should point out that all three of the major averages are, i think, less than half a percent or right around half a percent from their all-time highs. s&p would only need a gain of about 23 points to be sitting at a new closing high today 1.3% for the treasury. that does it for us today. we will see you back here on monday have a great weekend, everybody. >> have a great weekend, everybody. >> right now it's time for "squawk on the street. >> bye bye good friday morning, welcome to "squawk on the street." i'm scott wapner with jim cramer who is at the new york stock exchange this morning. carl and david have the morning off. jim, it's good to see you as always let's take a look at futures we're going to have a strong finish to this crazy week. right now the futures would be higher across the board. dow jones industrial average opening higher by about 170. nasdaq strong earnings from some tech companies we'll talk about that in a

moment s&p 500, man, not that far away from a new high. our road map this morning starts with the chip shortage intel's ceo saying it will get worse before it gets better warning that it could last into 2023 plus, watching social, snap shares surging ahead of the open twitter reporting its fastest revenue growth since 2014. there are also new covid concerns this morning, the cdc director calling the delta variant one of the most infectious respiratory viruses ever but jim, we'll begin with the market as becky was saying at the end of "squawk box," we're only 23 points away from another new high on the s&p. who'd have thought we'd be here given the way we started this week, jim. is that all forgotten now? >> we did think at the beginning of the week that the variants, that delta was going to take us all down thand then we get thes reports that indicate that's just not a factor. it is rather amazing that you could have something that seems

so dire on monday, that was the end of a three-day period by the way. we've had a bunch of just three-day selloffs and then we take off but i've got to tell you, i'm listening to these companies and with the exception of intel and boston beer, holy cow, almost all the calls have been delightful boston beer is one of the worst calls ever, or as bonnie herzog who's the unbelievable analyst at zbgoldman sachs, i truly dont know where to begin. >> that's ugly u i mean, you mentioned intel, gelsinger was talking about the chip shortage getting worse before it gets better, you had some price target cuts on intel this morning, which i saw your note that you passed around. you said it's a travesty were you talking about the quarter a traf psy or the fact that price targets got reduced >> >> no, no i just think that intel is

trying to -- pat gelsinger, nice fellow is trying to be -- i don't know, andy grove he's no -- i knew andy grove he's no andy grove when you listen to him, he acts as if the problems with the semiconductor companies are what intel has. when we hear lisa suneck speak, we're not going to hear that we've got a bit of shortage but they're going to deliver i think pat had a shortage in earnings, got the wrong product. the company was being poorly run. you can't turn that battleship around in one quarter. if you're going to decide that intel is the semiconductor company of old, i'm going to tell you you're very ill-advised. i didn't like the quarter. i didn't like the way the quarter was presented. i don't like the way that pat has assumed the mantle as semiconductor man in chief it's not right there are others who are doing better and they're more important. >> wow you know, john ford spoke with pat gelsinger.

let's listen to at least a soundbite of what he told our colleague jon fortt. >> overall, we think that's the case for the industry and for us, and we're working to build more product you know, first half to second half, we have more expense coming into the business particularly as we, you know, start bringing on more of our 10 nanometer, our 7 nanometer costs. so we have some unique one-time things which are just good news as we move into the next process technology nodes we expect asps to be fairly stable first half to second half, partially because of those supply constraints >> all right, that's pat gelsinger there, jim so you said wrong product, and you're going to see more of that interview. >> he's two years behind amd. >> if they have the wrong product, is he the right guy is he the right guy to turn it around >> the company was terrible when he took over, so look, i just think he has to own the fact that 7 nanometer, 10 nanometer's old. last quarter he said that the

problem was industry slowdown, but jensen huang and jensen is the leonardo da vinci of the group at nvidia and lisa su at amd, they didn't have a slowdown they had great stuff this is kind of like a retailer who says, listen, it rained the whole time that's why we had a bad quarter, and the other guy across the street said it's sunny as much as pat's trying to tell a good story, he doesn't have a good story people should be buying advanced micro because is taking share as she said she would when the stock was at 5 bucks, she's delivering, and so if you want to believe pat gelsinger that the industry's troubled, i think a few days from now you're going to find out it's not. >> you know, the flip side of this kind of conversation we're having, jim, is snap, which you call the best quarter of all of them last night, if not beyond

>> you know, it's speiegel, he used to be an egomaniac. now he's kind of humble. he was going hollywood when he started. now i think he's going to move the company to like peoria no offense to peoria, it's a great city, but i just thought this quarter was amaziing and people want to advertise on snap, everybody does it just shows you that if you want to reach people of a certain age who are trying to figure out whether colgate or crest, then you go to snap and the advertisers love it. the ar -- i mean, these things that you and i might think are silly, scott, your kids might right now be using snap to make themselves have bunny ears and glasses. >> yeah, they literally might. look at that igain, 17%. you know what, jim, it's so funny. this has been what i think you

could characterize as an under the radar move in the shares because so much conversation has been around the facebooks and the microsofts, the apples, the googles and the amazons and mega cap tech stocks. look at what the stock has done. look at the chart right in front of you here that evan spiegel has delivered in the face of -- look, there were a lot of naysayers around this not that long ago he's turned the entire narrative around >> $100 billion company deserving. when you listen to american express, and they're talking about how to reach people, they're using hulu, but spiegel, who when i first met him, i had to like get a selfie with him for my daughter, totally embarrassing was i thought kind of like, hey, you know what? build and they will come what he realized is that he hadn't built it. now he has, and it's remarkable. it's a juggernaut, and it was a fantastic conference call. when he first started his

conference calls were kind of like -- i don't know, let's belly up to the bar and talk >> you grow into the job. >> orchestrated. >> right you grow into the job. you grow into the job. let's listen to mr. spiegel, in fact, from the call, and we can continue the conversation on the other side >> this quarter we grew both revenue and daily active users at the highest rates we have achieved in the last four years. daily active users grew 23% year-over-year to 293 million, and we more than doubled revenue year-over-year to 982 million, generating 117 million in adjusted ebitda. adjusted ebitda improved by 213 million compared to last year marking our third adjusted ebitda profitable quarter in the last 12 months as we continue to demonstrate the leverage in our business as we scale >> all right, that's evan

spiegel, the snap ceo. i would ask you, jim, i mean, is this the no-brainer social stock to own right now and then i'm thinking twitter because they knocked it out of the park too, and look at those shares this morning. >> i think that advertising is going these guys' way, but that just means that alphabet is going to have an incredible quarter and facebook tooc i remember the early conference calls when we would listen to snap, and the calls were kind of like we're the coolest guys in the room we have really good numbers. hey, you know, we can't get it to work on smamsung and you got to stick with us you listen to him. he now sounds like he's ruth porat at google. ruth is the king, queen of all conference calls it was really impressive ned siegel hit it out of the park he had that great interview with becky. people don't -- these

