wechat avoiding bans for now but we'll take you to beijing for an update on china's blacklist that could impact some american companies. president trump says he will nominate a woman this week to replace justice ruth bader ginsburg we'll cut through the rhetoric and tell you what the high court changes could mean for your money. monday, september 21st, 2020 and squawk box begins right now. fls flshl. good morning, everybody and welcome to squawk box on cnbc. if you're just waking up this morning you better play pretty close attention to what's happening in the markets check out the u.s. equity f futures at this hour dow futures are down by 482 points and that's off the worst levels we have seen earlier this

morning. and the nasdaq is down by 182 points a lot of this is what's happening in europe right now. you don't just look at the oversees market but we're going to take our queues from what is happening there. you can see the ftse down by 3.4% and the other markets are down by more and a lot of this is coming in the last few hours. they could be considering a second lock down as covid cases there have soared they're back to the levels in may. they're concerned about what's happening with the number of cases and the hospitalizations admissions doubling every 8 days they're now looking at 6,000 cases a day and again there's been some talk of a potential second lock down there now they want to make sure that schools can stay open and that some businesses could stay open but just the threat of that, the potential for the second wave coming is enough to push all of the stocks in europe into the

red. if you take a look at what's been happening with travel and leisure stocks they were down by 6% earlier in the u.k. and some of the stocks trading here this morning, carnival corporation down by now 6% you can see royal caribbean down by 4.7% and then other pressure coming on southwest airlines and norwegian cruise lines and wynn resorts. there's been some concern about the bank stocks and financials under pressure this morning as well. >> there has been and it's nice to see you we have been watching bank stocks this morning after a troef trove of confidential bank documents. large banks moving massive amounts of funds over a period of 20 years. this despite red flags over the origins in the money hsbc, jp morgan chase, deutsche

bank also on that list and standard chartered and bank of new york melon but bank stocks are down across the board this morning. you can take more away from what's happening in europe in terms of what the stock movement is today more than the report over the weekend meantime, the other big developing story over the weekend, president trump agreed in concept to a deal where tick to be will partner with oracle and walmart to become a u.s. based company delaying the ban that was supposed to go into effect last night. it would own an 80% stake in the company sort of and we'll try to break some of this down in a minute tiktok tweeting out this message, we are tiktok and we aren't going anywhere. i don't know how much time you spent looking through this but

it's fascinating to try to understand what exactly this particular transaction means it doesn't very much look like i don't think what the administration said they were looking for which was a full sale it looks like what i just said byte dance would own 20% of it at the same time, the way they're fireworks notwithstandi -- they're using some of the language, it could be others that are currently owning part of byte dance, they will be issued shares in this new company and the argument ultimately is that if you recount those shares, plus the walmart-oracle shares that they collectively would have the majority over byte dance. >> plus the ipo. but you're getting into percentages of percentages i'm going to take your word for it that if you do the math it's

53%. we switches seats again. i if any place would really love this deal, it's france because it is statist, it's picking winners and losers larry ellison is a campaign contributor and it's rewarding companies that you like and it's the perfect sort of government statism. i was going to have to download tik tok. it was going to be my last chance it's supposedly as good as facebook. >> i never downloaded it and i wasn't in a rush to do it

yesterday either. >> lip syncing and dancing. the most interesting thing is not this particular transaction that i know it had so much focus on itself is that a number of chinese media which invariably when you see the chinese media come out, the

expectation is that it's suggested by the government. the expectation is that the fang companies should be regulated the same way byte dance is being regulated around the world so that in every location it should be run by effectively a local partner. but it's the beginning of what a lot of people may be worried about which is what may be a backlash related to trading. i know people think this is very stattish. >> i would say from the respect of where the local servers are kept, in china, that's long been an issue they wanted servers keptlocall so they would have control and access to the information. adding that additional layer of saying it has to be run by a

local partner, it doesn't seem like a huge stretch from what many of the technology companies already agreed to do to be willing to operate in china. you know, he is pretty good at finding solutions. out of all the people in the administration you said that before i mean, this is truly threading the needle to get this done and maybe it's going to happen somehow but it's like, i mean, it really is convoluted. the 52%, the ipo the servers are here it goes back there you know, i don't know >> here's my other question, maybe -- >> go ahead. >> maybe you answered this last week but having missed out on some of what is happening, is this solution acceptable to the chinese because for a long time china was saying forget it, we'd rather see it just go under and

close shop than be owned in whole by a u.s. company. is this sort of threading the needle >> it is. >> but they're going to try -- >> it is. >> retribution probably and other areas. >> they didn't have to give up much and they have been able to maintain the value of the company. if you're the founder of byte dance you'll make a lot more money from this deal relative to what microsoft was proposing so from a -- just straight financial perspective. so you can look at this -- critics of this deal would look and say if china is willing to accept this this is not such a great -- this is not such a great deal. >> people are supposed to be

unhappy on both sides for it to be a good deal and then this education. >> i'm confused about that as well >> we're going to move on but did we get stiffed again last night? i show "schitt's creek" won a lot last night you can never just say the name of the creek without saying the creek, if you don't say schitt's creek you're up schitt's creek jimmy kimmel kept saying it over and over and cbs at the bottom had to always put it, but it won -- what's wrong with you it won a lot but we again -- i don't even think we got a mention? did you even hear the word squawk box >> squawk box. >> the news emmys are on a different day, joe >> they're separate.

>> we have to move on. that was 30 seconds. we have to move on you go ahead andrew. that's way too much fun. >> let's talk about the other issue of the weekend which has to do with wechat related to tiktok because there's a larger question about the role of the administration in these very decisions and whether they should be the ones making these decisions almost ad hoc on their own and that's where a u.s. judge came down halting the trump administration's ban on downloads of wechat. the move blocking the commerce department from forcing apple and google from removing wechat from their stores. the users that filed a lawsuit to blocked the ban raised serious questions about first amendment claims shares of parent company ten cent were down 1.6% in hong kong overnight but there's a larger

question to be asked about the role of this administration which is to say typically when transactions get done, they're not negotiated by the president of the united states or the treasury department or what have you. we hisstorically haven't had that we had systems in place that are supposed to actually prevent that kind of thing from happening. >> let's have more on this from eunice because she can tell us about what we're eluding to. we just heard about tiktok and we chat and now an update on china's blacklist. how does this all fit into this. >> yeah, well, i thought i'd weigh you in a little bit more on what you're talking about with byte dance. we were trying to get some verification about that 53%. they would not verify it at all but they just reiterated their position which is that byte dance will have 80% of tiktok global shares. so the company had put out a

statement to try to clarify what they described as rumors and i think also perhaps to market to the chinese public that this was a good deal because one of the points was that byte dance would have a great share of the ownership. that the algorithm and that the technology was going to stay in chinese hands. that the tax payment or the key money of $5 billion wasn't actually key money instead they said that this was taxes that would accrue over a number of years and they also made a point in the chinese public to say that the idea that they would fund education in the united states was something that was totally new to them. they hadn't actually heard that part even though they're committed to education. the way they have seen this deal is that it is positive for byte

dance. that it's positive for the chinese government picking up on andrew, what you had said in state media, everything has not been giving credit to the founder. instead of giving credit to the chinese government and today there's a piece saying that the approval was because of the chinese government and holding this up as a model and a mechanism that can be used for a lot of i.t. companies where there's a data security issue and a model that can be used around the world and there's been plenty of stories about how comparing the tiktok deal to the way apple is forced as well as other u.s. companies are forced to work with a local company especially when it comes today at a storage because of national ecurity.

>> all right did you know that it was going to be about a lip syncing app. but we are just agonizing ver. state media has been throwing out apple and fedex as possible targets for this unreliable entity list that china has but i think what is also interesting there is that there's a lot of talk but so far, no action because the chinese government also knows that if it were to clamp down on some of the american companies that really does effect their jobs picture and they are very concerned

about that and how it relates to the economy. >> eunice, that was going to be my question on that. the reason that they may not want to name companies, particularly somebody like an apple, that's a huge part of the jobs picture is that the entire issue that you think is protecting any of those companies right now? and the disruption and uncertainty that that would bring to the economy is the reason why the chinese have been holding off. i mean, i talked to a lot of different people that said the way the chinese government would be doing this is like drawing up a list of american companies and seeing which ones have a replacement that would be

suitable and we don't know who is on that list. so sometimes i think it's just to scare people and to get the u.s. business community to put more pressure on companies >> all right thank you. eunice finally we're not -- we're going to take a much needed break, i think. i'm exhausted. exhausted. after 17 minutes. >> 16 minutes in 17 minutes in. hey, the one thing i would say is that seems to be the issue that is kind of universal for every government looking at this the trump administration pointing out that they think this tiktok deal will lead to -- what was the number they used? 25,000 jobs. that's the only time that you hear any of the rhetoric start to die down a little bit in terms of saying we're going to punish them. well, if it means there's going to be jobs at home, that's the only time you ever hear them back down. >> yeah. somebody else invented a social

media company, yay someone besides us. >> it's very hard. i'll just make a point it's very hard to believe they'll ever see 25,000 jobs in the united states from tiktok. >> come on come on, be positive. >> do you remember when president trump stood with the ceo of foxcon in wisconsin. >> you can't just be -- let's be half full today. half full. >> count how many people work at facebook and then call me and tell me that you can get 25 -- when the algorithm is being made by engineers in china. >> i thought you liked croni capitalism or was that me? >> that was you. >> never mind, so i like it. >> all right, guys, news breaking overnight that nikola's founder is stepping down as executive chairman that stock is down it's plunging down 28% this morning. this is only about a week and a half after gm bought an 11% stake in the company

we'll tell you what is behind the move and show you gm shares as well when we come back. right now as we head to a break, take a look at the u.s. equity futures. this is what we're paying attention to very closely this morning. the dow futures down 520 points. s&p futures off and the nasdaq is down by 190 declines by 3.4% for the u.k. market right now that's coming as the u.k. is saying it's seeing an increase in covid cases and we'll talk more about that in a little bit too. concerns about a second wave is probably a big part of the reason that you're seeing the sell off this morning. ♪ you can go your own way

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welcome back the breaking news just doesn't end. this is additional news breaking overnight. the founder of company nikola is voluntarily stepping down and giving up his board seat this move comes after short seller accused him of making false statements in order to cry to grow and secure partnership with auto makers he says that milton agreed to relinquish 4.9 million that had been granted to him in august. it's down by 29.5% this morning.

and he intends to defend himself against false allegations leveled by outside atractors he has been appointed chairman effective immediately. took an 11% stake in the company and check out gm shares which by the way were up pretty significantly on the news that it had taken the stake in nikola they're down by about 3.8% this morning. >> we'll see what comes out. they are making it about the company. either they have a proprietary

technology or not. we'll see what finally comes out. he was worth a billion dollars i don't know if he's below that at this point. i might get out of there too especially if some of it has been hyped a little. i think phil, we need to talk to phil and diamler and others are pretty well healed that are, you know, this is not tesla. if you paint it -- or maybe it is but they portray it like, you know, they have a barrier to entry like tesla has for some other places but i don't know it's the beginning of the beginning and then we had mary bara on. >> i wonder whether his leaving has something to do with gm being up happy about the situation and the fact that he helped put that deal together and is now running the company. >> right. >> yeah.

