we'll talk to dr. scott gautley. new pandemic rules for summer. plus china, out with upbeat jobs and retail data and a sign that the economy there started to pick up steam. it's monday, june 15th, 2020 and squawk box begins right now. >> good morning, everybody welcome to squawk box here on

cnbc i'm becky quick with joe kernen and andrew ross sorkin the market has come under significant pressure this morning. and the nasdaq off by 143. it's all coming this morning a rough week for wall street 5.5% that was the worst week since march 20th and all three are coming off of their biggest weekly losses and last month after last week. the dow and nasdaq for the month of june would be down with the projected losses that we're looking at this morning. s&p is already down for the month of june. also keeping track of the treasury market this morning let's take a look at that. treasury yields yielding 0.08% crude oil prices under pressure this morning too

this is a sign of how much is anticipated in terms of a come back not only here in the united states but around the globe and right now wti down about 55 cents. still trading $35 though at $35.71 andrew. >> thank you, becky. i hope everybody had a great weekend despite some of these losses that we're looking at in the market i want to start with key market events for the week ahead. fed chair jay powell is going to begin two days of congressional testimony that starts tomorrow investors will be looking at more hints about the economic forecast and stimulus plans last week also a read on retail sales tomorrow and closely watched jobless claims number. that comes on thursday so a lot of data and information for the markets to chew on this with. >> we'll get an update on the surge of coronavirus cases and north carolina and south

carolina and also oklahoma all reporting record numbers of cases. hit new records in arkansas and utah and texas and north carolina over the weekend. meantime given that backdrop a word of caution from new york's governor andrew cuomo reopening in the tri-state and the state received more than 25,000 complaints about businesses violating rules of particular concern. large groups of people gathering outside of bars and restaurants providing services and calling the problem rampant and said liquor licenses and bars and restaurants caught breaking the law so that's something that folks need to be watching for as well >> thanks.

>> spike the spike in new cases. speaking to cnn over the weekend. larry kudlow said the current unemployment benefits are an incentive not to return to work. it's paying people not to work it's better than the salaries can get. it will end in late july >> it could push more people to get back on the job. it's something that we talked about already with rob portman the senator from ohio that had seen belief from democrats and republicans for coming up on this give them a $400 bonus.

>> talk about it a lot and the disincentive and some people think if we heir on the side of too much it's all right for a little while and then the numbers for the first month of every friday we're not sure how to interpret them and it was kind of a mirage so the numbers are all skewed i don't know where it would stand right now. it's very difficult. and he was talking about how people really have lead. they lead the closure and they're leading the reopening. and locally and federally to get guidelines that's why you're seeing so many people out right now and he doesn't think that it's a second wave right now and they didn't really have the first wave and we should have never considered how the new normal would be to

navigate when we see the new normal being difficult to navigate and people hate the new normal, that turn but i guess we shouldn't be surprised this is going to be uneven for months and years i guess. >> i have spoken to small business owners and ceos of companies too that say they have had trouble getting people to come back to work. some of that will be people that can't come back because they're taking care of children or have underlying conditions but i've heard from other people that say they're making more money on unemployment now than they would be if they came back. >> yeah, china. >> the other complication that i was going to add is as we get more cases in some of these states and it's clear that we don't have all of the ppe and it's clear that some of these businesses as we know are doing very well in providing a safe environment we're looking at things where the environment isn't safe there's people by the way talking about providing bonuses,

what they're calling bonuses so there's a debate going on in this country about whether to work, what we need to do to incentivize people to work and how do we get people to do it safely so to me it's such a multidimensional issue in some states it makes a lot of sense and it's more complicated. >> you were talking about cuomo saying the people out on the streets drinking out on st. marks street and the bars that were open and serving them. >> what we were just talking about is there are businesses now, bars, restaurants and others that are not following the procedures it's not just in new york state. this is across the board and when they're not following the safety standards, it's not just that the customers aren't following the safety standards or being subject it's that the employees can become subject and then it's the debate about whether they want to work or whether they should work given the conditions so this becomes a circular or

vicious cycle depending on how you think about it and that's part of the debate also and gets incorporated into the bonus idea. >> there's a town in new jersey that governor murphy is now suing because the entire town counsel voted to allow restaurants to have people come back and eat indoors at 25% against what the government had layed out. >> based on a lot of money sloshing around and people think that gracie train ends abruptly. and at that point it readjusts

and a position and i understand why they're pushing that position it's good to have well-known skeptics because that helps people stay uncomfortable long in china there's cases over there and they're rying to trace where they are coming from again. here's positive news about the economy in china the unemployment rate fell 5.9%. there was a record prior to that, 6.2% for the record. industrial production jumped 4.4% year over year. they down year over year.

>> this is exactly what you were just mentioning. a cluster of new coronavirus cases raising a worry of a second outbreak. many tied to a major wholesale producer market on the outskirts of the city. it's been shutdown since saturday and they're on strict lock down with no one allowed to enter or leave and they're conducting daily temperature checks there butanother sign for a main concern >> the park has been closed since january 26th all guests need to make reservation for their visit ahead of time and new safely precautions as well. >> and his new pandemic rules

for the summer an op-ed piece on the wall street journal they're pretty ugly. down 5:330 by the time we come down from baek, we're down less than this. ♪ ♪ yeah ♪ ♪ y-yeah ♪ ♪ yeah ♪ hey, hey

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that's according to israeli news website moderna is planning to begin final stage of testing in july we are having discussions with multiple governments around the world and are not able to comment on these understandable that governments around the world are looking to try to secure any potential vaccines that might be working and some of these trials they can develop 500 million to a billion of these vaccines a year and that does raise the question of who gives the vaccines and moderna has some of these done and trying to develop this i don't know what countries they are in negotiations with but this is going to question who is going to get the vaccines and

how do we distribute them and try to figure that out >> i'd like to work with that for starters because not every country is obviously near others and covid numbers have been picking up and he said it's time for health officials to focus on building up the confidence and getting up at three every day and it's going to be tough, doctor, but i feel like it joining us with more, he served on the boards of alumina and pfizer you'll sign on that would be a good problem to have wouldn't it then we'll figure out where the most pressing needs are globally, right doctor >> it's going to take time to

ramp up that supply and not have a billion doses overnight. they're doing advanced manufacturing of the vaccines now. they're not controlling their manufacturing process but hopefully as they make the transition from the research stage manufacturing to commercial stage manufacturing they can do it seamlessly and have the supply on hand. but one of the things we ran into a hiccup. it's about two months. >> your latest op-ed just trying to summarize that if i had to just in a coup of sentences summarize your point i guess it's that the public really before the government gave a lot of guide lines, the public had pulled in and basically had gone

out and a lot of states aren't ready to open upright now in terms of federal guidelines and they are anyway and that's partly from the public as well it's not a second wave that we're seeing in your view. and how we're trying to do this and it's not going to be perfect. it's going to be very uneven. >> the point is that there's a perception at the government shutdown in the country and then the government reopened the country and what happened was people shutdown the country and then people reopened the country and they came in with rules and we reached 3,000 deaths a day. people are starting to close down businesses. the nba shutdown the nba and it shocked people but a lot of businesses were following suit at the time. and they formalize what was underway and we reopen against

the backdrop of more spread than what was described in a lot of the reopening plans but people were getting tired of the shutdowns. and we need to have that and people engage in a wide scale. it can cut transitions as virus. and don't engage in him. and people don't engage on him on their own we seem to be complacent with 20,000 cases a day that's a lot of infection. this is going to become the new norm this kind of rolling outbreak. >> what can we do about it why should we not be more concerned about arizona or hospitals being packed to the limit in some of these areas

we're seeing hospitalization and icu go up quite a bit. you have always been kind of calm about it. where should we be on how concerned we should be about this >> probably not is the answer so we need to be very concerned about it they have more testing in place. you have a better sense of what the overall disease burden in these communities are. california has 3,700 cases and a percent of the cases in los angeles and where the outbreak is. this could get out of control and the cities need to do. it's good contract pacing and not to find every individual that's infecting and find the

sources and take mitigation steps. we're not going to be able to shutdown the country again this fall we need to try to isolate the sources of the outbreaks and if we can't do that these will get out of control i think that you'll see arizona potentially take control away from the contact tracing work. they need to be doing good contact tracing work. >> in lieu of the conversation moments before the past commercial break about offering bonuses to employees to come back to work there's a lot of people that think that we need to get people back to work and incentivize them to get people back to work and on the other side there's people looking at states like arizona or frankly even in new york where some of the safety

procedures at ware houses and restaurants and other places of employment are necessarily practicing the proper safety precautions. i was walking around new york city on friday an even new york city police aren't wearing masks so the question is what is the right approach to this and whether incentives as i said there was an article that called these incentives bonuses and so how do you instill that confidence in the public and in the employment base. >> we need to get people back to work and employers have a big role to play here in trying to prevent spread and not just at work and a lot of parts of the country that were they ever heavily effected by this if you look at texas, florida, south carolina, north carolina and the places where you're seeing surges now action not

epidemics and maybe not true outbreaks but rises infections and surges in infection. these are off of a steady baseline and it's not like it came down and wept back up and now they're coming back up and they never really crushed their infection like the tri-state region did those regions of the country people were never quite as infected by the coronavirus so you're seeing less persuasive behavior in the parts of the country around measures of precaution that right here we take for granted when i go out in connecticut and i see a lot of people wearing masks. i bet that you wouldn't see that in south carolina, north carolina, arizona, texas, where people just weren't as impacted by this. we need to make these procedures and these practices more uniform. businesses can play a really strong role in doing that. >> can we go back to the moderna news the idea that lots of countries

are trying to negotiate with moderna. and how do we determine and how do you get some companies that are u.s. based companies before developing these vaccines. how will they put the united states in stacking order with other countries and then is it only going to be the developed countries that actually get to buy any of the vaccines at first? >> i'm quite certain the u.s. already locked up a certain amount of supply from all of the manufacturers andwe might not be privy to the details and the negotiations underway

i'm sure that it's going to be allocated around some basis and just through private contracts the companies strike on their own. they need to be mindful of making sure that they distribute this as he quequitably as possi. make no mistake. they'll make sure that they have supplies sufficient to take care of their needs before this gets shipped around that's exactly what is happening in the past. call it what you will. countries held on to enough vaccine supplies. >> we have to go. >> go ahead becky. >> just a quick follow up, how much of the stuff is being manufactured in the united

states the expectation that they won't be able to ship this back from in from other countries it's not the manufacturing capacity here in the us. but they're doing that and i'm going to ask you about china they're going to pass this or they have to work as well in beijing. >> they certainly crush their virus. they come this fall. and situations where us. people, americans can't travel abroad where other companies manage to crush their virus aren't going to allow americans to travel to the country. >> all right thanks appreciate it. >> andrew. >> a lot more coming up on squawk box this morning. talks to restart baseball

falling through. the possibility of a baseball season this year squawk returns right after this. (vo) at audi, we design cars that exhilarate with versatility, whether on the track, or the everyday drive. today, that philosophy extends to how we connect with you. we call it, audi at your door. whether a remote test drive, shopping, trade-in, or even service pickup, audi at your door can do this and more at participating dealers. the premium audi dealership experience, on your terms. audi at your door.

