Back to School Phone Policies & Ukrainian Stock on the Nasdaq 8/2925

0:00Bring in show music please. This is Squawk Pod, and I'm CNBC producer Cameron Costa. On today's episode, school is starting, and so is the debate over whether students benefit from having their phones in class. Yale lecturer Joanne Lippman on one side. When the pocket calculator first came out, they were banned from schools because kids will never, ever learn how to do math. So my point being, historically, every time we have these new technologies, there is a lot of fear about them. And then ultimately, we learn how to use them as tools. And on the other side, member of the Smartphone-Free Childhood U.S.

0:44Council, Emily Boddy. We really need kids to develop skills before screens. So there's critical thinking skills that come into play that will enable kids as they get older and their brain develops more to be able to use these tools more effectively. Did you know the U.S. markets have an opportunity to invest directly in Ukraine? The country's largest digital and telecom operator, Kyivstar, is publicly traded on the Nasdaq in New York. And CEO Alexander Komarov joins our set. This is a kind of proof that country can develop in very, very difficult circumstances. Those conversations, plus an orp chart restructuring in tech thanks to AI, and today's court hearing of Federal Reserve Governor Lisa Cook's lawsuit to block President Trump's effort to fire her.

1:33The story of the week, it just kind of keeps developing. It's Friday, August 29th, the last trading day of August. Squawk Pod begins right now. Stand, Andrew, five, three, two, one, up and Andrew, two. Good morning and welcome to Squawk Box right here on CNBC. I'm Andrew Ross Sorkin, along with Leslie Picker and Wilfred Frost in for Joe and Becky on this final day of August as we get ready for the sprint, guys. I always think between Labor Day and basically Christmas, that is the sprint of the year. But we've had kind of a sprint this week, it feels like, given all the news. And it feels like it's a lot more coming at us.

2:15It's not just the final day of August, Andrew. It's your final day with Leslie and I. Yeah. Which I know makes you sad. We're going to have to do this again. A little bit of tears. Can we make this a regular thing? We can. And how about this as well? Every August. Every August. You know, people think it's the dog days of August, but this isn't that. And how about this, Andrew? Will you come and join me on my new breakfast show on Sky News in maybe a couple of months with your book coming out? You have a deal. We've already, there's been a handshake on that. I know. I know. So luckily. Now we sealed it with a live broadcast commitment.

2:49Luckily, there wasn't a polymarket on it. It wasn't insider trading. It's just been a deal that we're now publicly announcing. Well, we should have put it on. We could have put it on Calci and then maybe had a separate separate side deal. More big news out of the Federal Reserve. Federal Reserve Governor Christopher Waller saying he hopes the Fed cuts interest rates next month and expects more reductions in the next three to six months. Now, Waller telling that to the Economic Club of Miami based on data, current data, that he says supports a quarter percentage point cut at the Fed's September meeting.

3:23He said he's concerned that labor market conditions could weaken quickly and says he doesn't want the Fed to be behind the curve. He noted he doesn't think the central bank needs to cut rates more than a quarter percentage point in September. He said that could change depending on next Friday's jobs report. Waller saying it's time to move monetary policy to a more neutral stance, which he said was around 3 % on the federal funds rate. So a lot of folks are going to key off of that. How much influence he has over Jay Powell are not unclear, but given sort of the conversations around his name, possibly even being up for the Fed governor, he may actually have more influence over this than we may be.

4:03It's maybe worth listening to what he's got to say in this context. Yeah, absolutely. And he, along with Bowman, Mickey Bowman, were the two dissenting votes last month where they said that the Fed should be cutting rates, ultimately decided to hold them steady. And he's been obviously, you know, in favor of easing for a long time. But to your point, you know, we hear about the prospect for rate cuts and all against this backdrop of kind of the politicization of the Fed, what it means in the context of this week's developments, what it means for kind of the credibility as inflation fighters and the dual mandate.

4:42And I think it's something that we'll be talking about for a while, just how much the uncertainty kind of filters into some of these decisions. What I love about this is for the existing members who are in the running to be Fed chair, they have to lay out their case, but with much greater kind of guardrails around them in a way that David Zervos can come on Squawk Box and be an uber dove and embrace all of the sort of angles that the president might want to hear. obviously for people like Waller, you have to be a bit more careful, but still set out your stool a little bit. But I think the implication for that is you kind of know for certain these sorts of members are not going to flip and be hawkish.

