9AM HOUR: Playbook for Q4 and October, Micron CEO Exclusive, Bond Sell-off Accelerates 10/1/26

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0:39and global economic news, monetary policy decisions, and key results and statistics that may impact your trading. Download the latest episode and And subscribe at schwab.com slash market update podcast. Or find Schwab Market Update wherever you get your podcasts. Market moving insight and analysis. Join Jim Cramer, David Faber, and me, Carl Quintanilla, on the opening bell hour of CNBC's Squawk on the Street. Good Thursday morning. Welcome to Squawk on the Street. I'm Carl Quintanilla with Jim Cramer at Post 9 of the New York Stock Exchange. David Faber has the morning off. Welcome to Q4. Market's happy to put Q3 to bed after the worst quarter for bonds in about 22 years.

1:17Smallest gain for the S &P in five. Yields are not budging. Ten years holding 5.3. Brent holding 100 as attention now turns to Europe. And these reports that the U.S. is demanding the EU release some emergency diesel. Our roadmap begins with Q4 kicking off where Q3 left off. And that ongoing bond market volatility. Yields remain near multi-decade highs. The latest in the AI trade. Google with a new frontier AI model. SpaceX set to launch Google AI chips into orbit. and Anthropic poised to become Broadcom's second biggest customer. And then, of course, there's Micron. Blowout quarter, massive revenue gain as memory chips do remain in short supply.

1:56We're going to break that down exclusively with Micron's chairman and CEO, Sanjay Mehrotra, in just a bit. Let's begin, though, with the markets. A new quarter and a new month. In Q3, the Nasdaq was the best performer among the major indices, up two and a half, including some gains from strategy, Palantir, Workday, CrowdStrike. Different story from Micron. Down almost eight for the period, still up 270, of course, for the year. Dow in the red for Q3. Katz now the number one name on the year. IBM Depot, McDonald's, Jim, with double-digit declines. I'm still trying to figure out that latter one.

2:29Look, this is a critical juncture because it's not even narrow. The market is Microsoft and Meta. I mean, typically you'd have at least, and there's three sectors that are good. I don't have three sectors that are good. I do have one sector that has some extraordinary performers. There'll be people out there who say, well, this is ridiculous. Then there'll be other people who say, well, hold it. In 2023, same thing happened. We just had a bifurcation and you had to stay long. The fact that, once again, oil not coming down, interest rates going up, stock futures down, the fact that that has not broken, that that linkage hasn't broken, somehow is a sense that maybe oil is stuck until something happens.

3:14Because it's not that bonds aren't interesting. I mean, bonds are certainly interesting to people because you haven't had rates like this in a very long time. They're better at inflation. They make a lot of sense to buy, except for the fact you're wrong the next day. And when I bought bonds in the old days, I used to swing around bonds. And if you bought 20 million and you were wrong the next day, it was critical. If you buy some now, I mean, It's kind of the same price, but I will be honest, until we get oil, everything's just sin. It's a real puzzle. J.P. Morgan with a great report yesterday, Jim.

3:4890 % of oil flows are back. Right. But 50 % of distillates are back. And so you have the situation where the president today, cover a Time magazine, broad interview, suggesting again that he might resume strikes after the midterms, for example. The market has to fold all that in. Yeah. I mean, why have oil plummet if one month from now oil is going to go right back up? I also know from Herb John Hanson this morning. He used to talk to Herb John all the time, the New York market tankers. He doesn't want to go through. There are other guys who are selective. And he's making a ton of money. He hasn't made a ton of money in a long time because there's just a tax.

4:28It's like we have to spend a lot of money to get it to market. Now, diesel obviously is what's going to impact people mostly at the pump. I mean, it's in the grocery. It's in Walmart. It's in someone raised Target yesterday, but it's in Target too. What I don't get is that they're willing, that the president is not willing to say, OK, look, we have to eat this. You can't tell people there's not inflation and say that their eyes are lying. Yes, we'll get to more of the time interview. But he does. He says, look, inflation does help you pay off debt over time. It's almost a suggestion that he is willing or happy to absorb some level of inflation because of our debt load.

5:18Going with that old Weimar playbook. Yes, yes. By the way, it's interesting time is very liberal. There are a bunch of new ideas for the quarter. Goldman Sachs conviction list is a good example. Amazon, Burrell, Johnson Controls. There are a lot of people trying to suggest things, and I say, you know what? It's narrow. If I had to do my—I've got the conviction list. If I had to do the conviction list, it would be like one page. It would be like, oh, conviction meta. I mean, look, I've been—like a lot of other people, I have been fooling around with news and doing versus Claude. And I will say, and I don't mean to scare anybody, but you don't need a lot of people to do what you used to need a lot of people.

