Transcripts For CNBC Squawk On The Street 20240712

Peter navarro meant to say on fox last night. There was a little confusion. I think that he was pretty definitive to say it was dead, the president was pretty definitive in saying the trade deal is on who would ever think that this would happen, good news out of europe, pmis are strong, they are inflating things in their economy like we are. I also think there might have been a short squeeze those of us who watched when navarro said what he said the market plummeted and i think overnight traders said its going to open down badly im going to get short and they got whipsawed because you didnt think navarro could be reversed as quickly as he was given the fact he is a close confidant of the president. Almost exactly what art cashin is saying this morning. Whipsaw resulted in a good deal of short covering. He says the bulls may now reassert control he says they need to take the dow up by more than 450. The bulls are when you watch the market ahead of time you see so many stocks going up for no particular reason, a lot of dow stocks are up look at nike, this is classic. Nike reports on thursday, another firm recommends it with a big price target boost, thats three this week. David, when they do this they dont do it idly is nike going to give up 20 when they report on thursday because these guys know something . No, they dont know anything. You know and i know they dont know anything other than they dont want to be on the wrong side of the trade. They dont want to be on the wrong side of the momentum that they see and that you can back into a valuation that justifies the move in some way it takes more guts to downgrade on valuation if you want to do that and oftentimes you end up being wrong, any way, jim, as you know. Right. Certainly in the market like the one we appear to be in right now, you look at nike, i look at zoom video one of the names of course in your portfolio. Right. Its a 70 plus billion dollar market value now with, what, i think 2 billion in revenues expected they changed the world. I can make a case for it okay. Go ahead pure momentum no no i mean, zoom went from 20 billion to 300 million, maybe it goes to 500 million. The cost is very low as you add customers. Is zoom extreme remember the companies that because im trying to avoid world com because world com is just the opposite. World com is a separate story. I know what you mean. Is zoom cisco which eric used to be there, cisco became a 400 billion company and still not there. Maybe zoom is the cisco of this year because it does have you could line up 99 with this year and it turns out that maybe its january of 99 and you will have missed the next 900 points in qualcomm, 1,000 price target, do you remember that one, david . I do. Of course i do very well. Walt pisec. I remember all of those very well, jim, and i remember how long it went on for. I know there is a case to be made with zoom but there is there a case to be made they will be hitting their peak subscriber level as people go back to work and get tired of the endless zoom calls or is the growth set in for sometime and they will figure out all sorts of different ways to monetize a growing user base. I think the latter. I think that its here to stay they can do different tiers. When we get 5g its going to be fabulous for them. Im sure some of the things that the Worldwide Developers at apple yesterday some of this could be used by zoom. Zoom has got i had a guy on last night who a checkpoint, who literally said that zoom has much better much, much better controls and security than it had. And thats remarkable. So, i mean but, you know, lets talk about two companies that im focused on today, square and paypal. Square negative article in the New York Times today about the basically cutting off credit to some people, but paypal and square missed the quarter. They missed, david, they didnt they missed. And their stocks are up gigantically from may 6th when they missed. This is one where i find why are they going up if they missed the quarter . At least zoom blew away the quarter. Its not right to me and i love those two companies but its not right that we come in every day and theres nothing new. Nothing. Paypal is 100 billion and its just a fantastic company, but they missed the quarter. 200 billion moorkt varket v. And they missed the quarter we will be talking to mastercard all of these are wrong david, all we can do is demonstrate there have been other instances where this didnt work. We cant say you have to short paypal because paypal is a great company. It is. Its like contactless, its the the next generation, its tiktok, david. Its tiktok. Thats shorthand for a billion people looking to do a contactless trade. Shorthand for another hot potentially 150 billion plus company if and when it becomes public being tiktok. Get with the program. There are some Hedge Fund Managers who believe that paypal is going to going to actually multiples from here in terms of its market value. Long term growth path is enormous. When we used to talk, david, i used to say the reason its a 200 billion is because its going to 300 billion. How wise is that i once went to lowes and i recommended pepsico and mr. Tisch said why because its at 90 and all stocks at 90 go to 100 it went to 100 he thought i was a genius. A guy i had on last night, kind of like a dave portnoy genius, but, david, paypal, maybe its at 200 because it has to get to 300. Thats maybe whats happening. And maybe you are just too old. Its been a busy week in payments overall, jim. We will talk to michael mebok of mastercard in the last half hour oppenheimer cuts it to market perform, they think visa will take share amex was cut to sell by ubs yesterday. Stls a lot of things about share being split. Theres crossborder travel, theres European Business maybe being a little better than u. S theres a lot to consider right now. Carl, there was an article in the journal about how alphabet is not getting the traditional travel ads we heard thought from our own network. Of course theyre not. Theres not as much crossborder as there was this is a whole group of stocks that i think are fraught, they can go down. These are vaccine stocks if you get a vaccine you want to short mastercard a vaccine. I mean, ive never seen anything like this in our markets if j j or regeneron or gleaxo or pfizer, oxford, if they came up with a vaccine you will wish you owned mastercard at 400. Thats what it is. Its the vaccine trade jim, you mentioned portnoy on your show last night. Right talking about whether or not for a certain generation of traders right now looking at stocks as simply filling time until sports returns here is what he told you. Im enjoying the stock stuff, you know, my firm dvtg we have made our marks, i wasnt expecting it, so its been fun im a sports guy, im a sports better i want sports back and when it comes back thats going to be where my focus is, but for now i am having fun with the stock game as you well know. So thats portnoy with the ceo of barstool. Jim, how i will stray testify is that of investor mindset right now . Hes got 66 Million People follow david, i think hes incredibly funny and creative, but you have to have, have to, have to watch on twitter his assassination of the Deutsche Bank guy who downgraded Penn National who he now works with i mean, it was the kind of thing that, david, you and i might joke about offcamera after maybe 40 margaritas and it is so brilliant. I mean, it is just like he wipes the floor with the Deutsche Bank guy. And you can argue maybe thats wrong, but you could argue, well, hold it, who are we to say i mean, there is that guy, he might be the u. S. Attorney soon, clayton, he was on, i mean, does he do they know anything about twitter at the sec . Do they . I think they know some things. What do they know i think they know some things. What do they call them . I dont know. If you follow clayton has an interesting road ahead for him there was an interesting memorandum of understanding, by the way, between the sec and the department of justice yesterd yesterday what do they understand you have to keep an eye on sort of trading and on the proxy advisers it sort of opens up a way for them to keep a closer eye on a lack of competition or at least tie in tying certain businesses to others. David, you are talking about genuine regulation youre speaking of regulation. Regulation and news the president will put out a tweet any minute that thats way out of bounds. Yeah. Im going to twitter and see what he says. I suppose thats true in the world that we live in. By the way, jim, not to but i remember 20 something years ago sitting across from joe kernen and making a lot of fun at analysts and having my penguins and doing all those things that guy portnoy was probably in high school. Or diapers. Yeah, but david is the logical he is the logical extension, Erika Nardini is a brilliant ceo. They have a big portfolio. Now, look, i mean, when sports comes back david is hes going to be more obviously sports, but, i mean, when i talk to him i say, listen, are you having fun do i want people to follow him if you follow him he tells you not to follow him. I mean, he does. Listen, im having some fun here but there are people who love him and he hit the cruise lines, hit the airlines right, but, you know, he pants Warren Buffett, i think that warren has had many Good Investments over the years. He did say that how could a guy who is 90 be at the top of his game and the answer is i know. You probably can be at the top of your game if youre Warren Buffett is he entertaining oh, my, hes must watch. Hes must watch. You dont have to do what he says, but he is must watch Deutsche Bank. Oh, my please go to twitter and that was a reaming like i have never seen its hysterical. We will take a break here futures look pretty good, as jim said earlier, pmis out of europe arent bad, we will get our own at 9 45. Got some calls on nike today mastercard a new street high on pell tron we will get to ought of thaem when squawk on the street comes back you should be mad they gave this guy a promotion. You should be mad at forced camaraderie. And you should be mad at tech that makes things worse. But youre not mad, because you have e trade, whos tech makes life easier by automatically adding technical patterns on charts and helping you understand what they mean. Dont get mad. Get