14 points? over oklahoma? would you give 14 points to any of these teams >> draftkings bet instead of the bracket? >> my brackets are, you know, i told you i was betting against my brackets and i was doing well but i just don't know about 14 points i'm going to think about it. >> a lot >> that's a lot. >> how many games have you seen 14 points over the weekend not many. >> very few. >> these teams are so good, this he don't give that many points anymore. it should be a parody by now 14 points. >> we got to run see you tomorrow bye. time for "squawk on the street. street" i'm david faber with jim cramer, carl has the morning off. a look at futures as we get ready to open another week of trading. as you can see, a mixed bag, nasdaq going to look stronger. our road map this morning does begin with a big deal in m&a, it's a rail deal worth $25

billion. kansas city southern, announces that it is being acquired by canadian pacific then, new results from aft zan ka, what the company told us earlier about its efficacy here in the u.s and later, tesla to 3,000? we'll break down cathie wood's latest bull case. jim, i'll start wherever you want you decide the direction here, in terms of what we should start with our viewers here at 9:00 a.m. i woke up and saw this deal and said to myself, this makes so much sense. i've been waiting for it i look at warren buffett's number, at the end of the week, they show you how much business burlington northern is doing and the numbers are about to cross into the low teens i think that rails are incredibly valuable because of scarcity david, the thing that i don't know, if they don't overlap, then why wouldn't the authorities go for it?

>> it's likely that they probably, well, we can't pre-judge these things, the surface transportation board, we know, jim, from previous attempts, by various rails, with certain consolidation they haven't liked, but to your point, with no overlap, i think the expectation is more likely that they will say yes to the deal and of course, the way it's structured, and the way we've seen previous rail deals structured, you can even go back, way back to when there were deals involving broadcast licenses, creation of this trust, so you're going to be able to sell your shares sooner than when the regulatory review period has ended, into the trust, and then they will take on the risk, at canadian pacific of closing the deal and should it go against them, they will have to figure out what to do with that ownership of kansas city in that trust but you're right given the history at least, the fact that there's no overlap, the fact that kansas city

southern by the way was exempted from certain rules as well, and we will be talking to keith crell, the ceo, a little later in the show about a lot of this, it does appear likely that this deal would potentially get approved, jim, and a reason why so few other potential rails could come to play here. >> i know mexico pretty well i got to tell you, the amount of business that ksu does in mexico is so unbelievable, and it's auto, and now i know that the former president did not favor cars being built in mexico versus here, but that doesn't get talked about much anymore. so david, this is a power house idea, because it is, because this is about mexico, this is not about the united states, which is why it is so excited for cp, because they have become a major, and what i think will be an amazing auto market, a major importer of mexican auto what is just spectacular, so this is a big number razor for

cp if they can get it done. >> if they can get it done, it will take some time, 60% of the consideration in stock, 90 in cash and .489 canadian pacific shares so we will keep a close eye on those shares and see how they perform this morning. so down, but not too much and we haven't opened for actual trading as of yet. and talking about annual synergies of 780 million of three years. >> low ball. >> that's low ball and a couple little background here, having talked to people as you might expect, close to the transaction, i mean this conversation has been going on for quite some time, august, september, i think, this really picked up, in december, i'm told, in terms of really focusing on a deal, there was a p/e bid there, there was a bid from blackstone, previously reported by "the wall street journal," jim, and it was all cash, and obviously, did not carry the risk that this kind of a deal would however, i'm told it just wasn't close enough in terms of the number to really compete with what canadian pacific came with.

and so the board made the decision there that this is by far the better deal, and again, they've got the big break, they've got the voting trust, and we'll see where it ends up >> david, doesn't it feel like that's the kind of deal that would have happened pre-pandemic, where there's just a sense that autos are going to be good, and mexico could be, actually pre-president trump, it does feel like, david, that when i saw, i mean look, i got the emails, you probably did, and obviously, on the people who are, the principles, and one thing is certain, david, it just doesn't, it's not about the pandemic anymore i mean it's just about pure business has something happened >> well, listen, it's a good question this is not a deal that is foreign to anybody who has thought about consolidation in the rail industry, right and this is obviously the smallest player, so to speak, and creating, as you say, canada and mexico, i mean, but why now?

listen, they've been talking about it for many months, if not even longer in some way, been considering it, jim, but perhaps it is a reflection of the expectation of the significant economic growth that's ahead for the region, and the increased trade that's going to take place between mexico, the u.s. and canada, especially given that new free trade agreement that went into place not that long ago. so yes, i guess, i guess it could be and by the way when it comes to mergers and acquisition activity and i will put spacs in a separate area, because obviously those count as mergers when they do their deal, but there is a lot, speaking of a lot of people around this deal, who do a lot of other things as you might imagine, there's a lot of activity and so i think we can expect to see other significant transactions, transformative, i don't know, but significant. >> yes, i think this is important, there are a lot of people who feel that when you raise taxes, you hurt capital formation. david, i've never, i have never seen in the amount of capital formation i'm seeing now

i always expect an email every morning, from someone, who is doing a large spac, and i've never seen anything like it, david, and i got to tell you, i can't keep track of them but they tend to be done, and the new ones are being done by heavy yates what i think you probably want to buy. >> really? so iron sort you like that one, for example, the giant one coming today >> which one is that >> tomo bravo. $11 billion deal >> they're fabulous. >> yes. >> another one tomorrow, i think, the another one announced. spitfire jaws spitfire 3 but let's move on, jim. >> i'm just watching this mp that's a spac. >> yes. >> and it just had an unbelievable quarter if you get a company that you can ride, you can make a killing, david, so it actually matters what the companies are doing. >> it does by the way, i would point out when it comes to spacs, jim, many of the ones that are pricing now are not moving hanging in there at 10

and a couple of months back when immediately upon pricing, many of these would move up 10, 15%. >> that's not happening anylonger. and even though we continue to see just waves of new spacs entering the market, and then we also see the announcement of deals. we'll get back to more of that later. >> yes. >> i want to hit the broader market i want to hit tesla. and we want to talk about the 10-year. qr do you want to go the ark target price for 2025 for tesla? >> i don't think there is a fund manager in this country, when i thought about this initially, a fund manager in this country that could get away with this kind of thing other than cathie wood and i say that because if it were a brokerage house that came out and said this, david, we would dismiss it so quickly, as being hype but cathie wood actually is so good that you start thinking, okay, well, what is elon musk going to do? maybe he's got a lot of mind

that she's thought about and i know that elon musk wants to reinvent the entire grid, the entire grid, which remember was put together in piecemeal. so i know that there will be people who say jim, you shouldn't have used the term get a way with, but i do feel, david, that she has the cache to say, it and not be dismissed when i heard it this weekend, i spent a lot of time trying to figure out how she got to that price target >> okay and? >> i just think that she's using the notion that elon musk is going to be able tomake cars everywhere, but it's not just cars, it's obviously bigger than cars >> it's got to be bigger cars to get anywhere near that. >> it's funny, the different percentage chances she puts on things, the bull case, a 25% probability tesla could be worth $4,000 a share, or more, in 2025 so four years from now >> what would happen with bernstein? >> we would think he lost his

mind >> he ate something with his breakfast. >> yes. >> i like tony. >> bringing on hallucinations. >> and there are different firms, the jonas brothers at at morgan stanley >> i gave a hard time to an analyst recently seven or eight times revenue. but this is the most successful fund manager of recent time and captured the imagination of man investors and the performance numbers are there. >> do you have a knock on wood >> do i have a would what? >> a knock on wood. >> yeah, sure. >> someone is very smart >> i saw it. >> that's real smart. >> clever people. >> there's been a series of article nous that talk about, i didn't even know this, do you know what a "stimi" is >> a stimulus check. >> so they will buy cash stocks. >> the stims. >> are they even going to, even as of late with the decline in

