good morning welcome to "squawk box" here on cnbc i'm becky quick with andrew ross sorkin and mike santoli. good to see you. a lot to check out with the markets. this comes after the dow tumble 533 points on friday it came after the st. louis fed president jim bullard spoke to us on friday you would not have known by looking at the dots. he is more hawkish he is looking for a rate hike next year. the market's interpretation is interesting. it did come on the quadruple expiration things are bouncing back this

morning. the dow futures indicated up by 190 points s&p up by 18 nasdaq up by 72. what is really interesting is what is playing out with the treasury yields. 30-year fell below 2%. you are looking at 2.023%. you have seen a flattening 10-year is back down to 1.436. it fell lower this morning mike, part of what we are seeing here is panic with the selloff in asia overnight. >> asia had the catch down on dow from friday. it did not feed through to europe it is unclear if it is spiraling. what jim bullard said on friday pushed the market in the direction it was already unwillingly going in the prior

two days we're not prepared everybody crowded in the precise wrong trades inflation assets the other thing to keep in mind, s&p up 12% or 11% year to date bonds are still down if you had a portfolio, the direction of rebalancing goes to bonds. we say people are under invested in longer term bonds this is what it looks like with the shot of incremental moves from the fed >> it is interesting the dow at this point is now 5% off its all-time high. the s&p is only 2% off the all-time high. nasdaq at 1.25%. stocks in japan plunging overnight. fell 4% before pairing the lo losses most sectors took part in selling including nissan and honda falling 4% each.

and looking at the "squawk stack. dow transports with the worst week since december of 2020. at this point, they are now down 9 9.5% >> it is very emblematic of the markets and the idea of the shortage economy and pricing power. all of those things captured in the dow transports prior to this, the longest winning streaks in years i do think the unwind is focused in the markets i don't think it means something. >> the dow transports tell us where we're headed >> if the dow industrial and s&p is doing something, transports are confirming or denying that is valid at this point, it is an

exaggerated version of the dow industrial >> the dollar is weaker. it was up 1.t9% for the week. that is the reason you see the selloff for the commodities. corn is down .3% after falling 7% last week soy beans were down 13% last week the worst week since june of 2013 palladium is up by over 1.1% this morning cryptocurrency is plunging many bitcoin mines were halted after 90% of the mining capacity is estimated to be shutdown. the aeg bank of china is

reported to block crypto trading. this has been a theme for a while with chinese authorities not happy with reliance on bitcoin and use of bitcoin on the other hand. it is a vulnerable market. this is unclear if it is about s supply or demand or vulnerable >> andrew, that is a turn around from what we have seen before. the talk that maybe china liked seeing bitcoin because they thought it could rattle the united states and dollar supremacy. maybe not the case at this point. >> i don't know. i think the question i have about bitcoin is what happens with the fed will it take bitcoin down? is it separated? is it not? i think -- look, it feels correlated to the markets.

again, you have the belief system and there are a lot of people out there that are quote/unquote, belibelievers. i put my hands up. i don't know what to say. >> you will have a lot of believers. you will have a lot of people riding the market that was melting up and the hot money on the way out. >> the question i have had about this is how much leverage in the bitcoin ecosystem. i think that will actually -- if and when we find out there was leverage used, that, to me, could represent -- if you are looking on the negative side, the question is how much support there is when things come down to the rates i don't know i talked to people who think $28,000 is a screaming buy is it a screaming buy? i don't know >> you only know how much leverage is there after the

price declines happen and people get trapped. you hear people pointing out that bitcoin was cut in half and it did not seem systemic or cause widespread spillover in other asset markets. prime day sales event starts today. the retail industry is grappling with widespread problems making it challenging to stock stores recent covid outbreak in the chinese to the busiest port is compounding that issue more on prime day at 6:30 a.m. eastern time. let's talk about the deal of the day. the spac of the year we will see in terms of size, it clearly is bill ackman's spac signed a deal to buy 10% of universal for $4 billion umg is taylor swift's label. value of the company of $4

billion. vivendi spinning off umg later this year to complete the planned listing in late september on the euronext. it would distribute umg shares to the shareholders after the listing. tontine will remain a listing. they intend to pursue a business with existing company. it is interesting they get two bites at the apple if not three because they also have something called spark we will talk about that. tontine was the biggest spac with $4 billion with ackman's company. umg is the part label company with justin bieber and elton john and adele among some of the

clients. it is a complex transaction, guys there is a lot to dig through in all of it. to me, the most interesting piece of this, effectively, you are buying a company that will be going public later. you are buying it at a discount. if you bought shares of vivendi, you get umg shares you get a tax bill if you buy them through pershing square, you get it at a discount because no tax is involved and you lock in a price that bill ackman thinks is advantageous we will see where it trades come september. it is interesting. the second bite of the apple piece of it. we will see where that goes. then the third piece which is the idea he will raise money from current owners of tontine

you only pony up the money once he found the transaction that may give you a third bite at the apple we'll see how you value all of those things and the market is valuing them >> andrew, the idea of being an in in intermediary step of the company going between the markets. for ackman, isn't it setting the clock for the spac if you did the deal fin the timeline >> it has the effect of stopping the clock. no question one of the few feat for drawback to find the target and given the size of bill ackman's spac, there are only two targets out there. he found one not the traditional merger, if

you will, that many spacs go through. i'm sure there are lots of folks that there have been scratching their heads trying to understand what it means. i think the question he will be what is the value of umg has he bought it at a great price or not at a great price? does the tax benefit matter? does it not? those are the immediate time period that people focus on. now the clock has stopped, you know, what is the next deal? is the next deal a success is it not a success? now this potentially third deal on top of that and how do you value the option value of that i think it's a lot to process. he is going to be giving a press conference a classic bill ackman press conference he used to in the old days i think he is doing that wednesday of this week we will get a lot more to chew

on in terms of what it means then >> all right when we come back, we will talk more about that commodity crush. prices of corn, soybeans and metals all pulling back substantially last week. this comes after an astronomical run-up this year we will talk to goldman sachs commodity expert next over the high water mark. and dr. scott gottlieb will join us about the covid variant and what a fall surge could look like "squawk box" will be right back.

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welcome back commodities taking the spotlight after months of rising prices. soybean with the biggest drop since 2014 corn was down sharply. metal, copper, gold and palladium with the worst week since last year. we have the analyst from goldman sachs with us. >> we like to argue the bullish thesis on commodities has nothing to do with fed forward guidance what it has to do with scarcity

in supply and demand that hasn't changed. the commodities that sold off last week are the most sensitive to the dollar. talk about potential rate hikes led to the stronger dollar environment which created that liqui liquidation. the underlying fundamental pictures have not changed. oil is the comemodity that we liked and hasn't changed i want to caution the non-energy commodities are not at risk. >> what risk oil is on a steady march higher as the economies open. it is trading $70 a barrel for wti. >> we look at the demand surge taking place we estimate the demand is 97

million barrels per day. with that demand increase against a nearly elastic supply curve, inventory is dropping at a rapid pace our target on average for third quarter is $80 a barrel. that can spike above that during the third quarter. we see a lot more up side risk to oil >> jeff, you mentioned the underlying story is the demand which has legs you know, doesn't it also have to do with how much financial speculation is in the short-term in prices? did we not see that last week with the unwind of hot money chasing some of the story lines? where is the physical clearing price sit for the commodities? >> i have never seen a commodity market so long on conviction and

short on position. people talk a lot of talk about wanting to be long commodities last week, copper is the king of the commodity story this sector. going into this, this market, it wasn't that long oil is below average grain was 80%. here is the other point. when we talk about length. we are talking about levels the last 20 years. think about what happened to bonds, stocks. they have done this over the last two decades commodities have done that if you look at total aum it is about this much speculation length in the market it has a lot of room with the potential of absorbing investor demand. >> jeff, you mentioned it is

inelastic, the supply for oil outside of opec. that is not the case with corn and soybeans the shortages resolve quickly because farmers will plant more. what will make it so the supply doesn't catch up with demand >> supply could catch up with demand even on oil you know, oil, the key question is when will you see a rebound in shale drilling? by now, as you pointed out, we are at $72 a barrel today drilling for shale last week at 473. we are not even at a break even level with rig counts. why are the companies so slow? return on equity metals or agriculture or oil these have been poor performing

sectors for years. in some cases decades. many of the suites are focused on the returns higher and focus on spending. that creates a lot of near-term side business. >> that is a concern they will not chase after the higher prices right away what does that mean? broaden that out in terms of what the fed is anticipating this is transitory and higher prices will pass do you think they're wrong >> typically what the fed does and many macro economists, they put in the forward prices. particularly the oil is in a steep degradation. we have been arguing this as the case since october of last year. you need to put in more appropriate prices for com commodities which reflects what is going on. i think they do need to

incorporate a more accurate read of what is going on with the commodity markets. going back pre-covid, putting in the forward wasn't too far off the market spot prices sat above. because of the degradation, you have to point that out it is not the market thinks prices will go down. it is an indication of the shortage you are willing to pay the premium to have the commodity today. i think about oxygen you pay a premium for it today because you don't need it tomorrow think about that downward sloping forward curve as bullish. >> that is a lot to think about, jeff especially with inflation prices and equity good talking to you. >> thank you for having me okay coming up when we return, the cruise industry dipping a toe

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challenging cdc order to shutdown the cruise industry during the pandemic. i think we're going to see more cruises set sail very soon vaccine or not >> it looks like it. it is getting tougher to fly american airlines canceled 180 flights yesterday or 6% of the main schedule and 4% on saturday the company showed half of the cancellations were due to unavailable flight crews >> that crazy. that is not something when you talk about shortages, worker shortages everywhere it is shutting down the flights. i don't know how the fed works that into the thinking >> some people commenting and

said the labor market is behaving tighter than you think at this point. that could make them confident of the growth goals or inflation side >> becky, one other point. this goes to what doug parker was arguing against me on the debate about the u.s. government supporting the airlines and one of the things the airlines and sara nelson who represents the flight attendants would say we need to keep the planes in the sky, but we need to keep the employees on board so the second the economy and health restrictions were open, people can fly and we can actually get everybody in the sky if we furlough people and not all people on board, they won't be ready to go you are seeing some of that and i'm not willing to eat crow just yet on my views about the bailouts

that was the issue to some degree, you see some of it come true >> we have to continue to watch. is it just american or all of the airlines were others able to do things to keep people around that is part of the question i have not heard this at other airlines yet not to mean it won't happen. >> some of it is scheduling issue or over scheduling or over committing, if you will, relative to staffing that seems to be part of it. if you are looking at the uk, the government is signaling it will keep restrictions on overseas travel in place amid the covid infections the justice minister said normal holidays would not be the case among the third wave of the virus. conservative lawmakers were pushing to loosen restrictions with the extension and shares in

the travel and leisure industry drop today the question becomes if this is the case, if this is the bigger problem and this is a variant that is more easily spread by younger people, too, what happens if that comes here that is something dr. scott gottlieb will talk about with us this morning. coming up, we dig into the amazon massive sales event and the challenges with shipping delays mark mahaney joins us next. and are you working to live or living to work? the case for the four-day w work week. coming up when "squawk box" comes back >> announcer: executive edge is sponsored by at&t business our people and network will help keep you connected let's take care of business. es something different.