advertisers, scott, the advertisers don't know where to go, but they do know where youyo younger people are, and they're on these sites i wish that tiktok had a conference caubecause 70 million people are spending an hour a day on tiktok. that's another great way to reach people these people are all very good ned has always been very self-effacing. he was self-effacing again they didn't add a lot of users, but they've gotten a whole lot of new advertisers it's going to be a really good summer and fall for them, and it was just a very impressive conference call. they were both, both great calls. >> you just did a read through also to google expecting a great quarter from that company, which leads me to want to talk about what's on -- what's at stake next week when all of these mega cap tech stocks, which have started leading the charge again in the market start reporting t their numbers, and i'll tell you

what, the street is out in force ahead of those, jim. you've got a call from credit su suisse, they raised the price target on alphabet to 33.50 to 27.55. they also bumped facebook's target up, jpmorgan reiterates apple overweight bank of america reiterates apple as a buy barclays reiterates as overweight the street's getting behind these names early. >> we're looking at the advertising dollars, and i've got to tell you when you've seen the amazon advertising dollars, you're going to start thinking maybe that's the driver. i wonder if jassi's a very tough guy, big giants fan, but everything else is just great. and i think that the number from alphabet advertising is going to be extreme there's so much good happening at apple microsoft, another guy, they're just fighting each other to get more, higher price target, higher price target, and yet let's just talk about reality here and now the american express quarter is

a triumph because it's about millennials and gen x, and i remember when people say, you know what? no one will take the -- the younger generation doesn't want it the unyounger generation wants more than my generation, and i'm a member since '81 and proud of it 40 years, not bad. >> they released some of their reserves as well to help things out, but as you said, i mean, it's a spending story as well. and you know what? i go back -- >> the variant not a factor, and that's the difference between monday and wednesday, scott. we went from variant a factor to variant not a factor even though scott -- dr. scott gottlieb who is on the board of aluna and pfizer the israeli study makes me feel like it's booster time >> yeah, i mean, some of the data coming out of israel that dr. gottlieb was talking about

with becky and andrew is obviously concerning you do have to put it in context as dr. gottlieb tried to do, jim, when you look at the numbers and the falling efficacy of the drugs, who it's really impacting, some of those who were vaccinated very early on are most vulnerable, you know, in january we're talking it's necessary to put everything into context, but it's a crazy world, jim, that we're living in where we were so concerned, and we should be concerned still about the delta variant. cdc's calling it the toughest virus that they've seen in at least 20 years, and yet, we have a stock market that, again, is approaching all-time highs the market's ability to look to the other side of all of that, jim. >> did you hear the way that dr. gottlieb had to dance around the fact that the cdc is rivaling the fda as being the keystone cops of this period the cdc doesn't seem to issue anything that's helpful.

the fda is still carrying these things as emergency use, even as they give a drug that probably doesn't work against alzheimer's the approval these are unelected people that are really doing the job it's almost like their in league with the anti-vaxxers. if the anti-vaxxers, if their parents and grandparents had been anti-polio vax or tb, the interesting thing about them is they would have never been born. just something for those thoughtful people to think about. >> let's listen to dr. walensky from the cdc on the delta variant. >> the delta variant is spreading with incredible efficiency, and now represents more than 83% of the virus circulating in the united states compared to the virus we had circulating initially in the united states at the start of the pandemic, the delta variant is more aggressive and much more transmissible than previously circulating strains. it is one of the most infectious

respiratory viruses we know of and that i have seen in my 20-year career >> all right, you know, jim, what do you do with that coupled with the fact that dr. jha with shep talking about how he doesn't think people clearly understand how bad it's going to get. the market has this incredible ability, jim, to just look past it >> i think there is a sense among the people that are vaccinated that they feel safe we see people in new york going -- leading their lives, and we think that the anti-vaxxers feel that it's just the flu. of course i wonder if they would get the flu shot, they seem to have some sort of ideology against this, but they feel immune, but what's really happening is that people feel we're going to have low morbidity in this country and that i agree with. i think that's our saving grace versus the high morbidity of india. i did love the way that macron yesterday said listen, you anti-vaxxers stay home

britain said look, we're 7% vaccinated g go to the clubs, go get a beer we're going to get this thing to herd immunity. i think what is going on, you know, frankly, scott is a belief that, yes, this is really, really, absolutely contagious, but because of how easy it is to get it, the con ttagion is goin to sweep through the country, and it either kills you or it made you stronger. >> yeah. and you get to herd immunity and the market clearly is looking to that jim, we'll talk more about the market in a minute gm is announcing a new bolt ev safety recall due to potential fire risk. our phil lebeau joining us with the latest details. >> take a look at shares of general motors let's talk about this new recall for the chevy bolt this covers 2017 to 209 chevy bolts, a total population of 68,667 bolts are being recalled. by the way, this is the second

time gm is recalling these bolts to correct the potential defects that are in the battery that could spark a ire. here's what they are telling owners of bolts to do until the vehicles are fixed, and it's fairly intricate they cannot have the vehicle charge above 90% they also don't want it to drain below 25%. that effectively drops the useful range of the chevy bolt down to about 140, 150 mails they miles. they do not want the vehicle charged overnight. if you have one of these vehicles being recalled, you to charge it after every time you drive the vehicle. gm is currently investigating eight chevy bolt battery fires the picture we're going to show you is of a bolt that was fixed in the previous recall, the

november recall to fix the potential for battery fires. it was serviced and fixed, and yet it still caught on fire. this picture was a bolt owned by a vermont lawmaker general motors is in the process of fixing these defective battery cells. they do not say how long it will take to replace those defective cells, but guys, this is not good news. anytime you have a recall involving a vehicle that may catch on fire is troubling, but now this is the second one for the chevy bolt, and you're telling the owners until it's fixed, you've got to have real limitations on the use of the vehicle. guys, back to you. >> yeah, phil, we appreciate that, and jim, why aren't shares reacting more to this story? >> i think the stock's down a great deal because of the semiconductor shortage, in particular this is a wait until next year for gm they've got some various new products ford doesn't seem to be having these problems and also seems to have greater chip availability goes down.

