have a great weekend it's friday. >> you, too. thanks. >> andrew, rabbit, i don't know. how many people are coming you only had that one little guy. >> we will keep it tight and we will make margaritas. >> do you know what -- >> come on you are a sucker for a margarita. >> i have a new drink. poloma for -- anyway, try it look up, try it, grapefruit, splash of lime, a little seltzer. have a great weekend. >> becky, you can come in person, you can join by zoom. >> "squawk on the street" coming up right now good friday morning, welcome to "squawk on the street," i'm quintanilla with jam cramer, faber has the morning off. futures up 600, we will claw back some of the pressure from yesterday as the market again wrestles with economic reopening, technical levels, some down grades of cat, united and tesla. oil is above 36, ten-year back to 7/10, jim, but you were just

talking with andrew about what exactly got washed out yesterday. hard to say a lot when hertz is up 50% premarket. >> i mean, look, it is kind of a comedy of errors, no insult to the board. really there is a bankruptcy code and maybe hertz management got permission -- in the old days when you went bankrupt there would be a little bit of a stump of stock so that you could go and sell it and show the irs that you had taken the full loss carl icahn sold a ton of the stock in the 70s, he sold 38%. i think if he had known that there would suddenly be a new stock he would have hit that bid. if i were him i'd sue. i'd sue right now. i would just hire a lawyer and sue because he sold at what the company was advertising as a bankrupt price where the common stock was and he has i think a

right to be able to claim 38% of this money and i urge him to do so, to hire a lawyer and get the money because this is just ludicrous. >> we'll see what the court says i think they've got to get to 4, right, to get to a billion, but even so the four-year bond there trading at 35 cents. >> how do you like that? here you've got a company that knows that the common stock could be worthless, but is having some fun because there's so many stupid people who are bidding up the common stock when it may be worthless. i think that the government should have frohave frozen the n said we don't want you to lose money but the government does not care about whether you lose money or not, the government just says, hey, listen, you have every right to be a stupid idiot, just that carl icahn i think is not a stupid idiot and recognizes when there should be money that was his because he owned common stock, but, look,

hertz is hilarious and i have to hand it to them. this was one of the funniest things they've done and of course the joke is on the people who buy it youknow what, again, there's nothing in the constitution that says you can't make people look like idiots. i studied the constitution >> is it a worthy lens for looking at market sentiment from 30,000 feet? is it indicative of anything larger >> i think it is. >> barclay's has a big piece out this morning about robin hood, in their view there is no correlation between aggregate robin hood holdings and index levels maybe on individual stock levels, but they argue that robin hood is not behind the rally. >> i don't think so. i mean, look, just one -- e-trade reports its may daily average, it's monthly activity report -- we are talking about record highs volumes of all time in june. so, no, i think it's a collective action. i want to be in favor of it, carl i want to be able to make everybody happy, say buy some

hertz and then what will happen is when youtube three weeks from now they will say, do you know what, he was part of the problem. buy american airlines after they put out really bad news, why not? these are -- if people wante these stocks there would be plenty of supply if they would just wait until 9:30, b3 930, bw are fomenting action of course, there isn't there's not -- carnival is not about to merge with royal caribbean that i know of and you can't really have any more consolidation in the airlines, but it doesn't matter. look, i could stand on my head until i'm blue and say, listen, please don't do this wait until 930, the stocks won't be up, don't bid them up and it's not robin hood, it's whoever is bidding them up now, you will be able to get them lower. if your job and goe is to foment activity, you're fomenting it

left and right that's what this is, it's fomenting. >> you mentioned the airlines, jim. american a talking zero cash burn, positive net booking since mid-may. tsa traffic yesterday 502,000 passengers, we are going to talk to elaine becker later on this morning. a couple months ago she didn't see us getting to these levels for three to five ears. >> look, there are people traveling but remember i think that there's lurking here if i were -- other than southwest, i would be doing equity deals. these are not hertz, these companies actually they've got an operating business and common stock represents the earnings stream, but if i were american and the stock pops i would sell stock. i mean, if people are going to buy stock at these inflated prices american should be in there selling stock on this news if they borrow money from the government they have to pay it off. why not take advantage of this -- you know, great

exuberance and sell stock. i don't know why they don't. hertz did. it would be smart. >> right yes, they did. i think cowan says so far airlines have sourced $83 billion year to date, that includes government aid, and then we've got, you know, second day in a row, jim, of down grades for companies like united, today it's credit sui e suisse they up southwest calling it their favorite multi-year strategic investment. >> that i like i mean, gary kelly has been incredibly responsible, the ceo the whole way, he has raised money, raised money at a price where they were up 7 bucks, got a good balance sheet doesn't ever let us down he is the stalwart if you wanted to buy southwest at 940 after the fomentation you could do it if you like. i looked at what happened yesterday and saw incredibly high quality stocks be thrown out in the last half hour that i think represent better buys than

these airlines that's not what this market wants. they are confusing eli lilly with jetblue these are very different entities >> brings to mind sort of the picture about the reopening, jim, and the spike in cases, a lot of debate this morning about whether it's overflow from mexico, it's certainly not parabolic which the bulls want to argue you don't have to worry about it being a function of the protests, it's more a general ee opening dynamic. kudlow is saying we are not seeing a second spike. do we believe him? >> i look at the johns hopkins numbers every morning and it's actually pretty encouraging and the hopkins numbers are not political. so is larry right on this? i just say go look at the hopkins numbers and make your own judgment there is a bit of a bump up in texas, there is no doubt about that, but most of the curves on the hopkins page and state by state look pretty good again, there is a lot of people who i think are hearing news

items which say it's much worse but the hopkins numbers don't lie. hopkins has been -- it's not a company, the school that's been the most right the whole time and their numbers are unavailable and the numbers are pretty good. >> indeed. yeah and then you've got the president this morning retweeting scott gottlieb who said that the regeneron cocktail trial is in his words a critical milestone because, that, jim, is something that you could make available through emergency use authorization by the fall. that's sort of the game changer that the bulls are counting on. >> i don't want to put a gun to len shriver's head the question of regeneron but it could be before the fall. i think he's got the cocktail. they did ebola incredible interview yesterday with meg tirrell all you need a is gottlieb and tirrell, you don't need anybody else but it was very, very

encouraging. i felt good after i listened to len. len was my first guest on "mad money," the stock was at 5 bucks, it's at 609 it was never bid up before the market by anybody and i think that regeneron's news is so encouraging and they have so much credibility that i, too, share the president's enthusiasm this could be the game changer not remdesivir remdesivir could be part of a cocktail now, len has been saying -- len schreiber has been saying it's going to be a cocktail, but i have the most face in regeneron of any company that's involved other than johnson & johnson and so i think i would look to regeneron as the way to be able to get out of this morass and maybe get us restarted don't want to put too much pressure on len who is i think a terrific guy >> it's interesting. probably one reason why two people, jim, this morning on squawk were net positive, sandy while on banks which we will

hear in a moment but david rubenstein of carlisle inhis view said the bottom of economic activity has been hit. here is what he said >> i think the bottom has been hit. i don't think it's going to get steeper in terms of a recession than what we have now. i think we're coming out of it i think people can overreact and i think there has been some overreaction in the markets from time to time clearly the economy is body low, we haven't had anything like this for generations but i do think we are on our way back >> yeah. >> jim said he still sees congress likely to do one more bill. >> i think they need that. >> a trillion to a trillion and a half. >> we need to have a tide over because there are a lot of restaurants, a lot of retailers that won't get to the promised land this is like the jordan river portion of the wandering in the desert but i would say that we could have the fabled double-digit increase in the next quarter if regeneron comes through. now, look, you could say, well, jim, you're just being completely too bullish

