May 14, 2026
WHEN: Today, Thursday, May 14, 2026
WHERE: CNBC’s “Squawk Box”
Following is the unofficial transcript of a CNBC interview with U.S. Treasury Secretary Scott Bessent on CNBC’s “Squawk Box” (M-F, 6AM-9AM ET) today, Thursday, May 14. Following are links to video on CNBC.com: https://www.cnbc.com/video/2026/05/14/treasury-secretary-scott-bessent-u-s-can-hold-ai-talks-with-china-because-awe-are-in-the-lead.html, https://www.cnbc.com/video/2026/05/14/treasury-secretary-bessent-expect-substantial-disinflation-after-1-2-more-hot-inflation-numbers.html, and https://www.cnbc.com/video/2026/05/14/watch-cnbcs-full-interview-with-treasury-secretary-scott-bessent.html.
All references must be sourced to CNBC.
PART I
JOE KERNEN: I did speak with him in the middle of the night, here, over there it’s like the afternoon or something, and I started by asking him to delineate any concrete progress that has come out of his meeting earlier with with the Vice Premier and what is likely to come from the President's summit with President Xi. Here it is.
SCOTT BESSENT: Joe, the Chinese don't like any surprises, which is why President Trump is especially effective with them. But the Vice Premier and I, who have a very good working relationship, I think we've seen each other, this was either eight or ninth meeting, worked on the agenda for today's meeting in terms of the economics, the deliverables. And so, we talked about purchases. We talked about some issues that the Chinese side had. And we're going to talk about forming a board of trade for the bilateral trade between the U.S. and China. And we're going to talk about a board of investment that will be responsible for investment in non-sensitive areas.
KERNEN: Mr. Secretary, you know, foreign investment in the U.S. is always a priority for this president, and I'm sure he'd like to announce a commitment that starts with the T-word, with the letter T, or trillions of dollars from China to make its way onto our shores. How do, how do we balance such an increase in cooperation with all the ongoing security concerns we have with a country that we know wants to eventually eclipse the United States?
BESSENT: Well, again, Joe, I'm not sure where this trillion-dollar investment number has come from. It's somehow gotten out into the ether. And the purpose of this board of investment is to decide up front, what are the non-strategic, non-sensitive areas where it would be possible for the Chinese to invest. I chair something called CFIUS, the Committee on Foreign Investment in the United States. And what we want to do is make sure that these investments don't get referred to CFIUS. So this would pre-game those investments just to make sure that they're not of a strategic or sensitive area. But look, there are plenty of things that the Chinese could invest in, in the U.S. and we're trying to push the same thing in the U.S. President Trump today told Xi Jinping that he wants to open up China, and China should open up. China's domestic economy has been weak. The Chinese consumer needs to get a larger share of wages, or labor needs to get a larger share of the GDP. It all tends to go back into manufacturing now, and China really needs to create a bigger consumer economy. And President Trump and the entire administration have been pushing them to do that.
KERNEN: Sir, there's a report from “Reuters” that just came out that the U.S. has cleared around 10 Chinese firms to buy Nvidia's second most powerful A.I. chip, the H200. No deliveries have been made so far, but this is obviously something that CEO Jensen Huang probably would like to see happen as far as a breakthrough. Can you, can you confirm that's true and which companies would be allowed, approved which Chinese firms to buy those chips?
BESSENT: Yeah. Joe, this is news to me. I know there's been a lot of back and forth on the H200 and we'll have to see on that. That's a Commerce Department function.
KERNEN: Okay. At the same time, there's some competing narratives about the overall environment that we're looking at there. China's export economy continues. Xi apparently wants to show that he will not be bullied. Meanwhile, China is feeling the pinch from a myriad of internal and external pressures that we talk about, whether it's real estate, and I think it's in their best interest to stabilize relations with the U.S. But at the same time, President Trump is, would probably like to announce some positive news at this point. He's brought all those business leaders. Who is in a stronger bargaining position, in your view? Who needs a deal more in your view and has the upper hand?
