Trump and Powell, Musk-Altman Feud, Shopify Pres., SNL 50 at the NYSE 2/11/25

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Jim Cramer (0:59)

It's Jim Cramer here. You're listening to the opening bell of CNBC's Squawk on the Street. Don't miss a minute of the action.

Carl Quintanilla (1:12)

Good Tuesday morning, welcome to Squawk on the Street. I'm Carl Quintanilla, Sarah Eisen, Mike Santoli, and Post 9 of the New York Stock Exchange. Cramer and Faber have the morning off. Futures a bit red, 10-year back above four and a half. As the president signs those tariffs on steel and aluminum and the EU pledges retaliation, Powell's on the Hill. There'll likely be a lot of questions about all of that. Our roadmap begins with Elon Musk, though, escalating his feud with Sam Altman and OpenAI, making this $97 billion bid for control of the company. We've got the latest.

Sara Eisen (1:40)

Plus Coca-Cola, the biggest gainer on the Dow this morning, easily topping earnings estimates on strong global demand. The company's chairman and CEO, James Quincy, will join us to discuss next hour. Also, shares of Shopify shares are moving higher in the pre-market despite a weaker outlook. We're going to discuss the quarter with Shopify's president, Harley Finkelstein. It was a pretty good quarter across the board.

Carl Quintanilla (2:02)

Let's begin, though, with the president's 25% tariffs on steel and aluminum imports and the Fed share going to Capitol Hill to testify on the economy before Senate banking today. Obviously, lots of buckets that lawmakers will quiz them about, but one might be the effect of the tariffs would be retaliation, the prospect of even further industries getting affected and what that does to things like capex intentions, which we got to look at today.

Sara Eisen (2:25)

And we don't expect him to really say anything as far as what it will mean for Fed policy because that's been his posture and it's too soon to know. Is it a one-off inflationary shock? Is it something more prolonged? Is it something the Fed would have to respond to? These are all questions investors have, but he hasn't been able to nor is willing to give any sort of answers or speculation about what they might do. This is one of those interesting two days of testimony where tomorrow, usually second day is very boring and he repeats himself, but tomorrow might be more interesting because we get CPI out tomorrow morning, the inflationary number. And look, there's been a little bit of angst lately about rising inflation expectations. Certainly saw that in the University of Michigan. Didn't get backed up in the New York Fed survey, so that's a good thing. But we've seen the break evens, especially on the short end, move a little higher, which indicates there's a little bit of worry, Mike, that all these tariffs are eventually going to lead to higher inflation. And that's the backdrop for Powell.

Michael Santoli (3:22)

Without a doubt. Also, though, a little bit of hesitation about what we've seen the last couple of years, which is inflation coming into the year hot. And so January actually was a cause to have a rethink as to whether inflation was coming down. And so that's the environment. I think the idea of him trying to send the message of wait and see, we need to see what tariffs mean in practice, we need to have it flow through the data, fits right in with his preferred mode right now, which is there's not a lot of reason why Fed policy should be changing very quickly. Whether that's true or not, I think that's where he prefers to sit, feeling like we made the 100 basis points adjustment right now, the economy is fine, you can make your case as to what the actual underlying trend of inflation is.

Interesting at the press conference recently, he had to, or actually more in December, he had to give a nod in the direction of some people on the committee clearly tried to make guesstimates about what the tariff and policy impacts would be on inflation, and it changed their dots. Well, he doesn't want to do that, but he had to make that accommodation there. I think that's a good debate as to whether, for example, the steel and aluminum tariffs, big impact on a really narrow part of the economy in the stock market. Let's be honest, it's not really a huge swing factor. We've kind of dealt with it before. We saw the price moves in, you know, metals and mining are 0.4% of the S&P 500 Consumers, big consumers of steel and aluminum are bigger, but they're already trade at depressed multiples. So it's not going to be the mover of the market, and it almost seems like it's a targeted and tactical gesture as opposed to across the board.