some of the high multiple names, because of the move-up in part, in treasuries. >> they don't know why, but you can go buy a sliver of a, a stimi sliver. >> what should i buy apple down 9.5% this year. amazon down almost 6% for the year tesla, i've got down 7% until today, as you can see, it's going to be rebounding a bit what do you think we should, they should be focused on, and/or how should we be focused on what they're focused on >> look, i think that's a great question the interest rates today are down i do think that that means when, i wish wedbush hasn't used the term super cycle, every super cycle has been a disaster, i think apple has been done a lot but not enough and i think it is too early to buy some of these stocks but they are getting very low versus where they were facebook continues to go higher. >> i noticed that as well. yes, facebook suddenly reversed course >> the earnings are going to be good. >> everybody suddenly, it's not

a high multiple stock, that's for sure. >> who has been attacked australia, with a tussle there and i don't think it's canada he will tussle. with who else is a great ally of ours that he might tussle with >> i'm not aware. >> that's why the stock can go higher it's an inexpensive stock. i think they should buy alphabet because afrl bet has earnings momentum. >> and talking about one of the better performers of faang so to speak over the last couple of months alphabet is up nicely. >> and you get cathie wood and what she did that day and of course, it is not everything, at around 6:30, she's a seller of a lot of things, and she likes that fantastic spac that is the -- >> butterfly >> boom. >> she likes butterfly. >> butterfly, we should tell people, butterfly is a real company. >> dr. rothberg has been with us a couple of time, capa, another

deal a unique gentleman. >> she loves him. >> and i think everyone should get, what you can get, with the distribution list, and you can see, she likes disruptive technologies that are not involved in kind of -- nothing to do with the linkage of bonds. she doesn't care at all about that linkage but 3,000 instead of 2500, david? >> these are not questions i can answer like so many others. >> this is like the cosmos >> yes >> like the universe i just can't get my head around it. >> where does our souls, where do our soul goes after we die? >> i'll think about that after the break and have an answer for you. >> bring them back. >> and canadian pacific ceo keith creer will be joining us this hour. the opening bell 17 minutes away a lot more for you on "squawk on the street."

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chairman of the board and stepping down from the board overall. and it's quite a significant departure. i mean you think about some of the, the three big firms when i think about them as kkr, apollo and blackstone, sportsman still at the helm of black stone and kravitz, kkr and black, no longer the case. 70 years old embroiled in a lot of the attention coming from his relationship with jeffery epstein, and the fees that he paid him, we'll have more on that in a second from his statement. but it's a significant moment, and there was some, perhaps somewhat unexpected in terms of him departing the board. remember, he is a very large shareholder here but in the 30s-plus percent. by exiting the board by the way, it does enable him to potentially sell stock as well. >> i think it's important for people to realize what a titan this guy is, he has been with us forever. >> yes. >> and i know that he's caught up in the investigation, but he's got, you know, he said i thus view this as the ideal

moment to step back and focus on my family and my wife debra's and my health issues and my many other interests, i think he's owed that statement. at the same time, the review that decker did found no criminal evidence with epstein but a total of 158 million for tax and estate planning to epstein? >> that raised some questions. that brought him attention by the way, black has always been, just not somebody that i ever got to know well at all, as opposed to the other gentleman we mentioned he's not, you know, he's always kept a much lower profile, but apollo has been one of the giants, has been an extraordinarily successful firm, and will now be led by a new ceo, who has been there for a long time. josh harris, one of the other leaders of the firm remains as well let's read more from his statement, because you know, he does reference epstein, he says the relentless public attention and media scrutiny have taken a toll on my health and have caused me to wish to take some

time away from the public spotlight, and as you say, he goes on to talk about his own health, that of his wife, deborah, as well but it's an important departure. and certainly one we didn't want to not feature this morning, jim. given his importance in private equity he's obviously an immensely wealthy man, an in cell art collection, far beyond the ownership stake in apollo and collecting art from an early age, mr. black, and we'll see, we'll continue to follow and watch the story to the extent that anything else should occur here apollo shares probably not going to do much of anything again, he was planning on stepping down as ceo, but it all got accelerated, and the important point here is that he has now stepped down as chairman of the board and informed the board as well he stepped down from his position as a member of the executive committee on the board and from the board as well leon black, and apollo splitting ways aside from his ownership stake.

>> people need to know this. we talk about bezos and gates. and one of the richest people, he has built a huge empire and i think people should know that. i think he is incredibly savvy. >> no doubt about that. >> we got a lot more for you, including jim's mad dash, as we unowton encotdn aoping bell 10 minutes from now. stay with us

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let's get to a mad dash, i think i overheard pinterest. >> and snap. >> this is a bank of america piece i'm referencing. david, for those who are caught up in the notion that, how interest rates affect stocks, they should read this piece, because it really is about how, when rates go higher, what is

with these stocks that go up 500% a year? >> that's what i'm saying. it is time to rethink. and they want to downgrade because these stocks are going to have multiple compression, based on the yield, and that they're far too linked with the stay at lome movement when people are going to start going out. so they like booking, booking.com. and you know what, david, i'm in agreement with this. i happen to love pinterest but you see that this to that, one good quarter, right? and i like pinterest because it's hobbyists and stuff, but this is the residue of that era, where if you live inside, and didn't think that the vaccines were going to roll out this fast, you have another couple of quarters and i don't think people feel like that, and people are looking at astrazeneca, we haven't talked about it and i don't know whether people want to go for it, but the vaccine is starting to be available for people who are not my age >> yes. >> and that means they're going to go out, and they're going to travel again, and so therefore,

maybe they don't stay home and look -- look, i think people still cook i really do. but if you think that they aren't, if you think, you know, you're going to look at the pinterest part for travel and a big european component and europe is still shut down, but i do point out that when you look at snap, can we show snap's chart? snap is unbelievable >> yes. >> there is this multiple correction if you get rate, look at this one, david, if you get rates going up more -- >> i just, you know. >> i know. >> people need to understand that remember, the comparisons right now, we're at, almost at the bottom, but people need to remember that 470% rise in a stock price in 12 months - >> that's why this is a very common sense piece the bear case, more multiple pressure, i mention it, because a lot of the younger investors, david, the stimis, they got to learn it, because they might be surprised why pinterest is going down and even though pinterest

isn't saying anything and it has to do with the faction that attrition money managers look at the 10-year and make a decision whether this is up too much. >> yup >> we'll be keeping an eye on both of those names, of course, and a lot of other movers this morning. as wgetoe t the opening bell just a few minutes from now.

