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watching like an egyptian ♪ ♪ all the kids in the marketplace say hey, oh, hey, oh ♪ ♪ walk like an egyptian good tuesday morning i'm carl quintanilla with morgan brennan and jon fortt live at post 9 of the new york stock exchange we'll start with tesla, obviously surging today more than 15%, crossing over $900 at the open, doubling since the start of the year. our mike santoli says it's traded eight times the amazon or apple. we'll talk about why -- are have you changed your tone, pierre, given that your target remains unchanged at $800? >> you can't say i've changed my tone my tone remains exactly the same

we have graded tesla a few weeks back, $800 price target. 2 million to 3 million units in 2026 and if you put that into the stock, it's probably worth $800 today. i think at $800, the stock reflects a company doing 2.5 million units in 2026. they could do better than that, a bit less than that it will be difficult to get a fundamental catalyst giving you increased confidence on whether they can do better than that the second thing -- go ahead >> you called out for a potential miss on margins in q1 and a y disrupting the three in your view. how confident are you in that call >> it's not a call, actually what i did in that piece of research for my client investors is to describe what could be the thing that could hurt the stock

from today's levels. i listed four things the first one is the end of the short. it's very high came down significantly yesterday, coming down again today. it's a short squeeze when you get out of that, it cruises back then there are three other things that could hurt the stock. the first one is a miss on gross margin in q1 i do think when the shanghai factory runs it's going to weigh 2 to 3 points on gross margins in q1 and i don't see that in expectations i don't mind it because it's going to be pulled back from gross margin and a second strong, but the street doesn't anticipate that can potentially hurt the stock in the near term. the second thing i saw is the model y is going to be very successful i see 20% of people who buy a

model 3 are trading in an suv. i think that crowd is going to move very fast when the model y is available i think deliveries will continue to go. but when model y takes off it's going to be disrupted, and that could create a reason for the stock to pull back and then the last one is factoring in berlin, tesla has a high pace of building new factories in china, i think in germany things will take a bit longer >> how about the fact that, in addition to being a car manufacturer, this is a company with solar roofs, power generation, elon musk has talked about an insurance offering that's going to roll out when do these factor into this name and how important are they to a sustained bull thesis here? >> a very good question. all these upsides that you listed i'm very hopeful about them, so insurance business

could add 30% to tesla's profits, and then the autopilot, having a unique and highly different autopilot feature could increase gross margins by five points. last but not at least, this is still very uncertain, but elon musk thinks ultimately the energy storage business of tesla is going to be the larger of the car business these three things could add enormous value to what we see in tesla today. our view is over the next year, we're not going to see anything really making us significant more confident on these dimensions these are things that will play out more than a year from now. >> this thing got that $800 price target of yours and pretty

down quickly how high would it have to go for you to say it's too rich >> that's a good question, jon but, you know, remember this $800 price target i gave is a one-year price target. behind that, a 2025 price target, it could be $1,400 so you have room before i think the stock is too rich, definitely >> pierre, you mentioned the short squeeze that's been playing out here, another key factor in terms of the activity and a huge surge of volumes we've seen per mike santoli, also retail investors buying in. you can see from robin hood and other data points. is it good or bad that you have all these retail investors buying in when the stock chart has been so parabolic? >> it's a good question. to be completely honest, i don't really know. the only thing i can tell you the that i do not recommend them to buy the stock at that point

in time. buy once the short squeeze is behind us and on the pullback of the stock. >> pierre, you are remaining confident in their model i wonder when you hear ron baron come on our air and talk about a trillion in revenue in ten year, does that make sense to you? >> not really, because you have, like, with all due respect to ron, of course, within that vision, tesla could become a ride-sharing operation so they could be the number one car manufacturer and the number one ride sharing operation in the world. and so that's that about the stories i don't buy. i don't think tesla will ever be

able to catch up with uber and other ride sharing leaders very simply because once you have the ride sharing leader in a market, it's nearly impossible to beat that on top of that, i don't think tesla will have a technology, and nobody will have a technology in the possible future, that allows cars to drive by themselves without supervision and without being part of an existing fleet. so i have a view on that matter, which is a lot of self-driving technology will become available over the next decade, but the only place you're going to be able to do that for ride sharing are existing ride sharing netwo networks so on the last leg of this vision, i would disagree with the most bullish commentators on tesla. >> okay. first things first let's get through q1 pierre, than for the time. obviously your note got a lot of

