this becomes more of an old nightmare. i don't think it's going to happen, but you know, that would change my mind and i'm flexible i want to make it clear, the s&p doesn't excite me at this level. but i find individual situations are very attractive. particularly credit. you know, my largest position is a credit position, not an equity position >> i would love to ask you more about that, but we're completely out of time this morning, lee. please come back soon. i would like to hear about that credit position. >> you stay safe and healthy and to your viewers as well. >> thank you, lee. you, too we'll talk to you soon >> folks, that does it for us today. make sure to join us tomorrow. now it's time for "squawk on the street." >> good thursday morning welcome to "squawk on the street." i'm carl quintanilla with jim cramer we're glad to have david faber back after a couple days bulls do hope to add to wednesday's gains, as companies like delta and expedia raise billions in fresh capital.

jobless claims, though, 4.4 million, bringing the total to 26 million over the past five weeks. oil bounces, and the european pmis remain historically low 16 in france no, 10 in france 16 in germany. jim, though, your tone this morning is relatively hopeful. >> look, i am a creature of who reports and what they say. and i can literally -- i find it hard to remember as many companies as saying good things, even as obviously we're in nidest of a pandemic, and i don't think they're all clockeyed optimists. these are large cap companies. these are not the companies that the government is trying to protect. these are arguably the winners the companies that are going to get stronger i listened to lee, and lee cooperman was talking about what it's going to look like on the other side i look at my desk. i have reports everywhere here these are all companies that are

going to come through with fewer competitors. and that may be bad for the u.s. consumer, but it's good for the stock market david, would you please offer some contrary view and say that i'm too optimistic please? >> well, here's one, jim you made this point before on our air, that we cover large public well capitalized companies, and the story coming out of jobless claims today is a small business story it's more difficult for us to cover. it's a little more granular. the data is not as fresh or as high frequency, but you can't look past that >> right let's look at the railroads. the railroads principle enemy are the truckers i think the truckers, the smaller truckers, are going to have a huge amount of problems here the larger ones, no. union pacific is great versus u.p.s. but this is just the battle of titans and when the smoke clears, they're all going to raise rates. there's going to be very little

competition. it's going to be great for these companies. again, it's going to be cataclysmic for people who want to ship, but the big are just getting bigger and the small, well, let's just say they're trying to get a hand out from mnuchin. when they get it, it keeps them open for a little while, but this is the big -- this is the cataclysmic change between companies that have great balance sheets and companies that don't and i see many companies that have great balance sheets, and their stocks are worth owning, which is why we have a higher pe than lee cooperman would normally say we should have because i think these companies are winners. and maybe they shouldn't be and maybe it's not right but they're winners. >> but jim, i'm sure you go through the course of the day and have plenty of people questioning the valuation of the stock market given their expectations for the economy and where we stand, even if things do get better. you only need to listen to the

likes of jon gray this morning, for example, from blackstone, the president of blackstone, which reported earnings. talking about the fact that he doesn't see a vee recovery i think he -- yeah, i think he said it's more like a nike swoosh take a listen and then let's discuss. >> i think we're not in the camp of a v-recovery. we think it feels maybe a little more like a nike swoosh, which somebody gave me that line yesterday. it feels more gradual in nature. and that's because, you know, we don't have sort of a cure-all for this virus right now it's going to take time. we will -- the good news is we seem to be over the hump in terms of the peak in most of the u.s. and europe, and so parts of the economy will start to reopen, but it will happen gradually. it will be in certain sectors, certainly geographies. >> you know, i mean, guys, i

have listened -- we all have interviewed so many leaders of businesses on the course of the program over the last few weeks. so many talking about a recovery like that. one in which they don't expect to see earnings come anywhere near where they were for last year, for at least another two or three years so yes to all of the things you're saying, jim, and then i come back to this idea of what can we really expect in terms of how the market is going to treat valuation, or are we simply in a new world where we're willing to accept multiples which we have never seen before? >> i think this is great and the metaphor jon gray uses is nike let's take it as a double entendre first, yes y don't mind that shape because it does at least indicate there's a pulse second, let's take nike. this is company that went from being zero to 40% direct to the consumer it's not host tooj the mall anymore. it's going higher. it's an international market it sells at 37 times earnings. if it's the only survivor, maybe it should sell at 50 times earnings

there are a lot of things that happen in life that run fair it's unfair nike should go to 50 it could go to 18 because there's a sentimentality about how stocks can't do this well. but if nike wipes out everyone else, nike will have a v-recovery jonathan gray did not say what i most fear, there will be no recovery dr. fauci gave me a no recovery yesterday, in a very nice smile, and he does that thing he said, you know, and this is going to be even worse in the fall, and i'm thinking, well, there goes the nfl then i start thinking, well, nike is doing quite well and i'm watching this thing over the weekend, which is a nike ad. it also happened to be about michael jordan i come back and say nike winner, everyone else loser. everyone and that's what's happening. >> right >> that's a different world. we haven't seen that every small and medium sized business that competes with dollar general may not exist six months from now. does that make dollar general

worth more or less >> i don't know the answer >> i think it makes it worth more >> i mean, there's two things here, jim. one is the difference in the way people in asian markets respond. you heard this in the las vegas sands call last night. they're used to dealing with things in ways we're not nike sells goods more than they sell services. and that's why these pmis today are going to be so important because the effect of the pandemic on services, our economy largely, is going to be reflected in nonmanufacturing indices. not about making sneakers and shoes and clothes. >> but we're not trading hair salons thank heavens we're not because they would trade like oil did on monday this is not a barbershop economy. what this is is an economy of titans and losers. now, we didn't used to have it like that. i think it's terrible. my father was a small businessman. my father's businesswould have been out of business probably

february 22nd. that's how quickly he would have gone under i look at nike and think they just get stronger and stronger and stronger and maybe it's not fair. but you know, do we really sit there and say, you know what, i'm going to buy union pacific, no, it's not fair to buy union pacific. no it's just that they're a survivor, even though they say business is going to be bad next quarter, the fact is union pacific is a winner because there's only a couple of rails and they don't need a bailout. versus i listen to the airlines and i think, you know y would rather be -- i would rather be in a coal car going across the country than i would be in some of these airlines. it's kind of open air, you know, a hopper get some sun bring the coppertone >> the airlines are proving successful in raising capital, not just from the federal government >> but that's what they're ucsisful at. raising money? how about raising customers. >> all right, but yeah

true, but i'm not quite sure how they're supposed to do that in the current environment. >> by making it safe for them to fly. >> okay, and i assume that they will because they are in business to try to make money. >> why, because they wipe the seats down >> yeah, well, they're going to have to do a lot of different things we talked a lot about it with the various executives we'll see whether there's a middle seat for a while, whether there won't be it's unclear exactly what the experience is going to look like they have been able to raise capital. many companies who are in a position to have gone oun and did what they have to do in terms of raising capital there will be plenty who are unable to. expedia this morning, again, at the center of the storm when it comes to travel. the squawk crew talked to barry diller last week they announced that deal they're going to raise $3.2 billion of new capital that's debt, but they raise $1.2 billion from private equity. we're talking about silver lake

stepping in there, getting board seats, a significant stake in expedia. liberty media this morning, i'll be talking to greg next hour they're doing what they call a reattribution, taking live nation and moving it from one entity, the formula one entity, to the siriusent entity. there are companies taking actions, jim, as much as they possibly can to try to strengthen their balance sheets to make it through the problem is we don't know how long we just don't know how long it's going to take and where they have to get to >> if we get an antiviral, we're not going to get a vaccine i'm in the vaccine 2022 committee. if we get an antiviral which makes us feel like this isn't a death sentence, the stocks and the valuations will be justified. we have a few more days before gilead reveals remdesivir. what happens if it's good?

