over racial inequality and police brutality rock most major cities the social unrest coming in the midst of the coronavirus pandemic states looking to push forward with phase three reopenings this week, a process that could now be in jeopardy all this happening as investors continue to focus on the escalating war of words between china and the united states over the crackdown on hong kong it's monday, the 1st day of june, 2020 "squawk box" begins right now. good morning welcome to "squawk box" here on cnbc i'm becky quick along with joe kernen and andrew ross sorkin. morning is rising across america. we're watching the u.s.

equities the dow is indicated down by just about 53 points s&p futures down by 10 the nasdaq off by 51 this comes after two weeks where all three of the major averages clocked gains. we're actually looking at the s&p about 10% below the high that it set back in february nasdaq is off by 3.5%. if you're watching the treasury markets right now, you're going to see right now that it looks like the ten-year is yielding right about where it has been. that's at 0.656% kind of amazing to see how little reaction there is in the market today given all the unrest over the weekend and all kinds of situations that left little of america untouched, andrew >> thanks, becky we have a big lineup of folks to talk to us about these two crises america is facing right now -- the pandemic and civil unrest as mass demonstrations take place over the death of a

black unarmed man in police custody. we'll hear from the ceo of national urban league. we'll hear from b.e.t. founder, and ken frazer, and wes moore and co-ceo melody hobson a lot of people here to help us try to make some sense of everything that's taken place around us right now. becky? >> you know, watching, again, what happened over the weekend, just the situation that's heartbreaking to watch and trying to find the reasons for it i'm glad we have this lineup of guests here today who can go through all of these issues. you know, we watched the markets. that's our job with some of these issues right now the dow is indicated down by 72 points. i have to say i was a little surprised to see the futures down 200 points when we opened up in the morning. there was massive amounts of unrest over the weekend.

again, we've watched this in the past, watched it take place in one city or another. to watch this happening in 30 or more cities around the country, watching multiple nights in a row where you have curfews coming in and putting that on top of the pandemic that already has been locked at home, guys, i think that is something that everybody's trying to grapple with. >> when i got up this morning, we were up 100 on the futures. i saw last night as well we were up 100, and then the news came out that china apparently has told some people not to buy soybeans and not to buy some pork products looks like, you know, the tensions are rising. you can see right there when that happened on the chart >> right >> we had -- and it was -- it was a little disconcerting to see the futures up i have to tell you, i wasn't looking forward to talking about the futures being up after the -- after the developments over the weekend >> unsettling all the way

around actually hearing people saying, i can't wait until we get past this, until we can get back and start cowering in our houses again to worry about the pandemic that puts things in context as to where we have come over the last three weeks. >> becky, no social -- from being shut in to seeing so many people it was like, where's the coronavirus in all this? i mean, i know that everyone was having that same thought, that this is not for trying to prevent a second wave or trying to build on the gains that we've made and trying to get this thing under control. this could be a problem in terms of so many people being so close. and not a lot of -- were there a lot of masks not a lot of masks in the demonstrations. >> that's something we'll be talking -- >> andrew? >> not enough masks. i was just going to say, you would think not enough masks

you can only hope, as scott gottlieb has said over and over, maybe if everybody is outside in the summer but i don't know i mean, obviously, the whole thing is heartbreaking by the way, so many companies also coming out over the weekend with their own statements and new efforts. mark zuckerberg last night putting out a post about facebook planning to spend $10 million, even saying himself, not enough, but on the issue of discrimination in america. but that's, of course, an issue. coronavirus is, of course, an issue. we're all, i think, just trying to sort it out and trying to make some sense of something that feels senseless across the board on all fronts. >> and small businesses, as if -- they were dealing with -- small business owners dealing with so much through coronavirus and now dealing with even more as, you know, a lot of the companies -- or the businesses being affected in a lot of the cities are small business owners

i don't know how that plays out. anyway, we're waiting for john hope, it will be good to talk to him after the break. coming up, new details on how china is using the seeds of discontent in u.s. to justify its actions in hong kong a live report from beijing is next later, we'll talk about the successful spacex launch that was really cool, i got to say. juxtapose everything else, we're in a surreal period here anyway, spacex launch of two astronauts on saturday what comes next for elon musk? "squawk box" coming right back you doing okay?

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welcome back in. the protests that rocked the country have opened the debate about how soon so open the economy and the deep economic divisions and civic unrest that exist in this country right now. joining us to talk about that is john hope bryant, founder, chairman and ceo of operation hope john, what were you thinking as you watched this play out this weekend? >> just immense sadness. ambassador andrew young, who was with dr. king in the civil rights movement, we cried. we cried him, because of all he gave, his life he gave for civil rights and for believing in the

goodness of people and giving his life so that young people could have life and me because i feel like i hadn't done enough and haven't talked to enough people. didn't lay enough train tracks and didn't open enough doors for young people to feel that they could focus on getting to work at 6:00 in the morning and be at their desk and watch "squawk box" and focus on their opportunity versus how to get to work safely or get home safely you know, we'd like to think we're beyond this as a country, but obviously we're not. and we've been bad parents, as a nation we haven't taken care of not just our children, but everybody else's as if they're our own we're better than this as a country. we're better than this as a country. we're some of the most inspiring, aspirational, leaders in the world we created a country from nothing. and we need to live up to the creed of this country and its

constitution and its bill of rights and be courageous and do some things that are out of the box, once again. a new way to reach across divides, build bridges once again. we are all in this thing together so, i was deeply hurt. i am very hopeful we'll get through this, but i have been sad. i've been sat. >> yeah, i think we all have that sums up a way a lot of us are feeling now. i think the big question is what can we do, particularly when we're dealing with this pandemic and the economic fallout from that, that i think is only going to add to the inequality in this country. what are some real policy solutions and potentially some business solutions, too, about how we try to address some of these issues and move from here? >> i think the first thing, you

know, rainbows only follow storms you've heard me say this before. you cannot have a rainbow without a storm first. and nobody changes in good times. why would you? we only change in bad times. these are some bad times these are challenging times. it's time for radical transformational change. first we, we have to get our heads right. we have to get our head in the game i'm reminded of the ceo of coca-cola, robert woodruff in the 'six when dr. king was alive. dr. king won the nobel peace prize. when he came home, this story not many people know he came home and the business community in atlanta wouldn't -- wouldn't honor him refused. the mayor called the ceo of coca-cola for help and the ceo gathered everybody in the room, the business leaders and said, look, let me explain this to you very quickly i run an international supply chain company. if you can honor this man, we're going to move out of this backwards town because you don't understand how the world works

well, they honored him the ballroom was full. all people see is the fact that the ballroom was full. that's the image the world saw we need leaders like robert from coca-cola who use the power of their brand, the power of their balance sheet to force a new vision of what's right in this country. i was talking to zander, who will be on your show a little later from survey monkey, he gave a brilliant answer to your question it's the balance sheet reimagine your balance sheet -- not your balance sheet, your budget what do you spend on advertising and where. where are your internships where are you getting your apprentice tisships? where are you spending your advertising dollars? who's covering your investment funds? look at your budget and use your budget as a way to reimagine how you can have an impact is your lobbyists only caring

about your own interests are they also saying to washington, d.c., hey, we need you to have policies that encourage internships, we need policies that award apprenticeships at scales, give everybody financial lit racy k through high school is no longer enough. k through college, minimal education, because ignorance is banished with exposure and education. we need access to capital for all levels of society because steve jobs, if he wasn't adopted by a family in silicon valley, he might have been adopted by a single parent in detroit unless he was lucky, we would not have the apple we have today. he was a jordanian immigrant who was passed away from family to family he got lucky luck of the gene pool. ended up in silicon valley voila, you have apple. how many steve jobs are there sitting in inner cities in

america who could add to gdp i'm not asking for charity i'm asking for a handout i'm not asking for anything. i'm saying we need a necessary investment in the revitalization and reset of a new america, the redawning of gdp that needs to be a conversation in corporate boardrooms and legislative halls and states and in washington, d.c., for a new plan >> john, i love the story about coca-cola. that is not one i was familiar with so, thank you for bringing that to us. you mentioned a martial plan, what would that look like? what would that entail >> i'm not talking about the justice of peace there has to be justice for george floyd and the george floyds of this country there's hundreds of young black men who can't come on "squawk box," who don't have the ability to go to the white house, who are just being -- who are suffering because they're black. it's just not right. the justice system has to be

fixed by all officers. i have reason to believe there's a movement for that in washington, d.c., right now. there needs to be bipartisan, not just one party, focusing on that so, justice for all people, not just wealthy people. all people and then the second piece of this is what i'm focusing on, where i could have an impact, the movement is about education for all and financial lit racy for all. who's teaching our children the basis of how this economy works? basically no one basically, figure it out for yourself i can't say this enough. apprenticeships for all incentivized through the tax system so companies are not just doing it out of the goodness of their hearts but thash rewarded through incentives we respond with incentives and penalties. i think we need to have capital

access for all i mean debt -- low-cost debt for homeownership, small business ownership, and accessible equity we need our youth to start businesses you be honest, you come out of the penal system you might have been a genius because you're a drug dealer. you're a dumb business plan, not a dumb person, put about you have the wrong role model. if you hang around a drug dealer, that's what you want to be we need to pick that same entrepreneur dwrit comigrit comf the penal system they can't get a job because of their record let them earn their way back into society's good graces i won't bother you with my whole plan but i have put together a new martial plan similar to after world war ii where mainstream respondents, after world war ii, we gave them as much education as we should shove down their throat, low

cost mortgage for a new home, and we call that middle class today. why can't we do that again it's the greatest nation and the world's biggest economy. >> john, we've been talking to you for a while. i know this is a plan you've been working on and reaching out to people in washington on what's the response that you've gotten to date and have you heard from anybody since this weekend's events >> i have gotten some positive responses. it's been starts and stops i've been made to be very hopeful certain things could happen, and then i get a call, well, plans have changed i don't want to start naming names because the thing may fall apart again. i got a call as early as saturday morning saying there are possibilities for it you know, i will tell you that this is what both the democrats and republican leaders are thinking about i can tell you, if this happens, it will be bipartisan. the last interview we had around

the earned income tax is how to get living wage around african-americans. the living wage helps everybody. all we do is take that money, put it back in the economy, help the investor class watching your show we're not talking about a giveaway program to get it up to the point where they can afford more than a roof over their head, rent, food on the table, car note, where they're ready to invest in the economy and live a life is through the earned income tax credit where we all participate versus putting it on businesses. businesses say, i can't increase wages 20%, 30% if we all added to that, and i've been talking to treasury, by the way, i had a very long conversation with very senior treasury official who thought it was a very good idea and has put a team on it i've gotten little conversations, i have conversations going on with the comptroller of of the currency,

this conversation with the treasury, other conversations in the house and senate, another conversation at the white house that have to be broadbased i'm encouraged there might be something in the next few days i've been -- ever since the rodney king riots. that's where operation hope was founded. i don't want to get ahead of my skis a lot is at risk people have to believe in this democracy. we have to fight for this democracy every single day every day we have to get up and fight for this democracy and renew it >> you know, the rodney king riots, it's been 28 years. it's hard to believe, all the way back to 1992 since that happened what you're talking about with the earned income tax credit, i've heard support from both republicans and democrats on this, and from business leaders who have talked about it pretty effectively. i think you can compare it and contrast it with some other

