>> my pleasure folks, let's get a final check of the markets as we've been telling you the market has been up all morning long dow futures up 327 points s&p, but by 16. the one laggard has the nasdaq, down by 54 wilf, brian, thank you for being here today >> pleasure as always. >> okay. wilf, we'll see you later today. brian, tomorrow morning. folks join us back here tomorrow morning. right now it's time for "squawk on the street. ♪ good morning, and welcome to "squawk on the street. i'm david faber with jim cramer. carl has the morning off let's get a look at futures as we get started with trading a half hour from now as we've seen just heard from the gang on "squawk," we're looking up, we're looking up, a lot. potentially at least, not from the nasdaq, though but all -- or a lot of this, a result of, jim, a response to a

russian vaccine. >> yeah. >> which i guess is, i don't know -- i don't know are you going to take a russian vaccine? >> that's about -- now, we're really talking about a tremendous leap of faith a russian vaccine which i think they've dubbed did chernobyl ii. i'm going to pass. >> is that a hard pass >> yeah, hard pass chernobyl >> it's been approved even though it's had trials. >> easy come, easy go. remember, they spent a fortune on the trial and a couple people died i don't think that's the russian way. nor do i think when 28 people died in world war ii did necessarily everybody come to a fight with a machine gun fight and they have very little fear and it's demonstrated in certain

trials, really >> well, listen, we can hope there's great science there and there is something >> well, they used to have great science. >> and plenty of scientists, no doubt. >> and rockets they stole a hydrogen bomb from the rosenbergs, they can do that. >> let's read what putin had to say, as far as i know a vaccine against a new coronavirus has been registered for the first time in the world. although i know it works quite effectively it forms a stable immunity and i repeat it passed all of the necessary checks. there's a man you want to listen to and believe >> right >> but the market seems to be believing it to a certain extent >> well, the market wants to believe. and the market wants to believe when the airlines are showing better numbers, you should agree with that. and the market believes that royal caribbean with full bookings for next year, well, you want to believe in the cruise lines and the market wants to believe

that jamie dimon comes on "today" show and you buy stocks. those who don't believe, david, are in the nasdaq, and they will get hurt >> right to your point, we're seeing gold coming off highs we're seeing the ten-year yield above 6 again. i know it sounds funny to say look at that move. and corporate credit is so cheap. there was a junk deal at 2.85, you can imagine, 3%. >> and on tonight, the largest shopping center, they got a really good rate even in the middle of a pandemic carnival got 11% and last year, they got 1% they're obviously not doing as well but i have to tell you, david, that there is a belief that unemployment not only hasn't peaked, but it's down radically. you can kind of see the numbers. and the numbers -- they're -- there are 24 million in april. now they're down to 16.4

million. now, that's still a huge number of people. >> oh, my god, come on we've got a lot of people going to food kitchens >> no, i just meant the trajectory -- let me back up.the stock market is not acknowledging the food kitchens. >> no. >> and i was talking to secretary steven mnuchin how do you feel about the disconnect between the soup kitchens and the stock market but how have the stock markets really represented america >> well there was a sense, for a period of time, that it did. that it was broadly reflective of prosperity or lack thereof. i just don't feel that's true anymore. >> no, i don't >> and we've pointed out the reasons why it's so heavily weighted towards what is really just five companies. >> right but don't you also think that when jay powell said basically, we're not going to allow bankruptcies, that was a very seminal moment >> uh-huh. >> when boeing, which we're going to talk about today was able to raise the money?

that was the bottom? >> yes >> and what you really had, we have hedge fund managers that hate it when you mention they were negative. they call you and try to say, hey, listen, i really didn't see that but cnbc creates its own bottom. and ever since then, it's been nothing but net. >> it's been amazing, as we see here, these intra-day levels, on february 9th and where we are now. it is stunning and i'm sure, jim, more than i do and i get it a lot from people which is how can this be? >> right >> i don't understand how is it that the stock market is at the levels it's at, giving the suffering that's going on in this country and to your point, thankfully, unemployment may be coming down, but it's still at levels we haven't seen in our lifetimes. and at the same time, there seems to be hope about further tax cuts, even though, again, back to our interview with secretary mnuchin yesterday there doesn't appear to be a lot of progress made in the last 24 hours in terms of talks between

house, democrats and senate democrats and the white house and republicans. except now that the president wants to cut capital gains taxes. >> for four years i worked with larry kudlow he stood for cutting payroll tax and he always thought that federal gains taxes were too high i don't think there's any mystery what is happening. i believe the president is listening closely to his economic adviser and putting that program through that larry had when we can doing "ludlow & crammer. which i still have the t-shirt and why don't they respect larry, people know that the capital gains tend to be -- i'd say, for the wealthy >> yeah. >> are you kidding me, he didn't want to work with larry. the idea was the wealthy get anti-gains they'll do more with it.

it will trickle down, and then cascade down, david. >> didn't we have a corporate tax cut that was supposed to do the same listen, may have had an impact, also impact on the budget deficit at least to date second mnuchin has been saying all along it would have paid for itself eventually. i don't know, jim, payroll taxes do not seem to be the area to be focused on when you've got 10% employment >> right because the payroll tax affects the people who have a job. and the capital gains are great for guys like me >> right >> and you're just dissing the whole view of the president? >> yes >> but -- >> yes >> but reach people have feelings too, david. >> i know, we cry. and we get out our tiny violins all the time >> that's when i love lenin, you know, it's a distance relationship, but if they return happy, it's their own fault. you're more of a trotzsky.

>> that's true i really like mexico city. and a really nice place. >> let's move on with the show >> yeah, we can move on in the show we shall do that back to the markets itself, jim. and you know, we are going to potentially hit new highs today. >> right >>f fuif i had told you that, et cetera say april 1st not april fools' day, march 29th, would you think that was possible? >> no absolutely not particularly with the unemployment and the numbers for the airlines the numbers for transport, terrible numbers for oil, terrible. numbers for housing very good. k.b. holmes pushmes pushed today the work from home created a gigantic expansion of tech that might retreat a little bit. the restaurant business is moribund

the movie theater business is moribu moribund but somehow, people want to overlook that and buy. we know there's not a lot of alternatives, david. what else do you do with your money? put it in a chimney? >> yeah. >> what are you going to do? >> even marcus high yield savings. >> i've got money in that thing. >> have you gotten emails, we're lowering it, we're lowering it >> i get netflix, what are you doing tonight, jim and the markets? i'll take 0.7 if they stop selling me emails. >> i know. >> david, it really is, and i'm not being facetious. there say belief first of all we have the nas danger and the big five. that's going to go down because there's not enough money for both of them then the industrials we have energy north of 40 which does mean that a lot of the companies, with the possible exception of occidental can live to play again. so that is something that is

substantive. but for the most part it was the fear trade and the work@ho-at-he trade and that's going away. it's going to be replaced with caterpillar and chevron. look at microsoft. >> that was interesting, the gold mining company accelerated. >> was that the peak yesterday when we had dr. mark bristol on, is that how it works oh, cnbc -- why don't we go to meg tirrell, david >> yeah, let's get to meg for more on russia's claims for having a covid vaccine meg, fill us in. >> hi, david, we should make really clear that russia has said it's approved this vaccine, not because it's broad tell through broad-scale testing to ensure that it is actually protective against the coronavirus and that it's broadly safe, but because they decided to approve it after only

