Carl jon, that was one of your better dad jokes morning, guys. Good to see you both weve talked so far this morning about production in manufacturing, talked about infrastructure this hour, obviously, youve got to ask the question whether or not we will one day be talking about vietnam as a true high tech hub its true that apple has components made here sharpe, intel, lenovo has component make heerg fing here a while. Was its that final assembly that is so hard to do and requires so much education that vocational schools like this one are in huge demand here. The government has vowed to train 2 million kids over the next several years we talked to one of the professors about this training, and he said, because the students who do graduate are getting snapped up like mad. One of those companies is samsung, guys. Thats one of the big stories here in vietnam. They came here a while ago back in 2014, invested 3 billion in an industrial park, 250 acres, 60,000 employees, which is now one of the biggest facilities to make cell phones anywhere on the planet but the question will be whether or not, guys, that is the exception rather than the norm, because although you do see, for example, these reports and rumors about, well, would apple one day move some of its productions out of china, out of foxcon into other countries, certainly possible but the work that vietnam and other countries would have to do to get there, to meet that demand is still a long ways away carl, just great work, great content all day today. Just really fascinating information. Im wondering about another piece of the trade puzzle here and supply chain puzzle, which is logistics and transportation. What it would take if more manufacturers are coming into vietnam to actually move those products to other parts of the world. Reporter i thought of you today, morgan, because we did go to the port and saw all of those containers and realized what a big deal it is to have a port that is a deepwater port, where you dont have to get your goods to another market to get on a bigger ship, to get to the United States. So the deepwater port is what vietnam has been working on. But again, thats a huge challenge. Its something they havent had to do so far and to get those things up and running is going to take about three years. So is this whole boom going to last throughout that time . What if we get a g20 deal this weekend or some time in the next six months what happens to all of those investments and those ideas then so, its really vietnam is in a really interesting crossroads whether its the production or the delivery, which, of course, you know so much about and thats the question that i have, carl, is around stability, because we didnt do tpp. And because nobody knows exactly how long this trade war with china will last. How reliant does that make vietnam on Getting Better trade agreements with anybody, who could then serve to fill that demand hole that could emerge, if things clear up between the u. S. And china yeah, i mean, believe me. The lesson at tpp is not lost on anybody here and in fact, just in the past couple of weeks, theyre making final arrangements to get a Free Trade Agreement here with the eu which is something that doesnt look, you know, likely in the near term with a bunch of other countries. So vietnam, i think, is overall playing it very safe theres a look at what they already ship a lot of machinery, a lot of apparel, a lot of footwear but there is sort of this dichotomy, guys, between the stuff thats easy to make, the tshirts, the sneakers, even, as opposed to the cell phones and final Assembly HighTech Products that are much harder to build. That said, i will argue one last thing. Theyre very big in auto parts if you need brake cables, the emergency exit signs that you see in a Movie Theater and schools, those are all made here but to get to the level of a of what china has been able to put together over the past 20 years, thats where they are theyre very much they have that in their sights, but they realize what its going to take to get there all right, carl, thanks, were going to get more from you, of course, later on this hour and so the question, will Companies Need to reshape their sourcing to respond to these trade headwinds . Joining us now, citis u. S. Hardware analyst, jim suva, who most recently slapped his apple target price on chinas and the economists editor in chief. Jim, theres been talk about apple making some adjustments in its supply chain to supply the u. S. How permanent do you see that being . And how much flexibility do you sense they really have well, first of all, they set up a great production coming and sourcing out of china. But with the evolution and the time of iphone growth as well as its apple user growth, beyond simply just north america, other countries have certain rules that are quite unique that people arent familiar with. For example, in india, you get taxed heavily when you import production into india. And you cant own any store and operate a store if youre in india. So when apple looks at this very complex supply chain, right now centered in china, theyre