Squawk on the Street

Squawk on the Street 8/2/24

The opening hour of CNBC’s "Squawk on the Street" with Carl Quintanilla, Jim Cramer and David Faber is broadcast each weekday from the floor of the New York Stock Exchange, on site at the opening bell with the up-to-the-minute news investors need to know and interviews with the most influential CEOs and greatest market minds. Squawk on the Street Disclaimer

Duration:: 51m
Broadcast on:: 02 Aug 2024
Audio Format:: mp3

Squawk on the Street Disclaimer

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Don't miss a minute of the action. Good Friday morning. Welcome to Squawk on the Street. I'm Carl Kingston here with Jim Kramer, David Faber, at Post-9 of the New York Stock Exchange. Futures are sharply red, as this growth scare picks up some steam, and July jobs miss 114,000 smallest growth. In almost four years, a yields plummet to the lowest since December. A roadmap begins with mega-cap tech, though, and this big stock sell-off. Apple, seeing a continued slowdown in China, Amazon margins narrowing, while announcing plans to ratchet up AI spend. We'll also keep an eye on Big Oil. Of course, you've got those tensions in the mid-east. Exxon banked one of its highest-ever profits for the second quarter. rival chevrons earnings did miss expectations. We're also going to watch chip stocks, of course, Nvidia certainly, but what about Intel? Those shares are going to be down sharply on news of a $10 billion cost-cutting plan. The company is going to slash as many as 15,000 jobs. Let's get right to the sell-off. The S&P and Aztec on pace for their third straight week of losses. As we digest those mega-cap tech results and the jobs number today, hiring did slow sharply in July. Jim, yesterday you said you thought the Fed probably should have moved in July, and now the market's looking at 50 in September. Thank you, Carl. Yeah, I just think that they misjudged the month. The Fed was a very weak month, not a lot of jobs. There were a lot of things that happened in the economy, and also things that happened in the real world in terms of what happened to a former President Trump, and I think people were transfixed. What? There's music still going. I don't know why it's bothering me. I don't know. But to get to maybe it's like that bear. Thank you. Look, when I was recently in... Can we just talk about what's going on here? Which is that everybody says the Fed is behind the curve, and that this jobs report seems to be confirming at least the fears that happened yesterday, that 17 years ago you started to rant that about the Fed. I'm not sure you feel that way right now. No, good job. I think that they missed. There wasn't enough yesterday that everybody was saying that the IMS was bad, rates need to be lower, and suddenly you watched all the mega-cap tech get hit, and by the way... Well, we got to talk about that, because it's not correct. And then today you've got earnings, obviously, from Apple, which were not bad. Amazon perhaps confirming some fears about the consumer. And then the jobs numbers. So you put it all in the mix, and we look at a tenure of $3.85, and we're going to head lower again on many of those big stocks that take the market much lower. Yeah, but we have to distinguish. I think that if we just say mega-cap, we got to get away from that. Okay. We have companies that are building a huge amount and spending a lot of huge amount and giving money to a video. And then we have copies that I've said were free riders. And Apple is the ultimate free rider, which is why I would buy Apple if it were down today. That was a very bullish call. Tim Cook's probably the most, I'd say least concerned person about the economy, most excited person about the rollout. And I think that we lumped in, Apple was dead. But people, it's the future, stupid. Apple's good. Well, this gets to the conversation we've been having for weeks, Jim. We've heard about concerns about the consumer from luxury, from airlines, from restaurants, from consumer products. But somehow we're going to believe that people are going to go out and spend $1,000 on a phone. Well, Brian Eslowski, the terrific CFO of Amazon confirmed that it's the high end that they're spending. They said electronics is probably the most important buy, which I thought was incredibly significant. We can go in about Amazon web services being great, by the way. We can talk about the fact that there was some days that there wasn't a lot of buying. The Olympics have played a role, the attempted assassination played a role. But I will point out that it seems like the end of the world, days like today. Is this why you tweeted the picture of the sunrise? Yeah, the sun came up this morning. It always does, thankfully. Well, okay, so maybe you ought to get more with the program. What is the program, Jim? The program is to not have a day where the stocks go down. Okay, the program is that you buy Amazon at 165. You just buy it. I mean, do you think it's bad? I mean, if you read the call, Jassy's got it under control. I think that you've got three divisions. You have advertising, which is important. You have their retail business, which is obviously important. And then you have the best business, which is Amazon Web Services. And it was even better than I said. It was. It was up 19%. And you know, the market was created accelerated, 35% gross margins. Again, people applauding Amazon Web Services. So you want to sell it? It was at $200. The concern, once again, is playing into the overall concern in the market, which is about the consumer and maybe not the high end, but the mid and low end, the trade down. Oh my, what happens if the Fed cuts? Then what do we do? We say, oh my God, we consume a lot. Consumers are being careful on price. Our North American unit growth is meaningfully outpacing our sales growth as continued work of selection, low prices and deliveries resonating. Well, no prices. That doesn't sound bad. What that means is they're wiping out CVS and they're wiping out Walgreens the same day. Who knows how many stores those companies have to close? People are not going to the drug store. They're doing same day Amazon. It's happening. Okay. Another thing that actually is hurting Amazon seems to be the fact that they decided to build a lot of satellites. Project Cooper. Satellite seemed, I didn't really understand it. And that, that didn't