except for the slight move lower. roll backs continue. california, michigan, pennsylvania, parts of florida adding back restrictions companies like mcdonalds and apple are halting or reversing their plans. four tech ceos have agreed to testify the latest on the crack down of big tech companies thursday, july 2, 2020 "squawk box" begins right now. good morning welcome to "squawk box" here on cnbc i'm becky quick with joe kernen and andrew ross sorkin we start with the markets. the dow pulled back.

starting the quarter with gains. the nasdaq was up more than 1% by an all-time high. s&p was up half a percentage point. the dow was up slightly. a decline of about 0.3%. burke buckle your seat belts a lot to come. we have been watching what is happening with the futures at this point, all three in the green. the dow up almost 200 points all coming before the big jobs report the last trading day of the week before a long holiday weekend for the 4th of july. you could see some activity happening here a quick look at the treasury market you'll see right now, the 10-year looks like it is yielding 0.676%. it is that jobs preview people are waiting for to get a sense of what is happening in the economy. >> let's bring you the preview

maybe not the numbers itself but get ready for them markets in the u.s. are closed tomorrow in observance of independence day today is jobs thursday forecasters expecting an addition of 2.9 million nonfarm jobs in june unemployment rate expected to dr drop calling for 1.38 million new filings which would be a decrease from last week's 1.48 million more expect predictions at 6:30 a.m. about the runup liesman wasn't doing his models because it is almost too hard to model out. >> people like his new fireside

chat nothing to fear. it is very calming if someone says, steve, how about playing us a tune. >> he can reach right over and grab that guitar >> did someone say -- it is possible if the leis maniacs ask for that, we have to decide, do we want metal, dead, folk rock last time he was on, he did "the wait." >> it was paula abdul. he sang for her. >> that's right. >> when she was still judging. >> i think she said, you are an economist, right

♪ ♪ take a load off annie >> she was very complimentive. >> he didn't have backup he didn't have a base or drums >> i love steve's voice. >> not friday but it does feel like a friday. three-day weekend. let's talk about the house house of representatives voted to extend the deadline for paycheck protection program until august 8 it goes to president trump for his signature. could be a crucial lifeline for businesses now facing new shutdowns as some states roll back reopenings. president trump said he supports not only wearing a mask but also another round of payment to americans. he said he supports larger payout numbers than democrats

proposed we'll likely hear more about this extension will frost has an interview with mike pence at 10:00 a.m. coming up ceos from four tech giants, apple, amazon, facebook and microsoft have agreed to testify. that probe is expected to produce new legislative proposals to try to reform and regulate the digital marketplace. hearings could take place later this month and not clear whether it will be in person or by video. this will be the first testimony for jeff bezos i think tim cook was the last to agree to this if what i read was correct. >> i think it was

it will be interesting to see who gets the focus will it be zuckerberg or someone else who will be outspoken apple or alphabet. will be must-watch tv. we'll see. in the meantime, protests we talked about yesterday after the security law taking place. 370 people were arrested yesterday. 10 were arrested under the law law that criminalizes succession, subversion and collusion with foreign forces.

those charges could carry a term of life in prisonment. at minimum, three years behind bars and 10-year minimum for principal offenders. it is unclear how long they'll apply that law we'll see if they transfer those prosecutions to the chinese. the united kingdom offering a path to citizen for 3 million. calling the new security law grave and deeply disturbing. and talking about the role of the united states in all of this and the pandemic not that we've taken our eye off the ball but that we don't have the bandwidth to deal with this and maybe the chinese are taking advantage of that. >> in combination of how big the

protests were yet and what you just talked about, the intersection and when those two meet, that will play out they don't have the room every person that just shows up. china builds a lot of stuff they will never use i guess they have a lot of those. they are talking tough i understand how that works and trying to dissuade people. how do you follow through on that if you don't follow through it, no one believes it >> wasn't that one of the biggest protests to date that punishment staring you in the face you said the last week of july that is like tomorrow, andrew. we should be ready for that like

tomorrow morning it is july, do you realize that? >> july. july 2, i believe. >> why does time go so fast when you are not doing anything i thought was supposed to crawl when you are at home >> because we are older. trust me, our kids thinks it crawling by from home. >> one year is a sixth of your life >> they are also chomping at the bit. they want to get back out. i'm pretty content to stay home. >> i know. everybody is together. not away at school i think there will be a time when we look back and not look at it positively but just say wow, nice to have the family >> cherish the silver lining >> i had two german sheppards

literally -- i can't save you. they are looking at me like. i can't save you why don't they learn that thunder is not going to hurt you? it is weird but there was like 200 pounds sitting in my lap when we come back, as the states are rolling back restrictions, companies are now reversing plans to reopen in some areas we'll update you on latest moves from apple and mcdonalds after this take a look at shares of tesla a broken record rising after musk congratulated employees on performing they are set to share the latest later today. up 4.5%. "squawk box" will be right back.

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welcome back to "squawk box. california and arizona reporting record cases california said some cases were confirmed earlier but had been left out of previous tallies due to a backlog of local health departments. california ordering restaurants to close in los angeles, orange, santa barbara counties in arizona reporting higher cases with a lag stating capacity was 90% occupied. requiring residents to wear masks when they leave their homes. the seven-day average there is up florida miami dade now requiring face masks in all public spaces.

michigan will not allow in-door seating in restaurants and bars but will allow out dodoor seatig >> mcdonalds pausing reopening plans for 21 days. the company is going to wait three weeks, it says here. what do you think of that? how quickly we came up with that you know the 21 days is confusing. in case you didn't know, three weeks before any new u.s. restaurants add dine-in service to the currently operating drive thru and take out delivery locations. about 2,300 of the 14,000 stores currently allow customers to eat

inside that's a set back, obviously the market was up on the day a few weeks ago. people said apple is very cautious remember they closed a certain number of the apple stores now, this is just more from apple. today, the market not taking it or at least taking it in stride. reversing course, the company plans to close an additional 30 stores including several in the los angeles area that brings the total to 77 reclosed stores out of 271 that had reopened was it in the teens? like 19 or something that was at kind of a stark data point. a couple of weeks ago that things were not preceding quite as smoothly. you know what, i know, andrew,

you like hang out there. if you've been to an apple store, it is hard to social distance >> family tables are crowded >> amazing >> we used them as a bell weather back in china too. we took that and starbucks kind of as a serious sign you may not believe what the chinese are saying but if you have those companies opening up there, they must feel confident. that's why we use companies like this, no matter what you are hearing from government officials, those companies are cautious with their own employees too. >> we'll talk to scott joining us now dr. scott gottlieb former fda commissioner, also cnbc contributor and serves on the boards of both illumina and

pfizer great to see you we didn't get to talk to you about that pfizer news yesterday. as a board member, were you aware of those results before they came out or did you find out like the rest of us? >> no. the board had been briefed i'm careful not to talk on behalf of pfizer but they are very committed. the company has made a very big commitment to trying to develop this vaccine >> the reason i ask, not to get too specific on what is happening but from your own perspective because you have been concerned about the rise, did what was announced with those results change your perspective over the longer term or shorter term about what is happening right now? >> look, i think the results are consistent with results we've seen from other vaccine con instructs in that they indicate

developing this vaccine for the virus. there is a long way to go. we have to put a lot of vaccines in the hands of patients we've seen a number with the ability to generate immunoaga immuno-genicity. pfizer, merck, sonofi, johnson and johnson is in it the four major companies are trying to develop the vaccine. these are not only developing the con instruct bstruct producing those, scaling them. that is something the big manufacturers know how to do

they are in this game. they are all chasing it and trying to develop the vax everyone i'm confident we'll get a vaccine but i think it will be late 2020, early 2021. we really need more than one manufacturer be successful here. i would love to see pfizer cross the line but we need more than one manufacturer to bring it to market we have a big task immunizing the world. >> i think it was you or one of our smart people who favored the pfizer vaccine you point out that that has the ability to generate cell immunity t cell immunity. is there a way that you can measure for that do you know, the studies that they are releasing yesterday can

indicate that type of immunity being generated as well. do we need that to get an effective vaccine? >> that is mrna. j&j is working on it, astrazeneca, merck it is not easy to test for t cell mediated immunity this will be revealed in the clinical trials. we'll see how effective they are. if they do generate a cell-mediated immunity, that would protect. the fda put out guidance saying the vaccine would have to be 50% effective to clear the huddle. i think they'll have tho relax that and get over that hurdle.

some won't keep in mind the flu vaccine was over 30% effective that might be a pretty good product. there will probably be more than one vaccine in that early hurdle to the data when used in generating antibodies. >> i don't know if you saw this hashtag that said schools over bars meaning we need to priorities getting kids back to schools before getting folks back in bars what is trending with that is two competing studies. one out of geneva that showed that kids actually could spread covid.

i think it was 23 or 24 kids that had covid there was another study a week ago out of france suggesting that kids can't transmit it nearly as much >> where do you land on that and why is science not clearer >> kids can spread covid but the question is can they spread it as efficiently as adults most of the data says probably not. they can get it and they can spread it. part of the challenge is that we haven't done good studies in children part of the problem is we are not testing children even now in the united states, children don't get tested. under 12, you don't get tested in florida under 16, you don't get tested in some of these drive-thru sites. the first thing we did and every

other country did was shut their schools. it may be we've protected the kids and this hasn't been a high prevalence in children it could be that they have been underexposed that is what happened in israel. they reopened against the back drop of a little bit of spread nothing to suggest that the kids or schools are impreferious to this looking at the example of the way flu does every year. >> to that point, i've been feeling bad i'm keeping our teenagers at home. they are telling me about how all their friends have been out. i saw a story about in one of the cities here in rocklin

county, there was an outbreak that traced back to a house party and the host had been a symptomatic. they are refusing to help with contact tracing because they didn't want to get anybody in trouble. what do you think of that? >> there has been other reports like that. i wouldn't be going to or hosting parties for young people your kids can start socializing again. mine have. we've kept a small social circle people we trust. i wouldn't put them into a large

setting until this has passed. we'll have another six months of this, another two months relatively here. things will be okay. things will heat up by september. things will be over in january with a vaccine or with spread enough we have a short period of time to get there we should do everything we can to preserve our way of life through that time and get through it >> college sports, we could also talk professional sports adam silver still pressing ahead with his plan. there seems to be a little hesitation with the spread they are seeing in florida. then you had a doctor come out saying if the ncaa were to play football this fall, somebody would die, was the comment made. would you play basketball or football or see it differently

>> i've talked with the nba. i'm not working with them but had conversations. i think the professional teams can play because they have good plans for protective bubbles they plan to put around the players. the question is for the nba, do they want to play in florida against the back drop of death and disease there. they may need to pull out. the optics of that playing a recreational sport in that setting. college sports is another matter they don't have the resources to create a bubble around players as you move down from professional to college to high school, it is increasingly more difficult. it seems like we'll have epidemics and will have epidemics at this point. >> huge implications for those

businesses >> thank you we'll see you back here next week we appreciate your guidance and counsel. andrew thank you. coming up, when we return, new comments from st. louis fed on the potential for a financial crisis we'll talk about that after the break. as we head to that break, take a look at the biggest pre-market losers and gainers we are back after this your ner 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.

welcome back time now for the executive edge. fed's bullard warns of a financial crisis warning it is possible for the u.s. to take a turn for the worse but added that it is not his base case he said it is important to keep lending in place for now even though liquidity has improved dramatically james bullard has been with us many times and probably one of the more optimistic over time about how quickly things would

return saying he thought the third quarter would be it. we are now in it, so we'll see >> we'll see if you saw the whole interview, he said not his best case scenario >> not his base case he's been very optimistic. i guess if bankruptcies were accelerating, you could see if that was possibly going to kid around about that. a sharp selloff in the futures

up 187 points this morning ahead of the opening bell you would never know what could happen especially on an important day like this. claims too payroll and claims we might play "friday, i'm in love." i'm okay with that i'm so excited about the next three days we head to break looking at the s&p 500 winners and losers you're first. first to respond. first to put others' lives before your own.

