taxes. it's tax day, fabiana. thank you. final check on the markets, get it postmarked at least or get an extension. let's say it quickly here are the futures before we hand it over to "squawk on the street. up about 527 points. becky, andrew, tax day tax day. do your beauty do your patriotic duty. >> done. >> make sure you join us tomorrow. >> already done, proudly. >> "squawk on the street" is up next ♪ good wednesday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer, david faber live from separate locations futures are soaring after tuesday's rally as vaccine hopes return, this time it's moderna, full phase one data, astrazeneca chatter in the mix as well then there's goldman, the biggest earnings beat in nearly a decade oil hits 41, looking past some of the dire fed commentary of the past 48 hours. we're going to make another run at 3235. >> you are so right to key on

that because there are a lot of people who just think if we can break through that then we're going to be able to say when we get a vaccine it's just going to be game, set, match for the bulls because we are already at this level without the vaccine i think that today is a confluence of goldman puts citi, wells fargo and jpmorgan in the rearview mirror. it's the old goldman sachs model. we have moderna talking up a blue streak this morning on squawk with meg making us feel like inject my left arm, please. we have the goldman sachs number that looks like the old days david faber, goldman reminds me of when -- i don't know, what, 18 years ago >> yeah. it is a report from goldman that is -- you can liken to sort of some of the earlier years of their dominance when they were only recently a public company, jim, or really let's not forget

their record quarters were actually right at the end of the financial meltdown of '08, '09 remember the numbers they printed then but this is a very strong quarter for them listen, perhaps not that big a surprise, i know i say that we've sat here and talked about the incredible activity, record-setting activity, in debt and equity capital markets and it doesn't take a genius to hear goldman sachs' name and some of the offerings that are taking place. the trading always is harder to understand and gauge, jim, and they obviously did extraordinarily well there, so their fik numbers, their equity numbers, overall banking numbers very strong. m&a my area as you know not very strong for what is still a powerhouse. >> david, do you know what they did on that fixed income index >> what. >> wamma-jamma that means they move them around they take a vig and the vig is

big and the risk is nil and that's what i liked about this quarter. >> carl, of course, its a dow component so it is going to have an outsized impact on that statistically irrelevant index given it is price weighted not market cap weighted as we like to point put the dow will be up as a result of that. but, carl, yesterday we saw a decent number from jpmorgan and we saw the stock fade to some extent and we saw -- you know, what we thought decent numbers, again, from citi, not wells. but here the question i still think will be what about the macro economic environment, what does it say with the market up, but the ten year still sitting at .64. >> yeah. that's been raised a couple times this morning, jim, whether or not -- what bonds are not getting. to david's point about goldman and macro, they do see 2020 gdp down 4.6 but up 5.8 next year which sort of is a number we would all take. >> look, i'm torn here because i

feel like that the -- when i go through jpmorgan, i go through citi, i go through wells what were they saying the future sun certain the future is murky, we don't know what the future s goldman gave you a boilerplate we don't know what the future is, but i'm looking at this number and the future is brighter than the past and it puts what i regard as being yesterday's gloom to rest. i want people -- i want to hear a conference call about a company that just says, we are -- we are awful, but we're not going to stay awful. the wells fargo quarter, it was literally line by line we are very, very negative. when you contrast that with goldman, this market has no memory, carl i mean, now you start seeing what was wells fargo, stage coach, what was that we forgot what happened yesterday, the same way that pfizer had really good news about a vaccine and we forgot about that and here we are back

again buying norweigian cruise because moderna. we had this -- moderna sold a lot of stock, maybe that was premature, that was ill-advised, but we listened to the fella from moderna and he made me feel like, okay, this is over, let's move on to the next thing. david, what is the next thing? >> oh, man, what is the next thing? i don't know >> i mean, once we are all vaccinated, david, what do we do we go to the mets? >> sure. sure why not? let's go or, i mean, with he would even go into an arena i would feel much more comfortable going outdoors to watch sport -- a sporting event. >> i have to tell you, carl -- >> i don't think -- you know, jim, when do we really think we are going to be vaccinated >> thank you. >> let's come back to that for a moment moderna, it's good news, it oaks what we saw in the even earlier smaller number, this is still only 45, 48 people, something like that in the current trial, but when do we really think that there will be a vaccine available to us that we will be able to take that we know will

be safe, that we know will be effective and that, therefore, will allow us to get back to normal life? >> have you tried to enroll? >> no. >> i tried and my doctor said are you out of your mind you enroll in the third trial. you don't enroll in the first or the second and i think that that's indicative of the fact that there could be so many things wrong and, remember, it doesn't really work unless about 75% of the people take it now, when you go on twitter, you read about things, there's so much misinformation about vaccines, but we have had vaccines that have really hurt people and i don't believe that the fda, even this fda, is going to just -- just rubber stamp a vaccine. so, yeah, i think david is right, i think this is really about super bowl time. it's not about -- it's not about world series time. >> it does bring to mind, jim, this comment that we got out of ken frazier yesterday, ceo of

merck, about the pressure in his words for pharma to put a vaccine to use here is what he said >> what worries me the most is that the public is so hungry, it's so desperate to go back to normalcy that they're pushing us to move things faster and faster, but ultimately if you're going to use a vaccine in billions of people you better know what that vaccine does. >> jim, what do we make of that? >> ken frazier has been the voice of reason on this and almost all other times i remember there was another company that had a very aggressive anti-cancer platform, anti-cancer advertisement, bristol-myers and ken frazier had the better drug, keytruda, but he would never do that he would never say keytruda is this, this, this, because he never wanted to give anybody false hope i think he is the beacon i think he understands that false hope is the enemy of what we really need because it just

creates whole family havoc so i like what he had to say i did not like -- moderna said, listen, we have to release this. we have to release this. >> right. >> they don't have to release it, what is this there a federal rule we have to release? david, is there some rule that says we have to hype it after 50 days >> of course not. >> in the constitution must hype vaccine after -- what is that the 28th amendment >> you made the point that moderna is somewhat promotional as a company they come onrong questioning from meg tirrell and people can make their own decisions as to what they're saying they are promotional, remember the stock sale as well that took place after another release of news that they didn't have to put out there into the marketplace perhaps. i would come back to merck and point out as i have many times they are more focused on the oral anti-virals that they believe will be potentially effective. eidd 2801 which i've talked about a bunch of times, roger

pea pearlmutter, is certainly positive on that they're having a different focus which may be one reason why mr. frazier is saying the things that he is they are more focused on trying to get into the marketplace an oral anti-viral that can be taken earlier if not even prophylactically, jim, that would also halt the progression of the virus very early in transmission. >> that's regeneron's goal, too. >> right. >> you know, carl, the breadth of companies, i mean, you have to look far and wide to find a drug company that's not involved in this. and notice it's an election year you don't hear people talking about outrageous prices of farm ma, but i will -- there's one document that i want to see. i want to see if anyone sold any stock at moderna today or tomorrow because that will really determine to me whether this thing has just got to be put a total asterisk if they sell stock, moderna, you don't have to sell just sit on it