plans out there today. i've heard of other plans we've talked to leadership recently from the senate and from the house. just this idea that you would pay people to go back to work or give them a bonus, let them keep some of the unemployment as they go back to work to make sure it's bolstering there. what you're talking about with the earned income tax credit might be a better proposal because that's long-term change, something that's structural and not a one-off that disappears once things get back to a more normal situation john, i hope you do get some steam picked up with that. that's certainly an idea we've talked about on this program i would love to hear more on talking to people at treasury about this and thinking that this is potentially something that could come now, i guess the question is, how quickly would people on the right and left from the senate and house jump on board, too? >> well, you know, the magic of dr. king is he found a way to make the important feel urgent

people in washington come there with the best intentions, they want to do the right thing and they end up doing the urgent every day and doing what the lobbyists say they do and the big donors they mean well but they're speaking to these powerful interests that have their attention. we need them to understand that societies don't created from the top down, they are created from the bottom in. this beautiful democracy can go away if we don't treasure it, we don't protect it i'm not trying to scare anybody. i want to inspire you. i shouldn't have to scare you. look what has gone on the last week we've been bad parents, bad mentors, bad role models we've been too selfish, too self-centered. look, i tell my friends who are wealthy, i need you to treat poor people better if only to stay rich. i need my rich friends to treat poor people better 70% of this economy is consumer spending i'm not giving some liberal

dream. my ideal political leader has a republican head and a democratic heart. i'm a get it done party, not a political party. earned income tax credit proposal you just outlined and i suggested is a win-win this will be the first upgrade of our living standards for the average american, including middle class, since warld war -- well, after world war ii, when the middle class was created '70s, specifically the first roeal boost in income. if the average worker felt they were getting a boost every year just for working like wall street, it puts us all on the same street for the first time >> john, i love your ideas we appreciate talking to you always, but especially this morning after all the unrest and all the heartache we've watched over the weekend and beyond that we really appreciate your time today.

we look forward to continuing this conversation. i hope you'll keep us up to date with what you hear on your martial plan and also this part of it, the earned income tax credit we would like to follow along closely. >> i will do that. thank you for being a light on the heel, particularly in moments like this. we're in all of this together. we will rise we're the greatest nation in the world and we're about to prove it once again. i'm convinced leaders watching your show are crying just like me >> thank you, john we will talk to you very soon. it's really good to see you, my friend. >> thank you very much >> thank you andrew >> this three hours is going to be heartbreaking we'll see john in the 7:00 hour as well. when we come back, investors watching china very closely as beijing tries to use the unrest

in america to justify its crackdown on hong kong a live report from china after the break. take a look at the biggest premarket decliners in the s&p 500. "squawk box" returns after this. ♪ it's only human to find inspiration in nature. and also find answers. our search to transform...

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chinese state media, government officials using the u.s. protests over the weekend to sow new seeds of discontest and distrust around global democracies as it tries to justify its own actions in hong kong let's get to eunice yoon in beijing. eunice, if you could give us what you know or the latest on grain purchases and the facts behind that story that came out a little bit earlier on the soybean front. good morning >> yeah, that's right. good morning to you, too before i get to that, i'll get to the chinese state media reaction that you were talking about. the u.s. protests have really become, i would say, a convenient marketing tool for beijing. today, as well as throughout the entire weekend, the u.s. protests have been on tv, in the papers, really we've seen some

wall-to-wall coverage because they've been described as a reflection and mirror of the u.s.'s so-called chaotic values. also china has been accusing the u.s. of double standards when it comes to protests saying washington is very eager to clamp down on its own protesters but is highly critical of beijing when it comes to beijing's desire to crack down on its protesters in hong kong in fact, one of the most commonly used phrases and mocked phrases in state and social media these past couple of days is "beautiful sight," this is after the global times editor had rhetorically asked house speaker nancy pelosi if she would describe the u.s. protests as a "beautiful sight" in the same way she described the demonstrations in hong kong. officially foreign ministry spokesperson, when challenged on

twitter about the new laws that beijing plans to impose on hong kong regarding national security, she posted one line, and that was "i can't breathe," which is, of course, the famous last words of george floyd today the ministry said they would come up with more countermeasures, and this is after u.s. president trump had said on friday that the u.s. was moving towards pulling the treaty, the special status the u.s. has with hong kong. also, guys, one of the things we heard just in the past couple days is that the government here has been instructing state-owned agricultural firms to pause some of their purchases from the u.s. and that was one possibility that a lot of people were concerned about, at least in the market, that it could happen

that this tension that we're seeing between the u.s. and china could eventually lead to the trade deal ending. >> yep eunice, thank you. it is -- i don't know, propaganda, right? it's annoying. there are differences. we've got our issues here, obviously, but taking -- you know, taking an opportunity to say, look, every protest is the same is -- just doesn't seem -- it's disingenuous but it's more of the same of what we've been hearing, disinformation from china in recent months >> yeah. just watching it from here, i mean, and seeing what's being said in the state media, one issue that has not been discussed is the fact that in the u.s., the police are actually look as though they're going to get prosecuted or at

least chauvin is going to get prosecuted in hong kong we don't see any movement for the police to be prosecuted at all. that is one line of thinking that has not been discussed in the state press here >> eunice, thanks. keep us updated on all things related to trade as well, as we watch, you know -- as we watch developments there being impacted by all these things anyway, thank you. >> joe, over the weekend there were some moments that struck with me, so many heart breaking moments and then these incredible moments of warmth where, for example, in camden, new jersey, you saw black and white police officers marching with the protesters, helping them carry some of the signs marching along together. saw similar signs in other places, like in new york where some of the officers were taking a knee with the protesters and shook hands and hugged afterwards. >> hugged. >> yeah, actually hugged. >> i'm thinking, no, don't hug,

don't hug. the whole back drop is insane. it's like, oh, my god, a hug >> here they are actually wearing masks. the police officers -- this is camden, new jersey >> i'm ready -- in certain instances i'm ready to throw caution to the wind. >> everybody could use -- here it is in new york city where the officers were taking a knee with the protesters that's afrz where they hugged. i also saw the sheriff of the county in flint, michigan, where he asked them, what can i do with you they said, march with us he he did. here's that footage. here are some of the images i was holding onto this weekend, recalling our better selves and what we can do together. you're right it's the scariness of what's happening with this pandemic let's hope this doesn't create some sort of a second wave, but watching this over the weekend, there were some incredible moments of hope. i'm kind of holding onto that

this morning, too. when we come back, protests erupting across america just as the country was beginning to reopen from the pandemic we'll talk about the impact on the economy, what this all means. that's next right here on "squawk box. these days, it's anything but business as usual. that's why working together is more important than ever. at&t is committed to keeping you connected. so you can keep your patients cared for. your customers served. your students inspired. and your employees closer than ever. our network is resilient. our people are strong. our job is to keep your business connected . it's what we've always done. it's what we'll always do. try nature's bounty sleep3, a unique tri-layer supplement

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good morning, everybody. welcome back to "squawk box. we've been watching the u.s. equity futures on this monday morning. kind of unbelievably at this point, the dow futures are down, but only by about 25 points, given everything we watched take place in this country this

weekend. s&p futures are down by 7.5. the nasdaq down by 47. we've been talking about some of the tensions with china and what might happen from here as far as the trade deal goes. in the meantime, rush has approved an influenza drug to treat covid-19 and will deliver it to hospitals this month they say the drug shortened recovery times in preliminary trials that drug was developed in japan as a 50/50 joint venture in the next hour, we'll be talking to dr. scott gottlieb about this treatment and the coronavirus risk to people protesting in close proximity over the weekend andrew >> thanks, becky meantime, widespread protests are happening across the country just as the economy is beginning to reopen. steve liesman joins us now with more on the potential impacts. steve, good morning to you >> good morning, andrew. yeah, there's little doubt the

demonstrations for social justice and the riots that are going on present new challenges to an already challenged economy. loss of life always the most important concern at all times also, though there are concerns of delayed reopenings, undermined confidence to return to work and the stores and new spreads of the virus, which has been a top concern at the federal reserve. medley global advisers writing over the weekend, quote, the reopening could be disrupted and that can affect local state economies that just began to ee meshlg from the pandemic the reopenings have been a cornerstone of the optimistic view on wall street. data this week was always going to challenge that optimistic view let me go through what we have this week. ism manufacturing at 44, ism services forecast to come in at 44.5 both of those are absolutely awful numbers, but they're better than the more awful numbers from the month of april. thursday jobless claims, 1.77 million, an awful number, but

better than the awful number the prior week of course, unemployment seen declining by 8 million the unemployment rate seen shooting up to 20% now, we've got a new metric out there i want to share with you which shows the good and the bad that's out there jpmorgan is now releasing daily credit card spending data that gives us a clue as to what's going on and this chart, i think, by itself shows what's going on in the economy. on the one hand, it had fallen as much as 50% lower year-on-year it's climbed back up but it's still almost 20% below what it was. not as bad as it was, but still pretty awful finally, guys, you don't draw a straight line between the economy and these demonstrations and the unrest out there but there's little doubt, and it's worth remarking, this downturn has hit low income americans and people of color than harder than most. for that, there are obviously short-term and, unfortunately,

very long-term solutions to both andrew >> steve, before you go, just when you look historically, and unfortunately, our history is so pockmarked by these types of moments, is there an historical comparison worth thinking about? the conundrum -- not conundrum but conundrum in terms of modeling is we have covid, which is something we haven't had to contend with before. but when you look at moments where there have been civil unrest, what it's done to the economy. >> you don't see a lot of impact, andrew in part because, you know, what happened in '68, happened in a fairly good economy. and when things are, at least at this point fairly short-lived, they don't have a big impact i think you sort of -- your question hit the nail on the head in the sense that these demonstrations, calls for social justice and riots happened at a

time when we're dealing with this pandemic. and that has a different impact by itself. so, you know, history's not even rhyming in this sense. history is really being made as we deal with these two issues simultaneously as i suggested, not wholly unrelated. >> you might recall after '68, you know events we got in 1974 i'm not saying there's any correlation -- there's -- there's coincidence but not necessarily causation. but we went through a period overall where we made very little headway in the financial markets for about 15 years i think we hit 1,000 on the dow in 1968 and we didn't get back to 1,000 until 1981 or '82 i'm not saying it's due to unrest or anything else, but that's kind of a rhyme, it just doesn't -- it just doesn't mean anything, i guess, with the past. >> i mean, you had obviously the

inflation of the '70s. >> vietnam war. >> the opec issues. >> you had all - >> vietnam war, the end of the vietnam war. >> watergate. >> a lot of issues out there. >> watergate so, it's not in a vacuum. >> look, nothing -- nothing's decisive, joe. that's sort of one of the good things about the american economy, is how dynamic it is and able to absorb shocks. so -- but the issue becomes if things pile on top of each other. wall street, to my mind, has been sort of immune from the yut look on -- the uncertainty about the economy and it's looking ahead a year to the return here. but this is just more for it to deal with and to think about in terms of, look, things are coming off the bottom, but how bad do they remain for how long? >> steve, thanks i mean, we do cover the economy so we're actually going to talk about stocks, even with everything that's happening, we

still cover this we've got a great analyst to give us her thoughts on how to respond to this, if you're an investor or -- we all are. we're all trying to do the best for our families over time b of a securities, head of u.s. equity and quantitative strategy if you didn't, savita, lick we dade everything with the worst pandemic we've seen in 100 years, suddenly we were back above 3,000, which was crazy enough, i think, and now we have this anything happening flow that changes your overall outlook on whether you hold stocks or what to do with your assets at this time >> yeah, joe, i think it's a great question you know, i think that really what we're looking at right now is an environment where the market has reacted to expectations of positive news

