good morning stocks are set to plunge again after the worst day for the dow since october of 2020. we'll show you what is moving. overnight, the steepest selloff in china since on 2020 and the onset of the pandemic. covid has been spreading there undetected for a week. plus, twitter reconsidering a new report saying executives are in talks with elon musk and warming up to his takeover offer. it is monday, april 25th, 2022 "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 rebecca quick along with joe kernen and andrew ross sorkin. look at u.s. equity futures. if you were hoping for the relief from friday declines, check this out dow futures indicated down 268 points after losing almost 1,000 points on friday that selling late in the session. the s&p right enough indicated down 35 points the nasdaq off 92. in terms of friday selloff, it was the worst day for the dow since october of 2020. the dow fallen for four straight weeks. check things out look year to date for the markets. you will see it has been steep declines nasdaq is the biggest loser. down 18% from the all-time highs set this year.

s&p is down in correction territory. dow down 7%. if you are looking at treasury yields, the flight to safety tre treasury yields have come down slightly 10-year yield at 2.83% 2-year is yielding 2.6%. 30-year at 2.89% this all comes on concerns of growth that has been the story. andrew >> absolutely, becky let's talk about it. stocks in china selling overnight. beijing warning that covid spread undetected in the city for a week more cases could be found with investigation. the city's main business district started three days of mass testing today all in-person group activities have been suspended. schools remaining open, but restaurants, gyms and non-essential businesses closed in a small portion of the

business district. joining us to talk about it is cheri kang from hong kong. what are you seeing? >> reporter: good morning, andrew certainly reports of panic buying of groceries coming back into the headlines covid is leading to the plunge in the shanghai composite. down more than 5%. biggest one-day drop since february of 2020 that is the onset of the covid-19 pandemic. it is closing at the 2,928 covid situation in china not getting better and getting worse. the market fear is that it could actually lead to lockdowns beyond shanghai and the lockdown in that city is dragging into its fourth week already.

the next city could be beijing that could be the explanation for the oil slump we have seen on monday. in the oil district in beijing, people were ordered to have three tests this week. more than a dozen buildings on lockdown in the market, we saw yuan closing at one-year low versus the greenback. some economists are saying watch what happens with the meeting this week. the china's highest decision making body meeting. look for any clues for stimulus. remember the stimulus so far announced by the authorities are not meeting market expectation in hong kong where i am, hang seng closing lower deeper selling for the tech index down 4.8%. guys. >> chery, some papers are

talking about the possibility and conversations and i don't know what level about reevaluating the zero covid policy is that in the offing? >> reporter: you know, that's actually not the first time we saw that report. suggesting that maybe authorities in beijing could give up on the zero covid policy this is something that was applied to hong kong as well i'm glad to tell you things are opening up a little bit. little by little here in the territory as well. perhaps it is moving in the direction. that's exactly the reason why we need to watch the meeting as well if things get really bad and it is hurting the global demand and if the chinese authorities think the growth in that economy would be taking a big hit, perhaps things are loosening up. if you look at the example of

shanghai, it is a tough call to make at this point because the l lockdown in the city going into the fourth week as we speak. >> chery kang, thank you joe. secretary of state blinken and secretary of state lloyd austin visitings ukraine in kyiv to discuss military aid with volodymyr zelenskyy. officials pledge more than $700 million are in financing to help ukraine and other countries involved in the war. i don't know what an embassy presence looks like, but reestablishing the embassy. >> doing that and making trips from poland into the country eventually setting up in kyiv again. that's a big move. watching the pictures from this play out obviously it had been leaked by

president volodymyr zelenskyy. he talked about this previously. they went ahead with the trip. that is a very big deal in terms of showing up and saying yes supporting this regime in france, their polls are as bad as ours president macron defeated marine le pen in the runoff election. his victory speech, macron stated many voted against her to keep her out of power. he addressed the french living standards are slipping still worth it you are living in paris. >> or anywhere in france >> pretty much in the meantime, a source tells cnbc that the twitter board met yesterday to talk about the elon musk financing plan for the bid musk secured $46 billion in the

offer. twitter was expected to shoot down the offer and gone as far as the poison pill to defend a hostile takeover the twitter executives are in talks to sell to musk and could finalize the deal this week. this reversal comes after musk met on friday with several twitter shareholders to make his case for proposproposal the former chair jay clayton will join us at 8:30 a.m. eastern to talk about this andrew, the board has a fiduciary responsibility to run down any offer a real offer with financing to back it up is one they will obviously have to discuss. >> i'll tell you, one of the things and we'll see whether we end up getting to a finale here where the deal gets done part of the reason the board wanted to talk to elon musk and necesgotiate with him is to do their fiduciary duty, if you

will it is hard to say no and walk away from it completely. having the negotiations and see if the price can come up and obviously elon musk said this is a take it or leave it deal in the market where tech stocks fallen, twitter remained there are interesting questions of the pricing issues and then the issue of free speech and influence and all that the other piece of this over the weekend as you saw elon musk with the comments of bill gates going after him and ripping him. by the way, from the conversation i had with twitter people over the weekend, it bothered them. you believe this is a place where -- you can say that is about free speech at one point >> it is not the worst thing on twitter. >> lots of terrible things are

twitter. >> when gates was on, he went through a litany of investments. i said about what shorting tesla. he said i don't discuss my investments. i said you went through the litany of the investments you do make now you won't talk about it? he must be shorting tesla. >> he said bill told him that. if this is verified. >> i think there is a different question this is a different question of the price itself, but you may disagree with me on this >> probably. >> i think elon musk is a role model for better or worse. my kids love elon musk a lot of people love elon musk. >> i love him more now >> to make those comments about it whether it is bill gates or anybody else what you think the platform will

be -- to bullying people >> my whole love has grown i watched him switch from the climate change god to more people don't like him because he's mean. like the last guy with the mean tweets he is too big to fail. he is worth enough you can't cancel him that i admire. >> there is a question of civility if you believe this is an app and platform with civility -- m maybe you don't want role models >> we all have different views of role models woke, cancel culture, politically correct people are not my role model. >> i don't like my kids seeing this. >> shethey see a lot worse >> if you are cleaning up twitter, you have to do more than ban musk.

back to the deal back to the proposal his bid for twitter. the one thing the board said and i think it is interesting that they like a break-up fee if the deal doesn't go through, they get paid for going through it going back top original filing i can call the deal off for anything i can decide tomorrow not to go ahead. if they accept the deal and move down the road, they would like certainty the deal will not disappear overnight. that is worthwhile to ask. >> i think the question is how big that will be we haven't figured out and he hasn't made clear to them whether he is putting up all of the equity or go in with thoma bravo. there are a lot of questions the longer-term debate, it is not about the price, but all about the other things. >> it is an inflection point

it has sparked conversation. we have more coming up on "squawk box. when we return, futures pointing to more selling ahead of the opening bell we have a rundown on the events for the trading day ahead. crude prices falling sharply. we talk to helima croft at 6:30 a.m. this morning. you are watching "squawk box" here on cnbc >> announcer: this cnbc program is sponsored by baird. visit bairddifference.com. voya provides guidance for the right investments. they make me feel like i've got it all under control. [crowd cheers] voya. be confident to and through retirement. ♪ ♪ connecting to opportunity is just part of the hustle. ♪ ♪

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time now for the "squawk planner. investors waiting for another huge week. we while hear from coca-cola and visa and boeing and caterpillar and mcdonald's activision is reporting after the bell the week belongs to tech stocks. ce center stage starting alpha debt and meta and amazon on thursday. and all of this with twitter reporting on thursday with the

musk deal pending. we have learned that there was a board meeting yesterday to discuss the musk bid it could provide an update this week we should mention, a smart point that jim cramer made, the price of meta and we will see the earnings this week it has fallen. that may put pressure on the board of twitter it is unclear if the price held up otherwise on the economic front, we get the latest estimates for new home sales tomorrow. gdp numbers on thursday and consumer sentiment on friday joining us now to break this down is alicia levine. head of equity markets at by mellon good morning of all of the things on the do docket and layer on what is happening in china, what is the headline and which way will it move the market?