mean to be that to Musk. We should leave it to Musk. It did seem to come in to at least some gross marketing. I'm going to mention that because that's the one part of the, that's the wrinkle coral that I, I didn't see coming. What I did see coming was that Jensen Wong can't make all the, the chips that they want. So what did they do? They built their own. And I think that makes sense. If someone says they're competing against Nvidia, that's a major mistake. But look, I mean, it's a doubt day. I'm not saying come to the rent. No one's going to come to the rescue because the Fed didn't move yesterday. But I have to tell you that if the Fed moved with in the next seven weeks, you're going to say, well, why did I sell Amazon at 160? What was, what was wrong? Was it quite Kuiper? I thought that was like Schnapps Kuiper. Yeah, I'm not. Isn't that Schnapps? Cooper Kuiper. It's like that comes in a lot of flavors. Oh, he'll say to me, we stay focused. Like I'm not focused. I'm here. Am I supposed to be here? I wasn't counting on the Schnapps reference at 906. I mean, do they know that out there? I don't know what they know about Schnapps. Not what they know. They know how to make money. And if you want to panic, I'd just say, listen to Jassy. You think he's panicked? And you're just really not panicked? Timothy Donald Cook. I mean, we're talk, I talked yesterday with him. And what did we talk about? About perhaps an ad cheer for Apple Plus? Because you know what? Apple Plus is doing incredibly well. I'm not going to reveal who lives in presumed innocent. But it did come up on my call. I see Amazon product. You did talk to Cook. I think we have some quotes floated about. I guess the AI and CAP expense, which we'll show viewers, the general take, in fact, Tony Saginake a moment ago, saying relative to their peers, they're cash flow superior because their spend is low. Their cash flow is happening at one point in the call. Look at my history, it's an amazing CFO. He said, I'm glad you noticed. Our cash flow is gigantic. Big step up in cash flow. But I know, David, it's a really bad day. And I'm supposed to just say, you know what? It's only a matter of time before day two. I mean, I got to tell you, China, the biggest three cities had an increase in share. And if you backed out the actual dollar strength, you would find out that they gained. I'm just so upset when we're having a down day because of macro concerns for any number of reasons. You get so angry about it that it's impacting these stocks. Yeah, they're going to go down, you know why? Because they're the biggest stocks they're the most owned and they're going to get sold. And people are buying some things like Philip Morris. They should not do that. The average viewer is not short and gloating. The average viewer saying, you mean to tell me that Apple is as bad as Amazon? Well, you please discern. They went discerning. And I'm going to give you some discerning chief intel. What did I tell you? You said it was safe and intelligent. I never said it was safe. You were wrong. I never said it until it was safe. Never. Not once. John book. You're wrong. John book? No. Witness. Still great. Very good. That's your part of the world. I knew the whole safe thing. You got to come up with a new one. You want me to go with that? It's a safe? You want to do that? By the way, anything above 24% decline today would be the worst intraday performance for itself since 2000, quarter century. Okay, Tony, there was a moment in some research. Stacey you asked, it was not on the call list. It comes on air and he's really fabulous. He's a chip analyst. Excellent. He mentioned the two words that you know I've been saying for a long time. What are they? Going and concerned. Yeah, B of A cuts to underweight. The title of that report is no quick or easy fix. They got a 29, I think, Jim. Yeah, I just don't even know how Del can stay with him, how age peaking stay with him. There was a moment in the call. We were like slagging Nvidia by saying that they have this Galilee three. I mean, no one's using Galilee three. They sold half a billion worth of Galilee three. Well, Nvidia, did that today? I know. Okay, what I think is really dangerous here is that they took the money from the government, okay, and they're building these foundries, same time, of course, they're moving. Or taking Oregon founder, taking it to Ireland. But they did the moving business to Ireland. But I have to tell you that this was a conference called where Gell Singer's calm nature infuriatedly, infuriated, because this company is on the verge. Well, what? Now, okay. Oh, cool. They've been right the whole damn time. I told you they cut their dividend when everyone said they're going to raise their dividend. I'm not arguing that you haven't been right on. Why are you so angry? I'm not arguing about that at all. You've been right about worrying about this company. But saying that there's a going concern. No, no, I'm shaking. They are. Now, the way. Okay. Will you let me finish this for a second? Of course, I'll let you finish. He may have been calm on the call, but they have now cut the dividend. They're cutting enormous amount of employees. They're cutting catbacks. You would seem to be saying it's all too little too late because the CPU business is dropping at a rapid rate. You can only buy so much. And obviously the buyers all want AI chips. But a lot of people are saying that Dell and HP can't stay with them. Yes, they're second. No, David, on the going turn I was quoting Stacey Raskin. I would not have used that term. He says, you know, the circumstances we believe we would now be having going concern conversations. That's all I'm saying. Me, no. I think that what they have to have is a game plan to deal with all the fans with. They have the chips money. Well, they also have Apollo that helped finance. They have Brookfield as another. They're significant owners of these fabs. But it's years away. And so they've got to somehow bridge this long gap to get to this promised land of fabs that are going to be producing chips that are what the market wants. And that's obviously a key question. You can explain about 48 billion in debt. They've got a game plan. But the game plan to me does not have what people really want, which is AI. They're not there. And this is part of what they don't? By the way, the target on B of A is 23. They