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good morning, equity futures up just over 200 points. nasdaq has been a strong market. new highs again yesterday. up another 41. s&p indicated up 17. waiting for the june jobs report report is more uncertain after hours. joining us now to preview the data chief u.s. economist, and cohead of global economics.

i'll start with you, what is the headline number going to be with how you see things >> a stronger than expected. the forecast around these numbers are incredibly unprecise. we do expect you'll see more evidence of rehiring as economies have reopened. it sounds like a big gain. we are still looking at less than half of the jobs loss from the real hit there is a long way to go. it would be encouraging to see the progress we saw with the other data with ism or car sales numbers that the economy is picking up. >> now that you've broached the possibility of 7 million jobs,

will people look at that and say, my god that is great. that would be a number on face value. i was talking about how we are media after all. the media would say, my god, that's the most ever that would be a big number to see. >> that's probably going to be the takeaway i think about how the market reacted to the gain. clearly a huge surprise to the upside in progress to the loss over the last couple of months, that was a little less enthusiastic we toin see the rise in data the pending home sales numbers, record gains there is confusion between levels and percentage changes. sharing the signs we are seeing

a rebound. large percentage bounces or increases in payrolls have to be seen where they are well below the prices it is important to keep in mind the whole level changes aspect as we move through the numbers >> can you give us a number we can beat, please do you think we'll be at seven or do you have a lower number? >> we are a little bit moderate compared to that forecast. we have a little more than 4 million. 4.3 million. it fools odd to be precise even with the decimal point, as you pointed out. estimates range from half a million to 9 million from the market perspective,

anything 3 million or higher would be seen as reason to heal. the rebound is unfolding as michelle pointed out, this is the initial bounce once you start reopening many states economies, you expect this type of bounce. the real question is where do we go from here the initial jobless claims starts to reopen the spotlight from payrolls this morning what we know from the alternative data, high frequency data will be that maybe hiring was strong through june. through the end of june, it looks like we've levelled off. some of the reopenings, as you know, have been reversed >> that was my next question the last three weeks have been different than prior to that

with some of these reopenings pulling back is that relevelled with some of these places reopening. why it could be strong the number of reclosings we've seen, is that increment al in your view? can it get there >> what i think it does is slow down the pace. there is plenty of space and activity of the slow down of the shut down that could alter both businesses and consumer behavior even some of the governments are starting to mandate some slower reopening or reversal.

>> what do you think, at this point, it won't reverse but will it slow? >> skanexactly. it will make the rebound more than expected. even if it is not the restrictions put in place, i don't think anyone thinks we are going back to blanket restrictions what we are seeing with mobility numbers. we are seeing social zarnsing increasing as consumers are less inclined to go out i do think it is a reminder that we have a lot to talk about, this rebound is likely to increase cases pop up you have shut downs. this isn't a straight line back up as you look ahead, it's likely they won't be as robust as some

of these june numbers will be. >> appreciate it seven plus four is 11. i'll go with 5.5 how is that? not everyone can do that i was off camera with my calculator thank you, both. when we come back, getting back to school, colleges making decisions around on campus learning in the midst of this pandemic we'll talk to the president of one ivy league school advocating for in-person classes. a look at leaders in the dow today as it often is right now indicated up 2.1%. pfizer also up 2.1%. we'll be right back.

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welcome back to "squawk box. we are in the green across the board. double digits on the dow up 215 points ahead of that jobs number when we come back, colleges are divided on the fall return my alma matter making the case that it is safer to return students look at this, giza pyramids reopen they spent the last months on

restructure. look at those images we are back after this when the world gets complicated,

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welcome pack back to "squawk box" this morning. take a look at u.s. equity

futures. we are still about an hour and a half away from the big jobs number today this may move around depending on where we land green across the board right now 217 points up when it comes to the dow. the nasdaq looking like it will open up about 43 point higher and the s&p 500 looking like it would open up about 19 points higher right now meanti meantime, want to talk about a very ambitious plan that's in the works about covid and schools. so yale yesterday announced that it plans to hold most of its classes online next semester it said students who do not attend classes on campus will be tested weekly for the coronavirus. cornell university is making the case that on campus instruction is the safer alternative, the university's president making that argument in a wall street journal op-ed this week. joining us is martha pollock the president of cornell university. thank you for joining us

we all read the op-ed, we all read the email when it came out to us alumni it's an interesting argument to make tell us about the math that was behind the decision that it's actually safer to have students in class than to have them off campus which i think was really the argument, skyping in or zooming in to class. >> sure, and i want to be clear, it's safer for our students at cornell. we did the study with regard to the conditions here at ithaca. it does not necessarily apply elsewhere. basically what we know is up to about 50% of our undergraduates plan to return to ithaca regardless of whether we're online or having face-to-face classes. they've told us that through surveys and we have spoken with local landlords. and the issue is that if we are having residential instruction, we can mandate testing testing and tracing and isolation on a very aggressive regular basis. we will be much less able to do that with students online who

happen to be living in ithaca as opposed to chicago or atlanta or wherever. >> right martha, let's talk about this testing and tracing plan it's ambitious, it's aimpreggre and perhaps could be a model for others, not just universities. you're going to be doing what's called pool testing. how frequently is that testing going to happen? >> the plan is to test every single student once a week originally for the first test it may be the nasal test you see being done all over the country. that would be very unpleasant to do every week. after that we will be moving to cheek swabs or saliva or something in the front of the nose it will be done weekly and done with a pool test with tool tests you take groups of ten samples you mix them together and do one test if that test is negative, the whole batch is cleared

if it's positive you go back and use the samples you saved and do individual tests on each of those people that obviously saves a lot of costs. the fda has just put out guidelines using that kind of flu testing. >> martha, what are you going to do if somebody has covid, and how are you going to prevent the house parties we're seeing all over the country already now in ithaca from taking place and potentially spreading this >> those are two different questions. obviously the whole point of testing is so that you can catch the infection early and then do contact tracing and you can quarantine and if someone has covid do isolation it really is the classic public health triad for controlling communicable diseases. you test you contact trace, and you quarantine or isolate. as far as parties go, look, we're not naive. we know that we're not going to be able to entirely control student behavior students are students. they're 18 to 21-year-olds they're young adults we think we can influence it to some extent.

we're going to have an extensive public health campaign we're going to work with student leaders on bystander intervention, which is something we use to help prevent sexual assault. of course we do know that there will be parties. there will be violations two things, one is we will have a series of escalating interventions. you forget your mask, we're going to remind you to put your mask on. if you continue to misbehave, we will have escalating steps to try and get you to behave according to the behavioral expectations for the campus. secondly, it is the use of this very aimpreggressive very frequ testing that we hope will enable us to capture infections and quarantine and isolate people early enough. >> are you going to be setting aside space to quarantine students i mean, i hope you're not going to take my beloved statler hotel and turn it into a quarantine hotel, but -- and the other

question related to all this is what's the cost of this? i think a lot of universities and other schools and big companies are looking into testing saying how much is it going to cost to pull this off >> first of all, real quick, let me say when the partying happens, the partying we believe will happen -- we'll have less ability to control it if we're not face-to-face that is important to say on the partying we are looking into the use of hotel rooms, maybe in the community as quarantine spaces we're also looking at the possibility of some students being able to be transported home for their quarantine. as far as how much it will cost, the testing itself is we're estimating somewhere in the range of 3 to $5 million for the semester if you're going pool testing you're doing 4 to 500 tests a day for our students, faculty, and staff. right now we're at a cost of about $75 per test if you add the diagnostic tests

you come out to about $3 million the cost of testing is dropping every single day. >> so just to understand it, 3 to $5 million for a community of how many people all in >> about 35,000 students, faculty, and staff. >> 35,000 people for the course of about four or five months there. martha thanks so much for joining us. >> it's less than three months. >> three months, go big red. appreciate it. >> talk to you soon. >> you bet. >> wish them well. coming up, the june jobs report is due at 8:30 eastern this morning here's what economists are expecting, although the consensus has had a tough time getting anywhere near the numbers the last few months. amazing, i don't even want to say thatment .that..

it is jobs thursday. the futures are higher ahead of the june jobs report as investors bet on strong rehiring the preview straight ahead. the nation's latest outbreak of the coronavirus forcing states to roll back reopenings and some companies to hold plans

to open their doors. constellation brands is jumping into the direct to consumer wine business that story and much more is coming up as the second hour of "squawk box" begins right now. ♪ good morning, and welcome back to "squawk box," on this thursday meets friday in july here right ahead of the 4th, u.s. equity futures at this hour, markets in the u.s. are closed tomorrow, of course, in observance of independence day we have green across the board right now. we do get the jobs number in just a little bit, joe, and we'll see what happens with the markets. >> yes, and we'll know more about the state of the jobs market in about 90 minutes economists are expecting to see

