Ton and the protests following the killing of george floyd, the Economic Cost of inequality. On the virtual round table, my colleagues bev leveson, carlton english and jack howe. So an old generic steroid proved to be really beneficial for covid19 patients, and the market moved higher on that news, jack. This is another reminder that this is something that wont kick into full gear until medical science makes some advances. Thats exactly right. Ive been limbering up my lips to pronounce some long words because i want to tell you the good news about dex methadone and say goods things about remdesivir. We started with week with the fda revoking the authorization for the chloroquine and hydroxychloroquine. But a day later we got results from a trial in england, and this is aster oiled, dexamethasone, and it was proven to reduce risk. And that brings us to three in terms of proven treatments for covid19 right now. The others are convalescent plasma where you use the blood of patients who have recovered from covid19, and youve got the gilead drug remdesivir. I spoke with the ceo there, dan oday, for my barrons street wise podcast this past week, and he says theyre looking at ways to expand the usefulness of that drug. Lets listen to a clip. Doing formulation work to see if we can, instead of this being given as an intravenous injection which it is today, we believe we may be able to provide this inhaled version which would be less invasive, of course. Keep in mind weve only been talking about drugs that Companies Already had before the pandemic that theyve repurposed. We saw the first drug that was specifically made for covid199 go into trials this month 19. Thats from regeneral ron. We should hear results in september. So the point is there are more and better Treatment Options becoming available. Jack and this is so important because weve seen now even while new york is Getting Better, a lot of other states cases are spiking, so weve got to make some progress on the medical front. Ben, i want to turn to you about tech stocks which, of course, have been whats powering this market higher for a long time. And to the extent that theyve gotten pretty pricey. So barrons took a look at tech stocks that have good prospects but arent quite as expensive. Thats right. My colleague, erin, took a look at eric, took a look at it can stocks, and i didnt realize the expensive tech stocks had gotten even more expensive. The ones that had started the year with 10 or higher have gained 35 . One that he liked was intel. Its been having some trouble with some competition from amd and also apple deciding to use some of its own chips in it computers. But the stock is cheap enough at around 3. 5 times sales and still such a big chip provider that it looks really interesting. Others like Western Digital also look pretty good. But theres still opportunity out there in tech, and i think especially as the economy keeps Getting Better and things continue to reopen, youre going to see some of these lower priced tech stocks do a whole lot better. Jack as were going to hear from hugh delaura, tech is clearly driving this economy. I want to turn to a different topic. One of the interesting things about covid19 is that it has accelerated all sorts of things that were already in place precovid. We know about amazon and ecommerce and all that, but another one is inequality. And, carlton, the barrons cover story this week looks at why inequality is a problem for the market and the economy if it persists. Absolutely. So a fantastic piece this week, everyone should realize it. Weve heard a lot of different letters that this recovery could wake the one we should Pay Attention to is k. The top 10 of employees who 84 percent of the stock market, theyre invested in the stock market. But were seeing this continued downward a trajectory for lower income workers e, those who have been laid off or working in industries that arent expected to recover as quickly. And we also have to note that 40 of the people who lost their jobs in this cycle were earning less than 40,000 a year. Even before this crisis, we saw that the top 1 of the economy accounted for about 20 of total income while the bottom 50 accounted for only 13 of income. Jack carlton, there are a lot of reasons to worry about that, but can you explain why this will weigh on markets and the broader economy in the future . Absolutely. So what we know is in the u. S. We are actually lagging other developed nations in terms of having a strong middle class. Less than 50 of the population is considered middle class or better. And what that means is lost opportunity. So every incremental bit of income has a Multiplier Effect for lower income people. They put it into the economy right away in terms of consumption, or longer Term Investments in health and education, its things like that that really grow the economy long term and, of course, would have benefits to growing earnings as well. Jack how long ago henry ford explained that if his employees werent paid enough to afford cars, that wasnt going to be good enough for his business. Thanks a lot for explaining this, carlton. Coming up, how Smart Devices and the internet of things is expanding to ecommerce and more. Honeywells hugh delaura is next. vo at audi, we design cars that exhilarate with versatility, whether on the track, or the everyday drive. Today, that philosophy extends to how we connect with you. We call it, audi at your door. Whether a remote test drive, shopping, tradein, or even service pickup, audi at your door can do this and more at participating dealers. The premium audi dealership experience, on your terms. Audi at your door. Jack you may know honeywell from the old thermostat on the wall, but the company sold off that business. Now its becoming a soft ware firm. Joining me now is coup that lara, ceo of honeywell connected enterprises. Queue da lara, thanks so much for joining us. Can you explain what your division does . Well, the division that i lead is actually a brain child of our ceo, and its mission is really to do two things. One is to build a recurring Software Business that will be consequential to honeywell, and the second is to help the rest of the Company Become a Software Industrial meaning that every one of our core businesses we cant imagine releasing new products that do not have sensors or software in it. Jack can you explain, my colleagues are wondering when we can all go back in the office, when itll be safe, when we