6:00It's just incredible. It's so smart. You can break it down by state if you want to sell something. You know, I was looking at something where Arizona is different from Texas. I mean, you just have to hire 10 people to figure that out. And the speed that it figures out things and offers you a business plan, I mean, you don't want to hit send because it's going to be in your face immediately. I mean, you like it. It's a little, it's daunting, but it's going to change the world. Yeah. Meta, by the way, coming off the best month since 22. Muse, 3 million weekly users now in less than a month. And Deutsche today adds it to the fresh money list.

6:38The beginning of a rich product cycle, they say. Yeah, look, you see, it's so hard. I mean, I want everyone out there to use it. You know, you do have to know how to prompt it. OK, but you'll learn. But these are what it can do is that if you ever wanted to leave your company and start a small business, the big things that are daunting is what your business plan, how much do you think it would cost, how much you're advertising, how much it costs to figure out how much to reach the people in California. Well, how about if I can tell you that in five minutes you'd have that? You know what? You know, you know, I'd be lying because it's two minutes.

7:14Yeah. We used to think that Instagram was a huge tailwind for small business because you could target your customer advertising. That looks almost like ancient in comparison to what Muse is capable of. I just think that, look, if I were Procter & Gamble, I'd use this thing. I mean, this is just a very, very powerful tool. And anybody who doesn't use it, I think, is making a big mistake. Muse for small business is making a very big mistake because you just can take out a lot of costs. There will be competitive offerings, don't you think? Well, I'm told that people are looking at what opening I just came out with.

7:53The dots, people tell me, hey, listen, you've got to check that out. No one I know has checked out Gemini because it's been out for about like 14 minutes. But what's happened is that young people, and I know that this is going to sound like a generational thing, but young people get these things and they show you. I mean, I have a micron analysis that's done by Zach Hodgson for me. Here you go. I mean, look, I said, what firm put that out so fast? And he said, the firm that is Squawk on the street. This is you? It's everything I need to interview. Can we show? It's everything I need to interview Sanjay.

8:27Everything. Everything in there is all I need to interview Sanjay. How long did it take you to prompt this? I'll tell you the truth. It took a little too long because I wanted Zach to get a coffee for me downstairs at Blue Bottle. But he said, no, I've got to finish this thing. So it takes a little less time than it takes to get a cup of coffee. This is ridiculous. I know. Key takeaways, price targets, demand outlook, unit revenue, customer agreements. It went through every bit of research. It went through the two conference calls. It spit out what I needed. I hope Sanjay's ready. He thought you were tough before.

9:07Just wait. Look, this is the new world. And I have, this is what I put together. Okay. This was my Micron file. This is his Micron file. This took all night. This took three minutes. This is better than what I put together. And I know Micron's just 94. Yeah. You want to get to Micron and the quarter itself? Sure. Revenue blasting through estimates. Backlog expands. Actually, let's take a break and we'll do Marotra on the other side. It's much better. I mean, look, I know it's down. People make a judgment, therefore it's bad. You know what? Read my memo. Exactly. We will have an exclusive with Sanjay Murotra.

9:46We'll talk AI in the blowout quarter in a couple of minutes. We'll talk more about the first opening bell of the quarter. What the Fed speak we're going to get today, a huge amount, 10-year, is holding 5-3. Don't go anywhere. with the Discover Cashback card it's payback time when you earn cash back on everyday purchases activate and earn 5 % cash back at different categories each quarter on up to$1 ,500 in purchases that's 5 % cash back at different places each quarter like grocery stores, on gas and at restaurants it pays to Discover see discover.com slash 5 for details weren't agents supposed to take things off your plate building another to handle the others is a bit much don't make more work out of work Gemini is the one agent that knows all parts of your business and actually gets stuff done you give it a project close your laptop and when you come back the job's finished no matter your industry or role your agent has the skills to help every team stay in their flow seriously make work less work with Gemini on Google Cloud check response subscription required.

10:55It's the holiday season at House of Burl, which means that it's the perfect moment to review some key rules. Rule number five, more style means more celebration. Number four, buy gifts, but remember to treat yourself too. Number three, there is no dress code, but always leave them talking. Number two, show off different outfits. No party remains unattended. And rule number one, have it all without spending it all. Happy holidays from House of Burl. Burlington.

