'm high-value. I pay. In-person. Yeah. Well, I use those machines. No, most people just, you know, you actually give them your money. There's a, David, there's a, there's a CVS in Westampton. I have pain. I feel like such a sucker. Do you? Yeah. That's the same way getting on the subway every morning. I feel like, hey, I'm paying. You don't, you don't hop? No, I don't hop. I would be so. At this point. That's an Olympic. I can't. I can't hop. That's just more squeeze even. I jumped herself. No, I'm happy to. So I'm happy to be paying. Everybody else fell similarly, but they don't. It's good to have you back. Oh, it's good to be back. I'm sure it is. It's good to be together. Lloyd, what is this, the California Room of the Shining? Yeah. Meantime, it's a rough morning for the chips today, including Nvidia with the US now reportedly mulling a ramp up of its chips crackdown on China. According to Bloomberg, the White House has told allies it's considering using the most severe trade restrictions available if companies like ASML continue giving China access to advanced chip technology. Meantime, he got this interview in Bloomberg Business Week with former President Trump, claiming Taiwan took about 100 percent, he says, of America's chip business and should pay the US for defense in his words, Jim. How stupid are we? Yeah. Well, I mean, I don't want to say that that's kind of, it's an old vice position because what happened is that Taiwan sent me, the man who runs more shiny, he was here, he recognized that they have many more engineers in Taiwan, which is per capita, it's much cheaper to make things there. So obviously, the real intellectual property is KLA and its applied materials, ASML, and of course, LAMP. So those are the ones that have been at the forefront, but the president has said over and over again, you can't keep sending this stuff ASML. We have the ability to stop you. Right. And the ASML is basically saying, well, I don't really care about what you have to say, President Biden. Well, you know, they have, although, I mean, the company was based and created as a result of US technology, certainly its history in terms of bothography and everything else. It's obviously very important in chip making. Very. TSMC, as you might expect, a huge customer. That's in Taiwan. So that's not what we're talking about here, but a number of these chip makers are facing are finding themselves out of a market where other competitors are able to benefit from it. Correct. Although at the end of the Bloomberg story that basically is the key here, I did kind of laugh when they said the US export controls are costing effective American suppliers a total of $130 billion in market cap. I kept thinking $130 billion in market cap. There was this one time high, 130th of Nvidia, or one day, you know, a move either way in Nvidia. Okay. Let's understand that applied materials already took the hit, about $2 billion. Lamb Research took the hit because the president said listen, you can't give them the latest and greatest ASML did. No, I mean, you know, level the playing. Now, of course, because the market's so stupid, ASML goes down and lamb goes down and plop. Lamb and plop shows have already had the hit ASM has. Although they did issue this Q3 orders forecast that was light. Well, still up 54%, but they did say it was going to be the same as 23. That was surprising. But look, what matters is that ASML has not played well, and the administration is absolutely right to go after them, to give them the fact that they haven't played ball. But let's understand that Secretary Romondo, Commerce Department, has done everything she can to make it so that key semiconductor plants are here, which is why Intel is up because it has really embraced that. But I think that the president is saying that Taiwan stole it, so therefore Taiwan has to pay protection in order to get- Right. That's a different president you're talking about. You get people confused here. Okay. So, candidate Trump is saying that you need protection now. I think that if they want to pay, they have to pay protection, they have to pay attention to get insurance. Right. Well, that's the same as he has with NATO, okay? Yeah. And there's no give without a get is the- No, but all these things are resonating in the market today. Both the story being reported by Bloomberg about potential crackdowns on those that are supplying continuous supply- And that's a president Biden, not clear about- Not clear about these funds ever work, because the Chinese are effectively increasing their output and sophistication of chips. Huawei has been able to operate with a new phone pretty well, and they're going to create their own ecosystem that's going to have no part of US supply in it, and be probably just fine. But separately, then you've got this Taiwan comments- Right. You can tell in