tv Maria Bartiromos Wall Street FOX Business May 28, 2022 10:30am-11:00am EDT
cut back on guidance and if they get through this earnings report without cutting items this stock could look interesting. jack: that when gives me pause. great ideas, thank you so much. check out this edition of barron.com. that is all for us, see you next week on "barron's roundtable". that does it for us. thanks for watching. ♪ >> from the fox studios in new york city, this is maria bartiromo's "wall street." maria: and happy weekend to all. welcome to the program that analyzes the week that was and helps position you for the week ahead. i'm maria bartiromo. thanks for joining us. many americans changing their travel plans amid record high gasoline prices. president biden declaring it all a part of an incredible transition away from fossil fuels. does it feel incredible to you? senator lindsey graham is here
walking in on this and more -- weighing in on this and more coming up. plus, a new read on the strength of the economy coming in worse than expected. john lonski and nancy tengler on the greater likelihood of a recession. plus, americans facing a wallet-busting barbecue this holiday weekend. i'll be asking grocery chain ceo john cast ma tee d.c. how much higher food prices will climb. but first, here's a look at gasoline twices -- prices on in the memorial day weekend. president biden trying to spin the record rise. >> when it comes to the gas prices, we're going through an incredible transition that is taking place and, god willing, when it's over, we'll be stronger and the world is stronger and less reliant on fossil fuels when this is over. maria: a fossil fuel-free america? joining me now to talk more about that is south carolina senator lindsay graham. senator, it's great to see you. thanks for being here. >> thank you. maria: so what is the president talking about?
we're in this incredible transition. so, in other words, these high prices for gasoline are intentional? >> yeah, i think that's the main takeaway from his statement, that he is telling the american people they're doing this to you on purpose, that the transition period is being imposed by policies coming from the biden administration. it's not putin's fault. this is a conscious effort by the biden administration to destroy fossil fuel production in the united states, to get away from fossil fuels, and you're living this experience. this is an irresponsible shutting down of oil and gas production in america making us more dependent on oil and gas from bad actors, and it's destroying the american economy. but the takeaway is what you said. this is being done on purpose. maria: this is the really extraordinary to me, and now -- >> yeah. maria: -- you're talking about food shortages as a result of what's going on in ukraine, the death and destruction at putin's hands. >> right.
maria: are we going to see a food famine in some parts of the world? >> well, you've got 40 nations depend on grain from ukraine 50% of their grain coming from ukraine, that's going to have an effect. we've had three famines in africa in the last ten years that have been historic in nature, so we're going to have a food shortage throughout the world, and 2350 prices are going to go up. but add -- at the end of the day, every time energy prices go up, that increases the cost of growing and shipping food. if you could just change the cost of energy, lower the cost of energy, you would dramatically lower food prices in spite of the war in ukraine with. maria: yeah. but, look, on day one in office the president canceled the keystone pipeline, he canceled any drilling on federal land. i mean, that was the beginning of serving prices higher and inflation started at 1.4% when the president took office. look, policy when it's bad, it
results in bad outcomes. >> right. maria: i want to get your take on the tragic shootings this week in texas. our hearts go out to the 19 families. but it quickly turned political. democrats are demanding stricter gun laws in the face of 19 children dead. here's texas governor greg abbott firing back. watch this. >> let's talk about some real facts. there are, quote, real gun laws in chicago. there are, quote, real gun laws in new york. i hate to say this, but there are more people who were shot every weekend in chicago than there are in schools in texas. maria: so, senator, what about that? and during that press conference that governor abbott gave, you had beto o'rourke running over there and losing it, blaming governor abbott.