e trades simplified technical analysis. I geh. Common bird. E. Ooh look over here something much better. There it is. Peacock, included with xfinity x1. Remarkable. Fascinating. Very. It streams tons of your favorite shows and movies, plus the latest in sports news and. Huh run the newest streaming app has landed on xfinity x1. Now thats. Simple. Easy. Awesome. Xfinity x1 just got even better with peacock premium included at no additional cost. No strings attached. Just say peacock into your voice remote to start watching today. Yesterday set to open at a fresh record high, of course, wwdc was yesterday, as tim cook talked about a new ios and of course that transition from intel chips to apples own here is what he said. The mac has had three major transitions in its history, the move to power pc, the transition to mac os 10 and the move to intel. Now its time for a huge leap forward for the mac because today is the day were announcing that the mac is transitioning to our own apple silicat. This morning, jim, deutsch says this is a financial and reputational negative for intel obviously, but they say it could be worth 30 cents a share. Yeah, some people think it could be worth as high as 46 cents a share in the out years when intel cracked into apple it was one of the biggest things ever i remember sitting down and saying when your going to get that apple business and they got it in 2005 people have turned on intel over time and dont feel its kept up with, yes, with amd but of course the one that my dog is named after nvidia or arm holdings which is the one that theyre using. All i can say is that yesterday was all incremental and yet the analysts all raised their price targets. Why do they do that . They recognize something that the fabulous Mickey Drexler said yesterday on squawk box, he threw it out, he said everybody has an apple phone who doesnt have an apple phone . Now you have all in you features the sleep feature that i want for the watch, i love all these different incremental things that you can make a phone call and you can see other stuff on your screen. Its all incremental but its all fabulous. What you have to do is get with a young person and figure out all these new things thats what i do i have a guy named dylan reback he techs me everything about my apple phone and apple watch. You need a guy you need a young person guy, but if you get it you cannot believe how great these products are david, youre going to get the watch. Theres no manual for the shortcuts. Jim, interestingly, peter shack our producer points out apple is responsible for 12. 5 of the dows gain since the march 23rd loi. 12. 5 . Up 60 in three months. Its kind of like babe ruth when he said, listen, he is going a good year. I think that tim cook is incredible because what he has done while it is incremental, something i was with this weekend had the apple 5, someone had the apple 7. These things look like model as and model ts all this incremental is nonsense what youre ending up with is a product that is better and better and better and knows everything about you all these little changes to the operating system make it so that you cannot believe the thing i mean, i know the phone knows that at 5 00 i start my workout by listening to pearl jam. How the hell is that possible . And the answer s well, its apple. Apple knows. It knows everything and it makes life very, very easy i mean, yesterday i turned on john denver in the middle of the show i didnt mean to but i said a couple magic words and john denver came on what happened was i said im sorry which is a song by john denver which was transferred to siri which played it during my show i love that. The viewers might not have you love john der vnver really david thank god im a country boy. There might be a day you wont want to listen to pearl jam. Black. Every workout starts with pearl jam . Ever since they inducted them in the hall of fame, eddie vedder, i follow him, too, he is a genuine genius david, you have to get with the program. I will try. I keep jieg. John denver carl, he doesnt like john denver. Im with you, jim im with you. I didnt say i didnt like them. Im not saying anna. But, david, thank god im a country boy. Rocky mountain high. Yeah. You annoy me. Im glad we covered this, guys we will take a quick break here and we will get back to the markets in a moment. By the way, some new targets on apple. Deutsch 380, ubs 400, bernstein 370. We are back in a minute. [narrator] the shark vacmop combines powerful suction with spray mopping to lock away debris and absorb wet messes, all in one disposable pad. Just vacuum, spray mop, and toss. The shark vacmop, a complete clean all in one pad. Can i find an Investment Firm with a truly longterm view thats been through multiple market cycles for over 85 years . With capital group, i can. Talk to your financial professional or consultant for investment risks and information. Big whipsaw overnight as navarro said the trade deal was over but then clarified his comments looking for a gain here as the nasdaq is coming off seven straight wins, s p up 5 of 7, squawk on the street continues in a moment. I have an idea for a trade. Oh yeah, you going to place it . Not until im sure. Why dont you call Td Ameritrade for a strategy gut check . Whats that . You run it by an expert, you talk about the risk and potential profit and loss. Couldve used that before i hired my interior decorator. Voila maybe a couple throw pillows would help. Get a strategy gut check from our trade desk. Four minutes before we get to an opening bell this morning, lets squeeze in a mad dash. Simon Property Group why . David, there is a story in the property section of the wall street journal saying they could be teaming up with brookfield in order to buy jcpenney at least some of the jp pennies. This is a strategy that there are big holes in the mall and i know that david simon has explained to me that the mathematics of actually taking back the best parts of the mall that they had where they had a lowpaying tenant and owning the property its just what can i say . I mean, they buy the tenant in order to boost the price of the mall in other words, rather than having them hanging out there in bankruptcy, this is a very smart move david, i have to ask you what happened to that lawsuit with taub man and simon properties. Its all going on in state court in michigan. Tomorrow its jim, there will be a hearing on the motion for an expedited trial. That you might imagine is something taubman wants. I believe the judge is slated to step down in november. He is seen as a law and order guy, perhaps favorable to taubman. Do they get an expedited trial meaning, perhaps, lets call it in the fall, Something Like that i dont know, but simon will keep on fighting even if its seen as a somewhat weak case. Remember he doesnt do anything if there isnt a good return on investment he is paid 33 billion in distributions. Again, the mall is problematic yesterday there was a pretty good poise, idiosyncratic to talk about it about how gap stores may be worth because of the real estate. I wonder how much of the change from the pandemic has accelerated the decline in the mall is the mall thought to be a place that is dangerous to go because it is an indoor area where there could be congregations. I havent been to a mall in a long time, for six months and i just dont want to go back i will go to costco. Yeah. Carl, there is the larger question as to whether this crisis has accelerated the decline of retail. Not even a question. We know it has the question is what it will look like. Its not just malls. What is that mask . Its also the streets of a lot of metropolitan areas, jim, that will be devoid of stores what do you do with them how are they repurposed. I dont know. These landlords wont cut because they buildings so theres nothing about having an empty storefront that they care about and yet you and i and carl as we go by we know empty sto storefronts they have bred crime, a sense of hopelessness and it is hard at least the city has taken away parking spots and allowed you to put tables out we are not ready for this. We are not ready for the boarding up of america no. But it may be may be coming its very much malls are entertainment, jim. Whether you go to the cinema thats attached to it or whether you just go and shop, thats something that cant be replicated on netflix over time, right . Theres not going to be a substitute for that at home. But i dont want to be next to someone without a mask. I dont want to be i thought that was great that adam aaron reversed him for amc and said you have to wear a mask, but i certainly dont want to go to i know Planet Fitness is in a lot of malls and i think theyre doing a great job trying to make it so that its clean, but, i dont know, look, im i cant be a risk taker. I dont want to be a risk taker in what i do in life even though i think Planet Fitness, younger, 25, 30yearold person no problem. Someone my age its too risky. Look at that green, will you yeah. This is crazy yeah. I mean, come on is everything doing that well . Fair amount of green here at the open, obviously, as you can see from breadth jim, interesting uk Prime Minister Boris Johnson laid out some reopening policies starting in the beginning of july today theyre going to shorten that 2 meter rule down to 1 meter which will allow more pubs to open, cinemas, libraries, museums soon they say they dont see a risk of a second wave at least at this point. You should be outside not inside and i think that that is unwise he had the disease, but, look, i want to back up. Im just relying on what dr. Fauci said dr. Fauci has been reversing some things that he said recently but there was this notion dr. Gottlieb talks about it of social distancing and how far the droplets can go. Look at the numbers in texas and florida yesterday. The droplets go too far inside and are fine outside so, i mean, Boris Johnson may want to do that, but that thats a way to have a second wave youve got to be like taiwan, you have to just have seven people dead out of 23 million. Rigorous, economy is probably the strongest economy in the world. I think chinas economy is strong because at the whipped it and the countries that havent i think its questionable. Im not sure that Boris Johnson is doing something that is in synch with the science yeah. And as you point out, jim, we are dealing with a