video- Because it's up a lot, and you're nervous, and you're scared, and president Biden's after him in Trump- Well, isn't your club meeting at noon today about whether you buy tech at a discount? And I think that what's going to have me have to go to be the member of the club, but the one thing I would tell you is that knee jerk moves have historically given you a chance. That's how we build our infinite position, because people felt that this thing is just nonsense. You buy, but not. You have to do it slowly. We'll get some more on what the former president said about TikTok and J. Powell and corporate taxes. We are on track for a sharply lower open. Interesting diet of downgrades today of names like Chevron, Qualcomm, American, Morgan Stanley, when we return? At EverNorth Health Services, we believe costs shouldn't get in the way of life-changing care. And we're doing everything in our power to make it possible. Behavioral health solutions that also keep your projections at their best, it's possible. Pharmacy benefits that benefit your bottom line, it's possible. Complex specialty care that cares about your ROI. It's possible, because we're already doing it. All while saving businesses billions, that's wonder made possible. Turn more at EverNorth.com/wonder. Support for this program is provided by Chevron. Demand for energy is projected to continue rising in the future. To help keep up, Chevron is increasing their U.S. oil and gas production, and they're innovating to help do it responsibly across their operations, including their Gulf of Mexico facilities, which are some of the world's lowest carbon intensity operations, helping supply energy that's affordable, reliable, and ever cleaner. That's energy and progress. Turn more at chevron.com/meetingdemand. Welcome back to Squawk on the street, Rick Santelli here live at CME HQ at the last breaking news of the morning, industrial production. For June, up double expectations, up 6/10 of a percent, up 6/10 of a percent in the rear view mirror, the up 9/10 became up 7/10. So we see some positive numbers on industrial production, especially considering we started the year down 0.9. Now if we look at utilization rates, a nice little pop there as well, 78.4 expected. It moves up and confirms now it's 78.8. That is the best level of utilization since September of last year, although in the rear view mirror, we did downgrade last month from 78.7 to 78.3. Right now we have a 4/46 two year, that's up four basis points on the day, leading the yield curve for the second day, as longer duration treasuries are up and yield but not as much. Dollar index taking a big hit today in the end, set a couple of good rally days since the beginning of the week. Squawk on the street will return after a short break. At EverNorth Health Services, we believe costs shouldn't get in the way of life-changing care and we're doing everything in our power to make it possible. Behavioral health solutions that also keep your projections at their best, it's possible. Pharmacy benefits that benefit your bottom line, it's possible. Complex specialty care that cares about your ROI, it's possible because we're already doing it. All while saving businesses billions, that's wonder made possible. Learn more at EverNorth.com/wonder. Republican National Convention heads into day three today, an important one today. Amen Javors is in Milwaukee with the latest. Morning, Amen. Good morning, Carl. Unity last night here at the RNC as a parade of former Trump opponents took to the convention floor to praise him and offer their endorsement for him, including Ron DeSantis and the candidate who stayed in the race longest against Donald Trump, presented the biggest threat to him, argued that he was not a great candidate for the presidency. That is Nikki Haley. Last night she said this, "I'll start by making one thing perfectly clear. Donald Trump has my strong endorsement period." Now that came on the heels of a Bloomberg Business Week report yesterday, they sat down and interviewed Donald Trump, but among the things that he said was that in his second term he's considering Jamie Dimon of JP Morgan for Treasury Secretary, JP Morgan had no comment on that when I asked them about it yesterday. So no indication whether that is a real thing or sort of an idea that's just being floated out there. Also, the former president saying he would keep Jay Powell as Fed Chair, which goes against some of the reporting that I've heard from people close to Trump, who suggest that he would fire Jay Powell as Fed Chair in a second term. Be that as it may, there's a lot of speculation here about who the candidates could be for a second Trump cabinet, given just how good people here feel about their chances in November. A whole long list of names out there. I won't go through all the different names here, but you can see a lot of