Fed Decision Day, A UK Visit, & House Speaker Mike Johnson 9/17/25

0:00Bring in show music, please. Hi, I'm CNBC producer Katie Kramer. Today on Squawk Pod. China banning tech companies from buying NVIDIA chips. Speaker of the House Mike Johnson on the political implications. We're in a race with them. It's a very, I think, counterproductive development for what they've announced about NVIDIA. And we've got to work through that. And it's Fed Day, the interest rate decision we've been waiting for. I think we need rates to come down today. I think that's obvious. It would help homeownership for young families, and it would allow them to start new families. President Trump's state visit to the United Kingdom is underway.

0:40We'll hear from Richard Haass, President Emeritus of the Council on Foreign Relations. No ally anymore is a special relationship. That's the bottom line. The era under this president where allies were treated special in a positive sense, I think that's over. Plus, the TikTok deal in the wings, and StubHub comes to Wall Street, but not everyone likes to go out. I'm not going to wait three hours. I'm either going to eat there or I'm not going to eat there. It's Wednesday, September 17th, 2025. Squawk Pod begins right now. Stand Becky by in three, two, one. Cue it, please. Good morning, everybody.

1:21Welcome to Squawk Box right here on CNBC. We're live from the NASDAQ market site in Times Square. I'm Becky Quick along with Joe Kernan. Andrew's off today. Good morning. Morning. No, I'm channeling something. I'm not sure. I'm not sure. What do you think? I like it. I do like it. But is it that it's youthful, right? No, no. Are you saying I'm too old to wear this? No, I'm not. I'm just saying it reminds me. I went to Catholic school. Oh, so did I. I graduated from Catholic high school. Yeah. Does it remind you of the youthful? school not exactly but uh it's fresh and and new and i haven't seen it before so i mean we're stuck it's uniforms yeah yeah don't go there all right uh-huh this just got a little weird no oh oh boy all right we'll see what the fed has to say most people are anticipating a 25 basis point cut but there could be some interesting language that details whether the next meetings are live or not and we'll kind of see what happens along the way.

2:22And if you go back, I don't know, everything is a continuation of something, but if you go back to when President Trump first started arguing for lower rates, we've been talking about whether the Fed will ever cut for a year? Yeah, this is the most important Fed meeting of the year. It's the beginning of an easing, it could be the beginning of an easing cycle. That's what's anticipated, right. And you don't want to turn it. So I'm wondering how, or whether or even care, He probably does care. I wonder how Jay Powell decides to, you know, let's say he does a quarter point, and then after that comes all the conjecture about what's next.

3:00And that's why he's going to, you know, remember. He's going to have to hint towards that. They do. But one word in the past can make a difference. I mean, Roger Ferguson was with us this week, the former vice chair of the Fed, who has been pretty accurate about describing the thinking of the Fed, at least on a lot of these issues. And he said he anticipates that the next two meetings this year, the last two meetings this year, will be live meetings. So whatever happens, his expectation was for a 25-point cut this time, a 25-basis-point cut. He anticipated that you would see dissents both on those who wanted to do nothing this time around and those who wanted to cut 50 basis points.

3:37And he said the last two meetings he thinks will be live, which sounds like a fairly safe assumption. I'm trying to remember. Leisman would know those words that were either included in the future guidance or left out for an extended period. I think that's been in before. And people take, you know, I don't. Yeah. You never know. But they think very. I'm sure he's like racks his brains. I can't remember. What was the transitory? That was the word. Transitory was in for a while. Maybe. I mean, to put the statement together, I, you know, at this point, AI, that's what I would use. OK, I'm looking at cutting a quarter point.

4:15I want to say I'm going to continue to look, you know, just ask the question. I'm going to put that into perplexity. Put it into perplexity. What do you say? I'm continuing to be vigilant about inflation, but there is some weakness in the labor markets, perhaps. What do I say? You really going to do that? Yeah, it's a good take. I'm continuing to be vigilant about inflation. Yeah. But I'm worried about the labor market. I want to calm the markets that I'm not, you know, in a with the stock market at all. you know, I'm saying it for him. With the stock market at all time highs, how do I explain that we're cutting?

