this is one i mentioned as a final trade before, we've talked about it before. it benefits from infrastructure. any sort of infrastructure bill, this company is well poised. 1.5% dividend, $200 stock. it's op pportunistic. >> that's "halftime report" for today. "the exchange" begins with kelly evans right now. netflix, chipotle, amazon, facebook sound familiar is th they're the names hitting all-time highs every day tesla is in 45% in cessation plus the social media giants are taking a stand in hong kong, but are they on a collision course with the world's biggest consumer market, china we're going to look at how this could impact their bottom line

cruise lines banding together in real estate. we do begin with the markets and bob sezoni has some numbers for us bob? >> this is typical, kelly. a very similar pattern stocks tend to underperform. tech te techs get overperformance. bank stocks have been weak today, energy stocks these are all classic cyclical names. tech has been doing a little bit better overall we still get microsoft, we still get amazon doing relatively well staples also outperforming walmart, by the way, they're loving that walmart announcement walmart plus is what they're announcing here that's going to launch next month. early access to product deals, low fuel is this a competitor to amazon prime? walmart is up about 5% that's pretty good news in a

market where we're down overall on the year. but it's still mega caps, folks, new highs on apple, new highs on microsoft essentially here, and you see performance day after day. only amazon is down slightly but it was up earlier in the day wells fargo looks awful. it's below its march lows, one of the worst performers in the s&p this year. and even the regional banks like fifth third, they're down $13 billion in market cap. look at the s&p versus the bank etf today. you see s&p is down 2% for the year look at that, the banks down 30%, more than 30% on the year need a little better news here, guys, for the banks, but it's tough to find right now. guys, back to you. >> all right, bob, thank you, sir, bob pisani. how are people supposed to make sense of the market where names like tesla are on their fifth day of all-time highs and

having a mega run. what does it mean for the staying power of the whole recovery rally let's bring in bill smead. and president of kumar global strategies bill, i'll start with you. this seems like a natural place for a value guy to pour cold water on everything. >> well, you have to remember the market can stay insane longer than you can stay solvent. so we're long only investors, and during times like this, you must be guided by what charlie monger says. he says envy is a lousy sin because it's no fun. so i'm not going to envy the people that own tesla and own netflix and own amazon what we're going to try to do is to be set up in things that we think will do extremely well by the way, kelly, as a reference point, the extreme in valuation was in late '99 and early 2000

the bank stocks were incredibly depressed then also in relation to cisco, microsoft and intel. we took a look, just used wells fargo as a reference point wells fargo went from 19 to 26 in '00 to '02. during a huge decline in the market market,up, starting from a very depressed level. >> let me bring you in you have by some counts some of the worst coronavirus numbers we've seen i think it was shopper track saying spending was down the worse yet year on year in their survey that all sounds like we should be experiencing a market like we did back in march, but instead we keep climbing to new highs. yes, the tech trend kind of benefits from stay at home, but what do you think it going on here in terms of the overall

economy? >> kelly, good to be back on your program, and i think the macro picture to me is a lot clearer than some people have explained, mainly that you haven't gotten out of the deep hole yet you're going to have very likely a secondary wave of the virus. nobody is talking about a vaccine until at least early 2021 when it can be effectively administered all of those say to me that in the second half of the year, you have a significant leg down for the equity market. so as for what is happening with tesla and other stocks, i don't look at specific stocks, kelly, but it reminds me a lot of the second half of the 1990s when alan greenspan said, suggesting that you would have a greenspan put. the boom raged on and people said valuations don't matter then we end upped with a dot-com bust and the recession of 2001

it is a lag of when you perceive it to be valued and the time when stocks actually take a hit. but the s&p 500 anywhere from 25 in future earnings, even the market cannot support it for too long >> both of you are about this period being analogous to the 1990s, but it seems like you're ov overall negative on the economy. >> kelly, it's so interesting the way most of the media spins the current information. so, for example, i'm from the state of washington, and then i also spend a lot of time and now

