this is tuesday, july 7, "squawk box" begins right now. good morning i'm andrew ross sorkin and along with joe kernen and melissa lee is in the house virtually with us becky is off nice to see you, melissa and this is a first. this is actually a first for joe, and i and becky i think that we've been together every day through this whole cra craziness. we'll start to try to take well deserved vacation time over the summer so becky has the day off so welcome >> it's been a while, mel

anything new >> it's been at least eight months >> anything new going on with you? how is life, is it a little busier than before, any change whatsoever we need to know about? >> less sleep, but, i mean -- >> busier. not boozier busier i think all our lives have been boozier. but i'm so happy for you it must be great i told you that all along. it is the greatest thing i don't know if people know what we're talking about, but how old are the babies >> seven months old. >> that is still hard. >> a boy and girl. >> still hard. >> wow >> still tough >> and you are in it deep. all right. but we digress

>> yeah, they are upstairs crying >> you look like you're far away i am hoping that they will crawl into a shot at some point. but i've seen pictures and they are so cute. >> we could have some photo bombing going on later in the program. >> maybe later >> let's show everybody u.s. equity futures at this hour, we do have some red across the board. it looks like the dow futures would be off a little over 1% right now. similar story -- well, nasdaq off a little less and the s&p 500 off as well. let's show you treasury yields this morning before we get started, you are looking at the ten year note right now at 0.673. and we have breaking news we want to get to novavax and meg tirrell has that news. >> and the u.s. government has awarded novavax $1.6 billion to

support the scale up and manufacturing of their covid-19 vaccine. and this is the largest award that "operation warp speed" has made so far. they gave $1.2 billion for astrazeneca. and so this will take their vaccine through phase three trials which they say should include 30,000 people beginning in the fall if all goes well with earlier studies and this will help them establish large scale manufacturing and including production of 100 million doses starting in late 2020. and this company's phase one-two trials began in may in australia and they expect to have the results by thes e end of july ad they will begin phase two after that and you see the awards astrazeneca is the largest so far. and this is a huge award for

novavax which is a smaller company. so a pretty g. bbig move here f the company and we'll talk with the ceo next hour. back over to you >> what we call at scale, and we can talk but what is your sense at scale for how this would work in. >> for how much manufacturing they could do 1234. >> how much manufacturing and then the time line to get it to really at scale as they say.123 >> how much manufacturing and then the time line to get it to really at scale as they say.234. >> how much manufacturing and then the time line to get it to really at scale as they say.34. >> how much manufacturing and then the time line to get it to really at scale as they say.4. >> how much manufacturing and then the time line to get it to really at scale as they say.. >> how much manufacturing and then the time line to get it to really at scale as they say. >> what they have detailed what they aim to do is at least get 100 million doses by the end of the year beyond that, they would be increasing but we don't know exactly what they would be able to do but they are not the only ones getting this support so the u.s. government is kind of could be beling together different awards to hit the

xwolg. but it requires all of the vaccines to work and history suggests that won't be the case. >> and interesting so we'll have the ceo on today and i'm quickly looking to see what we're talking about here. and this would -- it is based on spike protein, an and a antigen what everyone is using but they use a stretch of the i guess theeucleic acids and a little different approach. and it is good that we have all these different approaches >> and it is good. and it uses a protein that delivers the spike protein which is a familiar technology in terms of vaccines. so scott gottlieb has talked about the u.s. government needing to support technologies that have been proven in addition to all of the new mrna

and dna technologies >> and it looks like it is for cell based immunity as well. so we'll talk to scott gottlieb in a second. and then i guess we can talk to their ceo. so that is going for us which is nice thank you. melissa, do you want to talk to meg or are you moving on >> you know, i was going to ask meg if navavax ever had a commercial r0 duct product to m. there is optimism about the stock and some smaller players have never had the experience of actually bringing a product to market >> yeah, novavax is unproven they have been trying for decades to bring vaccines to market and so far have not succeeded. and so this is a huge move for this company so you can see the stock is up

almost 30% on this award and this vote of confidence in their approach, they of course where not the only ones who haven't brought a vaccine to market. moderna the frontrunner also has not brought a vaccine to market. moderna is a younger company whereas novavax has been trying for a long time. and they have seen some failures >> a $4 billion market cap versus moderna $23 billion so that is interesting something they might talk about on "fast money" which is ashow at 5:00 p.m. phenomenal show on every day at 5:00 p.m >> joe, i miss you >> i'm sucking up a little bit to you i know how to work it, melissa >> i don't know what you want from me, if you want a kidney or blood or something, but okay, that is fine we'll find out thanks, meg. >> just your love.

let's move on. hong kong releasing more details about how it will enforce the new security law it says that authorities will have the power to enter and search places for evidence and can restrict people under investigation from leaving hong kong the government can confiscate any proceeds related to any offense endangering national security and tiktok says that it will exit the hong kong market within days, and this is after other if he can technologies suspended their requests the company has previously said that it does not store data in china. and tiktok news,

secretary of state mike pompeo is looking at banning tiktok in other apps and americans should only download data if you want it in the hands of the chinese and a pin stock offering for quite some time. a lot of speculation about when it might happen. and it was founded back in 2004 and been among the most highly valued startups reaching a 20 w billion valuevaluation and we spoke to the ceo in january. >> we've told the company we will ipo and we are preparing internally an ichlts pipo and i that we'll do well in that context. the way we look at it, it is a bull market for monopolistic companies. and if you look at it that way,

you don't finance growth with the sweet vapors, you focus on growth with high quality revenue. and we've told people that the ipo will happen and you will see the results. >> so with the backdrop of a pandemic, palantir which people expected to go public much earlier, a lot of focus will be on that company publicly, and of course its role supporting the u.s. governments and other governments around the world and he also has a libertarian streak and oftentimesvacative ss sxwle hasn't chan >> he hasn't changed a lot in ten years when we spoke to him back in january. heist been it's been a while, hasn't it it does seem like a while ago.

do you remember that we were actually at functions shoulder to shoulder with like hundreds of people? >> yeah. >> in the same room. i don't know what we were thinking >> and you didn't bacterialize your hands. >> yeah, there were no masks do we know about -- >> joe knows i always like the elbow bump >> yeah, you've always been that way. and what about dach or courvos ? is it like far swrarharvard? >> they will do some in person, some online. and i imagine just like harvard which we'll talk about, but i think that if they do it, there will be even testing perhaps there. >> and they will also charge

full tuition >> and davos will charge full tuition too. >> exactly >> i already had one of those big checks that i just paid. and i don't even know what will happen down there at penn and so we're good, whatever does lap, be happen we'll see if the check clears, but we have no idea what it will look like. so if it is just online, i already paid anyway, i like this story. i think this is great. patrick mahomes has reportedly agreed to a ten year contract extension worth more than $400 million. espn says there is a no trade clause and kansas city would have to guarantee his salary a year out if it picks up the garn guarantees, the value could reach half a billion making it the biggest contract in sports history. the super bowl mvp is 24 years

old and has endorsement deals with oakley, state farm, adidas and proctor and gamble and that was my last bit of glory when i had money on the chiefs on draft kings. haven't been able to bet since but i was thinking this guy is not that great until about eight minutes to go in the fourth quarter and then we kind of watched what guys like him do when they need to do it. and i ended up winning some good money. not a lot, but for me, it was like $100 or something so he is worth it i think. were you watching? you saw that last fourth quarter, right he didn't look so great in the first two or three -- the first happen didn't really look so great. and i had a lot of my friends were like laughing about my bet but as it turned out, that is why you peg a winner >> i have a completely separate question >> you have a business question. >> no, but there is a betting

line -- i don't know, maybe you can bet on the united states, you can definitely bet on the uk, if the nba season -- you know they are supposed to get gown down to florida, if they actually move forward. are you betting for or against >> i looked at this as more of -- you know, in i think investments, you invest for the long term. and this is a ten year nfl deal. and it wasn't right here is the nfl going to play in orlando, it was they are willing to pony up with the hope that ten years forward we're still going to be having professional sports we'll get through this the nba, unii don't know mlb -- >> i'm trying to make in fasome money. >> "fast money," exactly >> 5:00 p.m. >> no wonder you get inso early. it is worth it you will have a ratings spike

tonight that you won't believe all right. 6:15 already how does that happen coming up, stocks under pressure this morning indicated down 273 points we gained 460 yesterday. but that is a triple digit number that looks kind of ugly in the lower right hand screen and up next, an update from scott gottlieb on the latest covid numbers. and rollbacks in some states we'll talk maybe novavax and maybe a piece yesterday in the journal about herd immunitimmuny this selenite grey is so pretty isn't it?

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the city of melbourne and victoria will reinstate stay-at-home restrictions for six weeks. the state reported 191 new cases overnight, that is its largest spike since the pandemic began joe. and meantime miami is the latest u.s. city to reverse course following a ten folds increase in covid-19 cases miami-dade mayor jimenez signed an executive order shutting down bar, restaurants, gyms and short term rentals and joining us now, dr. scott gottlieb, he is on the boards of pfizer and novavax just got a large check from the federal government for its vaccine we tried to figure it out, this is older technology where they actually create something that looks like the spike protein and inject that and get an anti

genyk response and i guess cell based immunity too is this a possible candidate we have to do as many as we can i guess. >> naerts. and it that's right. and it is a good bets. the other bets are two protein vaccines that are furthest along are the a know if i asanofi andx and these boost the immune response there is some belief that maybe protein alone isn't potent enough so they boost it but this is a good bet on a differentiated platform. they are a little behind the other vaccines this is probably more of a 2021

event. and even this morning they said that the supply would be available by end of the year so i don't know that the novavax vaccine would be available this year but good that we're placing bets on these kind of platforms. >> and i was trying to figure out, it would be a large protein. it must be wrapped in something? they said something about nano particle technology. so it must be difficult to get it to the site of action, right? >> well, the body will have the immune response to the protein itself this is a novel technology that they are using to manufacture the protein so they can do it at scale. >> and i have to ask you this and i hope you have seen this article. but you have talked many times about the studies of how many

people actually have antibodies. and the latest thing that i've seen is that there are certain people that exhibit no symptoms that may not be -- their response to the virus may not be from the antibodies, it might be from t-cells because they have memory from previous coronaviruses that they have had that weren't covid and that is why we have no idea why some people handle this virus so well and that is something that we can't measure. and so the point of this article is in the "wall street journal" yesterday, that we may have no idea what the actual herd immunity levels are if you think of cell mediated immunity that people might have. it could be much higher than whatever you say 10, 12, 15% and it could explain certain phenomena in wuhan why it didn't spread more are rapidly because people had cell wastys based im. >> and it does seem that there

is cross immunity from other coronaviruses. but what percentage of people have that, we're not sure. but if doesn't seem to that be high when you case studies if you look at the cruise ships where a lot of people became infected, if there were people with cross immunity, you probably wouldn't have seen that rate of infection. it is possible that the people in those environments were a selected group thathasn't been exposed to the prior coronavirus. so maybe there was a coronavirus that circulated that only a serb age cohort in the population had been about opposed to. and that is what happened with h1n1 older people didn't gets a sick because they had been exposed to a prior strain years ago and they had cross immunity. it could be very young people.

