buying opportunity. >> be well everybody, have a good week. see you on the other side of that let's just touch on the market as we head out on this friday. been an interesting day and week we said the major averages on pace for the worst week in a month. we have the new hours looking ahead to next week enjoy the week kelly picks it up now. thank you, scott welcome, everybody on this friday, the selloff is continuing today with the dow down almost 100 points and stocks on the pace for the worst weekly decline in eight weeks now. why? increasing china tensions, weak economic data. take a look at oil rallying and nearing the $30 mark the june contract expires tuesday and expect a lot of volatility going into that on the economic front, retail sales plunged 16% in april, way worse than expected. industrial production down 11% there was a bright spot.

consumer sentiment picked up in early may, came in better than expected gives us maybe more insight of the what the psyche of the consumer is right now. let's get more on the markets with dom chu for that. >> let's put numbers to the themes in the open take a look at the dow, s&p and nasdaq generally a negative session today and hovering in the middle of the session at the highs the dow industrials up 27. at the lows down 271 on a percentage basis -- now take a look at the sectors because it is a mixed picture. materials, consumer staples and energy a mix of defensive and cyclical sectors leading the way higher you have financials, real estate and utilities and another mix lagging so far today as for some of the stocks on the move today, tacking about the themes you just mentioned. check out shares of qualcomm, renew renewed tensions with china.

could they be beneficiaries or hurt because of it also nordstrom, a worse print for retail sales on record so watch that mccormick, the spice maker how much people staying at home and cooking at home with the spices. >> what was your brand, favorite brand? >> my father-in-law loves pensey's spices and so we have the spice rack covered in those two brands. >> italian seasoning my new -- i never knew. >> i started an herb garden and will get tips from you after the show. >> if i can grow basil anyone can. thank you j. the dow and the s&p down about 3% this week and the nasdaq down about 2% for more i'm joined by jason trenner and bob michael.

it's great to have you both here jason, you're saying there's five things really to cause a selloff from here and certainly they grabbed my attention. run through them quickly. >> the most important one over time is simply time. and i think one of the things we have looked at when we talked to our clients is a difference obviously between the performance of the economy and the market and i understand people's hesitancy there and by the same token usually don't have bear markets in my opinion associated with a recession that last a month and that's what we saw from february into march so the most important one of the five would be time and then political wrangling, negative interest rates and things to look at in my opinion to set about a catalyst for a new

decline in the market. >> sure. we're sitting on the health front. political wrangling over stimulus you also say the return of corporate guidance could cause a selloff and negative interest rates and a democratic sweep come november. you don't have to get too political about it but why are you concerned about guidance and rates? >> as far as guidance right now, usually a little bit of art and science with the earnings numbers as a strategist and this is abstract or modern art. there's no idea. you have nothing to go on. i think in some ways people are giving companies as a result a benefit of the doubt and thinking the things are going to get better as the economy reopens which is quite -- it is almost inevitable, whether it is sustainable is another question. if companies start making longer term guidance that says, no, this is the real thing, going to take us sometime to get through

that could be a problem. negative rates in my opinion have been tried in europe and japan and largely been a disaster i think it's -- there are benefits to it but most of the benefits are greatly outweighed by the negative impact on the banking system which is really the oxygen upon which most economies breathe. i think that would be a bad idea i think the fed's done all that it can do and may do more in terms of expanding the balance sheet but negative interest rates in my opinion a bridge too far. >> bob, of all the questions i thought you were going to be reflecting is the bond market dead was not the main one. what made that kind of come up in conversation with clients and in terms of what you see happening in the market and what do we need to be concerned about? >> i think that a lot of clients are concerned that as the central banks are buying greater and greater parts of the bond markets it starts with

government bonds in the u.s. it's gone to agency mortgages, in europe corporates. it is now corporates in the u.s. there's a concern they're bringing yields down to an abnormally low level. i think what they're forgetting is we are going to see an extreme amount of issuance we are going do see trillions of dollars of government debt we have seen already this year a trillion dollars of corporate debt issued. there will be plenty for everyone to buy and you have to think of it as co-investing with the fed to help the recovery along. >> yeah. it is a point in terms of whether those purchases to kind of crowd out the private sector that the bears emphasized. stan drukenmiller is concerned of where this borrowing and buying is going and the people worried about rates being artificially low and trying to push them lower maybe putting