going to be looking at other factors, such as these National Rules of owning and doing production in other countries like india, vietnam, and places that will allow them to open up stores so we believe that this is an evolution, a stepping point, but importantly, as spoken earlier, the infrastructure of shipping, trucking, transportation, plastics, metals, bending, all that infrastructure needs to be in place, but we believe that it will happen. That apple will, indeed, diversify its supply chain beyond china, what we know today. Is that going to be the legacy of this trade war, you think . Sore is that even clear yet . More diversification into areas outside china. Or is this just the u. S. Kind of an isolated case, where there are going to be some temporary changes made, but not so much longterm . No, i think this is a longterm shift sor sorry, thats for zani. I think this is a longterm shift, because whatever the outcome of this current paceof the trade war, we are seeing a big shift in the u. S. In its relationship with china. And we have clearly moved towards a strategic competition kind of relationship and i dont think thats going to go away anytime soon. And so the sense that there is high tech rivalry and the concern about being too reliant on china is going to stay. And therefore, i think all companies are going to have to rethink their supply chains in response to that its going to take a long time its not going to be overnight, but even if there is some kind of breakthrough at the next trump xi meeting, dont expect this trend to stop this is a permanent shift. The question is how big it is, how deep it goes, and what it means for the future of globalization and for these supply chains. Jim, im going to ask a question ive asked many times on our air before. I get that youre seeing these supply chain dynamics play out, these changes play out ill use the case of apple, for example. In the midst of this u. S. china trade war situation, but why cant a company like apple start to bring some of its supply chain or some of its manufacturing back to the u. S. As well . Well, i think some of the skplin is going to continue to evolve and some may come back to the u. S. In small amounts. But keep in mind, also, the hourly relative cost of labor, plus the health care costs, retirement costs, unemployment costs are simply a lot more expensive than shipping something via air or sea internationally. But when you look at development, you have seen apple actually expand its campus, right here in california, as well as in texas, also those may not be Assembly Jobs we have seen the shift for production years ago, it was the shift to mexico, then the shift to china. Were seeing now a shift to potentially vietnam and india and other locations. Assembly simply as a lower cost tends to look for a lower cost of labor we do believe jobs are coming back to the u. S. Some of them specifically more high tech, some of them more programming jobs, some of them more hightouch jobs apple has been higher in california and in texas. Maybe not the Assembly Jobs were talking a lot about today, but is more higherskilled labor. Right theyre talking about an extra thousand people in seattle that they hadnt talked about before. Zanny, on this trade thing, im wondering, what about stability . The Trump Administration has seemed to really like these onetoone deals as opposed to bigger, broader deals like the tpp, which the administration backed away from doesnt that also play into how this plays out i mean, china could be a source of stability for some countries that are looking for a sure thing. I think stability, or rather, the lack of it, is going to be a really big problem going forward. The Trump Administration has correctly, i think, identified problems in the trading relationship with china, but you can have a very long debate about whether theyre going about solving them in the right away and the weapons of mass destructi destructionization is something that introduces enormous instability. If youre a company anywhere in the world now and have any links to the u. S. Financial system, any links to u. S. Markets, you simply dont know which bit of the u. S. System is going to be weaponized next. So that brings massive instability. And if you take a sledgehammer to the existing trade system but not very keen on building up anything in its place and not very keen on working with allies to build something new, then we have a whole load of instability. So i think youre absolutely right, thats a really big problem. And on top of that, you also dont have, i think, a mutually compatible view of what success looks like between the chinese and the u. S. And that for me is a real problem. Because the chinese increasingly think that the u. S. Simply wants to contain them, to keep them down and if they get that view, then its very hard to see how you get a kind of positive outcome to all of this so, yes, theres a problem yes, theres a trading problem that the administration identified, but right now, were on course to an awful lot of instability. Yeah, some people have been calling it a tech cold war jim, in terms