foreign aid bills. and caitlin clark is the top pick in the wnba draft. she won't be getting a big pay take. day. it is tuesday, april 16th, 2024 and "squawk box" begins right now. good morning. welcome to "squawk box" here on cnbc. we are live from the nasdaq market site in times square. i'm melissa lee with andrew ross sorkin. joe and becky are off today. let's look at equity futures at this hour. pointing lower across the board. s&p is down eight points. nasdaq is down 27. as for treasury yields, all eyes on the ten-year yield. we are just about there.

4.651%. taking a look at crude prices and how they are digesting in the middle east. wti is down .50%. $85 a barrel. brent is tame this morning at $89.75. a check on bitcoin days ahead of the halving. we are down fractionally. $63,352. new data from china overnight. first quarter gdp grew 5.3% year on year beating the estimate of 4% growth. export volumes rose 14% from a year ago. back here at home, united health is out with quarterly results. bertha coombs is here with more. everybody is looking at the medical loss ratio from the cyber attack there. >> the change cyber attack is

being looked at or accounted for in two buckets. united health revenue coming in at $99.8 billion. beating estimates. it is unclear if the adjusted $6.91 per share is comparable to the consensus number. it includes 25 cents per share impact for business disruption costs from the change cyber attack in february. it excludes the costs of advanced payments and interest-free loans due to the o outage which amounts to $6 billion so far. it is drilling down on overall performance. the top expectations at more than $6 billion which is up 13% year over year.

optum health includes the 90,000 do doctors. this includes a $279 million hit from change disruption costs. on the united healthcare insurance side, $75.4 billion in revenue was in line with expectations driven by commercial and medicare growth. net operating earnings came up light due to the cyber attack response. the medical costs ratio, medical loss ratio, saw 814.3% which is higher by .50% because united lo loosened pre-authorization

rules. this is lower from the fourth quarter. the overall trend among seniors is a headwind for the humana medicare users. we will see how they respond. >> the number of 84.3% means you should back out .50% because of the impact of the change? it is below 84%. that is better and what analysts hoped for. it was below the 84 tand the stock would go higher. >> the other thing to remember in terms of how this is reflected among peers, united health has 90,000 doctors. they back out the revenues because they do business with their doctors. they have what is called a value based care contract.

those weren't really disrupted. that isn't about claims every day. their peers may not have the same view. it is a positive notion in the sense they did not really calculate an extra speck ike in fourth quarter. >> exposed to medicare and that is humana and cigna. human is humana is higher on the back of the session. bertha coombs, thank you. >> a lot of morning show hosts who filled in at nighttime say good morning. >> you are on tv and this is what you say. >> itis what you are used to saying. good morning. >> nice to see you. on the agenda u let's talk about what is happening. earnings season rolling on. bank of america and morgan stanley anda johnson & johnson.

we will hear from the cfo joseph wolk while be here on cnbc. we have a lot going on with the data front. march housing is up at 8:30 and we have sara eisen speaking with christine lagarde. she will have that conversation happening in the 9:00 hour. later today, fed chair jay powell is speaking at the forum in washington at 1:15 p.m. a lot of folks speaking. jay powell is the one where you will hang on every word. >> how many rate cuts should we expect it? when? >> will he tell you anything? i argue he should top telling you anything. >> mary daly said no rush to cut

rates at this point. certainly the data states that. house speaker mike johnson plans to split the aid package for israel and ukraine to respond quickly on the attack over the weekend. marjorie taylor greene has threatened to force a vote on deposing the speaker if it has any ukraine aid. she has not decided to proceed with the ouster vote. speaker johnson anticipates the house will vote on the aid bills on friday. the first day of jury selection in the donald trump criminal trial concluded without any jurors seated. trump walked out of the courtroom and calling the trial a scam and criticizing the judge for refusing him to attend supreme court arguments next week reellated to the immunity

argument. meantime, shares of trump media closing 18% lower yesterday. this is after the company filed plans to issue more stock. that stock has fallen 60% from the recent high after the spac merger in march. they will seek to offer the resale up to 146 million shares of from selling security holders, including donald trump. trump is subject to a six-month l lockup period that expires in september. the lockup has not expired, but they are getting their ducks in a row to open the window for him. we'll see. >> the paper value of everything he has owned in this media

venture has gone down significantly. >> if the goal is to get him cash, if that is the goal and you can go on reddit and try to understand there are people who say this is a financing mechanism for him. yes, if the value keeps going down and he cannot get the money until september, you know, it is another 50% down, that's not helpful. meantime, iowa's caitlin clark was the number one pick in the wnba draft. she was chosen by the indiana fever. clark will be paid $76,000 in the first year of the league. when we come back, more on "squawk box." we will talk more about the israel response over the thwart of the attack by iran over the weekend.

and we will have mike novogratz with us to talk about the price of bitcoin that we very been talking about over the ekd. "squawk box" returns in a moment. >> announcer: this cnbc program is sponsored by baird. visit bairddifference.com. un ing th e power of thinkorswim, the award-winning trading platforms. bring your trades into focus on thinkorswim desktop with robust charting and analysis tools, including over 400 technical studies. tailor the platforms to your unique needs with nearly endless customization. and track market trends with up-to-the-minute news and insights. trade brilliantly with schwab.

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nbc news reporting the israel response to the iran attack over the weekend is imminent. urging restraint to avoid a deeper conflict in the region. we have our former brigadier general with us. great to have you on the broadcast. we are trying to understand what comes next. there are a lot of folks pushing and pulling netanyahu and israel to do certain things or not. what will happen next? >> i think there will be a response. i think it will be pretty significant. i don't necessary think it will mimic what the iranians did by firing missiles. it could be a strike on the iranian nuclear facility. it could be what they have done in the past. targeted assassinations. it will be significant if the talk from the war council and cabinet is accurate that they must reestablish deterrence.

candidly, it is clear they have to do something, but the question is when. >> do you believe they have to do something? as we heard over the weekend, president biden was telling netanyahu that this should be considered a win. take it as a win was the readout from the call he made over the weekend to netanyahu in terms of their ability to shoot down so many of these missiles and drones and other things. >> i think it is important to note that as many experts have said what happened the other day was that iran truly demonstrated how weak their systems are with the cruise missiles falling out of the sky and drones knocked out with relative ease. in many ways, deterrence has been reestablished. in many ways, the story is reversed. iran is the new david here.

it does not seem necessary, particularly with the international outrage, that israel has to do more to reestablish tdeterrence. the weakness of iran demonstrates that deterrence. >> if that's the case, why just moments ago you thought they would. >> what i think and what they think are two different things. i believe there is a view in israel and there is a re-attack. we talked about that yesterday. if you take the international per spespe perspective, there is less of a reason to do it than the israelis feel. >> whatt escalation? it may not be this chess move, but the next chess move.

if iran is so weak over what took place over the weekend, that may be an escalation is not an escalation. >> remember, this is actually an escalation now. israel attacked in damascus. iranians responded. israelis believe they have to counter respond. if this continues back and forth, this miss yocalculation what i'm concerned about we could find our seveselves in a r conflict. i don't believe that is in the minds of the israeli war cabinet. >> general, iran said it would respond to any counter attack with more severe and immediate

blow. we already heard from china as well. reasserting the iran and china relationship saying they will stand by iran and willing to work with iran across the different categories. how does this sort of play out given that china is going to be aligned with iran and the rest of the world and western allies aligned with israel? >> i don't necessarily see this in a stark terms as west/west and china versus the united states and iran against israel. it is clear the american influence is dpliniminishing. china generally has a fear and loathing among iran of the ararab leadership. what we don't want to see is this spin out of control. >> brigadier general, thank you.

it is so important during these times. we hope to talk to you soon. >> thank you. coming up, a group of lawmakers want the nasdaq to de-list chinese companies. details next. plus, quarterly results from johnson & johnson and bank of america and morgan stanley expected in the next hour. we will bring you the reaction from wall street. in the meantime, dow futures are positive from the report of united health. you back out 4% from change health and it is below 84. that's what analysts wanted. dow is opening higher by 78 points. "squawk box" will be right back. your record label is taking off. but so is your sound engineer. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates

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welcome back to "squawk box." johnson & johnson is just out with earnings. $2.71 a share. that is on revenue of $21.8 billion. the company is increasing the

midpoint for the full-year guidance. the stock is off marginally. cfo joseph wolk will be with us later this hour to discuss all of the numbers and so much more right here on cnbc. lawmakers in washington want the nasdaq to delist chinese securities. we have emily wilkins with more. >> reporter: a group of lawmakers are encouraging to delist companies on nasdaq. some are sounding the alarm that chinese company has raised over $190 million while assisting the military. the company uses lasers to measure the distance of objects. the member of the select

committee said the funds went toward building a factory in china to help the liberation army target u.s. systems and access military equipment. she is looking forward to working to delist the company and others that pose a risk from privacy and national security. in this letter is the outgoing chair mike gallagher and the incoming chair and a potential vice president contender for donald trump. they responded to the questions around the black listed companies in the next 30 days. we know we hope this starts a conversation. guys. >> i'm curious. emily, do you know how long it has been a publicly listed company in the united states?

i'm trying to understand at what point did it become apparent to lawmakers this was going on and what proof do they have that the money is actually used for that purpose of targeting u.s. potential targets? >> reporter: a number of things have been recent. they have been trading since early 2023. you saw the select committee on the ccp take up this issue in previous years. they came out with another letter asking the department of defense to put this company on the list. this is something the company has been tracking with the technology companies. this technology is already being used in the u.s. you have seen it in evs and smart cities with bridges and traffic lights to sense the cars in the area. i think that is part of where this concern from the committee is coming from and part of the reason there needs to be a fuller picture at how groups like the nasdaq handle companies

like this one. >> it seems like it is too late. given they have 47% market share and technology is being used in lots of applications that are here in the united states. the concern, i would think, is a national security one on the technology front with access to d data. >> reporter: it is a great point, melissa. to a certain extent, the technology is there and market share is there. a lot of folks on the committee would say it might be need to b aware of others in the future. other chinese technology companies and advances they are making means you hear discussions about technology and a.i. and that means it centers around the fact if the u.s. doesn't keep up with what's going on and the latest technology, we could fall behind

other countries like china. that is something that is on the minds of lawmakers. >> emily, thank you. emily wilkins in d.c. coming up on the other side of the break, we will talk about the drop in the shares of trump media and the start of the former president's criminal hush money trial yesterday in manhattan. we will have that discussion in a moment. as we head to break, we will look at yesterday's s&p 500 winners and losers. >> announcer: executive edge is sponsored by at&t business. next level moments need the next level network. and it just might change the world. but here's the thing, i can't do it... alone. so, are you in?