i have followed regeneron the whole way, they were very honest with me at the very beginning, they said they had nothing, they had nothing, they had nothing and then one day len said we may have something and then he said we may have something and then he says i think we have something and then they start these trials and this is not a company that had a fly by night company of which some of them affiliated here candidly, this is a company that has so much credibility that if they think they have something, i mean, i called my doctor, i wanted to get into the regeneron test my doctor is conservative sand said, listen, you don't want to do that and they are not accepting your age group and you don't want to do it, but i think this is going to be the real deal there's no reason to not trust len, he's got way too much credibility. it's a real good company. >> you would contrast that with, say, modern in a which is on the cover of the "boston herald" with the headline help is on the way, it's about the trials that

will happen there next month. >> i read stat, i just feel stat has been -- stat did that incredible piece about the liquidation by the chief medical -- one of the highest execs of moderna and how he sold stock. moderna did the eight for eight and then next thing you know you've got a big stock sale. i had been a huge backer of moderna because i liked the fact they work with the amazon web services, they are very smart people, but it's never been -- they've never been able to get anything through, never been successful in this and the stock sales did not need to occur. okay it didn't need to occur and it tainted the situation. >> i think a lot of people feel that way, jim. after the break we're going to talk about something else david rubenstein talked about, that's election risk to the market. and we will get to some of the retail names, big stories at pvh and lulu and others.

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going into a pretty good tape this morning, pvh is down about 1.5%, jim. one of the few retailers really that has said q2 is going to be worse than q1 was. >> wow manny tirico i've known many times and has come on for years

and years was -- i think he was quite negative and talked about how there are many retailers that are really going to struggle here. he said this year was a mess he said he used the term bs. he said no bs, this is a very tough time for retail. there are only a few retailers who i think will come through this thing unscathed one of them has a stock that's down that i think actually should be up which is lululemon. i like that quarter very much and i think there's a lot to recommend. pvh does not have necessarily the brand, that's calvin klein and tommy hilfiger that can sustain. lululemon has been a fantastic work at home play at home company and i thought the numbers were good, it wouldn't surprise me if that stock is i believe to have a run. when we talk about what's running before market, i say, well, let's deal with the facts. adobe was better than expected, people thought that down was really bad last night, that was a mistake. i think that lulu is better than expected i think that american air is not

better than expected i think the genius brandswhich trades like a mexican jumping bean, you know, it's up, up, down, down, is the kind of thing that people are focused on because it's a $4 stock. i just got to tell you, carl, i don't mind people losing money but i'd rather them lose money in real stocks so they can buy more of them than buy stocks and then sell them because they're not up by 10:00. that's what i really fear. i have no desire to be a kill joy. i think you should buy a stock like lululemon when it's down because it likely will be up a few months from now because it's such a great brand and it did well i think that we are in an unfortunate period where there are a lot of people who would not buy when the dow was down 1700 and they waited for the futures to come out of their slump and now they come in and it would have been far better

had they been buying into the decline than coming in all excited this morning so, look, again, i apologize that i'm throwing a little rain on the parade, but do you know what, bring an umbrella, you will be fine and we are going to take a breakndomrit ck a ce gh

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take a look at futures here. we're going to try to work back some of what we lost on thursday coming off 5% drops for all the major indices and the first three-day loss for the s&p since march. we're back in just a moment.

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>> announcer: the opening bell is brought to you by nuveen. a leader in income, alternatives and responsible investing. time for a mad dash. i think jim is watching two down grades today of tesla. >> yeah, we've got a goldman taking tesla from a buy to a neutral. they like gm, neutral to buy then morgan says tesla goes to underweight they're 680 goes to 650 target, they fear china and tech composition, 132% move versus s&p minus 7 the goldman piece resonates with me look, i don't think tesla is a sale, i like tesla very much, but what i like is because we're not going to have -- we need social distancing, because we can't carpool, because people are afraid of mass transit, i think autos are going to make a come back and that's why i like

this goldman call very much on gm i also like autozone, i think that if you were to make a bet even on ford you can make money. i say bet on ford because ford doesn't have the balance sheet that i like, but gm has very good china business. i think you don't need to sell tesla to buy go. m, that's kind of i think brokera brokerage artifice >> jim, that's interesting jpmorgan last night was talking about this pent up demand issue, more in terms of services, but their larger point is it's going to be impossible to know what normal levels of demand are going into the next few months because there will be explosive spikes in demand for things that people couldn't get or wouldn't go out to get and so we're going to be left asking a lot of questions. >> yes by the way, hertz day of the giant offering have 700,000 cars that i thought could come to

market, the used car market should be hurt by that, used cars are selling well. if we take gm at face value and say that the chinese market is back, that's a nice wind, that's a nice tailwind. some people are saying that tesla won't do well in china, i think that's crazy gm i think can work and not just for a trade, i think you can be for an investment because of the -- because of what's happened with covid. it does make sense to have your own car. >> we should take note of the incredible month that elon musk has had, sending men into space. tesla is now the most valuable automaker in the world jonas' point with morgan is china, competition, right. >> right. >> we talked to ford about vw partnership earlier in the week, capital needs, near-term demand. do those things add up to a small trim to the target >> i don't know. i mean, he is kind of like the jonas brothers, one day he comes in, he likes it, the next brother comes in he doesn't like

it i think the jonas brothers, i love them, i once bid on a concert at robin hood and not the men in tights that people are excited about here and they remind me of jonas they are kind of, you know, sometimes they're up, sometimes they're down i'm sure that jonas is a nice man but he is all over the map i don't know what to say about him other than tesla has been real right and he seems to enjoy commenting on it he should make a song about it. >> we've talked to him in the past about his -- the disparity between his bull and bear case numbers and so forth the other big downgrade this morning was bmo on cat, going to 130, talking about in their terms a catatonic near-term recovery. >> i thought that was a funny piece because when you read through it actually kind of felt positive they talked about management being better about cash, talked about some possible tail winds

coming down, but the stock is a trading vehicle and i know that caterpillar didn't come down enough versus the other cyclicals. it was a trading call, i believe. it was caterpillar is doing much better than expected but i know that the numbers, the actual monthly numbers were not that good, so this was a well-timed downgrade, but don't stay -- don't go short it because caterpillar is not the old caterpillar, it's better run. >> target 130 is not too far from here. >> right. >> jim, we mentioned sandy while on squawk earlier this morning talking about the banks, whether or not they are in good shape and he managed to bring a couple recommendations within the space. here is what he told becky and joe and andrew earlier this morning. >> the financial industry is in very good shape this time and i think that the stocks are selling a lot of them well below book value, some of them have

created different models and, for example, i think companies like morgan stanley and schwab are really very good buys for the long-term because they really represent the building up of assets, recurring income. i think they have made a lot of very smart moves and the stocks are really, really cheap relative to the potential. >> far be it for me -- >> he really didn't go -- >> i'm sorry. >> i was going to say, jim, he really didn't go too far in terms of becky's request about whether or not loss provisions will be another story in the coming prints. >> that's what i worry about goldman sachs is, what, about 7 bucks below its tangible book value and yields 2.5 but the fact is that these -- goldman sachs traded down to 130, that's not supposed to happen the reason why some of these are not great is because they can't buy back stock you have these gap downs it's hard for me to believe that

you get a guy like jamie dimon and the stock is down 6 bucks, he buys the stock, but you are not allowed to do that anymore when i look at the pe of jpmorgan at 11 times it does intrigue me buti worry about long losses, it's a recession, it's not great to buy banks in recession. i worry about one day the fed wakes up and says we do have to take the dividends away. i worry about companies that are still linked to what the company can say about them i am not as -- sandy is a great investor, a great man, great philanthropist, but these are stocks that you really got to buy when they're getting completely annihilated because they trade terribly on a down day. terribly >> yeah. that was one of the other take a ways from yesterday's action, jim, some who were looking for silver linings said that although, you know, there was a big gut check on equities the credit by comparison held in relatively well. would you go that far? >> yes, that's true.