yeah, everything is runningis smoothly with the now platform. (bling) see, incident resolved. how did you... gotta enjoy the small wins. you keep being you, derek. keep being you. can i find an investment firm with a truly long-term view 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.

baseball, negotiations grinding to a halt, the league and players association have been unable to reach an agreement on how to share the costs of playing a season without revenue from fans. players association said saturday it would no longer discuss a restart plan after it rejected a proposal for them to make no more than 37% of the salary for playing 44% of a season and on the march agreement that scenario would lead to a season of 50 games three times that >> you could play baseball

playing nba 2-k. that's maybe the future. i don't know, i don't know what to think >> you just need a few more players. >> you have room to go outside and play a small team a -- not a todler team they would be upset. >> we could build a small team out here. >> i was up in connecticut and you weren't around on friday and you were down here in new york city? you came down here, you ventured forg forth i did. >> did you look like sleeper did you just have -- you could just see out of your -- you came into the city. >> no, but i'll tell you though,

i will say this, and i know we have to go to commercial break, 50% of the people were masked but i was surprised at how many people didn't and the nypd not wearing masks was interesting. some stores were and that's why -- then you heard people -- i heard an employee at starbucks complaining about it so that's why i was starting to think about how some of these things -- >> let me ask you, we drive around and stuff and we have seen places. there's large open areas out in suburban new jersey where you don't really run into anyone else and there are families of three people that are totally alone walking along with a mask and that i didn't understand is that just -- no one is near them and there's three of them walking with a mask. what is that, andrew is that the way we should just to get used to it or something >> no, that makes no sense to me. >> if you have little kids, it's hard to say when you have to

wear them and when you don't and trust me little kids don't like wearing masks. it's not easy and my 3-year-old doesn't even like us wearing masks. she tries to rip them off everybody's faces. it could be a situation where you get used to wearing a helmet on your bike you have to make sure that you wear it every single time. >> so even though you're not asserting a purpose at that time you just wear it to wear it. >> what i'm more surprised by is when i see people in their cars driving by that are wearing them by themselves in the car. >> right >> right. >> yeah. >> masks like everything else. >> it's a crazy world. >> it is a crazy world and by the way also when it's hot outside wearing the mask is tough. >> and i told you that i sneezed in it a few times.

>> by the way, that's what we need everybody needs to we all need to figure out a way to get n-95s to everybody and not just medical professionals we're trying to save them for the medical professionals. the whole game would be completely different because my mask is protecting you and it protects you plus the others. >> i didn't even know we had these. remember they sent us like a -- september us like the box full of post its and this was three years ago. and my wife said i think there may be -- and there were >> no, no, no. >> i do feel like it i got the cadillac of maxs. >> you got the right mask. >> if everybody -- if this country invested in n-95 masks this whole thing may be a different place. by the way, not my view that's the view of those that have

written a lot about the value of the n-9 amma5 masks. futures point to a sharp loss at the open take a look at the move lower in the airline stocks this morning. you're looking at each of the major airlines down more than 35% for the year we're back after this. 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...

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market volatility has returned and the nasdaq hit 10,000 before we saw the big sell off at the end of the week. joining us right now for a look at the fixed income market, chief fixed income strategy at raymond james and with the equity perspective we have the cio for wealth investment management at wells fargo and let me start with you this morning. looking at the numbers this morning the dow is now indicated down 40 points after the huge decline we saw at the end of last week. did we get too far on the upside with this. is there too much of a pull back when we're still trying to blindly feel our way around.

>> we were almost 75% into a retracement from the march 23rd lows which is extremely high on a retracement. we did break the short-term 20 day moving average at the end of last week. we'll go through the 200 day moving average which is key support level and if we get down to around 2910 that's the 50 day moving average so you'd have the trifecta of breaking the 20 day and 50 day and 200 day simultaneous lit which would put down side to the equity markets in the near term there's probably value here for investors and we may be sideways trending here for awhile we have come a long way in a short period of time so investors have to be realistic about how far the markets can be traced in such a short period of time >> let's talk about what's happening in fixed income too.

get all the way back up to 0.9%. now it's back down to 0.6% something. again, i guess this is the same story that's kind of playing it's way out here, trying to figure out what's happening in the economy. how much damage is going to be done and then on top of that trying to figure out if there are continuing cases that are going to spread this wave that we thought maybe we had under control. >> you're right. becky, actually, two distinct events last week and we talked about it a lot one was their call for not even thinking about raising rates until 2023 and the rise in covid 19 cases as the u.s. economy reopened one thing that i will point out is while the equity volatility was quite high, actually bond volatility went down last week and i think that is the treasury market in particular saying hey this recovery is going to take longer than people think it's also a credit to the fed and the treasury for what they did back in march. and settle the credit markets

down we'll take out the lows in march at 57 basis points and we're going to hang around this mid 60s level and if things go well we can push toward 1% but we're in a reactive period from the treasury market. especially far out on the curve. >> kevin how come some companies are now issuing debt when they might be able to get a better deal in the stock market at this point. particularly with the retail investors coming in and willing to bet up some of the stocks that would look like they're ba bankrupt otherwise. >> there is a great demand for company credit in particular and the ability for these companies to tap the capital markets comes and goes so i think that they're really taking advantage of both retiring older higher yielding

debt with the demand factor. some of these are 5 to 6 to 1. and they're rebuilding their balance sheets through the debt market and the equity market you have to look at the market and the feeling of the market and the tone of the market and whether the investor appetite is at the really low yields and we haven't seen it in awhile. it was still cheaper financing than at the beginning of the year for a lot of the economies. should the economy recover sooner and should interest rates go up or their ability to tap the capital markets runs clean. >> so what would you tell people

to do would you tell people to buy here and what numbers would you tell them to watch the coronavirus numbers or unemployment numbers >> the economic data has gotten we think much better just last week we saw mortgage apps come up almost 0% so some data is improving and what we want is in the large cap and mid cap sections of the market we would still fade the small cap emerging markets and international development. we just don't think that the fundamentals were there at this

particular point so you want to be up in quality we still favor technology, health care, discretionary and and services as the best place to allocate new capital. >> thank you for joining us this morning. it's good to see you. >> thank you. >> coming up, futures indicated lower again this morning some of the dow names that are leading the way and boeing is down 5.5% and that always adds quite a few points the sell off but also down more than 2%. a reminder you can watch or listen to us live any time on the cnbc app as we head to break here's a look at some scenes from the past few days as states reopen for business across america.

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welcome back let's take a look at u.s. equity futures. we're in the red this morning on this monday morning. 666 points down on the dow nasdaq looking to open up 170 points s&p 500 looking to open 66 or 67 points off let's show you where crude stands at this morning off about 2% this morning. 3557 if you want buy it by the barrel national average rose more than 10 cents over the past two weeks to $2.15 per gallon. we have a lot more coming up on squawk box this morning. we'll talk with the co-founder of q health about his covid-19 test receiving emergency authorization from the fda and the time line for when that test might be ready for homes and schools across the country

. welcome back to "squawk box" this morning health care company q health receiving emergency authorization from the fda joining us is au katak founder and ceo of q health. i should say congratulations for getting this approval to do this >> good morning. >> tell us about the product it's a point of care diagnostic. seems to do it very quickly. you can get an answer in 25 minutes. how does it work >> our products, i actually have it here if you don't mind. >> show it to us. >> this is the cue meter yeah the covid-19 test cartridge and

what you do to operate it is you insert the cartridge into the reader, then you use the provided nasal swop and you take a sample like this and then you insert the swab into the cartridge and the test starts automatically. then the results are delivered in about 25 minutes to a mobile device once you're done, you take the cartridge and then you can dispose of it because it's actually contained and sealed. >> so let me just ask you about this currently you need to do this though with a medical professional so i know the long-term ambition is to have this product either at a home or an office, but how would this work in the meantime? >> so in the meantime our authorization allows any health care practitioner, whether it's

a nurse or doctor without any special training, to use this product in any setting so that means that, for example, if we're looking at get back to work, businesses could pair with health care organizations and do on site molecular testing using our product to get results very quickly. so the main thing here is we don't want to wait nobody wants to wait three to five days for a result, but at the same time they want a test that they can use easily and also have the data in the mobile device is a significant advantage because it allows for all sorts of additional things like tracking hot spots and also being able to monitor people on a regular basis. >> in terms of thetechnology that you're using, what's the accuracy level we've looked and heard about, for example, the abbott test there have been questions about whether it's any more than 70 or 80% relabel and obviously in this environment people want as close to 100% as humanly

