year at least before things get close to back? >> i think so. i think it's going to be a year. a lot of these countries aring look at extending the lockdowns. depends on where you are varies from one country to another. at least a year. >> mark, thank you i'm glad we finally got you. it was short because we had issues getting you on the phone. thank you. >> thank you >> we'll say good-bye until next week futures are up sharply have a good weekend as you can have under the current circumstances. hope springs eternal good luck. ♪ >> good friday morning, welcome to "squawk on the street," i'm carl quintanilla with david faber and sara eisen cramer has the morning off big bounce as the market digests this antidotal report on rem

white hou on remdesivir and looking past china's first gdp contraction in 40 years oil below 18 is something to watch. that report out of stat news reflects how much hope there is, whether it's remdesivir or something else for an effective treatment going into the fall. >> it does it may also reflect thin trading having spoken to a number of people this morning who are wondering whether or not you can have big moves in the market with just a billion dollars of futures being bought, which may seem like a lot, but is not. because, you know, you have a lot of fund managers who tighten risk, they took down their net exposure, perhaps they didn't kel quite a sell quite as much it's unclear how much buying power is needed to move the market in a significant way. remdesivir itself is important we're all hopeful that it is going to actually have an impact

on the outcome of the disease for those who get very sick and end up in the hospital but it is not going to be what we call a chain terminator it is not something that will stop the transmission of the virus. it's an infused medicine in the hospital at this point it's not clear whether it would work earlier in the disease, whether it would have the same impact that we hope we will eventually get from oral antivirals that can be taken from people at home who get the first symptoms of covid-19 that's much more important that would be a chain terminator, that would have an impact on the economic impact of the disease. this, sarah, , impacts the outc but it won't stop people from the chain of behavior. >> this is administered through an iv for patients we need a pill as you say, that you can take at

home to keep you out of the hospital in the first place. it is worth noting the encouraging results from gilead and that stat news 113 out of 125 patients in critical care in chicago had severe disease, they were all treated with remdesivir. they had two die the pros are most of them recovered after that many are discharged at six days, a few at ten days. that is the good news. it does help the chances for remdesivir being the first fda drug that is approved. though there's not the statistical evidence you would get in a control group that's why we're calling it antidotal to prove that, you know, that this would have happened with or without the drug this happened because of the drug you know, take it with a grain of salt, but very helpful. it also shows that, you know, the market moves people spent much of the week wondering why is the market continuing to be so resilient and continuing to climb when

another more than 5 million people filed for unemployment claims when the economic data has gone from bad to god awful numbers that we've never seen before record decline in retail sales, industrial production. new york manufacturing we all got it this week. why is the market hanging in there? the health data. these trial results, the news, the flattening of the infection curve. the fewer hospitalizations and hot spots like new york, that's moving the market. whether that dynamic continues or not, that is what leads investors to look over to the other side that, i would say, david and carl, and a whole lot of stimulus both from the fiscal authorities and from the federal reserve, which continue to stabilize the all-important credit markets and the overall bond market. the muni market not all the optimism in the market is reflected in the bond market >> absolutely. ten-year yields have come down

14 basis points in three days, this morning barely up there is disparity between the equity response and the bond market response. sara, to your point. i love tom lee's note this morning, never would i have imagined 5 million jobs lost would lead to an uptick. the market seems out of sync with what we know lays ahead but it suggests the recovery is going to be much stronger than people expect. david, from a trading perspective. that's why you have names like amazon, netflix and peloton down in the premarket because there will be a knee jerk response to unwind the stay-at-home basket which has been a source of strength >> that's right. this new nifty fifty, microsoft a ben fieficiary of this rally the secular growth names are the focus in terms of buying over

time it would seem, carl i don't have a conversation that doesn't begin or end with i don't understand the stock market the because, you'll spend a lot of time talking to people who are running businesses or focused on analyzing them, and they don't seem to think things are going to be good for some time, there's a question in terms of our recovery, getting back to work, how stuttered that will be. how difficult that will be when we will really return to behaviors more akin to what we saw prior to the spread of this disease around our country yet people throw their hands up and say, yeah -- you mentioned this -- i don't fully understand the stock market at this point >> you know what that reminds me of >> what? >> it reminds me of when we were in this with china remember in the beginning of the year, and china got locked off from the rest of the world and, yes, the chinese market was closed for the lunar new year,

then it we openreopened, had a fall and had a resilience where it was at multi-year highs, people were saying it must be china buying it. but others looked at it saying they were flattening the curve, significantly flattening this virus and looking out to the other end. i'm not sure china is the best correlation since there are concerns about the data with wuhan adding the number of deaths by 50%, saying those were not counted. i will say you do believe companies like starbucks, like nike, like l'oreal overnight today, like png, which is talking about china right now, talking about a recovery there after the economy was shut down we got those gdp figures, 6.8% decline, worse than expected in the first contraction for china decades. yet there's continued talk of recovery there and that -- i wonder if the

market is looking through to make a comparison to what could happen here if we get enough treatment and enough flattening of curves to get people back out into the economy again not saying that there's necessarily a v baked in, but i do remember that action in china. it was optimistic. >> yeah. well, you may be right, sara there's got to be some explanation. it doesn't take a great deal of buying power in this market to move things higher initially, but we are looking for a significant up open. as we said at the open of our broadcast, in part because of what seemed to be positive reactions to the gilead drug, remdesivir, which is being used in acutely ill patients in the hospital let's get to meg tirrell and get more on that part of the story meg? >> hi, david i think you couched it well there. these are not clinical trial

data these are not results from a clinical trial this is a glimpse into what one hospital said they were seeing in part of a clinical trial that they're participating in with gilead's drug remdesivir this is from stat news, which focuses on medical news. they got a video from the university of chicago, which was communicating to faculty members what they were seeing in this clinical trial they enrolled 125 patients, 113 of whom were severe. what they said is they were seeing rapid recoveries in fever and respiratory symptoms, seeing that nearly all of the patients were discharged in less than a week and they observed two deaths among those patients that they talked about now, we need to give the caveat that this is not controlled clinical trial data, and there is a lot of skepticism around how much you can take away from what is sort of observational. we are waiting for these trials from both gilead and the nih, the first results of which we should see later this month from

gilead's trial in severe patients that nih trial is the gold standard of efficacy data that is often needed before approval of a drug. the wall street reactions coming in this morning among biotech analysts really mixed. citi calling it a ray of hope. jpmorgan saying directionally positive le leerink saying this is antidotal and baird calls this exuberance out of control on remdesivir so we'll only have answers as we see the clinical trial data come out. but clearly a lot of people hoping that this means we have a drug that works. david? >> yeah, meg, i was making the point earlier this is not a chain term nateinator it's not taken early in the cycle of the virus to keep people home and make sure people are not getting in the hospital and making sure they are cured

quickly, or is there a possibility this could be used in this fashion? right now i know it's infused in the hospital but if it's successful, will they try to use it and change the formulation and use it earlier in the progression >> because of what you mentioned, it's an i v drugging right now it is used in the hospital setting that is the way drug development usually works. you are testing things in the most severe patients first and you move backwards to less severe courses of the disease. gilead is evaluating other ways of administering the drug, but that will take some time what we might see before that is efforts from other countries and researchers into small molecule drugs that can be given as pills. that's months away but pfizer is searching for antiviral drugs. david lowe at columbia is looking in this. so we could see those come from other places >> meg, the other question in talking to medical sources about

this drug is we don't know the side effects do you hear anything antidotally about the side effects being so severe that it may not be used as widespread as hoped >> certainly there are concerns about the safety of this drug. they have tested it in ebola as well some of the side effects are known. people do look for effects on kidney toxicity and liver toxicity, that will need to be better understood in the course of clinical trials to understand how widely this could be administered but drugs are not benign, it's important to remember that there could be a dangers to using them widely as well >> all right, meg. we'll watch it closely something we'll talk about all day. meg tirrell on this gilead news

regarding remdesivir a lot of news to get to. we'll get to procter interesting dynamics regarding the consumer, health care and home care. goldman with their note on apple as they go to sell and a tget ar of 233 we're back in a minute rking day. at&t is here. providing support with advanced services for first responders. and connected temporary hospitals, mobile testing sites and emergency management centers. because until their job is done, it is essential that we all have their backs. it's what we've always done. it's what we'll always do. when yowhat do you see?itical issues facing our world, we see a billion more people breathing free. we see access to fresh food being the global norm, not the exception. we see homes staying cooler, without the planet getting warmer.

