Transcripts For CNBC Squawk Box 20240712

The hospital fed chair jay powell told congress more stimulus may be necessary. A moment ago, looking at the dow futures. Up by about 67 or 70 points. S p up by 10. 50 and nasdaq up by 152. 10year at 0. 743 below yesterdays close. We have a huge line up again today. Amazing. Former Economic Advisor to president Obama Joining us about an op ed hes just penned. General motors Ceo Mary Barra with us. Investor Glenn Hutchens and Dallas Mavericks owner and netflix cofounder and ceo of netflix with Important News to share this morning some stocks to watch you might keep an eye on ar call revenue was a little short results would have been better but customers in hard hit areas postponed purchases including hospitality, retail and transportation clients shares of groupon reported a First Quarter loss that wasnt as bad as expected saying it was challenging, people turned to discounts on Warehouse Club members, flour delivery and e learning. I was willing to send some flowers. We waited up late for you we sat there twiddling our thumbs we made margaritas you were here i think i passed you on the highway. Ships passing in the night. Which brings us to ships im going to get to that. What we said about powell. Yesterday, i said im worried because he said more stimulus might be needed. Or if not, i might stop buying it is like wait a minute. If there isnt more stimulus, i might stop buying things what do we want to hear . I dont know what we want to hear but im telling you it is impossible to look at anything when the fed is buying this much and willing to step up to the plate like this thinking about the federal authorities like this, who is not going to spend additional money on stimulus at this point. The democrats wanted it anyway and President Trump is not going to step spending or take away money right before an election if you think about that fiscal and monetary stimulus being pumped in to the economy, i know we keep watching every turn and twist but with that stimulus reporting things for the near term, i dont know how stocks dont go up. Or the dollar doesnt go down and gold doesnt go up we have to watch all those things thats for sure. When you are living and dying with what the fed does, thats not good typically. Andrew mentioned cruise lines. I love the story of people saying ill never go a cruise again and then they hear, you can get a suite for 250 and they are like what shares of norwegian cruise lines under pressure and the Company Announced it will suspend plans for three main brands excludes alaska trips based in seattle. Those are in september are still going to operate shares of carnival and Royal Caribbean were under pressure on that news as well. Sticking in the travel business, also watching shares of southwest airlines. It announced plans to keep middle seats open through flights on september 30 and reaffirmed face mask policy. It will deny boarding to any passenger not wearing a mask and customers have to complete a Health Declaration on check in stocks fell on the news. I think it goes a long way in making customers feel a little safer. Counter to what united said that theyll let you know if things get full and then you can change your flight plans. It sounded to me like eamon was saying like 20 of people think it is safe to take a flight right now. If you are trying to convince the American Public to come back, moves like this might make sense in doing that. I think i might go alone i can control everything the rest of the family, i dont know. But then you come home to the rest of the family and this is something that has a longer incubation period. Thats always a problem you coming home i dont know. I feel better about it now i read that people dont like in new jersey, people dont like people coming in to hear to new york city to work. Coming into new york city they are sort of dont really trust people going into new york every day. That might just be you. New jersey had it bad but not as bad as new jersey. I have one person to think about. God knows what he is doing when he leaves here you use the bathroom there, right . I have my own private bathroom thats what you think do you have to ever . He goes upstairs when you get back, you are welcome to share my bathroom with me, if you want thats sweet. Thats very kind of you we got some tech news to bring you. Facebook Ceo Mark Zuckerberg saying users will be able to turn off political ads weve been talking about the possibility for a long long time zuckerberg said for those of you whove already made up your minds and just want the election to be over, we hear you. Well introduce the ability to turn off siege political ads facebook will provide information on how to vote and how and when to cast your ballot we had that discussion about the possibility if facebook should just turn off political ads and end the madness. The issue at the time was his worry was what he called the slippery slope this he were saying internally, if you could turn off political ads, would users there for six months a year from now say, we need to turn off all ads or this kind of ad or this kind. It is interesting. I like the idea of not turning them off but having the option to turn them off. That sooeems good. As we get closer to november, some of the local races. They are back to back. I wish i could turn them off on the tv i dont know how to fix my gutters and get those screens on top. We have those have you seen that . You bought those . Do they work yes our competing network had a special one night sponsored by the Gutter Company has it fallen that far they work they do dont things go and clog them well i love my netti pot. I got that from the other network too. The thing that cleans itself yeah, i know. All right sorry. Weve gone to the gutter but before we totally go, we have some other news for you this morning. The wall street journal reporting. This is very serious several civil Rights Groups will encourage big advertisers to pull spending from facebook. This is interesting. The groups are starting a campaign saying the company has failed to make its platform a less hostile place they took out a fullpaged ad in l. A. Times adding to pull advertisement. Saying facebook said it is removing more hate speech. Just another of the many challenges the country is making just moved up over 100. Apples head of diversity Christie Smith is leaving apple to spend more time with her family launching a 100 million racial inequality response to the death of george floyd. Working to boost diversity according it company filings, in 2018, 60 of the work force were men down from 2014 in u. S. , 6 of employees were black, unchanged from when they first started reporting in 2016. Coming up, fall out from memorial day parties the governor of texas saying part of the surge in cases can be attributed to young people in bars more on what comes next. Well talk to groupon cofounder, also the founder of a Company Called tempus that just made cnbcs disruptor list. Well be right back after this businesses are starting to bounce back. But what if you could do better than that . Like adapt. Discover. Deliver, in new ways, to new customers. What if you could come back stronger . Faster. Better. At comcast business, we want to help you not just bounce back, but bounce forward. And now, with one of our best offers ever, were committed to helping you do just that. Get a powerful and reliable internet and voice solution for only 29. 95 a month for three months. Call or go online today. Welcome back Texas Governor said his state hit a new daily high of more than 2,600 cases part of the ip crease to ramped up testing in Nursing Homes and correctional facilities and seeing higher positivity rates in people younger than 30 years old that could stem from people going to bars over memorial day. Arizona, florida and nevada also reporting record increases georgia and missouri are taking steps to reopening georgia now allow gatherings up to 50 people as long as guests stay six feet apart. Bars can open to a percentage of capacity missouri are allowing salons to open new york to allow visitors in hospitals and group homes. They will see to limited time. Governor cuomo announced the u. S. Open will be held on schedule but without fans in attendance players will undergo testing and stay in provided housing and transportation golf, without fans, you dont have the golf plan but tennis without fans is going to be weird. Very quiet have you seen the soccer in europe where theyve piped in the crowd noise. It makes it more watchable and less weird you should just ask me soccer played in europe you dont need to qualify it i have not either now or before. That is horrible dont we have a big soccer presence, nbc. I love that sport. Just the feet, except the goalie yes i played for 12 years. You did when i was a kid and in high school were you like a middle person do you remember your position . Middle back i was right wing sometimes and usually center half. That Means Nothing to me. Moving along, the new cluster in china. Getting worry some an additional 30 dass reported overnight. Macao has a limit now on arrivals from beijing. Residents were told to stay in place. Anyone look being to travel outside the city has to be screened before they can go. Schools in the city were also canceled officials said students should be prepared for the possibility classes wont resume until february unbelievable joining us now to talk about all of it is dr. Scott gottlieb, cnbc contributor, serves on the boards of illumina and pfizer. Lets talk about texas and talk about the idea of spread whether you thinks it young people spreading it but also is it a testing story or a spread story . That seems to be the debate taking place around this country right now. It is remarkable to hear what is going on in china where they are shutting down large parts of beijing for a couple dozen cases. Texas probably has a couple dozen cases from a single bar. Part of it is testing. Positive rate is up. This is an outbreak under way. It is expanding. They are at risk of tipping over looking at the reporting, yesterday was 4,000. Different ways counties are reporting. Some of the groups are reporting higher numbers you heard the government announci announcing measures to slow opening of bars and places in austin and extending work at home orders. In arizona, positive rate is up to around 18 . Florida is creeping up to about 8 these are outbreaks under way. They are worrisome because they are happening in the summer. San antonios governor saying he is worried. He has refused to make masks mandatory. Is that something that will continue i know we value or freedoms but when you look at pub plik health like that, are there plays people will be willing to give and say, okay, you can make this mandatory, even in texas the masks have become a flash point. Private businesses can mandate masks when going in. It seems to be the simplest measures we are not going to shut down again. We have to bear a higher degree of infection we are taking a lot of infection through the summer states are having a hard time imposing any measures to try to bring it downright now in terms of what china is doing, do you look at that and think that should be a model or not in terms of how aggressively they are approaching this . We are not going to be able to do this here. We are not we have a fatigue around shutdown and heading towards the election cycle in the fall, well toll rat a whole lot more infection. What they are going to look at is Hospital Capacity well see at what Point Health Care leaders and workers start to push back at political matters and measures to improve ability to take care of patients it is true the average age of people getting infected is trending down. When you look at it, you see the average age is trending down probably because older people are doing a better job of protecting themselves on the whole than young people are. Ultimately, if you have a lot of infection among the younger age set, that will creep in to the younger environments yesterday, i heard of people criticizing the idea of people going back to look at this drug dexamethasone and some saying why hadnt they tried this sooner but hard to criticize doctors dealing with an unknown virus people had not seen six months ago. Cdc is taking traction in terms of tracking all of this and telling doctors what they should be doing are you concerned about that i am concerned. We havent published data out of the United States. There was data in china that showed patients getting steroids were doing worse there is a sense steroids didnt work and havent worked in the setting of acute response and delayed immune response. It seems the pull monetary insult is High Altitude pulmonary he h pulmonary edema. First the virus response stage and two weeks later, you develop this post inflammatory response. Thats where the steroids seem to work. Do you have a percent and or proportion of mortality from that second incident is that safe to say that it is 50 50 or does it depend on comorbidities. You are saying a lot of times it is not the virus but the immune response sepsis is always scarey. It is tough. Is that what usually kills a covid patient . Thats a great question, joe. It looks like three things secondary infection, so sepsis, pulmonary edema or failure or blood clots. A lot of patients decompensating rapidly were developing blood clots. You hear stories constantly where they say i rounded a patient in the morning and they were fine and in the afternoon, we intubated them. We are going to do a lot better job treating because now we know to anticoago u late, the treatment will be better well do a better job. Just thinking when it comes to children, the disease we had been concerned about that looked like a post covid sort of infection. Do you think steroids would work in that situation too . It seemed like the infection was attacking the whole system at times . It looked auto immune there are some questions of using steroids in