some of the speculation why kids aren't getting as sick is because they were exposed to a coronavirus recently that may have are supplied cross immunity we really don't know but there does seem to be? level of cross immunity from prior exposure to certain coronaviruses that some people have >> and doctor, i wanted to pivot to schools and testing you saw the news yesterday about harvard and their plans which include testing i think every three days we talked to the president of cornell earlier this week -- or last week i should say they plan to test every seven days at a cost of somewhere between $3 million and $5 million. and when we began this conversation in march about what should than in the fall, you talked about regular testing all the time my question is, do you think that you could implement a testing regime for k through 12 especially in hard hit places where the level of the pandemic

is continuing to get people back to school? because that is such a critical issue. >> i think you could some states are talking about targeting elementary schools the universities have more resources available to them. some of the universities are using their own labs as research tools to do this kind of testing. and so we'll see some elementary schools do this, it must be wealthiier districts that have the resources, but i think that we will see some public schools deploying testing as another tool to try to keep the virus out of that setting. >> doctor, gist wa just wanted c to the race to the vaccine novavax shares are climbing higher, now up by about 38% on the optimism surrounding a vaccine and i'm wondering, we

take a look at the stock reactions all the time where are you see a huge jump in the stock. but from a science and process perspective, should investor, should the public be more september c sceptical of companies who have never brought a product to market commercially? >> i'm on the board of pfizer and that is a big company that has brought vaccines to the market before. and so my belief is there is a lot of complexity of developing a vaccine. and it is in the scale up. taking the construct and making it in a way that it could be scaled up that you can produce the hundreds of millions of doses that you need. and there is not many companies that do that and do it well. sanofi does it, pfizer, merck, j & j. and so i think that you need the big companies in the game. because so much of the complexity here is doing the large scale manufacturing.

and a lot of times the smaller companies that have very novel platforms end up partnering with big companies. that is what happened with the ebola vaccine. and they partnered it with merck. so there is a lot of complexity in the later stages. doesn't mean a small company can't do it and there is enough capital in the system to support these companies, but i think that people don't fully appreciate how much of the difficulty is in doing that large scale manufacturing. and taking something -- taking a small batch and converting is it into something that can be manufactured at huge scale and you look at a company like reagain ron that controls its process end to end, they now how to scale up manufacturing. but a lot of things can go wrong as you move the products into the large scale manufacturing. >> all right

he so we need to know your stock. i think maybe short ohmoderna, long november have november nov. >> i think that it is good that we're betting on multiple platforms. >> all right good thank you. and you are part of a healthy panel just announced by cruise lines. and before we go it break, melissa, becky and i do the jumble when you come in, guess what the third word is today in honor of you being here? here it is kaqu-a-q-u-w- k-a-q-u-w-s. >> squawk. >> squawk! >> is it really in the jumble?

>> i swear i swear. it is right here kaq -- i almost jumped when i saw it i was not doing it just then during the interview or anything but i did see that and thought that you'd be -- anyway, coming up, oh, this is you, andrew, sorry. >> all good. coming up, we have new details on the people and businesses that received aid from the government's paycheck protection program. it may raise some eyebrows we'll talk about it after the break. stock futures right now pointing to a pullback with the dow off over 1% down about 236 points. take a look at the biggest pre-market decliners in the s&p 500.

might be some eyebrows raised with this next segment. hundreds of millions paid out as part of the paycheck protection program and some companies are wealthy recipients on the list roberts frank is joining us. good to see you. tell us, who is on that list

>> we'll cover a few of them you have country clubs, private je jet companies and even kanye west and ron burkle's company received between $9 million and $23 million by applying through each location. and after receiving the money, it raised another $100 million s off 400 country scluclubs and gf resorts also received funding. and you have the greenbriar

resort in west virginia, and they got between $8 million and $10 million. private jet companies after receiving hundreds of millions from the c.a.r.e.s act also received money from the ppe. and kkp got $27 million from the c.a.r.ar.a.r.e.s act and then you have the sushi empire, they received loans totaling between $11 million and $28 million. and finally, programs the most public, yeezy llc owned by kanye west, they received between $2 million and $5 million guys >> robert, just to put a fine point on it, of those dollars, and we described them as loans at the moment, how much of them are likely to be forgiven? >> there is no indication of that

we don't know. the program extends through august 8 there is still over $100 billion left in the existing program there was $30 billion that was returned, a lot of it from publicly traded companies or billionaires that said we don't need the money, we don't want the publicity. but as for how much is truly a grant from the taxpayer and how much is paid back, we won't know that for a while >> and then real quick, there are some companies claiming that they shouldn't have been on the list i'm thinking of bird, i don't know if you saw this, this is the scooter company claiming that citigroup started their application perhaps, but citigroup says they didn't, but maybe there are companies on this list that tried to apply but never got the money. what happened here >> yeah, there are inquiries by members of congress who say we want to see why the data is flawed there is some big venture capital funds that showed up on

the list that said we never applied and never got the money. so it may have been they started the application process, got a lo loan number but never followed through. and this was only loans that were publicized of over $150,000 some saying that we should have the names of everyone who received the loans, those entire list of 4 million plus receivers. and so people wanding to know who is on the list who shouldn't be and also who is not on the list who should be >> okay. robert frank, nice to see you. thank you for the report melissa, over to you coming up, we'll talk ports follow i don't strategy with u.s. equity futures pointing to a pull back. and take a look at yesterday's s&p 500 winners and losers

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son futures, we are looking at a pull back. indicated to open lower by 23 points nasdaq by 38 and joining us now is victoria fernandez and david leibovitz.

victoria, where are we in this rally? would you recommend investor continue to ride this at this point? >> i think investors need to be cautious as you mentioned, the tech sector is riding high and it is that secular growth area that we think has the most promise going forward but we wouldn't recommend jumps into the deep end right now and putting all of your funds in with full positions. i think that you need to be opportunistic. and we do anticipate that there will be quite a bit of continued volatility for the rest of the year so use those as your opportunities to start building positions and some of the names that have really had a run higher but in the end, we think the trend for the rest of the year will be higher, just pick your opportunities to go in >> and david, where do you stand on the markets and helping fuel the rally that so many have been skeptical on all the way up is

of course federal equity. and that is a huge wave we've never seen before. >> and absolutely. and i think that we're at an important juncture where markets are on the provisionally liquidity and improvement with respect to case xwloet agrowth and i wouldn't be surprised here to see some of that. i think that it could take a bit of a pause and the question of the market digesting over the next 6 to 9 months is can businessesed a capital to this environment but more importantly, can consumers continue to adapt. because if those of those things play out, we'll see the profit recovery that markets are pricing in and so can companies come through with earnings. and it will be telling over the

coming weeks. >> and the markets seem to perceive good news as good news and bad news as not so bad even though we have reports of rising cases spikes, new hot spots in the u.s., the markets don't seem to be worried about that and voerz aloof course aloh the spikes come with the spector of reclosings. and yet the markets seem to be looking past that. are we at a point where things are hoping for the west abest e though we might think that things are overvalued? >> i think that is the key point. you know, people have been talking about this disconnect between fundamentals and the markets over the course of the past couple months markets can remain irrational for extended periods of time right no there is a focus on hospitalizations rather than

case growth sfefl. a and so what a shutdown looks like, what a lockdown looks like and i think that that is giving investors more confidence than back in march and april. so as long at the liquidity task are flowing, you don't want to fight the fed and the markets will look at the bright side and we hope that things don't take an unexpect bed turn for the worse. and obviously in the back flund you ha you have the issue of the election >> and victoria, are there other areas of the world like china and the related markets surrounding china? so many markets in asia are rallying where is the best place to put your money >> we still like the domestic mark market emerging market, there is still concern as to how they will handling the covid-19 "cacases t

come through and some of the names we bought recently, chafrt charter communications we don't like a covid-19 trade per se we like looking longer term. but something that could result degree as a rufesult of covid-1. and so it fits with our analysis of strong balance sheets and will lo debt compared to good margins. and we looked at names like s&p global not a growth name, but they have been reinvesting and using their free cash flow to invest in like businesses by themselves 50% ebitda margins and you have to look at companies that have growth going forward but also have the strong fundamentals because we know that second quarter earnings will be rough.

and probably not going to really get back on track until 2021 so you need that strong balance sheet for those companies to make it through. >> guys, great to speak where you. thank you. and coming up, tech stocks continuing their move higher yesterday with the nasdaq making its best one day gain since mid may. we'll take a closer look at the stocks leading the rally and here is a look at some of the pre-market laggards in the dow. boeing is the biggest drag right now. ♪ you should be mad they gave this guy a promotion. you should be mad at forced camaraderie. and you should be mad at tech that makes things worse. but you're not mad, because you have e*trade, who's tech makes life easier by automatically adding

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as part of your retirement plan. this can help you cover your essential monthly expenses. learn more at protectedincome.org . quell cowelcome back tesla shares are trading higher again this morning after more than 13% yesterday and morgan stanley raising its

price target to $740 while maintaining an underweight rating and price target $2070 and bark clclays saying that it overfunded but the analyst sees nothing preventing the shares moving hire in coming weeks. barclays keeping its $300 price target when we return, we'll talk more stocks we're deepening tech talk going. apple, amazon both touching record highs yesterday and we'll dig into those two stocks and if you should still be buying them at these levels

welcome back to "squawk box. tech sector has been leading the recent rally in stocks the nasdaq now closing at another record yesterday its best one-day gain since mid may driven higher by apple, amazon, microsoft, alphabet. the nasdaq 100 has gained 21% so

far this year. joining us is tom ford the question on so many people's minds is do you buy these stocks at these levels, tom >> the answer is absolutely. if you think about covid-19, we're in the early stages of a multi-year event during covid-19 it's a lot more digital and after we're going to be a lot more digital than beforehand companies are up north of 40% but i do think there's opportunity in the tech space. >> your audio is coming in and out a little bit living in this covid-19 tech virtual world that we're trying to conduct business in when you think about apple, for example, versus an amazon, if you could only buy one of these tech stocks still at these prices, where do you land? >> you have to go with amazon.