2.9 billion jobs created in june and a 12.4% unemployment rate. weekly jobless claims are expected to rise by more than 1 million. i have told steve that he needs to get -- were you up at 6:00? do you know how much you factored in to our great first hour, liesman? did you hear anything about it? did any of the lies maniacs alert you. >> i didn't, joe >> you can have it on in the background, steve. you can have it on -- >> in my new location, joe, i don't have the tv set up just yet. >> you know what that's fine. stick with the new location. all we were really saying was that you may not play, you may not sing, but if the occasion arises, you don't even have to get up you could actually probably reach that thing and get it over

to where you are, right? to do the weight, which we played a little sound from. >> it could happen, and if people are really interested, there are plenty of youtube videos out there if you'd like to hear how i sing, but i would caution that i play guitar a lot better. >> all right >> than i sing. >> i guess, did you sigh michelle girard said 7 point something for jobs. >> she's part of my report here where i talk about this range and this confusing cross current right now that makes any kind of prediction really difficult with any precision, but on balance, you know, this is going to be a positive report. that's at least the consensus. so look at the numbers here, which are quite remarkable 2.9 million is the estimate, but some of the range of stuff that i've seen is 2 million to north of 7 million

the unemployment rate 12.4%, we'll talk about that more in a second, wages kind of depressed as lower paid hourly workers ostensibly come become, and there's the adp payroll number at 2.4 million we have the early stages of state reopenings we've got ppp rehiring that could cut both ways. still high jobless claims expected around 1.4 million and misclassified unemployment workers that probably should have resulted in a higher unemployment rate last month by 3 percentage points. okay, goldman writes, alternative data, which we've been bringing you a lot of suggest a stark rise in work rate staffing. barclays says in the other direction is the possibility that the burst in may employment was temporarily fueled by ppp lending requirements that simply pulled forward hiring that we previously expected to occur in june now, whatever today's number is,

it's not going to reflect the closings that are happening in the economy right now. that could show up and drag down the july report, and the early movement we're seeing here, it's really on the surface. it's only once the economy fully reopens and workers get called back that we'll know if there's been lasting damage. goldman calls it the scarring effect and that's businesses that won't reopen and jobs that won't come back. becky, it's a tough call here. nobody's ever had to forecast the movement of millions of jobs in the work force within a month. on balance, we're hoping for a positive report, give us a second good month here. >> steve, when we were talking about it and i read in the -- it was written for me that jobs created as the number, and i don't know, i see what they're saying, jobs created, but i think like the jobs were already there. they were just gone. >> re-created, right >> re-created or back.

it just wasn't the perfect word. it's factually true. these are jobs that i guess we would say are created, but i just didn't think that described exactly what we were talking about effectively, right >> you know, joe, we tend to boil this down to what the market cares about, and i don't think anybody here loses the human dimension of this. i think from a market standpoint what the markets want to see is millions of people going back to work, get us set up to deal with what's going on, and then we need to look around and see, well, which chairs have been removed here are businesses closed? are jobs not coming back some obviously have been created. the market, i think, is okay in the direction of millions of jobs being created i don't think if it's two or six or five it changes the dynamic some people came back because states reopened. >> okay. all right. thank you, steve

>> thanks, joe, for more on the markets and the economy, we are joined by lisa cook who is professor of economics and international relations at michigan state university. also mike santoli, of course our very own senior markets commentator here at cnbc lisa, let me start with you first. is there any number that you think is going to accurately reflect what's really going on in the market right now, or are we kind of just guessing and doing our best here? >> both. i reserve my right as an economist to say on the one hand and on the other, it's going to be both. we are certainly, i think, going to have some information about the direction, so i think that will be unmistakable, but the precise direction and number are going to be hard to say, and that's because of all the uncertainty that they were just talking about, and even what to call it, i thought, was an

interesting conversation because are these jobs that are reinstated are there jobs that are reinvigorated. so we will have less of a point estimate we have a wide range, but i think we have less of a point estimate >> hey, mike, on that point just the idea that maybe we'll get some directional guidance about how things were for last month, but as steve also mentioned, it's not going to tell us anything about the rollbacks on some of these reopenings that's taking place how is the market going to look at this? will it take it with a big grain of salt? >> it will, becky. we're still in the zone where the spring back effect should still prevail in terms of regaining many of the jobs that were at some point going to return the market, keep in mind, right after last month's surprise gain in nonforeign payrolls, it had this big burst higher and that was the high for this recovery

rally. it all of a sudden instilled this idea that maybe it was going to be a faster, smoother reopening process. since then, the market has completely reassessed that if you look at the parts of the market that are most exposed to consumers getting back to work, they're down 12, 25% if you want to laook at hotels, airlines, consumer type of companies the market right now is not priced for the sort of unending string of great job numbers and reopenings there still is this policy, this sense out there that even if we have to get bridged a little bit further into the future that we do potentially have the possibility of on the fiscal side adding something because right now the economy in aggregate has not paid an enormous price, because income have mostly, inaggregate they've been replaced by the fiscal health. >> that's a good point >> hey, lisa, it's got to be a

frustrating time to be an economist to know that the numbers that you're getting are just kind of ballpark nurmbers. as steve mentioned, you were talking about millions and millions of jobs changes and trying to get your arms around that shift what are the specific sort of numbers that you would dig down on and look for in this report to give you some clues about what's really happening? >> certainly i'd like to know more about the misclassification to see how many workers were actually unemployed because that's been the issue, whether they were away from work absent from work for some other reason or if they were actually unemployed so i think we'll get more information about that, but one thing we know is that the data quality is increasing. so the els is getting closer and closer to the truth. so again, i think we'll have some information about the direction, and i think that, yes, it's a difficult time to be

an economist to estimate contactually what the unemployment rate is, but just to be clear, there are times when we have trouble estimating the actual unemployment rate, let's say august, right? i mean, that's the one that is typically revised often because the surveys aren't filled out, so i think that we're accustomed to having a range rather than a particular number, but i think that we'll have some guidance there. but i think also wage growth, that's a number that i am watching as well, nominal wage, the nominal wage has not been increasing as much as it should to keep one productivity, so i think that workers are, you know, are bearing the brunt of this, and i think that there will be a flat -- i think it will probably be flat, but i think that won't be good news. >> hey, mike, your first answer

made me think that there's not necessarily a number that would disappoint the market at this point, that we wouldn't necessarily be surprised by things but am i reading too much into that? >> no, i don't think there's a particular number. but you have to keep in mind what's going to happen in an hour and 20 minutes. you're going to get the jobless claim this week and revised, this month's jobs number plus revisions to last month's, and plus you have to -- as lisa was mentioning, you have to sort out exactly whether there's misclassification errors there it's going to be this noisy, very staticky message initially. i don't think it's going to change the overall view anybody has of obviously very impaired job market coming back to some degree, and we just -- it's not going to tell us much about, you know, the next few weeks because of the fits and starts of the reopening. market is falling back on, you know, high liquidities we're probably going to get more help in one form or another

and by the way, while we wait, you might as well buy microsoft because it doesn't matter what jobs look like. >> lisa, sorry, we're almost out of time, let's say chaos theory, what's the absolute biggest upside surprise and worst downside surprise could you imagine? could it be a double-digit gain or could it be just a really disappointing number in your view, is that possible given all the static >> so that's a good question, and you know, i'm an economist i'm not a magician, so i have no idea because the range could be really large it could also be very large next month because of these uneven -- this heterogeneity in openings and closings it's really the pandemic, really the disease that is governing the market. >> right, i mean, it's 2020. we're ready for anything, aren't we >> that's right. that's right. >> i don't think anybody would cause me -- and i'm just

wondering whether we're missing that angle that it could be really high or really bad. anyway, thank you. >> absolutely. absolutely >> andrew. >> okay. when we return, a lot more on "squawk," constellation brands buying empathy we're going to hear from constellation brands president robert ranson and garrett vaynerchuk is going to be with us after the break second tip: you can put googly eyes on your stuff to keep yourself company. uh for example, that's heraldo. he's my best friend. oh, sorry nancy, i forgot you were there. get the amazing iphone 11 for half-off on at&t, america's fastest network for iphones. we'all around the world.ally tough time right now, and covid-19 is still impacting so many people.

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♪ ♪ monday you could fall apart, tuesday wednesday break my heart ♪ >> it's fine it's fine. it's great feels like a friday, i'm going to pretend it's a friday, and there's definitely some booze in my future, i can tell you that let's start with booze news to kick off the holiday weekend constellation brands announcing the acquisition of empathy wine. joining us now with more on the drinker's deal, gary vaynerchuk, cofounder of empathy wines, founder and robert hanson president of wine and spirits at constellation brands guys, it's near and dear to my heart, i tell you. beer, i don't know, it's just too hard for me at this point so i'm talking margaritas, palomas

and i drink quite a bit of chardonnay with my finger in the air with my wife, and i'm man enough to admit it so gary, you don't start companies to sell this quickly, and i don't know if people know your history, but what did i read you did diaper recycling when you were a year and a half old and made like $100,000 or something? what was your first -- >> get out of here. >> no, it was lemonade at 7, right? at 7 years old >> that's right, edison, new jersey, not far from here. >> and never stopped sips thncen you just created empathy last year, and normally you wouldn't be willing to sell now, but it was just too good to pass up the way constellation can take this to the next level, the next five levels. >> constellation is the leading wine business in the world, and the reality is that nate, john, and i, my founders wanted to produce the greatest $20 wine

direct to consumer, and the reality of the wine making, the vineyards, the infrastructure, i mean, constellation is not only years, not only decades but centuries ahead of where we are just 18 months into this process. so yeah, this is one of those one plus one equals 11 where both sides of the equation bring so much value it becomes a no-brainer you're right, not in kind of my dna to sell businesses, but here we are >> this is a time where we're all dealing with things, i guess, robert, and restaurants and bars are such a huge generator of revenue for constellation. when that's not possible, you got to go with the direct -- you've got to go with what people are doing, and this fits in perfectly with that, like a wine library type thing, which was another gary company >> yeah, exactly you know, gary and i have been talking about this opportunity for over nine months now, so it

was certainly pre the covid cris crisis you're right, the chonsumers really shifted their consumption during the covid crisis. pre, only about 30% of people knew you could buy wine online now it's 80, 90% the brand itself is fantastic, incredible quality wine at $20 a bottle, but it's also sustainably farmed, farmed to bottle sold directly from their winery to consumer. they built the brand on an incredible platform, shopify plus, which is so consumer focused. their speed and agility of innovation are super compelling. we'll be able to apply that same business model to our high end portfolio, seimi, the prisoner wine company, trader, so the opportunity to do both things and scale the business john and they created, 50,000 cases can

be scaled up dramatically but to drive significant growth, above market growth with the rest of our portfolio. >> so the revenue in this environment is not as good, but the margins are much higher for direct to consumer >> yeah, the growth is actually dramatically higher in the digital commerce channels than the regular markets. we've seen the consumer really pivot. so let's say in dtc, there's been about seven to ten years of development over the last three months if we were in a regular cycle, it would have taken much longer but given what's occurred during covid-19, the growth rates have been incredible. dtc is growing at more than two times the rate of a general market we've seen numbers from 50% increases to about 500% increases across our brand portfolio. the platforms like instacart are also growing at that rate. it's a terrific growth opportunity for us and as you say, the margins in a direct to consumer business are usually 15 to 20% higher than our wholesale business.

