. good tuesday morning i'm carl quintanilla with jim cramer and david facebook. s&p looks to openber s&p looks to open -- pfizer raising guidance and will file for full fda approval of its covid vaccine this month >> plus u.s. chips intel moving ahead.

with a multi billion dollar factory plan in new mexico taiwan semi also reporting big spending stateside and it is a multi billion dollar breakup. bill and melinda gaits splitting up after 27 years. what will that mean for their enormous foundation? and a lot of other questions carl. >> interesting morning setting up here jim. i was keeping a list of the number of companies that have raised guidance today. pfizer, under armour, cummins, dupont, cvs. >> two stories i think bothering people one maybe there is so much cap exbetween the prices soon roll over i know that is something most people not thinking about but people are really focused on semis are saying listen. taiwan semi spending this much need to see intel. pat gelsinger has welcobecome te

deacon would be very bad for the semis. let's not forget historically their own worst enemy. this is the team and second theme go listen to dupont. it is a great quarter. if you read the release you will see. inflation shortages. inflation shortages. david when we hear inflation and shortages, we're not waiting for the fed. we're just selling i think it is premature. >> you do? >> i do. >> chips, shortages. >> but disease not -- >> the no. commodities up, up, up no matter what you look at. >> steel's in the plooib so the strongest grubs do you want to be led by the pipelines? >> i don't know. i continue the wonder. the yield today is actually falling on the 10 year right around one six i guess you are not concerned about inflation? >> i think inflation can take care of itself. >> what does that mean >> because a lot of the

inflation you see as clorox. >> the underlying -- >> -- build all our -- >> we talked to dow last week. >> yeah, i think if you look at the gulf that is our plastic bill nobody really went down. we should have done many stories about it everybody should have. carl, the fulcrum of inflation i know everyone wants to say lumber but that really is tariffs. lot of people want to say you are seeing inflation through steel and a that's true. steel is doing very well but prin principal inflation is plastic those plants are shut. and of course semi conductors. not because -- it is because of just in time for us versus just in case for the chinese. they have the chips. the chinese have the chips there is no shortage in china. just here. >> yeah. b of a did some work on this

yesterday. looking at the number of mentions of the word inflation in corporate earnings calls. it is up 800 percent year on year and typically leads cpi by about a quarter. b of a says but net margins are at a record and even cummins today talks about higher input prices but they raised their guidance on ebitda margins. >> raised more than you would get from the first quarter and most importantly dupont is saying look we're going to be able to cover all of the costs and more but david, when you hear that you start saying to yourself, wait a second, who's paying? who's paying for tyvek price going up the semi conductors going up who's paying is it you? is it me >> yes. >> right it's us. >> i think it is. >> it is >> so i come back to the question, why are nowed concerned about inflation. >> because inflation can be overr overridden by more

manufacturings, more -- >> so it is going to be a short-term phenomena. >> there you go. >> you are in the church of -- >> i am in the church of what's happening now. listening to chairman powell who by the way has said look we got to redo community reinvestment minorities are not getting any money. this guy is revolutionary. >> he's not castro either. >> he's not lenin. but he's a little leaning towards that side than torrid what we used to have >> he's leaning towards being a marxist is what you are saying. >> i'm trying to -- more equal >> from -- okay. >> you know, david there is such a thing as equality. and just because you want it does not make you a marxist. >> absolutely right. and it is underlying a lot of to policies that we see from the administration and from the comment we hear from the fed chairman in terms of trying to

write that ambulance that has been so off balance and continues to be. and of course we talk about it all the time for years here. in terms of -- yeah. in terms of income inequality especially. >> yeah. the outlook is brightening as you said yesterday but there are these along disparities. looking for a gdp of 13.2. which would be high. your point about inflation ford had a comment about it and they said it feels like it is all due to a lot of one-timers as the economy comes out of lockdown we're going to get some auto sales numbers. but look at ferrari today. race is down pre ree market and a lot surrounding concerns you are talk about today. >> look there is no doubt about it there is inflation. no one is denying it i lood new core on look at that stock cleveland clips. these guys are raising prices,

raising prices and they have the lowest cost in the world the lowest iron in the world lowest scrap so they are just queening money. if you want a group where the margins are expanding radically and -- costs are going down. then that is just the steals i don't want to say off the ban this market. i look at what happened last week with the drugs. they collapsed the drug stocks collapsed and suddenly there are buyers everywhere. >> you were talking about at the end of "squawk box" fooiz pfizer's reporting earnings. >> the pamt of money that pfizer's making. pfizer does have a patent. i looked at the numbers today. >> long time cfo there. >> is able to craft a story of endless buy backs. >> and they did come in above

obviously what was estimated well above and as you just saw, 12-15 year olds may soon be able to get vaccinated. >> will they >> the pfizer -- >> will they there is a cohort that might not want to. >> i would want my younger one to get. >> yeah? >> yeah, why not so many different things meanwhile in new york 80% of the people i count on the street are still wearing a mask outside which i also find somewhat strange -- i think they must like wearing masks maybe people enjoy wearing masks. the cdc said of course you don't have to if you have been vaccinated and as we all know there is no evidence whatsoever you can transmit the virus by walking past somebody on the street for that millisecond. >> it is all inside. >> and yet walk around, i was in l.a. too everybody there wearing a mask also people who don't want to be vaccinated and you have people who don't seem to want to get

back to any sense of normsy. >> if you look at our restaurants you must be vaccinated and yet i would presume the patrons believe. i think patrons believe that your server is vaccinated or had covid and there didn't need to get vaccinated that is another -- >> well your server is always wearing a mask regardless. obviously they are in inside as they should be. very different but jim, new york is fully reopening pretty soon. capacity constraints going up. then back to this subject we talked a great deal about is when are people going to return to the office in a real way? goldman sachs may want them back by june. they lot of them are up -- come back by june and if you are not back by september we're gonna have an issue. but there you see it office space leasing is falling. we continue to question just how much space will really be taken. new space. even what it will be and obviously won't be occupied by companies that are already

paying for enormous amounts of space for wh which employees are not showing up. >> i do think the big issue here, david solomon has do what he has to do right now lay down the law before in the next three weeks there is an exodus to the hamptons. >> i think they are doing that. >> yeah -- >> -- not just him it is any number of those who run these large organizations and financial services do want people coming back but you have to say june with the expectation that you get to september, if people still aren't coming back, then you have a much more serious conversation. >> the moment they come -- carl t moment they come back, the restaurants spring up, the retailers spring up. they got to come back. >> well, that's -- that's why danny was so excited to see that headline about goldman this morning. jamie diamond is talking to the journal this morning at the ceo counsel and sees limits to remote work. doesn't work great for young people

people like to hustle. baltimoring suffers. company culture suffers. echoes what he's already talked about it clear at least the large banks in manhattan, david. i don't see them turning tail at this point. >> i don't think they will i think they want their people and i comes back to you want to bring in a new class of younger people law firms we don't talk a lot about. that is a more interesting subject. most of the partners at these law firms, they never want to come back. >> that's a zoom operation >> now still you have an associate class. you need to create culture there. but they occupy awful lot of space. we rarely ever talk about them i don't know when we'll see them come back. >> much easier do. those people do not have to have contact. send me your brief. >> send mee your brief. >> different. >> comes back to this idea of creating culture and particularly for younger people who would argue want to be in the office and need to get a sense for how the place actually works even if they have been zooming for people for a year whom they have never even met in

person. >> and go to silicon valley, there's no silicon valley. people are all wfh and they love to call it wfh is just as easy to say as work from home is syllablewise. >> correct >> right >> correct. >> bloomberg and bob pisani writing this morning about the stock exchange broadening the availability of traders to come in if they are vaccinated. maybe the three of us will be talking about this on a more personal level soon. we do want to mention this news that stunned the world of business and philanthropy. bill and melinda gates decided to divorce after 27 years of marriage they issued a joint statement. both will continue to collaborate on the foundation they built they raised three children added we no longer believe we can grow together as a couple in this next phase of our lives we asked for space and privacy for our family as we begin to navigate this new life jim we're going talk to robert

frank later on this morning about some of the implications for philanthropy and for business cascade holds positions in a number of public companies and of course bill gates continues to own a slight percentage of micr microsoft. >> this is the equivalent of a large corporate divestiture when you think about a separation of assets of this size. this is not insignificant. so lot of people involved. only thing i would add because of that you might imagine is that there are people in the corporate world who have been working on this. this is not something that just happened this has been from what i understand quite some time in the making and so they are much further along in the process of actually having figured it all out than just beginning that process. >> do you think that there was -- the --

