Transcripts For CNBC Squawk Alley 20240713

Comfort comes in to pier 90 here in midtown manhattan, a sign that more help is on the way. We are expecting news conferences shortly from the mayor bill de blasio and new yorks Governor Andrew Cuomo here, sara. Contessa, ill take it. Remarkable pictures as you said of the Field Hospital in the park and the comfort. Well be watching for the governors briefing we think in the coming moments good monday morning. Im Carl Quintanilla with Morgan Brennan and jon fortt, as we continue to practice social distancing as a precaution here at cnbc. Markets have been enjoying a relatively stable day. Weve been in a range of probably plus t2 or 300 points n the dow. Boeing one swing factor, but overall rates coming down, guys, as we see at least some relative stability in stocks and the degree to which that helps us repair other markets will take time to understand eamon javers is going to remind us of a political story from a couple weeks ago he has that this morning as well hey, eamon yeah. It seems like a long time ago, carl, but we are getting now a statement from senator richard burr remember, cnn reported over the weekend that fbi and department of justice are investigating his stock trades based on possible classified information that he had about how bad the coronavirus was. The senator dumping quite a few stocks earlier this year and said he did nothing wrong in any of this and we have a statement from his attorney saying, the law is clear that any american, including a senator, may participate in the stock market based on Public Information as senator burr did when this issue arose, senator burr immediately asked the Senate Ethics committee to conduct a complete review and he will cooperate with that review as well as any other appropriate inquiries. Senator burr welcomes a thorough review of the facts which will establish his actions will be appropriate. This investigation reaching a new level here the challenge for investigators is going to be that they would have to prove somehow that senator burr took that action knowing something that the general public did not know about the status of the virus in wuhan at the time that he sold the stocks there were public reports widely about how fast the virus was spreading there. Of course senator burr himself said he made the trades based on what he saw on cnbc. Separating out that public versus private confidential information could be the key here to potentially making any case against senator burr. Well see where all the goes in the days to come. All right eamon, good update eamon javers thanks for that todays Market Action, bring in sandy, senior Portfolio Manager at beuberger burman. Good morning. Good morning. Thank you for having me. Its good to have you a lot of sort of conflicting opinions about what the market does tactically from here after last weeks bounce some say this is a head fake, others say theres been so much discounting done already, if you have a sixmonth, 12month horizon, its a smart move to start at least looking at selective sectors. Where is your head right now yeah. So i think the way we kind of look at this is, we are in as best a situation as we can be, in the standpoint the fed are being very accommodative they were accommodative prior to the virus becoming a huge Health Crisis and they are remaining accommodative and doing whatever it takes to make sure this doesnt spill is over into a very nasty economic recession or worse. Then the other thing that we would look at is the fact that when you compare like some of these other major corrections weve had in the past 20 years, call it, in 2000 and 2001, the economy was already showing signs of weakening, the fed had been raising rates and the economy was weakening and when september 11th happened that was the catalyst that really took the market into bear market territory. When we saw 2007 and 2008, same thing. There werelots of signs of stress going on. The fed had been raising rates prior. In this particular situation, we dont have those conditions. So we think that argues for once things get back to normal, once we have potentially a virus treatment or, you know, just more testing and social distancing actually is working and we can return to normal lives, we think that you could see a decent recovery. Its just going to take a couple of quarters before it can really manifest because i sort of but is it sorry is it fair to say then that the speed of the policy response and the relative health of the economy going into this with a socalled head of steam, thats what makes this different from past crises or even 08 . I think so. I think thats true. And so to the extent that we can keep the liquidity flowing to our companies and to people, we may be able to skirt the worse Case Scenario which is devolving into a credit crisis and if we can avoid that, i think theres a case to be made that within a couple quarters we can ramp back up so sandy, just to dig into that a little bit more, you have jpmorgan saying the market is probably past its worse now, Mohammad El Erian who has been cautious to say the weeks now, on our air saying were not in an allclear for stock index buying, but the sell everything moment has passed. I realize from an economic standpoint the worst numbers are