initial small trials in a few dozen people and after animal studies to make the comparison, we are that far along with multiple vaccines here in the united states with companies like moderna and pfizer and the uk with astrazeneca and auctioxd and russia does plan a long-term trial but we don't know the safety of the vaccine. i was talked to paul offit saying there is no way them should have evidence that this vaccine works to this point. it's two other viruses called adeno-viruses used to ferry the genetic material these are programs used with

johnson & johnson. know companies are combining and this is different in that way. russia claims they have developed this for other diseases, but, guys, we haven't seen the data. so there's a lot of skepticism about this claim russia saying it has won the vaccine race it's only based on the fact that they've decided that the race is shorter than other countries have expected. we and other countries around the world are running massive phase three trials in tens of thousands of patients to ensure that the vaccines protect against the coronavirus and are broadly safe every the concerns here, even if you determine safety and the fact that these vaccines do generate antibodies, we don't know the level of antibodies and t-cell response needed to be protective and we also don't know in limited trials if there could be safety effects that just haven't been seen yet, guys. so many concerns about this, we have to put it in perspective. russia is not far along.

they just decided to go with less data. >> that's great reporting, meg very helpful if we had to equate it in terms of trials, feels like they're in phase one, not phase two they're trying to figure out safety, and yet, they've approved it? >> yeah, i mean, they haven't even published any of the data either so if this were happening in the united states with a company, they would be getting so criticized for making claims that this vaccine works. without showing the data, and ensuring that it does. you know, putin was quoted this morning saying it's effective enough and that it generates an immune response. but how is anyone to know that and so the fact that they are starting, they say, to vaccinate teachers and health care workers and then broader population vaccination this fall is very concerning to people >> well, meg, i mean, this is not -- you know, a dog into space versus nothing for us.

i'm confused have they told us anything about what's in it have they indicated that it's novel? that they've done some work and it's using a particular strain of thought or is it really just like, hey, you know, lysol -- i'm sorry, i didn't mean that -- >> hydroxychloroquine. >> david, stop it! i'm talking about science. have they revealed any science >> from what i've been able to glean, you know, they do say that it is based on a platform that is similar to what other developers are working with. these two other virus call adenoviruses basically being used as vectors to ferry the information from the coronavirus to the body. and basically exposing that genetic information to get the body's immune system to generate antibodies and t-cells >> is that rna is it a moderna? >> no, no, it's not.

>> is it a putin cell -- >> so, the problem, jim, is that we don't have any data on how well this has worked so far. and it's not a platform that is unheard of, but no other companies have presented data combining these two vectors, so we just don't know very much about it >> meg, thank you for putting -- making it very clear >> really, really clear. >> yeah, that there's not a lot behind this. at least at this point we can always hope, jim, to the point you've made in meg's reporting which has been so great throughout this, we are moving our companies and/or other global pharmaceutical companies are moving quickly with phase three, getting manufacturing ready. by the way, my subject that i always talk about and the antivirals moved towards phase three. >> it's hard to get 30,000

people together. and half of them get something that doesn't help. and then they go to a brooklyn rave >> really? >> we had a brooklyn rave in new york yesterday >> thankfully, it remaining low in brooklyn and manhattan. things are low here, there might be a chance that school can open with kids actually and teachers in the same classroom. when we come back, much more to get to this morning we're going to have apple's march towards, yep, $2 trillion. by the way that makes tim cook a billionaire. we're going to take a quick commercial break stay with us and a highly connected lexus vehicle at the golden opportunity sales event, lease the 2020 es 350 for $359 a month for 36 months. experience amazing at your lexus dealer. a lot goes through your mind. with fidelity wealth management, your dedicated adviser can give you straightforward advice and tailored recommendations. that's the clarity you get with fidelity wealth management.

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a new milestone for apple ceo tim cook his network has eclipsed $1 billion. that's at least according to the bloomberg billionaire's index. you can probably take the stock and multiply it by the stock price. it has put the apple company within striking distance of $2 trillion who knows he could hit it today. 467 had the 2 467.67 there has been a good amount of attention frommr. cook in his management of this company, because now it's been a long period of time there were certainly plenty of doubters having taken over from the icon that he did but he's become one of his own >> i mean, look, the company is

the most loved company for customer service i've ever seen. when something comes out, it turns out you that need it you didn't know you needed whether it be buds that you can press and suppress noise while on a plane, and whether it be a series of apps that they come up so you feel terrific on my phone. where we can press something or talk to siri right now and say, david, could you please shut up. oh, geez -- i'm sorry, david, it likes you. but it's just an amazing company. and he deserves it i mean, the guy -- of the ceos who have gotten it to where they are. i think he deserves it more than anyone, microsoft, jeff bezos. it's interesting when an employee, and that's what he is has become a founder >> there are a number of them.

>> blackstone's got a couple of its own. >> true. >> les moonves was probably pretty close >> geez, you had to go there >> yeah, just trying to think in my own mind, of those people who became close, almost, being employees. just being paid with restricted stock, or with options and with enormous amounts of compensation >> i've always felt if they created it for you, they're certainly deserving. it's people who don't deserve it but, you know what, david, it's very interesting that sandra bernstein has come up with a piece that says we keep irritating china 15% of their revenues could be -- obviously, apple's best times are behind it. >> yeah, another piece out we do bring up apple all the time about the tensions with china for valid reasons. probably going to discuss an apple, tesla, could be

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the s&p 500 enters today's trade up 4% for the year it has now within striking distance of a record and there are some of the larger gainers that we're looking at for this morning we're going to take a quick commercial break we'll get jim's "mad dash" on the other side

all right. let's get to "the mad dash." simon property reporting earnings, jim, on your radar >> yeah, i think the numbers are okay considering the fact that 30 million people are not paying their rent in this country, you have to take a hard look at what these guys are doing 73% of their tenants are paying which is up from 69% in june and 51% in april that's a very healthy sign and this is a stock that obviously has been in play, because of the possibility that amazon may take the place of some of their big defaulted giant department stores. look, i think that david simon is doing a lot of things right

in the end, it's a mall and that's going to be challenged. but he's a great executive and, david, i don't know, he was going to be a bigger executive a bigger mall collector. and that deal fell by the wayside. >> well, it didn't fall by the wayside until the court decides it has they're trying to get at what was referenced as theed tom edt deal don't forget, the toddmans were partners too it's going to be mid-september where that. >> how do you own stock? >> yeah, it's not that huge of a ticket for them. they can do it it just increasing their portfolio and their exposure here's simon on rent worries, right? he said he was feeling pretty good in june about finally getting back to work he said i feel less good in july, now, i'm totally confused.

