bulls out there. you're going to see this morning there are green arrows again the s&p 500 closed at a record high on friday it's indicated up another seven points today dow futures up by about 26, the nasdaq up by 56. big first half the s&p actually looking at what was the best week since february, record high. we'll see you back here tomorrow bye, everybody "squawk on the street" starts now. >> good monday morning, welcome to "squawk on the street." i'm carl quintanilla, with jim cramer at the new york stock exchange final week of with q2. it will be busy. jobs friday, we're going to watch some crypto, some infrastructure, pharma, even some good old fashioned weekend box office our road map this morning begins with the market records. s&p 500 is try to hold onto new highs coming off its best week

since february >> plus, we've got boeing under pressure this morning. the faa signaling that the company will likely not receive certification for its 777 x long range aircraft until mid to late 2023, and that is at the earliest and gene editing, it's arrived, guys research report positive results from the first in-human trial of a treatment for a genetic nerve disorder carl those stocks, at least some of them are soaring. >> yeah, jim's hot to talk about that although, this midway point of the year, jim, is going to give us a chance to put the first half into some perspective, right? >> it is -- it's tough not to be bullish. i know that mike had a good piece about how it's a choppy time i would come back and say there's no real earnings news. we do have some news that i think might stay hot, might still put some pressure on jay powell, but a note about this

weekend, very interesting about that it's temporal, so you got that going there is a lot of kind of extraneous news. you talk about the memes, crisper that is very positive for highest growth i don't know, because we have to do our own allocations, i took some money off the table just because of my age, i regret it i regret it. not because i'm going to live forever but because, you know, darn it. i can't stand the fact that i got a little older because this is one run david, i've got to tell you, don't get old and stay long. >> unfortunately, there's nothing i can do about that first part there, jim, but you know, your point's a good one although we do tell people to allocate appropriately for their age. jim stewart comes on all the time talking about things of that nature, and it's good advice even if it's tough to follow it.

>> it's funny you mention that because jim and i and his par partner, all we could do just talk about how because we got older. of course he got younger, but as we got older we had to start re -- you know, kind of questioning how much we own because we all have, you know, issues where you don't want to have to get rich twice but i got to tell you, carl, this is one of the more buoyant markets i've ever seen, and as far as i'm concerned, taking money off the table is not advised right now. >> it's actually a really interesting point, jim especially the way that growth is going to finish the first half with some momentum, up for the month almost 5%. values up less than 1. the market seems comfortable with the perceived rate of hikes, the idea that these price increases will fade over time, as you mentioned, goldman reiterating i think year end

target on the ten-year 195 jpm, same story. >> look, every time i want to go really bullish something happens on the commodities side. the temperatures for corn. corn is a popping where you have it so perhaps corn could be a new problem just as we conquer the chip shortage, which i am telling you is coming to an end. which is great for autos steel still flying, but iron work come down a little. i think that paper stocks are starting to move, but chemical's starting to go down a little so my ultimate sign is that it is temporary, powell will win, he wants to get -- wants to at least get to october when we see how well new jobs are -- whether jobs can be filled now, there are dispute about the states that have let the expiration of the benefits, some say that it's really allowed

people to get jobs i was with my manager this weekend, and he said, you know, we're all hoping in the restaurant industry that somehow, carl, there will be more people who really want to go to work because everybody's shorthanded. >> yeah. david, it's interesting, there's a good piece i think in the journal today looking at states where they have cut the suppl supplemental we'll see whether that makes itself seen this friday. i think already 800 k, morgan stanley 620k you would be looking at some -- if that comes true, some net acceleration from the prior month. >> yeah, you just mentioned the big numbers and i saw that b of a number as well, the 800,000. i'm sure you both saw the different takes on the states. i think the "new york times" had a different take than the journal did, carl, in terms of the same data, which is always fascinating. jim, you talk about supply disruptions. we had a full screen up there in terms of the supply chain. that may run its course, but it

doesn't mean that it isn't quite frustrating right now for a lot of businesses. it is a mess out there, and it's across the board, you know, it's in dealing with so many different industries right now where there are significant disruptions in getting goods into stores and goods to people. >> boy, david, you're so right i read, too, the "new york times" saying, hey, listen, no help, and the journal saying help david, this port issue, which we keep thinking has got to go away come on, can't just solve anything like this with technology it is not stopping also, we should note, i mean, china's back with covid. rush has got a lot of covid. indonesia with covid what's happened is when china has covid, they shut things down, and you're talking about bringing in stuff for christmas right now. i know the rails are being hurt by it. i know union pacific, i'm concerned about jb hunt positive note today, we need truckers,

and they can raise rates carl, one of the things that amazes me is there was something the president said last week people are asking about this, and he whispered pay people more maybe that's what has to happen. you have to pay people more, they will find a way to get truckers the president then in the same sentence, in the same paragraph, then kind of ruined the infrastructure looks like it's back on. you had to watch the sunday shows to see whether things were back on. >> they did clean some of that up. >> to your point about the jobs number and infrastructure, i guess, i don't know, i mean, we were thinking that q2 would come with a lot of margin commentary, conference calls talking about price pressure nike, darden, and fedex all closed the week higher last week. >> look, the fedex was really incredible here we had a lot of people saying it wasn't a good number david, i read every piece of research from fedex, plus the conference call where fred

started saying we're having some labor issues darden, they have to hire more people fedex has unbelievable because of e-commerce. e-commerce has sopped up a lot of hiring. i come back and say these were companies that i thought were going to create a narrative that made you think that things had to get tough out there they're not, david these companies are passing it on they are making a lot of money, and they are winners, and those are stocks that i want to own. let's not forget, these are companies that have stocks fedex is going much higher, okay darden is going much higher. why? because they are winners in their categories. >> you'd question that move down initially in fedex on friday after the numbers. >> yeah. >> and of course we're right to have done so, it appears at least at this point. we'll see how nike performs after that strong session on friday we've raised the questions in terms of their business in china. we went into that in detail on friday, jim. you're right listen, these companies are doing quite well despite what

may be those so-called supply disruptions. >> i was shocked that nike could have -- nike u.s. was the strongest of the areas now, nike, you could have argued that there was weakness in china, there definitely was, but there was not a boycott, and that's what the shorts go the wrong. no boycott, carl i'm not saying that u.s./china isn't any good, no i am saying that u.s./china business so far not so bad kevin johnson from starbucks, they're buy china for china. it looks like that if you do a lot for the chinese, your company is going to stay strong. i like that. >> speaking of all of that, boeing is a story today. there's a couple of different stories. the 777 x long range, not likely to be certified by the faa until mid to late 2023 according to a letter from an faa official to boeing obtained by cnbc which details the technical issues that must be resolved before

that aircraft is approved. other stories say the max, it's getting sticky getting past china regulators although, at the same time, united apparently is working on an order that would make history. >> blowout order that shows you that things are wide open. i think we all never want to stop this scenario holy cow no breakthrough at all with china for boeing, none whatsoever david, no matter what, boeing is claiming right now and we listen to obviously the -- that all this that is involving the 777 was well-known what i always find, david, that's interesting is twhen i follow boeing really really close and what was well-known is not known by me. so maybe it's well-known by the ceo? who is it well-known by if it's not well-known maybe phil, maybe not. i mean, it's a close-knit people, right? close-knit group where it's well-known >> well, jim, as somebody who follows you closely, given i