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good morning welcome back to "squawk box" on monday morning futures are looking better than where we ended the day on

friday dow opening up 64 points higher. nasdaq higher as well at 54. s&p 500 close to 15 points mike. thanks, andrew prime day for amazon kicked off three hours ago. is this the stock to bust out the narrow trading range we have seen in the last nine months mark maheney is joining us now he has a $145 price share target good morning, mike >> good morning. >> we talk about amazon stock as stuck since labor day last year. it is down a bit from the highs. also, up 80% from the last two years. it is a matter of framing. what is going on that has been holding the stock in place since last summer in. >> mike, it has the dramatic

rise in the stock last year as it was correctly perceived as a covid winner the consolidation space and then the heightened regulatory risk and more intense competition from omni channel retailers like walmart and cloud space which gets tougher and tougher with the momentum there is a competitive difference and bezos factor. we are weeks away when he formally steps down as ceo he will be executive chairman. there will be a question how well amazon will proceed when bezos leaves active membership there is also a macro here we move away from value growth that is also the key limits on the stock currently. >> that makes sense. few of the things you mentioned,

regulatory risk potential and ongoing competitive challenges those are pretty much constant at the moment. you can't see the end of it. what do you think it will take for investors to gain confidence or not about management of the company post jeff bezos? >> that's a really hard one to know we will not know for several years of jeff no longer running the company on a day-to-day basis. you will not see any change in the business that committee and those people -- the group of 20 people around jeff has changed barely in the last 15 years that's one of the reasons why the company has done so well and executed in a variety of industries the x-factor is five to ten years from now if you will see the product.

as we shift valuation in 2022 and 2023, the secular growth that amazon had will come back in spades and it will be the number one market cap. >> presumably, a little bit of uncertainty about what the growth rate will settle back to, i suppose. you have the huge bulge in broe growth on the retail side. what is the run rate of top line growth for amazon? >> prior to covid, this company did for 15 years, consistent 20% top line growth. that is such a rare air. you don't see that consistent premium growth what is interesting about the june quarter, they are still at it despite the comp almost doubled on the prior year growth

rate our guess is that given how well they are positioned against advertising cloud and retail, this company continues to print near 20% growth for the next several years. investors gain confidence and the stock will rel-rate. the growth outlook has re-rated and gone up. >> you know, it is commonplace to say and it makes sense that, you know, in a distant scenario in which there was a mandate and break up of the company -- are there business practices that you think would be particularly damaging if there were other restrictions on them whether promoting amazon products or anything being talked about right now which is a game changer >> mike, if there was a forced

break up of the company, like spin off aws, that would cause the share price to rise. i don't think they would get full value for aws within amzn there are two companies that i look at with the conflict of interest they own marketplace and they compete in said marketplace. one is amazon and one is google. if they were no longer allowed to compete in the marketplaces or had to separate first party retail and third party retail, that would be a hard thing to do that could be an issue for amazon in terms of future growth >> obviously, we will not know any of that for some time. we have to track it, mark. thanks very much. >> thanks. when we come back, golfer jon rahm celebrating father's day in a memorable style at the u.s. open. here he is we will talk more about this in a moment later, jared bernstein talks

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futures this morning after a big decline on friday with the dow down 533 points. the dow futures are indicated up by 181 points. s&p futures up 16.5. the nasdaq up 67 there has been a bit of activity in the treasuries market this morning. nikkei was down 4% it ended up down 3.3%. that sparked concern into the treasury market. that is where you saw yields come down. 30-year is above 2%. earlier this morning, it fell below 2% that's the first time that has happened since february. you have pressure. 10-year coming back down to 1.43%. the 2-year up at 0.62% yield curve flattening i don't know what it means >> what it means for the moment is the market is saying we have rate hikes coming in sooner than

expected we have the fed expressing alarm which should reduce the threat of longer-term inflation which erodes long-term bond prices that is the textbook price both those things, i think, can be true, in part i don't know if yyou were watching jon rahm is the 2021 u.s. open champion back-to-back birdies on 17 and 18 sinking clutch putts. 24 feet and 18 feet respectively he finished at 6 under this is rahm's first major championship he is the first spaniard to win the u.s. open. the victory comes two weeks after he was forced to withdraw from the memorial tournament for testing positive for covid-19 after the third round.

you see he was brought to tears. he was asymptomatic. he knew he had an exposure torrey pines holds a place in his heart. this is where he proposed to his wife along of the cliffs there he celebrated with his wife and son there. you see her and their son. when he had to pull out of the mem memorial, that cleared the way for phil to have the triumphant takeover for the win phil, who did not play well at the u.s. open, took jon's wife over to make sure she had a seat >> they are scripting these things well. all things came together i don't mean for him i meant rahm

coming back from disqualified. >> a tear jerker on a father's day, too coming up when we return, employers struggling to fill job openings is the power in the labor market shifting to workers? our next guest is making the case for a four-day work week. and negative headlines from china with cryptocurrency. 90% of the mining reportedly shutdown and blocking crypto trading. ng , not what's easy. so when a hailstorm hit, usaa reached out before he could even inspect the damage. that's how you do it right. usaa insurance is made just the way martin's family needs it with hassle-free claims, he got paid before his neighbor even got started. because doing right by our members, that's what's right. usaa. what you're made of, we're made for.

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welcome back to "squawk box. covid cases drop in the u.s. and employers welcome workers back

to the office, the next guest is proposing a shift to the industry we have joe with the fascinating piece out entitled "kill the 5-day workweek." joe, i don't want to say the headline had a click bai potentially towards a four-day work week. >> yeah. i think this is a moment when a ton of assumptions about work are just getting totally up ended and as i was looking at this and thinking about this more and talking to companies and workers, i think it's time to also start instead of -- in addition to just revisiting assumptions about physical work and how much people should be paid and -- i think we should start looking at what the actual workday looks like, what people spend time at work and that leads us to thinking about how we might be able to shorten the

work week. >> we have two camps in america right now. there's one camp that says forget about hybrid, we're going five days. we want you back in the office all the time even when they say we want to be hybrid, the true view is we want to be all the time then there's another view probably represented by silicon valley and some of the younger companies in the country that are embracing hybrid and can embrace this four day work week. you look at them and claim they have much higher productivity. >> yeah. i mean, the companies that have implemented this have run the gamut and they generally -- a lot of them are knowledgeable companies. they're tech companies small marketing firms, but they also are other types of companies. they're nursing homes that have done this. i also spoke to a manufacturing company. i think there are all sorts of different industries in which

it's possible for them to get the same amount of work done in less time. sort of the -- like i mentioned manufacturing example. it's not just about people typing on computers. i spoke to the ceo of the company that makes metal truck bed covers they shaved five hours off their 40 hour work week for the factory team they found out people were able to get their jobs done more quickly. they were shedding the least productive hours people were looking up and down the line in front of them seeing how they could speed things along. a lot of companies have given employees an actual real reason to start working more efficiently and quickly which led to a win for everybody >> but just to put a fine point on it, total hours over the course of the four day work week if you will were what compared to the five day work week? are we taking the eight hours and pushing them out to 10 or 12 on the four days

>> right this is a point worth clarifying these are companies that have taken 40 hours and shaved it down to 32 hours over the course of four days and not reduced pay. this is a really key idea. i think there are companies that have compressed 40 hours into four days. they talk about their productivity benefits, this is great. my argument is much more about giving workers more time outside of work to do things they care about, to rest from work a three-day weekend in that context seems to really help rejuvenate people a lot more. >> what is your sense of the in office versus work from home part of the equation let's assume we shrink down to a four day work week we can't do that on "squawk box" because the markets are open five days a week squeeze down to four days, does it matter whether you're in the office or working from home?