candidates for a lot of jobs. This is the background shatter at this convention, guys, because as I say, people feel very, very good about their chances in November. Back over to you. Yeah, Ayman, on Jamie Dimon, I'm going to add a little bit of reporting, just, you know, obviously last time back in 2016 there had been at least some asks of Mr. Dimon, he had said no, I think a number of times then, I think the expectation is if there were an ask this time, the answer would be the same, anybody who knows at least his wife or his three daughters could imagine what would happen in that family word he would say yes. That said, I'm curious on JD Vance, because I know, you know, you've been following this, I was out a couple of days doing reading like a lot of other people may have been about now the vice presidential nominee, aligned with Elizabeth Warren on some stuff on the banks, aligned with Lena Kahn on some things on antitrust. What is going on here? There's a huge sea change, generationally in the Republican Party and their approach to the economy, David. This is an era of economic populism and there's a group of economic intellectuals on the conservative side who spent the past five years coming up with a set of conservative populist policies that deviate dramatically from sort of the Chamber of Commerce Republicanism that you and I grew up with over the past 20, 30 years in the Republican Party. This is a very different approach. It's a worker-centric approach. It's about increasing wages, helping communities, helping families, not necessarily as concerned about prices and certainly not concerned about the opinions of corporate elites who a lot of these conservatives on the populist side view as on the other side of a cultural war. They view CEOs, people in C-suites as suspect and potentially shoving sort of woke values down the throats of their voters. They don't like that and they don't see themselves as aligned with those CEOs and corporate elites. This is a different approach than what we've seen from Republican candidates in the past, David, who have aligned themselves with the job creators and the big corporate executives. This is a different Republican Party and you're going to see different policies coming out of it as a result. I mean, you're the only guy really saying this and it's really important that people understand we're talking about a C-change that basically would say that big cap company sold out the workers in order to be able to make the most money in the stock market and it's time to help the workers and also I've got to ask you then, in 2026, we could renegotiate NAFTA. Is it NAFTA the bane of the existence of these anti-globalists? Yeah. Yeah. I mean, you look at trade across the board, the Donald Trump's proposal for across the board, 10% tariffs, that's not welcomed by some of the members of Congress you privately talk to here who are sort of the traditional Chamber of Commerce type Republicans. But you will imagine they will go along with that if it comes to the floor of the House of Representatives next year. Trade across the board is the fundamental issue for these economic populace and JD Vance is a person who is at the vanguard of this new thinking. I talked to Marco Rubio about economic populism on our air a month or so ago. And what he said to me was, look, Republicans who've grown up in the party thinking a certain way about the economy need to be aware that that hasn't worked for a lot of people and need to be prepared to change and acknowledge that they've changed their views, given the disastrous results that we've seen for communities, for the heartland, for industrial communities across the country, the Rust Belt. They argue that those policies largely failed base Republican voters that have led to things like the opioid surge and a lot of pain and disaffection among rank and file Republican voters. And they want to reorient the Republican Party to be the party of downscale America across all races and demographic groups. But this is now a working class party that views corporate elites as somebody who are on the other side of their values. So Google, Facebook, but also Disney, Anheuser-Busch, all of those companies have experienced that in one way or another. Expect that to continue now. The pick of JD Vance really signals a resurgence and a tilt toward, strongly toward economic populism in the Republican Party. Chamber of Commerce, politics not totally dead in the Republican Party, of course. But this tells you where things are going in the future, because all the young Republicans are on the populist side. We're also keeping note of the support coming out of the VC community and the billionaire community, which is another thread running through all of this interesting balance taking place. That's Eamon Jabra's in Milwaukee. We'll come back to you later on