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the plan is to file in the first half of april for the emergency use authorization and then in the hands of the fda, how fast they can decide about the approval, and assuming that the approval will take place in a fast, fast way, we hope to deliver 30 million doses instantly after the eua for americans to get vaccinated. >> that was astrazeneca evp and president of bio pharmaceutical ruud dobber and talking about the vaccine efficacy here and saying the shot didn't pose a higher risk of causing blood clot, jim, you mentioned astrazeneca and another potential entrant and we will have a lot of vaccine choices

and conceivably i don't know where you are in terms of your time line where may, june, where everybody can get a vaccine who wants one. >> and i worry about the last part of what you said. you have to watch royal caribbean here, david, because royal caribbean is going offshore to be able to make it so that if you're vaccinated you can go, and the crew is vaccinated these are cruises that would go out of miami, probably and our country does not have a good policy in terms of getting the, the so-called vax passport, but i would say, david, that if people, if people right now tend not to ask which one they're getting, i wonder because of all of the negative publicity, people say no, i don't want astrazeneca, it would be a shame, because this is a very good study, much more rigorous than what they did in europe and i would take it in a second. >> you would >> absolutely. >> but you know david, i think you're right, anyone who wants one, that important caveat, but it is changing the country, and it is making it so that people

are traveling, and you do, all of the buying that you see, for companies that are involved with travel, i think we're going to be vindicated. >> although you brought up an interesting point on friday when we were talking about that debate about once you vaccinate fully, you still need to be wearing a mask and is it in some way not giving people - >> i think you could do it out of courtesy. that's the reason. >> yes. >> but i do think that there's going to be two classes of people, david, the vaxxers and the non, and i'm not sure whether that's discriminatory or not. but we have to stay focused on it because you have whole industries like the cruise industry, like the airline industry, where it may just be, show me your pass, i mean i try to go to a doctor the other day, and i got stopped at the gate because even though i had moderna, and even though my temperature is down, i mean it's the same, all they cared about is did i go to florida and i think that that has to

end. >> hopefully, as soon as possible >> you saw the opening bell there, of course, as we get started with trading here for a new week tumultuous week last week, of course, jim, as we watched the 10-year yield climb to heights we had not seen in quite some time the financials did quite well, as you saw that steepening yield curve, let me take a look now, not as much, everything seems to be down a bit, although again, many of them near their highs, what, as we head into this week, now, and begin trading, what do you see, and look at the 10-year, at least we're trading from above 1.7, what is the key to the market? >> nike. because i want to find out whether this market is forgivable nike reported a fantastic quarter in china a good job in western europe but because of the port congestion, and a lack of containers, they missed the number big and the stock got hit, even though everybody kind of knew, it was just this port congestion, i have been working

on port congestion, it is very hard to get a handle on whether the issues are labor oriented, whether the issues are true shortage but if you find nike going up, then you recognize that the market is willing to forgive a company that did a great job, but then failed in the u.s. and if they do, remember, that's a dow stock, and don't forget other stocks, i was going to pick pepsico at the key of the market and they got upgraded but i felt that pepsico, they haven't missed at all and i think that nike missed and i want to see whether people want to overlook nike a dollar gen feel that that one has gone down too much nike goes up with stimulus and pepsico does not have any link to a stimulus. >> that's a good point does dollar general have anything to do with stimulus >> yes, it does hit because people thought they were a little downbeat? >> their guidance was. they were pointing flat to down two if i recall. >> and therefore, see, nike,

nike was very confident they would recruit the lost sales and dollar general, look, i can't be more confident than a company is and $general was not updata -- and dollar general was not upbeat the numbers were not great in the last two month, you're going from a company that is one that you don't have a lot of money to go to, to one where we think that maybe the economy turns >> yup. >> but i watch the industry, and it's entirely possible that rates by the end of the day go up it's almost unsustainable when you see rates down. >> yes right now, we start in the green with the s&p and the nasdaq of course, you mentioned the dow, did appear it was going to be lower. jim, spacs, let's get to some of them this morning. >> yes, please >> i did mention this iron source to you. it's a very large deal 11-plus billion overall value, it's tomo bravo advantage spac

and we'll take a look at that. in case you wanted to know they're valuing this company, ebitda was 104 million, so that kind of gives you, 11.1 billion, divided by 104 million you can figure where their value is, with a multiple of 332 million in sales and the top line is growing 83% year over year and i know you know what they do, jim, but some people may wonder, so let me tell you. they provide the most comprehensive platform for the app economy. the platform is designed to enable any app for game developer to turn their app into a scalable successful business, by helping them to monetize, and analyze their app, and grow and engage their users from multiple channels, so they've got that going for them. >> it does sound like unity. which is a very big young person stock. can you say that >> a young person? >> compared to us, everybody is a young person. >> that's true but i think it's very important to recognize that there are two group of of stocks there are the group of stocks

that are are loved and that's, unity, and then there the groups of stocks that are industrialous. and those are loved by older people >> like if you want to talk about one that we, we got to talk to our special guest for a second, but a name you focused on a lot and i did as well and i got a lot of hate for it which is lucid you remember of course which is the first reports about lucid and church hill iv. >> yes i don't know if you saw the s-4 which they filed giving background on the negotiations on january 11th, 2021, bloomberg published an article stating that churchill, this is churchill iv was in discussions to acquire lucid, however at the time the article was published, churchill and lucid had not had any discussions with respect to a potential business combination. so maybe bloomberg gave them the idea. >> wow it happened. >> but it wasn't happening then. >> i thought that michael kline, who runs churchill capital and

peter rawlinson have been talking for months because we talked about it. >> yes, it has been months, but not on that time, not at that time, when we said that, you know, be careful, because sometimes deals don't occur, and they weren't even, they hadn't even had a conversation about the possibility of that deal >> and people got crushed on that >> they did. >> it went to 27 and you know that michael kline never wanted that, i mean -- >> no. >> he was horrified. it is nobody's best interest to see something go that high by the way, if you started at 10 and moved up nicely to 27, everybody would be applauding without a debt. >> but lucid, i've been in one, i would describe lucid as a, i was trying to, this weekend, kind of analogize to lamborghini, the lamborghini is ice, internal combustion, and i feel this is a luxury race car that goes 500 miles per battery charge and therefore it is worth something, but david, the valuation is very high and when you look at the valuation of churchill capital, 7 billion, that is not the real,

that's not the value -- >> the deal has closed 1.6 billion shares outstanding take that number of churchill i l-iv, plut my that by 1.6 billion to get your actual market cap for people. >> why is that so opaque because people may not understand it. >> take a look at the filing, and you can figure it out. >> younger people don't look at the filings. we will have more and more spacs coming, spitfire spac, the vela 3d deal, most likely tomorrow is what i'm hearing as well let's get back to m&a and over to morgan brennan who is joined by a special guest, morgan >> thanks. shares of kansas city southern surging this morning this after the company agreed to be acquired by canadian pacific railway and valued at about $25 billion, and now, if approved it would create the first freight rail network linking mexico, the u.s. and canada. joining us now for a first-on cnbc interview canadian pacific ceo keith kreel, thanks for being with us this morning

congrats on the deal. >> good morning. it's an honor to be with everyone this morning. >> so we've heard about the possibility of a canadian railroad and a u.s. railroad coming together for years now. we haven't seen it happen until today. why now? and perhaps even more importantly, how is this a vote o on not only economic recovery in america but growth >> and i think it's better said, how you can not now? it's the perfect time for a deal like this. and often for a deal like this, of this size, this magnitude, you know, the stars have to align, and i would suggest the stars have aligned, and enabled this deal to happen. you've got two railroads, two, actually two of the smallest railroads in the class one space, that have enjoyed and produced and outsized performance. we love the industry, we led the industry the last three years on a cagr basis and earnings growth, pretty compelling and with like-minded ceos and two like-minded companies focused on growth and great service, that

see the power of this combined network. i've been in this business for 30 years i've long recognized the value that can be unlocked in combining these two networks so to have that opportunity now, with kcs, at this historic time, you have the background, north american trade has never been more important than it is today. so again, how can you not do this now, to create an economic backbone, a network that can serve as the backbone, to drive that growth, for all of the stakeholders it's pro-compe ition it's pro-service it's pro for customers, employee, and the north american economy. so how you can not >> i want to get into all of those pros, but first, it's my understanding that yourself and some folks at kansas city southern, pat and the like, really began talks in ernest in december how did this deal come together? >> as i said i've had my eye on