>> talk about microsoft? >> yes because he doesn't own that much. >> no. i don't think there is a connection >> yeah, okay. >> but again, obviously something like this can take years you might imagine but they are far along. my understanding -- >> -- talk about the public side, private side what happens in people's lives happens, none of our business. but i do think that it is worthite to point out that this foundation seems to be at the heart -- whenever you look at something, a problematic issue they are in there. i hope that continues, right they are fabulous. . >> his intelligence on that has been valuable. guys, we're going take a break i think here

we'll talk more about auto sales in a moment. we do want to point out that there is some -- i'm sorry i missed that in the booth what are you guys looking for? jim, dax is going to open. it is down 1 1/2 percent which i think is going to put it on pace for the worst day of the year so far. >> yeah, this is just, we're making up for the beginning of the month. but i think more importantly when you see stocks have un -- when you see quarters that are unbelievable and the stocks don't go up, what you say to yourself is well, what would drive up under armour was exceptional. >> any of this have to do with chinese flying that plane, taiwan i think it does. the market definitely did i think 40 bit -- when that was reported -- but it gets to something that is a concern and goes back to our chip conversation one we're actually still going to have as well in terms of the

chip shortage but if the chinese were to get more aggressive on taiwan. >> number one issue in the world. for the united states is taiwan. and it is not like the united states is really making a statement. and yet at the same time the europeans are getting united with us. and standing up to the chinese so i want to know, we spend a lot of time the president spent a lot of time talk about lot of things but it is time to take a statement that taiwan is not -- is not for sale. and that chinese better stay away because otherwise just seems like this is the beginning of the end of taiwan. as crazy as that is. they are making a move. >> yeah. i mean it -- it -- it's not a whispered issue, jim rex tillerson has talked about that very scenario being the biggest risk over the next ten years. we'll take a break here. it is going to be a big day for

auto sales we'll check with phil lebeau in a minute futures in red back in a minute cal: our confident forever plan is possible with a cfp® professional. a cfp® professional can help you build a complete financial plan. visit letsmakeaplan.org to find your cfp® professional. ♪♪ keeping your oysters business growing visit letsmakeaplan.org to findhas you swamped.ssional. you need to hire. i need indeed indeed you do. the moment you sponsor a job on indeed you get a shortlist of quality candidates from a resume data base claim your seventy-five-dollar credit when you post your first job at indeed.com/promo

so you're a small business, or a big one. you were thriving, but then... oh. ah. okay. plan, pivot. how do you bounce back? you don't, you bounce forward, with serious and reliable internet. powered by the largest gig speed network in america. but is it secure? sure it's secure. and even if the power goes down, your connection doesn't.

so how do i do this? you don't do this. we do this, together. bounce forward, with comcast business.

>> you are looking at it being

more than cut in half in terms of production. that is the impact of the chip shortage right now and you know that if they made a lot more of those f series, if they were able to make another 20 or 25,000, i have no doubt most of those would have been sold given the demand in the market right now. >> this is incredible, phil. i know very few days as things stay on the lot. but let me ask you something i understand that wholesale auction prices are almost retail prices has that ever happened >> yes 2005. >> if you get a certain hot model right now. that's the case. especially with full-size pickup trucks if they have a particular model with certain features, certain trim levels they will have people fly across the country in order to buy that model. boom, they buy it and drive it back home. that is happening a lot. >> that is insane. it really is and lot of what i

think is bad about the market frankly phil because we can't sustain those prices you can't sustain that eco system that's just not doable for three, six months, is it >> no. you would think that at some point we're going to see a snap back in terms of the actual sales. you have had two months in a row with sales over 18 million is it going hit a wall is it going to gradually slow down but many believe that you have got demand far outstripping supply you have day supply right now down to between 33 and 36 days depending on the auto maker. carl that is just a situation where it might continue in may but at some point the auto makers are going to say look, we're selling these as quick as we're making them. and you are going to see a drop in overall auto sales because the production is just not going to be up to the level where the market is in demand. >> and that's not -- that's ignoring what's happened to used car prices phil as we well know

here on year 2 unbelievable phil, appreciate that very much. we'll take a break here. lot of news setting up as we get opening bell in about eight minutes. if you wake up thinking about the market and want to make the right moves fast... get decision tech from fidelity. [ cellphone vibrates ] you'll get proactive alerts for market events before they happen... and insights on every buy and sell decision. with zero-commission online u.s. stock and etf trades. for smarter trading decisions, get decision tech from fidelity. sure, about this? experience capability, crafted by lexus. we're good. the remarkable gx and lx. get 0.9% apr financing on the 2021 gx 460. experience amazing, at your lexus dealer. wealth is your first big investment. get 0.9% apr financing on the 2021 gx 460. worth is a partner to help share the load.

wealth is saving a little extra. worth is knowing it's never too late to start - or too early. ♪ ♪ wealth helps you retire. worth is knowing why. ♪ ♪ principal. for all it's worth. new projects means new project managers. you need to hire. i need indeed. indeed you do.

the moment you sponsor a job on indeed you get a short list of quality candidates from our resume database. claim your seventy five dollar credit, when you post your first job at indeed.com/home. a lot's been blamed on futures weakness this morning. whether it is geopolitical about china taiwan and others we'll get the opening bell in about four and a half minutes.

t-mobile is the leader in 5g. we also believe in putting people first by treating them right. so we're upping the benefits without upping the price. introducing magenta max. now with unlimited premium data that can't slow down based on how much smartphone data you use. plus get netflix on us, and taxes and fees included! you won't find this with the other guys. in fact, you'll pay more and get less. right now, pay zero costs to switch! and bring your phone -- we'll pay it off! only at t-mobile. what happens when we welcome change? we can make emergency medicine possible at 40,000 feet. instead of burning our past for power, we can harness the energy of the tiny electron. we can create new ways to connect. rethinking how we communicate to be more inclusive than ever. with app, cloud and anywhere workspace solutions, vmware helps companies navigate change.

faster. vmware. welcome change. let's get to a mad dash this morning with a minute and a half to go before we get to an opening bell