i think what happens is we fly again. >> there's a lot of hope on that, and obviously, that news article are leading some people in that direction. we'll get more on that david mentions media we have a big call on media stocks, evercore goldman goes to a street high on amazon, and a lot more plus, watching the pmis come in ckn mitengg lo ba ia nu

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.

oil prices are building on yesterday's gains, and of course, america's fracking boom is beginning to collapse our brian sullivan has more on that this morning. hey, brian >> hey, carl good morning yeah, i mean, listen, it's funny we're talking about the price of oil soaring, but the price of oil still under $20 a barrel these times are pretty insane. and they are hitting the u.s. fracking industry. and really they're going to start the hit job market as well on a day with the unemployment number coming in the way it did. let's talk about the potential slide. that's the number of new major fracking wells it's the biggest month over month drop in the history of the data set those are new wells, and you can

see a steep drop almost nobody is going to drill a new well now what about existing pruoduction u.s. production falling just about 900,000 barrels a day from last month still at 12.2 million barrels a day, much higher than a few years ago, but down nearly a million. you have rig counts off nearly 500 from last year and you have refineries running at 67% that's a double-edged sword, though, guys, because 67% means that they don't need oil, which means they're going to store it, but still, you're starting to see this one sort of great fracking boom fueled in large part by hard work, sweat, and debt, start to come to a very creaking halt. will it be fast enough to stop oil's slide, i don't know, but it's slowing >> is that wi at the time when the uso and the rookies who traded the uso knocked it down, is that why apache is up

is that why occidental is up, why halliburton is up, why almost oil stock i follow is up, and one is gnaw true is it the oil futures and the uso or is it the oil stocks? >> jim, oh, man. listen, this is a harder question than who should the eagles pick in the third round tonight. right? maybe a linebacker, i don't know >> i think first round they're going to go defense. i do >> think so too. i don't know the answer to that. i'm trying to find out because i can tell you this much, jim. the way the uso has altered its prospectus, nobody is going to buy a one-month contract they decide we're going to change the basis of our investment fund. could you imagine, you know, the qqq deciding, you know what, we're just not going to own microsoft. we're going to buy a bunch of shares of whatever i'm trying to understand that very point >> he did a great job this

morning. i thought you were fabulous on the five this morning. i loved it i thought it was a great analysis congratulations. i'm not kidding. it was really good >> it means a lot because nobody knows more about it than you and i appreciate that. listen, i'm trying to figure it out because there's something funky going on on the tas futures. the short answer is i don't know, but man, i tell you, when somebody figures it out, it's going to be something because there's something weird going on >> well, brian, you're going to find it out before anyone else because you're working 24/7 on it i can't thank you enough for what you're trying to do i go back to david now how are you doing there? >> i'm doing all right, item >> are you >> yeah. i'm going to come over and give you a hawaiian punch >> you know y would take it. anything for some contact would be nice. even if it means a punch in the face from you, jim liberty media this morning, we mentioned it, announces what they're calling a reattribution. they're moving live nation from

formula one to sirius. of course, the atlanta braves, live nation, formula one all of these companies caught to a certain extent in the difficulties we find ourselves in greg maffei is going to join me late toor discuss all of that. we have a lot more "squawk on the street" straight ahead life isn't a straight line.

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gains at the open, adding to yesterday's gains as well, as the picture from corporate america continues to fill in, we'll get to target and unilever and dominos and discover and a lot more when "squawk on the street" continues in a moment.

welcome back to "squawk on the street." time to get in a mad dash. jim's going to cover las vegas sands, the company, of course, reporting earnings, i believe it was after the bell, jim. the china part, of course, which is macao, so important a net loss of $166 million for the first quarter. that compared with a $557 million gain or net income, as we used to call it, a year ago but they're looking to open there. they are opening and the question is will they come

>> there was a really kind of an amazing thing that happened. it's a short seller's nightmare. the other day, las vegas sands suspended its dividend you figure it had to be the worst. last night, they came out and said the pent-up demand for gambling is incredible, so therefore, you have to buy they gave a schedule of debt, and there's no big maturities for a couple years they certainly have the opportunity to make it happen. if you really believe in this, i suggest you thing about wynn mike maddux sent me his health care plan of how to open literally, they're describing about how the air conditioners have to be the gambling companies have really thought a lot about how to entice people in a safe way, and there's also tremendous optimism in china, david this may be one to buy alibaba, frankly. the chinese, they're celebrating as if, you know what, we have conquered a lot. and yes, i know you show the gym that was closed yesterday, the governor of georgia should look at what happened to the gyms

there. there is a notion that while they're not covid-free, they somehow triumphed over covid, and our notion, i think, sorry to be a bearer of what i see is gloom, is we have been beaten by covid. and i think it's a shame that our narrative is so different from theirs. >> yeah. well, there's a larger story there, which is the emergence of china in a way, what the relationship between our countries is going to be like following this, of course, given that their economy is certainly rebounding more quickly than ours is planned to but back to las vegas sands. i mean, macao is closed for a couple weeks in february, but it's not like the traffic came back in any meaningful way in march, jim >> not at all, but this notion of pent-up gambling is interesting because it presumes there's this element of people have not been able to have any vice, but they can't stay away from vice for too long death, taxes, vice i read it, and i say, you know, at least they're optimistic. so if you want to have a kind of

a belief that maybe things can turn around, read the las vegas sands note and you'll have tremendous faith in the ability of people to want to lose money at the table >> okay. we'll do that. are we headed to a break now, guys >> that's up to you, david you have been away for a couple days what do you think, break, no break? it's your call >> no break. no break, jim. we're going to go straight through. yeah carl involved as well. >> if that's the case, we have to talk about lam research there's a company that people are negative on because they can't meet the demand. this is the kind of negativity i'm getting used to. netflix, you know, they had to suppress demand. you know what, when you have too much demand, that's called good. i'm getting angry. >> typically, it is that way >> until here. >> what are you getting angry about? >> fit people are so negative.

david, they ought to just give someone a hug. >> we have 26 million people filing for claims. i mean, we have an employment rate implied at 17 we have companies like target saying that -- >> in the 1930s even - >> target saying their margins are being dinged by the shifts, which are benefitting certain elements of the operation like digital. but that comes with a cost >> target is crushing everybody else and doing at that low prices i'm not saying it's happy days are here again i'm saying that the companies themselves are doing well. the unemployment rate is horrendous and it is 1930s like, and believe me, if they could burn oil like they burned -- like they burned grain under the agricultural act in 1933, they would do it. i'm just saying we do have good unemployment benefits. there are things that are happening that could tide us over, but my main level of optimism has to do with science. i simply do not believe that all these scientists together are going to fail, not in a vaccine, but in something that makes it

so when you get this disease, notice i said when, not if, because it's way too contagious, it will not be ending on a ventilator unless unfortunately you're very, very old. and that makes me more positive. >> and it should and it may be some time. i'm not sure it's not going to be remdesivir, which at least as far as i'm aware, is still going to be used for people in the hospital who are sick. what you're talking about is an antiviral regime you would take much earlier upon getting a test because you have some early symptoms and that would be the end of it. similar to when you feel like you have a flu and call your doctor and get tamiflu >> what do you think about the drug there's good things going on there. i'm following the drugs because it's sodepressing just to follow all the press conferences. >> and you should. i'm in particular touch with one company who i brought on a couple times, ridgeback

biotherapeut biotherapeutics. they're testing right now. >> what's the word >> a couple more weeks on dosing it's all going very well, apparently, from a safety perspective. then they will move on to actual trials and people who have covid, and certainly, the hope is, jim, they could -- that it will be effective. >> only a vaccine could make it so we -- that we could have a world that's somewhat like we used to. i think lee cooperman is right, there will be big changes. if we get a vaccine, david, we will have some degree of normalcy that could prevent social unrest, which could happen eventually if this keeps up >> all right so you're saying everybody is too negative and then you're talking about social unrest? >> because i think the scientists are going to solve it that's it. no, there jobilo wlsless claims horrible, but we don't talk enough about the scientists who are hard at work who may have breakthroughs. >> last week,io were worried about going to walgreens

it sounds like you know something or you're betting on something, maybe it's gilead at the end of the month, but your tone has really changed from just your personal worry about leaving the house, seeing your wife, that was just a few days ago. >> that's correct, carl. that is correct. i do feel better about what gilead is doing. and it's not just -- the trial is going to be revealed soon >> i believe you >> we're anxious to get that next blog post let's get to the opening bell here and take a look at the big board. it's nyse facilities supervisor at the nasdaq, remotely. chief people officer brian smith celebrating, guys. take your daughters and sons to work day, which is today i don't know about you guys. my kids are at work with me. >> well -- >> my kid is teaching english in spain. great place to be right now. she's been out of her apartment. she got out the other day.