kcs for a long time and i have been leading canadian pacific for the last four years as ceo, and strategically it made a lot of sense given the backdrop of what happened last year, with the coronavirus, given the opportunity and seeing the growth opportunity coming out and the strategic shift of near-shoring where we're bringing magna manufacturing back to north america, i couldn't help myself but to reach out to pat and pat, it makes to much sense to bring these two strong companies together to create something we otherwise would never be able to create for our customers or for our shareholders apart >> yes. >> and pat saw that. and so those discussions began in earnest and became serious, during the last quarter of last year, and have developed to the point that we're able to share this exciting news that we did with the markets and the customers yesterday. >> precision scheduling of the railroading, a term that a lot of investors have become familiar with now, you're a protege of the late hunter

harrison and using that methodology for a number of years and you've seen most of the other class one railroads adop adopt, psr into their operations including this one, and how much more can you ring out of the system >> that's part of the beauty of precision scheduling raiding, and it's the gift that keeps on giving because it is optimizing and executing, optimizing processes, and if do you that, you create a great service that is a low cost, and the natural outcome is synergies on the cost segment side but listen, this deal is not driven by synergies. that's the beauty of it. the power of this deal is actually about revenue synergies. growth synergies and the benefit, sort of the cherry on top is actually the cost synergies, too, but again, the synergies we've talked about, 780 million for our combined shareholders, and three quarters of that's growth synergies, enabled by this network, with new revenue

markets, and about a quarter of that is operational synergies. that's a natural outcome again, of how we run our business and i would suggest that both, both the growth synergies as well as the revenue, or the cost synergies, are underestimated in fact, and i'm firmly convicted in our ability to meet those expectations but to exceed those expectations. >> mr. cree. will, david faber. clearly regulatory approval here is going to receive great scrutiny and a key question for the success of the transaction and i wonder, i know ksu had an exemption from more stringent 2001 merger rules given it was the smallest class one railroad but that's 20 years ago and i guess there is a key question as to whether the service transportation board is going to continue to honor that exemption today. is that your belief? >> that's a fair question, david. we do believe that they will i mean the law says, unless they make a different ruling that we're entitled to that consideration. but gain, to the strength of this story and the facts that

are so compelling, the standard that was introduced with the increased hurdle rate in 2001, the fundamentals here, the facts are so compelling, we would meet either standard. pro-competition. end to end connection. hand in glove. we don't overlap at all. it's all about positive score to the customer it's all about alternatives for the customer the stb exists to make sure that we provide and serve a strong rail network, that gives our customers opportunities, and options. we've got many cases where this unlocks two to three, it increases competitive alternatives, there's not one single case, dave, where it reduces competitive alternatives that's a powerful compelling story that we look for, to educate the stb on and we feel convicted they will see the same absolute undeniable pro-competition and pro-service solution this represents that we do. >> keith, jim cramer

i tried hard to get yoon union pacific to merge with ksu and the reason why, i go on business to mexico and when i look at where their route is, their routes are incredible. their routes are unbelievable for america, for where they build cars, and same goes with this mark, and they are thinking, guadalajara, and is this not the most positioned rail for the trade, the trade of autos, which is just robust and going to get more robust, for the rest of the country? right from ksu >> absolutely. and the uniqueness of our combination, jim, unlike u.p., there's no overlap, back to the concerns, we don't trigger any of those concerns. any other class one combination with ksu accessing those markets and creating this. so stand-alone, unique, end to end, there's no other railway

combination that could envision or be able to prove that point that there's no competitive disadvantage, should they join so this is the only one in natural combination and that's why we feel so convicted about the ability for it to be approved and convicted about the value that it's going to unlock and the commerce it's going to enable in the most opportune time in our country's history. something we're super excited. >> and we're having this conversation as we see all of this craze congestion at the west coast ports we're hearing where rail cars are not able to get where they need to get in a timely fashion. and obviously chicago continues to be one of those pain points for rail networks around north america, i realize you will bipass chicago with the connected network, but the case you're laying out, is this going to, create a situation, and i realize that there are these rules in place, around consolidation, but is this going to create a situation where other rail mergers may feel, may start to present themselves in the market here?

>> you know what i can't speculate on that. but i am well versed in the hurdle rate, and i would suggest that any other type merger that might be considered would face a very challenging regulatory hurdle to overcome, to be able to represent pro service, pro competition. >> we have to leave the conversation there so many more questions we hope you come back and join us again soon. congratulations again. >> i would be honored to. >> on the deal keith creel, appreciate the support, you guys have a safe day, take care. >> thank you, morgan. let's get to rick santelli now. rick >> you know, right now, we are looking at the treasury complex quote-unquote, air quotations, easing back a bit. but easing back a bit, when we're still hovering near 170 for 10s and 2.40 for 30s is not a big retracement: the intra-day high, you can see the two-week chart of 10s and 30s there and

definitely pulled back a little bit but only down several basis points and we are still at, as the next chart show, basically near the zip code of the highest closing yields in 10s, going back to january 2020, and it is a global phenomenon. here's the 10-year for the u.k hovering just above 80 basis points these are the lowest levels since the summer, or excuse me, the highest levels since the summer of 2019 so we could see that the price drops and the yield increases, it is something going on in all sovereigns and a year to date, now chart of barclay's. this is the investment grade security side. and the spread side. and we were hovering well below 100 and now just well at 100, to show that spreads have widened a bit. but to call 99 and change, wide, really is going in the face of history, and if you open the chart up to five years, you can clearly see what i mean. but we do want to watch, you know what, interest rates when they're this low, and then they

bounce, why take the added risk of being in corporate, of course, when you can just be in treasuries which are safer, that seems to be the logic, and finally, the year to date of the dollar index, from january's low, which is the lowest close since april of 2018, and the dollar index has a very solid march going. jim and david, back to you >> thank you, rick rick santelli with the bond report. well, let's get a check on where we stand, in today's trading, as you can see, the nasdaq is the best performer of the three averages, up over half a percent. we're back in just a moment. ♪ mom and dad left costa rica, 1971. and in 1990, they opened lrazu. when the pandemic hit, pickup and delivery was still viable.

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they had a deal there, kept waiting, jim, for chinese approval it didn't come at least by the deadline they were hoping. >> and we have seen those deals come and go.

but what's important is they added a $7.5 billion buy back. people have to understand, the shortage in chips, a lot of it is in transport. a lot of it is double ordered by china. a lot of it is you can't get the machines applied materials keep an eye on kla and the best one, these are all the companies that make the most money in the cycle because boy, david, these companies are so in demand, their product, and the shortage continues nothing is going to alleviate it. >> you don't think so? qualcomm ceo steve won't be ceo for much longer. >> you need china to stop double ordering they're working 24/7 they were not for a while. i believe there's a fire in a japanese factory this weekend, the way you play this is apply

materials, kla, asmlf, and best of all, lamp, the fact that the deal didn't work is amazing. they're buying stock. >> that has been, wow, i mean, again. >> great stewards of capital >> yep >> tremendous stewards of capital. >> all right what do you got coming up on "mad money" tonight. >> we have a rival i don't know if you know our rival. ev truck and then biohaven, for those who suffer from migraines, this is the answer people may not know it, but it is growing incredibly fast, worldwide, and dr. coric has t done some great things they did a secondary that was bad. it was passed on >> have a good rest of the day. >> how can this be the show? >> this is it. we've got another one tomorrow. >> it's beenike lfive minutes. >> we have another hour of "squawk on the street" coming up don't go anywhere.