post auto immune phenomenon. It will be tough to test because you wont have enough patients it is a small numerator on a large denominator of kids getting infected it is an interesting question. I dont know how well study it efficiently. Doctor, where do you stand on rallies . You know the president has a rally coming up in tulsa would you go to that rally personally, i wouldnt attend a large rally like that, especially indoors all of these large gatherings are going to lead to spread. The presedence right now in the United States is one in 200. With that spreading, we are going to have propagation. We need to have eyes wide open on that. Always great to speak to you. Look forward to speaking to you again tomorrow when we come back, new details on how russias vad mir putin is keeping safe from the virus. Thats next. Looking at the mainers of the s p 500 market mylan leading the way. I feel the weight you carry, as i carry it myself. But as i reflect and see all the Amazing Things youve been doing. One thing is clear, technology has never been so important. Youre turning living rooms into conference rooms, backyards into school yards, and bringing doctors into homes virtually and securely. You are transforming Business Models and virtualizing workforces overnight. Because so much of that relies on financing, we have committed two billion dollars to relieve the pressure on your business. And to help us all emerge from this, weve opened our supercomputers and patented technologies to scientists around the world, accelerating the search for a vaccine. This isnt easy. But as you adapt and move forward, were here with the people, financing, and technology, ready to help. Yeah yyeah yeah hey, hey look at this russian president putin has a disinfection tunnel installed at his country residence. It sounds like a car wash. The video was released anyone entering has to pass through the chamber that uses a fine midst of disinfek tant solution sprayed in a fine mist. I thought it was bigger when i read about it. Not exactly a tunnel i wonder if well ever see one of those around here in the airport. A very fine mist you cant even convince people to wear masks here. Good luck. Once you go through there, it is in our oriface and not even on your skin you are whack to square one if you cough or sneeze. Unless you are wearing a mask, an n95 mask so you wear the mask and get sprayed. Russia has the Third Largest number of cases. Despite the high rate of new cases, lockdown restrictions were lifted in moscow. A Government Spokesperson said there is no longer a danger that russias Health Care System could we overwhelmed coming up, futures up almost 200 points on the dow. Todays prospect for more stimulus a look at yesterdays s p 500 winners and losers as business moves forward, were all changing the way things get done. Like how we redefine collaboration. How we come up with new ways to serve our customers. And deliver our products. But no matter how things change, one thing never will you can rely on the people and the network of at t. To help keep your business connected. To deliver your mail and packages and the peace of mind of knowing that essentials like prescriptions are on their way. Every day, all across america, we deliver for you. And we always will. Good morning welcome back equity futures this morning in the black again, up 170 points after a 500plus point gain yesterday in the cow nasdaq indicated up about 83 cnbc and change research out with the latest states of play poll results eamon javers joins us now. My wife actually insisted i message you to find out the berlin story when you referenced it and left us all even in private, i cant hear about it maybe in private. 10 years ago, i was in berlin interviewing some corporate spies and we went out to this insane nightclub thats all im going to get to hear fair enough on this poll, this is fascinating because we are si e seeing movement. The polling has been locked in on biden and trump the first time, these are the battleground states that are crucial. We are now seeing, joe, for the first time, former Vice President joe biden has a lead in every single one of these six battleground states. The first time weve seen that arizona plus one, michigan plus two, pennsylvania plus three 20 Electoral College votes in pennsylvania North Carolina plus two and florida plus seven why is that happening . Largely around intensity of feelings around the president. 36 say they have a very favorable impression and 51 very unfavorable in those swing states those are the voters the president really needs to capture. Why is it moving now the reason is the two big crises how has the president handled the outbreak, 32 strongly approve. 50 strongly disapprove. In terms of the response of George Floyds death, 23 say the president has been helpful 52 of voters say the president has been harmful the major crises and the president s handling has been causing some of those numbers to move very early on. Still in june. This is the first time we have seen biden have a lead in a lot of these states. Polls are polls. Hes got a solid 52 negative always always 52. 52 i see it on twitter and everywhere else. But the betting sites. Real clear politics, composite and predicted. Those all flipped from trump beg up eight or nine and now being down almost double digits. Those, by the way, arent in a vacuum but move with polls you see the swingstate polls move you see the betting a lot of times that is what they are based on when push comes to shove, eamon, those polls are so wrong but the betting sites are all wrong. I dont know why i was going to hit it up where we are in the composite. 9. 9 and it flipped it was doing okay during covid19 for a while i think it really switched about two and a half, three weeks ago. Go ahead i was going to say, if the president looses three big states, michigan, florida, it makes his path more difficult. You see the numbers moving in response to the events the trump numbers have been very solid over his three years and you havent seen a lot of movement around these National Events pretty much, peoples impression of the president has been hardened if we start to see them go to the news over the summer, that will impact. Youve seen the president respond. In this poll, 71 of people say they have a favorable impression around Peaceful Protesters around the george floyd situation. Thats a huge number yesterday, we saw the president change his approach around the issue and meet with a number of families that had been affected by this police violence. That will continue seeing that some of the news events are driving his fortunes here. I did hear you talking about some business implications saying 28 of people would feel comfortable flying how many people was it for uber or lyft . Uber was a little higher. I dont have the exact number. Only 50 of people said they felt comfortable going back to work that was the start the rest was lower than 50 uber, i thought it was 30 something percent. A little higher than taking a flight but not much higher thank you. Lets bring in Gabriella Santos and ryan deitrick. You emphasize that election is going to become more and more important in terms of the Financial Market youve heard the report. If it looks like joe bidens chances continue to go up, what does that say about the stock market last week, i actually heard some people attributing some weakness early on when it became biden versus sanders, capitalists breathed a sigh of relief joe is moving a little left too. First off, thank you for having me on you are trying to get me in trouble. Talking politics yes, if biden pulls ahead, could that lead to the uncertainty factor it could the market is telling us all about the reopening. History tells us, bull market, bear market, it doesnt matter who the president is it is how the economy is doing you go back 8 0 years how the s p does before or after is right every time if stocks are up three months before, the incouple pant party wins if stocks are down, they will lose go back to Hillary Clinton she didnt win as we get close to the election, how the stock market is performing has a pretty solid record determining who will be in the white house next november seeing the story that the moves in the market and a lot of the gains would be in. Are you in a position to say, okay, right now im more cautious and been bullish . Did you say, wow, it is a great buy or are you one 245 comes on and says now we see the great gains. When did you get bullish or did you . No. You dont remember we turned bullish on equities the last week of march we came out and talked about why we did that. The end of the world we were going to miss the comment one more time. We are extremely overbought here you go back to market history, yes, there is a nearterm pull back this is not the end of a bull market rally what we are seeing is consistent with the bull market okay. Gabriella, you a lot of talks talk sectors of the market regardless of the macro view still where you are, i think stay in tech, other areas . I think tech, health care, those are longterm themes they are going nowhere weve been thinking about having a little more exposure to cyclicals. Weve been surprised how quickly activity is resuming in the economy. We cant do it indiscriminately. We are taking a closer look at financials, Consumer Discretionary and regionally the u. S. Is a very defensive market 34 versus 50 nationally. We want to be migrating to more cyclical fundamentals. Thinking europe and asia. Do you think we are stretched at this point . Weve had a tremendous run off the lows there is a lot of positive news baked in whether monetary or fiscal support or whether it is less bad data and activity. We wouldnt be surprised to have more days like thursday where you get a pull back on any disappointing news this is not smooth sailing necessarily but we have been getting incrementally more positive thats where the shift needs to happen beneath the surface rather than an overall market level. Thank you where you are, ryan . Charlotte but i am from cincinnati and you are scared to weigh in on weve got 17,000 advisors vi to be careful coming up, two big ceo interviews in the next hour. Interviews in the next hour. Gm betw geowisdom and curiosity, theres a bridge. Cofounder. Gained a couple of more pounds. Thats good for the babies. Between the moments that make us who we are, and keeping them safe, private and secure, theres webex. Beautiful. And right now, is a time for action. So, for a second time were giving members a credit on their auto insurance. Because its the right thing to do. Were also giving Payment Relief options to eligible members so they can take care of things like groceries before they worry about their insurance or credit card bills. Right now is the time to take care of what matters most. Like weve done together, so many times before. Discover all the ways were helping members at usaa. Com coronavirus you should be mad they gave this were helpiguy a promotion. You should be mad at forced camaraderie. And you should be mad at tech that makes things worse. But youre not mad, because you have e trade, whos tech makes life easier by automatically adding technical patterns on charts and helping you understand what they mean. Dont get mad. Get e trades simplified technical analysis. Coming up next, veteran businessman making his debut on the disruptor list founder of groupon thats next on cnbc. So im gonna hold on promoting you this quarter. Cool . Drop the taco. Get in the car. Does this sentra feel like a compromise to you . Wait, what. . The handling is good, right . No compromise there. Nope watch this. Umm. Bbrie. Brie brie rear automatic braking. So if this Nissan Sentra isnt gonna compromise, why should you . Youre right atta girl. The allnew Nissan Sentra. With more standard safety features than any other car in its class. Cnbc is unveiling its annual disrupter 50 list recognizing upandcoming Companies Pushing their Industries Forward our next guest is the founder and ceo to a new comer to the list, tempest. It ranked number six joining us now how his platform is using Machine Learning and health care is eric lefkofsky. Eric, thank you for being here today. Thanks for talking to me. Lets talk about what tempest does it uses Artificial Intelligence to collect data that you find in patients immediamedical recordt them the best tests and drugs that might be out there and it came about because of your experience with your wife who was diagnosed with Breast Cancer back in 2015 what did you all find during that experience . I was perplexed how little data had permeated her care. I used to say people it was like a maze i would go to the hospital it was like being teleported back in time 20, 30 or 40 years. I thought there has to be some way to bring the power of data of Artificial Intelligence to health care. So we built a system to basically combine clinical, molecular data scale so we can figure out who these patients were, what drugs they were taking and how they were responding and why and then our approach is a bit unique is to power this technology into test itself so we began seeking patients with Laboratory Tests most often used in terms of care. What we invented all that clinical insight into the genome test we recommended a drug, it would be a drug the patient hadnt and the prior. If we recommended a clinical trial, a trial they were eligible for test was smart basically knew who the patient was and could help doctors make realtime decisions and then we took that same technology in cancer and went into depression and then recently went into Infectious Diseases like covid its incredibly exciting. The one limitation i think you might hit is just how bad electronic records are right now. How are you able to make best use of this. The answer is scale if you have enough records then you can kind of remove a lot of the noise. We built, we use optical care for that procession and then a whole bunch of tools that we internally built to ingest