>> all right if you just -- >> i would agree 100% yeah. >> all right if you're just waking up this morning, you really missed some unbelievable stuff at the top of the show before we were told to stop. and last month on technology, everything happened. august 22nd. >> go into cyclicals and industrials and you don't think that it's too late to do that. >> no, actually, if you think about what's happened since early september that's before the overnight sell off

that's been dominated by the consumer discretionary perspective. amazon information technology and communication services so it's really been that the mega cap winner take most companies that have taken the market down, industrials, materials, and financials are flat during that time period. there's all sorts of risks i didn't expect it to be about tiktok or wechat. >> that's what i love and then i said, did you hear the one about the ceiling? do they not get any -- it's over their head anyway -- >> early morning, joe. >> i guess it is i guess it is. i shouldn't even try do you think this has run it's course i don't think you do, do you >> well, not for the technology sector itself necessarily because if you look at what's behind all of this, the data has

been getting considerably better so i listen to your show and brian's show for awhile as well and i get one of the two numbers that i really liked overnight. one was the korean export numbers that went from negative territory to positive territory for the first time since the covid recovery and those were much stronger than respected so if you recall we had weak global trade activity because of the trump trade war. that was beginning to rebound before the covid pandemic hit. we got very low global inventories. you got the makings of the very strong rebound we get the flash pmi for september this week. more of the regional fed manufacturing surveys showing a pick up in capital spending related plans. so i think that you have the makings of a decent strong recovery even the inflation measures. part of what i wrote about this weekend was called recovery and

reinflation because prices were starting to head up as well so to me, the economic recovery is gaining momentum and that's behind why the other sectors are doing well and some of the work from home stuff is starting to sprawl out. >> yeah. >> i would definitely be a buyer of those cyclical sectors. you want to buy s&p down 9.5% and it's a good spot as well but i would be buying recovery beneficiaries into this weakness. >> the journal has your south korean numbers as well as positive stuff out of germany and it's kind of surprising. global trade bouncing back much more quickly than in '08 because it was an artificial shutdown and you shut it down and there weren't systemic underlying problems.

and it's still different and i don't think we knew that this is kind of surprising, isn't it i am in the deglobalization camp and i'm going to restructure global supply chains that have gotten way too stretched the stories about the boeing 787 are case in point that was signaling global supply chain mess but this deglobalization trend is going to persist throughout the decade but the fact is that global trade is really weak in 2018 and 19 and then the pandemic really caused him to get hit and a very persistent sharp rebound that's going to catch a lot of people off guard. >> we have to end it there like the backdrop. i hope that you have a great

snow this year out there we have to get started now to get that going. >> we had a little bit of two weeks ago. >> two weeks ago >> thanks, andrew. >> colorado had a lot of snow just two weeks ago coming up, bill gates out with a new warning about covid testing in america we'll talk about it right after the break as we head to that break. take a look at the biggest premarket decliners in the s&p 500. we'rba aerhi the lexus es. every curve, every innovation, every feeling. a product of mastery. lease the 2020 es 350 for $359 a month for 36 months. experience amazing at your lexus dealer. experience amazing clean i♪ a feeling. it's the satisfaction of upgrading to a bidet seat, just like that. and the simple joy of washing your hands, without ever touching a faucet.

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we got a new warning this morning from bill gates speaking on fox over the weekend. he says access to fast testing is still inadequateme and he called it outrageous that people can't get their results in 24 hours and this remains one of the great problems with keeping track and chasing this virus and hopefully keep it at bay meantime, a lot more coming up on squawk box this morning when we return, we'll talk more about this global market sell off happening as we speak.

let's show you where things stand. dow looking to open down close to 450 points right now. s&p 500 off 41 points. all off of what's happening in europe right now as covid cases spread there and there's questions about a potential lock down in the u.k. mohammed el-erian is going to weigh in next. back in a moment as business moves forward, we're all changing the way things get done. like how we redefine collaboration... how we come up with new ways to serve our customers... and deliver our products. but no matter how things change, one thing never will... you can rely on the people and the network of at&t... to help keep your business connected.

good morning, welcome back to squawk box. we are watching the u.s. equity futures this morning and there's substantial red arrows this morning. the dow futures down by 444 points and it's a decline of 1.46%. the nasdaq is down by 133 and these are off the worst levels that we have seen this morning we saw the dow down by 550 points at one point earlier this morning. this is all copying what we're seeing in europe in fact, the declines are quite a bit more substantial take a look at what you're seeing right now in the u.k., the ftse is down by 3.3% the cac is down by 3.2% and in italy downby 3.1%. this is all coming as news out of the u.k. suggests there could be a potential for a second lock down coming. rising to the worst levels they have seen since may and that's having a big impact on what's happening with travel and

leisure stocks leading the way lower this morning it's good to see you. >> good to see you too becky. >> what are you hearing this morning. there's a lot of news out there. the financials are under pressure because ofconcerns about potential for money laundering taking place for long time but really the travel and lez sure stocks are seeing the most significant declines this morning what are you hearing in terms of the covid cases there. what do you think it means longer term for the market. >> there's two very different dynamics going on. and it has to do with liquidity support and on the first one what's happening here is put very simply, infections are going up but more importantly, the testing process is getting

overwhelmed and we're entering the fall and winter and imagine the following, you get the normal increase in colds and flus, people cannot distinguish between what is normal cold and flu and what is cov irgs id so they become very cautious the only way to sort it out is to go test the testing system gets overwhelmed and then you start talking about increased restrictions and that's why it's having such an impact on the market because people realize that as we enter fall and winter, living with covid which is our reality and we get a vaccine or heard immunity, it becomes much trickier. >> living with covid and the testing systems, i had heard the testing was being strained what's the problem testing has been constrained in

a will the of different places but what is the major hold up and can it be fixed? can there be more tests that get brought up very quickly? >> i don't know enough about it but you have two views one is the demand has overwhelmed supply it's a modeling issue. people underestimate it. the amount of people wanting to be tested but there's another issue which is actually the way that it's being implemented is also problematic the reality is that this testing issue is going to be with us and it's really complicated but unless you test people are going to be cautious and the more cautious people are going to be, the less dynamic the economy is going to be and the weaker the fundamentals and it's trying to clarify what was said last wednesday at the

press statement. >> and by clarifying that you think it will sure up liquidity? >> so the hope that they would have is that they will reinsert this very strong conditioning that you can forget about fundamentals markets because we have you covered we will continue to provide ample and liquidity but for that they need forward guidance not only on interest rates that they provided but forward guidance on what is really important for these market asset purchases that's what they did not provide last wednesday >> hey can we go back to the banks? we were flashing those financial stocks and the european banks. they have come under more pressure this morning.

these banks, the stories that we have been following, all of these reports are out there saying that they looked through a lot of the filings, the suspicious activity reports that the banks have filed and basically say that banks have known that there was the potential for money laundering taking place and they filed all of the reports and they got ahold of the reports and say the banks should have been doing more to prevent money laundering hsbc down by 5.8%. those are pretty significant declines. >> you had a perfect storm for banks. low interest rates, higher credit risk and if you had a card business less activity. now, renewed concern about regulatory and supervisory issues.

if you put a question mark over wealth management it's another head wind. so it's really the perfect storm for banks right now. >> what does this mean in terms of the broader implications for the markets if thefinancials are weak at this point if they can't step in as much. the market is looking for this to be a healthy correction as opposed to something less constructive it's for the hand off to occur for the rally and if you put a question mark over one of the sectors it just means it's a tougher road ahead but what

everybody wants is they want the rally to continue but be a lot broader than what we have seen so far. >> is it surprising to see the ones that came up so much be the ones that give back? >> no, because we need to come up a lot and they did have positive spill over. those that buy, this is a healthy correction and pull back i'm saying that that's a good sign because leadership was being transferred from those who outperformed to the lagers and you provide more of a basis.

i worried that for a long time we have been powered by liquidity. by technicals, by liquidity conditions we had a couple of fundamentals a long time ago so fundamentals would not get them to catch up and you're seeing this on the banks today, it's going to be this falling in love again with the liquidity conditioning that's what you need if you're buying into this market at this stage. and that is all that a conditioning issue the markets should have gone up and stayed up and being more dovish in it's guidance than people expected. >> we'll talk to you again soon. >> thank you. >> coming up, apple sliding sharply last week and being hit hard this morning, in today's

sell off we'll talk to one analyst that says the stock still has plenty of room to run and i assume he means run up and not room down. we'll talk to rick scott for the lastut ote of washington on the tiktok deal. squawk box coming right back everyone wakes up every morning to a world that must keep turning. moving. going. the world can't stop, so neither can we. because the things we make, help make the world go round. we are builders, constantly creating things that make our world cleaner, healthier, and more connected. so that the small moments that help define who we are, and the big plans that make life wonderful can keep on rolling. because while gravity may keep our planet on its axis,

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welcome back to squawk box this morning we are in the red and the dow closing in on potentially being off more than 500 points this morning. nasdaq looking to open up about 150 points also the s&p 500 looking to open down about 45 points programming note, we're all getting ready for delivering alpha. it's taking place next week. it is back for its tenth year. a very special anniversary with very special guest morgan stanley's carla harris

and those that want to go. you can do it all virtually this year of course learn more and register for all of it. when we come back on the other side of the break, tech stocks have tumbled since the start of september putting apple down nearly 20% since september 1st going to talk to an analyst about what to expect from shares of apple and of course the decisions on wechat and ticktock tok and what those decisions mean some see a grilled cheese sandwich and ask, "why?" i see a new kitchen with a grill and ask, "why not?" i really need to start adding "less to cart" and "more to savings." sitting on this couch so long made me want to make some changes... starting with this couch. yeah, i need a house with a different view.