still yet to come fwruts a market standpoint is it safe to say we could be actually near a bottom how do you see it . Yeah. I think that will depend on the commentary from companies, when they have their earnings reported in april, just going to be a lot of uncertainty. When the data begins to actually turn and we can Start Building a pathway towards a resumption of Economic Growth or even just not worsening situation, that that will set the stage for when companies when investors can begin to look through, you know, these massive moves weve seen and the worse case fears allayed and begin looking at companies that are pretty beaten down now. There are a lot of stocks very beaten down, valuations look attractive, dividend yields, we run an Equity Income fund, where we think the dividends can be sustained over a short, medium and longer period of time. Sandy, a lot of investors out there have a timeline thats far longer than even six months or a year, a lot of people investing for retirement looking at five years or longer. For the people in that category, what are the assumptions they should have about this market and whether they should be either just buying now with spare cash orshifting their portfolio allocations into more equities given what the market has been doing well, i think this is an Asset Allocation decision which should be done in consultation with their adviser everyones personal situation is different. But i would just say i think right now, there are a lot of highquality companies with very strong Balance Sheets and very, very good defensible businesses that are paying dividend yields that are well above the market so to speak and where we think those dividends can not only be sustained but grow over time to us thats a very, very good investment combination. Finally, sandy, not to get too wonky, but sort of the vix futures are interesting. Bob pisani has a good piece on our website this morning where you look at april expecting the vix to be 55, 45 in may, 40 in june, 30s by august. How much credence and faith do you put into that hope that volatility will be suppressed as we move forward . I suspect as we begin to see improving data, you know, particularly if we begin to see, you know, sort of treatments and testing and a vaccine that may come out in the future those are going to be issues that begin to allay the worst fears and that will bring the vix down. The fact that our Credit System remains in intact and we dont tip into a credit crisis that helps the vix in the sense it brings volatility down i think people will begin focusing on what these companies are and earning power is, how strong their position is and realize that theres some great values out there. It will be good to get maybe some restoration of guidance after so Many Companies have pulled it in recent weeks and help us understand what earnings might be for the year. Right. Thank you, as always. Yes. Sandy pommeroy. More will be revealed were goingic to ta a quick commercial break a look at the major averages staging a mild rebound from fridays selloff. Ure s p up 2 , trying for its foth gain in five sessions stay with us and sometimes, you can find yourself heading in a new direction. But when youre with fidelity, a partner who makes sure every step is clear, theres nothing to stop you from moving forward. Aand were here for you ry day fespecially now,rs. S clear, doing Everything Possible to keep you connected. Through the resilience of our network and people. We can keep learning, keep sharing, keep watching, and most of all, keep together. Its the job weve always done. It is the job we will always do. I am totally blind. And non24 can throw my days and nights out of sync, keeping me from the things i love to do. Talk to your doctor, and call 8442142424. Welcome back as the number of coronavirus cases continues to rise, so, too, does demand for ventilators. Joining us now the ceo of biomed devices. Dean, thanks for being with us today. Youre filling orders for two versions of ventilators and working on a third machine oxygen blender how many of these different types of machines are you making and how quickly can you get them out to customers well, we have two different models of ventilators that we currently manufacture. The newest one is the 100 which god approved by the fda last year, took us three years to get through that process thats probably the most popular one. We make another ventilator called the crossvent series of ventilators which has been on the market for over 15 years were Still Producing them and manufacturing those, so theres demand for any ventilator possible at this point then the air oxygen blenders we manufacture can be used in a highflow therapy situation before, you know, the patient doesnt need to be put on a ventilator they may need to go from that therapy to a ventilator if they continue to get sicker, but if not, thats a good option to use our air oxygen blender with a humidifier and a nasal cam mullah to deliver oxygen to the patient. How many machines are you producing right now and can you keep pace with the demand that youre seeing . We are producing and working were a small company, 80 employees. Weve been in this business for over 30 years. Were producing about 50 a week right now with seven days a week we can