>> yep, there is a form 4-s, jim, the ceo and cmo with insider sale, it seems like every time we get episodic data and it's accompanied by some stock sale, whether it's prearranged or not and dr. zax did comment on what ken frazier said when he talked to "squawk box" this morning. take a listen. >> i can't comment to his statement except to say i believe we have an ethical obligation to advance this vaccine as fast as possible given the unmet need on one hand and what science enables us to do on the other. it is incumbent on us to do this in a matter that is responsible, judicious and accounts for the emerging understanding of the safety profile and i think we're doing that by ensuring that our phase three is a large phase three. >> we should point out, jim, also astrazeneca is on the cover of business week, they're already doing 10,000 patient trials itv this morning with a piece that the lancet will have

positive news on azn we only need one shot. >> absolutely. lancet was the first one that broke this, this is a little more opinion oriented. i know everyone has a view on new england journal of medicine, pretty straightforward, which is where the moderna news came. lancet, i think, is a little more subjective. so i care a lot about astrazene astrazeneca. again, i mean, astrazeneca, that's an also ran drug company, so to speak, but they are doing great things someone is going to solve this. >> yes. >> and that's really the take away. >> and, jim, don't forget j & j, they are right in there as well. >> tomorrow. >> not an insignificant company to say the least. >> and they have built factories and have emergent bio. people think there is a vile problem, no, honeywell is ready with vials with the new material they've got. there is a gap there is this gap between when the nice things that jamie dimon talked about on this quarter, the unemployment benefits, ppp,

when that runs out and when the vaccine is that is the gap that we have to be worried about how long -- >> yep. >> how long can we go with no stimulus and no vaccine. >> yep >> especially with some key benefits set to expire in about ten days, jim, to your point. >> yeah. >> when we come back, a lot of analyst calls to get to this morning, upgrades of hrly and wells, new street high on apple, downgrade of amex and chipotle hiring 10,000 employees. back in a moment usaa is made for what's next 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

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those futures, empire looked pretty good, let's get industrial production as well with rick santelli hey, rick. >> yes, carl, empire did look pretty good, industrial production should be coming out momentarily, it's a june read. an old number industrial production goes back to 1919 and the lowest level was in april at minus 12.53. this number coming in at up 5.4%, up 5.4%, that of course follows a 1.4 at least up to this point is unrevised and 5.4 actually is a nice number considering the expectations were for about 4%. capacity utilization this number only goes back to 1967, 6 68.6

this is coming off of 64 and change, that was the worst level ever going back to 1967. so we see that both these numbers are better than expected, as a matter of fact, pretty much all data is better than expected as of late what's going on? well, let's look at intraday of ten year note yields, here they are hovering at 64.5, they just were at 65 basis points they gave up a smidge of ground but what's interesting is you look at that intraday chart is to flip it to last friday when the intraday low was 56 basis points, 2 basis points above the all time low yield close for march which was 54 basis points. even though it doesn't seem commensurate with the amount of horsepower stocks have displayed as of late it speaks volumes to the notion of trust with regard to the divergence between what many perceive is the strength of the economy versus the strength of the stock market. why does that matter

because the best hedge for that is to continue to pile into safe treadities like sovereigns, whether it's the european sovereigns which of course are also safe or the u.s. treasuries and you see that showing up in the form of lots of buying as of late the only maturity that seems somewhat insulated from that is the longest maturity, 30-year bond let's look a two day of tens minus twos, yield curve. we were having bank earnings, much of the horsepower is from trading not necessarily from, you know, the interest spreads, but what you do see that this is getting back up towards 50 basis points finally the euro versus the dollar or the dollar index, both are having rather substantial moves, one week of the euro versus the dollar, basically 112.5 to 113.5 it could be the best close since early 2019, carl, jim, david, back to you. >> okay, rick. see you later, rick santelli we want to touch on apple as well major victory against the eu as

europe's second highest court rejects an eu order to pay $15 pll in irish back taxes even as need ham goes to 450 that matches a street high today. >> there is a higher court, you have to believe that they will prosecute this this is a big win for apple. what i like more about a.m. is this needham note starts finally talking about the lifetime value of an apple customer you have macs, ipads, watches, air pods maybe unique users are $2,000. what that says to you is this run is really the beginning of what is a service company which is much stickier than an actual phone company. so the old days when tony saganeggi would say the best days are behind apple, of course, that was 100, 200, i know he's trying to keep it up at 400 but he won't be able to what it says is service company

based on a device and, yes, david, you know what that is in the old days before dollar shave, before harry's, before the plastic that you couldn't open at cvs -- >> i know what it is, it's a razor, razor blade business. >> there you go. david, you -- you -- it's because of jeopardy, right. >> i know your punch lines how many years have we been doing this show? even from distance -- at least i can look at you and actually see you over there jim, the assent of apple has been one of the features this have covid market as well. $1.7 trillion market cap only a couple days ago, backed off ever so slightly, still up 32%. you continue to be very positive on the future of the company you one thing we haven't talked about that much is $ it's so important to apple we know what's going on in hong kong, the sanctions, it's going to be a while before the sanctions take effect in terms of banks in hong kong, u.s. and

or any banks, but this is not getting any better this is only going in one direction and that would seem to be a risk for apple given how important china is to its business. >> you're right. i don't want to i'm so excited about them moving in india and how great the new cycle, the 5g cycle is, but you're absolutely right, david it's not saber rattling anymore. this is just pure 1947 cold war behavior and i think we cannot overlook the fact that there is a major deal coming between china and iran and that is not going to sit well with the peter navarro's of the world peter bend an interesting use in "usa today," i don't know if you saw that. >> yeah. >> he threw fauci under how many buses, what is the one that goes clear across m-104. >> >> yeah, the 104. he did the ones that are really long that have the accordion stretch, yeah, i think he's -- yeah, he threw him under that one. >> wow >> who are you going to take who are you going to take for your advice?

you're worrying about something or dealing with something medical related, are you going to at that you can to navarro first or fauci, jim? sn>> navarro really plays a docr only in "usa today." >> i play a doctor on tv. >> just say it, jim, ron vera could not be reached for comment. >> i like navarro is funny, he likes the buffalo bills, he is a terrific character, i knew him when i was in college. i don't know, dr. fauci seems like a likeable fella. >> we will take a break. a lot to cover here in a moment. don't go away. ♪ ♪ now is the time to support the places you love. spend 10 dollars or more at a participating small business and get 5 dollars back,

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a lot of things working for the bulls this morning, obviously vaccine news, goldman's stellar results, pretty good macro data out of empire and industrial production looks like we're going to try again to get past the levels that we managed to get to on monday, 3235 oueng lln t the opinbe i abt seven minutes.

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>> announcer: the opening bell is brought to you by nuveen. a leader in income, alternatives and responsible investing. all right. let's get to a mad dash. mister softee. >> right, mister softee. well, david, we have to start getting used to the idea of paying 36 times net shares earnings for microsoft why? because it has consistent

double-digit growth. this is a note from bemo and what i find most interesting about this note, david s we're beginning to try to justify very high priced to earnings multiples on traditional growth stocks what we don't want to do is see too many of these because that's what we did in 1999 and that's been the comparison that a lot of the whoever is remaining bears, the bears keep talking about 1999 and they say, remember, with he used to think, holy cow, we're comfortable paying 36 times earnings or 40 times earnings for cisco, 40 times earnings in 1999, are we now growing comfortable paying 36 times earnings for microsoft? i'm not. i happen to like microsoft very much, but i don't like the so-called multiple expansion aspect that we're getting right now in the cycle. >> even in a world where rates are at zero essentially or zero bound? >> if you are a strategist you can say that, that that's really what has to happen where i'm uncomfortable is that

