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tv   The Exchange  CNBC  September 29, 2021 1:00pm-2:00pm EDT

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>> sticking with my netflix position still, steve. 6.25 to 6.50 in next coming months >> dr. j., final to you? >> like the net sports trade, ea up to the 139 strike, scott. >> bought a little more as i understand as well good to see everybody. "the exchange" is now. ♪ ♪ thank you very much, scott hi, everybody. i'm kelly evans. ahead this hour on "the exchange," a collision course with commodities that's what our guest warns the world economy is heading for as prices on everything from oil and coal to cotton soar. he has several ways for investors to hedge and even benefit from this trend. plus, even when you don't have a shortage of fuel you might still face a shortage of truckers to get it to fill-up stations like britain is facing right now. we talk to fuel logistics about whether the shortage could become chronic and how to solve the lack of drivers. in rapid fire netflix goes
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for gamers, macy's goes after amazon we begin with rebound in stocks there. it is there for two out of the three, dom >> i would say that the nasdaq goes negative right now, that's what you are seeing, kelly it is slipping, not a lot. at the highs of the session nasdaq was up roughly 130 points and now it is down 7 it is a stark reversal given the sharp sell-off we saw in yesterday's session. a lot of the markets losing a little bit of steam here the dow industrial still up about one half of 1%, 150 points to the upside. s&p 500, 4366. it has not been because of a sharp move in interest rates check out what is happening with the ten-year treasury note yield. right now, 1.53% remember, at one point yesterday we did get kind of some of the high levels but we haven't seen a lot of movement today in treasury yields. so the ten-year note yield, yes, it is still elevated on a
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relative basis but not the key driver of any weakness we've seen so far, at least in the nasdaq that we can see check out what is happening with the drivers of the trade apple, microsoft, alphabet, amazon and facebook, the five biggest stocks in the s&p 500, also large components of the nasdaq, big down days yesterday. trying to balance a little bit today. apple holding on to 1% gains microsoft, just about flat on the day. alphabet, amazon and facebook now flirting between gains and losses so, again, the big five showing some weakness here we will see if it changes at all in the afternoon session back to you. >> dom, thank you very much. see you again soon surging energy prices are the latest supply headache and possibly the most serious one yet to the global economy. my next guest says the world is on a collision course with commodities and energy and tech names will be a good hedge joining me of ariel investments, charlie, the vice chair. jerry, the chief investment officer. i will start with you, jerry i have been borrowing and
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cribbing from your notes here. tell me to what extent you things the commodities collision course can last. >> i think it is more a question of something that people have acknowledged and been able to observe, now actually coming to the forefront, right we have been talking about supply chain, supply chain, supply chain for the last six to nine months. a lot of the focus on it has underlined or masked what is behind the supply chain problem. what we probably will see in the next six months is now production shortfalls, right so today brazil is out with a horrible forecast for their crop production we know we're behind in oil and gas production because our inventories globally are behind. we just don't have the amount of raw commodity capacity today to touch the amount of growth that's most likely going to be in demand over the next six to nine months. so we're going to have to use price to adjust to that. >> right >> what most investors haven't figured out yet is what do you do after that and how long does
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that last, and then that's a bigger discussion about inflation. >> that's exactly where i want to go with this. i wish we had more time. so you say that people should hedge at least the near term of what you are talking about, this spike that could continue its upward trajectory with energy stocks like con owe co, diamondback and range. you also like tech, thinking rates are not a bigger threat to the business models ultimately let me bring in charlie. not that you are an energy and commodity specialist per se, but once again you are on in a week when the trade is coming around to where you stand we have rates going up, financials and energy starting to outperform. how long do you think the situation can last >> a lot longer. dom gave a great introduction, but the one thing he said is that the ten-year treasury is at elevated levels at 150 on a historical basis, absolutely not the average ten-year treasury rate since alexander hamilton created them in 1790 is 4% with the inflationary outlook that i agree with jerry we are going to have because of every
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input cost, energy cost, labor costs, big deficits, all of those factors are going to push inflation higher which will push interest rates higher, end of tapering we will have a lot higher than ten-year treasury at 150 i agree with everything jerry said except i don't believe it is good for tech stocks. when interest rates go up you use a higher interest rate to bring the future earnings back to the present so i think you will see the value stocks outperform. >> jerry, let's talk about with stocks on the tech front you do like so as we look at the nasdaq down again today, people are thinking about buying on the dips, microsoft, mastercard, nvidia, you are not exactly talking about zoom here. why do you like these names? >> well, it is important to distinguish between the broad concept of tech and something that's like zoom compared to something like microsoft at 30 times earnings and mastercard at a much lower multiple as well. we don't need low interest rates to support the fast growth rates that these big companies have