5:29Maybe that's a little bit too kind of skeptical of me. But I think if you're in the running, you're going to want to keep saying the right things for the foreseeable months. Right. A hearing, speaking of, is set for later this morning on Fed Governor Lisa Cook's request to stop President Trump from removing her from office. Cook sued Trump earlier yesterday, claiming the president has no power to force her to leave. The administration is claiming Cook committed mortgage fraud related to homes in Michigan and Georgia. It's unclear if those allegations are true. And Cook's lawsuit suggests a clerical error may be to blame, but the move has generally been viewed as a pretext to get rid of an official appointed by former President Biden who might not be as supportive of President Trump's call to cut interest rates.

6:19Last night, Federal Housing Finance Agency Director Bill Pulte saying he had filed a second criminal referral against Cook with the Department of Justice relating to a mortgage on a property in Cambridge, Massachusetts. sits. There was a really interesting piece in the journal this morning about just, OK, so there are all of these different allegations of mortgage fraud. What were the mortgage agencies doing prior to this? You know, why didn't they catch it in the first place, essentially? Why didn't they have flags that would have, you know, raised the alarm when this when this actually occurred?

6:54Why is it all kind of coming to light now? It's really interesting to have her pushback, though. I mean, we've kind of been waiting for this all week, Andrew, haven't we? And clerical error is the response. And, you know, there's lots of other really interesting detail. And I know we've got some legal experts and Steve Leisman coming up in this filing. And obviously, we're going to get the ultimate ruling before too long. And there's lots of legitimate areas where, you know, obviously, fraud has not been proven, which one can understand in Lisa Cook's position, you feel would have to be done before any of this.

7:27But clerical error, it's basically saying, I think, my reading of it, oh, I signed it, but I didn't mean to, almost. Or I filled out the form wrong. I mean, it's quite interesting. What do you take? Look, my take is it's troubling that there was not a more vociferous defense if there happens to be one. It sounds to me like there may not be one, the clerical error. There was another word where they used the phrase erred. that maybe was an aired, E-R-R-E-D. That unto itself, to me, I think even in this position, putting aside the criminality element of it, if you're on the board of governors, you have a responsibility, even perhaps more than most American citizens do.

8:10And so having said that, by the way, we have not prosecuted, or by the way, there's an AG who had this issue in the United States who has the job today. So, you know, that's when you get into this idea of is this being weaponized? Last night, this new Pulte claim I thought was a stretch. So the first claim seems pretty clear cut given the documentation that's out there. It would be nice to hear what she actually has to say about it, and I think we should wait to hear that. But you'd want to know. Last night's claim was different. Last night's claim was that she had bought another property, claimed it as a second home, and then all of a sudden later it became an investment property, meaning that she was renting it out.

8:52There are lots of people in America who plan to buy something as a second home and then ultimately turn it into a rental home. And your decision about knowing what you're doing on day one versus knowing what you're doing even 10 days later is often different. So that one, for me, feels a little bit more of a stretch. Hulte's pulling that property into this mix in part because it was something that took place while she has been on the board of the Fed. So I don't know. We're going to have to watch this. And obviously, we're going to talk to Steve and so many other people about this later. Yeah, really, really interesting.

9:26It's been the story of the week. It just kind of keeps developing. Alphabet, Amazon, Meta, and Microsoft are all slashing middle management, part of a broader shift in how tech operates in the AI era. Mackenzie Sigalos joins us now with more. Mackenzie, this is so interesting just in terms of organizational structure for these tech companies and kind of what makes them more nimble in this AI race. Hey, good morning, Leslie. So building on your reporting on this exact topic earlier in the week, I spoke to the team at Stanford that's tracking real-time payroll data from ADP. And they found that the jobs most exposed to AI, like coding and accounting, have seen a 13 % drop in employment for workers under 25.