BESSENT: Well, I, again, the U.S. is the deficit nation in terms of trade. And I used to teach economic history and the his – economic history would tell you that the deficit country always has a stronger position because we do have a deficit. And we are China's largest customer. Although President Trump has brought the trade deficit down to, it seems crazy to say, only $200 billion. He's laser-focused on getting it into, into balance. And that's, that's the goal here. And that can be done one of two ways. Either the U.S. receives fewer imports from China, or we sell more to China. And we're trying to balance that out. What's happened to China over the past year has been President Trump put up the tariff wall, and China continued to push out goods into their export market. But the U.S. much of that market was blocked, and the goods went to the rest of the world. And there was a lot of price pressure on those goods. So I don't know if you're familiar with the old saying, Joe, is we lose a dollar on every item, but we make up for it in volume. So the Chinese have tried to make up for it in volume. They've got a tremendous trade surplus. But if you look at the statistics, the profitability of the Chinese firms is way down. And that is even with massive subsidies from the government.
KERNEN: We had Steve Daines, the senator on yesterday, just returned from China after leading a delegation, Mr. Secretary. He told us, I hadn't heard this before. The three Bs, Boeing, beef and beans. Will those all be discussed? And what else?
BESSENT: Well, those are big. I think we're going to see the large Boeing orders. Beef was more, they're not, they're non-tariff trade barriers against our great American ranchers. The, and then soybeans, we have a very large purchase commitment from the Busan agreement that for the next three years. So beans are really all taken care of. Although if I were the Chinese, I'd probably buy more beans now because there's a weather pattern called El Nino that we're probably going to see this year that typically results in very high soybean prices.
KERNEN: Could there be some breakthrough on tariffs? I there, is another report that the two presidents may discuss cuts on roughly $30 billion worth of imports. Do you know which sectors are on the table there? And is this a good way to do it? To pick winners and decide which ones we're going to allow in without tariffs and which ones we won't?
BESSENT: So we're going to form a board of trade.
KERNEN: OK.
BESSENT: And the idea will be for the, non-critical, non-strategic areas things that the U.S. doesn't want to make that we're never going to reshore. So something like fireworks or very low-end consumer goods that are going to keep coming from China no matter what. So we can un-tariff those. And then there are many things that they want to buy from us. There was talk today about the Chinese buying more U.S. energy, and the U.S. is exporting a record amount of crude and LNG. Now, the only binding constraint is our export facilities. We're going to be building more export facilities. We're going to be ramping up in Alaska, which is a natural for China. And given what's going on in the Mideast, we think that not only China, but countries all around the world are going to look to diversify away from the Middle East for more stable source of energy, and what better place than the U.S. But the idea of starting with $30 billion by $30 billion that both sides can designate, again, for non-critical areas and areas that we’re not trying to reshore.
KERNEN: Mr. Secretary, do you have a sense on whether China will help with the strait and what China has communicated to us about the Strait of Hormuz? And, I mean, it's obviously important to them as well. Do you think they're going to help?
BESSENT: I think they're going to do with, do what they can. And here, the, China has a much bigger interest in reopening the strait than the U.S. does. China gets about a third of its energy needs from the Gulf. So, a reopening of the strait benefits China. Unfortunately, they've been buying, they were the largest consumer of Iranian oil. They were buying about 90 percent of it. Iranian oil represented about 10 percent of their energy that they took in. But the rest of the countries in the Gulf were also substantial contributors, whether it was Saudi, UAE, Qatar. And China gets a substantial amount of their LNG from the Gulf also.
KERNEN: You've talked about—
BESSENT: It’s, where we have—
KERNEN: I'm sorry, sir. Go ahead.
BESSENT: No, I was just going to say that China, it's very much in their interest to get the strait reopened and I think they will be working with, behind the scenes, to the extent anyone has any say over the Iranian leadership. And the real problem here, Joe, is, as you're aware, we didn't change the regime, but the regime changed. And, you know, it was several layers of leadership that were decapitated. And it's very tough there just to communicate anything to anyone who is able to either act or get a, get an overall agreement and speak on behalf of the Iranian leadership.