>> that's why we need david on the show >> has he ever come on >> no. and i can only do so much, you know, i've tried so hard because he's such a great spokesperson you know what, i got someone better, david. i have don wood on tonight, from the largest shopping center ceo. he's articulate and he'll come on even though you paid $33 billion in distributions or more, don will do the speaking, not you david. >> david as in david simon i would like to hear from him as well >> oh, my gosh >> we will pay close attention when that trial begins there are many who believe if that contract is disallowed, then contracts mean nothing. but, jim, we'll see. we'll see. let's get started with the opening bell here. what's the key to this market today? >> i think the key to this market is home depot several analysts have said that the numbers are too low.

home depot, dow stock, home depot, a place if you bought a new house or refinanced, you've got the money to do something. and i think it's a spectacular company and it goes higher. >> it's a $300 billion market cap at this point. >> yeah. >> stock up 30% so far this year and is poised to be a bit higher you hear the opening bell. you take a look here at the realtime exchange. i used to say back at headquarters but we are headquarters >> we are headquarters remember, david, there's not enough money for tech to go up >> it's a lot about rhythmic trading. faux green >> faux green. >> apple's down, from our early conversation at least at this point, close to 2 trillion, but not approaching it >> how about the vaccine stocks, david, given the fact that the russians, they're splitting the

vaccine. >> i mean, if you listen to meg's reporting which i think we should all take to heart, they don't have any >> no, no. i'd rather be in union pacific or ppg. >> you would >> oh, gee, david, this location has got some gain. but ppg used raised guidance i think that the rails are going to raise guidance. i think the heyday of the stay at home, work at home trade has peaked it's peaked. >> why do you think that >> i think that because the numbers that we're getting are slightly better. and i think that there's a sense that even though people can be able to choose whether they want to work at home or not, it's kind of played out and the stocks, meanwhile, are selling between 10 and 30 times sales. and that versus very low, of the industrials and the oils even though the industrials and oils don't have a lot of momentum i think a lot of people are

starting to say how is 2021 going to be? and 2021 is going to be better than 2020. >> you've been working through the office throughout the pandemic i've been out much more than in. but it is nice to be in the office >> is it >> by the way, still going to be plenty >> why >> back and forth. in part, it's dictated by the schedule that your children have and any number of things we'll see what happens when school's open, jim that's such an important component overall of our economy at this point. i'm not just talking universities, obviously, the schools around the country the grade schools. what are we going to see i mentioned earlier in new york has a positivity rate that's extremely low. at the same time, there are plenty of teachers that don't want to show, and certainly in areas where the virus is still very, very dangerous, that would be seem to be the case i don't know how do we get our economy open if we can't get the schools fully open >> the arizona state president basically says, hey, listen.

it won't be business as usual. we're going to have masks, social distancing, but it's time for everybody to come back because the rate of the r-not has dropped dramatically there are two camps, that the case numbers are going to go you and the camp that says the deaths have dropped dramatically i want to know the camp of people who got it and whose lives have changed dramatically for a negative way they don't talk about that enough >> no. and we are, again, 22-plus percent of the world's cases you know, jamie dimon was on "today" show, jim. i want you to take a listen, he was talking about these very subjects, opening up schools, back to work and working from home. take a listen. >> the government has got to be a little bit more -- particularly for small business, unemployment, insurance, et cetera, to get us through the next three to six months as we open up. we're going to have to open up

it can be done safely and soundly. there's still 130,000 people working from home. while there may be permanency to some of that, there's a huge value to working together, in terms of creativity collaboration, and hopefully people do it safely. we're not going to do anything to gjeopardize the people. >> he's talking about his workforce, 150,000 still at home and we were talk about a seminal change to work at home which could be the case. when you're younger, you want to be around other people, you want to pick up the culture, you want to get ahead, it's hard to do that from a remote setting >> yesterday on the royal caribbean, talking that humans her social we need need each other. you can't teach zoom

zoom-teach people how to trade, how to help clients. yeah, i think it's going to be rotational back. i think when you look at the nasdaq, the nasdaq is telling the truth right now. the stocks got too high. and the industrials have to catch up but we don't have the earnings to back up the industrials >> right >> and we don't have the place to earnings multiple that's reasonable in the nasdaq that's why the could nfusion exs >> jim, by the way, jamie is one of a small group of people who is a billionaire who is not the founder. it's an amalgamation of so many banks. >> it's the nasdaq -- the nasdaq is falling apart >> the nasdaq is falling apart well, given the broader market but it doesn't seem to last long, jim. everybody seems to come back

like in a few days >> they do it usually takes three days. what are we in day three >> tomorrow's a buy? >> well, you have to look at the sorrentos and the novavaxes of the world. you have to watch disney which is a hybrid but if that starts going down, you'll start seeing money back in tech i don't think it's sustainable -- >> but it's an ugly rotation right now. >> it's a hideous rotation people at home have to recognize it's not like you own companies who are bad. you own companies whose stocks got up high. and people believe that next year is better than this year. whether it's the airlines. and the cruise, i thought it was amazing, royal caribbean yet, the cruise reservations are the same that they were typically. >> right >> at the same time, look, growth, david is right they always do come back to service now. >> and they always do come back to paypal. >> yes, they do.

with salesforce on tonight, charity on, people come back to that >> right >> so don't give up, but don't get too confident, because you're going to have to recognize this is a caterpillar market, even though caterpillar had terrible ratings and it's not an adobe market even though adobe had great market >> right right now there is a rotation of significance going on that we're seeing jim, you know, talk about lost sort of market cap, anyway, have you seen the teledocs stocks since they announced that deal >> i like the deal >> we had them on. they lost $10 million on market cap off that thing >> that was the peak, david. that was the peak. that was the day when the rotation started and vongo merges with teledoc at the time of the peak

it's not like you don't suddenly want to go to a doctor's office or you don't need direction for diabetes which is for the hypertension they were at the peak of the rotation and there's nothing wrong, except for the fact that timing is everything. >> timing is everything. jim, back to a founder who is a multibillionaire who's doing a lot better and i follow closely, mossa. >> yes, earnings there >> i did mention that the stock has done extraordinarily well. a real win for elliott, by the way, gets involved in some things, but this one has been very, very strong. take a look at softbank. by the way, he said asset sales about 95% complete we're talking about a lot of modernization. t-mobile, they obviously sold some contracts in alibaba.

and they repurpled over 1 trillion yen we've focused on the vision fund which will be struggling to some extent and did have gains there, you see that as well in terms of net gains. and also the moldings, one asset they're going to potentially monetize will it be sold? is there really a buyer that will hit the price they have in mind that's unclear what mossa did say it was originally a listed company. and need to make the best performance and closely study the best option. whether they take it back to the markets and monetize it and sell a portion of but it is worth noting how strong softbank has been that was a quick comeback in some ways that has not been, jim, certainly not as big a focus as the decline in the vision funds, all of the trouble that fund had. >> i was just -- when it was

going down, there were predictions, there are o obituaries written i would say -- when you look at it, when it bottomed, it was one of the most important stocks that bottomed because people felt it could take down more of the economy. that was false >> remember the days when we worked with a lead story god, i miss that >> newman. >> newman, yeah. stories like that about companies and valuation that was there but -- all right let's not reminisce too much let's get to bob pisani who joins us with significant rotation going on, at least today, bob >> yeah. three days now, actually, this would be the third day we get value rotation what's value value is cyclical games. bank stocks. they're energy stocks, they're material names

and take a look at the sectors, banks leading, techs are lagging. interestingly as you mentioned biotech has been weak now for a couple weeks, essentially, not doing much on top of that. mega-cap tech, yeah, another day weak this year some of them going technical weakness microsof microsoft, facebook, 6%, 7% low. and we mentioned seven days in a row, s&p is up we'll see if we can make it eight. the february 19th closing high, 33.86, see if we can push through that again, we've got this value rotation don't kid yourselves in what's really mattering since that high in february, it's technology, folks. consumer is up amazon has been huge x-out amazon, everything is flat health care, a small

contribution all of those things we get excited about, mega-cap tech is stuff that matters here. i know the last few days they've been down, your amazons, your apples, your facebooks, your microsofts, look at this, a new high this has pushed to new highs i know we're invited about the rotation three days in a row but if you look at the value stocks since the february 19th high, you take a look at industrials and banks in particular, and energy stocks, you put those up, well, folks, they're lagging. i know, they're rallying the last few days. but let's keep it in perspective, what's really moving thing is clearly tech, clearly semi duct conductors clearly software overall meantime, another rally not just in stocks, we're getting rallies in junk bonds. hyg is the largest junk bond and david mentioned junk bond rally.

