good morning welcome to "squawk box" on cnbc. i'm becky quick along with joe kernen and andrew ross sorkin. closing in on july, you are right. you know what that means days are getting shorter >> so july is next it could come as early as next week we'll just have to see >> you know what else today is >> i don't we'll dot chair segment. >> it is friday. friday, i'm in love. >> you are still in love with matt >> i am. >> you are too >> so much in love with my family in love with the people i work

with looking at you, sorkin you are on a huge, huge screen you haven't seen that. no one has a tv set. how big is that thing? >> 108 >> can you get one of these. >> a little too close. back it up a little. >> i almost said this morning, futures down this morning after yesterday's -- yesterday's 300-point gain so, okay they are down today. how do you sell this it was weird yesterday, wasn't it all morning long virus and all of this. end of the day, i looked it up up 300 i don't know >> look, the problem is that these swings we are seeing, we've all become kind of unnerved to it that was only after a loss from

the day before we are looking at these up and down swings. the dow right now is still down for the week the nasdaq is indicated up for the week we'll continue to watch that looking at u.s. equity futures the dow was up 300 points and the s&p up 33. nasdaq up 107 points also up about 1.7% this morning, nasdaq is hanging in there up about 6 points and s&p is off just over 3.5 points. yesterday, the 10-year yield fell back below the 0.7% this morning, still at 0.676%. oil prices, which a couple of days ago dropped by 6% down again when we were watching it yesterday closed a little bit higher now up by about 1% back at $39.7.

still below that $40 we had finally pushed above very recently >> what a world. some other top stories to tell you about. we are watching the financials following yesterday's release of those stress tests the fed announcing it would be forcing big banks to suspend their share buy backs and cap dividend payments at levels for the quarter. the banks must also submit their payout plans the fed found several banks could get too chose to minimum capital levels in pandemic amid the slow down. if you remember when jamie diamond wrote that letter talking about the worst case scenarios. we may not be here becaused on what he was saying but the fed maybe taking a sharper view

themselves >> yes i was looking at that. you know what else was interesting for me, i thought of an interview i did last week that the fdic and others remove restrictions for how much money could be set aside for swaps thinking about how minority-owned companies doing all of these interviews. then i thought, maybe this could be a good thing. did you immediately worry about getting into trouble again and not setting enough aside what was your take on that knowing too well mixed views part of me wants to

get that in as soon as possible. less and less money for a rainy day fund that's the balancing theme in my head i took it as a positive. stop the presses i thought maybe we overregulated the first time around and maybe we held stuff back a little bit. just saying it would be better i thought it would be good we need to inspire and fund and support small businesses and entrepreneurs across the board urban areas and everywhere across the board >> they are the ones that will be feeling the most pain they don't have the balance sheets to keep them through this if you can make sure that's where the funding goes, that would be a good thing. >> the fish and rod, not just

the fish the hand up, not the hand out. >> you've been listening to john o'brien. >> i have. i'm getting kudos from my analysis on the calendar that july is next serious on twitter i have a serious point when is july 4 is that on a saturday? >> next saturday >> next saturday technically but friday is the day the markets are closed >> so we are off on the 3rd? what about the employment report when is that >> they just said thursday, it is coming a day early. >> that's what i was hoping for. everybody is waiting to see.

don't you know that number of jobs added i don't believe a lot of numbers and i don't believe a lot of the numbers that would be so difficult with the states. it is impossible to do the real time counting like this. remember when we'd get the gain. where is the margin of error these days >> will you be adding jobs or losing jobs? >> adding or losing? >> i'd say adding probably >> because of what happened last time normally i'd say losing. >> maybe but i think the real number to care about is the end of july or even end of august.

we are still in the world. as a broadcaster you are doing a lousy job of selling that number both of you. >> big number to watch it. i do have a life there are so many things going on and all based on whether we get jobs back. it is nike and the u or the l. last month was such an outliar that i'm interested. my july analysis >> speaking of nike. >> speaking of that's right the swoosh shares of nike i'm also told is a dow component. did you remember that? >> yes, i did. >> they change them too much >> the company posting

unexpected loss. down 3%. the dow component. i said it before i read it hurt by retail store closures amid the pandemic. seeing a 50% drop in shipments online sales were up 75% we'll talk to an analyst who probably had no idea this was coming in the next half hour no, no we have only the best analysts >> look, i think the street may be overreacting a bit. looking at a quarter analysts had no idea would be coming. we knew they were going to get hurt the good news is that they were able to see so much in terms of digital sales. we'll come out and look a little different. businesses will try to take advantage of that. you'll see a shift in winners

and losers strong brands will come out stronger retailers will come out weaker you see this play out. real estate companies will come under pressure as companies say, i don't need this many people to come back. movie theaters will not want to be beholden. we still can't put it elsewhere 90 days. the idea that nike can built a direct to consumer link will help them overtime >> it is starting to look like a swoosh initially, it looked like a v shape. now kind of a hi brid v swoosh

in other corporate news, the ceos of major u.s. airlines are to hold a meeting with vice president pence. talking about european union travel restrictions. temperature checking at the airports and contact tracing unions are asking congress for a $32 billion additional government aid package unions say this is needed to keep jobs through the end of march 2021 as travel demand remains weak a topic we had this week >> flight attendants have to go to work as essential workers our jobs are on the line here. 11 million people count on the airline industry for their jobs. we are talking about unemployment roles increasing. we have job security through the

end of september we need an ex teks of that the federal government has not handled this properly. we'll see mass layoffs in october if this is not extended. >> airline stocks this morning have been under pressure they are down slightly this morning. >> you guys got some other segments we have the chair segment sponsor. >> what we need to do is figure outweighs to get a special chairs background for everybody so we can put ourselves in the same place >> can you do that change your back drop on this break. just check it. becky is changing it >> no, we need to get a

specialized one to make us look like we are all in the same place. >> oh, virtual >> look at becky, i'm getting vertigo. a disco. >> you can move. so sorkin, where is your control? change it. >> dr. gottlieb is coming up this is how a lot of people base their feelings about stocks and prospects based on the coronavirus. take a look at this morning's s&p leaders and laggards stay tuned we are watching "squawk box" on cnbc

if you've had the coronavirus, you've got a lot of fight in you. and you're in a special position to help us fight back. the plasma in your blood can literally save lives. but we need to act fast. please donate plasma now. please donate. donate. donate. donate now. you fought for your life. now let's take the fight to covid-19. go to the fight is in us dot org to find out how to donate.

there are times when our need to connect really matters. to keep customers and employees in the know. to keep business moving. comcast business is prepared for times like these. powered by the nation's largest gig-speed network. to help give you the speed, reliability, and security you need. tools to manage your business from any device, anywhere. and a team of experts - here for you 24/7. we've always believed in the power of working together. that's why, when every connection counts... you can count on us.

florida and texas announcing a pause in reopening plans the cdc says it is possible the number of infections in the u.s. could be 10 times higher than the confirmed case count joining us now dr. scott gottlieb, former fda commissioner and serves on the boards of illumina and pfizer.

even at 10%, that still leaves 90% nonimmune that haven't seen the virus. so 10%, amazing that it is that high and makes the mortality rate look more manageable if that's a word you can use. it doesn't make it look as bad but still leaves a lot of people that would be obviously vulnerable to the virus. >> what he said is we are probably diagnosing one in 10 infections the actual number of americans who have had the coronavirus is between 5% to 8% which is probably right. we've been saying that on the show for weeks now i would say we are diagnosing one in five to 1 in 10 infections right now at the beginning, we were probably diagnosing 1 in 20. the total population i would

guess is around 7% right now it was 5% probably at the end of the peak back in may in cities like new york it might be higher. boston, new orleans, closer to 10%. why is the positive that deaths are down does that mean these are younger people or we are treating them better or using remdesivir or dexamethasone or getting them to the hospital quicker what is the difference there >> the mortality rate is down. we measure

likelihood of dying from covid is down. the average age of a coronavirus patient presenting to the hospital or being diagnosed is much lower than it was the worry would be that we look a lot like iran. they had an epidemic, started to come down, plateaued but then had another spike in infections. in about three to four weeks after that spike, their death rate went back up to where it was. so there was a delay we'll see the death rate go back up hopefully it doesn't go back to the levels it was at you think rightnow, we are diagnosing one in five infections so maybe 150,000 deaths in the united states. reporting about 800 deaths per day. we might be around .5%

>> which is bad. not as bad as 5% >> it is the infection fatality rate not the case fatality rate so it is different >> the governor of texas does not want to backtrack on reopening. we are hearing that texas is backtracking in terms of not doing elective surgery, that is key capacity. that's not really enclosing anything that's just in case the health care system is strained, you are not going to have patients in there with elective procedures that seems different than going back to a prephased one or closing businesses again >> most things are open in texas. they didn't close anything they paused continuing opening sporting vents, bars, libraries, rodeos only at 50%.

they paused there. most things were fully open at 50 to 75%. hair salons, tattoo places are open at 100% with no social distancing requirements. i was surprised by what they did. before they put an extreme burden on health care system they would take some measures to close some of those in the region where this is spreading like houston they told houston hospitals you can't do electric procedures but bars are still open in houston >> still might >> they might but they put a big burden on the health care system i would imagine in the coming days, you'll see doctors express displeasure with that. >> hey, scott. what do we know about where these outbreaks -- where they

are taking place and what's happening? how are we doing with contact tracing? do we know it is the bars or the hair salons? what do we know? >> not much. that's the problem these states aren't doing very good could be tract tracing work they think it is settings where young people are gathering because they are the ones getting infected they've identified the bars. apparently most of the people presenting sick have identified they've been in a bar recently they don't know for sure they just suspect that >> talking about the next two weeks are crucial. you have even mentioned that what p is going to dictate the next two weeks have we taken precautions to

deal are we rolling the dice and just going to see what will happen? >> i think it is the latter, joe. people will be more cautious on their own. people are talking about you should wear a mask or stay at home many will heed that vice texas is testing a lot and turning over cases florida is not florida may be in worse shape. we just don't have a good picture. i would also be worried about south carolina and alabama texas, florida, arizona. >> people are out and about. i see it where i live. i wonder, have we put it to bed here >> we are never going to put this to bed. with he have to get through one

more cycle of this it will take weeks and weeks to get the size of florida and texas. that has taken weeks to build. if we start building, we'll see the consequences of that in four to six weeks >> we have to worry about two weeks and then four to six weeks. >> i think we'll be okay for a little while here. >> all right, doctor andrew coming up, we'll get into chairs maybe figure out some backgrounds. ford unveiling the new f-150 with high-tech options including hands free driving we'll show you the vehicle next. you should be mad your neighbor always wants to hang out. and you should be mad your smart fridge is unnecessarily complicated.

make ice. making ice. but you're not mad because you have e*trade which isn't complicated. their tools make trading quicker and simpler so you can take on the markets with confidence. don't get mad get e*trade and start trading commission free today. and their financial well-being. since our beginning, our business has been people. it's evident in good times, with decisions focused on the long-term. and crucial when circumstances become difficult. that continued emphasis on people - our advisors, associates, clients and communities gives us purpose, strength and a way forward. today. and always.

to save on auto insurance. there's lots of ways really? yeah. very proud of that. with smartride® from nationwide, they can get discounts for safe driving. does she get one? mrs. carmichael? safest driver in peytonville. takes a lot of work and effort to be the safest driver in peytonville. what about this guy? with nationwide smartmiles®, the less he drives, the less he pays. the list of inspiring stories goes on and on. i bet. i've never seen anyone do more with their retirement... ♪ ...than you. i... concur.

get a shot of andrew quickly. welcome back andrew is trying >> i'm in the chairs >> i'm in a different location run and get the rest of the family this is worth getting them for

this is what we do all the premers. they are in different places we need to practice. now i have to read this thing without a desk right here. it is a whole different skill set. >> andrew, you look like santoli. >> i'm in the barn i'm in the barn. >> for the f-150 story perfect. >> absolutely. >> ford unveiling the first redesign of the nation's top-selling pickup truck being turned into a rolling work station. pickup truck buyers crave technology and comfort as much

as brawn and towing pour will have a brad band connection and the area between the front seats that can make into a desk. making up for a third of u.s. sales. we'll have more on this. keep in mind, lebeau is coming on at 8:10 the ford coo jim farley is coming up at 8:10. i read all those futures i don't know whether they have a vacuum cleaner or not. >> that's all i want you know >> i think you'd like broadband with a work station. >> i don't see myself in an f-150. >> i don't either.

