Transcripts For CNBC Squawk Box 20200203

almost 100 points. s&p futures up by 13.5 the nasdaq up by 41. that airports good morning to you. the new rules are in this we watch so closely, which of morning and the biggest impact course that yield has come under is that the u.s. is no longer pressure as fears about th, this allowing foreigners who have been to china within the last two weeks entry into the united morning trading at about 1.529%. states that means when they come through customs, if they say they have been to china within overnight stocks reopened for the last two weeks, they will trading in mainland china after not be given a visa to enter the week-long lunar new year we also know that there are other countries, dozens of other countries around the world that holiday. the shanghai down by 7% and have put in similar travel restrictions three domestic u.s. carriers shenzhen down by 8%. you're talking about united, we'll start with matt taylor in american airlines and delta have singapore on this selloff. cancelled their service to matt, good morning. china. >> good morning to you delta's won't resume until the remember, it was january 23, the end of april and it looks like last day we saw mainland china the airlines will be largely responsible for screening these markets and the shanghai incoming passengers to decide whether they will then be composite having its biggest one-day decline since august allowed to board the plane as 2015 the biggest one-day decline leslie josephs reports on we've seen after a lunar new cnbc.com that puts the airlines year holiday in 13 years in the position of not only it barely managed to recover any asking every passenger have you been to china recreptently but o losses ending down 7.7%, wiping off about $420 billion of market thumbing through passports and looking at their itineraries and value. around 2,500 stocks trading limit down of 10% as well. trying to piece together where people have been the chinese central bank moving the rules are inconsistent to allay some concerns saying passengers coming in from africa the selloff perhaps might have and senegal and nairobi said been a little overdone also saying the impact from th they were never asked whether virus will only have a temporary they had visited china but in impact on the economy. india they had been. the stock market plunge, they >> we have been asked about say, was driven by some whether we have been to china. irrational factors or even panic whether there is someone else that came to my place and did i triggered by the so-called herd interact with anyone that came from china effect, is what authorities were saying authorities moving to pump in a lot of liquidity to support the market and the pboc injecting >> the department of homeland security and the faa have now around 174 billion into the financial markets and also said 11 airports will be allowed providing support by unexpectedly cutting the 7 and to accept passengers these are again american 14-day reverse repo rates by 10 citizens or foreigners who are immediate relatives of us. basis points each. there's a lot of talk that the citizens permanent residents and the like loan prime rate, this is set if they have been to china they later this month, around the 20th of the month, could also be will be funneled through 11 doest manic airports including cut. the chinese yuan weakening to its lowest level since december. jfk here as you can see, falling below again they're relying on passengers largely to be honest that 7 level about where they have been and we're used to seeing it sit who they have interacted with. around 6.80, 6.90. we saw fairly big moves in the >> the u.s. economy was facing a number of new challenges currency, 0.8 or 0.9 of 1% steve joins us as we try to a drop for the shanghai market, calculate the impact of all of them combined. of course playing catch-up since january 23rd. >> i had seen some reports >> one of the major challenges that could depress growth in the suggesting chinese security regulator was telling first half of this year in which brokerages, proprietary traders, markets believe could bring the federal reserve back into play they weren't allowed to be net the coronavirus probably equity sellers this week downgrades the economy some what is that true >> there were some reports less to the u.s. economy boeing suggesting big fund managers, remember we were talking about big mutual funds as well really that last week that could by itself take a half shouldn't go in and sell those point off usgdp this quarter and stocks if they really didn't have to. maybe next so, this all happening right tariffs. the u.s. and the world economy around the time the market still face substantial tariffs opened, about 9:30 a.m. local and some of them came off and time this morning. we did, of course, see the most of them remain. u.s. manufacturing and global market plunging sharply. more than 8%, 8.6%, in fact, was economies were already weak though there were some signsof the low point for the shanghai stabilization. several forecasters said it composite. could reduce china's gdp by up recovering if it hadn't been for some to a half a point and that could liquidity pumped into the market, given we saw so many shave a few off the first half stocks going limit down, that the people's bank of china 10% move down that they can only responding to a potential slow do in one day, things could have down and some u.s. forecasters perhaps been a little worse out think the fed could cut as well. there. >> yeah. it suggests maybe the selloff ubs writing a commentary over wasn't overdone if you have all the weekend. these stocks limit down for the and they believe that that softness will ultimately drive day. >> it's not without precedent for the chinese government to them to materially reassess. that's the fed's own language insist on, verbal intervention and to tell brokerages, we've that they're using to change policy the outlook and to cut rates 3 seen them do it before it won't be a surprise times, usb sees growth of 0.6% the other thing i would say is you close your markets for an entire with week in the united states this they do that by design for the quarter and next lunar new year morgan stanley on the other hand we have rules in this country against that because you want is more upbeat they wrote in their commentary liquidity available for when while the coronavirus people -- you're going to get a massive move. development does imply some near >> you don't want panic selling. >> you want the market to be term growth it should not derail able to respond in real time and the global recovery. investors to respond the downdraft in global yield on real time rather than making everybody wait for an entire stocks on friday suggest the week before they can actually bearish view is the one get into the market. prevailing right now the fed funds future market now remember, after 9/11 we -- our trading with a 70% chance of a stock exchanged worked very hard rate cut in september and to reopen because they felt greater than 50% probability of liquidity was an important a second cut by december mandate. >> sometimes you want a weekend or a time -- what happens guys as you know, >> this was a week. the financial markets price this >> the question is, would it in immediately around the world. have been worse the other day? >> i don't think so. and then we wait for the hard when you can respond every data to show it or not. single day absolutely, i think -- >> can you remind me the >> sometimes you want -- the reason - mechanics of central banking >> the question is, what happens tomorrow >> that's why you have a limit banking liquidity. down, right? when their central bank injects it goes down 10%, everybody take a breather we're going to shut down for a liquidity into all of the banks, few minutes, relax what is that doing to them and bring it again. >> you argue you want it to be are they unable to get on all the time or not the limit down thing to me goes straight to the argument that you don't really want the liquidity -- >> there's no freeze up in the markets -- >> it's to assuage concerns like interbanking market. the other is it provides more yours. basis for additional loans whether limit down works or not, possibly in china. i don't care but you should not they did this back other times have your market closed for an 2015-16 they are injectedly entire week. >> i like limit down to let the steam blow off eventually, have it ease and quiddi -- injected liquidity and they have take it off. we would have it slow down for a not been shy about acting in few minutes and see what these cases. >> joining us to talk about all happens. it's not like crazy trading of this on the squawk newsline coming from computer algorithms is the chief economic adviser. and things, too. he also penned an op-ed in the >> we have to thank matt, by the financial times over the weekend way. i don't know if he's been on that topic. waiting for us to thank him. the piece is entitled coronav the death toll from the coronavirus outbreak rising over the weekend. the number is now 361 in mainland china with the number virus should snap investors. of confirmed infections surging you think things are going to get worse before we get any sort of control in this situation. to more than 17,000 worldwide. the first death from the virus >> i do, becky outside of china was reported in this is different than what i the philippines. thought for a long time. 11 cases have now been confirmed for a long time i thought that in the united states the market sentiment was so strong that we could overcome a mounting list of economic uncertainty. but the coronavirus is we'll get eunice yoon who joins different. us on the ground. it's big >> there are more signs in the it's going to paralyze china economic damage and the fight against this virus it's going to cascade throughout the global economy and pornly it in the town of wenzhou, famous cannot be counted as we just noted by central bank policies for small and medium businesses as well as manufacturing, they have imposed a partial cure few so i think we should pay more on its residents attention to this and we should through next weekend, each household has to assign one try and resist our inclination to buy the dip. >> mohammed, your big concern on household member to go out and do the shopping for daily this is that what we're hearing now that the shutdowns will take place february 9th i guess is not going to be the case we're going to have to step back necessities every other day. and wait to see what happens and i was speaking to a factory then assess from there >> yes it paralyzes economic manager in guangdong says they are requiring two masks per confidence so how often do you get a shock worker every single day. that effects the demand and the supply side that disrupts he has 1 50ish,500 workers domestic and international the fact there's been a lack of activities masks here has been raising a that derails the service sector lot of questions about exactly at a time when the manufacturing when several of these factories sector is still weak and all of are going to be able to reopen this, in the context of also, just yesterday 10,000 flights were canceled. part of that was domestic and frigility in the global economy. i worry about this also part because of the this one is different. it's not did disruption to saudi decisions by several different oil production countries now to restrict the it's not the missile attack that the u.s. carried out on an travel and entry of chinese iranian general. this is a fundamental shock to nationals. the foreign ministry today economic growth in china. >> mohammed, i want to ask you blamed the united states for how we're supposed to process that decision because they said that the u.s. was the first to the hard data. we're going to get a lot of data impose this travel ban this week. the jobs number comes out. they've described this as an we have ism at 10:00 today overreaction on the part of the u.s. and said that the u.s. is this is data that the market -- now creating and spreading fear. >> it's all outdated but that's guys >> i guess the u.s. actions are only the first part of my question then we're supposed to look following china's own actions to through the first quarter data and discount that from the try to impose travel bans on the boeing shut off or shutdown and then -- i mean, when do we go most infected provinces. back and say here's the true it's interesting to hear that back and forth on some of these issues state of the kmeconomy? i guess the biggest question i among the things you're saying have -- i do see traffic behind it's just too much for the market to discount. >> yeah. i mean, put one phrase in your you. how many people are out when you go on the streets? i mean, if the stores were open, head, steve, if i may, which is if the starbucks were open, how many people would actually be in accelerating sudden stock those places dynamics we know it well in the financial sector >> reporter: it's a little bit that's what hit us in 2008 more populated than the past couple of days