ecommerce is doing amazingly well covid-19 has injected amazon with growth hormone. i think you're seeing sustained growth in ecommerce. the rate of ecommerce spend is materially higher and the mix of spend devoted to ecommerce will be materially higher than in the past i'd vote for amazon over apple >> let's bring melissa in. i know she's got a question. >> yeah, tom i wanted to get to you on amazon amazon crossed 3,000 for the first time in yesterday's session. your price target on amazon is 2625 and yet you still say amazon is the one with more room to go. what brings it even higher why wouldn't you raise your price target >> great point and i do think i need to review my price target for that reason to the extent the shares are trading higher, but if you think of amazon, a lot of the strength in amazon is in the retail space, which is their lower margin business. so at some point cloud usage is

going to have to drive future cloud spending and that will drive margin, but i do think for amazon this has caused a lot of sales growth at the ecommerce level, which has reinvigorated the business they've shown over time that they've been able to adjust their margin structure to better leverage their sales >> so in terms of the future growth in amazon stock, tom, we need the margins from aws to kick in, but the way amazon has really benefitted during this pandemic is from the lower margin sales in ecommerce, is that correct so would you say this valley is really built on something firm >> yes it is correct that the majority of incremental growth has been in the lower margin growth for amazon, but if you look at cloud usage, i think that's a good predictor for future sales and margin opportunity for amazon. and amazon has shown an ability that when there's incremental

growth, they're able to incrementally invest in the business their advertising business, for example, is doing very well. one of the reasons it's doing well is they advertise against products on their ecommerce platform so i do think that while the growth has been in the lower margin, there's a lot of opportunity in the advertising, in the cloud near term and longer term. >> tom forte, thank you so very, very much. always good to see you we'll have you back soon >> thank you. >> nice to talk. >> melissa coming up, take a look at shares of novavax hitting warp speed. we will talk to the ceo stanley erck after the break top executives meeting with the boycotters jonathan greenblatt will join us a five-day winning streak on the

s&p and nasdaq looks to be broken today with pressure across the board here on the s&p, dow and nasdaq. you're watching "squawk box" on cnbc stay tuned

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after a start to the week, futures are looking lower. what's driving this market novavax has warp speed to speed up the covid-19 response the ceo joins us and tesla's meteoric rise. what's fueling the surge we will drill down on the stock and what's next for investors as the second hour of "squawk box" begins right now. good morning and welcome back to "squawk box" right here on cnbc. i'm andrew ross sorkin along with melissa lee who's in for becky and joe kernen nice to see everybody together

u.s. equity futures at this hour we are in the red. the dow up call it a little over a percent. off 250 points nasdaq down 40 points. joe? what do you think? >> what's that >> i was saying, what do you think? we're in the red this morning. is it going to turn around >> i think we need to drag out the market turmoil banner. i don't think it takes much for us to do hat you know what we really should do santoli always brings some perspective here and, you know, remember what he said -- i think he said 32.32 is what he said. that's how we can remember the high we department get back there yet after remember that horrific 1900 point day that we saw that sort of took us back to worrying about everything

i saw a news piece that said the second half of 2020 going to be much worse than the first half i'm like -- i don't know how that's possible but anything is these days anyway, let me read this s&p 500 posting its longest win streak of 2020 and the nasdaq is coming off a record close. we just lost following steep losses earlier this year. this type of comeback doesn't happen often mike santoli joins us now with more what 3232, that was the high >> reporter: it was. >> we went down and we held this time anyway. we department get back to 3232 before today but we got close. >> reporter: we got close. a couple percent away. not even that. the sort of rare company that this market is in based on how it has come back from those lows, we're not talking about the more recent few weeks, 45% off the lows 20% up quarter all of these things have not

happened that much in the office it nets out to what's bullish next 6 to 12 months it's all of the early bull market phases when you have had a rally of this strength, persistence and breadth. that kind of wins the market a little bit of the benefit of the doubt. you want to set against that the fact that people forget we were down on the year-to-date basis june 30th. only happens about 1/3 of all years. the rest of the year in those years is really not that great it's basically flat on an average basis for the rest of the year that does not necessarily fit with that very, very strong tendency of very strong markets to feed on themselves from that first group of studies skeptical sentiment is definitely a benefit a wild card here of course is the election personally i don't think there have been enough election outcomes of any particular sort

to create a statistically robust sample to say what happens ahead of and after certain types of elections whether it's an incumbent winning, an incumbent losing treat that however you like. i do think all of the historical studies point to saying give the market the benefit of the doubt but don't necessarily take it as a script for how things go from here, guys >> we're actually going to have a couple of politicos on in a second, mike, talking about what's likely to happen in november, and everything hinges on the economy in september and october. and it's like have we ever been -- it's always uncertainty, but have we ever been in a person with so much uncertainty? usually you know a couple of months in advance whether you're in a crappy economy. >> reporter: yes. >> or you're in a good economy it could totally change. we were in a great economy we were in a horrible economy. i don't think anyone knows based

on the virus what it's going to be like in september or october. how do you make any determination on the stock market either? >> reporter: no, there's no handy way to do that the old rule of thumb was by labor day people's attitudes about the economy and candidates has solidified i don't think that's true. people look at the markets more than they used to as some kind of indicator of the economy, economic momentum so, no, i don't think it's an easy one to handicap this time. >> nothing is easy anymore melissa? >> all right mike's going to stick around let's bring in ryan dietrich, senior market strategist at lpl financial. ryan, you heard what mike was talking about in terms of election results, maybe not enough of the dataset in order to determine a pattern how do you think the elections factor into this year, which has been so unusual already? >> well, first off good morning thanks for having me back.

like mike said, there are so many factors in there. building on what mike said, we had a 20% gain in the second quarter. only eight times since world war ii did we gain 15% think about this, the next quarter higher two quarters later every single time there is that sign, that signal that all of the strength that we've seen earlier this year, it is consistent, this sounds crazy, it's more consistent with the beginning of a new bull market, not the end of a bear market, not a bull market bounce now it's the election, right here's a wild one. we have a split congress the last ten years we had a split congress s&p finished higher every time. this could be the 11th one other factors, the stock market hasn't been down with the president up for election since 1940 you have crazy stats playing in that suggest, yes, it was so scary later this year but maybe this comeback, it's not as big of a shock when you look at the bigger picture in our view. >> are you bullish then on the

markets, ryan? that's what it sort of sounds like, based on history and how far the markets have come in the coming quarters, things are usually higher do valuations play into this we don't have earnings multiples that we can rely on. i'm not really sure how we judge where the markets are right now. >> you're right. we do remain bullish we think the second half of this year stocks will outperform bonds. talk about pe multiples. we know the p. that's the price the e part is so uncertain look what fact set said last week the largest cuts to any quarter's earnings in the second quarter, expected down 45% that's a really lobar. then you look at the manufacturing data we saw globally even brazil's manufacturing is soaring back few things are better predictor of earnings as manufacturing manufacturing is starting to improve, which it is, that suggests earnings, in our opinion, the second quarter have come in a lot better than expected and maybe justify the rally.

doesn't mean we keep soaring higher i came on three weeks ago and said expect a summer consolidation. so far that's happening. the broader markets are consolidating. we think that's the playbook maybe the typical election year surge into the end of the year after the election is over is how we see things playing out. >> mike, ryan had mentioned tech there's some real standouts. tesla which we'll talk about later on that stock is up 43% in the past five sessions. square is up 15%, more than 15% in the past week we're seeing certain pockets of tech these are sort of the -- either the pandemic winners or the ones where people think that the future is sobriety we've already looked past 2021. >> reporter: that's right. >> in the near term future, these are the companies of the future is there a problem fundamentally with seeing a pocket of the market like this that may appear to be frothy >> you would think eventually

absolutely, buy halve i don't recall -- behaviorally and the amount of money to get in. if everybody is being a moralist given a pass on 2020 earnings, real interest rates are negative right now, therefore, the valu of the distant future is higher today than it usually is and so what you want to essentially do is make all these bets on stuff that maybe is going to pay off way down the road for decades. now, again, that's the academic view of what's going on. what's going on is people chasing the kind of buzzy, sexy names. if you look at things like the speculative action in nasdaq stocks, nasdaq volume over new york stock exchange volume, it looks like it is getting overheated it has looked that way arguably before this little streak in tesla. it looked like it was a little bit stretched. >> is that a problem in your view, ryan along with the surges we've seen in the momentum stocks we've

seen a huge rise in the retail trader, in the activity among retail traders. >> yeah. it's a concern is it 1999ish? we don't think so. these companies we're talking about are having earnings. the faang stocks, there are earnings coming in it is a little bit different we don't like it when people say that it is different. the retail crowd, yes, there are pockets of excitement. markets have come back a long ways that makes sense that plays in with our overall theme that maybe there is time for summer consolidation, 2003, 2009 rally into may and summer consolidation. we think history is going to repeat itself again and maybe some of that frothiness is perfectly normal when you have a big move that's what's necessary to let the market catch its breath. we can let that surge into the end of the year. >> all right ryan detrech, thank you. and thanks to mike santoli. coming up, novavax announcing it will ramp up phase 3 trial to the covid-19 vaccine.