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and will continue to have regardless of inflation. so there's a big group out there that i would agree with charlie that don't really have a lot of upside in a rising rate environment, but don't think for a second that microsoft's forward growth is going to be at all impacted for that reason, all it is going to do is grind away at its 15% to 20% growth and that's a good return you marry that with some of these interesting oil stocks that are, say, trading at four or five times cash flow, that's a nice combination >> and it is interesting because even though you both seem to agree on the near-term outlook, you would be in different parts of the market. jerry, more in the energy space, some tech stocks you mentioned charlie, you are looking more at industrials and the financials, is that right? >> with some energy. i own apache, which is trading at 3 1/2 times cash flow, so there are some energy names i like a lot you are right, industrials, financials, financials are going to do very well when we get a steepening yield curve places like bank of new york, northern trust will do very well
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in higher interest rate environment. it is a contrarian trade when you look at the surveys of market participants. they still aren't getting it on inflation. these people are still saying it is transitory, it is going to come down. i just don't think it is right >> i'm not sure i'm getting it i mean i look at it, charl ie, and i think to myself it is demand destruction, it is bad for the economy, it is terrible for consumer pocketbooks how is it going to create lasting inflation? it seems to me the worse it is getting the more it could send us back into a downturn, not create some sort of continued situation with price hikes >> consumers are in excellent shape because wages are heading up amazon and mcdonald's are paying $15 an hour. the lower tiered wage earners are earning more we're getting -- it is a very good job market. it is a very good economy. there is pent-up demand. if we can get cars on a lot, we can sell them tomorrow housing prices all of these things make individuals feel better about themselves the consumer confidence number is well over 100
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we're going to have a strong economy, especially when we get to theother side of delta, and that will be inflationary. >> i hope you are right. i just -- like you said, i am still not there. i am kind of - >> you are with the majority the majority is with you, kelly. >> i know. >> but i don't buy it. >> kelly, can i jump in here charlie is right there's too big of a cushion for consumers around the world to absorb this price hit, and we don't see that hit having a big impact on the global economy >> no, i have seen the numbers, a trillion plus in excess savings and all of the rest of it as michael dard has been saying he predicted the taper and here we are we'll leave it there i appreciate you laying out the view for the next months time. >> thanks, kelly the other big market story is wasrby parker going public? while the company started as a direct-to-consumer play it has been rapidly expanding its brick and mortar footprint the co-founder and ceo outlined
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the strategy earlier on "squawk box. >> we have around 150 stores around today relative to larger stores our larger competitors have and the category trailed a lot of consumer goods in terms of ecommerce penetration it is still in the single digits and we have the opportunity to really scale through our leading offerings like our virtual try-on and our virtual vision test, and ultimately we don't care where a customer transacts. we just want to make sure they have the best experience possible >> so how did brick and mortar go from being a dinosaur to the future of ecommerce retail joining me is the ceo of j. rogers niffin worldwide. long live brick and mortar >> for sure. when these guys started, they were online and a fashion retailer now they're brick and mortar and maybe they're a health care company because they're doing contacts, they're doing eye exams, they're grinding their own lens it is a big change from 2010 to
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now. i find it very fascinating that the growth looks like it is all going to be coming -- not all coming but a big chunk of the growth will be coming out of the brick and mortar side and they intend to build more stores, and they're building pretty fast which tells you what we need to know, is that everybody needs online and everybody needs brick and mortar and one supports the other. they figured it out relatively early on >> yes, they've been doing this for a long time. it is so interesting because how many times have we seen the stories, you know, the death of mall, the death of brick and mortar, the death of the downtown it is reassuring and encouraging that brick and mortar is so important to a company like warby parker our friend has been pointing out that you basically cannot exist in a profitable, sustainable way as an ecommerce play these days without a strong footprint why is that? >> well, amazon is telling us the same thing, but the why of that is because a couple of things happened. sales around a store online are a lot better than sales when there isn't a store there. some of the reasons are the
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support of the store you can take it back to the store, you can pick up at the store. there's lots of things going on with that. the other reason is the billboarding effect because people know you exist when there's a big store there so they'll look for you online. we haven't quite figured out the whole dynamic, but clearly when you close a store and you an online player as well, sales around that store online go down, and macy's has figured it out. they've been very careful about where they keep stores and don't keep stores because they know it affects the online business. there's been a lot of work done there. i wouldn't say we are definitive, but almost everybody including amazon has figured out that if you are selling it online you still need stores >> we will talk more about that in a moment. as we are speaking, warby opened for trade. these direct listings typically take longer to open. here we are at 1:11 p.m. eastern time and they're trading around $50. i think the reference price was 40 of this one so a 35% gain for wrby a quick final question, more just about warby specifically