got to go to a store six weeks. not bad. what a city to live in, right? >> not bad >> of all the cities to pick to work in. anyway i'm of mixed emotions, carl. some days i get up and i say the jobless claims are awful other days, i hear another hospital chain say good things about remremdesivir, so every d is an up and down day where it's very difficult to try to be even keeled >> yeah. we mentioned target -- >> meanwhile, the s&p is only down -- go ahead, carl sorry. >> sorryerse david the delay is troublesome at times. cornell did talk to becky about the way comps have surged but normalized since the beginning of the quarter digital up 275%. and then the degree to which margins are being affected by apparel markdowns, limits on

foot traffic, and the less profitable digital business. take a listen. >> we went into the month of april, and millions of americans are sheltering at home, and they have heard from public health officials that it's best to try to minimize your time in physical store locations we saw a huge spike in digital comps. for the quarter, we're up over 100%, but in april alone, our digital growth is over 275%. and we have just seen cyber monday occur almost every day, except the volume is twice the size that we normally see on even a cyber monday peak >> jim, some say it shows -- >> brian didn't do it right. >> how profitable digital grocery can be >> brian surprised me. i would have said if i were brian, you know what, we're crushing the competition, but that's not brian's style we are the month of april showed

we are dominant. when the smoke clears, people have changed permanently the way they shop. they love to come to our store this is something that chipotle told me, too they like to call ahead. they like to have the stuff put in their car they like to go home i think brian should have totally told the narrative differently and instead of focusing on margins and apparel which were disappointing, he should have talked about the new way to shop and this is the way people love, but brian was too negative, along with a lot of other people he didn't understand the virtue of his own model, i think, which is he is going to be a winner when the smoke clears, along with costco, along with walmart, i believe maybe lowe's maybe home depot, and there's a goldman sachs piece today, and i thought it was kind of amusing, that the greatness of amazon is not being recognized by the stock pricing. one of the greatest performers of all time. so brian, listen to me brian, too, can you imagine having to tell these ceos, don't you realize you won? i mean, maybe he's from

whitestone, got that queens negative attitude where he's down, you know, you see these queens guys, they come on, they're moody. they're still mad about amazon oh, hi, david. sorry. i forgot >> i am still moody. you're right we grew up in queens in the '70s it definitely shapes your world view what can i tell you? it's just you can't get rid of it but to your point on amazon, by the way, as you said goldman did upgrade it what did they expect get this, they think revenue and profitability is going to be above consensus. that's really a shock for a company whose stock price is up 30% this year and the market cap is now poised to eclipse that of apple's. they're very close in terms of market cap at $1.2 trillion and $1.21 trillion i continue to wonder whether they're going to see - >> i have a pyramid of amazon boxes when i got home. you have to leave them out because of covid, and i came in this morning, i left them out for 24 hours i open it up, and it's like edge

shaving cream that i used to buy at walgreens carl is absolutely right i wouldn't go to walgreens, i would rather take the flat top train across the country than go into a plane and i would rather go to an edge factory than i would go to walgreens. but the things are changing. how people get things are changing and they're not going to go back they're not. which is why small and medium sized business, and i'm not talking about ruth chris, david, needed this money so badly >> no, but you know, to your point on small and medium sized businesses who do represent a significant amount of at least the advertising on amazon, remember, advertising has become a very profitable and important part of their business, not large revenue wise, but large margin wise to a certain extent, and for google and facebook, small and medium sized businesses are not unimportant, jim. >> why is facebook's stock up again? is that the india investment

is that what that is >> i don't know. i don't know >> isn't it a quandary, we had numbers cut facebook, and the stockis now up 12 points what is that about optimism india? >> interesting by the way, heath terry, who made this goldman call on amazon, also said that netflix subs would come in ten plus. of course, netflix even blew away that number, but he had a good call on netflix and he sees 2900 amazon. by the way, you guys see the story about bezos returning to day-to-day management for the first time in years? >> yeah. i thought that was interesting since a lot of us thought at one point he was day-to-day management, but these companies, fang is really -- fang is on fire everyone is sick of fang, except for the apple numbers are cut every day. apple now, the expectations are very, very low and that's the one i think is going to be most important because their numbers cut pretty much every morning

you come in and numbers are cut for apple. >> right but if you have owned any of these stocks, you really have not been hurt by this incredible -- well, i should say it's not as incredible a downdraft anymore with the s&p only down 12.5% for the year, but still -- >> they don't have that much exposure to the service economy, other than be a u.p.s. people are studying at home, and that means they're using google to cheat on their exams, and they're using zoom, and they don't care if it's encrypted or not. i'm on zoom way too much i don't know about you guys. >> it gets a little after a while. yeah >> on webx, david, because you don't trust the chinese? >> that's true y don't and i do webx when it's important, when it's business related, yes otherwise, we're zoom and doing the cocktails and whatever else. it's all right i mean, i wouldn't mind being actually able to clink glasses

with somebody in person, but you do what you can. >> you knowwhat i found out? i'm not as much of an introvert as i thought >> remember just a few weeks ago before covid, you said you didn't like people wow, have you turned around. you called the bottom on that not liking thing >> that's a little hyperbole >> yesterday, he said -- lloyd said he wished someone would have told him back before this happened how happy he actually was at the time. sort of reminds me of contactless pizza deliver a, jim. as dominos now pulls their guide. comps for the quarter up 7.1 versus 1.6 in q-1, even with that kind of bounce, can't really tell you what the rest of the year is going to look like >> you know, the u.s. wasn't perfect. we're going to have domino's tonight. domino's is another way, remember, the millennial way to -- the stock was up 20 yesterday, but anyway, you put

the tip on the actual -- you don't have to -- there's no touch. domino's is no touch david, i know you would say domino's is no taste, and that would be wrong that was the old days when it failed and it's miserable head to head, apples to apples, against cardboard, but that's no longer the case, even though cardboard is tasting better, according to west rock >> yeah. well, i fully expect that that is the case, but as you know, i'm always going to be supportive of local pizza places, never more than now, of course, certainly in new york where there are going to be needed and where they're having such a difficult time. well, so many businesses are having such a difficult time >> can't they do it outside? >> you can you can. >> doordash, uber, whatever? >> you can pizza certainly takeout is a very important part of it, but most restaurants, as you know, can't rely on that alone it's not nearly enough to make it work. >> that's why darden, when it

got that money, olive garden got a fortune, and the stock is up 10 if you got it on the deal, and olive garden, not that we're all going to go to olive garden, but it does represent a great bargain. i'll go with you, david. >> bmo today, upgrades chipotle, darden, brinker, although they continue to point out that fast food, they think, is going to offer the greatest upside as these reopenings sort of roll out around the country >> mcdonald's was up big yesterday, eight points. chipotle call was miraculous chipotle is set up for this. remember, chipotle had food airborne issue skz they have all the things down -- they were like pandemic central. and they are doing so well my hat is off to them. you know, they, too, have a demand problem and they're only a few companies in the world that have demand problems netflix has it, chipotle has it, amazon has it. target before brian talked it down today, target had it. then i started thinking, maybe