>> that's a good question. i think it speaks to a larger point here about how managers like to have their people around them so that they can sort of manage them in person. i think a lot of companies, people don't entirely trust their employees to get stuff done switching to a four-day work week is a huge trust they have to trust that they will work and get it done and be more efficient i don't think it's safe to say that productivity is a function of how much time you spend in the office surveilled by your manager. i think you can get a lot done when that's not the case. >> hey, joe, i agree with a lot of what you're saying. i do think there's a

paternalistic attitude, if they aren't watching you, you're not doing it if you can turn that productivity up like at a manufacturing site and get things done faster, i think the bigger question is who gets the gains? does it go to the company? does it go to the worker if you get your work done faster, you can get out of here. that's a huge question >> yeah. i think the key in a lot of these circumstances is by getting the same amount done in less time you're basically giving workers a reason to buy into this. one of the companies that i talked to some of the places called perpetual garden in new zealand, their ceo came to the employees and said if you can get your work done in less time, i'll give you an extra day off it's a little bit of giving

people a stake in what they're doing. if you give them a reason to do that, they're going to be on facebook less. they're going to be scheduling doctor appointments less there are things people do that eat into the workday that they will do less so they have more time to get their work done. >> thank you appreciate it. >> thanks forhaving me. maryland governor larry hogan and susie lee make the case for a bipartisan infrastructure deal. jared bernstein will join us with an update don't go anywhere, this is "squawk box" on cnbc

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a fresh start. a blank canvas. a second act. a renewed company culture. a temple for ideas. and a place to make your mark. this is where dreams become brick and mortar. find yours, on loopnet. good morning, everybody. the bulls looking to battle back from the worst week in months. bill ackman's spac is buying a 10%stake in vivendi's universal

music. the world is worried about the delta variant as the world is seeing covid cases spike. the u.k. warns summer will not be normal. we'll talk to dr. scott gottleib about it as the second hour. snmpt? >> joe is off today take a look at u.s. equity futures at this hour things are rebounding. looking a lot better than we were on friday see where things end up. dow up 176 points. nasdaq up 58 points. the s&p 500 up about 15, 16 points now james bullard here on "squawk box" sending the market into a bit of a -- let's check on

mortgage ra-- treasury rates. 10-year 1.438. today's top corporate story. bill ackman's spac signing a deal to buy 10% of universal music group for about $4 billion. the deal valuing the company at more than $40 billion. france's vivendi is spinning off which will complete the listing in late september. ackman's purchasing it and they say they will distribute umg shares after the completion of the listing. tanteen will continue to list as a remain co after the transaction. they will still have access to $2.9 billion in cash and they intend to pursue another business combination with an existing company those shareholders of tanteen

get two potential bites at the apple. tanteen became the biggest spac in september when it raised $4 billion in an ipo committing a minimum of an additional $1 billion. they represent thousands of artists. one of the interesting features of this spac, this is obviously very different because effectively they're taking a subunit of a company that was going public and effectively buying in early at a set price we'll see whether that price is as advantageous as bill ackman believes it to be. there are some tax advantages to doing it that way. we've critiqued a lot of these spacs over the years because of the way sponsors get warrants and promotes in these deals.

one of the things that was fascinating to read in this is bill ackman effectively loses the warrants in this transaction when it comes to umg so there are no warrants associated with it effectively when you talk about alignment, they are making -- his fund making an investment along with the public shareholders and that's it you're not getting anything else, which is also sort of a fascinating feature of this. it will be interesting to see if there are still warrants that will be included with whatever the second transaction turns out to be, but as we've been trying to sort through what is probably also the most complicated spac in history there are some interesting features of it. >> there are parts of it that seem better mousetrap, just sort of addressing the critique of the spac structure it seems private equityish you're taking a division, buying it this is an accelerated version

of it. this will be in public hands before too long. >> it's like a pipe investment. >> yeah. like a late stage thing. >> a late stage pipe investment in something that's about to go public it creates a floor for the vivendi shareholders it establishes it. and we'll see what the public thinks of that valuation when the shares go public. >> what's the tax advantage? i don't know that i understand entirely how that works. >> if you were a shareholder of vivendi and you were to get shares of umg, you will ultimately pay taxes on those because those are being dividended out to you effectively. >> it's not structured as a tax free spinoff, in other words >> it's not structured as a tax free spinoff, exactly. if you own shares of vivendi -- it's not a spinoff they are dividended out to you and you will pay taxes on those. if you own shares in tanteen,

you are getting them without the tax hit. i don't know if we should use the phrase financial engineering but there is a financial engineering element to this. >> you can use financial engineering. it doesn't have to be a pejorative sometimes it works here's what else is making headlines at this hour cryptocurrencies are under pressure this morning. this comes amid an expansion of china's crackdown of bitcoin mining they have expanded a ban in szechwan province. american airlines is trimming the number of flights. they are cutting the amount to 950 flights. and the tokyo olympics will have spectators at it's vents but with some limits in place. organizers will allow up to 10,000 spectators at each venue provided that a 50% capacity

limit is not exceeded. those rules could be changed, however, if covid-19 infections increase significantly before or during the games which begin on july 23rd. right now let's talk some more about the markets dom chu has been watching the charts for us. dom, there's a lot of moving pieces for us. technical things that have happened and playing off of friday's move, what happened overseas and what happens. >> what jumps out so far is the notion that you are trying to find some kind of a bid for the market overall it's not trying to be dramatic in some ways we're within striking distance of record highs for the major equity indices to show you over the course of the year to date period. this dropoff that we've seen on the right-hand side of things has been much more dramatic for the white line the dow industrials. we are 5% below the record high levels the saup is just about 2% away and the nasdaq is 1% away. even with the massive kind of moves that we saw to the down

side in men cases for many stocks last week, we were still within that striking distance. we'll see if that becomes any deeper the dow industrials the lag gar. the 10-year treasury yield has ticked a little higher we are talking about the lowest levels going back to early march. interest rates continuing to move lower the 2-year/10-year spread, the difference between that rate falls. 1.17% between that separation here bank stocks have been a key focus. what's curious now, you're seeing a little bit of a bid for jpmorgan, just about flat on the day. citigroup is running a 12 day losing streak. it's lost 16% of the value in those 12 days. cryptocurrencies in the headlines. to show you the prices again and put a couple of the stocks

around them that are going to be direct kind of i guess beneficiaries or non-beneficiaries of that move, bitcoin prices down 10%. ether is below the 2,000 mark. 1919 there litecoin and dogecoin. and to show you what's happening with the bitcoin price, we have been watching some of those bitcoin, micro strategy trades overall and micro strategy and coinbase are down in the premarket trade overall. certainly we'll watch those particular moves i would put in there some of those other moves that we're seeing >> dom, we watched overseas what happened with the nikkei a big shakeout there it was down 4% at one point before closing down by 3.3%. that definitely had some of those ripple implications to move through the treasury

market, too. >> yeah. it could be a debate about which is causing what, right? it's a safe area where people bought treasury funds and forced yields lower by the way, you can't discount there's a risk aversion in the asian markets especially if they are factoring into it. yes, there is a crackdown coming in china, maybe risk assets aren't as attractive there it doesn't mean they can't be attractive there it's a global market these days. >> you did this at the top putting these things into context. we were down by 530 points on the dow by friday.

it was the worst week that we've seen i think since the fall, maybe october of 2020. but we're still only talking about a decline of just over 1.5% on friday a decline of over 3.5% for the week we are used to getting markets going up, up, up the dow is still only about 5% away from the all-time high. >> not just that there are certain parts of the market that people still kind of keep a close eye on to figure out if they're a leading indicator overall. we are still watching the trend sports it's muddy and it's part of the covid reopening as well. we're also watching key tech components semiconductor stocks semiconductor etfs many of the big chip manufacturers like amd, nvidia there was a lot of option action around them. if you look at the way the themes are developing, you can tell right now that there are certain traders and investors, guys, who are picking spots, right? we talk about the stock pickers

market quite a bit but you can definitely see what's going on certain shopping lists there semiconductors were certainly on that list over the course of the last week and a half or so as they've kind of moved modestly to the down side if that is the case, if things are still constructive i'd love to hear what other experts are saying whether the bullish trend is still in place. generally speaking the folks i talked to are still not scared yet about any kind of a deeper pull back. if it were, remember, we're talking 5 to 8% generally being what we've seen over the course of the last 12 months or so. >> you mention nvidia and all i can think about is being excited to talk to cramer about nvidia >> oh, i'm sure and, by the way, that nvidia story has a crypto component to it. everything is so intertwined these days >> is the bark worse than the bite you'll see what i'm talking about with the other nvidia. dom, great to see you. we'll check new later.

>> you bet. when we come back, a lot more on "squawk box. the clock is ticking as political and politicians debate the infrastructure deal. we'll talk about two leaders working on an infrastructure deal suzy lee of nevada don't forget to follow our podcast, squawk pod. stay tuned, you're watching "squawk" on cnbc

21 senators and the problem solve verse caucus have signaled an infrastructure framework. a statement signed by more than 180 business, civic, labor leaders reads president biden has said america has a once in a generation chance to build bipartisanship there is no such thing as republican bridges, democratic airports, republican hospitals or a democratic power grid we agree with the president. joining us is republican governor of maryland, larry hogan, and democratic congresswoman susie lee of

nevada governor, we'll start with you there is the feeling that there is some sort of a support, a consensus coming together but we're still a little shy of the details of how exactly this would work and making sure everybody would agree once you get that hammered out. how do you think things are shaping up how optimistic are you that there will be a bipartisan deal? >> i think we're at a really good place this is something that democrats and republicans have agreed that rebuilding america's infrastructure is critically important. it's an issue that i got all 50 governors to agree on a proposal after spending a year-long initiative there's great movement in the house and senate and white house. i think it's a very important week for the president i want to take my hat off to all the folks on both sides of the aisle who have been working together it's not easy but republicans are at one end and the democratic proposal is at the other end. i'm the chair of no labels i brought together a group of bipartisan governors, senators

and congressmen to talk about this they've been working really hard and we're now at a midpoint that it sounds like we may get the president on board it's what he promised to do. he said he really wanted to work together in a bipartisan way this is our chance to do it. if we can't come together on infrastructure, i'm not sure where we're ever going to find common ground. it's great that we've got so much support for this middle ground proposal. >> representative lee, you've been in the trenches trying to work this out and make some sort of a deal happen can you give us the latest i know not all the deals are there yet but what would this plan look like if it were bipartisan >> the latest has been that we now see movement on the senate side that roughly mirrors a lot of what we negotiated in the problem solvers caucus in the house. the problem solvers caucus is 29 democrats, 29 republicans. we a couple weeks ago put forward our proposal building bridges, about 1.25 trillion