possible >> yeah. one of the big questions in diagnostics is what is your sensitivity and the false negative rate. what we've done with cue, it's certainly portable looks easy to use. what's the catch we can detect a very low level of virus so even 20 copies of the viral genome we can detect, which is a very low level we've done a lot of comparisons to other tests -- laboratory tests and we compare very favorably. so our sensitivity is really strong and that's where your false negative rate would come from so we feel really good about that >> cost of the reader and cost of each test if i was a business and i wanted to put this and implement this immediately, what would this cost me and how quickly would i be able to get access to this

test >> so, you know, accessibility is very important to us. you don't need a $3 million lab and a specialized personnel. you'd be able to run this test by just having -- purchasing this device, which is going to be a few hundred dollars, and then the cartridges, which will be in the tens of dollars just like the other tests that are reimbursed by medicare so you could buy a few of these in certain cases or one, it's up to you, but the main idea is that we want to make it very accessible and a lot of the instrumentation for traditional laboratory infrastructure is quite expensive and we want to make this more accessible. >> are you taking orders for this product right now >> we have an early access program that we're working on and timelizing the details on, and we expect to ship in a few

wee weeks. >> and then just so i understand because i saw you putting the swab up your nose. how far up do you have to go we've obviously seen other tests where you've got to go much farther back >> yeah. i mean, the reality is that there's home collection kits and there's other tests that actually go about an inch into the nose and that's because the virus is there there's been studies that prove that so with a sufficiently sensitive test like ours you can go one inch into the nose and collect a good sample that if you have sars, covid 2 you can pick it up from an accessibility perspective and being able to use it in more settings, that's an important factor. we really wanted to make sure that was a good sample site and we're lucky that the physiology

and science support that. >> okay. we appreciate you joining us this morning wish you lots of luck with this and getting it out to as many people as you can. appreciate it. thanks so much >> thank you >> you bet becky? andrew, thank you. we've been watching the market pretty closely and in fact over the last half hour things have gotten worse let's take a look. we've been digging into more of the selloff that's taking place this morning right now the dow futures are down by 690 points a moment ago they were down 790 points when we started at 6 a.m., futures were down by 550 at 3 a.m. they were down by 1,000 points we are continuing to watch as the market digests the number of cases, as the economy opens. the dow futures indicated down by 627 points. take a look at how they've moved overnight. some good moves this morning as we head to break, names with

big china exposure are getting hit particularly hard. you are watching "squawk box" right ren bche ocn an investmenm with a truly long-term view 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.

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a selloff at the start of the week futures sharply lower and markets on edge. we will get you ready for what will likely be a volatile day in stocks. record hospitalizations and new hot spots in america as beijing locks down a market after a burst of new irch effect shuns there. we will hear from dr. sam wattzel. and as theme parks reopen, we'll get an outlook the second hour of "squawk box" begins right now. good morning welcome back to "squawk box" right here on cnbc with becky quick and joe kernen u.s. equity futures, we're in the red this morning it has gotten worse over the past hour. dow looks like it will open off.

s&p looking to open off 70 points nasdaq looking to open 175 points off investors are grappling with signs that the outbreak of the coronavirus is here and the possibility of a surge and shutting down businesses perhaps in the future. >> we're not going to be able to shut down the country again this summer we're probably not going to be able to shut down the country again this fall so we're going to need to isolate the sources of this and if we can't do that, these will get out of control. i think arizona, you're going to cierre zone na take control away from the counties for concentration tracing. these states need to be doing good concentration tracing

>> joining us is douglas sefi and mike santoli and a huge, huge contributor i think to cnbc in so many ways so often let's start with sarat sarat, you make the point, you said stay the course we've had a pretty good v-shaped recovery in a lot of stocks. at this point you would be selective about which stocks you're owning and you would actually add to those positions if there was weakness, is that basically the thrust of your thinking and which stocks >> that is, joe. i think the economy is going to reflect the data, whatever we're getting right now. when you look at the fits and starts, i do like some of the companies out there that you mentioned. chevron, general motors are companies we're adding to.

they're down over 20% for the year this is going to be more about the duration these companies are going to be solvent. they're going to be fine i would add to some of the large cap banks, jpmorgan, bank of america, morgan stanley. on selloffs like we get, the high quality companies that we added to in the early part of the selloff, you can go to the lowe's of the world, the disney's of the world. i think the companies that have the balance sheets that are going to get through the fits and starts, the data is not going to be even so the stock market is going to follow that. we think going forward these prices you're getting today at some of these really high quality franchises you're not going to get in a year or so maybe you buy them more expensive today. cheaper a week ago i would not get aggressive here and take all of the excess cash you have if you are under allocated, it is time to start allocating and

wait for a few more weeks to get another chance >> mike, we were down 5 and change last week percent the week before we were up 6.8%. that's going to cancel each other out. do you believe we were at 3200 on the s&p at one point? that's the bullish target. >> right. >> you're out of your mind we actually got there. it was amazing for anyone to watch. last week we had katie stockton on, a technician on friday she said while she pointed out that short, sharp corrections like we saw that 17, 1800 points, sometimes that's characteristic of a continuing up trend but she said more work needed to be done. she thought that could be below 2800 but that still leaves another 200 points theoretically.

>> reporter: the way it looks to be opening today, it would get it to back to where it was on memorial day 3232 was the high. easy to remember now all you've done is skim away the last few weeks of up side push so i do think that makes sense the power of the rally, unprecedented over 50 days in terms of the magnitude of it, the persistence of it. a lot of the technical breadth readings people are giving the market the benefit of that doubt. historically if you look months out, that tends to have good implications in the short term, even if you look at the massive rallies off of very, very important lows like in march of '09 or 1982, we were ahead of those. therefore, you are kind of overdue for something. at the same time i think we got to a point where one of the most bullish things you could have said about this rally on the way up, it was hated people were fighting it.

sentiment was very cautious and i think that became less and less true as you got a few weeks in other thing is we were in this sweet spot where even the kind of negative case about the implications of new infections, even the fiscal cliff, so to speak, running out of fiscal support july 31st, it was so far away that it didn't matter now it matters psychologically if not substantively now it makes sense to be doing what we're doing. it's going to feel fragile if we get down to 2800, people are not going to think it's going to stop there. it will go much lower. that will be the game for now. >> mike, there's a piece in the journal about skeptics that have been really frustrated by this >> yeah. >> they're sticking to their guns the journal does point out that some of these same skeptics for 11 years, they were skeptical about the stock market >> right. >> one of these days these guys are going to be right though, don't you think? >> sure. >> like a clock?

>> yes there's no doubt about that. last week, you know this the people who we talk about a lot who had been skeptical of the rally a couple of months ago gave mia culpas. it follows that kind of psychology, the market doing the thing that frustrates people. >> sarat, do you have comments on that? they build up a lot of -- they cure the come place sense be si. >> joe, a few points on this one. this has been the most hated stock market in 11 years i look at what their motives are, incentives are. if you are a long term investor, history has been on your side. yes, we've had these bumpy roads. you have to find the time to invest it's the longevity in the stock market that you'll do well over

time in today's market, you will get a lot of people saying, we're going back to 2500 we're going to break through you have to look at the breadth of this market we had a good amount of stocks that had not done welcome back up we need some of these goat stocks to sell off that's when you see some real opportunity as well. if it's only the value stocks that are going down but not the rest that's not going to be a true indication of the market the market needs to come down with the five, six stocks that are holding the market when you see that opportunity, i think that will be our next leg up that will take a little more time as we get more news there are so many haters out there in the market, if you are a long-term investor, i think picking your stocks will be rewarded in the future

>> what stocks do you think? is it a challenge getting businesses open to where the number of customers coming in or is it the fed has been so accommodative and central bankers around the world, is that why we're this high what's really dictating which way we go? >> well, i definitely think we have the fed put balance sheet of companies that are needed are being helped. indicators investors are looking for, the big one is unemployment hopefully the data continues in the second derivative of the slope up if that comes across, i think the market will start leading. then we know especially in our economy here where 70% of it is the consumer, as more people are employed, more people come off of unemployment, to your point,

as more companies open up, be it industrial, retail, restaurants but then you're going to get more money into the system. >> sarat, thanks mike santoli, see you soon. >> thank you. beijing racing to control a new coronavirus outbreak and taking lockdown measures we're going to get an update after the break. before we go, let's get a check on the 345rk9s we're down 700 again on the dow. "squk x"omg ghbaawbo cinrit ck you say that customers make their own rules.