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good morning. welcome back to "squawk box" here on cnbc. we are live in the nasdaq market site in times square. the s&p is looking to open down about 13 points. shares of trump media are looking down as well. plummeting yesterday as the company filed for additional stock itchssuance on the same d the hush money trial began. the stock is down 40% since it started to trade. we are trying to make sense of it. we will continue right now.

liz hoffman is here from semafor. congratulations ahead of your conference in washington, d.c. >> thank you. >> when you saw the filing, what is the filing trying to say? >> i don't know. i read it a couple of times. it is actually not issuing stock, but issuing warrants baked into the pie. this is a company that is volatile and not that good at explaining anything and heavily owned by retail investors who don't know who is going on. that is how you end up with a move like that. >> the big question is when do we think that this board, if the board is going to decide to allow the former president or others, to sell shares before the six-month window, how does it work? what disclosure is necessary? does the stock move up or down on that news? i think these are the things people who are invested in this

are trying to figure out and then the question is what does it mean to be invested in this company? >> right. you can makeither way. it can flood the market. you can see it creating a buying swell that brings the whole thing up. i don't know. the shareholder lawsuits that would follow waving a lockup. you can do it, but it would be messy. i think to the point you are trying to make, why does anyone own this stock? a company with a single product that not many people use. it has been losing money hand over fist. i'm not surprised you will see them issue new equity. they have to. $60 million last year. >> does this allow them to get around the issue of the waiver? it brings forward some sales and it is to your point about an

uprising if the waiver were granted. this allows them to get around it. >> it would allow former president trump to be liquid to perhaps borrow against. that is one piece we have not talked about or seen. there is not a lot of disclo disclosure. a slug of stock. >> there are people that you can find on reddit and elsewhere who talk about this not as a meme stock or as investment, but actually as a financing vehicle. a campaign financing vehicle. a transfer of wealth from the investor community which could be a donor. i'm donating my funds to the former president by investing in this stock such that he can then sell his shares later to be used

for the campaign. >> and the beauty of that is if you lose money, you take the loss. you can donate money, the stock goes up. i'm supporting president trump. that's what i want to do. stock goes down. you lose money. you take the loss. capital gains loss. >> you can donate to president trump's campaign. are these sophisticated investors? >> it is hard to tell. >> what we need to watch here is if the stock actually moves higher in a meaningful way. could it be there are a bunch of people, wealthy people, possibly outside the country or others, who literally are pushing the stock up? it is not an investment, but a way to transfer wealth? rather than just being a retail investor which we use the phrase

and it is dismissive. it shouldn't be. >> for the moment, this is still trading to me like a meme stock and it will be six months out from the election and i expect it to be a hard beat for the campaign. this is more broadly something i have not understood the case for the ideological echo chambers. they were all supposed to be the next big thing. i don't think they are. more broadly, public square kind of america first marketplace. $20 a share and now under $5. if you try to own the libs, these are built -- >> if joe were here and joe and i disagree on this. joe has made the argument and it is unfair he is not sitting here to talk about it. he would say what about the prospect the former president becomes the president and decides this is the only platform he will use to communicate with the american

public. will more people start to sign up to live on truth social so they can interact or hear directly from the president and is that something that is potentially monetizable later on? >> we would as journalists. >> why hasn't he done that already if this is so key to financing his campaign? >> he does that already. a lot of folks in the journalist community are not signed up for it. >> he is not president. >> you have a twitter clone. the echo chambers have not gotten the currency and eyes that have been monetized so far. >> talk about for a quick second the semafor echo chamber. you have a conference coming up in washington, d.c. on the back or sidelines, if you will, of the big imf meeting. >> world economy summit.

i'm headed down after this. seven cabinet secretaries and 20 ceos and central bankers all over the world. we have seen three or four years of people pulling playbooks off the shelves and now trying to put them back. it is not going well. we are talking to jeremy hunt, the german finance minister and see how europe hasn't grown in 18 months. what are we doing here and we hope to squeeze answers out of them. >> we look forward to it. thank you. coming up, read on inflation from restaurant owner cameron mitchell and the ceo from johnson & johnson will join us. we'll be right back.

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you can spend less time searching and more time learning. trade brilliantly with schwab. last week's inflation data showing food prices still elevated and hitting americans dining out. food prices outside the home have jumped 4.2% for the year. joining us is cameron mitchell. founder of cameron mitchell restaurants. great to have you. >> good to be with you. >> ywe mentioned the food costs on the rise, but gas prices are higher and electricity bills are higher. what are you seeing with the consumers' willingness to spend at an a restaurant?

>> our guest traffic is up over 2019. that is a good sign. we have fallen since 2022. we had tremendous amount of money out from the government so people were spending. we have a slight reset. all in all, we are doing well. our prices have just taken a 2% price increase here a month ago. we had to with the annual spring price increase. still keeping our prices lower. our inflationary price is not that much. cost of goods for us is the one bright spot. we have seen reduction in the inbound cost of goods down 1% on the overall pa&l. >> that's on the cost of goods. how about labor costs?

those are going up across the board across the country. >> that's the sticky point. that is a good thing for us. the actual labor costs out in the restaurant business is up 40% since 2019. >> 40%? 4-0? >> yeah. salary and hourly bablabor. the prices have risen 25% on the pace of 4% in the past four years. we cannot keep up with labor in that regard. as long as we get costs of goods down and get our interest rates back down a bit, that will help out tremendously. it is a good thing overall for the restaurant industry see the wages increase. they are not coming back down. >> you mentioned 2.2% spring increase to menu prices. cam cameron, are you at the point where you cannot rise prices

more? i don't know what you have seen in terms of total check or if people are cutting back of what they are spending? >> total check is still holding up. it is a slight count above 19. we see a slight drop over last year. slight decrease in overall sales. you know, as far as the consumer goes, i think so far they are holding up. we have seen that in other data around the country. >> cameron, thank you. >> thank you. great to be here, melissa. coming up, house speaker mike johnson claims to split foreign aid bills. we will get the scuttlebutt from washington with jake sherman next. >> announcer: this cnbc program is sponsored by baird. visit bairddifference.com.

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bank of america reporting the quarterly results. leslie picker has results. >> shares moving lower on the numbers. bank of america beating on the top line generating $26 billion on revenue on the tax equal basis surpassing estimates by $5090 million. a quarter over quarter gain, but flat from q1 in 2023. it could help bolster nii. we will get more guidance on the conference call, but it creates a drag on the balance sheet with the realized losses. they don't intend to realize the losses. net charge-offs came in higher at $1.5 billion driven by credit cards and commercial real estate. investment banking is a bright

spot up a whopping 35% year over year to $1.6 billion in revenue. markets also higher as gains in equities helped offset declines and fixed income. wealth management generated $5.6 billion. bank of america reporting 83 cents a share excluding the special assessment from the fdic. the cost that comes in addition to the levy last quarter. the banking system owes that to cover the bank system failures last year. we are not comparing to analyst estimates. it is a one-time item. we are just telling you the number so you have it. >> okay. leslie, thank you. fill us in when you have the comparable. house speaker mike johnson will split foreign aid bills. we have punch bowl's jake

sherman with us. great to have you here with us. is the speaker's fate really hanging in the balance here? >> absolutely. there's been a group of republicans for a long time that suggested if johnson puts any ukraine aid on the floor, his job would be in danger. that is still a live option. the question he is a few things. number one, do they want to replace the speaker again? do they want to replace the speaker in the middle of the election season when the speaker is raising money for the party. raised $20 million for house republicans last quarter. that is a very important job. probably a good 50% of what he has to do. to be honest with you, the majority of the house of representatives is in favor of ukraine and in favor of aid to israel especially after the iranian an attacks. they are in favor of aid to taiwan. republicans are in the bill and planning to see if it is able to happen and planning to ban

tiktok and selloff seized russian assets. this is a big package and moment for mike johnson and the house of representatives. >> that's a lot of things lumped into one report and how inefficient moment for the speaker. >> lumping everything to go to get everything done at once, and the likelihood of anything getting done diminishes, jake. i assume aid to israel is on the forefront given what is going on now and our awaiting israel's response to the retaliation over the weekend, and will ukraine make it shortly there after? >> these are all individual votes, so all need 218, but to be honest with you it's a big

open question as to what passes and what gets knocked out. i would say all three, israel, taiwan and ukraine will get through. listen, mike johnson has been putting off this decision now for months and months and months. he has a good number of house republicans who are frustrated with him and his in decision, and the decisions are made exst extraordinary slow especially when compared to kevin mccarthy and nancy pelosi and paul ryan. now johnson is pro ukraine aid with caveats. i would say it gets over the finish line. it will be a rocky week, though. >> if it gets over the finish

line, does he have his job when it's over? marjorie taylor greene will do everything they can to throw him over, no? >> i don't know the answer to that. the larger question is to democrats. you need half the house on the floor to remain speaker, and that's 218 votes, and democrats indicated they would vote for him or not vote at all if he did the, quote, unquote, right thing when it came to that ukraine. we will have to see, the proof is in the text that we should see later today. is it sustainable as a republican on the backs of the democrats? that's a different question. johnson has a one-seat majority.

