Moments with the top newsmakers in this weeks mornings with maria in this weeks edition of the talkers. Adam schiff, the chairman of the intel committee, is out and about this weekend on sunday morning shows saying all of this news is just russian disinformation, and its not true. Let me be clear, the Intelligence Community doesnt believe that because theres no intelligence that supports that, and we have showered no intelligence with chairman shared no intelligence with chairman schiff that the laptop is part of some russian disinformation campaign. Maria does xi really want to get a deal she really want to get a deal done or not, mark . She says its about respecting the science, its really about her political agenda, maria, but i am optimistic. Maria what were hearing from director ratcliffe and director wray in terms of this foreign interference they say on the election. We shouldnt be surprised. Russia is our enemy. Iran is our enemy. We have tried to interfere in elections before. They will try to interfere in this election, they will likely to try to interfere in elections in the future. Maria are you poised to vote to remove section 230 . On the one hand, google is an extraordinary american company. And im very proud of that. On the other hand, googles no longer a company. Its a country. Maria state the case, tell us where the wrongdoing is in this case. A Bipartisan Group of attorneys general has been looking at this for some time, and on both sides of the aisle people understand that there are concerns when one company has so much economic power and control over markets. Maria and it was another busy week for stocks as we head into the election now. Joining me right now to talk about investing in this environment is cornerstone macros chief investment strategist, and michael is also, hes just been named one of the top three strategists on wall street by the Institutional Investor poll. That is a big deal, i know. Congratulations to you, michael. Thank you very much for being here. Thank you, maria. Thanks for having me. Maria so how are you positioning yourself amid all of this election uncertainty . Are you in the camp that you want to have two different portfolios should biden win, another different one should President Trump get a second term . Were, were sticking with strong fundamentals and sticking for, looking for stocks that have visibility. Theres an amazing amount of uncertainty today regarding the election, regarding the path of covid and a whole host of other global issues that investors have to deal with aside from just the election. And so when you have limited visibilitying, i think you often gravitate toward stocks that can provide greater visibility, so stocks with better fundamentals despite having higher valuations, its still areas that were recommending. So areas in the market like technology, consumer discretionary, the backdrop of really low interest rates, really low inflation, and were seeing jobs come back. And we think thats a pretty good backdrop for u. S. Consumers. Maria yes. So areas of stability amidst all the uncertainty. Maria i want to get your take on industries that are doing well during this pandemic, but i wonder if the valuations are out of whack. For example, zoom versus exxonmobil. This is one of these comparisons thats a head scratcher. When you look at the revenue of zoom, zoom generated 622 million in revenue for 2019 versus exxons 264 billion in revenue for 2019, and yet the market cap, zoom was higher than exxon. Youve got zoom with a fraction of the revenue, higher priced. Same thing if you look at amazon versus some other sectors. Thats pretty extraordinary. Can this last . Well, it can last for a while. As weve seen, the music can stay on for longer than with we expect. Weve seen the ipo market with some extraordinary valuations, you know, the snowflake ipo had also a really, really high price to sales valuation. And this is, again, its just another byproduct of a world of scarce growth. And so theres always going to be outliers like zoom, like snowflake and other names that have really, really elevated valuations. Those types of names today is where wed be paring back. We expect there to be some volatility at the tails of the investment landscape. So the really expensive Growth Stocks that really havent come into their mature part of their Business Cycle yet, and the really cheap, older economy value stocks which we think the economys just not going to be Strong Enough to really lift those more broadly. We want to be careful with both sets of those areas in the market, so weve been suggesting more of a garp approach, basically being more in the middle. Basic valuations, they dont have to be cutter cheap, but also dirt cheap, but also good fundamentals. You dont want to sacrifice quality for a cheap stock. Maria with so many people talking about a blue wave and the potential for joe bidens policies to get implemented as president , i want your take on whether or not we should worry about the Capital Gains tax proposals hes got. Because right now the tax is at 23. 8 . Joe biden says hes going to reverse Donald Trumps tax plan, and hes going to take Capital Gains all the way up to 43. 4 , take dividend taxes all the way to 43. 4 as well. Do you think thats going to have an impact on the stock market . I think it could create some near term volatility, but i think its going to be difficult to make a real bearish argument. We still are in a backdrop where there are few alternatives for investors to put their money. We have zero interest rates. Look back over time, the Capital Gains tax has moved around over the years looking back to 1930, there has been periods where the Capital Gains tax has gone up, and its not a real tight correlation with the valuations of the market. What id be more concerned about is how the whoever wins the next presidency, what their policys going to be around energy because theres a much greater correlation between commodity prices, oil, and inflation having an impact on the pe multiple. So, in other words, if oil prices were to go up a lot, perhaps, that, to me, would be a bigger concern, and theres plenty for episodes historically where thats been a problem whereas the Capital Gains tax rate has real encount implications for valuations across history. Maria yeah. And in that vein before we