produce more, we can higher more people, theres plenty of people available, but the problem is our supply chain and getting parts in thats what were we have been approached by a very large connecticut company, which i cant says the name of yet, we will be able to by the end of this week, to help with our supply chain and help with manufacturing. Were looking to ramp up to hopefully a thousand a month is our plan dean, theres been a lot of talk about the triage in the type of ventilators. Sounds like youre making a type of ventilator that would be useful for acute cases, but more open sourcing of basic ventilators that can be used for people beginning to have serious breathing difficulty what is your take on that movement to allow more broad production of basic ventilators . Is that going well is your sense that there are more of those needed than those that will be effective for more acute care yeah. From my understanding of the requirements of the ventilation of a patient that has covid19 is that its not they dont need to have all the real fancy modes that a lot of Critical Care ventilators have i have seen it and my team is working on an open source ventilator which basically something mechanical to squeeze a bag and breathe for a patient. Our ventilator is not a Critical Care ventilator. It really is designed for transport, has most of the modes of Critical Care bedside ventilator at a third of the cost and is portable with batteries so they can move them around quite easily as opposed to the big, heavy duty Critical Care ventilators dean, i realize youre about to announce a partnership with a major company, probably before the week is over and youre going to see your production numbers continue to ramp up dramatically in the meantime given the fact that you have been shipping ventilators to italy, japan, other parts of the world, and now youre receiving orders here in the u. S. , how do you prioritize which orders to fill first . Its tough. I mean, you know, i contacted the state of connecticut a few weeks ago to say look, i really prefer to be shipping these im from connecticut, born and raised in connecticut, to connecticut and the u. S. We do have customers that we worked with for years internationally so its a tough situation. The governor came to see us yesterday, put on a press conference here and we committed to 100 ventilators to the state of connecticut he signed a purchase order for that while he was here we are trying to prioritize u. S. , but were not going to not ship anywhere else as well dean, what would help as far as information that you could be getting either from one centralized location, somebody in the federal government, or the communication from states, from medical facilities to help you make these decisions about prioritization, about demand what kind of improved communication from here or better communication from here would help yeah. It would be nice i was contacted by the white house pandemic covid19 task force. I have not heard back from them. I dont know whats going on with them at this point. Just as far as, you know, our local government here in connecticut is now in full contact with us, but as far as federally no, we dont really have any contacts. Dean, im curious to know more about the supply chain issues that you mentioned. Where are those chains based do you sense that were going to be seeing some migration of those chains repatriating some of that component manufacturing in the months or years to come yeah. So we buy from, you know, all over the world there are some things that we get from china, not a whole lot, but thats been an issue because even before the covid, they go in the Chinese New Year and then got hit with the covid that slowed down things coming in from china. Mostly its injection molded things we get from there Circuit Boards are an issue. We have a proprietary motor turban built into the ventilator, some of those parts, you know, are going to be harder to get i will say that all of our vendors understand what we do and have been really helpful in trying to pull these things in quicker than normal and putting us to the top of the list, which is great to see. I mean, really everyone is behind this. Dean, quickly, going back to the beginning of this conversation at a time where were seeing millions of people file jobless claims and go on furlough lose their positions, did i hear you say youre hiring we are hiring, yes. We dont want to outpace our Raw Materials at this point, so were working seven days a week, we are looking to hire we may put a second shift on when we get better visibility on where the parts in the supply chain are coming in. We dont want to outpace that. Its a matter of putting the Raw Materials in. Dean bennett, biomed devices, thank you for joining us today. Thank you now we are going to take a quick break. With all the major indices at session highs the dow is up at 450 points, the s p and nasdaq likewise up more than 2 the nasdaq is up more than 2. 