SpaceX Demand & Cynicism, A Strong Labor Market, & Screwworm 6/8/26

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Bring in show music, please.

**Cameron Costa** (0:59)
This is Squawk Pod, and I'm CNBC producer Cameron Costa. On today's episode, we're digesting Friday's sell-off.

**Becky Quick** (1:08)
The S&P 500 breaking a nine-week winning streak.

**Cameron Costa** (1:11)
First, how the strong May jobs report shook market expectations for Kevin Warsh's first interest rate decision as Federal Reserve chair. The rate hike debate with CNBC's Steve Leesman.

**Steve Liesman** (1:24)
The probability of Federal rate hike this year at 70% this morning for December, up from 44% before the Friday report.

**Cameron Costa** (1:31)
And then the NASDAQ piece. How the SpaceX IPO this week could have played into a rotation out of tech. CNBC's Leslie Picker.

**Leslie Picker** (1:40)
According to BNP Paribas, the firm hypothesizes that retail plus passive flows into the IPO could be about $50 billion.

**Cameron Costa** (1:49)
SpaceX clearly has penned up investor demand, but famed hedge funder Steve Eisman is one investor who's less hyped up about it.

**Steve Eisman** (1:59)
Grok, with all due respect to Elon Musk, is not a world-class AI company. The entire company is being bet on AI in terms of its future, not on space and not on Starlink. Those are his words, not mine.

**Cameron Costa** (2:14)
Plus, Iran and Israel have exchanged fire for the first time since the April ceasefire. And agriculture secretary Brooke Rollins on the screw worm.

**Brooke Rollins** (2:24)
The food supply is not at risk. This is not a virus. It's not a disease. It's just a little pest.

**Cameron Costa** (2:32)
It is Monday, June 8th, and Squawk Pod begins right now.

**Andrew Ross Sorkin** (2:36)
Stand Becky by in three, two, one, cue please.

**Becky Quick** (2:41)
Good morning, everybody. Welcome to Squawk Box right here on CNBC. I'm Becky Quick along with Joe Kernen and Andrew Ross Sorkin.
It's a Monday and we are ready to go. On Friday, the NASDAQ felt more than 4%. It was its worst day of trading since April of last year when you were talking about the tariffs first being imposed.
It was a decline for the NASDAQ of 4.7% if you were looking over the course of the week. The NASDAQ 100 was down by more than 4.75% alone on Friday. We're going to talk more about that. It was something that spread throughout Asia. You saw some steep declines there as well. But on Friday, the S&P 500 breaking a nine week winning streak, it also had its worst week since last May.

**Cameron Costa** (3:29)
First up today, why good news isn't always good news, for the markets at least. On Friday, the Labor Department reported that the US economy added 172,000 jobs in the month of May. That is over double what economists were expecting. Unemployment stayed steady at 4.3% and the report even revised previous months upward, signaling an even stronger labor market. Strong though it was, it means the Fed is less likely to ease monetary policy in the short term, which makes things a little tricky for Kevin Warsh, the new Federal Reserve Chair, who's in the role largely because of President Trump's pressure on his predecessor to raise rates. Let's get back to the show.

**Joe Kernen** (4:14)
A strong jobs report presenting an early challenge to the Fed, and new chair Kevin Warsh, senior economics reporter Steve Liesman has the details. Hey, Steve.

**Steve Liesman** (4:24)
Hey, good morning, Joe. This is really interesting. The recent surge in job growth raising the chance of Fed rate hikes as it shakes up some of the ideas we've had about the economy at the Fed and presents an early test of some of the new ideas of Fed chair, Kevin Warsh. Among the challenges created by those strong job numbers, what is the break even employment rate believed to be between zero and 50,000? And what could it be now with the three-month average job growth of 109,000 and no change in the unemployment rate? What's the neutral rate? Hard to believe this rate currently is restricted with such strong job growth. And is there now concern about jobs and wages raising the inflation risk? Cleveland Fed president, Beth Hammack, saying on Friday, if recent trends continue, it may soon be appropriate to act. And in that sense, it suggested acting being raising rates. The probability of Fed rate like this year at 70% this morning for December, up from 44% before the Friday report, blowing the blue past Wall Street expectations for job growth of 172,000 in May and big upper divisions in the two prior months. And hold on, because there's even now a 52% chance of a second hike, that would be a year from now while everyone from the president to his top economic advisor, Kevin Hassett, are arguing strong job growth is no reason to hike rates. And data also is a test for new ideas of Fed chair, Kevin Warsh. He's criticized this notion that strong job growth creates inflation. He said in recent Senate testimony, here's what he said.