it shouldn't, but that's discouraging that's just discouraging and you know, anyone who knows and follows the work of mary barra i think just feels bad she is trying sohard to get gm into the 21st century, doing a terrific job this is a blow, but please do not count her out. she is a terrific executive. >> all right, we'll be right back, more "squawk on the street" is after this quick break. stocks looking to open higher to end the week like they might hae a better finance system than we do. workday. how do they make better decisions faster? workday. it's got to be something workday. i think i got something. work... hey, rob, you're on mute. hello! hey, rob, there he is. workday. the finance, hr and planning system for a changing world. workday. cynthia suarez needed to buy new laptops for her growing team. the finance, hr and planning system for a changing world. so she used her american express business card, which lets her earn extra membership rewards points

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futures looking pretty good on this friday, the dow jones industrial a 183 point gain off the open next, it's cramer's mad dash. 's largest online commercial real estate exchange. you see it. you want it. you ten-x it. it's that fast. if i could, i'd ten-x everything. like... uh... these salads. or these sandwiches... ten-x does the same thing, but with buildings. sweet. oh no, he wasn't... oh, actually... that looks pretty good. see it. want it. ten-x it. yum! sales are down 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

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it is time now for cramer's mad dash as we count down to the opening bell we're talking a little starbucks. >> yeah, i mean, look, today i'm using this as emblematic of what's going on with certain companies. right now starbucks is breaking out, using an incredible price target, 20 points above here what matters is what we're seeing, whether it be chipotle, okay, whether it be with starbucks, whether it's

domino's, scale is matter here starbucks is doing incredibly well they've got the technology they're able to use their balance sheet to expand. they're doing amazingly in china, but the united states because of cold brew, people like cold brew, is crushing it, and kevin johnson was a technologist as you know, he came from juniper, what a fantastic hire, board member going to ceo by howard schultz, this place is a juggernaut, wow, it is just doing so well it goes higher, scott, even as it's already been lifted >> yeah, pretty decent looking chart, too, right? it went sideways for just a little bit as you come into the summer, and now it looks like it's ramping up again. >> i wish we could see last year in february, march, it bottomed and actually traded in almost stock trading style. in the 50s it broke down to when

bill ackman came on and basically said, it was the four horsemen of the apocalypse was going to be visiting us. that was the greatest buying opportunity i've come across during this market, this period, this strange period that we're in >> yeah, yeah. all right, jim, thank you. the opening bell is just minutes away we'll be right back.

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i think the markets have been going through a bit of a rolling correction really since march. that fits our narrative that we've been espousing here, which is it's more about rotation thans it is about the index. when this happens historically, scott, when you get these rolling corrections, the market always goes after the weakest links first. it reminds me of 2018 when we had a similar conversation, we were talking about a rolling bear market. we thought it would be more severe then. this is still early to mid-cycle. rolling corrections can happen during bull markets. that's what goes on.

we think it ends with a dire correction of the index level. then you could kind of reset the playing field. valuations will be more justifiable and we can focus back then on earnings growth >> all right, that's mike wilson, morgan stanley's chief u.s. equity strategist you're looking at the opening bell and the cnbc realtime exchange this morning. at the big board celebrating its ipo is exponential fitness we'll speak with the ceo a little over an hour from now and outbrain is doing the honors in midtown this morning. how about that, jim. you led into mike wilson yesterday morning. we talked about it, right? mike wilson was coming on and he has been right in terms of this rolling correction, but he does think there's another 10% to go. >> yeah, but i think that what's -- what i like about mike is also what bothers me, okay? it makes you want to sell. when you listen you want to sell you want to say i should take

profits in starbucks i ought to bang out some facebook it's really time to go when it comes to snap. you can't do that. you have to just take the pain i think he has to really come out and say you know what, in these corrections, you want to buy them they're all working for you, and it's real bullish. instead, i tremble a little. i say, ooh, let me get out and maybe i'll get back in you can't do that. nobody's that good, but i do like mike and he comes on and he's good and what can i say i don't want him scaring people. how about that i don't want him scaring people. >> well, the key -- the key to his call really hinges on mega cap tech, the faang plus stocks because they may have -- you know, they may have started that rolling correction a long time ago, right last fall. >> yes, exactly. >> and then the sort of correction started rolling through, and these stocks have picked up again. if the mega cap tech stocks, jim, don't roll over, mike wilson's going to be wrong he needs those stocks to bring

the market down. otherwise the market's not going down you're not going to get 10% in the s&p if all those stocks go up and you're not getting downgrades, you're getting upgrades. >> look, one of the things that i heard yesterday that's interesting about apple. you heard at&t, remember at&t was supposed to be that unbelievably great surprise? well, i mean, these guys these phone companies, look at that, it's down. these phone companies are making deals giving you phones. that's unbelievable for a lot of semiconductor companies. of course it's good for apple. when i look at snap and i look at twitter, do you think they're better than facebook and alphabet and amazon as a way to reach people i think that netflix was the weak sister of the group you can't call it faang, but microsoft obviously is going to deliver a great number too or else everybody wouldn't constantly be saying it's fabulous big cap tech's in charge the question is whether you own a lot of big cap or own a little big cap, but you've got to own it you can't do nothing but own hca

and honeywell. >> what's really on the line, though, jim, if you you consider the fact that, you know, brets in the market has certainly narrowed these stocks have started to pick up a lot more of the weight a lot more pressure is on these earnings reports let's not forget, jim, what happened last quarter. these companies absolutely knocked the cover off the ball home run after home run after home run, and what'd the stocks do you remember what the stocks did, though? they went down most of them went down >> no, that's a good call. i don't like stocks coming in hot. i mean, remember, the bank stocks got a little bit of a selloff, so they were okay, but it may depend that day about what the ten-year's doing. the ten-year's still in charge for a lot of people. by the way, we're seeing some industrials not doing as well as they should. i liked honey well's quarter, but they got to sell that. and kimberly-clark, they had

some raw costs that were disappointing and they also had a slowdown in their top line so that was pretty much everything bad that you could possibly ask for but look, can we just go -- can we go to boston beer for a second because it's very unusual to see a stock basically one of the great head and shoulders patterns of all time, by the way, just completely disappoint at a level where the analysts are saying why did you lead us on why did you tell us things were good how could you not have known this is one of those that at one point they would have done a preannouncement. it was a conference call, an unreal conference call it was more of a -- we have never been sandbagged like this, partner. unbelievable i don't know when that stock's ever going to regain its price earnings multiple. that may be of the year the worst quarter that i've seen >> wow, look at the shares done more than 20%. >> i was just going to ask you, does it get to a level where you

