tv Squawk on the Street CNBC August 3, 2022 9:00am-11:00am EDT
>> thanks for having me. final check on the markets, 200 on the dow, up 198 you can see the nasdaq chipping in strong, up 81 july was a good month in terms of a rebound just headed back down any day, andrew that's why i have to tune in, i guess. >> that's right. the train may have left the station. >> i believe so. it's not backing up. join us tomorrow "squawk on the street" is next good wednesday morning welcome to "squawk on the street." i'm carl quintanilla with jim cramer live at post 9 of the new york stock exchange. david faber has the morning off. stocks looking to give back some losses as speaker pelosi departs taiwan lots of corporate results, starbucks, sofi, opec with a production hike.
a week after intel shares plunged post results robinhood the latest company to cut jobs announcing it will reduce head count again, this time by about 23%. and paypal's jumping in the premarket. elliott confirms that $2 billion stake in the company let's begin with corporate earnings we mentioned amd, tarbucks, airbnb, jim. amd, i guess if the notion was there truly killing intel, some argue this should have been better >> let's get right to it first of all, tonight i have the implacable ceo they did not guide down. the next quarter they guided down they have a five-nanometer chip that the titans want we know who they are they sid double digits in pcs. that was confirmed by intel previously they said there was weakness in gaming, confirmed by intel,
confirmed by pretty much everybody. what's really important, they gained a record amount of share, just a huge amount of share everywhere against intel xilinx was up 20%. they bought that i think they are going to blow away the last quarter. look, it's true. if i were in the pc business, i would be very worried, but i think that because she has this five nanometer -- we have to remember it's -- if you want to buy the ones for tvs and cars, those are 25 those are these big, stupid nanometers this stuff -- she's so far ahead of everybody else that all i can say is go sell it. be my guest. go bet against her have fun knock yourself off i'll see you on the asphalt. >> the street is definitely focused on pcs lisa su talked about pc weakness last night
>> we have taken a more conservative outlook on the pc business, so a quarter ago we would have thought that the pc business would be down let's call it high single digits, and our current view of the pc business is that it will be down let's call it midteens, and that's contemplated into our third quarter guidance >> all right i assume you'll expand with her tonight on this. >> yeah. third quarter. she can guide out fourth quarter. if i were this the stock of hp, inc., i would be concerned and i like the ceo very much but i think there's a lot of people who feel -- my charitable trust has been doing this forever -- that this was the beginning of a weak quarter. what i'm saying is because they have the right sized chip, they'll be an acceleration in the fourth quarter and the people who are shorting to sell it off of pcs don't realize that's one of the reasons she bought xilinx.
pcs, i was surprised they could be this bad because people are just saying, hey, listen, pcs are -- when you work at home, almost like it dovetailed with "the new york times" piece yesterday, about how the middle of the country is coming back to work so you don't need another pc >> right >> i think su is being very controlled in her words about pcs. she may be underpromising. >> i was going to say. >> and people know that the stock was up 2% yesterday. but, look, there's always people who want to call top in the semis, and amd, nvidia, and marvell tech have been ones that are down a great deal versus qualcomm my charitable trust has all of these. qualcomm, barely -- qualcomm has held up really well but that's 5g >> it sounds like you would avoid a basket of logitech, best buy, hp. >> what a great question because
logitech did say they saw a bottom in gaming hardware. you know what, i have to tell you, i think that best buy -- that dividend is safe. they did think that the game wasn't going to end until next year they were wrong on that. 4.72% with very good management supply chain by cory barry i would buy best buy >> all right all right. moving to -- >> hp. >> moving to some restaurants, starbucks quite a quarter as we get 84 beating 76. concept three. it was a little light but china's down 40, what are you going to do? >> i went back and forth with howard last night. howard's, i don't know -- i'm not going to say since he was born we were going back and forth about things that happened in new york in the '60s and '70s. this was an amazing quarter. first of all, he's reconfiguring the stores he recognizes that cold brew is what's really important. second, these numbers ex china
were extraordinary he's doing his listening tour, talking with everybody they're going to change the formats. i think that this was the beginning of the next leg for starbucks. as i told andrew the previous show, my charitable trust, we have a meeting tomorrow. i have to put this in the bullpen. too extraordinary. the old howard, a well-orchestrated conference call there was this fellow milton cross. he was the person you listened to to understand the opera if you didn't understand. legendary, metropolitan opera brought to you by texaco i would listen rapt to milton cross to understand what the opera meant. i was rapt last night to howard what it meant for the sea change oh, my, i felt like at the end i wanted the done of green, inc. orange messed up >> orange is home depot. >> i was like where is the
green -- mexico. >> it was fascinating to listen to the cfo talk to bullard on "squawk" about how consumers are not only enraptured by cold brew and beverages but not willing to trade down this is what he said about inflation last night >> while we are sensitive to the impact inflation and economic uncertainty are having on consumers, it's critically important that you all understand we are not currently seeing any measurable reduction in customer spending or any evidence of customers trading down >> which kind of collides with what young said a few moments ago, that the low end is ac actually trading down quite a bit. kfc missed >> i had nestle's ceo on last week they have a deal with starbucks. both confirmed that deal is working incredibly well. mr. gibbs on youm, give him som
credit because taco bell is doing high single digits and have added a lot of units. yum is going to trade down but they had a russia problem. >> russia, fx. taco doubled yesterday >> plus 8. pizza hut minus 3 in true numbers. kfc down 2 the numbers were distorted and russia is a real problem they were in russia far more than i realized, more than anybody realized they did add 780 gross units, meaning they're still putting them up. if you think that the stock should be sold, the customers think the stock should be -- taco bell. wow. >> yeah. interesting. speaking of consumer resilience, great interview with brian chesky of airbnb >> thank you >> can you explain on the guidance how bookings and revenue are not actually
matching on the guidance >> there was a mismatch in everything the cash flow, we were looking for -- did a billion in cash flow the previous quarter. very proud of that how it came back to 800. earnings per share were terrific i don't see the tepid bookings i heard they're changing a great deal, going back to citi i tried to nail him on the idea that once you're done with working at home, work at home tend to trade around airbnb. he said his app, which is extraordinary, is changing the way people think of vacation i came away thinking airbnb was very strong. now, people didn't want that people felt that the stock should go down, but i remind you the stock was big ahead of the quarter. but, you know, take dara, who was here, and dara talked about uber when he said they changed the goal posts, wanted us to go for free cash flow
chesky changed it. i thought cash flow but it was earnings buying back shares, that means they're done growing false construct. i think it was a strong quarter. i think he's doing quite well. remember, we don't have a lot of travel in europe, which will be extraordinary for him. i think it's a very good thing >> a couple times you've said that i double dare you. >> these quarters were very good all we do is talk about inflation. when you ask people about inflation they won't give you a single instance of what's being inflatsed. not a single one how about cardboard? no how about polyethylene no >> eggs. >> aluminum in no. >> people throw out dairy and eggs >> dairy and eggs, go to costco. now, the trade-down is not real trade-down it's from supermarket to costco.