high rate of infection here in terms of testing and hospitalizations going up in certain of these states but it doesnt seem to have having an impact on the stock market texas, and arizona and florida and a number of other states are significantly higher thankfully the death rate is lower, a younger cohort that seems to be getting it younger people do not suffer as well from the virus. Better treatment protocols as well thats good news, but the rates are going up, which is not good news at all and yet the market doesnt seem concerned i mean, the market sees opportunity in this is that covid index that i put together that is now about 12 trillion these are all companies that do well in the time of a pandemic i would have thought given it was my first pandemic that nothing would do well in a pandemic, but instead Tractor Supply does well, home depot does well because people want to make their home into an office, zoom we talked b i could go on and on the Companies Whose stocks are really popping are companies that do better in stay at home, work at home environment i mean, its amazing how well some of these companies are doing. They are not supposed to be well, but the market has nothing to do with the u. S. Economy. U. S. Committeconomy is small, mm sized business. Thats what weve been saying Something Else that has done quite well during this period of course is the Capital Markets in terms of new issuance, guys, as you know both debt and equity and it continues to pace ive been reporting for a couple weeks now on the expected offering of tmobile shares by softbank, it was announced yesterday after the close in a filing we can expect that deal to price after the close tonight. Weve all looked at tmobile shares how strong they have been in the face of this. Its about 198 million shares, previously i said it might be a bit less than 20 billion but now its going to be closer to 21 because of the move up in tmobiles stock price it does include a mandatory convertible, also a rights issue that tmobile will give to its shareholders as an opportunity for it to raise some capital should they choose to do so at the same price that this thing will be offered at imagine it will be lower than where it is right now, 21 billion worth of stock, obviously a big day for softbank which will reduce its stake in tmobile to roughly lets call it 8 or so percent, deutsch tell, they are not going to take them over 50 , they are protecting their voting rights, protecting their ability to consolidate the earnings of tmobile on their balance sheet, but overall masa did make money on the hedges and financing given he was financing in yen and things of that nature, but they are dramatically dropping their ownership stake as softbank of course has started back when they originally bought sprint, but a big deal that we will be watching closely regeneron, you are up 100 and change and black rock up 100 and change. And pnc selling almost similar in terms of numbers. We will see how tmobile does here again, an enormous sale. Goldman and Morgan Stanley shepherding that one a couple other quick ones, we talked about American Airlines yesterday, this he got it done 1350 is where they sold the 750 million worth of stock and they did do the convertible, 20 conversion premium, 6. 5 coupon and so thats another billion and a half there for American Airlines remember pg e, they will be coming out of bankruptcy very soon and they have about 4 billion in stock, common stock, that they are selling and another 1. 2 or so, 3 billion in equity linked securities as they prepare. That one has gone the other direction. That has gone down dramatically. There is recovery value in the equity, but its not what some had expected it would be when they remerge, but we will watch that closely debt Capital Markets, equity Capital Markets just on fire. Carl, people just cant stop misunderstanding the concept of liquidity. I think that we have to explain it almost every day to new people it means there is a lot more money sloshing around looking for a home and its finding a home in these stocks a lot of companies have had to eliminate their dividend, no longer income producing so you switch over. The more we explain liquidity the more people will understand that thats whats driving us. We have mentioned m2 money supply a couple times on the show, its a little wonky for Financial News on television, jim, but look at crb, highest since march, gold is getting near 1800, ten year break even highest since march. All that money is looking for homes and its going to drive prices higher, thats what a lot of inflation bulls believe. I think oil is up in part because of investing because driving while up is not up so much, but it doesnt everything is looking for a home and when you are looking for a home you are going to bid up stocks and the stocks that are down have to work hard to be dow down theres not much down today, jim. Yeah. Yeah exactly, carl. I mean, speaking of that i did want to quickly hit merck, if i can, back to treatments for the virus. Not a vaccine here, but, you know, a company that i featured a couple times, ridge back biotherapeuti biotherapeutics, a couple weeks ago signed the licensing deal with merck merck gets a positive writeup from Morgan Stanley which basically says they think investors underappreciate merck and ridge backs antiviral candidate which has blockbuster potential if successful. Reducing disease severity and risk an overweight rating there they are in trials now both for patients who have been hospitalized and those who are in early stages. They are in trials right now for that oriole antiviral and as i pointed out many times it would be so incredibly helpful because it would dramatically mitigate the severity of the virus and it could be taken early onset or even prophylactically if, for example, you were in contact with somebody and you were worried about it that could really change a lot of peoples behavior if it is successful. Im glad you brought that out. Merck is one thats in the race. That would be amazing. That would be that would be we would be playing football you pop a couple of those, you get out on the field yeah. I mean, you know, a couple of days, and, by the way, they also point out they understand the viral load peaks at 7 to 10 days, a good window for outpatient treatment to be impactful. Again, these are small trials right now, they are going to go to larger trials in july, but worth mentioning and worth watching closely, guys. Thats so positive. I needed to hear that. I needed something positive. Besides the market. Why why whats wrong . Well, because, david, a pandemic is not particularly a fun time i would like to see my family other than on fathers day i know. I sent them away. I would like you to see them, too. Kind of like in world war ii they sent their families in london away from the bombing i reading that book. Well, it doesnt mean that there is not opportunity for some, jim. I see sales force is a couple bucks from an all time high, they have in new partnership with siemens. They have done work about how to come back siemens is longstanding client. Im hoping mark will come on to talk about how to come back and how to do it i think people are struggling about whether to go back at all. When i say that its because if you if you do go back there is a protocol and the protocol should be very stiff for instance, people say, jim, why are you wearing this band . Its because i have my temperature taken and i dont have a temperature i keep it on so that, you knew, this is what everyone should do. Mark really is very pro mask, im featuring a hormel mask today. I will feature different masks if you send them to me marks protocol is what you can rely on. The stock has underperformed, his cohort, but his a nice move in the last two days for sales force. Com. The general take among the sell Side Community at the time was this is what you do if you want to attract clients for the long time. Mark is bringing them in with this effort and, by the way, he missed the last quarter because hes spending a lot to get these clients and the companies i had checkpoint on last night they are not spending enough and their stock has been stuck in the mud for many years if you spend in this market whether it be workday, whether it be salesforce, service now, these are companies, adobe, the companies that spend a lot, kupa software, they are the ones being rewarded with high multiples. You could say they are too high multiples, that is a matter of the momentum funds that radio you will in market right now as they get more money in and the index funds dont get as much money in because the momentum funds are generating amazing performance. You know, jim, though, i continue to hear from corporations this tone of the ability to potentially not necessarily hire back everybody that were laid off or looking for opportunities to save money as a result of the changes that have taken place, whether it be lack of inperson meetings or not needing to do that anymore i just continue to wonder about the overall fallout from all these companies in terms of employment. Some people are unnecessary thats whats been discovered. The splendid and the vile by eric larson describes an amazing time in britain. I recommend it yes, david, you are absolutely right. Holy cow, there are a lot of people who didnt come in, they didnt mean anything, which is really sad to be irrelevant. You want to be relevant. Guys, quick break here. We will talk to mastercards president and incoming ceo in a little bit about a deal they have going this morning. In the meantime s p 3150 or just about, Nasdaq Record high, vix is back close to 30. We are back in a moment. music anncr give customers access to precisely what they want, when they need it the most. With adyen, the payments platform that delivers convenience for all. Adyen. Business. Not boundaries. Mastercard a 300 billion Company Announced its purchasing open Banking Company fini city for 825 million this morning. Joining us now is thement and incoming ceo of mastercard michael miebach. Thanks for coming on squawk on the street. Good to see you. Thanks, jim thanks for having me good morning, everybody. This is a very interesting move by you because its really going into open banking which is kind of the plumbing for digital banks. Why did you have to do this and is it somewhat of lets say an offensive move