have one today, chipotle, the companies that fell a great deal and made a snap back like tulio where it makes it so you can take your small business and take it large, what do these things have in common? they are omni channel for companies that would otherwise fail i think it's -- this is ingenuity quarter. i know there will be people who say it's a v quarter, i know there will be people who say it's because the fed i think it's companies that recognize what was the matter and found ways to make money i found it a very inspiring quarter given the cynicism that we're surrounded with and the negativity which is frankly overwhelming for many people >> so you think that even though the fed has bought, what, $1.7 trillion in treasuries in four months and even as that pace flattens out we're going to continue to get innovation like that >> i find there is just innovation everywhere. i had honeywell on last night, they're solving the problem of the vials with plastic, there aren't enough vials to go around if it's just glass and if we have some sort of vaccine. they're solving with ultraviolet the problems of len leans in airplanes, maybe even movie theaters they're solving the problems of building air these are -- i see companies all the time -- now, i mean, some of the things that you see that are inventive you may laugh at, like the chicken sandwich from popeyes that has allowed them to have up 20% numbers, but i have seen the companies that we are talking about that did well, these companies pivoted, these companies understood what had to happen and it's joyous and i like them and i like the fact that they're businesses with ceos who adjust and who make money for their shareholders and are not just caught up with the incredible speculation which i think is i don't think wrong or the sense that all enter are going to be facing doom. i know there has not been a lot of m&a, david, i know there are a lot of people who believe this is 100% fed and secretary mnuchin. i think there's a lot of companies, david, that are just doing exciting things, recognizing the new environment and as satya nadella said, extending into later years. >> looking forward to that interview as well. when it comes to this theme that you are talking about in terms of innovation and potentially efficiency i do come back to what i continue to hear which is it is going to be a different world. sanjay moroda will be joining us as jim said. it will be a different world when we get to the other side of this there is going to be a significant percentage of your workforce that works remotely that you're going to let work remotely, you're not going to need the space that you once did. you're also using this period, by the way, 2020 overall where you're largely getting a pass from the financial markets to pursue other efficiencies, maybe that even includes quietly not rehiring people or if you are slowing people and it becoming a full-time layoff jim, i do wonder about that flip side innovation, yes, coupled with this changing world that we are all a part of right now, but i'm not sure how that's going to play in the real economy when it comes to jobs. >> well, i think that we are facing a reckoning carl, you know, these benefits have been so bountiful now of course obviously versus ceo compensation, no, but the extra $600, we don't know what's going to happen. every day there is a new part of the economy that i didn't know was doing poorly today the freelance economy in california there is a sense, carl, throughout this period that the stock market has decoupled from the real economy i'm not going to disagree with that, there are a lot of companies that frankly don't represent the united states, the real economy, the small and medium sized business, but there are a lot of companies out there that figured out how to make money and i think we don't salute them enough because, wow, we have some ceos who really recognize what david was talking about, the world has changed and they recognize how to profit from it. >> it's a got point not only on large companies but all the small businesses that we have on our air all the time who have managed to adapt today is the last day to apply for ppp, that's had, you know, relatively good success if you talk to some of the people who have joined us, but it does point to powell's testimony that we expect this afternoon, jim, and that is economic pain has not been evenly spread out and i wonder what you think he needs to say about further aid as we do approach some of these fiscal cliffs. >> i think that they have to look at the companies that can't come back. companies that literally are not able to get to where -- to when the vaccine kicks in i was looking at some of the new laws, the guidelines from the state of new jersey. what they favor, carl, over and over again is the big company before the little guy because the little guy really can't do the distancing because their places are much smaller, they can't add the plexiglas, they can't make it safer than it already is i think with restaurants, i mean, you can only do -- in paris they've made it so all the streets -- there is no parking and what they've done is all the restaurants, almost every one of them has outside we have just begun thinking like that so i think that he and secretary mnuchin have to recognize that there are some jobs, hotel, restaurant, that have to be distinguished and they have service that represents, say, 13, 15 million people and they are going to have to be -- let's call them coddled if you are a laissez-faire person, let's say offer continual help because they can't come back until there is a vaccine we may decide that they are not important. i look at these cruise lines every day and i say to myself are they that important? and i happen to like the companies very much but is that what we're supposed to support are these bonds being bought i think that there's going to be some industries that are going to have to be left by the wayside because they're not essential. but i genuinely believe that the hotel and restaurant cohort is going to go under unless they address them as a separate set of businesses that need help from the government. >> right jim, i mean, you mentioned of course a vaccine, but that's not an insignificant part of the economy that you're saying is reliant on there being a vaccine. not to mention what is a significant portion of the population you know, 15, 20% depends on how you measure it of the population that is still not going to feel really comfortable engaging in full economic activity until there is a vaccine we focus on it for obvious reasons. will it be later this year we can only hope more likely it's deeper into next year when we have a vaccine available. that's a huge economic toll, jim. >> yes. >> it's got to be. >> yes and it's not just business, obviously. i mean, carl, there is this -- i read the philadelphia enquirer every day and they have this -- the faces and names of people who have died and i go through them and a lot of them are in their 70s, in their 80s, in their 90s, in their 100s and i think that there is some sort of weird realism in this country that somehow those lives don't matter hey, listen, those people, it was their time that's ridiculous. and i think thatthat is anothe sign of the callousness of our government and the belief that somehow when you reach a certain age it's okay for you to die because of covid these people should be protected. but do you know what, the cynicism prohibits it. in the same way the cynicism prohibits wearing masks which is insanity thank heavens some of the airlines are saying something. but i find our country embarrassing at this point the eu won't let our people come back the eu we are the greatest country on earth. >> it does feel like that -- it feels like that tide is turning, jim. senator mcconnell yesterday saying there's no stigma in a mask sean hannity on fox last night saying i think they work goldman with a report out today talking about the benefit you could get from a nationwide mask mandate and then the ceo of united airlines on our air yesterday saying if you want to fly united you will wear one >> amen. >> take a listen. >> wasn't that great >> if you refuse to wear a mask, we're just not going to allow you to travel on united until the pandemic is over and it really is about protecting others and protecting their safety and we're serious about this and you've just got to do the right thing. >> i thought that was so great what courage i mean, they're going to fill those planes, i think dr. siegel, jeremy siegel was right in saying, look, if you guys are really doing it great and you have good numbers that says that people aren't getting sick and i had honeywell on last night and they're able to make the planes cleaner so it really is up to the individual people to wear masks. masks versus closing down the economy. i think it's rather remarkable the lack of -- the gdp brush versus wearing a mask. i know i personally am involved in a project to try to fund a mask, it's a mask that people will like, you will hear about it in a couple weeks, it's just something i care about why? because i cannot bear to see this thing -- i mean, look, i'm nobody, i'm a guy that has two shows, but, geez, we've got to unite. we've got to unite >> yeah. >> we can't have the gdp down 5% because live free or die, the mask i mean, give me a break. how about seat belts in cars, what a drag they were. i hated them >> yeah, we are the only country that has politicized the wearing of a mask and it's very much unfortunate and shows in the numbers. theres some hope, you know, as you might imagine hedge funds are employing a lot of scientists to take a look at things because it may give them an edge and apparently there may be some cities in texas depending on the data you are looking at that are starting to turn positively which is good. >> yes. >> turn in the right way i think florida continues to be a real question mark and concern out there. and there's this belief that when you do say, okay, we've got to get on this, you start to see about ten days later a response in terms of the numbers, new infections, hospitalizations a bit, but we're watching it all very closely and of course we all do see those comparisons with the eu, for example, 440 million people versus 330 million and our numbers are horrible at this point, guys so we can only hope that it's finally sort of going to wane as a political issue. >> right. >> which one might never have anticipated when this pandemic began. >> in the meantime the stocks that went