today. We'll take another look here at the pre-market as we got some futures under pressure and more squawk on the street is back in a moment. Welcome back. We're going to squeeze in a mad dash and an opening bell. What do you got? Well, desperate times require desperate measures. Put it in, you have to sell what you can sell. Yeah. Kind of like a stock point. You can, I've been to the, you know, that supreme, they were lines around the corner downtown. Right. The supreme store. What were you doing? Nothing. I walked by. I walked by. I walked by. Okay. I'm like, what are they all lined up for? Yeah. I know that we have great things coming up in the Olympics. Breaking, that's a competition. I didn't know whether you tried to get in there. No. You've been around your head. No. No. All right. Just let me show. Well, we have the mayor of Paris diving into the set to prove that it's clean. So that's progress. They make it out. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. Let's go. We have the mayor of Paris. doctors, and you have companies, small, medium-sized businesses that are doing well. I was chatting with David during the break, what Ayman is saying, what you're basically saying is, look, these towns that we see that are decimated, and this is Hillbilly Elegy, the big cap companies, they did leave, they went to other places, but the small, medium-sized stayed, and this is a celebration of the small, medium-sized, but Trump is not yet present. So, I mean, I think people are really enthusiastic, should understand that you're buying things that are almost required that that to happen, and you're selling things that could be very good six months. Do you think yesterday's move was, as some say, sort of, based on expectations of the Trump victory? Yes, I do. You do. Yeah, I do. I think that, look, there are people who are making their bets right now, and they seem, I'm using that word "bet" in a pejorative way, because they're not realizing, for instance, that applied materials took the hit on China, ASMO has it, but I'm not recommending these stocks are up huge, but I do say that there's, it's not distinguishing what should be sold, it's not, but I do say, and I'm going to talk about this in the morning, at my club meeting, let's understand, the market's up 18%. I mean, like, people are looking for a reason to sell, suddenly, we get a guy, I don't know if you saw the Diet Coke Coca-Cola exchange in the Bloomberg market, but I mean, you're kind of just saying, "Hey, listen, this is a good opportunity, it's too crazy, I'm going to take profits." And that's not, well, when it's really crazy you do it. With that money you go into cash, please, not, I'm not going to, if I go into the NASDAQ 2000, I'm coming on top of one of the most amazing moves already. Now, I understand it can continue, but I'm not going to get in front of a power ball move, just as it's happened before. These things can go down, and you know, you get one poll that says that a new guy could be Trump, where Biden is catching up in Wisconsin even though it's- There's 100 days to go, Jim. Right, thank you. So, I mean- There's a lot that can potentially change. That said, the current president is named Biden, and in fact he has been having an impact on the stock market this morning. We talked about it at the top of the show. You saw the, the biggest losers in the S&P are, as you'd expect, many of those chip-related names. Now, these are foreign-based companies that use U.S. technology, where the U.S. may crack down on them because they are transferring advanced chips in some way through their own equipment to the Chinese. And so there it is. Although, KLA is not, but it's ASML. Everybody's getting hit here, Jim, whether it's- Lamb came out and said that they lost $2 to $2.5 billion in sales because they stopped selling the China, which ASML has not. Right. But if it's in distinguished, even people are going to sell them all. They ought to be thinking about it. But then again, these stocks are up so much. Again, people are looking for reasons to sell Lamb, which has been one of the greatest performers of our era. As you see, one year up, 52%. The big trade, though, the big rotation that we've been talking about at least continues on one side, which is mega-cap tech in the early going year, the earliest of going, is down, met as down another 3%, Apple down 1.7%, Amazon, Microsoft, all off NVIDIA down 4%. Now it's also getting lumped in as a result to the chips. It was down 2% at 3%, and it was down 3% at 4%, and now it's down 5%. Keep Dean and I, and the idea of the U.M. open here still looks like it may be down ever so slightly. Look, there is a sense of both panic and give me some money. I got to invest in other things. We did hear, not that long ago from Larry Fink, CEO of Blackrock, that there are people who are taking on more risk. They're