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>> futures pointing sharply higher with the dow up 650 in the early action boeing is helping out announcing it will resume commercial airplane production in washington state next week the stock up this morning on the news erasing a lot of its losses that we had so far this week. phil lebeau in chicago with the latest phil >> remember those losses were because of a number of questions that have beenhanging over thi company over the last week and a half, particularly wall street wondering when will you have a number of things taken care of including a resumption of production that has been taken off the table with this announcement that it will begin a staggered resumption of commercial airplane production in the seattle area starting on monday, ramping up throughout the week this is only on wide bodies. they're got doing work on the 737 max. that remains grounded. they have not woken up that assembly line to the degree that they will eventually have to as you look at boeing. you have this issue that's been

answered that's why the stock is moving higher three other questions out there that we may get some clues to over the next week, week and a half, two weeks. one of them, what happens can the production level and staffing levels. does boeing have to bring down its wide body production rate? does it have to cut staffing for the company by as much as 10% as many people believe they ultimately will? also watches with the treasury loans and accessing loans in the private market a lot of that decision depends on what the terms are in terms of what treasury says, if you're borrowing money from us, this is attached to that and the 737 max certification, boeing continues to maintain it expects to have the plane ungrounded by mid year all of those are the issues that people are focused on now. the backlog tops about 5,000 airplanes at this point. as you look at shares of boeing, this is production return and just a small part of getting the company back, the commercial

business back. look at all the aerospace suppliers, they're moving higher on this news people are saying when will boeing and airbus finally get production moving again? >> phil, i'll ask you to reflect on a couple things in the auto business three things really. one, this ford news, the q1 profit guide for looking at a $2 billion loss tesla up nine days in a row and eurozone auto registrations down 52 in march. what do we make of this conflicting range of stories first with ford, and it ties in to what we're seeing out of europe ford sales under pressure over there. not a surprise on ford they did a preannouncement a week ago, i believe it was, at the time they pretty much said the first quarter will be a mess the $2 billion loss, i don't think that's coming as a surprise to anyone europe, that's what we expected in terms of registrations, going

to be down between 50% and 60% in terms of tesla, look, there's optimism that tesla, because of its plant in china, carl, will be able to come out of this coronavirus downturn, if you will, in terms of global auto demand and be in pretty decent shape in china if you buy into that, you buy into the tesla rally right now >> it's been remarkable to watch. we'll come back to you later on. we'll take a quick break here. as we get set for the opening bell in ten minutes. don't go away.

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futures are strong here really reflecting three stories, the report on remdesivir, boeing's attempts to reopen at the beginning of the month and the guidelines from the white usfor states to reopen we'll see how the opening bell looks in just a few moments.

welcome back to "squawk on the street" as we get you ready for an opening bell for the last trading session of this week we may be down as little as 12% on the year when we see the open this morning but, carl, it was interesting, when you asked phil about tesla, i took a quick look at the market cap of that company, which is up 78% this year. and despite the fact that the s&p is only down 12%, we do have a lot of stocks that have been far more dislocated than that. tesla's market cap, about 1$138 billion. always helps to put it in perspective. forget the comparisons to ford, gm tesla is close in market cap now to chevron that does put it in perspective. chevron, 149 billion tesla about 138 billion. with wti poised to be down overo

keep a close eye on those energy companies. >> brian sullivan have been making the point that we have a may expiration coming up below 18 gets everyone's attention. i saw that earlier in the week, sara, we had another price target on tesla, 846 the street has not turned on it. we'll get to goldman's call on apple, which is calling for a much deeper reduction in iphone demand for the current quarter than the street does expect. >> yeah, certainly i was just looking at apple, and the tesla point. microsoft, apple, amazon, facebook continue to make up such a big concentration in the

s&p 500 and in terms of the gains, also speaks to the nasdaq out performance so far this week i think jim cramer has been making the point all week long that it is big stocks that are thought to be fine through this crisis and will do okay potentially even better during this crisis. i want to hit p&g. the consumer giant reported earnings this morning. sales growth very strong the best in a decade that was expected. 6% organic revenue growth. it speaks to what p&g makes, charmin toilet paper, vick's vaporub, crest toothpaste, this is what americans and others around the world have been stocking up on that drove the results even with weakness in other parts of the business like beauty and grooming, which we don't stock up on during this pandemic, i was paying attention to what p&g said about china

the business got hit hard during the quarter with china closed. here's what the ceo and executives are saying just now on the call about the reopening. liste listen >> through the incredible efforts of our organization we did much better than we were expecting in greater china down only 8%, excluding retail we saw a strong lift in our categories in e-commerce to make up a portion of sales lost in closed physical stores we quickly restored production capability, built shares and are now operating at close to full strength >> operating close to full strength it's a similar message we heard from other multinationals operating in china one potential disappointment, the strong dollar continues to hurt this company which gets most of its sales out of the united states. it chips into those earnings we've seen the dollar reach high levels that's been painful.

also, as far as the forecast, they kept overall guidance but did decrease the organic revenue growth i think one question investors have is how does p&g do during a recession? on one hand it's a staple that should bode well people need their basics and they're stocking up. on the other hand, if they have premium products and premium brands if there's a lot of economic pain out there, job losses, income declines can those brands remain resilient will people be willing to pay more than for just a generic brand for their basics, their staples. so far so good for p&g the reason the stock is not moving much is this has been an out-performer. barely down for the year and over the last three months the company raised its dividend in a sign of strength and a sign it's doing better than most other companies out there now.

>> yeah. stock up for the year 14 plus percent over the last 12 months. questions also about is it sustainable, these behavioral changes? will people continue to buy more cleaning products even after the virus leaves us, which, of course, we hope is as soon as possible there is the opening bell, carl. getting ready for trading on what has been an eventful week seems like weeks ago we heard from the banks which have been a poor performer this week, but everything is turning green this morning on hopes of the drug we discussed from gilead, the reopening plan from the federal government, giving a lot of that responsibility to the states, carl, as they plan individually when to open and how to hit their various phases ones, two, and three >> yeah. we'll talk to the labor secretary in a little bit about that and the president reportedly telling governors that they will call the shots.