against vees say which bought a company plaid that seems like it, they spent a lot more money on it not that long ago. Hey, jim. So weve been active in open banking for years. You know, there is a part of the world where this is regulated, europe, weve built our own organic platform in europe years ago, we went live last year, so weve been leading in open banking, we are all over the continent over there and we were looking to accelerate our strategy in terms of global expansion, so finicity is a fantastic partner for us, they have traditionally a very bankfriendly model in terms of what theyre doing, helping banks to do better credit decisioni decisioning, helping banks customers to apply for a mortgage or loan in a much more easy fashion here weve been in it, this is a logical extension of our strategy to get good tech, integrate teams so we are excited. I think that mastercard has always been a very technologyoriented company, but i am trying to figure out exactly how much of a digital bank you could be given the fact that you facilitate for so many other banks. Yeah, so we facilitate basically payments, we are not facilitating Banking Services as such, but by a move into open banking it is going what we do in terms of connecting banks and finteches to consumers goes beyond just payments there is a bunch of data transactions for example, if you are a consumer and looking for a broader choice in personal Financial Management solutions you could go to your bank but you could go to any one of the neo banks, other rising finteches and we would be the trusted partner in the middle that tafacilitates the transaction. It comes back to the role weve been asking in cards for year. Finicitys site is fantastic. Let me ask you about where we are in the economy the consumer card spending is it coming back as we open the economy and has it turned positive year over year yet . Jim, as we look around the world what we we are generally seeing is there was a first phase why every government around the world was trying to contain the virus, spending obviously as a result of that, people couldnt leave their house, they couldnt travel, it was spittingly impacted. Social distancing measures came along. Travel restrictions took hold and in the end things bottomed out and stabilized at a pretty low level. We have generally pass that had around the world so we are now in on a path to recovery, you know, normal things are normalizing as spending levels are coming back. There is a couple of markets around the world where we are net growth territory over prior year so theres italy, theres poland, theress tailia, those markets that have either been dealing with this for a longer time or have released their social distancing measures earlier than others. Here in the United States we saw 40 of the states already in that growth territory. You know, that new york city is going into phase two right now so well watch those numbers closely, but weve turned the corner and things are getting back towards where we were precrisis michael, thats terrific. I remember in the last quarter it was worrisome i was starting to think there couldnt be a reversal and thats very good in terms of avoiding any sort of serious recession. How about we ask about another side of things you are aware i guess more than almost any company out there about the growth of ecommerce ecommerce seems to have accelerated so aggressively in the last three months. What do you see the split between brick and mortar and ecommerce yes, jim, ecommerce has been on the rise for years, but clearly throughout the pandemic the last three months weve seen a further rise in growth rates on the ecommerce side, thats a domestic, even on the crossborder side where people couldnt travel, but still crossborder trade was still going on it is a more Digital Economy people didnt have the choice, didnt want to venture out of the house and go into the shops so they got used to Digital User Experience and often cases they found its actually not a bad experience so even if they were a consumer segment that wasnt traditionally focused on that, so clearly there is acceleration, but even for instore, were seeing a rise of Electronic Payments versus cash, so there is a clear anticash sentiment out there because people dont want to touch anything if they can avoid it, so Contactless Payments has been growing dramatically over the last year or so. We believe that these two trends are going to be trends for the longer run, so well see how this all balances out. Clearly consumer also venture into their local shops again to support the Small Businesses, but at the same time there will be things that they found so much easier over the last three months they were able to continue to do overall it will be a more Digital Economy. What does this mean for example for the Small Businesses it was a lot of businesses that will rebalance, so brick and mortar is important and will remain important but at the same time, you want to be a multichannel business and have a Digital Offering as well and thats a lot of the work that we do we get people job line and help them grow their business and get them back on their feet. Michael, to jims question about the rate of recovery in spending sequentially, are you on guard for any slowdown in that rate of recovery . I ask because today we got new travel air travel statistics essential will i that said the one week rate of change is slowing down, people surmising that maybe theres a bit of worry about a spike of cases in some states. Do you see that . Yes, so you know, our experience is we have the benefit of seeing this in all regions around the world when asia opened initially, there was a couple of markets that were going for a few weeks with lessened and reduced to no social distancing measures, and saw a spike in cases, as you just referred to and it tightened again. And of course, the impact on the economy in spending that we see is pretty direct, so this is not going to be a linear move around the world. So well see how it goes, something that we can see very closely but you know, markets are going back and forth to solved to its coming back so we see both of that michael, just quickly, wire car. I got to ask can it be bought was it fraud is there anything left wire card clearly topofmind issue. Weve been monitoring this really closely obvious ly theyre an important player in the industry right now theres nothing i can say on specific customerrelated topics but clearly top of mind and very much closely followed by us. Thank you, michael miebach. I dont think people realize how important your Company Really is and that information you give and things coming back, gigantic thank you so much. Thanks, jim thanks, everybody. Thanks for having me take care. All right, well take a break here back in just a moment. Where will you go first . Wherever you may go, lexus will welcome you back with exceptional offers on exceptional vehicles. Get zero percent financing and make no payments for up to 90 days on all 2020 lexus models. Experience amazing at your lexus dealer. Can i find an Investment Firm with a truly longterm view thats been through multiple market cycles for over 85 years . With capital group, i can. Talk to your financial professional or consultant for investment risks and information. Talk to your financial professional or consultant you say that customers maklets talk data. S. Only Xfinity Mobile lets you switch up your wireless data whenever. I accept 5g everybodys talking about it. How do i get it . Everyone gets 5g with our new data options at no extra cost. Thats good. Next item corner offices for everyone. Just have to make more corners in this building. Chad . Your wireless your rules. Only with Xfinity Mobile. Now thats simple easy awesome. Switch and save up to 400 a year on your wireless bill. Plus get 200 off a new Samsung Galaxy s20 ultra. Its time for jim and stop trading. Carl, a lot of companies were shorted during a period when we thought it was recession, thor, camping world and yeti, all the companies have come back dramatically because the short story didnt pan out and the outdoor story did pan out. Yetis are given as part of companies branding. Piper comes out says buy the stock. Peloton is similar they changed the world you use Everybody Knows yeti now its a great stock, it goes higher jim, you mentioned peloton. Yesterday stifel did a straight shy 62, today cowan high 70. Theyre oneupping each other. It is hard to get one. Theyre saying its no longer just a bike. It is a Technology Company and when that happened to tesla, look what happened so the market finds new ways to describe stocks and make them more exciting. If they ever come up and say volka materials is a textile company its a rock company, i know its late in the game jim, how about tonight . I got john denver singing no, we lost john denver a long time ago, david. He was the best. Pat brown of impossible, they have news and lands end, not a big company but they know about directtoconsumer this was a great show and holy cow, im going to send david thank god im a country boy send you a little cd, maybe i could do that with the new watch. Siri i didnt say i didnt like him. I just questioned it a little bit, and then you go out on twitter and make it sound like im his, you know, biggest crit critic, not the case i will happily listen. Who is david faber . Here is Contact Information for david faber. Hey, stop it knows you but i wont give your Contact Information. Yeah, darned right it knows me all right, thank you what a world. Well see you tonight, jim. Mad money that will be a good interview, of course, Starbucks Launches that impossible partnership pat brown with jim on mad money tonight good morning, everybody. Welcome to squawk on the street. Im Carl Quintanilla with david faber and Morgan Brennan coming to you live from various locations. Pretty good breadth here as the market had a wild overnight on futures as navorro clarified the comments about the china trade deal nasdaq above 10k, vix below 31 morgan, a lot of cross currents as we get new home sales in a few minutes. Yes, a lot of cross currents. New home sales which will be one of the key gauges of Consumer Sentiment and something were watching we had the pmis overnight, better than expected numbers out of the uk and europe and the reading about 15 minutes ago here in the u. S. Not as good as estimates had expected in terms of the pmi numbers and u. S. Business activity did contract for the fifth straight month in june but that the pace of the decline is easing so again, signaling that there is a recovery emerging here but of course the question is and is going to be how quickly that recovery takes root, what that looks like and of course what it means in terms of the markets, and the huge, massive move off of the lows that weve seen in the last three months for the s p yes, we got existing home sales yesterday. Lets get new home sales this morning with rick. Hey, rick. Reporter hi, carl, much better than expected looking for a number around 625,000, add about 50. 