ball corp., an aluminum can maker. they raise 1.3 billion in a ten-year bond. nothing unusual there. here's what's got everybody's eyebrows raised, 2.875, this is a junk bond offering just below investment grade. there are reports this is the lowest borrowing cost ever for a ten-year junk bond what's going on, david, there's essential lly no high yield in high yield this is one of the downsides of the stimulus, it's essentially ring-fenced high-yell hhigh-yiey challenges maybe had default problems in this kind of recession. and the fed stimulus are ring-fencing a lot of these weaker companies leading to confident pricing in some of these high-yield bonds david, back to you >> i'm glad you mentioned that,

bob. it's stunning to see a sub-3% ten-year for junk. spreads are not at their narrowest either between junk and treasury great point. thank you, bob speaking of fixed income, let's get to rick santelli as well for more on the broader markets. rick >> david, it's just so interesting to have this discussion on a day where we saw definitely hotter than expected producer price index up 0.6. as a matter of fact, tomorrow with cpi, maybe the big story is if you see the junk bond deals maybe they're giving you a glimpse of the last great deals. listen, whether russia vaccine works or not, we'll see if a vaccine comes out that has more history, more testing. and the markets are exciting with the russians and financial times, it's been quite a while it's not like this is a surprise to the market. why do i bring it up

because, listen with all of the qe that's being done and has been done to keep rates down, if we really had a vaccine, rates really could go up what would that do to high-yield spreads at this level? look at intra-day at 10s over 63 basis points which obviously isn't a lot compared to where we are in february. you could add 100 basis points but the point is we haven't closed above 63 basis points, next chart, since mid-july on that july 1st chart you clearly see. and it isn't only us european rates moving up look at bund yields. 3.5 highs today. we all know that gold, silver, bitcoin, big moves of late but not july 2nd look at corrections going on there's a lot of talk about the fed and inflation and the fact that we may never see it again if there's a vaccine that works in a timely fashion with all of

the liquidity in the system, i don't think it's going to take a lot of matches to make the tinderbox of fixed income to make the seller's rate of all time publicing rates up. jim, david, back to you. >> all right, jim -- sorry, rick, thank you. i was looking at you, jim. i'm looking at you for inflation. >> i was saying this morning how much i miss just standing up next to the telestrator with you. >> i know. >> these are things i like to do >> david kostin, he's a buddy of yours, too >> david is great. >> he'll be coming up at the top of the hour. we're standing by for new record highs in the s&p stay with us

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jim, shares of uber are down a little less than 3% right now. a judge saying, hey, your drivers are employees, not contractors. >> yeah. i felt that this stock would be down more. i know there would be appeals. i know you can cordon off california but the real edge has been the fact that they're contractors. and if you had to actually offer benefits it would be just such a drag as it is, the real money-maker is uber eats and lyft doesn't have that i don't know, david, didn't you think the stock would be down much more? >> it's still the most important component overall of their business although to your point, eats is quickly rising yeah, i guess you would think that in some way because it is such an important part of why they might be able

to get the profitability and whether they can or not. >> right and this stock would be -- on this rotation, fedex rotation, united parcel rotation, you might have had something going l build is coming back and that's another one of the things that's making it so the market is, should make some sense i don't know, david. there are things that are, to use what larry kudlow would say, they're green shoes of which uber is not participating. >> to your point, ppg is the stock is up over of% >> ppg makes the high-end autos, they are, wow. look at that thing they're the paint company and i do think this is for real. 30 million people, i don't know how many people are being evicted or being staved from

eviction or how many businesses are failing but we're not trading hair salons and gyms we're trading cars and the companies that make things in cars and i think that ppg is a shorted stock or a stock that nobody has, and it goes up if autos are being built again. we are in some weird moment, david, where if you get any good news, everyone just leaps on it, and that's what's going on with ppg. >> we also seem to be in an area where there's bad news, unfortunately there's plenty of as well, stocks don't react negatively >> no, we don't really care about that watch the vaccine stocks, bad news in those, right >> what's the bad news the russians have -- >> sputnik chernobyl meets sputnik. why don't you take some of that chernobyl rooftop dirt and put it in your body and see if you don't go radiated. >> great series, by the way, on hbo, worth a mention >> oh, yeah. things have really changed, they're much better.

>> in chernobyl or warner? there's been a big shakeup at warner >> has there >> yes, jason gill got rid of green bl greenblatt and o'reilly. >> greenblatt has nine lives he'll be around. coming up tomorrow, you're a small business owner as well, the cnbc small business playbook virtual summit will gather many of the top voices in the businesses, including facebook c.o.o. sheryl sandberg, providing small business owners the resources to survive in today's crisis and provide a path forward to thrive we'll ke ata quick commercial break. back after this. free access to every platform. mhm, yeah, that too. i don't want any trade minimums. yeah, i totally agree, they don't have any of those. i want to know what i'm paying upfront. yes, absolutely. do you just say yes to everything? hm. well i say no to kale.

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there it is, the leader of all the year-to-date s&p gainers nvidia, certainly a favorite of jim's. jenson wong who he also calls da vinci is what you used, yes, and pay pal, too what a separate that was a number of years back from ebay, well over $220 billion market value now. trinwi sp lot more andto adg th jim, coming up. a lot goes through your mind. how long will this last? am i prepared for this? are we prepared for this? with fidelity wealth management, your dedicated adviser can give you straightforward advice and tailored recommendations, with access to tax-smart investment strategies designed to help you keep more of what you've earned so you'll know you're doing what you can for your family and your future. that's the clarity you get with fidelity wealth management.

time for "stop trading." talked about mcdonald's yesterday. want to come back to it. >> what's incredible you can have a ceo commit fraud, lie, deceive, don't check emails and

gets away with it until now, and it means nothing to this market! because there's a rotation that says buy mcdonald's. i urge people to read the pleadings. you will conclude easterbrook was one bad guy. i feel bad about that because i liked him. you know what? look, you can't, there's no accounting for some behavior >> oftentimes you base your judgments off of the performance of the company >> the big mac, all-day prek fast was brilliant when he had pictures of women that he was, you know, ahem, not brilliant especially because they were on the company's servers, so i mean, as much as i thought he was brilliant, i may have to lump him in with namon johnson. he may have gone to the johnson business school. you know naven >> i think i do. that's from "the jerk" right >> right he had continuing education from the naven johnson business school, rather incredible.