david, you mentioned earnings. next week's universe of earnings will get more interesting as we get coke, ibm, netflix and chipotle but the credit card companies will be interesting. we'll get amex, discover we'll see if those reserves have different characteristics from the companies that work the credit card business >> we may have gotten a preview when we saw wells fargo or bank of america, citi giving their significant presence in credit cards as well. but you're right, that's a key barometer in terms of what we're seeing from the consumer at this point. it's fairly early on, even though we have gotten these enormous 22 million people applying for unemployment benefits over the last number of weeks. carl, it may be somewhat early they'll try to anticipate what their roles will look like and what the bad debt will look

like >> yeah. we keep mentioning, you know, where households will be likely to trim expenses down the road you talk about premium products at procter today, benchmark, a firm we don't talk about a lot, does cut netflix to sell. they cite surveys suggesting that streaming services are among the first household budget items to be cut. oppenheimer does cut our own parent comcast, to market perform saying that our leverage, our exposure to legacy content is among the highest in the universe >> speaking of lookingout into the future, jeffries upgraded tjx, which was interesting, because all the retailers are in a world of pain, especially ones like tjx which don't have a huge online business. jeffries says upgrade to buy they like the secular share

gaining that tj maxx has had over the years versus department stores, which are going to be hurting. they say tj maxx and marshalls should be a winner even after this pandemic. they say that the covid-19 should drive more rapid adoption of the off-price model internationally. so the price points on the merchandise, which is lower than your usual department stores and other brands will help in a world where we emerge from covid-19 the path forward as we're calling it here at cnbc. >> we continue to have a lot of companies trying to raise money. those in particularly vulnerable areas. i think they mentioned earlier amc, which the theater company we've been watching closely on "squawk box. becky mentioned it they offered $5 billion in firs lien notes the market cap of the company is

far below the 500 million they're looking to raise first lien would give whomever buys these notes, we don't know what the coupon on them, it would be, the right to be very high up in the chain in terms of bankruptcy if that were to happen that's not a word foreign to amc. we have nordstrom and retail under pressure, but it is doing significant liquidity measures, suspending its dividend, announcing the amendment of a 8$800 million revolving line of credit it closed on a debt offering of 600 million, 8.75% is the coupon there, saying this will add flexibility and liquidity for the company at this point. s they did draw down 800 million on the revolving line of credit last year and they have the 600 million coming in from the debt offering shake shack says they will hit the market from time to time up

to 75 million in terms of raising stock. or i should say at market equity program is what they call it selling stock to raise money 75 million there sara, i'm watching these crazy moves in the mall operators. yesterday simon property group got crushed. today it's up a great deal same as some of these others as people try to understand what these retail eers and their failure to pay rent will mean for the mall operators, the debt there. the move in the stock prices has been dramatic day-to-day >> well, there was a report yesterday that neiman marcus failed to make a rent payment. that was a reminder that that's what's happening out there as traffic goes to zero and these stores close longer-term questions, james go gorman talking about yesterday

whether they need that commercial real estate, were wheth whether it changes the business model with so many people now working at home, doing it effectively and relatively smoothly that's been a continued theme here in the function of markets as well. as for the debt opening, a lot of it has to do with the fed yes, the coupon rates are there for carnival, but the federal intervened into the corporate bond market for the first time and below investment grade rating junk debt it's something that will continue to be a discussion. i've seen a lot of fed criticism starting to heat up out there. we talked to philly fed president patrick harker yesterday on "closing bell" and asked if they were rewarding companies who have taken on too much debt and risky behavior by

buying their debt. they continue to say it's not their fault that we're in this pandemic that has been the line that we get from both fiscal and monetary authorities, nobody would have anticipated this. no one could have run their business for this. a lot of these companies that bought their debt only recently got downgraded to junk status because of what has happened with covid-19. here's what else president harker out of the philly fed said about the economy >> everybody likes letters, greek letters, but i graveave up i think we're down to a period where it's pretty bad, it's pretty bad right now your hearts go out to the people across the country we will climb out of it. it won't be a sudden bounce back it doesn't make sense to me. there will be certain industries like travel and tourism and hospitality that will take some time to recover.

>> the fed president on the shape of the recovery, which everyone is trying to figure out. is it a v, a w, a u? none of the above? one thing that was encouraging that he said is that a lot of the job losses we see, those millions of initial jobless claims he says in his gut will come back quickly, like construction when the economy opens up which is why the opening up that president trump laid out is so important and positive for the market. you know, travel, leisure, hospitality could take longer. >> let's hope so the cumulative claims in the last four weeks matches the work force of 23 entire states according to "the times" this morning, citing bls data the white house, of course, did unveil guidelines for a phased reopening of the economy yesterday. and joining us from washington, d.c. is the u.s. labor

secretary, eugene scalia thanks for the time. good to see you. >> good to be with you >> we've been talking about the prospect of opening for several weeks obviously. and part of the thinking has been areas where there's dense gatherings, movie theaters, churches, sports venues would come last. they're now in phase one can you talk about what kind of thinking went behind that? >> well, this, as the president laid out yesterday, and as dr. fauci and dr. birks did as well is the product of very careful consideration by the medical advisers to the president and i think reflects a thoughtful and appropriately cautious approach, but one which recognizes that some states very soon if not now are in position to reopen. with respect to the public

places that you're mentioning, it's not going to be wide open right away that's phase three but in consultation with the experts, we're finding that in a number of states -- they'll make those decisions themselves, but in a number of states, they'll begin this reopening soon. we need to continue to be disciplined about the guidance for public health that's laid out in this document we have to be disciplined. but this is a sign we're turning the corner and there's light at the end of the tunnel. >> how much did testing play in the creation of these guidelines virginia has 8.5 million people, tests so far, 50,000 to what degree will testing be a true barometer to the degree in which they can open? >> it's in the document itself the test results, symptoms, cases are going to be a -- an important measure of whether states and the judgment of the

governors are ready to pass through another gate that's something that will be looked at. when i look at this from an economic perspective, i think the announcement yesterday is very good news it shows a thoughtful, measured approach but one which shows the way out of this. we heard from some governors they're prepared to go there you were talking a moment ago about the unemployment numbers we released yesterday. the sacrifice that american workers are making is tough. it's hard to see but we're seeing results we're grateful for the discipline we realize there needs to be more, but we're seeing a way out of this, a way forward i think that's a reason for optimism >> you didn't lay this out, but is there an expectation of which states you would imagine would be most aggressive here?

i don't know if that's part of the matrix or if you're leaving to governors you must have a sense of which governors are champing at the bit. >> i don't think we're looking for people to be overly aggressive one of the morimportant messages yesterday, this is a thoughtful data-driven scientifically informed approach. different governors will make different decisions. i don't want to preannounce that for them i think some governors have begun to signal they're close, they can enter into phase one. they'll make those decisions and move forward it's good news for the national economy as a whole that we have this road map now. it seems to be reflected in the stock market this morning. >> secretary scalia, it's sara eisen. there's so many americans now risking their lives to take care of critically ill patients in hospitals, to make sure we have groceries on our shelves, to make sure the streets are safe what at the department of labor

are you doing to protect them and make sure their employers follow the cdc guidelines and provide them with the necessary equipment they need? >> sarah, as you say, this is a war of sorts, and the front line in this war is different than in the past it includes our health care workers who are doing amazing things now and are making sacrifices and taking some risks. getting equipment to them has been important that's something the president moved on quickly we have been working with the cdc to make sure that the right information, the right guidance is provided to those companies so that they can take care of their workers. we are also receiving and looking into complaints when we have them. something i have emphasized and will continue to emphasize is workers who have concerns, have a right to raise them with their

company. if they feel they have been discriminatedagainst because they raised health concerns, we at the labor department want to know about that. >> why have you not been more aggressive to publicize those complaints, issue citations in people are wondering why you're not using osha to do more to protect workers, and why we're starting to see things like strikes and more publicity around amazon warehouse workers and other sort of complaints by workers that they're not getting what they need >> we are doing more >> osha was putting out guidance on precautions to take in the workplace as early as january. i think january 22nd was the first time they began putting out guidance they've been doing that regularly. they've also taken steps to help free up the supply of respirators to health care workers. they are receiving complaints. it's not osha's practice to announce complaints when they're received, but we're receiving them we're looking into them.

