hong kong. taking usa one step closer to ending its special relationship with the territory we'll take you there live. president trump preparing an executive order on social media companies after twitter fact checked two of his tweets. we'll bring you andrew's meeting straight ahead plus futures on the rise after a two-day gain over 1,000 points thursday, may 28, 2020 "squawk box" begins right now. good morning, everybody. welcome to "squawk box" on cnbc. i'm becky quick along with joe kernen and andrew ross sorkin. we are looking at green arrows again. joe mentioned over the last two

days, we've seen the dow up over 1,000 points a gain of 553 yesterday and 529 points on tuesday. looking this morning at the dow futures indicated up another 105 points we are back above 25,000 for the first time since march when watching the dow s&p is up just under a point the nasdaq down around 54 points both of those indexed were hire yesterday as well. the 10-year looks like it has been yielding around where we've been around 0.677% we will continue to watch this this morning we have a lot of big guests coming up. now to the moment we've all been waiting for. joe and andrew, i'll send it over to you. >> what moment would that be we'll be in a two-shot >> we are good we spoke yesterday we are good.

you didn't have much time. >> we made the news. >> a few comments. people seem to have differing opinions he wasn't able to talk much. we were moving on. he had zuckerberg. we don't have time to dwell. we've been together 10 years longer than many marriages we have our moments but we will disagree but not be disagreeable, we think that's one way to look at it or maybe the debate of the entire country finds itself in right now. >> here here 100% we are having the conversation happening at everybody's dinner table. it is a family, i'm grateful for

it i want to say this to you, joseph you have one of the quickest minds in the world i learn the hell out of it i'm grateful for you >> it can be used for good or evil as we know we'll move on and do our best. is the world stress where we all have anxiety and concerns. it is just that in my long life, i have never seen anything like this we are dealing with the squawk family with the same thing, i think. >> good. i'm glad you guys made up. it is like thanksgiving dinner but no food or alcohol let's get to the news of the morning. >> usually, you are there. yesterday, you were like i'm out of here. i don't know these guys.

>> i'm glad everybody is feeling better today the world is a busy place. there is tension everywhere. china's parliament has approved the security bill paving the way to be finalized and implemented. going now to emily in hong kong. we kind of knew this was coming but seeing it happen so rapidly may have caught some people off guard. >> that's right. it was a rubber stamp. we saw china's parliament overwhelmingly approving the law. voting 2,878 in favor with one option and six an tensions tackingle sub session, terrorism and interference they meet every two months so new developments will only be

known in june or august. the government will fully operate per the legislation. in support of the outcome and calling to support the law the decision comes hours after the secretary of state mike pompeo saying they are no longelonger autonomous from china. >> joining us to talk about the impact on the markets. i have to remember, no k i go back and forth. chief investment officer you are surprised. we are all surprised, are we not that we are at these levels. i don't understand it it could

be different with interest rates too high this might be more like a natural disaster the market is saying something i'm not sure what the levels we forecast would be at the end of the year or even six months after it focused on the news and the moderate territory we are seeing we feel like the market has pulled forward with the news do we expect these levels? certainly not at the end of may. we did expect the market would be led by s&p 500, large cap

market and the bonds where the fed was going. that has been the leaders of the market we've been leaning into those areas. we can't say we've been expecting this sort of recovery in this time frame our challenge is where do we go from here between now and this time next. >> you go back to anyone trying to analyze how this crazy stock market equities work all based on human nature when it comes down to it. do you believe the market discounts into the future. it was like nine months into the future if that is true, can you see why it is so confounding forecasts of the future are hard one month is impossible.

two months how could we have any idea are we confident the market will be predicting something it knows nothing about these problems and all the things that could happen it doesn't know. >> it doesn't know we do believe and i would agree with you that the market is forecasting a moderate rebound not a reshape because you'd see the cyclical rebounding. we are not seeing that we are seeing a recovery with more offensive stocks in the next week or two the market does appear to be looking to second wave risks politically in china and elsewhere.

forecasting that those events won't happen or won't be a meaningful negative if we get second wave reinfections that we won't go into the total lockdown using moderate approaches to address those situations to allow recovery at a moderate rate and get breakthroughs on the they are pper pew ticks or e side >> we've alluded to this in a lot of discussions are we stuck with a multiple just out of sight? if the market stays where it is or continues to go up, we'll be at 25, 20. i don't know where because earnings will be down 30%, 40% 50% in a lot of companies.

will we have to get used to looking at these valuations saying they are insane 20 to 25% earnings >> as long as the rate sticks around 70 basis points, it is reasonable you should price it in higher on the s&p it is not going to be 15 times the long-term average. does that mean we'll be comfortable with the 19 or the 22 the impact of the stimulus, the path of recovery and the reopening. we with expect it would trade at higher multiples it took them seven years to move off last time around and would take a long time this time which means you should price in to a

higher valuation >> thank you for sharing your in sight and coming on. i'll toss it over to andrew now. >> thank you >> i was saying, andrew. social media isn't the universe weird trump is talking about, i want to close down parts of twitter half and leave the other half open >> i know exactly what half you are talking about. the other half yes. >> what a great interview to have after all we've been through. >> thank you for teeing this up.

facebook ceo mark zuckerberg taking about great stuff with twitter and trump and everything else we started by talking about so many people on the move from working from the office to home to the project he's been working on during quarantine stay tuned we'll be discussing all of it with a live interview later with the bank ceo on the health of the bank and economy and so much more when squawk returns after this

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welcome back this morning, facebook leaning in aggressively to a remote work force predicting in the next 5 to 10 years, half of the company's nearly 50,000 employees will work remotely i started out asking how he envisions the workforce of the future and how he's thinking about physical proximity to power. the old idea of face time. >> the big idea is access to large pools of talent who don't live around the big cities and aren't willing to move there there are a lot of people in

u.s., canada and around the world who think we and other companies will be able to access we see on the retention side, one of the top reasons people leave a company is that they want to move to a place to people with their family maybe, and we don't have an office there. it is one of the ways to recruit new people because they are already ramped up on our culture. we think this will spread economic activity across the country. economic activities are already available in these cities which means people will need to choose between the lifestyle they want. it means they'll move to a city and leave that for good opportunities. i think something like remote work would help on that. there is environmental prospect.

people will spend less time commuting and more time porting in so people feel connected and present no matter where they are. whether that's the main feed products or things like video chat or enterprise with hardware and portal that really help you feel present i feel like moving in a more remote direction will help add advance some of that future technology as well. >> do you imagine senior people in those roles being remote? >> yes we'll get there. one of the big things we decided

in rolling this out in a measurered way we've experienced if you are a new graduate out of college or haven't had a lot of experience working at a company, it is more important you work at an office to get the training to get ramped up on how a company works, working with co-workers before putting you in an environment where you are working on your own, more remotely more things like that. the senior folks and the demand where most senior people will shift to work remotely more of the time in these senior roles, they are unique i couldn't choose to work from home all of the time even if i wanted i have to go meet with

government and folks i would anticipate spending more of my time remotely than i did before but it is not feesable for someone like me to work remotely all the time >> one of the big questions is company culture. how do you keep that when companies are suppose to follow the lead of the chief. i asked mark how he thinks about that >> one of the big challenges we'll have to work through is that is the feeling of building social bonds and call dur and creativity together. people are going to feel like they have the same opportunities to do their best work remotely in addition to being in the office and that it will not disadvantage their career opportunities. those are things we'll have to be very intentional about how we engineer these processes and

make sure ambitious people who care about their career know it is a good decision to work remotely and get good stuff done there are a lot of open questions this is why we are taking the approach over the coming years starting with people who are experienced or high-performing at the company to set the tone that good, key leaders that folks a lot of people want to be like are moving to be remote. that will set the tone and we'll figure out how to open this up to more people >> we talked about all sorts of other issues like big tech and regulation i asked mark to share with us -- i said what is the coolest non-facebook app tell me about a competitor you've been using during this

quarantine world he had a fun one for us. >> i've spent a lot more time playing with games and virtual reality with friends during this period i've always been a fan of virtual reality and why we started or bought occulus and we've been building that during this period where i can't be with friends. having the ability to build something in this space together i started playing this game "echo arena. it is a combination of frisbee in 3-dimensions. i don't know if you remember the game, the enders game. i get teams of my friends and family together and we are playing in vr. it is incredibly fun i think it will be a glimpse of

the future more people will enjoy. we'll show you a lot more of that interview and the fire works of it that relates to this news president trump planning to sign an executive order on social media companies. no word on what is in that order off two of president trump's tweets were tagged prompting readers to fact check the post shares of twitter and facebook are down marginally. we'll show what you facebook ceo mark zuckerberg said about the fact checking and what facebook plans to do or not do about it that comes in the 7:00 a.m. hour >> i love how thoughtful he's being about the idea of working from home and addressing the long-term problems with that the idea that even ambitious

people, senior people will be able to work from home and it will not hurt their career path and putting those people first is super important working from home has always been given a little bit of a stigma you can do that but it won't cost you you won't be able to move as quickly as you might have done otherwise. it is thoughtful how they are going about this and not just doing it willy-nilly >> it is fascinating to watch. he is the largest company really in the world doing this at scale. they are trying to hire some 10,000 engineers this year so to find them around the country will be interesting. the economics of all of that even though people will be working from home, i imagine he'll be building almost minioffices in places where people can gather. it will be interesting all of this has been expire

ammed by our own work-from-home experiment >> right the other thing is enders game it never occurred to me. he is ender. he is the guy that manages to win the entire world of aliens coming after him he really is >> i'm still thinking about that game before you said that i real liam. a frisbee in a weightless world. >> remember in enders -- they were going around. >> if you missed it. you'd never get it back. remember the guy on 2001, he's still going like that in 2001 away from the ship he's still going like that if you miss, you need a new frisbee. >> in enders game, they did it in a dome so it would bounce

back >> all thief us need to get occulus and play it together >> i got to get with it. >> a few donkey kong. that's old >> brick breaker >> andrew, great stuff looking forward to seeing more of that coming up on the show. also coming up, remember the images of the lake parties new data that tracked those partiers that traveled from those parties, to businesses and back overwhelm all over the place. that's coming up next. let's take a look at some of the images from the pandemic impact across america. when the world gets complicated,