typically am actually physically close to you as well, you've changed your tune on boeing lately, and you seem to be -- and i don't want to put words in your mouth, so i'll let you speak after this, but you do seem to be concerned about execution at the company, and i've heard you be critical of management in a way that i hadn't until very recently >> that's very true. greg smith, i think he was a very operational cfo waiting for calhoun to be able to say look, we've had some problems with unions, had some problems with something. do you continually miss? i know they can say hey, the faa doesn't like us because of the max. the faa wasn't like a touchy-feely organization. if the plane is ready, it's ready. i think anyone who doesn't think that has got their eyes closed f gary kelly did say momentarily issues weren't perfect there what bothers me is the lack of recognition by senior -- by ceo

saying listen, we've got a lot of problems. i want to hear we had a lot of problems, and we are going to get out of chicago, and we are going to go to the factory floor. i'm going to go to the factory floor until this is ready. i'm not seeing that. maybe he is, but i am not seeing the kind of crisis management that i would be used to. so when i see 777 have a problem but the time line is the same, i want to know why they didn't tell us, look, why do i have to learn from the faa why don't i learn from the company that, look, we've got some issues. and the answer is blindside, blindside, blindside, i'm tired of being blindsided. >> it sounds like it might be more in the coms area but also exec execution, right >> i would love to be able to hear, guys, here's where we are in all of our programs we have real problems in this program, this program, and this program, but we're going to fix it i think that's what a great american company does. >> we will watch boeing.

when we come back, some gene editing news sparking a big rally in bio tech names. we've got some details on that a lot of interesting calls today, microsoft, shopify, tesla, amc is a story on this box office weekend, and another suspension of gamestop out of baird as they say -- >> oh, i love that i thought that was going to be my stock trade for heaven's sake. >> throwing up their hands again. more "squawk on the street" on the new york stock exchange straight ahead personalized educ. oh. their award-winning content is tailored to fit your investing goals and interests. and it learns with you, so as you become smarter, so do its recommendations. so it's like my streaming service. well except now you're binge learning. see how you can become a smarter investor with a personalized education from td ameritrade. visit tdameritrade.com/learn ♪ i'm dad's greatest sandcastle - and greatest memory! visit tdameritrade.com/learn but even i'm not as memorable as eating

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we've got some news this morning on the biotechnology front. you're taking a look at shares of biojen. the house oversight committee announcing an investigation into an improvement and pricing of biogen's alzheimer's drug. secondly we've got a positive story. shares of intel ya therapeutics, they are soaring up 57%. this on news from the company and its partner regeneron, they've announced positive results in a phase 1, still phase 1 but a study of crispr based gene editing, a treatment for a genetic nerve disorder regeneron not quite as much. it's phase one, but it's a new -- it's the first therapeutic use for gene editing for crispr, and certainly vie ed as a potentially positive development. >> look, this is great news. this isn't technology.

when we first realized that moderna had an rna technology that was incredible. i think it's phase one and they're talking about it, shows there's something very early these are cathie wood stock. this is her. crispr, it b's obvious this is something that's going to work there is no doubt that regeneron's involved, but they don't want to take any credit for what's going on here carl, this could be the beginning of a whole -- this is a very rare disease, but you know, gene editing is the secret for the next generation. >> have you read isaacson's book code breaker >> no, no, it's good isn't it? >> all about the personalities, as he does delving into the lives of people making this new chapter of american medicine, global medicine. >> you don't win the nobel prize for doing nothing. that's one of the things i've learned. i'm early on that. i not unlike david when you kacald

me out on president trump about to win the nobel prize for making the relations between north korea, south korea stabilize. i was early on that too. >> yeah, you were, early and wrong, which is you know, not necessarily something -- that doesn't happen with you. you know, jim -- you do. you take a shot. you're never shy from taking a shot you may be dead wrong, but you took a shot. >> that was a ben simmons shot. >> you miss 100% of the shots you don't take. >> ben simmons and i have the same record from the free throw line when it came to that particular analysis. >> chris paul from the free throw line, that was a thing of beauty this weekend, right 90 plus percent. >> and scott wattner's team coming through david, you know these hedge funds that own teams, i mean, how do you do that >> yes, i'm aware of the ownership of milwaukee they're doing pretty well, and

then ballmer's got the clippers and it's going okay. not necessarily for them. >> what do we think about the hedge funds that don't own pro teams, are they losers >> you hold your head down in shame. you hold your head in shame, yeah >> the panthers, i think he knows a couple of players. he knows the names >> yes i think mr. temper same with kraft, jones, you know >> yeah, yeah, as a mets fan i'm certainly very happy with the ownership of mr. cohen before we go, let's get to the other part of what we mentioned there, which is bio general, jim. this prospect of the u.s. government through medicare having to pay who knows how much money to cover $56,000 a year in treatment, i mean, you've got now some democrats taking a look at the fda and the decision-making that went on there to approve the drug, but this could be very interesting as it moves forward, and perhaps an unwillingness on the part of some insurers to step up here as

well as the u.s. government? >> david, i deal with a number of the health insurers, they were so quick to point out that this ain't going to happen that they're not paying this, and that it's outrageous, particularly because there's not a lot of proof that it works so i think they're on to something. i think this is all a bit of a pie in the sky, carl, as much as we all want to take this the only -- there's never been a long-range study, which is what you need, and they're not standing for it. >> we had the news about the house committees, and then today rbc goes 400 to 354, right so there's a little skepticism creeping in. >> i think the skepticism is right. i think eli lilly, the stock is too high it's good to take profits on that one because that's also -- that's a me too drug, they do the same thing i just have to tell you when you see those price tags, i think that's a thing of the past i think there's going to be a

lot of pushback. i think that's something congress is united on, very rare. >> we've been saying that for a long time. these prices just bankrupt the system i mean, everybody, i hear the way that they are describing this drug, everybody in america would take it. everyone in america, we can't. we can't afford it the country can't afford it. >> we're going to watch that obviously, pharma a big story. also on the covid front too with new news about whether or not we need a booster in the fall we'll get to that. we'll get cramer's mad bash, the opening be olln this monday morning on this first half of the year don't go away. with a hybrid, you don't have to choose. that's why insurers are going hybrid with ibm. with watson on a hybrid cloud they can use ai to help predict client needs and get the data they need to quickly design coverage for each one. businesses that want personalization and speed are going with a smarter hybrid cloud using the technology and expertise of ibm.

