of the best performing asset classes. i think it can continue amidst a backdrop of geopolitical uncertainty, inflation fears, u.s. dollar weakness, enormous stimulus, so i think this is a great investment still >> got a name for me john ajerion? >> dsv >> thank you kelly, "the exchange" the all yours now. >> thank you, scott, and welcome everybody. earnings season isn't exactly clearing things up for the markets, it's making things murkier. xerox says they're no longer expecting an inflection mark as covid spreads. pfizer announces a late stage trial for a potential covid vaccine. we'll speak to the ceo ahead

also cars, paint and free food in coins. dom chu here with the numbers. >> yes, ma'am. we are just a little bit on the negative side today. you can see here the major indices off by marginal amounts. the dow industrial is down 87 points at the lows today we were down 195. not that much in the grand scheme of things still, though, the s&p 500 just about flat and the nasdaq off one quarter percent. the pulldown for the dow and s&p just over 1.2% in the last trading days take a look at this particular thing we're watching first of all, advanced micro devices is a stock you want to watch after the closing bell it's report earnings it's part of the red hot semiconductor industry vaneck vectors is up a big move for semiconductors.

we'll see if that move is justified after the sound of the bell 3m comes out with disappointing earnings shares are up about 4% it's worth roughly 45 to 50 points in the down side. in the dow today, though, look at the trade we've been stuck in with 3m. we'll see if any kind of action happens for 3m going into the next quarter >> thank you, dom. the outlook is getting less clear for corporate america. they were hoping for a pickup in the second half of the year, but xerox is now becoming in question xerox said the continued uncertainty around the spread and resurgence of the virus has changed our prior expectation for an inflection point following the second quarter according accordingly, we now expect a slower pace of gradual recovery in the second half of the year

neal, i'll begin with you. what is your expectation fort back half, or is it even possible to have one >> i think there is, kelly you have to look at it in terms of how a manager manages his money. this is where an active manager takes advantage of the index with this coronavirus pandemic that we have, there is a lot of opportunities, because what you're looking for is personal trades that are changing so you look at people that are staying home, remodeling, putting in garden beds, finding appliances, so like a whirlpool. or you're looking at people moving out of the cities because there's no nightlife you could look at a toll brothers you could look, for instance, at crown holding that he with talked about a little over a month ago that makes beer cans now there is a shortage of beer cans not to be funny here, but an active manager has to think outside the can in order to make the client money in the end

game and that's the difference where we are now there is a lot of good companies to buy even within this pandemic >> neal, you're confident you can make those picks and have that longer term view, that kind of view on how the world is changing, and not just say, i'm going to buy big tech and ride that out, because that also seems to be a winning formula. >> kelly, if you look at big tech, you look at amazon, apple, google and microsoft, just take those four companies and that is about 12% of the gain in the nasdaq this year but more importantly, those four companies would add up to being the third largest stock exchange in the world the u.s., china and then those four companies in front of japan. so you just can't buy an index, you have to look and figure out where are we going in the future and who can make money being if this pandemic ends or continues to go forward. >> on that note, dave, let me bring you in i know you guys own microsoft,

you own facebook, you own alp alphab alphabet, yet you also own home depot and sher wwin williams, which is having a nice day what are your thoughts on those tech names and how you see the back half of the year shaping up >> in the technology names we hold, we look at them and say the fundamentals they're going through at the moment will persist regardless of what happens with the pandemic. in the meantime, the valuations in the high 20s, low 30s, put the basis at a premium to the s&p 500 for sure, but they don't trade in multiples in the s&p 500 like others do i would use amazon and netflix as examples of that. amazon trades at almost five times the multiple >> speaking of the names you do feel comfortable holding in big tech as you said, i believe it's microsoft, facebook and alphabet we have a big hearing tomorrow

there will be a lot of regulatory pressure on these companies going forward. for example, if there is pressure on facebook to spin off instagram. do you think there is a way in which you could end up owning all pieces of these broken up companies and still do fine? >> i think there is a wait and see attitude you need to take with regard to that. i think the fact having all the ceos simultaneously, each of those companies have a different dynamic in the operating environment. to bring them all in simultaneously to me is the wrong way to go about it, you should take each one on their own and categorize the specific situation with the competitive situation, but i think it's the beginning of probably a very long period of time that this company will be in the forefront of the news. in the meantime, the fundamentals of the companies that we own are in great shape we think the long-term trends coming out of covid, for example, digital advertising space was very, very good long