do have a line in here. What might go right? And that is Jim. Stronger PC cycle driven by AI. Even a fiercer geopolitical tension with China because Intel is largely US manufacturing based relative to a lot of peers. Well, I think that those macro trends are with them. Against them is AMD. I think Lisa Sue can make all the chips that we need in the world. And yesterday Renee Haas was one. Now I know his stock is down badly. But it's going to be when I listen to that call, I don't buy the go and get certain. But you know, I think it's called more. But when you listen to that call, all you think of Carl is yesterday Renee Haas in great shape. The day before Lisa Sue in great shape. Doing really well. Well, this company may be carrying right now. Carrying. Not carrying R-R-I-O-N. Yes. Yes, rotting meat. Yes, exactly rotting meat. I didn't mention maggot. I didn't. That's not a great place to be. And they're not a great place. No, it's not. And it's been many years since we've talked about this management of poor decisions in terms of, and then execution as well. Well, you know, I thought I asked Secretary Ramondo. Is it safe to do business with Intel now? I think Secretary of Commerce. I think everyone felt it was safe. But then I'm listening to the call and I'm thinking, well, you know, there's a moment. This is the moment where they don't have the business. And the moment where AMD is calling Michael Dell, Michael Dell's calling AMD and R-K. Okay, he's calling Lisa Sue. H-P-N-H-P. Well, after a week where we got armed guidance and Western dig guidance and now Intel and now microchip, you're still bullish on the space at large? No, I'm bullish on companies that really have, we're going to the GPU or helping Nvidia. So it's a narrower set of bullishness. Yeah, look, I mean, when the conference call for Amazon, they, you know, they know, they absolutely know that they have to spend money on AI. To the point where they mentioned that Nvidia sold out. There's sold out for a long time. There's sold out probably through 2025. Yeah, listen, the spending plans that we've heard that have been reaffirmed from the likes of Microsoft or Meta or Alphabet or Amazon have done nothing to dissuade anyone from thinking Nvidia is going to still be the key beneficiary. Right, but you take me. Now we have this big rotation that's going on in the marketplace. There's concern ultimately about the consumer, whether the Fed is now behind the curve. But none of that seems to go to the heart of the matter, which is Nvidia is going to be potentially sold out for some time to come. Yes, I mean, you've listened to Amazon. Of course, they have to build their own, but that's the, that's a defensive move because they can't get enough building their own chips. Right, but designing their own chips. But I mean, you'll get Amazon building. Yes, here's the way I look at Amazon. I think it's important because it's stuck down so bad today. It would be a buyer. Amazon knows that there's a lot of business. So they have to buy a lot of planes. They have to put up hangers. Now you don't, when you're buying a lot of planes, you're not putting people in the planes. So they buy the planes first, cost a lot of money. And then you have to bet that they're right. I want to bet that Jassy's right. Or you could actually use a different analysis. They are buying a Stradivarius. And you can't just learn like a violin, a Stradivarius. You've got to learn it's a little harder to learn. It's a little harder to teach, inferential. So I'm just using, try to find analogies so people understand that it's taking some time. They can't just turn a switch. And that's making people very upset. And the fact that they mentioned the Olympics, I mean, it feels like, are you kidding? I mean, but the country is like in the 2012 mode. I mean, they're watching the Olympics. They're not buying as much. And what they are. Because they're watching the Olympics? Damn, not me. Yeah, I know that was weird. Damn. Jeffries does have a note today saying that clients are calling in asking about potential delays in Blackwell. And then we did have the report yesterday about DOJ reaching out to rivals of NVIDIA who have been complaining. Well, it's slower. It's slow, but they never really said it was going to ship in volume. So people who think it was going to ship in volume, they should go back over. They should talk to Jensen. He never said it's going to ship in volume right now. Never. Right. Right. There is still this question about return on invested capital. There will be. By the way, the answer is uniformly from the hyperscalers has been yes. And Jassy said it's the same thing. Well, how about Zuckerberg? Remember? Yeah. I mean, talking about generative AI, Jassy said it's going to get big fast and it's largely all going to be built from the get-go in the cloud, which as you know, allows the opportunity for those businesses to continue to grow. Yeah, the cloud is growing in a level. You've heard no let-up whatsoever. No, except for the cloud. That's what we should be focused on, but we're all focused on getting into it. Those who are making the capital allocation decision. Can I just say one thing? You can say many things. I'm sorry if you were mad at me. I'm not. I apologize. I'm not mad at you. I got a little excited because it's a big day. But I regret that I did. What did you do? Do you know? I yelled at you. It was actually somebody on Twitter. Somebody on Twitter had from the office, Michael Love. I still love it. Scott's yelling and screaming at everybody. Calm down. Calm down. Everybody be calm. I apologize to David. And if I was out of line, you'd cry. I apologize. We'll take a quick break as we continue to watch this global sell-off. We'll talk about some of the market action overnight in Japan. Now, 15% off of the July highs. We'll get to the oil, snap, booking, draft kings. Do we return? 