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good monday morning, i'm david faber along with morgan bren

brennan and mike santoli you can see we are up across the board, the dow had been a laggard for a bit there. the nasdaq surging almost,well let's call it .8%. getting close to 1%. broader gains across the market, in particular, many of the growth names that have seen significant falls of late, at least making up a bit. apple is up over 1%. facebook adding to a recent rally as well. we're getting existing home sales data, and let's go to diana olick for that right now diana. >> david, existing home sales in february fell 6.6% to a seasonally adjusted annualized rate the street was looking for 6 1/2 million. that's a pretty big miss and january's numbers were revised lower. sales up 9.1% year over year the problem continues to be supply or lack thereof it. supply fell 29% year over year that is the largest drop on

record to just 1.03 million homes for sale that matches january's record low and it is also a two-month supply at the current sales pace a balanced market is considered a six-month supply lack of supply pushing home prices up. the median existing home prices, up 15.8% year over year. that's because the high end is sailing, million dollar plus homes, up 81% year over year those priced between 250 down 11%. no supply in the market at all, david. >> diana, thank you. let's go over to mike santoli as well it's interesting, we are close to the anniversary of the lows that we saw in the stock market last year, and it was a great time as we know now to buy it's funny, jim had brought up pinterest shares and snap shares he's almost 500% gains in some of these names over the course of the year but many of the growth names seeing at least a

little bit of vitality today >> yeah, i mean, it was indiscriminate the selling a year ago, and really historic in terms of proportions not just a 34% loss in the s&p over five weeks, which was the steepest ever, even if conservative investor, if you had 40% of your none in bonds, you were down 20% or more at that low that was the fourth time in post war thifhistory. it was a great opportunity if you had the stomach to rotate back into equities now, massive contracts we have one of the five best 12-month performances in the s&p in history it's up 70%. it's only been four or five times since world war ii we have been up 50% or more in one year what's happened after that, it's not necessarily been a major peak in the markets. it's been a sideways period following that like 2010, a period during 1998 even and going back to 1983. after the first burst of a bull market, now also, the real

damage is in bonds, the annualized decline, and the aggregate bond index, would be the worst year ever. would you rotate into bonds or find some other way, guys, to try and figure out what the right mix is right here because really, the argument for further increases in yields fundamentally seems pretty airtight at this point. >> that's exactly where i was going to go with you, mike, because the journal over the weekend has a big write up the returns on investment grade corporate bonds from companies like amazon having their second worst start on record, speaking to what we are seeing play out and sort of this rotation. are there any signs, do you see any signs of worry within credit right now? or is it, you know, just basic rotation and sort of steady as she goes here. >> interestingly, the concerns are not about credit quality or solvency the reason those bonds are perf performing poorly, basically like treasury is because there's

been so little concern about credit, they traded it in terms of yield to treasuries, that is the risk if you're investing in bonds. there isn't that much of a yield cushion relative to treasuries the only thing you can say, bonds oversold, and due for some kind of, we're seeing a little bit of a moderation in the move right now. so it's not about credit because the economy is probably going to bail out a lot of indebted companies even if things don't go well. it's much more about what yield you're going to get and how much risk you have in that kind of a portfolio. in fact, we can talk a little more about all of these market issues right now joining us are is morgan stanley investment management and senior portfolio manager, and destination wealth founder and ceo. good to have you this morning. you heard the conversation andrew, let's start there, what are your expectations in terms of the pace of returns, in terms of what an investor taught to do in terms of tilting one way or

the other at this point? we have obviously seen this massive run in value stocks along with the rise in yields. >> yeah, i mean, look, i think what you said is all right, michael which is second year of a bull market is just a little tougher than the first year. there's a little bit more volatility and volatility can be used to your advantage to invest and to be patient, waiting for bigger pull backs, but it tends to be a pretty good year i think value has done very well here, and growth is over sold, so i think we're getting a bounce in growth stocks, but in my opinion, that's an opportunity to reload on value names because i think, you know, fed chairman powell has been pretty unequivocal, all about the unemployment rate, getting unemployment rates down. i think rates are moving higher, and you know, coming out of a recession, you tend to watch value cyclical stocks, and they are doing exactly what they normally do coming out of a recession. that is not over yet.

>> what about the idea that you're starting to hear a little more out there that value has become momentum, a little bit of a consensus trade. it's no longer early in that move. >> it's not. value stocks got very very cheap in a recession they've repriced about halfway back to normalized, you know, levels of cheapness. but we're not there yet, so yeah, the big, the fact that was earlier but i don't think it's too late, and i think a lot of people want rates to stop going up because they're over weight in growth stocks i think there's a lot of talk about liking financials. but i don't think as many people are overweight financials as like them, because i think they, you know, growths in the winter. that's going to clearly have a higher weight in people's portfolios. >> do rates stop going up from here, at least in the near term. we can have the conversation about treasuries being oversold. what do you think? >> first of all, i agree with

what mike said about his term super oversold, i think that's a great way to say it. do rates go up i think rates are going to moderate i think right now you're seeing a reaction because of uncertainty, what's going to happen with the stimulus how much is going to juice the economy. but we're still targeting the ten-year yield of being around 1.6 at the end of the year i think they're probably going to drop a little bit from where they are now, and i think that for an investment, from an investment standpoint, if you're rotating out of stocks, and i agree with what you said regarding value stocks, dividend stocks, make a lot of sense. if you're rotating out of equity, and moving into bonds, because what else is there, i guess crypto, cash, and bonds, you don't have to necessarily go to longer fixed income, something with a duration. you can maybe hedge a little bit, or maybe a three-year duration, 3 1/2 duration, so that way you don't have as much

risk, if what i just said, rates go up, if they don't go up, at least you have participated in pulling out of the equity risks and getting higher yields in money markets. i think there's a constructive way to invest for diversified strategy. >> what do you think of crypto, michael? >> is there room in a portfolio? albeit maybe slim a little bit, but is there room in a portfolio for crypto, as a hedge against inflation or rates going higher? >> i don't know that there's any information for me to make it, if it's the place to be. i tend to buy things that i understand and i must confess though i understand what crypto is, i'm not completely clear what moves crypto beyond just whatever is happening behind the scenes, so it's not something in portfolio strategies but by the same token, to go on your point, as opposed to fixed income, i don't know that you're necessarily out there buying tangible assets either, whether

it's gold or copper or silver, whatever it might be i think your bond equity mix is probably your best bet. >> finally, andrew, you mentioned earlier that you think longer term yields have up side, in part because the fed has told us they're going to be keeping rates at 0 for a long period of time, that's a little bit of an upside down relationship relative to what we got used to. in other words, dovish fed policy, implies higher yields in that equation. does that not mean that the market is going to have these periodic scares about inflation if that's the case >> absolutely. absolutely >> i mean, one of the reasons why growth stocks are so up from value stocks over the last decade is that every time the economy started getting going, the fed has changed policy and taken the punch bowl away, and i think what they're saying, so that's ended the value rally bank stocks can't get going because it stops the yield curve. i think what the fed is saying

is they're changing their positioning. they're going to let the economy run hot because that's not the priority is the unemployment rate, and that scenario, i don't think value stocks will run out of steam anytime soon because the fed is going to let economy run hot, and that's going to push rates up, yield curve will continue to steepen. so i'm definitely, i'm an equity guy. i'm in the camp that we're going to see 2% on the ten-year a lot sooner than most people think because that's what the fed is saying they're fine if it happens. >> yeah, and of course higher yields, higher inflation benefit value stocks historically, andrew, michael, thanks a lot for your time this morning. a deal to get to this morning. canadian pacific acquiring kansas city southern, we spoke with canadian pacific ceo last