5 . Wel rhtaclbeig bk. Welcome back with the s p up 62 points right now, we take a look overseas to european markets which are set to close in a moment seema moody has the breakdown there. Seema . Hey, morgan, a survey measuring Business Confidence across europe getting a lot of attention this morning it shows a plunge by 8 Percentage Points in europe. The worst monthly decline on record that does coincide with a decline in european stocks, although we should point out theres been a major intraday reversal stocks in europe were down as much as 2 and we recovered significantly in the last 30 minutes, as did Oil Prices Still lower, although President Trump did say he plans to speak with russian leader vladimir putin. That does come ahead of the highly anticipated opec meeting on thursday, the bank of england meets that day as well, the central bank cutting rates last week separately, new warnings from two major multinationals, chipmaker asml, a supplier to apple, and luxury retailer lvmh bringing down their numbers. Lvmh expects revenue to fall between 10 and 20 in the First Quarter. The results come out the 16th of april. Carl, for now, back to you all right seema, thank you very much dow is within a stones throw of a 500point gain here stocks have about 2 we will take a quick break and return in just a moment. Feels like theres no barriers between departments now. Do you think everyone appreciates it . I do. Huh. Forgot my glasses. Serivcenow. The smarter way to workflow. Woi felt completely helpless. Hed online. My entire career and business were in jeopardy. I called reputation defender. Vo take control of your online reputation. Get your free reputation report card at reputationdefender. Com. Find out your online reputation today and let the experts help you repair it. Woman they were able to restore my good name. Vo visit reputationdefender. Com or call 18778668555. Lets get the latest on the coronavirus outbreak and efforts to slow it sue herera has that at headquarters sue . Indeed i do, jon, thank you very much. Good morning, everyone japan will begin blocking the entry of citizens of countries including the u. S. , britain, china and south korea. That ban also includes people who have traveled to those countries within the past 14 days japanese returning home from the listed countries will be tested for the is virus. Gretchen whitmer has committed 150 million to Coronavirus Response she says medical professionals in her state are living day by day when it comes to medical supplies and two hospitals in southeast michigan are already at peak capacity michigan has the fourth highest number of cases of any u. S. State. In arizona, the National Guard is helping to stock grocery shelves. Soldiers are being deployed to 86 Stores Across 15 counties arizona has just over 900 confirmed cases of the virus some good news from britain, Prince Charles is out of selfisolation and in good health the 71yearold tested positive about a week ago little bit of good funews there. For more on the coronavirus coverage here at cnbc, go to cnbc. Com carl, back to you. Sue, thank you very much. Lets bring in mike santoli and talk about todays Market Action stocks are relatively stable you have rates on shortterm paper coming down. Weve talked about the vix softening a bit. How much good stuff is happening relatively speaking . I think incrementally encouraging. I think the stability that you led off with is the key. If the s p were down 1 or 2 , it might be as good as being up 1 or 2 , the idea that perhaps the fever has broken and a lot of that forced activity and the Spring Loaded action we saw into last monday maybe is subsiding i think its small steps its interesting were at one of those moments yet again where you have to hold these sort of opposing ideas in mind at all times. One is that when you have one of these kind of crashlike actions, you have the panic low, you do get a relief rally. Sometimes its not trustworthy and you have to return somewhere in the vicinity of the lows. Thats the historical playbook on the other hand theres no script and times when we dont necessarily have to have that action, late 2018 is one of those periods. Right now the market continues to hunt for an algorithm to figures this out i dont mean a trading algorithm but what information are we trying to ingest that gives us an idea of the pacing of the disease as well as the economic comeback i just think thats still very opaque and nobody really has a handle on it where does that leave us the market reacting to itself. Pension rebalancing flows, technical levels, you know, testing, seeing if the volatility drains away and all the rest i think thats the moment were in right now how about end of month, end of quarter, flows positioning, rebalancing . How much is going to influence the way things look over the next couple of days . Its i think maybe today and tomorrow is going to be the last of it in terms of the actual mechanical rebalancing perhaps and i think a lot of people attributed thursdays rally to a lot of that. The psychology of that can persist longer you know, what does that mean . It means everybody looks at this vast underperformance of equities versus fixed income and probably asked the question, does that mean its time to safely reallocate back into stocks if you have a somewhat longer term time horizon that seems to be where the professional consensus might be coalescing right now it might not be the low, maybe we will have to break it again, but we usually dont spend too much time at a further panic low and if you have a 12month or longer horizon you dont get