tv Squawk on the Street CNBC July 26, 2021 9:00am-11:00am EDT
listening closely again to what the fed has to say this morning. what's on your -- let's summarize the show like you ask guests to do in five seconds, andrew, what would you say bitcoin? >> not bitcoin, i'd say positive tech earnings are going to rule the week, but we'll see what that really means to the markets, whether things moved either too far too quick or not. >> all right we'll do it, and we'll see you tomorrow, andrew make sure you all join us tomorrow, "squawk on the street" is up now. good monday morning, welcome to "squawk on the street." i'm carl quintanilla with jim cramer at the new york stock exchange david faber has the morning off. futures are well off the early lows of the morning on this final week of july peak earnings season, fed meeting and a of course a lot more talk about disruption from the delta variant. tesla today other big tech like
apple, alphabet, facebook and amazon also on tap the china crack kdown, beijing targeting both on tencents music licensing and the entire tutoring industry fueling further tensions between the world's top two economies. bitcoin hits its highest level in six weeks, amazon now reportedly considering accepting crypto payments. we are going to start with the china flurry of headlines, jim, whether we had a downgraded didi are from atlanta today just because the regulatory environment there is changing so quickly. >> it is amazing we all thought that perhaps what should happen is united states should block chinese companies from listing here, we shouldn't fund them that had been a big issue with the previous administration. turns out they don't want our money. it seems like they want to destroy american stocks. it's very difficult because eunice has done some amazing reporting, but let's just take a bank of america piece today
about the downgrading of the after school training, we're talking about some very, very liquid stocks. and they're saying there's a policy to -- sorry, but to reduce the burden of homework after school now, frankly, that may be the statement, but to me it looks like to reduce the value of american companies holdings, and is there a potential to believe that what's happening is they're cracking down on rich people who may send their kids to after school, and they're cracking down on companies that are -- that make you stupid, make you stupid would be like tiktok, would be like a tencent. when i say that, i mean literally they don't want people to to to be dumbed down. that one seems like -- that's an
online econ site i don't know why they're cracking down on that. whatever it is you got to get out. >> i'm thinking of all the reasons people were cautious in the past, transparency, business models people have wondered why they would do this to their own giants this is tencents biggest fall since 2011. >> you have to wonder whether there's also a crackdown on the rich, the property stocks that eu eu eunice yoon was just talking about. those rich people, i think that the communist chinese have come out in a multifr front against rich people and against education dumb down and also against rich people -- so far it seems uncoordinated, which is so hard we're going to hear from kevin johnson later had week at starbucks. they seem to have no problem i don't know, i have to tell you searching about why they would crack down on baidu. i said maybe baidu has too much
freedom. what are they going to do with alibaba? is alibaba okay? they have american financials. it's always been transparent or is alibaba just another company that they think the rich people have benefitted from. so i think this is an attack on the rich and it's an attack on people who are -- who are creating content that is not becoming of the chinese companies. >> there was a chinese official last night on the wires. he said that china is willing to deal with the u.s. on an equal footi footing. wants to see common ground today's headline is we're in some kind of stalemate when it comes to trade talks. >> they gave you a list of demands. i think our country uniquely does not like to have a list of demands from anybody so i think that's going nowhere, but it almost feels like 19 let's say 53 the russians, military, chinese
military what happens if they get together i know that would seem odd it does feel like there's a new axis developing against us, and we ignore it we ignore what the russians are doing. the russians, endless military the naval procession this weekend. the chinese endless military against taiwan, and we seem to think it's a trade issue it's clearly not a trade issue it's an issue of turning back the clock before nixon goes to china, and i think we have to be very aware of that i like competition i don't want cold war. nobody should want cold war. it's not good for business. >> speaking of competition, or not margin, aren't some of these regulatory moves out of china good news for our tech giants whom we're also going to hear from this week >> you don't want your money there. you want your money here, and i think that there was -- people are starting to realize i heard something this morning, i'm not against it, but apple had fall p behind the other tech companies,
so let's buy some apple. it could actually work our market is so hot, but any money that's over there and any pension money that is trying to figure out what they have to do to make their -- you know -- so i know it's the only game in the world. you can't fight that like sam cooke said, don't fight the feeling. >> right obviously we'll keep our eye on it today there's a ton of news out of china we'll watch with eunice's help back home more discussion about the delta variant. cases are up 3x. stat news has an interesting piece that we're in the middle of the fifth wave and this one is accelerating faster than the first two from the spring and summer of last year. >> look, stat news has been really terrific, but you know who hasn't been that great, dr. fauci.
i find dr. fauci to be uniquely behind in everything, and comes on the shows and i'm going to say something that's a little damning but maybe -- at times when i'm spread too thin, i don't do quality work. when you come on tv every minute, you're spread too thin i prefer the work of dr. gottlieb who had been very negative and said we were about to have a big wave that was true. now we're getting the big wave and he is saying that we are right behind uk and we're about to peak in two, three weeks. i have never wanted to take on dr. fauci, a distinguished man who spent his life trying to do the entire thing when you're spread too thin, i'm going to just generalize when i'm spread too thin, you're not going to get much out of me. this man is spread way too thin. yesterday he was doing red state, blue state, that's fine that's true. what i care about is herd
immunity from people who have it, a much more granular approach of fauci. these are people who are distinguished people who are all speaking different languages, don't tell us what to do, don't keep track of the right information and are really a travesty. >> that's one reason why there's a lot of sympathy for those who are unvaccinated because they have been given so many kinds of messages you mentioned gottlieb on squawk he did refer to this notion if you look at the uk how far off might the u.s. be from peaking, here's what he said. >> the uk is turning the corner, it's a pretty good indication that maybe we're further into this than we think and maybe we're two or three weeks from starting to see our own plateau here in the united states. >> tom lee our good friend, does a lot of good quantitative work on covid says if the u.s. follows the template of the uk, daily cases here might peak in the next 12 days. >> that's unbelievable. >> we think energy epicenter
stocks will begin rallying this week. >> wow, they've been hit, there's always a kind of a comic undertone. we always say dr. gottlieb who's on the board of illumina and pfizer if you're on the board of illumina and pfizer, you know more than anybody. the board of pfizer is probably the epicenter of knowledge and illumina is the epicenter of detection. we can say whatever you want, but who -- what board is dr. fauci on >> i don't know. i don't know if he's on a board. >> he uniquely wants to avoid money, and i totally get that, but dr. gottlieb gets probably daily updates not just from the cdc and johns hopkins, he gets them from pfizer and pfizer and moderna are the two companies that know much more than anyone in our government >> right >> who are these people? who's the fda? i mean, the fda approves an alzheimer's drug that actually probably has no efficacy
i do a lot of work with brain society, american migraine foundation there may be no efficacy for that thing you can't tell people you got to get vaccinated so the fda with one fell swoop could maybe get 50 million people vaccinated but i mean, in the old days i would have said they're a bunch of clowns. >> as for the impact on equities, david costman of goldman sachs, we think the delta variant should pose a minimal risk to the u.s. equity kmarkt from an economic perspective, widespread vaccinations and strategies focused on containment suggest limited medical and economic downside even if infections continue to rise. >> we know that where it's worst is texas look, i don't know why you can say why it's best is texas because maybe they just want to get to herd immunity quickly. it's the hottest market for housing.