and it does say that the market just -- the common stock market got overheated i think it got overheated for the oils, but here we go again, carl, chesapeake energy up 5 bucks. i mean, it's probably a worthless piece of paper 5 bucks. i mean, you know, it's -- it's just a game. >> as art cashin just said in his note, jim, the amateurs will be back today to ride the market having been partially protected by the sell stops they used. >> he is so right. remember they went to the roulette wheel every day and it came up black. yesterday it was red but they have genuine belief, listen, when you play roulette it comes up black. look at how many times it came up black they didn't take that statistic, it was a hard course, wrecked a lot of people's transcripts. >> awful lot of green at the nyc, celebrating azek company,

the ceo will join us on "squawk alley" this morning. the nasdaq celebrating an ipo, burning rock biotech, provider of cancer screening, jim, in china as the ipo market continues to get our attention. >> chinese ipo okay looks like nothing has changed door dash being valued at $15 billion, i mean, by guys who want to bid the thing up at a time when most restaurants are hobbled. door dash goes up in value at a time when matt maloney knows to cash out, he being the ceo of grubhub we get this valuation $15 billion. it does feel what happened with lyft and with uber, but when you've got these companies that are already invested,they like to buy more at a higher level, makes them feel terrific i don't know there's a lot of stuff i'm not crazy about right now, carl. even though i do like most of the companies and i understand why everything is green because we've become a roulette wheel and it came up -- it landed on

double zero today, but i do feel like it's become the gambler and i think it's a shame because there's so many good companies that should not be subject to this that should just be trading on the merits and not subject to the whims of big hedge funds who come on and say it's done, the world is over, or it's great, and by the day traders who are now blowing out of the stuff they bought at 7:00 and they're happy, maybe they're even done for the day. >> there's two names in the red, jim, one oak and campbell's. >> one oak it took an equity offering to get one oak down, walter holtz, ceo, he knew to offer $26 million. campbell's, i guess people are not staying at home because that's -- remember, when they reported they killed themselves. i mean, they had a really good quarter and then they said it can't continue that's very hard to argue when

the question comes on and says it can't continue. last night when manny tirico came on from vh. i said your stock is down a lot. it's going to be a very tough year there are ceos who are willing to say it's not coming together right now. >> every dow name in the green jim, boeing is up 8 despite des lines that say they're pulling back on the max restart out of the journal this morning, that they've told spirit aero systems to pause production of parts that they were starting to make in advance of a resumption in production so it's hard to keep that down people all want to believe we are all going to fly again. >> i think boeing on discount is going to be good because i do think they are going to get 737 approval i do think that flying will come back, i don't think it will come back nearly as fast as the initial people were flying and part of that is because a lot of things are closed and a lot of -- it's because of zoom or

web ex cisco which is doing great well boeing is a great company and has an order book and i do think they will make a come back but all in good time it's not going to be overnight i think there's going to be a second half 737 max but will the airlines have enough money to buy? i don't know does the federal government have to do another round of airline investment i think the answer is that they may have to. they may have to not for southwest but for the other guys. >> mnuchin with us yesterday and ked low i guess to some degree after did suggest they would take a harder look at travel and leisure in this next round. >> yeah, well i think that secretary mnuchin was talking about restaurants. when you have to take out -- when you take out 60% of the tables or 50% of the tables you can't double the price of your -- of your -- how much you charge people. so you're just going to -- you're not going to be able to

pay your rent so you are going to go under. the big chains won't have a problem, darden will be able to do it, jack in the box had good numbers. almost every other restaurant where between 13 and 15 million people work is going to be struggling which is why i question the door dash $15 billion valuation the restaurant business is the one that's most on the ropes because social distancing is difficult and there's also studies the cdc has put out about how air conditioning can move droplets through a restaurant so there are real issues unless you're outside doing social distancing and it's an industry that i know that needs the vaccine. let's put it that way. it needs a vaccine to come back, but when it gets a vaccine it's going to come back with a vengeance. people like to go out. >> yeah. no, your point exactly right, jim, because the distancing thing ruins the unit economics. >> yes. >> masks, we know, are the closest thing we have to a golden ticket, but compliance is virtually impossible to make

universal. >> i know. >> i see dave and busters up 12%. on the notion that we're going to start playing video games and pool in a gathered setting. >> i think that's great that company was trading at one point as if it was going to have to go bankrupt when it traded down at 4 on the 18th it's a lot of fun, it obviously requires -- requires crowds to do really, really well when you are at a bar, by the way, there is a company that sells devices which show exactly where you can sit at a bar and all i can tell you is that you need to be able to double the price of those drinks because there's just not enough people you can get at a bar one of the things that's fun about dave and busters, you go to the bar while the kids lose money on things like the claw, you know >> that's right. jim, microsoft, this morning the president retweets a tweet that argues they should be banned from federal contracts as they

now join the growing chorus of tech companies that are not going to play on facial recognition with regards to the police. >> i think that, look, these things are up to the execs look, what i -- i don't want to be able to do it, but whatever i think microsoft is a very ethical company, maybe one of the most ethical i have ever seen amazon did it. by the way, there was a nice note from facebook that chan/zuckerberg children any here he actually talks very critically of the president. so, i mean, i think that there was an article in the paper about how the president is getting isolated on certain issues and, look, i play with an open hand. what happened in minneapolis is so horrendous, i would like every company to rethink their policies about anything that makes it so that it's easy to track american citizens who may have done nothing wrong.

constitution. >> that's -- as for politics at large, jim, you know, goldman has made no secret they are getting asked a lot about election risk, the implications that that would have on corporate tax reform, in their view it would bring down their 2021 numbers by i think 11%, back to 150. >> yeah. >> bloomberg has a piece out this morning they're saying if you are looking for one narrative as to why we got a gut check yesterday it may be predicted shows the risk of a blue wave is increasing. do you think that's valid? >> yes, i think that that's very valid. i think that it would be natural for president biden to say that capital gains should be taxed at the same rate as ordinary income because capital gains are something that the rich people have if he said that -- larry kudlow and i campaigned for low corporate -- low capital gains and low dividends when it was kudlow and cramer, but i'm just saying that it's very easy to see that president biden can

say, hey, listen, who really has capital gains? none of the -- none of the middle class do so let's just change that and raise money that way. that would not shock me. it's not what i want not what i want, but it could shock me i think that they should be higher, but, again, when you say somebody wants taxes higher people say, well, what kind of capitalist is cramer look, i think that the -- i don't like how much the government owes. i think something has to be done but i think that the idea that you would think that the market would come down with a president biden is perfectly realistic scenario >> right in fact, david rubenstein earlier this morning pointed out the last president -- or the last incumbent to win in a recession was mckinley his view is that forecasters see the economy being out of recession by the time the election actually takes place, but that if it were still in it will make it difficult for the trump white house to get reelected. >> wow, mckinley