up this quarter, a serious ad mixture of financial services, again, in this case it's the anti-wells fargos, it's fintech, tesla obviously on everybody's mind tesla is causing a great hunt among speculative people who are looking for a nick at that or they're looking for workhorse, workhorse group is not easy to get your arms around, they obviously have some things that are admirable in the ev space, but mccarter lee bray being the largest nasdaq that's not the united states, that's latin america it's an ebay of latin america or you could say amazon, ebay but when you look at what's winning you do get the irony that paypal and ebay were the same companies what an undervalued security that was people think that zoom is overvalued not if we stay at home not if we stay at home. >> that was really shrink to grow that was an actual shrink to grow, paypal from ebay. >> with amazing people on the paypal side, really just brilliant people ebay side, too ebay is coming back, by the way. >> guys, we have a lot to get to this morning. >> okay. >> there's the banks, wells fargo of course as jim mentioned, we will talk about the facebook ad boycott continuing to grow the china news as they signed that security law regarding hong kong into effect as jim said, micron on the show this hour, when "squawk on the street" returning. ♪ ♪ ♪ ♪ ♪ ♪ ♪ ♪ you're first. first to respond. first to put others' lives before your own. and in an emergency, you need a network that puts you first. that connects you to technology to each other and to other agencies. built with and for first responders. firstnet. the only officially authorized wireless network for first responders. because putting you first is our job. presumptive democratic presidential candidate joebd weighing in on taxes today telling potential donors if he were a lake effected he would get rid of trump's $2 trillion at that time cut a lot of you may not like that but i'm going to close loopholes. biden saying he would hike the corporate tax rate to 28 looking to raise an estimated $1.3 trillion over the next decade, something he told "squawk box" earlier in the month, i think, and something that david costa at goldman have talked about broadly in terms of market impact and earnings impact. >> look, you really slice a gigantic amount of the s&p profits and when you start talking about capital gains you know that there's -- at times capital gains have been taxed like ordinary income, at times they haven't capital gains are the province of the wealthy, there is not any dispute of that. if you're going to say that's not true you're obviously ill-advised. i think that what the market goes down, i've been saying that i mentioned that the market goes down because the s&p earnings go down, i think there's a lot of people who don't even recognize that there is a correlation, but, you know, david, we have a lot of new people coming into the market and i think they are baffled about the notion of things like the s&p profits and how it relates to priced earnings multiple. i got taught by lee cooperman at goldman. when i started i didn't recognize the relation and i was wrong and i got taught and then i taught others. david, what i see is that there are people who just don't even think that what biden says matters when we know that that would cut earnings you may favor, hey, i like him, it does cut earnings. >> it may well cut earnings. of course, we are still sitting here certainly we have debates when secretary mnuchin joined us -- well, previous to the pandemic or larry kudlow, about the impact of the 2017 tax cuts, jim, whether they really were a broad-based way to get the economy moving in a much stronger fashion or whether they were particular benefit to corporate america which then went out and spent a lot of the new found profits on buying back stock. so that debate will continue one thing that i think will not be in debate, though, whomever the administration s whether it's the current one or whether it is a biden administration, is going to be facing enormous budget deficits and the need to potentially raise more revenue if and when the economy does start to get going again and we are on the other side of this pandemic we are talking about of course record budget deficits now as a result of all the replacement aid, i don't really call it stimulus, that we have had to put into the market and that's expected to continue for some time i don't know, jim, how taxes are going to be viewed, but to your point and of course to the larger question of the disparity in incomes in this country that has been widening more or less let's call it for the last 20, 25 years, capital gains some say and taxing it as ordinary income would be at least one way to start getting at that. >> right i think you go back to president reagan, i thought he did a lot of good things and i think he would be aghast at the republicans and how much they've given away again, you guys have to read the history. he just didn't favor what's happening, but he did change the tax code to fix some loopholes carl, i think that it's not our generation that's going to have to face this problem, so i think that we can -- we're very cavalier, but there will be a generation that will have reckoning. i have dave cody on tonight, he is former ceo of honeywell and has been one of the principal preachers of let's worry about our grandkids and what's going to happen because it is pretty -- a little nutty >> yeah. no, i definitely want to hear from cote on that and we will get a cbo forecast later in the week which will talk to this topic. when we come back we will talk to micron up 50% from the march lows saay mnja rote tra will join jim later on in the hour when we come back. helps you redefine what's possible... now. from the hospital shifting to remote patient care in just 48 hours... to the university moving hundreds of apps quickly to the cloud... or the city government going digital to keep critical services running. you are creating the future-- on the fly. and we are helping you do it. vmware. realize what's possible. no matter what challenges life throws at you, we're always here to help with fast response and great service and it doesn't stop there we're also here to help look ahead that's why we're helping members catch up by spreading any missed usaa insurance payments over the next twelve months so you can keep more cash in your pockets for when it matters most and that's just one of the many ways we're here to help the military community find out more at usaa.com woi felt completely helpless.hed the milonline.ommunity my entire career and business were in jeopardy. i called reputation defender. vo: take control of your online reputation. get your free reputation report card at reputationdefender.com. find out your online reputation today and let the experts help you repair it. woman: they were able to restore my good name. vo: visit reputationdefender.com or call 1-877-866-8555. after do remember. futures slightly weak here, mixed, actually, if you look at the nasdaq as we close out q2. best quarter for the nasdaq since q4 of 2001 and best quarter for dow s&p since q4 of '98. back in a moment now is the time to support the places you love. spend 10 dollars or more at a participating small business and get 5 dollars back, up to 10 times with american express. enroll now at shopsmall.com. >> announcer: the opening bell is brought to you by nuveen. a leader in income, alternatives and responsible investing. let's get a mad dash with jim, watching a little cmg. >> yeah, when you think about why chipotle or spotify have such unbelievable gains during this quarter, i think about innovation so this morning chipotle announces a virtual farmers market powered by shopify. those of us who have been cooking because our spouses are somewhere else, where it's safer, get this, farmers around the country have had to destroy millions of pounds of fresh goods due to decreased demand with restaurants, hotels and schools closed chipotle's farmers market aim to give suppliers a new stream of revenue. sure enough -- carl, this is what i'm going to order from, the kind of original thinking about great food that is being destroyed by a company that cares about its farmers and by a company shopify that powers so much of this new economy that is shocking, it's shocking people how shopify probably one of the most even appear valuable companies that you can find in the new economy. i point this out as literally the kind of change that we're getting in order to adjust to the new world and i salute both companies for trying to make it so that the farmers do not have to destroy food for a country that -- where so many people need it. >> yeah, no, that is -- that's hard stuff to watch. of course it comes a day, jim, after we talked about their grubhub partnership as they continue to unlock the puzzle of delivery. >> and there's grubhub out with a european bid now we are starting to talk about uber buying post mates for maybe almost $3 million. i wish david knew something about this it would be the biggest deal we have david, are you back? >> i am, i'm back. >> a couple different headlines on post mates. >> yeah, you know, listen, with he see that times, ipo route or sale route that is not -- that's something that frequently companies that are thinking about the public markets in some way are going to sort of weigh, which is the best route? so not that surprising we also of course know that uber does see the need to consolidate. we went over and over and over what was going on between uber and grubhub and of course the antitrust implications of that deal which ultimately was one of the main reasons why it did not make it and then grub of course selling to european competitor which is not going to necessarily lead to consolidation in the market, but this would so do you eventually get down to three competitors, jim, i guess is the key request he. >> yes. >> one of them being uber with uber eats and whomever it may be, in this case post mates, then a door dash, then the grub deal as well with take away. >> look, i think that's what has to happen, there's so many of these, they've gotten very cut throat, you can get good deals now if you are a restaurant. i would say that bastion lima the post mates fellow last night the story was he filed a confidential ipo, this morning you come in uber wants to buy. i happen to like post mates very much we need competition among -- even if it's three companies that's absolutely fine because what happens is that some of these companies don't have coverage so if you have three