hottest market they can't find homes. it is entirely true that there's worry about the variant, but when you want to buy a home, that's a pretty major purchase, and it's certainly -- if anything accelerated, so how bad could the variant be if people are seeking it out. >> wedbush to outperform 125, they were at 94 on this idea, jim, that the last week's selloff was an overreaction in their view. >> but horton decided, you know what, we're not going to build homes unless we have appliances and windows, whirlpool doctor, i call him doc, but one thing you have to understand when you look at horton, they are trying to not take money from people and then not have homes. so they're slowing things down without the fed's help i thought the horton call was
very, very good. then i hear melissa, becareful, jim, it's a head and shoulders i'm exhausted. the whole stock market has been a head and shoulder the whole year and it's been fantastic take this, reverse head and shoulder. >> we're going to talk more about some of the calls, speaking of reopening plays, upgrade of six flags today, but also zoom being named a top pick at b of a. bitcoin, what a night last night, jumping to six-week highs as amazon is reportedly moving towards accepting it for payment. that story has not been matched by many news organizationin s dow futures were down early today, more "squawk on the street" from the nyc in a minute
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getting some breaking news on the wires here regarding crypto tether executives reportedly facing a criminal probe to top bank fraud the doj is looking into whether tether misled pbanks about its crypto business. we can look at that as well as the action in bitcoin over the weekend on the heels of this unmatched story that amazon might consider bitcoin for payment. >> is it possible for us to call up the unbelievable interview that deirdre bosa did last
weekend. it was astounding. if you left there and you thought, you know what, i wish deirdre bosa had subpoena power because it seems opaque, you know who does have subpoena power, justice department. they got unlimited resources and we definitely have to look into this because i thought that if you listen to deirdre and you were the justice department, you would place a call or if you're gensler these guys do stable coin, in which they're very unstable. new york state does not allow them to do business. they had an 18 mer$18 million fe remember, tether is about 60 -- what, about $60 billion in stable coin, and about tim basset who used to run the cftc said look, these are the guys they're worried about. and well, criminal probe, they're much bigger than people realize. >> implications for commercial paper and a few other things as well. >> i couldn't find anyone in this commercial paper market who actually does business with
them where is that commercial paper, and is it chinese commercial paper which historically has been difficult to rate again, if you watched deirdre, this is some day because if we didn't hear the bitcoin noise and news about amazon, somewhat unsourced, then bitcoin would be down very big. instead because of maybe a short squeeze or something, this tether news has not percolated enough >> do you believe that surviving 30k a couple times now has create created a firm floor >> yes. >> you do is this. >> >>. >> e themethereum is breaking dn too. i can't think of another company that would make you want to cover your short in bitcoin or crypto than amazon i mean, who? like walmart, walmart, they're going to take bitcoin. who cares.
amazon, wow. so we got to prove this one before we just say it. >> it's the kind of story that historically you could argue would have been matched by somebody. >> somebody by now >> and remember, their cfo, very conservative company, by the way. it's not like they're just sitting there saying we ought to take something, like andy jassy the new ceo, you'll see square popping again. square is the way to play for the towers coin base, which very uneven one is up 13, but these are big developments, and the tether criminal probe, again, the justice department -- that makes it very uncertain. who are the executives now we know that we may not even have jurisdiction over them, but we do know that they are the sixth biggest player of commercial paper in the world, and that's not to be trifled with >> right do you think overall direction fa
ally there's been progress in using bitcoin as a payment mechanism? >> i do. >> you doe >> i do. not just because of that non-fungible token wave that happened, back there with the steve jobs letter last week. i think it's become the discussion if you're mastercard or visa, what do we do i think there are a lot of people who wish it weren't here. jamie dimon. but it's here and people own it and particularly you know who owns it? the millennials, robinhood, and guess who's about to get a lot of money, the people who are going to take robinhood public >> yes >> and 20 to 35% is going to the robinhoodies do they have more capital. that's what vlad, i hope vlad doesn't become less of a spokesperson for it. >> you like his candor. >> i had marc benioff on this week from salesforce, and he's become a firm advisory to vlad,
single source of truth marc says. >> interesting. >> yeah. very different. >> yes, very different. >> yes, very different very different no longer just an app but a source of safety that's marc benioff's message, and it seems to have gotten through to vlad. >> yeah. and some traders given the action over the weekend. we will get cramer's mad dash and countdown to the opening bell on this busy monday morning. takene m oore look at futures as we get the opening bell in about ten minutes. don't go away. at the lexus golden opportunity sales event. get 0.9% apr financing on the all 2021 lexus hybrid models. experience amazing. this (chimes) is the sound of change from pnc bank. it's the sound (chimes) of a thousand sighs of relief get 0.9% apr financing on the all 2021 lexus hybrid models. (phone alert) and of a company watching out for you. this is the sound (chime) of low cash mode from pnc bank, giving you multiple options and at least 24 hours oo
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they sure do. they do. they really do. mmhmm. workday. finance, hr, planning and spend management for a changing world. i'm dad's greatest sandcastle - and greatest memory! finance, hr, planning and spend management but even i'm not as memorable as eating turkey hill chocolate peanut butter cup ice cream with real cocoa. well, that's the way the sandcastle crumbles. you can't beat turkey hill memories. let's get to cramer's mad dash as we count down to the opening bell jim has been calling for zoom 2.0 for a while, and it sounds like -- agrees. >> exactly right, 2.0.