>> up grades boeing from sell to hold i read it, i want to sell boeing nine ways to sunday. it is so negative. and the line that really caught me is we see max production obviously that is the troubled airplane max production deliveries back to pre grounding levels by the end of 2025. i'm supposed to buy this you don't want to own it but you don't want to sell it. boeing is creeping up. and what's going to end up being a savior is i think the opening of europe because they need to sell the wide bodies i think they are going sell a lot because i think there is going to be happy days are here again trade in europe and that is going to happen soon. >> you were lot about china -- >> i don't see -- >> -- market for that. >> but the dictator xi would rather cut his nose off to spite

his face i don't see him acting like any leader we've seen since mao. carl i got to tell you i look at the china situation, i think about it every day because where's -- where's our power? what are we projected? we didn't believe they were going take over hong kong and they did it. something i worry about every day. >> yeah. probably not a p coincide jim that the first foreign leaders to visit the white house were -- are going to be japan. i think south korea not far behind trying to build some kind of partnership as we look at that picture long-term there is the opening bell at the nyse and the nasdaq. jim we haven't got to some of the individual numbers fair to call under armour a blow out number >> yes absolutely and just as important i remember when the justice department and sec everyone was going after kevin plank and i think it is important to people know will

the of people said listen -- and came back the next kay and i said i think the guy is completely innocent. he was completely vindicated there was no restatement but the thing so interesting david is the stock should be up 10 percent it's down. >> it's down yeah >> it was a great quarter. >> you have been saying that a lot. great quarter. stock shouldn't be down? what's happening >> okay. what is that reflective of >> i think -- reflective a big run. reflective of consolidation. with have to rethink what's going to happen because we're -- we just feel like it has to be there is too much inflation and you can't have a market led by al woe what and letter x it doesn't work david. >> because it's small

-- >> -- actually u.s. steel is up to 6.7 billion. >> stop it. >> no i'm not kidding. >> you are in that world of godfather. >> -- if you bought it you are extraordinarily happy but it is a tiny company. >> the one to buy. i had'em on last week. i goat got to tell you cleveland cliffs if you are in the cyclicals. >> they are a company that's got the lowest cost. this stock should be much higher it is not leadership but i do think in this moment it is right. and we got talk pfizer for a second. >> we do okay no i was going to just ad one more. >> whatever you want i don't care i'm not wedded to pfizer. >> do you still want to buy a

lot of these commodity plays freeport fcs, have you looked at that stock? >> it's a triple from when. >> it is a triple. up 347%. >> i know. >> 56, $57 billion market value. >> because there is no other copper company they claim they are opening -- this is what's supposed to happen carl. is they are supposed to open more mines when i had caterpillar on the show the strongest part of the book of business is mining right now. because everybody needs more copper and of course replacement homes is plastic but then plastic is all part of the gulf problem with super storm eurory. >> right

>> i think people are selling pfizer because the other people selling fooiz. i'm selling pfizer because you are selling pfizer well i'm going to beat you out of pfizer. well i think that's ridiculous pfizer is doing incredibly well. but i recognize it is going to go down. i ups that and i say okay look, let'em sale it carl let'em sell it let it go down >> sure. >> why do i have to -- >> it is a -- as you point out the shares are red kind of reminds me your talking about freeport and cleveland cliffs a far cry from last summer where it was all about clorox and some

of the grossiers and i did notice that goldberg cut kroegkroger a and. >> at this point in the cycle off the sell these stocks because historically when the margin pressure inflationary environment is negative for grocers, you have to go. you got to go. and kroger has a lot to fall if you believe that. and i tend to think that it is for real that you don't want to be in that stock there is lot of food inflation so yeah. i agree with the selling there i think you take profits and kroger and take profits in ashts ns, if you happen to have them da

>> 12 million dollar market cap company. reported numbers they were strong first quarter growth margin result -- they were strong, yeah first -- >> -- tell people who it does. >> -- year over year text books and all sort of other things. >> -- colleges and -- curriculum, so many different things around college students and they continue to create their own eco system international growth i'm reading a note from piper sandler -- >> -- conference call. >> -- more than 33 percent >> and yet that stock -- >> although average -- >> that stock was up three in pre market almost down. >> so what do you make of all this >> we're in a profit taking mode >> tomorrow is cinco de mayo.

>> you seem frustrated -- >> i'm just trying to -- i don't know what to say people are taking profits. it is not a terrible thing it is what people do they have got big profits. they are afraid. they want to preserve them i think we always want to pin the tail on something. i'll pin the tail on the fact that there is some common sense happening. things have gone up very very much and i think that some people say i want to preserve it is may. there is a reason why they did that sell and may stupid thing listen, i'm up huge and it is going to be summer for tech. cyclically there is -- i've got tell you i'm looking at a company like amat go look at cha that doesn't bother me applied materials they reported an amazing quarter the stocksegg. that doesn't bother me applied materials they reported an amazing quarter the stocks -- do i want to buy applied materials at a certain point? yes. i want to buy. >> are we at that point now? >> not it --

>> got it what about apple which is down over 2% this morning and down for the year about 2.2 brkt. >> people feel the shortages are going to impact them i think the shortages at a certain point are going to be well known everybody is going to know about the shortages and then you buy i do a lot of work on dupont dupont was one of the best quarters but it didn't matter because they talked about prices and the food complex is up david. i know you are going to say to me, jim. didn't you say it is all temporary? i am saying -- >> didn't you say it was all temporary? >> your such a wise guy today? >> i don't know. am i being a wise guy. >> i think you are. >> really? are you disciplining me now? i do have to go now room. >> -- ten inflation -- >> -- yes you have -- >> -- the you have me. >> okay. good you got anything else to say about it. >> no i'm done because you have me. >> okay. >> carl he has me.

>> guys i'm not sure how to follow up on that. what haven't we gotten to jim? there's -- i wanted to ask you about a report that steefl did earlier in the week. the s&p flat to down 5 to 10 from may to october. kind of sounds like you are in that backup. >> yes i think there will be a nice rally around memorial day. we have to wait to then. the ones that are having an amazing spring are company likes lowe's and home depot. the appliances is the problem. if you go boy a new house. >> i'm not even sure you can get the plants anymore >> 6:00 a.m. is when you get the plants best. i got there 10:30. i was late >> what was your point about --

>> no i'm saying that if you want to go buy a house. >> yes. >> that it is likely they may not even have the appliances in it they may not have'em in it carl they will have dummy appliances they don't have. >> citi goes home depot 375 from 288. i think that is a street high for hd. >> i agree with that call. these companies are doing amazing. but again, they are not going to work now you have to let the sellers do whatever the heck their thing is and then you come back to home depot because they are just crushing it. and this is -- remember you got the stimulus, you have got habits that have changed david, people's habits outside of new york have changed >> yes >> etsy. one of etsy's biggest sellers are -- >> they are going out. we're going out too. >> i went -- other day too crowded. who would go in? it's so crowded. >> of course, right. nobody goes there anymore. too crowded.

