morning. we'll be paying attention. the task force at night i watch it to keep informed. >> stay well >> you stay well, too. a final check on the markets oil jumped futures are up 400 points, but we lost more than 1,100 the last couple of sessions join us tomorrow "squawk on the street" is next welcome to "squawk on the street." i'm carl quintanilla with jim cramer from various locations. david faber has the morning off. delta's ed bastian will join us in a few moments stocks are looking for a bounce as the senate sends a package to the house. decent earnings from netflix, snapchat, chipotle, texan and others are overshadowing the 21-year low in brent crude oil as joe and kudlow were saying, a bit of a bounce here. >> the president tweets i

instructed the u.s. navy to shoot down and destroy iranian gun boats if they harass or ships at sea obviously that's a policy, that's going to make it so that anyone who is short oil -- there's so many people short oil, might say it's worth covering here. i had a big win. it's geopolitical, the fact there's a failed instrument out there called the uso, i say it's failed because it's not been able to handle the selling >> yeah. executing a 1 for 8 reverse. >> are they really >> we talked about the usa more th than we ever have. >> some things should have never been created, the uso was blessed when the s.e.c. not around, people lose money, but there's no constituency that

says you can't lose money. >> what do you make of the general notion that the president's tweet aside that some of the results last night were better than feared. you have a list of companies now that have been able to either sell a stake privately or through secondaries and we'll get to that in a moment. plus the senate package making progress does that add up to anything substantial today? >> absolutely. i looked yesterday, one thing that was key is that darden was able to price a big slug of stock. they did 7.8 million shares at 58.50. you did really well if you bought that. united airlines selling 39 million at 26.50 you're up on that. the markets are functioning. netflix was incredible texas instruments was amazing. chipotle was amazing so there's part of the economies that are in disarray and then parts of the economy that are doing quite well

the government seems to be aiding the companies in disarray oil is a separate segment, it happened so quickly. they'll get to it. i guess what i'm saying, there's reasons to be hopeful given the fact the dow went from 29,000, to 18,000, back up to 24,000 some shouldn't have bounced, many should have >> yeah. then this other dynamic, jim, that people are talking about, high yield, given the way the capital structure works, suggests that stocks should follow and maybe have additional upside from here, though then others would counter that the fed sort of clouds that relationship between junk and equities >> i think if you want to do that, you have to watch the banks that are at the epicenter. i watch wells fargo. they have should many loans to the oil patch. the stock hangs in here. always like to find a stock that really kind of typifies the moment wells is a bank with a good yield. it's the buffett bank.

has a lot of bad loans, new management it hangs in there. if that stock started in free fall, i would be much more worried than i am. >> mnuchin, of course yesterday talked about the package that's working its way across the hill. 484 million that's going to the house, 320 for ppe, 25 for testing, 75 for hospitals. here's what the treasury secretary said yesterday >> i think phase four will most likely be what we would need i think based upon what we're seeing and the reopening of the economy and the amount of money we're putting in and working with the federal reserve on 13.3, i think you'll see a lot of liquidity we look forward to business rebounding later this summer >> now that's getting interesting, because now we're talking about actual economic stimulus rather than rescue, right? broadband infrastructure spending, pelosi talking about money for elections, money for mail service, things like that

>> i liked everything i heard. it says we're not just tiding you over, we will actually be able to play offense here. that's important there's a lot of people getting rested in the country. i think we overplay that different governors are responding to constituencies who say we want to go to workers haves health concerns who say we're not there yet. but every day we get somebody new doing something in health care we have got a better handle on the abbott lab test. apparently if they're done correctly, they do work. last night i had parkuritan swas on, they make the swabs. excellent conversation we're getting this overall you'll be able to get tested, soon you can get antibodies. we have to anticipate we'll get that news and this vanguard of people who have the antibodies who can go out and do things

i'm not calling them immune or super people, i know come winter it can come back again they are the people we need to lead us out of this. >> that is very true, jim, that's not mentioning the human trials of a vaccine candidate in the uk and germany today announcing trials. we'll watch all of that. jim mentions the airlines. we want to get to phil lebeau with a special guest >> let's bring in ed bastian, ceo of delta you reported q1 results today. a smaller than expected lost everybody realizes it's all about q2 and the remainder of the year how bad is business right now? >> thanks for joining us today, phil, and thanks for having us on i do want to share on behalf of the 90,000 men and women of

delta air lines that we're doing everything we can to stand with the people of the world to fight this awful pandemic. we're heart broken we lost some of our own family members to the virus, we want to make sure that everyone knows we're doing everything we can to find a solution to this awful crisis the challenge in the business right now is demand. with all the stay-at-home orders, the challenges with respect to travel, it's well documented we're operating at less than 5% of a normal passenger load today we're operating with 30,000 passengers on our books and the important thing to note is that those are essential passengers, those are people out in the business making a difference, whether it's health care workers, people visiting families, whether it's emergencies, whether it's transporting ppe and health care items from china to the front lines of our medical personnel the delta people are heroes, they're out there working hard to keep the nation's airways open we'll do everything we can to

work through this crisis together >> ed, you were talking about those being essential workers. you're right there in atlanta. georgia is in the midst of saying we'll open up the economy again. do you believe you'll have many people they're in the metropolitan atlanta area who will say yeah it's time to get back on flights. or do you think it will remain essentially essential travelers only >> for the short it will be essential travelers only we've been open throughout this entire period. i believe with proper conservative caution, with taking safeguards, with working with small businesses to ensure that they're doing everything they can to social distance and build the economy and bring the economy back, we're taking good steps together we've been working through this. we're providing all the support we can to the local community helping them get back on their feet >> do you think that's the right decision they're making in georgia? the governor says let's start opening up this economy and also you're seeing it with florida and south carolina

>> right now in atlanta we're on stay-at-home orders. i think the governor has been talking about how to start to rebuild the economy. starting very slow starting in a phase one effort and i think it's going to be challenging. the recovery will take much longer than any of us would like to see but we need to start building back in a safe way the operations of our economy. >> jim cramer, always glad that you and your copeople come on fo your business, it seems you have an open-minded culture we salute you for doing that >> thank you, jim. >> first question. i see you're offeri erering free medical flights for those fighting covid-19. do we have any information to suggest they have a higher rate of illness since they're traveling on the planes? >> there's no evidence of that one thing we said when we started 30 days ago, you know, dealing with this crisis, the

first priority was to protect our people, protect our customers in the greatest way possible while we've done everything we can to conserve cash in the environment, we'll talk about that with respect to liquidity, we doubled down and tripled down on sanitation, hygiene, cleanliness, making certain every aircraft we're on is fogged every day the facilities, the social distancing practices on our planes, making sure people are at least six feet away throughout the cabcabin. changing the boarding practices. we board from the back first, to make sure people are not walking past customers sitting in first class. so there's no evidence at all that we're transmitting by staying open the virus >> let's say you offered that abbott 5-minute, 15-minute box before you get on. do you think it would change things after i heard you say what you said, i want to go -- you have a great flight to san francisco that i can take. i really want to go to san

francisco. i'm trying to figure out why i'm not going given what you just said >> well, we are enlisting the very best medical experts. one of the challenges with this virus that weath're all fightin it's turning a bunch of ceos into a health care ceos, i'm not a health care ceo, i'm an airline ceo, but we're enlisting the best medical advisers to make sure we have insight into the diagnostics, testing protocols, what works, how can we translate that into our business model through the vaccines what's happening on the vaccine world. does that turn into a position where we have immunity passports that customers will be required to enlist. i don't know the answer specifically to testing, but we have people working on it with the right medical experts to advance that process there's no question that until customers feel safe traveling, this business in terms of air

travel won't return at scale >> what did warren buffett say to you when he bolted from your stock? he was very excited about your stock. i don't hear anything that makes me feel like you did something wrong. >> we didn't do anything wrong i think if you ask mr. buffett, he would share the same. he sold below the 10% threshold. i'm not at liberty to disclose any conversations that we've had, but, you know, he's been a great investor, getting back into the business, we'll see what happens >> ed, it's carl good to talk to you. i wonder, this morning the cdc director is warning that we could see a second spike in concert with the regular flu season later on this winter. whenever a potential re-emergence in cases comes, how much money do you have to set aside again for another interruption in demand