term >> before we go, neil, we're about to have a discussion of what's been going on with the silver and gold prices is there anything in your mind as you watch those asset classes lift off >> not really. i look at it as an emotional trade. people are looking at how much fiscal stimulus we have, how much are we borrowing, will this have an impact on the future i don't think inflation will rise any time soon the feds are more worried about deflation than inflation right now it's an emotional trade when you get gold going from 1600 to 2,000 >> oh, yeah. big headline it certainly feels that way. gentlemen, thank you neil hennessey and dave smith, we very much appreciate it today. investors are still chasing gold and silver. look at gold, as neal just mentioned, hit another record. went above $2,000 an ounce we're pulling back to about 1942

today. silver also taking a breather, but platinum not so much what's the next stop for gold after this what neil cold emotional higher we have jeff feingold. he's a cnbc contributor. we need to have the inflation discussion there are plenty of people out there saying you need to own this because inflation is coming that's fine, but it doesn't explain why bond yields are going the opposite way and falling to record lows >> it's fascinating, kelly it's a bit of a delayed reaction the u.s. dollar traded at 93, and remember the u.s. dollar was above 103 in march in the carnage of the equity market more importantly, the shorts are on the run look at the volume, look at the futures. typically in the month of june when we saw gold moving around a little bit, we saw them in the front month future today we're seeing 16,000 front

month features, so it's three times the typical volume you are seeing people cover shorts, but more importantly, i think people realize when you look at the month of march, what asset class? it wasn't small caps, it wasn't hard caps, it was precious metals so i think people are trying to get a big allocation moving forward, and that's why i think the move to gold signals that people are still anxious and concerned as we come out of this covid-19 economy >> so you say $3,000 an ounce is possible we have analysts on our website saying $300 an ounce is possible anything is possible, right? but at what point is this just becoming a mania as opposed to something grounded in reality? again, we look back at the last time gold prices were at these levels in 2013 there was no inflation on the horizon then >> kelly, i don't think there is any inflation on the horizon right now. the feds want us to talk about inflation, but there is no inflation. the fed is in their meeting this

week, but what did they articulate last time they articulated the fact they are not even thinking about raising interest rates until 2022 we have to put that way on the horizon. but what is interesting is the technical component. you look at silver in precious metals, it seems like there is a lot of room to run, maybe up to 30 but i see $2500 on the gold target that's only 28% higher here, and as we know we saw the last couple months that volatility in that increase in volume can move markets higher there is a finite supply of gold, make no mistake about that but analysts look to get 2%, 3% of gold, it goes into the futures market so gold and silver are both moving higher as long as we don't see any retaliatory markets from central bankers because nobody is really happy that the u.s. dollar is higher outside the united states. >> i think that's a great, great

point and what happens with the dollar will get a lot of attention, like you said, from other nations who are not pleased about it thank you, jeff, we'll talk to you soon >> you bet, kelly. >> jeff kilburg. let's head out to rick santelli rick >> another record, i'm not sure if it's a good one, but the size of this auction is 44 billion. it's a seven-year. the year of reduction .66. it was actually a very competitive auction. best of breed. it got a b-minus it was the best of auctions an all the metrics were pretty solid. the bid to cover was on the weak side but direct and indirect bidding was on the wesupply sid. we're done with the supply side, and when it comes to gold, takes some of the competition away one of the subjects is yield control. if there was ever a big reason

to start hoarding precious metals, that might be it kelly, back to you >> that's exactly the argument that one of these analysts is making with his 3500 target. rick, thank you very much. tomorrow is going to be a big day. not only are we getting the fed decision, we have the ceos of the four biggest tech companies all testifying in an antitrust hearing tomorrow before congress it's the first time bezos has ever testified in this capacity. deirdre bosa is with us. deirdre, i'm looking forward to this >> with those stats, much will be scripted. tech will go beyond those scripted answers and dig into the size and power that these companies have accumulated the virtual format, and the fact

they're all appearing together but have very different business models skpiand issues will be tricky zuckerberg should expect a grilling on his practices. chi will face questions over how google does search results for tim cook, they will focus on the actual structure jeff bezos, his first appearance in front of congress, he will have to answer to his own private label products the big question that has been debated ever since the hearing was announced, will tomorrow simply be performance theater or a reshaping of the digital market, kelly? back to you. >> i'm glad you put your finger on that very point, and we always look to see how the executives will handle it and do they say anything that opens them up to public criticism that leads to regulation.