hurt too badly all of that is in the information right now. I dont know how much the action is literally that mechanical pension type rebalancing, but clearly thats been a tailwind and maybe continues to be today. Mike, i see some people out there confused about the Market Action, given the infection numbers that we see continuing to rise, the death numbers continuing to rise, equipment shortages and people who arent used to watching the markets every day might not understand how they react to bad news youre great at explaining this in plain english, explain that the market is not necessarily reacting in real time to headlines today, but its more based on expectations for the future without a doubt first of all, the stock market went down more than 30 , nearly a Straight Line and took away three years worth of gains in a month. It with went a Long Distance in a very short period of time to pricing in a pretty bad scenario with regard to how this infection was going to play out as well as the economic implicationses it doesnt mean it figured it all out at that moment but frontloaded a lot of that pain the market will try to continually dial ahead to about a six month window to say what are things going to look like then are things getting less bad. The market do best when things are going from really bad to less bad because it enables the market to build in the scenario of improvement the market will probably over anticipate that moment, maybe it already has over anticipated how much has been discounted and well get a couple false start rallies. Eventually its going to be building up a resistant, so to speak, to the incremental bad news about the infection it basically puts it against what was already expected and what it has already priced in. Thats the dynamic that i do think is playing out and why it seems in congress, when you see is awful economic numbers or really bad news about new infections and the market seems to take it in stride, at least for now. Yeah. I like the way you put that, resistance the other piece of the puzzle is really crude and you got wti which dipped below 20, near 18year lows earlier in the session and we know not only from what weve seen in recent weeks, but from what weve seen when the Energy Complex has collapsed in terms of prices in previous years, that that can have ripple effects to other markets be it credit or certain sectors like, for example, industrials, materials, transportation how closely are you watching that yeah. I mean morgan, its an exacerbating factor on the Corporate Credit market which is really the one area that remains a little bit squishy, right. Youre not necessarily seeing an all clear by any means in the riskier ends of the credit market also the markets are not pricing in some kind of wonderful Capital Spending end demand environment. Copper is not rallying it fits with the mode maybe things are okay with the businesses that have stability built into them, but in terms of what it does to credit, how long we have this wear and tear of an economic stoppage on consumption and Capital Spending is a totally huge open question watching it closely, i dont know how important each individual dollar level is for crude right now because at this point it seems like the market is just furiously bidding for storage and it cant find enough theres an actual physical element of whats happening in the oil markets right now. Yeah. The president did say this morning, mike, that he would talk to putin and, in fact, the wires are now saying kremlin says putin and trump agreed to hold u. S. russia talks on oil market at the ministerial level. Its not much, but you can see how you might see some start to pin their hopes on maybe some discussions about world supply well take a quick break here. Obviously markets still enjoying a green day. Back in just a minute. You may be learning about, medicare and supplemental insurance. Medicare is great, but it doesnt cover everything. Only about 80 of your part b medicare costs. A Medicare Supplement Insurance Plan may help cover some of the rest. Learn how an aarp Medicare Supplement Insurance Plan, insured by Unitedhealthcare Insurance Company might be the right choice for you. A free decision guide is a great place to start. Call today to request yours. So what makes an aarp Medicare Supplement plan unique . These are the only Medicare Supplement plans endorsed by aarp because they meet aarps high standards of quality and service. Youre also getting the great features that any Medicare Supplement plan provides. You may choose any doctor that accepts medicare patients. You can even visit a specialist. With this type of plan there are no networks or referrals needed. Also, a Medicare Supplement plan. Goes with you when you travel anywhere in the u. S. Call today for a free guide. Welcome back Small Businesses are among the groups feeling enormous pain with the shutdown associated with the coronavirus crisis. Lets bring in the cofounder and ceo of ledberry, mens apparel maker, paul tribl, good morning. Good morning. Thank for having me on great to have you im hoping that you can really bring home the pain and necessity for Quick Reaction that Small Businesses are facing right now. What has happened to your orders how have you had to shift what youre producing in