The russell 2000 down 11 with the small caps since the watermark on july 31st. It has people wondering with the small caps and industrials down, is that a worse sign to come . Germany is in recession. China is slow there. Maybe we shouldnt be surprised. The fascinating thing is people are writing articles that we could be in the First Quarter of the slowdown. Not negative, but a slowdown. It would be one of the things where it happened gradually and all at once. The indicators are not saying that. Correct. We are hearing more and more people and it is depressing with the former fed guys, the smart ones we had on. Daniel. That narrows it down. Saying the biggest problem the fed has is they dont have a crystal ball. We know that. We need to remember that. If you are looking at three months or six months ago and making policy decisions, they will not be at that rate. I dont know what is better. Maybe some rules based regardless of what your gut is feeling. Sometimes that doesnt always work based on what has happened in the past. The good news is the fed is stopping to look around to figure this out. If you want to look at treasury yields, we did see an uptick in yields last week after the fed decision where it will stop and look around. You will anticipate rates will be higher for longer. The 10year treasury this morning is 4. 495 . The 2year treasury is at 5. 13 . You have talked about yields which have picked up significantly. Crude Oil Prices Last week dip below 9 9 90. If you went to bed early last night, raise your hand. Not it. Huh . Not it. You didnt go to bed early . Earlyish. The steelers won. I dont think you can say the steelers are horrible. You know what i mean . In my memory . No. They won. Also, you may have missed hollywood writers and studios have reached a deal to end the strike. Matt belloni from puck joins us now. Matt, we have a lot to talk about. This supposedly was the year of the bears did a little bit better. The reason im bringing that up is because travis kelce has a new squeeze, apparently. I dont know if you saw that. Taylor. I did. You did. I get nervous when someone is watching me do things. He did not get nervous. There she is. He is a university of cincinnati grad, travis kelce. Taylor was there. Im not getting anything from this movie opening. I dont know why. I did have something to do with it. Will it do 100 million . Well, now, for sure a cynical person might question whether taylor swifts appearance at the game is related to the fact she has a movie coming out in three weeks and might want to get some of the football fans to see it. Not a bad time to have a movie given that there has been some damage from this strike. Some things have been put off. If it ends now, you can salvage something for next summer and 20232024 tv season. This will work if it happens. I thought you were talking about the kelce movie out. Is there . 100 commercials. Travis is in every commercial that comes on. Sorry. This is the taylor swift movie were talking about. She is interesting because she could promote her movie potentially if she wanted. Thats a big thing in the sagaftra strike. They are not allowed to promote. Last night, the writers and studios came to tentative agreement to end the 146day strike we have been talking about all summer. What do you know . Neither side are allowed to divulge details. We can assume the studios conceded to some of these things . Absolutely. There was compromise on both sides. From what im told, the writers are getting a success metric in streaming which was a big point of contention. They wanted to see data and how well their shows are doing. They wanted some of the residuals to be given as a bons if their shows did well. Im told they did get that metric. They got concessions on a. I. The studios gave them broad protections against a. I. Work for training. The studios did get the ability to experiment a little bit and reframe the positions in the next round in three years. They got wage increases and the normal things you would expect. What did they give . What did they have to givstr . They wanted a minimum number of writers on each show. They did not get what they wanted. They did get something. It is based on the number of episodes per show. They didnt get that. They wanted broader transparency where they get access to all sorts of data that they will probably not going to get. There are other issues with wages. They wanted the ability to strike if other guilds are on strike and they are not getting that. It is definitely more than what they were offered on may 1st which is when we went on strike. Why have i read in a couple of places that this opens the door for a settlement for the actors . Why . The thinking is the actors will use a number of the terms from the writers deal as a template and build upon that. The writers have issues which are specific. The actors have issues specific to actors. The thinking is that now the writers are done which was the big hurdle, then the actors will follow a couple weeks after. I made the point that maybe things can be salvaged. It takes two months before you start production of a tv show. I believe that. They are well written. Even the crappy ones are well written. What is delayed . How much damage do we see on the studios at this point . It takes a couple weeks to ratify the deal. If the tentative deal becomes the real deal, then they have to ratify it and vote and the actors have their separate deal. Bestcase scenario if the actors do the deal we think, we think around thanksgiving we could get back up to production. Everything will go all at once. All right. What does this mean for the uaw, matt, and the Government Shutdown . That i cant tell you. The general sentiment in the country is leaning toward labor. You are giving me a serious answer. I think the Government Shutdown is like the 12 republicans going on strike because of the 33 trillion. It is like that. We are in you definitely have seen a sea change. We will see if it is an Inflection Point or not. There are righttowork states, matt. You can drive people and companies to righttowork states. You have to think carefully about what wyou do. Did you see the eras