of your coverage universe and all the macro uncertainties and the way this has been playing out in tech stocks in recent weeks, recent months, where should investors be putting their money right now . Well, we do have a buy rating on apple, and our target price is 205. But it is not our top stock pick because we believe consensus expectations are too high, and these trade wars are going to cause a little bit of a preference shift to the National Brands there in china, for some of those local domestic brands our top pick is actually a Company Called keysights, kyts nooirt ve theyre not very well known, because theyre a detailed intricate company that does 5g testing. We believe 5g globally will roll out and be a very big part in everyones life. So while we do have a buy rating on apple, currently it is not our top pick but we do have an upside for 205 for our target price for apple. All right, jim, zanny, good conversation thank you. Well, big deal to get to this morning in pharma all all allergen being bought in after 60 million cash and stock transaction. That 63 billion doesnt include about 20 billion in allergans debt. Thats a more than 80 billion deal altogether. Abbvie shareholders clearly dont love it off the bat, selling stock throughout the morning and after a conference where ceo Rick Gonzalez laid out his rationale. He says it gives them products rather than abbvies drug humira, which is expected to face direct competition in 2023. And he told me by phone this morning that the combined company will look in size a lot like eli lilly, but it will be a little more profitable and grow just less than 10 a year over the next decade. He said hes not surprised with the share reaction this morning, but said, quote, i cant think of a single scenario where abbvie isnt better off than without allergan with the purchase, abbvie gains allergans blockbuster drug botox and gonzalez says thats not all thats attractive among allergans 15 billion portfolio. He also pointed to products in migraine, gastrointestinal disorders and Womens Health its not a bet on allergans pipeline any successes from drugs in development would be further upside to the deal abbvie does plan cost cuts of at least 2 billion within three years. For allergan shareholders, its a culmination of a somewhat tortured road. Shares had rallied recently on speculation that the company would split in two, but clearly ceo Brent Saunders had bigger ideas. He is, of course, known for pharma deal making, as thats how he built allergan and he will join abbvies board guys, over to you. In terms of the deal making, meg, weve seen so much consolidation in this space in general in the last couple of years, will this continue to fuel more . And whats still out there that could be of speculation for m a . A lot of people have been really focused on biotech targets this year, morgan, like pfizers deal for array, for example. But we also see these deals like bristolmyers buying sell geceln abbvie buying allergan speculation today is kind of turning to Companies Like biogen for example, a Big Biotech Company that had a disappointment in its pipeline in its alzheimers drug recently so these companies that are very large, do have cash flow and revenue, but have faced some setbacks now are being considered potential targets and these would be huge deals to continue what weve already seen in this space. Meg terrell, thank you. Thanks. When we return, still much more ahead from vietnam and our live coverage from hanoi but next, is instagram listening to your private conversations . Well tell you what the head of instagram said next. Stay with us dow is down 49 creating the perfect night. Just takes a little creativity. The light beer youve been waiting for has arrived. Lower carbs. Lower calories. Higher expectations. Corona premier. So should the way you bank. Virtual wallet from pnc bank. Just one way pnc is modernizing banking to help make things easier. Pnc bank. Make today the day. Welcome back facebooks head of instagram, adam laseri appearing this morning talk about deep fakes and the companys ad policy. Julia boorstin has more from los angeles. Thats right, adam moceri took over for the apps founder last fall. This after franoutrage followin facebooks refusal to remove edited videos of nancy pelosi and mark zuckerberg. Mosseri says they do not have a policy against deep fakes and he doesnt feel good about that fif it takes too long to identify it, at that point, the damage is done we could declare victory, but thats not a victory at all. Thats very hollow the thing were focused is not if you take it down when you find it, but how do you find it more quickly if we dont, if a Million People see a video like that in the first 24 hours or first 48 hours. The damage is done. The damage is done. Mosseri also denied that instagram listens to consumers or looks at their messages to deliver ads based on what people are talking about. If youre into food and restaurant, you like the restaurant, thats subconscious and bubbles up later i think this happens in ways that are really subtle but we dont look at your messages or listen in on your