millions of medical records and then we go through to clean them up, pulling out hundred Data Elements per patient the answer is not to have volumes of records because medical records are noisy. If you only have a few its very hard to garner the insights you the actually need to figure out whats happening if you have scale then you can clean these records up real world evidence has become more per vasively used. Cloud executing and other ai tools we built allows us to basically go into the medical error and rip out these key data attributes to scale feign haandu have enough of them at scale you can actually then clean up some of that noise. Eric, i have a more specific question about the research thats possible from this and i dont know how you went from groupon though youre a quick learner or something. Even with covid, youre involved with something called transcriptum research. I one what it is youre looking at whats expressed differently in the genome of different people and covid people, some people respond, Covid Patients some respond to one thing, some respond to another some have less beneficial effects from treatments. Theres all this wide diversity. Cancer as well you put that info into a computer, Artificial Intelligence are you able to discern things that make someone special in terms of how they are responding and specific to their own genome i mean, in theory we should be able to in cancer we do two kinds every time we see a patient we do a genome profile. Genome is dna. Then we do ra, its an interesting signature especially for covid thats where the disease is promulgating. What we do is we set out to look at 50,000 patients that were covid19 positive and then look at the clinical records. Only three or four moves clinical data. Who is responding from remdesivir or hydroxychloroquine or patients that took maybe an inhibitor. Look at that kind of clinic all data then do the transcript on these patients then try to figure out if theres some expression signature that lead us to be able to stratu the fy patients in to some kind of a population. If your ra signature is x youre far more likely to have a problem than if its y the covid tests, like cancer, just knowing youre positive doesnt help you you could be positive but asymptomatic you could be positive and fine you could be positive and succumb to the disease much better than getting a deal on some coupon if you can make this work and turn it into a real technology. Kudos to you we ran out of time i appreciate it. Gets a little arcane a lot of potential for cancer. Coming up, jason furman will join us to talk on the road. A grandfather of 14. A newlywed. A guy who just got into college. Thats why behind these masks, Johnson Johnson scientists are working to accelerate development of a covid19 vaccine, drawing on decades of experience responding to Public Health emergencies like ebola and hiv. For the life behind every mask, the clock never stops and neither do we. music anncr give customers access to precisely what they want, when they need it the most. With adyen, the payments platform that delivers convenience for all. Adyen. Business. Not boundaries. Good morning and welcome back to squawk box here on cnbc im with joe kernen along with becky quick and Andrew Ross Sorkin u. S. Equity futures are up 228 points as far as the dow and nasdaq up 83 and s p up 500. Becky. We were up 250 at 5 00 a. M. Eastern time so, weve seen this kind of fluctuations not as big as other days but some pretty big moves relative to where we were six months ago a couple of headlines for you. Fed chairman j. Powell is back on capitol hill today. Virtually, of course in a second day of testimony before congress this time around hell be speaking to the house financial committee. Yesterday he said a full recovery was unlikely until the public is confident that the covid19 pandemic has been contained. The government is out with may Housing Starts and in less than 90 minutes time. Then Online Gaming Company Draft kings is lower in premarket trading. That stock more than doubled since its april debut. Its selling 14 million shares with the rest coming from current investors. Andrew thanks, becky. In an oped in the Washington Post a task force put together by the Economic Strategy Group Discusses a four part plan for successful economic recovery postcovid19. Joining us now with details of that report that was done by jason furman, Timothy Geithner and others is jason furman one of the authors of that plan. He made an early call on a vshaped recovery for the economy. So youre right there. I want to talk about that in just a minute. I want to get into some of the ideas youre suggesting here in terms of what the government needs to do and how much money we need to throw or spend at this over the next several months yes so thanks for having me. You know, im still worried were not close to out of the woods. The recovery weve seen so far has been assisted by extraordinary fiscal and monetary support and if we pull that away too soon, well pull the rug out of the prospects for the u. S. Economy okay. But one of the things lets go through the list of things you think need to happen one of the things is Unemployment Insurance, how much people are getting paid. You think people need to get paid less because its creating too much of an incentive to stay home i should stress this is a bipartisan plan. Glenn hubbard had my job under president bush we pretty much came together and agreed on almost everything relatively easily. The most important thing is that we dont let expanded Unemployment Insurance go away entirely after july. That would be a large contraction for the economy, incredibly high unemployment, we should be paying people more than normal. But were proposing to taper that down and taper it down in proportion to the Unemployment Rate as the Unemployment Rate comes down the extra money youre getting would go down. We would start with replacing about 90 of what you get on the job and then with lower Unemployment Rates that would go lower. Im going to skip around here you think we need to lend more to small and medium size businesses we dont need more money you want to take money thats been allocated and reall located in the c. A. R. E. S. Act congress set aside 450 billion for lending. Parts of that has not been allocated. Even though the stuff has they dont want to lose money they set up lending programs that are doomed for failure. They can fix those programs with more generous terms, longer term loans and do that without any new commitment of money. They just need the treasury to say we need to be willing to risk the money that Congress Already set aside for lending. Jason, your plan costs at a million trillion dollars more than already has been outlayed what happened if that doesnt happened i know you called for a vshaped recovery thus far you seem to be on track or doing better than others that progre prognosticate lesser fortunes. You saw that tremendous consumption number yesterday that retail sales number that was in part because disposal incomes were up in the month of april because of the work we did and that carried forward when people were able to spend money in may you would see a reversal of that in august and september. You could potentially see us, you know, double dip reversal in terms of our economic trajectory and i wouldnt want to take my chances on Something Like that when were still in a very fragile and very uncertain position with the virus and with the economy. Do you have any worry that the market is creating bubbles because of what the fed is doing and because of what treasury is doing . I think the fed is doing exactly the right thing. I think its too hard to figure out and call when there is and isnt a bubble and try to prick it the market, you know, i dont want to get in a totally crazy place given where Interest Rates are, given the speed which retail sales grew and the like, although i worry it has a little bit of a herdish thing and if we get a second wave, Something Like that, that would be a large negative and that theres, you know remember 50 chance or more of that happening. Lets go back for a conbecause i thought you were on a vshaped recovery. Now youre worried about a second wave . My problem is i didnt know the name of the shape that was verse check mark youre on a v for a while but then the last part of it, the hardest part those are the people that permanently lost their jobs, people that need to find a new sector and the like we see early a very quick rebound. I dont know how far that rebound takes us i thinkto some degree that depends on policy. The other one we didnt talk about that we had bipartisan support in our group for was additional assistance to states and localities that was the only sector that continued to shed jobs in may. If they keep shedding jobs through the fall that would set our economy back, potentially by about a year in terms of economic growth. Now all of you guys agreed on this but you tell me what do you think about everybody in washington, in congress. Do you think they will agree on this i certainly hope so, andrew they came together really unusually quickly in the c. A. R. E. S. Act now they are behaving like they normally do. The house pass ad plan i thought it was a perfectly good plan but the outer edge of a negotiation. The republicans incredible countered with lets start with zero instead of 3 trillion i think they can meet somewhere in the middle. Our proposal is if you tie your plan to economic conditions, that if youre right that the economy is in great shape the plan will be quite cheap if youre wrong then the needed money will flow. So effectively its like buying an insurance policy and thats what i think congress should be doing. Okay. Jason furman, great to see you thanks for coming on this morning and talking about this piece. Its an interesting one. Becky, over to you andrew, thanks when we come back a read on housing. Mortgage applications. Diana oleck will break down that break. Then we have General Motors Ceo Mary Barra she will join us about whats happening now. Some initiatives they are taking now and also in the market squawk box will be right back. Businesses are starting to bounce back. But what if you could do better than that . Like adapt. Discover. Deliver, in new ways, to new customers. What if you could come back stronger . Faster. Better. At comcast business, we want to help you not just bounce back, but bounce forward. And now, with one of our best offers ever, were committed to helping you do just that. Get a powerful and reliable internet and voice solution for only 29. 95 a month for three months. Call or go online today. Mortgage application data released diana oleck has the numbers. Diana, good morning. Reporter good morning. They dont defy expectations especially from home buyers. Mortgage applications to purchase a home rose 4 last week compared to the previous week and a remarkable 21 higher than the same week one year ago. Thats according to the Mortgage Bankers association seasonally adjusted index that was the ninth consecutive week ever gains and highest volume in more than 11 years pent up demand from the Spring Market combined with a record low in the 30 year fix are fueling the heat average contract rate for conforming loan balances fell to 3. 3 from 3. 8 with loans with a 20 down payment lower rates fueled refinance demand those applications rose 10 for the week and 106 higher than one year ago refis had been slipping but new record low may have woken some homeowners up to potential savings. The only thing standing in the way islack ever supply, existing home market is positively drained Home Builders are ramping up again. Recovery in the building market has been impressive. Even in may Mortgage Applications to buy a newly built home were up 10 annually and in about an hour we get the may housing start numbers. The expectation is for a very solid gain there as well back to you. Okay diana, thank you for that report we got a lot more coming up right here on squawk box in just a minute. When we return, Police Reform front and center in america. Well take a look at the role of the muni bond market and how its played in compensating Police Brutality victims we got that story when we return then gmc ceo, mary barra well talk about reopening of america and their plants and so much more. Squawk box returns in just a moment announcer time now for todays aflac trivia question. Which billionaire investor once appeared on the popular tv series the office. The answer when cnbc continues i . Well, then they started getting bigger. Eighthundred dollars. Eighteen hundred dollars. I saved for this. But not that much. Im glad i had aflac. They gave me money when i needed it most. Thats why aflac is here, to help with the Expenses Health insurance doesnt cover. I love that aflac duck. Aflac get to know us at aflac. Com try natures bounty sleep3, a unique trilayer supplement that calms you, helps you fall asleep faster and stay asleep longer great sleep comes naturally with sleep3. Only from natures bounty. And their financial wellbeing. Since our beginning, our business has been people. Its evident in good times, with decisions focused on the longterm. And crucial when circumstances become difficult. That continued emphasis on people our advisors, associates, clients and communities gives us purpose, strength and a way forward. Today. And always. Deposit checks, check balances, pay bills, and more. Explore all you can do with our Digital Tools from almost anywhere. Pnc bank. From almost anywhere. Like real bad. We cant wait to get you back so weve added temp checks, face coverings, social distancing and extra sanitizing to get the good times going again. Were finally back. And cant wait until you are too. Announcer now the answer to todays aflac trivia question. Which billionaire investor once appeared on the popular tv series the office . The answer, Warren Buffett in 2011 welcome back to squawk box this morning more protests last night in parts of the country 23 days after the Police Killing of george floyd. The topic of Police Reform front and center, little known role of the Municipal Bond markets is largely flown under the radar. Leslie picker joins us with more on this story. Reporter the village of hempstead, new york says the city owes money for puncturing his kidney now looking to the Municipal Bond market has become an increasingly common way for cities and taxpayers to fund the costs of paying for claims of police misconduct. A study by the action next on raising the economy found over the decade ending in 2017, investors generated more than a billion dollars in interest from these type of bonds in just five major cities the total Deontay Coston taxpayers in those five cities was almost 5 billion. Now critics say the this is shielding police from the financial consequences of their actions and therefore should be a bigger part of the conversation for reform. Others say that access to borrowing are necessary to make sure are victims are compensated for abuse. It may not be clear to investors they are purchasing bonds for that purpose sometimes its judgment Obligation Bonds dedicated to funding settlements but other times they are wrapped in a larger bone issuance, guys leslie, thank you very much when we come back, General Motors Ceo Mary Barra will talk to us about the reopening of america, income equality and the state of the industry. It was hit hard by the pandemic and slowly climbed back above 27. Mary barra will join us in a few minutes. Squawk box will be right back. Yeah yyeah yeah hey, hey couple of names you might want to take a look at today the this first one, dow component 3m is up a percent in the premarket thats obviously helping the dow this morning, up 1. 