>> i could pull it off better than you could >> you don't think i'm handy >> maybe you said super duty. >> i have a german sheppard. two of them. i see a lot of super duty. if i'm not, he's not andrew is more of a pick up driver than i am >> i'm not arguing with you. >> i would buy a pickup truck. my kids want one >> i would buy one before either of you >> i could put the golf clubs there maybe. i'm not handy. i admit it i get the shakes when i go to

hoax depot looking for a light bulb >> costco has started to bring back the popular free samples but it is no longer the open place it used to be. items are prepackaged and kept behind plexiglass shields. hard pass on that for me get this, guys new york city, private electric scooters and bicycles have become legalized in all fiv five boers lime, bird, lyft and spin owned by ford will soon apply. food delivery has called for

these changes. tweeting yesterday the bill delivered justice for the workers that kept the city running during the pandemic. ed the world has changed in just the past couple of months. >> i just saw one scooter go flying up. what is that, seventh avenue you can tell there, more activity >> out in front of us, the guys with the beg als and sandwiches are back there are about eight people in line these are things we haven't seen there is some traffic going by our times square indicator is definitely coming to life. most have masks on and there are a lot of police. i will say that.

they are always there. we have a satellite, as you can see. that building there. across the street from the armed forces recruiting place. that's new york's finest right there. how many times do we see these >> for anybody thinking i can finally get out of the house and go back to the beach, we're going to scare you again check out this terrifying footage off the coast of south africa. this is drone footage of a big shark swimming below the group of surfers one of them spots the shark's

fin. he pushes his kayak forward giving the rest of the group time to swim away. >> sometimes sharks get a bad wrap you don't know what he's thinking >> nothing against the sharks. they are just doing their thing. i just don't want to be near it. >> we think look at that horrible predator. he's entitled to be there. >> probably more than they are that still doesn't make you feel great if you look over and see that next to you >> yeah, that would be scarey. that looks real. i don't think zakarch really di. andrew, you are leaving the barn >> going back to the studio. >> going back to the studio.

>> okay, now i have to get back to being used to being in a desk there are a lot of skills there. >> you are so smooth at this >> no one will even notice >> no one. folks, when we come back, we'll have more of this morning's stocks to watch including a big boost for virgin galactic we'll take a look at yesterday's s&p 500 winners and losers where will you go first? wherever you may go, lexus will welcome you back with exceptional offers on exceptional vehicles. get zero percent financing and make no payments for up to 90 days on all 2020 lexus models. experience amazing

at your lexus dealer. experience amazing 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. ♪ yeah ♪ ♪ y-yeah ♪ ♪ yeah ♪ hey, hey

welcome back to "squawk box. a little deal news amazon has reportedly agreed to buy self-driving zoox that would help with autonomous vehicles. shares up. i don't know if it is on the back of shares being around and rumors we asked march yiranda -- mary a about it we'll see what happens next.

albertsons will be a publicly traded company again the china pricing offering at $16 ra share. below the expected range albertsons worth about $9 billion. the private equity firm had been trying to take that company public since about 2015. joe? >> barn. missed the barn. shares of virgin right? that's very cosmo. >> i miss it too a beautiful barn it takes a long time to get from the barn back to the studio. that's the hardest time. the commute. >> get yourself a golf cart. >> green acres >> from one side of the estate to the another >> now you are back at the city sky line >> you played along in that

thing. if it wasn't friday, would you have played along? >> you know what it is, joe. my readiness number this morning is down to a 77. i could just be going with the flow >> you are vulnerable. >> the thing you had a 9 # -- 92 on was a 77? >> as the week progresses, i get worse. it is a sleep issue. >> i look forward to sleeping tomorrow but i might have some red wine or something or a margarita and then i don't sleep well i'm trying to figure out shall you got any solutions to that? don't drink. i can't do that on a weekend >> just start earlier in the day, joe that's the trick earlier in the day >> then i won't make it until

6:00 p.m >> if you stop drinking by 4:00 p.m., it will help you sleep. >> when are you starting is that what you do out in the barn >> just giving you some idea s.u >> i bet that is the cleanest barn you don't have any animals in there. >> he's got a bunny. >> we have a bunny >> i'm supposed to read this shares of virgin galactic rising the company successfully completed the second glide flight test in new mexico. that is cool looking now getting ready for full rocket powered test flights plans to begin more this summer and plans to be profitable by next year. >> back to the broader markets,

joining us is ryan payne, president of payne capital management i want to talk about your call you are stepping out with a pretty bold call a lot of people are looking at the markets and said, hold up, let's take a pause, a breather you are looking at 33 of 50 states with higher coronavirus number but you are saying right now is the time to buy and investors will regret if they don't to it. >> i called back for the record on this network that we'll see a v-shaped recovery, which most were pretty negative i think the mistake you are going to make right now is think, okay, the market has had a huge run up but we are not going to see any dips. there is so much money in cash right now. looking at the $5 trillion in

cash so many are getting out of the market retail investors as well as our firm are afraid to get back in the market i remember from 2008, 2009 with the stimulus the news was this bad and sitting in cash, it is just rocket fuel to push markets higher >> in 2008, 2009, you did see some steep drops as investors got spooked. do you think we'll ride that out more now that the federal government spends an inhe had kribl amount of stimulus >> i don't think investors ever learn their lesson at one point, gdp was calling for a 50% decline in the second quarter. i think it will be bad but not that bad when you saw that jobs number come in in may, which was so

much better than expected. talking retail sales, they were double than expected i think you are going to see strategists looking at the dire news i don't know about you, i've been hearing about that second wave since march what your biggest risk here is surprises in the positive. that is what we are seeing all along here with that cash where we are waiting. they keep coming in and buying because there is so much pressure to buy here >> we were talking about the job's report you mentioned the last job's report was so strong if we see worse numbers for the report that comes out on thursday, do you think that's just a head fake along the way >> i do. that data is backwards looking

i wouldn't be too concerned with the numbers coming in. based on the outlook, i think it will be hard to hit those lower numbers. but, yeah, a head fake on that absolutely >> ryan, bold call you did call this early and you've been right. it is good to see you. >> thanks, becky so someone has an idea here that i think has a lot of merit. you see the little bugs there. what about your readiness indicator if we were to put it on the lower side of the screen, so people -- does it change all morning long >> you could do it you could do a live reading. if you did that, you'd have to try to do like some sponsorship arrangement with one of these companies. >> what is your number again >> he's at 77.

that's awful >> i like you at 77. it is fun. >> it says your overall readiness is good but your resting heart rate is above average. i had like a cereal binge last night. if you feel tired, skipping the gym could help the problem is i skipped the gym yesterday, the day before and the day before that. >> dr. gottlieb told us it is more important to take a nap than workout >> do you mind disclosing what it was i'm sure it is no sugar. >> life cereal

right now is a time for action. that's why usaa is giving payment relief options

to eligible members so they can pay for things like groceries before they worry about their insurance or credit card bills. discover all the ways we're helping members today.

welcome back to "squawk

box. verizon says it is going to pause advertising on facebook calling out the social media giant for not going enough to curb hate speech saying it is halting ads until facebook can create the street's stake we'll talk about it next you're first. first to respond. first to put others' lives before your own. and in an emergency, you need a network that puts you first. that connects you to technology to each other and to other agencies.

built with and for first responders. firstnet. the only officially authorized wireless network for first responders. because putting you first is our job. you should be mad they gave this guy a promotion. 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.

welcome back to "squawk box" this morning. nike reporting a surprise quarterly loss this is the second time in eight years it missed bottom line estimates. online sales rose 75%. on a conference call with analysts niek kae's ceo talked about the strength of the digital operations >> we've seen the strong digital momentum continue throughout the quarter and into early june even

as stores have begun to reopen >> joining us right now is our own director of consumer research at refinitive good morning to you. you speak about the earnings is it that analysts and investors were so off on this. how were we supposed to think about this given the pandemic? >> indeed. nike did miss earnings and revenue, but i think what's more powerful is the message they made during the earnings call. they are positioning themselves from the long term and they have learned from what's going on and they're using the strategies to better position themselves our latest refinitiv survey tells us consumers are missing experiences and health and wellness is on the top of their minds. nike does just that to gain through the digital platforms.

through the nike training app they were able to gain significant new customers in china where the coronavirus first hit and as a result that translated into strong sales in china that helped offset the weakness of the 90% stores that were closed in north america, europe, and latin america. so that tells us that nike is learning that -- because we said that going forward they're going to be investing heavily more on these experiences and these memberships in order to cater better to the consumer which in the long term will be a better strategy that consumers are gaining right now. >> i have to ask you a question, which is what percentage of their business actually comes from the nike-owned stores typically? >> right so in north america it's about 41% and when you combine the three areas that were closed which is europe, latin america and north america, that would have been 80% of their revenue so when you take into

consideration the numbers that they posted based on the strength in china, which, again, was the first place hit, so it's telling us about the recovery, then you look at those numbers closer in different perspective and say nike is a very strong brand and they are very -- they're positioning themselves with a direct to consumer strategy very well. >> what do you think the stock is worth >> consumer behavior is changing well, this is a stock that -- >> what do you think the stock should be worth. >> -- a year from now will probably be -- that's why. strange times like these, a smart estimate, this company has a strong balance sheet the leverage when you look atley quit at this, it's very well positioned to go not now -- >> you say buy the dip >> i think the stockstill has room to grow >> great very nice to see you always great to get your perspective. hope to talk to you soon thanks becky? andrew

thank you. when we come back, blackrock's rick reader and former barclays ceo bob diamond. the stocks are pointing to a lower look we'll continue to watch this the dow is implied down 64 points you e tcngarwahi "squawk box" right here on cnbc since my dvt blood clot... i wasn't sure... was another around the corner? or could things go a different way? i wanted to help protect myself. my doctor recommended eliquis. eliquis is proven to treat and help prevent another dvt or pe blood clot. almost 98 percent of patients on eliquis didn't experience another. -and eliquis has significantly less major bleeding than the standard treatment. eliquis is fda-approved and has both.

don't stop eliquis unless your doctor tells you to. eliquis can cause serious and in rare cases fatal bleeding. don't take eliquis if you have an artificial heart valve or abnormal bleeding. if you had a spinal injection while on eliquis call your doctor right away if you have tingling, numbness, or muscle weakness. while taking eliquis, you may bruise more easily- and it may take longer than usual for bleeding to stop. seek immediate medical care for sudden signs of bleeding, like unusual bruising. eliquis may increase your bleeding risk if you take certain medicines. tell your doctor about all planned medical or dental procedures. what's around the corner could be worth waiting for. ask your doctor about eliquis.

what's around the corner could be worth waiting for. [shouting] [clapping and shouting] [cymbals clanging] [knocking] room for seven. and much, much more. the first-ever glb. get 0% apr financing up to 36 months on most models, and 90-day first-payment deferral on any model.