it looks to be what mike johnson will do should republicans move against him. >> jake, thank you. jake sherman. coming up on the other side of this, johnson & johnson reporting. then later, michael novogratz, and we will talk about the crypto market and what it has meant to the larger markets. all that coming up in the 8:00 hour. we're coming right back.

johnson & johnson out with its first quarter results afew minutes ago. the stock marginally down on the news, about 2% off. johnson & johnson's chief

financial officer is here. there were good numbers in here, joe. nice to see you. i want to understand what you think went right and how some of the markets didn't think went right, as i was thinking, and what you think about that? >> we are encouraged by our first quarter performance. about 18 months ago we wanted to be a more growthier company, and we had 7.6% top-line growth, and we have done well with the pharmaceutical and med tech business and pharmaceuticals specifically growing 8.3% with a number of new products continuing a very strong start to their launches. while i am encouraged by the performance and that sets us up to meet the guidance for the year, and that improved on the

operational side. i am emboldened for what that means in the future. a number of large clinical readouts at medical meetings, and noncell lung cancer, and collide us, and peptide for the treatment of sue ryiouses ablaisson. on the capital occasion front, we remain very active. 16.6% spent in rnd to further

strengthen the future. we were proud to declare this morning the 62nd consecutive year for the dividend increase, and the antibody congress hrut. about 11 days ago we were pleased to announce our atornadotion to acquire shock wave medical. >> that was a 4.2% increase to the dividend. i wanted to ask you about the full year, and you only raised the full year by 2 cents, and maybe that's the disappointment in the premarket session. can you talk to us about how you see the rest of the year. does it seem like you are as

optimistic as results come in? >> it's early in the year, and as you listen to and look at the advancements we have had, and we will give our teams every opportunity to accelerate the programs further and then new ones. it's a matter of being in the year and looking for the opportunity to invest and fortify the future as opposed to being negative about anything on the horizon. we are optimistic we will hit the annual guidance we provided in january. >> i have a med tech question for you. a lot of the devices and surgeries and orthopedics you have been doing, and benefited from the folks doing nonurgent surgeries, stuff folks didn't do during the covid, and i am talking about the strength of the consumer, and how you think those relate to some of the

things right now, and in the consumer space, a week ago, saying everybody is trading down and he's seeing the trade down, and can you see the strength of the consumer through that? >> we do, andrew. i would have to parse out normal health care spending habits, and when it comes to their mobility and ability to lead a fulfilling life. we're still seeing the same levels, and i would say it's somewh somewhat pronounced in the orthopedic place, where people did put off hip and knee surgeries and we saw that in this last quarter, and we have not seen a back tracking of

that. >> that's bad news for insurers. when it comes to the stock itself, analyst are saying they are doing well on the one side, and in terms of the top liability, can you give investors a timeframe of when those liabilities will end? >> yeah, you talked specifically on "fast money" about the multidistrict litigation, and their opportunity or the judge's order to look at the scientific evidence that the plaintiff's bar is bringing in the cases, and we said that is junk science, and the judge reopening that is a very significant development. in terms of a timeline, it's hard to predict. you will see we had elevated payments for elective and

strategic investments, and i wanted to ensure your listeners today, that 99.9% of the organization is focussed on bringing new technologies for better living. we have exposed some of the plaintiff's practice bar, and we have some looking at the financing behind some of the suits being brought forth and they are concerned about foreign financing that gives them access to discovery that could unveil ip that we would like to protect. on a number of fronts we are looking to get the broad resolution behind us. as you can see from our actions, we continue to operate for the long-term and that includes increasing our dividend and investing heavily in rnd for the future and investing in the

businesses we have today. >> we appreciate it. just after 7:00 a.m. on the east coast. you are watching "squawk box" right here on cnbc. i am andrew ross sorkin along with melissa lee, and becky and joe are off today. mike johnson planning to move ahead for foreign aid bills, and we will see what happens in washington and talk more about it. in the meantime, morgan stanley expected to report quarterly results in this hour, and we will bring you that number and instant reaction. and then the shares at live nation, and the justice department plans to file a antitrust suit against that company as soon as next month. we saw the dow go positive,

and we are looking to be open higher by 149 points. the nasdaq will be up by three. let's get to dom chu with a look at other premarket movers. >> let's start off with united health. it has been a driver of the action so far. this is america's most valuable health insurer and the most heavily weighted stock in the dow jones. in and of itself it would have created a 2210-point gain on it own. given what is being included in the terms of the impact of the large cyberattack during the period affecting its change health care unit. united health did say the total impact of the cyberattack was

cents per share on the quarter. next up you have an analyst call getting attention. advanced microisup. this is helped, and they are citing things like the non ai segments. for more on that call, subscribers can head over to cnbc.com/proaccess. let's end on some macro big picture movers, and that's the treasury complex.

those trends, lower sovereign bond prices, and higher interest rates. every bond across the curve is higher in terms of rates. the benchmark two-year yield, around 4.9%. and then the i-shares have been lower in terms of prices. back over to you. >> thank you, dom chu. our next guest says the equity market is under a correction and the s&p 500 failed to hold, and it's now near 4,900. for more, let's bring in the financial strategist. if we drop to that level, then

what leads us there to the downside? >> as dom was highlighted, interest rates have been backing up and the market has not liked that. in addition, the geopolitics are making investors very nervous. melissa, remember, markets have 5% corrections three or four times a year, and a 10% correction once a year. we were expecting a correction after the first quarter was up 10%, and the markets rallied 30% off the october low. april showers bring may flowers, and we think the equity markets will blossom. in terms of risks, we are watching crude oil. we think that would be the catalyst for a very deeper correction if crude got above 100 and stayed above 100. right now we don't see that happening, and we actually see crude oil falling.

>> blooms, like the one in your hair. very cherry on a tuesday. but i wanted to watch crude and the treasuries, and there are a lot of wonky things going on, and some think opec plus can cap the lid on crude going higher, and there are could be concerns about issuance. can you talk to us about how you factor in what otherwise would be indicators to you about where the markets would be going and how other outside influences are clouding how these indicators are moving at this point. >> you know, as you pointed out, retail sales came in stronger than expected and that moved interest rates. that's a positive. that means the economy is doing well. the consumer is still spending and there's a majority part of

the spending in our economy. we still have a tremendous amount of cash on the sidelines, and network is at a record all-time high. there are stresses in the middle east, and as long as the supplies of crude oil are not contained in a long-term detrimental way, we think the markets can recover. maybe an example in history we can use, the markets of 1990 when saddam hussein invaded kuwait, markets went down sharply. i think it's appropriate to review your asset allocation and if you have too much cash on the sidelines, we are telling clients to get your buy list out and we think it's going to be a good buying opportunity.

>> thank you. when we come back, sources telling nbc news, the israel response to iran's attack may be imminent. we will talk about that straight ahead. plus, we are awaiting morgan stanley numbers. do not go ywreanhe. "squawk" returns right after this.

ahead.

♪ ♪ welcome back to "squawk box." nbc news reporting israel's response to iran's attack over the weekend could be imminent. richard engel joins us from jerusalem this morning. >> reporter: the israeli war cabinet is meeting again today for the third straight day in a row, and sources are telling nbc news that they are very much looking at a military response against iran for this weekend's

attack that iran carried out, a failed attack with drones and ballistic missiles and cruise missiles, and we are not clear what kind of attack that will be with four different u.s. officials telling nbc news that israel is contemplating ways to send a message to iran, that they want to do the attack sooner rather than later so it's closely timed to the iranian attack. they don't want to wait weeks or even many days, but they are trying to calibrate it in a way that doesn't provoke a wider war, and that's a lot easier said than done, because what israel does and believes is not provoking a war is not necessarily how iran will perceive any israeli action, and iran said if it's attacked by israel it will respond immediately. according to the u.s. officials,

some of the options israel is considering include attacks on iranian proxies outside of iran's borders, but those officials stress that a final decision from israel hasn't been made and could change. they are bracing in the united states and all across the middle east for some sort of israeli response. we just don't know where or the extent, and i think that's something that they will try and calibrate today at the third war cabinet today. >> two questions. one is -- we spoke to you about this yesterday, but i am curious if it changed or shifts in any way, but what is the appetite on the ground for the israelis for some type of retaliation, and how that relates to netanyahu and others to retaliate right now? >> reporter: well, all politics

are local, as was famously said, and i think that applies in this case. israel is divided, and seems to be divided roughly in half with netanyahu supporters, and some of the more extreme members of the government arguing for an immediate and very robust military response, and one of his ministers wrote that israel should go crazy on iran, ben cravier, and we are seeing protests on the street again every week in tel aviv with sometimes more than 100,000 people taking part, and they don't believe that netanyahu is acting in israel's best interest in terms of security, and they don't want to seean escalation. they don't want to see this country criticized, accused of

genocide in gaza and other places. they want to dismantle hamas but don't want to see this go over an edge that would be difficult for israel to pull back from. there's not a single opinion about iran. >> finally, then, and maybe it's the natural follow-up to this you know, president biden telling netanyahu over the weekend, take this as a win, meaning given that you were able to get 99% of those missiles and drones, you know, not to hit anything, if, in fact, they do retaliate, how does that change the relationship between israel and the u.s., or does it? >> reporter: well, it's the relationship between netanyahu and president biden. the relationship between israel and the united states is long and it's very solid, but the relationship between president biden and netanyahu are poor and

have long been poor and netanyahu has not been following president biden's advice since the beginning of the conflict when it comes to rafah and allowing more aid into gaza and the two-state solution, which president biden favors and prime minister netanyahu has overtly rejected, so it would be another prime example when prime minister netanyahu is telling president biden to mind his own business even though the united states has sent aid over, and participated over the weekend when it was attacked by the drones and missiles from iran. israel carried out a strike against the empbassy -- the