he wanted to crucify mankind upon a cross of gold great speech by william jennings bryant, but mckinley took the honors there >> yeah. >> mckinley. >> so we are back to a period, jim, where the walmarts, the proctors, the verizons, will be laggards today. >> right. >> i guess we will wrestle with how long that lives. i noticed the journal had an op-ed from the editorial board this morning that says that, you know, more infections will be inevitable, but the cost of shutting down the economy in their words are so great that there is no alternative to opening for the broader public good >> yeah, and i thought that that was the best part of the secretary mnuchin interview. we got we can't close it again holy cow, what a disaster. it's interesting to read the terrific piece in the "wall street journal" about how devastating it was to do what new york did, how new york handled it the worst of anyplace in the country and the shutdown continues. none of us really knows the rules about what's going to

happen in new york i have two restaurants, you know what we're going to have to do, carl, let me know because we took the ppp, trying to figure out what happened, we sell takeout pizza at one place, we have the margarita stand but new york is a shambles and the mayor is still the mayor which is rather extraordinary if he were the ceo of a company i think that that wouldn't -- he wouldn't past muster yeah, look, you're not going -- you're going to buy the john deeres today, the industrials. caterpillar, there we go, caterpillar downgrade so it's only up three. imagine if they hadn't said anything, would probably be up 7. look at the gray le where were they yesterday what were they doing they couldn't be watching sports there is no sports. >> there's golf but your point i think is broadly a good one, jim. >> right. >> i mean, yeah, definitely looking for some of the cream to

be taken off of the top. i think some who were talking -- or watching levels on the nasdaq said let's hold 9850 and if it gets below that we can worry big time. >> well, i just think that people have to recognize that you want to buy them when they're selling them you don't want to pay up right here, particularly on a weekend, going into a period where we have many things up in the air in historically right now. so, i don't know, i mean, look, i think the market is good, i think there's a lot of companies that are doing really well a lot of companies that are worth buying lululemon was down 14, it's now only down 3. that's interesting to me i like that. that's an opportunity. adobe was down 12 last night, adobe was a really good call i had the ceo on last night, it is so clear that they are doing well it is very, very exciting. i think that there's tons of companies that are doing well that you want to buy, but not

everything not everybody is doing well. i mean, wells cap stores being sued by simon property grouper >> adobe is an interesting story and your interview was great. >> thank you. >> their quarter guidance isn't that far from consensus but they did pull 2020 targets, i wonder what you think that means. >> i think that they recognize it's very hard to get a read on all of this different constituencies, retail constituencies, he's got docusign kind of business that's doing incredibly well. see, isn't that great? that stock was down so badly last night, people wanted to throw it away and then you listen to the conference call or listen to the interview that we had in the conference call and you recognize what a powerhouse that they could do these kinds of numbers in this kind of slowdown and he gives 30 million copies away of his most important adobe illustrator to kids so that he can equalize things he is not a guy -- he is not

what i call a hearts and minds guy which is my hearts and minds go out his product goes out and that's what we need to see. his a true great american doing fabulous things for this country and he's also doing great things for his shareholders >> yeah. interesting. adobe up almost 18 as we're a stone's throw from 26 k once again on the dow. let's get to rick santelli this morning in advance of some data at the top of the hour hey, rick. >> yes, we will get a university of michigan sentiment on top of the hour, preliminary read for this month if you look at a two day of tens it really has been a wild week we were down to 64 basis points inter day yesterday and now we are just crossed 70 basis points which means we're down pretty much exactly 20 basis points on the week, 30s are down an equal amount and if you look at a one-week chart what really should jump out at you is the fact that we really fell every single day this week except for

today, but today obviously isn't finished open the chart up to early march and you can see the reason 64 made many traders a little nervous yesterday, it's only 10 basis points off the highest -- the lowest yield close ever which was on the 9th of march as you see on that chart. if you look at a month to date of the dollar index, we are down 1.6% currently for the month of june, a fairly astonishing amount if you go back just a few more days beyond that month the numbers get bigger down close to 3% what really is amazing with the dollar index is if you go to year to date chart 9640 is where we settled last year, we only had one day the 9th of march where it was lower until this week, of course, we had our second day, we are now hovering slightly above unchanged on the year and only down slightly on the week as far as what happened yesterday, probably jay powell not being optimistic and covid news, but i'm not sure politics -- i don't remember

president dukakis, we would have had one if the polls were accurate at that point in history. carl, jim, back to you >> rick, thanks a lot. let's get to bob pisani and see what's moving on the floor over there. >> here we go again. we've regained almost half of the losses, it's the reopening story here take a look here, transports, russell 2,000 rallying, banks and energy all above the s&p 500, retail as well. just very hard to figure out what's going on. just look at the energy stocks, another rally today, but you watch marathon the last seven or eight trading sessions goes from 6 to 9 to 7 dollars, all of these stocks have done the same thing, the same with the industrials, you look at the airlines, united airline went from $30 to $50 in a few days and then back to the 30s here as you can see. general electric same thing went from 6 to 9, now it's back into the $6, $7 range, very confusing figuring out what's going on you think the banks would be better they are now, though citi group, same story citi group went from $48 to $60

and now it's back to the $48, $49 dollar here. remind everybody what moves markets and what has been moving markets those buckets we have been talking about valuation, we overvalued or undervalued. figure was clearly a vote for overvalued, but who knows? the reopening story, we are resetting the pace of the recovery, the fed has pricked the v recovery proud but certainly a positive on fiscal monetary stimulus, big packages are coming there should you buy the dip right now? we have had a 6% down side day, pretty rare, 5% down side days, we had several in march and every time you would have bought that it would have worked. we are above where those numbers were even on march 18th. remember what drives stocks, the problem right now is the earnings growth, the dividends are not growing, market multiples are expanding or not and the liability of course the liquidity out there, money to buy stocks or not certainly not. finally nyse definitely going to be expanding next week, the

reopening, bringing more dmms in, slow pace of their reexpansion, but that's happening next week. back to you. >> all right that's going to be interesting to watch bob, hopefully we can be a part of that, jim, at some point down the road. >> i hope so i miss you >> there is a look at the s&p 3081, vix 37 after having gone from 24 to 40 in a bike. back in a minute you can't predict the future.

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letter to the partners or employees this morning saying it will be partnering with the starbucks black partnering network and black starbucks leaders to make 250,000 shirts available to company operated partners in the u.s. and canada to affirm the company's support at this critical time in our history. until the shirts arrive, partners will be able to wear their black lives matter pins or t shirts in passionate support of their community and humanity. this letter goes onto say as we talked about earlier this week, we're designing new t shirts with the graphic below to show we stand together in unity until these arrive, we've heard you want to show your support so just be you. wear your blm pin or t shirt we're proud of your passionate support of our common humanity starbucks is a place where we're all treated with dignity and respect. this is after a story of them not allowing baristas to wear

shirts or pins on the job because it's in vital of the dress code policy. at that time there was pushback, particularly on twitter with #boycot starbucks the company is saying the partners and employees are allowed to wear the blm attire and the new shirts will be arriving in stores >> kate, thank you jim, the reporting on that last night was curious interesting to see them come out with such a stance >> look, i believe in free speech, and i think this is a level of free speech that i thought kevin johnson would support, the ceo and howard schultz tried to do a race initiative. it was poorly timed, but look, if you can -- if companies can have free speech, allow people to have free speech, i think it's a good thing.

i just am pro -- look, i'm pro social change here there's just no two ways about it you're either pro social change or standing in the way of social change >> the period where they tried to ride both trains, jim, that's over that period is over. >> right >> you can see that from some of the zigs the companies are having to make and are making. we are up 718 on the dow a lot more with jim when "squawk on the street" continues after a short break. there are times when our need to connect really matters. to keep customers and employees in the know. to keep business moving. comcast business is prepared for times like these. powered by the nation's largest gig-speed network. to help give you the speed, reliability, and security you need. tools to manage your business from any device, anywhere.