>> well s thashgwell, thanks, cl we're actively pursuing cash and liquidity. one thing when we entered this dilemma, we said three priorities first, make sure we're taking care of our customers and people second, protect our cash, and third, take advantage of the time here to build the business we want for the future, to accelerate into the future not to rebuild what we had in the past it will create some interesting opportunities for us on the question of cash, our team and the finance team has done a great job raising liquidity. 5$5.5 billion that he's raised just since march in the private markets. we received on monday the first installment from the treasury department on the psp payment, 2$2.7 billion, we expect to end at the end of june with at least $10 billion of cash in the bank

with opportunities to raise more as we go forward the other part of the liquidity raise is not just financing but what we're doing on the cost structure which will separate delta, continue to separate delta and differentiate us in the marketplace. in this second quarter we're in, we've been able to find ways to reduce 50% of our total operating expenses within the current quarter from a standing still position over $5 billion of cash we're saving in the current quarter alone. team is doing a magnificent job because we know this could take several years before we're into our new normal of traveling. the other thing about this that i do know to be true, while there's a lot we don't know, we have more questions than answers, i know we're not only an essential service, we're a service people want to travel on once they feel safe to experience our product once agai

again. >> on load fak erer er ers factr the quarter it was 73/1, what is the new break even load factor for a major these days >> that's a question i don't think airline ceos want to figure out it just causes consternation the reality is we're in a cash preservation mode probably for the balance of this year realistically we need to get back into the 80% level over time we'll walk it through. we have a lot of capacity on the ground 600 planes are grounded at the present time only flying about 10%, 15% of our schedule at the present time as we were talking with jim, once customers feel safe to travel -- it's not just physically safe, it's also financially safe we have to consider the impact on the markets and the economy has had on discretionary spend as well.

once that happens, it may take two, three years to build it back, people will come back. >> ed, you were burning about 1$100 million of cash a day the end of march, you're hoping to get down to 50 million by the end of june. but you expect to be burning cash even at the end of the year is it likely we see you doing a daily cash burn through the first quarter and second quarter of next year >> it's hard to predict, phil, based on demand and duration of the challenges we're experiencing on the revenue front. the 1$100 million we saw in marh was true i do expect that by the month of june maybe even the month of may we'll have that down to $50 million a day. the team has done a nice job we're looking through the second half of the year, looking at what we'll need to do to continue to preserve cash, to keep that 50% of overall savings that we had in the second quarter, keep that same momentum moving through the business,

while we work to encourage customer confidence back in our product, in our business >> ed, i've been wondering, a lot of companies on "mad money" are designed to have success for office at home there's hundreds of thousands of people that i used to see on the planes, the extremely full planes, always guys in suits, making a fortune flying first class. do you think some thing also permanently change that the zooms of the world and webex will make it so some of your best customers won't be able to be flying after this >> i think there will be some behavioral patterns that will change no question about it it will take some time to understand what that means i don't think we're turning into a telecommuting work force i think we'll have a portion of travel that will move over to telecommuting. but the reality is the human spirit wants to engage with fellow humans. business travel is going to come

back people need to be face-to-face doing business together when it's safe, when that opportunity arises people will want to get out of their homes and go on those experiences whether it's for leisure or visiting relatives and people they have not seen in some time. we have to make it safe. we have to make it physically safe the other thing about this that is really important to remember is that we specialize in safety. in our business, flight safety is everything. we are the safest form of transportation in the world, the u.s. aviation system bar none. we need to take that same analytical approach and focus to personal safety and hygiene as you travel on board our aircraft and you work through our facilities as we have for flight safety for years we're confident we'll get there and get the business back. >> when i go to delta, i don't want these, these are the paper ones i want an n95, made by 3 mc, 3m

can give me gloves i would love to make sure the person sitting next to me has a mask so they don't give it to me i want to know the person next to me has the antibodies and i would pay triple to know when i got to san francisco, it's fine. how did you guys get to be known as an incubator like you're a carnival cruise? if you're not an incubator and you can demonstrate with masks that person next to me won't give it to me, why aren't people flying you have some pretty good bargains right now >> i think there's a lot in that certainly we do have masks, we have gloves. all of our staff, our front line staff are encouraged to wear them we have masks for customers. the majority of customers are carrying their own masks, as they should. what we're into is a new normal going forward. and it's going to be very interesting.

the reality is that you will find customers will come back to quality. there will be a premium for quality and reliability and the reputation of service excellence, all of which our brand represents delta is known for quality that's our hallmark, our calling card there will be the opportunity to lead with service excellence, and people working with medical experts, how do we translate that back into the business model? whether it's testing, safeguards on board the plane, whatever it takes, we'll do whatever we need to do to reinspire confidence in business travel and leisure travel going forward >> ed, as if you don't have enough to deal with with everything happening here in the u.s. and with your own airline, i'm curious what you think about what's happening with virgin atlantic you own 49% of virgin atlantic richard branson was out with a very sobering message yesterday saying we need help. the british government said you step up if you want help if the british government says

to virgin atlantic, delta owns 49% of you, they have to pony up some money before we step in what would you say >> well, on the delta front, we are not in a position to invest any more money into virgin, we're at the ownership cap of 49%, and candidly with the cash that we need to protect our own business, that's our focus the i trust virgin will work through its challenges with the government and with richard. if they are required to go through an administration process in the uk, i'm confident they could re-emerge there's a need for the virgin brand in the uk marketplace. i'm confidence once we get through and we understand where this virus is going to get to a point people will feel safe to travel again and the virgin brand will be strong it could take a legal process to get through that >> ed bastian, ceo of delta air

lines joining us from atlanta. we're usually down there every quarter, perhaps next quarter things will allow us to be with you in person. appreciate you joining us this morning. >> i miss seeing you, phil >> we'll talk to you next time carl, jim, back to you >> all right, phil thankst s for bringing that to . when we come back, we'll talk about this morning's bounce a lot of results to get to, and we have some calls on j&j, tesla, visa and more save hundreds on your wireless bill without even leaving your house. just keep your phone and switch to xfinity mobile. you can get it by ordering a free sim card online. once you activate, you'll only have to pay for the data you need- starting at just $12 a month. there are no term contracts, no activation fees,

and no credit check on the first two lines. get a $50 prepaid card when you switch. it's the most reliable wireless network. and it could save you hundreds. xfinity mobile. it's only human to find inspiration in nature. and also find answers.

our search to transform... ...farm waste into renewable natural gas led chevron to partner with california bioenergy. working to provide an alternative source of power... ...for a cleaner way forward.