think it begins to look good, and you think it's like falling knife territory? >> well, yeah, if you turn it upside down, it will be at a level that's good. can you turn that chart upside down, so we can get a good look at how boston beer, where i think it's going to bottom when you have analysts just openly calling the guys on the call as clueless, it's very difficult to -- oh, look at that great chart, yeah, it stops right here you don't need a chart to tell which way the wind blows i think the semiindustrials are giving up the ghosts and they will be part of mike wilson's rolling analysis i do think we're getting enough good quarters that we shouldn't get negative >> speaking of, i wanted to check on shares of snap and twitter. let's take a look. we're at the highs of the morning, we're shortly off the open this is as good as it's looked this morning, jim. dow's up better than 200 we've retaken 35,000 on the dow. we're not that far away from a new high on the s&p, and there's

snap so it's the antithesis of boston beer is what snap is doing, what twitter is doing, and what some of those other companies that really had spectacular earnings reports are doing too. >> i absolutely love the breadth of what's winning. usually we've had bad breath lately you've got american express, schlumberger, very good call, stephanie link on schlumberger you've got housing companies you have visa doing well, insurers doing well, airlines doing well, apparel doing well i think that there may not be broad as far as we like, but that's pretty darn good. and schlumberger, by the way, actually had a great quarter schlumberger had been hurting. i would look at the hotels because that's how good american express was, particularly hilton, they've got a deal with them and health care is on fire a lot to like here, scott, a lot to like. >> slb beat on the top and the

bottom or honey well did. >> they didn't like honey well because of aerospace, and stock was up 9 earlier believe me, if you bet against ster yus, you're a darn fool he's going to beat you every single time. he's down there in north carolina with our buddy dave tepper who owns the panthers, whether he likes that new rule for the nfl. one and tdone, right? >> what do you think about that? >> i'm glad you brought that up because that is a talker for sure around nfl, if not all of sports circles this morning, jim. basically if you test positive and you cause the game to be canceled and they can't make it up, nobody's getting paid, and you're getting a fair amount of backlash out of that this morning, jim, as the nfl takes a stand. >> well, i think that the nfl's -- i think that may be jeff pash, the legal counsel because what they show you is

here's the way to do it. can you imagine the guy who has got covid and he causes you to get a forfeiture i mean, remember what's at stake, the paycheck. you don't get paid if you don't play so i got to hand it to the nfl, they know how to get the job done they know how to get the job done >> the question is really -- >> can we draft hopkins? i don't think we can draft hopkins. >> right, right. >> he's a man making a stand on belief of nothing. >> yeah, the receiver from the cardinals you're talking about >> i was going to draft, i got the snake, i was going to draft him nine, ten, now he's off the list >> i had him in fantasy last year, and man, i mean, the guy is incredible player. >> i put him right there with aaron rodgers as a guy i don't want to draft. >> to give more context to what you're talking about, he sort of suggested he was rethinking his future in the nfl once they did

all that >> i noticed this morning, jim, that pro football talk, which i'm pretty sure you probably follow as well on twitter, their sources were saying that one team has eight players who refuse to ever get vaccinated and seven of them were deemed to be too good to cut so i mean, you could have a major issue within the nfl this upcoming season, which, by the way, training camps are summer already underway, and summer's starting in a matter of days >> i think that this ruling's going to make -- test those people's resolves. where's adam silver when you need it, you got the cerebral people in the nba to do what was right. look, a paycheck is what matters. a paycheck is what matters, and i think that pfizer and moderna, which is moderna's stock is doing very well today. if you don't want their stock, then you do want to get sick it literally is true you know that because the death rate isn't going up so now you feel like that's okay to get sick i think that the nfl is going to

turn out to be a leader in how to get this thing done moderna added to the s&p, no one's putting a knock on any -- that is the star of the show, and i keep reminding people that they were the first successful test of the vaccine, and occurred the day the s&p hit a low. they're the leader, and they make me proud that they're an american company >> yeah, you know what props to my guy steve weiss who's been pounding the table on moderna for so many months has added to his position on numerous occasions, and that stock continues to be a winner jim, speaking of since we're talking about the nfl -- >> your guys have been so good i'm sorry, your guys have been so good on the show, guys have been very, very hot, and people should be watching the show. you have a lot of bulls and they're giving you -- they're giving you great ones. farmer jim has done some good work too >> yeah, no, they'll appreciate you saying that for certain.

they're the ones who are doing the heavy lift for sure. since we're talking about moderna and we're talking about the nfl and people are looking forward to going back to nfl games, and we've talked about how the market has narrowed, are you suggesting, did i hear you suggest earlier, jim, or at least intimate that you think we could broaden out from where we've been, that some of these stocks that have been stuck lately because of -- or at least in part of delta could actually start breaking out again, travel names, some of the hotels some of these more cyclical natured stocks. >> i think you have to listens to steve squeri, small medium-sized business doing much better the younger people are feeling very emboldened. the millennials were the big si sign-ups i think that there's a younger cohort that just has decided that this is over or if they get it, it's just something, a sniffle, and they're spending, and i think that that's going to broaden things i also think that the hybrid

model, once again, remember, that's why you keep seeing the homebuilders on the new high list in gaining. the hybrid model is just going to be the model. and scott, you know what, i feel like sometimes the hybrid models -- i mean, even here, i look at the people to the right of me and the left of me, and i realize i'm in the hybrid model because there's -- you're coming from a remote location, and it's here we are in july. so i think that that's the future the hybrid model and the hybrid model's actually good for the stock market. >> you mentioned the big spend that american express is seeing, and i think back, jim, to that conversation, i don't know, what was it a month ago, maybe it was a little bit longer at this point that brian moynihan of bank of america had with becky, where spending had returned or was above like pre-covid levels. to your point, people want to get out, and they're already getting out and they want to spend money. >> 2019 is looking like a bad

year now 2019 we had unbelievable employment, the economy was red hot, and yet, so many companies have taken out 2019 levels we don't want to look at last year's levels obviously, but i mean, when you look at the bank group which has been -- that group is so cheap. my favorite is wells fargo because charlie scharf has just decided to put the wood to everybody. hey, how about this? can we talk warren buffett for a second, he should not have sold wells fargo, i think coca-cola put on a had very good show the other day. some of his stocks are coming alive with pleasure. >> yeah, no doubt. bob pisani as you know, jim, is following the action on the floor of the stock exchange today, hey, bob. >> good morning, scott we are sitting right at the door of a new high on the s&p 500 we'll keep an eye on that. what a turn around here, we're now in positive territory. take a look at the leadership. bank stocks which had a terrible start to the week, they're now positive for the week. tech's the leader back again, up