and second derivative, as steve pointed out. now i think what's happening over the weekend, the tragic events and the aftermath really signal that, you know, we're in a pretty fragile environment both geopolitically as well as economically it feels like a coiled spring in terms of extreme positioning so, even if you look at the economy, we've seen this sort of hollowing out of the middle class and idealogically we've seen polarized politicalism. i think it's all sort of setting the scene for, you know, civil unrest, which has probably been in the works for, you know, a couple of decades now. and i think what's more problematic is that what we've seen so far in terms of what policymakers have been able to inflate, and we all know this, but we've only seen asset inflation. we haven't seen this actually kind of turn into real gains for the man on the street. and i guess when i look at the

market, i see also this very extreme positioning of investors. so, i think the opportunity today from an investment perspective, stepping back from all of this, is just thinking about your portfolio the positioning of fund managers today is at almost all-time extremes in terms of owning the stay-at-home kind of growth, you know, kind of tech beneficiaries and being very underweight the old economy parts of the market. so, the clafkt exampssic exampli is financials. it's now carrying the lowest exposure within mutual funds, hedge funds. so, i think that if we do see any sort of reopening activity that's clean and we don't see kind of a high probability of a second wave, there are some old economy participants in the market that have shrivelled up,

the smallest market caps we've seen, that could actually, you know, come back to life. and i think those are some of the areas where it might be worth taking a little bit of added exposure to. when i think about the long haul, i agree with you i think when you look at what happened in '68 and the subsequent five to ten years, you saw lower returns for risked assets i think that what we can expect to see over the next five to ten years is lower returns for risk assets like the s&p 500, maybe 4% to 5% returns per year rather than the 6% to 7% returns we've seen in the past as you know, and i've said this to you before, i still think stocks are a much better bet than bonds. >> well, savita, we're getting 5% a year, kind of scary to be out of the market when -- when we were up 4% in april -- i'm sorry, 4 in may and 13% in april. that's kind of crazy if you missed that 17%.

but, you -- at bank of america, you have a pretty good idea of what people are doing in their accounts and before -- one of your recent notes, it feels like years, but it was on may 21st, a lot has changed since then, but you did point out that equity allocation among all of b of a's clients were down 3% while cash allocations rose nearly 14%. you were able to calculate there's $1 trillion on the sidelines if the reopening went okay and if certain positive things happened. there is dry powder with your clients at least. >> absolutely. yeah, no, i think there is absolutely dry powder. i think the positioning is still the most -- the strongest bullish signal for owning stocks we're still in a world where equity positioning is light. here's the thing, i think if we see a clean reopen, you want to be in stocks and value because

growth is crowded and expensive. i think what's happened over the weekend and what we've seen in the u.s. relative to other parts of the world, even china's friction as we move towards the election, i don't know if we'll see a clean reopen i don't know if we'll see the consumer bounce right back to the levels of spending we saw at the end of last year so, i think i would -- i would tread carefully at this point. you know, again, i think the -- the way to navigate this market is to look for yields, safe yields, and safe income in an environment where bond yields are once again zero. so, you know, i think that's kind of the mantra that we've been expressing to clients, that i think still holds, especially after the recent events. >> savita, thank you we appreciate it we see you a lot we'll see you again soon hopefully. >> thank you >> you're welcome. andrew >> thanks, joe as you guys are talking, the market turning positive there for a moment meantime, if you want some good news from over the weekend,

here it is a milestone for spacex that took place over the weekend the company successfully launching two astronauts into space from american soil we'll talk about what's next for elon musk right after the break. >> entering the international space station.

welcome back to "squawk box" this morning saturday ushered in a new era of space exploration. spacex successfully launched two astronauts into space. on sunday the commercial space capsule docked at the international space station. what does this mean for what we're going to call, elon inc. joining us is adam jonas it's good to see you on what was a weekend of what felt like terrible news for this country this would give you some hope for humanity it's nice to see you try to just extrapolate out what this does mean in the larger context of elon, inc, and of

course tesla which is a publicly traded company and spacex which is not. >> thanks. i do appreciate cnbc and your program for bringing attention to space i think as you mentioned, the timing is very important we need it we need moments like this. look, it's no secret elon spends more time on spacex than on tesla. he's clearly the most important in the u.s. space program at a time when there are some gaps, there have been some gaps that we need to catch up technologically, otherwise, space situational awareness. what you saw over the weekend, folks, it doesn't happen without elon musk. this guy, he gets a lot of grief at times, some of itself-inflicted in the markets and media for some of his statements and actions and things, but when you see what he's doing, it does remind you of kind of the likes of howard

h hughes and edison that take personal risk. they don't always get it right but they push the boundaries and get it right maybe it's time to cut the dude a little slack >> how much farther ahead is spacex from everybody else in the field right now? >> well, it depends on which discipline of technology you're referring to but the one that stands out the most would be cost of launch and rocket reusability, right? i mean, what's technologically as impressive as docking, you know, with a space station and low earth orbit is landing that first stage falcon 9 rocket on a drone ship in the middle of the ocean. that's some pretty high tech stuff. if you think the technologies that are at play to do that successfully, very, very high

success rate and accuracy, think of the purpose -- think of the other applications that could have in autonomy, in other theaters, let's say. and that's what's got i think the d.o.d. very interested it's clearly gotten jeff bezos's attention at blue origin he wants to be the most important person in space origin we're recognizing technological rivalry. clearly some rivalry on the geopolitical side which is adding so much more influence to this new space race. it's going to be incredible to watch. >> adam, do you imagine that spacex will ultimately go public if not or even if so, is there other ways that investors can get involved in this story >> so as you mentioned, yeah, spacex is a private company. we don't have coverage of it we do profile private companies in space and autonomous and

transportation at morgan stanley. we have quite an evolved collaborative way of tracking importance the companies in various industries to their colleagues and the public mainly to understand the impact on the investment community and also because many of our clients are able to make direct investments in these companies while we don't have recommendations, we can have analysis and insight will they go public? one of the reasons why we modeled spacex launch and satellite deployment going out a couple decades was to find out when they might need access to outside capital. it doesn't guarantee a timing, but in our minds we're thinking to do the ambitious plans they have and the capital intensity of tens of billions of dollars to put into orbit and even on earth to work with those systems, we're thinking a couple years, that frame. not five or ten but a couple

>> right adam, we appreciate you joining us this morning. it was historic over the weekend and for a brief moment i think gave us all a lot of hope. so thank you again we look forward to talking to you again very soon. joe? andrew, thanks coming up, walter isaacson and marc morial will join us talking about the two crisis america is facing, the pandemic, civil unrest following racial inequality and police brutality. "squawk box" coming right back

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and with america's unemployment rate currently at nearly 15%, with all of this -- will all of this slow a faster consumer led economy that we've been hoping for? the road ahead could be longer than expected. we will bring you those stories and corporate america's response to the growing crisis in america

as the second hour of "squawk box" begins right now. good morning and welcome back to "squawk box" right here on cnbc. i'm andrew ross sorkin along with becky quick and joe kernen. a tragic couple of days. real questions about where we're all headed hopefully we can offer some hope this morning as well right now, by the way, u.s. equity futures at this hour, it looks like we are -- well, this is interesting because we've sort of hopped around. we were in the red, now we're in the green. 42 points higher on the dow. s&p 500 looking to open, well, just went from the green to the red but just marginally there. nasdaq looking to open down 17 points joe? >> andrew, it was a one two punch obviously for state budgets across the country first the coronavirus, now add

to that civil unrest ylan mui joins us now with more. hey, ylan. >> reporter: joe, of course state and local leaders are still taking stock of the personal and physical damage from the protests, but they're also bracing for a fiscal hit as well the budgets of many of the big cities where the protests have been taking place have already been under strain from the coronavirus. just a few days ago atlanta's mayor keisha bottoms said they're facing a 35 to $40 million revenue short fall this year and that she's, quote, squeezing every dime meanwhile in los angeles mayor eric garcetti said layoffs can come over the next several months the national association of counties said the pandemic i expected to cost them $144 billion through next fiscal year it said the protests may add to the economic volatility the counties will work to protect our residents and keep our communities safe

though there are no hard numbers around the costs of the protests, as a point of comparison, back in 2015 in the aftermath of the death of freddy gray in baltimore, the city estimated that the costs of responding to those protests was $20 million. >> thank you very much. he's the president and ceo of the national urban league. thank you both for being here. >> good morning. >> it's good to see you both

we were talking about events that were happening everywhere from fargo, north dakota, to nebraska to tampa and salt lake city marc, i wonder if you can talk about the massive issues facing cities everywhere. what's happening here. what can we do >> the george floyd issue in minneapolis struck an aorta in american life. that's why you see protesters of all races, kreedcreeds, colors, religions taking to the streets. most are peaceful. many have the intent of being peaceful and there certainly have been those that have intervened and have turned these protests into something much more ugly. but what these protests i think help us understand -- hopefully will help us understand is that the underlying issues of the

police system, the criminal justice system, economic system has not been kind or fair i think this has been building for some time. we talk about the policing issues, whether it was trayvon martin, eric garner, tamir rice, names that were in the media, high profile cases in not one of those cases were the police officers who took the lives of those innocent, unarmed people held accountable and so when people saw the videotape of how mr. floyd was literally murdered on the streets of minneapolis with two officers holding him down and another officer on his neck and a fourth officer standing watch with citizens witnessing it and then exhorting the officers to give him his breath, it struck a chord and people have said enough is enough on that issue and i think we've got to

understand the pal pability of this anger and how widespread it is and why this is an important moment for this nation >> marc, the urban league is calling for justice first. they want to see those officers brought in and held up for what's happened here, correct? >> yeah. what we want -- we think that the other officers should absolutely be arrested, and let's not forget the brianna taylor case in louie have i, the ahmed arbery case in georgia all of these cases which are high profile cases are just examples of a broader problem with respect to the relationship between police and communities and the fact that, yes, we can continue to say most police will do it. yes, okay, let's underscore that, but something is afoul with the system because it doesn't hold bad police officers accountable and good police

officers feel pressure to cover up for bad police officers we like to see -- we think it's only just that those other three officers be immediately arrested and charged. we see no reason for any continued delay. justice must be brought. we must seek justice for mr. floyd. >> hey, walter, let's talk a little bit about what's happening in these cities and of all the other titles we mentioned, we did not mention that after hurricane katrina you were vice chair of the louisiana recovery authority you watched what it took to rebuild the city thinking of coronavirus and this pandemic and how much of a larger role it's played in cities at this point because of the close crowding, because of how difficult it is to social distance in places like that and then the economic fallout from that, too, how do you go about at this point trying to say here's what we need to do to help reopen some of these cities, rebuild things, particularly with what we

watched over the weekend taking place too. >> starting with hurricane katrina, it reminded us that when you have disasters like this, it happens with a virus, it happens with a breaking of a levy, it tends to devastate the poorest communities first and it tends in the case of katrina and the coronavirus here in new orleans to devastate the african-american community first. but it also symbolically and in reality reminds us that we're all in the same boat, we're all in the same community, all breathing the same air, all flooded by the same waters and we're going to save ourselves by rowing out together or sticking together what we haven't been able to do in many places is make this a sense of community it's become a divisive issue unlike katrina coronavirus, whether or not you're walking down the street wearing a mask becomes a political partisan issue so i think step one is to have a great set of leaders, keisha

bottoms being a good example marc morial was one of my great leaders down here in new orleans, he was my mayor, and his father his father had to go through some really difficult civil rights times even canceling mardi gras at one point and a show down with police not on violence but other things. we don't have strong leadership in most places the places we do have it are cities like atlanta and hopefully new orleans with marc swam, latoya cantrell doing a great job saying, hey, we're all in this together don't trash our cities or businesses it's a tough sell when you're being hammered by an economy, you're being hammered by a virus, you're being hammered by images of police murder. >> marc, with that as a setup, let's talk about a city like new orleans or other large cities

around the country, what you'd like to see happening. what sort of policy can be put forth at this point and how business leaders can work together with policy leaders >> immediately, and this is before what we've seen in the last week, it is imperative that congress act very quickly to pass the heroes act, to pass provisions that are going to give state and local governments sustainability dollars to get past this decline in revenues, which are a direct result of the physical distancing, the self-quarantining and the sheltering in place that is taking place to respond to corona if not, we're going to see millions of city, county, and state layoffs. i don't think the senate should drag its feet one more day they should go in with a vote of confidence to america's cities and states that is a short term but a very critical short-term measure that needs to take place today.