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six and a half minutes

before we get started with trading this week. let's get to our first mad dash as we count you down to that opening bell tesla has had a pretty good move, hasn't it? >> yes, it has wedbush says this china situation with the recall moment of truth, david, that's the term they used. 285,000 cars, safety on auto pilot. by the way, tony sag negi comes out and says the tesla owners, still fervent supporters but starting to think that, you know what it's no longer rabid no longer rabid. so david, the moment of truth in china, i personally think this is not the moment of truth i think people like tesla, but i just want to say that if tesla survives the moment of truth call from wedbush, then it's to the moon, yolo >> really? to the moon, all right >> yeah. >> still down on the year as you point out, a cathie woods stock along with some of those others

that you mentioned in terms of gene editing still down, as i said, a big rebound from its recent lows, jim. >> yes, and i do think it's largely regarded as the leader of highest growth, and it has a lot of followers david as you've correctly pointed out over and over again, this group suddenly the high growth stocks, since the beginning of may have been on fire we don't talk about them enough. a lot of them including, david, a lot of the spacs have made major comebacks based on nothing. >> that's a good point we're going to be watching those names and a lot of others because we've got an opening bell, jim, coming up right after this

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virgin galactic shares building on friday's 39% game. u.s. authorities allowing the companies to start carrying passengers to the edge of space. today, jim, it's bernstein

they say the market cap is too high unless the business goes bananas in the 2030s, but they also say it's a risky short. >> one of the things that's happened is there's still a lot of traditionalists who want to relay -- david's going to love this what is he, he's on vacation somewhere, the fundamentals have been completely divorced from the companies because the companies are kind of like, david, the companies are like mon monopoly you know, virgin galactic has gone from being connecticut, pennsylvania, the railroad, what do you think i mean, you know what i mean it's just -- it doesn't have anything to do with the business, and it just has to do with the trading card, am i right, or do you get a different perspective up there wherever you are? >> they are at least -- wherever i am, yeah, don't you worry. i'll be back soon enough in person right next to you jim, come on, i mean, you know, they are going to be sending people into space. they got faa approval to do so you want to talk about the

fundamentals of the business, the stock price, sure, we can, and see what the price and how many people have signed up there can be a logical conversation that would explore it right now it's hey, they've got to approve it. they're going to do it >> but it is not -- it's not like united airlines i mean, i think it's limited service, david right? i mean, it's not going to fly out of newark every ten seconds or anything, is it is that the plan >> not that i know of, no, not yet. not yet. >> but then again when beach body's ringing the bell, anything can happen. >> that is beach body at the big board celebrating an ipo a bunch of moves on the russell reconstitution from friday, jim. what should viewers know about that rebalancing, reconstitution >> a lot of the meme stocks got more buy, and what i thought was

interesting was it didn't hurt the market the week before the rebalancing did hurt the market. this one didn't. there must be so much money coming into this market. this market is deluge, carl, with money i used to talk about with david, the transfer of money that would come in on monday. i think it's back. people want to be in stocks. people don't want to be in cds they'll buy amc, they had a lot of people come this weekend. they had a big crowd. >> they put out a press release a couple of moments ago, david 2 million people at locations in the united states between thursday and sunday, and we know that f-9, our parent company's new sequel of the fast and furious franchise 70 million box office, that's the biggest debut since covid began. >> yeah, that's a big test right there, a lot of people have been focused on f9 given the strength of the franchise for so many years and how it would do, sort of setting new bar here post-pandemic s and it did very well as you pointed out.

we talked a lot about amc's ability to sell stock, jim, given the incredible rise in those shares i don't know if you guys saw it, carnival cruise just hits the wires. they're also selling another $500 million worth of stock from time to time through at the market equity offerings, which is of course something we've seen we've talked so often, jim, about the ability of companies, perhaps that we thought were in somewhat dire straits to raise not just debt but surprisingly so equity in the capital markets throughout these very difficult -- this very difficult period that they went through. >> david, don't you find that it's interesting that no one talks about dilution i mean, remember when you offer stock, there is dilution, unless maybe you offer stock and amc can offer stock and go buy back bonds that are selling at a fraction of par, but david, in general, i used to think it's great when you sell stock in order to be able to stay in business, but if you ever have

earnings, the earnings are really kind of knocked down considerably, david. i mean, but no one ever talks about that. >> no, few people talk about dilution for some reason or at least maybe there's a lack of understanding amongst system of the shareholder base as to exactly what it means. >> are you saying -- david, david, i need to know, are you saying that perhaps the wall street bets people, are you saying they may not understand the concept of dilution? are you saying they're not studying with buffett? >> i think there's a great diversity of insight on that community. and i'm sure there are people who are well aware of the dilution but feel like the ability to raise the money is going to be overall a positive for these companies and then perhaps, jim, there are people who are not quite as familiar with the term and/or the idea of shares and earnings and how that actually works on a per share basis, yes

>> does raise a good point, diversity of understanding something he is such an ambassador of. are you at like the u.n. or the white house, david you're some -- you're a diplomat are you in the -- >> this house is very bhwhite, yeah >> i'm in a secret location, jim, dealing with some yard issues, yeah, so you know, what can i say? [ laughter ] >>st that's the hybrid model t everybody's living it should be no different on television >> exactly that's right you know, you got some things to take care of >> she can work at home, right what was it ubs -- >> probably not the last time you're going to see me here, guys. >> did you get into your tractor? are you mowing the lawn? >> i may try it could be the first and last time that you actually see me do that, jim. >> speaking of hybrid, you know, we talk about -- we talk about it a lot, guys what was it ubs is going to let, what, two-thirds of employees

adopt permanent hybrid work? i thought that was interesting, particularly in light of -- in financial services as we discussed many times, at least some of the well-known names such as goldman sachs, morgan stanley, jpmorgan have a different view. >> right. >> but this is -- i continue to believe this is an incredibly important business story as so many management teams try to figure out what to do post-pandemic, how many days people should be coming in or not coming in. they all say people have been incredibly productive being at home, okay, but there are other things that i think are harder to measure, jim, and carl. it will be interesting to see over time the success of organizations that go with the hybrid model versus perhaps ones that are a bit more traditional at least in their thoughts about people in the office >> right, and we're going to see some return to capital soon, i think wells is going to be able to buy back as much as 13% david, is it possible, some

people feel like this is a vacation when they're away do you think it's possible at credit suisse they're having an intellectual vacation? >> credit suisse we're back to not -- i was talking about ubs, so this is the other name -- >> come on, that was one of the funniest things i've ever said if you were here, you'd be on the floor laughing. >> that was really good. that was really good you know, credit suisse has some real issues, jim i think it's fair to say that. >> the reason i gave you that is i wanted you to talk about -- >> i wanted you to bring up the archegos -- because of that stock's price that we're looking at right now. >> and jim's referring to this interview that the u bs chief gave to i think a swiss newspaper, which he said he thought archegos was a, quote, unique event >> yes >> well, it was unique i've never seen anything quite like it. none of us really have it's funny, we still don't talk about it quite enough. the losses alone at ubs ex

exceeding more than 5 billion, but across wall street over 10 billion. it's still hard to imagine, as we sat there every day, of course, guys, talking about viacom and discovery and a couple of other stocks that we were less aware of and the lack of transparency. it's on the s.e.c.'s list, got to be another thing we've got to potentially deal with, the lack of transparency, the squawk market and the fact that nobody had any idea that this one guy, this family office owned, what, 25% of viacom, 25% of discovery. the numbers were incredible. the losses were incredible for credit suisse, and pointed to a lack of risk management there, and they've suffered as a result in part because their best performers who can leave are at least considering doing so >> right now viacom data continues to speak up on heavy volume, it's up again another $0.73. we don't really know where the stock should have been because of what happened, but it does -- it has definitely found a floor here, and what's bob backus up

to i have to be impressed with some of the things he's doing are they going to give him free rein to do more, or are people saying you know what this is the time to sell. >> i don't know the answer to whether it's the time to sell or not, jim i think listen, they're like so many of these companies focused to a large extent on their direct to consumer platform, paramount plus and making certain decisions about content and waiting, frankly, for the back end of this year or even early next year to introduce a lot more content given the delays that covid brought in terms of the ability to produce. but that's where the focus is right now i think for viacom we can talk all we want about potential consolidation. last week that journal referenced the comcast, but really as far as i can tell at this point, they're much more focused on just trying to execute against that vision in terms of directing consumer. get those numbers up as you well know, jim, in particular you focus on disney of late, that is where so many investors in this sector are