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right now, it is time for the executive edge and a closer look at the scenes of crowds beaches and boardwalks you probably saw the video from lake of the ozarks we have new data visualization the small tech company that got attention when they used cell phone video to show the spread of spring breakers in the early days of coronavirus. now that company is using the same anonymous spread from gathering in missouri. you can see the spread out to gas stations

putting out information on people from a packed boardwalk in maryland. it is amazing how they can entirely watch where people go over spring break, it was really populating the country where people went back all over the place. it is just one way to track where people go from there you saw the spread where they left the board walk and where they went back in maryland taking a quick break and talking about two new studies that found high level of covid cases with no displayed symptoms and later, brian moynihan will join us from bank of america a look at yesterday's s&p 500 winners and losers these days, it's anything but business as usual.

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good morning welcome back to "squawk box. this is cnbc the dow has picked up. now indicated up 136 points after gaining more than 1,000 points you are watching a little melt up with the dow watching more than 25,000 for the first time

since march. >> a troubling new study finding more than 80% of passengers and crew infected with the coronavirus on a cruise ship did not show any symptoms. observations of a 21-day cruise to the antarctic after the first fever, they started confining passengers and requiring face masks over 178 exhibited no symptoms a study from wuhan china finding that 42 percent of cases in a test groom were a symptom magnetic joining us now dr. scott

gottlieb great to see you you heard before the break, becky showed us what the spread of people, the physical spread looks like how concerned should or should we not be? >> we should be concerned if people are becoming complacent i think the big risk is where people are in doors close to people for a longer time look at las vegas. where you have people gathering together as far as the spread, we've been working on the assumption that 20 to 40% of the cases are in fact asymptomatic. the sums of 20 to 40% which is higher than other symptoms with flu, about 16 to 20% had

cases of flu are asymptomatic. that's lower than 40% we suspect coronavirus might be the other piece of the information is that people who are asymptomatic or mildly symptomatic are just as transmittable. >> i've been hearing from a number of real estate owners who are concerned about whether they need to retrofit their air-conditioning and heating systems. a lot of these lead designated buildings have put the heat and the air-conditioning on the floor with the idea that it rises up heat rises to make it more efficient. that will make the whole situation worse when people go

back to the office in meaningful ways >> i don't know about the flow of the air whether the heat of the air is coming above or below in terms of viral spread a lot of people are putting in hepa felte hepa filters and putting in uv lighting that is important when you have a confined space you need to clean the air not just for coronavirus people will look differently about respiratory pathogens going forward. this might be sort of a second flu, if you will if we have two flu seasons, that's not sustainable we have to figure out how to sustain morbidity. we are oddly complacent about the flu.

>> what you were saying about confined spaces with poor air flow and maybe recirculated air made me think of airlines. we had mic on the other day who said he would be perfectly comfortable riding in the middle seat of an airline would you be comfortable i think a lot about airplane air which grossed me out before this what do you think? >> i'm not perfectly comfortable riding in middle seat of airplanes at normal times. there are ways to take care of yourself there are risks along the entire journey. the car ride to the airport, activities in the airport. there are things you can do if you have to travel to reduce your risk. the airplane is only one piece of that risk if you are protecting yourself on the plane wearing masks, other people are

wearing masks. the flight attendant are trained in proper ways not passing things from passenger to passenger. it is not risk free. some people have to fly. >> i what nt to talk about the next two week time line. what is the day, if you look at a time line, when we can breath a sigh of relief is there a date on the calendar you are focused on >> i think we are getting more comfortable now looking at data. we have seen upticks of the cases. looking to june seeing the slow burn where it continues to decrease that could be an indication where we have a relatively quieter summer and get through this we have a lot of infection around cases haven't bumped up.

they've come down. we'll have this slow burn through the summer and only sets up up for the fall we are only diagnosing one in 10 cases. we are turning over 200,000. that's a lot across the country. your risk isn't not necessarily high depending on where you are. it still leads of infection heading into the fall. we' we have not been able to extinguish this. >> we have talked more about testing. are more people getting testing. in some places, there are less tests. we've talked about tracing and how important that is. we used to talk about by the minute probably three or four weeks

ago. >> we are not doing a good job yet putting in place for asymptomatic or mildly symptomatic testing. i know many if you have a fever, they are turning you away to a testing site we have to encourage asymptomatic or mildly symptomatic screening. as far as the case intervention, we have a patch work response. some states are doing well i'm familiar with maryland, massachusetts, connecticut i know what they are doing california as well my friend bob out there. some states aren't that's going to be a problem in the fall if we have this patch work approach and don't have a system of casework and testing heading into the fall. >> dr. scott gottlieb, always a pleasure to seeing you we look forward to seeing you

again soon joe, over to you coming up, take a look at shares of the gap. up 10.62 check this out diners in france may soon see these plastic sheets to protect customers so they can sit closely together in restaurants so they are not half empty and would keep restaurants profitable i can't get used to that lee "scent to the cone of sincinget smart. doesn't come down like that. we'll be right back. (vo) our communities need help like never before

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welcome back u.s. equity futures adding more. the nasdaq is lower this morning. we'll see what finally happens with the social media things more from zuckerberg coming up amazon plans to keep the 175,000 jobs it added. going to give 125,000 the option to stay on full time the decision is expectations in growth in online commerce will continue some of the vehicles on the road it's like one out of every three vehicles is an amazon vehicle. these guys because they are moving fast, they park anywhere. they park on the other side of the street facing me they've got some nice equipment too.

they drive mercedes vans it is kind of interesting watching amazon take over the world. it is weird to watch it reminds me of the movie "robo cop. there is one company left. >> the same thing in "wall-e." >> don't remind me of "wall-e" all those saedentary people. it was said, the average person is up five >> gained five pounds. >> i've always been above average at things. i excel at so many things. >> you are an overachiever when we come back, the future of schooling. some colleges announcing their plans and how classrooms might

look different we'll talk to the president of university of miami and his plans for the fall that's next. >> announcer: don't forget to subscribe to our podcast you'll get interviews, behind the scenes content subscribe today.

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welcome back, everybody. colleges across the country are facing the ultimate decision, whether or not to reopen for on campus classes in the fall the university of miami is one of the schools that has announced it will be open next year but that things will look differently. joining us right now is dr. julio frank. he is the president of the university of miami and, doctor, thanks for being with us this morning. i've been trying to get my head around this question of how universities can do it because i know that you have said safety is your utmost concern you want to make sure everybody is social distancing but i just don't understand how entirely that works at a university when you think of people teaming up in dorms, when you think about the dining halls, when you think about classrooms what kind of plans have you put in place how is this going to work?

>> we've been working around the clock to redesign the entire experience our plan has four pillars. the first one is testing, tracing, tracking. that's the triple t. the second thing is cleaning dangerous hand washing having meticulously clean surfaces then what i call protecting personal space, that includes the use of facemasks and then spacing. in the spacing we are basically redesigning the entire configuration of residential facilities, dining facilities. every space is being redesigned. then finally we are insisting on vaccinating not against the coronavirus because that vaccine is not likely to be ready for the fall but against the one vaccine we do have, which is the

flu vaccine. the two diseases are going to coincide in the fall >> it sounds like you are hitting all the right points again, i don't quite understand how it works will there still be people who are sharing rooms in the dorms how many students will be in each classroom what are the actual specifics? i can imagine that parents who have kids going bakr just worried about how they know that their child is going to be doing this and being able to visualize it >> yes well, that's exactly right now we were in a very fortunate situation and appreciate that not most universities are in that situation five years ago when i started we started a ten-year plan to totally renovate all of our residential facilities it happened just earlier this month of may we opened a brand-new facility we were scheduled to bring down some of the older facilities, which are still quite functional so we canceled that demolition and it turns out we have a

substantial larger number of beds than we would have otherwise have the timing just worked very well for us so we will have extra space and that will allow us to lower the density in the rooms we're also increasing the shifts for all the cleaning staff, making sure that every surface is clean and then we will introduce a very strongsort of social norm that you are expected to wear a mask. the mask is protection but it also protects everyone aroun you. it is -- it creates a mutuality of responsibility. i protect you, you protect me. they are good at peer pressure we hope to mobilize that classrooms also. >> that's great. >> creating new space for classrooms and we're blending that with online experiences on campus you blend those so you actually can have a mixed experience with some students online, some