have a headquarters in phoenix, arizona, so i'm watching both of those. state of washington was a hot spot originally and has had an uptick lately but nothing spectacular compared to before and arizona kind of became a hot spot and florida, california and texas. well, in florida, the governor just came out and said the average person being tested positive is 33 years old in the state of washington, 1% of the deaths or 14 people below 40 have died 1% of the deaths, and that's of 2.5 million people you have more chance of winning the lottery in washington than you do of dying of covid under 40 so the media loves to prey on the most negative statistic

involved, and right now that is cases of positive tests. and then they go, yeah so in our opinion, the economy will recover over the next 18 months, and you will never get a better price on economically sensitive stuff than today or the next three or four months if we continue going crazy on the misery stocks and that would be the beneficiaries like apple and amazon and netflix they are the misery stocks they love those stocks because they prey on the misery. >> so you're saying you think this is the time for people to buy stuff that's much more industrial, cyclical materials, that sort of thing, and i know pfizer, discovery and american express were some of your top picks. sri, let me bring you in for some reaction to that. i'm seeing bill is more

optimistic you're more cautious why do you see the ten-year yield going back to previous lows, less than 1% with gold rising by the ounce? >> i don't see a recovery. at best you'll have a u-shaped recovery with the bottom being in 2020. you're nowhere close to the bottom that's one reason why i think it's too early to rush into optimism as far as the stocks are concerned. look further you have an election-related risk november 11 is a crucial date and president trump is not only trailing on a nationwide basis but also in some crucial swing states the market has no idea what it will be to have a democratic

president and especially if you have a democratic senate as well, and you have all of the senate, the house, and the presidency being in democratic hands. one way to look at it is to say that when november 3rd comes, the markets take a big drop, or you say you anticipate that the move is coming and you prepare for it right now i think 2021 will take, assuming a bite in the administration, it will take a lot of recovery to cut the excess we have in the current administration we have spent too much on companies, too little on individuals, but as they do that, those measures are going to be beneficial for the long term and they're going to be very negative for the equity market in at least the first half of 2021 >> so you're definitely in the camp that sees election risk gentlemen, we will leave it there, some areas of agreement, some areas of disagreement

sri-komar and bill smead, we appreciate it. the government and the warp speed program is to give government spending. meg tirrell is here. meg? >> reporter: they announced $2 billion in grants to these companies, one for a vaccine and one to scale up a drug for covid-19 let's start with novavax $1.6 billion to support taking the vaccine through late stage clinical trials, including, if all goes well in the earlier studies, a 30,000-participant phase 3 that would start in the fall also the funds will be used to scale up manufacturing and supply of the vaccine with the goal of 100 million doses being available start ing in late 2020

if all goes well this vaccine just started human trials in may in australia, so we need to see those results before we even get this far down the road this is the largest award so far under operation warp speed the previous largest was $1.2 billion for astrazeneca in may they also awarded half a billion dollars each for barda and the department of defense. now they're starting up their antibody drug. they say initial doses could be ready by the end of the summer if these trials go well. this is a drug being tested for prevention and treatment different drugs need to be available for each of those because you need more drug for treatment rather than prevention but regeneron is saying in this contract the initial lots it's

funding here would be provided to patients at no cost who need these drugs. again, if all goes well in clinical trials. this data should be available at the end of the summer. >> it's interesting to find out who has gotten funding and when. should we read anything into the fact that companies like moderna didn't get funding this time around that reward was made two months ago. >> that's a good question. that was made early before the human trials really had much data, so i don't know what we should read into the timing and how much companies need and how much is, you know, involved in purchasing doses so we might see more sort of awards coming from the government as they get closer to that part of this process. >> yeah, but you can understand why investors in novavax are certainly excited at how big of a check that is. meg, we appreciate it. thank you, as always meg tirrell with our coronavirus

update today coming up, social media giants are making bold moves in hong kong in response to china's new security laws there. we'll look at the impact of their bottom lines plus it's a question on every parents' mind. will kids be going back to school in the fall we'll speak to a teachers union about what needs to happen for them to return stay with us save hundreds on your wireless bill