if you think costco is trade down, their numbers are very, very good. very strong. >> i like kwhad chesky told you, when you go to a traditional hotel site, you know what you want >> isn't that great? >> airbnb, i think they said they're in the inspiration business because they're offering you ideas of what your vacation could look like. >> my daughter was going to set up a tree house hotel. okay and they have -- like you want to go into a tree house hotel? they had the vertical tree house hotel. that i think is exciting there are some tremendous tree house hotels in california you get that instead of thinking i want to go to a hotel in northern california, you say, you know what, where would i like to stay it's, like, tree houses. i've discovered something new. >> yes >> people may be latching at me, and i don't blame you one bit because i think tree house hotels sound ridiculous, but he mentioned it as being something.
there are some luxury tree house hotelses four-star. >> no doubt. >> i mean, i don't know. how many stars does the bear get? questionable >> right we'll watch all those earnings, and there's more to get to later on this morning as well. as for the broader markets, we had st. louis fed president bullard on squawk today. he talked about recession fears. take a listen. >> with all the job growth in the first half of the year, it's hard to say there was a recession with a flat unemployment rate at 3.6%, hard to say there's a recession the second quarter i think was more concerning, and so i'll watch that karpcarefully. now what i think will happen in the second half of the year is that we'll get positive gdp growth in the second half. i think i will have a reasonably good third quarter here. >> coming out of the powell presser last week, people said just wait, the fed speaks, going to be hawkish.
whether it's bi 's bullard, let wait >> you probably have to do another 50 that's what the 2-year says. >> said 75 today >> i don't think they'll do 75 because at that point what i'm talking about will be obvious to everybody. they'll have gluts throughout system go back to walmart we have gluts in everything at the retail avenue. the number of cars being made in europe is dropping dramatically. those semiconductors are if you think b-- fungible. they will come here. if you don't export gasoline or -- every part of the packaging of food is coming down it is only a matter of time before one or two of these companies breaks forward and says, listen, we'll use the big margin we have to go to major supermarkets we'll cut the price and post
raisin brand is going to take share from general mills and kellogg. they're 29% and 30%. post is 18%. if they lower the price of the liner board and the insides are already lowered, they'll say, you know what, we want to go bogo buy one, get one we need to take shares people forget. everyone keeps saying we'll never cut prices no the wheat guy takes share. that's how it happens. why do you think one day they're charging 5 bucks for cereal and the next day it's buy one get one? because one guy wins share that's the way the business works. >> wait till this happens in airlines once labor day finishes >> exactly well, they never lower prices. are you kidding me colgate and crest have been in a price war forever. as soon as one raises prices, the other guy says i'll take share. this is a competitive market
people keep asking, let's go get in a room and fix price. there's a thing called the sherman antitrust act which says ten years in jail if you want to do that. you want to do ten years in jail or beat the numbers? >> doesn't it come down to labor? we get claims tomorrow jpmorgan says if we get 275 you can start talking about an actual recession developing. >> say it's labor. say you get a text message from, say, a large brokerage say robinhood. say you get -- do you think amazon has done 100,000? they've probably added 300,000 they make a west coast company that is hiring of the titans or -- and then you start thinking, okay, well, these venture capital firms, they don't have any more money coming in i come back and say it's a different kind of layoffs. it's white collar, not blue collar and white collar matters we have become a white collar
country. i think these guys should keep the saber-rattling, do another 50 basis points, but we have to recognize that the layoffs are coming everywhere. except not -- they're not in tool and die we're used to layoffs coming in factories. that's just not going to happen. we should get used to layoffs at places that do business in secu securities and places that make things that are software oriented i'm not talking about that software company that's now $300 billion, came public the other day. i am talking about software as a service. if i work at software as a service right now, all i can say is i better have a backup plan >> it sounds like you think in the wake of goldman's quartz they're the return of rif days, reductions in force, are coming. >> i have done a couple myself, which are terrible they're one of these companies that thought you could do a secondary in the market, they came public in the last three
years, all i have to say is good luck you won't be able to i look at a webber and a trigger. why? because my webber didn't work this weekend and i've been there, done that, so i'm not doing that again. there. that's a statement and a half. you can take that to the bank. i do think that we all got them. we all got a webber or a traeger or the one that's an egg or whatever i don't know clorox reports >> a big report. we'll watch for that you mentioned cars a moment ago. ford has auto sales out for july well oolwill turn to phil lebeau good morning. >> a big number for the month of july for ford compared to a year ago, seams up 36.6%. temper any enthusiasm about that number when you consider july of last year sales were down 31%. that's the choppy market we're in because of the chip crisis as we came out of the pandemic, still 36.6% is a healthy increase relative to a market
that has been struggling right now in terms of overall sales. evs is what people will be focused on their ev sales up 168% yes, it's coming off a small base, but clearly there is momentum there, especially when you take a look at their market share. they say that they have hit 10.9% market share we've talked about this, guys, that you'll see ford and gm start to pick up greater market share as they ramp up production f-150 lightning sales, 2,173 in the month of july, a healthy increase there and then you've got the overall f-series sales they lump the lightning in with f-series overall, those sales up 21.1%. so there's a look at shares of gm and ford. bottom line is this, guys -- as ford prioritizes ev sales and ev production, jim, we'll see those numbers quickly increase
mach-e topped 26,000 that's what we'll see with the lightning as well. >> it's interesting, phil, when jim farley was on "mad money," he basically said that every single ev are on allocation and you can't get one. >> correct >> don't you think that the more chips they have the numbers are going to keep going up i waited a year for my maverick, six months for a bronco. these things are absurd. the numbers are going to jump big when they finally get the chips. >> well, it's not just chips, jim. remember, it's battery production too >> right. >> they're in the midst of bringing on several battery plants as well as final assembly plants so we'll likely say in the next two years, three years, 2025, a dramatic increase in production and sales of evs at ford i have no doubt about that at all. but there's going to be some choppy periods, jim, because the battery production isn't linear. it hasn't with any of the automakers and it won't with ford or gm
there will be periods where it jumps up a lot, other periods where it won't that's going to be what people are watching, how smooth is the transition to ev production. they're in the ramp-up phase right now, but if you want one, jim, as you know, you're waiting at least, at least until the end of next year for a lightning if not into 2024. >> i did notice, guys, adam jonas took ford to 14 last night, although, jim, he also mentioned in the wake of pelosi's visit to taiwan that the face of the battery race is changing, and for that you have to look at tesla, which has the higher exposure to china than any automaker. >> and ford made a big deal with a chinese company for batteries. speaker pelosi strengthened the hand of president xi, whose hand was weakening, because now he's playing the nationalist card i believe it was an ill-advised trip there are reverberations for american industry that there didn't need to be. if you're david calhoun waiting