but do you think the questioners have in mind a specific plan already to get what they're trying to get at, or is this more exploratory >> i think you have a range. you have some that want to break out big tack, there is some that want to regulate but to the point there won't be real change, i think a lot of that will come out tomorrow. however, you look back to bank regulation, the breakup of big tobacco, and you can see there could be some very, very important implications to come out of this, even if the ceos don't slip up, they don't give up too much. i think even for us viewers and consumers watching, the multitasking together will have important implications and show how big and powerful they've become >> we'll see if it changes anything in that regard. pfizer raised the dow on

earnings and announce a potential trial covid vaccine. we'll talk about that with the ceo next plus the average age of cars is at an all-time high and that's good news for a number of stocks we've got the names and we'll tell you why "the exchange" is back after this

. welcome back shares of pfizer climbing after reporting better than expected earnings and not just giving guidance but raising it today. the trial of their covid vaccine is also raising this week. let's bring in meg tirrell and a very special guest for us. hi, meg. >> pfizer becoming the first one to finish the second phase they're rolling out the next trial and it includes 120 sites globally if all goes well, they should face regulatory review by october. we have ceo albert bourla. albert, thank you for being with us i want to start with the timeline because the timeline

you put out there is faster than anybody else in the field right now. just walk us through, if you could, how you get to applying for approval as soon as october, or as you guys said in the call this morning, perhaps even by september if the first participants were just dosed yesterday and they have to get another shot in three weeks. that means you're only following them for about a month, right, before you apply for approval? just help us understand. >> they go, megan. what a great day it was yesterday because a lot of companies will be able to have efforts to bring a vaccine because it's much needed our estimations are real of course, it's difficult to execute, but we have very, very long experience in executing these long starters. we will have good execution to be able to initiate these results. we will deliver up to 120 sites, as you said, and we expect that we will vaccinate by august

already the vast majority of the 30,000 patients. we have a position of sites in areas that have severe cases then we have the cdc with the disease on the specific sites. people will come with diseases we believe with normal efficacy over the vaccine, we will have results to demonstrate a significant difference by the end of september, beginning of october. the more vaccinations could come earlier. >> help us understand what marker pfizer is looking for in terms of the efficacy and seeing that this vaccine works that would give you confidence in filing for that regulatory approval is it the fda's guidance of reducing infections by at least

half >> absolutely. we are following all the guidelines of the fda, and we have a series of primary and secondary points but the two primary points is to see if we reduced the disease, and we will measure the disease not only by clinical examination but also by laboratory tests like are performed in hospitals with each of the patients with the disease. and the secondary point will be the first primary point for people who never have the disease, and we will see if we can block the occurrence of the disease in this population there are multiple other secondary importance >> as people are watching these timelines that are faster than we've ever seen in history, many are concerned about the speed and the ability to ensure safety what guarantees can you give that in that amount of time, you know that this vaccine is safe

>> look, we are going to cut zero corners the fda has set very high the bar. as long as we all follow the fda bar and we all are subject to approval by the staff of the fda, and they know very well the situations, and of course other countries, i think we can all feel comfortable that we have a vaccine that is safe and effective. >> it's kelly here back in the studio, albert, and again, thank you very, very much for joining us one other question on this timeline of course, the whole world is following is very closely. i know you guys said you're t t targeting in october approval of this vaccine, but if you're only starting this now, won't that push you past the end of the year >> yes, but keep in mind we have

started beginning of may, and we're monitoring those patients, and we are having follow-up with those patients, and we will continue following our patients for safety to see how it will be for two years. if the fda can make up their mind about providing approval, then ours will be accepted the same is with other regulatory places around the world. >> absolutely, because not everybody is counting on this. so are you confident that we could have a covid vaccine for public availability here in the u.s. by the turn of the year i mean, are we talking january, feasibly, do you think sooner how quickly can this be brought to market? >> there are things that we control and things that we don't control. and the thing that we don't control is the result of the study. i don't know if the study would