15 norwegian cruise lines, though, headed lower this morning, i think we mentioned from the cruise lines so volatile recently a lot of conjecture and discussion about day trading and all kinds of things thats been happening and one of the names weve seen that expressed. Qualcomm, take a quick look at the qualcomm chart and then get on to for our next big interview. Qualcomm trading higher up almost 2 . Nearly 2 . Andrew okay. Thanks when we come back big interview. Gm Ceo Mary Barra will join us take a look at the futures dow up 191 points. S p 500 looking to open up 20 point hire nasdaq about 72 points higher. Then later in the 8 00 hour well hear from netflixs cofounder and ceo, Reed Hastings stay tuned for the that. Squawk box returned with mary barra in just a little bit yeah yyeah yeah hey, hey you have the support of a, probiotic and the gastroenterologists who developed it. Align helps to soothe your occasional digestive upsets twentyfour seven. So where you go, the pro goes. Go with align. The pros in digestive health. And if stress worsens your digestive issues, try new align digestive destress. It combines aligns probiotic with ashwagandha to help soothe occasional digestive upsets, plus stress that can make them worse. And try align gummies with probiotics to help support digestive health. Welcome back, everybody. General motors held its virtual Shareholder Meeting he yesterday amid a difficult 2020. Closed plants because of coronavirus. Crisis of racial inequality in our cities and workplace increased transparency and Corporate Responsibility and maybe a little bit of consumer pent up demand as well mary barra is the chairman and ceo of General Motors and she joins us this morning from the Gm Tech Center in michigan mary, its good to see you thank you for being here its great to be with you today too, becky thank you. Lets the talk a little bit about the year you have seen so far, leading up to the Shareholder Meeting you said this was a tragic year can you walk through what youve learned, what youve seen, what youve experienced this year when you think first about the pandemic it started with our operations in china and has moved through the entire world so weve been experiencing that and trying to make sure that we do everything we can to keep our people safe, as we look at this we want to make sure we protect lives then livelihoods so weve been applying learning from across the globe to make sure that we can do just that and so as you look at that, which has had a tremendous impact on our business as it has many businesses across the globe, and then with the incidents dealing with the social inequity and racial inequity, clearly that has been hanging and very heavy on all of our hearts so those are serious issues that we need to look at from a business perspective but also doing whats right and making sure that we create an environment to be inclusive for everyone we have a lot of work that weve outlined and were very committed to taking action not just talking about why things are happening but what are we going to do to be part of the change i want to talk more about the justice and equality measures in just a moment but before we get to that let talk about some of the things you mentioned yesterday at the Shareholder Meeting and leading up to that you said by the end of this month youre hoping to get gm production levels back to the precovid levels thats a tall order considering what you all have been doing in terms of having to handle the shut downs and then shift to make personal protective equipment that people have been using for the Covid Response too. Is that a goal youre likely to hit . Yes i have been in eight of our plants in the United States over the last few weeks, plan to visit more, ill be in another one of our facilities tomorrow so the return to work has been going prettywell we took the time to really train everybody on what our safety protocols are and why they are so important but then very importantly listen to everybodys concerns and questions. And i think that has allowed us to make sure people return with the protocols that with all the work weve done we believe are safe but also to give them confidence in safety that has been very, very important. We have well over 90 of our team in the United States back and most of north america and so we believe were on track for virtually every one of our facilities to be back to the levels they were producing prior to the impact of covid in this country. Were also back as it relates to china, korea and other locations around the world south america is coming back up. Its a little slower because they are at a different point in the curve as it relates to the coronavirus. Does that create any problems just in terms of your supply chain, particularly looking at some of the situations in mexico that we had seen earlier too have you had issues trying to make sure everything you need to make these cars . You know, were working through them we have a complex Global Supply chain so theres always challenges were working very closely with local and federal governments and many countries as well as our suppliers, and, you know, were on a good path t i think we can successfully work through those as we progress to the end of the month and then into the Third Quarter theres been a lot of questions about consumer demand, and i know there are issues as people worry about their jobs, worry about whats going to happen next. But then there are probably potentially other buyers who had been out of the market or maybe never bought a car before who think wait a second, i need a car, i need my own transportation because i trust Public Transportation less what your trying to see as you see car dealers reopen around the country . Weve been pleasantly surprised how demand has come back it didnt drop as low as it had in other countries in the United States even during the height of the peak from an impact perspective. So were cautiously optimistic we do see people very interested in completing much of the transaction online using our shop, click drive tool most have sign up for a clean certification in a contactless delivery and thats giving consumers confidence as well its too soon to tell but were cautiously optimistic as we see demand resuming. Where is demand coming . Is it pent up demand are people looking to buy trucks or cars . What have you seen from the consumer weve seen strength in trucks and because of the strength of our truck franchise and the fact that we just have been over the last year and a half launching all new full size trucks both light duty and heavy duty were also now launching our full size suv, the chevrolet suburban, the tahoe, gmc yukon and the escalade were encouraged the demand has been strong now were starting to see crossovers in suv demand also increase just in terms of trying to restart financially, you all obviously took some measures to try to battle the shut downs you were dealing with during the Second Quarter do you worry there are more repercussions to come down the road i think its a very uncertain time i think when you look back, the steps weve taken over the last five, six years to strengthen the company, making tough decisions and transforming our industry that put us in a much better situation as we faced this pandemic. Right now were hopeful that well have a strong recovery, but were playing multiple scenarios to make sure the company, that were strong from a business perspective and can weather whatever outcome right now were cautiously optimistic mary, one thing i want to ask you from a cnbc poll thats out this morning, weve been testing people to ask them how they feel about thing coming back. 50 said they would feel comfortable going back to work only 28 said they would feel getting comfortable on a flight. The number of people taking an uber or lyft was 34 as somebody who owns a stake in lyft what do you think about the ride sharing of the future and how much that will be impacted by this pandemic i well, i think right now youre seeing people for the most part being very cautious in shared environments across many levels but i think as we look and move forward we still believe in ride sharing especially as it relates to Autonomous Vehicles if you think about an Autonomous Vehicle takes out one more variable from a potential exposure perspective so i think as we move forward ride sharing will be important and autonomous, i think, will be even stronger. Again, especially if you look at how we designed the cruz origin as well from a separation from a cleanliness perspective. Andrew . Mary, i just want to ask you about the Autonomous Vehicle business and specifically there are some reports that amazon is in talks to buy zooks one of the Autonomous Vehicle Companies Still out there. Would you support that acquisition . Theres been some questions whether amazon, as you know, given big techs role in society should be allowed to buy other Companies Like that and get into spaces like this well, andrew, its really not my decision of what amazon does and what happens to zook what i know is the way were approaching autonomous with cruz having the integration of the way we do the development with the vehicle team working handinhand with the team thats doing the autonomous i think that puts us in a very strong position and im very pleased with how the cruz Team Continues to hit milestones even with some of the challenges of the pandemic so im very optimistic and very pleased with how cruz is progressing in developing the technology because the key is having the technology where you can demonstrate that youre safer than a human driver. Mary, the travails of heart are well documented. What does the state of the rental car industry mean to the big three, or automakers in general in terms of maybe not being able to count on fleet sales, et cetera is it going to be a different world when this is all said and done we have seen the retail customer come back into the marketplace much more than the fleet customer over the last several years General Motors has been decreasing the amount of vehicles we sell specifically into rental its had much less of an impact on General Motors and we think when you look at the commercial fleets that business will regain will have stronger demand as we move forward. Its low right now but there is a time where commercial fleets have to upgrade their vehicles in their fleets. Over time that will come back as well and, again, rental has less of an impact on General Motors because of our position. Has the movement in oil prices lessened the mandate to move toward hybrids and electric vehicles, do you think and to smaller more gas efficient vehicles at this point . I know how profitable trucks and suvs are are we back to thinking that thats what americans want do you have to consider things like that . Well, i think overall people look at their total cost of ownership. If you think about the improvements that have been made from General Motors perspective in the fuel economy and emissions improvement in our full size trucks and suvs and midcrossovers its giving people more choice we still do believe in an all electric few of and were using this time to accelerate wourk. Lets get to all electric vehicles as quickly as possible and do it in a way where were creating value for the customer, that they have the vehicle in the segment they want. Its foshl has the right range in the world. Were working to make sure working with Energy Companies as well as start up companies and kind of a collection of companies that theres a robust charge infrastructure. When you have all those questions answered, were seeing a willingness and stronger interest from the consumer in electric vehicles. Mary, lets talk about a letter that you wrote to your employees and your suppliers i think it was on june 1st, after that weekend where we had seen so many protests around the country. You wrote some pretty moving and powerful words you said that im impatient and disgusted by the fact that as a nation we seem to be placated by the passive discussion of why. Why does this hop. Why cant we get to a different place. Lets stop asking why lets start contingent what. I wonder first what is the response that you received back from your employees