for that big boeing order, i think you'll keep waiting. >> although i will had bank of america said this morning we have some food export suspensions to taiwan on their part obviously, military drills but they said the bite after that not much after she left >> no. i don't care so much about the bite as the idea that what's going on with the property markets, the incredibly slow economy, what's going on with covid, maybe xi had a chance to be less powerful but now he's saying, listen, we've got to exert our nationalist tendencies here, as autocratic as the speaker said, and, well, geez, this was a chance to really make it so that -- he was in trouble, xi. >> birthrates weakening. economic growth is a huge miss >> he's not in trouble now >> because he's playing a nationalist -- >> we made she made him
stronger how the heck did we make him stronger it's on us shame on us. >> i'm not sure that's -- i don't know people are looking -- look at "f.t." a piece on samsung thinking reexposure to china because of the chips act >> we have a big meeting coming up xi is our -- look, it's a cold war. he might as well be stalin we don't want stalin strong. we want him weak >> a lot of crosscurrents in the wake of her visit as she's now left. >> yes >> we'll get cramer's "mad dash" and count down to the opening bell still have to get to paypal, match, renoneger, sofi futures are green. what do you mean? these straps are mind-blowing! they collect hundreds of data points like hrv and rem sleep, so you know all you need for recovery. and you are? i'm an investor...in invesco qqq, a fund that gives me access to... nasdaq 100 innovations like... wearable training optimization tech.
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as we wait for if opening bell, cramer's "mad dash." >> paypal, charitable trust took a loss because it kept going down and they kept having problems with ebay in the separation those problems seem to have run their course, but more important i think is the stake that we know that l.a. partners has taken. they've taken $2 billion also the largest shareholder in pinterest.
these two companies had thought to combine it didn't work i think that elliott is trying to evaluate their role now, dan shulman, the ceo of pa paypal, said they have an excellent relationship dan shulman is a gentleman to i'm sure he will take into account everything elliott wants for paypal, but the fact is what a great idea to merge them also paypal, the cadence was good each month got better, which makes me feel that at last this overhang from ebay is done so, a very good quarter. upgraded by a lot of people. a lot of people giving up on paypal and they did well >> $15 billion buyback doesn't hurt. >> no. >> price target raised by morgan stanley, evercore, wells fargo raises it. when you look at what he's done, credit suisse rating, it's amazing he pulled himself out of this tailspin because they also named a fellow by the name of blake jordanson from electronic
arts, cfo, they lost their cfo, rainey, to walmart >> we get the opening bell the cnbc realtime exchange, at the big board, the professional fighters league. [ bell ] >> it's been nice to see tourism rebound in this city >> yes it was so interesting that one of the big raps, again, of airbnb was that they didn't have enough rooms in big cities it's just at a time when people know if you go to a big city you can see things again everything's open in new york. so, there is -- as long as chesky can get rooms, ceo, airbnb, in these cities, they'll sell out he was saying was a virtual
circle new york is very much back. >> there's a look at airbnb. as we said earlier, above revenue for the quarter, bookings, still implied growth of about 25, street's in the 30s, and there has been discussion after hilton and marriott these guys might have better guidance, at least. >> yeah. there was a banter with chesky about marriott versus airbnb and there is a notion that they are not in the same business and that's that experiential thing. a lot of people at home say, oh, come on, a hotel is a hotel is a hotel. no chesky has an experiential view. he's been right all along. he's ahead of everybody. he called me i had to lay off a lot of people what's it like the king of layoffs. the answer is you have to grin and bear it. he has been such a great ceo, i
do admire him. now, i have to tell you, no knock on marriott at all, marriott has done terrifically we miss arnie sorenson, but they've done a good job. >> a bunch of names that bring us back to the covid days. moderna today is going to be one of your s&p leaders. we were mentioning cvs a moment ago, jim that's going to be the highest price since basically may? >> well, moderna did a giant buyback. we've all been waiting for them to do something with their market cvs is such a great executioner versus walgreens we keep thinking when is walgreens going to get it together cvs, they're not going to necessarily take share, but when you go in there for a vaccine, you tend to come out with something. walgreens, you come in and you just get the vaccine and you go. of course the walgreens i've been into in san francisco, people go in, they come out with things, but they fail to pay and i have often had to say to
the cash register, do you mind i'm thinking of paying and they nod as if, well, it's great you're going to participate in commerce. >> right you get something, you give something. pretty vocal >> i went to a walgreens in florida, in del ray, and i said to the cashier, i said i don't think that person, that person, that person has paid she said, well you missed that person they know who's stealing they would be better to prevent it >> it's a problem. regeneron up 5%, jim covid revenue coming in, but they still beat on the top one >> i think the hidden current of regeneron is the they succeeded inanti prostate cancer study came through when merck came
out. merck had a note this morning. regeneron got the other half of their combination. this is very good and must be watched because a lot of people have said, it was not as good. i think if he has something that works for prostate cancer, it's very big it made me think, oh, merck, the oelt seattle generals, the merck announcement was very bad. >> yeah. keith had a couple of phase-three failures, this on prostate cancer. >> i was shocked at this i thought the key tree would work what do i know i don't even play a doctor on tv they had a very good series of things today in the report they are a very fine company merck should be down more because of the other >> we've been talking about it
lately and about two-thirds of the way into earnings season how those who have missed have not been punished as much as before. match is going to blow up. >> it's really interesting because it's almost everything everything kind of went wrong with match i look at the numbers, and i think, wow, things are open, people are going out again >> revenue miss. revenue per user >> new division head >> yep the guide below. they say we need to give our team some time to start to develop execution. >> deceleration revenue, slowdown in hiring, negative free cash flow, tinder not doing that well, big impairment. i could light a match under that thing. that was just very disapountsing. i was going back and forth with dominic chu at 5:00 a.m. about how this was the mystery stock and i said oh, no. went from 70 to 60
o i know a lot of people who met each other on hitch. >> you're going to stop there? >> yeah. i think it's salacious and beyond that doesn't help anything, doesn't move the ball, so to speak. >> how about sofi? two-month high here. >> can you believe it? and he hasn't even texted me yet. i expected the usual text for, like, that they opened i probably didn't have my phone. that's probably why. he always texts me if somebody opens an account i like anthony banker who brought thesweet.com public >> i think we'll talk to him at 11:00 on "tech check." >> i hope so because i have him on "mad mo money" >> you do? >> no. >> twice in one day. that would set a new precedent >> a new record. >> we'll watch that. sofi a pretty good gain there. >> deservedly.
