to at this point up about 215, s&p futures turned, too. the nasdaq still weaker. brian, mike, i want to thank you guys for being with us this week, it's been great having you here meantime, everybody, make sure you join us back here on tuesday. "squawk on the street" starts right now. ♪ good friday morning, welcome too "squawk on the street," i'm carl quintanilla with sara eisen and kayla tausche. coming off that biggest drop for stocks since june, futures are mixed as the dow and s&p look to stabilize, we will see about the nasdaq the august jobs number up 1.37 million in line with consensus, that unemployment rate much better than expected down to 8.4 and we will talk to vice president mike pence later on this hour about that data. sara, as we dig into it ourselves with pretty good numbers on government hiring, workweek is up, labor force participation and a lot more.

>> a lot of the jobs that have been lost since the pandemic are being recovered. no question it was a much better number than was expected with the headline being 1.4 million jobs added and the unemployment rate going below double digits for the first time since the pandemic adding it all up we now have recovered since april a total of about 10.6 million jobs, which is huge progress, but it also leaves a huge hole we still have 11.5 million fewer jobs than we had in february which was the month before the pandemic so we've still got to dig ourselves out of the hole and we've still got to look at the permanent impact of all of this. one in the numbers i went to first in this report is the number of people seeing permanent job losses it did rise by about half a million. it's 3.4 million so that is the highest level since 2013 and does point to the fact that there is going to be some permanent scarring despite the fact, carl, that we are seeing progress, it's moving in the right direction. the jobs that have been lost are

adding them the fastest. leisure and hospitality, retail, those lower paying service sector jobs which were the hardest hit are coming back. some of the hardest hit groups like latinos and women saw the biggest decreases in unemployment rate, that is good progress overall, but i think there are some longer questions that we need to dive into and the implications for that. >> kayla, we will talk about that as we said with the vice president to sara's point about permanent job losses up to 3.4 million. we've seen sort of anecdotal evidence of that in the recent weeks, whether it's mgm or coke or mersk or salesforce.com companies uncertain about the future, number one, and number two, paying higher prices for goods, trying to offset it with head count reductions and that's going to be a question whether or not this scarring to the labor market in general is more permanent than we think. >> and that's going to be one of the questions that we put to the vice president, certainly there

have been many companies that have been right sizing or downsizing to try to shift their workforce to fit the future economy and even in this jobs report you did have 3.3 million americans who are working part-time who would prefer full time work and that is certainly a symptom of this pandemic and the fact that it is going to be a low grind as businesses figure out exactly what their needs r to be sure even with 300,000 jobs added by the government, largely because of census hiring that is getting back on track as the coronavirus gets a little bit more under control, more than a million jobs created in the private sector in the united states, that is no doubt a very positive number and is going to be one that you can expect the white house to talk about quite a bit. so use as a tailwind going into the final two months before the election and, sara, i will toss it back to you. >> no, i was just going to ask you about what this means for stimulus because on one hand we had an 800 point down day on the dow

yesterday, worst day for stocks and there was some chatter that a few of those days added up together and you might get some urgency there on the congressional front to come up with a stimulus plan when all they're focused on is the election right now, but then you have a better jobs report, which doesn't exactly add to the urgency. it's one of the reasons i'm watching the market reaction very carefully a 200 point up day on the dow, a rebound from yesterday, but again, it does sort of raise the question jobs and markets and whether that's bred some complacency from the democrats and republicans on passing another stimulus bill. >> it's important to remember who holds the stock market in higher regard, republicans watch the stock market as a barometer because it is one of the most critical statistics that they are using to talk about the economy and the recovery and they want to be able to reference that going out on the campaign trail and talking about the fact that the president is the one who is building the economy back the democrats have been acknowledging that the stock market is not the economy.

they have been talking a lot about the plight of the worker, the 29 million workers who are still collecting unemployment benefits and so they have sort of seized on the disconnect between the stock market and the economy. so it's unclear that a drop in the stock market would incentivize democrats to move. now, with he did have a development in the last day with nancy pelosi's office suggesting that her conference would support a clean continuing resolution to keep the government open at least through mid-november so that would sort of separate the two very toxic debates over funding the government and at what levels and whether -- and what size stimulus package you would need going forward but we don't know exactly where the republicans stand on that package and whether they would prefer to combine these because this is the last must pass piece of legislation before the end of the year and i've talked to republican aides who say if the covid relief bill is not attached to this it's not going to get passed. so we will see whether that actually seals the fate of

whether we even get any future relief carl >> well said, kayla. we will talk more with the vice president in a minute. in the meantime the conversation pivots around the jobs number, around government support and of course the technical aspects of trading that really came into sharp relief yesterday for more on all of that david kelly joins us today and diane swank. happy friday good to see you again. >> glad to be here >> good to be here. >> diane, let's start with the jobs number itself, the word "satisfying" was used from some guests on "squawk box" this morning. do you go along with that? >> i'm glad to see more than a million jobs created in the private sector, that certainly is good news, the pace of job creation, though, is slowing especially once you strip out those census workers which will be laid off again at the end of september. there are some things that i think are important is that sara noted as well, as the underlying

fragility in some of this data, the number of workers that actually were being paid by their work but not at work that reflects the ppp loans and they are the ones most vulnerable to be cut as we move into the fall. so see the slowdown in the pace of hiring and pace of recalls and not being able to generate new jobs in professional services over half of the gains came from temporary services that's the complete opposite of what we saw pre crisis there's underlying fragility in the data even though we are seeing the above a million gains. if we get below a million into the fall which is my concern when the headwinds pick up you will take long for regain what we lost let alone create new jobs and that's one of the things i'm concerned about, especially for women great improvement in the unemployment rate, yet the participation rate for women stayed stagnant. much of the increase in

participation came from men and teens. you can also imagine many teenagers are having to have to supplement their families that now don't have that extra supplement in their unemployment insurance and they are having to work when their mothers can't. >> right you've done a great job at highlighting some of the inequalities that we're seeing even amid the broad recovery, diane. david, as for you i'm wondering relative to expectations not so much this number for august, but in terms of, say, the unemployment rate at 8.4, that's not only below double digit but it's below some of the year-end targets that we have heard from sales side analysts and fed officials themselves, like bullard. >> well, yes, but, i mean, it's a very volatile number what originally happened was between february and april 25 million jobs were lost in a household survey but only 22 million jobs were lost in the payroll survey you have the tale of two surveys. today the employment number the

household survey came back in line with more of the payroll survey there's still 3.7 million people less in the labor force than was the case back in february. these are people who stopped looking for work as we go month after month with normal unemployment benefits a lot of these will scramble basically to find any job and because of that i think unemployment could pick up again. if you added those 3.7 million people back in you're talking about a true unemployment rate of about 10.7% it is better, there is improvement here and i'm glad to see the improvement we've seen but we really do need to cure the pandemic if we're going to get that other half of the 22 million people who were laid off in the pandemic and if we're going to get them reemployed we have to get to the end of the pandemic >> so it strikes me that david and diane and i we are all pointing out the fact that there's still so much underlying weakness in this jobs market we haven't even mentioned the fact that there are 29 million americans that are still collecting state and federal unemployment benefits, but

clearly wall street and the white house and everyone appears to be encouraged by the direction that we're going in, as we should, david. i think it raises the question for the market, it's sort of like the fed balance sheet question, the stock versus flow. is it enough that we're going in the right direction and that we continue to see improvement for the stock market to keep its record rally or at some point is it going to wake up and say this is still record levels of unemployment with some serious question marks about what this economy looks like. >> i think the trend is good and i think the trend of improvement for the stock market or for the economy is what the stock market is latching on to but particularly when you look at mega cap growth stocks in the u.s. they have taken on board that trend and added to it so we think that they've moved up too fast on this perhaps. we will get out of this pandemic, but we will get out of it with a lot more debt, i think interest rates will have to go up in 2021-2022.