strong companies that you can spread around and be able to work with, right now at one of my restaurants we have our -- which is the payroll protection paycheck, we're using our staff with bicycles to do it ourselves just because it's too expensive to use these services, but they are integral to the larger companies, ship olt lay yesterday talking about grub, they did not talk about uber they had signed a deal with uber in the spring. yes, and i'm watching this post mates because this is a company that is -- if it was really going to be worth $2.7 billion i'm quite surprised, but if that's the case then mirror should have gone public at a billion, the company that was bought by lulu you guys ever use mirror carl, do you use mirror? >> we have had the mirror founder on "squawk alley" i think last fall. $500 million as you said not huge, but some pretty positive commentary about how lulu is thinking beyond physical repair certainly, even beyond e-commerce, it's about content. >> i was very, very impressed because that was something i thought nike should buy because they talked endlessly about membership and they got scooped. we have to think about what nike is up to, they are not thinking big enough >> there's the opening bell, guys, dow is down about 100. speaking of lulu, jim, mcdonald was on our air last night -- well, talking about mirror but also talking about the growing list of companies that have joined the boycott of facebook advertising in the last 24 hours, ford, microsoft, conagra, best buy, aadidas, puma, reebok. here is what he said. >> we believe that we all own a responsibility in creating an inclusive society and we have an opportunity to use our brand and our voice to drive meaningful change we're in conversations with facebook, we had a great partnership, we're standing and supporting the campaign and we will look for change on their part to sort of determine moving forward. >> all right looking for change, jim. >> everybody is. i talked to a number of the consumer package good companies and it's always the same they are in constructive dialogue they're talking to the show. give me a break. make the change, facebook. we don't understand. now, one of the technology-oriented cpgs that i talked to basically says, look, it costs a lot of money, but we look at -- to do that but i also say, listen, we have an fcc in our country and if you are a newspaper, if you are what we do you couldn't do what facebook is doing and i think that the idea that they should be any different is starting to really rangel people because these big companies just can't be next to hate because it hurts their sales. david, you know that facebook has been trying to get away with this for a listening time and this seems to be one of those moments where big corporate america is not going totake it anymore. >> it doesn't appear to be -- i think it's an important -- maybe even a seminole moment, jim. at the same time investors don't seem to be particularly concerned. >> 8 million investors. >> not doing anything today. even the big guys don't really matter there it is now. >> they've never done well with consumer packaged goods. this he haven't made the inroads. facebook in many ways is flawed when it comes to consumer packaged goods but i don't think they have tried to move them as much as they have all the money that comes in over the transom we are at a moment where i think mark zuckerberg has to say, do you know what, i really misjudged this country corporate america is changing rather rapidly i don't even care if small and midsize stay with us we're going to make this -- and then figure out a price. using artificial intelligence to be able to spot certain things that we all know are bad and then get individual humans to look at it i don't know, maybe it costs a couple billion but, do you know what, take the hit. >> right. >> take the hit. but he is a young fella and he likes to do what he does. >> he is he does. he trusts his instincts. he trusts his instincts because they have served him well thus far. >> right. >> listen, it is a key question. it's not just hate speech as well, it is also things that are simply untrue, but how far does facebook go and as we know they can face pressure from both sides of the political spectrum, but certainly, you know, from the president, for example it puts them in a difficult position but it's very interesting and important, i think, to note that corporate america seems to be more and more speaking with one voice on that matter, jim whether or not it has any impact on facebook's business, i don't know, given the points you are making. >> you have a board and you do outside counsel, you get the best, you get some constitutional lawyers and this is like when potter stewart said, listen, pornography, i know it when i see it. and you arrive at a consensus that does epitomize the best this is not hard if i were on facebook's board i would solve this in 48 hours i'm not. why would i know it? because i see it just like potter stewart it really is -- it wrangles many of us to realize that mark runs the company the way that -- it's his own. and i think that the board has to address this, but they are largely silent do you know what, they don't give a damn. they are making a lot of money you can say they may think that they give a damn, but you hire some people who may hurt your profits. it's what people do. hey, by the way, it's what fox news did i mean, they hired paul wise and everybody got fired, you know. when you really hire an honest broker, things -- the chips fall. >> yeah, but this is an ongoing cost as opposed to that one-time cost you're referring to facebook would have to employ an enormous amount of people and or technology -- >> right. >> -- that it would develop to be able to identify what you are talking about and that would be an ongoing effort that would ultimately hurt their margins which as we know are incredible. >> you know, look, the time has come their history is turning against them they can do whatever they want, there is a path for them and you could argue that all the cpg companies are wrong. how about this, who cares if they're wrong, just care what's right. look at justice roberts, okay, there are people in the "new york times" who are saying, listen, that abortion decision he doesn't really believe that it's other issues. there are people who could say justice roberts is one way, justice roberts is another i mentioned it only because there are people who are like justice roberts who you can hire and you can say, listen, guys, help us. we don't know what's right go talk to -- please go talk to clorox, please go talk to starbucks, go talk to these companies that are say no to us and let's find out what they really want. it's not left or right, but i just feel like facebook is going to be -- one day we're going to come in and facebook's numbers are going to be down because of this not now. jpmorgan has put up a good defense for the numbers not being down. >> maybe it's consumers that will need to actually speak with their feet, jim, and, you know, the instagram, facebook, what's app flat forms start to actually see that that may be a different story. that's not the case right now. people use their services every day. >> i think it's great, i think they did -- they did the shops, i think that was great, i think they should help -- they should set up a fund to be able to help minority businesses, that's something they should have done about a year ago they should care about this ongoing discussion they should actually sit down with mark beniot who has called them a cancer. the arc of justice it takes a long time, dr. king was right, but it does happen and you want to be on the right side. they can be on the wrong side for now but obviously things are changing rather rapidly and i think when you have most ceos on they recognize that the time has changed and zuckerberg doesn't seem to get that done some things right, but this is not left -- again, it's not left or right, it's just what's happening in the country i mean, look at minneapolis for god's sake jesus. >> guys, i want to get to a couple of quick things you know, we've talked a lot about the lack of merger and acquisition activity post mates and uber seems to be one of the only companies that seems set on really trying to pursue a transaction but we are keeping a close eye on deals that were assigned prior to the pandemic, one of the key ones is tiffany lvmh had its annual meeting today and there were a number of questions to mr. arano, the founder, the man who runs it, about that tiffany deal. they didn't have much to say here is the quote, we believe tiffany is one of the most iconic in that respect referring to something else he said has its place in the lvmh portfolio and have nothing to add. there have been people who have been focused on the lack of an antitrust filing as yet with the eu as a sign perhaps that lvmh continues to slow walk this deal looking fournette another opportunity it might have to try to get a price cut as i indicated earlier was mr. arno's desire i'm hearing that the lack of a filing on the eu is not the result of slow walking but is simply a strategy on the lvmh side to say we are not ready to go to the eu because they need to absorb a lot of stuff we will be throwing at them. there is a 25-day block, we don't want to get into phase two which starts a 90-day process. they say we understand how the eu works better than you do, tiffany. this is not a sign that we are trying to slow walk this deal. that said, i still believe that at least mr. arno if he saw an opportunity would try to take one but it's unclear he's going to see any opportunity here in terms of being able to try to get that price cut that he has been after as we know for some time you can see tiffany's shares continue to trade roughly $15 below the all cash deal price of 135. jim, send it back over to you. >> i'm following that one and i'm following simon properties, too, taubman cut the dividend last night by simon but they are still very interesting i think at a certain price, maybe down substantially. shares of micron jumping on the company's better an expected quarrel results, but most importantly because the analysts got it wrong joining us now in a cnbc exclusive is micron exclusive sanjay mehrotra. sanjay, you did it again, you surprised them at what point do the analysts realize it's about secular trends you are riding including 5g and most importantly the data center. >> you're right, jim our fiscal third quarter we delivered strong results ahead of the expectations