that was a very big number of accounts the numbers have not been great for sofi this was the breakout quarter. i think that the stock will go higher i think you have to congratulate him when he comes on because it's been kind of a tough slog for him of late. >> yeah. also at a two-month high this morning is hood. despite the revenue miss and the mau miss they're going to lay off 23% after laying off 9% before bill gurley with an interesting tweet last night saying if you're going to do it, just do it once. don't do it a little bit and then have to cdo it again more that's what vlad's post was about last night >> that is a great point they still had inflows but the customers were being crushed i don't think there's anyone who would want to buy them, even though they have a healthy, large cash position. what bothers me is they're talking about expanding crypto yet when i spoke to vlad, he was talking about being tough on crypto coinbase has 200 cryptos
the s.e.c. hates that and wants that to be an exchange they may lose out to the ftc so there is a clash of the titans between one severe regulator and another. within it, you have to police it yourself i was hoping vlad was going to police it. but more points because they need more customers. >> microstrategy, saylor moving to executive chair, says his next job will focus on bitcoin they take a pretty sizable charge on a stake where i think their cost basis is still in the $30,000 range. >> yeah. i mean, he's been so ill-advised that -- look, i mean, it's telling. the stock goes up. i mean, that's a referendum in itself that the stock goes up. i've often found when a stock goes up when someone steps aside, that's the market making a cool and severe judgment. >> we haven't mentioned solana
wallet hack. it seems like there's waun week. >> look at these things and the idea that this is anything -- there was one that was a ponzi scheme the s.e.c. did this incredibly great -- they had the crypto champions. did you read that? there was nothing to it. it was all middle level marketing, mln solana is not something that i'd recommend to my friends. we have really seen -- look, get me speak to mike there's absolutely a sense of crypto gone wild yet wherngs you say that you're under attack by the crypto maniacs, and we all have to admit it's not as secure as we thought, i begged to get my money out after i sold my ethereum and my prayers were answered by a higher power and i don't know who that was or what it was. but i can't fix it i didn't cause it. and i can't cure it.
>> you see some headlines here on oil it did jump, but now it's gone back into the red. reports were for 100,000 barrel per day production hike, which is a little less than some expected, jim. that said, gas prices, three-month low. we're back to $4.16, down for 49 straight days. big piece in the "journal. >> oil does want to go down. the technicians have piled on it but i would say that if you had oil up, the quarter that we got from pioneer pxd may have been the best quarter of the s&p 500. the stock is even up despite oil. scott sheffield said i'm raising my dividend again. the thing yields 15% scott sheffield is money he's been the best he's also been very good on esg. people are scared, but my charitable trust sells at six
times earnings he's a remarkable man. he's a tough guy too and i like him very much and scott did a terrific job if you want yield, you want income, pioneer natural is for you. >> pioneer, yeah, good results yesterday. jim, overall, holding 4,125. you have the 20-day average and the 50-day average crossing but elevating. i wonder how much you think, if it is a bear market rally, how long to it will last. >> i think that what will really kill it is there's going to be someone from the fed who says, you know what, i've been watching it and i think it's a head and shoulders pat what are they trying to do they come on and they -- you know, there was someone this morning talking about she went into the supermarket and didn't like the prices. there you go >> was that daly >> how about the fact it's the packaging? it's the packaging is down the paper is down.
the trucking costs are down. but she definitively went to the supermarket. i have to tell you, chaos in aisle five can we please have a more rigorous process than someone going to the supermarket i went to the checkout everyone was glum. >> we're actually going to revisit things you've said about the fed actually 15 years ago today. >> well, i think that would be good when we come back >> after a break let's take a short commercial break. we'll look at "the bond report." the 2-year yield declining a touch, still above 3%, 3.07, and the 10-year south of 2.80. back in a moment - in the last two years, we quadrupled our team and the pace we're growing, i couldn't keep up without ziprecruiter. they do the legwork and they get my job posting in front of the right candidates.
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so, 47.0 on services moves up 0.3 to 47.3. however, it's still the weakest level since may of 2020 over two years. our final read on the composite, 47.7, 0.2 better in the mid-month read, 47.5 just like the services, pmi, this is the lowest level in more than two years going back to may of 2020. of course we have the ism services pmi coming out at the top of the hour so we can do a bit of a comparison as yields popped yesterday on tough talk but they're already easing back from their highest levels. "squawk on the street" will return after a short break
got hit in 1990. this is a different kind of market and the fed is asleep >> they were it's interesting the minutes came out and just said laugh >> in brackets >> the transcript transcript cos out and i was that was the worst time, right on the cusp. i completely failed. i've been often vilified as a person who didn't see it coming. the next day, by the way, someone who used to host the "today" show had me on asking if i was off my meds. he too is no longer quite involved in the media as i am now. and i do think what's happened is when you look back at the time you might think, well, did i see it coming, and the answer is full hubris, yes. >> we talk about this clip every august 3rd >> right >> i always have to ask you did
you go into it thinking i'm going to level this hammer >> no. >> was it really spontaneous >> we were going to talk about proctor and gamble pricing, but i'd just gotten off the phone with a ceo of a major brokerage firm that did go under, and i had just talked to the ceo of a one of the largest mortgage companies and they just said, please, please help us we're going to have to lay everybody off. you're the only person to get through, you have credibility. i spent time i was trying to wake them up john stuart made fun about me as the guy who knew the least which was very embarrassing to my family and my taurts i was trying to wake people up and i was ridiculed by pretty much everyone. and it was a tough time for me
in retrospect i should have sai nothing. >> we're learning the classic bear market behavior is going after those who comment on markets. >> and if you listen to that you may think it's the wrong call making me the poster boy i have no illusions about what my job was that day. my job was to bring attention to it in the same way as i said on the "today" show if you have any money in the market i want you to take it out and then i disappeared from the "today" show these are things that happened i'm 67 years old i've seen a lot of many of my friends were laid off, and i i felt like i was the one person who could say something without any sort of retribution. i was completely wrong and people who try to speak the truth in this country you are going to pay the price you put your pants on the next day and come to work and say to hell with it, and that's exactly
what i've done through my career >> it's a good reminder. dow is up 225. >> this furious blitzkrieg by fed officials pushing back against the idea that the fed would be ending its rate hike program towards the end of the year is not dropping the stock market, and you can see here today i just want to show you the s&p 500. remember we were in a trading range 3600 to 3500 and we're trying to break out even towards 4200, and it's being led by the cyclical groups, chlargely the growth groups. semis are down today because of amd, but they've also been rallying back. other growth areas like consumer services have come off the lows and consumer staples, so market wants cyclicales and growth stocks to come back into the