in the long term, becky, i think we've got to think about this in 21st century terms it's time to expand the earned income tax credit. it's time to create a basic living wage for all-americans. it's time to consider things like universal basic income, down payment assistance. the national urban league put forth a few years ago a comprehensive main street marshall plan which called for significant investments in infrastructure, including affordable housing, including community infrastructure and human infrastructure, which is education and training and the things we need we need a long-term plan we need to think of this in21s century terms. we need to be bold we need to be imaginative and we need to understand that for this generation this is a time when we've got to rise to the occasion it's going to take some boldness it's going to take some risk. >> marc, it's joe kernen. >> hey, joe.

>> it's great to see you i was watching yesterday and professor cornell west was on, and one of his comments on one of our competing cable networks was america is a failed social experiment i heard that and initially i was like, that's disappointing and i think there's been a lot of successes, but then i listened to exactly what he was talking about and i know exactly what he's saying because it has failed in certain areas. and his point was we've seen a lot of progress, a lot of african-americans that have moved into preeminent positions. we had a black president, we re-elected a black president but he points out that the poor kids in black urban areas are still not able to really participate to the extent -- >> i understand what he says and i feel what he says, but i think

that what that is to me for these poor young people, sobriety, so smart, have so much hope what we have to do is create ladders of opportunity what we've got to do is show a vote of confidence they should not be going to second rate schools, not at all. they should not be in communities that don't have wholesome arts, culture, sports programming like middle class and upper class americans do the reality for kids in urban america is very different, but the talent is the same the promise is the same, and the need for the nation -- this is what's important, these are tomorrow's workers, they're tomorrow's investors and we've got to invest in them. that's why our main street marshall plan calls for a massive, a massive investment in america's urban communities, particularly in our youth. >> well, we're on a -- we serve on a board of first generation

investors, financial literacy, and asset ownership and learning early to do things in terms of starting to save, learning what a stock is, learning, you know, about mutual funds and i just want to get a quick -- >> yeah. what's so powerful about that, joe, is that these young people, college-aged young people created this themselves. and they created it in a way to bring investing skills, financial literacy skills to kids in high schools and in colleges all across the nation so it demonstrates just another example of how much talent there is, how much initiative there is we have to support something like that, which is a good -- it's a seedling. it's something that needs to be expanded it's an example and there are many examples out there like that i think we need to see this moment for what it is.

it's a moment of challenge, but i also think it's a moment of opportunity for us to understand what we have to do to make america the 21st century america we want it to be this nation will be 250 years old. what will we say four years from now as we look back on these times in terms of what we did to respond as a nation? that's the question on the table. we need boldness we need imagination. we need to deal with justice issues we need to deal with economic issues >> hey, walter to this point there has been some bipartisan support in terms of what congress has put out there in terms of the funding that's come, but i think the big question is what now now that some of the bipartisanship maybe has been fading away, now that there are different priorities that come out. marc mentioned this idea of state and local governments and the layoffs that could come there. i think that's a huge issue.

if we're looking at 15% unemployment now, we're hoping to get things back up and running but there are a lot of economists, most economists anticipate we're still looking at unemployment at 9% come the end of this year watching what happens with the state and local governments, that's where the bipartisanship breaks down because this has been a blue state/red state issue depending who gets affected here. what do you think? what would your call be when it comes to state and local governments and secondly the earned income tax credit that john mentioned and john hope bryant mentioned too. >> let's start with the state and local governments because they are the back bone in fighting both the coronavirus crisis and in some ways trying to keep stability and the sense of community i do think you have some bipartisan support for saying we just can't let our state and local governments go completely under in this quadruple storm of everything from economic to virus to police to wealth

inequalities happening and so people like senator bill casady from this state have been proposing ways, he's a republican, a conservative republican he's also a doctor so he understands when you have an unexpected health issue the budgets get a little bit out of whack. i think you could have a bipartisan sense that we have to keep state and local government afloat it doesn't mean that you have to subsidize them to do flabby things if that's what you think state and local governments are doing, but if you're in most cities right now, it's not looking like your government is sloughing off. we need that first longer term we need what both joe and mark have said in terms of a pathway to wealth building so that everybody can say, i've got an equity stake in this community. i've got an equity stake in my timeshare. what's happened for 20, 30

years, those that have had a pathway for wealth building and built some wealth have been able to ride out a whole bunch of storms but those who live paycheck by paycheck, those are the ones that have to go to open shops, work behind the docks in the port of new orleans in places where they can't use zoom to get in, they can't just live off of their savings to ride out a storm. so i think we have to have a more equitable system that leads people, especially african-americans, but people in the middle class, have a pathway to a secure ability to have wealth that will take them through the many storms we're going to go through in the next ten years. >> yeah. and i -- >> walter, marc, i want to thank you. >> go ahead. >> i was going to share i think you may want to look at the comparison of where we were in

2 2000 to where we are in 2020 for homeownership, people of color and others people's income and what i've been struck, how much ground we've, indeed, lost on those very simple measures and that is what people are saying when a large percentage of americans who rent homes in this country pay 50% of their income to keep a roof over their head, then the american dream is amiss. >> gentlemen, excellent points. >> amen. >> we really appreciate your time this morning and your thoughts on this >> always good to be with you, walter. >> marc, stay on i need to talk to you right away about all of this. joe, i'll send it over to you. >> coming up, dr. scott gottleib is going to join us and we're going to ask him if protests in major cities are going to lead to a spike in covid cases. before we head to break,

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now that's simple, easy, awesome. transfer your service in minutes, making moving with xfinity a breeze. visit xfinity.com/moving today. drug maker eli lilly has launched the first study of a new type of covid-19 treatment in this case meg tirrell joins us on the news line with the details. hi, meg.

>> reporter: good morning, joe this is the first drug to enter human clinical trials that is specifically designed to fight covid-19 it's whoes known as an antibody drug eli lilly along with its partner accelera and the national institutes of infectious diseases it isolated the blood sample of one of the patients to recover from covid-19. this is an antibody that targets the spike proteins that causes covid-19 they're going to be testing this they've already dosed the first patients in hospitalized patients with covid-19 they expect the results by the end of june. this is really a safety and toll ler rability study if that goes well, they will move into a larger phase 2 trial. this is also an approach where they think it could be potentially preventive so trying to protect vulnerable patients from getting infected with ovid-19 this is the first of a few different approaches like this

regeneron is also working on one expected to start human trials this month as well this is about a month ahead of when we expected lilly to get into human clinical trials it's moving very quickly lilly said it's starting to scale up manufacturing to have potentially several hundred thousand doses by the end of the year if these trials go well so a real milestone this morning. the first drug specifically designed to fight covid-19 entering human clinical trials, guys >> all right thank you, meg that is every day we're working. working hard, andrew hopefully something bears fruit. >> our fingers are crossed for everybody. meanwhile, following these violent protests around the country, could there be an up tick in covid-19 cases joining us to discuss the answers is dr. gottleib. serves on the board of i will

lumina and pfizer. >> good morning. >> we watched these protests taking place and the unrest all across the country some people were masked, some people weren't what's your state of concern at this moment? >> well, look, i think there's going to be a lot of challenges coming outof the events of the past week. one will be probably chains of transmission will have gotten lit. i don't think there's a question about that minnesota in particular was experiencing a large outbreak of its own. they didn't have full control of the epidemic it was expanding hospitalizations are going up. they're still going up that's going to be another challenge coming out of these events. >> you know, the mayor of atlanta suggested that anybody who was involved with any of the protests or out on the streets should go get tested this week what would you recommend across the country take place should everybody go get tested >> well, look, it's unclear what

the prevalence is in these different areas and who was in those crowds i think your risk has to do with what the prevalence is in the community you are in a lot of communities where the prevalence is low. cases are coming down, cases it's high. i don't know particularly about atlanta but certainly when you look in minnesota you see a higher prevalence in the nation. young people who probably weren't heeding a lot of the warnings anyway about social distancing this is one of the events and i think you will see chains of transmission that will go on from these gatherings that exist. >> let me ask you about that because we've talked about being outdoors so often and also about warmer weather, whether that has any impact on this is there any chance that we dodge this in some way >> well, the question is dodge

what i'm not going to sit here and imply that we're going to have major epidemics growing out of the protests i think we're going to have cases that get started these aren't normal, typical social interactions. these are a lot of people grouped together in crowds where they're not taking good precautions. a lot of people were wearing masks, they were taking them off if you watch the photos. it's a higher risk environment this isn't a day at the beach or going out to a picnic. there's some social distancing and you're able to take precautions. in these kinds of gatherings, these kinds of crowds many of which lost control of the crowds you're not going to be able to take those precautions there are risks. there's no doubt >> doctor, one of the points that marc and walter made in the last segment is that this is going to disproportionately impact those that are lower income, may have a lower capacity or ability to get

health care. i'm just trying to think through some of the permutations especially this week in terms of trying to get people help in advance to the extent they can also, lots of these young people may be living with people who are older. >> look, when you look at covid generally, it's very heavily disproportionately impacted people from lower economic groups and black americans and hispanic americans if you look at the data, about one in five counties based on u.s. census data are disproportionately black it accounts for 35% of the u.s. population they account for 50% of the covid illness and 58% of covid deaths this disease has disproportionately affected those communities for a host of reasons. the fact that the protests took part in large measure in the same communities i think is going to exacerbate the strains on these communities you saw businesses destroyed, stores shut. that's going to exacerbate

strains of communities already hard hit by the virus itself >> okay. dr. scott gottleib, it is always a privilege to spend time with you. we thank you again for your insights as we do every single morning. we hope to see you again tomorrow thanks >> thanks. >> becky thanks, andrew when we come back, bob johnson, the founder of rlj companies and bet is our guest that's after this break. we'll ask him if america's recovery is at risk. futures this morning, believe it or not, are actually indicated higher dow futures indicated up 70 points s&p up by 3 points nasdaq down by 7 this comes after two weeks where all three of the major averages ended higher "squawk box" will be back after a icbrk. quk ea

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a number of high profile ceos speaking out on issues of inequality and civil unrest. apple ceo tim cook sending a memo to employees in which he addressed the killing of george floyd in nationwide protests he wrote in part, i have heard from so many of you that you feel afraid, afraid in your communities, afraid in your daily lives and most cruelly of all afraid in your own skin. we can have no society worth celebrating unless we can guarantee freedom from fear against every person who gives this country their love, labor and life among other actions cook says apple is making donations to a number of groups, including the equal justice initiative in a facebook post the social media giant ceo mark zuckerberg

pledged $10 million to groups fighting racial inequality the pain of the last week reminds us how far our country has to go to give every person the freedom to live with peace, and with dignity and peace it reminds us yet again that violence that black people in america live with today is part of the long history of racism and injustice. we all have the responsibility to create change and blackrock ceo larry fink sending an email to employees and posting a message on linked-in it reads in part, these events are symptoms of a deep and long standing problem in our society and it must be addressed on both a personal and systemic level.