students in the classroom rotating throughout the days of the week >> that's great news that you have those extra rooms available. does that mean any student who wants a single room will have one? >> no, but we will be able to reduce the density substantially and have double occupancy. there are a few single rooms, but where you used to have three or four students, you will now have two students and you will be able to -- if you combine the four measures, i am pretty confident we can keep our students safe. the key here is also to understand this is the population with a low risk i would not recommend this for a nursing home, but we're dealing with exactly the age group that's at the lowest risk. that doesn't mean that you let your guard down because there have been cases also among young people and sadly we have lost a

few young people but the risk in the particular age of young people and college age and graduate students is substantially low and that's why we can do this safely. the key always being testing we will have screening procedures we're developing an app working with other universities where students will self-screen any one of five, you go to the student health system for further testing. you are provided instruction in an isolated facility online. i mean, this is a very, very careful planning process >> dr. frenck, quickly, how many deferrals have you had for freshman coming in who say i'm going to wait a year >> you know, it's something we were fearing, but we have not seen it, at least not right now. we had a very strong increasing

of applications the last pfeiffer years whmpt it came the time for deposits, we were ahead of last year it's still summer and i understand a lot of families are going through hardship we may experience that we're also trying to refund funds for students and international students, most of our continuing international students are staying in the united states. everybody is adapting. because of that, we have not -- we're actually seeing a strong indication that we will have a full class come the fall, which just redoubles our duty to keep everyone safe. >> dr. frenck, i want to thank you for your time. good luck. we will be watching as we get closer to the dates coming up in august andrew >> hey, thank you, becky

great interview. when we come back, another interview. mark zuckerberg weighing in on twitter's fact check of presidt umentrp. we're going to show you what he said two big hours ahead. mark zuckerberg after the break.

facebook's mark zuckerberg goes on the record >> one of the things that we are seeing is that a strategy that a lot of small businesses are using to survive and stay afloat is to ship more to the internet where your online store front will stay open even when your physical store can't be. more of this news making interview straight ahead china has approved the controversial national security bill for hong kong what it means for investors if the city loses its special status with the united states. plus, bank of america's brian moynihan on the reopening of america and the state of financials has a great glimpse of what's happening in the economy and he will tell us right here on "squawk box. the second hour begins right now.

good morning, everybody. welcome back to "squawk box. i'm andrew ross sorkin we'll show you where things stand. maybe the great rotation has begun. nasdaq looking to open down 33 points, joe. who knows whether this becomes something we're talking about a lot. it's proposing a new national security law for hong kong ahead of that decision protests in hong kong have reigniting it.

senator pat toomey is going to join us later in this hour to discuss the latest coming out of china. andrew >> meantime, president trump planning to sign an executive order. it comes after two of president trump's tweets were tagged by twitter with a warning prompting readers to fact check the posts. in a rare interview i spoke with facebook ceo mark zuckerberg yesterday virtually. we did that yesterday afternoon. i asked him what he thought of twitter's move. >> i think we've been pretty clear on what i think the right approach is. i don't think facebook or internet platforms in general should be arbiters of truth. i think that's kind of a

dangerous line to get down to in terms of deciding what is true and what isn't, and i think political speech is one of the most sensitive parts in a democracy. people should be able to see what politicians say and there's a ton of scrutiny already. political speech is the most scrutinized speech already by a lot of the media and i think that will continue now, of course we have lions so just because we don't want to be determining what is true and false, you know, doesn't mean that politicians or anyone else can just say what they want. our policies are grounded in trying to give people as much voice as possible while saying, if you are going to harm people in specific ways, right? if you're going to do something that's going to cause violence, or if you're saying that something is a cure to a disease that has been proven to be a cure and it's not and that can lead people to either not seek

another treatment or do something that could be harmful, we'll take that down no matter who says that. we had a case recently where the brazilian president was saying that hydroxychloroquine was proven by scientists to be safe and we had to make the difficult decision of taking that down even though we want to provide as much voice as possible. so we are looking and we have to enforce that but in general you want to give as wide of a voice as possible and i think you want to have a special deference to political speech. >> as we get close to the election, commentary around the election, questions about whether we're going to have a constitutional crisis, that is going to come up could you see yourself fact checking things coming from the white house or other politicians in the united states >> let me be clear about what we

do for misinformation more broadly we have a program to make sure that the things that are spreading virally on facebook aren't complete made up hoaxes if you look at whatever the top thousand or 10,000 links being shared in a given day, some of the stuff that people share on the internet is real junk and it's completely made up and you don't want that stuff to be the stuff that's going the most viral so we have a program where we work with independent fact checkers on that to make sure that things that are completely hoaxes can be limited in their spread >> right. >> but that's -- the point of that program isn't to like try to parse words on is something slightly true or false it's really to catch the worst of the worst stuff in terms of political speech, again, i think you want to give broad deference to the political process and political speech but

there are lines. if -- we have very clear policies on voter suppression, for example. if you mislead people on when they can vote or how they can vote in a way that is going to have an effect where people might think they're voting and exercising their right to vote but actually aren't because they show up on the wrong day or vote -- think that they're voting but are doing something that isn't actually voting, then we're not going to allow that. we'll take that down no matter who says that. those are very clear policies. in general, we've tried to distinguish ourselves as probably being one of the tech companies that is the most protective of giving people a voice and free expression overall, that there are clear lines that map to specific harms and damage that can be done where we take down the content but overall, including compared to some of the other companies,

we try to be more on the side of giving people a voice and free expression >> of course, we will wait to see what president trump and the administration has planned in terms of regulating social media. separately, as you know, shares of facebook trading near all time highs it's one of the large tech companies that has done very well amid the pandemic smaller players have had a hard time i asked mark about how he thinks about being a beneficiary, if you will, of the covid crisis. >> i think that over the long term those two things are inextricably linked. i mean, our business, for example, we're really in the business of serving small businesses vast majority of our advertisers are small businesses and that makes up the biggest part of our revenue. more than 100 million mall

business so, yeah, what we're certainly seeing in dynamic where a lot of small businesses are under pressure, especially as a lot of people across the country are being told to stay home, physical store fronts are having a hard time to stay open even when they are open, a lot of people are weary about going out. what we're seeing is a lot of small businesses are having to shut down and may not survive this period. that i think will ripple through and ultimately affect everyone no one is going to be immune from that. one of the things we are seeing is a strategy small businesses are using to survive and stay afloat is to shift more to the internet where your online store front will stay open even when your physical store can't be to that end, we've tried doing a number of things we had this big launch a couple of weeks ago of a new product called facebook shops. what it basically is, it gives small businesses the ability to

set up a shop that you can attach to your facebook and instagram profile. you do it once and now people who interact with your business can byproducts, discover transactions and it's going to help small businesses stay afloat during this period. it's not going to mitigate the harm i hope it can have some impact at the end of the day, i think we are all in this together. i think that there's no future where somehow all the small businesses suffer but then people still have enough disposable income and then large businesses are fine. i don't think that's how this plays out. >> facebook did launch shops during this pandemic as a way to buy from small businesses. i asked mark whether he has seen

anything about how america is going to reopen. >> we've seen activity including people interactive with small businesses we're seeing small businesses use facebook shops and other things more, but i think it's not just one clear story where every sector is doing the same i think what we're generally seeing is some areas are on ecommerce shopping online, things like that, are recovering and growing at for that. >> joining us, what mark zuckerberg was showing us. robinson humphrey for you. >> we've been talking about working from home and working

internally for the company today it appears there might be some regulatory effort by the white house and administration over social media. how do you see yourself playing that out and its impact on the big social media companies. >> obviously we're not sure exactly what the use ultimately will be. the devil's always in the details. it will be interesting to see frankly how trump can regulate or close down the social platforms with an executive order. that said, i think the issue here is one where tlp has been a fair amount of controversy around the names and with the use, it's only going to get worse. controversy creates volatility volatility creates an opportunity for some it does have the potential of

hurting investors in the short term these are stocks that have done very, very well for the last several years. even through the pandemic. closer to the high end than the long end amazon within 5 and 10% of the high that creates some short-term volatility the fear is for the platforms to become frankly a political pinata in the election year. that's the potential short term. >> that's what i was going to say. if you can look through what may be the short term noise, unless you genuinely believe these companies can be broken up, it almost feels like they can only keep growing do you have a view that there is -- that the negative could be

that real? >> well, i think short term the negative is real only because nobody else knows what the details are. longer term -- and by longer term i mean post the u.s. elections, we think these are platforms. focusing on facebook for a second, this is a platform that will continue to grow and that 15 to 20% over the next 3 to 5 years on the top line. will grow the bottom line even faster in an environment where everybody has questions around economic growth. mark zuckerberg earlier on your show talked about shops and that effectively creates a whole new opportunity for facebook that they didn't address before we have 160 million small businesses on their platform only 5% of these businesses are paying them anything now with shops that's an ability

to bring in 155 million other advertisers to spend money on the platform from a revenue standpoint, value will accrue over time. short term, some volatility because of recent valuation letup. >> that's what i was going to ask you, given the runup and the acceleration of the power of all of these big tech companies and the stock price runup, is this something where you say i'm going to sit and wait for a little bit if you were thinking of legging into facebook stock or wanting to buy? or at these prices do you say to yourself, still not bad based on your sort of sounds like five year or longer horizon that you think this is going to be that much of a bigger business? >> yeah, honestly it will be a much bigger business over time it's really hard to, you know, think of the top or the bottom for these things