because n theory, we don't often see it on the economic side. it's increasingly a sudden stop the city and the country is back to economic activity in china at work. but there are a lot of people and it comes in the context of who are working remotely earnings haven't been good the data on the us., i don't still, everybody is wearing worry about the backward looking masks. there are a lot of shops that are closed data in the u.s. but it does you mentioned starbucks. come, the context of weak european data, already we only all of the starbucks i've been trying to go to around this area had economic growth of 1.2% in have been completely shut. 2019 for me, that's very close to you know, when -- just an hour stall speed. so look at the effects first and ago i was doing a live in front foremost showing in china. of the central bank for that data is going to pick it up "worldwide exchange" and there's a mcdonald's there quickly. then emerging asia that mcdonald's is shut. then in europe there's still not a whole lot of and it will come to us in a much economic activity. and it's still -- there's still smaller scale and it will come a big question mark as to to us much later than elsewhere. exactly when a lot of those so it's going to take a little shops, especially the factories, are going to be open. bit of time to play out in the >> does it suggest tensions are u.s. >> mohammed, you went to where i rising between the united states and china again if china is was going with steve so the central bank in china is upset by this travel ban >> reporter: yeah, i think injecting liquidity and bottom that -- that was a really interesting and somewhat line, is that going to help when surprising comment from the foreign ministry people aren't willing to go as you pointed out, not only outside of their door. china has imposed restrictions we had a conversation earlier in the show where the generale on its own people but also the world health organization had declared this was a public generally speaking the market is health issue of international still going to go up from here concern. but you're suggesting that but from the chinese perspective, they said they were central banks can't handle this issue in particular and that's upset about the fact that the not necessarily going to work u.s. was the first one to decide this time around. to pull out its embassy >> yes the playbook has worked extremely well and it's one that officials as well as other americans. that the u.s. was the first one i have deployed which is rely on central bank injection because to impose a travel ban the marketplace believes that liquidity can decouple us and i think what's happening here is something we see quite from fundamentals for a very long time. often, which is the chinese -- so that's the play book and you the chinese authority doesn't see it again today want to take the full blame for the reaction is in a cut something. and often points fingers at the reaction in china is inject what, you know, has been very over 170billion. often described here as foreign so everybody is conditioned to behave this way but it assumes forces, of which the united states is one. that the shock is temporary, containable and reversible >> good to see you i look back at the timing of the and those three phrases are very signing of the trade deal. hard to associate with buyers. and it's kind of around the time that's why i think that the big when the chinese authorities, we risk is that we may finally get now know, knew more than they were telling the world to the point where central banks are shown to be ineffective if do you think there's any not counter produck ttive in eue coincidence? is it possible that they were pushed into this deal maybe sooner than they wanted because and that's what i worry about. >> thank you love to see you in studio again of this? >> i think it's difficult to say soon but we do appreciate your time this morning. because the people who would >> i need to ask him one question i think you're in miami. being be are you in miami >> yeah. negotiating the deal wouldn't >> so give us a review of the necessarily be well aware of what was going on in wuhan, the whole thing. >> you went to the super bowl. >> you went to the game. epicenter of the outbreak. i saw him on twitter and he the authorities -- from what it pretends as if he's so serious with the coronavirus seems in just based on other tell us a little bit about it. reporting, what it seems to be the case is the authorities >> the game was amazing in so many different ways, andrew. there were, like you said, well the game itself. the fans aware of what was going on, but it's lovely to be among fans those are the local authorities. that are so excited and happy oftentimes information does not flow up, essentially these days and optimistic and then miami did a great job in terms of all with the current administration of the arrangements. in place, which is much more we loved it. >> one question and then we do top-down so, because of the nature of the probably have to run they're going to kill us way the bureaucracy works here but halftime the halftime show. where people are -- officers are it looks great on tv not really sure if they should does it look great in the stadium? >> it looks incredible because be flagging problems to their you see the background of the superiors, it's unclear if lights we all had wristbands on that anybody at the top level was -- they asked us to hold up and they changed the colors of the you know, just how well aware they were of the issues in wuhan wristbands so you get the show. you can see the show in detail at the time of the signing of on the big screen but you see it the deal >> eunice, thank you. in a context of tens of meantime, we have corporate thousands of people. news >> i thought this was a good halftime show. wework has named sandeep >> i loved the halftime show. >> he tweeted he burned 500 mathrani, former ed that of calories watching. >> watching. brookfield property group and >> shakira. >> it's a funny tweet. i don't want to take credit for vornado realty group it but yeah then you add the 500 calories that you ate on top of it. >> coming up when we return, thank you mohammed and i'm glad this is a major shift in terms that you had fun of what the company is going to much more on the worldwide market impact of the coronavirus be mathrani is a safe guy this is now a real estate guy. and where you can find safe >> no longer marketing - >> if you had illusions -- hac >> lifestyle - havens in this volatile market the official kick off of >> if you thought it was campaign 2020. lifestyle company, technology kayla is in the hawkeye state company, whatever you thought it was, 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has some wood to chop, as they say. >> yes, he does. when we come back, we'll talk more about the u.s. stock futures bouncing back from friday's losses. markets in china playing catch-up overnight falling sharply after that extended holiday break. we'll talk strategy for your portfolio next. later, presidential candidate michael bloomberg unveiling his tax proposal over the weekend, including a plan to high protein low sugar tax the wealthy. tastes great! more details later this hour high protein "squawk box" will be right back. low sugar so good! high protein low sugar mmmm, birthday cake! and try pure protein delicious protein shakes our retirement plan with voya gives us confidence. so we can spend a bit today, knowing we're prepared for tomorrow. wow, do you think you overdid it maybe? overdid what? well planned, well invested, well protected. voya. be confident to and through retirement. beyond the routine checkups. we're changing what's possible. beyond the not-so-routine cases. 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helping doctors provide care in whole new ways. all working with a new generation of technologies powered by our gig-speed network. because beyond technology... there is human ingenuity. >> it's a company that's a major employer here and the iowa every day, comcast business is helping businesses economy has regained it's footing. she is undecided who she will go beyond the expected. caucus for this evening. to do the extraordinary. bernie sanders has some national take your business beyond. and straw polls but the leader board is by no means set senator sanders had a super bowl party last night but across town pete buttigieg drew a crowd of 2,000 people iowa voters are open minded and they want a candidate that will have the most momentum in the democratic field to beat president trump. not someone that represents a particular ideology. as far as policy issues, number one is health care that's a privilege that only managers get now. >> years ago we used to to all of our employees but it's so expensive that we had to scale welcome back up and it's becoming happy monday morning turns out u.s. equities are increasingly difficult for small rising this morning. dow futures up by 114 points businesses to be able to that doesn't compare to the operate. >> that pinch is 2 hours away in losses on friday when the dow was down by over 600 points. we were seeing gr ining green as downtown des moines too. mike draper felt the popular retailer says that health care joining us to talk about more costs raising up he clips any about what to do, simeon hyman, raise of 2% even for him >> i mean, my mortgage is $550 a strategist for global investment good to see you. >> thanks for having me. >> people are was in they watched our markets fall by month. my insurance premiums are $1,400 over 600 points on the dow a month. friday those are just the premiums. you wake up and hear the that's with an $8,000 deductible shanghai and shenzhen composite are down by 7%, 8%, what do we n health insurance than groceries and housing combined do now >> the green we see on the screen in the u.s. is a reminder that for a lot of folks one sitting on their hands is the smartest thing you can do. that's what you hear he plans to caucus for elizabeth warren he referenced a quote from in many contagions prior, the comedian louis c.k., everything market has gone up any is amazing but nobody is happy reasonable amount of time post >> thank you for that. this for more on the surge in the if you're looking for a polls we want to bring in our safehaven, one thing that has guest. served as a senior strategist work are zero coupon bonds and spokesman for mitt romney's the treasury yields have come down presidential campaign. if you want the most bang for the buck, you take the zeros and also donald snyder is here at least it goes the other way economist at the research team you need to get out of the way of it when things go the other way because yields will rise again but that's a classic safehaven. >> if you buy coupon bonds, you >> you look at the surge with think the yield will go lower sanders. there's a surge in terms of the than this? >> it's a hedge. voting or in terms of the polls. if that contagion gets worse, we could see 1% not in terms of the predictive polls and the other things over the even medium term, the odds are those are going up. if you're saying to yourself, things are going to get bad for >> he's in the lead in the the next few weeks, those yields betting markets. will drop a little further but you have to get out of the way on the other side. >> you're saying the best thing so do is sit on your hands >> that's correct but right now >> there are things you can do on the edge. sanders is in a really good position. you can do investment grade >> does that then carry over bonds have spread associated with it. elsewhere do you think think you have a tiny bit more spread it's very state specific. >> it does carry over. thap a few weeks ago and you don't have to get away from it not only does iowa give you a so quickly on the other side lot of legitimacy and momentum you might consider things like just staying out of the energy going forward. he's already in the lead in new sector it's down 11% this month hampshire and that could push it might not come back so fast because there are real into south carolina. he may not win there but he may structural issues there. do better than expected. >> energy has its own structural issues your point there, if china's economy is hurt badly by this, they are the second largest >> we're calling it a new tax on economy in the globe and there's not more demand for energy wealth over the weekend. >> that's right. to get closer frankly to where there will be lingering issues bernie sanders and elizabeth if you're positioning yourself warren may be the question is post-crisis, you might want to does that move the needle and stay light on energy you might want to heavy up on quality dividend growing type companies that, for example, have grown their dividends last year does that push him out of the the s&p 500 dividend ariis row game completely later? that's always one of the big issues >> yeah. bloomberg has been called into what a lot of folks, even the accurates. >> thank you great to see you. >> thank you. when we come back, kansas more moderate names inside this city