>> gary, the whole facebook, what's happening and i know there's going to be -- you're going to take at least the month of july off at constellation, i guess, but gary, you talk to a will the lot of cmos and ceos, they're mad but can't point a finger at what neetds to be done or what they're angry about. how do we navigate through this and effect something positive instead of, i don't know, instead of just the headlines? >> i think you're right, i think there's a lot of hypocrisy in this execution when you look at almost every other digital platform, if you look at print media, if you look at television media, the brand safety to some of the stuff that they don't want on there, it's happening in -- to stop on facebook and not to stop all your internet advertising is just hypocrisy >> if i can jump in on that just for a second because gary and i have been talking about it, and

i agree with his view that you have to look at your whole ecosystem. one thing's really clear for constellation brands and gary and john and nate and i have made this decision for empathy as well. we categorically deny anything that would incite violence, and we're doing a lot to truly try to combat social justice and inequi inequity we're investing $100 million in black and minority owned businesses, we made a million dollars donation to social justice initiative, equal justice initiative to support their mission as well as to help educate our employees. we're really uplifting our approach to how we're developing our black employees bringing them into the company training and making sure that they've got career development opportunities. but this issue on facebook and tr instagram is really importantment we want to take a step back and look at the total social and digital ecosystem and make sure we're aligning our media practices with platforms that share our values and are

doing their part to make business a source for positive social change. >> i know your boss, robert, was on with jim last night so all the metrics came out on the actual numbers from constellation, and you got a pot company, too jeez, this is just one stop shopping for me tonight. i got wine and just right down, gummies, something like that anyway, gentlemen. >> you're a great customer >> you know, robert, the small -- small businesses and whatever business you're in in black kmaucommunity, that is -- we've had more and more individuals on, that's the old john hope, hand up, not a hand out. hand up, and then we'll take it from there and run with it that's i think the only way to do this effectively. >> the access to capital is one of the most critical issues in the black community.

they represent about 13% of the population and they get about 1% of the capital we're really excited about the investment in black and minority businesses >> we've got to go, but gary, you got a good chardonnay for 20 bucks? don't laugh at me, i know if i was cool, i'd be drinking red, but i like it out on the -- you know, outside with the -- on the a cool night. >> mandabi. >> all right, i can't tell the difference anyway. >> constellation is loaded. >> keep drinking, you'll learn. >> it's never been about vintage year, it's been about alcohol content typically. that's the only number i really look at. thank you both of you gentlemen this morning thanks for playing along appreciate it. thank you. >> thanks a lot. thanks, joe, when we come back, social media platform parler seeing a steady influx of

new users as the government cracks down on facebook, twitter, and others. we'll speak to the company's ceo about regulation of the industry and its growth, especially among conservatives. and then reskilling america's work force post-covid. the ceo and founder of cloud of based learning company amasite will join us. >> time for today's aflac trivia question, according to the national retail federation, what is the total amount americans will spend on food items for independence day the answer when cnbc's "squawk box" continues aflac. these are all the cab rides to my physical therapy. and aflac paid me directly to help. aflac. what he said. and this unexpected bill is from... the two-thousand-dollar specialist. thanks. aflac. when you're sick or injured, aflac is there.

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the moment

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facebook does have a track record of folding to pressure. julia boorstin joins us with a look at what's happening now good morning, julia. >> good morning to you, joe, mark zuckerberg seemed to double down on those comments in a town hall on friday the information first reporting and facebook confirming that zuckerberg said while he takes these matters seriously and they don't benefit from hate speech, quote, we're not going to change our policies or approach on anything because of a threat to a small percent of our revenue or to any percent of our revenue. all of this week facebook's senior executives have been calling on advertisers, talking to them about the changes that the company's announced in the last week to crack down on hate speech and to prevent voter manipulation now, last night more advertisers joined in this boycott of facebook's cbs, chipotle joining starbucks, unilever as well as ford now, despite their comments, facebook does have a track record to responding to advertiser pressure to clean up the platform

facebook responded to procter & gamble's demands to improve brand safety in 2017, to target's demands to remove the sale of illegal drugs in 2018 and to the national association of advertiser's demand for independent verification of ad views in 2018. it was lawsuits and pressure from civil rights groups and lawmakers that in 2018 pushed facebook to end ad targeting based on race and to agree to an annual civil rights audit. now, as zuckerberg works to draw advertisers back, he's also going to be in the hot seat in washington again how's judiciary chairman jerry nadler confirms to nbc news that zuckerberg along with tim cook from apple and jeff bezos from amazon will appear at an antitrust hearing in late july andrew >> thanks, julia before you go, one of the questions i think we're all trying to figure out is how have the boycotts impacted the consumer so far? do they care about this issue?

i know we talk about it, but i'm curious. >> well, look, there's no indication yet that users are stopping to use facebook in fact, we probably won't know anything specific until we get facebook's earnings, their second quarter earnings, and in fact, people may be using facebook and instagram more because they're stuck at home. i think the key thing to watch with the consumer is that if consumers care about this, it's a good thing for the brands. they support the brands. brands show they're taking a stand against hate speech. it's unclear if consumers are negative on facebook in the same way they might be positive for some of these brands if consumers started to care, if consumers were urging brands to boycott facebook, that could be really problematic for facebook. we have no indication that's happening yet. >> okay. thank you, julia we're going to continue this conversation right now, our next guest built the social media platform called parler two years ago, and in the past week it's seen its user base double to 2 million users among conservatives largely. joining us right now is parler's

founder and ceo john matze it's good to see you this morning. you've seen enormous growth. ted cruz and others have come out and started to move onto the platform and promoted it on other platforms. tell us what this moment is doing and how you're thinking about that growth, and also the business model behind parler >> well, so far the growth is sustained. we are actually maintaining all of the users that are coming over, and they seem very passionate about being on a free speech oriented platform and our business model is going to be an ad revenue model, something similar than what you'd expect with other platforms. the style in which we do it, though, is going to be a little bit different because we would like to, you know, address the idea that the -- that influencers should be able to profit off the money that's coming in from ad money, and the users should benefit and that users' data should remain private.

and so we're going to do ads a little differently, but essentially very similar models. >> john, but do you see large advertisers putting their advertising next to some of the content that's on parler >> well, the idea of how we're going to do it isn't going to be a centralized model for ad s. it will be specific around influencers. the advertisers will target influencers and poeople with a large reach. you were talking previously in the segment about facebook, the idea would be you would boycott influencers whose content you don't like, not necessarily uses a zplatform. >> i know the entire premise is free speech, but you have jews bei being, you have white

supremacists calling black people thugs, you have conspiracy theories, do you think advertisers are going to want to be next to that? >> well, i don't think advertisers are going to advertise with the people who are saying those things. furthermo furthermore, that's not a very large percentage of people on our app. it's very minute and fringe case that you'll see stuff like that, and a lot of people like that don't last very long on our platform because of the extensive media tensi attention, we've had a nasty influx of haters and nasty people coming on there just to make us look bad our general premise is we believe in the good of the american people as a whole and people should be able to have these discussions and let the crazies come out and let the world see who they are and talk with them and not let them hide and fester and do some nasty things so that's why we built a decentralized ad model where people can -- where people can advertise with influencers specifically and those

influencers' brands rather than our brand as a company, as a whole. we're a town square, we are not a publication. >> let me ask you about that, though, because to the extent that the concept is completely all speech including hate speech to some degree, is there a line at which you draw where you say, you know what? we've got to take this down, we don't want this to fester. we don't want this to build. we have seen how i think social media has effectively radicalized certain individuals over time. >> so we have a lot of very strict lines when it comes to pornography, nudity, and spamment sospam a lot of the examples you mentioned, a lot of those sometimes fall under the case of spam because those people aren't being genuine. the other concept is we've got a lot of moderation for the users they can moderate stuff on their own.

with that being said, i think this is really where people want to move because we're seeing such a large influx. people don't want to be told what to think, and people want to be able to address problems in society on their own without big brother or anybody else telling them what to do. and i think that people will come around to this more and more, the concept that society can solve these problems without regulation of the social media platform >> do you think that social media, though, has created problems in our society? >> i do, but i have a different perspective than you might i think that social media has created immense partisanship and division in this country people get on there and say nasty things to each other ask then just walk away because they know it's kind of an anonymous internet activity. on parler people get verified. people have phone numbers that are related to their accounts. we know that people know that they're acting and they're behaving as they would in a town

square, at least that's what we're trying to create you know, since we've had this influx we've seen a lot of critics and haters come on here to try to make it not such a great place, and we're scaling up to handle that. that's not going to be a long-term problem, rather a short-term one, and i think it is going to work out really well i think we're going to solve a lot of these partisan issues by allowing people to speak again we've seen that this week with an influx of blm members coming in there saying hey, we don't like these conservatives and they're having a discussion in a lot of cases, and i think that's huge because you don't see that on other social platforms. >> what do you make of the pressure that's on mark zuckerberg right now, and if you were mark zuckerberg running facebook, what would you do? >> well, i don't really want to -- i don't know if i can comment directly on what thai doing. i wouldn't like to be in a position where i had a lot of people ad boycotting me.

where zuckerberg and they're at, i don't know if they're susceptible to these boycotts and if they're going to do anything we'll see. >> now, one of the other arguments that's been made about why people want to go to parler is because they think that facebook and twitter and the like are effectively regulating them you've seen the president, president trump come out quite publicly about the fact that he thinks that these companies are doing that in some cases even to him. do you believe that they're doing that >> well, it's obviously th that they're doing something. they are taking down some of his tweets, they are putting messages over some of them saying be careful. don't look at this my perspective and the perspective of a lot of users on parler, is if you don't like what he has to say, let him say it and vote him out of office. and i think to be fair, why are we censoring their reach, their message, if people don't like it, let the people decide. you know, the platform should have no business doing that, and

so that's our perspective is, you know, let the people decide, give thepower back to them and stop telling people what to think and what to do it's not just the president who's being censored there's many people, a lot of people on the left and the right, and it's wrong. >> any chance the president's going to be joining parler soon? >> i don't know, but i really hope if he does that he tells us with at least some kind of notice because that's going to be a huge influx of people, but he does have some of his children are on there and a lot of his campaign members are on there, so i think that, you know, it looks good for that, and everyone's welcome, so whether it's the president or it's any, you know, democrats in office or anybody. we want everybody on the platform it's a town square for everybody, so everyone's welcome. >> okay, john, we look forward to talking to you again and following your progress with all of it. thanks so much for joining us this morning.