. futures under pressure to end the week we will talk about the big drivers with black rock's rick rieder still ahead financials down on this news a look at the sectors coming up. plus, your money, your vote. how much will the presidential election play in the market? pollster frank luntz joins us with data as the second hour of "squawk box" begins right now. good morning welcome back to "squawk box" right here on cnbc i'm andrew ross sorkin along with becky quick and joe kernen.

2 1/2 hours before we open the dow looks like it will open off a little bit, 40 points. nasdaq looking higher again. keeps moving higher. s&p 500 higher as well joe? >> economists looking at alternate data to better gauge the pace of the economic recovery and to measure the impact of the recent rise in covid cases, steve liesman joins us now with his backrometer. that's a new one, steve. >> the road back barometer, thanks we have the rise in cases and what we have as a result of that is not a decline but a flattening of the curve of opening up the economy here. let's take a look at the covid data right away from the covid tracking project we are now running at 106% of the april average in terms of new cases. what we have not seen yet is a spike in the number of hospitalizations or deaths

they remain at around 30% of the april average which was the worst month so far you can see that in the chart as the seven day average of these cases spike up and rise. big jump hospitalizations and deaths not following along, thank god, obviously. we'll see if that becomes a delayed indicator. looking at what's happened on the economic side. the apple mobility index continues to decline some gains in transit and walking -- requests for walking directions as well as driving directions remain above the january average that they measured against but it's the home base employees working that's down 24%. this has been coming up and now you'll see in a second store closings, yeah, continues to register. store closings on a week over week basis not a net gains nationally here's the employees work home base that economists like because it did a good job of telling us there were jobs

created in the month of may. and so now that's flattened and it actually has gotten a little bit worse. so that's something that may be related to the covid spike i want to introduce you to a new barometer here tech startup burbio, they aggregate calendars from all over 3100 counties around the country and what they look at is community activity schools, libraries, chambers of commerce, all civic stuff. you can see it's opening somewhat or getting towards 80% opening in the -- some of the smaller areas with the bigger cities, the bigger towns have not really been open this map needs to go big -- really dark green in order for the u.s. economy to be open. on the one hand i think these libraries and schools will be very cautious. this may be a leading indicator, guys they're picking up calendar events it goes in the calendar and it's going to happen as a live event.

they will tell us that it's opening. so you can see there we need to get dark green on this map in order to get it back so right now majority of the country remains closed some gains in this index but it's another thing, becky, that we're going to be following. if the schools aren't open, i don't think the country can be open >> steve, if you pull that map back up for a second, just glancing at it, it seemed to me like the areas that had the most dark green also happened to be the places where you're seeing an increase in cases at this point. i think 33 states are seeing an increase in cases versus decline but places in the northeast like new york and new jersey and connecticut where you're actually seeing fewer cases, it's because they're still shut down i think the big question is what happens. >> right. >> you can see some of the areas like in florida, texas, where the darkest green is, that's why they're seeing increased cases it's inevitable.

it's can you avoid the outbreaks and the real hot spots. >> and what we can do, becky, is come back in a week and look at how this map has changed what i think also is out there is there's a sign of confidence that you can get from this map in the sense that, you know, if you've got a guy or a woman who's a director of a library and they schedule an event, they've got to be pretty confident in that. the schools when they open, they have to be pretty confident. when we start to see this go darker green, we'll have some confidence that some of the most cautious people in the country are ready to start scheduling live events. it's not the case right now and you're also right to point out those dark green areas if they start to go the other way on that, that would be a bad sign >> steve, have you been out? have you had dinner at an outside restaurant yet >> i have not, joe >> i did last night. it was good. i'm telling you, you're going to

love it. >> how was it? >> it was unbelievable. >> in the car i'm passing them and i'm looking in the restaurants literally, how are they doing this? i'm wondering more importantly is my stella blues band, we're trying to schedule some concerts, you know we don't know what to do we're waiting to figure out what to do. should we to it or not >> i've seen -- you've seen comments, eddie van halen -- no, the other guy, sammy hagar making weird comments. >> yeah. >> i went -- it was just two of us, but i gave money -- they brought me food and i gave them money. it was -- unfortunately it was a bring your own and i didn't know it was deep. it was really good really, really good. no dishes to do. >> that's nice. >> it was a beautiful night, cool breeze. and people waiting -- >> joe, i want to run this by you. my drummer says what she should

say when we do our first show is no masks, no music, which means we have to stop the band if people in the audience aren't wearing masks. what do you think about that >> that's a good idea. >> you going wear a mask when you're singing >> turning someone down without a mask, they got a bunch of tips, $21,000. with you i'd get confused between the stella blues band and the mud rakers. >> no, it's the moon cussers. >> moon pies depending what you play, either one or the other is it the same group of guys >> one is sort of original music. the other is a hard core grateful dead cover band as you know, joe. >> that's from waco flood, is it not? what is it from? >> you know, people don't know you're a closet -- not so closet dead head out there, joe. >> that's true you know my favorite song,

"unbroken chain. phil didn't sing a lot but beautiful. sorry, beck. thanks, lies liesman. >> joining us right now -- >> so is the producer, as we know >> we're moving on joining us no for more on the markets is rick rieder he is chief investment operator of blackrock i've taken to think of these weekly sessions, this is like sitting down with a shrink to figure out what's happening with the markets. we were told you can't fight the fed in this position we learned this from 2008, 2009. he said don't wait for a dip to buy. at the same time we're looking at coronavirus cases rising in more states than not and looking at some hot spots and wondering what that's going to mean, if there's going to be a roll back in some reopenings of the economy or if consumers will get nervous and not show up for any

of these things. where do we stand right now? how are you feeling? >> so thanks for having me, becky. i didn't do very well in psychology classes so i hope i'm not acting in that regard. i would say a couple things about markets. i mean, you brought exactly the right point. you know, the economy has changed in the way you think about it the economy can still operate. one of the things we've seen, this phase one hopefully only we don't get a significant reverberation in terms of corona, but parts of the economy are still operating very well. obviously what's happening with retail sales online, what's happening with seeing things like the trucking side, et cetera clearly what is going on, you are going to stretch out a lot of the development, whether it's travel, whether it's hotel, whether it's leisure, et cetera. restaurants while reopening, you clearly are going to slow that down the equity market has been reacting to that, i think rightfully so.

the interesting thing about investing, you have the playbook because we watched it play out for the last two or three months the markets are more comfortable with i've seen what happens, i've seen what really slows and the places where the economy operates are doing pretty well in the markets >> so that sounds like you agree with ryan that you wouldn't necessarily buy -- wait for a dip to buy >> so i actually -- i agree with a lot of what he said. listen, we were hoping, in fact this week we got a bit of a pull back the liquidity that's coarsing through the system is interesting. one of the metrics i use is pretty powerful. i look at not just where interest rates are today but where forward interest rates are. if you take where free cash flow is in the equity market relative to forward interest rates, equity market is not high. from a pe ratio it's not that attractive love to get some pull backs. you'll use the options market to try to get some convexity into

the market when we get dips we try to buy it, particularly in names. when we get dips in the names, we try to buy some stuff the hard thing is, i'm not into a lot of fixed income. if you have to generate return in your portfolios, which is what our clients want, you have to be more in equities. >> rick, one of the things i'm trying to kind of figure out is how the world's going to look after this because even once we get back to a more normal live, i think there are so many changes that have been set in place or fast forwarded by what we've seen happen. you think of the nike story today where nike is under pressure because, shock, they didn't sell a whole lot in stores during the quarter. digital sales were up 75%. i think that's a big move for brands brands versus retailers are coming out much stronger with connections to their customers you've seen it play out in places like movie theaters versus movie studios where movie

studios are saying, hey, consumers are looking for different ways to get this it shouldn't necessarily be only 90 days that it's going to be in movie studio before it gets to the rest of the world. you think about things like real estate companies they're going to have to probably change their relationship with landlords, and i mean that for not only retailers but for businesses, too. they're going to say we don't want the same number of people that are back there. how do you kind of get your head around some of these and figure out where to invest long term? >> so, you know, i think it's funny, you know? we like simple things, we like to say the economy is a v, u, other shapes that have been described that way, but when we think about the economy, it's a compilation of a series of different shapes like you say, some industries are going to have a very, very different recovery pattern than others and the ones we talked about are going to be, you know, we think continue to do well. technology -- the change in technology, we were going through something -- evolution of commerce and evolution of

virtual and evolution of how you data transmission works and that is just going to push it yet further. it's part of why i think performance is showing up where it is in the markets becky, one of the other things that's happening is people are realizing, this is the sad part of it, you can operate with fewer employees and in a lot of industries, you know, the unemployment rate is going to be stickier to come back because of this dynamic of you can operate efficiently that way that is, again, some of the disruptive nature of it. part of why the fed has to continue to execute on their mandate. but i think you're right i think there's some real permanence we're trying to evaluate in a lot of commercial real estate how do people think about office, hotel, you're seeing the markets bifurcate themselves by industry, company, quite aggressively >> so the most important take away from this conversation, rick, is, again, fixed income,

you can't beat what the fed is doing there. the fed is taking up so much of the market that you have to look for other equities to do it. every time we talk i get some incredibly useful thought like that. >> thanks a lot, becky it's an interesting time flr things to do in the bond market that are more attractive than the equity market part of what we think in investing is where are you supposed to optimize your return and do it in whatever market lets you do it. >> thank you, dr. rick i'm going to call you that. >> thanks, becky >> talk to you later andrew >> thanks, becky. coming up when we return, the election and the potential market impact. frank luntz will join us with interesting data including how voters are feeling about taxes, the economy, protests. before we head to that break though, shares of nike dropping this morning the company posting unexpected loss poredow component hurt by retail exsus amid the pandemic.