10:09And losing that bottom rung, they say, is a warning sign of disruption that's moving up the ladder. And we're already seeing that show up in big tech. CNBC's Jen Elias learned that Alphabet cut 35 percent of its small team managers in the past year, a shift that's echoed at Amazon, Meta and Microsoft. Mark Zuckerberg has long pushed to cut bloat. And at Amazon, Andy Jassy said the corporate workforce will shrink as generative AI tools take hold. He also told employees there were too many pre-meetings for the pre-meetings and ordered a 15 percent boost and the ratio of individual contributors to managers.

10:44A Yale professor studying the corporate organizational behavior calls it the great flattening, where the goal is fewer layers between top execs and the people actually building product. Google's former HR chief under Eric Schmidt tells me that hyperscalers are likely cutting staff to fund chips and their very pricey AI engineers, but he also warns that gutting entry-level roles now will leave a hollowed-out pipeline and a shortage of managers later. Leslie? Mackenzie, it's all really fascinating. There's a great book that I read earlier this year called The Geek Way by Andrew McAfee, and they talk about these principles that some of the most successful tech companies have employed in order to be successful in terms of their organizational structure, one of which is ownership and kind of giving employees more control over their daily lives, cutting out some of the middle management.

11:33And I just wonder, as we think about some of these companies and how they're shifting the way they think, they've gotten really big and successful because they've employed some of these principles. Do you feel like those are now changing as a result of the technology and just the ultimate pressure and capex spending and everything that's happening? It needs to be even more flat and nimble than kind of the structure that's gotten them the success so far. So with Alphabet, it's almost been this boomerang effect where under Eric Schmidt, he introduced something called the rule of seven, where you couldn't be a manager unless you managed at least seven people.

12:09And that was designed with a view to basically spread them out so they didn't become bureaucrats, spread them a little bit thin. So they aggressively strayed from that. And we're seeing that show up with the kind of cuts that they're making in the past year. But to your larger question, is it a shift in technology that's behind this rethinking of the org chart? And it really is a combination of factors. I mean, this began in 2023 during Mark Zuckerberg's year of really returning to efficiency, something that Wall Street has rewarded the stock for after a punishing stretch. And that was about expediting the decision-making process, really looking to compress that layer that separates the top executives who are making decisions from people who are actually building the tech.

12:52And now the people that they're hiring, spending hundreds of millions of dollars on these advanced AI engineers, they want to really connect them with those who are in a position to expedite product decisions in this expedited race. And so some of the decisions at Amazon, for example, looking to compress that ratio of managers to individual contributors, Morgan Stanley says that could lead to 14 ,000 cuts in management roles under Andy Jassy. Yeah, I feel like one day it's going to flip and it's going to be the managers overseeing like seven AI agents or AI bots, and there will be no just kind of player employees there.

13:32Mackenzie, thank you so much for following that story for us. Mackenzie. Cheese will be next. Next on SquawkPod, Ukraine's largest telecom and digital operator, Kivstar, recently went public on the NASDAQ, VSBAC, and we'll talk to the CEO about doing business amid a war. It's a quite difficult background. It's a war in the country. But I think that we are moving, we are developing, so we are going ahead despite the very difficult circumstances.

14:11You're listening to Squawk Pod from CNBC. You're watching Squawk Box right here on CNBC. I'm Andrew Ross Sorkin, along with Leslie Picker and Wilford Frost. The sprint seems to always begin post-Labor Day. Here we go. For some people, it's already begun, I think, given some schools already begun. The telco company, Kyivstar, made its public debut earlier this month on the Nasdaq via SPAC, marking the first time a Ukraine company has gone public on a U.S. exchange. Joining us now on a first on CNBC interview is the Kyivstar CEO, Alexander Komorov. The company is ringing the bell at the Nasdaq this morning.

14:43A very good morning to you. Congratulations. Good morning. Thank you very much. Is it hard to feel elated, whether it was the SPAC listing or ringing the bell, given what's going on back home? No, so it's a kind of major event for the Ukrainian economy. This is a major event for the company. So I think that we are proud. At the same time, of course, this is a quite difficult background. It's a war in the country. But I think that we are moving, we are developing. So we are going ahead despite the very difficult circumstances. And this is a kind of proof that country can develop in very, very difficult circumstances.