11:53Congratulations, Sanjay, and thank you for coming on the show, first of all. Thank you, Jim, and really great to be back on your show again. Oh, thank you. Now, what I want to get at is the gross margins were extraordinary here, and anyone who's followed your company for many years knows that these are, I mean, Andy Grove, who was maybe the greatest semiconductor executive of all time, would have said, this is impossible. Your numbers are impossible. But the streets seem to be unsatisfied. The more I dig into it, I know even since 94, the only time you've had shortfall is when too many companies started putting out chips.

12:25This was not a shortfall. This was your decision to give employees more money. It's literally a bit of a profit share. Can you explain to people the difference between getting so-called hurt in earnings because you decide to pay people a little more versus a flood of new chips that tends to destroy gross margin and profitability? Jim, we delivered an exceptional quarter, exceptional year with$133 billion in revenue, more than 250 % up year over year, with 87 % gross margins in FQ4. And we guided to 86.25 % gross margin, approximately that for our FQ1, the current quarter. So really, Micron team delivered an exceptional quarter.

13:13And of course, you know, commensurate with our record quarter, we rewarded our team members in a record fashion as well with their incentive compensation. That impacted the OPEX in our fiscal fourth quarter. But as the manufacturing workers incentive compensation in fiscal fourth quarter carries into the first quarter's cost of goods sold, it does impact our gross margin. but we guided to a very strong gross margin of 86.25%. Very pleased and proud to be able to incentivize our team members in line with our record performance. It's important for us to be competitive. It is important for us to attract, retain, and motivate our talent so that our momentum continues here.

14:01Jim, memory is key in this era of AI or superintelligence. This memory is what enables intelligence. It enhances intelligence. And Micron has a comprehensive portfolio of technology, products, manufacturing capabilities. And we are continuing to address the fast growing opportunities ahead. All right. So Sanjay, I visited you in August 20 in Boise. You had 26 strategic customer agreements. You since have you had 16. You just came up with 26. How did you get 10 new ones since August 20? Jim, not only do we have more customers and customers wanting to do long-term supply agreements with us, but customers are also, even the customers where we have already strategic customer agreements in place, they are bringing upsides to us for demand.

14:53In fact, we cannot fulfill the demand of our customers. Customers are extending these agreements. Even now, into 2031 timeframe, we did extensions as well as we did new agreements going into the 2031 timeframe. This gives us tremendous visibility, certainty of demand, and that helps us plan our investments in manufacturing capacity with confidence. And, of course, it provides the benefit of supply assurance to our customers and their ability to grow their business with confidence as well. So this just reflects the importance of memory in the AI era. Memory is absolutely critical to be able to scale up AI, to provide value to the end users, and of course provide a strong experience as well, because memory enhances the value proposition of the compute platforms that are being deployed and continuing to advance fast in the AI era.

15:51So, Sanjay, page five of your deck, the strategic importance of memory in the super intelligence era, something that the president has morally binded you to. You have the largest project in America going on in New York, largest project in America. What were you able to tell the president about the fact that you and above everyone in that room putting more people to work? You know, our projects,$250 billion of investment in Idaho, New York, and Virginia to grow memory capacity here, create 90 ,000 jobs. And, of course, working with the communities to even before we had first shovel in the ground, working with the communities, working with the power utility companies, really committing to multiple hundreds of billions of dollars into the community for projects such as transportation, housing, and really engaging with the community with STEM education development as well.

16:52So Micron really responsibly is growing AI and supply for AI. Memory is critical for AI. We were actually very appreciative for the president to have Micron represented in the room the day before yesterday, because memory really is critical for superintelligence. and thankful to the president and our ecosystem partners to find a path to move forward, to take the next step toward growing AI responsibly and safely. And Micron will, of course, play its role in working with the ecosystem partners to enable solutions, you know, to be able to use the memory to drive AI growth safely. Memory will be critical enabler.

17:43when you think about gateways that have to be put in place to interpret the tokens and the framework of the models for safety, memory will enable, faster memory, more memory will enable that those kind of safe operations can be performed at performance that is needed to grow AI. So Micron has a role to play here. We look forward to working with our ecosystem partners and thankful to the president to drive a constructive path forward. You know, I wanted to say that Micron has a core value of speed. And I think what we witnessed at the White House day before yesterday with our ecosystem partners and the president of the administration was a good example of operating with speed to address stakeholder concerns for safety and growth of AI in a responsible manner.

18:34Sanjay, it's been a busy couple of weeks when it comes to share repurchases in the semispace. Does the CHIPS Act restrain your ability to buy back, and do those shackles come off after year-end? We have December 9th is the second anniversary of the CHIPS Act. And Micron, of course, through our technology, through our product portfolio, and the value of memory in this AI or superintelligence era has continued to deliver strong financial results. And we see going forward in an environment where supply is tight in 27 and 28, even tighter than 26. We see an environment of continued, strong, durable, predictable financial performance.