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welcome back president trump is scheduled to hold a meeting this afternoon on how to safely reopen schools it's something educators across the country are trying to figure out and we're getting new insight into what teachers say needs to happen. ylan mui has more. ylan >> reporter: we got a feel of how teachers feel about returning to school in the fall. they surveyed their members and found that two-thirds of people social distancing is happening too quick and that sped up the spread of the virus. a majority of higher education teachers say they support a hybrid model for the classroom, something that combines both in-person instruction and virtual learning however, both groups say they would prefer 100% online versus

100% in person even though teachers overwhelmingly acknowledge that distance learning is just not as effective as being there in the classroom with the kids. so, kelly, what we're seeing is how to reopen the schools is becoming politically charged, president trump tweeting that schools must reopen this fall. meanwhile the aft finding that his approval rating is falling among the members. back to you. >> we'll bring in randi wi weingarten she's president of the federation of teachers your own teachers acknowledge that online teaching has been a failure and really want students in the classroom what would you tell a parent who says how do i get my kid to safely go to school every day of the school week? is that possible >> it's not possible, but the other survey document that was really important in this survey is that when you say to both parents and teachers, what about

using the kind of cdc guidelines of physical distancing en masse to make sure everybody is safe as well as actually, you know, fighting against community spread like new york has done so successfully when you see that, 76% of teachers say they're in for going to school. because teachers want to teach kids they don't want to deal with president trump's political agenda you know, we have been dealing with this since april. we put our report out about how to reopen schools two months before the pediatricians, but all of a sudden, because biden was at an nea conference, now president trump is rushing to come up with guidance today. >> but here's my question going back to the original one which you answered succinctly, i asked, how can parents send their children to school safely every day, and you said no

so what do parents do if their kids are home a couple days a week or half a day is there any other way, can you use the hybrid way of learning to get them to spend time in school more safely >> this is why we think unless we can have actually the double number of teachers and double the number of spaces, what we have been told by the health practitioners here and abroad is you need about six feet of physical distancing. that means that you have basically 50% capacity in schools. and ultimately, that's what bars are doing, that's what offices are doing, and that's what schools have to do, and the states that understand this are starting to plan for it this way, but that's why we actually need money from the federal government for the -- you know, for the ventilation, for the ppe, for all of these kinds of things but what i'm saying is that teachers who know that remote

doesn't work really want to help their kids and really want kids to be engaged in school, so we've been trying to figure out how to make it work. the people who are problematic here are the administration who has done actually nothing about this, and now as we're getting closer and closer to the time school is starting, now they're trying to pass the buck. but i don't -- >> let me bring in ylan mui for a question here. ylan >> randi, you mentioned the cdc guidelines but there's also been a lot of attention paid to the recommendations of the american association of pediatricians who are now saying that 3 feet of social distancing is an acceptable compromise for students in schools. is that something that's an acceptable compromise for teachers >> the only -- so the pediatricians have gotten that from the w.h.o., and the w.h.o.

will also tell you that you have to actually really reduce community spread, which is completely -- and you have to really have masks that are being worn by kids we haven't seen that guidance other than the w.h.o. anywhere else in the world. and, in fact, what's happened in the world that's gone back to school is that they have really reduced community spread completely contrary to what's going on in the united states, you know, in places like texas and in florida, and they started off really slowly with young kids to see what was happening so, you know, we've talked to the pediatricians last night they are concerned that their guidance is being used to say 3 feet is a max, not a minimum, and what we're saying is if you do 6 feet, then you'll actual the get to 3 feet. the real issue is how to make sure that kids or teachers are

not aerosoling -- i'm sure i didn't say that word right -- >> spraying of particles, absolutely ylan, let me ask you a question. it does make a difference if it's 3 feet or 6 feet. if it's 6 feet, you can have 10 people, if it's 3, you can have 20 the math does change if it's 3 feet, maybe you can get kids in school for more hours of the school day. doesn't there have to be some effort to make sure that especially if they're not at huge risk themselves that we're not overcorrecting here? >> but what we don't know is we don't know -- so this is what's interesting. all of a sudden, the 6 feet rule, which has been important for bars, for office buildings, for hospitals, for all of this, we are now actually easing it for kids this is the issue. we don't know what really is safe for kids or for teachers.