>> thank you. >> you bet. >> becky thanks, andrew, still to come this morning, a look at what's been moving in the premarket. let's take a look at the futures this morning we've been higher all morning long right now the dow is up by about 234 points that's about the highest i've seen this morning. s&p futures up by about 22, the nasdaq up by 61. the jobs report is going to be up at 8:30 a.m. eastern time it's thursday but the markets are closed tomorrow so we'll be getting this today all big numbers, also the jobless claims hitting at the same time. that could have a serious impact onhe t mke wrehearts are headed today. "squawk box" will be right back.

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box," everybody, a few corporate headlines this morning mcdonald's halting further reopenings of dine-in services at its raunestaurants, postponig them by three weeks. restaurants that have already reopened will be allowed to continue to offer dine-in service if their local jurisdiction allows it. jetblue has reached a deal with its pilot's union that will avoid involuntary furloughs until may of 2021. that stock is up by 3%. watch shares of tesla today, the second quarter delivery numbers are expected to be released today ahead of those numbers, elon musk sent out a letter congratulating workers and praising them for their work during the pandemic. that stock is up another 7% this morning to over $1,200 andrew. coming up when we return, how will america's public schools reopen this fall districts are starting to unveil their plans as doctors call for prioritizing in-person learning. we're also going to be hearing

from the ceo of remote learning company amsite, don't want to miss it. at the top of the hour, senator ben cardin is going to be susidiscussing the need for e stimul stimulus, and then the jobs numbers at 8:30 a.m., "squawk" returns right after this ♪ ♪

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your wireless your rules. only with xfinity mobile. now that's simple easy awesome. switch and save up to $400 a year on your wireless bill. plus get $200 off a new samsung galaxy s20 ultra. welcome back, everybody. remote learning across education constitutions and work forces during the coronavirus pandemic has offered a bit of a glimpse into the future that is becoming

our present. the founder and ceo of amesite, that's an ai enabled remote learning software company. it's really good to see you. thanks for being with us this morning. >> thanks for having me, becky >> all right, folks for those of you who don't know ann marie, we've had her with us before she was last with us in december of 2019 about seven months ago let me give you a little bit of background she is somebody who is kind of ticking off every one of the boxes here she's an entrepreneur. she's an engineer, she's an educator, and she's bringing everything she's learned in those things, in those fields into this. and ann marie, you were an incredibly impressive professor at the yufuniversity of michiga you had a huge job there you started a battery company that you ran before this when you joined us seven months ago, you said that lots of companies were going to be competing here, that the remote learning industry was really important, but obviously the world has changed since then what's happened in the space right now, and how do you see things -- now that we fast

forward four months into a pandemic >> it's been lively, hasn't it we just pressure tested every single remote learning solution on the planet. we pressure tested every remote work system on the planet, and we found some tears and gaps and problems that's normal, but as we talked about in december, this is not a trend that's going to away covid really accelerated some things that were due to happen anyway the reality is that most workers like the flexibility of being able to work at least in part remote, and we had learning management systems before, but we didn't really use them. now as we go into the fall, we're talking about blended learning, but the reality is the pandemic makes it crucial. it's not a nice to have, it's a need to have >> yeah, we have heard a lot of concerns about the kids who are having to do remote learning at this point remote learning is not the same as in classroom, that maybe our

kids are suffering as a result of that, and it makes a lot of parents pretty nervous as we head towards this fall and there are all sorts of the questions about whether the kids should be going back to school what would you be telling educators and parents at this point. in terms of pressure testing, what problems were there and have we found fixes or solutions for those? >> yeah, let me take those in order. first, i think the concern is well-placed. we lost between 500 million and a billion school years planet wide due to stay-at-home orders during the pandemic. just that gap alone is worrying. and then the ability to engage students, the ability to engage children is crucial, and a lot of parents have seen my child is not that engaged with the learning management system i have or the online system. yet, that same child who may not want to listen to a math lecture or may not want to conduct a group project online has no problem spending hours on social

media or video games, so we have to ask ourselves as a society, why are some of these platforms so engaging and learning is left behind and the answer is pretty simple the tech for education has been behind the tech in the commercial sectors education is a $1.9 trillion industry, and yet, the tools are pretty 1994 internet so the answer is pretty obvious, the answer is pretty obvious, get better software systems, and that theme runs through all of society, not just education, but for remote work. we all have employment platforms that we use every day whether it's hr, adp or trinet or what have you or oracle, salesforce, et cetera, pushing the economy remote pressure tested those systems, and guess what, they were a lot better than the educational systems. many of them and all of social

media and most commercial platforms are driven at least to some degree by ai, and that's the difference that allows you to have that engagement. >> how quickly can these ai systems learn and kind of get up to date and make it more fun and more engaging for students are we going to be looking at new systems that are put in place in time for the fall or is this something that takes a lot longer to fix? >> we'll see new systems we'll see new systems put in place for the fall obviously we've been pretty busy, and i know that all of the companies in this space are very busy, and i still believe that there is a need for several multibillion dollars companies in this space to serve this need there's nothing more critical than education education is the foundation of the economy. now when we look at what happens when work forces have gone remote, a skills gap is now apparent, that people who formerly worked only on ground or maybe only partially online need to move more online and become more autonomous, and so

the critical thing is to have work force training and have that delivered in an engaging way so that people can be successful the four-year degree is not going to happen in time to transition people to the work in a post-covid world we need more work force training, shorter berths, six, eight, ten-week courses that help people get their skills up. >> hey, ann marie. one of the questions i was curious about, you talked about innovation or frankly the lack of innovation in this space. is there anything to be said about the marketplace for this, for these products why there hasn't been the innovation is it that there are school systems that have been effectively purchasing or licensing some of these systems for so long, and there hasn't been enough, frankly, competition or enough sophisticated buyers of this because as parent, we're all looking at these technologies now and pressure testing them

and realizing that none of them are up to snuff. but i'm actually surprised that if i was somebody who was putting out, you know, the money for this stuff over the years that i wouldn't be looking around going this is not up to snuff either. >> well, i think everything you said is true, and the key thing about the buyer is to understand what the buyer is buying pre-covid the education sector in general looked down on online, even as student debt was racing to now the current figure, which is over $1.6 trillion. so you would think that education would now look at online as a way of delivering efficiently, but the buyers in the past were really looking for storage systems, not systems to replace what is a hundred person lecture. now we're asking ourselves the question was it ever a good idea to have 200 people in a room staring at one lone figure at a

lectern at the front of a huge lecture hall, was that ever a good experience. and the answer was probably not. now as the experience moves online, to becky's point, we need technologies like streaming video, like engagement, like ai to check what people are writing and posting and understanding it better and at a high throughput with natural language processing so we can see the direction of the class. we can see how people are engaged, and we can correct, and teachers need to be armed with that kind of understanding in order to scale and keep people's attention. >> hey, ann marie, thank you for your time today. we'll have you back again soon to talk about this like to talk more about the workplace and whether businesses are going to have the money in these difficult times to be able to invest in this, but we really appreciate your perspective today. it's good to see you again. >> good to see you, too, thank you. >> take care. coming up, the june jobs

report, just over a half hour away, we're going to get predictions from our panel and bring you the numbers as soon as they hit the wires, and as we head to a break, take a look at futures. they are indicated higher isth morning, up a similar amount for most of the premarket sessions "squawk box" will be right back.

good morning, and welcome to a mega jobs thursday, we're half an hour away from june payrolls and the closely watched weekly jobless claims, predictions and analysis straight ahead as the final hour of "squawk box" begins right now ♪

>> good morning, and welcome back to "squawk box" here on cnbc, we're getting close. i'm joe kerr nan, along with becky quick and andrew russell we're getting close to the number, 8:30, u.s. equity futures are up 226 points this morning, and we're very interested in the jobs number. we have no idea, could be 2 million, could be 4 million. we've heard 7 million, if it was double-digits, it would be incredible could be zero. when know who knows. there's so much, i don't know, noise and everything else. i think you've got some breaking news now on something, andrew. >> we do, breaking news on tesla right now. want to get to our auto man and auto exert, phil lebeau, he's got some new numbers to bring us on tesla. >> q2 numbers if terms of

deliveries from tesla much better than expected total delivery is 90,650 vehicles the estimate was for 72,000 vehicles to be delivered last quarter. the model 3 and y, they don't separate them, 80,050 were delivered, most were expecting just 61,000 to be delivered. then when you have the s and the x combined, they delivered 10,600 in the second quarter, most on the street were expecting deliveries of 9,300. so overall much better than expected numbers again, 90,650, you combine this with the 88,400 from q1, they've delivered about 178,000 vehicles so far this year remember, the guidance for full-year deliveries is a half million vehicles with the increase coming in the third and the fourth quarter, certainly they're on their way there in terms of delivering better than expected numbers, and again, that 90,650 much better than the street was expecting, guys back

to you >> thank you for that. we're going to see you back here in just a couple of minutes to talk more about tesla with analyst craig irwin who will have some commentary and analysis of those numbers. in the meantime, i'm going to send it over to beck can you. we've been watching the house following the senate's lead voting to extend the deadline to apply for small business aids through the paycheck protection program for another five weeks into august for a closer look, let's welcome senator ben cardin of maryland he is the ranking member on the committee on small business and entrepreneurship senator cardin, thank you for being here today >> it's good to be with you, thanks >> let's talk about this extension at this point. why is it necessary for small businesses to continue to be able to apply over the next five weeks weeks? >> it's clear that we still have significant problems for small businesses our economy is not back up and running. the ppp program is still needed. when we passed the bill in

march, we thought that by the end of june there would be no further need for ppp that's not the case, so i made a request on tuesday to extend the program to august 8th, and the house followed suit last night so the programs with the president's signature will be still open, but that's not the end of it. the reason we extended it to august the 8th, it gives us time to negotiate what comes next we recognize that the eight-week is n help is not going to be enough. >> that was going to be my next question, why do we think five weeks is enough, particularly when we're seeing some of these states roll back the reopening plans they had set in place. what do you hear from small businesses in your state and from around the country in terms of what they're dealing with right now? >> well, small businesses are still very much hurting. there's no question about it the effort in march was to get money out quickly, and we did. we got over $500 billion out,

almost 5 million businesses benefitted from the ppp program. it was a success the next round we need to target it on those small businesses that really need the elp, the smaller the small businesses, those that had significant revenue losses, those that are in underbanked and under serve communities, that's going to be our objective as we look at the second round, but we're going to need another round, secretary mnuchin indicated that during his testimony before our committee. the business bipartisan working very closely with senator rubio. we're working together to see what we should do next leader mcconnell has indicated we should have a bill on the floor when we return after our two-woke recess for the 4th of july, and i'm hoping that we can target a bill to continue to help small businesses in america. >> what do you think about the broader prospects just for any sort of fiscal stimulus for others beyond that in terms of what happens with the unemployment, additional benefits that have been paid out

in terms of what happens to states and local municipalitiems there have been a lot of talk from the president to the house to the senate democrats, i think, to try and extend some of that -- some of that money i don't know that there's unanimity by any stretch in terms of what that should look like, what it should be or when it will get rolled out what are you hearing from your colleagues >> several weeks ago the house passed the heroes act. we thought we should have acted before this recess the good news is that leader mcconnell indicated this week we could be taking up a stimulus package when we return in two weeks. clearly, we need to deal with state and local government and their needs, there's no question about that we need to deal with the unemployment insurance issue that is scheduled to expire this month, and we need to deal with the economic consequences of covid-19, the impact it's had on particularly small businesses.