and your suppliers after that well, so we shared it with employees on saturday and then we shared with it our dealers and suppliers on monday and the response has been overwhelmingly positive hundred of people responded on our internal site for communications and then ive had dozens and dozens, probably over 100 individual emails from our employees and suppliers and dealers, all around the world with support and sharing that same frustration that we cant let this keep happening, we need to drive real and lasting change and recognize that, you know, theres systemic issues that need to be addressed how do you address those issues i know youre one of the ceos on the business round table responsible for heading up some of the business round tables response to this what do you do as a business round table member, what do you do at gm specifically . Well, at gm specifically we have announced were forming an inclusion Advisory Board and im really excited in the next week if not sooner well be sharing the membership of that, and we ourselves are starting off by listening ive been in two listening sessions, really understanding how our africanamerican employees feel, what they are facing, some of the challenges and thats going to form how we move forward there are things we can do across the board in terms of our corporate giving, marketing, communications, talent development, our hiring. Were looking very holistically inside of General Motors in how we advance much more quickly to create a truly inclusive environment where everybody can bring their true self and be their true self. If you can be yourself youll be happier and at your best so the response has been very positive we know we have a lot of work to do this wont be an overnight but were looking to make measurable progress we can look back in one year, two year, three year and we want to hold ourselves accountable that well see Real Progress as it relates to b. R. T. Im very encouraged by the fact that, again, so many b. R. T. Companies are very supportive and i think when you take the strength of the b. R. T. Working together to look at some of the fundamental issues, whether its from a legislative front, whether its from sharing best practices, and drive change i think that will help move the nation forward as well mary, are there specific goals that you think you might hold yourself and gm accountable to i ask that only because we hear from Tech Companies several years ago about how they were going to start telling us the numbers of diversity in their staffs, and it didnt seem to make much difference i know it can be difficult to find qualified employees to go into these positions, but without saying okay here are the levels that we want to reach, here are the levels i want to reach, you wonder if change will be different this time, if progress will happen well, i think representation and opportunity is one aspect, but i think it really gets at is how do you create the right culture . One of the thing at General Motors we made incredible progress on is creating a true Safety Culture, and we started in earnest in the 16 time frame and i can look now and our numbers reflect fewer incidents across the board and it wasnt it was a lot of things that we needed to do but one of the most important thing was changing the culture where people knew we wanted people to behave safely. I think when you look at inclusion, creating, having the dialogue, having people understand each other, value each other, listen to each other and put themselves in someone elses shoes i think we got create that type of change from a cultural perspective along with, you know, representation, hiring, development, and programs across the board. But when i think well be more successful is when we really changed the way people feel daytoday as they go about their work is this something youre focusing more on at headquarters, more at the plants as i visited the plant its a conversation we had with every single plant, with our joint leadership team, with employees across all aspects so this is something, you know, for the company, because its about our culture and its about how we treat each other, how we value each other and how we interact its something every where and its global. Mary, i want to switch gears again and talk about lordstown, ohio with the closure of the plant there ohio officials suggested they may try to claw black 60 million in tax incentives that they provided to gm. Do you have any idea how this might work out well, when we look at the difficult decision we had to make when we saw that small cars were not selling, that was something that a decision we didnt like making but it was important because customers were not interested in those vehicles any longer but were very proud of the fact that we have invested and going not only investing in our locations in ohio acrossthe board but specifically in lordstown is where were putting our battery Cell Manufacturing plant with our joint venture with lg and so i think that type of investment in the future of where we see the auto try going i think will be very important for that community so any time you have to make these type of transformation its hard but proud of the investment we made to support the ordstown community lets talk a little bit about esg, environmental social and governance transparency. Yesterday gm was ranked number eight on a list of 100 best corporate citizens up from number 24 last year. What kind of changes have you made at gm and what made you get to that point and moved you up the list you know, this is something weve been working on for wears now. Just last year we did name a chief Sustainability Officer and create a Sustainability Office we moved up our targets. We said we would be running on all Renewable Energy by 2050 we put plans in place to pull that back 2040 for the u. S. By 2030 we made a strong commitment to electric vehicles and in early march right before the covid19 strongly impacted the United States, we had an eb day where we shared our battery platform, our ells, platform strategy an number much vehicles we planned to launch in not too distant future also the work were doing from an infrastructure perspective. I think from an environmental perspective theres a lot of effort also we continually have been working on our culture i mentioned safety and theres a lot of research to indicate that when you have a true Safety Culture it leads to more inclusion, happier empowered employees and also Better Business results weve been working on our culture from a perspective of safety, from inclusion you know, were really building and accelerating the work that we have been doing and then governance of the company we already had a lot of recognition of the work weve done to have very strong Governance Principles and how we operate. So i think its the continued progress were making on all aspects of esg that afforded us this recognition and we have more work to do and well stay on that path mary, i want to thank you fork with us today we really appreciate your time we wish you good luck as those plants get back up and running to full capacity we do appreciate your time today. Thanks so much and i hope everyone stays well. Okay the too. Take care, mary. Meantime target announcing it is permanently raising its starting wage in the United States to 15 an hour. The retailer is giving a 200 bonus to front line store and Distribution Center team members as a thank you for their work during the coronavirus pandemic. Target set a goal for 15 an hour in 2020 three years ago with this announcement and bonus and previously announced bonuses paid out earlier this spring target will have invested extra billion dollars this year in terms of wages, paid leave, lhases and ppe for workers. Wel ve more coming up in a little bit squawk box will be right back. Thats been through multiple market cycles for over 85 years . With capital group, i can. Talk to your financial professional or consultant for investment risks and information. Try natures bounty sleep3, professional or consultant a unique trilayer supplement that calms you, helps you fall asleep faster and stay asleep longer great sleep comes naturally with sleep3. Only from natures bounty. Can i find an Investment Firm with a truly longterm view thats been through multiple market cycles for over 85 years . With capital group, i can. Talk to your financial professional or consultant for investment risks and information. Talk to your financial professional or consultant bbut what if you couldg do better than that . Like adapt. Discover. Deliver, in new ways, to new customers. What if you could come back stronger . Faster. Better. At comcast business, we want to help you not just bounce back, but bounce forward. And now, with one of our best offers ever, were committed to helping you do just that. Get a powerful and reliable internet and voice solution for only 29. 95 a month for three months. Call or go online today. Welcome back to squawk box this morning some news right now on tech giants wall street journal reporting that the Justice Department is set to pose limiting internet firms protection this follows President Trumps executive order which seems to weaken broad immunity that facebook and twitter have enjoyed. It need to be adopted by Congress Administration official says the goal is to force tech does more consistent in decisions to take down content found to be objectionable. So well see what that debate looks like in washington joe . Thanks, andrew stocks rose on tuesday along with market sentiment. Our next guest says were finally giving investors, the market is anyway, what theyve krae craved for years chris, youre saying that what youre seeing in this rebound in terms of broadening out is more than just rotation but actually some very positive technical sign that this advance has further to go . Thats right, joe we think this word rotation is misleading not money moving from one corner of the market to the next. This is new money coming in and reflected in the new high data last week you had almost two third of the s p make a three month high one of the best readings weve seen in history. Ate sign that investors are finally getting what they craved weve talked for two or three years how narrow this market has been, primarily led by big tech. That has really started to change here. When you the start to see the new high data expand like think think ate reflex of money actually coming in, participation broadening out and when you look at this historically the only other times in history where youve seen the new high data surge like this is coming off the 1974 market, low coming off the 82 low and coming off the 2009 low. We look at this as a very positive long term event so, what youre seeing, you mentioned three month highs. And the number of stocks hitting three months high, best reading in 40 years and thats historically very bullish. When you have such a sharp down draft it just doesnt seem like getting to, you know, depending on how you space the three months, you would assume that a lot of stocks have rebounded from their highest levels following when the pandemic got bad. But it doesnt matter if youre looking at it that way, what matters is that youre actually seeing it happen he joe, it really doesnt matter thats when you have historically seen this data really start to fire in the days and weeks and months coming off some of those major market bottoms. We would expect or want to see this coming off some of those major loss i know it brings in this other debate of whether or not the market is getting too frothy here or whether or not they stories about Retail Investors getting involved when we look at our data and you look at the flow data, believe it or not flows into bonds over the last three months have dwarfed floss into stocks. On one hand you have this really positive momentum signal with new highs expanding and on the other hand we just dont see the signs of froth and euphoria from the flow data that would get us uncomfortable. With all of this you would expect people to say it is getting frothy but youre saying that retail is still youre not seeing the kind of frothy flows you see it tops at this point, youre looking at flows in the etfs. Not even the same ballpark. Since the mark low theres been about 70 billion going into bonds, 13 billion into stocks thats a strong cry for us when you look around different corner of the market here, you know, what were looking for is what is ground zero for the risk on risk off trade. We talk about banks Getting Better here as bond yields have affirmed something we watch closely if banks start to outperform here and i think thats another change in favor of the risk on tone hat the market has shown us so, at this point i have seen people say were going to see a move in the utilities and more defensive plays as it becomes clear that the economy will not be a v a nike switch or Something Like that. You run counter to that. You think going into cyclicals or banks or Something Like that. Not defensive . Thats the tone of the tape here i think the market has already voted. The market has shown us a vshape coming out of this and when you look at these subtle changes in leadership, its another example of what was ground zero on the way down starting to firm, a data set we look at is the sales expectation component of the nfib. That has surged over the last number of weeks which has historically been consistent with small cap to outperform these ground zero corner of the market whether its small caps or banks are actually sending a pretty positive long term tone about money moving into the cyclical corners of this market. We welcome that. What about the stuff weve seen with day trading, beaten down names, bankrupt companies where people are going in and they buy the stock and it goes up and they sell it even though the stock may be worth nothing, none of that is an indication to you youre starting to see this get to a point where speculation, you know, where its