let's get a mad dash with jim watching netflix today >> all right there's rarely in my own conference call, as soon as it's done i pick up my phone and facetime my daughter, what do

you think about distraction, unorthodox this is one of the greatest conference calls ever. the netflix conference call. these guys may just have it. they may say we don't know how much this stock is this is like amazon, once you tried netflix and these people are trying netflix, you are so hooked, it's ridiculous. it's because of the quality of the content and the quality of the people running it. we don't talk about them enough. we always talk about read. why don't we talk about gregory peters ted serrandos. spencer newman is fantastic. this is a clinic of how to run a business so that your customer loves you. i think this stock, if it comes down, you have to buy it and extraction, carl, what are you hearing? >> i am still working my way through some other titles. but to your point, it's a good one regarding the incredible sub growth in the quarter and the

degree to which there is some pantry loading of subs in the near-term. this is what hastings said last night about potential pull forwards >> the things we are certain of is the internet is growing it's a bigger part of peoples lives thankfully and people want entertainment. they want to escape and connect whether times are difficult or joyous that's pulling up. we had an increase in subscriber growth in march. it's essentially a pull forward of the rest of the year. so our guess is that subs will be light in q3 and q4 relative to prior years because of that >> jim -- >> i'm shameless here, carl. michael morris from guggenheim, he did the interview listen, i want to do the interview next i thought this was -- you're with some of the smartest people on earth

you get to talk to them. how about the fact they have everything already made for 2020 stop fretting about that how about the fact they have these things in korea i want to see. you know that faldo wasn't even mentioned? they have that much content. it's like when five came back when the great artists went over to europe for world war ii and filmed i cannot believe how good this company is who are these people who is ted serrandos >> all right when you have production happening really only in two countries, you think the stockpile of content is enough not to worry for now >> and they went into the all zoom action. they can do a lot of cartoon drawings they have a lot of stuff in post production all that will happen is more and more people will talk about their shows.

here i am jotting down everything i said, wow, if one more person tells me i have to watch this unorthod unorthodox, i know what i will do this weekend, typically nothing, but now i got something because i was on the netflix conference call. this is a guide for people who do nothing like me other than work. you have to be in on this call >> how do you explain to viewers sub ads were 2x the guide, but revenue was in line. how can both of those things be true >> the strong dollar did hurt them i was shocked. this was the company that was most hurt by the strong dollar, they broke it out. they are in a constant amazon mode that's where netflix is. people want to play roku for cord cut, but play netflix netflix is your zeitgeist.

it was always artificial intelligence i remember when i sat down with reed hastings, he said point blank why i like certain things. he looked me up. he knew what i liked he's in your brain more than covid ever will be in a positive way. >> let's get to the bell at the stock exchange, the chief security officer, and at the nasdaq, progeny. jim, netflix does sort of lead us to at&t misses bay p es by a penny. on the tape they say hbo max is a high priority and warner is rethinking their theatrical model until the future becomes more clear >> they lost a lot of directv subscribers. i like a good dividend if you want to go for dividend,

go for rer vverizon. at&t subscriber trends, just bad. they can say listen, they're not horrible, it's kind of like -- listen, guys, we're in last place, think about this, we'll draft higher but there's no draft in business that's the problem they're just in last place >> they say cash flow is strong enough to maintain the dividend. retire debt. continue to invest in growth do you not believe them? >> it's fine any time i hear a company say don't worry about the dividend, i'm worried about the bdividend >> they pulled the guide, at&t, kimberly also, quest, chipotle, lyft we're adding to the list of companies that say we're sort of

on our own regarding earnings models >> it's been my belief maybe we can get away from this forecasting nonsense kimberly was the -- the numbers for kimberly are extraordinary up 11% personal care, tissues, plus 13. costs going down is it sustainable? i still can't get toilet paper my executive producer came in in a huff, she said i have found toilet paper at a king everybody looked at her and said my god, what was it like how did it happen? so, yeah, thatkimberly one day it won't be wonderment, oh, my god, i found it how do they guide? texas instruments had a good quarter. chipotle had some airborne food

illnesses, they were ready like south korea was ready because of sars i've never seen a company more ready. i know brian nichol will be on later today, at 1:00, i'm jealous. didn't get the ppp money, i don't give a damn, i'm sick of the government any way, but it seems to me they did everything wrong. there's some clown who was making fun of me saying you don't know anything about chipotle, it will be big today it may happen, but right now it's up 64 >> amazing comps up 14 in february. then down 16 in march. he will be on at 1:40 eastern time >> up -- you know, 102% digital sales, april was better. my prediction is, i told these guys this, that if you are a

reit, you will pay them to be a tenant they're going to bring in customers. good, solid customers. i just -- i revere -- look at this you have chipotle, you have this gang of people who are netflix any one of them should be president of the united states no offense, mr. president. they put on a good show, just like you do. yours runs into overtime, theirs starts on time ed bastion, did you listen to that guy i came away saying, wow. we have some ceos who are no joke a lot of government people who i think are on the edge, but none of them could be the ceos of the companies we heard from lately >> fascinating point, you just made about what if -- what if our conception of what an anchor is in a mall is changing, right? >> yes >> it's no longer lord & taylor, maybe it's chipotle that brings in the traffic the other big interview will be

evan spiegel at 11:00 a.m., their loss is 21 cents, but r f revenue up 44. >> evan, forgive me for being a total jerk to you at various times. you delivered. but you had an inferior product when you didn't have that android. it was a great conference call what he's saying there, younger people with a lot of time on their hands, they go to snap they're either going to snap or trading on robinhood these younger people are -- we haven't caught up with what they're doing with all this free time they go to school half the time, they go to school on zoom, they don't pay attention -- well, the more intelligent ones do this is the thing i was trying to get at with ed bastian, will we continue to have the office

at home? people are changing so quickly, and they may not go back we like netflix, it's cheaper than going to a movie theater. epr, a reit, is doing so badly i think movie theaters are dinosaurs. that's why i wanted to bring back the drive-in. then i can at least stay in my car, go out to the lobby and get a 7-up >> the snap story, jim, does make me wonder about -- for example, people are now looking at the buy fifurcation within f.a.n.g., amazon, netflix killing it, and facebook and google coming under scrutiny because of their advertising does snap refute that? >> i think snap has -- that's a good point they have new formats which are lending themselves better to advertising. facebook, the problem there is small to medium-sized businesses you would think if facebook was

better run -- i know they think they're the best run company, if they were run like shopify, which directly supports the small and medium-sized businesses, if they were a little more like the brilliant people running shopify, an amazing stock, they would end up having a whole new source of revenue, new businesses constantly going to them facebook is not rewarding -- they're not rewarding the small and medium sized businesses so they have the virtuous circle they could use because they don't have it, they're not doing as well. just not disappointing. they should be better. >> we have a downgrade, guggenheim does cut visa today to neutral they're talking about paradigm shifting, higher unemployment, small business closures, bankruptcies down the road that cuts to your small business point, how much risk is in there

regarding some of these credit card names >> i think it's been overdone. the love for paypal is completely, i think, in many ways overdone. and i think that the dislike of visa is overdone these are still long-term trends to plastic and to digital. i think there's pockets where they don't go right. then people go right back to them i think fintech is doing quite well no, i want to take the other side of the trade on visa. that's a very good company it's a mistake to downgrade it >> there was a good upgrade of j & j, they go to 175. they say the decision to price the vaccine at not for profit is a master stroke when it comes to fighting the overall pharma pricing pressure from the hill >> alex gorsky is doing everything right there my favorite line is don't worry

about the talc and opioid. do you remember that was all that mattered and alilex gorsky was on the defense every day j&j is a revered company there was a note found by me where i called it a great company and the media wanted to crush me that's not fake news it's great one of the reasons why it's great, they're doing what they're doing with the vaccine and what they're doing with the anti-suicide drugs they're trying to get veterans to stop killing themselves alex gorsky, a distinguished graduate of the united states military academy, that company is worth revering and they're doing a lot of things right. if anyone is going to get the vaccine, it will be j&j. when i speak with their scientists and affiliates, i'm heartened that we'll see something at the beginning of

2021 most people are skeptical of that, like they were skeptical about a vaccine for polio. it happened. >> pfizer is one of the sponsors of this german trial oxford is working on the other thing. you think j&j has the pole position >> i have a friend betting on pfizer he says i'll take you. ail take pfizer. and he's a save i hasave savvy . at one point i was speaking on friday and the guy says you don't understand anything i'm saying, do you i said the reason i got that 4.0 is because i got that class, that chem class, that could have dropped my gpa he said i have five more minutes with you i said go -- go save some lives.