>> at this point >> the founder of a lot of different things this morning your thoughts or that. just before i got on the zoom feed i happened to go back in and look at a clip on the kerner commission report which was released in 1968 after the horrible riots dropped in detroit, particularly washington, dc and many other cities much like what we had today and

far more violent the kerner commission concluded after studying it that the words that became famous for it is that we are moving towards two societies, black and white, separate and unequal and i think that's what is before us today because of the killing of george floyd, but more than that as far as the pent up anger, frustration, bitterness expressed by many african-americans out on the street protesting. and, therefore, i have decided that it's time for this country to face up to the critical question that has plagued this nation since its founding and that is the need for full and complete reparations to

african-american descendents of slaves who are still today living in a chasm of wealth and income inequality which in my opinion, and it was echoed in the kerner commission report, they called it poverty, that is driving this nation back towards two societies separate and unequal. and unless we engage and focus on that issue, i think this country as we saw with the kerner commission report and the riots in '68, now it's 2020, we will see this happen time and time again so my request to the ceos, and i'm sure they will understand this, now is the time to go big. short answers to long, horrific

questions about the slavery are not going to solve the inequality problem we need to focus on wealth creation and wealth generation and to do that we must bring the descendents of slaves into equality with this nation and that's what i propose in this $14 trillion proposal to provide reparations, not only for the sin or the atonement of the sin or slavery of jim crow but to cause america to live up to the concept and the notion that this nation was born on the idea of american exceptionalism and if

we take that big leap, i am convinced that the problems that we confront today can be solved but it takes a big, bold action and $14 trillion in reparation for damages visited upon the heirs of slaves is an appropriate statement. >> bob, how would -- and this is -- we've spoken many times. i don't think you've ever embraced such a radical idea, and this is new for you. i've seen it put forward before and not taken all the way to mainstream thinking. i think that your embracing it is probably going to get a lot of people talking about this where would the 14 trillion come from lately we've been thinking we can do 3 trillion here, 3 trillion there

this would be through some type of wealth transfer from the haves to -- people that have the money, the wealthy individuals where would that 14 trillion come from? >> let me just say, on the contrary, i put out this statement on my website since 2019 about the need for this reparation, so i'm not new to this challenge, but to the points you're making, is that wealth transfer is exactly what's needed. think about this for 200 plus years or so of slavery, labor taken with no compensation is a wealth transfer denial of access to education, which is the primary driver to accumulation of income and wealth, is a wealth transfer the housing program that we all

in america believe in, that your house is -- your home is your castle and, therefore, the government has historically subsidized mortgage lending by allowing you to deduct it from your taxes, but think of this, african-americans with no accumulation of wealth cannot afford to meet the downpayments of homeownership and, therefore, they live in apartments and where there is no deductibility for the interest they pay on the lease -- for the income they pay on their lease that's why today african-americans, about 40% of homeownership. white americans are 70 plus% of homeownership. when you put all of these factors together, lack of access to education, lack of access to homeownership to primary social wealth for most middle income americans and discrimination, you have had for the past 200

years in effect a wealth transfer from white americans away from african-americans. so when i hear of things that the ceo tim is saying and larry and all of the other ceos, i'm saying in our business we often think of what is the big, bold idea we want to take on? this past weekend elon musk just launched a private business capital into space to link up with the space station big, bold ideas like that should become the order of the day. so to my fellow ceos, gentlemen, ladies, it's time we go big. and we have the institutional knowledge, the financial experience to craft a way to get

this money in the form of cash, i'm not talking about programs, more infrastructure building in the minority community, more school programs, more bureauc t bureaucratic programs that don't deliver, don't perform, i'm talking about cash we are a society based on wealth that's the fundamental foundation of capitalism allow african-americans to receive the wealth owed to them for past damages and damages is a normal factor in a capitalist society for when you have been deprived of certain rights, property rights, work rights, black rights, whatever it is so this is not a big leap. the final thing, let me say this, if you think about it, african-americans have the highest propensity to consume, which means we spend a major

portion of our wealth, one of the reasons why we have less savings, but the point i'm trying to make, if this money goes into the pockets like the stimulus checks or like other programs that are direct payment to consumers, that money is going to return back to the economy. yes, there will be more black businesses, i'm sure, because they will invest, but the bulk of the businesses and services and consumer activities are owned by white americans this money will return to the economy very fast. so this is not a complex idea if you really think about it, it's really, as i said, it's a little bit of atonement but more importantly it is due damages that are owed. >> i want to understand how this would work and how you think it would change the longer term

dynamic about both social justice in this country, about where the african-american community stands both within the economy and within the business community. you know, i appreciate the idea of giving out cash i wonder whether there's cash plus plus because i think you're going to -- i think if you're trying to create long-term change you're going to want to -- you might want to create more infrastructure or more big plans that may have, you know, long-term implications i don't know if you think something like this would. >> let me tell you what the real -- what i call philosophical and social change that would take place. once white america embraces the notion that to rid this country of its original sin, which is slavery, and to signal to african-americans, many of those same individuals who are out on the streets throughout this nation today, that we respect

the fact that we owe you compensation, we owe you something that would denied to your ancestors for over 200 plus years and we're going to compensate you for that. now to the question how would it be paid for? it's like how we pay for everything else in this nation, it's going to be a tax on the individual but it's a tax based on giving a people who have been deprived the opportunity to be equal to your opportunity and you can -- i can assure you, they will perform in their commitment to the country as they've done, they will do it in terms of commitment to race, to their children to be successful and to get the best education possible. they will then and of themselves impact their communities

new businesses, small businesses will open up minority businesses tend to hire more minority businesses than other people you will see more employment among african-americans. you see more stabilization in the community because they have capital to expend and capital to inve invest so when people say this is a complex problem, how do you get it to african-americans? we get information to african-americans. we ask them to fill out a census form we have african-americans, develop affirmative action programs and the like. i'm saying this is the affirmative action program of all times. >> that's true >> that it takes away from other people deciding what african-americans really want to do to rebuild, restore, and grow

their economic wealth by themselves rather than having 17 agencies do it. >> we were having the conversation earlier about the lack of ownership and that's the most important thing that's missing and we're talking half measures of financial literacy you kind of just refer to it as all of these bureaucratic programs that never get into it. just would take forever. this would do it in one fell swoop. we appreciate it we're out of time. i want to have you back. i'm sorry i didn't know you said this in 2019 but this is radical. >> thanks for the time putting money in the hands of the consumer, which we're doing right now today, is not radical. it is what americans do to grow our economy.

>> thanks. we've got a lot more on "squawk box" including ken frazier, the ceo much marc and moore. back in a moment

in the next year joining us now survey monkey ceo zander rory and back with us

john hope bryant founder of operation hope. good to see you again, john. xander, welcome. >> thank you. >> can you fill in -- just give us more color on this entire finding from the survey please, xander, and then we'll have john respond as well. >> sure, joe thanks for having me back. we have interviewed over a million americans since the coronavirus outbreak started thinking back three months including 100,000 black americans and the findings have been quite interesting we know in unstable times this is critical. this crisis has moved from not only a health crisis where 60% of americans said the health crisis was the biggest factor. now it's 5050 to the health crisis and economic crisis what's most stark as it relates to the tragic events of the last week is just how big the disparate is between how black americans are viewing this crisis over 70% have hurt feelings about economic wellness.

30% more than white americans feeling not only that the health crisis is it more likely to affect their community, their family but the economic crisis will have a toll over 70% feel that discrimination is the biggest problem in america more than partisanship you're seeing a huge disparity >> john, i would never -- you know my daughter, she has told me, just don't even pretend you can talk to any of these issues so you can't so i'm not going to pretend that i really can know what it's like, but i think everyone, john, realized without video how many of these things are happening that we only see when it's on video i think that that occurred to everyone, these recent situations where if it wasn't on tape, it's like we'd never know about it how many times do we not know

about it, john that's why all the fury and the anger and the -- you know, i'm not supposed to talk about it. that's what struck me. do you think that occurred to anyone else, that this is happening all the time >> i think it was will smith that recently said that racism is not new, it's just being filmed i think by the way it's fantastic that you and your daughter can have that conversation that says something good about the health of your heart and the health of her spirit, that you can disagree without being disagreeable and that you both can grow through that conversation you don't grow without legitimate suffering i think what's going on now is that growth. i saw in xander's data that actually whites are also beginning to acknowledge that racism is an issue, and maybe it's because, joe, you're seeing the undeniable truths of these videos that are unmistakable and unexplainable. that gives me hope that gives me hope even from our

last segment this morning to see that it was not just african-americans that are seeing this, it's others now you can combine xander's good data with operation hope's data that will show where george floyd was murdered, the average credit score i'm looking at is 570. the average credit for whites is 728 in the same state. the average income of wealth for black businesses, 79,000 the average wealth for white business is 590,000. these are huge gaps that go back to your last guest, bob johnson's comment. he talked about a topic uncomfortable for many, reparation let me reframe it. i put this in my new book. i tried to frame it in a way that isn't offensive if you look at slavery, if you work hard, play by the rules, you get the benefit of the labor. if somebody else was working hard and you got the benefit of

their labor, i think everybody sees that as fundamentally wrong. look at it that way. you've got these folks working hard, very industrious for 300 years, somebody else's house got bigger somebody else got the tractor, somebody else got the mansion. somebody else got the wealth creation that is the gap. you couldn't get education you couldn't uplift yourself you wanted to. until really after dr. king's death. and there is your gap. there is your snapshot now to see this data beginning to come together and using social media for something positive, like social justice, is a beautiful thing the question is to quote dr. king's last book, where do we go from here? >> well, so, xander, let me ask you this you know, there's obviously a huge debate in silicon valley around social media. here we are talking about the benefits social media has created by exposing these issues in ways that couldn't have

existed several years ago and yet you look at some of the polls and you see how polarized we are and a real debate over truth and what we're hearing and disinformation and everything else how do you weigh those equities or inequities if you will? >> i think the social media i k inequity you're referring to is starkening the other political events we're discussing. we're seeing democrats that keep people safe and welcome. we're seeing a majority of republicans safe so you're seeing companies navigating the different policies here. i think the truth is anybody waiting around for the federal government or republicans and democrats in congress to solve these issues is going to be waiting for a long time. companies have to step up and navigate this tricky landscape and how we serve our employers, how we serve our customers we're launching a new return to work template. organizational leaders of any size in nonprofit, education,

businesses for helping people get back to work there are some critical issues around testing, temperature taking, how we get into elevators, use cafeterias and public bathrooms people want to feel safe and companies want to serve their customers better we know the best thing you can do in unstable times is ask questions and use the data social media, to my friend john's point, discrimination against blacks has been happening in this country for over 400 years it's now more readily apparent and horrific so we've got a lot to discuss in terms of policies and we know that the diversity equality, the inclusion practices that silicon valley and others have is the path forward >> xander, john, thank you andrew >> okay. thank you both coming up, a lot more this morning on this crisis in america. merck ceo ken frazier is going to join us for a new interview

co-ceo melody hodgson. mohamed el erian on the market impact and a preview of this mek's big jobs report souch coming up on a big hour of "squawk box" coming up.