well put before i get started my stepson works for zoom, got to disclose that this 59 merger they think is a game changer it's talking about unified communications you get a one stop shop, you get a call center, you get zoom. that is a good business for zoom this bank of america game change for the sector naming zoom the top pick might be able to ignite this stock dock y docusign really taking off here, people who got hooked stayed with it after the pandemic waned. th i think people expected there would be kind of a goldman, jpmorgan move, morgan stanley, james gorman basically saying if you want to do well, you got to come back to work. it didn't happen they're outliers, and i think because they're outliers we have to have zoom we can't get rid of it i know that webex, cisco, very
competitive outfit you get ooh, that's a bad chart. i'm sure there's someone that can say wow, it held i do think this piece is worth getting because they've got checks that are positive, and i had -- i have to tell you, i had this 59 on multiple times, and they're a good ron trolop, they had great numbers. even though zoom paid a lot, it doesn't matter that company is a winner i know that people feel sometimes they're too aggressive, but that's exactly what zoom needs. >> yeah, 5 billion in cash, operating margins in the high 30s. >> people don't care at all about the quarter because they say that's got to wane once we open up. we ain't opening up. you know that's people just saying i don't have to go back or i'm going to go back a couple of days a week, and none of us has ever seen this let's say you and i just said, hey, you know what, i'm not in today. we have jobs
but a lot of people over the country that work don't -- no one knows they're there. law firms, like who cares. send me the brief. who needs -- >> show me the billed hours. that's all i care about. >> that's all that matters who knows where it's from. be aware that this thing is not going away hybrid means zoom. >> interesting note out of b of a. the opening bell a few moments away, and remember, you can always catch us anytime, anywhere, listen to and follow the squawk on the street opening bell podcast back in a moment
way, no one else in the stable coin sector has done yet. >> that's officials from tether talking to our deirdre bowsa las week the u.s. is probing into whether or not executives behind the digital token committed bank fraud. jim, a little more specificity here on these reports. prosecutors are scrutinizing whether tether concealed from banks the transactions were linked to crypto and apparently this focuses on conduct that occurred a few years ago. >> a few years ago, okay well, that -- just pointed out that when deirdre interviewed, the idea thatno one else has the audit is completely undrew that's just one of those things where you can just say it. it's not true. i mean, like the phillies are in first place. oh, no, they're in second. and then one of the things that really gals me is what they provided is a one pace pie chart. it's like a pie face it's just outrageous
they say they're working towards auditing, last time they said they had auditors. these guys, their story changes all the time if it's an old justice department, that does mean that they did, you know, possibly they did change their ways but we need more >> yeah, we've reached out for comment, and of course declined to comment the cnbc realtime exchange at the big board, digital health company celebrating its recent listing at the nasdaq. >> they're exciting, i was in that car, and he was driving it, martin, he was on this morning and he threw me, went 0 to 80 and it just tossed me right through -- i had just had my back operated on he was rear cclearly trying to e to have a reversal of that surgery. he's an exciting guy, an exciting car
congratulations. i think congratulations are in order because i think that this is the real competitor it's beautiful it's expensive, but he's planning, what, 2.7 million square foot. he's got big ambitions. >> not the only one. report last week that tesla's on a bit of a hiring spree as they look to ramp up sales. the space is heating up. >> we have tesla tonight that will always be exciting i hope they have a great conference call. netflix had a call they obviously had nothing to show they didn't talk about anything that they're watching. tesla better have an exciting call the really exciting stocks are putting know sleep come on. i mean, he's got -- i know he's not going to smoke a doobie anymore. that was probably a mistake. i do hope they give us some color beyond berlin, they let us cut the trees down. >> are you more interested in tesla as a proxy for ev, a proxy for bitcoin or proxy for china
>> wow, i think it's a proxy, actually, for china because what it says is i want to see if you play ball with the people's republic, whether they let you sell i think that they're going to -- i think he's going to have great numbers in china. >> you do? >> i really do i really do. >> yeah, because there had been some worries, i think they were around april that sales were -- there were reports that -- local players were being championed. >> that is definitely true i think, again, if you build it there, i keep hearing this like the people's republic is not against companies that build it there they are against america to some degree saber rattling, but it seems that some people in the government want competition, and others in the government want to stir up problems in our own country, and they are very shrewd they want us, i think, to take our eye off the ball of taiwan taiwan must be defended at all costs by our government, but
we're very quiet, and some of us are trying to understand why we're so quiet like why are we still viewing it as trade they're not viewing it as trade. why are we still viewing it as something involving jobs and money. it's cold war. you didn't do a lot of business with the russians during the cold war, other than we gave them bread. >> right you seem to definitely see it through a geopolitical security lens. >> i don't want to see it like that. >> of course. >> i think i want solid competition where they play fair, and that's what i want i do not want to see -- i don't want to call them rogue, but i would say a country that is pre-nixon because those were frightening times. >> yeah. >> and we don't want that. the chinese weren't that good at business back then now they're good i hope that there's some reconciliation that does not let's say sacrifice taiwan that would be a disaster >> it's a mixed ball this
morning. energy does lead i i hahave to hand it to you you called the top in oil, at least here in the short-term. >> well, let's see i know that the world could slow down under the -- with the variants the world could slow down if china goes back into some sort of, you know, a decline because the variants are there remember, we're not getting the true story, i think, in china about how second rate their vaccine is they need -- they need a vaccine that works when you have these vaccines that are 45 to 50%, that's kind of likeour flu vaccine, and it's not enough. one of the things we keep hearing about is even when the breakthroughs and a lot of people know breakthroughs, a lot of it's asymptomatic a lot of players who catch it in sports, now some of it is that the -- say in baseball, they're not all -- they're not all vaccinated. >> of course >> but apparently there's a lot of asymptomatic, now football is going to be quite different. >> these reports over the
weekend actually late last week that basically your players get sick, you risk forfeiting the game. >> let's say you're a player that is not vaccinated, how will the other players view you if you're taking away their paycheck that's how they make their money, and i think this is the first time i've seen a plan that says don't sacrifice your co-worker. i wish all places talked like that the nfl is the leader. don't sacrifice your co-worker >> they have been a tip of the spear on many protocols. meanwhile, there's a stories on the wires this morning citing nbc that new york city is expected to extend mandates to city workers >> okay. see, we're -- >> watching over time. >> we're all on tender hooks about the idea of going back to masks. also, one thing we haven't cov covered at all, these fires, there's just an element of --
there's kind of an apocalyptic feel about some of these things. my daughter lived in a town called ashland in oregon, and i'm reading that they're trying to save ashland. save these are cities we're ignoring it i think in part because oregon is very under covered. take a look at the sun, and you'll seed effect of fires everywhere. >> even here. >> yeah, even here. it's beautiful no >> air quality alerts in philly and toronto because of what's happening out west. >> we cannot -- we can't overlook this. this is a big step back for everybody, and it's just -- look, in the end we need more firefighters, i don't know, because i don't think we can let this continue. we can't have -- we can't have the air so polluted that people have to evacuate >> jim, we mentioned at the top of the show, busy week we're going to get the fed meeting. santoli made a great point this morning.
that is fed weeks tend to be a chance for the martkets to rotae a bit. be a little net defensive. >> i thought that was a great report basically what he's saying is we are at a crucial moment. of course i'm going to over dramatize the no hyperbole we are at a crucial moment for the cyclicals, which are hanging by a thread. we're at a crucial moment for energy what i really want to see if the cyclical reports a good number, does it matter for instance, otis reported a great number today it's barely working. i mean, it's just a blowout number and judith is doing such a fine job. there's no volume, and it is the summer these are summer weeks now, and i think people forget that you can't gin up volume. people are not playing