attention today. >> thank you meantime, the earnings story in tech this morning is alphabet shares are lower after weaker than expected results. the company did break out revenue metrics for youtube and google cloud for the first time and stretch back a couple years for that two guests join us now mark, you raised your price target 50 bucks on alphabet after this, even though the report results themselves left some things to be desired why and how important is it that they broke out these segments now? >> i thought it was a real nice positive that they did that. look, they missed numbers. that explains the tradeoff stocks should trade off when that happens i think you'll sustain most of the year to date gains because the revenue growth is largely intact don't tell anybody this, but they've gone ten years in a row of 20% plus organic revenue

growth no other company except amazon has done that in financial history. the new disclosure, search revenue is growing stronger than everybody thought. the market sentiment would have been like it's a low growth business it's growing high teens, especially if you adjust for currency that's a positive. the growth rates for youtube as large as expected. the revenue was smaller but the growth rate is larger. and cloud is growing very close to those levels. what they told you about the growth of the different segments, that was a bullish take-away. the still negative area is those margins and it doesn't seem like this company will try to manage for stabilization. that's a negative, but the other things except that >> i could make an argument it would have been bet fer the search results had not been that good and cloud and youtube were stronger that's the future. you want to see a company show high confidence in more than one

trick and see the growth rates on a smaller business, an underdog in cloud, being much higher than azure and aws. why is that wrong? >> yeah. i think, you know, where we're at today is search is still a significant part of that core business, a majority of their revenues and will continue to be with a nice growth margin attached to it mark was saying as you see a solid growth in that core, that should give investors a lot of confidence going forward totally understand you want to see some of those new areas grow and we were slightly disappointed with where youtube came out we still very much like that core story google is still about search search has a long way to go in terms of how we use it today versus in the future >> the disclosures we got for google cloud and youtube ad revenue, was it enough for you or do you feel like a big piece of the picture is missing since we didn't get profits or breakdowns like the revenue sharing within youtube >> a great question. i think they need to provide a

little bit of view into the profitability of those two segments, cloud and youtube. we can just look at comps like what aws did in terms of its historical profit growth, profile of the last five years chances are a good thing for google shareholders is that google cloud should be at a scale level with it's no longer margin dilutive, but google, tell us the real numbers, help us out there they put things in context google cloud is going well, but there's a clear winner in cloud computing, and aws added more revenue this last year than microsoft azure or google cloud combined or just about the same amount no evidence google cloud is gaining share. youtube has a great growth profile going forward. it's undermonetized and still the future of television for most people on this planet i think it's great asset google is handing it well. >> mark, any clarity yet on the

sindar era he's been at google for a long time, now at alphabet. is it a coincidence they gave these metrics in his first earnings call with this much power? did they do it because the results are weak or because he doesn't want to be more transparent or challenge these businesses the grow? >> i think it's all of the above, actually. cloud was expected they've made a lot of announcements around that they want to be a serious player in cloud, they want to be top two if you want to do that with azure and aws, you have to do the same thing youtube was a bit of a surprise. the one thing we're noticing a lot is he's going at this wall breaking across the different product teams. we've seen some of that play out, activision, for example you bring the infrastructure for activision on the back end and youtube will become the streaming provider for these platforms. >> what was your guess on youtube's number

>> we had it about 20% higher than where it came in. we were expecting more traction on the direct response side but it's still very much a brand advertising platform and you have a lot of competition. super bowl ad pricing increase and remain high. a lot of the cord cutting, connected tv growing in that space. you think twitter is still playing a strong role and kind of monetizing -- >> did you hear anything between the lines that they would commit to buying big pieces of media rights the way we've talked about for years? >> yeah. i don't have a great sense of that we've seen it on the gaming side where they're making more recent strategic bets you see this battle emerging for user generated content, and i think we'll see much more there. one disclosure i'd to see is what they're paying for the talent >> mark, back to the idea of the emerging era here. google's other revenue, the fact that it was arguably a little weaker than expected disappointing. how would you expect that strategy within that segment to