microphone doing so would be super problematic for a lot of different reasons. These two lines of questioning, whether people can trust the videos they see ton facebook and instagram or whether they can trust that the company is not spying on them speaks to consumer concerns about facebook and its family of apps that dont seem to be going away guys julia, i think this issue of whether facebook and instagram are listening, i hear it come up all the time, but it shows to me just how good their targeting is like, sometimes, they can guess what youre going to talk about before you even know that youre going to talk about it yeah. I mean, jon, its definitely a sign that their ads are good the question is, are they too good that its creeping people out . And are people creeped out enough that theyre going to opt out of ad targeting, which of course would be bad for facebook and make those ads less valuable but what instagram and facebook would argue is that having ads that are that good that it almost seems like theyre listening to you would make them more valuable to you and actually things that you will want to click on yeah, im totally one of these people thats creeped out because i get a lot of these hypertargeted ads and i do feel like, at times, feel like its more than coincidence. But that being said, the deep fake part of this, its really, really worrisome to me and i cant help but think that from a facebook and instagram point of view and social media in general, its a really beg future business problem as well. Because if you have further erosion of quality control, content control, as you mentioned, is that going to turn users and potentially advertisers away i think youre absolutely right, morgan. This is the next frontier. Were just starting to see the early days of these deep fake videos and from what i understand, the real challenge is that the technology can be so sophisticated that it will be hard to identify them and pull them down before they can go viral. This is definitely something that facebook and other platforms such as youtube are thinking about but were just sort of at the tip of the spear in terms of how bad and how dangerous these could be if you look at the difference between this coming election cycle and the last two cycles, how fast that technology is moving and whether the next round of manipulation that we see around the elections could be from deep fakes, people seeing videos that are just totally fabricated well, julia julia, it seems to me that the problem here really is that social Media Companies have worked hard to destroy the idea of credibility. Its ike, content if anybody just as good as content from anybody else one of the ways you could fix this is by having a tier of content from people who promise to post true stuff and if they post anything thats close to a deep fake, you dej t delegitimize them. And then if somebody goes on and theyre looking right youre talking about a whitelisted group of respected news outlets and i think that totally makes sense, jon thats something ive been talking about for a while. Why not distinguish between different types of news outlets. But i think when youre saying that social media destroyed the idea of credibility, they might say they just sort of expanded the idea of credibility into a much broader definition of, you know, group of people could be publishers of content. I think that we may see them move closer to that idea, this idea of sort of trusted news sources. And theyre already trying to, you know, post warnings on different types of content that are not necessarily legit or safe and theyre saying that deprioritize questionable content and make it harder to share, but theyre not saying theyre going to pull it down entirely unless its totally dangerous. The question is, how much further facebook and instagram go in terms of raising the bar on what kind of content is really allowed on their platform, rather than just deprioritizing it. Julia boorstin, thank you after the break, the latest in fedexs dispute with huawei and how the u. S. Commerce department is factoring in still a lot more from vietnam straight ahead, including were live in vietnam today, where one company has changed the game more than anyone. Thats samsung, investing 3 billion in this industrial park, which now employs 60,000 people, makes more mobile phones than any facility in the world full coverage from vietnam ntuealdatoy cc. My degree from snhu has helped me tremendously. The flexible class schedules allowed me to go to work full time, run my catering business and be a mom and parent. When i reached this accomplishment, it was like, its here, its happening, its now. We at Southern New Hampshire university are the ones who succeed. We are the ones who break through. Welcome back to squawk alley. Check out shares of fedex. Those are down about 2. 