>> way too crowded >> but tractor supply sells lot oftractors i got a deere tractor. >> you do? >> yeah. >> where are where >> the new place i believe bitcoin could be worth something, like land i did not cash in my bitcoin and then buy non fungible tokens. >> do you get on top of that deere tractor yourself and mow the line up a? >> you bet i do. a tractor is very primitive. it is very medieval. carl he doesn't even believe that i'm a gentlemen farmer. he doesn't >> -- and maybe -- i think david, and i as well jim are maybe disappointed that tomorrow scinco de mayo and we've gotten

no >> i see what you're doing i watch you. >> yes >> yes. >> yes i'm in jeopardy mode here. no no yes. that's a correct response. all right. let's move on. >> i just shut down my computer by mistake. >> you are in control of the board, carl. take it away. >> give me nasdaq for 500. we're down about 1%. let's get to bob pisani. hey bob. >> good morning guys and i will show up for that margarita as well and carl is right. the problem is tech stocks and its been a problem since earnings season began. let's take a look at the sectors. energy is holding up all right banks are holding up all right go further down. consumer successionry week and there is the tech.

i've chosen april 26th that was the week we really got into the heart of earnings season and the big tech names started coming out and there's been a pretty consistent decline in technology since the earnings came out that is not evident in other sectors. so on april 26th here. energy has done already. financials have done all right industrials have done all right. little weakness in consumer discretion ary because of tech heavy counties it is very consistent across subsectors of technology i'm picking april 26th as the day. the next full screen, right across the board semi conductors have been weak you go down the list apple is down 5%, for example,

since april 26th very consistent decline of about 5% in the overall tech sector since earnings seasons began in ernest i think that is the issue now. the valuation question and this gets to the peak economy, peak earnings, peak everything story and how much further can you push it that i think is really the main paradigm the markets operatingaround right now. over the weekend april data, april trading data and lot of good information. i'm very happy to tell you dividends are back we had 33 companies announce dividend increases in the month of april they do it in conjunction with earnings zero announced cuts. last year it was a debacle people were eliminating dividends, cutting dividends all over the place not a single company cut their dividend or removed it in april this year as opposed to last year 11 reinstated, including ross and tjx, freeport, estee lauder.

reinstated and some were higher than before. dividends estimated up o close to 5% this year. that's important folks people forget about dividends over earnings but lot of people care a lot about that and that is a very important company helping keep stocks up another important component is money available to buy stocks. we got the data for the flows, equities and etfs in april they were huge $258 billion in influence in equities so far this year, large infloes in the esg huge. thematic tech etfs and equity etfs in general. here is something a little contradiction, carl. april stare value down 0 p30 percent compared to march. lot of of retailers may have put money back into simple ole plain vanilla etfs and equity etfs maybe the reddit crowd is getting a little tamer these

days carl back to you >> we're seeing interesting technical levels on yields rick santelli. >> yes carl, indeed. and one of the issues that made us focus on technicals this morning was this morning's trade deficit. this chart goes back to the beginning of trade deficit numbers, january of 1992 and you won't find a bigger one than this morning's minus the 74.4 billion and consider both imports and exports were up smartly. imports over 6% do a record 327 billie a billion. and the export, biggest in over a year we can really see that the numbers are big. imports and exports. but our demand domestically and issues of supply chains

obviously playing havoc with global trade if you look at intraday, and carl pointed to 160 level being the technical area we've been discussing look what happened when we started dip blow it. yesterday was 157ish we're basically right there. this is very important we could see extra buying come in here. looking at a two week chart of bunds, minus 26 is considered their support. remember it was just, what, 30 hours ago they were trading minus 16 the highest yields postpandemic. nooinl the dollar index. here is one week and last week we touched a two month low and now we're one penny above it but believe me, the dollar index isn't looking terrific as ore currencies like the euro seem to be more in investors eyes at the moment >> thanks rick santelli. selling on this tuesday. nasdaq down about 1 1/2%

that is going to be the worst day since about march 24 heather and the dow down another 166 don't go away. that building you're trying to sell, - you should ten-x it. - ten-x it? ten-x is the world's largest online commercial real estate exchange. you can close with more certainty. and twice as fast. if i could, i'd ten-x everything. like a coffee run... or fedora shopping. talk to your broker. ten-x does the same thing, - but with buildings. - so no more waiting. sfx: ding! see how easy...? don't just sell it. ten-x it. the pursuit is on. the pursuit of outperformance at pgim. with deep expertise to outthink across multiple asset classes,

actively managing investments in the world's public and private markets. outscale, with the resources to serve 1,500 clients in 52 countries. and outlast, with long-term conviction that looks beyond today's volatility. join the pursuit of outperformance at pgim. the investment management business of prudential.

a few interesting levels today. you have the ten-year below 1.6. nasdaq is down 220 worst day since march 24th second worst day for the dax in germany. we'll keep stock oth af iss trading is getting underway. back in a moment

some say this is my greatest challenge ever. but i've seen centuries of this. with a companion that powers a digital world, traded with a touch. the gold standard, so to speak ;) who goes right back to sleep after getting an alert of an unusual charge on their credit card? you do. round the clock fraud protection. one of the many things you can expect when you're with amex.

to start we'll have a hugely strong economy well into 202 a and maybe 2023 because of $7 trillion of spending some spent, but a lot not spent. that doesn't include the new things also look at the consumer is in great shape. the consumer is going back to work the balance sheet is in great shape. completely different than the great recession. the pandemic is ending thank god for the vaccines and stuff like that. people are dying to get out to work you see it every day you are going to have a boom my reference to goldilocks is more about that if we're lucky, it will be a boom, and inflation

will go up not too much. rates go up not too much and everything will be fine. i think there's a chance it will happen, but i think the fed is going to get inflation >> that's jamie dimon talking this morning i guess it's a good thing the household balance sheets are in good shape things will be more expensive, jamie says >> i think it's terrific i refuse to make this into a negative scenario. i can't. i know the stock market is going down i get that it does happen periodically. i just have to tell you, i am not going to make this positive moment into a negative i think you have to wait for the sellers to finish. the sellers are everywhere right now. but they do get done and when they're done, you'll know it. but you don't have to be a hero. i think there are a lot of good things happening >> yes >> jim, let's get to stop trading. >> i picked up one because of jamie. bank of america. this is typical of what i'm

beginning to read. this is a bear, rigorous note. downgrading to neutral, improving outlook fully reflected in valuation that's the term you have to watch. improving outlook fully reflected in valuation i'm getting that for the semis and now the banks. this is a buy to hold on a great situation with bank of america worry about people saying you know what? all the boom is priced in. i don't think it is. but i cannot fight the tape. it's saying the boom is priced in let stocks come down and then do some buying. i do think, by the way, that there are some situations that are incredible that people just don't care about i did a piece last night about outdoor activity, a camping world reported one of the greatest numbers i've ever seen. again, people say it's fully priced i think that's nonsense. i am going to let things come down and don't want people to be heros. >> i know. a lot of us are listening to you, jim how about tonight?

>> i've got zebra. an interesting name. one of the great logistics companies and one of the greatest performers of our lifetime and richard cramer, good year. i've been waiting to book good year forever david, did you do the cooper tire deal? no, i think some of our friends did. >> yes some of our friends did. >> that is a fantastic sichx for those who like inflation watch tires. watch oils >> jim, we'll see you -- exactly. see you tonight. >> and tomorrow night. >> "mad money" 6:00 p.m. eastern time >> we're closing in on a 1% loss on the s&p make it the worst day sinc rc16th don't go anywhere.