KERNEN: Yeah. You've talked about this a lot, Mr. Secretary, and that is the strain that Iran is under right now, severe strain with the continuing blockade, hyperinflation, plunging currency, food and water shortages. The supreme leader, allegedly, as you said, we're not sure who we're talking to at times. Allegedly, it's begged companies to stop laying off workers for the good of Iran. Is there a breaking point for a regime whose priorities don't include the welfare of its people?
BESSENT: Sure there is, Joe. And what we're seeing is the loading facility, the main loading facility for Iranian oil is a facility called Kharg Island. We've seen that there have been no loadings in the past three days. We believe their storage is full. None, none of the ships are getting out. None are coming in. So they're not able to store oil on the water. So they're going to start shutting down their, they're going to start shutting down their production. We can see that that's happening from satellite photos. But more importantly, Joe, exactly as you said, this is a diabolical regime. Thus far this year, they've executed 30,000, 40,000 people. Many, many of them peaceful protesters. And so how do you deal with a regime like that? You squeeze them economically. And we believe we're at the point where soldiers aren't getting paid. They're not able to replenish their weapons stocks from abroad. So, I think that they are on their last legs. And the blockade, President Trump's blockade has been a resounding success.
KERNEN: The, at the same time, it's still a blockade on oil. Oil is up at over $100 a barrel today just on West Texas, even higher on Brent. Do you still believe that the surge we've seen in gas prices, and inflation in general had some hot numbers, PPI yesterday, CPI earlier. They're hot. Do you view that as a, as something that will be reversed quickly if the strait is reopened? And I guess I'd go on to say, do you think the president will accept no rate cuts right off the bat from the new Fed chief, Kevin Warsh?
BESSENT: Well, lots to unpack there, Joe. So let's, let's do it one by one.
KERNEN: OK.
BESSENT: I think in terms of what we're seeing, I think in terms of what we're seeing here, you know, we can see that crude, West Texas crude, six, nine months out, is substantially lower. The curve is in substantial backwardation. That's when the front month is much higher than the back month. So I believe the crude will come down quickly. We've seen the UAE come out of OPEC. So the market's going to be very, very well-supplied. I think all the other energy producers, having not gotten oil out for a long time, are going to pump like crazy. And as I said earlier, the U.S., we're at record production. We're an energy superpower, and we're just going to, we're going to keep pumping. So I think there's a potential for energy, crude, gasoline to come trundling back very quickly, which will mean that the look through to inflation will also come down very quickly. I was never on team transient during COVID, and a lot of that had to do with what happened with very expansionary fiscal policy that was financed by debt purchases from the Central Bank, kind of an experiment in modern monetary theory that caused inflation. And, but here, I firmly believe that nothing is more transient than a supply shock. And we can, we can look through that because before the Iranian conflict began, core inflation was coming down. So I think core inflation will continue coming down. We'll get to the other side of this, and I don't know whether it's a few days or a few weeks, and energy inflation will come back down. And we've got the start of the Warsh Fed. Kevin was confirmed last night. Only one Democrat, John Fetterman from Pennsylvania, voted for him. Just shows the dysfunction of the Democratic Party. He got a 99 voice vote when he was a governor last time. And I think that he's going to bring an open mind to this. And I actually think he's going to be in a very good position, because we may get a series, one or two more hot inflation numbers, but then I think we're going to see substantial disinflation.
KERNEN: I know that, you know, we talked briefly about the Nvidia chips. And there's this A.I. We just can't go a sentence on CNBC without mentioning A.I., Mr. Secretary. There's a front-page piece today in “The Journal”. I don't know if you've seen it about Anthropic surpassing OpenAI in a lot of different areas. And, you know, you say Anthropic and it just conjures up all kinds of things, whether it's, you know, being on the blacklist or whatever you want to call it with the U.S. and Mythos. Hackers can use that. How do we, you know, how do we navigate through the A.I. sitch in your view?
ANDREW ROSS SORKIN: Okay, we're going to pause that interview for just a moment, because President Trump is beginning to speak in Beijing right now. And let's take that live.