15:14Why did you list when you did? I think you've got a big majority shareholder, you didn't need the capital despite the tough time, it was a SPAC listing. What was the thought process? We have a thesis that actually that direct listing of the operational companies of the Vion holding group will be able to unlock value for the shareholders. And as far as I see right now, we have proven that it is a kind of true. You know, since the beginning of our listing, the value of the company grew around 20 percent. OK, and I think this is a kind of fundamental result. And also it has been proven through the very low redemption rate that we were able to achieve through this process.

15:53Where is your coverage across Ukraine? I mean, obviously, a telco company, you've got mobile, fixed line, and there's a deal with Starlink that we'll come to. and how would you think about continuing to serve customers or continuing to use spectrum you might have in lands that are sort of controlled by Russia at the moment or might become formally part of Russia how do you think about that we are servicing only territories that are under control of the Ukraine okay and we are trying to consider ourselves as a digital service operator rather than telco, pure telco provider. Because right now, what we have is a mobile telco, we are market leader, we have fixed broadband, we are also market leader, but we are also developing a number of digital services like AdHealth, digital health, like right hailing, we are market leader, like entertainment, we are one of the market leaders.

16:49So we position ourselves as a digital service provider with a telco license. And we are servicing the whole Ukraine. As an example, we have access to half of the Ukrainian households with our fixed broadband infrastructure. We have coverage 98 % by population with LTE technology. And with the Starlink addition, we will be able to cover 100 % of the territory with first OTT messaging and then with mobile broadband services through satellite. So Starlink you see as a partner, not a threat to your business, but more importantly to Ukraine as a whole, there's been a lot of coverage of this. Would the war effort have been possible without Starlink support?

17:29Starlink is an essential element of the Ukrainian national security for the time being. And I think that direct-to-cell services will strengthen, actually, not only humanitarian aspect of the telco services that we provide to our customers, but also a security aspect that are important during the war. In terms of what's likely to happen in the short term, whilst we've got you, I know you might not want to get into the politics, but clearly there's a big gap between Russia and Ukraine in terms of what would be required to reach a ceasefire or a peace deal. Do you think it's likely this year, next year or not?

18:08I don't want to speculate. I'm very much focused as a CEO of a big critical infrastructure and critical service companies. I'm trying to be as prudent as possible in my forecast, in our forecast. So that's why we do not provision end of the war this year or next year. So we rely on our ability to run and to develop business in very difficult circumstances. And it seems to me that we have proven this ability because we have demonstrated gross marginality during all three and a half years of the full scale war. Can I ask you in sort of a different way, which is obviously you chose to go public via SPAC here in the U.S.

18:47Can you explain your reasoning for listing in the U.S. on the Nasdaq as opposed to anywhere else in the world? There are two rational arguments. The first one, our parent company, Vion, is listed on Nasdaq. The second one is a special condition that we are assigned between Nasdaq and Ukrainian government. And the third one, we are making history. We are the first ever Ukrainian entity to be listed on the American stock exchange. Do you think it helps long term, obviously talk of a minerals deal, does it help long term the idea that America will help protect or the West will help protect Ukraine if more Ukrainian companies list here or list in London or the like?

19:31Do you think that will help or not? I'm sure yes. I'm sure yes because I think we should strengthen our security cooperation. We should strengthen our cultural cooperation. But it is also important to strengthen our business cooperation. As an example, Ukrainian-American Chamber of Commerce is one of the strongest in the Eastern Europe, because we have a lot of American businesses that are present in Ukraine for the time being, that are developing business, that are investing business. Kyivstar is one of the examples. We committed to invest 1 billion US dollars into the Ukrainian economy from 23 to 27.

20:04And we are progressing with this. Alexander, thanks so much for joining us. Congratulations on ringing the bell today and more broadly, good luck. Thank you. Thank you very much. Coming up on Squawk Pod, a debate taking place in schools and in homes as we start this new school year. Access to phones during the school day. Journalist and Yale lecturer Joanne Littman. There's a study in Singapore that found that if you take phones away from the students, it actually, their performance, academic performance declines because of their anxiety. and member of the Smartphone-Free Childhood Council, Emily Boddy.