good tuesday morning welcome to another hour of "squawk on the street. ipt carl quintanilla with morgan brennan and david faber. the market has a bit of a sell in may tone. s&p down about 1%. worst day in about six weeks factory orders out let's get to rick santelli rick >> yes carl, do remember, yields are moving down. prices are moving up stocks are moving down

and we are having some misses on data up 1.1% on headline factory numbers. not a bad number we were looking for a number up 1.4. but it is the best since january. last month was minus .8. that still may be revised. if we look at the march final read on durable good orders, we take out .5 and replace it with .8. that's a bit better. we're looking for it to remain up .5. the mid month read and up .8 on durable goods. well, consider this. last month was down .9 3.6 is the way we came into the year nowhere near as strong as that it's a positive number of. if you look at capital good orders, nondefense exaircraft, a proxy for business spending, it was up 1.2 % that's pretty good that's the best this year. we ended last year with up 1.5, and if you switch from capital

goods orders to shipments, it's up 1.6 it's mid month read was 1 .3 these numbers aren't bad on our final reads for durable goods. but factory orders missed by a bit. both exports and imports up over 6 % with the biggest deficit going back to 92 when we started counting deficits. >> ricksantelli. here are the three big movers starting with cvs. topping earnings estimates as prescriptions boosted the pharmacy chain's sales and despite a tough year, year on year comps in the retail business, i should note, cvs raised full year guidance. you can see the shares up almost 3% underarmor beating the street and hiking the full year outlook. lifting demand for sports apparel. under armour agreeing to pay $9

million to settle over accounting practices the ceo is with us at 3:00 p.m. eastern. lastly, avis budget. revenue topping estimates and the company pointed to a jump in demand and more solid pricing for car rentals. stock is down about 7.5% right now. get this it's up almost 500% over the past 12 months david? >> i did not know that thank you. another earnings mover today is pfizer. and for any number of reasons not related to earnings, meg has more for us on the quarter and what's to come david, it was a big beat for pfizer in the quarter run both earnings and revenue mainly driven by the strength of the covid-19 vaccine also driven by the rest of the business as well the company raising its full-year guidance now saying that it expects to see $26 billion in sales of the covid-19 vaccine in revenue.

up from $15 billion it previously forecasted. that's based on seeing 1.6 billion doses and orders already for this year. excludeing the vaccine, the company is saying revenue in the first quarter did grow 8% including a 5% negative impact from pricing pfizer really emphasizing the rest of the business is healthy as well. although this vaccine is just massive. $3.5 billion in the first quarter alone. now the company also laying out some milestones for the year ahead including filing for full approval which it says will happen at the end of this month. it also sees data coming up for its boosters, data in pregnant women, day in in younger kids going down to age six months by the end of the year. so potentially getting the data and then filing with the fda the company also updating on its anti-viral drugs its developing for covid saying the second quarter, a phase 2 -3 trial of the i've anti-viral started in hospitalized patients.

for the oral anti-viral, a pill, starting a phase 2 /3 trial in the third quarter with results potentially in the fourth quarter. if they're good, filing for emergency use authorize dags then in other news on the drug front, abcellera says they brought a second anti-body testing it in mild to moderate covid-19. in neutralizing all currently known variants of concern. lilly asked the fda to evoke emergency news authorization for the first anti-body because there's a combination available. because it may not stand up to the areas of concern we spoke about this this morning about the second anti-body >> it has spectacular breadth. it binds to all the variants of concern that have been identified and, in fact, it appears to bind to every variant of the coronavirus that is at any meaningful level globally.

in addition to that, it binds a region that makes it extremely difficult we believe for the virus to escape. it has the potential to have durability as a solution for covid-19 >> hansen telling us they hope to have the clinical testing done in midsummer and have the drug available shortly thereafter this would be an i've but they're also testing it as a subcutaneous shot to make it easier to administer a lot of news on the covid front as always this morning >> well, yeah, and meg, i mean, a lot of good news that's what it all certainly seems to be. i mean, there is obviously concern that the virus will be with us come the fall. and the winter of next year. and variants, but everything you're talking about here would seem to at least indicate there are going to be new ways to combat it as well including potentially as you said, oral vaccines which could be helpful and new populations that are going to be able to get the current vaccines >> yeah. absolutely

when you listen to the companies, pfizer today we've seen the remarks from pfizer's ceo and the conference call is just starting now. he's saying that they expect the covid vaccine revenue to look like flu vaccine revenue going forward. that's something that wall street is paying close attention to pfizer stock flat today. even down now on this massive beat so really not convincing investors. a lot of this is good news in terms of us having technology to combat covid-19 going forward, but david, so much of what we're hearing from the industry is they're planning for this to be with us in the future. hopefully in a different way with the vaccines. it's hard as a human to hear that, even if it's good for the company's bottom lines >> meg, wall street watching it in more than a couple ways thank you. goldman sachs is planning to ask most of its staff according to a source to prepare to return to the office during the second half of june joining us this morning is the business reporter who broke the story, kate kelley

it's good to check in with you good morning >> good morning. great to be here, carl >> this is -- >> so -- >> this is based on a memo you looked at. what does it say >> it basically says most of the employees in both the u.s. and uk offices of goldman sachs which you're talking north of 20,000 workers here, close to 30,000 i don't have the exact numbers in front of me, need to prepare to come back to the office by mid to late june this is essentially a compulsory mandate. they really want people to come back there will be exceptions for health their also preparing to say their technologists and engineers will have greater flexibility. we'll see some exceptions and also work throughs for the capacity constraints that safety protocols have mandated. you may not be able to have 100% of your work force in any given office even if they want to or asked to essentially it's the first big

step, i think toward a full return to office and they're putting it in a memo expected to go out to employees sometime later this morning from what i'm told >> how does it compare to what jpm and b of a are saying? this is clearly much broader than the initial rumblings we heard that was that this was necessary for a trading room to exist. right? >> yeah. it's interesting and i and everyone else who covers my beat has been tracking this closely through the last year or so so jpmorgan has something kind of roughly similar they've said they're going to open all their u.s. offices on may 17 th and they encourage people to come back and give it a try. it's going to be voluntary sometime after july 4th, they would like to do something roughly similar to what goldman is going to do in late june where they basically say you need to come back in although, exceptions will be made for extenuating circumstances. b of a has not shared what their

return to office guidance is going to be in any specific terms whether that's a timetable or the ground rules. so different firms are taking different approaches of course, you heard ceos of major companies including a larry fink from black rock or jamie dimon opine on how office situations in the future may be very different than they were in the past, perhaps with less capacity so this is going to be a really interesting one to watch but i would say by and large, c carl yarks what i'm gathering is they're expecting a return to office by the fall for the most part and we're likely to see somewhere done a 3 and a 5 -day week for most employees depending on the nature of their job, i think those traders will be in for the most part. but maybe the bankers are in and out, and maybe they're doing less business travel and those that have functions like perhaps back office of again, coding, technology, they can easily be done remotely, may continue to be there if not all

the time, a healthy percentage of the time. >> kate, it's good to see you. it's morgan. i'm curious. has goldman outlined some of the details around what that return to the office is actually going to look like, testing, mandated vaccines, other things that could potentially be put in place to make it happen? >> yeah. morgan, good question. i think they have had a roughly 20% of their office in the new york office in recent months maybe even since late last year. so they have some protocols in place. i believe although i need to double check if they've added anything recently. they're doing temperature testing in the lobby they have a survey like a digital survey you fill out to see how you're feeling and if your temperature is above the sort of key thresholds, you might be asked to go home and rest or perhaps go see a health care provider. things like that they've had spacing in the offices that are wider than usual. i know, for example, that the management committee at goldman

has actually been meeting in person for quite some time from mid to late last year but they do it in a series of conference rooms. a handful of people spaced out and watching on zoom screens i think something like that is going to be a feature of the future wall street office in the sense of even if the bulk of people in a meeting are in the office, there's going to be zoom functionality because working from home will become more common place >> yeah. kate, it's david as you know, david solomon runs goldman. he's been in the office more or less the whole time. >> the entire time >> others were in jersey city and here basically a lot of their guys have been in there c but they're been sitting there in wonderment that they stuck to 15% to 20 % coming in. a -- my question is i've had these conversations that i know you've had