tour live . I did. I went in los angeles when taylor swift was in l. A. Ill probably see the movie. Im not rushing out. I told my wife ill get tickets p a and go. She has some talent. You have come around to that view . You are just now realizing this . Wow she has written like 100 songs. More than that. Unbelievable. All right. Very good. Thank you, matt. My wife is happy about travis kelce. She is finally getting away from the other types. You know, the Jake Gyllenhaal and harry styles. She is getting away from the singers and entertainers. Theyre flakey, arent they . And athletes are better . Maybe. Maybe. I dont know. Well see. I dont know what the half life of this one is going to be. I would not venture a guess. In my family, they think he is cute and nice. All right. I think youre cute and nice, matt. I appreciate that. You are supposed to say same. Of course. He didnt even think of that. See you later. Maybe we should go to the taylor swift movie together . Im not opposed to that. I have plenty of stuff. Are you a large or extra large . I have so much taylor stuff we can wear. Im an xl. You like hoodies . Sure. I got hoodies. I have all that stuff. I got connections. You got a bracelet for me . A friendship bracelet . I had one. I wore one. I dont want to talk about that. I wore one to the last concert. One of her songs. One of her fricking songs. Red. I like that song. See you later. Tmi. Before we head to break, we want to update on the auto strike. Ford says despite progress in areas, it still has what it is calling significant gaps to close on key issues before it can Reach Agreement with the uaw. The remarks coming after the uaw actually expanded strikes at additional gm and stellantis facilities on friday. Saying they were making progress with ford. Thats why they were holding off on extending strikes there. In the meantime, ford securing a win with Canadian Auto workers. The union voting to ratify the agreement which avoided that strike north of the border. Ford is off 12 cents. When we come back, amazon making a major deal with a. I. And dont miss chicago fed president dpAustan Goolsbee. He will join us live at 8 30 a. M. Eastern time. A lot to talk about with the chicago fed president. You are watching squawk box and this is cnbc. when the day that lies ahead of me seems impossible to face a lovely day lovely day lovely day lovely day a bank that knows your business grows your business. Bmo. Rich, velvety. Coffee. Cafequality. Espresso. One highpressure system. That can do both. Brew to your hearts desire. With the lor barista system. Now brewing peets coffee. Welcome back. New overnight, amazon will invest up to 4 billion in a. I. Company anthropic and take minority ownership position. Anthropic will use the custom chips to build and deploy the a. I. Software. A a anthropic offers an a. I. Assistant that competes with chatgpt. It was founded two years ago by former research investors. It attracted google and salesforce and valued after a funding round in may. Amazon shares up by 1 on the news. Meta platforms is planning to release a. I. Chatbots to attract young users. It says the new a. I. Bots could be revealed this week at the connect conference. That is on wednesday right before the delivering alpha conference on thursday. I might point that out. If you havent signed up, you could do so at cnbcevents. They are tested by employees and they are meant to be used to drive engagement. Some may have Productivity Skills to help with coding. Im not really that good at it. Im average. How about you . Relative to . Someone that knows absolutely nothing about coding. I used to like it for High Performance pascale. I can do html. That is like monkey code. I can code a web site. I know those letters. Not fancy. The futures are flat this morning after a losing week on wall street. Joining us to talk about that and what to expect is cameron dawson. She is the chief Investment Officer at newage wealth. Cameron, what have we seen with the down market at this point . Last week, we broke the 4,300 level which was the august low. That was an important level to hold. Now that we broke that, it puts the 200moving day average in sight for the s p. That is only 9 from peak to trough. The peak from late july to the 200day average. That is average for a correction. It is bigger for the nasdaq. The nasdaq was more overbought and expensive. It is about 18 down to its 200day moving average which is bruising, but given the fact it was up do youble up s p, we are still having the decline. You see the nasdaq is 21 . Nasdaq is up sharply. What does this tell you about where we stand as we get into october . I think the thing thats really different about this correction is it hasnt been growth related. This is not about growth fears. You see that with credit spreads which remain contained. You see that with the leadership in the market. You havent soon a big braeakdon in the consumer staples. That tells you that you are in the shallow category. If you see growth pick up, that could mean the period of higher eps and higher gdp estimates would rollover. That is where you would have a deeper correction. You have to watch that closely. Small caps and industrials have been under pressure. That concerns people. Small caps have sat out the rally since the october low. That is very different for major market lows. If you look back in 2009 and 2020, small caps led with fed support and improving economy. Small caps have done nothing this year and have been a weak point. That speaks to a lack of Risk Appetite in the market. When investors are clamoring for risk, they pile into ipo. The good news is it is earnings season. Maybe it is good news or not if you are looking for a catalyst or something to trade on. Because you have better economic growth, it sets you up for upside surprise to earnings. Thats what we got in the First Quarter and what we got in the second quarter. It will really depend on Investors Sentiment and how the upside surprises can continue. 