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covid-19 antibody drug this is from both barda through operation warp speed that project focusing on that and the department of defense. the initial doses could be ready by the end of the summer this will support the manufacturing of treatment and prevention doses between 70,000 and 300,000 for treatment or 420,000 and 1.3 million doses for prevention there's different doses for each one. regeneron says that the u.s. government is committing to making these initial lots

available for free to people if this drug is successful and gets approved at least for the initial lots this morning we got the news that operation warp speed is awarding $1.6 billion to novavax. joining us is stanley ercks. thank you for being with us. this is the largest award operation warp speed has made for a vaccine with the goal of having 100 million doses available by the end of this year how confident are you in being able to meet that goal >> well, everybody's working towards that goal. we've started in early january when the gene sequence was first identified for coronavirus and we've been using a manufacturing platform that we've used on a lot of our vaccines over the past years to scale up and we think we have the capability of doing that

what the grant does is allow us to do two things in parallel, one is to conduct phase 2 and phase 3 clinical trials which are very expensive efforts to show that the vaccine is, number one, safe, that it's effective and that the vaccine is stable and then in parallel, these things are usually done in sequence, in parallel we'll be able to manufacture large quantities at multiple locations in five or six countries >> so the goal of 100 million doses by the end of the year, is this a two dose vaccine most likely so that could cover potentially 50 million people? >> that's the purpose of clinical trials. to show whether it's one or two doses and the scaleup is starting already and we'll plan to start shipping the 100 million doses in the fourth quarter and be finished sometime during the first quarter of the

year >> and tell us anything you can about the data you've seen so far. how much confidence does it give you that you'll be successful here in getting this vaccine across the finish line >> well, the two possible answers to that. one is data that we have now with this particular coronavirus vaccine is unanimous it shows that you always start in mice and show that it's safe. it sets off a potent immune response and then you move onto the higher level animals you go into non-human primates, monkeys and baboons and show that, again, it stimulates what are called neutralizing antibodies and t cell responses. that usually translates from mice to baboons and baboons to people in the past we've done this with ebola vaccine, with pandemic influenza vaccines, with an influenza vaccine where we just

finished a phase 3 clinical trial where this sequence of events plays out repeatedly, so we're pretty confident that this will stimulate a potent neutralizing immune response in humans >> tell us a little bit about the technology behind this vaccine. it does appear similar to one from sanofi. a flu vaccine that is approved is that right? and what is the track record for this technology? you just mentioned your phase 3 flu vaccine results that were positive you did have that major setback in rsv a few years ago what's the track record? >> the track record is actually pretty good. we had a setback with rsv in that we missed a clinical trial objective, but the vaccine was very -- had very potent, protective responses with flu, as i mentioned, we actually just finished a flu -- series of flu trials, phase 1,

2, and 3 and we compared our vaccines against sanofi's technology in all three trials so we were able to show that our vaccine had an improved immune response over sanofi that's been the goal of the flu program all along but they do have a similar technology. sanofi and we are making a recombinant protein. ours forms a nanoparticle and we mix ours with an adjuvant which is a chemical that helps still mu late a more potent immune response. >> that's what i wanted to drill down on, stanley, because do we know with certainty how -- as far as this specific disease goes, covid-19, do we know how much of an implien spomune resp cells and how the t cell response would be in giving people immunity?

if it's 50-50 or very important, this adjuvant that you're adding, do you feel your approach has an advantage to the purely antibody methods that yo you're seeing from moderna they don't stimulate t cells, do they >> no, that's an important and great question the fact is, nobody knows for sure it is hypothesized in a t cell response will augment when an antibody response is we will find out in clinical trials that's why you run the clinical trials >> stanley, i wanted to ask about the stock. we've seen an absolute meteoric rise in novavax. now with the premarket gain it can be 110 at the open 40% pop right now is what we're showing. that's almost a $2 billion addition to market capitalization how should investors think about this optimism surrounding the

vaccine? we all want a vaccine to be found, to be brought to market commercially, but in terms of what this could mean for your company financially, what would that vaccine mean? because investors are putting money behind your stock thinking it's going to pay off financially in the future. >> well, i like to think that we have a platform for which we make multiple vaccines and the coronavirus -- what the coronavirus does is it moves up the timetable for us to have revenue and quite a bit, actually but i like to remind everybody that we just had a major phase 3 pivotal trial in flu and i think everybody knows that there's an established flu vaccine market but the flu vaccines don't work as well as we would like them to be our goal is to have a differentiated, better flu vaccine. we announced those data at the

beginning of april and i think that that's an indication not only that we have a -- could have a very successful flu vaccine but that same platform is used for the coronavirus vaccine. i think there's a lot of reason to be optimistic that our vaccine platforms will work. >> stanley, of course the other major question about these vaccines is their safety and, you know, folks being nervous that they are being developed so quickly what can you say about the safety of the vaccine that you've observed so far and guarantees that you can make -- that you will ensure safety before applying for approval >> as you pointed out, safety is really critical in vaccines. unlike cancer therapy where you're treating people who are really sick and you can have side effects, vaccines, you're giving vaccines to healthy people in this case maybe hundreds of millions of billions of healthy people your vaccine has to be really safe that's, again, the purpose of

clinical trials in broad populations is to measure that safety that's the number one issue. the good news is this is a platform, again, repeating that we're simply making a recombinant protein with an adjuvant that is safe in a half a dozen other vaccines that we've been developing. >> stanley erck, thank you for being with us this morning. >> sure. >> guys, back to you >> meg, thank you. thank you for bringing us that important conversation. when we return, a lot more on "squawk box." bankruptcy filings rising for the second straight quarter and the wave of companies filing could be getting worse that story straight ahead. check out the futures at this hour we are in the red this morning dow off about 230 points that's a little bit better one point still well off over a percent. "squawk box" returns right after this

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welcome back to "squawk box. bankruptcies expected to get higher in the third quarter. leslie picker joins us with more on the story leslie leslie's sound -- see, this is what happens, guys in the age of technology social distancing. we have no sound sometimes should we try it again or do we want to take a quick break and come on back okay that's what we're going to do. mel, we'll come on back right after this i'm going to send it over to

you. >> yeah. we'll try and reconnect with leslie still to come on "squawk box," your money, your vote. a look at how the presidential election could play into the markets. we'll discuss the issues that matter to your money right after this break stay tuned my name is christine payne, i'm an associate here at amazon. step onto the blue line, sir. this device is giving us an accurate temperature check. you're good to go. i have to take care of my coworkers. that's how i am. i have a son, and he said, "one day i'm gonna be like you, i'm gonna help people." you're good to go, ma'am.

i hope so. this is my passion. if i can take of everyone who is sick out there, i would do it in a heartbeat.

welcome back to "squawk box. leslie picker. she's looking at the numbers of bankruptcies in the second quarter. leslie >> thank you, andrew my audio, just one of those bankruptcies just kidding more than 3600 companies did file for bankruptcy in the first half of the year that's a 26% uptick from 2019. in june alone, chucky cheese,

chesapeake energy and 24 hour fitness a bankruptcy filing. up 44% from last year. many are attributing their plight due to the shutdown from the pandemic because much of the company is opening back up doesn't mean the filings are ending here. without ample revenue, cash awards, credit lines, government loans, but by the third quarter those will dry up says jim millsteen. >> i think you'll see, you know, a wave of bankruptcies it will make april look like a light month for bankruptcy filings. september, october could be really disastrous. to account for this, restructuring advisers have been

beefing up their teams to prepare for an onslaught according to the american bankruptcy institute guys >> before you go, leslie, what about individual consumer bankruptcies, chapter 7. that's a conversation we haven't had a lot and we haven't heard a lot about. what happened to them in the first half of the year >> so that's what's really interesting. companies saw a big uptick in bankruptcy filing but individual consumers saw a decrease year over year. 24% fewer filings were made for individuals declaring bankruptcy we talked to abi about this, the american bankruptcy institute, and they said that a large part of that has to do with some of the government assistance they've been getting, forbearance. people have been more generous the question remains what happens in the second part of the year if the programs aren't renewed, they start to go through those funds. >> okay. leslie picker, thanks. appreciate it. joe? andrew, thanks

bets being placed on the 2020 presidential election according to predict it. president trump has a 40% chance of re-election joe biden stands at 60%. the outcome of the race will have a big impact on the market and the economy. joining us now is ed mills, senior washington policy analyst at raymond james and don snider, economist on the policy research team at cornerstone macro. both of you gentlemen have all kinds of data and historical metrics on how incumbents win and it almost always has something to do with the economy prior to the election. and it's the same as this time, ed, but we have no idea what the economy is going to look like. it's only 120 days away so it's unprecedented. how do you make any determination? >> yeah, i think it's a great question, joe. what we're looking at is since

the great depression, every single time the economy has suffered in the two years running up to the election, the incumbent president has lost every single time that it's been a good economy, the incumbent president has won. so the debate that i'm having with clients is will donald trump overcome that historic hurdle or kind of what will the economy look like on election day? because every time we go and vote, it's always about a comparison if the economy is roaring back, if we do have that v-shaped recovery, is that a chance to reverse his standings in the polls? i think that is going to be really dependent depending on what else we do have the virus as well as fiscal and monetary stimulus on a vc. >> we were at 3 and change then you go up to horrific levels so is 8 good >> yeah. >> 8's horrible historically

does that become good in this -- because it's a bounce back from double digits? none of the old rules apply. i don't know how you say 8 is good or 7. i don't know what becomes good when you were at 3, 3 1/2, whatever. >> yeah, i think it's who you're going to trust on the economy. what you have seen in the data so far is that polling data still gives president trump an advantage among voters on the economy, but i think that the pushback to that, it's a good pushback, is where trump was on the economy, where he is now has been a big difference. the job of the trump campaign is trying to make this a referendum between him and joe biden and for him to, you know, kind of define joe biden differently than he is being defined right now. if this is a kind of referendum on trump, trump is in trouble at this point if it is a choice between the two candidates, that

is the opening for president trump at this point. >> so, don, normally we would say, well, you know, the executive branch, who the president is, it matters but if there's gridlock in congress, then not that much gets done maybe the tax cuts stay, corporations, you don't see biden able to do everything he wants to do. suddenly i'm seeing that if biden does win, there's a lot of pundits that are saying that he takes the senate with him into the hands of the dems. so now that might be a whole different ball game if that were to happen. >> yeah, absolutely. i think we placed around a are 45% chance that you will see that full democratic sweep and i think that is the scenario that investors do need to worry about. i think there are a few major questions to come with that.