4:46I don't want to spook the equities market. Good. How do I say it? You're using perplexity. Yeah. How do I say it? In the meantime, I'll talk about a little bit about NVIDIA and what I was saying, because, you know, we've been saying that the shares are down. They're off a little bit. What is it? One percent this morning, the Financial Times reporting that China's less than a percent. China's Internet regulator told the country's tech giants, including ByteDance and Alibaba, to stop buying all AI chips from NVIDIA and to cancel existing orders. That includes a new chip custom made for China. One Chinese tech executive telling the FT that previously companies had hoped for a refreshed supply of NVIDIA chips.

5:27But now it's all hands on deck to build the domestic system. CNBC has reached out to NVIDIA for comment. This sounds like what we were talking about yesterday. yesterday, if China is going to give in on TikTok and, you know, whether these trade talks continue, they've sort of are taking a stand and using the dealings with NVIDIA as a bargaining chip. But, you know, that stock was$82 in the last 12 months. The high is$184, I think. So it's down a little bit. This doesn't look like too much trouble so far. Is it good? It is. This is really good. And it took three seconds. Wait a minute. What if he says this exactly and you out?

6:04This This says, I am the chairman of the Federal Reserve. I'm continuing to be vigilant about inflation, but I'm worried about the labor market, and I don't want to spook the equities market. How do I write up an FOMC statement reflecting that? This says, recent indicators suggest that economic activity has moderated somewhat following a period of solid expansion. The labor market, while remaining strong by historical standards, has exhibited signs of softening, and the committee remains attentive to risks of further cooling. Inflation remains above the committee's longer-run objective of 2%, and the committee remains highly vigilant regarding upside inflation risks.

6:39The committee seeks to achieve maximum employment inflation at the rate of 2 % over the longer run. Uncertainty about the economic outlook remains elevated, and the committee is attentive to the balance of risks to both sides of its dual mandate. Against this backdrop, the committee decided to maintain the target range for the federal funds rate. In considering future adjustments to the stance of monetary policy, the committee will carefully assess the implications of incoming data for the economic outlook, including readings on labor market conditions, inflation pressures, and financial and international developments.

7:09It goes on to say more. I mean, you could, okay, when it's all said and done today, you could put that against the real one. And if you didn't know, you'd have a real hard time deciding who was really Jay Powell and who was... Perplexity or whatever AI agent you use. That's unbelievable that it wrote that that quickly. I know. It is. And that's why I don't know. You know, the lights just dimmed in some little city next to the data center that had to figure that out. That takes so much power. But what a world that we're living in. We are all you don't need to know. We don't even need to read this.

7:45I will anyway. The Fed will announce its decision on interest rates at 2 p.m. Eastern time today. You probably know that most of Wall Street expecting that quarter percentage point rate cut. That was the first that would be the first since last December. Fed officials will also sketch out what they see ahead with revised economic projections for that dot plot. Fed Chair Jay Powell will speak to the media at 2.30 Eastern time. That's what's going to be important. A lot of people gauging what comes next already. One new Fed governor is participating in this week's this week's meeting. That would be President Trump's appointees, Stephen Mirren.

8:21The Senate confirmed him on Monday. Some expect him to dissent from a 25 basis point rate cut if that is what the committee actually decides to do in favor of a larger move. Fed Governor Lisa Cook also still on the central bank board after an appeals court declined to let President Trump fire her. And I guess the question is, would she go along with the 25 basis point cut? Would she say, forget it? I don't want to cut anything. I'm mad at this point. She might go for a cut if she's got a floating rate mortgage on some of those primary residences. that she says three or four that. Sorry, I set you up for that.

8:57You did. Just kidding. Just kidding. Everybody needs their day in court. U.S. tech giants planning to invest more than$40 billion in AI projects in Great Britain. That includes$30 billion from Microsoft over the next three years. The company says that the money will allow it to build the U.K.'s largest supercomputer in partnership with a leading British cloud computing firm. NVIDIA, Google, OpenAI, and Salesforce also announcing plans for multi-billion dollar investments in Great Britain. At the same time, London-based GSK said it will invest$30 billion in research and development and supply chain infrastructure in America over the next five years.