about 2% industrials are up about 1%. energy is still struggling because oil is coming off of that high of $75 back down after the opec agreement we have had an extraordinary quarter so far this is the mother of all earnings reports, folks. we are one quarter of the way through the second quarter, and the numbers keep going up. 76%. that's what we're looking at, an increase compared to the second quarter of last year you don't see these numbers very often, but we started back on april 1st, 54%, then it went up to 65%, now 76 this is just amazing how these number numbers keep going up. let me show you why the stock market's holding up, why prices are holding up so well number one, the third quarter and the fourth quarter numbers keep rising. that's what you want to see. it's not going up as fast as the second quarter, but it's still going up we have near record profit margins. the record was 13%

that was the first quarter this quarter we're at 12.8 close enough, hey, despite all these concerns about costs and pricing, margins are holding up. those two things, earnings estimates, margins, that's what the market really cares about. the covid variant is a big problem. we've talked about all week, but it's slowing, not derailing the recovery that's the key phrase. the final thing i want to point out is something we've been talking about nine months ago, and it's really coming to the fore now operating leverage is very important here what's happened is companies in the last year have reduced their costs. they've reduced travel costs they've reduced real estate. they've cut jobs now revenues are improving for all of these companies, and as a result more profit is accruing to the bottom line that is operating leverage it's magic pixie dust, and it's all over the earnings reports if you take a look. jim and scott were talking about honey well, i want to point out so you understand how remarkable the recovery has been. honeywell to me is the quintessential global industrial

because they work across so many spaces that touch so many different lives. so aerospace, this is revenues these are sales year-over-year, up 53% safety and productiveityproductc sales, 35% higher. performance materials 10% higher you see how many different industries there are and how many different people and companies they touch that's why they're the quintessential company if you want to take a look at the stock, you can see here it's down a little bit. it's 1% from an historic high honeywell's guidance was okay, not amazing. that's not amazing here's the problem for honey well, it's very, very expensive. honeywell used to trade at 15 to 16 times forward earnings. that's about the market multiple right now, scott it's trading at 25 times forward earnings. it's never traded in that territory before, and that's a problem with a lot of these big industrials. finally, scott, we're looking at

20, 4384 on the s&p. that's the old closing high. we're sitting right at the door of the new high. back to you. >> i appreciate that very much you have yourself a good weekend. you mentioned industrials and we do have fresh economic data out moments ago. manufacturing pmi beating estimates at 63.1 compared to expectations of a 61.8 reading services pmi, though, falling short, 59.8 compared to a 64.2 estimate there's your ten-year note yield, 129 w we're back after this.

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business, when people are gathering to watch a game or something like that. it's coming back this year and we're seeing our carry out business start to rebound. u.s. customers are more and more comfortable going out to pick up their pizza. >> with jim on "mad money" last night. we listen to that and j.p. morgan down grades dominos what do you make of the call and mr. allison? >> look, i am loathe to den great the j.p. morgan analyst. this is up verses 400% in the s&p. you feel you'll both make money. remember, they had plus three comps. peopl pe people were looking for minus one comp no, the numbers were extraordinary.

and a lot of that is, by the way, i know until you had me t tastes really good and a lot of technology had a lot of great stock in terms of not being able to. put the tip on the app it is just a technological marvel by the way, they're doing autonomous driving with little jeeps that go around and give you your pizza by the way, the banana peppers without cheese is the best tomato pie in the world. and tomatoes from philly, i know they're calling me the mayor of east town. go to way way for all i care >> i like the thin crust with the pepperoni and banana peppers. >> isn't it good >> it's really good. >> we'll have it together. i'll come over >> you know where i live

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sometime for "stock trieding." why are we talking about >> part of the action is a company called via mere but not mag nu, which is making most of these cars rescued a company from oblivion. i believe the autonomous driving cars, there's too many of them autonomous driving pieces. but magna needs it he's fantastic he's a great guest really delightful man. >> 11:45 >> i can't believe this. i'm promoting tech check and it's david frost's son, if you were wondering i love being down here it's just fantastic. i'm going to miss working with you this weekend we can do a show this weekend. >> i'm sorry that i'm not

there -- yeah, you do. i'm sorry for not being with you. if they only knew. >> it's one of these facts and it's everything. i hope you'll forgive me for not liking your stock when it was right to not like it and i like that you're no longer going hollywood, you're going wall street. bradley cooper's going to be playing him in some movie. >> right all right, jim, you have a good weekend. we'll see you on the other side. stocks are looking to end the week on an upbeat note we'll be right back. cisco. the bridge to possible.

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is the same company we'll trust to bring us back together. cisco. the bridge to possible. good friday morning. welcome to another hour of "squawk on the street. we're live from the new york stock exchange carl and david do have the morning off. we're going to get a quick check on markets what a week it's been.

we're on pace for gains for all the major outages right now. 43.83. we will have a record close to end the week and the dow is up 10020 points we are 30 minutes into the trading session. we're going to start with american express rising after topping earnings expectations boosted by increased credit recovers and expense on travel plus, slumberger and more demand for software and equipment, shares up 30% year to date and fractionally right now we're going to end with a slide on boston beer it fell flat don't miss an exclusive from the ceo at closing bell at 3:00 p.m.

eastern. >> and you know what, david's usually sipping on a beer during the interview. we love him joining us on a friday afternoon as well but that's usually when he has something to celebrate we'll see if he's sipping on a beer today two other winners, julia and snap >> massive soaring of snap shares they're up over 20% and twitter shares up 2.5% as they not only beat expectations but they guided to stronger than expected quarter revenue. it beat on the user growth and raised guidance for user growth as its investment in augmented reality pays off >> we are continuing to create value for businesses by reimagining the shopping experience through a.r by leveraging the long-term

investments we've made in augmented reality and personalization, we're laying the groundwork for an improved shopping experience. >> meanwhile, twitter ceo and that company's earnings call explained how bitcoin will enable them to move faster with their soon to be released products such as super follow, tiktok and dip jar as twitter blue will expand beyond the test and companies will be able to sell beyond their profiles in the coming quarter. >> i think this is part of our future i think there's a lot of inovation beyond currency that's to be had. especially when you provide more economic -- i think it's important that we continue to work at this pace and invest

aggressively in it >> now, both snap and twitter said the impact of apple's new operating system changes limiting the ability to target ads hasn't been felt and still unclear what the impact will be. bank of america says the results from snap and twitter bode well for both facebook and pinterest. >> i want to get to a point where good news for snap means bad news for facebook. rather than rising tide for both was there impact on the ball about changing privacy and just wonder if there was >> so, what they said is because those apple operating system changes were delayed, that they haven't felt much of an impact yet. they could see one in the next quarter. what they've seen so far is it's been moderate.