what we do know was that the 6 feet rule en masse really worked for child care for essential workers during the months of march and april. so the teachers of this country, you can see it from that chart, they want to go back to school, they know that it's important for kids we just want to make sure that we do it safely, and that is why we have been fighting for the safety considerations as well as the money since april. >> randi weingarten, thank you for joining us today >> thank you yla texas cases are spiking. the owner of 11 texas restaurants is here to share his concerns including lawsuits. plus the country is banding together against the cdc their stocks have been hit hard this year, down 60% across the board. we're going to hear from ceos of

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welcome back to "the exchange." take a look at what's going on across the markets we're close to the lows trending lower. the dow is down about 205 points right now. about 239 was the low. s&p lower as well. nasdaq is eeking out a small gain tech is the best today tech naturally speaking four are in the green today. what does that leave, six or seven in the red you guys can do the math financials are down 1.4%, continuing their string, i should say, of weakness that bob pisani was highlighting as well. let's get to sue herera for our update hi, sue. >> here's what's happening at this hour. more than four dozen florida hospitals have now reached capacity in their intensive care

units as covid-19 cases continue to surge the data comes less than 24 hours after governor ron desantis said the state's outbreak had, quote, stabilized. nearly half of all the fbi's countercases with now related to china with a new case being opened roughly every 10 hours. christopher wray said china is a long-time threat to long-time vitality experts from the world health organization will travel to china this week to research origins of covid-19 and how it was originally transmitted from animals to humans. secretary mike pompeo said the video platform may soon be banned in the u.s., along with other social media apps, due to data privacy concerns. for more on that controversy surrounding tiktok, you can head to cnbc.com. a lot of teenagers will be unhappy about that

that's the news update about that kelly, back to you >> snapchat has the potential. >> exactly covid cases continue to spike in texas one week after governor abbott reduced restaurant capacity back to 50%. the state recording another 8200 cases, up 40% from the previous day. the seven-day average for cases is now surging more than 25% since the reopening testing has climbed more than sixfold while new cases has risen more than sev sevenfold. it is projected that 37% won't make it through this pandemic and that sounds low based on studies we've heard lately the owner of free range concepts operates 11 restaurants in the state combining experience with a dog park, bowling alley and live music it sounds like a great time normally speaking, but a terrible place to be doing business right now tell us what it's been like. >> i think we can all agree that 2020 has been a mess so far.

like you said, my concepts are generally a good time. we do in texas right now, currently restaurants are able to operate at 50% capacity indoor dining, and then outdoor spaces, as long as you're practicing the 6-feet social distancing, there's no limit so in my case, my restaurants are large outdoor spaces, sometimes exceeding 25,000 square feet in patio, so i'm uniquely positioned, but the restaurant industry as a whole has been, obviously, and everybody knows this, it's been decimated by the limitations, and we obviously, as restaurant operators, we understand why we have to be cautious and why we have to social distance and why we can't open at full capacity, but it doesn't mean that we aren't disappointed by it at the same time. because obviously there is tons of jobs that are being affected and tons of livelihoods. people save their whole life to

open their restaurant and you're watching your family life savings kind of, in some capacities, go up in flames. >> no, it's so sad every day we flip through the papers, there is another story about a restaurant closing down. you drive through town, you drive down the highway and you can see it you had $50 million of annual revenue that went to zero overnight. let's talk about the impact on your workers you did apply for and get a ppp loan are you able to, then, keep people on payroll? what's that experience been like, and what's going to happen if you can't have, you know, kind of normal operating capacity in the next six to nine months here? >> sure. well, obviously no industry and no business model works at 50% of total revenue capacity. so long term, we've got to get back to doing what we do, which is serving our communities we did get ppp money which allowed us to keep our thousand team members employed this whole time, which has been great but from a business standpoint,

that doesn't really help us, because we still have rent, we still have utilities, we still have taxes, we still have all the other expenses, and if you don't have any revenue coming in, it doesn't work. so we're really hoping that something comes legislatively to help the restaurant industry in particular, because this industry has been really the only industry that's been targeted for some reason, and i think we know why, but it's been the only industry that's been targeted across the board and been forced to shut down we haven't seen that since, really, prohibition. >> no, it's an interesting point. you're talking about legislative solutions here one of the other concerns that you have and a lot of business owners have is what happens if i'm operating under the rules, somebody gets coronavirus, turns around and sues me for it? that, i think, is a big question hanging over the economy >> sure. well, i think it goes a step beyond that, and we're already seeing commercials on tv, have you been affected by corona?