when you look at some of these stocks, at what point do you just say, do you know what, i don't know if they can do the double digit if the economy does really slow down is microsoft completely immune from the economy? i don't think nadella would say it's completely immune from the economy. >> no, they sell plenty of services and software to companies that rely on consumers? right. >> right and those companies we know are not in the best of position right now and conceivably will be cutting back on some of these spending. >> right it's the same way there is a nice note positive about facebook this morning saying maybe advertising has traufd advertising hasn't traufd if we get to the situation where the ppp and unbenefit benefits shrink back and we don't have a vaccine you are going to a hole. the hole is best described by jamie dimon's conference call. people wanted to hear the traditional jamie dimon and what they got was something that said it's an untraditional,

atraditional recession but please don't get overconfident because i'm not overconfident. this microsoft call could be overconfident. i'm using it as a paradigm there are many others that are like that. >> carl? >> yeah, jim, you know, listening to you talk about what dimon said, i'm looking back, one of his quotes, the recessionary part of this you're going to see down the road and that couples with what brainard and barkin and bullard and hashi harker said yesterday. i wonder why you think they're prepping the market with more stimulus do we think we're going to run into hard times on august 1st? >> when you look at how much forbearance was asked for it was pretty low when you look at the number of ppp, the companies that took the ppp, it's very high so what you start thinking is there's this -- mnuchin, the treasury secretary correctly bridged things, provided we have

a vaccine quickly, but otherwise, i don't know, some kept when we start getting reports in october for this quarter, the next quarter, i think we're going to say, wow, it slipped back. and that's why you can't be overconfident here unless moderna is on a faster track than we realize. >> and, carl, as we listen to those opening bells, just real quickly remember almost one in five new cases of coronavirus around the world came from three states, florida, texas, and california we haven't seemed to mention that yet this morning. the case counts continue to mount as do the death tolls. >> absolutely true, david. 62,000, as tom lee says this morning, the shock value of having 60,000 new cases a day is kind of wearing off to some. there is the bells at the nyc, robo global health care technology and innovation, at the nasdaq it's go health, a health insurance marketplace celebrating its ipo and we will talk to the sq the ceo on "squa

alley. it is tax day, jim, we never managed to get that shifted to september so make sure you file. >> i remember going to -- used to be there was one place, it was the roosevelt post office in manhattan, that was the place you could do it at 11:59 i used to rush there, oh, man, i got the time stamp i made it. those were the days when you just frantically you have the shoebox of receipts. dave, remember the shoebox >> yes, i vaguely do remember the shoebox, why he. >> putting together all those things. >> yes. >> i don't -- so many things now are done on intuit and it's just like that and i'm jealous of the people who file these days look at this market. i mean, once again, remember we had a big update yesterday carl, these numbers, you know, there will be a lot of people that have been to be converted to bulls pretty soon. >> yeah, and it's one of those days, i mean, it's almost written for you, jim carnival leads and kroger is almost the number one laggard

along with clorox and netflix. >> right clorox, mccormick was pushed very hard today, but that's the stay at home we're going to go buy spices to bake and it opens up high and probably finishes down. >> guys, a bit of news to share this morning on the deal front you know, during that period of march, april, may we watched deals fall apart we watched buyers walk away, we watched a number of things head to court, we also have continued concerns about deals that are still out there as unlikely as it would seem that there will be a potential for the buyer to walk away, tiffany, for example, or actually in that case even just get a lower price but i come back to this because four scout today agrees to a new deal with what was its previous buyer advent international, the old deal was 33, the new deal 29 you may remember advent basically said, no, we're not buying you anymore just kind of walked away and lawsuits ensued in delaware and they've been getting to that,

but rather than actually continue the adjudication there they agree to a new deal at 29 so that stock is going to be up, it is halted, i've still got it halted right now so we will keep an eye on that because it will be able to close with relative -- relatively quickly i want to make sure i see when they actually expect to close. but, again, one of those deals that we saw and some of them stuck, right l brands, sycamore, that just didn't happen and they were able to walk away by mutual consent, surprisingly this one a lot of people said advent did not have a strong case at all, but rather than go through that and it had been moved up because there was a timing issue as well, four scout agrees to reduce the price by 4 bucks a share. >> david, how about the vaccine read that is simon properties. what is going on. >> let's take a look

i haven't seen it this morning, jim. >> it flies. every time the robin hood crowd, i don't know what you want to call it, they instinctively reach for simon when they hear there is a vaccine somehow they feel that people will start going to the mall again. same people who buy gap stores think it's going to bring out value. >> you mentioned it in light of the fact that this deal is getting done and talk about litigation, of course, that we're not going to see for a while when they finally do get to that, but simon walking away from the taubman deal, many people wonder about the strength of their case, jim when you see that stock come back you wonder, well, maybe it won't feel as bad about having to do it in the first place. >> that's exactly what i was thinking vaccine says deal good, no vaccine says what the heck were we thinking. that is beginning to be -- when you start talking to ceos, carl, off the desk, it's really the discussion is now about pfizer and mow dederna, the discussions

about j & j. it is not about, well, how about politics i never hear politics, all i hear about is vaccine. >> interesting. >> it's one of the unique challenges of this period, the binary outcome i heard you mentioning retail a moment ago rb the c upgrades gap to outperform even as pvh is cutting 12% of its workforce athleta they think is worth a lot. people think there's real estate value here it's easy, very good no et from rbc today. it is interesting what people don't want to own when they feel there is a vaccine coming. they don't want to earn costco, they don't want to own amazon, shopify, same way. nvidia one of my favorites, that's a gaming chip and data center who needs that there is a vaccine it's not like that it is not like wherein individual i can't is going to do poorly if there is a vaccine,

but animal spirits go to royal caribbean because people feel, do you know what, sail away, come sail away, we've got a vaccine. >> right and i guess for today the banks are actually seeing a broader-based rally. yesterday not the case despite what were stronger than expected numbers from jpmorgan and arguably citi. not wells fargo. again, today the earnings are from goldman sachs, they were a blowout. stock is has backed off from what it looked like in terms of the increase you can see there kind of part of the pack at this point in terms of a almost a 4% increase. maybe it comes back to this, the provision for credit losses was $1.59 billion for the second quarter that compares to $214 million for a year ago they are now at $4.39 billion in total allowance for credit losses, provisions related to wholesale loans and they say to a lesser extent consumer loans reflecting revisions to forecast in the deterioration of the broader economic environment. >> i thought they're being

conservative. >> you do? >> yes, i do it doesn't matter because in this environment as soon as you see any loan loss that jumps out people take a pause. by the way, wells fargo, charlie scharf, he really was speaking about expenses, he was talking about getting -- that the bank is fat and unhappy and the reason why we got an upgrade today was that because charlie said, listen, i'm going to cut out $10 billion. how are you going to cut out $10 billion? what do you do >> that's a big number. >> isn't that big? >> fat and unhappy fat, drunk and stupid is no way to go through life. >> if i worked at wells today i would come in, i would say, i don't know, maybe -- >> it's not great. >> resumé. >> by the way, they do have an enormous deposit platform. goldman did add $20 billion in the second quarter they are now at $92 billion that's marcus which still is giving you better rates. >> and does not have a lot of loan losses. that's algorithm, has done a good job, better than people

algorithms are better than people apple card they put the brakes on, tapped the brakes. they could have done a lot more business with apple but i think they want to be a little more conservative, again, because people are concerned that there's going to be this gap jamie dimon had this great line he said, look, i don't know what's going to happen when incomes -- first recession where incomes have jumped. 16% to 17% of people have higher income in this recession but that does end. carl, you are right to keep mentioning that because it's really coming upon us. i don't know what the economy is going to look like by the way, it's not like suddenly, do you know what, i'm going to cancel that trip because no one is taking a trip any wra. cash balances go up because no one is doing anything. what is there to do? you can't go to the movies what do you do are you guys doing anything? >> no. >> july 25th is a -- in ten days, obviously, and it sort of brings to mind the downgrade of amex, jim, over at jpmorgan, they go to underweight, second

high profile downgrade in a week citi went to neutral the theme is higher income consumers in this case doing less discretionary spending, stuck at home, not traveling, t & e, underperformance. >> i thought that was a good call, people have underestimated the dramatic decline in t & e. i'm trying to find out from the banks what would happen if people worked at central headquarters, jamie dimon thinks that's a good thing, i can't believe goldman was able to trade from home. goldman -- these guys, they are in their pajamas making a fortune. i do think that home depot has been the barometer of where the money goes stanley works, stanley, black & decker people are doing things at their home, they're gardening, that's tractor supply, david, i know that's one of your favorites. >> always of course. yes. >> tractor supply has the best set of gardening gloves. when we go -- that's right, i forgot you don't do anything. >> i don't do a thing. >> all right. >> nothing except at 6:01 i start to do this, but i do wait every day.