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welcome back to "squawk box. apple hit hard coming after the unveiling of several new products last week, including a new watch in the subscription bundle the stock is off more than 22% for the year high. i'm not going to get into what's going on but i hope you can help put it in context. we had the product launches last week we have antitrust lawsuits that are hanging potentially, we'll see, over this company given what's happening with epic games, and now you have tiktok and wechat and whether there's a

backlash in china. how much of all of that is playing into the stock right now? >> that's a good question. thanks for having me, andrew good morning you're seeing natural consolidation given what have been frenzied action in the stock following what have been stellar q3 results and the stock split announcement the split drove excitement in front of that fact which occurred at the end of august. effectively, you've seen pull back longer term all of the ecosystem benefits are in place. to your point, sure, there's been a combination of other factors that have probably contributed to some of the weakness as well >> and specifically though, of all of those various potential clouds i threw out there, which one are you concerned about or are you concerned about any of them >> i think longer term we've got to watch antitrust to understand what happens they've taken a pretty strong

line versus fortnite they've navigated some of those issues whether it was netflix in the past, fortnite that's something we'll have to keep an eye on at the end of the day there's a sim ymbiotic relationship betwe developers and the platform. that's why it's good to keep an eye on tiktok and wechat the more access you have to apps, the better the ecosystem flourishes >> right what's a fair price for this company right now? >> well, we've put $133 target price on it. i think this is a stock that can -- obviously is trading above the market we think right now this is a beneficiary. you should get a premium from that in the market case in point, my home broadband is down, i'm using my iphone and air pods to communicate with you all this morning that's what you need to work, right? i think our sense is that

they're going to get a nice boost again from this latest product cycle because these products have become more indispensable than ever. i think the stock will get back up above 130 >> how much of that, though, do you think is a pull forward? i've talked about this on the show we've ended up for our family, beneficial or privileged to be able to do it, we're buying ipads, buying laptops, buying a lot of stuff, stuff we might have bought a year or two from now. the question is whether that's pulled it forward. >> well, there's probably some pull forward i think the products are becoming more indispensable over time we had the most recent consumer survey weeks ago the purchase for the next watch was almost double what we saw in the survey even some of the wearables which is north of 20%, you're seeing increased demand that's helping supplement iphone iphone, i think we're due for a

bigger upgrade cycle you've got big portion of consumers out there that have had iphones for three plus years. >> will, we appreciate it very, very much. look forward to talking to you again soon thanks becky? >> thanks, andrew. when we come back, senator rick scott will join us talking about the tiktok deal that was struck over the weekend and the battle brewing to replace justice ginsberg right now though as we remain in the red this morning, take a look at the pre-market laggards in the dow dow down 170 points. j.p. morgan chase down 170%. dow down 2.6%. we'll be right back. stock slices.

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anncr: give customers access to precisely what they want, when they need it the most. with adyen, the payments platform that delivers convenience for all. adyen. business. not boundaries. a champion of justice lost the passing of supreme court's ruth bader ginsberg sparking a political fight in washington. tiktok is here to stay for now. president trump agreeing in concept to a deal to make the app a u.s.-based company we will have the latest details straight ahead. markets on edge as the future of the supreme court and additional stimulus are now in

flux the latest on what to expect in today's trading session coming up as the second hour of "squawk box" begins right now. good mornings and welcome to "squawk box" right here on cnbc. i'm andrew ross sorkin along with becky quick and joe kernen. i want to show you the markets right now because we have them moving lower we're in the red we can fairly say this is a market selloff taking place this morning. keying off of what's been taking place in europe. dow off 453 points right about now. the s&p 500 looking to open down 44 points. we have the nasdaq looking to open off 143 points in large part over concerns about covid cases growing in europe, specifically in the u.k. and whether there will be additional shutdowns. joe? >> thanks, andrew.

bytedance for its part says it will not give up control of tiktok in the u.s. oracle and walmart will have minority stakes in the company eamon javers joins us with more. good morning, eamon. >> reporter: good morning, joe absolutely a scramble over the weekend to figure out what they were going to do ahead of the deadline that the president proposed which was midnight last night. that deadline did not come to pass because the sides said they came to a deal and the president said that he has blessed that deal here's what we know from all sides in terms of where this is going to go in terms of a u.s. entity now that would own tiktok 80% controlled by bytedance, the chinese company. 12.5% controlled by oracle, 7.5% of equity to be owned by walmart. making a couple of promises here about what's going to happen next, including a u.s.ipo within the year they're also talking about 25,000 u.s. jobs oracle will be the secure cloud provider that's designed to get over some

of those concerns about data security and walmart ceo doug mcmillon would serve on the board of the new company the president said over the weekend there's a $5 billion educational fund attached to the deal some of the parties said they didn't actually have that in mind so we'll have to see today as we move forward in the day whether we can get all of those details in writing meanwhile, more big news over the weekend with the death of ruth bader ginsberg. the mother of all battles politically toreplace her this year you look at some of these cases for businesses in the supreme court during the course of this year, google versus oracle that is the software copyright case of the century people are calling it there's rutledge versus pharmaceutical care management that's about pharmaceutical benefit managers california versus texas. that's a big fight on obamacare. necessary lee versus doe that's about slavery

a lot of big stakes here for businesses in the supreme court during the course of this next term over the next several months and what was a 5-4 conservative majority will now be a 5-3 conservative majority for the time being and the big unknown, guys, here in washington is whether or when president trump can get a nominee approved to replace ruth bader ginsberg on the supreme court. that is going to be just an epic political battle in a year that was already a knockdown dragout politically. >> eamon, thank you very much. eamon javers for more on the impact of the oracle/walmart deal with tiktok, let's bring in senator rick scott. senator scott, it's good to see you today. thank you for being with us. >> nice seeing you, becky. >> i know that -- >> i think we need to get more detail >> yeah, i think you have long been very concerned about china and very concerned about

cracking down on them. what i will tell you today is "the wall street journal" is calling this at least for now a win for both bytedance and for china. the app is going to be continuing to operate and be operated by bytedance. the algorithm is not going to be transferred. it's rumor that this will be majority owned by americans. what do you think when you hear that what do you need to hear more about? >> we've got to get the details. let's remember why we started with this. there's chinese apps that are controlled by the communist party of china they cause security threats to the united states, data threats to all of our consumers and government so that's why we're looking at these apps let's get the facts. is this app going to continue to be controlled by -- have access by the communist party of china? if it is, i don't think we have to approve anything like this. we have to wake up to the fact

that communist china is going to be our competitor and enemy. they want to control this. by the way, they took away the basic rights of hong kong citizens they have a million people in prison they take organ harvesting they're threatening taiwan we have to wake up to the fact that communist china is not our friend anymore and they are not a friendly competitor. they have decided to become our enemy. ultimately it's too bad. until they change we have to stop doing as much business with them american consumers need to wake up and say, why are we helping a communist party that wants to control our destiny and take away our rights? >> that sounds like a pretty hard line that would be very difficult to overcome. is there basically no scenario under which you would approve a deal unless it was a full out sale to an american company? >> becky, let's remember this is all caused by the communist party of china it's not what president trump or

any president is doing, it's caused by xi he has decided to do all these things and so until they change, we've got to start waking up and saying, stop using apps where they can have access to our data they take our data they take our technology they have human rights violations americans, we have to -- unfortunately, we all want to get along with verybody. that sounds great, but when the other side wants to control our destiny, we've got to wake up to that >> senator, two questions for you. the first is as someone who has advocated for small or smaller government over time, i'm curious just about the approach on tiktok, which is to say this has not gone through the typical or usual channels. this is being driven -- i mean, i think this is one of the first times i think we've seen a major international transaction that's been negotiated in large part by an administration specifically how do you feel about that

how do you feel that a judge has at least blocked temporarily the moving forward of those app removals >> i'm a checklist process person so i think it ought to go through -- everybody ought to go through a normal process i have a bill that would first off require companies to disclose, you know, where products are made, services are provided, where apps, headquarters we ought to have a formal process to go through. there shouldn't be different rules for different companies. i like a process i do want to make sure that we stop doing business with chinese apps and chinese companies that have control by the communist party of china, that have access to our data. that's wrong that won't happen for my data or government data. >> senator, the other thing that is clearly happening and there's now lots of concern about a

potential backlash, you have the chinese media out there over the weekend suggesting that the way we, meaning the united states, has approved tiktok and wechat in terms of trying to make them effectively local businesses or shut them down is what should happen to all big technology companies, including united states based companies like google or alphabet -- alphabet is google, and amazon, and the like, and facebook how do you feel about that effectively -- >> totally different. >> -- not just europe, south america, everywhere they should be set up this way >> it's totally different. the difference is the government of the united states is not controlling google or microsoft or oracle, companies like that in contrast, the communist party of china is controlling parties like bytedance they have access to all of their data they have access to their algorithms america doesn't work like that u.k. doesn't work like that. china, you know, they don't want to live by the rules they never comply with anything. the wto or anything.