good morning crisis in america. protes protests demonstrators are angry over the death of george floyd take to the streets. tackling the systemic issues on the unrest. racism and a global pandemic that could make the economic divide even worse. we've got four interviews for you on how america can begin to address these problems and build

an economy that works for everyone merck ceo ken frazier, robin hood ceo wes moore and melody hodgson from ariel and mohamed el erian, the final hour of "squawk box" begins right now. good morning and welcome to "squawk box" here on cnbc. i'm joe kernen along with becky quick and andrew ross sorkin u.s. equity futures are now up a little bit they're up about 53 points on the morning session. the nasdaq is lower, down about 14 and the s&p is indicated up a little bit less than a point that's the first day of june so

we'll see how the summer plays out. a lot of times in the past you'd see maybe a little bit less activity i have no idea what this summer brings i don't know if anyone does at this point, andrew it's 2020. it's going to be the year that i guess hopefully some day we look back on it and say, wow, that was something to behold. >> we can only hope. right now some healing is in order. want to talk to one of the most important ceos in america right now about this issue we've been seeing over the past couple of days the ceo of the biggest companies you know in america have spoken out on the tragic death of george floyd and the protests over the weekend names like apple, facebook, many others we want to welcome one of the most important voices on that conversation on corporate leaders looking for solutions up to this. ken frazier is joining us,

chairman and ceo of merck. ken, we're privileged to have you this morning you have been outspoken on a lot of these issues over the past few years. we have not seen something like this for quite some time as a leader, as a ceo, as a father wanted to get your thoughts to begin on what you're seeing and what you're telling both your employees and your family >> so, first of all, andrew, thanks for having me on this morning. i was on this network less than a week ago talking about what our company is doing to help with the crisis created by the pandemic in terms of vaccine research and antiviral research and here we are a few days later facing another crisis of a quite different dimension inside of our company. the first crisis i think we can say caught us by surprise with the virus that emanated from china. this crisis has been brewing for hundreds of years and we're going to have to really step up

to it. so to answer your question, i would say first of all, there's a huge amount of pent up anger among many people in the african-american community as a result of the george floyd death. i'd like to try to just explain maybe to some viewers what the source of some of that anger is. i'll start by saying, when you look at that videotape, and we've all seen it over and over again, what that videotape shows is a police officer, a 19 year veteran of the police force in minneapolis, along with three other of his colleagues with a person who's handcuffed and on the ground being held down by three officers who has his knee on this person's neck. you can tell this man is not a threat at all. he has his hands in his pockets. you have a person saying, you know, i can't breathe.

i'm dying. eventually and complete fear he cries out for his mother he says, mama. there's a crowd around saying, take your knee off his neck. one officer's just holding the crowd back so what the african-american community sees in that videotape is that this african-american man, who could be me or any other african-american man is being treated as less than human. i think what really caused the spark that set all of this off is what is the reaction of the officials to what i just said? so you now have this videotape and for four days there's no action no one thinks that this is worthy of even putting the officer under arrest, which is the threshold step in our criminal justice system. it isn't an indictment, it isn't a criminal trial, it's not a conviction you can do all the investigation, you can do the autopsy, but what the community saw was until they went out into

the streets, this officer was much less the other officers was not going to be even arrested for what was clearly inhumane treatment of a citizen >> ken, you know, we're seeing a lot of ceos come out and put out statements, business roundtable over the week end and so many other ceos and corporate leaders doing the same what do you think companies should be doing at this point? is there something, frankly, to be done beyond the press release? >> i think there's a lot to be done beyond the press release. every time we have one of these situations, you can go back 30 years to the rodney king videotape, you can look at all of these other issues, eric garner situation in new york, two situations in minneapolis, a guy named orlando castille, his

fiance videotaped a video stream the incident where he was shot another guy jamar clark shot in the head freddy gray. these things happen over and over again when there's unrest, people put out statements they put out platitudes. they say this is terrible. we decry racism. i think business has to go beyond what is required here it has to go beyond just statements i think, for example, we know in this country that there's a huge gap between the number of jobs that existed before the pandemic, there was something like 12 million unfilled jobs in this country and there are 5 million inner city and other african-american kids who want access to the economy. they want to be participants they want to be citizens they warrant to be consumers what they lack is the education. they lack the training and there are opportunities for programs like this, a program called year up i'll use them as an example.

gerald chervagian runs that program. they put them through a six month intensive program and then they become interns for six months and they graduate and become productive citizens i think businesses have to use every instrument at their disposal to reduce these barriers that existed. i heard the prior conversation about the legacy of slavery. i heard the prior conversation about reparations. the fact of the matter is there are, in fact, barriers that are faced by african-americans even though we don't have laws that separate people on the basis of race anymore we still have customs. we still have believes we still have policies we have practices that lead to inequity i think we all know that in good times when the community is quiet, we can ignore it, we can go about doing what we believe is in our economic self-interest, but in the long run what's in our enlightened economic self-interest is that for all-americans to feel a

participant -- feel like they are participants in our economy. i'll just say, joblessness leads to hopelessness. the inner part of our country hopelessness leads to what we have in terms of the opioid epidemic business can step up and can provide the leadership that i think our country needs. >> ken, you know, we did talk to bob johnson in the last hour and he did make reference to a position in favor of reparations. what do you think of that idea >> i think the fundamental question is do we do more than we're required to do to actually give people full access to participating in our society what i said before i mean. i think business has the means to eliminate some of the barriers to full participation we have the ability to eliminate some of the inequities in our society. we can see those inequities and

disparities in education we can see them in employment. we can see them in housing we can see them in health care we can see them in the criminal justice system and i think fundamentally what business can do, whether you want to call it reparations or not, i think we can step up to address in today's world the continuing results of years and years of racial prejudice in this country. >> you know, i don't want to be autobiographical and i want to step across and make one point here. >> sure. >> i get to sit on cnbc and have this conversation with you because of one fundamental reason, and that was when i was growing up in the inner city of philadelphia, the social engineers in philadelphia at the time when dr. king was leading the protests in the 1960s, for reasons i don't yet understand, decided to take a few inner city black kids, put them on a bus, make them ride 90 minutes to different schools to get a rigorous education my class had 1400 kids in t. there were 9 african-american

kids i know for sure that what put my life on a different trajectory was that someone intervened to give me an opportunity, to close that opportunity gap and that opportunity gap is still there we're not asking people to give everybody handouts, but we need to acknowledge that there are huge opportunity gaps that are still existing in this country i apologize. >> no, no. do not apologize at all. becky's got a question for you, ken. >> what you're talking about with these apprenticeships, these internships, what does it look like at a company because there's an opportunity that changes everything. we've heard several people talk about things including john hope bryant what have you modeled at your own company? what would you like to see ear companies model. >> i gave one example, it's called year up what they do is take these talented, motivated inner city kids and for six months they

take them through a finishing school they have to show up on time every morning. they have to dress a certain way. they have to learn certain skill sets and after that six months they graduate and get placed into internships, entry-level jobs we're not putting people in charge of our laboratories but these are important jobs if they succeed in their six month internship they get hired. there are lots of programs like this you know, this program focuses on kids, younger adults. another issue in our society is the re-entry of people who serve time, who have been incarcerated we have lots of people like that and the fact of the matter is, if we don't try to create opportunities for these people to be employed, as i said before, joblessness creates hopelessness. >> ken, you're an example of one out of i don't know how many people that grew up when you

did. as you say, you were fortunate enough to have someone come in and actually intervene in your situation. listening to robert johnson, in one fell swoop i can see how we need -- we need to equalize the ownership of assets in this country and at the same time bob said a lot of bureaucratic half measures are just going to take too long i'm coming back to financial literacy and ways to do it organically and whether -- i mean, is that still -- that's still something we have to do? because i can't imagine that reparations is necessarily going to be politically palatable like next month be or this year maybe i'm wrong, but if we -- >> i agree, joe. >> go ahead, ken >> i agree with you. i agree with you i think the word reparations -- look, the reality of the world is trying to solve these problems through the political system is very tough we are such a polarized,

divided, fractious people right now. and, you know, the fact of the matter is we all live in our enclaves we all talk to each other. we go to the same country clubs. we go to the same churches and mosques and synagogues we listen to the same media and all of these things tend to harden us and harden our hearts. that's why i come back to the fact that leaders and the business community can be a unifying force they can be a source of opportunity. they can be a source of understanding. again, our society is more divided than it's ever been. we live in our own separate camps and enclaves you could actually argue that the workplace is the last place in america besides military, and maybe sports, where people can't choose who they associate with so we as business leaders can step up and solve many of these

economic problems for people to your point, financial literacy is critical education is critical. that is the great equalizer. we always say we're a land of opportunity and opportunity in a knowledge economy comes through education and training. >> the way to to it, i don't want to keep harping on it, this program, it's a 501c3 i'm involved with gives $500 to every high school student and then every week there is financial literacy courses they have to invest it it has to go into whatever they want to do, bonds, stocks, etfs. i can just -- it seems like baby steps though, again, ken listening to bob, i was like, you know what, we could do this for the next 50 years and we're still not going to go where you need to be. >> exactly. >> but that doesn't mean you shouldn't try to do what at least you can work with right now. you can start this the other thing i just -- i don't know whether -- >> i agree

>> yeah. >> okay. >> go ahead. i'm sorry. >> no, i do, too it's frustrating because it does seem like baby steps and we've been doing programs like this for a while and it's hard to make -- you know, we want progress more quickly. obviously we needed more progress than we've gotten so far. >> i agree but i think it's important for us not to be discouraged. >> go ahead, andrew. >> no, no. ken, i wanted to ask you as a business leader, you know, you're talking about the things that business can do and to some degree this is also a political issue. and requires the political will, frankly, to create real change the question i would ask you is what you think the role of a business leader should be in the context of the politics of this. you know, companies lobby for lots of different things on behalf of their companies and the question is whether this should be one of them and if so

how to do that in such a polarized world. >> well, i think, you know, business -- we have the business round table. we have other organizations. i think collectively business can point out, for example, that we have this 12 million unfilled jobs and we have all of these people over here who have no skills, why don't we as a society, including through government programs, focus on those people to train them and, again, today's conversation is just about what's happened in the last few days and we're reacting to that now we have to guard against is that when the streets quiet down, when the vandalism stops, when the protests stop, when the looting stops, a lot of people are going to go back to their normal lives and they're going to say, frankly, how do i maximize my self-interests when i hear a lot of people on

tv deploring these acts of destruction and vandalism and looting and they're right in that regard because there are a few cynical people in the protests who are saying let me do what's in my self-interest. let me grab what's mine. i think we have to ask ourselves, are they the only people in our society who simply say let me maximize my self-interest at the expense of others or at the expense of the common good. i think business needs to go to the seat of government, not only for its own economic self-interest in the short term but also to think about how to create a society that's going to actually be good for business. we can't have this toxic environment for much longer. >> ken frazier, i want to thank you this morning for your insight, your candor, your vulnerability and your sense of hope throughout all of this. thank you. >> thank you, andrew can i just close by saying, we are now facing two storms in this country.

