Squawk Pod: "Risk Play: Sports Betting, Prediction Markets & Super Bowl LX"

Podcast: Squawk Pod (CNBC)
Date: February 5, 2026
Host/Anchors: Becky Quick, Joe Kernen, Andrew Ross Sorkin
Key Guests: Senator Bernie Moreno, Author Jonathan Cohen, Citi Analyst Ron Josey, Reporter Contessa Brewer

Episode Overview

This episode dives into the explosive growth and societal impacts of sports betting and prediction markets in the lead-up to Super Bowl LX. Alongside discussion about the massive capital shifts in tech and market volatility, the crew interviews Ohio Senator Bernie Moreno about the Federal Reserve chair confirmation, and Jonathan Cohen, a leading expert on gambling policy, on the risks and regulatory challenges posed by the rise of sports wagering—especially for younger Americans.

1. Market Volatility: Tech, AI & Alphabet’s “Inflection Point”

Key Segment: [01:03]–[07:57]

Main Points

• The markets are mixed as Super Bowl weekend approaches. The Dow is hovering near record highs, while the Nasdaq continues its rollercoaster.
• Alphabet (Google) has exceeded earnings projections, but investors are wary due to massive AI-driven capital expenditures (CapEx).
• The nature of big tech is potentially shifting from capital-light growth companies to “tech as utilities or industrials,” as huge investments are required for AI/cloud infrastructure.

Notable Quotes

• Ron Josey (Citi):

  “You should be investing in growth and I think you should be investing to gain as much possible share as you can.” [01:21]

• Andrew Ross Sorkin:

  “This quarter appears not just about Google but everybody. The first real inflection point where...the psychology of the investment community is no longer necessarily rewarding smart spending.” [07:07]

• Becky Quick:

  “Growth better be good. Justify the gosh darn it…if it’s really good, no one will ever have a job again.” [06:43]

2. Federal Reserve Chair Drama: Confirmation and Politics

Key Segment: [09:30]–[23:50]

Main Points

• President Trump nominates Kevin Warsh as the new Federal Reserve Chair, replacing Jay Powell, and expects “lower interest rates.”
• Senator Bernie Moreno (R-OH) online, is sharply critical of Powell, describing his performance as “inept,” and supports swift confirmation for Warsh.
• The anchors probe the senator on the blurred lines between economic policy, political loyalty, and independence in monetary policy decision-making.
• Debate centers around the proper role of Congress and the president in criminal investigations relating to Fed actions.

Notable Quotes

• President Trump:

  “If he [Warsh] said he wanted to raise [rates], he wouldn't have gotten the job.” [09:49]

• Senator Bernie Moreno:

  “At the end of the day, Kevin Warsh is highly qualified, highly respected. Everybody wants him in there…I hope that we can put all this political nonsense aside and let’s get Kevin Warsh confirmed. Because most importantly, it is a huge upgrade from what we have right now running the Fed, that's for sure.” [17:17, 20:53] “Jerome Powell is the worst Fed Chairman of my lifetime. Kevin Warsh would do an amazing job. Let’s get the guy confirmed. That’s the bottom line.” [22:26]

• Andrew Ross Sorkin:

  “Do you believe that the President of the United States should weigh in on criminal investigations? This goes to the question about the independence of the Department of Justice.” [21:38]

3. Super Bowl LX: Sports Betting Mania, Prediction Markets & Societal Risks

Key Segment: [24:46]–[39:12]

Market Landscape Update

• Reporting from San Francisco: Sports betting remains illegal in California, but new “prediction markets”—offered by platforms like Kalshi and Polymarket—are surging ahead of the Super Bowl.
• Despite legal restrictions, Californians access these markets in droves, with volumes up 1400% year-over-year on Kalshi. This is eating into the business of traditional sportsbooks.

Key Facts

• DraftKings and FanDuel have turned to prediction markets to compensate for lost sportsbook revenue where gambling is illegal.
• Professional (sharp) gamblers locked out by traditional sportsbooks migrate to these new markets.
• The regulatory scene is a swirl: at least 40 state attorneys general are embroiled in legal actions over gambling.