that aside, what's your point of view on how low rates can go does the fed need to go lower for large parts of the treasury borrowing to go negative people have issued debt at negative rates we have seen that already. >> well, i know last july when i said i expected the 10-year treasury to go to zero you thought i was crazy. let me tell you that when i heard jay powell talk about negative rates and he said, not for now, that for now even caused me to gasp. >> really? >> because once you fall into that negative hole nobody's been able to get out. no economy in europe and certainly not in japan so i hope they stay at zero. they need to create an affordable funding environment for all levels of government, for all businesses and for households to be able to finance themselves i think jay powell called it a

bridge for now and i think the fed has shown from 2015 to 2018 that they can normalize policy when the time is appropriate. >> bob you heard him say not now and also read that as many did as the door is open. for those that say you work at jpmorgan, explain why that's bad for the whole play and not just the big banks. >> well, it's bad for savers and so many savers in the economy that have money on deposit if you look at money market assets, they keep setting a record high every day. so if you take rates to negative, do you just cap people off at zero? if you take rates to zero you bring bond market yields down to zero and negative, as well you tend to penalize savers quite a bit and there's 10,000 retirees, new every day in the u.s., who need some form of

fixed income. >> yeah. >> positive fixed income. >> right, exactly. not negative fixed income. jason, the final word here to kind of bring it back to the stock market you guys have moved your investments kind of away from cyclicals to technology and communications and when i saw that i wonderred about if you're chasing the consensus sort to speak. >> well, there may be a sense in which we are doing that but i also think it has a to do with the length of time it will take for us to get back to the level of economic activity that really has a lot to do with the shape of the recovery. which is to say i think growth is impaired for a long period of time i think black swan doesn't necessarily the virus but the lockdown we have done a lot of damage to the economy that will take a long time to repair and i think in that environment people are going to pay up for growth stocks and i came into this year, i have say, very bullish on cyclicals and value oriented

stocks largely because i saw with the trade war dormant a stronger year for global growth and we'll never know what whether that would have been correct or not because of the virus and the lockdown but as it stands now i think, again, unfortunately, i think it takes some time to repair and as a result i want to be more in the growth orientation as it stands now. >> understood. great chat, guys thank you both appreciate it. we have some breaking news out of the oil patch and, remember, wti had been pretty -- rallying nicely and the rig counts out for the week. brian? >> i tell you when's not rallying and that's the drilling rigs they fell again. rigs according to baker hughes dropping another 34. we are at like 285 300 and change for total rigs with gas and offshore. i can't express to you the

significance of the repeat of the drop in drilling rigs. we were at 1,400 now we are at a couple hundred and because of this. look at this fracking operations in january, everything's humming. the economy's going great. 1,158 operations for new frack wells. it went up in february march, we start to fall. april dropped off. look at that, so far in may, kelly, we are at 92 down from 1,158. these are jobs, as well. i think that's key it goes to industrial production you're not drilling a well, you don't need it piped or the workers or the support crews i'm trying to find a lower number, rapidly going through the spreadsheets back years and right now i can't. this could be nearly a multi-decade low for the number of operational rigs. >> just so to be clear we had like 1,400 in 2010 and 92 last

month. any well in operation? that's a staggering decline. >> 92 is the number of frack operations, the number of different things, not just wells but companys that are drilling wells and the process. you can go back to 1,400 back in 2010 when oil coming off that peak and probably the problem. that's how we got to 13 million barrels a day. you wonder what's going on looking at the multi-month contracts, we are pretty much -- i'll get fancy for you i'm going to say something i thought i'd never say on tv. back ward ation. >> not that fancy. >> the ftc is not involved that's the opposite of contango. prices today in the future went lower than the current price that's really bad news if you paid a couple million dollars to store your oil offshore.