i think investors should be cautious here and just think about the value of what you own. there are plenty of things in the middle of the equity market, plenty of international equities which are a lot cheaper than the u.s. mega caps and i think to some extent the market is overestimating the importance of this rebound >> does this economy need an extra stimulus package if we continue to see jobs numbers like this, 1.4 million added each month and hopefully more than that, do we need it? do we need the extra ppp and the extraen employment benefits? >> oh, we absolutely need it what we're still seeing is, in fact, the fragility of those workers that how many, 11% of the workers they surveyed were attached to the workforce via some ppp that were employed and working, but not actually at their job. they were counted as working and not at their job, they are very vulnerable for the ones that get cut as those ppp funds run out

we are also seeing we know that the $300 per week that is sort of trickling in does not apply to all of those collecting unemployment insurance at this stage of the game, those that get less than $100 a week will not get that extra $300 and it takes time and worse yet it only lasts for three to four weeks. they're sort of thinking within the next month or so the people who don't want to provide stimulus are saying, well, it's all over we won't need this. i think the theme that all of us have been getting back to is there still is a tremendous amount of scarring and those that are scarred the most in terms of longer term unemployment and permanent layoffs are those that are least affected by the strong gains in the stock market. >> david, you said back in june that this will be a recession that begins with the virus and ends with a vaccine. i wonderif you still believe that's true given all of the economic data that we've seen in the last few months, do you still believe that the economy will continue to be at recession levels until we see that vaccine approved, even if it's not until

early next year or do you think maybe we're getting rosier data than we expected >> no, that's absolutely what's got to happen. it's kind of like jumping off a cliff on to the trampoline, the bounce is impressive but the fall is what's important we will get a big bounce in third quarter gdp, it could be 30% but that's going to leave the economy down almost as much as it was in the great financial crisis peak to trough. we will still way below normal from there on a slow trudge, 3% to 4% gdp growth rates until we get a vaccine. people talk about stimulus, not st its not stimulus, it's supporting people's lives until they can get back to normal. there is not much you can do if you are a hotel or restaurant worker that's been laid off in a city that depends on tourism you have to support these people and focus on killing this virus as quickly as possible in 2021 by public health measures and by the introduction of a vaccine. it's important to support people through this because this is a v interrupted economic recovery. it's not going to get all the way back to full health until we

can deal with the pandemic >> diane, as we go into the holiday season, which is so important for hiring, we're already getting some good news, though fedex plans to hire 70,000 workers for the holiday which is about 15,000 more than it usually does do you think that holiday hiring will remain at historic levels or do you think that we'll see that suffer as we get into flu season now which could dove tail with future outbreaks? >> i think here is where you see the bifurcation, of course, the move to online supports hiring from delivery services like fedex but on the other side of it as we move into the winter months if we have not contained the virus and david is absolutely right, it's the virus that determines the course of the economy. after a big rebound we could see a sharp slow down in momentum as we hit the headwinds of colder weather, restaurants not being able to serve diners outside, more cuts, many restaurants not able to sustain their models

with a much more diminished indoor dining. also the pull back halloween is one of the second largest holiday for retailers. people can't do the things they once would do and now you're can you get into celebrations all the ramping up that usually goes on in terms of everything from corporate celebrations which we saw collapse in the fall of 2008 you will see even more of a collapse in that in this fall. so spending by businesses and by individuals more afraid of going to some of these places to congregate, that's going to slow down the pace of the recovery and i agree 100% with david on that we are looking at less than 2% growth in the fourth quarter without additional aid that's very important of a slow down after a near 30% gain in the third quarter which will be sort of rallied about, but talking about this economy in terms of growth rates really misses the fact there were only at a small -- we are still well below our previous peak and we have yet to generate new jobs

again and so to get that job generating machine that we are going to need on the other side of this, with he could see some long term scarring to that as well and that's what we worry about as we go into the fall without additional aid. >> say that one more time, chip. sorry. >> no, that's okay you also have to process the world health organization yesterday saying they don't anticipate widespread vaccination until mid 2021 guys, thanks so much appreciate it. on an important day. have a great long weekend, david kelly and diane swonk. you see at the bottom of your screen a news flash from amazon announcing plans to add 10,000 more jobs, this is in addition to the 15,000 they announced in february for their location in bellevue pretty interesting blog post here, sara in addition to the new roles an additional 2 million square feet of office space in downtown bellevue by leasing some new iconic properties they add so between the fedex hiring, 27% increase in seasonal hiring year

on year and now amazon, i mean, shipping goods around the country is going to be a big source of employment this fall >> that's exactly what diane just said, look for the job gains to be added this holiday season in e-commerce there's very little visibility in terms of what demand is going to look like for the holiday season, that's been a recurrent theme in some of the retail earnings we've seen this week, carl, but one thing is for sure, kayla, and that is they are expecting it to come from online signet jewelers which is the quintessential mall-based retailer, they own jared and zale's, they are all over the malls. she told me yesterday, the ceo, that they are increasing their online thorough put by five times this holiday season. that was as much they could see into the future as to what's coming and this amazon job announcement just proves the point. >> and the pandemic is just expediting all of those structural changes that would have eventually come to the economy. coming up in just a few minutes we will have the vice president mike pence to talk about jobs

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your wireless. your rules. only with xfinity mobile. billions in losses yesterday for bezos, musk, zuckerberg and gates in that dramatic text selloff. robert frank joins us with the breakdown. good morning. >> good morning, share rachlt crazy numbers on the way up and now on the way down. the top four billionaires losing $25 billion just yesterday, some

of them on track to lose billions more today. jeff bezos was down $9 billion yesterday. he is still the world's richest man with $198 billion, but elon musk had the most dramatic losses he was down $9 billion yesterday, but down $19 billion just since tuesday which is more than rupert murdoch's entire net worth. he had a crazy week, became the third richest man on monday passing mark zuckerberg but now he is back down to four, he's still up $67 billion for the year so he won't have to pawn any rockets anytime soon zuckerberg also down $4 billion yesterday. old tech not immune here, bill gates and steam bomber losing billionaires here is a name we didn't hear much about yesterday, the biggest percentage billionaire losing was dan gilbert with rocket mortgage, he lost $7 billion that he was 15% of his net worthwith that stock down. carl, back to you. >> all right

robert, some amazing numbers, as you said, on the way up and on the way down when we come back, as we said, the vice president on the jobs number this morning, stimulus, vaccine and a lot more we will also get you up to speed on tech plays, momentum which are not rebounding in the market the way the s&p and the dow futures are. back in a moment this is decision tech. find a stock based on your interests or what's trending. get real-time insights in your customized view of the market. it's smarter trading technology for smarter trading decisions. fidelity.