that we had guided to in march in march, of course, we were impacted by certain supply related to covid, however, our operations team performed extremely well and on the demand side we saw driving strength in the data center demands, the work loads related to work from home absolutely as we saw compared to pre covid expectations a strong demand growth on the data center side, we also saw demand growth in enterprise spaces and e learning environment. all of this helped us deliver healthy results. as we look ahead we see healthy demand on the data center side jim, hyper scalers have talked about capx investment, you know, being strong this year and that bodes well for the data center demand in addition the stimulus and the economies around the globe, that bodes well for digitization of the economy, all those trends that were two to four-year trends are being accelerate nood a few months now so these trends bode well. so while compared to the first half, the demand in cloud in data center, yet the demand is healthy. and in addition of course as the economies around the globe improve, some of the smartphone demands, some of the consumer demands will come back and micron is a very well diversified company across multiple end markets and we have delivered strong execution with our technology and products and that bodes well for long term health of the company. >> sanjay, why does fiscal year 20 front end capital expenditures why is it down 20% from fiscal '19 given all of the opportunities. >> we want to make sure, jim that is correct we manage our supply bed growth in line with the demand expectations. we don't want to oversupply the market we are exercising strong discipline in terms of our capx investments, we want to make sure capx investments have strong return on the invested capital and we are executing well with our technology transitions. we are being disciplined yet managing the supply growth well to align with the demand expectations from our customers. you are seeing overall healthy results. this is an important aspect of micron, being disciplined, focused on profitable growth and of course product leadership to continue to address our diverse end market opportunities if we remain disciplined with respect to capx investments then the future is well. >> people have to understand at home this is a new micron. so many quarters of positive cash flow and the analysts don't seem to recognize it i do want to talk about something that you mentioned that is a tough subject and you know it better than anyone recent restrictions on huawei are impacting our opportunity in the near term, again, we have hong kong, i know hong kong doesn't trade that much, just a couple percent but what is the china cold war doing to micron? >> so certainly u.s./china trade relations create some uncertainty, you know, in the overall business, however, we are a very important partner, supplier to drive the innovation agenda of our customers in china as well. micron continues to be a strong supplier to the companies in china. of course, while abiding by all the rules and regulations of the u.s. administration. important thing also, jim, is that our business is well-diversified, we have exports all around the globe while china is an important market for us, we of course are diversified out of china as well. >> sanjay, this analysis of 5g is about as beautiful as i've seen in your conference call the strongest memory and storage content growth 5g requires just a huge amount of micron product, doesn't it? >> absolutely right. 5g will be a long-term growth driver in our industry and certainly requires more memory and storage. you know, we she lighted in the conference call, jim, 5g is now moving even to the low end and the midrange phones. when you compare how much memory it needs, it requires 6 gigabyte minimum that we have seen on 5g phones at the low end and midrange phones compared to 2 to 4 gigabyte of ram in the 4g phones high end phones have even 8 to 16 gigabyte of data built into it so 5g is a strong driver in smart phones for content as well as for land content and of course 5g is not only about smart phones 5g is about iot, it's about intelligent devices at the edge, it's about automation in the factories. all of these trends in multiple end markets will be a strong driver of growth and i like to say that 5g helps drives is cycle of intelligence devices at the edge, driving greater need more more intelligent data analytics in the cloud that bodes well because all of that requires and creates more data, data lives in micron's products, right? so this is a long-term trend, 5g as a growth driver for memory and storage. and micron is well-positioned with several leading products for business and market applications to address the growth that 5g will desire. >> i was thinking about it when i was reading this versus '93, '94 during the great debacle at micr micron right now you have $9.3 billion in cash versus debt of 6.7 at this point in the cycle i'm used to seeing micron have 9.3 in debt and 6.7 in cash. you and your cfo, you have been remarkable, let's say, stewards of your cash position. how is that possible given the analysts always telling me that this is the most cyclical of all technology companies >> like i said earlier, jim, this is a new micron it is about product leadership, being high value solutions in lan, for example, now we have more than 75% of our bets going into high value solutions which give you higher margin we are extremely disciplined on return on investment on our enlisted capital so the company is being disciplined, driving product leadership, executing well, supply chain execution extremely well all of this is resulting in solid financial strength for the company and you are absolutely right, i mean, our net cash position is solid, 14th consecutive quarters of free cash flow in the company even through the cyclical downturn in the industry micron stayed healthy in terms of financial results. and this is very different from the micron of the past and this is what is the focus of the company, to drive greater intimacy with customers, bring greater value to them and in the process build greater value for micron as well. >> it's different. it's different congratulations. sanjay mehrotra, micron technology ceo and president always great great to see you, sir. >> great to see you, too, jim. thank you. >> carl, back to you. >> micron happening helping to lead the s&p 500 right now we're getting chicago pmi. let's get to rick. >> june pmi for chicago expected to be in the mid 40s, came out at 36.6. this sequentially follows an unrevised 32.3 that was a 38-year low. this 36.6 the best number since march, we were at 47.8 maybe some big news, even though treasury yields are somewhat unchanged let's go to the board. yesterday's closes in threes, fives, seven, 16 plus base point all time yield close for a three year, 27 basis times all time low for a five years and 36 plus all time low for a seven year. they're still guns hot this he could extend that more basis points lower the point is we finish off this midyear final quarter second quarter what we are seeing is a real rush for safety with regard to treasuries and sovereigns mostly across the globe. even corporate securities on the investment grade as you look at the etfs have been outperforming their high yield counterparts. with he want to pay close attention as the nervousness of late is putting extra demand on high quality collateral. carl, jim, david, back to you. >> rick, thank you. as rick has been speaking we've been getting breaking news out of the eu, reopening borders to 14 countries, but not the u.s. seema mody has got that. >> the european union beginning to reopen its borders to 14 countries outside of europe, what it is calling its safe list the u.s. is noticeably absent. that means americans are barred from entering europe starting july 1st, which is tomorrow. some of the countries that made the cut include australia, japan, south korea this list will be updated every two weeks and will evaluate a number of different criteria including the epidemiological situation, the case count in regards to covid-19. so there certainly seems to be an evolving situation as the eu looks to reopen its borders and lift restrictions that have hurt a lot of economies in europe that are so dependent on tourism, for example, croatia which makes up 28% of its gds from tourism, spain, italy and greece 10% or more and summer is when you see these countries see the bulk of that tourism revenue made >> thank you for that. seema, for that jim, your thoughts certainly knowing italy well, they are lifting the restrictions from china if it's reciprocated >> it does have that kind of developing world feel versus a developed nation i haven't been -- you know my place in italy, can't get there. daughter coming in from spain. can she come back? i don't know a lot of -- i think my situation obviously is a microcosm of a whole group of people who would be traveling otherwise another reason where i think the airlines are problematic because they make a fortune on these routes so it is very much a business story and very much being ignored, and that's a shame, because obviously travel is a very important part of the world and our business and clear because of the mask. watching my twitter feed people hate the mask it's like hey, again, with facebook, guys, things have changed, and you know, my generation is much too old to change, maybe change their ways but things have changed and we have to get back in the game united states got to get back in the game >> those economies as seema pointed out, of course, some of them very much dependent on tourism, and u.s. travel is an important component of that. we haven't talked about italy's national debt in quite some time but it is one of the largest bond issuers that's out there. at some point that may come back to the fore in terms of focusing on the service, of course it's part of the eu, but you can't blame them, jim, 5% of the world's population, 25% of the world's cases, thankfully our death rate appears to be declining. >> no, you can't blame them at all. when you look at new jersey, we're supposed to have open restaurants and there were picture this is weekend down the shores from philadelphia of just clamoring at bars, better times than ever, and you know, again, i keep coming back to this, until you get a vaccine, the world has changed, and post-minneapolis, the world has changed, and one obviously you get a vaccine, going to take a little while anyone who is not adjusting listen to the ceos who" they'ret minneapolis. they ought to get more understanding about how the country's changing >> yes also new jersey right now guys doubling the number of states with the quarantine restrictions to 16 we'll take a quick break here. we did take a small leg lower on that disappointing chicago pmi and boeing's dragging about 60 points off the dow we're back in a minute what is it business leader need to understand >> increasing connectivity between producers and consumers issalry win/win for everybody. >> this pandemic has shown us we need every player to work together so we can meet the needs of this growing world. >> with daily insights on the new now, this is "business interrupted" ey. mornings were made for better things than rheumatoid arthritis. when considering another treatment, ask about xeljanz a pill for adults with moderate to severe rheumatoid arthritis when methotrexate has not helped enough. xeljanz can reduce pain, swelling, and further joint damage, even without methotrexate. xeljanz can lower your ability to fight infections. before and during treatment, your doctor should check for infections like tb and do blood tests. tell your doctor if you've had hepatitis b or c, have flu-like symptoms, or are prone to infections. 