demand has been up people are driving up. production down 17 million barrels a day according to opec and why prices firmed up. >> no backwardation from brian sullivan. >> a quick thing i heard your comment with dom. best hot sauce in america, no affiliation to it, secret aardvark they're amazing. >> we'll collect the tips all show thank you very much. coming up, a quick break first talk about mastercard when we come back they say moving into the normalization use of credit card use is the time to buy the sector. plus 23 and me is working the find why some people are getting sicker than others coming to coronavirus. the ceo will join us much more coming up on "the chge."

hey! lily from at&t here. i'm back and while most stores are open, i'm working from home and here to help. here's a tip: get half-off the amazing iphone 11 on at&t, america's fastest network for iphones. second tip: you can put googly eyes on your stuff to keep yourself company. uh for example, that's heraldo. he's my best friend. oh, sorry nancy, i forgot you were there. get the amazing iphone 11 for half-off on at&t, america's fastest network for iphones.

across america, business owners are figuring things out. finding new ways to serve customers... connect employees... and work with partners. comcast business is right there with you. with a network that helps give you speed, reliability and security. and enough bandwidth to handle all your connected devices. voice solutions like remote call forwarding and readable voicemail. and safe, convenient installation. when every connection counts, you can count on us. get the connectivity your business needs. call today. comcast business.

welcome back credit card stocks staged a big rally this week when mastercad said it's seen a slight increase in credit card use even if the worst is behind us, what does the new normal look like i'm joined by lisa and chris. chris, optimism you see on shares of americanexpress, it is interesting that amx down 30% on

a 1-year basis but visa and mastercard is up 11% what is it to you act amex that seems to be hit by the drop in travel and corporate expenses that has you attracted here. >> yasuo you're right there's a hit to amex to a drop of 20%s of spending for them. what i think is an offset to that one or a diminishes the impact is the amount of revenue that american express generates from the transactional part of the card business, it's half of the revenue for the total company. they still make money on card fees and a bunch of other sources much more steady so there's a hit but relatively small and at this point we're guardedly optimistic of how credit quality for them. there's noise around the new

cecil accounting standard and i thinkfor the outyear forecast you can have some optimism that the credit quality issues stabilize and the provisioning to have will stabilize, too. >> bearish on mastercard, concerned of cross border activity they're losing. neutral on visa,. >> here's my question. so many people emphasize palpal winning in online commerce and my user experience is it uses have sunny a mastercard. so are they all just winning together now can you explain a little bit how this trade works >> yeah, sure, yeah, they are all winning together so you are right. the majority of transactions through paypal are funded by a card and so -- but paypal is making a spread on the transactions, as well as are the card networks and all benefit. the difference there is that paypal is all e-commerce which,

of course, is seeing an enormous secular uptick as a result of the pandemic with people all she sheltering in place. their numbers were the biggest surprise for example, they posted 43% growth in their checkout volumes in april that's more than double the rate in february. so you're starting to see this really sharp uptake in e-commerce volumes as people buy more things online. >> that's amazing. i can't stay logged in i try to use paypal and always get kicked out what about the levels of consumer spending? what is the new normal going to look like? we are starting to come back, starting the normalization process but where are we going >> yeah. i think the new normal is lower than where we were and some colleagues at piper sandler did some nice work with consumer surveys and showing consumers are cautious what they think about spending so i think you

will see some help in the quite from the stimulus checks but you have to ask what does the spending environment look like after the stimulus checks? when people are -- if unemployment is still elevated, people are going to be cautious on the spending and does weigh on overall spending activity on visa, mastercard and everyone else in the payment sector. >> aypal as well up 30% on the year and certainly hasn't suffered in the pandemic but how much do you think people are pricing in whether for them the traditional cards a v-shape recovery, a swoosh >> yeah. right now i'd say that the -- as much as it's clearly completely uncertain and no one knows but it's a swoosh style sort of slow, steady improvement we saw the mastercard new numbers yesterday for may and the u.s. numbers are at least