going into these ETFs that David just mentioned, an ETF, and when they sell, the ETFs just bang everything down. When they buy, they take everything up, and that's just kind of typical behavior. I'm not advising panic. I'm against panic here. I'm coming out selling against panic. I never heard you endorse panic. No, it's not really a strategy panic. I don't know how you feel. I try not to. Right. I try not to panic. Yeah. Yeah, not, I do try to feel. Is Steve Cohen never panicked in stocks? Is he panicking in other business days? No, no. Okay. What do you mean? I think he's referring to sports. When we went to the All-Star Break, in third world, Mr. Matt, I'm just asked 25 and 11 of our last 36. What's the best team in baseball? New York Mets. They're always the best team in baseball. Sometimes they just don't show it on the field. You can say this on the field. Jaylen Brunson guy. You got a good deal. Metta might be getting buffeted a little bit more than the others, Jim, because of the comments about TikTok from former president Trump saying, "You need competition and social." Right. And just so people know that's reels and Mark Zuckerberg's done a fantastic job at reels. I don't think anyone felt that TikTok would be shut down. By the way, this, Eszler and Luxautica, that is supreme? Buying supreme. For $1.5 billion to your point, it was bought for what? $2.1 billion. Buy VF Corp. How many years ago was that deal? Remember when the deal was? Do you know that they, that Luxautica has these AI glasses that are metas? And you can't get them. Now, I asked Mark to, I wanted to come on the show because this is just, they're impossible to find. And they're very exciting. Now, I have the first iteration where you can, I gave him my daughter. She just loves him. But there's this iteration of AI sunglasses sold out. No, I know nothing can move the needle, Metta. I know. But they are doing something with this. Remember how you like it said, listen, we're going to throw money down the rabbit hole with this platform. There are things that are working. And I just think it's worth it to point out that those glasses can't get your hands on. What explains chips taking it on the chin so hard and Intel being the number one as superior? Well, I mean, Intel's been the one that's most embraced. Gene Ramondo's commerce sector is planned to be able to open. So just a head start on the story? Yes. And if you look at John Ford, I mean, he's done some great reporting on what Intel's doing to putting up factories here. And that is not what Nvidia is doing. But what is Nvidia going to do? I mean, it's, it, you can't make this stuff here right now. Now, Nvidia, Intel being up three is there's typical overreaction. Because then you're going to get the quarter Intel and you're going to say, why did I buy it up three? Oh, yeah, right. It was some foundry. But that's what people are doing that. That's a pan at the short. And I just say, look, go ahead and do it. But understand it's a trade because Intel will not make the quarter. Right. You see some headlines out of Waller here getting closer to the time when a rate cut is appropriate. More evidence that first half data was in aberration cutting too soon would be a grave mistake. You did have Williams this morning as well in the journal, basically closing the door on July, it sounds like I think July was just a Goldman canard. And I enjoy Goldman's research. But that was just something that I think that was ill, ill advise that that piece. I think everyone expects if you read a bank after bank after bankers, a little prime wedding yesterday. They've got a schedule for what they think. And I think that the everyone's being September, 100%. And then we'll see what happens. That's not wrong. Jim, I want to get your take on J and J, which we haven't hit at all this journey. The stock is up about 1.8%. Still down for the year. Well, obviously no longer even close to the level at once had of being the largest market cap, pharma slash, whatever you want to device this company. Now, I mean, you let all of these double its size. That said, 2024 second quarter sales growth, 4.3% growth of 6.6% adjusted operating operational growth of 6.5% excuse me as well. Well, there was a lot of misinterpretation of the quarter because there's some different accounting issues when it comes to what they bought M&A. Joe will explain it to me really classically, which is that if people understood the accounting, you realize it's not a miss at all. And that is driving the stock. Plus they are July 26th. We're going to see the closing of the vote on talc. And they may have enough votes to stop talc litigation, which be amazed. Remember, no plaintiff has won since 2018. The vote is being is of the closure on because the courts, I think are accepting the prepack, the prepack is right for the litigation that right