play out and given the fact that he's now taking the reins of the overall company, do you think there are changes that are made there? >> i wouldn't expect any dramatic changes there if you look at the other segment, there's hardware in there and cloud. cloud was as expected, good growth rate, the right place for google to be that hardware gets a little lumpy in what investors need to know in 2018 the company did a series of launches -- they jammed all their launches into that fourth quarter. that created a tough comp for google hardware in this year, '19, where they had launches throughout the year. that's a small optical issue the hardware piece is still good the pieces together look attractive i thought the google disclosure to say $3 billion of that youtu youtube revenue, that is company with very diverse revenue streams. that's kwhauwhat you want as an

investor, holder in google, and they're giving it to you >> thanks for being here the nasdaq and s&p up better than 1 1/2 when we return, the latest on the coronavirus and its impact on tech ♪ ♪

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a second case of coronavirus outside china. the death total is at 420. meg tirrell has the latest >> public health experts are pointing to signs of potential broader spread outside of china including a case in south korea where the patient travelled from taiwan but didn't have a connection to china. they expect we could see cases like that in the united states one disease expert from johns hopkins said this morning he assumes containment efforts here will fail and we could see what he referred to as a mild pandemic the cdc noted e efforts to quarantine some from china and turn others away at the border are not expected to catch every single case of the coronavirus but a design to slow the virus' spread into the u.s. where a health system on high arert will be the next line of defense. a key tool will be diagnostic tests. cdc wants its test run around the country and hopes that samples won't have to be sent

back for tests one lab in china was running 5,000 tests a day. the sheer volume is a challenge but he also said the sensitivity of the test needs to be improved companies are jumping in to develop diagnostic tools, but those tests will also require fda's emergency use authorization. the w.h.o. warning today what it calls an infodemic, the spread of bad information it is working to amplify good information including partnering with companies like google for its alert system >> our next guest's company is helping airlines contain the coronavirus with its product the germ falcon. it's a robot designed to use uv light to kill viruses and bacteria inside of planes and prevent infectious diseases. the co-founder and president elliott joins us today >> thank you for having me >> you want to walk us through

how this works and is it being used in this particular case? >> yeah. we've seen situations like this with sars and mers, ebola, influenza. it ripples out to other industries the situation that we have here today is particularly scary because these germs can survive for 28 days, and when the cdc decided to start doing enhanced passenger screenings on inbound flights from china, we realized that if there's a positive test, something that sets off these alarms, there's no recourse for killing the germs that are left on the plane when these germs can survive for 28 days we need a way to disinfect the airplane because when people are traveling they're going all over the place. >> what's the efficacy how long does it take, and how much does it cost? >> we're using uvc lightings like they use in hospitals

we became familiar with this technology in hospitals. we really just reapplied it to the airline space. our unit fits like a puzzle piece in the airplane cabin and we're able to blast all the high-touch surfaces with strong doses of uvc light there are known dosages required to achieve 99.9%, 99.99% reductions of viruses, which is particularly what we're focused on on airplanes, and we know those doses are easily achievable with not only the germ falcon but also our other machi machines. >> elliott, back to this point you just made, because it's pretty shocking. a lot of people don't realize this there's no real infrastructure for infection prevention efforts on planes. given that fact, what are the conversations you're having with airlines right now are some of these potential customers buying your machinings and starting to deploy them? >> so right now we're deploying

our machines as a service for free because we want to be part of this emergency response effort this is all kind of a two-pronged pilot that we're doing because this is also a good opportunity for us to prove to the airlines that this can be a long-term solution so for even this influenza, flu season we've come to accept every year, this is a really good way to intervene and kind of disrupt the way these diseases spread by commercial airplane because the germs can survive -- influenza survives a few days on an airplane on surfaces outside the body, and coronavirus survives 28 days so it's really important that we are disinfecting these planes and making sure we can do our best to contain the way these diseases are spreading >> elliott, it looks like part of the argument you're making for cost effectiveness of this is the -- i believe you have nine cents on it i can see it in a time like this, it's easier to make the