looking better u.s. is currently running down six year to year in the beginning of may to put a reference point on that, it was down almost 20 in april and if it gets to 0 that's about where we were in the financial crisis so if folks that are kind of trying to make sense of what to think of the numbers, what we aim for is like to get back to a flat year on year number comparable to '09, 2010 and what we have baked into our outlooks for visa, mastercard, pay it pan what we hope for and that's negative six number already in may was a positive surprise yesterday. >> but still to hear that zero is only getting us back to '08, '09. really interesting thank you both appreciate it. >> thank you. coming up, maybe it's in the genes. 23 and me is recruiting more patients to expand the dna study

to see why some are at greater risk of covid-19 and others. washington wants socially distant airlines could the airlines survive under the new rules? you can watch or listen to us live on the cnbc app "the exchange" is back ia uplen wasting time. that's why td ameritrade designed a first-of-its-kind, personalized education center. their award-winning content is tailored to fit your investing goals and interests. and it learns with you, so as you become smarter, so do its recommendations. so it's like my streaming service. well except now, you're binge learning. for a limited time, get up to $800 when you open and fund an account. call 866-300-9417 or visit tdameritrade.com/learn. ♪

welcome back now to the very latest in the coronavirus pandemic, over to sue herera for that. sue? >> thank you very much, kelly. good afternoon, everyone as some parts of new york opens today governor cuomo is extending restrictions for the rest of the state until may 28th and 4 states coordinating efforts to let people back on the beach. >> the agreement is new york, new jersey, connecticut, delaware we'll be opening beaches for the memorial day week. states will have different specific rules about what happens on that beach.

it will be plus or minus but basically in the same ballpark. the navy hospital ship "u.s.n.s. mercy" left los angeles today. some staff will remain the ship was sent to los angeles in late march to help treat non-coronavirus patients although only ended up treating 7 7 patients back to you. >> all right thank you very much. still so much we don't know about covid-19 including the role of gentlemetics. we have meg for more on that and a special guest. >> there are some things we do know about the risk of severe disease with covid-19. of course, it increases with age and with underlying conditions but there are also instances where it seems to strike people who are seemingly very healthy and young. for example, nbc contributor dr. joseph fair that tweeted that photo this week of his recovery

of covid-19 and in a story he's a seemingly healthy 42-year-old running 5 to 10 miles a day and still there he is in recovery at the hospital so a llt of groups are looking into what might be driving that, why some people are asymptomatic and others are hit so hard 23 and me started a study and now have enrolled more than 500,000 people, 7,000 of whom have had covid-19 and this week they extended that study to try to focus on people who have been hospitalized with covid-19 and they're giving away 10,000 free test kits, the genetic test kits, to try to enroll those folks so joining us now is the ceo anne wojcicki. great to see you, thank you for being with us. you started the test a month ago. when do you expect to get results? >> yeah. we started it april 6 and we

offered it to 23 and me customers to say have you -- if you've been exposed or want to take the survey to take the 23 and me covid survey, almost 8,000 people said that they have had covid-19 and because we were rushing to see can we make a discovery, we decided a couple days ago that we wanted do give out 10,000 kits to anyone who said that they've been hospitalized with covid-19 and we're really looking to see are theregenetics about susceptibility, why some people are getting it and severity and can we find something and can we find something quickly >> and in your announcement about the study, you mentioned that previous studies have shown there's some interplay of genetics in terms of susceptibility for other

infectious diseases. tell us about what the precedent is for seeing the genetics role in these things and whether we have seen studies showing influence of genetics on the severity of infectious disease. >> yeah. we actually -- there's a couple that are good examples noravirus is hearing about that sometimes, cruise ship virus, the 20% of the population resist thatn't to that. hiv is another one where there's a well-known mutation of ccr-5 and people with that mutation are resistant to hiv so we published a paper. we started doing research on infectious diseases and published a paper a couple of years ago looking at the customers and a number of diseases like measles and gives us optimism of a good chance of finding something that, you know, will show why some people have a more severe case and why