iranian compound and they did not notify the united states ahead of time, and this particular round was started with that attack two weeks ago. iran said it would respond and did respond and the attack was unsuccessful because the misses were shot down, and president biden saying let's leave it there and not take this further, but the israeli cabinet now is contemplating ways to respond and believes it's necessary to respond in short order. >> richard engel, thank you. in the meantime, we will continue the conversation right now with what is at stake in the region, good morning to you, david. i will ask the same question which we just asked richard, if israel were to move forward with

the retaliatory effort, does that change the balance with the relationship that president biden or maybe the u.s. has with israel and.net? >> ultimately the u.s. and israeli relationship, i think the administration in the last six months has been very reluctant for many reasons, the bond with israel and the politics, certainly on the republican side, and the determination of joe biden to turn the look -- i think the administration has been reluctant to impose a single cost on israel, and when the israelis were attacked and a new

threshold was established, that has not happened by another state for are 33 years, since hussein attacked with 33 scuds, and the u.s. did not respond. i think the u.s. will have little choice but to accept the realities the israelis are going to respond, and the question is success in failure or escalation, and i think the administration will have to factor all that in in the days ahead. >> if, in fact, israel does retaliate, can you imagine -- i won't say how, and i won't even ask if, but how does it escalate or does it not? >> no pun intended, but the nuclear option, at the site of

iran's materials, that's one option. and then number two, the strike against the iranian revolutionary guard department, the aerospace department that was responsible for launching the attacks on april 13th, or something more moderate and calibrated, and so attacks against iranian, and if i had to guess and it's only a guess, i would suspect the israelis need to believe they are re-establishing deterrence. i suspect they will try and strike at iran proper, and as you put it, it's the degree to which the iranians are done, and they got 3,000 ballistic

missiles and not many of them could hit israel, and there's no question that the israelis could do unbelievable damage to iran's conventional and unconventional basis, and this depends on how they do, and the supreme leader of the iranian military, how he chooses to play this. >> thank you. it's a longer conversation and we hope to continue it with you. thank you. >> thanks for having me. still to come, analysts reaction to united health results, and that stock is up. unh helping the dow out this morning. the dow looking to open higher, and the nasdaq looking to be up

by five. "squawk box" will be right back. why not? did you forget something? my protein shake. the future isn't scary, not investing in it is. you're so dramatic amelia. bye jen. 100 innovative companies, one etf. before investing, carefully read and consider fund investment objectives, risks, charges expenses and more prospectus at invesco.com.

bank of america reporting an adjusted 8cents, and that was ahead of expectations. that stock down just fractionally. and in the meantime, joining us now to break down the numbers, equity -- health care equity

strategist. good to have you with us. everybody was talking about the medical loss ratio that came in, and if you back out the impact from change, it came in a little better than what you thought it might. >> yeah, melissa, great to see you. yeah, this sub 84% number is very significant. obviously, you know, sentiment headed into the quarter for united and managed care as a group broadly, pretty negative, down 15% year to date on this one specifically. you have a better mlr, and the earnings look like a clean beat, and a little over 60 billion, and it's what investors and analysts see as the go forward plan here. >> we are seeing related reactions from humana and cvs,

those most exposed to the health care. in a little over an hour's time, what do you want to hear? they guided very conservatively in that they told investors basically to expect a higher valuation rate -- >> i don't think we will get anything out of the company that is ulgt mittly negative with respect to their view on utilization through the course of the year. i think they will remain conservative, and the numbers the street has reflect that already. it's tough to parse out all the changes in the quarter, but it doesn't seem like from the commentary from the release, they expect that change, and maybe the outlook is similar and they can manage mlr

appropriately. it's a difficult number to kind of, you know, analyze on a line by line item basis, because we don't have that much information, but stock will go higher from here. >> you are more optimistic than you were last night on unh? >> i am not more optimistic, but i feel like the numbers are better than the analysts community at large believed they would comein at. earnings are strong, and i think, you know, maybe even more important than the mlr because of all the one timers, and when you consider the one-timers in the quarter, they were still able to beat and that was a concern and we talked about that last night as well. it's tricky, right, because you have unh this morning that looks like a good number relative to expectations, and then you look at j&j and look at the detail

within that company, the medical device segment overall for key categories that kind of are impacted by procedure volume, orthopedics, cardiology, were very strong. it's difficult, actually, with both of the sets of numbers to reconcile exactly what is going on here, and you can argue both are strong here. >> yeah, and the utilization looks good. jared, good to see you. leslie joins us with the numbers that are out. >> i see a beat on the top and bottom line, and on the top line beating by half a billion here -- more than half a billion. morgan stanley reporting $1.1 billion in revenue, and all of that driven by security, and

then the institutional securities group came in close to estimates but up 16% year over year, and that was thanks in part to strength and equity as well as underwriting revenues. fixed income also a beat, and equities a beat as well, and both generating $2.5 billion for fixed income. global wealth management a beat relative to wealth consensus. a bit of a slowdown in net new assets year over year. investments management is the one division where they came in light of expectations, and the

ceo saying in the release that, quote, as a result of strong net new asset growth the firm has reached $7 trillion in client assets across client wealth and asset management. you can see the share is down about 2.3%, perhaps on some of the net new assets numbers, and we are still digging through the release and will let you know what we find. >> there will be a lot of questions about the investigations going on, right, by various regulatory bodies. >> i would imagine those are going to be brought up by analysts as they have been in the past. >> thank you, leslie. we will talk about tesla coming up, because the stock is down 35% year to date, and layoffs were announced adding more pressure to the stock. later, we will talabt k ouall things media.

"squawk box" returns after this.

box." tesla shares have been heading downhill since the start of 2024. phil lebeau joins us. >> tesla shares are where they were a year ago. it has been a heck of a roller coaster ride.

the company announcing local layoffs much more than 10% of its staff here in the u.s. and china and other locations. that's approximately 14,000 workers. there are two key executives that announced yesterday, separate from the layoffs, they will be departing the company. when talking about it on x or posting about it on x, elon musk said every five years we need to reorganize and streamline the company ahead of growth. here's the challenge for tesla. when you look at the global deliveries. they had the first quarter to first quarter, many believe they will not hit 1.8 million even though the consensus right now remains a slight beat year over year at 1.94 million vehicles. you have the robo taxi question. the company said it will unveil

the robo taxi on august 8th, and left unsaid on the post from elon musk, a, where it will be manufactured, and will we get true details about this as to when and where it will go into service. many said don't expect it to go into service anytime soon, and then what happens with the small car plans that for a long time fueled a lot of the optimism about tesla shares in the future. we will get the earnings after the bell next week and then the conference call on the 23rd. >> i thought robo taxi -- the lower cost vehicle was key to robo taxi, that you needed the lower cost in order to have a viable robo taxi business? >> you would think. but there has been this report that did they pull back plans on

a model 2? will they still develop a model 2 or develop a lower cost vehicle that will be the robo taxi? a lot of unknowns there. >> i know we have to go and they are playing the music, but will they have to use other technologies that are typically not onboard the current tesla or will they try to do it strictly with the kind of tech that is sitting onboard already? >> i think he's going to go with the existing tech anthd at's going to be the big challenge. and then we will get an outlook for rates and what it means for markets, next. "squawk box" will be right back. this is "realtime insights." i am here with ey deputy.

>> the landscape is changing, and one, we have a tax bill with the senate and the tax cliff that is expiring taxes. >> i am sure tax professionals are paying attention to that, and how is it relevant to the rest of the c suite? >> depending on who wins the election, we could see a decrease in the tax rate or increase. we have something called rnd expense versus capitalization and that will change significantly. corporate amt will go up, and there's complexity when you look at those changes when they flow through a tax return or financial statement. >> how are you advising your clients? >> we are advising clients to make sure they are modeling out

all of these. it's very important they are communicating this to stakeholders. >> martin, appreciate your insights. thanks so much. >> thanks for having me. treasury yields climbing to new highs yesterday after another hot economic report revealed the economy's resiliency. kathy, great to have you here with us on the set. >> thanks for having me. >> you think rates will go higher, as high as 4.8%? >> yeah, i think the next stop is 4.75, so 4.8, and hopefully we don't get news of a labor slowdown, and i don't see what will happen it between now and 4.75. >> if rates are high and the

economy is not doing well, that's a very bad thing. what is the scenario you are banking on at this point? >> consumers are spending but are using debt to finance it, and we are seeing delinquency rates on credit cards and auto loans turn up. we will have to wait until later in the year. >> you are still expecting two rate cuts? >> yes. we still have them pencilled in. it's getting diceyer every day because of the communications from the fed, you know, are changing. i think we have to consider that you have a fed funds rate of 5.5%, and you have an inflation rate of core pc is 2.8, and there's a big spread there. if we are correct and things slow down and conflation continues to add, there's room for the fed to cut.

>> do you think jay powell will say anything to give you a sense of any of that? >> that's a tough one. it's hard. they keep moving the goal post. one day they are looking at the labor market and then they look at something else. i think they will wait until later in the year. >> you seem pretty optimistic still about the consumer, and as they take on more debt and use credit cards to finance their debt, those rates are going higher along with treasury yields. i am wondering at what point you get concerned about the consumer and how much they are able to handle? >> the concern comes in when job growth slows down. it's like people have jobs and they spend money and feel free to use debt financing for that, you know, unless you are at the stress level, which we are seeing with lower income folks. but in general, as long as job growth is healthy, people will probably spend. we are looking for job growth to

add from here. it has been extraordinary strong but i think it will slow later in the year. >> what role does treasury issuance apply in the whole forecast here? >> not very much. >> okay. >> the reason is, if you try and find the correlation between treasury issuance and yields, you can't find it. short-term -- >> historically? >> historically. i mean, i started on the trading desk many years ago and it was always the thought that when issuance picks up, yields will rise and if you look at the numbers that doesn't really happen. it's not great that the treasury has to issue more as debt goes up but i don't think that's a make or break for the market. >> thank you. >> thank you. coming up, josh will join us, and we are talking about israel and iran tensions and maybe the push for funding on capitol hill. what will happen today and the next several days in washington. then, at the top of the hour,

bitcoin's wild ride, and michael novogratz. we will speak to him in a bit. we're coming right back.