americans, we have to stand up for our -- for what we believe in we believe in this democracy i don't want china to control this that's what they're trying to do use our data to adversely impact this they've been doing this for decades, taking our jobs through technology this has got to stop. >> senator scott, the implication though with this deal is this is exactly the type of deal that the chinese like, that they have required in their own country, that you have to have a local partner you can't take data off shore. it must be stored there. is the administration wrong to approve a deal like this >> well, i want to get the details. if the -- if the ultimate deal is a deal where the communist party of china still controls this company, has access to all of this data, then i do not support it whether it's bytedance or whether it's any other company, i believe we've got to stabbed up and say, you know, in america we're not going to have the communist party of china control all of this data in our

technology that's what they've been doing for decades. this has to stop i want american jobs i do not want to be controlled by communist china look what they're doing. they've taken away the basic rights of hong kong people they're putting people in jail they harvest organs. they threaten taiwan when are we going to wake up and say, these are not our friends the communist party is not a good group of people they're a totalitarian government that's their goal. >> senator scott, thank you for your time today. it's good to see you. >> have a good day >> you, too. when we come back, a read on the economy. steve liesman has a cnbc rapid update. then the passing of supreme court justice ruth bader ginsberg sparking a new political free election fight in washington we'll talk more about that before we head to break, let's get a check on the markets right now dow indicated down by about 464 points this comes after significant

weakness in financial stocks and additional cases of covid building up in the u.k markets overseas in europe down even more than we're looking at here s&p is down by 46. nasdaq off by 15 "squawk box" will be right back.

as the economy recovers and activity picks up, some sectors are doing better than others steve liesman joins us right now with a look at the leaders and the laggards steve, good morning. >> reporter: good morning, becky. yes, let's first talk about the top line data which shows that the economy in the third quarter is doing a lot better than economists originally forecast, but there is some slowing going on we'll take a look at those sectors. look at that, we're now at 30% rebound estimated. that's up more than 9 points for the survey we did back in august these are good numbers unfortunately, it's not enough to get us back to even take a look at the forecast. you see that the economists took from the third and fourth -- sorry, from the first quarter and brought it back into the

third quarter. that's good news for us. a little less growth ultimately at the end of the year, 2020, down a bit less. down 3.9%. now let's look at the sectors. you can see that there's a bit of unevenness with a lot of slowing in the growth rate going on retail has been the one standout it's above the february level. again, the growth rate in retail last week was slowing. auto production, close to where it was the trend is slowing one area of oil production looks like it's growing. the last couple of weeks, they are a bit higher employment, that was doing 4, 5, 6 million a month, now it's down to 1 that growth rate is slowing well some of the commentary annette at that markowska and simons wrote, the summer slowdown was so slow that it was on the up side anyway. the direction of economic surprises will be determined by

fiscal policy on which we have no conviction at the moment. toss up whether we get that new fiscal package barclays writes the global economy is generally in better shape than assumed even if momentum is continuing to slow there's two things going on here one is the economy which had a huge spurt of growth from the shutdown is going to slow normally back to regular sort of growth rates that's going to happen you also have the potential of a knock on effect from the ending or the slowdown in fiscal stimulus in august so those two factors, i think, gave us great growth rate for the third quarter but it looks like it's going to slow now coming into the fourth andrew >> steve, real quickly let me just ask you about housing starts i was surprised to see that slowing because we've talked so much about how strong housing starts have been and how much demand there's been for new housing. >> well, it's just the housing starts number.

we had two great -- i was just looking at that before i came on air. let's see if i have it i don't have it up in front of me right now you had two really, really strong months. remember, also the existing home sale numbers have been terrific. the home builder numbers have been terrific but we did have a slowing in terms of the growth rate on this they're all growing. it's still growing >> steve, thank you. good to see you. >> okay. coming up when we return, suspicious transactions from some of the nation's largest banks. we have details on that after the break. then the question of the day, will the passing of ruth bader ginsberg mean a new covid relief bill is unlikely before the election we'll debate who could replace her and what it means for the world of businesans d for your money. "squawk" returns right after this

financials are front and cent center there was a reveal that large banks were moving massive amounts of allegedly illicit funds over 20 years despite the red flags over the origins five banks appearing most within the document trove, hsbc, j.p. morgan chase, deutsch bank, standard charter and bank of new york melon the banks are down more on this story at the top of the hour we're watching also, this is not a bank unless you consider donuts currency, which andrew

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welcome back to "squawk box. the death of supreme court justice ruth bader ginsberg friday night will consume washington making a phase 4 coronavirus relief bill unlikely until after the election this is chris kroger joining us now. joining us on the "squawk" news line want to get his analysis of what this means and really how this vacancy can not only change the election but change the world of business chris, when you think about what's going to happen here, just handicap it straight up do you believe that there will be not just an appointment but someone who's appointed and gets that role and gets voted in before the election or before the lame duck session is over? >> yes so, you know, base case -- >> 100%? >> well, no, the it's

washington nothing is 100%. i think sometime this week as early as tomorrow president trump will nominate a female nominee to replace the late justice ginsberg, either judge amy coney barrett or judge barbara lagoa. you'll have a judiciary committee hearing sometime likely in october, which unfortunately is probably going to be like the kavanaugh hearing on steroids. depending on the public perception and polling of that, we'll either have a vote before the election or we'll have a vote right after the election. the big variable is arizona. the -- you have a democrat, mark kelly, running against martha mcsally. if kelly wins that race on november 3rd, he could be seated as early as november 30th. this is the seat to fill the remainder of the late john mccain's seat. you do sort of have multiple

variables here, but it seems all signs would point to trump nominating someone as early as tomorrow >> and, chris, would it be considered a democratic fever dream that makes no sense to think that there will be republicans who would ultimately vote against or try not to vote, in this case, for a nominee? >> well, so the senate right now is 53/47 republican controlled in a 50-50 tie vice president pence would break the tie. mcconnell and trump can lose three republican senators and still get a confirmation they've already lost susan collins from maine and lisa murkowski saying they would not vote before the election there's still some room. a number of sort of swing votes or perceived swing votes came out over the weekend saying they would vote to move forward

rob portman, lamar alexander, roy blunt. this will come down to mitt romney, maybe chuck grassley and a few others but -- and then, you know, we'll probably get some polling on this in the next 48 hours or so that could also influence those senators who are still keeping their powder dry >> chris, separately there has been speculation over the weekend, you hear it from democrats saying if the republicans were to go through and confirm the president's nominee, that there might be conversations about trying to expand the court in the future if the democrats were to get into control does that make sense to you? is that a good idea? a terrible idea? >> well, it makes sense in that this -- you know, i think this -- you know, this has -- has already started moving i think this just accelerated what was the trend line. if you look back to really the

john lewis funeral when former president obama gave the eulogy for john lewis, when he equated the filibuster as -- with racism, he said that the filibuster was a relative to jim crow this was a signal event that if the democrats sweep, the filibuster could well be gone. >> right >> the big deal there istheory,e size of the supreme court and you could bring in puerto rico and perhaps washington, d.c., as new states increasing in each state getting two new senators as well. really, you know, incredibly massive policy changes. >> chris, in terms of business leaders who are -- who i imagine may be watching this program right now, how are they supposed to think about the two prospective candidates, both of

whom seem to be quite pro business and have made a number of what might be described as pro business decisions or helpful to large business you know, judge lago had withdrawn -- actually prevented a law that helped homeowners recover fees from banks. so if you're in the banking business, that would be good for you. if you were a homeowner that was proposed on you, that would be bad for you. if you were a leader of one of these institutions, you would think this was good. at the same time there are issues of immigration, dreamers, tim cook is coming out in favor of things like that. these justices are not in favor of things like that. >> well, the huge variable in all of this is, well, is the fate of the aca, obamacare, that's still going to be decided -- or heard the week after the election what a 5-3 conservative leaning

court is very different, you know, if you have a tie, you know, the appellate court would uphold in theory you have real volatility with obamacare. if the election goes to, you know, litigation, you could have a tie scenario if we had a sort of florida recount like in 2000, so, you know, businesses generally, at least from a policy standpoint, you know, want continuity and they want to know the rules of the road this creates so much potential volatility right at the end of this year. we'll see who the president nominates, but clearly it will be in theory someone who, you know, would line up more on a conservative and more pro business as opposed to pro union

policies >> hey, chris. continuity is the one thing that businesses want. they want to know how to operate. they want to know what the rules of the road are. the scenario you just late out, i mean, that just means to me that there's going to be less continuity each side is going to take massive swings either to the left or to the right and change rules any time there is a change in leadership. to me it sounds like businesses should be hoping that there is not one party that is running all things >> i mean, divided government generally has been more positive for -- you know, for equities. it's just a -- when you -- it's these wild swings. i think six of the last seven, you know, elections have been change elections, either removing -- changing out the congress and/or the president.

wild swings would seem -- some of this started with -- you can go back and rewind the tape wherever this started, et cetera i think what we're seeing now is the velocity of politics in this country in washington is going to continue to swing with just much more velocity than we've seen before. >> and then, chris, finally i wanted to ask you, what do you make of all the comments that were made in 2016 by various senators, i'm thinking of lindsey graham, marco rubio who effectively said at that time, as you know, that they did not believe a decision should be made in the -- in an election year you've now seen lindsey graham come back and say he called back the mcconnell rule because of who's controlling the senate prior to that they called this the biden rule at one point. so if, for example, those

senators were to, quote, unquote, go back on their word, does that change their own political futures or not >> i mean, yeah. some of the verbal gymnastics that folks are using is quite remarkable look, i think if you're lindsey graham running in south south, vn an election and having a fight over the supreme court is better than having a referendum on president trump every senator has their own race to think about and it does seem like we're less than 50 days from the election. >> we have president obama, vice president biden and ruth bader ginsberg saying if there's an opening, it needs to be filled within a year.

