Holiday Gratitude & Happiness with Arthur Brooks 12/26/25

0:00Bring in show music please. Hi, I'm CNBC producer Katie Kramer. Today on Squawk Pod, the day after Christmas edition. The news is negative because the guys who write it are mad about having to come in. We're here working today on this holiday-shortened week. A year-end happiness check-in with How to Build a Life columnist Arthur Brooks. The government can't bring you happiness. It can't. What it can do is eliminate sources of unhappiness. And what consumers are worried about this holiday season with retail expert Michael Zucor. I think a lot of aspirational luxury buyers have dropped out in the market.

0:41It's harder to justify I saved up for a$3 ,500 purse that this season is$6 ,500 and you didn't improve the value. Plus, our pinch hitters Steve Leesman, Leslie Picker and Contessa Brewer on today's news, like medals on the move and one lucky Powerball player in Arkansas. Lottery is a tax on people who are bad at math. You can't win if you don't play. It is Friday, December 26th. Squawk Pod begins right now.

1:16You're watching Squawk Box on CNBC. I'm Steve Leesman along with Leslie Picker. And now we've been joined by Contessa Brewer, Joe, Becky and Andrew. Well, they're smarter than all three of us. They are off today. Among today's top stories, President Trump says the U.S. launched an airstrike against Islamic State forces in Nigeria, who he said have been targeting and killing Christians. A spokesperson for Nigeria's Ministry of Foreign Affairs said the strikes were carried out as part of an ongoing security cooperation with the United States. Tens of thousands of people, meanwhile, still without power in California following days of rain and flooding.

1:50Malibu is under a flood watch until this afternoon. A powerful storm that hit California yesterday prompted mud flows, evacuation warnings, and high surf advisories. The National Weather Service says the San Francisco Bay Area could see 25-foot waves today. And the New York City area, meanwhile, on the other coast, under a winter storm warning from this afternoon through tomorrow afternoon, with between 5 and 9 inches of snow expected if you're looking to get out of town. FlightAware says nearly 500 flights have been canceled in the U.S. with thousands of delays. And that's the news after the great holiday we all had.

2:27Can we go back and rewrite that stuff and say somebody helped somebody else and somebody did a good deed? And there was a charity thing or something. I mean, somebody smiled. I just think about the lottery winner, the$1.8 billion. The lottery winner,$1.8 billion in Arkansas. What better Christmas gift is there? Yeah, but you know how our guys would write it? They'd say it wasn't me. Well, no, that's what I was getting ready to say, too. I played. You were going to say that, too. Yeah. I played in New York. I played in New Jersey. And I played in Florida. And I didn't win in any of those states.

2:58So, but I went 12 years. Is that a strategy to go across a multi-state lottery strategy? I'm just going to spend$400 on a plane ticket to Florida in hopes that I win the$1.8 billion. It just didn't work out for me this time. If there's anyone who knows anything about betting. That's right. It's Contessa Brewer. And gambling. And gambling. But listen, when you look at this, this is part of what is driving the profits for lottery companies now, like Jackpocket, which is now owned by DraftKings. It's the place where you can go and buy your ticket online, your lottery ticket, in many states. And the big jackpots drive bigger and bigger profits.

3:35Which makes no sense, because you realize lottery is a tax on people who are bad at math. It's also... Statistics. Right? But the thing is, you can't win if you don't play, right? Remember when they used to have that as the slogan on the jackpot? So if you're not playing at all, you're not going to win. But if you play$10, you're probably not going to win. I'm getting phrases in my ear. The dollar in a dream, according to Coutinho, and in it to win it is what he's saying. So he's the other side of this. It's about hope, giving people something to hope. I feel like this is a good Hallmark movie.

4:14It's pathetic. It's pathetic. You know, playing Votto. You're not going to win. You're not going to win. In my Hallmark movie, I am going to win. No, you're not going to win. In my Hallmark movie, I am. I think the news is negative because the guys who write it are mad about having to come in. I think there's a subjective tinge to the news today. Or it could just be that if it's all good news, that's not really news. If everything's working the way it's supposed to, that's not news. I am going to challenge the guys in the back to come up with some. There was a nice piece about a guy, was it the Journal yesterday, who gave away a bunch of money.