be effective all of the clinical results we have so far makes me cautiously optimistic it's a very strong phase b, data set that gives you confidence that your phase c will be successful, but you don't know until the end of this phase. what i can control is if i can have product available by that time right now our manufacturing sites all over the world are working very intensively and are going to produce product at risk so if the vaccine proves to be safe and effective in the october readout of this phase 3 trial, we will have product in october, november and december fewer doses in october, many more in november, many more in december and then we are ramping up all the way to 1.3 billion doses in 2021 and up to a hundred million doses this year. >> one more question what is your message to people who are reluctant to take this vaccine because of how quickly it's been developed, and how

much of the public needs it for us to get kind of general herd protection, so to speak? >> i understand their concerns, and i understand their concerns because there is a lot of political discussion and there is a lot of discussion that political reasons would drive the approval of vaccines or not. i want to assure people that will not be the case pfizer, to start with, we are 170 years of company we will never submit something we don't feel comfortable but is safe and effective the fda knows the integrity of this organization, and i think they will do their job to those people, i say i understand those concerns, but they also need to understand that their reluctance is not only affecting their health, it's affecting the health of others it could keep the transmission going, and that's unfortunate. >> albert, it's meg again. you were just talking about politics, and of course, this week the president, or on friday

the president signed four executive orders on drug pricing. in that announcement he said he had invited executives from the pharmaceutical industry to the white house to discuss pricing there was then a report from "politico" that the drug industry and industry groups refused to send any executives as it would disrupt your work on covid-19 did you decline the president's invitation, and what's your take on those executive orders right now? >> no, i didn't decline any invitation and i didn't receive any official invitation to go to the white house. but i have to say, i was disappointed i think that this was not the time and this wese were very raa positions of the administration. right now our scientists, our manufacturing workers are working tirelessly to find the solution and manufacturer solution for covid-19. i want them to worry only about one enemy, which is the virus.

and to bring now something that will make them worry about their jobs, i think it doesn't make sense right now. >> well, i want to ask you about that, too. the industry is doing unprecedented work right now at unprecedented speeds on a vaccine and on therapeutics for covid-19 and i know that you see this as a potential opportunity to win back the public's respect. cnbc and change research have been tracking the industry's approval rating over the last few months and new data actually shows approval for pharma is now down to 9% so as you're doing this work that we've never seen before and people are depending on the industry to really save us from this pandemic, what is the industry doing wrong to still be so distrusted by the public? >> i will tell you, meg. reputation is lost in buckets, but you can earn it back in drums. unfortunately, this is how it goes

i think although with the administration through our work on this pandemic, for society we have to keep doing it. i don't think we can declare victory just by resolving the covid-19 crisis. i think we should do that and keep bringing the new phase of this science-based patient-centric industry >> thank you, albert, for being with us, and we hope you'll keep us posted as this trial goes at lightning speed. >> i keep my fingers crossed, meg. >> we all do >> we do, too. kelly, back to you >> thank you to albert bourla coming on and giving us such a candid discussion. we hope to have him back soon as we are all very, very hopeful that this vaccine is efficable -- is that the word -- and widely available as soon as possible let's go to sue herera >> here's what's happening at this hour. in san francisco, roughly 150

firefighters are battling a five-alarm fire that had engulfed several buildings in a warehouse district sending clouds of smoke all over the city gun manufacturer remington has filed for chapter 11 bankruptcy protection for the second time in just over two years. the filing comes just days after the collapse of talks between the company and the navajo nation, which reportedly was considering purchasing remington's assets the perseverance, the mars rover, on top of an atlas 5 rocket moved to a cape canavaral launch pad today, bringing it one step closer to thursday's planned launch the perseverance will collect samples and store them for a future rover to take back home to earth and football star patrick mahomes is now one of the owners of baseball's kansas city royals the 24-year-old chiefs quarterback recently signed a massive 10-year extension that could pay him as much as $5

million tied to the biggest deal in sports history. now we know how he spends his money. >> you get paid a lot of then and then you put it back -- you know >> he played baseball a lot of years going through college and his dad was it baseball for 11 years, so it's very close to his heart. >> these superstars pick it up very late. lebron wasn't playing when he was young. >> exactly virgin galactic revealing the cabin interior of its spaceship 2 vehicle today. space enthusiasts are now able to explore in augmented reality. we sat down with the space officer and here's what they had to say about the designs >> i had a chance to peek up into our spaceship and see the reviews of the cabin we're going to unveil. people are going to be blown away it is done with such meticulous