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taking another look at futures as we count down to the opening bell the s&p and the dow are set to open into the green, the dow by triple digits. nasdaq would open in the red, but we'll see whether that changes in the next few minutes. we will have the vice president mike pence just a few moments stay with us

>> announcer: the opening bell is brought to you by nuveen. a leader in income, alternatives and responsible investing. >> my own gut feeling is that the liquidity conditioning is still strong and if it's not then this market comes on by a lot more we could have another 10% fall easily if, i want to stress, if people start thinking fundamentals >> el-erian making a call yesterday on closing bell that we could have another 10% correction if the market starts paying more attention to fundamentals versus technicals

which i think spoke to a lot of people because we've been constantly talking about the disconnect between the markets and economy certainly on the way up when the stock market was hitting a record high after record high. after yesterday's ugly wipeout we are still up 7% on the year for the s&p 500, we're still about 3.5% away from a record high on the s&p 500, 5% off the high for the nasdaq, but the nasdaq is still up double digits for the year it was a blip, carl, but i think the question and mohammed was willing to stick his neck out with the 10% correction call is was yesterday just sort of a health yeah kind of correction as things were getting frothy and overcrowded and positioning was getting a little bit too bullish or was the start of a more meaningful correction where markets and investors do pay attention to things like permanent job losses, very elevated levels of unemployment, bankruptcies, maul business closures, all the things where you're scratching your head as the market reached a record

high. >> yeah, but your point is a good one, sara, and that is that a lot of regulars who came on our air as the markets were going crazy up, i'm thinking tom lee, el-erian, dig cock costell saying they were uneasy with the number of new highs coming down, with the vix going up as we see it at 54 today with the breadth over all. to some it wasn't a matter of surprise, it was a matter of when and certainly we got it, highest volume on the trim qs yesterday, the third largest nasdaq decline coming off a record high in history i know you saw that statistic, sara, about apple's market cap loss yesterday, just the loss alone, biggest in one day for any company ever and bigger than 470 market caps on the s&p 500 i mean, that's amazing >> amazing, but it was also amazing on the way up how much it was gaining in market share

every day. an 8% move down for apple is a loss of more than $150 billion in market cap. i would also add cramer to this conversation because he would normally be here in the 9:00, we talked to him yesterday after the close and he was saying, look, take profits millionaires, new retail investors, take profits. it was just obviously the warning signs were all over the place. >> jim is another one which i didn't mention it because it's obvious, he is with us every day, but he was getting increasingly uncomfortable and was quite explicit about his advice to people to start taking some off the table in the face of those rising numbers. we will keep an eye on this today, sara. we have this ongoing discussion about how long it would take if it were simply positioning and the options market dominating trading how long it would take to unwind that it's certainly not a one-day event. we will have that discussion in the coming days even if you believe the fundamentals behind those names remain intact. as for today, though, sara,

you're going to see again banks react, dominic talked about yields going up a bit, a little more of a reopening trade as carnival is up another 4%. that's going to be -- you know, that's in line with the ongoing rotation theory if you are a buyer of that. >> if you are looking, yeah, the strength today is in financials off the back of those higher yields what was interesting yesterday about the big tech wreck that we saw which obviously took down the markets just as it has taken it up through most of the year is that there was a little bit of rotation in yesterday's action into some value names and underperformers. energy stocks fared well yesterday, the cruises and airlines fared well and today what we're seeing is energy is up again, materials are higher, industrials are higher, the only two sectors actually opening lower, carl, are technology and communication services which is where, you know, the huge run up had been actually, the nasdaq looking to go positive here as the positive

reaction continues to the job report, sales up 132%. the debate jobs versus value is very much alive. it wasn't a sell everything kind of mode yesterday. we didn't see a huge move into treasuries or the dollar, we saw a little bit of it but it wasn't an all out panic move. the sunday amount als in the last 48 hours have not changed that much. more improvement on jobs, continues with the story, we're seeing a little bit of flared up covid-19 inflections in states like alabama and the dakotas but the hospitalizations and the death numbers which wall street pays very close attention to have been stable, in a down trend. nothing really fundamentally changed. it's being blamed on a bunch of profit taking and overcrowded position things and very uh-huh rick sentiment that we last saw in the '90s which is really what's to blame here more than anything. >> i would counter at least as

it pertains to semi-conductors there's been a lot of news out of china this week, not just the idea that they want to have some say over the tiktok sale and how important those algorithms are, the idea that domestic chips in china would be part of a new five-year plan in the coming months the global times chinese state media saying that the chinese could trim their stake in u.s. treasuries by a couple hundred billion. as a result continued weakness in names like alam research, kla 10 corp. and nvidia, maybe another topic for the vice president. let's get to our kayla tausche once again. >> let's bring in vice president mike pence from the white house who has had a little bit of time to sift through this morning's jobs report. mr. vice president, thank you for joining us give us your reaction, 1.4 million jobs added last month and the unemployment rate falling to 8.4%. >> well, thanks, kayla, it's another great day for american jobs and american workers. i mean, there were some estimates that we weren't going

to see the unemployment rate go into single digits before the end of this year but because of the foundation that president trump poured in our first three years of less taxes, less regulation, more american energy, more free and fair trade and because of the relief efforts that we were able to secure from the congress of the united states, direct support for families, paycheck protection, today we see 1.4 million jobs added, the unemployment rate drops to 8.4%. it's a great day in america and real evidence that the american comeback is under way. >> to be sure, though, the pandemic has wiped out the 7 million jobs that the administration created up through february and another 4.5 million in net lost jobs since then how long is the white house forecasting that it's going to take to get back to full employment and how many of these jobs do you think are permanently lost >> well, no question that from

the moment the coronavirus impacted our nation from china that the results have been very, very significant i think in the month of march we had seen 22 million american jobs lost. that's what's really amazing is with this jobs report today not only do we see the unemployment rate nearly cut in half from its high point of about 15% but rather now we actually have seen 10 million jobs added back to this economy again, i really believe, kayla, that that's a reflection of the solid foundation that this president poured and we will continue to build on we're working with congress today for an additional relief package, but the last thing this economy needs is what joe biden and the democrats are advocating of higher taxes, more regulation, more economic surrender and the kind of energy policies that will stifle the american energy renaissance that

i've seen in high relief in traveling across the country to places like pennsylvania and new mexico and texas i mean, this president's advanced policies that have laid a foundation for this great american come back, joe biden and the democrats are advocating policies that would turn us back and for all those americans that aren't yet back to work, we need four more years of president donald trump in the white house. >> you mentioned the impact of the programs in the prior relief bill and the benefit that that provided the economy and getting a lot of these businesses to add people on to their payrolls. we learned yesterday that the democrats plan to pursue separately a bill to fund the government and a bill to provide relief a, will the president sign a short-term bill to fund the government beyond september, and b, will the president -- what is the prognosis for a relief bill if those two things cannot be

combined >> you know, from very early in this pandemic president trump made it clear that not only were we going to marshall the full resources of the federal government, the full resources of our economy to meet this moment, to put the health of america first, but he also said we're going to spare no expense to help families and businesses large and small weather the storm of the coronavirus pandemic at this point we've seen more than $4 trillion made available, the agreement reached this week by the treasury secretary and our negotiations team to have a continuing resolution to continue to fund the government when the fiscal year runs out at the end of this month means that now we can focus just on another relief bill and we're fng to do that in good faith look, nobody wants to give direct payments to american families more than president donald trump again i mean, we sent those checks to american families, it helped people through this tough time, we want to continue the paycheck

protection program which we think laid a foundation for many of the americans that are coming off the sidelines, going back to work we were able to preserve those job opportunities precisely because this president negotiated the paycheck protection program those are vital programs, we want them to continue, but what we've made clear is we're not going to allow democrats in congress to use a coronavirus relief bill to bail out poorly-run democrat states in the country. so we're in the midst of the negotiation and we're going to stay focused on american families, on american businesses, but this job report today tells you that the american economy is coming back, we're going to continue those policies that are equipping americans to make their way through this time, but we're also going to continue to take our case all across this country that we need four more years of exactly the policies, kayla, that have laid the foundation for this remarkable v-shaped