so there's these class action lawsuits that are trying to form against businesses, and frankly, whether you contracted coronavirus in any business, it's hard to prove that. really, these are just class action lawsuits targeting businesses, which we need, and this is not just the restaurant industry -- businesses need some sort of protection from this because there are a lot of times where you might have an unscrupulous lawyer that's looking to make a buck at the expense of business owners >> yeah. kyle, we appreciate you coming on to talk about it, share your concerns your house is lovely i can see why your restaurants are successful >> thank you very much i appreciate you having me on, kelly. >> keep us posted. kyle noonan is the owner and operator of freerange concepts down in texas. a thousand brands have paused or stopped advertising on the site we'll look at what's at stake.

cold is hot if you're in the warehouse business plus the mlb and the $500 million man. it's all cing omup after this on "rapid fire. california phones offers free specialized phones... like cordless phones,

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- ( phone ringing ) - get details on this state program call or visit welcome back let's catch up with a couple stories that should be on your radar today. it's "rapid fire." let's start with julia, mark zuckerberg is set to have a meeting with civil rights lawyers at 2:00 p.m. eastern time zuckerberg and sandberg will make demands for the boycott to

nearly a thousand brands including players like coca-cola and verizon. julia, what should we expect >> i think they'll be talking about the demands of the organizers of this boycott, and facebook will be talking about the progresses already made. cheryl sandberg and mark zuckerberg have both made it very clear they're not just folding under pressure, that they've really tried to minimize hate and racism on the platform for a while, and they're sort of reiterating that they're not going to do anything because of pressure, they're not going to be making changes because of financial pressure, but they want to do the right thing so i think the issue is what they think is the right thing is not yet enough for these boycotting companies and the organizers we'll see what comes out of it in a couple hours. >> seema, does it really matter? can facebook let this blow over or not >> to julia's point, i think there are a lot of people out there who want to see action that statement from sheryl

sandberg appreciated, but is it too little too late? this boycott started two weeks ago. >> julia, we'll check back in with you on that reporting as we get it let's talk about what's going on in the cruise industry. they're launching a joint task force called healthy sale to address covid health concerns. it's always interesting to see two competitors do a joint interview. here's what the two ceos had to say exclusively to miss seema earlier today. >> there will be changes, but i think the changes won't undermine the fundamental fact that people are buying a cruise for a moralist experience, and we understand we need to deliver that moralist experience >> they'll be docked they're wanting to cruise with us we believe that the long-term viability of this business is intact, and we're going through a rough patch with this virus, but we're confident this rough

patch will not last forever. >> seema, it seems like they're getting frustrated and they're saying, we're tired of waiting and waiting and waiting, we want to come up with regulations to have a plan to start sailing >> we're tired, too, following these companies. it's been four months since the cruise lines were halted in mid-march, and still no concrete recommendations of what cruising will look like in this pandemic era. that's why they brought the two rivals, norwegian and royal, together to create this panel of experts who can help guide them in these discussions with the cdc, but kelly, it's a really tricky task. they can update their protocols, but they need customers to have that level of experience and not dissuade people from booking a cruise >> especially in the cruise industry, what we've heard from these companies, they say nobody can really remember which cruise company you were on, which cruise company had a problem these industries go up and down together

it's not so much one company versus the other, it's the industry together in a way they're not so much competitors, they're competing against all the entertainment sources out there. >> absolutely. julia, what were you going to say? >> i just think it's really remarkable, kelly. if you think about what it means to be on a cruise. remember a couple months ago when everybody was sick on those cruises and they were quarantined together, and to think about what the future of cruises will look like they talk about maybe you have an unlimited buffet but you don't let people serve themselves or maybe instead of going to a crowded port of all, you only have visits to private islands this is not only going to have to transform behind the scenes but other things >> if you can't go to a buffet, who wants to go? >> there are other activities, of course, that travelers partake on when you get on a