they've seen more people in the tracking than has been out there. so, they feel like maybe more people will be sticking with the status quo rather than opting out than many feared but so far moderate impact but they're keeping an eye on it, though definitely not as bad as many had feared. >> take a look at shares of intele ceo warning investors on the call that he expects the chip shortage to drag into 2023 big jump initially because the past quarter was fairly decent immediately. as the numbers crossed last night. managing director and semiconducting analyst good to see you. does the chip shortage aspect and the margin pressure aspect, is that weighing on the stock? >> yeah. the gross margin for the second

half and the very leveraged industry they want their margins to go up, despite the full year guide raise and all of that was because they beat them too their guidance went down wherever gross margins go, that's why the stock is down >> on the demand front, were the comments fairly positive and what does it mean for the other names in the sector. >> it's a very interesting question i think you have a tail of two m-markets. on one side the enterprise market is coming back. think of enterprise as business. your average insurance company, people are going back to the office and the company is to upgrade computer systems so, that's helping on the other side, they talk about this component and so their pc business is lagging in

the second half of this year as you eluded to, they talked about that extending into the next year. and we actually have doubts ass to whether or not this is true component shortage there were demand issues in pcs. because it's hard to believe that component shortages are going to weigh on demand for the next year, year and a half there's perhaps demand weakness being masked >> and how does this set up for a name like a and, d, who has been taking market share from intel. and as we see potential chip shortages, auto has been the big focus and you see it branch into other industries what better positions work >> clearly they're a majority opinion out there.

and most importantly, their biggest market share gains are on the server side that's where you get the 80% gross margin and they sell for 7800 bucks we expect much better news we think that's part of the reason why intel's forecast is weak, even though they wouldn't want to admit it and my biggest competitor was kicking my but, i wouldn't want to admit it either we expect those shortages to ease at some point in the second half of the year and start to catch up. on the good side, i think that's going to lead to upside, particularly on the pricing and margin perspective for example, nice upside for the quarter. we expect other companies to be on the upside. >> and intel said he expects to see more industry consol days, that it's quote/unquote likely

what could those potential deals still look like? and how fast could you see them get across the regulatory benchline? >> they're waiting approve and it's going to close at some point pretty quickly and it's going to close towards the end of the year. i think china is the big potential roadblock there. they're the last to approve the maxim deal semiconductor growth overall has been slowing over the last comdecades and help things look to consolidate. but i agree we're going to see more consailidation in the future >> what's your rating on bellsinger and your confidence he's the right man for the job

>> i've been covering intel for over 20 years. so, i go way back with pat for the first time he was there. again, we look at it where it's a coach joining ateam, and he's going to upgrade the talent. it's going to fix what's wrong so, we're only six months into a tenure we think it's going to take at least two years to bring the people in and fix the company. in the meantime, things could get hairy for intel. we think they're gross margins to keep going down >> thank you very much for joining us later, by the way, don't miss intel's ceo at 11:00 a.m. eastern time all your questions and more answered, no doubt

>> don't think i forgot that you don't -- >> i had forgotten that. so, thank you for reminding me i've been coughing up italian wine left, right, and center so, the misery was compounded afterwards and it's great to be here with you. i was worried at the top of the show i was like is it just me >> here's a look at our road map for the hour, including the wild week, aiming for their fourth straight day of games. 45,000 >> cracking down on another group of chinese stocks. we'll take you to beijing for the latest >> despite beating on earnings, we're going to look at the industrial giant "squawk on the street"

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welcome back to "squawk on the street." we're going it get a chick on markets. 142 points just earlier crossing above 35k. the s&p is 43, 85 is your level there. the nasdaq slightly higher

and major averages is in general and joining us now are vmo, global asset management and j.p. morgan asset management's asset strategist given the sharp pullback we did see monday, and given the fact we've not only reversed the losses, but we're poised to make solid gains, what else did change >> it felt very technical by nature, very systematic. so, to me, that was more about the trend following derisking. but everybody is recognizing the fundamentals are in pretty good shape right now. that might be softer than people had expected obviously, inflation data is coming in high for the growth data but we're still set for one of

the best years of economic growth in the past couple of decades. and further more t does look like we're going to get additional stimulus in the next couple of weeks or more. or more information on additional stimulus in the next couple of weeks. on a 12-month forward basis, the outlook is looking pretty solid. >> first, how do you see the market action this week? we've got pretty strong earnings, stronger than had been anticipated. but is there still concern about this being a peek earnings season or does the guidance we get so far help calm some of those concerns >> the earnings reporting has been very solid so far i don't think it's peek earnings yet. i think we have a couple of very good quarters ahead of us still. i think we're going to be

accelerating, and we'll stay strong through the third quarter. however, there are risks out there in terms of the delta variant is muted it's spreading quickly but muted in terms of thoeffects on the economy. however, that could get demand for certain types of activity, such as cruise's, travel, etc. and finally, the budget, the infrastructure package may not get approved as quick as the market expects >> david, you use the word stimulus was that in regards to mine still making its way to the market and credit that's starting to hit people's accounts right now

or is the infrastructure being debated right now? >> i think it's, in reality a combination of the three and be delivered here in the next couple of weeks and to your point about tax credits and the stimulus in march of this year, when we look at the consumer data, when we look at the checking account balances, consumers are sitting on plenty of dry prouder what was causing angst earlier in the week? to an extent concern that consumers won't bounce back as quickly as expected. they're excited by the prospect but, at the same time, asking questions about whether or not the existing stimulus will help in the next couple of months

>> the bounceback suggests the delta variant, as relates to a market effect, has been and gone in investor's minds. we've had a shock and we're over it >> and maybe it's a nonissue we're still worried about that, in terms of the fact that we're starting to see the spread and hospitalizations and people are beginning to realize this could be a bigger deal in so far as our health is concerned. and they may start cutting back on certain activities. right now the outlook is not that dire and that's what worries us everything seems to be very strong we will start decelerating into the fourth quarter so, the market is pricey and that's -- in our company, we're looking at companies trading at a discount

we don't want high multiples the market is commanding and they're still doing very well such as auto zone, for example these are companies that are doing very well and trading at a substantial discount to their market and peers as well >> what would be your top area to look at if we do see a bit of a pullback in the summer, where you advice clients to increase their exposure >> i would like to buy quality value companies, companies valuable, strong market share. but they're trading at a discount i'm not going to buy companies trading at 30, 55 earnings it fully reflects the fantastic part of them and there's risk that if they fail to deliver, that, if anything, they're going to get pummelled

and because the market is richly valued, therefore, we want to make sure we're somewhat protected from the effects of the protection by being in value companies. >> thank you for joining us this morning. have a great weekend >> as we head to break, have a look at s&p for the week as a whole. up and mer aodnand chipotle are up 15% or so to take o because it hasn't removed the endless mundane work we all hate. ♪ ♪ ♪ automation can solve that by taking on repetitive tasks for us. unleash your potential.