>> you can't escape the fact what held up on the index level has been large cap tech and names you talked about reporting which will be the first thing to tell us where the next leg is for the s&p. for the most part, these names have held up and on support and have not collapsed as other parts of different sectors absent huge blowout earnings, we are at risk here we have pce data at the end of the week inflation data which is what the fed uses that is another impact here. if pce keeps on moving higher, it doesn't look like it is flattening or rolling over it will be another leg down for the market it is a very difficult week ahead of us. that is why you see the selloff last week and futures down this morning. a lot riding on this and so far the argument has been in favor of the bears that's what this setting

investors on edge here. >> mimi, bull or bear this week? >> i'm a optimioptimist i have to say. i think next week the earnings are extraordinarily important. the early indications earnings last week, the early look is beating by a small bit by 9% this week and next week are really important we are coming into this time period with the really strong economy. i guess i'm more of an optimist. >> would you buy ahead of the earnings or big faang stocks >> we're under weight equity right now. we are short duration. we closed our under weight in fixed income and concentrated our positions in the front end of the curve where we think things are more fairly priced here we are not looking to catch a falling knife, but we are

looking at some of the value in the tech stocks which have been beaten up extraordinarily. >> it doesn't sound so bullish under weight equity doesn't sound like a bullish take. >> a little under weight equity. i think we are well positioned we are over weight real assets overall, risk assets are neutral. >> alicia, what would you be doing? >> it is interesting i sound bearish. we are equal weight equity we pulled back from emerging markets nine months ago and developed europe we feel in this cycle it is too tricky to get this right we expect a stronger dollar. when the dollar is stronger, things break in other parts of the world. we need to think about the difference between what happens to the real economy as a result of the fed actions and marching forward quickly and what happens to financial assets. those are two different things it is plausible to have things

break in the financial market glo globally think about the yen and yuan and euro and pound in the last three months a very strong dollar does not bode well for the world and multinationals and earnings. i think we're seeing the beginning of the dislocation from the fed's policy. do i think the u.s. economy can muddle through this year yes. we do not have a recession in the cards for the u.s. this year that doesn't mean the market will take it that well vix is near 30 this morning. it is high i think that you have to wait here to get through that meeting next week of the fed to see what some of the verbiage is out there. she spooked the market with the 75 basis points which is consistent with what happened in '94. that is the fed's road map here. >> i want to thank both of you you either of you crypto owners

or crypto curious? bitcoin dropped at 38,500. joe, what can katie stockton say last weekend once you break 38? >> she'll be on and some of the things she said is a lot of things have broken down. i imagine the thing she said would be 27 is the next support level for bitcoin. i don't know whether she'll say it is violated the 40,000. it seems like it has i don't know everything else certainly has. we know they are related we will have that on you knew she was coming on that was a very good foreshadows for what we will talk to her about shortly. shortly. we have mike wilson on, too, who you got to admit if you look at the dow chart and s&p chart for

the year, that is what mike wilson said. >> mike has a note out that we will dig in with him harder to hide as the bear gets grizzlier. we will hear from him. >> this is not yogi. this is something worse. >> we should thank alicia and mimi i did not do a proper end to the segment. thank you. joe. >> coming up, earnings season rolling on wilith we withl hear from coca-cola at 7:30 a.m. eastern. first, gabe plotkin. he will star in "american greed. changing course and apologizing to clients forget everything i did. i need new pfoerrmance fees. apologizing to clients details next

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welcome back after encountering backlash, gabe plotkin plotkin hscrapped a plan for fees. his investors are sitting on losses the fund taking a big hit in the meme stock rally you may remember investors out 50% where they bought before january of 2021. the message to investors yesterday and plotkin said i'm sorry i got it wrong i apologize. plotkin said the fund would take two or three weeks to assess before coming back with another proposal of the fees should or

should not be. sounds like they should not be anything for quite a long time >> make us whole >> i did not know the gamestopers and everybody was mad at him i was saying that is ridiculous. i was in the commodities business the idea you take a performance fee after you are under water and start over is outrageous that is the reason i said it they are all cheering it on. this was the guy that they were trying to squeeze for being short. he actually said he would reestablish short positions. everything he could have said to make that whole class of people angry again. >> it doesn't matter what matters is what investors think. they are ticked off. >> some investors and some are out now. you remember ken grieveffin and

steve cohen said he was one of the greatest investors of his generation lots of questions. investors from one generation. becky is about to talk about the true investor of -- >> are you catholic? >> yeah. >> yeah, it reminds me of confession rape and pillage and plunder no, no such thing in money management i'm glad we have it in catholic sdp catholic >> right berkshire hathaway will have the shareholder meeting in o omaha. warren buffett and charlie munger will be on stage taking

questions. it is not too late if you want to get questions in. send them to berkshirequestions@cnbc.com. again, that email address is berkshirequestions@cnbc.com. head to cnbc.com/brk llive22 you can see all of the pre-and post meeting shows. when we come back, we will talk about the slide of crude oil prices with helima croft a decline of more than 4% and this is coming as there are concerns about the global economy. lockdowns in china and beyond. we will talk about all of this when we come back. as we head to break, a look at the s&p 500 decliners in the pre-market

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good morning welcome back to "squawk box" live from the nasdaq market site in times square. check out the futures. down 300 dow lost on friday everybody finally realizing rates are headed up. 50 is a given at some point. 50 basis points. you are hear 75. we had jeremy segel on last week, becky. he agreed with the idea that you have some time of, i don't know, infection. whatever you got something that can knock it out pe

pen pencillian instead of zap it right at the start and if you know there is a problem, the incremental way of doing it might make it worse >> that is an interesting point. for mary daly to say 75 is not out of the question. >> to get there. interesting stuff of how much people are getting to switch jobs that is where you think wage/price spiral. that is how it happens prices go up if you need it. there is a lot involved with people out of the labor force and not coming back. a lot involved if it costs more to bring them in, that's going to trickle through everything as well you can ask jared bernstein. are you happy? >> did you see elizabeth warren talk over the weekend? >> i saw other stuff. >> idea of inflation

if the democrats don't address the inflation problem that it means they will lose the election she is coming down on saying this how do you address it? some of the things she proposed means price increase >> the idea -- she's in corporations which chase profits. it causes inflation. >> i will say carlos gutierrez joined us. this is an era of leaders who had not had to deal with inflation. you deal with it by raising prices based on what you think is coming. that extends inflation and gets you to the point where it is a self fulfilling prophecy >> spiral. >> spiral. oil prices are down this morning. look at this $97.75 brent down 102 that is a decline of 4% as well.

joining us to talk about this is helima croft at rbc capital markets. inflation is here and we are watching it push higher. energy prices are down based on less demand around the globe we have seen the shutdowns in china. is that responsible for the pull back >> the china story is the main driver for the pull back perhaps the shanghai lockdowns were easing and then what happened over the weekend with the erection of the building clo enclosures the story about oil. i think if we had news of the lockdowns in china were easing, prices would move higher we hhave to get past the china story. the other story is with the election of macron and france. the story is will europe implement sanctions on russian

energy they have been refusing to do that so far. >> what would that mean? do you think that really happens? macron won very handily. obviously le pen picked up more than she did last time she ran against him. he is also dealing with an understanding that he has a little bit of a fragile coalition. he has to pull from the right and left and do things differently than he has to this point. >> macron had come out talking about bans on oil and gas which is harder to replace i do through the direction of travel is so form. they are starting about smart sanction s which could punish russia the question is how is this war waged? if we get to the situation where they escalate and more mass

atrocities and if they move to using chemical weapons, you will see not only europe essentially say we will embargo russian oil and that's when you have secondary repercussions. that implies a secondary sanction which would make it hard for india which is backing up the truck and taking that $30 discount and turkey saying we're not going to take russian barrels. barring those sanctions, the market is going to focus on what is happening in china and interest rates and even the spr released announced earlier >> helima, one thing i'll warn with this is, look, these governments may take this seriously and trying to send serious signals to russia, but they are dealing with inflation. we know it is a problem here and in the united states we are not dealing with any of the inflationary pressures with energy that europe is dealing with it is a milder issue here.

>> absolutely. >> it does make you wonder part of the reason that macron had a close election is because there were people who said the inflation was getting out of control and french people just can't have that same standard of living if you are worried about that and worried about keeping that fragile coalition together, maybe it takes away resolve for doing these things to that extent >> becky, this has been the number one issue in it terms of europe's response to russia. they say we take half of the ar. how much economic pain are we enduring for the principle you will not invade a sovereign country? if they are intent on reducing ukraine by taking the south and east and going after port cities like odesa and then in bucha with the mass atrocities

god forbid with the nukes or chemical weapons, the response will have to be tougher in sanctions. it will have to think about what is short of war response if you are using chemical weapons it comes down to questions about what is russia willing to do in waging this war in ukraine >> there's complicated issues to man maneuver what happens with coifevid in china? what would you say in terms of where you think energy is headed over the next three-to-six months is this a new watermark or the new standard what do you think? >> i think we will see volume ty volatility i think i am more bullish on oil because of what we have seen in terms of how russia has behaved in syria i think we are likely to see the war get worse. we are likely to see it

intensify with sanctions response united states and europe don't want to engage militarily. they have to respond with tougher sanctions. >> we are heading into the summer driving season which means more demand here what should consumers expect to pay at the pump? >> becky, what is interesting is the largest spr release in history. we had this big concern of covid lockdowns in china yes, oil has fallen, but we are still talking about $97 wti. the concerns as we head into the driving season, we should look for elevated prices. we test the levels at $109 and wti is realistic we could go higher based on the sanction response to russia. >> helima, thank you good to see you. >> thank you coming up, stock futures pointing to more selling ahead of the opening bell.

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another 300 points so far added on to the selloff from friday in the averages where we lost almost 1,000 dow points. another 300 this morning nasdaq down 117. s&p down 40. just under 40. treasuries are still below 2.9% now. down 2.814%. bitcoin is down under 39,000 38,500 coming up, more on the twitter board p meeting over the weekend to reevaluate elon musk te tender bid former s.e.c. chair jay clayton will join us next. "squawk box" will be right back.