first, if democrats do sweep are they going to make overtures as biden suggested in terms of returning to normalcy or are they going to say they have consequences, we're in the midst of a crisis and we're going to take our agenda even further in the midst of that crisis and legislate as they would? >> you're at 45% biden and senate >> sure. >> what is it for the senate, just pure senate right now that's -- i think that's flipped, too, hasn't it? 50-50? >> yeah, i think it's around 60-40 that democrats particular the take the senate. >> i'll ask you first, ed. the excitement factor. there's a couple of things, and we don't necessarily need to get too far in the weeds on this, but years ago people say that hillary just had a very high negative, hillary clinton had a

very high negative and that joe biden doesn't really strike anyone that way and that that is a positive this time around, that's how donald trump got elected. it was donald trump versus hillary. so this time around the excitement though for biden doesn't seem to be that high and people that vote for trump, whether it's 40 or 42%, whatever you think his basis, i don't know where it is now, they're going to go vote most likely does that cancel out that joe biden is not as unlikable as hillary clinton, ed? >> yeah, i think there's -- yeah, i think that's a great question, joe. i think there's two questions there. one when you look at exit poll data from 2016, trump won among voters who hated both of them because he effectively made this a choice he won by about 16, 17% of that vote right now joe biden is at an even on his favorable and

unfavorable. for individuals who dislike both candidates, according to polling data he's up by 40%. that is a huge number but, you know, you do look at the base advantage. i do think that the kind of trump base is more energized and the strategy that i see coming out of this trump campaign is not trying to convince anyone new to vote for him that didn't support him in the past, it's trying to get supporters who didn't show up in '16 to show up this year. i think that's a very difficult strategy to execute especially where we do see a lot of negative sentiment towards the president and a lot of enthusiasm, maybe not for joe biden but enthusiasm against donald trump on the left. >> so, don, in that gallup poll, trump still has 91% approval among republicans. i don't know if -- that's just a

staggering number to me when i see people on the left say republicans are going to need to explain to their grandchildren how they enabled this guy to stay in office or whatever how do republicans walk around without hiding, admitting they still support donald trump >> yeah. i think that's right his approval is low, around 38%. as you know, 91% of republicans support him. they're only 1/3 of who gallup surveys. you've seen the biggest drop off in independents. the concern for trump is not only keeping his base and republicans happy but expanding his coalition. i don't think there's good evidence in the midst of this crisis that's happening. >> there's a lot of republicans who look at the policies and are willing to accept character issues when you look at which way the country will be headed in terms of tax policy,

regulatory policy and everything else can you remember a time like this i guess every election we say that we'll know hopefully we'll know in november >> we've absolutely moved towards a more polarizing stance and i think that's part of the reason we also think if joe biden were to win the presidency, he takes the senate with him, because ticket splitting is dead. kind of hard to see someonewho comes out and votes for biden and for a republican and vice versa. >> all right, gentlemen. thanks then are people going to the polls? are we mailing in? that's a whole other issue we don't know about that and how that affects you we'll have you back, don appreciate t. thank you. >> thank you >> coming up when we return, a look at what's moving in the pre-market plus shares of tesla charging

higher for a fourth straight record close it's now up 29% over the last five sessions fueled by second quarter deliveries we're going to talk tesla and much, much more right afr iste when we started our business

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schwab stock slices: an easy way to start investing or to give the gift of stock ownership. schwab. own your tomorrow. welcome back to "squawk box. the s&p 500 looked to touch the highest level. we're looking to lose 18 dow lower by 188 and the dow lower by 29. the dow, the company that is, goldman sachs and boeing, they're all leading the dow lower this morning all down by more than 1.5% as for the s&p 500 energy

companies, they are under pressure along with alaska air and live nation which is down by more than 1.2% andrew thanks so much, melissa. tiktok will exit the hong kong market within days the announcement coming as other technology companies such as facebook, google, zoom, linked-in. tiktok is a short form video app owned by china based bytedance it doesn't store data in china and it wouldn't comply with censoring access following the new security law for hong kong, they're stopping operations of the app there. mike pompeo telling fox news yesterday the government is looking at the possibility of banning tiktok and other chinese social media apps entirely americans should only download the app if they want their personal information in the hands of the chinese communist

party. we're giving you an update from beijing in the next hour on all of this. such an interesting story given that tiktok is technically a chinese company making this decision around hong kong, meanwhile on the other side, you're seeing secretary pompeo saying don't download this app because all of the stuff is going to china anyway. >> right andrew and melissa, i was -- i looked up "godfather ii" this morning where he says, senator, we're all part of the same hypocrisy. i was thinking about grover norquist getting ppp money and media matters got ppp money. i'm thinking about nobu. it's all really -- >> or kanye. >> or kanye. but don't -- doesn't nobu have employees that we want to keep on the payroll so i'm just -- >> joe, i'm with you. >> it's ironic everywhere you

look but we're all part of the same hypocrisy, i think we know that. >> here's the question i'm of the view a job is a job is a job >> yeah. >> i think people initially wanted to treat the program that way, but then you had secretary mnuchin come out and frankly as you know, he shamed a lot of the larger companies taking that money and effectively told them to return it >> right. >> so all of a sudden there became a moral argument about who was going to take the money and who wasn't i wanted to do loans for everybody but they didn't have an application -- >> why should you do loans for everybody if certain companies can access the public markets or access capital markets in general, why should the u.s. government loan them money that's the question. i don't want to pick on kanye because i don't want to be on the wrong side of kanye. yeze, bank of america valued the sneaker portion of that business at $3 billion. last week he announced a partnership with the gap do you think that yeze couldn't access or tap capital markets in

some way >> yeah. >> sounds like they could. >> but -- >> that would be my argument. >> inran, how do you walk the walk, you know then i saw media matters, they've done nothing but excoriate the response of the trump administration to the whole covid thing. they're there, gimme, gimme, david brock. i just decided i was going to say, senator, we're all part of the same hypocrisy that was such a good line. senator pat geary was the worst human being. you have the head of the mafia there. there's a movie scenario for everything, i've decided i will bring it to you whether you want to hear it or not. coming up, tesla's meteoric rise soaring over the past few days we'll discuss what's driving the stock move after the break save hundreds on your wireless bill

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for schools, hospitals, libraries, and other public services-- and that your district is represented in congress. the census is safe and confidential, and it's critical that you participate. when you're counted, your community is accounted for. for more information, visit getcounted.com, and to participate, go to census.gov. welcome back to "squawk box. tesla shares trading higher this morning. this after gains of 13%. morgan stanley raising the price target to $730 while maintaining an underweight rating. the bull price is 2070 you have barclays saying the stock is fundamentally over valued it sees nothing, quote, preventing it from higher shares barclays keeping the $300 price target tesla shares have soared more

than 232% since the start of just this year tesla more valuable now than some megablue chips. that includes disney, boeing and goldman sachs. automakers gm and ford are a fraction of its size tesla is bigger than the market caps of all of the european automakers combined. joining us is dan ooii ives andi lebeau. >> to some extent, it all starts in china i think china is worth 3 to $400 in shares. we could see 150,000 units first year out the thing it really comes down to, this delivery number last week, 90,000 that was a jaw dropper put that all combined into

profitable tesla, right now the trajectory could be a million delivery units in the next two years. that's how it gets to $2,000 bull chips >> phil, i'm curious since you talk to so many automakers all day long and executives, what do they make -- i'm talking about the rivals now. >> reporter: sure. >> what do they make of the price move in tesla's stock? >> reporter: they think it's whacky they say there's no way you can value this company to be where it is now. adam jonas brings up a great point. i don't know if we can bring up a chart of tesla over the last week in the last week he points out that tesla's valuation has increased every single day by the entire amount of the market cap before you think about that, every single day its valuation is jumping about $25 billion in the last week. and that's why when you talk with people in the auto industry, separate from their comments about elon musk,

there's i think a combination of envy as well as frustration that they feel like here's a guy who just says stuff, it's whacky, out in left field especially about things like self-driving cars and technology that's not fully developed. on the other hand, there is an element of people within the auto industry who will admit that what tesla has done here, particularly when you look at the software management system and the battery system, they're impressed with what tesla has done while they will not say that publicly, they will admit that tesla has gone out and has essentially carved out that area of the future for the auto industry and they've become the leader >> dan, in terms of the stock move and just listening to what phil is talking about, how much of it do you think is the retail investor we talk about the retail investor pressing the stocks i have to assume this is institutional money.

>> that's how i could compare it i think six to nine months ago many institutional investors, they almost were viewing it last and the stock was moving like it was, wouldn't even touch it with a 10 foot pole now they're digging deeper into the model to understand where deliveries could be in the next two to three years what's the fundamental value if you have a million mile battery, what's it add to the stock. of course there's a huge retail component. i could tell you smart money, 180 in terms of what i'm seeing in terms of tesla, because it comes down to scarcity kind of as phil talked about, it comes down to the p word, profitability. now musk three month they're doing it in a profitable way then you have cyber truck which we believe has 700,000 pre-orders going into 2022 >> dan, i don't know, you know, if you've ever been in an environment where the disparate on the street amongst price targets, et cetera, is so wide jpmorgan raised its price target

yesterday to 295 or something like that. and then we got a street high yesterday of -- actually, you're the street high i think of 2000. when you say china, for instance, is 2 to $300 on the stock, we've seen the stock go up by that much in just the past few days at what point do you start thinking the pricing this good news in or what we can know is the good news? you mentioned the unknowable of the battery, but that's down the line and sort of in the future i don't think you would put that into your stock model at this point. there has to be a rounding in valuation, right, at this point? >> yeah. right now i don't think million mile battery is built into the stock. i sort of view it is how quickly can they get to 20, $25 earnings power? that's really the win. i think what's key now, 90,000 deliveries, you'll see profitability. then going forward you start to see europe spiking back in terms of demand. you look at china and the u.s.

you're talking about 1 million deliveries in the next two years. i don't think that that's factored in. to your point of disparate 20 years covering tech stocks, it's the most disparate i've seen this is the most emotional bull/bearish study it comes down to this, those delivery numbers will speak for themselves especially in a darko individual 19 pandemic and the soft macro that was the lynchpin to move the stock higher. >> okay. dan and phil, want to thank you so very much appreciate you being with us this morning. >> reporter: thanks. >> melissa >> all right coming up, we're going to have much more. facebook set to sit down with civil rights groups to address their complaints we have a preview of that meeting and what it means for s rahthestig aad "squawk box" will be right back. a lot goes through your mind. with fidelity wealth management, your dedicated adviser can give you straightforward advice

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markets pointing lower stocks have been red hot as late the nasdaq hitting new highs daily and the s&p 500 currently on its longest winning streak of the year plus, more fallout from china's controversial law. video app tiktok announcing it's pulling out of hong kong we have a live report and all the details and more social media tensions coming to a head today. organizers of the big facebook ad boycott set to sit down with ceo mark zuckerberg and we're going to sit down with the lead voices in the stop hate for profit campaign will be on the

call with zuck the final hour of "squawk box" will begin right now good morning and welcome to "squawk box" here on cnbc. no, it's this way. >> becky is off. melissa lee is joining us. we have not been photo bombed. have you seen your two 7-month-old rugrats this morning. >> i have not seen them. i've heard them. i hope you haven't heard them. they're awake. >> we want to. is that going to happen? have they been on "fast money" >> no, they have not made their television debut so we'll see.