i've seen them all weekend it's tit-for-tat for everyone on the right there's someone on the left. i can cancel each one out. i'll give you a lindsey graham, i'll raise you an obama, right >> yeah. forget it, jake, this is chinatown. >> right. >> we'll see -- i think we could get the nomination as soon as today. so whether it's the right thing to do or the wrong thing to do, the reality is they're going to move forward mcconnell -- if mcconnell believes it's in the interests -- his interests, the party's interests to move forward -- >> right. >> -- as quick as he can, he's going to. >> chris, to expect either party to respond to, well, it's just not fair is like ludicrous that's the reason the democrats couldn't stop mcconnell from not

considering merit garland is because they can the reason they couldn't stop impeachment from the beginning of covid is because they can't the reason obamacare passed is because there wasn't a single gop vote because they can do it. they all do what they're going to do. it's almost like, why does it happen because the sun comes up and then it goes down. it's like a law of physics almost, isn't it these parties never do anything because of fairness, god forbid. >> just coming back to the longer term trend here it's going to be very much a tit-for-tat. when one party controls all three levers, the white house, the house and the senate, i think you're going to see really violent policy swings. >> that's why congress has an 8% approval rating, both things it's just business as usual and it's not pretty to watch. >> chris, before you go, in the

case that there's -- there was a -- there would be a 4-4 split. if we actually got into an election mess in this country and there was only 4 and 4, what would happen >> in -- so the lower appellate court decision would be upheld if we're in a, you know, bush/gore scenario, there is no -- there may not be a lower court decision so it's really -- you know, you're getting into the very deep end of the theoretical pool candidly, i don't know i'm not sure there's much legal precedent here for, you know -- you know, you can go back to sort of the 1876 election or things like that, right? it's not pretty. but that's -- we had a split court -- obviously a vacancy

going into 2016. so that -- it's -- you do have precedence there, but '16 wasn't obviously litigated. >> chris, we appreciate all of your insight this morning and i imagine we're going to be talking a lot more between now and the election with you. talk to you very, very soon. thank you. >> you've got it >> thanks, andrew. the futures right now have come back from down 500 to down almost 500 let's get to dom chu get back to just talking about some stocks and stuff. i want to move ahead is it above or below our pay grade, all of that other stuff i never know, dom. i like hiding in the relative tranquility of the stock market, which is saying something, isn't it when you have things like nikola and all of this other stuff happening. but at least we don't have to couch our terms in political correctness. we can just talk about stocks. >> it's crazy. markets, as complicated as they

are, are so much simpler and so much more clear than what's happening in washington, d.c., right now and will always happen in washington, d.c., right now maybe the simplicity gives some people some comfort, but let's talk about some of the ups and downs. this is very definitive up or down shaping up to be a negative day. not all of the stocks are in the red. you have shares of oracle up almost 4%. over 370,000 shares of pre-market volume. business software up around it's expensive. tiktok, that deal is why analysts at rbc have upgraded to outperform it's at 68, it was 60. they cited a shot in the arm to get things moved to oracle's cloud structure business watch the shares up in red tape. next up, shares of boeing which are lower to the tune of almost

2% over 136,000 shares pre-market volume the negative broader market, of course, overshadowing some news to put that stock on its conviction bconvic ion buy list they know boeing stock has under performed other parts of the industrial sector. then we'll end on a newly minted company, snowflake roughly 36,000 shares. not being helped and also getting a sell rating and post ipo and competitive pressures, becky, one up, two down, we know the tape is negative overall i'll send things back over to you. >> great thanks great to see you. >> good to see you. >> joe, what's up? >> you see what's trending >> i see a lot of things trending now, joe. what are you referring to?

>> no, i'm talking to becky. you're done. >> i'm done. >> i'm not talking to you. do you know whose birthday it is, he's 70? >> yeah, bill murray's birthday today. >> 70 years old apparently >> yeah, i saw that. he watches sometimes, right? so we want to send -- >> he was watching this morning, actually >> you name dropper. did you wish him a happy birthday were we going to talk about this >> you did >> i want to and andrew probably wants to. >> happy birthday. >> which is good okay big hitter you know who is a big hitter, bryson dechambeau, huge, 380 yards every time he swings unbelievable if you saw any of the u.s. open yesterday. wingfoot, big winner. >> beautiful, beautiful course >> this dude, they said he can hit it far but he doesn't have

what it takes to win like the open the only guy under par, but when you watch him -- you guys probably don't follow it that close. you know like a wedge is only this long and a 2 iron is that long and a drop -- all of his irons have the same length shaft. he's revolutionized the way the game -- weird putting stroke but it was -- anyway, happy birthday. >> it worked >> we digress. huh? anyway, good all right, folks when we come back, nikola's founder is stepping down as executive chairman effective immediately. we're going to find out more about this decision and who his replacement is after the break that stock is under extreme measures and then former airlines executive ben baldanza joining us to talk about a second wave

ovnd what it means for the airlines if it happens we'll be back after this break

welcome back, everybody. i will lumen na is a gene sequencing company total of $8 billion buying grail. it still holds a large stake in the company. grail is the developer of a blood test designed to detect cancer in the early stages take a look at illumina shares down by 3.1% joe. thanks, beck been talking about bill and

whether his ears were burning. phil, talking about nikola >> he's out. >> yeah. and gm plays into all of this. i don't know what you know about that, phil, but, i mean, it's not good, is it? >> well, the relationship remains between nikola and general motors but trevor milton was the driving force behind niko nikola, the stock exploded in may all the way through ten days ago, that's when you had the research that came out that essentially was from a short seller saying, look, we think a lot of this doesn't add up we think trevor milton at the heart of this is inflating the capabilities of what this company can do trevor milton issuing a letter last night to the nikola board of directors and putting it out on social media, in it he says i asked the board of directors to let me step aside as my roles of

the executive chairman and the nikola board of directors. the focus should be on the company and not me who takes over as chairman of nikola steve girsky he was the chairman of invecto which put together the spac ipo earlier this year. former vice chair of general motors long-time analyst. auto analyst on wall street. he will be the executive chairman or he will be the chairman not executive chairman of nikola wedbush saying trevor stepping down and nikola will be perceived by the street as a major near term gut punch for the lofty ev ambitions as he plays a key role how did he play that key role? social media he was every bit -- people talk

about how elon musk likes to use social media trevor milton was very much in that mold. he was going to be out there he was taking on the haters and he was not afraid to use social media. by the way, as part of his agreement to leave the company, he's a consultant until the end of this year after that he's gone completely. no role at all with the company, but he has to have all of his tweets with regard to anythinioi has to be cleared by the legal counsel even though he is no longer at the company. that's why you see this stock under severe pressure. this stock got up as high as $50 a share after they announced the agreement with general motors? no more will trevor milton be the face and voice of nikola,

they make allegations, the founder does leave, doesn't that throw -- i mean, i'm not saying where there's smoke there's fire i don't know what the end result is going to be, but it certainly seems like it would affect general motors that just coming so quickly after the big announcement and all the fanfare from that announcement. >> keep in mind, joe -- >> i know hindenberg is a short seller it seems like it peeks the whole -- >> it certainly doesn't look good it certainly doesn't look good in terms of an actual impact on general motors, what impact does it have? gm taking an 11% stake in nikola, didn't pay any money it had a chance to expand its size and scale in terms of ev production and cell production that's still in place. that's still going to happen as far as this agreement between

nikola and general motors. they still plan on having general motors build a badger electric truck gm will still be providing fuel cells for the seminikola is building in europe does it have an impact you're right, that does have an impact at this point, things remain the same >> phil, gm -- is gm in a position if they wanted to to call a macc, material adverse change clause claiming something here has happened? >> andrew, i don't know the details of the contract. it would seem to me that if -- if these allegations that were put out there by hindenberg, if they are greater than what we've seen already in terms of an impact with trevor milton

leaving the company, perhaps general motors could do that i get no indication from talking with people familiar with the relationship with gm and nikola, that gm has any inclination to end this agreement >> thanks for helping us >> thanks. >> make some sense of this wild situation. meantime, when we come back, what a second wave of covid could mean for the airlines. former airlines executive is going to be joining us right after the break. we will be right back with ben after this everyone wakes up every morning to a world that must keep turning. moving. going. the world can't stop, so neither can we. because the things we make, help make the world go round. we are builders,

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well, the airlines have seen a modest recovery in travel, but a second wave of the pandemic can be devastating joining us is ben baldanza we want to touch on boeing as well and whether we will see the 737 max return little do we know when we started on all of this that even if it does return, are we still ready to go to the u.k. with the second wave, ben there's a lot swirling around. let's talk about travel at this point given that the virus is far from put to bed at this point. >> well, joe, it's great to be with you again yes, another wave of covid would

be really terrible for the whole economy, and that includes the airline industry as well now the fourth quarter, which we're just about to enter here, starting in october, is traditionally a relatively weak quarter for airline leisure travel with the exception of the holiday periods at thanksgiving and end of december, and it's more dominated by business travel are businesses going to decide to send their people out to do sales calls, audit plans, have meetings, things like that, or are they not going to? the question for that is going to be whether or not they feel confident and the people feel safe doing that. i don't think we're going to see any kind of recovery on the leisure side until we get into next spring or summer. if you think about a normal year, if we can remember what that was, summers when everyone would have taken their vacations, kids would be back in school now so there wouldn't be

that much leisure travel right now and that wouldn't happen really until spring break starts to happen again. so if there's another wave and we're all shuttered back in our homes again and people are saying gathering, which today is already a risky thing, is even a riskier thing, then i think we're going to be looking at a very weak 2021 for airline demand and that means capacity is going to be very low as well. let's hope that's not the case. >> what's going to happen with boeing since we have a couple minutes left maybe, ben. will it not be called the max? will it come back? is it safe will people fly it what do you think? >> a lot of people were buying that plane before the crashes because it represented really good economics for the airlines. obviously boeing has needed to fix the engineering problem that helped cause those crashes with the way that mcas system, as they call it, how often it activates and what it does when it does activate

the other big important thing there is that pilots are going to need to be trained probably differently than when the plane was first sold boeing had a lot of pressure on it to put out a plane that didn't need a lot of pilot training because their competitor didn't need that. that's probably going to change some i think if they remove the max's name, that would be a good thing to do. call it the 737 900, go with their other naming conventions i think the max has that taint to it now with those two terrible crashes that killed over 300 people. >> how hard is it going to be on the rank and file at the airlines in the next three months regardless of what happens with congress, do you think? going to be tough. >> well, you know, that's one of the reasons i think it's good economic policy to extend the payroll protection for airline employees is because there are a lot of people that have been waiting to get these planes back up in the air and you'd like to think that the airlines could

launch these flights -- >> all right >> -- as we get into early next year with those employees. it's going to be a tough year for all airlines and that means for employment too. >> thanks, ben we appreciate it we're going to break wlleeouoo>>e' s y sn. we'll be right back. n. good morning, blair. [ chuckles ] whoo. i'm gonna grow big and strong. yes, you are. i'm gonna get this place all clean. i'll give you a hand. and i'm gonna put lisa on crutches! wait, what? said she's gonna need crutches. she fell pretty hard. you might want to clean that up, girl. excuse us. when owning a small business gets real, progressive helps protect what you built with customizable coverage. -and i'm gonna -- -eh, eh, eh. -donny, no. -oh.