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but as a buyer of expensive contact lens, i think my last order was about $500, and maybe it was a six-month supply. will they be able to bring down price and get a lot of market share in this area, and what does it mean for the incumbent >> well, they clearly think they can because it is only about 1% of their business now, just like eye exams are only about 1% of their business now they believe there's an open field for them because they think that they can do the same thing that they did in the eyewear. i suspect they can there's a pretty big umbrella out there on pricing for all of those kinds of goods so i believe they will get real growth there as well, and i think having stores will help that, too. but their real business is still going to be being a public benefit company that sells glasses. i think it is interesting that they're trading well above the reference price, because that puts them well above a $5 billion valuation, and people were hoping they would be something more than a $3 billion valuation. so it tells you what the world is thinking. they seem to like this public
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benefit company. >> yes, they do. are you wearing warby parkers right now? >> i am not. i don't own a pair, sad to say >> oh, come on i guess that shows there's still plenty of room for growth. it is great to have you today. we appreciate it >> there's always room for growth when you have 1% of the market share >> yeah, that's true, and a $5 billion valuation at that. january kniffen. coming up, trucking companies are desperately looking to hire as a driver shortage in europe threatens the availability of fuel up next we will speak with the second biggest truck broker about how to fix the shortage and what other industries could be sabotaged plus, the fate of the fed is up in the air as the chair deals with two leaving what if powell's renomination becomes part of it we'll discuss it coming up
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this is "the exchange" on cnbc
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it's moving day. and while her friends are doing the heavy lifting, jess is busy moving her xfinity internet and tv services. it only takes about a minute. wait, a minute? but what have you been doing for the last two hours? ...delegating? oh, good one. move your xfinity services without breaking a sweat. xfinity makes moving easy. go online to transfer your services in about a minute. get started today. welcome back sometimes the last mile is the longest one. gas stations in the uk running dry this week with the blame lying mostly on the shortage of truck drivers to deliver fuel. the driver shortage, which existed before the pandemic, is only getting worse, and that means it is getting more expensive and taking longer to get goods and fuel to retailers and consumers.
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xpo log advertisics runs the second biggest truck business with more than 12,000 drivers but it is not enough to keep up. the chief strategy officer with xpo logistics joins me now it is great to have you with me. welcome. >> thank you for havingme. >> can you explain kind of looking back on your own career, have you seen anything like this worldwide? >> it is a unique time in lots of ways. obviously the freight transportation marketplace is stressed we're obviously very busy, bringing our customers capacity, bringing them the visibility they so dearly want in a moment like this, and we're doing it by deploying technology across our business to drive the transparency and to drive efficiency on behalf of those shippers >> when i looked at the numbers, i've seen britain is short basically, you know, let's say it has 80,000 drivers but is short 20,000 of them or something like that, like a quarter of the workforce it needs to fill right now. is that about right in terms of
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the size and scale of the problem we're talking about and how does it compare to other countries? >> it is definitely a significant issue. driver shortages are an issue in the u.s. as well i think if you look broadly at the service economy it is a very, very tight employment market obviously, as you said in the lead-in, we are extremely focused on creating, training new drivers, not only in the uk but also in the u.s. we have driver schools for the truck load business in the u.s we are substantially increasing the number of graduates from those schools and we're taking extraordinary steps to raise our recruiting bar so far it has been a successful effort >> yeah, and i'm going to ask you about your career in trucking and i realized you worked at goldman for 26 years before you came to the business. still, we have all been watching these boom-and-bust cycles for quite sometime and i don't think have seen it come to a head like this to what extent is the pandemic a
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big part of the problem? to what extent is the fact that the network is trying to keep up with demand snapping back more strongly than the supply chain is it just going to be wages that ultimately entice people into being truck drivers or are we going to have to wait for some kind of autonomous driver to bail us out of this crisis? >> there's a few different elements here. you are right that the pandemic is at the root of the challenge that we're facing. obviously much of the world economy shut down. it then came roaring back with a vengeance. consumer spending, obviously, was very strong emerging from the pandemic, and there's only so much capacity to move those goods. the pipes are only so big. as such, you are seeing a graduate -- you are seeing a rapid ramp of inventory back into the channel and it is taking some time i think the solution really is in part the passing of the pandemic, more and more people making their way back into the workforce. we are starting to see that transpire. also, i think it is up to each