>> what is that? >> you asked what we do earlier. what do you mean what is that? it's not gloom forget the zoom drinks. >> oj? >> it's oj i had that fancy tequila last night with that beautiful bottle. >> yeah, that's killer, man. watch out. i charge $25 a drink at my bar the bar, sorry. >> the margins on that used to be great. >> people were blind for three days from the other stuff. carl, we haven't talked about oil going over 40 with an opec meeting. >> yeah. >> suddenly those people jus can't resist they just say, hey, do you know what, it's chevron's time. honestly, guys, battery day, september 22nd, battery day could cause oil to drop $5 i'm talking about elon musk with battery day, earlier was supposed to be in april but does it matter? it's elon musk we're just -- we're going to

have a battery that lasts ten hours. >> it's his simulation, we are just living in it. >> he doesn't like me. i don't really care. a lot of people don't like me. >> guys, every day i'm going to mention spacs because they are the thing now. i want to go through the quickest, the latest on all spacs. there's different justations, you announce that you're going to mount an offering, file an s 1 to create the blind pool of capital that then you are going to go out and do a deal. this morning we have fortress value acquisition corp. which is already an existing spac announcing their deal. they're buying rare -- this company mp materials, a rare earth company and it's going to have a post-transaction equity value of about a billion and a half that one we can see how the stock is doing deer field health, large hedge fund, small spac, focused on health care, that's their area of expertise at deer field that's a small raise hpx, this one caught my attention. why? well, for a number of reasons,

but, jim, one of them is simply that it's 20 million units so it's about 200 million bucks, the founders are bernard ohees, carlos piani and carlos xavier remember bernard, do you remember how the stock did during his tenure from '15 to '19 at kraft do we have the -- do we have that graph i was hoping we did. >> anybody can get money. >> anybody can get money. >> cheese wiz. remember he was going to buy unilever. >> there it is you have that going for you. that's the period of time that he was -- by the way, this is what they say they're going to do and, off course, you have to focus on that, they expect the management team to deploy a proactive thematic sourcing strategy and focus their efforts on companies where they believe the combination of the founder's operating experience, deal making track record, capital markets expertise can be catalyst to enhance the growth

potential and value of a target business there you go. >> wow they left out fintech, artificial intelligence and machine learning and cloud. >> why not throw those in there. tomorrow we will probably get ackman's gigantic spac at least sort of hitting. this is, again, a continued area of focus, an alternative for companies to go public, remember, and the process is you raise the money first, so that's when we talk about the offering, that's what's happening with this pricing of this deal we were just talking about and then you obviously do the deal. we will see how fortress performs today as well and, guys, real quickly on corelogic, they did have that meeting yesterday, corelogic's management, some directors as well in cannae and senator they want to be able to do due diligence, they want a level of customer level diligence, they are not getting that from the

guys at corelogic at this point who say, no, raise your bid first, then we will give you diligence. in fact, it's the other way from the other guys, they're saying, no, give us diligence, then we might raise our bid. theres a look at corelogic at 67 other private equity firms scrambling out there at least to try to figure out if they want to try to do something here. no formal process obviously under way at this point, unclear whether there will be one, but you can act by special convent and call a special meeting they may do that as soon as they are allowed torques june 28th. carl >> guys, with he got above 27 k for the first time since mid-june, goldman leads the dow, retail and travel lead the s&p let's get to bob pisani. hey, bob >> hey, carl essentially flat, remember we are back 3230 is where the s&p was, we are essentially there, sectors, banks have a good day as david mentioned they normally dip during this week when earnings season comes out, up today. regional bank numbers were fairly good, industrials leading

energy, so you see cyclicals up, techs are lagging, mega cap is mixed this morning, consumer staples also lagging as carl mentioned the reopening stocks are strong. it's important to mention how these things are like ping-pong balls, the big travel names, hertz's and united airlines and carnival cruise line stocks they are 30% to 40% off their june peaks and 60% in some cases 70% off of where they were in february so whenever you see these numbers, these big moves up in daily, remember, on a competitive basis they are still pretty weighed down here the market has a problem right now, it's very confused on what it should be looking at. look at the s&p, it's moved in 100-point range in the last couple of days here. and we're sort of at the top end of that trading range that you see, but 100 points, 1,000 points in the dow, that's a lot even by the standards we've been getting used to in the last few months two things competing for market attention, the five buckets we

always talk about and what moves the markets overall, the big treatment is the treatment and vaccine story and essentially what's happening if you look at the market, the message of the market, we are all in on a vaccine and a treatment. that's why the market is holding up so well the problem is the reopening story, the other major mover, it's a reopening or reclosing story. brainard got attention worrying about double dip she has credibility and that note was widely passed around about her comments here. debate about how intense the stimulus is, mcconnell seems lukewarm on going over $1 trillion, maybe to the $2 trillion level nobody is sure what's going on there. china tensions, david mentioned this, it's ratcheting up, reducing special status for hong kong is an issue and trade is an issue still floating out there and as for valuations, what can you say? most opinions on the street believe tech is overvalued right now but in the absence of a complete shutdown the market is saying we're putting all our chips on improved treatment and a vaccine and valuation, okay,

they're right but interest rates historically low as for the banks take a look on the upside, at least the opening was on the upside here i think the key here is focus on the regional banks u.s. bank corp. and pnc had higher provisions not as bad as wells fargo, that's a good sign. pnc are talking about a 2% to 5% decline in revenue we are starting to see trends with regional banks, i talk regionals not the big money center banks here are some of the trends that are pretty clear higher provisioning for loan losses, wells fargo is an outlier. average loans are lower, fees tend to be lower that's an important part of their revenues for regionals and net interest margins generally weakening. goldman sachs this is a trading operation 50% comes from global markets that's the trading operation it was 58% above

analyst estimates, that's how far off the analysts were, even investment banking they were way off. this is a blowout quarter. goldman sachs does not have a lot in common with the regional banks like p in. c or u.s. bank corps back to you. >> thanks. goldman sachs the second biggest dow gainer at the moment right behind raytheon. we will take a break as we did get above 27 k for just a minute, hanging on to 3232

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the former fed chair has a message in the wage of the pandemic it gives states billions and you help the entire country. that's the title of his op ed. he says congress must act decisively to avoid repeating the mistakes of the recovery from the great depression. we talked about consumer fiscal cliffs at the end of the month there's going to be state fiscal cliffs as well the health care costs alone have been incredible. >> there's no turning back you spent all this money for individuals, but you've got to safe the health care system. i think people are really ignoring that's just a black hole there's a lot of people who seem to be unrealistic about what this has done to our economy

and what it's done to the states i think people have to pay attention to it. by the way, if you want a great piece in the new york times, jim stewart did a piece yesterday about epstein and deutsche bank and named names. mentioned the people who really made this guy, let this guy get away with it at deutsche bank. highly recommend reading it. it turns out banks are not faceless there are individuals who do terrible things. i'm not going to name them because i'm jimmy chill, but you must read it it's spectacular it's the first time i've seen people being outed for being really bad people. >> deutsche bank any road, half the time when something bad is going on, it seems to lead back to deutsche bank >> it does it does. what kind of compliance do they have rubber stamp it blows in the window -- >> >> yep, and in some cases

they had come from other banks as well. >> yep >> look at the s&p look at that year to date. s&p positive again by .5 first time since june 8th the s&p has been green ♪ (announcer) reliability is everything. so, if your network's down, you're down. verizon knows your customers need to reach you seamlessly. your team needs to work from different places across many devices. plus, you want the security trusted by some of the largest companies in the world.