good morning major indexes staring at big losses to start the week resurgent global virus fears and washington uncertainty both playing into the down turn president trump okaying a last-minute deal between tiktok, oracle and walmart could see the social video app continue operating in the u.s., but it's still unclear who would

actually control tiktok with the contradictory claims flying in the past 24 hours. the latest chapter in the wild story of nikola the founder stepping down, this just days after accusation from a short seller we're going to bring you the very latest in this still developing story the final hour of "squawk box" begins right now. good morning and welcome back to "squawk box" on cnbc i'm joe kernen with becky quick and andrew ross sorkin the wrecking teching the tech wrecking continuing more or less this morning. that's what a lot of this is about after we saw the huge move up obviously it sort of looked a little bit overdone and we're continuing to back off we had about three weeks now that we've sort of been in a

consolidation period and we're headed down again today. it's a big number in terms of points not that big in terms of percentage losses. it's adding up with what we've seen, especially with the nasdaq over the last two, three weeks we'll see. stocks, pretty amazing still about where they were before the whole pandemic so that in and of itself is pretty amazing. definitely in some sort of downturn here in september and a lot of people point to september in election years as being an important month depending whether or not an incumbent is able to hold on to the presidency so we'll see whether things turn around what is it is it the 21st have i got that right? got about a week. >> yes. >> 43 days until the election. >> until the election and not that many trading sessions left in september take a quick look at treasuries.

below .7 of a point. on the 10-year .663 this year, beck. we are following a number of stories at the top of the hour we have team coverage of all of them first, some new documents detailing trillions of dollars detailing things that seemed suspicious it does have the stocks of the financials under pressure. first we'll get to julianna tattle balm. julianna, our markets taking cues from the european markets that are under quite a bit of pressure this morning. good to see you. >> reporter: great to see you. thanks for having me on. the u.k. is having a rise in coronavirus cases. just from a couple of hours ago, we heard from the chief medical officer and chief scientific advisor here in the u.k. and they warned in a press

conference that the u.k. is on course for 50,000 cases per day by mid october if nothing changes. the markets are alarmed that we could be headed for further restrictions here in the united kingdom. they also said there's no evidence to suggest that the virus is milder now than it was in the spring. they said numbers are increasing across all age groups. the biggest increases in new cases is coming among the young groups, 20 to 29-year-olds, followed by 30 to 39-year-olds a very concerning message. we have in a bad sense literally turned a corner but only relatively recently. that's the message from the chief medical officer here prime minister boris johnson has announced that a second lockdown has been here for the country. he admitted that the united kingdom was heading towards a second wave. the prime minister is expected to have the second round a lot of nerves coming to the market we are seeing heavy selling from the footsie 500. the travel and leisure stocks

and banking stocks in particular getting hit quite hard guys >> okay. julianna, thank you for that meantime, want to get over to wilfred frost on the confidential documents that revealed trillions of dollars of i wi elicit funds >> reporter: good morning, andrew shares of hsbc have hit a 25 year low down around 7% after various articles pointed to suspicious activity in the past, specifically money laundering. a team of news organizations led by buzz feed said more than 2,100 reports filed by the financial crimes network hsbc said in a statement to us that all of the data cited was historical it pre-dated treasury's 2017 conclusion that hsbc had met commitments under a deferred

commitment act that they made in 2012 standard charter and deutsche bank bothre the brunt of the report like with hsbc, the report appears to be from the past, not the present. all banks in europe and u.s. are down sharply in europe, down 6 or 7% with the likes of barclays and lloyds which aren't mentioned are down sharply, too in the u.s., jpmorgan is down sharply but so isn't citi bank, wells fargo and bank of america. it's much more down to a big cyclical selloff linked to covid. worth noting as julianna just said, in europe lockdowns are picking up again in other cyclical stocks like the travel stocks are down sharply, too in the u.s. the supreme court news further makes the stimulus bill less likely and the banks

are probably disproportionately reliant and moving the headlines of that nature as well >> so, wilf, before you go, in terms of just thinking through the news over the weekend, and i agree with you, i think the stocks are moving more related to the covid situation in europe, but what are the true implications of what could happen as a result of this do you see regulations coming? do you see lawsuits coming as a result of these documents being released >> i've reached out for the morning. the hsbc one is pretty full and pretty clearly anything in these news reports over the weekend pre-dates 2017 which is when that conclusion came from an agreement they had in 2012 so if that's the same level of thinking applies to all of the other banks cited, then this is a report on something that the banks have already settled with treasury if that same thing applies to all of them you'll have to wait and see more

specifics on that. there isn't any implication in the report that this is things ongoing today that they just uncovered that regulators and lawmakers were not aware happened yet i would go one step forward which is interesting on a week last week when we got details on a second round of bank stress tests. i do think this group is more disproportionately, not just the stimulus talks but the election. anything that brings up the possibility that could lead to a change in direction in the tone and level of regulation the banks can face under a democratic institution versus a republican one definitely has stocks and on days where election day fears and big picture fears on news likethis >> wilfred frost, great to get your insights on all of this this morning appreciate it. >> cheers. >> joe thanks, andrew coming up, take aways from this weekend's drama over the tiktok

deal looks like it will keep the company operating in the u.s details of the agreement still very vague we're going to bring you the latest we just heard about those new coronavirus fears in europe on the stock front check out the airlines which are closely tied to how soon the global economy can fully reopen. big losses bigger than we're seeing in the averages shares of the big american cruise lines as well not fairg at all well this morning quk x"n atinyou're wchg "sawbo ocnbc ♪

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must see futures we have been in the red all morning long those markets in europe under extreme pressure more pressure than we're seeing. we're down 1.7, 1.8% in europe the markets are down by more than 3 in some cases 3.4% there's an increase in covid cases. they're pondering next steps s&p down 50. nasdaq down 177. president trump giving his blessing to a deal that would keep tiktok running in the united states. details are vague. there's a lot of conflicting information in the last 24 hours. julia boorstin joins us with what we know that's a question. there's a lot we don't know. >> reporter: there is still a lot we don't know, but what we do know right now, becky, tiktok, president trump has

signed off on oracle and walmart taking stakes in a company called tiktok global broken off from parent company bytedance. oracle will take a 12.5% stake of tiktok global doug mcmillon will join the company board. this new tiktok global will be 53% owned by u.s. investors and approximately 36% owned by chinese investors. tiktok's parent bytedance is 40% owned by investors including sequoia, general atlantic. they say they're committed to filing an ipo within a u.s. exchange within a year committed to creating 25,000 jobs in the u.s. they say tiktok global will have a license to all the source code including an algorithm and guarantee its security as to the valuation that these

companies are investing in, sources tell me it's still not finalized by a $15 billion number has been thrown out there and reported on a number of occasions. now the president also said tiktok global would invest $5 billion in education bytedance said it didn't know about that before the president said it was going to happen, but sources tell me it does seem like that will, indeed, happen becky? >> so, julia, one of the things we've been talking about this morning is those 25,000 jobs they've said will be created in the united states. do you know where those jobs will be created? which companies? do you have any guidance on that >> president trump said the new headquarters might be in texas so it seems like that is one of the options that texas governor said he had reached out to the president and expressed interest in having tiktok's global headquarters there there's talk of austin currently the headquarters are here in los angeles in culver city, but they do have offices

around the country we'll see if austin manages to secure that. i would think that those jobs would be somewhat spread out, not all of them in texas >> julia, on what planet, and i -- i'm baffled -- would they ever employ 25,000 people based on the current business that exists today my understanding is that snap has 2700 employees facebook has 4400 -- 44,000 employees. why would tiktok ever have 25,000 employees >> reporter: well, 44,000 employees at facebook. remember, andrew, a lot of those people are working on safety and security issues, securing the platform against interference, also monitoring to find offensive content. so there are a lot of different pieces of that puzzle, you know, different mosts that put together those 44,000.