detail thinking about the experience they're going to have >> george, as michael just mentioned, you have been working on this for quite some time. why unveil the interiors now >> really, morgan, this is sort of the exciting final stretch of stuff. right now we're in the spaceport, and as you know, we've debuted the first and second level of the spaceport. we've actually debuted the third level which we'll unveil this year, and i think the world will be blown away. >> is the expectation that as you unveil more details about the expectations of the ride, george, you'll see more reservations online due to it? >> i hope so we have had good feedback on our so-called small step reservation plan obviously we haven't reopened ticket sales yet, but we have enabled people to sort of put down a little bit of money to tell us they would like to go and buy a ticket when we do

that and we've seen good growth in that, and i think we expect to see that each time we do one of these nice events, we get a nice tick-up in those metrics >> and of course virgin galactic one of the most popular stocks in the past three to six months. it's up over 120% in 2020, down just fractionally today. coming up, returning chickens hotels to clubs. the beefed up unemployment ceive ts, does it really inntizpeople to go back to work we'll debate stay with us

welcome back get your loose change. let's catch you up on a few stories that should be on your radar today. it is time for "rapid fire." here with their takes on dominic chu, seema mody and kate rogers. good morning, one and all. sherwin williams putting a good picture in their second earnings report they saw professional demand for diy paint products they even gave a forecast, guys. they think 2020 will be about the same as 2019 dom, not a lot of people can say that shares are up by 61% >> this is a trend that has been in place ever since the covid-19 pandemic began we've talked about zoom video, peloton, netflix, but a lot of folks out there who have tried to use the time to make improvements in their home have been doing so at home depot become the beneficiary it's not just sherwin williams doing good here.

look at baer selling paint at home depot ma many products are getting a lot more demand, so if you're able to purchase some of these things and spend the resources, this will be a trend that stays in place especially if people with financial means -- and that's important -- with financial means continue to spend more time at home and develop more resources towards improving. >> this is a real question, seema and robert, for your thoughts when does this trend end you can say i did all the home improvements in 2020 and i don't want to see another can of paint for 10 years >> more people are staying home and trying to expand that experience by upgrading their tv and many are saying, i don't want a white wall, i want to paint it maybe when many feel they can go outside, they will question whether those purchases make

sense. >> home improvement is never done there is always something that can be done or better or someone in your house wants done >> that's what the investors are hoping i just don't know if it's sustainable. up next, if you feel like you're seeing a lot of clunkers on the highway, you're not alone. 25% of cars are at least 16 years old, but in my family that was pretty new let's bring in phil lebeau for more >> what we've been seeing for a number of years, the vehicles on the road continue to get older and older, and the latest data show the average age of vehicles on the road in the united states, 11.9 years that is an all-time high even more surprising, one out of every four vehicles out there in the united states is at least 16 years old, and covid-19 is actually going to accelerate this trend because people are driving less, putting fewer miles on their vehicle and then they're going to say, i'll keep it longer.

this is good news for a couple stocks in particular, autozone and o'reilly automotive. these stocks -- general motors, there's nothing happening for these stocks even though they're trying to make themselves into a growth story don't forget, kelly, tomorrow morning we'll be talking to eo of general motors. you do not want to miss that conversation we'll talk about her outlook for the rest of the year >> it's interesting, robert, because i thought we were going to be a post-car society yes, we're driving less but the trend toward car ownership and the length of time a car can be on the road now, it just keeps going up >> kelly, i grew up like you my first car was a 1972 volvo and that was really old, even back then.

but i have a question. the age of the cars is going up, but i wonder if because we're driving less whether the miles on the actual cars really hasn't gone up that much. >> it must, right, phil? >> a little bit. they're not going up as much as usual. we're putting fewer miles on the vehicles this year so the percentage of miles that we usually see or the number of miles we usually see, which depending on the person, is usually 12 to 16,000 it's probably going to be closer to nine or ten thousand this year >> and the great thing, phil, the older they become, they become collectibles and they become worth more. >> i don't think my gre nanada collectible. >> thank you, phil lebeau. the pandemic has turned the travel industry upside down. there is a hotel trying to get out of the hotel business in