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marriott among the top five. more "squawk on the street" in a moment

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let's get to jim in stop trading. >> you may not know robin farley works at ubs she was negative on harley davidson she upgrades it today and says it's time, even though it won't fix the demand problem, remember, this is an outdoor stock. people might see vaccine, you won't do it. i went to a harley store two years ago. i brought the demographic down earnings per share okay. but the fact is i love it when a bear goes to a bull.

hog. >> they announced layoffs. i think they branded in the ak, they called it the rewire. it points to everything we talked about companies trying to increase operating leverage through layoffs. >> a new ceo taking no prisoners. i think for those looking for a travel stock that hasn't really moved yet, get on board harley it's fun my friend haley has one. they are a blast to ride on. >> jim, how about tonight? >> biohaven, this man is a hero to a lot of people it's a pill. i take it. it melts in your tongue. about 15 minutes later the migraine goes away it's extraordinary and it's just a miracle for those who have migraines, biohaven is revered. 40 million people.

pop. it doesn't taste bad it's kind of like a cert >> anned advocate for it >> i talked to sara eisen. she didn't know about it a long time ago i'm trying to get people to know about the cprg drugs allergan has one now too >> see you tonight >> harley. >> see you later >> welcome to "squawk on the street." i'm carl quintanilla with david faber and leslie picker this morning. interesting market day again the vaccine hopes plus goldman and good macro data, as the dow inches up. to a large degree, it is largely about moderna, astrazeneca and the hopes for a vaccine down the road >> that seems to be reflected in the broader market averages being up almost 1% and the s&p

basically flat for the year. moderna is up sharply on the promising results from the study of the experimental vaccine. meg is here with the latest. >> this is the full phase one study of moderna's covid-19 vaccine. in may we got a glimpse at the data it's only 8 of the 45 p participants worth of the information. here we have the full data set it looked at 45 healthy participants between the ages of 18 and 55 and got two doses of the vaccine 28 days apart. they found every one of the volunteers generated neutralizing antibodies. the antibodies that actually keep the virus from being able to infect cells. at the dose level they're taking into phase 3, they found the levels of neutralizing antibodies were two to four times higher than those two

recovered with the disease this wasn't without side effects. a lot reported fatigue, chills, headache and muscle pain they are proceeding toward that 30,000 participant phase three clinical trial projected to begin july 27th. this is a fast pace for vaccine development. and there are still questions that remain including how protective the neutralizing responses they saw will be and how long that protection will last we asked a chief medical officer that question this morning on "squawk box. >> if you look at the average levels at which we can achieve the antibodies, it's at or above what you see in people who were sick with coronavirus. that's important because to the best of our knowledge today, if you've been sick with covid-19, you're unlikely to get sick again, at least not in the near-term future, based on the

data we have today >> guys, this is a brand new virus, and scientists just don't know yet how long protection will last after infection or, of course, with any of these vaccines that's why we're going to need the trials to tell us. back over to you >> meg, something else a phase three trial does is give you a much larger as you pointed out group of people to test it on. one of the key things with the vaccine when you're giving it to hundreds of millions if not billions of people, you want to make sure people who are not sick aren't going to get something serious. you can't figure it out from 50 people maybe from 30,000 you get a better sense as to whether there's somethingout there that's unexpected that would happen that would be an adverse effect >> yeah. experts that i talked to in the vaccine space say the 30,000 participant trials should give us a good view of the vaccine's safety initially one of them quoted the famous vaccine developer who worked at merck and developed many of the

childhood vaccines we take now he said he doesn't feel comfortable or breathe a sigh of relief until 3 million people have been vaccinated this will be watched over a long period of time and people will be tracked but they'll assess the initial safety in the large studies. >> meg, thanks i'll talk more about potential vaccine and how it's impacting market trading let's bring in sam stillval and gina sanchez this morning. >> good morning. >> sam, it's a tough play book how do investors manage the binary outcome of whether the vaccine works and whether it works on time to avoid a sharp drop off in economic activity. >>l wall street is saying we're going to get a vaccine in 2021 perhaps the expectation is

sooner in the year rather than later. when we're focusing on second quarter earnings and realizing a good majority of the stocks in the s&p 500 are not offering guidance, analysts are having to work for their pay but when the bar was set as low as it was down 45% year on year for earnings in the second quarter, i think it's challenging not to exceed what those dire estimates have been and so far that's exactly what we've gotten >> gina, goldman is a great example. the low on the street for the quarter was maybe a buck and a half they come in at 6:26 -- 6 .25. is that a hope that the rest of the quarter is a beat. what's more important, the print or the commentary that follows >> well, i think the lack of guidance certainly helped get a lot of analysts overly

pessimistic and set up as sam said, very, very low bar for this quarter i think that guidance is necessary but we're unlikely to get that, and i'm not sure companies are willing to come out and say by the way, we're probably beating because we have stimulus effects that are actually padding the q2 number a and q 3 and 4 are probably not going to be as good as you expect the idea that by 2021 q 1 we're in positive growth territory i'm not sure that's going to happen >> a lot of people look at that and say valuation is essentially becoming secondary to momentum we look at names like tesla and how it's surged in recent weeks. does that indicate frothiness to you? >> it does certainly indicate concern and confusion, because when you look at a 25 multiple on the s&p 500 on forward 12

month earnings, that's a 50% premium to the average pe over the last 20 years. you probably have been hearing commentary about the fed model recently where you take the earnings divided by the interest rate for investment grade bonds, and you can pretty much justify the valuations by saying okay, we're likely to see a 20% plus price appreciation in the 12 months ahead so with so much uncertainty out there in terms of guidance, you sort of have to take the market's lead because as the old saying goes, prices lead or anticipate fundamentals. >> analysts have been doing that as we've seen some of the increases in their targets in recent days. fed officials, though, they seem to be getting more of this down beat commentary in recent days, gina is that a net positive as it indicates the potential for more stimulus or is it net negative because they're trying to say something about where the economy is at right now?