>> not ready for primetime. >> they need more fanfare than a photo bomb >> i think you're right. we are open to doing it on this show i can push that through. andrew, what do you say? are you ready? >> i think this should be where the premiere happens >> why not. >> we love kids on this show. >> i'll look into it. >> we have a lot of kids who watch the show, too. >> we do we do. and animals. >> probably. >> and animals mps. >> anyway, u.s. equity futures at this hour, not down 200 anymore but pulling back big gain yesterday after last week when the averages were up 3 or 4% depending. maybe even more with the nasdaq. s&p down 17 and change

there you can see the 10-year note just down .7 of a percent andrew we've got two developments this morning just while we are in the battle of covid-19. the government awarding 1.6 -- 100 million to novavax this is to help fight the coronavirus. the goal here to potentially have 100 million doses available by the end of the year separately the government announcing $450 million contract to support the manufacture of regeneron's covid-19 antibody drug initial doses could number between 70,000, that would be on the low end, and 1.3 million on the high end depending on what they're used for they could be ready by the end of the summer. regeneron saying the government has committed to make the

initial lots of the drug available for free if it's successful in development. it gets approval good news there. melissa? the federal paycheck protection program was designed to help small business owners weather the economic fallout of the coronavirus. now we are starting to learn more about who got the money and what has been done so far. kate rogers joins us with more. >> reporter: good morning. yesterday on that massive list we saw everyone from kanye west yeze brand to the democratic national party to 650,000 national plus names of recipients of loans over $150,000 this is just about 14% of the recipients in the massive program. the average loan size here was about $107,000 so the vast majority of ppp recipients won't be released one important question remains how many jobs did this program save the administration says that 51

million jobs were supported by ppp. this is defined as the number of employees that a business had when applying for the loan, but what we do know is how many of those jobs -- what we don't know rather, excuse me, is how many jobs are intact today as the forgiveness process has just begun. you need to use 60% of the loan on payroll in order to have it forgiven what's more, 50,000 businesses listed zero jobs retained on the data released yesterday. how did businesses who canceled or make the disclosure list. they said they didn't take out loans but wound up on the list cnbc has asked the sba to explain how this is possible remember since this program was now extended through august if you're a small business owner, you can apply through august

8th. we will see another data dump. disclosing the recipients of loans more than $150,000 each, guys back over to you. >> all right kate, that's amazing joining us to talk more about the government's fiscal response to the coronavirus as well as bhat new surge in cases could mean for the u.s. economic rebound, jason furman, u.s. council of economic advisers oh, no, oh, no, oh, no i thought we moved you out of there, furman. harvard community professor. >> i'm back. >> you're back in the pod? >> i'm back. >> you rented one of those pod storage -- that's -- did your family say, get out of the house if you're going to do this i can't believe this anyway, you know what, we're allowed to listen even more closely due to your incredible nuggets and pearls of wisdom michael strain, we're totally distracted by all the stuff behind him

american enterprise institute economic policy studies director we may not even come back to you, michael we want to focus on jason. jason, what kind of more what kind of more do we need you've been saying more for a while. do you see a second derivative problem with the recovery right now, that it's waning because we have more to do and haven't done it >> wow, i'm so excited this is definitely a second derivative problem, which is the recovery is slowing. some measures are going in reverse, a first derivative problem. and regardless, any of the progress we've made has been in part due to the extraordinary amount of support the economy got in the months of may and june you take that support away even though we didn't have the rise in caseloads, the economy would faulter. what do we need to do? state and local assistance we didn't do enough of that the first time we need to do a lot more this

time unemployment insurance i think it would be fine to taper the $600 down a bit, but we definitely need something robust for the many, many tens of millions of people who are without a job through no fault of their own. >> we have you on a disagree screen but you never do. do you disagree with most of what jason is saying now >> jason said we should taper the $600 insurance benefit supplement which of course i agree with and, you know, i think you should be asking jason why he doesn't disagree with me on that. i do think we need to give some money to state and local governments. republicans are concerned about shoring up pension funds and i think that would be a very inappropriate use of taxpayer money, to take federal dollars and give those to state pension funds that have been mismanaged,

but there should be ways to give money to the states with strings attached so that it doesn't get used for pension funds but it does go to states that are dealing with significant revenu shortfalls that is shaping up to be the biggest threat to the fragile recovery in the fall, which is schools not reopening. if schools don't reopen, people aren't going back to work. you're just now starting to see some major school districts saying they're going to stick have virtual learning in the fall that's not something i expected. i expected everybody would be trying, at least trying to get back to a five-day in person school week. one thing the federal government can do is provide leadership to the school districts school districts are going to need money to pull up plastic shields, buy masks, buy the hand sanitizer, convert the gym into a bunch of smaller classrooms and do whatever.

that's an opportunity to help support the economy. >> k-12 schools, providing significant ppe. if we were to do that, it might talk a lot, but it would be worth it on the other end. you can even argue simply you could therefore hopefully bring the economy back you'd be testing communities full on all the time you'd be testing not just the kids, teachers, protect the teachers and you'd create that sense of confidence. we have not had a conversation about using government funds in that way >> yeah. i think we need to move testing out of doctor's offices and into the community. i think schools are a great place to do that kind of testing. larger workplaces, things of

this nature. you know, we have a testing problem, that's obviously no secret but if the tests are available, thoen i think getting those into the schools and testing students as often as possible, you know, every day ideally, would be an investment that would pay a huge return in terms of allowing schools to stay open which would have the downstream benefit of allowing parents to go back to work so if the testing capability is at the point where we can do that, then i think that would be a great use of money again, these state and local governments and the school districts, they're not sitting on piles of cash they can spend on this sort of thing. you've seen the federal government replace the income that households have lost. you've seen the federal government replace the income that small businesses have lost. you've seen the government help finance income loss for larger

businesses it's really, i think, appropriate for the federal government to help state and local governments with the tax revenue they've lost, you know, particularly intelligent ways like making sure kids can go back to school in the fall >> hey, jason, given what -- you were impressed with the second derivative you made some smart -- >> you're the one that brought up the derivatives >> i did acceleration, velocity change in the acceleration the second derivative. where does that put the unemployment rate as we get closer to the election does that stop going down and stay stubbornly high, which could affect, you know, how voters feel when they go in or when they mail in their ballot in november? >> yeah. i think it's very likely we're going to continue to have a very high unemployment rate on election day there's effectively two recessions there's the shutdown recession

where allegedly 18 million people were furloughed 8 million of them have gone back that's gotten better quickly but it may stop improving. then there's the sort of normal recession. the people who are fired from their jobs, the people who aren't going to be going back to their employer and that is a moderate sized recession that's been getting a little bit worse each month so the shutdown recession looks like it's going to stop improving. the normal recession underneath it looks like it's getting a little bit worse and, you know, that's certainly an ugly combination for the next several months a lot of what's going to matter will -- oh >> michael >> i was just going to say, i didn't mean to interrupt, i agree with that but an interesting question is going to be for the election, what matters more, changes in the economy or the level of the economy? the level or the first

derivative and, you know, we are going to be in very bad shape in the fall, as jason says. we're going to have a recession level unemployment rate. we're going to have an economy relative to 12 months earlier is much smaller and in very bad shape. at the same time, i think even given some of the challenges that we saw in late june and that we're seeing right now in early july, we're still going to look back at the third quarter we're still going to look back at the summer and see historic rates of economic growth, and the president is going to be able to say, you know, people said we couldn't have 3% growth. people said we couldn't have 4% growth well, we had 20% growth over the summer he's going to be right the president is going to be able to say the unemployment rate dropped 6 percentage points, 8 percentage points from its peak by election day

he's going to be right about that, too. people are going to feel that. jason's right, there are complicated dynamics happening overall people aren't going to understand the dynamics and they're going to feel the economy improving and it will be interesting to see what that does. >> thank you, michael strain and jason coming to us from the 7 1/2 floor in -- no, the shrinking room from willy wonka is what someone's writing in i'm not sure -- anyway, do you feel any anxiety where you are, furman >> i'm feeling very safe from my family but i'm going to have -- i'll be with my children in a nicer space next time, joe. >> i've got to get out of this shot i'm feeling all closed in. thank you, jason michael strain, thank you. andrew >> okay. a lot more from, i don't know, the 7th floor, willey --

wherever you want us to be with the american coronavirus cases surging, we are going to turn our attention to residents state level. is he best equipped to fight the spikes that story when we return. take a look at shares of tesla keep talking about it frankly because it's amazing saw their fourth straight record close and they're up over the past five trading sessions alone. stay tuned, you're watching "squawk" on cnbc got that. free access to every platform. mhm, yeah, that too. i don't want any trade minimums. yeah, i totally agree, they don't have any of those. i want to know what i'm paying upfront. yes, absolutely. do you just say yes to everything? hm. well i say no to kale. mm. yeah, they say if you blanch it it's better, but that seems like a lot of work. now offering zero commissions on online trades. we charge you less so you have more to invest. ♪

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box. earlier this morning the commerce department will report on the gross domestic product. not only did the economy shut down but states are having to deal with the massive costs of fighting the coronavirus over some states prospectsare bette than others. all day our scott cohn is looking at the state of the states he is our states expert. and it's good to see you, scott. what are you thinking? >> good to see you, andrew you know, if you follow the calendar, you may realize that this is normally the day when we would crown america's top state for business that's in a normal year. cnbc has decided not to do that this year because you may have noticed, it is not exactly a normal year. but we are always gathering data and what we looked at this year is health care take a look at hospital beds this is data as of yesterday hospital beds available, regular

and icu, currently per capita north dakota leads the way at 11 intensive care beds per 100,000 people and 203 beds. by contrast where cases are going down, connecticut had 1 bed for 100,000 people in the icu and 43 regular beds. now some state populations are more at risk in terms of pre-existing conditions according to a study earlier this year by the kaiser family foundation utah is least at risk for major complications from covid-19 with 30% of the population while west virginia is the most at risk at 49%. every year the united health foundation looks at overallstate health this in terms of the health of the population as well as policies at the state level like public health care spending and health insurance coverage.