>> yeah. number one, i think what beto o'rourke did tells you all you need to know about the status of his campaign. he's a desperate politician doing despicable things to try to stay relevant, and we need leadership at a time of crisis not showmanship. and all i can say we have a constitutional right to bear arms, but it's not unlimited. count me in for trying to have better laws to detect the these events before they happen, allowing cops to intervene when somebody's showing a danger to themselves or others. but gun violence is a problem in this country, there's no question about it, but the constitutional right to bear arms does exist, and there has to be limitations on what you can do. so all i can say about what happened in texas, it breaks my heart. but i don't know if any law that i can pass that would deal with a man, 18-year-old man, shooting his grandmother in the face, going to a school, locking the door and killing every kid in
the class. but one thing i want to tell you and everybody listening, i don't know how to fix this. maria: well, i mean, we are cherishing the border agents who stopped -- >> yes. maria: -- this death and destruction. it was a border agent -- >> yeah. maria: -- the because, obviously, it was close to the border. but look, senator, i think people are struggling to understand why there is not more security. armed guards -- >> that's right. maria: -- at schools. >> the one thing that's in common here is that the people who do this are disturbed, obviously. but mental health is not the answer to this question as much as just pure evil. so the thing that i'm focused on is how do we kill these people when they come into the door or neutralize them before they kill a bunch of kids. that's one thing we can do better. so i'll -- count me in for trying to beef up security at schools so these guys get stopped when they first come in.
maria: let me ask you about what we learned this week in the trial of the clinton lawyer, michael sussmann. with we learned that hillary clinton approved giving the trump-russia lie story to the media. she approved it herself. and and that michael sussmann billed the clinton campaign on the very day he talked to the fbi about the fake trump ties when he said he was there as a concerned citizen. will we see any repercussions for the fbi or even for hillary clinton? you worked on this for years, and we talked about this over a several-year period, that this was a total the lie and it had a massive, massive impact on our country. >> it's funny you ask, that's a good question. i asked director wray about the horowitz report that you covered in detail indicating 19 violations of fbi policy regarding the carter page warrant. what's the storyline here? they had a lawyer for the clinton campaign apparently was able to dupe the entire fbi into
believing that donald trump had a relationship illegally with a russian bank that was a bunch of b.s. here's what i think, they wanted to believe it. the best explanation for all this is that every time there was a stop sign, they ran it because they wanted to get trump. there is no other explanation. how could they miss all the warning signs about dossier being a bunch of bull? how could they buy hook, line and sinker what sussmann said and not pass on to agents that the tip came from a lawyer of a campaign running against trump? they wanted to believe it. the only explanation i can give you is that the fbi agents and the head of the fbi at the time wanted to get trump, and they ignored every stop sign because they didn't want to stop. maria: well, we talked about this and you told me about the danchenko interview years ago. >> right, yeah. [laughter] maria: he talked to the fbi in january 2017 and said, look, we
embellished it, we lied, having beers and fun with friends. and yet the fbi went ahead and continued to pursue fisa warrants against trump the officials. >> yeah. maria: look, where's the accountability for the fbi? how come it has become so political? >> well, you know, i think director wray -- i asked him a question about in the, he said it's a terrible chapter in the history of the fbi and we've fired people that were involved, but there's more accountability coming, i hope. there may be an fbi agent under investigation for withholding information regarding papadopoulos. i hope carter page will sue the fbi for the warrant that was issued. in january and march of the year in question, the fbi was told by the subsource that the russian dossier was a bunch of bar talk, and they continued to get warrants after they were told that. comey and mccabe said they never heard that. i have a hard time believing that. i hope there'll be civil litigation, and i hope there'll
be more criminal investigations, and i hope people will be prosecuted who took the law in their own hands. maria: all right. we'll be watching that, certainly, all summer. some think there will be more indictments this summer. senator, we so appreciate your time. thanks so much. >> thank you. maria: senator lindsey graham in d.c. american economic growth contracting more than expected in the first quarter, another contraction next quarters and we contraction next quarters and we are officially in recession. liberty mutual customizes your car insurance so you only pay for whatchya... line? need. liberty biberty— cut. liberty... are we married to mutual? only pay for what you need. ♪ liberty. liberty. liberty. liberty. ♪ another crazy day? only pay for what you need. of course it is—you're a cio in 2022. so what's on the agenda? morning security briefing—make that two. share that link. send that contract. see what's trending. check the traffic on your network,
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wow, we're crunching tons of polygons here! what's going on? where's regina? hi, i'm ladonna. i invest in invesco qqq, a fund that gives me access to the nasdaq-100 innovations, like real time cgi. okay... yeah... oh. don't worry i got it! become an agent of innovation with invesco qqq huck. maria: ♪ maria: welcome back. let's take a look at where markets ended another volatile week. it was a good week. got a newed reading on the strength of the economy with first quarter gdp showing a contraction of 1.5%. that was more than previously reported, and it was worse than expected. joining me right now to talk about all of this is through the cycles president john hon lonski and nancy tengler.