go, michael, real quick, would you be poised to buy a renewabling Company Stock under a biden presidency and under a Trump Presidency perhaps buy oil and even defense contractors given he wants to continue raising Defense Budgets . Yeah. I mean, those are the two more obvious implications. Maria yeah. I dont think necessarily a broad market inapplication for one president or another. There are a lot of interesting areas to invest. For biden, like you mentioned, renewable energy, cannabis. President trump, other sectors like defense and other areas. So i think thats where investors are going to really benefit from either a change or a continuation of the president is finding those specific areas. Its not a Broader Market call. Thats really about the global i economy, thats really about a lot of variables not just using the white house. Maria understood. Michael, its great to see you, thanks so much. Thanks. Byebye. Maria ill see you soon. Cornerstone macro. Stay with us, my oneonone stock slices. 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. Maria welcome back. The airlines in focus as the covid19 pandemic is still crippling the travel industry. Delta airlines showing a loss of 3. 30 a share in the third quarter, earnings last week were, as you see, another losing quarter. I spoke with the ceo of delta airlines, ed bastian, about the rough quarter and this period that hes never seen before, what he can expect the industry to rebound from this pandemic. Watch. We have never seen anything like this. You know, many of us, maria, thought, you know, our industry at least 9 11 would have been our existential event, defining event for history, and it was, it was a traumatic event. But this has significant implications that go far beyond anything that we experienced back almost 20 years ago now. The industry is slowly recovering. Were looking at our Fourth Quarter that were in currently, we expect to be back somewhere around 3035 of prior year levels in terms of total revenue. Still a long ways to go, but when we bottomed out at the pandemic, in the start in the Second Quarter, we were only at 10 . So weve tripled from the Second Quarter to the Fourth Quarter, but we have to triple again just to get back to anywhere close to the levels we were last year on a sustainable level. And thats hi why many of us are thinking this is going to take a couple more years to get this industry back to where it needs to be. Maria all this while youre also trying to save cash and make that cash burn better, as best as you can. You still have to pay out severance payments. Tell me about the cash burn that youre expecting in december, in the Fourth Quarter as you are trying to avoid employee furloughs by offering early retirement programs, voluntary separations and these cash severance payments. Our teams done an amazing job, maria, to manage cash, manage costs all on a voluntary basis. In the third quarter, we reduced our total operating cost by over 50 . Second quarter in a row weve done that. We expect to do a similar type of mark in the Fourth Quarter as well. Thats saving us an enormous amount of cash and capital. And as the revenue is coming back, climbing back up slowly but steadily, thats going to, hopefully, overtake the costs that we do have in the business. So by the time we get to the spring, we expect to be at that cash flow breakeven level. Were 18 million a day in the month of september. In december were at, were expecting to be at around 10 million a day. So good, really good improvement. Started at 100 million a day was our loss on a daily basis, we are thrilled the work our great people have enabled us to avoid any furloughs to date. We had almost half our entire staff out this summer, over 40,000 people. And thats saving jobs, its saving cash. Its really protecting our future. Maria that is just wonderful have you changed your expectations in terms of travel and when it may come back . I know we did see some, some good news in the last several weeks in terms of bookings and what the expectations are in terms of normalized travel. But have you been changing what yourement expecting sort of on an ongoing basis with new news of spikes, etc. Well, were in as uncertain a period that weve ever been in this industry, so expectations will change as we learn more about the virus and watch the medical advances to do what theyre doing to contain the virus. Were seeing bookings in overall traffic increase on an average of 12 a week. Weve seen that, you know, for the last number of months, that steady, steady climb. As an industry on sunday, tsa counts which is one of the measures that everyones looking at wees crossed the one million passenger carried mark as an industry in the, this past sunday. At delta we have a little over 20 of that level, so were carrying on a good day right now a little over 200,000 people. But continuing to improve and climb. So i think the Leisure Travel that we see today thats primarily the volume were carrying is going to be very responsive to the environment. Business travel is taking a while to come back. Were only at about 15 of our Business Revenues that wed normally expect. For delta, Business Revenues should represent close to half of our overall business, right now its significantly lower than that. And internationals another story. I think thats going to be a year out before you see International Flying at scale. Maria my thanks to ed bastian of delta airlines. Stay with us, immunity bio e see owe dr. Patrick soonshiong is with us. Hes got good news on a vaccine, thats coming up next Nonvalvular Afib can mean a lifetime of blood thinners. And if youre troubled by falls and bleeds, worry follows you everywhere. Over 100,000 people have left blood thinners behind with watchman. Its a onetime, minimally invasive procedure that reduces stroke risk and bleeding worryfor life. Watchman. Its one time. For a lifetime. Maria welcome back. The fda has tapped another company to join the race to develop a covid19 vaccine. After getting the go ahead to begin phase one Clinical Trial testing, immunity bio e in concert with thank west says nank west says its dosed its first patient. The companies are currently enrolling 35 healthy patients in the phase one study, and joining me right now is dr. Patrick soonshiong, the founder of companies of which immunity bio and