focused in terms of at least trying to determine who is going to succeed or not for the future >> meanwhile, record high as you can see on the s&p, record high nas. and jim, invideonvidia is a lite more than $100. >> nvidia, there was some press over the weekend they've gotten support of marvel technology, broadcom and media tech to be able to buy arm this is important because, david, you know this is a real breaking of the ranks with companies that were opposed to this deal. china objections still important there, david >> say -- wait, say that again, jim, sorry, i lost you for a second. >> marvel broadcom, and media tech are now saying, you know what, we like this deal. we have no problems with this deal, but there's still china to contend with you know if nvidia gets this, it

could be game, set, match, when it comes to even cell phones what are you hearing about possible chinese objection >> you know, jim, there is still a big question there's still a big question, jim, in terms of their ability -- sorry, guys, let me just hit the old working from home thing the ability of them to get approval from sammer, remember analog devices maxim, they're still waiting on that, that was quite some time ago. >> that's so not strategic nvidia seems to be -- i don't want to say alone, because obviously they've got some support now amongst their customers as well. there are many people who continue to believe it will be a very difficult road for them in china, and still in the uk where we know the review has not been completed as of yet, jim, and i know you're following it closely. >> and i'm backing jensen, you know that. >> i would certainly say in terms of speaking to people who

follow these things closely, there are still a lot of doubts they will be able to get to the finish line. we'll have to wait and see. >> i'm not betting against jensen, he's been too right, carl it was interesting to see these companies break ranks because these are a nice variety of companies that are breaking. i had marvel, you had marvel and tech chat, and you know they're competitive guys by the way, that guy is like a quadrathalon i swear to god, he could kill me with his two fingers. >> ian strauss, you'd have no chance. >> strauss does that by eating a lot of ostrich meat. but marvel an all time high here i just think these are very important. they could be the first dominos of companies that favor this deal i am with jensen wong. i think nvidia goes to 900, and by the way, nvidia, the dog, thank you for all the well wishes he has very good -- he's trained, he's 13 weeks and has the proclivity to know what to

do you know what i mean. >> keep those pictures coming, jim, we love seeing his pros progress. >> i will. energy's down almost a buck, chevron dragging down the dow. the sector's weak, even though these air strikes last night. >> i was surprised oil's been so hot, i don't want to bet against it. i thought that, you know, there is an opec meeting i know that there is a level where the saudis don't want oil to go to now, oil is getting harder and harder to drill in this country, harder and harder to have pipe, but the saudis don't want to see the recount up it's creeping up david, the saudis know that there is a level where we open the spigot in the permian, so there is a level where the saudis don't have any interest and we're closing on 2018 highs. what are you hearing because we know that if america comes back into play, well, i mean, you have enough money here to be able to both return capital to shareholders and

drill. that's a nightmare for the saudis >> i mean, listen, you know, what i'm hearing, it's more what you're hearing where are we in the permian in terms of where our highs were and where we are right now. >> we're down 1.9 million barrels. 1.9 million barrels from our height that is strictly because these companies have decided to return capital. they have -- carl, i remember the late aubrey mcclen non he always said oil companies don't know how to do anything other than drill there are other companies if they recognize they're putting out too much products they stop, but not oil people and for the first time oil companies have religion. they've been holding back. >> that's interesting, there's a couple of stories on the wire today about shale companies not getting sloppy, rights in the way that oil and i guess maybe hotels have been. >> hotels too. >> right they know to build hotels and

they know to drill, drill, drill, and i think the discipline that the oil companies are showing has allowed for this price to go up. i do think that pioneer has been the leader in this they've been acquiring with stock, but when you deal with some of these companies, deal with scott sheffield, he's the dean now, the stock i think is very cheap i would buy it at 160. i've been against the oil companies, but they've all kind of discovered the environment. >> although looking at those hotel prices a moement ago, some of this might be nervousness about the variant, in europe especially. >> i think so. we don't know -- look, i feel, i feel that, i have moderna. i feel like that maybe i've got a couple of years going here before i need something. >> there's a story in the "times" this morning that some of these studies are now suggesting that the protection from the vaccine could last for years, and that a booster in the fall is by no means assured. >> yeah, which would be great

news, at least for moderna and pfizer, right? it's those two, of course, that have been the key. and yet at the same time, we've got the world health organization, jim, recommending that even with a vaccine that people wear masks because of the delta variant. it becomes, again, very confusing to sort of judge the level of caution that is being shared by some of the larger, you know, advisory bodies on health issues in the world and/or in this country as well given what we've gotten from the cdc over this last year. >> there is confusion. one of the things that dr. gottlieb's been saying is, look, we're okay i feel very protected by this moderna situation. maybe it's because of where we live i have not -- other than when i went to the middle of pennsylvania, i've not met anyone who's proud of not being vaccinated >> i can't imagine anybody who would have any regrets. >> yeah. >> any regrets we're all in here mask free on

this floor today. >> right >> and i would argue probably just about everybody who's in this building would be vaccinated. >> and when you go to a restaurant now it's pretty much business as normal people are shaking hands dr. gottlieb did not shake hands before the pandemic. there's a man with some surety about how germs are passed when you go out here, the big issue is can you get a table you need more pull -- david, you need pull to get a table in chipotle. >> things are all out, man things are all out there's no doubt about that. you're right. >> so on these new highs, dow as we said zgetting dragged down b travel and energy. good morning, bob. >> happy monday, carl, good to see you, everybody last week of the first half, a new high on the s&p, up 2% this month. not a lot of new highs nvidia's one of the few ones you get this when tech leads for the month tech's leading,

you get these stealthy rallies market cap weighted s&p moves forward more than the equal weighted s&p there you see energy down. energy stocks have had a great run this month there you see industrials and banks, there you see the cyclical sectors tech has been the leader, come back, this has been the big comeback month, june for tech stocks energy's leading but it's on the 2.5% of the s&p 500. it's not big enough to actually move the s&p around. tech is, and you see the cyclical groups, the industrials and materials on top of banks all notably lower. there's that rotation from out of value and into the growth sectors. under the market we've got that tremendous rotation. we keep talking about that thematic tech also making a come back in addition to big cap technology, cloud computing, cathie woods arc innovation. all of the arc funds up notably. fin tech, lithium and battery to

the up side. here's that rotation these all got clobbered notably in february and march and large parts of april, all now back where are we right now the global growth story is improving. we're sort of relaxed on inflation. peak everything remains the primary mo teef for the market it's been a little sideways other than last week pe still pricey. remember, folks, at 20 times, that's 10 to 12% earnings growth the historic average is around 6% so it's going to be another great year expectations at least, for 2022, it's going to be another great year. there are risks. the big risk to the market is that pricing multiple right now. there's two things here that can affect that multiple number one, the fed could be wrong on inflation we could have a major problem. that would be a big issue. the multiple would drop on that, and we should have a sharper drop in growth, particularly on

earnings growth. so far that's not happening, and that's why we're doing so well if you look at the early reporters, the companies that report early, the nikes, adobe, kroger, lennar, oracle, terrific earnings, all of them above expectation across the board the only disappointment has been nike, and nike was a disappointment because it was in line and the whisper numbers, they're back, carl had been much higher than expected for fedex so other than fedex, everything the early reporters have been outstanding. and remember something, earnings are still rising even last week if you put them up, you can see the earnings rising for the third quarter and for the fourth quarter, carl, and as long as those numbers keep holding up or even raising the arket's going to hold up carl, back to you. >> bob, thanks, we'll see you in a bit, bob pisani. we'll take a break here, look at how treasuries are doing this morning. a lot of macros headed our way with the pmis, jobs friday, yields are in the red, we got that brief record high on the