>> please. >> the pandemic and the civil unrest those storms won't be here forever. they will pass and then the question is are we going to rebuild this country together or are we going to go our separate ways again as we have in the past the fact of the matter is, no one of us can rebuild this great country and the good news is none of us has to do it on our own. together we can actually make this the country that stands for the ideals that have always been behind it. so thank you very much for having me. >> hear, hear. hear, hear ken frazier, thank you very much, sir. appreciate it. becky. >> it's incredibly inspiring let's bring another voice into this important conversation that we've been having this morning wes moore is the ceo of robinhood. that's a nonprofit that addresses poverty in new york city he also is the author of several books including one that's called the other wes moore it's about a gentleman who grew up -- who was born just a few blocks away, a year apart from

wes. he was also named wes moore. grew up in very similar circumstances but obviously you see the wes moore we're talking to today the other wes moore wound up in prison wes has spent a lot of time thinking through how and why we end be up in these positions and what we need to do as a society to make sure that everyone has equal opportunity. wes, i want to thank you for being with us this morning. >> thank so much, becky. good seeing you. thank you. >> good to see you maybe you can pick up where ken left off just where we are right now. what we need to be doing how we make sure we don't forget about this when the streets quiet back down. >> well, i think we have to consistently remember why these protests are taking place in the first place. and, frankly, it's not just about what happened to mr. floyd. it's about the fact that mr. floyd and the taking of his life is are part of a much larger string of incidences of violence that is taking place against the black community and while

repeated requests and demands for action that are taking -- that have been made, there really has not been the level of sustainable or aggressive moment to be able to address it it's not just about this piece on policing. policing is one aspect in the way that we have seen systemic racism show itself within our society. it's also everything from when you're looking at housing assets, when you're looking at poverty rates, when you're looking at covid-19 and the fact that covid-19 has not just impacted the black community, it doubled the rate both in terms of transmission and also in terms of death rates it's this idea that people are looking for a sense of urgency and not pacification when you're watching these singular incidents that happened like the one with mr. floyd, when you're watching a 40-year-old man who is put under the knee of a police officer for over nine minutes, a man who at

first is screaming he can't breathe and then someone whose final words on this earth were him calling for his mother, a grown man calling for his mother who, by the way, she died two years ago. and seeing this on camera, it's important to understand that it's not just about this incident but about what that's doing, it's showing how short the memory is in our society and how these singular incidences can cause a massive level of destruction and unearthing if we're not being serious about dealing with the core issues that people are screaming about. >> so how do we deal with those core issues, wes >> i think we have to be able to be as deliberate with dealing with the solutions as we have -- as our large society is deliberate in dealing with the fact that we have so many systemic inequities. when we look at everything from employment rates, wealth rates, health disparities, et cetera,

we can't pretend like these things have been an accident many of these things that we're looking at, these have been historic, these have been laws that have been passed and we're watching the implications of it show itself every single day we can't understand the way we look at ghettoized societies, for example, without understanding the history of red lighting and without understa understanding discriminatory lending policies and how these various things line up into the level of economic and health disparities. if we're talking specifically about the elements of policing, we have to understand that there are heroic people who are in the uniform every single day who are not running away from a problem but everyday because of both their jobs and their moral responsibility are running to problems every single day. i remember i'm a combat veteran. i remember with the 82nd airborne division in afghanistan, i was deploying to areas that i didn't know

anything about i couldn't point to on a map a couple years earlier but i was being asked to go into communities and go into areas with my flak vest and my kevlar and my weapon in my hand and asking people to trust me. we have to understand that when we're talking about policing within the united states, it's not just simply about how do we get people better training, it's also about how are we strengthening laws of accountability how are we making sure that when these things happen and incidents happen, people are demanding justice, that is not going to continue falling on a level of deaf ears from the protection of laws that are in place to not necessarily support the communities but are more in place to support the officers? and so the way we're going to do this is to be able to have a really holistic conversation the law enforcement community, our actual community and to be able to pull people together to say we understand the problem. we understand nibbling around

the edges is not getting us to the solution we need we have to work this out so we don't have these con fl flagrations. >> what you're talking about is so deeply engrained and so complicated and so complex and i think people are reeling after this weekend and the events of the last several weeks, last several months and trying to find ways to come up with something that makes them feel better right now what you're talking about is much more complex and much more lasting. how do we take this moment, this motion and if there were let's say two things on a national level that you would like to see done, what would be the first things that we should really focus on to try and break away at this inherent racism and this inherent inequity that's been built up in the system >> you bring up such an important point, right i think that's what i think many

people are searching for right now. it's this idea of how do we return back to a sense of calm and stability and tranquility? i think part of the answer is i think we all must understand in our own hearts and in our own actions that there will never be peace nor calm nor tranquility without justice. we have to understand. we have to understand that i -- i am all for and i stand by the calls for peace but where's our collective pain supposed to go in the absence of justice? so i think on the individual level we have to be able to call this out and say the names of george floyd and brianna taylor, ahmed arbery, all of the other incidents that have taken place in a short period of time. these are the ones we know about and were filmed and captured acknowledge the fact that this is not exaggeration, this is not

hyperbole, this is not people starting stuff up. these are real, true things that the black community has been dealing with and continues to deal with every single day and how it manifests itself. we also have to understand that it is never just going to be about the policing aspect. the policing aspect has to be addressed, but we also have to understand the fact that we are talking about economic inequity and economic injustice and when we address that issue, when we address those collections of things in concert, then we know we're actually going to move towards a greater sense of not just stability but actually living up to the greatest ideals that this country proudly laments. i think what black america's asking for is for this country to love black america in the same way that black america's always historically loved this country, where we feel just as much a sense of ownership in its building, we feel just as much a sense of ownership in its

economic prowess, we feel just as much a sense of ownership in its building prowess we feel just as much a sense of ownership in the pride and what's being expressed and spilled out onto the streets is we just want to make sure everybody understands and everybody appreciates the fact that these levels of inequities just cannot continue if we are going to be a unified nation >> i think it was ken frazier who made the point today that these things can kind of get swept under the rug, particularly when there are good economic times, but what we're watching right now are some of the toughest economic times and watching the economic impact of coronavirus and the lockdowns around the nation, i just wonder what you've seen in the neighborhoods that robinhood serves right now what kind of economic pain you're seeing and what you're hearing from the people who are dealing with some of the worst of those economic pain >> i mean, the levels of impact

that coronavirus has had on our communities has been absolutely devastating. even prior to covid-19, even prior to covid-19 around -- over 40% of people could not afford a $400 emergency shock with cash well, that shock is here and it's a lot more than $400. even prior to covid-19 about 50% of new yorkers lived in poverty for at least a year over the past five years, right i mean over the past four years. half of new york city lived in poverty over the past four years and that was prior to covid-19 since covid-19 there's another stat that continues to keep me up at night. it's this reality that 22% of people that have lost their jobs in covid-19 were already living in poverty before. so, i.e.,, that's the working

poor those are people who are working, working full jobs and still living in poverty. and so i think what we have seen is that it's not that covid-19 has exposed something that wasn't there, it's actually really drawn the curtain and allowed people to understand what was there already and now completely exacerbated it. where we're seeing the impacts both the health impacts and economic impacts on the communities that we serve is not just double but the pathway back to being able to come to a true level of economic stability and a true level of upward economic momentum has been stunted and in many cases what the feeling is, it's not just been stunted for a short-term basis one of the biggest challenges we have, we're just not sure what the bottom is or what the bottom looks like as we're watching rising markets going alongside of rising unemployment, we understand

we've got a structural problem that for our communities we are on the back end receiving the major brunt. >> yeah. wes, i want tothank you for your time today. it's really good seeing you and we appreciate your thoughts. this is something we're going to stay with and we will get back to you very soon to talk about more of what you see for the need in those communities. >> i would love that thank you. >> joe thanks, becky. we're going to talk much more about the uneven economic realities underpinning the cross-country protests and what that unrest would mean for efforts to reopen businesses across the country ariel investment's president mellody hodgson joins us (vo) since our beginning, our business has been people.

and their financial well-being. it's evident in good times, with decisions focused on the long-term. and crucial when circumstances become difficult. that continued emphasis on people - our advisors, associates, clients and communities gives us purpose, strength and a way forward. today. and always.

welcome back to "squawk box. we've been talking all morning about this week end's mass protests and how they're at least in part a reflection of a deeply engrained economic equality in this country coronavirus pandemic has added another dimension hitting communities of color harder than

other groups joining us to talk about the path forward for individuals, the economy and just about everybody is mellody hodgson we're thrilled to have you this morning to help us try to make sense of what oftentimes seems to be so senseless you have been outspoken on this issue for quite some time especially within the business community. i want to talk about solutions if we could. before we begin, what's your personal visceral reaction to what you've seen over the paths few days >> it's so hard to put into words what you feel when you walk around with brown skin. you know your black first and foremost i always feel that wherever i go i have to say there's despair and sadness and certainly a level of anger and i'm horrified. i watched someone be murdered

over 8 1/2 minutes murdered not die, not killed, murdered. and to watch something like that is -- you neverforget. it's chilling. but we've seen it over and over and over again and that's the problem. we know all the names. freddy gray, trayvon martin, orlando castille, bring than taylor we can go on and on and on and we know those names. i know that sounds dramatic but it's actually true. >> so, mellody, you're on the boards of some of america's most important companies. you are a large investor what do you think business can and should do in we've heard from a lot of leaders this morning, a number of leaders who put out statements over the weekend. we just heard from ken frazier earlier. what do you think the business community should be doing? >> well, i've talked about this a lot. andrew, you know i did a speech

at deal book where i said i was waiting for a corporate kaepernick in reference to colin kaepernick and what he gave up for his beliefs peacefully protesting the death of black people in america unlawfully i have to say that corporate america, talk is cheap i've talked about the fact that, say, we're working on diversity in a company is unacceptable to me because in corporate america we don't work on anything else. we don't work on improving our earnings we don't work on meeting our product deadlines. you either do or do not as my husband boldly wrote about yoda. there is no try. and if you don't get it done, you get fired. but when it comes to diversity for whatever reason, this has been this ongoing struggle where it just -- we can't move the needle i love this saying, math has no opinion. none just count and when you count and you see at the highest levels of corporate america all the way

down the chain the differences in the numbers, that is not acceptable what must we do? hold ourselves accountable in corporate america. set targets like we set targets. incentive advise people. be very clear and bold about what the expectations are. if we do that like we do everything else, corporate america is run by all stars. they are used to winning if we do that like we do everything else, we would see this needle move because so much of this unrest, this civil unrest is tied to economic inequality. that's just a fact we need to move the needle on this economic inequality the one thing i love about ken frazier, who's a friend, and is just a stellar ceo, there's no question about it, but he

also -- he counts. we read annual reports for a living at ariel, and when you read the merck annual report, he lays out all of their diversity numbers, all of them in a way that i've not seen companies do. therefore, he's very transparent and therefore says, hold me accountable to these numbers each and every year that he puts out that annual report that's to be applauded and it's to be emulated >> let me ask you about that because then there's the investment community, with i is at least in the world of the markets, the community that effectively does hold management and companies to account and how much emphasis you really think the investment community places on this particular issue >> reporter: there's a lot of conversation about it and certainly with the rise of esg there's been more conversations about these issues than ever before when you think about the g part, the governance, but i think we still have a long way