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provider so it is up to each company, each shipper to do their best to bring drivers into their network. again, our efforts in doing so, which have been under way for some time, have been successful and our customers i think are starting to see the benefit of that >> matt, let's pretend it is congressional testimony or something where, you know, i can imagine we could get to that point if these things get worse, if the u.s. starts experiencing, you know, problems with truckers moving around fuel and that kind of thing if they say to you, is this almost over, is it about to be resolved or are we going to be facing chronic issues like this for months or even years time, what would you say about what the next six to twelve months hold >> i think the issues that-on the issues that you raised i think we are starting to see resolution again, we at xpo are controlling what we can control and we're making terrific headway against these challenges, but as the world normalizes in many ways, in particularly as people make their way back into the workforce, i think you are going to see these issues resolve
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themselves, the supply chain will clear up. again, right now it is essential to companies like xpo that have capacity, that have visibility, that have the technology to help our shippers and our customers achieve their goals in a tight freight market, are definitely helping the world get to where it needs to go >> yeah, i can imagine it is more important than ever matt, thanks for joining me today. i appreciate it. >> thank you so much mat fassler with xpo before we head to break, let's look how the other trucking stocks performed more broadly. old dominion freight lines up 50% since january, on track to close out the 11th straight quarter of gains ryder is up 35% to have the best year since 2013. jb hunt is up 24% year-to-date and the only one of the three about to end september in the red, down about 5% coming up, netflix is trading near its record closing highs, on pace for the best day since january after making a big acquisition. we'll tell you what it is and what it could mean for the stock. plus, this stock is on pace
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for its best day in more than 20 years after announcing a big change to its business model eethink you know what it is. twt me your guest @kellycnbc okay, imagine this... your mover, rob, he's on the scene @kellyc we cut to downtown, your sales rep lisa has to send some files, like asap! so basically i can pick the right plan for each employee... yeah i should've just led with that... with at&t business, you can pick the best plan for each employee and get the best deals on every smartphone.
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welcome back let's get a quick check on markets. the nasdaq is back in positive territory, hanging on to a 10 point gain the dow is up. boeing is leading the dow after an up date from bernsteins, calling it a recovery with shares up about 3.5% the mystery before the break was dollar tree. investors are cheering the plan
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to, get this, raise prices above $1 i wonder if it is an issue with supply chain inflation stories going on we will see if consumers love it investors do dollar tree up 16% shares of warby parker surging on the new york stock exchange, up 35% the reference price was $40, so that one opened in the past 10 or 15 minutes time over to rahel solomon for the cnbc news update rahel. >> hi, kelly here is what is happening at this hour. hurricane sam may be offshore, but forecasters say that the storm could bring life threatening waves and rip currents to the east coast this weekend. hurricane watchers are keeping an eye on the storm which is packing sustained winds of 130 miles per hour a new poll from the associated press finds that unvaccinated americans are planning more travel and heading back to gyms and churches, and at the same time more than one in three vaccinated adults over 50 are very or extremely worried that they or a family member will become infected that number has roughly doubled
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since june in slovenia thousands protesting tough anti-covid measures in the small european country. riot police fired tear gas and water cannons to control the crowd. they have suspended the use of the johnson & johnson vaccine following the death of a 20 year old who received a shot. on the news, backlash from youtube, deleting posts and accounts with anti-vaccine content. that's tonight at 7:00 eastern kelley, back to you. >> thank you very much affirm joins the likes of paypal, lose and motors powers up and one department stores giant billboard blunder. it is all coming up in today's rapid fire in a moment before we go to break it is spanish heritage month we are highlighting business leaders and our own employees. here is chair elect. >> the united states bank of commerce proudly represents more than 5 million hispanic-owned businesses across the country and our pride comes from knowing
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the positive contribution these businesses make and their role in driving equitable and sustainable economic recovery. in fact, hispanics accounted for more than 80% of all new businesses created in the last decade as we celebrate hispanic heritage month join me in saying thank you to the business leaders across our country into? at new chapter, its' innovation, organic ingredients, and fermentation. fermentation? yes. formulated to help you body really truly absorb the natural goodness. new chapter. wellness, well done.