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. >> one of my favorite analysts, he puts out a piece saying ok u lies, needle movers. that's one of the reasons that facebook is moving this is vetincredible nothing is a flow away when it comes to facebook. another reason to buy. keep that mind that stock really breaking out. >> wow not quite an all-time high but after friday, awfully close. >> it's getting bigger in market cap. i am excited about tonight's guest etsy, they bought the brazilian

etsy, the leader right now in the market today one of the things i really like about etsy is this is really the anti-mall, anti-amazon to some degree those who sold on to know or those who bought on it -- we have bought on it for our bar and restaurant, there is follow through. we bought our beer caps at longshoreman there bought our april runs, made them in britain it's a great marketplace people should go there now brazil 1.8 million people in brazil tens of thousands of people who make crafts. >> well, definitely can't wait to see that. >> see you at 6:00 "mad money." >> maybe dave will get that yard work done. >> dow's down 113. s&p in the green we might see chop in the early going. we will be back in a moment.

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an all-time high on the s&p and nasdaq travel-related names, financials and energy weighing down the dow. >> we are 30 minutes into the trading session. the three big movers we are watching starting with nvidia, $40 billion take over from some of the u.k. chipmakers major customers. that stock up almost up 50%. virgin galactic building on friday's 39% gain after the company got that go ahead from u.s. authorities to start carrying paying passengers to space. actually virgin galactic pulled back, 3% and tesla, recalling 300,000 cars to implement a software update the owners will not have to return the vehicles in order to receive the update tesla up another 2% this morning. let's turn to the broader markets. we close out the first half of the year, nasdaq hitting a record intraday high, the s&p 500 back in the green, and just

kind of nip and tuck here in a volatile morning joining us, president -- and chief equity strategist. good morning barry, i love to start with you. you are looking for something other than what we have been seeing recently, i guess, to some degree. you see a defensive move in the markets in general, maybe a waning of this recovery train. almost a return to some of that disinflationary flavor we got used to in prior years lay that out for us. >> we look at the short-term just out to six months the median term and long-term in our reports. this is a short-term call. we have had a big move since the covid problems of 2020 in cyclicals relative to defensives and value relative to growth but i am looking for a miniature defla deflationary shock, a stronger dollar, 5% pop in the dollar the rolling over of the pmi

manufacturing, which is that good old standby indicator that we use for so many things. as that happens it pushes you more into the defensives like health care, consumer staples, some utilities and telephones. it doesn't really argue for growth because if we get the dollar shock, declining global liquidity, then the goldman sachs financial conditions index tightens, the market will fall about three turns and you get up to 10% correction between now and the end of october. >> 10% correction would be in the context of this mini deflationary shock now, would earnings estimates continue to raise higher that has made the market look cheaper now than the beginning of the year even though the s&p is up 14%. >> yeah, we did a note this morning. we showed our year to year growth estimates this year into 2022 historically, believe it or not, the pmi manufacturing index

alliance with the year to year growth of s&p 500 earnings our estimates, which are below the street, we are at, i think, 37, 38% growth in year the street is in the low 50s our estimates look more realistic based on the pmi forecast and the pmi forecast is of course based on china's tightening with the lag, china is tightening, and the stronger dollar affecting us negatively >> ed, how do you put this together against all of that, is the idea that a strong uptrend in the first half tends to continue in the second how would you play things through the summer here? >> yeah, barry made some very good points. i am not, however, in the correction camp. i think there is way too much liquidity up there and m2 is up about $5 trillion compared to where it was early last year before the pandemic got started. there is an enormous amount of liquidity which reflects the fact that we have had a

tremendous fiscal and monetary stimulus not all of that has actually been spent either in the economy or in the financial markets. so look, we had a correction in the nasdaq earlier this year when bond yields got up to 1.7%. then as the bond yields come back to 1.5%, we have had another rotation back into growth overall, i don't see a correction i think it's going to continue to be a very broad-based market. i think that it's going higher i have 4,800 on the s&p 500 by the middle of next year. i don't want to talk about my forecast for this year because we are already there i thought we would get to 4,300 by the of the year and we are just about there this market keeps racing ahead of even the bullish scenarios. >> some of the competing scenarios, ed, point out the slowdown in the growth of money supply i wonder to what degree do you think that will impact the overall indices in the second

half >> not much. i mean, it's true that the year over-year% change is slowing down, but there is $5 trillion more in the money supply in m2 than the beginning of last year. and when you look at it compared to gdp, a lot of people look at nominal gdp divided by m2 and they call it velocity. i don't really like that variable never made much sense to me. but i have no problems with the m2 over nominal gdp. it's 90%, all-time record high so we have almost a year's worth of liquidity in m2 they can't all possibly be precautionary. it's got to be a lot of liquidity that has the potential to come back and drive economic growth and drive financial assets higher. >> barry, you mentioned that you would expect the sort of financial conditions indexes, which have been ultra loose for a long period of time, perhaps to tighten here if we get this

scenario playing out that you think. what is going to be the main driver how would it manifest? is it going to be credit spreads? is it going to be the fed? is it going to be equity volatility >> you overlay the year to-year change in the index against the broad dollar index, they line up very closely and we are looking for a five plus percent rally in the dollar i think china will let the currency slip a little bit we are coming up with 6.7, 6.75 to the dollar. it suits their needs in many levels but one of the things that will happen is this, the growth rate of this m2 liquidity that you mentioned peaked on the 22nd of march in dollar terms globally $100 trillion in global m2 peaked at 22% that month it's now below 10% growth and falling fast every time that happened in the last dozen years since the financial crisis we had a flattening out of the market

so the seasonality asserting itself and i think may to october could be choppy for investors. >> that would mean july-october, we are the end of june thanks, very much. >> thank you. well, we are watching some big moves in the biotech space this morning with names such as intel yeah, surging 43%, regeneron. meg is here to tell us why meg. >> regeneral i don't know and inia use crisper gene editing. they had a milestone over the the weekend in using this technology, this gene editing technology that wron the noche buena prize last year to reduce a key protein that causes attr, a rare disease it was the first time crisper was delivered systemically in the body through an i.v.

infusion i talked with one of the co-developers of crisper, who won the nobel prize last year, at the evolve summit about these challenges of delivery thee puts it in good context with why today it's such a big deal. >> tit's focused primarily on x vevo therapy, which means being able to manipulate cells in the laboratory and then reintroduce them into a patient. this is where sickle cell disease is a great target, actually, is blood stem cells can be harvested, edited and reinfu reinfused in patients. >> she was talking about other applications of crisper like sickle cell where you have to take the cells out of the body, edit them and give them back other applications, for example, inject the crisper in tissue like the eye this is the first time it's been given as an iv infusion systemically so you are seeing all of these gene editing tox up big on this

because it's a proofpoint for the technology, guys one stock you are seeing down on the news is alnylum. they have an approved drug in the space and people are weighing potential coming competition, down number 9% as intellia up 40%. back to you. >> meg, clearly a very important milestone for them in terms of a point of proof here. but at the same time it's phase one, right there is quite some time, i would imagine, until they are actually into phase 3 and can expect to be in front. fda? >> absolutely. the most remarkable -- not the most remarkable thing, one of them about thus, this is in six patients that 87% reduction was seen in three patients who got the highest dose of in crisper gene editing therapy. this is small. we will see more data from phase one before we see bigger trial

results. and they have a ways to go until they get to the market potentially. a huge first step in proving that it can be done. >> yeah. as we take a look at the arc fund that focuses on some of those names as well. meg, thank you and tomorrow, by the way, it's going to be a first on cnbc interview with the ceo of eli lilly, dave ricks. that's tomorrow at 10:00 a.m. eastern. as we head to a quick break, a look at our roadmap for the rest of the hour the faa telling boeing its 777x aircraft isn't likely to be certified for at least two years. british airlines fighting back against covid travel restrictions the ceo of easy jet is joining us and the fed's crypto warning with an official calling one cryptocurrency a challenge to financial abitstily. big show ahead on "squawk on the street." don't go away.