recovery that is taking place. i mean, think about that i want to say this to your viewers again. >> right. >> i mean, i think the federal reserve predict that had we wouldn't be under 10% unemployment before the end of the year and we are at 8.4% unemployment today i mean, we have literally cut the unemployment rate in half in just four months 10 million americans have gone back to work i truly believe that's a testament in part to the relief efforts but it's mostly a testament to the resilience and strength of the american people and also the fundamental strength of this economy which was -- which has been growing offer the last three years our first three years. on lower taxes, res regulation, more american energy and free and fair trade. >> okay. >> joe biden is in kenosha, wisconsin, yesterday and was actually bragging about planning to raise taxes on american businesses the last thing we need as american companies large and small are standing back up from

this pandemic is higher taxes. that's why we need four more years of president trump in the white house. >> and to be sure there is quite a bit of ground between where republicans and democrats are on relief and i know that you won't negotiate here, but you mentioned kenosha, mr. vice president and i want to talk about that violence and specifically the role that technology plays because much of the organization on both sides of the aisle has taken place on facebook which in recent weeks has removed hundreds of accounts both affiliated with antifa and affiliated with pro-trump groups i want to show you a couple in the latter camp because you speak for the president. this call to arms by the leader of the texas save the children group which has 14,000 members this leader brandishing an assault rifle and suggesting that demonstrators come to the rally armed and there was also the kenosha guard, a self-described local militia that posted this, any patriots willing to take up arms and defend our city tonight from evil thugs immediately before

f fatalities took place. what does the white house say to this and what is the role of social media in policing this? >> well, the president has been very clear that we want people to let law enforcement do their job. we want governors in states across the country to use their national guard, support their law enforcement and quell violence in our streets, but, kayla, it's been antifa and radical left anarchists have been driving violence in the streets of our city over the last three months and it's been this president who has made it clear that we're going to stand with law enforcement and we're going to stand for ending the violence that is besetting families, african-american families, other minority families and everyone who lives in our cities. the ruth is we don't have to choose between supporting law enforcement and supporting our african-american families.

we have done both in this administration, we will continue to do both in this administration, but president trump has been very clear that we need to stand up to the anarchists, to antifa that have been driving violence in cities across the country and we're going to stand with law enforcement and urge every american to let law enforcement do their job >> finally, mr. vice president, i'd like to get your response to a story that the atlantic ran last night reporting that the president on multiple occasions disparaged fallen members of the military the president himself and the white house on the record have vehemently denied this story but there were two generals who were reported to have been present, general done ford and general kelly, would you support their speaking out to set the record straight >> well, what i can tell you is i wasn't in paris but it never happened i talked to the president that day.

i know how disappointed president trump was that there was a bad weather call that did not permit him to fly to bella woods to honor or fallen there more importantly, kayla, look, i've been to arlington cemetery with this president, i've been at his side at dover air force base with grieving families as we've brought our fallen home. i have never been with anyone who cares more deeply about the men and women of our armed forces or respects them and their families than president donald trump and our records really speaks for itself you know, under the last administration joe biden was vice president we saw our military hollowed out by budget cuts, we saw people literally dying on waiting lists to get into the va, the va beset by one scandal after another. from day one this president has demonstrated his love and respect for our armed forces we rebuilt our military, record

investments in our armed forces and we reformed the va and end those decades of scandal so i reject this out of hand as everyone has spoken out on it and i think the american people see through this for what it is, just within more anonymous smear job with an election just a couple months away, but our armed forces like the two members of my immediate family know that they have a champion and an ally in president donald trump and they have a commander in chief who deeply respects them and their families and our veterans >> and if there were an opportunity for these two generals who were present with the president that day, are you confident that they would share that view that you just outlined quickly before we go >> look, what i'm telling you, i spoke to the president that day, kayla. i know why they canceled the trip to bella woods. to be honest with you, i just -- i think the american people just roll their eyes at these late hit anonymous source media

coming from the atlantic or anywhere else, it's just politics as usual. i mean, look at the record, look at this president and i've got to tell you to see -- to see the way he has stood with families at their worst moments at dover air force base when we're bringing our fallen home, to have walked the grounds of arlington cemetery with me, i just want to tell you, again, i don't need anybody to tell me president donald trump loves our respects the members of our armed forces like no one i have ever met, and that's why i reject this story out of hand and i guarantee you people across the country see it for what it is as well >> well, we appreciate your response, mr. vice president, and your time this morning to talk about the economy and so many other issues. we will close our conversation there. we really appreciate t thank you so much. >> thanks, kayla great day for america. >> vice president mike pence

so, carl and sara, you heard it right there, the white house believes that this is a rocking jobs number that provides strong leg for the economy to stand on going into the election with just two months to go. and you also heard the vice president talking about and acknowledging the role that some of these government programs played in creating this foundation under the economy which he referenced multiple times, the president pouring the foundation that we were on, but it does remain to be seen exactly how we get to that stimulus compromise with so much room between republicans and democrats and with the potential separation or the confirmed separation as he just talked about of the government funding legislation and the stimulus legislation which i know many republicans believe removes another motivating factor for lawmakers to get this legislation. sara, as we were discussing earlier this morning. >> no, it sounds like all the

focus now on both sides of the aisle, but you just heard it from vice president pence is on getting reelected and not necessarily on government and governing and getting more fiscal stimulus, which is a little bit confounding to me because obviously the stimulus that they have passed, the trillions of dollars, have helped this economy. this was a very good number for the trump camp today to get under that double digit unemployment, 8.4% unemployment rate is significant progress, but the biden campaign can say, look, there's still 11.5 million jobs that have been lost since this pandemic pre february and we are advocating for more fiscal stimulus to keep those americans afloat and to keep the spending, which is why i would think it would be in the president and in the party's interest, but clearly, you know, two months to the election the focus is on the election, carl, and it seems like it's going to be hard to bridge that divide, that fundamental philosophical divide here when it comes to getting americans more help that they may need. >> 60 days as we now know and

are going to start to count down in the days to come. kayla, i'm curious to know your read about his optimism regarding negotiations resuming on tuesday which once, again, sounds a little more bullish than we have heard certainly from leader mcconnell this week. >> well, it comes in advance of republicans unveiling this so-called skinny stimulus package early next week with just a handful of core bipartisan programs. and they are all the programs that the vice president just mentioned, the paycheck protection program, expanded unemployment insurance, some of these programs that both parties would not waste any time saying that they do not support so that is the republican position right now we have seen some burgeoning optimism throughout the week from mark meadows, the chief of staff when he appeared on cnbc earlier this week when he said his negotiations with democrats were going well although last night he said his conversations with rank and file democrats sort of in a jab to house speaker nancy pelosi but the

fact that there is at least an agreement between the administration and the house speaker to move forward and not shut down the government over stimulus at least sort of separates what could have been a potentially nuclear very toxic debate toward the end of the month injecting a lot of uncertainty into the economy so at least they have been able to get on the same page regarding that, but there is about $1.5 trillion of programs between what the republicans are going to announce early next week and what the democrats have said they would compromise on and those gaps haven't been filled in, carl. >> no. certainly not. as the chief of staff said to us earlier in the week. but what's a trillion dollars between friends, kayla we will watch that. nasdaq did go green for a couple minutes but back down and the s&p is in the red. let's get to rick santelli this morning. hey, rick. >> good morning, carl. we could talk about how much the data overperformed in terms of expectations, but the market is

