that had a market cap of under a billion dollars in 2019 now you're talking about a market cap of $20 billion. this is not going to get back to 2019 sales until 2024. think about that in terms of fundamentals. >> thank you and maybe you have a clock there. we've got five seconds beck. >> great to see you. great to be back, andeverybody we hope you can join us tomorrow too. right now it's time for "squawk on the street. good monday morning, and welcome to "squawk on the street." i'm david faber along with morga morgan brennan and mike santoli. we are live from the new york stock exchange jim andcarl off this morning let's give you a look at futures, one-half an hour from now, you can see it's called kind of mixed but a little bit up as the implied open at least. we're going to start, though, of course with an update on ida it is now a tropical storm

valerie castro is on the ground in new orleans skps, and she jos live with the latest valerie. >> good morning, david we are in the heart of the french quarters. this was certainly not spared by hurricane ida yesterday. it made landfall just before noon i want to get out of the way and show you some of the damage we've seen this morning. this is actually a portion of a roof here at decatur and taluse. we got here when it was still dark we thought maybe it was one of the balconies from the neighborhoods. it's actually a portion of a roof it also ripped down a lamp post with it and damaged one of those balconies on that upper floor. we want to show you some video that we gathered within the last hour or so of other streets here in the neighborhood. lots of trees down that's certainly the majority of the damage and debris that we've seen in this area. a lot of buildings were damaged. a lot of windows have been blown out, despite the fact that many of them were boarded up

overnight. you mentioned that the storm is now a tropical storm the danger is not over yet, though we have heard several flash flood warnings and advisories for various communities, especially here in the southern portion of the state those still remain in effect in this hour, in some cases until 10:00 a.m. local time. so people are certainly not out of the woods just yet. the other issue this morning is power. more than 1 million people are still without power across the state. all of new orleans is still without power. we lost electricity here around 6:00 yesterday evening entergy is one of the largest utilities in this state. they said there was a catastrophic failure to some of their transmission services. they account for 800,000 of those people without power no word on when that will be restored. >> valerie, it's morgan. hurricane ida made landfall as a cat 4, 16 years ago to the day katrina it was a category 3. just thinking back to katrina,

it was literally hundreds of billions of dollars worth of damage there was also a levee system that gave way. so far based on everything we're seeing and the damage assessments and coming out of this storm, how did the levee system hold up this time around? >> morgan, after katrina, a lot of improvements and upgrades were made. lots of money was put into those levee systems to make sure there wouldn't be a catastrophe like that again yesterday the mayor here in new orleans continued to reassure people that she was confident that everything would hold, that the levee system would do its job. it certainly appears that it did here in new orleans. however, in some of the southern communities we have heard that there were some failures in the levee systems there. the extent of the damage still unclear, although now that it's daylight, we will be able to get a better sense of exactly how bad it was there morgan. >> okay, valerie, thank you. valerie castro in new orleans

for us. we'll begin trading 27 minutes or so from now we had a pretty good week last week we're coming off the comments if chair powell because we had the opportunity friday to trade-off of those comments. anything you're sort of looking for as a typically quiet week given we are ahead of the labor day weekend. >> it is quiet a couple more days left in the month. it seems as if the reflex response to what powell had to say was exactly what probably the chair might have wanted, which is markets is fine we've already been softenedon the notion that we're going to get this tapering of qe process going. the fact that powell was preceded by a drum beat of folks saying this was on the way even with that he said that has nothing to do with when we raise rates. if you look at what the market did, it sort of said, okay, woo ere not assuming that once they finish with winding down the -- so therefore market says we can deal with this obviously the slowdown issue is

probably much more present in terms of is the economy going to be out of spot where we can just sort of shrug and say let the fed get a little tighter on policy you see some of the travel indicators, some of the corporate commentary that we've seen an air pocket in demand in some areas the market has been remarkable in the sense that it's not as if everything's gone off unrelentingly for a 20% year to gain some stuff goes up a lot other stuff backs up you've had 52 new record highs including friday on the s&p 500 itself. >> it is kind of interesting it's like rolling rotations. mini rotations into cyclicals and reflation trades back out into safe havens, back in and i mean, i was off last week and just coming back in reading baa back into the market and seeing we had record closes for the nasdaq, the s&p but also -- and of course interest rates coming off again on those really kind of ambiguous comments. it seemed like goldilocks

comments i keep hearing dovish tapering is the term that's being tossed around right now from the fed chair on friday. small caps having their best week since march 2, which speaks to the fact you have these moves in and out and some sectors are doing really well and it comes back off a bit, and then others start to perform well and it comes off a bit. >> we've managed so far to avert an index wide 5 or more percent decline is that the parts of the market that tend to do well when people are worried about macro stuff and worried about the fed, that would be the big reliable growth they're so much bigger relative to the size of the index than they used to be. it's just a growth index if you really strip it down therefore we're a little bit worried so we're going to buy some of the best companies in the world, like google and facebook are still growing very quickly. that wasn't the case in past cycles you were buying toothpaste companies that were not growing

that fast, but you had to do it, play defense. >> for more on the markets, let's bring in president of ardenny research good morning to you. i want to get your thoughts on the fact that we have markets here at record highs >> well, i heard the conversation you folks just had and i completely agree with every point you made it has been very much a rotating market, rotating almost on a daily basis. it used to be risk on, risk off. now i guess it's some of the pandemic stocks, those that do well when delta news is bad and then sometimes it's going back to the reopening trade so i think investors should be invested in the stock market i think it should be diversified. i have liked the small cap stocks i think they're very cheap relative to the large caps their fundamentals have been great, so i'm targeting 5,000 on the s&p 500 by the end of next year or sooner

>> what are the biggest risks to the market here, ed? i feel like there's quite a wall of worry we could point to, everything from geopolitics to -- we were just talking about dovish taper, but it's a taper nonetheless, it's the fed tightening nonetheless and on down the road. >> the market arithmetic is pretty simple. pe times z, valuation multiples times earnings the question is what's the risk on the earnings side usually it's a credit crunch, it's hard to imagine with credit conditions being so remarkably easy and with the fed eventually maybe raising interest rates and that of course is relevant to the valuation multiple because if interest rates rnt going to go up anytime soon maybe the market can hang onto this 20 fold pe it's had for a year now. >> that's obviously the key part

of the market algebra there. we're looking ahead to 2022. earnings growth is going to decelerate a lot that's always been the case after you come back from a huge profit crunch. i guess forecasts are looking into the 9 to 10, 11, 12 range you're basically saying that your forecast implies the market holds the multiple, and we get -- we achieve those consensus numbers. >> that's correct. that's exactly right i'm gioing to stick my neck out with a valuation multiple where it is now. the reason it's sticking my neck out. it's unprecedented to see a multiple around this level for so long in the face of all sorts of things to worry about but because interest rates have remained so close to zero and the bond yield is back below 1.5%, the valuation multiples hold up remarkably well. we're at peak earnings the second quarter it was probably up 80 to 90% on a

year-over-year basis we are definitely going to see slowdown in the growth rate. that doesn't mean it declines. it just slows down it means the pace of increase and the stock market slows down. it's doubled since march 23rd of last year. it's not going to do that again for a long time. >> yeah, i mean, it's such a key point, ed, is going to be -- and i know you talk about this in your notes you touched on it now. this idea of peak earnings growth you got s&p 500's profit margin at a record 14%. it gets back at this inflation debate just how much do we come off peak, just how much do costs and prices stay elevated i ask you that question as we did get that 30-year high in the pce, that fed preferred inflation gauge on friday as well. >> look, i mean, clearly as you said, there are things to worry about, the geopolitical risk has been heightened by the disaster in afghanistan, and then don't really have clear signs that inflation has, in fact, peaked