we're contacting companies where there's concerns we're seeing results they're very much engaged now and i'm in regular communication with them about the steps being taken both working with cdc to ensure worker safety and protect their ability to step forward if they have concerns >> secretary scalia, given the unprecedented number of people who find themselves out of work, it's no surprise that states may be overwhelmed with phone calls, applications many have turned to the federal government to say, hey, help us out on the administration of these benefits are you doing that are you telling them it's your problem to deal with >> we're working so closely with the states when we look for bright spots, good news, one is certainly all of the quick steps the president and congress took last month, three major pieces of legislation in three weeks including that unprecedented

unemployment insurance payment that was put into the c.a.r.e.s. act. $600 a week additional on top of what the states provide. unemployment insurance is a state-run system but we have a billion dollars we're giving out to help them with those systems. i think two-thirds of the states are making those payments, that additional $600. we're in constant contact with them even providing extra resources to help them with their computer systems which are in some cases decades old, we're giving them additional resources. we want to help them succeed in getting these payments out to workers. something else important to us is the paycheck protection program which was another valuable part of the c.a.r.e.s. act. it kept workers on payroll it kept small businesses up. sadly that's out of funds. i'm sad to hear that i thought it was such a good thing for workers. unfortunately the democratic

leadership is not allowing us to go forward with replenishing that program >> speaking of the democratic leadership, you did get a letter from a number of senators yesterday saying that the labor department's guidance for dispersing the jobless benefits "appears narrow and ambiguous which could make states think they should exclude workers which congress thought would receive compensation through the compensation program." are you looking to clarify the guidance >> we put out all the essential guidance that states needed to implement these employment programs within about eight days, nine days of the c.a.r.e.s. act being passed. so we moved very quickly actually expanded what congress did. you know, the c.a.r.e.s. act as was passed by congress did not by its terms extend unemployment benefits to an uber driver who

was not able to serve customers because of a shutdown by the city or the state or just because the customers were not there. but i had authority which i used to make clear that benefits could be available there, too. that's a number -- that's one of a number of points that we'll clarify to the senators. i've been in touch with them i think we have a very good story to tell about how closely and quickly we've been working with the states to help them deal with this new program, an important program, and also a really high volume of claims they're experiencing right now >> finally, mr. secretary, you mentioned uber we had some investors come on our air recently complaining about gig economy companies like uber who because they kept employees as independent contractors never paid into the unemployment pool, as a result we are now all paying for those drivers trying to collect claims are both political parties going

to take a hard look at that in the years to come? >> as i said, the gig economy workers, independent contractors are covered by the unemployment benefit program that was established by the president and congress in the c.a.r.e.s. act they are also entitled to that $600 a week unemployment compensation payment, which is a generous one, much larger than most states play, but which the president thought was important to make americans whole who are making such a sacrifice as we try to beat back the virus >> mr. secretary, thank you. eugene scalia talking about the labor market >> thank you >> key concerns for the markets right now. thank you. let's get to rick santelli this morning. hey, rick. >> hi, carl. lots of strange activity as everybody knows going on in the treasury market, the sovereign debt market of the united states of america look at the two-day of tens. boy, did we jump overnight

we can debate what it is many think obviously it's related to potential drugs that are going to combat the coronavirus. others think it's the notion of the phase-in, maybe changing the dynamic. i think it's a little of both. what you should look chart, yes, a gap tire, but then it sinks down. as a matter of fact, look at a one-week of ten-year it pops and then it seems to sink back down again as we sit at 60 basis points, we're down three on the day and a dozen on the week. now, let's pair up ten-year with the s&p 500. i think we get some clues here followed us all the way down lookdivergence many see if you're an investor from a global standpoint or domestic, you're buying the equities and buying them because of the momentum, whatever reason, the drug, the phase-in, but you're also buying ten-year. you're buying both why? maybe it's a hedge that if the

equities go sour you have that fixed income but many still believe that ten year is considered a safe haven and it will increase and when you think about the global dimensions of other central banks in other economies and the perrer is tajs of -- percentages of other equity markets, america is the place to be so it isn't necessarily all a negative signal that the ten-years don't see anything good with regard to the reason stocks are moving. and let's look at a one week of the dollar index it's up a third of a cent on the week you see it on the chart. it comes coming back much of it is the pain of dollar demand no matter how you slice it, the demand is resilient and continues on the dollar. back to you. thank you very much. the markets are holding some gains. we got within a point of the s&p's 50-day which is 2862

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dow is going to try to close above 24,000 for the first time since march 10th in the meantime some of the gainers week to date include amd and obviously amazon whose strength has been well documented back after a short break feels like there's no barriers between departments now.

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welcome back to "squawk on the street." the land of mergers and acquisitions not because we have new deals but we continue to have deals that closed some deals you can manage the buyer -- imagine the buyers are sorry they couldn't figure out a way to get out i referencethat in relation to tall grass energy. this is a company that was already 44 % owned by blackstone and other partners and in december they agreed to buy the remainder for 2245 a share. it's an emergency company. midstream. the value is nowhere near 22.45 were it not in a deal to be acquired tries as it might have, and i don't know that they did one might have imagined they

tried to find a way to reduce the price. they didn't. the deal closed this morning sara, carl, it goes to how tight the contracts are. 3 billion in equity from blackstone and the partners and additional debt goes into buying what they didn't own it was not worth anywhere near what they're paying for that stake right now. over to you, sara. >> just want to update you on comments coming out of the m and g conference call. the company did well over the quarter as people stocked up on home products like paper towels and tooth paste. the cfo saying we're assuming it's already here, talking about a recession, and will be here for some period of time. he says while we're not immune, their strategy of basically staying in staples over discretionary items and increasing the value over the last few years should make them relatively not recession proof

he says but should help. also want to hit the chinese economy. we did get that quarterly gdp number out which was worse than expected we have a breakdown on just how the economy looked during the covid-19 pandemic that it experienced. >> thanks so much, sara. it didn't look very good china's gdp contracted by 6.8 %. a lot of the focus today was on the march data industrial output edelman the silver lining because it was only down by 1.1 % tax and credit relief for manufacturers seemed to help retail sales dropped by 16%. the breakdown shows people did not want to go out to dine or to go shopping. restaurants and catering dropped by half in terms of sales and people held back on shopping for cars, alliances as well as for clothing the national bureau of statistics said the big risk

going forward is deterioration of global demand as infections overseas surged. a lot of analysts are concerned about the potential spending power here in china. there's a lot of emphasis on the unemployment rate which came in at 5.9%. it's elevated in a chinese context. in fact, jpmorgan said today that the numbers missed two important parts. how people aren't looking for work or are underemployed. urban disposable income. it was the worst on record, and rule income also fell. the overall uncertainty now here over jobs and of income is likely to continue to weigh on consumption and of course that doesn't bode well for future growth >> stunning numbers all the way around data out of the u.s. as well lei. for that we'll get to rick

santelli >> i'll give you a hint on the data this started in 1959 okay get that well, it's minus 6.7 that's our march read on leading economic indicators which started in february of 1959. and in that whole run, the biggest month over month negative change is minus 3.4 in 2008, october to be specific so we've pretty much doubled down on that yes, minus 6 .7, the worst number in the run of the leaning economic indicators as an economic release but once again, we could talk about how horrible it is i'm not dismissing it isn't horrible. but in the end when you shut off an economy, i think the only thing that's more shocking is to see an up number for leaning economic ibd cndicators. >> rick, thank you let's stick with the market action this morning. it's positive. 2% gains at least all around for stocks the bond yields are lower. the chief economist of grant

thorton joins us along with andrew slimmon diane, when you look at the economic data, are you surprised to see the resilience of the market >> it is it's almost as if they're whistling along the grave side on all the graves that we're passing. it is hard i know that there is a disconnect and the economy is not the stock market and the stock market is not the economy, but we have never seen anything like this. the kind of monthly declines we're seeing would have been horrible annual declines in the worst of recessions. we're looking at retail sales down nearly 9% before we hit all of the state closings that we hit in march. we saw the production numbers, the worst on record. we saw big declines in housing starts as everything came to a standstill the deep freeze of the u.s. economy in an ice age, and the thaw will be much more slow and uneven >> so andrew, how does a