winning the super bowl, but field has done which is trying to microtarget their way up the which company won the ad battle? we'll talk about the best and polls by appealing to a lot of worst commercials right after this what's important to you. these most base activist democrat liberals on things like economic policy and environmental policy and social policy >> has been to have bernie sanders get a couple of wins in the early states and then essentially have an establishment freak out so that the -- there's a consolidation behind bloomberg where he and bernie sanders are the only ones standing after he had a couple of wins. >> this is a full rope a dope plan you have going here. >> that's not my plan. that is bloomberg's plan. >> you think it's a true rope-a-dope. you think that bloomberg really wants bernie sanders to win tomorrow. >> i think he's banking on the saving for ava's college. idea that bernie sanders gets a being able to retire on our terms. couple of these wins and then taking care of dad. why ameriprise financial? there's only a few candidates left standing and they're the my advisor cares about my personal goals. ones that have the money he gives us comprehensive advice. bernie sanders will always have the money. i feel prepared for what's expected in life that's one of his biggest powers inside the field which is by and even what's not. she helps us feel confident. forming all the grass roots we know our financial future is secure. donations he lead the way quarter after quarter in fund-raising so if it's bernie sanders, mik with the right financial advice, life can be brilliant. bloomberg and maybe tom that still has his money in the game ameriprise financial. that that really represents the best chance for bloomberg to sort of help consolidate the field inside the democratic establishment. >> do you think that's the whole plan >> i do. i think with bloomberg being allowed into the debates and then you're seeing -- i think if he does that's going to come at the expense of biden and then you're looking at something. >> don't forget, you also had john kerry, our colleagues at nbc news reporting that john kerry was doing conversations with his potential donors about what it would take for him to get in so there's clearly some worry about the surge in the trend line that bernie sanders has right now inside the democratic primary. >> and karey went on the record and said i am not running but when you hear and see the whole conversation that the nbc news producer overheard clearly there was aconversation about whethe or not he might get in. >> definitely indicative of a worry. >> but these caucuses are different because the first go life can be brilliant. around you vote for whoever you ♪ yes i'm stuck in the middle with you, ♪ want and then if you're candidate doesn't get 15% you have to vote for someone else. no one likes to feel stuck, boxed in, or held back. what is likely to happen in that scenario is it going to be bernie sanders especially by something like your cloud. it's a problem. but the ibm cloud is different. it's open and flexible enough gets all of he liz beelizabeth to manage all your apps and data securely, anywhere, that will divide the population at some point. this is going to be interesting across all your clouds. because if you're forced to so it can help take on anything change your vote to somebody from rebooking flights on the fly, that has at least 15% that gets rid of a lot of the noise that's to restocking shelves on demand, out there when you have 11 without getting in your way. ♪ ♪ candidates running. >> i think klobuchar is at the lowest and all of her votes should go mostly to biden but but inside every etf... that favors him at the same time i think warren will probably make the threshold but it's there are untold hours ofand contingency plans... "" going to be split between biden and sanders. creating funds that help target gaps >> let me ask you what i call in client portfolios. tap untapped potential. the rational actor question. one of the things that you keep and strengthen confidence in you. flexshares. hearing on this show and elsewhere is that ultimately the powered by over a century of investment expertise party, the voter will be a before investing consider the fund's investment objectives, rational actor meaning they will only be trying to elect through risks, charges and expenses. go to flexshares.com the primary system somebody they for a prospectus containing this information. read it carefully. think that can beat president trump and to the extent that virtually all the polls show that bernie sanders can't beat trump, what is going on here >> i think, you know, there's one difference in terms of what you look for in a nomination process and that's ideological and satisfying and it speaks to the most effective. >> the rational actor idea might not be rational. >> i think bernie sanders electability is being litigated . congratulations to the now. kansas city chiefs taking the throughout this process you had lombardi trophy back to kansas everybody else coming through and the betting markets tank and city for the first time in 50 fall off and they couldn't beat years. mvp quarterback patrick mahomes trump. bernie never really had that leading the chiefs with three test this time around and he's getting the second look at the touchdown drives in the final best possible and they think he minutes of the game to overcome can win. a double digit deficit >> thank you. >> great to be with you. but we like to talk about the >> you bet. >> when we come back, an indepth ads. >> yes, let's do that right now. look at how the coronavirus hit let's talk about the other big winners and losers, and that the airline industry and how would be advertisers there could be more pain ahead i don't know if you watched the as we head to a break, take a ads as closely as you watch the look at this, though game - the saying goes as goes january >> yes. >> yes. >> thoughts overall? so goes the year for the stock market good bad? >> i thought the production friday's market sell off pushed the s&p 500 into negative values were over the top this territory for the month but the year, even more so than in the good news is that the recent past and progressively more and track record for that old saying hasn't really held up. more we're seeing a lot more ads the last four times the s&p had related to social issues that a down january the index companies want to take a stand on. >> like the snickers ad. actually ended the year in the red just once. >> snickers. and that was by less than 1% >> i actually liked the snickers much more sawbostigonquk x raht ad. >> i liked it. ahead. stay tuned >> especially the selfie guys following it >> yeah. that was the best part of it. >> i can't stand those people. >> i thought both of the political ads were good. i actually thought the trump ad was good and the bloomberg ad was good. >> they were smart. >> they were smart ads in terms of what they were focused on, how they were doing it if you noticed - >> you have to spend the money. >> trump was going to do two 30-second ads. originally he said he was doing two 30-second ads. pushed one of the ads to a cheaper slot after the super bowl was technically over but put that first 30-second ad in early, which forced -- i don't know if it forced the hand, trying to force the hand of mayor bloomberg to do his 60-second ad there will be a debate about who was spending more money on the super bowl. >> and spending smarter. >> i felt conflicted about the google ad. i cried. >> i did, too. >> i actually teared up. >> so did natalie. >> i cried at. yet at the same time, i thought, yes, they know everything about you. it's creepy. it's creepy. >> i saw the perfect tweet that came afterwards. first google tugs at your heartstrings and then steals your data. it's apt my favorite ad was the groundhog ad jeep did with bill murray late in the fourth quarter >> i didn't see it. >> late in the fourth quarter. back to ground holi groundhog dm favorite movies, what breaks you out of getting from this day get away from me what does it, he finally sees a jeep and that breaks him out of the same day again and again, steals the groundhog and takes off with it. i thought it was well played because it was such an iconic movie with an iconic brand. >> my favorite, did you see the cheetos ad your fingers are orange and you can't do anything, basically i can't help you with anything at any point because i have -- >> with m.c. hammer's "can't touch this". >> hilarious. >> i don't know if we have it. do we have it? did we find the best tweet of the entire -- for aour audience do we have the best tweet? jeff bezos' tweet. here it is, guys, i took an dna test, turns out i'm lizzo's biggest fan. it's one of her hit songs. >> do you need me to sing it yes. actually, no. >> i won't sing it. >> please, do. >> i like the first big hit about flick your hair and show me your nails. i love that. >> that's the lyric. the lyric is, i just took a dna test. >> very good. >> i'm not related to the vikings or something like that. >> in the song, yes. >> see, even he can get star struck, which i like back to they're just like us we were talking about "us" stay tuned you're watching squawk right here on cnbc. magazine and i was getting hell ♪ for reading "us" magazine. >> instead of "people" >> all of them >> whatever's available. >> it's like a little bonbon. when we return, ryanair with new earnings out overnight and ♪ boeing with details on the 737 max. we'll talk about the next and new tax plan from presidential ♪ candidate michael bloomberg. he wants to attack the wealthy but in a little different way. back in a moment ♪ ♪ ♪ don't get mad. get e*trade, dawg. through the at&t network, edge-to-edge intelligence gives you the power to see every corner of your growing business. from using feedback to innovate... to introducing products faster... to managing website inventory... and network bandwidth. giving you a nice big edge over your competition. that's the power of edge-to-edge intelligence. goodbye fred. 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max. phil joins us now. he has more on that front. phil good to see you. >> good to see you, becky. first of all all the conference calls are great because he's incredibly blunt in his assessment of the situation and the industry they did swing to a profit of under $98 million and even though their growth expectations in terms of when they hit their passenger growth targets has been pushed out a couple of years because of the max, well, michael o'leary says the max is going to be a movable feast for good morning welcome back to "squawk box. them take a look at u.s. equity >> the max, we won't have any futures at this hour after a weekend --super bowl weekend, and yet you're going to see clarity until boeing gets the green here aircraft in the air. you're going to see red in and i think that would be more china. we'll that you can about the distinction in just a second an opportunity into fy 20, looks like the market's rebounding in the united states. dow looks like it would open up summer of 21 103 points higher. nasdaq looking to open up 44 points higher. as soon as we can take the aircrafts we will take them because they will reduce our s&p opening 40 points higher unit and they will widen the cost gap between us and all the the china down 8%. other aircrafts here in new but the markets have been closed for a week, which explains a lot york. >> like i said, love the candor of what is happening there of michael o'leary that's going to be a little when you look at ryanair, think squaring the circle for investors this morning we're trying to understand how of them as the southwest of one market could be going so europe they fly an all 737 fleet. badly in one direction and one their order book is 210 planes in the other. ryanair says it may have to push back its growth plans up to two years due to delays in first dlif ri expeelivery expec deliveries of the boeing 737 september or october max. fill lebeau joins us with the they do plan to order the latest with this ongoing saga. stretch version of the 737 max good morning to you, phil. >> good morning, andrew. ryanair ceo michael o'leary wrapped up his conference call with analyst michael o'leary said they expect as we show you shares of ryanair. they posted a solid profit for it several recertification of the the third quarter, under $100 plane and they are the first million. it's the comments from o'leary ones to admit this is dependent people are focused on. largely on working on the faa ryanair was supposed to get its first 737 max back in may of and with other regulators. last year. >> now, i heard you made some it's not going to get it until october of this year comments on the conference call that's the expectation at this and also about the coronavirus. point. but michael o'leary thinks this >> they don't expect it to have delay ultimately could work to an impact in terms of travel ryanair's advantage over the within europe and that's the next several quarters. similar sentiment of ceos here >> i'm going to sit down with in