as a matter of fact, it's kind of mixed signs at this point, and so it's conceivable that it's going to take longer for inflation to peak, and at some point the market will care about that, and at some point the fed might care about that. but for now, margins really have been a huge story in what's going on with earnings we've had a melt up, an earnings-led melt up in the stock market to a large extent because the profit margins have soared to record highs that speaks to productivity and making a big comeback, and certainly if that's the case, then that's a good offset to some of these inflationary pressures. >> but ed, i wonder about what we should read into the overall aggregate profit margin if it's not just about the missix of companies that are huge in the index that have the very high profit margins as opposed to the median company being able to preserve margins plus lower tax rates, is a pretty decent chunk of higher bottom line profit

margins relative to, you know, decades past >> i think that's true i think the record level of the profit margin isn't really that narrow a lot of companies either have record profit margins or that have made significant progress from their lows of last year, and i think, look, there's a labor shortage out there, and it's structural. the labor force just isn't growing and a lot of that has to do with -- i think a lot of the shock that we can't find workers was kind of baked in the d demographics and i think companies are coming to recognize that, and now all of a sudden they're holding onto their workers tightly. they're giving them all sorts of benefits and increasing their wages. and that would be inflationary without productivity making a comeback and i think they know they have to increase their productivity to augment the physical and mental productivity of their labor force. and they're doing it >> key discussion that we will be sure to continue.

ed yardeni, thanks for joining us >> thank you so much. coming up, ida is now a tropical storm, but not before causing a shutdown of almost all oil production facilities in the gulf of mexico we're going to look at ida's impact on the energy sector, and we're taking a look at futures we are about 17 or so minutes before we get started with trading right here on the nyc, we've got a lot more "squawk on the street" for you straight ahead. it's so good to see you. good to see all of you, yeah! why is jerry so... popular? it's been like this ever since we started using workday. what do you mean? it makes it easier to develop great relationships with our suppliers. now everyone, everywhere loves jerry. they sure do. they do. they really do. mmhmm. workday. finance, hr, planning and spend management for a changing world.

taking a look at crude prices, relatively flat after hitting a four-week high regulators said hurricane ida shut down 95% of oil production facilities in the gulf of mexico joining our conversation on how ida will impact the energy sector is analyst neil dingman of truist securities good morning, what do you take from the i guess what we can infer right now either from the way the market is trading or from early damage assessments that in terms of what it might mean on an enduring basis for production. >> sure. early on, that's going to be the assessment of how long the down time you hit it exactly 95% of not only the gulf production but the gulf refining capacity was down and obviously the million dollar question is how long will it be down because both that production and the refining capacity accounts for about 20% of here in the united states so we've even seen oil prices

reverse this morning early signs are that they shouldn't be down too long, but obviously it's going to be the amount of rainfall and other things surrounding that, but the real picture is going to be because it is a significant amount, as i mentioned, 20% of gulf refining and oil production is still a significant amount. it's just going to be the total down time. >> and in terms of gasoline and other products, refined products, what is the supply situation domestically look like going into this. again, the way the market is trading, it doesn't seem as if there's any kind of a panic in there about shortages just yet >> i think part of that as you saw actually last friday, in fact the demand side of gasoline, which, you know, these days it seems like demand is driving everything demand was down week over week about 2 or 3% on gasoline. so i think that's what the market is trying to weigh to say, okay, we know supply is going to be temporary down, especially the colonial pipeline, which is a major

pipeline that ships gasoline from the houston area to the east coast, a good bit of that to the east coast is still down, could be down for another few days so, again, as long as demand picture doesn't change sharply, but you know, it's going to be interesting. we're into a holiday weekend, driving weekend, so things certainly could change around there if we're still down and we enter later this week. >> neil, are there any names in your coverage universe that you would be buying right now given everything that we're discussing and everything that's playing out whether it is around hurricane ida or in the case of something like natural gas, the fact that we've seen the price surge even before the hurricane to levels we haven't seen in a number of years. >> sure, one, because of the potential down time on probably not playing many of the offshore names right now. again, like a diamondback energy we think is one of the best. magnolia oil and gas this

morning, and number three, the largest oil and gas company out there, you mentioned natural gas prices quite good. eqt tends to bewe think one of the better stocks out there. >> just in terms of how the energy stocks have been trading and what they're discounting right now, obviously had a huge washout from the highs like in the spring and the summer sh bo have bounced since then. what are they dependent on is it about the demand side only we have opec going to come out with a little more of a supply, you know, incremental supply this week. >> i really do i figured it's going to be about almost exclusively demand. all these companies are staying a very capital discipline. as long as demand continues to steady rebound, what's interesting is prices right now are reflecting somewhere around the mid-50s, and here we are almost at $70 oil. so as you said, even though the stocks have rebounded here lately, we think there's a lot of room to run

i'm talking 20, 30, and in some cases 50 to 60% with a lot of these names given what's being reflected with oil on these stocks today. >> so then what is the biggest risk to your outlook, whether it's for the stock specifically or crude and other energy prices that are such a key part of how you're measuring them. >> it's certainly crude, and it's certainly the demand side if for some reason covid related, it was just a week or two ago, it seemed like china was pulling back because of covid related demand issues. we still don't know in the states it seems like here in houston casesare surging again we're almost back at pre, you know, from the early levels. so again, if you would just tell me that going forward demand is going to stay stable, i think this group has a lot -- a large way to run right now again, 50% plus. >> all right, noeil, thanks very much appreciate it. >> thank you still to come, get ready for

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we'll get started with trading, a few minutes from now, and ahead of that let's take a look at at least some names that are going to move, we know for sure, including stuff up in space, which i'm glad you're back >> i've been coddled up for a week with all the space news. >> i can only imagine how hard it's been. global star anaridium, they're obviously companies that support telecommunications in remote parts of the world not to mention other places, and the next iteration of the apple phone may include the ability to communicate via satellite for your phone calls. >> that's right. that's base ond a report from tfi securities analyst, which put out -- he put out a note on sunday suggesting that we could actually see the iphone 13 being able to call and send messages via satellite. talking about low earth orbit satellite, you know, connection, broadband connection, which is that key area that everyone from

spacex to one web, amazon, are building out constellations for, and in that report suggesting that it could be global star that could be the beneficiary given the ties to qualcomm, which is making this custom chip and shares of global star have been surging premarket there was another analyst note suggesting that oridium could be involved in this process as well two names that we don't necessary talk about very much in the space space that are involved in satellite communications and broadband access essentially that could benefit when we see this new iphone come out. that's one piece of the space story this morning. >> it's funny to see those names. we can both remember when they went bankrupt, both of them, but there they are i want to come back to you on star link as well. >> 68% for global star. >> i'm just curious what the implied incremental market size is for, you know, if apple phones have this feature in other words, you know, if we

look at a move like that -- you're talking about basically essentially potentially an addendum to 4g, 5g connectivity. which is going to be key in places like rural america, for example, or -- >> so in theory, it's one more reason to go with iphone as opposed to a competing platform. >> yeah, yeah. and also in general when you think about 5g buildout, for many of the telecos and not just here in the u.s. but in other parts of the world too, part of the way they've been able to maintain or get those licenses for 5g spectrum is by guaranteeing that there's going to be coverage in hard to reach places like rural america, and that's where something like satellite services come into play. >> so you can switch on and off. where are we on star link, which we know, again, is part of spacex, is putting up all those satellites and is conceivably going to be competing. >> yeah, it has been a fierce

