Tech’s Tough Week, Reaction to Apple's Two-Day Slump, Goldman Sachs CEO Exclusive 9/8/23

SPEAKER_1 (0:00)

What do you see on the horizon for financial markets?

From uncertainty to opportunity, PGM can help you rise to the challenges of today, when disciplined risk management is needed most. With $1.2 trillion in AUM and deep expertise across asset classes, our investments shape tomorrow, today. Pursue your tomorrow with PGM, a leading global asset manager.

David Faber (0:31)

Market insight and analysis. You're listening to the opening bell of CNBC's Squawk on the Street.

Good Friday morning.

Carl Quintanilla (0:37)

Welcome to Squawk on the Street. I'm Carl Quintanilla with Jim Cramer at Post 9 of the New York Stock Exchange. David Faber's on assignment. Bull's trying to shake off some of these China concerns that have dinged Big Cap Tech. Apple is up slightly pre-market. We await some used car inflation data, watching POTUS at the G20 today. A roadmap begins with the macro though, and the Fed, Williams says rates are in a pretty good place.

Goolsbee suggests hikes almost done while Dallas' Lori Logan says more hikes may be coming. Goldman is planning a new round of cuts. You'll hear what David Solomon told Faber yesterday.

And the UAW rejecting GM's latest counteroffer, B of A now saying that a strike is, quote, almost guaranteed.

Let's begin with the markets though in the NASDAQ's four-day losing streak. Jim had some firms come out. Morgan Stanley tried to defend. What's going on with Apple, at least?

Jim Cramer (1:26)

Look, the work that I've done, I spent a lot of time on yesterday, saying it's just political ammo. We have to be careful how much we put in to the idea that there is a real war against Apple.

Their Huawei phone is selling well, but that's not unusual. Huawei is the preeminent phone there, and I know that you feel that, well, it's 5G.

All these things were, every time we've had a new phone from Huawei, it's been a triumphant phone. I mean, it's a low phone. People like it, but this has killed the NASDAQ. What you saw was some separation yesterday. You saw people buying stocks that were not semiconductor related, but just trashing all the semis. Semis still call the tune in the NASDAQ. The enterprise software was very strong yesterday. So I don't know. I mean, I look at this and I just say, it's September. And September is a month that you don't like the stock market. And what you're seeing is everything is kind of magnified.

Carl Quintanilla (2:22)

The bad is magnified. Sure.

Morgan Stanley, Eric Woodring's point is that the market is hinting they're not just worried about Huawei 5G, but that the notion that China is going to turn inward to a large degree. And that's 30 billion in operating profit.

Jim Cramer (2:38)

I've been saying that this is an insular government.

It could absolutely hurt them.

They don't seem to be all that upset if the US pulls back. Remember, they used to be number one trade partner. Now, Canada and Mexico are number one trade partner. There's a really amazing article in Atlantic Monthly that just came out last night, which just says his days are numbered.

She's days are numbered. Now, I know that people feel that you can never overthrow him, but they may think that that is a wrong takeaway from the article because it's so severe, but it's just about how the models fail. It's time to move on, and the models fail because of unemployment. So you take on one of the largest employers, and you just say, okay, well, look, I don't care. Well, that's something that she might want to do, but there are other people in the government, and they're not buying it. When political elders talk to the press, we once saw someone basically escorted from the building because he was against it. Oh, that's right. That's not happening anymore, and the Atlantic piece is devastating. There's also pieces I'm learning about how the Belt and Road Initiative, which is like when you go to Milan, Italy was the biggest embrace of the Belt and Road. This is their foreign policy. They're thinking about pulling out in December. A lot of countries turn out they're in debt to China. This is not China's time. They're being eclipsed. And we all, I think, are very saddled thinking it's all that matters.

I'm not saying it doesn't matter, Apple certainly is. I am saying that this one may be past its peak, and the past its peak is not Apple, it's China.

Carl Quintanilla (4:06)

Interesting, George Will, a great column today about how China's economy is getting calcified with this Leninist thinking.

Obviously, Xi is not going to the G20. POTUS is not going to meet with Premier Li, we don't think. And then B of A with this chart, you mentioned Mexico. We're trading more with Mexico than we are with China for the first time in 20 years.