portfolio manager navigate that picture diane just painted with the optimism that we continue to see in this market, teeing off of some of the headlines around treatments and testings and vaccines and infection curves? >>. >> sure. i think the important thing to consider is the stock market is a forward indicator. it fell off a clip before the magnitude of the shutdown of the economy, and i think the market is rallying in anticipation of the reopening of the economy i think it's tough to get real optimistic near-term as we get close to 3,000 but that's what's going on the market is amendmenting a reopening, and if you look at today, as much as i think the market is going to run out of steam here near-term because it's now priced in this reopening, there's a lot of opportunities underlying the market because the market is so favored. the stay at home stocks that there was a huge spread of valuation between the stay at home stocks and the reopenings,

as i would say, stocks >> so where do you see the biggest opportunities and dislocations given as you say, i mean, there are some real bifurcation here, even for the week, which was turning out to be a good one. financials are down 5% energy is down 4 % real estate, materials, the sectors are lower for the week where are the opportunities? >> in may that you just listed travel leisure, the ones that survive will be the biggest returns. i don't think you need to even actually delve down to that level. i mean, people are going to go back and buy a cup of coffee and get a burger and fix up their house. i think consumer discretionary stocks beaten down, some of the payment processing companies have been beaten down. i notice today that two reits withdrew guidance and their stocks are up huge i'm not recommending it, but i'm saying i think the pricing is

substantial. yeah, the banks, there will be some near-term problems but the point of all this is is by the time it's clear that we are going back to coming out of our house, these stocks are going to be up a lot just like the market has rally d close to 30% off the low even though we're still sheltering at home because the market is a poor predictor. >> diane, where areyou and where is the street on the third quarter? i think everybody knows the second quarter is going to look terrible in terms of the economic data. very sharp drop in gdp what does g3 and g4 look like at this point >> actually, the second of the year is still a rocky period i think that's where the markets are really not getting this in terms of the risk. not only do we have draconian cuts at the state and local level. if we don't get transfer to the states it's some $500 billion short fall over two years.

twice as bad at least as the great recession, and we know from the great recession the reason we didn't have more of a employment recovery early on was the hurdles at the state and local level. we didn't transfer money to the states that's a head wind in the second half of 2020 and into 2021 we're looking at flat if we're lucky if the third quarter we could have another leg down in terms of as we try to reopen, then we stumble if we have to have lockdowns again also the rest of the world is not opening up synchronously they're opening up unevenly. we're seeing how that set back china in terms of manufacturing. the global economy is not opening up in sync any subsequent lockdowns are going to set sectors back after they try to come back a bit. it really sets for a rocky, narrowly positive second half of the year you could have some weeks that look terrific and a setback again. and i think that's the uneven nature that we are going into in

trying to apply old rules of thumb, even if the trover looks strong, it's not anywhere near the level of activity that we saw prior to the crisis. we think it will take over two years to recoup the losses to get the level of economic activity and some three years if we're lucky to see unemployment fall back down to the lows we hit prior to the crisis. that's better than the great recession with a lot of stimulus >> if it's two or three years before we get back to the same level of economic activity we had prior to the virus, why am i willing to pay as much as it would seem i am on a multiple basis for stocks right now >> i agree that's why i think the market is going to close as it's close to 3,000. what the market is going to fixate on is what is the right earnings for next year

not this year. as it gets close to 3,000, the market is trading at 17 times a reduced guidance we don't know. i think that's how the market to me is going to run out of -- this rally is going to run out of steam here because of that uncertainty about next year's guidance which will be -- continues to come down >> right and andrew, diane brought this idea up, and i'm sure you've heard it, the fear at least of a second wave. we certainly hope it doesn't happen we hope by the fall that there are anti-virals that are effective in stopping the virus early on but it's still got to be a concern. i'm not sure how you plan for that or how you choose to make allocations, but it is possible we could have a second wave and a loss of confidence that comes alongwith it, isn't it >> there is no question. but i think one of the things that as it pertains to the market, one of the things that will put a floor on too much of a pullback even if we had a

second wave is the continuous news flow of vaccines and testing. it doesn't necessarilymean it will be available, but i think the hope that there is development will put a floor on the kind of the pullback or the retest i mean, i think that's the real story is we're not going to have -- we're not going back close to where we were march 23rd because of the development of these drugs >> you know, we mentioned confidence, diane. people are looking at housing as one example. this nahb, buyer traffic, the numbers were horrible in april, but you look at is it a good time to buy a home, and it's down, but it's not down as much. i just wonder when you think confidence would start to back up this thesis that households are really going to be pinched >> well, you know, we really

are. this is one of the silver linings. if we can keep the housing market financial situation intact, the mortgage servicers along with the mortgagers so they're not seeing a lot of foreclosures down the road, the housing market is one of the sectors absent during the great recession and the recovery that followed to drive us out of it we are in a position the housing market was on a tear prior to this. if we can keep enough lifeboats in the water, the other side the housing market is one of the sectors with the mortgage financing intact, that part of the market with the fed is now watching very closely, you could see the housing market drive us out of this recession which is something we terribly need so that's the real hard part we try to plug one hole in the market and another hole opens up that the fed has to scramble to deal with. if we can do that, the infrastructure of our financial

system, low rates do matter now. >> if we saw another round of relief or stimulus passed by congress, dooiiane, does your economic view change can we get back faster if they continue to support and addmor money to the small business relief plan? does that change the forecast? >> it does, actually the critical issue is transfers to state and local governments the draconians cut are going to be a huge head wind. looking for jobs in a market with jobs are scarce if we can change that, that would help we do not have big stimulus for the state and local governments. right now we need to think about aid in terms of backstops getting us through the phases of this crisis and ramping up and stimulus on the other side infrastructure state and local infrastructure spending is at a 50-year low

how many infrastructure weeks have we had? it's time to think about that now for 2021 so there's something in the pipeline to tap when we need it most >> bring on the infrastructure weeks. diane, andrew, thank you >> i'm all for it at this point in time. >> andrew? >> all right, guys thank you. mortgages and housing, new numbers on forbearance from diana. good morning >> good morning. as of now, almost 3 million homeowners have taken advantage of the government's mortgage bailout as part of the cares act. just a few days ago the mortgage bank reported at 2 million you can see how quickly the numbers are rising this represents 5 .5% of all active mortgages it's according to new data just released by black knight, a mortgage analytics company the program allows borrowers to delay monthly payments for up to a year and they're paid back in a modification or paid back at

tend of the loan they have to say they have financial hardship due to coronavirus, but they don't have to show any proof or documentation. the 2 .9 million loans account for 651 billion in unpaid principal. 7.6% of all fha and va loans even if borrowers don't make their monthly payments the mortgage servicers have to advance the interest each month to bondholders a current level they would need to advance 2 .3 billion per month to mortgage bondholders. jeannie mai has set up a liquidity service to help. there is nothing for fanny and freddie backed loans that's a big fight people have sent letters to treasury asking for this liquidity facility saying that it is a desperately needed to keep mortgage servicers afloat

so far no answer to them and the fhfa director who would be talking with the treasury and federal reserve about this has said in no uncertain terms he doesn't think a facility is needed again, the industry is fighting hard against this. incredible numbers nearly 3 million borrowers back to you. >> thank you stocks are obviously off of session highs. we're trying to hold down 24 k in a roughly 2 % gain in the p. squawk in the street is back after a short break.