launch cadence for spacex. on top of everything else they've been doing worth noting, though, and this came up last week. they like some other names within the launch services, the rocket industry right now are facing liquid oxygen shortages we can talk about that a little bit more behind the bells and a market tech. also we need to get to -- >> we've got plenty of time to talk about a lot more things here at the opening bell, take a look at the cnbc realtime exchange here at the big board, celebrating its 50th, reservoir media, the first female founded and publicly traded music foundation in the u.s. cardi b is there as well are they i don't see them are they in there somewhere. they said they're there. who knows. we were talking about global star as well as star link. but you know, china has been

something we've been greatly focused on of late, for any number of reasons, mike, in particular just a cascade of regulations that the country has imposed on various countries as it tries to clamp down, frankly on the overall power it would seem to a certain extent of the companies and their management teams. that's sort of the broader theme. then they get deeper in. the latest is not having as great an impact as you might have expected in the market, when we take a look at tencent shares china is going to -- is introducing a new regulation, it's been announced by the national press and public administration that will ban minors from playing video games entirely from monday through thursday and on the other three days of the week, you get one hour a day you're only permitted to play between 8:00 and 9:00 on friday, saturday, and sunday >> controlled gaming, so three hours a day. apparently they're going to rely to a certain extent on facial recognition technology by the companies themselves to limit playing time to three hours a

week, and that only being on friday, saturday and sunday. >> and just coming as part of this overall push where clearly chinese authorities feel as if there's just been too much commerce, technological development, capital raising wealth building in areas of the economy that they feel are non-strategic, frivolous, waste of time and counterproductive to the long-term competitiveness of the country. it's really kind of amazing in that sense they're saying we know these companies are great that we've created and they've accessed global capital, but they don't like what it's doing perhaps in terms of priorities in terms of what lines of work people go into and how they spend their time that's amazing when it comes down to it the second biggest economy in the world is being run that way. >> their ability to surveil is unsurpassed. their ability to control these kinds of things in a way that we could never imagine, let alone nothing like this will ever happen in the united states. maybe in my household i might

try to impose that kind of a be ban, not successfully. when does this end when do we know we hit the baseline and now we can start to at least work with a series of regulations that have been impose that had can give us a sense? >> that's the key question and certainly it's one that investors and hedge funds and the like are grappling with right now as you do start to hear the reports that some folks are starting to make investments in some of these big tech chinese names as well. it also speaks to, i think, broader socioeconomic dynamics that are at play in that country, too i mean, you just look at what's going on on the industrial side of things too. this is a country that, and we've been having this debate in the u.s. this is another country concerned about inflation, income inequality, and what this does to the emerging middle class. the fact that you have curbs in trying to put a tamp on prices of key commodities, which it has

ripple effects here too. all of that, i think, is at play and even as we have conversations about port shut-ins and supply chain bottlenecks and everything else that are affecting the world. >> yeah. other names that we're watching this morning include a firm holdings up over 40%, this on news that it may be included on the amazon platform as a way for people to buy over time. >> buy now, pay later purchases over $50 i mean, certainly makes a lot of sense, right and it speaks to, i think, a bigger broader huge growth opportunity from an investor standpoint with some of these names like a firm that are targeting this area and what it's going to mean also for like credit card companies and some of the other more traditional financial services names, and also whether you can potentially start to see some of these names in play as takeover targets. >> right, for sure for one thing the way a firm's shares have reacted, shows obviously the power of just being included on that checkout

screen presumably for amazon it means amazon's not going to do it itself in theory there could have been a sense out there, everybody's looking at buy now, pay later. is amazon going to buy, partner or build that's part of it as well. if you look at the way zvisa and mastercard have performed, fintech purely defined, whatever you want to call that, has outperformed the traditional viva mastercard rails even when we're talking about a comeback in spending levels there's a sense that stuff's going on outside the usual players, whether, in fact, this is requesting to be -- you know, make a big difference or not or whatever but it is kind of amazing coming in a week that we were talking on friday when the news broke that a firm has been viewed as a shadow peloton play because so much of the firm's business was financing those bikes, and they traded in that way, and peloton had disappointment in their outlook last week, and then this

comes along and kind of banishes all those concerns obviously in theory it totally diversifies the business away. >> it was square, right, the australian company that's competitor with firm obviously that deal is still pending. >> absolutely. and you know, the bigger question, too, is what does it do -- i mean, because the whole pitch is it's very transparent in terms of what you will pay over the life of that, you know, financing that purchase as opposed to having this revolvin debt what does it do to credit card rates and what they can earn on balances down the road because if they really disrupt the market, there's a lot of margin there in traditional credit card lenders. >> after pay was the deal i was referring to of course square now one of the larger m&a transactions we've seen in recent times. >> which says something. >> yeah, for a private company. >> one more thought on this, this idea of partnership speaks to the fact that amazon like the other major cap tech players we talk about every single day and

move the markets are under such tight scrutiny, antitrust scrutiny, m&a scrutiny, the like, you do wonder whether this partnership was born rather than saying an acquisition or something else being built, you know, in house, whether it would have been the same dynamic. >> it's trading at 25 billion right now after a 40% move it's easily acquirable by a humongous company. >> whether it will be able to acquire anything after it gets through the mgm deal which nobody expected to face any significant challenges and yet the ftc has been giving amazon a hard time even about mgm. >> they're giving everything a hard time. >> it does make people wonder whether amazon, and any of the other enormous platforms are going to be able to do anything of size or enter into potential partnerships the likes of which we're discussing here. speaking of m&a, the journal reporting on baxter getting close to a deal to acquire hillrom, they make a number of

different things in the hospital setting of course would go along with baxter's current portfolio. there had been reporting on this some time back that they had come at about 144 and then that was not a price that hill-rom was willing to consider. 156 is the price i'm hearing, and they are very close. probably a few days away from signing said deal. all cash, you can see hill-rom shares are up. they had already been trading higher based on previous reporting about the overture that was rejected initially, but it does appear they are very close to getting to that deal, and again, we're talking around 156 from people close to the situation. unclear whether we really have any significant antitrust so that you can see right there at least people are not sending it there is still going to be a spread there given perhaps how

long it would take they are getting very close to that deal as well. >> one to watch. i want to point out just i guess shift a little bit, you know, we were talking about hurricane ida earlier in the hour and the impact on energy, crude and gas lean prices and those stocks as well another group to keep an eye on is going to be your insurers, which are under pressure today you saw many of those names close the week last week bespite the coming hurricane and how quickly it was intensifying, you actually saw them close higher today they're under a little bit of pressure, perhaps not surprising you're starting to see -- and we'll get more detail around this as the days go on and the weeks go on, you start to see more claims, more assessment of damages, et cetera, but you're starting to see some of those risk modeling estimates out there that it could be $20 billion give or take depending on some of the numbers that are being reported in the last 24 hours in terms of insured losses it's the names that you would expect that could, you know, potentially have the most exposure it's names like travelers or