Societal Risks & Public Health Lens

Interview: Jonathan Cohen, Author and Policy Expert

Topic: The sharp rise in youth gambling, financial distress, and what can be done.

Discussion Points

• Gambling is increasingly common among teens: “About a third of 11 through 17 year olds have gambled sometime in the year, including on sports.” [Jonathan Cohen, 32:35]
• Data shows rises in bankruptcies, auto loan delinquencies, and reduced savings/investment in low-income households following the introduction of sports betting.
• Fantasy sports is a “gateway drug”—it’s not quite gambling but socializes youth to the logic of betting.
• Cohen is NOT calling for prohibition. He favors stricter “friction” controls—like loss limits, affordability checks, and self-regulation—particularly for those under 25.

Notable Quotes and Moments

• Jonathan Cohen:

  “Within a few months of the arrival of sports betting…you see an increase in bankruptcies, an increase in auto loan delinquencies, and reduced savings and investment in low income households.” [25:09, 32:35] “I think we should make it all but impossible for someone who’s gambling like me, 10, $12 here and there, for that to be the start of a dangerous journey, for that to be a gateway drug into a more serious gambling problem.” [34:21] “The byword for all of it is friction...There's nothing in the app really that's going to slow someone down.” [35:02] “Gambling really does work like a drug...at some point...to get the same high you used to get...you’re going to go from $5 to 50...all of a sudden you’re on this dangerous journey that you didn’t intend.” [36:25]

• Becky Quick:

  “You've got a long list of potential solutions. I don't know how likely any of these things are...some of this stuff sounds like a little bit of a nanny state.” [34:41] “Your point is that the incentive structures are set up improperly. The more you lose, the more money they make.” [36:54]

• Andrew Ross Sorkin:

  “Self-regulation...is always this sort of super complicated situation because it's so hard to actually, you know, across the board make it work.” [38:11]

Lighthearted Close & Prop Bets

[39:12]

• Jonathan Cohen throws in a Super Bowl prop bet: “I like Kenneth Walker under rushing yards for this first Sunday. I think that's a great [bet].”
• Discussion about the culture of betting: $5 parlays, chasing losses, and the “thrill” of winning.

4. Broader Stories in Brief

Legal Industry Fallout:

• The episode briefly touches on the resignation of Paul Weiss’s chairman after being linked to the Jeffrey Epstein files—a reminder of how reputational risk can roil elite corporate circles.
  Key Quote: “Recent reporting has created a distraction and has placed a focus on me that is not in the best interest of the firm.” [Brad Karp, 11:14]

5. Notable Timestamps

• [01:18] Alphabet’s AI spending and CapEx debate
• [07:07] Market psychology shift: from “capital-light” to infrastructure-heavy tech
• [17:17] Senator Moreno on the Fed and Jerome Powell
• [24:46] California’s sports betting loophole and prediction markets
• [32:35] Jonathan Cohen: The youth gambling trend and public health perspective
• [34:21] Cohen’s proposed solutions for gambling addiction
• [35:02] "Friction" as prevention in gambling apps
• [36:25] How gambling can escalate, psychology of “chasing” losses
• [39:12] Super Bowl prop bets and the culture of casual betting

Overall Tone

• The conversation blends CNBC’s fast-paced, opinionated, and sometimes tongue-in-cheek reporting style.
• Contrasts sobering data on gambling harms with the casual, even flippant, banter that often surrounds big sporting events and financial bets.
• The policy segments are pointed, political, and at times, directly combative—especially in the grill of Senator Moreno and the debate on independence in monetary policy.

Summary Takeaways

• The U.S. financial ecosystem is at a real inflection point: from massive AI spending to changing attitudes on risk and reward.
• The culture and legality of sports betting is in flux, with prediction markets emerging as both workaround and risk. The lack of regulation, easy access, and youth exposure pose public health and policy challenges.
• Experts advocate for “friction” and thoughtful, if complicated, regulation rather than outright prohibition.
• At every level—markets, politics, gambling—risk management, incentives, and responsible policy are increasingly in question.