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Earning your degree online doesn't mean you have to go about it alone. At Capelli University, we're here to support you when you're ready. From enrollment counselors who get to know you and your goals. To academic coaches who can help you form a plan to stay on track. We care about your success. And are dedicated to helping you pursue your goals. Going back to school is a big step. But having supported every step of your academic journey can make a big difference. Imagine your future differently at Capella.edu. On top of all the news today, Ford's got sales figures out. Let's get to fill the boat. Morning fill. Hey, Carl, in the month of July, Ford sales essentially flat down 0.2% compared to July of last year. And we continue to see the trends that we've seen for some time, not just with Ford, but all of the legacy automakers, internal combustion engine vehicle sales down 5% in July compared to July of last year. Where is the growth happening at Ford as well as with other automakers? But you really see it at Ford EVs and hybrids EVs up 31.2% year over year and hybrid sales. Look, they're killing it when it comes to hybrids, especially the Maverick pickup truck up 47% year over year. Ford sales overall down 0.2% essentially a flat month compared to July of last year. Guys, we'll send it back to you. Okay, we'll see in a bit. When we come back, Kramer is mad. Dash, we'll count down to the opening bell. Take another look at futures off these session lows. But the VIX still at 21, 2s, 10s down to 11 basis points. Stay with us. Support for this program is provided by Chevron. Demand for energy is projected to continue rising in the future. To keep up, Chevron is increasing their US 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 in progress. Learn more at chevron.com/meetingdemand. Earning your degree online doesn't mean you have to go about it alone. At Capella University, we're here to support you when you're ready. From enrollment counselors who get to know you and your goals, to academic coaches who can help you form a plan to stay on track, we care about your success and are dedicated to helping you pursue your goals. Going back to school is a big step, but having support at every step of your academic journey can make a big difference. Imagine your future differently at Capella.edu. All right, we've got so many earnings moves to cover. One of them is SNAP, so we'll get to that in the mad dash. We'll have an opening bell about five minutes from now. Of course, we are looking for a significantly down open continued fears about growth and a jobs report that didn't help certainly alleviate any of those fears. As for SNAP, what's going on here? Okay, there I think it's just a heightened irrelevance. I think the brand advertising is going away because user growth is flat. I think this is one of those moments where you take a look and go back over Zuckerberg's conference, going to talk about how it's just so easy for the advertisers to target direct people. These do not have the people. And by the way, Zuckerberg said, listen, we have young people. They have like 18 to 26, but it's hard to get. But this is a shared donator. And it was a conference call that was not as bad as Intel's, but pretty bad. And a lot of people are trying to wonder like existential there. So this is versus expectations. I'm just reading quick review here. I don't know. Direct response ads up 16% year over year. And the more branded. Brand ads declined on weak demand and retail. Very bad. Tech entertainment. That's bad. One of the things that's happening is we don't need all the players. So we do need YouTube. Okay. Amazon. Zuckerberg actually was just killing it in that conference call. So then maybe we only need three. I won Pinterest to Wings. I like the site. Very much. I like Reddit. I use that. But and I think those can do okay. But David, if you're an advertiser, you're just saying, well, just give me the big three. Okay. Just give me ABC, CBS and NBC. It's like pre Fox. We're trying to figure out who's Fox. But that's who we are. We have three channels. And those are the channels. And who cares? You too. Amazon. And most importantly, Zuckerberg, who just took. What did he do with that? With Jensen. Oh my God. I think he got him. I think Jensen. I think you have the most chips to get to. Zuckerberg. Yeah, I really do. I think. Yes, I do. Okay. Yeah. And those chips. So, you know, obviously there is an ROI. If you've got a game plan. I'm glad to see AMD is up, Carl. Because AMD is the true winner in what I regard as the dissolution of Intel. I'll tell you what was remarkable this week, Jim. Was the comments. Google. The risk of under-investing is dramatically higher than over-investing Zuckerberg. I'd rather risk building out before it's needed rather than try to ramp up when it's too late. Look, I think Amazon is not years away. I think they're months away. Well, meta down 12. I mean, look, there's tremendous panic today. And it is Friday. And people are worried about what could happen in the Middle East. And I think that there's a sense that people say what do we do with the Russell that that went up so much. People are trying to get out of the Russell trade very hard to get out of a small cap when you decide to turn. So, people are taking the cue from companies that are really actually doing okay. Amazon's doing okay. Apple doing great. And meta doing great. You know what kind of got lost this week was the B.O.J. hiking. The carry trade impact. This is the worst two days for the Nikkei in, well, since 11. Take a look at the correlation between the cue, cue, cues and the Nikkei. I got up at three o'clock because the Nikkei. I got up at three o'clock because the Nikkei. It gets your attention. I got to put those two together. Down five percent. But our market was going down. Then as that was going down about a percent and a half. As people like wake up and then they start banging down the outside. But this Nikkei, no, that's like what happened. It kind of feels like 89 over there. Well, of course, the Nikkei did come a long way. Yeah, but 89. They kind of, you know, this is what stalled him in 89. You could have gone long. Our Dow in short the Nikkei. Yes, it was a very, very, very long bear market. And there were kings. I do. The Enigma of Japanese power. Do you remember that fun wolf record? I remember it very well. I was covering banking in the late '80s. And the Japanese banks were huge players in our market. Sumitomo. Tokuji. Mitsubishi. Long-term credit bank. How about when they bought Rockefeller Center? Yeah. Wasn't that the apex? It was. Movies. They were all of cars. Everything I remember hearing Andy Grove talk about how the late CEO of Intel saying, listen, we got to play a little defense here. But he got to remove the company to CPUs and away from memory, which was, of