great to see you both. thank you so much for being here. well, we knew we were in conning traction mode in the first quarter, john, but it was actually worse than we thought. what does this tell us, in your view? is this going to be the beginning of what will be a recession that we're in right now? >> i don't think it's the start the of a recession. i think it's important to note that this decline by first quarter real gdp was wholly the consequence of a widening of the trade deficit, and that wider trade deficit reminds us the u.s. is doing a lot better than the rest of the world. if we take out the wider trade deficit, we find that real gdp growth goes up to a positive 1.7%. and moreover, if we take out this drop in inventory accumulation, then we're left with real gdp growth of 2.7% for the first quarter. economic fundamentals still point towards growth.
maria: nancy, we got a really good look at the consumer this week, and it was really bifurcateed, right? home depot was good but walmart wasn't. williams-sonoma and macy's was good but target wasn't. what's going on in retail right now? >> yeah. well, and i think, maria, that what you will see -- and it showed up in the gdp numbers -- even though real disposable income is down 2% in the first quarter, it's actually much better than it was in the fourth quarter. so we're seeing consumers shifting. it was an execution problem at both walmart and target. i wrote about this and said i didn't think it was an indication that the whole retail sector was down. you had dollar general and the dollar store turning in better than expected earnings, you had same with nordstrom, so the high-end consumer is still strong. macy's numbers were great. and as you mentioned, both home depot and lowe's turned in really good report. lowe's actually expanded margins during the quarter. so i think -- i absolutely agree with john on the economy.
imports were a negative drag because they're subtracted. when we import goods, they're subtracted from gdp, and that cost us 3.2%. and what was happening was seasonally that quarter's usually lower for imports, but because we had all this inventory floating off our coast, the ports were able to offload a significant amount of inventory that's built at some of the retailers like walmart and target. maria: john, we got the federal reserve minutes from the may meeting, and there was basically a unanimous decision to raise rates by another 50 basis points at the june meeting and then another 50 basis points at july meeting. they debated whether or not we're going to see a 50 basis point hike in september as well. they also added a word, restrictive, that the it may require that the federal reserve policy gets restrictive. what did you learn from the fed this week? >> well, what i learned from the fed is that i'm pretty certain
that we'll be looking at a fed funds rate now at .88% of 1.88% by the end of july. but what happens after that is problematic. it's questionable. i can't help but come to the conclusion that though we are not at the cusp of a recession, the u.s. economy business activity is slowing down in response to higher interest rates. home sales have fallen considerably. my goodness, new home sales in the month of april were down by 27% from a year ago. the takeaway from this is that we are probably going to have fed funds peak at something perhaps not much greater than 2.38%. forget about a 3% fed funds rate. maria: nancy, how do you want to allocate capital in the wake of that? >> we're really focused on companies that are raising dividends, and that -- this was a record quarter for dividend
increases, in the first quarter. and that tells me management is a little bit more optimistic than the rest of us. maria: john, your look at the jobs numbers, what are you expecting off the jobs numbers? are layoffs about to start coming out? >> layoffs have started for certain companies in high-tech, we've heard from staff and -- metaand others that they're cutting staff in some cases. i believe the monthly increase for payrolls in the month of may is going to drop from april's 428,000, 325 the ,000 new jobs in may -- 3 325,000 in may, that will be the smallest monthly increase since april of last year. but let's not forget that we need to see a much softer labor market before we can take predictions of imminent recession seriously. maria: yeah. >> prior to previous recessions that average monthly increase by payrolls was less than 100,000