676,000 seasonally adjusted annualized units so a strong showing for may and of course we know that the rest of the market with regard to equities and whats going on with the pmis is showing improvement, and to see exactly where most of this growth occurred, lets head east and ask diana olick. Diana . Reporter rick, this is a huge beat for new home sales in may and quite frankly, i thought the expectations were a little low, looking for up 1. 9 we got much higher than that, up 12. 7 year over year in may and thats after we saw that huge jump in home Builder Sentiment in june so you had to see this coming remember, these numbers are based on signed contracts during the month, not closings, so people out shopping during may, just as things might have been starting to open up in some states or people were getting more used to the virtual tours, a lot of the builders saying they got a lot of sales from people online who never walked into their models. You did see a big jump in price up to 317,900 this may be a mixed shift but Something Interesting in the data is there was a big jump in the number of homes sold that were not yet even started. Now, we saw Housing Starts much weaker than expected in may and that was probably because the builders were worried, are people really coming back . Is this a fluke . Clearly theyre coming back and theyre buying homes that arent even built yet so we should expect to see those starts pop up in the next couple of months. The supply of homes for sale also at a 5. 6 month supply, lower than previous months but much higher than the existing home supply of homes for sale and thats why the builders are benefiting so much is because there is so little supply on the existing side and so much demand from potential buyers who are looking for new, looking out in the suburbs where the builders build and they want high tech homes as well so they can work from home and so their kids can do school from home so again, a huge beat for the builders, this should move the stocks pretty well back to you, morgan. Yes, diana, just to dig into that a little bit more, i wonder how much of it is a reflection of the fact that in places like for example new york, realtors couldnt show some of those existing homes as well versus those new homes that youre talking about right now, and whether thats also specifically a reflection on the economy over the past or the closed down status so much of the economy over the past month or so. Reporter new york was really an outlier when you look at new construction, youre not looking at homes particularly in manhattan. Thats existing homes or new condos these are Single Family home numbers so you have to take new york out of the mix that they were closed down the rest of the country except for a lot of pennsylvania was open for business, virtual, online, real estate acts doing Facebook Live tours for them this shows the incredible pent up demand from the spring that is starting to show up in the may and june numbers diana olick for the latest on that whip saw action for stocks overnight after contradicting comments from white house trade adviser Peter Navorro on the status of the u. S. china trade deal eamon javers will break that down for us. Reporter it was a Peter Navorro roller coaster last night after he talked about the china trade deal with Martha Mccallum she asked this question and he gave this answer do you think the president sort of, he obviously really wanted to hang onto this trade deal as much as possible and he wanted them to make good on the promises because there had been progress made on that trade deal, but given everything thats happened and all the things you just listed, is that over its over reporter so navarro saying its over to the trade deal. Investors assumed he meant that meant the United States was pulling out of the trade deal. That sparked this instant selloff in dow futures overnight. Look at the chart, you can see the cliff where it drops off in the middle of the chart there and then it rallies back just as quickly. Why is that . Well, because Peter Navarro put out a short statement which he said my comments have been taken wildly out of context. They had nothing at all to do with the phrase one trade deal which continues in place i was simply speaking to the lack of trust we now have with the Chinese Communist party after they lied about the origins of the china virus and foisted a pandemic upon the world. Short a after that statement was released the president just to reinforce the trade deal is intact and gave investors heart to go back and buy and drive the rally we saw late last night in the dow futures as well. Morgan, all of this highlights the tensions within the Trump Administration around the issue of china the bolton book, the john boltian National Security adviser book that came out last week showing scenes in which bolton says the president of the United States was pleading with chinese leader xi jinping to help him win his election in the fall by buying Agricultural Products and helping the president in farm states the white house has been at pains to deny that saying they are not working with the chinese. Theyve never asked the chinese for help in the election the president has been trying to appear to be tough on china. These navarro comments are in that vain but perhaps he got ahead of himself and suggested something that he didnt mean to suggest. In any case, its all patched up now, morgan. Back over to you yes, and certainly the chart tells the entire story for us. Eamon javers, thank you. Also wonder what this means for phase two talks. Reporter you bet we will get to that another day perhaps. So this is where well begin this morning what were seeing in the market, after initial steep drop in futures the stocks back in the green after that clarification alley mccartney and leo kelly join us now. Good morning to you both ally, ill start with you, whether its the trade angst, whether its the increase in coronavirus cases in a number of states and also hospitalizations, whether its the data weve been getting out this morning, and overnight, what is driving the market right now . The market, since basically quarantine, has been driven by our fast and furious fed, which has been followed by Federal Reserve support around the world that sun precedented in scope and extraordinarily targeted there are also two other things which are driving the market and i think will continue to produce volatility, one of which was evidenced last night which is continued conversations and tension and volatility around the collection, china rhetoric is going to pay a large part of that taxation will also pay a large part of that the other thing is simply the second wave. Now, obviously weve seen both in this country and in asia, significant second waves but that seems to not be affecting the market in the way in which a lot of us thought it would, and again, that just simply goes back to the fed. When you look at the amount of stimulus, the amount of money m1, money supply thats been put into this economy, in the last three months our money supply year over year has grown 34 there is a strong correlation between year over year growth in money supply and not surprisingly in multiples in valuation and in equity prices and i think this is really, again, fast and furious fed is really tough to fight on a micro level. Yes, and certainly theres no denying what the feds policies have meant to this market. Along the lines, i want to get your thoughts on this topic, leo, especially since the market is really at least now pricing in a quick recovery to normalcy. The s p retraced, what, 75 of the losses in less than three months how sustainable is that . As long as the pace of change continues to improve i think its sustainable while we look at economic data, its not as good in any measure as it has been, it is improving. It is improving consistently and that pace of improvement is actually accelerating. More importantly, in the world of the science, were seeing that improve dramatically, so when we look at whether its vaccines or its therapeutics, there is so much going into that solution all at one time, money, brain power, that is developing very, very quickly, and that gives hope that were going to open up quicker and have a much faster recovery. Add to that the fed, add to that the stimulus, and all of the cap poured into the system and its not surprising that we have a recovery now in terms of valuations, obviously there are pockets of the market that have really shot up and are starting to reach extremes there are some significant valuation gaps in the market between certain sectors and industries, and i think investors just have to be very smart and disciplined at this particular time. I think the biggest mistake an investor can make is trying to match the volume of news flow with the volume of activity in their portfolios this is a point where you have to be smart. Its good to have a little cash on the sidelines expect volatility and be mindful of two things, your allocation, your targets, and what the valuation is in the market discipline is the call here especially after a run this significant. Yes, alli, how are you advising clients right now markets at the levels theyre at, where are you suggesting they be invested in, and what does portfolio diversification look like right now . I would have to agree with the comments made earlier. I think diversification and discipline are key stay invested. Again, the market is very wellsupported asset managers, a lot of hedge funds have a lot of money on the sidelines to continue to sort of buoy up risk asset themes. I think you want to go to again the points that were made to the l laggere en laggers. The uk is a