robinhood is going to be the test of volume otis doesn't mean much to the younger -- they don't know otis redding or otis worldwide. younger people know, yeah, they know they've got it the very young probably know hasbro, which up 7% in the premarket. 105 crushes $0.47, and i think we're going to talk to them later on this morning. >> oh, we do, because i've got to tell you that they are a video company, and they are a gaming company, and brian has negotiated -- these companies are doing quite well, and what's going on here, also been short position hasbro. people felt, you know, what, once we solve a pandemic, who's going to stay home and play monopoly what they didn't count on were all the other things brian is involved in. the magic, the gathering is one of the hottest things in the world. i don't think it's as hot as call of duty
it's certainly not as violent. grand theft auto, you want your kids a little bit more -- >> speaking of doing things other than playing games nclh has its first sale since march of 2020. we did get the upgrade of six flags at wedbush. >> yes, they're going to beat 2019 if we just go back, frank del rio who runs norwegian this is how screwed up our country is he has campaigned that everybody who sails has to be vaccinated, the crew and the customers, and the florida government's fighting them. under what principle the right to get sick? i mean, i don't -- the constitution does not have a right to get sick. i mean, that's not like the 20 whatever amendment so i think that frank has been dead right in saying that he wants to sail safely because if you don't, that industry is going to be troubled. >> yes >> so i salute frank he has been on the mark the
whole way. he's a great executive, and all he wants is safe sailing congratulations. i was going to go on the region cruise right before the pandemic because they have this haven line, which is so great, but, well, i don't know my wife seems to think that those are still not the place to be. >> yeah. >> the cruise. >> still some hesitancy on sailing. >> my daughter was in one of their cruises. you know, it was a music cruise. emd cruise i don't even know what that is frankly. for the boyfriend to be the bartender of the year at the -- i better not say it's called parker house he won the bartender of the year at parker house. if you're from new jersey, that's like being the mvp of major league baseball. congratulations to matt mullen for taking that on i only voted 40 times. >> other areas that might get some interesting today i see gap, deutsch goes to buy
>> how do you like that? >> volatile trends they argue are largely behind the company a path to consistent ebitda margins. >> i think that stock should be higher that's a matthew boss at jpmorgan stock at let ta doing quite well and old navy doing quite well. i was all gap this weekendand no one nigh. th knew if i had told them i was gap, i think the gap fits me well >> i see moderna. >> unstoppable. >> helping to lead the ndx we had record highs consistently over the last couple of weeks here. >> a lot of that is because they're saying this is something ben sell told me well before all this happened. he's got what should be targeted vaccines for cancer, which obviously would be the holy grail. >> so you think this is about more than -- you need boosters in the fall? >> much more amazon web services plays a role
there too. he's a genius, uncelebrated, had his first at the absolute bottom in 2020 was the day he had -- that didn't catch covid. if you take a look at the arc of this market, it's ben sells arc. it really is. >> amex, you've been all over the credit card names. >> what does that say about the variant? doesn't it say that the variant's not going to play a role or we have a situation where dr. gottlieb is going to be right i spent some time with american express. i don't know if you know this fellow, mr. squeri, he is different. he is of and by the people, small and medium-sized business. they are doing incredible things the millennials love the card. gen x loves the card it's almost as if i want to show the card i've made it. that's incredible. we're back to that era
it's not don't leave home without it now the commercials are very compelling you've got a business card and a regular card i salute him he has been -- he's taken that company to another level. >> yeah. and once international reopens, it's going to be a different story, although there was a piece out this morning out of reuters that the white house will keep existing travel restrictions in place for now because of the concerns about the delta variant. >> do you think that the uk is going to be the forerunner i do think there's a lot of anti-vaxxers say in italy. we don't know in france. macron has been very tough on the anti-vaxxers this is one of the things i don't like about -- it's not -- it could be a red state, blue state, but who are the red states in italy. you know what i mean there's just people who don't believe, and i think, again, if the fda, if you were to tell the fda, listen, guys, dead on the case say that your work says it works, then i think it wouldn't matter whether you believe it or not. you'd have to take it. the nfl way, you want to forfeit
your friend's business, go ahead. >> that's a great point. vaccine hesitancy is not uniquely american. >> right i don't like this idea that there is just -- we have a lot of rumors being spread i know that. that's absolutely true, but in europe they have many people, and they're not -- they didn't vote for trump >> nope. >> absolutely right. >> are those ballots still waiting to be counted? >> we're down 69 points here, s&p holding 4909 let's get to bob pisani. >> happy monday, everybody flattish open but the fundamentals about as good as you could possibly ask for, and the cyclicals are back leading today. so energy is back up bank stocks are back up, industrials started up they're flattish right now tech's been a little bit weak today. we've seen some weakness in some of the semis, nvidia, microsoft, oracle down a little bit but not much there you see the crane shares down 7%.
that's a 52-week low those stocks, many of the internet stocks many of them trading in china as well as here all to the downside. when i saythe mfundamentals are about as good as they get, we've been emphasizing how much earnings are beating expectations, but revenues have also been beating rather dramatically by 4, almost 5% that's unusual historically revenue beats have been very modest, 1 or 2%. in the last several quarters they've been going up 3 and now 4% in in quarter at the same time, q3, q4 estimates are rising with revenues very, very strong this place into a very, very big important cycle here so earnings rising but decelerating, revenues stronger than expected. there's concerns about higher costs. because we have higher revenues and because the prices have been rising to offset the higher costs, the margins have remained near record levels we have 13% margins in the first
quarter. that was an historic record for the s&p. 9 to 11% in the next five years or so. this quarter, 12.8% so far still near a record level. when you combine rising earnings, risiing revenues and margins that are stable near record levels, that, folks is why the s&p 500, why the broad market is sitting at new highs in terms of earnings, i know we're obsessed with tesla. i know we're obsessed with apple, and we should be. i tend to look at the big global industrials. that's what you want to look at. honeywell had great numbers last week 3 m is going to report on tuesday. this is another one of those big companies that sell across many, many different industries because they know what's going on in the global economy that's why you look very carefully at what the earnings call was like. they can speak to the global kpli economy what's going on. 18%, that's what's important with a lot of these companies, the revenue growth for the big industrials. it was 7 or 8% in the last
quarter. they're still talking about numbers that are going up. u.p.s. is kind of the opposite it was one of the big b beneficiaries of the pandemic. there's a sense u.p.s. might have decelerating revenue growth u.p.s. surprised everybody in the last quarter with numbers way above expectations so maybe decelerating revenue growth but the earnings are still going to be very good, and if they get close like the last time, there was a huge surf are prize and you see that big move up in u.p.s. as for 3m, they did very well overall and are still trading at a very reasonable multiple i was looking at it this morning, 18 to 19 times 2022 numbers. one of the big problems with some of the other global industrials, for example, honeywell, that's trading for a lot higher multiple. they were trading up 25 times. we've got a very reasonable multiple on 3m and the possibility for some outstanding
organic revenue growth keep an eye on that one, carl, back to you. >> bob, thank you. still to come this morning, hasbro is a big gainer on a nice quarterly beat and it's about a lot more than just toys. we'll talk to the ceo about that. first take a look at the bond report and see how treasuries are faring this morning ahead of new home sales, which we'll get in just about 13 minutes. yields, ten-year right around 1.275. we'll be right back. (sound of people returning to the workplace) (sound of a busy office) (phones ringing, people talking, meeting) the company we've trusted to keep us working remotely, is the same company we'll trust to bring us back together.