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anxiety is still very high, and we hope we have the ability to reboot, but in doing so, and i know many leaders told the president yesterday we need to have adequate testing to make sure we have a secured environment. >> it will be absorbed in the cost of business, but you know, what has to happen, it's the fear has to -- >> what will be needed for coming back 100%, the testing is important. vaccine is important over time. so a lot about the around that, how that can scale quicker >> testing, but before testing to make sure you've got it, and then testing to make sure you've got rid of it. clearly tough priorities from my perspective. >> that was a number of ceos talking about testing, how important it is if we're going

to be successful in reopening of the economy. another important part of this, of course, will be finding drugs that are effective in treating covid-19 shares of gilead up sharply on potential hope for its drug, remdesivir let's get to meg and find out what we know and don't know about remdesivir so far. meg? >> hi, david we are waiting for the official clinical trial results to come out. a report last night from stat news gives us a glimpse into what one hospital treating patients with remdesivir saw this is anecdotal. this is not the final clinical trial results. what this one hospital, the university of chicago saw was they enrolled 125 patients onto those trials 113 of whom were severe. they said they saw rapid recoveries in these patient's fever and reps symptoms. they said nearly all patients were discharged in less than a week and they saw two deaths

amo among all these patients there is pushback about the results because they are not from a formal clinical trial one called the exuberance out of control saying we're cautious on interpretation of what amount to leaked case reports given the frequency with which we've seen controlled data refute previously encouraged data from small uncontrolled studies he points out while the first data we're looking for will come from gilead's trial at the end of the month what is going to give us an answer is the nih trial expected to read out at the end of may. because that is double blinded, meaning the people don't know, the doctors don't know who is on the drug and who is on placebo and it's being tested against a placebo. that's the gold standard people look for in terms of proof about whether a drug is working but we're in an unprecedented situation and everybody is waiting for something that works. so clearly, a lot of hope that this means remdesivir will

david? >> meg, thank you, with the latest on the hopes for remdesivir let's get to bill george now who joins us frequently as well. sometimes with guests. sometimes on his own the former medtronics ceo, a board number of a number of important companies. bill, good to see you. let's start off with your take on the plan that was unveiled from the administration for trying to get the economies opened up in various states. the phase one, phase two, and free phase three. what are your thoughts do you think it will work? >> i think they've put in clear criteria of what needs to be done, and the states are clearly taking charge. we had seven midwest governors announce their criteria. but what i would tell you, david, is until we get more testing and more ppe out there, it's going to be very slow i've talked to about 15 ceos of large companies and their number

one concern without exception is employee safety and the safety of their customers particularly those in customer-facing industries they're not going to be fully back in business until they can ensure that. that means testing of their employees coming to work and it means contact tracing. we need to move aggressively on this and get contact tracing and health care workers out there, public health workers to do that and so i'm concerned we're moving too slowly. but it is i think that's a start. but those criteria are going to take a while it's not going to be anything close to moving -- reopening the economy. you can't just push a button and open this complex of an economy. >> no. it's not like turning on the lights back on many people say, and bill, your focus on testing you been talking to a lot of ceos we heard from a number of ceos that joined us in the last day or two it seems to be about having the tests available, ubiquitous in a sense.

i can't imagine what it's going to cost in terms of just testing people constantly. >> yeah. >> but do you have any sense as to when we're going to get there and be in that position where business can rely on the tests being available that they need >> well, first of all, i think right now we're not even able to test the people that are quite sick a lot of them are not getting tests. so we're not talking about employees that are otherwise healthy, we think and learning about. we've got so much more to learn. we'll have tests to tell us more about the existence of oi antibodies but these are take time to ramp up. that's well into the late summer or late fall before we get really ramped up on the tests. even then, you're not going to just turn the economy back on. consumers are going to be concerned until we get a vaccine so they feel protected, they're not going to go into shopping malls. they're not going to go to sporting events or get in airplanes that are crowded with three people in their row. so i think you're going to see real caution until we get first

of all we get the testing. and then we get a vaccine. i think we're still 10 to 12 months away from a vaccine that's in wide use you can't put a vaccine out there for 100 million people unless you're very sure that it works and has to be fully tested the green chutes from remdesivir are encouraging, but -- and the work that gilead -- that various companies are doing, gilead, johnson and johnson, but it's going to be a while. for now, we're going to go into a partial fit full and slow recovery and so the economy will be operating at far less capacity and i think we haven't even begun to think, david, about what's the impact on consumers that don't have any money to spend. they're trying to put bread on the table. they're not going to be looking for expensive homes and brand new cars so i think those high ticket items will take at least a year and maybe longer before we recovery and the unemployment rate goes

to 20%, you're going to have a lot of hardship and a lot of fear out there that i'm going to be the next even though i didn't get laid off, maybe it's coming and you see the huge layoffs i think these things are colliding. the disease and the economy, and it's no quick fix that i can see. >> but, bill, i mean, there's one thing you didn't mention between the testing and the vaccine, that is a potential treatment which is why i think the news on gilead is so encouraging. and i wonder if it's being estimated -- underestimated how many companies, small and large, are working on treatments. they're repurposing drugs. i mean, even remdesivir was a failed ebola drug. but for cancer, arthritis, for the plasma antibodies, there's so many different treatments out there getting tested and going through clinical trials. i wonder if that's the key to unlocking consumer confidence. if there's something that can be out there that -- where people realize they won't have to go into icu or hopefully to

hospitals that could bridge us until we get that vaccine. what's your level of optimism there? >> i think you're dealing with treatment for people who are very sick. all the testing is for people who are very sick. i don't think it's going to build consumer confidence. it may reduce the death rate which would be a wonderful thing if we can do that, and you heard they had a male last week talking about the antibody treatment their therapy they're working on i think these things could come by the fall, but remember, we have to have people feeling confident to get -- are you going to go to a football game with 50,000 people or 60,000 people crowded next to each other? we're going to have to change and reconfigure the workplace and reconfigure the restaurants so that maybe only half capacity i don't think you're seeing people jumping back in all the business i know are thinking about the new normal as we call it it's not going to look anything like it did last fall. it will be totally different in 2021

and i think we're looking at permanent new normal and i don't see it as we're going to find remdesivir works as a treatment and everyone is rushing to the malls i think you're going to see the economy looking very different it won't look anything like it has. we're going to do more online, work from home we're going to do things like that which will change the game dramatically for people. and i think can restaurants make money? can they break even at half capacity if they have to separate people? it will be a while before we see the booming which i we saw last fall >> that was the big debate last night when the remdesivir article hit. it doesn't influence transmission how encouraging is it when it's still something that you have to get in a hospital when you're very, very sick? how much confidence does that really provide i did want to ask you, though, a couple weeks ago we were talking about masks, ventilators, respirators. that display crunch seems to

have gotten better do you think we're going to need all those come fall or will we be up to our eyeballs in ventilators in the next couple months >> i don't know how much better it's gotten, particularly on the mask side. a lot of people are putting out calls for masks who don't have appropriate masks. i think we're a long way maybe marginally better. i think ventilators, a lot of people ramping up. you don't turn on an automobile factory and make ventilators overnight. it takes time. i think yeah, maybe by next fall we'll be out of that problem we may have excess supply by then, but some of the pricing is going on now, chinese companies and you probably sawthere's th uk government, national health service ordered $20 million from the chie freeze for tests and they didn't work i think people, there's a lot of scattered shot i think wee need a national approach, a national czar to run the ppe and ventilators and everything else, and surely the defense production act is

implemented. i think we're a ways away from it there are a lot of companies coming in. i think companies are stepping up, carl, but i'm not as optimistic about the consumer side that's what i'm worried about. we're a consumer driven economy. look, everyone i know is cutting capital 50%. the emergency industry is devastated by low prices and hopefully this opec agreement will help. but i just don't see the economy bouncing back and so these are like i say, green chutes out there. >> yeah. bill, it's funny you seem to be having similar conversations i have which often lead to but man, the s&p seems to be doing well i'm not going to ask you for your market prognostication, but i would love to come back to your point of the new normal companies are in the business of trying to anticipate what's coming and like you, i have a lot of conversations about things will never be quite the same. who is going to win here the companies that adopt the most quickly in terms of the new