the united states and in boeing, we do the schedule, north america. in terms of people coming from delivery schedule based on what they will achieve and update our china and asia over the europe and over here to the united market with traffic growth at states, certainly it will but in that time. what it means certainly for this terms of traffic within that year and next year is slower region, within europe, michael traffic growth that's probably good for o'leary says they expect to see underlying yields since we're the one who deliver -- we're the strong travel demand not only within ryan air but in europe owner that grows most and and other airlines. >> it's good to see you again. fastest in europe and there's probably upward momentum in our meantime we want to talk more about the impact of the favor and less capacity pressure in europe. industry and want to welcome the former >> take a look at shares of boeing, keep in mind that ceo. >> also an american airlines ryanair has 210 737 maxs it has pilot with over 30 years of flight experience. ordered. michael o'leary saying a few he is a spokesman the next day miss ago they also plan to order several 737 max-10, the stretch version of the max they haven't officially placed that order yet but at some point they will. so, fairly positive comments, guys, from michael o'leary regarding the moves boeing has they suspended flights to china. made to get the max back on thank you both of you for being schedule altima thely certified it, perhaps bit middle of this year. here let me start with you. and then back in service >> phil, does that surprise you to hear it might take two years we want to start with american for them to get the delivery of first of all do you think that the suit is some of these planes or it's what forced this issue and what was happening behind the scenes? expected, that's the math when you shut down production >> well, clearly we were left >> correct that is what was expected. look, they have been pushing with no other choice this out three months at a time, three months at a time i think michael o'leary, as well on thursday, cease and desist flying to china to protect our as other airline ceos, feel a passengers several hours later the state department came out and covered little more comfortable with the current schedule that's been set china in a do not travel zone. up here. there's a little flexibility shortly after that compliments built in there as boeing works to the white house for its with the regulators, the faa and leadership in taking decisive action to contain this virus europe and other regulators around the world the fact they have to stretch unfortunately, what we learned out how long it will take them over the weekend is that while to get to their passenger we were very pleased and proud target, becky, i think that's pretty much what people were of american for putting people expecting. they certainly were expecting it was going to be at least a year, over profits and taking down the year and a half. china flights we learned that so two years is not a huge stretch for people to understand, at least the they may be bhong kong. analysts >> and, phil, what did you just hear in terms of the hong kong is colored yellow, a relationship boeing has with its gold color as we prefer to look customers, these big airlines at at it. this point we're very concerned over that >> well, it's fragile but and american right now said they improving. and it certainly has improved are considering reinstating hong under dave calhoun has new ceo you have him as ceo and then ko larry kilner, former ceo of continental airlines, who is now kong. >> take us behind the scenes the chairman of boeing they made a concerted effort what is happening? since dave calhoun was put into what are you telling american about what you wanted last week the ceo position to work closely before the lawsuit with the airlines to say, look, >> on tuesday, our president we understand the position you're in. here's what we're doing. went directly to senior much better communication than management and said let's take a there was in the past under pause and there's so many dennis muilenburg. flights going through here i've heard that back from let's get a few days off on this airline executives they feel so we can gather our senses. more comfortable dealing with they heard us. dave calhoun and boeing than they were respectful but they pressed on with the they did, say, three or four flights and so that's why months ago. thursday our president and the >> phil, thank you. when we come back, we'll leadership of the union behind take a look at the energy him took this step and we did it sector's big drop in response to the coronavirus. with venezuela but we'll always and news this morning be that opec may try to step in to put our passenger safety -- >> do you think they were to compensate we'll cover that next. stop the flights without your this morning the s&p energy index down 3.2%. lawsuit? >> we'll never know. later, is the worst over for but the bottom line is they have uber made the right choice. the stock's had a rough ride they need to make the right choice on hong kong right now. since its i. >> gordon, you're listening to o last year but it's bouncing back we'll have the full case on ride this do you think they should shutdown the hong kong flights sharing. a reminder, you can watch or listen to us live on the go on too? >> they need support the cnbc app we'll be right back. when we started our business it's incumbent on all the employees and airlines to get along and workout what they're going to workout i think they're going to do whatever the government allows them to do and may, in fact, do less than that but i don't see where our government is going to open up china any time soon. >> what would you do in this instance less than the government wants or more? >> i am saying that the government may open up uninhibited and he would be left because of your con serns. how much of it is long-term? anyway to measure it anyway to guess if you were inside the corner office of an airline right now? what kind of work would you be doing. >> at the same time, you have to deal with the facts just like major snowstorms or whatever, they're going to hit your income statement and you can monitor and expect some of those this is open ended and china such a vital trading partner and so much of america that you have to get solved. >> what did you think when you we were paying an arm and a leg for postage. heard of the decision stop all i remember setting up shipstation. flights from china when you were one or two clicks and everything was up and running. sitting there? were you shocked were you surprised i was printing out labels and saving money. did you think wow it's going to hurt the bottom line on all of shipstation saves us so much time. these airlines in a very big it makes it really easy and seamless. way? what did you think pick an order, print everything you need, >> well, i thoughtit was the slap the label onto the box, appropriate thing to do. and it's ready to go. you stopped climbing the our costs for shipping were cut in half. airports and the government shut just like that. shipstation. the #1 choice of online sellers. the airport down and it's not up to you so i thought that was the thing go to shipstation.com/tv and get 2 months free. to do. it puts everybody on an even playing field but most importantly it inhibits the spread of the virus to this country. >> right we just showed a graphic about when traffic has been stopped until delta and i was going to ask what you make of that. >> well, each company is going to make its own decision but he just mentioned how important china is to us it is and that's why we have to take roactive steps to stop the spread of this your two doctors that were on encouraged your viewers to watch that they cut right to the chase and in hong kong there's so much shipstation. the #1 choice of online se♪lers. uncertainty, that's not a safe zone it is the cdc has it as a ♪ threat. >> thank you guys. ♪ appreciate it. >> still to come, key stocks making moves ahead of the opening bell plus safe havens for your money as the coronavirus fears shape markets around the world right now let's give you this reminder you can always watch or listen to us live on the go on e thcnbc app. stay tuned you're watching squawk box on cnbc >> announcer: today's big number -- 19.2%. that's how much the s&p oil and gas exploration and production etf, the xop, fell in january. that's its worst month since september 2011 welcome back, everybody. let's focus now on the impact of the coronavirus on the energy markets. just this morning reuters reporting opec and its allies are considering a further oil output cut because of the impact of the outbreak on oil demand. at comcast, we didn't build the nation's largest gig-speed network just to make businesses run faster. they're considering holding a we built it to help them go beyond. ministerial meeting ahead of the next scheduled meeting in march. because beyond risk... let's take a look at the energy welcome to the neighborhood, guys. there is reward. sector in the midst of this ♪ ♪ market selloff joining us for that right now is beyond work and life... who else could he be? rob, tortoise portfolio manager. there is the moment. beyond technology... there is human ingenuity. rob, obviously, we've seen a ♪ ♪ pullback because of the coronavirus and the demand every day, comcast business is helping businesses picture, what that's going to go beyond the expected, to do the extraordinary. mean for the second largest economy in the world do you think that pullback is take your business beyond. warranted? >> well, oil prices declined probably 17% year-to-date, ♪all people, all people, all people are tax people♪ becky. typically when oil prices fell, ♪if you filing by yourself let me see it clap it up♪ so does the energy sector. but we do see the energy sector ♪clap it up, clap it up ♪if you got a question to ask a cpa can help you there♪ at tortoise in evolution and it's moving beyond oil and there ♪help you there are opportunities to make moil ♪got a w-2 go ahead and wave it in the air♪ in the energy sector that ♪wave it in the air doesn't involve investing in oil ♪now take a picture prices. >> like what ♪easy upload is a mobile feature♪ >> well, so longer term the -- as the energy sector evolves, we ♪all people, all people ♪all people are tax people see a combination of natural gas and renewables combining to intuit turbotax reduce carbon dioxide emissions. everybody hates the energy sector because of carbon emissions. in the u.s. it's been proven if you combine fossil fuels, specifically natural gas, with renewables you can reduce carbon emissions in the u.s you take that same formula and apply it in places like china and india where they use a lot more coal, that's a recipe for success. so, companies that are doing that are companies like shenere energy, the best way to play l&g or liquefied natural gases to places like china. they will significantly grow their cash flow over the next several years as demand out of china for natural gas rises we're just an hour to the significantly. >> can you talk about oil at opening bell on wall street. all? what do you think when opec says dom joins us to sum up this they might do an emergency cut as soon as this week that's morning's biggest movers. >> shares of exxon mobil are going to help stabilize the price at all >> yeah, that's important. down three quarters of 1%. roughly 60,000 shares of premarket volume the biggest thing in the oil that's due in part to analysts price or in the oil market is at goldman sachs that downgraded the shares to a sell rating. global oil inventories it wasn't neutral. what we've seen in the past, if it got cut to $59. inventories rise, prices fall. opec knows this. cited reasons including a lower they're watching this very closely. because of the demand less in view of where oil prices go from china right now because of the coronavirus, you'll like will he here and refine products as well. also the relative elevated see invin tonerientories rise. valuation so those shares on the down side from now if they do take some action, up next shares of uber around obviously that will stabilize oil prices from here. >> we had a conversation on 1.5% at this point friday with jim cramer who says 125,000 shares of premarket he thinks nobody should go near any of these energy stocks because it's not going to be a volume place people invest. and he put the stock on his best he called it basically the new cigarette stocks $50 price target there you have portfolio managers, especially pension funds, who won't be willing to invest and monster beverage about 2.5%. because millenials don't want to invest their own money in fossil fuels. what do you say to that? >> yeah, well, jim is a legend premarket volume and overweight and has great opinions all the by analyst morgan stanley. time the target price goes to $78 what we would say at tortoise to it was $70 and they called it a top pick revenue growth in the u.s. and that, fossil fuels are hated because of the