i'll figure it out i said i went to harvard he said not the harvard i went to did i go to the phoenix online harvard? no, but very different places. >> jim, we have a few more names to get to. we are trying to close in on 2,800 again. let's get to bob pisani this morning. >> good morning. happy wednesday. nice bounce back today if you can identify the reason, you're doing better than i can there's not a lot of specific news out there all the stuff had a rough start to the week monday and tuesday bouncing back today. let's look here. energy stocks, exxon and chevron are the biggest percentage gainerers s on the dow jones industrial average bank stocks. all sectors that were under pressure when the coronavirus news is bad, and better when it's better. not a lot of change in the news situation. consumer staples are

underperforming this morning oil has been a huge focus. just want to mention the uso, that oil etf that has been the focus of a lot of attention, they are engineering an 8/1 reverse stock split that will be effective april 28th so eight times what the value is right now. the key is we told you yesterday the fund is no longer investing in the front month futures contracts, it will be a mishmash of different futures contracts going out for several months in any combination they want. right now they can't create new shares they are waiting for approval from the s.e.c this etf is trading at a significant premium. so it's hard to value what's going on here until we get more shares created we watch the number of companies withdrawing guidance you heard from the guys earlier, lyft, chipotle, kimberly clark,

at&t, netflix provide guidance and basically said it was guesswork. that was kind of amusing you get an idea of how difficult it is figuring out what stocks should be, why are we opening so big today? down so much today you can't value a future stream of earnings if you can't give an estimate on what the numbers will be. this is why the vix has been elevated it was coming down it's kind of stuck now around 42, 43, 44 that's a problem we're sitting there very, very highly elevated. better than 85 a few weeks ago still that's elevated. doesn't show sign of going down. all this volatility is helping the exchanges. nasdaq reported earnings great numbers. historic trading volumes they had messaged traffic twice normal, options traffic twice normal the exchanges are one beneficiary of this. there are companies out that are trying to deal with their

problems by doing secondaries. some of the pressure there united announced one last night, 5% discount. darden at a 5% discount. carnival with a 38% discount this is the last option available for companies. that's why not a lot of companies are doing them we have some spac news today a spac out today this is chamath palihapitiya, raised 7$720 million, going to g public on the new york stock exchange today pete will be alone on the floor doing that the shout out to pete there. the nyc did get approval from the s.e.c. to do electronic openings for ipos through may 15th that tells me there's companies out there that want to ipo that's interesting

maybe albertson's. they have the ability to do that through may 15th when will the nyc reopen we don't know. there's no date set up there's several criteria needed here more medical screening we have to make sure people are not virus infected on the floor. they'll probably have a low density footprint when they open and maybe masks and other changes. we don't have an opening date, but obviously the ability to assure people that people are safe on the floor is the most important thing. back to you. >> all right bob, thanks for that jim, i wanted your take on the secondary list bob assembled there's some others, expedia in this "journal" report dealing with apollo and silver lake. we have a story on macy's sniffing out 5 billion in new debt using real estate as collateral, not herald square. >> it seems like the brokers and underwriters are pricing these deals so you make some money look at carnival, you crushed it

in carnival. the darden deal was excellent. the numbers raised the next day. i think the united deal will be excellent. i appreciate right now the underwriters are trying to make you some money and doing it. you have to be in these if you want to make short-term money. >> yeah. you mentioned texan earlier. go into that more. the range on the quarter, 64 cents to 1.04. you could drive a truck through that >> the reason i liked it is because as they say at the end, history has shown us it's times like this when we can make the most strategic progress. this is a conference call about how to take advantage of the fact that nobody else has the balance sheet they do, has the product they do. you feel the same way about amd. they are trading together. they shouldn't, because texas instruments has more auto. it's a very good clinic about how to handle a downturn

texas instruments has been around for a long time the stock is a buy terrific >> we didn't even get to some of the european names roche, stmicro estimates are all over the place, but you could make an argument that at least this week, maybe just today, the results are a lot better than feared >> i think we'll be surprised. there are a lot of companies built for this moment and a lot of ceos who came out of 2008, like texas instruments, and said we'll never let this happen again. we'll never let our balance sheet get as bad i think it's really a joy to listen to some of these ceos who know what they're doing. business is often castigated during this period business is the greatest platform of social change and they show how to handle things right during a difficult period for the american people. >> yeah. good point let's get to rick santelli this

morning, check in on the fixed income good morning, rick >> good morning, carl. i heard bob talking about he couldn't really figure out reasons why today is an up day in stocks and yesterday was a down day up day in stocks, up day in yields, what i'm hearing is how much credence you put in some of this, but there's always reasons. one of the reasons is some of these random antibody tests seem to be showing promise. that's a good thing. let's face it, various states talking about reopening at least phasing in at least a planned reopening. this is good for the psyche. i understand all these things are a long way off from getting our arms around the coronavirus. but they are positive. two-year chart of ten-year note yields, yesterday we were toying with 54 basis points we didn't get that low today 54 is important. open the chart up, that's the all-time low yield close we bounced a bit we're steepening the curve again. steepening about three basis

points that's the amount of basis points, ten years are up the big story is what's going on in europe. eu policymakers will be getting together do keep in mind that the ecb and germany and christine lagarde have noted gooded whether they'll be able to actually issue euro bonds or corona bonds but they still need to do quantitative easing and there's always that hope that something is going to get done the meeting today will discuss whether they lower the bar on collateral will they accept junk as collateral because the ecb has to buy these bonds from spanish central bank, italian central bank that's the heart of the story today. let's look at ten-year spanish yields year-to-date. almost at levels we have not seen since february. so 14 months, as you see around 1.16 there italian 30-years in the 3% neighborhood, they haven't been at that level in 20-something

months here's the real question 30-year bonds and 5-year notes were issued today by the italians 16 billion in total, with 110 billion in bids. that's almost seven times and n the 30-year chart, they're two-year zoomed as well. you're getting premium yields for credit they're unsure they lower the bar to accept some of the paper. why? and why did they have the auction today? because in a couple of days the s&p is going to put their rating under review and they may lose their triple b rating which is two grades above junk. all of this is figuring in and in the grand scheme of things makes our paper look so much better that's one of the reasons our yields are staying so low, especially on long maturities. carl and jim, back to you. >> all right rick, thank you. we'll talk to you in a while breadth is good this wednesday morning.

best day for emerging markets since april 6th. wti above 16 we're back in a moment as homes become schools at&t has created

a $10 million dollar fund to support distance learning tools, curriculum and resources to help educators and families keep school in session because the key to keeping kids learning, is keeping kids connected. - [female vo] restaurants are facing a crisis. and they're counting on your takeout and delivery orders to make it through. grubhub. together we can help save the restaurants we love.

finally got a bounce for the first time this week breadth very good as we see earnings better than expected. some progress in the senate. some very large companies raising capital, and minimal macrodata today. we're back in a minute

you should be mad your neighbor always wants to hang out. and you should be mad your smart fridge is unnecessarily complicated. make ice. making ice. but you're not mad because you have e*trade which isn't complicated. their tools make trading quicker and simpler so you can take on the markets with confidence. don't get mad get e*trade and start trading commission free today.