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was march of 2020. no not under our administration this is a negative development for those who think there will be a lot of m&a. >> even out of the financial earnings reports >> yes i know that there are a lot of m&a people thinking they will get deals through, but this is a clarion call, a wake-up call saying, listen, guys, this is a merg merger that they regard as making -- the industry is anti-competitive i would be very aware from anyone who comes on the show and there is no real change m&a. there is big change. >> yeah. regulators here. solomon referenced china regulators adding another tap on the brake. >> yes this is a very -- some people say very anti-business administration i think it's pro-consumer administration >> how about tonight >> okay. a terrific number, june, march, just done incredible work. and i think that the fact that the stock is down is more having to do with the market than it
does have to do with just, say, how great the company's performing and then a private company we will like to judy because she had remarkable -- look at the chart. remarkable quarters. i salute them for being tough on a couple of guys maybe an older suit, older things they is, maybe with new york state, sued them for it, but that's a very important lawsuit and you've got to follow it because this is a -- one of the biggest commercial things worldwide. >> we will look for more developments on this story today, jim see you at six. >> thank you. >> "mad money" with jim cramer 6:00 p.m. eastern. when we come back hasbro is the g biggest gainer on the s&p. we will talk about it in a moment dow's down 30 now. "squawk on the street's" back in a minute
futures were deep in the red early this morning but s&p and nasdaq have bgone green the final week of july, peak earnings this week, fomc meeting and a lot of discussion about the delta variant and infrastructure over at the senate meantime, new home sales out a few moments ago. for that to rick santelli. hey, rick. >> a few moments from now, carl, i can 't see that farinto the future, but we are looking for a number around 800,000. it's a big miss. 676,000. 676,000 seasonally adjusted annualized units before we see any revisions, if we continue to look at the past month as 769,000 that puts it down a little over 6.5%. and remember pre-covid we were around 730,000 in february of '20, 756,000 in january. so now we are dipping below pre-covid levels and really this
is one of the few reads that has done that outside of the reads right after covid hit in early 2020 and the high-water mark of 993,000 was in january so you could see that we have fallen, what, over 30% from that level, and it really dig down on whether it's labor or just a supply shortage, we look for more granular information from diana olick. >> diana >> a big disappointment on this read. >> diana, go ahead >> a big disappointment on that read, down 6%. i want to look at a couple of things that the median sale price is up 6%, which is why a lot of buyers are pulling back you also saw a huge jump in mortgage interest rates during the month of june. these sales are based on signed
contracts, not closings. people out shopping around during the month of june i am also seeing that the inventory that is the supply of new home for sales jumped from five-month splay to a 6.3 month supply this is what d.r. horton was talking about last week when they said they were pulling back on sales on construction because they were seeing that buyer pullback there so you will start to see that inventory coming up the good sign is perhaps prices could soften a bit with prices high for for land, labor and materials builders will have a tough time and again a huge amount of the number of homes sold but not started. so builders have big back lag. a disappoint not just in the june sales but the may revision lower. back to you. >> diana olick, thank you. got to love breaking news live on tv. 30 minutes into the trading session. here are three big movers that we are watching. we will start with bitcoin, getting a boost amid rumors amazon is looking into the
possibility of cryptocurrency. they had their best performance last week. you can see we are hanging just below that 40,000 mark so close to a six-week high. then tencent music under pressure as chinese regulators continue to crackdown barring the company from holding exclusive tries to online music. almost also an $80,000 fine against the company. shares down 1% amid broader selling pressure and some of those chinese tech names in general. finally, hasbro is popping after a big beat on the top and bottom lines. we will break down that quarter with ceo brian goldner a bit later this hour. shares up 9.5%. >> eyou in a minute. meanwhile, the delta variant continues to spread. just how much of a risk is it to the market in goldman's david kostin telling investors he sees minimal risk thanks to widespread vaccinations and even if infections rise he says there is limited economic downside that note was eng owed by scott
godly on squawk this morning with hopeful comments. take a listen. >> the u.k. is turning the corner it's a good indication maybe we are further into this than we think and two, three weeks away from starting to see our own plateau here in the united states >> specifically, he writes we think the delta variant should pose a minimal risk to the u.s. equity market from on economic perspective, widespread vaccinations and strategies focusing on containment suggest limited medical and economic downside even if infections continue to rise morgan, that's definitely those who are in energy and epicenter t stocks were hoping this doesn't trickle down to the stock market. >> we will keep talking about that we bring in for more on the markets with the major averages basically at the flat line right now we will bring in meghan, wilmington trust, and jeffrey at charles schwab good morning meghan, starting with you, i mean, it really does feel like
even though we are hovering near these record high for the major averages there is a wall of worry for investors and equities to climb right now how do you see it? >> i totally agree i think one of the biggest potential issues is this dichotomy between equity markets at all-time highs and real yields which are basically as negative as they have ever been. so how do you square those generally, you don't see that bifurcation last indefinitely. we do expect rates to converge to equities, not the other way around i agree with a lot of the comments that were made around the delta variant and i wouldn't be flippant or cavalier around those risks at all it's certainly one of the biggest risks to our bullish call on equities, but i think it's either going to be a temporary flip that we have to get over or, if it is more persistent, it could be something that actually serves to dampen the speed of the recovery and perhaps elongate
the cycle in the u.s. and avoid that boom/bust that would not be good for he can trees. >> jeffrey, how big do you see the risk of the delta variant on the markets at these levels right now, especially given the fact that we have a fed meeting this week and the busiest week for earnings as well, and so far those have been really strong? >> yeah, an olympic-sized week for earnings the battle between earnings and delta, earnings have been winning the last four, five days what happens when we are past the peak and the data continues to be somewhat disappointing in terms of the global spread this is the number one issue affecting markets this year. we have seen the global case count fall and rise and fall and now rise again and along with that the relative performance of cyclicals, international stocks, value versus growth, the yield curve, currencies like the yen everything has been defined by this relationship. and i'm afraid as we get past the peak of the earnings season that news will come back to bear down on the market, maybe see a
little bit more weakness in cyclicals before they pick up in the fall heading into the fourth quarter. >> meghan, the fact that we have this fed meeting this week, increased headlines, data points around the delta variant and covid cases here in the u.s. and abroad, we have had such hot inflation ratings. does this give the fed more cover to basically stand pat, stay perhaps more dovish for longer >> i do think on the margin concerns about the delta variant would lead the fed to be a little bit more cautious perhaps, wait a little bit longer to be talking in earnest around tapering. certainly we don't expect a rate hike until probably 2023 at the earliest so i think the fed from our perspective, there has been a real questioning from investors about whether the fed is serious regarding their commitment to let inflation run a little
hotter, and their commitment to this labor market recovery really being a full labor market recovery and inclusive we don't doubt the fed as nearly as much as some investors seem to be. we think they will be patient. we think a taper is in the offing end of this year/early next year, but rate hikes are a ways out. >> as we're talking, s&p record high, nasdaq record high as well jeffrey, there is a story out this morning out of reuters citing a white house official that they are not going to lift any existing travel restrictions at this point because of delta variant concerns is that a signal that those who had hoped for nmore energy behid epicenter names will be disappointed in the coming months >> we will have to see certainly in the near term it looks like the momentum is towards more restrictions. we are seeing this in europe, more restrictions in place in summer travel. we have seen this in asia as well and now perhaps in the u.s. and so that further reopening
trade maybe more airline bookings, hotel bookings, theme parks, that may, yeah, that may fade in the near term. but as we look out, the u.k. is a great guide, carl. the u.k. has seen a peak in this second or what is it third wave of the covid cases as they have started to come down and we haven't seen deaths tick up. normally at this level of infections deaths should be 1,000 a day and we just got 63 a terrible loss of life, but nothing compared to what you would expect with hospitalizations and deaths requiring more widespread economic restrictions. >> so, yes could be a longer wait for the airlines to power back am i think as we look to the fall and into the winter those stocks will be back on top. >> yeah. that was actually a big topic of discussion over the weekend, meghan the u.k. plateau and rollover if you look at some of the charts in terms of new cases and the argument was made last night that wall street's not going to wait for the u.s. to roll over in whatever it is, 12 or 15 days if you use the template, u.k.