4:44$40 million. Yeah, that's a nice piece. That was a great piece. You know, and why aren't more companies doing that? Well, this is like a big effort by KKR, actually. Their head of private equity is really big into employee ownership and giving employees a stake in a company and getting the upside. When you sell it, you get some. Yeah. So you had some good news. Yeah. A little scratch beneath the surface, and there it is. Yeah. We're going to get it out of everybody. That's the challenge today. All right, well, let's see how people who are invested in the market are doing this morning. We'll check on the futures at this hour.

5:19No, not good news. Impiled to open, Laura. Yeah, it was up at a record, at least for the S &P, on Wednesday. Thin trading, of course, this morning. The Dow implied to open down about 100 points. So we'll see if that holds into the open. Treasury is pretty stable this morning in this, again, shortened trading week, limited liquidity. You can see the 10-year is sitting around 4.13. The 30-year, a little higher. Those yields at 4.799. Oil, pretty big story this morning given all the geopolitical news we've seen. But WTI up about 0.2%, down about 16 % over the past year. Gold and precious metals, that has been just the gift that keeps on giving.

6:01Good news if you own that stuff. That has been a glittering trade right there, up 71 % over the past year, up another 0.8 % this morning. Silver up 3.75 % and up 145 % over the last year or so. Let's take a look at Bitcoin, the final four trading days of the year. That's down about 7 % over the last year, up 0.8 % this morning. So, you know, not the best year for Bitcoin, but up a little today. And let's take a look at some of the morning's movers while we're at it. We're starting off with a look at the chip makers. You've got Micron and SanDisk both up about 2 % in the early trade, getting a boost from news over the holiday that Samsung and SK Hynix are reportedly raising the price of their HBM3 e-chip deliveries by 20 % in 2026.

6:56AI chip demand is increasing. And of course, you've got NVIDIA getting approval to sell its H200 chips in China. Micron is up 246 percent this year. SanDisk up 613 percent. I mean, that's a pretty notable mover. Let's get two shares of AST SpaceMobile around 1 percent after successful launch of its Bluebird 6 satellite meant to deliver high speed 4G and 5G space based broadband directly to smartphones. The company plans to launch up to 60 satellites by the end of 2026, and those shares up 276%. Is that a competitor to Starlink? Is that what that's going to be? That's a very interesting question.

7:39You know who would be able to answer that? Let's ask her. And finally, a check on metals here, all moving positive pre-market with gold, silver, and platinum jumping to all-time highs. Investors are really focused on, as Leslie mentioned, the geopolitical tensions, the speculative bets, and the expectations for more Fed rate cuts next year. You've got gold up more than 70 % this year, silver up more than 150%. And this morning, look at copper on a tear 2.5 % higher. Silver Connex is up by 3.5%. Miners like Newmont, First Majestic, Core Mining, and Hecla Mining all moving up along with the precious metals as well.

8:21Time now for today's Aflac trivia question. On this day in 1941, President Franklin D. Roosevelt signed a bill making what holiday fall on an official day? The answer? Thanksgiving. The bill required the holiday to always fall on the fourth Thursday in November. And that is significant because it determines the length of the holiday shopping season. And I can tell you as a person who gathers data on holiday shopping and tries to seasonally adjust it, it is a nightmare. We can talk about that in a minute. So should they have made it like a specific day? Yeah, but President Roosevelt didn't know about Cyber Monday potentially landing on December 1st.

9:03And then my asking perplexity, what is the percentage probability that the four important shopping days, Black Friday through, are in December? And it's 70 % of the time they're in November. Right. And we have been through two years with the 30 % of the time when some or all of those four days have been in December. Which also means fewer shopping days before Christmas. Thank you so much, Contessa. The holiday shopping rush is over for the most part. Consumers will now look to spend their gift card, return unwanted items, and hunt for year-end discounts. Joining us, Michael Zaccor. Did I say that correctly, Michael?