tiktok is closer to snap you have to wonder how long it would take to get a company like tiktok to the size where it would have 20 or 25,000 employees. it would certainly take some time not sure what the time frame is but that commitment to that number was part of this deal >> okay. julia, thank you for that. we're going to continue the conversation and dig into what this all means for content, content creators across the world in social media and more broadly. bring in rich greenfield lightshed partners i'll ask you the jobs question there's so much of this that makes no sense, but 25,000 jobs. i don't even know how you can say that with a strait face given the number of jobs, as i said, that live at snap and also live at facebook facebook is so determinely

larger and then you get moot details of this then you have others saying, no, no, no, that's not true. basically we still own 80% of the company. what do you think is happening here >> this is going to make the most epic screen play. this is tech and hollywood all rolled into one. this is an amazing story if you had told me a week ago, even three days ago that all that you needed to do was basically take 20% of tiktok and sell it to two u.s. companies and that basically tiktok would still be a global company, all one app wherever you go around the world, basically it lives in every market other than inside of china, this is a story that -- this is the perfect hollywood ending for tiktok. i don't really know what effectively the trump administration accomplished, but this is a huge win for

bytedance, for tiktok the app, all the consumers that use it. there is no change this is an app that will get stronger i think the addition of walmart and what they can do in commerce in terms of turning ads that you see on tiktok into things that you can buy much like you've experienced in instagram, that's the big opportunity that will help consumers over time as well >> when you think though of the other piece of this, the geopolitical implications, what china may or may not do in response to this, do you worry at all about the disneys of the world? some of the big media companies that do -- i think there was fear that if tiktok were to have shut down. what would that have -- how would they retaliate this seems at the end of the day

the white house backed down. that thursday night on the tarmac in michigan this had to be sold. 100% there could be no ownership of tiktok in the u.s. that worried me, andrew. i was worried about what would happen what would be the impact of retribution? in the end, selling effectively a 20% statement. i wouldn't expect the type of feared blow back we might have been worried about weeks ago. >> right if you're waking up on a morning like this in terms of how you see the competitive landscape, has it changed it at all you talked about walmart both on the content side and the advertising. does it change the way you think of a facebook differently than

last week? >> look, i think tiktok being a robust competitor, this is going to add competition to the entire space. if you think of music and comedy, look at the cases of what tiktok is it most closely resembles google it's aging up. 60, 70% of tiktok is people over the age of 18. it matters to youtube. it creates competition for facebook and instagram i think snap chat investors who hoped tiktok would actually disappear. they're not going to get that benefit now. you're going to have tiktok as a robust competitor. it's not robust like snap chat you walk away and go, this is going to be -- this is one of the fastest growing mobile advertising platforms we've ever seen this is of course going to have

an impact on competition and for anyone who feared sort of monopoly status, this is going to add in their character. >> thanks for joining us we have a lot more coming up on "squawk" this morning. new data on the current economic impacts on the coronavirus we've got it and what it means at least in the near future. first before we do that we'll tell you why homeowners are making money during the pandemic. then where hundreds of c suite executives see business tax rates going. meantime, take a look at the futures. we are looking like we're going to open down on the dow. selloff. nasdaq down. s&p 500 down 48 points you are tcngsqwkoxon bcwahi "ua b" introducing stocks by the slice from fidelity.

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the dow up over over 170 points. thankts, andrew. >> diana olick. thanks to big gains in home values

9800 for core logic. in the difficult economic times, the number of mortgage properties dropping to 1.7 million homes. that's 3% of all mortgages this is especially important as some borrowers are unable to make their monthly payments and could end up having to sell their monthly homes. as long as they have some equity, they would not have to go into foreclosure. corelogic says this will cool and unemployment remains high and that could hurt home equity. joe? >> diana, thanks you know, mortgage rates

obviously always make a difference what happens with this entire picture if mortgage rates change one way or the other >> well, mortgage rates have definitely played into all of this home buying and have given people more purchasing power which makes prices go up if we see mortgage rates go up, which is kind of unlikely right now, but if we do, that's going to cause a problem for the home buying spree as of right now, i don't think that's going to happen any time in the future. >> people want to live outside of cities, diana is it that simple? >> it's that simple. not only outside cities, even in bigger homes even if they're on the outskirts. we're still in the market here this market is crazy hot, you have homes with backyards, more space and that's what people are looking for. >> what a concept instead of living on top of each other. took a while to figure that out. thanks, diana. trees, parking really, pretty simple.

anyway, we know about that, right, beck? >> yeah. i have to say, joe, just kind of walking around the streets here, riding around on bikes and things, i'm amazed at the number of homes that, a, have gone up for sale anybody who wanted to move or who maybe felt like they were trapped after the change in the taxes here, which put a lot of pressure on home prices over the last three years, a lot of places for sale. it's amazing how quickly they're taken off the market or go under contract things have moved quickly. i talked to one of my friends who's a real estate agent here, she's never seen anything like this this is the hottest season have you 50 people who want to see places in three days and everybody is bidding over asking price. >> have you ever seen so many people out and about there are so many bikes, so many dogs, so many people walking it is a total hazard you can't go over 10 miles an hour.

>> no. >> you have to walk really slowly -- drive really slowly. >> yeah. that's good. everybody's enjoying the outside. it's a good thing. >> one thing we can do, right? i guess. >> right right. all right, folks, when we come back, is wall street over hyping the impact of the presidential election? we will show you why some recent history suggests that the answer is yes exclusive survey data from hundreds of c suite occupants on esenalrus and the 2020 pridti election. don't miss it. "squawk box" will be right back. ♪ ♪

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welcome back to "squawk box. wall street trying to figure out the election trade handy capping which sectors will do better under each candidate if history is any guide, market reaction is pretty hard to predict. want to get over to mike santoli who joins us more on the markets

and maybe where they're headed mike >> andrew, it's understandable investors fixate on the election it's the main catalyst we don't see elections as a crucial or lasting driver of market cycles. we don't link them to any presidential election. that's something to keep in mind yes, there are some patterns about how the market behaves leading into an election when the incumbent loses the market is weak in the 6 to 12 months beforehand. when an incumbent loses, that's the worst lead up. the point being, usually these are kind of temporary effects. they're sentiment driven too many variables you have to get the presidential result right what the makeup of congress is what the initial policy priorities are going to be the prospects for passage and how it all plays into the markets and what's already priced in. very, very difficult to do usually other factors override that right now in this particular cycle there's been such a

persistent sense there will probably be volatility there's a tremendous amount of hedging. market implied moves around the election in stocks and bonds are pretty significant it's difficult to say whatever the likely result is going to be is not going to be somehow handy capped by the market beforehand, becky. those are all the things to consider >> mike, one more thing to throw into the mix with this this is a conversation we had earlier this morning it seems that you have to consider not only who wins the presidency but which party wins the senate and the house and how that plays out, too. one thing is for certain if there's a landslide on either side, that party is going to feel empowered to take some bold steps. that might be the worst case scenario to know that you're going to get significant changes in laws. what businesses like more than anything is some sort of continuity. >> sure. >> any time there's an election to have to rethink what the rules of the road are, that is a very difficult scenario. >> there's no doubt that would

sort of kind of rearrange all of the expectations and how businesses are going to have to deal with things, but i don't think it's really something that you can right now put a probability and a price on i think the thing to keep in mind is while those things matter, other things matter more you know, is there -- is the economic recovery have a momentum of their own? is the fed going to be accommodatetive? all of those things have greater influence on what's happening in the coming year than the policy mix from the fiscal side >> okay. mike, great to see you thank you. as we've been telling you, the economy is slowly recovering from initial economic shock of the pandemic many executives in the c suite are still grappling with losses back in the swing. they fielded a study of close to 600 business leaders to understand their concerns. joining us with the results of the road to the 2020 election survey is tim ryan u.s. chairman at pwc

great to see you. >> morning same here, becky >> so what did you hear from these executives what are they thinking as we're about nine months in to 2020 >> yeah. so a couple of key findings came out of this survey that was conducted at the end of august and beginning of september the first thing is businesses are -- 95% of businesses still believe we need some type of investment in stimulus given covid-19 78% believe they need it for their business 95% believe they need it for the overall economy. that being said, what is really interesting is 25% of businesses are seeing their revenues going up given covid-19. that's significant from what we've seen equally is only 20% of businesses expect their revenues to go down by 10% more and that's a significant problem because it was almost 35%. the other big take away, this

goes to the dialogue that we had in the earlier session 70% executives believe regardless of who wins, business tax rates are going to go up 63% believe traders in china are going to go up regardless of who wins the election. >> let's break that down one at a time the idea that so many executives you spoke with think that things are better, that they've seen an increase in revenue, is great news i'm assuming we're focusing on executives in big companies, not small companies. is that a correct assumption >> yeah. survey was 68% just over 575 executives then the remaining were not within the fortune 1,000 i think it depends on the industry, to your point. it's not necessarily large or small, it depends on the industry where companies are and what sectors they are. >> i think those executives also

said they think more needs to be done from washington, that there is some sort of planning that they'd like to see or funding or aid that would go out to businesses even if their own business doesn't need it, is that correct >> yeah. two critical things came across in the survey when we surveyed the executives the first one is 95%, which is an astounding high number, believe that additional stimulus was needed to boost the confidence and that's not talking about the businesses overall. what also came across is just over 80% of executives believe that we need more federal action to increase consumer confidence. 80% believe we need more federal action to bring a stock increase of production of essential goods to support the economy. >> the scenario of some sort of aid getting passed in washington looks a little dimmer today than it did last week because obviously dc's going to be

caught up in this battle over how to replace justice ginsberg. we've got the election coming up you may not see a comprehensive aid package get passed between now and election day does that matter, do you think >> yeah, i think it does, becky. i would agree with that. what's interesting is our survey showed the super majority of people, which is fairly consistent with what we hear in congress 80% of people in congress have the support. what and how do you get it done, which to your point is not likely to happen any time soon i would have said it prior to this weekend and i'll say it now. there is a sense while there's agreement, there needs to be action, it's likely going to take some time, which in the meantime we see businesses planning and business's keen focus on what they can control we see more focus in our client's businesses today than we ever have seen before in terms of focus and taking control and then hope to see

that the federal action catches up after we get through the election >> are they waiting to make plans or make investments until after the election are they going ahead and proceeding to make investments knowing that they've got to control what they can't control, as you said? >> yeah. really good question, becky. i would -- we surveyed into the surveys, we asked how their investments will vary. what was really interesting, maybe not terribly surprising, but interesting through the numbers, if the survey results yielded -- if there is a change in the administration, 57% of survey participants would increase investments in tax planning versus 43% if there's not a change another interesting element that came out of the survey was that if there is not a change in administration, 45% of executives will invest in supply chain planning analysis given the trade wars and restrictions,

that's versus 37% if there is a change so the outcome to the election will oot leaat least based upon survey work where people invest their money in 2021 will be critical for investments. >> tim, before we let you go, as you've been speaking, the market has continued to fall, not because of your words but the dow looking like it would open down 565 points. you're watching the nasdaq selloff. same with the s&p 500. all of this keying off of this bad news in europe about the continued challenges with covid and the spread there and the possibility of second wave given that you speak to so many ceos, all of them clients around the world, how many of them are concern about a second wave. what do you think it will do to impact the business given ostensibly the success for a lot of the largest companies in the world to continue to succeed

during this period >> yeah. there's no doubt there is a concern about the second wave but i would also point out that many businesses are complaining of a second wave whether it be how they care for their employees, what they're doing to take care of the tens of millions of workers out there working. they have been planning how do you continue to keep them safe also the majority is focusing on new revenue channels while there is a concern and i would say that concern has been out there for months and months, there's been a key focus of in the event of a second wave, how do you continue to get your products where they need to be so they can meet the needs of consumers. concerns, yes? i wouldn't say that has not been planned for. there's a lot of funding around getting ready for a second wave. one of the best things that's been out there, the amount of work people have done for employees to make sure they keep them safe.

