Squawk on the Street (CNBC)

2nd Hour: December Jobs Report, Supreme Court Tariffs Decision, Goldman's Takeaways, Rockefeller's Ruchir Sharma

Date: January 9, 2026
Hosts: Sarah Eisen, Carl Quintanilla, David Faber
Key Guests: Mohamed El-Erian (Allianz), Jan Hatzius (Goldman Sachs), Tobin Marcus (Wolfe), Phil LeBeau, Brian Sullivan

Overview

This episode centers on the release and analysis of the December 2025 Jobs Report, anticipation around the Supreme Court’s (SCOTUS) tariff decision, and reactions from major market voices. In addition to economic analysis, the hosts cover pressing business developments, including changing EV strategies at GM, President Trump's new housing policies, and emerging energy news.

Key Discussion Points & Insights

1. Supreme Court’s Pending Tariff Decision ([01:08]–[05:51])

• Background: Companies await clarity on whether $133B in “IPA” tariffs (imposed using the International Emergency Atomic Economic Powers Act) are legal. If SCOTUS strikes down the tariffs, the US government may owe massive refunds to impacted companies.

• Current Status: Supreme Court issues no decision today on tariffs, leaving companies and White House officials in limbo.

• Fallback Plans: Discussion that the White House is prepared with alternative legal justifications should SCOTUS rule against the current tariffs.

• Economic Stakes: Delay in decision prolongs uncertainty for businesses paying daily tariffs. Companies are pressuring for a prompt ruling.

  “So if those tariffs are struck down by the court today, ... the US government would be expected to repay that 133 billion dollar to the companies that sent those checks … a lot at stake.” — Eamon Javers, [02:32]

2. University of Michigan Consumer Sentiment & Inflation Data ([06:05]–[07:45])

• Key Data: Sentiment rises to 54—best since September of previous year; inflation expectations stable but still “warm.”

• Market Impact: 10-year Treasury “hovering” around 4.19%, with key resistance noted at 4.20%.

• Tariff Sentiment: Consumer worries about tariffs are “gradually receding.”

  “These are University of Michigan sentiment with inflation gauges ... Headline number comes in better than expectations at 54.” — Rick Santelli, [06:15]

3. December Jobs Report: Headline and Nuance ([08:18]–[14:53])

• Results: Unemployment drops from 4.6% to 4.4% (actual 4.375%), but only 50,000 jobs added—a notable shortfall. Payroll growth was revised lower for prior months.

• Interpretation:

  • Wage growth persists at 3.8% YoY.
  • Labor supply tightness linked to immigration and visa restrictions.
  • GDP tracking is robust (Atlanta Fed projects 5.4% for Q4).

  “I'm always an optimist ... unemployment rate fell ... that was good news. ... The bad news is we didn’t get as much payroll growth as expected ... only grew 50,000 jobs during the month. That was weak.” — Sarah Eisen, [08:18]

4. Mohamed El-Erian Analyzes the Labor Market & Policy ([10:59]–[19:14])

• Key Takeaways:

  • "No drama" report; labor market decoupling from output, reflecting higher productivity.
  • Raises 3 major points: Who benefits from increased productivity, the affordability crisis (wages vs. costs), pending impact of next week’s CPI.
  • Noted that pretax corporate margins are near record highs, while the employee share of corporate income remains low.

  *"It is the weakest year of job growth outside of recession in 20 plus years. Is that okay?"

  "It is okay for where we are in the cycle. ... there's something for everyone in this report and it's no drama …" — David Faber & Mohamed El-Erian, [11:11–11:14]

• AI and Worker Displacement:

  • Calls for a shift from viewing AI as cost minimization to seeing it as a tool for worker enhancement.

  "Let's stop talking about those working on AI and let's talk more about those working with AI. Because unless we have a policy for those working with AI, it’s going to harm labor in a major way." — Mohamed El-Erian, [15:30]

• SCOTUS/Tariff Impact:

  • Expects minor macro effect, possible legal and industry “mess” at the micro-level.

  "At the macro level, it won’t matter. The administration will come with plan B if ... they reverse it ... At the micro level, there may be huge legal debates by companies reclaiming something on an old law that is now illegal." — Mohamed El-Erian, [17:09]

5. Global Trade and Tariffs: Europe & China ([17:46]–[18:41])

• Global Perspective: Trade continues to expand elsewhere as US legal battles loom. Europe on verge of restricting Chinese imports, especially autos.
• Structural Challenges: Europe notably behind in AI and broader competitiveness.

6. SCOTUS Tariff Scenarios with Tobin Marcus ([21:09]–[25:40])

• Deliberations Indicate Complexity: Longer wait may mean difficult, closely split court deliberations.

• Refund Likelihood: Most investors doubt practical possibility of full refunds, expecting court to strive for a middle ground—possibly voiding tariffs prospectively, but no retroactive repayments.

• Likely Outcome: Administration will reimpose tariffs using alternative authority; no significant sectoral expansion expected.

  "There is a lot of investor skepticism ... about the notion that refunds are actually going to go out, not for any legal reason, but just because the logistics ... boggle the mind." — Tobin Marcus, [22:16]

• Macroeconomic Impact: Only significant if $130B in refunds are issued, which is considered unlikely.