having a say so here, especially the treasury market. as you look at an intraday of ten year and see how it spiked up, it really did have a bit of a say so in how to interpret some of the data points. as you look right now at ten year some of the data points. a 10-year note yields 67 your bonds are up 40 on the day, down 10 on the week, which is the point. we're seeing improvements, especially when the equity markets are trying to move to positive from yesterday. but we really are much lower, and that's due to some of the fed speak. realize we're all in this together in a way in terms of correlations, the 10-year boon looking like treasuries in response to an eight-year data look at 10s to 2s, moving back

up to 53, so whether you look at 10s and 2s, 5s to 30s, all of them steepened a little bit. that is a good thing ilts ni it's nice to see even if real interest rates are on the negative side, to see that pull from the long end pushing rates higher from that change perspective, you're also seeing a dollar that has been dramatically weak and many would have thought in january, but the dollar is popping. you see evidence on the euro dollar, by the way, the euro is down on the day and the week, and the yen is down on the day and the week as well carl, back to you. >> thank you so much we're going to continue to watch the ongoing weakness in some of these momentum names peloton down 4, tesla down 2 lulu lemon is down as well as the nasdaq is down another 1%. back in a moment

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luvs. parent like a pro. watching some of the continued weakness in momentum names, sara, it's going to remind people of the calls that were made in advance of yesterday's selling. i'm thinking of b of a downgrading to weaken. apple was worried about fundamentals until today today it's lululemon wayfair also downgraded to neutral. some comments about tough komps

in t -- comps in the future, and as citi set on lulu, can they buy at 400 in their words, they just can't do it. >> i thought it was notable, because over the last few weeks it's been analyst upgrades and chasing price targets, moving higher as themomentum in this market continues to go into some of those names here we are after yesterday's big selloff with two different analysts at two different firms downgrading two different highflying names, like lulu and wayfair. they admire and respect the strategy and boom in business that both wayfair and lulu have seen, but in citi's case against lulu, it's hard to say it's a $50 billion business similar call at wayfair. clearly bank of america found in their credit card data which

they were tracking that people are spending more money renovating their homes and buying new furnishings and that wayfair was a key, and that was a change in tone from the sell side i wonder if we'll see more of that now that we see stocks taking a breather here another one is docusign. they reported after the bell yesterday. hard to poke holes in that report everything came in better than expected, including the outlook. billing increasing in 60%. everybody is online. work is being done electronically signatures are obviously being done electronically. the stock is down almost 12% so here is the market saying 200% run-up, maybe that's already priced in, all these tremendous numbers the stellar report, as analysts are saying today which is interesting because a lot of analysts are raising their trades on docusign this is the key to the market.

this is what's happening all of a sudden we're taking a look at these sky high valuations and amazing run-ups in the stock prices, and even though some are justifying it, like in the case of docusign, maybe it's gone a little too far. >> goldman has some interesting buckets this morning, starara, stocks that are poised to do well if we get a vaccine but if you get a vaccine and reopening, does zoom deserve to be at 470 like it was yesterday? it's down another 7%, so investors are being asked to choose which future they believe is coming our way. we'll take a break here and we'll keep an eye on an early sswhh has signals that it could be as interesting as yesterday's. we're back in a moment aflac. these are all the cab rides to my physical therapy. and aflac paid me directly to help. aflac. what he said. and this unexpected bill is from...

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good friday morning, everybody. welcome to "squawk on the street." coming off the worst day of stocks since june and more selling, at least, on the nasdaq, coming in close to a 2% decline today. the dow gain was a 2.5 plus, whittled away to a 2 >> nasdaq down almost 2% now a road maps that will start with the jobs number. the economy adding nearly 1.4 million jobs in august the unemployment rate dropping to single digits a lot more than expected meantime, goldman sachs chief will join us he weighs in on what lies ahead for the millions of americans

still out of work. and finally, tesla's turbulent week down about 15% in just three days. a former board member will join us to explain why. so as we said, looking at some more selling and technology this morning sara, we were talking about some of the calls that sort of presaged the selling and momentum in the last couple of weeks. on the flip side were calls that actually presaged the bounce we're seeing in financials as we got deutsche bank and jp morgan on wednesday and thursday. those were the bright spots on today's trade. >> that's the question, whether the momentum can continue in some of the value names as the shine comes off of technology. we saw a little of buying yesterday in terms of rotation in energy and cruise lines they had just been losers for

the year that's what we saw and we continue to see today. with the dow remaining positive here, 86 points, we've been a little all over. the market is trying to figure out, i think, whether that jobs number is good enough or whether it breeds complacency from washington the wall street line of stimulus is we expect it to come. there is some agreement on extending some unemployment benefits, there is some agreement on extending a ppp program in helping small businesses and their employees there is a huge divide, obviously, on state and local governments which we heard vice president pence talking to kayla a few moments ago, but there is an expectation that would happen it's unclear if another jobs report would make it so it's less urgent. stocks took a tumble yesterday, but it's also unclear if that will be a prolonged destruction as we head to record highs we're only down 3.5% on the

record on the s&p. >> here's what the vice president said to kayla a few minutes ago. >> no one wants to give direct payments to american families more than president donald trump again. we sent those checks to american families, it helped people through this tough time, we want to continue the paycheck protection program, which we think laid a foundation for many of the americans that are coming off the sidelines going back to work we were able to preserve those job opportunities precisely because this president negotiated the paycheck protection program those are vital programs, we want them to continue, but what we've made clear is we're not going to allow democrats in congress to use a coronavirus relief bill to bail out poorly run democrat states in the country. >> all right, so that conversation, sara, is going to continue to a point at which there will be a very heated

debate about whether the recovery in the labor market is strong enough, as kayla asked, to the point where recovery is strong enough that further stimulus simply is not needed. >> kayla, the talking point that we just heard from pence on baling out poorly run democratic states i mean, they clearly wanted to make this a political point as they've had disagreements and very public fights with governors like andrew cuomo of new york, but the bottom line is the economics show that the states are in a deeper hole because of the coronavirus, they're not getting as much tax revenue, obviously, in, and there's some real job cuts on the line at these states and local governments. firefighters, teachers, and it's really a jobs story more so than a political story. so i wonder why the administration would not be focused on that if they're trying to get re-elected and it's going to mean a number of significant job losses if the states don't get help.