this year vermont is america's healthiest state overall a courting to the united health with low rates of diabetes, clean environment and low rate of uninsured least healthy state is mississippi with the highest rates of diabetes and cardiovascular deaths. 12% of the population is uninsured. that's the sixth highest rate of uninsured. this is always part of competitiveness that we look at every year it will be even more so this year and going forward as companies still look at states, even if we're not crowning a top state for business, a lot of that activity is still going on, guys >> scott, thank you for that report always good to see you next time we'll have to guess -- we'll have to do the guessing game of where you are when we get to that. that's a different game. >> next year today i'm in california. >> next year >> i was going to guess california but, okay, fine,

you're in california. we have breaking news from united airlines. the stock by the way sinking pre-market phil lebeau joins us with all the details. phil >> reporter: melissa, as we have reported a couple of weeks and we talked about extensively yesterday in terms of bookings slowing down, united is telling tens of thousands of employees that they may receive a warn notice essentially saying that they may be laid off come october 1st. now let's put this into some context here this is not a surprise to anybody who works at united or in the airline industry. the airlines cannot fire -- not fire but layoff anybody until october 1st. that's part of the c.a.r.e.s. act, getting the payroll money from the federal government, however, they are required to give employees 60days' notice. what they are telling their employees is you may be affected by one of these warn notices you may ultimately be laid off all of this is contingent upon a number of factors, including how

many take early retirement packages do the unions restructure their contracts so there is a lower minimum workload in exchange for not laying off x number of employees. this is all part of the process figuring out where they have to go to. guys, it ties into what we reported yesterday there is a dropoff in bookings especially as you look out over the next 60 days some of this is tied into the new york, new jersey, connecticut, those states saying, hey, you've got to quarantine for 14 days if you're going down to certain states in the south and southwest. we told you then and it's coming to fruition that you are seeing fewer people booking flights and that's putting further pressure, not only on united but all of the airlines, guys that's why when you look at the chart you're likely to see the passenger levels plateau i would say over the next several weeks as opposed to go up which many people expected in july and

august >> phil, you know, in mid june when united did -- got a $5 billion loan -- >> yeah. >> -- they made a big deal of projecting cash burn to go down 30 million per day by the end of the third quarter. i would assume this hiccup throws a wrench into that projection and cash burn may remain more elevated than they predicted? >> a lot of that is on the cost side they were factoring in some improvement in terms of passenger levels, but most of the cash burn is reflected in what can we do to bring down our costs and limit number of flights, crews, et cetera. and so the cash burn equation, while it may be impacted at united and some of the other airlines in terms of bookings slowing down over the next 30 or 60 days, most of that that the airlines are building in, that's them saying what do we need to bring down our costs i'm not sure how much it will be impacted, but really they are concerned about the fact that

there is a noticeable slowdown in bookings and cancellations are not there. people will say why do i take a trip to houston or miami i'll just hang on to t. i can use it until next year. >> shares of american airlines are down 2.6%. delta is under pressure on the heels of this united news. phil, thank you. >> reporter: you bet. coming up, a fork in the road for facebook. should take it ceo mark zuckerberg set to meet with civil rights groups today on how to deal with a worsening flood of online hate in a few minutes we're going to speak to someone who is going to be on that call. next, details on tiktok's decision to pull out of hong kong ayve updates in the s&p 500. st tuned, you are watching "squawk box" on cnbc

welcome back to "squawk box" this morning want to take a look at the futures. right now we are down 212 points on the dow little over 1% s&p 500 down 20 points nasdaq looking to open down 30 points right about now joe? >> thanks, andrew. more fallout from china's new national security law. tiktok saying it plans to do this >> reporter: in light of the recent events, the company has a little bit of the app. decisions by other companies such as facebook, twitter, zoom to pause cooperating with law enforcement authorities in hong kong on data requests, but this situation is quite different because tiktok, unlike the other companies, has a parent in

china. the beijing based company called bytedance. tiktok has been under pressure from congress and secretary of state mike pompeo to try to prove that it wouldn't serve and does not serve the interests of beijing. in fact, overnight secretary of state mike pompeo had said that the u.s. is, in fact, looking at a possible ban for chinese apps such as tiktok this move for tiktok to ditch its business in hong kong, which is relatively small, could be seen as a way for the company to try to safeguard itself and get rid of this vulnerability from all of this u.s. pressure. in fact, the pressure in hong kong has been great and looks as though it's going to get even bigger for internet companies as well as all companies because if you do not give up your data,

now those companies face a $13,000 fine and potentially employees being thrown into prison for six months. guys >> we're going to have a big segment on that coming up, eunice not on tiktok so much but facebook, et cetera. thank you. nice shot that you have. we haven't seen you in a while see you again soon every day stuff -- that's all we need is another crisis to worry about, but hong kong, i don't see how that works itself out in any way where we're not reporting on it, where it's not a real positive story at this point. what's the latest overall, do you think, eunice? >> reporter: oh, i don't think that it's going very well at all. in fact, i was talking to one business person who said it's a death spiral between the u.s. and china. everyone i am talking about is thinking about hong kong, how

does that calculate into their business not only people in thefinancia industry, who are wondering, you know, should i list on the nasdaq should i list in hong kong what should i do from a chinese business perspective. but also u.s. business people who are, you know, thinking about the impact that hong kong could have on the relationship between the u.s. and china in fact, overnight a large group of business associations had penned a letter and sent it to the trump administration hoping that the u.s. and china negotiators would press ahead with a phase one deal because there are a lot of people that are worried that a phase one deal might end >> melissa i thought you had -- thought you had something for eunice you're going to take it. thank you. we appreciate it i think melissa is going to take us out of here melissa.

coming up, civil rights groups responsible for this month's facebook ad boycott getting ready to meet with mark zuckerberg just ahead, a live report on what is up for today we'll speak with jonathan greenblatt who will be on the ayll with zuckerberg st tuned, you're watching "squawk box" on cnbc no matter what challenges life throws at you, we're always here to help with fast response and great service and it doesn't stop there we're also here to help look ahead that's why we're helping members catch up by spreading any missed usaa insurance payments over the next twelve months so you can keep more cash in your pockets for when it matters most and that's just one of the many ways we're here to help the military community find out more at usaa.com

facebook's tomorrow executives set to hold a meeting with organizers of the stop hate for profit advertising boycott a list of companies pausing social media ad spending and calling for a more effective response to online hate now stretched into the hundreds. julia boorstin joins us now with what we can expect from today's meeting. hi, julia. >> reporter: good morning to you, joe facebook ceo mark zuckerberg and coo sharyl sandberg will be holding a joint call with the antidefamation league, naacp and color of change. this call is scheduled to begin at 2 p.m. eastern. the nonprofits that advocated for an advertising boycott of facebook will be discussing the ten steps they recommend facebook to take in order to crack down on racism and hate on

the platform, dlaug facebook put a civil rights expert inside the c suite to make sure the designs consider the impact on all communities and the potential for radicalization and hate. the group is demanding third party audits and refunds to brands whose ads were shown next to content found to be in violation of policies. facebook responding, quote, we share the goal of these organizations. we don't benefit from hate we don't want it on our platform we look forward to hearing directly from these organizations. now nearly 1,000 brands including starbucks and cvs have joined the boycott suspending advertising on facebook and other social media platforms sharyl sandberg just posted this morning that the company plans to release its civil rights audit tomorrow along with the dye strirs and inclusion report. sandberg saying of the meeting, they know how big a moment it is for the company.

back over to you. >> i know that she posted something else, too. what social media website -- oh, she did. she used facebook. there you go she says -- i love this, we are making changes not for financial reasons or advertiser pressure but because it's the right thing to do. so i guess that's included in there somewhere. okay >> reporter: so, joe, that has sort of been the tone she and zuckerberg had taken as we saw first dozens, then hundreds, now nearly 1,000 advertisers boycott. both she and zuckerberg have been trying to say, look, we have been working on these civil rights issues for years. instead of saying we are going to fold to this pressure, they wanted to make the point they weren't responding to the pressure, they wanted to get credit for the work they've been doing all along. it seems like they need to take further steps to make sure their posts aren't next to hate speech that's where they are. we are not making changes for

financial reasons or advertising pressure is the one that really sort of speaks to the tone they're taking right now >> okay. julia, thank you we're going to continue this conversation now our next guest leads one of the civil rights groups scheduled to meet with mark zuckerberg today virtually. joining us is jonathan greenblatt he's the director of the national antidefamation league which began this campaign. you saw sharyl sandberg's statement she says facebook stands firmly against hate and even though they are a platform, we want to give people a voice, she says it doesn't mean it's acceptable for people to spread hate it is not and we have clear policies against hate. they're coming out, you just heard from julia, with this civil rights audit is that enough for you >> good morning, andrew. it is absolutely not enough for me it is not enough for the naacp,

color of change, free press or any of these organizations, and it's not enough for their advertisers. can you imagine the ceo of starbucks said, well, we're making sure that our coffee doesn't poison people because it's the right thing or the ceo of, say, comcast saying we're not showing white supremacist content because we think it's the right thing when they say they're not doing it because of advertising pressure, that's exactly why they're doing it almost 1,000 companies and growing every day. years and years have gone by and facebook has given apologies but has failed to give the kind of action you would expect from any public company on the market today. and let's be clear, hundreds of millions of dollars in lost advertising revenue are why they're doing this when their stock price plummeted 8 1/4 perfecticent and they shad $56 billion of value off of the stock, that's why they're doing

this the time for, well, it's the right thing to do is over. now it's the thing that they must do. why should mom and pops subsidize hate it doesn't make sense. >> jonathan though, explain -- i mean, there's two pieces to this they're saying the civil rights audit was going to come out irrespective of this campaign. explain what it is that you think they need to do relative to the work they, i imagine, are going to tell you on the phone call today that they have been doing? >> well, it's interesting. i mean, if this werea good-faith effort to release the audit, they wouldn't be shoehorning it in timed with our meeting today. if this were a good-faith effort, they would have given us a set of recommendations -- about how they're responding to our recommendations rather than spinning with a facebook post hours before the meeting what do we want them to do it's pretty simple number one, put civil rights leadership at the top in the c

suite that's going to look at this in a strategic and holistic way like they would any other business priority. regular, independent audits that are published about how they're dealing with hate content. and why should any advertiser have their ads subsidize white supremacy, anti-semitism, racism they should be removed immediately, all of them the advertisers should be refunded for that. and, finally, why in the world would any business host groups of hundreds of thousands of people who espouse racism, holocaust denialism, islamophobia it just doesn't make sense that this issue persists. the only reason they're acting now, andrew, is because of stop hate for profit. >> let me ask you a separate question a lot of this requires ai. there's a fiphilosophical issue