argument, scan the plane using uv to get rid of these germs how about just the normal course of travel even when it's not flu season is that part of your calculation on costs that every single time the plane changes over one of these machines would have to scan it? >> in a perfect world, that's how we would like to see this done, but if we're on a once per day basis, that's a much better situation for passengers, like restaurants are required to maintain a certain level of hygiene. we want to change the perception so that is the perception when you board an airplane, there's a certain level of hygiene that's expected >> i'm assuming this gets done on the overnight maintenance, right? you can't do this between cycles >> so it depends how long the plane is on the ground we think that overnight routines is a perfect place to insert it. if someone were to use the motion sickness bag the airlines

provide, it may be worth running this up and down the aisle real quick because we don't know if that's motion sickness or coronavirus. >> elliott, thank you. interesting angle as industries of all kinds try to address this problem. >> thank you >> for more information on the coronavirus, do not miss a special report on the outbreak right here on cnbc that's tonight, 7:00 p.m. eastern. we're back in a moment

welcome back i'm sue herera the united nations says it is alarmed by the continued escalation of violence in syria. it says in two months more than 520,000 people have been displaced from their homes, the vast majority of whom are women and children >> military operations of all parties, including actions against and by designated

terrorist groups, must respect the rules and obligations of international humanitarian law, which include the protection of civilians and civilian objects >> three people are dead after a shooting broke out early this morning at a bar in lima, ohio police spent the morning analyzing the scene, looking for bullet casings and any other clues that might help with their investigation. according to the cdc, heart disease is the leading cause of death in the u.s., and in honor of american heart month, the american medical association is offering some tips to improve heart health they're pretty basic, but obviously we're not following them they include knowing your blood pressure, increasing your physical activity, maintaining a healthy weight, and cutting back on processed foods you are up to date that's the news update this hour back downtown to you, morgan >> always good tips. sue herera, thank you. european markets set to close in just a moment seema mody has the breakdown of today's action overseas. >> following a rebound overnight

in china, european stocks holding up well this tuesday glen corps up over 4%, announcing turnaround plans in africa and improving production of nickel and cobalt used in batteries. the "financial times" reported they were in talks to strike a long-term contract with tesla for cobalt shipments for its factory in shanghai. shares of bp are rallying after they lifted the dividend the stock is up about this%. meantime, european airlines, most of which have suspended flights to china dough doo, to the coronavirus are trading higher air fares from the u.s. to europe are up 2.4% this week compared to last week and europe to u.s. fairs up 3.8%. last week, the same week over week increase was about 1.7% unclear whether this is due to the virus or just the seasonality, but interesting metrics to watch back to you. >> all right, seema.

thank you. and we're getting a market flash on apple and its suppliers frank holland has that back at headquarters >> shares of apple supplier lumentum is above 20% on estimates and on optimism that full-scale production of apple products in china will resume as planned. other suppliers are trading higher as well, taiwan semiconductor, microchip, and micron about 3% higher back to you. >> the streets are pre-eminent analysts on tesla on the stock's incredible start to the year adam jonas is on the other side of this break. york state is buir the future of your business. with a nation-leading $150 billion commitment to infrastructure, we're creating state of the art, 21st century transportation hubs, constructing new bridges,

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waselcome back to "squawk alley. since january 1st, no one has gained more wealth than elon musk >> he's getting richer faster than any billionaire in the world. he owns 19% of tesla's stock, and the market cap of the company has gone up by about $86 billion, so his total net worth is up $17 billion just since january 1st. now, that includes $4.6 billion he made just overnight, which brings his total net worth to $45 billion. he's made a half a billion dollars a day or $20 million an

hour just this year. that, by the way, is more than any other billionaire in the world, jeff bezos only up about $9 billion this year, bill gates only up about $2 billion put another way, elon musk has added rupert murdoch to his wealth this year, so what would tesla have to do for musk to pass bezos as the richest man in the world? musk is currently ranked about 20 for him to pass $125 billion, tesla's stock would have to hit 3,665. by the way, if he hit that share price, as well as a profit target of $14 billion a year, musk would get an additional $50 billion bonus. that would put his total at $175 billion, which would make him the richest man ever guy, back to you >> one more reason to keep watching this intense surge in the stock. robert frank, thank you.