the face of this crisis . Yeah, absolutely. Were a mens shirt maker based in richmond, virginia, we sell nationally in a number of ways we have our stores, three of our own stores and they are closed and will be for the foreseeable future secondly we have a wholesale business we sell to National Retailers and specialty retailers throughout the country. Those retailers are suffering and stopped accepting orders that leaves us with a lot of inventory. The exception has been stitch fix, a phenomenal partner that continues to take our orders which is helpful the last piece were an ecommerce business, 70 ecommerce and because of that we are luckily at most to ride out this it has been slow in the last five days there has been an uptick, usually helpful for our business one is maybe people are settling down and at home and sort of looking for maybe a little distraction or Retail Therapy and hopefully ecommerce businesses can provide that and were seeing customers coming in and supporting us. You know, people who are buying 1,000 gift cards not necessarily because they need a nice shirt, which we make, but they want to support our team and make sure were on the other end of this. Tell me, do you think that purchasing gift cards for Small Businesses is broadly going to be helpful and also, can you tell us what youve been doing with the workforce have you had to lay off or furlough how are you managing those decisions given the demand dropoff youve seen of course like everybody in the country our thoughts are what can we do in the near term and then what we can do to generate revenue. We are an ecommerce business, 50,000 customers throughout the country and seeing as people come back, although still probably 50 than a year ago this time, so thats helpful buying a gift card whether for a brand you love or a restaurant youre supporting or even your barber shop is hugely helpful to try to put revenue into peoples hands when they need it most which is the next six weeks. In cost cutting, what dont we need we came out of a great time and now in a time where we say what is the core of our business . Were saying what are the small things that affects everybody, whether cleaning services or whether its marketing platforms. You know, unfortunately were in a place we had to make targeted layoffs which is devastating to do particularly in this economy and where we are now but our hope theres going to be government assistance on the side of this, with the care act, hire the people we let go and build around our core ecommerce business to get us through this. Paul, i want to gauge your sense of whats happening within the transportation piece of this i know from my house, for example, on the ecommerce side, delivery has been pretty delayed from a number of different vendors to my house and ere geg reports that shipping costs are jumping and jumping dramatically right now. What are you seeing on both sides . Yeah. First on the freight, its been challenging probably since february, you know, early february we our production about 80 takes place in europe and turkey and china. There are factories closed in turkey, our suppliers in italy, mostly northern italy are closed and were still able to ship some out of those businesses, but its very minimal and difficult to get flights ironically china which was difficult, 20 of our production it take place, is back on line the factories are open and shipping, but freight costs, even a month ago when we brought over product we were 200 administrati200 addition per shirt there arent the flights to meet that demand. As long as we can get the product out thats helpful then on shipping to customers thats our lifeline. It is like for a lot of ecommerce businesses. Massive amount of pressure on the system but my hat is off to all those people delivering packages to your doors every day. We have a place in richmond which still continues to operate and thats hugely important. We sell beautiful shirts to people that can afford them and blessed to have this business. People need the supplies, you know, that are critical for them, whether thats advil, tylenol or dish washing detergent. In our case were still able to fulfill and hopefully get a shirt to somebodys door and surprise them in a couple weeks and, you know, make them think of Something Else besides the news paul, i hear what youre saying about layoffs and those difficult decisions that youve had to make, so i want to ask about fiscal help from the government because it seems that in an effort started in the senate that was going to be offer these loans that would be forgiven if businesses didnt lay off anyone, what is it about the structure of that, that perhaps doesnt make it doable for you . Is it the uncertainty around how its going to be implemented, just the cost to carry those employees for an undetermined amount of time is there anything as Congress Continues to work on stimulus measures that you think that they could further do that would keep you from having to do further cuts yeah. You know, i think weve all been waiting to see what would happen and i think obviously a massive stimulus package was passed ap were excited about that from our personal experience we said like all responsible business owners, all right, were in crisis mode, what can we do . We have