to go. and we need to understand as an investment community what our power is we have a lot of power we can use our power to move this needle. first and foremost, let's start with boards of directors we vote those proxies. if boards are not diverse, we can hold those votes when jerry brown was leaving the board he put in a law. i know it might be struck down by court but he said he was unhappy with the fact that 25% of companies in california, 25% in california of all places of companies had all white male boards he felt that was unacceptable. he wanted to see those boards diversify. well, we as investors, we hold the keys to the kingdom with those proxy votes. we can say we will not vote for this slate for diversity there i celebrate goldman sachs. we said we're not bringing companies public if they don't have a diverse board that is bold that is putting your money where

your mouth is and ultimately saying i'm going to be about the solution and moving the needle on this issue. let's also look at the investment industry. i'm in the mutual fund business. look at the boards of directors of mutual funds. i've been saying this is another area, enormous power that is there in terms of america's retirement money when you look at the boards, i think the last data i saw of 28% of the boards have women on them 4 to 5% african-american i mean, these numbers are -- they tell the story of how far we have to go. and to the extent people on those boards started asking companies questions about leadership leadership becomes more diverse. that filters down through the organizations. i'm all for more interns but i like to start at the top >> mellodie, let me ask you a complicated question there's only so much the private sector can do, but clearly over time this is a private sector issue but also a public sector

issue and, therefore, a political issue. the request he is if you are a leader of a company, how engaged in this issue you want to become and can become politically given the polarization of this company and how you think leaders should approach it. >> i think we're in a situation now in corporate america where the role of the ceo and the role of the corporation has changed and while many might want to sit out these issues, they can't they literally can't we've now been pulled into so many issues as corporate america from mental health issues. you have to worry about live shooters two issues related to inequality, two issues related to obviously public health in ways that ceos never expected that they would have to live or work or think or prepare it is a new day. it also is a new day to the extent that government cannot stop that in some of these ways. i think there is some

disillusionment. when you look back to the 1960s you see the civil rights act and some of the major places where we saw true diversity and inclusion happen was in government because they have to uphold the law that's why it's no accident when you look at television and you see all of these black mayors which is a true testament to what happened and what is effective. to say that corporations now unfortunately have to take on more responsibility. we've seen that in everything from health care to a whole host of issues that, again, are front and center and have landed on the desk of the leader >> two other quick questions i don't know if you saw bob johnson was on last hour and he talked about reparations do you have a view on that >> i'm all for righting wrongs the question is how do you do it i also agree with ken frazier. i'm not sure there's a political

appetite for something like that in america, but i do believe in affirmative action, reparations. our country was built on free labor, free. that's great math. again, i go back to math has no opinion. if you could build a business and not pay for labor, you've got a great economic imbalance probably in your favor it doesn't work, however, long term at some point the chickens come home to roost. i don't know how we right those wrongs financially i'd like to right them in terms of opportunity, educational opportunity, job opportunities again, leadership opportunities in this country. there are 300 million americans plus there are a lot of people capable of doing great work inside of corporate america. they just need the chance to do it >> then lastly, you have a huge influence both in hollywood and in silicon valley. i'm curious how you think about social media in this age we were talking in the last hour about how actually in many ways

people would not have seen so much of the terrible things and terrible images that created these protests and created this outrage and may create a new hope actually for people in the end, but at the same time social media has been criticized for disinformation, for polarization and all of it. where do you think the balance comes out or should be what do you think that silicon valley leaders like mark zuckerberg and jack dorsey, what they should be publishing, what they shouldn't be publishing >> let me start out by saying i don't want to overstate any role i've had i've never had any formal role in silicon valley. i'll say this with some intention to my words. i don't know of any senior black person who really does i don't know anyone. and you name someone for me who does or hispanic what i would say is that i applaud jack dorsey's efforts. i think he's very courageous and very bold. it's also the right thing to do.

i felt great when he took the political ads down especially since he said i don't want to have things that just aren't true and i think the statements and what he's doing right now just to make sure you check all inappropriate behavior no matter who it comes from, that that is the right way for a businessto work, whatever the rules are, they should apply to everyone. that's what we as black people want that's why sports works. the free-throw line doesn't move if michael jordan's at the line versus someone else. that's what makes it fair and that's what makes it possible for us to be great so when you look at what jack dorsey has done there, i think he's really made the statement that we're going to do what we say we're going to do. i would hope that that leadership is followed by others i really expect that of them i think these are well intentioned people who want to do the right thing and unfortunately doing the right thing often puts you in a very

uncomfortable situation, but that's why he gets paid the big bucks. >> mellody hodgson, it's a privilege to have you on the broadcast. thank you so very much. >> thank you. coming up, i think we're going to speak to mohamed. what to watch ahead of the opening bell on wall street. we will speak to allianz chief economic advisor mohamed el erian. it's the first day of june and major indexes are coming off their second straight positive month. futures right now are in the red again. dow's down about 18 points it was up as much as 50 or 60. down 100 at one point. up 100 at one point. stay tuned, you're watching "squawk box" on cnbc at leaf blowers. you should be mad your neighbor always wants to hang out. and you should be mad your smart fridge is unnecessarily complicated.

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breaking news from gilead this morning meg tirrell joins us with

details on the phase 3 trial of remdesivir in patients with moderate covid-19. meg? >> reporter: hi, joe of course we know that remdesivir is already clear of an emergency use basis in the united states based on studies . this is yet another trial that gilead was running, this in more moderate patients who are hospitalized with covid-19 previously they reported results of more severe patients. this is the drug that is thought to work better if given earlier in the disease they found with a five-day course of treatment, remdesivir reduced the risk of -- or people were 65% more likely to have clinical improvement after 11 days versus patients just receiving standard of care these results also looked at a f ten-day course of treatment and it trended towards significance,

this adds to that mixed picture on remdesivir. yes, it does appear to work and help with covid-19, but it's not that slam dunk curative treatment that people are looking for. back to you. >> thank you, meg. >> watching that stock down about 1% let's get to cnbc headquarters, jim cramer is getting ready to come to you in a few minutes. there's so much that happened over the weekend, it's hard to process it and put it together, it's hard to figure out where we go next. i will say listening to a lot of business leaders and others we've been speaking with today it gives me hope that there are ways we can all pitch in and make sure we take action >> extraordinary morning with so many thoughtful people i was conscious that we just learned so much. i think we -- in the history books perhaps or living through the '60s, but the people you have speaking can teach us all so many things to listen to ken frazier and

talk about how he grew up in philadelphia, not far from me, but in an entirely different life how much he learned, how much better he is for it, how smart you are kind of struck mellody hobson these people are still in the fight. many of us have just kind of, like dr. king said, maybe we were along for the ride or sleep walking. it's a great wakeup. we better heed it. i think that's -- this is a giant wake-up call i want to thank you guys for doing real coverage that explains what we can do as opposed to just being onlookers. i agree with you we all have to rethink what can we do? joe talking about helping younger people and andrew asking some questions that make me feel like perhaps i've got to do more myself i don't know i have a lot of soul searching to do. you're trying to get ready for your show, thinking about stocks that's what they come to us for.

you have to be bigger than we are. it's just imperative wow. great. >> one of the lessons i took away this morning was from john bryant who joined us at 6:00 a.m. talking about how when martin luther king came back from atlanta after winning a massive award, no one wanted to celebrate him for that but it was the ceo of coca-cola who said if we don't stand up and do this, we're nothing we're a global community, a global company, we need to make sure we're addressing and recognizing and respecting this. it was a turning point taken by the ceo of coca-cola at that point that made that community come together. looking to businesses for leadership in times like this, it's one of the things i'm taking out of this >> i think it's great. i agree. when i read tim cook's comments this morning, completely in sync

with how we all feel i think we're all kind of lost we want safety we -- dr. king stood for peaceful confrontation but i go back to indianapolis, i saw what happened there. i remember the great bobby kennedy speech about dreams. i just think, geez, i wish we had more people talking about that >> yeah. jim, thank you we'll look for you in a few minutes. thank you for your time and your thoughts joe? >> thanks. joining us now to talk more about the entire three hours i'm sure, because he always watches, he's always got some smart and i sightful thingsto say about no just investing but everything else, mohamed el-erian joins us. allianz's chief economic adviser. it's not going to be one of your typical appearances, i don't think today. what are your thoughts on just

watching what we've seen over the past week or so. >> i would join jim right now saying we have to be bigger than what we are or mellody's powerful statement the killing of george floyd is horrif horrific it's indicative of long standing problems of discrimination and injusti injustice. the peaceful prol tetests highl the anger in many parts of society. this is an issue being made worse by the covid shock mike spence and i characterize the shock as the unequal opportunity unemployer so it unemploys people in an unequal manner it hits the least privilege lenled segmelenl segments of society particularly hard so this issue is not just social, which is very important, it's not just an issue of

justice. it's an issue of economics the other side of it, which is more regrettable, the violence and the looting, that will make the recovery even flatter and longer there's a lot of challenges. i think jim is right in saying every segment of society needs to step up at this point >> we are trying to also gauge what it means, what's happened to reopening the country to what it means about the pandemic, to what it means for small businesses that were already affected there's a lot of different -- there's a lot of linkage here to what was happening in the country. i wonder if it makes it more difficult. >> supply resumption is difficult enough now that stores have to worry about whether they'll be looted

or not should they open or expose the employees. the good news is there are policy tools they're not with the federal reserve. they're with congress and the administration it's about more focused relief efforts to get to the segments of the population that are suffering and in pain. it's about better safety nets, so that demand insecurity doesn't hinder this recovery it's also about addressing productivity up front. labor retooling, retraining, infrastructure there's lots we can do if we focus on what are the problems, what are the market failures, what are the institutional failures and let's get on with it and stop focusing on just boosting asset prices. focus on the real economy. on people rather than on markets. >> boosting asset prices doesn't help people who don't have assets correc correct. >> look, you and i -- >> how do you get people -- to

be totally honest, i never thought reparations would become a mainstream idea, but listening to robert johnson, we tried a lot of half measures a lot of baby steps. is there a way 13 trillion could be somehow -- i don't know the did you see that segment >> i did >> how would that -- what would that look like is it just not palatable at this point and we need to continue with the way we've been doing it up to this point which has not borne that much fruit. >> i would encourage you to talk to mark cuban about this, jamie petrikoff about this, they have ideas that companies would embrace of making capitalism more inclusive giving people not just employment stake but ownership stake. there are lots of proposals that people are thinking out of the box, i really encourage them

we can do this we have the tools to do this, we have to focus on it and we have to be bigger we all have to take this more seriously. i keep repeating, you can't be a good house if the neighborhood is challenged. we all have neighborhood responsibilitie responsibilities >> can we briefly talk about whether you think this effects the overall back drop for financial markets, it's june 1st. where do we go from here >> basically where we go from here depends on whether the fed and the ecb will continue to support markets and continue to decouple them from the economy you know how uncomfortable i am about this, both as an american and as an investor i don't like betting on morale hazard it comes down to the fed the way they went into high yield and the fact they now own

hertz, they own jcpenney illustrates that the market is confident about the fed put. >> thank you final discussion of the day. appreciate it. i don't know if we'll be on camera together, becky and andrew, i'll see you tomorrow. quite a show quite a day, quite a weekend join us tomorrow "squawk on the street" is next good monday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber live from separate locations markets and american business try to reckon with the wake-up wall that this weekend of national trauma has delivered. multiple crises in play, global health, racial inequality. futures are flat as is oil there's been commentary from