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welcome back, everybody. china having its own spike in cases. eunice yoon joins us it's good to see you >> reporter: it's great to see you too, becky beijing is in what it's described as war time mode in order to try to stamp out possible resurgence of the coronavirus. 79 new cases were confirmed and linked to a wholesale food market which is very important to this city since then beijing has shut down that market, another schools in the area as well as sports venues and the capital has put 40,000 residents on lockdown and authorities have tested 76,000 people in the city

so far and have detected that at least half of the capital's districts here now have confirmed cases. so beijing's cdc has said that as for the origin of this outbreak, it is under investigation but the genome sequencing suggests that the strain is of european direction. that's what the officials said the preliminary judgment is that it came from over seas state media has been quoting a very top market official as saying that the virus was detected on a chopping board at the market that had imported salmon the impact of that was swift the stores here as well as delivery apps stopped selling salmon today suppliers in europe said the market for imported fitch in china is now closed for them so there's definitely been a

very strong impact china will be thinking of its own economic impact. the may data came out. even though it showed there was a recovery, it wasn't a very strong recovery. guys. >> eunice, that makes zero sense. if you're shipping something back overseas, we've all been under the understanding that if something sits for long enough, a few days, it's not going to still be containing coronavirus that was picked up somewhere else >> reporter: yeah. >> it leads you to think there's finger pointing taking place here then the question is, what's the next step in do they close down all imports and say it is because they are concerned about coronavirus? >> reporter: exactly i had the same reaction when i saw that because i think that if it does travel on imported fish, then it raises a whole lot of questions about the supply chain and what we've already heard in terms of the finger pointing, yup, that's also a big question because the authorities later

said that they took over 5,000 samples from that market and that they found the virus on at least 450 of the samples so a lot of different locations, not just the one with the imported salmon. at the same time, it's the imported salmon that's the one that is being played up right now. >> if that's the case none of us can ever eat anything again. okay thank you very much. we will check in with you again very soon. sorry to hear about the continuing cases there and we'll check back with you to see how things are happening meantime, volatility ticking up yet again and losses building on last week's selloff the impact of the virus. resurgence in some states could hit the venture capital funding market for the next few quarters joining us is frederick gross. the founder of blck venture capital and principal at storm

ventures good morning to you. appreciate you joining us. we've been talking a lot about the volatility in the markets. clearly the private markets key off the public markets i'm curious both what you're seeing in your own portfolio companies in terms of how you're looking at the economy but also how you're looking at valuations right now. >> first of all, thank you so much for having me this morning. there's no doubt that the macro economic conditions and coronavirus are creating an environment of cautious optimism within investors and similarly within our portfolio first of all, this is an environment where cash is king and extending and making sure that you have at least one year's worth of cash runway is sort of a fundamental that most investors are focusing on within their portfolio. that's definitely been true for us look, we are beginning to see some downward pressures on multiples. for some investors, i think many are seeing this as an opportunity or environment where

you have a reversion back to some normal because we've been in that environment that had been frothy with multiples being faced off of you future terminals. we can see it going from 10 x down to 8or 6. those companies that are active in the tech or leisure verticals, they're seeing even a harder time right now in this environment. >> so do you imagine over the next several quarters you're going to be investing in companies that are either challenged -- i mean, historically the venture business has not been about turnarounds, so to speak, but i wonder if this becomes that space. >> right no, it's a great point i see this current environment as an opportunity for founders in companies to really double down and focus on engineering and product and find stronger product market fits.

this is an opportunity for those companies that are already doing well or has been -- you know, has some sort of lead already in the market to continue to build on that league for those companies that are seeing a lot of challenges right now in a turn around environment. >> i know you've invested in a lot of sas companies over time when you look at the business, the fundamentals of your portfolio, i know you were talking about wanting portfolio companies to need cash for the next year. do you look at the current business and think that this is challenged it's not challenged? what are you seeing? >> yeah. look, we're definitely seeing changes, right we're seeing declines in sort of net new revenues coming into those businesses that's creating a whole sort of water fall effect. and so we're in this period

where we're trying to ensure that those businesses become more efficient fundamentally every dollar being utilized and burned is driving hopefully more positive net new revenues into that business. all of the fundamental assumptions that went into the business in have all been sort of relooked at and all of those assumptions redone in this environment. the reality is we're going to continue to see top line revenues struggle throughout this quarter and next quarter. it's not all doom and gloom. one of the things we are noticing is that show rates to demos, top of the funnel metrics are starting to look more positive in q2 as opposed to where they were looking february and march of this year that's creating optimism that businesses are still open. certainly if you're selling into tech right now, i think we're still seeing good opportunities to provide value in

organizations. what about an exit what do you think of the ipo market now mind you, you'd think the ipo market would be shut but at the same time you'd look at hertz and say how is it possible that these people are selling a billion dollars of equity? >> there are certainly some very interesting counter intuitive elements happening here. look, i think if you're a best in class business, a market leader, a company like in our portfolio talk desk, you'll have an opportunity still to exit and hit the public markets that being said, i think it's pretty tough for most businesses to assume that they're going to be hesitation until we see the macro positions. >> thank you for joining us. hope to continue this conversation with you in the future thanks again >> thanks for having me. coming up, cases of

coronavirus on the rise. markets are reacting we're going to speak to dr. samuel waksal, founder of kadmon pharmaceuticals. check out the shares of moderna. a report says israel's in advance talks to buy some of moderna's coronavirus vaccine. moderna is set to begin the final testing in july. "squawk box" coming right back when you take align,

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some of the names that are adding to that pressure. first off, take a look at boeing it is leading the dow industrials lower. volatile stock trading down $11 to 178. norwegian cruise lines is "the biggest loser" in the s&p 500. this has been one of those volatile stocks. the cruise lines have been under so much pressure people coming back this is one that was very heavily traded now down 10.8% this morning. decline to $18.28. then there's j.p. morgan chase which is leading the financials lower. this has been one of the groups that has come under pressure as people worry about the zero interest rates and the potential for bad loans in the economy jpmorgan down by 3.8%. if you take a look at the broader market, the futures ahead of the open, as we mentioned under pressure

dow futures down by 620 points earlier this morning we started down about 550 we have seen it down by as much as 1,000 points. just about 1,000 points at 3 a.m. this morning. we will continue to see what happens as we get closer to the opening bell, but obviously this builds on last week's losses 'lbeacwi me information right after this you should be mad at forced camaraderie. and you should be mad at tech that makes things worse. but you're not mad, because you have e*trade, who's tech makes life easier by automatically adding technical patterns on charts and helping you understand what they mean. don't get mad. get e*trade's simplified technical analysis.

meg. >> hey, andrew we did see sort of a

continuation of the trends we started to monitor last week over the weekend overall the seven day average of new cases in the u.s. is basically flat we're adding about 21,000 new cases every day. we reported 21,000 yesterday down from 26 thousand. the northeast obviously on a huge downtrend the midwest also coming down but the south and the west coming up in really concerning ways. of course there are questions about whether increased testing is driving this. increasingly experts are saying no there is increased spread. you can look at hospitalizations data to tell you that as well. in texas numbers are of particular concern you can see them spiking higher up to 22.87 currently hospitalized in the state of texas. arizona seeing the concerning upparticular at 1500

florida doesn't report hospitalizations but you can see the cases there are spiking higher and that's as the test positive rate there has been increasing since may 17th. so they are doing a lot of testing but they're also catching more infections and more are spreading in the community experts say. in terms of hot spots, this is from evercore isi. the first is phoenix seeing cases double in two weeks. tampa in 17 days charlotte, north carolina. austin, texas, and thein sein tral washington is seeing concerning growth, something that their governor actually flagged over the weekend you are starting to hear from local governments talking about pausing their reopening plans if these concerning trends continue joe? >> thank you, meg. some states, as meg just illustrated, seeing an uptick in daily covid-19 cases as the reopening of the economy

continues. joining us to discuss the data is dr. sam waksel. i'm wondering, sam, whether your view is evolving with the latest data i think you've made the case to me in the past that this is a very nasty disease, but similar in many ways to a very bad flu or maybe ten times worse than a bad flu but not like maybe requiring a complete shutdown forever, that maybe if we protected vulnerable people it might have been a better way to go i don't know whether you're evolving now seeing these cases spike. where do you stand >> you know, science always evolv evolves, and this is something that's interesting because it's a new emerging virus human beings and the human

immune system has never seen this virus before so it's new and it's teaching us a lot, and it's an intersection between the economy, politics and sociology and science. and i still believe that this is a virus that isn't going to obviously wipe out mankind this is a virus that we've seen affects older people and people who have underlying medical conditions those are the individuals that really have to be protected and we weren't doing enough to protect them in nursing homes, et cetera. what we have learned very importantly is this is a virus that spreads primarily through aerosol. so what's that mean? that means if you wear a mask, you protect the other individuals. and, you know, we even saw that

in this last round of demonstrations only 1.7% of the people in the demonstration were infected. it's because they wore masks so i still believe that society can open things up i do believe that in the near future we have to protect vulnerable populations and if we do that, we can move forward from a sociological and political point of view have human beings go back to work, but we have to remember that what we have learned is that this is a virus that affects the aged and the people with underlying medical conditions. it affects certain groups that way. >> sam, in some of the notes that you sent us you point out

that antibodies and some of the drugs that are being designed as a therapeutic to maybe be used in conjunction with some of the other antivirals, that they may not be as effective because this virus fuses cells together so that it's not -- it doesn't exist as a stand alone virus a lot of times the immune system needs to actually respond to an infected cell. does that make a difference? you say the t cells are as important as b cells in giving immunity what does that mean? >> that's a great question, joe. and it means a lot, at least to me as an immunologist. i look at this and i see the cytomegalovirus, for example, when it infects cells, in order to infect more cells needs to make viral particles jump out and infect the next cell

not so with covid-19 with covid-19 you get almost a fusion of cells by the virus and it moves in between them that way. it means that antibodies won't work nearly as well as t cells, and we know that vaccines for viruses affect both the cellular, the t cell limb of the immune response as well as b cells. b cells are important. they're making neutralizing antibody and that's going to be critical, but it is going to be very critical that we make a t cell response to this virus, and that means that the vaccines that do best at stimulating both will be the winner i believe that j&j is doing a great job at what they're going to do in producing a vaccine to the stable spike protein

they're using an adeno virus to stimulate the t cell as well i think that's going to be a big winner they're going to have a billion doses for us. >> the adenovirus itself, the vector for delivering the spike protein antigen actually causes a t cell response that would be helpful in fighting thecovid, but it's from the adenovirus, that's bizarre, right? >> it's not bizarre. we learned a long time ago that there were different pieces of antigens that stimulated immune response, and here the carrier will do a lot. the same is true for the oxford vaccine with as stra zen nneka. >> it's disappointing for therapeutics. >> therapeutics are a different question i believe that we're trying to repurpose drugs that we've used as antivirals, but we are still working on therapeutics that

will go after this virus i must say that work is going on that's quite exciting. a colleague of mine and a dear friend, dr. tom shank, has discovered that going after cert 2 in host cells will stop coronavirus's ability to propagate so going after the host response may be important going after multiple pieces of the virus the way we did for hiv will be important. and we're going to do all of that science is doing a great job i'm glad that human beings are going to be the recipients of great science that's helping a social, political, dramatic