some people are more susceptible to others. >> you also noted in the post of expanding the folks in the hospital that it is a sensitive situation. many people are still recovering r. you partnering with academic medical centers, hospitals how will you find the folks and get the kits to them >> a lot of what we're hoping because you're right a lot of people are going to be in the hospital so we're hoping that family members will be able to, you know, take advantage of this and then find when people are out of the hospital that then they'll be able to help them enroll we are absolutely interested in partnering with hospitals and academic centers, pretty much anyone to help find the answers here i feel like this is really in some ways like this is something that's pulled together the entire scientific community and there's a lot of collaboration happening right now and we want to just do whatever we can to

help a couple academic groups reached out to us. you know, some of the cities with real hot spots, for instance, new york there's a number of sequencing programs underway. we are committed to publishing the data and collaborating with a group out there to pull data together to see can we find something. >> and you clearly have a lot of participants already, 500,000 people have opted in but we have been hearing over the past few quarters from companies of illumina that direct to consumer genetics has been on the downturn, fewer people are getting the kitts is that something that you have observed what are the most recent trends on how interested people are in this >> a couple interesting things have happened. there's absolutely a slowing of the market compared to 2018. '17 and '18 you have an

explosion and people have interested in the gentlemen nettics and i think you had a number of different factors playing in last year where people want to understand privacy and just understand how their information is being used and we have always been very transparent with our cust mores and always been a big priority to make sure people know exactly what they're getting and that they have this opportunity to opt in to research or opt in to dna relatives. so what we have seen since covid-19 is that there is an initial hit to sales but it's really come back and i think that comes from the fact that people realize we're likely to be home for a while. the medical system has changed you're not running into the doctor's office for you teroutie and understand to understand how to take care of yourself at home and what we do is give people information about risks. so what is it that's in your dna

that you're potentially at higher risk for, type 2 diabetes, and now is there an opportunity for you to change your behavior? and actually change and prevent a disease. i think you see a lot of people these days interested, more interested than they were in the past, in preventing a disease because they want to really stay out of the hospital for good reason. >> all right yeah medicine sure is changing with this anne, thank you so much for being with us today. we're eager to hear about the study results. kelly, back to you. >> thank you coming up, 16 office towers with 10 million square feet, a sampling of the real estate of rudin management we'll speawik th bill rudin right after this ambulance blan take allegra-d... a non-drowsy antihistamine plus a powerful decongestant.

so you can always say "yes" to putting your true colors on display. say "yes" to allegra-d. find a stock basedtech. on your interests to putting your true colors on display. or what's trending. get real-time insights in your customized view of the market. it's smarter trading technology for smarter trading decisions. fidelity. ♪ ♪ ♪

. welcome back to "the exchange." a quick check on the markets we're way off the lows and the dow down 270 down 38. the nasdaq is positive by 11 this is against the backdrop of a rough week here's the sectors leading the way. utility just -- real estate just can't catch a break these days and it is 10 million square feet, 18 luxury apartment buildings and 16 office towers, some of the property my next guest manages in new york. as they open, how will commercial buildings make the tenants feel safe? for more on the path forward for real estate i'm joined by ceo of

rudin management, bill rudin >> hi, kelly thank you for having me on. >> must be a very anxious teem for you. >> it's been -- yes. it's been very interesting but it's just -- you know, you mentioned the state, new york state starting to reopen the governor is slowly opening the door he's done an amazing job in communicatinger a communicating and making sure we get through this very difficult time and we have been working on all levels of government trying to be as helpful as we can to make sure when new york city opens the cust mores and the tenants are safe and they feel comfortable coming back to the work environment. >> we'll talk about the technology in particular that you and others are using but i want to talk big picture for a moment nielsen said and this is in "the new york times" the other day even after coronavirus their 3,000 workers in the city can

work from home most of the week and manhattan faces a reckoning if working from home is the norm even yesterday the ceo of scott's miracle gro said he used to commute every day i won't do that anymore. what if they don't need as much commercial space as they used to >> first of all, you had the just guest on before about research and science and i think there's been reports about vaccines coming on the market sooner rather than later which is very helpful sign, therapies. it is people working from home has adapted very quickly but i think new york city has always come back from these type of situations in the early '90s we had 30 million feet of vacant feet in lower manhattan. after 9/11, nobody was going to come back into an office building even, you know, everybody wa going to work below the 15th