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get the card built for business. by american express. chinese tech company's getting slammed. lively from beijing to explain why. >> so t appears that a long rumored clamp down on private education companies have an effect they started implementing a policy that goes after, after school tutoring. they must register as nonprofit,

they're banned from raising funds for stock market or investment and critically, the document says those that have violated the regulations shall be cleaned up and rectified and u.s. listed companies, as well as overseas are going to face penalties and are in beijing's crosshairs several companies, such as alibaba, 10 cent have funded tech companies the state of the goals of the restrictions is to bring the stress down for the children and bring costs down so parents could consider having more children in line with beijing's other policy so, under these new restrictions, the ban includes after school tutoring on the weekends, during public holidays, school vacations and after 9:00 p.m

so, that is the dated goal but because the document focuses on bringing back public school education and borrowing foreign money, there's been a ton of speculation that another goal is political control. >> thank you so much for joining us appreciate it. >> that is an ugly set of stock charge right there we're taking a look at the etf ticker up since january honeywell moving lower, with revenue topping expectations the hardest hit by energy, commercial arrow, arrow space. adding to robust growth and sales growth, market expansion

in all four segments boosted profits. these are largely baked in seven consecutive earnings now and industrial software in focus, as well as rover technologies, whh poeds we llicrert a 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 rush hour will never feel the same.

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welcome book here is your cnbc update at this hour cleveland's major league baseball team is changing its name in a video narrated by tom hanks on the twitter feed says they'll change their name from the indians, to the guardians. for years their name has been denounced as racist.

last year's unrest triggered by the murder of george floyd prompted him to come up with a new name music from popular japanese video games and even as the olympics get underway, there's cause for them to be cancelled, due to fears they'll add to the rising covid cases reporting nearly 2,000 cases thursday and for the first time moderna's vaccine has been authorized for those under 18. children ages 12 to 17 recommended a get the shot until now, only the pfizer vaccine had been cleared for children back to you. turning back to earnings twitter shares rising after beating estimates. and forecasts surged to 80% from a year ago snap surging 22% up 25 earlier. quarterly profits and joining us is jeffrey

good to see you. thank you so much for joining us how impressive were those snap numbers? >> no one expected triple digit growth they had incredible recovery twitter saw the same thing i think we're seeing across the industry, an incredible resurgence across ad spend and that should help google as they come out. the question is how long can this last? and we're still in the early part of this recovery. and we continue to take in more digital than other solutions for now, it's valuation on snap. >> obviously, there was a lot of user growth there for snap how many years away are we from being at at point where a strong set of prints from snap isn't good for the likes of facebook and instead a market share

debate, not just from a rising tide >> i think by now, it's going to be that way for a while. and the reason why is there's different demographics they're not on snap. they're on instagram i'm on instagram i think the challenge is many- and as they unveil new shows, video games, the map has a billion dollar plus opportunity we've highlighted. there's an incredible runway ahead. i don't believe they're taking away from facebook or google i think the category continues to grow and obviously, google and facebook care about the younger audiences. it's hard to disrupt what they're doing among the younger demographic. and i can see it in all the survey work, where they're spending their time. >> let talk more about twitter

it's still a slowdown from what we've seen in the past nonetheless, it looks like twitter's making more money on a daily basis. what's it going to take to shift from a hold positionen the stock? >> we like twitter and fundamentally checks are getting better ultimately, we think there's better assets than google. and he can complete his role in becoming an operational discipline i go back to usability for users and then what advertisers said they're getting the ry ongoingal, and on facebook, snap in a much bigger way than they are on twitter so, until we see two things change, userability on the other

side, equal or get better, than ultimately they're going to do better and i think that's why you're seeing a pretty big out performance today. snap's up 22% and twitter's up three. it goes back to you have to relatively link preferences and we like snap and google better >> how does this set us up for facebook and pinterest >> i think you're going to continue to see really good numbers. everyone has been saying how much highter can go. we think the stock has 15 to $20 earnings power and you're looking at well north of $400 per share. stock's got a lot of runway. we can see a pathway to $500 over time. and we think, ultimately, a lot

of the headline noise is i love, because i love when there's skeptics and clearly the president, and what he's saying about the platform, i think has created some concern and ultimately, i think all the regulatory over hang has been an opportunity to buy that's been our position for a long time. >> so, you don't see that changing, despite appointments or senator klobuchar coming out with the latest proposal that would strip some of the protections away from these companies? >> we continue to think that advertisers don't care i care we watch it. we're not saying it's not important. but the advertisers don't care and they're going to keep spending as long as they get the roi. >> good to see you as always >> thank you >> a new survey of franchises is looking at how it's impacting

operations >> good morning. ahead of mcdonald's earnings, it's out with the two-part survey of mcdonald's franchisees. staffing shortages were holding back from potentially higher levels franchisees do set pay rates at their own stores and they're cofunding to attract and retain workers when asked how issues were impacting stores, don't want to open dining rooms, can't stop them an increased wages substantially. average wage rate 60% higher than prepandemic the survey of 20-plus operators represents more than 200 locations. despite labor challenges, same-store sales expected to increase in 2022

and the u.s. says business is very strong. franchisees rated their six-month business outlook on a scale of one to five, with five being excellent that's the third highest response in the 17-year history. franchisees noted competitors are starting to see their operations pick up, including casual players it's yet to be seen how it effects the restaurant landscape as a whole mcdonald's stock is fairing better than some competitors but behind winners from last year like chipotle, papa john's. >> another strong week for chipotle, speaking of. as we head to break, watch shares of square today, the other jack dorsey company, up for their fourth straight session, i should say 367. you can see up 1% right now.