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t time for jim and stop trading. >> i've been killjoying a lot of names but norwegian cruiseline holdings is the one i believe has the best opportunities it's got some new ships. he has a lot of great things going. he'd been fixing the balance sheet. it's been clubbed. it's down 66%.

if you do want to play that group, i would play it with norwegian. because i think they're so well run. >> interesting i see carnival today, the holland line extended their pause of operations but you're choosing a favorite here >> yep i think norwegian has incredible prices for next year, and i'm trying to convince my wife, because i think they've got -- i have been on their new heaaven line they're fantastic. if you get a vaccine, you'll want to buy the cruise prices right now. that's a good informationment with a vaccine i'm counting on j&j and regeneron and on my wife recognizing if you're in the haven part, you get to watch the cabbing of the glaciers, and i think alaska is terrific >> jim, we're going to see you tonight. we're actually going to see in the 11:00 as well? >> yeah.

because this azik is something i know, the ceo. i lover the product. -- i love the product. it's great to see companies made in america that's recycled this is the kind of deal i like. tonighti have zuora, and michael neidorff with centene. what a horse that is, and he explains things better than most in health care miss david >> one day we'll be together >> i know. we'll see you in a little bit. jim's going to join us on squawk alley. in the meantime, good friday morning. i'm carl quintanilla with sara faber. let's get consumer sentiment with rick. >> yeah. carl, these are a bit surprising we were expecting the number around 75. we jumped up to 78.9

that's a small victory and the best level since march of this year of course, because it was at 89.1 then. then it dropped to the low 70s if we look at current conditions, it moved from 8 2.3 to 8 7.8 expectations from 65.9 to 7 -- 73.1 the one-year inflation moved from the 3.2 to 3% 3 .2 read we had in the final of last month, that was the biggest p of inflation since the summer of 2014. it did moderate a bit to 3%. these are preliminary readings we'll knock them out in a couple weeks for final readings and the five-to ten-year read, moved to 2.6 inflation the numbers at least show there is a significant worry about inflation. it just -- the timing seems to be in question sara, back to you. >> rick santelli

rick, thank you. stocks on track for the worst week in three months despite the rally today. gaining some of yesterday's steep losses back. we're looking at declines of around 3% or more for the week the chief economist david rosenberg joins us now david, these moves are insane. 40% runup in a matter of months. a 30% before that in a month the bull say yesterday was healthy. i have a feeling you disagree. >> well, i guess that the bulls will say we took some froth off the market by let's take a bigger picture perspective. the market has been on a manic roller coaster ride for years. we can go back to the fourth quarter of 2018 when we had a 20% correction forced the fed to cut rates when they were supposed to raise them after a 20% down fourth quarter of 2018, 30% up last year.

when the 30% meltdown. the fed has to come in again dramatically the market rally is 40%. it's been a roller coaster ride. if you look at the bigger picture, taking a look at the total of return in the stock market, it's no higher today than it was last july. so you were left with a dividend of no return if you're asking what is the place can be inconsistently that doesn't get a lot of attention in the media is the long bond. the stock market this year despite the ups and downs, the pandemic, lockdown and policy response, you're negative 6% on a total return basis the long bond is generated a plus 25% year to date. and nobody talks about it. >> you could also be in the bonds of coca-cola or microsoft or apple all these companies issuing debt the blue chip companies have had

even bigger returns. what does it say about the environment we're in. >> with the stimulus and the fed coming in and backstopping the credit markets, you've had a massive risk on trade. the difference between buying a corporate bond as opposed to, say, a treasury, even with the amount of fiscal deficits is this is what makes the treasury markets special and different from any other asset class is that you know full well what you're getting paid at the end of the maturity. no other asset class gives you that complete preservation there's always rate risks and inflation risks. but with treasuries, there's no capital risk you buy even a high quality corporate muni, you may lose money on that. the reality is if you're holding the bond to maturity, you know you're getting paid at the end of the day i'm bullish on the bond market the fed gave us important information on wednesday they're not raising rates for years. even in the next three years,

inflation does not even come close to their target. and we're left with a huge output gap and they're already talking about yield curve control. it tells me we're going to take the long bond yield in the united states by hook or crook down to .5%. that's something i can see right in front of me if we get to .5 % on the long bond -- most people don't understand the tradeoff between convexity at the low levels of interest rates if you buy long dated zero coupon bond today and we get down to .5 on the long bond, that's a 36 % total return i know that everybody is focussed on the stock market, but the real money is going to be made in the long end of the treasury curve >> dave, of course that would go in reverse if, of course, yields went up. just to make sure people recognize, you're talking about price changes at the long end of the yield curve can be dramatic in terms of returns. i want to get from you the idea of what has to happen, if

anything, in terms of the economy for that bond bet to pay off. is it immune to the idea that we're past the worst of this extraordinary recession, you have jobless claims that peaked on the way down. consumer sent want seems like it's on the way up can you own long treasuries and not worry about the fact that maybe people think the economy is getting better? >> the economy is going to get better in the third quarter. we'll get the rebound. the atlanta fed right now, the forecast for second quarter is like negative 48% in annual rate we had a deflationary detonation in the second quarter. there's reflects of rebound. no doubt but the outlook is uncertain that's what the stock market didn't want to hear from jay powell what i'll say to you is there's not going to be a runup in interest rates without there being inflation, and the supply and demand of balance is huge. it's going to take years to get

there. and it's interesting, the san francisco fed two months ago did a report on 15 pandemics back to the past 500 years and they found there's aftershocks after the earthquake and they're deflationary you end up with a huge savings investment and balance that take interest rates down past the worst point. i would say is there a risk that interest rates would go up in the next two or three years? there's always a risk, but i wouldn't make that a base case scenario interest rates out the curve are going to be moving lower and lower over time. we're not through the deflationary situation just the cap is too big. we have to climb out of this hole look at the fed's forecast it's going to take years just to get back to the starting point if you look at what the cbo told us the week before this week, they said it's going to take eight years. in their forecast, eight years

to get back to the starting point from the precrisis trajectory in gdp. the odds that we're going to get interest rate increases on a sustained basis, i see it as a low odds event it's more japanese in nature than people believe. >> in effect, that means believing the consensus got it right. bond inflows have been massive into investment grade bonds. it's interesting to hear you sort of putting faith in the fed's forecasts out two years when it seems to me in past years you didn't think the fed was any good at forecasting the economy. >> well. it's not just based on their forecast the san francisco fed in my opinion, they put out among the best research out there. take a look at the report they put out two months ago on the multi-year aftereffects after a pandemic this is a supply shot and a demand shock the initial impact is, of course, deflationary shock through demand

but what happens over time is that the excess supply of savings drives the natural rate of interest ever lower we started the cycle at egregious ly low level of where the neg -- i don't have to go to negative interest rates. in a period of deflation and the fed pegging the funds rate at 0%, almost to perpetuity, the long end of the curve is going to continue to gravitate lower and the total return, the power of convexity at the low levels of interest rates is going to generate powerful returns at the long end of the treasury curve you can talk about corporate credit the flow has been going to corporate credit spreads blew out that was a relative trade. but you can't get the duration in most corporates that you can get in the treasury market you can actually get great duration own the assumption drives inclusion here i think that's what people are missing. we're also focussed on the