representative of the entire market . You know, i think were talking about such small amounts of that and i know its been magnified with all this attention placed on the retail trader and some of the movement youve seen in the Energy Stocks when you put this in the big picture, flows have been coming out of equities for the last three or four months positioning is still very defensive. Street is still running short as far as s p futures we look at that as not being aggressive as most might suspect it could be here chris, thank you. Bullish take from you. More to go well see you later. Thanks, chris. Andrew judge okay a lot more coming up another big hour of squawk straight ahead Glenn Hutchins will join us with his thoughts on the fed, the reopening and much more plus investor, mark cuban will join us with his thoughts and then well hear from Reed Hastings all coming up in just a little bit. 210 points higher. Nasdaq up 82 points. rrit ckft ts. Wee ghba aerhi try natures bounty sleep3, a unique trilayer supplement that calms you, helps you fall asleep faster and stay asleep longer great sleep comes naturally with sleep3. Only from natures bounty. Good morning futures pointing more gains ahead of the opening bell. Its been a wild ride but the dow got a three day winning streak going is the u. S. Getting reopening right . More people are getting back to normal but were also seeing record coronavirus case in some of the most popular states like florida and texas. Ahead well talk about whats working and what isnt the Dallas Mavericks owner mark cuban and an interview with Reed Hastings youll want to hear about his big announcement the final hour of squawk box begins right now. Good morning and welcome to squawk box here on c the nbc im joe kernen along with becky quick and Andrew Ross Sorkin u. S. Equity futures have been somewhere between i think we started early on in the morning. Up over 200. Then up 70 when the show started. Then up over 200 were up 134 points. Nasdaq indicated up 73 and the s p indicated up 15. Its been this has been like war and peace. You know, already this week. Yeah. Long crazy, the markets remember monday. No, i dont. Thursday down 1800 friday looked like it would go down more but eked out a gain. Monday of all right. Monday was up tuesday looked like it would be bad and resumed, we were down 700 points and it turned all the way. Anyway we had a couple of big turn arounds on monday and tuesday already. Yesterday it looked like we would be up 700 or 800 and ended up 500 we havent gotten back the 1800 points yet from last thursday but that would put us back to 3232 on the s p which is within a stones throw s p is like a 8 all time high nasdaq has been up like seven out of eight even only that one day did the nasdaqed go down last week wasnt great monday, tuesday and wednesday either but it really picked up on thursday. A show that never end that weve been watching. I noticed this week the alarm clock goes off and its very early and i try to figure out it just seems like its like a nap. Its like little interruptions there of one long period of being awake. Let see, is it thursday or wednesday . Okay but its really kind of weird. I dont know if thats being shut in i dont know what it is it seems different than normal its being shut in. It seems different. I try only to have cocktails on weekends. So weeks are much longer how is that working for you its working. Not pleasant but you got to do what you got to do. Yeah. We do have a big final hour of the show ahead for you this morning. First up well be speaking with north island chairman about Glenn Hutchins about the economy. Mark cuban will talk to us about reopening businesses around the country. Then well hear from netflix Reed Hastings who will have a few special guests with him as well first we want to get to Steve Liesman with some of the biggest investor takeaways all of this comes ahead of round two that comes to congress today. Steve, what can you tell us . Reporter i think, good morning, becky the big takeaway from yesterday is that powell the fed chairman is not moved by better than expected data or the idea of a faster rebound hes committing to maintaining a very easy policy even making it easier over time because of the uncertainty of the virus and the Economic Outlook and concern that there will be lasting damage to the economy and to workers. A large number of people will not be able to go immediately go back to work at their old job or even in their old industry there will be a Significant Group thats left over even, after we get the employment back i do think they will be hard pressed to find work and need support. They will have Unemployment Insurance but thats something i would be looking at is what kind of support well theyd. Reporter he urges congress to do more and suggests the fed is willing to do more. Pimco in a commentary this morning really summarized the view of themarket towards the Economic Outlook, the virus and fed policy they said we expect the risks of Monetary Policy and fiscal. To be ask youed to more easing even in better than expected economic scenarios. You can see the story by looking at our cnbc wrap it update which we updated after that massive arrest sales number and huge beat you can see how big a hole the economy has to dig out of. Okay theres the 5 decline thats the actual in the First Quarter. After the upgrade yesterday and ill give you some detail on that in a second, the average of the eight economists we used was down, still down 35 for the Second Quarter then this 22 rebound in the third. 16 in the fourth. Put it all together and the full year is still down more than 5 , even with those two big rebounds i think thats whats animating j. Powell and the Federal Reserve here just one more thing i want to show you which is rather incredible this is the barclays commentary from yesterday may retail sales rebound more than expected. U. S. Gdp tracking revised higher to minus 39. Why . Because they were minus 48 its like saying it got warmer when we went from minus 48 degrees to my new 39 degrees not a whole lot warmer, still very cold. Just real quickly, guys, no real push back. A little bit on the idea of exit strategy, on the idea of is the fed going too far and i think in that context the fed chairman feels hes got a green light to go ahead with these very easy policies, despite the better than expected rebound in some of the Economic Data and the really strong stock market. Joe . All right, steve. Thanks becky . Thanks, joe joining us right now to talk more about the economy and the feds most recent actions is Glenn Hutchins hes the chairman of north island he wears a number of other hats including being on the board of directors of the new york fed. Glenn, lets Start Talking about just what steve mentioned about the fed, where you think were head all the way back on may 13th you told us we were in unchartered territory when it came to the fed. What do you make of the additional thing we heard this week good morning. How is everybody doing i hopewell becky, i want to make a point for mark cuban before we get started. I want to point out to mark, becky youre wearing your celtics green this morning so i think thats a subtle message to my friend mark. On the economy, david wessel often says when the economy has gone the outlook on the economy has gone from critical to stable, which is good but were still in the icu, which is bad and thats essentially what Steve Liesman was just summarizing j. Powell said yesterday. I think thats important to under. We need to recognize some good things are happening, which is great but we need found were still way below where we need be to recover and as a consequence of which i think that we probably i think youll recognize jason furman said it this morning is that a lot of what happened in terms of improvement of the economy particularly around retail spending and jobs which is two good numbers we had, which have been largely so far as a consequence of the policy actions that were taken around stimulus checks, ppp loans and Unemployment Insurance so the policy has worked and continues to work. I think that both that jason and jay made that we need to do more as this economy continues to falter in the absence of real slugs to the Health Care Crisis and as a consequence of that, slower return than we might desire the people to work and to consuming. We might well have to take more action those actions, i think are pretty well summarized in the report jason talked about this morning. Go ahead, becky. Glenn, i was just going say, its my guess and we talked about this earlier this morning, my geese youll see additional stimulus coming from the government and in the big way. Democrats would like to spend more and i dont think youll have this administration, President Trump saying forget it were taking money away from you three months ahead of an athletics. Yes i dont think it should be a partisan issue demonstrate want to do it and republicans are worried about the election we need to support the economy to the point where we can hand off to the private sector. I think that were now in the very early stages of the middle distance of this crisis in which we have the slow return over the course lets call it 12 to 18 months to a normalized economy and youll remember at the end of the great financial crisis, we had the sequester we tightened fiscal policy prematurely. We need to avoid that mistake this time and continue, to i think, stimulate intelligently recognizing this notion that the Unemployment Insurance boost that we gave them 600 is having some degree of disincentive for people to work and maintaining that but reducing it and targeting it so it doesnt understanding we have to maintain it. Carefully designed policies we need to think about. You are talking about making sure you also incentivize people who go back to work and maybe offer them practice. That too. That too in other words, you got we shocked the economy with 600 extra of Unemployment Insurance, that worked. But that was a blunt tool of the type that could be deployed very quickly. Now carefully designing the next wave of this to incentivize people to go back to work and help people who cant get back to work. Theres a number of people who can get back to work as restaurants reopen. Some people cant get back to work because hotels and cruise ships arent opening and we need to target assistance to people who need it. I think there is general agreement that something needs to be done do you think that there will be enough agreement on what needs to be done and how much do you think were talking about . Another trillion dollars, 2 trillion, 3 trillion. What will the final tap look like i think congress has, as you suggested earlier there are incentives for everybody to act. One of the good thing thats happened in this episode while theres still a fair amount of political theater which is because of the upcoming election, congress has acted quickly, acted almost unanimously and what theyve done is effective. Im confident they can do it again. I would do it in phases as you watched the economy improve. Or the plan that jason furman talked about earlier today where you have one set of legislation but you have automatic phase ins based on how unemployment operates i would have something that tapers so you can reduce the assistance of the economy as the economy improves one thing thats very interesting is that if you look at the fed programs, theyve actually havent had quite as much take up as you would expect because simply the fact that they were there as backstops has caused the markets to get back to some particularly the credit market to get to some type of regular operation and be able to fund the companies themselves so we havent even had the main Street Program operating yet but the credit markets are in pretty good shape already and so i think thats an example of having policies in place so that people in the markets and people in the employment sphere can understand that they got that kind of support. Then that creates the conditions of confidence that powell was talking about under which people can get going again. Having these programs in place is as important in many cases as actually implementing them glenn, were out of time. We do have to run. Very quickly, youre also on the board of new york presbyterian weve seen the number of cases in new york and new jersey come down thats a great sign. Are you hopeful that will continue as the economy reopens in those states the issue right now, by the way, is you got you were alluding to florida and texas, states that have not been as careful with the social distancing and the other lock down measures havent taken this pandemic as seriously are now seeing significant increases in contagion which was predicted. Im confident that in new york be a sent a recurrence in the fall that we under how to deal with this thing and the Hospital System can cope with it. Theres lots of ongoing implications, lots of people who are severely sick who are in rehab. But im confident we have that in hand and we know how to deal with it. Im concerned about other parts of the country where they are now experiencing their pandemic and are not as careful as weve been in new york by the way, becky great to say. Someone go buy joe a drink. Youre not on that plan of only drinking on weekends. Joe, next time i see you drinks are on me okay. I have not been not drinking for the last three months i can tell you that. The reason why im here i am now is because the wine was looking like, sort of like a therapeutic every night. Its sugary and then it lead to eating goldfish crackers along with the wine. My kids call me thats too much information tmi. People tell me jokes, people are going to bartenders saying is there alcohol in this anyway this is tmi im not alone in being a little bit not a whole lot to do around 6 00. Andrew do you have cocktails at home during the week can you cop to that or is that too much tmi you know me, i drink bubbly as you