we're now seeing movement in the senate with 21 senators, 10 democrats, 11 republicans. approximately 1 trillion package. now we're seeing some movement in the senate. making us optimistic we can get a bipartisan deal on the package. >> representative lee, what have you heard from the readership, both in the house and the senate, because i think this has been a big question too. every time you have more republicans who come on board, there's the threat that you'll lose some of the progressive democrats. where does the leadership stand? >> listen, i think that in this package there's nothing more bipartisan than infrastructure i think we can all agree we have crumbling roads and bridges across this country. our waterways, our ports, there's definitely a consensus that we need to invest in infrastructure certainly a lot of is going to be the devil's in the detail, especially in the

pay fors we made a concerted effort to first talk about the size, then look at the scope. that's exactly what we're doing. this is very complicated but i think that we're seeing movement and there's certainly an appetite to get something done >> the pay fors have to be the trickiest part >> yeah, i mean, first of all, there's a slew of proposals on the pay fors i think the most important is closing the tax gap in this, and also looking at some partnerships, public/private partnerships obviously this is going to be the big negotiating part of this package is how we pay for all of this, but what we're seeing in the package that came out of the senate is $579 billion of new spending i think that's a sign that we're moving in the right direction. >> governor hogan, how important

is this for maryland what do you need in terms of infrastructure right now in your state? >> i would say all governors on both sides of the aisle really believe this is a top priority and we're pleased that we're finally making progress. this really isn't a republican or democratic issue. i think the leadership on both sides, you know, republicans didn't want to go big enough the democrats wanted to go too big to include a lot of things that had nothing to do with infrastructure i take my hat off to our group, the problem solvers caucus, which is part of no labels, and the group of the g20, group of bipartisan senators in the senate for getting us where we are. we had very encouraging news out of the white house the president sounding like he does want to continue on in a bipartisan way it means a lot it means jobs as we're coming out of this pandemic trying to grow our economy and put people to work. it's critically important. it also, i think, is the administration's chance to show that they are willing to work in

a bipartisan way as joe biden ran on, talked about in his inauguration >> representative lee, i'll ask one more time just in terms of what you hear from the leadership, what has nancy pelosi signaled? what has schumer signaled? are they waiting to see what president biden signals first? >> definitely we're expecting to hear back from the white house today on this proposal of the senate i think that that's going to be an indication of where we're heading. i know that there's definitely an appetite to get this done on a bipartisan manner, this part of the package obviously looking to reconciliation as well listen, this is the biggest investment in infrastructure that we've ever seen clearly it's complicated, taking some time. i think that most importantly the leadership wants us to get a package done and so i'm looking forward to hearing what the

white house has to say today in response to the senate's plan. >> if the white house scutless at this point, is that it? is that game over? >> listen, i don't think the white house is going to scuttle it i definitely think they've been in contact with all of us, both on the house side and the senate side as we walk through these steps in trying to get to this package. you know, the president has made it clear he does not want to raise taxes on individuals earning under $400,000 obviously we have to -- there's going to be some serious negotiations, and they take time and i think we need to look at all of this in a holistic manner and so i think we're going to see this step by step move forward. >> that would preclude if you don't want to raise taxes on anyone making under $400,000, that would preclude raising the gas tax which democratic senators have been in favor of

too, correct >> yes i think the president has been very clear that he does not want to raise taxes on those making under $400,000 the gas tax certainly would be that again, i think we have to look at all of these pay fors as a package. you can't look at one of them in a vacuum and, again, this is going to be the hardest part of these negotiations is how we pay for this. >> governor, are there any taxes or any pay fors that you would be opposed to or is it more important for you to see some sort of deal come together and some sort of infrastructure for spending get put into place? >> as representative lee said, reaching the spending number was the big first step to go from 2.3 trillion down to 1 trillion. so that's the -- where all the effort has been. but i think we can really do this without raising a lot of taxes. they met their different proposals from the house problem solvers and some of the senators there's going to be push back

from both sides about raising taxes. i'm not sure that's what america wants. private sector -- public/private partnerships is a big part of it unspent monies on other things shifting around priorities and where we're spending money can get us close we've got to figure out the last few miles to go on how we're going to come up with the pay fors. >> clever. last few miles for the infrastructure bill. governor, representative, i want to thank you both for being with us today >> thank you >> thank you. coming up, dr. scott gottleib on the delta variant and how it could impact summer travel, especially overseas. first, as we head to a break, check out this morning's best and worst performing s&p 500 stocks stay tuned you're watching "squawk box" on cnbc

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still to come, a new report this morning says that several top lordstown motors executives sold stock before the company reported results this of course just adding to pressure on the company to reassure investors after this month's dramatic shakeup stock is down by about 8

cents this morning check out that ride. we're going to be talking to phil lebeau about the road ahead when "squawk box" returns. salen from last quarter but we are hoping things will pick up by q3. yeah...uh... doug? sorry about that. umm... what...its...um... you alright? [sigh] [ding] never settle with power e*trade. it has powerful, easy-to-use tools to help you find opportunities, 24/7 support when you need answers plus some of the lowest options and futures contract prices around. don't get mad. get e*trade and start trading today.

good morning and welcome back to "squawk box" right here on cnbc. take a look at the dow up about 127 points. nasdaq looking higher. down to 40 s&p up 10.5 points show you treasury yields as well all of this coming on the backs of the conversation we had with jim bullard on friday that made lots of news and sent the market tumbling 10-year at 1.438 some corporate news for you. fascinating. lordstown motors under pressure to reassure the public and investors after a dramatic executive shakeup. admitting to inaccuracies about what it called pre-orders. down sharply after it went public with a spac phil lebeau joins us with all of the details. phil. >> reporter: andrew, we'll talk more about what you guys eluded to the stock sale from some

executives in a little bit this is the beginning of what they call lordstown motors week. as you take a look at shares of lordstown motors hovering in the $10 a range share. this is where the company is reassuring the media and by extension investors that it does have a plan for beginning production, securing capital and overcoming a number of hurdles, actually hurdles that seem to be increasing by the week here are the three big challenges in front of lordstown motors right now first of all, the company doesn't have a ceo the executive chair woman was the independent director on the board of directors, angela strand there's nobody running day-to-day operations in terms of being i am the ceo. they need to raise capital they have $500 million to get them through what they hope is the start of production and then the goal is to start production by the end of the third quarter. this is the vehicle they would be building. it is the endurance electric pickup truck what's interesting here is they said last week when they were talking with reporters in a

roundtable they said, well, we have secured workers and they were talking about that. two days later they came back and said, we misspoke. we do not have any firm orders we have expressions of interest from possible clients and the key here being once again, this is a company that is portraying orders or was portraying orders for being firm when, in fact, they were not. if you take a look at shares of lordstown motors, they are running low on cash and they need to, as quickly as possible, get some certainty about what the future holds, guys and that certainty is going to be a little bit tougher after the report this morning regarding executives, five of them, in the past selling some of their shares. >> let's talk about that, phil i'm looking at that report we're talking in total about $8 million over three days in early february >> yeah. >> does the february piece of this matter in terms of the timing of those sales? >> i think it does because

that's before they have their first earnings report. full quarterly earnings report they went public in october of last year and this was before they had their first full quarterly earnings report. when you look at some of the executives who sold nearly all of their shares, one executive in particular was in charge of propulsion that's not a good sign for a company that is just starting out that is trying to convince investors and convince wall street that this is the game plan we can build an electric vehicle. we have the propulsion system. we have the know how to make this come to market and then the head of your propulsion sells nearly all of his shares look, we're not saying that's illegal or that there was something wrong. that's for the sec to decide if they look into this, but it does not present the right image that you want, especially going into your first earnings report >> phil lebeau, thank you for bringing that to us. mike, it's a fascinating story you can imagine there's going to be a lot of eyes on it >> absolutely.

absolutely a lot of individual investors thought this company had something. we'll see if they can make good on any of that. coming up, growth stocks outperforming value stocks in the latest week. we will talk to two market watchers about what this should tell investors and whether the trend is likely to continue. first, as we head to break, check out this morning's best and worst performing dow components nike on top up almost 3/4 of a percent. stay tuned you're watching "squawk box" on cnbc

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welcome back to "squawk box. take a look at the futures right now. looking for a modest bounce after last week's losses dow up 147 points at the moment. lost almost 1200 points last week the s&p 500 up 12or 13 it was down 80 points on the week last week a little bit of a moderating bounce about an hour ago the crackdown on bitcoin mining. you see bitcoin down 8.5%.

the micro strategy it's a five-week winning streak. that's the longest since last august the ishares russell 1,000 etf fell more than 4% last week. that was the worst weekly performance since october. we're here to talk about all of this steven, let's just start with this little bit of an unwind of the value and cyclical stock outperformance it was something that's gone on globally seems to have been accelerated if not triggered by the interpretation of what the fed did last week.