world? >> absolutely. and i had two ceos tell me yesterday we can get three to five years of restructuring done right now. this is the opportunity. they're moving aggressively and accelerating the digital transformation to get in front of that, and looking at how the reconfiguring their workplace and reconfiguring their factories and frankly, they're going to reconfigure their organizations dramatically they're going to revalue the front line workers that's the thing doug mcmillen got out in front of at walmart we're going to have far fewer middle managers and we'll have to take costs out. they're going to move aggressively they'll have to. they don't have any choice but to move aggressively and take costs out of their system. that's why i worry about the layoff side. but i think that will be good. the companies that will win, that anticipate what the new normal look like, and how are consumers going to behave? what are they going to want to

do and if they can anticipate that best buy is a good example they laid off 51,000 people, but they have anticipated how their in-home service is going to work f. can they do more of it online their business shifted heavily online much faster than they thought it would i don't think they'll ever go back to that i don't think we'll go back to the old world. so i'm -- like food delivery a lot of people can afford it now and are having food delivered to their homes the grocery business is booming. i think we learn how to cook and eat at home again. i don't think people will go back to restaurants as much as they did that's what companies have to anticipate and be on the leading edge the ones that do will be the winners here >> yeah. so much to think about, of course, in terms of the way the world is going to be changed for a long time as a result of this. bill, always appreciate you taking time. thank you. >> thank you very much for having me. let's get to a news update

>> good morning. another large outbreak of covid-19 at a senior living center at the st. john's retirement village in california earlier this week officials said that 35 people there tested positive and one resident died several employees have told nbc affiliate kcra there have been new infections with one saying the total is now above 50. in wuhan at least 50% more died than previously reported. the government raising the death toll to more than 38 00. china denies claims it intentionally undercounted deaths from the virus. oktoberfest, the event is unlikely to take place this year the final decision is expected in the next two weeks. and finally, michael cohen former lawyer for president trump is getting out of prison early because of the pandemic. he will serve the rest of his three-year sentence in home

confinement. nationwide thousands of prisoners have been released early because of coronavirus for more, head to our website, cnbc.com >> thank you time for our etf spotlight the energy sector in focus with crude oil at the lowest level since january of 200 2 meantime xle participating in the rally, but it's still down more than 45% so far this year energy the hardest hit sector for the year by far, but has done well with this recent market bounce sharply off of those march lows we'll take a quick commercial break. keeping track of the market we've lost a little bit of steam here the s&p up 1.6%. stay with us isn't just a department.

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welcome back it's the question on everyone's mind when can we reopen the u.s. economy? our next guest is richard trumka thank you for joining us >> thanks for having me. >> i can imagine you saying a couple things this morning one is labor is itching to get back to work and the other is labor is worried about getting back to work what is labor's view on the reopening? >> you're right. we have two groups of people we have one group of people working day and night, and they're worried about their health and safety. another group of people, 22 million people laid off in the

last four weeks that are worried about their livelihood and their health care. look, we're looking at it from a safety point of view first right now we can't even take care of the people's health and safety that are working. we have more people getting infected in all the different industries so we have to focus on that. i told the president during that period of time there's five things we need to do one, workers have to have a say in how we go back at every level. whether it's the industrial level, the workplace level, state level, local level, or federal level. two, the decisions have to be made on sound science and worker's safety. three, there has to be an infectious workplace disease standard set in place so everybody knows what they have to do and workers have a way to know they can be protected to major themes that came out of that call.

one was there has to be a massive increase in protective equipment for workers that are on the job and those that would be returning. and two, there has to be a massive increase in reliable rapid testing. i think your last guest had it exactly right. given that and given the emphasis being put on the states to make the call, do you expect the standards to be set state by state or what's owe sha's role right now? >>. >> could you hear the last question >> i did not i'm sorry. >> i'll repeat it. i wondered whether or not the safety protocols is in a state by state or is that an osha-like federal standard that will help states understand with when it is safe to work. >> unfortunately, there was a

federal standard and the trump administration did away with that now we have to recreate it so you would do a federal standard, but it would have each employer have to do a plan specific to their location as well as train their employees and get the protective equipment in hand. that needs to be put in place. person after person on that phone call, ceos said we need protocols. we need to know what's expected of us. that standard is absolutely essential for us getting back to work so we can tell people what you need and what we have -- what protections we have as workers >> when do you think you're going to get that? >> we're hopeful that cares 2 will mandate it. unfortunately both the three organizations that are responsible for worker health and safety, that's the occupational safety

administration, the mine safety health administration, and the national institute of health and safety, they've been awol. osha has fewer inspectors and health care experts than in their history. they weren't prepared for it in cares 2, not only would we mandate that there have to be an infectious disease standard but also rehiring people and putting more inspectors on the job, because right now we have enough inspectors on the job to inspect each workplace once every 165 years. as you can see, that's totally inadequate what the standard at least workers would be able to enforce it themselves and not have to depend on the three agencies that have been awol in this pandemic >> you mentioned cares 2, so to speak. what are your expectations i know you talked to a lot of

political leaders on both sides of the aisle are we going to get a cares 2 any time soon? >> well, i certainly hope so we're working hard toward it and we have five essentials, economic essentials for cares 2. the first, of course, would be keep front line workers safe the second would be keep workers employed and protect earned pension checks because in cares 1, pension people, near 35.5 million of them that get their pensions from private pensions, from multior single employer plans, they have no help. there was a crisis in the pension plans beforehand, and now it's been made worse so that's done then keep state and local governments, public schools and the postal service solvent expand health insurance for all workers. people laid off will lose their health care if they got it from work at the most vulnerable

time and the last thing we ask for in cares 2 is keep america competitive, hire people to build infrastructure so that we had work in a great infrastructure bill. >> richard, obviously all american workers need to be protected, but perhaps most of all our health care workers. we got some new data from the cdc this week showing something that we were all afraid of which is of the 50,000 people tracked as positive cases of covid-19, 20% of them were doctors and nurses are the federal and local governments, are the hospitals doing enough to make sure they have what they need in terms of the protective gear? we've heard about the masks coming into this country we've heard about the gowns and face shields is that all happening and how can we gauge whether they're getting the help they need to protect themselves >> well, they're not getting the help they need, and, in fact, the center for disease control,

the cdc, keeps making it worse because they keep issuing guidelines that are geared toward accommodating the shortage of ppe rather than protecting the front line workers. and so the guidelines keep getting worse so they accommodate the shortage we're working hard to get those ppe on the frontlines, but you can see that 20% of workers or health care workers who have been on the job protecting others and they haven't been protected. now, if those 20 % come offline because they're sick, we won't have enough health care workers to take care of people that's why we say the first thing you have to do is take care of people they are not getting the protective equipment that they need at any level in any industry not in transportation, not in transit, not even front line workers like letter carriers and postal workers to keep the

economy going. so we're pushing that and saying that there has to be a massive increase in protective equipment for workers that are on the job and then have them available for those people that are going to come back to the job so we don't just create a second surge through all of this. >> finally, rich, you know, we tried to get the labor secretary earlier to talk about what state in the nation mind end up being a test case for how you do this? people point to washington today because of this boeing news. people point to ohio because of their early measures do you have an idea? what will be the focus which state? >> i don't know that you'll be able to go state by state. it will be little areas going back to see what works looking overseas to see what worked over there would help us and be instructive for us. whatever we do, we have to make

sure that the people that go back to work are protected and the people that are already at work are protected. and that is our main concern root now of course we want to get the economy going again, but we don't want it to be at the expense of hurting people. on that call with the president, most people were very, very i think sincere and honest, and i told you about the two trends that came out. but there were a few people on the call that are really trying to take advantage of the pandemic there were a couple of people from a right thing think tank on there that said if you want to get it back to work, an solve employers of liability from their workers. now, think about that. instead of figuring out ways to protect the workers, they're willing to make workers a cannon fodder as long as they're protected from liability >> right >> i was disheartened by that.