>> but what does that look like? because that's where i think there's going to be some disagreement in terms of which states should get money, what those funds should go to obviously the situation on the ground is changing pretty quickly where you see states that had not been exposed to really the beginnings of this that are getting much more pressure these days, but alsos concern about states that are starting to reopen now and whether they will follow that same path in the next four to five weeks i just feel like this is a situation where we don't know day today let alone week to week what's happening how much flexibility will be built into some of those plans, and in terms of the unemployment, what does dealing with that look like? do you extend the unemployment benefits do you try and come up with a plan like senator portman and others have supported, which would be to offer an incentive to get people back to work there's so many different questions, and again, it's changing on a daily basis. >> so what we do is sit down and

negotiate and talk and listen to each other as we did on the cares act, passed it 96-0 in the united states senate we should start that process now, immediately, listen to each other, we have to recognize that we're in this national emergency, this pandemic, we've got to put the health of the nation first you're correct, there are different problems in different parts of this country. that's not unusual, so we have to come one a proposal that's there for all. it's going to have to be bipartisan, we're going to have to work together, and we're going to have to work with our colleagues in the house and in this administration. that's what we need to do. i think there is a commitment to make sure we get to the finish line and get something done, certainly this month we need to pass the next stimulus package and have it signed by the president. >> we are all working a little differently these days, and sometimes it's going smoothly, sometimes it's not with so many of your

colleaguesworkicolleagues working from home, have you all been able to find ways to meet up with each other using technology or is this a situation where it still needs to be done face-to-face? >> well, we do see each other face to face we do most of it through technology we're in session and we do have an opportunity in our committee rooms and while we're on the floor to have some conversations. let me make this clear, the area that i have responsibility in small businesses, we've been sitting down and working by phone and by staff on a bipartisan proposal to help small businesses we're working together we recognize it's going to have to be bipartisan, we also realize we have to work with our house colleagues we're prepared, and using the technology we have to be ready for a bill to pass this month. we know small businesses need it we know state and local

government needs it. we need to have that same type of cooperation the reality is the reality the pandemic is here and we just have to deal with it and figure out a way to get our work done >> that's good to hear, senator. we have a jobs report coming out in about 20 minutes' time. how confident are you that those jobs reports will pick up the numbers of people who have been infected, particularly at small businesses it's a pretty difficult time to try and count all of this up how accurate of a reflection do you think this will be particularly in the small business arena you're so focused on >> i think we're going to see a mixed message. we certainly have seen increased jobs as a result of the tools that we made available under the cares act. the ppp program absolutely saved jobs and the job report reflects that as we get to the end of those funds, we extended that to a 24-week use period for many small businesses, they have exhausted the help that was under the cares act. we need to replenish that. we need to step forward to

continue to help the same thing would help if we were to allow the state and local governments to not get help from us, you'll see layoffs occur as a result of that. the federal government needs to step up. that's why i say this will be a critical month the jobs report, i believe, will be mixed we'll see. >> senator cardinin, thanks for your time today. we'll talk to you soon >> thanks, becky coming up, we had just mentioned tesla reporting new delivery numbers moments ago just a day after its market cap passed toyota to become the most valuable car company in the world. we'll talk to an analyst about those new numbers right after the break, and we're also counting down, of course, to 8:30 and that flurry of jobs data coming up the numbers have been very hard to forecast, so watch out for a rks. trprise that could movehe maet stay tuned, you're watching "squawk box" on cnbc

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welcome back to "squawk box," tesla out with second quarter delivery numbers moments ago delivering a greater than expected 90,650 vehicles during the quarter. joining us is craig irwin, senior research analyst at roth capital. he has a sale rating and a $350 price target on that company our own phil lebeau is back after delivering those numbers to the audience just moments ago. craig, you know, you have been skeptical, maybe even a pessimist, you look at these numbers, what do you think >> you know, i think these are great numbers. this is why people call tesla a great company. i mean, they are executing impeccably and you know, that's been my story consistently you'll remember i just see the stock as over valued

>> and so to the degree that they're hitting on all cylinders and you think the stock is over valued, what would be the change in psychology or what would be the pivot point, inflection point that you think would change the multiple rating that investors would assign to this company? >> so today we have large cap growth managers buying this, looking at it as -- for twitter and amazon and large cap tech stocks where, you know, it's kind of a winner takes all market for a number of those companies. automotive is a very different game there are more than 180 evs coming to market by 2025, which is by coincidence the year that most of these large cap managers are valuing tesla on, and it's, you know, i think a little bit optimistic to assume that there's no success from any of

those moodels it's kind of like assuming tesla operates in a vacuum i see tesla is over valued here. i think there's better opportunities in the ev space. >> hey, phil, you know, nobody's gotten rich betting against tesla thus far, maybe during particular periods if you've caught the wave one way or another, but when craig talks about the other rival car companies out there that have evs coming to market, where are they which ones do you think have the best product coming? because part of the argument is that, yes, they may get there, but the tesla's so out front already that they'll continue to be outpacing in terms of innovation and other things down the road >> they're a long ways off, andrew they talk about how they're going to be coming out with these products i feel like it's a bit of ground hog's day when it comes to the rest of the auto industry. if i could have a nickel for every press conference at every auto show where i've interviewed

an executive saying we're coming, we've got models on the way, they're going to be here, none of them have registered this is why tesla has the tets tesla trifecta they dominate the category when that changes, if that changes, there's no way of predicting that. much lower battery cost than any other automaker out there, and they've got elon musk, and it doesn't matter what you tell me about other auto executives -- and there are some great auto executives out there -- people who i really respect and analysts respect people say they really have their stuff together, they're not elon musk when it comes to electric vehicles. that trifecta is a hard combination to break right now. >> craig, what do you say to that phil has done some hard reporting on tesla before. we've asked a lot of difficult and probing questions about tesla over the years, but you do look at a situation where they're proving themselves out when it comes to the straight numbers. >> the one thing that i would

fundamental fundamentally differ on is the battery costs. you know, a lot of these consultants are just like bad analysts right, they start with a conclusion and walk backwards. materials determine your costs in the battery industry, it's much like the industry was in the '70s and '80s there's not a lot of differentiation. tesla is not the leader there. panasonic is hands down the world's best electric chemistry, but there are others with slightly better cells, slightly better gadgets they are definitely a leader, but they do not have a big wide margin so that means that a lot of these other oems have a shot at actually being pretty competitive, and then i would say, you know, i've met a lot of people i worked in the battery industry many years ago, so i have a lot of friends, hands down the smartest guy in the world runs the dresden technology center

for daimler. he is always two steps ahead of me in finding new technology and new leaders, and you know, i don't think we can count daimler out of the game, and tesla's trading basically strip off consumer financing. >> but craig, speak to what phil just said which is automobile makers including daimler over the years have come out and said we have a car coming we have a car coming and i'm still looking around >> yep >> yeah, it's disappointing and that's why this thing has a $200 billion valuation it's definitely disappointing. i don't think it's going to be disappointing forever. i think there's going to be a period of fairly rapid catchup given that tesla's taken hundreds of thousands of units out of the hides of these very sophisticated, well-established oems >> phil -- >> andrew, in terms of -- >> i'm going to slightly push back against craig me and him have gone at this and

discussed this separately. lock, they're in energy research, they believe that tesla does have an advantage in terms of battery cost. we can sit here and debate whether or not you agree with that research or not in terms of what he's saying about daimler. there's no argument there, they do have some of the smartest people in the world. if you look at what they have done when it comes to electric vehicles, and it's stop, start, stop start, stop start, they're one foot in the present, one foot in the future, all of the automakers are with the exception of tesla if you're going to say one foot in the present, you're not going to get the valuation tesla has where it's all in the future >> so if we could bring this back, actually, to what matters for valuation, if we could bring it back to what matters for valuation, tesla is valued on about 2025 earnings, what people expect those to be, and the actual size of the china market

is going to have a big impact. the 90,000 unit number is not nearly as important as where it came from. if you look at the success of the model 3 in china, the install base or the cumulative units are around 5x where they were for the same quarter, the same count in for the s and the x versus 3.5 for north america, for usa. so the relative importance of the model 3 in china looks like it could be quite a lot more significant than the model s and model x and the model 3 externally so the reality is the chinese market we could have a smashing success of the model 3, and that's really what we need to parse in this number where did this 90,000 units come from, if it is a big china number that does actually have implications on 2025 >> okay.

craig, phil, it is the most debated stock and maybe debated company at the moment and maybe for years. we appreciate you both having that debate, and i imagine we'll do it again soon thanks, guys >> thank you thanks, andrew, still to come this morning, jobs numbers just minutes away at this point. we get both the payroll report and the weekly claims, it will be a lot of numbers to dig through. we've got predictions and instant analysis straight ahead. and later wilfred frost has an exclusive interview with vice president mike pence that's coming up at 10:00 a.m. eastern time. as we head to break, take a look at winners and losers, maybe we'll check that when we come back. stick around

welcome back to "squawk box," futures up about 200

points as you can see. nasdaq's strong, solid, up another 70 to another high premarket, anyway, s&p up 21 when we come back, jobs thursday, predictions and instant analysis on the payroll and claims, both today rhtig after the break, it's jobs thursday "squawk box" will be right back. wealth management, y your dedicated adviser can give you straightforward advice and tailored recommendations. that's the clarity you get with fidelity wealth management.