>> thank you guys. our next guest recently downgraded tesla with a price target of $360 saying a, quote, aggressive blue-sky scenario only takes the stock to around $400 a share, a more than 50% cut from where it trades today tesla is also a key player in the autonomous vehicle race with competition from the likes of gm, uber, and more joining us now here at post 9 to break this down is morgan stanley's adam jonas great to have you. >> thanks for having me. i will correct you the blue-sky scenario was an extra $400 million on top of our $er 650 bull k if you want to dream big, tesla has the largest market of any company. a lot of room to dream >> i want to dig into that and into the move we've seen in tesla. first to the fact you've been writing extensively about autonomous vehicles and the future of mobility what does this landscape look like how does tesla fit in with other names including alphabet, which reported yesterday >> we've been writing about

autonomous cars for about seven years across about ten sectors the technology is real it's a noble cause there are hundreds of companies if not more allocating many tens of billions of capital to solving this problem of autonomy that said, when we at morgan stanley talk to the scientific and tech communities, it is replacing a human driver -- that's been described as the hardest technological challenge humanity has ever attempted. and the lawyers we talk to say it is the most complicated moral and legal and ethical challenge that any lawyer has ever addressed. the combination of those two things leaves us optimistic of the long-term future but telling investors keep your expectations under control for the next ten years. we think this is way beyond 2030 when you see the inflection. >> you think it's beyond mapping the genome, for example? >> i'm not a scientist, but this is how it's been described to me it's been described as the

closest approach to general a.i. sorry if i'm sounding ignorant to real tech heads out there that know better, but we're trying to connect the dots here, carl >> when you talk about autonomous vehicles hitting the road in a mass level, the idea of robo taxi fleetings, when does that become realized? what's the date? >> we work across seven teams in morgan stanley, 18 analysts. by 2030 our forecast at level five autonomy miles penetration, that's level five no steering wheel, is sub 0.5% when you talk to some people, they say that's almost nothing, that's zero. hold on a second uber a couple years ago was 0.5% of u.s. miles traveled 1 out of 200 miles is a lot of miles. that could be one out of 15 miles in the city. even the small numbers are incredibly ambitious we don't get into the double-digit penetration on

miles traveled until beyond ta whereas we had an analyst at the beginning of the show with a very different price target, $800, and it's trading near $900 what would it take for you to be wrong just on the conservative side with this i ask this from the context of having covered apple for a long time everybody expected them to come out with a phone but nobody expected it to be the most successful consumer product arguably of all time >> sure. >> what would it take for tesla to do that well and prove you wrong? >> there's different scenarios we explored in our research. before i answer, let me step back and say if thomas edison and henry ford made a baby, that baby would be called elon musk, okay he's absolutely incredible what he's done using his enthusiasm to really change the world, if we're being honest

what the recommendation on the stock is a different thing we think what's in the price right now is something approach 4g million units of annual volume by 2030 at a 15% ebitda margin so at a level of volume of 40%, maybe approaching 50% of toyota, okay but that's if you look at it as an auto company. if what's happening now in the market is essentially by doing a deal with china to bring in some capital and to kind of draw a line under the distress argument, what tesla is throwing a stick of dynamite at a force store and it's led to a chain reaction, auto analysts, buy and sell side, are passing the stock to tech analysts from a tech perspective, they aren't just thinking about numbers of units sold times price or margin. they're thinking of users, recurring revenue, do they become a battery supplier to the world's auto companies, right. when you start doing that, 10%

of all the cars on the earth and they can make 10 bucks a month, that's $400. watch april 4th where they might unveil a terra watt hour of capacity, you can add and get into the multithousand dollar price targets. >> isn't that handoff ineffortable for gm and others >> when we talk to our clients, the discussion aren't with auto analysts anymore they're with ech it's not just tech tesla has monopolized publicly traded esg and tech, so the bigger story, if i can leave you with this, i expect you'll be discussing this and i'm delighted that jim cramer talked about this, too, the bigger story here, morgan, is this is climate change it's tapped into something retail and institutional at both those level where is elon musk and his kind of esg portfolio is seen as an incredibly noble