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welcome back to "squawk box." a bipartisan group of elected officials are urging speaker johnson to bring the supplemental aid package to the house floor for a vote. our next guest is leading that, and he has a letter signed by about 90 members of congress. it doesn't appear he will do it or do it the way you want him to? >> he made a decision yesterday and i hope it works. it's a high stake gamble, and that would include aid for ukraine, humanitarian aid and support for taiwan, and the speaker decided we will vote on that one by one. i hope it works. it's a bit of a gamble. at the end of the day, what is most important that we get it

done and across the finish line. we don't have anytime to waste here. >> let's appear what appears to be a gamble and it's a gamble to his speakership to some degree. could you imagine the democrats trying to push him out at this point or no? >> well, i think what the democrats are focused on is can we get the package done, and not putting the cart before the horse and we have to see if he can get this pushed across the finish line, and republicans have to come to the democrats and we have come together in a bipartisan way, and this is a moment where we have to come together. one of the biggest things i fear, and that could sink this whole thing is if the republicans this week try and add an amendment, like a poison pill to one of the bills and it would sink the whole ship. >> can you speak technically how

that happens, and how they combine the bills? >> in the simplest way possible to explain, we vote on a procedural motion that says after we vote on them all individually, whatever passes gets combined back together in one to the senate. the senate will then consider it as a package. that's why the key is, let's listen, we haven't seen the language yet. if it's consistent with what the senate has sent us, with 70 votes, a couple months ago, they had 70 votes behind it, strongly bipartisan and doing the right thing, to hear stand up for our allies and stand up for ukraine and get that humanitarian aid against our number one adversary, china. i think the senate will pass it anyway. we have to make sure you don't have any extremists in there

trying to ruin the whole deal. >> is your sense that the israel package passes, but potentially the ukraine or taiwan does not? how do you handicap the various packages? >> i think they'll be -- given the fact that you'll get democrats and republicans different numbers on each bill, i think you'll getover the hump, get a majority on each of them. that's my prediction. again, you've got to see what the language says. the only way that gets derailed is if somebody throws in something that has nothing to do with the rest of it and tries to purposefully derail the package. that's the only thing that you can't really predict right now. but, again, what's critically important is if you look at ukraine and see the dire situation they're in, it's 5-1 in ammunition, they don't have enough missile defense systems. we know israel after this week, the attack from iran, their systems are depleted. and of course, china continues to threaten taiwan every day. so you look at thethreat of all of these democracies against our enemies, iran, china, russia, north korea, that access, we've got to get this done and time --

you have no time waste here. >> let me ask you this. i know you're referring to extremists in the republican party, i'm curious if there's been any recriminations or even conversations in the democratic party with people like aoc and others who were unhappy back in 2021, for example, about funding the iron dome, where she ultimately voted "present" in the end. i know she's switched her position more recently on this. but clearly, iron dome over the weekend, saved countless, hundreds of thousands, if not more, lives. and whether there are conversations in inside your party with people like that? >> listen, you saw, to your point, which was a really important one, between iron dome and arrow three and missile sling, all of these missile defense systems that were working not with just the united states and france and great britain, and france and saudi arabia and the jordanians, able to knock everything out but a couple. it was remarkable.

thank god for those missile defense systems. you're right, it's very frustrating that some of my colleagues -- by the way, there were people on the far right that have voted against these packages as well. most recently in this budget that just passed that had mi missile defense funding in it as well. i home people are able to see what can be accomplished with the right systems and the right technology and why missile defense is so important. and voting against them makes no sense, especially iron dome, and we have worked together with them on that technology. >> come on back as things progress or don't over the weekend -- or not the weekend, this week. >> we'll get this done friday night. that's the plan. >> thank you. coming up, all things media, with analyst rich greenfield at the top of the hour,al gaxy founder and ceo, mike novogratz joins us. we'll be right back. ar. we're all rock stars. oooo look look at my data driven insights, i'm a rock star.

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netflix is set to return earnings later this week. the stock up about 80% in the last year. joining us now, all things media, including the drama at para paramount, is rich greenfield. rich, great to have you with us. i do want to start off, this is a stock you don't directly cover, but your firm does, live

nation, which is seeing a pretty dramatic decline pre-market on this report from the "wall street journal" that the doj is preparing to sue live nation, the owner of ticket master. what are your thoughts there? some analysts out there who think that a lawsuit will probably not materialize, particularly in an election year, where the city administration wants to court younger voters. what do you think? >> look, my partner, brandon ross, covers live nation. he's been all over this issue. our top '24 predictions for this year, we had live nation being sued by the government. this is, assuming happens, melissa, this is certainly not a surprise. i will say, and i think you've seen this from many other cases that you and the "squawk" team have debated over the last couple of years, this administration has pretty spotty track record on actually winning lawsuits. just because they sue doesn't mean they win. and in they go after is discreet business practices, i think the stock is going up a lot. i think that would actually be good. it would lift the cloud that's

been over this stock. i don't look at this as a negative. i think the drop you're seeing this morning, brandon and myself would look at this as a meaningful opportunity to step in and take advantage of this dislocation. >> all right. let's move on to netflix, rich. and i'm curious what you are looking for, specifically in this quarter. it seems almost like it's netflix's world amongst the streamers, and everybody else's to lose. >> i think you nailed it, melissa. that's the right way to think about it. i think what's changed over the past 12 months, you've talked about the stock performance. what's changed is everyone is pull back. you're seeing reductions in spending, everyone is trying to get to profitability. i'm not talking about netflix, but all of the streaming competitors are realizing streaming's really hard. and their losses have piled up. you know, peacock has lost $7 billion, paramount plus, $5 billion, disney, probably $8 or $9 billion. these losses that have piled up are enormous. so as everyone pulls back, they're cutting back on content

spend and marketing. netflix just essentially holding their overall content spend flat is actually widening the gap. so you're seeing a lot of fresh content on netflix, far more so than what you're seeing on competitors. and that's you're going to see in netflix this quarter, continued solid improvement in subscriber numbers, and really, more and more of an advertising story. i think you'll see them talk more confidently about how their ad business is progressing. they're gearing up for their second up-front presentation in may. and i feel like there's more and more momentum. you have amazon entered the advertising business with prime video over the last couple of months. and the cte ad market for those top two players combined with what google seeing with youtube, there's a lot of momentum there, and i think you'll hear a lot of that on the earnings call later this week. >> rich, everyone is always talking about consolidation in this business. paramount is in the headlines, tl there's always a sense that warner brothers and discovery

could want to merge with somebody else now that this lockup, but change in tax status would allow for a transaction of some sort. but at the same time, if you look at either the transactions that are being pursued right now and others, "a," there's no consolidation going on, and "b," it's unclear to me how much consolidating would help anybody meaningfully. so if you're a buyer in this market, how much you think the consolidation really helps you accept for maybe some savings. but the question is, how big are the savings? >> well, andrew, let's step back. i remember you had that, you know, seminole moment where you were interviewing zaslav on stage at deal book, and you think about sort of, how has consolidation really impacted this sector? viacom merged with cbs, stock is down a lot. you know, you look at time warner, warner media merged with discovery, stock down a lot. disney merged with fox. stock is down a lot. like, it's not clear that consolidation is fixing the problem. the problem is, linear tv

business is facing stiffer and stiffer -- >> that's what i'm trying to say. everybody is sitting around going, well, if i move this chess piece and merge my chess piece with another chess piece, i'm somehow going to save a fortune. >> the market is telling you, cost cutting is not a growth strategy. if your top line is declining, you don't have a good business. >> bingo. so what do you do? >> if i look at what your parent company seems to be doing, if i think about comcast, you wait. you try to outlast. you have a much stronger balance sheet. you know, look at the situation paramount is in. look at the -- you know, while warner brother has done an incredible job cutting its debt load, the growth -- the trajectory, investors are obviously very worried looking at the stock price and what happens to the nba, and where do those rights go. so i think if you're sitting there at you know, comcast, you're probably hoping to outlast some of the competitors. maybe that's a better strategy than actually trying to merge. i know everyone likes to say,

just merge peacock and paramount, and magically, you have some incredible service. i'm not sure like, spending all of that money to acquire another big media company with all the other stuff. like, if you could just get,, you know -- it's just not so simple. and again, most of these streaming services don't have a lot of time spent, so putting two services with not a lot of time spent doesn't fix the problem. you really need to figure out how you lessen overall competition. and maybe some players were just not meant to be in this business. we keep urging paramount, why do a merger? just change management, change strategy, follow the sony strategy. it's working incredibly well for s sony. i'm literally shocked no one has replicated what sony has done. they're laughing ing all the wa the bank. >> rich, always great to see you. thank you. >> thank you. it's now a little after 8:00 a.m. on the east coast. you're watching "squawk box" right here on cnbc. i'm andrew ross sorkin with

melissa lee. joe and becky are off. a lot of ebig stories to tell you. bank of america and morgan stanley both topping first quarter analyst estimates. and mike johnson outlining plans to put four national security bills on the floor, including aid for israel and ukraine. the house has not acted on a nearly $100 billion bill that the senate passed two months ago at this point. and "the wall street journal" reporting that the justice department is preparing to file an anti-trust lawsuit against ticket master parent, live nation, for allegedly undermining competition in the ticket market. and that stock tanking on the back of that news. we're going to talk about it. futures right now pointing to a positive open across the board. the s&p looking to be up by 11. the nasdaq higher by 32. meantime, treasuries, we are seeing yields off of those highs that we saw on yesterday's session, but still evaluated. 4.636% on the ten-year. let's get to dom chu with a look at this morning's market movers. >> big bank earnings season in