19:21We see well over$100 billion in cash by the end of our current fiscal quarter. So, of course, we will invest in R &D. We will invest in CapEx to grow the supply, to bring innovation and value of our supply to our customers, drive the growth of the business, and then be responsible towards shareholder returns. So stay tuned. Sanjay, stay tuned. Okay, well, listen, you have more money than Apple. You have more money than Nvidia. Why don't you just buy a huge percentage of the company like Sandist did? Because that's the best performer of the year, not you. Why don't you change the equation and just buy it all?

19:57You know, we will, of course, do what is responsible and we will, you know, share more details, you know, after December 9th. But very pleased with the opportunities that are ahead of us and very focused on continuing to grow the business strongly. You know, we announced Micron Research Labs, where Micron is committed to more than$10 billion over the course of next several years to drive breakthrough innovations for a 10-plus year horizon for technology and compute capabilities for semiconductors for the years ahead. And similarly, in the first half of our fiscal 27, we said in terms of capex, mostly going into construction and, of course, bringing up supply in a disciplined manner will be around$25 billion.

20:43That's almost as much as what we invested in full fiscal year 26. So, Jim, we are focused on driving the growth, driving the innovation. And, of course, we will be responsible with respect to share buybacks with our excess cash. Excellent. In one month. the demand increase rather dramatically. In one month, that's what business is Sandre Marocha is in. Sandre Marocha is the chairman, president and CEO of Micron MU. Thank you so much, Sandre, for coming on the show. Thank you, Jim. We'll get Cramer's Mad Dash when we come back. We'll count down to the opening bell. We'll take another look here at the pre-market.

21:18Asia was pretty strong overnight. Nikkei up three, Kospi up two. We'll see if that carries over in just a few minutes. With the Discover Cashback Card, it's payback time when you earn cash back on everyday purchases. Activate and earn 5 % cash back at different categories each quarter on up to$1 ,500 in purchases. That's 5 % cash back at different places each quarter, like grocery stores, on gas, and at restaurants. It pays to Discover. Terms apply. See discover.com slash 5 for details. Weren't agents supposed to take things off your plate? Building another to handle the others is a bit much. Don't make more work out of work.

22:01Gemini is the one agent that knows all parts of your business and actually gets stuff done. You give it a project, close your laptop, and when you come back, the job's finished. No matter your industry or role, your agent has the skills to help every team stay in their flow. Seriously, make work less work with Gemini on Google Cloud. Check response, subscription required. It's the holiday season at House of Burl, which means that it's the perfect moment to review some key rules. Rule number five, more style means more celebration. Number four, buy gifts, but remember to treat yourself too. Number three, there is no dress code, but always leave them talking.

22:39Number two, show off different outfits. No party remains unattended. And rule number one, have it all without spending it all. Happy holidays from House of Burl, Burlington. there's a look at the 10-year 532 this morning got to 534 overnight obviously much very much a global story the french 10-year its own 24-year high germans as well multi-decade highs we'll keep an eye on all of that and what it means for housing which actually gets initiated over at morgan stanley today opening bell in about four minutes don't forget you can catch us anytime anywhere just listen to and follow the squawk on the street opening bell podcast let's get Kramer's Matt Dash as we count down to the opening bell.

23:21This is a piece about Apple this morning out of Morgan Stanley, an exciting roadmap, but tactically full valuation does talk about how maybe the stock has moved too much. This is good research, but I'll tell you what it's lacking. There are only five mentions of the duo in this piece. Five. The duo is revolutionary. You're looking page after page after page. Nothing subs to the duo. Why? Because they are limited for this first year. I think that you buy it off this if it comes in because the duo will not have five mentions in the next piece you read from Morgan Stanley. Yeah, I saw some research out of CounterPoint.

23:57I think they were thinking of maybe six million units on the duo for 26. Does that get there? I think that they're going to be very constrained because I think the October demand that you're going to find out, you've got to hope that it's there for Christmas, for holidays. I don't know. but I would say they say the Mac is the star, bright spot. I mean, that's nice. That's quaint. The next piece I think is going to have to change its name and just be called Duo. Duo. Because Duo is what's going to move this side. Thank you, Tim Cook, for turning us. You've actually had your hands on it, so we're going to have to take your word for it, Jim.