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twitter re-evaluating elon musks now that he has $46.5 billion in financing the two met on sunday. there was an interesting day in the markets. all of this is reported in "the wall street journal. joining us now s.e.c. chair jay clayton, he's a cnbc contributor and the lead at apollo a lot has changed since the last time we spoke, jay you do think now the chances are increasing that elon musk ends up with twitter? >> well, lots of people are handicapping the probabilities here, joe, but last time we spoke, we identified a whole list of uncertainties about this, what actions various people would take, the conditions to the bid. and what you are seeing is a

direction of travel where those uncertainties are being addressed. there are many to go, but we've seen financing be addressed. we've seen due diligence taken off the table. you've seen the board of directors do what board of directors do with a bill and order and process around this, and, you know, the market is taking stock, as you've noted, how shareholders and others feel about this there's a direction of travel from uncertainty and trying to eliminate the uncertainties. there's obviously a way to go, but that's where we are. >> you can almost see it in the stock, i guess, trading up 4% on friday it's up again today in a down market, and yet it's still well below what the cash offer would be so that -- i guess that's a faye

market check for what the probability is at this point that he succeeds. >> yeah. i think that's fair. one other constituency that we talked about that people will be keeping an eye on is regulators and where the regulators will come in on this, including the s.e.c. and the things we talked about around the section 13 filings, the 13 d and the 13 g that's another thing to keep an eye on as we continue forward there. >> do you have any friends telling you what's going on or are you surmising what's going on are they still so angry or involved with looking at what they think are things that elon musk has violated certain things in the past? are they big enough to where they'd try to stop this? >> no. i have no -- i have no special knowledge. >> you have no friends.

>> no friends. >> do you have friends anywhere, jay. >> friendless. tough world out there. >> you won't have a lot of twitter, i can tell you that much you're laughing. i don't either i don't want any friends on twitter, to be honest. >> it's a good thing. >> yeah, it's a good thing. >> jay, fiduciary question to you. given that twitter is a delaware company and we have lots of conversations these days about various stakeholders, the business roundtable statement many years ago, how they were to take into consideration employees and customers and the whole gamut, can they really in the context of a transaction like this? >> well, andrew, i think, you know, look you have your duties to your shareholders here in delaware. you know, i caught a little bit of the program you guys were correctly identifying that one of the things the board is doing is evaluating this offer versus

continuing as an independent company, also evaluating whether anybody else would come in but more granularly evaluating whether the transaction can be one that's more certain including talking about breakup fees and the like. and that's -- that's what the board is doing here, evaluating this versus the alternatives you know, all we have is the reports in the pape e butit seems like they're doing what you would expect them to be doing here. >> jay, i guess the question i'm asking, are they allowed to take into account -- for example, i know because i talk to people inside twitter and around the board. there was a genuine frustration this weekend with this poking -- sort of immature poking at best at bill gates not because it was bill gates but because there was a view of, oh, my goodness, this is going to be the owner of twitter. yes, we all want free speech,

but is this the kind of beige that will work long term and actually be good for the company as a company but also good for society? >> well, andrew, let's put it this way a perspective of the shareholders and the public shareholders of twitter is going to be paramount in the boardroom. these issues of the moment you're talking about, of course, they're there. but they're not going to carry the day. >> the board right now and what they're thinking, when they're talking and deciding on their different concerns as board members, what do you think is going to take precedence and there's a lot of cia, and there always is with boards, right? they have to consider shareholders, they have to consider, you know, regulatory issues, due diligence, all that type of stuff. they cannot blow this off in a

market this week for check stocks, jay. there's just too much risk in doing that >> look, joe i'm a believer that boards generally do a very good job around these things. i expect there's a lot of rigor assessing value, assessing certainty, assessing the market generally, you now we get to pick and poke at them, and we should. in america, you know, you scrutinize people who have been put in jobs, but my view is what do directors do in job situations like this. >> jay clayton, thank you. good to have you on this morning. i would consider us friends. so if someone says who are your friends, you can say joe kernen says he's a friend becky? >> that's a good start to the week, joe. >> becky says you might want to

k keep that to yourself. thanks. >> thanks. coca-cola results, we're going to bring it to you in a moment right after this. dave doesn't need a posh virtual receptionist, because he cloned himself. while his clone watches the phones, dave can work on his code. and lead his team. dave trusts his clone like he trusts himself. so, in summary, we're going to sell the company. who's in favor?... perfect. but if cloning isn't an option for you, just get posh. virtual receptionists who can answer and transfer your calls, because you can't be in two places at once.

♪ welcome back to "squawk box" right here on cnbc i'm andrew ross sorkin along with becky quick and joe kernen. i want to show you the markets we're going to open down perhaps in a big way we have a selloff taking place the dow off about 240 points the s&p 500 off by about 230 points and nasdaq off. this is about china and covid pushing stocks down. look at the ten-year it had, of course, been higher when we were flirting really with 3% at one point let's show you oil this morning. we're looking at wti crude as we flip the board around, standing at 97.82 we're looking at cryptocurrency.

we're sitting at $38,411 doge coming off 6% ripple, 7%, eth, 4.5%. now we're going to kick off some earnings news for coca-cola. here with that news is sara eisen who joins us with more sara. >> hi, good morning, andrew. coca-cola put out a great number, at least on the quarters on the bottom line, 64 cents a share. a huge number. coca-cola seeing that number in at 18% so very strong sales, very strong earnings, and they are keeping their outlook intact but i did just get off the phone with james quincy, the ceo he sounded very cautious he said it was a great quarter, but, quote, the storm clouds are gathering on the horizon they kept their guidance intact

because they feel confident about their strategy that's working. that includes stepped up marketing and innovation they've had a few new cola flavors that have gotten a lot of buzz. but things have gotten complicated on everidy mention the consumer is not going to endlessly swallow inflation. yes, coca-cola has been through business cycles before it's resilient, but clearly there are headwinds and inflation is one of them china is another one china in this q1 went negative, he said, despite what was a strong start to the year but the lockdowns in shanghai are proper lockdowns and they're hal halting mobility on russia, there's a decrease.

they didn't have to adjust on currencies he said they're mostly hedged on the major currencies actually latin america is a great business for them. as far as inflation clearly coke is feeling it like some of the other companies, but he said it's not in other commodities where they're certainly experiencing it like corn syrup, but it's in logistics, trucking, cost of media, general costs, wages, all of that, andrew, influencing the outlook. but they did not adjust the numbers. they feel there's a wide set of issues given some of those headwinds and the fact that coke is consumers spending across the

world, he sounded more cautious. >> thank you thank you for that insight, taking us behind the scenes a little bit with those numbers. becky? >> thanks, andrew. there are some suggesting even that might not be enough steve liesman joins us with more on this. this is the big question how much is too much >> or how much is enough, becky? markets focusing on an enormous amount of race hikes here. a policy rate seems to actively affect economic growth there's ample uncertainty whether this new hawkish outlook will be able to deal with inflation. we think fed rate hikes will need to slow u.s. growth below potential gdp growth estimated

around 1.8% and also increase the u.s. unemployment rate a bit from here if they're to make a significant headway in reducing inflationary pressure. you look at the fed rate outlook. there's some declines in rates here's how you get there 50 basis point rate hikes over the next three meetings and the markets pricing in some chance of a 75 bp hike if there and then 25 basis point hikes over three meetings with some chance of a 50 bp baked if there. it will be the fastest the fed have done in any single year since the '80s the fed may have to go further becky, check this out. i was doing a little history here in december of 2021, the fed itself forecast a medium fun j

rate this year i have never seen anything like this and it's extraordinary that we're still having this debate as to whether even that accelerated pace will be sufficient >> here's the question i have. is it enough or will it be enough the fed announced it's doing this and they could still go too far. there's two sides of the market, is it going to be enough or too much the second is does it matter because the fed's kind of dragging them there. >> you know, becky, i know there's this idea out there -- i want to address the second point first by gunld ladlach follows two-year

i'm not sure that's the case i hate to debate the guys that manage all this money, but when i look at it, i think the fed is bringing the market with it. >> just with the jobawboning, y mean >> yeah, with the jawboning. you look at december t minutes came out and all these different points the market seems to jump after those points it looks to me like the fed is jawboning the market. >> that's a fair point jawboning itself may be a huge part of it. >> and there's this idea from bullard, which is actually the only optimistic part of this whole discussion bullard says we've come a long way. look at the two-year where we priced it around 260, 262 or so. you know, maybe in that case if you look at the 340 built into the november fed funds, maybe we

have another to go we've done a bunch of it and it's restraining the economy now, but the debate whether it has to go above or further e that's the one that's the consequential one. it's impossible to say right now. what i do think, if i think the chance of 75 basis points are low for the first two meetings to come. after that, we'll take a look at the summer and perhaps see whether inflation has had any response at all to what's going on with the fed and the economy. and then if it's not, the fed may resort to 75s at that point. >> there's the scary scenario. steve, thanks. we'll see you a little later. in other headlines this morning, twitter reportedly in talks with musk, they could decide on the proposal twitter was expected to turn

down his offer after musk said he lined up $46 billion in financing, twitter changed its stance and opened the door to a deal. gas prices are inching lower. the average price of regular unleaded dropping 3 cents to $4.26 a gallon that's still $1.27 higher the same as a year ago unless oil prices drop further, additional cleans are expected to be small or none at all. up next, the steepest sel selloff. officials in beijing said their code's been spreading the undie texted we'll take a live look at the report the futures right now, mik wionf morgan stanley will join us in a few minutes