cruise 21 bookings, they say they are strong which shows people wanting to go on these cruises one high-growth area of the market has been warehouses and now it's hotter or colder than ever diana olick, what's going on >> reporter: to keep direct to pharmaceuticals, the u.s. needs up to 100 million more square feet of cold storage warehouse space. that's according to cbre that's roughly 6100 new warehouses, like this one being developed by scout capital outside philadelphia new cold storage needs to be much closer to inside cities, why, because we all need everything right now the demand for supermarkets, online orders, way up. the average age for a cold storage warehouse is 43 years

old, so the whole sector needs a facelift with more automation. there is just one dedicated cold storage, that's americold, but other big storage companies like pro logics have an ability to do a box within a box that's called storage within a regular warehouse space. this is going to be big, big demand over the next couple months and years kelly? >> i'm just looking to everybody else for a reaction. you get seema's take on a cold storage play here. >> just listening to diana's report, the stock has done really nothing if you look at the year to date performance and even the 12-month performance of the stock. but also cold storage extends beyond warehouses. it's scan innners, it's technol, it's the things the cold storage travel in. >> kelly, remember when the big companies went to the arctic circle

it reminds they that all of a sudden maybe cold storage will take off now maybe all of a sudden in a year or two, there will be a couple more. >> once there is an etf, you know the trend is over, you know the easy money has been made thank you, we appreciate it. what is the world telling us about covid? will there ever be sports again? more players across baseball especially are opting out of the 2020 season entirely as frustration over testing and covid grow eric, this is a template, because baseball is kind of first, then basketball i suppose then football. >> baseball is interesting because they're not using a bubble these teams will be in their home facilities and traveleding to their road games. a lot of teams haven't been able to practice, they don't have the results of their tests, so you have a leaguewide issue here the star players, they're not even sure the league is going to make it to opening day >> julia >> i think this is going to be a real opportunity to use technology the most cutting edge technology needs to be deployed across all

of these different leagues, whether it's the rings that are being tested out to monitor temperatures or whether it's contact tracing. but i do think that this is an opportunity to figure out what the future of sports looks like, and especially if people start coming back into stadiums, how you make sure that people are tr tr transacting, using mobile payments for everything. >> we have to go, but if by chance there is not an nfl season, does patrick mahomes still get paid >> there are a lot of ifs in that 5 million we'll see if he actually gets paid >> don't you think given everything going on, we're still going to have sports >> dr. fauci said the worst sport you could create in terms of contact and this whole covid thing is football. if we can't get these sports off the ground, forget about

football >> fair enough they're trying to save money on his big contract thank you, guys. that's it for "rapid fire" today. zoom and netflix is part of the stay at home trade, but look at this stock. it's up more than 80% so far this year. we'll it look at tlook at the c the other self-starters after this sales event. lease the 2020 es 350 for $359 a month for 36 months. experience amazing at your lexus dealer.

welcome back to "the exchange." when we talk about the stay-at-home trade, the same stocks keep coming up over and over but there are names out there that fit the mold but may not be on your radar. here's a look at some of the lesser talked about names. rbc points to the company's carbon black acquisition as a path for market share gains. they're up about 70% from their 52-week lows and two cybersecurity plays are crowd strike, which has more

than doubled this year and more than tripled from its 52-week low, and aqua. for more on the list, you can head to cnbc.com/pro we may be in a covid state, but it hasn't stopped people vying for business and jobs. scott has more on that scott? >> hi, kelly viewers know on this day in a normal year, we would be updating our top states for business the cdc has decided against doing that this year, but make no mistake, states are still battling one another, and this year it has taken on a whole new dimension. even as some states were still shutting down in the spring, massachusetts was already planning how to open up. >> what's going to happen when we get through this hospital crisis and how do we get back to

work safely? >> co-chair steve yuka led the council to produce a 72-page recovery framework back in april, bringing together business, science and government, covering everything from testing and treatment to who goes back to work when >> we felt that if you didn't take a holistic, systemic approach, you weren't going to solve this >> reporter: across the country, states are stepping up, some drawing on past experience, like new york after 9/11 and louisiana after katrina. >> you saw states really snap to it in action and be pretty proactive. >> reporter: now every state has some sort of program to retain its businesses through the pandemic but site selection consultant tom stringer says states and companies are also starting to look ahead, with talk of moving manufacturing back to the u.s. >> site selection is in full swing again. we're a leading indicator, so we typically see people either spending money or retracting from spending money.