target, maybe i'm too bullish on target i have to check in with the ceo. >> are you worried at all about tyson and hormel >> yeah, because my travel trust owns tyson how can that stock be up what a wacko market. their execution problems have been legion and terrible hormel, when they came on, told me not to worry about -- not to worry about the food chain i'm going to bet with them you may not think much of spam, but there are 35 million people headed to the unemployment rolls. spam is always a solution. >> jim, would it surprise you that chipotle told its landlords that it wasn't going to pay them rent, would make it up on the back end but had chosen not to it somewhat surprised me >> you need a real estate trust to pay chipotle to be in their

malls. right now, the only space they're negotiated with is the right to stick a q-tip up your nose, because they need those outdoor spaces i know it's not really a q-tip, it's a swab, but if you listen to the call, you'll hear that the real estate investor trust did not like chipotle, but now they're just grateful, grateful to have chipotle versus epr, which has -- epr is a reit that has cinemas which are not paying their bills. 45% not paying their bills brandywine, a very small reit, the only one i feel people are paying their bills you have to follow the reits because a lot of them, the tenets are just stiffing them. something to watch >> that was my point i mean, i have seen a letter from even chipotle to its landlords saying, you know, we're not going to pay now we'll make it up on the back end, but for now, we're not going to >> they have leverage, david you know who doesn't have

leverage victoria's secret. >> no. >> not a lot of leverage there >> they don't. they don't although it is -- it is important to point out, sure, that the case that sycamore came with to try to break that deal yesterday in delaware, is fairly weak at least some would say of course y don't even know if it's been assigned to a judge there in delaware. but you know, they're saying they're relying on this covenant that says you have to file to your past practices and you didn't do that yeah, of course they didn't do it first of all, in a lot of states, they can't open. secondly, they're trying to conserve as much cash as they can. are they arguing they should have kept the storesope sxn kept their employees employed and blown through all of their cash. it's going to be interesting to see how that actually ends up in terms of when we get a ruling on that, jim, because the legal experts i have spoken to who looked through the case certainly don't think it's

particularly strong. we will see. and they posit this, if in fact they do get out, well then it means that a lot of companies conceivably will be table get out, because it's about past practices. you have to change your past practices when your dealing z something we have never seen before >> if they lose, they could close it tomorrow. they may lose and then close it. not unlike a credit line lending in the 2009 period the ninth largest mortgager in the country that was a subprime mortgage and won by a hedge fund because they lost a big lawsuit, and they closed it the day that they lost it >> that's right. >> yep, they closed it, and then they were done then they declared bankruptcy. >> done. >> yeah. >> so i don't know you can't sell a lot of bras in a mall that's closed just saying. david. just saying. they sell bras that's what they do. bra oriented >> that's the last place i'm going. >> that's the business

guys, dow is up 180. nasdaq, almost 1%. getting some crazy headlines out of boj let's get to rick santelli >> hi, carl. you know f you look at a week to date of ten-year note yields, you can see we have moved up just a little bit. defined by 54 basis points which on an intraday was the low but it was also the all-time low yield. close about a month ago. and if you look at the way we're hovering now, we have given up a couple base points zee breaking news. our april preliminary reads on the market indices sxrk of cour course, the manufacturing pmi is an all-time low. it follow s 38.5 which was an all-time low these are all-time lows to a series that started in april of 2017 not a huge amount of history the service pmi, it's 27 of course, an all-time low if we look at the composite, t putting the two together, it's 27.4, an all-time low.

we can debate as to how much information you're garnering from a coronavirus closed environment. but none the less, we keep track. maybe it will give us clues as to how we start to recover and bounce off some of these levels. let's get back to the market 60 basis points on a ten-year note that settled at 62, so we're down a couple base points. we're actually get agiting a wll bit of flattening. as we hover right here, it looks to me like we're about 39, just under 40, if you take 10s minus 2s we're in the low 30s we shot into the 50s now we hover right below 40. this thing is seeking middle ground here. the long end just finds it hard to grab on and see higher yields, although maybe what's going on in europe eventually will give us higher yields let's turn to europe and look at a 30-year italian toying with 3% that starts in june of 2019. but of course, we know s&p

global is going to take their investment grade rating away most likely tomorrow in the ecb has figured on that, so they made very special rules that will still allow them to lend full collateral on their paper even though it's slipping into junk, and how did that affect the currency let's look quickly from a february 2020 on the euro versus dollar so you can see we have been sliding back down after a lot of volatility. if you pull back to a three-year chart, you can see exactly how weak the euro currency is. carl, jim, david, back to you. >> all right rick, thank you very much. >> jim, i wonder if you think the market is betting that those pmis and claims have bottomed for now at least >> yeah, i think so. i think that when you hear states talking about open up and you see that the curve has been bent in a lot of places, i think there's a sense of not that the worst is over, because dr. fauci told us it wasn't, but that we have reached some level of

normalcy that is not great, but a lot different from where we thought one month ago. remember, one month ago was when the hedge funds gave us a kind of -- we had a couple hedge funds come on and give us a very, very negative view we're a month away from that, and i think we're starting to realize, you know what, the world is not a great place, but it's a world, and that's what i think is being reflected >> with that, 23.6 on the dow. let's get to bob pisani. good morning, bob. >> modest gains but we're sort of stuck in a trading range one month after the new lows we had. take a look at the sectors here. nice to see banks bounce aglittle bit, energy bouncing. a good performer, energy, despite what's going on with the crazy energy staples are lagging a little bit. nice to see some of the other stuff moving up, but today stocks like walmart and clorox, costco, tyson, those guys are sort of hanging back a little

bit. overall, i just want to highlight today, one month from the lows, march 23rd was our bottom there that was 23.37 the close on the s&p. quite a journey since then, since march 23rd effectively, we're up 25% since that bottom on march 23rd. and since april 9th, we have essentially been rage mount. 150 points on the s&p. 2730 to 2880, but that's essentially range bound. a volume has been notably lower. we had the lowest volume in seven weeks. volume trading lower intraday volatility is lower, but the vix is still stuck in the low 40s. the market still seems to see a lot of potential problems out there around the reopening here. stocks by market cap this is very important to point out. this has been a big caporaly i wish we had the s&p 10 because you could see what's really going on here. the s&p 100 is only down 15%

since the february 19th high 500 is down 17 midcap is down 28, and small cap is down 32%. right down the curve there, you can see what's going on. this is what i tell you every day. yesterday, we had 9 out of 10 biggest stocks up up 2% to 7%. when that happens, the whole s&p is going to rise it doesn't matter what everybody else is doing. this has been a big cap rally. every day we tend to look at the companies withdrawing guidance this is a sobering reminder despite all the hoopla and hope that's out there of the companies pulling their guidance unilever, volvo, csx, in the last 24 hours. union pacific pulled the guidance riley automotive boston beer company, net gear, unilever in the netherlands also pulled their guidance we've had furloughs as well in the last 24 hours. expedia is furloughing people. one of the reits out there summit hotels also furloughing

people that's a very easy way to remind yourself what's going on want to know how important that target comment was you heard earlier. first quarter up 100% on digital. april up 275 but they've had that surge in retail comps and the trends are softening. i think we're going to hear from other companies, we've hinted at it from coca-cola, costco, they've said similar things as well back to you. >> all right it's a very long list of pulled guidance, bob. thank you. still to come this morning, the ceo of union pacific on earnings and the impact of covid-19 on the railroad giant don't go anywhere.

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the next hour of sidewalk on the street, liberty's ceo is joining us to talk about the atrix in the movement of their stake from formula 1 to sirius we'll talk about the future of baseball, racing and formula 1, and whether we'll see a concert again in 2020.