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sparked by the lockdown in

shanghai, joining us , chery kang. >> toilet paper runs in grocery stores, this comes on the record of that number of covid-related deaths out of shanghai which is underlockdown dragging into the fourth week of lockdown and rising cases in beijing. so really the fear is the fast spreading variant omicron is making its way through china and the capital city of beijing could experience the shanghai-style lockdown. that is really the major fear as well of course, what really prompted this kind of market fears is the massive orders coming from a major district in the capital city of beijing. and, of course, this district is, of course, seeing more than a dozen buildings under lockdown

and many people, close to 3.5 million people in that district alone, are ordered to test three times this week. i'll send this back to you guys in the u.s things are track lower across the board in premarket action. and what i find in tring is e-commerce stocks interestingly enough, they're not even salvaged in the-off as well. they're all tracking lower this morning. back to you. >> chery, so much to think about. it's difficult to think about young people or people that could have dealt with it or even a better vaccine that's not the possibility so it's almost a completely exposed population, which puts it -- it feels like it's two

years ago compared to what we're facing here. the selloff we're seeing in the markets, for example, that's really the level of selloff for the market jitters that we saw yes, it looks ooh like the zero covid policy is in question. the real question is will chinese authorities relax its standard for covid looking at the example of shanghai, it doesn't look like it, and that's what the market is fearing all the stimulus promises delivered so far coming in a very much targeted way, and that means economic recovery could be slower than expected. >> okay.

c cnbc's chery kang now back to you. the russell 2000 is now down more than 20% from their most recent 52-week highs dow transports, 17.4% and s&p 500. and dow down 8% and 11% respectively from their highs. what do you do about this? stephanie link is a cnbc contributor. we've been having a bit of a selloff in part because of what we're seeing in china, plus we've got all these earnings this week and other data that's coming out how you do play out? are you a bull or a bear this morning? >> i would say optimistically they're going to continue to be good we've already had 20% of the report of the s&p 500.

75% are beating and they're beating by 5%. why it's so fortunate in this unfortunate situation is because we're hearing from companies real time about their business, about the outlook, and what i do want to see on a timeline like this, andrew, is companies who have reported already, good companies with good probabilities and good cash flow i have a list for you. ibm, schlumberger, american express. look at coca-cola this morning they put up rev nigh growth and 15%, 18% now's not the time to pang panic. we expected today to be rocky. in the last three years, we've had a total return of 28%. the long average is 10 so 2022 is the challenging you fehr all the reasons you're talking about.

>> we have a lot of viewers. we have amazon, the takeover from microsoft is there any big tech you'd buy ahead of the earnings right now? >> well, the one i have been buying a lot is apple. i'm buying that because of the ecosystem. we know there's a disruption with china but it's a compelling story and the free cash flow i think they're going to announce a plan. they can buy back their shares outstanding in the next two to three years. that's kind of interesting that's the one i feel the best about. >> so that's interesting

on the short-term basis, what do you expect you're going to hear from them? >> i think it's going to be a challenge for them, but they've been changing their sourcing for a while, right they've been trying to spread it out and not have so much dependence on their sourcing in china. obviously the demand side is going to be a question because they keep shutting down and opening this or that it's uncertain to step back and say this is a great product story, this is a great consumer product company and actually as it pulls back t valuation gets even more attractive i like the free cash flo, the balance sheet, what they're doing with their cash. i'm willing to take a little bit of pain in the short term. if they talk about weakness in china. >> final question, is there anything you want to get rid of?

>> i'm looking to upgrade my portfolio. i'm looking at starbucks something like mcdonald's. they have global exposure. i'm looking for companies that i know are going to deliver in the long-term. so to the extent i can upgrade my portfolio, that's what i'm going to be doing this year, you know, i've been more ambulanced between growth and value. i like what i own, and, again, looking for opportunities. >> stephanie link, always great to talk to you on this monday morning. >> thank you. twitter now, 51.40 now -- oh -- why 51.45 to 51.47 so that has moved up handily on words it could happen. it could happen even today, according to a report. we'll see. let's get a check on some

sectors. this morning the communication services industry hit hard, down 38%. the banking center continues to struggle it's considering continuing to struggle despite rising rates. the ishares of u.s. financial etf down more than 8% year to date, and here's the year-to-date health care sector. all sectors are now below their two-day moving average we'll be right back. your shipping manager left to “find themself.” leaving you lost. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description.

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twig moving higher just recently the company now said to be on track to reach an agreement with elon musk, possibly as early as today. and it's -- that confounds a lot of the skeptics, that's for sure, about whether this was a serious offer right from the start. i don't know whether that plays into what elon musk was thinking so you think i'm joking with the naysayers, but this has been faster than -- i don't know with the market as weak as it is,

especially technology, i don't know if that plays into it too 54.20 is besser than 24.20. >> the twitter board, i'm sure, has been out there to see if anyone else wants to lob an off. >> 5420. >> it's still 5420 all cash. >> i thought it was 47 last week. >> it was. look he's coming up with the financing. but it would be interesting. you have to agree not to step away from this they're obviously going to try to get more money. he said, no, this is my last and best offer. >> you know what else happened when you were out? i don't know if it plays into it you've got $250 billion, but a lot of it is on a stock that people question the value of all the time we have people come on all the time and question it then you saw those results last week from tesla, which, it's like, yeah, it might be worth a thousand or a heck of a lot more than a thousand when it's all said and done. i don't know

i would take a check from elon musk. >> you'd take a check and call it a day >> i would take it. >> would you wait for it to clear? if he was buying something from me, i would not wait for it to clear. >> no, especially if he was pledging equity. i would take that. >> no. i think he's good for it i think he's good for it. >> i think back to the issue that becky was talking about in the 6:00, the breakup fee is going to be a huge component of it, and obviously closing, simply closing the deal. if it's all cash, maybe it will, you know, close. it will be fascinating it's going to be one of the great dramas of our time we'll see what he does with it too. >> still to come, we're going to to be breaking down last week's market selloff with mark wilson and katie stockton a new note out from mike a little bit ago as we head to break, take a look

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let's look at futures. it's down. it adds to the declines of almost 1,000 points on friday. anyone looking for a bounceback this morning not getting it. s&p 500 down by a seventh, the nasdaq down 43 our next guest has been particularly bearish in recent months, and he's been right mike wilson is chief investor for morgan stanley harder to hide as the bear gets grizzly. >> yeah, good morning, becky unfortunately we're not seeing the low here yet you know, we're students of the market we respect what the markets are telling us as we've said many times, the best markets are the equities.

it's been telling us for months that growth is probably going to slow but it's been almost historic. what i mean by that, utilities and reits and health care, et cetera, have done extremely well as the expense of other parts of the market that's a strong signal, even in the face of rising interest rates. what we think is about to happen now, the s&p 500 has held up extraordinarily well under the face of where the average stock has been in the bear market for six months that's usually the way it works. last week's price action, i thought, was fairly ominous on thursday and friday where they had defensives going down and deep cyclicals like materials who were down. that tells me we're going into this final phase, which, the good news, the silver lining, becky, maybe we can finally complete this bear market over the next month or so at the index level when we get this thing down 20% that would clear the deck force.

>> when you say 20%. you're talking the s&p 500 or the dow? the dow's only down 7% for the year. >> that's right. i'm talking about the s&p for its high the high was close to 4800 down 20 would be 28, 39 hundred, which isn't that far that's about the halfway point, maybe more that would make us feel more comfortable that it reflects what the average stock has been telling us for quite a while. >> part of this -- you walked through some of. this you doge know where the next leadership is going to come from, and that's why you think we're setting up for this because when you can't look to leadership anywhere, everybody kind of pukes at the same time. >> now they're really expebsive. it's hard for me to sit here and get excited about buying defensive stocks when they're this expensive it's the market's way of hiding out, and eventually that will

give way once again we'll take our cues from the market if we had this decline. we're not sure we can't be certain of anything. but if we get a decline into may, june, then what we'll do is look for relative strength what things are holding up for the next stange of leadership. my guess is it's going to be a mixed bag. i don't think it's going to be one area or the other. it will basically see breadth improve. that's what we're hoping for we're not there yet unfortunately, and we have to be transparent with what we're seeing >> mike, in a typical market, a $43 billion cash offer for a tech stock that seems way above what it actually might be worth, that would be some good animal spirits, but i think that's a one off. this is the news of the day is what i'm alluding to, and elon musk has said it's not based on

necessarily financial metrics. is that a small positive for anything, or is it not related at all to valuations >> no, look, joe if there's a positive out there, i would say it's two areas of liquidity. there's still an enormous amount for buybacks and that's happening. the m arnold a has been quiet. that potential is still there. there's still a lot of dry powder that can come into this market, but i think you said it right iechlts going to do be more one off because valuations are still questionable for even the best assets. so i think buyers will be patient, but i think you're absolutely correct that's why we don't think it's a secular bear market. it's circular. once again we don't think that pitch is quite here. you bring up a great point