value creative way of attacking esg challenges, particularly climate change >> i get all of that i can appreciate that argument i can appreciate the fact there is this debate out there about whether this is tech stock versus something else. there's so much competition poised to come online when it comes to electric vehicles in the next couple years. you mentioned four different auto companies super bowl ad just for the super bowl. what does that look like when there's no longer an esg monopoly >> an inconvenient truth, talking to tech folks, where tesla might look reasonably valued, we find ourselves reminding them, there's 15 million or 20 million human beings making cars globally. most of those workers are unionized. we're having this discussion -- you know, before you declare

tesla the winner, it's worth reminding everybody that penetration today february 4th is only 2% tesla has a quarter of that. taking nothing away from elon and tesla, they're by far the best, right, but 2% penetration, 20 million jobs, governments, and you have china, which is let's say -- has a significant vote on the direction of tesla's chairs over the next few years, leave it at that, this has the potential to be complicated still having the dream of the multi thousand dollar -- >> the president said we have to protect our geniuses, referring to musk. china has leverage over how musk fares. >> glad you brought that up. tesla is seen as important to the united states from a national security perspective and environmental security he's important to the people's republic of china from a, hey, show us the way, transfer your tech and i.p. and let's do business together. and he's clearly important to

the tech community, which is taking over the stock, right and he's very important to the esg and retail esg community those four things -- >> he's at the center of everything >> he's the chosen one, carl >> he's ne-yo. >> okay. there you go are you referring to a chinese auto stock >> he's from "the matrix," knows kung fu, but at the center of these shifts >> monopolizes the discussion. i'll be back at the stock exchange tonight with general motors gm has a capital markets day tomorrow the discussion will be dominated by tesla and even auto companies massively respect musk and the product. they do. back to more broad di what autonomous looks like, what this future looks like, especially if you're not getting autonomous vehicles in a significant, meaningful way until potentially 2030 >> that's -- >> where are we seeing it?

we're starting to see the adoption experimentally when it comes to things like trucking, rail, some of these other areas. faa publishing its latest proposal on package delivery by drone. what is what does it look like >> you need a lot of trial and error, fail fast you'll see cars going up and down the streets without left-hand turns and as the algorithm learns and communicates, it can make a left-hand turn it might make a city council or mta to make it happen. this is of a very important nature and there's no substituts you'll see pockets of geo application bus to fully remove driver en masse is something very different one client said waymo, the tech is ready, they just don't want to kill anyone

my response to that is you kint of can't have it both ways you can't completely eliminate the risk of those kinds of accidents. >> with tesla at $900 a share, taking it back to tesla specifically, i think back to august 2018 and elon musk wanting to take this thing private. he kind of dodged the bullet there, didn't he is there any argument left give than this is a valuation mover for tesla? and yes, they've done some things operationally which are great, but he would have missed out on a lot shareholders would have missed out on a lot if he had taken it private. >> nooefr i seew year's eve i s musk a text message, many people didn't realize how close they were to success before they gave up i think all of us can thank him for not giving up. if you look at the path and the arc of any entrepreneur's career, overen the most

successful entrepreneur, stooefr job steve job, et cetera, there were moments they almost lost it. perhaps you can chalk that up to look in the mirror, take the advice of your family, the board, and if you want to decarbonize the worrell, i can't blow up in the process thankfully it looks like today he rescued himself in time. >> last time you were on we talked about your bear case at the time why have i would you know, from an analyst model standpoint >> yes >> your answer was it's the leverage >> correct >> has that been answered given the positive fly wheel effects of having the capital markets appreciate >> since we were last on the program, our current bear case is $115, which might be the new $10. extremely low, hard to fathom level, but we had to throw that out there to cover -- while their leverage is small relative to the market cap right now,

it's still significant relative to their revenues. if there is, using elon's terms, a force majeure or something, if a china six keeps creating liquidity, if there's an economic event on and on, you know, this is a high fixed cost, high operating leverage with reasonable financial leverage relative to the size of the business operation so we can debate till the cows come home whether 115 is the right case or three months ago price was the bear case. as the stock goes up, it tends to go up, tends to go up and you have a circle and we suspect, although clearly remote in the conversation now, that if we had a scenario that brought the stock from $900 to $500, people would be talking about $300, then people would be talking about $200 that's part of the psychology and the leverage of the market working both ways. >> do you think there's an offering in the next 12 months >> no comment. but we have modeled roughly a $3