value still outperforming growth year to date where does that leave you with regard to how to position? >> look. we have an economy that is seeing the most rapid shifts in history. and we are going to have markets that reflect that. i think now if we take a look there are still going to be recovery trades from this. so i don't think that what we had, what you mentioned as an unwind related to fed policy, a lot of aggressive positioning short term, that that's going to mean the end of those recovery trades but they're not long-term growth they're not long-term drivers of outperformance and will

eventually settle back into a market that has a significantly stronger component for growth. >> jacob, we do still have the u.s. economy set to grow perhaps 10% real this quarter. earnings growth for the s&p tracking up 30% for 2021 and credit conditions still look pretty good. it seems like not a lot of the major inputs have changed that much but what was your thought in terms of the market action this week and what it says about either policy or opportunities from here? >> look, i think we're seeing an unwind of the reopening trade and it's been just that. a trade. you had to know when to get in value and you had to know when to switch back to growth i have solidly been in the growth camp since 2016 the fed continues to tell us that we should be in the growth camp the 10-year continues to tell us we should be in the growth camp and i think that when you look at the value names, they rallied simply because the relative

valuations were at aye 20-year low. and now since september of 20 up through may of this year we've seen them sort of double the performance leadership of growth names. you're starting to see investors focusing again on companies that can not only benefit from cyclical economic growth but also long-term perspective fundamentals and that leads us right back to a lot of the big technology names and away from a lot of the economically sensitive names like basic materials, financials and industrials. >> you mentioned that the 10-year yield is among things that are informing you that, you know, growth seems like it's got advantages here. do you think that's strictly a valuation thing or -- in other words, it kind of makes growth stocks relatively more attractive longer term or is it telling us something about the actual economy decelerating more than expected or something like that >> i think the answer is all of

the above. at the opened of the day day it the discounting rate it makes the company's performance look a lot better. it's also a symbol of how the economy is doing as the rate starts to go up, they're looking forward and looking at how the fed is going to move. given that they've already signaled they're not looking at tightening until sometime in 2023, i think we can take some comfort that inflation is contained and that certainly a rise in the 10-year rates will not disrupt the performance of growth stocks. >> steven, how would you characterize the pacing of the global recovery? i mean, seems uneven depending where you look. >> very. >> and maybe the kind of slower nature of some of the comeback in parts of the world are also

what the bid in the bond market is about. >> that's the thing about some of the cyclical trades there are places in the world that still have only recently felt all but hopeless about covid, about reopening there are larger recoveries 2022 now if we were to take a look at cyclical value trades in the u.s. small cap market versus those in europe or latin america, for example, we progressed a lot more. and we do think that we are going to have those bounce-back effects in some other parts of the world. so part of that, again, still a pretty good opportunity. it might actually outperform growth stocks over a 12-month period of time and we haven't necessarily seen all of the upward interest rate pressure the fact that the fed will take 12 to 18 months if we have a rapid strong recovery just to get to a very first rate hike and then we'll go very slow does suggest that we'll see some

yield curve steepening again so i'm not sure that the next, you know, six months will be the period in which you can't still find some very good cyclical recovery trades, but you have to build a portfolio of a transition, right? staying in those companies that performed incredibly and protected us in the down turn in the early part of 2020 and they've come under some pressure, we can't just say that that's the entirety of the portfolio, but we should be heading back into those long-term growth opportunities. >> steve and jacob, thank you for your time this morning appreciate it. >> thanks for having me. when we come back, former fda commissioner dr. scott gottleib will join us to talk about the fears surrounding the delta variant. it's been a big issue in the u.k. they're going to keep that lockdown on. big questions about what that means here for the fall. first though before we head to a break, let's check out this morning's biggest movers on the nasdaq you see american electric leading the way for the nasdaq

100 gainers. match group also up by about .7 of a percent moderna up by about 1% stay tuned, you're watching "squawk box" and this is cnbc.

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i'm deleting it. so, break free from the big three. xfinity internet customers, switch to xfinity mobile and get unlimited with 5g included for $30 on the nations fastest, most reliable network. welcome back to "squawk box" this morning concerns around the delta virus. joining us is dr. scott

gottleib, former fda commissioner we've heard a lot about the delta variant now in arizona and now what it's doing in europe. how concerned should we really be >> well, look, there's modeling out right now making the rounds around epidemiologists that it's a consensus of 10 different modeling groups. we're getting good at modeling the virus. the scenarios are new strains that are not that transmissible and a strain that's 60% transmissible. they model two different scenarios on top of that 75% of the eligible population by november and one where we get to 80% we'll probably get to 75% or 80%. if you get to 75% with a 60% more transmissible strain, which may be where we end up, it does

show a resurgence in infection across all of the models in the fall reaching a peak of 20% of the worst of last winter the reality is when you look across the models, when you look across the states, some states show no up surge states like connecticut, vermont, tri-state region. some states show a raging epidemic alabama, arkansas, missouri, mississippi in the models shohei levels i think what we're going to see this fall, i think the models generally overstate how bad it's going to get because they under state natural immunity if you believe that directionally they're right, i think we're going to see this fall a very regionalized epi epidemic we'll see some parts that will have a resurgence of infection and some parts that won't experience much of an uptick >> scott, are those models a function of the expectation for herd immunity or how many people have been vaccinated in those

areas? is that model related to weather, which is to say that in the new york region and some of the regions you talked about people are going to spend more time outside during the summer months but in arizona, for example, you're going to spend a lot of time indoors because it's so hot and you're going to need air conditioning >> the models don't show an uptick until the fall. the reality is kids are becoming more likely to be vectors of these new variants the older assumptions of children and children driving community spread were based on the original spread of the virus. with the new more contagious variants, children and schools will become a new focal point. the models bake in natural immunity acquired from infection. a lot of them assume that that immunity is durable. they assume that the vaccines are about 90% protective there's different assumptions baked into the models.

most of it is around immunity. they're looking at patterns of immune protection within the local population they're trying to bake in behavioral aspects but most of them assume that we're not going to be shutting down and people will be behaving relatively normally. >> if you're running the fda, scott, should this change the way you think about vaccinating children and the speed and rapidity with which that gets done and the approval process? >> well, look, i don't think it necessarily impacts how fda's approached this. the fda has taken the view they want to make vaccines accessible to kids. they've approved it down to age 12 they're looking at vaccines at lower doses for kids younger than 12. the agency has shown both a desire and willingness to make vaccines accessible to kids. i'm not sure this changes the balance of the equation. maybe it tips more heavily in favor of the risk direction, the risk to children

i do think it should affect how we think about this from a public policy standpoint i think trying to get especially teenagers vaccinated is going to be important because the schools will become more focal points of spread and a more transmissible strain that affects more children, even if it's not more dangerous, you'll see more bad outcomes it's just math if more kids get infected even if the rate of bad outcomes is very low, more kids are going to have bad outcomes we did see sort of an indication of this in michigan when we saw that big surge of infection in michigan it happened around the time they opened their schools and i think the consensus was among most people that the opening of the schools contributed to that big surge that we saw. the schools did become focal points of spread of b.1.1.7 which was the more transmissible strain now we have the delta variant which is more transmissible. >> scott, there are states in texas that have effectively made it illegal to wear masks inside

schools. you remember the governor put that in place about a week or two before school was out at the end of this last year. do you imagine that those rules should change for the fall and do you imagine that students should be wearing masks indoors this fall? >> look, i think a lot of school districts are going to want to start the year and probably should with some form of mitigation whether it's masks, distancing or good, prudent practices within the schoolhouse. i think smart schools are going to start the school year with some form of mitigation until they figure out which way it goes and whether or not the models are right some show an up surge early in the fall they show it happening in the fall with the delta variant. i don't think this is a risk for the summer i think it is a risk for the fall i think the upshot is we saw a very regionalized response for the virus for most parts of the epi epidemic i think it will be more pronounced now there will be parts that are

relatively quiet and parts we see a lot of spread. it will be dependent not on policy decisions this time around but how much immunity we have in local populations. this may be a rural phenomenon now. we may see more spreads in rural parts of the country much like we saw in the midwest. >> hey, scott, one of the things with the spread in theu.k. goe back to -- we've had this conversation with you before goes back to the idea that u.k. officials decided to give everybody one dose instead of two doses of these shots because they wanted to make sure they got more of the population covered more quickly are we going to see a different sort of situation here because that's not the way we approach things. >> probably not. 2/3 of the vaccines that we deployed in the u.k. are the astrazeneca vaccine. we deployed more of the mrna vaccine. you can draw conclusions from that when you look at the overall vaccination rate in the u.k. in terms of full vaccination, they're about where we were or

they're about where we are they deployed vaccines they deployed more first doses of the vaccine, by the time this started to spread about an equivalent number of people were fully vaccinated in the united states if you look at what's happening in the u.k., 90% of the people that are hospitalized are not fully vaccinated the positivity rate is five times kids under the age of 24 so this is an epidemic in the u.k. looks like it's slowing right now if you look at what's happening there. there are some hopeful signs but it is an epidemic among schools, among younger people vaccinated. older people who are vaccinated are not the ones spreading it and by and large they're not getting as sick. we've protected the vulnerable population the case fatality is down not necessarily because this is a less severe variant. the case fatality rate are down because the people who would succumb to the virus are by and large vaccinated. >> dr. scott gottleib, thank you

as always for helping us understand what is a fascinating and an issue that's unfortunately, becky, not going away. >> no. i think it's here for a while, although things look a heck of a lot better now than they did a few months ago. when we come back, we've got the latest on the infrastructure debate in washington we'll be talking to jared bernstein. he's a member of the president's council of economic advisers today we are expecting to hear back from the white house on the bipartisan plan that's been put together in both the house and the senate then later marked watcher mohamed el erian will help us get ready for the week ahead lots to talk about what's happening with the bond market right now, what's happening with ayuities, inflation and the fed. st tuned, you're watching "squawk box" and this is cnbc.