. welcome back to "squawk box," let's welcome our panel, austin, chicago booth school of business professor, kate moore, head of thematic strategy at black rock, lynn hubbard, form cea chairman at columbia business school professor. treasury secretary for economic policy under bush 43 and georgetown professor and our own steve liesman and rick santelli. as you can see, i said i was going to put a little code in for like a zoom meeting. i wrote a little bit of code for our people in the control room so it looks like zoom, whenever anyone talks, the outline, the border, in case you couldn't

tellme tell we don't need it for austin, he's going to be bashing republicans. you don't even need to see the border. >> just dropping the truth just dropping the truth. >> i love you, buddy hey, look, you're on you are on my friend you are on what do you think today? we heard 7 million earlier from michelle, but i think they achlk abo average about 2.5 million. what do you think? >> look, now we've lost -- the numbers have kind of lost meaning at exactly the moment when we have no precision, and we don't know how to count it within the bls, it's exactly what everybody's paying the most attention to the jobs numbers. i kind of think it's a disturbing thing i'm going to vote for better than expected just because the virus wasn't raging at the time of the reference >> right, who knows, we're already -- it's already an old number maybe, kate, whether it shows any of the reclosings or

anything >> yeah, identify got to agree with aust a,an, we're all focus on it because we want some good news, we're at about 3.5 million for june, but i would say there's high bands of error around our estimate at this point. i think a lot more is going to be sort of told to us through the earnings calls and recording that's going to happen oaf the next few weeks >> all right, steve the. >> 4.8 million, up by 4.8 million, joe the unemployment rate declining to 11.1% that's from 12.4%, looking at the household data, the unemployment rate declined by 2.2 percentage points, number of unemployed people falling by 3.2 million to 17.8. i'm going to search the word temporary. the number of people on temporary layoff declined by 4.8 million. that is down 2, 10.6 million, so

that's a big decline from the is a million we had previously. i'm going to search what happened with that misclassification of workers and it says here, if workers who were recorded as employed but absent from work due to other reasons, it would have been just one percentage point higher. so it was five then three, and now it looks like they have a better run on that and joe, i'll look at industries while you talk to the panel, come back to me on that. >> i want to get to rick for the claims number, rick. >> yes, jobless claims did drop for the 13th we can in a row on initial, 1.427 and that follows a slightly revised 1.482 if we look at continuing claims, boy, expectations were darn close. they ended up a whisker under 20 again, 19,290,000, slight revision to last time, hardly

noticeab noticeable trade balance for the month of may, 54 billion, 54.6 to be exact, and that follows a revised 49.8, all of those with a minus sign, of course. i want to point out, we're zoom , zoom k zooming on the futures for the equity markets testing 70 basis points not that big a distance these are really solid numbers, which means most of our panel will say they're meaningless. >> i don't know if you've been with us before, and we look forward to hearing your thoughts what do you think of this today? >> no, i haven't been with you before, thank you for having me. >> on "squawk box" i said new to -- >> i have not been with you before so thank you for having me >> yes, welcome. >> so, yeah, i would say i'm in the camp of somewhat meaningless. i think we're focused a bit too much on these numbers, especially given where we are today with the resurgence of the

virus. i do have concerns about reading too much into these numbers for what we should expect over the next few months. >> rick -- or i'm sorry, glen, we haven't heard from you yet. >> well, i do think it's a good report, a little above what i would have expected as well, but it still says the economy is healing and healing at a slow rate, which means two hings. one, given the uncertainty, we need to focus on the virus, first and foremost, and second, policy needs to take into account we don't really know exactly what the path of the unemployment rate or the jobs outlook is going to be so we need policies that are flexible. >> okay. steve, do you have -- i see you're diligently -- you're certainly not playing the guitar right now. you're working on some of the minutia here what else do you see and i hope you're not going to anger rick in any way that gets anything started between you guys. >> no, i wouldn't do that. >> you're right next to each

other down there we may have to separate you two. >> i'm always playing -- i'm always playing guitar, even if i don't have the guitar in my hand i wanted to give you some of the detail, service sector up 4.2 million. leisure hospitality bringing a lot of o'folks bafolks back, 2., i wasn't able to look at the revisions to the prior month, manufacturing doing well up 356,000, construction 158, and then retail up 739,000 maybe one way to frame the debate is this we know that in the interim period we've had a rise of infections and perhaps closings. i guess -- and i'm interested in glen's thought on this -- i'd prefer to start with more people being called back than fewer people being called back obviously you do not want to have a situation of rehiring, but perhaps employers are going to be reluctant a second time to let people go. so the bigger this number -- and we did get a good and big number this time around, the better it

is perhaps to face the renewed round of infections. >> i would certainly agree with that, and i think employers are cautious in where people are going back to welcome in addition to whether they're bringing people back at all, and i expect that caution to continue especially in metro areas and large office buildings. it remains a cloud >> so andrew, you want in? >> does it feel weird that we continue -- >> i just want to ask a question about these temporary workers -- oh, go ahead, austan. >> why we continue to have these giant unemployment insurance claims is still kind of a puzzle that we could have a strong employment report even as, if you look at the weeks from that reference week, we had high unemployment claims and they're continuing is that just the backup in the

systems in these states or are we actually still having a lot of job destruction >> well, let me actually take that, austan and pull it back on steve. i think there are two questions that are related that i have one actually has to do with ppp loans and whether you think any of those jobless claims are people who brought people back on and took them off again or whether you think we're going to see that in the future and related to all of this is given how many people we now have back on the payroll, do you say to yourself that this -- that the unemployment rate in the united states is going to be a straight line in the right direction, or do you think that there's a point at which we get a group back but then we persist at some level given some of these other uncertainties in the economy and the health issues that we're seeing right now. >> i'll take the last one first, i've been looking for a word for this, and goldman came one a good one they're calling it scarring, and

that's really the biggest interest that i have, i think you're going to have -- you've a massive number of people who were laid off, a massive number of people will come back the delta here, the difference between what comes back and what left is the scarring or businesses that didn't make it through this very difficult closing. jobs that don't exist anymore because of the new adaptations we're going to make to the virus. that's the number i'm really interested in. these big flows are not surprising to me i mean, obviously you raised your eyebrows at 4 million plus jobs created, nearly 5 million that's a big deal. we need to get everybody back in place to a sort of normal level to see what the scarring is underneath the p pp will have a big effect. it seems to have brought people back from the work force that raises the next question of which this panel is em ninently qualified to address, which is the cliff we're approaching.

ppp runs out, they extended it to august 8th. the jobless claims and extra jobless benefits run out, that's another issue. additional fiscal spending will run out, and the idea that in july they're going to have to make some decisions as to whether or not they feel the economy is able to run on its own or if it needs another several shots of adrenaline to keep going here and keep these good numbers going to. >> hey, steve, just an answer on that, we just had senator ben cardin on, and he was pretty forthright in saying they are working together, not only both sides of the aisle but the house ask the senate together because they do realize that they are going to need additional information and additional stimulus being put out there it sounds like they're going to be working on those things and i would anticipate you'll see something before the end of july we were up by about 400 points a motel a moment ago we came into this with the market up pretty sharply, i think we were up about 240

points before the number now you're looking at the dow up by about 372 points, it would open higher at this point. it's worth pointing out that this is the last trading day before a long weekend. those numbers were better than a lot of people had anticipated, and it looked like it was at least showing a trend from across the board of pretty strong numbers >> i think you lost the mic again. anyway, but i think it should be -- if you see it, i don't know, maybe put that on. annet annetta and austan, do you think the market is ready grasp any news, what a big jump we got for being meaningless, the market mu moves on them. if we get three more people, it's a hollywood square thing, and we can have charlie weaver and paul lynn, i don't think they're available actually at

this point annetta, what do you think >> i don't think the numbers are meaningless, but i do think that we're not thinking about the fact that we've had this resurgence in the virus, and the resurgence has two elements. one is the unforced errors by officials who basically opened without following the guidelines and have had now to pull back, but we've also seen a resurgence in places that did the hard thing, so restaurants were set to open for diners in new york city, that's now on hold so i think that looking forward, i don't know that we're going to be able to see the same types of job growth or continued job growth i think it's going to be very jagged and put on top of that the uncertainty in the policy environment, something will pass, but i think there's uncertainty in uncertainty and we have an election coming up four month thes frs from today enormously consequential, everything from tax policy to regulation to how we deal with

the virus on the table and how employers are going to react to that is a big unknown. >> i think we should leave everybody up because i'm watching rick and i'm going to get to rick. just to add a little bit more fuel, i want to go to austan before we get to rick, just to really spring load santelli. >> just to make him mad. look, what i think is the dilemma we're going to face is that normally in the months before a presidential election, both parties are trying to create a series of show votes where they say we were for this, and the other guys are against it, and they don't really want to reach compromises, and so the philosophy of the cares act was we don't have to decide who should get relief and rescue money. everybody gets money you get a car, you get a car, and you get a car. and now we're coming to the spot where you got to choose is the money going to go to people?

is the money going to go to small business should the money go to big business, and to get a strong number like this, i think actually it's going to make the compromise decision a little harder because there are going to be some people who say, well, if the economy's going to be strong, let's just wait couple of months before we do anything. so there's the potential of a speed bump there >> all right, rick, i don't know have you written any -- you've probably got a lot of things you want to say. just what's the core of your view >> is my border lit up i want to wait and make sure my border is lit up i want a fiery border going on here i actually agree with austan, i don't care how close we are to an election, both sides will always agree on more money i think that's one thing we can be assured of. i think with this election in particular everybody is going to be voting in a thumbs up way to throw more into it the feds only used a small percentage of their fire power, and i think some of the states

that are having these aissues they're a fire -- the east coast is a lower percentage of being open, that's going to kick in. some of the states that are over performing like the midwest, wisconsin, illinois, you haven't heard them in any negative way with the resurgence of some of these spiky areas. i would also say if this number was down 4.8 million, it would certainly matter to many, many, many people, listen, the market is what the market is. we could debate the economy. we could debate jobs in general we could debate if we're going to have a resurgence, uncertainty is the word of the month. i think that we continue to improve, i think the market looks at that as a continued positive, and if you think that the market's reflecting the economy, of course they rhyme, but that's the issue i talk about markets we can talk about economies later, with this type of fire power there's a bridge between the two. >> and you said it rhymes, and you know what rhymes with fire hire, and you said fire.