there are real markets and there are not. uso is not the market. real market is halliburton the stock is up. that's what you should be looking at real oil companies and oil service companies. not the uso and futures. they're being manipulated by people who don't know what they're doing and by people who do don't pay attention and stop being freaked out by uso or the futures. >> wen we try to gauge oil's behavior, what are you watching and do we think today's move is all about the tweet? >> no. i watch apache it's one of the worst. i watch occi because it's the

worst. i watch halliburton and chevron. those companies are going along as if oil never went to minus 37 that was obviously the fix was in, and we should not -- remember the futures don't always work right. we always try to ascribe a rationality like the uso it's a broken security that wasn't set up correctly by people who wanted to get something. they traded a billion shares yesterday. people want to make money. you create a facility that makes people lose a lot of money, and -- there's no, like, share god. there's no one like -- there's no bad trade jail. what happens is people create things and lose money and so what i hate it. you hate it. >> today is cme is going to allow listing of negative oil options effective tomorrow >> i think the cme has every right to make a fortune, even if it doesn't help anybody other than cme shareholders. it's america

do i like it if i'm the head of the sec? no, but i'm not. i just observe and wish people wouldn't trade this stuff. >> and routers has an amazing story about all the different places they're looking to store salt caverns in sweden booked up tankers off the coast of california waiting to put this stuff somewhere. >> my wife bought a beach house, and the pool is empty. shoot, maybe we can get some money back from it we bought at the top make some money back i told her i wanted to get married on that nordic american tanker i have the ceo on. i have to tell you that tanker would cost me a fortune now. cheap tore get it on a carnival cruise >> what's tonight? >> probably safer on the -- never mind tonight is market access that's a company that makes so much money and then we have digital realty,

a reit that makes so much money, and then scott sperling. he has got -- he's on a hospital board in boston. and he's also, he knows private industry i think no one can explain better what just happened in the senate and in the congress than he can and when you're throwing around trillions of dollars, sometimes i think it's worth scrutiny, my own opinion. >> yeah. it is a little strange tomorrow we'll watch for action in the house where pelosi says approval is likely >> how about unorthodox? is that any good >> i'm way behind you. i'm always behind you. >> well, all i do is listen to the netflix calls and decide what to do for my life that, study, and listen to netflix calls. those guys are great in my next life, i'm working with them. >> well, you got -- there's no vacation policy. that's one of the benefits

we'll see you tonight. 6:00 p.m. eastern with jim cramer welcome to "squawk on the street." i'm carl quintanilla with sara eisen and david faber. session high was up about 475. some of the earnings are better than expected and you have progress in the senate, and now mnuchin on the tape says he's looking forward to having most if not all of the u.s. economy open later in the summer >> perhaps that's one of the reasons the market is feeling optimistic i'm glad you led with the relief bill almost 500 billion in extra aid to small businesses. this is a global phenomenon. this idea that stimulus and relief is flowing. yes, we're in an unprecedented shutdown of the global economy, but if you look at what's happened in the last 24 hours, besides the senate, south africa, the president there pledging a $26 billion rescue package. south korea having a third

supplementary budget and a $32.4 billion budget mexico with a relief package the stimulus is flowing and coming from fiscal and monetary authorities at lightning speed is this enough to make up for the losses no economist thinks that if you look at some of the market action and why it's been more subdued, mike, than what we saw in the middle of march, even though numbers continue to be worry some, even with seeing the peak in major metropolitan areas, perhaps a lot of the stimulus is washing away the bad news in terms of how the impact is going to be on the markets. >> it's definitely bolstering psychology i think it also pushes against the idea that the market would have to have a series of desperate tantrums to try to get the next phase of stimulus through. you had headlines yesterday that senator mcconnell says not a phase four, maybe state and

local budget gaps turn into a market problem right now it seems as if the stimulus is coming fast enough then there are companies that are at least even though the stakes are not that high in terms of beating the number this quarter, they're able to say this is the base level of earnings of operating performance that we can show in this kind of environment, and i think it's all about what traders and investors feel like focusing on in a given day today after a 5 % pullback in the s&p when the nasdaq stocks took a break the stocks are popping 2 % that's enough to have relief for the moment >> yeah. mike, i wonder -- >> bouncing. >> that's for sure >> sara, i'll let you get to oil. i know that's a big one today. >> absolutely. i was going to say it's helping the mood 27% rise in crude oil. and steve liesman has a closer look at the crash in crude and what it means for the overall economy.

good morning, steve. >> good morning, sara. prices are back a bit. the overall decline in oil prices is going to be felt far and wide in the u.s. economy both nationally and specifically at the state level where the states are the biggest in the biggest oil producing states we produce so much oil now that it's not clear like it once was that low oil prices are a net positive for the u.s. economy. now, we've seen big swings in oil prices before back in 1995 -- sorry, '98, but never when the u.s. was the world's largest producer now around 12 million barrels a day. of all the industries affected here, it's hardest to think about oil production going pack to where it was once this crisis passes that's going to have implications for the return to the growth level nationally the industry has been a major source of capital spending for the whole economy selectively in states it's a big source of jobs, investment and tax revenues the biggest producer by state,

texas, obviously maybe the least worrisome it has the most enters economy. oklahoma, alaska perhaps are the ones that might be hit the hardest, especially when it comes to jobs and revenue. if you look at the jobs picture, texas leading. california also with a big presence when it comes to oil jobs louisiana and the new one there, well, not that new now, but it was new back then, pennsylvania. so two deflationary i'm pulses from this. one from lower prices. the other from lost jobs and spending power and declining cap ex the energy industry is facing tough times ahead. we're likely to see a wave of bankruptcies in the sector along with job losses. president trump has talked about helping the oil business federal reserve might be able to step in in some way as well. the question is whether it makes sense long-term in the future with where the u.s. has relatively expensive oil for it

to be the producer choices between a smaller industry, or dare i say, some storm of more permanent cooperation between opec, russia, and the united states. >> that's what i was going to ask. with the president expressing so much support for the u.s. oil industry saying he directed the treasury and the energy department to do something about it, i'm wondering what he can possibly do about it, if anything >> i'm old enough to have pumped gas in two oil surnls in the 70s. the idea that the president would have taken any action to actually raise the price of oil might have launched impeachment proceedings right then and there. it shows you how much the politics have changed, how much the economics have changed that the president is even talking about this i have no idea how far he'll go. he did boast about making an agreement between saudi arabia

and russia to raise the oil price which he couched in terms of saving the u.s. oil industry. it's something worth saving, but the change in the general sense of oil prices being good or bad for the u.s. economy is as dramatic as i can ever remember. >> steve liesman, thank you. let's turn back to the broader markets with energy leading the s&p but every sector higher joining us is the chief investment officer for citi and ben mandel, strategist at jpmorgan which headlines or fundamental drivers are behind some of the action we're seeing day today this week? >> well, the economy and markets are basically along for the ride here, because they're being sandwiched between news about reopening theeconomy and the virus spread itself on one hand, and the policy response on the other. and so that's unleashed this

massive confidence interval around what are the dynamic of earnings for 2020. some of the headlines pertain o to consensus earnings for s&p were down 5% a week ago now they look like more 15% and may well end up at negative 25%. that's the risk premium associated with that uncertainty. and, of course, what multiple do you ascribe to earnings when rates are so low i think in terms of how we're treating that is we're coming from a relatively cautious stance in our portfolios but the tone has changed a lot over the past few weeks where we're thinking more about buying on weakness rather than selling on strength, and thinking about the broadening policy backdrop as being supportive of both credit and equity in roughly equal measure. we're more diversified in the way we're taking risks right now. >> david, what about you guys at

citi private back? what are you thinking about what to do with the markets and the disconnect we've seen with earnings and the economy and the financial markets? >> well, we've projected earnings down significantly, probably by 25% for this year or more and we think the analyst estimates are very, very high. when we think about the recovery and specifically the risks associated with what's going to happen with the virus, we're sort of thinking about the vaccine as the end of this if the vaccine is available in 18 to 24 months, what's going to happen between now and then? and what's going to happen is that there's a group of people of 50 and over who are going to be restricted in the activity levels and their willingness to go outside and their electricalness to go back to work and willingness to spend. there are a lot of breakes that can be put on the economy that are related to the health event, and not to the economy and the stimulus taking place. the stimulus only gets us from

here to there. it helps companies survive this time and helps individuals replace their income but it does not provide stimulus in the sense of extra stimulus to get the economy necessarily back on track. it's what i describe as survival capital. and so when you think about the limitations on people 50 and above in this environment, the limitations that -- in terms of the real stimulus being used, you can't be overly optimistic about where the economy is going in the near term when we get out 18 months from now, then you can imagine a very different scenario, a real acceleration that takes place once we know the health crisis has passed we're looking at investing with companies where the strong are getting stronger those with strong balance sheets and strong competitive positions, those that can keep investing over the course of the next several years where others can't. we think there's a group of companies that will be beneficiaries from this in the equity market and those are the places we're putting our client's capital now