valueoriented market that has been sort of unfairly hit as a result of that longterm themes, the amount of money that has gone into the ipo highyield market and just in the intellectual Capital Research market of a lot of longterm Health Themes is going to create i think a lot of upward movement, whether you do that through the public or the private markets to play oncology drugs or growth in genetic therapies but i think, think longterm, dont be too cute stay diversified its a great time for alternatives to that point, if i could and finally, leo go ahead. I was going to say to that very point, theres a lot of cash in the alternative markets and private equity has an awful lot of cash. This move down and back up was so fast that there wasnt time to adjust the amount of money flowing into private equity and what weve just had here for private equity is maybe the most astonishing stress test in history, and so if fresh cash is going into the private equity markets today, there is yield. There is opportunity in buyout, there is opportunity for this incredibly unique moment for private equity to discern the real strength of businesses and other Financial Assets that didnt exist prior to the covid market in fact, i think we were getting a little too laxed in some of that Due Diligence across the private equity market, witness wework today, theres going to be a lot more discerning eye so maybe not the high flying exciting market we had, but i think definitely a market where returns can be achieved back at traditional levels yes, okay, we have to keep an eye on that. Thank you both for joining us, alli and leo, with the major averages in the green right now, although off the highs of the morning. The s p is up about 0. 75 . Session high was up 290 Robert Johnson will join us when we come back, founder of rlj, b. E. T. And the movement to fund minorityowned businesses, when we come back when the world gets complicated, a lot goes through your mind. With fidelity wealth management, your dedicated adviser can give you straightforward advice and tailored recommendations. Thats the clarity you get with fidelity wealth management. With spray mopping to lock away debris and absorb wet messes, all in one disposable pad. Just vacuum, spray mop, and toss. The shark vacmop, a complete clean all in one pad. The nages first black billionaire, Robert Johnson is speaking out about the black lives matter movement. Mr. Johnson is encouraging the formation of a formal independent black Political Party built on the principles of the Congressional Black Caucus of 1971. Robert johnson as you know is the founder and chairman of Rlj Companies and joins us great to have you back good morning good morning, glad to be here guys and morgan. You were on squawk box a few weeks ago talking about reparations and now this youre definitely thinking big what leads you to the idea that a new party, an independent party is whats needed well, ive been convinced for a long time that 40 million africanamericans who tend to vote as a block in one of the two parties limit their leverage in getting action from both parties, and i think its time that africanamericans form an independent party, not be an appendage of one party or ignored by the other party and using their leverage in a democracy to say we stand for things that are principally focused on the interests of the 40 million africanamericans and not have that diluted by trying to be a part of another party where the interests may diverge and oftentimes do diverge and its been a fact that had africanamerican interests been fully embraced by one or two of the dominant parties, we wouldnt have the tremendous social economic racial issues that we have now so i guess i have two questions. One is how do you build this from the ground up, the infrastructure alone would be a huge challenge would you stage your own candidates would you otherwise endorse democrats or republicans how would this work . Ultimately, an independent party, and this happens in all multiparty democracies, they run their own candidates in various jurisdictions. They run them on the local level, state level and obviously at the national level, and because this country sort of operates on the Electoral College approach to deciding who is the president of the United States, moving votes from one candidate to another can ultimately determine who is the next president of the United States all you have to do is look at what happened with secretary clinton. The low turnout of africanamerican votes in key battleground states ultimately gave the election to donald trump. So africanamericans, because they vote as a block, can have that balance of power. The fact that it is an Election Year and to get a new Political Party off the ground probably would take some time, what are the policies youd like to see put forward by the candidates right now well, i dont see this happening this year, but i do see the discussion about it hopefully happening this year. As you can see, the Democratic Party is terrified of the notion that black votes might vote a protest vote at the top of the ticket or decide to sit this out. Thats exemplified by the most amazing thing that i ever heard white democrats say when joe biden said even if you are thinking about not voting for me, in his words you aint black, that is a horrendous statement, but it also reflects the need for black independent party that someone can be so presumptuous that you have to vote for a democrat or otherwise you are not identified as black. That is the principle reason why we need a black Party Independent to change that kind of behavior so that were not as i said taken for granted by the democrat democrats and ignored by the republicans because the republicans basically say theyll never vote for us so why do wei want to engage in a dialogue in the interest of 40 million africanamericans. Robert, its david faber. I wanted to ask you a business question but let me just follow on what youre talking about first, which is i wonder, though, if this were to happen would you really have National Power . Could you ever get to an actual level in each state where you would really have power or in some ways are you better off having one of the national parties, the democrats more fully reflective of whats important to the black community . David, in business, as in politics, what you want to have more than anything else is le r leverage and black americans proved that in South Carolina that joe biden would not be the presumptive nominee today if black people had decided they were going to go someplace else. So black people have had the power. They just simply have not exercised it so the idea of saying to the democrats, hey, you guys do better and well stay with you, black americans have tried that for years since the day blacks switched over from voting republican to starting voting with democrats and at the same time the republicans have said no sense talking to black people about coming on board with us because theyre emotionally socially whatever locked into the democrats. Why not black americans step back and say we may run senate seats, congressional seats, we may run local mayor seats and just as they do in multiparty democracies across the board, theres no reason theres nothing in the constitution that says we should only have two parties inthis democracy theres nothing there. Other countries do it. And they split the vote but you can leverage that power in a way in your best interests, not in the interests of the twoparty system right all right, robert, let me ask you a business question while weve got you here, given your deep knowledge and long history in the cable distribution business or at least as a content provider of course at b. E. T. And as somebody knows the sports leagues well im curious your thoughts about it, if youre a cable distributor paying for espn, paying for all these Regional Sports networks or if youre an owner of the team, how are you viewing this moment . Are the cable distributors going to finally throw up their hands and say enough, were not paying any more for, given that were not getting any live sports . Well, david, interestingly enough, i said this many years ago at one of the company conferences as you know, i said then at some point, the cable industry bundling Cable Services to consumers, where they have to pay for a is more gas board of content of which they only watch a fraction of all the pieces that theyre paying for was a model that would not work in the longterm, when digital alacart choices became available those choices are available now. The cable industry cant keep paying basic fees for 70, 08 channels of which the population of customers only watch some 18 or 17 of the channels that they offer. So the cable industry has to get off that model and go towards a model of alacart programming letting People Choose what they want to watch. The sports leagues have the advantage that its very hard to find another product that attracts male consumers and customers the way male sports does and i think that as long as they can come up with the rational compensation model from the districtors of which the customers have to pay for and it will work. Ultimately, i believe that a payperview model because the economics are so great, will ultimately prevail in sports programming that people will buy the sports they want to buy, rather than buying everything that a sports channel puts on, and its already happening with the nfl on directv so people are smart. They make choices of what they want to see, when they want to see it they dont believe in the idea, in order to get one game, i got to buy 30 games or 30 programs that i have no interest in watching if im a Dallas Cowboys fan, which i am, if im happy buying dallas cowboy games, im not concerned about some of the other games, and that ultimately is going to happen just as sure as weve seen now where basic channels are being, Cable Operators saying why pay for these channels where i have a fraction of viewers and viewers are moving to streaming and thats why i got into streaming in a partnership with amc with two channels, acorn tv, a million plus surprising and an urban movie channel for the same reason because you cant sustain these channels for customers who dont watch them its just a fact and the ease of a push button to make it easier to make that decision is a further factor in saying why do