around the talc that says that it's our carcinogens. And that makes you feel like, well, maybe the stock's 200 value. They do have this, they do have a loss of exclivity on slayer, which is an important inflammation drug, but they have at least at least a dozen drugs that could be 5 billion. And that's why I think J&J plus the shockwave, David, and Abi Ahmed, those are good deals. So people are excited about J&J and they're thinking it's been de-risk because perhaps they should win, get the pre-packaged punishment, get settled off, that's been the accident. That vote is that we're not going to know. I mean, Joe, Joseph's playing, we're not going to get the results. The 26, but it is near term. And so suddenly people are saying, wait a second, if they get the pre-packaged, this stock is way undervalued. I agree with that. Yeah. Good company. Meantime, David, we haven't really gotten your take on some of the banks. A lot of discussion today about equity trading up three times the estimate across the major bank so far. Yeah, well, Goldman obviously responded well this week to the earnings that you guys covered on Monday morning as well. Listen, capital markets activity has been up. We saw it at JP Morgan even though the stock did not respond positively on that earnings day of Friday when we saw all the big banks actually down. Well, it's far the biggest of them. You know, we'll see what we get from here to sort of election day when it comes to M&A and that side of things. You know, I continue to hear that there's sort of a wait and see mode certainly for the bigger deals. And then back to the conversation that we were having with Aiman. Now, I don't know if JD Vance's perspective is shared by Trump. If Trump were to be victorious, we talked about this many times. There was a general belief that there would be less regulation in terms of overall, but even on antitrust, you would simply be a softer, gentler approach that we would allow for more deals. But if JD Vance is getting his ear and is sort of aligned with Lena Kam when it comes to big tech, then you may not see that level of activity that many are expecting. Morgan Stanley has said they already have three times the bake-offs that they had last year this time. Now, of course, someone down there and we're going to stand and come today. I'll go today. You can get the bake-offs, but what I hear consistently from those who are the practitioners, the bankers and lawyers is, I've got something, I've got something, I've got something, it died. And it died for any number of reasons. Sometimes it can be antitrust, but oftentimes it's also price. It's just there's so many different things figure into it, but certainly the larger deals that at least people have said, "I've got a pretty big one. They won't tell me what it is or even industry." And then they never make to the finish line. What is Barchese saying? He's one of many. He's got Barchese from one of many. It's a big joke because he's everything in the industry. He's certainly got a very good position. But there are a lot of other lawyers out there. I know you don't know any of them, but there are a lot of other ones. That was a comic relief from an otherwise very serious discussion you were bringing. Well, and one that the journal op-ed board writes about today to David's point, his White House would be an almost daily jump ball between free-market advisors and the new GOP status and protectionists. How is the market supposed to know what to say? It by the top of my club call. I wrote it up and we were discussing with Mad Money team. And I said, "You know what? The market may actually like a consistent but negative policy from Biden versus an inconsistent but positive policy from Trump, because how much the market hates uncertainty." Well, let's not forget the days where we were attuned to what was then called Twitter and what were the presidents' tweets about things that were right in our wheelhouse. And it was, if you're running an allocating capital, it can be a difficult environment sometimes, because you're hearing things every day. I'm looking at, by the way, taking a look, truth, social is doing pretty well. Trump media, DJT, hanging in there nicely, a bit under 40 bucks a share. But I assume he'll be using that platform again, Russians a long way away, hundreds to 100 days to go. But to communicate, and we'll be sitting here talking about things to Carl's point or the editorial page of the Wall Street Journal that could be one day, one thing, and the next day enough. But don't you think it's quizzical that you have a United Health reporting in line number that stocks up again for second day, and you have the drug companies that are being really under both presence. If Trump would be against the drug companies. And so it's Biden that brought in right there, actually, the IRA in terms of price. But