the way we've been positioning it, the names for investors, ease your way into it. understand there ace short term thoughts understand you may not be printing the bottom or the top in this case we recommend that investors keep averaging up or averaging down for the last ten years the stock has been a six bagger. not sure it will be a six bagger over the next five years, but it should be more than double over this period understanding that it's already even one of the very largest internet companies above market cap. >> final question, do you have any thoughts about the cost base for the company, expenses as the company moves to a 50% mark's talking about work from home program that could be going across the country

he thinks it's going to bring a lot more people, could build other offices in certain cities he doesn't have there already. in some cases maybe they will increase those costs >> right right. put things in perspective. a couple of years ago this was the most profitable business we covered within internet digital media. they had margins north of 50%. with all of the reg ulatory concerns and investments and hiring 30,000 fact checkers, et cetera, their margins have come down to, you know, about -- work from home would lower the overall costs going forward because you don't need as much real estate footprint. at the same time, you will have to continue to invest

aggressively to protect yourself against regulation worldwide, not just in the u.s we think that, you know, overall one offsets the other to a certain degree we think margins over time will continue to grow a little faster than revenues. certainly not in 2020. maybe in 2021. over time we think the benefit will accrue to the bottom line ahead of the growth in the top line >> okay. appreciate your time and perspective this morning thanks >> joe, over to you. coming up, walt disney world proposing a july 11th reopening date details of that plan, what it means for the company next bank of america ceo brian moynihan joins us to discuss the pandemic, the state of business, much more. here are the futures up 140 points on the doanw d nasdaq is giving back 50 points. pretty remarkable. we'll be right back.

walt disney outlining its plans to reopen this summer. the magic kingdom and animal kingdom could open july 11th followed by epcott and hollywood studios on july 15th you can expect to see masks, temperature checks and there won't be any parades, fireworks, meet and greets. disney ceo said the company is ready. >> walt disney companieshave a

long history of being very responsible. we were the first attraction based group in florida to close initially when covid first hit and i think there's a certain amount of trust in the brand and trust in the way that we operate that we'll do it responsibly and do it on behalf of both not only our guests but our team. >> we're joined by alexey quadrani it's been a grind but a grind higher, grind back i think we got as low as $85 and now back over 120. still quite a distance from 153 from the highs have you had an outperform the whole time i know this is one of your favorite picks and you've reiterated that. did you have an outperform through the last two or three months >> yeah, we did. we absolutely did have an outperform all the way down and now halfway back

we just -- you know, we don't change ratings every few weeks obviously if we had the knowledge of what happened sort of in march with the market, maybe we would have lowered our rating and said this is what the pandemic is going to drive our rating, but we really tried to stress a long-term view on disney from the beginning. we basically said in our notes, this company's going to push through this and if you're in this for the long haul, you know, this is a true overweight. >> would have been hard to get it given that -- i mean, i think of our parent, comcast, you have the cable, the sort of solid business underneath. disney has streaming other than that, you look at how they try to -- the mix of assets, it's been very, very difficult. covid has affected almost every part of the business the shanghai reopening, can you

compare that directly to what we can expect in this country that's a blueprint but is it can you replicate what happened in shanghai with the way americans behave, do you think >> i think you said it the right way. i think it's a blueprint not a perfect match but it's definitely a blueprint in a way they're much better off than some theme parks here in the u.s. they have done it to another country. maybe not exactly the same but very close to the same not only that, they've also had two months they're going to have two months between the opening of shanghai and the opening here they've had two months to say, okay, this is what shanghai looks like, this is what we look like, this is how we're different and this is how we're going to make adjustments. it's not going to be perfectly analogous but i think it's a very, very helpful benchmark. >> they manage those parks, a leks yeah. i can remember, i was offering

my kids money if they could find a piece of gum or a gum wrapper. you can't. is that something we should extrapolate, that they really do run a tight ship >> i mean, absolutely. i think you really hit the nail on the head there. i think this is a company that really is known for its brand and they're not going to do anything to tarnish it they're going to do this right they're going to open below capacity than their peers. they're going to open more slowly than their peers and they're going to spend a lot of time and money figuring out how to do it right they don't want the headline another outbreak happens at disney world they want to make sure disney does not have any other problems and they come out ahead of it. >> that would be a terrible headline, you're right >> i don't think it will happen. >> 153 is the high we're at 121 we'll check back with you and keep an eye on it. i want it to reopen. that's part of disneyland.

everytime someone wins the super bowl, we're going to disneyland. disneyland or wally world. it's tough to -- and universal we have to plug that as well >> right. >> all facing the same type of stuff and we're pulling for you. thank you. >> thank you. bank of america ceo brian moynihan will be joining us. that will be great shares of boeing are up. the company says it is resuming the production of the 737. now for today's aflac trivia question didn't get yesterday's california has the most national parks with 9 which state comes in second with 8? probably not new jersey. becky thinks s khenows we're going to have the answer when we come back. dollars. a hundred dollars. i had good health insurance. why isn't this covered? well, then they started getting bigger.

eight-hundred dollars. eighteen hundred dollars. i saved for this. but not that much. i'm glad i had aflac. they gave me money when i needed it most. that's why aflac is here, to help with the expenses health insurance doesn't cover. i love that aflac duck. aflac! get to know us at aflac.com

welcome back, everyone now the answer to today's aflac trivia question. california has the most national parks with 9 which state comes in second with 8? that would be alaska i was wrong. i thought it was utah. when we come back, bank of america ceo brian moynihan will join us. i don't know if anybody has a better take on what's happening. bank of america touches one out of every two households. they are the largest small business lender. we will talk to him about the reopening of america, the state of the financial sector, what's been happening with the pandemic and what's coming ahead. the futures are headed up.

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welcome back, everybody. bank of america counts one out of every two families in the country. they have 66 million consumers and small business clients the bank obviously has incredible read on how businesses and consumers are weathering the health and economic crisis of coronavirus joining us on the phone is brian moynihan he is bank of america's chairman and ceo. brine, thank you for being with us today >> becky, it's a pleasure.

so good to hear your voice and pleasure to be here. >> okay. let's talk about what you're hearing right now, brian i don't think anybody else has a better read on how things are going and real time data what are you seeing in terms of consumer spending? i know you said for memorial day weekend consumer spending was down 10% how does that match up with what you've been seeing over recent weeks. >> sure, becky this is a health care crisis as you see various adjustments by government authorities to the health care crisis and human crisis, you're starting to see the economy come out of the hole if you think about the months during the year that we start off strong this year with spending january last year to january of this year, january 9%, february 10%, march 17%. april was 27 to 30% down and what you're seeing in may is 5 to 10% down. so you're seeing us come out of

the -- you know, out of the depths of where we were in april. that's good news that's due to two things, one, people are starting to spend more money as the stimulus hits generally and more importantly the numbers moving faster, the impact of the opening of various economies. >> i would assume a lot of that has to do with how americans are feeling about their jobs so many have been furloughed so many have been laid off now many of the people who have been furloughed think they will be called back do you have any kind of insight into whether these are temporary layoffs, whether these are long term and i bring this up because jason furman was with us yesterday. he thinks unemployment will still be around 11% come christmas time >> yeah, i think most economists have the unemployment numbers peaking somewhere during this quarter and starting to fall and stay elevated through year end and even into next year. our economists, bank of america has the same take on it.

the interesting question is it's been very different than the situation. the economy was immediateand it's parts of the economy that never shut down. doctors offices, dentist's office, things that go on and are reception proof. we went into a recession environment and people shut down and they're reopening. that's good news it will be slower for travel and things like that to come back from the retail spaces i know you had a spot on disney opening up you're starting to see people open but it will be slower on those parts of the economy than it is on parts of the economy that are in strong demand, doctor's office, dentist's office and they'll start going there again. i think you have to think about the unemployment impact. the real difference is the amount of stimulus in the economy is much different than past crises. if you look at our customers checking balance say under

$5,000, the average balance they were running before the crisis, they're up 30, 40% in their accounts today and it's going to be spent we'll see if that can hold on until the confidence rebuilds. >> i think that's part of the question what happens when some of those stimulus measures run out, when some of the unemployment benefits run out, too? what do you think on that front? what would happen let's say around august if some of those measures are no longer continued? >> that's going to come back to the american economy especially is driven by consumer spending as you think about this, it's going to come back to the question of the consumer spending picking up and the demand for services especially on the service side of the economy picking up and as we move through the year and how fast we can cross the river where there's enough spending to

reemploy the people. that's going to be the debate. if you think about the stimulus in the economy, we think the best we can tell is it's still 30% of the eip payments in our customers' accounts have not been spent the unemployment benefits have not been strong and the administration put it in for the next few weeks there is an issue in terms of currently the cash flow is strong the unemployment numbers are very high and very concerning but on the other hand if spending picks up that will help drive the economy back to where people get jobs back we'll see this play out. how long can it last and right now it seems to be sufficient. >> i think if my numbers are correct you've gotten deferral requests for 1.6 million deferrals and maybe 180,000 of those are people asking for deferrals on their mortgages that number has slowed down. what are you seeing in those

numbers? how much has it slowed how much better is that situation looking? >> for something like in a mortgage deferral, bank of america we are a prime, super prime type of lender you've seen the deferrals in our customers' accounts fall dramatically we had 1 million in the first week and the last couple of weeks it's dropped why is that happening? i think people have adjusted asked for deferrals, they were shocked by what happened once they got that deferral in the mortgage area, 20% of the people who asked for it they got it and when payment time came they made their payment. they were in a different situation. credit card time, 45% made the payment, again, i think that's because from the time when the crisis hit to the time when they