chug or all state, progressive, the hartford, on down the line, reinsurance names as well. and most of those are trading in the red, albeit pretty modestly given the fact this was a category 4 storm that barrelled into the gulf over the weekend but compared to hurricane katrina, for example, 16 years ago yesterday where the levees gave way and we saw hundreds of billions of dollars worth of total economic damage and large numbers, i think some of the largest on record for insured losses as well here in the u.s., this looks to be more manageable and for many of the sninsurers, the property casualty insurers, they came into this with pretty strong books with the rally you've seen in some of the stocks in recent weeks, recent months, you know, they have been able to raise their rates and we have not seen a lot of major, major catastrophes, at least this year

up until this point. >> you know, some of the more recent storms since katrina, remember it was the flooding that kind of, you know, got a lot of cars essentially ruined. >> that's right. >> hurricane harvey. >> that was an element that maybe had been unforeseen and of course after this happens, you always get people who say, well, rates are going to go up it will be bullish finish pnc down the road because they have a little more priciing power don the road. >> we were talking about space before the -- >> yes, yes, please. >> i want to go back there and specifically the rocket side of things a name that is recently public via spac, we've had a number of them in recent weeks but astra shares of astra space are trading lower, they're down almost 20% right now this was after the small rocket company attempted its launch, its first launch since becoming public company it was space force payload aboard as well it was a test flight, and you can see right there this is from

alaska on saturday evening it attempted the launch and about a second accor-- accordin the company, about a second into lift yawn, one of the engines shut down, and about two and a half minutes into the flight, they basically ended the mission and brought the rocket back and the payload back, so there was a full recovery there, but you can see those shares are under pressure because this rocket did not reach space. this is the second attempt by ast astra to reach orbit that essentially failed, did not reach orbit. reregret that we were unable to -- we captured a tremendous amount of data from this test flight we will incorporate learnings from this test into future launch vehicles including the new rocket that is under production right now, that is currently in production.

that's one to keep an eye on, and of course it speaks to something i say all the time, it's very trite, but space is hard which is why it's been very eye opening to see so many of these companies go public and why so many of them have gone public via spac, and of course this comes on the heels of what was a busy week last week with rocket lab, another direct competitor to astra going public and beginning to trade and virgin orbit, richard branson's other space company also announcing that it too now has plans to go public. >> next gen too, that was a week ago they announced that deal to go public. we've also been focused on spacs for other reasons including incredibly high level os of redemptions for so many. not a story this morning let's get to bob pisani for the story on what's hitting the market or not. >> good morning, david, happy monday good to see you as always. flattish open, but the s&p again at a new high. the markets keep rotating around that's the key story for the

month of august. it's been the key story throughout the year. the big winner as we close out august essentially are the bank stocks and technology which have held up well flattish opening on banks, techs doing well, materials okay energy is one of the only sectors that's down for the month. it's a quiet opening for energy given the turmoil with the hurricane in new orleans flattish open, oil is holding in there down slightly, about $68. the key story is really what's going on with the federal reserve and where they might be going here less fears of an aggressive fed. that's the message over the weekend i heard from the traders i talked to. they'll taper sooner, but there's a much lower chance of a multiple 2022 rate hike. the key story is much less chance of a taper tantrum in general. a lot calmer atmosphere around the fed. covid, hard to describe. the market seems to be believing it can work through it despite the high levels of positives

that we're seeing for some people, even amongst the people who have been vaccinated earnings are still rising. in fact, the estimates are rising for the third and fourth quarters still, and most traders believe they're still too low and we have record margins, over 13% for the s&p. that's an historic record. that is why the s&p is at a new high earnings are still rising. belief that the earnings need to go higher and markets are at a record the biggest influence on what the fed is going to do september 22nd, it's going to be that jobs report, and you see what the numbers are here the estimate's 757,000 july we had over 900 june we had over 900,000 so the key story here is the bar to not taper is very high, but i think the bar to begin early rate hikes is also very high at this point, so it's sort of a goldilocks situation here. they're fine with the tapering, fine with putting off rate hikes in 2022. the seasonal weakness we're seeing, that's pretty well-known we know this pretty well of what's going on here

we know august and september are the two weakest months of the year we have three really weak months of the year. september, february, and august, and we're right in the middle of the two weakest months here, september is the weakest month in general that's what we're going into february is also generally a down month, this is since 1945 the averages august is actually a flattish month. even when you get into october, the numbers are a lot better in terms of where we are in terms of the key indexes, the s&p 500 so far this month, neck in neck with small caps. small caps have been outperforming the s&p a little bit. that's certainly a very good sign that's very sensitive to the economy overall. growth is slightly outperforming value. that has been the story all throughout the year. value was a big, big player earlier in the year. david, largely flattish in the last few months. we'll keep an eye on that. that rotation story the main story for the s&p. >> bob, thank you.

bob pisani still to come right here, more on the impact from what is now tropical storm ida we're going to speak with the ceo of generator maker generac let's take a look at how treasuries are faring this morning. yes, it is the bond report first we got friday's jobs reports coming yields, you see it on the tr ten-year more or less zero, not changed we're right back >> announcer: the bond report is brought to you by pimco, a global leader in fixed income.

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jeep grand cherokee l jeep. there's only one. timeline you expect that to be a four to six-week review for potentially an emergency use authorization that puts you in a timeline late fall/early winter. i think that's an optimized scenario if everything goes right and this is an accelerated review like the other applications have been >> that was dr. scott gottlieb earlier on "squawk box" talking about the potential review and/or approval on emergency use

basis for covid vaccine for five to 11, children ages 5 to 11, which is very important for people with younger kids at home trying to sort of navigate the delta variant right now. >> yeah. and -- >> you are looking at me i have a kindergartner this week. >> you are having to deal with that, i am sure. i am sure it's not easy in terms of trying to make decisions or what to do and dmot. meanwhile, we have the eu set to recommend haldton nonessential travel from the u.s. we are at a high in hospitalizations that we have not seen since the peak of the pandemic last winter. >> of course ush havyou have the focus group. the antibody therapies taking on greater importance as well more demand for those. i mentioned it earlier in the show, you are seeing liquid oxygen shortages among some of the space companies and other industrial companies for which oxygen, liquid oxygen is a key use in manufacturing because of those hospitalizations and the need

for them in certain parts of the country, given everything we are seeing with covid patients right now. but pfizer's really been on the forefront in terms of getting its applications in. moderna is the one, i guess, to keep watching. revenue has surged, but the application process -- >> down about 2% this morning. the reallcall of some batches i japan for dcontamination. when we return, airline stocks are rebounded what's ahead now that major carriers plan to cut pcapacity this fall? "squawk on the street" will be right back

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as the summer travel season winds down new data shes that airlines are planning to cut capacity in the fall phil lebeau to explain phil. >> morgan, if you look at the numbers, and we have had these crunched by oag, a airline and aviation consulting firm, all will be cutting back capacity between 7.9% and 11% for united, american and delta southwest airlines, friday they talked about further cutbacks separate from capacity cutbacks due to scheduling to deal with some issues in terms of their

operations they are also cutting their schedule by more than 6% here's the reason why. we have definitely seen a plateau in the number of people who are flying right now i think the number of people flying was down 21% in july. now it's down in the month of august at least 22%. look it. it was 1.9 million people flying yesterday in the united states so what you are seeing here is a definite impact of covid-19 cases as they surge, people -- two things happened. one, an increase in the number of cancellations, and two, people are hesitant about booking their trips which raises the question, when you look at the airline index, what do we except for thanksgiving and the christmas holiday travel seasons? i have heard from executives in the airline industry they are a little more cautious now about what to expect later this year you can't blame them because nobody is quite sure what we will see in terms of the spread of covid and what impact that may have on people and their plans for later this year.