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$50 prepaid card when you switch. 5g is now included with all new data options. switch and save hundreds. xfinity mobile. it's time for jim and "stop trading. >> a great stock to atch, lam research up 12 points. it's a capital equipment company up because january say and meroche said we'd try to have discipline how much equipment we buy to make more chips people aren't believing him saying there's so much demand we have to go to lam and get more equipment to make more chips i think you make money either way with lam because it's well-run, a great company. >> we did get this digitimes piece that suppliers expect iphone 5g shipments less half of prior estimates. do we buy that today or the requisite caveats? >> probably stupid there isn't any sign from any people, who do they talk to, ten companies in the 5g industry, talk to them every week and business is great. they're so thrilled. i don't know where do people get stuff? they should make more calls. they should have less of a life and make more calls. >> we're always a little leery of some of the supply chain stories especially regarding apple. jim, cote tonight. >> dave cote, a fabulous book takes a shot at ceos jay brown, crown castle is an amazing story, people underestimate the tower. sean connolly explodes the numbers with conagra a lot of the stay-at-home stores people don't believe in it anymore. ceos who come on my show, left wing, right wing, carl, they've changed their view and hate them or like them, they've changed their view facebook has not >> jim, we're going to wait to see if that changes as well, if we get any incremental moves in policy out of facebook we'll see you tonight. >> thank you >> "mad money" is at 6:00 p.m. eastern time in the meantime, everybody, good tuesday morning welcome to "squawk on the street." i'm carl quintanilla with david faber and morgan brennan pretty interesting final day of q2 coming off and closing out the best quarter in a couple of decad decades. we have powell on the hill at 12:30, the eu officially excluding the united states as they lift some non-essential travel, and now we're getting some consumer confidence numbers. back to rick >> yes, our june read on consumer confidence from the conference board is better than the 91.5 expected. 98.1 that say nice jump from 86.6, and it is the best number since the march read, which was 118.8. if we go through the internals present situation, jump from 71.1 to 86.2, and expectations, what may lie ahead really zoomed from 96.9 to 106.0 so as we close out the half year, the second quarter, i will leave you with one final thought. we're doing it with many treasury rates at all-time low yields or very near outside of the longest maturities, 30-year bonds. carl, back to you. >> that's going to be one of the challenges here, rick, thank you. on that very note we bring in jim lowell, chief investment sfen advi officer and oksana aronov, thanks to both of you. good to see you. >> good to see you >> thanks. >> oksana, jpmorgan's aggregate view of the markets, it seems in the last couple of days, they've taken a look at what's happened with the pandemic and some of the rising daily caseload data, and it sounds like you're trying to hedge a strategy that had been counting on pretty steady recovery >> so jpmorgan obviously is comprised of a lot of different engines that invest on behalf of our client, at least on the asset management side and we specifically focus on an absolute return ended approach which means let answer look at the possible scenarios and construct a portfolio that is going to be resilient across those scenarios. when you think about resilience today, you can't help but wonder at what point does this collective hallucination in the marketplace between central bankers and investors and looks at reality of what's on the ground, which is of course, decimated employment numbers, really unclear picture in terms of when does demand come back, even though we've unleashed supply and yes, some of the demand has bounced back from ultra, ultra low levels but certainly nowhere near where we were last year at this time. so if there was ever a year that could serve as a posterchild for lack of regard for fundamentals, 2020 is probably it, because we went from what could possibly go wrong to nothing could possibly go right, and back to what could possibly go wrong in the blink of an eye. and i think at this point, it's really, really important to discern what is real, what is driven by fundamentals, and what is driven by central bank sugar, which you know, liquidity they're providing is not equivalent to solvency and the conversation will increasingly turn to examination of that. >> so you think the market has a moment of clarity regarding that very issue, if sometime in the second half? >> i think so. i think if we have seen something resembling a "v" it is most likely part of a "w" to use the much beloved letter analogy, and also you know, it's really there's a big difference between kind of what we're observing in the equity market, right, which can go far on additive and sentiment and that's all great and what we're observing in the sector market where you need to be able to put on the table that interest payment every quarter and that's very different than sentiment and attitude, and what we see in the credit markets today is, frankly, an overreaction to the upside, simply because the estimated default over the next 12 months in the industry ranges from 8% to 13% if we take 10% as a midpoint estimate that applies high-yield spreads of roughly 925 basis points currently high yield spreads are around 600 and the city drumbeat of downgrades continues, and so we are in the market in credit that simply does not reflect the reality of downgrades and defaults that we'll see through the end of this year and into q1 and the first half of 2021 >> interesting jim, the bulls might counter that we're not looking enough at potential medical breakthroughs, something that's been a little quiet in the last couple of weeks, and maybe even the evolution of shutdowns we're not australia, at least not right now where it's a broad lockdown we're managing to find ways to shut down a bar here or there and some argue that's market positive >> well, look, whether this is a second wave or still the big first wave, clearly manifesting ways to deal with it better than we did back in march when everybody got wiped out by the tsunami of fear. fear and hope are not investment disciplines. we also understand the medical data is absolutely critical to being able to sustain any kind of upper trajectory in thisfed fueled market. we certainly agreed that the fed has created a kind of sugar high in the market. we think that wears away over the next couple of months. we continue to be very focused on all three legs of the asset class, stocks, bonds and cash, even though cash is yielding zero, it is one of those moments in the market times where we think the turn of our money is equally as important as long-term aspirations for return on it. all that said, you're absolutely right. the health care sector is overweight across the board in our portfolios, and likely to remain so. we think that's where innovation meets necessary demand >> oksana, the word hallucination really jumped out at me. i totally get your point about the magic or maybe lack of logic that's playing out in the market but on the flipside the past quarter, the fact it has been as we've seen in years past, don't fight the fed and if you are sitting on the sidelines in cash and not participating in this market, then you did miss out on some heady returns for the quarter. if we are going to see this sentiment shift back towards something like fundamentals, which of course makes sense, then where do investors need to be positioned for the third quarter and beyond >> so i think certainly this is not that point in time to harvest liquidity, particularly if you had a great experience so far, and in terms of positioning, looking forward, i think security selection has never been more important, if we really are going to go into an environment that starts to heed fundamentals more. what do we see in the market today, like how do we know again this is an overreaction even on the equity side. we have companies that were aided by the pandemic, for example, in the tech sector, that seemed to have no price that was too high and we have companies in the sectors badly hurt by the pandemic like travel, leisure, gaming, that have enjoyed spectacular recoveries, all while barely showing any signs of life w no currently discernible catalyst for a turn-around until we have some break-through on the health care side which is proving to be frankly difficult. there's a lot of hopeful news but nothing concrete yet so i think certainly security selection will be really, really important, more important than ever, and i never really understood the reason for why anyone certainly in the sector on the sector side of, sorry, on the credit side of the market would want to let an etf drag them through the market, especially when those are so completely susceptible to inflows and outflows and by the way, yesterday we saw a record amount of outflows from credit etfs, particularly on the high yield side so perhaps we're seeing a realization