20:46We find that students relax into the day more easily, knowing that everyone's phone is put away.

20:59You're listening to Squawk Pod today with Andrew Ross-Sorkin, Leslie Picker, and Wilfred Frost. Here's Andrew. Students heading back to school, a national debate heating up over whether cell phones belong in classrooms, with more states moving to impose new restrictions. This upcoming school year, 35 states have rules limiting phones and electronic devices in schools. Joining us right now to talk about is Joan Lippman, a Yale University lecturer and a CNBC contributor. Also, Emily Boddy, a smartphone-free childhood U.S. council member. I want to thank both of you. It's great to see you. There's a big question about this, and I know a lot of parents go back and forth.

21:37A lot of people don't want the phones in the classroom themselves, but also then want the kids to have cell phones so that if there's an emergency, they can get to them. What say you, Joanne? Thanks, Andrew. Good to see you. So I am on the side of keep them in schools, but with some limits. And there's a couple of reasons for that. And there's a lot of research now that's come out behind this. So first of all, as a parent, I've got to say just the safety issue, period. I'm a parent. I would want my kids to be able to reach me in the event of a true emergency. In terms of the academics, however, look, we live in the real world.

22:15We all use our cell phones. These are important tools. And we need to teach our kids to use them responsibly and ethically. And they're going to grow up and they're going to be the people who are going to build on these tools. And it's really important that we don't sort of bury our heads in the sand. And there's a lot of practical uses. I would say limits, right? I'm all totally fine with this idea that their cell phone must be in a pocket, must be zipped. You cannot use it for social reasons. That would be a demerit or whatever detention. But I do think in terms of the classroom, there's practical reasons.

22:56I actually use it at Yale with my own students. If they've got an assignment or I'm showing something that's an illustration, I'm like, take out your phones and take a picture of that. You know, you want to have that there for those kinds of reasons. But there's also studies. I was really fascinated to find there's a study in Singapore that found that if you take phones away from the students, it actually their performance, academic performance declines because of their anxiety. Now, this is not really great for your mental health, but they found that even having the phone in your pocket and not being allowed to use it was actually helping them with their mental health and with their academic performance.

23:37OK, I think Emily's on the other end of this. What do you think? Yeah. So thank you for having me, Andrew. We strongly advocate actually for bell-to-bell policy, which means that phones are turned off and inaccessible to students from the first bell of the day to the last bell of the day. And to Joanne's point, what we find is that if students do have access to their phone, even during a social period, their focus during the class period is on what's happening on the phone. And so we find that students relax into the day more easily, knowing that everyone's phone is put away. With regards to emergencies, I'm a mom.

24:14I have young children. I completely get the emotional response to wanting to be in contact with my child during an emergency. And we know that children are less safe in school if they have a phone during an emergency. Police responders, first responders, they are very clear about this. Students need to be focusing on the adult who is giving them critical instructions for their safety. We need to keep cellular networks clear and open during an emergency so that first responders can be communicating efficiently and quickly. And we don't want inaccurate information spreading during an emergency over text or over social media because it can confuse the process and cause panic.

24:55So while children with phones in their pockets during the day are not safer, they will learn less, they will be more lonely, and they will be more anxious. And when it comes to the education piece, we couldn't agree more. Kids absolutely need more education around digital technology use and risks, but we need to educate without access. So we do this with myriad other things in school. Emily, I want to get back to Joanne, but I just have one question just as a follow-up here. What do you make of Joanne's point about the technology itself, which is that you want this next generation of kids to understand how to use a phone, hopefully responsibly.

25:35I'm not suggesting they can use it responsibly. I think part of the problem is there's an addiction level or element to it that we need to somehow fix. But I imagine in the future, by the way, I know kids, by the way, in middle school who are recording their teachers on the phone. You may say that's good or bad. And then now they're getting that turned into notes for them, which, by the way, may be good or bad, too. But the point is that technology is moving so quickly. And if they don't have access to it, what does that do? Yeah. So we really need kids to develop skills before screens. So there's critical thinking skills that come into play that will enable kids as they get older and their brain develops more to be able to use these tools more effectively.