>> what's your best assessment of what is priced into markets in terms of the pace of when economic activity comes back to something that looks like the precrisis normal i mean, you have earnings as we've been talking about down 15% to 20 %. the s&p is down 15% to 20% and the cyclical parts of the market are down more. what's priced in and how high are the stakes >> markets are going to move faster than the economy. you saw that back in the financial crisis a decade ago where markets bottomed two months ahead of one earnings estimates bottomed for the s&p i think that's telling you that it's keying off of expectations which have been gradually finding a floor and we think they will over the next month or two, and that the policy support is palpable here policy both fiscal and monetary

have put out a series of fires first it was market functioning that the fed took care of. small business solvency which the ppp is geared toward acute labor market stress. there's a question of what happens when energy companies come under stress because of the oil price? well, there are policy solutions for that as well including potential expansion of liquidity backstops for credit markets that are geared to that. and so i was kind of -- i was -- i've been taken by comments by the fed over the last two weeks, the moral hazard is not a concern, and they're willing to backstop a broader array of companies than you would have seen previously. i think the backstop continues to expand. that helps drive a positive fundamental. >> david, what about a backstop potentially for the u.s. energy industry is that something you'd be willing to place a bet on? >> well, i don't think of myself

to be in the place of placing bets i think it's possible there could be aid specifically for that industry as there was for the airlines the question is will it take place? we're more skeptical about that because of the -- whether or not airlines are clearly more essential to the recovery than the energy sector and the energy sector can recycle and go through bankruptcies and restructuring. it would be done as a political gesture, but it's not something i'm betting on i think one can look at the next year and given the economic outlook imagine that oil prices are higher a year from now, because of the shutdown of rigs and rig counts both here and abroad, and that that alone could see prices normalize but before we even got into this crisis, we're seeing a 1% to 1.5% energy decline because of more efficiency and the replacement of oil and natural

gas with alternative energy sources. so we can see a recovery on that basis. i think it's an interesting place to invest whether or not the government steps in with support programs >> david, ben, thank you both for joining us >> thank you for having me we're going to continue that discussion about oil in a little bit with billionaire harold hamm stay witush for that. back in a minute (soft music)

- [female vo] restaurants are facing a crisis. and they're counting on your takeout and delivery orders to make it through. grubhub. together we can help save the restaurants we love.

more breaking news on mortgages. diana has that for us. good morning >> good morning. a major break from the fhfa regarding loans sold to fannie mae and freddie mac. it will buy mortgages that went into forbearance after they closed that's the government's program which allows borrows hit by covid-19 to miss mortgage payments they stopped doing that. that froze up the credit market and made it more difficult to get a loan, because most lenders sell their loans either to fannie mae, freddie mac. they were worried they were going to be stuck with some of the loans. they will buy the loans that meet specific criteria for a limited period of time that is up to may 31st the say the loans must have closed on or before february 1st

and no cashout refies on this and the loan cannot be more than 30 days delinquent the fhfa regulator said we're focussed on keeping the mortgage market working during these challenging times. purchases of these loans will allow originators to keep lending. there will be a price premium on this for the lenders 5% for first-time home buyers and 7% for nonfirst time home buyers it may increase the rates on the loans because they're more expensive, but it will open up the credit box a little bit which had tightened up substantially over the last several weeks. >> all right that's important for people who need some credit related to housing. diana, thank you our next guest has launched a coronavirus employee assistance fund for the workers while also taking a 25% pay cut

as the commercial real estate industry continues to feel the impact of covid-19 joining us on the phone on the path forward is brett white. it's good to have you back >> good morning. thank you. >> i want to get this to checklist you've assembled you call it the safe six which is essentially various steps that tenants need or any employer needs to bring people back i'm assuming you've employed this in some areas around the world where they're a little ahead of us? >> we have i mentioned a couple days ago we have the benefit of having moved almost a million people back into offices in china the last six weeks. from that experience, we put together an extensive technical manual, almost 300 pages that lets companies both tenants a

owners look through every step that's required to put people back to work this safe six graphic we use around the company is really just a very simple visual that talks about the primary pillars of putting folks back to work. to give you a sense, carl, for the appetite out in the market right now to try and figure out how we put people back into offices safely, we hosted a web cast yesterday to roll out this manual we expected a few hundred participants we had 12,000 people dial in from 8,000 different companies for an hour to learn how to actually implement this manual across their footprint >> wow i'm looking at it right now. a lot of it is about communicating to workers, preparing the building, but your eye kind of zeros in on this social distancing plan where you're talking about alternating workweeks. you're using previously shared spaces now single occupancy.

how much of the -- what percentage of the prior work force do you expect employers to bring back at any particular time >> so it's a really good question i think there's a lot of dialogue in the marketplace today and over the last few days about how much of a launch will be back in the office the month or month after i think the reason for that dialogue is all of us have now experienced what it's like to work remotely. frankly, i think for many of us, myself included, the technologies we've invested in the last ten years worked so well particularly cloud based systems. they worked so well remotely i think everyone is reconsidering the office and the remote work location as a viable alternative for your work force. now, that having been said, there's been a lot of study done the last week, two weeks, talking to a lot of ceos and cfos about this issue. there was a survey with 317 cfos

this week asking them that very question and i would say the consensus answer is across the board that most of them feel that perhaps 5% of the work force they currently have in the office not print could work remotely. 5% is material not huge, but terl and i think it's indicative of a change in thinking about how we're going to manage and help our employees have a better work experience, be more effective and more efficient >> i'm wondering what kind of pain you're expecting with so many of your tenants, hotels, restaurants, retail, not getting any business right now what kind of defaults are you bracing for? >> you know, it is the right question, and as we look across the tenants we work with and the owners we work with, you can certainly see that across the spectrum of the verticals in commercial real estate, the pain is very different.

retail, there's just a world of hurt right now in the retail space. and i think it's an unknown. how many of the smaller retailers are actually going to survive this down time for many of them, they were living on one month's cash flow and receivables and whether or not they can even come back in a month or two months is an open question office space about 95% of office represents were collected last month. that's a good sign industrial space, we all wish we owned a little bit industrial logistics is hot in commercial real estate for the obvious reasons. there's no doubt there's going to be a lot of pain spread around the commercial real estate universe over the next few months >> what kind of concessions have you been making to some of your tenants? are you giving them relief on rent for what kind of time period >> right what we're seeing in the market police station right now is that many -- place right now is many

landlords are having a proactive conversation with tenants around the lease terms in place most tenants have leases that run five, seven, ten years there's a a little bit on the books as pertains to the lease, and many landlords have said listen, before you get in real trouble, let's have a conversation around what we can do to help you help us and i would say most of the conversations are around a couple areas one is what we call blend and extend if a tenant will extend their lease, that lease payment, that rent rate can be reduced a bit other landlords are offering pure rent abatement for one, two, or three months many offering rent deferrals it's not much different than the multifamily residential states over a much larger group of tenants. >> finally, when it comes to -- there was a great piece in fast company about sort of retail

design whether it's groceries or department stores. i mean, at this point the thinking is they're going to be allowing fewer people at capacity at any given moment i just wonder what that -- are we going to have to get used to the idea of waiting in line to get inside a commercial space for the foreseen future? >> i think it's very possible that you will have to wait in line to access particularly high-rises if you think about midtown high-rise building that perhaps you work in. today or before the pandemic, we arrived at your building, shows our security pass, got in the elevator and went to the office. that's not going to happen going forward. what will happen is health checks in front of a building of some sort. how you get in an elevator, how you board, we're not going to be able to get as many people up as quickly as we did in the past. i think we're going to see lines not just at retail centers but office buildings, restaurants.