course -- 1985, we got out of memory. Yeah. That was smart. And both Andy Grove and, of course, Gordon Moore realized that memory was best. They went into the mic for us. So it was a really good move. I did not like the fact that Pat Gelsinger said, look, that's kind of what we're doing now because they had a very good balance sheet and they had a plan. And I look, I don't mind being negative about Intel because I wanted people to get out and they got out. And that's -- half my job is trying to get people out and half my job is trying to get people in. And I succeeded on that. When I got some others, obviously, I blew the calls. But I wanted people out of Intel in the worst way. And a lot of people got out of it. Yeah, we got to go back more, too. Let's show a longer-term chart on Intel. Yeah, let's do that. Because it is -- listen, it's an interesting story. Not the kind of story most people want to hear or tell. Even further. Go back. Twenty-two. I mean, come on. Yeah. There we go. Do you know that you're going to break even on mobile-wise? I'm not kidding. [ Cheers and applause ] Let's get the opening bell here in the CNBC real-time exchange. With a big board, it's Seaport Entertainment Group celebrating its listing and separation from Howard Hughes' holdings. A big New York City story. A downtown gets developed at the Nasdaq. It's New York City Dance Company. Battery dance. We'll look for some opening levels here, Jim. And watch the breast go in. To the men who do some buying. I'm going to say yes. I know. It's so early. It's really quarter of three that tells the tape. Well, two forty-five on Friday's has been the deciding point about what happens. If the market's going down at two forty-five, look out. If it's turning, we're going to be fine. But that's the fulcrum moment. I don't want to do anything for two forty-five. There's a look at the Dow down about a percent. We'll keep our eye on yields as we said. Got to three seven nine on the ten year. I'm hoping for yield myself. What stocks have a good yield? It's time to do that. And of course it is. Yeah. Okay. Well, somebody's happy. I look at a company like Sempera, which does so well with natural gain. I'm not going to let you count the Comcast mentioning utilities. That was supposed to be funny. It's super funny. You left me on the inside? I'm always laughing on the inside. Yeah, I mean, those, listen, anybody that relies on interest rates or Comcast shares are up. That's potentially helpful. I want yield. What do you remember that? The two year. The two year paper, yes, it was like the great. It was like buying a video about five thousand percent. Apple is bucking the trend for the mega-cap companies. Thank you. It is up on... Yeah. What was confident? What were strong numbers from the company? By the way, you know what he said to me? What? Vision Pro in its infancy started doing incredible a lot of people writing for Vision Pro. And I said to Tim, a lot of people make fun of me. But he said they should. It's going to be big. Really? Yeah. Okay. Okay. I mean, it's okay. Okay. He's a believer. Now, Apple's down. You killed Apple. Now it's up. I didn't kill Apple. I didn't kill Apple. Amazon, however, is down almost cutting in half the gains that it had for the year. And I'm like, "What the hell is that?" Well, that's where they're rotating, right? By the way, if you really get concerned about a consumer, the last thing they're going to stop paying is their cell phone bill. And obviously, if you want to sell, if you want to get lines in your team mobile, you want to use market share, Carl, you're going to call Timothy Donald Cook today and say, "You know what? What do you got for me?" And he's not going to say, "I've got nothing for you." Because he is not Jeff Brooks. He is not Jeff Brooks. Did you have higher hopes for iPhone down one? No. I thought that iPhone was surprising that they had that they gained share in China and the three biggest urban markets went for them. I'm focusing Philippines. I'm focusing in Indonesia. I'm focusing on these big India. These big markets are really good. I'm focusing service revenue, which is extraordinary. All being done with that. Yeah, service is up 14. All being done without Apple intelligence, which I think is going to be amazing. I really am excited about Apple right here. And I just think that Tim Quoke was about as calm and as excited in terms of his will. But not, you know, he just seemed so confident. And Luca, you come nice to me. David, the cash generation of this company may be the single greatest cash generation of any company I've ever seen. Of any company in history of capitalism. Period. You're right. Two numbers. At least cheers from Apple. Yeah. Just the actual number. You can't do that. You can't compete. The numbers are, you can't even imagine it. They don't give you the user number, but I got to tell you. It is very clear that there's only going to be one phone in the world. I mean, this thing I remember would sit in Huawei, Samsung. Go pound sand. Go pound. Where are you going? Big oil. Let's talk oil for a moment. Let's talk about Exxon. Let's talk about Chevron, both of which reported numbers. By the way, guys, also, when it comes to the overall market, there's still a lot of concern about heightened tensions in the Middle East, Iran responding to Israel and what they believe was, even though Israel is not taking any responsibility for Hamas's political leader. Now, you're being assassinated in basically the revolutionary guard shelters holding, you know, palaces or whatever you want to call it, all of which leads to more concern as we head into a weekend of what the response, if there is one may be. Exxon had a number that is being rewarded in the stock market. By the way, when you take a look at Exxon versus Chevron now, there was a time when the market caps of these two companies were fairly close, no longer. Exxon's market value is $532 billion, and Chevron is $275 billion. You know, I know you've favored Chevron until my hero, Sheffield, got bored. I am here. And that was such a great deal. Sheffield, there's no plaque, there's no monument, there's nothing for him. Exxon's CEO was a guest on Squawkbox earlier this morning, and Darren Woods was talking about actually the benefits of the pioneer deal. I believe we may have this sound. I don't want to promise it, but I think we can take a listen to