9:42This is nice, all of us getting along so well together. All this news comes as President Trump visits Great Britain. He touched down in the country yesterday. Today, he's set to be greeted at Windsor Castle by King Charles. The CEOs of NVIDIA, OpenAI, and Microsoft, as well as BlackRock's Larry Fink and Blackstone's Steve Schwartzman, are also expected to meet with President Trump while he is overseas. They're like, do we invite Blackstone or BlackRock? Just invited both. I guess is the way it works. It's confusing. That doesn't surprise me that both of them would get an invitation. It surprises me a little.

10:23Oh, it doesn't? For Fink, it does a little. He's no fan. Well, he probably is now. You know, as the wind's blowing. President Trump extending the deadline for ByteDance to divest from TikTok's U.S. business. This is the fourth time that the president has made that move. Reports say a deal under consideration would see a new U.S. version of TikTok with Oracle, venture capital firm Andreessen Horowitz, private equity firm Silver Lake and potentially other U.S. investors owning 80 percent. Chinese investors would own the rest. The Wall Street Journal is reporting that the board of the new entity would be made up of mainly Americans with one member chosen by the U.S.

11:04government. President Trump is expected to talk with Chinese President Xi about that arrangement on Friday. In a statement, a senior White House official said, any details of the TikTok framework are pure speculation unless they are announced by this administration. Obviously, a lot of details that still need to be worked out, but there are some big questions about how this would work from a technical perspective. To this point, the Chinese government has been very opposed to the idea of allowing anybody really to see its algorithm, them to get a hold of that. It's been a big black box. And I guess the question is, if American engineers are licensing that, will they be allowed to understand how it works?

11:44Or are they going to be given that black box and told, okay, you can play around the outside and not get into the inside? And I think those are the technical questions that have to be answered to figure out if this is something that would assuage the concerns that are in that U.S. law that was passed by Congress and then signed by President Biden. If you do need to be in good stead with the current administration to do things, those are three companies or three entities that I might pick that get along pretty... They have supported President Trump. Yes. I don't know about Silver Lake. Andreessen Horowitz for sure.

12:21And Oracle. Online ticket platform. StubHub. I think it's just like scalpers almost, but I've used them. priced its IPO at$23.50 per share. That's at the midpoint of the expected range. It's all legal. They're not scalpers. They're just a place they allow scalpers to post their tickets. I've used them on both to sell. I've used them both to sell and buy tickets. You can go if you want to go. If you're willing to pay an up-right. If you're willing to pay. I have argued in the past that there's certain restaurants where it's bothered me. Down in Florida, it's a three-hour wait if we happen to be at this one place.

12:56And it's like, I'm willing to pay. I know that's horrible. It's not egalitarian, and it's entitled, and everything else. But either I'm not going to wait. No, I don't say do you know who I am, because they don't. But I'm not going to wait three hours. I'm either going to eat there, or I'm not going to eat there. And I'll eat there if, you know, what about a tip? Give a big tip. I'll promise a big tip. A tip to the maitre d'. How about a tip to the maitre d'. Is that okay? Okay, you're just going to keep shaking your head, calling me entitled. all the fun of it. Well, I know. You set yourself up for that, too.

13:30But I know. I used to like when Disney World wouldn't let you buy your way to the front car. Why do rich people get cars when no one else can get a car? What do you mean? Uber. Oh, yeah. When they pay for Uber Elite. Why do rich people get to go and get good seats at the US Open? It's true. So what's the difference between that and? You're right. It's just you want to be one of those people. I'm a wannabe. I am. The company gave last week. Yes, I will admit I have paid for. I have definitely. Too much for tickets. And it's unbelievable what you do pay. Like a Taylor Swift or something? I had to pay for...

14:03You're taking your kids to something you end up paying. My Chemical Romance. I paid for Cocomelon. I had to pay for My Chemical Romance. Second price or second place was I pay more for... Three more hours on Twitter. Yeah, exactly. No. The second price was two My Chemical Romance concerts. Giving StubHub a valuation of $8.6 billion. Shares are expected to begin trading today on the New York Stock Exchange under the ticker symbol STUB. I don't know where they got them. Cheese will be next. Coming up on Squawk Pod, President Trump has headed across the pond for his second state visit to the United Kingdom, and global tech leaders have joined him for the trip, promising to be busy with deals and potential economic promises.