the money is still here. i expect more of that in the second half of the year. >> that was my follow-up so we get to 20% out of the way and you say it's off the table and then we can be back on i just wonder whether we're in a negative interest rate scenario trading range for two or three years or something i guess that would be a secular bear but you think we get it done in six months and then we'll be okay for some sustained gains after that >> yeah, joe as you know, we try to look out probably a little further than others i would say right now my base case, i do not expect a secular bear i think we'll finishthe move sometime this year, whether it's summer or fall that will set us up for the next leg of the secular bull market this cycle has just run hotter but shorter. i think the big question that remains is do we actually experience an economic recession

sometime next year i don't know the base answer is no. i think it could feel quite recessionary quite frankly, if we have an earnings recession, we'll have something to look forward to later in 2023. we're experiencing a classic cyclical bear here and we're having the finishing move probably in the next three months. >> hey, mike, we looked at the health care index a little bit ago, and it was down more than 3% that was one area, some of the big pharma and biotech stocks that you actually like it is still a place you think people can hide. why is that? >> we're being very specific there, becky health care is a very diverse group. you have similar technology. and so within the health care bucket we do prefer the more defensively oriented areas like pharma, like some of the, you know, services, names, particularly the insurance

names, basically the safety parts of that market, not the growth of your area. yeah, there was a company reported on friday not received too well that was weighing on the space. i do think the political pressure on the group has been, and if the midterms experience a more balanced congress, that may be diminished a bit. that's one of the reasons we're staying in the states. >> that's interesting. we appreciate you always coming on for us. thank you for being here, especially with these new thoughts, and we'll continue to check in with you as we ride this out. >> good to see you. >> take care. coming up, what's in store for the markets this week. and we're reading the stocks katie stockton will be with us activision blizzard, missing the top and bottom lines worth 38 cents a share

stock down this is really a microsoft play at this point. we'll talk about all that. plus, yes, elon musk edging closer toward owning twitter afr e eatethbrk. ♪ ♪ wow, we're crunching tons of polygons here! what's going on? where's regina? hi, i'm ladonna. i invest in invesco qqq, a fund that gives me access to the nasdaq-100 innovations, like real time cgi. okay... yeah... oh. don't worry i got it!

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welcome back to "squawk. twitter moving higher. the company is said to be on track to now reach an adpreem with elon musk as early as today. joining us right now is dan ives i have to say in advance if we get there, called this right from the beginning, said elon was not going away when at one point he said he was going away and getting off the board, and here we are. we should also note, dan, tesla shares moving down on this news. what do you make above >> you know, i think at this point, the deal seems based on the glide path to get done i think once the financing got put place in last week with the tender offer that's potentially a tender offer, the board could find a white knight, a second

bidder their backs are against the wall it looks like in the next 24 hours, musk will be successful in his bid for twitter. >> when you think about the twitter board in terms of making this decision, one of the things i've heard repeatedly is nobody seems to believe their stand alone plan, and nobody wants to have a situation, frankly, like microsoft/yahoo! mamany, many years ago, left at the alt tar are we going to look back and think it's the right decision, wrong decision, and how will it get measured overtime? >> look. ielt is a cinderella ending. it's not going to be all smiles. i think ultimately the clock struck 12:00

musk obviously hit it at the right time knowing they were vulnerable, but it comes down to the poison pill that give the board time to find a second bidder that's why this "game of thrones" really came down to this point that's why they ultimately had to come to the table with musk, and it looks now that musk will be the sort of third leg of the stool when you think about tesla, spacex, and twitter in terms of tesla's stock down, that's knee-jerk because of the view he'd have to sell tesla shares but as we talk equity financing, loose shares are more collateralized than perhaps sales, so that ultimately will get worked out, at least in the street's view. >> that was going to be my question tesla is one of the big decliners in the s&p 500 would you consider that a

buyings opportunity if you don't think about it because this fear of selling has been overdone they've laid it out pretty well, but no doubt it's going to be a knee-jerk reaction some will review it as trading caviar for $2 slice of pizza, you know, but viewers have a frustration view the twitter, the board, theylet matly had to come to negotiations with earnings this week, couldn't find a second bidder. now it seems like it ice on the glad path to get it done. >> that's it i was thinking of our friend kevin o'leary. you see five or six who have got this deal that the other five or six are like, are you crazy? they're like, do you want to do it who else would pay 54.20

you have to be bong kerrs. elon wants it for a different reason and he said it doesn't make financial sense do you think anyone else would be able to offer 43 billion right now with things the way they are you can't be a white knight. you'd have to be a looney. >> exactly from the private equity, it's a disaster, given the lack of -- >> people like money they like it when things go up. >> that's musk was doing that. give him the poison pill in time they can't find a white knight. >> we talked about this. but in the wake of what desantis did to disney last week given

their outspoken comment about politics in florida, if you will, i just wonder, is there going to be ramifications not just for twitter and tesla and spacex politicians don't like certain fortunatelies of speechful he was talking about all sorts of body parts when it comes to mr. gates. could you decide politicians decide to go after him, and what does that mean. >> clearly this. is a risk in terms of -- i'll call it a bulls aye on the back. when you think of tesla, spacex, regular touring in government, not just u.s. but globally, this puts musk in the fire further, especially the twitter platform. this is going to get that. in terms of tesla'sston.

what could be d ripple effect negative here, and i think there's more questions than answers here i think musk must understand the impact, but it seems like it's going down pento paper should happen soon. >> is there any positive for the company he owns. in you mind. then it comes down to musk's success. this is really going to be -- it's a polarizing issue because musk to some is a hero, to others, a villain.

now the fact that musk will own twitter, this is something many thought in a million years would never happen and finally, dan, do you short social or social truth >> look. musk owning twitter is bullish for twitter, and i think for any competing platform it's going to be tougher and tougher if there was any opportunity, it would be twittering floundering. now people will look at the more solidified platform. he just created 23% of his network on twitter. >> dan ives, thank you for the analysis as we said, dan's been right about this thus far, so i'm betting on dan today thanks >> andrew, would you trade caviar for pizza. >> heck, yes. >> i like pizza, as you know.

>> he says that. >> i would definitely. here. >> would you trade hot dogs? >> no, no, no. >> if you could get the caviar on the little pancakes, then it's different if we're just talking about the caviar by itself, not so much. pizza. mo oh, yeah. faus ray's any day i'm hungry. >> "squawk box" will be right back ening client confidence in you. before investing consider the fund's investment objectives, risks, charges and expenses. go to flexshares.com for a prospectus containing this information. read it carefully. hybrid work is here. it's there. it's everywhere. but for someone to be able to work from here, there has to be someone here making sure everything is safe. secure. consistent. so log in from here. or here. assured that someone is here ready to fix anything.

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last week was a tough one for the markets. the s&p down over 2% joining us now to take a look at the technicals across the board is katie stockton, fairlead strategies it's good to see you did enough things break down last week for you to change your near or intermediate term prospects? are we going to hit lower support levels of bitcoin and averages, would you say? >> yeah. it was a broad-based selloff of all risk assets. and the difference on friday was the defensive sectors mike was talking about. we saw a loss of momentum on a broad basis even in winners of the marketplacing and without their support, i think the market's going to have more troubles ahead unfortunately, the s&p 500 did take out the level we were

watching that was the risk metric that was 4340. we're expecting that breakdown to be confirmed today. that would retest the march lows which are more important we'll call it roughly 4200 that's a very, very key level for the market in that below that, the next support is around 3815, which is naully a decline none of us would want to link for and for the nasdaq 100, it's a bit more dramatic in terms of initial support, which is around 13,000 secondary support is around 10,600 they drop to the secondary support levels so we're billion really respectful of any breakdowns that do unfold without the leadership t upside from the mega caps, it's going to be a struggle for the major indices to come out of this. if anything there, coming in pretty oversold as discussed

but the breakdowns are pretty widespread. >> we hit one of our fundamental-type good ones mike wilson said 3800 he thought was where it was headed. that's personally in sink. would you say bitcoin violated the 48,000 support on a closing basis? it's 38.8. it got as low as 38.5. do you expect that to breach 38,000 like you said is that possible >> it seems very possible with that break of 40,000 we have one week below that would confirm this friday and another week closed. it's below the short-term support we're watching so is either, for what it's worth. if we see the breakdowns like you said it, the bottom drops out in terms of where the next support levels are for us, the 30,000 -- a lot of

us will focus on, that and yet for us, it targets to 27,200 for bitcoin. we want to be respectful of breakdowns irrespective of the asset class. of course, both bitcoin and either just like that, they have suffered that loss of long-term upside momentum which we knew at the start of the year was going to be a problem, and if we see these more major breakdowns, things will get worse. it will look more like a bear market move as opposed to a corrective phase. >> couldn't this give support to the bond market given that -- we know the fed has gotten more hawkish. i don't fe -- with what you're saying, it seems like it hold in terms of yield, or do you think we'll go right to 3% on the

ten-year >> the next resistance is that 3 1/4 level on 2018. but i think you make a good point in that the treasuries are much more oversold in relative terms than the equity market so folks may grav tate toward that as the better alternative at this point. we'll see things improve the s&p 500, we'll see a little bit of relief for them from their downtrends, and yet we would look at it as a counter trend, the same way as we look as it as a countertrend. >> thank you for the update. katie stockton, fairfield strategies >> when we come back, democrats are worrying about tackling issues of growing inflation. we're going to talk with a member of biden's economic