what he talked about in terms of synergies. As we continue to leverage the opportunities and the synergies between the two companies that will have more productive capital spend, so my expectations will continue to see that volume growth. Right now, based on the first two months into the merger, expect to end the year at about 1.2 million barrels a day in the Permian operation, but obviously we're really early into this thing. I've got very high expectations for that organization and what they can deliver. Of course, that goes back to a larger point as well. The U.S. is producing more oil than ever. Yeah, Mike's saying that the Permian could peak next year, but it might work like worth. I really like Exxon because Pioneer was the most, they didn't have the money to handle all the oil that they had to bring in. Chevron? Chevron? Yeah. And you heard it. Becky did ask him, "Well, why not increase your earnings?" But he was reluctant at that point, at least to promise that, but certainly speaking possibly. But what you feeling on the deal? By the way, a deal that they got done in six months. In contrast, Chevron is going to be waiting for that has to deal. If they even get it closed for a very long time, we reported yesterday that Chevron said it would not be until May that the arbitration takes place. And remember, they're arbitrating against Exxon, the potential partner of Hess in Guyana, which of course is also an incredibly important property for Exxon, for Hess, getting bought by Chevron. And it's unclear, then it will be months until the arbitration, and you still got to get the antitrust. It just can go up for everything. Yeah, we see. Great job on Pioneer. It is. It's not done fast. Absolutely a terrific thing. And one of the things, the victory rat left at Scott Sheffield on my show, and I really respect him, basically just said, "Look, we did the best for shareholders. We got a good deal, but I love what Exxon did." And then David, remember he got in trouble for some ridiculous-- Yeah, and now he concerns on the board. That was so on the board. Yeah, that may have not been properly upset about it. That's why I'm upset about it. I'm upset that it's not fair. But what about Chevron is the question. Again, we can take a listen. I mean, you want to take a listen to Mike work talking about the Hess deal and how they're viewing it right now? I thought we had that. Take a listen. We have indicated that there's a closing condition in the agreement that relates to this, and if that were to be the outcome and the arbitration, the transaction wouldn't necessarily close. We think that's a low likelihood. And underneath the Hess transaction, as I said, we've got strong organic growth underway across a number of our businesses, free cash flow growing very strongly with a strong balance sheet and record distributions to shareholders happening. And so that's all the base case. And as I said, the Hess transaction makes it even stronger. So we feel confident in the outcome on the arbitration, but our hand is very strong in the base case as well. All right. You heard from Mike work. Just wanted to kind of cover those two first-cups. No, that's about 4% yield. I think Mike does a really good job, but Mike is pumping a lot from the Perman. He's got a big Gulf of Mexico hit that's going to really next week. So I think that if you wanted to know which one I would buy right now, but just because of the yield, I would buy Chevron. Okay. Also moving their headquarters out of California. Yes. And as you said on Squawk today, Jim, we will not be the last. No, and that's something, because this is standard oil of california. Yeah. It's under the airport, all the severance stuff. It was okay. I know. One of the great companies in Rockefeller, how many people are rolling over in the grave today? We've got Rockefeller rolling over his grave. We've got Grove rolling over his grave. Who else is rolling over the grave? I'm trying to think about it. I'll tell you who's not rolling over his grave because he's alive, but I bet you, you know, Bezos, because he's, I think he's saying, are you kidding me? The quarter was good. We're doing a lot of things right, but let them sell. Go ahead. Let them sell. That's how I feel about rolling over it all. No, he's, I'm saying, he's saying, he's saying, he's just, he has this so much more jack than ever. You see those guys? That guy's arms. That's what he's only made. But he's gone. He's gone. He's gone. Carl, this is the one, if you want to know which one I would buy, I buy Amazon because they have it very much under control and people are acting like they don't. Meanwhile, Pepper's Proctor, Kimberly, Abbott Labs, these are amazing, these are recession stuff. Yes. By the way, the target trims on Amazon are not that big. No, no, no. They're down 20 bucks. Piper goes down five bucks, right, so they've been surgical. Although on the other hand, Jim, the line about the consumer has some wondering what Walmart's going to say in a couple of weeks, what Kroger and Target will say. I think that they can say that it's delayed, but it'll be good. There's a pause in buying. I come back to the dead. Not because of the Olympics. No, no. I mean, I come back and say, look, you know, there's a moment of weakness, but people come back and buy as the holiday season, and you're going to regret that you sold Amazon. Like, are people selling Amazon to buy Clorox, which is up eight? Because I'm going to tell you, that's ill-advised. It's an ill-advised trade to buy Clorox and sell-in. You don't like ill? Well, I mean, no, I'd like that. And Linda Reynolds did a good job. I'm just saying I would not buy a package good company up eight. That makes sense. Investors, I mean, the rotation is into pharma. Merk has had a brutal week, by the way, after earnings and that call in particular where there was concern about sales of Gardasil, in China, in some ways. And obviously, Hugh Truda comes off-pat, and it's a number of years from now, but it's so important to them. But Merk shares are up 2.2 percent, a bit of relief there. And across the board, Pfizer, J&J, Bristol Myers, which did have a very strong response for earnings earlier this week. Well, you went the one that is ironic. The last week, at five o'clock, Abbott lost in case, a very cold NEC for a very serious illness that a planter said they caused. It was a $495 million loss by