>> well, in this month's job report, sara, to be sure, there were more than 300,000 federal jobs added largely because of census workers, but there were 2,000 jobs lost in state governments, and while that's a small number, it does follow the trend that they don't have the ability to hire like the federal government does, and they're extremely cash strapped without having some of that revenue. there has been from the administration that the coronavirus was a blue state issue. while that view sort of reached its apex later on in the pandemic, it's true that while the south and the sunbelt went through their surges, their cities were still somewhat open. they were still able to make money while states like california were not. their states are bigger, their budgets are bigger, and the

states don't want to be in charge of plugging those that is the campaign message distilled. we tried to give you money and the democrats kept us from doing that, that donald trump wants to put more stimulus money in your pocket we should note that the skinny proposal expected to come out next week because of the most recent drop we saw does not include stimulus checks. perhaps that's something that gets hammered out at the negotiating table, but they've actually taken stimulus checks out of their bill despite the fact that the white house and the president specifically very much wants to do that. but it is clear, sara, that this jobs report gives some fuel to the white house and their argument that the recovery is continuing you heard the vice president talk about how even the federal reserve, this number is better than even what the fed projected for the end of this year, even though we still have a few months to go before the end of the year to make that claim. >> yeah. true and it is true it is better than a lot of

people expected. just looking at the dow hanging onto the gains, it's one of the major three still up crn, salesforce, apple, micro sofl soft, those are the losers if the tech does continue we are keeping an eye on the nasdaq it is moving south down toward 1% let's stick closer to the jobs number and the market reaction barron's chairman tom fink joins us now tom, what do you make of the selling in technology names we've seen now over the past two days how far does this go >> first of all, thanks for having me on, and clearly, yes, today, yes, we've seen a lot of selling in technology, and i don't think it anchors in one specific reason. sometimes you look at the fact that after a long run, and as you head into the end of the

quarter, people are going to take profits, especially after such a strong run. we're more focused at barron's really relative to what's the median and long-term impact of what we're going through with the pandemic and its economic effects at the end of the day. >> i'd love to hear the answer to that. i'm not sure anybody knows what the medium and long-term impact is going to be that we're going through as a result of the pandemic and the changes in the economy. what's your review at barron's how are you positioning? >> i think what you have to look at is for us we're not going in and out of markets we have to manage institutional money through the cycle. so a lot of what you have to look at is where is quality across fixed income, equity and real estate markets versus where we're going to see, frankly,

more concern we think the faults that have risen still have a ways to go. we have to think about those industries that may have permanent injury from the pandemic versus those markets that have had a good run because they've been helped by the pandemic, the change in some behavior, the change in some businesses you still have to focus on a lot of businesses that adjust their business models. as a result, you can look at these numbers we're seeing today, dramatic improvement in unemployment, an awfully big drop at the end of the year, but as we look forward to the next six, 12, 18 months, that improvement is unsustainable what's it going to look like as economies start to come back once we wrestle the virus, and you just have to focus on the fundamenta fundamentals >> the fundamentals is because the sharp selloff we saw yesterday across all the major

averages was repeatedly called a reckoning justification, but based on the continued selloff we're seeing in the nasdaq this morning is if the market still feels like there is justification needed for valuation. where do you see fair value for the nasdaq where will it go >> well, i'm not an equity expert per se, so i don't think i can give you a fair value of the nasdaq i look at it simply from a perspective of the valuations, the market was very, very high it makes people uncomfortable. how can you sustain such a high valuation when there's other noise ahead of you so where the bottom is, i think i'll leave that to the experts i just look at the fundamentals of what are companies doing? there are probably a lot of companies that weren't growth companies in the value space that actually are showing improved earnings that may catch a bid, if you will, at the latter part of the year.

>> and for at least one day only, we're seeing this sort of rotation out of tech into some of the more old line names like the banks, for instance. perhaps it's because it's late firming in rates, perhaps we're seeing things like criminal charges being dropped in malaysia against goldman sachs, but i'm wondering if you think that's a secular shift into some of those industries or if you think this is just a one-day special. >> well, i don't know if it's a one-day special, but i would look at this i'm investing in portfolio you want to be diversified across industries, you want to be diversified across the types of firms and for a long period of time, you have tech and other growth earnings really on a tear, maybe when you take some of those profits, which we might be seeing here, you're going to rebalance that portfolio you want to be diversified, you want to be in strong names like the large banks, for instance,

that over long cycles you're not going to lose a lot of money, they're sort of foundations to portfolios so some of this can ultimately be rebalancing to a more diversified posture. >> as far as global exposure, tom, i know you have offices everywhere around the world and your firm does a lot of business everywhere do you want to be in the u.s. versus europe? europe held up a lot better in terms of the market so far this week its virus numbers are rising again in places like spain i'm not sure if that's dictating the price action when you have the federal reserve with so much stimulus relative to other economies. how do you look at the relative value proposition right now for, say, u.s., europe and asia >> well, you want to be diversified in terms of the international exposure at the end of the day, it's still a global economy, and i think that whether you're looking at europe or you're

looking at asia, it's really about a point in time are you going to overweight certain geographies or underweight certain geographies. i do believe the u.s., even coming into the pandemic, was leaning toward some economic numbers, being exposed to europe, being exposed to the corporate markets in europe. even real estate, we've seen value in parts of real estate across europe. you know, you want to have that exposure for your global portfolio. that's what we seek to deliver our clients. they don't want to just be in one market at one point in time, they want diverse action with equity and markets like real estate >> all about the diversification. tom, thank you good to talk to you. tom finke from baring.

the nasdaq was holding onto gains here >> a closer look at momentum names that continue to see broad weakness this morning, dom chu hey, dom >> that metric we've seen for weeks now are rolling over a bit. what we saw yesterday is beginning to show slow momentum, as sara pointed out. stocks that are characterized as momentum based have really been outperforming as of late, except for the last couple of days. this etf, the one that tracks the momentum stocks in the u.s. is up 16%, versus a decline for low market and beta stocks we'll see if that convergence happens. remember, they traded pretty closely together before the

virus pandemic one place to watch as we take our funnel down to the next layer lower, check out these particular parts of the market overall within low volatility and within momentum. technology, the best-performing sector so far on a year-to-year basis has been hard hit. se semiconductors are now up 20%, but still, that rollover effect you're seeing. tech software, that's been another big part of the market cloud based goes in there as well they're still up 30% year to date then the stocks to watch the ones we have in terms of a work from home type theme. they've been outperformers to date, but look at zoom video still up 432% year to date, and we'll go to the work from home to kind of the beneficiaries of staying at home.

names like apple, amazon and netflix, a decline the last couple days, that downside continuing still apple up 50%, amazon up 75% and netflix 56% to the upside as well, so kayla, i guess the bottom line here is, the same stocks that have led on the way higher are the ones getting hit the hardest right now. it's continuing again today. we'll see if that trend plays out in the afternoon session remember, liquidity, the availability of stock trading, is at a premium ahead of a long weekend. we'll see if that gets exacerbated into the closing bell i'll send that back to you >> but the year to dates are still stunning dom, thank you we'll talk to the iechf economic adviser on today's jobs report that's coming up we're back in two.

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the last thing this economy needs is what joe biden and the democrats are advocating with high taxes, more exploration, the kind of energy policies that will stifle the american energy renaissance that i've seen in high relief in traveling across the country to places like pennsylvania and mexico and texas. this president's advanced policies that have laid a foundation for this great american comeback, joe biden and the democrats are advocating policies that would turn us back >> that was the vice president

mike pence answering a question about the 11.5 million americans who have lost jobs since the pandemic began our next guest is a former adviser to the biden campaign, former biden economist and chief economic adviser jared bernstein joins us jared, good to see you >> good to see you >> so "axios" reports that joe biden is looking at numbers off the bat. what do you think of that? >> first of all, i wouldn't count on those numbers we won't know until and if america is lucky enough for joe biden to win the election. but yes, we'll need a package because we will be far from full employment in january no matter what happens between now and

then we saw definitely a worthy decline in the unemployment rate today from 10.2 to 4.8%. we also saw a shift in employment that's problematic we also saw, and this may be more important, the acceleration and the pace of job gains. in may and june we were adding 4 million jobs per month in july and august -- i'm talking private sectors -- about 1.3 million. so a downshifting of two-thirds in jobs. >> so if we stay at this rate even acknowledging it's slowed in recent months, we would still have lost a net 7, 8 million jobs by the time you would expect the vice president to take office if he were elected but he has made no secret about wanting to raise taxes on americans who make more than $400,000 and remove a slew of what he believes are loopholes, but don't you think that raising taxes at a time so tenuous in the economic cycle would have a