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trading. >> the ceo of eli lilly was on he talked about franchises on fire the true listy diabetes franchise was on take a look at what winners winning means. eli lilly has been coming through the period as maybe the best of the pharmas other than j&j. you have to applaud them they're inventing things and coming up with things. they're the reason, again, he's got a drug that's an ra drug he's trying to use for covid-19. someone's going to win someone's going to beat this thing. not in a vaccine form, but in making it so it's more tamiflu like and less scary. eli lilly, potential winner. >> wow your optimism --

>> i'm sorry yes, david >> yeah. i was saying we've never had a vaccine for hiv. obviously it killed millions of people but there is -- >> yes i mean -- >> but there are anti-virals that work. >> vaccines are far away i'm saying one of these things is going to stick at an anti-viral to get people out of the hospital faster in fact that's all i'm saying. but that would be a major change in psychology in this country. if you did not think a death sentence meant going to the hospital the fear level would go down >> it's to be determined the impact on the consumer behavior. jim, dominos tonight >> right contactless. banana peppers hold the cheese. they have a no cheese button that's great for india tomato pie you come over to my house one

day and you'll have it and you'll be one and done you'll never come again, but it's really good >> i'm coming to your house in italy. how about that >> oh, david my olive oil business is jenko, and we're having real good numbers. >> finally, jim -- >> you pick the olives >> i'm here. >> jim, yesterday data truck said if you want some signs there's long-term confidence, let's get the number of 1% moves under 30 for the quarter which is what we have in q1. i wonder if today is the beginning of that. >> i woke up to this must be something wrong. the market doesn't look like it's moving. that's what we want more than anything else in the world we want to get away from a 2008 snier owe where every day we come in and it's down four or five this is a very important day for me it feels like a kind of day we

used to have wouldn't that be something wouldn't it be something if anything was the way it used to be anything anything >> we'll take it as it comes, jim. signs are small for now. we'll hope we'll see you tonight. mad money 6:00 p.m. eastern time with dominos in the meantime, good thursday morning. welcome to "squawk on the street." i'm carl quintanilla with sara eisen and david faber from multiple locations let's get to rick santelli >> many economists and analysts were expecting and looking for a number on 640,000. it follows 765,000 really, 760,000 in the month before that around 800,000 these were the best levels in 13 years. the lowest level since december, but it could be worse. housing has a lot of different

dimensions to it and at least based on current data, that would mean a 15.4 % drop from last month and to really dig down on this number let's aim east and go to diana diana? >> well, rick, this is below the expected number. we were looking for 647,000. we got 627 i want to point out from the start, these numbers are based on signed contracts in march that's opposed to closings which the existing homes numbers are this is much more up to date as to what people were doing in march. we did see the price jump from 310,600 last year to 321,400 y. we're seeing the price stability and even growth. it's new homes we're seeing the month supply jump from a 5 month to 6.4 in march. we got results that said there was an incredibly strong january

and february with new orders up 30%. and in march new ordered dropped 11%. the numbers are right along with expectations one thing that was interesting in pulte's call is we're not seeing the cancellations we might have expected and also the cancellations that we see in the existing market. the people who are out there signing contracts are serious buyers and the cancellation rate really hasn't popped up as much as we might have expected. so again, these are march numbers. they're people out shopping in march. we expect it to get a lot worse in april and may and, in fact, pending sales which were measured by myers research have pending which is more signed contract stuff down 33%. we're going to, again, see the numbers change this is not quite as bad as it could have been in march you know, look to the next month. back to you guys

>> diana, thank you. as we look to the equity market which is showing another day of relative strength, energy at the top of the list in terms of sector performance right now industrials, health care, materials, communication services, discretionary technology all higher. the headline of the day was the jobless claims and another oh historic number in terms of americans filing for unemployment claims last month bringing the toettltal to over 6 million americans, and the sort of putting that next to a market that continues to be resilient and bounce back. carl, it leads to questions. i saw tom lee who has been bullish saying the market bottoms before jobless claims peak we saw that back in the 2007, 2008 recession and early 2000. clearly the market is looking past this dismal economic data and jobless claims is a good sort of more high frequently current indicator of the pain.

looking forward to the bending of the curves and the continued better news hopefully we're going to get on treatments, vaccines, testing, and all the other things that all the resources of america's pharmaceutical industry are working on >> yeah. you look at the way in which the economy has been shut now. obviously for several weeks. the betting is people wonder they wake up in the morning and see dismal data like claims and wonder why the market is up. tom lee's explanation is it will look past the -- any signs that claims will get worse. pmi is another big story today oil demand you have to believe the economy even opens up at the margins, sara, that demand for things like gasoline maybe gets a tiny bit better and that explains directionally the level of the market with the caveat that we're not looking at outsized gains. jim was commenting on the fact that a sub 1% move feels like the old days

>> yeah. normal feels better anything return to normal. we're going to have a lot of expeters to watch. we'll watch what happens in georgia where the president has been critical of the opening of nail salons and bowling alleys as soon as this friday and we'll watch what's happening in europe where we are starting to see manufacturing plants open up from some of the big manufacturers and the auto makers there and whether that might be a better test or litmus paper of whether economies can do this in a social distancing way and to prevent any kind of second wave of the disease when you look at the market, the other thing to keep in mind, carl, in terms of the resilience and the lack of huge moves that we saw about a month ago is how much stimulus has flowed i make this point every day. it really is tremendous, and the speed at which that stimulus has been passed either from the fiscal side, and i'm not just talking about the u.s. or from the monetary side from the federal reserve. a headline just crossed from the nikkei in japan that the bank of

japan is looking at unlimited bond purchases which is -- it's a crazy thought. i mean, japan already, the bank of japan already owns such a sizable chunk of the bond market, but the all-in nature and the fact that markets appear to be relatively responsive to headlines like that. even japan which has been throwing it all in for the last few years or so. >> absolutely. absolutely >> $8 trillion in global stimulus so far. that headline from nikkei was breathtaking along with the fact, sara that the ecb is agreeing to take below investment grade debt as collateral our federal reserve buying junk bod etf. we're seeing central banks open up in ways we've never seen before, and that's one reason why people are skittish, because of mission creep for lack of a better word. what else might they do down the road if necessity raises its

head >> the central bankers, they can be creative when it comes to pulling rabbits out of a hat and fighting this crisis did you notice the latest gallop poll showed that jerome powell had a higher favorable rating than the president or secretary mnuchin. i think the only one with a more favorable reading was the governors in terms of managing this crisis. that's not typical to see that kind of level of popularity or confidence in the federal reserve. haven't seen those levels since green span in 2004 the fed the usually not the most popular. but we've seen this federal reserve and one criticized by the president long before this crisis really jump into action and it has stabilized the bond market a bit i think the question is the reopening of the economy and how much time has the fed and the fiscal authorities actually bought before we can get back to normal and just what that's going to look like, the new

normal, how quick it's going to happen how much income is going to be lost with the job numbers today devastating, again, i want to talk more about the market and what investors should be doing with all this information. joining us is richard bernstein, and jeff mortimer. jeff, how do you make sense of the market moves we see on days like today the incredible resilience in the face of shockingly terrible economic data. >> well, sara, i think you hit upon it earlier. markets, i always like to see these numbers print, and then i take more -- i concentrate more on how markets react to the numbers to see what is, in fact, priced in. it's clear in over the -- you mentioned 26 million and counting and yet, markets since the release of that data continue to digest them well, showing you that that bad news was already anticipated. that's why we drew down 35% from

the high, and why we sit at these levels today but markets to me digesting not only numbers like this but digesting the pmi numbers today. digesting the earnings numbers today, and understand that to be bearish, you're looking at the present and the past in order to be bullish, you must took to the future the markets bend the curve and for all those things that are treatments or eventually a vaccine and they're going to price themselves it can look odd in realtime if you don't understand how markets work, but once you do, and you mentioned tom lee and others once you understand how they work, you see markets are pricing in a better future we may not know that future, but it's interesting markets are fairly good at getting the turning points and they don't look for better, good they look for better or worse. that's what markets are doing. they're trying to point that

inflection point >> and i wonder, jeff, if in that better or worse picture, the jobless claims not more than 6 million like we saw last week, but more than 4 million which is still unthinkable. appear to be getting somewhat better i just wonder, though, if it's overly optimistic given the future that we are looking at, even if we start reopening this economy, how much demand is really going to come back? >> so that is all true right? markets may have overshot in the short run, perhaps, off the low. you know, the past 20 days have been historic. near historic in their power only the march 9th low, march 9th of 2009 is a better 20-day period. so yes, there may be some digestion in here from the gains, but if you look back historically at those broad-based moves, those very good 20-day moves that if you get out six months, 12 months,