will be enough do you agree >> i do agree. >> i do. and i think that's the key message. i think the u.k. has been a leader in all of these issues. the u.k. is a similarly highly vaccinated population to the u.s. and now to europe and even to china that's why i think it acts as a good precursor for the markets. >> quick last word, meghan >> yeah, i agree with that i would take it a step further i'd say we haven't seen nearly as much recover friday in emerging markets and certain parts of developed international markets and that the equity market is going to be looking ahead to that recovery as well. >> thank you for joining us. >> thanks. as we head to a quick break, our roadmap for the rest of the year the biggest earnings movers and what's to come as a third of the dow and s&p report results this week. >> robinhood is reinventing the road show. a key investor ahead of one the biggest ipo's of the year. >> and brian goldner joins us on
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the quarter. good to see you. good morning. >> fascinating quarter revenue up 54. consumer products up 43. s entertainment up 47. what about people that thought there was no way you could lap last year's comps this year? >> we talked about this in the fall it was great to see the e 1 business accelerating, our tv and film productions up and running, a big new dungeons and dragons movie in product for first quarter 23 we are division a teachers series in broadcast. our wizards of the coast business is really accelerating. we are ahead of schedule with our doubling of that business over a five-year time horizon and we believe more growth is absolutely accomplishable and we will set our objectives and targets for stakeholders in the near term for the next phase of growth >> i want to talk about the gaming element, but on
production we have heard some anecdotal reports of, for example, season two of "bridgerton" is paused because of covid concerns. could you think this delta teleis going to be a huge interruption of the new season of production? >> we are applying the covid variants and all of the protocols and it does impact our business we want to make sure that the crew and the cast are safe i am happy to say that the d and d production, dungeons and dragons production, is going on okay where we have some small pockets of issues, the team immediately addresses it but we have to be hopeful and very careful clearly, it does impact our costs as we do bring those costs into our business. and it will improve margins over time in our productions. we just want to, first and foremost, make sure people are safe and we are able to get these productions off. you're right clearly, we are going to have to spend more time and focus on this over the next several
months. >> on games, how are you thinking about mine share being taken by travel, going on vacation, the kind of things that were impossible last summer >> our brands are amazing because it's about lifestyle gaming and gaming for an entire lifetime so if you are a magic gathering player, you are going to play face to face but you are also going to be playing on the imagine arena online we launch mobile a few months ago and it's accelerating. it's giving people the opportunity to play in all the formats they like. so, yes, you can travel and you can go out and see the world, but you can also take time and connect with friend and find people to play a game with in your down time so we're seeing about nine hours per week in people playing online people continue to go play there, and it's feeding the flywheel of analogue in face-to-face play. >> brian, as we enter what's
usually traditionally peak shipping season for the container ships right now ahead of the christmas holiday and whatnot later this year, what are you seeing in terms of supply chain dynamics and how is that affecting you from a cost perspective? >> yeah, morgan, great question. we are adding our -- our team has done a tremendous job. they have been through this already this year. they have added a lot of domestic ports they are adding international ports. we are adding carriers we took a price increase that will go into effect fully for fourth quarter and it's to cover our costs and to maintain our gross margin to ensure we achieve a 15% or better profit margin that we set as our target for the year we will see the costs come in your business. on average ocean freight is on average four times nor expensive than it was a year ago our team is finding a way through the retailer and our retailers are also
partnering because we can use our domestic shipping capability but also use their direct import capabilities you will see more of a mixed shift and blend between the two as we go through third and fourth quarter. >> so price increase meaning consumers will pay more for your toys and board games and the like >> yes there will be a price increase around the world we are being very careful that price increase is just covering our costs. but given the high demand in many of these product categories and new innovation and new products and many associated with incredible content or content and commerce, we are seeing that the pricing is holding and that the consumer sees the value in our product. >> brian, stock's, obviously, reacting here. sharp increase, up 10% to 101 and change great to see you thanks. >> thank you, guys kicking off the busiest week for earnings for the quarter, we have got the breakdown of
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taking a look at china etf ticker mchi, down 10% the last month and continuing the trend lower today amid china crackdown on pace for the worst month in a decade 2011 education names among the biggest in the red today after beijing announced friday new rules barring for-profit tutoring in any core school subjects we will continue to watch that story. jim had a lot to say about that this morning. >> i bet these charts have been ugly, ulgly for the last couple of days. lockheed martin reporting results this morning kicking off defense earnings we get a bunch of names this week revenues up $17 billion. beating estimates. gaap eps of 652. not directly comparable as it includes a 61 cent charge in aeronautics tied to what the ceo says is a performance issued on a classified program a full-year eps guidance though
for the second quarter specifically, sales rcrew in al four divisions space up 10% profits jumping 33% ledmy national security work also saying that strong growth in new tech including hypersonics was very much a part of what we saw there as well on the f-35 fighter jet program the forecast is low-single digit growth this year that's not a surprise with production starting to plateau but modernization increasingly in focus there on the aerojet acquisition, given the biden administration focused on deal-making competition and scrutiny from senator elizabeth warren reiterating lockheed's pitch this would create -- also industry partners and he expects that deal to close in q4 of in year lastly, with the senate arms services committee looking to boost the 2022 defense budget by $25 billion, i asked about san
diego padress for defense spending at lockheed and he said, quote, right now we feel pretty good about where we think this is going. nonetheless, given the results we saw this morning, shares are down about 3%, carl, and only up about 3% so far this year as well. >> wow, underperforming in the broader market interesting. it's an interesting year for defense given so many geopolitical tensions, but, obviously, stocks not reflecting that at least to a large degree. when we come back, robinhood reinventing the road show. stay with us you packed a record 1.1 trillion transistors into this chip i invested in invesco qqq a fund that invests in the innovators of the nasdaq 100 like you become an agent of innovation with invesco qqq that building you're trying to sell, - you should ten-x it. - ten-x it?
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capital partner, good to get your take. good morning good to see you. >> good morning, carl, how are you? >> tech is leading for month we got some fresh highs on the indices today. largely because of tech's help how much do you think we are going to get in the way of information given the earnings on the way >> interesting so i think tech is, obviously, causing a lot of disruption the last year and a half i think you are going to continue to see that, see some tech names have blowout earnings i think you will see some interesting dichotomy in tech. some of the consumer names. >> of the consumer names on cheap customer acquisition, some of the names relying on performance marketing you might see some weakness there primarily because i think consumers have started to go out of the home and a think a lot of those names will have a little bit of weakness in earnings. >> interesting i mean, what specifically? which names would you be thinking of when you say that? >> hard to tell.