5 today. Down 5 on the week so far the delivery giant suing the u. S. Government, claiming the Trump Administrations latest restrictions are essentially forcing fedex to police millions of packages daily to ensure prohibited items arent being exported to huawei quote, fedex is a transportation company, not a Law Enforcement agency thats a statement from the company. The move coming after a shipment containing a huawei phone destined for the states was returned to its sender in britain. What fedex called a, quote, operational error. And also after several huawei packages were misrouted a few weeks ago. This lawsuit filed in federal court yesterday in d. C. , 19 pages long doesnt actually name huawei specifically, but does come amid this broader u. S. china dispute. The argument, as a common character, fedex is not liable for the contents of shipments, and that, while it does scream names, even if edex opened each package, it wouldnt be able to make the determination about whether those contents actually violated u. S. Restrictions cnbc also reached out to u. P. S. Which said that it isnt joining the lawsuit and that u. P. S. Has not experienced any difficulties in complying with government directives in the markets that the Company Operates but this is in focus for fedex, at least chinese regulators have opened an investigation staterun global times tweeted sunday that fedex is likely to be added to chinas unreliable entities list. Chinas a key market for fedex, its a critical growth market. Theyve invested a lot of money in the area. Its very key to express operations in the region i would expect were going to get more comments on this, because the company is going to report after the bell, jon meantime, we have actually seen this company, even before all of this situation with huawei has unfolded, have no revise its forecasts, both in december and back in march, in part because of slowing Global Growth in europe as well as china. Yeah. Well, thats what uncertainty does, i suppose. Meanwhile, european markets set to close just a few seconds. Dom chu has the breakdown. Dom . Jon, morgan, european markets, at least the major forces here, mostly lower with notable weakness in italy and ongoing budget tensions there become at least more prevalent between rome and the european commission, so thats a big story playing out there. Two key pieces of weak macro data setting some of the tone as well first in france, a survey of Business Confidence this month came in weaker than expected, adding to some investor concerns that europes third biggest economy would be slowing down, despite recent jobs data on the stronger front the yield on the french tenyear Government Note is once again trading in negatory, so watching those Government Bond yields meanwhile, in the uk, retail sales this month posted their largest year over year decline since 2009, in part due to kind of unseasonably cold weather those weak results weighing on shares of british supermarkets like morrisons and tesco, as well so were watching those. Other companies in focus, you have renauld out in france the carmaker will postpone talks with its french partner on their deepening allegiance, pledging to focus on their own recovery efforts. Renauld shares traded down as much as 2 today and finally, a big merger in the i. T. Scuttconsulting space c c capgemini proposing to buy and the combined group would house 250,000 employees. Shares of altran on pace for their best day of trading since 2003 so some activity on the Company Front on the european side ill send things back over to you, morgan. Thanks, dom lets get over to courtney raingrai raingan for a news update. In his first public appearance since a crushing defeat in the istanbul mayoral election, turkish president erdogan vowed to draw lessons and make adjustments in line with the message given by the people he was addressing legislators from his ruling party in Parliament Hundreds of members and supporters of leftwing organizations marched against secretary of state mike pompeos scheduled visit to india today they chanted antiu. S. Slogans and called out the u. S. For its support of israel and for imposing sanctions on cuba, iran, and venezuela. Aaa predicting a record 39 Million People will travel for Independence Day thats an increase of 4. 1 from last year. The majority of americans will hit the road while just under 4 million will fly it was ten years ago today that singer Michael Jackson passed away at the age of 50 he left behind three Young Children at the time thats our cnbc news update for this hour. Lets get back over to squawk alley all right, courtney and up next, vietnams role in the u. S. china trade war and why companies are flocking to the country to produce their goods. Well head back to vietnam after the break. Meanwhile, major averages are all in the red, though the dow staging a bit of a comeback in the past few minutes. Nasdaq faring the worst of all some tech stocks taking it on the chin shopify, match, and roku among ose. Were back in just a moment. Welcome back lets get back out to Carl Quintanilla in hanoi, vietnam. Carl hey, morgan you know, weve been talking about vietnam, of course, all morning long, about their manufacturing resurgence weapon wanted to play just one slice of Life Cultural story that involves the sofitel met ropol hotel here in the city its been around since the early 1900s, well before the vietnam