18 months, it's positive for markets overall even from this point. it doesn't mean we don't vacillate in here. but it does speak well for clients that can sort of take out their timer and get out at least six months, 12 months or so better times should be coming. that's what the market seems to be signaling to me >> dan, how are you guys thinking about it at bernstein advisers and what would you tell investors to do at this point with the incoming data and the fact that the market has been so resilient? >> the reason the market is going up in the face of this horrific data is right now there's a general recognition kind of what jeff was alluding to there's a general recognition the economy globally is operating as close to zero as it can. therefore, no matter how bad that number is, it's telling you what you know. at this point, i think the market cares less about the

magnitude of the prints you're gutting and george h.w. bush getting and more about duration. on focusing on the numbers, the incremental news has been positive in terms of slowing cases, the models pointing toward further slowing cases the mass amount of stimulus and hope for new drugs and new tests. that stuff has been incrementally positive i'd like to key in on one thing that jeff mentioned where we may differ a little bit on the take of what you said, but he said the market cares less about the salut absolutes about good or good and more the better or worse i agree. our view, though, right now is anything you're looking at that's telling you the direction of where things are going, whether you look at the monthly indicators or the weekly indicators, everything is crashing to the downside so in our view, focusing just on

jobless claims doesn't make a lot of sense to me i look at everything look at the pmi numbers today. importantly, jobless claims did bottom after or peak after the bottom of the last market. ism and pmi bottomed before. those things are all still crashing down to the downside, and so i think that while things are getting worse, you still want to be able to be more defensively positioned, especially with the rally and look for things to get a little bit better before you want to actually get more bullish. >> what -- how would you define defensively positioned what sort of sectors and stocks? >> right now we've been sort of going into this and remain more on the defensive side. our biggest overweights have been health care, staples, utilities and we have a huge higher quality investments and diversificatio diversifications we've held gold against equity

volatility i think it all makes sense if you're going to take risk and -- in the portfolio. do it so the risk/reward is better than buying random cyclical stocks. buy where if you see signs are getting less bad, what are the things that are going to outperform during that period? i think it's too early to make big bets in the area, but if you're going to look for the bets, look for the ones that are highly leveraged to the up side. >> quickly, jeff, what's your strategy in terms of sector selection and what kind of stocks you want to be in right now? >> well, i don't know individual sectors unless it's allocated within our firm. i think playing sectors which benefit from the new normal. our committee is looking at different themes and even work from home. you know, try to invest in names and companies that will benefit

from the new normal, and stay away from those which are sort of yesterday, perhaps even yesterday's winners. that's my broad base i mean, work from home, semi conductors, those types of names where they will benefit from the new normal and it will be a staged new normal and eventually we'll be adding a new normal, and i think there will be permanent change to our economy and try to look for firms that benefit from that and have the ability to change and benefit from that. >> thank you both. >> thank you well, when we come back on the other side of the break, we'll be joined by the ceo of liberty media. they're doing a reattributing.

'lexplain when he joins us next announcing a reattribution

their interest in live nation, the big concert promoting company and other assets and liabilities. they're moving one, that is the live nation stake from formula 1

group to sirius xm group what does it mean? typically liberty can be somewhat complex in terms of when it does these hings, the company's ceo can explain it for us nice to have you joining us on the phone this morning, gregg. thank you. >> i want to get to all your businesses first, explain to our viewers why liberty media is doing this so-called reattribution. >> well, i think there are several benefits first and foremost, we always thought that live nation and sirius xm stake were aligned and putting them together made sense. and the opportunity to both strengthen the formula 1 balance sheet and use the strong balance

sheet at xm to take advantage at live were attractive we end up with a stronger formula 1 and a liberty sir sirius with an ability to benefit from the interest in live nation. >> does it also improve their balance sheets in some fashion or at least prepare them better for the futures that certainly remains very uncertain for either business? >> absolutely. in the case of formula 1 there's uncertainty about the number of races we'll have this year and how much support we'll need to provide for the eco system of formula 1, we're clearing off and moving 1.3 billion of debt at the parent level and adding quite a lot of cash. we strengthened the f1 balance sheet, and the balance sheet

above it in the case of lsxm, the holding companies have a strong balance sheet, and they're able to take advantage of the opportunities of live nation which has volatility and has risk. that stock has moved and gyrated from a high of having over 76 in january down to a low of 24 and rebounded below 30s and now it's in the mid 30s there's a lot of volatility there, but there's also opportunity. and liberty sirius has the strength to take advantage and it fits better over the longer term with the sirius business. >> let's talk about a number of the businesses let's start with sirius. it would seem to be fairly well-positioned but people may not be driving quite as much right now. and i wonder, are you seeing any weakness in people's ability to pay their monthly bill

>> so far sirius has not experienced that issue dramatically, but i suspect that there will be stresses on some of that over time, but the sirius business is very strong subscription business is a portfolio that includes charter or the gci, the cable business in alaska. and sirius tend to do very well in these kind of periods and i think that sirius will have a very strong cash flow despite slower new car sales and the like through 2020. >> slowing new car sales could be a key point as well, but you're not concerned at this point. you are still chairman of the company, of course >> i am still chairman you're always worried in these kind of environments, but i think sirius has a very strong business lots of liquidity.

a $1.7 million undrawn line. drawing cash flow. and you worry about it and you're fearful of your customers and their pain, but i think that business is very strong. >> all right let's talk about live nation the stock of which is up 10% it's responding positively to the decision to reattribute. when do you see the company being able to return to business forget normalcy. have a concert held somewhere. >> look, i think live nation is -- has the benefit of being very flexible on a global basis about where it will start concerts there is both an enormous demand they put tickets on sale in the last couple of weeks for concerts in september, and they've sold out quickly they've in finland, norway, australia and paris. there's demand among consumers and there's supply there are artists who want to

tour the most important thing is rightly getting the health question, and i think you're seeing generally in the western european countries and asian countries plans now which include no large scale events into q3 but the beginning of smaller scale kind of concerts potentially, and then larger scale events thereafter. probably the biggest challenge for live nation is uncertainty, and frankly things like the united states where there's the host of regulations about what in the 50 states about what clears phase one and phase two or all those things are probably more difficult than where they're getting more transparency and certainties in other countries on a national basis. but they have flexibility to run their business where if they can open in seoul, korea, or they can open in some spot, they can start touring there. it's a global business that has the benefit of being

able to shift both -- those artists to where they can open >> that makes sense. you mentioned uncertainty. we've never faced anything like this in our lifetimes. we don't know. we have no idea if we're going to be in a much better position come the fall or face what some people are concerned will be a second wave. do you feel as though the companies in your broader portfolio are well-capitalized to withstand whatever is coming? is there going to be another plan you guys have that you would roll out come the end of the year if things are not as good as we hope they will be by then >> i think our companies are well-capitalized we took steps today, and this reattribution to strengthen the capitalization of some, and allow others to profit from the volatility i think we're trying to do it in both i believe we're well capitalized and through this process adding