market as far as the earnings go i keep saying no earnings recession q2 estimates are going up, not down now q3 and q4 estimates were in the 8% range and have come down but not dramatically the bottom line is overall for the s&p 500 no earnings recessions so far. we have seen key stocks like amazon and consumer discretionary, they're numbers have come down for the whole year they've dropped their sectors. we've talked a lot about starbrooks, howard schultz saying no reduction in consumer spending we've been seeing, yes, and you can see this has been echoed by other people chipotle had a similar comment the majority of our customers a higher household income consumer, and we've seen their frequency increase and potentially not experience some trade down but to the extent chipotle and
starbucks are higher end consumers, that's certainly true mcdonald's was not so sanguine about this, a couple weeks ago july 25th, we are seeing some trade down we're seeing customers specifically lower income customers trade down to value offerings and fewer combo meals. so the obvious take away, and we saw this with simon property group higher end holding up, lower end's not. but this is a really complicated environment. i want to put up what david gibbs had to say, and he went onto describe it isn't just quite as simple as just saying the high end consumer is still holding up on the low end, that covid supply chains, china has really made this a very, very difficult environment. he said it was the most complex environment he's ever seen so, carl, i think it's certainly useful for all of us to say high end is holding up better than the lower end, but there is an
awful lot of really complex parts to this, and that's why the outcome is still so very difficult to predict >> remarkable comments there jim, what's tonight? okay, one of the best performing companies during the duration stock has just been doing a tear since he was -- since they reported it, and i think that's right because they know what to do plus covid and now controversial the stock was down -- so ill-advised people sold it down 6 points i think the stock should be up because it was a great quarter but you know what? they know nothing. i'm sorry if i offend anyone describing what happened after but my wife says why did you ever say it, you should have never said it. and i said it was the truth, and she said so what, look what it did to you i said i'm proud of you. she said you have nothing.
>> that's one reason we turn to you, jim >> she said, look, you took tremendous heat. what was the point i said the point was to help people because my boss is the audience. >> jim, we'll see you tonight. "mad money" 6 p.m. eastern time. when we come back we'll talk with michael saylor. n'gowa up, dow up 222. dot ay.
good wednesday morning welcome to another hour of "crosswalk -- morgan brennen on maternity leave. this morning's got something for everybody. corporate results, a lot of fed speak, got some opec and now some macro data. rick santelli's got it >> better than expected, second highest read in the year other than january when it was up 2.3% if we ex transportation out, it
deteriorates to up 1.4 so of course transportation kicked in a positive fashion which means we have a midmonth read we toss it. so the midmonth read was up 1.9. it gets replaced with up 2%. up 2% is also the second best of the year outside of january when it was up 3.1% strip out transportation, it really drops to up 0.4%. a proxy for business spending up 0.7. that's a nice number considering it was up 0.5, so we replace that june final and it improved. and finally if we look at shipments, also up 0.7, and that equals our mid-month three for our money ball numbers in many ways institute for supply management services index, 56.7. 56.7, and that is, indeed, good
news because in the rearview mirror 55.3 was the worst level going back to may of 2020, so a definitely improvement there interest rates, well, they're definitely higher on the session. we want to pay really close attention. below the market to two and three quarters percent >> three big movers we are watching paypal shares surging this morning after strong results there. the company also announcing a new information partnership with activist investor elliot management who has about a $2 billion stake in the name, which is currently up more than 13%. starbucks also in the green this morning, up about 1.3% despite higher prices. consumers still spending big on coffee guilty here as well with domestic same store sales up 9% year over year and finally microstrategy headed
higher despite losses for the quarter. the company taking an almost billion dollar impairment hit from its bit coin holdings that stock up more than 10% this morning. and we'll be breaking down the quarter with ceo michael saylor in the transition come monday. meantime president bullard speaking out on the economy, job, and a lot more on the cnbc exclusive earlier today. steve joins us with highlights and maybe some thoughts on the prices >> yeah, the prices one fell i want to point out i've long been talking about this idea the service sector may be doing better than we think we just don't have data on the service sector and this confirms we have great data on goods. our statisticians still have lousy service data let me move onto the topic at
hand the fed president pushing back directly against market pricing that sees the fed cutting rates next year. not only did jim bullard say he thinks the fund rates should go higher but he said it should be higher for longer. >> i think we'll probably have to be longer for higher in order to get the evidence we need to see to see that inflation is actually turning around on all dimensions and in a convincing way coming lower, not just a tick lower here or there >> bohe says he also expects better for the second half of 2022 and push back on the idea the economy is currently in a recession. an idea that will be challenged again on friday. that would continue this ongoing anomily we've seen between negative gdp growth. payrolls on average fall about half a percentage point per
quarter. instead of losing a million and a half jobs, we gain 3 million that's a 4.5 million job swing job growth behavior over these past six months is just much stronger than the average recession, and that's true for almost every other monthly metric they look at except for the quarterly gdp data yet by many accounts workers remain scarce. if we don't have a big decline in jobs it's unclear, guys, if we've had a recession at all >> yeah, steve, it's clearly unprecedented times and hard for economists and market pontificators alike to know what the future holds if we don't know what the past looks like. >> thank you so much for crunching that data for us and for bringing us that interview while market bulls have pointed
to june lows as a bottom our next guest doesn't think so. he's forecasting more volatility ahead as we get into september so you don't believe that that june 17th low on the s&p of 36-36 is indeed the low for the year you actually see uncertainty increasing whereas back in june there was lots of fear put it all together and when you think about the data we just saw it's very clear that the fed is going to stay luteallyhawkish
against. >> and you're right about the wall of worry there. we've got geopolitical risks we've got monetary tightening out there, rates increasing, potential softening in the labor market, littleeds of that. two quarters of negative gdp and the market shrugs it off and says whatever. is that an end of july-august phenomenon to you think will change in september? >> two key things. professional investors de-risk the minute they start getting concerned about russia's invasion of ukraine. the public was a little slower to sell. the public did sell in april but all of a sudden, if you if
back to the june fomc meeting you had yields fall and stocks have responded very positively from that. from where we stand right now, particularly given the tatdata the top of the hour, the fallen yield story has likely run its course that, too, is a headwind for stocks people just aren't concerned about too much and i think you could easily make the argument that some of the activity we've seen in et last several days shows that the mien stock is still there. and it tends to be a dangerous type of month behavior >> you mentioned the data at the top of the hour. earlier it was the fourth biggest month on month drop in the history of the series. today it's services.