people come back in june, but what happens -- i guess what i've heard is by september there is truly going to be a moment where if you are not showing up, then maybe our view of our culture and your view of our culture are not the same and you need to think about moving on. is that something you're hearing as well? >> that's interesting, david i haven't heard that in so many terms, but i assume that's implicit to these mandates we've all been reporting on this for a while. i remember doing a story on the nfl last august. there was a fear among nfl staffers they were asked to come in office the league wanted people in ahead of the season ready to go. there was this fear that if you didn't, you might have to look elsewhere. so i think that's implicit if not stated and i think it will be really interesting to see going forward just how much flexibility there is on the margins. like i said, i think we'll see zoom functionality i've been sounding this out with traders and bankers. if you have a family obligation

on a friday and you tell everyone i'm going to work from home today, i think that will be much more acceptable than it was in the past, but for the most part, what i'm hearing from senior executives at banks is this is sort of a face time culture. we're willing to experiment with other options and, of course, a lot of these banks and other major institutions in new york are reducing their office footprint over the next three to five years maybe they're sending a minority of the people to florida because they want to move there for lifestyle reasons and they're in banking that might lend itself to be there. goldman longer term has expanded the head count in dallas, salt lake city, some of the other locations just as part of their long-term business planning. i think we could see some slippage in terms of the numbers in new york, but i don't anticipate wholesale change, and i don't anticipate people who are in core functions being able to stay in those positions if they don't follow suit

>> yeah. >> really quick, kate. there's a joint venture co-owned by american express buying the corporate travel arm of expedia based on what they say is a robust return to travel including in the corporate space. any read on how banks are feeling about that >> one thing i'm hearing on the personal size from the people in the industry i cover which is finance is they're ready to travel on the personal side. like, there are going to be summer vacations there are going to be fall trips. people really are feeling pent up and with ncreasing penetration of vaccinations even though we have a ways to go in new york city and around the country, people are feeling more and more comfortable on the business side, yeah, you know, i have heard that people are returning to client visits i've heard some kind of funny stories, but also reassuring stories about going to see a client in another city and going from one person's backyard to another person's office patio to another outdoor restaurant

so i think people are being safety conscious, but i would imagine that you are going to see a return to business travel even if it's not quite as robust as in the past and another thing i think is interesting is if we have situations where you have a healthy proportion of your staff working at home, summer all the time, do things like off sites take on a new importance after all, there have to be moments for a healthy culture to thrive and especially for training a new generation to get together, brainstorm, meet each other, develop some ties that's going to be an important aspect, i would think. >> kate, great scoop we love the guidance thanks so much great to see you again >> pleasure to see you all as we go to break, look at the road map for the rest of the hour including a look at the retail recovery as florida and the tristate region in new york announce plans to lift the restrictions plus we'll check in with the zillow founder on the housing

boom >> and the crypto craze continues with ether hitting another new all-time high today. we have got a big show still ahead. don't go anywhere. stay restless with the icon that does the same. the rx, crafted by lexus. lease the 2021 rx 350 for $439 a month for 36 months. experience amazing, at your lexus dealer. what happens when we welcome change? $439 a month for 36 months. we can make emergency medicine possible at 40,000 feet. instead of burning our past for power, we can harness the energy of the tiny electron. we can create new ways to connect. rethinking how we communicate to be more inclusive than ever. with app, cloud and anywhere workspace solutions, vmware helps companies navigate change. faster. vmware. welcome change.

so you're a small business, or a big one. you were thriving, but then... oh. ah. okay. plan, pivot. how do you bounce back? you don't, you bounce forward, with serious and reliable internet. powered by the largest gig speed network in america.

but is it secure? sure it's secure. and even if the power goes down, your connection doesn't. so how do i do this? you don't do this. we do this, together. bounce forward, with comcast business. welcome back eve within stocks taking a breather, ether hitting an

all-time high, but it hasn't convinced the crypto critics >> of course i hate the bitcoin success. and i don't welcome a currency so useful to kidnappers and extortionists. nor do i like shuffling out a few extra billions and billions and billions of dollars to somebody who just invented a new financial product out of thin air. i think i should say modestly that i think the whole damn development is disgusting and contrary to the interest of civilization >> charlie munger, never once to mince words. joining us, jill carlson thank you for being with us today. >> thanks for having me back >> i just want to get your reaction to those comments i mean, certainly warren buffet

and charlie have been wrong before where some technology and tech stocks are concerned. how do you see this? criticism valid or something that is being misunderstood by as some folks i think would put it, maybe the old guard of wall street >> well, look, you know, buffet and munger, you can't disrespect them, but they're value investors. they do what they do, and the beauty of is the world of investing is abundant. there's room for kathy wood and munger what i take issue with is the claim that it's a drain on civilization and that it's used in kidnapping and extortion and all of these things that he spoke to i would encourage him to take a look at banks, the precious bank stocks that he and buffet have made so much on over the years and look at what banks have enabled as well. >> yeah. i want to dig into that, too

first, i want to get your thoughts on ether which powers the etathere yum platform. it's been block chain technology and some folks pointing to the fact it's kplaing with bit county how do you see the moves in crypto currency right now? >> it's been a wild few days for the first time candidly, i'm starting to feel like athereiums rise is used by real usage in quarter one alone, nft changed hands to the tune of 1 billion. so while i wouldn't put it in the value category that we were talking about with munger and buffet, it certainly is starting to show signs of real usage

picking up, backing up the price rise here as well. >> jill, you mentioned banks and obviously berkshire has a sizable amount of shares in a number of the big banks. what was the point you were going to make when it comes to crypto and the banks >> look, crypto currency has a bad wrap in terms of legal versus illegal usage if you look at the actual numbers, in 2020 according to one of the leading firms out there doing this kind of study and analysis, crypto currencies activity, only 34 basis points of it was used in dark or underground markets. then you look at what goes on in the banking system, and you know, the sort of light banking system, and okay, maybe it's not exactly kidnapping and extortion, but you certainly see enough money laundering finds coming at the banks that, again, munger and buffet have made so much money on. if you're going to take this moralizing investing stance, you

have to look at your own portfolio. >> given the broader conversation with the platform is concerned what are you talking about when you mention decentralized finance. what does that look like >> it's already here i think that's the main take away i would drive home. you look at decentralized exchanges, uniswap, zero ex. and you look at the volumes that they're doing, and you look at the fact that they're competing even with the likes of coin base in terms of volume, you look at the fact that the markets that they're able to go after are global in nature unlike most exchanges which are subject to jurisdictional regulations and limited in that way. and you just start to realize that the markets for these are just enormous. and there's a lot of exciting value to be unlocked there still. >> yeah. something i think we're going to talk about a lot more in the weeks and months to come

jill, thank you for joining us today. >> thanks so much. when we come back, the founder and former ceo of zillow will talk about home prices hitting a new high up 17% in a year are we in a bubble quk t see about that later on "sawonhetrt. cal: our confident forever plan is possible with a cfp® professional. a cfp® professional can help you build a complete financial plan.