i need to do this when i can watch what i want to watch yes choice matters we got to run, robert, but really quick, on either reparations or your idea for a new party, have you discussed it with clyburn did you ever talk about it with cummings or the president or joe biden for that matter . You know, ive been talking about reparations for several years. First of all, other black folks have been talking about reparations long before i got into the game. I got in the game because as a businessperson i understand how wealth flows reparations the wealth from reparations is a pay back for wealth that came from slavery. Now, the one thing i know, people are saying joe biden will say im not paying money for people who i dont know who are dead Mitch Mcconnell will say the same thing, and the Democrat Members of the caucus tend to tow that line. One thing you and carl and morgan know from the understanding of money, money does not die slaves may die, some of the ancestors may die, money doesnt die. Money circulates, indeed money multiplies and if i had some accountants and actuarials, i could trace every dollar of slavery to the wealth of every american in this country so reparations is simply a way of transferring back to africanamericans what was stolen from them from slavery through jim crow segregation and racism, and thats all it is, and its been done before, the descendants of the jews were paid by the descendants, people that allowed naziism to happen this is not question the question really is, why the americans should ask themselves why shouldnt we do this, not do we deserve do they have a right to it. The question is, why wouldnt you do this . Robert, thanks for the time youve definitely launched a conversation now on a couple of different fronts and well have this discussion again hopefully soon well talk to you hen. Okay. Look forward to joining you guys take care. You just heard the conversation about sports in that interview as well so its time for our etf spotlight. Toot the round hill Sports Betting and gaming etf, timost etfs take at least three years to hit if not longer rookie investors and newcomers to the market betting big on betz with a return of some sports imminent. You can see right there its up 2. 5 dont go anywhere. Squawk on the street returns in two im enjoying the stock stuff. Dvtg made our mark, so its been fun but im a sports guy im a sports better. I want sports back and when it comes back, thats going to be where my focus is, but for now, mes t sckg fun withheto ga ayou well know. You should be mad your neighbor always wants to hang out. And you should be mad your smart fridge is unnecessarily complicated. Make ice. Making ice. But youre not mad because you have e trade which isnt complicated. Their tools make trading quicker and simpler so you can take on the markets with confidence. Dont get mad get e trade and start Trading Commission free today. Can i find an Investment Firm with a truly longterm view thats been through multiple market cycles for over 85 years . With capital group, i can. Talk to your financial professional or consultant for investment risks and information. Im frank holland. Here is your cnbc news update at this hour. The second president ial debate is getting moved to florida after the university of michigan withdrew from hosting the debate over covid19 concerns it will now be held at the adrian arch center in miami. Novak djokovic has tested positive for covid19. He is the fourth player to become infected after playing in a tournament that djokovic organized in serbia and croatia. British Prime Minister jbori johnson announcing a major loosening of lockdown restrictions including the opening of pubs, restaurants and movie theaters starting july 4th and the government advising people to stay three feet apart rather than the previous sixfoot recommendation. The former ceo of wirecard is arrested on suspicion of falsifying accounts after the payment firm disclosed a 2. 1 billion hole in its balance sheet. Thats our cnbc news update for this hour. Squawk on the street returns after the break. At mercedesbenz, nothing less than worldclass service will do. Thats why were expanding your range of choices. Many dealers now offer optional pickup delivery and athome maintenance, as well as Online Shopping with Home Delivery and special finance arrangements. So, whether you visit your local dealer or prefer the comfort of home you can count on the very highest level of service. Get 0 apr financing up to 36 months on most models, and 90day firstpayment deferral on any model. Our next guest is a florida Restaurant Owner taking a Second Chance onreopening, having previously tried earlier this month, the galley in st. Petersburg has been closed for ten days now, coming back tomorrow with a list of new Safety Measures that were not in place the first goround the galleys owner pete boland joins us to discuss the ups and downs of trying to open a strau restaurant and keep it open. Go through it for me you were closed, then reopened, closed again and as we said now poised for opening again what have you learned through this is there a rule book at all that you can follow thanks for having me, guys. Certainly there is no playbook or rule book and we were open the entire time during lockdown to takeout business been we had pretty good takeout business going along and then the dining rooms reopened here in florida, with some restrictions on may 4th and there was just a lot of confusion and a lack of synergy between city, county and state and some confusing guidelines but we did the best we could and were really forging ahead in the community with the huge supportive role here for us and really came out and put their arms around us and then we started having some people that werent feeling good the beginning of june and we told them to get tested and kind of there was a little bit of a dom know effect. Were such a popular bar and restaurant scene down here, theres over 250 bars and restaurants here in downtown st. Pete, and people just kind of glob together, they hang out together, they live together, they work together, they love together and we had to come and make the difficult decision back on the 12th to close down in the middle of friday Dinner Service and its been a little bit of a tricky time, but we felt confident to go forward and try to get everybody tested and really try to be responsible to make sure the safety of our guests and both of our staff yes pete, listen, we can appreciate the difficulty of what youre dealing with there but i have to ask, i mean, cases in florida are going up they continue to go up dramatically you had employees who have tested positive for the virus. How do you deal with that now . What are you changing in terms of your protocols that gives you confidence youre not going to keep getting employees who keep getting the virus . Well, i think the market has certainly responded since we kind of started the domino effect, theres been several other bars and restaurants, two dozen in our area. The markets responded that people arent going out as much right now. There was certainly some confidence as far as going out back in may, if you asked anybody in the streets around here, no one knew anybody that was sick and now just Going Forward, were trying to be a little bit more stringent about things theres a new mandatory mask policy for staff and now patrons here in Pinellas County that are starting this week so we just got to be a little extra cautious i think a lot of people let their guard down we did a full sanitizer treatment with the local company here were just going to dot best we can and try to maintain some optimism and a lot of positivity and try to give people solace of having a nice meal and being able to be with people where they can safely. Yes, pete, you just mentioned theres really no playbook and some of the guidance has been conflicting across Different Levels of government i wonder as a business owner, do you think face masks should be mandated by the state . You know, as a general rule of thumb for me, im pretty much against new ordinances and laws that are difficult to enforce, and we could probably go down the rabbit hole about the idea of more regulations, but i think its probably a good move right now just to make people feel more comfortable were in the comfort business here in hospitality. We want people to feel comfortable and it seems to be a change that theres a mindset change here in our community where people are Going Forward with it. My staff certainly doesnt love it they were doing really well all throughout may no one was getting sick and once we started opening the dining rooms and people started coming in, it feels like the patrons were the ones that got our staff sick, so were just going to go forward and follow the guidelines and be responsible and try to get through this thing, hoping that some of this fear will subside here over the course of the summer yes, well we hope so, too, but the fear may subside only when the viruses subside pete, what about your business what are you anticipating when you do reopen in terms of whether youll see similar crowd sizes that you did when you were open previously . I dont think its going to be like what happened with may people were so excited to be coming out back in may we also had tourists from all over the u. S you think about all the places that were open florida was definitely the most fun place and downtown st. Pete is a dynamic, fantastic, fun place to be. Im expecting kind of a slow start. I think its going to be a little bumpy in the first couple weeks. Were just really attached to the community and were just blessed, were born and raised here in st. Pete, were the true locals place i think after about two weeks, where people start, things starting to cool out a little bit well see more response. A lot of our guests cant wait to come back to support us yes, we bush ywish you the bf luck as you reopen again and appreciate you taking some time with us, thank you thank you guys very much. Pete boland dow is up almost 200 points. Notable alltime highs this morning including net flick, apple, amazon a doebie, miost,crof nvidia, spelunk, spotify, facebook and others were back in a minute the tempurpedic breeze makes sleep. Feel. Cool. Because the tempurbreeze transfers heat away from your body. So you feel cool. Night after night. During the tempurpedic