$750 million of equity to the group and we're going to be stronger once the reattribution and subsequent rights offerings are completed in early june. >> let's talk formula 1 for a moment as well of course, 1.4 billion going over there other as sets as well. where do we stand on the season right now? you have scenarios for no races, for as many as 15 to 18 with potentially no fans. what do you think is most likely in terms of the resuming of racing? >> you're right, david, and the teams have run scenarios from no races to 15 to 18. i think the most likely is we probably begin somewhere in western europe with no fans. that is obviously a good way to start for the safety of the

teams and for the safety of the fans it's probably less attractive both economically for formula but perhaps more importantly for our teams. because the teams really need to see profits from us so they can afford to keep themselves running. they really get a share of the profits to the degree we were running low or no profit races, it may not be sufficient capital to keep them going we're trying to balance the needs for fans obviously first and foremost, the safety of fans and teams, but also how do we run races which are economically attractive not only for form 1 but for the teams themselves and they are working on that i suspect it starts with a western european start with no fans >> i can imagine given how sports starved everybody is there may be opportunities if you can get these guys if their cars to access audiences that have not typically been available to you >> i think you're right. there's enormous demand, and

norm la 1 -- formula 1 has the benefit of being the fastest growing sport on social media and the benefit of expanding the interest widely from things like the netflix series drive to survive which have really expanded and in the time of no sports, i think they're getting more attention people are starved and i think when we do open up, we're going to see a lot of increased interest in formula 1. >> greg, if it was a typical world, you and i might be trading barbs about the braves and the mets you typicallywin that argument are we going to have a baseball season this year >> well, it's an uncertain question like many of the questions. but the commissioner believes there will be baseball that the real question is will we have enough games to have a full credible season that allows us to have a credible, produced

winners of divisions and the like and have an incredible off season baseball is looking at a lot of options. many of those reported in the press. that's the arizona bubble. but a lot of those haven't been reported and i think they're thinking thoughtfully first about the health of the players and then obviously second to help the fans. if baseball does resume, it's most likely to resume as i talked about with formula one with the teams most likely to resume first with players only and no fans present. but there's -- and things like the arizona bubble have been reported, as i said, but there's a high threshold to make those things work in terms of getting people there and maintaining the health, and that's first and foremost is the safety of the players, and obviously the safety of any fans if they participate is baseball's first goal but there's obviously a lot of pent up demand for baseball as well nothing says america is working better than baseball starting up

again. >> no doubt. >> it's fire against safety is the key. >> right many of us would love to see a game on. particularly now i wonder how is the team positioned to withstand that do you stop paying players and i wonder about espn, not anything to do with you, but how do they keep getting paid if they can't air live sports >> i think they're going to be -- there are going to be a lot of challenges to linear television during this time that are only exacerbated as we don't have live sports you've seen the trend around netflix and the like growth of ott. that probably is going to put a lot of pressure on linear television you know, we're lucky that we're less exposed to those risks. we did things like starz several years ago and we've concentrated

on businesses like formula 1 but also like sirius xm, and there has been enormous demand for sirius xm programming. things like howard stern's interview with tom brady got massive play i think our programming is what people want in this time, and the strength of sirius xm's business is showing through. >> greg, i'm going to leave it there for now. so many other things to discuss with you happy we had a chance to hit a few of them, and i hope you'll join me again soon thank you. >> thank you, david. thanks for letting us come on. >> absolutely. the ceo of liberty media dow is up 300 points as we get 1% gains all around the world in germany, france, and oil on the june contract trying to get back to 18 this we're back in a moment

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let's get the latest on the covid-19 with sue herera >> good morning, everyone. an initial study of covid-19 hospital patients shows more than 1 in 5 died researchers looked at 5700 patients in the new york area. 88% of those put on ventilators did not recover. this is believed to be the first large-scale study of coronavirus patients in the u.s. the world health organization is warning countries not to let up on virus restrictions saying the pandemic is far from over the group estimates up to half of all coronavirus deaths across europe are in long-term care

facilities one top w.h.o. official calls it an unimaginable tragedy. >> this pandemic has shone spotlight on the underdeveloped parts of the society long term care has often been neglected. but it should not be this way. >> and on a happier note, in turkey two health care workers postponed their wedding ceremony due to coronavirus the couple finally decided to go ahead and tie the knot wearing personal protective suits instead of a gown and tux. they were accompanied by only two witnesses, but one they will remember, certainly. we wish them all the best. as always, for more on our coronavirus coverage, go to cnbc.com sara, back to you. >> all right sue, thank you time for our etf spotlight. today retail it's raising this morning, down more than 25% for the year

one notable decline in the retail world is target it's moving low heer after sayi it's hurt by higher costs. digital increased in the wake of covid-19 it was really a mixed bag. food did well. discretionary items like apparel falling 40%. investors were expecting better sales. we'll take a quick break the dow is up 1.5% we'll be right back.

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4 .4 million americans filing for unemployment claims last week going into our fifth week of these sky high numbers our senior economics reporter steve liesman has more on how we

should think about the unemployment which continues to pile up at an alarming rate. >> yeah. sara, you're right these numbersare extraordinary no matter how you look at them the 4 .4 million would be six times the worst week in the '08, '09 crisis look at the claims by numbers. 4 .4 million that is down 800,000 from the prior week add up the five weeks since it began. 26.4 million that's a percent of the -- that's 16% maybe that's kind of sort of a proxy for where the unemployment rate would be right now if all of these claims ended up being on the -- counted in the unemployment numbers of. that's the numbers let's talk about the human drama. what is in this claim here what do you look for well, obviously it's a job loss. that's a human tragedy also measuring the state's abilities to process claims.

we'll see show you data on that in a second. it's the number potentially receiving aid to get through this terrible period finally, the bigger this number is, the more work we need to do to get out of the hole that has been dug because of the isolation. what we've been able to do at cnbc on a quick basis, calculate the state numbers. we've added it up over the past five weeks and looked at right now the biggest states what you see is that california by far leading with 3.4 million claims over the five weeks and the rest of the big states, pennsylvania, new york, texas in that 1.3, 1.4 range. that only tells you how many people filed for claims. but what about how many people are in the work force there? that's the next chart we can show you again, pennsylvania, now pleasuyou ca see this as it's terrible in

pennsylvania another situation is perhaps they're doing a better job processing claims. but 23% of the work force. call it 1 in 4 of workers there has filed for unemployment claims one out of five in georgia california, 17%. going down to florida and texas, sara, they've been able to do a decent job forecasting the claims through two ways. they're modelling google searches for unemployment benefits and also following four states that are reporting daily. >> steve, how do you think about whether the fiscal response and also extraordinary amount of stimulus we're seeing happen in relatively quick time, how much of it is filling this income hole i think it's why we report and you and others have been reporting so much on the ppp program, the stimulus for small business, and the technical issues, because obviously this money is needed quickly to prevent business failures and mitigate the unemployment numbers. how much is it helps

>> we don't know the only thing we can report is on an anecdotal basis. one the money is delayed it hasn't got on out to a lot of businesses that need it. in some cases it's gone to the largest businesses, not the smallest the largest who may or may not need it. the smallest who do. the other problem is that in some cases, i don't know, 60% of states, the unemployment benefit is higher than the average wage. so there is not necessarily an inseptemberive for -- incentive for workers to come back to work there's to work for them in some cases. we're trying to monitor that, and we don't know how much that ppp program is going to be able to suppress the unemployment rate >> yeah, steve i do know some business owners who have received aid through ppp, and whose workers still say

they can, indeed, make more money off filing for unemployment insurance we'll see how that pans out. in the meantime, session highs dow is up 375 here as we look for gains for the week we'll talk about whethere n positive for the week so far. we're back in a minute

zblrt for the latest on the economy and how the oil market plunge could play a crucial