that influenced tens of millions and then they are performing incredibly important work. >> hey, tim. want to thank you for your time this morning we appreciate the insights and we will check in with you again soon obviously we want to hear how those executives are thinking as the situation develops >> thank you very much appreciate being here. take care. >> you, too. joe? more news on electric vehicle maker nikola stock has been on a wild ride the whole summer the whole summer ends tomorrow, i think. so when we say -- can't say that much longer. whole summer penultimate day. anyway, founder and executive chairman trevor milton is out following accusations by a short seller of false statements from the company. detas iland analysis next. stay tuned, you're watching "squawk box" on cnbc

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welcome back to "squawk box. dom chu. we're down almost 600. are you going to show us the pre-market winners and losers. no talk about golf with the market down. it's unfortunate. >> i'm not going to. i wish we could have we could have talked a lot about that particular event. >> let's talk about what's happening with the markets right now. we showed you last hour some of the individual stock movers. let's go one level higher to some of the macro movers with the s&p 500, we are seeing a move here. the latest move off of the record highs that shows a little bit of support hovering above the average price. some traders look at that as one of the indicators of trend whether or not we could see a breakout or whether we get a balance there. that's a level to watch. now let's take a look at some of the sectors on the move over the last week.

where you've seen the biggest selloffs are in technology, communication services and discretionary. mainly the biggest to the up side as you watch what's playing out here, energy was a winner on a relative basis now it's starting to sell off a big year that could sell signs in a broader selloff. one other place to keep in mind, what's happening with the treasury market? maybe what they are showing is not a sign of a risk aversion trade. 10-year treasury yields, 65.5 basis points right there as you can see some of the volatility that we've seen over the course of the last few periods here has not yet played out here in the last couple of months so treasury yields still not moving significantly to the down side showing risk aversion andrew, the other place to watch is in cred high yield and investment grade. could be under stress if we were

to see a broader base selloff. they have not seen that kind of a move check out the etfs that we've seen in the past that have sold off when risk markets go wrong the ibox, hyg, both of them have been fairly stable over the course of the last few months despite the broader equity markets. andrew, for right now it doesn't seem as though things have gotten contagious with regards to the volatility. back over to you >> thanks for that, dom. appreciate it. nikola chairman stepping down days after a short seller targeted the electric truck maker. steven girsky is has been appointed chairman effective immediately. joining us is dan ives do you want to own this company at this point? >> look, it's a dark day

call it like it is trevor leaving, he's a key part of the vision. that's what investors would bet on obviously it's been a twilight zone for weeks there's a story with gm and steven focused on leading this no doubt, this is a gut punch to the story and definitely, you know, i think a white knuckle for nikola >> and in terms though of what could happen for gm, we often keep thinking of nikola. gm took a stake in this company. do you think they could declare a mac, material adverse change, and want out of this >> still talking that's something that still needs to come out in terms of details. gm has sort of continued to double down on this. this is their play in terms of nikola from a hydrogen fuel

perspective. obviously, you know, having a former executive of gm on the board running the board taking trevor's spot is a positive. that's a big part of the story going forward because right now it's a fork in the road situation given what we're seeing in terms of the shorts and worries now that obviously get gasoline poured on it given what we see this morning >> right dan, while i have you, and as we've been speaking, president trump's been making some headlines. one of the headlines, trump saying oracle and walmart will have total control of tiktok or we won't approve the transaction. they won't have anything to do with the education proposal. we just won't make the deal, he says what do you make of this transaction? do you think it's actually going to happen? i should also tell you literally as we were speaking, oracle putting out its own press release reiterating that once this company becomes, quote,

tiktok global, the shares that bytedance's investors historically had in the company will effectively get distributed down the chain does that do the trick, dan? >> yeah, we think it does. ultimately this was sort of that fort sumner moment opposite oracle and significant and the feather in the cap there is a lot of back and forth in terms of u.s., as well as beijing. but ultimately it ends up a lot more positive than it could have if the plug got pulled but, still, some twists and turns ahead as we've seen this soap opera >> okay. dan, we appreciate your time this morning >> thank you >> becky >> thanks, andrew. when we come back, the fallout from the banking industry from the bombshell report on huge amounts of allegedly illicit cash on the move money laundering these are reports that go back several years but you can see the impact on the stocks this

morning. deutsche bank now down by 7.1% as we head to a break, check out shares of royal dutch shell. the company is looking to cut oil and gas production cost by watching wti this morning, as well sitting just above $40 a brearl. stay tuned "squawk box" will be right back moving. going. the world can't stop, so neither can we. because the things we make, help make the world go round. we are builders, constantly creating things that make our world cleaner, healthier, and more connected.

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[horns honking] ms. robinson: we're ready! ms. zamora: ¡estamos listos! ms. duncan: we're ready! ms. williams: we have missed you so much. ms. zamora: we're with you every step of the way. narrator: making our school buildings safer. ms. williams: no one wants to be back in the classroom more than teachers. mr. hardesty: but we all have to be safe. ms. robinson: we take great pride in making sure all of our students achieve. ms. duncan: remember to wear your mask. ms. robinson: wash your hands. ms. zamora: and stay safe. narrator: because the california teachers association knows quality public schools make a better california for all of us. welcome back to "squawk box" get down to cnbc headquarters where our good friend jim cramer is i could talk tiktok and talk about what is happening in the supreme court but i want to know

what you think about what's happening in the markets right now. >> such a big overhang from what is going on in europe and i question that. suddenly people are discovering that the market is weak, but many of the big faang stocks are down double digits i'm tempted to take the other side of the trade looking for opportunities because it isn't like we just discovered the downside and this european weakness, yes, another lock down in europe, not great but we have to see whether there is going to be a lockdown in the u.s. so far so good when you watch the things and i'm looking for opportunity because everything is so ugly. isn't that when you look for opportunity? >> it is, jim. i think that the question right now is when you're looking at what's happening in europe, is europe three, four, five weeks ahead of where the u.s. is going to be later? i think that's one of the concerns i think there is this other concern about the banks in europe the standard charter getting hit by this news report over the

weekend in terms of these sars documents. do you think that has real implication or no? >> i think these banks are very weak they have weak credit. there's a lot of carry over. take a look it's a good bank, but it is down all the way under two. and deutsche bank doing terribly you see morguan lumped up with them, pretty extreme will uk have another lockdown? yes. will we have another lockdown? don't we have to wait to see a spike? i'm a big mask guy and social distance guy first of all, let's take the nfl. has anyone come up with covid? big 12 things that happened that makes you feel like some people are doing it smarter than others i don't think they ever took it seriously in the uk. i think they took it seriously in madrid and they let the bars

open the bars can't be open that's where you get it. don't go to a bar. no matter what including bar. >> we will see you in just a couple minutes i want to hear more about what you think of these markets and get your take on tiktok but i'll be watching and listening. >> great show this morning little more something positive >> i think maybe jeff hart can help us here banks are taking a hit in the premarket here and in europe we just talked about documenting trillions of dollars of transactions joining us jeff hart principal at piper and you think this whole money laundering saga feel more like an excuse than a driver and comes after the banks outperformed last week >> especially looking at u.s. banks like a jpmorgan down and they're high beta, i get it. last week the banks did

outperform and you could see profit taking there and i think what people are increasingly doing with the banks is looking beyond cred. we know the covid credit situation. but once we get through that and what does the environment look like it looks pretty tough. not a lot of long growth and intrust and it doesn't help much but i think looking at some of the headlines, there is a reason for the decline here i think it's more the nail finding the hammer than the hammer finding the nail. always create some dislocation and even if there is something there, though, these things take years to play out. a long time before you get any kind of answers on it. i think what we're probably more likely seeing is banks kind of hitting the low end of the recent trading range and tougher to break out of that trading range until things look better, you know, as far as the outlook becomes more clear to give you something good, though

i do think when you look at a jpmorgan or b of a and these are the type of players that really have it. you have a be a selective investor and jpmorgan and b of as are the place to be. >> when we get through covid the other day and what's, obviously, what's happening in europe not the aml stuff, but the covid stuff is casting a poll on the entire market. even if we get through that, you say still reason for concern in terms of profitability for the banks. the yield curve and the loan growth do you think we're near the low end of the range this selloff is petering out this week? you think that the banks resume more positive trading or look through to see that it is not great after covid.

>> giving up some recent gains and when you start looking into next year and incrementally all we're getting is good news on credit that could change. one of the big concerns and that seems to be fading a bit but does leave the investors to look and say, once we get past credit how does profitability look it is not that profitability looks bad but x-credit profitability improvement when you're looking at a really flat curve and we're not seeing much long growth at all i would say it's a pretty uneventful or maybe neutral outlook once we get past credit. things can't go up from here and probably will go up from here. but it becomes a pickers market and certain banks are going to do much better next year and the banks in general >> jeff harte appreciate what you had to say this morning about the banks. i don't feel awful now i don't feel great anyway, we'll see you again

soon thanks final checks on the market we're coming back from the worst levels, but still down more than 500 points on the dow. we have the nasdaq very weak, once again leading the markets lower and then down 50 on the s&p. becky, see you tomorrow. you're back. andrew, see you. we've been together. it's been bliss. anyway, make sure you join us tomorrow "squawk on the street" is next good monday morning, welcome to "squawk on the street." weakness does continue dow futures down 500 plus. s&p looks to open at about an eight-week low as the reopening concerns in europe collide with political concerns of the united states after the death of justice ginsburg our road map will begin with the lockdown warnings in the uk. stimulus talks in limbo back home futures are sharply lower ahead of the open.