Abbott, and it's had the best week it's had in ages. Yeah. What does that tell you? People rotating furiously into recession stocks. I think that's all right. Are we really going to have a recession? No, we're not. David, people are doing stupid things. They have riot first amendment. You can do all the stupid things you want. Well, you say people. I mean, it's mostly... People need people. It's mostly algorithms and machines. Well, it is. You try to get out on small caps, it was easier to get in than to get out, but that's always the case. It's a Roach Motel now. The IWM, yeah. Yeah. I mean, as far as recession goes, Atlanta Fed's running 2.5 for the quarter, although DRW does point out the unemployment rate, Jim's 9/10 off the cycle low, and it typically doesn't stop there. No, it doesn't. Once you're up that much. I think that right now J-Pals looking at an Amazon, he's very sensitive to everything, and saying, "Wow, I got to read..." I don't think they get so granulars to read the quarter, but if you look at Amazon, you know, Amazon Costco and Walmart are where people shop in this country. So if you see a drop in those, that means not just substitution. It means people are hoarding, and they're not going to the store. I don't think that's the case. That's why I said Amazon at 163, 164, 165. You may buy a start there, and I think you may say, "You know what? I got in. I got in on a day when they had one day before." Speaking of all that, booking lows for the year, Glenfogle on Squawk said, "Yeah, there was some impact from lower airfares, but they didn't seem to rattled." No, they weren't. And yet, I felt at the same time that you mentioned Marriott. I mean, I think that there's a pause in travel, and travel had been the strongest part of the economy. And I'm concerned about the pause because I'm trying, as always, to figure out whether I'm Boeing. I didn't mean to call you Dave, but David. You're Dave to me. Yeah. Dave, I'm Dave. That's like a barbecue restaurant. But I do think that I'm worried about Boeing again, because they need the cash flow. No, you're right to point to the travel data. That's something that I have down here in my notes as well, from those who at least are wondering how quickly the consumer is slowing down. And of course, you know, there's that you slow down slowly, and then you slow down quickly, and are we in the quick part of slowing down? Well, that's kind of stuff here. Nobody said these people are bright. I'm just telling you what I'm repeating what they tell me. Guys, it is worth noting Apple shares are up nicely. Right. And the performance of that stock now for the year exceeds that of Amazon, and exceeds that of Microsoft. It's closing in on the performance of Alphabet. Obviously, Metashares are far above. Yeah, but didn't have a good quarter versus you guys. But Apple's quarter, as you said. On the other side, we've talked about it a lot, but it is a fascinating story. It's not a particularly positive one. Intel shares, you're talking about a company that has an $87 billion market value. By contrast, the company it used to crush repeatedly, AMD has a $220 billion market value. But at least if we can, I'd love needing to go back more than 20 years. I don't know if we have the ability to do that on Intel versus AMD. Would that be a teeny like Java 20 years? But it just, you know, there are losses. I mean, there are leads that are lost and never regained. RIM. Yeah. Research in motion. Yeah. It was the anniversary. Blackberry motion. Now that would be. Oh, okay. There's a, it's a diverge. It's called a diverge. Look at that. Wait. That's Lisa Sue comes in. Look what she does. Yeah. A brilliant chance. You're back in the day reports that would literally say AMD exists at the pleasure of Intel. Just so it doesn't get any trust. So they talked about any trust like, you got to keep them alive or somebody, you know, they'll bust up in. Who is it? Sanders. Who is the? Jerry Sanders. Jerry Sanders. Yeah. But look, Lisa comes in. Nice building. By the way, donates very strong. She gave a nice building. She's an easterner as opposed to one of these Silicon Valley, whatever. Wait, where is she from again? She's from Queens. What's for her? She's Queens. Yes. I think she's from 159th. Okay. My wife's from like 163. And I do think that when the book is written, what she did here versus what Gelsinger did is extraordinary. Gelsinger is the CEO of Intel because she is brilliant, but she doesn't carry herself like that. She and Daniel are two of the most, her husband, two of the most regular people in the world. I just really like them. You mentioned media and Comcast. By the way, Olympic viewership up 80% from Tokyo. Wow. Pretty amazing. We'll get track and field next week, basketball, and a lot more. In your NFL, we didn't mention the... Oh, the 7th. The overturned. Nice. The overturn of the... Yeah. Of the 4.7, 4.8 billion dollar judgement. Yeah. The Sunday ticket. There. And then DraftKings today, Jim. Although it's lower. Yeah. No, they're not great. But I'll point your attention to a company that no one's talking about when it comes to the consumer. That door-dash quarter. Tony Schoen. I mean, people are spending their darn full heads off if you listen to DoorDash. What do you hear that? Also some of the theater change, Jim, cinema with a decent quarter inside out, too, is helping out. Yeah. I'm not as negative as people. I wish the fed had moved, but obviously the tenure is telling that. But I just think the exaggeration of the decline in tech, they have to go listen to Mark Zuckerberg who had a very calm hand and listen to Apple, and you may say, "You know what? Maybe I shouldn't sell Megacap because it was really...those two were very good." cinema mark now with a almost 80% gain on the year. Really? Yes. As a member, when we were talking about existential threats to the movie business, or at least the distribution business... Yeah. Well, look. It's nice to see something very positive happening. Wow. Wow. That's like the inverse of Intel. Look at that. Yeah. Who would have thunked it? Who would have thunked it? By a movie theater change? I mean, I got to talk to you, Johnson. How's Disney doing today? Well Disney's done extremely well at the box office, as you know, with Inside Out 2, and then the Deadpool Wolverine team up. Yeah. Hey, by the way, David, here's an interesting one, Starbucks, which