there's only so many people we can put into a confined space. you'll see the same thing in office plates where we used to look at density as a real plus as an employer on the office space. now it's the opposite. we're going to have to really open up the offices and provide our employees a safe six feet in every direction for their workstation and wherever they walk in the office >> yeah. i mean, there's wrinkles there that people are not going to think about until the first day they show up for work. it's going to be an education for all of us. brett, thank you great stuff. everybody should take a look at the checklist. appreciate your time >> you bet thank you very much. carl, now time for our etf spotlight. today we're looking at the bio tech sector. ibb. still up for the year. bio gen tumbling despite an earnings beat. the company saying the pandemic

has introduced, quote, potentially unquantity fiable risks. we're going to take a quick commercial break stay with us on "squawk on the street." these days, it's anything but business as usual.

that's why working together is more important than ever. at&t is committed to keeping you connected. so you can keep your patients cared for. your customers served. your students inspired. and your employees closer than ever. our network is resilient. our people are strong. our job is to keep your business connected . it's what we've always done. it's what we'll always do.

featuring the emmy award-winning voice remote. access to your favorite apps, including netflix, prime video, youtube and hulu. all without changing passwords and inputs. the most 4k content and movies and shows on any screen. the best entertainment experience all in one place. good morning speaker nancy pelosi says she expects the house to pass the

latest coronavirus bill tomorrow paving the way for nearly $500 billion in economic relief on nbc's "today show" she discussed what needs to be in the next stimulus bill >> the russians are still at work trying to undermine our election that's why we have to have an important chunk of money in this next bill that will enable us to have -- protect the integrity of our elections as well as enable the american people to vote by mail >> tyson foods is indefinitely suspending operations at the largest pork plant due to worker absen absence. workers have been calling for the facility to be closed because of an outbreak of the virus. iowa's governor feared the shutdown would hurt the food supply >> in madrid, spain's daily death toll falls below 500 that is roughly half of the high

of 950 deaths three weeks ago. a little bit of good news there. as always, you can get more on the coronavirus coverage by heading to cnbc.com. mike, back to you. >> sue, thank you. let's get a check on where we stand in today's markets this morning. a little bit of a bounce s&p down 5%. it's up 1.75 nasdaq leading in small caps

oil numbers just crossing the tape let's get the latest at hq >> the energy department reporting oil inventories are up 15 million barrels in the past week this is even more than the american petroleum institute's report from last night which showed a build of about 13 and a quarter million barrels. demand is has made the oversupply problem more pronounced and the world is literally

running out of physical places to store oil sara, back to you. all right. oil prices up 23%. a little bit off the highs after the break we're going to continue this conversation about oil, energy, and what it means for the u.s. economy continental resources ceo rohald hamm will be with us we'll be right back. you should be mad at forced camaraderie. and you should be mad at tech that makes things worse. but you're not mad, because you have e*trade, who's tech makes life easier by automatically adding technical patterns on charts and helping you understand what they mean. don't get mad. get e*trade's simplified technical analysis.

two top tech stocks would be the surprise winners

more "squawk on the street" coming up.

crude rebounding after hitting record lows. the international benchmark trading around $21 a barrel after losing nearly a quarter of the value in the last week when wti futures went negative for the first time ever. brent crude coming off a low this the trading commissioner chairman called the price fluctuations fundamental >> our main job as a regulator is to make sure what's going on in the markets is reflective of real supply and demand and not anything else. i think when we look at this situation, it does appear to be a fundamental supply and demand issue. >> our next guest is calling for a more extensive investigation into the price moves alleging possible market manipulation, harold hamm joins us now good morning, harold be more specific about what you

believe needs to be investigated here it seems as many obviously there's fundamental pressures on the price, and the cme was clear about the procedures in terms of the prices being able to go negative ahead of this what do you think represents any kind of misconduct here? >> well, i find it highly unusual that for the first time ever in over 60 years that we have any commodity that's traded at a negative. and, you know, it happens with crude oil. so on the day before the last closing day of the month so something went awry i know they put in -- instituted a new computer system. perhaps that's it. i don't know but there's more here at risk than just that i think the very essence of being able to set the calendar month average on the back of this trading volume, you know, i

don't think people can do that in the future. so perhaps going back on that day to a weighted average, the volume traded which was very small volume, there wasn't any buyers why didn't it just go to $40 why didn't it go to $200 it back up and affects the entire prior month so that's what's so disastrous that's why it needs to be looked at >> but isn't it also true that the spot market for some regional grades of crude went negative it does happen when there's no storage and too much supply. >> well, there's a lot of things people can do. it's what producers are doing all over the world today and that's shutting in prur production you don't have to cap wells like the chairman said yesterday. all you do is shut the valve and shut off the flow. that's what people are doing

and that solves the issue. but we have about a 30% negative demand number that everybody is working with and so that's what everybody does they shut in production for that 30% or more. our company is like everybody else so i said it earlier that yeah, you have to pare back. that's what companies are doing all over the world >> you said your company is pretty much like everybody else. so you are cutting back production presumably? and what do prices around these levels mean for your cash flow and finances obviously you as many other producers have debt out there that needs to be serviced? >> we don't have a near-term debt we're servicing our company's in very good shape. we have a strong balance sheet we don't have any near-term issues we're dealing with at all. anyway, this is not the first

time we've seen situations arise like this. we did in 2008, 19 98. we've seen other times in the 70s. so that's what you deal with, and you know, shutting in production, that's nothing new differing from what the chairman said yesterday, nonexpensive process. we're not capping wells. you shut the chokes, and wait a little bit to set your oil >> an adviser and friend of the president, are you advocating for a bailout of your industry >> we're not the president has been very responsive we've had a double whammy. you know, the saudis teamed up with the russians to flood the market, which is i think going to have a very disastrous effect on both of their countries'

economies and leadership so i think that's coming we'll see more on that, but the president was very responsive. we had to stop that. and he stepped up, made a few calls, and intervened quickly to do that. so that went away. so rather than bring a trade action and all those things that take a long time, the president was so responsive, and we appreciate all that he's done. nobody has asked for a bailout that wasn't a bailout. obviously we had foreign countries that were trying to take advantage of what we have going on here. so we've had very good things happen with this energy the last few years. it's a trillion dollar turn around >> right >> instead of buying from foreign countries, we don't have to do that anymore >> right and the president has been protective of that, but it is an important source of investment

and employment and good paying jobs in this country and i'm just wondering if there's going to be a debate, harold, about whether there should be any relief for this industry which has also been fuelled by cheap credit and heavily indebted companies there's a question about throwing bad money after -- good money after bad. >> you're right. we've employed a lot of people still do and we've got service companies. my heart goes out to them right now. we're going to try to keep as many of them in business as we can, but it's very tough on that sector, and that's where a lot of jobs are. so yes, you're exactly right our industry is beleaguered. we hope this don't last a very long time. america needs to go back to work we've got to get the economy going, the band going. our sector can lead all of the

economy back, and so we have to be there to do that. so we'll see as this unfolds, you know, what's necessary for this industry to survive and be strong again >> harold, you mentioned the president's responsiveness, and we saw that enormous squeeze when he admounnounced the possibility of a deal in terms of that historic production cut, and then we got the meeting and the cut and we're visiting the prices because of the futures. i wonder for our viewers when is a reasonable amounnouncement ofa cut, and the reflection in fundamentals >> you're right. those cuts should have happened immediately. some of them held off to may first. that's way too long. all the companies in the u.s., we've been responsive.