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turning to boeing, the company's 777x long range aircraft isn't likely to be certified until late mid 2023 according to an faa official it details technical issues that must be resolved before the aircraft is approved joining us now to talk about this, sheila, good morning put it in context for us we talk with multi-year order books and backlogs and cash flow when it comes to boeing. how significant is this move

>> not so significant. boeing basically announced the delay from 2021 to 2023 in their to k this isn't surprising this is going to take long if the 777x is certified in 2023, it would be ten years from launch date to certification entry into service, which would be the longest the average is 8.5 years the max adds to the delays and the scrutiny that the faa will look to. the benefit is the body-body market is depressed. international travel is down # 07% last month so they are benefiting from the fact that the market hasn't picked up internationally yet. it's not like the 777 order book is very robust. >> we see boeing pulling back a little bit, 3% it's, obviously, a pretty headline sensitive stock given the fact that we are waiting for the full recovery. what are the other key swing factors for boeing

i know you have taken a look at china's posture on the max and what are we waiting for to solidify people's expectations that things are back to going right for boeing >> i don't even know where i start. there are so many things we are waiting on the max is finally getting back together we are averaging 10 to 14 a month. that should be closer to 22, 30 by the end of next year. there is that catalyst the 787 is just reentering deliveries the 777x is you know, fractured by faa delays. we are waiting on a number of items. you mentioned china. china is very important to the max and the 787. it comprises 20% of the historical deliveries, 20% of the order book we garner, you know, worth $1 billion of revenue to boeing annually once china certifies the aircraft, it's $24 per share that we assume boeing will benefit. we estimate half is in the

stock. so $12 per share for boeing once china certifies the max. we have over 170 authorities for the max already out of 195 entities globally. >> everybody tracking the daily ts a-numbers in terms of air traffic and trying to feed that through to some idea of what that means either longer term or near term on service side or demand for new aircraft? does it matter we are still below 2019 levels, naturally. >> i think we have several catalysts. domestic travel in china is back to 2019 levels in the u.s. we are about 20% below that so we are going to see domestic come back. international, as i mentioned, down 70% so there are several items to look forward to in terms of just the process. you have seen big orders come out of the u.s. airlines, legacy carriers, as well as low-cost

carriers we are starting to see orders come back, particularly on the narrow-body side. >> on the wide-body, we have seen some bullish notes from analysts trying to get ahead of what they believe will be a stairstep function higher in international and then on consequential demand for wide pose are you going for that >> we cover the airlines, too. we upgraded dell on the potential recovery we think europe will come back first and delta is the most exposed to that with half of its business tat international a quarter of its sales to transatlantic to european travel we think that will come back faster than asia however, we are seeing stops and stops. the delta variant is peaking in the u.k. the case was 17,000 last time i checked. that's creeping up and something to keep an eye on. i am not bullish on wide-body

orders we don't forecast, when you look at wide bodies, the 787 or 8350 from airbus, we are forecasting a five per month production rate to 2025 compared to where they were pre-covid at 10 to 14 a month. we are forecasting that business as cut in half and we don't foresee that am coming back for the next five years. >>thanks a lot you went through a lot with us appreciate it. >> thank you very much. speaking of all of this, the covid travel restrictions in the u.k. have impacted the airlines there quite bait the u.k.'s travel industry held a day of action to put pressure on the government to reopen the sector joining us this morning in a cnbc exclusive is i don't yohan lundgren, the ceo of easyjet we know how much pressure the prime minister is under to open restrictions in mid-july

merkel had cautionary tone last week todayis hong kong barring travelers from the u.k. beginning july 1 what the status of european travel >> well, i think it's fair to say we never anticipated that there was going to be a straightforward recovery we always knew it was going to be bumps along the way clearly, with the successful rollout of the vaccination we believe much of european travel could be opening up in a safe way. we can see that there is a clear breakage between the link of the cases of infections and severe hospitalization cases, if you are double vaccinated. and with the u.k. now being at, you know, two-thirds, they have two jabs, we believe there could be a safe restart of travel in a much greater extent than we are proceeding today >> yeah, that was certainly johnson's comment earlier today. that is the cases may be bound a bit, but the hospitalizations

and deaths are nothing like what you saw prevaccine so where does that leave the industry in terms of their argument, and do you think the reopenings really happen in the next couple of weeks >> yes, i do think that they will now, i have said that, you know, i think that with the data, the evidence shows that you could open up this in a safe way there is no reason why you shouldn't see, for instance, in the u.k. more destinations added on the so-called green list, the low-risk countries, and also see that you should remove all of the restrictions from the green list and what the members say in europe, what they are doing in europe is allowing everybody who has a double -- had a double shot of the vaccination to travel without any restrictions at all we urge the u.k. government to do the same thing. it's not justified by any medical data or science that u.k. should isolate itself in the way it's doing here today. we welcome the fact that they did add on more, but it's too

little, too late and many more destinations should come on to that green list. >> last week here in the states we had our chamber of commerce in washington lean on the government to start opening restrictions, try to get international travel back in this country certainly for your new york city, it's a huge city for international tourism, trying to revive manhattan, for example. can i ask you what you think about transatlantic? is that going to be a second-half story? >> we don't operate in a transatlantic flight we are the second largest airline within europe. what we have been asking the government to do is to be transparent on the decision-making. what constitutes safe travel what are the number of cases of infections per 100,000, as an example that you would deem to be to live with? remember this not about approaching this from a zero covid perspective. this is about managing a risk,

not zero risk. when we have been calling out, and the day of action we said let's be transparent with the data on what is actually going to be needed in terms of those criteria to actually make the travel reopen in a safe way. the most in-depth analysis shows you could put much of europe on it that green list what matters is the rate of the vaccinations in the u.k. and the rate of infections elsewhere of course, variants of concerns. there is plenty of data to support that >> why isn't it happening? what is the reluctance on the part of those in the decision-making positions to actually move more quickly towards what you are describing given what we're seeing in the data >> you know, i don't know. i give you my honest answer on that that's why the whole of the industry is very confused and we are frustrated about this because it's not justified when you look at this from a medical

data scientific approach they are opening up. the u.k. economy domestically with a different lens than they are looking at this from an international travel point of view i don't want to speculate on the reasons for this but it's very good questions that's the reason why we ultimately called out this day of action to highlight this once again to the u.k. government and also to the public remember also here, that this is not only about the industry. there are millions of people who can't reunite with close family members that they have living on the continent that is an example. so if they can't reunite in a safe way in the u.k., why shouldn't they be allowed to do that in a safe way in europe when the data says it's safe to do so? >> finally, i wonder if you won't mind fielding a question on fuel. are labor costs or any kind of cost pressures that have been creeping up into the middle of the year here, is fuel starting to become a real worry or is

this just part of rising demand? >> well, unfortunately, it doesn't matter that much when you don't do any significant flying that's one answer to put it like that no listen, we have had hedges and positions in place to deal with the volatility that's in there but our first and foremost concern right now is that we want to be able to start operating again in a safe way. we believe that the data tells us we can do so. that's what we are urging the government to to that's our primary concern. >> makes sense we don't live in a zero risk world. the point is to manage the impact on the healthcare system both in europe and the states. johan, thanks so much. good to see you. >> thank you all right. as we head to a break, take a look at gamestop they are suspending coverage on the stock saying speculative trading by retail investors makes it hard to make, quote, reasonable recommendations that stock up 4.4% this morning,