summer of sleep, save 500 on all tempurbreeze mattresses. Can i find an Investment Firm with a truly longterm view thats been through multiple market cycles for over 85 years . With capital group, i can. Talk to your financial professional or consultant for investment risks and information. Jim paulson sees three reasons the market is headed higher, despite the emergence of new hot spots across the nation. Find out more on tradingnation. Cnbc. Com more squawk on the street coming up. For as little as 5, now anyone can own companies in the s p 500, even if their shares cost more. At 5 a slice, you could own Ten Companies for 50 instead of paying thousands. All Commission Free online. Schwab stock slices an easy way to start investing or to give the gift of stock ownership. Schwab. Own your tomorrow. Can i find an Investment Firm with a truly longterm view thats been through multiple market cycles for over 85 years . With capital group, i can. Talk to your financial professional or consultant for investment risks and information. Talk to your financial professional or consultant ever somethings gone mogotten into the office. M, i hear you. Feels like theres no barriers between departments now. Servicenow. The smarter way to workflow. Employers continue to get extended and increased benefits on unemployment. One key question, when the people are wanted back to work will they be willing to come if the benefits continue to be extended Steve Liesman takes a look at that part of the story, one weve been hearing a lot about, steve. Not quite sure where the truth lies its a big debate for the outlook and recovery, because if you have this problem of continued unemployment, the recovery might be linked and this 600 has been beneficial to the economy. Its helped retail sales, helped bring down poverty but the question is when it runs out in july, what should congress do with it . A lot of people focused on this paper from the university of chicago researchers that shows the unemployment benefit plus the 600 bonus relative to the medium wage is well over 100 in most states. Could you see the darkish purple areas where its 161 to 177 of the median wage, raising the question, will people be deterred from going back to work i have to say at the same time theres been some research that weve done and others, Ernie Tedeschi finds no correlation between higher unemployment and the higher level of Unemployment Benefits some economists say you know what the reason is people want to work. Check into some of the reasons people give. Theres concern about not getting your job back in a really lousy market. You want to go back to work to get your benefits resumed and some employees cant go back to work, its not really because of the payment, its because the schools are closed and theres millions of people who arent getting benefits anyway so they would be available to come back so its more than just the money that would keep people away, and the money in some cases wont keep them away anyway. So Michelle Meyer from nelp, the National Law Practice program says we should not overlook how critical it is for workers to maintain their connection to a job right now. For so many its more for a job than a paycheck. Democrats want to continue the 600 bonus through january 31st, which many economists say that could create too much incentive for people to stay home. An idea from the republican side to provide a 450 returntowork bonus and another idea to prorate the bonus for the state unemployment level this way it would come down as the unemployment level came down, wouldnt leave people high and dry without benefits vice President Joe Biden is saying one of the things they should do sin crease worksharing subsidies where you spread out the lost hours among different, among all the workers and this government pays for that david, ultimately, this idea that people will stay home and not take a job for 600, well, theres some truth to it but maybe more is being made of it than should be david . Or morguen actually, ill take it, steve. Definitely some key context there given the fact this has become a much bigger xl politicplit political debate coming up next hour, dick costolo weighs in on the surge in tech, the latest out of wwdc and a lot more, plus the creator of the email app pay, after a rare reversal from apple, they have a big show at the top of the hour and of course as the nasdaq is up almost 1 , hitting another record intraday high today, so dont miss it. When the world gets complicated, a lot goes through your mind. With fidelity wealth management, your dedicated adviser can give you straightforward advice and tailored recommendations. Thats the clarity you get with fidelity wealth management. Wherever you make go, lexus will welcome you back with exceptional offers. Get zero percent financing and make no payments for up to 90 days on all 2020 lexus models. Experience amazing at your lexus dealer. Swithout even on yoleaving your house. Experience amazing just keep your phone and switch to Xfinity Mobile. 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You are creating the future on the fly. And we are helping you do it. Vmware. Realize whats possible. Cool . Drop the taco. Get in the car. Does this sentra feel like a compromise to you . Wait, what. . The handling is good, right . No compromise there. Nope watch this. Umm. Bbrie. Brie brie rear automatic braking. So if this Nissan Sentra isnt gonna compromise, why should you . Youre right atta girl. The allnew Nissan Sentra. With more standard safety features than any other car in its class. Welcome back our next guest runs the worlds alarmest Online Thrift store now saying the resale market will more than quadruple in the next five years. The ceo of thread up, james reinhart, joins us thanks for having me. Great to be here i want to start with this walmart partnership. A massive retailer a massive expansion in terms of audience and potential sales how are you pressumeasuring fort what are the opportunities here . This has been a in the makin about how to we bring a large selection of secondhand apparel to the walmart customer. You can shop nearly a million uniqueyounique items on walmart. I think walmart is very excited about the idea of having Premium Brands at walmart like prices. It is really expanding their selection. This is e commerce focused. As we have seen e commerce sales continue to surge, what have sales been like for thread up, and perhaps more tellingly, how have customer a types for different pieces of clothing or apparel changed . Yeah, secondhand has been a bright spot. In the report that rewe released today we looked at how secondhand and resale has out performed traditional apparel. I think the fact that everything we do is online and we dont have the same store e pxposure, and it provides great brands at really great prices. When consumers are feeling uncertain about what theyre buying, what their job prospects might be they shift into value and resale is really a value opportunity for the consumer i think it is an exciting time for resale even though it is uncertain for the rest of us the question of what is going to sell, right we had Mickey Drexler and asked him how are people going to dress as we try to painfully make our way back into some routine of going back into the office or establishing a permanent workplace from home . I think the trend of the casualization of the workplace has been under way for some time i think the data that were looking at shows that people definitely are trading down into items that are not as flashy we joke that were definitely selling more tops than bottoms you know, i think as all of us have to have our heads above the fold, so to speak. But that trend is real and i think the move towards more comfort and athleisure wear rather than workplace ware i think brands like j. Crew and ann taylor who sell go to work wear and go out wear to be strained i think were complimentary data to that. Yeah, more tops than bottom, i can peak to that, i think many of us can. You know i wonder in terms of this partnership, the largest physical retailer in the country, but what other partnerships conceivably could you see down the road that will aid your business . We are a Large Business where we connect buyers and sellers every day. Where we experience that now is reselling for brands and retailers. Were seeing Department Stores like we did with macys, jcpenney or made well, they know that resale is on the ride and people are shopping secondhand more than ever before. So we think about this as a platform that a department store, a brand, anyone can plug into to bring resale to life for their consumer were excited and we have been heads down working on it for the last few years could you make a bigger push into fashion in general. They Just Launched their first big style sale yesterday that is going on this week i think anyone should be fareful when amazon enters their market and i think amazon will continue to do very well in any category in which they operate i think the difference is that apparel is knew. And one of the great value opportunities is that everything is 80 off. If we move into a recessionary climate, anything sold on amazon will be sold on thread up at 70 to 80 cheaper i believe amazon will continue to sell a lot of clothing, i dont think they can couldnt to compete with the prices that someone like thread up can compete with consumers are looking to pay less they want can great brands at great prices and thats where secondhand really competes yeah, 80 off that puts it into perspective. James reinhart, thank you for joining us today thank you for having me okay, in the meantime, everyone, welcome to squawk all alla alley we have a new record high on the nasdaq the vix is down a little bit new highed for adobe, netflix, and apple. Were going to break down everything that we heard yesterday and talk maybe a bit, josh, about the things we didnt hear that is right, apples big Software Show this year did feel different. It was free. Entirely virtual but some things did stay the same tim cook did still take the stage to highlight a slew of new features that developers can now expe expect ios 14 was announced a future called car key. Drivers can use their iphones to unlock and start their vehicles. And also sleep tracking features for the apple watch. But the big headline may have been hardware. They will releas