biggest monthly drop since 2017. we're going to start to hear more people argue that jackson hole will be an opportunity for the fed to truly pivot do you think that's too optimistic >> we do we do. now the positive, and we'll say that the ed hyman and his team's surveys have shown conclusively that pricing power has started to turn, and that's a major positive in the battle against inflation, but there's clearly much more work to be done. and the fed has really made it clear that the last thing that they want to do is get into a position where for some reason they have to cut rates, subsequently in 2023, simply because the inflation problem may not have been cured. so there is more work to be done in terms of hiking before we sound, you know, more of an all-clear, particularly for the equity markets >> so julian, given that
backdrop and what you mentioned about where you think we are with regard to rates at this point in time, and the potential head wind that could provide for stocks, where should investors be putting their money or to you recommend sitting in cash in this environment >> the first thing investors, and i've been listening to the last 20 minutes of cnbc, and the commonality has been the complexity of the environment and how the emotions take over this is a bear market. it has been a bear market. emotions run much higher what you need to do is sit back and say to yourself, if, in fact, our view is right that you retest the june lows at some point, are you a buyer of stocks at that point? because you shouldn't be selling low and buying high. that argues for a larger than normal cash position and something that you don't tend to do during secular bull markets, which is, as the market runs higher, you want to trim some of your position. so, again, you can be in a
better position to buy weakness when it materializes >> julian, i wonder if you think if we really do need to revisit the lows,s to it need to happen in a flush to we need some outsized volume day? there's been some suggest that true market recoveries or bottoms don't necessarily happen on some big bottom rush. >> we'd like to see that, carl, and as you point out, it isn't a necessary prerequisite and didn't happen for the most part at the first low we had in may and then in june buying spiked a little bit you didn't see the kind of panic would you hope to see in the volatility market, the kind of panic you saw in march of 2020 our view is that ultimately, you will see more of that, but that's probably something that, again, is later in the year or 2023, and only likely happens if we get closer to the potential for recession, which we don't
see at this point. >> hmm all right. well, a lot of moving pieces there. we will brace ourselves, though, for a second half of the year or what remains of it, julian, thank you. >> thank you meantime, qopec's wrapping p that big meeting big day, brian >> yeah, it was a big day, and opec did not necessarily deliver in the way that the white house may have wouldn'ted. the meeting, which means russia ending just about an hour ago, it was the first meeting since the deal for the record cut made during the pandemic in may of 2020 ended so, because of that, it wasn't just a rubber stamp event. it was a lot of interest and intrigue around it and going into it, and maybe hopes for some larger production increases to send oil prices lower, but opec brought a huge bucket of ice water onto that.
the group agreeing to an almost relevant increase of 100,000 barrels a day. that sounds like a lot rhe let's put it into context. that's just one tenth of 1% of global demand and 0.5% of the global demand jump of 2 million barrels per day next year in a way, it's like no increase at all or maybe a cut compared to demand growth opec led by the saudis noting the severe lack of excess ability. in plain english, they're saying no country can really pump much more right now and what they do have, they're going to keep back, because if russia goes massively offline during the next round of sanctions they want to come in and fill that gap then, not now. oil prices holding steady today,
maybe ticking a little bit higher they have been dropping steadily since june it has not been below 90 bucks a barrel in some time. the strategic stockpile of oil swipedin is winding down. the full thing is not for a few months for now, opec sees russian production a little higher than last month and the same as prewar levels, but after december 5th it all change and this opec non-increase is keeping oil and gas stocks firm.
>> brian, good summation today, and we'll wait for the next meeting coming up in early september. that's our brian sullivan. take a look at the road map for the rest of the hour amd's under a little pressure and some of the key chip names you should be buying ahead of the interview tonight. why confidence is hitting new lows and what the fed has to do about it. and michael saylor is coming up next. eassndor aerhee,ft t brk. the pursuit is on. the pursuit of outperformance at pgim. with deep expertise to outthink across multiple asset classes, actively managing investments in the world's public and private markets. outscale, with the resources to serve 1,500 clients in 52 countries. and outlast, with long-term conviction that looks beyond today's volatility. join the pursuit of outperformance at pgim. the investment management business of prudential.