equity market as if that's the only way you can make money. and it's become a bit of a casino but the bond market is trading more on fundamentals people aren't opening up robin hood accounts to trade bonds and so if i'm right on this, and i'm especially right on what the fed is telling me at the short end of the curve, i think at some point they'll go to yield curve control policy it's happening in most other parts of the world you're looking at what is the odd man out here as much as you'll say a 1.4% i don't think bond yield is egregiously low, look at where long term rates are trading around the world the u.s. is the one-eyed king. so i would say that's really the place that you want to focus your attention on. not just the fact that bonds are a stabilizer in the portfolio. they're going to make you a lot of money in the next 12 months if the yield curve flattens and

inflation rates. >> the only thing i have is consumers do appear a little bit more confident and a little more willing to go out than i think you and a lot of folks expected. we just got that number on sentiment. we're watching the tracking data we don't even have a treatment or vaccine both of which are in production, with companies spending all their resources on that and a lot of optimism we're going to start to get some at least bridge treatments to get us through the fall i mean, what happens in that scenario that's the optimistic case >> it is tell me what the market has been pricing in for the past three months the market has been pricing in a vaccine coming to the fore by the end of the year. pricing in tremendous fiscal monetary stimulus. the market has priced a lot of this in. maybe not all of it. the market wasn't pricing in nothing over the past few months it's not every single day on

three months you get a ten multiple point expansion in the stock market earnings expectations have been coming down because the market is looking to the future that's exactly what they're pricing in is that going to generate inflation? is that going to mean that all these millions of people that lost their jobs are going to come back right away we built up a huge imbalance between supply and demand. that's what drives inflation consumer confidence in the month of june does not drive inflation for the next several years it's all about supply and demand and that gap is not going to close just with a vaccine. we're going to be into a multi-year period with or without a vaccine. that's how deep the shock was. and the hole we have to climb ourselves out of that's going to be in place for a long period of time. the fed's already told us, powell told us at the previous meeting to the one on wednesday that the fed is going to an cover short-term rates at zero well past the point of recovery.

that's like -- you know, that's like a free pass for the long end of the curve and inflation is not going to go up just because we get a vaccine. we still have to work through the cap. it's going to take years i say that's the wild card here, and the place to have made money in the past year and year to date has been in the long-end of the treasury curve i don't see that changing. >> all right always good to get your thoughts thank you. >> thank you all right, we have avoided as we did many times earlier in the year a second day of massive declines big bounce in the airlines we'll check in with one of the key analysts on the street about what the traffic patterns may mean for the stocks when we come back that's been through multiple market cycles for over 85 years? with capital group, i can. talk to your financial professional or consultant

for investment risks and information.

airlines rebounding in a way after steep losses in yesterday's session. joining us is he lain becker to talk about the group good morning you've covered this industry for quite a while. i'm sure this is maybe the most extraordinary period of time the last few months to follow these stocks you've had a near disappearance of all air travel followed by bankruptcy risks, a bailout, and the stocks are the favorite play thing of some retail traders after having been shorted to maybe close to zero. so where does that bring in you

terms of navigating the big names in this group starting with is american airlines going to remain out of bankruptcy insolvent and take it from there where you think it makes sense in terms of opportunities. >> yeah. so it's -- you're right. it's been ptsd driven for the past three months as we've gone through all the things you just talked about and you know, we saw 500,000 people travel yesterday through tsa. i'll point out that back in april it was taking two and a half weeks to get to 2 million people, and we did 2 million people this week we're still down 80% year over year, don't forget, but we've seen an improvement, and carl noted earlier this morning that i said that we'd be 400,000 passengers by august and a million by the end of the year it looks like we may be there sooner i think that what the airlines

are doing to convince people how safe it is on board the aircraft is important we don't think american is going bankrupt i don't think failure is an option for any of the airlines, and for american, think about it this way everybody talks about the stressed balance sheet they'll have $50 billion of debt at the end of this quarter but they don't have to pay 100% of it back right? they just have to pay back half of it. and another $6.5 billion they get from the government, they have a decade to pay back. the pension plan is 74% funded so they only have to get it to 80% by 2024 and they made some voluntary contributions in the past couple years that have them in a good position so we don't think bankruptcy is on the table for them. and they said this morning in a press release that they'll will cash flow break even by the end of the year. i think that took a lot of

people by surprise, and i think you've had this combination of better than expected numbers the traders that you pointed out, and then there's been short coverings. so i think that's why american has done so well recently. but if you go through the analysis, you don't have to get to zero debt by any time frame >> sure. should american or do you think they will, issue equity just to shore things up a little bit >> yes in fact, every airline should issue equity to shore things up. i know it's an expensive form of financing, and i'll probably get lots of emails telling me how wrong i am, but that's okay. i think if you issue equity, you're doing it at -- yes, you're issuing equity at a point in time where your stock is cheap, but on the other hand, you're not adding debt to the balance sheet that you have to pay back every dollar of debt has to be paid back at some point in time. yes, they should issue equity.

>> elaine, it's carl everyone is celebrating the return of i guess it's domestic travel, but how much of a hangover will corporate and international corporate travel be and for how long? >> yes hi, carl thanks for asking the question here's the thing you can't -- remember a year ago we were doing 2.7 million passengers a day and if international is 40% of the total and you don't have any international, right there you're taking out a million passengers then for corporate, figure corporate is about 15% to 20% of the total they provide half the revenue. so i think that without corporate coming back, you're not going to get fully back to where we were a year ago it's going to be visiting friends and relatives in leisure. tons of people have come on your various programs and talked about this but i think that airlines have to figure out a way to be profitable with leisure going

forward. because i think business is going to take a while to come back i've heard some of our clients have said they're not even going to be traveling this year at all between now and the end of the year other than for personal reasons. so i think that that's probably not atypical of what a lot of corporates are thinking. >> yeah. and i wonder if you think corporations, when they are assessing travel needs, i'm assuming they're not going to be driven as much by fair discounting and as for venues to go to. we have disney opening in california and florida there's little indication that conferences are on their way back to an equal degree. is that right? >> it seems to be that way i'm hearing more and more conferences including our own big september conference that we always hold in boston is going virtual this year. and that's unfortunate right? i mean, for people who have their careers well-established, it's okay not to go to conferences in general,but for

people who are young and starting out, you like that conference for networking, to build your network you need to see people in person it's really unfortunate that this is putting all of that on hold but yeah, we haven't heard of too many conferences going live this year right now. it's really unfortunate. if you had told me in march i'd still be working from home in june, i never would have believed you >> and in terms of sort of immediate investment implications, i know you recommend american, southwest, a couple others, but the price target aren't too far above where we're playing right now. how would you play them? >> i know. i have to think about that here's what i think. that the stocks, when you think about the recovery, it's who is going to win the recovery. i think we've moved past how we're going to survive the downturn right?