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welcome back, everybody. let's catch you up on a few stories that should be on your radar. it is time for rapid fire. here to help me break down the headlines, the managing director and chief market strategist at taback and sarah fisher is media reporter at "axios." welcome, everybody we will start with netflix continuing its push into gaming and investors love it. they're buying their first video game developer, night school studio here is where the co-ceo had to say at the code conference about opportunities in gaming. >> i'm sure people will spend more time gaming as adults than 10 or 20 years ago, and part of that is going to be is netflix the way of monetizing content better for the consumer in the game world like it was in tv and movies >> again, even as a lot of big tech companies are down about 10% from their recent highs,
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netflix is nearly at its closing high shares are up about 3% today, a little bit off the highs of the session. is this the next catalyst for the streaming giant, molly what do you think? >> you know, i think this is such a smart move because it is all about guaranteeing an ongoing stream of content. making movies and tv is really expensive, and you sort of have to hope that you get a hit whereas gaming is known to be engaging people get addicted to it. it is probably actually cheaper in the long run to buy game studios than to keep trying to recreate something with a huge budget like a "game of thrones". >> sarah, i guess because i don't know enough about gaming, i'm confused about do they need hardware for the games how does it work this is a pretty crowded space as it is, so even if it is a big opportunity, why is netflix the right place for people to go for gaming content >> such a good question. i mean netflix owns the living room, kelly, but they don't own your phone most people are not streaming their big hits in between commuting to work and home that's the key difference here
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this is mostly meant to be a mobile gaming play, and so what they're trying to do is if they can get you hooked on some of their key franchises like a "stranger things" while commuting, you will be more likely to want to go home and watch some of the series on your living room tv set so really what netflix is doing is creating a fly wheel around their ip and that's something that their competitors like disney have been really good at for many years >> matt, what would you add and what are your thoughts on the way the stock is trading >> yeah, i would say that i think it is such a great move because let's face it, netflix changed the way we watch tv and movies i mean it is not just -- you know, it is not just the way we do that, they also changed the content. i mean they kind of did what "all in the family" did in did 1970s, changed the way -- the way they could do things on tv and, you know, created all sorts of great comedies over the next 30, 40 years netflix has done the same thing. you know, they have "the crown"
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but also "ozark" and a wide audience i think what they can do with the gaming is make it more interactive and more widely accepted but as for the stock overall, the great thing is that the stock had been in a sideways range for a year they've been a relatively wide range, but it is now breaking out of that range. you know, we are having a lot of volatility in the marketplace now. once those things calm down, whatever stock moves out of a multi-month sideways range, and this was about a 14-month range, it breaks out to the upside and gains a lot of momentum. i think the upside is good for this name. >> i am still scratching my head but the market is casting the vote netflix is over 600 with a lot of excitement around the opportunities. it will be interesting to see how it changes consumer behavior with the platform. speaking of platform, the buy now, pay later platform affirm is getting into crypto. the company announced plans to roll out its own debit card and let customers use savings account on the platform to buy
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crypto as well as split up payments down about 1.5% today, but up nearly 150% from the debut in january. its market cap is more than $30 billion. molly, this is not the player i expected to be getting into crypto it is kind of the theme of rapid fire today i guess what do you make of it >> exactly, unexpected moves that are about owning you wherever you are to sarah's point. this is exactly that what i think is so interesting about that is that affirm's max lift has made no bones about the fact he makes that big banks are ultimately problematic for consumers and he's trying to create a different sort of space, and allowing the crypto investment, i have heard from a lot of people who say they consider crypto investing to be more accessible, to be more of an equalizer than investing in traditional stocks and bonds and having gate keepers. if you are trying to be a do-everything-finance app, decentralization, take people away from big banks' app, it makes sense to offer this
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investment opportunity simply because crypto isn't going anywhere i wouldn't take it as a bigger bet than it is on the existence of crypto. it is more like it is something consumers want to do, so why not offer it if you are trying to be everything >> sarah, i think it gives a peek into the ambition goes of buy now, pay later it is about more than the way that you split up payments to buy a large item this is like molly hinted out. this is about the traditional financial system, the traditional payment processors, right? >> absolutely especially for gen zs and millennials this generation, all they're doing right now is tipping on their favorite platforms but they're not into putting all of their payments on one big credit card and incurring debt. this generation pays much differently and saves much differently than the generations before that's why some of the competitors to what you are seeing ali pay, et cetera, have been so successful because they're targeting the next generation of financial consumers. to molly's point, those