to be proactive and continue with momentum to get through this what are our options we applied for an sba loan on Disaster Relief side as soon as the governor declared that in richmond last week that is a menu of options for us the second piece the cares act which has a lot of great things in there, a lot of things that are protecting payroll which is critical and keeping the teams intact and so i think the question now is, how do those Work Together and how do we apply and receive that i think the government moved quickly on the stimulus package and now its how do we execute it and make it very clear. I had a dentist reach out to me today saying what have you done with the sba and the cares act how can we communicate that as quickly and simply as possible and then really make sure things flow through in the next two, three, four weeks to ensure people wont have to make another round of hard decisions. Yeah. Thats a go aheod point the u. S. Chamber of commerce has a guide online at u. S. Chamber. Com if youre a Small Business or independent contractor or gig economy worker it will guide you on how to file for some of the care act relief packages have you thought about assuming you were able to get some kind of relief, either a grant or loan, what you would spend it on first . Yeah. It would be payroll first. You know, i think we have a team here, were a Small Business, we have a team of less than 20 people here who are critical to what we do and its taking care of those folks and making sure they feel comfortable and rally around and get through the period potentially looking at targeted cuts weve made, how can we bring back people to strengthen our team where it was core and focused before this happened you know, so i think the question is, thats hugely helpful. Obviously, you know, we have a lot of product that were still trying to bring in at this point. Theres a lot of like production and suppliers and i think one difficult thing about the apparel industry, there is a chain, like all businesses where we might something to our wholesaler they pay us for that, the factory, based in europe, they pay the fabric mill based outside and we have to basically stopgap that and continue to take care of not only our team, but the people who are partners and friends on the other side of the supply chain to just guarantee that we get out of this, were getting out of this together and move forward and quickly once theres a resolution those are tough decisions that are being made all across the country, all around the world, as Small Businesses that are so critical to the Global Economy try to continue operating. Paul, cofounder and ceo of ledburry, thanks for being with us. Thanks for having me. Just getting a check on the markets as we head to break. A lot of green arrows, major averages up more than 2 the dow up 458 points right now. The s p is up 2. 4 2600 on the nose and the nasdaq is up 2. 6 as well every sector in the green except for real estate. Stay with us this piece is talking to me. Yeah . So what do you see . I see an unbelievable opportunity. I see bestinclass platforms and education. I see awardwinning service, and a trade desk full of experts, available to answer your toughest questions. And i see it with zero commissions on o. I like what youre seeing. Its beautiful, isnt it . Yeah. Td ameritrade now offers zero commissions on online trades. Welcome back lets now get out to Rick Santelli at the cme groups Global Headquarters in chicago rick thanks, jon you know, over the last couple weeks weve seen so much, but one of the big outliars ive been hearing about is the run up to the end of march, which is the end of the First Quarter so rebalancing, while off balance. Boy, some of the numbers leading up to this rebalancing have been staggering, so large, but im not sure that i believe any of it actually. Lets look at some charts just to put a face on it. Heres the year to date of the s s ps, 10year notes, the yields have fallen off a cliff, and the dollar index was just super volatile the way its supposed to play out is, is that everything that is sold off, think stocks, are going to rebalance to the upside, meaning youre going to buy some stocks and thats going to be at the behest of what, of course, has been purchase that went straight down and that, of course, is the bond side were going to most likely see selling on the fixed income on the bond side and buying on the stock side sounds so easy i find it hard to believe were going to see the numbers being talked about, hundreds of billions, that are going to wait until the end of the session tomorrow as a matter of fact, if you really think about it, when was the last time we had reasonably large selling in the long end of treasuries at all . Well, it wasnt at all last week think about the closes last week our highest yield close was 87 wednesday, the lowest one was 67, and that was friday. Even the higher closes were very much an event that didnt represent the type of trade weve seen all session really, youre going back to the 16, 17, 18th of march when we were over 1 that was a couple weeks ago. And as far as the equity side, yes, we had some good days last week i guess its fair to say i think its going to be more of a window dressing than it is an aggressive trading rebalancing