had to make the payment, they had more cash flow than they might have thought the question for this is what's the re-employment factor that will come up in the next few months as the economy reopens and jobs restart the deferrals have slowed down and we offered people forbearance, put them on the back end of the mortgage, not make the credit card payments, et cetera. that happened across the industry that slowed down across the industry as well. >> hey, brian, one of the real issues people have wondered is what happens in retail and in restaurants where they didn't have any revenue coming in in a lot of places. as a result, many of those retailers orrestaurants were not paying their rent. you wonder what the ripple indications are of that. what have you seen on that front? what happens in terms of the loan losses you might

anticipate >> if you look at the retail spending at restaurants, quick service type restaurants continue to grow the non-quick service type restaurants fell 30, 40, 50% they're back up to where they're down 30% they were growing week after week before they starting cooking. you make it and the ppp process, doesn't fit. when you go to retail, clothing, it's been interesting. spending on clothing stores up 50% month over month people are broadening out their spending immediately after the shutdowns people basically went out and bought provisions in big numbers so we've seen some of the interviews you had for people whose numbers are very strong in march and april in terms of

same-store sales because of that provisioning what you're seeing now is consumer spending is broadening outcoming off of clothing and the question is how fast can it move up and then the supplements from ppp and how that will work and we'll see that play out. >> let's talk about the ppp a little bit this is an issue that's been polite sized pretty handily. i think those were the latest numbers i had seen and $26 billion. i think the majorityof those went to small businesses there have been lots of complaints senator elizabeth warren and others want to investigate about whether big banks put bigger clients first, their own clients first. maybe you can address that, talk about what you've done, what you've seen. >> there was quite a bit around

the first phase. how the process worked, the administration the c.a.r.e.s. is 2 months 2 days old, which is not that old. yet on the other hand $500 billion has been put through the ppp process by the industry. the large banks have done that from the first phase, the second phase. first phase closed, shutdown, reopening. we went from 10,000 completed ppp loans to 320,000 the machine at bank of america, myself and other colleagues, the machine kept turning and the sba got ready to receive the number of volumes the average loan size would come down 98% of the borrowers have less than 100 employees 80 plus% have less than 10 employees. we're still getting 1,000 apps a day. the businesses are smaller and smaller. the intent of everybody to help small businesses has been served by the volume of applications.

the balances extended went down as repayments came in and people thought twice about it you saw it drop back down. you're seeing it to broaden out. people let the clocks run and the program continue they're talking about the health of certain types of industries $510 billion have gone out on the streets in a month and a half. >> wow let's talk about loan losses banks will be losing three times the normal does that sound right to you >> in the first quarter we had chargeoffs of a little over $1 billion which basically is what we always have, then we put up an additional provision on top

of that. we still earn 20%. you'll see us adjusting in the second quarter, the industry and ourselves, to think of conditions at the end of the quarter and put up potentially more reserves. i think the real question is, you know, it's the tension of the unemployment numbers that you talk about, which are way too high we have to as a society get them down spending patterns, which will create demand which will help bring people back to work. whether it's home construction, retail, restaurants, whatever. as you see that, we feel very good we have reserved very strong we have a great credit book. we feel good about where we are. there could be losses. the intended outcome, the predicted outcome when you have this kind of unemployment and this kind of demand destruction

on the commercial side >> brian, i do want to salute your leadership about what you've said about your own company and layoffs in 2020. you've said there will be none which is pretty bold there are plenty of companies looking at this as an opportunity to trim the fat, do layoffs and do things. you have 2 r00,000 employees >> our industry and company has been open. we've had branches open. we've had tens of millions of customers come in during the covid period and call us during the covid period 5 million outbound calls we took right from the start an employee centric, customer centric view we had to be open every day. our branches had to be open. we had to support the capital

markets and the loans coming in and institutional money. the idea of no layoffs was to make our employees feel comfortable that they could go to work every day and not have them wore kbri about extending someone else $100 when kids are off at summer camps, day care centers, things like that. we've extended that through another month. even people who are high risk that we took off the line right away because of the risk involved in the situation. we've been paying them we're redeploying them for four or five weeks people could not work their job was not the kind of job that was work from home. we took the employee centered view citing to make employees comfortable. what's been interesting is our attrition obviously slowed way

down when we get to '21 and things are open, we'll work it through. i think we have great expense management and we'll continue to manage expenses well we'll let attrition and other factors work as the world reopens and the economy recovers. >> brian, we have to go. very quickly how many people were online banking now versus when this whole thing started? what's the future of the branches >> well, the future of the branches is important. over 500 thousand people the interesting thing with 39, 40 million digital users, digital sales have increased the raw number digital sales year to year is up you're seeing increased digitization the most interesting stat is the seniors and boomers. of all the new users of digital services during the covid crisis, they're 22, 23% of new users. which means people who have

never used these wonderful services we have have never used them that's a good add to our base. we have the digital platform the interesting thing is we've moved a group of people who have in the next three, four, five years done it and they've done it because of the necessity of time and that's good for us. >> brian, i want to thank you for your time today. it's great to see you. bank of america's ceo brian moynihan >> andrew, i'll send it over to you. >> great interview, becky. thank you. when we return, we'll have more of the mark zuckerberg interview. on the road ahead to a facebook and what a post pandemic workplace might ultimately look like shares of hughlett packard guidance for the third quarter was below wall street estimates. th srts attaoff at 7% right now. "squawk box" returns right after this (♪)

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there were new developments in hong kong overnight they've approved a national security bill. part of an end, an effort, anyway, to end recent antibeijing protests senator pat toomey joins us. we had senator van hollen on earlier this week or late last week, senator. it's a bill that you sponsored with chris what's in the bill what would it do

>> joe, the idea of the bill is to send a very clear message to beijing that we're not going to sit by idolly while they systematically destroy the autonomy that they promised to hong kong, that they continue to export their authoritarian system to other parts of the world, especially in hong kong so what it says is that the state department will be obligated to list those entities and individuals who are responsible for inflicting this crackdown on hong kong and they will be subject to sanctions themselves financial sanctions, including things like freezing their assets, but also secondary sanctions, which is to say restricting the activities of banks that finance those individuals and those entities i think that's a pretty big hammer to be wielding.

>> the comments that you've seen from the secretary of state recently, where do you think we're going with that, the trump administration and in addition to the steps that you just proposed, what else would that mean what's the end date? >> the potential implications of the secretary of state's decision to recognize what unfortunately now looks like the obvious, which is that hong kong does not retain the autonomy that was the precondition for a different relationship between the united states and hong kong versus, say, every other city in china, so there are things like restrictions on visas that could follow from that the president could decide dual use technology that we currently sell to hong kong but do not sill to main land china. the other big one is tariffs that are imposed on mainland

china and not imposed on hong kong could also lose that distinction. hong kong trade could be subject to tariffs as well so there's a range that flows just from secretary of state's announcement and decision, the bill that i have with senator van hollen would go in a different direction. >> can it get worse after covid-19, our relations with china, and the prospects for future trade deals can this actually -- this can actually make things worse where does that take us? are we -- do we know -- >> very hard to say, joe you know, what this bill that they passed apparently just earlier today is much worse than the extradition bill we think about the extradition bill that triggered 1 million hong kong residents to take to the streets on the idea that a hong konger could be taken off the streets and tried in a

chinese court on the mainland. this would impose the entire chinese criminal justice system or injustice system on the people of hong kong. it's pretty essential, i think, that we respond to that. are we in a bad place with china right now? yeah, absolutely they have systematically lied about this virus, they have been cracking down, including arresting people simply for advocating for their democratic freedoms, and we shouldn't forget that we are trying to exercise power and spread chower throughout the south china sea i think we're in a bad place what i'm hoping is there are some voices within that regime obviously it's not a democratic society but there's still politics and i'm hoping there will be some voices that will start raising questions about whether the chinese government under xi is moving in the right

direction. >> senator, you've been on before talking about another stimulus bill and you were pretty frank about your feelings for it have you made your feelings known to leader mcconnell about that he's now acknowledging there may be one you're just dead set against anything, aren't you >> well, joe, i'm dead set against loading up the money cannon and firing it off again to the tune of several hundred billion or the speaker of the house had her way trillions of dollars. that's a terrible idea that's a non-starter for me. could we pass legislation that would maybe make some refinements and improvements to the ppp program? could we extend liability protection to employers who are acting in good faith to keep their work force safe, things like that i'd be open to between what we've appropriated and what the fed can lend, the

dollar amount that we've authorized in the last few weeks is something on the order of $6 trillion and most of it hasn't been spent yet a huge chunk of it has gone to the states so i think it makes no sense at all to go and decide we need to spend a whole boat load more money now without even having spent the last round and having no idea of the implications what we need to do is get on with the safe reopening of our economy so that we don't need to keep trying to replace economic activity with government money, which is itself a losing proposition. >> senator toomey, thanks. >> yes, i've been very clear about that point of view. >> you certainly have. we appreciate that thanks >> thanks for having me. >> we'll hope to see you again in the not too distant future. we're going to take a look at this indicator "squawk box" will be right back. okay, we are we are seeing -- there's a bicycle, some traffic.

i saw an actual traffic jam. there are four cars going through -- this is an indicator we're going to start looking at for reopening. a few people walking around and we love new york's finest obviously and feel safe. a little more activity, but it's slow slow going "squawk box" will be right back.