no, they have to the middlemen. Really, price controls, insulin prices they keep bringing up. Why does the middlemen get away with it? I mean, the PBM's? Yes. I mean, wouldn't that be something that they very opaque business? Well, I just know that if you're a populist, you're not in favor of those companies. JD Vance being populist. He is. He wants to raise less corn and more health. And he wants to, is there also a possibility of devaluing the dollar? Well, he does not going to let exports, the worker be sacrificed upon cross of gold. That's what you're asking. But again, it's unclear what if any real influence it would have, right? True. Vice Presidents? Well, yeah, but he's great copy of that guy. Now, anybody who read Hillbilly Elgin knows that what it's about is steel company consolidation that sold out the workers. And then that brings in opioid addiction as there's no jobs. And I think that a prominent leftist gave me that book saying, here is the manifesto for the left. And it turns out to be the manifesto for the right. But then, again, strange bedfellows politics. It is truly an historic circular discussion about what we what we gave up for low prices in the 90s. This is the Walmart discussion. Yeah. You know, we let them make, we take 900,000 jobs that protect styles, which is what we had in 1980. We sacrifice those. We send them to Honduras. We send them all over Central America. And in return, we get cheaper clothes. So we sell out the worker who makes the textile worker. Well, we all benefit. So 900,000. Just on the backs of a certain part of the country. Exactly. And it's always been a difficult trade off. I know that as someone I fought against JP Stevens, because they, and, you know, felt that they were that was a great textile company and the strikers put them out of business, basically. But you know, you had this debate in the 70s and 80s, which is that do we sacrifice the workers and to give 300 million people cheaper clothes and the left endorsed the cheaper clothes. All right. Guys, before we wrap up, just to come back to my wheelhouse, did notice shares of Warner Brothers discovery are up about 2.6 percent this morning. This is a reporting variety about potentially as much as a thousand layoffs at the company. The NBA contract also out there still and see what finally happens in terms of they have the right to match. Of course, does Warner Brothers. My expectation is they will match, but the question is whether the NBA will truly see it as a match of what is Amazon's current bid on the table, or will it be deemed perhaps not a match? Because even though it is the same on economics, it's not a true streaming platform, given they would both air it on max and TNT. And then what do you get? Litigation perhaps would follow. We're going to follow that, of course, as many others will as well, but that's coming to fruition quite soon. And like a number of other companies with highly leveraged balance sheets, it's just been a beneficiary a bit lately of lower rates. So what do you think in terms of the prospects that if you're at home and you see this and you say, you know what, I really like the stock of $8 I should go buy. Isn't this one of those where we should wait and see rather than just go buy? I leave those kinds of decisions to you. I'm not just saying. All right, let me say, would you agree this is an influx situation? Oh, always. That's always. I rest my case. It continues to be. Do you know I was doing William Jennings brian when you didn't seem to realize that? No, I did. Of course, of gold speech. I'm not up on my cost of gold speech, with farmers that would grass grow in the streets of the city. I'll tell you one thing, guys. I got to start reading them and make them. Comcast flirting with 40 for the first time since April. I don't know if you saw this New York Fed survey looking at the percentage of people who were planning to move in 12 months. In January, it was 13. It's 18 now, as he got mortgage rates back to six, eight. So household creation could do wonders for streamers. You can't help. Well, and for cable companies that that conceivably hooked people up. That said, Jim, you know, the the proliferation of of other opportunities to get broadband, whether it's fixed wireless, which is right. T-Mobile, aggressively advertising it. T-Mobile's right now. Horizon. And then as I pointed out, what Starlink may be in a number of years, once they get Starship launching. 