>> well, this is a double edged sword. what leads you to more stimulus is bad news. and the stimulus that they did pass is having an impact one of the reasons that q2 is probably not as bad is because you had a significant amount of stimulus now we're facing defaults and aaway a wave of evictions and layoffs that are going to come after ppp measures are done. and so i think while the markets may view negative commentary and negative guidance by the fed as a potential for more stimulus, the reality is that it pushes out the likelihood of a recovery sooner rather than later and it gets harder and harder to justify the multiples even with low interest rates >> how is that going to play out? i mean, in realtime? do we really expect fed officials or powell himself to come out and say you know what we think vaccine development is

on a real track and we're going to start to pull back now? >> i don't see them saying that at all my feeling is the fed has been acting like the character in the movie my body guard. whenever problems seem to arise, then the fed comes in and says we're going to do whatever it takes to make sure that we put a floor under this economy i think gina is correct, though c that it's sort of like a drug addict the more stimulus that you get, the more you will need to keep the market moving. and so if we continue to get additional stimulus, then that could be a problem longer term for the deficit. >> yeah. gina, that's interesting you know, there's a debate in some circles about whether the fed is actively worried or concerned about inflating asset bubbles. at some point comments powell has made suggest it's not at the top of their list of concerns or worries right now. >> well, i think the fed is very

misguided, and many central banks have been misguided about how they conceive of inflation targeting. inflation targeting assumes all the monetary stimulus printed into the economy makes it into goods and services pricing what we have observed over the last two, three decades is that, in fact, that excess supply goes into asset pricing the valuations are being justified by the excess money, but there's no value being created. i think that's the bigger problem. >> that's going to be a topic we'll discuss more and more if hopefully we do get progress on vaccines sam, gina, thanks. appreciate it. >> my pleasure thanks >> thank you goldman sachs handling beating on the top and bottom lines. the shares up about 1.6% >> certainly beating on both lines. the most pronounced part was on the trading front.

a massive 250% rise year over year jpmorgan yesterday rose 120% citi 70% 2 $.9 billion in equities. that's up. also strong. jpmorgan up about 40 % citi's was down. the investment banking revenue of 2.7 billion also strong they did see provisions rise from 940 billion to 9.1 billion. not enough to derail the optimism the shares as you said have paired gains at 1 .7%. pnc and usb out with numbers usb numbers with strong beats on both lines less increase on provisions for him. pnc, the stock high. not as bad as wells fargo. yesterday it was a question for the regionals to answer. wells itself also reversing a

lot of yesterday's losses. so positive vaccine news no doubt helping this cyclical sector today that despite still uncertain macro outlook from management. here's goldman sachs' david solomon. >> the path to reopening in many states and corresponding economic consequences remain unclear. since our april earnings call, our economist estimates for 2020 gdp improved from expected contraction of 6.2% to 4 .6% today. driven by expectations of a faster rebound from a deeper trough that said, on a global basis, growth expectations for 2020 deteriorated from an expected 2.5% decline in april to a 3.4% contraction expected today >> the sector is up strongly today. morgan stanley and bank of america to come tomorrow you know, a bit prizing

goldman, again, only up 2 % now the stock is up. i was going to say surprising goldman's tepid response to strong numbers i point out i think you may have mentioned it, book value 227.31. that's below book value. i would assume a continued frustration for management we'll see what we get tomorrow from morgan stanley when they report earnings. >> one of the reasons it's paired back, we got the rest of the call, the first question as you would expect was how sustainable are these extraordinarily beats in revenues and the answer, again, saying it's unlikely we'll have the same type of scenario we've seen over the last three or four months for the rest of the year. one of the factors that's probably weighed on the stock, still higher as you said with the book value and the question mark for morgan stanley and goldman sachs where the results are good and we're still below book value, we'll

see if it continues. on that point, clear in the opening remarks that returns, return on equity, return on assets would have been better if not for not just the provisions point that everyone was looking at but the litigation points they look litigation costs as well we don't know what's related getting close to the settlement. we don't know. but the returns pretty good for goldman sachs as you say, if we're back to double digit returns on a sustainable basis in the medium term, i doubt it will be trading below book value for long >> if v you noticed a difference in tone in the second quarter versus the first quarter, especially as it pertains to the economic recovery? >> yes i think there was uncertainty at the end of the first quarter, but it was more focussed on particular sectors that's broadened out perhaps the depth of the uncertainty has eased a little bit. but the most stark difference i would say was from the early june last updates from management at various

conferences which was more positive there was a more clear improvement in positivity from the end of q1 to early june than on the conference calls. there's no doubt there's still great uncertainty on the outlook, and that's why it's surprising when you see the whole sector reverse today versus yesterday without any clear change in turn other than the vaccine news, perhaps. >> thank you for that. we continue to monitor the comments we're getting out of goldman. when we come back, the risks of reopening amid a pandemic. we'll talk with the ceo of a restaurant chain that operates in states experiencing spikes in co-vid cases we'll have more on today's market gains in order for today to be the best day since february 21st, got to hang above 3232.39. we're back in a moment

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(music) anncr: give customers access to precisely what they want, when they need it the most. with adyen, the payments platform that delivers convenience for all. adyen. business. not boundaries. co-vid cases have been surging in the sun belt region in terms after 7-day case arch, florida is up 27%. record number of deaths yesterday. georgia up 38. alabama case counts up more than 48%. joining us this morning the ceo, scott davini

h we appreciate your time today. >> thanks for having me. >> you guys are in 17 states and i imagine managing policies in state to state that differ in big ways can you talk about the complexity and where you see things >> it has created a major challenge for everybody. straupt brands included. our company we spend a lot of time researching each individual either municipality or state to figure out what the rules are. and so when you have 160 restaurants operating, you have to be mindful of what each individual city or state rule is relative to gloves, masks, social distancing. is dining at 25%, 50%, are they allowed in we've been monitoring it from the middle of march.

75% of our business is franchise. you have not only what we're tracking but each franchise owner trying to make sure they can keep up with what's going on it's ever-changing sometimes you get a note at noon that at the end of the day you're shutting down dining rooms and we have franchise owners having to scramble. >> right walma walmart is going to start requiring customer face masks beginning july 20th. that follows best buy and starbucks. are you beginning to sense more clarity on a national level at least on masks themselves? >> well, i think it's inevitable, and some of it's mandated some of it is the business is trying to protect their team members and their guests what we do now is we require masks for all our team members, and then we have traditionally deferred to the local municipality guidelines. some would require masks and

some would not what we're seeing is most are moving to masks, so when we're in restaurants, most of our guests walking in the door will have a mask on we have a few that -- and it's probably 10% to 20% that don't have a mask and don't wear one some will tell you they forgot it generally speaking for the most part, every one of our restaurants, you'll see everyone in a mask. >> i'm curious about your customer count if you seen a diminution of people walking in, specifically where there are rising case counts >> when the shutdown happened, clearly our dining business went to zero. we're traditionally a heavy lunch spot with about 60% of our business in the dining room. we went to zero. now we had to then move to other models which is more bulk delivery and tickout we've been successful.