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consumers won't be attracted to traditional payment sis tempts brought up by big banks. they want something different. they love crypto i'm surprised their stock is down a little bit. typically you saw with paypal the stock shoots up when they make this announcement i'm curious to see how it moves in months coming >> matt, do you want to offer a comment? why aren't they getting the halo effect on crypto, is it because crypto is maturing, it is a competitive space? the number of times people came on and talked about trying to disintegrate them and if they can continue the reign for longer >> i think they can over the long term but i agree with the issue on the cryptocurrencies. i don't necessarily think it is a great catalyst for affirm. it is just, you know, we have a situation that we have seen with china recently where basically they banned it completely, any transactions in that area. of course, it is a big, big market for anybody looking to expand, number one number two, we have gary
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gentzler who is definitely signaling they will put a lot more restrictions on the cryptocurrency going forward now, i mean let's face it, countries only have one really, really big power, that's the control of their currency. so it is not just china who is going to put some restrictions on here. so i just don't think it is the one that -- the catalyst that will take this company and the other companies like paypal higher, although other things can because they are good companies. >> in other words for a company who is already seen as successful, the addition of crypto now could present a bigger regulatory risk than investors might be comfortable with that's an interest inpoint again, we see the shares dippin into negative territory. they say they have more than 13,000 reservations so far, the entry level starts at 70,000 we had john murphy on, who is bullish on the range opportunities. lucid was important in the tesla
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model as well. he is saying it is an open question, who will become the leader in the ev space listen >> the core platform of the vehicle itself is where lucid is really going to succeed and really outstrip a lot of the competition and where they will be really successful on the ev side, but it is an open ended question who the winners will be and what it means over time. >> matt, your thoughts on this one? >> well, i got to tell you, the number one thing is there's several of these companies out there, but nobody has been able to come out with a product now lucid has, so that obviously gives them a big step up on everybody else i mean obviously not with tesla, but i mean the other companies that we've been talking about. the thing i really like about the stock is that, you know, it had a big run, you know, back in the beginning of the year because it was -- had a big short interest and the meme stocks all ran up like that. but after it came back down it got stuck in a sideways range, had been trading there for basically the last six months. now we are bumping up against the top end of that range, and if it can break out from there
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it is going to track a lot of momentum money into this stock you know, again, like i said before, whenever you get a stock trading on a multi-month sideways range, once it breaks out in either direction, it really moves in this case it is testing its upper end there, and if it breaks out it is going to run. >> lucid is, i think, the first spac to scale production of an ev, molly. there's a lot at stake for a market that's had some high-profile failures and we're still kind of waiting to see if this one can make it more common as we've seen with traditional oems to bring the electric vehicles to market and what it means for tesla's ambitions here >> yeah, look, if you are getting an ev to market now and you are a relative unknown, this is the moment because all of these traditional automakers are about to be in this business in a big way. so there's never going to be a better opportunity to sort of try to make a name for yourself. i have to say i think that's going to be tricky because tesla has so much name recognition and a big cult following, but you
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also have an administration that while it put a lot of weight behind evs and the importance of this energy transition, it hasn't put any weight behind sort of nontraditional carmakers. >> right >> if you see who is invited to the party, it is all the names we already know, and that creates even more of an uphill battle for a brand-new car company. >> yeah, maybe to illustrate the point i saw mary bar au is the new head of the business round table announced earlier today, the ceo of gm, indicating how entrenched the company will be in the future of the business community here speaking of business we have to get this story in today before we go amazon and macy's are fighting a war of words over a billboard. amazon wants to put a billboard on top of the iconic flagship macy's store in court filings they said the damage to macy's customer good will, image, reputation and brand should a prominent online retailer is impossible to calculate. amazon is down from highs and they made it clear they want and
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need alarger brick and mortar presence shares of macy's have been on a tear for a while what do you think? >> it is a tale as old as time i remember when google and microsoft were fighting, and this is what competitors do, kelly. they take a big piece of real estate, put up a big billboard or ad to spook competitors by the way, macy's is right to be spooked there's no better symbolism your industry is taken over by big tech than having your brick and mortar display your biggest online competitor. we will see how it weighs out. i know they're talking to the landlord about not letting amazon have the space but if they do it is bad news for macy's >> i wonder if it could backfire for amazon, if they should let them try molly, i will give you the final word on this let's remind everybody, we assume amazon is the big winner who will come in and destroy this space, but we've been