of, now he, what is under the hood what is happening with the credit quality, with the balance sheets, with the cash prospects, et cetera. so i think generally, being more cautious here and going with someone who is really focused on the quality of the balance sheets is really important >> yes, jim, do you see it the same way near term, at least through the second half of the year, you know, how do you think investors need to be positioned in this market and i guess also if we do see more pullbacks f we see some sort of correction, if we get some "w" recovery for example, then for longer term opportunities, what would you like >> so we think it's not just just a question of v or w or vws. we'll have a lot of vws as we get through the summer months. while it sounds right, the need to focus on fundamentals is keys, the more recent data the better it is still data highly suspect and dependent on the trajectory of the medical data positive or negative we think it's important to stay disciplined, diversified across asset classes, stocks, bonds, cash matter, trying to chase on the fear of missing out. tech highs we think would be a fundamental mistake. we also think it would be a mistake to chase deeply discounted lows on the value side they're cheap for a reason, likely to remain so for quite some time and ultimately if we do get a sustained turnaround in reopenings, we are know we're facing come september, october, november, another start to a flu season and between now and then, you know, this virus could mutate so we are going to remain near term defensive, even as we rely upon our active managers to be highly selective if the opportunity especially on price presents itself for long-term gains. >> and if i may add one more thing, just from an asset allocation standpoint, i think every fixed income, you know, traditional and long only fixed income investor has to ask the question what is that port of my portfolio going to do for my portfol portfolio, being able to reduce the volatility in my portfolio when the yields are this low and longer term prospects are, at best, unexciting, at worst, yields start to drift up eventually because of course, we are considering the possibility of an inflation somewhere down the line, maybe in a couple years, three, four, five years what is that going to do for my portfolio, and i think that is a really important question to consider >> one last point. oksana, earlier in the week jpm said we expect a fuller recovery in the euro area than the u.s., pandemic policy response is one important difference do you share that view >> >> i think europe generally is going to be actually in much more dire straits. they have so far talk about complete disconnect between fundamentals and, you know, the amount of liquidity that central bank has pumped into the system, it's completely destroyed any real price discovery process. so i think if anything like a price discovery process was to take hold there, i think the market's going to be a really painful place to be in europe. so we've generally stayed away from that part of the world. you know, talk about fixed income, there's really no opportunity to generate any money in fixed income in europe. equities potentially have more of an upside because they haven't really participated, haven't been up as much as we've been here in the u.s., so that maybe is worth looking at but generally we think there's a lack of true price discovery in that region, even less so than here in the u.s. >> hmm oksana, thank you, really great stuff, and jim lowell, thank you, guys. >> thank you after the break, cirque du soleil filing for bankruptcy and cutting 3,500 jobs the ceo joins us on the other side of this break on the last day of the trading month, last day of the first quarter, last day of the first half. the dow is slightly lower thanks to boeing but the s&p and nasdaq both higher. stay with us i got an oriole here. eh. common bird. 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 that's... 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. you cirque du soleil cutting 3,500 jobs and filing for bankruptcy protection as its shows remain shut down during the pandemic are expected to remain dark until at least the combination of 2021. cirque du soleil's ceo dan yar lamarre joins us now it's good to have you, i know, on a very difficult day, series of days, given zero revenues for three or four months tell me what happens now >> yes, so what is happening is now that we are protected from our creditors, we also have received an offer from our actual shareholders with the support of the quebec government that has loaned $200 million, so a total of $300 million is going to be reinvested in the proposal that we have in the company, in order to be able to go through the crisis and be ready to have a revival of the company, when normally will come back. >> right, and you mentioned of course those financial sponsors that own the company now in a position to continue to own it, and putting up more additional financing. there is the possibility somebody else could come in as well here during this bankruptcy process. do you expect that to be a real possibility or is your expectation that the plan as laid out is going to be followed >> yes, the plan that is laid out is guaranteeing the future of the company, which is good news for all our employees, because they hope that we will recall them and this is our objective. having said that, there is 45 da is days ahead of us and others have shown interest to come up with an offer, so obviously they would have to come with an offer that is better for the future of the company, better for our employees, and after this 45 days, our actual shareholder would have the option to match an offer, if the offer is better than the one that is on the table right now. that's why today i can guarantee the future of cirque du soleil is ensured and when normalcy is back, then all of our shows progressively will come back >> right and of course, i guess the key is the 3,480 employees being terminated will come back or most of them will. what do you see once you reemerge from this organization and are able once again to actually fill theaters and arenas to see your shows is everybody going to be able to come back? >> that is the objective we will maneuver very carefully because nobody knows when nor l normalcy will come that's why we have put together a business plan that is quite conservative, meaning that we don't expect coming back which shows until the beginning of 2021, and we will move progressively starting with las vegas, which is a very important component of our ploeftability and orlando, which is also a resident show, and from there we'll take more time to bring back our touring shows >> daniel, it's morgan we've seen in the midst of the pandemic some shows, some performers who are perhaps best known for their live events and their live entertainment strike streaming deals with some of the big players like netflix and others out there is this something that you're in talks to do as well? >> yes, we have used the crisis to do some experiences we have been showing content on social media every friday night, and so far, we have reached out over 15 million viewers around the world, which says that there might be a business opportunity for us there nevertheless, we remain a live show company, so it might be an additional stream of revenues for us, but it won't be the core of our business moving forward >> daniel, when broadway announced that they would be closed for the rest of the year yesterday, there was some talk about the unit economics of the house, the general sense is you need to sell 90% of your seats to make any money on broadway. is that different in vegas, or any of your touring shows? >> yes, fortunately for us, the break even is more around 40% of occupancy, which means that with the social distancing, if we could operate with 50% of capacity, we would start making a little bit of profit so that's why we're hopeful that we could open some shows before that, but then again, to really go back to the level of profitability that we have before the crisis, we need full capacity >> when the shows do reopen, what will the theaters look like >> first of all, as i said, if we have to respect social distancing, there will be measures for security, take the temperature of people when they walk in the theater. we will force our people to wear masks in the early days and we will take a lot of measures for our artists to be safe and we will respect and have already started working on how the seating will be organized to respect the social distancing. >> given the specialty of your performers, we open, you expect they'll be available to you when you need them, but is that a concern or are some of these people not going to be there perhaps doing other things >> the good news is all of our cast and crew in las vegas lives there, so that's why we're hopeful that we can open vegas first, because the artists are ready to go. so within a couple of weeks of training and rehearsal, a show can be back on track, and same thing in orlando the artists are living there it will be more complicated for touring shows, because we cannot open touring shows unless all the airlines are working, you know, on a regular schedule, and that all the borders around the world are reopened because when we do a touring show, we tour in 450 cities around the world >> right and finally, mr. lamarre, when you think about the future, so much of it is clearly uncertain and dependent on a vaccine, but when do you see cirque du soleil getting back to the samelevels of profitability, the same business activity that it was prior to the pandemic? how long is it going to take >> it will take and our business line is quite precise on that, it will take a good two years, so that's why we want to be patient, we want to be careful to be able to survive after those two years, but today i feel much better because we have the support of so many people that want us to succeed, including millions of fans around the world >> yes, and we appreciate your joining us today to walk us through a bit of what your plans are. obviously with the bankruptcy filing, daniel lamarre, the ceo of cirque du soleil, thank you >> thank you very much it is time for our "etf spotlight. today the spdr s&p 500 etf trust ticker spy on a rebound, up double digits boosted by one of its largest holdings which is norwegian cruise lines, largest holder of nchl it has benefitted from the 50% plus gain over the same period, the quarter-to-date. we'll speak with