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obviously the pandemic happened. and it became even more popular after that >> what dauz strategic mean in. >> we have more acquisitions we're not done we're further stepping into our digital platform over 50,000 users currently on our digital platform, we own our own production studio. we're going to do that and add more brands to our digital business >> it's interesting to think of it that way. you have the actual store fronts

that are franchised out, or brick and mortar then you have the production studio and the digital app how do they fit together and more importantly, hew does that fit in with other companies that is equinox and pelotons of the world? >> it fits into this process we're doing. during the pandemic, it was how we delivered almost 20 million workouts during 2020 >> what's more popular >> today it's obviously physical, right? we convrted all our members to digital and now back to the physical world our digital allows tusz give our brands to people not living within one of our location boundaries so, we're happy to do that >> we hear about covid-19 and getting out and trying to lose weight maybe you've been sitting home snapping

>> people are coming back. so, we've surpassed our precovid numbers. as far as membership coming in or membership revenue. we're no longer concerned are people coming back they are obviously a less competitive landscape. unfortunately, not everyone made it through the pandemic. it gave rise to a lot of opportunities for us and we're seeing a lot of people that maybe haven't worked out in the last eight to ten years now getting back in a location and saying hey, when this is over and the gym opens, i'm going back i'm going to take my health and wellness seriously we're seeing a new group of people in stores >> seeing what that's going to look like when people get in the properties anthony, thanks for joining us on the i scale and i'll send it back to you as

we await >> thank you by the way, getting sanction news out of china. here's the story for us. one or two high profile names. >> that's right. the chinese foreign ministry has said -- china's imposing sanctions on seven americans and an entity to retaliate against the u.s.'s sanctions on chinese officials in hong kong one of the high profile names is the former commerce secretary, wilbur ross. and includes a lot of people in washington d.c and then human rights watch's sophia richardson, as well as hong kong human rights counsel the foreign ministry said that hong kong is china's hong kong and that this is an internal affair the background of this is just this weekend the u.s. deputy

secretary of state is supposed to hold discussions with her counterpart as well as the foreign minister in the port city of tangen near beijing. in fact, earlier today, the foreign ministry spokesperson had accused the u.s. of preaching and of arrogance ahead of this discussion that's supposed to take place in the next several days. wolf >> thanks so much. and interesting as well to see it's down 18% now. it was already down about 14/15% either way, as a sort of barometer for the chinese-listed stocks, it's down 18%. thank you. let's check on the boarder

markets as we check into break all of those embassies up for the week as a whole. the dow's up half a percent. and of course, feels like a very long way from monday's sell off. the best performance sector today up 1.8%. we'll be right back. how? they have a better finance system than we do. i feel like they might have a better finance system than we do. workday. how do they make better decisions faster? workday. it's got to be something workday. i think i got something. work... hey, rob, you're on mute. hello! hey, rob, there he is. workday. the finance, hr and planning system for a changing world.

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the race to erase carbon emissions is heating up but will not stop global warming. what is behind me is a drop in the bucket this plant removes about 900 tons of co 2 new companies like clim works

and galgorms seek to expand direct carbon capture. here is how clim work system works. a box with a fan and filter that only attracts carbon dioxide it sucks in and once saturated, the box is closed. then heated to 100 degrees and pure carbon dioxide is released and collected. one of the few companies doing the capture. installed in zurich in 2017 and by 2020 raised $100 million from microsoft, audi, shopify and stripe now building a larger plant. it has become a trillion dollar market those other kinds of investors that see the long-term return of this >> he likens this to the fast rise of electric cars, solar and

wind farms now the state of california is working to the aggressive goal of carbon neutrality >> we have to try to get carbon at a higher rate >> director of project climate center for law at uc berkley carbon capture has been around but was considered too expensive. >> the price has already come down dramatically. as it scales up, it is not unreal is ittic to think this is a viable opportunity >> saying the world needs about 50,000 capture plants by 2050 which would cost about $10 trillion with ample potential returns beyond of course saving the planet the captured carbon dioxide can be used to make fuel, plastics and even bubbles oil producers are investing

heavily in carbon capture because the carbon can be used to release trapped oil in the ground >> in order to stick within the safe levels of global warming, we have to expand this >> it is a new industry and just getting its feet wet i think the possibilities are quite substantial. >> carbon removal also offers a new opportunity for carbon credit market. companies can get credits for avoided or lower emissions they have to not just lower but remove carbon. now they can buy those carbon credits from removal companies that's why big names like microsoft who want to be net zero and remove emissions by 2030 are buying into this big time >> great reporting, diana. we head to break take a look at the biggest gainers on the dow american express after earnings

this morning salesforce closed the acquisition of slack and mcdonalds now leading the dow. we'll be right back. with barely a bobble. lucia. who announces her intentions even if no one's there. and sgt moore. who leaves room for her room. with usaa safepilot, when you drive safe... ...you can save up to 30% on your auto insurance. get a quote and start saving. usaa. what you're made of, we're made for.

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>> welcome back to squawk on the street quite a reversal california and new york are the latest states to pass laws for a way to avoid the salt cap. robert has more. >> at least 16 states have passed laws allowing this new kind of work around for the salt cap. helping owners and partners. those high earners could avoid the cap by running their state taxes through their pass throughs only applies to individuals, not companies. pass through pays the state taxes and collects the taxes for the owner and the state gives the owner a tax credit for the full amount on their personal taxes. the winners are the state

governments. they collect the full tax and reduce the amount and taxpayers can deduct almost all of their state income tax basically only beneficial to hedgefunders, private equity, chiefs, traders. losers are the federal government they could lose tens of trillions a year due to those higher pass throughs those higher earners are subject to the cap if they are a wager these are state governments passing the work around. continuing to push for a full repeal, morgan >> i was going to pick it up there. i guess there's the federal government, which is the potential loser. they might have seen others move from their states. in the meantime, on which note wanted to ask you the story about the journals reporting that disney is potentially moving 2,000 workers or so from

l.a. to florida. so i guess this is part of the broader theme as opposed to the specific part of the story >> it is but it is all about taxes. disney is getting about half a billion of tax incentives from florida. plus these workers are paying taxes right now in the highest taxed state, about 9.5% i estimate these workers are paying in california in state income tax they'll pay zero in florida plus you've got a housing market in florida that is about 30 to 50% cheaper plus lower cost of living this is a win/win from a tax point. it is very disruptive to move. the company and the workers will save a lot of money moving to that no tax state of florida >> i imagine you can incentive

advise a lot more workers to apply with that as well. robert, thanks for joining us. a quick check on the markets me mentioning before, the s&p 500 had a fresh intraday thank you for being with us. that will do it for us tech check starts now. >> first on cnbc, snap shares take a look at them. surging today inside that earnings beat.