we've been shutting in production and you have to do that so that's exactly right. you know, it's -- we kind of do things different going on in the future instead of using the chicago mercantile exchange to set cma, we're going to have to do something different. we've notified our purchasers. we can't use those negatives when you're selling state and federal oil along with royalty interest oil, we can't use negatives. it's got to be based on something totally different. >> i'm going to ask what's going to keep the price from continuing to go negative? and how long it has to be that way for you to actually see an impact on your cost structure and on your actual business from negative prices? >> let's get straight what happened here. those were financial

transactions you know in fact, just allowing people to buy those contracts without the ability to see that oil delivered anywhere, that should be stopped you know that's wrapped up our industry it shouldn't be allowed. it ought to be over. anybody that can't take physical delivery should not be buying the futures. that's hurting our industry. it ought to be stopped a lot of them are drowned. this got them. they made these bets, financial hedges, financial bets on oil prices, and it got them. so a lot of them are gone. so hopefully that won't -- won't have to contend with that in the future it ought to come down to fiscal supply and demand. i think we're at the bottom of this we'll see prices stieabilize an come wpack with demand as it

should >> people being willing to take the risk is why producers hedge. if you sit between producers and physical consumers, the market wouldn't work that well. >> fiscal hedges and what the monthly contracts are, that's a different situation. those are two different things you can still hedge your production in the future i mean, that's what farmers have been doing with wheat for a long time and certainly producer ks do that that's two different things. what we've got going on here, you know, what went on last month that ended up breaking a whole lot of those guys is totally different from the future hedges that basically you're placing with banks and other institutions >> let me let you know what the cme said they have a comment. the continental resources allegations are inaccurate cme group markets worked as

designed we fully prosecute behavior that violates our rules what do you think of that? >> i don't blame them for putting down a statement like that i would too. they're going to be on defensive quick. they've got a lot of explaining to do. >> all right harold, thank you for your time. appreciate it. >> good to be on >> we'll be back after this as we see the markets try to hold here some gains that are partly reversing the losses of the past couple days. some of the worst we've seen this month don't go anywhere. turn on my tv and boom, it's got all my favorite shows right there. i wish my trading platform worked like that. well have you tried thinkorswim? this is totally customizable, so you focus only on what you want. okay, it's got screeners and watchlists. and you can even see how your predictions might affect the value of the stocks you're interested in. now this is what i'm talking about. yeah, it'll free up more time for your... uh, true crime shows? british baking competitions. hm. didn't peg you for a crumpet guy. focus on what matters to you with thinkorswim.

♪

swithout even on yoleaving your house. just keep your phone and switch to xfinity mobile. you can get it by ordering a free sim card online. once you activate, you'll only have to pay for the data you need- starting at just $12 a month. there are no term contracts, no activation fees, and no credit check on the first two lines. get a $50 prepaid card when you switch. it's the most reliable wireless network. and it could save you hundreds. xfinity mobile. welcome back to "squawk on the street." stocks rebounding this morning

led by gains in energy and tech. but consumer staples are lagging though still slightly up symptom of the stocks that have held up pel are underperforming today. finally turning to tyson foods, it's down more than 1 % 1% after indefinitely suspending operations at its largest pork plant due to a virus outbreak and worker outages it's the third to stop operations around 16% of capacity tnku.o yo >>ha you very much we'll take a quick break stay with us (soft music)

- [female vo] restaurants are facing a crisis. and they're counting on your takeout and delivery orders to make it through. grubhub. together we can help save the restaurants we love. 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. hi! because at at&t, we're always committed to keeping you connected.

our next guest is part of the president's economic revie s -- revival council and may see his industry be the first to reopen let's bring in lifetime ceo baram akradi, he owns gyms across many states, including georgia. are you ready to reopen? >> we are ready. we're getting everything ready to make sure we open very, very safely and give the governor the backing he needs to prove that businesses can be responsible and taking care of their employees and their customers. >> when i saw that gyms were on the list of the first businesses to reopen, i was shocked they were among the first businesses that people stayed away from as we were getting into this, because it seems like close quarters, you work out next to people, there's a lot of

sharing of equipment and towels and that sort of thing how do you make it safe? >> so this is a great question and i think it deserves good thought process. you know, i think at this point we need to let the data support the decision making rather than the fear so when you go to the grocery store, you touch something, somebody else comes behind you two minutes later touch that same thing we also know how amazingly contagious this virus is when you look at the data from university, stanford or usc, or you look at the data in iceland, it's also very, very clear that much, much more number of people are already infected with this virus. the denominator has been reported grossly wrong and therefore we have created such an incredible fear amongst america that this is going to hurt everything. the fear is going to be the

biggest part of the challenge for having the economy come back, and america is built on courage and freedom, both of which are under assault right now. >> but that still doesn't -- but people are still going to be scared and this can have very severe consequences, it's more deadly and contagious than the flu, what makes you say people are going to come back even when you do reopen? >> that's the difference it is more contagious. but when you look at 50 to 85 times more people who have infected according to these studies, that says that the denominator is wrong by 50 to 85 times, which means the measure of people dieing from the virus is 50 to 85 times less further more, as we go to the next stages of this period, we have the social distancing, social isolation to give time to the hospitals to get ready to

get more equipment, to understand the virus and understand the level of the spread, the level of spread, while it's not enough to be herd immunity, it is significantly more than we can contain it. i think that fact needs to be broken up, studied, and talked about more clearly the people are going to get this virus over the next year or two, absolutely the people are going to get this virus like we get other colds and flus our immune system is capable of overcoming viruses and bacterias. we live with trillions of bacteria and viruses every day of our lives number one defense is immune system and the gyms, 20, 30 minutes of exercise, getting sun, getting outside, are things that help

immune system. e we're breaking down people's immune system keeping them inside, letting them get depressed, businesses are going bad, depression is setting in, that causes inflammation, that causes a way for viruses to break into your cells. we need to be more rational. i'm not opposed to keeping clubs clean, every employee will have disinfecting materials, as well as rags. we'll spread the people as much as we can. when we open, it is going to be as safe as any other place people have to go to >> i mean, i'm not going to argue with you, i'm not a doctor, i don't know where you're getting the medical information but from what we heard from our nation's top exterts is even in the reopening it's going to be important to social distance, wear masks and take precautions, we're not doing the herd immunity thing

because there could be consequences of that just final word, i'm surprised to hear you argue the science, not more of what you are doing to make sure that people can feel safe, not just that they need to exercise and need to be getting out there. >> so we will do everything that is possible. we have purchased masks for our employees, disposable masks for our customers so they can grab it to go in. we have extra, extra focus on relentless cleaning to make sure the space is spotless. we have sourced materials that will kill the virus within 60 seconds of touching the stuff. we are working day and night to provide a safe place for the people and i'm not arguing with you about facts. i'm arguing with you about the fear the science behind this is the science, and i'm not arguing science. this virus is contagious, and it's so contagious that it's

already been spread. i believe we are fighting this fight in the rear view mirror rather than looking at the facts about how we can reduce pressure on the hospitals, and that is, we need to understand it better. we've taken the time to do so. now we need to equip the consumer, the people, americans, on learn how to fight this disease better on their own. how to improve their immune system and how to do a diagnostic check which we put in our app, you can ask four questions of yourself and find out if you have any symptoms if you have symptoms you need to act early. what we didn't understand early, people went to hospitals, rejected five times and come back when they have to go straight to icu. now i think we can solve the problem with a few hundred dollars worth of drugs better than having them go to icu

so over the next few weeks, as time goes on, more and more path will become clear on how we can have an early attack on the virus when somebody is infected. >> thank you very much, we wish you well good luck with the opening >> thank you. >> operates a number of finantn centers. we'll learn a lot more in the next couple weeks. while you've been talking to him, l brands has been halted for volatility, then opened and halted again as they're seeking to terminate the victoria's secret deal we know what a long standing story this has been as l. brand tries to restructure its business model but that's a fly in the ointment if this is right. >> women's wear daily put out an article saying this deal could be in jeopardy