connection with international. potential profit margin rising carbon emissions. it's not either or expansion and relative to it it's not invest in fossil fuels or invest in renewables. back over to you. >> dom, thank you. it's an and. the markets pulled back sharply invest in fossil fuels and on friday here in the united renewables you put that combination states over concerns about the together, it's very powerful coronavirus pushing the dow to it can reduce carbon emissions the worst week since early if you displace coal with august when this reopened this morning stocks in china fell hard. renewables, you can reduce carbon emissions. this was the first time they >> the question is whether this were trading since january 23rd. larry fink view of the world is we're looking at the nasdaq and going to mean that all of this the dow and u.s. markets here is just dead money by the way, it's been relatively but if you were looking at what happened in china you'd see dead money for the last decade if you were to compare it to the moves of down 7.5 and 8.5% frr s&p 500 or something else. and whether there's something the shanghai and shen zen else going on in terms of the markets. psychology, as becky and cramer shaking off some of the virus fears or at least giving back were talking about on friday, that there's something -- that some of the ground that we lost there really is something in the on friday. joining us for a look at where water, if you will, in terms of the markets could be going on how investors are thinking about this this news ise senior market >> yeah. strategist at lpl financial and well, andrew, the way to think you say this volatility was about it -- the way we're thinking of going forward, from an energy sector perspective, the energy sector and utility overdue. >> hey, becky, thank you sector and renewables will glad to be back. we don't think so. become synonymous. i was on two weeks ago with joe. they'll become one sector. rather than focus on oil and gas producers where there's a lot of be on the look out for commodity price exposure, a lot volatility of volatility, focus on the we went until 1955 two days in a demand, the users of the energy. row. energy is essential. over three months without so we all need it. much as a 1% move up or down >> i'm want disagreeing. i'm just wondering if investors now three 1% moves we think as will give credit to that because we get into the historically certain investors that clearly troublesome month of february we don't want to. >> well, that -- that's true won't be shocked at all if this but if the energy sector can pull back in volatility deliver the cash flow, right, so continues. we're all blaming it on the we're not tobacco stocks coronavirus but we think the energy demand is not going down. market is ready for volatility 25% of people probably smoke dou tobacco. >> we had mohammed on about 45 i don't know the statistic but everybody needs energy minutes ago. he said at this point he thinks more and more energy is being this is different than any of the others we experienced to consumed every day less and less tobacco is consumed every day date high dividend yields are he said this is the one thing important, especially in this that he would say okay time to environment when the treasury is step back and take a pause at 1.5%, ten-year treasury what do you think? >> we wouldn't disagree totally with that right? you can get them in magellan, it's the uncertainty but at the end of the day when well covered dividends, growing we look to all the pandemics and dividends, companies that operate essential critical assets >> i wonder if they eventually epidemics the bottom line is the economy stays strong all go private, right, generate it still is. enough cash flow, buy back the we could have more of a pull back but we still think that's stock and you don't have to hassle with the big markets. the area >> even the -- >> you go back and look at oil prices when they were very, very high and how much cash they were generating, a lot of them could >> let me expand on what he go private. said >> exxon has a market cap of - his concern is that the central banks will step in he's already seen that happen >> no, but a lot of them may be with china and the expectations forced to make this choice here in the united states is that the us. fed will also do rob, thanks for joining us today. we appreciate it >> thank you that too when we come back, $5 his point is that this will be trillion in ten years, that's the time. how much michael bloomberg aims to raise under his tax plan. >> well, it's different. we don't truly know that but we'll tell you how he plans to get to that number next. you're right just a couple of months ago no this is excitement. one expected the fed to cut and now it is pricing the short end of the curve is inverting and when you look at earnings we're not naive to those but we still see an economy with 2% earnings this year. grow 7 or 8% and that could with stand a lot of potential neg tiffs. >> if the coro nrka -- coronavis wasn't happening, do you think that would have impact on the averages as we move forward here >> his percentages could hurt yields a little bit. and we also talk about the super bowl and the chiefs last night that's what we're focused on and into the election the bottom line is, you know, focus on that don't forget, the stock market when you have a president up for re-election has not been down since 1940 that's something that you should not ignore >> brian, aside from the cyclicals. >> new we really like the industrials some positive news on trade. we are equal weight tech tech was up 50% last year. earnings this year, tech is well we are literally going to hogwarts right now. earnings emerging markets, i'm fully aware what's happened the last this is unexpected. week or so we really think we'll avoid a global recession and emerging markets are cheap, 14% earnings ahhhh! whoaaa! [exasperated sigh] growth in emerging markets, this is incredible. double what we should see in the u.s. the pull-back looks tasty for we just got off hagrid, and it is by far the best ride... e.m. as well >> ryan, thank you, great to see this is universal... [visceral laugh and scream] you. >> thanks, guys. stocks on a roll this home of tripadvisor's number one park in the world. earnings season with facebook, so come join us. amazon, apple and netflix get our third park free and enjoy all three parks from just $53 a day. restrictions apply. beating on the lines joining to us talk about what investors should be looking for in this -- is this by the way, this is first earnings without larry page in that spot. john friedman is here, vice president of equity research at cfra what are you looking for this afternoon, john? >> so you know, we're definitely looking for you know, e. s of a little more than $13. consensus is about 276, 1276 the google cloud business has and if over and going to start to drive more and more earnings for google and more expectations of future earnings and therefore everyone is going to i think going to pay a lot more attention to the cloud and last week, we had microsoft's azure came up with 62% growth year over year. it is the number two cloud infrastructure cloud provider behind amazon and google is right behind microsoft and we think that that can be contributing 15% of revenue by 2021, and is probably one of the main reasons we upgrade google to a strong buy and increase the price target to 1743 i believe is what we have. >> where do you land on youtube? welcome back to "squawk box" >> youtube, what's frustrate this morning the nominating contest for the being youtube is it doesn't get democratic party getting under way. it happens today broken out but no, it's one candidate not included in certainly he growing and the iowa caucus is making a lot profitable, and i think the of news with his tax plan. averages in general i think is doing well i don't think there's a lot of robert frank joins us with some of the details of michael variability, but i don't think bloomberg's newest proposal. they're going to miss by a lot what's going on? or exceed by a lot but i think >> good morning, andrew. they can on the cloud side michael bloomberg's tax plan would raise $5 trillion over ten i think some of their years, mainly from the wealthy acquisitions were pretty and companies, to pay for his interesting, app sheet and education, health care and housing programs looker, both sort of can add now, the plan is more than 50% value-added services on top of higher than joe biden's but less sort of the generic me too, we than a quarter of the totals of have a cloud service, too, buy those by some compute >> you're saying it's finally happened they've been throwing spaghetti at the wall for a very long time, cars, et cetera, all these different things, self-driving irjts it would add a 5% surtax cars, et cetera. they were every time you read that earnings report, they were on those making 5 million a year an advertising company, made their money on advertising but so the top federal tax rate finally getting to the point where the diversification of the would be 44.6% he would also raise the revenue will be strong enough you no longer say they're not corporate tax rate to 28% and dependent on just that one this is the biggest change, tax tell me about the revenue from capital gains the same as one versus the other ordinary income for those making what debts the better mull tipple what's more important? over $1 million. >> i think the cloud should get the better, get the better which means if you have a capital gain selling a top stock multiple, because it's not only, you know, growing well over 60%, it would go to the very wealthy 50% that, kind of sort of year 44.6 it would be 56% or more if over year growth but it also has you live in new york and oracle a high degree that cloud business has and we've seen it before it has a high degree of what i cal. he would also end the step up in call inherent operating leverage basis when unrealized gains are in the business. so it's not only, you know, it's not taxed after death and then even already starting to contribute to profitability and he would also change carried i think by 2021-2022 it will be interest your favorite and he would a very material driver of earnings >> okay, john, we will look for expand it. >> he's hitting a lot of the the numbers this afternoon, and issues that i have talked about. we'll talk about them, i'msure i have talked about the carried tomorrow morning thank you. >> excellent, thanks for having interest stuff me take care. estate tax stuff let's get to jim cramer, it's a marginal tax rate on the getting ready for the show at way up the new york stock exchange. so it's not 20% all the way up jim, want to talk to you first about coronavirus, whether it's to 44 for something. changed over the weekend, what >> it's the income. you think kind of reading into >> it's money as it goes up. all this particularly when you >> in any other election year if watch shanghai and shenzhen close down so sharply when they you din have two people proposing wealth tax this would first started trading. >> i think you can't ignore what the markets are saying nor you be seen as a fairly extreme tax can ignore the concept of the plan and suddenly we're looking multiplier effect. i think there may be more people who don't get sick than sick so at 5 trillion in government i don't want to put too much spending as moderate by the way he thinks it's emphasis on this 2.5 number, 2.6, but i think what does unconstitutional it's not that he thinks it's not matter to me is that they don't fair seem to be able to contain it in he thinks it's unconstitutional china. i think that you're going to get and wouldn't stand up in the courts that's his argument. >> it would hit disproportional news out of china muted. the only person i trust is someone from cnbc eunice yoon. too. >> a trillion in ordinary income i worry for her health or a million because you sold what can i say she's over there something or a combo of both or look, i just think you have to wait and see, but i don't see do we know >> it's a million in ordinary this as a big buying opportunity like a lot of people are telling income but your income if you sold something would be more me let's wait and see i just think it's too influx than a million dollars because of cappel at a gains. it's too dynamic >> and what was surprising about this to me is you add in that 5% >> david's there today i guess you guys are probably sir tax you're talking about if going to talk about bernie evers a little bit, the famous you live in new york orac interview, bernie evers passing away overnight or california, you're talking >> yeah, 78. i remember david's interview about 56% or more just in the capital gain part of that which it was to me the moment that is a huge jump from 20%. made you realize that there's >> i guess you're not -- he's not going to be this telco not talking about reimposing. explosion, not all these companies -- they won't come >> biden would reimpose it back and didn't come back for a decade but it was also the he would get