"squawk" returns right after this payment relief options to eligible members so they can pay for things like groceries before they worry about their insurance or credit card bills. discover all the ways we're helping members today. deposit checks, check balances, pay bills, and more. explore all you can do with our digital tools from almost anywhere. pnc bank.

from almost anywhere. bbut what if you couldg do better than that? like adapt. discover. deliver, in new ways, to new customers. what if you could come back stronger? faster. better. at comcast business, we want to help you not just bounce back, but bounce forward. and now, with one of our best offers ever, we're committed to helping you do just that. get a powerful and reliable internet and voice solution

for only $29.95 a month for three months. call or go online today. welcome back, everybody. verizon says that it is halting ads until facebook can create an acceptable solution that makes the telecom company comfortable enough to return to the platform shares of those companies this morning, you can see verizon shares up by 12 cents. facebook shares down by almost a percent. andrew, it's not the first

company to say this, but it is by far the biggest we've heard from other companies like ben & jerry's, patagonia, probably not a surprise to see some of those companies pushing back, but to see a major company like this does make you wonder what happens i think ultimately it comes down to whether the ads are actually effective or not, if people feel like -- the companies feel like putting their ads on this platform makes people feel mad at them, then they won't put their money there. if they feel it's effective, most companies will probably go down that line. >> right we'll see how long this is a month-long effectively boycott but at the same time some of the language arg dwug that they're not going to come back on the platform until things are fixed, we'll see what that looks like. we'll see whether others join or don't. that will be a big issue thanks, becky. meantime, business executives and the markets, they are bracing poor potential joe biden win in november as the president's numbers slide in

national and swing state polls let me get to frank luntz, pollster, political strategist he's been spending a lot of time, all of his time thinking about what is about to happen next frank, walk us through the polls because a lot of investors are now focused and at least if you look at the betting sites and the polls, it now appears that biden may win. >> i'm not surprised because the national numbers really don't matter and this is where joe biden has surged to a 10 to 14 point lead what really matters is michigan, wisconsin, pennsylvania, north carolina, florida, even ohio is up for grabs states that donald trump won in 2016 have now shifted towards joe biden by anywhere from 6 to 10 points, and that's significant. that's beyond the margin of error. second is that trump goes to tulsa, oklahoma, which should be a rock bed of republican

support. he doesn't even come close to filling up the arena and this is in his core constituency third, joe biden has been pretty quiet. we haven't seen much from him and yet the quieter he is, the better he's doing in the service. that ought to tell you something. the more that donald trump speaks, i think it's the message, i think it's what he's saying, the worse he's showing up now it's very early. he's still got more than four months to go there have been a number of elections, 76, 68, 1984, even 2016 where the numbers changed in the last 30 days. so you never, ever count anyone out. these have not been a good two weeks for donald trump. >> so, frank, just explain this. you said it was -- that there's a margin of error there in terms of these numbers and, of course, we talked about lots of margins

of error and it surprised a lot of lot of people why are you convinced? just so we know. >> so i look at the spread i look at the trends where things are going over the last couple weeks and i watch what the president says, and quite frankly the language that he's using is not language to the american people. he's being very tough. the public wants empathy they want understanding. he talks about law and order he should talk about public safety he talks about people being warriors he talks about draining the swamp when the swing voters, the people who are going to decide this election, they want someone who's going to fight for hard working taxpayers. the president's language is off. >> frank, let me ask you this. what about the gaps that biden makes and makes repeatedly i believe it was just yesterday or the day before he made this reference to 120 million people

dieing of the coronavirus. he missed that and should have taken a zero off of it what he was talking about was 120,000 people do you think that the american people are going to look past those mistakes >> they are now because biden's been quiet and trump's been very loud i guess is the best way to put it, and during the debates you know that biden's going to be held accountable for that yes, this election is absolutely not over but it's joe biden's right ow, it's joe biden's to lose if i were the trump campaign, i would demand five debates, not three. number two is that i would change my lexicon. i would communicate much more with heart than with a fist and number three, if i'm joe biden, i am -- honestly, i'm staying in

the basement i'm staying away from the media because every time they film me i make a gaffe every time they film me i make a serious fundamental mistake. >> let me ask you, frank, there's a strategy question. it goes to what you're saying in the trump administration and the biden campaign needs to do you're saying biden needs to effectively disappear, but the other issue is that i think trump has been historically most effective when he was going after hillary clinton, for example, of really hitting and hitting hard that was a successful strategy, at least four years ago. you don't think that same strategy can apply in this case? >> that's exactly the point. that's exactly the point, that things have changed. conditions have changed. our economy has changed. the way we relate to each other has changed. there is a realness, an anger, a frustration, an anxiety that exists in the american people that did not exist in 2016 and

hillary clinton was very easy to dislike. donald trump had her number. he knew exactly what to say. now in 2020 we have all of this ugliness in the streets all across the country and the public is looking for something different. andrew, don't rerun the campaign >> let me ask you about economic issues though, especially given this audience that's watching us now. how do higher taxes play and what do you think that the business community really thinks about the way they want to vote right now? >> so we've been measuring this, and i will tell you that there's greater acceptance for higher taxes today than there has ever been in my research. this goes back to ragan/mondale in 1984. that's how significant this is a willingness to pay for the spending, a willingness to keep the economy going, a willingness to keep something going because of all of the unrest that's out there, number one. number two, the business

community just wants predictability they just want to know what's going to happen and if they get that, at this point they're willing to support anyone who gives them a sense of stability and a sense that things will calm down and that's why biden has actually moved in the business community people now are considering voting for him again, it is donald trump's languag language, it is not his policies that matter. >> okay. frank, we will talk to you again soon, i hope, as these campaigns heat up and we learn more. thanks so much for your perspective. joe? >> thank you. >> i think biden immediately corrected that, but no one put it -- he had to take three zeroes off, andrew i'm correcting you take one zero off you're at 12 million. >> yes yes, you're right. now i'm -- you're correcting me, i'm correcting me. >> don't feel bad.

don't feel bad because it's an informative interview and it took me four minutes to get that you needed three minutes i'm going scientific notation. he corrected it, i think, right away you know, that reminds me of why say trillions. coming up, the federal reserve putting restrictions on bank dividends after signs of stress for the pandemic as we head to break, here's a look at the banks in the pre-market not pretty "squawk box" will be right back. time now for today's aflac trivia question. what global car manufacturers also sell motorcycles under the e sw wn bcsqwkthe united states? thanerhecn "ua box" continues r bills. fifty dollars here. eighty dollars. a hundred dollars. i had good health insurance. why isn't this covered? well, then they started getting bigger. eight-hundred dollars. eighteen hundred dollars.

i saved for this. but not that much. i'm glad i had aflac. they gave me money when i needed it most. that's why aflac is here, to help with the expenses health insurance doesn't cover. i love that aflac duck. aflac! get to know us at aflac.com ♪ yeah ♪ ♪ y-yeah ♪ ♪ yeah ♪ hey, hey cool? drop the taco. get in the car. does this sentra feel like a compromise to you? wait, what...? the handling is good, right? no compromise there. nope! watch this... umm... b-brie...brie brie! rear automatic braking. so if this nissan sentra isn't gonna compromise, why should you? you're right! atta girl. the all-new nissan sentra. with more standard safety features

than any other car in its class. with more standard safety features 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. ♪ ♪ ♪

now the answer to today's aflac trivia question. what global car manufacturers also sell motorcycles under the same brand in the united states? the answer, honda and bmw. >> bring up joe. >> like a cat nap. i didn't notice.

>> it's not you, greco >> if it's not going to bother you, we're going to stop especially to get you back especially after reminding us the days are getting shorter. >> it's offset by it is friday >> nice to get back to normal things if we can annoy each other about normal things, great to be a friday. still to come on "squawk box. financial stocks under pressure as the fed puts new pressure on the banks. speak to bob diamond about the nation's financial system. new jersey governor phil murphy ready to outline guidelines for reopening in the fall. that's a big precursor we will see what he is looking for on that front and how things

are going. we'll speak with him ahead of the announcement check out the futures at this hour dow futures down by 76 s&p futures down by 1. the nasdaq is indicated up by 10.5 points. "squawk box" will be right back. with smartride® from nationwide, they can get discounts for safe driving. does she get one? mrs. carmichael? safest driver in peytonville. takes a lot of work and effort to be the safest driver in peytonville. what about this guy? with nationwide smartmiles®, the less he drives, the less he pays. the list of inspiring stories goes on and on. i bet. i've never seen anyone do more with their retirement... ♪ ...than you. i... concur.

the bank stress test results are in and the fed has ordered banks to limit dividends and halt buy backs warning that a prolonged downturn driven by the pandemic can result in deep losses wilfred frost, i'm excited by this, because he's on the squawk news line. it means we're going to use this picture that is so amazing, wilf i don't know if you've seen it

you may not know what i'm talking about, but i think it's my favorite of all the phone pictures that we use for phoners. it's un -- >> you're kind, joe. i have seen it because, in fact, i'm in it, but i'm just grateful to mary duffy and team for that helpful air brushing. >> no, it's not. it's not i know you and it's not air brushed. oh, my god >> well, i'm sorry i'm not with you in person. we had a problem tech wise let's get to the stress test under the rules fed vice chair said, quote, the banking system remains well capitalized under even the harshest of down side scenarios. it was headline grabbing aspects that have put pressure on bank share prices overnight most important was the fact that given the uncertainty created by the virus, banks will have to resubmit their plans and be retested again this year likely

around september markets, of course, want certainty. we only have it as it relates to capital plans for a few months as for the current capital levels, they announced that individual fed results next week but based on analysts estimates it looks like goldman sacks is below the required scb they will not need to raise new capital. there's plenty they can do beforehand to rectify the situation. jpmorgan also caught them a little bit more than expected. on the flip side, the biggest positive surprise is morgan stanley. the required scb fell rather than rising likely because of their etrade acquisition citi's required scb increased relative to expectations cannot be higher than trailing 4

quarters of earnings, the limits on dividends there's plenty of head room. each quarter low earnings replaces good earnings from last year, the numbers could get tougher, especially for wells fargo. dividends, 51 cents. trailing 12 cents earnings it's widely expected they'll have to cut their dividends. share prices overnight down a couple of percent. in the scheme of 2020, not enormous fall back in their share prices guys >> wilfred, thanks we're going to get this to someone who i hope has been pouring over these numbers i'm sure he has. bob diamond, ceo of atlas merchant capital we've talked about this a few times on the air, bob. that is that because of 2008 and what happened, these banks are better capitalized than in previous times when we've -- the economy has come under a lot of pressure we've taken that as a given and i'm hoping that the stress test

proved to you that narrative is correct, that the industry is in pretty good shape to withstand everything that's being thrown at it this time around >> yeah, joe i think from the fed's point of view it's all about capital. i think the tweaking they did with the vulker rules was about derivatives, not proprietary that freed up 40 billion in capital for the big banks. so i thought this was the kind of action you would expect from the fed during a crisis and this is a -- you know, in many ways a crisis and i think it was prudent it was thoughtful. and i think the results show that we have a well capitalized banking system at this time which is, as you said when we started, very important. >> okay. the way that they have decided what's prudent for banks, no buybacks but you can keep paying the dividends.