7. Market Movers and Policy Announcements ([27:17]–[28:49])

• Housing: President Trump proposes $200B government purchase of mortgage bonds (via Fannie & Freddie) to lower homeownership costs.
• Commodities: Glencore/Rio Tinto $260B merger talks resurface.
• Energy: Meta signs a 20-year deal to buy nuclear power for AI/data center growth, supporting development of small modular reactors.

8. Goldman Sachs’ Jan Hatzius on Jobs, Inflation, and Housing ([30:07]–[36:49])

• Jobs Report View: Weak on job creation, somewhat offset by stronger-than-expected drop in unemployment rate. Average job growth: 15,000/month over last six months.

• Fed’s Stance: Focus likely on demand/supply balance in labor market; more weight to employment than GDP right now due to data noise.

• Inflation & Wages: Expects 2026 to be disinflationary; tariff pass-through explained some stickiness in 2025, but underlying measures are softening. Forecasts core CPI at roughly 2.1–2.2% by year end.

• Mortgage Policy: Trump’s housing move through GSEs could compress mortgage spreads, but long-term yields not expected to drop far due to high federal debt and increased term premium.

• Manufacturing: Continued stagnation—75,000 jobs lost YoY. No quick turnaround expected despite supportive policy (e.g., tax changes).

  "If you look at the last six months, we’ve created like 15,000 jobs per month. ... On the other hand, the unemployment rate news was better ... I think if I’m the Federal Reserve, that’s probably what I’m going to be more focused on." — Jan Hatzius, [30:31]

  "By year end we’re at 2.1, 2.2 percent ..." — Jan Hatzius, [33:37]

9. EV Industry Pullback: General Motors ([37:21]–[40:44])

• Headline: GM takes a $6B pre-tax impairment charge for EV investments; further charges expected in 2026 amid a drop in US EV sales (-43% in Q4). Only 7.8% of US auto sales in 2025 were EVs.
• Strategic Shift: Both Ford and GM pulling back on prior EV commitments, shifting focus to hybrids and select EV production.
• Broader Trend: Follows Ford’s recent announcement of $19.5B in EV-related charges.

10. Energy Geopolitics: Venezuela and Oil Majors ([41:27]–[47:09])

• White House Meeting: President Trump meets oil execs seeking commitments (investments, security guarantees) for Venezuela’s energy sector revival.
• Industry Response: Oil majors want legal certainty/security before committing; smaller firms may enter Venezuela first, larger players may follow via partnership.
• Regional Dynamics: Other Latin American producers (notably Brazil) highlighted; possible future trade or exploratory missions to Venezuela.
• Broader Oil Market: Moves in Venezuela may influence global oil supply and have political ramifications, especially with ongoing unrest in places like Iran.

Notable Quotes & Memorable Moments

• "The Supreme Court kind of, you know, sends these decisions down from Mount Olympus and we stand here waiting to hear what they have to say." — Eamon Javers, [05:03]
• "It is the weakest year of job growth outside of recession in 20 plus years. Is that okay?" — David Faber, [11:11]
• "We need to stop talking about those working on AI and start talking more about those working with AI." — Mohamed El-Erian, [15:30]
• "There’s a lot of investor skepticism ... about the notion that refunds are actually going to go out, not for any legal reason, but just because the logistics ... boggle the mind." — Tobin Marcus, [22:16]
• "By year end we’re at 2.1, 2.2 percent ..." — Jan Hatzius, [33:37]

Timestamps for Key Segments

• [01:08] – Supreme Court Tariff Decision Preview
• [06:05] – University of Michigan Sentiment & Inflation Data
• [08:18] – December Jobs Report Breakdown
• [10:59] – Mohamed El-Erian Interview
• [15:30] – AI’s Impact on Labor Policy
• [17:09] – Macro/Micro Impact of SCOTUS Tariffs Ruling
• [21:09] – Tobin Marcus on SCOTUS Scenarios
• [27:17] – Market Movers & Policy Announcements
• [30:07] – Jan Hatzius (Goldman Sachs) Jobs & Inflation Analysis
• [37:21] – Phil LeBeau on GM’s EV Write-Down
• [41:27] – Brian Sullivan on Venezuela Oil Talks

Tone and Style Highlights

This episode is characterized by real-time, frank market assessment, with hosts maintaining their signature blend of insightful expertise and conversational, sometimes playful, rapport. Guests like Mohamed El-Erian and Jan Hatzius offer calm, evidence-based perspectives, stressing nuance and uncertainty where warranted.

Summary At-a-Glance

• No SCOTUS ruling on tariffs yet; companies and government anticipate impactful decision.
• Jobs report is mixed: falling unemployment rate offsets weak hiring.
• Productivity and AI increasingly decouple GDP from job growth, raising questions about the future distribution of economic gains.
• Goldman Sachs sees inflation cooling toward target, and expects little policy movement from the Fed in the near term.
• Auto industry pivots as Ford and GM retrench on EV plans amid weak demand.
• Energy markets watch for seismic shifts as the US explores a potential re-engagement with Venezuela’s oil industry.
• Housing policy and global trade developments add further layers of complexity — but little immediate macro impact is expected absent a big SCOTUS surprise.