i don't think he knew what he did. >> it's quite a story. >> it's incredible due diligence mcdonald's did no, none they didn't check the emails how could they not check the emails they looked at his personal phone. >> now is when we say the word puriant. >> i know pornography when i see it >> yes you do. >> easterbrook still put up good numbers. photo vamping himself having sex with women nevermind, that was out of line with that. >> that's all right. we're cable. speaking of, i don't know what, mm which "mad money" coming up tonight. >> i have philanthropy, ebony beckwith talks about what salesforce is doing to help schools open ed pesica, owens & minor ppe

and don wood will defend the shopping center and says it's alive and well, except for the gymnasiums and some restaurants. david, i would love to stay for the next hour but there's some social distance thing that makes me have to say i'll see you later. >> okay. atsa la vista, baby. >> i'll be back. >> yes, you will, you always are, thankfully. for now, good tuesday morning to everybody welcome to another hour of "squawk on the street. i'm david faber along with sara eisen, nice to see and mike santo santoli. good morning to both of you. mike, jim and i were talking about the markets the nasdaq is down and so many of the names we know so well that have such enormous market caps are down but you're seeing other signs of life in the market >> for sure. it's a move out of what was perceived as safety, the big growth stocks, the ones that benefited from this stay-at-home

and low yield, low growth, high liquidity world rotating into more cyclicals it's stuff that benefits from an acceleration in the economy. you're getting a tailwind sentiment wise from the fact it looks like you have a very defined downtrend and new covid cases at least right now similar to may, where you had this big downturn, people got encouraged about that and no way to refute the bullish case on that for a few weeks or months now, that being said, i think one of the things to focus on is that it's netting out in a positive direction in other words, it's not just that the big growth stocks, huge parts of the index are declining and weighing everything down, other stuff is up more than that is down in market cap. that's why the s&p inching higher, up a quarter percent it would be a head wind if the big growth stocks continue to be heavy but not necessarily unhealthy way longer term how the market might behave. >> sara, any thoughts on the dollar or fixed income we were talking the last hour about this incredible high yield deal done at 2.87, something like that, well below 3% for ten

years' worth of money. >> are you talking about ball corp., 1.3 billion of junk funds? yes, record low yield which gives you a sense of the powerful credit rally that's going on beneath the surface which sort of confirms the bullishness in the equity market what's happening in stocks, the amazing more than 50% rally off the march lows is testament to two things i think the incredible science that's going on behind the scenes for vaccines and treatment and gathering all the resources and the power of stimulus, whether it's monetary or fiscal, and those two factors alone really have been responsible. i'm just watching the nasdaq down for a third day, david. we haven't seen three sequential down days for the nasdaq since early march. so it's pretty unusual to see, given your point about the rotation, what's going on, just other bullish factors out there,

transports going strong, nine days in a row, small caps are making a move higher so it's all coming together, and it tells a pretty strong narrative, whether it's a lower case count, the stimulus out there, president trump talking about cutting capital gains, obviously we'd need congress to do that but that just sort of is adding to the enthusiasm this morning on what has already been an incredible run >> yes and something else adding to that as well as hopes for a vaccine, this time from russia, as unusual as that would seem, president vladimir putin announces it approved a vaccine. matt wagner is on the ground, can bring us up to date what we know or don't know about the real potential of a vaccine. matt >> reporter: thank you, david. putin said it's safe and effective and provides a long-term, stable immunity but the problem is that there's actually not been any long-term studies into the effects of this vaccine. it's only been through phase one and two trials, so we're talking

about a vaccine that may be at least under official clinical condition up to 100 people injected with, so basically the best way to characterize what's going on here today is russia decided to do its phase three trials live. production is just now going to start ramping up this month, but the first group of people, probably about a thousand, to 1,500 people will be doctors, so these will be medical professionals kept close at hand, while production building into september and october sources put out tens of thousands of vaccines per day. russia says by early next year, wants to put out millions of doses per day so really they're doing this live, and so we'll see what happens now nothing has been published about this vaccine we kind of have the word of russian officials, some of which have said they themselves have taken the vaccine. putin said today his daughter has been injected with the vaccine and it's a two-stage vaccine and on the second stage the people who claimed to take it say they've been experiencing

just a little bit of a fever on that second day. this is a symptom that needs to be studied likely and so we just, a lot of questions remain unanswered but russia is moving forward and claiming it is on the vaccine. the name they've chosen is sputnik, so it's pretty obvious what they want to you think about it >> matt, thank you it is pretty obvious what they want us to think our meg terrell reported extensively on these kinds of vaccines made the case they are very earl will i in, and if this was a u.s. company, we'd be nowhere near having this discussion, but appreciate your reporting. thank you for joining us the s&p 500 inches too an all-time high, the dow and s&p the eighth straight day of green, david costin joins us now. always good to have you. there you are. what do you make of the rotation in the market today? is it sustainable?

>> as you indicated, the positive news on expectations on the medical front has certainly been one reason for expectations, the economic activity is likely to turn up and goldman sachs economic forecast for next year, average annual growth for the u.s. economy around 6.2%. consensus right now is around 3.9% so it certainly has a more optimistic view than many people have on the level of business activity for next year and the idea of better growth still rests with technology so in answer to your question in terms of the day-to-day rotation, maybe we see today or last couple days, i think is

maybe missing the fundamental issue that interest rates are likely to stay extremely low sara made reference to that in the last segment, she made reference to the policy stimulus that's happened both on the fiscal and the monetary side, but the idea of better growth, longer term, is what characterizes the technology stocks more than anything else and the longer duration, the longer, better growth long-term is more valuable, more prized in a low rate environment that's the story if you will behind the tech argument, that's what i would put forward as to why to focus on the longer term growth cyclically some of the beneficiaries of improvement in near term growth, near term expectations, financials certainly beneficiary generally speaking, industrials more cyclical type of companies, but i think the longer term issue here, looking further out, is still where you get the better growth out of technology

>> even with evaluations where they are, david, the people who are saying go to value say look, you've gotten stocks that are a lot cheaper, and that are in good shape, and if we do get a vaccine and we do get better news on treatments and better news on caseloads and hospitalizations, which are all down significantly, those stocks are poised to rally, as this market broadens out and the economy starts to take off again. why wouldn't you go there? >> i think the way to think about that is the idea of catching up versus catching down maybe that's the idea behind the brief rotation the idea that the technology stocks have certainly been the key driver of the recovery from the lows in march, and so the idea of either the leading technology companies have to begin to underperform in order for other areas to outperform, obviously moving in both directions, is that basically a

convergence that's taking place, and so that's about, what's the investment horizon is the investment horizon from now through the next couple of months is this through the election where does one want to position a portfolio over time? i would argue that the fundamental argument of where the growth is happening still is in technology. what did we learn by the way what did we learn from the earnings season that was just pretty much just completed right now? you had companies that had very disappointing earnings in the top line but of course the level of expectations had dropped so dramatically that actually it turned out that it beat expectations because of that low bar, so that's one observation second observation is that you had companies that were able to keep their costs under control quite dramatically, and that was a major take-away. we had expected that margin would contract pretty significantly, like 400 basis points, they came down by around