i was heartened by most of the ceos just totally rejected that notion and said we need testing and a standard but we have to guard against that kind of thinking. >> richard trumka, we'll see you soon thank you for the time today >> thank you for having me on. i appreciate it. keep up the great work dow is higher and boeing is in the lead after announcing it's restarting commercial airplane production in seattle phil has an update for us. phil >> that production is scheduled to start on monday and then be phased in over the course of the five days next week until it's back to where they were before covid-19. at least on the wide body side of the commercial airplane division and remember, that's the production that's coming back still no production. final assembly production when it comes to the 737 max. for the ceo this is one big issue that basically he has taken care of on the commercial

airplane side. now they focus on do we have enough liquidity does the aviation sector have enough liquidity and a lot of the answers will come over the next few weeks as they continue talking with the treasury department about possible terms for a treasury loan. what strings are attached to government aid if they take it don't forget that boeing reports earning on april 29th. we'll see if we get any news before then. they also have their virtual annual meeting two days before that a number of times when we may hear from dave calhoun over the next couple weeks. look at the airline stocks we're showing you these because at 5:00 p.m. is the deadline to apply for the treasury department for treasury loans. this was the bucket set aside in the cares act for loans, low interest loans to the airline industry back to you, sara. >> all right we'll watch it thank you. as we head to break, dow is

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we are pulling back on most of our guidance we have previously given i think the best advice i've heard recently as we've all been watching cnbc is from jim cramer who said you would have to be an idiot to give guidance in this market so we're not idiots, and we're going to put the guidance on the

shelf for the most part. >> we're going to be talking with the ceo of kansas city southern at the top of the hour as stocks are off the early session highs. 'rba itwmites. at&t knows you have a lot of things on your mind. staying connected shouldn't be one of them. that's why we're offering contactless delivery and set-up on all devices. and for those experiencing financial hardship due to this crisis, we'll work with you to keep your service up and running.

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our next guest is the owner of several hotels including hilton, marriott and hyatt properties peachtree hotel group ceo greg friedman joins us on how the sector is planning to recover post-virus after being one of the hardest hit industries so far. thank you for joining us, greg. you have about 120 properties outside of the coast give us a sense of what business is looking like.

>> thank you for having me this morning and we do have 120 hotel assets and about 50 equity positions on different hotel properties across the u.s. and 70 where we have a first mortgage or a pog on different hotel assets business today is extremely challenging as you can imagine, just given, you know, the government mandated shutdown on most travel and so we looked across our portfolio today on average running 15 to 20% occupancy levels most of our hotels are in the service space so typically select service of course limited service type hotels. as you mentioned on the marriott and hiltonbrands these hotels continue to have some occupancy levels. we have a couple full-service hotels that are trending closer to 0% occupancy in most cases because there's little conference or business out there at this point. >> what is the status of your request for loans, whether it's

in the paycheck protection program or the other federal economic injury disaster program? have you applied and where does it stand in. >> yeah, sure. we did apply for the paycheck protection program and received our approvals. we went through a regional bank here in georgia called renaissance bank and that process was a smooth process and had a lot of success there we did get approval for not only our hotel properties invested on the equity side but as well as our corporate entities in regards to the economic, you know, injury disaster loans through sba, we did initially apply back in march towards the end of march unfortunately, we had to reapply last week because they did change the application that process has been a little disappointing because we haven't really gotten much feedback from sba in regards to that program and it's, you know, so it's been -- that's been a tougher program to deal with at this

point. >> the company was an aggressive acquirer of hotels during 2019 obviously without any idea what was coming i would assume you took on debt to acquire those hotels. are you paying that back right now? are you getting forbearance from any of your lenders or financing sources? >> sure. most of our lenders, because we did take on debt as you mentioned, most of our assets on our equity side, most of our assets we do have leverage or debt throughdifferent regional banks, community banks, some of the national banks and we are getting forbearance agreements in most cases we've gotten deferment of payments upwards of 90 days. in most cases that's what most of the regulated banks are offering that. we have some cnbs loans and still working through that process with special servicers >> how do you see this all working out? you know, assuming we get some openings and some of your hotels

can come back to a higher level of operation, but when you think about your debtload and the 90 days, how are you figuring out your balance sheets and/or costs are going to be? >> sure. we've shored up a lot of likt over the last 30 days. you know, from our projection we think this impact from covid-19 is going to end up unfortunately business is going to be soft over the next -- it's been soft over the last 30 days and going to continue to be soft over the next 60 to 90 days and expect the effects will be felt the next 12 months as it relates to our hotel properties we've been aggressive from an asset management perspective shoring up as much liquidity as we can to make it to the other side of this, you know, pandemic that's been, you know, a big focus, finding ways to cut costs corporately as well as at our properties so that we're in a good position from a defensive

perspective and, you know, as a company, you know, we're starting to, you know, look at ways that we can play offense as well as we come to the other side of this, you know, unfortunate event. with that said, you know, we're going pack to the, you know, paycheck protection program. that's part of the issue there, there's not -- although we did get approval for it and i'm very appreciative of the bipartisan support of that program, you know, unfortunately that's not enough capital for a typical, you know, hotel owner to get us to the other side of this, you know, this basically government mandated lockdown on travel. it's, you know, unfortunately one of these situations where we probably need ten times of what the current program is providing capital wise to get us to the other side to be economically neutral. when i say economically neutral, meaning covering the economic losses not even us making profits that we projected to make over the next 12 months, but actually just to break even when you look at our expenses to operate the hotels from not only, you know,

[ inaudible ] a lot of other expenses including debt service, franchise fees and so forth. >> what does the other side of it look like, greg have you given much thought to how travel an stayid staying atl is going to look like in this country after we finally reopen? >> yeah. personally i believe we're very -- as a country we're very resilient. i think without question the next 12 months is going to be challenging and it's going to be -- i think a lot of people will have concerns as it related to travel, given covid-19 and, you know, barring us find something type of therapeutic or vaccine so i think that could limit especially group travel, conference, business, meeting business i think that business is going to be soft over the next 12 months i do believe, you know, i think when you look out 24 to 36 months from now i think you will end up getting back to 2019 levels probably 24 to 36 months

out. >> greg friedman, best wishes to get through this. >> thank you so much. >> thank you for joining us to talk about the story from peachtree hotels carl >> thank you i appreciate the time. >> sara, we've got comments from berkshire hathaway's charlie munger to the journal this morning. he said i would basically say we're like the capital of a ship when the worst typhoon that's come we want to get through the typhoon, not playing oh, goody everything is going to hell plunge 100% of the reserves back into businesses. of course we're having a recession. the only question is how big it's going to be, how long it's going to last. i don't think we'll have a long-lasting great depression, but we may have a different kind of mess. all of this money printing may start bothering us we'll look to see if any market reaction comes after that. good friday morning. i'm carl quintanilla with morgan brennan and dominic chu coming

to you live from separate locations. averages off their session highs. plenty of stocks to watch this morning. apple taken to a sell at goldman. pg, schlumberger out with earnings, there is a lot to digest and we will turn to bob pisani to kick off the hour. hey, bob >> well, we've had a great morning. we are off of the highs, but it's amazing what a little hope for getting people out of hospitals are going to do for you right now. i just want to point out that all of the stuff that was the laggard this week are the leaders today. a lot of concern about the russell 2,000 lagging. it's a leadership sector today banks, a terrible week frankly, worse than normal. banks normally drop going into earnings but this has been a rough week home builders, their leaders, industrials their leaders, even energy believe it or not has been a leadership group this week look at the dow leaders, carl mentioned boeing with hopes of restarting some production over in washington.