28,000 satellites. Hundreds of satellites each time for its new constellation. You just have to wonder how much competition will continue to be out there, even if people start to move again. I know my trainer was chiding me for buying the package, informing me that, what am I doing, paying the full boat? And I said, like, I work for Comcast, he said, well, what does that happen? What does that happen? Do it, you know, she needs analysis. As we go to break Dows Up 40 here, S&P 5616. Watch bonds today. It'll be interesting with the 20 year no-duction on deck and beige book at 2 p.m. Eastern time. Dow all-time high, NASDAQ two week low. Stay with us. The obesity drug wars continue. Roast with some positive data on a very early stage trial for its latest obesity drug candidate, something that had bought via acquisition last year, putting some pressure on Lillian Novo today. When I was there when they made that acquisition call, and I have to tell you, this is very early. This happens, continues to happen. You buy Lillian this week. This is just, if you want to buy Roast, you understand, they announced this on my show in January, so you're kind of getting old news. Good for you. We'll get stopped training with Jim in a minute. Dow's up 80. Let's get to Jim and stop trading. Second day, this swab is taking on the chin. People feel that they're outsourcing money, that they're not making enough money on. They have, that they're not growing like they should. At a certain point, you probably want to step in. It was not great, but it certainly wasn't hurting down more than 10%. It's a good company, and I just think people just decided, you know what, just throw that maiden in the volcano, go buy the others. We talked about the print yesterday. Today, TD Cowan cuts to hold. Yeah, it was really pretty brutal, and there'll be a level where you want to be in it, but they made the number by expense control. They did not make it by growth, and people want growth. You want to tout the club meeting really quick? Yes. At 12 o'clock, we're going to say what really is a Trump stock and what isn't. I think that there's a lot of misinformation, and I'm going to try to go over the portfolio to really explain it to people. And a lot of it is contrary to what's going on right now, and therefore there is opportunity. And then tonight, tonight we have first horizon, which is probably the most neutral to banks when it turns into talking about where things are good, where David Memphis real estate Brian told me. Time to swap out of Nashville and into Memphis. You see, a person who gives you the best look about what small, medium size business is really doing, and everyone feels that's where you have to be. So let's hear from the man. That's good. We did Nashville City of Success last year. There you are, I was begging you, but give me a name because I miss Nashville. So you've been to Memphis. I said, I haven't. I said, well, you know, you ought to check out Memphis. I mean, he's a he's a jocular guy in the guise of really being a very serious back. Jim, we'll see you tonight. Important day. Mad money. Of course, 6 p.m. Eastern time. When we come back and you are Denny with his take on this market rotation with the Dow of 100. You've been listening to the opening bell on CNBC's Squawk on the street. All opinions expressed by the Squawk on the street participants are solely their opinions and do not reflect the opinions of CNBC, NBC Universal, or their parent company, or affiliates, and may have been previously disseminated by them on television, radio, internet, or another medium. You should not treat any opinion expressed on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of an opinion. Such opinions are based upon information, Squawk on the street participants consider reliable, but neither CNBC nor its affiliates and/or subsidiaries warrant its completeness or accuracy and it should not be relied upon as such. To view the full Squawk on the street disclaimer, please visit cnbc.com/squawk on the street disclaimer. Before they were Team USA, they were kids, trading recess for reps and summer vacations for travel tournaments, all for one chance at gold. Stream the Olympic Games with fast Wi-Fi wherever you go on XFINITY mobile. Get the fastest connection to Paris with XFINITY, proud partner of Team USA. Now through September 21st, XFINITY internet customers can buy one unlimited line and get one free for a year. Learn more at XFINITY.com/TeamUSA. Restrictions apply XFINITY internet service and two known limited lines required. Reduce speeds at the 30 gigabytes of usage per line. Data thresholds may vary. [BLANK_AUDIO]
Carl Quintanilla, Jim Cramer and David Faber explored what investors should make of the market rotation that has fueled a rally in small caps: The Russell 2000 up double-digits month-to-date. The anchors also discussed the chip sector tumbling in Wednesday's session -- and where the White House, China and former President Trump fit into the picture. Also in focus: Johnson and Johnson leads the earnings parade, Fed Governor Waller on rate cuts, reports of new layoffs at Warner Bros. Discovery, Roche’s obesity drug trial weighs on shares of Eli Lilly and Novo Nordisk.
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