economic set of events. >> what do we do for the next year >> so i don't believe, joe, that it means the next year so i believe that we're seeing a dramatic decline in the northeast, as meg just pointed out. there are pockets that are opening up china, for the first time, is having a burst of activity, probably due to fish mongers bringing the virus into their capital. it's a dangerous set of events, but you'll see that china's far better at dictating to people that they have to stay in place and not spread the virus if they're infected we have to do that as well one of the things we learned was that in new york city where the virus was spreading dramatically and where deaths occurred, not

only because of the viral infection, but in the beginning we didn't know how to treat patients i believe that it's not going to be a year and i still believe that this economy is going to open up when people feel comfortable that a vaccine is working, which will be in the fourth quarter if j&j's vaccine, if the astrazeneca oxford vaccine, if the rna vaccine, moderna, pfizer begin to show efficacy, we are going to see an economy that reopens, and it should reopen, with the caveat that in tight places you wear a mask to protect the other people the masks are protecting people from giving people the virus >> becky >> hey, dr. waksal, you just

said something about china, which we just heard from eunice yoon that they are blaming the latest outbreak of 80 or so cases related to a market there, they are saying it was imported salmon that was that that seems ridiculous to me. you've said yourself this is probably something that's being transmitted through droplets in the air that come out of our lungs with that. would the idea that some european salmon that was shipped over over that period of time that then infected people there, does that seem crazy to you? >> that seems crazy to me, yeah. and, indeed, what i hear from friends in china is that it was brought in by people in the fish market area. the infection rate of that group of people is about 10% from what my chinese colleagues were telling me and, indeed, it's probably nothing to do with fish

but, rather, with people who were bringing the fish in, were selling the fish the infection came from people, it came from aerosolization. the other types of thinking about it and blaming packaging, blaming the fish is silly. >> so there's reason for hope in your view then, sam, just in terms of even before the science comes through, you see positive signs. what about the outbreaks that we're seeing in some states? we just heard from meg it's not necessarily just increased testing. >> well, it's both we're seeing dramatically increased testing, but more importantly we are seeing in places that are ignoring the fact that people need to be careful about spreading this disease through aerosolization so if people wear masks -- by

the way, in the demonstrations what we saw was that many people were wearing masks and many people were blocking their ability to infect others and what that did is make the increase of cases because of the demonstrations very, very low. and that's going to be true moving forward so people have to understand that when they don't wear a mask, they're not protecting or not doing something that has to do with them -- >> right. >> -- they're protecting the aged and medically -- people who have underlying medical conditions -- >> right. >> -- from getting the virus so if we do that, it's going to change the direction of infectivity. >> i can't believe the w.h.o

doubtful, sam? >> not helpful and they lied >> crazy all right. thank you. we'll see you again hopefully soon, dr. waksal. >> thank you bye-bye, joe, becky, and ndrew >> bye, dr. waksal great to see you when we come back, an outlook of media partners and theme parks. speaking of reopening, outdoor diners reopen this week. josh gotheimmer will be on about that you'll see tech stocks -- well, actually, netflix is trading higher we've been looking for green stocks this morning. facebook is down by 1.7% amazon off by 1.1% apple down by 1.5. alphabet down by 1.6 broader markets down pretty sharply. "squawk box" will be right back.

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take a look at futures in the red. little bit better. not much still up 600 points. maybe it's coming -- as i'm speaking, it's oscillating we'll call it 575 points off right now. s&p 500 off 56 points. nasdaq looking to open down about 131 points maybe 130 points right now do take a look at some of the stay-at-home stocks like zoom. it is up this morning. you're looking at that stock up about close to 2% and then check this out shares of shopify, some news to bring you this morning walmart now deciding to team up with the company to open walmart marketplace to shopify sellers walmart says it will start to integrate new sellers and expects to add 1200 shopify sellers this year. that stock up -- shopify stock

up that is about 4.5%. big news for shopify there meantime, hertz has won approval from a bankruptcy court judge to sell $1 billion in stock shares. car rental company is trying to take advantage of recent rally in a stock as it tries to raise money. hertz shares had jumped as high as $6.25 but came down off the highs in subsequent weeks. as we all know, at least typically in bankruptcy procedure, you know, the equity is worth close to zero so who knows strange times, joe strange times. >> all right andrew, thanks. coming up, entertainment and media stocks in focus as names like disney and comcast reopen theme parks. will flare-ups and outbreaks keep people going. we'll speak to michael about it. and later david gerstenhaber from acorn advisory capital.

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to start watching today. welcome back, everybody. the recent rise in cases in china and some u.s. states may put the brakes on how disney, comcast and other theme park operators go about reopening joining us for more on all of this is michael nathanson. founding partner and senior research analyst at move fett

nathanson. what does that mean in particular ft. meade yeah stocks. >> becky, good morning it under scores our concern that the return to normal at disney and comcast parks is going to take a while when you look at the attendance composition at disney parks, there are all types of people who come some people live in florida, drive up for the day, others drive down and other people fly in from other parts of the country and world. all of those customers pay different money to disney and universal. our feeling is this is going to take longer to return to normal and recovering disney's earnings will take two, three years from where it was in 2019. >> what does that mean in terms of where the stocks are now? are they fairly priced are they anticipating that >> it's interesting. so we downgrade disney in early

may stock had run so much in our mind it kept running. our feeling was that the market had lost track of the time to recovery for disney parks. it's not a next year they're back to normal, it's a multi-year problem we're bullish in comcast they're about cable. as you know, cable -- i'm sorry, broadband is very, very snippy the other question you can ask here, what does this mean for the nba and other sports who want to go to florida and pretty much get into a lockdown mode, finish their seasons down in florida. that's an open question as well after seeing some of the spike in cases the past couple of days >> you know, you said that this is multi-year. >> yes. >> the anticipation, at least the hope is that we were just speaking with the doctor about this, but the anticipation and hope is that you'll get some sort of therapeutics and potentially a vaccine by the fourth quarter of this year,

maybe by early next year you don't think that this changes if there are therapeutics and vaccines that would make people feel more comfortable about traveling or you think it is an economic knockoff that people won't have the money to travel? >> that's a good question. we focused on the economic impact that's the multi--year recovery we were talking about. i am not obviously the health expert and we're assuming there's a vaccine that's going to come. when we look at other recessions, it does take two or three years for people to feel comfortable again economically to go back, right? it's such a -- again, it's different types of consumers, right? the florida drive up customer will come back with an annual pass that's easy. the seven to ten day northern visitor may not have the money, may be holding on to their cash more post slow down.

>> the weird thick is that in the early days consumers have a lot of money to spend, sometimes more money than they might have otherwise because of all of the massive amounts of stimulus that's poured into the market. do you think this dries up people don't have their jobs that's the other wild card here trying to figure out how much the massive amount of stimulus changes this recession and others, too? >> becky, one of the things we're going to talk about before the news of spiking covid was changing consumer behavior we're seeing real growth in s bond services. you've seen growth in netflix, disney+ and all kinds of s bond products what we think is there is a mid shift happening. people are cutting the cord. they're saving money on their bigger cable pack cake and you're seeing much more growth in entertainment spending on s vod, gaming, there's a mixture. you're right

it's not black and white there are parts of the media ecosystem benefitting from this change where dollars are moving into as people cut the cord, it moves more s vod services. >> you cut on disney and what about comcast? and are there other stocks you like >> craig moffett turned more bullish on comcast he's concerned about sky and the media aspects of nbc we like comcast, charter, all things cable because broadband is a part of that. in media and entertainment, we buy on fox fox is cheap we're going to talk about ratings but ratings for fox for news, your ratings, msnbc, fox,

cnn, fox has a play on the nfl the nfl comes back in the fall they don't need to have large stadiums filled the way baseball does nfl could start. fox pretty much call on the nfl. we like fox. then you see that's a relative place to hide and that seems like a pretty good place to keep hiding we're pretty cautious in the media space. we think this recession changes the long-term media landscape. that's the broadband component of that. >> great michael, thank you for your time today. good talking to you. >> thanks, becky see you soon >> you, too. andrew okay thanks, becky. coming up when we return, a new goldman sachs report says mom and pop are beating hedge funds this year. we're going to tell you the names they're buying and what

all of this retail activity means for the market check out futures. we are in the red across the board. triple digits in the red about 600 points off on the dow. when we return, outdoor dining and non-essential retail are set to resume in new jersey today. we're going to talk to congressman josh gotthmeeir on the move "squawk" returns and so much more after this. feels like there's no barriers between departments now. servicenow. the smarter way to workflow.