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good morning welcome back to "squawk box" here on cnbc we're live from the nasdaq market site in times square. i'm becky quick along with joe kernan and andrew ross sorkin. we saw this start on friday. late in the session, serious pressure that brought the dow down by almost a thousand points since october of 2022. that's continuing with declines about 235 points s&p futures down and nasdaq off by 21. it's not just here tough day for markets in china as well. beijing warning over the weekend covid has been spreading in the capital city for over a week and that is really seeing some extreme pressure with the shanghai composite down. all of that bleeding over not just to other markets, oil prices and beyond, but if you see what's been happening in

europe, took pressure there despite the fact that macron did win pretty handily in that re-election. you're seeing the cac in france down some are saying it was baked in. the ftse down and germany down. cnbc commentator mike santoli joins us now i know a lot of -- i don't know. a lot of damage, at least technicians think was done. >> yes pretty broad-based at least a pretty stiff task a lot of times you get a nasty friday a lot of people love to see an ugg open on monday not sure if this is ugly enough just yet the way it's setting up 42.22 was the intraday low late january. it's been sideways to down most

of the year, but it's been chopping around this range you had in the low 40s, 100, tra tra low of march we open up today, it's almost 1% down t take a look at the bellwether here very similar charts here you mentioned the technicians. you say, well, that's kind of a top there. although, arguably they're trying to maintain a little bit of higher ground that they've developed over the prior years we have alphabet earnings for this week. it's starting to look cheap for a lot of people. but we're in one of these phases asking if the leaders have to correct. apple, the big exception still katie stockton was talking about how some of the recent stronger sectors also have given back some of their gains pretty

sharply. take a look at energies and metals and mining. there are still uptrends you see the sharp drop the pullback has become a little more thorough, comprehensive, inclusive, broad sometimes that happens before the end of a correction that's about to be put in or as they're giving up. we might have to look at lower levels. >> we had mike wilson and katie stockton come up with the same number based on different methods. >> it's a neat 1,000 points off the high i know that's not how they get there. it would be a little more than a 20% drop. >> all right mike santoli, thank you. let's talk twitter because, boy, it feels like we're getting closer lots of reports now.

bloomberg with one of them this morning saying the company appears to be on track now to reach an agreement with elon musk as early as oday. a source told cnbc musk met yesterday on his proposed bid for the social media company i've been working some of the phones and texts in the past hour, and i do think we're getting closer with a real concern among the board that the standalone plan, given that there are no other bidders would not necessarily get them to the promised land. you think, let's get out of here, take the noise off the table. better to remove ourselves rather than fight another day, so we'll see. >> andrew, look. if you read between the lines on this, if they're doing this now

and saying it looks like it's cleared for takeoff and yesterday they were talking about his financing, it must mean that they're giving the stamp of good approval for whatever financing he's lined up we don't know exactly what it looks like, but they must have some confidence in it. >> there's the financing issue we don't know what the numbers are on the breakup fee regulators will look at this i'm sure there will be conversations. we'll, of course, allow it i'm sure people will come to the floor and say, look, we need to rethink antitrust here i think it's going to be a lot i think is going to be the beginning of a race rather than the end of one, but for twitter, it may be the end of what has been a decade long of almost dead money and lots of questions

about the strategy someone will one day write the book about twitter it's been written actually there have been versions and aza'll right the final version there's a fair way to say it. >> the tock up by more than 5% this morning, 51.46. not the 54.20 that he's bid, but obviously picking up quite a bit of steam on these reports. >> in the meantime investors and white house worrying about inflation. that's a big part of what fueled friday's selloff in the markets, which has continued into this morning and this week. federal reserve chair jay powell now says a 50-point basis hike is on the table at next week's meeting. joining us to talk about all of this is white house economist jared bernstein. he's the president's counsel

member of white house advisers the inflation picture is an important one, not just here but around the globe the question is what should the governors? >> what she advising the president when it comes to inplame. >> if you think of the economy and inflation we're experiencing as a combination of the demand and historically strong labor market, very solid household balance sheets, strong demand meaning insufficient supply, there are two ways to address. again, i'm speak about this from the perspective of the council of advisers. this is economic an all kiss our idea has been to bring it to a strong demand. how do we do that?

one thing we want to be sure is that the labor supply continues to grow. ice one of the most important variables in the economy right now and we actually have a very solid and somewhat underappreciated trend in that regard it's just a half point below its prepandemic level. we have the fastest growth in labor participation in any of the past five recoveries of course, that's out of a low trust. that's helpful there's or work in competition between industries, trying to help family budgets deal with these. do you the the wage inflation we even salaries peek >> are they going to come down or not >> when you have a labor market as tight as this one, i think what people might have missed

about a week or so ago from the bureau of labor statistics, there are 17 tats posting their lowest up employment rate on record that's going back to the mid-19670s boerks are going to have at the same time you've got firms with strong pricing power. as the hay ever demand increase. that's certainly comments you hear from fed chair jay powell also in a similar vein that's one way to understand those dynamics >> senator elizabeth warren was out yesterday on the talk shows and wts pretty vocal about things that they'll lose in the upcoming elections if they don't

do something about addressing inflation. i don't think there's a quarrel or quibble about this right now. numb be ber one on voters' minds right now. she said a lot of this is because of price gouging she wants to see the ftc is have the pow gore ahead and investigate and prowse cute "deal or no deal" played off and thinking authorities have the act to ability to -- would you -- >> let me refleect on that i've never been part of an administration who has tried do more to help working households

get by in a word of one of them. container wealth time is down 50% shelves are stocked. i mentioned labor supply shortage when you goat to centers of competition. snochl it's about simple econ 101. price levels are going to be higher an wee see. we'd like to see a lot less barrier to aen think this administration worked wut our record has provided $18 billion in student debt relief, reaching 8,000 people, those who

were funded by cljs, disabled who could chblt pay back their loans the sayway. we're doing the best we can to amile aureate that as well >> i wanted to ask you about elon milk. the white house has had a complicated with elon musk and made comments about the influence of billionaires in america over business and society. what's the white house view of a potential takeover >> there's no way we're going to comment on a specific deal like that, but let me take you to the issue of billionaires and white house. where you see our finger prints most present on that story is on a tax -- a billionaire's income tax. you know, i remember a number of months ago, you and joe were pressing me hard to come up with

a policy, come up with a policy to go after untaxed income derived from wealth. and, in fact, that's precisely what this white house has as a -- i think historically important proposal it's very. he only hits the top of 1%. it taxes unrealized gains. i think it's very much the spirit of where we're coming from there. >> jared, we know that's not going to to pass. >> i'm sorry i didn't hear you. >> we know that's not going to pass. >> i would definitely not be too sure about that. remember, we have a very active length lative team who works these issues before we put them on paper

>> meaning you think you do have the votes within your own party, that you've locked up senators >> it's a probability question nobody's locked up i would never assign zero nor one to that probability but i think it's a lot higher than you're putting it. >> well, okay. that would require that you get two senators from your party who have said no to this point are they in play >> if you actually listen to pretty much every senator that i'm thinking of, including ones who are more in the center of the democratic agenda, they've at times ben supportive of a wealth tax, a tax of the type that we're talking about. >> not on unrealized gains they haven't. >> you have to go back to the well and try to explain this is essentially a with holding tax on unrealized gains so that -- >> come on, jafrmtd withholding tax on unrealized gains is not a

tax. let's be clear about this. this isis money that's not come into play yet. this is brand-new tax. >> it is a brand-new tax, no question about that. it's a brand-new tax proposal, but with holding tax on unrealized gains, which is then used to pay those gains once they're realized seems to me -- >> what about -- look at the markets -- >> that's a great question with if the gains are never realized and the person's passes away, that's part of the step-up basis. let's say you're a share hold over -- >> no, no, it doesn't go way i say instead of a stepped up basis, those gaining would be -- >> joe nan chin is signing off of this or open to this? >> there's no way i can speak to

him. i'm give u you the economics of this our legislative team is working on this. i don't think its probability is as low as you think it is, but we'll see. >> andrew? >> just on another topic, corporations over the past several years have been speak. some have been supportive of those outspoken moments. i'm curious what the reaction was around the white house with desantis and this bill that is seeming i, think, to, at some level quiet disney. >> well, i don't know that i've heard the president speak to this specifically. he may have and i missed it. i'm not going to speculate there. it's completely legitimate for

corporations to be good corporate citizens, and this is something the pretty has talked about. he's talked about corporations playing a role here both in terms of price pressures and in terms of what we talked about earlier, not creating barriers to entry and industries where there's not enough competition, so i think it's completely lead imagi legitimate for the president of the united states to do that what it means, they're allowing competition in their industry, they're allowed to profess and follow any legal views that they think are appropriate. but it all means in the backs of their minds they're looking at what's successful. i think it's fairly consistent with what the president said about these issues. >> thank you for joining us today. i'm sure we'll have you back soon. >> my pleasure.

okay coming up after the break, mohamed el erian take a look at the futures we're in the red this morning ahead of a lot of numbers and some challenging news out of china overnight. the dow off by 218 points. 3sdaq up 16 points, s&p 500 off by3 points you're watching "squawk box" on cnbc

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with a 2-year price guarantee. call today. now back to this morning's blig developing corporate story. corporate reports say twitter is on track to reach a deal with elon musk. axios business editor dan primack. dan, good to have you on i'm sort of heartened that the board understands its role i don't know if you agree with me it's surprising how quickly this is happening, but the board is supposed to take care of shareholders do you see any other way the board is going to get this to 5420 on its own and if not, how can any of these other concerns they have become secondary to maximizing the value for shareholders.