definitely we are going to see a slowdown in capacity over the next couple of months. guys, back to you. >> phil, thank you phil lebeau. coming up, we will have more on the markets we have the s&p up a quarter of 1% an update on the damage from hurricane ida. keep it here

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♪ good monday morning. welcome to another hour of "squawk on the street. i'm david faber with morgan brennan and mike santoli we are live from post 9 at the new york stock exchange. carl has the morning off one half hour into trading, you can see the dow is the lone index down so far with the s&p up 0.26% the nasdaq having a good morning, a half of a%. pending home sales out moments ago. diana olick has that. >> david, pending home sales in july down 11.8%. that's a slice miss. 1.8% that's the second straight month of declines. pending sales down 8.5% year

over year. last summer we saw that huge spike after the initial shutdown due to covid signed contracts, these are for pending home sales, representing closings in the next two months. regionally the northeast sales were down the most, 17%. the only region they were up month to month were in the west, up 2%. now, mortgage rates shav hould helped in july, started over 3% and fell to just below 3% by the end. month but it was not enough because of those high prices and low supply the market may be starting to cool slightly and we have already heard that, of course, anecdotally from open houses and realtors in august so again pending home sales a disappointment thank you. we are 30 minutes into the trading session. here are our three big movers we are watching this monday morning. we start with the firm holdings. soaring after announce ago partnership with amazon that will allow amazon customers to pay for purchases over $50 or more shares of affirm up nearly 40% right now.

plus, satellite services provider global star also surging. that is following a report in apple insider that iphone 13 will have the ability to use satellite communications this is tied to an analyst report over the weekend. you can see those shares up almost 50% 49% for global star. and we will end with a retailer, wells fargo initiating coverage on levi's with an overweight rating a new denim cycle is taking hold and i'll tell you, in my house it is, david shares of levi up 1%. >> yeah, 35% year to date. an update on tropical storm ida. hit the louisiana coast as a category 4 hurricane shepard smith has the latest from cnbc headquarters. >> david, the fifth strongest hurricane to hit the u.s. mainland in recorded history it hit about 1:00 yesterday afternoon and it wasn't until this morning at sunrise that some of it began to calm down. take a look at the loop

you can see where it came in as it did, it went not over land after landfall it was over water for three or four hours. so the intensity of the storm remained very high for at least six hours. eventually, an area west of new orleans got 17 inches of rain in just 20 hours. now, 4,900 national guard troops are out to try to assess the situation. one person died according to authorities in ascension parish when he went outside to check on trees on his property. more than 1 million people are without electricity in louisiana and mississippi. all of new orleans without power. we will go live there in a moment again, the fifth largest storm ever to hit the continental united states. according to governor edwards, 900 members of search and rescue teams from 16 states are in place. 4,900 national guard troops also one of the hardest hit areas, highest wind gusts reported 172

miles per hour near where ida came ashore. that's a critical cub. t you can see the water chest-my in that i can't remember natural gas infrastructure there 90% of gulf oil operations suspended. in grand isle, which is a town where 40 people are said to have remained behind, we are not sure what we will find out of there except that parish president cynthia lee said that they are expe expecting catastrophic damage. whitecaps on the highways. the fire station taking water. in houma, louisiana, terrebonne parish, the sheriff says catastrophic damage there as well electricity and power lines out. eight major transmission lines coming into the area from the local energy company and hundreds upon hundreds of phone poles and light poles are down roads are impassable as a result of all of that the town of lafitte especially hard hit fire-rescue telling wwl, the cbs station there, the highest water

in at least 34 years 500 people in lafitte informed the fire department before the storm that they were staying behind and we watched this morning as they sent out rescue boats to try to find people in their attics or on their roofs who desperately need to be saved from those rushing waters, which are still extremely high there the company intergee deelectrified the city of lafitte so nobody would be electrocuted they didn't want any live wires. and in new orleans the great news from the storm is the levee held more than $12 billion in federal money went into shoring that up, modernizing it 1 of the most modern levee control systems in all the world in new orleans, and the early world all systems go the levees held. the city is intact nbc's jay gray is there for us now. the that's not to say there was no damage, jay. >> reporter: no, shep, you are absolutely right

while the technical issues learned from katrina did seem to p pay off, it was the water with katrina, the wind with this storm. take a look behind me. we are outside the french quarter. the roof was pulled off of the building just across the street and thrown into this area. it pulled down traffic lights. you can see the twisted, mangled arm that held that up. you the wind pulled away the shutters, pushed open doors and shattered windows across this entire area. really across the entire new orleans metro. you talked about the power outages here 1 million people just in the new orleans area alone without power and it's going to be a while before they have it, shep. here is the situation. the eight feeder lines that bring that electricity into the city are in the mississippi river right now. and they are going to have to be extracted, have to be repaired that's a daunting task it's going to take some time

here with the daylight, people coming out, those who rode it out and looking at the damage here they are overwhelmed it is an overwhelming scene. again, it is widespread here, shep it is all across the city, and until you get that power back, and you know this well, it's tough to get that recovery and rebuilding process going in earnest. so they've got to get the power reestablished. the mayor begging people who did move to higher ground, stay out for as long as you can there is nothing for you here. the power is out it's going to be hot it's going to be muggy let the teams get in, do what they can before you come back. a tough ask if you left your home you have been watching this coverage for 24 hours. you have seen the devastation. you want to know what happened to your house. getting back in, i think we are going to see a lot of people do that over the next couple of days here. >> jay gray live on scene in new orleans. jay, thanks. and think of it. to the south and west of new orleans according to local officials many areas have no

power, no water, no sewer, no cellphone coverage see e cut off from the outside world the roads impassable and many small towns in the bayou flooded. where the storm is going now, according to the national hurricane center the storm has about 35-mile-an-hour maximum sustained winds and crawling along at 8 miles per hour. it's expected to speed up and forward progress it's going to go over the central part of mississippi over the state capital, middle tennessee and then northeastern tennessee and eventually make its way up to the washington, d.c., area all the way up to new york city. the tennessee valley 20 people were killed earlier this month by flash floods there. coastal alabama and parts of northwest florida, not a lot of damage at all. just heard from biloxi-gulfport officials a short time ago they have some rain and power problems, but nothing significant there. there are some concerns about central mississippi though and middle tennessee as it makes its way up

for new york and the northeast region, probably some rain by wednesday and thursday, a bit of wind a long ways to go, especially for the people in southeast louisiana where local officials now say they could be without power in some area for weeks and in some isolated areas potentially for months ane incredible storm and a lot of cleanup ahead. >> we certainly hope everyone is able to stay safe and we send our prayers to the millions affected by this right now shepard smith, thank you. back to stocks now with both the nasdaq and the s&p at record highs again this morning seema mody is looking at the reopening trade and divergence in some of the travel names specifically. >> we are watching that storm closely. the reopening trade has been back in play and that is fueling a number of travel stocks, at least the ones that are focused on the leisure traveler. case in point, the cruise lines, despite negative headlines in recent weeks, carnival, royal caribbean, norweigian cruise line up between 9 to 13% this