i don't want to get -- i look across our portfolio, what we have seen is some of the hard tech numbers, the infrastructure technology companies are been exceeding and beating plan and some of the names going direct to consumer and relying on inexpensive customer acquisition have seen declines or slowness in their business. especially around what's been happening with the privacy and social media and apple i think those effects have started to play out in what we are seeing in this quarter i think it may be a short-term phenomena. i think things come back in q4 i think there was a little weakness in some of the consumer names in q3. >> there is a call out of luke capital on some beenterprise names. they cut palo alto, cut zoom their argument is that companies are consolidating and in some cases they believe, in this case making splunk their de facto platform but i wonder if you think the enterprise is similarly trying to get things into one silo. >> i don't have a preview on the
short-term aspects of what is happening in enterprise. long-term enterprise, i am very bullish. primarily because i think you are starting to see enterprises and companies look at their existing infrastructure and saying, hey, it's not m modernized snow make versus oracle, things like that, i think you will see. i am bullish on long-term enterprise i think short-term enterprise procurement comes back into the play, i think companies will do pretty well. >> what about fintech? we have thihad this surging pipeline of ipos people worried about robinhood late they are week a chunk of allocation to retail investors also what are the things you are watching jt fintech is one of the industries -- i think every industry will get disrupted by technology whether it's energy, health care, even government will get disrupted by it fintech the last three or four years, we have been investors in the sector primarily because
it's been like, you know, financial dinosaurs that have been in play and they have not really listened to tsunamis, what tsunamis want i think there are interesting companies that have had a great customer acquisition strategy and now they are expanding products robinhood is a great example of that i think they will do well. we see some in insurance you think you will see a lot of interesting fintech names that are going to disrupt the old guard and that's going to continue to be true for a lot of setters, including insurance, energy, government government is interesting to watch as well. government procurement has been outdated the lat coust couple of years. i think you will start to see more and more government purchasing of technology >> interesting i want to get your thoughts on robinhood and their live-str live-str live-streamed ipo road show saturday much we want to get details on that and get your thoughts on the other side
hey, kate. >> good morning. robinhood hosted a virtual ipo road show event this weekend specifically for retail investors using the trading app. we have new details about the future of robinhood towards the end of that session during q&a and during that q&a with customers robinhood's ceo says the startup is considering expanding into retirement accounts with iras and roth iras he says they are working on wallets for cryptocurrency users so customers can hold their own digital assets executives described robinhood as a single money app. they didn't talk about it as a brokerage firm they focused on other areas outside of trading they talked about adding more savings and spending products, for example. robinhood kbekexecutives identi ways away from trans-based revenue that makes up most of robinhood's revenue now, especially though, this is
increasingly important as payment for order flow comes under pressure if regulators go so far as to ban order flows, ceo jason warnock saying robinhood and the rest of the industry will adapt and, quote, we will explore other revenue sources. the management team chose loot of these questions with the q&a session. they say they had thousands of i admissions the ceo fielded one question that had nothing do with the ipo. a user asked about his favorite planet so they got into some of the astronomy conversation as well a little side note there he noekjoked that it was pluto. robinhood setting aside up to 35% of the ipo for retail investors. the company is expected to list on the nasdaq this thursday. guys, back to you. >> yeah. of course, pluto, there is the debate whether it is even a planet but i digress. payment for order flow, all of
the scrutiny, all of the regulatory commentary , is that the biggest risk for this company as it goes public and does that fspeak to this broade vision that was laid out over the weekend? >> i think robinhood, obviously, we are investors, so we have to be careful what we say i think the move to expand and diversify the product line is brilliant. as i said earlier, robinhood had created a very effective way for customer acquisition with the current products and i think as they move to a for fee-based product i will continue to be a bull of what they are trying to do to demachtize investing. >> as for the actual mechanics ipo and the road show, i wonder how inventive do you think this will be and how instructive for, obviously, a new generation of investors whom robinhood is actually bringing into the market in the first place? >> yeah. so, look, i have been in this business long enough to see retail investing ebb and flow in
ipos and overall in the market 35%, that's definitely at the high end of what i have seen historically the most is 20% or so. so i think they are definitely pushing a limit. there is a lot more retail involvement in the market today than ever and we welcome that. as long as it's investing. i try to tell people, my friends, family members, peers, investing is a long-term game. if you are investing for a trade, if you are investing for a, you know, momentum, i don't think that's good for long-term investors. you can't consistently make money over time by doing short-term trades. you can consistently make money by long-term investing i think that's the direction i would be pushing retail investors versus the trade mentality running around. >> i'm sure it's a balance you want to keep the customers over the long term haney, great insight good to see you.
thanks. >> thanks, carl. thanks, morgan. crypto this morning, tether executives facing a criminal probe into bank fraud. deidre has been following that and joins us >> hey, carl well, scrutiny of tether has been rising for years, but it's exploded in popularity this year so that scrutiny has intensified. it's now the third largest cryptocurrency by markets cap and the trading volume is nearly double that of bitcoin, but its use is different than a bitcoin. its function over speculation versus a bitcoin or dogecoin or ether. the poker chips, if you will, they have also been called the weak link of the crypto economy. questions surrounding the backings or reserves and there has been more questions on stablecoins at large from people like janet yellen to jay powell to gary gensler. they are calling for more regulation of stablecoins.
i sat down with two tether executives in a rare mainstream interview last week to get more answers on everything from what makes up their commercial paper to when we might finally see an audit, something that they have promised for years have a listen to part of it. >> just to follow up on the audit, i know that you said you would be thrilled to be the first sort of crypto company in stablecoin to go through an audit. to you have a date in mind >> no. we are reaching back a couple of years for the financial audit and that is in process. >> do you think that's years away, months away? any clues? >> months, not years. >> only months >> yes, we think so. >> so, guys, we do have something to point to, to at least hold their feet to the fire, but like i said they have been promising an audit for years. they switched account epts they do it through a cayman islands firm whereas it used to be a new york-based accountant
they said things like overwhelmingly their commercial papers a 2 or above. they wouldn't tell us whether it was chinese commercial paper or different, say, canadian commercial paper, something that jim cramer has been asking a lot of great questions in the end this interview led to more questions than answers and i think that what we're seeing now, this increased scrutiny is part of that as well, is we are not getting a lot of transparency on the flip side, guys, some argue who cares? again, its use is function it operates as the poker chips the people using them may not be calling for an audit as the regulators pay more attention, that is something that could happen and we could see whether it really is this weak link in the crypto economy which would, of course, have massive implications this is a $63 billion asset at this point back to you. >> just with that in context, a great interview. great reporting. thanks for bringing us the latest. rahel solomon with your news
update. >> the olympics update at this hour american swimmer katie ledecky said she fought tooth and nail but could not beat australian ariarne titmus in the williams 400 meter freestyle final. silver is her first, but she is taking it in stride. >> disappointed. it was my second fastest time ever i felt like i fought put up the best effort i had she had that tremendous race i think we delivered a great race >> and the u.s. did win gold in the men's 4x100 freestyle relay. zach apple in just under 47 seconds to beat italy. and a surprise victory, russia won gold in the men's gymnastics team final narrowly defeating japan. the 2016 olympic champions by 0. 0.10 of one point. china with 18 medals the u.s. second with 14. japan has 13 still, however, a very long way to go.
morgan, back to you. >> oh, we will be keeping our eye on that. thank you. meantime, l.a. county's seeing a rise in covid cases our next guess is forecasting strong growth ahead. and rick caruso joins us next. as we head to break, watch liucd motors today you can see the shares up about 15%. stay with us ♪ someone once told me, that i should get used to people staring. so i did. it's okay, you can stare. when you're a two-time gold medalist, it comes with the territory.