>> they do become secondary. two things on, that joe. one, i understand the fed and what's happening with tech stocks the stock was well above this a few months ago it's not like it's unheard of for it to be above this. the second thing is the board is supposed to be a fiduciary to shareholders it has other stake holders to consider the thing that's most interesting to me about this is the answers we, you and i and those of us on the outside don't yet have you assume the twitter board has beyond that stock price. for example, who musk plans to put in charge of the company the board does have an obligation to its employees to at least know who's running the show because musk has said he doesn't like current management. it's hard to imagine he's going to become a ceo of yet another company. >> true. that could be an anyone but situation given -- i think things -- that's like -- you know, dan, netflix was $700 a share. it's been 700 on its own that doesn't mean anything under $700 is a good price for

netflix. it's nowhere near what it used to be. and things have changed so many different ways to sunday from where it was on its own. when do you think you could see market conditions that would put -- or corporate strategy that would put twitter back above 50? it could be five years from now. it could be five years from now. >> joe, it's about six months ago since elliott and silver lake came to this agreement to get jack dorsey out the door and put in new management. at the time, elliott's statement -- elliott said it was going to be a multi-year strategy that they were putting into place look, elliott clearly thought it could get there. it was going take a couple of years. i agree with you i thought originally the board was going to call elon's bluff on financing of this but it seems the other way around this deal apparently won't even have a go shop so when you say who else could offer more, i don't think twitter's board is going to find

out. >> i don't think there's anyone that would i call mr. wonderful, mr. nice guy, i don't know, whatever o'leary is he's really not that nice. maybe he's wonderful he's wonderful when we have him on as a guest. do you ever see when when person, one shark comes up with a valuation and the other looks at him like he's crazy and they go down the list and nobody else is interested at all in what's being offered. that's what i find interesting. >> by the way, joe, i agree with you, but, that said, it's interesting to me that musk was the one -- if the report is correct, musk was the one fighting the go shop if everyone was so confident, why did muffing not allow the go shop >> it's interesting. it's obviously not based on finance. the 5420 seems arbitrary when you have $2050 billion, you can do a lot of arbitrary things, dan, sometimes for amusement it seems like, but i

think there's a method to the music or madness deep down. >> you're right. the price seem as little bit arbitrary and this does feel a little bit -- i tons stakes are high because the twitter is so political to the discourse and local politics this. feels like a sports team purchase, right? >> yes. >> they say, that's ridiculous, but the guy wants to own the sports team. this feels the same to me. >> and those guys that did that, they had to be -- some of them had to be talked into it these teams are worth two and three times what they paid for it even though their arm had to be twisted maybe it will work out for elon. andrew. >> dan, i was going to ask you real quick wlarks do you think about the ftc. alina khan who's looked at it in unique ways, new ways, more progressive ways than before, clearly this is not a deal that would normally have any antitrust issues related to anything because elon musk doesn't own anything like, but do you think we get do some

larger conversation where this becomes like a billionaire influence story? >> i mean maybe except the thing you would have to -- or in any of the regulators would have to res well is the fact that even though it's a publicly trayed stock, mark zuckerberg has control of the empire as a single person. i do think this is one of those cases where the law, whether it be antitrust law or the regulation never quite anticipated something like this or at least it's not written for something like this. i'm not sure they have any tools in their toolbox to stop this if they were to want to. >> all right thanks, dan. say hi to all of our friends i guess you're in a remote location if you text people, say hi to all our friends at axios, will you? >> thank you. when we come back, much more on the markets with the futures down and the dow coming off its worst session in 18 months this morning's dow losers, we take a quick look. hopefully we'll be able to look at those there you can see.

chevron down almost 3% travelers, verizon, goldman sachs, and j&j -- j&j not really down much. don't go anywhere, paslee, or if you would, "squawk box" will be right back you do what you want

berkshire hathaway is holding its annual shareholder meeting this saturday, april 30th the meeting is going to be held in person in omaha, nebraska

it will be the first time it's been in person all the way back to 2019. cnbc is exclusively livestreaming this event warren buffett and charlie mung letter once again be on stage together taking questions for more than five hours and they'll be joined. shareholders, it's not too late to get your questions in send them in to berkshirequestions@cnbc.com. i'll get through as many as i can. again that's berkshirequestions@cnbc.com. we also have pregames, half -- pregame, halftime, and postgame meeting shows for all of this too. andrew >> absolutely. coming up, allianz adviser

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dow off by 220 s&p 500 off by 52, nasdaq off by 30 on friday the session had the worst in a year and a half now down the past 9 1/2. jonings us now is mohamed el erian, allianz adviser and queen e queen's college president. what do you think? >> look, andrew. here's a simple way of thinking about what's going on. last week was mainlying inflation, about the fed being behind, and the fed being in the midst of a policy mistake. that was last week those concerns remain, and this week we start with china bringing an additional growth concern, and we are now having both growth and inflation concerns that's why you're seeing not just moves in the equity market

but accumulative moves in the effects market and bonds market. >> how is that -- >> it's full-scale stagflation worries is what i'm trying to say. >> how does that change the conversation inside the fed? >> it won't change the conversation for this coming meeting. at this point, they have no choice but to raise 50 basis points their credibility is already undermined, and if they were to step back from a 50 basis point hike, it would be a significant blow to their standing and they would have enormous difficulty regaining credibility, but it will mean the marketplace itself is going to have to revisit this very aggressive part of hikes that is being priced in and asked the question, does that make sense as you know, i have felt all along that the market was going too far in pushing the fed to a hike by as much and as soon as the market was, and i think we're going to get a little bit of a revisit of that.

>> so you think that we're going to lighten up over time in terms of how the fed might react in which case you would think that would be a bullish sign for the market, no >> yes, but the fact is that we're changing the paradigm of financial conditions there is no getting away from that i've shared with you over and over again, we're changing paradigms, and the new pair dooim is a lot less supportive for assets in general. >> one of the things we've been keeping an eye on in the corner of our screen now is crypto, which has now fall been e low 40,000 closer to 39, closer to 38,000 when the morning began you know, we're all still trying to understand what that means. do you have any new way of reading the tea leaves >> no. it's the same old way, that when liquidity recedes, the assets

classes have been hit the most all have benefitted enormously from many years, andrew, of massive and predictable liquid ty adjustments we focus mainly oonz about risks, don't forget credit risk. that's what they're bringing on the table. credit risk. >> head fake or not when it comes to oil prices right now? the situation in china obviously is making some people concerned that actually, you know, there's going to be lockdowns and the like that creates all sorts of different supply shocks. >> yeah. i mean it -- >> and demand shocks, i should say, by the way, more importantly. >> it makes sense because now demand is anticipated to be lower, but the supply side is still a mess so oil prices are going to

remain incredibly vol title and remain relatively high, but we have now both supply and demand in a tug-of-war, and that's what we've seen in the last week or so. >> and we can't let you go without forcing you, frankly, to comment one way or the other on your take on elon musk taking over twitter you happen to be a twitter user, so i imagine you have a view. >> actually i don't, andrew. i really don't i listen to you guys and i learn from you, but i really do not have a view. >> no fun, no fun. mohamed, thank you. >> i have a view and it's important and people have to realize. in the inflation world, earthquake i thees are the least dirty shirt. you still are attracted to equities because they're a protection to anything else that's been soiled so much when you worry about inflation and growth, you're no longer the least -- the cleanest -- the least -- >> cleanest dirtiest shirt in

the closet, you bet. nice to see you. thanks. >> thank you. >> joe, is your shirt clean? >> every day every day. >> every day >> not my underwear necessarily. >> oh. >> if i so choose to -- he said no fun have you every -- i'm lying. have you ever heard the expression, all fat no -- like peanuts, all fat, no fun there's never really a reason to eat a peanut. >> they're good actually. >> they're all fat, no fun they are good. >> peanut butter p coming up, cramer, his first take on the continuing market selloff. we're coming off the dow's fourth straight negative week in a row and third straight for the s&p 500, and the nasdaq. stay tuned you're watching "squawk box" on cnbc