know and im like a water guy. But there are other people in my house that are drinking all sorts of different yes. Theres alcohol in the house im not drinking it. The kids . No. The staff im sure they need a cocktail once in a while dealing anyway im sorry i got that started. I apologize. Becky, youve had a couple of glasses of wine during the week . Once in a while, sure all right im the only one that admits these things never in the morning im sober have you ever im a coffee guy. Coffee and okkah lunch a. Ill show you my wine cabinet. Its full. Mine is empty thanks, glenn thank you when we come back, beyond meants aggressive play for market share ahead of jewel 4th holiday cookout. The company is trying to get the jump on plant meat there are times when our need to connect really matters. To keep customers and employees in the know. To keep business moving. Comcast business is prepared for times like these. Powered by the nations largest gigspeed network. To help give you the speed, reliability, and security you need. Tools to manage your business from any device, anywhere. And a team of experts here for you 24 7. Weve always believed in the power of working together. Thats why, when every connection counts. You can count on us. Welcome back to squawk plus Justice Department and big Tech Companies need to be taking note reporter the wall street journal is reporting that the department of justice is preparing proposed legislation that would remove the Liability Protection that Tech Companies have on their platforms if they are facilitating or soliciting contend that violates the law, that includes online scams, trafficking illicit drugs. Also remove their liability shield if they are involved in sexual abuse, terrorism or cyber stalking and this is really sort of the culmination of an effort that attorney general barr began earlier this year during a forum on Child Exploitation. He talked about the concerns he had that essentially the department was unable to go after bad guys on these platforms and that they were essentially giving over their ability to protect americans to profit seeking firms he said some of these firms are purposely blinding themselves to illegal conduct on their service and that the department of justice will be taking steps in order to try curtail that. Now its important to note that, obviously, theJustice Department cannot unilaterally do this. This is something that would require approval from congress and the republicans in congress have proposed some similar ideas. Its likely he could get some backing from someone like senator Lindsey Graham or Marsha Blackburn who have expressed concerns about content on these latino forms particularly from the Child Exploitation angle what were seeing here the department of justice ramping up the fight against big tech and raising this in a framework of a National Security or Law Enforcement concern whereas the white house had previously brought up these issues as potentially biassed, conservative bias against conservatives. They are now putting this in a different framework and might get more traction on capitol hill before you go, let me can you this, though, because it raises some questions how republicans are looking at this and how democrats are looking at this. The end results of this approach, i would imagine, would mean effect liverly more cureffg of everything. It means they would take a lot more stuff down and not let a lot of material up at all, correct . Reporter it could go either way. There are arguments that one way for these platforms to avoid any type of questions about whether they should be liable or not is simply to leave everything up and go the other route and actually create more of the types of bad content that lawmakers are trying to get rid of on the other hand, they can go to the other extreme by removing lots of content and then that could also be a question about are they stifling free speech. Platforms serve a purpose that their users are turning to them for. I think that the thing that makes this different is, again, going at this from that Law Enforcement Child Exploitation angle. Previously theres been bipartisan support for Liability Protection for things like sex traffic. Theres precedent for this happening and tech wants to be concerned. All right ylan, thank you so much for bringing this news to us meantime we need to change gears and talk a little bit about Consumer Buying Habits reporter good morning, andrew beyond just announcing its lujing a limited Edition Value pack called the cookout classic. You can find it at walmart and target starting next monday or through august it comes with ten fwrozen foodies for 15. 99. That comes out to about 6. 40 per pound. Compare that to a traditional fresh beef patty which the usda say its about 5. 26 a pound theres only about a 20 price gap between the two. Beyond has been trying to narrow that gap why . Well the company is going after traditional meat customers at Grocery Stores and what better time given all the problems that the meatpacking industry with pandemic related shortages, rising prices and a recall over the weekend. Some of those meat packers are trying to take shares away from beyond and, of course, impossible foods, those products are moving the dial the latest nielsen data showing fresh Meat Alternatives was one of the top growing sectors up 132 since march alone. Joe, back to you okay, thank you very much. Beyond meat. Wow. Thats going to be big, i think with everything thats happening. Coming up you dont want to miss an interview, andrews interview with Reed Hastings he has an important announcement to share at 8 45 eastern and hell be joined by some very special guests stay tuned youre watching squawk box on cnbc between ideas and inspiration, trauma and treatment. Gained a couple of more pounds. Thats good for the babies. Between the moments that make us who we are, and keeping them safe, private and secure, theres webex. Beautiful. Can i find an Investment Firm with a truly longterm view thats been through multiple market cycles for over 85 years . With capital group, i can. Talk to your financial professional or consultant for investment risks and information. Still to come this morning critical breaking data from the housing sector could Home Builders meet returning demand in may. Stay tuned youre watching squawk box on cnbc [cymbals clanging]. [knocking] room for seven. And much, much more. The firstever glb. Get 0 apr financing up to 36 months on most models, and 90day firstpayment deferral on any model. Welcome back to squawk box breaking news. Our may read on Housing Starts and permits were expecting a number around 1. 1 million on starts and got 974,000, seasonally adjusted annualized units follow an 891 that may be revised in a few minutes 974 doesnt do much for us considering that march we were up at 1. 27 million if we look at permits what may lie ahead 1. 22 million seasonally adjusted annualized units. Thats close to expectations and a big jump over our last look which was slightly modified assistant at 1. 066 1. 066 now 1. 022, number since march and revision on starts i thought we would from 891,000, actually up to 934,000 so we definitely improved a bit. That means that this months starts up a little over 4 and permits were up a bit over 14 so once again another data point where were leaving the worse levels in the rear view mirror all about retail of change this improvement, of course, is a good sign with respect to housing. We know Interest Rates are low maybe the biggest question out there is who will want to live in some of these really big cities that experiencea lot of c crisis the Housing Market looks like its getting more optimistic month to month becky, back to you rick, good question rick, thank you. Well talk to you again very soon diana oleck here and has more insight into those numbers and what she sees too. Reporter good morning. Im looking specifically at the Single Family market because thats where we were looking for the most growth, where we have a very short supply of existing homes for sale and talking to a lot of Home Builders who said theyve seen extraordinary demand in may. Could they ramp up the starts. The answer of not really you only saw a. 1 monthly move in the Single Family Housing Construction still down 18 yearoveryear in starts permits as rick said are much better why were builders not able the ramp up . A couple of things land they stopped buying land in march and april. They wanted to stay land light in order to keep their Balance Sheets healthy during the pandemic which they thought demand would fall off for much longer we heard Stewart Miller yesterday saying they shut down the land purchases and then had to ramp thad up in april and may when they saw that demand come back didnt have the land or labor as they had to layoff this of workers in march and april bringing them back online in may was difficult. Then, of course, you have to look at the materials. Was that material flow coming into the builders the way they needed it. I want seems the from the number they were not able to get up to speed. Im looking at the permits thinking it would be better in june with so much demand out there they werent able to ramp up the construction more quickly. Hopefully in the next couple of months as we do see demand Going Forward. Again, disappointment on the starts much better on the permits back to you. Diana, thanks the countrys he reopening process is Going Forward even as coronavirus cases have speck in states scattered around the country. The latest Research States of play survey measures attitudes among likely voters in returning to normal activities 50 of respondents feel its safe to go into their office 40 feel comfortable dining in at a restaurant. 28 said they are comfortable taking a flight. Drilling down to the state level, texas is seeing a continued increase in covid19 case with hospitalizations hit agnew high up 66 since memorial day. Joining us now to talk about the reopening process in the texas and nationwide, pro sports and equality in american is mark cuban, entrepreneur, philanthropist and owner of the nbas Dallas Mavericks mark, we want to talk about all the different sports openings. Lets start with the nba i dont know what well do with mlb. We did see a golf match and got another one starting tomorrow. I have justin rose this time and for every stroke underpar i get 2 so i might make up the 25 youre killing it, joe. Anyway, he played well last week what do we need to do for nba to make coaches and players and fans and everybody else comfortable and are we going to be able to pull this off, mark i think we can pull it off. Obviously safety is the most important thing. I think we have a good program in place well work closely with disney and facilities at disneyworld will be optimized to keep everybody safe were taking the the Hotel California approach. Once you enter you dont leave until your eliminated. We have very succinct programs for testing. After watching everything thats happened in the different states, mark, and you know texas pretty well, i would imagine where do you stand on the way texas has handled this versus the way a state that has not reopened at all is handling it or georgia versus some of these other states its a great question, joe. Very difficult situation you know, we had a care here in our household. A bunch of graduation parties. My 16yearold daughter attended a bunch of kids got sick and tested positive. Everybody had to go get tested weve seen eight deaths last night in dallas alone. The number of hospitalizations are increasing to answer your question i wasnt opposed to opening up but i was kind of i wasnt happy with the fact that there wasnt a lot of management of peoples expectations in other words, people, when we went out and drove around there were people without matchings as if nothing had ever happened and nobody there saying this could lead to problems so i think if were going stay open were really going to have to take some steps to make sure that businesses enforce the requirements for masks, et cetera you have that personal experience down in texas but youre also trying to figure out, you know, what to do with the mavs, but then should have shark tank and all the businesses that you invested in, and you more than anyone else knows, you know, these are great people that have the nerve to start a business and the enthusiasm and just, you know, to run into this buzz saw its tough. We want to try, if we can open safely thats an important part of the whole calculus on, you know, its not as important nothing is more important than health but its hard to stay healthy if you cant pay the rent, cant put food on the table. To deal with those Small Businesses, the shark tank businesses, i told them you have to innovate. Weve seen a transition to online buying and selling and thats what the best of my Shark Tank Companies have done retail sales are up, online sales were up 31 . So you know that people are making those purchases there and so you really have to be adaptive the challenge has been for retail, right because you want those stores to get open and open safely. Same with restaurants. Were kind of in, kind of a weird environment right now because theres so much stimulus and so we dont know what the organic demand is right now. Trying to find that balance between staying open, you know, keeping people healthy, and actually making money doing that is going to be difficult right now until we get past july 31st when the enhanced Unemployment Benefits run out mark, i know youve been on other Media Outlets and other places you must have responded to this many, many times, but in looking for ways to change what needs to be changed in this country in terms of the way the systemic racism we see with maybe with police force, that we have no idea about, i dont think. And just the inequality issue in many neighborhoods and hopelessness in. Many urban areas what do you think . Where does the answer lie after thinking about