the chairman of norwegian in just a few minutes from now at the bottom of the hour so in thmeti, ayit use anmest wh hey there people eligible for medicare. gimme one minute... and i'll tell you some important things to know about medicare. first, it doesn't pay for everything. say this pizza is your part b medical expenses. this much - about 80% - medicare will pay for. what's left is on you. that's where an aarp medicare supplement insurance plan, insured by unitedhealthcare insurance company comes in. this type of plan helps pay some of what medicare doesn't. these are the only plans to carry the aarp endorsement for meeting their high standards of quality and service. so call unitedhealthcare insurance company today and ask for your free decision guide. with this type of plan, you'll have the freedom to choose any doctor who accepts medicare patients. and when you travel, your plan will go with you - anywhere in the country. whew! call unitedhealthcare today and ask for your free decision guide. a lot goes through your mind. with fidelity wealth management, your dedicated adviser can give you straightforward advice and tailored recommendations. that's the clarity you get with fidelity wealth management. good morning i'm sue herera here is your news update the european union is opening its borders to nonessential travel with 14 countries and the united states is not on that list the so-called safe list includes canada, south korea and japan. china will also be included if it allows eu travelers to visit. in arizona the owner of more than a dozen gyms is suing the governor over the latest pandemic reclosures. tom hatton says his gyms and 1,500 employees are being unfairly targeted. he says the gyms will be open today, despite the governor's executive order. and in nevada, three casinos including the bellagio and harrah's are being sued. it says the casinos did not immediately inform employees when some of the co-workers tested positive. you are up to date i'll see you again in an hour. "squawk on the street" continues in just a minute welcome back to "squawk on the street." our next guest is perhaps the ideal choice to talk to reopening as we see a resurgence of covid-19 cases. russell galbut is founder of crescent heights, and also chairman of norwegian cruise lines and joins us now russell, thanks for being here >> good morning, morgan, thank you for having me. >> a lot to get to, but first i do want to start with real estate and just take your pulse in terms of what you're seeing, given the fact that crescent operates in a number of major markets and you have exposure both in terms of residential real estate but also mixed use certainly we've seen some green shoots in terms of recovery in single family housing especially but whether it's from the multifamily side of things or from the commercial side of things, what are you seeing in your business especially in places like florida, where we are seeing some scaling back in terms of reopening efforts >> that's correct. south florida has experienced a resurgence of the virus and thus some of the plans that we had made we had to change. so hotels, for example, in dade county, basically instead of opening july 1st will be opening sometime after that, whether it be august 1st or what have you part of it has been a little inconsistent in the sense that flips flops, beaches and bars may have been closed earlier on and pools to hotels have been closed i think we have to do what is in the best interests of everybody and do it in accordance with a plan >> we had a dallas entrepreneur on, somebody involved in real estate and restaurants on the show yesterday, and one of the things that he said that he saw was the potential for a looming disaster for a number of different reasons, as some of these states like texas, like florida, have scaled back on restaurant and bar openings, hotel openings, et cetera, that there could be another shoe to drop in terms of real estate, if we see these reopening efforts i guess curtailed or slowed, and extended longer than anticipated. is that something that's concerning you right now >> well, i think it should concern everybody but we are a very resilient group of people and with proper leadership and proper planning it doesn't matter if we reopen fully two months later, or three months later. what really matters is that we open in the right way and we do that together with government, and in the right, precise way so that it's safe and correct z>> are people paying their bils or rents right now at your properties >> for in general, yes, they are paying and we are working with some tenants, and this is a time where we together have to pull together and cooperate and obviously we have great tenants, and those that are encouraged to reopen and to focus on business, we have to help them, and we are doing so >> mr. galbut, norwegian cruise, of which you're chairman, we all know the challenges facing that industry right now has the company raised enough capital? does it have enough liquidity to get it past whatever date it's going to be, where it can fully resume operations? >> yes, we believe so. as it relates to real estate, obviously miami is the international capital of the cruise industry. it's the number one location so it jeb rates a great many room nights and we need the cruise line industry to come back in total to help in our community of dade and miami-dade >> is there a date at which if in fact things continue to worsen that you won't feel as confident in terms of the liquidity position of norwegian? >> i think we're in a good position today, and i'm really not worried about that i am more concerned about incentive programs and plans for real estate throughout america, working together with government to create those type of incentive programs and create jobs i think now is the time for the industry, the real estate industry and the professionals and the planning departments or the municipalities throughout the united states to figure out how we can get industry back to work, and create jobs for everyone >> so what are you talking about specifically there, the fact that a lot of restaurant tours are not going to be in a position to pay rent how do you get them up and running or small businesses? give me some specifics here when you say that most of your units are residential but you seem to be talking more about commercial. >> we have commercial and residential. obviously our residential, we're at a 98% plus pay rate and it seems, it appears to be fine as it relates to commercial, obviously that's been more hit, and retail has been more hit so what we think has to happen here is that the ppp plan, we need to have another, because there is a resurgence of this virus, and we need to keep our small businesses alive in america, because this economy will come back they're the number one creator of jobs, and we need them to do well so in order to do well, they have to survive this open and shut phase, where we've had this resurgence of this terrible virus. >> yes, and how are you dealing with your tenants who are unable to pay rent? are you willing to forego it for a bit? are you looking for it to be deferred how are you dealing with it? >> we work with everybody individually, and whatever is necessary with deferral, postponement or half pay or past due pay, we really don't have any problems, i'll tell you. honestly, we're looking at this as being in the same boat as everyone else, and trying to help everyone in the best light possible >> i want to go back to the cruise industry for a minute how long do you think a full-on recovery is going to take for that industry right now? and will it actually recover to pre-pandemic levels or is there a new normal we should be thinking about in the coming years? >> well, i'm glad you asked that question i will tell you that the cruise line industry will come back the american people have found it to be a fantastic vacation, a wonderful entertainment center it will come back, and the pent up demand will be strong it's just a question of having the right protocols in place, whether it be a vaccine or other methodologies to deal with this. there's no doubt in my mind that two years from now, there will be more people cruising than last year or any other year in history. >> given the fact that you are joining us from florida right now and what we've seen in terms of some of the policies and policy changes in recent days, recent weeks, i wonder what a business leader like you, how you would counsel the governor and officials right now, and if you think that the steps that are being taken are the right ones or if there's more that could be done to help i guess with the economy, boost business, keep people and businesses afloat during this time >> thank you, morgan i would say to them and i would share with them to have patience i think we're all in this together, as i've said earlier on this show, and ultimately it doesn't matter if we're fully opened a month or two later. yes, we may need another ppp plan to take our small businesses across the plan but i think it's time for careful and direct reopening of our small businesses, our restaurants, our beaches, our bars, and i think that another month or two is not going to harm our small businesses so i would offer the idea of patience, and transparency >> and just finally, should face masks be mandated? >> absolutely. >> all right, russell, thank you for joining us today we appreciate it >> thank you thank you so much. have a great day >> you, too. watching the markets here on this tuesday morning, we've had some conflicting economic reports, the chicago pmi was weak but consumer confidence was okay watch yields, though, ten-year 63 basis points, getting awfully cle t leslelsinostoheowt ve sce may. and here to help. here's a tip: get half-off the amazing iphone 11 on at&t, america's fastest network for iphones. second tip: you can put googly eyes on your stuff to keep yourself company. uh for example, that's heraldo. he's my best friend. oh, sorry nancy, i forgot you were there. get the amazing iphone 11 for half-off on at&t, america's fastest network for iphones. but a resilient business you cacan be ready for it.re. a digital foundation from vmware helps you redefine what's possible... now. from the hospital shifting to remote patient care in just 48 hours... to the university moving hundreds of apps quickly to the cloud... or the city government going digital to keep critical services running. you are creating the future-- on the fly. and we are helping you do it. vmware. realize what's possible. as