14:48Richard Haas from the Council on Foreign Relations is our guest. This administration's willingness, how would I put it, to put economics first, and geopolitical concerns might be traded off in order to get what the administration wants, say, to reduce the trade imbalance. So there's a little bit of nervousness out there, less on the economic side, more on the geopolitical side.

15:14This is Squawk Pod, today with Joe Kernan and Becky Quick. Straight up on Becky. Three, two, one, up on Becky Q. All right, welcome back, everybody. Two China-focused business headlines we're following this morning. One, the Financial Times reporting that Chinese internet authorities have told the country's tech giants to stop buying all NVIDIA AI chips. And second, reports say that there is a deal under consideration that would see a new U.S. version of TikTok created with Oracle, venture capital firm Andreessen Horowitz, private equity firm Silver Lake and other U.S. investors owning 80 percent.

15:50Joining us right now on this and on President Trump's U.K. state visit is Richard Haas. He is president emeritus of the Council on Foreign Relations and a senior counselor with Centerview Partners. And Richard, thanks for coming in today. Good to be with you. All right. We've got a lot of things to talk about around the globe, but let's start with what we're hearing out of China right now. The story in the FT has NVIDIA shares. I think they're down by about$3 on the implied open on this. And it comes out that the Chinese authorities are saying, don't buy NVIDIA chips. We want you to buy homemade ones instead.

16:26On the surface, it might look like classic import substitution. Chinese want to be protectionist. On the other hand, they don't really have the near-term alternative. Look, we're what is it, Mid-September, six weeks away from some type of a meeting between President Trump and President Xi Jinping, whether there's actually a summit is still being negotiated between the two sides. I assume this is part of the skirmishing, the run-up, the setting of the table for a much larger U.S.-Chinese conversation. Just putting everything out there, dumping everything, like kitchen-sinking it, basically. And it's a reminder that, like with rare earths and other things, China has, shall we say, a lot of pushback to play the game.

17:02And that's what Treasury Secretary Besant told us yesterday. There was this very big aggressive ask, and now all of this is kind of getting wrapped into it. TikTok is part of that, too. We don't know the terms yet. I'm not sure that anyone does. There's a call that's coming up on Friday between President Trump and President Xi. But I think the big question is still a technical one. Who controls the algorithm? If U.S. engineers are licensing it, will they know, or will it still be a black box that they're licensing? Exactly. There's all the talk about the so-called secret sauce and all that. I don't know the answer to that.

17:35You know, that's that's Chinese so far played very hard to get on that. But without that, I'm not quite sure what the deal actually consists of. What do you think overall of the push for an economic deal with with China while you still have national security kind of in the background? Obviously, this is something that every administration has had to balance for quite a while. Yeah, this administration has kind of been all over the place. On one hand, very tough on tariffs. On the other hand, the export controls were relieved on certain chips. You have the tick tock effort. So it's a little bit hard to read.

18:07There's a little bit of concern out there. I'll be honest, Becky, about this administration's willingness. How would I put it to put economics first and geopolitical concerns might be traded off in order to get what the administration wants, say, to reduce the trade imbalance. So there's a little bit of nervousness out there, less on the economic side, more on the geopolitical side, given the priorities of this administration are so often economic rather than geopolitical. How does that play out geopolitically? Because there has been a doctrine going all the way back to George W. Bush. If you lead with economics, that that would bring democracy and other things along the way.

18:38Those days are over. The hopes that China would become more democratic, more market oriented and more moderate in its foreign policy. The whole argument for engagement and integration. That's over. That was over. The first Trump administration was the first nail in that coffin. The Biden administration was the second nail in that coffin. So that's over. I think the real question now is what is this administration going to signal about the South China Sea, more important about Taiwan, and how will that trade off potentially with economic issues? We've been so clear. We even have a policy called strategic ambiguity.