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♪ ♪ ♪ ♪ ♪ ♪ twitter shares moving higher this morning bloomberg reporting that the company is said to be on track to reach an agreement with elon muv musk as early as today it's currently trending on

twitter, number ten. r.i.p., rest in peace, twitter the shares of twitter picking up closer, more closely, at least, to elon's bid, elon musk'sed by of 5420. let's get down to the new york city and check in with jim cramer jim, i want to ask you not just about twitter. we'll get to that in a moment. more importantly, what's happening with the market right now. we had mike wilson on earlier today. he said it's getting harder to find places to hide. i know you've been putting together a list of places still good places to be. dow futures down 180 this isn't maybe the washout t flush we thought we were going to get, but it's not good either. >> no. mike did a good job today. look, there's a funnel of companies that do better with a rate hike domestica ally that do not have to worry about costs but it's a very small funnel, and that's part of the problem

you've got china offline, russia affecting all of euro, the fed trying to slow down our economy. becky, all i can tell you is let it rain. that was my view on friday and thursday just let it rain let it get down to the point where everybody's price target is down. remember, the banks, which everybody loved at the moment except for jpmorgan, have come down dramatically, but when you get a rate hike, you can raise everything, all the numbers. do i want to be as bearish as the market i have to respect how horrible the market is. at the same time i follow the twi twitter because it shows me if you look at the core value of companies that are prebear, you might be able to reconcile that price. i don't want to be too negative because the market is falling so fast, but i also know the only bounce you're going to get is from negativity and what i regard as being dead cat. >> hey, jim, do you think it's march of 2020 in beijing and what does that mean for chinese

stocks and chinese company and by extension what does it mean for us, the fed, and everything else >> look. i think it is march of 2020. they're now -- their vaccine, for lack of a better term, doesn't work, and it had a short life, for those who got it there are 55 million elderly who didn't get it. everybody's at risk there. the idea they could contain this is fanciful. the idea they wouldn't take the vaccine, which j&j had tons of certainly wouldn't take the mrna it assumes they going to have a very long lockdown it's almost as if they're begging for -- there could be famine there, and famine breeds revolution that's no longer out of the question >> that is pretty concerning i mean, jim, the things we're trying to measure today, the idea of where covid goes in

china, how they respond next, how europe responds to russia, what russia does next, these are pretty unfathomable questions and you kind of have to figure it out before you can figure out not only the direction of the markets, but commodities and anything else. >> so right, becky i cannot wait for this when you get to saturday, the pilgrimage, you're going to hear that this is a terrific opportunity because russia and ukraine will be resolved one day. i mean i hate to say it, everybody in china could get covid. that's not obviously what they want, but certainly it's an outcome. what i think china is so shameful about is we have pills and we have vaccines that would make it so that you'd cut the death rate dramatically and they just won't use them because they are american. >> yikes jim, thank you we're going to see you in just a few minutes. >> thank you very much. >> great to see you. and, again, stick around, because you want to hear more

about what jim's talking about with these list of places he's finding that may be safer places to check out tune in just a few minutesful he'll be back with "squawk on the street." gm this is exciting a surprise new all-electric model. phil lebeau joins us now with a special guest. hey, phil. >> thank you very much an electric vette. let me bring in our guest. tell me about the decision you've made when it comes to the corvettes? >> thank you for the exclusive opportunity here if you remember a few months ago we discussed how we with were moving the corvette team into the e.v. space here at the tech center we're here today to tell you about an electric feed corvette

that's coming first and then a fully electric corvette after that. >> we're looking at some pictures of it in camouflage last wintering some training going, test driving you were doing. timing when can people say i want an electric vette and they will get one? >> that's the great news we will have an electrified corvette next year this is coming very quick. >> and a fully electric one? >> more to come on that. we're not going to talk about everything here today. but very fast. we're getting this -- you know, this is in addition to all of the great performance that chevrolet and corvette have been known for for many, many years with our internal combustion issues it's in addition to. >> i have to ask about adam jones' note last week after tesla earnings he said the more we see, the more we're concerned about the rest of the industry'sable to catch up can you catch up >> i love adam jonas what he've not seen is some of

the vehicles behind us which tesla does not flat out compete. if you look at the hummer, the lyric, the hummer suv, the new silverado, the sierra, the blazer -- >> they're all coming. they're not here yet people are looking around and saying, okay, these out on the . >> absolutely. we are ramping up the launches we brought the lyrica ahead nine months the hummer in 2 1/2 years. our ltm platforms are going to be our strength, and you know, our pipeline is fully loaded here we come. i have to ask you about inflation, rising interest rates. you have been around the block a time or two. you have seen this playbook before how concerned are you about this cutting into demand that's out there and hurting demand for future sales, not just gm but the industry. >> we have been in the industry a long time. obviously general motors but all of our originally oems as well we have seen interest rates

around 8 plus percent. we see a tight employment market, which is great people have jobs it's secure. there's no housing bubble like we had in the past, so there's a lot of stability in terms of demand and disposable income plus, we're coming off the pandemic, and i think people didn't spend a lot of money, but the demand is there. you're seeing a little bit of that pricing power here that's remaining, but, you know, we've got to keep our powder dry in structural cost and break even points and that's what we're doing. >> mark royce, president and general motors, they announced, they're make aning an electric . guys, back to you. >> phil, thank you for that. very cool. very cool news . when we return, what to watch in the markets ahead of the opening bell on wa seelltrt. and twitter and musk, you're watching "squawk box" on cnbc. or is it a feeling?

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i'm trying. this driver had to hit the brakes when the tesla didn't understand a detour sign. ok. here it almost hit a truck. obviously, i had to take over. and here it swerves into an oncoming lane. look at that! often, the tesla doesn't know what it wants to do. what is it doing? or just doesn't know how to turn. jesus, oh my god! tesla's full self driving software for drivers and pedestrians, it's unsafe at any speed. tell congress to shut it down. . a little more than a half hour before the opening bell on wall street friday was a rough session, averages are even further from their most recent highs, got a lot of results this week liz young is head of investment strategy at sofi, looking at

your notes it's before your time. 1981 hill street blues. let's be careful out there every time the guy had a meeting, it was either the sergeant, let's be careful out there. i think that's what you're saying the one thing that's going up that you're seeing, volatility in correlation, which gives a lot of people nowhere to hide. it's time to be careful. >> that's right. that was slightly before my time, joe, but really right now, i think what people need to think about is the only way out is through, and we have to just let this play out. after a day of indiscriminate selling like we saw on friday, we may see another one today we may see it a couple of times this week. it doesn't benefit any investor to sell post those days. usually, and we know this historically, some of the best days in the market tend to happen within 30 days of the worst, so this is not a time to run for the hills. but it is a time to reevaluate what you're buying

if you think about traditional -- >> sorry, i was just going to ask. you talked macro what's your most positive macro fact or factor is there one it just seems all negative >> well, when we talk about macro, i think generally what people are looking at is do we have a recession on the horizon. a lot of the signals, people continue to talk about the economy being strong a lot of those signaling are still showing strength think about the labor market, super tight. we're not going into a recession with this tight of a labor market we have pmis that are expanding, leading economic indicators that are still growing, and consumer sentiment actually bumped up last month there's still a lot of signals of strength in the economy, which means, even if there is a recession at some point in 2023 you have time. it doesn't benefit anybody to get out of the market between now and whenever that time may be >> okay.

the first thing that you go into, liz, is that the 75 basis point hike, the talk of it is front and center, even though you don't expect that -- do you ever expect a 75 basis point hike this cycle. >> never say never i don't expect it in may or june but what i was saying in my notes is the market expects it that's what matters. that's the hand in front of our face we're going to get the big hike, more hawkish behavior than we thought before and it's going to look like the fed is admitting they were way behind the curve i don't think we're going to get 75 i think get 50 in may. maybe we get another 50 in june, and i think some of these indicators about inflation being at its peek will start to confirm that it was, in fact, at its peak that will give the fed the opportunity to step back from the hammer and evaluate the situation. >> if you had cash in buy, you

would buy specific things, defensive positions which include, staples, dividends, health care, low volume etfs, unconventional big tech. discount retail, and you would even buy treasuries. >> i broke those in two buckets, and it's low volatility etfs. if you're scared and you think you're going to continue to have volatility, and i do think we're going to have volatility through the spring and summer. make sure you have the traditional defensives in the portfolio. some of the unconventional defensive postures right now would be things like big tech. it would be things like treasuries people have been so bearish on treasuries for a long time they have sold off more than the stock market this year, and you want to be consistent with the thought process, if you think the fed gets to back off their stance later in the year, you probably see a rally in treasures. you want to have that in the portfolio, and think about some of the longer term themes that are discounted on evaluation

level, cloud software, biotech where you have growth opportunity going forward, even small-cap value stocks you can get into those today at a pretty good discount, and look out two or three years, and have a good opportunity. >> do you think we get down to another, like, 3,800, 10% more on the s&p or maybe it's not 10, but and then once we do that, do we immediately start another secular bull or do we -- would the next couple of years in your view, are we going to be digesting this interest rate environment of higher rates that we haven't seen that type of cycle since, it's been decades >> i think we're digesting it for the rest of this year, but also remember, we have midterms coming up in november. the market usually does pretty well post midterms so i think this is going to be a second half strength story. >> okay. >> but looking at where the

valuations are now, we're at an average on the s&p, we could go back and visit the lows of this year, another 2 1/2% down. i don't think that we get down 10%. >> thanks a lot. you can tell we're getting close to the end of the show nine seconds thank you, liz young we have improved, we're not down triple digits on the dow, and you want to know what that means, make sure you join us tomorrow "squawk on the street" is next. good monday morning, and welcome to "squawk on the street," i'm sara eisen with jim cramer carl has the morning off david is on assignment take a look at futures as we begin a new week of trading off an ugly week last week we have cut our losses still looks like down triple digits, down 101 on the dow. s&p futures down 16. we were down about 300 earlier in the morning we'll begin with the markets under pressure as concerns about