markets wrap up a first half of the year, one top strategist warns it could get worse in the third quarter more "squawk on the street" coming up. marco...! polo! marco...! polo! marco...! polo! marco...! polo! marco...! polo! sì? marco...! polo! scusa? marco...! polo! ma io sono marco polo, ma playing "marco polo" with marco polo? surprising. ragazzini, io sono marco polo. sì, sono qui what's not surprising? geico helping you save even more on car and motorcycle insurance. ahhh... polo. marco...! polo! now get an extra 15% credit when you switch before october 7th. we believe we all want responsibility in creating an inclusive society and we have an opportunity to use our brand and our voice to drive meaningful change we're in conversations with facebook we had a great partnership we're standing and supporting the campaign, and we'll look for change on their part to sort of determine moving forward >> that was lululemon's ceo calvin mcdonald an "closing bell" yesterday talking about the ad boycott and lulu making a splash in the m&a scene this week with its $500 million acquisition of at-home fitness startup mirror shares are 5% higher on that news today and of course it had been or has been an investor in mirror, which is seen as a direct competitor to peloton, an at-home mirror, you can do classes, meditation, basically interact and have the at-home fitness aspect you might think peloton shares are lower but no, they are up another 2% today i wonder if you think we could actually seeing a dearth of m&a in the current quarter, we could see more deal-making happen. >> we'll see not unexpected given the volatility in the markets, the lack of confidence amongst ceos in terms of determining what the future really holds. i am hearing more about dialogue and conversations starting to become more in terms of activity we'll see whether that continues. of course the markets themselves can often dictate whether or not we'll see a lot more activity if we get more volatility, then it perhaps is doubtful, makes it more difficult to sort of determine pricing and things of that nature. there have been more than $1 billion plus deals in europe than the u.s the size of the mirror deal the way a lot of deals are done lately, about half a billion you talked about peloton, of course, a stock that performed extraordinarily well, one you followed pretty closely, morgan, certainly in your "squawk alley" deys with tesla, and shares of the automaker and many other things at an all-time high, $194.5 billion market value. there is a look at it, the stock up 150% this year. certainly there are those out there betting against it but perhaps they lack imagination. i can remember people betting against amazon when it sold books, because they said it doesn't make any sense the value of all the books that were sold doesn't equal the market cap of the company but they clearly lacked imagination. just wanted to mention tesla >> amazon is higher today and has been trading near record highs in recent weeks in general because it is unveiling a bigger push to basically recruit more space companies, commercial, civil, military, base business to its aws cloud platform and speaking at "squawk alley" they'll be talking about that in the next hour but the news came out at 10:00 and you did see the stock jump to session highs, so it also just speaks to, again, this idea of in terms of imagination a company that was once an online book seller, now making a bigger push into things like space, given the passion i think around space of jeff bezos, much like yelon musk. david? >> yes, are they really -- people want to paint it as a real rivalry is it musk and bezos >> i would say yes, because they're both focused on very similar parts of the space market, and that's whether you're talking about spacex with elon musk or talking about blue origin with jeff bezos or to a certain extent, given this news and the fact that it's building out its own satellite constellation amazon, too. >> all right later on, don't miss the cnbc special report "supermarket shock: crisis in america's food supply." premieres tonight at 10:00 eastern, and that of course is right here on cnbc after the break, the first latino ceo in nhl history, the new head of the arizona coyotes joins us on major step for diversity in pro hockey and the nhl's plans for restart. that's coming up next. stay with us our next guest was just named the ceo of the nhl coyo s coyotes. javier, welcome and congratulations. >> thank you for having me, i'm very excited to be here. >> hockey is a fascinating case study about how sports will return you arguably have a head start on the other major sports leagues. give us the temperature on progress, getting players in the right position, safety protocols, testing, and practice >> sure, first and fore momost safety is our priority we have instituted protocols each club has also instituted protocols for our players, trainers and staff it is a multi-phased approach. we have voluntary workouts we had about 20 of our players back from their homes. so they're now training, doing you know physical theraraining r whatever they need for the training camp. and in august we want to quinn with "preseason" games and go into elimination games which is unprecedented to say the least we are very excited to be in the post season against the predators. we're excited to come back and provide entertainment in these challenging times. >> the country is excited about it, too. you have had some players test positive what has been the internal reaction to some of that and have you seen any individual athleat athletes express interest opting out. >> we can manage and mitigate this virus we have very sincere in our relationships with our players when we had positive cases we did a lot of daily testing we have quarantined and followed all of the protocols and gone above and beyond we think that we're trying to do as much as we can given the scenario that we're living in. >> talk about the arena development and is it colliding with the case loads we're seeing in arizona right now >> sure, you know when alex morello, giving me this opportunity, we have known each other for ten years and done business together. and when you approach this priority one through five, i thought it was an arena solution and he reminded me it was one through ten. we made it very public arizona will be home i recently relocated we planted the flag and we're going to be here the question is what location is best for our team, family, business partners. i'm reengaging in them and nothing to report right now but we think there is a lot of options. this is a great hockey market and we think there is a lot of enthusiasm to see us have a solution that makes sense. in terms of the headwinds we don't live in a bubble, we want to just continue to manage and keep an emphasis on on safety. >> and you're the new ceo of the coyotes and the first latino ceo in nfl history with civil unrest and discussions around racial inequality bubbling to the forefront, what does that look like for the coyotes, but the n nhl? and how are you engaging in those conversations? >> i'm humbled i'm very thankful to the owner of theoyotes for giving me the opportunity. i aknowledge those that opened doors for me but i also want to open doors for the generation behind me. it is important to have diverse faces in these seats and you have done an incredible job of really promoting that deserve of the business imperative and seeing new faces, having folks at the possible, i think it is important to be at the forefront of the confluence of not only just sports, media, technology, and entertainment but also the forefront of what the sports fan looks like in america. i said often that we want to help and promote the sport, but to the hockey and sports fans in waiting and that includes a number of cohorts that may or may not have been successfully tapped into. that will be a key component of our strategy >> talk to me about the economics of your franchise at this point no one in the stands, rsns are key revenue for some teams in the nhl. national tv contracts maybe not as important as it is for other sports what will the losses look like and do you expect next year to be a normal season >> sure, i think normalcy is something we would love but we' we're having to adapt. we're trying to get through this opportunity to finish out the stanley cup playoffs we're trying to be in it we're constantly looking at opportunities to make good with our business partners. our media partners, our corporate sponsors, our season ticketholders. this is clearly a challenging time we think we have a plan to turn it around. no one expected this pandemic and health crisis. i think we're taking it in to phase one. let's be irn know vative and transformative we want to create financial prosperity in this moment and the league has been addiment they would like to resume when the is possible to bring fans in the stands finally, javier, to what degree are leagues sharing protocols for best practices between hockey, baseball, and the nfl. >> i'm not sure if the conversation is going on between the leagues. we have been talking with not just sports franchises, but businesses in general. it means reaching out to our business parter i er partners ay we don't have the market cornered on great idea how to manage these interesting times so we're being very transparent about what we're doing we're trying to learn from others and there is a lot of communication back and forth there. >> congratulations, quite a gig, thank you for the time and please come back >> thank you have having me. i really appreciate it >> david and morgan, we'll see you a little later good tuesday morning earthquake to 'squawk alley. we're closing out q 2 with a flurry of news tesla, even a vaccine high this morning. modestly positive this morning that is where we will begin to kick off this hour joining us know on the last trading day of the month, the quarter, and the half good morning >> good morning. >> i'm seeing mixed signals out there, tobias, i'm wondering what you're seeing there is still a lot of cash on the sidelines in this market that might suggest that investors expect some choppiness ahead. what is the impact of those two things in particular >> i think the choppiness point is critical. there is a number of things out there that we don't know about in terms of infection rates. what will that do to consumer rates going forward. i think people were happy with the idea getting out there again. but really i

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