hour in a first on cnbc interview, here's what he had to say. >> at this historic time, northern american trade has never been more important than it is today. so again, how can you not do this now to create an economic backbone, a network that can serve as the backbone to drive the growth for the stake holders. it's pro competition, pro service, pro for customers, employees in the north american economy. and of course it is that implementation, of something called precision scheduled railroading, which is in place at canadian pacific under keith creel who is a protege of hunter harrison, and something being put in place in kansas city southern network as well, and that of course, if you see that across, we talked about this, across this north american combined network could help to increase service, increase productivity, and efficiencies, and maybe ring some of the costs

out. but overall, david, this is really less about something like, for example, cost cutting and more about growth and realization of greater revenues, i mean, management talked about he talked about 780 million of annualized synergies within three years and it is much more a play on economic growth, economic recovery, and more goods moving around the rails. the ability to take truck tonnage off the road potentially, too, with the efficiencies that this creates. >> in the interview of course he did seem to indicate that they can exceed those synergy numbers. i thought that was interesting, morgan, sort of indicating that. and of course the other key will be the regulatory review that this receives from the service transportation board i'd asked about the exemption from tougher merger rules that did not apply or was exempt at kansas city southern as of 01. that's 20 years ago, mr. creel

feels confident this deal is going to pass muster, it's pro competitive because there's no overlap. >> and it is worth noting that these are the two smallest class 1 freight railroads and even combined from a revenue standpoint they will continue to be the smallest. but there's a very broad expectation here among investors on wall street as well, that while it will be a long and probably in-depth regulatory review by the service transportation board that this will ultimately get the green light. i'm already seeing the notes out there, analysts like those at citi suggesting those could actually, based on the argument he laid out this morning, trigger more potential mergers keep in mind, we have seen so much consolidation in the decades past, and there are tight rules around what could possibly happen now, but there is speculation already bubbling that a canadian national, for example, could maybe do a deeper tie up with an eastern railroad, like a csx or norfolk southern

i don't know, we have seen these things floated around in the past, mike, we'll have to see what happens. >> we have seen in the market as sort of positioning for it, you know, deals do beget deals when the economic tail winds are right. we'll see how it goes. hear what elon musk is saying on privacy from the china development forum, plus blink charging up 26% in the past year n'gowaspeak with the ceo dot ay. with a bang, energy and change came to every part of our universe. seismic or small, it continues. change is all around us. shaped by technology and human ingenuity, we can make it work for you and your business.

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welcome back, new data out from astrazeneca's covid-19 drug trial. m meg tirrell is back and joins us with the details hi, meg. >> these were highly anticipated data the 30,000 person phase 3 trial of the astrazeneca trial, 79% efficacy overall in preventing symptomatic disease. they say 100% efficacy against severe disease and hospitalization. we learned this morning they had five cases of severe disease among people who got the placebo and none among people who got the vaccine. they saw no vaccine related safety concerns and appeared to be well tolerated. they specifically looked into the risk of blood clots given the concerns in europe, and said they did not see that. people note that is a rare event and you might not see that in a trial even of this size. we heard from the president of astrazeneca's u.s. business that they plan to file for an emergency use authorization in the first half of april and if

this goes along the same lines of timing to an emergency use authorization if the fda gives the green light, about three weeks later we could see this on the u.s. market. at that point, though, we'll have a lot of other vaccines available as well. we asked dobber what role this could play in the u.s. here's what he said. >> we assume that the approval will take place in a fast way. we hope to deliver 30 million doses instantly after the eua for americans to get vaccinated. i think it's incredibly important despite the progress we have seen across all vaccine producers, that there's still a need for more vaccines in the united states but clearly also in the world >> in terms of that supply, dobber says they would have 30 million doses in the u.s. upon emergency use authorization, 20 million more ready to go in the same month and monthly, 15 million to 20 million doses going forward in the u.s and guys, we've already talked about loaning some of those

doses to canada and mexico so it will be very interesting to see how this astrazeneca vaccine fits into the landscape in may when dr. gottlieb expects that we could be having enough supply to perhaps even choose which vaccine we get guys. >> that's exactly the thought process i was just having, meg, when i see a projected rise in output, should be enough to fully vaccinate 76 million people in march, 75 million in april. 89 million in may, and this is without astrazeneca, i do wonder whether, and to your point about loaning some of the doses we have already essentially reserved to mexico and canada whether this becomes a vaccine that we now start to export to the rest of the world in a more meaningful way because we have so much supply. >> it could be, and there are elements about it that make it more easily usable around the world. it can be stored in the fridge for up to six months so it's just an easier vaccine to transport and to store and to

administer those ways similar to the johnson & johnson vaccine. we have others that might be coming behind as well. novavax, the original goal was to have a lot of different vaccines in case some didn't work or there wasn't enough supply now we might end up having more than we can actually use we'll see how the country deals with that. >> this is unprecedented meg tirrell, thanks for joining us mike. >> all right well, now for our etf spotlight, taking a look at the spider regional bank etf, ticker, kre, up 30% this career alone on pace for the best first quarter and start of the year ever one of the top ten holdings, huntington bank shares helping to move higher, up nearly 25% this year so far, and we'll speak to the ceo in just a few minutes. "squawk on the street" will be ghback ♪ ♪ (upbeat music)

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data with the cars or the u.s. raising its price target for tesla talk to $3,000 a share the stock move already as no, ma'am call over the past 12 -- astronomical over the past 12 months making up more than 10% of the fund, but mike, i think the comments about tesla's data and the security of that data is particularly important especially given the fact that you did see the chinese military last week ban tesla cars from entering its complexes they cited the security concerns over the cameras installed in the vehicles in some ways, it kind of echoes some of the u.s. clamp down on chinese hardware, and products made by chinese companies but there are two key differences, i think, to all of this. the first is that in china, you have something called military civil fusion, which basically suggests that the chinese military, the chinese government could come in and claim access

to essentially technologies that its commercial companies create and export to other parts of the world, so right or wrong, that has been part of the debate on that side. we don't have that here in the u.s. obviously, and also tesla's factory in china is 100% owned by tesla, which is a very rare situation as well. so they are very much their own autonomous facility there. and you got to think sharing with any government is going to be bad for business. >> it's always hard to really figure out if there's legitimate security concerns, if it's a little bit of a maybe just to keep the foreign-owned company, the competitor to many ev companies in china a little bit on the defensive and of course tesla's collection of data, but like driving data and general kind of driver behavior type data is a core piece of what arc has always

said about the kind of proprietary value of tesla's vertical integration that's going to help them with the ai to have self-driving cars. tesla probably isn't in any hurry to share anything if that wasn't an issue in the first place. we can talk about the rest of the $4,000 target. >> i have to say my favorite back and forth with elon musk over the weekend was his response to bernie sanders saying he's quote accumulating resources to make life multiplanetary, and extend the light of consciousness to the stars, david, in response to the comments from senator sanders around his wealth, so i guess burn for the burn. >> to the stars. >> it's a space reference. i had to >> of course, i would expect nothing less one gainer from the ev boom is the company charging supplier, blink charging, its eye popping 2,700% jump in the last year has certainly attracted, well, some