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sa one of the biggest crypto currencies swinging after news of a widespread hack on the ecosystem. not something holders of sew lana wanted to hear. it adds to alonglist of hacks. data estimates $5.2 million in funds were drained from almost 8,000 wallets. it included a small number of nfts i spoke to tom robinson. the root cause still not clear it appears to be due to a flaw in certain wallet software rather than in the solana
software itself. this was across thousands of individual wallets, which are often seen as the safer way to store crypto it initially hit the price of solana it was down as much as 7% overnight, rebounding a bit this morning. it does look to be down 2% rate now. the network has been billed as a big competitor to ethereum. the selloff overnight was a knee jerk reaction to some of those hacks. and solana has had its share of problems but it does not appear to be an issue with the network itself. many investors say they glued their toke p to wcold storage o
offrain. that's because the software does not appear to be hacked but the wallets and the software used to move those, bridge software. it's on the smaller side compared to the hundred million dollar hacks it does add to major ones this year the ronan was the biggest. nomad is another bridge protocol and lost about $200 million. those intermediaries >> so much too keep up on. mike micro strategy splitting the chair and ceo roles monday
it's great to have you back. >> thanks for having me, carl. >> we've asked you for a very long time about the bifurcated corporate strategy between bitcoin and swear. >> the company's been executing on a bitcoin strategy for the past two years, and it's worked really, really well, not withstanding the volatility. our stock's up 123% through august 1st and if you compare our performance to bitcoin, the s&p's up 23%, gold's down, bonds are down, silver is down we nearly tripled, doubled the performance of google. we outperformed apple, which is only at 43%. microsoft's up 34% amazon, met a and netflix are down you never would have guessed that it could outperform all of
big tech and every asset class, but it's worked extraordinariry well for us. >> do you attribute it to bitcoin? on your tweet this morning, in my next job i intend to focus more on bitcoin. how can you focus more than you already have >> the secret is creating a hybrid company that's not a stable enterprise software business with stable revenues and good cash flows and adopting a treasury reserve strategy. i said before bitcoin is hope. and bitcoin is the strategy that we use in order to outperform during a very difficult financial period when most currencies are crashing and most assets are struggling. and i would recommend it to anyone looking at a good treasury strategy. >> you reported there was a $918
million impairment charge just due to the selloff of bitcoin. i'm just curious, how long has the transition been in the works on the ceo and chair role. >> there's no relationship between the transition and the writeoff, it's a non-cash writeoff the board of directors looks through that as well as the officers fong has been the president and the ceo heir apparent. he has been president and cfo until may of this year but given the size of the balance sheet and opportunities in front of us, the company really needed a world class, ted ka kated cfo. it cleared the way we have a talented executive
in the same time period, i have emerged as an important advocate and spokesperson for the boin community. while fong and andrew execute on the ongoing business strategy. >> it seems like we always spend all of our time with you, michael, on crypto currency and not enterprise software. are you going to miss that part of the business? and what do you make of comments from others in the business that suggest longer lead cycles, longer time getting renewals, especially in areas like europe? >> it's a greats business. we are very enthusiastic about it i'm not going away i'm the chairman of the board. i remain the controlling shareholder of the company, and i'll be working on innovation and other corporate strategy activities with fopg we're a very, very good team
but we're very enthusiastic, and i think a hundred years from now people are going to want to buy business intelligence out of the cloud. that is not going away the bitcoin strategy has helped us whether the financial storm, you know, of currency devaluations and the like, and it has raised the visibility of the company by orders of magnitude, and it's given us a lot of financial flexibility, because of our strong balance sheet position >> michael, i just wanted to follow up on that. because i know the accounting for, you know, unbalance sheet crypto currency is pretty nas yepts in terms of how to account for it, but there is significant volatility in aligning so closely with bitcoin yes, while some investors may look past the impairment charge for the quarter, others may rook at your company as a levered bet on bitcoin so how to you advise looking
ahead into the rest of the year on the prospect for additional volatility here? you see that ultimately streamlining over time >> i say volatility is vitality. a lot of people ignored our stock two years ago. now there's more news every 15 minutes in our stock than there used to be in months so interest in trading our stock has elevated by one to two orders of magnitude. you can't really ignore us and yes, one part of our strategy, the bitcoin strategisa levered, long bitcoin strategy, and we don't make any apologies for it, but the other part of the company is a very stable, mature, enterprise software business which generates consistent cash flows. so i think it's been a benefit to our shareholders.
that's. why we're 123% as for the future, a lot of people are afraid of volatility. if you don't want volatility, you can buy gold i do think the volatility will come off gradually over the next four to eight years as regulat regulatory control goes. >> i'm curious your comment about how your bitcoin stake has raised your visibility in the eyes of customers. i can envision a customer saying i love your product but you have this whole other business that's a distraction. if i wanted a crypto house i could go find one. what i needed was a software company. >> it turns out that every cfo, they're all aware of the crypto
revolution and thinking about how to get engaged one thing you do in an enterprise software business is you have to reach the sea sweep. and our bit koip strategy has put us right up along side microsoft and oracle and s.a.p it's a benefit in terms of marketing and sales. we're well endowed we have a huge balance sheet it's been a dee riglight for ou employees. it is a net positive for the entire enterprise software business >> michael, i just wanted to get your thoughts real quickly on a new senate proposal that would give the cftc regulatory control. >> everybody wants digital
property like bitcoin, everybody wants digital currency like the u.s. trdollar it's pretty obvious that the 24/7 friction-free mobile app is the future of finance. and that means everybody wants to get in on the action. av every regulator is interested. this is an ongoing debate in europe, in the middle east and singapore. i think that wheat's happen ♪ ed is we've catalyzed. it's above my pay grade to opine on which bill will be successful in the senate and which regulatory committee but there are mega investors who
have afraid to put huge amounts of capital into this asset class until they understand the rules of the road. as the regulators sort out the rules of the road and provide the clarity, it's going to be good for bitcoin >> does the move to chair, does the overall change in the management structure imply any change in strategy or any net selling of bitcoin at the margin >> you know, our officers and directors are unanimously committed to the bitcoin strategy i think people heard that on a conference call yesterday. our new cfo's excited about it, fong is excited about it, i speak for the entire board of directors. we didn't go down this path without thorough consideration as you can see from the numbers, it's been a screaming home run for the shareholders it's been great for our customers, our employees, our partners we're full speed ahead >> look forward to having you
back really good stuff. thanks for the time. >> thank you when we return, what starbucks and yum's results are saying about the state of the consumer we're back in tw so, for me and the hundreds of drivers in my fleet, staying connected, cutting downtime, and delivering on time depends on t-mobile 5g. and with coverage of over 96% of interstate highway miles, they've got us covered. (vo) unconventional thinking delivers four times the 5g coverage of verizon. and it's ready right now. t-mobile for business.