floor. after sandy. so the obituary of new york is written many times but we're confident with proper protocols, you know, great leadership from the mayor and the governor and the social, you know, human interaction that is always been part of the strength of new york city will come back. it's going to take a little time after all the other situations but it will come back and there will be other companies that will step into the void as some companies continue to work from home we have got incredible research hospitals. we have scientists we got medical institutions. they will grow other companies will step in and use technology to be creative and the companies of the future that we hope will fill in our spaces. >> yeah. so let's talk, speaking of

technology, several things you guys are doing to get through the next up to 24 months, you have a tech start-up subsidiary. you check temperatures, expand it to health and wellness. you have an app to provides situational awareness to tenants to see how crowded spaces like the lobby and other rooms are. waiting leans for the elevators. remind me of the sims city game i played as a kid. >> my son who's 35 years old, he grew up on sims city, also i'll hire you as the sales person because you pitched it perfectly. we started this prescriptive data a few years ago to make the building environmentally friendly, operationally function it gives realtime da to the building operations team and so trying to create this app and give our tenants realtime data

is a continuum of this technology so we've been working on this for a while. we understand how many people are in the building, what the co2 levels are, water e sumpgs, electrical consumption it is the building operating system of the future and we have been licensing this to other building owners. >> sure. >> and corporations literally all over the country. >> could be a new business model. i find it on some level creepy but understand that people want -- as long as it's anonmized i guess that it's useful information real quickly before you go, danny meyer is talking about not reopening the restaurants because the level of demand is simply not coming back in the foreseeable future does something leek that send more of a chill down your spine that these are the big players to step up right now >> well, look. danny is a great friend.

actually we're having him operate our food service in our new building in brooklyn at dock 72 but i think it's really, you know, it's been a lot of discussion about state and city funding and i think the house today hopefully or monday will pass their covid fourth stimulus bill with billions of dollars. not just for new york. new york state 8% of the gdp new york city is 5%. so we need not just us but every city across the country needs that stimulus dollars to get funding back into the city we have taken tremendous hits on city revenues, transfer tax, income tax we need that revenue to get back in there and support our basic functions and i think, you know, restaurants, you know, a local restaurant that my wife and i go to, i spoke to the owner and he

said -- i said how will you adapt to the 30% he said a seating at 5:00, 6:00, 7:00 and 8:00. so we have to adapt and make changes and hopefully we'll transition through, get to the point where the vaccines and therapies are out there and city will be back better and stronger my dad always said never bet against new york city. so we're continuing that. >> that's for sure no i know what what you're saying thank you for joining today and good luck with it. >> thanks, kelly. got some 13f headlines from tiger global dom chu has those for us. >> the notable tech oriented hedge fund founded by chase coleman, interesting highlights include a new stake in online exercise and streaming equipment maker peloton. a new stake there. also a decrease in their stake in uber by just around 54%

so possibly coronavirus related plays there. also a large increase in shares of salesforce on the cloud side of things and a total sellout of slack. a massive increase in shares of workday and datadog so again on that software cloud play type situation, as well also checking out what's happening with other parts of the market and digging through these and big deals and remember, kelly, these are as of the end of march so there's a big data lag on the numbers. back over to you. >> thank you the chip stocks are hit as u.s. tensions with china flare in thyme with the administration blocking shipments of semiconductors to huawei the latest is next here on "the exchange." roblem. (clog dancing)

at least geico makes it easy to bundle our renters and car insurance. yeah, helping us save us even more... for bundling made easy, go to geico.com ever something's gone mogotten into the office.m, i hear you. feels like there's no barriers between departments now. do you think everyone appreciates it? i do. huh... forgot my glasses. serivcenow. the smarter way to workflow. and its mission is to give you truly transformative sleep. so, no more tossing and turning... or trouble falling asleep.