favor of private clubs marriott, hyatt and hilton still down 30% tell us what andrew belage is up to >> he owns the mercer in new york city, he owns a big hotel in london, and his rival here is the soho club, which had huge success. they actually just raised $100 million during the pandemic to get a $2 billion valuation, and that's a club motto where they have rooms, they have pools, restaurants, bars, places where you can meet up. but the problem is there are a lot of these clubs already, something like 1,000 in the u.s. just with a million or more in revenues, and these clubs haven't done well during the pandemic you look at soho house which just raised a lot of money, they had to get ppp funding because they really couldn't charge dues so i don't know if this is a pandemic-proof model, and there is also a lot of competition >> what do you think, seema, about these hotel stocks

some of them, like choice hotels, they tried -- we talked to the ceo about this -- they tried to stay open, people taking their kids to college, they have to figure out someplace to stay overnight, but a really, really tough business. >> it shows the pressure building on these hotel operators, so think about how they use the underlying real estate on these properties with occupancy right now around 45% across the u.s., well below the average of 75%, which is not expected to come back until 2022 my question is whether that concept will actually work in this new world perhaps it shows how hollywood celebrities are thinking about ways to maintain their privacy, but are they having testing at the door, what type of screening will be involved i'm not sure >> let's go from highbrow -- i

would consider chick-fil-a highbrow, frankly. some of them are offering free food in exchange for their customer's change. to me this is the story of the week, the month. the most recent chick-fil-a which is offering free food in exchange for your coins because they need coinage so badly are in lynchburg, virginia they're telling them what change they bring in, they'll get a free meal and a $10 bill for a chick-fil-a sandwich >> this is one of the best stories i've seen in such a long time, because it's one of the effects of the covid pandemic we're not talking about, in that people are using more money to go out and buy stuff, if they are even spending at all one of the biggest things i found, i went to a bank recently and even the banks are kind of rationing out how much thachange they give out. they give out one roll per customer per visit there is a beneficiary of all this, and that is charitable organizations. the reason i say that is many

retailers are now asking people to round up their purchases, and whatever that change is goes to a designated charity if you are looking for creative ways about how people are trying not to give out change, one of them says, hey, if you have a bill for $21.50, just consider donating 50 cents to this particular charity, we'll round it up and pay them out, so hopefully there is a silver lining in this, kelly. >> that is super interesting, because seema, often they ask me to round up, but i'm using apple pay or whatever. there is no coinage to that. >> and i think this shifted during the pandemic. i know for one i'm using more credit cards on purpose because i don't want to carry coin, having to fall on the floor and having to pick it up and mistakenly touch the person i'm tr transacting with i think it's interesting that some are saying, hey, bring your coins to me. >> robert, the last fed meeting, or maybe it was the hearing on

capitol hill -- >> when powell was talking about free chicken sandwiches? i love that part >> he didn't quite get to that part, but here chick-fil-a is offering free food to get coins? that's pretty bad. >> setting aside the free sandwich which is unbelievable, before, when you went to a bank to put all your change in that giant machine that then gave you money, you would pay at least 10% and the bank would give you $10 in change, they would give you that minus 10%, so now you're actually getting the $10 that you put in the machine. so that's just amazing and a chicken! >> we talked to the ce o of coi base and asked him if he would waive those fees he didn't really take, but they might have to. that's why i say, round up your loose change muni bonds are having unemployment for the first time in 15 months

but with spreading covid, should investments stay away from the muni market? as we head to break, take a lco at the casinos. meis up nearly 5%. we're back in two.

welcome back we've seen some surprisingly big moves in muni bonds. investors have been purchasing these bonds with a start of about $1500. congress is struggling to agree on any covid relief for governments, and whether they do or not would seem to have huge implications for the muni market here to talk about why investors are not more deterred is tom it's good to have you back there are not a lot of headlines in the stimulus bill about state and local governments, so people

are piling into munis, anyway. >> i think the heroes act and the comparison to the heroes act is important to look at, but as you were mentioning, there has been a significant amount of flows in muni funds over the last couple weeks. we saw -- just last week we finally went net positive for the year there was a significant amount of flows out of muni funds back in march, but as you mentioned, that ramp-up over the last couple weeks has really helped >> why is it is it just that the yield is too attractive to ignore in this rate environment do they just think, hey, there is no way they're actually going to stop paying their bills because the federal government will come in and do something? >> i think part of it is the value of the tax exemption i think part of it is also the fact that there are a lot of municipal entities across all sectors, state and local governments, airports that had very good fiscal positions going into this.