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speaking with real tail analysts who say they need brick and mortar, ecommerce is flattening out after what has been a massive share and maybe we shouldn't assume the relationship is, you know, what it is commonly thought to be >> i think that's really true. i think that the brick and mortar thing matters, but i want to zero in on one of macy's big complaints which is they will suffer reputational harm if amazon advertises on top of their store. there is a possibility that what you are seeing is a little bit of that backlash already the consumer sentiment that says, weirdly, you know, you remember that barnes and noble used to be evil before amazon came along you could actually see a surge of good will toward macy's based on nostalgia if they go ahead with this. >> yeah, maybe a hollywood movie. what was it, "you've got mail," molly. >> i love that movie >> yeah. >> -- on the green monster in boston, i think that's the next
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movie. >> maybe it will be. guys, thank you all for your time today we appreciate it matt mally, molly wood and sarah fisher for this edition of "rapid fire. cnbc's delivery alpha is under way. they're talking about the esg boom tpg executive jim coulter says while tesla might be the first big ev company the truly big players have yet temgeo er the opportunity he says is large. we will have more after the break. you founded your kayak company because you love the ocean- not spreadsheets. you need to hire.
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welcome back, everybody. cnbc's delivery alpha virtual conference under way today leslie picker is here to drill down on what some investors had to say about esg in particular leslie >> kelly, live in person for once, which is lovely. but when we think about esg investing it boils down to a few things, purpose-oriented investing more profitable or does it simply protect the downside or, which is the more cynical view, is it a marketing employ
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well, chris ailman says while some managers believe incorporating esg is the right thing to do, they're not always doing it right >> there's no question there are some asset managers who are just using those words because it is a marketing tool there are a few asset managers who actually believe it is material and important to their investment process >> wellington's wendy cromwell says the research into the area is used to help mitigate risk in the portfolio to pinpoint holdings that might be vulnerable to things like c climate change but tpg's jim coulter believes there's alpha to be had. he raised a $5 billion fund along with treasury secretary. >> we're moving into an era where you can't count on that beta and you have to deliver alpha. that's what -- so where are you going to find alpha? the disruption and change, and major ways in the economy. you might choose biotech, you
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might choose reshoring, but i think it is what my partner hank paulson calls the biggest industrial revolution in the history of mankind, which is decarbonizing the economy. we are just on the early moments of that era, and that to me is interesting and why i'm searching for alpha there. >> now, if you can tell, big thoughts, ambitious thoughts that have been shared in the first half of the day but we're only halfway through there's still so much more to come at delivery alpha, firesides with altimeters brad gers inning, chamath palihapitiya, katie hahn, so much more to go and it is not 2:00 yet >> i love what jim coulter is saying because we are at a time where there are sort of eye-watering opportunities in energy, kind of bad reasoning, but on the other side is consumers and business that have to pay the massive price spikes. like you are saying, if we're so early maybe we are in the aol stage of kind of the clean
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energy trend, whatever you want to call it, i wonder what they're going to be able to invest in. you know, if we have to wait, if we're not at the era yet of having names like salesforce and google, you know, that was maybe ten years after we first saw internet disruption in the 1990s, so will he be able to find the big bets now? are we still some years away from that i wonder >> i think it is a critical point to be made when it comes to esg because it is one of the things where we've seen a huge rush of capital flow into the space, and one thing that i asked chris ailman, is this something investors feel like they are just doing because everybody else is doing it >> right >> because the herd is doing it? that's where you think like jim coulter was talking about with regard to kind of dot-com era, the internet was the big thing, so everybody felt they had to be there without understanding what it meant >> yeah. >> and how it would impact us. >> and how a lot of capital was destroyed before a lot was created in the cycle after that. thank you for the recap, we appreciate it. as mentioned, there's more coming up for delivering alpha
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this afternoon still ahead, what j. powell didn't say yesterday is more revealing than what he addressed. he joins me to explain after this break hey, guys! they have customized solutions to help our family's special needs... hey, graduation selfie! well done! and voya stays by our side, keeping us on track for retirement... us confidence in our future... ...and in kevin's. you ready for your first day on the job? i was born ready. go get 'em, kev. well planned. well invested. well protected. voya. be confident to and through retirement.