250 basis points so you did not have the same level of margin compression that we had anticipated, but the third issue is the difference in the split, sara, between the larger cap companies and the smaller cap companies, and i think this is an important observation that the larger companies were able to control their expenses much more, much better than the smaller companies. small cap stocks, russell 2000, your year over year growth was basically down 100%, didn't have any concernings. when we did a survey of the goldman sachs 10,000 small businesses, which is a group of companies around the country that goldman has been supporting and working with for the last decade, we did a survey of 10,000 small businesses and the response was that 86% of these businesses that we did a sample survey of those required or looked to the ppp program to be extended and they'd run out of money by the first week of august so one of the key aspects of the

rotation in the cyclicals that the presumption that you're going to get or the expectation i should maybe say the expectation you're going to get some sort of movement in washington on some of the fiscal side of the ledger, which remains to be seen it's a risk, if you will, exactly how that will play out inside the beltway >> yes i was going to say, on top of better cost control and really low expectations, david, didn't we also learn, though, the power of stimulus, the fact that you know, the government has been putting a lot of money in people's pockets, and that has really helped consumer discretionary income go up, and if that continues to flow, do you expect that to help earnings beyond just this quarter >> well, it's obviously a vital issue from an economics point of view and for the market. the consumer is roughly 70% of the u.s. economy, and so clearly the ability to extend the

unemployment benefits and other income replacements, the ppp program, things like that, were instrumental in allowing so many companies to, you know, maintain their business activity, keep their employees on their payroll, and question is, what's going to happen in d.c., whether they can extend that, whether they will extend that, for example, is important, in order to get the economy to continue but ultimately, the economy needs to repair itself in its own right and i think that's why the medical issue becomes a central area of focus. there's the medical questions which obviously some of the assumptions we're making are probably more optimistic or more positive perhaps than others in terms of a vaccine available by the end of the year. good amount of the u.s. population knock clinoculated b

first half of next year, that would be beneficial for broadly speaking the u.s. equity market over time. then the question is the election the election is fewer than 100 days away from now, exactly what the outcome remains uncertain, it could remain uncertain long after the november 4th date, given the number of absentee mail-in balance the los and exactly what policies will be transpired one of the issues we have is our baseline forecast for earnings next year, profit forecast $170 for the s&p 500, depending on different assumptions regarding the tax rate, that could be somewhat lower, our estimates would be something in the vipt vicinity of around $150, around $20 potentially lower level of profits if you have, want to assume for a moment you have a reversal of the tax break that took place at the end of 2017. so if you have lower profits and

a 20 times multiple roughly where the market is trading now, $20, that's about 400 points in the s&p 500. i think that defines a trading range or an area we should think about as the prospect or risk, if you will, of some policies. policies remain uncertain. maybe that doesn't happen. maybe the tax rates stay unchanged, maybe there's more fiscal spending, infrastructure spending that could be to the positive side. i think that's a big subject of discussions with fund managers right now. they've shifted away from the vaccine, everyone mostly on the buy side, hedge funds, mutual funds, portfolio managers expecting a vaccine by september, october, to be announced, some of the test results to be positive in terms of the early studies, so that's less of a focus that we get in terms of incoming questions, less of a focus in terms of economic activity, more on policy and the election that drives a lot of questions of

compliance at this time. >> we're out of time, speak of it appreciate your taking some of it with us thank you. >> thank you, david. evercorps's roger altman weighs in on stocks at the bottom of the hour we're back in two minutes on "squawk on the street. dow is up 259. s&p just barely positive

it's a first of its kind study conducted by burbio to quantify decisions made in more than 13,000 school districtsaround the country. it found that 52% of students will be taught virtually 25% will be in school every day and 19% a mix of both. the study was conducted by burbio as i said an online startup that aggregates school and civic activities in calendars across the country a county level map which you can see shows differences between regions, between neighboring states and even within counties in texas which is a recent virus hot spot that has rural areas in the panhandle with in-person

schooling. they are in-person, southwest you can see mostly virtual but the northeast mixed and some in-person after progress of controlling the virus, in a trend with economic implications, burbio found a decided move towards more virtual teaching they said in a news release "we've seen a dramatic shift to online only learning in the past three weeks. many districts have thresholds for covid-19 levels that could result in converting back to remote learning" according to the co-founder of burbio the nation won't be fully open until activities are open and schools are fully open this study suggests the trend for the moment is going the wrong way. >> a lot of parents are going to have to stay home. steve, thank you steve liesman. let's bring in former fda associate commissioner peter picks to talk about not only

what to expect this fall but the viability of russia's vaccine claims this morning. good morning, peter. thank you for joining us obviously a huge headline but a bit of vaccine nationalism going around what do we know scientifically about this candidate that russia announced? >> it's a complicated question what we know is exactly nothing. it's less of a vaccine than a molotov cocktail thrown into the covid-19 conversation. no data, no science, no backup there's no record in the w.h.o. database of any russian vaccine program, no such thing as the russian fda. there's a history of substandard and counterfeit products, very little oversight, so my confidence level is exactly zero at the moment. >> wow all right, so no question about that i guess it's not comforting putin gipew gave it to his daughter to take? >> maybe he did give it to his

daughter or didn't churchill said this is a riddle wrapped in a mystery inside of a enigma, classic russian move the same country accused plauzbally of hacking into western databases to steal vaccine scientific development it's hard to say what's real and what's not i think a great deal of caution is called for beyond the headlines. >> peter, back to the world of science, which i mean, well, in this country at least parts of it we are advancing, and companies are advancing on a vaccine where do you think things stand, when do you believe that we will see a commercially available vaccine from a reputable manufacturer/company/government? >> i'm pretty optimistic we'll have a vaccine or more than one vaccine quite likely in early '21, february, march i hope it's earlier but that's nigh bet at the moment the reason i think it's important that we place our bets on the larger multinational companies not only to have good

science, you clearly need that to get the vaccine done and the manufacturing chops to make sure it's done to scale on a global level so i'm pretty optimistic, because a lot of the programs are done by major players and making very good progress. >> and peter, to the question of reopening schools or not, how are districts in your mind making this calculus is it correct? what are the major risks right now based on what we know about transmission levels and whether we're going to generally expect another surge perhaps in the indoor weather season? >> well, i think that the danger here isn't so much for students, because whether you're 8 or 18, the younger you are, the less likely you are to have serious complications or any manifestations at all, the asymptomatic population. we have to protect the people that work in the schools, the teachers, principals, all the school employees and that's why it's important to test, test, test on a regular basis, and also why we need to hold out to make sure that teachers are among the first people to get

vaccinated once we have a vaccine for general use. >> on the vaccine question, clearly you have zero confidence in russia's announcement today, peter. we have much, i would say more vigorous protocols here at the fda. you worked there there is this question going around, though, about whether these vaccines are being rushed, say whether it's around the election, or just to get it fast we need it we desperately need it to get our economy and our society back online do you have any questions about the speed of which this is happening, and whether corners are being cut? >> well, there's a difference between rushing and expediting you rush, you cut corners and make mistakes and that's not acceptable either on a developmental level or on a regulatory level you expedite, what you do is put your best brains against the task at hand and that certainly is what's happening inside the fda. it's all systems focused on covid-19, therapeutics and vaccines i'm entirely convinced that it is going to be done robustly,