billion equity raise as a kind of starting point, something they could do, would be nice to have but the company has denied a way to do it >> crazy question, but i ask you -- >> uh-oh >> -- because you watch the sector as closely as i do. do you think any of the achievements or developments that are happening at elon musk's other company, spacespac, are exhibiting to some of the positive momentum in tesla right now? >> first, not a crazy question we've been writing for years about the relationship between spacex, arguably the most important company in the private space industry, and certainly has the president and vice president's attention and nasa and tesla. a few years ago, when tesla's financial outlook looked shakier, we thought there might have been room for more imminent collaboration. in this environment tesla can escape velocity, a space term, morgan >> thanks for that >> then perhaps that relationship is more

opportunistic. we were kind of laughed at on the last tesla call when we asked elon if cars could be fitted with antennas essentially or consoles that could be come pat blg wiable with a star link took the question seriously and then brushed me aside. we think there's something there, but we think there is something there. and no it is not a crazy concept whatsoever stay tuned potentially. >> when you look at the price action here, and you look at -- let's just take the market today. up almost 500 on the dow, 1.5% oil can barely get above 50. is this a share loss story for fossil fuel? can we bake that in? >> i have to go back to cramer. >> he has been preaching it. >> he's right on the bigger story is the flipping off of liquid fuels into renewable. and the tens and tens if not hundreds of trillions of dollars

that's going to follow in that wake even if tesla were to be flat at $900 or just cut it in half and it could justify a $500 target the things it needs to do to grow into the market cap will bring multitrillion dollar economies with it. right? yeah, we think this is the end of the ice age, the end of the internal combustion engine age we are just beginning -- i was saying before the program, these are historic times and working with experts on this >> adam jonas, thank you for joining us >> couple days. >> sounds good. >> a reminder as we head to break. we know you can't get enough "squawk alley. we have a solution watch us any time on the go on the cbs app. download it today. stay with us (soft music)

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illinois is the 11th state to legalize recreational marijuana. but are they doing it better than everyone else jane explains from chicago. >> that's the hope we are at the mission dispensary on chicago's south side. we have brand-new numbers. over $39 million -- that is the sale of adult-use marijuana, legal, for the very first month in illinois, well ahead of expectations and more than 20% of that came from tourists. we also went to the rise dispensary owned by green thumb industries some all illinois cannabis 2.0

because of their clear rules is illinois going to save legal cannabis >> that's not our job. but i will say that the industry here in illinois -- and remember, all of the manufacturers or the growers, the dispensaries, the people who work in the industry for illinois, are in illinois. there is a lot of demand out there. there is not yet enough supply to meet the demand and again, because we are protecting our medical cannabis patients out there -- we want to make sure they are served first -- i think it will be a healthy market i think people will be running profitable dispensaries, grow facilities it is important to me that frankly we are creating new small businesses, new millionaires, in neighborhoods where people have been so left out for so long, in particularly the victims of the war on cannabis i think we are turning that around with our social equity

focus. >> the governor is more concerned with social equity and social justice and safety than he is with taxes, which is -- because taxes are high, they can be over 40% in chicago that's on top of high prices because of lack of supplies, which should start to ease later this year. medical marijuana only taxed at 1% they are already seeing recreational sales outpace medical. that trend should continue back to you. >> jane, i am curious, as we see more and more states and more and more municipalities legalize marijuana for recreational use, has the technology kept up in terms of being able to enforce things like ingesting and driving. no and this is something -- it is very difficult to determine what is under the influence a officer in general has to determine by his or her

experience tests are coming a. breathalizer is supposed to hit the market sometime later this year the biggest thing coming up with a payment system so you can move away from cash generally what that meant is moving your debit card onto a separate card that you can use in the dispensaries. >> what a change from some of the other action we have seen in states like oregon and california great story. we are up 472. let's get to the judge. >> thanks. i'm scott wapner front and center, the stock surge. your money having its best day since october. the s&p not that far away from another new record high. it's 12:00 noon, and this is the "halftime report." a big rally on the street. the stocks that are being snapped up tesla shares in ludicrous mode up more than 110% this year. what is really driving the gains? what is it signature about this market. disney reports after the

bell the traders take