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♪ ♪ beautiful. good morning stocks pointing to big losses at today's market open. friday's bounce now looking like it's going to carry over into the new trading week this hour we're going to bring you valuable insight from two big market voices. tiger can you be david

gerstenhaber joins us and allianz's mohamed el erian damage of the coronavirus measured down at the street level. we'll get business data from yelp that may shed new light on the pandemic fallout the final hour of "squawk box" begins right now. good morning and welcome back to "squawk box" here on cnbc i'm joe kernen along with becky quick and andrew ross sorkin down 600 points on the dow jones. the s&p indicated down 61. that will put it below 3,000 in percent and nasdaq looking down 140. nasdaq in percentage terms, dow

jones 2.3% s&p down 2%. futures have been volatile throughout the morning we saw triple digit or 1,000 point loss at one point in the dow. now cutting that in half that's a little more than we gained on friday you remember thursday we had the day near 2,000 point loss in the dow. treasury yields have backed up we were threatening 1% we were at .9. now at .669 and the price of oil is threatening to go over $40. 38 and change, 39. that's all the way down to 39. andrew >> okay. anxiety about a resurgence in covid-19 cases putting pressure on the markets this morning as we've been discussing for the past two hours account by reuters showing that states including california, florida, north and south carolina, and arizona all had new records for infections in the past three days.

saturday's 25,000 cases was the most for saturday in over than a month. testing, of course, has increased quite a bit. many point to gatherings as contributing to the recent spike in covid cases yesterday new york's governor andrew cuomo said that their reopenings could be impacted if they don't take steps to curb large gatherings of people the state received 25,000 complaints, many of them on people not social distancing in places like manhattan and the hamptons becky? >> andrew, thanks. earlier in the program we heard from former fda commissioner dr. scott gottleib about the problem with letting case numbers get out of control. >> we're not going to be able to shut down the country again this summer we're probably not going to be able to shut down the country this fall so we're going to need

to isolate the sources of these outbreaks and take targeted steps. if we can't do that, these will get out of control the cities need to be aadept you'll see them take a look at the counties these states need to be doing good contact tracing work to isolate the sources of these outbreaks. >> joinings right now to talk about the balance of reopening safely and getting people back to work is new jersey congressman josh gottheiber. congressman gottleib, it's great to see you thank you for joining us. >> how are you, becky? >> good. good we should point out that there are restrictions still on some of those reopenings. in fact, the governor of moved to sue as bbury park as they allowed to start seating people

indoors again before the state allowed it this is a huge push between trying to figure out what's safe and also trying to figure out how to let businesses get back open and up and running again. where do you come down on this >> it's a very tough balancing act and i think we're doing a good job today by opening phase 2. retail stores will be allowed 50% inside by the non-essential. outdoor seating will happen over the weekend. in new jersey we're down to 300 new cases a day. we've taken a lot of tough steps here we've got to help our local businesses we've got to reopen but do it safely everything we're doing is being watched with new cases the key is, as dr. gottleib said, the key is being vigilant and making sure you watch that balance. we have to realize you have to help our small businesses. people want to get outside, they have to do it social distancing, wearing masks and being smart about it. >> dr. gottleib told us this morning though that don't expect to see places kind of shut down

again. if there is a pickup in cases that happen once more. do you think that's true >> i think it's very tough to shut down the way we did, but i also think we have to watch our hospitals. if our hospitals get overwhelmed, we haveto take steps. that's why as we're seeing in florida and parts of texas, those numbers are getting out of control, it's really important that we do this safely and that we don't get ahead of ourselves. we're talking about it i talked to all the small business owners and we recognize that it's actually why you can't walk away from helping them either, right? and helping on the jobs front because we know as we reopen we're not reopening at the same level we were at if we rush it, people will be sick again and we'll have to shut down again. i think that is the key balance. i believe in new jersey we've done a very good job of that so far. >> congressman, you were somebody who tries to work in a bipartisan way whenever possible i know that's been a huge part of wa you've been involved with, but there are some different

numbers that are being thrown around right now between the democrats and the republicans in terms of what we can anticipate for a fourth package, a fourth stimulus package the administration over the weekend identifying potentially $2 trillion that they'd like to see -- the president would like to see spent that is less than nancy pelosi has talked about but it is more than mitch mcconnell has talked about. what do you think is likely to happen and where would that money be spent >> i do think we're going to find somewhere in between where mitch mcconnell is and what we've passed in the house and what we will get out of the senate the key is you're hearing we've got to get something done. that's where the bipartisan movement is happening. it's also regional, right? you have democrats and republicans being hit so hard saying our states have been devastated financially new jersey we've got a 15 to $20 billion hole i think what will happen is the package in the senate will have -- there's something i've worked on with many others and senator menendez has called the smart fund, senator casady

that's $500 billion to go to places that have been hardest hit. state and local governments. it goes to every level of government local, no size limitations that will help fill this hole. we take care of places that have been hardest hit in this country. the covid storm obviously hit certain parts of america that's where we need to go and help rescue. i think that's what will happen along with some other steps. >> congressman, wanted to ask you about the current state of the ppp program and in particular one issue of disclosure and transparency around what have you heard from the treasury secretary last week that he did not intend to disclose publicly the beneficiaries of the ppp program. there's an argument for that disclosure insofar as taxpayers -- some taxpayers think they have a right to know where their money went there's others who say it creates a competitive disadvantage for small businesses that accepted the money. what do you think? >> i supported the bill in the house which failed a couple of

weeks ago which said that we should have complete transparency this is taxpayer dollars i think people have a right to know where those resources went, but i think we also at the same time voted in more flexibility you don't want to disincentive advise people from taking it we have a deadline of june 30th where people won't be able to take new loans i think we should extend that out. the resources left, you'll have businesses hurting and aren't going to be open at the same capacity or open at all given certain limitations so i think we need transparency but we also need to continue the flexibility with the program >> larry kudlow also talking about the idea that you need to pay people a bonus to get them to go back to work, that some businesses are certainly having a hard time finding enough employees, particularly when they can make more money if they stay out on unemployment that's an idea we had spoken with rob portman, the senator from ohio about earlier, maybe a month or so.

he brought that up on the program. what do you think about that idea, the idea of paying people back to work, trying to incentive advise people to get back out there >> i think you want to make sure you don't disincentive advise people from going to, would. if we ip september advise them, that's fine. this is the balance we're talking about. people won't be able to go back to work, obviously because they can't or even if they wanted to because of pre-existing conditions or other risk factors that prevent them, child care issues, from going back to work. i think we need to not penalize people who are unable. we need to not disincentive advise people from not going back any kind of incentive to get people to go back but not punishing people who literally can't for so many reasons. i really think what you're saying is that. >> congressman, i'm sure we'll be talking with you again soon

it's good to hear that some businesses are able to reopen again in new jersey today. thank you for your time. >> it's great. next time i see you we'll talk about the stimulus side of infrastructure s.a.l.t., all things coming after the next package. >> thank you, we appreciate it. >> thanks, becky. coming up, what you need to noah head of the first trading day of the week with the selloff on the way we've got the markets covered from all angles, first with tiger cub david gerstenhaber and then mohamed el erian weighs in on a new goldman sachs report. we'll tell you their names, what all of this can mean in the trade market futures right now, we are weak weaker down 600 points on the dow you're watching "squawk box" on cnbc check out shopify. walmart teaming up with the company to open wall market marketplace to shopify sellers

walmart says it will integrate new sellers and llwi add 1200 shopify customers this year. we'll be right back. ♪ ♪ ♪ ♪

welcome back to "squawk box" this morning take a look at u.s. equity futures this morning dow off 675 points nasdaq looking to open down as well 160 points off s&p 500 looking down about 68 points one key sector that's been rising and falling with hopes the country can get back to normal soon, the big cruise line operators. take a look at what's happening there. nor wage began, carnival, royal caribbean. carnival and royal up a little bit over 9%. shares of catalin is up that it

entered an agreement with astrazeneca. that stock up 6.5% becky? andrew, thanks in the meantime hertz has won approval from a bankruptcy judge to sell $1 billion in stock. the car rental company is trying to take advantage of a recent rally in its shares as it tries to raise money hertz shares had jumped as high as $6.25 last week but came down off of those highs in subsequent days this morning they're back down to $2.11 andrew we've got some breaking news just crossing right now from general electric phil lebeau has that news for us phil >> reporter: andrew, a change at the top of ge aviation david joyce, long time president and ceo of ge aviation will be stepping down. who's replacing him? it's going to be john slatery who is president and ceo of

ember air. he worked with a leasing company 15 or 20 years ago john slat tery will be the new ceo. david joyce has been ready to retire they are making a switch where he will be in the chairman role and advisory role and john slattery taking over ge aviation one thing i think they are >> i think you're going to say a lot of the same things, david, and that is that the euphoria

associated with reopening and the virus peaking might be premature. the jobs numbers may or may not be truly representative of what's happening a lot of people coming back but not necessarily new jobs spikes in cases. when you're on may 21st we were at 2900. we went up another 10% after you were on you probably watched that now we're likely to get back down where we were when you were on would you just say to people if you're too long, sell right now and lighten up because a lot of the concerns you have back then you're just going to repeat today. i'm just wondering, do you want to just say that, sell your stocks right now because you're going to be able to go back in at a much lower price? >> well, you know, joe, i wanted to make sure i department say all the same things that i said may 21st so -- but in answer to your question directly, yes, i think it's very helpful to have

that valuations are not sustainable at current levels. they will fall particularly as the government stimulus programs wiped down i think valuations are excessive and in particular i think that we will see a little surge in actual activity now as cabin fever gets people out but i think that's short term in nature and over the next couple of months i'll see -- i think we'll see more disappointing data that the market will have to come to terms with. >> right you're incredibly smart. are you coming to us from aspen now? >> i am. aspen, colorado. the sun is just rising at this point. >> i'd probably love to stay where you are now. i'm sure it's magnificent. we know how good you are at doing what you do, but what do you attribute the disconnect to at this point? the feds and bankers stimulating

things or money looking for a place to go that will end eventually all of the things you're bringing up are apparent to people other than just you the market somehow has disconnected based on something. do you think it's sort of an unsustainable ephemeral move higher >> i do. i think there are two key points on stimulus that we need to address. the monetary authorities globally have thrown a tremendous amount at it and there's speculation. i think hertz is maybe the poster child for the speculative activity this is a company that was bankrupt carl icahn sold his shares at 70 cents. he knew what was going on. now they're being allowed to do an issuance of stock because the stock has moved up even though the company is presumably bust that's point one

point two, there's clear evidence in the united states that we over egged things. people are making substantially more money on a short-term basis than they were when they were employed when you look at the most recent personal income and spending data, you had income up the better part of 10% even though those actually working had their wages down over 8% my suspicion is that as we move into the fall, as congress begins to come to terms with how substantial the stimulus was, as they also start to come to terms with the debt burden that this will generate, that the likelihood that these programs will be renewed at full force is likely to decline. so i think that's a problem. the other point that you raised is the unemployment statistics in my mind are a mirage. we added 2.5 million jobs. at the same time those furloughed dropped by 2.7