detrimental effect how would that work? >> i don't think you can assume that to be the case, the detrimental effect, when you're talking about people who are not liquidity constrained so people with over 400,000. if you look at his capitalgain proposal to raise taxes on capital gains, that doesn't kick in until over a million dollars. we're not talking about people who are necessarily on a cutback spending that said, i do think it's important to be wary of the timing when you're talking about the times of paid-for agendas that biden is very committed to. he has a recovery agenda which really helps to kind of get back to this business of building a fiscal bridge to the other side of the crisis, something congress, senate republicans in particular, have dropped the ball on. but he also has this permanent building back better investment in clean energy, in child care, in helping to promote racial equity, in manufacturing jobs,

in onshoring jobs that have been lost that's his more permanent agenda and that will require pay-fors >> hi, jared, it's sara. i do feel like president trump, though, scores points on the economy. the market has shown a v-shaped recovery i know the market is not the economy, but there is a lot of optimism and there are sectors of this economy that are showing a v, like housing, like auto spending the jobs improvement is notable and it is strong, and when the president campaigns on lower taxes and fewer regulations, and when biden campaigns on higher taxes and more regulations, the president does get points for that growth story. >> there is a lot to unpack there. first of all, let us make no mistake. i started out applauding the climb in the unemployment rate today, but this is a recessio recessionary job market. unemployment rate at 8.4%,

that's a recessionary rate, so let's be clear about that. you're right, the stock market is not the economy over half of the stock market is held at the top 1% do you know what the bottom 50% of households hold, less than 7%, .7%. this may look like a v-shaped recovery for some groups, but for others it's more of a k shape. i guess the way i would put it, the stock market is up, and so is hunger and so are evictions and so are deep concerns about whether people will be able to make it through the other side of this crisis again, biden's recovery package, i think, is essential in that regard, not just on the economic front but also in controlling the virus which is the epic fail of the trump administration and i believe responsible for the acceleration in job loss

>> sorry, kayla, i'm just going to follow up, jared o th, on th question i hear from wall street about this growth picture is who biden would put in his administration, especially in charge of economic policies, like treasury secretary, and how influenced he is by the farther left, the more progressive part of the party which, you know, bernie sanders, elizabeth warren does not have the same views when it comes to regulating the economy and companies and growth as the more moderate members of the party, like you. and there is this question out there about the influences and who is going to pick up those jobs >> this is a great question for a cnbc audience. let me try to address it first of all, if you want to help a campaign, and for them to keep taking your phone calls, you don't directly answer questions like that, so you'll have to allow me to defer. i will say the following

i think that a biden administration is going to be a big plus for financial markets now, don't drop your coffee, anybody. the reason i say that is because a lot of the market participants that i've spoken to recognize the chaos and the just uncertainty that have been so deeply fermented by a trump economic situation by tweet, by a trade war that sent our farmers into recession before the pandemic crisis, and by a mismanagement of that crisis which is laying our economy low relative to every other advanced economy that handled this much better so it is not -- it is far from a slam-dunk that markets are as concerned about a biden administration as some of these questions make it sound. in fact, many of the participants i've spoken to are

looking very much forward to getting trump out of the markets. >> jared, to be fair, i mean, at the time of the trade war, the administration said that they could afford to do it at that moment because the economy was at full employment, the stock market was at record highs, so there was never a better time to go against america's biggest d adversa adversary. to be sure, now they are trying to pivot to help workers and small businesses, and one of the ways they're doing that is trying to allow employers to defer payroll taxes until next year and there are some hindering about how exactly this is going to go down, but i want to ask about vice president biden's views on this, because he said the other day that we could not afford to do this, that it would bankrupt things like social security, but he made a deal with mitch mcconnell in the last recession. so i want to know why it was okay to do then and it's not okay to do now >> let's work backwards because

i want to get to the trade question a little bit, too there is such a big difference between the payroll tax holiday back then and the one we're talking about now, and that big difference is this we paid for the lost revenue, trump does not not only does trump not pay for the revenue that's lost from his payroll tax executive order, you can't pay for it, by the way, because it's an executive order. you need congress for that, and we legislated that, something where biden comes way over trump in his willingness and ability to negotiate legislating. we paid for that not only is trump saying i'm not paying for this tax deferral, but we continue to not pay for tax deferrals. the trade war point, you raise a good point the time when that was most intense was a time when there was a much stronger economy than

we ever now. that to me isn't the question. the question is did the trade war help did it work? did it really reduce the trade deficit? was effective in our trade arguments with china, and to me the answer is conclusively no, and one piece of evidence, exhibit a, yesterday the trade deficit hit a 12-year high trump campaigned on reducing the trade deficit. his trade war was supposed to fix that, and in fact, the opposite has occurred. >> well, i wish that we could debate the trade war, the impact of that and the timing of that, but we are out of time for now jared, we're going to have a lot of conversations between now and the election, and we certainly appreciate your time >> look forward to it. thank you. >> that's biden adviser jared bernstein, sara. time now for our etf spotlight. kayla, we're taking a look at the iyh shares up 5% year to date erased earlier gains from

today's recession. one of its holdings, johnson & johnson also off the highs for the morning. the company reports that its vaccine does show illness in hamsters and has a few side effect they're testing their vaccine later this month it would be the largest testing of this vaccine yet. we wait for trial results from astrazene astrazeneca, moderna we'll take a commercial break. stay with us at "squawk on the street." the tech numbers down now about 3% energy remains higher but most of the averages all lower. we'll be right back.

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hello, everyone, welcome back i'm sue herera here is your cnbc update at this hour a suspect appeared to admit to shooting a man who was part of a trump caravan in portland was himself killed when law enforcement officers tried to arrest him officials said michael reinhold pulled a gun during that encounter. protesters protested the death of prude in a faceoff with police seven police officers were suspended with their involvement in prude's death rescuers are racing to find

a possible survivor in the rubble of basically a full month now after that massive explosion in the city's port the search area has been narrowed down to an area of about san francisco fe16 feet b much of the work done by hand. we'll keep our eye on that because it's still a developing story. carl, back to you. >> the selling continues this morning. the nasdaq down 3to 300 points. we'll talk to jan hatzius about the jobs loss in a moment. ♪ ♪ i keep working my way back to you, babe ♪

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1.37 million jobs added to the economy, much better than expectations let's bring in chief economist jan hatzius and what the futures may tell us.

happy friday, jan. good to see you. >> thank you, good to be here. >> safe to say your reaction is pretty constructive given what you see is a high likelihood of future gains going to the end of the year >> it was much stronger than expected, a 1.8% drop in the unemployment rate is large, and even after that drop, 45% of all unemployed workers are still on temporary layoff and over the last few months, that temporary layoff percentage has been extremely high, even higher than this, and these are unprecedented numbers. it's been a pretty good predictor of strong job gains. so we do expect further significant declines as the economy continues to grow quickly. it's no longer growing as quickly as very early on in the recovery, in may or june, but it's still rapid >> you write that the 6 million

workers still on temporary layoff suggests scope for additional large gains later this year if public health circumstances allow. earlier in the week, i think you worked on a report that argued or asked the question, is this it in terms of reopening in certain states regarding the economy. are you worried that perhaps we are starting to flatten out on the pace of reopening, and what does that mean for your jobs forecast >> well, we did flatten out several weeks ago, and we've seen, you know, more of a sideways move in some sectors that basically, becau because o pandemic and continued restrictions, but there are also other sectors of the economy that are still growing very rapidly, and we really have seen, to a significant degree, a v-shaped recovery already. manufacturing is one, you saw the eisen number earlier in the

week, that was very strong, and construction is very strong as well there are still room for gains and the construction activity hasn't caught up with that there are definitely risks i don't want to minimize that. the pandemic is clearly one, the fiscal issues are another, but there is a lot of spring in the recovery also in other sectors that i think is probably going to continue. >> jan, it's sara. i feel like economists like you have a tough job right now how can you possibly forecast where growth and where jobs are going to be by the end of the year when we don't know whether there is going to be a stimulus package, we don't know whether there's going to be a vaccine and whether people are going to take that vaccine in large numbers, we don't know the shape of the virus curve and what's going to happen into flu season. these are all huge unknowns in the last quarter of the year, which will determine the direction of the economy how do you make an outlook