and now as an airline manager, you have to think about winning the recovery, and i think the airlines that win the recovery are those airlines that if you fly 60% full until july or september, the good news is that you keep more people employed so as demand recovers and if we have a vaccine in the fall or the winter, you have that ability to recover quickly and i think that's really important. and so think about where the stocks were in january right? i mean, american it was 35 a share, and obviously there's going to be delusion with the government's ownership, but why can't the stock move up from current levels when the stock was at 11 or 12, we thought it could double it doesn't seem like a brilliant call right now, but it was then as a contrarian name why can't the stocks get back to

preco-vid levels, maybe minus a 10% discount for additional delusion in an environment where we're in a recovery. we have said as carl pointed out earlier, three to five years and if we get there in two or three years, i would think that's huge. >> great to get your take. thank you very much. >> thanks, everybody thank you. now time for our etf spotlight. today a look at the banks. ticker kbe rebounding after yesterday's massive selloff. still on pace to snap a three-week win streak and post the worst week since mid march the big commercial banks in the green led by citi group. along with the broader market which is claiming back not enough to make up for yesterday's deep, deep slide, or the week's more than 3% loss but still the dow is going strong up 689 points. stay with us on "squawk on the

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♪ yeah as business moves forward, we're all changing the way things get done. like how we redefine collaboration... how we come up with new ways to serve our customers... and deliver our products. but no matter how things change, one thing never will - you can rely on the people and the network of at&t... to help keep your business connected.

we thought you can help ray bring hiwhat?s to school. kelly, do you know him? -he's a new friend. you ok? you know you can tell me. i'm ok. oh, i trained her in the car. she's not gonna break. [ laughing ] welcome back, everybody. here's your cnbc news update at this hour. air travel continues the comeback more than a half a million travelers went through tsa check points yesterday it's the highest daily total in over two and a half months and a 28 % jump since last thursday. travelers are down 82% from the

same day last year, but the numbers are a big improvement from the 90% declines at the worst point in the pandemic. the republican national convention is now officially moving to jacksonville, florida. originally set to happen in charlotte, north carolina the convention was moved after state officials refused to guarantee the event could be held at full capacity due to covid-19 concerns a two-day man hunt has ended in a shoot out police say mason james lira shot one officer on wednesday own three more on thursday he was killed as retried to escape his hiding spot in a river bed. u' uyorep to date. squawk in the street continues in just a second ♪

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a cautionary stance from the fed this week did send stocks plummeting on thursday as you know rebounding this morning. dow is up off the best levels of the day. we were up 827

joining us is allen blinder to talk about the fed's response and the market's action. great to have you back congratulations on that princeton chat with powell it was very warm and greatly informative. great job. >> he's a good person. >> i wonder what you made of the presser this week. does he need to tidy anything up going into the house and senate next week? >> well, he might tidy up the outlook. i think he was misread as being gloomy and doommy. i actually looked at the sap, at the projections. i wouldn't call them optimistic. who is optimistic in this day and age, but they struck me as the slightly optimistic side if you did the arrhythmmath, th

expecting it down. to me it's optimistic more than pessimistic. >> what does that mean for policy going forward, and do you think that's being misread by the market >> i don't think so. i think the view in the markets is the fed will do everything in its power to try to mitigate the damage and then when the time comes, to give the economy a little bit of a boost out of the recession, depression, whatever you want to call it. we don't have a name for anything like this, lows i don't think the market is misreading that. what i do think, and maybe that was part of yesterday's market reaction who knows? people in the markets tepid to think of the fed as a superman that it can do anything. it can't it has lots of power it's using that power, but it's not superman it can't do everything it can't put money into the hands of people that need it as

jay powell keeps saying over and over again >> allen, it's sara. one of the debates today is whether the fed encouraged the buy the dip crowd. where are powell made it clear high asset prices aren't going to stand in the way. interest rates are going to be rock bottom for years. so that forces people to buy risk assets and growth in particular it's free. right? >> well, i mean, it's half right. the fed says we're going to do stuff to try to improve the financial situation, that's probably going to be good for financial assets and to your point, it encourages a bit more risk bearing than the day before or whatever the fed said that. but powell didn't say anything at his presser that he hasn't

said before. he wasn't doing a victory lap or promising vast new programs that the fed might or might not be able to deliver. it looked to me more the case of the markets viewing incorrectly viewing there's a fed put under every asset which is not right >> there's also the budding debate over inflation versus deflation. the demand so weak we're going to be in a deflationary period or years or are there green chutes of inflation, and what will it mean for potentially a slow recovery? where do you come down on this >> i would come down, over the term that you're talking about, the next couple of years, firmly on the deflation side. i'll be shocked if the fed is able to get the inflation rate

up to the 2% target within a few years. look, it's been trying to do that for years and years in a strong economy, unable to push things it almost got to 2 % or maybe hit it for a month or something, but basically has been undershooting inflation in a strong economy we now have for some time, a weak economy and that's -- that pulls down the inflation rate not pushes it up if you look way, way ahead, five years from now, ten years from now, well, two knows there is a huge amount of reserve creation of blowup with the fed's balance sheet. at some point it may be a challenge for the central bank to pull back on those things to prevent inflation, but that's in the deep, deep future. and you can see it in bond prices people that trade the ten-year treasury are not worried about inflation. >> alan, speak act the asset

purchases that the fed is doing, chair powell was asked about the purpose of it, the motivation behind it. he said they wanted to get market functioning back onto a smooth place, and he's not taking the gains so far and the liquidity of the market for granted. implying this is still all about market functioning as opposed to incremental easing is that still the case and i guess does it matter how we define what they're doing >> yeah. that's a good question whether it matters i would have changed the prose a little bit more to be sort of j so to speak, equally waning between -- weighted between preserving that market function which is where all this started or had to start, and giving the economy a boost, boosting aggregate demand, the rationale for qe1 back in the financial

crisis if i was writing the words, i would have slid a little bit more in the direction that you menti mentioned. i was struck when i read the statement they didn't do that at all. that it was the same maintained market function. even though marketingare functioning pretty well. he was saying should there be any hiccups or worse in financial markets, the fed stapds at -- stands at the ready. >> finally, alan, on a much more superficial topic, this week the president said he sees numbers better than the fed. kudlow suggested that powell needs to smile more and get media training i'm not going to ask you about those things but i wonder do you think we're done worrying about powell's stability in terms of his tenure right now and about outside pressure >> i think we are.

i should say we have the most mercurial president in the history of the republic who had for a while the idea that he can fire the chair of the fed, which he cannot, but he can easily turn against him i'm sure powell understands that right now he's been quiet about the fed which i guess we read as satisfied with what the fed is doing. as always, donald trump as president, i would never say the potential of battles between the white house and the fed are over i hope they are, but i would never forecast that under a trump presidency >> wait. hold on. i mean, maybe he needs a scapegoat here running for election, reelection, but what would that do for confidence is in the middle of one of the deepest recessions in economic contractions we've ever seen, and a pandemic, that is still

very much alive the president tried to force out the fed chair? >> it would be a catastrophe it looks to me that people in the administration are in the justice department or wherever convinced him months ago that he couldn't fire the fed chair. so what i was talking about was not firing the fed chair an attempt to do that would be catastrophic to the markets but just starting to bad mouth the fed. remember when he was calling them loco, the biggest threat to the economy, out of their minds? he was doing all kinds of things like that. not anymore. i hope it stays that way, but that's what i was talking about. you're right if he should start culminating about firing the fed chief, the markets are not going to like that at all, nor should they >> alan, thank you for that good guidance and congrats on the princeton chat hope to talk to you soon

have a good weekend. >> you too >> alan blinder. the biggest gainers on the s&p, reassertion of the stay at home trade take-twontacve ierti, color rocks, activision blizzard, electronic arts up the most. don't go anywhere. this is decision tech. find a stock based on your interests or what's trending. get real-time insights in your customized view of the market. it's smarter trading technology for smarter trading decisions. fidelity.