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trillion dollar infrastructure bill any time now. just moments white house council of economic advisers are joining us to lay out the top priorities as the final hour of "squawk box" begins right now. good morning, everybody. welcome to "squawk box" here on cnbc i'm becky quick along with andrew ross sorkin and mike santoli is here at the nasdaq market site in times square with me today joe's off, but he'll be back tomorrow also keeping an eye on the u.s. equity futures very different than this time on friday this morning dow futures are indicated up by 180 points that comes after a decline of 533 points on friday the decline for the week, dow off i think it was by 3.8% for the week to date last week

it was -- yeah, 3.4% that comes as the weakest level we've seen, biggest decline we've seen since october of 2020 in terms of just the week for the market nasdaq right now indicated up by about 29 points. the s&p indicated up by 13 if you check out things in the treasury market, you're seeing interesting plays with yields there today too. the 30-year bond is sitting at 2.072% earlier it was below 2%. the 10-year yielding 1.44% but then on the shorter end of the curve you have seen an increase. the 2-year yielding at 0.268% and 5-year yielding 0.891% after the fed indicated rate hikes could come sooner rather than later. by sooner, we don't mean this year, we mean maybe next year. a crackdown in cryptocurrency mining in china putting pressure on digital coins this morning you can see across the entire

complex here bitcoin off by 7.75% weakness across the board there with dogecoin down 15% microstrategy falling too. that company is one of the biggest corporate investors of bitcoin down 7.5%. microstrategy came out with an announcement moments ago that it purchased even more bitcoin. we'll have a live report on the latest crypto developments coming from china in a few minutes. andrew >> meantime, there are a couple of other big stories we're going to be talking about this morning. a spac controlled by bill ackman finalizing a deal to buy a 10% stake in universal music group vivendi. it values universal at $40 billion. 35 billion euros the label is the world's largest music company with artists including taylor swift, lady gaga and dre they plan this in amsterdam.

shareholders of tanteen which is bill ackman's spac get access to that at a set price now. we will see where it does trade. there's some tax benefits and other things and a second crack at the apple which is what maybe we'll talk about a little bit later. american airlines canceling hundreds of flights. 180 flights canceled yesterday american says that represents 3% of the total flights staffing shortages with the demand are creating headaches. american planning to cut 1,000 flights during the first half of july remember the ever given? that's theship that was stuck in the suez canal for days disrupting shipping and supply chains across the globe. what you may not know is that the ship is still, still being detained amid a dispute over

compensation for damages now the authority demanded $916 million to release the ship and lowered the demand to $550 million. the ship's owner countered with $150 million now its lawyer says that a new offer has been made but didn't specify the amount so a bit of -- like a pirate situation. >> you know, that's a good question that was -- that's a huge ship that's one of the largest ships out there and you do start to wonder, can these things make it through canals like that who's at risk if it becomes stuck or if there's a problem with it. we still don't know exactly what had happened there was talk that maybe there was a situation where computers took over and that's why it wound up stuck in that position, in that precarious position. somebody's got to pay for that the damages are huge and then you have to wonder about the value of the ship itself if it was over $500 million, which is -- just say, forget it, keep it. plus all the stuff that's stuck

on it. if you're missing an amazon package, maybe you know where it is now >> we'll see anyway, we showed you the stock futures just a moment ago. they are pointing higher after that big drop on friday. the question is, should we be expecting more volatility in the week ahead mike's been looking at how we're positioned as we head into monday's trading by the way, mike, this was not the sell in may go away type of summer what about the rest of the summer before we get at least to jackson hole >> well, so it wasn't sell in may in the sense that may itself was strong, however, the market right now remains at levels that we were at back in mid april so keep in mind we flattened out a lot of the s&p 500 before we had last week's loss now we're still less than 3% from all-time highs. take a look here that doesn't look like any dramatic decline because the market had stagnated for a couple of months, it broke below the 50 day average that's not so fatal. the average is going lower we broke below it in february

and rebounded from there so it's nothing that is a major change of trend but underneath the surface a lot more stocks are down about half the s&p 500 stocks are down 10% from a 52-week high we've gotten oversold by some measures a lot of focus here buying in 10-year treasuries, compressing that yield not just last week but since march. definitely rotation into bonds people feeling they don't own enough relative to how well stocks have done if longer term inflation expectations are diminishing off the mini panic levels. that's going to place a bid there. one of the reasons a lot of people who looked at this chart feel like there's some suspense here we spent almost no time between call if 110 and 145 where we are right now, 140 so it seems as if, you know, we have a lot of evidence of exactly where its supply and demand were because the shot up was so fast and so steep so it's still retaining the look

of an up trend it's a little bit nip and tuck whether in fact it is the up trends if we go a little lower from here it has to test the breakout levels perhaps take a look, too, at amazon. prime day today. i pointed out before as much attention as the retail side gets, look at how amazon shares over the last year have traded with the cloud software etf. it looks really similar, right the cadences doesn't mean aws, amazon web services is the most important business but it seems like the marginal kind of driver of the valuation of amazon, at least right now since we got such a pull forward on the retail side of demand in the pandemic, becky. >> cloud computing how does that work i mean, how much is amazon part of that index? >> it's not. i don't believe amazon is -- well, if it is, i think it's an equal weighted index it's not dominant at all it's much more about the fact that the stock seems to actually kind of just move along with those cadences right now. >> that's interesting and i

guess it makes sense amazon makes more profit from that section than the retail sector >> exactly we did get a little bit of a come down in valuations. they ran up so far in 2020 it's been the consolidation in both of those trends. >> mike, thanks. see you in a second. >> andrew, we'll send it over to you. >> thanks, becky. meantime, president biden said last week he could respond to a roughly $1 trillion infrastructure proposal from a bipartisan group of senators as early as today joining us to talk about the current thinking inside the administration is jared bernstein. a member of the president's council of economic advisers jared, great to see you this morning. let's just sort of set the table for the state of play. where are we really? >> well, we have a set of negotiations that are ongoing. they're making progress. you've heard the readouts from some of these meetings the president couldn't have been more clear about two red lines in the sand for him. one is inaction is unacceptable. you and i have talked about the

need for investments in infrastructure, in r&d, electric vehicles, in clean energy for years now and this president deeply values and understands the importance to our economy, to our productivity of those investments. the other line in the sand is of course no tax increases for anyone under 400,000 now both sides say they want to make sure this agreement has some pay fors and that is still clearly under negotiation. >> when you talk about inaction, i appreciate that idea that you don't want to have inaction, but the question is -- and i know you don't want to negotiate this on television, but in terms of the numbers, right, you know, $4 trillion up here, 1 trillion down here, lower even down here depending on who you talk to you know, where does inaction stop and the president decide i'm going to take over >> well, i thought you saw some evidence of that with the negotiations with senator

capito the negotiations just weren't headed towards a number that was acceptable to this president now we have a set of paths that we've been talking about the bipartisan group in the senate but there are numerous other initiatives afoot here i think preserving option ality. politics being the art of the compromise, but the president has been clear in his words and his actions that the kinds of investments and the depth of investments i talked about in my first comment, those are -- they must be part of this >> jared, what is the administration's view of the prospect of inflation right now? i know that you've talked about it being transitory, but clearly jay powell has made some at least hints that there are concerns about it. we had jim bullard on the program on friday. he was much more hawkish about

where things stand and so even if the fed effectively were to be taking its foot off the accelerator, there's the possibility you may be putting your foot on the accelerator. >> i'm glad you gave me a chance to talk about that i have two points that i think have been not quite fleshed out enough about this. first of all, my interpretation of the fed vis-a-vis our policies, i'm not going to get into fed policy, of course, is that this is evidence that the rescue plan has done precisely what this president intended it to do, with shots in arms, with checks in pockets, with getting families and businesses to the other side of the crisis, what have we done we've pulled this recovery significantly forward. look at the forecast for gdp look at the forecast for getting back to full employment to a 50 year low in unemployment rate faster than anyone expected. what the fed told us the other day is this plan is working. i don't think what they did is a sign of anything other than the recovery has been pulled forward and the federal reserve monetary policy can normalize sooner than

expected on inflation, let me give you a couple of numbers here so the federal reserve predicted the federal inflation would be in the pce core, would be i believe 3.1% this year and 2% next year. it's a little early in the morning from calculus but let's move from first derivative to second derivative. the over heating story suggests increasing over the years. it would have to be higher and what the fed told us is that their story on inflation matches very much that of most forecasters, including ourselves, which is one of a lower inflation rate in '22 versus '21. this is unfolding much as myself and my colleague ernie tadesky explained in a blog a month ago. we see this occurring much in the way we described. >> jared, i know you look at the world and say tight labor market

is a great situation. >> i do. >> there are other business leaders who say tight labor market means wages go up, which is why i know you like it, but also it means that prices go up. we watched even over this last weekend american airlines slashing and halting some of the flights that they had planned because of the labor shortage. what do you make of this situation we're in right at this moment >> the president has said some things about this that, as you suggest, are absolutely beautiful macro economic music to my ear. that is, he's talked about the importance of getting back to full employment, something i just mentioned, something i think you can read out of the fed's sep from last week, getting back there sooner than expected in no small part because of the help of fiscal policies from this administration we've added 2 million jobs in the past four months average job growth, 540,000 per month. that says people are coming back into the job market, they are getting jobs the american story you told

about, the airlines story, that's real. we've consistently talked about the misalignments, about the bumps in this road as strong demand pulls in supply, but what i see is the market that's responding to price signals. that doesn't mean it's a smooth path there will be bumps. this recovery is underway. it's underway strong i believe that some of the supply chain complaints are showing some signs of ameliorating. >> speak to this though. we have seen also some signs of i don't know if we're going to call it a bubble, despite what took place in the market on friday, there's a lot of liquidity in this market right now. the question is, of course, whether what's happening here is pushing things to places that they should not be going how concerned are you about that >> well, i just listened and watched as you talked about the trajectory on the 10-year yield. that's telling a story

when the job market is heating up the way it is, folks are coming back to work, getting jobs that are paying a little bit more because they have a little bit more bargaining power. at the end of the day this is still a 70% consumer spending economy. if people are coming back to work, getting better paychecks, we didn't have a chance to get into this, but it is child tax credit awareness day at the white house, we're talking about a new policy that's going to get 39 million households covering 65 million kids their child tax credit in an advanceable early way through direct deposit or through the mail, and so in an economy that's almost 70% consumer spending with a policy that's going to cut child poverty in half, we view this as extremely positive from the perspective of americans who really keep this economy going the middle class, lower income households, that's the way we see that >> jared, final question that i was not planning to ask you but

now that you've mentioned the child tax credit, it's a tax question and i'm sure you saw that propublica piece a few weeks ago that went through some of the billionaires that had their net worths go up during this period and paid very little in taxes including in certain cases no income. jeff bezos one year played no income tax and claimed the child tax credit which made me think of this. how do you think the tax policy should address unrealized tax gains for those wealthy -- wealthy enough or those who get unrealized tax gains in the form of stock but don't get actual income, should they be paying taxes? >> yeah, that's a great question, one we could talk about for a while. before i get to that, i will give you an answer, i do want be to make clear that with the announcement of the child tax credit going out for people who have signed up for this, that child tax credit.gov, your