that didn't go far enough. we know that the last obama holdover i think at the fed thinks that they should be paying dividends either. is that grossly political or is that prudent you don't want to get to the point where the people that have -- once again, the asset holders of the banks, they get their dividends. if the banks get into trouble, then once again the public ends up bailing them out and normal people didn't get any of those dividends and here they are bailing them out again is that likely to happen >> yeah, i think all of these actions mean that our banks and the government are working much more closely together. i think -- if i'm not mistaken, joe, most of the big banks that agreed not to do buy backs and i suspect they'll be fine with a period of more caps and more -- you know, more focus on the amount of dividends because as i

said at the beginning, i think for chairman powell, this is about capital. this is about keeping as much capital in the system as possible during this period of a crisis so i think it's an appropriate discussion i don't think there's any perfect answer, but i think the way that the fed has gone about this is both prudent and thought full and i think they've come up with a pretty good solution for now. i wouldn't be shocked if down the road maybe they did more limiting dividends. >> yeah. i'm sure elizabeth warren doesn't think that we should keep -- that they should keep paying dividends just on the chance that this lasts longer. sherod brown, i read, from ohio doesn't think -- why not take a step back on all shareholder distributions, not just the buy back >> listen, in all of these actions they're already limiting

them, joe. they're eliminating buy backs and they're eliminating the amount of buy backs. they're already in that position the democrats would like them to go further of course they would that comes back to the same core issue. that would leave more capital in the system. >> andrew? >> bob, i wanted to ask you just about consolidation sort of given where we are, given the conversations we've probably had now over the last 12 years since 2008 and just how much consolidation there is and whether you think that poses any risk at this point. >> so i don't think there's risk at this point, andrew, but i think the facts are kind of clear. as i look at andrew ross sorkin, the author of "too big to fail" and i think of 2008 and 2009, the whole focus from elected officials, not just regulators, was we will never have too big to fail again. and i think today if you look at the siffy banks in the u.s., the

eight institutions, they're all bigger they all have more concentrated risk i think the amount of deposits of the top four banks in the u.s. are now double. they own 45% of dtc. i think the risk is more correlated with a national government and, you know, that's not -- those are just facts. so if the goal was to eliminate too big to fail, i don't think that that's been accomplished. but if the goal was to make the banks extremely well capitalized and more aligned and interconnected with public policy, that probably has been accomplished >> bob, we've talked a lot about what the fed has done, extraordinairy things the fed ha thought necessary to handle this situation. do you have any issues or just kudos for the fed's handling of the pandemic and the shutdown?

>> so this far i think the grade for the fed and the treasury has to have an a in there somewhere, whether it's an a or a minus i think their actions havebeen phenomenal i think they've been fast, joe, in terms of getting right off the mark i think they've been very, very broad. of course all of us are going to want to see a full four years of university, if i can use that example. and over the years we also have to make judgments based on how this plays out down the road, but right now i think we're already in economic recovery i think it will be jagged. i think it will take a while for all the reasons that we have talked about, but you have to give credit to the fed and the treasury for the actions that have been taken. they've been phenomenal. >> hey, bob, just really quickly. we had mike mayo on yesterday. i asked him which banks he

thought could be in the worst potential place if we saw loans go bad, some of the areas hit hard if they have bigger exposure to it he said the banks he would be concerned about would be the smaller banks because maybe they would be in a position to have a lot of small business loans. the businesses wouldn't be able to open up again it made me think, you know, we get concerned about banks being too big for sure, but maybe being big has some definite advantages, particularly in a pandemic like this. >> well, i think right now the size of the banks and the capital levels that we've talked about mean that the -- kind of the banking system, particularly around the larger banks, is very safe i'm not as close to the smaller banks, but i think the trends that we're seeing are trends toward consolidation of the smaller banks. so i think directionally i would agree with mike. >> bob, thanks we're going to end it here i mean, that was just -- you

just brought up "too big to fail" on your own. i know andrew talks to you at times. he didn't ask you to plug that or anything? >> you can't look at andrew ross sorkin, the author of "too big to fail" and not bring that up. >> now you're just piling on here. >> i love this guy. >> so he didn't ask you -- that was you being a good guy, huh? you're binging billions this week, too? do you want to get that in while you're at it, bob? >> never -- never seen an episode of "billions." you don't have me. >> i took it too far sorry, andrew. let's get out of here. let's get to break thanks, bob. >> thanks, bob. when we come back, a new report from mckenzie on the growing achievement gap and the impact on the economy. when we come back, you're looking at winners and losers on the dow this morning

usaa was made for right now. and right now, is a time for action. so, for a second time we're giving members a credit on their auto insurance. because it's the right thing to do. we're also giving payment relief options to eligible members so they can take care of things like groceries before they worry about their insurance or credit card bills. right now is the time to take care of what matters most. like we've done together, so many times before. discover all the ways we're helping members

at usaa.com/coronavirus ♪ ♪ ♪ 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. ♪ yeah ♪ ♪ y-yeah ♪

♪ yeah ♪ hey, hey welcome back to "squawk box. futures actually i think turned positive just briefly about a half hour ago, back down on the dow. the nasdaq finds some buying most mornings when you don't see it evident i guess that's not surprising with all the technology and the stay at home sort of plays that we've talked about so much s&p is basically unchanged let's take a quick look at oil this hour, which has been problematic if you're looking for a big v-shaped recovery in the last couple of sessions.

it was above 40. almost got to 39 which is not a prleobm. probably pretty good to when we were down in the teens we'll be right back.

(music) anncr: give customers access to precisely what they want, when they need it the most. with adyen, the payments platform that delivers convenience for all. adyen. business. not boundaries. bbut what if you couldg do better than that? like adapt. discover. deliver, in new ways, to new customers. what if you could come back stronger? faster. better. at comcast business, we want to help you not just bounce back, but bounce forward. and now, with one of our best offers ever, we're committed to helping you do just that. get a powerful and reliable internet and voice solution

for only $29.95 a month for three months. call or go online today. welcome back, everybody. shutdowns caused by the coronavirus could exacerbate existing achievement gaps in education according to a recent report by mckinsey it's not going to be a temporary shock but something that could translate into long-term harm

for individuals and impact future salaries and economic growth for the entire country. joining us is the co-author of the report, jimmy sarakatsanis thank you for being here with us. >> thank you for having me. >> i know you are a former middle school teacher and you've been working to try to help people understand the companies and the schools understand better how to do online education, but i know you've also taken a step back to see what coronavirus has meant every parent worries about this. what does it mean for kids to be out of school in general >> yeah. i mean, look, we were all caught off guard in the spring and when schools closed there was a lot of work, a lot of teachers and other educators scrambling to figure out how to best educate children the reality is it wasn't as good as being in school and it's

likely that if that continues into the fall, which is where we're headed, that we're going to still continue to have disruptions, students are going to have less access to learning, particularly black and hispanic students and low income students, that they're going to have, you know, tougher times learning remotely than they are in person and this is going to lead to not just learning loss overall but exacerbations of achievement gaps our estimate is if this disruption in schooling continues even until january, we're looking at overall black students losing ten months of learning, hispanic students losing nine, white students losing six >> what can we do about that as a society? >> yeah, i mean, right now, look, school systems are scrambling to figure things out. figuring out, number one, how to get all students access to

devices. we have evidence that in the spring 90% of white students were able to log in to learning apps and 60% of black students number one is getting -- closing that access down number two, it's likely that not all students are going to fit in schools based on many of the physical distancing requirements according to cdc and that the states are putting out so we need to figure out how to prioritize space and capacity for those students who need it most and then, third, we have to figure out ways to surge finding extra tutors to spend one-on-one time with students who need it the most finding time over the summer, getting more students in summer school, making sure summer camps or any of those activities have more learning in them and then in the school year, you know, experimenting with extended days doing many accelerators during

time and above all making sure our teachers are ready to teach in different ways and to target those students that are going to have increased learning gaps than they've had before. >> jimmy, this week we spoke with senator lamar alexander on the program and he said he would like to carve out additional funding to make sure schools are up to snuff and ready to go in this coronavirus age is extra funding from the federal government enough or is there more the states need to be doing and maybe more companies can do to help out, too? >> yeah, look. this challenge is coming from all sides. not only, you know, do some of those things that i just described cost money but also if budgets are down, that's also known in the past from past recessions, that's widely exacerbated achievement gaps as well we think there is a case for investment those learning losses that i described before we think could

cost the country up to $100 billion in lost earnings over the lifetime of this current generation of students which could translate into about a $200 billion hit on gdp which is a 1% knock on u.s.gdp. there's absolutely a case for investment here. it's likely going to have to come from all sides. >> what would be an investment that would help bridge the gap what amount? >> we haven't created an estimate, but there are many groups out there estimating in the hundreds of billions of dollars. we have not done an estimate ourselves. >> in terms of companies, is there a program you could look to, a place where some companies are stepping in? is this about trying to make sure that the digital access is there or is it even more broad who that company should be looking for? >> yeah. i think it's time for us as a society to get creative and certainly for companies to participate in that. the digital divide is certainly

one of the more concretes finding ways to make sure that every student has a device, not just a device they can share with their siblings but a device they can use throughout the day and high speed internet. but also we need -- in many places we're going to need more space. so to the extent that companie or others can help free up space, that's another way to contribute then finally, you know, we need more adults, more humans interacting with students, especially to give those that are further behind one-on-one time companies not just donating resources but their company and time to spend time with students, spend time with students and helping them run what is operationally a more complex school day the more our organizations, our companies can pitch in with their people in addition to their money, it'll be a benefit. jimmy, thank you very much for your time today.

by the way, speaking of education, new jersey governor phil murphy will be joining us this morning to talk about the state's plans to try to reopen schools in the garden state in the fall that's at 8:30 this morning. we'll have much more coming up. >> such a critical issue for our kids and our economy. much more on the markets this friday morning. take a look at the biggest losers in the s&p so far this week let of course by travel stocks we'll talk more about that and we'll do it next. later, don't miss our first on cnbc interview with ford, jim farley's coo the veinunilg of the new f150 truck. "squawk box" returns right after this

in peytonville, there's lots of ways to save on auto insurance. really? yeah. very proud of that. with smartride® from nationwide, they can get discounts for safe driving. does she get one? mrs. carmichael? safest driver in peytonville. takes a lot of work and effort to be the safest driver in peytonville. what about this guy? with nationwide smartmiles®, the less he drives, the less he pays. the list of inspiring stories goes on and on. i bet. i've never seen anyone do more with their retirement... ♪ ...than you. i... concur. 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.