million jobs almost exactly the same number what was critical to me is these were in leisure, hospitality, retail clearly industries that didn't come back in may because they were closed. we shifted the support of these workers from the government to still the government but funneled through the ppp loans through companies. unless those industries come back, in a few months those jobs are going to disappear along with the income associated with them. >> over time we have seen people who stay long build wealth to 780. i remember when i went into a merrill lynch training class, it went wherever we are right now sooner or later people want to be in probably, david, unless this is really different this time so at what level on the s&p or the dow would you say this is a really good value for people who are in their 30s or 40s and can

hold a long time at what value would you say everything i'm talking about is already in this market where would that be on the s&p for you? >> well, look. the s&p -- my numbers right now is trading at roughly 20 times earnings so if you said let's take 15 or 20% off of that number, you get back to trend valuations that we've seen in the past so to peg a number, if we're down at 2500, 2600 it gets a lot more interesting i recognize that the interest rates are substantially lower than was the case in the past and so you can say the discount factor is different. what are the alternatives. to your point, equities still at this juncture look more interesting than bonds to me because you have that long-term optionality. if you take a ten year government bond, what are you going to make over ten years less than inflation which says you're going to have a loss in real terms so, yes, i think you need to

start buying if the market pulls back not a tremendous amount, but valuations matter. not as a timing tool on a short-term basis, joe, but they do on a medium term basis. when valuations are extended, unless you have a surge in economic growth, i don't mean over the next couple of quarters as we come back, but unless you have a meaningful acceleration in trend growth, just not going to make a lot of money >> right i'm talking about valuations -- i'm talking about in terms of if you wanted to get things cheap, cheaper than they are right now, cheaper than they've been in the last year or so, must be a point at which for long term -- unless you have an alternative wealth builder over the next 5 or 10 years that you think will be superior to equities for the long term. >> and i don't and so to peg it at 2500 or 2600, i'd be buying substantively recognizing that your down side at that point is pretty limited

to answer your question, you didn't really ask it, about when does the economy come back i think 2021 is kind of another lost year. we're not going back to the level of gdp that we experienced at peak in 2019 until probably 2022 so what you're playing for in the near term as opposed to the long term just isn't that great. 2500, 2600 if we got there i'd be buying and i'd be scaling in on the way down to that. not here >> if there were a vaccine towards the end of this year that would be ready for mass distribution in 2021 you still don't think that there's pent up demand that would bring the economy, at least give you green chutes that market would discount and say by mid year 2021 things are going to be much better you don't think that's possible or you do? >> no, i would agree with that the issue of mass distribution, you're informed, not me.

the question is does it actually happen number three, how quickly do people get vaccinated. near term to get people back to work, you're still focused on testing. we don't have heard immunity. i'm not a scientist. you're better on that than me. i think the risk/reward remains compare rativelily unattractive for financial assets. >> thanks for clarifying everything time will tell and we'll have you back we'll update all of your views at that point. thank you. >> thank you, joe. >> becky joe, thanks. when we come back, which business is closed and which ones out there are starting to see glimmers of a comeback we've got some excludsive data from yelp that you need to hear. stay tuned, you are watching "squawk box" on cnbc ♪ ♪

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welcome back to "squawk box. breaking news. june read. all of the manufacturing in new york number around minus 30 much better number down .2 of 1% down .2 of 1%. that is the fourth negative number in a row. in february we were 12.9 obviously that's what we're going to comp to even though the markets are having big responses to nervousness about reopening, the fact is we are reopening and various parts of the country you're going to have to start dealing with some of the issues that many suspected would happen especially as you reopen and we're still in a coronavirus we're not on the back side of it yet. and the markets like last week on the treasury side have become the favorite, the darling of investors again. down 22 basis points and a 30 year bond and it's down another handful today. andrew, back to you. >> rick, thank you hope you had a great weekend

in the meantime, with demand for air travel slowly starting to pick up, some of the planes that have been sitting parked for months are getting back in the air. likely take a while for those flights to become profitable again. want to get back to phil lebeau who joins us now with more on that phil >> reporter: andrew, profitability is a long ways off. these guys are still burning through tens of millions of dollars every day. you need these planes to be at least 75% full where we're break even on a particular flight. they're not at that level yet. when you look at the airlines, you need to keep in mind that they are bringing back these planes now a couple of factors here some of the airlines have said we're going to block that middle seat and as a result we're capping passenger levels at 65 or 66% for a particular flight so as a result when you look at the airlines that are bringing back planes, in the month of june only you have american at 64, delta at 16, frontier bringing back 20 and a lot more on the way in the month of july. all of this is because you've

got more airplane seats that are out there. people as they are starting to fly, the airlines are making more available now it's up 39% according to oag since mid may, but when you look at the level since january, still down 66% so the airlines are nowhere close to getting back to actually making money off of all of the seats possible. that's where they would like to be, the january levels speaking of passenger levels, the tsa out with the data from over the weekend you see that little bit of an uptick there the passenger levels down 81%. we've topped 500,000 passengers with yesterday being the best day at 544,000 take a look at american, delta, united these guys are all down, what, 8 to 9% to 10% in the last week. so they had a rough week big dropoff. little bit of a comeback down 8 to 9% take a look at shares of southwest. oag pointing out that southwest as it has added back flights

pretty judicioujudiciously, it more seats available than any other airline in the world and that's not a surprise given what we've seen in china and southeast asia guys, back to you. >> phil, there is just some news crossing on united i don't know if you've had time to look at this yet, i have. >> i have this is big news in terms of what the airline is going to be doing. the airline has essentially lined up a loan for $5 billion the collateral for that loan, it's gs to be backed by the mileage plus program that's the frequent flyer, the loyalty program. this will help them along with the treasury loan they're applying for have about $17 billion in liquidity by the end of the third quarter that's $5 billion. then another 4.5 billion they expect to get through treasury

that will be backed by slots, gates, routes not by aircraft. between those two, united expects to have about $17 billion in liquidity by the end of third quarter with a cash burn rate coming from $40 million a day in the second quarter to $30 million a day in the third quarter. they are doing this, guys, basically lining up the possibility they'll need more liquidity especially if there's a second wave of covid-19 and there's a contraction in flying in the u.s. and around the world. >> phil, explain how the loyalty program is worth $5 billion because that's really just the information on the passengers, right? those passengers aren't traveling, aren't spending like they used to what is the value there? >> reporter: no. when you're looking at the mileage plus program, $5.3 billion in sales last year, becky. $1.8 billion in ebitda they are monetizing that program by essentially saying, okay, this is going to be backing a

loan facility for $5 billion by the way, they expect that they will keep this open -- >> that was last year. what's -- what's the revenue -- >> what is it for -- >> what's the revenue this year? >> reporter: they did not give that they gave a briefing on that becky, if you look at airline bankruptcies, we've said this going all the way back to 2000 if you look at all of them, what is the holy grail when it comes to bankruptcy that is protected first and foremost before anything else? loyalty program because they are the most valuable asset in many ways that the airlines have, and what united is doing here, we'll see this likely with other airlines as well, is to say, okay, you know what, we will collateralize this this will be the mortgage behind this $5 billion loan we've got 100 million subscribers and you're bringing in more than $5 billion a year in sales, i think that they believe that this is a smart move and i think most people will look at it that way you'll see other airlines do something similar in the future.

>> look, i think it's a smart move for the airlines. my question is, you know, it was worth $5 billion last year, what's it worth this year? show me the numbers this year and do you think it will be back like that next year? maybe. >> reporter: let me ask you this, becky. if you were a mileage plus member, are you canceling that credit card or that program? are you still spending through that credit card are you still spending through that program this is not tied into -- >> no, i wouldn't be spending. here's my thought on that. i think most people that have those credit cards use those credit cards mostly when they travel because there are so many rewards. >> i disagree. i disagree by the way, becky, this is into the tied into the revenue with the credit card, it is tied into the revenue with the program the revenue for the program is certainly going to be impacted by fewer people are flying so your point is correct in terms of what is the value of the program this year. they believe that as more people fly, they'll eventually get back to that $5 billion in sales. but in terms of -- >> that's where the question comes in that's where the question comes in how much is it down this year? how quickly will that return

that's the big question on everything happening with the airlines >> sure. >> how quickly are people going to be flying again. >> right right. look, nobody's expecting profitability by the end of the year, but what they are doing there by lining up the 17 billion in liquidity is making sure they're in position. >> i think it's smart on their part i would question whether the underlying value of the program is still that. i drove by newark airport for the first time on friday, phil, and i was shocked. even though i don't see planes in the air, every time i do it's enough for me to stop and take a look at them i had not driven by any of the airports that was the first one i drove by there wasn't a plane that was landing or taking off. i didn't see any planes at any of the gates it was kind of this awesome reminder of this airport that when i used to drive by it all the time would be completely jammed with the planes lining up to come in >> sure. >> even as you see people starting to come back and 500,000 people driving that is a --