focus, as andrew just mentioned. things are winding down for the big bank earnings season, but both bank of america and morgan stanley are reporting this morning. bank of america, which is america's second most valuable bank is up just about 0.1%. morgan stanley, america's most valuable investment bank is up roughly 2 to 3% at this stage. with help from things like better than expected net interest income, or the money it makes net from lending activities, as well as a 35% jump in investment banking revenues. for morgan stanley, the top and bottom line beats were helped by better results and not just in investment banking. one of the biggest drivers of the early market action specifically in the dow that melissa mentioned is united health, which is higher by 7.5%, just about 160,000 shares of volume. that's pretty much driving the entire gain in the dow this

morning right now in the extended trade. this is america's most valuable health insurance company. most heavily weighted stock in the dow, it beat quarterly estimates for profits and revenues, helped along by s strength. united health detailed the profits were hurt by 74 cents per share during the quarter, because of the impact of a cyber attack on its change health care unit. so overall, a big mover higher for united health. and we'll cap things off with another dow component in the news, and that's aerospace and defense giant boeing, which is right now up fractionally, just about one-half of 1%, 20,000 shares of volume after falling a percent along the rest of the market sell-off yesterday. now, boeing is defending itself in its safety, testing, and quality control processes for 77 dreamliners and 777 model jets, refuting claims being brought against it by a whistle-blower engineer, who says the planemaker took, quote, shortcuts to speed up jet deliveries. boeing denies those allegations calling them inaccurate and says

it stands behind the safety of the planes. the company speculate saluted t earnings next wednesday. it's likely to get a lot of investor questions. so andrew, boeing shares up half a percent. i'll send things back over to you guys. >> meantime, by the way, i don't know if you're seeing this, really quick, i want to get to bitcoin, but truth social out with a statement, sarah fisher from axios just putting out, planning to launch a streaming platform. >> streaming what? >> according to them, the streaming content expected to focus on live tv, including news networks, religious content, family-friendly content that has been canceled, at risk of cancellation or being suppressed on other services. . >> sounds like they need a lot of money to do that. we were just talking about how expensive streaming is in general. >> that it is, but nonetheless, that stock is now moving a little higher this morning maybe on the back of that news. meantime, bitcoin slightly

higher this morning. right now you're at 62,878. this coming after iran's attack on israel that sent the cryptocurrency lower. joining is galaxy digital ceo, mike novogratz. it's great to see you. we've been talking about it now for the last two days, and even over the weekend, what precipitated this drop and how folks should think about bitcoin specifically in the context of being either a safe haven or a hedge against inflation or whatever you think the thesis is for bitcoin at a time when it has not held up in the midst of what you would have thought would have been the moment it would have. >> you can always look at really myopic eyes with price action and try to read too much into it. the reality is, bitcoin is started the year at $42,000 and we're at $62,000, so it's one of the best-performing assets. saturday, iran attacks israel.

the only asset that's open is bitcoin. people are very long risk assets in general. stocks, crypto, other things. and so the natural reaction is to go to the safe, and safe still globally dollars and t-bills. right? you're seeing the dollar rally. the other bigger -- >> but isn't the dollar not supposed to be safe. isn't the whole point of bitcoin is that the dollar is not safe? >> well, listen, in time, it isn't, right? look what we're doing now? we're going to vote today to spend more money on wars, right? president biden is slipping in more money around the supreme court to pay off student loans. we have -- >> well, neighbor, but the point is that it appears that when things are bad and people are scared, they buy dollars. >> when things are bad and people are scared, people with leverage want less leverage. and so they take where they have leverage and they sell it. it's why stocks are going -- look at the nasdaq chart, it does not look good. >> yes, but the whole point of bitcoin, and we can roll tapes

of you and i having conversations for the at last five to eight or more years about this, that it's not supposed to be correlated. that's the whole point of this exercise! >> listen, and there's not one asset in the world that is not correlated all the time, right? what happens is, portfolios grow and a in new piece of information comes up and they want to have less risk. and when something has gone from 40 to 70, there's a lot of risk built into it. lots of money pours in and animal spirits take over. you have to wash out those animal spirits. >> can you tell from the flows how much of this selling is a function of folks who are actually selling the underlying

versus those who are playing in this new world called the bitcoin etf? >> most of the etf buyers are buying for the first time and you have these nine companies sellinging to bitcoin investors. er so most of those are hobblers. this ecosystem system has been around since 2009 and really in earnest since 2017. there are tons of ways you can get leverage in crypto and that lynch builds up when people feel good about the space and it gets w whacked and you saw over $1 billion of leverage. it's not big hedge funds coming in and selling on saturday

night. or institutional investors coming and selling on saturday night. >> part of the flight from bitcoin and over the weekend might have been that the asset rallied ahead of the halving, which is happening in just a few days on the 20th of april. i'm wondering if you think that much of the rally, unlike people will point to past having and what happens no bitcoin in the wake of past halvings. this time around, people know that already. has the rally already happened in your view? >> i said this the last time i was on and the time before, after a huge move, most likely, the next chapter is price consolidation. and i had said, you know, 57-70, we're still broadly in that range. i think that range holds. i think we end the year higher. like, a lot of the big platforms haven't even started selling yet. they had to wait, they had to have a season with approvals. so you're seeing these platforms that are just going out now to

their investors. and so i really still believe the baby boomers have a lot more money to put in this. and i just don't believe either candidate is going to come out as fiscally responsible. like, we have a 6.5% budget deficit in a year where inflation -- i mean, inflation, all inflation indicators are pointing back high, higher. we've got broadly full employment or close to it, and a pretty robust economy. we have a robust economy partly because the government can't stop spending money. so that story doesn't play well for assets, for inflation in the long run. looked a gold and silver. i think gold, silver, bitcoin, copper all end the year much higher. >> i guess where i'm at -- and by the way, it may very well be that bitcoin is going to go much higher, significantlyhigher. i don't know, but the reason i've been asking these questions is, i feel like -- i hate to say it, i feel like you're telling me the sky is green to some

degree, because we have these conversations all the time about the thesis behind bitcoin. you're talking about spending zp and inflation. that hasn't gone away. if anything, it's gotten worse. you think the war will escalate and we'll spend more money. >> we went from seven fed rate cuts to less than 2, right? so if you think about it, that's chairman powell raising rates, right? there's no other way to think about it. and so when the central bank is raising rates, it should -- it's shocking these assets aren't lower. it's telling you how much demand there is, when the macro story should be pushing assets lower. people are saying, what are we doing here? why is powell talking about cutting rates when he should be at least holding them steady and talking hawkish. what do you think the gold chart, the cyrilsilver chart, t copper chart, the oil chart is saying about central inflation. and we have a fed that's at best

wishy-washy and still talking about rate cuts. you've got to hold this all in context. this has been a rate rise, which is shocking how strong the stock market is, how strong assets are. why? because they're not as strong -- they're higher in dollar price, right? the dollars -- >> here's the piece i don't -- look, one last thing, we talk about -- first, you said, it's correlated to the stock market, but then snot, it's not correlao the stock market, because on monday it went up quite material on the back of the idea that this war was not going to escalate. and has not moved in the same direction. >> but in the morning when the stock market was on the highs, bitcoin was back unchanged, right back to 67,000. the stock market closed pretty poorly yesterday, and i bet you it closes poorly today. right? >> yeah. >> so if the stock market was open on saturday night, the s&p would have been down 2 to 3%.

it would have, right? there was lots of fear, is this going to escalate into a real war, is one of those missiles going to get through and blow something up? >> i agree, but the question is, why isn't bitcoin back at 70,000? >> it did bounce up and people sold again. people are very long, and you have to work through the overhang,. >> bitcoin became the number one story other than nvidia this y year, right? look at its performance. that draws a lot of people in. and in all markets, you wash people out and the trend continues again. >> mike novogratz, it's all good to talk to you and learn are from you and try to understand what's going on and we'll continue having that conversation with you. >> coming up, we'll talk about israel's potential responses after it thwarted an aerial attack by iran over the weekend. retired four-star general david

petraeus will join us. >> and we'll get march housing snarts next half hour. the dow looking to be higher by 221 points. stay tuned, you're watching "squawk box" and this is cnbc.

welcome back to "squawk." israel's military chief saying the country will respond to this past weekend's attack by iran, which included drones and missiles, though it is now unclear when such a response could come or how strong it would be. for more on this, i want to bring in retired four-star army general, david petraeus. he's the former director of the cia and chairman of the kkr global institute. good morning to you, general. how do you handicap this situation and what do you think the u.s. should be telling israel right now? >> this is an issue on which

where you stand depends on where you sit. if you sit in washington and you're worried that this could cause a spike in oil prices that could have a damaging effect on the global economy in an election year, then, understandably, you would like to see restraint. on the other hand, if you were in tel aviv and jerusalem, and you've just been attacked by iran, directly from their soil for the first time ever with several hundred drones, cruise missiles, and surface-to-surface missiles, even the fact that your defenses were superb, and noting, by the way, that about a third of these were knocked down by u.s. central command capabilities and some more by other members of this coalition that helped israel, but they would see this, they would have a need, they believe, to show iran that this is just not acceptable. and the debate in the war cabinet, of course, is how should they do this without causing an escalation further in the violence between those two

countries and the proxies, who also shot -- >> if you were advising them on the answer to that question, you would tell them what? >> depends where i'm sitting. if you're in the war cabinet, you see a need to respond. i understand that and talked to a senior member of the israeli government yesterday. if you're in washington and you're concerned that this could have a damaging effect on the global economy, then obviously, you're looking for restraint. i tend to be more with the israelis on this. i think that they do need to respond, it has to be a bit performative in the way -- there's a whole range of options. it could be something very significant in cyberspace to attacks on the drones where the missiles were launched. >> it would be performative meaning you would do it, they would see it, and that would