working families get the full credit if they make up to 150,000 for a couple with kids and 112,000 for a single filer, so people in the stratosphere are not going to get the full credit or in some cases any credit at all. in terms of taxing unrealized gains, one of the proposals that this president has long stood for is the step-up basis, is getting rid of the fact that when you inherit capital gains whose assets have appreciated, you can write off the basis -- the increase in the basis if that asset went from 200 to 500 million, you know, you no longer can just claim it as 500, you have to pay that step-up basis if your income is over the line that we've talked about today. >> right >> so, yes, i do think there is some role, especially when it comes to step-up basis this is a proposal that biden himself has gotten behind. >> jared, it's he a longer

conversation i hope we have an opportunity to do it again. looking forward to seeing you. thanks for coming on this morning. >> thank you, andrew. >> mike, it's fascinating. >> all of it is, absolutely. thank you, andrew. coming up, we'll get back towards the markets and al allianz's adviser mohamed el erian will join us nge. the sound of a thousand sighs of relief. and the sound of a company watching out for you. this is the sound of low cash mode from pnc bank, giving you multiple options and at least 24 hours to help you avoid an overdraft fee. because we believe how you handle overdrafts should be in your control, not just your bank's. low cash mode on virtual wallet from pnc bank. one way we're making a difference.

all right. welcome back, everybody. target and walmart getting in on the retail extravaganza sparked by amazon's prime day. courtney ragan joins us. she has more on that front good morning, courtney. >> reporter: hi. good morning, becky. good to see you. not only walmart and target but it's estimated hundreds of retailers are or have held their own sales events to compete with amazon prime day it's become an expectation for shoppers nearly half according to adobe while it is worth while, retailers sales over $1 billion saw a 10% higher increase in sales online during prime day

last year compared to smaller retailers that are still trying their best to compete. and if you're a brick and mortar retailer with a buy online pick up in store option, conversion is actually twice as high. shoppers are smart they're going to check competitors to make sure they're getting the best deal. a.m. amazon is 48 hours into the prime event. walmart has been holding deals for days and that includes online and in store. target is in the middle of the three-day deal days. best buy has several competing events there was a summer tech flash sale friday and a bigger deal sale running for eight days leading up to and through prime day. and while there's a halo effect for the retail sector on and around prime day, expect amazon to break its own records again and have its best day ever while its growth rate year over year has fallen prime day to prime day, emarketers still estimate the event will generate

about $11.8 billion. becky, back over to you. >> so when did amazon announce this was going to be prime day and did everybody else announce right after that were they all kind of just waiting and watching >> reporter: yes they only really give us a couple weeks of a heads up and when it began, it was almost always in july because it marked -- >> yeah. >> -- amazon's 20-year anniversary. last year it moved to october because the pandemic made everything a little whacky this year it was a real tossup when are they going to do it again. they announced it only a couple weeks ago and from what i understand, retailers sort of had their promotions waiting in the wings ready to roll out once they know the timing of the amazon event and some retailers have had more success trying to do it before amazon's event others like to do it during because consumers can check prices, because of the dynamic

pricing that is integrated into all of these websites that sort of help price match automatically so they can get a chance to win that sale. >> for prime day you have to be a prime member do you have to be like a walmart plus member or any of those other things to participate or is this for everybody? >> reporter: so that is such a great point because for the walmart events and for the to be a target red cardholder. you do not have to be a walmart plus member. those events are for everyone. i believe i mentioned walmart's deals are also offered in store as well as online. but for prime day, you do need to be a prime member that's sort of the point of it i mean, when -- >> right. >> reporter: when they started it, yes, it was an anniversary sale but it was to get you to be a member you're going to see the best sellers be those amazon devices, echo devices, kindle devices they want to keep you in their ecosystems they're going to offer you a great deal so you keep using all

of their devices and that flywheel keeps rolling. >> court, thanks great to see you. >> reporter: thank you you, too. coming up, we're going to take you inside china's expanding push back on cryptocurrency and what it means. bitcoin, ether and the others all taking big hits today. a live report nt enisexwh "squawk box" rolls on. one 12 prg on us. and with our new magenta max plan, you'll get unlimited premium data that can't slow down based on how much smartphone data you use. and taxes and fees are included. that's right, unlimited premium data and up to 4 iphone 12 pros on us only at t-mobile. the leader in 5g ♪ ♪

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welcome back to "squawk. bitcoin, ether and other popular cryptocurrencies are in the red. traders focus on a growing crackdown. eunice yoon joins us with the latest from beijing. eunice >> reporter: thanks, andrew. so alibaba's ali pay and several chinese banks are right now reminding their customers to stay away from virtual currency trading. ali pay has been warning its merchants as well as customers that they risk having their accounts restricted. china constructs and the agricultural bank of china say their customers can have the accounts suspended, financial services terminated immediately or potentially be reported to the authorities. this comes after the people's bank of china summoned several financial institutions to discuss what they said are the dangers of trading in cryptocurrencies now the policies themselves are not new but we have more detailed instruction

so here's one of the key points. one is that institutions should now try to identify which accounts are active in crypto trading and then, number two, block those transactions so that's one of the reasons why you're seeing a lot of nervousness here in trade and also we -- over the weekend officials clamped down on crypto mining projects in one of the biggest bitcoin mining areas in the country. in szechwan province there's one country in particular said they're hoping to end all of these mining projects in bitcoin and in ether in the next year or so then the communist party paper the golden times said this would mean that 90% of the bitcoin mining capacity would be shut down where is that business going we've talked about this before on the network, that some of it could be going to the u.s. or elsewhere.

we spoke to logistics company in guangjo and they said they shipped 3,000 kilograms, kg -- or 6600 pounds of bitcoin mining machines to the state of maryland so somebody in the united states is picking up some of that business >> picking up some of the slack. long term, eunice, are you a believer that bitcoin will be demonstrably outlawed in china >> i know if a country is trying to quash something like bitcoin, it gives it more value that's bulls of bitcoin would say. >> yeah. well, as you well know, the chinese government doesn't really like anything that it can't control. bitcoin being one of them or cryptocurrency trading and i think that was what was really interesting with the pboc's action, that we could see that they are's trying to target

and maybe perhaps scale the regular chinese cryptocurrency traders. there are a lot of people who are dabbling in it, who see the potential in it and so with these latest changes, they're kind of closing loopholes to make it much more difficult for regular chinese to be able to get their hands on these cryptocurrencies >> okay. eunice yoon, great to see you. thank you for helping us through that mike coming up, we'll get you set for the trading week ahead you don't want to miss expert market analysis from allianz adviser mohamed el erian he'll tell us what to expect from b aig week of fed speeches including fed chair jay powell stay tuned, you're watching "squawk box" on cnbc

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welcome back, everybody. the tau as you know lost more than 500 points on friday to close out its worst week since last october somewhat of a hangover in the asian markets with japan's nikkei down by 3.5%. the hang seng was down by 1% it hasn't carried out over into europe the futures are poised for a pretty healthy open at this point. joining us is mohamed el erian

he's the adviser at al and and grammar c. mohamed, this is something that you've been saying for a while, that the fed should move and that they should move quickly in terms of reining in some of the excessive sort of extreme measures we had bullard on, the st. louis fed president. he kind of said that's what they're thinking about they have changed their minds over the last couple of months about what's happening with inflation and that you might actually see them start to raei in some of the big qe measures that spooked the market for some reason, although i'm not sure why because it's basically the same thing that was telegraphed if you were looking at the dot plots on wednesday how are you feeling about all of this what do you think is happening >> good morning, becky first of all, the market's initial interpretation, which for me was strange, what the fed announced was surprisingly hawkish. there should have been nothing

surprising about it because the fed was simply marking its projection to market, taking the gdp growth to 7% is no big surprise most private sector forecasters are there. taking pc inflation to 3% is no big surprise nothing surprising about it. hawkish, no? it wasn't hawkish. hawkish is when you start tapering so the initial reaction was, oh, this fed is being hawkish. i think this has now played through. it has left quite an impact on the shape of the curve because they moved on rates but not taper and the curve changed completely in terms of the yield curve. now going forward, i think the market is getting back into the comfortable mode growth is strong inflation is transitory. still believes the fed is going to be relatively slow in tape perfecting and that's why you're seeing what futures are doing what they're doing >> to me, what bullard was

saying was being realistic about what's happened and where things stand. it deparidn't come as a surpris me either. once you see the moves take place do you think it builds on it self or it will jump and we'll sit here. >> there are three views out there. we're going to hear from fed speakers and first it's going to be chair powell and new york fed president williams they're the most important they're going to tell you monetary policy is just right. those people, including james bullard on your show on friday, who think that maybe we should be little bit more hawkish and then there's a small minority of people who think that the fed is being too hawkish. my own view is what is your probability of the fed being right, 35% what's your thought about the fed being right?