and we can have that debate. then there is the technological issue and identifying hate speech and take it down effectively before it goes up. the question i would ask you, i think they're going to tell you today that there's work that they've done on that score i think we may have just lost jonathan for a brief moment. we've had a couple of technical issues this morning. we might be getting him back jonathan, are you back with us >> so, andrew, can you hear me >> here he is. yes, i can we were just talking about the technological and philosophical issues at play here. whether the tech is there and what other steps they need to take to get the tech right to make this work >> facebook has built the most sophisticated advertising platform in the history of capitalism they can micro target their users by location, by age, by

industry, by gender. are they really saying that they can't target neonazis? are they really trying to make us believe that they can't remove white supremacists? there's a reason why they have 8 million customers today. because their tech is so good. what they need to realize is we're not talking about a technology problem, we're talking about a values problem does mark zuckerberg believe this is an annoyance or business imperative does mark zuckerberg believe this is a neutral platform and there are good people or does he take a stand and say i won't tolerate racism, anti-semitism on my platform look, andrew, it's hard to build an $80 billion advertising bohemoth it's not hard to remove the kkk from your service, and we just need mark, we need facebook's leadership to apply the pressure to get this done and if they don't see the

urgency, maybe now that 1,000 advertisers have stepped up, maybe now they finally will. >> jonathan, i'm wondering what you'll tell mark zuckerberg and sharyl sandberg about the boycott and whether you think the boycott will get worse i'm wondering because there have been a flood of corporate donations in the past few weeks or so like yours horsebacking this boycott have you gone down that list and cross checked it to see if those same companies that have donated to your organization are also in the boycott? because that could put a lot of pressure if you went down that list and called them up and said, hey, you donated a lot of money, you got a good press release, join this boycott >> we haven't done that yet. this isn't about raising money we get donations from facebook employees. i know at adl we're putting ourselves at risk by doing this in some ways we're just a -- look, we've been

around this a long time. we realize that there's risk here for us but this is just the right thing to do. i think what you're pointing out is important and worth focusing on yes, we have almost 1,000 companies today but i've got to tell you our phone has rung off the hook in the last week and a half, not just from companies but from different kinds of organizations that want to get involved in this from different influencers who want to support this this will grow, it will expand and it will move from being an annoyance to an imperative for facebook if they don't definitively act what do we want? a public commitment and time line to implement the pretty, simple, straightforward requests it's just not that hard. >> i thought, jonathan, perhaps the temperature may grow hotter if you call these companies up who donated to the adl recently and you said, you know what, you don't want to look like you're a

hypocrite by donating to us and saying you stand with us but in the same breath you continue to advertise on facebook? >> you know, melissa it's a great point maybe it's something we do we haven't gotten a lot of donations from any of these companies but it is something worth exploring. whether you're a corporation for a small business, a nonprofit, an advocacy group, all of us should be asking questions do we want to patronize and spend our money on a company that doesn't support our values? i'm talking about values like decency, pluralism, and respect. you can't say you believe that black lives matter and then walk all over these issues by allowing white supremacists and hateful people to spread their poison on your platform. it's totally incongruous companies want to be on the right side of history. more will come if facebook doesn't once and for all act. >> jonathan, i'll tell you

what -- and you're very effective, and i find myself nodding with everything. you always use the right exampl examples you can almost objectively name certain things we all agree with, kkk, white supremacists, but then i start worrying where this, for lack of a better word, where the cancel culture is taking us in other areas that aren't quite so clear-cut. that's where i worry that one person's hate is another person's out of "vogue" notion where it's not as clear and you get on the slippery slope and it's something that an entire group feels so fervently about i feel like we're headed to "fahrenheit 451" and book burning and thought police and everything else. don't you worry about the slippery slope >> look, joe, the adl is a civil rights organization. we've been fighting for the first amendment for over 100 years but don't let facebook and

their surrogates blow smoke and create a fog around this there's nothing political about pushing back on prejudice. there's nothing wrong with hard conversations, but we have a problem with hateful actors on the site like the bugalu boys who promote civil war and who advocate violence against minorities, jews, blacks, others when they can publicly organize using facebook groups, that's a problem. so i agree with you. we've got to be careful about the slippery slope, but what we're talking about here is the abyss that's on us right now facebook can and should do better joe, look, if they had audits about how they're dealing with hateful content, if they had real civil rights leadership in the organization we could make sure that it wasn't, again, falling prey to the thought police but when one person, when one person is the chairman and the ceo, when one person controls 64% of the ownership, when one

person makes decisions for you and me and 2.6 billion other people, i would submit to you that's a much bigger problem >> jonathan, i know we have to go, but the question is how do you do that? because ultimately you are asking one person to make that decision for us. is there a different approach? >> well, what we've done here i think is different, andrew facebook is 15 years ld. they've never had a mass walkout like this before they've earned the accolades of analysts, investors, shareholders the biggest brains in the world are saying we can use our known show our values and we can put it elsewhere i've talked to many cmos who have told me they're not holding back the money for facebook. they're looking at other social media services i believe the campaign will grow and expand beyond the u.s. and

other companies. all of a sudden mark zuckerberg is going to have to say which side am i on do i believe the white supremacist values or the values that almost all other american who deal in decency? the naacp, adl or white prem cy supremacists, he had as to choose. >> we want you to come back. maybe you'll give us a readout >> i will do that. >> we'd love to hear about it. we appreciate you joining us. >> thank you. >> thanks. you bet. melissa. coming up, we have much more on the markets we are taking a look at the futures and we are looking to break our five-day winning streak on the s&p 500 and nasdaq which are both indicated to open lower. looks like the dow will open lower by 211 points. stay tuned to much more "squawk box" right after this break.

to recruit minority candidates because i focus on talent and the talent really comes through. coming up, bank of america's chris hiezy and the signs that are telling him we are already in the early innings of the next

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welcome back to "squawk box. a little more than half an hour until the opening bell on wall street dom chu has been taking a look at charts that may help explain the recent market action. >> it's all about momentum and all about where people are putting their money especially since the lows back in march so the momentum, the force has been really strong with certain parts of the market, namely what's happening in technology one etf that tracks the software

industry igb is the ticker and fdn is a ticker that tracks the internet-related stocks. look at these because during the previous highs we are now well above that for this particular etf. the same thing here when it comes to software and technology as well. so new highs there that's where the momentum is take a look at growth versus value. growth stocks have been in vogue, each more since the covid-19 lows. this white line shows the trajectory of growth stocks versus an etf that tracks them this one is the orange line tracking value stocks. look at that gap in performance, growth over value another big trend to watch one last one here. as of late, joe, emerging markets, melissa, have been outperforming very recently. you can see the slight uptick over here, meanwhile, during the lows we saw some severe underperformance there as well watch emerging markets this could be a tipping point there, maybe they got some momentum we will see if that sticks,

melissa, back over to you. >> dom, through. for more on the markets let's bring in chris hyzy. chris, great to have you with us you say that we could be in the early stages of a new bull market advance and i'm wondering if this new bull market advance will be focused on technology which is the leadership we have seen so far in this rally. >> yeah, melissa, you know, most bull market advances at least the recent ones in the last two for three decades have included technology throughout as a leadership group this time around the book end to technology is health care. the reason is technology and health care both have the highest free cash flow collectively in the s&p and to the point where almost 50% of all free catch flow is from those two sectors. you envelope that with the cyclical areas, dominic talked about that before, the emerging markets. previous to the pandemic we had inverted yield curves, we were worried about deflation, we had

a strong dollar. that curtailed any expansion during this pandemic area we have a steeper yield curve, a weaker dollar on the margin, excessive stimulus so you have this reflationary triangle to create a longer-term global synchronized expansion. >> so you like tech, you like health care and then emerging markets. i'm wondering in emerging markets because we've already seen certain areas of the world like china, korea, we've seen big advances already there and i'm wondering where you would tell clients to put their money. >> that's a really good point. if you really think about it it's a little bit of an oxymoron when you think about the world markets. you have the nasdaq and the chinese stock market are the only two major indices up for the year if you think about that for a second but in terms of emerging markets we are actually still underweight, the emerging markets just because we want to see the weaker dollar path opinion more to sustain this outperformance, but overall we still prefer the u.s. relative to the rest of the world

europe is getting very interesting, it's potentially a game changer there with a movement towards a euro bond framework. last but not least the industrials although we are not overweight there it's another watch signal and we get closer to the end of the year and the pent up demand cycle in 2021. >> does it concern you, chris, some of the moves we've seen in recent days and i'm thinking i know you are not a stock picker and don't talk individual names but a name like tesla which up by more than 40% in the past five trading sessions we had an analyst note from barclay's this morning saying they believe it's fundamentally overvalued but there's nothing to hold the stock back that seems to be the attitude with analysts regarding stocks and it seems to be the story of 2020 are you concerned about these pockets of momentum, of these huge gains and whether it could backfire at this point >> i think many stock market

watchers really take a look at these type of trends and say it's a big concern if you go before the pandemic we had a narrow advance in the market during the pandemic we saw the cyclicals and value market start to watch up, late april, a good portion of may and early june and then they became tired you need the profit cycle, you need the economic recovery to gather momentum heading into next year to see a broader market advance, but in terms of the story stocks, the story stocks right now are being utilized out there to help support the broader narrative, which is this great acceleration of operating leverage and lower expense induced areas and capx furthering technology to improve bottom lines of companies. that's all being accelerated because of the unfortunate situation in the human health care crisis. >> chris, great to speak with you. thank you. appreciate t chris hyzy. taking a check on the markets,

final check here, futures seem to have paired some of the losses when we started the show but we are looking at an open down 200 points, s&p 500 looking to open lower by 17 points joe and andrew, it's been fun, right? >> we can see what the market did at 5:00, get a summary of everything that happened on "fast money." >> i will see you all. >> we still haven't seen the kids. >> i will see you all at 5:00. >> maybe then. we have to go. >> next time next time. all right. see you tomorrow "squawk on the street" is up next. >> thanks, melissa good tuesday morning, welcome to "squawk on the street," i'm carl quintanilla with david faber, mike santelli live from separate locations cramer has the morning off coming off that five-day win streak close to one-month highs, futures a bit soggy amid signs and commentary that economic activity is moderating on new covid restrictions coming up this hour uber on the purchase of postat