can do so and not put ourselves at health risks. Youve got tom procedures and some procedures that will make it safer. Can you explain that . Yes. Well, were no stranger to the industrial side. Youre worried about things falling on your head and falling off high areas, safety is something we know very well. So the techniques that weve seen in manufacturing and the Industrial Area can be applied to the office as well, and those are things like personal protective equipment, masks. Were equipping our sellers with safety i kits so that when they travel to see customers, theyre connected. Were looking at things like uv sterilization and air purification, vent thatlation, things were doing in hospitals today that have an application in the office. Were using analytics to people so that people have a sense of confidence because how do you know if the air qualitys good. And then were also applying software into our return to work application that will help facilitate the checkin process and securing consent from employees. Again, all of this is to help secure confidence for people coming back to work. Jack gotcha. Another thing i hope to do one of these days is get back on on airplane. You guys are working on some interesting stuff where maybe theres less chance of a pilot will have to say, oh, gosh, during the preflight check we found we have a maintenance issue, youre going to have to sit in the airport for another two hours. Can you explain how youre solving for that . Oh. We are using analytics to actually help us predict, and if we can do that, we can help the air laurens airlines take those parking lots occupant of commission and help stop the scenario youre talking about, which is delays and cancellations. Were also actually using analytics to optimize the flight planning so we can optimize takeoff and landings, help the airlines turn around the aircraft faster around the gate, all those things will help you to get from a to b more safely, faster and actually consume less fuel. Jack and i guess since you know that the plane will need a part at a certain time, you can actually route the part to the place where the plane will be when it needs it, which is a pretty neat oh, yes. I think theres a lot of supply chain improvement we can make as a consequence of having those insights. Jack so all of this means that you will be billing your compliants on a recurring revenue basically clients. And that seems to be the holy grail these days for investors. They love these companies that are b to b and have recurring revenue streams. Can you explain how honeywell is moving, i realize youre still selling stuff, but how youre also moving to that recurring revenue basis . Well, it starts with value to the customer. When we release a new product, particularly software or softwareenhanced solutions, its all about selling to the customer. They have to get a benefit from it. What we do is we tie the way we price and our billing to that value. Then after that what we have to focus on is delivering the value, and then the economics will take care of itself. Jack gotcha. I want to get some insight for investors more broadly about the technology industry. From where you sit, you have a lot of insights into what the Current Trends are, and i think its always interesting for investors to figure out what it is maybe the market hasnt seen yet that you see. Can you shower some ideas with us . Yes. Well, theres two ideas, jack, for you. One is we all know that we can code on a computer, but few realize that we can actually code physical things. Thats the power of the internet of things. And the reason for that is chips are gotting a lot cheaper. Getting a lot cheaper. Your toaster has a computer in it. So if things have chips in them, then we can connect them and program them. But the surprising thing is by programming them, we can also control them. So we have an application, for example, that can optimize the climate within a building, as an example, but also optimize your Energy Consumption at the same time by making automatic microadjustments. So we call this control by code. And its not just getting insight, its actually driving the control it. The second, the second idea that id offer up to you is crypto. Now, cryptois is interesting because it allows you to have ownership over your data, your identity. And bitcoin is the first manifestation of that. You have control over your money because you dont need a third party, topsdown entity to give you that ownership. So the plethora of services and products that will come from the ability to program like that, i think, is a very exciting space to watch. Jack that is interesting. I guess youre referring to a bank by a third party entity, but i will say that if i have to reboot my toaster over and over again, im going to give you a call and have you fix it for me. Thanks very much, que dallara. Thank you. Jack coming up, a surprisingly strong report on retail sales this week a market, pert join withs the panel, that d expert joins the panel. Thats next. Im a performer. Always have been. And always will be. Never letting anything get in my way. Not the doubts, distractions, or voice in my head. And certainly not arthritis. New voltaren provides powerful arthritis pain relief to help me keep moving. And it can help you too. Feel the joy of movement with voltaren. So as you head back out on the road, well be doing what we do best. Providing some calm in your day. With virtual, realtime tours of our vehicles as well as remote purchasing. For a little help, on and off the road. Now when you buy or lease a new lincoln, well make up to 3 payments on your behalf. Jack stocks have staged a recordbreaking rebound off their covid19 low even as the economy faces serious challenges dr. Ed, when you started out on wall street, the dow was trading around 1,000, bond yields were soaring. Now the dows around 26,000, and yields are at alltime lows. I want to hear where you think both of those markets go, but first, can you help us make sense of the news, this weeks blowout retail sales number . Right. Well, look, nub of us who were in our cabin were able to go out to do shopping, and many of those people who could work if home continued to get paychecks but all they could really spend was what they could buy in the Grocery Stores or have delivered to their front door. Those who, unfortunately, lost their jobs, many of them got some very Big Government benefits. But thaw, too, couldnt spend much money, so