we were positive going into the middle of march for the year that's following 16 straight quarters of positive sales growth, and then march hit and we all fell off the cliff. we're currently year to date down about 14% so not as bad as some others have been, but that speaks a volume to the brand and the brand value we have and really our guests that really want our product, and we offer them a way that's more in bulk packaging as well as normal sandwiches. the guests can come in and pick up two or three of pound each. they can have a product for a couple days. some other brands don't have that as an option. >> right i know coming into this year you had significant growth plans do you continue with the same plan or has it changed in terms of new store opens >> well, it's a little bit of the resilience we had tremendous growth plans

last year we opened 40 new restaurants. our plan this year was to open 50 we were on pace. we opened 11 the first two and a half months. when march hit, everything shut down believe it or not, we have opened six new restaurants in the month of june through yesterday. we opened yesterday a new restaurant in east pea your ra, illinois it was a fantastic opening a great crowd. we will still plan to open a total of 30 to 35 restaurants in 2020 which i think puts us in certainly rare category. opening brand new restaurants this year. >> scott, do you think the government has done enough to support restaurants during this period of uncertainty and is there more you need from the federal government as you look toward the second half of the year >> well, it's interesting. we don't really know the deep extent of what covid-19 means

for really everybody and so i think with all of this happening so fast, and we're moving a million miles an hour trying to come up with medicine, vaccine, whatever, we're all just trying to do the best we can, and our industry along with hotels and airlines and others have been traditionally hit really hard with this. so it's not necessarily fair for me to say the government has done a great job or not a great job. i think with the ppp program and some of the other things they've done to help keep restaurants afloat has been very, very helpful. is it enough to sustain every mom and pop or even some of the smaller brands out there time will tell it really will be more dependent on can we get our society to a point where we're okay wearing masks, getting into public and going out to eat the social distancing has hampered the restaurant industry lately because 50% capacity or 25%,

some brands will simply not make it >> right to that point, and we've been talking about that sort of theme in retail especially where the big get huge and the smaller basically get smaller or go away completely today chipolte, i know you know quick service, they're hiring 10,000 people over the next few months to staff up the need you get from digital operation and takeout. and i wonder if you see that happening, too, where the big players, the national players are going to take share away from mom and pops? >> well, i think the -- the trend for what i would call specialty boutique, or brands like chicken salad chick, those have been growing over the last several years. our brand is very much in its own lane fresh made chicken salad in each restaurant every day, monday through saturday we're closed on sunday

we have been taking share we feel like from a lot of different restaurant chains as we've grown. and now all the sudden demand is still high and you have limited supply so by that natural course, you are going to see some of the larger brands that can sustain that will take share from the local mom and pop and individual chains it's just the way it will be, because those smaller guys are having a hard time staying open. >> scott, thank you for the clarity and insight. we hope to have you back appreciate it very much. >> thanks for having me. appreciate it. now time for our etf spotlight. ticker xlv up this morning about a percent. and now positive for the year. rebounding from the massive drop in march united health reporting an earnings beat. the company saying the second quarter profits more than doubled helped by a lower medical cost due to the fall in health care utilization followed by lockdowns and social

distancing the stock currently up about half a percent we'll take a quick commercial break. stay with us

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welcome back here's your cnbc news update

walmart will start requiring masks for shoppers at all of its stores starting next monday. it will have what it is calling a, quote, health ambassador, with special training to find a solution for customers who arrive without a mask and may not want to wear one a late reprieve for a convicted murder set to be executed today his lawyer says he suffers from dementia and no longer understands why he's being put to death the case is likely to go to the supreme court. in new york city police is looking for whoever deheaded a man. he was found by a relative who says the body parts were found in bags and an electric saw was nearby gruesome you are up to date i'll see you in an hr.ou "squawk on the street" returns after a quick break. this is decision tech.

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we're awaiting results meantime our next guest is here to discuss how to invest during a paendemic with us now is global head of black stone growth john. thank you for joining us >> good morning. thank you. >> okay. you and a group of investors including oprah, natalie portman, howard schultz paid 20 $0 million to invest in oatly. what's it like to be a growth investor right now especially in the middle of a pandemic >> yeah. it's always a great time to be a growth investor. especially in this pandemic. it's excellent you see the s&p 500, the faang plus stocks are up equal weighted measure is down 10%. there's a flight to quality and

it's rewarding of growth oatly and our previous investment in bumble, these are examples are that are consistent focusing on industry leaders with world class management teams that are well served for global network >> according to a new bank of america survey, we've heard a refrain for quite some time that as the crowded trade and people are looking for a reckoning. does that concern you as you try to figure out some sort of price discovery for the assets in which you're negotiating with? >> i think growth companies are always coming at a premium in general there's a survival bias for companies you'll always be on the full side of a fair price we try to solve that through portfolio construction growth equity investors in general invest in a massive number of companies where it's an index fund. if you're investing in 25

companies a year, you can't do anything other than be subject to tail winds. microinvesto microinvestors, we pick three or four situations where we believe we have a unique ability to add value. we can be insulated at the surface and we try to solve our exposures by being microinvestors >> as you look at the market for potential exits, the ipo market has seen deals recently. we've got the parent company of quicken loans and rock space, a full schedule for a summer in the middle of a pandemic as you look at what's going on with ipos and in the aftermarket where you see stocks doubling in the first day alongside some of the uncertainty, how you assess that market as you continue to pursue deals and look for potential exits in the future? >> yeah. i draw encouragement from it this is a situation in which the market is celebrating growth as i mentioned earlier there's a

survivor bias for the companies. this is where the strong tend to get stronger if you look over history, there's an innovation bias in growth equity where you'll find yourself on the right side of history. a lot of the recent ipos are good examples of that. >> john, it's david faber. you said earlier you look for opportunities where you have a unique ability to add value. given you're not approaching this like an s&p 500 index give me an example of something that would give us a sense of how to add value >> the first is our portfolio construction it's up pended to the operating resources afforded by having the capital. we am mortize at a larger base and apply them to a smaller group. we procure on behalf of hundreds of thousands of people

we save meaningful amounts we have an ability to cross sell within our eco system with the largest owners of real estate in the world. to the extent we look at a company or the largest e-commerce logistics assets. if we can look at an asset light logistics company that can sit on top of our $40 billion estate of warehouses, it allows us to stand in ways that we're looking for synergy. and we tend to be the main if not only source of capital in the team i think it's another way in which we help the value with the manager teams. >> yeah. all the warehouses seem to have been a good purchase what do you typically see as a hold period for you? what do you go in expecting that you will be a significant investor in terms of time period >> we don't go in with a preconceived notion for

fundraising timelines. we believe you have to take an extended horizon especially in the growth area where the worst thing we could do is introduce arbitrary fundraising cycles in doing so, hamstringing the ability to make investments in companies. we go with a long-term horizon an average investment for us is about five years >> john, one of the refrains i continually hear among the private equity world is managers are in the middle of this pandemic focussed on some of the problem children within their portfolio and not able to have the bandwidth to go out and source more deals despite things ready to put to work typically a distressed environment is the best time to do that. how do you see it playing out in the growth world, and the growth side, how do you go about

competing and what does that mean for valuations? >> i think you're right to point out the dry powder is not the issue. everyone talks about the dry powder and taking advantage of the dislocation. history tells you that the rate limiting step is your bandwidth. over the last several cycles, i think the again in 2007. and 2019 arguably, we as an industry did. the bigger sin was not having invested enough in '0 1 to '04 '09 to '12 and 20 to 2323 as the makings of another gold era the challenge was people did not invest enough with trough vintag vintages if they did, it would have dwarfed. the challenge at the time was the traditional growth model with a partner sits on five or ten boards, the same head winds

that created the trough are the same ones creating fires in your portfolio. the bandwidth is distracted. when the tail winds to put out the fires, the tail winds eliminate the trough we have a unique ability not being burdened by a legacy portfolio that we can play offense and partner with companies who i think in the volatile times who see benefits of aligning with a super tanker like black stone >> if you had told me at the outset of this pandemic that four months later it would still be raging and the s&p would be up for the year, i might have not anticipated that i'm curious as to what your thoughts were coming into this and did you expect to see such f fertile ground for growth investing? >> there's an opportunity for innovation in terms of looking at the s&p