rid of that and go notion of the authorities were back to where we had it but no longer viewing these things bloomberg is saying no because as white collar crimes it's expensive. >> that's right. you went to prison, that's >> it's very interesting because he's the guy that pushed the right. >> and we just talked to an analyst about google, parent rezoning so that as many billionaires as possible would alphabet what are you expecting this afternoon? >> well, i've met thomas kur move here curryian, the google of their google service everything the analyst said is dead right they're making a serious attempt. we know from the other guys there's a ton of business to do, so why can't google get some of it i think they can tell a positive story. when ruth porad is on, she's so we want to bring in a guy with a fabulous, she can say we're making some progress here. maybe they're conservative but strong view about why this is a they're making progress and i think that analyst will be right >> jim, thank you. bad idea great to see you >> thank you, guys >> we'll see you in a few minutes. later this morning, don't miss a special interview with paypal i will ask you this. co-founder max levchin at 11:45 a.m. eastern time. at some point we have to try to stay ted "squawk box" will be right back. pay for them somehow so the question is how. at fidelity, online u.s. stocks and etfs are commission-free. >> first of all, the republican goal is to reform entitlements rather than to figure out how to pay entitlements that will bankrupt the country and double the size of the federal government if we don't do anything over the next 20, 30, 40 years so let's reform that spending as clinton did. i think it's healthy for the republic that bloomberg was forced to put out actual numbers. this is very scary these are jimmy carter level of capital gains tax and we know what that does to the american economy. we have seen this before and when he says he's only going to hit rich people remember the personal income tax put in in 1913 we were told the top rate was 7% and only on people in today's dollars making over $11.5 million. you shouldn't worry. it's just guys making $11.5 million. when you hear of the numbers that sanders is going to put in wealth tax on anyone that has more than $32 million. bloomberg is going to have a super heated capital gains tax on anyone that makes a million and when you open a new brokerage account, your cash is automatically invested at a great rate. dollars in a year. those numbers won't stand. that's why fidelity leads the industry in value while our competition continues to talk. ♪ talk, talk >> you tried to equate this with carter the other piece of it is the function of what was taking place during thiz administration and i'm not sure that that was while our competition continues to talk. the number of uninsurising.ricans, the cost of prescription drugs, rising. the threat to people with pre-existing conditions, because of taxes at that time. rising. the good news, no >> well, every time we reduced so is support for the one candidate who'll do something about it. the capital gains tax we have as mayor, mike bloomberg helped seen rev knew increase and the expand coverage for seven hundred thousand people, economy do better. when we increased the capital including hundreds of thousands of kids. including hundreds of thousands of kids. as president, he'll lower drug costs and gains tax we saw projected ensure everyone without coverage can get it. revenue fall and the economy do that's a promise. less well. and unlike him, mike actually keeps his. so we have a pretty good track i'm mike bloomberg and i approve this message. record it's never moved the way it's one of the most destructive dana-farber cancer institute discovered the pd-l1 pathway. kaxs of economic growth. pd-l1. it doesn't bother people already they changed how the world fights cancer. rich like bloomberg. blocking the pd-l1 protein, >> this idea that the capital lets the immune system attack, gains tax could effect the every attack, day american attack cancer. 80% or more of capital gains pd-l1 transformed, revolutionized, income goes to the top 5%. immunotherapy. pd-l1 saved my life. so by nature, capital gains is a saved my life. saved my life. what we do here at dana-faber, changes lives wealthy source of income everywhere. everywhere. everywhere. everywhere. everywhere. but it's going to hit the top. a final check on markets, a half hour before the market would open, and seems to be some resilience here despite -- >> considering shanghai, would it's unconstitutional to tax you think -- right >> you'd think the news in china and the way the market's reacted wealth but you can tax the people that you think are there, though closed for eight wealthy as high as you want and days, we have red arrows by the you can create a wealth tax using the income tax way there at 8% pretty much that's what he is trying to do across the board his plan is extremely radical. the dow would open 130 points it suggests even a business man higher, nasdaq up about 60 points and the s&p 500 up as doesn't have any guard rails on well how far left they can go on it looking at green arrows across the board there as well. on a tax increase like this. goes to the whole question of what should have happened? terms of how the chinese market the idea of promoting other should or should not have reacted. maybe that's fair. people's stuff is a very >> there were so many stocks european attitude that went down but i wonder what happens when they start opening tonight, when they open up again for trading. >> oil overreacted, saudis might cut half a million barrels a day. >> up 13 cents the last time i saw. even with the news tells you the united states is the real mover. >> michelle thanks for joining us "squawk on the street" is coming stocks in china reopening and up join us again tomorrow selling off shplary. ♪ we get to see kc chiefs make we'll dig into the global market action next. 'em taste these cleats ♪ ♪ welcome to the red kingdom >> super bowl champion kansas city chiefs and coach andy reid. welcome to "squawk on the street". i'm carl quintanilla with jim cramer and david faber at the new york stock exchange. we're coming off the worst days since august for the dow, futures are up chai that stocks reopen and the central bank adds the biggest cash injection since '04 oil below market alert chinese stocks plunge. but u.s. equity futures are bouncing back from friday's major sell off. >> what's an investor to do? the best ideas for protecting your portfolio in times of market uncertainty, straight ahead. >> plus your money, your vote as iowa prepares for caucuses tonight, mike bloomberg is unveiling a $5 trillion tax plan the second hour of squawk box begins right now. joe is off today our guest host this morning, we have michelle. >> always a pleasure. >> former cnbc international correspondent and board member and what other great -- >> i make an occasional speech, yeah. >> meantime, take a look at u.s. equity futures we have some green coming up after the super bowl weekend but after 8 days of the market being closed in china, you're going to see red arrows in china. we'll show you that in a second. s&p 500 can open up about 15 points higher. the nasdaq looking to open 49 points higher. >> let's get you caught up on the headlines at this hour the market impact of the coronavirus was evident it's seen in four years and the death toll of the coronavirus with the total number of cases at 17,500. virus fears are keeping gamblers away from the world's largest gambling hub it fell 11.3% from a year ago and the revenue decline could reach as high as 30% and news out that apple is shutting down all of it's stores and corporate offices in mainland china. it's taking the action out of an abundance of caution we'll have more on that story and the impact of the stock in a little bit. >> meantime, global investors have been caught in a slow down this is a one year chart you see this up trend was broken in the short-term that we had since october. nothing too critical yet actually if you want to look at the 50 day average it's down around 3213 maybe another warning sign so obviously a gut check but not too much more. so it means yields are going lower we're still above that and what that means is that corporate credit spreads were tighter than they were then so not as much concern being shown in the corporate debt market that's the net positive and then the volatility you're seeing a couple of spikes on this chart but not as high as back in august usually you want to see spikes and a lower spike and something that goes down and shows you the fever has broken right now we're on alert and it's still in the zone of some what normal pull back even if it's seemingly from unusual causes guys. we had a call -- i don't know who was on in the 5:00 hour this morning saying pull back. in the u.s. it does not seem to be saying that what do you think? >> i think from a bond managers perspective it's getting cheaper. we have seen the ten year treasury go from a 190 to a 151 and now back to 154. it's allowed us to fill out positions just four weeks ago. but positions that looked expensive have cheapened up a little gaming is something that we like to invest in we like the consumer but the single biggest gaming space is macauw so a small exposure to mgm and things like galaxy and las vegas sands and wynn with exposure there. >> i think the big question is how long does this last? do you want to be more defensive in the interim absolutely but the big question investors are grappling with today is how long does this go and what's the broader impact on the global economy and the pmis mean nothing because the surveys were done before all of this began to gather steam. what has been given me more pause is this divergence between the survey data and hard data. people are looking at that to catch up and it further impedes the equity market. >> that question about how long it goes on for it, if you looked back at these other things does it give us any clue as to what might happen >> everybody has kind of built the model for saying here's what we'll know because here's what we knew when you basically saw a little bit of an inflection and slow down and all the rest of it i mean, it just doesn't seem like it's a clean comparison to where we were now which was a market at all time highs two year highs in valuation sentiment. we needed something to take the froth out of the market. this came along to do it. >> meaning that it's such a different market position because there's such a long way further to fall or because you still have optimism that we'll keep things afloat >> i think you were ready for a correction no matter what almost and the argument is that if this is not an economic event in a long lasting way then i think the market is probably in decent shape but i don't think anything gets us out of this late cycle psychology even though it's not necessarily over it's very easy for the markets to flip back into yield curve is flat. it must mean something bad is happening. >> you had moderate growth and trade and for a long time we have been talking about how it's difficult for those things to co-exist and arguably the most important thing is what is going on with earnings and more importantly what does guidance look like for 2020. >> that's the problem. the guidance of so many of these companies is we don't know. >> we don't know and the big issue from where we sit is you have consensus still pencilling in this 10% number our models are saying 4 to 5 the cushion that we have isn't what it was earlier in the cycle. i think we're in for some volatility. >> are you calculating these could go down another x percent? >> it was the bond market. >> so i was going to ask you that, all the names that you mentioned you're buying the bonds? >> buying the bonds. >> i'm a relative value guy. is it transitory or -- we have already derisked our portfolio last year it makes sense >> no, no, we would agree. you need to pick and choose your spots. but latching on to what you were also saying earlier you were finding a lot of value in things like consumer loans and things of that nature >> let's just talk about what happens for some of these companies because with most of the guidance we have gotten to this point is closing stores through february 9th but i don't think anybody really thinks that's the end date for any of this i don't think you're going to have your arms around this in less than a week's time. >> i don't think anybody feels like they have it under control in terms of knowing what the magnitude is the market is racing to this point where it says we can write off first quarter growth we're going to have to push this out. whatever trade piece dividend we thought they were collecting it's deferred now in terms of growth and trade and all of a sudden the chinese are going to come up with massive monetary stimulus so that to me is the playbook that already people have grabbing for. >> is the ten year yield already caught up to this idea >> the short end i would say is pretty close to that more than