investors, and detractors as well joining us now is michael farcas good to have you with us as i mentioned, given the valuation, you have your share of those who question it you also have a share of people as well or detractors who question the underpinnings of your business model overall. let's start there. i mean, how many actual chargers do you have on your network? >> we've deployed over 15,000 chargers, totaling 24,000, but i think the problem here is how you categorize those as a business we're not a supplier of charging equipment. first and foremost, we are an owner and operator of charging stations yes, we do sell charging stations to others our main business is to partner with property owners and deploy in their locations under long-term exclusive contracts where we own the charging stations and our profit is going to come from the future in the sale of fuel, not necessarily

the sale of the hardware we do generate most of our revenues from the sale of hardware we make an amazing piece of equipment. our real business is really selling fuel and that's going to take place in more volume obviously when there are more evs on the road. >> and getting those utilization rates up back to charging stations, you say you have over 15,000, but even there i know there are people who say that creates a false impression because a lot of these are residential chargers they're not networked and they're not accessible is that, in fact, the case and that actually of that 15,000, there's about 8,100 or so that are residential stations that are nonnet worked. >> that's correct. when we talk about deployed charging stations, we talk about all charging stations that people can use in actuality, the combined amount of blink, and we have deployed over 24,000 charging stations, but today out there in the field, there's 15, 16,000, and you're correct, a lot of them are for residential

purposes, network, and nonnetwork charging stations for the market, and in addition, we have charging stations in i kia, whole foods locations, burger kings, mcdonald's, literally across different industries. our plan is to grow our business in tandem. >> let me understand, though, if a charging station is in somebody's garage at their home, likely not going to use it i mean, how is that going to contribute to profitability given utilization rates the key for the business. >> that's correct. utilizations are the key single family home chargers, yes, those are chargers that are deployed they do not bring us recurring revenues although, when you do buy one of our home charging stations, you typically get a credit for our blink network. you access the blink mobile application, and people who use our charging stations are more inclined to go out when they need additional range to use charging stations in the public

domain one thing that's different about us and every other ev charging company that you have out today, we are the only vertically integrated ev charging structure, fully integrated. we provide a home charging station, all the way up to d.c. fast chargers, and we have everything in between, and we give a deployment model on every type of location that there is, and multiple models in being able to put out that hardware, whether the property owner wants to maintain and own it on their own, paying for everything literally from the charging station to the hardware to paying for the networking services, in addition to paying for the installation, and also we have property owners that they don't mind making capital improvements in their locations but they don't necessarily want to take the technological risk or management and run the entire offering so we have different offerings for all of our different types of property owners, and it's one of the things that separates us from everybody else we have charge point who sells hardware, electrify america who owns and operates, and we're the

only one who's able to provide a charging solution for whatever type of property there is, and whatever type of location there is with the right hardware solution. >> michael, when you talk about eventually, your business will be more towards selling fuel itself, what's your assumption about pricing, what does it do to the kind of, you know, the kind of cost benefit equation for owning an ev >> there are multiple benefits for owning an ev, and you know, elon musk has proven that over and over again that's not our job our job is to go ahead and fuel those vehicles without a question, if you're charging at home, it's a much, much -- it's lower per mile to drive using electricity than using gasoline obviously as costs come down, as we have more volume, we'll be able to lower the prices of our electricity. we're also working now on being able to reduce our cost of electricity. obviously as volume increases,

our costs will go down we're in a very great position ultimately, we plan on being able to offer the greatest prices to our customers. in addition, we're going to be offering prescription pricing, you can pay one price for all of your driving needs. >> michael, i just want to go back to the chargers themselves for a minute here. there have been reports about concerned investors, short sellers, as well that your chargers are sometimes not maintained, they're missing, broken, how do you responds to that >> very simply, when we own and operate the charging stations and their hours, we have the rights to go into these properties, and to fix those charging stations and maintain them when we sell into third parties, we have no control over that after the warranty period. in addition, we have bought some of these companies at a bankrupt ri s they have prior management, rewarded not based upon where demand is going to be or the best locations some of those locations are in disrepair but those are charging stations that are not owned by us it would be like faulting every

auto company for every car that's sitting on the street not in perfect order it doesn't work that way unfortunately by owning and operating which is our main model that gives us a lot more control in being able to make sure that those charging stations are in operating order. every charging station that blink owns, we go ahead and make sure it's in operating order, and we swap out older units that we own and operate, as soon as they're in nonworking order, swap out rq 200, the best level two charging station on the market we're having little issues with the charging station, it's been built by a tier one contract manufacturer, designed with our specifications, it is the fastest level two charging station. >> you mentioned that. third parties are manufacturing your charging stations you don't have your own factories manufacturing. >> does apple manufacture their own goods? fox con makes apple stuff. >> right >> i'm just asking because you continue to say -- >> most companies, with all due

respect, most companies outsource production of their goods today. we are working on having local u.s. production for all hardware that we're going to deploy in the united states. we take, you know, the current administration's offerings into consideration and we're looking to make sure that the hardware that we have here is made here and we're working on everything that we can do but again, we're going to work with partners who specialize in manufacturing, you know, we designed the units, and to our specifications, and they're built specifically for us. they cannot be manufactured for anybody else and these designs are what's now allowing us to have amazing traction in our level two charging stations and what we did for our level two charging stations, we're now working on developing a d.c. fast charger that will have integrated energy, storage, and will be a lot more economically priced. >> michael we're almost out of time final, i mean, are you going to need to raise more money, and you had, what, 5 1/2 million in

revenues you sold stock recently. is the company going to be in a position to fund itself or are you going to need to go to the capital markets? >> we were fortunate to be able to raise almost a quarter of a billion dollars in january, and from an equity standpoint, that's enough. if you look at the market we're in today, the u.s. has about 3,000 viable charging stations by 2030 we need between 12 and 14 million charging stations for us to own and operate as many as we would like to, it's going to require additional capital. we believe we're going to be able to work on having more infrastructure take financing with very little or no dilution the industry is changing there's a lot more faith in the industry, and i think there's a consensus that the future of mobility is powered by electricity. >> which is why we wanted to have you on. michael, we're absolutely out of time, but certainly appreciate your taking it with us as well thank you. >> thank you for having me you're welcome. >> it's time now for a covid update rahel solomon has that for us.

good morning. >> as more americans get vaccinated the demand for travel is on the rise for the first time in a year, more than 1.5 million travelers made their way through airports in the u.s. fin a single day. it's the 11th straight day of more than a million travelers. and highest number of infections since november total deaths are near 160,000, and total number of infections has swelled to more than 11 pnlt 6 million. that's the high -- 11.6 million. that's the highest in the world next to brazil and in an effort to enforce social distancing, it has imposed a curfew from 11:00 p.m. to 5:00 a.m. brazil is grappling with the second highest covid-19 death toll in the world and according to johns hopkins data, brazil also leads in new daily infections with over 90,500 at airmed cases on friday. th's new record high for the country.