month. also a bet on the vacation traveler and an increase in consumer spending, casino and gaming stocks among the best performing games in the s&p in august up double digits there a different story for the online travel operators like expedia and the hotel giants, marriott and hilton, that rely on leisure and the corporate traveler remember, for hotels, business travel made up around 40 to 50% of bookings pre-covid, and with more companies delaying the return to in-office work, robert mullins says that will weigh on hotels sans they have a high concentration of their properties in big cities that could bode well for airbnb if more people look to work from a remote destination this fall and winter we have seen this play out this summer with occupancy rates for rentals eight points higher than hotels that's certainly reflected in shares of airbnb which were higher this month. this as the eu is set to recommend halting nonessential travel from the u.s. to european

member states after lifting restrictions in early july mike, that certainly is a big headline this morning. >> absolutely is thank you very much. let's continue the conversation with robin farley, ubs's leisure and lodging analyst. good morning with that framing of what's been going on, the stocks bounce off the lows in general as a group, but still under pressure here as we see decelerating leisure travel trends. tsa volumes are down 70% of 2019 volumes. it's down from 85% in early june so where does that leave you on the sector and on how demand looks the rest of the year >> sure. i think we are seeing a divergence between business travel and leisure travel trends so when we look at lodging overall in the u.s., july, obviously, driven by lots of peak summer season leisure travel, we saw hotels above 2019

levels for the first time in july but that has slipped back in the last month i think, obviously, the delta variant, some of it is seasonal, but there is a normal seasonal slowdown as we get closer to labor day. we are seeing the delta variant impacting close-in travel here. >> so that's on the hotel side i mean, these companies essentially, is it as simple for you as watching that's going on with delta case rates? are they doing anything in response aside from cutting price? >> well, so it's interesting we do a survey every week of five to 10,000 americans asking with are you ready to travel now, a month, two months, six months plus. we saw americans willing to travel at a peak level, 66% ready to travel now in june and that has been drifting down since then with the headlines about the delta variant. it fell under 50% in early august and it's drift downing a little bit in the 40s. that's going to impact the leisure side of things, not just business travel as well.

so that's -- and this is even before we get to labor day when there is sort of the slowdown of leisure travel and the hotels will become more dependent on business travel historically, which hasn't come back to the same degree at all as leisure. >> right interesting point that i think you make on cruise lines, which is that because they are now, many of them, requiring vaccinations for passengers, that in a way it seems like potentially a safer option >> well, for the cruise lines, it's pure leisure travel that. has not been replaced yet. there is going to be demand for that and the ships are now back in service out of the u.s. over the last few weeks so a number of the large cruise lines, carnival, their brands are operating between 40 and 60% of ships back in service yes, they are now allowed to require vaccinations

so really there is nowhere else in terms of vacation options where you know that you are going to be surrounded by close to 100% of other travelers being vaccinated so that's a very good good option for a lot of people. >> interesting how the pendulum has swung in way with, i guess, the perspective on cruise lines. robin, thank you very much appreciate t. thank you. as we head to a quick break, a look at our roadmap the rest of the hour. a closer look at today's market action with the s&p and nasdaq notching new record highs. >> plus, watch this space. we will tell you why shares of a newly public space company are plunging today. and the ceo of generac is going to join us we will talk about the impact from what is now a tropical storm ida. we got a big show ahead for you. don't go anywhere. esg is responsible investing. who's responsible for building esg into your investments?

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antibody drugs now seeing a surge in use that companies, unfortunately, the rise in covid cases. meg tirrell has that story for us >> hi, david these are drugs that have been around since last fall under emergency use authorization. they are available from regeneron, eli lilly and veer biotechnology along with glaxosmithkline. dr. fauci emphasizing these can be helpful for people diagnosed with covid, could reduce hospitalization or death by 70

to 85% they are indicated for people over the age of 65 or who have health conditions that put them at high risk of severe disease these have been underutilized up to this point. even six weeks ago regeneron was shipping about 25,000 doses per week now that's gone up to more than 150,000 doses. hhs tells us that three quarters of the orders that they have seen since july 1st have come from areas of the country with lower v lower vaccination rates. the most from the region including florida. the second most coming from the region including texas we caught up with veer's ceo last week about what he is seeing in the trends right now >> antibodies, i think, finally are getting recognition that they deserve they really do reduce hospitalization and mortality dramatically the u.s., which had an oversupply for a while, has the potential now to have an undersupply.

because of the tests -- [ inaudible ]. >> now, the u.s. government has made purchases from eli lilly and regeneral jon, not vir they tell us right now supply isful. eli lilly's drug had been on pause because it didn't work as well against some of the variants friday the fda enabled use in these 22 yellow states guys, it does work against delta, the fda says, but some of the other variants not quite so much guys >> meg, it's david still has to be infused, right you have to spend time in the hospital or another setting. is there any expectation that at some point it will become injectable >> actually, the regeneron now can be injected subcutaneously you have to get four shots at the same time in order do that vir is also testing the drug to

be given as an intramuscular injection. that's not available yet the iv injection is the primary way they use it. that's a big part of the reason they haven't been used much up to this point. >> meg, thank you. as we head to break, a look at the top gainers on the s&p, including generac. of the ceo will join us later this hour. "squawk on the street" will be right back don't go anywhere. if you're 55 and up, t-mobile has plans built just for you whether you need a single line or lines for family members, you'll get great value on america's most reliable 5g network. like 2 lines of unlimited for just $27.50 a line. that's our everyday price. plus, our plans always come with unlimited talk, text and data included.

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welcome back to "squawk on the street." astra space launching the first rocket since going public earlier this summer. it didn't go as planned this weekend. failing to reach orbit about after one of the engines cut off about one second after liftoff this was on saturday evening from alaska. the flight end bed two and a half minutes after the flight safety crew issued an all engine shutdown grand they were conducting a test flight or in relation with the space force. it has space force payload onboard. returned to earth without injuries or damage to any of the

property however, investors feeling the pain today as well you can see the shares are down about 18%, and, mike, this was the second time astra has attempted a launch to orbit and the second time that that rocket did not actually make orbit. nonetheless, they have have very launch cadence in place the next couple of years and the company definitely saying that they were able to capture a tremendous amount of data from this test flight and that that's going to be incorporated into future launches and the new rocket that's under production as well. >> as an investor, you have to treat it like biotech in a way here is a trial. we got some things we learned. on to the neck step. >> as long as we have enough cash. >> and you have a lot of competition when it comes to launch services, especially in the small rocket section of the launch market with names like virgin orbit, getting ready to go public, rocket lab, which is now traded publicly as well, and

then of course spacex which does its rideshare program for smaller payloads, too. >> big total addressable market in the universe. the stocks are going to keep coming. >> it's still expanding, too, the unverse. >> perfect thanks. let's hit our "etf spotlight" as we head to break the financial sector, ticker iyf, top holdings berkshire hathaway, jpmorgan and visa. capital one getting a downgrade to underperform at baird seeing a 17% pullback ahead stock still up around 70% year to date. notice also discover financial declining along with it. "squawk on the street" will be right back back in two. 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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i'm rahel solomon. more than 1 million people without power in louisiana and mississippi. that's after ida hit the gulf coast as a category 4 hurricane. there are hundreds us trapped by floodwaters. the governor of louisiana says the state has deployed 1,600 people for search and rescue operations. >> we have one confirmed death i don't want to mislead anyone robust search and rescue is happening right now and i fully expect that that death count will go up considerably throughout the day >> bill, oxy, mississippi, no damage there, and streets are flood and casinos are trying keep the water from going beyond parking garages. the islamic state says it is responsible for launching rockets towards kabul's airport. one hit a nearby in addition asnine as five rockets were intercepted and the attack did not disrupt the u.s. evacuation effort set to conclude tomorrow. back to you. >> thank you. we are going to stay with