war. During a renovation about eight years ago, though, they found a very haunting discovery. Down these stairs, under about two meters of concrete and sand is a bomb shelter that was built for guests to escape from air raids during the vietnam war, or as the vietnamese call it, the american war it had multiple chambers and multiple doors, all made of iron, obviously, very low ceilings, equipped with electricity, Lighting Fixtures and ventilation. Pull this open and air was able to come in for about 40 guests to be in here for about half an hour, as they waited for u. S. Planes to finish their bombing raids overhead its obviously an incredible and an incredible feeling, imagine being in here, not knowing what you were going to find when you went back upstairs but despite all of this, the vietnamese continue to have a very warm view of the United States and thats one reason this trade relationship between the u. S. And vietnam continues to be so important. Morgan and john, if you ever find yourself in hanoi, its quite an experience to go dound there. It does sort of bring to mind the mindset of the vietnamese worker i dont know, jon, morgan, maybe youve been to china and checked out the Guangdong Province where so much high tech manufacturing is but youre dealing with a population of 100 Million People that go back and forth between the countryside and the city they call it the biggest mobile workforce in the world and the question for vietnam will be whether they can recreate that somehow and train them in ways weve been talking about all hour now, carl, you said that hotel was renovated eight years ago, but that shot of outside of it made me question just how much it was renovated. And also raised the question if vietnam wants more of this international business, more manufacturing, what are the conditions like, the accommodations for Business Travel for Business Travel, right, youre talking about we talk so much about manufacturing and it is the Assembly Workers who are on the production line, but theres also midlevel managers who have to live there in many cases with their families. So you have multiple levels of retention practices that have to take place will there be services are there coffee shops and schools that will let these executives continue to work and operate between manufacturing hubs again, this is just an example of how complicated it is we have this notion on tv, move your supply chains out of china, find a vendor and get going. It doesnt work like that. The only way you can figure that out is by coming to places like this and talking to people on the ground in terms of a mobile workforce, you used the example of china, carl would the fact that you are seeing so much growth in vietnam right now and this demand, is it going to change immigration policies or has it already helped shape immigration policies in that country in terms of being able to bring more skilled workers in . Thats a good question, right now they really, with 95 Million People, they have to take it from some other part of the economy. Would they be able to retrain people from the rural areas . Would people give up their farms to move to the cities . Thats what we saw in china 20 years ago. People from western china came to the coast and learned how to work on manufacturing lines. But those are big mysteries when it comes to vietnam. Even though were here, there are a ton of unanswered questions. We unmoney is flowing in, we know commitments have been made. We know some of the giants are on the ground, but those longer, lessvisible curves behind those corners are much harder to see, youre right i know its late, carl. Youve been working hard, so i hate to throw you a curveball, but any surprises . I know what you expected, perhaps, to find when you went out there to report, but what, if anything, has caught you off guard and stuck with you its a good question. I think the conversation about tpp, would vietnams chances have been better had the u. S. Not pulled out would vietnam in the end be more competitive as a signatory to that deal with the u. S. . Thats a big question. I also was, you know, i think interested to learn about the way the vietnamese see the chinese as perhaps their biggest external Security Threat theyre very wary of the chinese, maybe abz was wary as United States is, because of their history, their history of occupation, their general unfavorable feeling about what the chinese are up to. So even though theyre taking in all of this capital, theyre still very cautious about who its coming from and what the chinese motives are for investing in this country. I thought that was interesting yeah, carl, thats such a key point. I wonder how the Trump Administration, whether, you know, there have been any comments or sense of sentiment from the Trump Administration about this idea that you have some manufacturing, some of the supply chains shifting from china to vietnam in the midst of that relationship. Yeah, we actually this came up on squawk box this morning. We have a trade imbalance with vietnam. And the president really hasnt mentioned that, because hes been focused on