U.S.-Japan Trade Deal, Capital R(AI)ses, Remembering Larry Bossidy 7/23/25

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Jim Cramer (1:02)

It's Jim Cramer here. You're listening to the opening bell of CNBC's Squawk on the Street.

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Carl Quintanilla (1:10)

Good Wednesday morning. Welcome to Squawk on the Street. I'm Carl Quintanilla with Jim Cramer and David Faber at post night of the New York Stock Exchange. It is risk on as trade deals with Japan, Indonesia, the Philippines start coming into view. Earnings continue to impress with a high beat rate and the meme phenomenon broadens today. It's Krispy Kreme and GoPro of 40 to 80 percent. Our roadmap begins with the US and Japan reaching that trade framework. What's the new agreement about? What does it mean for both economies and the other countries trying to negotiate with the US?

David Faber (1:38)

Plus we're going to keep an eye of course on AI and XAI, that is open AI as well. Both are reportedly, not even reportedly, they're seeking additional capital as the race for expansion of course continues. And those mean names, Coles, Opendoor, cooling off a bit, but others are now joining in on the craze. We talked about it yesterday. We will continue that conversation this morning.

Carl Quintanilla (2:01)

Let's get right to this trade deal with Japan. In a post on Truth Social, the president said Japan will invest about 550 billion into the US, which will receive 90% of the profits. Japan will pay reciprocals of about 15%. Jim, they're going to buy 100 Boeing planes, buy some rice, increase their defense spending with American contractors.

Jim Cramer (2:20)

Well, look, I mean, the time-honored thing is to order planes from Boeing. If Boeing could make them, it would really matter. The Boeing's got one of the biggest backlogs of history. And what I think really matters is that it's template. Look, everybody won on this. I mean, I think that you can easily say the United States won because it's still got a nice tariff. But the Japanese, the stocks are just flying. And what it does is it takes off the table something I was very worried about, which is that the president would be really hard on these guys, and then it would be a ripple effect, and Japan's already got a government crisis. So these are dominoes that don't happen. And I think that people have to recognize, and David, I don't know if you can criticize this view, but some of these things are working. This was a positive, positive for our country, positive for Japan in the end.

David Faber (3:14)

Yeah, I mean, listen, I think at one point, if you had said there are going to be 15% across the board tariffs, or our average tariff rate is going to be somewhere approximate between 10 and 15%, people would have been like, whoa, that's a lot. At this point, we don't seem to be seeing it in the inflation numbers, at least not to the extent, I think, that had been worried early on. But 15% is still a real number. I don't know to what extent it damages the competitiveness of Japanese automakers, but it is down from 25 and conceivably even higher. So a lot of this looks good. You can see the reaction, of course, in the names that we're talking about there that do export a lot of their product. Not to mention make a lot of them in this country as well.

Jim Cramer (3:52)

Right, right. It didn't matter. Now, David, would you call this the art of the deal?

David Faber (3:58)

Would I call it the art of the deal?

Jim Cramer (3:59)

Yeah, well, I'm saying that you start, you move the tariff up real high and then negotiate down. People feel like, wow, that was good.