deter them from further action or then that it would escalate and how should the war cabinet in israel be worried about the threat of escalation? >> this is the threading the needle aspect of this. how do you something that is punitive, visible, but not so punitive and significant that the iranians feel a need to respond in kind. noting that the iranians believe that this chapter is over and they will say, well, it started when israel killed the two very senior members of the r revolutionary guard of the quds force in the annex to the iranian embassy in damascus. that is a threading the needle operation that has to take place here. and i think that's the reason why they have not yet taken action. that's the essence of the debate that they are undertaking. and it's not certain at all when is it that they'll resolve that. they don't have to do it immediately. and as they think through this -- but i think there does have to be some response from

the israeli side, given the unprecedented nature of what iran and its proxy, because they're also -- >> do you -- >> do you view what happened over the weekend from iran as perfo performative? meaning, there clearly were warnings made in advance. it appeared that israel and its allies, including the u.s., were ready. i wonder what would have happened, frankly, had. everyone not been ready. >> well, it's a very good question. again, there is a threshold level of considerable readiness at this moment right now between israelis, u.s. central command, other allies engaged in this. but, yes, they telegraphed this well in advance. everyone was absolutely on alert. the issue here, though, is that there's no guarantee that the defenses were going to perform as magnificent as they did. and had they not, these could very well have killed sizable

numbers of israeli citizens or forces. so iran took a chance in that regard, this is not unlike the response that they made on the u.s. base in western iraq in the wake of the soleimani, the former head of the revolutionary guard quds force. where they launched a number of missiles, significant, but certainly didn't kill anyone. there were a number of concussions, but they telegraphed that well in advance as well. that was several years ago. >> what kind of relationship do you think at this point the biden administration has with netanyahu? >> well, i think it's been strengthened enormously by what took place over the weekend. as i said, reportedly a third of what iran launched and some others from other locations, we even took out some missiles and so forth on the ground in yemen. that commitment is very, very significant. >> but if it was so strong, biden told him, what we understand from the readout of

the these conversations, take the win. it so may have been strengthened, but to what degree? >> there's no absolute amount of influence when it comes to a sovereign country that has just been attacked from iranian soil. again, for the very first time so there does have to be a response, and it's difficult for those, one ofr the other, to appreciate fully the perspective of those in jerusalem, washington, london and elsewhere. >> general petraeus, always enjoy speaking with you. thank you so much for your perspective on this. >> great to be with you, thanks. >> thank you. coming up, which defense stocks could see an impact from the latest tensions in the middle east? we'll speak with a top aly.nast stay tuned, you're watching "squawk box" on cnbc.

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microsoft will invest $1.5 billion into a united air ram emirates space known as g-42. as part of the deal, microsoft president brad smith will join g-42's board. but the deal is a bit unusual. both the u.s. and uae governments appear to be involved. in a statement, microsoft noted that both countries are committed to complying with the

ai and trade and business laws. they have come under scrutiny in the u.s. for its links to china. republican u.s. representative mike gallagher represented that g-42 works with china's military and intelligence services. g-42 has denied those allegations. in the meantime, we are approaching march housing data, but ahead of it, we are looking at a higher open. as we mentioned before, the dow futures really took a turn with united health's better than expected results, better than expected on the top and the bottom lines, but more importantly on the medical loss ratio line. the dow looking to be up by 181 points right now. s&p looking to be higher by one. the nasdaq up by about 1.4. so a reversal from the past couple of sessions, where we have been under pressure because of geopolitical concerns. treasury markets, though, we are still evaluated in terms of the yields, although off of the highs that we hit yesterday, although we're right up there on the ten-year. 4.65% on the ten-year yield.

>> and we have jay powell speaking a little bit later this morning. >> yes. >> we'll see what he has to say about all of this, plus potentially the number we'll be getting in about 15 seconds from now. >> exactly. >> we already had san francisco fed president mary daly y yesterday saying there's no rush to be cutting rates here. we have a number of firms saying, some things to the effect of goldilocks, that narrative that there's a goldilocks scenario in terms of the economy. goldilocks is dead. but we'll see. steve liesman is here with the numbers. steve? >> just getting the table now. it looks like a real big beat -- miss to the downside. 1.3 million units versus an expectation that was expected to go down, but expected at 1.48, zpaed comes in at 1.3. that's a 14.7% drop. permits also down. they were expected to be quite a bit higher. expected to be about consistent

with where they were about 1.51 from 1.52. but it came in at 1.4 or 5. let's see if we can figure out where it was. single-family home starts down to about 1 million from 1.11, 1.2. and multi. family down to 299,000. this is, by the way, all at an annual rate. we would expect some decline in the multi-family. that has been very strong and have been cutting back there. let's see if we have an idea where this happened. every region, northeast down 36%. midwest down 23%. the south down 18%. only the west was up 7.1%, by region. so. not making much progress in the effort to build more homes in this country and fill the massive and lingering deficit for home values. but trying to think about the best course here for the federal reserve in housing and almost every course it might take would be negative for it.

i can't figure out -- first of all, let's talk about the balance sheet. they want to get rid of these mortgages. they have a lot of them. if they ultimately end up selling --t they'll do this ove time, but doing that would end up lifting mortgage rates. some stability in the fed would cut mortgage rates. but do you want homes to be more affordable right now? >> no, i thought we did not? i thought we didn't? >> first of all, apologies to the -- >> who are struggling to try and buy and find a home. >> there's also the mobility trap? >> the mobility trap? >> the mobility trap is real. to those who would already own a home who would otherwise want to move, those who are either locked into a 3% rate mortgage or less. nobody is giving that up. they could be not moving for years and we could be talking about a decade or more that's the thing and what are the ripple effects, the impacts on the economy if there is no mobility the way there used to

be. >> i wonder, to some extent, work-from-home might be offsetting that. you have the ability to not have to move to have and hold the job, which is limited. obviously, for some jobs, but some possibilities and others. if you sell a home, you still need a place to live. so that doesn't really help pch >> but rents are coming down a little bit. >> a little bit. diana olick, my deguru on all o this, she sees 7 as this watershed or rate too far kind of idea. when it comes into the 6s, it loosens things up. i guess the one way to think that would be good is a rate as opposed to the one that the fed is pushing up. so i don't know how this -- >> i don't think people are selling. >> but how do you --

>> how do you get them to sell? >> they're not going to sell unless the market -- it has to be within 1 or 2% -- the mortgage rate has to be within 1 or 2% of the current rate that they have. >> for the economy -- >> do you want -- >> you cannot have a 3% difference. >> do you want the housing market -- do you want that activity to be spurred again? don't you want it to be restrictive in some way? >> i have a personal interest in this, but i would like young people to be able to go out and afford a home. that to me seems to be a basic kind of goal for economic policy. >> but if that's the case, you need two things. >> policy is not delivering that, we need to figure out and get policy right. >> you don't have this problem. your kids are young! they're 20 years from owning a home. >> you need, "a," sellers, just pure -- >> right, sellers. >> people who are even willing to sell. >> you need inventory. >> you need inventory. >> that's the inventory issue. but to get to the inventory issue, you need lower rates, because otherwise, nobody is going to create a the inventory. >> what happens with lower

rates? more buyers, more prices, less affordable. >> lower rates also, inflation -- >> i hear you. >> nobody has come forward with the solution here. and the worst part about it is, the home buyers and home sellers are the ones probably most taking it on chin from fed policy here. >> by the way, on the weaker than expected housing starts, we are higher in terms of the futures. the s&p looking to be up now by about 10. the dow looking at 237. >> okay. >> we can solve it, guys. we've got to go to break, but we didn't solve the housing problem. >> we will, eventually. coming up, boeing set to be in the spotlight again on capitol hill. we'll talk about tomorrow's whistle-blower testimony and the painful april that the stock has had so far. u' wchg quk x"ndyoreatin"sawbo a this is cnbc.

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a boeing whistle-blower set to testify in the senate tomorrow. that individual filed a complaint about questionable manufacturing practices surrounding the 787 dreamliner. boeing is down 11 straight sessions. joining us now is ken herbert, rbc capital markets aerospace and defense analyst. great to have you with us. >> hi, good morning. >> if boeing had a call yesterday, basically saying that they don't believe that any of these claims are true. they've run the gamut in terms of maintenance checks on a lot of these jets that are in service and they haven't found any issues. what's your take on how this is weighing on the stock? >> so, a couple of factors.