good morning futures volatile this morning. had a nice rally in the last few hours, then they lost some steam. this as the dow and s&p 500 are on pace now for their second negative week in the last three. couple of important transportation stories this hour major airline unions calling for a second federal aviation bailout for tens of millions of dollars. here on the ground, ford launching an all new f150 pickup into the truck wars. company coo jim farley joining us phil murphy is going to join us to talk about the new travel advisory asking people from virus hot spots to quarantine when they arrive 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 u.s. equity futures have moved into the -- at least the dow, moved into the red, triple digit numbers. the nasdaq continues to be in the green. up about two points. has been relative -- it's been noteworthy that it's been relatively stronger than the dow in recent weeks. the s&p now negative as well down 3 and change, now down 4. becky. >> we will continue our focus on the markets. that's where we start this hour. specifically, how it remains top heavy in terms of what investors are looking at cnbc senior markets commentator mike santoli joins us with more. top heavy, some people might consider that an insult. what do you mean, mike >> reporter: top heavy, the s&p 500 and index is still to an unusual degree dominated by very large stocks s&p year to date against the

equal weighted version of the s&p. these are the same stocks just the lower one here is equal weighted this is market cap weighted. it's an answer to the question, becky, that everyone is asking, how can the market be so close to the highs or down 5% year to date the market, so to speak, is here june has been a month of choppy pull back consolidation in this market, whereas, the regular s&p has more or less gone sideways that's because of the dominance of the very largest stocks so we actually have had some recognition of the economic difficulties, especially the reopening issues, if you look at the average stock. to illustrate this more closely, microsoftjpmorgan. two best in class companies. one is up almost 30% this year, one is down almost 30% this year the market cap gains in microsoft are double the market cap losses in jpmorgan for every percent that microsoft

goes up, jpmorgan has to go down 5% to offset that. this is what's going on stock by stock, sector by sector. the overall s&p 500 helps explain how this very concentrated market is able to hold together anchored by a strong corporate credit market and everything going on by the fed as stocks like banks and other cyclical stocks suffer and struggle through this environment, guys. >> hey, mike, just in terms of what this is reminiscent of, when markets get top heavy like this, what does that lead to traditionally? >> you can look back the last time you had a real bout of this was the late '90s not the end of the internet bubble but as you got into the late '90s, this was the case if you want to look at the top ten or top five, whether they dominated the s&p the way ours do, you go back to the '70s and '80s and there were periods like this in the '70s and nifty 50

era. giving way to a broader market that happened in 2016. you did have a broadening of the market and a value trade there's no particular script it follows. the way to think about it is the large stocks for now are insulating the index against more pain than they would otherwise be feeling the question is can they really bridge us over to that point where everything else benefits from a recovery. >> thanks, mike. we'll see you. >> meantime, we are now joined by a very special market guest who warrant of the systemic market risk. joining us is kassim taleb the author of "black swan. it's great to see you this morning and great to just check in and understand what's going through your mind and how you're looking at both the economy and the markets right now. >> hi. thanks for inviting me

>> what is -- how are you looking at this given where we are given how much stocks have run and then recently, of course, what looks like a little bit of more spread and potentially even more than that and how the markets are reacting to it? >> i'm not -- you know, i'm -- i don't follow noise in the markets that we are witnessing now as noise let's look at the fundamental issues that we're facing bonds practically have no up sides structurally because you may have some negative interest rates for frictional reason but you can be -- it cannot have really negative interest rates fixed income instruments have pretty much run their course so you no longer are able to hedge using fixed income instruments. they ran their course. your bonds went to whatever the maximum value they can have. and, of course, federal policy

by putting interest rates at zero, they also lost a weapon they have. so an investor no longer has a traditional hedge of having a big stock portfolio of using bonds. so what's left is only one thing, you know, make sure that you don't -- you know, the thing we do for a living is make sure we're not blowing up and you keep your stocks for the up side and protect your down side >> but how do you protect your down side in this market then? >> i mean, if you don't have a tail hedge, i suggest not being in the market. that's the idea. and if you have a tail hedge, then of course you're going to have the opportunity we really -- what we're facing is a huge amount of uncertainty for many reasons they've been printing money like there's no tomorrow. they're going to print more money. they have no other possible policy other than just print

money and distribute it to people they cannot lower interest rates. as we've said, they've lost that monetary policy tool and the covid seems to be thinner. i mean, even if the pandemic -- the rate of contagion, that dies out, you will still have people cautious enough in their behavior that the pandemic will be there and affecting a lot of industries so given that, you may expect some kind of inflation i don't know we may be now in a deflationary phase, we don't know but the notion that you may have mild inflation is lunacy because there is no such thing as light inflation. either you have big inflation or you have a very large deflation. so typically mild inflation is a trans is a tori state that doesn't seem to exist outside

conversations. so you need to in a very inflationary stage, stocks pick up you cannot lose your stocks. hedges cash burns very quickly. deflationary stage also, you know, you may have a problem so you need to balance all these things out by having the most possibly conservative portfolio today. i'm not just talking about individual institutions today you need to be vastly more careful about what portfolio you have and make sure your down side risk is protected >> naseem, can i just -- if you're looking at a market where we would be potentially dealing with extreme inflation, it seems like you would have to be in the market because if you're keeping money in cash that's going to be worthless and less every moment. if you're looking at a situation where we have zero rate increases, then you can't keep money in the bank because you're going to get nothing for that

either it's really complex and it's confusing, but if we are looking at potential hyper inflation, you've got to be invested in something because you can't keep cash. >> exactly you have hyper inflation or mild inflation or you're going to have continuous deflation. you need to be hedging for these two states, which makes things very delicate. the first thing i would say is bonds will hedge you against nothing from here on nothing. >> naseem, you were very smart early on to call for masking, masking across the board to the extent that you're focused on the covid numbers and thinking about second waves or second order events, how do you see it right now >> okay. the first thing is it's quite offensive to see that people are politicizing something like

transmission of a disease like if you belong to a certain political viewpoint, then masks are bad and for the other one masks should be mandatory. i believe without masks we can't pull out of this because it is effectively transmitted in a certain way that require masks people fail to understand the payoff of masks. masks are a free option. i think that we can really reduce the rate of transmission via masks. there are lots of papers and evidence around. we analyzed it i said masks are very complex. they block just half the virus load they may reduce the infection up to 90, 95%. i have a mask, you have a mask jointly we definitely bring the rate down. there's also the ethics of it.

if i'm not wearing a mask to protect myself, i am wearing a mask to protect society from a pandemic, first order to protect you if i run into you but also to protect society because every person we infect if you don't have a mask it infects many more it's much more than one. you have to wear a mask and i think that had they realized early on that would have saved us a lot of money, a lot of trouble, a lot of money would not have been printed had they understood the role of masks look at asia, taiwan, places that were very, very, very -- >> nassim, love talking to you love your perspective. love to continue this

conversation we appreciate it have a great weekend talk to you very soon. >> great thanks a lot have a good day. >> thank you you bet. coming up, a fork in the road for ford. they should take it. the automaker completely revamped one of its cash cows. the f150 pickup truck but it's also facing increased competition in the red hot pickup market. anyway, more in a first on cnbc interview with ford's chief operating officer, jim farley when "squawk box" returns.

there are times when our need to connect really matters. to keep customers and employees in the know. to keep business moving. comcast business is prepared for times like these.

powered by the nation's largest gig-speed network. to help give you the speed, reliability, and security you need. tools to manage your business from any device, anywhere. and a team of experts - here for you 24/7. we've always believed in the power of working together. that's why, when every connection counts... you can count on us. ford launching a new entry

into the pickup wars phil lebeau is here. good morning. >> reporter: good morning, becky. let's bring in jim farley. coo of the ford motor company. jim, everybody has been waiting for this, the first redesign of the f150 how critical is it for this truck, which has so many functional and useful features that you've added, how critical is it for it to corrennect to buyers >> very critical, phil it's important for the u.s. economy. no one builds more trucks in america than ford. we build all of ours here. its it's almost 1 million units. it's the u.s. most favorite automotive product and number one for more than 40 years huge for ford. >> reporter: so when you look at this and you look at pickup prices, full size pickup prices,

averaging around $40,000 at the same time is there going to be resistance how much more are people willing to pay for an f150 they start down closer to $30,000 if you are getting base model. if you are getting these loaded up you're going well north of 50,000, right? >> yeah, absolutely. you know, what we found, phil, is many of our trucks are used for work partially or fully, and it's a work tool in that case. people are happy to pay if the product is more productive now we have an on board generator, for example those generators cost $10,000 or more you don't need one anymore with an f150. you can power the whole job site it's an optional package it's a small portion of what an online generator would cost. we see this as content like we have with aluminum f150 with

more pay load and towing this is a content people want and they're more than willing to pay for it. >> jim, let's talk about inventory. adam out quoting a ford dealer anonymously in the northeast saying, look, i am not going to have enough inventory in order to stay open next weekend. i'm going to shut down on the 4th of july weekend, which as you know is one of the top two or three sales weekends in the u.s. how tough is it with inventory and why are you guys, according to this dealer, struggling to come up with enough of the key models like pickup trucks? >> well, actually, our production is up to essentially full capacity now, phil. this week was a really key breakthrough week for us in capacity and our production. we're in good shape across the country. we're about 75 day supply. it's a little bit light but compared to some of the competitors, they're out

we're not. helping our dealers move product from one dealership to the next and making sure we have inventory. we're open to business and we're in good shape for inventory. it is different dealer by dealer so we'll call around we'll get that inventory >> hey, jim. you guys give us the q2 sales next week. there has been a rebound especially coming off the shutdown in april for the economy in most parts of the country. do you expect that to continue in july and august or how concerned are you that as we see these cases flare-up, especially in the south and southwest, we might see a pull back in demand. >> it's too early to tell, phil. i mean, the retail industry has come back, as you said it's still lower than pre-covid levels we're planning our business at that kind of lower level but for us what's really encouraging we saw in june and we expect it to continue is recovery of fleet. not rental, but large fleet

deliveries government large oil and gas. companies like u-haul, we're starting to see that demand come back ford is number one in that market very important to our profitability. june really saw that business come from like 30% of normal to more like 45 or 50% of normal. that's an encouraging sign for us retail, too hard to call >> hey, jim. we've only got a few seconds here are we on track to see that electric f150 within two years >> you betcha and it is a spectacular product. a lot of attention on battery electronics. ours is built ford tough not anyone else can say that. >> there's a tease for you jim farley, coo of the ford motor company talking with us first on cnbc. thank you, jim i know we'll be talking with you more as you work towards that electric f150. this will be interesting because it is really heating up in terms of the competition