trade imbalances in other countries like china. But if vietnam really got the pedal to the metal onall of that and that target got bigger, would our targets turn on vietnam as well . Question just dont know thats the weird new world were in when it comes to international trade. And the way the u. S. Is playing this trade game. Weve heard comments from novarro today, the u. S. Trade rep about the eu they say they want a rock solid relationship and thats probably true, but if any i mean, if this administration is pursuing anything, its that they are unpredictable and they do turn on corners and im sure the vietnamese are taking stock of that, as well. Well, some things you only really learn from being on the ground, so glad weve got you there doing the hard work, carl. Thanks and still to come, is bitcoin back we will discuss after the break. But first, Rick Santelli, what are you watching im watching a 198 tenyear and im listening to you and many others talking about bitcoin. Were going to tie that altogether after the break well, we talked about it before the break, now lets do it get to the cme, Rick Santelli has got the santelli exchange. Rick thanks, jon when i look at the equity markets, im always amazed, especially lately. Theres a lot of headwinds coming into stocks and yet they keep coming back as a matter of fact, just quickly, s p 500 going back to 2015 im not going to slice and dice this in a big way, just a generic thought. Single tops, even double tops, theyre important. But when you start getting one, two, three, four, i have a saying, theres no such thing as a triple top, which means theres no such thing as a quadruple top or a quad top. Theres single tops, double tops, and then there are patterns and this is going to turn into a pattern. And ultimately, it certainly looks like a pattern to go higher thats the table setting for what i really want to talk about today. See, when it comes to equities, there were two issues we need to be really cognizant of one, were living through. Taxes. Okay, tax reform certainly gave it a tailwind and it gave the whole economy a tailwind but many said this would never going to garner the multiple quarters of 3 plus growth true, maybe, maybe not however, its hard to tell, because this is still unresolved so while this goes on and maybe this could actually replace the taxes as a tailwind and get some more capitalspending, business spending, which has really been lacking. But, we are now at this quasi top. We have this issue and all of a sudden safe harbor trades are everywhere so whether were talking about bitcoin, as jon fortt was mentioning or, of course, gold, but the biggest i want to talk about are sovereign bonds. Throughout the globe, whether you look at switzerland negative rates, you look at france now turning negative rates, japan, negative rates, bund negative rates, our rates dropping like a rock, this is a big deal, and investors understand they may be trying to avoid some of the uncertainty in equities, creating a safe harbor trade, but ultimately, heres the issue i see. That as this continues to take hold, something magical happens and it always happens. And that is, low rates and whats the deal with low rates . Well, think about it low rates was at the beginning of this whole chapter. Its what Central Banks wanted to do. Why . Because they wanted you to go to riskier issues, riskier investments and put your money in places that might grow faster, but they want you to avoid the low rates. I guess what im saying is, no matter how you slice it, it certainly looks to me like all roads lead back to equities. Heres the trigger how it plays out, we will have to see but there are no triple tops and i really think that we havent topped out on investors that are going to be lured into equities once some of these trade issues get resolved morgan, back to you. Rick santelli, thank you. Bitcoin surging back above 11,000 you just heard rick talking about it again, higher this morning, but is it back seema mody has more from hq. Seema . Hey, Morgan Bitcoin breaking above 11,000, a 15month high is notable, because the cryptocurrency has only traded above 11,000 2. 4 of its total days in existence. While the unveiling of Facebooks Libra has played a role in bitcoins comeback, its worth noting that it was already up about 140 this year, prior to the announcement. Others say bitcoins rise has less to do with libra, which is designed as a means of payment for International Money transfers and more about the uptick in geopolitical tensions from iran to turkey to the u. S. china trade war data from crypto compare illustrates how International Demand for cryptocurrencies has been on the rise in countries like china now, this is data based on volume in the last 24 hours. Theres some discussion around whether there is a correlation between gold and bitcoin one Portfolio Manager telling me, its less about the correlation and more about investors trying to diversity smaller parts of their portfolio into other assets. Genesis capital, which manages cryptocurrency funds for High Net Worth clients, bitcoin is still down about 35 from its alltime highs back in late 2017 one of the big events to watch this summer, morgan, will be the House Financial ServicesCommittee Hearing on Facebooks Libra, i believe thats july 17th you can get that cryptocurrency and fintech watchers will be watching developments closely. Absolutely, also tech investors. Seema mody, thank you. When we return, spacex launching its falcon heavy rocket on its Third Mission late last night meantime, a check on where we stand in the markets. Stocks are lower today the dow is down 52 s p is down 10 nasdaq, the big underperformer, down about 0. 