50%. and 15% too early. i think the fed is being too slow but i think you'll find chair powell is going to have a lot of challenges in keeping the unity of the fmoc here. >> is there a problem with that? it's nice to see people breaking out and having a little bit more debate >> it is nice if markets hadn't priced in the two big measures of the fed which were inflation is transitory and we're not thinking of doing anything with monetary policy for a while. that is really underpinning a lot of market positioning. so that's why this is a really delicate period for the fed. it needs to become a little bit more hawkish but it doesn't want to do it too quickly that's a pretty difficult balance to navigate. >> mohamed, obviously there are feedback loops here. so just as all of this happened, we got that reflex reaction, maybe an exaggerated one by the markets, you know, the market implied inflation expectations came down quite a bit.

we did get a lot of the crowded positioning in the cyclical and value assets cleaned out probably last week so in a sense the markets have bought the fed more time we no longer seem like we're in that mode of over anticipating an inflationary burst here >> that is certainly one interpretation if you want to start a really heated discussion among economists and market participants, ask them to explain what just happened and what's ahead you get lots of views. these are very technical markets right now, and we just have got to respect they are technicals and see that go through and then we'll be able to be in a better position to assess what's going on i think the concern that you still have out there and the reason why longer term inflation expectations came down, the reason why the 30-year moved in a major way, the yields came down in a major way, while the 5

year and 2 year went up is there is a concern out there that the fed may have to slam on the brakes down the road, which means you get more inflation in the short term and you get the risk of lower growth and inflation coming down sharply in the long term. that risk is still there, mike. >> mohamed, would you touch sovereign treasuries at this moment especially the longer term ones. >> so i wouldn't, but, you know, i understand why some people may feel compelled to do so. and i certainly wouldn't after the move that happened on thursday and friday. i think that i certainly am optimistic about the longer term growth of this economy i do think this economy is going to run a little bit too hot on the inflation side but i'm not willing to say the fed is not going to adjust in time. there's still scope for the fed to adjust but they have to get moving in a more serious way

>> thank you it's great to see you, mohamed >> thank you >> we'll talk to you soon. andrew coming up when we return, we're going to talk to our good friend jim cramer and get his first take on the trading day ahead -- trading week ahead. then one of the street's top technicalable lists will help us understand friday's big market drop you do not want to miss atth stay tuned, you're watching "squawk" on cnbc - you should te. - ten-x it? ten-x is the world's largest online commercial real estate exchange. if i could, i'd ten-x everything. like a coffee run... don't just sell it. ten-x it.

that's a nice way of saying they're going to recognize it. the americans tend to play and they're doing anything to get it rolling. the guys who really dominate are

china and i think the prc's had enough of this i don't think the -- the prc is coming down on anybody who's capitalist who they don't control and i think we should all recognize that president xi is not like anybody else and i don't think he's a big bitcoin fan. just one man's thought. >> so, jim, then the question becomes what is the fair, proper valuation for bitcoin under the assumption, if you want to make it, that the chinese get out of the bitcoin business >> well, i don't now look this is a crucial level. tom demark did a piece about this he's been unbelievable basically it has to hold 30,000. if the chinese flee the market, i don't know how that can happen because they're so dominant. they're stopping cities that have good hydro power. i mean, from mining bitcoin. i mean, guys, i don't think we

really know what the chinese are doing, but it isn't good and i think that if they can bring down a market, i think they'll do it. they don't want this market, andrew they just don't want it. >> but, jim, there are folks this morning who are saying to themselves, am i buying this quote, unquote, dip, is this a dip, or is this something much more systemic in which case i should be selling? what would you be doing? >> if it holds 30,000, we'll know this is the crucial level. this is the level that demark was talking about. the reason i say demark, he's been dead and all of this. this is like 1929. this is the level that would have held, a chart that looks like 1929. i actually think it can bounce because the chinese do certain amount of damage and then they walk away. and then they come back. but there needs to be more american adherence there needs to be more money spent. more money coming in right here in order to be able to save it that's how i really feel

novogratz has got to come on today, right >> i'd love to hear what he thinks about it. i know a lot of bitcoin bulls that would say, look, the fact that china wants to shut this down actually means it has value, right you've heard that argument before >> yeah. the chinese like anybody we deal with, if they don't want a market, then they arrest people. that's it. i mean, you know, we've had, what, joe tsai talking about who was laying low >> jack ma. >> jack ma. >> jack ma laying low. well, that's just perfect. how about if they decide to lay low the people who buy bitcoin i mean, we have to start taking the chinese a little more seriously in terms of being cold war yours. this is something they can't regulate wait until we see john donohoe, how he feels about religious freedom in china

china's a different place than what we thought. i think it's amazing when we had james on he said lockheed martin, the biggest threat is china. there it is, okay? lockheed m lockheed martin talking about china, i think we have to wake up to this. >> jim, i know we're going to hear more about this in a few minutes. before we go, i wanted to talk about your father's day present, which is the best present i've seen yet >> courtney rot wiler was about to be whatever they do, at a kill center in tennessee we adopted her and i urge people -- i know everybody would like -- no, i know a lot of people want a pure breed there's nothing like getting a dog that is going to die if you don't rescue it. and that's what i urge people to do it's our second dog and this is -- it's navidia

how can you not name a dog after navidia. >> that name is claimed. >> i got a rescue cat in october. >> there you go. >> they're grateful. they love you. they're the most grateful pets in the world >> exactly everybody had -- before they're euthanized, please adopt them. thank adopt them. thanks, jim. we'll see you in a few seconds >> thank you. well, with last week's dow performance, the worst since october, seems like exactly the right time to do technical analysis and find out what the charts are telling us. joining us now for that, katie stockton good morning good to see you. >> good morning. you, too >> so, you know,ist interesting. s&p 500, it's not even 3% off its high but there's been a little wear and tear under the surface. where do you think that leaves the market field positionwise, are we due for a bounce even if we're not that far from the highs? >> i actually think so just based on what we're seeing as of last friday, the s&p 500

came down below its 50-day moving average believe it or not, that 50-day moving average has provided support since november and by that, i mean you don't see it break on a consecutive closing basis and we actually haven't seen a short-term oversold reading from the s&p 500 since that low in november was established. so it means we have a market that doesn't necessarily need to get to oversold to keep going and forge higher so, based on that and based on the fact that some measures of market breath are anticipation, things that measure advancers and decliners got pretty oversold on friday in fact, it was the most oversoled since may 12th and none before march 24th, both short-term lows for the s&p. i think we'll see a rebound this week and that should reserve the short-term that's in play. and the cyclical sectors that have seen this rotational pullback, they're also showing some signs of short-term downside exhaustion. they are short-term oversold

at least due for a little stabilization. >> to that point, do you think it represented a decisive break of that leadership from cyclical and value stocks or is this just going to be swapping back and forth the leadership baton between growth and value for here on out? >> it's really sort a macro technical set under way. the 50-day moving averageses are highly publicized support. it was concerning to see a lot of commodities break their 50-day moving averages benchmarks like xlf representing the financials these breakdowns are minor in nature you have to look at them within the context of the uptrends that preceded them. leveraged to reflation trade, leveraged to commodity prices had done well for several months some row tracement is probably healthy. things like copper, support is

10% low so we could see these areas out of favor indeed, as you reference, there is the possibility for the major indices to still forge higher. i think they will do so for the fact that the mega caps have kicked back in we have the faang, plus tesla stocks now posting gains in a tape that's very weak otherwise. that can help these major indices to which they're heavily exposed to mega caps forge higher we've seen the s&p reach a new high and there's nothing bearish about new highs. >> that's right. while we have you, can you handicap the crypto move this morning in terms of bitcoin where it is relative to levels it should hold >> as jim referenced, tom is looking at support levels in play we also have, based on his indicators, new signs of short-term downside exhaustion as of today in ooetder, we also

have a signal in bitcoin that suggests this downdraft may be overdone it doesn't mean you rush out and buy into weakness because a lot of the cryptocurrencies are below support at current levels. it suggests in coming days if we see a little bit of a rebound, we probably have another opportunity to add exposure, at least with the short-term time horizon. even with the declines we've seen over the last couple of months, their long-term uptrends are largely intact. >> based on what you said about commodities having those great runs and their pullbacks don't necessarily mean game over, does the same go for treasury yields now? >> treasury yields have obviously had weak intermediate momentum for some time they're not without support. i think pg we're probably just going to see more side ways to lower action there and certainly the implication cans are greatest for bank stocks otherwise, interpretation is mixed.

we're all left wondering what the impact is on the technology sector as a whole, but, really, let's just stay with what's working. of course, that's the mega cap, sort of the more defensive areas within technology and even on it is high growth front, we are seeing solar stocks at breakout. we're seeing some software stocks break out i want to stay with that trade >> all right, thanks a lot for running through all that with us appreciate it. when we come back, we have top stocks to watch ahead of the opening bell stay tuned we'll be right back. these days you have to keep everything moving and reinvent the wheel. with a hybrid, you can do both. that's why manufacturers are going hybrid with ibm. with watson on a hybrid cloud factories can use ai to automate the little things so they can focus on the next big thing. businesses that want to innovate

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here we go ation more than half an hour to go to the opening bell on wall street dom chu is looking at premarket movers. >> we're watching shares of uber they've had a nice run over the last year. they're up about 50 some odd percent in that 12-month span. they're up fractionally or flat on the day so far, but analysts at bank of america are calling uber one of their top picks in the sector coverage. uber, they say, is wrought with

a number of second half catalysts on the regulatory business we're watching uber now. just about flat in the premarket trade. also keep an eye on what's going on with cryptocurrencies we've been talking about it all morning. microstrategy, because it's down 8% but its ceo just made material disclosures about the financials of the company. he basically tweeted out that they were adding to their bitcoin positions on the fall. they added more around the 37,000 and change mark, which brings their total position to around $2.7 billion at a cost basis over 26,000 per token. he tweeted out there so watching microstrategy. bitcoin, downside this morning, still down 9%. 32,000 and change according to coin metrics we've seen a pullback off the highs. it was 60,000 per token -- or per coin back then watch for that, becky. back over to you.

>> thank you. very quickly we'll take a final check on the big markets on the major averages. you'll see dow futures indicated up by 218 points the s&p futures up by 17 the nasdaq up by about 28 points making up for some of that ground lost on friday. mike, i want to thank you for being with us several days this week and last. great to he soyou. andrew, i'll see you back here tomorrow right now it's time for "squawk on the street. good monday morning. i'm "squawk on the street" at the new york stock exchange. dow futures look to bounce from a five-day slide another busy week ahead. fed chair powell in front of the house tomorrow our road map begins with the bulls battling back. stocks look to rebound from the worse week in months bill ackman is back buying a 10% stake in the