tropical moisture ida. generac's ceo aaron jagdfeld joining us on the cnbc news line to talk about the impact for that company aaron, good to have you back on. shares of generac are up almost 3% today one of the best perform ners the s&p but the stock had been rallying before we came into the hurricane. that being said, whenever we see a major storm, we see power outages, we to see shares of generac move higher. are you already experiencing greater demand on the heels of the storm for your products? >> yeah, good morning, morgan. we are we are in full storm mode here we have been shipping products, actually starting late last week when we could, you know, we figured out where the track of the storm was going based on the latest forecasts and it stayed pretty true. we have a lot of products down there in the region and headed down there because it looks like these outages are going to be extensive. we heard reports that the large transmission lines that actually bring power into new orleans and the parishes, about eight pair,

i dirns down there. this could be a very long-term event. >> how quickly can you get these products online whether it is generators or, for example, some of the battery storage that you do and other products? >> yeah, the first line of defense here is the small portable generators that get people through the emergency powering of refrigerators and lights, things like that, help you charge your phone. the permanently installed variety, including the storage systems, that's going to be weeks or months afterwards the tail end demand from something like this generally goes six to 12 months afterwards there is businesses, there is homes, you know, a lot of different installations down there that, obviously, are going to be in need of backup power going forward. >> aaron, your current 2021 guidance specifically says you don't assume the benefit for you, for your business, of another major outage event in the second half. obviously, it's early. is this going to change that >> yeah, it could.

mike, you know, we really -- we are basically at capacity now. the pandemic, when it hit a year and a half ago, just shifted our business into a completely different mode of course, on top of that you just had these weather extremities, these events happening almost continuously for the last several years having backup power has become top of mind for people and businesses and so we have been running flat out. we have added capacity we are adding more capacity next year we will get a little bit of a bump this year from this event, obviously, with some of the nall smaller products that we will be able to ship in. we shipped over 100 truckloads of small portable generators in the last few days. that will, obviously, create -- and be incremental to what we have given out as guidance. >> yeah, aaron, you mentioned, of course, sort of the change in nature of the storms becoming more powerful, even ones that might not present a real danger, seem to knock down ploints power lines. do you have hard data how ahn

power is lost by how many in th this country >> we track power outages every day. of course, that's part of our business model, right? so over 50,000 people every single day in this country go without power. it's spread out, obviously, and usually in a large kind of, you know, across a large area. but you get instances where you are haines and ice storms and other localized events that creates massive outages. this morning 1 million plus people outages are on the rise. the last 30 years, the grid is very vulnerable. it's been underinvested in for a long time. you have renewables coming on. there is intermitancy with wind or solar on the demand side the electrification of everything. demand is increasing supply is becoming more variable and that's a bad setup for people -- if you are worried about outages in the future whether you work from home or kids are learning from home or trying protect your home or

business, you need a backup generator. >> which speaks to another business that you are building out right now, the aggregation of all of this distributed energy essentially standing up virtual power plants as well how does this speak to that process at the company and how quickly that can actually happen in some of these key areas where we have seen so many outages. >> we have talk about that before the grid is changing, right. this centralized model where you have large power plants sending power across the huge transmission lines like are down this morning in southern louisiana, that model is changing it's noflg a decentralized model. we are trying to decarbonize the grid you will see localized power production, rooftop solar, storage coupled with that. that's a business we got into a couple years ago you take those localized resources and aggregate them into virtual power plants and you are able to help stabilize the grid on supply or demand

side and that's a big part of our business and it's just taken off. it really is -- grid 2.0, you will thear this talked about in the future, it's going to be a decade or more before this fully sets in, but it is a big trend the grid as we know it is going to change dramatically and the way you get power, make power, and store power is going to change. >> we have a infrastructure that could pass, as much as 50 billion to ardeharden the grid. is that a threat to your generator business if the grid becomes more reliable? >> david, the conservative estimates of being the grid up to the reliability standards we need would cost $3 trillion to do that. as we look at it, 50 billion is a good start but a drop in the bucket in terms of what needs to happen as the grid changes and as weather continues to intensify here, these rapid storms, rapid intensification of storms, i

think the setup here is pretty dicey. if you are worried at all about your livelihood or protecting your home, protecting your business, having some kind of an alternate plan b, if you will, for power is going to be a requirement going forward. >> aaron jagdfeld, thank you for joining us ceo of generac. >> thanks. with a look at the emergency response, we are now joined by former fema deputy administrator sandra knight and former dhs undersecretary of preparedness george force man thanks to you both for joining us let me start with you. what is the main responsibility now of emergency responders and agencies like fema now that the storm has at least -- the worst of the storm is over >> well, good morning. and certainly search and rescue is the first thing you have to make sure people are safe and a lot of people sheltered in place. so making sure those people are taken care of and safe and then

getting supplies and starting to take actions to the power lines out of the way and open roads and put people in shelters if needed >> and, domr. forsman, same question to you. what don't we know, i guess, has to be a key question here in terms of what things look like on the ground in various communities that have been hard hit. >> well, david, that's an important point. it's only been daylight for four or five hours. and so as sandra said, the next probably next 12 to 24 hours will be the emergency response the search and rescue, accessing damaged areas, beginning the damage assessment process, and, frankly, the nature of every crisis event the first information is usually wrong and it's going to be another day are two before we have a real scope and scale on the complexity of what the hurricane has done. >> just to dig into a little bit more, sandra, i mean, i realize that we're still early in terms

of the assessment process, but what is that going to entail in terms of getting to the root of not only insured losses and total economic damage over the coming days? we were having a conversation about power outages. how crucial is it to see something like power get back online for those losses to be mitigated? >> oh, well, extremely important. when you think about the first things after a disaster, you have to have communications and then power and right now we're looking at the whole city of new orleans, most of the state of louisiana and mississippi out of power if it takes weeks, then even generators are going to be challenged but now you are thinking about the connectivity to places like port fourchon, which was hit pretty bad and as shepherd said, operations have been suspended so i think this idea that we have got to really get the power going to even know it's been dark so we don't even know what the damage is going to be.

we know it will be a lot it will be more than laura was because it's in a more heavily populated area with more infrastructure >> and of course, george, we are talking about an area of the country that is a key energy producer gasoline refining. we have seen significant portion of that shut in as well. what could the ripple effects of that be not only in the regional, but to other parts of the country, especially if this does take days, heaven forbid, longer for that to come back online >> i think that's an important point. not only has the production been interrupted because we had to close down the wells offshore, but as we get into the refinery process, even with distribution, you know, this storm is not over it's going to track up to the middle part of the country, out of the -- you may remember some of the most significant flooding we had in this country has been the result of gulf coast haines that worked up through the middle part of the country i think we are on the front end

of what is going to be service interruptions to the energy supply market and also multiple days of continuing impacts of this storm as it works its way up the east coast. >> sandra, part of the concern leading up to this storm, this past weekend, was about the fact that, obviously, this is a region that's dealing with a very haefr covid caseload and hospitals, things like that. obviously, very early to figure out if that has pinched medical resources down there doesn't seem if there has been a lot of injury and fatalities but how does that play into the planning process what can the federal government do, if anything, to try to backstop medical and health care resources in. >> well, fema has the ability set up temporary shelters and temporary hospitalization just like they did at the javits center and other places for covid. even with that, it concerns me because the hospitals are already at maximum capacity right now.