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losing momentum in the markets. we were up almost 800 points on the dow, now up 400. cutting the gains in half. top stocks on robin hood, fan favorites like tesla, apple and nikola getting crushed in the app on yesterday's selloff we look at the biggest winners and losers in the retail space >> bullish robin hood investors have been on a streak. they picked stocks with some of the best returns but as the momentum turned around yesterday, some are getting squeezed the top names on robin hood as of the close yesterday were all in the red that's according to third partying a ge gator robin track. ford was a top pick. it was down 10%. the airlines which were a winner for some investors as they rebounded were down double

digits carnival falling 15% robinhood's ceo saying they were seeing a lot of buying in industries hit by the pandemic traders were favoring names like delta with expectations of a swift economic recovery. bar clay is weighing in saying robinhood's top trades and retail traders are not behind this rally they're saying that the more robinhood customers moving into a stock -- excuse me robinhood traders moving into a stock means that they might have lower returns rather than higher they found no clear relationship between robinhood customers adding shares and s&p moves. two other names to tell you about, tesla and nikola. they were down 5% in yesterday's session. nikola back in the green today tesla has not recovered from the losses

guys, paback to you. >> that's what we heard from morgan stanley's james gorman earlier in the week. it's interesting and there's a burst of speculative retail in trading but it's not driving the overall market because the numbers look slow it sounds like that's what you're hearing >> that's right. from barclays this morning, saying that as well and the timing so yesterday we did see a lot of the stocks in the red, but it depends on when you buy, and of course, they are rebounding today. we'll see if some of them can get back some of the momentum they say over the past two months cht. >> kate, thanks. later today on the "closing bell," the ceo of wyndham hotels and resorts talking about reopening and travel trends. that stock down more than 25% for the year see if they're seeing any green chutes in terms of people wanting to go out and take vacations again. 3:00 p. eaer.mstn. we'll be right back on "squawk on the street. stay with us turn on my tv and boom,

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some news out of starbucks whether employees can wear black lives matter t shirts. kate rogers has that story >> hi. starbucks out with a new letter to the employees partners as it calls them this morning. saying it will be working with the starbucks black partner network and black starbucks leaders to make 250,000 shirts available to company operated partners in the u.s. and canada to affirm support at this, quote, critical time in our history. until the shirts arrive in stores partners will be able to wear their blm pin or t shirt while on the job a letter from leaders says, quote, as we talked about earlier this week, we're designing new t shirts with a traffic to show we stand

together in unity until these arrive, we heard you want to show your support. just be you, wear your blm pin or t shirt we're proud of your passionate support ofour common humanity. we trust you do what's right whi a story came out on the company not allowing the baristas to wear black lives matter attire like shirts or pins while on the job because it violates the dress policy which also extends to political, religious, or personal accessories or clothing buzz feed reported on an internal memo in which managemethere wa a possibility it could be misunderstood. some called for a boycott of the brand. the company saying yes, you can wear your blm attire until the t shirts come in stores. carl, back to you. >> all right hopefully we learn more about how they came to this decision,

kate thank you. starbucks. meantime we have gains dow session high up 800 plus we're holding 3050 barely. yesterday's intraday low was 29999. back in a moment etween excellence and mastery is all the difference in the world. the lexus es. a product of mastery. experience amazing at your lexus dealer. find a stock basedtech. on your interests or what's trending. get real-time insights in your customized view of the market. it's smarter trading technology for smarter trading decisions. fidelity.

i'm an associate here at amazon. step onto the blue line, sir. this device is giving us an accurate temperature check. you're good to go. i have to take care of my coworkers. that's how i am. i have a son, and he said, "one day i'm gonna be like you, i'm gonna help people."

you're good to go, ma'am. i hope so. this is my passion. if i can take of everyone who is sick out there, i would do it in a heartbeat. stocks are looking to rebound here after their worst day of trading in three months is yesterday's sell off an opportunity for the retail investor to catch the next rally? joining us now is jim stewart, boy yesterday was an ugly day, jim. >> yeah, it was really -- >> it makes you wonder it was rough, is the trend

reversing. what are your current thoughts and advice to individual investors right now. >> as i said before the market at the previous high was pricing in call good news. i'm not surprised there was a pull back and then a whiff of not so good news the cases, the hospitalizations, some of these chief states that said, the move wasn't big enough, and it is up 6%. i typically look for a 10% high. that is a little arbitrary, but it worked pretty well through this process i would say we're not there yet. we could get there i mean secretary mnuchin was

going to recommend but they were in california, texas, okay, these are big populous states, and i think that data will be very important to watch in the next few weeks >> the other thread is this mania around stocks, especially that hearse wants to raise an equity offering in bankruptcy, and the return of the retail investor around some of these speculative stocks, what do you make of it all >> i think that is a classic mistake that a lot of individual investors make which is potentially chasing the returns. they saw the headlines, they saw the stocks surging, they get all excited. but frankly by the time, you know, by the time the rest of us are hearing or reading about that it is already too late.

i don't think the bryce with so much uncertainty is a time to go way out on the risk curve. there are a lot of very solid companies out there that are paying nice dividend yields. why search for these really exotic very little known stocks looking for that, you know, that sudden pot of bold i don't think this is a time to be especially greedy it is a time to stick with a disciplined plan that has been in place for some time, you're comfortable using, and just relegislate it >> last week we talked about election risk and what the predicted markets are saying about the house, the senate, and the white house.

but firms say they're getting that question a lot. >> i think it is premature there has been a lot of noise in the last week or two on the far left and there has been a lot of that occupy wall street rhetoric resurfacing in sperms of some of the protests i'm hearing that, too. a lot of main street investors are not that far left and it makes them everybodious when they start to hear about issues like major redistribution incomes and reparations of some massive amount i think if you look at the broader polls, it is not, you know, the vast majority of people have not lurched far to the left biden has been resisting some of the more far left rhetoric coming out of all of this and i

just think at this point we have a very tumultous period, but i think we need to wait a little bit and let it calm down i would be surprised if we're going to see talk of major left wing shift in policy >> and it probably always makes sense to just remind people that the amount that investors seem to fixate on for an election it seems a little disproportionate sometimes to what it seems like for the period after the next great aggressidepressil they have a insolvency cycle is there going to be a few percent increase in the corporate tax rate

it's unclear if that is the inflection point for the market trend either way >> if you look at the broader picture, we don't have a government that is set up for radical change if you look back to the obama election, we hada democratic white house, two democratic houses in congress, our first black president, what came out of that was not some radical revisi revision and it wasn't radical enough we're still going to have a very strong republican presence in congress, i think. a few investors have been saying they're worried about it i think that is premature. we had so many things to focus on first, getting a vaccine, getting a cure for the virus, and getting the economy back on

track before anyone will be in a position to really talk about some kind of major, you know, economic shift in policy >> the other hot boten debate is growth versus value. they have given back a lot of gains since they started to improve. do you a strong opinion on what part of the market will work >> this, in a pull back like this in this kind of environment is usually the value stock that comes to the floor because their projected earnings are so much lower and that as generally not been the case even, you know, there was a little value rally just before the virus hit but

that that didn't amount to much. so i think there is a lot to be said there is a lot of hope, there is a v shape, and they will celebrate quickly. but i think you ought to have a plan for what you want in growth and what you want in value it is time to add a little value. >> jim stewart, always good to get your thoughts. carl, here with the s&p up with a percent. watching the gains slip here >> yeah, we'll see what happens this afternoon and sara