is up to it. Okay. What's going on there? Well, we continue to wonder whether things will be settled in a friendly way between their large shareholder, Elliot, known for its activism, although not oftentimes going to a proxy fight, by the way, but for its activism, or whether they will have to get a little nasty. I don't know the answer, Jim. Yeah. Well, that's one of the great... Carl, when we have these stories of all time, and these are great stories. It's Elliot versus Starbucks, or is it Elliot in... It's Elliot/everyone is what it is lately. Well, I think Constellation Brandt has a great relation with it. They're all frustrated. This talk doesn't go up. But remember, it's outfall. Really quick, Jim. Before we go B of A, down 3% plus, more discussion about Berkshire trimming. Yes. And then Morgan Stanley does get cut to underweight it wells. I thought that was... My travel trust zones, it's been an absolutely great story, and I just thought that was... I just thought that was just a careless down. By the way, 3.79 yield. That's what you're buying. I think it's worth mentioning that the banks are off a great deal. No, and then people worried about credit. If I were Jamie Diamond, I would have read a piece in the right post saying, "Hey, you've got city down over 6% right now, and across the board." How about the trashing? Do you think Charlie Sharp, you think Diamond's warnings about hurricanes might actually eventually come? Maybe Hurricane barrel. I don't know, that's one of those pieces that, yeah, I'm favoring Truman and Eisenhower and Lincoln. He comes out in favor of Lincoln. Well, by the way, you never want to get... Everyone gets... he's talking about his endless talk about that we may have a recession. Right. You're talking about this presidential election thing, right? It's always a good thing to come out in favor of Lincoln. Okay. David? Lincoln. Thank you for that tip. I'll keep it in mind. I don't want him to be on the wrong side of Lincoln. Or Jensen for that. Dow is down about 440, almost a 1% decline on the S&P. It's obviously will be a huge story today if these moves hold as the 10-year did briefly below 3-8. Wow. Watch the curve as well as we go to break. Be right back. Let's get to Jamin' Stop trading. One of these midnight downgrades, let's in the trouble, Goldman Sachs downgrade of Lulu, stepping the sidelines. Excuse me, challenges weigh on growth. This is really Lulu shooting themselves in the foot. They're talking about knowing about decline in innovation. I don't know where this one stops because the high multiple stocks are age. They're just not doing well, and I don't want to encourage people to try to bottom fish in those. If you want bottom fish, you bought a bottom fish in Mehta, right here in Microsoft, and I would say Microsoft, you bought them fish in 400, Amazon, 160, and Apple, you don't have to bottom fish because it's doing incredibly well. I'm going to leave out a video for now because it's become too emotional. I say own it and don't trade it, but it's very emotional right now, and I think you've got to let the people out of the stock before you come in. Everything piece on the tape today regarding Nike and their marketing spend, which has been ratcheting up year after year as they try to resuscitate some. Actually, their story talks about moving some savings from their restructuring into marketing. Well, look, I think that they have very good product and they don't seem to be in sync. This is the Olympics. Remember you used to buy Nike ahead of the Olympics? I would give a check. What Mark Zuckerberg talks about, giving a check to us and having great results, I think that Nike should take all this marketing spend and give it to Mark Zuckerberg and say, "Listen, here it is, my friend," and throw in some ads for Raybans, which I told you were sold out, and you laughed. I don't know why he keeps saying, "Carl, can you adjudicate here? Have I really laughed about the Raybans thing? I've laughed about the Vision Pro, not about the Raybans." I think you laughed at a lot of things I say, but I don't mind. Only on the inside. I love you. Only on the inside. That's a reference to Jensen Wong. I interrupted him, I said, "That was supposed to be funny." He goes, "Super funny, laughing on the inside," which was the ultimate put down of me. I thought it was hysterical, but I wouldn't buy matter right here and buy Microsoft 400. I'm just giving you some levels that I think are good levels. What do you want? I love you. What do you want? I love you, too. Do you? That's a nice blazer. Thank you. I appreciate that. I didn't know that Mow Ginsburg was full-rate. It's a wonderful place to shop. It's a wonderful place to shop. It's a wonderful place to shop. Mow Ginsburg. Thank you. Thank you. And after the show partner. GGX is really good downstairs, by the way. Finally, Jim, on crude, we're below 74. There actually has been some interesting pieces on the bullish trades among fund managers. Just taking off 40 billion in the last couple of days. We have that everyone says we're on the verge of a wider war in the mid-east, and oil can't get traction. If there was a peace agreement, then maybe oil goes to 65, and the world's a washroom. It's a wash. It's not the good trade. I mean, again, Chevron at 4%, I'm looking at yield. I'm looking for yield, because when you have the 10-year plummet, this is just a chance to be able to go pick some stuff up that have yield. But I think that the panic in the MAG-7 might be the trade. You can buy some now and then wait until quarter to three and take a look at where they take it. Because you can buy it at quarter to quarter if it's bad at quarter. What a show, Jim. Wow. It was a great show. That was a lot. And Dave, you were still the best. Did you date me again? I feel like I had narcos who looked like you. Yes, of course. That guy is so cool. He was also in that? Yeah, he's in a lot of stuff. He actually does. He's really cool. He's a resemblance. There's a family resemblance. And I know that you think you're burnfall. You ain't no burnfall. No, I'm not a burnfall. You love saying burnfall. No. Jim, we'll see you later. We'll take a quick break here as stocks do. Resume the selloff here. Dows down. 460. Lost 40K. Don't go anywhere. You've been listening to the opening bell on CNBC's Squawk on the street. 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