one this year. >> i would agree with that our range on the ten year is 1.5 to 2%. we started with the 190 without the 154. china has already come in. they are doing the right thing on the monetary front and around the world, central banks are still very accommodative. are you able to take advantage of opportunity. >> that's interesting because everything i read over the weekend, the sell side hasn't really budged. oh, the reinflation trade isn't over it's just simply deferred further into 2020 so i think how long are investors willing to look through this and say i really think that global growth bottomed and we're going to see this rebound in profit and growth and cap ex which may be more challenging. >> you have people getting hedged all because of the democratic primary so we're going to hold but we're going to hedge now the hedge also works if it's because of coronavirus but you also get into the election mind set and wait and see fort. >> when we return, as coronavirus fears spread around the world, so does misinformation we'll talk about the role of social media next. first as we headbreak, let's take a look at oil prices this morning we have been hearing reports that opec and it's allies are considering a further 500,000 barrel a day cut for oil this comes as demand for crude falls amid the coronavirus outbreak right now up about 17 cents. stay tuned you are watching squawk box right here on cnbc beyond the routine checkups. beyond the not-so-routine cases. comcast business is helping doctors provide care in whole new ways. all working with a new generation of technologies powered by our gig-speed network. because beyond technology... there is human ingenuity. every day, comcast business is helping businesses go beyond the expected. to do the extraordinary. take your business beyond. good morning to you. >> good morning. there's a reason why we describe this kind of information as viral. the world health organization is warning that mission information about the coronavirus could prove physically dangerous drinking bleach could cure the virus and others had racist undertones and that's forcing the major tech forms to step up their efforts to combat bad information. facebook is making sure that credible news sources are at the top of your news feed and restricting certain hashtags and taking down content that discourages treatment and tells people not to take appropriate precautions. google created an sos alert and includes the latest news articles and links to the who. mewhile, twitter is halting automatic search prompts misleading and creating it's own dedicated prompt that's not all even tiktok has to fight misinformation a notice now pops up to remind users to verify facts with trusted sources. so big tech is facing criticism that it isn't being aggressive enough the congresswoman sent letters to executives at all four companies and it says much like this virus, misinformation will continue to spread until measures are taken to limit exposure and treat the symptoms. so this just gives washington one more store stone to throw at big tech back to you. >> it occurs to me that the tech companies are caught in a pickle here if they do comply and go ahead with it it proves they can stop misinformation >> what they'll say is the steps that they're taking is part of the existing policies. so facebook already has a policy that it will remove content that insights harm and encourages people to do harm to themselves or do harm to others so this is part of that policy and they can sort of point to that as saying we have already tried to address these types of issues the good news if there is any is at least twitter is saying it has not seen any significant coordinated disinformation attempts to spread this type of information so these are sort of more one off rumor mill conspiracy theories getting out there but they convenient any type of raw scale effort to see this information to the public. >> my point is that if they can combat this, they are more like a news organization than they are a bulletin board. >> if they want to do it, they can do it. >> part of the difficulty around, for example, the political ad question is that the grey area is larger. i think in a crisis like this where there is clear concrete information coming from trusted sources like the world health organization makes their job easier it's easier to say we know dr k drinking bleach is not going to kill the coronavirus where it's much more difficult. they're also facing a lot of questions tonight as the iowa caucuses get underway of how they're going to address misinformation and disinformation on the platform so those two efforts are happening in parallel but i think that the coronavirus information is much more clear and the lines are much more black and white. >> thank you good to see you. when we return, presidential hopeful mike bloomberg unveiling a $5 trillion tax plan we have the details and what this would mean for companies and investors next plus the jeff besos tweet everyone is talking about this morning. stayun ted you're watching squawk box on cnbc mike bloomberg isn't competing in iowa but his tax plan is getting a lot of attention this morning he says he would unwind corporate tax breaks put in place by president trump and imposing a 5% sir tax on incomes above $5 million a year. that was also attach captain gains and carried interest and got you on the estate tax as well in terms of the step up >> that would be 56% or higher. >> at thetop. >> and robert frank pointed out that he said bloomberg isn't necessarily against the wealth tax but he doesn't think it would pass constitutional muster and that's interesting because he's one of the wealthiest guys in the country. >> i think it's constitutional. >> i don't think it's for that reason hough. >> a wealth tax i think is incredibly difficult to figure out how you would go about calculating that and staying on top of it. it seems like there would be all kinds and he's going to have a hard time saying wealth tax is unconstitutional diminishing returns. if you take 10% of somebody's wealth and 10% the next year but you start to really, if that principle doesn't offset what you have taken, there's nothing left to take. >> money finds ways around. >> beyond that. >> jeff besos is being sued by michael sanchez, his girlfriend's brother he is accusing him of defamation saying they spread false news to news outlets and provide graphic nude photos of besos to the press. a lawyer provided a statement on her behalf saying michael is my older brother. he secretly provided my most personal information to the national inquirer. it's a deep and unforgivable betrayal michael sanchez denied leaking the nude photographs besos's phone was hacked by an account associated with the saudi crowned prince. >> when i saw that story i was like was he the one that actually leaked the photos but they still think it's her brother. is that what the lawsuit is about? >> the strange part about this whole story is that it's clear from all of the forensic reporting that's been done that the brother did provide information. >> he admitted it at one point. >> that's why the lawsuit -- >> he said maybe not photos. at one point he admitted he had given some texts but he didn't provide the photos. >> the allegation against him and then there's issue like a soap opera within the sanchez family about whether they're close now or -- it sounds like the whole family is completely split. >> what's the opening line of anna karenina again. all happy families are happy in the same ways and all troubled families are troubled in the same ways. >> did you see his tweet last night? he was at super bowl and here he is he got a chance to meet lizzo and sometimes you can be star struck he said i just took a dna test turns out i'm 100% lizzo's biggest fan. does everybody get that. >> we're probably not allowed to play the music because of copyright issues sing it. >> maybe in the next hour i'll do a little singing. you can sing it. you can sing it. still to come on squawk, me singing lizzo's song plus apple closing all the stores in china amid the coronavirus outbreak. >> don't chase the viewers away. >> we'll talk about the impact on the company stock and all of it when squawk box returns looking in the green after an 8-day holiday there but right here, it will open up about 108 points higher. nasdaq up 44 points higher the coronavirus continues to dominate the headlines the tech giant temporarily closed all 42 of its stores in china. joining us is dan ives it's good to see you. >> great to be here. >> let's talk about what this means. 42 stores. maybe not huge but what is the impact for apple after we have seen starbucks and over 2,000 stores. >> i think between the head ones and the fundamental impact right now, if you look, in china, we're talking about 1 to 2 inch units where maybe this could hit them and they gave a pretty wide range in terms of guidance last week i think the worst case that we see here is about 3% a unit. about a million iphones could move out in the marge and june quarter but at this point, it's contained relative to the fundamental impact i think bark is worse than bite so far for apple. >> you're assuming defferal rmts i look at all of what we said. you almost have to take a step back there's a supply chain piece and a demand piece 20% iphones coming out of china. so at this point that continues to be very strong in terms of 60 or 70 million iphones in china but not a great opportunity. on the supply chain if this goes into mid-late february then this becomes a broader issue. >> it becomes a broader issue because if they can't get the components needed for the parts they're not going to be able to keep up with the drop in demand from >> that's exactly. . think the demarcation line. >> on the retail if you look the vast majority of china is online. >> from a retail perspective even though investors over the weekend are trying to understand the impact is still very small but just like you look at the supply chain, that's the issue if you continues into the next three or four weeks. >> we learned from the trade war that moving supply chains is easier said than done. especially if you're going to be doing it under duress. >> that's the worry. you just got over u.s. china you're starting to pop the champagne. investors are trying to understand the impact. in our opinion on apple we continue to buy in this weakness i look at the super cycle thesis and just look at the map behind the numbers right here. >> there's not a lot of weakness let's look at that chart. >> still trading at 3$307 which is not quite but almost double where it was a year ago. >> it continues to be our thesis that this is just a massive 5-g super cycle so any dips that we see in apple in our opinion like this. >> $400. 30% over the next year. >> i think we sit here december 31st and the stock has a foreign -- >> let's talk about uber you have a call out on that too. you think that the worst is over there. you're adding it to one of your top picks. >> this morning adding it to the top picks. let's just call it like it is. it's been a nightmare for investors in uber thus far since the ipo but i do think dark clouds starting to clear because rationalization and pricing what we are seeing. starting to announce the profitability profile take shape and the main thing is drew brees. as we talked about here this is a fork in the road but ultimately they're going to really have to rationalize that from a profitability perspective. i love the risk-reward ere this is a big first step forward for gaining street credibility. >> can i just ask you -- >> what do you think it's worth? >> in my opinion, $50. >> i think $50 by tend of this year. >> you have been rationalizing though that means what? more sales more places. >> i think if you look the overhang is about a 10 to $12 overhang on the stock. we start to work through that this year and that's why even from a free cash flow potential 5, 6 years i think uber is now the risk reward. i think it's in the rear-view mirror in our opinion. >> good to see you. >> meantime, this stocks to watch and big establish movers you need to noah head of the opening break. plus a reminder, watch and listen to us live and you can do it on the cnbc app stay tuned dana-farber cancer institute discovered the pd-l1 pathway. pd-l1. they changed how the world fights cancer. blocking the pd-l1 protein, lets the immune system attack, attack, attack cancer. pd-l1 transformed, revolutionized, immunotherapy. pd-l1 saved my life. saved my life. saved my life. what we do here at dana-faber, changes lives everywhere. everywhere. 