24:35I mean, when Nixon went to China, he went to this little figurine room, and at the end he said, I want to check everybody's pockets. He took one. That duo, I almost had that come with me, but I haven't taken it. Watch Apple. Let's get the opening bell here this morning at the Big Board on Wall Street. It's the Ireland Fund. A philanthropic network supporting causes across Ireland and around the globe celebrating 50 years. At the NASDAQ in Times Square, it's drone manufacturer Powerus celebrating the completion of its merger with Aureus Greenway Holdings. And at CBO in Chicago, it's the Susan G.

25:09Coleman, Greater Chicago, marking the start of breast cancer awareness. this month. You had a great charity, Norman Brinker, of course. They were together. I will say that when I look at this market, Carl, and I watch the sickening decline in Micron, I said to myself, I care more about Korea. If Korea's up, they'll buy Micron. And Korea was up, so they will buy Micron. Yeah. And nice little flag on the Nikkei, too, as we said, up 3.3 overnight. No, I mean, look, we're at markets that basically are right now because because Micron is big but not as big as SK Hynix and not as big as Samsung. If their stocks go up, what they're saying basically is we're all in the same boat.

25:52And what Sanjay, I wish he had been, Sanjay's not promotional at all, but I would have said if I were Sanjay, look, we are choosing how much we're going to sell forward. Maybe we sell 30 % forward in 2030 because we think 2030 is going to be so much higher. Let's just let it roll. So you have to understand that the long-term agreements that they have are really a floor for what they can earn. And a lot of people, I think, think they're a ceiling, and that's a misread. And the fact that he gave the employees more, which is something he did not talk about when I was there, is not a reason to sell this stuff.

26:23Yeah, so you do tie it to the gross margin number and this employee comp. But what is it supposed to have, gross margins of 100 %? It's unheard of. I remember when Andy Grove once told me, I said he was at 64%. I said, how come you can't do 70 %? And he said, well, if you studied, then get back to it. Yes. We do have news, Jim, within tech on Google as this Gemini 4 Argon is released. The leapfrog there continues. This prospectus reporting on Broadcom Anthropic is also interesting. Yeah, that's a big win for Broadcom. But I guess someone would say, well, they're paying to use it. That's Hawk Tan, who's in bed with the president.

27:02He's a little more difficult to read. But I got to tell you, if he did that deal, he's the best when it comes to the numbers. If he did that deal, that's a fantastic deal. And I've liked Broadcom. Last quarter, not that good. People didn't like it. And best so people know, when you hear who's buying what, Tencent did a deal with Oracle to buy chips. Those are NVIDIA chips. You have to try to look through all these deals to figure, all right, whose chips are who? Broadcom makes them. They're a big competitor to NVIDIA. Oracle doesn't make them. Those are NVIDIA. You have to keep track of what NVIDIA really makes versus what people want to say.

27:38Yeah. Because other than Elon Musk, who just says, yeah, I'm an NVIDIA house, most of these people are trying to claim that Jensen Wang is not their man. Jensen Wang is the exception of World Cup. You know what's having an amazing week is Synopsys, Jim, on this Investor Day and some of the numbers that are getting second looks. That's going to be a huge outperformer this week. That was one where it fell apart, and I was like, I couldn't believe it. I said, I don't know what's the matter with it. And it turns out there was nothing the matter with it. But we had a lot of stocks that just people didn't understand.

28:14That's electronic design automation. As Jensen explained to me, they come up with a plan at NVIDIA. Then they give it to Synopsys, and then Synopsys gets it to Taiwan Semi. So they're not a gating factor. They're a partner. And I don't understand why people don't get that. You have to have them really the architect. Highest level here since June. That's a 25 % gain in 10 days on SNPS. There's still a lot of stocks that are trying to recover from situational awareness where people just said, why was that stock down? And the principal one that I think was really, we all thought was definitely after situational entrepreneurs in trouble was a company called Accenture.

29:02Accenture is pretty interesting today. 86, I'm sorry, 329 is a beat. Revenue ahead. We're going to talk to Julie Sweet in the 10 a.m. hour. This Anthropic partnership, again, it comes back to Anthropic, which the president also mentioned in Time magazine, said that Dario was actually a smart guy and maybe underestimated him. Yeah, there's a lot of controversy that happened with Dario, whether Dario capitulated or whether Dario, did he get a little more conservative? Is he more with Jensen? You have to speak with Jensen. You know, these things are, when you meet with the president, the president tends to tell you what he's going to say.

29:40And then sometimes he says different things after he tells you that. So is Accenture, is that a corollary to the canceled Saskopolyps that we talked about in recent weeks? There it is. Nothing else to say. Yep. I mean, look at Mark Benioff. I mean, he was supposed to be Saskopolyps better than anybody there was. And, you know, I just I am shocked that people don't realize that Salesforce has made a major change in terms of the stock, not the company. But the best one is Microsoft. It turns out that Microsoft is back, but they're so quiet. We don't know why. And the answer is because they're selling a lot of product and because Azure is accelerating.