9:36You got it. Thank you. Five new digital founder and author of The New Retail. All right. Can we talk about this calendar thing? Did it matter at all this year, in your opinion? Yeah, it did matter. It jumped out at me immediately in the summer, you know, when I'm planning my holiday rituals and what I'm doing for my own shopping and working with my clients. I said, oh, my God, we're only going to have, I think it was 27 days between Thanksgiving and Christmas. So it was short. But consumers proved to be incredibly resilient, even in a shortened season. You know, people don't ask you, hey, how'd it go?

10:11Who's the winners? Who's the losers? You know, the value retailers have done very well, Walmart, dollar stores. And I think that's because people had less money to spend and they want to spend it in fewer places. And they had a shorter amount of time to do it. What were the things that jumped to the front of the pack here in terms of what people were buying and how they were dealing with this idea of limited budgets? Yeah, electronics were the clear winner. So we think gaming consoles, new phones, new laptops. And that created a mini boom for the retailers and the brands and the technology companies who are inserting their stuff into those devices.

10:53So if you see ChatGPT, downloads are through the roof because they got a new phone. So I think electronics, also apparel, casual apparel, a lot of pajamas, a lot of cargo pants, and a lot of graphic tees. cargo pants it's almost like we've got when now this is pandemic 2.0 where everybody's like living in the comfort gear i'm not supposed to say this but but there was a lot of talk about victoria secrets doing really well didn't they have a report out last week you say that well you know it's sort of um yeah i didn't i didn't see how they see that okay no but i you know if we look at the um the retail stocks who are doing well right now it's reflective of the season so yeah Dollar stores are up.

11:34Walmart's up. The TGX stores are up. It's all that discounted. I had a couple of guests on Worldwide Exchange this morning who were talking about this idea that the K-shaped economy continues in 2026, that the affluent customers are still confident in the economy and spending like the economy is booming and budget minded people are not. What are you seeing? So our research internally showed that over the course of 2025, about 80 % of consumer spending was spent by the top 20 % of earners. So that is a reality. It's the way the season's gone. And again, I think that's why, you know, the discount retailers did really well this year.

12:18Is 2026 going to be then a year for luxury retailers? It could be a year for a comeback for luxury retailers. Luxury had a little bit of a rough 2025. Again, because of inflation globally. I think a lot of aspirational luxury buyers have dropped out of the market. It's harder to justify I saved up for a$3 ,500 purse that this season is$6 ,500, and you didn't improve the value. You didn't tell me I'm getting something more than I did last year. So on the luxury end, we're seeing the ultra-high, high luxury companies, Hermes. The big stuff, they're doing really well, but the aspirational bottom is pretty much falling out.

12:57Like what, Tiffany, LVMH, that kind of level? They're at the highest level. Even within those companies, it's the highest price products, right? The ultra. So the$500 ,000 watch, the quarter million dollar pair of earrings, those are moving really well. That, you know, lowish to mid-level luxury, it's really hurting right now. So it should be a comeback. I'm not sure that we get the best read on the K-shaped economy through Christmas. My theory is that people, they do as much as they possibly can to extend themselves and to buy things for their level. It's after the Christmas season that we might see this come more into focus, the idea that there are these two really different things going on right now in terms of stagnant incomes and some concerns about jobs, and then the affluent who are reaping the gains, I think, of a stock market that's doing very well.

13:49So give us your outlook for 2026. Yeah, I mean, listen, there's going to be a little bit of a holiday hangover, Steve, like you put there. People are going to wake up in the morning and say, oh, my God, look at my credit card bill and my buy now, pay later bills. Overall, though, I think 2026, we're going to see a fairly strong retail economy. Consumers are continuing to spend. They're obviously shifting to essentials and shifting away from, you know, the things that they don't need. They're really focusing on home, right? What are we going to get for clothes, food? The reality is going to be that inflation is still going to be up when we wake up tomorrow morning.

14:25And budgets are still going to be constrained. And that's why I'm still putting my debts, putting my bets on the budget and dollar retailers. When I look at the macro situation with the consumer, I see a sort of bifurcation here. On the one hand, employment is relatively low. The balance sheets are in good shape. On the other hand, and by the way, in addition to that, you have these refunds coming through next year that could be very helpful. And then sort of countering that as a lousy sentiment numbers. Which ones win out? Yeah, I mean, for me, this season, to your point, Steve, it's kind of been a little Dickensian.