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♪ jay powell mayknow his day are numbered we will discuss the message he sent in yesterday, and the fate of the fed right after this break stay with us
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welcome back to the change quick news alert walgreens is weighing a take over of evh. shares have been halted, they have reopened, up 11%. walgreens is up a little bit less than 1% on the report. the fate of the fed and taper time line where in question after the resignation of two members those issues and what fed chair powell didn't say in his senate testimony yesterday could reveal he knows his ten oou as fed chair might be over.
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david zervos joins us, the chief market strategist at jefferies you think he won't be nominated? >> well, to be clear, kelly, i thought jay's probabilities were actually low i was away from the market and have been the better part of the year. >> true. >> i thought divisive politics in d.c. really meant that the democrats did not want a republican in such a powerful job going into the mid terms especially if they are unable to get this fiscal p.k.age through and the only thing left is monetary policy. they need real control even further ahead, into the 2024 presidential election. >> you are right, i remember you wrote about this maybe even year ago. all the dovish surprises he has given us the last few months, people are surmising this was
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part of this effort to signal i'm still your guy now maybe you are thinking it's not so much there is anything wrong with what he's doing on the monetary policy side but there is an opportunity for people to replace him and maybe questions need to be asked about why there wasn't more oversight into what was going on with this trading. i think you are right. i think this creates an opportunity for progressives that we know were going to try to take him out anyway elizabeth warren, that was as aggressive i have seen a senator treat a fed chair in the 30 years i have been watching this. it was really an ugly exchange at the end i think she has ability to step it up because the things look more vulnerable. you have a trading scandal under your watch, you are the boss you probably vshould have been
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more cognizant about what was going on he has questions on the municipal bond portfolio issue of his own i think it's an opening. i do think even without it it would have been a tough decision in the end for the biden administration particularly if this fiscal stuff gets hung up, which it looks like it is going to did. >> that's another factor hoo you went back and said maybe the hawkish messaging we saw last week could have been an early way of him kind of paving the way for a post-fed legacy. but i wonder if the practical takeaway for investors here is a more dovish fed. what does that mean for rates? for the yield curve? i am curious how you would play this narrative out. >> it's really complicated i was very pez puzzled i was on with sara and wilf after the press conference on wednesday. and i said to them -- i'm like, you know, i just listened to this thing, it was me and paul
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mccully. i said this sounds like a different jay. i really didn't get it like, what's changed he didn't mention "transitory" he didn't talk about long term disinfligsary measures he didn't talk about the 5 million missing jobs usually he is much more for lack of a better word dovish. the market noticed and then went on its way a little bit of a dip and it came back. everybody was perplexed. as i was thinking about it into friday and the weekend i thought what's different not the data employment data was weak during the post jackson hole premeeting period and the cpi came in weak. what's different is this scandal. i think the scandal changes the internal thinking of someone like jay whose odds are lower and maybe he doesn't have to play by the game he has been playing by, which is to try to apiece the administration so he gets the job
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>> this is all speculative, totally. i think these are exactly the kinds of things traders are discussing, talking about who might step up, whether it might mean more dovishness and whether that's feeding into the moves and the rates that we have seen. since it is changing day-by-day and week by week we will check back in and see how it progresses i appreciate you laying out the landscape as you see it today. good to have you >> always good to be here. >> dave zervos with jefferies. that does it here on "the exchange." "power lunch" begins right now don't go anywhere. thanks, kelly. welcome to "power lunch," i'm dominic chu in for tyler mathisen today here's what's ahead. semis, the chips running red hot but starting to cool off how do you play the space? a top analyst separates the winners from the losers. speaking of red hot, energy prices have been on fire but at what point does demand


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