good morning dow futures pointing to another strong open after two days of big gains but investor optimism being tempted by tensions in asia china moves forward with a much criticized national security law crackdown on hong kong another 2 million americanpectis

the data facebook ceo mark zuckerberg talks working from home, small businesses trying to survive online and twitter's decision to fact check president trump >> we're different companies, but i think we've been pretty clear on what i think the right approach is, which is i don't think that facebook or internet platforms in general should be arbiters of truth. >> much more from a rare interview with a tech titan coming up. the final hour of "squawk box" begins right now. good morning welcome back to "squawk box"

here on cnbc i'm joe kernen along with becky quick and andrew ross sorkin as we were just mentioning, andrew was, we're up another 184 points this morning on the dow that comes after a couple of big gains on -- it wasn't monday and tuesday, it was tuesday and wednesday, today is thursday so -- tomorrow's friday. things are moving a pace now, which we like this we like this do you really -- is five days necessary? guys, is it absolutely -- >> no, not at all. >> when did we decide that when was that decided and why is it just cast in stone? >> we didn't decide that. >> we did not. we did not >> okay. nobody askeds. >> i don't think -- >> as with most things in life >> although a lot of people are working zero days, at least as far as going into some place so strange so many weird things happening andrew >> well, talking about by the way, work from home, maybe we'll

be moving towards a four day work week. we'll see. we're going to start this hour with tech and this very issue to some degree. facebook leaning in aggressively to the notion of a remote work force for the future ceo mark zuckerberg predicting nearly half of the 150,000 employees will be working from home in a wide ranging interview i spoke with zuckerberg. our interview of course was virtual. i started out asking him about proximity to power in the office and whether that goes away as a result of the new normal >> the biggest advantages i think are access to large pools of talent. there are a lot of people in the u.s. and in canada and ultimately around the world who i think we and other companies that go in this direction will be able to access. we also see on the retention side one of the top reasons when people leave the company, they

tell us that we are leaving. they want to move to a place maybe to be with their family but we don't have an office there. we'll be able to keep more people in the loop which will be recruiting more people and they're ramped up on our culture. this overall i think will help spread the economic opportunity more broadly across the country. there is a big challenge that a lot of opportunities are only available in cities in these metropolitan areas which means that people need to choose between the lifestyle that they want and sometimes would need to move to a city and leave that in order to have good economic opportunities. people will spend more time commuting or teleporting and for us our company, so much of what we do is building products that

help people feel connected and present together no matter where they are so whether that's the main kind of feed products that we offer or things like video chat, workplace for enterprises, our hardware with portal or the longer term bets are in virtual and augmented reality. requiring employees to rely on tools will help advance future technology. >> if you are a new grad, it's

more important that you are at the office in person before putting you in the environment where you would be more on your own working remotely >> right >> there are a few things like that in terms of the most senior folks, there's certainly demand on our management team and i do think some of the most senior people will shift to work remotely more of the time but of course in these really senior roles they're somewhat unique. for me, for example, i couldn't just choose to work from home all the time if i wanted to. i have to go and meet with people whether they're partners, governments, or different folks. and so i would anticipate i'm going to spend more of my time working remotely than i did before, but i don't think it would be feasible for someone

like me to do that >> i asked him about fact checking president trump's tweets. >> we're different companies i think we've been pretty clear on what i think the right approach is, which is i don't think that facebook or internet platforms in general should be arbiters of truth. i think that's kind of a dangerous line to get down to in terms of deciding what is -- what is true and what isn't. and i think political speech is one of the most sensitive parts in a democracy and people should be able to see what politicians say and there's a ton of scrutiny already political speech is the most scrutinized speech already by a lot of the media i think that will continue

we have lines. because we don't want to determine what is true and false, doesn't mean we want to have what politicians want to say. our policies are grounded in trying to give people as much of a voice as possible while saying if you are going to harm people in specific ways, if you are going to do something that's going to cause violence, if you are saying that something is a cure to a disease we had a president saying hydroxychloroquine was proven to be safe. we had to make the difficult decision to take that down

i think in general you want to give as wide a voice as possible and have a special deference to political speak. >> as we get to commentary around the election. could you see yourself fact checking things that come from the white house or other politicians in the united states >> let me be clear about what we do you know, for misinformation more broadly, we have a program to make sure the things spreading virally aren't completely made up if you look at whatever the top,000 or 10,000 links are that are being shared in a given day, some of the stuff is junk. we have a program where we work with independent fact checkers

to work on that to make sure things that are completely hoaxes can be limited in their spread the point of that program isn't to try to parse words on is something slightly true or false? it's really to catch the worst of the worst stuff in terms of political speech, again, i think you want to give broad deference to the political process and political speech but there are lines. we have very clear policies on voter suppression, for example if you mislead people on when they can vote or how they can vote in a way that is going to have an effect where people might think that they're voting and exercising their right to vote but actually aren't because they've shown up on the wrong day or vote -- think that they're voting but are doing something that isn't actually voting, then we're not going to allow that we'll take that down no matter who says that. those are very clear policies.

in general, we've tried to distinguish ourselves as probably being one of the tech companies that is the most protective of giving people a voice and free expression overall. there are clear lines that map to specific harms and damage that can be done where we take down the content, but overall, including compared to some of the other companies, we try to be more on the side of giving people a voice and free expression >> and, you know, the success of the largest tech companies, including facebook, has accelerated during this pandemic meanwhile, it's become so much harder for the small players i asked zuckerberg about how he thinks about being a beneficiary in this crisis >> i think that over the long term those two things are inextricably linked. our business, for example, we're really in the business of serving small businesses

the vast majority of our advertisers are small businesses that makes up the biggest part of our revenue more than 100 million small businesses in the world use our services, the vast majority of which refer you so we're certainly seeing a dynamic where a lot of small businesses are under a lot of pressure, especially as a lot of people across the country are being told to stay home, physical store fronts are having a hard time staying open. even when they are open, a lot of people are weary about going out. so what we're seeing is that a lot of small businesses are having to shut down and may not survive this period. that, i think, will ripple through and ultimately affect everyone no one is going to be immune from that. but one of the things that we are seeing is that a strategy that a lot of small businesses are using to survive and stay afloat is to shift more to the internet where your online store

front will stay open even when your physical store can't be to that end we've tried doing a number of things we've had this big launch a couple of weeks ago of a new product called facebook shops and what it basically is, it gives small businesses the ability to quickly set up a shopt that yshop that you can attach to your facebook profile people that interact can buy things directly from you, discover products, complete the transactions i think something like that is going to hopefully help small businesses stay afloat during this period. it's not going to mitigate all of the harm and help everyone, but i hope it can have some impact at the end of the day we're in this altogether. there's no situation where all small businesses suffer but people still have enough disposable income to go spend money on things and large

businesses are going to be fine. i just don't think that's how this plays out. >> you can watch a lot more of that conversation with mark zuckerberg on cnbc.com becky, over to you. hey, andrew. what did you think about the differentiation between twitter and facebook i guess the kind of fine line that both these companies are trying to walk >> right. >> they don't want too alienate one side of the debate or the other but they also don't want to be accused of letting anything run rampant on the side. >> you know, i think that jack dorsey is taking a more aggressive approach and clearly, by the way, is -- will be entertaining now potentially we'll see from the white house today what kind of regulation or other steps did the government try to take against social media. i think that mark zuckerberg and facebook have tried to take a particularly measured approach, maybe a poll particular approach, if you will. it's going to get interesting as

we get closer to the election and you see heated tweets and rhetoric from facebook from both of the candidates and what gets said as, again, we get closer to the election and people do start raising questions about mail-in voetsds and whether people are trying to suppress the ee loek tore rate from coming or voting. i think it's going to get very complicated very quickly we will see. we will see whether mark zuckerberg feels like he needs to jump in and do more or do less you saw what he did in brazil. some people compared what he did in brazil and they say what did he do or didn't do in the united states it's all language and nuance in terms of how president trump has said certain things versus how brazilian president has said certain things you know, there's going to be critics on all sides >> becky, andrew, i mean, do you

think i should appeal to dorsey about a fact check the one thing that irritated me more yesterday on twitter than anything else, the wtf is that on his head? where did you get that dead animal on your head? it's -- the real hair deniers, the real hair deniers are back and those are the only ones i responded to the real hair deniers are back and i keep sending out the to you -- toupe challenge you use a leave blower. >> five years ago maybe? >> yeah. andrew, can you -- as my buddy and my -- will you confirm this? >> i will send a request to jack

dorsey fact check >> that should be taking down. >> i like that i know what annoys you now. >> real hair deniers >> real interview. if you want to see the full interview you can go to cnbc.com >> do you have his email, andrew >> dorsey? >> zuckerberg's? dorsey's >> both. >> when we come back, we've got some breaking news on jobless claims first quarter gdp and much more. a whole host of numbers on the way at the bottom of the hour. stay with us "squawk box" will be right back. (vo) our communities need help like never before