appropriately, and that when a vaccine gets approved by the fda, the american public can be absolutely assured that it is safe and effective and that's important because there's no value in having an fda-approved vaccine if people don't want to get it i see numbers that say 30% of the population won't get a vaccine once it's ready. that's not acceptable. we need a huge public education campaign but i think step one is confidence in the public health system, and unfortunately, that's the issue we've got to discuss, there's hard truth we have to address and fix those problems >> one other problem has been testing, which has dogged us since the very beginning of the spread of the virus in this country, peter to mike's point, schools are going to be reopening, many colleges, universities as well they're going to be reliant on a lot of testing, that's kind of part of their strategy to keep themselves open and have students on campus is there going to be enough testing out there and fast enough to actually allow all these schools to do what they want >> there's never enough testing and it's never fast enough

clearly new tests all the time, they're never 100% perfect what we need our tests that are highly accurate that can be turned around quickly and i think we're getting there quickly. i suspect by labor day, a very large supply of more accurate tests that can give us results immediately or in a few hours, and that's what we're going to need because we'll be going back to work or back to school, test, test, test, test, test, it's the mantra we have to follow >> and then there's the third leg of all this, peter, which is treatment, and i feel like a lot of the doctors and sources that i talk to on this front are all really excited about monoclonal antibodies and the phase three trials happening from regeneron and lilly, as of a bridge something to give as treatment and something to give prophylactically to the elderly population or health care workers until we get to the vaccine, why aren't we hearing enough about that? is the u.s. government focused on that in terms of putting money there so we can

manufacture this at scale if and when we get the results and they work >> we definitely are therapeutics are important on the one hand we've learned since the beginning of the pandemic how to keep the at-risk population, seniors, those with serious health care conditions, respiratory issues alife when they get the virus, they go to the hospital they walk out ali alive. we managed to do that. here in new york we suffered the consequences keeping people alive. that's part one. part two is we need more tools we have remdesivir, convalescent plasma is going forward rapidly. if you had covid-19 please give blood. that's a high potential proposition. hydroxychloroquine, see whether it can be a preventative, not optimistic but it's solid science. the better our therapeutics are, the more of a bridge it will be until we have a vaccine but especially important for those at risk. >> peter, thank you.

appreciate your insight this morning. >> my pleasure, thank you. dow up right now we're looking the airlines today, ticker j.e.t.s. continuing to rise, up double digits from a week ago major carriers after their highs. they are still higher all across the board about 1% or 2% despite the recent rally, united still losing more than half of its value this year. american and delta not far behind so there's the longer term perspective. we'll take a quick break here on "squawk on the street. stay with us nasdaq is down 61 points, third day in a row, something we haven't seen since early march we'll be right back. hey there people eligible for medicare.

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welcome back i'm rahel solomon. here is your cnbc news update at this hour. a surprise move. seattle's police chief announced she will resign next month, the move came hours after the seattle city council voted to slash the budget of the police department she says she was not included in the budget conversations, seattle's first black police chief and member of the force for 28 years a series of storms have torn through the midwest. winds topped 100 miles per hour. in chicago the winds tore the roof off this house here and across illinois and iowa, more than 800,000 people are without power. and in wisconsin, the wind blew trees into houses and damaged a church steeple

a pontoon boat was flipped over and part of a dock was blown away overseas, flooding across somalia uproots hundreds of thousands of people. the u.n. refugee agency says that more than 23. if 23,000 people are displaced and more than half a million forced from their homes this year. that is our update for this hour more "squawk on the street" returns in two minutes

roger altman joins us right now. good to have you and see you >> hey, david. how are you? >> i'd love to start off on the broader market i don't know if you have an answer but i bet you get this question, i do certainly from people who may not be as sophisticated in investing and simply say i don't get it. the economy is suffering, the country seems to be suffering, but what's going on with the stock market

>> well, it's the $50 billion question, david, because there's an obvious disconnect between market levels and the real economy, and if you look at the real economy, i'll come back to the market in a second it's going to be about two years before it just total gdp returns to the pre-virus levels. it's going to be longer than that before the unemployment rate returns to the 3.5% we had before the virus struck and 13 million americans right at this moment in february don't have a job today. so the real economy is struggling, and it was commentary on cnbc earlier this morning about airlines operating at about 25% to 30% of pre-virus levels the resilience of examples like that in terms of the market, obviously the record levels of monetary expansion between the fed balance sheet expansion more

than 3 trillion and the fiscal expansion, about 3 trillion also, that is driving the market upward, as it did in 2008 and 2009 and the market is looking ahead to it seems to me the second half of 2021, when we will be a lot stronger, and then there's the reality that as jason fuhrman puts it, if ten small consumer facing businesses close, and all the revenue goes to walmart, the stock market goes up and the real economy goes down. so there are all kinds of reasons for this disconnect, but there's no doubt that there is one. >> yes well said. let's get back specifically to washington it's been a long time since you've been there. things have changed a lot since the early '90s when you served as deputy secretary of the u.s. treasury give me your take in terms of whether you think we will get to

some sort of legislation, not executive order, but legislation that deals with the current crisis when it >> i hope so i have my fingers crossed and think so the executive orders don't do very much. whether you look at the absence of any assistance for state and local governments, whether you look at the very temporary nature of continuation of unemployment insurance, the federal addition to it, or any other aspect of the executive orders, they are a poor substitute, a very poor substitute for a robust piece of legislation. however, they may help bring about that fourth and final economic rescue bill, simply because they do put pressure on

negotiators i think to resolve their differences and agree. now i don't know that there will be agreement we've seen a pretty big gulf between the speaker, for example, and leader schumer on the one hand and meadows and mnuchin negotiating on behalf of the president. i don't know there will abagreemean agreement but there should be because we need this bill. bene we need a longer term addition to the bill for unemployment, need serious assistance to state and local governments. if we don't have that, they have no choice under state laws, which require balanced budgets, to take, implement severe budget cuts, that's economically contractionary, that's the last thing you need from an overall national fiscal policy point of view we need funding to enable schools to reopen, and deal with all the covid effects, and we need more assistance in terms of

covid itself, tracing, testing, and so forth so the executive orders are puny that's not a criticism that's just that you can't do much under executive orders in a situation like this, and i'm hoping that we'll see the negotiating differences close and in agreement because we need it >> roger, you say we need it it seems the market's assessment has been all the incentives on all sides seem to drive in the direction of some kind of an agreement, but is that, you know, is that necessarily the case if we now have the ability of the democratic leadership in congress able to say we passed the bill, did we could the administration said we did what we could, the other side is intransigent if you want to have a strong economy going into an election if you're the administration, maybe there's another battle to fight right there. i wonder if that calculus might have changed over the course of this >> well, don't get me wrong.