>> okay. phil, thank you so very much is there a vacuum cleaner? do we know -- >> oh, god lord. you've got a generator you can bring one of those little vacuums if you are worrying about vacuuming a truck when you're tailgating, something is wrong something is seriously wrong. >> these are the questions that happen in the sorkin family. we're having a conversation about a mini van in our family >> that's a different equation >> have a good weekend. >> you, too. >> i know, i know. the kids would like the pickup better than a mini van. coming up when we return, verizon becoming the latest company to pull its ads from facebook we'll tell you why the telecom giant is pulling away. new jersey governor phil murphy talking about the reopening in the garden state and what school can look like for your kids next year and new guidelines for travelers to self-quarantine

massmutual healthbridge is a free life insurance program just for healthcare workers fighting covid-19. learn more at massmutual.com/healthbridge ♪

calling on the social media giant to take steps to pull down racism and hate speech verizon saying, quote, we have strict content policies in place

and have zero tolerance when they are breached. we are waiting until facebook has a solution that makes us comfortable as is consistent with youtube and others. rei, ben & jerry's and patagonia have the antidefamation league and naacp's blessing to stop advertising during the month of july verizon is pausing its spending indefinitely now facebook's advertising -- and verizon is also the biggest advertiser of the protesting brands spending about $2 million between facebook and instagram in the last month. facebook's advertising chief saying in a statement, quote, we respect any brand's decision and remain focused on the important work of removing hate speech and providing critical voting information. now in an email everson sent

last week, she wrote, quote, boycotting in general is not the way for us to make progress together, we do not make policy changes tied to revenue pressure we set our policies based on principles rather than business interests. now everson stressing in this email to advertisers, facebook's making a lot of progress on these issues getting rid of 89% of posts that violate the rules. facebook is really trying to show advertisers that it takes their concerns seriously but also that it doesn't want to just fold to pressure. becky? >> julia, they can say that all they want, but if you see other big companies like verizon that step into it, do you think that behind the scenes this is having an impact at facebook? >> reporter: well, it's certainly having an impact in the way that facebook is reaching out to advertisers. it's not just this email that i obtained i know that everson, sharyl

sandburg have been calling many people across the industry, brands, agencies telling them they take these concerns seriously. i think part of it is showing how much they feel they've already accomplished in terms of how much hate speech they're pulling down i think it's possible we will hear more from facebook, either about how they're trying t improve diversity internally, which they've been talking about, or how they're going to be more transparent about what it is they're taking down. this is definitely something they're watching it will be interesting to see if anymore really big advertisers join in this boycott in the next couple of days that's scheduled to start on the 1st. >> julia, thank you. good to see you. when we come back, new jersey governor phil murphy joins us live on the garden state's reopening process and that new travel advisory for people arriving from virus hot spots in new jersey, new york, and connecticut. stay tuned ghhe ocn" tching "squawk box rit ren bc n 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. i'm an associate here at amazon. step onto the blue line, sir. this device is giving us an accurate temperature check. you're good to go. i have to take care of my coworkers. that's how i am. i have a son, and he said, "one day i'm gonna be like you, i'm gonna help people." you're good to go, ma'am. i hope so. this is my passion. if i can take of everyone who is sick out there, i would do it in a heartbeat. for as little as $5, now anyone can own companies in the s&p 500, even if their shares cost more. at $5 a slice, you could own ten companies for $50 instead of paying thousands. all commission free online.

schwab stock slices: an easy way to start investing or to give the gift of stock ownership. schwab. own your tomorrow.

welcome back about half a minute away from personal income and spending data for the month of may and a

new look at core pce prices. the futures are about where they were nasdaq just barely hanging on to a fractional gain while the dow is down triple digits. down 143 points. s&p off 6. 10-year note -- santelli, oh, devilish 666. rick santelli. rick, the numbers please >> reporter: yes our may read on personal income and spending we know the spending accounts for 2/3 of the economy consumption driven economy and what we're waiting for, of course, is -- ah, here we go minus 4.2 on personal income minus 4.2. if there is any good news here, i guess the good news would be that minus 4.7 is the all-time low going back to 1946 we didn't quite challenge that the worst feature is we're having the back-to-back issue.

the 10.5 for this time still unrevised. last time was all time high. we go from all time high to all time low on spending, in any states that are partially reopened like parts are where i live, it's like stores can't keep inventory. 9.3 expected, 8.2. bit of a disappointment but it's still of a whopper of a number on spending. 8.2. the all-time high going back to 1959 is only up 2.8. we just kind of blew that record away once again, it is following a 12.6 that is the worst ever. so the same dynamic in reverse with income. on the year-over-year issues we really want to pay attention to on the deflator, it is up half of 1%. the reason i find that important is because we're trying to all handicap what the world of inflation, deflation is going to

look like as we get through coronavirus. yields, yes, 66 basis points what's interesting is that most maturities outside of 30 year bonds. there's settlement yesterday and friday were the same we are down on the week and down on the day on all maturities maybe the most depressing news that i think the fixed income sovereign market is sending everybody is that with yields so low, so close to all-time low closing yields it isn't instilling confidence. you can say what you like about rising rates, but rising rates in the current environment we're in, even acknowledging that the fed could squash any rise in rates it wants at any point, i'm not sure that's their desire, but that would give us a little bit more confidence. of course, that needs to be paired with an equity market that seems to get its sea legs back we'll have to pay attention if it could turn into green today becky, back to you >> rick, thank you very much >> go ahead, joe >> trying to say the stock market, it would be better if yields were higher

okay that's all, beck is that right, rick? have i got -- that was in summary for a friday i heard you say desire >> yes yes. >> you didn't say hier >> yes, you have it right. to get our moods higher. to get the economy higher we want stocks and interest rates higher >> now he's on a roll. >> everybody get back together and play a little baseball in the future, huh? >> 60 games maybe, cubbies. >> see ya. beck >> thanks, joe we are now going to get an on-the-ground look as the economic recovery is progressing as states embrace phased reopenings we welcome governor phil murphy from new jersey. he's been watching his state open up after four long months thanks for being there --

>> i'm still recovering from joe's mariah carey impersonation so please bear with me >> we're a little goofy this morning. it's friday. it's been a long four months for all of us. we have been talking today how when you get out there you really start to see people back out in restaurants again, going out shopping, out at beaches and at parks and i just wonder, as you watch this if you worry that we're going to see a rise in cases and what numbers you're watching, how you're measuring this to decide if we're doing this the right way. >> yeah. first of all, seriously, it's good to be back with you, and we do worry, which is why we've been taking this in very specific phases in terms of reopening. outdoors is a lot less concerning than indoors. that's not to say there aren't concerns outside, but the concerns pale in comparison to say, inside, lacking ventilat n ventilation, sedentary, close

proximity. those are bad characteristics for this virus the things we look at most closely in terms ofour guides are rate of transmission if it's under 1, that means less than one other person is getting infected if they're in contact with someone who has got the virus, the spot positivity rate, meaning what percentage of folks getting tested are actually positive for covid-19 and, thirdly, is new hospitalizations those are the three data points. we look at a lot of data but those are the three that matter the most >> we have seen things get a little out of control in states like texas, florida, arizona, even california you're starting to see some real pickups in these things earlier this morning we spoke with dr. scott gottleib. i know you're familiar with scott and you know him well. he said that contact tracing is not being done very effectively in a state like texas. they don't know why young people there are getting it or where

they're getting it, if it's from bars, if it's from being outside, if it's from anything they've done at parties and a lot of places. it's a lot of guesswork. how prepared are you in new jersey in terms of contact tracing to try to figure out if there's a spike in cases, where it's coming from and why >> yeah, i can't speak to the specifics of texas scott is a great guy and has been a great advisor, a jersey guy, by the way. we have said since day one, remember, none of us said any of this at the beginning. if you're looking for a source of comfort or silver lining, it's testing, tracing, plans to isolate folks who have the virus. we had none of that as a country or as a state three or four months ago we now test in the top couple per capita states in the nation with the great help of rutgers, our flagship state university we're adding meaningfully to the already 900 contact tracers we

have we hope to get up over 2,000 within the next couple of weeks. i hope and believe that our approach will be effective again, our numbers have gotten notwithstanding the loss of over 13,000 people, it's hard to believe we've lost that many in new jersey alone, our numbers have gotten dramatically better. so we've been able to do the contact tracing up until now at least with local and county tracers. we have 900 of them on the field. so far so good, but we want to make sure we've got a capacity that looks like our testing capacity just in case, and i think we all have to be prepared for this we hope for the best but prepare for the worst that this is going to flare-up and we need that tracing infrastructure in place. anecdotally, again, it's far more concerning inside than outside, at least in new jersey. i can't speak for texas. that's where our biggest concerns are >> governor, you have a press conference later today to talk

about the schools and a plan for getting the schools ready for fall do you think the schools will open in september? >> i do. i do, becky. we want them to, and i do believe they will. again, you can't -- you know, we're a couple of months out so imagine predicting in late april what late june will look like in america. probably none of us would have gotten it right, good or bad so with that big caveat, two months out i believe we will be back in school it will be a new normal. there will be protocols in place that have not been in place before, but as good a job as our state did under really challenging circumstances in terms of virtual learning, there's an enormous desire and appetite from educators, parents, kids to get back to school, and god willing, that's what we will do. >> how do you do that and properly social distance is the school day going to look the same will the kids be there together?

or are you looking for other places to try to house students? how are you proceeding >> we'll get into that in a fair amount of detail this afternoon, but it will be a combination of some of those very things. there will be obviously a big emphasis on social distancing. the hardest nut to crack, we've seen this in long-term care, we've seen it in society generally, is the asymptomatic, healthy young person unwhitingly passing the virus to someone who's in an older generation and/or someone with other underlying health issues and that's the one that we've got to be most cautious about again, we'll get into that later on today >> how does that play out just in terms of sports because for high school sports, a lot of those practices start next month and well into auk watching how we've seen some of the concerns that have cropped up with college football that's already back practicing and some of the coronavirus spread there, do you have a plan for that?