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welcome back to "squawk on the street." i'm frank holland. markets are trading near the flat line this morning the major averages managed to notch record highs from a sector perspective. energy is outperforming up more than 1% so far today a big drop this july which would snap an eight month winning streak every stock up 1% or more today. now i'll send it back wno
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next guest's ammunitions, however. his company report their best financial performance. rick caruso, a manager of retail and hospitality properties across l.a great to have you back best financial performance ever. break that down for us. >> what is happening, we have got a lot of customers across the nation and certainly in los angeles and southern california that have a lot of money, a lot of savings, and they are out spending it, and they are spending it across the board and i think what we've seen if you look at the card data, a lot more money is being spent on themselves outside of the home and they are shopping, they are dining, they are going to the movies and doing it with consistency in a high con certification rate we are excited about the growth we are seeing across our portfolio. >> so despite the fact that we are seeing these reports and increased case numbers around the delta variant of covid, you have got this reimposed mask mandate in l.a. as well, that's
not having an affect, you don't expect it to >> we don't see it having an effect maybe it will down the road. i don't think so your earlier guests were talking about how they don't believe it will impact the economy and we are not seeing that now. it's only in l.a. county also. the mask mandate but i think people are worn out and tired and they want to be out, so they will freely wear the mask if it's a requirement, obviously, they should but, you know, i am hoping that decisions that are made in this go-around, that they are formed by the data, they're formed by the science and we are out of the business of emotion and politics >> so given the fact that consumers are out and they are spending, i mean, certainly we've seen the trickle through of all that stimulus money, folks sitting on record amounts of savings how sustainable is this level of thinking do you think at your properties >> the estimate is across the country over $2 trillion of what's called forced safrvings where people have saved money because they haven't been out
and spent. the stimulus will end at some point. there is asth lot of money we h saved. when you look at the data, it's only beginning to be spent so i'm very bullish that we are in a big recovery here it's going to last for some time, i think the next couple of yearsk and good i.r.a..ers, good operators, good restaurateurs will be the big winners. >> that's fascinating. i want to drill down on movie theaters specifically. i know the grove has some experience in this recently on amc. what is it going to take for theater chains to bring back customers in large numbers and consistently in the months and years to come? >> haey, carl like everything during the pandemic, people want to feel safe, they want the place to be clean, they want a great experience you have delight them. amc, which took over the two theaters, one at the grove, one
at the americana, two of the highest grossing theaters historically in the country, they will be investing millions of dollars in new seats and ne technology so it's state-of-the-art all of us want great experiences. after we have gone through the pandemic you want a sense of joy and community and theaters do that and of course the studios have to put out some great movies for the big screen, which talking to the studio presidents, which i have done personally, they have got a great run of movies come out. so i think it's going to be big. i think amc is betting big on us and our properties they are spending a fortune on the properties and they are very, very confident that they are going to do some significant revenues and really beat the past highs that we had over the last decade in terms of total ticket sales >> rick, do you have enough workers? >> it's a problem. we have a problem across the broord our hotel, the retail, restaurants, we are struggling to hire. i think the stimulus needs to go
away it served its purpose. it was great at the moment now let's encourage people to get back to work and let's reward people with the right wages. >> rick, real quick, are you going to run for mayor really quick. >> i am being encouraged thinking about it. >> okay. >> thank you, guys. >> rick, thanks for all right, h you both thank you, morgan. thank you, carl. shifting gears, stunning proposal from jeff bezos to bill nelson in a letter released this morning offering to close nasa's near term budgetary short fall for the human landing system in a pitch to get the national team led by blue origin and also includes lockheed martin, northrop grumman and draper back into the key program bezos writing, the agency must act now to create the real competition it needs and it should not repeat work already delivered and investments already made this is in a surprise move back in april, nasa did award $2.9
billion to spacex as the sole winner for the lunar lander, citing budget constraints. since then, the team has as well as another bidder filed protests with the gao to better set to be resolved early next month. but in this letter, bezos offering to essentially foot the bill to the tune of billions on development and some testing of this lunar lander. and it really speaks to, carl, especially post space flight last week and bezos telling me that he plans to spend a significant amount of his time on blue origin now that he stepped down as amazon how seriously he is now looking to make that pitch for blue origin's different businesses after years of almost exclusively personally funding this broader space vision? >> yeah, it is always fascinating to see entire industries being built out of scratch, right especially in the private sector, but what's happened in space in the last couple of years is just astounding last week put a button on it too.
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welcome back tesla drivinging into second quarter earnings after the bell today. phil lebeau has what to expect phil >> they're expected to report a profit when they report their 2q results. it is the numbers within the numbers that people will be focused on three topics in particular, first of all, what was the impact of the semiconductor chip shortage in the second quarter musk talked about this a little bit. we don't know the full details in terms of how much it impacted the volume, what is happening with the growth in china they have the gig factory in shanghai ramping up deliveries and then the updates, two being built, one outside of berlin, one outside of austin, texas the total sales of vehicles, it is expected to be 861,000 this year, that's the consensus right now. by the way, that'sbeen moving up and down depending which analyst you're focusing on do they give us guidance for full year deliverys?
i don't think they will. but that's a possibility also for elon musk, what does he say during the conference call in the past, you would have conference calls where there are lots of headlines the day after. that hasn't happened in three or four quarters. and relatively muted, in terms of news coming out of them, so when you take a look at shares tesla and looking at them over the last three months, keep in mind they may likely report a profit and it may be way above expectations i'm not sure people will get too excited about that it is more what they say about the second half of this year, morgan that's what people will be focused on, especially automotive growth margins, they're expected to grow in the second quarter relative to the first quarter as they ramp up deliveries >> china we have seen a lot of pr blow back against tesla in the kuncountry and now the crackdown on other companies and other industries how could this play out for tesla? >> hard to say jim cramer was talking about
this earlier today and he said, look, they want to see things built in that country and tesla has been ramping up production at the gigafactory in shanghai a number of the reports that we get regarding tesla in china, they have been wrong the initial reports have been wrong. remember when there was a report, i think, in april, they said, they're going to have terrible sales, awful sales, and then when the official sales came out from the government, they were not awful. so this happens quite a bit. so i think people are a little -- they're cautious in terms of what might happen, not just with tesla, but all american companies over there, no reason to believe that tesla is more exposed than other companies. >> yeah, shares of tesla are up 2% now ahead of the results, amazing, down 6% year to date after what was a monster 2020 for that company just want to shift modes of transportation here, phil, and focus in on boeing as well, which we get earnings from later from this week the company saying this morning it aims to deliver sustainably
fueled airplanes by 2030 how realistic is this goal >> i don't think it is -- it is not that it is unrealistic it is that this is a chicken and egg situation. boeing wants to have planes that can fly 100% on sustainable aviation fuel. the airlines want that everybody in the industry wants it but you don't have the infrastructure that is there right now. sustainable aviation fuel is two to three times more expensive than jet fuel right now. and you can't blame the airlines while they want to fly more on sustainable aviation fuel, they're not going to pay three times more that has -- that price has to come down. and for that to happen, you're going to need governments to get involved and to say we need more production of sustainable aviation fuel. if that price doesn't come down, they can talk until they're blue in the face, the airlines and boeing and airbus, everybody can talk about it. it has to come down and be price competitive with jet fuel. >> yeah. it is such a key thing to focus in on, especially when it is not just passenger airlines, but also the cargo players like
fedex and u.p.s. that have put goals out there as well, and make up, you know, quite large fleets too phil, travel bans, delta variant, all the headlines we're getting. what does it do to the airline stocks here? >> look be at the airline stocks today, morgan. they're up between 2% and 4% despite this announcement out of the white house. i think everybody knew this was coming i don't think anybody expected that they were ultimately going to drop the ban on europeans coming over to the united states as the delta variant was spreading. i think within the last week, that attitude completely shifted in terms of those who were tracking the industry, and within the industry. so i think for the airlines, i mean, they're frustrated they would like it see europeans coming to the u.s. but realize this is a white house that has said we will not do it until we feel comfortable and they clearly are not comfortable right now. >> all right, phil lebeau, we covered a lot. thanks for finishing up the hour with us here just getting a quick check on the markets, very, very narrow
trading range ahead of what is a very busy week busiest week in terms of s&p earnings, that two-day fed meeting, which kicks off tomorrow, a ton of ipos including robinhood this week. we saw record highs for the s&p and the dow though energy is leading the pack, up 1.8% in terms of sectors that's going to do it for "squawk on the street. "techcheck" starts now good monday morning. welcome to "techcheck. i'm carl quintanilla with jon fortt and deirdre bosa coming up, chinese stocks fall as officials impose sweeping recession lagss. sparing no sector of the market. plus, bitcoin briefly breaks 39k with help from
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