welcome back to "squawk on the street." let's get you caught up on the news updates a man accused of opening fire at a fourth of july parade in suburban chicago is due back in court today and faces 117 felony counts in the attack that killed seven people and wounded dozens more after his arrest following an hours-long search the 21-year-old confessed. the first grain shipment under a wartime deal is set to sail to its destination, lebanon, after its cargo was checked and approved in turkey 17 other vessels are loaded and waiting permission to leave port in that country. and legendary broadcaster, vin scully has died. the dodgers announced his death on twitter, saying, quote, vin
scully was the heartbeat of the dodgers, and in so many ways, the heartbeat of all of los angeles. scully was 94. in many ways, fwiguys, he was really the voice of baseball investors trying to get a read on the consumer are diving into two name, yum! brands and star buck. we are joined with the big take away >> starbucks rising thanks to a beat on the top and bottom lines. driven by the u.s. performance, particularly with cold drink, accounting for about three quarters of sales. same-store sales rose 9% in the u.s. thanks to higher average orders and a slight tick up in traffic. howard schultz said the company's not seeing any meaningful pull back in consumer spending or consumers trading
down at the moment this is in contrast to what we heard from mcdonald's. china was a big story, their same-store sales falling 44% star buck pointing to mobility restrictions withip episodic closures now to yum brands, that stock lower. taco bell was the only one to report positive retail sales pizza hut fell 4% in the u.s kfc fell markets were down significantly for pizza hut and kfc. like starbucks, they saw china's lockdowns impacting their brands expressi expressing that they do have confidence in the resilience of the brand, they are seeing a
little bit of bifurcation, but it is an oversimplification, and this is the most complex environment he has seen in his career >> still impressive comps at taco as we talk ed about with kramer this morning. amd is the latest chip name to fall on results the key winners you should be betting on lisa su on with jim tonight. w we were positive for the week with s&p back in a moment. 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! become an agent of innovation with invesco qqq
the slowing pc industry. you have inflation and the reopening of offices and schools. it did post a beat gaming declined quarter on quarter on weaker graphics chips. but perhaps gaming is holding up data center sales were a bright spot, an increase year over year, and you look at intel's results. they had a 16% drop in data sners. if you look at just the stock price, amd is up, what, 6%, versus intel down about 20%. amd snipping away at market share and microchip has low
exposure to smartphones. there's divergence in the weaker pc set don't miss lisa su tonight on mad money it's going to be a good interview between lisa and jim in the meantime, let's bring in fidelity investments portfolio manager, adam benjamin thanks for the time today, much appreciated. we got the results on pc weakness, we know what intel said about their quarter, results about korean inventories and stockpiles is this the time to be getting into the space >> thanks for having me, carl. look, it's been a very complicated year for semi-conductors. there's a lot of cross currents in the industry alone that's been evolving through covid, the recovery and the shortages that have lasted for quite some time,
and then you have the macro effects that you're talking about, whether it's recessionary fears and china lockdowns. but reilally the way i'm looking at it is the end markets that are going to do bert on the other side of the shortages. people have been trying to predict this for almost a year, and no one's gotten it right so i'm going to focus my expertise on end markets where i think on the other side of these shortages have secular trends. companies that have content opportunities and shared opportunities like an amd, for example, that has picked up a lot of share specifically in servers as well as pcs it is not something that got speeded last weak oek or last mh
amd set a good map and more importantly, you had a disruption in the end market where you move from the enterprise to the cloud, and that created this big gateway and opportunity for amd to take all that share >> speaking of end markets, you know, there were warnings from amd and intel on the pc market what are you forecasting on when some of the pressure on the end markets may see a bottom is it this year as intel suggested? or further out >> well, i think you really need to go back pre-covid to look at certain end markets, and specifically, you're asking about the pc market, that market had gone ex-growth pre-covid and was on the decline all of a sudden during covid people got multiple pcs for work, for home, et cetera. and the pc got reimagined.
so we went from a market that was 275 million units or so, declining 2% or 5% per year and you went tup to 350 million units. i think it's a market that is ex-growth. we are going back to a market 275, 280, and ultimately, it's going to be ex-growth going forward. same thing for the smartphone market you need to be thinking about what covid drove, and ultimately, what are good markets that were growing before and that could maybe potentially even accelerate on the other side, versus say, pcs and smartphones that are going to have a big hang over >> it's actually something that everybody can understand or relate to given their own personal experiences with demand during that time, adam thanks so much >> thanks for having me. investors continuing to weigh the impact of more fed
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one of the key debates among investors is whether the fed's tightening and rate hikes have trickled through the economy some believe it's the second half of the year when balance sheets come home to roost. >> they haven't turned up the debt i don't think it's going to impact the large, multi-cap ig credit companies i think you'll see some surprises. that's what we're getting ready for. that's what we're preparing for. as i think that's phase two. >> briton briefselieves we'll sn
uptick in companies trying to refinance. he believes the fed has changed forever and as a result it won't intervene as quickly as the market is used to and at a smaller level if it ultimately does intervine we spoke with briton to swatch the full interview, or subscribe, scan the qr code. so not the most optimistic look at the second half of the year but we haven't seen this huge wave of defaults or bankruptcies chapter 11 bankruptcies are down something like 13% >> although that was in the auto space. they're watching delinquencies
on things that are frequently financed now a report that meta's looking at their first ever. what does that imply do they sense the good times are short? i don't know. >> it's a really, really good point and the mind-set right now and this a good time, is there more pain ahead a company like meta may be in a different category, but others that could be sitting on a lot of debt, seeing rates rise, unable to refinance and, therefore, getting into some trouble. >> right those who had to build a lot of debt during covid, and whether or not it will be time to pay the piper. fascinating insight into what we may be in for. coming up on "techcheck," we'll break down the moves on paypal and amd on the back of results from both of those names and sit down with anthony noto of soef phi. shares this morning close to a
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not a bad day for fin tech the global x fin tech ticker finx on pace for the sixth consecutive day in the green the first time it's seen such a rally since 2021 sending things higher, paypal beating estimates on the top of the bottom line for the quarter. reporting a new information sharing agreement with investor elliottt who has a $2 billion stake in the game. $15 billion buyback, good pronouncements about cost l scipline and savings we'lkeep an eye on that with the dow up 203 don't go anywhere. ♪ ♪
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our new cnbc survey shows a continued lack of confidence in the federal reserve. over a quarter of owners say they're confident in the fed's ability to control inflation three-quarters saying they're not confident. this is in the face of interest rate hikes 7% say they're very confident in the fed. 74% say they think record inflation will have a negative impact on their business in fact, more than 40% say record high inflation is their biggest threat right now to business, 77% expect inflation to continue to rise. nearly every component in our index this quarter worsened. only a third of owners are saying business conditions are good nearly the same amount expect their revenues will decrease in the next year. most small business owners say we're already in a recession at 57%. 14% saying we will be in a recession by the time the year wraps up all this laying on sentiment on main street.
our index fell to an overall score of 42 for q3 that's a new low in the several years we've been doing this survey and below the previous record low of 43 which was set during the biden administration. back over to you >> kate, historically, at least over the last year or so, hiring, labor market tightness has all been a factor for small business did they talk about that as well >> that's another interesting note on the hiring front about a third say hiring is still a problem. 45% say wanls are rising this is consistent with what we're hearing from the national federation of independent business saying hiring is still an issue, no longer the top issue, inflation is. wages are on the way up. if you look to future plans for hiring, those are starting to slow because many small businesses think we're already in a recession or they're fearful that one is coming down the line so they're starting to pull back a bit on hiring. that's something we're seeing on both sides which is really interesting. >> yeah, it seems to be nearing
the larger peers as well kate, thank you so much for breaking that down for us. currently markets teetering around their highs of the session. that will do it for "squawk on the street." "techcheck" starts right now good wednesday morning welcome to "techcheck. i'm carl quintanilla with jon fortt. deirdre bosa has the day off today paypal surging elliott revealing it has a $2 billion stake. amd and airbnb sliding after their results. a concern for both of those names. another earnings interview, anthony noto, the ceo of sofi will join us in about 30 minutes. investors like the q3 guide. interesting mix of results today, jon >> yeah, carl. we'll start with paypal. shares higher after a beat across the board raisingll