nan k. West are members. Doctor, good to see you, thank you so much for being here. Thanks for having me, maria. Maria so tell me what you believe is a realistic timeline for this vaccine to be on the market. Tell me about entering this phase one trial and what is most important in terms of what youll be watching . Well, i think the difference what well be watching is tcells. A vaccine, unlike the current ones in phase two and three, are focused on generating not only just antibodies, but tcells. So well be watching for tcell generation from phase one and establishing the dose. So we anticipate completing the phase one by this month and immediately moving rapidly into phase two and three. Maria and so whats the timing on the rest of the trials, phase two and three . How long do you expect those to take . Would you expect a vaccine to get approval early next year, or is that too optimistic . Well, i think well be pushing as fast as we can, and i think well have to run a global trial e between the United States and the rest of the world. And itll probably be in the range of 30,000 patients randomized to la placebo e. And that takes its own time. But unfortunately or sadly, theres so much numbers of patients still getting infected around the world, so we anticipate that by the first and Second Quarter we should be well into those phase two, three trials of next year. Maria weve learned a lot about this disease over these last seven months of shutdown. Has that changed the way you approach it . What have you learned about it that you didnt know prior to these trials . Well, you know, we approached this very differently. We approach it based on my work on developing a vaccine for cancer. And developing a vaccine for cancer, you need to generate tcells. And now what weve learned from sarscov is, in fact, that antibodies, sadly, dont last very long. Whether that gives you longterm immunity, we dont know. But now there are much more papers coming out showing that tcells are the key to not only generating memory, so 17 years ago patients who received sarscov infections have stalled tcells in memory. A paper literally just came out yesterday that, unfortunately, spike protein does not create tcells. So our approach was to go after tcells and antibodies, and thats what were doing differently, and it looks like the science is coming through over the last six months, its proving to be thats the correct sort of judgment to generate a vaccine that covers both tcells and antibodies for longterm duration immunity. Maria wow. Really fascinating. What about cancer . Where are we in the fight against cancer, in your view, right now . Well, i think weve changed the paradime. Weve now understood paradigm. That weve now understood how we can activate cells, at the same time activate the t her cells, and when they talk to each other, the tcells and natural killer cells, we have the immune system. So as weve talked about before, happily weve now generated a complete remission in pancreatic cancer which is the first time in my career after 10, 15 years fighting this diseasement weve demonstrated complete remissions in triple breast cancer, head and neck cancer. So the fact that we can treat multiple tumors with the modern protocol, this is a a the awe approach weve taken with covid. Unlike the approach of just identifying antibodies, weve taken the approach of come to to prehenckive comprehensively enacting the entire human body. Maria the entire audience, myself included, were wishing you well. Dr. Soonshiong, thanks very much. Thanks for having me. Maria dont go anywhere, more wall street right after this. Your journey requires liberty mutual. They customize your Car Insurance so you only pay for what you need. Wow. That will save me lots of money. This games boring. Only pay for what you need. Liberty. Liberty. Liberty. Liberty. The rx crafted by lexus. Lease the 2020 rx350 for 409 a month for 36 months. Experience amazing at your lexus dealer. You have cancer. How their world stopped and when they found a way to face it. For some, this is where their keytruda story begins. Keytruda a breakthrough immunotherapy that may treat certain cancers. One of those cancers is advanced nonsquamous, nonsmall cell lung cancer where keytruda is approved to be used with certain chemotherapies as your first treatment if you do not have an abnormal egfr or alk gene. Keytruda helps your immune system fight cancer, but can also cause your immune system to attack healthy parts of your body. This can happen during or after treatment and may be severe and lead to death. See your doctor right away if you have new or worse cough, chest pain, shortness of breath, na eausr mir ng, arheeatb in eased easenghu oerthr ir change us nes orneyeoron w kn ws,knknint pa, conf ion or myor yorobmsob, init oinr g, ousflnghi thes noart e nol e thsspoleidleefctefs. S. Ite yr ouct aut abouti l your medaledonalals,ti m nsanplceem to treat 16 types of advancedncanr. Is approved to treat at keytruda. Com, and ask your doctor if keytruda can be part of your story. Maria welcome back. Thanks so much for joining us this weekend. Next weekend, same time, same place, weve got a big show. Tune in to fox business every friday night at 9 p. M. Eastern for another edition of wall street as we look ahead to the week ahead. This weekend with on fox news channel, sunday morning futures live at 10 a. M. Eastern, i speak with South Carolina senator lindsey graham, ohio congressman jim jordan, georgia congressman collins and Peter Schweizer my special guests, this weekend, sunday, 10 a. M. Live over on fox news. And right here on fox business, tune in every weekday and start smart from 69 a. M. Eastern for mornings with maria right here on fox business. Thanks so much for being with us, have a great rest of the weekend. Ill see you again next time. Gerry welcome to the wall street journal at large. It wasnt exactly a coaz is su chat between two old friends, but the final president ial debate on thursday was a stark contrast to the first rancorous showdown a few weeks ago. Perhaps it was the threat of the muted microphone, but we got a more measured, restrained and even respectful exchange. We also got just for a moment what this election and, unfortunately, so much of what our modern media and political
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