2024 estimates are up 12 growth for next year. That is a fairly high bar. Mostly if you think that if you avoided recession in 2023, does that increase the probability of increased recession in 2024 . That is the pushpull. Cameron, thank you for coming in. Thank you. Coming up, tinder rolling out the vip subscription tier. Interesting. I wonder if i can do vip. No, you cant. Ask penelope. The ultra Premium Service will cost 500 a month. Details are next. Later, countdown to veme stdn. Gornnthuow we will talk to representative Brendan Boyle. You are watching squawk box. Er trading to help sharpen your skills, you can stay on top of the market from wherever you are. E trade from morgan stanley. Power e trades easytouse tools make complex trading less complicated. Custom scans help you find new trading opportunities, while an earnings tool helps you plan your trades and stay on top of the market. E trade from morgan stanley. When you automate sales tax with avalara, you dont have to worry about things like changing tax rates or filing returns. Avalarahhh ahhh tinder has rolled out an ultra premium tier charging 499 a month for exclusive search and matching. This whole thing were going to do this without comment. We were commenting during break. I dont know what it means. It means that people on it i have an idea. This is legal. You put your bank account on who you are . If this means you are somebody who is up for going out every night and hooking up. And show a good bank account, you will find someone . How is this different . Thats what i dont understand it. Without comment. You swipe. Ive never been on tinder. The plan called tinder select launched friday. It was offered to less than 1 of users who are among the apps most active. Were out every night. Looking. Jonesing for a date. The company said users a date. Tinder might be mad at us. K new features with search matching and what is not provided in the existing payment plans. It is not clear what you are getting for 500 a month. The Parent Company match group has experience with highprice dating subscriptions. High price what . Dating subscriptions. It bought the league in 2022 which targets careeroriented singles with a vip plan that costs 1,000 a week. That was supposed to be a 20second read. Just saying. I almost i know. I almost started with im going to read this without commentary and you ruined it. I know. Youre right. These are all things that people are thinking, but usually not saying. Right. When we come back, reports say there was little progress in washington over the weekend with less than a week to go before the saturday shutdown deadline. We will dig into that orsty next. Squawk box will be right back. Announcer executive edge is sponsored by at t business. Next level moments need the next level network. Move to the cloud. So, the question is. Cyber attack as cyber criminals expand their toolkit, we must expand as well. We need to rethink. Next level moments, need the next level network. [speaker continues in the background] the network with 24 7 builtin security. Chip . At t business. [soldier] take a look at this theyve left us a gift. [soldier] i think we misjudged them. I love horses. birds chirping [soldier] we should open the gate. Lets see what charlotte thinks. [narrator] at crowdstrike, we monitor trillions of cyber events to detect threats and prevent breaches before they happen to keep your business from becoming history. We stop cyberattacks. We stop breaches. We stop a lot of bad things from happening. Crowdstrike. Protection that powers you. Good morning. Welcome back to squawk box. We are live from the Nasdaq Market site in times square. We had green arrows across the board for a second. Right now, everything is flat. Dow futures up 5. S p futures up fractionally. Nasdaq futures down. A programming note. Dont miss our interview with Austan Goolsbee at 8 30 a. M. Eastern time. We will hear about what he thinks about the economy and if the fed will hold rates higher for longer. Voting member. Yeah. He has been thoughtful of the continuation into higher rates. I dont want to speak for him. He can give us the latest on how he feels at 8 30. Exactly what he is willing to share. Exactly. Congress is back on the hill tomorrow to continue working on agreement to avoid a Government Shutdown following the disastrous week with no deal. Joining us now is heidi heitkamp. She is the director of the university of Chicago Institute of politics and cnbc contributor. She fits in chicago very well. Can you tell the difference, heidi . Phil lebeau. Can you tell the difference with chicago and fargo accents . Barely. Barely tell the difference. Mick mulvaney served as white house chief of staff under President Trump. Ill read both of you a comment from the speaker and i dont know whether we can count on this or not or if this is different this time around where they dont shut it down. He says when it gets to crunch time, people have been holding off all this time blaming everybody else will finally, hopefully move. Do you talk to any of these people any more, mick . Are the real dead enders matt gaetz will never move . I think kevin is right. That is how it played out in the last couple shutdowns. I do think it is different time not because the people are different. Keep in mind, it is an interesting term. Dead end. They have not seen how this plays out because they havent been there long. That combined with the narrow margin. Kevin had a marin of 15 to 20 votes, we would not have this margin. He all of these things make this different. I think they go into a little bit of a shutdown. If nothing else, to teach the new folks the lessons of how awful it is for conservatives when this happens. Right. Mick, i was going to talk about it. Heidi, i dont think you should try to talk them out of doing this, which is what you do. You talk about how terrible it is and it should never happen. It usually comes back i know what ill talk about, mick, in a second. Heidi, it comes back and hurts the republicans. Sometimes they have trouble in the next election because of things like this. You should tell them to go for it. Honestly, thats a legitimate finger pointing because when you look at the senate through the leadership of patty murray and susan collins, they move the 12 bills that theyre required to m move. This is clearly a ho