>> yeah, which helps, of course. it gives you a little more to draw upon. let's talk about some of those places you mentioned airports, but another one, hot button issue, let's talk about toll roads, what kind of status they're in, whether we should expect more and more toll roads as places look to raise revenue. >> i think when you're looking at the revenue sector like airports and toll roads specifically, i think you really need to get into the situation that the end result creditor is dealing with there are people driving less as you talked about in your previous segment, but one of the things also happening is there is a rise in commercial activity in some areas. while that commercial activity mint might not be exactly where it was a year ago this month, that commercial activity has helped sustain those also >> i know you think there are some places where people can look for munis that have been less impacted by covid

i'm surprised water and activity would be one of them >> there is room to talk about potential aid for state and local governments, but the things we have sewer and state as well as local housing financial agencies those are sectors that had been and we expect to be less affected by what's happening with covid that being said, that only included about 100 billion for school districts and did not include anything for states. i think that's going to be important going forward for the sector >> you'd like the see that i crease for people to breathe easy easy >> absolutely. some kind of meaningful aid will be around the 500 billion mark we'll have to see,0 how things, there's a deadline of next

friday we'll have to see how that shapes out >> tom, thanks very much we appreciate it >> thanks very much. still ahead, it's aen ongoing battle are enhanced unemployment benefits keeping people from going back to work tomorrow don't miss boeing ceo in an exclus ifr interview the exchges ckn o.an iba itw

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welcome back to the exchange senate republicans unveiling

their new proposed relief bill that tackles a 600 per week unemployment benefit that expires friday it extends the program to september but cuts the benefit to about $200 a week my next guest testified saying i would be a mistake for the government to continue supplementing unemployment benefits this way. with us is stephen davis he's a professor of economics and adviser to the congressional budget office. it's good to have you back welcome. >> it's great to be back >> there's been a piling up of studies contrary to your findings yale says workers facing larger unemployment expansions appear to be quicker to return to work, not slower another study found the generosity has held back job finding. to me, the problem is it suggests it's political. people are just going to come to

the conclusions they want to come to. >> that's probably true. economist studies are in service of whatever the politicians want to do any way. >> tell me why you think and what your findings say pointing to their being a real disincentive for people to return to work would you say that's true if it's $200 an not $600? >> yeah. the disincentives are less i want to make a comment about the study. before i do that, i want to apply a bit of common sense. even economists are allowed to use common sense i imagine my 10-year-old self approaching my parents and saying, why don't you try to pay me $200 a buck a week to not clean my bedroom we don't have any studies. maybe you might be surprised maybe you find i clean my bedroom. i think after chuckling, my parents would have told me nice try. we don't really need a study to

understand that there's a disincentive effect in play. if i could go to the yale study, which i think is interesting it's very important to understand its limitations as a study about the recall of temporarily laid off workers and those workers when they are recalled are legally obligated to go back to their job or lose the unemployment benefits that they would otherwise be entitled to not just the 600 bucks but the whole thing. that's very different than the situation facing a person who is permanently lost their job and thinking about how hard do i want to search for another job do i want to take one that i know might be available and doesn't speak to the incentury ti -- incentives rr challenges facing employers who in creating new jobs, not recalling old jobs but in creating new jobs need to compete against the level of unemployment benefits. those latter two things given

with permanent job loss, providing employers incentive to create new job losses, those will be increasingly important relative to recalls of temporary layoffs as we go forward in the coming months. >> we only have a couple of seconds left it seems if you abruptly stop this payment, there would be bad economic disruption as a result of that, no >> i do favor income relief programs there's many ways to provide income relief that doesn't destroy the financial returns to work i think that's what we ought to be focused on. i do not think the $600 unemployment benefit supplement does a very good job of targeting those families that are most in deed >> we talked about incentives to go back to work. stephen davis, thank you for joining us we appreciate it >> thank you that does it for us today.

next hour, it's tilman tuesday he weighs in on why he thinks ending the 600 dollar unemployment benefit would be a huge mistake stay tuned how does the world reopen for business? to return to the workplace, safely, companies will need the right tools. that's why salesforce created work.com it's an all-new suite of apps, expertise, and services.

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hi, everybody. welcome to "power lunch. as we hurdle toward friday's stimulus deadline, a look to the economy if a deal doesn't get done a new letter emerges to describe the recovery plus, it's tilman tuesday. if you watch this network hoping your stocks can go up so