PART II
KERNEN: Let’s get back to our conversation with Secretary, Treasury Secretary Bessent. I asked him, you probably saw if you were watching earlier, how he sees the U.S. navigating through the A.I. revolution.
BESSENT: Well, the, all three of the leading companies, Anthropic, OpenAI and Google/Gemini, their large language models are increasing in power very quickly. We saw a step function jump with Anthropic Mythos. I think we're going to see a big step function jump with OpenAI’s next release. And I think in a few months, we're going to see a big step function jump with Gemini. And, Joe, first of all, the good news is the U.S. is the undisputed leader in the world here. We have the greatest A.I. companies. We're actually going to be discussing the A.I. guardrails with the Chinese. It will, because the Chinese are substantially behind us, but they have a very advanced A.I. industry here. So the two A.I. superpowers are going to start talking. We're going to set up a protocol in terms of, how do we go forward with best practices for A.I. to make sure non-state actors don't get ahold of these models. And you know, Joe, what I will tell you is all three of the big players have been very good partners with the U.S. government because what we don't want to do is stifle innovation. So our responsibility is to come up with the highest performance calculus, where we can get the most innovation and the highest level of safety. And we, I am very satisfied that we are well on our way to that. Everything has been voluntary on the, by the companies, and they have been very good partners with the U.S. government.
KERNEN: And we will be open to working with the leading companies, whether it's Anthropic. There's not, will there be eventually some type of resolution to some of the issues, whether it's, whether it's Mythos, whether it's supply chain issues with Anthropic? Will that be handled? What can you tell us?
BESSENT: Again, I'm not going to speak for the Department of War. I would isolate their issue with Anthropic. Anthropic has been very engaged with the White House, with Treasury in terms of Mythos and, you know, all their new releases. So I think, Joe, the way to think about it here is with these large model, large language models now, we had a big step function increase. And the U.S. government has begun consulting with the firms. And again, we don't want to stifle innovation. We're just consulting with them. They've been very good partners. And going forward, I would think that we will be much more on a ramp than a step function in terms of what we see, how the models affect the business community, and we're going to be working with the companies to ensure that everything, where there are vulnerabilities, they get patched. At Treasury, we've been working with the 11 largest banks, and now we're taking that down to the super regionals. And they are compiling data for us that we will then start sharing with the small and community banks. So again, the process is working very smoothly, and I am highly confident that we can have a very good transition into this exciting new technology. And, Joe, you know, sitting here in China right now, it is of the utmost importance that the U.S. maintain our lead in A.I. The reason we are able to have fulsome discussions with the Chinese on A.I. is because we are in the lead. I do not think we would be having the same discussions if they were this far ahead of us. So we're going to put in U.S., the best practices, U.S. values on this, and then roll those out to the world.
KERNEN: So many times I’ve, and this will be the final question. I know you got to run, Mr. Secretary. But you have so many different hats. I'm going to ask you, it's kind of a Treasury, kind of a secretary of war question, I guess. Will Taiwan come up? Do you know whether President Xi is going to ask President Trump to change the long-standing strategic ambiguity? Or will there be any requests from President Xi to limit arms sales to Taiwan at this point? Do you know? Can you comment on that at all?
BESSENT: Sure, sure, Joe. It wouldn't be a U.S.-China summit without the Taiwan issue coming up. And I'm confident that President Trump, the, understands the issues around that and the, is very resolute the, in his answers. And I'm sure we'll be hearing more from him in the coming days on that.
KERNEN: Do you think at this point that the president would, I don't know, give a concession to President Xi and perhaps, I don't know, like I say, change the long-standing practice that we've had of, I don't even, it's so ambiguous. It's hard to even describe, but we're kind of like, don't have an opinion on whether Taiwan should be part of the mainland or not. Do you think that will change?
BESSENT: Again, I'm not going to get out ahead of the president. You'll be hearing more from him either this evening, tomorrow. But again, President Trump is the, understands the issues here and understands the sensitivities around all of this. And you know, anyone who's been saying otherwise does not understand the negotiating style of Donald Trump.
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