"squawk on the street" will be right back

welcome back, regional bank stocks on the rise, the regional banking etf outperforming the s&p, steve steiner, huntington bank chairman president and ceo joins us now thanks for being with us >> pleasure, thank you >> a lot of debate given the move we have seen in the steepening of the yield curve as of late about economic growth versus possibility of economic growth that triggers inflation, just in terms of what you're seeing in your different segments of business right now, how would you rate the economy and the recovery that's taking root >> the recovery is clearly continuing we thought it started the second half of last year. it's gaining momentum. the multiple stimulus packages, the vaccination program, which is going extraordinarily well.

i think it's opening up the economy, in a very significant way. i think this year's gdp growth will outperform what was expected a couple of months ago. with that, i believe there's low end wage inflation there's inflation in commodities, and certainly on the lumber side, for example, the housing package for lumber is almost 2 x what it was just six months ago so there is inflation for me in different pockets, and i think that will be a challenge at some point in this recovery for us. but i don't think it will be that significant this year >> do you think the yield curve continues to steepen from here i mean, i realize we had that fed meeting last week, and a lotovlof back and forth, particularly in the market on the heels of that about the dovish commentary we got from powell, versusa stronger economic forecast how does that play out within the bond market? what does that mean for your company? >> well, i think rates will

continue to move up a bit. certainly in the medium and longer term. but i don't think this is a run away scenario item for us, that's positive. the slope of the curve really matters, and although short rates, overnight rates are continuing to be very very low by historical standards, that slope is helpful to our industry, and certainly to us at huntington >> what did you read about the other aspect of what the fed did last week, which is kind of lifting this regulatory relief about fed ownership of treasuries and, you know, perhaps it creates a challenge because there are some in the way of reserves and banking system banks like yours are being flooded by deposits, and maybe struggling to find a place to put them does that affect you, and how do you think it's impacting the overall financial plumbing at this point >> i think the industry is incredibly liquid. i've never seen this in my 40 year career, and so there's a lot of excess deposits sitting

at the federal serve or in short instruments like treasuries, and we're talking, you know, many hundreds of billions of dollars for the system as the economy continues to open up, however, i believe loan demand will increase and with that, some of these excess reserves will get socked up, just to support expansion mp for us, we're in a manufacturing, the midwest is a manufacturing zone the manufacturers are doing well, by and large many are, if anything, supply chain constrained at the moment or labor constrained, which we hear universally there's a lot of opportunity in front of us, at least in that sector, and we had some great home building numbers today, and that would certainly be true of our region as well. >> obviously, steve, the comeback in the economy, and all the stimulus really helped to prevent a bigger credit issue for the industry and obviously the loss experience in your bank has been

manageable i wonder if there are any other shoes to drop potentially f you're looking at things like the eviction moratoriums expiring, and mortgage forbearance and anything else that you think is building up in the system whether commercial real estate perhaps that you have your eye on. >> look, well there is things, i don't believe, that will be an immediate impact i do think, for example, foreclosure moratorium the right thing to do for many of these situations will be to work with customers and try and keep them in their homes, keep their families in their homes, and provide extended repayment terms or meet other forms of accommodation. the job market recovery is extraordinary in many of the midwest states i'm familiar with i think that would be true nationally, and the vaccines, i think, will open it up in terms of hotels and restaurants and other forms of employment for people, so i think we're in a very solid footing, and some patience and working with attitude, which i think the industry, the banking industry

demonstrated last year will continue and that will abate some of what otherwise might be a more challenging moment. i do think there will be evictions and foreclosures and lease evictions but i don't believe it's sort of a significant wave of this in the offing, and i believe the banks will generally be very constructive and work with our customers. certainly we will. >> steve steiner, thank you for joining us today we appreciate your insights. >> it's a pleasure. and as we head to a braeak, getting a check on the airlines, they're all trading lower this morning. take a look, jetblue off by more than 6%, despite the cta saying it's screened the most passengers in more than a year airlines is a group up 30% year to date coming into today. "squawk on the street" will be back after the break oh yeah! honey, you still in bed? yep! bye!

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a long time market forecaster believes treasuries are ready to rally check out tradingnation.cnbc.com for more more "squawk on the street" ahead. the aflac post-pain show! aflac! we are back with steve, who's got two broken arms and one unexpected medical bill. i mean look at this guy, he can barely open his bill! aflac! let's look at the re-pain replay. lost the dunk challenge, the use of his arms... and his dignity. aflac? aflac would have been the smart play. they pay cash directly to help with expenses health insurance doesn't cover.

should we give him a hand? get help with expenses health insurance doesn't cover. aflac! official partner of march madness. welcome back to "squawk on the street," i'm dominic chu, stocks are slightly higher, actually towards the highs of the day right now, to start off the week, led by gains in the technology sector, up 1 1/2% among the leaders are a mix of names ranging from adobe on the software side, payroll software maker, and the megastocks, technology are holding up well, though not quite back to their highs from earlier this year microsoft was less than 5% away from its mid february records while apple remains around 15% below its high from back in january as well. so keep an eye on those mega cap tech stocks, morgan, and we'll send things back over to you guys. >> i feel like we're always keeping an eye on them, dom.

>> shipping backlog an issue over a year into the pandemic. we're going to discuss what it means for the consumer and your wallet, next

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welcome back to "squawk on the street." our next guest says with the ongoing shipping exports and growing consumer demand, company's bottoms line, impacted and joining us, thanks for being back with us. >> thanks for having me back. >> last time you were on talking about basically unprecedented leveling of congestion and backlog, gridlock at the ports some of the most recent high-frequency data points i've seen suggested maybe the worst is over, but given the fact you are uniquely positioned within these supply chain dynamics, what are you seeing? >> yeah. well, it does appear that things have gotten a little better, because way less ships are waiting off the shore at long beach than the largest u.s. container port down right now only about 19 ships at anchor waiting to be unloaded that's down, lowest since

december 21st. actually might be a false sense of hope, that really what happened here is that there are less sailals during lunar new year when china takes a big holiday, so less ships were coming, but about to be more and backlog will grow again. right now taking around 30 days to get, just to get -- once unloaded at the port, to get on a train. about 45 days if you're going to texas, because of the snow pop infrastructure, not ready for a surge in growth. >> i mean, it's bananas. you're talking about now, it's bananas. speaks to shortages i think consumers are seeing when they go into the stores on shelves

looking for different types of goods for different parts of their household or daily lives. is the expectation that this begins to ease at some point and then it's a flood of inventory, or are these tight capacity constraints something here too stay? especially if economic growth will fire up on all cylinders? >> it's hard to predict. probably the biggest lesson from all of this pandemic for everybody. predictions of the future are super hard and better to be ready for anything as a technology company we manage global shipping, for about 10,000 companies on our platform what you see is first off they are experiencing much higher prices actually right now if you're signing a contract to book ocean freight, you're paying about three times more on just the port-to-port ocean leg than you were last year on a door-to-door basis, sort of

1.5 to 2 times more because the price of customs clearance and trucking and other fees in the journey have not gone up nearly as much. that's the first thing what customers that we talk to are saying that they are having to pass that through not the highest cost businesses in the world and can't extend than without passing it on to the consumer that's about what consumers do from here, how it plays out. last year the reason imports were up so much, my thinking is, just because you couldn't spend money at restaurants and on travel or hotels and such. so people just bought more stuff. >> yeah. >> so there's a huge increase in imports. >> people bought a lot of stuff. ryan, you mentioned infrastructure passage of an infrastructure bill and money available, would there be a need and whan is the capacity at ports? >> something we've talked about for years. that our port infrastructure is

lagging in the united states we're unable as a country, look at all the ports in the united states we are unable to handle the largest containerships in the world because our ports are not deep enough and the cranes are not tall enough for these big, new ships. a huge need for investing in infrastructure there i have no vision, i don't have any window if that's part of the bill or part of the plan, but certainly it's needed. >> yeah. leave the conversation there up against end of the hour at some point come back, though, talk a little what we're seeing with amazon building out its transportation network and having this conversation in the midst of a big rail merger just announced, too a lot going on in the sector overall. ryan peterson. thanks for joining us. >> my pleasure thank you all. that does it for us on "squawk on the street. coming up on "squawk alley," discussing trump's possible launch of his own social media site keep it here.

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