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breaking news from washington ylan >> reporter: andrew, i did get a copy of that draft order from a source and the main thrust of this executive order would be empowering the fcc with some new abilities. this order would ask the fcc to write rules on when and how platforms can and should remove content and still maintain that liability shield is so critical to business models it will require the ftc to consider taking action to companies that might violate those rules once they've been written by the fcc it also directs the attorney general, department of justice to create the working group with state's attorneys generals on enforcement of any relevant state statutes on this issue as

well in addition, government agencies must also review their spending on digital ads and review platforms on which they're spending that money for, quote, viewpoint based restrictions i want to read you a little bit of the draft order as we have it, both twitter and facebook are mentioned by name and it says that we cannot allow a limited number of online platforms to hand pick the speech that americans may access and convey online when large, powerful social media companies sensor opinions. they exercise a dangerous power. i will state the caveat that this draft is not dated and, of course, we know that nothing is final until the president's signature is on it but, again, it looks like the administration is going to be asking the fcc to do the bulk of the regulating. viewing it with current pow injuries and authorities. >> ylan, just think about what the fcc would do when hajded this executive order

how does congress potentially get involved as well >> that's right. the fcc is an independent agency the process by which this has to happen is that the commerce secretary will have to formally file a request to the fcc for this type of rule making and then the fcc will have to make a ruling we know where the administration wants to go. the question and risk for big companies is another administration comes in, how quickly could the rules change and guidance change? does the fcc then become a political football in what is a broader fight between the president and between social media companies? i'm sure congress would also have some thoughts on this as well they've been opposed, including some democrats, opposed to

rewriting parts of the human decency act. there will be questions around the scope of the action and what falls into the executive branches. >> ylan, thank you we are watching shares of twitter down 4%. facebook shares down by just over 2.2%. again, as ylan mentioned, both of those companies were specifically mentioned in this executive order. i'm sure we'll be talking about this we have some breaking vaccine news from novartis meg tirrell has more on that good morning >> reporter: hi, becky another major company jumping into the race. manufacturing a vaccine and development from researchers at harvard, mass. eye&ear and mass. general. this is going to use novartis's avexis to manufacture it at no cost it uses a vector known as

adeno-associated virus or aav to deliver genetic code this is a similar approach to gene therapy drugs avexis is approved using that. i talked to a lead researcher. one of the important differentiators is because aav is an established industry, we can tap into available capacity including novartis there is the advantage to have an established group behind it back to you. >> meg, thank you for that we'll be speaking with you, of course, very soon. we've watched all of this. coming up when we return, the latest look. this is going to be important, guys, on unemployment claims they're still expected to top 2 million for last week. we'll bring you them when we get them you're watching "squawk box"

right here on cnbc we'll be back in just a moment

welcome back to "squawk box" this morning a number of headlines in aviation to bring you. some of them hopeful others starting to express the damage done with the coronavirus. phil lebeau has the story. >> reporter: we've talked about for some time that the airlines know if business does not dramatically turn around, they will have to shed some jobs this fall now we're hearing from major carriers america sending out a letter, employee email outlining that they're planning to cut 30% of management or administrative staff. 5,000 jobs they have 17,000 white collar employees, about 5,000 of those will have to be either through an early buyout package or if not enough people do that, then

they'll have to be involuntary layoffs. those go through june 10th then they're going on to deal with the front line workers. separately, delta airlines out ceo ed bastian outlining the process of eliminating jobs. they didn't say how many at this point they plan to eliminate but this is going to be a point of early buyout being extended to employees. more details from delta this morning. we also heard about job cuts at boeing yesterday morning late in the day, however, we got other news that push the shares higher after hours that continues this morning with the fact that boeing has resumed 737 max production you now have them reserving production it's not like they'll flip the switch and you'll see a new max coming out of the roenton facility this is going to be them working

towards recertification, at least that's their plan later on this summer, and then getting that production line moving forward. guys, back to you. >> phil, jobs question because, you know, we're going to get the jobless numbers in a moment. when you look at the jobs that have just been lost at boeing, you know, we keep looking at furloughed numbers, people who keep thinking they're coming back to work these are jobs i imagine not coming back or do you think this is something that will ultimately we'll look back and think of as temporary? >> they're not coming back any time soon, andrew. these were because they are cutting down their production in the commercial airplane unit and as a result that production is coming down, staying down. is it possible three years, four years from now you start to see a resurgence in orders and they have to increase production again? yeah, that's a possibility that's not happening any time soon >> and is that the same story in your mind when you think of what the other airlines might be

planning for come october? >> slightly different with the airlines let's say somebody is involuntarily laid off or they take a buyout offer and two years from now we are back to traffic levels that we saw before the pandemic, then it's possible some of these people could come back. the airline could say we're adding flights, we need to hire again. >> phil, thank you meantime, we're seconds away from jobless claims as well as revive's look at gdp we'll get to rick santelli standing by at the me. rick, the numbers, sir. >> reporter: andrew, 2,123,000 for initial claims, so 2.123 million. last week stands unrevised at 2 point 1438 million the high water mark was 6.87 march 28th less than 1/3. still a big, horrible number but the economy is reopening the worst numbers most likely are behind us. continuing claims, 21.052

million and that follows 25.073 which was the high water mark. that was the week of may 8th this is the week of may 16th often continuing claims. always a week in arrears now i'm seeing a subtle revision on the continuing claims that move down under 25 million to 24.912 on initial claims it moves up a bit from 2.43 to 2.44 million. that's last week, of course. now let's go to durable goods. durable goods expected down, came in at 17.2% do keep in mind this started at 1992 and the worst level was august 2014 at minus 18.8. we have not hit that yet thattest a bright spot if there aren't any bright spots to be had. this is of course a preliminary number which means in a couple of weeks we'll toss it for a final number that's transportation, down 7.4. down 7.4

half of what we anticipated and last month, of course, was revised down 1.7 but i'm not sure last month april really is kind of the turning point to pay attention to finally, gdp analyzed down 5%. down 5.0% minus 4.8 expected very close on that do keep in mind thatminus 4.8 in the rear-view mirror, now minus 5 is the third worst number the worst number is down 10% from 1958. let's look at consumption. down 6.8 if we look at price index, gdp price index it's actually up at 1.4. if we look at personal consumption expenditure quarter over quarter 1.6 there's very little doubt that we've turned the quarter on the shutdown economy as many parts slowly reopen. we're going to see numbers like gdp take a long time to catch up getting back to where we were is way different than starting to

open meaning the worst level's in the rear-view mirror. >> rick, thank you. let's bring steve liesman in he's got more thoughts on the numbers that just hit. steve, let's start with the jobless claims >> reporter: you know, rick is right. these numbers are coming down and that's a positive. but you still can't ignore the headline number of 2.1 million americans filing for jobless claims, which is, you know, something like ten times the normal or the numbers we had before this hit. i'm very interested as to where these americans are coming from that are still filing claims the big states, new york, 192, california, 212, texas, 128. what's interesting about some of the other states, georgia, 164 florida, 173,000 is that some of these states are reopening so you still have this large application for jobless claims in some of these states that are reopening. now you have this decline in

insured unemployment which suggests in the rear-view mirror some are going back to work in that the question becomes one of reopening versus rehiring. i want to read you a quote from the report of the cleveland fed which is i think something people need to consider. it says, only 1/3 of contacts who reduced staff levels expected to rehire close to the full number of separated staff when their businesses reopen this expectation suggests employment is unlikely to climb back to prepandemic levels quickly after businesses reopen. the word reopen appeared 25 times in the beige book and that he was a definite positive the idea of reopening is an overall positive for the economy. the question is you're still getting many jobless claims out there. maybe people are rehiring -- i'm sorry, reapplying, were denied the first time the concern about a second wave,

not of the pandemic but of economic pain resulting from the initial shutdown wave. becky? >> steve, some of the states that you mentioned, georgia, especially florida, i think they have had problems with their setups for applying for unemployment, right? >> reporter: yes. >> maybe this is delayed reaction from some of that >> yeah, that's definitely a part of it and you have these big declines, i have to say, in insured unemployment for example, insured unemployment, which is continuing claims, fell by 1.6 million in florida maybe many were thrown off the rolls. maybe they went back to work yes, you have this problem of catch up which is the state unemployment benefits systems were not equipped for the flood of claims that came in and also many have very strict rules that don't allow people, if you don't

receive it the first time, sometimes they go back and apply a second time. >> thank you good to see you. when we come back, we've got more initial reaction from the job claims numbers that we just received another 2 million americans filing for unemployment. north laisnds glen hutchins will join us when "squawk box" comes right back these days, it's anything but business as usual. that's why working together is more important than ever. at&t is committed to keeping you connected. so you can keep your patients cared for. your customers served. your students inspired.