19:11The actual policy is called that. We have no idea what the ground rules are for dealing with China right now. And, you know, he is a businessman, so I can see the way it comes down. And does that eventually come back? Do chickens come home to roost when everything's based on money and economics? I don't know. It's hard to make any progress if you just focus on global security. They don't, like Kyle Bass, other China hawks, they're not going to do what we want anyway. I don't know. I mean, we have to live with them and trade with them, do we not? Absolutely. So you've got two big buckets, if you will, of the relationship, the strategic and the economic.

19:51One question is whether you keep them separate. The other is whether you have trade-offs between the two. I think it's inevitable, whether it's formal or not, that there's a degree of trade-off. That's when you get up in the morning. And by the way, China is pretty insistent on that, too. They're not going to do it. They're having a bit of a conversation themselves. I had a meeting the other day with a senior Chinese official. And for the first time, he said to me, we want to keep them separate. Really? Yes. I mean, that's a huge shift for them. You could liken it to do we sell China components to build weapons or nuclear weapons.

20:23AI is probably more of a threat. And if you had leadership in AI, it's worse than leadership in nuclear weapons. So now we've got it. All bets are off with AI. Do we really want to help them lead the world in AI? They're doing my hunch is they're going to do just fine. Either way. Without our help. Will we slow them down? I don't think a whole lot. Given the massive investment and the amount of engineers and talent they've got there, my guess is they're going to do just fine. I also think, though, there's probably zero chance you could get meaningful, what, AI arms control between the United States and China.

20:55We're competing for it to exploit it economically as well as militarily. That's an argument for not having any export controls on any of these chips. Well, in some ways, the direction the Trump administration has gone is be less restrictive. You can't really slow the Chinese down. rather have our stuff more available so the world participates in a U.S.-led AI ecosystem. That's one of the conversations. So the end of the world clock is like nine seconds from midnight now. Richard, is it going to be nuclear? You probably think it's going to be climate change or nuclear, climate change or AI. What's going to do us in?

21:29Hopefully none of the above. I'm voting for D. How about all the above? Come on, it's lighting up, John. No, AI is scary. We should throw in another Wuhan biotech. Chemical, biological, nuclear. Or you use AI to design a virus that kills. It could be. But AI is so interesting because there's such an upside. It's like most technologies. How do you basically take advantage of the upside and find ways to push back against the downside? Easier to articulate than actually to do. And that's the real challenge with AI. We're out of time, but let's touch very quickly on what's happening in the UK today.

22:07The president is there. A lot of business leaders are there, some of them talking about some major investments in the UK. Is this a special relationship still? No. The UK reduced its significance with Brexit. Its economy has essentially flatlined. So, no, it's not really a special relationship. The purpose of this trip is kind of a feel-good trip. But the United States and this British government disagree profoundly on the Middle East, disagree profoundly on Russia and Ukraine. Brits are unhappy with tariffs. The steel talks just fell apart. So no, this is no ally anymore. It's a special relationship.

22:41That's the bottom line. The era under this president where allies are treated special in a positive sense, I think that's over. And increasingly, this is a much more every boat on its own bottom. If you will, America first, not allies first. That's in some ways the most basic difference between the Biden and Trump foreign policy is now the lack of specialness afforded to allies. Except for Israel. There have been strangely passive with both Russia and Israel. No, but they're obviously still allies. Yeah, but that's the case where... In the Biden administration. And that's the case where we would actually, I would argue Israel and the United States would both be better off if we took a more critical attitude to Israel.

23:22But essentially an unconditional green light I don't think is in anybody's interest. But you don't want to arrest Netanyahu. Have you endorsed Mondani yet? That's coming. I'll wait for that. Get comfortable waiting. Richard, thank you. Next on Squawk Pod, House Speaker Mike Johnson joins us on the legislative priorities as his majority races to avoid a government shutdown and hammer out trade priorities in the Trump administration. China has been working for a long time now to become a peer-to-peer adversary with the United States. And we're in a race with them, frankly, in so many areas, in AI and the advancement of new technology.

24:02And China is not a fair trading partner. We'll be right back.