500, what i take away, there's distorted affects. the monetary supplies at 23 % year to date as a result of that, that's the largest infusion of capital in the system i think it's making equities look comparatively better. in some ways it's dangerous to extrapolate where we are as an s&p. and we're also celebrating the rapid rebound. you had an april retail sales followed by a surge in may to the highest in history i think our group thinks it's too early to extrapolate a full recovery it's probably more of a square root i think the stimulus distorted things some problems may be going into the future growth companies will continue to benefit we're going after things that are not trying to -- we look at secular trends that are not going away, and we don't invest

in trends. >> thank you john for joining us >> thank you so much all the best guys, watching market levels at this hour 3227 it's going to take you back to february market sit agent the highest levels since the pandemic began. we're back in a moment

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change research latest states of play survey showing a majority of swing state voters supporting stimulus rounds of payments >> david, that's right some striking findings now in the latest cnbc poll polling just the battle ground states here to get a sense of where this presidential election might go and what we're finding is the idea of additional stimulus payments is overwhelmingly supported 81% of the respondents in the battle ground states say they prefer additional stimulus 95% of democrats say they support additional stimulus and 68% of republicans that's the surprising number, i think. that many republicans support additional government spending to support the economy you wouldn't expect republicans to support that, but in this case, they certainly do.

and then the president's response now to the overall virus situation, this number is under water for him. 43% of the people approve of the president's response on coronavirus. 57% disapprove of the way he's been handling it on the question of whether the president is helping your pocketbook, this is a bellwether economic question for a president. 47% say yes. 53% say no, the president is not helping your pocketbook and that adds up to a job performance number, the approval rating for the president just 45% that's the lowest that we've seen so far in this poll approval rating of 45% for president trump at this point in the campaign i should make clear that what we're surveying are likely voters in the battle ground states that's more tight of a group than the broader question of vot voters generally the voters we think will show up

in november. we're seeing a different read on the poll than in other polls nationwide a tighter race, but bad news for the president going into november, early, though. >> as we saw last election, the swing states matter. >> that's right. a quick programming note as we head to break tomorrow cnbc in partnership with acorns is hosting a virtual live town hall special bringing together americans affected by the current health economic crisis financial experts will answer their questions to help them reset and rebuild their financial futures. that's tomorrow at 7:00 p.m. eastern. we'll be right back. st wh ayitus introducing stocks by the slice from fidelity. now you can trade stocks and etfs for any amount you choose instead of buying by the share.

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let's get to steve liesman

looking at how the resurgence in covid-19 case is slowing the pace of economic activity. >> good morning. yes, a definite impact from the resurgence on the high frequently economic data we've been following let's look at the roadback economic data. let's get a look at the road barometer. starting a new metric here this pushes through 13 high indicators from one week you can see it's down 37% from the baseline of february 28th. and that number, the improvement has nearly slowed to a crawl, up just 1% on the week. moving to the right, one of the components to that, the home-based employment index for three states, three hot spot states, texas, florida and arizona, down 30% in terms of employees working. and all other states down 23%. there you have a direct impact looking at over time, in the next chart, you see the blue line, those three states

actually led the nation in putting employees back to work now, they lag. those two bumps were on the left, one on the end there, those are the holidays, memorial day and july 4th we can't get rid of those with the high-frequency data, but those three states lagging the rest of the country. and credit cards, jcpenney credit card, it's gone down since the peak you see the card present data has gone flat to down. increase in the card not present, people shifting again to online spending with resurgence i want to show you the resurgence in those three states, texas, arizona and florida, all with big numbers with the increase in the coronavirus. a very important finding in jpmorgan and one we have not seen anywhere else they correlated spending in restaurants with a three-week lag with a surge in the virus. let me read you the quote from

the analyst who did this he says, we continue to see that the pullback in spending since late june has been widespread across states. with higher levels of spending, especially card present restaurant spending have seen more rapid growth of the virus in subsequent weeks. guys, there it is. we can't say that correlation is causation, carl. but there is a direct connection between people returning to restaurants and three weeks later, a surge in the virus. carl >> yeah. that chase card data, 30 million cards has provided some really interesting insight into the economy, steve >> yes >> thank you our steve liesman looking at the resurgence in covid cases. taking a look at apple today, almost back to 389.82 which was the all-time high earlier in the week. major victory in the eu with the court decision on thtas.e xe and needham reaching a street high

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with some offices and schools seeing people return to work and school common touch points and cleaning protocols are certainly a focus. facility services company s & w services working with clients to safely reopen. and the ceo joins us right now paul, what are you doing now that you weren't doing prior to the pandemic, in terms of how you go about cleaning a facility >> well, i think it was a series of solutions that we've beenal plying for our clients in all different sectors that we work with them. some of them are proven and some of them are emerging as they emerge, we've learned to understand them and adapt them so, most recently, there's a lot

of talk about aerosol transmission, which in the industry it's been suspected since the start of the pandemic. we've been talking about fresh air, including the increasing the amount of fresh air which comes into a building which traditionally, air has been recirculated, changing the ratings on the hvac in handling equipment to the highest rate possible, something called a mer-16 that we're recommending using older technology like uv lights which can help kill the virus and bacteria, if applied 30 minutes to a space. and then some really new stuff called bipolar ionization which had been fit into duct work and is known at a 99% rate to kill the virus when it's airborne so there's some things that we're doing on airborne transmission, along with a whole

host of other solutions. when you add them all together, that create a safer environment for us as human beings, to go back is into these time of spaces. >> yeah. all of that would seem to me, as well, to amount to more costs. are you able to pass those costs on to your customers who conceivably are also facing tenants who perhaps are not paying their bills, or colleges, for example, who are under duress as well >> well, i'd say, here's what we're doing, work with our clients to figure out what are the most effective ways to deliver these services of course, there are increased costs when you apply more labor and more technology to combat this particular virus. but there are other things we can do to help our clients offset those by adjusting some of the things we might be doing for them to try and help but, no doubt, there's an increased cost and i think at the moment, you've got to look at, you know, balancing safety and ability for occupants to return to space, whether it's members of the

public, or whether it's students or whether it's us, as an office worker you've got to be able to balance all of those things and try and offset those increased costs with some efficiencies but at the end of the day, safety matters here, i think that's what our folks don't mind >> with the vaccine in the near term, do you think companies will continue to keep the any cleaning measures in place or do you think they'll go back to way things were prepandemic >> i think pre-vaccine, we'll see these continue i don't think anyone responsibly is going to want to look to save money at the cost of people's safety and i think we all as human beings are going to expect that from the owners or managers of these buildings that we go into. and i think post-vaccine, i think it's unknown i think post-vaccine, i don't know whether we're going to see some movement back and some regre regress. but i would hope that many of these things will stay, because

we're all now, i think, far more knowledgeable about what safe environments feel like and i think we're all going to demand of those buildings owners, at the highest standards of safety for us all >> paul, thank you for taking some time with us this morning appreciate it. >> thank you for having me >> paul bedborough i want to take a quick look at goldman sachs and the banking industry interestingly, coming into with the goldman numbers, one would have thought that stock would be the strongest performer. not the case it's the weakest, wells fargo, up 4%. evercorp. isi, perhaps bottom-fishing there, but not reaction to the numbers which are were very strong but tempered by the ceo david solomon and on the company's conference call. >> you're right, david which did focus on lowering noncompensation expenses

lowering people in other parts of the world in attempt to lower the expense structure overall. we'll watch gs all day thanks to leslie picker as well. good wednesday morning, i'm carl quintanilla with jon fortt and julia bornstein. we'll go back to february, basically flirting with the highest level since the beginning of the pandemic in late february and intermittent highs that we got in june. of course, tech stocks remain a focus, the managing partner at kenred ventures. thank you for the time good to see you. >> good to be back >> we've got this interesting cocktail and macro data is pretty good. how do you funnel all of that information into eye aplaybook that responds directly wit