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the guidance on those small business relief loans continues to evolve. let's get more on that with eamon javers this morning. >> that's right. the treasury department issuing new guidance within the past couple minutes this is designed to respond to the complaints that too many large public companies have gotten access to the ppp small business funding they're posting a series of questions and answers. one of the questions the treasurety ri has is do businesses -- qualify for a ppp loan and what the treasury says here in response is any borrower that applied for a ppp loan may 7th made the certification in good

faith. they have to certify they're adverse ri adversely impacted or think they will be. they're saying it's unlikely a public company with substantial market value and access to capital markets will be able to make the required certification in good faith and such a company should be prepared to demonstrate to the sba upon request the basis for the certification. carl and sara, what they're saying here is the sba might come calling and ask the companies to prove their certification that they are, in fact, adversely impacted and don't have other sources of liquidity. >> getting stricter. eamon, thank you we talked a lot about how states and local bungts are being strained by fighting the pandemic the collapsing price of oil could also be a body blow to states that depend on oil production thousands of jobs and billions of dollars in tax revenue are at stake here scott joins us live with that story. good morning >> good morning.

a one, two punch to continue your metaphor. the basing math is cruel, if you think about it for most in the oil business, producing a barrel of oil right now is a losing proposition. that flows right through to the states, and you can see it among other ways, in severance taxes. it's based on the value of the oil. this is big money. 5.8 billion in texas that's about 5% of the state's operating budget revenues. in north dakota, 2 .6 billion, or 8% of revenues. in new mexico 1.5 billion, or 6 %. in alaska oil and gas production taxes account for about half of the state's tax revenues the ceo of one independent oil company in texas in this business for 35 years says he's seen a lot of oil shocks, but nothing quite like this. >> there will be hundreds of thousands of high paying jobs that evaporate the question is will they ever

come back? but secondly, you'll see -- i think you'll see half the number of companies in this industry two years from now >> interestingly, frank of loan star resources is smart right now. he hedged his company's productions for the next couple years for above $50 a barrel the taxes are levied based on the price of oil at the well head that leads to an interesting calculation. if prices continue to go negative as they did last week, how do you figure the taxes? these states are all trying to redo the budget projections right now and trying to figure out how this is going to work. i'm talking about severance taxes let alone the job losses and everything else associated with the plunging price of oil >> i think texas was in the top three states filing unemployment claims last week scott, thank you we're looking at a market that's holding in at 1.5%.

10 of 11 sectors stronger. the exception is utilities a quick break. stay with us as homes become schools at&t has created

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featuring the emmy award-winning voice remote. all the apps you love, including netflix, prime video, youtube and hulu. and the most 4k content. the best entertainment experience all in one place. . rails are a very big story today. shares are doing pretty well we bring in morgan brennan with a very special guest hey, morgan. >> hey, carl that's right union pacific's ceo chairman and president lance fritz, as that stock actually jumps about 7% on better than expected first quarter earnings lance, thank for being with us this morning. >> thanks for having me, morgan. it's a pleasure to join you. >> so as i mepsd the stronger than expected results for the first three months of 2020 you

said you expect volumes to fall 25% in the current quarter year on year given in what we're seeing in terms of this economic downturn, how are you navigating, and how is precision scheduled railroading, a transformational trend across north america playing a role in helping you get through this >> well, you're spot on, morgan. we did have an excellent first quarter and it's such a surreal environment where we can put up numbers like that. we had down volume, about 7%, but we grew praigt income about 9%, increased cash generation by 10% and improved our operating ratio to a record 59%. you know, put that in context, that gives us a lot of confidence that tells us what we're doing with psr is creating a more efficient, much more reliable, better service product then at the tail end of the first quarter we started seeing

the dramatic impact of our reaction in the united states to the covid-19 pandemic, and so our volume has dropped off dramatically unprecedented is a word that's used a little bit too much sometimes. it's absolutely the perfect word for what we're experiencing right now. we're down right now about 22% on our volumes and what we said on our call this morning is, that could be about 25% for the second quarter i think it's going to be broad and across the board there will be a few areas that might still be areas of strength, roadway construction is driving a fair amount of rock there might be a couple other pockets. grain, if china continues to be in the market. but broadly automotive has been hit with their shutdowns, our international intermodal inbound because of the retail impact, domestic intermodal is being impacted because of the broad economic impacts on domestic

manufacturing, so it's really a pretty broad impact. the way precision scheduled railroading is helping us is starting 18 months ago, we became much more efficient and much more agile at being able to take action quickly to adjust to the volume >> and certainly investors and wall street have responded to that as well i think part of the reason the shares are jumping as much as they are today when you use a word like unprecedented, given the fact that you do move so many different goods that affect so many different parts of the economy right now, it's pretty broad-based consensus among economists that we are in a recession of some kind from your vantage point what are those flows of goods telling you about what the economic downturn looks like and what specifically are you watching for in terms of recovery >> yeah. boy, that's the great unknown. so what's truly unprecedented

was the rapid pace of decline and the depth of decline you know how tightly connected we are to the overall economy, how our role in building america really has us touching virtually everi every aspect and to be down 22 to 25% that's that says what's going on in the economy. our concern is down how deep for how long we've made a lot of adjustments to our cost structure from frontline workers to adjust for the amount of work we're doing in the field to we've announced here for our managers, a required unpaid leave of absence one week a month for four months all the executives and our board are taking a 25% pay reduction that's all in an effort to try to match the current volume and now the question is how long is that going to last i, like you, have heard very, very intelligent economists, lots of experience, go anywhere

from good reason to believe there's a v, to good reason to believe there's a u, to good reason to believe there's a long and slow ramp, a hockey stick. ale not sure what to believe our job is to be prepared for whatever it is >> yeah. of course, the other big focus or story that's playing out right now is the collapse of the energy complex obviously you move a lot of product that's tied to things like fracking, via crude or sand or steel how is that affecting volumes? are you seeing any signs that we are seeing a slow down in terms of production or energy uage >> by all means we've seen the spreads compact and so we were helping move crude oil from canada to the gulf coast that's in the process of drying up because of the reduced activity in some of the permian basins and shale basins. we're seeing frack sand demand

dry up we're seeing demand for pipe and pipe projects that go directly into the oil country try up. it's having a pretty broad impact across the board. >> and lance -- >> lance, it's sara -- >> railroads like yours -- >> go ahead, sara. >> oh, i just wanted to follow up on the oil story, lance are you guys -- there's so much being discussed out there in terms of ways that oil could be stored right now is that an option for railcarsrs tank cars, to store oil? that seems to be the bottleneck and problem which led the prices to go below zero >> it's really not an option to store oil in tank cars on railroads. there are federal regulations that deal with the need to move that kind of product and not let it stand or sit in one particular area for too long it fights against current federal regulations. it's really not an option.

>> and financilly, lance, i just wanted to say thank you for joining us today exclusively shares of union pacific are up 6.8% the railroad is an essential business, so you continue to keep those trains moving and workers safe and we appreciate your time this morning. >> thank you i'm very proud of team union pacific for what we're doing during this crisis all right. morgan, thanks for bringing that to us. don't go anywhere. good morning welcome to "squawk alley." i'm carl quintanilla with morgan brennan and jon fortt coming to you live from various locations. you see equities are adding to wednesday's gains for the week, still at a stone's throw away from going positive. the dow would need about 400 more points to go positivefor the week and the s&p about 70 points or so the market action, though, as we say, extendings the gains from yesterday. joining us is legendaryinvesto

and capitalist alan, the co-founder of graycroft. great to have you back good morning. >> good morning. nice to see you or not see you >> yeah. it's good to see you we miss having you on set, obviously, as we do all of our ge guests we've seen creative ways for even endangered companies to raise some capital this week i just wonder, i mean as you look at opportunities across your desk what's interesting and how active have you been >> we continue to be active and i think the whole venture capital industry is. the most part, there are very well capitalized venture funds and they are open to buy and continue to meet on a zoom basis or other forms of communication and interesting phenomena is the fact that we're going to probably be investing in some new companies we won't have me