because only tempur-pedic uses proprietary tempur® material... that continuously adapts and responds to your body, to relieve pressure... so you get deep, uninterrupted sleep. all night. every night. the tempur-pedic summer of sleep starts now, with all tempur-pedic mattresses on sale, and savings up to $500 on adjustable sets. welcome back

take a look at the semiconductors today the etf tracking them down about 3% right now the white house is looking to cut huawei off from its u.s. chipmakers the u.s. also now bracing for retaliation of china by activating the unreliable entity list coming as taiwan semiconductor, an apple supplier, announced plans to build a plant here in the u.s. let's talk about it and the impact on the industry with jon fortt. a lot to unpack here and one thing, the impression i came away with in reading this is while i understand the imperative to get some of the semiconductor supply chain into the u.s., sounds like the u.s. companies feel like it's a disadvantage competitively. >> where should we start the headlines at odds with one another because a fab, a chip manufacturing plant, is unique in that it costs billions and

billions of dollars to make and takes years to make one and pretty much as soon as you build it it's almost obsolete. they're building one in arizona on a process and by the time it's built around 2024 they estimate that they'll probably be close to moving to even more advanced processes so building something like this you really want stability, regular will tori stability, you want a tax runway to see and understand and want to be able to export the product in there anywhere in the world because assembly could happen anywhere. you don't know who the customer will be in four years. the regulatory things that the u.s. is talking about with huawei right now, which is the biggest customer in one of the fastest growing economies on the planet, that works against the certain the i that they want. >> let me ask it from this point

of view. what does it mean for intel? intel said they were working on a plant here in the u.s., maybe to supply the pentagon i see the big picture and move more supply chain into the u.s. and put maybe less of the reliance on china in particular but what's it all mean for intel? >> intel has already by my count 12 in the country and 4 in arizona and i think the question is more will the incentive picture change for intel to expand what it has already or build new in the u.s.? and i think part of that is the regulatory picture, who gets exceptions from some of the regulations that are coming out? what kind of certainty can the government provide to individual companies even if they're trying to provide some barriers or negotiating room with china? >> right no it is tricky a lot of big picture stuff here and the stock's reacting

concerned about it thank you. meanwhile, nearly a third of u.s. colleges and universities are considering keeping most of the classes online this fall those are the latest figures that has lots of students and families rethinking things some are going to court. scott cohn is live with more. >> we are at san jose state university this is one of the 23 cal state campus that is announced that they will stay basically virtual for the fall but no break in the tuition and the university is even refusing to refund some fees for things like the student center and health care that is infuriating to some students like sonoma state biology major mckayla miller says she is out about $1,000. >> it is not fair for them to treat us like this we signed a contract that said we would pay if they would

provide us with certain services and they're not holding up their end. >> reporter: so miller is joined a proposed class action suit the university says it is still providing services but some remotely and will defend the case vigorously. similar story in the university of florida where anthony rojas is a grad student. >> the idea behind it is if you're going the charge someone for a physical service, you no longer can provide it, we believe students should get a refund >> reporter: the university president said that's not the point. >> many of them didn't have the full access to those student services but what we did was commit to the students that they would provide for them a rich experience with additional expenses that we took on through the online experience. >> reporter: there's also a separate group of lawsuits that

is actually asking universities to give back some of the tuition to make up for the switch to online learning but some legal experts say those may be tougher to prove kelly. >> scott, i'm surprised that so many are still trying to have virtual classes. a lot of students, from what i hear will defer or go to some place that is open >> reporter: that's right. there is a lot of interest in this whole idea of a gap year. there's a group called the gap year association they say their web traffic has quadrupled 40,000 or so students took a gp year it could be hundreds of thousands. that increases the financial uncertainty for all of these colleges >> thanks very much. congress wants to do away with the middle seat but setting up truly social distant

airplanes could be devastating tom love is back we'll have his outlook for restaurants as spots in texas for have been open in texas for two weeks with surprising results. don't miss it. we live in uncertain times. however, there is one thing you can be certain of. the men and women of the united states postal service. we're here to deliver cards and packages from loved ones and also deliver the peace of mind of knowing that essentials like prescriptions are on their way. every day, all across america, we deliver for you. and we always will.