30:18Yeah. By the way, I would also say they're not going to say it on the call. They're making a ton of money in AI or Super AI. They're actually making money. Well, we got the new co-pilot on last Friday. Today, Wells adds it to its Q4 ideas list. 520 here as we got past 515 yesterday. The companies that spend, Jensen Wong said it'll be four years before you start making a lot of money if you buy our stuff. Amazon shortened that. Amazon told me if it's going to be next year, I think that's going to be ahead of that. I think Microsoft's making a lot of money. I think that Meta's going to make a lot of money because of Muse.

30:56And what's happened is we are beginning to see the return on the build-out. And if you have Constellation, be you're a nuclear power company, then you're going to get a good price on that. It's happening. And no one wants to come out and just say, you know what, this thing's big. They just want to say, right, we're spending a lot of money and there's not going to be a lot of return. That's wrong. So if you're right, and in the next six months we start to get more granular data on the return, on the spend, Does the money go to the users or stick with the vendors as it is right now? Boy, that's a good question.

31:33Right now, it's the vendors. Constellation does a 20-year nuclear power purchase plant with Amazon. Amazon's just going to make a fortune. Now, they may have to plow it back to have even more compute, more compute, more compute. But the world is their oyster because they spent the money. And it's really a shame. The narrative was a year ago, they're bankrupting, they're ruining their balance sheet. The narrative now is, I can't believe how much money they're making already. And that the length of time of a data center is not four years, but it might be eight years. It might be 10 years because the NVIDIA chips last so long.

32:07So let's just scrap the narrative that says that they wrecked their balance sheet, now they have no home, and start thinking about the line item, about how much they're making. Kind of reminds me of this interview Andrew did with Brian Chesky of Airbnb, which ran this morning. Airbnb got re-rated on their AI use, and Chesky has talked about how he's become somewhat of an expert on the use of AI. He's got some remarkable insights. Take a listen. We need to basically take the language from doomsday down a notch. I think that the way we talk about AI in Silicon Valley is really bad. We use words like superintelligence.

32:45Superintelligence sounds like an alien species. The average person does not want an alien species smarter than them. I think the average person feels like AI is happening to them, not for them. There's very few consumer applications in AI that are actually improving people's lives. Most AI is enterprise. People hear that as job automation. Anti-AI is unfortunately becoming a bipartisan issue. So that's going to be an interesting development, Jimmy. He actually argues that maybe chatbots are not the best interface on some of this stuff for the consumer. That's true. And we did recommend this stock very hard as part of this.

33:29We looked over your Ennui, the consumer Ennui issue, and I think that this one is probably one of the best to buy. I think it's a great company. The stock got hit very badly. We're looking for, we think that Muse is great for if you want to find out, put me a ticket to so-and-so. So it's a corporate product. It's an enterprise product. And you pay for it. Look, it's a shame. I mean, it came out as a consumer product, and that's good. But there's 200 million small businesses, and I think you've got to go with them. I think that you've got to realize what you've got is a small business enterprise situation, which means why Meta stock can go to$1 ,000.

34:09$1 ,000 on Meta? Yeah, well, it's not just a consumer company. I mean, when it was$5.50 in the summer, you said the cloud business was worth maybe$100. I haven't even included that yet. This is a different company. It's a different company. I've been working with this dean of Pal McCormick on what they're doing. This energy product they're putting up. They come into a town. They say teachers get big bonus,$50 ,000. We're going to change the electric. We're going to lower it. Let us in. And they're killing it. But you needed to have someone who was in charge of$10 ,000 small business when she was at Goldman Sachs.

34:47Right. By the way, that Morgan Stanley guy who cut the price story. On what? On Apple? Yeah. He's been, it turns out he didn't like Dell. Apparently. I don't want to reveal where he didn't like Dell because it's not fair. I don't know him and I don't want to ruin his weekend. Yeah, that's piling on. It's just, I'm a kind man. I'm a good man. That's up from the apocalypse now. You mentioned consumer on We, Jim. We are getting Nike tonight. Yeah. We do have an upgrade of Dollar Tree out of Loop. I like that. On a consumer where purchasing power gets pinched. I like that. I have a Dollar Tree that I went to several times this summer.