>> well, we started non-contact sports this past monday in termgs terms of practices. we are going to go live with games and there will be a great basketball tournament called "the last dance" which will mimic what would have been a high school tournament in the state. we've got to do it carefully though all of this is -- you know, we've got to take incremental steps. this is a virus that no one knows anything about, even the experts like scott and others. we're learning as we go, and we've got to -- again, the benefit of being incremental is you can learn more easily from a given step that you've taken and sports will be no different from that >> governor, watching what's happening with the travel advisory, that you along with the governors of new york and connecticut are putting in place

now for anyone who visits or comes from a state with high transmission, they've got to quarantine for 14 days when they come back to one of these three states is that pay back for what florida was doing before, for what rhode island was doing before how do you actually enforce this president trump says when he comes to new jersey to his golf club it doesn't apply to him because he's not a civilian. how will you be out there enforcing this >> we had a little bit of a different take than the president, but there is a carve out for any essential workers and he is an essential worker. the president is welcome, obviously, in new jersey no, this is not pay back at all. by the way, we wish nothing but -- we pray for florida we pray for any of the other states that are having outbooks that they please, god, are able to get to a better place as fast as possible. it is very simple. we have gone through hell. as i said, new jersey has lost

13,000 folks, new york more. connecticut a huge number. none of us want to go back through that hell again if we can possibly avoid it. what we're asking is for folks to do the right thing. personal responsibility. if you know you've been in a state with a high positivity rate or a high number of new cases, do the right thing. come back. self-quarantine and get tested you know, in new jersey, as i mentioned, we have built a testing asperatus unlike any american state let's use it if folks have been in a highly infected part of the country, let's get them to get out and get tested be by themselves let this period run through and, again, do the right thing and be responsible. we call it common sense for the common good, not just for yourself or your family but for the community at large >> governor, i just wanted to ask you about the voluntary approach to all of this and the idea of common sense and,

frankly, i think if we're being honest with each other, there's been a lot of common sense that has not been used throughout this pandemic around the country and that's one of the reasons we're in this mess and situation we're in the reason i ask it or the reason i raise this question is to the extent there are going to be people coming in from states that are high risk, in other countries, and we can talk about liberties and freedoms, but in other countries if you were going to have people flying in from florida rather than do a 14 day quarantine, you would test them on the spot when they landed at newark you would test them and then you would trace them and it doesn't seem like there's any actual procedure or mechanism to do that it doesn't even seem to be a tracing americanism for people flying into these places people can drive in from other places i know, but why aren't we being more stringent about this? >> listen, we don't have the constitutional ability to put roadblocks up on our borders as you rightfully point out i would just say this. common sense and personal

responsibility have actually overwhelmingly been the words that have defined how new jersey, and i know new jersey the best bein, obviously, has performed over the past three months we've asked folks to stay home they've stayed home. we've asked them to keep social distances, they did. we asked them to wear face coverings when they go out, they wear them, particularly when they're indoors. wash your hands with soap and water. this is yet another ask of ours. and, again, it's a lot of responsibility we get that. folks have overwhelmingly done the right things and i believe they will continue to. it's not a hard one, right you know that if you've been in the state with a high level of infection, you know you've got to say, okay, i get it i'm going back in, too i don't want this to get into my family or my community i'm going to do the right thing. folks have done that i have -- we put a lot of faith in our folks so far it has paid off

have there been knuckle heads? folks who didn't comply? of course. overwhelmingly folks have complied we wouldn't have the numbers today which is among the lowest rates of transmission, among the lowest new hospital rates in america if folks hadn't done the right thing, and i believe they'll continue to. >> governor murphy, thank you for being with us this morning obviously we're watching this state and every state very closely as this proceeds, but we appreciate your time today and we'll talk to him soon again, that was governor murphy from new jersey. andrew >> thanks, becky. coming up, is the aviation sector about to get another federal injection of cash? that is the question coronavirus still weighing heavily. unions representing tens of thousands of workers are calling for billions in new aid. we'll bring in the details on that next. as we head to a break, check out shares of nike dow component missing estimates badly on both the top and bottom

lines for its latest quarter with sales hurt by the lockdown related store closures stay tuned, you're watching "squawk box" right here on cnbc.

in peytonville, there's lots of ways to save on auto insurance. really? yeah. very proud of that. with smartride® from nationwide, they can get discounts for safe driving. does she get one? mrs. carmichael? safest driver in peytonville. takes a lot of work and effort to be the safest driver in peytonville. what about this guy? with nationwide smartmiles®, the less he drives, the less he pays. the list of inspiring stories goes on and on. i bet. i've never seen anyone do more with their retirement... ♪ ...than you. i... concur.

welcome back to "squawk box. red across the board nasdaq has turned negative down two points this will be a down week if we were to end this way the second -- the last three weeks have been down weeks the dow is indicated down 165 points and the s&p indicated down about 9. toss it over to my knucklehead friend you notice when i'm noticing, andrew, knucklehead is making a comeback it's old-fashioned. >> it is old-fashioned. >> cable ready i was talking to the producer about all of the words that are not cable ready that it replaces have you thought about it. i'm going to start using it.

it's gentle. knucklehead. for people on the air, if you're groping for something and you don't want to have an hr problem, what is a knucklehead i'm trying to figure that out. this is -- i want to hear -- let's start using that if we are ever mad at each other, i'm going to say, knucklehead. >> knucklehead >> knucklehead. >> i'll use it we'll use it a lot >> we may need more than one, but i like it. and i like the governor. >> let's -- let's talk about retail for a moment because gap shares are jumping on news that the retailer is teaming up with, ready for this, guys, kanye west in a multi-year partnership. he will create an easy line of clothing aimed at young shoppers they will receive royalties and equity they say the brand is valued at $2.9 billion and, guys, this

could be a big bet for the gap, you know it's arguably had a fallo period and maybe kanye will bring it back >> wow you know, kanye, the kardashians, this is like when cody was up 16% on news that on, was going to be getting involved with it, too 16% is the basic improvement in market cap if you get involved with the kardashians or with kan kanye? >> i mean -- >> well, look, you could argue, by the way, what he did for adidas even. i mean, if you think about where adidas was probably a decade ago now before yezees and the ascension of that brand, could happen to the gap. we'll see. >> could use it, yeah. >> yeah, it would be something to watch also, guys, some worrying news for the housing sector the number of borrowers delaying their monthly mortgage payments because of the coronavirus rising sharply data and technology firm black

knight says that active forbearance plans shot up by 79,000 in the last week, that erases roughly half of the improvement that we have seen in those numbers since they peaked late last month. as of tuesday about 4.7 million homeowners were in forbearance plans or about 8.8% of all active mortgages that represents $1 trillion in unpaid principal mean time, there are new calls for billions of dollars in aid from unions representing tens of thousands aviation workers. phil lebeau is back with us and joins us with the details on that phil. >>en a drew, this is a letter that has been sent by the representatives who lead six airline and aviation unions, we are talking about the pilots, the flight attendants, the ramp workers, so many of these union workers who have had their jobs guaranteed through september 30th will not have those job guarantees come october 1st. as a result they have written

members of congress and they have said, look, with he would like you to extend that payroll guarantee through march 31st now, the amount they are seeking is not clear in the letter, but they seriously believe that they have a shot at getting washington to provide another airline bailout. i'm not sure that's going to happen when the first one came around everybody said, well, this will tide the airline industry over until we see demand in travel come back and many people early on thought it was going to snap back this summer take a look at the latest passenger levels, we just got this from the tsa, the most recent level is 326,000, that's down compared from where the airline friday was the index had a little bit of a come back three weeks, four weeks ago. it has basically flat lined there at the level you are looking at they have increased their debt borrowing, the airlines have they have now borrowed more than $40 billion in order to get the

airlines through the next couple of years and part of their equation right now is if traffic doesn't come back, they are going to have to cut payrolls substantially. come october 1st that's why you have the unions, guys, going to capitol hill saying let's have another round of payroll benefits extended to the airlines which would likely be for billions of dollars as i said earlier there is not going to be a whole lot of appetite in washington despite the importance of the airline industry a lot of people look at it and say we gave it to you once, i'm not sure we want to go back to the well and do it again. >> phil, what about the appetite just from the airline executives themselves, are they on board with this or is really this coming from the union saying -- >> this is coming from the unions this is coming from the unions. >> and what have the executives said about it? >> officially they will sit there and say it would be won r wonderful this congress would help us, unofficially airline

executives said, look, it was a herculean task to get washington to give us a bailout back in march and in april i'm not sure they will be on board again. how much political capital do you want to spend trying to get that to happen they don't want to lay off people but at the same time they realize the landscape that is out there politically. >> yeah, and not to mention that every time the bailout money comes it comes with a lot of strings attached. >> yep. >> i think the executives are not fond of. >> exactly. >> okay. phil, thank you. we will continue to watch. >> you bet up next, we will tell you what to keep an eye on ahead of the opening bell on wall street. we've been watching the futures this morning and for most of the morning the dow has been under pressure, all morning, it's down by 180 points, s&p futures down by 10.5, the nasdaq is indicated down by about 10 points as well. it is friday stay tuned, you are swachg "squawk box" on cnbc is a time for action. so, for a second time we're giving members a credit on their auto insurance.

because it's the right thing to do. we're also giving payment relief options to eligible members so they can take care of things like groceries before they worry about their insurance or credit card bills. right now is the time to take care of what matters most. like we've done together, so many times before. discover all the ways we're helping members at usaa.com/coronavirus

half hour from the opening bell on wall street joining us now is paul zem ski, cio at voi i can't investment management you have about three minutes, a little bit less, paul. so you favor stocks over bonds, we just had someone say bonds got nowhere to go and it shouldn't be hard to figure that out when we are range bound almost down at zero. so stocks look good, but what about the move that they have already made you don't think a huge pull back is in the cards, you think 2,900 would be healthy or normal. >> absolutely. i would be a buyer at 2900 the market is getting a little spooked by what's happening with covid, that's the rise in cases, i think that's perfectly natural. i believe that we're not going to see wholesale shutdowns of

economies anymore, there will be regional hot spots and that's giving the market a little spook. we could easily trade off to 2900, i think we will see buyers here, i think a lot of people missed this, it was a rocket ship up from the lows and he think a lot of people would like to get back in >> you might buy some high yield or investment grade corporate bonds or maybe some cyclical stocks, that might be part of an asset mix? >> absolutely. i'd be buying corporate bonds here i don't think you need to wait to buy corporate bonds there, you're still getting 2.5% yield on a ten year triple b, inflation will be zero to one so you're getting a nice real yield and the fed is on your side. the fed is doing everything they can to keep the corporate bond market stable. fed has your back and that's also going to help high yield as yields come down in the investment grade market, people will buy high yield bonds and that will be supported as well. >> for risks you mentioned that covid could be more serious than what you're expecting, you also

mentioned the election >> yeah. >> what do you think -- how does that play out, do you think? >> well, you know, in the polls you see biden doing better if he was to win and there is a good chance the democrats take the senate i do think we will see reversal of tax policy, less favorable for corporations, profit margins will be hit so that is starting to be priced in by the market but it's really not fully priced and probably won't be until after labor day it's really going to go biden's way. that's a risk, but i don't think it's front and center right now. >> do you think in some of the parts of the world that had the virus earlier you're seeing what may happen here and it's positive to you what's happening in europe at this point? >> yeah, so europe, you know, we were very worried about europe, given their -- they were late to the policy table, the ecb was late to ease, late to bring fiscal stimulus. you look at the purchasing manager indices that came out earlier this week and europe is in a v, too.

europe is bouncing back, great to see i still think the u.s. markets will do better than the european markets but they caught up this month. europe is up while the s&p is flat. >> paul, thanks, we will appreciate it. becky and andrew, happy friday great weekend. we will do it again. >> happy friday, guys. >> we will -- >> do it again. >> four-day weekend -- i mean four-day week next week. >> what malarkey will we talk about next week? trying to use an old word. >> i wish we knew going forward. "squawk on the street" is next going forward. ♪ good friday morning, welcome to "squawk on the street," i'm carl quintanilla with mike an tolly, morgan brennan coming to you live from various locations. futures south of the flat line once again as the market digests bank stress tests, another record high in u.s. covid cases, that earnings miss at nike and we will get a russell rebound into the close oil is hanging on to 38.