15:00But, you know, in the way of it was the best of times, it was the worst of times, right? So we're all feeling really good about spending on the holiday. But then we're going to wake up in January and February. So with the whole affordability and sentiment kind of dynamic that we're seeing in the backdrop here, are retailers responding with deeper discounts and more promotions? Is that kind of the natural reaction or are they just expecting consumers to do the trade down dynamic that you were mentioning earlier? No, this season was highly promotional and very much dependent on discounts to draw people in.

15:34And, you know, that's going to tail off now as we get into the new year. But it was very promotional. And still, you know, what worries me is we haven't seen the inflation adjusted numbers yet. So, yeah, it looks great on paper. You know, the NRF says we went up 4.2 percent. That's true. But we haven't accounted for, you know, the underlying numbers. We didn't talk about tariffs at all, Michael. Was that a factor? It's a huge factor. So we got very lucky this holiday season in that a lot of smart retailers did bring in enough inventory to cover the holiday season so that the tariffs were not a major factor.

16:10They were a factor, but not a major factor. But now we're seeing that inventory has run out. Right. And actually, you know, some of the discount stores like Marshall's, you know, They had great prices and great selection this year because all these retailers brought in so much stock over the summer. Then they had too much. They liquidated it. And that's good for the TJ Maxx shopper. There was a report, I'm looking it up now, that we spent, Americans imported$362 million of Christmas tree lights and paid$18 million in custom duties on that. Over the period of 25,$320 million in custom duties for other aspects.

16:49I mean, there was a big numbers that were paid on some of the just decorating for Christmas was expensive in that regard. Yeah, roughly 98 percent of all Christmas holiday decorations are made in China. So the China tariffs were going to have an effect on the holiday season. We saw it in Halloween as well. You know, I did some retail safari work around Halloween and I was finding, you know, things that were 50, 60, 80 percent more expensive than they were a year before. Now, as we head into January, all of that pre-tariff inventory is gone. So you have a potential to see prices really jump in the first quarter of the coming year.

17:24Michael, thank you very much for joining us. We appreciate that. Cheese will be next. Coming up on Squawk Pod, finding joy in the world this holiday season. Happiness guru Arthur Brooks on giving what really matters. What gives more satisfaction? Throwing dollars out of a helicopter, you know,$100 here,$100 there, or turn the whole dial on one person.

17:53Welcome back to Squawk Pod from CNBC. It's a holiday week, and for many of us, that means more family, more socializing, more giving, and more gratitude. Our Becky Quick and Andrew Ross Sorkin sat down with a Squawk Box guest who's made it his mission to study how those things, gratitude, giving, and family, can make us happier as humans. Our next guest is here with a holiday survival guide. Joining us right now is Harvard professor Arthur Brooks. He hosts Office Hours, that podcast. It's new and it's awesome. Also, of course, a columnist with The Atlantic. But what we want to talk about this morning is money and happiness.

18:31The very idea of can you buy happiness and how we should all feel right now when everyone talks about affordability and how unaffordable things are. Does that make you unhappy? I would imagine it does. How do you think about this? So when we're talking about affordability and inflation, it's not about happiness. It really is about unhappiness. The government can't bring you happiness. It can't. What it can do is eliminate sources of unhappiness, and it can bring you a lot of unhappiness. The number one source of unhappiness that governments typically bring to citizens is not actually maintaining a stable price level because it takes it chips away at the purchasing power of people and they hate it.

19:12It's a tax. It's a tyranny. It's bad policy and everybody knows it. So when politicians say it's not that bad, it just enrages people and quite justifiably. So that's job number one. If you look at the top three reasons why people didn't vote for Kamala Harris, which was really about Joe Biden, it was number one inflation. It was only number two was immigration. Number three was social policy or social issues. So that's the thing to keep in mind. Okay, so how are they doing then on that front? The problem is that it's kind of stuck, and it doesn't actually do good for anybody to say that it's not a problem.

19:47The government means it's hard. It's hard policy because, you know, I was trained as an economist, and I know it's a hard problem. But when it looks like you're actually not paying attention to it, that creates rage, and that's a big problem politically. But for people who are not really troubled by that, people who are above that basic level of just eliminating happiness, a lot of people watching this show, that is actually a pretty interesting science as well. Because it turns out we know how to buy happiness and almost everybody's doing it wrong. Okay, tell me. I want to know. What's the secret?