35:26And the pricing really was ridiculous. I mean, I think people should go there that they needed workers and they offered good prices for people who want to work there. But it is exciting. Dollar Tree is exciting to go to because you can't believe the price. Yeah. As for Nike, I'm not sure what you're – I mean, we've been waiting for this quarter for a while to get some clarity on the quarters to come. My concern with Nike is, you know, they don't seem to have anything going in China. U.S. had been stronger. Now it's not as strong. Yields 4.5. It still sells at 21 times earnings. When they finish with these, they tend to sell at 15, 16 times earnings.

36:05When they're really done and they really hammered them, they go down to 11 times earnings like Dix, which bought Foot Locker. It's just a very crowding group. Yeah. Very proud. Elsewhere in consumer, these comments from Ted Sarandos of Netflix. Wasn't that surprising? The company's not growing as fast as he'd like. We do have the Peace Guy thing. Looks like it's going to get done by October 6th. This young Christ going as co-CEO. Yes. By the way, I'm glad to see that Netflix isn't hammered on that. I've met Ted several times. Ted is a guy, he's just not promotional. I mean, he just says, listen, we're doing well.

36:45They're a very candid company, and sometimes their candor, it's never misleading, but it does say what the stock is doing. I don't think he's looking at this and saying, let me tell you something, it's really bad. I think he says it's not been great, and that reflects the stock. Yeah, meantime, Disney is the worst Dow name at the moment on some of these jitters about media overall, Jim. Look, there's, I wish I could tell you that I found someone who has anything positive about media. I really can't. And I think the biggest disintermediation is that you can do so much with meta if you want to reach people, even large companies, that it's very hard to figure out what your TV budget should be.

37:31Very hard. Yeah. I remember the P &G CEO was here on set a few months ago and said the marketing spend has been completely turned upside down. Completely. You don't buy commercials anymore. No. And I remember one of the smartest guys in the business, and the stock's not reflecting at all, which is probably really wrong, but Jersey Mike's, you have a guy, Charlie Morrison. I know the market seems high, but the numbers really come back. And the stock's been very disappointing. It went from 25 to 16. But I have to tell you that their strategy on TV is they're not going to spend as much money. And that's where their big expense is.

38:08We talked about housing a moment ago, Jim. There's a piece in the journal. You've got high rates and high costs. And then in the journal's view, it's left homebuyers out of moves. This Morgan Stanley initiation of the sector is interesting. their only overweight is tall. Well, tall is 25 to 27 percent cash, and the average buyer can put down a very big down payment. That was something Doug Yearley schooled us on. The other guys, I don't know. You get a 3 percent, you get a 2.5 percent mortgage five years ago on a 15, and now it's double. On the 30, it's double, and it doesn't make sense to sell your home.

38:44It just makes sense to cram the kids into the same bedroom. It's an amazing 40-year decline in the amount of business being done. We did get a print on the 30-year fix yesterday at 7.6, closer to 8 than it is to 7. And then, of course, refis last week were down almost 9. I mean, who's going to refi in this environment? I'm not a big fan of the PRC, but they offered a very good low interest rate. They did help their homeowners. Yeah, and I think that the president should say, you know what, they offered 1%. We're going to offer half percent because we're not going to let the Chinese beat us when it comes to the rate that you can get for a homeowner.

39:22You ought to do that. That would be really good. Kind of leads us to financials. We're a couple weeks away from earnings to begin. We talked about them going red for the year. Worst month, I think, Jim, since 23. Wells Fargo back then. I challenge ourselves to Wells Fargo. It's been a great stock until recently. I would tell you that the banks don't have a lot of M &A. We see all the order cancellations and IPOs. Goldman Sachs has been a textbook about how bad things the stock is, reflects some of the problems. The only good news is that everybody knows that it was lousy. So if you did have an end of a war, this is the good button.

40:07Yeah. And how many times have we gone into the quarter coming in hot? Uh-oh. Right? Oh, I know. I mean, look, J.P. Morgan had a really amazing quarter last time. And it's come down from$366 to$329. I wish it were$300, and then you could really just crush it with it. But it's a horrible group. The charts are horrible. The commentary is horrible. The book of business is horrible. In other words, buy it? No. No, I can't. No. No. Yeah. I mean, there was a note today out of B of A arguing that the consumer is poised to start doing a lot better, at least at the low end. You look at after-tax wage growth at the low end.

40:47That K, they argue, is going to start to converge. Brian Winahan, Bank of America, said the same thing. You know what? If I had to actually, look, I happen to like very much Citi. But I would say that, with Jane Friedrich doing a great job, Bank of America at 11 times earnings down for the year. I mean, that's a cheap stock. It's a good company. By the way, these are good companies. I mean, I know that we're all supposed to be in buy now, pay later, and we're supposed to be able to do all the square, which block. But in the end, the average American has a bank account. And yes, and Goldman today, household net worth as a percentage of income, all-time highs are awfully close.