it like all of us have for so long i dont know if i that have answer to be brutally honest, white people got have difficult conversations. Right now when we hear the term White Privilege we all react negatively were not used to talking about race we dont really understand we get very defensive when people use the term White Privilege. We have to recognize racism comes from us and that, you know, dealing with it means that you and i and anybody who looks like us, when we see racism, when we see people acting inappropriately, when we see businesses doing things the wrong way and not treating minorities as they should be treated then we need to say something. We need to speak up. As an entrepreneur, as a business guy what i see is a generational opportunity for this country to move forward and so now is the time to do it. Is it hard yes. Is it painful . Yes. But, you know, were the ones. White people dont like to talk about race it makes me uncomfortable saying the term white people because we associate it with so many negative things. Thats what we have to do. When we hear the term White Privilege babe its not the best term, maybe it makes us uncomfortable but the fact that it makes us uncomfortable gives us reason to really want to start taking steps forward so, going into some of the areas where this is the separate issue, where we know its just so, seems so hopeless for the kids that are growing up there in terms of education, in term of the surrounding, we do have something as a model in harlem very expansive and takes a lot of i mean they start with kids when they are born and goes all the way to when the kid gates job and they watch what they do after cool and they watch, you know, what they are involved with and the clean up programs are great. How do we go its not just education because they get out of school, kids do and go to a place that may not be great. Joe, none of these things are mutually exclusive we need to have programs that help people. Anybody who is disadvantaged we need to help people. We need to step it up or do it differently or do something with the schools or home life. Its something, yes, but at the same time ill go back to what i was saying earlier. We as white people know people who are racists. Maybe not overtly but subtly racists and when we see people act that way we have to step in and say something. Thats when things start to change when we see these numbers come out. We see the numbers on the Police Department we hear the stories about africanamerican men and their interactions with police authors systemic issues. Those dont just people the talk about race youre not born with hatred towards other races youre taught it the people we know that are teaching those things those are the people we need to talk to. Thats what will lead to systemic change. It may be one little baby step at a time that each one of us can take but in an aggregate thats where real change occurs. All right well continue to have these discussions. Thanks for asking the question, joe. Its a tough question, tough answers. But, i dont know. Well keep plugging away hopefully we will andrew . Coming up right here on squawk box, when we return, a lot more coming up netflixs ceo reed lastings with a special announcement and some very special guests. Stick around for that conversation in the meantime check out our shares of boeing ceo saying he has informed boeing that they wont require any more 737 max aircraft and replace those orders with other aircraft that stock autbo 2 down youre watching squawk box on cnbc we get to the cnbc headquarters jim cramer is standing by. Jim i was watching you last night on mad money thats what i do i watch you the entire time. Youre my buddy. I saw you get downtown the floor. Before that i heard what you were saying about how the fed spending money, the government will spend money, you cant fight the fed. And thats really whats happening in the market once again today, right sure. I mean i think when you see j. Powell talking about buying Corporate Bonds and you think here it goes down, here goes norwegian again, royal, american, all those companies can issue even more bonds and the fed will be there to back them up. The fed doesnt want any layoffs. Fed knows there will laboroffs for companies too small, restaurant companies, retailers but they dont want any big layoffs. Think about it hertz. Government is concerned. I bet the hertz paper. It is remarkable they dont want publicly traded companies to be the reason why we have more unemployment. And i think its a creative effort i feel theres a lot of Small Businesses where you just have like list enning to mark cuban, if theres congregation then people get in trouble and they get sick and thats what happens when you have Small Businesses that have small spaces where people congregate. Its a battle well be watching for quite some time yes ill keep watching you. Coming up in a few minutes then ill see you tonight thank you very much thanks, jim. See you in just a little bit andrew thanks, becky netflix ceo Reed Hastings making a big announcement thats taking place this morning he and his wife are donating 120 million to three institutions dedicated to the high engineer education of color. Ucmf, atlanta based liberal arts college and moorehouse they will each receive 40 million. I spoke with hastings and the three leaders of those institution by zoom yesterday. I started out by asking hastings about how all of this came about. Dr. Lomax in a are on a board toefg Public Schools 100,000 kids, latino and black kids in america who get a great education and go on the college. And through that time he helped me realize that theres many good places to donate, but the hbcus in america are 150 years old. Incredibly resilient producing amazing numbers of black graduates. And that i should be open to think about those schools also and got me to come down and visit spellman and morehouse and patty, my wife and i were blown away not by these great president s on this call, they are very nice but by the students and what it meant for them to be just surrounded by so many black scholars and how reinforcing it was. So were stepping up with this 120 million gift. You know we want to help bring attention to the hcbus to them being a part of the solution for america and for black children to aspire to and so were so proud. But really the credit is with dr. Lomax. Can you speak briefly as to this moment in terms of the impetus . You know, this moment is not the first time that racism has reared its terribly ugly head. And many of us have been working on these issues for a longtime again, for me mostly through education and my visits and my oning, my relationships with all our colleagues here was all pre this crisis. You bring in covid, the stress, the typical black family knows many more covid victims than the typical white family because covid has hit so hard in the black community. Then, of course, you that have police violence, the killings, and so the amount of tragedy really did get us to focus and say lets do something now that will be supportive of they great institutions and give people some sense of hope you have a lot of colleagues who had a lot of success and im thinking of people like mayor bloomberg who gave 1. 8 billion to johns million to Johns Hopkins and a lot of other successful people with remarkable career who is have given to a lot of the Ivy League Schools and others what do you tell them . Have you had conversations with them about this and this potential opportunity . You know, we all tend to give to the institutions that we know and love and you know, when i started, i had been mostly donated to a wonderful college that i went to, bowden college, in maine it was really the work of Michael Lomax and helping me get to know the hbu system that opened it up to me i think we start with the idea that if you want to give a gift to your alma mater do that also give one to the hbcu. The easy way to start is with uncf it is broad, sort of united way of the system. Then you can get to know the individual institutions. Giving both to your own alma mater and giving to the hbcu is a great way to go. Than to call i asked College President s about the impact of this gift . The gift that patty and reed have made is really transformational you talk about the endowment its not just that we dont have the same resources its that we have taken on the responsibility of educating more of our students who are without Financial Resources themselves 60 of moorhouses students are eligible for help. 48 of spelman that means that virtually half of our populations come from families that make 40,000 or less. So here you have, in this country, you have the colleges with the least resources taking on the responsibility of educating at a high level the students who need resources most and so having patty and reed make this contribution is especially important because spent a lifetime thinking about and committing and investing in eliminating educational inconnect. We have many alumni who have done quite well but i dont think we have any billionaires and so what robert smith did last year, what patty and reed are doing now allows us to transformat an accelerated rate of speed and the reality is that we have to do more and do it faster to get to a better place, to continue to get the best students who have opportunities to go other places in some cases, no choice because they dont have family who have extra resources to give them and our ability to continue to attract those students makes us each more attractive to those students who have resources to pay. The nearterm focus this fund is the reopening of our black colleges with strong enrollments, Safe Environments for our students, and Great Technology and inperson teaching but the long term goal is full recovery and transformation. Netflix have been has been one of the beneficiaries this pandemic shows are up more than 30 year to date. The company now valued at about 19 billion i asked the ceo reed hayesings about the role of Corporate Leaders in this opportunity and how he feels about trying trying address some of the opportunity gaps in Silicon Valley and in his own company. Mostly we have a long way to go in the u. S. Black people are about 13, 14 of the population. We significantly underskew some of that because we are in california but we are working on all aspects of it. It is a lot of the dock networks that people have of how do you get in and we forget how much the social glue we have relative social isolation between the large black community and white communities, you know, on the marge there is connectivity and thats great so those are some of the factors that we are looking to overcome and to continue to increase, both our representation and our inclusion to trying to be a blackfriendly organization. It is amazing how easy it is to have even a company thats hard like netflix not be that comfortable for black employees at times it is something that we all have to work on our black employees work on it hard ask the rest of us work on it also you know, guys, this donation, i think more than even the money, and an effort effectively to try to get frankly so many of our viewers we could run a telethon for so many of the historically black colleges and universities in this country when you think about endowments, harvard has 40 billion. You look at some of the other ivies, 30 billion, my 20 billion. When you look at the hbcus endowments in this country, they top out in the hundreds of millions of dollars. So the opportunities, when you really think about the education gap and all the things, and jobs that we need, i think what they are trying to do is really interesting and important endeavor and im glad im glad that we could have that conversation this morning and it would be great to have more conversations like it in the future with other potential donors. Split it up you know, if you go to your alma mater all the people we deal with not me, but all the people we deal with went to these Ivy League Schools with all of these huge endowments why give money to them split it up. If you need to, you need to, but that was a great idea, i think from reed, split it up split it up. Dont give any to the ivy league no, no give it to them. But they are doing fine. There is no doubt. They are doing just fine. I think thats the point hes trying make. But a great thing to see happen. All right so no money to big red for you, right . No money well, you know what actually i am involved in something right now, but it is actually to africanamerican journalis at cornell hopefully we are going to do that soon. So there are things to be done things to be done. Thats cool you sound surprised. It is cool. It is. Thats a big move to get involved in trying to pick these things up. Even at cornell coming up, we will get you ready for the trading day ahead. The futures up not triple delegates him in, up about 78. Stay tuned you are watching quauks on cnbc cnbc. So im gonna hold on promoting you this quarter. Cool . Drop the taco. Get in the car. Does this sentra feel like a compromise to you . Wait, what. . The handling is good, right . No compromise there. Nope watch this. Umm. Bbrie. Brie brie rear automatic braking. So if this Nissan Sentra isnt gonna compromise, why should you . Youre right atta girl. The allnew Nissan Sentra. With more standard safety features than any other car in its class. I cannot oh, i was going to say i cant guarantee a triple digit gain handing it over to squawk on the street. It is up in the air right now. It has been another good show. Thank you becky, thank you andrew make sure to join us tomorrow. You are welcome. Skesquawk on the street. Up 97. Squawk on the street is next and here we are im david faber along with jim cramer Carl Quintanilla has the morning off. This is squawk on the street. Welcome to all of our viewers as we get you ready for a open half an hour from now loongs like stocks are going to continue resurgence after last weeks weakness for al