visit letsmakeaplan.org to find your cfp® professional. ♪♪ ok, at at&t everyone gets our best deals on all smartphones. let me break it down. visit letsmakeaplan.org to find your cfp® professional. you got your new customers — they get our best deals. you got your existing customers — they also get our best deals. everyone. gets. the deals. questions? got it. but, why did you use a permanent marker? because i want to make sure you remember. i am going to get a new whiteboard. it's not complicated. only at&t gives new & existing customers

the same great deals on all smartphones. get up to $800 off our latest 5g smartphones. i think you're going to like it here. umm, why is everyone... throwing things at me? look, as cfo it's my job to be ready for whatever's next. that's why i have my finance team, randomly hurl things at me. it's also why we use workday. it gives us insights, so we quickly pivot our strategy, people, planning, you name it. sorry, sir. i will aim straight at your next step. see that you do. would you like some coffee? workday. the finance, hr, and planning system for a changing world. ♪

welcome back here is your cnbc covid update india's total covid infections topping 20 million this morning. it's a grim milestone for the country. battling an epic surge in cases. india reported roughly 10 million cases in the last five months with the majority of spread happening in april singapore is tightening the borders. it's imposing a 21-day quarantine an most inbound travelers. here in the u.s. new restrictions on travelers from india take effect. the ban applies to those coming to the u.s. from india who are not american citizens, permanent

residents and other exempted individuals. those approved to travel will need to test negative, quarantine and retest upon entry. good news from the west coast. los angeles county reported the second straight day of no covid related deaths for the first time in a year officials will be watching to see if the trend continues or if it was due to a weekend reporting lag. you're up to date. carl, back to you. all right. thank you very much. we've been bringing our viewers up to speed on the selling. nasdaq down less than 2% this morning. mike is with us. the senior commentator to talk about the alleged -- >> i don't know if it's a specific trigger to me the context is one month ago we were saying hey, year two of a big bull market move, you're up 90%. usually there's giveback the market looks overbought. sentiment looks overoptimistic and nothing happened we ground to new highs a couple weeks ago i think

against the flow of constant good news, macro earnings and the rest, the market was unable to make headway. the growth sectors seem like they've been correcting under the surface. i think a lot of it is catching up to people's sensibility that we probably saw peak acceleration in terms of growth rates, ism, earnings to me it's all the things really creating a little bit of restraint on the overall indirection. >> mike, jim, carl, and i were talking this morning as well about what appear to be strong earnings for many companies but not getting a positive response in the market. is there anything that can be read into that >> i think it's the observation. the market and only in retrospect can you see the market figured it out. i think that's kind of the idea. but also this idea of we can't extrapolate the growth rates indefinitely it's clearly we have this bounty of earnings both from the growth sectors and from the cyclicals that yeah, estimates are going

higher that's supportive. that should mitigate the downside the estimates do keep going up, but basically no surprise to the market that things looked great. credit markets have not actually improved tick for tick with stock prices in the last couple weeks. they're fine they're not showing stress they also have not necessarily become incrementally better as the s&p kind of clicked to new highs. >> a number of high profile investors and strategists have increasingly been saying that they would expect to see some sort of pullback or correction here what are the key sign, the key things to look for for that to happen >> i mean, the first thing is you have to actually see some determined selling maybe we're going to start to see it localized in some of the big growth sectors the market has really not really had anything more than a 3% to 5% pullback in the last six months that's a long time to go without a 5% pull. not unprecedented but a long time to go honestly, you watch the tape itself and say is it happening?

i don't see the stress really building up in terms of the credit markets however, over the last couple weeks the volatility index has gone up a couple points even while the market was flat and staying at the highs that probably told you that people are doing a little more hedging or at least flinching in advance offing what might be a blow in terms of the chappiness on the downside. >> this is the 11th day the dow has alternatedbetween gains an losses just speaking to your point. mike, thank you for joining us bill and melinda gates are divorcing after 27 years of marriage leaving questions about the vast wealth and foundation >> david put it well, calling this more like a corporate divestiture with broad business financial and philanthropic implications over 130 billion and an empire of assets and the largest foundation in the world that

spends as much as many governments on certain causes. we don't know exactly how all this will be divided but it has been the largely decided in the filing. they cite a separation agreement that remains confidential. washington state is a community property state that means that any assets that were acquired during their 27-year marriage could be divided equally. most of their wealth is in cascade investments. that's the family investment vehicle with about $75 billion in assets. it includes big positions in publicly traded companies. it owns ethanol plants and the four seasons hotel change or co-owns. it is a big investor in big projects real estate projects in tampa and other cities and they own more than 250,000 acres of land. they are the largest farmland owner in america now, the gates foundation has

about a $50 billion endowment. they give away about 5 billion a year it is no longer a marital asset. it's a separate entity answerable only to the board it is not subject to any kind of division the couple is saying in a statement they will continue to work together at the foundation, but not for profit experts telling me that it will be difficult for them, perhaps, to agree on what causes to support, who is in charge, how to invest as well as how the board is responsible and who they answer to the couple has pledged to give away 95% of their fortune. that leaves about $120 billion now with a less certain future guys >> yeah. robert, given how large this is and what they need to do, it's my understanding that it's been worked on for quite some time. it's not as though they were announcing this and then all the work is to come. it has been something quietly of focus for some time, the couple

already knowing they were going to split i'm not sure what that means or what we'll learn or not learn, but it's more done than not. >> yeah. that's right i mean, the complexity of this, we just tend to think of this giant pool of money that's $130 billion and the foundation which will sort of co-manage and be left alone, but the assets themselves in cascade and in the rest of that $130 billion, there are private, public, blended, venture capital, private investors. it would have taken and will take years to unravel all that what do you sell or keep who is it attributed to? this is a complex deal i have no doubt and a credit to your reporting, they've been working on a long time, and will continue to work on for years. robert, thanks great stuff. robert frank helping us understand the divorce as we go to break amid the broader tech sale, nasdaq down 2

%. gardener it services up 20%. ticker it after beating on earnings, raising full year guide. oc at stksan all-time question "squawk on the street" continues in a moment.

president biden is calling to help fund the american families plan. the president is asking for higher taxes on raes transactions with gains of more than $500,000. joining us now is the former zillow group ceo good morning to you, spencer you have a good beat on the real estate market overall. obviously all the years with zillow and even what you're doing currently. what is your sense as to whether or not these taxes go into effect they'll have a real impact on the market itself? >> well, clearly some people are moving from high tax states to low tax states and the potential increase in capital gains rate

federally and also income federally will accelerate that however, what's really driving the housing market right now is not actually tax policy, not the biden proposal and not even state by state differences it's limited inventory so if you think for a second over the last four decades in the 70s, 80s, 90s and 2000s, about 26 million homes were built every decdecade for 40 years in the 2010s, only 6 million homes were built in the united states there's a 20-million home gap of houses that don't exist which would have existed in the past decade that's why home prices are increasing tax policy, sure, it has a difference on the margins, but the real issue and what's driving home value aappreciation is limited inventory because of new construction >> and that was the housing bust in '08, '0 9 we did not get anywhere near the levels we were accustomed to what are you seeing in terms of trends we talk about people leaving high tax states.