>> no question that the uncertainty is greater than normal, much greater than normal i think that's true for most forecasters. if you look at the federal reserve minutes, the fed staff always gives an assessment of uncertainty relative to normal it's extremely elevated, and i think the factors, as you note, are some of the key drivers. and i think numerical uncertainty is off the charts relative to history. directionally, though, i think the reasons for why we're likely to continue to come in above consensus expectations and why forecast provisions are likely to be upwards, including, i think, in the fed's projections that are due in a couple of weeks, i think those arguments are quite strong, even recognizing the significant amount of uncertainty. >> you know, jan, the fed has had the most sobering projections of this uncertainty for the last several months, but

as the vice president pointed out, the unemployment rate that we saw just this month is better than what the fed expected for the end of this year so do you think that given some of the better than expected data that it would cause the fed to change its position or change its outlook or its actions slightly >> almost certainly as far as the forecasts are concerned, the median projection for the unemployment rate for the end of the year is 9.3% and renard 3.4, so it has to come down substantially. i think the median there is fourth quarter to fourth quarter. that also looks too low in my view i think where the policy concerns are, though, i would expect doubling from the fed the framework review that we got last week said that they're much less likely to extrapolate inflation from the behavior of

unemployment, skpand inflation s still far below the target, so i think they'll tell us for now and for a long time to come, we'll still see very easy monetary policy. our forecast is that we don't see a hike in the funds raised until something like early 2025. obviously there is a lot of uncertainty around that because of all this uncertainty around the economic outlook, but i am confident that it's going to take a long time, whatever the precise liftoff date is. >> jan, thanks what a report and what a set of questions that everybody has to ask themselves in the coming weeks. i look guard forward to our next thanks have a good weekend. >> thank you, you, too it's the worst two days for the nasdaq since mid-march now we've lost nasdaq 11k, lost s&p

3200 now to meg tirrell hey, meg >> so much is being looked at with the speed of the vaccines, moderna saying theirs could be rea r ready by the end of july moderna has updated their numbers and expected to update them at the end of today they have gotten in 3500 people, so they are moving quicker we've seen from the data the black community faces not just a greater risk of getting covid-19 but having more severe disease when they do get covid-19.

moderna says it's telling cli clinical trial sites that have not enrolled enough in these communities to do better they could see a slight delay from this, maybe about a week, so not a huge delay but they are slowing down in order to make sure they have representation from these communities, which is so important for if and when these vaccines become available. building trust among the communities who will be most prioritized to receive them because they're at highest risk of the disease guys, back over to you >> meg, pretty interesting are any of these trials enrolling kids in the vaccine clinical studies because eventually we would want our kids to be vaccinated as well, right, to go back to school >> yeah, that's a really important question, and right now these trials are just being run in those over 18 it's an interesting question, because we think about flu vaccines, and as soon as your baby is six months old, you're encouraged to get their flu

shot, and for covid we're not going to have that data right away so it will be a delay before when kids are vaccinated, most likely the companies do have plans at some point to enroll children in the trials, but the initial data are going to be in adults. so that will come later, sara. >> meg, what is the impact of so many trials being run at the same time? i mean, there is only a limited population of people who would qualify or perhaps be interested in participating, and so you do wonder if we get to a point where you're going to run out of people raising their hands is that an issue >> potentially so many people have expressed interest in participating in these trials, but one of the challenges, and that's what we're seeing from moderna today, is making sure that the people enrolled in the trials are those that actually face the risk of getting the disease at the highest levels people who actually have to go out into the community to do their jobs a lot of folks who might be

interested in a vaccine trial are the folks who have the privilege of being able to work from home and therefore they are not exposed to covid-19 as much. if you enroll a bunch of people like that in these trials, you might never get these results in terms of seeing if the vaccine is actually protective so with all these trials rolling at the same time, you're totally right that there is a population of folks who -- basically there is a competition to enroll in the trials, and there's almost a competition at clinical trial sites among the companies, too, to be able to work with different hospitals and doctors to enroll folks. it's this unprecedented situation, and it's really interesting to see play out. >> we're lucky to have you covering it. megging t intirrell, keep us up it continues to roll out here. we'll take a look at what's putting the brakes on one of the

hottest stocks that's next. stay tuned

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worst two-day stretch since the middle of march, and the ndx came about 100 points away from touching the 50-day moving average, something it's not done since april. we're back in a moment for a strategy gut check? what's that? you run it by an expert, you talk about the risk and potential profit and loss. could've used that before i hired my interior decorator. voila! maybe a couple throw pillows would help. get a strategy gut check from our trade desk. ♪ t-mobile's new offer on iphone 11 pro is even better on our most powerful signal.

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tesla shares are down nearly 25% since hitting a record interday high just on tuesday. which i guess makes it technically in a bear market, it is still up 360% year to date. steve wesley joins us now on what is next why is it down so much why did it go up 760% in the

last 12 months did anything change with the tesla story in the last week here are some of the big questions, are some of the major shareholders, fidelity, van guard going to stampede to the door, or will elon musk step up. it is a fascinating drama, better man most movie scripts. >> we get your point, steve. you were on the board of directors on this company and you have pretty unique insight it has really captured the

imagination of investors and it is one of the reasons they have flown past other auto maker automations. what can you tell us about musk and that vision? and if the outsized gains are worth it >> i have been a champion of tesla and tesla stock. do i think they warrant the share price, probably not it could go down further. he has created one of the most powerful brands in the world since apple. third he has continued to innovate faster than anyone else that is why i think there is still a lot of huge believers for the company. they're bringing two huge new products to the market the semi and cyber truck

the tesla behind it. battery day is around the corner i think the long term bulls on the company are thinking and he may just blow things away. >> all of that requires an immense amount of capital and elon musk has disclosed the opportunity. to what degree are people right to start worrying, and when will they need it in a more sdpras

way than they led on before. >> things looked dicier. this is a whole new world. he has moved the global auto industry to being electric the ability to raise money at this valuation who wouldn't this is the last company likely to have a cash crunch. you ought to be asking about ford, gm, chrysler, and fiat one of the interesting things is tesla is so far ahead of the electric power train that other may j major automakers talking to

them, and he may help them move into the world of electric vehicl vehicles i i ing. adding insult to injury, musk talking about building in germany this week. we're still down across the market in some of the year's biggest laggards take a look at simon property, regency centers, vornado, a lot of names in the realm of 1.5% to 4% many stocks down more than 20% in 2020, but nice green for one day of trades. "squawk on the street" is back in a moment.

good friday morning. it is 8:00 a.m. in coopertino and "squawk alley" is live ♪ good friday morning, welcome in on this friday mornin