anyway, kay. >> and liar. >> i always get that in. kate, we haven't heard from you. >> joe, i thought you were going to make a reference to my hair color with the fire comment, but i wanted to get back to equity markets a little bit and to focus a little bit on what equity markets and investors and analysts are really going to need to pay attention to over the next couple of months. look, the equity market has been more or less range bound for the last month i think in general the market is pricing in more of a v-shaped recovery it's certainly pricing in a v-shaped recovery in returns of earnings, consent to about 153 bucks in 2021. i think what the analysts and the investment community needs right now is confirmation from companies as they report second quarter earnings, which are going to be abysmal but confirmation that they've modified their business models and they are speaking about a kind of existing covid, not just a post-covid world

as people get confidence that companies can put up revenue numbers and sustain their operations and activity is coming back, i think we can grind a little higher, but the election risk, the u.s./china risk and the efficacy of policy are also going to be pushing against that so you know, i expect more of a range bound market throughout the course of the summer a lot of noise underneath unless we get really good news from management teams about changing to their operations. >> i see everyone at all times, steve, and i think you wanted to say something, i saw your finger go up in the air >> finger up in the air, thank you, joe. >> index finger, not, you know, you weren't saying anything to rick go ahead >> how would you know if it was that finger, it was aimed at rick, joe. >> well, if you turn the camera right, i would know that, i think, anyway, and i just assumed that >> i want to make a point and throw it out here for the

future, which is it's time that -- at 8:31 it's time to start thinking about the july report, which happens in early august by my estimate here, 60% of the job gains came from leisure hospitality at 2.1 and retail at 740, okay? that's 2.8 rk, 4.78, maybe i di the math right and got 58% i guess i have my skepticism about this, those two industries given what's happening in the country right now, the idea that places like disney land shut down ask there's a renewed round of closures here, do we expect those kinds of numbers are able to repeat next month, or are we now talking about a much lower rate of increase of jobs and is the market going to be happy about that now maybe it's already thinking about that maybe it's already factored in, and it's not new news that this number is going to have difficulty repeating if it needs

to get the strength from those two industries >> i feel like glen, have you gotten everything off your chest? >> no, i mean, i certainly agree with steve i think we will slow down in those sectors. but remember people will be finding jobs in other sectors too. that's part of the problem austin identified. with e shouldn't expect to freeze the economy in place. the policy uncertainty is huge the president hasn't shared his platform vice president biden's plan very heavy tax. >> if you think about the school situation, if they can't reopen the schools, there's going to be a myajor barrier to having lots of people come back to the work forcement i thi force. >> we will open the schools. >> what's that rick? >> schools will reopen that's will be my prediction

schools need to open we can look at all the demographics and i understand that there's issues here in every dem grac demographic group, we're doing more damage to our young people by keeping them in this current situation of limbo with regard to schools i think i agree with austan, schools are important, but i disagree in the fact they're not going to open. they will open. >> they might open but we won't know how long they'll be able to stay open. >> yeah, that's a fair point i just wanted to say we had ylan m mui, she was supposed to do a hit for us earlier and we ran out of time. one of the things she found, when they monitor voters, 32% of likely voters say it's safe fi kids to go back to school, 47% say it's not and a fifth of voters say they're unsure. i do think that the schools will be pushing to try and open, but i also agree with what nada just said, it's a question of how long they'll stay open we have not done a very good job of monitoring what would happen

in the school population because the schools were first to close. we don't have a lot of information about whether kids could be active spreaders and it's going to be something that we watch pretty closely, too >> kate, you're nodding? >> yeah, no, i think that's right. i'm agreeing with the idea that we actually need all segments of the economy to run somewhat to normal if we expect to have continued job gains, and you know, i think there's a tremendous amount of uncertainty out there. i i think we all agree on that it's like a word we used, like we all talked about not being epidemiologists for the first part of the pandemic what i will keep on going back to here is that the equity market is pricing -- is priced in for a return to normalcy. i am hopeful and optimistic and certainly not calling for a major decline, but i think another leg up in the equity market needs further confirmation that return to normalcy is actually on the foreseeable horizon. and we need a lot more data and

a lot more activity. >> kate, just to put a fine point on that in terms of what the market is thinking, you're saying a return to normalcy. is your view that that expectation of normalcy is third and fourth quarter of 2020 to get the kind of equity equity p baked in right now, or is that first/second quarter 2021 when you hear people like scott gottlieb and others say we might have a vaccine that might become available at that point? >> yeah, exactly i think it's the first and second quarter of 2021 people are writing off earnings and a lot of activity in the second half of 2020, but if we are not making continued progress you have to ask yourself like how much incremental risk do you want to take again, to be clear, i'm not calling for a massive decline in the equity market but i could see a more range bound situation for a longer period of time with the election and china, policy and virus risk, unless we're starting to get continued improvement in data and i think in the vaccine and therapeutics.

>> great i want to thank everyone, thanks to austin, kate, glen, netta, steve, rick. you could not see george, harvey and carl is down there i'm peter marshall becky, over to you >> all right joe, thank you let's recap those jobs numbers a lot of information that came at us very quickly at 8:30 june payrolls showed 4.8 million new jobs were created last month, the unemployment rate fell to 11.1%. both those numbers were better than economists had been expecting and as a result you saw futures pick up even more ground we had been higher leading into that number, maybe up to 230, or 40 points, now the dow is indicated up 381 points, the nasdaq is up by 100 and the s&p 500 up by about 36 let's get to cnbc headquarters, jim cramer is standing by. jim, one of the things that kate moore said a couple minutes ago i thought was pretty interesting, just this idea that

we will be focused on what we're hearing from companies when they start reporting the results, we know the results for the quarter will be pretty lousy, but just in terms of what they will tell us about their business model. have they adapted to this covid world if we assume that covid is going to be around for a while and still dealing with that. i think that's pretty huge just from the ingenuity of companies and what entrepreneurs are kind of been able to figure out and how to operate in an environment where we do have covid still sticking around. what do you think about that >> definitely. i mean, look, these numbers are remarkable, but, yes, if you're going to have this number, people involved in getting -- in retail and hospitality, i mean, people are figuring out another way to get the product to you. i mean, the chipotles of the world saying, listen, we have to be chipotle. this is the marriott saying, look, we are going to start having travel we better get involved a lot of these businesses don't have a lot of let's just say demand yet i think they're prepping for it.

i think they are think that the economy will reopen in texas and florida and california and they better be ready. now, obviously, there have been problems with the reopening. these numbers i think reflect the fact that the reopening is going to go smoothly it hasn't, but at the same time there's an optimism in the country that i think is often not shared with people who are on air and that's only because we don't see the hiring, but people are hiring. frankly i found it astonishing, versus what we hear. >> i think andrew has a question, too. >> hey, jim, you know, i follow you religiously on twitter and i saw you tweeting earlier that some of the airlines and maybe some of the cruise ships and others should be selling more stock into the market to raise money. and my question for you is i completely understand why the companies should do that my question is do you think that investors on the other end should be buying it right now? >> i mean, i think, look,

southwest doesn't need -- they have a good balance sheet. if you have let's say a substantial state that's owned by the government you have to get rid of that, just like you had to get rid it with the banks in 2009 and '10. as long as there are people bidding folks up furiously between 430 and 730, even though american sold 74 million, sell another 74 million the buyers aren't going anywhere the cruise lines, they are not allowed to cruise but their stocks keep going higher sell more stock. the cruise lines need the money, they have to be able to assure they can get through a flu season in the fall, all the airlines need money because they are owned by the big substantial pieces by the treasury so take advantage of the bizarre retail buying and get the bid. >> hey, jim, we are going to see you coming up in just a few

minutes, but you are ready to go >> oh, man, i am all fired up. don't forget this is the strongest day of the year seasonal >> that's right. you've been telling us that for a while. good call. thank you. >> thanks, guys. thanks, becky and jim. meantime, we will talk more about the market reaction to the jobs report this morning, joining us right now is jim paulson, chief investment strategist at the ludhold group. he has been one of the great optimists out there. let's talk about these numbers and where you think the market is headed. >> well, the numbers is good. >> is it sustainable i think is probably the biggest question. >> right well, you know, i think they are. i think if you look at the broader reports, you know, beyond today's, you know, i mean, certainly all the different job reports tell a similar story, whether you are looking at the job numbers here today or the unemployment claim numbers today or the numbers that have been in the ism job components of the ism reports or

numbers in the job components of the consumer confidence reports or the adp numbers, they are all telling a similar story. you can argue about whether it should be strong or or weaker, whether they are overstated or not, but the direction of the economy is certainly north i think that's all it has to do to continue to provide confidence, not only to investors, but also to companies and to consumers and i think it's going to -- if we can just -- it doesn't have to be a v, if it just continues to head north i think that's going to be good, andrew i think the other thing about today is we're clearly in a new economic recovery. there's no way they can call these last two months a recession any longer so we've started a new economic recovery, which means we're probably in a new bull market and if that's true we're really early in this thing. it's got a long ways to go. >> let me ask you this, jim. let me ask you this. with these positive numbers if

you are the government and when i say "the government" you can be the treasury department or congress with more loans and more money to put out into the public or you can be the fed, does this -- and part of the argument over the past couple months has been not just that the economy was going to rebound to some degree but part of it was you can't fight the government, you can't fight the fed. so how does this change that calculus or does it? >> i think one of the things that are going to happen in the second half of the year here, andrew, is one is earnings estimates on wall street are going to climb with all the better economic reports we're going to have wall street having to upwardly revise their earnings numbers secondly the fed and other policy officials are going to pull back from stimulus. which is a good thing. they're going to also recognize that things are improving and that the economy doesn't need as much help. i think that's great and the third thing that's going to happen is i think bond yields are going to increase which could lead actually to greater

confidence that the economy is doing better and we are not facing negative yields you know, i think that every past recovery we've had there was big policy response and then the policies starting to away, but that's because the economy can take care of itself. one of the things that i think is underappreciated is that policies have long lag times and so far the who will sees have been massive, but they really haven't started to help the economy a lot. they've improved liquidity, they've stopped credit spreads from blowing out, proved the operation of the financial markets, but in the second half we're going to start to see the policies introduced earlier this year actually start to help the economy in a bigger way, so even though the fed may pull back the lagged impact of these policies are going to continue to pick us up as we go through this year into next year. >> we don't have that much time. you have numbers about high unemployment and what the market does after high unemployment and i guess it makes sense because there's so much room for upside. when unemployment is high the

market went up give us those numbers quickly. >> yeah, if you go back to 1948 when they started the unemployment rate, joe, if we have had unemployment rates below 5.5% the return in the market was about 8.5% per annum during those periods if we go up from about 5.5 to 7% unemployment, it goes up to about 14% per annum. if you go above 7% the returns go something like 19% per annum and above -- above an 8% unemployment rate the returns are 25% per annum. so high unemployment for wall street at least shouldn't be something that makes you run from the stock market, it should be something that boosts your confidence in taking on more risk. >> right i agree. >> i think the reason for that, joe, is when unemployment is high it says we've got a lot of room to improve the economy and we have a lot of policy officials working to do just that. >> right just do the opposite of everything that makes sense.

that's what i finally figured out. anyway, andrew, do you want to take us out. say good-bye to jim. >> i will take you out jim, thank you joe and becky, what a week what numbers to behold >> we're up like 1,000 points. >> everybody have a fabulous july 4th tomorrow and a great three-day weekend and make sure you join us next week on monday, "squawk on the street" begins right now. ♪ good thursday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer, david faber coming to you live futures up on a second consecutive upside surprise for jobs, 4.8 million as unemployment drops to 11.1 bonds close early today, markets close tomorrow for the july 4th weekend. vice president pence will join us in the next hour. the debate will rage about how much faith we put in a