now they are on generators and now you could have other people that are injured or hurt or need medical help so it's a crisis that needs to be taken care of now i know a lot of planning has gone into it i heard someone this morning from a hospital talking about what their preparedness plan was. i think we are a lot more prepared than we have been in the past, but the covid on top of the disaster just compounds the problem. >> george, we are getting reports, one out of corelogic, that estimates the reconstruction cost value could be upwards of $220 billion we have already seen commodity and building prices jump we know that there are truck shortages. how much could that, i guess, pinch the region and efforts to rebuild on the heels of whatever the damage that this storm ultimately has created is assessed >> morgan, i think that's going to be a key issue going forward

because we have had a period of extended shortages, building supplies, the costs are up, and it makes it harder for the recovery process to agbegin. ultimately, not only the response, but the recovery is going to have to occur at the local and state level. frankly, we have got a situation where we have labor shortages across the country and as sandra pointed out, you throw covid on top of it, you talk about a galvanizing effect of bad situations we are in it with this hurricane. >> well, for now we thank you both and leave it there. sandra and george, thank you >> thank you thanks rz. after the break, shares of cybersecurity company iron net under pressure in the second day of trading we will speak with the co-ceo next don't go anywhere.

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oh, actually... that looks pretty good. see it. want it. ten-x it. yum! wrub to "squawk on the street." cybersecurity film ironnet completing a merger on friday. it's now trading on the nyse under irnt the stock rising over the last week it was down this morning, although it is pairing those losses the co-ceo and former nsa director and commander who stood up u.s. cyber command, general keith alexander. general alexander, great to have you back on the show. >> thanks, morgan. an honor to be here. >> let's talk a little bit about what ironnet specdoes not a day goes by we don't talk about cybersecurity threats and attacks and the companies looking to counter them. what makes ironnet different >> four things that ironnet does that makes it different.

first, i'd like to point out what the executive order and what the administration is trying to do in the public/private partnership, getting companies to work together in the private and public sector to work together that's the see thing that ironnet does in order to accomplish that, we have to be able to see threats that no one else can see using behavioral analytics that's difficult you need a great system and great platform if you anonmize that data, we can build a radar picture for sign their allows companies, sectors, states and nations to work together to see the threat in way that allows our government to come in and help defend while the private sector does their portion of it we believe that will fundamentally change the way people think about cybersecurity. if you think about the grid as an example, probably our best customer group right now, the electric sector, helping to

protect those companies. if you think about all those people, they work alone today, or they used to. now you can bring them together so they are a collective group if you think about 90 mid-sized banks as an example with ten people each, imagine those ten people working hard on their one issue. what if 900 people worked together to defend that sector that's the future of cybersecurity. >> you talk about public/private partnership. i have mean, as somebody who was a four-star general in the public sector for the u.s. military and is now, you know, the co-ceo of a private sector company, i wonder how you would assess the current cybersecurity threat and i ask that not only because of some of the hacks and attacks and ransomware, et cetera, that we have seen, but also as we see everything that is playing out in afghanistan right now and other areas of the world, the geopolitical landscape in general, how it comes back to, i

guess, the evolving nature of warfare and conflict and what it means for a company such as yours in terms of demand. >> yeah. that's an excellent laydown, morgan, what you just said if you think about the attacks, what we have seen from the solarwinds attack, what we saw in the attack on microsoft, what we see in the colonial pipe, on jbs, the beef maker. when you look at those attacks, those are nation state and nation site-like atatacks on our country. the problem i had when i ran u.s. cyber command, i couldn't see attacks on private sector. our government is here to defend the nation, but we couldn't see it somebody has to build that picture so the government can see those attacks in time to stop them. not respond after the attack, but to prevent the attack. you bring out a great point. especially in warfare, when you think about what happened in

world war ii, it was pointed out that the rule of air power in world war ii helped change that. that and enigma. now look at the future what's the future? you hit it exactly right cyber. our adversaries are going to use cyber to go after the areas where we are most vulnerable so this really requires that public and private sector to work together to train together and toactually present that capability to protect our most valuable resources our intellectual property. that's what we need to do. >> general, a question about the company itself 93% of your shares were redeemed by those who owned them at the time so you raised less money through the spac transaction than you might have anticipated do you have enough given the pipe, what that brought in and the few people who didn't redeem, do you have enough cash on hand to fund what you need for the foreseeable future >> yeah, actually, we do

we raised 137 million. from a guy coming from the army, this is a lot. and that gives us, for the next 18 plus months, and i believe our stock will be much higher at that time. so if we need to raise money, we can raise it with less dilution. i think that's a good thing. i know some of the companies, i think, regretted not coming in, especially when the stock rose i think that's an artifact of the amount of float and other things i think we have a tremendous opportunity just in what morgan brought out, what the future is of cybersecurity so i'm a huge optimist in this area i know there is a lot of work. u we have a lot of work to do as a company. we see the tremendous opportunity in this public/private partnership and collective defense so we do have the money. and i think we're in good shape. this puts our company, you know, over the next fiscal year plus through 2023 to start the middle of that part, we're in good

shape. thank you. >> and then in terms of your growth projections over the coming years, what are they? >> well, so we put out a press conference, we're seeing, i think, august 10th or 11th we said here is what we see coming on many of the deals that we're doing, we're looking at bringing in five or six companies and what we're seeing and we pointed out those deals have expanded instead of wanting to bring in five or six companies, some of these major things are saying why don't we bring in 50 to 350 companys i think those types of changes for us are huge. also a little bit slower, but it means our annual recurring revenue and if you're looking at our stock as the long-term investment, so for our next fiscal year this will be tremendous it actually increases. so i think that's the big deal for us and with this collective defense model we have something you don't normally see in the cyberworld we're not selling to an

individual company as much as we can sell to both that individual company, but to that sector. and when you think about that, the cornerstones and others bringing them in, that's what we need to do we need to get the mass in there, create that radar picture and help people see the attack >> general alexander, thanks for joining us today with the stock now up 15.5%. it started negative as we began this conversation. we appreciate your time. >> thank you, morgan >> let's get a check on the markets, pushing higher now. the s&p 500 is up almost 25 points at, let's see, half a percent. the nasdaq story, the megacap growth stocks leading the way, apple, microsoft up, and the megacap growth index as well the average stock on the s&p roughly flat we'll see how that plays out rest of the day. (vo) this is a place for ambition. a forge of progress.

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welcome back to "squawk on the street." i'm dominic chu. stocks are near, right now at their highs of the session so far with the s&p and nasdaq notching fresh record intraday levels we want to take a closer look at the energy sector as we continue to monitor the impact of then hurricane, now tropical storm ida. within that sector, which is underperforming today, look at the equipment and oil services companies, they're among the worst performers, check out names like schlumberger. with oil being suspended in terms of production ahead of the storm's arrival, oil prices near the flat line with traders looking ahead to a potential boost in production from opec

and its partner countries, set to meet on wednesday now, i'll send it back to you folks, david, at the new york stock exchange. >> i will take it, dom, thank you. dom chu back at hq mike santoli said it at the top of the 9:00, the s&p becoming a growth index megatechs all up dramatically so far. that will do it for us on "squawk on the street. "techcheck" starts now. good monday morning. welcome to "techcheck. i'm deirdre bosa with jon fortt and julia boorstin carl is off this week. today, amazon partners with affirm as the buy now, pay later craze continues. affirm shares up nearly 40% this