218. we'll be right back. stay with us no longer need? now you can sell your policy, even a term policy, for an immediate cash payment. we thought we had planned carefully for our retirement. but we quickly realized that we needed a way to supplement our income. if you have one hundred thousand dollars or more of life insurance you may qualify to sell your policy. don't cancel or let your policy lapse without finding out what it's worth. visit conventrydirect.com to find out if you policy qualifies. or call the number on your screen. coventry direct, redefining insurance.

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for our "etf spotlight," a look at the utilities sector ticker xlu adding to its gains, up 16, 17% over the past 12 months it looks like big underperformer to the overall market, up over 40%. one name to watch, goldman adding nrg energy. increasing its price target to 57 from 46 stock is up about 4.#% already this morning we are going to take a quick break. stay with us the world's first fully autonomous vehicle is almost at the finish line what a ride! i invested in invesco qqq a fund that invests in the innovators of the nasdaq-100 like you become an agent of innovation with invesco qqq

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your cnbc news update. the death toll from the partial collapse of a florida condo building rising to nine over the weekend. search-and-rescue operations continue for 150 still missing efforts enter the fifth tay. airstrikes in iraq and syria yesterday. the attacks targeted iranian-back militia groups that the pentagon blames for drone attacks against u.s. troops. a pentagon spokesman says the efforts were designed to limit escalation and send a deterrent message. record high temperatures in california a 1,200 acre fire broke out along a highway after a car fire jumped to the hillside in oregon many restaurants and bars are closing due to a shortage of ice and air conditioners. and the supreme court has declined to hear a case about other schools must allow students to use bathrooms that match their gender identity. the decision now leaves in place a lower court ruling that a virginia school board acted unlawfully in preventing a r

transgender student from using a bathroom that corresponded with hissend eye identity you are up to date carl, back to you. welcome back to "squawk on the street." i'm carl quintanilla with mike santoli and david faber. about an hour into the trading session, get a check on the biggest leaders on the s&p a fair amount of tech, but specifically semiconductors. nvidia 792 a hundred bucks of targets of 900 we have gotten lately. laggards are going to be around financials, energy, and some travel related names royal caribbean. the cruise lines the concerns about the makan delrahim around the world. >> that seems to be muting the reopening enthusiasm yields definitely coming back off of their recent highs as well back under 1.5% on the ten-year treasury in terms of where we come into the week, up 14% on the s&p year to date. if you look at what that tends to mean for the second half, up

more than 12% on the s&p 500. three quarters of the time the rest of the year you are also up only one of those years did you really undo the first half increase so it seems strong markets stay strong if this year you are fighting just this massive gusher of corporate cash flow, credit markets amazingly good the issue, thi think, is this dynamic of rate of change. the reason that the reopening stocks pull back is we are past the peak that's the push/pull we are dealing with into the summer seasonal effects turn a little bit less friendly in about three weeks. >> three weeks >> mid-july. i mean, you can't be too precise. last week was supposed to be awful. we don't know how this works but it tells you that's one thing to keep in mind. also, the analogies from the prior times we have had 70% gains off a market low like after 2020 of march you always have some payback and we haven't

had it 2010 we had it 1983 you had it. maybe this is a different setup. >> let's ask morgan stanley's cio. good morning. >> good morning. >> i wonder what you make of mike's point about first half tailwinds. is there enough to the tank to get us through the rest of the year >> our perspective at morgan stanley is that we are going to have this 10 to 20% correction at some point between now and the end of the year. but at the same time we think that that would be a viable correction we are probably going to end up about where we are right now the question from where we sit is really leadership now, the market over the last three weeks, as to your point, you know, decided that the reopening trade or the pro cyclical trade is long in the tooth and folks want to get a little bit more defensive. they want, you know, to kind of

own, you know, long duration secular growth stocks that are very sensitive to the fact that, you know, the long end of the curve is seen, you know, rates come down. we ultimately believe that this is going to be a business cycle that runs a lot hotter, but shorter. and that heat is going to come in the form of economic growth and inflation, surprising on the upside and so we do see that more value oriented reopening cyclical trade coming back in to kind of help us exit the year. but we're not going to get there without a little bit of shakeout, and that shakeout is probably going to be catalyzed by a move back towards highs on the long end of the curve with the ten-year maybe getting back to that 175 level we saw back in march. >> right i know that your team has made a point about cyclicals in an

environment where you have decelerating earnings power, decelerating gdp, decelerating inflation expectations how would you know when some of the deep cyclical names will be viable >> yeah. so, look, we want to be really careful. i don't know that we are owning the deep, deep cyclicals we certainly want to own the financials, industrials and energy names and a portion of what i would call the, you know, less sizly tech names that are really related to capital spending, and that's the piece of this that we think is going to continue to surprise on the upside on the consumer side, we think the housing-related ecosystem that surprises on the upside and so we would be owning cyclicals related to those themes. but ultimately when we look at this, yes, things on the margin are decelerating and we certainly respect quote/unquote the math and second derivatives,

but the reality is we are going from a, you know, second quarter gdp growth rate that is going to likely on a nominal basis be in double digits. so even if in the second half of the year we are putting up some quarters that are 6s and 7s, that's two to three times what, you know, average growth was last business cycle. so that's going to be plenty of growth, you know, for some of the more economically sensitive names to continue to power through and put up some earnings >> lisa, if we dig in a bit deeper on your expectation for a potential krekts of 10 to 20% the next six months, what is behind that? why do you expect that that may well occur >> so again our sense is that what is underestimated here is economic growth and inflation. and inflation expectations so we've seen the fed be very successful in the short term, you know, really pressing down

on rates as they've asserted that everything that we're seeing with regard to inflation and inflation expectations is transitory we just disagree we think that that sus stenens of inflation through the september/october timeframe as we get people back to work, as that back to work season comes with wage gains and higher rents, we do believe rates are going to come back up to that 175 level on the ten-year and that move kind of catalyzes some weakness in the indexes, which we know beoth the nasdaq and the s&p 500 are weighted pretty heavily in some of those expensive long-duration tech names that are very sensitive to that interest rate for their valuations. >> i wonder what it all means for the global picture in terms of market catch-up in overseas markets. i was looking today. the all-country world u.s.,