41:29No, so it's just that we don't have any homes to buy, and we're scared every day because of Iran. But the president doesn't seem to, it doesn't weigh on the president. But a lot of businesses are going to say, you know what, what am I going to do? I go public and then the next day, Iran shoots a missile at a tanker and my stock is going to be down 25%. No one wants to be in that market. I mean, Jersey Mike's, his stock is down horribly. All they do is do well. We did get a call out of Citi on Bitcoin, raising their, I think, their target to 113K. They were prior 82. Well, that's a lot. I mean, your interest in Bitcoin has waned, I think, over the years, maybe.

42:13I still have it. You do? Yeah, I was going to get rid of it. But my kids, I don't talk stocks with my kids. That's separate. But my kids said, Dad, you're kind of off the mark with that stock thing. They don't watch the show. They don't like stocks. They don't want to hear about, Dad, Bitcoin. I mean, okay, okay. I mean, name what they inherit, the earth. What do I inherit? Yes, yes. I know what they inherit. One last bit. You mentioned energy. We got a couple calls. One's on Oxy today. Goldman goes to buy 69. And Wells cuts Exxon to equal weight. I thought that was punitive. You know, look, I do like Chevrolet much more than Exxon.

42:54And they like BP more than Exxon. Well, BP is really interesting because it's down so much. And so it's kind of a catch-up trade. I don't know why you look at these all trade together. The analysts all try to make them distinguish. But BP, it's six times earnings. If you want to value stock, I would go with BP. And also making some internal changes, structural changes. Yeah, look, it's a good company. I don't know. Some people feel it's got a little. It's too anti-bossil fuel. I don't buy that Dow. Pretty steady open here on the first day of the quarter. Dow down four. S &P up seven. We'll keep our eye on Treasury.

43:30We're going to get ISM at the top of the hour, along with some construction spending. Claims were pretty good. $200K versus a prior$197. Tenure there at$3.23. Stay with us. There's a look at some names doing well at this Open. There's AMAT up, as you can see, up more than three. KLA's not far behind here, Jim. That's why my crunch should be up. I mean, the market's so stupid. It's all right. It's a stupid market. Yeah. Well, you know, you got NVIDIA up more than a percent here. Well, that's true. All these companies are the great intellectual property of America. And those stocks are up because the orders are really, everyone's trying to get more.

44:09Everyone in Micron's trying to get more. SK Hein, they all want more because they have so much demand. But Sanjay, you know, he's not promotional. There was a way to be able to come on the show and just say, listen, you want chips? See you later. But that's not Sanjay's way. Yes, yes. Yeah, that was definitely the message out of Micron's quarter. The price action notwithstanding. We'll get to stop trading with Jim after a short break. Let's get to Jim and stop trading. Carl, I love stocks, and I've always tried to know every single stock that's public. I've been doing it really since 1982. There's a piece out Wells Fargo today, 13 high conviction, catalyst-driven ideas.

44:44You have to be, I mean, I have to admit I know them. I also have to admit that nobody else does. I mean, it just shows you what, except for Microsoft, the extent with which you have to go to find ideas that are good right now. Well, OK, well, Axum is good and Ferguson is good. And don't forget Fifth Third. And Chimera is really good. And, you know, you really want to be in Viva Systems. I mean, and Roblox. It's just not easy to find ideas right now. And this is all because oil equals rates equals dam. And I just think that this is emblematic with someone at Wells really trying hard to come up with tactical ideas.

45:19And the number one is C.H. Robinson Worldwide. I mean, you're talking about a company that's buffeted by everything that's wrong in this country right now. So I applaud them because they have bad ideas that could really take off. But, oh, my God, can I please have some names that I know? I mean, you name it. Energy, Amazon competition. Fergie. Fergie. I mean, I remember that. Honestly, yes. So I just pointed out that a lot of the analysts are a little stymied here about what to recommend. And I will say there's a level today where you might say, I want to own Micron. But, you know, right now people say, eh.

45:56Yeah. We'll see. A long quarter ahead, that's for sure. Long day ahead. Yeah. We'll see you tonight. Thank you. Mad Money, 6 p.m. Eastern Time. You've been listening to The Opening Bell on CNBC's Squawk on the Street. All opinions expressed by Squawk on the Street participants are solely their opinions and do not reflect the opinions of CNBC or its parent company or affiliates, and may have been previously disseminated by them on television, radio, internet, or another medium. You should not treat any opinion expressed on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion.

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