8 . Still a bullish month, dow on ceor best month since october 2015 stay with us Johnson Johnson is a baby company. But were also a company that controls hiv, fights cancer, repairs shattered bones, relieves depression, restores heart rhythms, helps you back from strokes, and keeps you healthy your whole life. From the day youre born we never stop taking care of you. Wanna take your xfi now you can with xfi advantage. Giving you enhanced performance and protection. When devices are connected to your homes wifi, theyre protected. Helping keep outsiders from getting inside. And if someone tries, well let you know. So you can stream, surf and game all you want, with confidence you can get coverage where you need it most. Thats xfi advantage. Make your xfi even better. Upgrade today. Call, click or visit a store. Welcome back to squawk alley. Spacex pulling off what elon musk has called its, quote, most difficult launch ever, the falcon heavy blasting off at 2 30 a. M. Eastern time from Kennedy Space center, lighting up the night sky over florida with fiery trails as it carried out an Experimental Mission for the u. S. Air force, and later triggering loud sonic booms as the two side boosters successfully touched down upright at Cape Canaveral station. Its the Worlds Largest rocket, the first time the u. S. Government has allowed a satellite to be launched aboard a previously used rocket experiments included include a new type of propellant for nasa and the cremains of 152 people. For the first time ever, spacex successfully caught the rockets expensive nose cone. Why that matters, the more hardware that spacex can capture and reuse, the more it can drive down launch costs. So a lot was riding on this since a successful launch is expected to mean certification for falcon heavy for future National Security missions and this could help cement spacexs position as a goto launch provider for the military for most of the next decade, jon. Of course those types of contracts are very lucrative spacex valued at more than 33 billion, its almost as great as the valuation of tesla which was about 38 billion. And you say cremains, thats cremated remains of 152 people, i didnt know they did that. Next, after the break. Would you move out of china to vietnam the 95 Million People certainly hope so. The only question is whether vietnam is equipped to handle that new business. Live reports from vietnam all day today on cnbc. Woman my reputation was trashed online. I felt completely helpless. My entire career and business were in jeopardy. I called reputation defender. They were able to restore my good name. If you are under attack, i recommend calling reputation defender. Vo theres more negativity online than ever. Reputation defender ensures that when people check you out, theyll find more of the truth, not trash. If you have search results that are wrong or unfair, visit reputationdefender. Com or call 18778668555. It has been such a big three hours, carl, your work has been fantastic. Also a little shoutout to your producer, justin, please give him a big high five for me what else is coming up yes, justin solomon, alex herrera, kelly wynn. Were here on the ground, trying to give you a sense of what is changing in vietnam. G20 this weekend, nobody has an edge on whats going to happen on the trade front we could wake up monday morning and the news could be much, much different. Keep in mind, the president has been here in hanoi, talking to the Prime Minister the Prime Minister has been in washington with promises of orders so this trade relationship is important too, even though all eyes are going to be on trump and xi all right, carl and as we head to noon, take a look at the major averages the dow is off the lows but still off a good 48 points s p and nasdaq also lower. Tech stocks in particular that are suffering, i mentioned earlier that shopify and roku were doing so well on the positive side, there are a few western digital, not doing too badly. That will do it for squawk alley. Well send it over to the judge for the half. Jon, thanks. Im scott wapner next, why so much is riding on osaka this weekend and what it means for your money its 12 00 noon. This is the halftime report. Announcer we are days away from a Crucial Point in this rally. A moment that is likely to push stocks higher or sink them president trumps trip to japan for the g20 summit will we get a trade deal with china . If not, can we count on Central Banks to keep the bull running see what the market thinks the Investment Committee is ready to weigh in. The