20:17What are we screwing up? If you have some money. Yeah. Can you buy a modicum of happiness? You can because there's five things that you can do. Nature, Mother Nature, wants you to do one thing, and your impulses tell you to do the one thing that won't buy happiness, which is getting stuff. So people get a little bit above the parapet. They're starting to make a little bit more money. They get a second watch, whatever it is, a nicer car, et cetera, et cetera. And then you get into this hedonic adaptation where it's like more, more, more, more. Keeping up with the Joneses, but even on steroids. Yeah, and stuff won't do it.

20:48Stuff won't do it. We all know that. The new car smell fades. We adapt. That's what we do to stuff. But there's four other things that you can do and they all buy happiness. Okay. Number one is buying experiences with people you love So that's why a vacation with people you love That's why if you're gonna get a beach house not for the house By the beach house as an attraction is a magnet for the people that you love to spend time with them That's why an expensive vacation to Disney for example is really really great and meaningful and wonderful If you're with the people that you love and you're making memories.

21:19That's number one. Okay number two is buying time and And buying time means paying other people to do things so that you have more free time to cut your yard, to clean your house, whatever it happens to be. But you've got to spend your time doing something personally, edifying, or with people that you love. Scrolling social media doesn't count. Watching TV doesn't count. Don't waste the time that you're buying. Be super proposive about it. That will buy happiness. Okay. But by the way, there are some people I know that actually love to garden. Yeah, for sure. Yeah, so you need to spend your time because that's actually very productive leisure.

21:50Okay. If you're doing something that creates value that you love, you should absolutely do that. Some people who do gardening do it by themselves. Yeah. No, no, that's edifying. That's like praying for them. That's a meditative activity. You could run, you could do meditation, you could do anything, any activity. For sure. I'm waiting for number three. I'm assuming one of these is going to be to give away money. Yeah, yeah, that's number three. Number three is giving your money away. But you have to give it to things that you love. A lot of people who are very rich, they don't like philanthropy because they don't have very much interest in the things that they're expected to give money to.

22:18You live in Omaha, and you have to join the board of the Omaha something hospital, because that's what, to be a member, a functioning member of a society. Interesting you use Omaha, because all the things you're talking about are things that I think Warren Buffett figured out. Yeah, that's right. He lives a modest life, doesn't spend all his money. And he gave his money to Bill Gates, because Bill Gates is super good at philanthropy. And he's like, I'm not good at this. I'm good at investing. If philanthropy is not my thing, I'm going to give it to the expert in philanthropy. And that gave him more joy.

22:47You got to find something you're really, really passionate about. My wife and I, Esther and I, are very passionate about Catholic education. Catholic education. We give almost all of our philanthropy, which is 10 % of our money. Okay. You tithe. We tithe. I asked my dad that, by the way. Very religious guy. Are you supposed to tithe 10 % before or after taxes? That's how I asked my dad, because my dad was always a serious tithe. I said, Dad, he has a PhD in biostat. So he was a very sophisticated guy. He said, do you tithe before or after taxes? And he said, before. I said, what? I'm an economist.

23:18After dad, why? And he said, just in case. Just in case. Because God's watching. I have one of the related giving questions. So you give to Catholic charities. I give to, yeah. Do you feel bad when people come to you and ask you for money that are outside of the charities that you care most about? Do you give a little bit just to sort of be in that community or not or whatever it is? Depends on the person. Or do you say, I know some people who are very good about saying no. And they say, I'm all in on this one thing. And that's what our family does. We don't do anything else. And they feel very good about sort of having these walls.

24:00And then I know other people who have something that they care about. But then they end up getting called by 12 other friends and this and that. And the people in their community. And they feel that they have to give. But I don't think those people love giving in those contexts. So I will give to things that I'm not super passionate about to actually pal up with people I love. People I really care about. So to pal up. Yeah. That's a really important thing. But is that like my friendship? No, it isn't. My wife and I had that conversation once. No, for sure. But you got to, when you're collaborating with people that you trust and like.