this is certainly weighing on the stock, you know, in the near-term, on the back of everything that's happened with the 737 max. and obviously, all the other issues at the company. it's certainly weighing on the stock from that standpoint. our view is, there's other issues, probably around production rates and max and management transition and other items that are weighing on the stock, as much, but certainly 787's critical. we don't think that this fundamentally is a long-term risk to the story on boeing, as it relates to 787 right now. but certainly, one of the factors that's weighing on the stock. >> what is your rating on boeing right now, and how do you see this plagueying out, for peopleo are holding the stock right now, what's the hope here. what are potential catalysts? >> yeah, it's a great question, we're outperform rated on the stock. we do think a couple of key catalysts coming up first, on the risk side, when they report their results in a week and a half, i think expectations are relatively low, but it will be, in our view, an opportunity where management will provide

more of a, you know, clear the deck so to speak, in terms of setting expectations this year. and that's around production rates on the max, around free cash flow. but again, we think that's largely expected by investors. i think bigger picture is you're looking at a management change here in the next few months, potentially with an announcement. and that's by far the most positive catalyst. we do also think that there's significant opportunity with the resetting now of production levels on the max, and some of the efficiencies, we should be seeing out of the factories at these lower volumes which should help with execution in the second half of this year and in 25 and 26. >> it so sounds like you're sort of expecting a kitchen sink sort of quarter in terms of what their guidance might be, but when a new management, when a new ceo comes in, we should probably expect some sort of a kitchen sink again, i would think, that's what typically happens when a new ceo takes over. so, it sounds like a very bumpy ride ahead for your outperform-rated stock. >> yeah, a lot of volatility, we expect over the next few months,

but we do think, to your point, when we do get a new management team, there is likely a kitchen sink approach. and the important thing you can remember, obviously, that would be expected. but whoever steps into that role will have a significant amount of support, in our view, whether it be from the regulators, the politicians, the customers, both on the commercial side, and on the defense side, suppliers. everybody wants boeing to succeed. boeing, it's important for the united states for boeing to succeed and we think the sentiment will give whoever steps into this new leadership role significant runway to execute what we think will be some of the tough decision, and ultimately reposition the company here, to benefit from what is a very strong demand environment, across both the defense and the commercial portfolio. >> ken, thanks for joining us. appreciate your time. >> great, thanks, have a great day. coming up, we'll talk more about the fight in washington over aid for israel and ukraine. things like they're starting to move in congress. after a break, south dakota senator mike rounds will joining

us. but first, johnson & johnson beating estimates. ceo jeff wolf joining us roonlt on the show. here he is responding to a question about whether he's as optimistic about the rest of the year as j&j's first quarter results might suggest. >> if you listen to and look at some of the clinical advancements we've had, we'll give our scientific teams every opportunity to accelerate those opportunities even further and some new ones. it's a matter of being early in the year, maybe looking for that opportunity to invest to again fortify the future, as opposed to being negative about anything on the horizon. again, the first quarter was very encouraging to us. we are optimistic that we will hit the quarterly or the annual guidance that we provided in january.

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from our team of mobility experts. because we believe the more ways we all have to move forward the further we all go. welcome back to "squawk box." take a look at futures right now. we are pre-session, pretty much highs at this point on the back of the weaker than expected housing starts data that came out 15 minutes ago. s&p looking to be up by 15.

dow up by 290 right now, and the nasdaq higher by 44. >> following last week's attack on israel, mike johnson highlighting a plan to put four national security bills on the floor. those include bills on israel aid, ukraine aid, one including more sanctions on iran, but our next guest says that the house should vote to approval a nearly $100 billion package that the senate passed in february. joining us right now is mike rounds. he served on the armed services committee, intelligence committee, and banking committee. good morning to you. you may very well be right, but it doesn't seem to be what's on the table right now. >> no, you're correct. right now, they're looking at four separate bills. the question will be if they can get them out this week, and whether or not they combine them into a single bill to make it more efficient in the senate to actually get something done. as you know in the senate, the process is designed to slow things down, not speed things up. and each bill under what we

consider to be the normal way of operating, any single member can stop the process, move forward, and delay the final determination on each bill. so if you can do that on just one bill rather than four bills, you have a better chance of getting it done in a timely manner. so, yeah, it would be great if they can combine them into one bill, skand we could discuss th, amend them. >> but senator, let's walk through this. let's say they pass aid to israel, but they don't pass aid to ukraine, or they pass aid to ukraine, but don't pass aid to taiwan. and they decide to package up whatever combination of these things comes together. and then they hand it to you. what does the senate do? >> i think the senate's been pretty clear. i think we had a 70-29 vote that we wanted the pack that included aid not just to ukraine skisrae but also taking care of some real issues in the pacific rim

region with regard to aukus, and finally some humanitarian aid as well. the package was in good shape coming out of the senate, it was bipartisan in nature. that's the one that we wanted. if the house, though, and they have their privileges as well. if they want to try separate it out, we haven't seen what's in each one of the four bills yet. we will by the end of this week, then the senate will have to respond. my suspicion is that we're going to do best we can to get it back to as close to as what left in terms of substance, as what left the senate in the first place. >> one of the things that was in one of the house bills back in november, if you remember, was the funding for israel, but it was offset by cuts to the irs. how would that go over if in fact, that comes back in this? >> yeah, look, i think the whole process here is what can pass in a bipartisan manner. and the way that it came out of the senate, we had bipartisan support. if the -- i mean, once again, this has not passed the house yet. and it may very well take a

bipartisan vote in the house, in order to get it passed. so rather than right to figure out what they're going to accomplish in the house, i think they're going to have to come up with something that they know will pass on a bipartisan basis. it's divided government. and the republicans, we control, somewhat, we have somewhat of a control in the house, not a lot, but some. and in the senate, it's still a 60-vote margin, meaning you have to work on a bipartisan basis. and so, that's the hope here, is that cooler heads prevail. we come up with a plan that actually takes care of the needs, and for the messaging and so forth, the frustration we've got with the irs and so forth, and there's a lot of it, that may have to be a battle we fight another day. >> senator, talking about loading up this bill with other issues, there is some talk about loading it up with a forced divestiture of tiktok in this bill. of course, senate commerce committee chair maria cantwell, i believe, opposes the house's tiktok bill. i don't know if you think the tiktok bill would change in the context of this?

>> yeah, we don't know the way that they'll craft a new bill, but most certainly, there is broad support to eventually eliminate the chinese government's participation or their ability to get into and in on tiktok. i can tell you that tiktok has been used to manipulate public opinion in other countries, but a bigger concern for us is it's also a way for them to learn a lot about western culture in the united states and elsewhere. this is something they like for their large language models with regard to the databases that they collect and they need. they've got large databases on their own people and their own culture. they need more of it on western culture. that's one of the reasons why we have a concern with the collection of data and the use of that data or the availability of it to the chinese government.

>> senator, the rationales for force ag divestiture of tiktok seem to be different by so many different folks in the senate, in congress and the like. nobody seems to agree -- they may agree they want to get rid of tiktok or they want it to be sold, but some people say it's a perspective problem, meaning they're collecting data now that could be used later on. they are potentially given the size and scale of it, they could do something in the future. that's a perspective issue. you have other people saying they're actually doing something now in the moment. it's unclear -- i don't think it's been reported what that actually even is. why is there not a consensus on -- if there's a consensus on divesting tiktok, why is there not a consensus on what the facts are? >> well, there's two parts to it. everybody has their own opinion about what is the most important. in the senate we're fairly certain, i think we can fairly

well show the manipulation they've been able to do in other countries. we also know very clearly in a very short period of time they were organizing and activating a lot of american citizens to make contact with members of congress when the consideration was in the house about whether or not they wanted to actually limit tiktok's ability to do business in the united states. that's a matter of understanding and i think everybody saw that. the part that i'm adding and the part that some of us that work within the intel community and within armed services is the need for the chinese communist government to be able to gather additional data, have access to the data they collect, not just to manipulate, but to learn and to educate their -- to actually impact the artificial intelligence systems that they're working on desperately right now. you have to train those systems.

if you train them using only the eastern cultures and only the information on their own people, then there are biases that are built into that. if they can learn and take a huge amount of data out of tiktok, they learn who our kids are, who they associate with, who they're connected with, who their parents are, where they go to school. they learn who they're associated with and who their families are associated with, where their parents may work, what they do for a living. all of that type of information comes back in and is collected. and when they want to access it in the future, they can. >> senator mike rounds, thank you for joining us this morning. appreciate it. we'll see what ultimately happens in the house this week and what lands on your desk or not later this week. thank you. >> thank you. when we come back, some top takeaways from this morning's slate of bank earnings and the overall message so far from financials. take a look at treasury yields

right now this morning. the 10-year sitting at 4.645, the two-year 4.942. futures ahead of the market open -- still have close to 40 minutes -- dow up nearly 250 points higher. we're coming right back. and retirement savings. voya helps you choose the right amounts without over or under investing. so you can feel confident in your financial choices voya, well planned, well invested, well protected.

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joining us is ken leon director of equity research at cfra. we're seeing trades higher. let's start with morgan stanley which is the bigger gain so far premarket, almost 4%. do we not care about the ongoing investigations into how they gather their assets for their customers, et cetera? >> it's great to be with you. certainly we're watching that. we don't want to see this be something systemic. hopefully it's a one-off and it doesn't damage the great brand that morgan stanley has in wealth management. the performance was excellent like goldman, but equity underwriting was up 113%.

i think the story we'll be talking on cnbc this year is that was all coming from the corporate side. but for the blackstones, kkrs, there's a trillion dollars of equities that have to be released because their limited partners want to see those before they do new fund-raising. that will be very positive for morgan stanley and goldman. then, of course, as you look to bank of america, it was disappointing. it was almost not their finest hour. net income 54% of net revenue was flat. we saw deposits and loans flat. credit card income, one of the best franchises in the industry at flat card income even though transactions were up 9%. the only areas bank of america did well was investing banking, trading and also wealth

management. i think bank of america will come back. brian moynihan, ceo, they always come back. i think the morgan stanley call of 930 will be interesting because we have ted peck, a new ceo. we get back to your first question in terms of what do they think about the federal government investigating their wealth business. >> right, especially as wealth mana management, as you mentioned, the assets fell. there's weakness there. just quickly, ken, in terms of bank of america, how concerned are you at all about the health and maturities portfolio they have as rates go higher? >> it's a good question. as an analyst, it went up slightly to $118 billion, the high northwest the industry. their deposit base is $2 trillion. so this is not anything that would be alarming as we have the bank prices from those small banks last march. >> ken, thanks so much for your analysis on the bank earnings. we do appreciate it.

a programming note here, do not miss an interview with bank of america ceo brian moynihan later today on the closing bell. futures looking much higher, 240 points higher on the dow, s&p 500 up eight or nine points. the nasdaq up 25, 26 points. melissa lee, thank you for hanging out all three hours. >> join us tomorrow. "squawk on the street" begins right now. good tuesday morning. welcome to "squawk on the street." i'm carl quintanilla with david faber and mike santoli. cramer has the morning off. futures once again on the hunt after a 3% drop for the s&p, worse than in more than a year. dow will benefit from unh. our roadmap begins with market volatility. six negative sessions in a row. nasdaq coming off its worst day