i'm nowhere near these negotiations, but i have spoken both to speaker pelosi and to senator schumer myself, and i think they both have the view that the country needs this, the vast number of distressed americans need this, for example, a continuation of the eviction moratorium, and i think they're prepared to put the needs of the people ahead of short-term political considerations i'm quite convinced of that. so i think that on the democratic side, they are prepared to reach a deal and not try to play this just for short term political advantage, and i hope that's true on the side of the administration, too. the country needs this also if you are the president, you need the stimulus impacts of this i mean, his margin in terms of who could better manage the economy has disappeared, more or less disappeared in the surveys,

the polls. so he needs this from a macro economic point of view so it would surprise me if they can't agree and that would be quite unfortunate. >> speaking of, roger, are you officially advising joe biden in his campaign >> i'm part of a large number of people, sara, who have a role but i am not a, you know, special group of part of some small group. i'm just one of many people. >> no, the reason i ask, roger, is because i feel like people, you know, in your world and our world on wall street can't figure out, if we do get a blue sweep, whether that would be stimulative for the economy, because we could see another round of huge government spending, or if it would be a net negative, because we'll see higher taxes what do you say to investors on that front >> i think it's going to be clearly good for the economy if you look at vice president

biden's plans, and his plans for example for a revival of american manufacturing and the related investments which he has proposed, i think it's the type of investment-centered agen da, which the country needs, and i think that the biden agenda would be better for the country than the trump agenda. you take a look for example at chi china. we have a really serious problem and it's a global problem with china, and what we need is to rebuild our alliances around the world, put together a multilateral approach to china, which can constitute real leverage on china, unlike this america alone approach that the president has taken, and we need just a completely different

approach to china, where the condition of our relationship with china now is at a 50-year low. china's done a lot to bring that about itself, don't get me wrong, but that's just one example of where we need a completely different approach, but i think the biden approach will be welcomed by the business community and by markets and i think it's going to be stimulus, and by the way, if you can find a lot of serious ceos who will say in private that they want the trump administration to continue, i'd like to meet them. >> speaking of ceos, roger, i'd like to end all our conversations on a quick check-in with you on merger and accy wigs activity, ceo confidence deals seem to be getting done if they have to be negotiated virtually. what are you expecting for the back half of this year >> there's no doubt, david, there's been a pickup since the low of mid march

it's like the ice thawing in the spring everything went on into the deep freeze in mid march, when the virus erupted and the lockdown took place and now there's been a thaw, a very considerable thaw i don't see us returning to the levels of 2019 a month from now, meaning global m&a totals but we're moving back up and i think you'll see continued increases in m&a activity as you yourself just said. >> roger, great to get your thoughts and opinions. thank you for joining us >> my pleasure, david, all the best >> and to you, roger altman. tomorrow, to not miss the cnbc small business playbook, taking place virtually this year, industry leaders like sheryl shand sandbeandberg withe resources businesses need to this drive today and tomorrow, visit within/event.com/smallbusiness playbook to register

we'll be back with "squawk on the street" after the break. the dow is up 330 about. ♪ come on in, we're open. ♪ all we do is hand you the bag. simple. done. we adapt and we change. you know, you just figure it out. we've just been finding a way to keep on pushing. ♪

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and a mixed picture as far as the sectors, but financials are the big outperformers, getting some support as yields on ten year benchmark treasury debt climbed to the highest in months and check out jpmorgan, wells far fargo, bank of america and smaller regional banks as well regents financial, truest financial, key corp, all up double digit percentages in the past week and extending those gains today. more "squawk on the street" coming up.

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it has certainly been a tough few months for hotel chains with red roof only averaging slightly above 60% occupancy as the pandemic continues to ravage the hotel and travel industry. joining us is andrew alexander to discuss what he is seeing thanks for being with us you have, what, 650 properties coast to coast >> we do >> what are the occupancy levels like right now >> so we've seen sort of a stabilization, you described it in that 60% range and we feel fortunate to be there. much of the industry is really having much lower occupancies. and we've seen some pretty favorable results. it has been steady now and we expected to see a bit of a dropoff as the covid-19

infections returned to certain states, but really we haven't. we've seen a pretty stabilize the virn environment for our segment at least. >> when i think about some of the safety questions and concerns consumers might have, i guess being in your own room especially if you are sanitizing which i assume you are what about elevators, lobbies, restaurants, how do you manage people and crowd control there >> so this was -- for red roof, our long term future -- i mean our long term success is based upon being the cleanest in our you segment. and really what we're doing here with covid-19, we launched ready clean and that is an extension of our history and it is so important because it is what is going to bring the traveler back. they need to have confidence that we are providing them a

clean and safe environment so multiple cleanings of the lobbies, we're using face coverings at all of our properties we're trying to actually balance the amount of interaction our guest service representatives have with the customer so keeping that social distance, entering the room are to cleto e room only when necessary, but lin we when we do, making sure we hit the touch points multiple times to keep the customers safe as possible. >> your footprint is largely franchised so how do you make sure that you ha have consistency throughout the entire network and what is the financial condition of your fran ch franchisees, has there been stress >> absolutely there has been a

lot of stress. and we've helped our franchisees out with franchise fee reductions and initiatives to help their businesses and keep them in business but we've asked our franchisees to pledge, we've asked them to pledge that they will uphold ready clean, the new initiative, and we've had fantastic results. they have all agreed to jump are on board and be all in on being clean and safe for our guests. but in determines of their results, the economy segment really has been the sweet spot, right? so in the last stages of the -- right before covid, we were the lag aurd of tgard of the industy but now we're leading. why is that? first of all the economy segingment itself, we're not dependent on the large group house type of business and that certainly has gone

away what we are dependent upon and as a brand what we focused on for our 46 years is that b to b traveler that now all of a sudden we're calling an essential traveler and that is perfect, that is a sweet spot for red roof. so the transportation industry, the construction industry, the medical personnel who are staying closer to their provider so they can be there as often as necessary. and of course utility workers and that type of traveler that are still traveling today. they haven't gone off the road so we've seen a big uptick because of that. but i think maybe one of the most interesting things especially in the last two months as we're learning more about covid and we're learning that it is airborne and that is a key to -- that is a key to

transmission, our exterior quarter properties are back in vogue. it has been 20 years since i could say that but right now, the traveler is looking for that exterior quarter property where they can go directly from their car to their room, each room has its own individual air conditioning unit, so it is repsysicycling f air and not using the air from the remainder of the building or sharing air between rooms, that really has become an important point that travelers are seeing and they are feeling that that is a safer environment for them. >> andrew, thanks for joining us >> thank you >> appreciate it a quick check on the markets right now, we're seeing the dow and s&p 500 higher, shift away from the nasdaq and technology trade continues for a third day in the row dow and s&p are up for eight days in a row. we're looking at the first eight

day win streak since september if this holds. and we're also on the record watch for the s&p 500 if we get a gain or so about 1%. but the dow has been outperforming led in part the by some of the industrial name, financials are also doing well with the big jump we've seen in yields over to you, jon fortt >> thank you, a good place to start. squawk alley, good tuesday morning. i am jon fortt deidre and mike will be joining me and meg terrill has more on the story of russia touting a new vaccine. >> and we have to start with the caveats. while it is an improved vaccine to russia, they are improving it based on very limited testing. only a few dozen patients according to reports that ha