new jobs per month over a three month spafnlt fortunate my, we're not there yet. maria: great to see you. have a wonderful memorial day weekend. the cost of your memorial day cookout is a lot higher than it was the last year. it's up more than double digits from last year. from last year. i'll be talking with john ♪ ♪ ♪ ♪ we believe there's an innovator in all of us. ♪ ♪ that's why we build technology that makes it possible for every business... and every person... to come to the table and do more incredible things. ♪ ♪
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maria: welcome back. well, a barbecue wallet-buster. as you no doubt have noticed, it is costing more for your memorial day food in the year. key items like ribs, ground beef, chicken all up double ding the jiltses from last year. joining me now to talk about that is united refining company chairman and ceo john katz ma
tee d.c. john, happy memorial day to you. it's not so happy for those of us who are getting our wallets busted because so much is costing us so much more. how would you assess inflation at grocery store today? >> it's high and it's going to go higher, maria with. it's -- maria. it's because of the cost of doing business in the stores, labor costs are up, continue to rise. labor shortages are -- we're short being able to hire people. the manufacturers that deliver to our story store -- stores and to all stores, they are increasing costs. and mostly a lot of it, 70% of the transportation that is done for product in all stores in the united states is done by diesel fuel. and the factories are run by diesel fuel. so as the price increases and
the talk about shortages in diesel fuel are happening, are happening if depending on the area, that is showing a significant cost to the consumer. when britain says they're going to this morning or the other day that they're going to increase taxes on the oil companies, that's just fueling the poor and middle class saying, why aren't we doing something about it? but it's all -- it's the dumb can, because all these companies are going to do is pass it on to the consumer. so all it is -- maria: right. >> -- an additional cost to consumer. martha: -- maria: all of the things we buy are up, eggs up 18%, meat up 17%, the price of an airline ticket up 3 3%. so you say it's about oil and diesel at the end of the day.
what is it going to take to get oil and diesel prices down? >> well, let's open up north america like we've always said? the british, some of the companies in europe said to great britain, can we drill in the arctic ocean? they said, absolutely not. meanwhile, china, russia, they're doing whatever they want. we are being forced not to be to competitive in the world. how do you say that in english? i mean, it's plain english. maria: yeah. >> we are being made to be noncompetitive. everything that the washington has been doing for the last 12, 14 months is making the american consumer poorer, the american poor poorer, the american middle class poorer. and guess what? we're making the rest of the world richer. maria: yeah. i know that it's costing us all much more this memorial day, but you just said it's going to get worse and that's because we
haven't entered the peak driving season, right? is that the reason? oil prices get higher and then inflation follows. >> there's the about a 30-day lag sometimes between prices -- maria: i see. >> -- and the store thes or -- stores or prices as the got tank. if you look at your screen, crude oil is up to, like, 115, 116. 30 days ago it was only 100, 105. maria: yeah. i see. >> so what does that mean? that means you're going to see higher prices 30-60 days from now. maria: got it. john, we so appreciate it, john cats mama tee d.c. join us on cats mama tee d.c. join us on inflatio dad, we got this. we got this. we got this. we got this. we got this. yay! we got this.
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6-9 a.m. eastern for "mornings with maria." we hope you'll start your day with us every weekday. that'll do it for us for now. thank you so much for joining us. have a wonderful memorial day weekend, everyone, and a safe one as we honor men and women who make the ultimate sacrifice serving our country and delivering freedom and liberty. we'll see you again next time. ♪ ♪ ♪ gerry: hello and well welcome to the "wall street journal at large." this week we're in davos, switzerland, for the annual meeting of the world economic forum. we'll be talking with the secretary general of nato. with the u.s. sending tens of billions of dollars to help ukraine with, could we get dragged deeper into conflict? plus, we'll discuss the darkening prospects f