perhaps that's one reason. weather can be another is this exodus for real? do you expect it to go on? what are you seeing in the markets such as florida or texas where there's a great deal of demand people are untethered. that's causing a lot of people to want to move. in my world, i know probably half a dozen people that moved from california to texas or from new york to florida. i'm sure you do, too so to give you data to inform the conversation if you think of austin, texas. a major tech hub apple is creating billion dollar campus the office space there austin home values are up 18 % year over year that's scorching it's normally 2 % year of year salt lake city, another tech hub not technically cited that way but there are more engineering and graduate engineering degrees in salt lake city per capita than san francisco, denver or

boston and the home values are up 15 %. and san francisco home values are down 3% year over year clearly people are leaving san francisco. home values are going up quickly in places like salt lake, austin, miami. and some of that is tax driven a lot of it is lifestyle driven. you don't have to be in a particular city anymore. people are choosing to move to different places >> spencer, you know, you talk about limited supply wells did a report a couple weeks ago where they argue we're just laying the foundation for this cycle they say there's a long tail ahead. demand support for 2.3 million through the rest of the decade with supply consensus at 1.5 do you think that's legit? could we be talking about this for seven or eight years >> the problem is that just when we were starting to build houses, covid happened and commodity prices have gone through the roof the price of lumber is about 3 or four times what it was a year ago. i'm talking to builders across

the country where they're abandoning projects and selling them to individuals instead of completing them because it's so expense i for them to build because of commodity prices. i hope that we are able to solve the inventory shortage what probably happens is first-time home buyers decide to continue renting because remember, if you're an existing home buyer, and you already and a home and you're selling and buyer, you have appreciated equity to trade in to the new home. if you're a renter, you don't have that advantage. so the way this probably normalizes a little bit with new construction but also first-time home buyers deciding to rent because they can't afford to make the leap to buy >> it's a perfect storm if you talk about lumber, labor, copper, go down the list here. but i do -- i do want to get back to the tax piece of this equation i know you said it's the inventory shortage situation right now, but i have to think with biden proposing to reel in

a 1031 exchange with profits exceeding 500,000. and the capital gains, it exacerbates it further if it becomes reality. >> 1031 exchanges are important for housing transactions the changes in capital gains and income, i mean, obviously it will affect people, but it's -- i mean, the data i've seen says it doesn't affect people as much as you might expect. and especially -- from an asset allocation standpoint, wealthy people have to put money somewhere. as long as rates stay low and as long as the economy stays strong, they're going to chase yield. they're going to chase returns they move further out on the risk curve whether that's into tech assets or art on the block chain like nft or crypto or real estate speculation

they're doing that to chase return because interest rates are so low and they can't earn any money in fixed income. that's how individuals are thinking of tax policy it's affected on the margin for certain types of people. but the data i've seen says especially with real estate, it doesn't really drive the market. >> spencer, thank you. >> thanks for having me. >> sure thing. as we head to break, take a look at the biggest laggards on the dow right now. apple down 3%. wall greens, salesforce, boeing and intel all leading the average lower. we'll be right back. stay with us

which stocks look best on the charts as may kicks off? we're talking top technical setups on trading nation mi ure" uawk on the stet congp.

t-mobile is the leader in 5g. we also believe in putting people first by treating them right. so we're upping the benefits without upping the price. introducing magenta max. now with unlimited premium data that can't slow down based on how much smartphone data you use. plus get netflix on us, and taxes and fees included! you won't find this with the other guys. in fact, you'll pay more and get less. right now, pay zero costs to switch! and bring your phone -- we'll pay it off! only at t-mobile.

welcome back retail stocks looking to rally with covid restrictions being lifted to varying degrees in florida, new york, other states. courtney reagan has more on the moves for us courtney >> hi there, morgan. may 2021 looks so much different than may 2020 for retail stores are open and shoppers are starting to come back. the retail etf, xrt gained 160% in a year. with strength even just the last couple days, but the biggest retail winners might surprise you. it's not the big online players or even those that consumers flock to for essentials and outfitting the homes the online retail i buy is up 7% in 2021 but down 3.5 % over the last month amazon up 45% in a year, but up

less than 3% year to date. walmart down 2 % year to date. way fair is down nearly 20% this month. william sonoma gained 20% in 2021, but down more than 4 % over the last month. so let's check out some maul-based retailers i said mall. sure, they were among the most sold off, but the comeback is pretty eye opening american eagle up 380% in a year and 24 % over the last month n. an abercrombie up 80% gap 16.5% over the last month. and denim, yep, morgan, including those mom jeans and looser fits, leggings and sweat pants are being put aside with americans leaving the house again. contour brands, the owner of

lee, wrangler, that's up 32% this month carl, back over to you >> wow what a story for that sector thanks so much coming up on tech check, we'll talk about the selling on the nasdaq today on the nasdaq 100 right now, 100 components the number that are green, five. gtore aas at the laggards w weo bak ♪ ♪ (upbeat music) ♪ ♪ ♪ ♪ ♪ ♪ ♪

oh when june-- hit that guy! yes! wait i don't remember that! it's in season 4 - don't tell me you haven't seen it! i watched season 3. you won't stay caught up for long unless you keep watching the best shows from hulu, peacock, starz, showtime, and hbo max, all year long. just say "watchathon" into your voice remote to add a channel or streaming service and stay caught up.

welcome back to "squawk on the street." i'm dominic chu. stocks in selling mode with nearly every sector in the s&p 500 in negative territory, real estate the only green communications services and technology in consumer discretionary. see the three worst performing sectors so far within that com services group, in particular, we are seeing some notable declines in technology giants like social stocks, facebook, twitter, alphabet you get the idea media and television names, viacom, cvs and disney, and live nation entertainment, we end

there. worst performer in the sector so far today. more than 15% often its early highs we saw back in march keep an eye on live nation morgan, back to you. >> dom chu, thank you. later today do not miss the cnbc small business playbook most trusted voices in business providing critical advice to help owner overcome extraordinary obstacles and stage a strong comeback. wee ckgierow 'rba in two. i have an idea for a trade. oh yeah, you going to place it? not until i'm sure. why don't you call td ameritrade for a strategy gut check?

what's that? you run it by an expert, you talk about the risk and potential profit and loss. could've used that before i hired my interior decorator. voila! maybe a couple throw pillows would help. get a strategy gut check from our trade desk. ♪♪

over to the cme again and rick santelli for the santelli ex-changes rick >> reporter: good morning. thank you, morgan. i'd like to welcome my guest jerome snyder of pimco, managing director and head of short-term portfolio. welcome. had a short-term portfolio wow. a real undertaking these days. remember, the central banks, our fed, making stocks to go, too, but making the fixed income the run from all this cash out there means

risk are money markets good where's all the cash going >> a great question and great point to ask spend a moment on cash balances increased significantly. savings rates up to 20% even this month, and we're finding that this incredible amount of cash is effectively create add black hole gravitational pull simply eroded any type of yield within the traditional money market landscape. things like t bills trading at 0% yield overnight repo, 0% yield federal reserve's reverse repo program, $130 billion earning zero this point in time. the cash balances, $4.5 trillion sitting on money markets now are looking to find a healthy balance between zero yields in the money market spaces and effectively potentially being optional and opt optionality given the answer to the market days like this cash seems good going forward basis, actually ways to think how to utilize that cash and probably some questions to be asked by these

increased cash balances sitting on the sidelines for us, we want to be thoughtful and how to actively manage it. >> here's my question, though. okay if i'm watching the segment now, what i want to know as an investor, is the u.s. and many of these countries considering covid and post-covid and all the things central banks has done is there really safety in equities markets? bank of japan owns etfs, accumulating assets. are we supposed to start looking at stocks as a utility created by central banks >> well, i think not quite there in the united states yet we could be seeing some of the fed policies during the crisis to sort of transcend to that etf landscape to provide support those of emergency policies. most importantly we maintain diversification in port follow j port fofolios is essential.

we still have to focus on the long-term. >> and we have to leave, because the shows are going to switch here have to leave, but i'm going to have you back. we have to figure out are central banks helping post-covid or making decisions more difficult. thank you for joining me today morgan, back to you. >> rick santelli thank you. dow down more than 1%. that does it for "squawk on the street." "techcheck" starts right now. ♪ good tuesday morning welcome to "techcheck. i'm carl quintanilla with jon fortt and deirdre bosa amazon trade watched, sell offoffto mid and small caps what investors are looking at outside of big tech. what's going