>> reporter: they're a long ways off from where they were free-could free pre-covid-19 there's no doubt the corporate traveler is not coming back any time soon. >> the profitable ones. >> reporter: that's the most profitable more people may want to go to florida. it doesn't matter until you and i are on a trip to dallas or somewhere else >> phil, thank you great to see you. >> reporter: you bet you, too. let's get back to the on the ground impact of the coronavirus. yelp's data science team has been gathering information on business closure since the start of the pandemic using the over 200 million reviews and photos the new data which is exclusive to "squawk box" is helping to reveal more fully the economic impact of this crisis. since march 1st retail represents 23% of all of the business closures on yelp. of those, 27% are indicated as permanent closures restaurants are getting hit hard as 48% indicated they could not come back from this crisis

joining us for more on this data is justin norman is he yelp's vice president of data science we're excited to have you here today because we are having such a hard time trying to use the normal economic data that we follow on a weekly or monthly basis to figure out what's happening in these very unusual times. what you're doing really offers some real time insight into what's on the ground first of all, tell us about how many businesses have actually closed during this >> absolutely. thank you for having me. so as of june 10th, and as you mentioned, we've been capturing this since the beginning of march when the shelter in place orders really came into effect, we've seen more than 143,000 total business closures. and what we're seeing in that data is that over 35% of these are marked as permanent closures by business. which means they are not expecting to reopen according to what they're reflecting on yelp. this is just a reflection of what yelp is able to see a

businesses mark that data on our platform so there actually could be more or hopefully slightly less, but it is a reflection of what we're seeing >> in terms of the breakdown, retail and restaurant we know are a big part of them what percentage do they each make up? >> sure. absolutely as you said before, retail makes about 23% of total businesses closed since march 1st and restaurants are coming in at about 17%. it is really telling that restaurants in particular are 48% of closures are marked as permanent. even though restaurants have a higher degree of closures overall, some markets may have had very little reserve cash as we went into the pandemic and had to close immediately later in may, most recently we're seeing a second wave of closures really come in for restaurants. that's when some restaurants have been able to find a way to

survive for a period of time, ran out of that cash reserve or realized that the secondary mechanisms just weren't enough and are transitioning now. >> we saw on the screen the idea that beauty salons and others had been closed for a long time, too. what other businesses have been affected >> absolutely. beauty actually makes up about 13% of the total businesses closed and is a smaller overall percentage of businesses, but we are seeing something interesting in beauty, there aren't as many permanent closures and aren't as many total closures. 18% of the 13% from marked as permanent, what that indicates is there are likely other mechanisms of beauty businesses to deliver their services to their consumers. we saw that youtube is being utilized to give hair tutorials. a lot of makeup providers are sending out packages via

delivery to their consumers. they're making a good run to still deliver services and keep revenue up another area is fitness. online fitness has become all the rage during the pandemic many people aretaking part in video. i'm part of that community as a result these gyms and fitness institutions are able to continue to get that recurring revenue over time. and you're seeing really only 5% of businesses that are closed since march 1st are in the fitness industry although there are a lower number of fitness businesses overall on yelp >> justin, do you break this down geographically, the places that are maybe opening up and starting to see a little success? >> sure. we do have that information, although we did not see any strong trends eographically. the data is calculated up until the 10th of june a lot of the shelter in place

orders are now just starting to release especially for businesses that require people to spend time inside, like diner seating in restaurants or fitness organizations. so we haven't seen a lot of changes in that geographically, but we'll definitely keep an eye on it. >> we'd love to have you back and share some of that information with us. we really appreciate your time today, justin. >> absolutely. nice to be here, thank you. >> thank you joe? coming up, a new goldman sachs report says mom and pop investors are beating hedge funds. we're going to tell you what it quk x"om rhtac the market when "sawbo cesig bk. a grandfather of 14.

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welcome back to "squawk box" this morning take a look at futures on this monday morning little less than an hour away from the opening bell. looks like the market would open off 670 points that's the dow s&p 500 off 65 points. nasdaq looking to open down 145

points treasury yields this hour, show you where things stand right now as we flip the board around. what you're looking at there on the 10-year note becky? andrew, thanks when we come back allianz chief economic advisor mohamed el erian on the resurgence of investors and how they are beating some of the big hedge funds. we'll talk hot stocks in demand like hertz, nikola when "squawk box" returns

>> they fell 5.9% down in

february and then retail sales were down 2.8% they're up 3.5% and home sales were better than expected. than in beijing a cluster of coronavirus raising worries of a second outbreak there. 80 new cases have been reported since friday major tried to a produce market on the outskirts of the city. that market has been shut down since saturday and nearby residential areas are on strict lockdown with no one allowed to enter or leave and all food and daily necessities being delivered. authorities are conducting daily temperature checks, as well. disneyland hong kong is set to reopen on thursday. the park has been closed since march 26th new safety precautions, as well. joe? >> becky, let's get to cnbc

headquarters jim cramer joins us now and, jim, an hour doesn't go by where someone doesn't bring up hertz or some of these other companies. the stocks that have moved as sort of an example of froth. and you have been commenting a lot on this sort of new age website-type market activity that we're seeing on robinhood from certain places. i don't need to give anyone any more publicity than that but most of the time, if young people are getting in the markets, you would think maybe it's a good idea that they're cutting their teeth on stocks and its democratizing investing. in this case, do you think all this interest being generated by a couple different people is a bad thing because you're teaching, they're getting taught the wrong lessons and how to invest >> no, i think they're in and i think some people want a binary

thing. they think it's like gambling. the eagles either lose or win against the cowboys. and i think once people are in, they probably do want to learn i'm very pro the movement. if you listen to what phil lebeau just said, hey, wait a second, southwest air has the most and maybe i should buy that one or united or united because they're doing something with their affinity people and the more people understand, the more likely they're here to stay. and i think we should encourage people for investor education. there isn't anybody i know who doesn't want to make money and they want to make money and have an edge. these are people who are not going to the roulette table and they want to go blackjack and i say we help. what are they just going to go to cord cutting places that may not be as good as we are

i think we offer as a network tremendous information big ten. big ten. >> all right my producer is saying, just say it tell so it's barstools sports. you follow what's happening here and it's -- >> there's a couple places i followed dave. i love his deal with penn national and they've done so many, look, they don't have sports when they go back to sports, who knows because i follow david everywhere he's been on my show a couple times. he's just a very smart guy and he's very entertaining and admits that he lost money at the beginning. very open about his wins and losses you could say maybe he's not doing it the right way or maybe we're not doing it the right way. i pass no judgments on people who want to be in, but do better >> it is possible now to lose money in sports, jim

i lost money even though i had xander to win that tournament. he just hit two 35-foot putts and i lost i was going to get 4-1 or 5-1. anyway, so, it's possible to lose doesn't matter >> but think about it. you're a very good golfer and a lot of expertise and you didn't win but i think that anyone who says, well, joe doesn't know what he's doing is a big mistake. let's educate and get people to be helped and everybody does better. >> i agree becky, did you have a comment for jim? >> i was just going to say i watched "daily day trader" at the close on the day the market was down like 1,000 points and i logged in to see him live and the thing i appreciate from him he is open when he loses money and that has probably helped people see from the beginning, too, it's risky. you have to be aware he tells you exactly how much he lost or made on any given day and at least there's some

education in that to see that it's not all up. it's not always easy >> right look dave has a lot of things that are funny that people won't think are funny. what i really like is open hand. wants people to know more. wishes he would know more himself. he's a student of many different things he's, i think he's a brilliant guy. i liked him for years and i can't suddenly stop liking him because he's -- if anything, i can help his people and i think he'd welcome it. no doubt in my mind that he wants everybody to be better >> great glad we got it all out there, jim. appreciate it. we'll see you in a couple minutes. andrew >> okay. meantime, golden sacks out with a new report that feeds into this whole conversation that we have been having about dave mom and dad investors beating hedge funds this year. here to talk about why that is and what does all this retail mean for the market. i'll ask mohammad.

we were just talking about dave and really you could call it a frenzy or call it something else in terms of retail investors i hate that phrase retail investors, but refatail investos getting into the market and doing better than the hedge funds. the question is whether they were right or whether they were wrong and how you want to measure that over time >> yes, thank you for having me. important to have more retail participation in this market based on transparency and information. what they got absolutely right was the rotation trade that were ahead of everybody else. had a rotation from stay at home to reopening stocks from leaders to laggers

the two big questionmarks the volility that introduces hertz up 37% on friday indicated down 23% down today. what do we do with this volatility and second and more importantly, we lost this perfect alignment. up to last week, we had an al n alignment of very supportive central bank policies, health reopenings and very supportive technicals because of the participation of the retail. central banks haven't lost and the healthy reopening and more question marks a lot of focus on the technicals and that is what is going to determine where this market goes in the next week or two. >> the thing i can't figure out and the thing i worry about, i'm a professional worrier i don't want the retail investor who has just gotten into the market to get killed in all of this i worry about that because there are a lot of professionals and i'm not claiming that the professionals know more than

anybody else in this environment, but there's also a lot of work that goes into this and when you see the warren buffets decide to get out of airlines, you could decide that was a terrible trade perhaps in the moment maybe that will be the right trade in the long term we don't know. but these are the types of questions that i think we have to ask ourselves and i'm curious what you think that will mean longer term. >> so, i'm a worrier, too. worry not just about the retail sector abandoning the market and they did so after the global financial crisis but also that the buy in that you get from society into the market-based system gets eroded. and that has bigger implications so, i worry, too the way to answer that is to provide as much information as possible to provide as much transparency as possible so that people understand what sorts of mistakes a s ars are possible but, you're right to worry

but the problem is no easy way to turn this off >> in terms of where we are right now and in terms of the information that's coming in both about additional spread, where you're seeing the market, what you think will happen with additional stimulus, where are you today? in terms of your head on the market >> on the policy side, i'm -- it's pretty clear that the central banks are going to continue to support this market. on the fundamental side, you've got to worry about that dreaded series of ws we come down in the economy and we pick up again and then we get another outbreak and then we come down again and that w is what worries me on the economy but as i said earlier, the short term is going to be the technicals it's this tug of war between retail, very supportive and hopefully stays in and between institutional that's much more

cautious at this point >> okay. mohammad el-erian always great to see you and get your perspective. we have been watching the markets and we are triple digits in the red you see the dow is down about 646 points joe and becky, great show. see you all tomorrow make sure you all join us tomorrow "squawk on the street" begins right now. welcome to "squawk on the street" i'm dan along with jim cramer as you look at futures right now, we are set up for a lower open after those volatile and down daze that ys that we had ts the end of last week significant decline on all the