excluding the u.s., still trailing the u.s. and it seems like dined of the value trade in a different form would be to go overseas, but then you have issues with spotty growth in some areas of the world. >> we really respect everything that you are saying, and including international in your equity diversify itcation is absolutely key to our view of what a good strategy is going to be in the second half of the year certainly, you know, some of the regions, europe in particular, and then, you know, japan and parts of -- have trailed the pace of reopening that we have seen here in the united states many of those countries still trail in terms of their overall population vaccine progress. but we do think that they are going to get there and so as we think about maybe a more range-bound or u.s. market that may have to go through this correction with interest rates repricing, owning some of those

international stocks, particularly in europe, particularly in japan, and a well diversified basket in emerging markets we think is a very good strategy, particularly in an environment where diversification between stocks and bonds may not be effective, maybe we have to do some diversification by region. >> fabulous stuff, lisa. always great to check in with you. thanks so much. >> have a great holiday, guys. >> you, too. well, cryptocurrency tether is drawing attention from the fed. kate rooney has details for us she is back at cnbc's one market in san francisco kate >> hey, david. good to be here in one market. we heard mentions of cryptocurrencies from jerome powell and others at the federal reserve. i am told this is a first. a fed official publicly calling one out by name as a systemic

risk boston fed president eric rosengren mentioned tether friday, pegged to the price of the u.s. dollar known as a stablecoin he describedit as a potential dom i know in short-term credit markets. >> there is a financial stability concern that a future crisis could easily be triggered as these become more important sector of the financial market unless we start regulating them and making sure that there is actually a lot more stable stability to what it being market today the general public as a stablecoin. >> this digital kcurrency the third largest in the world it's mostly used by traders to get in and out of boyle and otherer cryptocurrencies opex changes. backhand by those who might want price stability, but also might not have a u.s. bank account it's not 100% backed by dollars in a bank account. that was part of the risk potential rosen gran talked

about. tether is mostly backed by dollar-like assets, short-term debt and according to jpmorgan the seventh largest holder of commercial paper in the world. carl, back to you. >> unbelievable. thank you. kate rooney back at one market we will hit a lot more on "tech check," including the u.k.'s financial regulator banning one of the world's largest crypto exchanges. it starts at the top of the hour meantime, dow's down 160 but s&p holding 4208 8.0.

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an effort to raise cash. more from beijing. eunice >> thanks, david despite the political tensions between the u.s. and china, new york retained its appeal among chinese companies looking to list later this week didi, the uber nemesis here in china, is going to be -- is set to raise about $4 billion in an ipo this wednesday. softbank backed grocer ding dong lists on the nyse and hotel operator atour is going to be debuting in new york this comes after 29 chinese companies raised about $8 billion in the first half of this year. new york's main draw, as you could imagine, is still the fact that it has a very deep pool of investors and here in china it's still a marketing tool with domestically, people like to say, look, i have a listing in new york, and i have arrived and then the accounting scrutiny

is still seen as tougher, but at the same time it's seen here now as targeted. so a bit of a more rational approach from what chinese companies thought they might be facing chinese companies aren't only feeling the pull of new york, but also a push from shanghai. shanghai and the chinese government has been promoting the exchanges there as a place for chinese companies to list. but at the same time a lot of chinese companies have been scared off by the recent crackdown on tech as well as private companies. in fact, in the first half of this year 87 chinese firms have canceled their shanghai ipo plans on the tech board, and this is after regulators said that they want to make sure that they tightened regulations and that they scrutinized what they described as potentially sick

companies. guys >> yeah, eunice, it's david. specific to didi, i think the books will close at 5:00 p.m. eastern today. i think it's wednesday we will actually see a trade but any thoughts there 62 plus billion dollars market value initially. any concerns for the company in the chinese market where it's so dominant >> well, the main concern that people have been talking about here is the regulation and the broader crackdown that there has been in technology so that's going to be a main challenge for the company. but it does, at the same time, have a very good relationship with the government. they have been in discussions with the authorities so a lot of that tech crackdown has already been telecast, you know, for any investors who are concerned about this broader regulatory environment

>> fascinating work, eunice, as usual. as we go to break, keep your eye on beyond meat today up 4% after announcing an on-demand grilling kit in partnership with doordash for the summer that price is going to take you back pretty much to late february dow's down 153 don't go anywhere. you put muscle over matter. and you make horsepower... a superpower. ♪ you packed a record 1.1 trillion transistors into this chip i invested in invesco qqq a fund that invests in the innovators of the nasdaq 100 like you become an agent of innovation with invesco qqq

welcome back to "squawk on the street." stocks are mixed to start off the week as technology leads along with the utilities sector. but energy is the big laggard, down around just about 3% so far today. every single constituent of the energy sector is down 2% with nov, occidental and ap down around 5% or more. chevron and exxon are under pressure as well the big drop in energy comes as we see oil prices slip after closing at their highest levels since 2018, just last friday there is more "squawk on the street" ahead. st wh ayitus

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senator bernie sanders calling to adjust salt caps, but high earners, well, they may not feel that much relief. robert frank explains. robert >> good morning, david bernie sanders included $120 billion in his budget for salt

relief, but a full repeal of salt would cost more than 3 times that the message is that a partial repeal is more likely. well, what kind of partial repeal democrats had been talking about raising the cap to $20,000 or maybe $25,000 from the current $10,000. now, though, the focus is shifting to an income cutoff of maybe $400,000 that would get rid of the cap for those making less than $400,000 a year, but keeping it entirely for those who make more than that. that would create a new kind of income clip, a new york taxpayer had $399,000 in taxable income and $45,000 in state and local taxes. they could deduct $45,000 at their tax rate, but if they earned $401,000, they would pay $12,000 a year more in taxes because they wouldn't get to deduct that salt now, income threshold would appease the democrats who say

salt repeal only benefits the wealthy, but does little to help the highest earners in high tax states who take most of the salt deductions and pay the largest share of taxes >> the congressman from new jersey was a guest on "squawk box" right after you had your report, talking about all those u-haul trucks, trying to track how many people are leaving the high tech states it is a real exodus. it is real based on the fact that, again, the tax rates in some of these other states are so much lower, particularly given the inability to deduct state and local income taxes >> yeah. i think for the wealthy you need a gulf stream index rather than a uhaul index because the billionaires aren't moving out by uhaul, but the data is not current, but we know you and i know anecdotally they are moving the question is would a partial repeal help that or would a full repeal help that given that

taxes are still high and you only can deduct a part of your income tax in the high tax states >> yeah. with enormous budgets, we should point out, new york and new york city robert, conversation for another day. appreciate it. thank you. >> thanks. all right, let's look at the markets as we wind down the hour here really got that seesaw effect under way again here we had the growth stocks up solidly. the nasdaq up close to 11% the reflation and reopening trades to the degree that they are still in effect are definitely on the downside today. people pricing out this idea of a very fast accelerating growth, and those treasury yields coming down as well market breadth is an issue people have been watching for a while today. today, almost twice as many stocks down than up on the new york stock exchange at the moment as the s&p 500, though, because of all the rotation can manage to stay pretty much at

the all time highs, been around the flat line all morning, 4428. that will do it for "squawk on the street." "techcheck" starts now. >> all the park rangers at alcatraz were one time guards. myself included. my name is john johnson. everyone here calls me vicki will you please follow me? >> i love vicki. he's great >> he's the best good monday morning. welcome to "techcheck. i'm carl quintanilla with jon fortt and deirdre bosa a lot more on the all time highs for the s&p as we come off the best week since february tech stocks, software setting new records today. we have that action.