welcome back the pain keeps coming from the airline stock. united and delta are down double digits again and american and southwest are close behind this is on top of huge losses for the year to now there's a fight over whether or not they can mandate airlines to operate at 60% capacity that would push the airlines to keep the middle seat open. something customers and congress

want but is it feasible. you're a very busy man you know this through and through. what do you think? can they be mandated to cut back and why wouldn't they have to if that simply what the flyers want >> yeah, you're right. never imagined that airlines would stop flying and there could be so much to talk about the issue here is that one of the strongest relationships in all of airline economic s the relationship between how many seats you pack on the plane and the unit cost. the kocost of carrying each sea each mile. if you're going to force them to reduce capacity.

it becomes value judgment. you know, we can't have people six feet apart is 18 inches better than nothing at all i don't know i probably would rather have probably would rather have 100 people instead of 150. am i willing to pay as much more as it would cost to do that. different people will have different answer >> it means the people at the bottom of the income chain will drop out it's making flying more expensive and making it more of a luxury product again i guess i go back to whether or not it's mandated, is the idea that we have to protect flyers from themselves that people would pack on the planes if congress doesn't mandate this? >> that's partially the idea, kelly. people will continue to fly. more people and as that happens, will we be back to the levels we were last year let me show you a typical 737. last year 84.4% of the seats on a typical 737 were filled.

you had a smattering of empty seats on most flights. this is what representative who runs the transportation committee is proposing he says do not book the middle row. they should limit capacity to 67% of the seats being filled. by the way, that means you get about 18 inches of elbow room with the person next to you. that's not socially distant. there's a few people that are saying, it should be true social distancing on a plane. let me give you some perspective on what that would mean. on a typical 737 you might get 20 passengers in economy and four in business class that's an unsustainable business model. would never fly in the industry. airlines would say we'll go bank rupts before we do that. it's not that they don't care about the safety of passengers but this is an industry built on the idea you put as many people on plane as possible you need that volume in order to turn a profit.

>> if you can really only fit 20 people on plane and all using recycled air any way, the very act of getting on a plane is a pretty risky one it seems the message is either people want to take that risk, but should be discouraged from doing so i'm just trying to understand kind of -- it seems to all be coming down to the airlines. there's a lot of different things going on here >> yeah, airlines, airplanes and airports are not designed for social distancing. with the lack of national guidance on a lot of things but this, it's up to the airlines. we have seen them struggle with implementing mandatory masks and temperature chex and all of them come to different con clugs. as phil said, that math would take us way back in time flying would be a privilege and i think we are at a point here at some point here people would

stay home, unfortunarntortunate country opens up whether it would be safe for them to be on an airplane at any price. if you can't answer that question you're trading that for the certainty of higher fares for every one else >> i wonder if this is all just an exercise in making ourselves feel like we're doing something that is neither true social distancing nor barring airlines from flying? >> i think you're right. these airlines need to put as many people on a the planes as possible if you force them to keep the middle seat open, can they do it yes. will they raise fares? you bet they will. then you'll have people complaining the air fares have gone up. they are up 30% or 45% compared to last year why are they doing this? it's simple. these airlines paid to transport you and i from point a to point bark b. there's a cost involved.

hopefully they turn profit >> it's going to be wild to see what happens here. i feel bad for everybody involved everybody. seth and phil, thanks. we'll see where it goes here whether congress does mandate something or not that does it for the exchange. time for power lunch we'll see you in just a moment welcome. welcome to power lunch welcome back to the kitchen for a friday our breaking news coverage of the coronavirus and the markets continues right now on "power lunch. stocks are making a midday comeback now with a second day in a row the dow bouncing off lows, coming back approaching the positive mark there. it fell 270 points as tensions rose this morning earlier with china. we'll talk about that in just a moment more disappointing economic data coming out earlier today retail sales really slamming the