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higher by around just 1.7% roughly 4,000 shares of premarket volume it is getting some help from analysts at jp morgan that put the stock on the analyst focus list of best ideas they also maintained and overweight rating. they bumped it to $111 a share it was $110. a steeper drop than the rest of the market in the last four weeks and it gives an attractive entry point and it's across geogra geographies so those shares about 1.7% next up shares of ulta beauty higher by 2% at this stage the cosmetics and personal care retailer gets upgraded to buy from neutral by alts at goldman sachs. it was $185. they cited the fe belief that tw down in many parts of their business will rebound at the product and consumer rebound and we're going to end here. shares are down by 1.7%. roughly 4,000 shares of premarket volume best known for making b-2 stealth bombers gets a double downgrade. it is now a sell rated stock and it wasn't buy at one point they cited it over the last several months and other things like slowing industry organic revenue growth and below industry revenue growth relative to everyone else those shares down by 1.7%. back over to you. >> thank you for that. s&p sectors fell below their averages on friday during the sell off including financials, health care, industrials, materials, energies. so what are the technicals telling investors to do. joining us with answers. last time that you were here coronavirus was not a thing. so you were expecting things to go up. >> up over the long-term the market did set up for a pull back and we saw on january 22nd what the downturn in sentiment we have an overbought territory. that was enough of a reason to at least be hedged and manage risk and have a pull back and data first we have seen the major indices come in a little bit it's come in a little bit less than average and i think that actually makes it more vulnerable in the near term. >> more vulnerable for a downturn >> and they say so themselves should i wait, should i come in or is there something about to happen where i have a bigger opportunity. >> it's prudent to wait. so i wouldn't go bearish with this move. there's nothing to suggest that it's anything more than short-term in nature at this time but it doesn't appear to be over yet we don't have that widespread oversold condition that we look for. it's still not in that oversold territory. so you see them here at previous lows and that indeed was of course an opportunity to have exposure in that corrective phase. >> but you're calling for this to go lower as well. >> a bit lower. >> what's a bit mean >> do we need another say 20% of the s&p 500 to dip below the 50 day moving averages? and if tech does start to underperform we're already starting to see that with semi-conductor stocks that's where you're going to get that. >> let's flip this around. gold is a different story here let's see what's going on. >> gold doesn't always act defensively. right now it is at a very, very key technical level. longer term. it's right in here you can't see it but it's around 1590 now you post consecutive weekly closes above that. that's another major break out for gold we obviously saw it in the middle of last year and of course the follow through was impressive but if we clear this yet again another resistant level it would be about $1,800 so that would be a pretty major break out. we don't have it yet something to watch for. >> it's positively correlated. >> thank you thank you very, very much. >> we're going to send it back to becky right now. >> thank you. >> when we return, chinese stocks dropping sharply overnight in mainland china's first year back from the holiday. first time since january 23rd. we have a live report from the region straight ahead. new york state is taking business to the next level. supporting innovative companies that will shape tomorrow and building workforce development and tuition-free college programs to generate the talent companies need. with a $150 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composite opening down by 8% it barely managed to recover any of those losses closing down by 7.7% and wiping out 400 billion of the market value. get this around 2,500 stocks trading in shanghai and shen zen all trade a limit down of 10%. concerns about the sell off saying the impact from the virus may only have a temporary impact on the economy and the stock market plunge was driven by irrational factors or even panic triggered by the herd effect none the less, though, 7.7% down that was for shanghai. even more from the market. >> thank you i want to get to eunice on the ground in beijing right now with more as well >> thanks so much andrew china is back at work today. at least 24 provinces and cities told their companies not to restart their operations until after february 9th so that means more than half of china is still shut but those places account for more than 80% of national gdp and 90% of exports in the port city actually told it's companies that they shouldn't reopen until further notice now other localities have also imposed new restrictions for example. the city which is famous for its small and medium sized businesses have imposed a partial curfew on its residences now every household can allow one person to leave the house to go shopping for daily necessities every other day. now in the southern province, one factory owner there told me that his factory was told by the authorities there that they had to get one or two masks for every worker for every day he has 1,500 workers that raises a lot of questions for him as well as for other factories as to when they should reopen just also one more thing as proof that the situation is not normal here. in between the live shots that i just did with you guys before and now food deliveries all come with the temperatures and the nam names. and the person who packed the food as well as the courier. >> that's just a reminder. it's how many people are touching your food along the way, right >> exactly it is a reminder and last week a lot of people got freaked out because someone posted a video of a courier coughing on a meal and that went viral. >> oh. >> i know. so suddenly a lot of restaurants starting instituting this policy. >> what good is that if you are potentially a carrier of this without showing any symptoms which is what we have heard from the doctors. >> sorry what did you ask i didn't hear you? >> what we heard from the doctors is that you can be a carrier of this and transmit the virus even if you aren't showing any stiymptoms. >> exactly that's why people are so worried about this. >> eunice, be careful. eat kind bars. we'll see you soon for more on the spread of information about the coronavirus and the virus let's bring in the director of vaccine research group at mayo clinic and dr. scott gautley. i want to start with you and just trying to put numbers on the ground you were with us last week and said it in china. >> i think we need to change our posture here in the united states we need to try early and that mea means that's helpful but we have to be circulating. what we want to do is step in to take measures and small outbreaks and larger outbreaks and epidemic. >> how do you do that? i thought the cdc were the only ones that could do the testing. >> that's just it. it's pcr based tests a lot of people could run it we should change the criteria for screening. it has a negative screen on what we call the multiplex test, viral forms of pneumonia and it's a suspicious case they should probably get tested. >> even if they haven't been to china? >> in the setting of an outbreak it's going to be secondary spread it's not going to be someone that visited china that gets sick it's going to be someone that interacted with someone that visited china and is sick. if you believe 10 to 20% of people develop pneumonia only a small amount end up in the hospital you might have a dozen before you have enough suspicious cases showing up so you want to get that trigger earlier so you can spot bigger outbreaks. we're basically at a pandemic now and what we need to be doing in a situation like this is we need number one, point of care diagnostics which is what scott was referring to we need to have a lower threshold for doing that and, you know, remember, that sars was controlled basically with very low tech but high efficacy measures like hand washing, social distancing, wearing masks, et cetera so that's what we really need to be focused on concentrated on now. >> i think what we should be trying to do here is time to get to the spring and summer when the epidemiology of spread might change it might not be a backstop because this is so novel it might still transfer in the summertime but we should hope. >> let's talk about the economic impact for a second. if you're trying to wait until the summer, what else are you going to have to shutdown between now and then. >> the next two weeks are pivotal. we might have dodged the bullet here we're going to start to see secondary spread in the united states in the next two or three weeks rm weeks. >> and then what >> it's going to be a difficult month. people are going to start to shutdown difficult activity to try to contain the spread of this the good news is that people are concerned and we'll be willing to take measures that will be necessary to stop this from becoming a bigger epidemic in the united states. >> it's early. >> finish your thought go ahead. >> it's early but we have had very limited second generation cases as opposed to other areas like china. >> here in new york for example, a lot of the chinese immigrants move to queens if you take the seven line out there, there's a lot of people wearing masks. is that something that people in new york should consider doing generally or no? >> masks have limited usefulness it's going to get moist in a small amount of time it's only useful for 10, 15, 20 minutes and it's more useful for a longer period of time. most people aren't using that. they're using nurses masks if you look at what they're wearing. the best value of a mask frankly is it prevents people from touching their face. this really transfers so people touching something and then touching their face so if they have a mask on they'll be less likely to touch their face they're doing some good. >> you point out -- >> the advantages behaviorally. >> exactly. >> you point out that sense sars the amount of train travel in china is up tremendously the amount of air travel you can probably see the same thing around the globe we are seeing people travel much more frequently. >> number one you have a novel virus that can infect humans we don't really understand it's reproductive number and we don't understand the case yet. the number of cases that you're hearing about over 17,000 today is absolutely an underestimate those are the more severe ones that we know about what the real denominator is we don't know as you point out unprecedented in the history of mankind has been the level of travel and one week in china there were about 2,300 flights at the beginning of january. out from china to the rest of the world. that's a lot of people moving around. >> it's an excellent point we don't even really know the numerator because china is under testing right now but we definitely don't know the denominator. there's probably tens if not hundreds of thousands of cases in china so when you start to factor that in the case fatality rate is more like .5% but even that would be devastating if the transmisability. it's got a case mortality rate it could be devastating. >> it's smaller than that. if you look at people with influenza here in the united states and 8,000 people that died it's closer to a .005%. >> we don't have a vaccine, no backstop i'm sorry, doctor. >> yeah, no, that's right. i was going to say the updated numbers of influenza are an estimate of about 25 million that have been infected somewhere around 20,000 that have died this season and another 2 to 300,000 that have been hospitalized. so you compare the two what scott is getting ready to say and is right is this is a novel virus for us this is an absolute virgin population we don't have any immunity to this and that's why you tend to see some what more severe disease. >> doctors, we want to thank you both for your time today. >> coming up we return he's going to join us live big question that investors have is what's the best move today. double down? seek safety. we will bring you e thideas and the answers straight ahead robinhood believes now is the time to do money. without the commission fees. so, you can start investing today wherever you are - even hanging with your dog. so, what are you waiting for? download now and get your first stock on us. robinhood. but in my mind i'm still 25. that's why i take osteo bi-flex, to keep me moving the way i was made to. it nourishes and strengthens my joints for the long term. osteo bi-flex. find our coupon in sunday's paper. joe is out today >> always a pleasure. >> u.s. equity futures are indicated higher there would be big moves if we hadn't had such a sell off on friday dow futures indicated up by 130 points but put that in perspective of the 600 plus points the dow lost on friday. s&p futures bouncing back too. up by 17 points and then the nasdaq is up by 53 on friday both the dow and s&p 500 lost all of their gains for this year the nasdaq did in january up by 2% let's also take a look at what's been happening at the treasury market this morning. as usual we focus on in on the 10 year note yielding 1.549%. >> w

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