the savings rate soared in april, a huge fuel of cash built up in april, and we saw quite a bit being spent in may. I think well see more spent in june and july. Thatll help revi the economy. Jack lets look at the stock market. Obviously, we saw this massive surge, and so were wondering is this just a rational response, because were going to come out of this, and the market as it does is pricing in future earnings, or have investors lost their minds . [laughter] well, theres a little bit of everything going on here. Theres a little bit of questioning about whether this is irrational exuberance. But the reality is we dont really have a lockdown recession, we had a recovery coming out of that, is and it looks as though like that recession actually lasted only two months, march and april, and already may and june data are starting to show that were recovering. It could be a vshaped recovery for the next few months, and then maybe it will be the widely heralded nike swoosh, you know . Be down, be up, kind of swoosh for a while, and maybe we dont get back until maybe late 2022 to where we were in 2019. I be but i think the markets factoring in the recovery, factoring in a lot of companies actually were able to benefit from some of the adversities that we went through. Technology companies, for example. And i think the market is just looking forward. And on top of that, less liquidity piled up because weve had the fed providing lots of liquidity. The treasury cutting the taxes and providing checks, and so you put that all together, a trillion here, a there, and you get what really feel like a mountup since march 23rd. Ed, carlton english here. Just curious, is there anything thats worrying you that could prevent that nike swoosh recovery that you just mentioned . Well, im no virologist, im not an epidemiologist. I, obviously, like everybody else, im concerned that if were not careful, if we dont wear masks in public places, if we dont practice some social distancing, that we will get hot spots and recurrences here. And were not even talking about a second wave. Were still in the first wave of this thing. I i hope, i think theres some reason for hope that vaccines will be coming in the fall or early next year, and meanwhile we think theyll come across some treatments and cures that reduce the likelihood of dying from this, which is extreme hi important, obviously. Extremely important, obviously. Thats the biggest nightmare from this virus. So i think the risk is still on the health care, on the health side, the Health Care Issues relate to the virus. But short of that, i dont think were going to lock down the economy again. The bank sector took a hit today when there was some comments from a fed member that maybe the stress test will be a little tougher, that dividends might be under a little more scrutiny than before. Just wonder what you think. Well, the banks have responded is very quickly to this great virus crisis, locked down the recession. Theyve provisioned for loan losses to the tune of several billion dollars. So theyre, theyre anticipating that theyre going to have to take some charge offs. So far its actually been fairly tame, and i dont think were going to get the kind of chargeoffs that we had back in 2008 because the government has just intervened too rapidly here compared to what they did in 2008 with all sorts of lending programs, liquidity facilities. Im not sure the banks are going to be that stressed in terms of loan losses. But the government, i think, is going to put some pressure on them to be a little bit more circumspect about paying dividends during tough times like this. So i think some of them are going to relent and cut back their dividend payouts, and thats what the market discount today. Jack thank you so much, dr. Yardenu. Next time you come on, weve got to ask you about what movies to stream, but were out of time. [laughter] up next, we give our investment ideas for the coming week. Stay right there. Where will you go first . 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Weve always put safety first. And we always will. For people. For the future. And there has never been a summer when its mattered more. Wherever you go, summer safely. Get zero percent apr financing for up to five years on select models and exclusive lease offers. Jack jack, on friday amc theaters did a sudden act face and deciding that a maybe cramming a couple hundred people into a darkroom with no masks wasnt actually a great business plan. Look, the good news is theyre going to open the theaters, right . Next month. And im rooting for them. I like to go to the movies. They say masks will now be mandatory. I want to be safe, i want to keep others safe, so i will go to the movies, i wear my mask. Im just saying i also view the movies as a good reason to sit in the dark for two hours and cram popcorn and junior mints into my mouth as fast as i possibly can. And if weve got 3m watching or elon musk or americas engineers, theres got to be a way that we can put a safe and effective popcorn hatch or maybe candy dispenser in one of these. Weve tackled bigger problems than this before, america, lets figure out a way that i can overeat snacks safely. Jack Mike Bloomberg could figure out how to get you a soda. Carlton, youre looking look atl patch. Yeah, Marathon Petroleum has been on barrons radar for some time. We saw the reopening play, also news its looking to sell off its speedsway division, also talking about doing a pinoff. Either way, we could see that stock going to 50 at some point. Jack thats a refiner, not quite reliant on oil prices. Ben, what do you have for us . Biotech stocks, theyve been sort of stuck in place for the last six weeks after having a really nice rally off the low in march. They are looking like theyre setting up for another leg higher. I think they look great. Jack had a nice pop on friday. To read more, check out this weeks edition at barrons. Com. Dont forget to follow us on twitter, that is all for us. Wear that a mask, see you next wear that a mask, see you next week. Male announcer up next on leading the way. Dr. Michael youssef there is nothing that weakens the testimony of believers more than their inability to resolve their own disputes biblically. If we believers are going to reign and rule with christ, surely we can rule ourselves. When you take your brother or sister to court, you lose spiritually. I would rather give up some of my rights, even when im clearly in the right