i dont want to diminish the fact were definitely goin to see some selling pushing rates up im not sure what part of the curve. Well see some buying pushing stocks up. Im not sure exactly when its going to come in or how much is done already in the final analysis, it will give us some very important clues because if we dont see bigger numbers especially on the buying on the stock side, i think over the next cup l couple of weeks it will be take foot off the gas all week last week, if you look at numbers whether its the vix or the tyvix they are predicting a will the of volatility the way this balance is shaping up, i would have to agree with that carl, back the you you put your finger on debate of the week. Thank you very much. Quick break, were back in a moment dont go anywhere. Life isnt a Straight Line. And sometimes, you can find yourself heading in a new direction. But when youre with fidelity, a partner who makes sure every step is clear, theres nothing to stop you from moving forward. Woi felt completely helpless. Hed everyonline. S clear, my entire career and business were in jeopardy. I called reputation defender. 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Welcome back lets bring in president and ceo eric fanning thanks for being with us today thank you in the last couple of week wes have seen boeing, more production temporarily, we have seen layoffs or furloughs from the likes of spirit aero systems, ge, Triumph Group to name a few how would you categorize what were seeing across aerospace and defense in the midst of what were seeing now its been a squeeze this virus follows whats been a tough time for the Civil Aviation market which is why we have been working to try to find ways to provide a relief to these companies in enormous supply chain of some 17,000 companies that are part of this ecosystem. We have been focused with our members on three lines of efforts since the virus became apparent to us the first is protecting the health and the economic welfare of the work force which is vital to the industry. Inject capital liquidity into the system as a tool to get through the crisis this enormous ecosystem is ready to start meeting the demand when we get through the virus ways they can combat in doing things they werent doing before theres a lot foef kcus on t trillion dollar aid package that got signed into law. Whether boeing, by the way taps into some of that fiscal lifeline or not, in the meantime, you also have the dod, you have nasa that are continuing to award contracts rite now and my conversations with officials do so perhaps even more quickly than the otherwise would have to keep getting cash into the hands of some of these companies. How would you categorize whats playing out on the defense and space side the governments doing an amazing job to try and inject that capital, that investment into the supply chain into the private sector side. The best way to keep is is suppy chain is to keep it working. Defense production act is getting a lot of attention right now given the fact that President Trump has referenced it how does that affect this Manufacturing Base and those companies that you represent and how does it play out from a dod stand point. I think its actually larger than dod and the defense it has the name because it was a serious of tools that were imagined in case we were at war. The focus is a different direction than it might have been if were at war the government is focused on gathering as many supplies as it can. Second, seeing what they need that they can get more of from existing manufacturers like honey well and 3m. Third is thinking about ways that maybe manufacturing can retool thats a lot more complicated to think through and take time to do it. Were seeing examples of industries stepping up and doing that independent of the production mask. Companies are doing this on their own independent of the defense production finally, i want to get your thought ons what were seeing start to play out in space as well right now we talked about the new space economy, is there more pain to be had within this piece of aerospace and defense puzzle i dont think so more than any other piece. The defense side, as we talked about has a lot of mechanisms to keep that liquidity, cash flow going through. The stimulus will help by injecting money into that supply chain. 70 of anything that goes to boeing goes right into that supply chain they are figuring out what the market is and certainly it will be motivations because of this virus. Thank you for joining us today. Thank you quite the news i was going to say morgan, quite the morning of news when you consider the news out of macys and the furloughs of these employees. The pictures of the u. S. Comfort arriving in new york well find out what that means in the days to come. It does feel like the mood is being set from pharma whether its j and j on squawk henry shine. We move into a week with a lot of news. Lets getto the half all right. Thanks very much our breaking News Coverage continues right now. Welcome to the show. Front and center this hour, stocks trying to build on last weeks Massive Gains our Investment Committee today, we will begin as we have for the last couple of weeks with swings in the marketplace now the dow industrial is up 445 points up