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welcome back, everybody. initial jobless claims, 2.1 million. that brings the total since the pandemic started to more than 40 million. joining us for his reaction, glen hutchins. glen, these numbers are kind of unbelievable still hard to get your head around what's happening. the good news is that they are coming down. >> so, good morning, becky i just want to say before we get started that my hair is authentic, too a lot of questions have been raised about that. no, just kidding i think under appreciated on this show, everybody knows joe has a full head of hair. andrew's pretty hipster haircut.

good morning, everybody. >> i'm just trying to hold onto it >> looking pretty sharp here this morning, buddy, so on the unemployment numbers, i think one thing worth understanding, the top unemployment number, 14.7%, really under measured -- under states the state of labor. right now there is almost an equal amount, almost about 15%, maybe steve liesman will have a comment on this, of the distress in the labor market. 6.4 million people have dropped out of the labor force in april. they are actually not looking for work anymore they're not counted in the unemployment numbers there are also 2 parts of the

part time work community that are very large there are part time workers forced into full-time work that increased 5 million in april, another 3% in the labor force. there are other part timers and that's increased, another 8% of the labor force. if you add all of those numbers up, you have another 15% of the labor force that is in some degree of economic distress. this is a very, very weak labor market at this point no surprise at all beneath the numbers it looks even worse. >> glenn, that's fair commentary everybody is trying to figure out how long these layoffs will last, how long the furloughs will last. how many jobs will eventually come back, how many don't.

i want to draw your attention to brian moynihan, ceo of bank of america. when he's looking at bank statements from his customers, anybody who has $5,000 or less, their cash balance is 30 to 40% higher that's obviously because of payments coming in from the government or stimulus and that's a surprising number maybe a better statistic than i would have anticipated. >> it doesn't surprise me, becky. i listen to brian. sharp guy. in addition to the policy, you would expect that to hit people's bank accounts two things occurred. one is people are precautionary savi saving during this time period one of the things that makes the cycle worse rather than spend money,

they actually save money because they're cautious and then the other thing here is that because of the lockdowns people have consumed a lot less of the stuff they would otherwise consume. so it doesn't surprise me at all. i would suggest that remember the economic pain of this crisis are in the lower echelons of the labor force. those aren't necessarily people who are banking at bank of america and they aren't people who are necessarily banked in the classic way. i'm not sure that number gives us a good view of the lower echelon of the labor force >> that's interesting to think of people hoarding cash the same way they're hoarding toilet paper and grocery supplies and everything else out there. glenn, what's the solution for this what has to happen that's the other big question. once you get to august and a lot of the government benefits run

out, some of these programs dry up unless we see something else coming from congress, what do you think needs to happen? what plans have you heard that sound like reasonable ones >> i listened to pat toomey this morning and that gives you -- on your show and that gives you a sense of what they're thinking about. there is a policy out there, two policies worth thinking about. one is there is a policy out there, comes under different kinds of names, but it's called the employee retention tax credit the idea is there are two kinds of issues. one is the $600 increase unemployment insurance when added to the $400 per week, about $1,000 a week, $25 per hour does create, according to even the democratic governors, a disincentive to work for people

who are in the $20 per hour wage category, so i think creating an incentive to go back to work is important for all of us to have the economy start to pick up again. taking the resources that we have and allocating to people who can't go back to work because their companies aren't reopening. keeping people connected to jobs by these programs rather than having them go on unemployment insurance and helping businesses of all sizes instead of small ones comes together to create this kind of policy we're calling the employee retention tax credit the estimates are you can help 59 million workers that way. i feel like that's the next phase. it sounds like there's good bipartisan support there one of the things i think we should think about, i advocated this in 2009 and i want to advocate it again. i think if we do another major

piece of spending it should be on infra structure we should allocate a consequential amount of money to build out infrastructure, modern infrastructure which would have two major benefits one would be to create very high quality jobs for a very long period of time for people. not the short term and it would represent an investment in the future imagine coming out of this crisis where we built things like the hoover dam and we came out of the crisis with a modern infrastructure that on the top of which we could then build a new economy, that would be a very, very important thing to do it would be a much more valuable thing to do for the future i would pay people to work on something that created a platform for the future. >> hear, hear.

all in favor of that always good to talk to you we appreciate having you here this morning especially. i never doubted your hair. always knew it was real. thanks for being here. >> i think you win the hair prize though, becky. >> you're deflecting, glenn. the porn staff comments. you're deflecting around the porn staff comments. >> you don't know what you're talking about. >> you've had that through thick and thin i like that about you. you grew it. it worked for you. you got 9 great mrs. hutchins and you're not changing for anybody. style be damned. >> anything you want to talk about, joe >> no. we were saying good-bye. we were saying good-bye. becky already got every great nugget that would ever be possible out of you. >> take care. >> i don't pretend i can do any better than that perfect. from you we're going to

president trump. see you, glenn. >> meantime, exactly while glenn wasbeing interviewed, president trump on twitter this morning saying, quote, this will be a big day for social media and fairness. as we've been talking about all morning, the president expected to sign an executive order today that would entail or have the fcc looking at social media in a way that they haven't before, potentially big implications for at least political speech. talking to mark zuckerberg about. twitter taking a different position than facebook we'll see what this all really means and how it plays out over the coming weeks and months. joe? >> haven't looked at twitter recently thanks, andrew coming up. much more on the markets and whether this week's rally is for real the dow's up 4% just this week and we've only had two days of trading even though it's

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with jim cramer as we make our way to the opening bell. >> in the meantime, check out shares of two dollar stores. first up, dollar tree and then dollar general both benefitting from virus era spending patterns. both companies beating earnings and beating estimates on earnings, revenue, and comp store sales dollar tree is up by 8.8%, "squawk box" will be right back.

welcome back to "squawk box. earlier in the show, we spoke with bank of america's ceo he talked with becky saying the

data he is seeing from his customers show they have gotten more government money in their accounts to spend. >> if you look at our customers' checking balances, say under $5,000 and understand average balance they're running before the crisis, they're actually up 30% or 40% in average balances in their accounts today versus 12, 13 weeks ago that means the stimulus is still in their accounts and it's going to be spent and part has been spent, but there's more to come. we'll see if the stimulus can hold on long enough until the reemployment comes back. >> for more on this and everything markets, we want to get over to jim cramer great to see you, jim. >> terrific show today just terrific. and zuckerberg and then this interview with brian was extraordinary was what i felt when i listened to it was, you know what, don't marvel too much that we can have 40 million unemployed and the market go up, because they have firepower, the

consumers have firepower dollar jerl with a number that was extraordinary, and that was the stimulus how else do you get 21% comp the people who marvel every day this market could be up so much, including some big hedge hund managers, have to listen to that interview. >> i ask you the same question i think we talked about maybe two or three days ago, which is, is this the momefront the great rotation there has been so much success in tech stocks which have clearly been beneficiaries of a lot of stocks on the sidelines waiting, maybe cyclicals, maybe industrials, maybe banks is this the time >> if the premarket matters, it's absolutely going to continue, and obviously, faang, facebook really bruised here what i see here is the semis are coming down despite the fact micron reported a good number. you get a stock lie raytheon, which has been a horse, royal caribbean, really positive, no

doubt. i don't know how long. look, the dow is up 4% how much has been factored in? how much should we say, you know what, the rotation has already occurred i say watch work day work day was up huge that's a cloud king. if that can carry on and salesforce can do good tonight, you might have a decent rotation back, but holy cow 4% of the dow, and then as brian sullivan said this morning, the small caps are roaring is it too far too fast is the question >> okay. jim cramer, we will be watching for a lot more of your commenta commentary >> great stuff this morning. >> thank you, sir. we'll look forward to seeing your stuff later today big interviews planned >> thanks. >> joining us for more on the markeds, an astaus yeah from jpmorgan bank, not a whole lot

of time left you heard some of the things jim was saying just extend that, flesh that out a little do you think we are seeing some green positive things, good rotation >> we're definitely seeing it in rotation i don't know if it's a great rotation that is really, truly sustainable for let's say the next 12 months but it's time to have more balance in the portfolios if you look at what investors have mostly done, they have moved into tech. they have moved into health care, which has been the right thing to do. they're the only sectors that were truly investable, so to speak, but we're looking for catch-up trades, and where investors can be looking for catch-up trades. so some of those are airlines and hotels and consumer discretionary type names we do think there's more catching up to do for those stocks because if you look at the mobility data around the economy, we are seeing that people are turning up at stores more they're turning up at grocery stores, retail, and noticeably,

even restaurant bookings in places like florida, georgia, texas, are starting to pick up i think reopening trade has absolutely got more room to run here we like industrials. we like home builders, and we like some key transports to actually position for this continuation of a cyclical upside trade >> jim, i know how serious you and all your supporters take your appearances here, and they have been trying to get you all psyched up, so what are you bringing us today? what do you think? >> the rotation trade i think is 80% probably a very good thing and it's pricing in the reopening of the economy, but i think there's also a little element about it as well that could be on china. that could weigh on tech stocks as well. i first had it accidentally on the short, but the thing we're not talking about the most that should be looked at is silver looks like it's potentially breaking out to the upside this is a commentary on the

dollar and a commentary on maybe adding so much stimulus and everybody flooding the world with liquidity may not be the greatest thing for the dollar. >> that's interesting, jim when you wake up in the middle of the night, what's going to throw a wrench into anything positive, do you think, the scenario >> a bad reopening i'm opening my restaurant tomorrow for outdoor seating i believe that the government actions were too strict and weren't the right thing to do, but there's certainly elements of doubt i think there's a lot of tejz. if the next three weeks numbers starts to look bad again, that could certainly throw a wrench in things or if the china situation starts to blow up a little more. >> market just has this default position of up that has to be liquidity to some extent, too, don't you think >> it is liquidity

it is policy support, and a little bit of a sigh of relief that maybe the virus is subsiding and there is a return back to normal, however modified it is. look, the biggest risk beyond tech, i would say. >> you can tell i'm getting nervous. always about watching something. in this case, it's the clock thank you. andrew, becky, let's do it again. tomorrow's friday. we don't want to forget that "squawk on the street" is next >> good thursday morning welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber coming to you live we're coming off the first close above 3k since march and futures indicate more tail winds for the bulls. despite jobless claims of 2 million plus, oil relatively steady as the reopening trade, jim, really getting flte