probably 12 to 18 months before it hits the general economy, so things are starting to move again. >> stringer says this is all very preliminary we obviously don't know what else the pandemic is going to throw at us. but it just shows in this battle between the there's no rest for the weary >> there's not somehow i'm not surprised. it's great report. we appreciate it still ahead, tik tok is pulling its app out of hong kong it's the latest social media company to take stand against the chinese government and we'll discuss the future of tech ties to china, next bl ng

. welcome back a slew of tech companies have suspended processing government access requests for user data and hong kong after china imposed a new security law on the city they include facebook, google. tiktok is taking it a step further saying it plans to pull out of hong kong completely. i'm joined by editor and chief at the verge the really confusing thing about this is tiktok pulling out of hong kong to protest a law even though it's owned by china >> tiktok is outside of china operation. there's a similar app that operates inside. stakes are large here. we never had tiktok in this app era that is made by a chinese company and become a global

phenomenon here in the u.s i think tiktok is trying to make an argument it's the new digital hong kong. it's chinese but it's global it's based in china but not beholden to china. it's not clear whether they can allow that they don't seem to be allowing it for actual hong kong. then there's the question does tiktok sort of have to pull a taiwan and split off in the digital realm from china and what will the implications be of that >> seems like bit of intentional posturing to say we're so not owned by china we'll pull out over hong kong. >> it's basically tiktok we have a lot of users in hong kong they can use that or be fine we're going to separate tiktok

out in western countries, particularly in the united states they can be comfortable that this was designed not to share data back to china tiktok has ceo it's now a ceo of tiktok the question is whether they can actually maintain virtualize separation or really pull it apart and say this is a country that's not headquartered in china. it has roots to the chinese company. that's a big question for them >> the tiktok issue is interesting because it's to popular and because it's chinese owned. let's talk about the other big tech companies those who are pausing or suspending cooperation with hong kong how many of those are not operating in china what happens to those doing so and will have to face the chinese going back to say you can't operate in china you can't. >> you hit the nail on the head there. the question is whether hong kong is part of china.

i think the companies are wrestling with that. the united states government doesn't have a strong position it's taking matters into their own hands. i pulled some numbers on the big three you mentioned. google had 48 data requests in hong kong. there's not the same data for twitter but in the first half, twitter had three data requests in hong kong the question is whether under chinese control with this new national security law those numbers are set to skyrocket i think these companies are saying before that happens, we're going to take a breadth and decide whether we want to keep doing business in this market which is effectively part of china we're already not in china the loss of business is not a big deal and we could not be in the spike. >> most of the companies are not already operating in china it doesn't represent a new threat necessarily john, we should pivot to talk about the potential news today about mike pompeo saying they would consider banning tiktok here in the u.s. what should we watch for in terms of next steps on that

front? >> i think we're on the verge of a digital cold war you've got the chinese way of doing networks and apps and surveillance and government authority and then you've got perhaps a western play in a weird kind of subplot here they want the kinds of access to those things that the chinese already have whether it is tiktok, this popular consumer app based in china that still trying to be global the decisions that get made here could really have broad reaching implications for the next decade >> absolutely. snap shares, american company, up more than 7% on these headlines today. john, thank you. that does it for us. coming up, billionaire tilman is back he's join us with latest on the reopenings or not of his restaurants and why he's getting

more and more concerned. i'll see you with bill griffith for power lunch right after this short break.

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welcome back this is power lunch. welcome aboard most of them under pressure. look, the nasdaq holding onto gains with names like amazon, apple and microsoft. all at record highs. speaking of record highs, tesla on track for its fifth straight record close